Document:

EXHIBIT 10.6

    

      Cooperation
        Agreement

       

      This
        Agreement (this “Agreement”) is made and entered into by and between the
        following Parties on January 15, 2008 in Beijing, the People's Republic of
        China
        (“China” or the “PRC”).

       

      

       

      
        	
                Party
                  A: 

              	
                Inner
                  Mongolia Yongye Biotechnology Co. Ltd.

                 

              
	
                Address:

              	
                Yongye
                  Industrial Park, Jinshan Ave, Jinshan Development District, Huhehaote
                  City

                 

              
	 	    

	
                Party
                  B: 

              	
                Inner
                  Mongolia Yongye Nongfeng Biotechnology Co. Ltd.

                 

              
	
                Address:

              	
                Yongye
                  Industrial Park, Jinshan Ave, Jinshan Development District, Huhehaote
                  City

              

      

      

       

      Each
        of
        Party A and Party B shall be hereinafter referred to as a "Party" respectively,
        and as the "Parties" collectively.

       

      

       

      Whereas,

       

      
        	
                1)

              	
                Party
                  A is a limited liability company established in China, and has
                  the ability
                  to produce “ShengMingSu” and related products (the “Products”);

              

      

       

      
        	
                2)

              	
                Party
                  B is a sino-foreign cooperative joint venture established in China,
                  engaging in the promotion and sale of the Products (the “Business”)
                  as approved by the relevant governmental authorities in
                  China;

              

      

       

      
        	
                3)

              	
                Party
                  B is the holder of the patent, technique and trademarks (the “Intellectual
                  Property Rights”)
                  as set forth in Exhibit 1, and wishes to authorize Party A to use
                  Intellectual Property Rights to produce Products; Party A also
                  wishes to
                  accept Party B’s authorization to produce
                  Products.

              

      

       

      
        	
                4)

              	
                Party
                  A is willing to provide Party B with Products during the term of
                  this
                  Agreement, and Party B is willing to accept the above services
                  provided by
                  Party A on the terms set forth
                  herein.

              

      

       

      Now,
        therefore, through mutual discussion, the Parties have reached the following
        agreements:

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      Authorization
        of license:

       

      
        	 	
                .1

              	
                Party
                  B is willing to authorize Party A an internal use, non-exclusive,
                  non-assignable and non-sublicense license in China to capitalize
                  on the
                  Intellectual Property Rights to produce the Products.
                  

              

      

       

      
        	 	
                .2

              	
                Party
                  A agrees not to sell, lease or disclose the Intellectual Property
                  Rights
                  or any related documents and materials to any third
                  party.

              

      

       

      
        	 	
                .3

              	
                Party
                  A agrees not to decompile, disassemble or reverse-engineer the
                  Intellectual Property Rights, or develop derivative works of the
                  Intellectual Property Rights.

              

      

       

      
        	 	
                .4

              	
                Party
                  A confirms and agrees that all rights, ownership and interests
                  of the
                  Intellectual Property Rights, including but not limited to documents
                  and
                  materials, data and information (Products) and all copies or all
                  copies of
                  their any parts belong to and shall belong to Party B or related
                  third
                  parties. Party A is not entitled to and shall not try to obtain
                  rights,
                  ownership and interests of the Intellectual Property Rights, except
                  expressly prescribed in this Agreement. Party A confirms and agrees
                  that
                  Intellectual Property Rights include commercial secrets, property
                  information and confidential information, and Party A shall not
                  sell,
                  copy, amend, alter, modify and transfer the Intellectual Property
                  Rights,
                  except expressly permitted in this
                  Agreement.

              

      

       

      
        	 	
                .5

              	
                Execution
                  and any terms of this Agreement can not be interpreted as restricting
                  Party B to permit any third party to use the Intellectual Property
                  Rights
                  for producing Products.

              

      

       

      General
        Arrangement

       

      In
        accordance with terms and conditions of this Agreement, Party B hereby entrusts
        Party A to provide Party B with Products (the “Service”)
        in
        China during the term of this Agreement. The specific service includes those
        services described in the Party B’s business scope and required by Party B from
        time to time, including but not limited to the following:

       

      
        	 	
                .1

              	
                Party
                  A shall complete the production and delivery of the Products according
                  to
                  Party B’s instructions from time to time, and the Products shall meet the
                  standards set forth in Exhibit 2.

              

      

       

      
        	 	
                .2

              	
                During
                  the term of this Agreement, all the Products produced by Party
                  A according
                  to this Agreement, under Party B’s sole discretion, shall be exclusively
                  sold to the Party B or any third party appointed by Party B. Party
                  A shall
                  not sell any Product to any third party without prior written consent
                  of
                  Party B. However, Party A agrees that Party B can reach any supply
                  and
                  demand arrangement with any third party at any moment and shall
                  not be
                  restricted by articles of this Agreement during the term of this
                  Agreement.

              

      

       

      
        	 	
                .3

              	
                Party
                  A and Party B shall jointly build product quality-supervision systems
                  so
                  as to make the Products meet Party B’s
                  needs.

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      
        	 	
                .4

              	
                Party
                  B will supervise cost expenses in connection with raw material
                  procurement
                  and Product production process incurred by Party A, and Party A
                  agrees to
                  adjust raw material procurement and Product production policy according
                  to
                  suggestions proposed by the Party B from time to time so as to
                  decrease
                  cost of procurement and production.

              

      

       

      
        	 	
                .5

              	
                Party
                  A shall assist Party B in sale, promotion and after-sale services
                  of the
                  Products as required by Party B from time to
                  time.

              

      

       

      
        	 	
                .6

              	
                Upon
                  request by Party A, Party B can provide Party A with technique
                  materials
                    and technique requirements needed by Party A in connection with
                  supply of
                  Products to Party B, and train Party A’s
                  employees.

              

      

       

      
        	 	
                .7

              	
                Due
                  to business requirement, Party B is entitled to use all of Party
                  A’s
                  facilities, workplaces and equipment, and such use shall not unreasonably
                  rejected by Party A. Fees and expenses arising out of such use
                  shall be
                  determined in Exhibit 4 of this
                  Agreement.

