Document:

f8k050609ex10i_mit.htm

     

     

    Exhibit
10.1

     

    JOINT
VENTURECONTRACT

     

    BETWEEN

     

    JIANGSU
HUALAN BIOTECHOLOGYLTD.(CHINA)

     

    AND

     

    MEDICAL
INTERNATIONAL TECHNOLOGIES(MIT CANADA)INC.

     

     

     

     

     

     

     

     

     

     

    (DATED
ON THE MAY 6th, 2009)

     

     

     

    
      
        
        

      

      
         

        
          

        

      

      
        
        

      

    

     

     

    
      TABLE
OF CONTENT

       

    

     

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              
                                                                                	
                                                                                        GENERAL

                                                                                      	 
      	 
      
	
                                                                                        ARTICLE
      1

                                                                                      	 
      	
                                                                                        DEFINITIONS

                                                                                      
	
                                                                                        ARTICLE
      2

                                                                                      	 
      	
                                                                                        PARTIESTO
      THE CONTRACT

                                                                                      
	
                                                                                        ARTICLE
      3

                                                                                      	 
      	
                                                                                        ESTABLISHMENTOF
      THE JOINT VENTURE COMPANY

                                                                                      
	
                                                                                        ARTICLE
      4

                                                                                      	 
      	
                                                                                        THE
      PURPOSE, SCOPE AND SCALE OF PRODUCTIONAND OPERATION

                                                                                      
	
                                                                                        ARTICLE
      5

                                                                                      	 
      	
                                                                                        TOTAL
      INVESTMENT, REGISTERED

                                                                                      
	
                                                                                        ARTICLE
      6

                                                                                      	 
      	
                                                                                        CAPITAL
      CONTRIBUTIONS

                                                                                      
	
                                                                                        ARTICLE
      7

                                                                                      	 
      	
                                                                                        BOARD
      OF DIRECTORS

                                                                                      
	
                                                                                        ARTICLE
      8

                                                                                      	 
      	
                                                                                        MANAGEMENT
      ORGANIZATION

                                                                                      
	
                                                                                        ARTICLE
      9

                                                                                      	 
      	
                                                                                        THE
      PARTIES' RESPONSIBILITIES OF ASSISTANCE

                                                                                      
	
                                                                                        ARTICLE
      10

                                                                                      	 
      	
                                                                                        TRANSFER
      OF TECHNOLOGY

                                                                                      
	
                                                                                        ARTICLE
      11

                                                                                      	 
      	
                                                                                        PURCHASE
      OF EQUIPMENTAND RAW MATERIALS

                                                                                      
	
                                                                                        ARTICLE
      12

                                                                                      	 
      	
                                                                                        UTILITIES,
      INFRASTRUCTUREAND SERVICES

                                                                                      
	
                                                                                        ARTICLE
      13

                                                                                      	 
      	
                                                                                        SALE
      OF PRODUCTS

                                                                                      
	
                                                                                        ARTICLE
      14

                                                                                      	 
      	
                                                                                        SITE
      LAND AND BUILDING

                                                                                      
	
                                                                                        ARTICLE
      15

                                                                                      	 
      	
                                                                                        HEALTH,
      S AFETY AND ENVIRONMENT PROTECTION

                                                                                      
	
                                                                                        ARTICLE
      16

                                                                                      	 
      	
                                                                                        TRADEMARKS
      AND TRADE NAMES

                                                                                      
	
                                                                                        ARTICLE
      17

                                                                                      	 
      	
                                                                                        FOREIGN
      EXCHANGE

                                                                                      
	
                                                                                        ARTICLE
      18

                                                                                      	 
      	
                                                                                        FINANCE,
      ACCOUNTING AND AUDITING

                                                                                      
	
                                                                                        ARTICLE
      19

                                                                                      	 
      	
                                                                                        DISTRIBUTIONAND
      PAYMENT OF PROFITS

                                                                                      
	
                                                                                        ARTICLE
      20

                                                                                      	 
      	
                                                                                        TAXATION

                                                                                      
	
                                                                                        ARTICLE
      21

                                                                                      	 
      	
                                                                                        INSURANCE

                                                                                      
	
                                                                                        ARTICLE
      22

                                                                                      	 
      	
                                                                                        LABOR
      MANAGEMENT

                                                                                      
	
                                                                                        ARTICLE
      23

                                                                                      	 
      	
                                                                                        CONFIDENTIALITY

                                                                                      
	
                                                                                        ARTICLE
      24

                                                                                      	 
      	
                                                                                        FUTURE
      COOPERATIONAND NON-COMPETITION

                                                                                      
	
                                                                                        ARTICLE
      25

                                                                                      	 
      	
                                                                                        THE
      JOINT VENTURE TERM

                                                                                      
	
                                                                                        ARTICLE
      26

                                                                                      	 
      	
                                                                                        ASSIGNMENTOF
      INVESTMENT

                                                                                      
	
                                                                                        ARTICLE
      27

                                                                                      	 
      	
                                                                                        TERMINATION
      AND LIQUIDATION

                                                                                      
	
                                                                                        ARTICLE
      28

                                                                                      	 
      	
                                                                                        BREACH
      OF CONTRACT

                                                                                      
	
                                                                                        ARTICLE
      29

                                                                                      	 
      	
                                                                                        FORCE
      MAJEURE

                                                                                      
	
                                                                                        ARTICLE
      30

                                                                                      	 
      	
                                                                                        APPLICABLE
      LAW

                                                                                      
	
                                                                                        ARTICLE
      31

                                                                                      	 
      	
                                                                                        SETTLEMENTOF
      DISPUTES

                                                                                      
	
                                                                                        ARTICLE
      32

                                                                                      	 
      	
                                                                                        LANGUAGE,
      EFFECTIVENESS OF CONTRACTAND MISCELLANEOUS
  PROVISIONS

                                                                                      

                                                                              

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

     

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    
      THIS
CONTRACT is signed at: NO.1 Medical City Road, suite # 228 Taizhou,
Jiangsu  China, on the May 6th
2009  by and between A Corporation, and B Corporation.

      

      GENERAL

      In
accordance with "The Company Law of the People's Republic of China ", "The Law
of the People's Republic of China on Joint Ventures Using Chinese and Foreign
Investment", "The Implementation Rules for the Law of the People's Republic of
China on Joint Ventures Using Chinese and Foreign Investment" and other relevant
laws and regulations of China, the Parties on the basis of the principle of
equality and mutual benefit, long-term cooperation, joint development and enhancing friendship,
and through friendly consultations, agree to jointly invest, to establish a
joint venture in the planned development area. The Parties will contribute
their respective resources and special knowledge and skills and jointly operate,
manage and develop the joint venture.

      

      Now,
therefore, the Parties have agreed as follows:

      

      
        	
                ARTICLE
      1

              	
                DEFINITIONS

              

      

      

      Unless
the terms or context of this Contract otherwise provides specifically, the
following terms shall have the meanings set out below:

      

      
        	
                1.01

              	
                "Articles
      of Association" shall mean the articles of association of the
      Company;

              

      

      

      
        	
                1.02

              	
                "Board
      of Directors" or "Board" shall mean the board of directors of the
      Company;

              

      

      

      
        	
                1.03

              	
                "China"
      or "State" shall mean the People's Republic of
  China;

              

      

      

      
        	
                1.04

              	
                "Company"
      shall mean the joint venture company to be formed pursuant to this
      Contract;

              

      

    

    
       

      
        
          
            	
                    1.05

                  	
                    "Contract"
      shall mean this Joint Venture
Contract;

                  

          

          

          
            	
                    1.06 
      

                  	
                    “Technology
      Transfer Contract” shall mean:  License to produce and sell. In
      china, Medical International Technologies (MIT Canada) Inc., NEEDLE-FREE
      JET INJECTOR products under the Patents and Trade marks, as per annex A
      attached.

                  

          

          

          
            	
                    1.07

                  	
                    "
      Plant(s)" shall mean: Manufacturing plant for the assembly and production
      of the NEEDLE-FREE JET INJECTOR
PRODUCTS.

                  

          

          

          
            
              	
                      1.08

                    	
                      "
      Products" shall mean: NEEDLE-FREE JET INJECTOR FAMILY OF PRODUCTS,
      AGRO-JET and MED-JET.

                    
	 	 
	1.09	
                       "Effective
      Date" shall mean the effective date of this Contract, which shall be the
      date on which all of the following conditions have been
      fulfilled:

                    

            

          

           

          
            	
                     
      

                  	
                    (1)

                  	
                    this
      Contract and the Articles of Association have been signed by each of the
      Parties and have been approved in their entirety by the
      Examination and Approval Authority;

                  

          

           

          
            	 	
                    (2) 

                  	
                    approval
      of all Technology Transfer Contracts and, if required, approval of all
      Engineering Services Contracts and the Contract for the Assignment of
      Experts,
      all in their entirety, have been obtained from the Examination and
      Approval Authority;

                  

          

          

          
            	
                    1.10

                  	
                    "Examination
      and Approval Authority" shall mean the Bureau of Foreign Trade and
      Economic Cooperation of China;

                  

          

           

          
            	
                    1.11

                  	
                    "Employees"
      shall mean all personnel who have a labour contract relationship with the
      Company except Senior Staff and Temporary Delegates and Short-Term
      Employees;

                  

          

           

          
            
              
              

            

            
              -3-

              
                

              

            

            
              
              

            

          

           

          
            	
                    1.12

                  	
                    "Joint
      Feasibility Study Report" shall mean the feasibility study report, jointly
      prepared and initialled by the Parties and supplementary reports thereto,
      for the purpose of evaluating the technical and commercial feasibility of
      building and operating plants;

                  

          

           

          
            	
                    1.13

                  	
                    "Party"
      or "Parties", separately or collectively, shall mean any party signed the
      JOINT VENTURE CONTRACT.

                  

          

          

          
            	
                    1.14

                  	
                    "Senior
      Staff" shall mean the Company's top managerial personnel nominated by the
      Parties in accordance with their nomination rights and appointed by the
      Board of Directors;

                  

          

           

          
            	
                    1.15

                  	
                    "Temporary
      Delegates" shall mean certain persons who are temporarily delegated to,
      and employed by, the Company.

