---

|UNITED STATES                                                                                   
|------------------------------------------------------------------------------------------------
|SECURITIES AND EXCHANGE COMMISSION                                                              
|Washington, D.C. 20549                                                                          
|                                                                                                
|                                                                                                
|FORM 10-Q                                                                                       
|                                                                                                
|                                                                                                
|(Mark One)                                                                                      
|                                                                                                
|                                                                                                
|[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
 EXCHANGE ACT OF 1934    
|                                                                                                
|                                                                                                
|For the quarterly period ended: June 30, 2010                                                   
|                                                                                                
|                                                                                                
|[   
] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
 EXCHANGE ACT OF 1934
|                                                                                                
|                                                                                                
|Commission File Number: 000-21071                                                               
|                                                                                                
|                                                                                                
|GOLDEN ELEPHANT GLASS TECHNOLOGY, INC.                                                          
|(Exact name of registrant as specified in its charter)                                          
|                                                                                                
|                                                                                                
|Nevada                                                                                          
|(State or other jurisdiction of                                                                 
|incorporation or organization)                                                                  
|                                                                                                
|123 Chuangye Road, Haizhou District,                                                            
|Fuxin City, Liaoning                                                                            
|People's Republic of China, 123000                                                              
|(Address of principal executive offices, Zip Code)                                              
|                                                                                                
|                                                                                                
|(86) 418-399-5066                                                                               
|(Registrants telephone number, including area code)                                            
|                                                                                                
|                                                                                                
|Not Applicable                                                                                  
|(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 [    ]         No [ X ]

Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files).

Yes [    ]         No [    ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See
the definition of  large accelerated filer, accelerated filer and
smaller reporting company
in Rule 12b-2 of the Exchange Act:

|Large accelerated filer
[    ]                                             | Accelerated filer 
[    ]      
|-------------------------------------------------------------------------- | -------------------------------
|Non-accelerated filer
[    ] (Do not check if a smaller reporting company) | Smaller reporting company
[ X ]

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

Yes [    ]         No [  X  ]

Indicate the number of shares outstanding of each of the
issuers classes of common stock: as of June 10, 2011, there were 28,623,996
shares of common stock, par value $0.01 per share, issued and outstanding.

---

CERTAIN TERMS USED IN THIS QUARTERLY REPORT ON FORM 10-Q

Except as otherwise indicated by the context, all references
in this report to (i) the "Company," "we," "us," "our" and "Golden Elephant" are
to Golden Elephant Glass Technology, Inc., a Nevada corporation, and its direct
and indirect subsidiaries; (ii) "Dollar Come" are to our direct, wholly owned
subsidiary Dollar Come Investments Limited, a British Virgin Island company;
(iii) "Fuxin Hengrui" are to our wholly owned subsidiary Fuxin Hengrui
Technology Co. Ltd., a PRC company; (iv) "Fuxin Xianheng" are to our wholly
owned subsidiary Fuxin Xianheng Float Glass Co. Ltd., a PRC company; (v) "RMB"
are to Renminbi, the legal currency of China; (vi) "U.S. dollar," "$" and "US$"
are to the legal currency of the United States; and (vii) "China," "Chinese" and
"PRC" are to the Peoples Republic of China.

|        | FORM 10-Q                                                                                                                                                         |           
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------
|        | GOLDEN ELEPHANT GLASS TECHNOLOGY,
      INC.                                                                                                                      |           
|        | INDEX                                                                                                                                                             |           
|        |                                                                                                                                                                   |           
|        |                                                                                                                                                                   | Page      
|PART I  | FINANCIAL INFORMATION                                                                                                                                             |           
|        | Item 1. Financial Statements (Unaudited)                                                                                                                          | i         
|        | Condensed Consolidated Balance
      Sheets as of June 30, 2010 (Unaudited) and December 31, 2009                                                                 | F-1 - F-2 
|        | Condensed Consolidated Statements of Operations
      and Comprehensive (Loss) Income for the Three and Six Months Ended June 30, 2010
      and 2009 (Unaudited) | F-3       
|        | Condensed Consolidated
      Statements of Cash Flows for the Six months Ended June 30, 2010 and 2009
      (Unaudited)                                           | F-4 - F-5 
|        | Notes to Consolidated Financial
      Statements as of June 30, 2010 (Unaudited)                                                                                  | F-6 - F-18
|        | Item 2. Managements Discussion
      and Analysis of Financial Condition or Plan of Operation                                                                    | 1         
|        | Item 3. Quantitative and Qualitative
      Disclosures About Market Risk.                                                                                         | 10        
|        | Item 4. Controls and
      Procedures                                                                                                                             | 10        
|        |                                                                                                                                                                   |           
|PART II | OTHER INFORMATION                                                                                                                                                 | 11        
|        | Item 1. Legal
      Proceedings.                                                                                                                                  | 11        
|        | Item 1A. Risk Factors.                                                                                                                                            | 11        
|        | Item 2. Unregistered
      Sales of Equity Securities and Use of Proceeds.                                                                                        | 11        
|        | Item 3. Defaults Upon Senior Securities.                                                                                                                          | 11        
|        | Item 4. (Removed &
      Reserved).                                                                                                                               | 11        
|        | Item 5. Other Information.                                                                                                                                        | 11        
|        | Item 6. Exhibits                                                                                                                                                  | 11        

---

PART IFINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

Golden Elephant Glass Technology, Inc. CondensedConsolidated
Financial Statementsthe three and six months ended June 30, 2010 and 2009

---

|Golden Elephant Glass Technology, Inc.    |   |             |  |   |              | 
|----------------------------------------- | - | ----------- |  | - | ------------ | 
|Condensed Consolidated Balance Sheets     |   |             |  |   |              | 
|As of June 30, 2010 and December 31, 2009 |   |             |  |   |              | 
|(Stated in US Dollars)                    |   |             |  |   |              | 
|                                          |   | June 30,    |  |   | December 31, | 
|                                          |   | 2010        |  |   | 2009         | 
|                                          |   | (Unaudited) |  |   | (Audited)    | 
|ASSETS                                    |   |             |  |   |              | 
|Current assets                            |   |             |  |   |              | 
|Cash and cash equivalents                 | $ | 7,192       |  | $ | 7,358        | 
|Restricted cash                           |   | -           |  |   | -            | 
|Trade receivables, net                    |   | 3,913,031   |  |   | 3,883,810    | 
|Other receivables, net                    |   | 1,782,413   |  |   | 1,886,300    | 
|Prepayments                               |   | 2,595,283   |  |   | 2,795,202    | 
|Inventories                               |   | 1,583,855   |  |   | 1,572,028    | 
|Amount due from a related party           |   | -           |  |   | -            | 
|Deferred taxes                            |   | -           |  |   | -            | 
|Total current assets                      |   | 9,881,774   |  |   | 10,144,698   | 
|Non-current assets                        |   |             |  |   |              | 
|Property, plant and equipment, net        |   | 21,906,696  |  |   | 23,046,810   | 
|Land use right                            |   | 2,842,597   |  |   | 2,855,361    | 
|Deferred taxes                            |   | -           |  |   | -            | 
|TOTAL ASSETS                              | $ | 34,631,067  |  | $ | 36,046,869   | 

See the accompanying notes to condensed consolidated financial
statements

F-1

---

Golden Elephant Glass Technology, Inc. Condensed
Consolidated Balance Sheets (Contd) As of June 30, 2010 and 2009
(Stated in US Dollars)

|                                                            |   | June 30,    |   |   | December 31, |  
|----------------------------------------------------------- | - | ----------- | - | - | ------------ | -
|                                                            |   | 2010        |   |   | 2009         |  
|                                                            |   | (Unaudited) |   |   | (Audited)    |  
|LIABILITIES AND STOCKHOLDERS
      EQUITY                  |   |             |   |   |              |  
|                                                            |   |             |   |   |              |  
|LIABILITIES                                                 |   |             |   |   |              |  
|Current liabilities                                         |   |             |   |   |              |  
|Trade payables                                              | $ | 10,387,695  |   | $ | 10,307,198   |  
|Bills payable                                               |   | 724,640     |   |   | 719,228      |  
|Other payables and accrued expenses                         |   | 3,065,850   |   |   | 3,136,502    |  
|Sales receipt in advance                                    |   | 504,608     |   |   | 314,423      |  
|Interest payable                                            |   | 2,971,223   |   |   | 2,032,329    |  
|Tax payable                                                 |   | 2,515,173   |   |   | 2,496,391    |  
|Amount due to a director                                    |   | 105,143     |   |   | 104,358      |  
|Amount due to a related party                               |   | -           |   |   | -            |  
|Secured short-term bank loans                               |   | 12,861,352  |   |   | 12,765,307   |  
|Loan from related party - Lin Tan                           |   | 485,157     |   |   | 631,657      |  
|TOTAL LIABILITIES                                           | $ | 33,620,841  |   | $ | 32,507,393   |  
|STOCKHOLDERS EQUITY                                        |   |             |   |   |              |  
|Preferred stock: par value $0.01 per share
      Authorized |   |             |   |   |              |  
|10,000,000 shares, none issued and
      outstanding        |   |             |   |   |              |  
|Common stock: par value $0.01 per share, Authorized         |   |             |   |   |              |  
|150,000,000 shares; issued and
      outstanding            |   |             |   |   |              |  
|28,623,996 shares in 2009 and 2008                          |   | 286,240     |   |   | 286,240      |  
|Additional paid-in capital                                  |   | 12,001,927  |   |   | 12,001,927   |  
|Statutory reserves                                          |   | 714,013     |   |   | 714,013      |  
|Accumulated other comprehensive
      income                |   | 2,119,918   |   |   | 2,099,065    |  
|Accumulated deficit                                         |   | (14,111,872 | ) |   | (11,561,769  | )
|TOTAL STOCKHOLDERSEQUITY                                   |   | 1,010,226   |   |   | 3,539,476    |  
|TOTAL LIABILITIES AND STOCKHOLDERSEQUITY                   | $ | 34,631,067  |   | $ | 36,046,869   |  

