|  ̈ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIESEXCHANGE ACT OF 1934 |
|--------|-----------------------------------------------------------------------------------------------|

| x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|--------------------------------------------------------------------------------------|

|  ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--------|------------------------------------------------------------------------------------------|

|  ̈ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--------|---------------------------------------------------------------------------------------------|

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|  ̈   Large Accelerated filer |  ̈   Accelerated filer | x   Non-accelerated filer |
|---------------------------------------|---------------------------------|--------------------------------|

|   x   US GAAP |  ̈   International Financial ReportingStandards as issued by the InternationalAccounting Standards Board |    ̈   Other |
|-------------------------|-------------------------------------------------------------------------------------------------------------------|----------------------------|

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|     |   |                                                      |   |   Page |
|----------|--------|-----------------------------------------------------------|--------|-------------|
|     |   | PART I                                                    |   |        |
| Item 1.  |   | Identity of Directors, Senior Management and Advisers     |   | 5           |
|     |   |                                                      |   |        |
| Item 2.  |   | Offer Statistics and Expected Timetable                   |   | 5           |
|     |   |                                                      |   |        |
| Item 3.  |   | Key Information                                           |   | 5           |
|     |   |                                                      |   |        |
| Item 4.  |   | Information On The Company                                |   | 23          |
|     |   |                                                      |   |        |
| Item 4A. |   | Unresolved Staff Comments                                 |   | 45          |
|     |   |                                                      |   |        |
| Item 5.  |   | Operating and Financial Review and Prospects              |   | 45          |
|     |   |                                                      |   |        |
| Item 6.  |   | Directors, Senior Management and Employees                |   | 73          |
|     |   |                                                      |   |        |
| Item 7.  |   | Major Shareholders and Related Transactions               |   | 78          |
|     |   |                                                      |   |        |
| Item 8.  |   | Financial Information                                     |   | 80          |
|     |   |                                                      |   |        |
| Item 9.  |   | The Offer and Listing                                     |   | 80          |
|     |   |                                                      |   |        |
| Item 10. |   | Additional Information                                    |   | 80          |
|     |   |                                                      |   |        |
| Item 11. |   | Quantitative and Qualitative Disclosure About Market Risk |   | 98          |
|     |   |                                                      |   |        |
| Item 12. |   | Description of Securities Other Than Equity Securities    |   | 99          |

|                      |   | PART II                                                                           |   |   |
|---------------------------|--------|-----------------------------------------------------------------------------------|--------|--------|
| Item 13.   |   | Defaults, Dividend Arrearages And Delinquencies                                   |   | 100    |
|                      |   |                                                                              |   |   |
| Item 14.   |   | Material Modifications To The Rights Of Security Holders And Use Of Proceeds |   | 100    |
|                      |   |                                                                              |   |   |
| Item 15.                  |   | Controls and Procedures                                                           |   | 100    |
|                      |   |                                                                              |   |   |
| Item 16A.                 |   | Audit Committee Financial Expert                                                  |   | 101    |
|                      |   |                                                                              |   |   |
| Item 16B.                 |   | Code of Ethics                                                                    |   | 101    |
|                      |   |                                                                              |   |   |
| Item 16C.                 |   | Principal Accountant Fees and Services                                            |   | 101    |
|                      |   |                                                                              |   |   |
| Item 16D.                 |   | Exemptions from the Listing Standards for Audit Committees                        |   | 102    |
|                      |   |                                                                              |   |   |
| Item 16E.                 |   | Purchases of Equity Securities by the Issuer and Affiliated Purchasers            |   | 102    |
|                      |   |                                                                              |   |   |
| Item 16F.                 |   | Change in Registrant’s Certifying Accountant                                |   | 102    |
|                      |   |                                                                              |   |   |
| Item 16G.                 |   | Corporate Governance                                                              |   | 102    |
|                      |   | PART III                                                                          |   |   |
| Item 17.                  |   | Financial Statements                                                              |   | 103    |
|                      |   |                                                                              |   |   |
| Item 18.                  |   | Financial Statements                                                              |   | 103    |
|                      |   |                                                                              |   |   |
| Item 19.                  |   | Exhibits                                                                          |   | 104    |
|                      |   |                                                                              |   |   |
| Signatures                |   |                                                                              |   | 107    |

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| Ÿ   | To restate our consolidated financial statements for the year ended December 31, 2010 with respect to the accounting for our preferred shares and certain related features of our 2010 Private Placement. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Ÿ   | To include exchange rate information. |
|--------------------|---------------------------------------|

| Ÿ   | To move disclosures relating to our directors and senior management from Item 1 to Item 6. |
|--------------------|--------------------------------------------------------------------------------------------|

| Ÿ   | To include a risk factor regarding contractual obligations that may create potential conflicts of interest for our controlling shareholder. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------|

| Ÿ   | To revise disclosures regarding PRC regulatory matters. |
|--------------------|---------------------------------------------------------|

| Ÿ   | To include disclosure regarding our audit, compensation, and nomination committees. |
|--------------------|------------------------------------------------------------------------------------------|

| Ÿ   | To replace the description of our Memorandum and Articles of Association. |
|--------------------|---------------------------------------------------------------------------|

| Ÿ   | To include disclosures required by Items 15 and 16.A-16.G relating to various audit and corporate governance items. |
|--------------------|---------------------------------------------------------------------------------------------------------------------|

| Ÿ   | To include certifications pursuant to the Sarbanes-Oxley Act of 2002. |
|--------------------|-----------------------------------------------------------------------|

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|   | · | All share and per share data have been presented to give retrospective effect to our reorganization as described in the section entitled “Our Corporate Structure.” |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | “We,” “us,” “our company,” “our” and “China Dredging” refer to China Dredging Group Co., Ltd., a BVI company, and its subsidiaries and variable interest entities. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | “China Dredging HK” refers to China Dredging (HK) Company Limited, a company organized under the laws of Hong Kong, a wholly owned subsidiary of China Dredging. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | “Fujian Service” refers to Fujian Xing Gang Port Service Co., Ltd., our operating business in the PRC. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------|

|   | · | “Fujian WangGang” refers to Fujian WangGang Dredging Construction Co., Ltd., a PRC company, a wholly owned subsidiary of China Dredging HK and a wholly foreign-owned enterprise under PRC law.  Fujian WangGang holds 50% of the equity interest in Fujian Service. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | “Wonder Dredging” refers to Wonder Dredging Engineering LLC, a PRC company, which holds a 50% equity interest in Fujian Service.  The shareholders of Wonder Dredging have transferred 100% of the economic benefit of Fujian Service and full voting and management control to Fujian WangGang. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | “CAC” refers to Chardan Acquisition Corp., a BVI company. |
|--------|--------|-----------------------------------------------------------------------|

|   | · | The “Merger” refers to the merger of CAC with and into China Dredging, which was consummated on October 27, 2010. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------|

|   | · | “2010 Private Placement” refers to our private placement, between October 2010 to December 21, 2010, in multiple closings, of an aggregate of 10,012,987 preferred shares, at a purchase price of $5.00 per share with gross proceeds of approximately $50.1 million. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | “Shares” or “ordinary shares” refers to our ordinary shares, no par value per share, and “preferred shares” refers to our Class A preferred shares, no par value per share. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | “BVI” refers to the British Virgin Islands. |
|--------|--------|---------------------------------------------------------|

|   | · | “China” or the “PRC” refers to the People’s Republic of China, excluding Hong Kong, Macau and Taiwan. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | · | The “U.S.” and the “United States” refers to the United States of America. |
|--------|--------|----------------------------------------------------------------------------------------------------|

|   | · | “RMB” or “Renminbi” refers to the legal currency of China and “$,” “dollar,” “US$” or “U.S. dollar” refers to the legal currency of the United States. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                   |   | For the Period  |                     |     |                                                      |   |
|--------------------------------------------------------|--------|---------------------------|--------------------------|----------|-----------------------------------------------------------|--------|
|                                                   |   | from January 8, |                     |     |                                                      |   |
|                                              |   | 2008 (Inception)     |                     |     |                                                      |   |
|                                                   |   | to December 31, |                     |     | For the Years Ended December 31, |   |
| Statement of Operations Data                 |   | 2008                      |                     |     | 2009                                                      |   |   | 2010 |   |
|                                                   |   | (Audited)                 |                     |     | (Audited)                                                 |   |   | (Restated) |   |
|                                                   |   |            |                     |     |                                                 |   |   |   |   |
| Contract revenue                                       |   | $                         | 54,480,271               |     |                                                      | $      | 80,333,891 |   |   | $ | 131,405,665 |   |
| Cost of contract revenue                               |   |                      |   (25,424,227       | )   |                                                      |   | (38,715,490 | )   |   |   | (58,723,528 | ) |
| Gross profit                                           |   |                      |   29,056,044   |     |                                                      |   | 41,618,401   |   |   |   | 72,682,137 |   |
| General and administrative expenses                    |   |                      |   (2,152,575        | )   |                                                      |   | (2,531,132 | )   |   |   | (7,159,793 | ) |
| Income from operations                                 |   |                      |   26,903,469   |     |                                                      |   | 39,087,269   |   |   |   | 65,522,344 |   |
| Other (expense) income                                 |   |                      |   (136,332          | )   |                                                      |   | (726,020 | )   |   |   | (731,668 | ) |
| Income before income taxes                             |   |                      |   26,767,137   |     |                                                      |   | 38,361,249   |   |   |   | 64,790,676 |   |
| Income tax expense                                     |   |                      |   (6,696,745        | )   |                                                      |   | (9,596,651 | )   |   |   | (16,556,396 | ) |
| Net income                                             |   | $                         | 20,070,392               |     |                                                      | $      | 28,764,598 |   |   | $ | 48,234,280 |   |
| Accretion of discount on Class A Preferred Shares      |   |                      |   -                 |     |                                                      |   | - |   |   |   | (22,293,720 | ) |
| Net income attributable to ordinary shareholders       |   | $                         | 20,070,392               |     |                                                      | $      | 28,764,598 |   |   | $ | 25,940,560 |   |
|                                                   |   |                      |                     |     |                                                      |   |   |   |   |   |   |   |
| Earnings per share                                     |   |                      |                     |     |                                                      |   |   |   |   |   |   |   |
| Earnings per ordinary share                            |   |                      |                     |     |                                                      |   |   |   |   |   |   |   |
| – Basic                                     |   | $                         | 0.38                     | (1)      |                                                      |   | 0.55 | (1) |   |   | 0.50 |   |
| – Diluted                                   |   | $                         | 0.38                     | (1)      |                                                      |   | 0.55 | (1) |   |   | 0.50 |   |
| Weighted average number of ordinary shares outstanding |   |                      |                     |     |                                                      |   |   |   |   |   |   |   |
| – Basic                                     |   |                      |   52,177,323   |     |                                                      |   | 52,177,323   |   |   |   | 52,264,994 |   |
| – Diluted                                   |   |                      |   52,177,323   |     |                                                      |   | 52,177,323   |   |   |   | 52,264,994 |   |

|   | (1) | The earnings per share for 2008 and 2009 were calculated as if the existing corporate structure had been in existence throughout the periods presented and as if the reorganization had occurred as of the beginning of the earliest period presented. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                     |   | December 31, |       |
|------------------------------------------|--------|--------------|------------|
| Balance Sheet Data                       |   | 2008         |       |   | 2009 |   |   | 2010 |   |
|                                |   | (Audited)    |       |   | (Audited) |   |   | (Restated) |   |
| Assets                                   |   |         |       |   |   |   |   |   |   |
| Total current assets                     |   | $            | 1,362,142  |   |   | $ | 25,984,418 |   |   | $ | 102,411,948 |   |
| Total other assets                       |   |         | 56,925,865 |   |   |   | 54,130,835 |   |   |   | 76,823,403 |   |
| Total assets                             |   | $            | 58,288,007 |   |   | $ | 80,115,253 |   |   | $ | 179,235,351 |   |
| Liabilities and equity                   |   |         |       |   |   |   |   |   |   |   |   |   |
| Liabilities                              |   |         |       |   |   |   |   |   |   |   |   |   |
| Total current liabilities                |   | $            | 22,068,848 |   |   | $ | 9,282,633 |   |   | $ | 11,910,076 |   |
| Total non-current liabilities            |   |         | 6,962,257  |   |   |   | 3,295,738 |   |   |   | 15,618,995 |   |
| Total liabilities                        |   |         | 29,031,105 |   |   |   | 12,578,371 |   |   |   | 27,529,071 |   |
| Class A Preferred Shares                 |   |         | —    |   |   |   | — |   |   |   | 43,929,923 |   |
| Owners’/Shareholders’ equity |   |         | 29,256,902 |   |   |   | 67,536,882 |   |   |   | 107,776,357 |   |
| Total liabilities and equity             |   | $            | 58,288,007 |   |   | $ | 80,115,253 |   |   | $ | 179,235,351 |   |

----

|                      |   |  Noon Buying Rate |   |
|--------------------------------|--------|------------------------|--------|
| Period                         |   | Period End             |   | Average (1) |   | Low |   | High |   |
|                           |   |                   |   | (RMB per $1.00) |   |   |   |
| 2006                           |   | 7.8041                 |   | 7.9579 |   | 8.0702 |   | 7.8041 |   |
| 2007                           |   | 7.2946                 |   | 7.5806 |   | 7.8127 |   | 7.2946 |   |
| 2008                           |   | 6.8225                 |   | 6.9193 |   | 7.2946 |   | 6.7800 |   |
| 2009                           |   | 6.8259                 |   | 6.8295 |   | 6.8470 |   | 6.8176 |   |
| 2010                           |   | 6.6000                 |   | 6.7696 |   | 6.8330 |   | 6.6000 |   |
| 2011                           |   |                   |
| January                        |   | 6.6017                 |   | 6.5964 |   | 6.6364 |   | 6.5809 |   |
| February                       |   | 6.5713                 |   | 6.5761 |   | 6.5965 |   | 6.5520 |   |
| March                          |   | 6.5483                 |   | 6.5645 |   | 6.5743 |   | 6.5483 |   |
| April                          |   | 6.4900                 |   | 6.5267 |   | 6.5477 |   | 6.4900 |   |
| May                            |   | 6.4786                 |   | 6.4957 |   | 6.5073 |   | 6.4786 |   |
| June                           |   | 6.4365                 |   | 6.4746 |   | 6.4830 |   | 6.4628 |   |
| July                           |   | 6.4360                 |   | 6.4575 |   | 6.4720 |   | 6.4360 |   |
| August                         |   | 6.3778                 |   | 6.4036 |   | 6.4401 |   | 6.3778 |   |
| September                      |   | 6.3780                 |   | 6.3885 |   | 6.3975 |   | 6.3780 |   |
| October                        |   | 6.3547                 |   | 6.3710 |   | 6.3825 |   | 6.3534 |   |
| November (through November 25) |   | 6.3802                 |   | 6.3512 |   | 6.3802 |   | 6.3400 |   |

|   | (1) | Annual averages are calculated using the average of month-end rates of the relevant year.  Monthly averages are calculated using the average of the daily rates during the relevant period. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | In some of the jurisdictions in which we operate, environmental and workers’ compensation liabilities may be assigned to us as a matter of law and may not be limited through contracts; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Insurance coverage may not be sufficient because it may not be possible to obtain adequate insurance against some risks on commercially reasonable terms, or at all.  Insurance products, in particular, have become increasingly expensive and sometimes very difficult to obtain.  In this regard, consistent with what we believe is customary practice in the PRC, we do not carry any business interruption insurance.  While we do have Ship Pollution Liability coverage for certain environmental damage and third-party losses that arise from fuel or chemical leaks from the three vessels that we own, there may be circumstances in which we would not be fully covered or compensated for losses and liabilities arising from interruptions to our operations, construction accidents, defects in our work or other risks by insurance that we have maintained.  Our Ship Pollution Liability coverage is for up to approximately $732,000 annually for Xinggangjun #66, $366,000 annually for Xinggangjun #3, $309,000 annually for Xinggangjun #6 and $309,000 annually for Xinggangjun #9. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | (1) | Xinrong Zhuo is our Chairman of the Board of Directors and Chief Executive Officer, Bin Lin is our Senior Vice President, and Kit Chan is one of our independent directors. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Assumes the conversion of all of our preferred shares into ordinary shares. |
|--------|-----|-----------------------------------------------------------------------------|

|   | (3) | Qing Lin is the brother-in-law of Xinrong Zhuo, our Chairman of the Board of Directors and Chief Executive Officer, and holds 91% interest as the representative of the family. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (4) | Panxing Zhuo is the father of Xinrong Zhuo, our Chairman of the Board of Directors and Chief Executive Officer, and holds 9% interest as the representative of the family. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | project schedule (consistent with the project conditions and payment schedule); |
|--------|--------|---------------------------------------------------------------------------------|

|   | · | labor deployment (consistent with the skill level and the estimated number of workers for each type of work); |
|--------|--------|---------------------------------------------------------------------------------------------------------------|

|   | · | provision of temporary office and public utilities, for example, water, electricity and telephone; and |
|--------|--------|--------------------------------------------------------------------------------------------------------|

|   | · | work plans/instructions detailed for each phase of the project. |
|--------|--------|-----------------------------------------------------------------|

----

| Trailer SuctionHopper Dredgers |   | Capacity(cubicmeters perhour) |   | Leased/Owned |   | Purchase/Lease Date |   | Year Built |
|------------------------------------------|--------|------------------------------------|--------|--------------|--------|--------------------------|--------|-----------------|
| Hengshengjun #88                         |   | 3,500                              |   | Leased       |   | January 2008             |   | 1983            |
| Liya #10                                 |   | 6,500                              |   | Leased       |   | June 2010                |   | 1990            |
| Fuyuan #7                                |   | 7,000                              |   | Leased       |   | July 2011                |   | 2009            |

| Non-Self-Propelling CutterSuction Dredgers |   | Capacity(cubicmeters perhour) |   | Leased/Owned |   | Purchase/Lease Date |   | Year Built |
|------------------------------------------------------|--------|------------------------------------|--------|--------------|--------|--------------------------|--------|-----------------|
| Xinggangjun #3                                       |   | 2,000                              |   | Owned        |   | May 2008                 |   | 2008            |
| Xinggangjun #66                                      |   | 3,500                              |   | Owned        |   | March 2008               |   | 2008            |
| Xinggangjun #6                                       |   | 2,500                              |   | Owned        |   | May 2008                 |   | 2008            |
| Xinggangjun #9                                       |   | 2,500                              |   | Owned        |   | June 2008 (1)       |   | 2008            |
| Xiechang #18                                         |   | 2,500                              |   | Leased       |   | June 2010                |   | 2009            |
| Honglinjun #19                                       |   | 3,800                              |   | Leased       |   | April 2011               |   | 2009            |
| Fuyuan #5                                            |   | 3,000                              |   | Leased       |   | July 2011                |   | 2009            |
| Minningdejun #0099                                   |   | 2,500                              |   | Leased       |   | September 2011           |   | 1986            |

| Grab Dredgers |   | Capacity(cubicmeters perhour) |   | Leased/Owned |   | Purchase/Lease Date |   | Year Built |
|--------------------|--------|------------------------------------|--------|--------------|--------|--------------------------|--------|-----------------|
| Hengshunda #1      |   | 350                                |   | Leased       |   | June 2011                |   | 2007            |
| Liya #2       |   | 350                                |   | Leased       |   | June 2011                |   | 2007            |

|   | (1) | We commenced leasing Xinggangjun #9 in June 2008 and acquired it in January 2011. |
|--------|-----|-----------------------------------------------------------------------------------|

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| Supplier                                                      |   | Vessel Component List                                                         |   | Purchase Amount in 2008 ($ in millions) |    |   | Purchase Amount in 2009 ($ in millions) |   |    | PurchaseAmount in 2010 ($ in millions) |   |
|---------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------|---------|--------|-----------------------------------------------------------------------|--------|---------|-----------------------------------------------------------------|--------|
| Dalian Locomotive and Rolling Stock Co., Ltd. CNR Group       |   | Mud tube, steel tube, floating body, anchors floating, rubber hose, etc.                |   |                                                                  | 11.6    |   |                                                                  |   | 19.5    |                                                            |   |   | 9.6 |   |
| Tianjin Puyou Mech. & Elec. Equipment MFG. Co., Ltd.      |   | Anchor, pump, solenoid valve, governor rotating components, pressure sensors, etc. |   |                                                                  | 6.1     |   |                                                                  |   | 9.2     |                                                            |   |   | — |   |
| Taizhou Haiguang Mechanical Manufacturing Industrial Co., Ltd |   | Steel plate, angle iron, one-piece compound plate, etc.                            |   |                                                                  | 1.1     |   |                                                                  |   | 1.5     |                                                            |   |   | 1.4 |   |
| Shijiazhuang Shengshi Pump Co., Ltd                           |   | Rake head, lacquer, seal ring, steel tube, etc.                                    |   |                                                                  | — |   |                                                                  |   | — |                                                            |   |   | 9.1 |   |
| Sinohydro Bureau 13 Co., Ltd Rubber & Plastic Factory     |   | Floating pipe, rubber hose, rubber mat, etc.                                       |   |                                                                  | — |   |                                                                  |   | — |                                                            |   |   | 9.1 |   |

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|                                                                |   | For the Period from January 8, 2008 (Inception) to |       |   | For the Years Ended December 31, |   |
|---------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------|------------|--------|-----------------------------------------------------------|--------|
|                                                           |   | December 31, 2008                                                                |       |   | 2009                                                      |   |   | 2010 |   |
| Customer                                                            |   | Revenue                                                                                    |       |   | Percent ofTotal Revenue                         |   |   | Revenue |   |   | Percent of Total Revenue |   |   | Revenue |   |   | Percent of Total Revenue |   |
| China Communications Guangzhou Dredging Co., Ltd (State-Owned) |   | $                                                                                          | 26,300,469 |   |                                                      |   | 48.3 | % |   | $ | 25,832,823 |   |   |   | 32.2 | % |   | $ | 27,171,214 |   |   |   | 20.7 | % |
| Shenzhen Guoyuan Engineering Co., Ltd                               |   |                                                                                       | 11,537,796 |   |                                                      |   | 21.2 | % |   |   | 8,804,504 |   |   |   | 10.9 | % |   |   | 7,682,169 |   |   |   | 5.8 | % |
| Shenzhen Guangjun Engineering Co., Ltd                              |   |                                                                                       | 13,028,044 |   |                                                      |   | 23.9 | % |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Shenzhen Shekou Merchants Harbor Engineering Co., Ltd               |   |                                                                                       | 3,613,962  |   |                                                      |   | 6.6 | % |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| China Communications Shanghai Dredging Co., Ltd (State-Owned)       |   |                                                                                       | —    |   |                                                      |   | — |   |   |   | 13,354,633 |   |   |   | 16.6 | % |   |   | 47,876,031 |   |   |   | 36.4 | % |
| Changjiang Wuhan Waterway Engineering Company (State-Owned)         |   |                                                                                       | —    |   |                                                      |   | — |   |   |   | 32,341,931 |   |   |   | 40.3 | % |   |   | 5,086,628 |   |   |   | 3.9 | % |
| Guangdong Jindonghai Holding Co., LTD                               |   |                                                                                       | —    |   |                                                      |   | — |   |   |   | — |   |   |   | — |   |   |   | 4,297,557 |   |   |   | 3.3 | % |
| Tianjin Hongdeshengyu Port Engineering Co., LTD                     |   |                                                                                       | —    |   |                                                      |   | — |   |   |   | — |   |   |   | — |   |   |   | 13,920,732 |   |   |   | 10.6 | % |
| CCCC Tianjin Dredging Co., LTD                                      |   |                                                                                       | —    |   |                                                      |   | — |   |   |   | — |   |   |   | — |   |   |   | 13,694,917 |   |   |   | 10.4 | % |
| COECG Dalian Bureau                                                 |   |                                                                                       | —    |   |                                                      |   | — |   |   |   | — |   |   |   | — |   |   |   | 10,739,467 |   |   |   | 8.2 | % |
| ShenZhen Hangfeng Dredging Engineering Co., Ltd.                    |   |                                                                                       | —    |   |                                                      |   | — |   |   |   | — |   |   |   | — |   |   |   | 936,950 |   |   |   | 0.7 | % |
| Total                                                               |   | $                                                                                          | 54,480,271 |   |                                                      |   | 100.0 | % |   | $ | 80,333,891 |   |   |   | 100.0 | % |   | $ | 131,405,665 |   |   |   | 100.0 | % |

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|   | · | A general contractor is permitted to contract for the overall work entailed in a project. A general contractor can perform all works that are contracted for itself, or subcontract non-core construction works or labor services to qualified professional services contractors or qualified labor services sub-contractors. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | A qualified professional service contractor may enter into a contract to provide professional services subcontracted out by a main contractor. Under such contracts, a professional services contractor may undertake all of the contracted work by itself, or subcontract out the labor services to qualified labor services sub-contractors. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | A qualified labor services sub-contractor may enter into a contract to provide labor services contracted out by a general contractor or a professional services contractor. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Subsidiary Name                           |    | Country ofRegistration |    | Economic and Voting Interest                    |
|------------------------------------------------|--------------|-----------------------------|--------------|----------------------------------------------------------------|
|                                           |         |                        |         |                                                           |
| China Dredging (HK) Company Limited            |         | Hong Kong                   |         | 100% direct                                                    |
| Fujian WangGang Dredging Construction Co. Ltd. |         | PRC                         |         | 100% direct                                                    |
| Fujian Xing Gang Port Service Co. Ltd.         |         | PRC                         |         | 100% (50% direct and 50% as VIE) |
| Wonder Dredging Engineering LLC                |         | PRC                         |         | 100% (as VIE)                                                  |