                  

          

          

          
            	
                    ARTICLE 
      2

                  	
                    PARTIES
      TO THE CONTRACT

                  

          

          

          
            	
                    2.01

                  	
                    The
      Parties to this Contract are:

                  

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    Party
      A is JIANGSU HUALAN
      BIOTECHOLOGY LTD. (CHINA)

                  

          

          

          The
representative of A Corporation duly authorized to sign this Contract
is:

          

          Name:
Hua, Yimin

          Position:
General Manager

          Nationality:
China

          

          
            	
                     
      

                  	
                    (2)

                  	
                    Party
      B is MEDICAL
      INTERNATIONAL TECHNOLOGIES (MIT CANADA)
  INC.

                  

          

          The
representative of Party B duly authorized to sign this Contract is:

          

          Name:
KARIM MENASSA

          Position:  President,
CEO, AND CHAIMAN OF THE BOARD

          Nationality:
CANADIAN

          

          
            	
                    2.02

                  	
                    A
      copy of the business license of each Party has been provided to each of
      the other Parties.

                  

          

          

          
            	
                    2.03

                  	
                    Each
      of the Parties hereby represents and warrants
  that:

                  

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    it
      possesses full power and authority to enter into this Contract and to
      perform its obligations hereunder;

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    each
      of their representatives whose signature is affixed hereto has been fully
      authorised to sign this Contract ;
and

                  

          

          

          
            	
                     
      

                  	
                    (3)

                  	
                    upon
      the Effective Date, this Contract shall  constitute its legal,
      valid and binding obligations.

                  

          

          

          
            	
                    ARTICLE 
      3

                  	
                    ESTABLISHMENT
      OF THE JOINT VENTURE COMPANY

                  

          

          

          
            	
                    3.01

                  	
                    The
      Parties agree to establish the Company in accordance with "The Company Law
      of the People's Republic of China ", "The Law of the People's Republic of
      China on Joint Ventures Using Chinese and Foreign Investment", "The
      Implementation Rules for the Law of the People's Republic of China on
      Joint Ventures Using Chinese and Foreign Investment" and other relevant
      laws and regulations of China and the provisions of the Contract and the
      Articles of Association.

                  

          

          

          
            	
                    3.02

                  	
                    The
      name of the Company shall be: JIANGSU HUALAN MIT MEDICAL TECHNOLOGY (MIT
      China) LTD.

                  

          

           

          
            
              
              

            

            
              -4-

              
                

              

            

            
              
              

            

             

          

          
            	
                    3.03

                  	
                    The
      legal address of the Company shall be: NO.1
      Medical City Road, suite # 228 Taizhou,
      Jiangsu  China,

                  

          

          

          
            	
                    3.04

                  	
                    The
      organization form of the Company shall be: Limited Liability
      Company.

                  

          

          

          
            	
                    3.05

                  	
                    The
      Company shall be a legal person under the laws of China. The activities of
      the Company shall be governed and protected by the present and future
      published laws of China.

                  

          

          

          
            	
                    3.06

                  	
                    All
      the organization and business activities of the Company shall be conducted
      under the leadership of the Board of
Directors.

                  

          

          

          
            	
                    ARTICLE
      4 

                  	
                    THE  PURPOSE
      ,  SCOPE  AND  SCALE  OF  PRODUCTION  AND  OPERATION

                  

          

          

          
            
              	
                      4.01

                    	
                      Purpose:
      The purpose of the Company shall be to adopt most advanced technology
      including high standards to protect the environment and to minimize use of
      natural resources and energy consumption in integrated systems and to
      apply scientific management methods with the aim to build, operate plants,
      improve and expand the production and use of Products, as well as to earn
      lawful profits, pay dividends to the Parties, and to make contributions to
      the economic development of China, especially of Jiangsu
      Province.

                    

            

          

          

          
            	
                    4.02

                  	
                    Business
      Scope: research, production and sales of medical equipments, import and
      export of medical equipments and components
  products.

                  

          

          

          
            	
                    ARTICLE
      5

                  	
                    TOTAL
      INVESTMENT, REGISTERED CAPITAL

                  

          

          

          
            	
                    5.01

                  	
                    The
      total investment by the Company as defined in the approved Joint
      Feasibility Study Report shall amount to US$
  2,000,000.

                  

          

          

          
            	
                    5.02

                  	
                    The
      Company's registered capital shall amount to US$
  1,400,000.

                  

          

          

          
            	
                    5.03

                  	
                    The
      Parties shall contribute to the registered capital in the proportions and
      amounts as follows:

                  

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    A
      shall subscribe for US$714,000, amounting to FIFTY ONE percent (51%) of
      the registered capital;

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    B
      shall subscribe for US$686,000, amounting to FORTY NINE percent (49%) of
      the registered capital. (20% for the TECHNOLOGY VALUED TO US$280,000 and
      US$406,000 in cash for 29% ).

                  

          

          

          
            	
                    5.04

                  	
                    A
      shall contribute in USD. B shall contribute
      in USD and license to produce and sell. In china, Medical International
      Technologies (MIT Canada) Inc., NEEDLE-FREE JET INJECTOR products under
      the Patents and Trade marks, as per annex A
  attached.

                  

          

          

          
            	
                    5.05

                  	
                    The
      Company shall take all feasible measures to control the investment so as
      to avoid, to the greatest extent, the total investment as described in
      Article 5.01 being exceeded.

                  

          

          

          
            	
                    5.06

                  	
                    Any
      increase of the registered capital shall be subject to the unanimous
      consent of the Board of Directors and submitted to the Examination and
      Approval Authority for approval. Registration procedures for change shall
      be dealt with at the relevant registration and administration
      authority.

                  

          

          

          
            	
                    5.07

                  	
                    The
      exchange rate which will be used for determining the RMB equivalent of
      capital contributions in USD  shall be the official middle
      transaction rate of exchange of RMB to USD as published by the People's
      Bank of China pursuant to the floating exchange rate system or, if such
      official middle rate is not available, shall be the middle rate of
      exchange of RMB to USD as published by the Bank of China, and all in
      effect on a date which is four(4) working days before such contributions
      are made.

                  

          

          

          
            
              
              

            

            
              -5-

              
                

              

            

            
              
              

            

             

          

          
            	
                    5.08  

                  	
                    Provided
      that the Company's normal operation is not affected, the registered
      capital of the Company may be reduced subject to the fulfilment of all the
      conditions as stipulated in the relevant laws and
    regulations.

                  

          

          

          
            	
                     
      

                  	
                    Any
      reduction of the registered capital shall be subject to the unanimous
      consent of the Board of Directors and submitted to the Examination and
      Approval Authority for approval. Registration procedures for change shall
      be dealt with at the relevant registration and administration
      authority.

                  

          

          

          
            	
                    ARTICLE 
      6

                  	
                    CAPITAL
      CONTRIBUTIONS

                  

          

          

          
            	
                    6.01

                  	
                    The
      Parties shall contribute simultaneously their subscribed capital to the
      registered capital of the Company according to Article
    5.03.

                  

          

          

          
            	
                     
      

                  	
                     Further
      details shall be agreed upon in a relevant
  agreement.

                  

          

          

          
            	
                    6.02

                  	
                    Within
      ninety (90) days of the granting of a business license to the Company the
      Parties shall pay the total amount of the registered capital, amounting to
      US$1,400,000..

                  

          

          

          
            	
                    6.03

                  	
                    Contributions
      referred to in Article 6.02 shall be made by the Parties regardless of the
      actual progress of the projects. Further payments to the registered
      capital shall be made by the Parties according to the financial needs of
      the Company in accordance with the actual progress of the projects. The
      registered capital shall be fully contributed within six (6) Month after
      the issuance of the Company’s business
license.

                  

          

          

          
            	
                    6.04

                  	
                    The
      Parties shall pay their contributions according to such updated
      contribution schedule.

                     

                    For funds needed for financing a cost
      overrun, the management of the Company shall prepare a plan and submit it
      to the Board for determination of sources of
  funding.

                  

          

           

          
            	
                    6.05

                  	
                    Based
      on the needs of the Company, the dates and amounts of payments of capital
      contributions by the Parties shall be decided by the Board of
      Directors.

                  

          

          

          
            	
                    6.06

                  	
                    The
      Company shall issue a certificate of instalment contribution signed by the
      Chairman of the Board based on the certificate of verification issued by
      an accountant registered in China to the relevant Party within thirty (30)
      days each time after the Company has received the Party's contribution.
      The certificate of instalment contribution for each instalment shall list
      the actual amount of capital already paid by the Party and the time of
      payment.

                  

          

          

          
            	
                     
      

                  	
                    After
      the registered capital is completely paid up, the certificates of
      instalment contribution shall be replaced by a formal certificate of
      contribution stamped by the Company and confirmed by an accountant
      registered in China.

                  

          

          

          
            	
                    6.07

                  	
                    In
      the event that any Party fails to pay in all or part of its required
      capital contribution when due, it shall bear the responsibility for
      breaching the Contract as
stipulated.

                  

          

          

          
            	
                    ARTICLE
7

                  	
                    BOARD
      OF DIRECTORS

                  

          

          

          
            	
                    7.01

                  	
                    The
      date of issuance of the Company's business license shall be the date on
      which the Board shall be
constituted.

                  

          

          

          
            	
                    7.02

                  	
                    The
      Board of Directors is the authority of the Company, deciding all important
      and major matters of the Company and supervising the operation and
      management work of the management organization of the
    Company.

                  

          

          

          
            
              
              

            

            
              -6-

              
                

              

            

            
              
              

            

             

          

          
            	
                    7.03

                  	
                    The
      Board shall consist of three (3) members, of which one (2) shall be
      appointed by A and two (1) by B.

                  

          

          

          
            	
                     
      

                  	
                    No
      member of the Board shall have any personal liability for any act
      performed in his capacity as a member of the Board for the Company’s
      operation except for such acts as would constitute a personal violation of
      publicly issued laws and regulations of any jurisdiction to which the
      Company or the relevant member is
subject.