See the accompanying notes to condensed consolidated financial
statements

F-2

---

Golden Elephant Glass Technology, Inc.Condensed
Consolidated Statements of Operations and Comprehensive (Loss) Income For
the three and six months ended June 30, 2010 and 2009 (Unaudited)(Stated in US Dollars)

|                                                      |   | Three months
      ended |   |   | Six months
      ended |  
|----------------------------------------------------- | - | ------------------------ | - | - | ---------------------- | -
|                                                      |   | June 30,                 |   |   | June 30,               |  
|                                                      |   | (Unaudited)              |   |   | (Unaudited)            |  
|                                                      |   | 2010                     |   |   | 2009                   |  
|Sales revenues                                        | $ | -                        |   | $ | -                      |  
|Cost of sales                                         |   | -                        |   |   | -                      |  
|Gross loss                                            |   | -                        |   |   | -                      |  
|Other operating income                                |   |                          |   |   |                        |  
|Bad debts recovered                                   |   | -                        |   |   | -                      |  
|Decrease in provision for bad debts                   |   | -                        |   |   | -                      |  
|Gain on disposal of a subsidiary                      |   | -                        |   |   | -                      |  
|Total
      other operating income                    |   | -                        |   |   | -                      |  
|Operating expenses                                    |   |                          |   |   |                        |  
|Administrative expenses                               |   | 817,623                  |   |   | 2,756,308              |  
|Selling expenses                                      |   |                          |   |   |                        |  
|Total operating expenses                              |   | 817,623                  |   |   | 2,756,308              |  
|Loss from operations                                  |   | (817,623                 | ) |   | (2,756,308             | )
|Interest income                                       |   | -                        |   |   | 11,667                 |  
|Other income                                          |   | -                        |   |   | 349                    |  
|Government grants                                     |   | -                        |   |   | -                      |  
|Finance costs                                         |   | (492,227                 | ) |   | (851,635               | )
|Loss before income taxes                              |   | (1,309,850               | ) |   | (3,595,927             | )
|Income taxes                                          |   | -                        |   |   | 19,701                 |  
|Net income                                            |   | (1,309,850               | ) |   | (3,576,226             | )
|Other comprehensive income                            |   |                          |   |   |                        |  
|Foreign currency translation adjustments              |   | 13,831                   |   |   | 3,115                  |  
|Comprehensive loss                                    | $ | (1,296,020               | ) | $ | (3,573,111             | )
|Loss per share:                                       |   |                          |   |   |                        |  
|basic and
      diluted                               | $ | (0.05                    | ) | $ | (0.12                  | )
|Weighted average number of shares
      outstanding : |   |                          |   |   |                        |  
|basic and
      diluted                               |   | 28,623,996               |   |   | 28,623,996             |  

See the accompanying notes to condensed consolidated financial
statements

F-3

---

Golden Elephant Glass Technology, Inc. Condensed
Consolidated Statements of Cash Flows For the six months ended June 30, 2010
and 2009 (Unaudited) (Stated in US Dollars)

|                                                                   |   | Six months
      ended |  
|------------------------------------------------------------------ | - | ---------------------- | -
|                                                                   |   | June 30,               |  
|                                                                   |   | (Unaudited)            |  
|                                                                   |   | 2010                   |  
|Cash flows from operating
      activities                         |   |                        |  
|Net (loss) income                                                  | $ | (2,550,103             | )
|Adjustments to reconcile net loss
      to net cash flows          |   |                        |  
|provided by (used in) operating activities:                        |   |                        |  
|Depreciation                                                       |   | 1,438,059              |  
|Amortization of land use right                                     |   | 38,340                 |  
|Deferred taxes                                                     |   | -                      |  
|Provision (recovery) for doubtful accounts                         |   | -                      |  
|Provision for obsolete inventories                                 |   | -                      |  
|Changes in operating assets and liabilities :                      |   |                        |  
|Trade
      receivables                                            |   | -                      |  
|Bills receivable                                                   |   | -                      |  
|Other
      receivables                                            |   | (51,438                | )
|Prepayments and other
      current assets                         |   | 199,919                |  
|Inventories                                                        |   | -                      |  
|Trade payables                                                     |   | 80,497                 |  
|Bills
      payable                                                |   | -                      |  
|Other payables and
      accrued expenses                          |   | 559,987                |  
|Sales
      receipt in advance                                     |   | 190,185                |  
|Income tax payable                                                 |   | -                      |  
|Amount
      due to a director                                     |   | -                      |  
|Net cash flows provided by (used in) operating
      activities    |   | (94,544                | )
|Cash flows from investing
      activities                         |   |                        |  
|Payments to acquire property, plant and equipment                  |   | -                      |  
|Sales proceeds for disposal of
      property, plant and equipment |   | -                      |  
|Payments to construction in progress                               |   | -                      |  
|Decrease in restricted cash                                        |   | -                      |  
|Net cash flows (used in) provided by investing
      activities    | $ | -                      |  

See the accompanying notes to condensed consolidated financial
statements

F-4

---

|Golden Elephant Glass Technology, Inc.                                                  |   |                        |   |   |           |  
|--------------------------------------------------------------------------------------- | - | ---------------------- | - | - | --------- | -
|Condensed Consolidated Statements of Cash Flows
      (Contd)                          |   |                        |   |   |           |  
|For the six months ended June 30, 2010 and
      2009                                   |   |                        |   |   |           |  
|(Unaudited)                                                                             |   |                        |   |   |           |  
|(Stated in US Dollars)                                                                  |   |                        |   |   |           |  
|                                                                                        |   | Six months
      ended |  
|                                                                                        |   | June 30,               |  
|                                                                                        |   | (Unaudited)            |  
|                                                                                        |   | 2010                   |   |   | 2009      |  
|Cash flows from financing
      activities                                              |   |                        |   |   |           |  
|Proceeds from bank loans                                                                |   | -                      |   |   | -         |  
|Repayment of bank loans                                                                 |   | -                      |   |   | -         |  
|Net cash flows provided by financing
      activities                                   |   | -                      |   |   | -         |  
|Effect of foreign currency translation
      on cash and cash equivalents               |   | 94,388                 |   |   | (82       | )
|Net decrease in cash and cash equivalents                                               |   | (166                   | ) |   | (127,740  | )
|Cash and cash equivalents -
      beginning of period                                   |   | 7,358                  |   |   | 141,419   |  
|Cash and cash equivalents - end of period                                               | $ | 7,192                  |   | $ | 13,679    |  
|Supplemental disclosures for cash
      flow information:                               |   |                        |   |   |           |  
|Cash paid for :                                                                         |   |                        |   |   |           |  
|Interest                                                                                |   | -                      |   |   | -         |  
|Income taxes                                                                            |   | -                      |   |   | -         |  
|                                                                                        |   |                        |   |   |           |  
|Non-cash investing and financing activities                                             |   |                        |   |   |           |  
|Partial of unsecured loan offset by
      advances to related parties                   |   | -                      |   |   | -         |  
|Amount due from a related party settled by offsetting the
      loan from related party | $ | 146,500                |   | $ | 1,108,343 |  

See the accompanying notes to consolidated financial statements

F-5

---

Golden Elephant Glass Technology, Inc.Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|1. | Organization and Nature of Business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | Golden Elephant Glass Technology, Inc. (the Company)
      (formerly Nevstar Corporation), was incorporated in the State of Nevada on
      December 2, 1993.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The Company is engaged in the manufacture and
      distribution of float glasses in the Peoples Republic of China (the
      PRC). The Company's product offerings include float glass, ultra-clear
      glass, colored float glass and high grade glass processed products, and
      are marketed primarily under the "Golden Elephant" brand name.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | During the global economic crisis in 2008, many of
      customers operate in industry segments that have been hardest hit by the
      economic crisis. The companys performance was consequently suffered.
      Since November 2008, the Company has suspended operations of float glass
      production lines in order to perform maintenance and system upgrades. The
      maintenance program is still in process.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|2. | Basis of Presentation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The accompanying unaudited condensed consolidated
      financial statements of the Company and its subsidiaries have been
      prepared in accordance with the rules and regulations of the Securities
      and Exchange Commission (the SEC) including the instructions to Form
      10-Q and Regulation S-X. Certain information and note disclosures normally
      included in financial statements prepared in accordance with generally
      accepted accounting principles in the United States of America have been
      condensed or omitted from these statements pursuant to such rules and
      regulation and, accordingly, they do not include all the information and
      notes necessary for comprehensive consolidated financial statements and
      should be read in conjunction with our audited consolidated financial
      statements for the year ended December 31, 2009, included in our Annual
      Report on Form 10-K for the year ended December 31, 2009.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | In the opinion of the management of the Company, all
      adjustments, which are of a normal recurring nature, necessary for a fair
      statement of the results for the three-month periods have been made.
      Results for the interim period presented are not necessarily indicative of
      the results that might be expected for the entire fiscal year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|3. | Going Concern                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The accompanying consolidated financial statements have
      been prepared assuming that the Company will continue as a going concern,
      which contemplates the realization of assets and the liquidation of
      liabilities in the normal course of business.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The Company incurred a net loss of $2,550,103 for the six
      months ended June 30, 2010 and had accumulated deficits of $14,111,872 as
      of June 30, 2010. In addition, the Company has been implementing a
      maintenance program for the float glass production lines since November
      2008. During the maintenance period, all operations of the production
      lines and all manufacturing of the glass products are suspended. These
      matters raise substantial doubt about the Companys ability to continue as
      a going concern.                                                                                                                                                                                                                                                                                                                                                                                                                                    

The management believes that the
suspension of production lines during deteriorating global economic environment
provides an opportunity to mitigate the negative economic impact. Other than the
routine maintenance, the Companys maintenance program also involves upgrades to
its production lines. In addition, with the improvement of economic environment
and glass market, the management is attempting to implement its business plan of
restoring the production lines, and is seeking additional private sources of
equity or debt financing. However, there is no assurance these activities will
be successful. The accompanying financial statements do not include any
adjustments that might be necessary if the Company is unable to continue as a
going concern.

F-6

---

Golden Elephant Glass Technology, Inc.Notes to
Condensed Consolidated Financial Statements(Unaudited) (Stated in US
Dollars)

|4. | Summary of significant accounting policies
|-- | ------------------------------------------

Principles of
consolidation

The consolidated financial statements
include the accounts of the Company and its subsidiaries. All significant
inter-company accounts and transactions have been eliminated in consolidation.
The results of subsidiary acquired or disposed of during the years are included
in the consolidated statements of operations and comprehensive (loss) income
from the effective date of acquisition or up to the date of disposal.

Use of estimates

In preparing financial statements in
conformity with accounting principles generally accepted in the United States of
America, management makes estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosures of contingent assets and
liabilities at the dates of the financial statements, as well as the reported
amounts of revenues and expenses during the reporting periods. These accounts
and estimates include, but are not limited to, the valuation of accounts
receivable, inventories, deferred income taxes, provision for warranty and the
estimation on useful lives of property, plant and equipment. Actual results
could differ from those estimates. Critical accounting estimates used in
preparation of the financial statements include managements judgments about its
valuation of the allowance for bad debt.

Concentrations of credit
risk

Financial instruments that potentially
subject the Company to significant concentrations of credit risk consist
principally of cash and cash equivalents, trade receivables and other
receivables. As of June 30, 2010 and December 31, 2009, substantially all of the
Companys cash and cash equivalents and restricted cash were held by major
financial institutions located in the PRC, which management believes are of high
credit quality. With respect to other receivables and trade receivables, the
Company extends credit based on an evaluation of the customers financial
condition. The Company generally does not require collateral for trade
receivables and other receivables and maintains an allowance for doubtful
accounts of trade receivables and other receivables. The Company conducts
periodic reviews of its customers' financial condition and customer payment
practices to minimize collection risk on accounts receivable.

