UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

                 ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
                      SECURITIES AND EXCHANGE ACT OF 1934
                   for the fiscal year ended December 31, 2004

                       Commission File Number: [000-33167]

                    KIWA BIO-TECH PRODUCTS GROUP CORPORATION
        (Exact name of small business issuer as specified in its charter)

                     Delaware                          84-0448400
         -------------------------------       ----------------------
         (State or other jurisdiction of           (I.R.S. Employer
          incorporation or organization)        Identification Number)


      17700 Castleton Street, Suite 589, City of Industry, California 91748
      ---------------------------------------------------------------------
                    (Address of principal executive offices)

       Registrant's telephone number, including area code: (626) 964-3232

       Securities registered under Section 12(b) of the Exchange Act: None

         Securities registered under Section 12(g) of the Exchange Act:

      Title of each class              Name of each exchange on which registered
  Common Stock, $0.001 par value                   OTB Bulletin Board

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes [ X ] No [ ]

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. Yes[ ] No[ X ]

Issuer's Revenues for its most recent year:  $1,300,251.

As of March 22, 2005, the aggregate  market value of voting and nonvoting equity
stock held by  non-affiliates  of the  registrant,  based upon the closing sales
price for the  registrant's  common stock, as reported on the OTB Bulletin Board
quotation service, was approximately $436,000.

Number of shares of registrant's  common stock  outstanding as of March 22, 2005
was 45,135,930 shares.

Portions of the  registrant's  definitive  proxy  statement  to be  delivered to
shareholders  in connection  with the 2005 annual meeting of  shareholders to be
held on June 24, 2005 are  incorporated  by reference in response to Part III of
this Form 10-KSB.

Transitional Small Business Disclosure Format:  Yes[  ] No[ X ]


<PAGE>


            KIWA BIO-TECH PRODUCTS GROUP CORPORATION AND SUBSIDIARIES

                                Table of Contents

PART I.........................................................................1
     Item 1. Business..........................................................1
          The Company..........................................................1
          Intellectual Property And Product Lines..............................1
          Strategies...........................................................3
          Market Overview......................................................4
          Competition..........................................................5
          Raw Materials and Suppliers..........................................5
          Customers............................................................5
          Seasonality..........................................................5
          Employees............................................................6
          Regulatory Concerns..................................................6
          Environmental Matters................................................6
          Risk Factors.........................................................6
     Item 2. Property.........................................................15
     Item 3. Legal Proceedings................................................15
     Item 4. Submission of Matters to a vote of Security Holders..............15
PART II.......................................................................15
     Item 5. Market for Registrant's Common Equity, Related Stockholder
               Matters and Issuer Purchases of Equity Securities..............15
     Item 6. Management's Discussion and Analysis of Financial Condition
               and Results of Operation.......................................16
          Overview............................................................16
          Major Customers And Suppliers.......................................17
          Going Concern.......................................................17
          Trends And Uncertainties In Regulation And Government
            Policy In China...................................................18
          Critical Accounting Policies And Estimates..........................19
          Results Of Operations...............................................20
          Liquidity And Capital Resources.....................................22
          Inflation And Currency Matters......................................23
          Commitments And Contingencies.......................................24
          Off-Balance Sheet Arrangements......................................24
          Recent Accounting Pronouncements....................................24
     Item 7. Financial Statements.............................................25
          Independent Auditors' Report........................................25
          Consolidated Balance Sheets.........................................26
          Consolidated Statements of Operations...............................27
          Consolidated Statement of Stockholders' Equity (Deficiency).........28
          Consolidated Statements of Cash Flows...............................29
          Notes to Consolidated Financial Statements..........................30
     Item 8. Changes in and Disagreements With Accountants on
               Accounting and Financial Disclosure............................42
     Item 8A. Controls and Procedures.........................................42
     Item 8B. Other Information...............................................42
PART III......................................................................42
     Item 9.  Directors, Executive Officers, Promoters and Control Persons;
                Compliance With Section 16(a) of the Exchange Act.............42
     Item 10. Executive Compensation..........................................42
     Item 11. Security Ownership of Certain Beneficial Owners and
                Management And Related Stockholder Matters....................42
     Item 12. Certain Relationships and Related Transactions..................42
     Item 13. Exhibits........................................................43
          Exhibits............................................................43
     Item 14. Principal Accounting Fees and Services..........................45
SIGNATURES....................................................................45


                                       -i-
<PAGE>

                                     PART I

Item 1. Business

The Company

Kiwa Bio-Tech Products Group Corporation develops, manufactures, distributes and
markets innovative,  cost-effective and environmentally  safe  bio-technological
products for agriculture,  natural resources and environmental conservation. Our
products  are  designed to enhance the quality of human life by  increasing  the
value,   quality  and   productivity   of  crops  and  decreasing  the  negative
environmental impact of chemicals and other wastes.

We are the result of a reverse  merger  between  Tintic Gold Mining  Company,  a
corporation  originally  incorporated  in the State of Utah on June 14,  1933 to
perform  mining  operations in Utah,  and Kiwa Bio-Tech  Products  Group Ltd., a
company  originally  organized  under the laws of the British  Virgin Islands on
June 5, 2002.  The merger was  accomplished  on March 12,  2004,  pursuant to an
Agreement and Plan of Merger dated as of March 11, 2004 by and among Tintic Gold
Mining  Company,   TTGM   Acquisition   Corporation,   a  Utah  corporation  and
wholly-owned  subsidiary  of  Tintic  Gold  Mining  Company,  and Kiwa  Bio-Tech
Products  Group  Ltd.  Pursuant  to  the  Agreement  and  Plan  of  Merger  TTGM
Acquisition  Corporation  merged with and into Kiwa Bio-Tech Products Group Ltd.
Each share of Kiwa Bio-Tech  Products Group Ltd. common stock was converted into
1.5445839 shares of Tintic Gold Mining Company Common Stock,  with Kiwa Bio-Tech
Products  Group Ltd.  surviving  as Tintic  Gold Mining  Company's  wholly-owned
subsidiary.  The wholly-owned  subsidiary thereafter merged with the parent. The
merger  resulted  in a change of control of Tintic  Gold  Mining  Company,  with
former Kiwa Bio-Tech Products Group Ltd.  stockholders owning  approximately 89%
of Tintic  Gold  Mining  Company on a fully  diluted  basis.  Subsequent  to the
merger,  Tintic Gold Mining Company  changed its name to Kiwa Bio-Tech  Products
Group  Corporation.  On July 22, 2004, we completed our  reincorporation  in the
State of Delaware.

In 2002,  Kiwa Bio-Tech  Products Group Ltd.  chartered  Kiwa Bio-Tech  Products
(Shandong)  Co.  Ltd., a  wholly-owned  subsidiary  organized  under the laws of
China,  as its  offshore  manufacturing  base to  capitalize  on low cost,  high
quality  manufacturing  advantages  available in China.  In October  2003,  Kiwa
Bio-Tech   Products  Group  Ltd.   completed   Phase  I   construction   of  its
state-of-the-art manufacturing facility in Shandong Province, China. In November
2003,  Kiwa Bio-Tech  Products Group Ltd.  began  shipping its first  commercial
product, a bio-fertilizer, to the agricultural market in China. We are currently
working on existing  product  improvement and new product  development  while we
continue our three-phase facility build-up.

Intellectual Property And Product Lines

Our goal is to build a platform to commercialize  bio-technological research and
development   results  for   applications  in  agriculture   and   environmental
protection.  In this respect, we are working on developing  cooperative research
relationships  with several  universities in China and the United States. We are
also acquiring technologies to reduce research and development costs and shorten
commercialization  cycles.  Specifically,  on April 12, 2004, we entered into an
agreement with China  Agricultural  University to acquire  Chinese patent no. ZL
93101635.5 entitled "Highly Effective Composite Bacteria for Enhancing Yield and
the Related Methodology for Manufacturing"  from China Agricultural  University.
The aggregate purchase  consideration under the agreement was $480,411, of which
$30,205 was paid in cash at signing of the agreement  and an additional  $30,206
was paid in December 2004. In addition,  as part of the purchase price we issued
1,000,000 shares of common stock to China  Agricultural  University in September
2004,  valued at $0.42 per share based on its fair market value on July 20, 2004
(aggregate  value  $420,000),  which is the date when the transfer of the patent
was approved.

The patent  acquired  from China  Agricultural  University  covers six different
species of bacillus which have been tested as  bio-fertilizers  to enhance yield
and plant health.  The production  methods of the six species are also patented.
The patent will  expire on  February  9, 2013.  We plan to utilize the patent to
develop a new series of products that will  complement our current  products and
create a comprehensive  product  pipeline.  There are no limitations  under this
agreement on our  exclusive use of the patent.  Pursuant to our  agreement  with
China  Agricultural  University,  the University  agreed to provide research and
technology  support  services at no additional cost to us in the event we decide
to use the patent to produce commercial products.  These research and technology
support services include (1) furnishing faculty or graduate-level researchers to
help  bacteria  culturing,  sampling,  testing,  trial  production  and  formula


                                      -1-
<PAGE>

adjustment;  (2)  providing  production  technology  and  procedures to turn the
products into powder form while keeping live required  bacteria in the products;
(3) establishing  quality  standards and quality control systems;  (4) providing
testing and research  support for us to obtain  necessary  sale permits from the
Chinese government; and (5) cooperation in developing derivative products. China
Agricultural  University  has been providing some of these services since August
2004.  If the  University  fails to provide any of these support  services,  our
remedy  against the  University  would be to bring a breach of contract suit for
damages.

In addition,  we may file patent  applications in China and or the United States
for  technologies  we  are  currently  developing  related  to  applications  of
photosynthesis  bacteria,  biologic  catalyst,  and  synergetic  enzymes.  These
technologies  have  applications  in the  agricultural,  natural  resources  and
environmental  conservation  and drug  manufacturing  sectors.  We also  plan to
explore acquisition of similar technologies both in China and the United States.
In addition, our broad plan includes launching our products in the United States
and other markets, introducing new products, creating formal strategic alliances
with selected United States companies to co-develop and/or co-market products in
the United States and China, and forming an international biotechnology research
center in China for the research and development of agricultural,  environmental
and medical applications.

We currently have two commercial products.  Our first commercial product,  based
on  the  photosynthesis   bacteria  technology,   is  a  bio-fertilizer   called
Photosynthesis Biological Catalyst. This product is distributed and sold in both
powdered and liquid  forms.  The powdered  form of this  bio-fertilizer  is sold
under the ZHIGUANGYOU trademark. This product has fifteen different formulas for
different  types of crops,  mainly  including  grain crops,  economic row crops,
leafy  vegetables,  fruits,  and ornament  plants.  The products  work as foliar
bio-fertilizer to help increase agricultural  production yield and improve plant
quality by raising  the  photosynthetic  capacity of plants and  increasing  the
capacity to absorb  nutrition  from the soil. We began  shipping this product in
November 2003. We will target all major agricultural provinces in China over the
next 18 months.  The liquid form of the  Photosynthesis  Biological  Catalyst is
sold under the PUGUANGFU trademark.  We started to offer this series of products
in April  2004 to target  lower-end  markets  mainly in our local  region in the
Shandong Province of China. The liquid form of the product is used as foliar and
as soil-applied  bio-fertilizer.  We currently have a temporary license from the
Chinese Agriculture Department to sell this product series and expect to receive
a permanent license shortly.

Field tests conducted by Chinese  government and research  institutions over the
past three years have  confirmed  that the  Photosynthesis  Biological  Catalyst
product stimulates plant growth and increases crop yields, including vegetables,
fruits and other economic plants, by 10% to 25%.

Our second product is a water  treatment  liquid under the PUGUANGFU  trademark.
This  product  is  used  in  aquaculture  as  a  water  treatment  and  pathogen
suppression agent. We started to offer this product in the Shandong and Jiangshu
Provinces of China in April 2004. We currently have a temporary license from the
Chinese government to sell this product series and expect to receive a permanent
license within the next several months.

Our objective is to market additional  products in the agriculture market in the
next six to twelve months.  These  products will be humus related  products that
can help increase soil fertility and play a vital role in plant nutrition. These
products fall into the following categories:

    1.   Soil  applied  compound  fertilizers  with amino acids and humic acids.
         These products work as a supplementary product to chemical fertilizers.
         We have  applied for a temporary  license in the  Shandong  Province of
         China to sell  these  products  which we expect to  receive in 2005 and
         intend to start commercial sales when we receive the license.

    2.   Soil applied  bio-organic  fertilizer  with  Bacillus  species.  We are
         applying for a sales  license from the Chinese  Agriculture  Department
         and expect to receive the license in the second quarter of 2005 to sell
         these  products.  We will begin selling these  products once we receive
         the license and will target regional markets in China and possibly U.S.
         markets in California, Florida and Texas in 2006.

In addition, we plan to expand the markets for our water-cleansing product based
on the photosynthesis  bacteria technology in the natural resources conservation
market.  We plan to actively  pursue  strategic  alliances  with  bio-technology
companies in the United States to maximize use of our strong  marketing  network
in China's vast agricultural market.


                                      -2-
<PAGE>

Strategies

With the world's  largest  population to feed,  China's demand for  agricultural
products  is  immense.  Problems  with  pollution  and soil  contamination  have
increased  pressure  on the  Chinese  government  to  conserve  land and enhance
environmental  protection.  China thus faces an urgent need to improve unit land
yield and reduce pollution. We plan to address this need through the development
of our  ag-biotechnology  products which increase  agricultural  productivity in
environmentally friendly ways. To capture this opportunity,  our core strategies
are as follows:

o     Build a platform for world-class biotechnological research and development
      results to be commercialized into products for applications in
      agriculture, natural resources conservation and environmental protection;

o     Invest in mature technologies that will not require large amounts of
      research expense to develop into commercial products;

o     Establish strategic alliances for research and development, sales and
      distribution and customer acquisition with complimentary entities in the
      biological-agriculture and natural resources conservation industry;

o     Complete our manufacturing facility in Shandong Province, one of the
      largest agricultural provinces in China;

o     Enhance overall management systems, operational structure and corporate
      governance; and

o     Utilize proprietary technology to produce bacillus series products at
      lower costs than our competitors.

Our sales strategy involves utilizing both a direct sales force and distribution
networks. Our distribution efforts are expected to include the following:

o     Leveraging government support and existing rural area distribution
      networks to more effectively reach end-users;

o     Cooperating with special fertilizer distributors who also help farmers
      resell their products;

o     Focusing on large-to-medium size wholesalers of farm fertilizers at
      provincial and municipal levels;

o     Establishing a three-level distribution network consisting of a company
      centralized sales office, prefectural representative office and direct
      distributors in villages and towns; and

o     Leveraging existing sales channel network of affiliates' products to save
      costs of building the network from scratch.

We plan to target major agricultural companies and growers as customers that can
realize significant financial benefits from using our products including:

o     High value crop (such as fruits and vegetables) growers in China that
      supply major cities;

o     Agricultural producers in China who export to Japanese, Korean and other
      regional markets; and

o     "Green" or organic growers of produce throughout the world.

Given the global trend of customers  favoring  environmentally  safe organically
grown food and growers' needs for higher crop yields and better quality, we also
foresee strong market needs in the United States and other international markets
including  East and  Southeast  Asia. We are  currently  exploring  entering the
California  and Florida  markets in the United  States,  where farmers grow more
"green" or organic high value crops such as fruits and  vegetables.  We are also
in discussions  with  fertilizer  manufacturers  and  distributors  in Taiwan to
distribute our products in the Taiwanese market and to other distributors in the
Southeast Asian markets.

In addition, we also have on-going talks with universities in the United States,
such as the  University  of  California at Riverside and at Davis as well as the
University of Wisconsin,  and universities in China, such as China  Agricultural
University, Nanjing Agricultural University and Shandong University, pursuant to
which we are exploring relationships for research and development projects.


                                      -3-
<PAGE>

Market Overview

Modern agricultural  practices largely rely on heavy use of chemical fertilizers
and pesticides  which cause  tremendous harm to the environment and soils.  Such
practices  have been under  increasing  scrutiny  across  the world,  leading to
consumer  demand  for  agricultural  practices  that  are  more  environmentally
friendly.  China has only 9.1%(1) of the world's  agricultural land but needs to
feed over  1.2(2)  billion  people,  or  approximately  21.1%(3)  of the world's
population.  To  increase  the  overall  crop  yield,  farmers in China use vast
amounts of chemical  fertilizers.  According to the China Statistics  Bureau and
the Food & Agriculture  Organization of the United Nations,  the use of chemical
fertilizers  in China  increased  64.2%(4) in the past decade and  accounted for
one-third of total world fertilizer  consumption (5). Long-term excessive use of
chemical  fertilizers  in  China  has  led  to  severe  soil  contamination  and
pollution.  If the situation continues unchanged,  the largest population in the
world could potentially face severe food and water shortages and an increasingly
polluted living environment.

One solution to the environmental  problem is  bio-fertilizer,  an environmental
friendly fertilizer.  China's current consumption of bio-fertilizer  consists of
only  2.3%(6)  of  the  total  fertilizer  consumption  in  China.  The  Chinese
agricultural industry has started to recognize the importance of bio-fertilizers
to sustainable long-term agriculture in China. Our first commercialized product,
Photosynthesis Biological Catalyst, capitalizes on this market trend and we hope
to become one of the leaders in developing  green  technologies  for productive,
more sustainable agriculture in China.

In the year 2004, we had exports to Cambodia of approximately US$600,000.  Other
than that, our main markets were in China, primarily in the following geographic
provinces:

o     Shandong Province - where our manufacturing facility is based and its
      products are tested. This province is a significant agricultural market
      and close to the Japanese and Korean markets; and

o     Jiangsu and Zhejiang Provinces - two large provinces that are close to
      Shanghai. Currently, we have entered into an exclusive distribution
      arrangement with one of the largest fertilizer and related product
      distributors in Jiangsu Province which is distributing our series of
      products to the local farmers.

In 2005, with continuous  expansion of the current market, our sales efforts are
focused on Jilin Province,  Henan Province,  and Guangdong  Province,  the three
largest  agricultural  provinces  in  terms of grain  yield or  aquatic  product
export. At the same time, several new special fertilizers for special crops will
be put on the market in 2005. For example,  we are  optimistic  that our special
fertilizer  for tobacco  will  approved by and entered  into the List of Special
Fertilizer for Tobacco published by the China Tobacco Bureau.

(1)  Total area of cultivated  land of China is 127,082,000  hectares - as cited
     on page 385 in "China Statistical Yearbook" published by National Bureau of
     Statistics of China (September  2002).  Total area of world cultivated land
     is  1,401,700,000  hectares - as cited on page 17 in  "Summary  of Food and
     Agricultural   Statistics   2003"   published  by  Food  and   Agricultural
     Organization of the United Nations (2003).
(2)  Calculated  based  on  data  published  in  "China  Statistical   Yearbook"
     published by National Bureau of Statistics of China (September  2002), page
     927.
(3)  Calculated  based on data  published  in the "China  Statistical  Yearbook"
     published by National Bureau of Statistics of China (September  2002), page
     927.
(4)  Calculated  based on data  published  in the "China  Statistical  Yearbook"
     published by National Bureau of Statistics of China (September  2002), page
     389.
(5)  Calculated  based on data published in "Current  Agriculture  Situation and
     Chemical Fertilizer Demand in China," by Gao Xiangzhao,  Ma Shangbao and Du
     Sen, published by Science Publication House (July 2004), page 73.
(6)  Bio-fertilizer  production  and  consumption  of 1,000,000  metric tons, as
     cited on page 1 of "  Bio-Fertilizer  Present  and  Future," by Linfeng Li,
     published  by  Jiangxi   Agricultural   University.   Aggregate  fertilizer
     consumption  of  43,390,000  metric  tons,  as cited on page 73 of "Current
     Agriculture  Situation  and  Chemical  Fertilizer  Demand in China," by Gao
     Xiangzhao,  Ma Shangbao and Du Sen, published by Science  Publication House
     (July 2004).


                                      -4-
<PAGE>

Competition

Due  to  the  unique  products  that  we  offer  and  very  early  stage  of the
bio-fertilizer  market in China,  we believe there is little direct  competition
for our products in the Chinese marketplace.  We may experience competition from
existing  products  that are  similar  to  Photosynthesis  Biological  Catalyst.
Management  believes that we have product  differentiation  and cost  advantages
(cost to  customer)  as  compared  to these  products  that  will  enable  us to
outperform  our  competitors,  in  terms  of  profitability,  for the  following
reasons, among others:

o     High effectiveness in increasing crop yield and quality while being
      environmentally friendly;

o     Lower price point and higher return on investment to end users;

o     Powder-based form making transportation and storage easier; and

o     Complimentary to existing use of chemical fertilizer which will help to
      minimize switching costs for end users.

We have conducted detailed research and analysis of the competitive landscape in
the marketplace. From a broader view, there are about 10 companies, in different
stages and of varied sizes of  operations,  which have or are producing  similar
photosynthesis related, microbial bio-fertilizer products in China, according to
the categorization  records from the Agriculture Fertilizer License Authority in
China. The products of these companies are all in liquid form.

In addition, we face competition from large chemical fertilizer manufacturers in
China, such as Sino-Arabic  Chemical  Fertilizer Company, in national markets as
well as Red Sun Group in Shandong and Jiangsu markets. These chemical fertilizer
manufacturers have provided chemical fertilizers to farmers in China for several
years and customers are more accustomed to using their  established  products as
compared to our products.