                  

          

          

          
            	
                    7.04

                  	
                    Each
      member of the Board shall be appointed for a term of three (3) years and
      may serve consecutive terms if reappointed by the Party originally
      appointing him. If a seat on the Board is vacated by the retirement,
      resignation or death of a member or by the removal of such member by the
      Party which originally appointed him, the Party which originally appointed
      such member shall appoint a successor to serve out such member's
      term.

                  

          

          

          
            	
                     
      

                  	
                    The
      members of the Board shall comply with the Articles of Association of the
      Company, earnestly implement their duties and protect the interests of the
      Company.

                  

          

          

          
            	
                    7.05

                  	
                    Hua,
      Yimin, the Chairman of the Board shall be appointed by A, and Karim
      Menassa the Vice Chairman, shall be appointed by B.

                     

                    The Chairman is the legal representative
      of the Company. He shall bind the Company in accordance with this
      Contract, the Articles of Association and the resolutions of the Board. In
      the event that any act by a Senior Staff violates the Contract, the
      Articles of Association or a Board resolution, the Chairman is entitled to
      and shall point out such violation in writing to the General Manager and
      require him to correct such violation immediately.

                     

                    

                      Should
      the Chairman be unable to exercise his duty due to any reason, he shall
      authorize in writing the Vice Chairman to represent the
      Company.

                    

                  

          

           

          
            	
                    7.06

                  	
                    Meetings
      of the Board shall be held at least twice (2) every year and should be
      held at the place of registration of the Company or may be held at other
      places either within or outside China decided upon by the Board. The first
      Board meeting shall be held within three (3) month after issuance of the
      Company's business license. The meetings shall be called and presided over
      by the Chairman. If the Chairman is unable to call a meeting, he shall
      entrust in written form the Vice Chairman to call and preside over the
      meeting.

                  

          

          

          
            	
                     
      

                  	
                    Upon
      the written request of no less than one third (1/3) of the members of the
      Board specifying the matters to be discussed, the Chairman of the Board
      shall convene an interim meeting of the Board to be held within six (6)
      weeks.

                     

                    
                      For
      the convention of a Board meeting all members shall be informed in writing
      of the date, venue and agenda ten (10) days before the meeting is
      held.

                      

                      All
      topics requested in writing by no less than one third (1/3) of the members
      of the Board shall be included by the Chairman into the agenda of the next
      Board meeting.

                    

                  

          

           

          
            	
                    7.07

                  	
                    Three
      (3) members of the Board present in person or represented by proxy shall
      constitute a quorum for the meeting of the
  Board.

                  

          

          

          
            	
                    7.07.1

                  	
                    In
      case a member of the Board is for any reason unable to participate in
      a  Board meeting, he shall issue a power of attorney and entrust
      a proxy to participate in the meeting on his behalf. The proxy so
      entrusted shall have the same rights and power as the member. Each of the
      Parties shall ensure that, after having been duly informed, the members
      appointed by it will attend all Board meetings in person or by proxy
      .

                  

          

          

          
            
              
              

            

            
              -7-

              
                

              

            

            
              
              

            

             

          

          
            	
                    7.07.2

                  	
                    Any
      failure to meet the quorum requirements stipulated in Article 7.07 as a
      result of the non-attendance of a duly convened Board meeting by one or
      more members for other reasons but Force Majeure shall constitute a breach
      of this Contract by the Party, which has appointed the non-attending
      member or members.

                  

          

          

          
            	
                    7.07.3

                  	
                    In
      case that a Board meeting cannot be held because the quorum is not met,
      the meeting shall be adjourned and the Chairman
      shall convene a Board meeting not later than three (3) months after the
      date of the adjourned meeting.

                  

          

          

          
            	
                    7.08

                  	
                    The
      General Manager and the Deputy General Manager shall attend the Board
      meetings. The Chairman may invite any of the other Managers to attend.
      Upon request of the Vice Chairman, the Chairman shall invite any of the
      other Managers to attend.

                     

                    
                      

                        Experts
      of each Party may attend the Board meetings upon invitation of a Party,
      after consultation between Chairman and Vice Chairman and with the
      Chairman's consent.

                        

                        All
      such attendees shall not have a voting
  right.

                      

                    

                  

          

           

          
            	
                    7.09

                  	
                    Resolutions
      involving the following matters may only be adopted by the affirmative
      vote of the majority of the members of the Board present (in person or by
      proxy) at the meeting constituting a
quorum

                  

          

          

          
            	
                     
      

                  	
                    (1)
      Approval of the annual budget (including, but not limited to, total sales,
      profit, financing and allocation of funds, investment and expenditures)
      and annual operation plan (including, but not limited to, purchasing,
      manufacturing  and maintenance, marketing, personnel and
      training), medium-term plans and long-term
  plans;

                  

          

          

          
            	
                     
      

                  	
                    (2)
      Approval of the annual report and the annual profit distribution
      plan;

                  

          

          

          
            	
                     
      

                  	
                    (3)
      Decision on allocations to the reserve fund, enterprise development fund
      and bonus and welfare fund for the workers and staff members and decisions
      regarding the use of such funds;

                  

          

          

          
            	
                     
      

                  	
                    (4)
      Decision on distribution of distributable
  profits;

                  

          

          

          
            	
                     
      

                  	
                    (5)
      Appointment and dismissal of Senior Staff and decisions in regard to their
      term of office, remuneration and other terms of
  employment;

                  

          

          

          
            	
                     
      

                  	
                    (6)
      The policy for the salary, bonus and welfare of the
    Employees;

                  

          

          

          
            	
                     
      

                  	
                    (7)
      Any significant change in the structure of the Company's management
      organization and establishment and cancellation of any branch organization
      of the Company;

                  

          

          

          
            	
                     
      

                  	
                    (8)
      Appointment and dismissal of the certified accounting
    company;

                  

          

          

          
            	
                     
      

                  	
                    (9)
      Establishment and change of important internal regulations and systems of
      the Company;

                  

          

          

          
            	
                     
      

                  	
                    (10)
      The marketing strategy (including pricing guidelines) of the divisions,
      the annual sales plan of the Company, the conclusion and termination of
      sales agency or distributorship contracts and any application for the
      registration of a trademark in the Company's
  name;

                  

          

          

          
            	
                     
      

                  	
                    (11)
      Any economic transaction of the Company with any Party or Affiliate of any
      Party in value exceeding RMB 150,000 or over one (1) year in period,,
      except those according to or regulated in the Joint Venture Contract or
      its Schedules or any Ancillary Contracts specified
  therein;

                  

          

          

          
            
              
              

            

            
              -8-

              
              

            

            
              
              

            

             

          

          
            	
                     
      

                  	
                    (12)
      Any technology transfer between the Company and either Party or third
      parties, including, but not limited to, the acquiring or disposing by the
      Company of industrial property and/or know how, the disposing or granting
      of licenses for industrial property rights and/or know how and agreements
      on trademarks;

                  

          

          

          
            	
                     
      

                  	
                    (13)
      Any investment(s) in fixed assets beyond the annual investment plan with
      an accumulated value exceeding RMB 50,000;or any leasing agreement
      regarding assets having a value exceeding RMB 50,000; or any leasing
      agreement with such other leasing period as may be determined by the
      Board;

                  

          

          

          
            	
                     
      

                  	
                    (14)
      Any investment in another enterprise, or any total or partial acquisition
      of another enterprise or of its
business;

                  

          

          

          
            	
                     
      

                  	
                    (15)
      The utilisation of any financial derivative
  instrument;

                  

          

          

          
            	
                     
      

                  	
                    (16)
      Any decision to change the business scope of the Company or any change of
      the capacities of the Plants set forth in the Joint Venture
      Contract;

                     

                    
                      (17)
      Any transaction concerning land use rights;

                      

                      (18)
      Any unplanned or non-budgeted transaction regarding buildings with a value
      exceeding RMB 50,000;and/or any sale, transfer, mortgage or other
      transaction regarding other assets of the Company with a value exceeding
      RMB 50,000;

                    

                  

          

          

          
            	
                     
      

                  	
                    (19)
      Any lawsuit or arbitration of the Company on important
      matters;

                  

          

          

          
            	
                     
      

                  	
                    (20)Any
      non-commercial sponsoring or donation exceeding RMB
  10,000;

                  

          

          

          
            	
                     
      

                  	
                    (21)
      Selection of insurance carriers for the Company's major insurances and
      decisions on major insurance
matters;

                  

          

          

          
            	
                     
      

                  	
                    (22)
      Any other matter to be decided by the Board according to the Joint Venture
      Contract or the Articles of
Association;

                  

          

          

          
            	
                     
      

                  	
                    (23)
      Any transaction or business of an important nature or not in the ordinary
      course of business of the Company.

                     

                    The Board may change the values of the
      thresholds set forth above.

                  

          

           

          
            	
                    7.10 
      

                  	
                    Resolutions
      involving any lawsuit or arbitration between the Company and any of the
      following enterprises shall be adopted by the affirmative vote of the
      majority of the members of the Board present (in person or by proxy)
      nominated by the other Parties:

                  

          

          

          
            	
                     
      

                  	
                    (1)
      one Party or its Affiliate;

                  

          

          

          
            	
                     
      

                  	
                    (2)
      another enterprise one third (1/3) or more of whose registered capital or
      voting rights are owned or controlled, directly or indirectly, by one
      Party or its Affiliate.

                  

          

          

          
            	
                    7.11      

                  	
                    The
      Board of Directors shall make minutes in Chinese and English on the
      results and resolutions of its meetings. The minutes of the Board of
      Directors shall become effective after signature by the Chairman and Vice
      Chairman.

                  

          

          

          
            	
                    7.12 
      

                  	
                    Between
      meetings, the Board may decide in writing by circular resolutions,
      provided that the necessary quorum and majority of all members of the
      Board are achieved.

                  

          

          

          
            	
                    ARTICLE 
      8

                  	
                    MANAGEMENT
      ORGANIZATION

                  

          

          

          
            
              
              

            

            
              -9-

              
                

              

            

            
              
              

            

             

          

          
            	
                    8.01

                  	
                    The
      Company shall have a management organization to be responsible for the
      day-to-day operational and managerial work of the Company under the
      leadership and supervision of the Board of
  Directors.