Details of customers for 10% or more of
the Companys trade receivables are:

| |           |  |   | As of June 30, | 
| | --------- |  | - | -------------- | 
| |           |  |   | 2010           | 
| |           |  |   | (Unaudited)    | 
| | Company A |  | $ | 1,649,929      | 
| | Company B |  |   | 610,313        | 
| | Company C |  |   | 559,878        | 
| | Company D |  |   | 479,610        | 
| | Totals    |  | $ | 3,299,730      | 

F-7

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|4. | Summary of significant accounting policies (Contd)
|-- | ---------------------------------------------------

Cash and cash
equivalents

Cash and cash equivalents include all
cash, deposits in banks and other highly liquid investments with initial
maturities of three months or less to be cash equivalents. As of June 30, 2010
and December 31, 2009, almost all the cash and cash equivalents were denominated
in Renminbi (RMB) and were placed with banks in the PRC. They are not freely
convertible into foreign currencies and the remittance of these funds out of the
PRC is subject to exchange control restrictions imposed by the PRC government.
The remaining insignificant balance of cash and cash equivalents were
denominated in US dollars.

Allowance for doubtful
accounts

The Company establishes an allowance
for doubtful accounts based on managements assessment of the collectability of
trade receivables and other receivables. A considerable amount of judgment is
required in assessing the amount of the allowance; the Company considers the
historical level of credit losses and applies percentages to aged receivable
categories. The Company makes judgment about the creditworthiness of each
customer based on ongoing credit evaluations, and monitors current economic
trends that might impact the level of credit losses in the future. If the
financial condition of the customers were to deteriorate, resulting in their
inability to make payments, a larger allowance may be required.

Allowance for doubtful accounts
(Contd)

Based on the above assessment, during
the reporting years, management establishes a general provisioning policy to
make the allowance equivalent to 10% of gross amount of trade receivables and
other receivables due over 6-12 months, 25% gross amount of trade receivables
and other receivables due over 1-2 years and 50% of gross amount of trade
receivables and other receivables due over 2-3 years and 100% of gross amount of
trade receivables and other receivables due over 3 years. Additional specific
provision is made against trade receivables aged less than 6 months to the
extent which they are considered to be doubtful.

Bad debts are written off when
identified. The Company extends unsecured credit to customers ranging from three
to six months in the normal course of business. The Company does not accrue
interest on trade receivables.

Historically, losses from uncollectible
accounts have not significantly deviated from the general allowance estimated by
management and no significant additional bad debts have been written off
directly to the profit and loss. This general provisioning policy has not
changed in the past since establishment and management considers that the
aforementioned general provisioning policy is adequate and not too excessive and
does not expect to change this established policy in the near future.

Inventories

Inventories are stated at the lower of
cost or market value. Cost is determined on a weighted average basis and
includes all expenditures incurred in bringing the goods to the point of sale
and putting them in a saleable condition. In assessing the ultimate realization
of inventories, management makes judgment as to future demand requirements
compared to current or committed inventory levels. The reserve requirements
generally increase as the projected demand requirements, decrease due to market
conditions, product life cycle changes. The Company estimates the demand
requirements based on market conditions, forecasts prepared by its customers,
sales contracts and orders in hand.

In addition, the Company estimates net
realizable value based on intended use, current market value and inventory aging
analyses. The Company writes down the inventories for estimated

F-8

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|4. | Summary of significant accounting policies (Contd)
|-- | ---------------------------------------------------

Inventories (Contd)

obsolescence or unmarketable inventory
equal to the difference between the cost of inventories and the estimated market
value based upon assumptions about future demand and market conditions.

Historically, the actual net realizable
value is close to the management estimation.

Property, plant and
equipment

Property, plant and equipment are
stated at cost less accumulated depreciation. Cost represents the purchase price
of the asset and other costs incurred to bring the asset into its existing use.

Depreciation is provided on
straight-line basis over their estimated useful lives. The principal
depreciation rates are as follows: -

| |                        | Annual rate |  | Residual value
| | ---------------------- | ----------- |  | --------------
| | Buildings              | 3.8%        |  | 5%            
| | Machinery and tools    | 9.5%        |  | 5%            
| | Motor vehicles         | 11.875%     |  | 5%            
| | Office equipment       | 19%         |  | 5%            
| | Leasehold improvements | 12.5%       |  | Nil           

Construction in progress mainly
represents expenditures in respect of the Companys warehouses and factories
under construction. All direct costs relating to the acquisition or construction
of the Companys warehouses and factories are capitalized as construction in
progress. No depreciation is provided in respect of construction in progress.

Maintenance or repairs are charged to
expense as incurred. Significant improvements and renewals that extend the
useful life of the asset are capitalized. Upon sale or disposition, the
applicable amounts of asset cost and accumulated depreciation are removed from
the accounts and the net amount less proceeds from disposal is charged or
credited to income.

Land use right

Land use right is stated at cost less
accumulated amortization. Amortization is provided using the straight-line
method over the terms of the lease of 50 years obtained from the relevant PRC
land authority.

Goodwill

Goodwill represents the excess of the
purchase price of an acquired business over the fair value of the identifiable
assets acquired and liabilities assumed. Pursuant to the provisions of SFAS No.
142 Goodwill and Other Intangible Assets, goodwill is not amortized and is
subjected to an annual impairment test which occurs in the fourth quarter of
each fiscal year.

Goodwill will be written down only when
and if impairment is identified and measured, based on future events and
conditions.

F-9

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|4. | Summary of significant accounting policies (Contd)
|-- | ---------------------------------------------------

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------
| | Impairment of long-lived assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | Long-lived assets are tested for impairment in accordance with SFAS No. 144 and Accounting Principles Board (APB) Opinion 18, Equity Method of Accounting for Investments in Common Stock, respectively. The Company
periodically evaluates potential impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. The Company recognizes impairment of long-lives assets and investment in an affiliate in
the event that the net book values of such assets exceed the future undiscounted cash flows attributable to such assets.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | The Companys long-lived assets include property, plant and equipment, construction in progress, goodwill and land use right. These assets were reviewed for impairment whenever events or circumstances indicate that their
carrying values may not be recoverable.                                                                                                                                                                                                                                                                                                                                    
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | The following are examples of such events or changes in circumstances:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | An adverse change in the business climate or market price of a long-lived assets;                                                    
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | An adverse change in the extent or manner in which a long-lived assets is used or in its physical condition; or                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Current operating losses for long-lived assets or projected or forecasted losses that demonstrate that the losses will be continuing.
| | Revenue recognition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | Revenue from sales of the Companys products is recognized when the significant risks and rewards of ownership have been transferred to the buyer, the sales price is fixed or determinable and collection is reasonably
assured.                                                                                                                                                                                                                                                                                                                                                                       
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | Advertising and research and development expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | Advertising, research and development expenses are charged to expense as incurred.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | Research and development expenses consist primarily of remuneration for research and development staff and material costs for research and development.                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | Stock-based compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | The Company adopted the provisions of SFAS No. 123R, which requires the use of the fair value method of accounting for share-based compensation. Under the fair value based method, compensation cost related to employee stock
options or similar equity instruments which are equity-classified awards, is measured at the grant date based on the value of the award and is recognized over the requisite service period, which is usually the vesting period. SFAS 123R also requires
measurement of cost of a liability-classified award based on its current fair value.                          
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | Government grant                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                      
| | Government grant income represents the cash receipt from the relevant government authorities for technical development. Such government grant is unconditional, non-refundable and without any restrictions on usage at the time of
grant to and receipt by the Company. Government grant is recognized as income at the time when the approval documents are obtained from the relevant government authorities and when they are received.                                                                                                                                                             

F-10

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|4. | Summary of significant accounting policies (Contd)
|-- | ---------------------------------------------------

Income taxes

The Company uses the asset and
liability method of accounting for income taxes pursuant to SFAS No. 109
Accounting for Income Taxes. Under the asset and liability method of SFAS No.
109, deferred tax assets and liabilities are recognized for the future tax
consequences attributable to temporary differences between the financial
statements carrying amounts of existing assets and liabilities and loss carry
forwards and their respective tax bases. Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable income in the
years in which those temporary differences are expected to be recovered or
settled.

Value Added Tax

All China-based enterprises are subject
to a value added tax (VAT) imposed by the PRC government on their domestic
product sales. The output VAT is charged to customers who purchase goods from
the Company and the input VAT is paid when the Company purchases goods from its
vendors. The input VAT can be offset against the output VAT. The VAT payable
represents the input VAT less than the output VAT. The debit balance represents
a credit against future collection of output VAT.

Comprehensive income

The Company has adopted SFAS No. 130,
Reporting Comprehensive Income, which establishes standards for reporting and
display of comprehensive income, its components and accumulated balances.
Components of comprehensive income include net income and less foreign currency
translation adjustments.

Foreign currency
translation

The functional currency of the Company
is RMB and RMB is not freely convertible into foreign currencies. The Company
maintains its financial statements in the functional currency. Monetary assets
and liabilities denominated in currencies other than the functional currency are
translated into the functional currency at rates of exchange prevailing at the
balance sheet date. Transactions denominated in currencies other than the
functional currency are translated into the functional currency at the exchanges
rates prevailing at the dates of the transaction. Exchange gains or losses
arising from foreign currency transactions are included in the determination of
net income for the respective periods.

For financial reporting purposes, the
financial statements of the Company which are prepared using the functional
currency have been translated into United States dollars. Assets and liabilities
are translated at the exchange rates at the balance sheet dates and revenue and
expenses are translated at the average exchange rates and stockholders equity
is translated at historical exchange rates. Any translation adjustments
resulting are not included in determining net income but are included in foreign
exchange adjustment to other comprehensive income, a component of stockholders
equity. The exchange rates in effect at June 30, 2010 and December 31, 2009 were
RMB1 for $0.1473 and $0.1462 respectively. There is no significant fluctuation
in exchange rate for the conversion of RMB to US dollars after the balance sheet
date.

Fair value of financial
instruments

The accounting standards regarding fair
value of financial instruments and related fair value measurements defines
financial instruments and requires fair value disclosures of those financial
instruments. This accounting standard defines fair value, establishes a
three-level valuation hierarchy for disclosures of fair value measurement and
enhances disclosures requirements for fair value measures. Current assets and
current liabilities qualified as financial instruments and management believes
their carrying amounts are a reasonable estimate of fair value because of

F-11

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|4. | Summary of significant accounting policies (Contd)
|-- | ---------------------------------------------------

Fair value of financial instruments
(Contd)

the short period of time between the
origination of such instruments and their expected realization and if
applicable, their current interest rate is equivalent to interest rates
currently available.

As of June 30, 2010, the carrying
amounts of the Companys financial instruments, including cash and cash
equivalents, trade and other receivables, trade, bills and other payables,
short-term bank loans and loan from Lin Tan approximate their fair values due to
the short-term maturity.

Basic and diluted earnings (loss)
per share

The Company reports basic earnings
(loss) per share in accordance with SFAS No. 128, Earnings Per Share. Basic
earnings (loss) per share is computed using the weighted average number of
shares outstanding during the periods presented. The weighted average number of
shares of the Company represents the common stock outstanding during the
reporting periods.