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|   | · | transferred to Fujian WangGang voting and operational control of the 50% of Fujian Service that it does not directly own; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------|

|   | · | conveyed to Fujian WangGang all profits and cash flows derived from the operations of Fujian Service; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------|

|   | · | granted Fujian WangGang the right to acquire all of the interests in Fujian Service that it does not directly own for no additional consideration, after giving effect to capital contribution agreements by certain of the parties. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | Governmental policies and availability of sub-contract opportunities.  Our opportunities to bid on dredging subcontracts depends significantly upon the PRC government’s public spending on port and navigable waterway projects and for land reclamation.  The nature, extent and timing of these projects, however, is affected by the interplay of a variety of factors, including the PRC government’s spending commitments to improve and maintain marine transportation infrastructure industry and the general conditions and prospects of the PRC economy.  The pattern of PRC government spending and economic activity has been robust and growing since the inception of Fujian Service and we expect this trend to continue for the foreseeable future, with the result that we believe the demand for dredging exceeds the immediate industry capacity and will continue to do so for the foreseeable future.  These constrained conditions permit dredging contractors, and sub-contractors such as us, to keep their fleet utilization at high levels and give them a limited degree of positive pricing power.  We expect this favorable dynamic to continue, and it is the basis of and is evidenced by the positive trend of unit prices that we have experienced since 2008.  The intent expressed in the long-term cooperation agreements executed by China Communications, and Changjiang Waterway to grow their business with us at rates of 20% per annum or more through 2014 is a further indication of the favorable nature of current market conditions. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our dredging fleet capacity to undertake contracts.  Since inception, we have had more dredging work contracted than we could immediately perform.  We own or lease three trailer suction hopper dredgers, eight non-self-propelling cutter suction dredgers, and two grab dredgers, and we have entered into two agreements to purchase two new non-self-propelling cutter suction dredgers.  Therefore, the continued addition of new vessels to the fleet will be required to grow our revenue and profitability, notwithstanding the contract backlog we have. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our ability to manage our costs under fixed-price contracts.  Substantially all of our revenue-generating contracts are fixed-price contracts under which we are paid a specified price for our performance of the entire contract.  Fixed-price contracts carry inherent risks, including risks of losses from underestimating costs of materials, operational difficulties and other changes that may occur during the contract period.  As a result, we can only realize profits on these contracts if we successfully estimate project costs and avoid cost overruns.  To limit our exposures to fixed contract prices, we strive to keep contract durations short (less than one year) and we endeavor to rigorously manage each individual project.  Short contract periods also limit our exposure to uncertainties in determining final contract values. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Provision of key supplies and operational support by customers.  To date, our customers have generally provided key operating supplies (most notably fuel) and support services (such as supply ships and tug services for repositioning non-self-propelling dredgers) for our operations at no charge to us under our contracts.  We believe this arrangement is typical for dredging subcontracts in the PRC, but may not be the norm for other companies operating outside of the PRC.  Consequently, it may be difficult to compare our results of operations with dredging service companies operating elsewhere or which do not enjoy similar arrangements.  The availability of customer-supplied supplies and services has had the effect of lowering our revenue and our capital and working capital requirements and reported costs relative to what they would have been if we were required to provide such items ourselves and charged our customers for them.  We believe it also materially lowers our exposures under our fixed-price contracts because there is no risk to us from changes in the prices, or errors in estimating the cost, of such items.  The historical pattern of customer-furnished supplies and support may not continue, although the contracts included in our backlog all provide for this. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | Our ability to operate our dredgers at or above nameplate rates and at high levels of utilization.  We strive to keep our dredgers in operation 24 hours per day, 7 days per week, the theoretical maximum, and to reduce downtime for maintenance, redeployment to new dredging sites and between projects as needed to coordinate project completion and start dates with third parties.  However, as a practical matter, we believe that sustaining dredger operations in the range of 50 – 60% of the theoretical maximum constitutes full utilization of our dredger capacity and we estimate that we have achieved this since the inception of Fujian Service in 2008.  In general, we accomplish this objective by concentrating our business so that we deploy multiple dredgers on a single major project or on projects clustered in a single region or geographic area.  As a result, we are working in fewer locations and on fewer individual projects than the number of dredgers in our fleet, thereby ensuring prompt provisioning of spare parts and reduced downtime for vessel repositioning.  In addition, we strive to properly operate and maintain our dredgers and related capital equipment so that they achieve or exceed the nominal performance specifications of the manufacturers.  Our success in implementing such operating strategies directly influences our effective capacity, dredging volumes and revenues and can vary significantly when measured over short periods of time, such as quarter-to quarter.  It also allows us to reduce unit costs and increase margins by spreading fixed costs over the largest possible revenue base. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | The increased significance of lease expense in our operating costs.  In 2008 and 2009, we owned three dredgers and leased two dredgers, and our leased dredgers increased to six after June 2010.  This pattern of purchases and leases has resulted in the percentage of leased vessels increasing from 40% in 2008 and 2009 to more than 60% after June 2010, although the percentage decreased to 56% after we acquired one dredger in January 2011 that we previously leased.  Subsequent leases of four dredgers (net of two lease terminations) have increased our percentage of leased vessels to approximately 69%.  The inclusion of a higher percentage of lease expense in our operating costs has the effect of lowering our reported margins because lease costs tend to be higher than depreciation we report on vessels we own.  This change in the mix of our vessel ownership should be considered in making direct comparisons of expenses and margins for current and historical periods. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Backlog and business development pipeline.  Because contracts begin in one fiscal year or reporting period and are typically completed in a subsequent fiscal year or reporting period, we believe that the revenue recognized in a particular year or period is not, by itself, the best indicator that our business is expanding.  We believe that the prospects for future project work should normally also be considered.  We measure this important metric and related trends by calculating our project backlog, which comprises only unrealized revenue on executed contracts with specific schedules for commencement and firm pricing and includes as-yet-uncompleted work on in-progress dredging projects.  We only began to track this important metric in 2009, so the availability of trend information is limited.  Our backlog as of December 31, 2010 was $62.3 million, an amount consistent with our objective of maintaining firm contract levels that will keep our dredging fleet fully utilized for at least three to four months, taking into account prospective increases in our fleet size. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Backlog balance at December 31, 2009                                  |   | $      | 8,139,422    |   |
|-----------------------------------------------------------------------|--------|--------|--------------|--------|
| New contracts entered into during the year ended December 31, 2010    |   |   | 184,386,368  |   |
| Add: Adjustment of contracts due to change orders during the year     |   |   | 1,190,626    |   |
| Adjusted contract amount at December 31, 2010                         |   |   | 193,716,416  |   |
| Less: Contract revenue earned during the year ended December 31, 2010 |   |   | (131,405,665 | )      |
| Backlog balance at December 31, 2010*                                 |   | $      | 62,310,751   |   |

|   | * | We have excluded from the backlog three one-year contracts with two of our largest customers totaling approximately $44.6 million (at the closing date of December 31, 2010), which were previously reported in our backlog as of June 30, 2010.  These three contracts were formally deferred in October 2010 by mutual written agreement between us and our customers, but discussions were underway prior to reaching agreement on the deferral.  By mutual agreement, these three contracts were, subsequent to December 31, 2010, replaced by three other one-year contracts for which work has commenced with an aggregate contract value of approximately $61.0 million. |
|--------|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                     |   | For the Period from          |       |   |                                                      |   |
|--------------------------|--------|----------------------------------------|------------|--------|-----------------------------------------------------------|--------|
|                     |   | January 8, 2008                        |       |   |                                                      |   |
|                     |   | (Inception) to                    |       |   | For the Years Ended December 31, |   |
|                |   | December 31, 2008(Fujian Service) |       |   | 2009(Fujian Service)                                 |   |   | 2010(China Dredging) |   |
|                |   | Amount                                 |       |   | % ofCost                                             |   |   | Amount |   |   | % ofCost |   |   | Amount |   |   | % ofCost |   |
| Wages                    |   | $                                      | 596,694    |   |                                                      |   | 2.3 | % |   | $ | 861,861 |   |   |   | 2.2 | % |   | $ | 885,561 |   |   |   | 1.5 | % |
| Leasing fees             |   |                                   | 1,273,713  |   |                                                      |   | 5 | % |   |   | 1,720,275 |   |   |   | 4.4 | % |   |   | 7,150,238 |   |   |   | 12.2 | % |
| Crew hire charge         |   |                                   | 1,110,149  |   |                                                      |   | 4.4 | % |   |   | 1,457,329 |   |   |   | 3.8 | % |   |   | 2,685,442 |   |   |   | 4.6 | % |
| Consumable parts         |   |                                   | 18,757,168 |   |                                                      |   | 73.8 | % |   |   | 29,724,508 |   |   |   | 76.8 | % |   |   | 42,964,969 |   |   |   | 73.1 | % |
| Depreciation             |   |                                   | 3,686,503  |   |                                                      |   | 14.5 | % |   |   | 4,951,517 |   |   |   | 12.8 | % |   |   | 5,037,318 |   |   |   | 8.6 | % |
| Cost of contract revenue |   | $                                      | 25,424,227 |   |                                                      |   | 100 | % |   | $ | 38,715,490 |   |   |   | 100 | % |   | $ | 58,723,528 |   |   |   | 100 | % |

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|                                                |   | December 31,2010 |       |
|-----------------------------------------------------|--------|-----------------------|------------|
| Liability balance b/f                               |   | $                     | -          |   |
| Additional liabilities entered into the period/year |   |                  | 15,607,697 |   |
| Increase in liability fair value                    |   |                  | 11,298     |   |
| Liability balance c/f                               |   | $                     | 15,618,995 |   |

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----

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|                           |   | For the Years Ended December 31, |        |   | Increase                        |   |   | Percent    |   |   | PercentChange |   |
|-------------------------------------|--------|-----------------------------------------------------------|-------------|--------|---------------------------------|--------|--------|------------|--------|--------|---------------|--------|
|                           |   | 2009 (Fujian Service)                           |        |   | 2010 (China Dredging) |   |   | (Decrease) |   |   | Change        |   |   | in RMB |   |
| Contract revenue                    |   | $                                                         | 80,333,891  |   |                            |   | 100.0  | %     |   | $      | 131,405,665   |   |   |   | 100.0 | % |   | $ | 51,071,774 |   |   |   | 63.6 | % |   |   | 61.9 | % |
| Cost of contract revenue            |   |                                                      | (38,715,490 | )      |                            |   | (48.2  | )%         |   |   | (58,723,528   | )      |   |   | (44.7 | )% |   |   | 20,008,038 |   |   |   | 51.7 | % |   |   | 50.2 | % |
| Gross profit                        |   |                                                      | 41,618,401  |   |                            |   | 51.8   | %          |   |   | 72,682,137    |   |   |   | 55.3 | % |   |   | 31,063,736 |   |   |   | 74.6 | % |   |   | 72.8 | % |
| General and administrative expenses |   |                                                      | (2,531,132  | )      |                            |   | (3.2   | )%         |   |   | (7,159,793    | )      |   |   | (5.4 | )% |   |   | 4,628,661 |   |   |   | 182.9 | % |   |   | 182.9 | % |
| Income from operations              |   |                                                      | 39,087,269  |   |                            |   | 48.7   | %          |   |   | 65,522,344    |   |   |   | 49.9 | % |   |   | 26,435,075 |   |   |   | 67.6 | % |   |   | 65.7 | % |
| Other income (expense)              |   |                                                      | (726,020    | )      |                            |   | (0.9   | )%         |   |   | (731,668      | )      |   |   | (0.6 | )% |   |   | 5,648 |   |   |   | 0.8 | % |   |   | (0.3 | )% |
| Income before income taxes          |   |                                                      | 38,361,249  |   |                            |   | 47.8   | %          |   |   | 64,790,676    |   |   |   | 49.3 | % |   |   | 26,429,427 |   |   |   | 68.9 | % |   |   | 67.0 | % |
| Income tax expense                  |   |                                                      | (9,596,651  | )      |                            |   | (11.9  | )%         |   |   | (16,556,396   | )      |   |   | (12.6 | )% |   |   | 6,959,745 |   |   |   | 72.5 | % |   |   | 70.8 | % |
| Net income                          |   | $                                                         | 28,764,598  |   |                            |   | 35.8   | %          |   | $      | 48,234,280    |   |   |   | 36.7 | % |   | $ | 19,469,682 |   |   |   | 67.7 | % |   |   | 65.7 | % |

| Backlog balance at December 31, 2009                                             |   | $      | 8,139,422    |                |
|----------------------------------------------------------------------------------|--------|--------|--------------|---------------------|
| New contracts entered during the year ended December 31, 2010                    |   |   | 184,386,368  |                |
| Add:  Adjustment of contracts due to change orders during the year     |   |   | 1,190,626    |                |
| Adjusted contract amount at December 31, 2010                                    |   |   | 193,716,416  |                |
| Less:  Contract revenue earned during the year ended December 31, 2010 |   |   | (131,405,665 | )    |
| Backlog balance at December 31, 2010                                             |   | $      | 62,310,751   |                |

|   |   | Q1     |   |   | Q2     |   |   | Q3 |   |   | Q4   |   |   | Year Average |   |
|--------|--------|--------|--------|--------|--------|--------|--------|----|--------|--------|------|--------|--------|-------------------|--------|
| 2010   |   |   | 2.9    | %      |   |   | 4.4    | %  |   |   | 10.9 | %      |   |              | 17.8   | % |   |   | 10.5 | % |
| 2009   |   |   | 18.0   | %      |   |   | 2.4    | %  |   |   | 10.0 | %      |   |              | 3.5    | % |   |   | 8.4 | % |

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|                     |   | For the Years Ended December 31, |       |
|--------------------------|--------|-----------------------------------------------------------|------------|
|                     |   | 2009(Fujian Service)                                 |       |   | 2010(China Dredging) |   |
|                     |   | Amount                                                    |       |   | Average unit cost (per cubic meter) |   |   | Percentage of Revenue |   |   | Amount |   |   | Averageunit cost(per cubic meter) |   |   | Percentage of Revenue |   |
| Wages                    |   | $                                                         | 861,861    |   |   | $ | 0.02 |   |   |   | 1.1 | % |   | $ | 885,561 |   |   | $ | 0.01 |   |   |   | 0.7 | % |
| Leasing fees             |   |                                                      | 1,720,275  |   |   |   | 0.03 |   |   |   | 2.1 | % |   |   | 7,150,238 |   |   |   | 0.09 |   |   |   | 5.4 | % |
| Crew hire charge         |   |                                                      | 1,457,329  |   |   |   | 0.03 |   |   |   | 1.8 | % |   |   | 2,685,442 |   |   |   | 0.03 |   |   |   | 2.1 | % |
| Consumable parts         |   |                                                      | 29,724,508 |   |   |   | 0.57 |   |   |   | 37.0 | % |   |   | 42,964,969 |   |   |   | 0.55 |   |   |   | 32.7 | % |
| Depreciation             |   |                                                      | 4,951,517  |   |   |   | 0.10 |   |   |   | 6.2 | % |   |   | 5,037,318 |   |   |   | 0.06 |   |   |   | 3.8 | % |
| Cost of contract revenue |   | $                                                         | 38,715,490 |   |   | $ | 0.75 |   |   |   | 48.2 | % |   | $ | 58,723,528 |   |   | $ | 0.74 |   |   |   | 44.7 | % |

----

|                            |   | For the Years Ended December 31, |      |
|--------------------------------------|--------|-----------------------------------------------------------|-----------|
|                            |   | 2009(Fujian Service)                                 |      |   | 2010(China Dredging) |   |
|                            |   | Amount                                                    |      |   | % of TotalG&A |   |   | % of TotalRevenue |   |   | Amount |   |   | % of TotalG&A |   |   | % of TotalRevenue |   |
| Revenue tax expenses*                |   | $                                                         | 1,991,493 |   |   |   | 78.7 | % |   |   | 2.5 | % |   | $ | 5,111,870 |   |   |   | 71.4 | % |   |   | 3.9 | % |
| Salary and benefits                  |   |                                                      | 159,808   |   |   |   | 6.3 | % |   |   | 0.2 | %  |   |   | 239,916 |   |   |   | 3.3 | % |   |   | 0.2 | % |
| Operating insurance                  |   |                                                      | 187,575   |   |   |   | 7.4 | % |   |   | 0.3 | % |   |   | 191,153 |   |   |   | 2.7 | % |   |   | 0.1 | % |
| Other expenses                       |   |                                                      | 192,256   |   |   |   | 7.6 | % |   |   | 0.2 | % |   |   | 312,633 |   |   |   | 4.4 | % |   |   | 0.2 | % |
| Financing and restructuring expenses |   |                                                      | —   |   |   |   | — |   |   |   | — |   |   |   | 1,304,221 |   |   |   | 18.2 | % |   |   | 1.0 | % |
| Total G&A                        |   | $                                                         | 2,531,132 |   |   |   | 100.0 | % |   |   | 3.2 | % |   | $ | 7,159,793 |   |   |   | 100.0 | % |   |   | 5.4 | % |

|   | * | In the PRC, provincial and local governments levy certain taxes based on revenue and we record this tax expense as a general and administrative expense. |
|--------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                           |   | Fujian ServicePeriod/Year Ended December 31, |        |   | Increase |   |   | Percent    |   |   | PercentChange in |   |
|-------------------------------------|--------|------------------------------------------------------------------|-------------|--------|----------|--------|--------|------------|--------|--------|-----------------------|--------|
|                                |   | 2008                                                             |        |   | 2009     |   |   | (Decrease) |   |   | Change                |   |   | RMB |   |
| Contract revenue                    |   | $                                                                | 54,480,271  |   |     |   | 100.0  | %          |   | $      | 80,333,891            |   |   |   | 100.0 | % |   | $ | 25,853,620 |   |   |   | 47.5 | % |   |   | 45.2 | % |
| Cost of contract revenue            |   |                                                             | (25,424,227 | )      |     |   | (46.7  | )%         |   |   | (38,715,490           | )      |   |   | (48.2 | )% |   |   | 13,291,263 |   |   |   | 52.3 | % |   |   | 50.0 | % |
| Gross profit                        |   |                                                             | 29,056,044  |   |     |   | 53.3   | %          |   |   | 41,618,401            |   |   |   | 51.8 | % |   |   | 12,562,357 |   |   |   | 43.2 | % |   |   | 41.1 | % |
| General and administrative expenses |   |                                                             | (2,152,575  | )      |     |   | (4.0   | )%         |   |   | (2,531,132            | )      |   |   | (3.2 | )% |   |   | 378,557 |   |   |   | 17.6 | % |   |   | 15.8 | % |
| Income from operations              |   |                                                             | 26,903,469  |   |     |   | 49.4   | %          |   |   | 39,087,269            |   |   |   | 48.7 | % |   |   | 12,183,800 |   |   |   | 45.3 | % |   |   | 43.1 | % |
| Other Income (expense)              |   |                                                             | (136,332)   |   |     |   | (0.3   | )%         |   |   | (726,020              | )      |   |   | (0.9) | % |   |   | 589,688 |   |   |   | 432.5 | % |   |   | 424.5 | % |
| Income before income taxes          |   |                                                             | 26,767,137  |   |     |   | 49.1   | %          |   |   | 38,361,249            |   |   |   | 47.8 | % |   |   | 11,594,112 |   |   |   | 43.3 | % |   |   | 41.1 | % |
| Income tax expense                  |   |                                                             | (6,696,745  | )      |     |   | (12.3  | )%         |   |   | (9,596,651            | )      |   |   | (12.0 | )% |   |   | 2,899,906 |   |   |   | 43.3 | % |   |   | 41.1 | % |
| Net income                          |   | $                                                                | 20,070,392  |   |     |   | 36.8   | %          |   | $      | 28,764,598            |   |   |   | 35.8 | % |   | $ | 8,694,206 |   |   |   | 43.3 | % |   |   | 41.1 | % |

----

|                |   | Fujian Service                                                                                             |       |
|--------------------------|--------|-----------------------------------------------------------------------------------------------------------------|------------|
|                |   | For the Period fromJanuary 8, 2008 (Inception)to December 31, 2008 |       |   | For the Year EndedDecember 31, 2009 |   |
|                |   | Amount                                                                                                          |       |   | AverageUnit Cost(per CubicMeter) |   |   | Percentageof Revenue |   |   | Amount |   |   | AverageUnit Cost(per CubicMeter) |   |   | Percentageof Revenue |   |
| Wages                    |   | $                                                                                                               | 596,694    |   |   | $ | 0.01 |   |   |   | 1.1 | % |   | $ | 861,861 |   |   | $ | 0.02 |   |   |   | 1.1 | % |
| Leasing fees             |   |                                                                                                            | 1,273,713  |   |   |   | 0.03 |   |   |   | 2.3 | % |   |   | 1,720,275 |   |   |   | 0.03 |   |   |   | 2.1 | % |
| Crew hire charge         |   |                                                                                                            | 1,110,149  |   |   |   | 0.03 |   |   |   | 2.1 | % |   |   | 1,457,329 |   |   |   | 0.03 |   |   |   | 1.8 | % |
| Consumable parts         |   |                                                                                                            | 18,757,168 |   |   |   | 0.47 |   |   |   | 34.4 | % |   |   | 29,724,508 |   |   |   | 0.57 |   |   |   | 37.0 | % |
| Depreciation             |   |                                                                                                            | 3,686,503  |   |   |   | 0.09 |   |   |   | 6.8 | % |   |   | 4,951,517 |   |   |   | 0.10 |   |   |   | 6.2 | % |
| Cost of contract revenue |   | $                                                                                                               | 25,424,227 |   |   | $ | 0.63 |   |   |   | 46.7 | % |   | $ | 38,715,490 |   |   | $ | 0.75 |   |   |   | 48.2 | % |

----

|             |   | Fujian Service                                                                                                    |      |
|-----------------------|--------|------------------------------------------------------------------------------------------------------------------------|-----------|
|             |   | For the Period from January 8, 2008 (Inception) to December 31, 2008 |      |   | For the Year Ended December 31, 2009 |   |
|             |   | Amount                                                                                                                 |      |   | % of TotalG&A |   |   | % of TotalRevenue |   |   | Amount |   |   | % ofTotal G&A |   |   | % of TotalRevenue |   |
| Revenue tax expenses* |   | $                                                                                                                      | 1,794,860 |   |   |   | 83.4 | % |   |   | 3.3 | % |   | $ | 1,991,493 |   |   |   | 78.7 | % |   |   | 2.5 | % |
| Salary and benefits   |   |                                                                                                                   | 140,014   |   |   |   | 6.5 | % |   |   | 0.3 | % |   |   | 159,808 |   |   |   | 6.3 | % |   |   | 0.2 | % |
| Operating insurance   |   |                                                                                                                   | 103,056   |   |   |   | 4.8 | % |   |   | 0.2 | % |   |   | 187,575 |   |   |   | 7.4 | % |   |   | 0.3 | % |
| Other expenses        |   |                                                                                                                   | 75,632    |   |   |   | 5.3 | % |   |   | 0.2 | % |   |   | 192,256 |   |   |   | 7.6 | % |   |   | 0.2 | % |
| Total G&A         |   | $                                                                                                                      | 2,152,575 |   |   |   | 100.0 | % |   |   | 4.0 | % |   | $ | 2,531,132 |   |   |   | 100.0 | % |   |   | 3.2 | % |

|   | * | In the PRC, provincial and local governments levy certain taxes based on revenue and we record this tax expense as a general and administrative expense. |
|--------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                       |   | For the Period from |        |   |                               |   |
|-----------------------------------------------------------------|--------|-------------------------------|-------------|--------|------------------------------------|--------|
|                                                       |   | January 8, 2008          |        |   | For the Years Ended |   |
|                                                       |   | (Inception) to                |        |   | December 31,                  |   |
|                                                       |   | December 31, 2008        |        |   | 2009                               |   |   | 2010 |   |
|                                                       |   | (Fujian Service)              |        |   | (Fujian Service)              |   |   | (China Dredging) |   |
| Cash flows provided by operating activities |   | $                             | 26,096,112  |   |                               | $      | 30,952,939 |   |   | $ | 51,758,576 |   |
| Cash flows used in investing activities     |   |                          | (42,059,354 | )      |                               |   | (2,196,096 | ) |   |   | (24,965,015 | ) |
| Cash flows provided by/(used in) financing activities           |   |                          | 17,303,282  |   |                               |   | (6,785,017 | ) |   |   | 36,893,785 |   |
| Net increase in cash                                            |   |                          | 1,340,040   |   |                               |   | 21,971,826 |   |   |   | 63,687,346 |   |
| Cash at beginning of year/period                                |   |                          | —     |   |                               |   | 1,362,142 |   |   |   | 23,343,469 |   |
| Cash at end of year/period                                      |   | $                             | 1,362,142   |   |                               | $      | 23,343,469 |   |   | $ | 88,532,472 |   |

----

----

|                                                                       |   | For the Period fromJanuary 8, 2008(Inception) to |       |   | For the Years EndedDecember 31, |   |
|----------------------------------------------------------------------------|--------|---------------------------------------------------------------------------|------------|--------|-----------------------------------------------------|--------|
|                                                                  |   | December 31, 2008(Fujian Service)                          |       |   | 2009(Fujian Service)                           |   |   | 2010(China Dredging) |   |
| Net income                                                                 |   | $                                                                         | 20,070,392 |   |                                                | $      | 28,764,598 |   |   | $ | 48,234,280 |   |
| Adjustments to reconcile net income to net cash                            |   |                                                                      |       |   |                                                |   |   |   |   |   |   |   |
| Add:  depreciation expense                                       |   |                                                                      | 3,686,744  |   |                                                |   | 4,952,236 |   |   |   | 5,038,074 |   |
| Loss on derivative                                                         |   |                                                                      | —    |   |                                                |   | — |   |   |   | 11,298 |   |
| Changes in operating assets and liabilities:                               |   |                                                                      |       |   |                                                |   |   |   |   |   |   |   |
| Accounts receivable, net                                                   |   |                                                                      | —    |   |                                                |   | — |   |   |   | (12,536,435 | ) |
| Cost and estimated earnings in excess of billings on contracts in progress |   |                                                                      | —    |   |                                                |   | (2,210,343 | ) |   |   | 1,418,098 |   |
| Other receivables                                                          |   |                                                                      | —    |   |                                                |   | (311 | ) |   |   | (905 | ) |
| Inventories                                                                |   |                                                                      | —    |   |                                                |   | (429,018 | ) |   |   | 236,039 |   |
| Accounts payable                                                           |   |                                                                      | —    |   |                                                |   | — |   |   |   | 4,380,904 |   |
| Income taxes payable                                                       |   |                                                                      | 2,186,909  |   |                                                |   | (179,402 | ) |   |   | 2,656,355 |   |
| Accrued liabilities and other payables                                     |   |                                                                      | 152,067    |   |                                                |   | 55,179 |   |   |   | 2,320,868 |   |
| Net cash provided by operating activities                                  |   | $                                                                         | 26,096,112 |   |                                                | $      | 30,952,939 |   |   | $ | 51,758,576 |   |

|   | · | depreciation of $5 million. |
|--------|--------|-----------------------------|

|   | · | growth in our accounts payable of $4.4 million in 2010 compared to 2009.  This change was attributable primarily to accruals for the use of consumable parts by the four additional dredgers acquired in June 2010 and payables in accordance with the leases.  According to the agreements regarding our four new dredgers, the lessors would purchase components needed for dredging projects and we would reimburse them. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a decrease in our inventories of $0.2 million in 2010 compared to an increase of $0.4 million in 2009.  This decrease occurred even though our revenues grew more during 2010 than 2009, primarily due to our increased need of inventory largely passed on to dredger lessors and accounted for as accounts payable. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | an increase in accrued liabilities and other payables of $2.3 million in 2010 compared to approximately $0.1 million in 2009.  This increase was attributable primarily to the accrual of leasing fees and crew hire charges in 2010.  The payment terms of three of the four dredgers leased during June 2010 permit payment of lease fees and crew hire charges in arrears.  This differs from the terms of our other dredger leases, which require us to pay lease fees and crew hire charges prior to the end of each month of operation. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                             |   | For the Period fromJanuary 8, 2008(Inception) to |        |   | For the Years EndedDecember 31, |   |
|-------------------------------------------------------|--------|---------------------------------------------------------------------------|-------------|--------|-----------------------------------------------------|--------|
|                                             |   | December 31, 2008(Fujian Service)                          |        |   | 2009(Fujian Service)                           |   |   | 2010(China Dredging) |   |
| Deposits paid for dredgers             |   | $                                                                         | —     |   |                                                | $      | (2,196,096 | ) |   | $ | (12,194,972 | ) |
| Changes in security deposits                          |   |                                                                      | (8,291,156  | )      |                                                |   | — |   |   |   | (12,440,092 | ) |
| Payment of purchases of property, plant and equipment |   |                                                                      | (33,768,198 | )      |                                                |   | — |   |   |   | (329,951 | ) |
| Net cash used in investing activities                 |   | $                                                                         | (42,059,354 | )      |                                                | $      | (2,196,096 | ) |   | $ | (24,965,015 | ) |

----

|                                                |   | For the Period fromJanuary 8, 2008(Inception) to |       |   | For the Years EndedDecember 31, |   |
|-----------------------------------------------------|--------|---------------------------------------------------------------------------|------------|--------|-----------------------------------------------------|--------|
|                                           |   | December 31, 2008(Fujian Service)                          |       |   | 2009(Fujian Service)                           |   |   | 2010(China Dredging) |   |
| Proceeds from short-term loan                       |   | $                                                                         | —    |   |                                                | $      | 3,367,348 |   |   | $ | — |   |
| Repayment of short-term loan                        |   |                                                                      | —    |   |                                                |   | — |   |   |   | (3,402,166 | ) |
| Proceeds from long-term loan                        |   |                                                                      | 8,651,641  |   |                                                |   | — |   |   |   | 11,389,859 |   |
| Repayment of long-term loan                         |   |                                                                      | —    |   |                                                |   | (1,830,080 | ) |   |   | (18,416,070 | ) |
| Repayment of dredger payable                        |   |                                                                      | —    |   |                                                |   | (17,838,704 | ) |   |   | — |   |
| Proceeds from capital issue                         |   |                                                                      | —    |   |                                                |   | — |   |   |   | 878,876 |   |
| Proceeds from share issue                           |   |                                                                      | —    |   |                                                |   | — |   |   |   | 46,443,286 |   |
| Capital contributions from owners                   |   |                                                                      | 8,651,641  |   |                                                |   | 9,516,419 |   |   |   | — |   |
| Net cash provided by/(used in) financing activities |   | $                                                                         | 17,303,282 |   |                                                | $      | (6,785,017 | ) |   | $ | 36,893,785 |   |