Raw Materials and Suppliers

The  major  raw   materials   for   photosynthetic   bacteria   production   are
photosynthetic  bacteria,  sodium acetate,  glucose,  diammonium phosphate,  and
dipotassium  hydrogen  phosphate.  Other  chemicals  are also used in the growth
media.  These materials are either cultured by our technicians or purchased from
local  markets.  The key raw  materials  used in  production of our products are
widely  available from a wide variety of supply sources.  Historically,  we have
not  experienced  any  difficulty  in  procuring  adequate   quantities  of  raw
materials.

Three suppliers  accounted for 49.2%,  27.6%,  and 4.1% of our net purchases for
the fiscal year ended  December 31, 2004.  These  suppliers are Beijing  Kailida
Technology Trading Co., Beijing  Wenming-Xinke  Science and Technology Ltd., and
Sichuan Fenghe Enterprise,  respectively.  Historically these suppliers have met
our needs.  In addition,  the raw  materials  used in our products are available
from a variety of alternative sources.

We do not have agreements with our suppliers due to the availability of numerous
suppliers  who have the  ability to supply  our raw  materials  on fairly  short
notice.  We  currently  maintain  a list of 160  qualified  suppliers.  We place
purchase orders when we need supplies.

Customers

Brix Resources Inc., Zhongzheng Agriculture-Technology Product Promotion Co. and
Beijing Kailida Technology Trading Co. accounted for 46.1%, 26.3% and 18.5% of
our net sales for the fiscal year ended December 31, 2004, respectively. No
other single customer accounted for more than 10% of our revenues.

Seasonality

We expect that our operating  results will be subject to seasonal  trends.  This
trend is  dependent  on  numerous  factors,  including  the  markets in which we
operate,  growing  seasons,  climate,  economic  conditions  and numerous  other
factors beyond our control.  Generally,  we expect the second and third quarters
will be  stronger  than the first and fourth  quarters,  primarily  because  the
second and third  quarters  correspond  with the growing  seasons in our primary
markets in China.  It is during those growing  seasons when  application  of our
products by our  customers  would be most  beneficial  and we  therefore  expect
greater demand for our products during those periods.  There can be no assurance
that these  operating  patterns will occur.  But we will seek to develop markets
outside  of China  such as  South-east  Asia in order to  reduce  the  impact of
seasonality.


                                      -5-
<PAGE>

Employees

We  currently  employ 69  full-time  employees  in China and three in the United
States.  We also have 43  seasonal  employees  in China.  We  believe  our labor
relations are good and our turnover rate is relatively low.

Regulatory Concerns

Our  production  needs to  follow  bio-fertilizer  and  photosynthetic  bacteria
standard  production and testing  procedures  issued by the Chinese  Ministry of
Agriculture.  We comply  with the  applicable  standard  production  and testing
procedures.

Environmental Matters

The bacteria used in our products are  naturally  occurring in many water bodies
and have  been  extensively  tested  for  environmental  safety.  They have been
recognized as group  beneficiary  bacteria  that can digest small  inorganic and
organic  molecules for water cleaning and other water treatment  purposes.  They
are  environmentally  friendly  and are not  known  to cause  any  environmental
problems.

Risk Factors

We  operate  in a market  environment  that is  difficult  to  predict  and that
involves  significant risks and uncertainties,  many of which will be beyond our
control.  The  following  risk  factors and other  information  included in this
Annual  Report  should be  carefully  considered.  The  risks and  uncertainties
described  below  are  not  the  only  ones  we  face.   Additional   risks  and
uncertainties  not presently  known to us or that we currently  deem  immaterial
also may impair our business  operations.  If any of the following  risks occur,
our business,  financial  condition,  operating results, and cash flows could be
materially adversely affected.

(1) RISKS RELATED TO OUR BUSINESS

INVESTORS MAY NOT BE ABLE TO  ADEQUATELY  EVALUATE OUR BUSINESS DUE TO OUR SHORT
OPERATING  HISTORY,  LACK OF SIGNIFICANT  REVENUE AND LIMITED PRODUCT OFFERINGS.
DUE TO THIS SHORT OPERATING  HISTORY,  WE HAVE NOT YET GENERATED ANY PROFITS AND
WILL REQUIRE ADDITIONAL FUNDING TO IMPLEMENT OUR BUSINESS PLAN. IN ADDITION,  WE
HAVE BEEN THE SUBJECT OF A GOING  CONCERN  EXPLANATORY  PARAGRAPH.  FOR THE YEAR
ENDED DECEMBER 31, 2004 FROM OUR INDEPENDENT ACCOUNTANTS.

We have only been operating our current business  (ag-biotechnology)  since June
2002,  providing a limited period for investors to evaluate our business  model.
Because  of this  limited  operating  history  and the  uncertain  nature of the
rapidly  changing  markets that we serve,  we believe any  prediction  of future
results of operations is difficult.  We have  generated  insignificant  revenue,
have not been  profitable,  and incurred net operating  losses during our recent
operating history. From the inception of our current business (ag-biotechnology)
on June 5, 2002 to December 31, 2004, we had  accumulated  losses of $4,154,796.
We expect to continue to have operating losses for the foreseeable  future as we
further our  research  and continue to conduct  product  tests.  We will require
additional capital to implement our business plan and continue operating. To the
extent that we are unable to  successfully  raise the capital  necessary to fund
our future cash  requirements on a timely basis and under  acceptable  terms and
conditions,  we will not have sufficient cash resources to maintain  operations,
and  may  have  to  curtail   operations  and  consider  a  formal  or  informal
restructuring or reorganization.

We currently have two commercial  product  lines, a  bio-fertilizer  and a water
treatment and pathogen suppression agent, and plan to market additional products
in the  agriculture  market  in the next six to twelve  months.  There can be no
assurances  that any of the  intellectual  property or  products  intended to be
developed by us will be marketed  successfully or that ultimately we can develop
a sufficiently large production  capacity and sufficiently large customer demand
to operate on a profitable  basis.  In addition,  we are  generally  required to
obtain a license from the China Agriculture Department,  which can take three to
six months,  prior to selling a new product in China. Until sufficient cash flow
is generated from operations,  we will have to utilize our capital  resources or
external  sources of funding to satisfy our working capital needs.  Furthermore,
our prospects must be evaluated in light of risks,  uncertainties,  expenses and
difficulties frequently encountered by companies in an early growth stage.


                                      -6-
<PAGE>


Our  independent  auditors  have added an  explanatory  paragraph to their audit
opinion  issued in connection  with our financial  statements for the year ended
December 31, 2004, which states that the financial  statements raise substantial
doubt as to our ability to continue as a going concern. As of December 31, 2004,
we had accumulated net losses of $4,154,796 and had negative  working capital of
$55,630. Our ability to make operations  profitable or obtain additional funding
will determine our ability to continue as a going concern.

Notwithstanding  this,  the Company  believes that the following  facts diminish
going-concern doubts:

o     In the fiscal year ended December 31, 2004, our only wholly-owned
      subsidiary, Kiwa Bio-Tech Products (Shandong) Co. Ltd. generated net
      income equal to $210,133, taking into account a non-recurring cost of
      $1,417,434 related to the reverse merger.

o     We generated $1.3 million in sales during fiscal 2004 from sales of our
      two products in three China provinces and in Cambodia. We believe the
      Company is well-positioned to increase sales of these products and to
      generate revenue from the introduction of new products in 2005.

OUR BUSINESS IS SUBJECT TO SEASONAL FLUCTUATIONS.

See Seasonality in Item 1.

OUR  OPERATING  RESULTS  MAY  FLUCTUATE  SIGNIFICANTLY,   WHICH  MAY  RESULT  IN
VOLATILITY OR HAVE AN ADVERSE EFFECT ON THE MARKET PRICE OF OUR COMMON STOCK.

We have experienced, and expect to continue to experience, substantial variation
in our net sales and operating results from quarter to quarter.  Our business is
subject to seasonal fluctuations due to growing seasons in different markets. We
believe the  factors  that  influence  this  variability  of  quarterly  results
include:

o     the timing and size of orders from major customers;

o     budgeting and purchasing cycles of customers;

o     the timing of enhancements to products or new products introduced by us or
      our competitors;

o     changes in pricing policies made by us, our competitors or suppliers,
      including possible decreases in average selling prices of products in
      response to competitive pressures; and

o     fluctuations in general economic conditions.

We may also  choose to reduce  prices or to  increase  spending  in  response to
competition or to pursue new market  opportunities.  Due to  fluctuations in our
revenue and operating expenses, we believe that period-to-period  comparisons of
our results of operations are not a good  indication of our future  performance.
It is possible  that in some future  quarter or quarters our  operating  results
will be below the  expectations  of securities  analysts or  investors.  In that
case, our stock price could fluctuate significantly or decline.

From January 1, 2003 to December 31, 2004, the market price for our common stock
as quoted on the OTC Bulletin Board has ranged from $0.06 to $0.90 (adjusted for
stock  splits).  High  volatility  in the market  price of our common  stock may
result in lower prices for our common stock,  making it more difficult for us to
obtain equity financing on terms and conditions which are favorable to us, if at
all. We expect to continue to incur  losses in the near future as we develop and
market our initial  products.  As a result,  we will be dependent on  additional
debt or  equity  financing  to fund our  operations.  If such  financing  is not
available on terms which are acceptable to us, we may have to delay  development
of new  products  and/or  reduce  sales and  marketing  efforts for our existing
products.  Such actions may have an adverse effect on our results of operations.
In  addition,  uncertainties  with  respect to our  ability to raise  additional
capital would make operational planning more difficult for management.


                                      -7-
<PAGE>

REVOCATION  OF OUR RIGHT TO USE PATENTS OR OTHER  INTELLECTUAL  PROPERTY  RIGHTS
COULD ADVERSELY IMPACT THE GROWTH OF OUR BUSINESS.

We acquired a patent in April 2004 from China  Agricultural  University,  titled
"Highly  Effective  Composite  Bacteria  for  Enhancing  Yield  and the  Related
Methodology  for  Manufacturing,"  issued  by the  China  Intellectual  Property
Bureau.  While  we do  not  yet  have  any  commercial  products  utilizing  the
technology  covered by this  patent,  we plan to use the patent to develop a new
series of products  that will  compliment  our current  products.  If our rights
under this  patent are  challenged  or if we  default on our  obligations  under
applicable Chinese regulatory  requirements,  our right to use that patent could
be  revoked  and we would no  longer  be  permitted  to use that  patent  in our
research,  development and sales activities.  Such a revocation or default could
have  an  adverse  impact  on  the  growth  of  our  business  by  reducing  the
introduction of new products, and consequently, sales.

OUR SUCCESS  DEPENDS IN PART ON OUR SUCCESSFUL  DEVELOPMENT AND SALE OF PRODUCTS
CURRENTLY IN THE RESEARCH AND DEVELOPMENT STAGE.

We currently  have two  commercial  products  based on  photosynthesis  bacteria
technology.  The  first is a  bio-fertilizer  called  Photosynthesis  Biological
Catalyst and the second is a water treatment and pathogen  suppression agent. We
commenced  sales of a powdered  form of  Photosynthesis  Biological  Catalyst in
November 2003 and a liquid form in April 2004.  We commenced  sales of our water
treatment  and  pathogen  suppression  agent in April 2004.  Many of our product
candidates  are still in the  research and  development  stage.  The  successful
development  of new products is uncertain and subject to a number of significant
risks.  Potential  products  that  appear  to be  promising  at early  states of
development may not reach the market for a number of reasons,  including but not
limited to, the cost and time of development. Potential products may be found to
be  ineffective  or  cause  harmful  side  effects,  fail to  receive  necessary
regulatory  approvals,  be  difficult  to  manufacture  on a large  scale  or be
uneconomical or fail to achieve market  acceptance.  Our failure to successfully
develop and sell new products may delay or eliminate  future  acquisition  plans
and would most likely slow our  development.  Our plans to introduce  additional
proprietary products may not be realized as expected, if at all.

There can be no assurance that any of our intended products will be successfully
developed or that we will achieve  significant  revenues from such products even
if they are successfully developed. Our success is dependent upon our ability to
develop and market our  products on a timely  basis.  There can be no  assurance
that we will be successful  in  developing or marketing  such products or taking
advantage of the perceived demand for such products.  In addition,  there can be
no assurance that products or  technologies  developed by others will not render
our  products  or   technologies   non-competitive   or   obsolete.   The  China
bio-fertilizer market is still in a very early stage and is very fragmented with
many  potential  customers,  but  with no  single  producer  or  small  group of
producers  dominating  the  market.  To  some  extent,  however,  we  also  face
competition  from large  chemical  fertilizer  manufacturers  in China,  such as
Sino-Arabic  Chemical  Fertilizer Company in national markets as well as Red Sun
Group in Shandong and Jiangsu markets.  These chemical fertilizer  manufacturers
have  provided  chemical  fertilizers  to farmers in China for several years and
customers are more accustomed to using their established products as compared to
new products.

FAILURE TO ADEQUATELY  EXPAND TO ADDRESS  EXPANDING MARKET  OPPORTUNITIES  COULD
HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS AND RESULTS OF OPERATIONS.

We  anticipate  that a significant  expansion of operations  will be required to
address potential market opportunities.  There can be no assurances that we will
expand our operations in a timely or sufficiently  large manner to capitalize on
these market  opportunities.  The anticipated  substantial growth is expected to
place  a  significant  strain  on  our  managerial,  operational  and  financial
resources and systems. While management believes it must implement,  improve and
effectively  use  our   operational,   management,   research  and  development,
marketing,  financial  and  employee  training  systems  to  manage  anticipated
substantial  growth,  there can be no assurances  that these  practices  will be
successful.

OUR  SUCCESS  DEPENDS  IN PART  UPON OUR  ABILITY  TO  RETAIN  AND  RECRUIT  KEY
PERSONNEL.

Our success is highly  dependent  upon the  continued  services of our executive
officers,  key  product  development  personnel  and key  scientific  personnel,
including  without  limitation,  Wei Li, Da chang Ju,  Lian jun Luo,  James Nian
Zhan, Dr. Daniel Qu, Jing hong Zhang,  Professor Qi Wang,  Feng jun Ding,Yu hong
Pang, and Professor Gui sheng Chen. Given the intense  competition for qualified
management and product  development  personnel in our industry,  the loss of the
services  of  any  key   management   or  product   development   personnel  may
significantly and detrimentally  affect our business and prospects.  We maintain
employment  agreements with two of our key personnel in China:  Lian jun Luo and
Qu Bin. The material terms of these  employment  agreements  include  three-year


                                      -8-
<PAGE>

terms,   provision  for  annual   bonuses  and  stock  option  grants  based  on
performance,  and severance of three month's base salary if these executives are
laid off without  cause.  We do not have  employment  agreements  with any other
members of management or key personnel. While we have not experienced difficulty
in attracting and maintaining  key personnel,  there can be no assurance that we
will be able to retain these personnel,  and it may be time consuming and costly
to recruit qualified replacement personnel.

WE CURRENTLY DO NOT HAVE SUFFICIENT  REVENUES TO SUPPORT OUR BUSINESS ACTIVITIES
AND, IF OPERATING LOSSES CONTINUE, WE WILL REQUIRE ADDITIONAL FINANCING WHICH WE
MAY NOT BE ABLE TO SECURE.

We require substantial working capital to fund our business.  In the short term,
we plan to continue building out our manufacturing facility,  adjust our product
formula to improve product stability and optimize our product offerings,  expand
our sales and marketing efforts in China, expand our distribution base in China,
introduce new products,  and acquire 2 to 3 small or medium sized bio-technology
companies in the Chinese  agricultural and/or  environmental  markets.  Over the
next 24 months, we estimate that we will require  approximately $2.5 million for
completion  of  construction  of  our   manufacturing   facility  and  equipment
investment,  $1 million to  consummate  our  planned  acquisitions,  $600,000 in
working capital and $500,000 in administrative and operations  expenses.  In the
long  term,  we plan to  become a  commercialization  platform  for  world-class
biotechnological   research  and   development   results  for   applications  in
agriculture, natural resources conservation and environmental protection, launch
our products in the United States and other markets,  continue our  introduction
of new products,  create formal strategic  alliances with selected United States
companies  to  co-develop  and/or  co-market  products in the United  States and
China, and form an international  biotechnology research center in China for the
research   and   development   of   agricultural,   environmental   and  medical
applications.

Because we  currently  do not have  sufficient  revenues to support our business
activities  and  we  expect  operating  losses  to  continue,  we  will  require
additional  capital  to  fund  our  operations  and  finance  our  research  and
development  activities.  Funding,  whether from a public or private offering of
debt or equity, a bank loan or a collaborative  agreement,  may not be available
when  needed  or on  favorable  terms.  If we are  unable  to  obtain  necessary
financing in the amounts and on terms deemed  acceptable,  we may have to limit,
delay, scale back or eliminate our research and development activities or future
operations. Any of the foregoing may adversely affect our business.

ENTERING  INTO EQUITY OR DEBT  FINANCINGS  COULD  RESULT IN DILUTION TO EXISTING
STOCKHOLDERS.

We will be  required  to raise  additional  capital to fund our  operations  and
finance our  research  and  development  activities  through a public or private
offering of debt or equity. Any equity financing could result in dilution to the
existing stockholders as a direct result of our issuance of additional shares of
our capital stock.  Debt financings  will result in interest  expense and likely
subject us to negative  covenants that would limit our operational  flexibility,
and if convertible into equity, could also dilute then-existing stockholders.

THE RISKS ASSOCIATED WITH RAISING CAPITAL THROUGH  COLLABORATIONS  AND LICENSING
AGREEMENTS COULD ADVERSELY AFFECT OUR BUSINESS.

We will be  required  to raise  additional  capital to fund our  operations  and
finance our research and development  activities  through  collaborative  and/or
licensing  agreements.  Under  these  agreements,  we may be  subject to various
restrictive   covenants  which  could  significantly  limit  our  operating  and
financial  flexibility  and may limit our  ability  to respond to changes in our
business  or  competitive  environment.  If we are  unable to  obtain  necessary
financing in the amounts and on terms deemed  acceptable,  we may have to limit,
delay, scale back or eliminate our research and development activities or future
operations. Any of the foregoing may adversely affect our business.

RESTRICTIONS ON CURRENCY  EXCHANGE MAY LIMIT OUR ABILITY TO EFFECTIVELY  RECEIVE
AND USE OUR REVENUE.

Because  almost  all of our  future  revenues  may be in the  form of  Renminbi,
China's currency which is denominated  RMB, any future  restrictions on currency
exchanges may limit our ability to use revenue generated in Renminbi to fund our
business  activities outside China or to make dividend or other payments in U.S.
Dollars. Although the Chinese government introduced regulations in 1996 to allow
greater  convertibility  of  the  Renminbi,  for  current  account  transactions
significant  restrictions still remain, including primarily the restriction that
foreign invested  enterprises may only buy, sell and/or remit foreign currencies


                                      -9-
<PAGE>

at those banks authorized to conduct foreign  exchange  business after providing
valid  commercial  documents.  In addition,  conversion  of Renminbi for capital
account items, including direct investment and loans, is subject to governmental
approval in China,  and  companies  are required to open and  maintain  separate
foreign  exchange  accounts for capital account items. We cannot be certain that
the Chinese regulatory  authorities will not impose more stringent  restrictions
on the  convertibility  of the  Renminbi,  especially  with  respect  to foreign
exchange transactions.

We  may  also  be  subject  to  foreign  exchange  risk  and  foreign  ownership
restrictions.  The  Chinese  government  is  loosening  its  control  on foreign
exchange  transactions.  More liberal foreign exchange  policies will reduce our
foreign  exchange  risk by  increasing  the  liquidity of revenues  generated in
Renminbi.  We do anticipate  conducting  operations in any countries  other than
China and the United States over the next  twenty-four  months.  Fluctuations in
the exchange rate of the Renminbi  relative to the U.S.  Dollar could  adversely
affect our results of  operations  by affecting  our  reported  earnings for any
given period. In addition,  foreign ownership restrictions could also impact our
ability to expand our business through investment and acquisition opportunities.
If we are unable to pursue such strategic opportunities due to foreign ownership
regulations, the growth of our business could be limited.

CHANGES IN CHINA'S POLITICAL, SOCIAL, ECONOMIC OR LEGAL SYSTEMS COULD MATERIALLY
HARM OUR BUSINESS.

All of our  manufacturing  and production and the majority of our sales occur in
China. Consequently, an investment in our common stock may be adversely affected
by the political,  social and economic  environment in China.  Under its current
leadership,  China has been pursuing  economic  reform  policies,  including the
encouragement    of   private    economic    activity   and   greater   economic
decentralization.   There  can  be  no  assurance,  however,  that  the  Chinese
government  will  continue to pursue such  policies,  that such policies will be
successful if pursued,  or that such policies will not be significantly  altered
from time to time.

Our business and prospects are dependent upon agreements and regulatory approval
with various  entities  controlled  by Chinese  governmental  instrumentalities.
Historically,  our  operations  in  China  have  received  relatively  favorable
treatment from these  instrumentalities  as a result of the Chinese government's
policies of  encouraging  economic  development  and  innovation,  especially in
underdeveloped   regions.   However,  our  operations  and  prospects  would  be
materially  and  adversely  affected by a change in China's  economic  policies,
which could make it more  difficult for us to obtain  necessary  approvals  from
governmental  authorities  and to obtain economic  incentives from  governmental
authorities.  In addition, if the Chinese government elects not to honor certain
contracts  as a result of  political  change,  it might be  difficult to enforce
these contracts  against such governmental  entities in China. In addition,  the
legal  system  of  China  relating  to  foreign  investments  is  both  new  and
continually  evolving,  and  currently  there  can  be no  certainty  as to  the
application of its laws and regulations in particular instances.

A  SLOW-DOWN  IN THE  CHINESE  ECONOMY  MAY  ADVERSELY  EFFECT  OUR  GROWTH  AND
PROFITABILITY.