Diluted earnings (loss) per share is
computed using the weighted average number of common shares outstanding during
the periods plus the effect of dilutive securities outstanding during the
periods.

Off-balance sheet
arrangements

The Company does not have any
off-balance sheet arrangements.

Recently issued accounting
pronouncements

Adoption of FASB Accounting Standards
Codification

In June 2009, the FASB issued SFAS No.
168, " The FASB Accounting Standards Codification and the Hierarchy of Generally
Accepted Accounting Principlesa replacement of FASB Statement No. 162 ". This
standard is now included in ASC Topic 105 and established only two levels of
GAAP, authoritative and non-authoritative. The FASB Accounting Standards
Codification (the "Codification") became the source of authoritative,
non-governmental GAAP, except for rules and interpretive releases of the SEC,
which are sources of authoritative GAAP for SEC registrants. All other
non-grandfathered, non-SEC accounting literature not included in the
Codification became non-authoritative. This standard is effective for financial
statements for interim or annual reporting periods ending after September 15,
2009. Effective August 1, 2009, we adopted the new guidelines and numbering
system prescribed by the Codification when referring to GAAP. The adoption had
no impact on our consolidated financial condition, results of operations or cash
flows.

Adoption of FASB ASC 805

Effective January 1, 2009, the Company
adopted FASB ASC 805, Business Combinations. FASB ASC 805 changed accounting
for acquisitions that close beginning in 2009. FASB ASC 805 extends its
applicability to all transactions and other events in which one entity obtains
control over one or more other businesses. It broadens the fair value
measurement and recognition of assets acquired, liabilities assumed, and
interests transferred as a result of business combinations. FASB ASC 805 expands
on required disclosures to improve the statement users abilities to evaluate
the nature and financial effects of business combinations. The adoption of FASB
ASC 805 did not have a material impact on the Companys financial statements.

F-12

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|4. | Summary of significant accounting policies (Contd)
|-- | ---------------------------------------------------

Recently issued accounting
pronouncements (Contd)

Adoption of FASB ASC 805-20

Effective January 1, 2009, the Company
adopted FASB ASC 805-20, Non controlling Interests in Consolidated Financial
Statements. FASB ASC 805-20 requires that a non controlling interest in a
subsidiary be reported as equity and the amount of consolidated net income
specifically attributable to the non controlling interest be identified in the
consolidated financial statements. It also calls for consistency in the manner
of reporting changes in the parents ownership interest and requires fair value
measurement of any non controlling equity investment retained in a
deconsolidation. FASB ASC 805-20 requires retroactive adoption of the
presentation and disclosure requirements for existing minority interests. The
adoption FASB ASC 805-20 did not have material impact on the Companys financial
statements.

Adoption of FASB ASC 815

Effective January 1, 2009, the Company
adopted FASB ASC 815, Disclosures about Derivative Instruments and Hedging
Activities. FASB ASC 815 requires enhanced disclosures about (i) how and why
the Company uses derivative instruments, (ii) how the Company accounts for
derivative instruments and related hedged items, and (iii) how derivative
instruments and related hedged items affect the Companys financial results. The
adoption FASB ASC 815 did not have any impact on the Companys financial
statements.

Adoption of FASB ASC 350-30

Effective January 1, 2009, the Company
adopted FASB ASC 350-30, Determination of the Useful Life of Intangible
Assets. FASB ASC 350-30 amended the factors that should be considered in
developing renewal or extension assumptions used to determine the useful life of
a recognized intangible asset. The adoption of FASB ASC 350-30 did not have
material impact on the Companys financial statements.

Adoption of FASB ASC 860

In June 2009, the FASB issued ASC 860,
which eliminates the concept of a qualifying special-purpose entity, creates
more stringent conditions for reporting a transfer of a portion of a financial
asset as a sale, clarifies other sale-accounting criteria, and changes the
initial measurement of a transferors interest in transferred financial assets.
FASB ASC 860 will be effective for transfers of financial assets in years
beginning after November 15, 2009 and in interim periods within those years with
earlier adoption prohibited. The adoption of ASC 860 is not expected to have a
material impact on our consolidated financial position or results of operations.

Adoption of FASB ASU 2009-05

In August 2009, the FASB issued
Accounting Standards Update ("ASU") No. 2009-05, "Measuring Liabilities at Fair
Value," which amends the guidance in ASC 820, Fair Value Measurements and
Disclosures, to provide guidance on fair value measurement of liabilities. If a
quoted price in an active market is not available for an identical liability,
ASU 2009-05 requires companies to compute fair value by using quoted prices for
an identical liability when traded as an asset, quoted prices for similar
liabilities when traded as an asset or another valuation technique that is
consistent with the guidance in ASC 820. ASU 2009-05 will be effective for
interim and annual periods beginning after its issuance and did not have a
material impact on our consolidated financial position or results of operations.

F-13

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|4. | Summary of significant accounting policies
      (Contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | Recently issued accounting pronouncements
      (Contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | Adoption of FASB ASU 2009-13                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | In October 2009, the FASB issued ASU No. 2009-13,
      Multiple-Deliverable Revenue Arrangements (ASU 2009-13). This update
      removes the criterion that entities must use objective and reliable
      evidence of fair value in separately accounting for deliverables and
      provides entities with a hierarchy of evidence that must be considered
      when allocating arrangement consideration. The new guidance also requires
      entities to allocate arrangement consideration to the separate units of
      accounting based on the deliverables relative selling price. The
      provisions will be effective for revenue arrangements entered into or
      materially modified in our year 2011 and must be applied prospectively. We
      are currently evaluating the impact of the provisions of ASU
    2009-13.                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|5. | Income taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | United States                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | The Company is incorporated in the United States of
      America and is subject to United States of America tax law. No provisions
      for income taxes have been made as the Company has no taxable income for
      the reporting periods. The applicable income tax rates for the Company for
      the reporting periods are 34%. The Company has not provided deferred taxed
      on undistributed earnings of its non-U.S. subsidiaries as of March 31,
      1010, as it is the Companys current policy to reinvest these earnings in
      non-U.S. operations.                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | BVI                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | Dollar Come was incorporated in the BVI and, under the
      current laws of the BVI, is not subject to income taxes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | PRC                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | Before the implementation of the new enterprise income
      tax (EIT) law (as discussed below), Foreign Invested Enterprises (FIE)
      established in the PRC are generally granted certain benefits or holiday
      by the relevant tax authority. On March 16, 2007, the National Peoples
      Congress of China passed the new Corporate Income Tax Law (EIT Law), and
      on November 28, 2007, the State Council of China passed the Implementing
      Rules for the EIT Law (Implementing Rules) which took effect on January
      1, 2008. The EIT Law and Implementing Rules impose a unified EIT of 25% on
      all domestic-invested enterprises and FIEs, unless they qualify under
      certain limited exceptions. Therefore, nearly all FIEs are subject to the
      new tax rate alongside other domestic businesses rather than benefiting
      from the old tax laws applicable to FIEs, and its associated preferential
      tax treatments, beginning January 1, 2008.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | Despite these changes, the EIT Law gives the FIEs
      established before March 16, 2007 (Old FIEs), such as our subsidiary
      Fuxin Hengrui and Xianheng, a five-year grandfather period during which
      they can continue to enjoy their existing preferential tax treatments.
      During this five-year grandfather period, the Old FIEs which enjoyed tax
      rates lower than 25% under the original EIT Law shall gradually increase
      their EIT rate by 2% per year until the tax rate reaches 25%. In addition,
      the Old FIEs that are eligible for the two-year exemption and three-year
      half reduction or five-year exemption and five-year half-reduction
      under the original EIT Law, are allowed to remain to enjoy their
      preference until these holidays expire.                                                                                                                                                                                       

As approved by the relevant PRC tax
authority, Fuxin Hengrui and Xianheng was entitled to a two-year exemption from
EIT followed by a 50% tax exemption for the next three years, commencing from
the first cumulative profit-making year in the fiscal financial year. The tax

F-14

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|5. | Income taxes (Contd)
|-- | ---------------------

holiday of Fuxin Hengrui commenced in
2004. Accordingly, Fuxin Hengrui is entitled to a 50% reduction on EIT tax rate
of 12.5% for 2008 and will be subject to an EIT rate of 25% from 2009.
Xianhengs tax holiday commenced in 2008, therefore, Xianheng is exempted from
EIT in 2008 and 2009 and will be subject to a reduced EIT rate of 12.5% from
2010 to 2012.

|6. | Loss per share
|-- | --------------

During the reporting periods, the basic
and diluted loss per share are the same.

The per share data reflects the
recapitalization of stockholders equity as if the reorganization occurred as of
the beginning of the first period presented.

|7. | Inventories
|-- | -----------

| |                        |   | June 30,    |  |   | December 31, | 
| | ---------------------- | - | ----------- |  | - | ------------ | 
| |                        |   | 2010        |  |   | 2009         | 
| |                        |   | (Unaudited) |  |   | (Audited)    | 
| | Raw materials          | $ | 262,638     |  | $ | 260,677      | 
| | Finished goods         |   | 1,279,509   |  |   | 1,473,530    | 
| | Consumables            |   | 41,708      |  |   | 41,397       | 
| | Balance at end of year | $ | 1,583,855   |  | $ | 1,572,028    | 

As of June 30, 2010, finished goods
with carrying value of $ 1,279,509 were pledged to the banks for the bank loans
granted to the Company.

|8. | Property, plant and equipment
|-- | -----------------------------

| |                          |   | June 30,    |   |   | December 31, |  
| | ------------------------ | - | ----------- | - | - | ------------ | -
| |                          |   | 2010        |   |   | 2009         |  
| |                          |   | (Unaudited) |   |   | (Audited)    |  
| | Costs:                   |   |             |   |   |              |  
| | Buildings                | $ | 14,475,957  |   | $ | 14,367,853   |  
| | Plant and machinery      |   | 19,648,052  |   |   | 19,501,325   |  
| | Office equipment         |   | 129,861     |   |   | 128,891      |  
| | Leasehold improvements   |   | 3,890,433   |   |   | 3,861,381    |  
| | Motor vehicles           |   | 365,277     |   |   | 362,550      |  
| | Construction in progress |   | 1,387,999   |   |   | 1,377,634    |  
| |                          |   | 39,897,579  |   |   | 39,599,634   |  
| | Accumulated depreciation |   | (17,990,883 | ) |   | (16,552,824  | )
| | Net                      | $ | 21,906,696  |   | $ | 23,046,810   |  

As of June 30, 2010, certain property,
plant and equipment with aggregate net book value of $10,460,220 were pledged to
banks to secure general banking facilities.

|9. | Land use right
|-- | --------------

| |                          |   | June 30,    |   |   | December 31, |  
| | ------------------------ | - | ----------- | - | - | ------------ | -
| |                          |   | 2010        |   |   | 2009         |  
| |                          |   | (Unaudited) |   |   | (Audited)    |  
| | Land use right           | $ | 3,424,816   |   | $ | 3,399,240    |  
| | Accumulated amortization |   | (582,219    | ) |   | (543,879     | )
| | Net                      | $ | 2,842,597   |   | $ | 2,855,361    |  
| |                          |   |             |   |   |              |  