----

|                             |   | Payments due by period |       |
|---------------------------------------|--------|---------------------------------------|------------|
| Contractual Obligations          |   | Total                                 |       |   | < 1 year |   |   | 1 – 3 years |   |   | 3 – 5 years |   |   | > 5 years |   |
| Operating lease obligations           |   |                                  |       |   |   |   |   |   |   |   |   |   |   |   |   |
| - related party transactions     |   | $                                     | 72,680     |   |   | $ | 24,936 |   |   | $ | 35,808 |   |   | $ | 11,936 |   |   | $ | — |   |
| - non-related party transactions |   |                                  | 23,327,683 |   |   |   | 10,680,825 |   |   |   | 11,381,706 |   |   |   | 1,265,152 |   |   |   | — |   |
| Purchase obligations (1)              |   |                                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| - non-related party transactions |   |                                  | 36,755,878 |   |   |   | 20,071,114 |   |   |   | 16,684,764 |   |   |   | — |   |   |   | — |   |
| Capital commitments                   |   |                                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| - related party transactions (2) |   |                                  | 1,119,259  |   |   |   | 1,119,259 |   |   |   | — |   |   |   | — |   |   |   | — |   |
| - non-related party transactions (3)  |   |                                  | 28,030,303 |   |   |   | — |   |   |   | 28,030,303 |   |   |   | — |   |   |   | — |   |
| Total                                 |   | $                                     | 89,305,803 |   |   | $ | 31,896,134 |   |   | $ | 56,132,581 |   |   | $ | 1,277,088 |   |   | $ | — |   |

|   | (1) | Purchase obligations reflect our obligations to purchase consumable parts. |
|--------|-----|----------------------------------------------------------------------------|

|   | (2) | Capital commitments to related party transactions reflect the commitment to purchase dredger Xingangjun 9 from Fujian Lutong for $13.6 million.  We paid $12.5 million (including a reclassification of $5.2 million of a lease deposit) to Fujian Lutong as a deposit for the purchase of the dredger in 2010. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | Capital commitments to non-related party transactions reflect the commitment to purchase a new non-self propelling cutter suction dredger for $30.3 million.  We previously paid $2.3 million as a deposit for the purchase of the dredger. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

| A.  | Directors and Senior Management |
|----------|---------------------------------|

| Name             |   | Age |   | Position in China Dredging                      |
|------------------|--------|-----|--------|----------------------------------------------------------------|
| Mr. Xinrong Zhuo |   | 47  |   | Chairman of the Board of Directors and Chief Executive Officer |
| Mr. Alfred Ho    |   | 54  |   | Chief Financial Officer                                        |
| Mr. Fangjie Gu   |   | 33  |   | Chief Operating Officer and Director                           |
| Mr. Bin Lin      |   | 53  |   | Senior Vice President                                          |
| Mr. Kit Chan     |   | 64  |   | Independent director                                           |
| Mr. Yeliang Zhou |   | 62  |   | Independent director                                           |
| Mr. Zengbiao Zhu |   | 62  |   | Independent director                                           |

----

| B.  | Compensation |
|----------|--------------|

| Name and Principal Position                                                           |   | Salary($) |   |   | Bonus($) |   |   | Total($) |   |
|--------------------------------------------------------------------------------------------|--------|-----------|--------|--------|----------|--------|--------|----------|--------|
| Mr. Xinrong Zhuo, Chairman of the Board of Directors and Chief Executive Officer |   |      | 13,384 |   |     |   | 0      |     |   |   | 13,384 |   |
| Mr. Fangjie Gu, Chief Operating Officer and Director                                       |   |      | 4,120  |   |     |   | 0      |     |   |   | 4,120 |   |
| Mr. Alfred Ho, Chief Financial Officer                                                     |   |      | 9,653  |   |     |   | 0      |     |   |   | 9,653 |   |
| Mr. Bin Lin, Senior Vice President                                                         |   |      | 11,840 |   |     |   | 0      |     |   |   | 11,840 |   |

----

| C.  | Board Practices |
|----------|-----------------|

| Audit Committee   |   | Compensation Committee   |   | Nomination Committee |
|-----------------------------|--------|------------------------------------|--------|----------------------|
| Yeliang Zhou*     |   | Zengbiao Zhu*            |   | Kit Chan*            |
| Kit Chan          |   | Kit Chan                 |   | Yeliang Zhou         |
| Zengbiao Zhu      |   | Yeliang Zhou             |   | Zengbiao Zhu         |

|   | * | Chairman of the committee |
|--------|---|---------------------------|

|   | · | appointing, compensating, retaining, overseeing and terminating our independent auditors and pre-approving all audit and non-audit services permitted to be performed by the independent auditors; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | discussing with management and the independent auditors our annual audited financial statements, our internal control over financial reporting, and related matters; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | reviewing and approving any related party transactions, after reviewing each such transaction for potential conflicts of interest and other improprieties; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | assisting with the administration of our code of conduct; |
|--------|--------|-----------------------------------------------------------|

----

|   | · | meeting separately, periodically, with management, the internal auditors and the independent auditors; |
|--------|--------|--------------------------------------------------------------------------------------------------------|

|   | · | annually reviewing and reassessing the adequacy of our audit committee charter; |
|--------|--------|---------------------------------------------------------------------------------|

|   | · | such other matters that are specifically delegated to our audit committee by our board of directors from time to time; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------|

|   | · | reporting regularly to the board of directors. |
|--------|--------|------------------------------------------------|

|   | · | reviewing and making recommendations to the board regarding our compensation policies and forms of compensation provided to our directors and officers; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | reviewing and making recommendations to the board regarding bonuses for our officers and other employees; |
|--------|--------|-----------------------------------------------------------------------------------------------------------|

|   | · | reviewing and making recommendations to the board regarding share-based compensation for our directors and officers; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------|

|   | · | administering our share option plans in accordance with the terms thereof; and |
|--------|--------|--------------------------------------------------------------------------------|

|   | · | such other matters that are specifically delegated to the compensation committee by our board of directors after the business combination from time to time. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | overseeing the process by which individuals may be nominated to our board of directors after the business combination; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------|

|   | · | identifying potential directors and making recommendations as to the size, functions and composition of our board of directors after the business combination and its committees; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | considering nominees proposed by our shareholders; |
|--------|--------|----------------------------------------------------|

|   | · | establishing and periodically assessing the criteria for the selection of potential directors; and |
|--------|--------|----------------------------------------------------------------------------------------------------|

|   | · | making recommendations to the board of directors on new candidates for board membership. |
|--------|--------|------------------------------------------------------------------------------------------|

----

| D. | Employees |
|----|-----------|

| Dredger            |   | Quarterly Payment |      | Expiration Time |
|--------------------|--------|------------------------|-----------|----------------------|
| Hengshengjun #88   |   | $                      | 137,918   |                 | January 9, 2016 |
| Xiechang #18       |   |                   | 147,113   |                 | June 24, 2013 |
| Liya #10           |   |                   | 142,516   |                 | June 14, 2013 |
| Honglinjun #19     |   |                   | 160,905   |                 | April 26, 2014 |
| Fuyuan #5          |   |                   | 156,307   |                 | July 16, 2012 |
| Fuyuan #7          |   |                   | 160,905   |                 | July 18, 2012 |
| Hengshunda #1      |   |                   | 68,959    |                 | June 29, 2013 |
| Liya #2            |   |                   | 68,959    |                 | June 29, 2013 |
| Minningdejun #0099 |   |                   | 156,307   |                 | December 31, 2012 |
| TOTAL              |   | $                      | 1,199,889 |                 |   |

----

| E.  | Share Ownership |
|----------|-----------------|

| A.  | Major Shareholders |
|----------|--------------------|

|   | · | each of our directors and executive officers; |
|--------|--------|-----------------------------------------------|

|   | · | our directors and executive officers as a group; and |
|--------|--------|------------------------------------------------------|

|   | · | each person known to us to own beneficially 5% or more of our ordinary shares. |
|--------|--------|--------------------------------------------------------------------------------|

|                                                        |   | Shares Beneficially Owned |       |
|-------------------------------------------------------------|--------|-------------------------------------|------------|
|                                                        |   | Ordinary Shares                |       |
|                                                        |   | Number                              |       |   | Percent ofClass |   |
| Directors and Executive Officers:                           |   |                                |       |   |   |   |
| Mr. Xinrong Zhuo (1)                                   |   |                                | 33,852,703 |   |   |   | 64.3 | % |
| Mr. Kit Chan (2)                                       |   |                                | 2,608,866  |   |   |   | 4.9 | % |
| Mr. Fangjie Gu                                              |   |                                | 0          |   |   |   | 0 | % |
| Mr. Bin Lin (3)                                        |   |                                | 2,608,866  |   |   |   | 4.9 | % |
| Mr. Alfred Ho                                               |   |                                | 0          |   |   |   | 0 | % |
| Mr. Yeliang Zhou                                            |   |                                | 0          |   |   |   | 0 | % |
| Mr. Zengbiao Zhu                                            |   |                                | 0          |   |   |   | 0 | % |
| All directors and executive officers as a group (7 persons) |   |                                | 39,070,435 |   |   |   | 74.2 | % |
| Principal Shareholders:                                     |   |                                |       |   |   |   |   |   |
| SCGC Capital Holding Company Limited (4)               |   |                                | 3,440,000  |   |   |   | 6.1 | % |

----

|   | (1) | Shares are held of record by Mars Harvest Co. Ltd, Building 26, Mingyang Tianxia, No. 1 Yuquan Road, Fuzhou, Fujian Province, PRC. Mr. Zhuo is the sole director of Mars Harvest and has the power to vote and dispose of all of our ordinary shares that it holds. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Shares are held of record by Venus Seed Co., Ltd, Flat B, 27/F, Ko On Mansion, Taikoo Shing, Quarry Bay, Hong Kong. Mr. Chan is the sole director of Venus Seed and has the sole power to vote and dispose of all of our ordinary shares that it holds. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | Shares are held of record by Saturn Glory Co., Ltd., Room 1402, Building 8, D District, Rongqiao Jinjiang, No. 66, Jiangbin West Road, Fuzhou, Fujian Province, PRC. Mr. Lin is the sole director of Saturn Glory and has the sole power to vote and dispose of all of our ordinary shares that it holds. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (4) | SCGC Capital Holding Company Limited acquired 3,440,000 preferred shares through our 2010 Private Placement, each of which is convertible into one of our ordinary shares. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| B.  | Related Party Transactions |
|----------|----------------------------|

----

| C. | Interests of Experts and Counsel |
|----|----------------------------------|

| A. | Consolidated Statements and Other Financial Information. |
|----|----------------------------------------------------------|

| B. | Significant Changes |
|----|---------------------|

| A.  | Offer and Listing Details |
|----------|---------------------------|

| C.  | Markets |
|----------|---------|

| A. | Share Capital |
|----|---------------|

----

| B. | Memorandum and Articles of Association |
|----|----------------------------------------|

----

----

----

|   | · | restrict the rights or powers of the shareholders to amend our Articles of Association; |
|--------|--------|-----------------------------------------------------------------------------------------|

|   | · | change the percentage of shareholders required to pass a resolution of shareholders to amend our Articles of Association; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------|

|   | · | amend our Articles of Association in circumstances where our Articles of Association can only be amended by the shareholders; or |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------|

|   | · | change the maximum number of authorized shares or change the rights attached to any class of ordinary or preferred shares, or capitalize any debenture; or |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | issue any new shares or options (including warrants, options or other rights to acquire shares) which issuance would exceed 5% of our issued shares on a fully diluted basis. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

| C. | Material Contracts |
|----|--------------------|

| D. | Exchange Controls |
|----|-------------------|

----

----

| E. | Taxation |
|----|----------|

----

----

----

----

|   | · | an individual citizen or resident of the United States; |
|--------|--------|---------------------------------------------------------|

|   | · | a corporation (or other entity treated as a corporation) that is created or organized (or treated as created or organized) in or under the laws of the United States, any state thereof or the District of Columbia; or |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | an estate or trust whose income is includible in gross income for U.S. federal income tax purposes regardless of its source; or |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

|   | · | fails to provide an accurate taxpayer identification number; |
|--------|--------|--------------------------------------------------------------|

|   | · | is notified by the IRS that backup withholding is required; or |
|--------|--------|----------------------------------------------------------------|

|   | · | in certain circumstances, fails to comply with applicable certification requirements. |
|--------|--------|---------------------------------------------------------------------------------------|

| F. | Dividends and Paying Agents |
|----|-----------------------------|

----

| G. | Statement by Experts |
|----|----------------------|

| H. | Documents on Display |
|----|----------------------|

| I. | Subsidiary Information |
|----|------------------------|

----

----

| ITEM 13. | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES |
|---------------|-------------------------------------------------|

----

----

----

| ITEM 17. | FINANCIAL STATEMENTS |
|----------|----------------------|

| ITEM 18. | FINANCIAL STATEMENTS |
|----------|----------------------|

|   | (a) | Financial Statements of the Company |
|--------|-----|-------------------------------------|

|   | (b) | Financial Statements of Fujian Xing Gang Port Service Co., Ltd. |
|--------|-----|-----------------------------------------------------------------|

|   | (c) | Financial Statements of Chardan Acquisition Corp. |
|--------|-----|---------------------------------------------------|

----

| ITEM 19.  | EXHIBITS |
|----------------|----------|

| Exhibit No.  |   | Description                                                                                                                                                                                                                    |
|------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 1.1 (1)                |   | Amended and Restated Memorandum of Association of China Dredging Group Co., Ltd.                                                                                                                                               |
| 1.2 (1)                |   | Articles of Association of China Dredging Group Co., Ltd.                                                                                                                                                                      |
| 2.1                    |   | Specimen Ordinary Share Certificate.                                                                                                                                                                                           |
| 4.1 (1)                |   | Employment Agreement of Xinrong Zhuo.                                                                                                                                                                                          |
| 4.2 (1)                |   | Employment Agreement of Bin Lin.                                                                                                                                                                                               |
| 4.3 (1)                |   | Employment Agreement of Fangjie Gu.                                                                                                                                                                                            |
| 4.4 (1)                |   | Agreement and Plan of Merger by and among Chardan Acquisition Corp., Shareholders of Chardan Acquisition Corp., China Dredging Group Co., Ltd. and Shareholders Of China Dredging Group Co., Ltd. dated October 27, 2010.      |
| 4.5 (1)                |   | Securities Purchase Agreement by and among China Dredging Group Co., Ltd. and the Purchasers Listed on Exhibit A thereto, dated October 29, 2010.                                                                              |
| 4.6 (1)                |   | Registration Rights Agreement dated October 29, 2010.                                                                                                                                                                          |
| 4.7 (1)                |   | Securities Escrow Agreement dated October 29, 2010.                                                                                                                                                                            |
| 4.8 (3)                |   | Contracted Management Agreement by and among Fujian WangGang Dredging Construction Co., Ltd., Wonder Dredging LLC and  Fujian Xing Gang Port Service Ltd., dated June 30, 2010.                                      |
| 4.9 (3)                |   | Equity Interest Pledge Agreement by and among Qing Lin, Panxing Zhuo, Fujian WangGang Dredging Construction Co., Ltd. and Wonder Dredging LLC, dated June 30, 2010.                                                            |
| 4.10 (3)               |   | Contract Relating to the Exclusive Purchase Right of Equity Interest by and among Fujian WangGang Dredging Construction Co., Ltd., Wonder Dredging LLC and  Fujian Xing Gang Port Service Ltd., dated June 30, 2010. |
| 4.11 (1)               |   | Power of Attorney by and among Qing Lin, Panxing Zhuo and Fujian WangGang Dredging Construction Co., Ltd., dated June 30, 2010.                                                                                                |
| 4.12 (1)               |   | Power of Attorney by and between Wonder Dredging LLC and Fujian WangGang Dredging Construction Co., Ltd., dated June 30, 2010.                                                                                                 |
| 4.13 (1)               |   | Engineering Boat Purchase and Sale Contract for Xinggangjun #3 by and between Yiyang Zhonghai Boats and Ships Limited Liability Company and Fujian Xing Gang Shipping Service Co., Ltd., January 13, 2008                      |
| 4.14 (1)               |   | “Hongtaihai” Engineering Boat Purchase and Sale Contract for Xinggangjun #66 by and between Taizhou Hongtaihai Port Engineering Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., March 23, 2008.         |
| 4.15 (1)               |   | Engineering Boat Purchase and Sale Contract for Xinggangjun #6 by and between Yiyang Zhonghai Boats and Ships Limited Liability Company and Fujian Xing Gang Shipping Service Co., Ltd., dated January 18, 2008.               |
| 4.16 (1)          |   | Engineering Boat Purchase and Sale Contract by and between Yiyang Zhonghai Boats and Ships Limited Liability Company and Fujian Xing Gang Shipping Service Co., Ltd., dated May 20, 2009.                                 |
| 4.17 (1)               |   | Crewmen Dispatch Contract for Xinggangjun #3 by and between Fujian Haiyi International Shipping Service Agency Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., April 21, 2008.                                      |
| 4.18 (1)               |   | Crewmen Dispatch Contract for Xinggangjun #66 by and between Fujian Haiyi International Shipping Service Agency Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., February 21, 2008.                                  |
| 4.19 (1)               |   | Crewmen Dispatch Contract for Xinggangjun #6 by and between Fujian Haiyi International Shipping Service Agency Co., Ltd. and Fujian Xinggang Shipping Service Co., Ltd., dated April 21, 2008.                                 |
| 4.20 (1)               |   | Ship Lease Contract for Hengshengjun #88 by and between Lianyungang Hengrong Shipping Service Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated January 8, 2008.                                                |
| 4.21 (1)               |   | Crewmen Assignment Agreement for Hengshengjun #88 by and between Lianyungang Hengrong Shipping Service Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated January 8, 2008.                                       |

----

| 4.22 (1) |   | Ship Lease Supplemental Agreement for Hengshengjun #88 by and between Lianyungang Hengrong Shipping Service Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated April 13, 2010.                           |
|----------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.23 (1) |   | Crewmen Assignment Supplemental Agreement for Hengshengjun #88 by and between Lianyungang Hengrong Shipping Service Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated May 21, 2010.                     |
| 4.24 (1) |   | Ship Lease Contract for Xinggangjun #9 by and between Fujian Lutong Highway Engineering Construction Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated May 20, 2008.                                    |
| 4.25 (1) |   | Crewmen Assignment Agreement for Xinggangjun #9 by and between Fujian Lutong Highway Engineering Construction Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated May 20, 2008.                           |
| 4.26 (1) |   | Ship Lease Supplemental Agreement Contract for Xinggangjun #9 by and between Fujian Lutong Highway Engineering Construction Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated April 11, 2010.           |
| 4.27 (1) |   | Crewmen Assignment Supplemental Agreement for Xinggangjun #9 by and between Fujian Lutong Highway Engineering Construction Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated May 21, 2010.              |
| 4.28 (1) |   | Ship Lease Contract for Liya #10 by and between Beihai Shunda Liya Shipping Service Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 14, 2010.                                                        |
| 4.29 (1) |   | Crewmen Assignment Agreement for Liya #10 by and between Beihai Shunda Liya Shipping Service Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 14, 2010.                                               |
| 4.30 (1) |   | Ship Leasing Contract for Honglinjun #9 by and between Zhejiang Honglin Ship Engineering Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 19, 2010.                                                   |
| 4.31 (1) |   | Crewmen Assignment Agreement for Honglinjun #9 by and between Zhejiang Honglin Ship Engineering Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 19, 2010.                                            |
| 4.32 (1) |   | Ship Lease Contract for Honglinjun #18 by and between Zhejiang Honglin Ship Engineering Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 18, 2010.                                                    |
| 4.33 (1) |   | Crewmen Assignment Agreement for Honglinjun #18 by and between Zhejiang Honglin Ship Engineering Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 18, 2010.                                           |
| 4.34 (1) |   | Ship Lease Contract for Xiechang #18 by and between Zhonghai Engineering Construction General Bureau Dalian Engineering Construction Bureau and Fujian Xing Gang Port Service Co., Ltd., dated June 24, 2010.          |
| 4.35 (1) |   | Crewmen Assignment Agreement for Xiechang #18 by and between Zhonghai Engineering Construction General Bureau Dalian Engineering Construction Bureau and Fujian Xing Gang Port Service Co., Ltd., dated June 24, 2010. |
| 4.36 (1) |   | Office Lease Agreement by and between LIN Ping and Fujian Xing Gang Shipping Service Co., Ltd., dated January 1, 2008.                                                                                                 |
| 4.37 (1) |   | Office Lease Agreement by and between LIN Ping and Fujian Xing Gang Port Service Co., Ltd., dated January 1, 2010.                                                                                                     |
| 4.38 (1) |   | Office Lease Supplemental Agreement by and between LIN Ping and Fujian Xing Gang Port Service Co., Ltd., dated March 30, 2010.                                                                                         |
| 4.39 (2) |   | Employment Agreement by and between Fangjie Gu and Fujian Xing Gang Port Service Co., Ltd. dated January 24, 2011.                                                                                                     |
| 4.40 (2) |   | Supplemental Employment Agreement by and between Fangjie Gu and China Dredging Group Co., Ltd.                                                                                                                         |
| 4.41     |   | Employment Agreement of Alfred Ho.                                                                                                                                                                                     |
| 8.1 (1)  |   | List of Subsidiaries.                                                                                                                                                                                                  |
| 12.1     |   | Certification of Principal Executive Officer required by Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                   |
| 12.2     |   | Certification of Principal Financial Officer required by Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                   |

----

| 13.1 |   | Certification of Principal Executive Officer pursuant to 18 U.S.C., Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|
| 13.2 |   | Certification of Principal Financial Officer pursuant to 18 U.S.C., Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
| 15.1 |   | Letter from Webb & Company                                                                                                                          |

----

| CHINA DREDGING GROUP CO., LTD. |
|--------------------------------|
|                           |
| By:                            | /s/ Xinrong Zhuo |   |
|                           |   |
| Name: Xinrong Zhuo             |   |
| Title: Chief Executive Officer |   |
| Date: December 15, 2011        |   |

----

| China Dredging Group Co., Ltd and Subsidiaries                                                                                                                                                                                                                              | PAGE |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------|
| Report of Independent Registered Public Accounting Firm                                                                                                                                                                                                                     | F-1  |
| Consolidated Balance Sheets of China Dredging Group Co., Ltd and Subsidiaries at December 31, 2010 and December 31, 2009                                                                                                                                                    | F-2  |
| Consolidated Statements of Income of China Dredging Group Co., Ltd and Subsidiaries for the years ended December 31, 2010 and 2009 and for the period from January 8, 2008 (Date of Inception) to December 31, 2008                                                         | F-3  |
| Consolidated Statements of Changes in Shareholders’ Equity and Comprehensive Income of China Dredging Group Co., Ltd and Subsidiaries for the years ended December 31, 2010 and 2009 and for the period from January 8, 2008 (Date of Inception) to December 31, 2008 | F-4  |
| Consolidated Statements of Cash Flows of China Dredging Group Co., Ltd and Subsidiaries for the years ended December 31, 2010 and 2009 and for the period from January 8, 2008 (Date of Inception) to December 31, 2008                                                     | F-6  |
| Notes to Consolidated Financial Statements of China Dredging Group Co., Ltd and Subsidiaries for the years ended December 31, 2010 and 2009 and for the period from January 8, 2008 (Date of Inception) to December 31, 2008                                                | F-7  |

| Fujian Xing Gang Port Services Co., Ltd.                                                                                                                                                     | PAGE |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------|
| Report of Independent Registered Public Accounting Firm                                                                                                                                      | F-43 |
| Balance Sheets of Fujian Xing Gang Port Services Co., Ltd.at December 31, 2009 and 2008                                                                                                      | F-44 |
| Statements of Income of Fujian Xing Gang Port Services Co., Ltd.for the year ended December 31, 2009 and from January 8, 2008 (Inception) to December 31, 2008                          | F-45 |
| Statement of Changes in Owners’ Equity of Fujian Xing Gang Port Services Co., Ltd. for the year ended December 31, 2009 and from January 8, 2008 (Inception) to December 31, 2008 | F-46 |
| Statements of Cash Flows of Fujian Xing Gang Port Services Co., Ltd.for the year ended December 31, 2009 and from January 8, 2008 (Inception) to December 31, 2008                      | F-47 |
| Notes to the Financial Statements of Fujian Xing Gang Port Services Co., Ltd.for the year ended December 31, 2009 and from January 8, 2008 (Inception) to December 31, 2008             | F-48 |

| Chardan Acquisition Corp.                                                                                                                                                              | PAGE |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------|
| Index to Condensed Financial Statements of Chardan Acquisition Corp. (A development stage company) as of and for the periods ended June 30, 2010 (Unaudited) and September 30, 2009    | F-62 |
| Index to Condensed Financial Statements of Chardan Acquisition Corp. (A development stage company) as of and for the periods ended January 31, 2010 and September 30, 2009             | F-70 |
| Index to Condensed Financial Statements of Chardan Acquisition Corp. (A development stage company) as of and for the periods ended September 30, 2010 (Unaudited) and January 31, 2010 | F-80 |

----

----

|                                                                                                                                                                                                                                                               |   | December 31,      |        |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------|-------------|
|                                                                                                                                                                                                                                                               |   | 2010(as restated) |        |   | 2009 |   |
| Assets                                                                                                                                                                                                                                                             |   |                   |        |   |   |   |
| Current assets                                                                                                                                                                                                                                                     |   |                   |        |   |   |   |
| Cash                                                                                                                                                                                                                                                               |   | $                      | 88,532,472  |   |   | $ | 23,343,469 |   |
| Accounts receivable, net                                                                                                                                                                                                                                           |   |                   | 12,841,108  |   |   |   | — |   |
| Cost and estimated earnings in excess of billings on contracts in progress                                                                                                                                                                                         |   |                   | 834,909     |   |   |   | 2,211,411 |   |
| Inventories                                                                                                                                                                                                                                                        |   |                   | 202,213     |   |   |   | 429,226 |   |
| Other receivables                                                                                                                                                                                                                                                  |   |                   | 1,246       |   |   |   | 312 |   |
| Total current assets                                                                                                                                                                                                                                               |   |                   | 102,411,948 |   |   |   | 25,984,418 |   |
| Other assets                                                                                                                                                                                                                                                       |   |                   |        |   |   |   |   |   |
| Prepaid dredger deposits                                                                                                                                                                                                                                           |   |                   | 14,764,074  |   |   |   | 2,197,158 |   |
| Security deposits                                                                                                                                                                                                                                                  |   |                   | 21,454,545  |   |   |   | 8,422,440 |   |
| Property, plant and equipment, net                                                                                                                                                                                                                                 |   |                   | 40,604,784  |   |   |   | 43,511,237 |   |
| Total other assets                                                                                                                                                                                                                                                 |   |                   | 76,823,403  |   |   |   | 54,130,835 |   |
| Total assets                                                                                                                                                                                                                                                       |   | $                      | 179,235,351 |   |   | $ | 80,115,253 |   |
| Liabilities and equity                                                                                                                                                                                                                                             |   |                   |        |   |   |   |   |   |
| Liabilities                                                                                                                                                                                                                                                        |   |                   |        |   |   |   |   |   |
| Current liabilities                                                                                                                                                                                                                                                |   |                   |        |   |   |   |   |   |
| Term loans                                                                                                                                                                                                                                                         |   | $                      | —     |   |   | $ | 7,030,906 |   |
| Accounts payable                                                                                                                                                                                                                                                   |   |                   | 4,487,373   |   |   |   | — |   |
| Income tax payable                                                                                                                                                                                                                                                 |   |                   | 4,833,193   |   |   |   | 2,042,047 |   |
| Accrued liabilities and other payables                                                                                                                                                                                                                             |   |                   | 2,589,510   |   |   |   | 209,680 |   |
| Total current liabilities                                                                                                                                                                                                                                          |   |                   | 11,910,076  |   |   |   | 9,282,633 |   |
| Non-current liabilities                                                                                                                                                                                                                                            |   |                   |        |   |   |   |   |   |
| Term loan, net of current portion                                                                                                                                                                                                                                  |   |                   | —     |   |   |   | 3,295,738 |   |
| Contingent liability for a variable number of shares                                                                                                                                                                                                               |   |                   | 14,101,247  |   |   |   | — |   |
| Derivative liability                                                                                                                                                                                                                                               |   |                   | 1,517,748   |   |   |   | — |   |
| Total non-current liabilities                                                                                                                                                                                                                                      |   |                   | 15,618,995  |   |   |   | 3,295,738 |   |
| Total liabilities                                                                                                                                                                                                                                                  |   |                   | 27,529,071  |   |   |   | 12,578,371 |   |
| Class A Preferred Shares, no par value; 25,000,000 shares authorized; 10,012,987 shares issued and outstanding (liquidation preference $50,064,935, less $12,712,615 discount) as of December 31, 2010 and 0 shares issued and outstanding as of December 31, 2009 |   |                   | 43,929,923  |   |   |   | — |   |
| Shareholders’ equity                                                                                                                                                                                                                                         |   |                   |        |   |   |   |   |   |
| Ordinary shares, 225,000,000 shares authorized with no par value; 52,677,323 shares issued and outstanding as of December 31, 2010 and 52,177,323 issued and outstanding as of December 31, 2009                                                                   |   |                   | —     |   |   |   | — |   |
| Statutory reserves                                                                                                                                                                                                                                                 |   |                   | 10,295,279  |   |   |   | 4,888,018 |   |
| Additional paid-in capital                                                                                                                                                                                                                                         |   |                   | 79.185,284  |   |   |   | 29,002,371 |   |
| Retained earnings                                                                                                                                                                                                                                                  |   |                   | 13,392,884  |   |   |   | 43,946,972 |   |
| Accumulated other comprehensive income                                                                                                                                                                                                                             |   |                   | 4,902,910   |   |   |   | 682,256 |   |
| Subscription receivable                                                                                                                                                                                                                                            |   |                   | —     |   |   |   | (10,982,735 | ) |
| Total shareholders’ equity                                                                                                                                                                                                                                   |   |                   | 107,776,357 |   |   |   | 67,536,882 |   |
| Total liabilities and equity                                                                                                                                                                                                                                       |   | $                      | 179,235,351 |   |   | $ | 80,115,253 |   |