                  

          

          

          
            	
                    8.02

                  	
                    The
      Company shall have a General Manager nominated by Hua,
      Yimin and appointed by the Board of Directors. Each term of office
      shall be no more than three (3)
years.

                  

          

          

          
            	
                     
      

                  	
                    The
      Parties shall cause their members of the Board to appoint such
      nominee.

                     

                    Under the leadership of the Board of
      Directors, the General Manager shall have the overall responsibility to
      organize and lead the day-to-day operation and the management of the
      Company in accordance with this Contract, the Articles of Association and
      all resolutions of the Board of
Directors

                  

          

           

          
            	
                    8.03

                  	
                    The
      Deputy General Manager shall be nominated by Party A. The Parties shall
      cause their members of the Board to appoint such
  nominee.

                  

          

          

          
            	
                     
      

                  	
                    The
      Deputy General Manager shall report directly to and assist the General
      Manager in his work.

                  

          

          

          
            	
                     
      

                  	
                    The
      General Manager shall consult and try to reach agreement with the Deputy
      General Manager on important matters defined in Article 8.07. Reports and
      statements on such matters addressed to the General Manager shall be sent
      to the Deputy General Manager for information at the same
      time.

                  

          

          

          
            	
                     
      

                  	
                    In
      case the General Manager is absent he shall authorize the Deputy General
      Manager to perform the duties and responsibilities of the General
      Manager.

                  

          

          

          
            	
                    8.04

                  	
                    Based
      on actual special needs for certain know-how transfer as well as for
      marketing and training experience, the Parties agree that the Company may
      employ for periods of three (3) years Temporary Delegates from A/B. Such
      employment shall terminate three (3) years after the start of commercial
      production of the last Plant, the
latest.

                  

          

           

          
            	
                    8.05

                  	
                    A
      Senior Staff may be replaced for any reason at any time by the Party which
      originally nominated him. The Party having such intention shall inform the
      other Parties thereof as soon as possible.

                     

                    The Party which originally nominated such
      Senior Staff shall nominate a successor as soon as possible. The Parties
      shall cause their members of the Board to appoint such
      nominee.

                  

          

           

          
            	
                    8.06

                  	
                    The
      Company shall have a Management Committee (MC) to discuss and consult on
      important matters regarding the day-to-day operation and management. The
      MC shall consist of the General Manager, the Deputy General Manager and
      the other Managers.

                  

          

          

          
            	
                    8.07

                  	
                    The
      General Manager shall convene and preside over routine MC meetings held in
      principle twice a month. In case of absence of the General Manager, the
      Deputy General Manager shall convene and preside over the MC meeting.
      Important matters, including but not limited to the following, shall be
      discussed by the MC in order to assist the General Manager to make final
      decisions:

                  

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    Reports
      and plans to be submitted to the Board, including but not limited to the
      annual budget and operation plan, medium-term plans and long-term plans to
      be submitted to the Board;

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    Appointment
      and dismissal of any management staff at supervisor
  level;

                  

          

          

          
            	
                     
      

                  	
                    (3)

                  	
                    Establishment
      and change of important regulations and systems of the Company which are
      to be submitted to the Board;

                  

          

          

          
            
              
              

            

            
              -10-

              
                

              

            

            
              
              

            

             

          

          
            	
                     
      

                  	
                    (4)

                  	
                    Important
      matters relating to procurement, manufacturing, maintenance, sales,
      borrowing of the working capital or the annual
  budget;

                  

          

          

          
            	
                     
      

                  	
                    (5)

                  	
                    The
      marketing strategy (including pricing guidelines) of each operational
      division which is to be submitted to the
Board;

                  

          

          

          
            	
                     
      

                  	
                    (6)

                  	
                    Selection
      of the suppliers of important equipment, raw materials and other goods
      required in the production and
operation;

                  

          

          

          
            	
                     
      

                  	
                    (7)

                  	
                    Any
      economic transaction of the Company with any Party or Affiliate of any
      Party, except those regulated in this Contract or its Schedules or any
      Ancillary Contracts;

                  

          

          

          
            	
                     
      

                  	
                    (8)

                  	
                    Disciplinary
      action against those Employees who seriously violated the
      discipline;

                  

          

          

          
            	
                     
      

                  	
                    (9)

                  	
                    Important
      matters submitted by any member of the
MC;

                  

          

          

          
            	
                     
      

                  	
                    (10)

                  	
                    Any
      other matters authorized by the
Board.

                  

          

          

          The
minutes of the MC meeting shall become effective after joint signature by the
General Manager and the Deputy General Manager.

          

          
            	
                    8.08

                  	
                    In
      case a Senior Staff conducts a serious dereliction of his duties, he can
      be dismissed at any time by resolution of the Board followed by issuance
      of a dismissal notice signed by the Chairman of the Board. Such Senior
      Staff must not be nominated again.

                  

          

          

          
            	
                    8.09

                  	
                    Further
      details of the management organization of the Company shall be defined in
      the Articles of Association of the
Company.

                  

          

          

          The
powers and the responsibilities of the Senior Staff shall be listed in the Job
Descriptions for the Senior Staff ("Job Descriptions") to be signed by the
Parties. The Board may amend the Job Descriptions when necessary.

          

          
            	
                     ARTICLE
      9

                  	
                    THE PARTIES' RESPONSIBILITIES OF
      ASSISTANCE

                  

          

          

          
            	
                    9.01

                  	
                    Responsibilities
      of A.

                     

                    In addition to their other obligations
      under this Contract, A/B shall assist the Company in the following
      matters, as far as requested by the
Company:

                  

          

           

          
            	
                     
      

                  	
                    (1)

                  	
                    assist
      the Company to duly apply for and liaise with relevant Chinese
      governmental authorities in relation to all approvals, permits and
      licenses, etc. necessary for the build-up and operation of the
      Company;

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    assist
      the Company in obtaining licenses for the import and export of
      goods;

                  

          

          

          
            	
                     
      

                  	
                    (3)

                  	
                    assist
      in handling all other matters requested by the
  Company.

                  

          

          

          
            	
                    9.02

                  	
                    Responsibilities
      of B

                  

          

          

          In
addition to their other obligations under this Contract, A/B shall assist the
Company in the following matters, as far as requested by the
Company:

          

          
            	
                     
      

                  	
                    (1)

                  	
                    assist
      the Company to obtain entry visas, permits (if needed) and appropriate
      accommodation, transportation and medical care for its personnel and
      Chinese experts;

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    assist
      the Company to obtain necessary licenses and to handle custom formalities
      for the import and export of goods;

                  

          

          

          
            
              
              

            

            
              -11-

              
                

              

            

            
              
              

            

             

          

          
            	
                     
      

                  	
                    (3)

                  	
                    assist
      in handling all other matters requested by the
  Company.

                  

          

          

          
            	
                    9.03

                  	
                    Joint
      responsibilities of the Parties:

                  

          

          

          In
addition to its other obligations under this Contract, each Party shall assist
the Company in the following matters, as far as requested by the
Company:

          

          
            	
                     
      

                  	
                    (1)

                  	
                    assist
      the Company in applying for and obtaining investment incentives available
      for the Company;

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    assist
      the Company in applying to Chinese banks approved by the State
      Administration for Foreign Exchange ("SAFE") for the opening of foreign
      currency and Renminbi (RMB) accounts and in applying for loans required
      from Chinese or foreign banks under most favorable
    conditions.

                  

          

          

          
            	
                    9.04
      

                  	
                    The
      responsibilities of a Party may be performed by a Party's Affiliate,
      provided, however, that the Party shall remain responsible for the
      performance of its obligations under this
  Contract.

                  

          

          

          
            	
                    ARTICLE
      10  

                  	
                    TRANSFER
      OF TECHNOLOGY

                  

          

          

          
            	
                    10.01
      

                  	
                    Party
      B, Medical International Technologies (MIT Canada) Inc., will License to
      Jiangsu Hualan MIT MEDICAL TECHNOLOGY (MIT China) LTD. To produce, Market
      and sell. In China, Medical International Technologies (MIT Canada) Inc.,
      All NEEDLE-FREE JET INJECTOR existing and future products under the
      Patents and Trade marks, as per annex A
  attached.

                  

          

          

          
            	
                    ARTICLE 11

                  	
                    PURCHASE
      OF EQUIPMENT AND RAW MATERIALS

                  

          

          

          
            	
                    11.01    

                  	
                    The
      purchasing of all Machineries, Equipments and Raw materials will be done
      based on bidding process.

                  

          

          

          
            	
                    11.02    
      

                  	
                    Both
      parties will agree on the complete list of equipments and Machineries and
      Raw materials than:

                     

                    

                      (1)The
      Chinese party will supervise all purchases within China, and get the
      approval from the Canadian party.

                      

                      (2)The
      Canadian party will supervise the purchases outside china, and get the
      approval from the Chinese
party.

                    

                  

          

          

          
            	
                    ARTICLE
      12

                  	
                    UTILITIES,
      INFRASTRUCTURE AND SERVICES

                  

          

          

          
            	
                    12.01

                  	
                    The
      Company shall purchase the necessary utilities as well as services from
      the most competitive market source of supply with regard to quantity,
      quality, reliability, price, currency and other terms and
      conditions.

                  

          

          

          
            	
                     
      

                  	
                    The
      Company has the right to cover its demand of utilities and services by its
      own facilities and resources.

                  

          

          

          
            	
                    12.02

                  	
                    Upon
      reasonable and competitive terms and conditions to be agreed upon between
      A and the Company, A shall supply utilities and render services to the
      Company, if and to the extent requested by the Company and technically
      feasible and shall allow the Company to use A's infrastructure facilities
      and to integrate and connect the Company's infrastructure facilities with
      A's infrastructure facilities - and shall provide proper and sufficient
      land for those facilities of the Company with the approval of the relevant
      authority, provided that A has already a land use right for such
      land

                  

          

           

           

          
            
               

            

            
              -12-

              
                

              

            

            
               

            

          

           

          
             

             

          

          
            	
                    ARTICLE
      13

                  	
                    SALE
      OF PRODUCTS

                  

          

          

          
            	
                    13.01    

                  	
                    The
      Products shall be sold both in the domestic market and the export market,
      but will primarily be sold in the domestic market. The Board shall
      determine, based on market conditions and economic feasibility and the
      Company's overall marketing concept for the Products, the budgetary
      proportion of domestic and export sales of the Products. The proportion of
      the domestic and export sales shall finally depend on market conditions
      and profit targets.