The growth of the Chinese economy has been uneven across geographic  regions and
economic  sectors.  There can be no assurance that growth of the Chinese economy
will be  steady or that any  recessionary  conditions  will not have a  negative
effect on our  business.  Several  years ago,  the Chinese  economy  experienced
deflation,  which may reoccur in the  foreseeable  future.  In  addition,  if an
outbreak  of SARS  recurs,  it may cause a  decrease  in the  level of  economic
activity and may adversely  affect economic growth in China,  Asia and elsewhere
in the world.  The  performance  of the  Chinese  economy  overall  affects  our
profitability  as  expenditures  for  agricultural  technological  products  may
decrease due to slowing domestic demand.

OUR ABILITY TO GENERATE  REVENUES  COULD SUFFER IF THE CHINESE  AG-BIOTECHNOLOGY
MARKET DOES NOT DEVELOP AS ANTICIPATED.

The agriculture-biotechnology market in China, the primary market in which we do
business,  is in the early  stages of  development.  While we believe the market
opportunity  looks promising,  we expect that the market will take several years
to develop.  While it is difficult  to project  exactly how long it will take to
develop the ag-biotechnology  industry in China, we anticipate that it will take
at least  ten  years to reach a level of  development  which is  similar  to the
current state of the industry in the United  States.  Successful  development of
the ag-biotechnology market in China depends on the following:

o     continuation  of  governmental  and  consumer  trends  favoring the use of
      products and technologies designed to create sustainable agriculture;

o     educating the Chinese agricultural  community and consumers about the uses
      of ag-biotechnology products; and

o     certain  institutional  developments  such  as  governmental  agricultural
      subsidies  designed  to  promote  the  use  of  environmentally   friendly
      ag-biotechnological products.


                                      -10-
<PAGE>

There are no assurances that these trends will continue,  governmental subsidies
will be offered, or that the Chinese  agricultural  community and consumers will
be  successfully  educated  about  the uses of  ag-biotechnology  products.  The
conduct of business in the  ag-biotechnology  market involves high risks.  There
can be no  assurances  that the  ag-biotechnology  market in China will  develop
sufficiently  to facilitate our profitable  operation.  While we believe that we
will  benefit  from our  first-mover  advantage  in a growing  market,  existing
competitors  and new  entrants in the  ag-biotechnology  market are  expected to
create fierce  competition in the future as the market evolves.  Competitors and
new entrants may introduce  new products into the market that may  detrimentally
affect sales of our existing products,  and consequently our revenues. We intend
to fund operations  through sales, debt and equity financings until such time as
the  ag-biotechnology  market in China is sufficiently  developed to support our
profitable operation.

WE MAY NOT BE ABLE TO ADEQUATELY  PROTECT OUR INTELLECTUAL  PROPERTY RIGHTS, AND
MAY BE EXPOSED TO INFRINGEMENT CLAIMS FROM THIRD PARTIES.

Our success will depend in part on our ability to obtain patent  protection  for
our technology,  to preserve our trade secrets and to operate without infringing
on  the  proprietary  rights  of  third  parties.  We  have  several  trademarks
registered in China,  which will be protected by the trademark laws in China for
ten years and are  renewable at the  expiration of the initial ten year term. In
addition,  we have recently acquired a China patent from the China  Agricultural
University entitled "Highly Effective Composite Bacteria for Enhancing Yield and
the  Related  Methodology  for  Manufacturing,"  issued  by  China  Intellectual
Property Bureau, which has a remaining term of eight years.

We may also file patents with China Intellectual Property Bureau and/or the U.S.
Patent and Trademark  Office as we deem  appropriate.  There can be no assurance
that the  patents  applied for will be  reviewed  in a timely  manner,  that any
additional  patents  will be  issued  or that any  patents  issued  will  afford
meaningful  protection  against  competitors with similar technology or that any
patents  issued will not be  challenged by third  parties.  There also can be no
assurance  that  others will not  independently  develop  similar  technologies,
duplicate  our  technologies  or design around our  technologies  whether or not
patented.  There also can be no assurance that we will have sufficient resources
to maintain a patent infringement  lawsuit should anyone be found or believed to
be infringing  our patents.  There also can be no assurance  that the technology
ultimately used by us will be covered in any additional patent applications that
we may file.  We do not  believe  that our  technology  infringes  on the patent
rights of third parties. However, there can be no assurance that certain aspects
of our technology will not be challenged by the holders of other patents or that
we will not be required to license or otherwise  acquire from third  parties the
right to use additional  technology.  The failure to overcome such challenges or
obtain such licenses or rights on acceptable terms could have a material adverse
affect on us, our business, results of operations and financial condition.

The processes and know-how of importance to our  technology  are dependent  upon
the skills, knowledge and experience of our technical personnel, consultants and
advisors and such skills,  knowledge and experience are not patentable.  To help
protect our rights, we require employees,  significant  consultants and advisors
with  access to  confidential  information  to enter  into  confidentiality  and
proprietary rights agreements.  There can be no assurance,  however,  that these
agreements will provide adequate  protection for our trade secrets,  know-how or
proprietary  information  in the event of any  unauthorized  use or  disclosure.
There  can be no  assurance  that we will be able to  obtain a  license  for any
technology  that we may require to conduct our business or that, if  obtainable,
such technology can be licensed at a reasonable  cost. The cost of obtaining and
enforcing patent protection and of protecting proprietary technology may involve
a  substantial  commitment  of our  resources.  Any such  commitment  may divert
resources from other areas of our  operations.  We may be required to license or
sublicense certain technology or patents in order to commence operations.  There
can be no assurance that we will be able to obtain any necessary  licenses or to
do so on satisfactory  terms. In addition,  we could incur  substantial costs in
defending  ourselves  against suits brought by other parties for infringement of
intellectual  property  rights and there are no assurances that we will have the
resources to do so.

WE MAY BECOME INVOLVED IN INTELLECTUAL PROPERTY LITIGATION, THE DEFENSE OF WHICH
COULD ADVERSELY IMPACT OUR BUSINESS OPERATIONS.

Currently  we have  one  patent  in  China  (Patent  Number  ZL93  101635.5  and
International  patent  classification  Number  A01N  63/00),  which  covers  six
different  species of  bacillus  which have been  tested as  bio-fertilizers  to
enhance  yield and plant  health as well as the  production  methods  of the six
species. The patent will expire on February 19, 2013.


                                      -11-
<PAGE>

While we have not received any allegations,  complaints or threats of litigation
relating to any intellectual  property rights, we may, from time to time, become
involved in litigation regarding patent and other intellectual  property rights.
From time to time,  we may  receive  notices  from third  parties  of  potential
infringement and claims of potential infringement.  Defending these claims could
be costly and time  consuming and would divert the  attention of management  and
key personnel  from other  business  issues.  The  complexity of the  technology
involved and the uncertainty of intellectual  property litigation increase these
risks.  Claims of intellectual  property  infringement  also might require us to
enter into costly royalty or license  agreements.  However,  we may be unable to
obtain  royalty or license  agreements on terms  acceptable to us, or at all. In
addition,  third parties may attempt to appropriate the confidential information
and proprietary technologies and processes used in our business, which we may be
unable to prevent and which would harm the businesses and our prospects.

WE FACE TECHNICAL RISKS  ASSOCIATED WITH  COMMERCIALIZING  OUR TECHNOLOGY  WHICH
COULD HAVE A MATERIAL ADVERSE IMPACT ON OUR BUSINESS RESULTS AND OPERATIONS.

A key to our future  success is the  ability to produce our  bacillus  series of
products  at  lower  costs  than  our  competitors.  Although  we are  currently
utilizing  our  proprietary  technology to produce such products at lower costs,
our method for producing  such products on a commercial  basis has only recently
begun.  Further,  although results from recent  independent  tests and our early
production  results  have been  encouraging,  the ability of our  technology  to
commercially   produce  such  products  at  consistent  levels  is  still  being
evaluated. There can be no assurance that we will continue to be able to produce
such products at lower costs than our competitors,  nor that our technology will
be able to commercially produce such products at consistent levels.

WE DEPEND ON A FEW CUSTOMERS FOR A SIGNIFICANT PORTION OF OUR REVENUE.

Three customers - Brix Resources Inc., Zhongzheng Agriculture-Technology Product
Promotion Co., Beijing Kailida  Technology  Trading Co. - together accounted for
approximately  90.9% of our net sales for the  fiscal  year ended  December  31,
2004. The loss of any of our  significant  customers  would result in a material
reduction  in our sales and  results  of  operations.  We do not have  long-term
contracts  with  any  of  our  customers.   Purchases   generally  occur  on  an
order-by-order  basis, and  relationships  exist as long as there is a perceived
benefit to both parties.  A decision by a major customer,  whether  motivated by
competitive considerations,  financial difficulties,  and economic conditions or
otherwise,  to decrease its  purchases  from us or to change its manner of doing
business with us, could adversely  affect our business and financial  condition.
There can be no  assurances  that we will be able to retain  these  customers or
further  expand our customer base to reduce our  dependence on a small number of
customers.  Our inability to generate new customers could negatively  impact our
business and our ability to continue as a going concern.

WE HAVE LIMITED BUSINESS INSURANCE COVERAGE.

The  insurance  industry  in China is still in its early  stage of  development.
Insurance companies in China offer limited business  insurance.  As a result, we
do not  have any  business  liability  insurance  coverage  for our  operations.
Moreover,  while business disruption insurance is available,  we have determined
that the risks of  disruption  and cost of the insurance are such that we do not
require it at this time. Any business disruption, litigation or natural disaster
might result in substantial costs and diversion of resources.

(2) RISK RELATED TO OUR COMMON STOCK

IF AN ACTIVE TRADING MARKET FOR OUR SECURITIES DOES NOT REMAIN IN EXISTENCE, THE
MARKET PRICE OF OUR  SECURITIES MAY DECLINE AND  STOCKHOLDERS'  LIQUIDITY MAY BE
REDUCED.

Although our common stock is quoted on the OTC Bulletin Board, a regular trading
market for the securities  may not be sustained in the future.  The OTC Bulletin
Board is an inter-dealer,  over-the-counter  market that provides  significantly
less liquidity than the NASD's  automated  quotation  system.  Quotes for stocks
included on the OTC Bulletin  Board are not listed in the financial  sections of
newspapers  as are those for the  NASDAQ  Stock  Market.  Therefore,  prices for
securities  quoted  solely on the OTC Bulletin  Board may be difficult to obtain
and holders of common stock may be unable to resell their  securities at or near
their original  purchase price or at any price.  As of December 31, 2004, we had
379 stockholders of record. As of December 31, 2004, the closing price per share
of common  stock was $0.06 and the  average  daily  trading  volume for the last
three months in 2004 was 80,479 shares.  Market prices for our common stock will
be influenced by a number of factors, including:


                                      -12-
<PAGE>

o     the issuance of new equity securities;

o     changes in interest rates;

o     competitive  developments,  including  announcements by competitors of new
      products or services or  significant  contracts,  acquisitions,  strategic
      partnerships, joint ventures or capital commitments;

o     variations in quarterly operating results;

o     change in financial estimates by securities analysts;

o     the depth and liquidity of the market for our common stock;

o     investor  perceptions  of our  company and the  ag-biotechnology  industry
      generally; and

o     general economic and other conditions.

WE ARE CONTROLLED BY TWO EXISTING  STOCKHOLDERS  WHO POSSESS  SUFFICIENT  VOTING
POWER TO  PREVENT  OR  FRUSTRATE  ATTEMPTS  TO  REPLACE  OR REMOVE  OUR  CURRENT
MANAGEMENT OR TO ENGAGE IN CHANGE OF CONTROL TRANSACTIONS.

Our principal  stockholders are All Star Technology Inc. and InvestLink  (China)
Limited.  Wei Li, our Chief  Executive  Officer  and  Chairman,  is a  principal
shareholder of All Star Technology Inc. Da chang Ju, one of our directors,  is a
principal  stockholder of InvestLink (China) Limited.  All Star Technology Inc.,
together  with  InvestLink   (China)   Limited,   currently   beneficially   own
approximately 54.8% of the outstanding shares of our common stock.  Accordingly,
All Star Technology Inc.,  together with InvestLink  (China) Limited,  currently
have the ability to determine the outcome of any corporate  transaction or other
matter  submitted  to the  stockholders  for  approval,  including  election  of
directors,  mergers,  consolidations and the sale of all or substantially all of
our assets.  Our principal  stockholders  will also have the power to prevent or
cause a change in control.  The interests of these  stockholders may differ from
other stockholders' interests.

THE  DESIGNATION  OF OUR COMMON STOCK AS "PENNY  STOCK" COULD IMPACT THE TRADING
MARKET FOR OUR COMMON  STOCK DUE TO  BROKER-DEALER  REQUIREMENTS  IMPOSED BY THE
DESIGNATION OF OUR COMMON STOCK AS "PENNY STOCK."

Our common  stock is a "penny  stock" as defined in Rules  15g-2  through  15g-6
promulgated  under  Section  15(g) of the  Securities  Exchange Act of 1934,  as
amended, as it meets the following definitions:  (i) the stock trades at a price
less than $5.00 per  share;  (ii) it is not  traded on a  "recognized"  national
exchange;  (iii) it is not quoted on the NASDAQ Stock Market, or even if so, has
a price  less than  $5.00 per  share;  and (iv) is issued by a company  with net
tangible  assets less than $2.0  million,  if in business more than a continuous
three  years,  or with  average  revenues of less than $6.0 million for the past
three years.  The principal result or effect of being designated a "penny stock"
is that securities  broker-dealers  cannot recommend the stock but must trade in
it on an unsolicited basis.

Section 15(g) of the Securities Exchange Act of 1934, as amended, and Rule 15g-2
promulgated  thereunder  by  the  Securities  and  Exchange  Commission  require
broker-dealers  dealing in penny stocks to provide  potential  investors  with a
document  disclosing  the risks of penny stocks and to obtain a manually  signed
and dated written receipt of the document before  effecting any transaction in a
penny stock for the investor's account.

Potential  investors  in our  common  stock are  urged to  obtain  and read such
disclosure  carefully before  purchasing any shares that are deemed to be "penny
stock." Moreover,  Rule 15g-9 requires broker-dealers in penny stocks to approve
the account of any investor for  transactions  in such stocks before selling any
penny stock to that investor.  This procedure  requires the broker-dealer to (i)
obtain from the investor information  concerning his or her financial situation,
investment  experience and investment  objectives;  (ii)  reasonably  determine,
based on that  information,  that  transactions in penny stocks are suitable for
the investor and that the investor has sufficient knowledge and experience as to
be reasonably capable of evaluating the risks of penny stock transactions; (iii)
provide the investor with a written  statement  setting forth the basis on which
the  broker-dealer  made the  determination  in (ii) above;  and (iv)  receive a
signed and dated copy of such  statement from the investor,  confirming  that it
accurately reflects the investor's  financial situation,  investment  experience
and investment  objectives.  Compliance with these requirements may make it more
difficult  for  holders  of our  common  stock to resell  their  shares to third
parties or to otherwise dispose of them in the market or otherwise.


                                      -13-
<PAGE>

PROVISIONS IN OUR CHARTER AND THE  CORPORATE  LAW OF OUR STATE OF  INCORPORATION
COULD DETER OR PREVENT AN ACQUISITION OR CHANGE OF CONTROL.

Provisions of our certificate of incorporation  may deter or prevent a change in
control of management. Specifically, our certificate of incorporation allows our
Board of Directors to issue 20,000,000 shares of preferred stock, in one or more
series and with such rights and  preferences  including  voting rights,  without
further  stockholder  approval.  In  the  event  that  the  Board  of  Directors
designates  additional  series of preferred  stock with rights and  preferences,
including  super-majority  voting rights,  and issues such preferred  stock, the
preferred  stock could make our  acquisition by means of a tender offer, a proxy
contest  or  otherwise,  more  difficult,  and could  also make the  removal  of
incumbent officers and directors more difficult.  As a result,  these provisions
may  have  an  anti-takeover  effect.  The  preferred  stock  authorized  in our
certificate of incorporation may inhibit changes of control.

In  addition,  we are subject to the  provisions  of Section 203 of the Delaware
General  Corporation Law. That section  provides,  with some exceptions,  that a
Delaware  corporation  may  not  engage  in any of a  broad  range  of  business
combinations with a person or affiliate,  or associate of the person,  who is an
"interested  stockholder"  for a period  of three  years  from the date that the
person became an interested stockholder unless: (i) the transaction resulting in
a person becoming an interested  stockholder,  or the business  combination,  is
approved by the Board of Directors of the corporation  before the person becomes
an interested stockholder;  (ii) the interested stockholder acquires 85% or more
of the outstanding  voting stock of the corporation in the same transaction that
makes it an interested  stockholder,  excluding  shares owned by persons who are
both officers and directors of the corporation, and shares held by some employee
stock  ownership  plans;  or (iii) on or after the date the  person  becomes  an
interested   stockholder,   the   business   combination   is  approved  by  the
corporation's  Board of Directors  and by the holders of at least 66 2/3% of the
corporation's  outstanding  voting  stock  at  an  annual  or  special  meeting,
excluding   shares  owned  by  the   interested   stockholder.   An  "interested
stockholder"  is defined  as any person  that is (a) the owner of 15% or more of
the outstanding voting stock of the corporation or (b) an affiliate or associate
of the corporation  and was the owner of 15% or more of the  outstanding  voting
stock of the  corporation at any time within the three-year  period  immediately
prior to the date on which it is sought to be  determined  whether the person is
an interested stockholder.

These  provisions  could  also limit the price that  future  investors  might be
willing to pay in the future for our common stock. This could have the effect of
delaying,  deferring or  preventing a change in control of our Company  and/or a
change in the members our Board of  Directors.  The issuance of preferred  stock
could also  effectively  limit or dilute the voting  power of our  stockholders.
Accordingly,  such provisions of our certificate of  incorporation,  as amended,
may  discourage or prevent an  acquisition  or  disposition of our business that
could otherwise be in the best interest of our shareholders.

INVESTORS  SHOULD NOT RELY ON AN  INVESTMENT  IN OUR COMMON  STOCK FOR  DIVIDEND
INCOME AS WE DO NOT INTEND TO PAY DIVIDENDS IN THE FORESEEABLE FUTURE.

We do not  anticipate  paying  any cash  dividends  on our  common  stock in the
foreseeable  future.  We intend to retain any  earnings to finance the growth of
our  business.  We  cannot  assure  you that we will  ever  pay cash  dividends.
Therefore,  investors  should not rely on an  investment  in our common stock if
they require  dividend  income.  The only income in the foreseeable  future such
investors  will  receive from an  investment  in our common stock will come from
increases in the market price of our common  stock.  There can be no  assurances
that the market price of our common stock will increase or continue to increase,
and such increases will most likely be uncertain and  unpredictable.  Whether we
pay any cash  dividends  in the future will depend on the  financial  condition,
results  of  operations  and  other  factors  that the Board of  Directors  will
consider.

IT MAY BE  DIFFICULT  FOR  INVESTORS  TO ENFORCE A SERVICE OF PROCESS OR ENFORCE
LIABILITIES AGAINST US.

We are  incorporated  in the  State of  Delaware,  and our  principal  executive
offices are located in the State of California.  However,  substantially all our
fixed assets and  operations are located in the People's  Republic of China.  In
addition, some of our directors and officers are Chinese citizens and residents.
As a result,  it may be more  difficult  for investors or other third parties to
attach  our  assets  in  enforcement  of a  judgment  against  us or to  enforce
liabilities and obligations against us in certain circumstances.  It may also be
difficult to enforce service of process against directors and officers in China.


                                      -14-
<PAGE>

Item 2. Property

In June 2002 the Company  entered  into an  agreement  with  Zoucheng  Municipal
Government granting the Company use of at least 15.7 acres in Shandong Province,
China at no cost for 10 years to construct a manufacturing  facility.  Under the
agreement,  the  Company has the option to pay a fee of $58,696 per acre for the
land use right at the  expiration  of the  10-year  period.  The Company may not
transfer or pledge the  temporary  land use right.  In the same  agreement,  the
Company has also  committed to invest  approximately  $18 million to $24 million
for developing the manufacturing and research  facilities in Zoucheng,  Shandong
Province.  As of December 31, 2004, the Company had invested  approximately $1.4
million  for the  project.  Management  believes  that  neither  the Company nor
management  will  be  liable  for  compensation  or  penalty  if the  investment
commitment  is not  fulfilled.  As of December  31,  2004,  the first phase of a
three-phase construction plan has been completed and production has begun in the
completed  facility.  The production  capacity of the completed  facility is 600
tons of bio-organic  product.  We will continue on to Phase II  construction  to
expand the capacity to 1,000 tons in 2005 when we are able to secure financing.

We lease our principal  executive  offices  located at 17700  Castleton  Street,
Suite 589, City of Industry, California 91748. The lease has a term of two years
and expires on June 11, 2005. We currently  expect that we will renew this lease
prior to its expiration.

We also lease an office in Beijing  under an operating  lease  expiring in April
2005 with an aggregate monthly lease payment of approximately  $2,882. We do not
expect to renew  this  lease  when it  expires  and are  negotiating  terms with
another landlord.

Item 3. Legal Proceedings

None.

Item 4. Submission of Matters to a vote of Security Holders

None.

                                     PART II

Item 5. Market for Registrant's  Common Equity,  Related Stockholder Matters and
        Issuer Purchases of Equity Securities.

The Company's common stock is quoted on the OTC Bulletin Board of the NASD under
the symbol  "KWBT.OB"  from  March 30,  2004,  and was  quoted  under the symbol
"TTGM.OB"  before the merger in March 2004 described  previously  under Item 1.,
"Business - The Company." During 2004, the market price for our common stock has
ranged from $0.06 to $0.75 (adjusted for stock splits).

