EXHIBIT
      10.16

     

    Mortgage
      Contract of Maximum Amount 

    


    


    Mortgagee
      (Party A): Winner Medical & Textile Ltd. Jingmen

    Address:
      

    Legal
      Representative: Jianquan Li 

     

    Mortgagor
      (Party B): Jingmen Branch of Industrial and Commercial Bank of
      China

    Address:
      

    Legal
      Representative(Person in Charge): Jie Zhang

     

    Whereas:
      Winner
      Medical & Textiles Ltd. Jingmen (hereinafter also referred to as “Debtor”)
      and the Mortgagee have entered into a serial of Loan Agreements (hereinafter
      referred to as “Loan Agreements”) with the loan period from June 11th
      2004 to
      June 10th
      2007 and
      under the maximum amount of RMB Four Million Nine Hundred Thousand Yuan Only.
      The Mortgagor undertakes to provide security to secure the indebtedness of
      the
      Debtor under the Loan Agreements. In accordance with relevant PRC laws and
      regulations and through friendly negotiation, the Parties agree to enter into
      this Contract:

    


    Article
      1 Undertakings And Presentations By Party A

    
      	1.1	
              Party
                A is the full, effective and lawful owner or the State-authorized
                administrator of the collateral under this Contract; there is no
                dispute
                regarding the ownership or right of administration for the
                collateral;

            


    

    


    
      	1.2	
              Party
                A fully understands the purpose of the loan under the Loan Agreements
                and
                has provided the security under this Contract of its own will;
                

            


    

    


    
      	1.3	
              Party
                A has disclosed and explained all defect of rights of the
                collateral;

            


    

    


    
      	1.4	
              The
                collateral under this Contract is allowed by law to be mortgaged
                freely;

            


    

    


    
      	1.5	
              There
                is no restriction against the establishment of the
                mortgage;

            


    

    


    
      	1.6	
              There
                is no seizure, attachment or supervision existing over the
                collateral;

            


    

    


    
      	1.7	
              In
                case that Party A leases the collateral to other party, Party A shall
                notify the Lessee of the mortgage and notify Party B of the lease
                in
                writing.

            


    

     

     

    
      
         

      

      
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Article
      2 Indebtedness To Be Secured and Amount

    The
      mortgage under this Contract is to secure the indebtedness owed by the Debtor
      to
      the Mortgagee derived from all the bank loans in RMB granted by Party B under
      the Loan Agreements for the period and within the maximal amount as stipulated
      in this Contract. 

    


    Article
      3 Term of Loan 

    The
      term
      of the loan shall be determined by the Loan Agreements. 

    


    Article
      4 Scope of Guarantee

    The
      security under this Contract shall be to secure all of the loan principal,
      interest, penalty interest, breach of contract compensation and all the expenses
      incurred in realizing the Mortgagee’s right and other fees payable.


    


    Article
      5 Collateral

    
      	5.1	
              The
                collateral under this Contract is described in detail in the List
                of
                Collateral.

            


    

    


    
      	5.2	
              The
                estimated value of the collateral contained in the abovementioned
                List of
                Collateral is not final and shall impose no restriction on the disposal
                of
                the collateral by Party B in accordance with Article 9 of this
                Contract.

            


    

    


    
      	5.3	
              The
                relevant certificate and materials of the collateral shall be kept
                by
                Party B unless otherwise stipulated by laws.


            


    

    


    Article
      6 Registration

    
      	6.1	
              The
                Parties shall register the mortgage within 15 days after execution
                of this
                Contract as required by laws or agreed by both
                Parties.

            


    

    


    
      	6.2	
              The
                Parties shall alter the registration within 15 days in case of alteration
                of the mortgage as required by
                laws.

            


    

    


    Article
      7 Possession and Management of the Collateral

    
      	7.1	
              The
                collateral shall be possessed and managed by Party A. Party A shall
                maintain the integrity of the collateral and shall not impair the
                value of
                the collateral through improper utilization. Party B is entitled
                to
                supervise the possession and management of the
                collateral.