              

      

       

      Product
        Supply Flow

       

      
        	 	
                .1

              	
                Party
                  B shall provide Party A with a name list of its employees who have
                  rights
                  to give orders to Party A (the “Eligible
                  Employee”),
                  and only those Eligible Employees are entitled to execute and give
                  out
                  orders.

              

      

       

      
        	 	
                .2

              	
                Form
                  of the supply order shall be determined by Party B. For details,
                  please
                  refer to Exhibit 3.

              

      

       

      
        	 	
                .3

              	
                Each
                  time after delivery of an order, Party A shall confirm the order
                  in
                  writing within three working days after delivery and organize the
                  production of the Products at the same time.

              

      

       

      
        	 	
                .4

              	
                Party
                  A shall finish production of the Product within 20 working days
                  after the
                  confirmation date of the order (if another date is agreed by the
                  Parties,
                  then shall refer to such agreed
                  date).

              

      

       

      Raw
        Material and Packaging

       

      
        	 	
                .1

              	
                All
                  raw material needed by Party A for the supply of the Product shall
                  have
                  prior written confirmation or approval from Party B, unless agreed
                  by the
                  Parties otherwise.

              

      

       

      
        	 	
                .2

              	
                The
                  packaging, trademarks and anti-counterfeit labels of the Product
                  provided
                  by Party A shall be confirmed and approved by Party B in
                  writing.

              

      

       

      Ownership
        and Delivery of Products

       

      
        	 	
                .1

              	
                After
                  production, Party A shall check the amount of the Products and
                  deliver
                  them to Party B at its production base. The Parties shall confirm
                  in
                  writing. Party B will examine the Products delivered by Party A
                  according
                  to the agreed standards. If any defect is found, Party B can reject
                  to
                  accept the Products. If any defect is identified after acceptance,
                  of the
                  delivered Products, Party B shall inform Party A such defect. Following
                  receipt of notice, Party A shall confirm and replace or dispose
                  of the
                  Products within agreed period of
                  time.

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      
        	 	
                .2

              	
                Party
                  B is responsible for transportation of all Products under this
                  Agreement
                  and bears the transportation fee and insurance
                  fee.

              

      

       

      
        	 	
                .3

              	
                Ownership
                  and risks of damage and loss of the Products shall be transferred
                  to Party
                  B at the time of delivery.

              

      

       

      Special
        Commitment of Party A

       

      
        	 	
                .1

              	
                Party
                  A shall guarantee that any supplied Products shall not infringe
                  intellectual property rights or any other rights and interests
                  of any
                  other parties. Otherwise, Party A shall indemnify Party B all relevant
                  losses.

              

      

       

      
        	 	
                .2

              	
                Without
                  permit of Party B, Party A shall not use technique materials provided
                  by
                  Party B to manufacture reserve or sell Products beyond Party B’s orders,
                  and shall not reserve samples of Products and related technique
                  materials
                  either. 

              

      

       

      Subsequent
        Arrangements

       

      
        	 	
                .1

              	
                The
                  existence of this Agreement and any term thereof shall not be interpreted
                  to restrict Party B’s ability to improve its production, to build its
                  manufacture facilities, lines and equipment so as to achieve
                  self-production and sale of Products in 2008.

              

      

       

      
        	 	
                .2

              	
                Within
                  two years after execution of this Agreement, Party A grants Party
                  B an
                  exclusive option to acquire all resources needed in connection
                  with
                  production of Products owned by Party A at a minimum purchase price
                  permitted by Chinese government or a book price, including but
                  not limited
                  to equipment, manufacture lines, facilities and land use right,
                  and Party
                  A shall assist Party B in such transfer.

              

      

       

      Service
        Fee and Payment

       

      The
        Parties agree that the fees for the Services provided by Party A under this
        Agreement shall be comprised of amounts as set forth in Exhibit 4 attached
        herein, and no other fees shall be charged.

       

      Intellectual
        Property Rights and Confidentiality Clauses

       

      
        	 	
                .1

              	
                Party
                  B shall have exclusive and proprietary rights and interests in
                  all rights,
                  ownership, interests and intellectual properties arising out of
                  or created
                  during the process of Service supply, including but not limited
                  to
                  copyrights, patents, patent applications, software, technical secrets,
                  trade secrets and others.

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      
        	 	
                .2

              	
                The
                  Parties acknowledge that the existence of this Agreement, technical
                  materials provided by Party B and any oral or written information
                  exchanged between the Parties in connection with the preparation
                  and
                  performance this Agreement are regarded as confidential information.
                  Each
                  Party shall maintain confidentiality of all such confidential information,
                  and without obtaining the written consent of the other Party, it
                  shall not
                  disclose any relevant confidential information to any third parties,
                  except for the information that: (a) is or will be in the public
                  domain
                  (other than through the receiving Party’s unauthorized disclosure); (b) is
                  under the obligation to be disclosed pursuant to the applicable
                  laws or
                  regulations, rules of any stock exchange, or orders of the court
                  or other
                  government authorities; or (c) is required to be disclosed by any
                  Party to
                  its shareholders, investors, legal counsels or financial advisors
                  regarding the transaction contemplated hereunder, provided that
                  such
                  shareholders, investors, legal counsels or financial advisors shall
                  be
                  bound by the confidentiality obligations similar to those set forth
                  in
                  this Section. Disclosure of any confidential information by the
                  staff
                  members or agencies hired by any Party shall be deemed disclosure
                  of such
                  confidential information by such Party, which Party shall be held
                  liable
                  for breach of this Agreement. This Section shall survive the termination
                  of this Agreement for any reason.

              

      

       

      
        	 	
                .3

              	
                The
                  Parties agree that this Section shall survive changes to, and rescission
                  or termination of, this Agreement.