The  following  table sets forth the high and low  closing  sale  prices for our
common stock as reported on the OTC Bulletin Board for the periods indicated:

-------------------------------------------- -------------------- --------------
                Fiscal 2003                         High                Low
-------------------------------------------- -------------------- --------------
First Quarter (commencing 01/01/03)                 0.90               0.20
Second Quarter                                      0.50               0.50
Third Quarter                                       0.50               0.50
-------------------------------------------- -------------------- --------------
Fourth Quarter                                      0.50               0.50


                                      -15-
<PAGE>

-------------------------------------------- -------------------- --------------
                Fiscal 2004                         High               Low
-------------------------------------------- -------------------- --------------
First Quarter (commencing 01/01/04)                 0.50               0.12
Second Quarter                                      0.75               0.32
Third Quarter                                       0.45               0.09
-------------------------------------------- -------------------- --------------
Fourth Quarter                                      0.10               0.06

The  foregoing  prices take into  account the 1-for-4  stock split of our shares
that occurred during the first quarter of 2004.

As of December 31,  2004,  there were 379  shareholders  of record of our common
shares.  We have not paid any dividends on our common shares since our inception
and do not  anticipate  that dividends will be paid at any time in the immediate
future.

Item 6. Management's  Discussion and Analysis of Financial Condition and Results
        of Operation.

This report on Form 10-KSB for the fiscal year ended  December 31, 2004 contains
"forward-looking" statements within the meaning of Section 21E of the Securities
and  Exchange Act of 1934,  as amended,  including  statements  that include the
words  "believes",  "expects",  "anticipates",  or  similar  expressions.  These
forward-looking  statements  include,  among others,  statements  concerning our
expectations regarding our working capital requirements, financing requirements,
business,  growth  prospects,  competition and results of operations,  and other
statements of expectations,  beliefs,  future plans and strategies,  anticipated
events or  trends,  and  similar  expressions  concerning  matters  that are not
historical facts. The  forward-looking  statements in this report on Form 10-KSB
for the fiscal year ended  December  31, 2004 involve  known and unknown  risks,
uncertainties and other factors that could cause our actual results, performance
or achievements  to differ  materially from those expressed in or implied by the
forward-looking statements contained herein.

Overview

Our business plan is to develop, manufacture,  distribute and market innovative,
cost-effective  and  environmentally  safe  bio-technological  products  for the
agricultural,  natural  resources and environmental  protection  markets located
primarily in China.  We intend to improve  existing  products and to develop new
products.   Our  activities  to  date  have  included  conducting  research  and
development,  acquiring and developing  intellectual property,  raising capital,
developing a manufacturing  facility,  identifying  strategic  acquisitions  and
marketing our products. Our first product, a photosynthesis biological catalyst,
was  introduced in China's  agricultural  market in November  2003. We generated
$1.3 million in revenue from planned principal operations in fiscal 2004.

The Company took its present form in March 2004 when Tintic Gold Mining Company,
a Utah public  corporation,  merged with Kiwa  Bio-Tech  Products  Group Ltd., a
privately-held  British Virgin  Islands  corporation.  (See previous  discussion
under  "Item  1.  Business  -  The  Company.").  For  accounting  purposes  this
transaction  was  treated  as  an  acquisition  of  the  public  company  and  a
recapitalization  of Kiwa  Bio-Tech  Products  Group Ltd.  and its wholly  owned
subsidiary, Kiwa Bio-Tech Products (Shandong) Co., Ltd (reverse merger). On July
22, 2004, we completed our reincorporation in the State of Delaware.

On April  12,  2004,  we  entered  into an  agreement  with  China  Agricultural
University to acquire  patent Number ZL 93101635.5  entitled  "Highly  Effective
Composite  Bacteria  for  Enhancing  Yield  and  the  Related   Methodology  for
Manufacturing,"  which was originally  granted by the People's Republic of China
Intellectual  Property Bureau on July 12, 1996.  There are no limitations  under
this  agreement  on our  exclusive  use of the  patent.  The  patent  covers six
different  species of  bacillus  which have been  tested as  bio-fertilizers  to
enhance yield and plant health.  The  production  methods of the six species are
also patented.  The patent will expire on February 9, 2013. The Company plans to
utilize  the patent to  develop a new series of  products  that  complement  its
current  products  and create a  comprehensive  product  pipeline.  We expect to
invest $500,000  (included in  manufacturing  facility  construction and working
capital  spending  plans)  to  complete  the  patent's   commercialization   and
anticipate  generating between $1 million to $1.5 million in annual revenue from
commercial products under the patent in each of the next five to eight years.


                                      -16-
<PAGE>

Pursuant to our agreement  with China  Agricultural  University,  the University
agreed to provide research and technology support services at no additional cost
to us in the event we decide to use the patent to produce  commercial  products.
These research and technology support services include (1) furnishing faculty or
graduate-level researchers to help with bacteria culturing,  sampling,  testing,
trial production and formula adjustment; (2) providing production technology and
procedures  to turn the products  into powder form while  keeping  required live
bacteria in the products; (3) establishing quality standards and quality control
systems;  (4) providing  testing and research support for us to obtain necessary
sale permits from the Chinese  government;  and (5)  cooperation  in  developing
derivative  products.  China Agricultural  University has been providing some of
these  services  since August 2004.  If the  University  fails to provide any of
these support  services,  our remedy against the University  would be to bring a
breach of contract suit for damages.

Major Customers And Suppliers

Three  customers  accounted for 46.1%,  26.3% and 18.5% of our net sales for the
fiscal year ended December 31, 2004. No other single customer accounted for more
than  10% of our  revenues.  The  revenue  from  Chinese  and  South-East  Asian
customers  accounted  for 53.9% and 46.1% of  sales,  respectively.  During  the
fiscal year ended December 31, 2004, the total number of customers  increased 10
fold,  and our revenue was 31.5 times the  revenue  generated  during the fiscal
year ended  December 31, 2003.  This increase is  attributable  to the fact that
2004 was our first full year of production. We generated revenue of $40,031 from
two customers in the fourth  quarter of the fiscal year ended December 31, 2003.
These sales were made  possible by  completion  of Phase I  construction  of our
production  facility  in 2003 and  launch  of our  first  product  to  market in
November 2003.

Three suppliers  accounted for 49.2%,  27.6%,  and 4.1% of our net purchases for
the fiscal year ended  December  31,  2004.  Our total  purchases  increased  to
$526,897 during fiscal year 2004 compared with $143,393 in fiscal year 2003.

Going Concern

Our consolidated  financial  statements have been prepared assuming that we will
continue as a going concern,  which  contemplates  the realization of assets and
the  satisfaction of liabilities in the normal course of business.  The carrying
amounts  of assets  and  liabilities  presented  in the  consolidated  financial
statements do not purport to represent the realizable or settlement  values.  We
incurred a net loss of $2,728,673 and  $1,355,239  during the fiscal years ended
December 31, 2004 and 2003,  respectively,  and our current liabilities exceeded
our  current  assets by $55,630  and  $585,313  at  December  31, 2004 and 2003,
respectively.  In  addition,  we are  still in an early  growth  stage  and will
require  additional  capital  to fund our  business  plan.  Furthermore,  we are
continuing  to  develop  our  manufacturing  facility  and  have  not  generated
significant revenues from our operations. These factors create substantial doubt
about our ability to continue as a going concern.

As of December 31, 2004,  we had obtained  non-interest  bearing  loans from the
Chinese  local  government  of  approximately  $1,510,264.  Among  these  loans,
$120,821 was received from a local science bureau in Shandong  Province,  China.
The Company repaid $60,411 of such loan during 2004, and the local bureau agreed
to waive the remaining  balance.  Accordingly,  the remaining balance of $60,411
was recorded as other income.  Other loans require us to begin  repayment of the
outstanding  balance of the loans,  approximately  $1,389,443  in the first year
after our Chinese subsidiary reaches an accumulative profit position. The entire
balance is to be fully repaid within three years thereafter.

In the fiscal year ended  December 31, 2004, our only  wholly-owned  subsidiary,
Kiwa  Bio-Tech  Products  (Shandong)  Co.  Ltd.  generated  net income  equal to
$210,133.

We  generated  $1.3  million in sales  during  fiscal 2004 from sales of our two
products in three China  provinces  and in  Cambodia.  We believe the Company is
well-positioned to increase sales of these products and to generate revenue from
the introduction of new products in 2005.

In 2005, we intend to raise  additional  capital through the issuance of debt or
equity  securities to fund the development of our planned  business  operations,
although there can be no assurances that we will be successful in obtaining this
financing.  To the extent that we are unable to  successfully  raise the capital
necessary  to fund our  future  cash  requirements  on a timely  basis and under
acceptable  terms and conditions,  we will not have sufficient cash resources to
maintain operations, and may have to curtail operations and consider a formal or
informal restructuring or reorganization.


                                      -17-
<PAGE>

Trends And Uncertainties In Regulation And Government Policy In China

AGRICULTURAL POLICY CHANGES IN CHINA

After over ten years of economic  growth,  China now faces an imbalance  between
urban and  rural  environments  as well as the  manufacturing  and  agricultural
industries.  On February 10, 2004, the Chinese central  government  issued a new
policy to correct the imbalance by offering  favorable  taxation of agricultural
products.  Existing  agricultural products will be taxed at a rate of 1%. At the
Central Working  Conference on Agriculture on December 28, 2004, China's central
authorities  pledged to continue  agriculture-friendly  policies,  to  stabilize
upward  trends in grain  production  and to  increase  farmers'  income in 2005,
including further reducing agricultural taxes, increasing financial subsidies to
farmers,  investing more money in rural  infrastructure and increasing financial
assistance  to main  grain-production  counties.  We should  benefit  from these
favorable  policies as farmers  will  retain more of their  income and will most
likely spend some of that income on our products  resulting in greater sales. In
addition,  we anticipate receiving additional  governmental support in marketing
our products to farmers due to additional  procedural  changes included with the
new policy.

GENERAL FISCAL AND MONETARY POLICY CHANGES IN CHINA

In  2004,  China  adopted  restricted  fiscal  and  monetary  policies  to fight
potential  inflation.  However,  "People's Daily", the most popular  state-owned
newspaper  in China,  stated on August 10, 2004 that the  agricultural  area has
been one of a few industries which will continue to enjoy  expansionary  policy.
The  article  noted  that the  Chinese  government  will  continue  to  increase
investment in agricultural development.  We have previously benefited from these
policies,  as evidenced by our receipt of  non-interest  bearing  loans from the
government in the amount of  approximately  $1,510,264 from November 28, 2002 to
December  31,  2004.  As the  government  further  increases  investment  in the
agricultural  area,  we expect that similar loans or other  favorable  financing
programs will be available to us in the future,  which we anticipate will assist
us with  managing  liquidity  and capital  resources  during our growth  period.
However,  if these  financing  programs are not available in the future,  we may
have to borrow on terms which are less favorable to us, or we may not be able to
borrow additional funds at all on terms which are acceptable.

FOREIGN INVESTMENT POLICY CHANGES

The Chinese  government  is  considering  changes to its  currently  policy that
provide  favorable tax treatment to foreign invested  enterprises as compared to
Chinese domestic business.  The new policy under  consideration will consolidate
enterprise  income tax laws between  foreign  invested  enterprises  and Chinese
domestic enterprises. The new policy will also provide transitional arrangements
to facilitate  the  consolidation.  No timetable has been  announced yet for the
consolidation.  If the new  policy is  implemented,  newly  established  foreign
invested  enterprises  will not enjoy favorable tax treatment as in effect under
current tax laws. It is  anticipated  that the proposed  policy will not have an
impact on companies  like ours,  which have already been granted  favorable  tax
treatment.  We believe this beneficial tax status will make an investment in our
Company more attractive to both foreign and domestic  investors in China,  which
could improve our liquidity or provide additional capital resources. However, if
we were to be subject to such new policies, our tax rate and tax liability would
increase.

FOREIGN EXCHANGE POLICY CHANGES

China is considering  allowing its currency to be freely  exchangeable for other
major  currencies.  This change will result in greater  liquidity  for  revenues
generated in Renminbi  ("RMB").  We would benefit by having easier access to and
greater  flexibility with capital  generated in and held in the form of RMB. The
majority  of our  assets  are  located  in China  and most of our  earnings  are
currently  generated in China, and are therefore  denominated in RMB. Changes in
the RMB-U.S. Dollar exchange rate will impact our reported results of operations
and financial condition. In the event that RMB appreciates over the next year as
compared to the U.S. Dollar,  our earnings will benefit from the appreciation of
the RMB.  However,  if we have to use U.S.  Dollars  to  invest  in our  Chinese
operations,  we will suffer from the  depreciation  of U.S.  Dollars against the
RMB. On the other hand, if the value of the RMB were to  depreciate  compared to
the U.S.  Dollar,  then our reported  earnings and financial  condition would be
adversely affected when converted to U.S. Dollars.


                                      -18-
<PAGE>

Critical Accounting Policies And Estimates

We prepared our consolidated  financial statements in accordance with accounting
principles  generally accepted in the United States of America.  The preparation
of these financial statements requires the use of estimates and assumptions that
affect the reported  amounts of assets and  liabilities  and the  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amount of revenues  and  expenses  during the  reporting  period.
Management  periodically  evaluates the estimates and judgments made. Management
bases its  estimates  and  judgments  on  historical  experience  and on various
factors  that are  believed to be  reasonable  under the  circumstances.  Actual
results may differ from these estimates as a result of different  assumptions or
conditions.

The following critical accounting policies affect the more significant judgments
and estimates used in the preparation of our consolidated financial statements.

ACCOUNTS  RECEIVABLE.  We perform ongoing credit evaluations of our customers by
analyzing  historical  bad  debts,  customer  concentrations,   customer  credit
worthiness,  current economic trends and changes in customer  payment  patterns,
and intend to establish an allowance for doubtful  accounts when amounts are not
considered fully collectible or when they are more than 365 days past due.

We believe  that the accounts  receivable  balance at December 31, 2004 is fully
collectible.  Our belief is based on industry  practices in the China region and
those of our competitors,  our ongoing  relationships and our payment experience
with our customers.  As of December 31, 2004, all accounts  receivable were less
than  one  year  old and we have no  indication  of  insolvency  from any of our
customers.

Terms of the sales vary from cash on delivery  through a credit term up to three
to twelve  months.  Ordinarily,  we require our customers to pay between 20% and
60% of the purchase  price of an order  placed,  depending on the results of our
credit  investigations,  prior to shipment.  The remaining balance is due within
twelve  months,  unless  other terms are approved by  management.  We maintain a
policy that all sales are final, we do not allow returns.  However, in the event
of defective products, we may allow customers to exchange the defective products
for  new  products  within  90 days  of  delivery  and  prior  to the  product's
expiration  date.  In  the  event  of  any  exchange,   the  customers  pay  all
transportation expenses.

INVENTORIES.  Inventories  are  stated  at the  lower of cost or net  realizable
value.  Cost is determined on the weighted average method.  Inventories  include
raw materials,  work-in-progress,  finished goods and low-value consumables. Net
realizable  value is the  estimated  selling  price in the  ordinary  course  of
business, less estimated costs to complete and dispose. Management believes that
there is no obsolete inventory.

REVENUE  RECOGNITION.  We recognize  revenue in accordance  with  Securities and
Exchange   Commission  Staff  Accounting  Bulletin  ("SAB")  No.  101,  "Revenue
Recognition  in  Financial  Statements",  as  amended by SAB No.  104,  "Revenue
Recognition").  Sales represent the invoiced value of goods,  net of value added
tax,  supplied  to  customers,  and are  recognized  upon  delivery of goods and
passage of title.

IMPAIRMENT OF ASSETS.  Our  long-lived  assets consist of property and equipment
and  intangible  assets.  At December  31,  2004,  the net value of property and
equipment and intangible assets was $1,255,094 and $463,730, respectively, which
represented approximately 40.1% and 14.8% of our total assets respectively.

We periodically evaluate our investment in long-lived assets, including property
and equipment,  for  recoverability  whenever events or changes in circumstances
indicate the net carrying amount may not be recoverable. Our judgments regarding
potential  impairment  are  based  on  legal  factors,   market  conditions  and
operational performance indicators, among others. In assessing the impairment of
property and equipment,  we make assumptions regarding the estimated future cash
flows and other factors to determine the fair value of the respective assets. If
these  estimates  or the related  assumptions  change in the  future,  we may be
required to record impairment charges for these assets.


                                      -19-
<PAGE>

INCOME TAXES. We record a valuation  allowance to reduce our deferred tax assets
arising from net operating loss  carryforwards to the amount that is more likely
than not to be realized. In the event we were to determine that we would be able
to realize  our  deferred  tax  assets in the  future in excess of our  recorded
amount, an adjustment to the deferred tax assets would be credited to operations
in the period such determination was made. Likewise, should we determine that we
would  not be able to  realize  all or part of our  deferred  tax  assets in the
future,  an adjustment to the deferred tax assets would be charged to operations
in the period such determination was made.

Results Of Operations

TWELVE MONTHS ENDED DECEMBER 31, 2004 AND 2003

NET SALES.  Net sales were  $1,300,251  and $40,031 for the twelve  months ended
December 31, 2004 and 2003,  respectively,  representing an increase of 32 times
the  revenue   generated  during  the  fiscal  year  ended  December  31,  2003.
Introduction of new products and the development of a customer base from the end
of 2003 to 2004 is the basis for the increase in net sales during the period.  A
$599,032 sale to a Cambodia customer in December 2004 accounted for 46.1% of the
total sales in 2004. We had only minimal sales in the fourth quarter of 2003.

COST OF SALES.  Cost of sales were  $641,236  and $30,294 for the twelve  months
ended  December 31, 2004 and 2003 including  depreciation  and  amortization  of
$56,326 and $16,578,  respectively. The increase of $610,942 or 20 times in cost
of sales was  primarily due to increased  material  costs,  which  resulted from
increased sales.

GROSS PROFIT. Gross profit was $659,015 and $9,737, representing a profit margin
of 50.7% and 24.3% for the  twelve  months  ended  December  31,  2004 and 2003,
respectively. This $649,278 (67-fold) increase was due to our increased sales in
2004.

CONSULTING AND PROFESSIONAL FEES. Consulting and professional fees were $448,442
and  $545,787  for  the  twelve  months  ended   December  31,  2004  and  2003,
respectively,  representing  a decrease  of $97,345 or 17.8%.  The  decrease  in
consulting and professional fees in 2004 is primarily attributable to consulting
and  professional  fees relating to the reverse merger in March 2004  separately
listed as reverse  merger cost on the  consolidated  income  statement.  Most of
these fees are  related to  fund-raising,  investor  relations,  public  company
operations and marketing,  including  non-cash costs of $47,750  relating to the
issuance of common stock in September 2004.

DIRECTORS'  COMPENSATION.  Directors' compensation decreased by $269,712 or 348%
to $77,398  for the twelve  months  ended  December  31,  2004,  as  compared to
$347,110  for the same  period  of 2003.  In 2003,  we issued  an  aggregate  of
8,031,836  shares of common stock to compensate  directors  for their  increased
time  commitments  to the Company.  The decrease was due to a change in director
compensation policy following the completion of the reverse merger in 2004.

GENERAL AND ADMINISTRATIVE.  General and administrative expense was $598,492 for
the twelve months ended  December 31, 2004, as compared to $327,501 for the same
period of 2003,  an  increase of  $270,991  or 82.8%,  primarily  as a result of
increased  marketing  expenses  commensurate  with  enhanced  sales  volume  and
increased  personnel-related  costs in China  reflecting  an increased  level of
business  activity and increased  costs  associated with being a public company.
General and administrative expenses include salaries,  travel and entertainment,
rent, office expense, telephone expense and insurance costs, and other marketing
expenses.

RESEARCH AND DEVELOPMENT. Research and development expense decreased by $13,812,
or 21.8%,  to $49,622 for the twelve months ended December 31, 2004, as compared
to $63,434 for the twelve months ended  December 31, 2003.  This decrease is due
to the reduced expenses to field test our products for sales licenses granted in
2004.

DEPRECIATION  AND  AMORTIZATION.   Depreciation  and   amortization,   excluding
depreciation and amortization included in cost of production, increased $34,213,
or 184%, to $52,798 for the twelve  months ended  December 31, 2004, as compared
to $18,585  for the same  period of 2003.  Only six months of  depreciation  was
accrued in 2003 while a full year depreciation was accrued in 2004. Furthermore,
the  addition  of patent and ERP  software  has also  contributed  to  increased
depreciation and amortization in 2004.


                                      -20-
<PAGE>

REVERSE MERGER COSTS.  Reverse merger costs equal to $1,417,434 were incurred in
the first and second quarters of 2004,  including non-cash costs relating to the
issuance of the warrants and options of $1,114,380 to  consultants,  as compared
to $50,336 for the twelve  months  ended  December  31,  2003.  The 2004 reverse
merger costs are non-recurring.

INTEREST INCOME (EXPENSE),  NET. Interest expense increased $91,690, or 750%, to
$103,913 for the twelve months ended  December 31, 2004, as compared to interest
expense  of  $12,223  for the same  period  of  2003.  This  increase  is due to
increased  borrowings in 2004 and the amortization of the intrinsic value of the
detachable  warrants of $44,663  according to a convertible  loan  agreement for
$350,000 entered into on September 23, 2004.