----

|                                                                                                                                                                                                                           |   | For the Years EndedDecember 31, |        |   | For the period fromJanuary 8, 2008(Inception) toDecember 31, |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------|-------------|--------|-------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                                                                           |   | 2010 (as restated)                        |        |   | 2009                                                                                            |   |   | 2008 |   |
| Contract revenue                                                                                                                                                                                                               |   | $                                                   | 131,405,665 |   |                                                                                            | $      | 80,333,891 |   |   | $ | 54,480,271 |   |
| Cost of contract revenue, includes depreciation of $5,037,318, $4,951,518 and $3,686,503 for the years ended December 31, 2010 and 2009 and for the period from January 8, 2008 (Inception) to December 31, 2008, respectively |   |                                                | (58,723,528 | )      |                                                                                            |   | (38,715,490 | ) |   |   | (25,424,227 | ) |
| Gross profit                                                                                                                                                                                                                   |   |                                                | 72,682,137  |   |                                                                                            |   | 41,618,401 |   |   |   | 29,056,044 |   |
| General and administrative expenses                                                                                                                                                                                            |   |                                                | (7,159,793  | )      |                                                                                            |   | (2,531,132 | ) |   |   | (2,152,575 | ) |
| Income from operations                                                                                                                                                                                                         |   |                                                | 65,522,344  |   |                                                                                            |   | 39,087,269 |   |   |   | 26,903,469 |   |
| Other income (expense):                                                                                                                                                                                                        |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| Interest income                                                                                                                                                                                                                |   |                                                | 123,536     |   |                                                                                            |   | 29,833 |   |   |   | 43,172 |   |
| Loss on derivative                                                                                                                                                                                                             |   |                                                | (11,298     | )      |                                                                                            |   | - |   |   |   | - |   |
| Interest expenses                                                                                                                                                                                                              |   |                                                | (843,995    | )      |                                                                                            |   | (755,853 | ) |   |   | (179,504 | ) |
| Sundry income                                                                                                                                                                                                                  |   |                                                | 89          |   |                                                                                            |   | — |   |   |   | — |   |
| Total other income (expense)                                                                                                                                                                                                   |   |                                                | (731,668    | )      |                                                                                            |   | (726,020 | ) |   |   | (136,332 | ) |
| Income before income taxes                                                                                                                                                                                                     |   |                                                | 64,790,676  |   |                                                                                            |   | 38,361,249 |   |   |   | 26,767,137 |   |
| Income tax expense                                                                                                                                                                                                             |   |                                                | (16,556,396 | )      |                                                                                            |   | (9,596,651 | ) |   |   | (6,696,745 | ) |
| Net income                                                                                                                                                                                                                     |   |                                                | 48,234,280  |   |                                                                                            |   | 28,764,598 |   |   |   | 20,070,392 |   |
| Accretion of discount on Class A Preferred Shares                                                                                                                                                                              |   |                                                | (22,293,720 | )      |                                                                                            |   | — |   |   |   | — |   |
| Net income attributable to ordinary shareholders                                                                                                                                                                               |   | $                                                   | 25,940,560  |   |                                                                                            | $      | 28,764,598 |   |   | $ | 20,070,392 |   |
| Earnings per ordinary share                                                                                                                                                                                                    |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| - Basic                                                                                                                                                                                                                        |   | $                                                   | 0.50        |   |                                                                                            | $      | 0.55 |   |   | $ | 0.38 |   |
| - Diluted                                                                                                                                                                                                                      |   | $                                                   | 0.50        |   |                                                                                            | $      | 0.55 |   |   | $ | 0.38 |   |
| Weighted average number of ordinary shares outstanding                                                                                                                                                                         |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| - Basic                                                                                                                                                                                                                        |   |                                                | 52,264,994  |   |                                                                                            |   | 52,177,323 |   |   |   | 52,177,323 |   |
| - Diluted                                                                                                                                                                                                                      |   |                                                | 52,264,994  |   |                                                                                            |   | 52,177,323 |   |   |   | 52,177,323 |   |

----

|                         |   | Ordinary Shares,withno Par Value |                |   | StatutoryReserves |   |                | AdditionalPaid-inCapital |   |   | RetainedEarnings       |   |   |                   |       |   | AccumulatedOther       |   |                | TotalShareholders’ |   |   | TotalComprehensive                 |   |
|-----------------------------------|--------|-------------------------------------------------|---------------------|--------|-------------------|--------|---------------------|--------------------------|--------|--------|------------------------|--------|--------|------------------------|------------|--------|------------------------|--------|---------------------|--------------------------|--------|--------|------------------------------------|--------|
|                              |   | Number of Shares                      |                |   | Amount            |   |                | (2010 asrestated)   |   |   | (2010 asrestated) |   |   | (2010 asrestated) |       |   | SubscriptionReceivable |   |                | ComprehensiveIncome      |   |   | Equity (2010as restated) |   |   | Income (2010as restated) |   |
| Balance as ofJanuary 8, 2008      |   |                                            | —             |   |              | $      | —             |                     |   | $      | —                |   |   | $                      | —    |   |                   | $      | —             |                     |   | $      | —                            |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |
| Capital contributed by owners     |   |                                            | —             |   |              |   | —             |                     |   |   | —                |   |   |                   | 8,501,266  |   |                   |   | —             |                     |   |   | —                            |   |   |   | — |   |   |   | 8,501,266 |   |   |   | — |   |
| Recapitalization                  |   |                                            | 52,177,323          |   |              |   | —             |                     |   |   | —                |   |   |                   | —    |   |                   |   | —             |                     |   |   | —                            |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Net income                        |   |                                            | —             |   |              |   | —             |                     |   |   | —                |   |   |                   | —    |   |                   |   | 20,070,392          |                     |   |   | —                            |   |   |   | — |   |   |   | 20,070,392 |   |   |   | 20,070,392 |   |
| Transfer to statutory reserves    |   |                                            | —             |   |              |   | —             |                     |   |   | 2,009,023              |   |   |                   | —    |   |                   |   | (2,009,023          | )                        |   |   | —                            |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Foreign currency translation gain |   |                                            |  —  |   |              |   |  —  |                     |   |   |  —     |   |   |                   | —    |   |                   |   |  —  |                     |   |   |  —                      |   |   |   | 685,244 |   |   |   | 685,244 |   |   |   | 685,244 |   |
| Balance as of December 31, 2008   |   |                                            | 52,177,323          |   |              | $      | —             |                     |   | $      | 2,009,023              |   |   | $                      | 8,501,266  |   |                   | $      | 18,061,369          |                     |   | $      | —                            |   |   | $ | 685,244 |   |   | $ | 29,256,902 |   |   | $ | 20,755,636 |   |
| Capital contributed by owners     |   |                                            | —             |   |              |   | —             |                     |   |   | —                |   |   |                   | 20,501,105 |   |                   |   | —             |                     |   |   | —                            |   |   |   | — |   |   |   | 20,501,105 |   |   |   | — |   |
| Subscription receivable           |   |                                            | —             |   |              |   | —             |                     |   |   | —                |   |   |                   | —    |   |                   |   | —             |                     |   |   | (10,982,735                        | )      |   |   | — |   |   |   | (10,982,735 | ) |   |   | — |   |
| Net income                        |   |                                            | —             |   |              |   | —             |                     |   |   | —                |   |   |                   | —    |   |                   |   | 28,764,598          |                     |   |   | —                            |   |   |   | — |   |   |   | 28,764,598 |   |   |   | 28,764,598 |   |
| Transfer to statutory reserves    |   |                                            | —             |   |              |   | —             |                     |   |   | 2,878,995              |   |   |                   | —    |   |                   |   | (2,878,995          | )                        |   |   | —                            |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Foreign currency translation gain |   |                                            |  —  |   |              |   |  —  |                     |   |   |  —     |   |   |                   | —    |   |                   |   |  —  |                     |   |   |  —                      |   |   |   | (2,988 | ) |   |   | (2,988 | ) |   |   | (2,988 | ) |
| Balance as of December 31, 2009   |   |                                            | 52,177,323          |   |              | $      | —             |                     |   | $      | 4,888,018              |   |   | $                      | 29,002,371 |   |                   | $      | 43,946,972          |                     |   | $      | (10,982,735                        | )      |   | $ | 682,256 |   |   | $ | 67,536,882 |   |   | $ | 28,761,610 |   |
| Shares issued:                    |   |                                            |                |   |              |   |                |                     |   |   |                   |   |   |                   |       |   |                   |   |                |                     |   |   |                               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| October 27, 2010 (reverse merger) |   |                                            | 500,000             |   |              |   | —             |                     |   |   | —                |   |   |                   | —    |   |                   |   | —             |                     |   |   | —                            |   |   |   | — |   |   |   | — |   |   |   | — |   |

----

|                                                                                                                                                                                                                                      |   | Ordinary Shares,withno Par Value |       |   |   |   |    | Additional        |   |   |           |   |   |             |       |   | Accumulatedother       |   |        | Total               |   |   | Total                     |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------|------------|--------|--------|--------|---------|-------------------|--------|--------|----------------|--------|--------|------------------|------------|--------|------------------------|--------|-------------|---------------------|--------|--------|---------------------------|--------|
|                                                                                                                                                                                                                                      |   | Number of Shares                      |       |   | Amount |   |    | Statutoryreserves |   |   | paid-incapital |   |   | Retainedearnings |       |   | Subscriptionreceivable |   |        | comprehensiveincome |   |   | shareholders’equity |   |   | comprehensiveincome |   |
| Contribution of dividends from Wonder Dredging’s shareholders generated by Fujian Service through March 31, 2010. Applied first as payment of subscription receivable, netted of the registered capital of Fujian Service of $29,002,371 |   |                                            | —    |   |   |   | — |              |   |   | —        |   |   |             | 22,085,016 |   |                   |   | —     |                |   |   | —                   |   |   |   | — |   |   |   | 22,085,016 |   |   |   | — |   |
| Contribution of shareholders’ loans and  net assets into statutory reserves and equity upon acquisition of interest in Wonder Dredging                                                                                         |   |                                            | —    |   |   |   | — |              |   |   | —        |   |   |             | 18,019,636 |   |                   |   | —     |                |   |   | —                   |   |   |   | — |   |   |   | 18,019,636 |   |   |   | — |   |
| Capital contributed in Wonder Dredging                                                                                                                                                                                                         |   |                                            | —    |   |   |   | — |              |   |   | —        |   |   |             | 878,876    |   |                   |   | —     |                |   |   | —                   |   |   |   | — |   |   |   | 878,876 |   |   |   | — |   |
| Subscription receivable                                                                                                                                                                                                                        |   |                                            | —    |   |   |   | — |              |   |   | —        |   |   |             | —    |   |                   |   | —     |                |   |   | 10,982,735                |   |   |   | — |   |   |   | 10,982,735 |   |   |   | — |   |
| Net income                                                                                                                                                                                                                                     |   |                                            | —    |   |   |   | — |              |   |   | —        |   |   |             | —    |   |                   |   | 48,234,280  |                |   |   | —                   |   |   |   | — |   |   |   | 48,234,280 |   |   |   | 48,234,280 |   |
| Transfer to statutory reserves                                                                                                                                                                                                                 |   |                                            | —    |   |   |   | — |              |   |   | 5,407,261      |   |   |             | —    |   |                   |   | (5,407,261  | )                   |   |   | —                   |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Dividend – contributed back in a non-cash transaction (See above)                                                                                                                                                                        |   |                                            | —    |   |   |   | — |              |   |   | —        |   |   |             | —    |   |                   |   | (51,087,387 | )                   |   |   | —                   |   |   |   | — |   |   |   | (51,087,387 | ) |   |   | — |   |
| Allocation of Preferred Share proceeds to  beneficial conversion feature                                                                                                                                                             |   |                                            |       |   |   |   |    |              |   |   |           |   |   |             | 9,199,385  |   |                   |   |        |                |   |   |                      |   |   |   |   |   |   |   | 9,199,385 |   |   |   |   |   |
| Accretion of Class A Preferred Shares discount                                                                                                                                                                                                 |   |                                            | —    |   |   |   | — |              |   |   | —        |   |   |             | —    |   |                   |   | (22,293,720 | )                   |   |   | —                   |   |   |   | — |   |   |   | (22,293,720 | ) |   |   | — |   |
| Foreign currency translation gain                                                                                                                                                                                                              |   |                                            | —    |   |   |   | — |              |   |   | —        |   |   |             | —    |   |                   |   | —     |                |   |   | —                   |   |   |   | 4,220,654 |   |   |   | 4,220,654 |   |   |   | 4,220,654 |   |
| Balances as of December 31, 2010 (as restated)                                                                                                                                                                                                 |   |                                            | 52,677,323 |   |   | $      | — |              |   | $      | 10,295,279     |   |   | $                | 79,185,284 |   |                   | $      | 13,392,884  |                |   | $      | —                   |   |   | $ | 4,902,910 |   |   | $ | 107,776,357 |   |   | $ | 52,454,934 |   |

----

|                                                                         |   | For the Years EndedDecember 31, |        |   | For the period fromJanuary 8, 2008(Inception) toDecember 31, |   |
|-----------------------------------------------------------------------------------|--------|-----------------------------------------------------|-------------|--------|-------------------------------------------------------------------------------------------------|--------|
|                                                                         |   | 2010(as restated)                              |        |   | 2009                                                                                            |   |   | 2008 |   |
| Cash flows from operating activities:                                             |   |                                                |        |   |                                                                                            |   |   |   |   |
| Net income                                                                        |   | $                                                   | 48,234,280  |   |                                                                                            | $      | 28,764,598 |   |   | $ | 20,070,392 |   |
| Adjustments to reconcile net income to net cash provided by operating activities: |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| Depreciation of property, plant and equipment                                     |   |                                                | 5,038,074   |   |                                                                                            |   | 4,952,236 |   |   |   | 3,686,744 |   |
| Loss on derivative                                                                |   |                                                | 11,298      |   |                                                                                            |   | — |   |   |   | — |   |
| Changes in operating assets and liabilities:                                      |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| Accounts receivable, net                                                          |   |                                                | (12,536,435 | )      |                                                                                            |   | — |   |   |   | — |   |
| Cost and estimated earnings in excess of billings on contracts in progress        |   |                                                | 1,418,098   |   |                                                                                            |   | (2,210,343 | ) |   |   | — |   |
| Other receivables                                                                 |   |                                                | (905        | )      |                                                                                            |   | (311 | ) |   |   | — |   |
| Inventories                                                                       |   |                                                | 236,039     |   |                                                                                            |   | (429,018 | ) |   |   | — |   |
| Accounts payable                                                                  |   |                                                | 4,380,904   |   |                                                                                            |   | — |   |   |   | — |   |
| Income tax payable                                                                |   |                                                | 2,656,355   |   |                                                                                            |   | (179,402 | ) |   |   | 2,186,909 |   |
| Accrued liabilities and other payables                                            |   |                                                | 2,320,868   |   |                                                                                            |   | 55,179 |   |   |   | 152,067 |   |
| Net cash provided by operating activities                                         |   |                                                | 51,758,576  |   |                                                                                            |   | 30,952,939 |   |   |   | 26,096,112 |   |
| Cash flows from investing activities:                                             |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| Deposits paid for dredgers                                                        |   |                                                | (12,194,972 | )      |                                                                                            |   | (2,196,096 | ) |   |   | — |   |
| Changes in security deposits                                                      |   |                                                | (12,440,092 | )      |                                                                                            |   | — |   |   |   | (8,291,156 | ) |
| Purchase of property, plant and equipment                                         |   |                                                | (329,951    | )      |                                                                                            |   | — |   |   |   | (33,768,198 | ) |
| Net cash used in investing activities                                             |   |                                                | (24,965,015 | )      |                                                                                            |   | (2,196,096 | ) |   |   | (42,059,354 | ) |
| Cash flows from financing activities:                                             |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| Repayment of term loans                                                           |   |                                                | (21,818,236 | )      |                                                                                            |   | (1,830,080 | ) |   |   | — |   |
| Proceeds from term loans                                                          |   |                                                | 11,389,859  |   |                                                                                            |   | 3,367,348 |   |   |   | 8,651,641 |   |
| Payment of dredger payable                                                        |   |                                                | —     |   |                                                                                            |   | (17,838,704 | ) |   |   | — |   |
| Proceeds from share issue                                                         |   |                                                | 46,443,286  |   |                                                                                            |   | — |   |   |   | — |   |
| Capital contributions from capital issue to Wonder Dredging/Fujian Service        |   |                                                | 878,876     |   |                                                                                            |   | 9,516,419 |   |   |   | 8,651,641 |   |
| Net cash provided by/(used in) financing activities                               |   |                                                | 36,893,785  |   |                                                                                            |   | (6,785,017 | ) |   |   | 17,303,282 |   |
| Net increase in cash                                                              |   |                                                | 63,687,346  |   |                                                                                            |   | 21,971,826 |   |   |   | 1,340,040 |   |
| Effect of exchange rate changes on cash                                           |   |                                                | 1,501,657   |   |                                                                                            |   | 9,501 |   |   |   | 22,102 |   |
| Cash at beginning of year/period                                                  |   |                                                | 23,343,469  |   |                                                                                            |   | 1,362,142 |   |   |   | — |   |
| Cash at end of year/period                                                        |   | $                                                   | 88,532,472  |   |                                                                                            | $      | 23,343,469 |   |   | $ | 1,362,142 |   |
| Supplemental disclosures of cash flow information                                 |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| Cash paid:                                                                        |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| Interest paid                                                                     |   | $                                                   | 871,794     |   |                                                                                            | $      | 753,776 |   |   | $ | 154,451 |   |
| Income tax paid                                                                   |   | $                                                   | 13,900,042  |   |                                                                                            | $      | 9,776,053 |   |   | $ | 4,509,836 |   |
| Supplemental disclosures of non-cash transactions:                                |   |                                                |        |   |                                                                                            |   |   |   |   |   |   |   |
| Accretion of discount on Class A Preferred Shares                                 |   | $                                                   | 22,293,720  |   |                                                                                            | $      | — |   |   | $ | — |   |
| Purchases of property, plant and equipment with issuance of debt                  |   | $                                                   | —     |   |                                                                                            | $      | — |   |   | $ | 17,569,133 |   |

----

| Name                                   |   | No. ofordinary shares |       |   | %      |   |
|----------------------------------------|--------|---------------------------------|------------|--------|--------|--------|
| Mars Harvest Co., Ltd.                 |   |                            | 33,852,703 |   |   |   | 64.26 | % |
| Venus Seed Co., Ltd.                   |   |                            | 2,608,866  |   |   |   | 4.95 | % |
| Saturn Glory Co., Ltd.                 |   |                            | 2,608,866  |   |   |   | 4.95 | % |
| Country Vitality Enterprises Limited   |   |                            | 2,600,000  |   |   |   | 4.94 | % |
| Windham Investments Limited            |   |                            | 2,580,000  |   |   |   | 4.90 | % |
| Partner One Holdings Limited           |   |                            | 2,550,000  |   |   |   | 4.84 | % |
| NewMargin Growth Fund, L.P.            |   |                            | 1,600,000  |   |   |   | 3.04 | % |
| Cadman Investments Ltd.                |   |                            | 1,593,555  |   |   |   | 3.03 | % |
| Linkstate Global Investment Limited    |   |                            | 600,000    |   |   |   | 1.14 | % |
| NewMargin Partners Ltd.                |   |                            | 400,000    |   |   |   | 0.76 | % |
| Regent Fill Investment Group Limited   |   |                            | 325,000    |   |   |   | 0.62 | % |
| Poying Holdings Limited                |   |                            | 325,000    |   |   |   | 0.62 | % |
| Nan Ding                               |   |                            | 270,833    |   |   |   | 0.51 | % |
| Jianliang Yu                           |   |                            | 162,500    |   |   |   | 0.31 | % |
| Gala Fortune Limited                   |   |                            | 135,000    |   |   |   | 0.25 | % |
| Steven A. Urbach                       |   |                            | 128,515    |   |   |   | 0.24 | % |
| Fresh Reward Development Limited       |   |                            | 100,000    |   |   |   | 0.19 | % |
| Delaware Charter FBO Kerry Propper IRA |   |                            | 91,755     |   |   |   | 0.17 | % |
| Chardan Capital Markets, LLC           |   |                            | 74,620     |   |   |   | 0.14 | % |
| Kerry Propper                          |   |                            | 36,760     |   |   |   | 0.07 | % |
| George B. Kaufman                      |   |                            | 15,000     |   |   |   | 0.03 | % |
| WHI, Inc. Retirement Savings Plan      |   |                            | 15,000     |   |   |   | 0.03 | % |
| Todd A. Gold                           |   |                            | 3,350      |   |   |   | 0.01 | % |
|                                   |   |                            | 52,677,323 |   |   |   | 100 | % |

----

| 1) | Management Agreement — Fujian WangGang has the exclusive right to manage, operate and control the business operations of Fujian Service, including, but not limited to, establishing and implementing policies for management, using all of the assets of Fujian Service, appointing Fujian Service’s directors and senior management, directing Fujian Service to enter into loan agreement, making administrative decisions regarding employee wages or hiring and firing employees and other actions customarily associated with Fujian Service’s senior management.  As consideration for its business management services, Fujian WangGang has agreed to pay to Fujian Service an annual fee of approximately $149,000 (RMB1 million), and Fujian Service will pay to Fujian WangGang 100% of the net profits of Fujian Service.  The Management Agreement terminates upon the earlier of (i) Fujian WangGang’s exercise in full of the option to purchase the equity interests of Fujian Service, pursuant to the Exclusive Option Agreement, and Fujian WangGang and/or its designees individually or jointly own all of the equity interests in Fujian Service, or (ii) June 30, 2030, subject to the right of Fujian WangGang to renew the term of the Management Agreement for additional consecutive 20-year periods. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 2) | Exclusive Option Agreement — Fujian WangGang has the exclusive right to purchase up to all of the equity interest in Fujian Service that is held by Wonder Dredging, to the extent allowed under the current PRC law.  Accordingly, if and when the current limitations on direct ownership of Fujian Service by Fujian WangGang are eased or ceased, Fujian WangGang may exercise its option to purchase and directly own the equity interests of Fujian Service.  The purchase price for the equity interest in Fujian Service held by Wonder Dredging would be equivalent to the net asset value reflected in Fujian Service’s then current quarterly report prepared according to U.S. GAAP.  The term of the Exclusive Option Agreement is 20 years, which term continuously renews unless the option is exercised in full or the agreement is otherwise terminated by the parties.  The agreement also provides that upon consummation of the exercise of the option, Wonder Dredging will contribute, without additional consideration, any funds actually received by it from Fujian WangGang for the transfer of its equity interest in Fujian Service to Fujian WangGang.  The agreement further provides that, as of the date of the agreement, Fujian WangGang is entitled to all the future payments by Fujian Service to Wonder Dredging, together with all the profits of Fujian Service. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3) | Equity Interest Pledge Agreement — To ensure that Fujian Service and its shareholders perform their obligations under the Exclusive Option Agreement, the Management Agreement, and a letter of undertaking whereby Wonder Dredging waived its right to receive a dividend of approximately $51.1 million declared by Fujian Service in May 2010, the owners of 100% of the equity interests in Fujian Service, pledged their entire interest in Wonder Dredging to Fujian WangGang.  The Equity Interest Pledge Agreement terminates upon the earlier of (i) the purchase of the entire equity interest in Fujian Service by Fujian WangGang or (ii) June 30, 2030, subject to the right of Fujian WangGang to renew the term of the Equity Interest Pledge Agreement for additional consecutive 20 year periods. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4) | Powers of Attorney — Wonder Dredging executed irrevocable power of attorney granting to Fujian WangGang or its designees the power to vote, pledge or dispose of all equity interests in Fujian Service that Wonder Dredging holds. Additionally, the powers of attorney allow Fujian WangGang or its designees to sign and carry out the intentions of the Management Agreement, the Equity Pledge Agreement and the Exclusive Option Agreement. At the same time, the owners of the equity interests in Wonder Dredging executed powers of attorney granting to Fujian WangGang or its designees the power to vote, pledge, or dispose of all equity interests in Wonder Dredging, and to appoint directors and senior management of Wonder Dredging. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 1) | There is no “equity investment at risk” as defined in ASC 810-10-15-14a.1 because no equity holders participate in profits as holders of the legal and accounting equity.  Fujian WangGang, in its capacity as holder of the Management Agreement has the right to a fee equal to 100% of profits.  With no equity investment at risk it cannot be said that the equity investment at risk is sufficient to finance the activities of Fujian Service.  Consequently, Fujian Service is defined as a VIE under ASC 810-10-15-14a. |
|--------|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | 2) | Even if management’s judgment concerning the lack of equity investment at risk were to be determined inappropriate and the legal equity interests did represent equity investment at risk, the equity investors as a group do not have the power to direct the activities of Fujian Service that most significantly affect its economic performance.  All such control rights rest with Fujian WangGang in its capacity as holder of the Management Agreement.  Consequently, Fujian Service would be defined as a VIE under ASC 810-10-15-14b.1. |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3) | Additionally, even if management’s judgment concerning the lack of equity investment at risk were to be determined inappropriate and the legal equity interests did represent equity investment at risk, the equity investors as a group do not have the right to receive the expected residual returns of Fujian Service.  Fujian WangGang in its capacity as holder of the Management Agreement has the right to a fee equal to 100% of profits leaving no residual returns of Fujian Service for the equity investors.  Consequently, Fujian Service would be defined as a VIE under ASC 810-10-15-14b.3. |
|--------|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| a) | Fujian WangGang has the power to direct the activities of Fujian Service that most significantly impact Fujian Service’s economic performance because the Management Agreement gives Fujian WangGang all power to control the activities of Fujian Service. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b) | Even if management’s judgment that the Management Agreement gives Fujian WangGang that power were determined to be incorrect, Fujian WangGang would still have that power through i) its 50% legal voting interest and ii) its sole right under the Powers of Attorney, to use the voting power of Wonder Dredging’s 50% voting interest. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| a) | Fujian WangGang has a direct 50% ownership interest in Fujian Service which has an obligation to absorb losses. |
|----|-----------------------------------------------------------------------------------------------------------------|

| b) | Fujian WangGang, in its capacity as holder of the Management Agreement has the right to 100% of the profits of Fujian Service. |
|----|--------------------------------------------------------------------------------------------------------------------------------|

| c) | Fujian WangGang through the Exclusive Option Agreement is the beneficial owner of Wonder Dredging’s 50% ownership interest in Fujian Service, which is an additional source of both the obligation to absorb losses and the right to receive benefits that could potentially be significant to Fujian Service. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 1) | There is no “equity investment at risk” as defined in ASC 810-10-15-14a.1 because no equity holders participate in profits or losses as holders of the legal equity interests.  Wonder Dredging’s only material asset is its 50% ownership interest in Fujian Service.  Fujian WangGang, in its capacity as holder of the Exclusive Option Agreement receives all benefits and absorbs all losses of that asset, and therefore of Wonder Dredging.  With no equity investment at risk it cannot be said that the equity investment at risk is sufficient to finance the activities of Wonder Dredging.  Consequently, Wonder Dredging is defined as a VIE under ASC 810-10-15-14a. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 2) | Even if management’s judgment concerning the lack of equity investment at risk were to be determined inappropriate and the legal equity interests did represent equity investment at risk, the equity investors as a group do not have the power to direct the activities of Wonder Dredging that most significantly affect its economic performance.  All such control rights rest with Fujian WangGang, under the Powers of Attorney.  Consequently, Wonder Dredging would be defined as a VIE under ASC 810-10-15-14b.1. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3) | Additionally, even if management’s judgment concerning the lack of equity investment at risk were to be determined inappropriate and the legal equity interests did represent equity investment at risk, the equity investors as a group do not have the right to receive the expected residual returns of Fujian Service.  Fujian WangGang in its capacity as holder of the Exclusive Option Agreement has the right to all profits and gains on the Wonder Dredging’s only material asset, the ownership interest in Fujian Service, leaving no residual returns of Wonder Dredging for the equity investors.  Consequently, Wonder Dredging would be defined as a VIE under ASC 810-10-15-14b.3. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 1) | Power to direct the activities of Wonder Dredging: |
|----|----------------------------------------------------|

|   | a) | Fujian WangGang has the power to direct the activities of Wonder Dredging that most significantly impact Wonder Dredging’s economic performance because the Powers of Attorney give Fujian WangGang all power to control the activities of Wonder Dredging. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | b) | Even if management’s judgment that the Powers of Attorney give Fujian WangGang that power were determined to be incorrect, Fujian WangGang would still have that power through its control of Wonder Dredging’s only significant activity, its ownership of a 50% interest in Fujian Service.  Such control is held by Fujian WangGang even without consideration of the Powers of Attorney through i) Wonder Dredging’s inability to transfer the ownership interest in Fujian Service because of the Exclusive Option Agreement and ii) Wonder Dredging’s inability to exercise control over Fujian Service because of Fujian WangGang’s right under the Management Agreement to appoint all Directors of Fujian Service. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2) | Obligation to absorb losses of Wonder Dredging or the right to receive benefits from Wonder Dredging.  In its capacity as holder of the Exclusive Option Agreement, Fujian WangGang receives all value of Wonder Dredging’s only material asset, its ownership interest in Fujian Service.  Consequently, Fujian WangGang absorbs all losses and receives all benefits of this sole material asset. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                                                                  |   | Wonder Dredging |    |   | Fujian Service |   |
|----------------------------------------------------------------------------|--------|----------------------|---------|--------|---------------------|--------|
| ASSETS                                                                     |   |                 |    |   |                |   |
| Cash and cash equivalents                                                  |   | $                    | 909,353 |   |                | $      | 60,555,411 |   |
| Accounts receivable, net                                                   |   |                 | — |   |                |   | 12,841,108 |   |
| Cost and estimated earnings in excess of billings on contracts in progress |   |                 | — |   |                |   | 834,909 |   |
| Other current assets                                                       |   |                 | — |   |                |   | 203,337 |   |
| Property, plant and equipment, net                                         |   |                 | — |   |                |   | 40,604,784 |   |
| Prepaid dredger deposits                                                   |   |                 | — |   |                |   | 14,764,074 |   |
| Security deposits                                                          |   |                 | — |   |                |   | 21,454,545 |   |
|                                                                       |   | $                    | 909,353 |   |                | $      | 151,258,168 |   |
| LIABILITIES                                                                |   |                 |    |   |                |   |   |   |
| Accounts payable                                                           |   | $                    | — |   |                | $      | 4,487,373 |   |
| Income tax payable                                                         |   |                 | — |   |                |   | 4,833,193 |   |
| Accrued liabilities and other payables                                     |   |                 | 5,911   |   |                |   | 2,398,015 |   |
|                                                                       |   | $                    | 5,911   |   |                | $      | 11,718,581 |   |