              

      

       

      Representations
        and Warranties

       

      
        	 	
                .1

              	
                Party
                  A hereby represents and warrants as
                  follows:

              

      

       

      
        	 	
                .1.1

              	
                Party
                  A is a company legally registered and validly existing in accordance
                  with
                  the laws of China.

              

      

       

      
        	 	
                .1.2

              	
                Party
                  A's execution and performance of this Agreement is within its corporate
                  capacity and the scope of its business operations; Party A has
                  taken
                  necessary corporate actions and given appropriate authorization
                  and has
                  obtained the consent and approval from third parties and government
                  agencies, and will not violate any restrictions in law or otherwise
                  binding or having an impact on Party
                  A.

              

      

       

      
        	 	
                .1.3

              	
                This
                  Agreement constitutes Party A's legal, valid and binding obligations,
                  enforceable in accordance with its
                  terms.

              

      

       

      
        	 	
                .2

              	
                Party
                  B hereby represents and warrants as follows:

              

      

       

      
        	 	
                .2.1

              	
                Party
                  B is a company legally registered and validly existing in accordance
                  with
                  the laws of China and has obtained approval from relevant Chinese
                  governing departments for engaging in its
                  service.

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      
        	 	
                .2.2

              	
                Party
                  B's execution and performance of this Agreement is within its corporate
                  capacity and the scope of its business operations; Party B has
                  taken
                  necessary corporate actions and given appropriate authorization
                  and has
                  obtained the consent and approval from third parties and government
                  agencies, and will not violate any restrictions in law or otherwise
                  binding or having an impact on Party
                  B.

              

      

       

      
        	 	
                .2.3

              	
                This
                  Agreement constitutes Party B's legal, valid and binding obligations,
                  and
                  shall be enforceable against it.

              

      

       

      Effectiveness
        and Term

       

      
        	 	
                .1

              	
                This
                  Agreement is executed on the date first above written and shall
                  take
                  effect as of such date. Unless earlier terminated in accordance
                  with the
                  provisions of this Agreement or relevant agreements separately
                  executed
                  between the Parties, the term of this Agreement shall be 5 years.
                  After
                  execution of this Agreement, both Parties shall review this Agreement
                  in
                  accordance with this Section every 3 months to determine whether
                  to amend
                  or supplement the provisions in this Agreement based on the actual
                  circumstances at that time.

              

      

       

      
        	 	
                .2

              	
                The
                  term of this Agreement may be extended if confirmed in writing
                  by the
                  Parties prior to the expiration thereof. The extended term shall
                  be
                  determined by the Parties through
                  negotiation.

              

      

       

      Termination

       

      
        	 	
                .1

              	
                Unless
                  renewed in accordance with the relevant terms of this Agreement,
                  this
                  Agreement shall be terminated upon the date of expiration
                  hereof.

              

      

       

      
        	 	
                .2

              	
                During
                  the term of this Agreement, unless Party B commits gross negligence,
                  or a
                  fraudulent act, against Party A, Party A shall not terminate this
                  Agreement prior to its expiration
                  date.

              

      

       

      
        	 	
                .3

              	
                If
                  Party B has built or purchased from Party A the manufacture facilities,
                  lines and equipment or no longer needs Service from Party A due
                  to any
                  other reason, Party B can terminate this Agreement by prior written
                  notification to Party, but all issued orders shall still be completed
                  and
                  respective fees shall be paid as
                  well.

              

      

       

      
        	 	
                .4

              	
                The
                  rights and obligations of the Parties under Sections of confidentiality
                  and dispute resolution shall survive the termination of this
                  Agreement.

              

      

       

      Governing
        Law and Resolution of Disputes

       

      
        	 	
                .1

              	
                The
                  execution, effectiveness, construction, performance, amendment
                  and
                  termination of this Agreement and the resolution of disputes hereunder
                  shall be governed by the laws of China.

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      
        	 	
                .2

              	
                In
                  the event of any dispute with respect to the construction and performance
                  of this Agreement, the Parties shall first resolve the dispute
                  through
                  friendly negotiations. In the event the Parties fail to reach an
                  agreement
                  on the dispute within 30 days after either Party's request to the
                  other
                  Parties for resolution of the dispute through negotiations, either
                  Party
                  may submit the relevant dispute to the China International Economic
                  and
                  Trade Arbitration Commission for arbitration, in accordance with
                  its
                  Arbitration Rules. The arbitration shall be conducted in Beijing,
                  and the
                  language used in arbitration shall be Chinese. The arbitration
                  award shall
                  be final and binding on all
                  Parties.

              

      

       

      
        	 	
                .3

              	
                Upon
                  the occurrence of any disputes arising from the construction and
                  performance of this Agreement or during the pending arbitration
                  of any
                  dispute, except for the matters under dispute, the Parties to this
                  Agreement shall continue to exercise their respective rights under
                  this
                  Agreement and perform their respective obligations under this
                  Agreement.

              

      

       

      Notices

       

      
        	 	
                .1

              	
                All
                  notices and other communications required or permitted to be given
                  pursuant to this Agreement shall be delivered personally or sent
                  by
                  registered mail, postage prepaid, by a commercial courier service
                  or by
                  facsimile transmission to the address of such Party set forth below.
                  A
                  confirmation copy of each notice shall also be sent by email. The
                  dates on
                  which notices shall be deemed to have been effectively given shall
                  be
                  determined as follows:

              

      

       

      
        	 	
                .1.1

              	
                Notices
                  given by personal delivery, by courier service or by registered
                  mail,
                  postage prepaid, shall be deemed effectively given on the date
                  of delivery
                  or refusal at the address specified for
                  notices

              

      

       

      
        	 	
                .1.2

              	
                Notices
                  given by facsimile transmission shall be deemed effectively given
                  on the
                  date of successful transmission (as evidenced by an automatically
                  generated confirmation of
                  transmission).

              

      

       

      
        	 	
                .2

              	
                For
                  the purpose of notices, the addresses of the Parties are as
                  follows:

              

      

       

      
        	
                Party
                  A: 

              	
                 Inner
                  Mongolia Yongye Biotechnology Co. Ltd.