AMORTIZATION OF BENEFICIAL  CONVERSION FEATURE OF CONVERTIBLE NOTES PAYABLE. For
the twelve  months  ended  December  31,  2004,  we  recorded a total  charge of
$700,000 to reflect the beneficial  conversion feature of two convertible loans.
On January 25, 2004, we entered into a convertible  loan agreement for $500,000,
with annualized interest of 12%, payable at maturity.  The loan was scheduled to
mature on  September  25,  2004.  As part of the loan terms,  the lender had the
right to convert the loan into shares of our common  stock at $0.25 per share at
any time prior to the  maturity  date,  subject to our  completion  of a reverse
merger  transaction in the United States,  which was accomplished in March 2004.
On June 8, 2004, the lender converted the $500,000 loan into 2,000,000 shares of
our common stock at the agreed  conversion  price of $0.25 per share. The lender
is an unrelated party located  outside the United States.  The fair value of the
beneficial  conversion  feature of this  convertible  loan was  determined to be
$500,000,  consisting of the aggregate fair value of the difference  between the
$0.25  conversion  price and the fair market  value of our common stock of $0.60
per share,  and was recorded as a reduction to convertible  notes payable and an
interest  expense  from January 25, 2004  through the  conversion  date (June 8,
2004),  which  resulted  in a  charge  to  operations  of  $281,250  before  the
conversion date, and the unamortized deferred interest expense of $218,750 as of
the conversion date was charged to operations as interest expense.

On March 12, 2004,  we entered into a convertible  loan  agreement for $200,000,
with annualized interest of 12%, payable at maturity.  The loan was scheduled to
mature three months after funding. As part of the loan terms, the lender had the
right to convert the loan into shares of our common  stock at $0.25 per share at
any time prior to the  maturity  date,  subject to our  completion  of a reverse
merger  transaction in the United States,  which was accomplished in March 2004.
The loan was not  funded  until  April 7,  2004.  On June 8,  2004,  the  lender
converted  the  $200,000  loan into  800,000  shares of our common  stock at the
agreed  conversion  price of $0.25 per share.  The lender is an unrelated  party
located outside the United States.  The fair value of the beneficial  conversion
feature of this  convertible  loan was determined to be $200,000,  consisting of
the aggregate fair value of the difference  between the $0.25  conversion  price
and the fair  market  value of our  common  stock of $0.60  per  share,  and was
recorded as a reduction to  convertible  notes  payable and an interest  expense
from April 7, 2004 through the conversion date (June 8, 2004), which resulted in
a  charge  to  operations  of  $133,333  before  the  conversion  date,  and the
unamortized  deferred  interest expense of $66,667 as of the conversion date was
charged to operations as interest expense.

OTHER  INCOME.  We had other  income for the period  ended  December 31, 2004 of
$60,411  attributable  to  forgiveness by Zoucheng  Science & Technology  Bureau
(Shandong Province, China) of amounts due on money we borrowed from it in 2003.

NET LOSS.  Net loss  increased  $1,373,434  to $ 2,728,673 for the twelve months
ended  December 31, 2004, as compared to $1,355,239 for the same period of 2003.
The  increased  net loss in 2004 is  primarily  the  result of the  increase  in
reverse  merger costs and the  amortization  of beneficial  conversion  feature,
offset by additional gross profit in 2004.

Liquidity And Capital Resources

Since  inception  of the  ag-biotech  business  in 2002,  we have  relied on the
proceeds from the sale of our equity  securities  and loans from both  unrelated
and related  parties to provide the resources  necessary to fund the development
of our business plan and  operations.  During the fiscal year ended December 31,
2004, we raised  $1,050,000 in the form of three  convertible  notes payable and
obtained a government preferential note of approximately $302,053.

We will require additional capital to fund our business plan, and to develop our
manufacturing  facility and have not  generated  significant  revenues  from our
operations for such  purposes.  In 2005, we intend to raise  additional  capital
through the issuance of debt or equity securities to fund the development of our
planned business operations, although there can be no assurances that we will be
successful in this regard.  There can be no  assurances  that we will be able to
obtain sufficient funds to allow us to continue operations in 2005.


                                      -21-
<PAGE>

In  November  2002 and June 2003,  we  entered  into two bank loans for two auto
purchases  with a local bank in  Beijing,  China in the  amounts of $38,663  and
$25,498,  with  interest  rates of 5.32% and 5.02%,  respectively.  The maturity
dates are October  2007 and March 2008,  respectively.  As of December 31, 2004,
the outstanding balances of these loans were $15,379 and $11,474,  respectively.
We had  short-term  borrowings  of $283,930 as of December 31, 2003,  which were
secured by restricted cash in the form of a bank  certificate of deposit in U.S.
Dollars.  These  borrowings  were  repaid in full during the first six months of
2004.

In October 2003, we entered into a convertible  loan  agreement  with China Star
Investment  Group  pursuant  to which we borrowed  $100,000  from the China Star
Investment  Group.  The loan bears interest at the rate of 12% per annum and was
originally due and payable in October 2004. In May 2004,  China Star  Investment
Group agreed to waive the conversion  right in exchange for  acceleration of the
maturity date to June 30, 2004. The maturity date has been subsequently extended
to August 31, 2005. In July 2004,  we borrowed an additional  $50,500 from China
Star Investment Group under the same loan agreement.  This additional loan bears
interest at a rate of 12% per annum and was  scheduled  to mature on January 26,
2005. The maturity date has been subsequently extended to August 31, 2005. As of
December 31, 2004, the total outstanding  balance to China Star Investment Group
was $112,105.

On January 4, 2005, we issued a promissory note in the original principal amount
of  $400,000 to Cornell  Capital  which will be  automatically  repaid with cash
proceeds from the sale of our common stock under our Standby Equity Distribution
Agreement  unless we elect to pay  earlier  from other  sources.  The note bears
interest  at a rate of 10% per  annum and has a term of 290  days.  For  further
detail see Note 19 to the  Financial  Statements in respect of the note and Note
14 in respect of our Standby Equity Distribution Agreement.

On September 23, 2004, we entered into a loan agreement with two U.S.  citizens,
Young Sam Kim and Song N. Bang, for $350,000 with interest at 10% per annum, and
issued 1,050,000  detachable  warrants.  The warrants are exercisable for common
stock at $0.20 per share and have a  three-year  exercise  period.  The loan was
initially due on March 23, 2005,  but the final  maturity date was  subsequently
extended by agreement to April 21, 2005. Our Chief Executive Officer  personally
guaranteed  the loan and  pledged  shares of our  common  stock  that he owns as
security.

We qualified for non-interest bearing loans under a government sponsored program
to encourage  economic  development  in certain  industries  and  locations.  To
qualify  for the  favorable  loan  terms,  a  company  must  meet the  following
criteria:  (1) be a technology company with innovative technology or product (as
determined  by the  Science  Bureau of the central  government);  (2) operate in
specific industries, such as agriculture,  environmental, education, and others,
which the government has determined important to encourage development;  and (3)
be located in undeveloped  areas such as Zoucheng,  Shandong  Province where our
facility is located.

As of December 31, 2004,  we had obtained  non-interest  bearing  loans from the
Chinese  local  government  of  approximately  $1,510,264.  Among  these  loans,
$120,821  was received  from  Zoucheng  Science & Technology  Bureau in Shandong
Province,  China.  The  Company  repaid  $60,411 of the loan  during  2004,  and
Zoucheng  Science &  Technology  Bureau  forgave  the  payment of the  remaining
balance of $60,411 at the end of 2004, which was recorded as other income. Other
loans require us to begin  repayment of the  outstanding  balance of the loans -
approximately  $1,389,443  - in the  first  year  after our  Chinese  subsidiary
reaches an  accumulative  profit  position.  The  entire  balance is to be fully
repaid within three years thereafter.

At December 31, 2004 and December 31, 2003,  we had cash of $17,049 and $48,730,
respectively.  At December 31, 2004 and 2003, our net working capital deficiency
was $55,630 and $585,313, respectively,  reflecting current ratios of 0.96:1 and
0.53:1, respectively, at such dates.


                                      -22-
<PAGE>

During the fiscal year ended December 31, 2004, our operations  utilized cash of
$1,121,025 as compared to $710,001  utilized for the fiscal year ended  December
31, 2003.  This  increase  was  attributable  to an increased  level of business
activity and costs associated with operating a public company.

During the fiscal year ended December 31, 2004 we utilized $219,645 in investing
activities for the purchase of property and  equipment,  as compared to $925,170
for the fiscal year ended December 31, 2003.

During the fiscal year ended  December 31, 2004,  we generated  $1,308,989  from
financing  activities,  consisting of the proceeds from three  convertible notes
payable of $1,050,000,  decrease in restricted cash of $300,000 and increases in
short-term loan and long-term borrowings of $50,000 and $265,806,  respectively,
offset in part by the  repayment of short-term  and long-term  loans of $283,930
and $72,887  respectively.  During the fiscal year ended  December 31, 2003,  we
generated $1,161,844 from financing activities through an increase in short-term
loans and long-term borrowings.

We  continue  to  develop  our   manufacturing   facility   and  have   invested
approximately $1,397,536 in Phase I of our new manufacturing facility, including
$986,965 in buildings  and  $218,250 in  equipment.  We estimate  that the total
investment  for the completion of Phases II and III of the  construction  of our
manufacturing facility will be at least $2.5 million.

We do not anticipate generating sufficient positive internal operating cash flow
to fund our  planned  operations  until  such  time as we  generate  substantial
revenues, which may take the next few years to fully realize. In 2005, we intend
to raise additional capital through the issuance of debt or equity securities to
fund the development of our planned business  operations,  although there can be
no assurances  that we will be successful in obtaining  this  financing.  To the
extent that we are unable to  successfully  raise the capital  necessary to fund
our future cash  requirements on a timely basis and under  acceptable  terms and
conditions,  we will not have sufficient cash resources to maintain  operations,
and  may  have  to  curtail   operations  and  consider  a  formal  or  informal
restructuring or reorganization.

Inflation And Currency Matters

In the most recent decade, the Chinese economy has experienced  periods of rapid
economic growth as well as relatively high rates of inflation, which in turn has
resulted  in  the  periodic  adoption  by  the  Chinese  government  of  various
corrective  measures  designed to regulate  growth and  contain  inflation.  Our
success depends in substantial  part on the continued  growth and development of
the Chinese economy.

Foreign operations are subject to certain risks inherent in conducting  business
abroad,  including price and currency exchange controls, and fluctuations in the
relative value of currencies.  We conduct virtually all of our business in China
and,  accordingly,  the sale of our  products is settled  primarily in RMB. As a
result,  devaluation or currency  fluctuation of the RMB against the U.S. Dollar
would adversely affect our financial  performance when measured in U.S. Dollars.
Although prior to 1994 the RMB experienced  significant  devaluation against the
U.S. Dollar, the RMB has remained fairly stable since then. In addition, the RMB
is not freely  convertible into foreign  currencies,  and the ability to convert
the RMB is subject to the availability of foreign currencies. Effective December
1, 1998,  all foreign  exchange  transactions  involving the RMB must take place
through  authorized  banks or financial  institutions in China at the prevailing
exchange  rates quoted by the  People's  Bank of China.  The  exchange  rate was
approximately $1.00 to RMB 8.28 at December 31, 2004 and December 31, 2003.

As China has recently been admitted as a member of the World Trade Organization,
the central government of China is expected to adopt a more rigorous approach to
partially  deregulate  currency  conversion  restrictions,  which  may  in  turn
increase the exchange  rate  fluctuation  of the RMB.  Should there be any major
change in the central  government's  currency  policies,  we do not believe that
such an action  would  have a  detrimental  effect on our  operations,  since we
conduct  virtually all of our business in China, and the sale of our products is
settled in RMB.

Commitments And Contingencies

The Company has the following material contractual obligations:


                                      -23-
<PAGE>

Operating  lease  commitments - The Company leases an office in Beijing under an
operating  lease expiring in April 2005 with an aggregate  monthly lease payment
of  approximately  $2,882.  Rent expense under the operating  lease for the year
ended  December  31,  2004 and 2003 was $31,703 and  $27,570,  respectively.  At
December 31, 2004, the Company's  future  minimum lease payments  required under
the operating lease total $11,528 for the four months ending April 30, 2005.

The  Company  leases an office in the United  States  under a  commercial  lease
agreement  expiring  in June 2005 with an  aggregate  monthly  lease  payment of
approximately  $2,560.  Pursuant to the lease  agreement,  the Company paid rent
expenses for the year ended December 31, 2004 of $21,904.

Off-Balance Sheet Arrangements

At December  31, 2004,  we did not have any  relationships  with  unconsolidated
entities  or  financial  partnerships,  such as  entities  often  referred to as
structured   finance  or  special  purpose  entities,   which  would  have  been
established for the purpose of facilitating  off-balance  sheet  arrangements or
other contractually  narrow or limited purposes.  As such, we are not exposed to
any  financing,  liquidity,  market or credit  risk that  could  arise if we had
engaged in such relationships.

Recent Accounting Pronouncements

In September 2004,  Emerging  Issues Task Force ("EITF")  reached a consensus on
EITF Issue No. 04-08 ("EITF  04-08"),  "The Effect of  Contingently  Convertible
Debt on Diluted Earnings per Share".  Under current  interpretations of FASB No.
128, "Earnings per Share", issuers of contingently  convertible debt instruments
("Co-Cos")  generally  exclude the potential common shares underlying the Co-Cos
from the calculation of diluted  earnings per share until the underlying  common
stock achieves a specified price target, or other contingency is met. EITF 04-08
requires  that  Co-Cos  should  be  included  in  diluted   earnings  per  share
computations,  if dilutive,  regardless  of whether the market price trigger has
been met.  We do not  anticipate  that the  adoption  of  EITF04-08  will have a
significant effect on our earnings or financial position.

On October 13, 2004, the Financial  Accounting  Standards  Board ("FASB") issued
Statement  of Financial  Accounting  Standards  ("SFAS") No. 123R,  "Share-Based
Payment", which would require all companies to measure compensation cost for all
share-based  payments (including employee stock options) at fair value, would be
effective for public  companies for interim or annual  periods  beginning  after
June  15,  2005.  We  could  adopt  the new  standard  in one of two ways -- the
modified prospective transition method or the modified retrospective  transition
method. We will adopt SFAS No. 123R in our fourth quarter of fiscal 2005 and are
currently  evaluating the effect that the adoption of SFAS No. 123R will have on
our financial position and results of operations.

In November 2004, the FASB issued SFAS No. 151,  "Inventory Costs", an amendment
of ARB No. 43, Chapter 4, which would be effective for inventory  costs incurred
during fiscal years  beginning  after June 15, 2005. The amendments made by SFAS
No. 151 will improve financial  reporting by clarifying that abnormal amounts of
idle facility expense,  freight, handling costs, and wasted materials (spoilage)
should be recognized as  current-period  charges and by requiring the allocation
of fixed  production  overheads to inventory based on the normal capacity of the
production  facilities.  We do not anticipate  that the adoption of the SFAS No.
151 will have a significant effect on our earnings or financial position.

In November 2004, the FASB issued SFAS No. 153, "Exchanges of Nonmonetary Assets
- An  Amendment  to APB  Opinion  29".  The  provisions  of this  statement  are
effective for non monetary asset exchanges occurring in fiscal periods beginning
after June 1, 2005.  This  statement  eliminates the exception to fair value for
exchanges of similar  productive assets and replaces it with a general exception
for  exchange  transactions  that do not have  commercial  substance  - that is,
transactions that are not expected to result in significant  changes in the cash
flows of the reporting entity. The Company does not believe that the adoption of
SFAS No.  153 will  have a  significant  effect  on our  earnings  or  financial
position.


                                      -24-
<PAGE>

Item 7. Financial Statements

                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
Kiwa Bio-Tech Products Group Corporation

We have audited the  accompanying  consolidated  balance sheets of Kiwa Bio-Tech
Products Group  Corporation  and Subsidiary  (the  "Company") as of December 31,
2004  and  2003,  and  the  related   consolidated   statements  of  operations,
stockholders'  equity  (deficiency)  and cash flows for the years ended December
31,  2004  and  2003.   These   consolidated   financial   statements   are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing standards
as established by the Auditing Standards Board (United States) and in accordance
with the auditing  standards of the Public Company  Accounting  Oversight  Board
(United States).  Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the consolidated  financial statements
are free of material misstatement. The Company is not required to have, nor were
we  engaged  to  perform,  an  audit of its  internal  controls  over  financial
reporting.  Our audit included consideration of internal controls over financial
reporting as a basis for designing audit  procedures that are appropriate in the
circumstances,  but  not  for  the  purpose  of  expressing  an  opinion  on the
effectiveness  of the  Company's  internal  control  over  financial  reporting.
Accordingly we express no such opinion. An audit includes  examining,  on a test
basis,  evidence  supporting  the amounts and  disclosures  in the  consolidated
financial statements. An audit also includes assessing the accounting principles
used and  significant  estimates made by  management,  as well as evaluating the
overall  consolidated  financial  statement  presentation.  We believe  that our
audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all  material  respects,  the  financial  position of Kiwa  Bio-Tech
Products Group  Corporation  and Subsidiary as of December 31, 2004 and 2003 and
the consolidated  results of their operations and their cash flows for the years
ended  December 31, 2004 and 2003,  in  conformity  with  accounting  principles
generally accepted in the United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
consolidated  financial  statements,  the Company has suffered  recurring losses
from operations, has a working capital deficit and a net capital deficiency that
raise  substantial  doubt  about its  ability to  continue  as a going  concern.
Management's  plans in regard to these matters are also described in Note 1. The
consolidated  financial  statements  do not include any  adjustments  that might
result from the outcome of this uncertainty.

/s/ Grobstein, Horwath & Company, LLP

Sherman Oaks, California
February 25, 2005


                                      -25-
<PAGE>

Consolidated Balance Sheets

            Kiwa Bio-Tech Products Group Corporation and Subsidiaries

                           Consolidated Balance Sheets

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
                                                                              Year Ended December 31,
                                                     --------------------------------------------------------------------------
                                                                     2004                                 2003
-------------------------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>                                 <C>
ASSETS
Current assets
    Cash and cash equivalents                                                  $    17,049                         $    48,730
    Restricted cash                                                                     --                             300,000
    Accounts receivable                                                            963,403                              45,235
    Other receivable                                                               157,495                                  --
    Inventories                                                                     83,677                             135,201
    Due from related party                                                              --                              30,574
    Prepaid consulting fees                                                        131,600                                  --
    Other current assets                                                            26,340                             109,811
-------------------------------------------------------------------------------------------------------------------------------
Total current assets                                                             1,379,564                             669,551
Property, Plant and Equipment:
    Buildings                                                                      986,965                           1,045,599
    Machinery and equipment                                                        218,250                             312,784
    Automobiles                                                                    101,321                              97,485
    Office equipment                                                                49,688                              11,640
    Computer software                                                                8,717                                  --
-------------------------------------------------------------------------------------------------------------------------------
                                                                                 1,364,941                           1,467,508
Less: accumulated depreciation                                                    (109,847)                            (35,468)
-------------------------------------------------------------------------------------------------------------------------------
Property plant and equipment - net                                               1,255,094                           1,432,040
Construction in progress                                                            32,595                              45,108
Intangible asset-net                                                               463,730                                  --
-------------------------------------------------------------------------------------------------------------------------------
Total assets                                                                 $   3,130,983                       $   2,146,699
===============================================================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
Current liabilities
    Accounts payable and accrued expenses                                          577,653                             214,138
    Construction costs payable                                                     370,453                             523,498
    Short-term loans                                                                50,000                             283,930
    Due to related party                                                           112,105                                  --
    Convertible notes payable-unrelated party                                      312,104                                  --
    Convertible notes payable-related party                                             --                             100,000
    Current portion of unsecured loans payables                                         --                             120,821
    Current portion of bank notes payables                                          12,879                              12,477
-------------------------------------------------------------------------------------------------------------------------------
Total current liabilities                                                        1,435,194                           1,254,864
Long-term liabilities, less current portion:
    Unsecured loans payable                                                      1,389,443                           1,063,226
    Bank notes payable                                                              26,853                              39,732
-------------------------------------------------------------------------------------------------------------------------------
Total long-term liabilities                                                      1,416,296                           1,102,958
Shareholders' equity (deficiency)
    Common stock -$0.001 par value
      Authorized  100,000,000  shares and 50,000,000
      shares at December 31, 2004 and 2003,  respectively
      Issued  and  outstanding  40,873,711  shares  and
      30,891,676 shares at December 31, 2004 and
      2003, respectively                                                            40,874                              30,892
    Preferred stock -$0.001 par value
      Authorized  20,000,000  shares  and nil  shares
      at     December 31, 2004 and 2003, respectively
      Issued   and    outstanding   nil   shares   at
      December 31, 2004 and 2003                                                        --                                  --
    Additional paid-in capital                                                   4,393,415                           1,184,108
    Accumulated deficit                                                         (4,154,796)                         (1,426,123)
-------------------------------------------------------------------------------------------------------------------------------
Total shareholders' equity (deficiency)                                            279,493                            (211,123)
-------------------------------------------------------------------------------------------------------------------------------
Total liabilities and stockholders' equity                                   $   3,130,983                   $       2,146,699
===============================================================================================================================
</TABLE>


                                      -26-
<PAGE>

Consolidated Statements of Operations

            Kiwa Bio-Tech Products Group Corporation and Subsidiaries

                      Consolidated Statements of Operations

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------
                                                                Year Ended December 31,
                                                             2004                     2003
------------------------------------------------------------------------------------------------------
<S>                                                         <C>                        <C>
Net sales                                                   $      1,300,251           $       40,031
    Cost of sales                                                    641,236                   30,294
------------------------------------------------------------------------------------------------------
Gross profit                                                         659,015                    9,737
Operating expenses:
    Consulting and professional fees                                 448,442                  545,787
    Directors' compensation                                           77,398                  347,110
    General and administrative                                       598,492                  327,501
    Research and development                                          49,622                   63,434
    Depreciation and amortization                                     52,798                   18,585
    Reverse merger costs                                           1,417,434                   50,336
                                                  ----------------------------------------------------
Total costs and expenses                                           2,644,186                1,352,753
------------------------------------------------------------------------------------------------------
Operating loss                                                    (1,985,171)              (1,343,016)
------------------------------------------------------------------------------------------------------
Interest income (expense),net                                       (803,913)                 (12,223)
Other income                                                          60,411                       --
------------------------------------------------------------------------------------------------------
Net loss                                                    $     (2,728,673)          $   (1,355,239)
------------------------------------------------------------------------------------------------------
Net loss per common share
    -basic and diluted                                      $         (0.074)          $       (0.044)