            


    

     

     

    
      
         

      

      
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      	7.2	
              In
                case of loss or damage to the collateral, Party A shall notify Party
                B
                timely and take necessary efforts to minimize the loss. Party A shall
                also
                provide Party B with necessary proof of the loss or damage issued
                by the
                relevant authorities. 

            


    

    


    Article
      8 Insurance

    
      	8.1	
              Party
                A shall purchase property insurance for the collateral within 15
                days
                after execution of this Contract. The insured period shall be no
                shorter
                than the loan term under the Loan Agreements and the insured value
                shall
                be no less than the principal and interest of the
                loan.

            


    

    


    
      	8.2	
              Party
                B shall be the first beneficiary under such insurance. There shall
                be no
                restriction of Party B’s interest and right under such insurance.
                

            


    

    


    
      	8.3	
              Party
                B should not terminate or cancel the insurance for any reason during
                the
                valid period of this Contract. Party B is entitled to renew the insurance
                at the cost of Party A in case of termination of the
                insurance.

            


    

    


    
      	8.4	
              The
                insurance compensation shall be used to repay the bank loan under
                the Loan
                Agreements or to restore the value of the collateral as agreed by
                Party
                B.

            


    

    


    Article
      9 Realization of Security

    
      	9.1	
              In
                realizing the Mortgagee’s right in accordance with laws, Party B is
                entitled to use the collateral to make up for the indebtedness as
                agreed
                by both Parties or settle the outstanding indebtedness by the proceeds
                derived from the sale or auction of the
                collateral.

            


    

    


    
      	9.2	
              Party
                A shall assist Party B to realize its right and shall not cause any
                hindrance. 

            


    

    


    Article
      10 Rights and Obligations of Party A

    
      	10.1	
              After
                effectiveness of this Contract, Party A shall not create any mortgage,
                pledge on the collateral or lease, transfer or donate the collateral
                to
                any third party without getting written consent from Party
                B.

            


    

    


    
      	10.2	
              The
                amendment to the Loan Agreement by Party B and the Debtor shall not
                affect
                the security under this Contract.

            


    

    


    
      	10.3	
              In
                case of devaluation of the collateral due to Party A’s conduct, Party A
                shall cease such conduct and restore the value of the collateral
                or
                provide extra security.

            


    

    


    
      	10.4	
              In
                case of devaluation of the collateral due to reasons other than Party
                A’s
                fault, Party A will bear the obligation of security only within the
                limitation of the compensation received by Party A. The remaining
                collateral shall also be mortgaged to secure the indebtedness of
                the
                Debtor.

            


    

     

    
      
         

      

      
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      	10.5	
              In
                case of expropriation of the collateral by the State, the relevant
                compensation shall be used to settle the indebtedness of the Debtor
                before
                maturity or be deposited in a third party designated by both
                Parties.

            


    

    


    
      	10.6	
              Party
                A shall bear all the expense and cost under this Contract such as
                lawyer’s
                fee, insurance, authentication, notary, evaluation, registration,
                transfer
                and litigation etc.

            


    

    


    
      	10.7	
              Party
                A shall make proper arrangement about the security in case of division,
                merger, and share transfer of Party
                A.

            


    

    


    
      	10.8	
              In
                case of damage or possible damage by third party to the collateral,
                Party
                A shall notify Party B in time and assist Party B to prevent further
                damage.

            


    

    


    
      	10.9	
              Party
                A shall notify Party B in writing in case
                of:

            


    

     

    
      	
            	§	
              major
                change of its management system;

            


    

    
      	
            	§	
              change
                of its business scope, registered capital and shareholding
                structure;

            


    

    
      	
            	§	
              involvement
                of major economic dispute;

            


    

    
      	
            	§	
              dispute
                over ownership of the collateral;

            


    

    
      	
            	§	
              bankruptcy,
                cessation of operation, dissolution, revoking of business license
                etc.;

            


    

    
      	
            	§	
              change
                of its address, contact number or legal
                representative.