                  

          

          

          
            	
                    ARTICLE
      14

                  	
                    SITE
      LAND AND BUILDING

                  

          

          

          
            	
                    14.01 
      

                  	
                    Pursuant
      to Annex

                  

          

          

          
            	
                    ARTICLE
      15

                  	
                    HEALTH,
      SAFETY AND ENVIRONMENT PROTECTION

                  

          

          

          
            	
                    15.01

                  	
                    The
      Parties agree to cause the Company to introduce and observe high standards
      designed to protect employees and public health, safety and the
      environment in conducting its production and other activities and to
      minimize the use of natural resources and consumption of energy by
      integrated management. They will cause the Company to develop a set of
      written standards ("Standards") which will incorporate all applicable laws
      and regulations of China and principles of relevant standards applied by
      the Parties to their own
facilities.

                  

          

          

          
            	
                    15.02

                  	
                    The
      General Manager shall at least once per year report to the Board of
      Directors on the compliance by the Company with applicable laws and
      regulations and the Standards.

                  

          

          

          
            	
                    15.03

                  	
                    The
      Company shall request the technology
      licensors and equipment suppliers to guarantee that the technologies and
      equipment provided by them to the Company shall meet the Standards in
      order to enable the Company to observe the laws and regulations of China
      on health, safety and environment
protection.

                  

          

          

          
            	
                    15.04

                  	
                    The
      Board shall have the right to inspect at any time the implementation by
      the management organization of the Company of the laws, regulations and
      Standards on health, safety and environment
  protection.

                  

          

          

          
            	
                    15.05

                  	
                    Each
      Party may send at its own expenses its internal safety and environmental
      protection department to inspect the observation by the Company of the
      applicable laws, regulations and Standards. The inspection personnel shall
      have the right to access all production and auxiliary facilities used by
      the Company and shall have the right to inspect all facilities, equipment,
      records, files and data. The inspection report shall be handed over to the
      Company.

                  

          

          

          
            	
                     
      

                  	
                    The
      aforementioned inspecting rights of each Party shall not replace or limit
      in any respect the legal responsibilities and contractual obligations of
      the Company concerning health, safety and environmental protection. That
      means the Parties shall not assume any responsibility by having such
      inspecting rights.

                  

          

          

          
            	
                    ARTICLE
      16

                  	
                    TRADEMARKS
      AND TRADE NAMES

                  

          

          

          
            	
                    16.01

                  	
                    The
      Company shall design, register and use its own company trademark (the
      "Company Trademark") and special trademarks for particular products, if
      deemed necessary, in accordance with the "Trademark Law of the People's
      Republic of China" and other relevant regulations. The designs of such
      Company Trademark and special trademarks and any of their future revisions
      shall be approved by the Board before registration and
  use.

                  

          

           

          
            
              
              

            

            
              -13-

              
                

              

            

            
              
              

            

          

           

          
            	
                    16.02

                  	
                    The
      Company Trademark shall be of a completely new design which shall not be a
      combination of registered trademarks of any of the Parties but may reflect
      the cooperation of the Parties in the
Company.

                  

          

          

          
            	
                     
      

                  	
                    The
      Company Trademark, once registered with the Trademark Bureau as the
      unifying brand of the Company, shall always be identified by â
      or TM,
      in accordance with its registration status in the respective country, when
      used for the Company's products and
services.

                  

          

          

          
            	
                     
      

                  	
                    If
      special trademarks are necessary for particular Products, such special
      trademarks may be designed and registered by the Company itself or the
      Company may license the respective special product trademarks from any
      Party, all subject to the approval of the
Board.

                  

          

          

          
            	
                    16.03

                  	
                    The
      Parties agree that without the prior written consent of A or b, as the
      case may be, they will not appropriate for their own use or allow the
      Company to appropriate for its use any trademark or trade name of any
      other Party, nor use any trademarks or trade names which are
      transliterations thereof or confusingly similar
  thereto.

                  

          

          

          
            	
                    16.04

                  	
                    Unless
      otherwise agreed between the Parties, in case the Company is dissolved or
      ceases to exist, all trademarks registered by the Company shall be
      cancelled.

                  

          

          

          
            	
                    ARTICLE
      17

                  	
                    FOREIGN
      EXCHANGE

                  

          

          

          
            	
                    17.01

                  	
                    The
      Company's foreign exchange matters shall be handled in accordance with the
      regulations of China relating to foreign
  exchange.

                  

          

          

          
            	
                    17.02

                  	
                    The
      Parties shall assist the Company in selecting banks which handle foreign
      exchange business to open foreign exchange accounts of the Company. All
      income and expenditures in foreign exchange of the Company shall be
      handled in the corresponding
accounts.

                  

          

          

          
            	
                    17.03

                  	
                    The
      Parties shall assist the Company in applying to SAFE for a maximum foreign
      exchange retention amount that can meet the requirements of production and
      operation.

                  

          

          

          
            	
                    17.04

                  	
                    The
      Company's annual plan for the use of foreign exchange shall be included in
      the annual budget and shall be submitted to the Board for
      approval.

                  

          

          

          
            	
                    17.05

                  	
                    The
      Company shall exert all reasonable efforts to avoid or reduce the risk of
      foreign exchange losses.

                  

          

          

          
            	
                    ARTICLE
      18

                  	
                    FINANCE,
      ACCOUNTING AND AUDITING

                  

          

          

          
            	
                    18.01

                  	
                    In
      the Finance, Accounting Division, there shall be a Accountant who reports
      directly to the division's General Manager. Under his direct leadership
      the Chief Accountant shall be responsible for the following
      areas:

                  

          

          

          
            	
                     
      

                  	
                    –

                  	
                    financial
      accounting and cost accounting,

                  

          

          
            	
                     
      

                  	
                    –

                  	
                    management
      information systems,

                  

          

          
            	
                     
      

                  	
                    –

                  	
                    electronic
      data processing and systems.

                  

          

          

          
            	
                     

                  	
                    The
      Accountant nominated by A shall be appointed by the
  Board.

                  

          

          

          
            	
                    18.02

                  	
                    The
      Company shall set up its financial and accounting systems in accordance
      with the relevant laws and regulations on financial and accounting systems
      in China and having regard to the special characteristics of the Company
      and have it approved by the Board.

                  

          

          

          
            	
                     
      

                  	
                    The
      Company shall issue the following financial and accounting
      reports:

                  

          

          

          
            
              
              

            

            
              -14-

              
                

              

            

            
              
              

            

             

          

          
            	
                     
      

                  	
                    (1)

                  	
                    All
      reports required in accordance with the relevant laws and
      regulations;

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    All
      reports required in accordance with internal regulations of B and to cope
      with legal requirements and rules regarding the consolidation of the
      financial statements of B;

                  

          

          

          
            	
                     
      

                  	
                    (3)

                  	
                    All
      reports required in accordance with internal regulations of
    A.

                  

          

           

          
            	
                     
      

                  	
                    The
      financial plans submitted by the Company to the respective Parties shall
      meet the requirements of the systems customary at the
Parties.

                     

                    The
      Company shall establish a modern system (hardware and software) in order
      to meet the Company’s and the Parties’ reporting
    requirements.

                  

          

          

          
            	
                    18.03

                  	
                    The
      accounting system adopted by the Company shall give a complete status of
      assets, liabilities, revenues and expenses and allow efficient management
      and control. The cost accounting system should be designed in a way to
      produce operating results by product/product groups including a system of
      predetermined costs.

                  

          

          

          
            	
                    18.04

                  	
                    The
      Company shall adopt Renminbi as its book keeping base currency. All
      accounting books, statements and reports including the annual report of
      the Company shall be made and kept in Chinese and
  English.

                  

          

          

          
            	
                     
      

                  	
                    All
      accounting books, statements and reports, as determined in the Articles of
      Association, shall be prepared and signed by the Chief Accountant and
      submitted to the General Manager of the Finance, Accounting Division for
      approval.

                  

          

          

          
            	
                    18.05

                  	
                    The
      accounting system and procedures adopted by the Company shall be
      implemented upon approval by the Board, and be submitted to the local
      financial and taxation authorities for filing as
  required.

                  

          

          

          
            	
                    18.06

                  	
                    The
      Company shall before the preparation of each year's annual statements call
      a meeting inviting all Parties to attend for reviewing the annual
      financial status and preparing the annual
  report.

                  

          

          

          
            	
                    18.07

                  	
                    The
      following documents, certificates and statements shall become effective
      only after verification by the accounting company and with certificates
      issued by the accounting company:

                  

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    Certificates
      issued by the Company to the Parties on the payment of registered
      capital;

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    The
      annual accounting reports of the Company;
and

                  

          

          

          
            	
                     
      

                  	
                    (3)

                  	
                    The
      accounting statement for the liquidation of the
  Company.

                  

          

          

          
            	
                    18.08

                  	
                    The
      General Manager shall submit to the Board of Directors as well as to the
      Parties the annual accounting report (including the profit and loss
      statement and balance sheet of the current year in both Chinese and
      English) and the audit report of the Company's auditor
      within  three (3) months after the end of the fiscal
      year.

                  

          

          

          
            	
                    18.09

                  	
                    Each
      Party may, at its own expense, appoint an accountant or its internal
      auditors, on behalf of such Party to audit the accounts of the Company.
      Reasonable assistance in providing the accounting books shall be given to
      such auditor and such auditor shall keep confidential all documents under
      his auditing.

                  

          

          

          
            	
                    18.10

                  	
                    The
      fiscal year of the Company shall coincide with the calendar year, i.e.
      from January 1 to December 31 each year. The first fiscal year of the
      Company shall be from the date when the business license of the Company is
      issued to December 31 of that year.