Weighted average number of common shares
outstanding-basic and diluted                                     36,887,339               30,891,676
------------------------------------------------------------------------------------------------------
</TABLE>


                                      -27-
<PAGE>

Consolidated Statement of Stockholders' Equity (Deficiency)

            Kiwa Bio-Tech Products Group Corporation and Subsidiaries

           Consolidated Statement of Stockholders' Equity (Deficiency)

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
                                                         Common Stock
                                                                                                                        Total
                                                                                  Additional      Accumulated   Stockholders' Equity
                                                        Shares       Amount    Paid-in Capital      Deficits        (Deficiency)
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                   <C>           <C>            <C>           <C>                     <C>
 Balance, January 1, 2003                             12,356,670    $ 12,357       $   452,643   $    (70,884)           $  394,116
------------------------------------------------------------------------------------------------------------------------------------
Share issued to consultants  for services at $0.04
per share on December 31, 2003                        10,503,170      10,503           414,497             --               425,000
------------------------------------------------------------------------------------------------------------------------------------
Shares issued to directors as directors'
compensation at $0.04 per share on December 31,
2003                                                   8,031,836       8,032           316,968             --               325,000
------------------------------------------------------------------------------------------------------------------------------------
 Net loss for the year ended December 31, 2003                --          --                --     (1,355,239)           (1,355,239)
------------------------------------------------------------------------------------------------------------------------------------
 Balance, December 31, 2003                           30,891,676      30,892         1,184,108     (1,426,123)             (211,123)
------------------------------------------------------------------------------------------------------------------------------------
Shares retained by public shareholders in
March 2004 reverse merger transaction                  4,038,572       4,038            (4,038)            --                    --
------------------------------------------------------------------------------------------------------------------------------------
Issuance of warrants  valued at $0.54 per share on
March  30,  2004 in  conjunction  with  March 2004
reverse merger transaction                                    --          --           943,380             --               943,380
------------------------------------------------------------------------------------------------------------------------------------
Issuance  of stock  options  valued  at $0.57  per
share  on  March  30,   2004  to   consultant   in
conjunction   with   March 2004   reverse   merger
transaction                                                   --          --           171,000             --               171,000
------------------------------------------------------------------------------------------------------------------------------------
Beneficial  conversion feature of convertible note
payable funded on January 25, 2004                            --          --           500,000             --               500,000
------------------------------------------------------------------------------------------------------------------------------------
Beneficial  conversion feature of convertible note
payable funded on April 7, 2004                               --          --           200,000             --               200,000
------------------------------------------------------------------------------------------------------------------------------------
Restricted  shares  issued  to  a  consultant  for
services at $0.45 per share on May 24, 2004.              75,000          75            33,675             --                33,750
------------------------------------------------------------------------------------------------------------------------------------
Shares  issued  upon   conversion  of  convertible
notes payable at $0.25 per share on June 8, 2004       2,800,000       2,800           697,200             --               700,000
------------------------------------------------------------------------------------------------------------------------------------
Shares issued to China Agricultural  University in
conjunction   with  April  2004  Patent   Transfer
Agreement at $0.42 per share on July 19, 2004          1,000,000       1,000           419,000             --               420,000
------------------------------------------------------------------------------------------------------------------------------------
Shares issued to consultant  in  conjunction  with
July 2004 Standby Equity Distribution  transaction
at $0.001 per share on July 29, 2004                      26,567          27               (27)            --                    --
------------------------------------------------------------------------------------------------------------------------------------
Shares issued for  commitment  fee in  conjunction
with  July  2004   Standby   Equity   Distribution
transaction at $0.001 per share on July 29, 2004         704,039         704              (704)            --                    --
------------------------------------------------------------------------------------------------------------------------------------
Shares  issued to lawyer  for  legal  services  on
September,  19 at $0.014  per  share on  September
14, 2004                                                 892,857         893           124,107             --               125,000
------------------------------------------------------------------------------------------------------------------------------------
Issuance  of  warrants  on  September  23, 2004 in
conjunction with September 2004 convertible  notes
payable                                                       --          --            82,559             --                82,559
------------------------------------------------------------------------------------------------------------------------------------
Shares  issued  to  consultants  for  services  at
$0.10 per share on October 1, 2004                       415,000         415            41,085             --                41,500
------------------------------------------------------------------------------------------------------------------------------------
Issuance   of   restricted   common   stock  to  a
consultant  as final  compensation  at  $0.07  per
share on November 19, 2004                                30,000          30             2,070             --                 2,100
------------------------------------------------------------------------------------------------------------------------------------
 Net loss for the year ended December 31, 2004                --          --                --     (2,728,673)           (2,728,673)
------------------------------------------------------------------------------------------------------------------------------------
 Balance, December 31, 2004                           40,873,711    $ 40,874       $ 4,393,415   $ (4,154,796)           $  279,493
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                      -28-
<PAGE>

Consolidated Statements of Cash Flows

            Kiwa Bio-Tech Products Group Corporation and Subsidiaries

                      Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
                                                                                   Year Ended
                                                                                  December 31,
                                                              ------------------------------------------------------
                                                                         2004                      2003
--------------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>                      <C>
Cash flows from operating activities:
Net loss                                                               $       (2,728,673)      $       (1,355,239)
Adjustments to reconcile net loss
to net cash used in operating activities:
    Issuance of common stock for services                                         202,350                  425,000
    Issuance of common stock for director's compensation                               --                  325,000
    Issuance of securities for reverse merger costs                             1,114,380                       --
    Depreciation and amortization                                                  91,061                   35,163
    Amortization of detachable warrants                                            44,663                       --
    Amortization of beneficial conversion feature
    of convertible notes payable                                                  700,000                       --
    (Gain)/Loss on disposal of fixed assets                                       121,268                       --
    Changes in operating assets and liabilities:
    (Increase)decrease in :
        Accounts receivable                                                      (918,168)                 (45,235)
        Inventories                                                                51,524                 (128,906)
        Other receivable                                                         (157,495)                      --
        Prepaid consulting fees                                                  (131,600)                      --
        Other current assets                                                       83,471                  (77,584)
        Due from related party                                                     30,574                  (30,574)
    Increase(decrease)in:
        Accounts payable and accrued expenses                                     363,515                  169,276
        Due to related party                                                       12,105                  (26,902)
--------------------------------------------------------------------------------------------------------------------
Net cash used in operating activities                                          (1,121,025)                (710,001)
--------------------------------------------------------------------------------------------------------------------
Cash flows from investing activities:
    Purchase of property and equipment                                           (159,234)                (925,170)
    Acquisition of intangible asset                                               (60,411)                      --
-------------------------------------------------------------------------------------------------------------------
Net cash used in investing activities                                            (219,645)                (925,170)
--------------------------------------------------------------------------------------------------------------------
Cash flows from financing activities:
    Decrease (increase) in restricted cash                                        300,000                 (300,000)
    Proceeds from short-term loans                                                 50,000                  283,930
    Repayment of short-term loans                                                (283,930)                      --
    Proceeds from convertible notes payable                                     1,050,000                  100,000
    Proceeds from long-term borrowings                                            265,806                       --
    Repayment of long-term borrowings                                             (72,887)               1,077,914
--------------------------------------------------------------------------------------------------------------------
Net cash provided by financing activities                                       1,308,989                1,161,844
--------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents:
   Net increase(decrease)                                                         (31,681)                (473,327)
   Balance at beginning of year                                                    48,730                  522,057
--------------------------------------------------------------------------------------------------------------------
Balance at end of year                                                 $           17,049       $           48,730
====================================================================================================================

Supplemental Disclosures of Cash flow Information:
Cash paid for interest                                                 $           57,966       $           12,223
Cash paid for taxes                                                                    --                       --
Non-cash investing and financing activities:
    Issuance of common stock for convertible notes payable                        700,000                       --
    Beneficial conversion feature of convertible notes payable                    700,000                       --
    Transfer from convertible notes due to related party                          100,000                       --
    Issuance of common stock in exchange for patent                               420,000                       --
    Issuance of detachable warrants in conjunction
        with issuance of convertible notes payable                                 82,559                       --
--------------------------------------------------------------------------------------------------------------------
</TABLE>


                                      -29-
<PAGE>

Notes to Consolidated Financial Statements

1. Background and Basis of Presentation

Organization  - On March 12, 2004,  pursuant to an Agreement  and Plan of Merger
dated as of March 11, 2004, by and among Tintic Gold Mining Company  ("Tintic"),
TTGM Acquisition Corporation,  a Utah corporation and wholly-owned subsidiary of
Tintic  Gold  Mining  Company,  and Kiwa  Bio-Tech  Products  Group Ltd.  ("Kiwa
Bio-Tech"),  a British  Virgin  Islands  international  business  company,  TTGM
Acquisition  Corporation merged with and into Kiwa Bio-Tech.  Each share of Kiwa
Bio-Tech common stock was converted into 1.5445839  shares of Tintic Gold Mining
Company  Common  Stock,  with Kiwa  Bio-Tech  surviving  as Tintic  Gold  Mining
Company's wholly-owned subsidiary. The merger resulted in a change of control of
Tintic  Gold Mining  Company,  with former  Kiwa  Bio-Tech  stockholders  owning
approximately  89% of Tintic  Gold  Mining  Company  on a fully  diluted  basis.
Subsequent to the merger,  Tintic Gold Mining  Company  changed its name to Kiwa
Bio-Tech  Products  Group  Corporation  (the  "Company").  On July 22, 2004,  we
completed our  reincorporation  in the State of Delaware.  The Company accounted
for this transaction as a reverse merger.

In 2002,  Kiwa Bio-Tech  chartered  Kiwa Bio-Tech  Products  (Shandong) Co. Ltd.
("Kiwa-SD"), a wholly-owned subsidiary organized under the laws of China, as its
offshore   manufacturing   base  to  capitalize   on  low  cost,   high  quality
manufacturing  advantages available in China. In October 2003, Kiwa-SD completed
Phase I construction of its state-of-the-art manufacturing facility. In November
2003, Kiwa-SD began shipping its first commercial product, a bio-fertilizer,  to
the agricultural  market in China. We are currently  working on existing product
improvement  and new  product  development  while we  continue  our  three-phase
facility build-up.

Business - The Company  intends to develop,  manufacture,  distribute and market
innovative,  cost-effective and environmentally safe bio-technological  products
for the agricultural,  natural resources and environmental  protection  markets,
primarily  in China.  The Company  intends to improve  existing  products and to
develop new products.  Activities to date have included  conducting research and
development,  acquiring and developing  intellectual property,  raising capital,
development   of  a   manufacturing   facility,   identification   of  strategic
acquisitions  and execution of sales in selected major  agricultural  markets in
China. The Company's first product, a photosynthesis  biological  catalyst,  was
introduced in the Chinese  agricultural market in November 2003. The Company has
completed  the  development  stage  in  fourth  quarter  of 2004 as the  Company
generated substantial revenue from planned principal operations.


                                      -30-
<PAGE>

Basis of  Presentation  - The  consolidated  financial  statements  include  the
operations of Kiwa Bio-Tech  Products  Group  Corporation  and its  wholly-owned
subsidiaries, and are presented in accordance with generally accepted accounting
principles  in the United  States.  All  significant  intercompany  balances and
transactions have been eliminated in consolidation.

Use of Estimates - The  preparation of financial  statements in conformity  with
accounting  principles  generally  accepted  in the  United  States  of  America
requires  management to make estimates and assumptions  that affect the reported
amounts  of  assets  and  liabilities,   disclosure  of  contingent  assets  and
liabilities  at the  date  of the  consolidated  financial  statements,  and the
reported  amounts of revenues and expenses during the reporting  period.  Actual
results could differ from those estimates.

Country Risk - As the Company's principal operations are conducted in China, the
Company is subject to special considerations and significant risks not typically
associated  with  companies  in North  America and Western  Europe.  These risks
include,  among others, risks associated with the political,  economic and legal
environments and foreign currency exchange limitations encountered in China. The
Company's  results of  operations  may be  adversely  affected by changes in the
political  and  social  conditions  in China,  and by  changes  in  governmental
policies with respect to laws and regulations, among other things.

In  addition,  all  of  the  Company's  transactions  undertaken  in  China  are
denominated  in RMB,  which  must be  converted  into  other  currencies  before
remittance  out of China  may be  considered.  Both the  conversion  of RMB into
foreign  currencies and the remittance of foreign  currencies abroad require the
approval of the Chinese government.

Credit Risk - The Company performs  ongoing credit  evaluations of its customers
and intends to establish an allowance for doubtful accounts when amounts are not
considered  fully  collectable.  According to the Company's  credit policy,  the
Company  provides 100% bad debt provision for the amounts  outstanding  over 365
days,  which  management  believes is consistent  with industry  practice in the
China  region.  Based  on  industry  practice  and  the  credit  history  of the
customers,  the  management  of the Company  believes  the  accounts  receivable
balance as of December 31, 2004 will be fully collected.

Going  Concern  - The  consolidated  financial  statements  have  been  prepared
assuming that the Company will continue as a going concern,  which  contemplates
the  realization  of assets and the  satisfaction  of  liabilities in the normal
course of business.  The carrying amounts of assets and liabilities presented in
the consolidated financial statements do not purport to represent the realizable
or settlement values. We incurred a net loss of $2,728,673 and $1,355,239 during
the fiscal year ended December 31, 2004 and 2003, respectively,  and our current
liabilities  exceeded our current assets by $55,630 and $585,313 at December 31,
2004 and 2003,  respectively.  These factors create  substantial doubt about our
ability to continue as a going concern.

Company  management  continues  to  evaluate  the  Company's  cash needs and the
availability of debt and equity financing to fund the Company's operations.

As  a  result  of  the  aforementioned   conditions,  the  Company's  registered
independent public  accountants,  in their independent  auditors' reports on the
consolidated financial statements as of and for the year ended December 31, 2004
and 2003,  have included an  explanatory  paragraph in their opinion  indicating
that there is  substantial  doubt about the  Company's  ability to continue as a
going  concern.  The financial  statements do not contain any  adjustments  that
might result from the outcome of this uncertainty.

Revenue Recognition - The Company recognizes sales in accordance with Securities
and Exchange  Commission  ("SEC")  Staff  Accounting  Bulletin  ("SAB") No. 101,
"Revenue  Recognition  in  Financial  Statements",  as amended  by SAB No.  104,
"Revenue Recognition". Sales represent the invoiced value of goods, net of value
added tax ("VAT"),  supplied to customers,  and are recognized  upon delivery of
goods and passage of title.

All of the Company's sales made in China are subject to the Chinese  value-added
tax at rates ranging from 13% to 17% ("output VAT").  Such output VAT is payable
after offsetting VAT paid by the Company on purchases ("input VAT").

Net  Loss Per  Common  Share - Basic  loss per  common  share is  calculated  by
dividing net loss by the weighted  average  number of common shares  outstanding
during the period. Diluted loss per common share reflects the potential dilution
that would occur if dilutive securities (stock options, warrants and convertible
debt) were exercised. These potentially dilutive securities were not included in
the calculation of loss per share for the periods  presented because the Company
incurred  a loss  during  such  periods  and thus their  effect  would have been
anti-dilutive.  Accordingly, basic and diluted loss per common share is the same
for all  periods  presented.  As of  December  31,  2004,  potentially  dilutive
securities  aggregated  4,847,000  shares of common  stock.  The loss per common
share  calculation for the year ended December 31, 2003 reflects the retroactive
restatement  of the  stockholders'  equity  (deficiency)  section of the balance
sheet to reflect the March 2004 recapitalization of Kiwa Bio-Tech.


                                      -31-
<PAGE>

The Company  effected a 4-for-1 split of its outstanding  shares of common stock
effective  March 29, 2004, in conjunction  with the reverse  merger  transaction
with Kiwa Bio-Tech as described above. Unless otherwise indicated, all share and
per share  amounts  presented  herein  have been  adjusted  to reflect the stock
split.

Advertising - The Company charges all advertising  costs to expense as incurred.
Advertising expenses for the years ended December 31, 2004 and 2003 were $17,416
and $4,788, respectively.

Research and development - Research and development costs are charged to expense
as incurred.

Cash and Cash  Equivalents - Highly liquid  investments with a maturity of three
months or less at the time of acquisition are considered to be cash equivalents.

Financial  Instruments  and Fair  Value - The  Company  accounts  for  financial
instruments under the provisions of Statement of Financial  Accounting Standards
("SFAS")  No.  133:   "Accounting   for  Derivative   Instruments   and  Hedging
Activities",  which  requires  that  all  derivative  financial  instruments  be
recognized in the consolidated financial statements and maintained at fair value
regardless of the purpose or intent for holding  them.  Changes in fair value of
derivative financial instruments are either recognized periodically in income or
stockholders'  equity (as a component  of  comprehensive  income),  depending on
whether  the  derivative  is being  used to hedge  changes in fair value or cash
flows.  The  adoption  of SFAS No.  133 did not have a  material  impact  on the
Company's  consolidated  financial position or its results of operations because
the Company does not currently hold any  derivative  financial  instruments  and
does not engage in hedging  activities.  The carrying  amounts for cash and cash
equivalents,  restricted cash, accounts receivable, other receivables,  deposits
and prepayments,  short-term  borrowings,  accounts payable,  other payables and
accruals  approximate  their fair values  because of the short maturity of those
instruments. The Company estimates that the carrying value of its long-term debt
also  approximates  its fair value based on financing  currently  available from
government sponsored programs and other lenders.

Inventories  -  Inventories  are  stated at the lower of cost,  determined  on a
weighted average basis, and net realizable  value. Work in progress and finished
goods  are  composed  of  direct  material,   direct  labor  and  a  portion  of
manufacturing  overhead. Net realizable value is the estimated selling price, in
the ordinary  course of business,  less estimated costs to complete and dispose.
Management believes that there is no obsolete inventory.

Property,  Plant and  Equipment - Property,  Plant and  Equipment  are stated at
cost.  Major  expenditures  for betterments  and renewals are capitalized  while
ordinary  repairs and maintenance  costs are expensed as incurred.  Depreciation
and amortization is provided using the  straight-line  method over the estimated
useful  lives of the assets after  taking into  account the  estimated  residual
value. The estimated useful lives are as follows:

  Buildings                              20-35 years
  Machinery and equipments                4-12 years
  Automobiles                                8 years
  Office equipment                           5 years
  Computer software                          3 years

Construction  in  progress  represents  land costs as well as factory and office
buildings  under  construction.  The  Company  capitalizes  interest  during the
construction  phase of  qualifying  assets  in  accordance  with  SFAS  No.  34,
"Capitalization  of Interest Cost." No interest was capitalized  during 2004 and
2003 as the construction in progress was minimal.

We periodically evaluate our investment in long-lived assets, including property
and equipment,  for  recoverability  whenever events or changes in circumstances
indicate the net carrying amount may not be recoverable. Our judgments regarding
potential  impairment  are  based  on  legal  factors,   market  conditions  and
operational performance indicators, among others. In assessing the impairment of
property and equipment,  we make assumptions regarding the estimated future cash
flows and other factors to determine the fair value of the respective assets. If
these  estimates  or the related  assumptions  change in the  future,  we may be
required  to  record  impairment  charges  for these  assets.  The  Company  has
determined  that there was no impairment  of  long-lived  assets at December 31,
2004.


                                      -32-
<PAGE>

Income Taxes - The Company  accounts for income  taxes under the  provisions  of
SFAS No. 109,  "Accounting  for Income  Taxes",  which  requires  recognition of
deferred tax assets and liabilities for the expected future tax  consequences of
events that have been included in the consolidated  financial  statements or tax
returns.  Deferred  income taxes are provided using the liability  method and is
recognized for all significant  temporary differences between the income tax and
financial  statement  bases of assets and  liabilities.  There were no  material
deferred tax assets or liabilities as of December 31, 2004 and 2003.

Operating   Leases  -  Operating  leases  represent  those  leases  under  which
substantially all the risks and rewards of ownership of the leased assets remain
with the lessors.  Rental payments under operating leases are charged to expense
on the straight-line basis over the period of the relevant leases.

Foreign  Currency  Translation - The  functional  currency of the Company is the
RMB.  Transactions  denominated in foreign currencies are translated into RMB at
the unified  exchange rates quoted by the People's Bank of China,  prevailing at
the transaction  dates.  Monetary assets and liabilities  denominated in foreign
currencies are translated into RMB using the applicable  unified  exchange rates
prevailing at the balance sheet date.

Translations  of amounts  from RMB into United  States  Dollars  ("US$") were at
approximately US $1.00 = RMB 8.28 for all periods  presented.  No representation
is made that the RMB amounts could have been, or could be, converted into US$ at
that rate or at any other  rate.  Due to the  stability  of the RMB  during  the
periods covered by the consolidated  financial statements,  no material exchange
differences exist.