----

|                                     |   | Year EndedDecember 31, 2010 |    |
|-----------------------------------------------|--------|--------------------------------------------|---------|
|                                     |   | Wonder Dredging                       |    |   | FujianService |   |
| Contract revenue                              |   | $                                          | — |   |   | $ | 131,405,665 |   |
| Cost of contract revenue                      |   | $                                          | — |   |   | $ | (58,723,528 | ) |
| Net (loss)/income attributable to the Company |   | $                                          | (5,515  | ) |   | $ | 49,678,234 |   |

|                                           |   | Wonder Dredging |    |   | Fujian Service |   |
|-----------------------------------------------------|--------|----------------------|---------|--------|---------------------|--------|
| Net cash provided by operating activities           |   | $                    | 396     |   |                | $      | 52,999,859 |   |
| Net cash provided by/(used in) investing activities |   |                 | 878,876 |   |                |   | (30,305,428 | ) |
| Net cash provided by financing activities           |   |                 | — |   |                |   | 13,174,083 |   |
| Net increase in cash                                |   |                 | 879,272 |   |                |   | 35,868,514 |   |
| Effect on change of exchange rates                  |   |                 | 30,081  |   |                |   | 1,343,428 |   |
| Cash at the beginning of the year                   |   |                 | — |   |                |   | 23,343,469 |   |
| Cash at the end of the year                         |   | $                    | 909,353 |   |                | $      | 60,555,411 |   |

| Renminbi to one US dollar                                                         |   |   |   |
|-----------------------------------------------------------------------------------|--------|--------|--------|
| Rate as of December 31, 2010                                                      |   |   | 6.6000 |   |
| Average rate for the year ended December 31, 2010                                 |   |   | 6.7604 |   |
| Rate as of December 31, 2009                                                      |   |   | 6.8270 |   |
| Average rate for the year ended December 31, 2009                                 |   |   | 6.8303 |   |
| Average rate for the period from January 8, 2008 (Inception) to December 31, 2008 |   |   | 6.9351 |   |
| Hong Kong dollar to one US dollar                                                 |   |   |   |   |
| Rate as of December 31, 2010                                                      |   |   | 7.7810 |   |
| Average rate for the twelve months ended December 31, 2010                        |   |   | 7.7700 |   |

----

|             |   | Estimated lives |   |
|------------------|--------|----------------------|--------|
| Dredgers         |   |                 | 10     |   |
| Machinery        |   |                 | 5      |   |
| Office equipment |   |                 | 5      |   |

----

----

----

|  Net Income    |   | $      | 48,234,280 |   |
|---------------------|--------|--------|------------|--------|
| Add:                |   |   |       |   |
| Loss on derivative  |   |   | 11,298     |   |
|                |   |   |       |   |
| Adjusted Net Income |   | $      | 48,245,578 |   |

----

----

| Liability balance December 31, 2009              |   | $      | -          |   |
|--------------------------------------------------|--------|--------|------------|--------|
| Additional liabilities entered into – 2010 |   |   | 15,607,697 |   |
| Increase in liability fair value – 2010    |   |   | 11,298     |   |
| Liability balance – December 31, 2010      |   | $      | 15,618,995 |   |

----

----

----

|                            |   | 2010   |       |   | 2009   |   |
|---------------------------------|--------|--------|------------|--------|--------|--------|
| Hong Kong                       |   | $      | 21,566,194 |   |   | $      | — |   |
| The PRC                         |   |   | 66,966,278 |   |   |   | 23,343,469 |   |
|                       |   | $      | 88,532,472 |   |   | $      | 23,343,469 |   |
| Maximum exposure to credit risk |   | $      | 88,532,472 |   |   | $      | 23,343,469 |   |

----

|         |   | 2010   |       |   | 2009   |   |
|--------------|--------|--------|------------|--------|--------|--------|
| USD          |   | $      | 27,041,216 |   |   | $      | — |   |
| RMB          |   |   | 61,465,283 |   |   |   | 23,343,469 |   |
| HKD          |   |   | 25,973     |   |   |   | — |   |
|    |   | $      | 88,532,472 |   |   | $      | 23,343,469 |   |

| Name of contract |                                             | Estimated contractvalue |   |       | Total revenueRecognized in2010 |   |   | Amountreceived/billed |   |   | Accountsreceivable |       |   | Status of contract(Completion %) |   |
|----------------------------|--------------------------------------------------|------------------------------|--------|------------|-------------------------------------|--------|--------|-----------------------|--------|--------|--------------------|------------|--------|--------------------------------------------|--------|
| 1.                    | Zhuhai Gaolan Port Dredging III*                 |                         | $      | 1,686,291  |                                |   | $      | 522,002               |   |   | $                  | 522,002    |   |                                       | $      | — |   |   |   | 100 | % |
| 2.                    | Zhuhai Gaolan Port Dredging IV                   |                         |   | 2,107,863  |                                |   |   | 2,123,125             |   |   |               | 2,123,125  |   |                                       |   | — |   |   |   | 100 | % |
| 3.                    | Zhuhai Gaolan Port Dredging V                    |                         |   | 2,891,841  |                                |   |   | 3,022,060             |   |   |               | 3,022,060  |   |                                       |   | — |   |   |   | 100 | % |
| 4.                    | Zhuhai Gaolan Port Dredging VI                   |                         |   | 1,182,474  |                                |   |   | 1,199,883             |   |   |               | 1,199,883  |   |                                       |   | — |   |   |   | 100 | % |
| 5.                    | Oujiang Port Lantian Dredging II*                |                         |   | 7,188,924  |                                |   |   | 803,979               |   |   |               | 803,979    |   |                                       |   | — |   |   |   | 100 | % |
| 6.                    | Oujiang Port Lantian Dredging III                |                         |   | 4,233,477  |                                |   |   | 4,282,649             |   |   |               | 4,282,649  |   |                                       |   | — |   |   |   | 100 | % |
| 7.                    | Tangshan Caofeidian Dredging and Reclamation I*  |                         |   | 9,316,017  |                                |   |   | 3,269,800             |   |   |               | 3,269,800  |   |                                       |   | — |   |   |   | 100 | % |
| 8.                    | Tangshan Caofeidian Dredging and Reclamation II* |                         |   | 11,123,602 |                                |   |   | 3,723,230             |   |   |               | 3,723,230  |   |                                       |   | — |   |   |   | 100 | % |
| 9.               | Tangshan Caofeidian Dredging and Reclamation III |                         |   | 10,106,207 |                                |   |   | 10,138,730            |   |   |               | 10,138,730 |   |                                       |   | — |   |   |   | 100 | % |
| 10.                   | Tangshan Caofeidian Dredging and Reclamation IV  |                         |   | 8,907,165  |                                |   |   | 8,921,169             |   |   |               | 8,921,169  |   |                                       |   | — |   |   |   | 100 | % |

----

| 11.  | Tangshan Caofeidian Dredging and Reclamation V    |   |   | 7,965,061  |   |   |   | 8,000,862  |   |   |   | 8,000,862  |   |   |   | —   |   |   |   | 100 | % |
|-----------|---------------------------------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|-----------|--------|--------|--------|-----|---|
| 12.       | Tangshan Caofeidian Dredging and Reclamation VI   |   |   | 1,199,041  |   |   |   | 1,265,383  |   |   |   | 1,265,383  |   |   |   | —   |   |   |   | 100 | % |
| 13.  | Tangshan Caofeidian Dredging and Reclamation VII  |   |   | 1,370,333  |   |   |   | 1,406,454  |   |   |   | 1,406,454  |   |   |   | —   |   |   |   | 100 | % |
| 14.  | Tangshan Caofeidian Dredging and Reclamation VIII |   |   | 1,370,333  |   |   |   | 1,385,751  |   |   |   | 1,385,751  |   |   |   | —   |   |   |   | 100 | % |
| 15.  | Tangshan Caofeidian Dredging and Reclamation IX   |   |   | 1,884,208  |   |   |   | 1,961,333  |   |   |   | 1,370,836  |   |   |   | 590,497   |   |   |   | 100 | % |
| 16.  | Tangshan Caofeidian Dredging and Reclamation X    |   |   | 2,226,791  |   |   |   | 2,255,933  |   |   |   | 1,619,452  |   |   |   | 636,481   |   |   |   | 100 | % |
| 17.  | Tangshan Caofeidian Dredging and Reclamation XI   |   |   | 2,226,791  |   |   |   | 2,269,310  |   |   |   | 1,619,588  |   |   |   | 649,722   |   |   |   | 100 | % |
| 18.  | Qinzhou Port Channel Dredging I                   |   |   | 1,354,949  |   |   |   | 1,367,145  |   |   |   | 1,367,145  |   |   |   | —   |   |   |   | 100 | % |
| 19.  | Qinzhou Port Channel Dredging II                  |   |   | 3,240,489  |   |   |   | 3,278,074  |   |   |   | 2,356,958  |   |   |   | 921,116   |   |   |   | 100 | % |
| 20.  | Qinzhou Port Channel Dredging III                 |   |   | 2,864,180  |   |   |   | 2,930,412  |   |   |   | 1,203,453  |   |   |   | 1,726,959 |   |   |   | 100 | % |
| 21.  | Zhanjiang Steel Base Dredging and Reclamation I   |   |   | 13,706,290 |   |   |   | 13,766,653 |   |   |   | 13,766,653 |   |   |   | —   |   |   |   | 100 | % |
| 22.  | Zhanjiang Steel Base Dredging and Reclamation II  |   |   | 7,521,744  |   |   |   | 7,562,211  |   |   |   | 7,562,211  |   |   |   | —   |   |   |   | 100 | % |

----

| 23.  | Guohua Taidian Coal Port Dredging I                                        |   |   | 1,389,859   |   |   |   | 1,400,272   |   |   |   | 1,400,272   |   |   |   | —    |   |   |   | 100    | %      |
|-----------|----------------------------------------------------------------------------|--------|--------|-------------|--------|--------|--------|-------------|--------|--------|--------|-------------|--------|--------|--------|------------|--------|--------|--------|--------|--------|
| 24.  | Hainan Yangpu Port Dredging I                                              |   |   | 4,422,815   |   |   |   | 4,442,077   |   |   |   | 2,307,346   |   |   |   | 2,134,731  |   |   |   | 100    | %      |
| 25.  | Tianjin South Port Industrial Zone Dredging and  Reclamation I   |   |   | 6,427,075   |   |   |   | 6,439,226   |   |   |   | 6,439,226   |   |   |   | —    |   |   |   | 100    | %      |
| 26.  | Tianjin South Port Industrial Zone Dredging and  Reclamation II       |   |   | 2,591,563   |   |   |   | 2,594,554   |   |   |   | 2,594,554   |   |   |   | —    |   |   |   | 100    | %      |
| 27.  | Tianjin South Port Industrial Zone Dredging and  Reclamation III      |   |   | 4,804,449   |   |   |   | 4,886,953   |   |   |   | 1,770,347   |   |   |   | 3,116,606  |   |   |   | 100    | %      |
| 28.  | Jingtang Port Channel Dredging I                                           |   |   | 4,771,315   |   |   |   | 4,825,986   |   |   |   | 4,825,986   |   |   |   | —    |   |   |   | 100    | %      |
| 29.  | Jingtang Port Channel Dredging II                                          |   |   | 1,363,233   |   |   |   | 1,375,678   |   |   |   | 1,375,678   |   |   |   | —    |   |   |   | 100    | %      |
| 30.  | Jingtang Port Channel Dredging III                                         |   |   | 1,704,041   |   |   |   | 1,718,233   |   |   |   | 1,718,233   |   |   |   | —    |   |   |   | 100    | %      |
| 31.       | Qingdao Port Channel Dredging I                                            |   |   | 5,773,623   |   |   |   | 5,775,020   |   |   |   | 5,775,020   |   |   |   | —    |   |   |   | 100    | %      |
| 32.       | Panjin Vessels Industrial Base Project I                                   |   |   | 10,720,963  |   |   |   | 10,739,467  |   |   |   | 7,674,471   |   |   |   | 3,064,996  |   |   |   | 100    | %      |
| 33.       | Tonggu Channel, Shenzhen West Port Public Dredging and  Reclamation I |   |   | 932,341     |   |   |   | 936,951     |   |   |   | 936,951     |   |   |   | —    |   |   |   | 100    | %      |
|      |                                                                  |   | $      | 150,575,348 |   |   | $      | 130,590,565 |   |   | $      | 117,749,457 |   |   | $      | 12,841,108 |   |   |   |   |   |

----

| Name of contract                      |   | Estimated contractvalue |      |   | Totalrevenue recognized |   |    | Amount received/billed |   |   | Cost and estimated earnings in excess of billings |   |   | Status of contract (Completion %) |    |
|-------------------------------------------------|--------|------------------------------|-----------|--------|------------------------------|--------|---------|-----------------------------|--------|--------|--------------------------------------------------------------------------------------|--------|--------|-------------------------------------------------------|---------|
| Yantian Port Channel Dredging and Reclamation I |   | $                            | 1,867,937 |   |                         | $      | 815,100 |                        |   | $      | —                                                                              |   |   | $                                                     | 834,909 |   |   |   | 44 | % |

| Name of contract |                                                            | Estimated contractvalue |   |       | Totalrevenue recognized |   |   | Amountreceived/billed |   |   | Cost and estimatedearnings in excess ofbillings |       |   | Status of contract(Completion%) |   |
|----------------------------|-----------------------------------------------------------------|------------------------------|--------|------------|------------------------------|--------|--------|-----------------------|--------|--------|--------------------------------------------------------------------------|------------|--------|-------------------------------------------|--------|
| 1.                    | Zhuhai Gaolan Port Dredging I                                   |                         | $      | 3,593,400  |                         |   | $      | 3,562,573             |   |   | $                                                                        | 3,562,573  |   |                                      | $      | — |   |   |   | 100 | % |
| 2.                    | Zhuhai Gaolan Port Dredging II                                  |                         |   | 4,160,871  |                         |   |   | 4,057,455             |   |   |                                                                     | 4,057,455  |   |                                      |   | — |   |   |   | 100 | % |
| 3.                    | Zhuhai Gaolan Port Dredging III                                 |                         |   | 1,669,034  |                         |   |   | 1,184,474             |   |   |                                                                     | 834,347    |   |                                      |   | 350,127 |   |   |   | 71 | % |
| 4.                    | Zhanjiang Industrial Centre Dredging and Reclamation I          |                         |   | 2,912,024  |                         |   |   | 2,839,336             |   |   |                                                                     | 2,839,336  |   |                                      |   | — |   |   |   | 100 | % |
| 5.               | Dalin Chandao Hulushan Dredging I                               |                         |   | 7,378,885  |                         |   |   | 7,332,395             |   |   |                                                                     | 7,332,395  |   |                                      |   | — |   |   |   | 100 | % |
| 6.               | Dalin Chandao Hulushan Dredging II                              |                         |   | 8,608,699  |                         |   |   | 8,623,406             |   |   |                                                                     | 8,623,406  |   |                                      |   | — |   |   |   | 100 | % |
| 7.               | Oujiang Port Lantian Dredging I                                 |                         |   | 7,589,711  |                         |   |   | 7,210,493             |   |   |                                                                     | 7,210,493  |   |                                      |   | — |   |   |   | 100 | % |
| 8.                    | Oujiang Port Lantian Dredging II                                |                         |   | 7,115,354  |                         |   |   | 6,336,300             |   |   |                                                                     | 5,691,971  |   |                                      |   | 644,329 |   |   |   | 89 | % |
| 9.                    | Taishan Tongguhai Zone Guohuatai Dianmei Port  Dredging I  |                         |   | 674,641    |                         |   |   | 674,469               |   |   |                                                                     | 674,469    |   |                                      |   | — |   |   |   | 100 | % |
| 10.                   | Taishan Tongguhai Zone Guohuatai Dianmei Port  Dredging II |                         |   | 3,513,755  |                         |   |   | 3,383,060             |   |   |                                                                     | 3,383,060  |   |                                      |   | — |   |   |   | 100 | % |
| 11.                   | Fangchengguang Steel Project I                                  |                         |   | 19,025,519 |                         |   |   | 18,357,311            |   |   |                                                                     | 18,357,311 |   |                                      |   | — |   |   |   | 100 | % |
| 12.                   | Fangchengguang Steel Steel Project II                           |                         |   | 3,474,225  |                         |   |   | 3,417,983             |   |   |                                                                     | 3,417,983  |   |                                      |   | — |   |   |   | 100 | % |
| 13.                   | Tangshan Caofeidian Dredging and Reclamation I                  |                         |   | 9,220,678  |                         |   |   | 6,028,905             |   |   |                                                                     | 5,532,167  |   |                                      |   | 496,738 |   |   |   | 65 | % |
| 14.                   | Tangshan Caofeidian Dredging and Reclamation II                 |                         |   | 11,009,765 |                         |   |   | 7,325,728             |   |   |                                                                     | 6,605,511  |   |                                      |   | 720,217 |   |   |   | 67 | % |
|                       |                                                       |                         | $      | 89,946,561 |                         |   | $      | 80,333,888            |   |   | $                                                                        | 78,122,477 |   |                                      | $      | 2,211,411 |   |   |   |   |   |

----

| Backlog balance at December 31, 2009                                             |   | $      | 8,139,422    |   |
|----------------------------------------------------------------------------------|--------|--------|--------------|--------|
| New contracts entered during the year ended December 31, 2010                    |   |   | 184,386,368  |   |
| Add:  Adjustment of contracts due to change orders during the year     |   |   | 1,190,626    |   |
| Adjusted contract amount at December 31, 2010                                    |   |   | 193,716,416  |   |
| Less:  Contract revenue earned during the year ended December 31, 2010 |   |   | (131,405,665 | )      |
| Backlog balance at December 31, 2010                                             |   | $      | 62,310,751   |   |

|                               |   | 2010   |   |   | 2009   |   |
|------------------------------------|--------|--------|--------|--------|--------|--------|
| Social insurance prepaid for staff |   | $      | 1,124  |   |   | $      | 312 |   |
| Others                             |   |   | 122    |   |   |   | — |   |
|                          |   | $      | 1,246  |   |   | $      | 312 |   |

----

|              |   | 2010   |       |   | 2009   |   |
|-------------------|--------|--------|------------|--------|--------|--------|
| Non-related party |   | $      | 2,272,727  |   |   | $      | 2,197,158 |   |
| Related party     |   |   | 12,491,347 |   |   |   | — |   |
|         |   | $      | 14,764,074 |   |   | $      | 2,197,158 |   |

| Contracted, but not provided for:            |   |   |       |
|----------------------------------------------|--------|--------|------------|
| Acquisition of dredgers, net of deposit paid |   | $      | 29,149,562 |   |

| Payment Due Date (end of month after delivery) |   | Payment Amount |       |
|------------------------------------------------|--------|----------------|------------|
| August 31, 2012                                |   | $              | 8,409,091  |   |
| November 30, 2012                              |   |           | 7,007,576  |   |
| February 28, 2013                              |   |           | 7,007,576  |   |
| May 31, 2013                                   |   |           | 5,606,060  |   |
|                                      |   | $              | 28,030,303 |   |

----

| Payment Due Date                                       |   | Percentage oftotal contractsum |   |   | Payment Amount |   |
|------------------------------------------------------------------|--------|------------------------------------------|--------|--------|---------------------|--------|
|                                                        |   |                                     |   |   | $                   |   |   | RMB |   |
| Within 7 days after contract signed                              |   |                                     | 20     | %      |                |   | 7,878,788 |   |   |   | 52,000,000 |   |
| Within 1 month after contract signed                             |   |                                     | 30     | %      |                |   | 11,818,182 |   |   |   | 78,000,000 |   |
| Within 7 days after completion of main dredger hull              |   |                                     | 20     | %      |                |   | 7,878,788 |   |   |   | 52,000,000 |   |
| Within 7 days after dredger launched                             |   |                                     | 20     | %      |                |   | 7,878,788 |   |   |   | 52,000,000 |   |
| Before delivery of dredger after the completion of mooring trial |   |                                     | 10     | %      |                |   | 3,939,394 |   |   |   | 26,000,000 |   |
|                                                             |   |                                     |   |   |                |   | 39,393,940 |   |   |   | 260,000,000 |   |

|                                      |   | 2010   |        |   | 2009   |   |
|-------------------------------------------|--------|--------|-------------|--------|--------|--------|
| Dredgers                                  |   | $      | 54,235,409  |   |   | $      | 52,146,433 |   |
| Machinery                                 |   |   | 38,924      |   |   |   | — |   |
| Office equipment                          |   |   | 7,504       |   |   |   | 3,783 |   |
|                                 |   |   | 54,281,837  |   |   |   | 52,150,216 |   |
| Less:  Accumulated depreciation |   |   | (13,677,053 | )      |   |   | (8,638,979 | ) |
|                                 |   | $      | 40,604,784  |   |   | $      | 43,511,237 |   |

----

|                                     |   | 2010   |      |   | 2009   |   |
|-----------------------------------------------|--------|--------|-----------|--------|--------|--------|
| Accrued interest                              |   | $      | —   |   |   | $      | 27,527 |   |
| Accrued salaries and wages                    |   |   | 90,380    |   |   |   | 69,405 |   |
| Accrued staff benefits                        |   |   | 154,279   |   |   |   | 103,671 |   |
| Other tax payables                            |   |   | 42,758    |   |   |   | 9,077 |   |
| Accrued outsourced dredger services and labor |   |   | 2,082,954 |   |   |   | — |   |
| Other payables                                |   |   | 219,139   |   |   |   | — |   |
|                                     |   | $      | 2,589,510 |   |   | $      | 209,680 |   |

|                              |   | 2010   |                          |          | 2009   |   |
|----------------------------------------|--------|--------|-------------------------------|---------------|--------|--------|
| Fujian Haixia Bank Co., Ltd            |   | $      | —                       |          |   | $      | 3,661,930 |   |
| Fuzhou City Rural Credit Cooperative   |   |   | —                       |          |   |   | 3,368,976 |   |
|                              |   | $      | —                       |          |   | $      | 7,030,906 |   |
| Range of monthly interest rate         |   |   | 5.400 – 5.786 | ‰  |   |   | 5.974 | ‰  |
| Weighted average monthly interest rate |   |   | 5.085                         | ‰  |   |   | 5.974 | ‰  |

|                   |   | 2010 |    |   | 2009   |   |
|-----------------------------|--------|------|---------|--------|--------|--------|
| Fujian Haixia Bank Co., Ltd |   | $    | — |   |   | $      | 3,295,738 |   |

----

----

|          |   | 2010 |       |   | 2009   |   |
|--------------------|--------|------|------------|--------|--------|--------|
| Retained earnings  |   | $    | 13,392,884 |   |   | $      | 43,946,972 |   |
| Statutory reserves |   | $    | 10,295,279 |   |   | $      | 4,888,018 |   |

|                                                    |   | For the Years EndedDecember 31, |       |   | For the period fromJanuary 8, 2008(Inception) toDecember 31, |   |
|--------------------------------------------------------------|--------|-----------------------------------------------------|------------|--------|-------------------------------------------------------------------------------------------------|--------|
|                                                         |   | 2010(as restated)                              |       |   | 2009                                                                                            |   |   | 2008 |   |
|                                                         |   |                                                |       |   |                                                                                            |   |   |   |   |
| Income before tax                                            |   | $                                                   | 64,790,676 |   |                                                                                            | $      | 38,361,249 |   |   | $ | 26,767,137 |   |
|                                                         |   |                                                |       |   |                                                                                            |   |   |   |   |   |   |   |
| Expected PRC income tax expense at statutory tax rate of 25% |   | $                                                   | 16,197,669 |   |                                                                                            | $      | 9,590,312 |   |   | $ | 6,691,784 |   |
| Add: Non tax deductible expenses                             |   |                                                | 361,231    |   |                                                                                            |   | - |   |   |   | - |   |
| Effect of exchange rate                                      |   |                                                | (2,504     | )      |                                                                                            |   | 6,339 |   |   |   | 4,961 |   |
| Actual income tax expense                                    |   | $                                                   | 16,556,396 |   |                                                                                            | $      | 9,596,651 |   |   | $ | 6,696,745 |   |

----

|                     |   |                                               |   | For the Years Ended December 31, |      |   | For the period fromJanuary 8, 2008 (Inception) to |   |
|-------------------------------|--------|---------------------------------------------------------|--------|-----------------------------------------------------------|-----------|--------|--------------------------------------------------------------------------------------|--------|
| Type                          |   | Name of related party                    |   | 2010                                                      |      |   | 2009                                                                                 |   |   | December 31, 2008 |   |
| Office rental            |   | Ping Lin                                                |   | $                                                         | 11,653    |   |                                                                                 | $      | 8,872 |   |   | $ | 8,738 |   |
| Hire charge of dredger   |   | Fujian Lutong Highway Engineering Construction Co., Ltd |   |                                                      | 1,035,442 |   |                                                                                 |   | 1,024,845 |   |   |   | 588,792 |   |
| Hire charge of crew           |   | Fujian Lutong Highway Engineering Construction Co., Ltd |   |                                                      | 532,513   |   |                                                                                 |   | 527,063 |   |   |   | 302,807 |   |
|                |   |                                                    |   | $                                                         | 1,579,608 |   |                                                                                 | $      | 1,560,780 |   |   | $ | 900,337 |   |