              
	
                Address:
                  

              	
                Yongye
                  Industrial Park, Jinshan Road, Jinshan

              
	 	
                Development
                  District, Huhehaote City

              
	
                Attn:
                  

              	
                Yin
                  Aihui

              
	
                Phone:
                  

              	
                86-0471-3395782

              
	
                Facsimile:
                  

              	
                86-0471-3395789

                 

              
	
                Party
                  B: 

              	
                Inner
                  Mongolia Yongye Nongfeng Biotechnology Co. 

              
	 	
                Ltd.

              
	
                Address:

              	
                Yongye
                  Industrial Park, Jinshan Road, Jinshan

              
	 	
                Development
                  District, Huhehaote City

              
	
                Attn:

              	
                Wu
                  Zishen

              
	
                Phone:

              	
                86-0471-3395767

              
	
                Facsimile:
                  

              	
                86-0471-3395765

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      
        	 	
                .3

              	
                Any
                  Party may at any time change its address for notices by a notice
                  delivered
                  to the other Party in accordance with the terms
                  hereof.

              

      

       

      Assignment

       

      
        	 	
                .1

              	
                Without
                  Party B's prior written consent, Party A shall not assign its rights
                  and
                  obligations under this Agreement to any third
                  party.

              

      

       

      
        	 	
                .2

              	
                Party
                  A agrees that Party B may assign its obligations and rights under
                  this
                  Agreement to any third party upon a prior written notice to Party
                  A but
                  without the consent of Party A.

              

      

       

      Severability

       

      In
        the
        event that one or several of the provisions of this Agreement are found to
        be
        invalid, illegal or unenforceable in any aspect in accordance with any laws
        or
        regulations, the validity, legality or enforceability of the remaining
        provisions of this Agreement shall not be affected or compromised in any
        aspect.
        The Parties shall strive in good faith to replace such invalid, illegal or
        unenforceable provisions with effective provisions that accomplish to the
        greatest extent permitted by law and the intentions of the Parties, and the
        economic effect of such effective provisions shall be as close as possible
        to
        the economic effect of those invalid, illegal or unenforceable
        provisions.

       

      Amendments
        and Supplements

       

      Any
        amendments and supplements to this Agreement shall be in writing. The amendment
        agreements and supplementary agreements that have been signed by the Parties
        and
        that relate to this Agreement shall be an integral part of this Agreement
        and
        shall have the same legal validity as this Agreement.

       

      [Signature
        Pages Follow]

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      IN
        WITNESS WHEREOF, the Parties have caused their authorized representatives
        to
        execute this Cooperation Agreement as of the date first above
        written.

       

      

       

      
        	
                Party
                  A: 

              	
                Inner
                  Mongolia Yongye Biotechnology Co. Ltd.

                 

              
	
                By:

              	
                Sealed
                  by Inner Mongolia Yongye Biotechnology Co. Ltd.

                 

                 

              
	 	 
	
                Party
                  B:

              	
                Inner
                  Mongolia Yongye Nongfeng Biotechnology Co. Ltd.

                 

              
	
                By:

              	
                Sealed
                  by Inner Mongolia Yongye Nongfeng Biotechnology Co.
                  Ltd.

              

      

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      

       

      

       

      Exhibit
        1 List of Intellectual Property Rights

       

      
        	
                Class

              	
                Name

              	
                Application
                  Number

              	
                Applying
                  Date

              	
                Remark

              
	
                Patent

              	
                One
                  nutrient for animals and its processing methods

              	
                200510118240.2

              	
                November
                  11, 2005

              	 
	
                Patent

              	
                One
                  nutrient for plants and its processing methods

              	
                2006101319537

              	
                July
                  6, 2007

              	 
	
                Trademark

              	
                Registration
                  Certificate
                  for “Yongye” trade mark, type I

              	
                4128935

              	
                October
                  7, 2007

              	 
	
                Technique

              	
                The
                  processings of ”ShengMingSu” for plants and animals

              	 	 	
                refer
                  to the following charts

              

      

      

      

    

      

      
      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
      

      

      
      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      Exhibit
        2 Product Standard 

       

      ShengMingSu
        for Plants

      

      Standards
        for the examination of product

      
        	
                1.

              	
                Appearance:
                  brown liquid

              

      

      
        	
                2.

              	
                ShengMingSu
                  should conform the requirements in Form
                  1

              

      

      

      Form
        1

      
        	
                Item

              	
                Index

              
	
                Content
                  of water-soluble humic acid, g/L                                     ≥

                Content
                  of total nutrient øN+P2O5+K2O÷,g/L                                  ≥

                Total
                  primary amount (calculated by element) of microelement (Fe,Mn,CCU,Mo,B,Zn
                  and so on), , g/L ≥ 

                Insoluable
                  matter, g/L                                    
           ≤

                pH(diluted
                  at 1:250)

              	
                50

                200

                 

                10

                50

                4-9

              
	
                 

                Harmful
                  element

              	
                As
                  øcalculated
                  by element÷,
                  mg/kg ≤

                Pb
                  øcalculated
                  by element÷,
                  mg/kg ≤

                Cd
                  øcalculated
                  by element÷,
                  mg/kg ≤

              	
                10

                50

                10

              

      

      Note:
        

      
        	
                1.

              	
                The
                  single element content of the mass nutrient should be no less than
                  40g/L

              

      

      
        	
                2.

              	
                .At
                  least 2 kinds of microelement should be included in the product.
                  Except
                  Mo, the single nutrient content of the other 5 microelements should
                  be no
                  less than 0.1%.

              

      

      

      

      

      ShengMingSu
        for Animal

      

      Standard
        for the examination of products

      
        	
                1.

              	
                Appearance:
                  grey particle and powder 

              

      

      
        	
                2.