Comprehensive Income (Loss) - The Company has adopted the provisions of SFAS No.
130, "Reporting  Comprehensive  Income".  SFAS No. 130 establishes standards for
the  reporting  and  display  of  comprehensive   income,   its  components  and
accumulated balances in a full set of general purpose financial statements. SFAS
No. 130  defines  comprehensive  income  (loss) to include all changes in equity
except those resulting from  investments by owners and  distributions to owners,
including  adjustments  to  minimum  pension  liabilities,  accumulated  foreign
currency translation,  and unrealized gains or losses on marketable  securities.
The Company  did not have any  minimum  pension  liabilities,  foreign  currency
translation  income  or  loss  or  unrealized  gains  or  losses  on  marketable
securities at December 31, 2004.

The Company's only component of comprehensive  income (loss) is foreign currency
translation income (loss).  Comprehensive income (loss) was not material for all
periods presented.

Stock-Based  Compensation  - The Company  periodically  issues  shares of common
stock for services rendered or for financing costs. Such shares are valued based
on the market price on the transaction date.

The Company  periodically  issues stock  options and  warrants to employees  and
non-employees in non-capital raising transactions for services and for financing
costs.

The Company has adopted SFAS No. 123, "Accounting for Stock-Based Compensation",
which establishes a fair value method of accounting for stock-based compensation
plans.

The  provisions  of SFAS No. 123 allow  companies to either record an expense in
the financial statements to reflect the estimated fair value of stock options or
warrants to employees,  or to continue to follow the intrinsic  value method set
forth in  Accounting  Principles  Board  Opinion No. 25,  "Accounting  for Stock
Issued to Employees", but to disclose on an annual basis the pro forma effect on
net income  (loss) and net income  (loss) per common share had the fair value of
the stock options and warrants been recorded in the financial  statements.  SFAS
No. 123 was amended by SFAS No. 148, which now requires companies to disclose in
financial  statements  the pro forma effect on net income  (loss) and net income
(loss) per common share of the  estimated  fair market value of stock options or
warrants issued to employees. The Company has elected to continue to account for
stock-based   compensation   plans   utilizing  the   intrinsic   value  method.
Accordingly, compensation cost for stock options and warrants is measured as the
excess,  if any, of the fair market price of the  Company's  common stock at the
date of grant above the amount an employee must pay to acquire the common stock.

In accordance  with SFAS No. 123, the cost of stock options and warrants  issued
to  non-employees  is  measured at the grant date based on the fair value of the
award.  The  fair  value  of the  stock-based  award  is  determined  using  the
Black-Scholes  option-pricing  model. The resulting amount is charged to expense
on the  straight-line  basis  over the  period in which the  Company  expects to
receive benefit, which is generally the vesting period.


                                      -33-
<PAGE>

The Company did not issue any stock options to its officers or management during
the fiscal years ended December 31, 2004 and 2003.

Reclassification  from prior year audited  financial  statements - Certain prior
year comparative figures have been reclassified to conform with the current year
presentation.

2. Recent Accounting Pronouncements

In September 2004,  Emerging  Issues Task Force ("EITF")  reached a consensus on
EITF Issue No. 04-08 ("EITF  04-08"),  "The Effect of  Contingently  Convertible
Debt on Diluted Earnings per Share".  Under current  interpretations of FASB No.
128, "Earnings per Share", issuers of contingently  convertible debt instruments
("Co-Cos")  generally  exclude the potential common shares underlying the Co-Cos
from the calculation of diluted  earnings per share until the underlying  common
stock achieves a specified price target, or other contingency is met. EITF 04-08
requires  that  Co-Cos  should  be  included  in  diluted   earnings  per  share
computations,  if dilutive,  regardless  of whether the market price trigger has
been met.  We do not  anticipate  that the  adoption  of EITF  04-08 will have a
significant effect on our earnings or financial position.

On October 13, 2004, the FASB issued the SFAS No. 123R,  "Share-Based  Payment",
which  would  require  all  companies  to  measure  compensation  cost  for  all
share-based  payments (including employee stock options) at fair value, would be
effective for public  companies for interim or annual  periods  beginning  after
June  15,  2005.  We  could  adopt  the new  standard  in one of two ways -- the
modified prospective transition method or the modified retrospective  transition
method. We will adopt SFAS No. 123R in our fourth quarter of fiscal 2005 and are
currently  evaluating the effect that the adoption of SFAS No. 123R will have on
our financial position and results of operations.

In November 2004, the FASB issued SFAS No. 151,  "Inventory Costs", an amendment
of ARB No. 43, Chapter 4, which would be effective for inventory  costs incurred
during fiscal years  beginning  after June 15, 2005. The amendments made by SFAS
No. 151 will improve financial  reporting by clarifying that abnormal amounts of
idle facility expense,  freight, handling costs, and wasted materials (spoilage)
should be recognized as  current-period  charges and by requiring the allocation
of fixed  production  overheads to inventory based on the normal capacity of the
production  facilities.  We do not anticipate  that the adoption of the SFAS No.
151 will have a significant effect on our earnings or financial position.

In November 2004, the FASB issued SFAS No. 153, "Exchanges of Nonmonetary Assets
- An  Amendment  to APB  Opinion  29".  The  provisions  of this  statement  are
effective for non monetary asset exchanges occurring in fiscal periods beginning
after June 1, 2005.  This  statement  eliminates the exception to fair value for
exchanges of similar  productive assets and replaces it with a general exception
for  exchange  transactions  that do not have  commercial  substance  - that is,
transactions that are not expected to result in significant  changes in the cash
flows of the reporting entity. The Company does not believe that the adoption of
SFAS No.  153 will  have a  significant  effect  on our  earnings  or  financial
position.

3. Inventories

Inventories consisted of the following at December 31, 2004 and 2003:

<TABLE>
<CAPTION>
------------------------------------ ---------------------------------- ---------------------------------
                                             December 31, 2004                 December 31, 2003
------------------------------------ ---------------------------------- ---------------------------------
<S>                                                           <C>                               <C>
Raw materials                                                 $ 36,248                          $ 23,497
Work in progress                                                32,295                           111,390
Finished goods                                                  15,134                               314
------------------------------------ ---------------------------------- ---------------------------------
Total                                                         $ 83,677                          $135,201
</TABLE>

4. Other receivable

The other  receivable  consists of an obligation to repay an advance of $157,495
made to an unrelated U.S.  incorporated  entity,  Kiwa Bio-Tech  Products,  Inc.
("KBPI"),  for payment of merger costs in March 2004.  The Company has reached a
repayment  schedule with KBPI, under which KBPI was to initially fully repay the
amount by March 2005. The repayment schedule was subsequently  extended and KBPI
is to fully repay the amount by September 2005.


                                      -34-
<PAGE>

5. Prepaid consulting fees

As of December 31, 2004, the prepaid consulting fees mainly consisted of $63,750
prepaid to KBPI for one-year of marketing  service.  According to the  marketing
service agreement, KBPI will be entitled to receive a royalty of 8% of the gross
profits  derived  from the  products or services  sold by the Company  which are
referred by KBPI.

Other  consulting  fees  included  $45,000  prepaid to a  consultant  for public
relation services and sourcing of equity and debt financing for the Company over
one-year consulting period. The Company prepaid $6,850 to another consultant for
public  relation  services  over six months.  In  addition,  $16,000 in 2004 was
prepaid to a  placement  agent of the  Company  to raise  bridge  financing.  No
consulting fees were paid in 2003.

6. Property Plant and Equipment

The total gross amount of  property,  plant and  equipment  was  $1,364,941  and
$1,467,508,  respectively,  as of December  31, 2004 and 2003.  The  decrease is
mainly due to an adjustment  to reflect the actual costs of property,  plant and
equipment  rather  than  the  previously  estimated  cost  provided  by  project
constructors.  The adjustment of costs is based on the final project invoice and
certified by an independent accountant,  the project constructor and the Company
in the fourth quarter of 2004. It resulted in a decrease of $130,523.

Depreciation  expense was approximately  $74,379 and $35,163 for the years ended
December 31, 2004 and 2003, respectively.

7. Intangible asset

The  Company's  intangible  asset  as of  December  31,  2004  consisted  of the
following:

<TABLE>
<CAPTION>
---------- ---------------------- ---------------- --------------- -----------------
                 Expected         Gross            Accumulated     Intangible
           Amortization Period    Carrying Value   Amortization    asset, Net
---------- ---------------------- ---------------- --------------- -----------------
<S>              <C>                 <C>              <C>              <C>
 Patent          8.5 years           $480,411         $16,681          $463,730
</TABLE>

The following table presents future expected amortization expense related to the
patent:

                                                  Amount
                                                  ------
           2005                                   $  57,074
           2006                                      57,074
           2007                                      57,074
           2008                                      57,074
           2009                                      57,074
           Thereafter                               178,360
                                                  ---------
                                                  $ 463,730
                                                  =========

8. Related Party Transactions with China Star Investment Group

China Star Investment  Group ("China Star") is a company which is 10% owned by a
major stockholder of the Company. The balance due to China Star at December, 31,
2004 of $112,105 was  primarily  related to a loan from China Star and operating
expenses that China Star paid on behalf of the Company.

In October 2003, the Company  obtained a $100,000 loan from China Star. The loan
was  scheduled  to mature on October  20,  2004,  and bears  interest at 12% per
annum, payable at maturity.  As part of the loan terms, China Star had the right
to convert the loan into shares of the Company's common stock at $0.25 per share
at any time prior to the  maturity  date,  subject to the Company  completing  a
reverse merger transaction in the United States, which was accomplished in March
2004.  China Star has waived this conversion  right. The final maturity date has
been subsequently extended to August 31, 2005.

The  balance  due from  China Star at  December  31,  2003 of $30,574  relate to
unsecured, non-interest bearing cash advances that are due on demand.


                                      -35-
<PAGE>

9. Construction Costs Payable

As of December 31, 2004, construction costs payable represents remaining amounts
to be paid  for the  Phase  I  construction  project  based  on the  independent
accountant's  certification discussed in Note 6. Construction costs payable will
be fully repaid in 2005.  As of December 31, 2003,  construction  costs  payable
represents  the estimated  cost  provided by the  construction  contractor.  The
amount was adjusted upon completion of the project.

10. Short-term Loans

As of December  31,  2004,  short term loans  consisted of loans of $50,000 from
Greater China Securities Inc. The loans were unsecured, non-interest bearing and
were repaid in February 2005.

As of December 31, 2003, short-term loans consisted of RMB bank loans secured by
a US dollar  deposit of $300,000,  maturing on various  dates through June 2004,
with interest rates ranging from 5.04% to 6.90% per annum.

11. Convertible notes payable

On January 25, 2004, the Company  entered into a convertible  loan agreement for
$500,000,  with interest at 12%, payable at maturity.  The loan was scheduled to
mature on  September  25,  2004.  As part of the loan terms,  the lender has the
right to convert the loan into shares of the Company's common stock at $0.25 per
share at any time prior to the maturity date,  subject to the Company completing
a reverse merger  transaction in the United States,  which was  accomplished  in
March  2004.  On June 8,  2004,  the lender  converted  the  $500,000  loan into
2,000,000  shares of the  Company's  common stock at the agreed upon  conversion
price of $0.25 per share.  The lender is an unrelated  party located outside the
United States.

The fair value of the beneficial conversion feature of this convertible loan was
determined  to  be  $500,000,  based  on a  formula  that  takes  the  lower  of
outstanding loan principal and the difference between the $0.25 conversion price
and the fair market value of the Company's  common stock of $0.60 per share. The
fair value of $500,000 was recorded as a reduction to convertible  notes payable
and charged to operations as interest  expense from January 25, 2004 through the
conversion  date (June 8, 2004),  which  resulted in a charge to  operations  of
$281,250 before the conversion date. The unamortized  deferred  interest expense
of $218,750 as of the conversion date was charged to operations.

On March 12, 2004,  the Company  entered into a convertible  loan  agreement for
$200,000,  with interest at 12%, payable at maturity.  The loan was scheduled to
mature three months after funding. As part of the loan terms, the lender has the
right to convert the loan into shares of the Company's common stock at $0.25 per
share at any time prior to the maturity date,  subject to the Company completing
a reverse merger  transaction in the United States,  which was  accomplished  in
March 2004.  The loan was not funded until April 7, 2004.  On June 8, 2004,  the
lender  converted the $200,000 loan into 800,000 shares of the Company's  common
stock at the agreed upon conversion  price of $0.25 per share.  The lender is an
unrelated party located outside the United States.

The fair value of the beneficial conversion feature of this convertible loan was
determined  to  be  $200,000,  based  on a  formula  that  takes  the  lower  of
outstanding loan principal and the difference between the $0.25 conversion price
and the fair market value of the Company's  common stock of $0.60 per share. The
fair value of $200,000 was recorded as a reduction to convertible  notes payable
and charged to  operations  as interest  expense  from April 7, 2004 through the
conversion  date (June 8, 2004),  which  resulted in a charge to  operations  of
$133,333 before the conversion date. The unamortized  deferred  interest expense
of $66,667 as of the conversion date was charged to operations.

On September 23, 2004, the Company entered into a convertible loan agreement for
$350,000  with  interest  at 10% per  annum,  and  issued  1,050,000  detachable
warrants.  The loan was initially due on March 23, 2005,  but the final maturity
date was subsequently  extended by agreement to April 21, 2005. The lender is an
unrelated party located in the United States.  Each warrant  entitles the holder
to subscribe  for one share of common stock of the Company at an exercise  price
of $0.20 per share through  September 23, 2007. None of the detachable  warrants
were exercised in the fiscal year ended  December 31, 2004. The intrinsic  value
of the detachable warrants was determined to be $82,559,  calculated pursuant to
the  Black-Scholes  option pricing model in accordance with EITF Issue No 00-27.
This intrinsic  value has been recorded as a reduction to the  convertible  loan
and has been credited to additional  paid-in capital,  and is being amortized on
the  straight-line  basis over the term of the loan with the  amounts  amortized
being recognized as interest expense.  Any unamortized discount remaining at the
date of conversion  of the loan will be  recognized  as interest  expense in the
period the conversion  takes place.  In addition,  the Company's Chief Executive
Officer, Mr. Li Wei, also executed a guarantee of repayment of the loan which is
secured by shares of the Company's common stock that he owns.


                                      -36-
<PAGE>

In connection  with the  September  23, 2004  convertible  loan  agreement,  the
Company  recorded  deferred  debt issuance  costs of $32,000,  consisting of the
direct costs incurred for the issuance of the  convertible  loan.  Debt issuance
costs are  being  amortized  on the  straight-line  method  over the term of the
convertible  loan,  with the  amounts  amortized  being  recognized  as interest
expense. Any unamortized debt issuance costs remaining at the date of conversion
of the loan will be recognized as interest  expense in the period the conversion
takes place.

12. Unsecured loans payable

Unsecured loans payable  (including  current portion) consisted of the following
at December 31:

<TABLE>
<CAPTION>
---------------------------------------------------------------- ------------- ----------------------------- -----------------------
                                                                    Notes               2004                          2003
---------------------------------------------------------------- ------------- ----------------------------- -----------------------
<S>                                                                 <C>                       <C>                        <C>
Unsecured loan payable to Zoucheng Municipal                        (i)
Government,  non-interest bearing, becoming due within
three years from Kiwa-SD's first  profitable year on a
formula  basis,  interest  has not been imputed due to
the undeterminable repayment date                                                             $1,087,390                 $1,063,226
---------------------------------------------------------------- ------------- ----------------------------- -----------------------
Unsecured loan payable to Zoucheng Science & Technology             (ii)
Bureau, non-interest bearing, 50% of the loan was repaid in
2004 and other 50% was written off as other income at the end
of 2004                                                                                               --                    120,821
---------------------------------------------------------------- ------------- ----------------------------- -----------------------
Unsecured loan payable to Zoucheng Science & Technology             (iii)
Bureau, non-interest bearing, it is due in Kiwa-SD's first
profitable year, interest has not been imputed due to the
undeterminable repayment date                                                                    302,053                         --
---------------------------------------------------------------- ------------- ----------------------------- -----------------------
Total                                                                                         $1,389,443                 $1,184,047
---------------------------------------------------------------- ------------- ----------------------------- -----------------------
</TABLE>

Notes:

(i.)    The unsecured loan payable  consists of amounts borrowed under a project
        agreement  with Zoucheng  Municipal  Government,  whereby the Company is
        allowed to borrow up to $1.2 million. The loan is non-interest  bearing,
        becoming due within three years from Kiwa-SD's first  profitable year on
        a formula basis. Interest has not been imputed due to the undeterminable
        repayment date.

        According  to  the  project  agreement,  Zoucheng  Municipal  Government
        granted the  Company  use of at least 15.7 acres in  Shandong  Province,
        China at no cost for 10 years to  construct  a  manufacturing  facility.
        Under the agreement,  the Company has the option to pay a fee of $58,696
        per acre for the land use right  after the 10-year  period.  The Company
        may not  transfer or pledge the  temporary  land use right.  The Company
        also  committed to invest  approximately  $18 million to $24 million for
        developing  the  manufacturing  and  research  facilities  in  Zoucheng,
        Shandong  Province.  As of  December  31,  2004,  the  Company  invested
        approximately  $1.4 million for the project.  Management  believes  that
        neither the Company nor management  will be liable for  compensation  or
        penalty if such commitment is not fulfilled.

(ii.)   The amount represents an unsecured  non-interest bearing loan payable to
        Zoucheng Science & Technology Bureau. 50% of the loan was repaid in 2004
        and other 50% was  waived  and  recorded  as other  income at the end of
        2004.

(iii.)  The amount was borrowed  from  Zoucheng  Science & Technology  Bureau in
        2004. It is non-interest  bearing,  unsecured and due in Kiwa-SD's first
        profitable year. Interest has not been imputed due to the undeterminable
        repayment date.


                                      -37-
<PAGE>

The  Company  qualifies  for  non-interest  bearing  loans  under  a  government
sponsored program to encourage  economic  development in certain  industries and
locations.  To qualify for the  favorable  loan terms,  a company  must meet the
following  criteria:  (1) be a technology company with innovative  technology or
product (as  determined by the Science  Bureau of the central  government);  (2)
operate in specific industries, such as agriculture,  environmental,  education,
and others,  which the  government  has  determined  are  important to encourage
development;  and (3) be located in undeveloped areas such as Zoucheng, Shandong
Province where the manufacturing facility of the Company is located.

13. Bank notes payable

Bank notes payable  (including  current  portion)  consisted of the following at
December 31 of the years indicated:

<TABLE>
<CAPTION>
----------------------------------------------------------------------- -------------------------- ----------------------
                                                                                  2004                     2003
----------------------------------------------------------------------- -------------------------- ----------------------
<S>                                                                                       <C>                    <C>
Note payable to a bank, payable in monthly installments of
$735 secured by an automobile, bearing an interest rate of 5.32% per
annum, maturing in October 2007.                                                          $23,159                $30,536
----------------------------------------------------------------------- -------------------------- ----------------------
Note payable to a bank, payable in quarterly installments of
principle equal to $1,275, secured by an automobile, bearing an
interest rate of 5.02% per annum, maturing in March 2008.                                  16,573                 21,673
                                                                                           ------                 ------
----------------------------------------------------------------------- -------------------------- ----------------------
Total                                                                                     $39,732                $52,209
                                                                                          =======                =======
----------------------------------------------------------------------- -------------------------- ----------------------
</TABLE>

Maturities of notes payable as of December 31, 2004 are as follows:

<TABLE>
<CAPTION>
------------------------------ --------------------------------------------------------
        Years Ending                                   Amount
         December 31
------------------------------ --------------------------------------------------------
<S>                                                                            <C>
            2005                                                               $12,879
            2006                                                                13,303
            2007                                                                12,276
            2008                                                                 1,274
------------------------------ --------------------------------------------------------
            Total                                                              $39,732
                               ========================================================
</TABLE>

14. Equity-Based Transactions

(a)      Authorized share capital

On June 3, 2004, a majority of the Company's  stockholders approved an amendment
to the Company's  Second Restated and Amended  Articles of  Incorporation to (a)
increase from 50,000,000 to 100,000,000  the authorized  number of shares of the
Company's  common stock and (b) authorize  20,000,000  shares of preferred stock
(the rights,  preferences,  privileges and  restrictions to be determined by the
Board of Directors). The amendment was effective on July 16, 2004.

(b)      Issued and outstanding share capital

From  January 1, 2003 to  December  31,  2004,  the  Company  has engaged in the
following equity-based transactions:

On December 31, 2003,  the Company issued  18,535,006  shares of common stock in
exchange for consulting  services provided by various  consultants and directors
of the Company.

In  conjunction  with the March  2004  reverse  merger  transaction  (see  under
"Organization"  in Note 1), the Company entered into the following  equity-based
transactions:


                                      -38-
<PAGE>

a. In exchange for 100% of the issued and  outstanding  shares of Kiwa Bio-Tech,
the Kiwa Bio-Tech  stockholders were issued 30,891,676 shares of Tintic's common
stock.

b. The  stockholders of Tintic  retained their 4,038,572  shares of common stock
which  were  issued  and  outstanding  prior to the  consummation  of the Merger
Agreement.

c. Tintic assumed 1,852,501 stock options issuable by Kiwa Bio-Tech at March 12,
2004.

d.  Effective  March 11,  2004,  the Company  issued a warrant to its  financial
advisor to purchase  1,747,000  shares of common stock  exercisable at $0.20 per
share  for six  years.  The fair  value of this  warrant  was  determined  to be
approximately  $0.54  per share  pursuant  to the  Black-Scholes  option-pricing
model.  The  aggregate  fair value of such  warrant of  $943,380  was charged to
operations as reverse merger costs during the year ended December 31, 2004.

e.  Effective  March 30, 2004, the Company issued a stock option to a consultant
to purchase  300,000  shares of common stock  exercisable at $0.20 per share for
ten years.  The fair value of this  option was  determined  to be  approximately
$0.57  per  share  pursuant  to the  Black-Scholes  option  pricing  model.  The
aggregate  fair value of such option of $171,000  was charged to  operations  as
reverse merger costs during the year ended December 31, 2004.