            


    

    


    
      	10.10	
              Under
                the circumstances stated in 10.9.1 or 10.9.2, Part A shall give 30-day
                prior written notification to Party B. Under other circumstances
                stated in
                10.9, Party A shall give written notification to Party B within 5
                days
                after the occurrence of such event.


            


    

    


    
      	10.11	
              Party
                A is entitled to cancell the mortgage once all indebtedness under
                the Loan
                Agreement has been paid.

            


    

    


    Article
      11 Rights and Obligations of Party B

    
      	11.1	
              Party
                B is entitled to dispose collateral in case of failure by the Debtor
                to
                pay the loan principal, interest or other fees upon due
                date;

            


    

    


    
      	11.2	
              Party
                B is entitled to dispose the collateral in case
                that:

            


    

    
      	
            	§	
              The
                Loan Agreement is terminated in accordance with laws or as stipulated
                in
                the Loan Agreement;

            


    

    
      	
            	§	
              The
                loan becomes mature before expiry of term in accordance with the
                Loan
                Agreement and the indebtedness under the Loan Agreement has not been
                settled.

            


    

     

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

     

    
      	11.3	
              Party
                B is entitled to ask for Party A’s assistance in its effort toprevent
                damage of the collateral by any third
                party.

            


    

    


    
      	11.4	
              After
                the realization of the security, Party B shall assist Party A’s execution
                of recourse against the Debtor.

            


    

    


    
      	11.5	
              Party
                B shall repay the residual proceeds of the collateral to Party A
                once all
                secured indebtedness has been paid.

            


    

    


    Article
      12 Breach of Contract

    
      	12.1	
              Party
                A shall compensate Party B for any loss due to false statements or
                undertakings by Party A;

            


    

    


    
      	12.2	
              Both
                Parties shall perform their obligations under this Contract strictly
                after
                the effectiveness of this Contract. The breaching party shall compensate
                the other party any loss suffered due to its breach of
                contract.

            


    

    


    
      	12.3.	
              In
                case that this Contract becomes invalid due to fault of Party A,
                Party A
                shall compensate Party B for all loss within the limitation of the
                security amount. 

            


    

    


    Article
      13 Effectiveness, Amendment and Termination

    
      	13.1	
              This
                Contract shall come into effect once it is signed and stamped by
                both
                Parties and registered with competent authorities as required by
                laws.

            


    

    


    
      	13.2	
              This
                Contract is independent from the Loan Agreement. The invalidity of
                the
                Loan Agreement shall not affect the validity of this Contract. Party
                A
                shall perform its obligations of guarantee under this Contract regardless
                of the invalidity of the Loan
                Agreement.

            


    

    


    
      	13.3	
              This
                Contract may be amended or terminated by both Parties in writing.
                

            


    

    


    Article
      14 Dispute Settlement

    Any
      dispute arising from this Contract shall be settled by litigation in the
      People’s Court located in the region of Party B.

    


    Article
      15 Other Issues

    N/A

    


    Article
      16 Attachment

    
      	16.1	
              The
                attachment is an integral part of this Contract and has the same
                legal
                effect as this Contract.

            


    

    


    
      	16.2	
              The
                attachment to this Contract includes the List of
                Collateral.

            


    

    


    Article
      17 Originals

    This
      Contract has 3 originals, Party A, Party B and the registration authority shall
      retain 1 original each, and they are of the same legal effect. 

    


     

    Party
      A: Winner Medical & Textiles Ltd. Jingmen

    Legal
      representative: Jianquan Li

    


    Party
      B: Jingmen Branch Of Industrial and Commercial Bank of
      China

    Authorized
      representative: Jie Zhang

    


    Date:
      June 11th,
      2004

    
      	 	 	 	 
	 	 	 	 
	
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