              	
                ShengMingSu
                  should conform the requirements in Form 2

              

      

      

      Form
        2

      
        	
                Item

              	
                First
                  class

              	
                Second
                  class 

              	
                Third
                  class

              
	
                The
                  content of Humic acid (calculate by butt) ,% ≥

                 

                Moisture
                  content ,% ≤

                 

                Granularity
                  (CTR of the sieve of 2.00mm Standard),% ≥ 

                 

                Water-insoluble
                  (calculate by butt) , % ≤

                 

                pH
                  ≤

                 

                Heavy
                  metal (calculate by lead) mg/Kg ≤

                 

                Arsenic
                  mg/Kg ≤

                Fluorin
                  mg/Kg ≤ 

              	
                60

              	
                50

              	
                40

              
	
                 

                10

              	
                 

                10

              	
                 

                13

              
	
                 

                95

              
	
                 

                5

              	
                 

                10

              	
                 

                20

              
	
                 

                7

              	
                 

                7

              	
                 

                7

              
	
                 

                30

              	
                 

                30

              	
                 

                30

              
	
                 

                10

              	
                 

                10

              	
                 

                10

              
	
                80

              	
                80

              	
                80

              

      

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      
      

       

      Exhibit
        3 Form of Order

       

      
        	
                Manufacture
                  Order

              
	
                Client

              	
                Tel.

              	
                Address

              
	
                 

              	
                 

              	
                 

              
	
                Producer

              	
                Tel.

              	
                Address

              
	
                 

              	
                 

              	
                 

              
	
                Name
                  of Product

              	
                Quantity

              	
                Delivery
                  Date

              	
                Mode
                  of Payment

              	
                Method
                  of Delivery

              	
                Remark

              
	
                 

              	
                 

              	
                 

              	
                 

              	
                 

              	
                 

              
	
                 

              	
                 

              	
                 

              	
                 

              	
                 

              
	
                 

              	
                 

              	
                 

              	
                 

              	
                 

              
	
                 

              	
                 

              	
                 

              	
                 

              	
                 

              
	
                Total:

              
	
                Business
                  Contact:

              	
                Confirmation
                  of Logistics

              
	
                General
                  Manager (seal):

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      Exhibit
        4 Breakdown of Fees

       

      

       

      
        	 	
                Cost
                  Price of ShengMingSu for Plants: 350元/件

              	
                Cost
                  Price of ShengMingSu for Animals: 120元/件

              
	
                Raw
                  material and supplemental material fee

              	
                RMB
                  210 per piece

              	
                RMB
                  90 per piece

              
	
                Manufacturing,
                  overhead fee

              	
                RMB
                  105 per piece

              	
                RMB
                  18 per piece

              
	
                Non-predictable
                  fee

              	
                RMB
                  35 per piece

              	
                RMB
                  12 per piece

              
	
                2008-2009
                  Fees
                  in connection with Party A’s facilities & workplaces occupied by Party
                  B: RMB 2 per M2
                  per day, no fee charged for equipment
                  useSino-Foreign
      Cooperative Joint
      Venture Contract

    

     

    

    

    

    November
      16, 2007

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    TABLE
      OF CONTENTS

    

      
        	
                ARTICLE
                  I GENERAL PROVISIONS

              	
                3

              
	
                 

              	
                 

              
	
                ARTICLE
                  II PARTIES TO THE CONTRACT

              	
                3

              
	
                 

              	
                 

              
	
                ARTICLE
                  III ESTABLISHMENT OF THE COOPERATIVE JOINT VENTURE
                  COMPANY

              	
                3

              
	
                 

              	
                 

              
	
                ARTICLE
                  IV THE PURPOSE, SCOPE AND SCALE OF OPERATION

              	
                4

              
	
                 

              	
                 

              
	
                ARTICLE
                  V CONDITIONS OF COOPERATION AND COMPOSING

              	
                4

              
	
                 

              	
                 

              
	
                ARTICLE
                  VI RESPONSIBILITIES OF THE PARTIES

              	
                4

              
	
                 

              	
                 

              
	
                ARTICLE
                  VII OBLIGATIONS OF THE COMPANY BETWEEN SIGNING AND
                  CLOSING

              	
                5

              
	
                 

              	
                 

              
	
                ARTICLE
                  VIII OPERATION AND MANAGEMENT STRUCTURE

              	
                6

              
	
                 

              	
                 

              
	
                ARTICLE
                  IX LABOR MANAGEMENT

              	
                7

              
	
                 

              	
                 

              
	
                ARTICLE
                  X SALES

              	
                7

              
	
                 

              	
                 

              
	
                ARTICLE
                  XI FINANCIAL AFFAIRS, ACCOUNTING AND AUDITING

              	
                8

              
	
                 

              	
                 

              
	
                ARTICLE
                  XII TAX, PROFIT AND LOSE

              	
                8

              
	
                 

              	
                 

              
	
                ARTICLE
                  XIII TERM, TERMINATION AND LIQUIDATION

              	
                8

              
	
                 

              	
                 

              
	
                ARTICLE
                  XIIII MISCELLANEOUS

              	
                9

              

      

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    Article
      I General Provisions

    

    
      	1.	
              In
                accordance with the Law of the People’s Republic of China on Sino-Foreign
                Cooperative Joint Ventures and other relevant Chinese laws and
                regulations, Inner Mongolia Yongye Biotechnology Co. Ltd. (“Party A”) and
                Asia Standard Oil Limited (“Party B”) entered into this contract based on
                equality and mutual benefit in the status of legal
                person.

            

    

    

    Article
      II Parties to The Contract

    

    
      	
              2.

            	
              The
                Parties

            

    

    

    Party
      A:
      Inner Mongolia Yongye Biological Technique Co. Ltd.

    Registered
      Country: China

    Lagal
      Address: Yongye Industrial Park, Jinshan Road, Jinshan Development District,
      Huhehaote City

    

    Party
      B:
      Asia Standard Oil Limited

    Registered
      District: Hong Kong

    Legal
      Address: Floor 18, Two Chinachem Plaza, 68 Connaught Road Central,
      HK

    

    Article
      III Establishment of the Cooperative Joint Venture Company

    

    
      	
              3.