F-15



---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|9. | Land use right (Contd)
|-- | -----------------------

The Company obtained the right from the
relevant PRC land authority for a period from November 20, 2002 to September 18,
2052 to use the lands on which the office premises, production facilities and
warehouse of the Company are situated. The Company pledged this right to a bank
as part of its borrowings from the bank.

|10. | Secured short-term bank loans
|--- | -----------------------------

| |                                          |   | June 30,    |  |   | December 31, | 
| | ---------------------------------------- | - | ----------- |  | - | ------------ | 
| |                                          |   | 2010        |  |   | 2009         | 
| |                                          |   | (Unaudited) |  |   | (Audited)    | 
| | Bank loans repayable
      within 1 year | $ | 12,861,352  |  | $ | 12,765,307   | 

As of June 30, 2010, the Companys
banking facilities were as follows:

| | Facilities granted       |  |   | Granted    |  |   | Amount utilized |  |   | Unused | 
| | ------------------------ |  | - | ---------- |  | - | --------------- |  | - | ------ | 
| | Secured
      bank loans |  | $ | 12,861,352 |  | $ | 12,861,352      |  | $ | -      | 

The above banking facilities are
secured by the following:

(i) Finished goods with carrying value
of $ 1,279,509;

(ii) Property, plant and equipment with
carrying value of $10,460,220; (iii) Land use right with carrying value of
$2,842,597; (iv) Guarantee executed by Lin Tan and third parties.

|11. | Amount due to a director
|--- | ------------------------

The amount represents other payable due
to Mr. Lihui Song. The amount is interest-free, unsecured and repayable on
demand.

| |                                      |  |   | June 30,    |  |   | December 31, | 
| | ------------------------------------ |  | - | ----------- |  | - | ------------ | 
| |                                      |  |   | 2010        |  |   | 2009         | 
| |                                      |  |   | (Unaudited) |  |   | (Audited)    | 
| | Total amount due to a
      director |  | $ | 105,143     |  | $ | 104,358      | 

|4. | Related Party Transactions
|-- | --------------------------

On May 6, 2008, Dollar Come entered
into a loan agreement with Ms. Tan to borrow $5,000,000 at the annual interest
rate of 8% for working capital. The loan was unsecured and due no later than May
5, 2010. Under a July 30, 2008 agreement, $3,260,000 of this loan was paid down
with payment made to Fuxin Zhonglin Industry Limited and W.T. Construction Inc.,
both wholly owned by Ms. Tan. An amount of $1,108,343 was offset by advances to
related party during 2009. An additional $146,500 of this loan was offset during
1st quarter of 2010. The balance of this debt at June 30, 2010 is
$485,157.

The Company accrued interest payable
related to amounts due to Ms. Tan totaling $19,406 and $25,268 for the six
months ended June 30, 2010 and 2009, respectively.

F-16

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|13. | Defined contribution plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | Pursuant to the relevant PRC regulations, the Company is
      required to make contributions at a rate of 24.4% of average salaries of
      latest fiscal year ended of Liaoning Province Fuxin City to a defined
      contribution retirement scheme organized by a state-sponsored social
      insurance plan in respect of the retirement benefits for the Companys
      employees in the PRC. The only obligation of the Company with respect to
      retirement scheme is to make the required contributions under the plan. No
      forfeited contribution is available to reduce the contribution payable in
      the future years. The defined contribution plan contributions were charged
      to the consolidated statement of operations. The Company contributed
      $15,485 and $17,982 for the six months ended June 30, 2010 and 2009,
      respectively.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|14. | Commitments and contingencies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | a.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

| |    |                                                                                                                                                                                                       
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b. | Operating lease
    arrangement                                                                                                                                                                       
| |    |                                                                                                                                                                                                       
| |    | As of June 30, 2010,
    the Company had one non-cancelable operating lease for its offices,
    factories and warehouses. The lease will expire in 2014 and the expected
    payments are as follows:

Within one year
      $
      439,500Two to five years
      
      1,289,192$
      1,728,692


The rental expense relating to the operating leases
was $ 220,950 and $218,798 for the six months ended June 30, 2010 and 2009
respectively.

| | c. | Environmental                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    | The Companys operations are subject to the laws and
      regulations in the PRC relating to the generation, storage, handling,
      transportation and discharge of certain materials, substances and waste
      into the environment, and various other health and safety matters.
      Governmental authorities have the power to enforce compliance with their
      regulations, and violators may be subject to fines, injunctions or both.
      The Company must devote substantial financial resources to ensure
      compliance, and the management believes that it is in substantial
      compliance with all the applicable laws and regulations.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    | The Company has not incurred any significant expenditure
      for environmental remediation, is currently not involved in any
      environmental remediation and has not accrued any amounts for
      environmental remediation relating to its operations. Under existing
      legislation, management believes that there are no probable liabilities
      that will have a material adverse effect on the financial position,
      operating results or cash flows of the Company.                                                                                                                                                                         

F-17

---

Golden Elephant Glass Technology, Inc. Notes to
Condensed Consolidated Financial Statements (Unaudited) (Stated in US
Dollars)

|15. | Segment information
|--- | -------------------

The nature of the Companys products,
production processes, type of customers and distribution methods are
substantially similar. The Company is considered as a single reportable segment
under FAS 131, Disclosures about Segments of an Enterprise and Related
Information.

All of the Companys long-lived assets
are located in the PRC during the reporting periods. Geographic information
about the revenues, which are classified based on the customers, is set out as
follows:-

| |        |   | Three months
      ended |  |   | Six months
      ended | 
| | ------ | - | ------------------------ |  | - | ---------------------- | 
| |        |   | June 30,                 |  |   | June 30,               | 
| |        |   | (Unaudited)              |  |   | (Unaudited)            | 
| |        |   | 2010                     |  |   | 2009                   | 
| | PRC    | $ | -                        |  | $ | -                      | 
| | Others |   | -                        |  |   | -                      | 
| | Total  | $ | -                        |  | $ | -                      | 

F-18

---

Item 2. Managements Discussion and Analysis of Financial
  Condition and Results of Operations.

Special Note Regarding Forward-Looking
  Statements

This Quarterly Report on Form 10-Q, including the following
  Managements Discussion and Analysis of Financial Condition and Results of
  Operations, contains forward-looking statements. Such statements include,
  among others, those concerning our expected financial performance and strategic
  and operational plans, as well as all assumptions, expectations, predictions,
  intentions or beliefs about future events. You are cautioned that any such
  forward-looking statements are not guarantees of future performance and that a
  number of risks and uncertainties could cause actual results of the Company to
  differ materially from those anticipated, expressed or implied in the
  forward-looking statements. The words believe, expect, anticipate,
  project, targets, optimistic, intend, aim, will or similar
  expressions are intended to identify forward-looking statements. All statements
  other than statements of historical fact are statements that could be deemed
  forward-looking statements. Risks and uncertainties that could cause actual
  results to differ materially from those anticipated include risks related to new
  and existing products; any projections of sales, earnings, revenue, margins or
  other financial items; any statements of the plans, strategies and objectives of
  management for future operations; any statements regarding future economic
  conditions or performance; uncertainties related to conducting business in
  China; any statements of belief or intention; any of the factors mentioned in
  the Risk Factors section of our Annual Report on Form 10-K filed on December
  22, 2010, and other risks mentioned in this Form 10-Q. The Company assumes no
  obligation and does not intend to update any forward-looking statements, except
  as required by law.

OVERVIEW

Our Company

We are a China-based float glass manufacturer. Our product
offerings include float glass, ultra-clear glass (also called crystal glass),
colored float glass and high grade, glass processed products such as mirrors,
glass artwork, tempered glass, insulated glass, laminated glass, lacquered glass
and similar products. Our products are manufactured in our production facility
in Fuxin City, Liaoning Province in China, and sold to end users in China, Asia,
Europe, South America and South Africa.

We design, develop, manufacture and market our products for use
  in a variety of end products, including automobiles, commercial and residential
  buildings, construction materials, furniture and display cases, lighting
  fixtures and decorative glass artwork, bath fixtures and electrical household
  appliances, such as refrigerators and microwave ovens. We sell our products to
  automakers and auto parts suppliers, building contractors and building material
  suppliers and manufacturers of retail goods, both directly and through a broad
  distributor network.

1

---

Our glass and glass products are manufactured in a broad range
  of colors and specifications which are usually measured by thickness and width
  and range between 2-23 millimeters in thickness and 3,300 millimeters in width.
  Our glass products are marketed primarily under the Golden Elephant brand
  name. Our total annual production capacity of our glass products is currently
  4.95 million weight cases and we maintain two production lines which have an
  aggregate daily melting capacity of over 800 tons, in which 300 tons production
  line was rent from Fuxin Guangya Flat Glass Co. Ltd. which has been bankrupted.

We strive to be a low cost provider of high quality products.
  Our glass products have been given a GB 11615-199 certification by the Chinese
  National Quality Standards for glass products and passed the annual inspections
  conducted by Chinese National Glass Inspection Committee since 2004. Our
  products also have been certified by ISO 9001-2000, a Chinese Quality System and
  ESC certification, a European Quality Certification for construction products,
  with the valid term from March 24, 2007 to March 24, 2010. We transport our
  products by train, sea and expressway.

Our Products

Our core product lines can be categorized as float glass
  products, consisting primarily of flat glass and specialty float glass products
  which are produced using the float glass methodology. The float methodology is
  currently used to manufacture virtually all of the flat glass in the world.

This manufacturing process produces a flat sheet of glass and
  consists of the following six essential steps:

|1. | Batch mixing. The raw materials (silica
      sand, soda ash and dolomite/limestone) are weighed and mixed and placed
      into a high temperature furnace where they are melted at 1500° C into
      molten glass.                                                                                  
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                        
|2. | Float bath. The molten glass mixture then
      is directed to a pool of liquid tin on which the molten glass floats
      while hardening. The glass, which is viscous, and the tin, which is fluid,
      does not mix and the contact surface between these two materials is
      perfectly flat.
|   |                                                                                                                                                                                                                                                                                                        
|3. | Coating. At this stage, specialized metal
      oxides coatings can be applied to the glass surface while the glass is
      still hot in the annealing lehr in order to improve its performance or
      enhance its appearance.                                                                      
|   |                                                                                                                                                                                                                                                                                                        
|4. | Annealing. Whether or not the molten glass
      is coated, the molten glass is slowly cooled or annealed as its passes
      into an annealing chamber called a lehr. Here it is cooled at controlled
      temperatures, until it is essentially at room temperature.                              
|   |                                                                                                                                                                                                                                                                                                        
|5. | Inspection. Next the glass is inspected to
      ensure that is meets specifications and quality requirements.                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                        
|6. | Cutting and Shipping. Finally, the float
      glass is then cut into large standard sheets or cut to size depending on
      its intended use and is ready to be shipped.                                                                                                                             

A description of the uses of our float glass and our products
  benefits are as follows:

- Heavy Float Glass. Our heavy float glass products, which are
      available in a variety of sizes, are manufactured based on our customers
      desired performance specifications with respect to thickness and tolerance,
      total weight, energy efficiency and light transmittance. Our products are
      designed to control energy usage, provide thermal insulation and a noise
      barrier as well as afford safety and security. Heavy float glass products are
      used in a wide variety of products including windows, doors, skylights,
      shelving, tabletops, and automotive applications.
- Ultra-Clear Glass and Colored Float Glass. Our Ultra-Clear
      float glass products are produced to have a higher percentage of light
      transmittance of up to 91.87% (as compared to 80-85% in our heavy float glass
      products) which results in glass product with enhanced clarity and greater
      translucence. This product line is designed to offer functional benefits in
      addition to aesthetic benefits, such as color, shaping, patterns and texture. Ultra-Clear Glass is used to produce
      high end products such as luxury chandeliers and artificial crystal crafts.