On April 12, 2004, the Company entered into an agreement with China Agricultural
University  to  acquire  patent no. ZL  93101635.5  entitled  "Highly  Effective
Composite  Bacteria  for  Enhancing  Yield  and  the  Related   Methodology  for
Manufacturing",  which was  originally  granted by the PRC Patent Bureau on July
12, 1996. The purchase  consideration was $480,411, of which $30,205 was paid at
signing of the agreement and an additional $30,205 was paid in December 2004. In
addition,  the Company issued  1,000,000  shares of common stock valued at $0.42
per share  based on its fair  market  value on July 19,  2004  (aggregate  value
$420,000), the date when the application for the patent right holder alternation
registration was approved.

On May 24, 2004,  the Company  entered  into a contract  with  Cinapsys  Inc. to
provide investor  relations  services.  The engagement is for a period of twelve
months and provides for a monthly  retainer of $4,000 and the issuance of 75,000
shares of common stock.  The Company recorded a prepaid expense of $33,750 based
on the closing price of its common stock on the effective  date of the agreement
and is amortizing such amount to operations  over the 12 month contract  period.
On  September  27,  2004,  the Company  terminated  the  engagement  letter with
Cinapsys  Inc.  according to the  termination  clause and the Board of Directors
authorized  the  issuance of the above  75,000  common  shares to Cinapsys  Inc.
Accordingly, the prepaid expense was written off in 2004.

On  July 6,  2004,  the  Company  entered  into a  Standby  Equity  Distribution
Agreement  with Cornell  Capital  Partners,  LP ("Cornell  Capital").  Under the
Standby  Equity  Distribution  Agreement,  the Company  may, at its  discretion,
periodically issue and sell to Cornell Capital common stock for a total purchase
price of up to  $10,000,000,  subject to further  limitations  noted in the next
paragraph.  The  purchase  price for the  shares  is equal to 99% of the  market
price,  which is defined in the Standby  Equity  Distribution  Agreement  as the
lowest volume weighted average price of the common stock during the five trading
days following the notice date.  Cornell Capital received a one-time  commitment
fee of 704,039 shares of the Company's  common stock following  execution of the
Agreement  on July 29, 2004,  which was treated as a reduction of the  proceeds.
Cornell  Capital will be paid a fee equal to 4% of each advance,  to be retained
from each advance.  As a result,  our proceeds from the sale of shares under the
Standby Equity Distribution  Agreement will be equal to 95% of the market price,
calculated  as  described   above.   In  connection   with  the  Standby  Equity
Distribution  Agreement,  the  Company  also  entered  into  a  Placement  Agent
Agreement with Newbridge Securities Corporation, a registered broker-dealer.  On
July 29, 2004,  the Company paid  Newbridge  Securities  Corporation  a one-time
placement  agent  fee  of  26,567  shares  of  common  stock  with  a  value  of
approximately  $10,000  based  on  the  volume  weighted  average  price  of the
Company's  common stock as quoted by Bloomberg,  LP on the date of the Placement
Agent  Agreement  which was treated as a reduction of the proceeds.  The Company
registered  the  shares of  common  stock  issuable  under  the  Standby  Equity
Distribution  Agreement for resale by Cornell  Capital  pursuant to Registration
Statement on Form SB-2 (No.  333-117868),  which was  declared  effective by the
Securities and Exchange Commission in December 2004.

The amount of stock the Company may sell under the Standby  Equity  Distribution
Agreement at one time is subject to a maximum  advance amount of $500,000,  with
no cash advance occurring within seven trading days of a prior advance,  and the
Company may not request cash  advances if the shares to be issued in  connection
with an advance  would  result in Cornell  Capital  owning more than 9.9% of the
Company's  outstanding common stock. Based on the Company's current  outstanding
shares of  40,873,711,  it could  not issue  shares  under  the  Standby  Equity
Distribution  Agreement if it would result in Cornell  Capital  owning more than
4,491,118 shares.  Assuming a price of $0.02 per share, the closing price of the
Company's  common stock on March 22, 2005, and the issuance of 4,491,118  shares
under the Standby Equity Distribution  Agreement would result in proceeds to the
Company of approximately $85,331 after taking into account fees and discounts..


                                      -39-
<PAGE>

On September  14, 2004,  the Company  issued  892,857  shares of common stock to
Stubbs  Alderton and  Markiles,  LLP,  with an aggregate  value of $125,000,  as
payment for legal fees incurred during 2004.

On October 1, 2004, the Company entered a Consulting  Agreement with Amy L.Yi to
provide  investor  relations  services.  The  engagement  is for a period of six
months and  provides  for the issuance of 200,000  shares of common  stock.  The
Company  recorded a prepaid expense of $20,000 based on the closing price of its
common stock on the  effective  date of the  agreement  and is  amortizing  such
amount to operations over the six month contract period.

On October 1, 2004,  the  Company  entered a  Consulting  Agreement  with Robert
Sullivan to provide investor relations services.  The engagement is for a period
of three months and provides for the issuance of 165,000 shares of common stock.
The Company  recorded a prepaid expense of $16,500 based on the closing price of
its common stock on the effective  date of the agreement and is amortizing  such
amount to operations over the three month contract period.

On October 1, 2004,  the Company  entered a Consulting  Agreement  with Barry R.
Clark to provide investor relations services.  The engagement is for a period of
four months and provides for the issuance of 200,000 shares of common stock. The
Company  recorded a prepaid expense of $20,000 based on the closing price of its
common stock on the  effective  date of the  agreement  and is  amortizing  such
amount  to  operations  over the four  month  contract  period.  After one month
service,  the Company terminated the engagement with Barry R. Clark according to
the termination clause and the Board of Directors authorized the cancellation of
150,000  S-8 stock  certificates  issued to Barry R. Clark and the  issuance  of
30,000 shares of restricted stock to Barry R. Clark as final compensation, which
has been recognized as consulting expenses as of December 31, 2004.

(c) Option

On June 3, 2004, a majority of the Company's  stockholders approved the adoption
of the  Company's  2004 Stock  Incentive  Plan (the  "Plan").  The plan reserved
1,047,907 shares of the Company's common stock for the issuance of stock options
and stock purchase  rights under the Plan, of which not more than 350,000 shares
may be granted to any participant in any fiscal year.

The  options  of the Plan  will  expire  ten years  from the date of grant.  The
options  which are not issued to an officer,  a director or a  consultant,  will
become exercisable at least as rapidly as 20% per year over the five-year period
commencing  on the date of grant.  As of December  31,  2004 and 2003,  no stock
options or stock purchase rights had been granted under the Plan.

15. Major Customers and Suppliers

Three  customers  accounted for 46.1%,  26.3% and 18.5% of our net sales for the
fiscal year ended December 31, 2004. No other single customer accounted for more
than  10% of our  revenues.  The  revenue  from  Chinese  and  South-East  Asian
customers accounted for 53.9% and 46.1% respectively.  We generated revenue from
sales of $40,031 to two customers in the fourth quarter of the fiscal year ended
December 31, 2003.

Three suppliers  accounted for 49.2%,  27.6%,  and 4.1% of our net purchases for
the fiscal year ended  December 31, 2004. The raw materials used in our products
are available from a variety of alternative sources.

16. Taxation

In accordance  with the relevant tax laws in China,  Kiwa-SD  would  normally be
subject to a corporate income tax rate of 30% on its taxable income. However, in
accordance with the relevant tax laws in China, Kiwa-SD is exempt from corporate
income taxes for its first two profit  making years and is entitled to a 50% tax
reduction  for the  succeeding  three  years.  Kiwa-SD has not  provided for any
corporate  income  taxes  since it had no  taxable  income  for the years  ended
December 31, 2004 and 2003.

In accordance  with the relevant tax laws in the British  Virgin  Islands,  Kiwa
Bio-Tech Products Group Ltd., as an International  Business  Company,  is exempt
from income taxes.


                                      -40-
<PAGE>

As of December  31, 2004 and 2003,  the  Company  has no material  deferred  tax
assets or deferred tax liabilities.

A  reconciliation  of the provision for income taxes determined at the statutory
average state and local income taxes to the Company's  effective income tax rate
is as follows:

<TABLE>
<CAPTION>
------------------------------------ ---------------------------------- ---------------------------------
                                                   2004                               2003
------------------------------------ ---------------------------------- ---------------------------------
<S>                                                             <C>                               <C>
Statutory income tax                                             33%                               33%
Impact of effective tax exemption                               (33%)                             (33%)
                                     ---------------------------------- ---------------------------------
------------------------------------ ---------------------------------- ---------------------------------
Effective rate                                                     --                               --
</TABLE>

17. Lease Commitments

The Company has the following material contractual obligations:

Operating  lease  commitments - The Company leases an office in Beijing under an
operating  lease expiring in April 2005 with an aggregate  monthly lease payment
of  approximately  $2,882.  Rent expense under the operating  lease for the year
ended  December  31,  2004 and 2003 was $31,703 and  $27,570,  respectively.  At
December 31, 2004, the Company's  future  minimum lease payments  required under
the operating lease are $11,528 for the year ending April 2005.

The  Company  leases an office in the United  States  under a  commercial  lease
agreement with China Star expiring in June 2005 with an aggregate  monthly lease
payment of approximately  $2,560.  Pursuant to agreement,  rent expenses for the
year ended  December 31, 2004 was $21,904.  At December 31, 2004,  the remaining
minimum lease payments amounted to $12,800.

18. Retirement Plan

As stipulated by the regulations of the Chinese government,  Kiwa-SD has defined
contribution  retirement  plans for their employees.  The Chinese  government is
responsible for the pension  liability to these retired  employees.  The Company
was required to make specified  contributions to the state-sponsored  retirement
plan at 20% of the basic  salary cost of their staff.  Each of the  employees of
the PRC  subsidiaries is required to contribute 8% of his/her basic salary.  For
the year ended  December  31, 2004 and 2003,  contributions  made by the Company
were approximately $26,146 and $19,005, respectively.

19. Subsequent Events

On January 4, 2005,  as amended by letter  agreements  dated  March 21, 2005 and
April 5, 2005, the Company  completed a loan  transaction  pursuant to which the
Company received an advance of $400,000 (before  deduction of expenses and fees)
from Cornell Capital in exchange for the issuance by the Company of a promissory
note in the original  principal amount of $400,000 (the "Note").  The Note bears
interest  at a rate of 10% per annum and has a term of 290 days.  The  Company's
obligations under the Note may be paid from, among other funds, the proceeds the
Company receives pursuant to the Standby Equity  Distribution  Agreement entered
into with Cornell Capital on July 6, 2004, described at Note 14. Pursuant to the
terms of the Note,  the Company  deposited  in escrow 39 requests  for  advances
under the Standby  Equity  Distribution  Agreement in the amount of $10,000 each
and one request in the amount of $29,589,  as well as  sufficient  shares of the
Company's  Common  Stock  registered  pursuant  to  the  Company's  Registration
Statement No. 333-117868 to cover the advances. An attorney will serve as escrow
agent in  connection  with the  advance  notices and shares to be  deposited  in
escrow  pursuant  to the Note.  Unless  the Note is repaid by the  Company,  the
escrow agent will release such  requests for advances to Cornell  Capital  every
seven days  commencing on January 10, 2005 and Cornell  Capital may then, at its
discretion,  apply the proceeds from the advance to the  outstanding  balance on
the Note. In addition, the Note contains customary events of default and permits
Cornell Capital to accelerate the maturity of the full principal amount together
with  interest and other  amounts  owing upon the  occurrence  of such events of
default.


                                      -41-
<PAGE>

Item 8. Changes in and Disagreements With Accountants on Accounting and
        Financial Disclosure

None.

Item 8A. Controls and Procedures

Under the supervision and with the  participation  of management,  including the
Chief  Executive  Officer and Chief  Financial  Officer,  we have  evaluated the
effectiveness of our disclosure controls and procedures pursuant to Exchange Act
Rule 13a-15(b) as of the end of the period covered by this report. Based on that
evaluation,  the Chief  Executive  Officer  and  Chief  Financial  Officer  have
concluded that these  disclosure  controls and  procedures are effective.  There
were no changes in the  Company's  internal  control  over  financial  reporting
during the quarter ended December 31, 2004 that have materially affected, or are
reasonably  likely to materially  affect,  our internal  control over  financial
reporting.

We plan to  evaluate  the  level  of our  internal  controls,  identify  certain
possible  matters  involving  internal  control  deficiencies and adopt remedial
measures  according  to the COSO  framework  in 2005  with the  assistance  of a
professional   internal  control   consultant.   We  believe  we  can  meet  the
requirements as defined in Section 404 of Sarbanes-Oxley  Act of 2002 by the end
of 2006.

Item 8B. Other Information

Not applicable.

                                    PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
        With Section 16(a) of the Exchange Act

Information regarding our directors,  executive officers,  promoters and control
persons,  and regarding our compliance with Section 16(a) of the Exchange Act is
incorporated  herein by reference to the information  included in our definitive
proxy  statement  for  use  in  connection  with  our  2005  Annual  Meeting  of
Shareholders to be filed with the Securities and Exchange  Commission within 120
days after the end of our 2004 fiscal year.

Item 10. Executive Compensation

Information regarding executive compensation is incorporated herein by reference
to the information included in our 2005 proxy statement.

Item 11.  Security  Ownership of Certain  Beneficial  Owners and  Management And
          Related Stockholder Matters

Information  regarding  security  ownership  of  certain  beneficial  owners and
management and related  stockholder  matters is incorporated herein by reference
to the information included in our 2005 proxy statement.

Item 12. Certain Relationships and Related Transactions

Information   regarding  certain   relationships  and  related  transactions  is
incorporated  herein by reference to the information  included in our 2005 proxy
statement.


                                      -42-
<PAGE>

Item 13. Exhibits

Exhibits

These exhibits are numbered in accordance  with the Exhibit Table of item 601 of
Regulation S-K.

<TABLE>
<CAPTION>
 Exhibit                              Description                             Incorporated by Reference in        Exhibit No. in
   No.                                                                                  Document                   Incorporated
                                                                                                                     Document
<S>            <C>                                                        <C>                                   <C>
2.1            Agreement and Plan of Merger, dated March 11, 2004, by     Form 8-K filed on March 29, 2004      2.1
               and  among  Tintic  Gold  Mining Company, TTGM
               Acquisition Corporation, and Kiwa
               Bio-Tech Products Group Ltd.
2.2            Agreement and Plan of Merger, dated July 22, 2004,         Form 8-K filed on July 23, 2004       2.1
               between Kiwa Bio-Tech Products Group Corporation, a Utah
               corporation, and Kiwa Bio-Tech Products Group
               Corporation.
3.1            Certificate  of  Incorporation,  effective as of July 21,  Form 8-K filed on July 23 2004        3.1
               2004.
3.2            Bylaws, effective as of July 22, 2004.                     Form 8-K filed on July 23, 2004       3.2
10.1           Standby Equity Distribution Agreement, dated July 6,       Form SB-2 filed August 2, 2004        10.1
               2004, between Cornell Capital Partners, LP and Kiwa
               Bio-Tech Products Group Corporation.
10.2           Placement Agent Agreement, dated July 6, 2004, between     Form SB-2 filed August 2, 2004        10.2
               Newbridge Securities Corporation and Kiwa Bio-Tech
               Products Group Corporation.
10.3           Registration Rights Agreement, dated July 6, 2004,         Form SB-2 filed August 2, 2004        10.3
               between Cornell Capital Partners, LP and Kiwa Bio-Tech
               Products Group Corporation.
10.4           Warrant Purchase Agreement, dated March 12, 2004,          Form 10-QSB filed May 20, 2004        10.1
               issued to Westpark Capital, Inc.
10.5           Convertible Loan Agreement, dated January 25, 2004         Form 10-QSB filed May 20, 2004        10.2
               between Kiwa Bio-tech Products Group Ltd. and Kao Ming
               Investment Company
10.6           Convertible  Loan Agreement dated March 12, 2004 for       Form 10-QSB filed August 20, 2004     10.1
               $200,000  between Kiwa Bio-Tech  Products Group
               Corporation and Jzu Hsiang Trading Co., Ltd.
10.7           Engagement  agreement between Kiwa Bio-Tech Products       Form 10-QSB filed August 20, 2004     10.3
               Group Corporation and Cinapsys Inc. dated May 24, 2004
10.8           Patent Transfer Agreement dated April 12, 2004, between    Form SB-2/A filed October 8, 2004     10.5
               Kiwa Bio-Tech Products (Shandong) Co., Ltd. and China
               Agricultural University.
10.9           Patent Transfer Contract, dated April 12, 2004,  between   Form SB-2/A filed November 23, 2004   10.5
               Kiwa Bio-Tech Products Group Corporation and China
               Agricultural University
10.10          Contract of Project of Venture Capital of Zoucheng         Form SB-2/A filed October 8, 2004     10.6
               Science & Technology Plan (Contract No.: 2004) among
               KIWA Bio-Tech Products (Shandong)  Company,  Science &
               Technology Bureau and Zoucheng Branch of China Commercial
               Bank of ICBC dated April 2004.
10.11          Contract of Project of Venture Capital of Zoucheng         Form SB-2/A filed October 8, 2004     10.7
               Science & Technology Plan (Contract  No. 2002) among
               KIWA Bio-Tech Products (Shandong)  Company, Zoucheng
               Science & Technology Bureau and Zoucheng Branch of China
               Commercial Bank of ICBC. dated November 2002.
</TABLE>


                                      -43-
<PAGE>

<TABLE>
<S>            <C>                                                        <C>                                   <C>
10.12          Contract of Project of Venture Capital of Zoucheng         Form SB-2/A filed November 23, 2004   10.7
               Science & Technology Plan (Contract  No. 2002) among
               KIWA Bio-Tech Products Group Limited, Zoucheng Municipal
               People's Government
               Bureau and Zoucheng Branch of China Commercial Bank of
               ICBC dated May 26, 2002.
10.13          PBC Project Investment Agreement between KIWA Bio-Tech
               Products Group Limited and Zoucheng Municipal Government
               dated June 25, 2002
10.14          Employment   Agreement  dated  March  18,  2003            Form SB-2/A filed November 23, 2004   10.13
               between  Kiwa Bio-Tech Products Group and Lian jun Luo
10.15          Employment   Agreement  dated  March  18,  2003            Form SB-2/A filed November 23, 2004   10.14
               between  Kiwa Bio-Tech Products Group and Bin Qu
               Convertible Loan Agreement dated October 20, 2003          Form SB-2/A filed October 8, 2004     10.8
10.16          between China Star Investment Group and Kiwa Bio-Tech
               Products Group Ltd., as amended by letter agreement
               dated August 1, 2004
10.17          Loan Agreement dated July 26, 2004 between China Star      Form SB-2/A filed November 23, 2004   10.15
               Investment Group and Kiwa Bio-Tech Products Group
               Corporation
10.18          Commercial Lease Agreement dated April 1, 2004 between     Form SB-2/A filed October 8, 2004     10.10
               Kiwa Bio-Tech Products Group Corporation and China Star
               Investment Company.
10.19          Convertible Note Agreement dated September 23, 2004        Form 10-QSB filed November 15, 2004   10.4
               among Kiwa Bio-Tech Products Group Corporation and Young
               San Kim and Song N. Bang
10.20          Amendment, dated April 7, 2005, to Convertible Note
               Agreement dated September 23, 2004 among Kiwa Bio-Tech
               Products Group Corporation and Young San Kim and Song N.
               Bang
10.21          Common Stock Warrant dated September 23, 2004,  issued     Form 10-QSB filed November 15, 2004   10.5
               by Kiwa Bio-Tech Products Group Corporation to Young San
               Kim
10.22          Common Stock Warrant dated September 23, 2004, issued by   10-QSB filed November 15, 2004        10.6
               Kiwa Bio-Tech Products Group Corporation to Song N. Bang
10.23          Promissory Note of Kiwa Bio-Tech Products Group
               Corporation, principal amount $400,000, issued to
               Cornell Capital Partners, LP on January 4, 2005, as
               amended by letter agreements dated March 21, 2005 and
               April 5, 2005.
31.2           Certification of Principal Financial Officer pursuant to
               Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act
               of 1934
32.1           Certifications of Principal Executive Officer, pursuant
               to 18 U.S.C. 1350, as adopted pursuant to Section 906 of
               the Sarbanes-Oxley Act of 2002
32.2           Certifications of Principal Financial Officer, pursuant
               to 18 U.S.C. 1350, as adopted pursuant to Section 906 of
               the Sarbanes-Oxley Act of 2002
</TABLE>


                                      -44-
<PAGE>

Item 14. Principal Accounting Fees and Services.

Information regarding principal accounting fees and services and is incorporated
herein by reference to the information included in our 2005 proxy statement.

                                   SIGNATURES

                    KIWA BIO-TECH PRODUCTS GROUP CORPORATION
                                  (Registrant)

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized on April 13, 2005.

/S/ LI WEI

---------------------------
Wei Li
Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1934, this report has been
signed below by the  following  persons on behalf of the  registrant  and in the
capacities indicated on April 13, 2005.

/S/ LIAN JUN LUO           April 13, 2005       Chief Financial Officer and
                                                Director
-----------------------
Lian jun Luo

 /S/ JAMES NIAN ZHAN       April 13, 2005       Secretary and Director

-----------------------
James Nian Zhan

 /S/ DA CHANG JU           April 13, 2005       Director

-----------------------
Da chang Ju

 /S/ YUN LONG ZHANG       April 13, 2005       Director

-----------------------
Yun long Zhang


                                      -45-