                  

          

          

          
            
              
              

            

            
              -15-

              
                

              

            

            
              
              

            

             

          

          
            	
                    18.11

                  	
                    For
      any of the transactions, the Company shall have the right to entrust an
      independent and licensed certified international auditing company
      registered in the country of the creditor to audit the correctness of any
      amount invoiced to the Company out of such transactions. Before initiating
      such audit, the Company shall request the respective Party in writing to
      clarify the relevant matter and shall attempt to settle it in amicable
      discussions. Reasonable assistance in providing the relevant documents and
      accounting books shall be given to such auditor by the audited party and
      such auditor shall keep confidential all documents under his
      auditing.

                  

          

          

          
            	
                     
      

                  	
                    The
      fees of the auditor shall be borne by the
  Company.

                  

          

          

          
            	
                     
      

                  	
                    If
      such auditing shows that an agreed upon price formula is no longer
      feasible because of legal, economic or political reasons, the respective
      parties shall re-negotiate such price formula in good
    faith.

                  

          

          

          
            	
                    ARTICLE
      19

                  	
                      DISTRIBUTION
      AND PAYMENT OF PROFITS

                  

          

          

          
            	
                    19.01

                  	
                    After
      the payment of all payable taxes and fulfilment of other relevant legal
      obligations by the Company, the Board shall determine the allocation to
      the reserve fund, to the bonus and welfare fund for the Company's
      personnel and to the Company's expansion fund in accordance with the
      relevant laws and regulations. Unless otherwise decided by the Board, the
      balance of profit after such allocation shall be distributed to the
      Parties according to the ratio in the registered capital of the
      Company.

                  

          

          

          
            	
                    19.02

                  	
                    Profits
      shall in principle be distributed and paid-out in RMB. The Board shall set
      an appropriate date of payment which shall not be later than thirty (30)
      days of the decision on the dividends. The Company shall pay the dividends
      on the date set by the Board in a way designated by the
      Parties.

                  

          

          

          
            	
                    19.03

                  	
                    The
      Company shall, at the request of Party B, convert the RMB dividends to be
      distributed to such Party into USD and remit the same out of China in
      favour of such Party in accordance with the then applicable regulations
      governing the payment of foreign exchange. Any foreign exchange rate risk
      until the payment date set by the Board as well as the banking expenses
      and other expenses shall be for the account of such Party.

                     

                    In
      case the Company has to purchase USD, the exchange rate applicable for
      such conversion and remittance outside of China shall be the selling rate
      of exchange of RMB to USD on the date of payment set by the Board from the
      bank where the Company keeps its foreign exchange account.

                    

                    The
      exchange rate to be used for conversion of RMB into foreign exchange (USD)
      available in the Company’s own account shall be the selling rate of
      exchange of RMB to USD at the day of payment set by the Board from the
      bank where the Company keeps its foreign exchange account. If the
      aforementioned selling rate is not available, then any equivalent rate
      prevailing at the day of payment set by the
  Board

                  

          

           

          
            	
                    19.04

                  	
                    Any
      reasonable interest accrued on the dividend to which a Party is entitled
      from the date of payment set by the Board to the date of actual payment
      shall be reimbursed by the Company to such
  Party.

                  

          

          

          
            	
                    ARTICLE
    20

                  	
                    TAXATION

                  

          

          

          
            	
                    20.01

                  	
                    The
      Company shall pay taxes in accordance with the provisions in the relevant
      laws and regulations of the state and local authorities. The personnel of
      the Company shall pay individual income tax according to the "Individual
      Income Tax Law of the People's Republic of China" and/or other relevant
      laws and regulations.

                  

          

          

          
            
              
              

            

            
              -16-

              
                

              

            

            
              
              

            

             

          

          
            	
                    20.02

                  	
                    In
      their relationship to the Chinese tax authorities the Parties shall bear
      all the taxes, dues and fees levied by Chinese tax authorities on the
      Parties in accordance with Chinese tax law with regard to the signing of
      this Contract and the Schedules or Ancillary Contracts of this
      Contract.

                  

          

          

          
            	
                     
      

                  	
                    The
      Company and the Parties shall fulfil the withholding and paying
      obligations stipulated by laws and regulations concerning the above taxes,
      dues and fees.

                  

          

          

          
            	
                    20.03

                  	
                    The
      Parties and the Company shall apply Articles 20.01 and 20.02 in accordance
      with the Chinese tax laws including the relevant treaties for avoidance of
      double taxation.

                  

          

          

          
            	
                    20.04

                  	
                    The
      Parties shall as early as possible submit to the department concerned
      applications for confirming that the Company is a technologically advanced
      enterprise, and assist the Company in its efforts to obtain all
      preferential conditions on taxation that are obtainable under Chinese law
      or upon specific permits in favour of the Company and/or the Parties and
      assist the Company in handling the relevant matters concerning exemption
      of customs duties and VAT.

                  

          

          

          
            	
                    ARTICLE
      21

                  	
                    INSURANCE

                  

          

          

          
            	
                    21.01

                  	
                    During
      construction and commercial operation, the Company shall take out and
      maintain full and adequate industrial insurance as well as appropriate
      personnel insurance cover according to the relevant laws and regulations
      of China and taking into consideration the insurance standards of A and
      B.

                  

          

          

          
            	
                    21.02

                  	
                    Various
      insurance of the Company shall be effected with licensed insurance
      companies incorporated in China. If and insofar as approved by the
      relevant Chinese authorities that the insurance can be effected with a
      foreign insurance company that has a Chinese
  license.

                  

          

          

          
            	
                    21.03

                  	
                    The
      Parties shall assist the Company by consulting and coordinating the
      insurance matters entrusted by the
Company.

                  

          

          

          
            	
                    ARTICLE
      22

                  	
                    LABOR
      MANAGEMENT

                  

          

          

          
            	
                    22.01

                  	
                    Within
      the scope of the relevant laws and regulations, the stipulations of this
      Contract, the Articles of Association and the Ancillary Contracts, the
      Company shall enjoy full autonomy in matters of recruitment, employment,
      dismissal, personnel development and training, remuneration, wages,
      welfare and other matters concerning its Employees and shall establish its
      own systems regarding
such  matters.

                  

          

          

          
            	
                    22.02

                  	
                    The
      number of Employees required for the start of commercial operation of the
      Company shall be determined in the Joint Feasibility Study Report. After
      the start of commercial operation, the management organisation may,
      depending on the actual need of the Company, put forward a plan for any
      increase or decrease of the number of Employees and submit it to the Board
      for discussion and decision.

                  

          

          

          
            	
                    22.03

                  	
                    The
      Company's principles relating to recruitment, personnel management,
      compensation, training, labor safety and health, insurance, welfare, labor
      union as well as to other personnel matters are set forth in the Personnel
      Guidelines. The Personnel Guidelines may be revised only by a resolution
      of the Board.

                  

          

          

          
            	
                    22.04

                  	
                    The
      Company shall regularly inform the Parties of its requirements for
      Employees. The Parties may recommend and, if they do so, shall recommend
      qualified personnel for the requirements. The Company shall have the right
      to choose from the recommended candidates or, if there are no qualified
      candidates, to recruit from the labor market.

                     

                    
                      All
      Employees shall be employed by the Company subject to successful
      examination.

                    

                  

          

          

          
            
              
              

            

            
              -17-

              
                

              

            

            
              
              

            

          

          

          
            
              	 	

                      In
      accordance with the law, a probation period shall be agreed upon in the
      labor contracts.

                      

                      If,
      during the probation period, an Employee has been proven to be unqualified
      for employment by the Company, the Company has the right to terminate the
      labor contract.

                       

                    
	
                      22.05

                    	
                      The
      Employees shall have the right to establish a labor union and carry out
      labor union activities in accordance with the relevant laws and
      regulations.

                    

            

          

          

          
            	
                    22.06

                  	
                    The
      Company shall apply its personnel development, remuneration and welfare
      systems equally to all Employees. In accordance with the laws and
      regulations and the principles laid down in the Personnel Guidelines, the
      Company shall sign individual labor contracts with its Employees
      reflecting their individual qualification for their function and
      responsibilities and, through consultations and negotiations, sign a
      collective labor contract with the labor union representing the
      Employees.

                     

                    The remuneration for all Employees shall
      reflect the functions, responsibilities and performance of the individual
      Employees, be in line with the laws and be competitive in the Chinese
      professional personnel market.

                  

          

           

          
            	
                    22.07

                  	
                    The
      Senior Staff shall be employed by the Company with individual employment
      contracts according to this Contract, the Articles of Association and the
      Personnel Guidelines, signed on behalf of the Company by the Chairman of
      the Board after a resolution.

                  

          

          

          
            	
                    22.08

                  	
                    In
      case of a seasonal or temporary physical labor requirement, the
      Company may employ temporarily Chinese personnel ("Short-Term
      Employees") from
      nearby on an individual contract
basis.

                  

          

          

          
            	
                    22.09

                  	
                    The
      Company shall conform to the laws and regulations concerning labor
      protection and ensure safe and civilised
  production.

                  

          

          

          
            	
                     
      

                  	
                    Labor
      insurance for the Employees shall be handled in accordance with the
      relevant laws and regulations.

                  

          

          

          
            	
                    22.10

                  	
                    The
      Employees shall have a sole employment by the Company; they are not
      delegated to the Company. The personnel files
      of all Employees shall be provided to the Company or its assigned agency
      recognized by the government after their employment by the
      Company.

                  

          

          

          
            	
                    22.11

                  	
                    The
      Company shall make all efforts to conduct training and improve the
      qualification of its personnel in cooperation with the Parties. It shall
      establish a high-standard training system and examination system, so that
      the personnel can satisfy the requirements of the Company in technology,
      manufacturing, marketing, sales and
management.

                  

          

          

          
            	
                    22.12

                  	
                    Unless
      otherwise set forth in this Contract or the Personnel Guidelines, the
      relevant labor management stipulations of this Article 22 relating to
      Employees shall also apply to Senior Staff and Temporary
      Delegates.