2

---

- Specialty Glass Processed Products. Using a variation on the
      standard float glass production methodology, we manufacture and sell specialty
      float glass products which include mirrors, tempered glass, insulated glass,
      laminated glass, lacquered glass, etc.

Manufacturing Facilities

Our primary manufacturing facility is located in Fuxin City in
  Liaoning Province, China. Our goal has been to construct manufacturing
  facilities which operate at peak efficiency while maintaining high workplace
  safety and environmental compliance standards.

We own one production line which became operative in August
  2003 and has daily melting capacity of 500 tons. We lease another production
  line from the liquidation committee of Fuxin Guangya Flat Glass Co. Ltd. with a
  term ending on the earlier of (i) ten years starting from August 25, 2004; or
  (ii) the closing date of the liquidation process for Fuxin Guangya Flat Glass
  Co. Ltd. We upgraded this production line and it went into operation in
  September 2005. The production line has a daily melting capacity of 300 tons and
  up to 1.65 million weight cases production capacity of ultra-clear and colored
  float glass annually. Our production lines are designed to operate continuously,
  365 days per year, throughout a 6 to 10 years initial operating life. Float
  lines are normally capable of several campaigns after the initial operating life
  following major repair and upgrade programs.

Full utilization of our production lines means operating on 3
  eight-hour shifts per day over a 7-day work week and overtime production may
  result in utilization rates exceeding 100%. Our average utilization rate during
  2007 and 2008 has been 100% and 94%, respectively.

Suspension of Production

During the recent global economic crisis, because many of our
customers operate in industry segments that have been hardest hit by the
economic crisis, such as the automotive, construction and home furnishing
industries, our performance was consequently suffered. From November 2008, we
suspended operations of our float glass manufacturing operations in order to
perform maintenance and system upgrades that eventually would be needed. We
opted to suspend operations and initiate the maintenance program at a time when
pricing and demand for our products was low in order to minimize the adverse
effect of suspending operations. Until the amelioration of the economic crisis,
particularly in the industry segments in which our targeted customers operate,
we expected to continue to experience significant challenges. In response to
these challenges, we will continue to implement what we believe to be prudent,
cost-saving measures in a judicious and timely fashion.

Recent Development

In April, 2011, we completed our maintenance program and
system upgrade, and since then we have been leasing our upgraded self-owned
manufacturing line to a third party in exchange for an annual rent of RMB 6
million.

3

---

Results of Operations

The following table sets forth key components of our results of
  operations for the periods indicated, in dollars.

|                                    |   | **Three months
      ended** |   |   | Six months ended |  
|----------------------------------- | - | ---------------------------- | - | - | ---------------- | -
|                                    |   | June 30,                     |   |   | June 30,         |  
|                                    |   | (Unaudited)                  |   |   | (Unaudited)      |  
|                                    |   | **2010**                     |   |   | **2009**         |  
|                                    |   |                              |   |   |                  |  
|Sales revenues                      | $ | -                            |   | $ | -                |  
|Cost of sales                       |   | -                            |   |   | -                |  
|Gross loss                          |   | -                            |   |   | -                |  
|Other operating income              |   |                              |   |   |                  |  
|Bad debts recovered                 |   | -                            |   |   | -                |  
|Decrease in provision for bad debts |   | -                            |   |   | -                |  
|Gain on disposal of a subsidiary    |   | -                            |   |   | -                |  
|Total other operating income        |   | -                            |   |   | -                |  
|Operating expenses                  |   |                              |   |   |                  |  
|Administrative expenses             |   | 817,623                      |   |   | 2,756,308        |  
|Selling expenses                    |   |                              |   |   |                  |  
|Total operating expenses            |   | 817,623                      |   |   | 2,756,308        |  
|Loss from operations                |   | (817,623                     | ) |   | (2,756,308       | )
|Interest income                     |   | -                            |   |   | 11,667           |  
|Other income                        |   | -                            |   |   | 349              |  
|Government grants                   |   | -                            |   |   | -                |  
|Finance costs                       |   | (492,227                     | ) |   | (851,635         | )
|Loss
      before income taxes      |   | (1,309,850                   | ) |   | (3,595,927       | )
|Income taxes                        |   | -                            |   |   | 19,701           |  
|Net income (loss)                   |   | (1,309,850                   | ) |   | (3,576,226       | )

Sales Revenue.Our sales revenue is generated
  from sales of our float glass products and ultra-white glass products from the
  inventory.

For the three months ended June 30, 2009 and the three months ended June 30,
2010, we did not generate any sales revenue, because we have suspended our
operations since November 2008 as a result of the global economic recession
commenced in 2008 and since then have commenced equipment maintenance and system
upgrades. The maintenance program is still in process.

During the six months ended June 30, 2010, we did not generate any sales
revenue, as compared to approximately $2.27 million revenue we generated during
the six months ended June 30, 2009. The decrease in sales revenue is due
suspension of operations since November 2008.

Cost of Sales.Our cost of sales primarily
  comprises of the costs of our raw materials, labor and overhead.

For the three months ended June 30, 2009 and the three months
  ended June 30, 2010, we did not generate any cost of sales due to the suspension
  of our operations from November 2008.

During the six months ended June 30, 2010, we did not
incurred any cost of sales, as compared to approximately $3.31 million cost of
sales that we incurred during the six months ended June 30, 2009. The decrease
in cost of sales is due suspension of operations since November 2008.

Administrative Expenses.Administrative
  expenses consist of costs associated with staff and support personnel who manage
  our business activities and professional fees paid to third parties.

For the three months ended June 30, 2009 and the three months
  ended June 30, 2010, our administrative expenses decreased from approximately
  $2.76 million to approximately $0.82 million, representing a decrease of
  approximately $1.94 million or approximately 170.29% . The substantial decrease
  of our administrative expenses was primarily attributable to the suspension of
  our operations since November 2008.

For the six months ended June 30, 2009 and the six months ended
  June 30, 2010, our administrative expenses decreased from approximately $3.12
  million to approximately $1.63 million, representing a decrease of approximately $1.49 million or approximately 47.76% . The
  substantial decrease of our administrative expenses was primarily attributable
  to the suspension of our operations since
November 2008.

4

---

Net loss.

For the three months ended June 30, 2009 and the three months
ended June 30, 2010, our net loss decreased by approximately $2.27 million, or
approximately 63.41%, to approximately $1.31 million during the three months
ended June 30, 2010 from approximately $3.58 million during the three months
ended June 30, 2009. The decrease in our net loss was a result of the decrease
of our administrative expenses due to the suspension of our operations since
November 2008.

For the six months ended June 30, 2009 and the six months
ended June 30, 2010, our net loss decreased by approximately $2.34 million, or
approximately 47.85%, to approximately $2.55 million during the six months ended
June 30, 2010 from approximately $4.89 million during the six months ended June
30, 2009. The decrease in our net loss was a result of the decrease of our
administrative expenses due to the suspension of our operations since November
2008.

Liquidity and Capital Resources

As of June 30, 2010, we had cash and cash equivalents of
  $7,192. We incurred a net loss of $2,550,103 for the six months ended June 30,
  2010 and had accumulated deficits of $14,111,872 as of June 30, 2010. In
  addition, we have been implementing a maintenance program for the float glass
  production lines since November 2008. During the maintenance period, all
  operations of the production lines and all manufacturing of the glass products
  are suspended. These matters raise substantial doubt about our ability to
  continue as a going concern.

With the improvement of economic environment and glass market,
  the management intends to implement its business plan of restoring the
  production lines and resuming its business operations, majorly relying on
  obtaining capitals from collecting trade receivables and other receivables.
  However, there is no assurance these activities will be successful.

The following table sets forth a summary of our cash flows for
  the periods indicated:

|                                                                         |  | Six months Ended |  
|------------------------------------------------------------------------ |  | ---------------- | -
|                                                                         |  | June 30,         |  
|                                                                         |  | 2010             |  
|Net cash provided by (used
      in) operating activities                |  | (94,544          | )
|Net cash (used in) provided by investing
      activities                |  | -                |  
|Net cash provided by
      financing activities                          |  | -                |  
|Effect of foreign currency translation on
      cash and cash equivalent |  | 94,388           |  
|Net decrease in cash and cash
      equivalent                           |  | (166             | )

Operating Activities:

Net cash used in operating activities was $94,544 for the six
  month period ended June 30, 2010, as compared to net cash provided by operating
  activities of 503,347 for the same period in 2009, representing a decrease of
  $597,891, which was due to the suspension of our operations since November
  2008.

Investing Activities:

Our main uses of cash for investing activities are payments to
  the acquisition of property, plant and equipment and construction in progress.
  Net cash provided by/(used in) investing activities in the six months ended June
  30, 2010 was zero, as compared to $631,005 of net cash used in investing
  activities for the six months ended June 30, 2009. The significant decrease of
  net cash used in investing activities was due to the suspension of our
  operations since November 2008.

5

---

As of June 30, 2010, the amount, maturity date and term of each
  of our bank loans are as follows:

(All amounts, other than percentages, in millions of U.S.
  dollars)

|Banks                                                           |   | Amounts |  |  | Maturity Date     |  |  | Duration | 
|--------------------------------------------------------------- | - | ------- |  |  | ----------------- |  |  | -------- | 
|China CITIC Bank, 
      Shenyang Branch                        |   | 2.63    |  |  | November 26, 2008 |  |  | 1 year   | 
|China Construction Bank, 
      Fuxin Branch                    |   | 2.93    |  |  | March 24, 2009    |  |  | 1 year   | 
|Shanghai Pudong 
      Development Bank, 
      Shenyang Branch |   | 4.32    |  |  | May 28, 2009      |  |  | 1 year   | 
|China Construction Bank, 
      Fuxin Branch                    |   | 0.88    |  |  | April 29, 2009    |  |  | 6 months | 
|China Construction Bank, 
      Fuxin Branch                    |   | 2.04    |  |  | May 22, 2009      |  |  | 6 months | 
|TOTAL                                                           | $ | 12.80   |  |  |                   |  |  |          | 

On May 6, 2008, the Companys subsidiary Dollar Come entered
into a loan agreement with Ms. Lin Tan, our Chief Executive Officer, President,
and Chairman, to borrow $5 million at the annual interest rate of 8%. The
agreement has a two-year term and the loan proceed was to be used as working
capital. The loan was unsecured and is due May 5, 2010. On July 30, 2008,
$3,260,000 of this loan was paid with payment made to Fuxin Zhonglin Industry
Limited and W.T. Construction Inc., both wholly owned by Ms. Tan. An amount of
$1,108,343 was offset by advances to Ms. Tan during 2009. An additional $146,500
of this loan was offset by advances to Ms. Tan during the first quarter of 2010.
As of June 30, 2010, we owed Ms. Tan $485,157 for the principal amount in
default.