            	
              In
                consideration of mutual benefit, both parties hereby agree to cooperate
                and establish a Sino-foreign cooperative joint venture company (the
                “Company”) in Yongye Industrial Park, Jinshan Road, Jinshan Development
                District, Huhehaote City of China. The name of the company shall
                be
                “内筧古永业农丰生物科技有榰狝任公司”
                in Chinese, and “Inner Mongolia Yongye Biological Technique Co. Ltd.” in
                English.

            

    

    

    
      	
              4.

            	
              The
                Company is established in accordance to with the Law of the People’s
                Republic of China on Sino-Foreign Cooperative Joint Ventures and
                other
                relevant Chinese laws and regulations by two legal
                persons.

            

    

    

    
      	
              5.

            	
              All
                economic and business activities of the Company shall comply with
                and be
                protected by laws, decrees, rules and relevant regulations of
                China.

            

    

    

    
      	
              6.

            	
              Both
                parties take responsibility of the debts, risks and lost of the company
                and share its profit.

            

    

    

    Article
      VI The Purpose, Scope and Scale of Operation

    

    
      	
              7.

            	
              The
                Purpose of Operation: the purpose of operation is to develop domestic
                economics of China and obtain legal profit. The tenet is to develop
                the
                promotion and sales of 愼纰植溈系列产品,
                to meet the rising need of the domestic and foreign markets and to
                obtain
                economic benefits.

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
      	
              8.

            	
              The
                Scope of Operation: promotion and sales of 愼纰植溈系列产品;
                promotion and sales of 动物生命素and
                植物生命素。

            

    

    

    
      	
              9.

            	
              The
                Scale of Operation: 10,000 tons of植物生命素,
                4,000 tons of 动物生命素
                and other products.

            

    

    

    Article
      V Conditions of Cooperation and Composing

    

    
      	
              10.

            	
              The
                condition of cooperation is comprised of technique, trademark and
                patent
                from Party A and cash from Party B.

            

    

    

    
      	
              11.

            	
              The
                total investment is US$ 1,450,000 and the registered capital is US$
                1,000,000. Party A shall contribute in the form of technique, trademark
                and patent totaling US$ 100,000 and Party B contributed US$ 900,000
                in
                cash. 

            

    

    

    
      	
              12.

            	
              After
                approval of establishment of Company, Party A shall open a RMB account
                and
                a foreign exchange account at the local
                bank.

            

    

    

    
      	
              13.

            	
              After
                receipt of account-open certificate, Party B shall deposit US$ 900,000
                into an account opened by Party by installments pursuant to relevant
                laws
                and regulations. If Party B  breaches this contract, it shall
                take responsibility for the economical loss arising from this
                breach. 

            

    

    

    
      	
              14.

            	
              Party
                A shall perform the commitment of capital contribution in the form
                of
                technique, trademark and patent according to the agreement. If Party
                A
                breaches this contract, it shall take responsibility for
                the economical loss arising out of this breach.
                

            

    

    

    Article
      VI Responsibilities of the Parties

    

    
      	
              15.

            	
              Responsibilities
                of Party A

            

    

    

    
      	 	
              15.1

            	
              Applying
                with Chinese governments for approval of establishment of Company
                and for
                registration with relevant administration for industry and commerce.
                

            

    

    

    
      	
            	15.2	
              Handling
                relevant procedures in connection with the Company with relevant
                governmental authorities.

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
            	15.3	
              Arranging
                housing and public facility requirements of the Company based on
                real
                circumstances. 

            

    

    

    
      	
            	15.4	
              Handling
                the employment procedures and recommending management technicians who
                will be employed by the Board of Directors according to the need
                if
                passing examinations.

            

    

    

    
      	
            	15.5	
              Handling
                invitation and housing procedures of the Company’s foreign members and
                arranging their work, traffic and life.

            

    

    

    
      	
            	15.6	
              Other
                responsibility of Party A agreed by both parties.
                

            

    

    

    
      	
              16.

            	
              Responsibilities
                of Party B

            

    

    

    
      	 	
              16.1

            	
              Providing
                request of office building. 

            

    

    

    
      	 	
              16.2

            	
              Providing
                trade materials required by the
                Company.

            

    

    

    
      	 	
              16.3

            	
              Providing
                technical guidance on imported (ASO will import products or export
                products) product standard and operation rules.
                

            

    

    

    
      	 	
              16.4

            	
              Providing
                foreign technique information and market information regarding product
                of
                the Company. 

            

    

    

    
      	 	
              16.5

            	
              Providing
                the employees with sales technical
                training.

            

    

    

    
      	 	
              16.6

            	
              Improving
                the product’s competition ability in the international market, enlarging
                the domestic and foreign markets, ensure the Company’s foreign currency
                balance and gain higher economical benefit.

            

    

    

    
      	 	
              16.7

            	
              Other
                responsibility of Party B agreed by both
                parties.

            

    

    

    
      	
              17.

            	
              Any
                Party failing to perform its obligations and therefore causing loss
                to the
                Company shall be responsible for such loss.

            

    

    

    Article
      VII The Formation of the Board of Directors

    

    
      	
              18.

            	
              The
                Company is a cooperative joint venture in the form of legal person.
                The
                Board shall be the highest authority of the
                Company.

            

    

    

    
      	
              19.

            	
              The
                Board shall consist of three (3) directors, two (2) of whom shall
                be
                appointed by Party A and one (1) of whom shall be appointed by Party
                B.
                The Board has one (1) Chairman, one (1) Vice-chairman, one (1) director
                and one (1) supervisor, all with a term of three (3) years. The Chairmen
                shall be appointed by Party A and can serve consecutive terms. The
                supervisor shall be selected by the
                Board.

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	
              20.

            	
              The
                Chairmen is legal representative of the Company. In the event that
                the
                Chairmen can not perform his responsibility, the Vice-Chairmen or
                other
                directors shall be authorized to represent the Company.
                

            

    

    

    
      	
              21.