----

|                       |   | Office rental |   |
|---------------------------------|--------|--------------------|--------|
| For the year ended December 31, |   |               |   |
| 2011                            |   | $                  | 24,936 |   |
| 2012                            |   |               | 11,936 |   |
| 2013                            |   |               | 11,936 |   |
| 2014                            |   |               | 11,936 |   |
| 2015                            |   |               | 11,936 |   |
|                       |   | $                  | 72,680 |   |

|                |   | For the Years EndedDecember 31, |    |   | For the period fromJanuary 8, 2008 |   |
|--------------------------|--------|-----------------------------------------------------|---------|--------|-------------------------------------------------------------|--------|
|      |   | 2010                                                |    |   | 2009                                                        |   |   | (Inception) toDecember 31, 2008 |   |
| Customer A          |   |                                                | — |   |                                                        |   | 40.3 | % |   |   | — |   |
| Customer B*         |   |                                                | 20.7    | %      |                                                        |   | 32.2 | % |   |   | 48.3 | % |
| Customer C*         |   |                                                | 36.4    | %      |                                                        |   | 16.6 | % |   |   | — |   |
| Customer D          |   |                                                | — |   |                                                        |   | 10.9 | % |   |   | 21.2 | % |
| Customer E          |   |                                                | — |   |                                                        |   | — |   |   |   | 23.9 | % |
| Customer F          |   |                                                | 10.6    | %      |                                                        |   | — |   |   |   | — |   |
| Customer G*         |   |                                                | 10.4    | %      |                                                        |   | — |   |   |   | — |   |
|           |   |                                                | 78.1    | %      |                                                        |   | 100.0 | % |   |   | 93.4 | % |

----

|    |   | For the Years Ended December 31, |    |   | For the period from January 8, 2008 |   |
|--------------|--------|-----------------------------------------------------------|---------|--------|-------------------------------------------------------------------|--------|
|    |   | 2010                                                      |    |   | 2009                                                              |   |   | (Inception) to December 31, 2008 |   |
| Supplier A   |   |                                                      | 22.4    | %      |                                                              |   | 64.5 | % |   |   | 61.7 | % |
| Supplier B   |   |                                                      | — |   |                                                              |   | 30.4 | % |   |   | 32.4 | % |
| Supplier C   |   |                                                      | 21.3    | %      |                                                              |   | — |   |   |   | — |   |
| Supplier D   |   |                                                      | 21.3    | %      |                                                              |   | — |   |   |   | — |   |
| Supplier E   |   |                                                      | 18.0    | %      |                                                              |   | — |   |   |   | — |   |
|    |   |                                                      | 83.0    | %      |                                                              |   | 94.9 | % |   |   | 94.1 | % |

|                                            |   | Hire chargeof dredgers |       |   | Hire chargeof crew |   |      | Consumable parts supply |   |   | Office rental |   |   | Total  |   |
|------------------------------------------------------|--------|----------------------------------|------------|--------|------------------------------|--------|-----------|-----------------------------------|--------|--------|--------------------|--------|--------|--------|--------|
| For the years ended December 31, |   |                             |       |   |                         |   |      |                              |   |   |               |   |   |   |   |
| 2011                                                 |   | $                                | 8,216,480  |   |                         | $      | 2,464,345 |                              |   | $      | 20,071,114         |   |   | $      | 24,936 |   |   | $ | 30,776,875 |   |
| 2012                                                 |   |                             | 4,742,425  |   |                         |   | 1,690,909 |                              |   |   | 11,363,636         |   |   |   | 11,936 |   |   |   | 17,808,906 |   |
| 2013                                                 |   |                             | 2,602,967  |   |                         |   | 1,080,253 |                              |   |   | 5,321,128          |   |   |   | 11,936 |   |   |   | 9,016,284 |   |
| 2014                                                 |   |                             | 719,697    |   |                         |   | 545,455   |                              |   |   | —            |   |   |   | 11,936 |   |   |   | 1,277,088 |   |
| 2015                                                 |   |                             | 719,697    |   |                         |   | 545,455   |                              |   |   | —            |   |   |   | 11,936 |   |   |   | 1,277,088 |   |
|                                            |   | $                                | 17,001,266 |   |                         | $      | 6,326,617 |                              |   | $      | 36,755,878         |   |   | $      | 72,680 |   |   | $ | 60,156,241 |   |

----

|                       |   | Note   |   |   | Hire charge of dredgers |   |       | Hire charge of crew |   |   | Consumable parts supply |   |   | Office rental |       |   | Total  |   |
|---------------------------------|--------|--------|--------|--------|----------------------------------------|--------|------------|------------------------------------|--------|--------|-----------------------------------|--------|--------|--------------------|------------|--------|--------|--------|
| Related parties commitments     |   |   | 16(a)  |   |                                   | $      | —    |                               |   | $      | —                           |   |   | $                  | —    |   |   | $      | 72,680 |   |   | $ | 72,680 |   |
| Non-related parties commitments |   |   |   |   |                                   |   | 17,001,266 |                               |   |   | 6,326,617                         |   |   |               | 36,755,878 |   |   |   | — |   |   |   | 60,083,561 |   |
|                       |   |   |   |   |                                   | $      | 17,001,266 |                               |   | $      | 6,326,617                         |   |   | $                  | 36,755,878 |   |   | $      | 72,680 |   |   | $ | 60,156,241 |   |

| CONDENSED BALANCE SHEET                                                                                                                                             |   |                         |        |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|-------------|
|                                                                                                                                                                     |   | As ofDecember 31,  |        |
|                                                                                                                                                                          |   | 2010 (as restated) |        |
| Assets                                                                                                                                                                        |   |                         |        |
| Cash                                                                                                                                                                          |   | $                            | 21,509,633  |   |
| Other receivables                                                                                                                                                             |   |                         | 122         |   |
| Investments in subsidiaries                                                                                                                                                   |   |                         | 145,992,195 |   |
| Total assets                                                                                                                                                                  |   | $                            | 167,501,950 |   |
|                                                                                                                                                                          |   |                         |        |   |
| Liabilities and equity                                                                                                                                                        |   |                         |        |   |
| Current liabilities                                                                                                                                                           |   |                         |        |   |
| Accrued liabilities and other payables                                                                                                                                        |   | $                            | 176,675     |   |
|                                                                                                                                                                          |   |                         |        |   |
| Non-current liabilities                                                                                                                                                       |   |                         |        |   |
| Contingent liability for a variable number of shares                                                                                                                          |   |                         | 14,101,247  |   |
| Derivative liability                                                                                                                                                          |   |                         | 1,517,748   |   |
| Total liabilities                                                                                                                                                             |   |                         | 15,795,670  |   |
|                                                                                                                                                                          |   |                         |        |   |
| Class A Preferred Shares, no par value; 25,000,000 shares authorized; 10,012,987 shares issued and outstanding (liquidation preference $50,064,935, less $6,135,012 discount) |   |                         | 43,929,923  |   |
|                                                                                                                                                                          |   |                         |        |   |
| Shareholders’ equity                                                                                                                                                    |   |                         |        |   |
| Total shareholders’ equity                                                                                                                                              |   |                         | 107,776,357 |   |
|                                                                                                                                                                          |   |                         |        |   |
| Total liabilities and equity                                                                                                                                                  |   | $                            | 167,501,950 |   |

----

| CONDENSED STATEMENT OF INCOME |   |                              |       |
|----------------------------------------------|--------|-----------------------------------|------------|
|                                         |   | For the YearEndedDecember 31,2010 |       |
|                                         |   |                              |       |
| General and administrative expenses          |   | $                                 | (2,005,780 | ) |
| Equity income of subsidiaries                |   |                              | 50,240,060 |   |
| Net income                                   |   | $                                 | 48,234,280 |   |

| CONDENSED STATEMENT OF CASH FLOWS |   |                                                |        |
|-------------------------------------------------------|--------|-----------------------------------------------------|-------------|
|                                                  |   | For the Year Ended December 31, 2010 |        |
|                                                  |   |                                                |        |
| Net cash used in operating activities                 |   | $                                                   | (1,022,324  | ) |
|                                                  |   |                                                |        |   |
| Net cash used in investing activities                 |   |                                                | (23,908,485 | ) |
|                                                  |   |                                                |        |   |
| Net cash provided by financing activities             |   |                                                | 46,443,286  |   |
|                                                  |   |                                                |        |   |
| Effect of exchange rate changes on cash               |   |                                                | (2,844      | ) |
|                                                  |   |                                                |        |   |
| Cash, end of year                                     |   | $                                                   | 21,509,633  |   |

----

|                                            |   | Aspreviouslyreported |        |   | As restated |   |        | Effect of change |   |
|------------------------------------------------------|--------|----------------------|-------------|--------|------------------|--------|-------------|----------------------------|--------|
| Contingent liability for a variable number of shares |   | $                    | -           |   |             | $      | 14,101,247  |                       |   | $ | 14,101,247 |   |
| Derivative liability                                 |   | $                    | -           |   |             | $      | 1,517,748   |                       |   | $ | 1,517,748 |   |
| Total non-current liabilities                        |   | $                    | -           |   |             | $      | 15,618,995  |                       |   | $ | 15,618,995 |   |
| Total liabilities                                    |   | $                    | 11,910,076  |   |             | $      | 27,259,071  |                       |   | $ | 15,348,995 |   |
| Class A Preferred Shares(A)                          |   | $                    | 18,591,783  |   |             | $      | 43,929,923  |                       |   | $ | 25,338,140 |   |
| Additional paid-in capital                           |   | $                    | 97,837,402  |   |             | $      | 79,185,284  |                       |   | $ | (18,652,118 | ) |
| Retained earnings                                    |   | $                    | 31,029,153  |   |             | $      | 13,392,884  |                       |   | $ | (17,636,269 | ) |
| Total shareholders’ equity                     |   | $                    | 167,325,275 |   |             | $      | 107,776,357 |                       |   | $ | (59,548,918 | ) |

----

| (A) | Class A Preferred Shares were originally labeled “preferred share” and included in shareholders’ equity. It has been reclassified outside of shareholders’ equity. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                              |   | As previously reported |       |   | As restated |   |        | Effect of change |   |
|---------------------------------------------------|--------|----------------------------------|------------|--------|------------------|--------|-------------|----------------------------|--------|
|                                              |   |                             |       |   |             |   |        |                       |   |
| Loss on derivative                                |   | $                                | -          |   |             | $      | (11,298     | )                          |   | $ | (11,298 | ) |
| Total other income (expense)                      |   | $                                | (720,370   | )      |             | $      | (731,668    | )                          |   | $ | (11,298 | ) |
| Income before income taxes                        |   | $                                | 64,801,974 |   |             | $      | 64,790,676  |                       |   | $ | (11,298 | ) |
| Net income                                        |   | $                                | 48,245,578 |   |             | $      | 48,234,280  |                       |   | $ | (11,298 | ) |
| Accretion of discount on Class A Preferred Shares |   | $                                | -          |   |             | $      | (22,293,720 | )                          |   | $ | (22,293,720 | ) |
| Net income attributable to ordinary shareholders  |   | $                                | 48,245,578 |   |             | $      | 25,940,460  |                       |   | $ | (22,305,018 | ) |
| Earnings per ordinary share – Basic         |   | $                                | 0.92       |   |             | $      | 0.50        |                       |   | $ | (0.42 | ) |
| Earnings per ordinary share – Diluted       |   | $                                | 0.91       |   |             | $      | 0.50        |                       |   | $ | (0.41 | ) |

|          |   | As Previously reported |       |   | As restated |   |       | Effect of change |   |
|--------------------|--------|----------------------------------|------------|--------|------------------|--------|------------|----------------------------|--------|
| Net income         |   | $                                | 48,245,578 |   |             | $      | 48,234,280 |                       |   | $ | (11,298 | ) |
|               |   |                             |       |   |             |   |       |                       |   |   |   |   |
| Loss on derivative |   | $                                | -          |   |             | $      | (11,298    | )                          |   | $ | (11,298 | ) |

|                  |   | As previously reported |       |   | As restated |   |       | Effect of change |   |
|----------------------------|--------|----------------------------------|------------|--------|------------------|--------|------------|----------------------------|--------|
| Net income                 |   | $                                | 48,245,578 |   |             | $      | 48,234,280 |                       |   | $ | (11,298 | ) |
| Total comprehensive income |   | $                                | 52,466,231 |   |             | $      | 52,454,934 |                       |   | $ | (11,297 | ) |

----

----

----

----

|                                                                       |   | December 31, |        |
|----------------------------------------------------------------------------|--------|-------------------|-------------|
|                                                                       |   | 2009              |        |   | 2008 |   |
| Assets                                                                     |   |              |        |   |   |   |
| Current assets                                                             |   |              |        |   |   |   |
| Cash                                                                       |   | $                 | 23,343,469  |   |   | $ | 1,362,142 |   |
| Cost and estimated earnings in excess of billings on contracts in progress |   |              | 2,211,411   |   |   |   | — |   |
| Other receivables                                                          |   |              | 312         |   |   |   | — |   |
| Inventories                                                                |   |              | 429,226     |   |   |   | — |   |
| Total current assets                                                       |   |              | 25,984,418  |   |   |   | 1,362,142 |   |
| Other assets                                                               |   |              |        |   |   |   |   |   |
| Prepaid dredger deposit                                                    |   |              | 2,197,158   |   |   |   | — |   |
| Security deposits                                                          |   |              | 8,422,440   |   |   |   | 8,427,995 |   |
| Property, plant and equipment, net                                         |   |              | 43,511,237  |   |   |   | 48,497,870 |   |
| Total other assets                                                         |   |              | 54,130,835  |   |   |   | 56,925,865 |   |
| Total assets                                                               |   | $                 | 80,115,253  |   |   | $ | 58,288,007 |   |
| Liabilities and owners’ equity                                       |   |              |        |   |   |   |   |   |
| Current liabilities                                                        |   |              |        |   |   |   |   |   |
| Term loans                                                                 |   | $                 | 7,030,906   |   |   | $ | 1,832,173 |   |
| Dredgers payable                                                           |   |              | —     |   |   |   | 17,859,098 |   |
| Income tax payable                                                         |   |              | 2,042,047   |   |   |   | 2,223,002 |   |
| Accrued liabilities and other payables                                     |   |              | 209,680     |   |   |   | 154,575 |   |
| Total current liabilities                                                  |   |              | 9,282,633   |   |   |   | 22,068,848 |   |
| Non-current liabilities                                                    |   |              |        |   |   |   |   |   |
| Term loans, net of current portion                                         |   |              | 3,295,738   |   |   |   | 6,962,257 |   |
| Total non-current liabilities                                              |   |              | 3,295,738   |   |   |   | 6,962,257 |   |
| Total liabilities                                                          |   |              | 12,578,371  |   |   |   | 29,031,105 |   |
| Owners’ equity                                                       |   |              |        |   |   |   |   |   |
| Registered capital                                                         |   |              | 29,002,371  |   |   |   | 8,501,266 |   |
| Statutory reserves                                                         |   |              | 4,888,018   |   |   |   | 2,009,023 |   |
| Retained earnings                                                          |   |              | 43,946,972  |   |   |   | 18,061,369 |   |
| Accumulated other comprehensive income                                     |   |              | 682,256     |   |   |   | 685,244 |   |
| Subscription receivable                                                    |   |              | (10,982,735 | ) |   |   | — |   |
| Total owners’ equity                                                 |   |              | 67,536,882  |   |   |   | 29,256,902 |   |
| Total liabilities and owners’ equity                                 |   | $                 | 80,115,253  |   |   | $ | 58,288,007 |   |

----

|                                                                                                                                                                                                             |   | For the yearEndedDecember 31,2009 |        |   | For the periodfrom January 8,2008 (Inception) toDecember 31,2008 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------|-------------|--------|-----------------------------------------------------------------------------------------------------|--------|
| Contract revenue                                                                                                                                                                                                 |   | $                                                | 80,333,891  |   |                                                                                                | $      | 54,480,271 |   |
| Cost of contract revenue, includes depreciation expense of $4,951,518 and $3,686,503 for the year ended December 31, 2009 and for the period from January 8, 2008 (Inception) to December 31, 2008, respectively |   |                                             | (38,715,490 | )      |                                                                                                |   | (25,424,227 | ) |
| Gross profit                                                                                                                                                                                                     |   |                                             | 41,618,401  |   |                                                                                                |   | 29,056,044 |   |
| General and administrative expenses                                                                                                                                                                              |   |                                             | (2,531,132  | )      |                                                                                                |   | (2,152,575 | ) |
| Income from operations                                                                                                                                                                                           |   |                                             | 39,087,269  |   |                                                                                                |   | 26,903,469 |   |
| Other income (expense):                                                                                                                                                                                          |   |                                             |        |   |                                                                                                |   |   |   |
| Interest income                                                                                                                                                                                                  |   |                                             | 29,833      |   |                                                                                                |   | 43,172 |   |
| Interest expenses                                                                                                                                                                                                |   |                                             | (755,853    | )      |                                                                                                |   | (179,504 | ) |
| Total other income (expense)                                                                                                                                                                                     |   |                                             | (726,020    | )      |                                                                                                |   | (136,332 | ) |
| Income before income taxes                                                                                                                                                                                       |   |                                             | 38,361,249  |   |                                                                                                |   | 26,767,137 |   |
| Income tax expense                                                                                                                                                                                               |   |                                             | (9,596,651  | )      |                                                                                                |   | (6,696,745 | ) |
| Net income                                                                                                                                                                                                       |   | $                                                | 28,764,598  |   |                                                                                                | $      | 20,070,392 |   |

----

|                                |   | RegisteredCapital |       |   | StatutoryReserves |   |      | RetainedEarnings |   |   | AccumulatedOtherComprehensiveIncome |   |   | SubscriptionReceivable |    |   | Total  |   |
|-------------------------------------|--------|-------------------|------------|--------|-------------------|--------|-----------|------------------|--------|--------|-------------------------------------|--------|--------|------------------------|---------|--------|--------|--------|
| Balance as of January 8, 2008       |   | $                 | —    |   |              | $      | —   |             |   | $      | —                             |   |   | $                      | — |   |   | $      | — |   |   | $ | — |   |
| Capital contributed by owners       |   |              | 8,501,266  |   |              |   | —   |             |   |   | —                             |   |   |                   | — |   |   |   | — |   |   |   | 8,501,266 |   |
| Net income                          |   |              | —    |   |              |   | —   |             |   |   | 20,070,392                          |   |   |                   | — |   |   |   | — |   |   |   | 20,070,392 |   |
| Appropriation to statutory reserves |   |              | —    |   |              |   | 2,009,023 |             |   |   | (2,009,023                          | )      |   |                   | — |   |   |   | — |   |   |   | — |   |
| Foreign currency translation gain   |   |              | —    |   |              |   | —   |             |   |   | —                             |   |   |                   | 685,244 |   |   |   | — |   |   |   | 685,244 |   |
| Balance as of December 31, 2008     |   |              | 8,501,266  |   |              |   | 2,009,023 |             |   |   | 18,061,369                          |   |   |                   | 685,244 |   |   |   | — |   |   |   | 29,256,902 |   |
| Capital contributed by owners       |   |              | 20,501,105 |   |              |   | —   |             |   |   | —                             |   |   |                   | — |   |   |   | — |   |   |   | 20,501,105 |   |
| Subscription receivable             |   |              | —    |   |              |   | —   |             |   |   | —                             |   |   |                   | — |   |   |   | (10,982,735 | ) |   |   | (10,982,735 | ) |
| Net income                          |   |              | —    |   |              |   | —   |             |   |   | 28,764,598                          |   |   |                   | — |   |   |   | — |   |   |   | 28,764,598 |   |
| Appropriation to statutory reserves |   |              | —    |   |              |   | 2,878,995 |             |   |   | (2,878,995                          | )      |   |                   | — |   |   |   | — |   |   |   | — |   |
| Foreign currency translation loss   |   |              | —    |   |              |   | —   |             |   |   | —                             |   |   |                   | (2,988  | )      |   |   | — |   |   |   | (2,988 | ) |
| Balance as of December 31, 2009     |   | $                 | 29,002,371 |   |              | $      | 4,888,018 |             |   | $      | 43,946,972                          |   |   | $                      | 682,256 |   |   | $      | (10,982,735 | ) |   | $ | 67,536,882 |   |

----

|                                                                              |   | For the yearEndedDecember 31,2009 |        |   | For the periodfrom January 8,2008 (Inception) toDecember 31,2008 |   |
|-----------------------------------------------------------------------------------|--------|-----------------------------------|-------------|--------|------------------------------------------------------------------|--------|
| Cash flows from operating activities:                                             |   |                              |        |   |                                                             |   |
| Net income                                                                        |   | $                                 | 28,764,598  |   |                                                             | $      | 20,070,392 |   |
| Adjustments to reconcile net income to net cash provided by operating activities: |   |                              |        |   |                                                             |   |   |   |
| Depreciation of property, plant and equipment                                     |   |                              | 4,952,236   |   |                                                             |   | 3,686,744 |   |
| Changes in operating assets and liabilities:                                      |   |                              |        |   |                                                             |   |   |   |
| Cost and estimated earnings in excess of billings on contracts in progress        |   |                              | (2,210,343  | )      |                                                             |   | — |   |
| Other receivables                                                                 |   |                              | (311        | )      |                                                             |   | — |   |
| Inventories                                                                       |   |                              | (429,018    | )      |                                                             |   | — |   |
| Income tax payable                                                                |   |                              | (179,402    | )      |                                                             |   | 2,186,909 |   |
| Accrued liabilities and other payables                                            |   |                              | 55,179      |   |                                                             |   | 152,067 |   |
| Net cash provided by operating activities                                         |   |                              | 30,952,939  |   |                                                             |   | 26,096,112 |   |
| Cash flows from investing activities:                                             |   |                              |        |   |                                                             |   |   |   |
| Deposit paid for dredgers                                                         |   |                              | (2,196,096  | )      |                                                             |   | — |   |
| Changes in security deposits                                                      |   |                              | —     |   |                                                             |   | (8,291,156 | ) |
| Payment of purchases of property, plant and equipment                             |   |                              | —     |   |                                                             |   | (33,768,198 | ) |
| Net cash used in investing activities                                             |   |                              | (2,196,096  | )      |                                                             |   | (42,059,354 | ) |
| Cash flows from financing activities:                                             |   |                              |        |   |                                                             |   |   |   |
| Repayment of term loans                                                           |   |                              | (1,830,080  | )      |                                                             |   | — |   |
| Proceeds from term loans                                                          |   |                              | 3,367,348   |   |                                                             |   | 8,651,641 |   |
| Payment of dredger payable                                                        |   |                              | (17,838,704 | )      |                                                             |   | — |   |
| Capital contributions from owners                                                 |   |                              | 9,516,419   |   |                                                             |   | 8,651,641 |   |
| Net cash (used in)/provided by financing activities                               |   |                              | (6,785,017  | )      |                                                             |   | 17,303,282 |   |
| Net increase in cash                                                              |   |                              | 21,971,826  |   |                                                             |   | 1,340,040 |   |
| Effect of exchange rate changes on cash                                           |   |                              | 9,501       |   |                                                             |   | 22,102 |   |
| Cash at beginning of year/period                                                  |   |                              | 1,362,142   |   |                                                             |   | — |   |
| Cash at end of year/period                                                        |   | $                                 | 23,343,469  |   |                                                             | $      | 1,362,142 |   |
| Non-cash investing and financing transactions:                                    |   |                              |        |   |                                                             |   |   |   |
| Purchases of property, plant and equipment with issuance of debt                  |   | $                                 | —     |   |                                                             | $      | 17,569,133 |   |
| Supplemental information:                                                         |   |                              |        |   |                                                             |   |   |   |
| Cash paid for income tax                                                          |   | $                                 | 9,776,053   |   |                                                             | $      | 4,509,876 |   |
| Cash paid for interest                                                            |   | $                                 | 753,776     |   |                                                             | $      | 154,451 |   |

----

|   | 1. | DESCRIPTION OF BUSINESS AND ORGANIZATION |
|--------|----|------------------------------------------|

|   | 2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
|--------|----|--------------------------------------------|

----

|             |   | Estimated lives |   |
|------------------|--------|----------------------|--------|
| Dredgers         |   |                 | 10     |   |
| Office equipment |   |                 | 5      |   |

----

|                                                  |   | Year ended December 31, 2009 |       |   | For theperiod from January 8, 2008 (Inception) to December 31, 2008 |   |
|-------------------------------------------------------|--------|--------------------------------------------------|------------|--------|-----------------------------------------------------------------------------------------------------------------------|--------|
| Net income                                            |   | $                                                | 28,764,598 |   |                                                                                                                  | $      | 20,070,392 |   |
| Other comprehensive income                            |   |                                             |       |   |                                                                                                                  |   |   |   |
| – Foreign currency translation adjustments |   |                                             | (2,988     | )      |                                                                                                                  |   | 685,244 |   |
| Total comprehensive income                            |   | $                                                | 28,761,610 |   |                                                                                                                  | $      | 20,755,636 |   |

----

----

----

| Name of contract |                                                      | Estimated contractvalue |   |       | Total revenuerecognized |   |   | Amountreceived/billed |   |   | Cost andestimatedearnings in excess of billings |       |   | Status of contract(Completion %) |   |
|----------------------------|-----------------------------------------------------------|------------------------------|--------|------------|------------------------------|--------|--------|-----------------------|--------|--------|--------------------------------------------------------------------------|------------|--------|-------------------------------------------------|--------|
| 1.                         | Zhuhai Gaolan Port Dredging I                             |                         | $      | 3,593,400  |                         |   | $      | 3,562,573             |   |   | $                                                                        | 3,562,573  |   |                                            | $      | — |   |   |   | 100 | %   |
| 2.                         | Zhuhai Gaolan Port Dredging II                            |                         |   | 4,160,871  |                         |   |   | 4,057,455             |   |   |                                                                     | 4,057,455  |   |                                            |   | — |   |   |   | 100 | %   |
| 3.                         | Zhuhai Gaolan Port Dredging III                           |                         |   | 1,669,034  |                         |   |   | 1,184,474             |   |   |                                                                     | 834,347    |   |                                            |   | 350,127 |   |   |   | 71 | %   |
| 4.                    | Zhanjiang Industrial Centre Dredging and Reclamation I    |                         |   | 2,912,024  |                         |   |   | 2,839,336             |   |   |                                                                     | 2,839,336  |   |                                            |   | — |   |   |   | 100 | %   |
| 5.                         | Dalin Chandao Hulushan Dredging I                         |                         |   | 7,378,885  |                         |   |   | 7,332,395             |   |   |                                                                     | 7,332,395  |   |                                            |   | — |   |   |   | 100 | %   |
| 6.                    | Dalin Chandao Hulushan Dredging II                        |                         |   | 8,608,699  |                         |   |   | 8,623,406             |   |   |                                                                     | 8,623,406  |   |                                            |   | — |   |   |   | 100 | %   |
| 7.                    | Oujiang Port Lantian Dredging I                           |                         |   | 7,589,711  |                         |   |   | 7,210,493             |   |   |                                                                     | 7,210,493  |   |                                            |   | — |   |   |   | 100 | %   |
| 8.                    | Oujiang Port Lantian Dredging II                          |                         |   | 7,115,354  |                         |   |   | 6,336,300             |   |   |                                                                     | 5,691,971  |   |                                            |   | 644,329 |   |   |   | 89 | %   |
| 9.                    | Taishan Tongguhai Zone Guohuatai Dianmei Port Dredging I  |                         |   | 674,641    |                         |   |   | 674,469               |   |   |                                                                     | 674,469    |   |                                            |   | — |   |   |   | 100 | %   |
| 10.                   | Taishan Tongguhai Zone Guohuatai Dianmei Port Dredging II |                         |   | 3,513,755  |                         |   |   | 3,383,060             |   |   |                                                                     | 3,383,060  |   |                                            |   | — |   |   |   | 100 | %   |
| 11.                   | Fangchengguang Steel Project I                            |                         |   | 19,025,519 |                         |   |   | 18,357,311            |   |   |                                                                     | 18,357,311 |   |                                            |   | — |   |   |   | 100 | %   |
| 12.                   | Fangchengguang Steel Steel Project II                     |                         |   | 3,474,225  |                         |   |   | 3,417,983             |   |   |                                                                     | 3,417,983  |   |                                            |   | — |   |   |   | 100 | %  |
| 13.                   | Tangshan Caofeidian Dredging and Reclamation I            |                         |   | 9,220,678  |                         |   |   | 6,028,905             |   |   |                                                                     | 5,532,167  |   |                                            |   | 496,738 |   |   |   | 65 | %   |
| 14.                   | Tangshan Caofeidian Dredging and Reclamation II           |                         |   | 11,009,765 |                         |   |   | 7,325,728             |   |   |                                                                     | 6,605,511  |   |                                            |   | 720,217 |   |   |   | 67 | %   |
|                       |                                                      |                         | $      | 89,946,561 |                         |   | $      | 80,333,888            |   |   | $                                                                        | 78,122,477 |   |                                            | $      | 2,211,411 |   |   |   |   |   |

| Backlog balance at December 31, 2008                                |   | $      | —     |   |
|--------------------------------------------------------------------------|--------|--------|-------------|--------|
| New contracts during the year                                       |   |   | 89,946,562  |   |
| Less: Adjustment of contracts due to change orders during the year  |   |   | (1,473,249  | )      |
| Adjusted contract amount at December 31, 2009                       |   |   | 88,473,313  |   |
| Less: Contract revenue earned during the year                       |   |   | (80,333,891 | )      |
| Backlog balance at December 31, 2009                                |   | $      | 8,139,422   |   |