As of June 30, 2010, we have not repaid any of our past due
bank loans because of capital shortage in the first and second quarter of 2010. In the current tight credit market, we cannot
  give assurance that we can refinance these loans on favorable terms to us, if at
  all. Our current available working capital may not be adequate to sustain our
  operations at our current levels through at least the next twelve months. There
  is substantial doubt about our ability to continue as a going concern. The fact
  that we have received this going concern opinion from our independent auditors
  may make it more difficult for us to raise capital on favorable terms. Any
  failure by us to raise additional funds on terms favorable to us, or at all,
  could limit our ability to expand our business operations and could harm our
  overall business prospects.

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 or capital expenditures or capital resources that is
  material to an investor in our securities.

Obligations under Material Contract

Below is a summary of our current obligations under material
  contracts.

In connection with the entry into the Securities Purchase
  Agreement, on July 24, 2008, the Company entered into a make good escrow
  agreement (the " Make Good Escrow Agreement ") with Win-Win Global Investments,
  Inc. (the "Pledgor "), the investors listed in the Securities Purchase
  Agreement, Roth Capital Partners, LLC (" Roth ") and STC, pursuant to which the
  Pledgor agreed to certain "make good" provisions in the event that the Company
  does not meet certain income thresholds for fiscal years 2008 and/or 2009
  discussed in the Securities Purchase Agreement. Pursuant to the Make Good Escrow
  Agreement, the Pledgor established an escrow account and delivered to STC
  certificates evidencing 1,669,398 shares of the Companys common stock held by
  the Pledgor (the " Make Good Shares ") along with blank stock powers, to be held
  for the benefit of the investors. The Pledgor agreed that if the after tax net
  income (the " ATNI ") for the Companys 2008 fiscal year is less than
  $10,000,000 or the ATNI for the Companys 2009 fiscal year is less than
  $14,000,000 (after the exclusion of certain items from the calculation), then,
  in each case, the Pledgor will transfer to the investors, on a pro rata basis,
  50% of the Make Good Shares within 10 business days after the Companys annual
  report on Form 10-K is filed for the respective fiscal year. In such event, the
  Pledgors obligation to transfer the Make Good Shares continues to apply to each
  of the investors, even if an investor has transferred or sold all or any portion
  of its securities, and each of the investors shall have the right to assign its rights to receive a pro rata
  portion of the Make Good Shares in conjunction with negotiated sales or
  transfers of any of its securities. If the ATNI for the Companys 2008 fiscal
  year is no less than $10,000,000 (after the exclusion of certain items from the
  calculation), 50% of the Make Good Shares will be released to the Pledgor. If
  the ATNI for the Companys 2009 fiscal year is no less than $14,000,000 (after
  the exclusion of certain items from the calculation), then the remaining 50% of
  the Make Good Shares will be released to the Pledgor. The parties also agreed
  that for purposes of determining the ATNI under the Securities Purchase
  Agreement, the release of the Make Good Shares to the Investors or the Pledgor
  as a result of the operation of the Make Good Agreement shall not be deemed to
  be an expense, charge, or other deduction from revenues even though GAAP may
  require contrary treatment. The Make Good Escrow Agreement will terminate upon
  the distribution of all the Make Good Shares. As we did not meet the ATNI for
  2008 and 2009, each 50% of the Make Good Shares representing 100% of the Make
Good Shares have been released to the investors on a pro rata basis.

6

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Seasonality

Our Companys business is seasonal, with the highest proportion
  of sales and operating income being generated in the second and third quarters
  of each year, with lesser sales and operating income being generated in the
  first and fourth quarters of each year. Our working capital requirements
  fluctuate during the period, increasing substantially during the first and
  fourth quarters as a result of lower demand for glass products due to the
  curtailments of construction works in winter season.

Critical Accounting Policies

Revenue recognition

Revenue from sales of the Companys products is recognized when
  the significant risks and rewards of ownership have been transferred to the
  buyer, the sales price is fixed or determinable and collection is reasonably
  assured.

Use of estimates

In preparing financial statements in conformity with accounting
  principles generally accepted in the United States of America, management makes
  estimates and assumptions that affect the reported amounts of assets and
  liabilities and disclosures of contingent assets and liabilities at the dates of
  the financial statements, as well as the reported amounts of revenues and
  expenses during the reporting periods. These accounts and estimates include, but
  are not limited to, the valuation of accounts receivable, inventories, deferred
  income taxes, provision for warranty and the estimation on useful lives of
  property, plant and equipment. Actual results could differ from those estimates.
  Critical accounting estimates used in preparation of the financial statements
  include managements judgments about its valuation of the allowance for bad
  debt.

Concentrations of credit risk

Financial instruments that potentially subject the Company to
  significant concentrations of credit risk consist principally of cash and cash
  equivalents, trade receivables and other receivables. As of June 30, 2010 and
  December 31, 2009, substantially all of the Companys cash and cash equivalents
  and restricted cash were held by major financial institutions located in the
  PRC, which management believes are of high credit quality. With respect to other
  receivables and trade receivables, the Company extends credit based on an
  evaluation of the customers financial condition. The Company generally does not
  require collateral for trade receivables and other receivables and maintains an
  allowance for doubtful accounts of trade receivables and other receivables. The
  Company conducts periodic reviews of its customers' financial condition
  and customer payment practices to minimize collection risk on accounts
  receivable.

7

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Details of customers for 10% or more of the Companys trade
  receivables are:

As of
        June 30,2010(Unaudited)Company A
      $
      1,649,929Company B
      
      610,313Company C
      
      559,878Company D
      
      479,610Totals
      $
      3,299,730


Allowance for doubtful accounts

The Company establishes an allowance for doubtful accounts
  based on managements assessment of the collectability of trade receivables and
  other receivables. A considerable amount of judgment is required in assessing
  the amount of the allowance; the Company considers the historical level of
  credit losses and applies percentages to aged receivable categories. The Company
  makes judgment about the creditworthiness of each customer based on ongoing
  credit evaluations, and monitors current economic trends that might impact the
  level of credit losses in the future. If the financial condition of the
  customers were to deteriorate, resulting in their inability to make payments, a
  larger allowance may be required.

Based on the above assessment, during the reporting years,
  management establishes a general provisioning policy to make the allowance
  equivalent to 10% of gross amount of trade receivables and other receivables due
  over 6-12 months, 25% gross amount of trade receivables and other receivables
  due over 1-2 years and 50% of gross amount of trade receivables and other
  receivables due over 2-3 years and 100% of gross amount of trade receivables and
  other receivables due over 3 years. Additional specific provision is made
  against trade receivables aged less than 6 months to the extent which they are
  considered to be doubtful.

Bad debts are written off when identified. The Company extends
  unsecured credit to customers ranging from three to six months in the normal
  course of business. The Company does not accrue interest on trade
  receivables.

Historically, losses from uncollectible accounts have not
  significantly deviated from the general allowance estimated by management and no
  significant additional bad debts have been written off directly to the profit
  and loss. This general provisioning policy has not changed in the past since
  establishment and management considers that the aforementioned general
  provisioning policy is adequate and not too excessive and does not expect to
  change this established policy in the near future.

Recently issued accounting pronouncements

Adoption of FASB Accounting Standards Codification

In June 2009, the FASB issued SFAS No. 168, " The FASB
  Accounting Standards Codification and the Hierarchy of Generally Accepted
  Accounting Principlesa replacement of FASB Statement No. 162 ". This standard
  is now included in ASC Topic 105 and established only two levels of GAAP,
  authoritative and non-authoritative. The FASB Accounting Standards Codification
  (the "Codification") became the source of authoritative, nongovernmental GAAP,
  except for rules and interpretive releases of the SEC, which are sources of
  authoritative GAAP for SEC registrants. All other non-grandfathered, non-SEC
  accounting literature not included in the Codification became non-authoritative.
  This standard is effective for financial statements for interim or annual
  reporting periods ending after September 15, 2009. Effective August 1, 2009, we
  adopted the new guidelines and
  numbering system prescribed by the Codification when referring to GAAP. The adoption had no impact on our consolidated financial condition, results of operations or cash flows.

8

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Adoption of FASB ASC 805

Effective January 1, 2009, the Company adopted FASB ASC 805, “Business Combinations.” FASB ASC 805 changed accounting for acquisitions that close beginning in 2009. FASB ASC 805 extends its applicability to all transactions and other
  events in which one entity obtains control over one or more other businesses. It broadens the fair value measurement and recognition of assets acquired, liabilities assumed, and interests transferred as a result of business combinations. FASB ASC
  805 expands on required disclosures to improve the statement users’ abilities to evaluate the nature and financial effects of business combinations. The adoption of FASB ASC 805 did not have a material impact on the Company’s financial
  statements.

Adoption of FASB ASC 805-20

Effective January 1, 2009, the Company adopted FASB ASC 805-20, “Non controlling Interests in Consolidated Financial Statements.” FASB ASC 805-20 requires that a non controlling interest in a subsidiary be reported as equity and the
  amount of consolidated net income specifically attributable to the non controlling interest be identified in the consolidated financial statements. It also calls for consistency in the manner of reporting changes in the parent’s ownership
  interest and requires fair value measurement of any non controlling equity investment retained in a deconsolidation. FASB ASC 805-20 requires retroactive adoption of the presentation and disclosure requirements for existing minority interests. The
  adoption FASB ASC 805-20 did not have material impact on the Company’s financial statements.

Adoption of FASB ASC 815

Effective January 1, 2009, the Company adopted FASB ASC 815, “Disclosures about Derivative Instruments and Hedging Activities.” FASB ASC 815 requires enhanced disclosures about (i) how and why the Company uses derivative instruments,
  (ii) how the Company accounts for derivative instruments and related hedged items, and (iii) how derivative instruments and related hedged items affect the Company’s financial results. The adoption FASB ASC 815 did not have any impact on the
  Company’s financial statements.

Adoption of FASB ASC 350-30

Effective January 1, 2009, the Company adopted FASB ASC 350-30, “Determination of the Useful Life of Intangible Assets.” FASB ASC 350-30 amended the factors that should be considered in developing renewal or extension assumptions used to
  determine the useful life of a recognized intangible asset. The adoption of FASB ASC 350-30 did not have material impact on the Company’s financial statements.