            	
              Meetings
                of the board of directors are convened at least once a year usually
                at
                local place at the end of December, or other place if necessary.
                The
                Chairmen can also convene an interim meeting after procuring consent
                from
                the Vice-Chairmen. The meeting shall be presided by the Chairmen.
                In the
                event that the Chairmen can not convene a meeting, the Vice-Chairmen
                or
                other directors can be authorized to preside the meeting. Notice
                of date,
                place and topic of each meeting shall be given to all directors three
                weeks before the meeting.

            

    

    

    
      	
              22.

            	
              The
                directors shall attend the meetings of the board of directors in
                person. If a director is unable to attend a meeting for any reason,
                he may
                appoint a representative to attend, speak and vote. One representative
                can
                not represent two or more directors (the meeting of the Board can
                only be
                held with more than 2/3 directors including representatives of directors
                attending.)

            

    

    

    
      	
              23.

            	
              The
                Board shall research and discuss problems on base of equality, mutual
                benefit and friendly negotiation.

            

    

    

    Resolutions
      involving the following matters shall be adopted upon the unanimous affirmative
      vote of each director of the Board attending the meeting: 

    

    
      	 	
              (1)

            	
              an
                amendment to contracts and Articles of Association of the
                Company

            

    

    
      	 	
              (2)

            	
              the
                shutting down or dissolution of the
                Company

            

    

    
      	 	
              (3)

            	
              the
                increasing or assignment of the Company’s registered
                capital

            

    

    
      	 	
              (4)

            	
              the
                merger of the Company with another
                organization

            

    

    

    Other
      matters can be resolved according to the rules in Articles of the Association
      of
      the Company. Resolution of the Board shall be written in Chinese and in four
      counterparts. After execution by the Chairmen, one counterpart shall be held
      by
      the Company, one shall be held by Party B and two shall be held by Party
      A.

    

    
      	
              24.

            	
              A
                General Manager can be employed by the Board with fixed term. The
                General
                Manager shall enforce the resolution of the Board, take charge of
                the
                management of the Company and periodically report to the
                Board.

            

    

    

    Article
      VIII Operation and Management Structure

    

    
      	
              25.

            	
              The
                Company has operation and management structure, responsible for daily
                management. The operation and management structure is comprised of
                one (1)
                General Manager and other senior managers employed by the Board with
                a
                term of three (3) years. 

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	
              26.

            	
              Responsibilities
                and Powers of the General Manager:

            

    

    

    
      	 	
              (1)

            	
              Enforcing
                contracts made by the Parties, articles of association and resolutions
                of
                the Board.

            

    

    
      	 	
              (2)

            	
              Nominating
                directors of each department, examining and approving employees and
                reporting to the Board for recordation.

            

    

    
      	 	
              (3)

            	
              Making
                operation and management systems of the Company, disposing, directing,
                supervising and examining each functional departments.
                

            

    

    
      	 	
              (4)

            	
              Periodically
                submitting work report, financial report and profit dividend method
                to the
                Board.

            

    

    
      	 	
              (5)

            	
              Making
                decisions to product sales, specific cooperation contract and debt
                and
                credit of flowing fund.

            

    

    
      	 	
              (6)

            	
              Examining
                and approving the price of product for distribution over domestic
                and
                foreign markets enacted by functional departments and determining
                appropriate adjustment of the
                price.

            

    

    
      	 	
              (7)

            	
              Receiving
                important clients from partners, negotiating and signing documents.
                

            

    

    
      	 	
              (8)

            	
              Presiding
                administrative meetings of the Company and executing the issues discussed
                in that meetings and the resolutions.

            

    

    
      	 	
              (9)

            	
              Resolving
                other problems raised by each functional department.
                

            

    

    
      	 	
              (10)

            	
              Representing
                the Company or assigning representatives to attend meetings regarding
                the
                approval or arbitration, mediation in accordance with the authorization
                of
                the Board.

            

    

    
      	 	
              (11)

            	
              Making
                final administrative decision to the punishment of the employee offending
                regulations. 

            

    

    
      	 	
              (12)

            	
              Other
                issues taken in charge of the General
                Manager.

            

    

    

    Article
      IX Labor Management

    

    
      	
              27.

            	
              Unless
                regulated by the Regulation on Foreign Invested Enterprise’s Labor
                Administrationôemployment,
                dismissal, pay, labor discipline and labor benefit shall be practiced
                according to the resolution of the Board.

            

    

    

    
      	
              28.

            	
              Employees
                of the Company are entitled to establish labor union according to
                the
                Chinese Labor Union Law and Articles of Chinese Labor Union and organize
                relevant labor union activities. The Company shall actively support
                the
                work of the labor union.

            

    

    

    Article
      X Sales

    

    
      	
              29.

            	
              The
                Company shall make the next year’s production and sales plan on the
                meeting of the Board convened every year. The Plan can be appropriately
                adjusted according to the domestic and foreign markets provided that
                the
                economical benefit and foreign currency balance can be guaranteed.
                

            

    

    

    
      	
              30.

            	
              After
                passing examination of General Administration of Quality Supervision,
                Inspection and Quarantine of the People's Republic of China or its
                local
                agency, 动、植物生命素系列产品sold
                by the Company can be directly exported by the Company according
                to the
                annual export plan, and also can be sold as exported product on Canton
                Fair. 

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	
              31.

            	
              The
                Company agrees in principle that all products meeting the standard
                of
                export shall be exported to insure the foreign currency balance and
                earn
                foreign exchange. 

            

    

    

    
      	
              32.

            	
              Party
                B shall take charge of the foreign sales of the Company in the name
                of the
                Company.

            

    

    

    
      	
              33.

            	
              The
                sales price and quantity of the exported product shall be connected
                with
                the foreign currency balance and cost calculation and shall be adjusted
                from time to time with reference to the change of the international
                market. 

            

    

    

    
      	
              34.