                  

          

          

          
            	
                    ARTICLE
      23

                  	
                    CONFIDENTIALITY

                  

          

          

          
            	
                    23.01

                  	
                    The
      Parties warrant that they shall not use any Confidential Information which
      has been provided by another Party or the Company during the negotiation
      or the establishment or operation of the Company and shall not disclose it
      to any third party without the written permission from the providing
      Party, unless otherwise agreed upon in
writing.

                  

          

          

          
            	
                     
      

                  	
                    "Confidential
      Information" shall mean any proprietary technical or commercial
      information which has not been made public. Documents and information
      requiring to be kept secret by the Parties shall be clearly indicated by
      the providing Party as such.

                  

          

          

          
            
              
              

            

            
              -18-

              
                

              

            

            
              
              

            

             

          

          
            	
                     
      

                  	
                    Irrespective
      of any termination of this Contract, this confidentiality obligation shall
      end as soon as a Confidential Information has legally come into the public
      domain.

                  

          

          

          
            	
                    23.02

                  	
                    The
      Parties and the Company shall sign confidentiality agreements with their
      employees who have access to Confidential
  Information.

                  

          

          

          
            	
                    23.03

                  	
                    The
      confidentiality obligations of the Parties shall survive the termination
      of this Contract or an assignment of any Party’s capital contribution in
      the Company for any reason, unless otherwise stipulated in the relevant
      contract regarding Confidential
Information.

                  

          

          

          
            	
                    23.04

                  	
                    The
      relevant confidentiality obligations of a Party and the Company relating
      to the transfer of technology are referred to in more detail in the
      relevant technology transfer
contract.

                  

          

          

          
            	
                    ARTICLE
      24 

                  	
                    FUTURE
      COOPERATION AND NON-COMPETITION

                  

          

          

          
            	
                    24.01

                  	
                    Unless
      the Parties agree otherwise, no Party nor their Affiliates shall, in
      China, construct or have constructed by any third party, or otherwise
      support the construction of, any new plant or expand any existing plant
      for the same products..

                  

          

          

          
            	
                    24.02

                  	
                    Unless
      the Parties agree otherwise, no Party nor their Affiliates
      shall   license or otherwise transfer technology to, or
      otherwise assist, any third party, to manufacture in China the same
      products.

                  

          

          

          
            	
                    24.03

                  	
                    Unless the Parties agree
      otherwise, no Party nor their Affiliates shall purchase or otherwise
      acquire, or hold or otherwise control, any equity interest in, or
      financially support, any company or enterprise which carries out or
      intends to commence, any production for the same products in
      China.

                  

          

          

          
            	
                    ARTICLE
      25

                  	
                    THE
      JOINT VENTURE TERM

                  

          

          

          
            	
                    25.01

                  	
                    This
      Contract shall commence on the Effective Date and its term shall be
      infinite years.

                  

          

          

          
            	
                    25.02

                  	
                    The
      term of the Company shall be from the issuance of its business license and
      shall be infinite years.

                  

          

          

          
            	
                    ARTICLE
      26

                  	
                    ASSIGNMENT
      OF INVESTMENT

                  

          

          

          
            	
                    26.01

                  	
                    If
      any Party wants to assign all or part of its capital contribution in the
      Company to a third party (including Affiliates), it must obtain the
      written consent of the other Party in accordance with the following
      stipulations.

                     

                    
                      The
      assigning Party is hereinafter referred to as the "Disposing
      Party".

                    

                  

          

           

          
            
              	
                      26.02

                    	
                      If
      one Party wants to assign all or part of its capital contribution in the
      Company to a third party except to an Affiliate, the Disposing Party shall
      notify the other Party in writing of such intention, its terms and
      conditions for such assignment and, if applicable, shall give detailed
      information on the potential assignee ("Notice of
      Assignment").

                    
	 	
                       

                      

                        The
      other Party shall have a pre-emptive right to purchase the offered capital
      contribution ("Pre-emptive Right").

                        

                        The
      other Party shall either consent to such assignment or exercise its
      Pre-emptive Right not later than forty-five (45) days after receiving the
      Notice of Assignment. If, within forty-five (45) days from the receipt of
      the Notice of Assignment, the other Party has not expressed its intention
      to purchase the Disposing Party’s capital contribution as offered and/or a
      written agreement on the purchase price and other terms and conditions of
      the assignment has not been reached, the Disposing Party may assign the
      offered capital contribution to a third party or, if applicable, to the
      nominated potential
assignee.

                      

                    

            

          

           

          
            
              
              

            

            
              -19-

              
                

              

            

            
              
              

            

          

           

          
            
              	 	 The
      terms and conditions of such assignment must not be more favourable than
      those offered to the other Party. The Disposing Party shall provide the
      other Party with a duplicate of the executed written agreement with the
      third party or a notarized statement confirming the terms and conditions
      stipulated in such agreement. 

                      

                      The
      other Party shall have the right to investigate the financial ability of
      the assignee to fulfil its obligations.  If the assignee is
      found not qualified, then the other Party does not have to
      consent.

                      

                      If
      unforeseeable events occur during one (1) month investigation period which
      clearly necessitate additional time, then, upon written request of the
      other Party specifying such events, the investigation period shall be
      prolonged sufficiently in writing by the Disposing Party.

                       

                    
	
                      26.03

                    	
                      Within
      the first twelve (12) Month from the issuance of the business license to
      the Company, both parties can assign a minimal part (11% max.) of its
      capital contribution to a third party by having a written consent of the
      other Party. Thereafter and During a period of five (5) years from the
      issuance of the business license to the Company, neither Party or parties
      shall assign all or part of its capital contribution to a third party
      (except to an Affiliate) without the written consent of all the Parties
      and the other Parties are not bound to either consent to such assignment
      or to exercise the Pre-emptive
Right.

                    

            

          

          

          
            	
                    26.04

                  	
                    If
      a member of one Party wants to assign all or part of its capital
      contribution in the Company to another member of its Party or to an
      Affiliate, then the Disposing Party shall notify the other Party in
      writing of such intention and shall give for the other Party’s assessment
      all information reasonably necessary to prove that the assignee can meet
      the conditions set forth in Article 26.05.

                     

                    
                      If
      the assignee meets the conditions set forth in Article 26.05, the other
      Party must consent in writing to such assignment not later than thirty
      (30) days after receiving the
information.

                    

                  

          

          
          

          
            	
                    26.05

                  	
                    Regarding
      this Contract and its Schedules as well as the Ancillary Contracts, all as
      amended from time to time, the assignee
shall:

                  

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    have
      adequate ability to fulfil or have fulfilled by the Disposing Party or a
      third party the contractual obligations
therein,

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    accept
      in writing all the regulations stipulated therein,
  and

                  

          

          

          
            	
                     
      

                  	
                    (3)

                  	
                    agree
      in writing to be bound by them in all
respect.

                  

          

           

          
            
              	 	 The
      Disposing Party shall provide the other Party with notarized copies of the
      assignment agreement with the assignee.
	 	 
	
                      26.06

                    	
                      Whenever
      the Disposing Party is entitled to an assignment in accordance with this
      Article 26 and if the conditions set forth in Article 26.05 are met by the
      assignee, the Parties shall

                    

            

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    sign
      or otherwise confirm in writing the assignment agreement between the
      Disposing Party and the assignee,

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    amend
      this Contract and the Articles of Association accordingly, and
      then

                  

          

          

          
            	
                     
      

                  	
                    (3)

                  	
                    cause
      their members of the Board to approve such assignment and the amendment to
      the Articles of Association, and

                  

          

          

          
            
              
              

            

            
              -20-

              
                

              

            

            
              
              

            

             

          

          
            	
                     
      

                  	
                    (4)

                  	
                    follow
      all other procedures required by the relevant laws and regulations to
      obtain approval of the assignment by the Examination and Approval
      Authority.

                  

          

          

          
            
              	
                      26.07

                    	
                      After
      affirmative resolution of the Board, the assignment of the capital
      contribution shall be submitted to the Examination and Approval Authority
      for approval. After receiving such approval, the Company shall register
      the change of equity interest with the State Administration for Industry
      and Commerce.

                    
	 	 
	 	

                      Any
      change of equity interest in the Company shall conform with the relevant
      Chinese laws and regulations.

                    

            

          

          
          

          
            	
                    26.08

                  	
                    The
      assignment of its capital contribution by a Party shall not affect the
      operation of the Company or the implementation of the Contract and its
      Schedules as well as the Ancillary Contracts, all as amended from time to
      time.

                  

          

          

          
            	
                    26.09

                  	
                    No
      Party shall mortgage, pledge, or otherwise encumber all or any part of its
      capital contribution to the Company’s registered capital without the prior
      written consent of the other Party, provided, however, that each Party may
      pledge, assign or otherwise grant a security interest in all or any part
      of its rights or benefits in this Contract (including without limitation
      its capital contributions) as security for the financing of the Plants,
      all as specifically agreed in the financing
  contracts.

                  

          

          

          
            	
                    26.10

                  	
                    The
      assignment, mortgage, pledge or other encumbrance by a Party of its
      capital contribution not complying with the stipulations herein shall be
      invalid and shall constitute a breach of this Contract and such Party
      shall compensate the other Party and the Company for damages caused
      thereby.

                  

          

          

          
            	
                    26.11

                  	
                    Unless
      expressly provided otherwise, the stipulations of this Article 26 shall
      not apply in the cases stated in Articles
27.

                  

          

          

          
            	
                    ARTICLE 27 
      

                  	
                    TERMINATION
      AND LIQUIDATION

                  

          

          

          
            	
                    27.01

                  	
                    For
      the purpose of this Article 27, a Party shall mean either A or
      B.

                  

          

          

          
            	
                    27.02

                  	
                    This
      Contract may be terminated if the Parties agree in writing that a
      termination of the Contract is in the best interests of the Parties, due
      to

                  

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    circumstances
      which make it impossible for the Company to operate effectively (failure
      to attain business goals and lack of future development),
    or

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    the
      conditions or consequences of Force Majeure prevailing for a period in
      excess of six (6) months which have rendered the Company unable to
      continue the operation, or

                  

          

          

          
            	
                     
      

                  	
                    (3)

                  	
                    any
      other reasons.