----

|   | 5.  | INVENTORIES |
|--------|----------|-------------|

|   | 6. | OTHER RECEIVABLES |
|--------|----|-------------------|

|                                     |   | 2009  |      |   | 2008   |   |
|------------------------------------------|--------|------------|-----------|--------|--------|--------|
| Social insurance prepaid for staff  |   | $          | 312  |   |   | $      | — |   |

|   | 7. | PREPAID DREDGER DEPOSIT AND CAPITAL COMMITMENT |
|--------|----|------------------------------------------------|

|                    |   | 2009 |      |   | 2008   |   |
|-------------------------|--------|------|-----------|--------|--------|--------|
| Prepaid dredger deposit |   | $    | 2,197,158 |   |   | $      | — |   |

| Contracted, but not provided for:            |   |   |       |
|---------------------------------------------------|--------|--------|------------|
| Acquisition of dredger, net of deposit paid  |   | $      | 27,098,286 |   |

| Payment Due Date(end of month after delivery)   |   | Payment Amount |       |
|-----------------------------------------------------------------------------------------|--------|---------------------|------------|
| August 31, 2012                                                                    |   | $                   | 8,129,485  |   |
| November 30, 2012                                                                  |   |                | 6,774,572  |   |
| February 28, 2013                                                                  |   |                | 6,774,572  |   |
| May 31, 2013                                                                       |   |                | 5,419,657  |   |
|                                                                          |   | $                   | 27,098,286 |   |

----

|   | 8. | SECURITY DEPOSITS |
|--------|----|-------------------|

|   | 9. | PROPERTY, PLANT AND EQUIPMENT |
|--------|----|-------------------------------|

|                           |   | 2009   |       |   | 2008   |   |
|--------------------------------|--------|--------|------------|--------|--------|--------|
| Dredgers                       |   | $      | 52,146,433 |   |   | $      | 52,180,828 |   |
| Office equipment               |   |   | 3,784      |   |   |   | 3,786 |   |
|                           |   |   | 52,150,217 |   |   |   | 52,184,614 |   |
| Less: Accumulated depreciation |   |   | (8,638,980 | )      |   |   | (3,686,744 | ) |
|                           |   | $      | 43,511,237 |   |   | $      | 48,497,870 |   |

|   | 10. | TERM LOANS |
|--------|-----|------------|

|                                                    |   | 2009   |      |          | 2008   |   |
|---------------------------------------------------------|--------|--------|-----------|---------------|--------|--------|
| Fuzhou City Rural Credit Cooperative               |   | $      | 3,368,976 |          |   | $      | — |   |
| Fujian Haixia Bank Co., Ltd                        |   |   | 3,661,930 |          |   |   | 1,832,173 |   |
|                                          |   | $      | 7,030,906 |          |   | $      | 1,832,173 |   |
| Interest expenses incurred during the year/period  |   | $      | 209,212   |          |   | $      | — |   |
| Range of monthly interest rate                     |   |   | 5.974     | ‰  |   |   | N/A |   |
| Weighted average monthly interest rate             |   |   | 5.974     | ‰  |   |   | N/A |   |

|   | 11. | ACCRUED EXPENSES AND OTHER PAYABLES |
|--------|-----|-------------------------------------|

|                       |   | 2009   |    |   | 2008   |   |
|----------------------------|--------|--------|---------|--------|--------|--------|
| Accrued interest           |   | $      | 27,527  |   |   | $      | 25,466 |   |
| Accrued salaries and wages |   |   | 69,405  |   |   |   | 66,145 |   |
| Accrued staff benefits     |   |   | 103,671 |   |   |   | 44,909 |   |
| Other tax payables         |   |   | 9,077   |   |   |   | 18,055 |   |
|                       |   | $      | 209,680 |   |   | $      | 154,575 |   |

----

|                                               |   | 2009   |                           |   | 2008   |   |                            |
|----------------------------------------------------|--------|--------|--------------------------------|--------|--------|--------|---------------------------------|
| Fujian Haixia Bank Co., Ltd.                       |   | $      | 3,295,738                      |   |   | $      | 6,962,257                       |   |
| Maximum balance outstanding during the year/period |   | $      | 8,788,633                      |   |   | $      | 8,794,430                       |   |
| Interest expenses incurred during the year/period  |   |   | 546,641                        |   |   |   | 179,504                         |   |
| Range of monthly interest rate                     |   |   | 5.400 – 5.850% |   |   |   | 5.850 – 7.6055% |   |
| Weighted average monthly interest rate             |   |   | 5.717%                         |   |   |   | 6.7276%                         |   |

|         |   | Note  |   |   |   |      |
|--------------|--------|------------|--------|--------|--------|-----------|
| 2010         |   | 10         |   |   | $      | 3,661,930 |   |
| 2011         |   |       |   |   |   | 3,295,738 |   |
|    |   |       |   |   | $      | 6,957,668 |   |

----

|               |   | 2009  |       |   | 2008   |   |
|--------------------|--------|------------|------------|--------|--------|--------|
| Retained earnings  |   | $          | 43,946,972 |   |   | $      | 18,061,369 |   |
| Statutory reserves |   | $          | 4,888,018  |   |   | $      | 2,009,023 |   |

|                       |   |  For theyear ended December 31, 2009 |      |   | For theperiod from January 8, 2008 (Inception) to December 31,2008 |   |
|----------------------------|--------|--------------------------------------------------------------------|-----------|--------|------------------------------------------------------------------------------------------------------------|--------|
| Current income tax expense |   | $                                                                  | 9,596,651 |   |                                                                                                       | $      | 6,696,745 |   |

|                                                         |   |  For theyear ended December 31,  2009 |       |   | For theperiod fromJanuary 8, 2008 (Inception) to December 31,2008 |   |
|--------------------------------------------------------------|--------|--------------------------------------------------------------------------|------------|--------|-----------------------------------------------------------------------------------------------------------|--------|
| Income before tax                                            |   | $                                                                        | 38,361,249 |   |                                                                                                      | $      | 26,767,137 |   |
|                                                         |   |                                                                     |       |   |                                                                                                      |   |   |   |
| Expected PRC income tax expense at statutory tax rate of 25% |   | $                                                                        | 9,590,312  |   |                                                                                                      | $      | 6,691,784 |   |
| Effect of exchange rate                                      |   |                                                                     | 6,339      |   |                                                                                                      |   | 4,961 |   |
| Actual income tax expense                                    |   | $                                                                        | 9,596,651  |   |                                                                                                      | $      | 6,696,745 |   |

----

|                   | Name of related party                    |   | For theyear ended December 31, 2009 |      |   | For theperiod fromJanuary 8, 2008 (Inception) to December 31, 2008 |   |
|------------------------|---------------------------------------------------------|--------|--------------------------------------------------------------|-----------|--------|-----------------------------------------------------------------------------------------------------------------|--------|
| Office rental          | Ping Lin                                                |   | $                                                            | 8,872     |   |                                                                                                            | $      | 8,738 |   |
| Hire charge of dredger | Fujian Lutong Highway Engineering Construction Co., Ltd |   |                                                         | 1,024,845 |   |                                                                                                            |   | 588,792 |   |
| Hire charge of crew    | Fujian Lutong Highway Engineering Construction Co., Ltd |   |                                                         | 527,063   |   |                                                                                                            |   | 302,807 |   |
|                   |                                                    |   | $                                                            | 1,560,780 |   |                                                                                                            | $      | 900,337 |   |

|                            |   | Office rental |   |
|---------------------------------|--------|--------------------|--------|
| For the year ended December 31, |   |               |   |
| 2010                            |   | $                  | 11,539 |   |
| 2011                            |   |               | 11,539 |   |
| 2012                            |   |               | 11,539 |   |
| 2013                            |   |               | 11,539 |   |
| 2014                            |   |               | 11,539 |   |
| Thereafter                      |   |               | 11,539 |   |
|                       |   | $                  | 69,234 |   |

----

| Guarantees given to the bank to secure the bank loan granted to related party |   | $ | 7,909,770 |   |
|-------------------------------------------------------------------------------|--------|---|-----------|--------|

|         |   |  For theyear ended December31, 2009 |               |   | For theperiod fromJanuary 8, 2008 (Inception) toDecember 31, 2008 |               |
|--------------|--------|-----------------------------------------------|--------------------|--------|------------------------------------------------------------------------|--------------------|
| Customer A   |   | 40%                                           |     |   | —                                                                |     |
| Customer B*  |   | 32%                                           |               |   | 48%                                                                    |               |
| Customer C*  |   | 17%                                           |               |   | —                                                                |               |
| Customer D   |   | 11%                                           |               |   | 21%                                                                    |               |
| Customer E   |   | —                                       |               |   | 24%                                                                    |               |
|    |   | 100%                                          |               |   | 93%                                                                    |               |

|   | * | Indicates customers under control of a common parent company. |
|--------|---|---------------------------------------------------------------|

|         |   |  For theyear ended December 31, 2009  |               |   | For theperiod from January 8, 2008 (Inception) to December 31, 2008 |               |
|--------------|--------|--------------------------------------------------------------------------|--------------------|--------|-----------------------------------------------------------------------------------------------------------------------|--------------------|
| Supplier A   |   | 65%                                                                      |     |   | 62%                                                                                                                   |     |
| Supplier B   |   | 30%                                                                      |               |   | 32%                                                                                                                   |               |
|    |   | 95%                                                                      |               |   | 94%                                                                                                                   |               |

----

|                            |   |  Hire chargeof dredger |      |   | Hire chargeof crew |   |      | Office rental |   |   | Total  |   |
|---------------------------------|--------|---------------------------------------|-----------|--------|------------------------------|--------|-----------|--------------------|--------|--------|--------|--------|
| For the year ended December 31, |   |                                  |      |   |                         |   |      |               |   |   |   |   |
| 2010                            |   | $                                     | 695,767   |   |                         | $      | 930,716   |               |   | $      | 11,539 |   |   | $ | 1,638,022 |   |
| 2011                            |   |                                  | 695,767   |   |                         |   | 637,909   |               |   |   | 11,539 |   |   |   | 1,345,215 |   |
| 2012                            |   |                                  | 695,767   |   |                         |   | 527,318   |               |   |   | 11,539 |   |   |   | 1,234,624 |   |
| 2013                            |   |                                  | 695,767   |   |                         |   | 527,318   |               |   |   | 11,539 |   |   |   | 1,234,624 |   |
| 2014                            |   |                                  | 695,767   |   |                         |   | 527,318   |               |   |   | 11,539 |   |   |   | 1,234,624 |   |
| Thereafter                      |   |                                  | 695,767   |   |                         |   | 527,318   |               |   |   | 11,539 |   |   |   | 1,234,624 |   |
|                       |   | $                                     | 4,174,602 |   |                         | $      | 3,677,897 |               |   | $      | 69,234 |   |   | $ | 7,921,733 |   |

|                            |   | Note   |   |   | Hire chargeof dredgers |      |   | Hire chargeof crew |   |      | Office rental |   |   | Total   |   |
|---------------------------------|--------|--------|--------|--------|----------------------------------|-----------|--------|------------------------------|--------|-----------|--------------------|--------|--------|---------|--------|
|                            |   |   |   |   |                             |      |   |                         |   |      |               |   |   |    |   |
| Related parties commitments     |   | 16(a)  |   |   | $                                | —   |   |                         | $      | —   |               |   | $      | 69,234  |   |   | $ | 69,234 |   |
| Non-related parties commitments |   |   |   |   |                             | 4,174,602 |   |                         |   | 3,677,897 |               |   |   | — |   |   |   | 7,852,499 |   |
|                       |   |   |   |   | $                                | 4,174,602 |   |                         | $      | 3,677,897 |               |   | $      | 69,234  |   |   | $ | 7,921,733 |   |

----

| Fujian Haixia Bank Co., Ltd          |   | $      | 5,859,088 |   |
|--------------------------------------|--------|--------|-----------|--------|
| Fuzhou City Rural Credit Cooperative |   |   | 3,368,976 |   |
|                            |   | $      | 9,228,064 |   |

----

|                                                                                                                                                                              | PAGE                  |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------|
| CONDENSED BALANCE SHEETS AS OF JUNE 30, 2010 (UNAUDITED) AND AS OF SEPTEMBER 30, 2009                                                                                             | F-63                  |
| CONDENSED STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED JUNE 30, 2010 AND 2009 AND FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO JUNE 30, 2010 (UNAUDITED) | F-64                  |
| CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIENCY FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO JUNE 30, 2010 (UNAUDITED)                                  | F-65                  |
| CONDENSED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED JUNE 30, 2010 AND 2009 AND FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO JUNE 30, 2010 (UNAUDITED)           | F-66                  |
| NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)                                                                                                                               | F-67– F-69 |

----

|                                                                                                                |   | June 30,2010 |    |   | September 30,2009 |   |
|---------------------------------------------------------------------------------------------------------------------|--------|--------------|---------|--------|-------------------|--------|
|                                                                                                           |   | (Unaudited)  |    |   |              |   |
| ASSETS                                                                                                              |   |         |    |   |              |   |
| Current Assets                                                                                                      |   |         |    |   |              |   |
| Prepaid Expense                                                                                                     |   | $            | 1,515   |   |              | $      | — |   |
| Total Assets                                                                                                        |   | $            | 1,515   |   |              | $      | — |   |
| LIABILITIES AND STOCKHOLDERS’ DEFICIENCY                                                                      |   |         |    |   |              |   |   |   |
| Current Liabilities                                                                                                 |   |         |    |   |              |   |   |   |
| Accounts payable                                                                                                    |   | $            | 750     |   |              | $      | 8,411 |   |
| Note payable – related party                                                                        |   |         | 33,688  |   |              |   | 4,065 |   |
| Total Liabilities                                                                                                   |   |         | 34,438  |   |              |   | 12,476 |   |
| Commitments and Contingencies                                                                                       |   |         |    |   |              |   |   |   |
| Stockholders’ Deficiency                                                                                      |   |         |    |   |              |   |   |   |
| Common stock, no par value; 50,000 shares authorized, 50,000 and 50,000 shares issued and outstanding, respectively |   |         | 31,499  |   |              |   | 23,010 |   |
| Deficit accumulated during the development stage                                                                    |   |         | (64,422 | )      |              |   | (35,486 | ) |
| Total Stockholders’ Deficiency                                                                                |   |         | (32,923 | )      |              |   | (12,476 | ) |
| Total Liabilities and Stockholders’ Deficiency                                                                |   | $            | 1,515   |   |              | $      | — |   |

----

|                                                                                                |   | For theThree MonthsEndedJune 30, 2010 |    |   | For theThree MonthsEndedJune 30, 2009 |   |    | For theNine MonthsEndedJune 30, 2010 |   |   | For theNine MonthsEndedJune 30, 2009 |   |   | For thePeriod fromSeptember 26,2008 (Inception)to June 30, 2010 |    |
|-----------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|--------|---------------------------------------|--------|---------|--------------------------------------|--------|--------|--------------------------------------|--------|--------|-----------------------------------------------------------------|---------|
| Operating Expenses                                                                                  |   |                                  |    |   |                                  |   |    |                                 |   |   |                                 |   |   |                                                            |    |
| Professional fees                                                                                   |   | $                                     | 10,540  |   |                                  | $      | 4,950   |                                 |   | $      | 17,669                               |   |   | $                                                               | 18,794  |   |   | $ | 41,073 |   |
| General and administrative                                                                          |   |                                  | 4,050   |   |                                  |   | 3,679   |                                 |   |   | 10,578                               |   |   |                                                            | 9,472   |   |   |   | 22,660 |   |
| Total Operating Expenses                                                                            |   |                                  | 14,590  |   |                                  |   | 8,629   |                                 |   |   | 28,247                               |   |   |                                                            | 28,266  |   |   |   | 63,733 |   |
| Loss from Operations                                                                                |   |                                  | (14,590 | )      |                                  |   | (8,629  | )                                    |   |   | (28,247                              | )      |   |                                                            | (28,266 | ) |   |   | (63,733 | ) |
| Other Expenses                                                                                      |   |                                  |    |   |                                  |   |    |                                 |   |   |                                 |   |   |                                                            |    |   |   |   |   |   |
| Interest Expense                                                                                    |   |                                  | (378    | )      |                                  |   | — |                                 |   |   | (689                                 | )      |   |                                                            | — |   |   |   | (689 | ) |
| LOSS FROMOPERATIONS BEFORE INCOME TAXES                                                             |   |                                  | (14,968 | )      |                                  |   | (8,629  | )                                    |   |   | (28,936                              | )      |   |                                                            | (28,266 | ) |   |   | (64,422 | ) |
| Provision for Income Taxes                                                                          |   |                                  | — |   |                                  |   | — |                                 |   |   | —                              |   |   |                                                            | — |   |   |   | — |   |
| NET LOSS                                                                                            |   | $                                     | (14,968 | )      |                                  | $      | (8,629  | )                                    |   | $      | (28,936                              | )      |   | $                                                               | (28,266 | ) |   | $ | (64,422 | ) |
| Net Loss Per Share – Basic and Diluted                                              |   | $                                     | (0.30   | )      |                                  | $      | (0.17   | )                                    |   | $      | (0.58                                | )      |   | $                                                               | (0.64   | ) |   |   |   |   |
| Weighted average number of shares outstanding during the period – Basic and Diluted |   |                                  | 50,000  |   |                                  |   | 50,000  |                                 |   |   | 50,000                               |   |   |                                                            | 44,493  |   |   |   |   |   |

----

|                                                                              |   | Common stock |    |   | Deficitaccumulatedduringdevelopmentstage |   |    | TotalStockholders’Deficiency |   |
|-----------------------------------------------------------------------------------|--------|-------------------|---------|--------|------------------------------------------|--------|---------|------------------------------------|--------|
|                                                                              |   | Shares            |    |   | Amount                                   |   |    |                               |   |   |   |   |
| Balance, September 26, 2008 (Inception)                                           |   |              | — |   |                                     | $      | — |                               |   | $ | — |   |   | $ | — |   |
| Common stock issued for services to founder ($0.0027/Sh)                          |   |              | 3,676   |   |                                     |   | 10      |                               |   |   | — |   |   |   | 10 |   |
| Net loss for the period from September 26, 2008 (inception) to September 30, 2008 |   |              | — |   |                                     |   | — |                               |   |   | (1,510 | ) |   |   | (1,510 | ) |
| Balance, September 30, 2008                                                       |   |              | 3,676   |   |                                     |   | 10      |                               |   |   | (1,510 | ) |   |   | (1,500 | ) |
| Common stock issued for cash ($0.27/Sh)                                           |   |              | 46,324  |   |                                     |   | 12,600  |                               |   |   | — |   |   |   | 12,600 |   |
| In-kind contribution of services                                                  |   |              | — |   |                                     |   | 10,400  |                               |   |   | — |   |   |   | 10,400 |   |
| Net loss for the year ended September 30, 2009                                    |   |              | — |   |                                     |   | — |                               |   |   | (33,976 | ) |   |   | (33,976 | ) |
| Balance, September 30, 2009                                                       |   |              | 50,000  |   |                                     |   | 23,010  |                               |   |   | (35,486 | ) |   |   | (12,476 | ) |
| In-kind contribution of services                                                  |   |              | — |   |                                     |   | 7,800   |                               |   |   | — |   |   |   | 7,800 |   |
| In-kind contribution of interest                                                  |   |              | — |   |                                     |   | 689     |                               |   |   | — |   |   |   | 689 |   |
| Net loss for the nine months ended June 30, 2010                                  |   |              | — |   |                                     |   | — |                               |   |   | (28,936 | ) |   |   | (28,936 | ) |
| Balance, June 30, 2010                                                            |   |              | 50,000  |   |                                     | $      | 31,499  |                               |   | $ | (64,422 | ) |   | $ | (32,923 | ) |

----

|                                                             |   | For theNine MonthsEnded June 30,2010 |    |   | For theNine MonthsEnded June 30,2009 |   |    | For thePeriod from September 26,2008 (Inception)to June 30,2010 |   |
|------------------------------------------------------------------|--------|----------------------------------------------------------|---------|--------|----------------------------------------------------------|--------|---------|----------------------------------------------------------------------------------------------------|--------|
| Cash Flows Used In Operating Activities:                         |   |                                                     |    |   |                                                     |   |    |                                                                                               |   |
| Net Loss                                                         |   | $                                                        | (28,936 | )      |                                                     | $      | (28,266 | )                                                                                                  |   | $ | (64,422 | ) |
| Adjustments to reconcile net loss to net cash used in operations |   |                                                     |    |   |                                                     |   |    |                                                                                               |   |   |   |   |
| Common stock issued for services                                 |   |                                                     | — |   |                                                     |   | — |                                                                                               |   |   | 10 |   |
| In-kind contribution of interest                                 |   |                                                     | 689     |   |                                                     |   | — |                                                                                               |   |   | 689 |   |
| In-kind contribution of services                                 |   |                                                     | 7,800   |   |                                                     |   | 7,800   |                                                                                               |   |   | 18,200 |   |
| Changes in operating assets and liabilities:                     |   |                                                     |    |   |                                                     |   |    |                                                                                               |   |   |   |   |
| Increase in prepaid expenses                                     |   |                                                     | (1,515  | )      |                                                     |   | — |                                                                                               |   |   | (1,515 | ) |
| Increase in accounts payable                                     |   |                                                     | (7,661  | )      |                                                     |   | 3,800   |                                                                                               |   |   | 750 |   |
| Net Cash Used In Operating Activities                            |   |                                                     | (29,623 | )      |                                                     |   | (16,666 | )                                                                                                  |   |   | (46,288 | ) |
| Cash Flows From Financing Activities:                            |   |                                                     |    |   |                                                     |   |    |                                                                                               |   |   |   |   |
| Proceeds from loan payable – related party       |   |                                                     | 29,623  |   |                                                     |   | 4,066   |                                                                                               |   |   | 33,688 |   |
| Proceeds from issuance of common stock                           |   |                                                     | — |   |                                                     |   | 12,600  |                                                                                               |   |   | 12,600 |   |
| Net Cash Provided by Financing Activities                        |   |                                                     | 29,623  |   |                                                     |   | 16,666  |                                                                                               |   |   | 46,288 |   |
| Net Increase in Cash                                             |   |                                                     | — |   |                                                     |   | — |                                                                                               |   |   | — |   |
| Cash at Beginning of Period                                      |   |                                                     | — |   |                                                     |   | — |                                                                                               |   |   | — |   |
| Cash at End of Period                                            |   | $                                                        | — |   |                                                     | $      | — |                                                                                               |   | $ | — |   |
| Supplemental disclosure of cash flow information:                |   |                                                     |    |   |                                                     |   |    |                                                                                               |   |   |   |   |
| Cash paid for interest                                           |   | $                                                        | — |   |                                                     | $      | — |                                                                                               |   | $ | — |   |
| Cash paid for taxes                                              |   | $                                                        | — |   |                                                     | $      | — |                                                                                               |   | $ | — |   |

----

----

----

----

|                                                                                                                                                                                                                                                                                                                                             | PAGE                         |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------|
| REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                                                                                                                                                                                                                                                                                          | F-71                         |
| BALANCE SHEETS AS OF JANUARY 31, 2010 AND SEPTEMBER 30, 2009                                                                                                                                                                                                                                                                                     | F-72                         |
| STATEMENTS OF OPERATIONS FOR THE PERIOD FROM OCTOBER 1, 2009 TO JANUARY 31 2010, FOR THE PERIOD FROM OCTOBER 1, 2008 TO JANUARY 31, 2009 (UNAUDITED), FOR THE YEAR ENDED SEPTEMBER 30, 2009, FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO SEPTEMBER 30, 2008 AND FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO JANUARY 31, 2010 | F-73                         |
| STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIENCY FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO JANUARY 31, 2010                                                                                                                                                                                                                    | F-74                         |
| STATEMENTS OF CASH FLOWS FOR THE PERIOD FROM OCTOBER 1, 2009 TO JANUARY 31 2010, FOR THE PERIOD FROM OCTOBER 1, 2008 TO JANUARY 31, 2009 (UNAUDITED), FOR THE YEAR ENDED SEPTEMBER 30, 2009, FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO SEPTEMBER 30, 2008 AND FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO JANUARY 31, 2010 | F-75                         |
| NOTES TO FINANCIAL STATEMENTS.                                                                                                                                                                                                                                                                                                                   | F-76 –  F-79 |

----

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|                                                                                                                |   | January 31,2010 |    |   | September 30,2009 |   |
|---------------------------------------------------------------------------------------------------------------------|--------|-----------------|---------|--------|-------------------|--------|
| ASSETS                                                                                                              |   |            |    |   |              |   |
| Total Assets                                                                                                        |   | $               | — |   |              | $      | — |   |
| LIABILITIES AND STOCKHOLDERS’ DEFICIENCY                                                                      |   |            |    |   |              |   |   |   |
| Current Liabilities                                                                                                 |   |            |    |   |              |   |   |   |
| Loans payable – related party                                                                       |   | $               | 14,754  |   |              | $      | 8,411 |   |
| Accounts payable                                                                                                    |   |            | 6,181   |   |              |   | 4,065 |   |
| Total Liabilities                                                                                                   |   |            | 20,935  |   |              |   | 12,476 |   |
| Commitments and Contingencies                                                                                       |   |            | — |   |              |   | — |   |
| Stockholders’ Deficiency                                                                                      |   |            |    |   |              |   |   |   |
| Common stock, no par value; 50,000 shares authorized, 50,000 and 50,000 shares issued and outstanding, respectively |   |            | 26,747  |   |              |   | 23,010 |   |
| Deficit accumulated during the development stage                                                                    |   |            | (47,682 | )      |              |   | (35,486 | ) |
| Total Stockholders’ Deficiency                                                                                |   |            | (20,935 | )      |              |   | (12,476 | ) |
| Total Liabilities and Stockholders’ Deficiency                                                                |   | $               | — |   |              | $      | — |   |