Adoption of FASB ASC 860

In June 2009, the FASB issued ASC 860, which eliminates the concept of a qualifying special-purpose entity, creates more stringent conditions for reporting a transfer of a portion of a financial asset as a sale, clarifies other sale-accounting
  criteria, and changes the initial measurement of a transferor’s interest in transferred financial assets. FASB ASC 860 will be effective for transfers of financial assets in years beginning after November 15, 2009 and in interim periods within
  those years with earlier adoption prohibited. The adoption of ASC 860 is not expected to have a material impact on our consolidated financial position or results of operations.

Adoption of FASB ASU 2009-05

In August 2009, the FASB issued Accounting Standards Update ("ASU") No. 2009-05, "Measuring Liabilities at Fair Value," which amends the guidance in ASC 820, Fair Value Measurements and Disclosures, to provide guidance on fair value measurement of
  liabilities. If a quoted price in an active market is not available for an identical liability, ASU 2009-05 requires companies to compute fair value by using quoted prices for an identical
  liability when traded as an asset, quoted prices for similar liabilities when traded as an asset or another valuation technique that is consistent with the guidance in ASC 820. ASU 2009-05 will be effective for interim and annual periods beginning
  after its issuance and did not have a material impact on our consolidated financial position or results of operations.

9

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Adoption of FASB ASU 2009-13

In October 2009, the FASB issued ASU No. 2009-13, “Multiple-Deliverable Revenue Arrangements” (ASU 2009-13). This update removes the criterion that entities must use objective and reliable evidence of fair value in separately accounting
  for deliverables and provides entities with a hierarchy of evidence that must be considered when allocating arrangement consideration. The new guidance also requires entities to allocate arrangement consideration to the separate units of accounting
  based on the deliverables’ relative selling price. The provisions will be effective for revenue arrangements entered into or materially modified in our year 2011 and must be applied prospectively. We are currently evaluating the impact of the
  provisions of ASU 2009-13.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Not applicable.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) that are designed to ensure that information that would be required to be disclosed in Exchange Act reports is recorded, processed, summarized and
  reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including to our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow
  timely decisions regarding required disclosure.

As required by Rule 13a-15 under the Exchange Act, our management, including our Chief Executive Officer, Ms. Lin Tan, and Chief Financial Officer, Ms. Hong Tan, evaluated the effectiveness of the design and operation of our disclosure controls and
  procedures as of June 30, 2010. Based on our assessment, Ms. Lin Tan and Ms. Hong Tan determined that, as of June 30, 2010, and as of the date that the evaluation of the effectiveness of our disclosure controls and procedures was completed, our
  disclosure controls and procedures were not effective to satisfy the objectives for which they are intended. Our conclusion is based primarily on the occurrence of a significant number of out-of-period adjustments, which we believe primarily stems
  from the fact that we had limited accounting and financial staff with the requisite qualifications. We are in the process of considering changes in our internal control over financial reporting in order to address the aforementioned deficiencies.

10

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Internal Controls Over Financial Reporting

There have been no changes in our internal controls over
  financial reporting during six months ended June 30, 2010, that have
  materially affected, or are reasonably likely to materially affect, our internal
  controls over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

There is no legal proceeding pending against us.

Item 1A. Risk Factors

Not Applicable.

Item 2. Unregistered Sales of Equity Securities and Use of
  Proceeds

None.

Item 3. Defaults Upon Senior Securities

As of June 10, 2011, the default amount, maturity date, term
and total arrearage of each of our past due bank loans are as follows:

(All amounts, other than percentages, in
millions of U.S. dollars)

|                                                        |   |                           |  |  |                     |  |  |          |  |   | Total              | 
|------------------------------------------------------- | - | ------------------------- |  |  | ------------------- |  |  | -------- |  | - | ------------------ | 
|                                                        |   |                           |  |  |                     |  |  |          |  |   | Arrearage          | 
|                                                        |   |                           |  |  |                     |  |  |          |  |   | (Principal
      & | 
|Banks                                                   |   | Principal
      Amounts 1 |  |  | Maturity
      Date |  |  | Duration |  |   | Interest)          | 
|                                                        |   |                           |  |  |                     |  |  |          |  |   |                    | 
|China CITIC
      Bank, Shenyang Branch                 |   | 2.75                      |  |  | November 26, 2008   |  |  | 1 year   |  |   | 3.61               | 
|                                                        |   |                           |  |  |                     |  |  |          |  |   |                    | 
|China
      Construction Bank, Fuxin Branch             |   | 3.07                      |  |  | March 24, 2009      |  |  | 1 year   |  |   | 4.16               | 
|                                                        |   |                           |  |  |                     |  |  |          |  |   |                    | 
|Shanghai Pudong
      Development Bank, Shenyang Branch |   | 4.53                      |  |  | May 28, 2009        |  |  | 1 year   |  |   | 6.30               | 
|                                                        |   |                           |  |  |                     |  |  |          |  |   |                    | 
|China
      Construction Bank, Fuxin Branch             |   | 0.92                      |  |  | April 29, 2009      |  |  | 6 months |  |   | 1.21               | 
|                                                        |   |                           |  |  |                     |  |  |          |  |   |                    | 
|China
      Construction Bank, Fuxin Branch             |   | 2.14                      |  |  | May 22, 2009        |  |  | 6 months |  |   | 2.73               | 
|                                                        |   |                           |  |  |                     |  |  |          |  |   |                    | 
|TOTAL                                                   | $ | 13.41                     |  |  | -                   |  |  |          |  | $ | 18.01              | 

1The increase of the principal amount since June
30, 201 reflects a change of RMB to USD exchange rate.

On May 6, 2008, the Companys subsidiary Dollar Come entered
into a loan agreement with Ms. Lin Tan to borrow US$5 million at the annual
interest rate of 8%. The agreement has a two-year term and the loan proceeds
were used for working capital. The loan was unsecured and due no later than May
5, 2010. Under a July 30, 2008 agreement, $3,260,000 of this loan was paid with
payment made to Fuxin Zhonglin Industry Limited and W.T. Construction Inc., both
wholly owned by Ms. Tan. An amount of $1,108,343 was offset by advances to
related party during 2009. An additional $146,500 of this loan was offset during
the first quarter of 2010. As of June 10, 2011, we owe Mr. Tan US $485,157 the
principal amount in default and US $105,518 for interest incurred thereof.

As of June 10, 2011, we are in default of bank loans in total
principal amount of US$13.41 million. Consequently, we have incurred arrearage in a total amount of

US$18.01million as of June 10, 2011.

Item 4. (Removed & Reserved).

None.

Item 5. Other Information

The following sets forth information required to be disclosed
in a report on Form 8-K under Item 1.1 Entry into a Material Definitive
Agreement, during the period covered by this Form 10-Q, but not reported.

Settlement and Release Agreement

June 9, 2010, Fuxin Xianheng entered into a settlement and
release agreement (the "Settlement and Release Agreement") with a bankruptcy
receiver (the "Bankruptcy Receiver") of Fuxin Guangya Flat Glass Co., Ltd. ("Guangya"),pursuant to which Fuxin Xianheng and the Bankruptcy Receiver settled the
Bankruptcy Receivers liabilities of termination of a lease between the two
parties in 2007 (the "2007 Lease").

As part of the restructuring of Guangyas bankruptcy, on
September 15, 2007, Fuxin Xianheng and the Bankruptcy Receiver entered into the
2007 Lease, pursuant to which Fuxin Xianheng leased certain manufacturing
equipments (the "Leased Equipments") from the Bankruptcy Receiver. The 2007
Lease was formulated in the circumstances where the Bankruptcy Receiver was appointed to assume
jurisdiction of the assets of Guangya when Guangya filed for bankruptcy and
after the Bankruptcy Receiver terminated an earlier manufacturing equipment
lease entered into by Guangya and Fuxin Hengrui in 2004.

In April 2010, the Bankruptcy Receiver terminated the 2007
Lease with Fuxin Xianheng and decided to conduct sales of the Leased Equipments,
to satisfy certain third party debts secured by the Leased Equipment as
collateral. As a consequence of the termination, pursuant to the 2007 Lease,
Fuxin Hengrui is entitled to damages in amount of RMB 50,559,895 (the
"Damages").

In light of the foregoing, on June 9, 2010, Fuxin Hengrui
entered into the Settlement and Release Agreement with the Bankruptcy Receiver,pursuant to which the Bankruptcy Receiver agreed topay the following
scaled amount (the "Settlement Payment") to Fuxin Hengrui, in exchange, Fuxin
Hengrui agreed to release any obligations or liabilities incurred to the
Bankruptcy Receiver under the 2007 Leases. Pursuant to the Settlement and
Release Agreement, the Settlement Payment should be paid, when the proceeds of
the sales of equipments becomes available and after such proceed being applied
to satisfy security interest with higher priority, in following amount:

- 

if the proceeds of the sales of Leased
  Equipments is RMB RMB62,700,000or higher, Fuxin Xianheng will be entitled to
  RMB26,390,000;

A copy of a summary of the Settlement and Release Agreement
is included as Exhibit 10.1 herewith.

Item 6. Exhibits

Copies of the following documents are included as exhibits to
  this report pursuant to Item 601 of Regulation S-K.

|Exhibit SEC Ref. | Title of Document                                                                                                                                                
|---------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
|No.              |                                                                                                                                                                  
|                 |                                                                                                                                                                  
|10.1             | Summary of Settlement
    and Release Agreement dated June 9, 2010.                                                                                              
|                 |                                                                                                                                                                  
|31.1             | Certification of the Principal Executive Officer pursuant to
      Section 302 of the Sarbanes-Oxley Act of 2002                                                 
|                 |                                                                                                                                                                  
|31.2             | Certification of the Principal Financial Officer pursuant to
      Section 302 of the Sarbanes-Oxley Act of 2002                                                 
|                 |                                                                                                                                                                  
|32.1             | Certification of the Principal Executive Officer pursuant to
      U.S.C. Section 1350 as adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002
|                 |                                                                                                                                                                  
|32.2             | Certification of the Principal
    Financial Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002  

11

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act, the registrant
has duly caused this
  report to be signed on its behalf by the undersigned thereunto duly authorized.

|                    | GOLDEN ELEPHANT GLASS                       
|------------------- | --------------------------------------------
|                    | TECHNOLOGY, INC.                            
|                    |                                             
|Date: June 10, 2011 |                                             
|                    |                                             
|                    | /s/Lin Tan                                  
|                    | Lin Tan                                     
|                    | Chief Executive Officer and President       
|                    | (Principal                                  
|                    | Executive Officer)                          
|                    |                                             
|Date: June 10, 2011 |                                             
|                    |                                             
|                    | /s/Hong Tan                                 
|                    | Hong Tan                                    
|                    | Chief Financial Officer (Principal Financial
|                    | and Chief Accounting Officer)               
|                    |                                             

12

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