            	
              Products
                to be sold in domestic markets shall be executed according to the
                Chinese
                price policy. Particular price shall be determined by the President
                and be
                reported to governing departments and price departments for registration.
                Prices of products to be sold in foreign markets shall be determined
                by
                the President according to the international market price or the
                transaction price of the Canton
                Fair.

            

    

     

    Article
      XI Financial Affairs, accounting and Auditing

    

    
      	
              35.

            	
              Accounting
                system of the Company shall be practiced according to relevant regulations
                of financial departments of China and any accounting system passed
                by the
                Board shall reflect the particular situation of the
                Company.

            

    

    

    
      	
              36.

            	
              All
                kinds of financial statements of the Company shall be reported to
                the
                parties by the tenth day of next month. The annual financial statement
                shall be submitted by the end of next month and examined by a certified
                public accountant in China appointed by the Company. All financial
                statements shall be recorded with governing department, statistic
                department and relevant departments.

            

    

    

    
      	
              37.

            	
              The
                Company shall adopt credit and debit accounting principles, and all
                books
                shall be written in Chinese. RMB shall be adopted as Company’s bookkeeping
                currency. Other currency belonging to the cooperative investment
                shall be
                converted according to the foreign currency quote price of Bank of
                China.
                Currency belonging to trading shall be settled according to the foreign
                exchange price for trade. Foreign exchange shall be settled according
                to
                the Regulations of the People's Republic of China on the Management
                of
                Foreign Exchanges.

            

    

    

    
      	
              38.

            	
              Financial
                Auditing of the Company shall be checked and conducted by a certified
                public account licensed to practice in China. Auditing results shall
                be
                reported to the Board and
                President.

            

    

    

    
      	
              39.

            	
              The
                Company shall open a foreign account in place appointed by Subsidiary
                of
                Bank of China in Inner Mongolia

            

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    Article
      XII Tax, Profit and Lost

    

    
      	
              40.

            	
              The
                Company shall pay taxes according to articles of the Chinese Tax
                Law.
                

            

    

    

    
      	
              41.

            	
              Proportion
                of the withholding of the reserve fund, development fund, employee
                bonus
                and welfare fund of the after-tax profit shall be determined by the
                Board.
                

            

    

    

    
      	
              42.

            	
              All
                profits, immediately after payment of enterprise income tax and
                reservation of various funds, shall be distributed to Party A and
                Party B
                since the profitable year as follows: Party A gains 10% and Party
                B gains
                90%.

            

    

    

    
      	
              43.

            	
              The
                Company shall distribute the profit once a year. The profit distribution
                plan and specfic amount shall be published in four months after end
                of
                each fiscal year. 

            

    

    

    
      	
              44.

            	
              Profit
                shall not be distributed unless and until the previous fiscal year’s
                losses have been made up. Undistributed profits of previous fiscal
                year
                can be consolidated into the distribution of current fiscal
                year.

            

    

    

    Article
      XIII Term, Termination and Liquidation

    

    
      	
              45.

            	
              The
                operation term of the Company shall be 10 years, commencing from
                issuance
                of the Business License.

            

    

    

    
      	
              46.

            	
              If
                the Parties agree to extend the term, the Board shall make a resolution.
                A
                written application shall be submitted to the Approval Authority
                for
                approval no less than six (6) months prior to the expiration of the
                term.
                The term can be extended with the approval and modification procedures
                shall be handled with the Approval
                Authority.

            

    

    

    
      	
              47.

            	
              If
                the Parties believe that the termination of the contract conforms
                to best
                interest of the Parties, they can terminate the contract in advance.
                In
                the event that the Company terminates the contract in advance, the
                termination shall be determined by the general meeting of the directors
                and reported to the original Approval Authority for approval.
                

            

    

    

    
      	
              48.

            	
              Any
                Party is entitled to terminate this contract in event of occurrence
                of
                following.

            

    

    

    
      	
              49.

            	
              If
                term expires or the contrat is terminated in advance, the Board of
                Directors shall submit the procedures, principles of liquidation
                and
                candidates of an liquidation committee so as to establish the liquidation
                committee to conduct liquidation over the Company’s
                assets.

            

    

    

    
      	
              50.

            	
              The
                duties of liquidation committee shall be conducting a thorough
                investigation agaisnt the Company’s assets, debts and credits, providing a
                balance sheet and list of Company assets and drafting a liquidation
                plan.
                The liquidation committee shall present the same to the Board of
                Directors
                for approval.

            

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	
              51.

            	
              During
                the period of liquidation, the liquidation committee shall represent
                the
                Company in initiating and responding to legal
                actions.

            

    

    

    
      	
              52.

            	
              The
                liquidation fee and the salary for the liquidation committee members
                shall
                be reserved from existing assets of the Company and shall enjoy priority
                in terms of payment.

            

    

    

    
      	
              53.

            	
              After
                the liquidation committee pay all outstanding debts of the Company,
                the
                remaining properties shall belong to Party
                A.

            

    

    

    
      	
              54.

            	
              After
                the liquidation is completed, the Company shall report to the Approval
                Authority and handle the cancellation registration with the original
                registration authority, returning the Business License as well as
                making a
                public annoucement.

            

    

    

    
      	
              55.

            	
              After
                the Company is terminated, all the account books shall be preserved
                by
                Party A.

            

    

    

    Article
      XIII Miscellaneous

    

    
      	
              56.

            	
              Amendment
                of this contract shall be approved by unanimous resolution of the
                Board
                and reported to Approval Authority for approval.
                

            

    

    

    
      	
              57.

            	
              This
                contract and its amendment shall not become effective unless and
                until
                approved by the Huhehaote Municipal Bureau of Commerce.
                

            

    

    

    
      
        	58.	
                This
                  contract will become effective after sealed (or signed) by the
                  Parties.
                  

              

      

    

    

    

    Party
      A

    Sealed
      by
      Inner Mongolia Yongye Biotechnology Co., Ltd.

    

    

    Party
      B

    Sealed
      by
      Asia Standard Oil Limited

    

    
      
        
        

      

      
        10

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00140-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00140-of-00352.parquet"}]]