----

|                                                                                                |   | For the Period FromOctober 1,2009 toJanuary 31,2010 |    |   | For the PeriodFrom October 1,2008 toJanuary 31,2009 |   |    | For the YearEndedSeptember 30,2009 |   |   | For thePeriod fromSeptember 26,2008 (Inception)to September 30,2008 |   |   | For thePeriod fromSeptember 26,2008 (Inception)to January 31,2010 |    |
|-----------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------|---------|--------|-----------------------------------------------------------------------------------|--------|---------|---------------------------------------------------|--------|--------|---------------------------------------------------------------------------------------------------|--------|--------|-------------------------------------------------------------------------------------------------|---------|
|                                                                                           |   |                                                                              |    |   | (Unaudited)                                                                       |   |    |                                              |   |   |                                                                                              |   |   |                                                                                            |    |
| Operating Expenses                                                                                  |   |                                                                              |    |   |                                                                              |   |    |                                              |   |   |                                                                                              |   |   |                                                                                            |    |
| Professional fees                                                                                   |   | $                                                                                 | 7,129   |   |                                                                              | $      | 13,019  |                                              |   | $      | 21,904                                                                                            |   |   | $                                                                                               | 1,500   |   |   | $ | 30,533 |   |
| General and administrative                                                                          |   |                                                                              | 4,797   |   |                                                                              |   | 4,035   |                                              |   |   | 12,072                                                                                            |   |   |                                                                                            | 10      |   |   |   | 16,879 |   |
| Total Operating Expenses                                                                            |   |                                                                              | 11,926  |   |                                                                              |   | 17,054  |                                              |   |   | 33,976                                                                                            |   |   |                                                                                            | 1,510   |   |   |   | 47,412 |   |
| Loss from Operations                                                                                |   |                                                                              | (11,926 | )      |                                                                              |   | (17,054 | )                                                 |   |   | (33,976                                                                                           | )      |   |                                                                                            | (1,510  | ) |   |   | (47,412 | ) |
| Other Expenses                                                                                      |   |                                                                              |    |   |                                                                              |   |    |                                              |   |   |                                                                                              |   |   |                                                                                            |    |   |   |   |   |   |
| Interest Expense                                                                                    |   |                                                                              | (270    | )      |                                                                              |   | — |                                              |   |   | —                                                                                           |   |   |                                                                                            | — |   |   |   | (270 | ) |
| LOSS FROM OPERATIONS BEFORE INCOME TAXES                                                            |   |                                                                              | (12,196 | )      |                                                                              |   | (17,054 | )                                                 |   |   | (33,976                                                                                           | )      |   |                                                                                            | (1,510  | ) |   |   | (47,682 | ) |
| Provision for Income Taxes                                                                          |   |                                                                              | — |   |                                                                              |   | — |                                              |   |   | —                                                                                           |   |   |                                                                                            | — |   |   |   | — |   |
| NET LOSS                                                                                            |   | $                                                                                 | (12,196 | )      |                                                                              | $      | (17,054 | )                                                 |   | $      | (33,976                                                                                           | )      |   | $                                                                                               | (1,510  | ) |   | $ | (47,682 | ) |
| Net Loss Per Share – Basic and Diluted                                              |   | $                                                                                 | (0.24   | )      |                                                                              | $      | (0.46   | )                                                 |   | $      | (0.74                                                                                             | )      |   | $                                                                                               | (0.41   | ) |   |   |   |   |
| Weighted average number of shares outstanding during the period – Basic and Diluted |   |                                                                              | 50,000  |   |                                                                              |   | 37,090  |                                              |   |   | 45,673                                                                                            |   |   |                                                                                            | 3,676   |   |   |   |   |   |

----

|                                                                              |   | Common stock |    |   | Deficitaccumulatedduringdevelopmentstage |   |    | TotalStockholders’Deficiency |   |
|-----------------------------------------------------------------------------------|--------|-------------------|---------|--------|------------------------------------------|--------|---------|------------------------------------|--------|
|                                                                              |   | Shares            |    |   | Amount                                   |   |    |                               |   |   |   |   |
| Balance, September 26, 2008 (inception)                                           |   |              | — |   |                                     | $      | — |                               |   | $ | — |   |   | $ | — |   |
| Common stock issued for services to founder ($0.0027/Sh)                          |   |              | 3,676   |   |                                     |   | 10      |                               |   |   | — |   |   |   | 10 |   |
| Net loss for the period from September 26, 2008 (inception) to September 30, 2008 |   |              | — |   |                                     |   | — |                               |   |   | (1,510 | ) |   |   | (1,510 | ) |
| Balance, September 30, 2008                                                       |   |              | 3,676   |   |                                     |   | 10      |                               |   |   | (1,510 | ) |   |   | (1,500 | ) |
| Common stock issued for cash ($0.27/Sh)                                           |   |              | 46,324  |   |                                     |   | 12,600  |                               |   |   | — |   |   |   | 12,600 |   |
| In kind contribution of services                                                  |   |              | — |   |                                     |   | 10,400  |                               |   |   | — |   |   |   | 10,400 |   |
| Net loss for the year ended September 30, 2009                                    |   |              | — |   |                                     |   | — |                               |   |   | (33,976 | ) |   |   | (33,976 | ) |
| Balance, September 30, 2009                                                       |   |              | 50,000  |   |                                     |   | 23,010  |                               |   |   | (35,486 | ) |   |   | (12,476 | ) |
| In kind contribution of services                                                  |   |              | — |   |                                     |   | 3,467   |                               |   |   | — |   |   |   | 3,467 |   |
| In kind contribution of interest                                                  |   |              | — |   |                                     |   | 270     |                               |   |   | — |   |   |   | 270 |   |
| Net loss for the period from October 1, 2009 to January 31, 2010                  |   |              | — |   |                                     |   | — |                               |   |   | (12,196 | ) |   |   | (12,196 | ) |
| Balance, January 31, 2010                                                         |   |              | 50,000  |   |                                     | $      | 26,747  |                               |   | $ | (47,682 | ) |   | $ | (20,935 | ) |

----

|                                                             |   | For thePeriod fromOctober 1, 2009to January 31,2010 |    |   | For thePeriod fromOctober 1, 2008to January 31,2009 |   |    | For theYear EndedSeptember 30,2009 |   |   | For thePeriod FromSeptember 26,2008(Inception) toSeptember 30,2008 |   |   | For thePeriod fromSeptember 26,2008 (Inception)to January 31,2010 |    |
|------------------------------------------------------------------|--------|-----------------------------------------------------|---------|--------|-----------------------------------------------------|--------|---------|------------------------------------|--------|--------|--------------------------------------------------------------------|--------|--------|-------------------------------------------------------------------|---------|
|                                                        |   |                                                |    |   | (Unaudited)                                         |   |    |                               |   |   |                                                               |   |   |                                                              |    |
| Cash Flows Used In Operating Activities:                         |   |                                                |    |   |                                                |   |    |                               |   |   |                                                               |   |   |                                                              |    |
| Net Loss                                                         |   | $                                                   | (12,196 | )      |                                                | $      | (17,054 | )                                  |   | $      | (33,976                                                            | )      |   | $                                                                 | (1,510  | ) |   | $ | (47,682 | ) |
| Adjustments to reconcile net loss to net cash used in operations |   |                                                |    |   |                                                |   |    |                               |   |   |                                                               |   |   |                                                              |    |   |   |   |   |   |
| Common stock issued for services                                 |   |                                                | — |   |                                                |   | — |                               |   |   | —                                                            |   |   |                                                              | 10      |   |   |   | 10 |   |
| In-kind contribution of interest                                 |   |                                                | 270     |   |                                                |   | — |                               |   |   | —                                                            |   |   |                                                              | — |   |   |   | 270 |   |
| In-kind contribution of services                                 |   |                                                | 3,467   |   |                                                |   | 3,467   |                               |   |   | 10,400                                                             |   |   |                                                              | — |   |   |   | 13,867 |   |
| Changes in operating assets and liabilities:                     |   |                                                |    |   |                                                |   |    |                               |   |   |                                                               |   |   |                                                              |    |   |   |   |   |   |
| Increase in accounts payable                                     |   |                                                | 6,343   |   |                                                |   | 987     |                               |   |   | 6,911                                                              |   |   |                                                              | 1,500   |   |   |   | 14,754 |   |
| Net Cash Used In Operating Activities                            |   |                                                | (2,116  | )      |                                                |   | (12,600 | )                                  |   |   | (16,665                                                            | )      |   |                                                              | — |   |   |   | (18,781 | ) |
| Cash Flows From Financing Activities:                            |   |                                                |    |   |                                                |   |    |                               |   |   |                                                               |   |   |                                                              |    |   |   |   |   |   |
| Proceeds from loan payable – related party       |   |                                                | 2,116   |   |                                                |   | — |                               |   |   | 4,065                                                              |   |   |                                                              | — |   |   |   | 6,181 |   |
| Proceeds from issuance of common stock                           |   |                                                | — |   |                                                |   | 12,600  |                               |   |   | 12,600                                                             |   |   |                                                              | — |   |   |   | 12,600 |   |
| Net Cash Provided by Financing Activities                        |   |                                                | 2,116   |   |                                                |   | 12,600  |                               |   |   | 16,665                                                             |   |   |                                                              | — |   |   |   | 18,781 |   |
| Net Increase in Cash                                             |   |                                                | — |   |                                                |   | — |                               |   |   | —                                                            |   |   |                                                              | — |   |   |   | — |   |
| Cash at Beginning of Period                                      |   |                                                | — |   |                                                |   | — |                               |   |   | —                                                            |   |   |                                                              | — |   |   |   | — |   |
| Cash at End of Period                                            |   | $                                                   | — |   |                                                | $      | — |                               |   | $      | —                                                            |   |   | $                                                                 | — |   |   | $ | — |   |
| Supplemental disclosure of cash flow information:                |   |                                                |    |   |                                                |   |    |                               |   |   |                                                               |   |   |                                                              |    |   |   |   |   |   |
| Cash paid for interest                                           |   | $                                                   | — |   |                                                | $      | — |                               |   | $      | —                                                            |   |   | $                                                                 | — |   |   | $ | — |   |
| Cash paid for taxes                                              |   | $                                                   | — |   |                                                | $      | — |                               |   | $      | —                                                            |   |   | $                                                                 | — |   |   | $ | — |   |

----

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|                                                                                                                      |   | January 31,2010 |    |   | September 30,2009 |   |
|---------------------------------------------------------------------------------------------------------------------------|--------|-----------------|---------|--------|-------------------|--------|
| Expected income tax recovery (expense) at the statutory rate of 34%                                                       |   | $               | (4,147  | )      |              | $      | (11,552 | ) |
| Tax effect of expenses that are not deductible for income tax purposes (net of other amounts deductible for tax purposes) |   |            | 1,271   |   |              |   | 3,536 |   |
| Tax effect of differences in the timing of deductibility of items for income tax purposes                                 |   |            | — |   |              |   | — |   |
| Change in valuation allowance                                                                                             |   |            | 2,876   |   |              |   | 8,016 |   |
| Provision for income taxes                                                                                                |   | $               | — |   |              | $      | — |   |

|                             |   | January 31,2010 |    |   | September 30,2009 |   |
|----------------------------------|--------|-----------------|---------|--------|-------------------|--------|
| Deferred income tax asset:       |   |            |    |   |              |   |
| Net operating loss carryforwards |   | $               | 11,402  |   |              | $      | 8,526 |   |
| Valuation allowance              |   |            | (11,402 | )      |              |   | (8,526 | ) |
| Deferred income taxes            |   | $               | — |   |              | $      | — |   |

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|                                                                                                                                                                                 | PAGE              |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------|
| CONDENSED BALANCE SHEETS AS OF SEPTEMBER 30, 2010 (UNAUDITED) AND AS OF JANUARY 31, 2010                                                                                             | F-81              |
| CONDENSED STATEMENTS OF OPERATIONS FOR THE PERIOD FROM FEBRUARY 1, 2010 TO SEPTEMBER 30, 2010 (UNAUDITED) AND THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO JANUARY 31, 2010     | F-82              |
| CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIENCY FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO SEPTEMBER 30, 2010 (UNAUDITED)                                | F-83              |
| CONDENSED STATEMENTS OF CASH FLOWS FOR THE PERIOD FROM FEBRUARY 1, 2010 TO SEPTEMBER 30, 2010 (UNAUDITED) AND FOR THE PERIOD FROM SEPTEMBER 26, 2008 (INCEPTION) TO JANUARY 31, 2010 | F-84              |
| NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)                                                                                                                                  | F-85 – F-87 |

----

|                                                                                                                |   | September 30, 2010 |    |   | January 31,2010 |   |
|---------------------------------------------------------------------------------------------------------------------|--------|------------------------------|---------|--------|----------------------|--------|
|                                                                                                                |   | (Unaudited)                  |    |   | (Audited)            |   |
| ASSETS                                                                                                              |   |                         |    |
| Current Assets                                                                                                      |   |                         |    |   |                 |   |
| Prepaid Expense                                                                                                     |   | $                            | 1,010   |   |                 | $      | — |   |
| Total Assets                                                                                                        |   | $                            | 1,010   |   |                 | $      | — |   |
| LIABILITIES AND STOCKHOLDERS’ DEFICIENCY                                                                      |   |                         |    |   |                 |   |   |   |
| Current Liabilities                                                                                                 |   |                         |    |   |                 |   |   |   |
| Accounts payable                                                                                                    |   | $                            | 16,524  |   |                 | $      | 6,181 |   |
| Note payable – related party                                                                        |   |                         | 34,640  |   |                 |   | 14,754 |   |
| Total Liabilities                                                                                                   |   |                         | 51,164  |   |                 |   | 20,935 |   |
| Commitments and ContingenciesStockholders’ Deficiency                                                         |   |                         |    |   |                 |   |   |   |
| Common stock, no par value; 50,000 shares authorized, 50,000 and 50,000 shares issued and outstanding, respectively |   |                         | 34,098  |   |                 |   | 26,747 |   |
| Deficit accumulated during the development stage                                                                    |   |                         | (84,252 | )      |                 |   | (47,682 | ) |
| Total Stockholders’ Deficiency                                                                                |   |                         | (50,154 | )      |                 |   | (20,935 | ) |
| Total Liabilities and Stockholders’ Deficiency                                                                |   | $                            | 1,010   |   |                 | $      | — |   |

----

|                                                                                                |   | For the Period from February 1,2010 to September 30, 2010 |    |   | For the Period from September 26,2008 (Inception) to January 31,2010 |   |
|-----------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------|---------|--------|-------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                           |   | Unaudited                                                                                              |    |   | Audited                                                                                                           |   |
| Operating Expenses                                                                                  |   |                                                                                                   |    |   |                                                                                                              |   |
| Professional fees                                                                                   |   | $                                                                                                      | 26,514  |   |                                                                                                              | $      | 30,533 |   |
| General and administrative                                                                          |   |                                                                                                   | 9,637   |   |                                                                                                              |   | 16,879 |   |
| Total Operating Expenses                                                                            |   |                                                                                                   | 36,151  |   |                                                                                                              |   | 47,412 |   |
| Loss from Operations                                                                                |   |                                                                                                   | (36,151 | )      |                                                                                                              |   | (47,412 | ) |
| Other Expenses                                                                                      |   |                                                                                                   |    |   |                                                                                                              |   |   |   |
| Interest Expense                                                                                    |   |                                                                                                   | (419    | )      |                                                                                                              |   | (270 | ) |
| LOSS FROM OPERATIONS BEFORE INCOME TAXES                                                            |   |                                                                                                   | (36,570 | )      |                                                                                                              |   | (47,682 | ) |
| Provision for Income Taxes                                                                          |   |                                                                                                   | — |   |                                                                                                              |   | — |   |
| NET LOSS                                                                                            |   | $                                                                                                      | (36,570 | )      |                                                                                                              | $      | (47,682 | ) |
| Net Loss Per Share – Basic and Diluted                                              |   | $                                                                                                      | (0.73   | )      |                                                                                                              | $      | (0.95 | ) |
| Weighted average number of shares outstanding during the period – Basic and Diluted |   |                                                                                                   | 50,000  |   |                                                                                                              |   | 50,000 |   |

----

|                                                                       |   | Common stock |    |   | Deficit accumulated |   |    | Total Stockholders’     |   |
|----------------------------------------------------------------------------|--------|-------------------|---------|--------|--------------------------|--------|---------|------------------------------------|--------|
|                                                                       |   | Shares            |    |   | Amount                   |   |    | during development stage |   |   | Deficiency |   |
| Balance, September 26, 2008 (inception)                                    |   | $                 | — |   |                     | $      | — |                               |   | $ | — |   |   | $ | — |   |
| Common stock issued for services to founder ($0.0027/Sh)                   |   |              | 3,676   |   |                     |   | 10      |                               |   |   | — |   |   |   | 10 |   |
| Common stock issued for cash ($0.27/Sh)                                    |   |              | 46,324  |   |                     |   | 12,600  |                               |   |   | — |   |   |   | 12,600 |   |
| In-kind contribution of service                                            |   |              | — |   |                     |   | 13,867  |                               |   |   | — |   |   |   | 13,867 |   |
| In-kind contribution of interest                                           |   |              | — |   |                     |   | 270     |                               |   |   | — |   |   |   | 270 |   |
| Net loss for the period September 26, 2008 (inception) to January 31, 2010 |   |              | — |   |                     |   | — |                               |   |   | (47,682 | ) |   |   | (47,682 | ) |
| Balance, January 31, 2010                                                  |   |              | 50,000  |   |                     |   | 26,747  |                               |   |   | (47,682 | ) |   |   | (20,935 | ) |
| In-kind contribution of services                                           |   |              | — |   |                     |   | 6,932   |                               |   |   | — |   |   |   | 6,932 |   |
| In-kind contribution of interest                                           |   |              | — |   |                     |   | 419     |                               |   |   | — |   |   |   | 419 |   |
| Net loss for the period ended September 30, 2010                           |   |              | — |   |                     |   | — |                               |   |   | (36,570 | ) |   |   | (36,570 | ) |
| Balance, September 30, 2010                                                |   |              | 50,000  |   |                     | $      | 34,098  |                               |   | $ | (84,252 | ) |   | $ | (50,154 | ) |

----

|                                                             |   | For the Period from February 1,2010 to September 30, 2010 |    |   | For the Period from September26, 2008 (Inception) to January 31, 2010 |   |
|------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------|---------|--------|-------------------------------------------------------------------------------------------------------------------------|--------|
|                                                        |   | Unaudited                                                                                              |    |   | Audited                                                                                                                 |   |
| Cash Flows Used In Operating Activities:                         |   |                                                                                                   |    |   |                                                                                                                    |   |
| Net Loss                                                         |   | $                                                                                                      | (36,570 | )      |                                                                                                                    | $      | (47,682 | ) |
| Adjustments to reconcile net loss to net cash used in operations |   |                                                                                                   |    |   |                                                                                                                    |   |   |   |
| Common stock issued for services                                 |   |                                                                                                   | — |   |                                                                                                                    |   | 10 |   |
| In-kind contribution of interest                                 |   |                                                                                                   | 419     |   |                                                                                                                    |   | 270 |   |
| In-kind contribution of services                                 |   |                                                                                                   | 6,932   |   |                                                                                                                    |   | 13,867 |   |
| Changes in operating assets and liabilities:                     |   |                                                                                                   |    |   |                                                                                                                    |   |   |   |
| Increase in prepaid expenses                                     |   |                                                                                                   | (1,010  | )      |                                                                                                                    |   | — |   |
| Increase in accounts payable                                     |   |                                                                                                   | 10,343  |   |                                                                                                                    |   | 14,754 |   |
| Net Cash Used In Operating Activities                            |   |                                                                                                   | (19,886 | )      |                                                                                                                    |   | (18,781 | ) |
| Cash Flows From Financing Activities:                            |   |                                                                                                   |    |   |                                                                                                                    |   |   |   |
| Proceeds from loan payable-related party                         |   |                                                                                                   | 19,886  |   |                                                                                                                    |   | 6,181 |   |
| Proceeds from issuance of common stock                           |   |                                                                                                   | — |   |                                                                                                                    |   | 12,600 |   |
| Net Cash Provided by Financing Activities                        |   |                                                                                                   | 28,459  |   |                                                                                                                    |   | 18,781 |   |
| Net Increase in Cash                                             |   |                                                                                                   | — |   |                                                                                                                    |   | — |   |
| Cash at Beginning of Period                                      |   |                                                                                                   | — |   |                                                                                                                    |   | — |   |
| Cash at End of Period                                            |   | $                                                                                                      | — |   |                                                                                                                    | $      | — |   |
| Supplemental disclosure of cash flow information:                |   |                                                                                                   |    |   |                                                                                                                    |   |   |   |
| Cash paid for interest                                           |   | $                                                                                                      | — |   |                                                                                                                    | $      | — |   |
| Cash paid for taxes                                              |   | $                                                                                                      | — |   |                                                                                                                    | $      | — |   |

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| Exhibit No.  |   | Description                                                                                                                                                                                                                    |
|-------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 1.1 (1)           |   | Amended and Restated Memorandum of Association of China Dredging Group Co., Ltd.                                                                                                                                               |
| 1.2 (1)           |   | Articles of Association of China Dredging Group Co., Ltd.                                                                                                                                                                      |
| 2.1               |   | Specimen Ordinary Share Certificate.                                                                                                                                                                                           |
| 4.1 (1)           |   | Employment Agreement of Xinrong Zhuo.                                                                                                                                                                                          |
| 4.2 (1)           |   | Employment Agreement of Bin Lin.                                                                                                                                                                                               |
| 4.3 (1)           |   | Employment Agreement of Fangjie Gu.                                                                                                                                                                                            |
| 4.4 (1)           |   | Agreement and Plan of Merger by and among Chardan Acquisition Corp., Shareholders of Chardan Acquisition Corp., China Dredging Group Co., Ltd. and Shareholders Of China Dredging Group Co., Ltd. dated October 27, 2010.      |
| 4.5 (1)           |   | Securities Purchase Agreement by and among China Dredging Group Co., Ltd. and the Purchasers Listed on Exhibit A thereto, dated October 29, 2010.                                                                              |
| 4.6 (1)           |   | Registration Rights Agreement dated October 29, 2010.                                                                                                                                                                          |
| 4.7 (1)           |   | Securities Escrow Agreement dated October 29, 2010.                                                                                                                                                                            |
| 4.8 (3)           |   | Contracted Management Agreement by and among Fujian WangGang Dredging Construction Co., Ltd., Wonder Dredging LLC and  Fujian Xing Gang Port Service Ltd., dated June 30, 2010.                                      |
| 4.9 (3)           |   | Equity Interest Pledge Agreement by and among Qing Lin, Panxing Zhuo, Fujian WangGang Dredging Construction Co., Ltd. and Wonder Dredging LLC, dated June 30, 2010.                                                            |
| 4.10 (3)          |   | Contract Relating to the Exclusive Purchase Right of Equity Interest by and among Fujian WangGang Dredging Construction Co., Ltd., Wonder Dredging LLC and  Fujian Xing Gang Port Service Ltd., dated June 30, 2010. |
| 4.11 (1)          |   | Power of Attorney by and among Qing Lin, Panxing Zhuo and Fujian WangGang Dredging Construction Co., Ltd., dated June 30, 2010.                                                                                                |
| 4.12 (1)          |   | Power of Attorney by and between Wonder Dredging LLC and Fujian WangGang Dredging Construction Co., Ltd., dated June 30, 2010.                                                                                                 |
| 4.13 (1)          |   | Engineering Boat Purchase and Sale Contract for Xinggangjun #3 by and between Yiyang Zhonghai Boats and Ships Limited Liability Company and Fujian Xing Gang Shipping Service Co., Ltd., January 13, 2008                      |
| 4.14 (1)          |   | “Hongtaihai” Engineering Boat Purchase and Sale Contract for Xinggangjun #66 by and between Taizhou Hongtaihai Port Engineering Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., March 23, 2008.         |
| 4.15 (1)          |   | Engineering Boat Purchase and Sale Contract for Xinggangjun #6 by and between Yiyang Zhonghai Boats and Ships Limited Liability Company and Fujian Xing Gang Shipping Service Co., Ltd., dated January 18, 2008.               |
| 4.16 (1)     |   | Engineering Boat Purchase and Sale Contract by and between Yiyang Zhonghai Boats and Ships Limited Liability Company and Fujian Xing Gang Shipping Service Co., Ltd., dated May 20, 2009.                                 |
| 4.17 (1)          |   | Crewmen Dispatch Contract for Xinggangjun #3 by and between Fujian Haiyi International Shipping Service Agency Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., April 21, 2008.                                      |
| 4.18 (1)          |   | Crewmen Dispatch Contract for Xinggangjun #66 by and between Fujian Haiyi International Shipping Service Agency Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., February 21, 2008.                                  |
| 4.19 (1)          |   | Crewmen Dispatch Contract for Xinggangjun #6 by and between Fujian Haiyi International Shipping Service Agency Co., Ltd. and Fujian Xinggang Shipping Service Co., Ltd., dated April 21, 2008.                                 |
| 4.20 (1)          |   | Ship Lease Contract for Hengshengjun #88 by and between Lianyungang Hengrong Shipping Service Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated January 8, 2008.                                                |
| 4.21 (1)          |   | Crewmen Assignment Agreement for Hengshengjun #88 by and between Lianyungang Hengrong Shipping Service Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated January 8, 2008.                                       |

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| 4.22 (1) |   | Ship Lease Supplemental Agreement for Hengshengjun #88 by and between Lianyungang Hengrong Shipping Service Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated April 13, 2010.                           |
|----------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.23 (1) |   | Crewmen Assignment Supplemental Agreement for Hengshengjun #88 by and between Lianyungang Hengrong Shipping Service Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated May 21, 2010.                     |
| 4.24 (1) |   | Ship Lease Contract for Xinggangjun #9 by and between Fujian Lutong Highway Engineering Construction Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated May 20, 2008.                                    |
| 4.25 (1) |   | Crewmen Assignment Agreement for Xinggangjun #9 by and between Fujian Lutong Highway Engineering Construction Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated May 20, 2008.                           |
| 4.26 (1) |   | Ship Lease Supplemental Agreement Contract for Xinggangjun #9 by and between Fujian Lutong Highway Engineering Construction Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated April 11, 2010.           |
| 4.27 (1) |   | Crewmen Assignment Supplemental Agreement for Xinggangjun #9 by and between Fujian Lutong Highway Engineering Construction Co., Ltd. and Fujian Xing Gang Shipping Service Co., Ltd., dated May 21, 2010.              |
| 4.28 (1) |   | Ship Lease Contract for Liya #10 by and between Beihai Shunda Liya Shipping Service Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 14, 2010.                                                        |
| 4.29 (1) |   | Crewmen Assignment Agreement for Liya #10 by and between Beihai Shunda Liya Shipping Service Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 14, 2010.                                               |
| 4.30 (1) |   | Ship Leasing Contract for Honglinjun #9 by and between Zhejiang Honglin Ship Engineering Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 19, 2010.                                                   |
| 4.31 (1) |   | Crewmen Assignment Agreement for Honglinjun #9 by and between Zhejiang Honglin Ship Engineering Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 19, 2010.                                            |
| 4.32 (1) |   | Ship Lease Contract for Honglinjun #18 by and between Zhejiang Honglin Ship Engineering Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 18, 2010.                                                    |
| 4.33 (1) |   | Crewmen Assignment Agreement for Honglinjun #18 by and between Zhejiang Honglin Ship Engineering Co., Ltd. and Fujian Xing Gang Port Service Co., Ltd., dated June 18, 2010.                                           |
| 4.34 (1) |   | Ship Lease Contract for Xiechang #18 by and between Zhonghai Engineering Construction General Bureau Dalian Engineering Construction Bureau and Fujian Xing Gang Port Service Co., Ltd., dated June 24, 2010.          |
| 4.35 (1) |   | Crewmen Assignment Agreement for Xiechang #18 by and between Zhonghai Engineering Construction General Bureau Dalian Engineering Construction Bureau and Fujian Xing Gang Port Service Co., Ltd., dated June 24, 2010. |
| 4.36 (1) |   | Office Lease Agreement by and between LIN Ping and Fujian Xing Gang Shipping Service Co., Ltd., dated January 1, 2008.                                                                                                 |
| 4.37 (1) |   | Office Lease Agreement by and between LIN Ping and Fujian Xing Gang Port Service Co., Ltd., dated January 1, 2010.                                                                                                     |
| 4.38 (1) |   | Office Lease Supplemental Agreement by and between LIN Ping and Fujian Xing Gang Port Service Co., Ltd., dated March 30, 2010.                                                                                         |
| 4.39 (2) |   | Employment Agreement by and between Fangjie Gu and Fujian Xing Gang Port Service Co., Ltd. dated January 24, 2011.                                                                                                     |
| 4.40 (2) |   | Supplemental Employment Agreement by and between Fangjie Gu and China Dredging Group Co., Ltd.                                                                                                                         |
| 4.41     |   | Employment Agreement of Alfred Ho.                                                                                                                                                                                     |
| 8.1 (1)  |   | List of Subsidiaries.                                                                                                                                                                                                  |
| 12.1     |   | Certification of Principal Executive Officer required by Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                   |
| 12.2     |   | Certification of Principal Financial Officer required by Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                   |

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| 13.1 |   | Certification of Principal Executive Officer pursuant to 18 U.S.C., Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|
| 13.2 |   | Certification of Principal Financial Officer pursuant to 18 U.S.C., Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
| 15.1 |   | Letter from Webb & Company                                                                                                                          |

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