                  

          

          

          
            	
                     
      

                  	
                    The
      Parties shall do their utmost to avoid a liquidation of the Company. Thus,
      before agreeing on termination, the Parties shall evaluate possibilities
      to continue the operation of the Company by one Party or by a third party.
      In the termination agreement, the Parties may agree that a Party may
      purchase by itself or have a third party purchase the other Party’s
      capital contribution and continue the operation of the Company. If both
      Parties are willing to purchase or have a third party purchase the other
      Party’s capital contribution, the Party which offers the higher price for
      the respective capital contribution shall have the right to purchase or
      have a third party purchase it. If the Company cannot continue to be
      operated in this way, its liquidation may be decided by the
      Board.

                  

          

          

          
            
              
              

            

            
              -21-

              
                

              

            

            
              
              

            

             

          

          
            	
                     
      

                  	
                    Any
      such assignment or decision on liquidate shall be submitted to the
      Examination and Approval Authority for
approval.

                  

          

          

          
            	
                    27.03

                  	
                    Under
      the following circumstances, either Party may terminate this Contract by
      written notice to the other Party:

                  

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    If
      a Party or any member of it materially breaches this Contract or the Articles of
      Association (i.e. seriously infringes the non-breaching Party’s and/or the
      Company's interests) and such breach
      is not cured within fifteen (15) days after receipt of written notice from
      the non-breaching Party;

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    If
      a Party or any member of it assigns or encumbers its capital contribution
      in the Company in violation of the provisions of this
      Contract;

                  

          

          

          
            	
                     
      

                  	
                    (3)

                  	
                    If
      a member of the other Party is declared bankrupt or is the subject of
      proceedings for liquidation or dissolution or ceases to carry on business,
      or becomes unable to pay its debts as they become due and therefore is
      subject to conciliation and reorganization or receivership, and if in such
      case the other members of the other Party do not or cannot take over the
      affected member's capital contribution and/or the Subordinated Shareholder
      Loans in the Company within thirty (30) days after receipt of written
      notice from the non-affected Party;

                  

          

          

          
            	
                     
      

                  	
                    (4)

                  	
                    If
      the accumulated losses of the Company after start of commercial production
      exceed seventy percent (70%) of the registered
      capital and the Parties are unable to reach an agreement for the
      restructuring of the Company's capitalization within thirty (30) days of
      receipt of written notice by either Party from the other
      Party.

                  

          

          

          
            	
                    27.04

                  	
                    No
      Party shall exercise its unilateral termination right as provided for in
      Article 27.03 without having consulted with the other Party in order to
      find an equitable solution. Such equitable solution may include an
      assignment of capital contribution within one
  Party.

                  

          

          

          
            	
                    27.05

                  	
                    If
      either Party's economic interests are adversely and materially effected by
      the promulgation of any new law of China or the amendment of any existing
      law of China after the signing of the Contract, such Party shall inform
      the other Party thereof in writing.

                  

          

          

          
            	
                     
      

                  	
                    The
      Parties shall then immediately consult with each other in order to find a
      feasible solution and they shall

                  

          

          

          
            	
                     
      

                  	
                    (1)

                  	
                    use
      all lawful efforts to reduce these adverse effects to a minimum
      and

                  

          

          

          
            	
                     
      

                  	
                    (2)

                  	
                    try
      to reach an agreement to avoid a unilateral
  termination.

                  

          

          

          
            	
                     
      

                  	
                    Either
      Party may terminate this Contract if no agreement has been reached within
      twelve (12) months from the written information mentioned
      above.

                  

          

          

          
            	
                    27.06

                  	
                    In
      the circumstances of Article 27.03 sub-paragraphs (1) and (2), the Party
      failing to implement the obligations specified in the Contract and the
      Articles of Association and materially breaching the Contract shall be
      liable for compensating the losses thus caused to the other
      Party.

                  

          

          

          
            	
                    27.07

                  	
                    If
      this Contract is terminated pursuant to Article 27.03 sub-paragraphs (1)
      or (2), then the non-breaching Party shall have the right and option to
      purchase by itself or to cause a third party to purchase the capital contribution of
      the breaching member of the other Party ("Purchase
    Option").

                  

          

          

          
            
              
              

            

            
              -22-

              
                

              

            

            
              
              

            

             

          

          
            	
                    27.08

                  	
                    If
      this Contract is terminated according to Article 27.03 sub-paragraph (3),
      then the non-affected Party shall have the Purchase Option for the capital
      contribution of the affected member of the other
  Party.

                  

          

          

          
            	
                    27.09

                  	
                    If
      the Contract is terminated according to Article 27.03 sub-paragraph (4),
      then either Party wishing to implement a restructuring shall have a
      Purchase Option. If both Parties, separately, are willing to implement a
      restructuring, then the Party which offers the higher price for the
      respective capital contribution shall have the Purchase Option. If neither
      Party is willing to implement a restructuring and no third party is
      willing to continue the operation of the Company, the Company shall be
      liquidated, unless otherwise decided by the
  Board.

                  

          

          

          
            	
                    27.10

                  	
                    In
      the event this Contract is terminated according to Article 27.05, the
      terminating Party shall have the right to cause the other Party to
      purchase itself or to cause a third party to purchase its capital
      contribution ("Sale Option") and the other Party shall have a Purchase
      Option.

                  

          

          

          
            	
                    27.11

                  	
                    The
      Party having a Purchase Option or Sale Option according to Articles
      27.07 through 27.10 shall exercise this option by written notice to the
      other Party within thirty (30) days after the written notice on
      termination of the Contract.

                  

          

          

          
            	
                     
      

                  	
                    If
      a Purchase Option cannot be exercised and consumed because of legal or
      political reasons attributable to China, then the Party having the
      Purchase Option shall have a Sale
Option.

                  

          

          

          
            	
                    27.12

                  	
                    If
      a Purchase Option is exercised or in case of an assignment in accordance
      with Article 27.09 with the result of members of both Parties still
      participating in the Company, then this Contract shall be continued
      between such members of both Parties and shall be amended
      accordingly.

                  

          

          

          
            	
                    27.13

                  	
                    Any
      change of equity interest in the Company shall conform with the relevant
      Chinese laws and regulations. The exercise of a Purchase Option or Sale
      Option shall be subject to the approval of the Examination and Approval
      Authority. After receiving such approval, the Company shall register the
      change of equity interest with the State Administration for Industry and
      Commerce.

                  

          

          

          
            	
                    27.14

                  	
                    Each
      Party shall be obliged to ensure that at least up to the assignment of its
      capital contribution the operation of the Company shall not be interrupted
      by any such assignment and that negative effects are kept to a minimum.
      After the assignment, they are obligated to continue at reasonable
      conditions such services, deliveries, rights etc. which are vital for the
      operation of the Company. Services and deliveries shall not be interrupted
      until new contracts have been concluded in accordance with the above
      mentioned principle.

                  

          

          

          
            	
                    27.15

                  	
                    In
      the event that the Contract is terminated by any Party for any reason
      covered in Article 27.03 or 27.05 and the Party having the Purchase Option
      or Sale Option does not exercise its option, the Company shall be
      liquidated, unless otherwise decided upon by the
  Board.

                  

          

          

          
            	
                    27.16

                  	
                    For
      dissolution and liquidation of the Company, the Board shall prepare an
      application for dissolution and submit it to the relevant Examination and
      Approval Authority for approval. The date of approval for the dissolution
      of the Company by the Examination and Approval Authority shall be the date
      of commencement of the liquidation of the
  Company.

                  

          

          

          
            	
                    27.17

                  	
                    With
      the approval of the Board, the liquidation committee may employ necessary
      experts and working personnel to handle concrete matters of
      liquidation.

                  

          

          

          
            
              
              

            

            
              -23-

              
                

              

            

            
              
              

            

             

          

          
            	
                    27.18

                  	
                    When
      the property to be liquidated is sold off, the Parties shall have the
      right of first refusal and the property shall be purchased by the Party
      which offers the highest price.

                  

          

          

          
            	
                    27.19

                  	
                    The
      remaining property after the clearance of debts of the Company shall be
      sold or disposed of and the proceeds shall be distributed among the
      Parties according to the proportion of their capital
      contributions.

                  

          

          

          
            	
                    27.20

                  	
                    On
      completion of the liquidation, the liquidation committee shall submit a
      liquidation completion report to the original Examination and Approval
      Authority after adoption by the Board, and the Company shall go through
      the formalities for nullifying its registration in the original
      registration authority and hand back its business
  license.

                  

          

          

          
            	
                    27.21

                  	
                    After
      the conclusion of the liquidation of the Company, all the accounting books
      and documents shall be left in the care of
A.

                  

          

          

          
            	
                    27.22

                  	
                    In
      the event that the Company fails to set up the liquidation committee
      within fifteen (15) days starting from the date of commencement of
      liquidation or that the liquidation committee comes across serious
      obstacles in its work and it is impossible for it to submit the
      liquidation report to the Examination and Approval Authority within six
      (6) months starting from the date of commencement of liquidation, any
      Party may make an application to the Court for
  liquidation.

                  

          

          

          
            	
                    27.23

                  	
                    If
      the Company has been declared to be bankrupt according to law, the
      relevant laws and administrative regulations on liquidation in bankruptcy
      shall be followed.

                  

          

          

          
            	
                    ARTICLE
      28

                  	
                    BREACH
      OF CONTRACT

                  

          

          

          
            	
                    28.01

                  	
                    If
      a Party fails to perform any of its obligations under this Contract or if
      a Party's representation or warranty under this Contract is untrue or
      materially inaccurate, such Party shall be deemed to have breached this
      Contract (hereinafter referred to as the Breaching
  Party).

                  

          

          

          
            	
                    28.02

                  	
                    The
      Breaching Party shall correct such breach within thirty (30) days after
      receipt of written notice from any other Party specifying the breach. If,
      after such a period, the breach is not corrected, then the Breaching Party
      shall bear the liability for compensation to the other Parties for all
      direct damages as well as foreseeable indirect and consequential damages
      caused by the breach.

                  

          

          

          
            	
                    28.03

                  	
                    In
      the event that a Party fails to pay in all or part of its required capital
      contribution when due, it shall pay to the Company interest on the amount
      overdue equal to the People’s Bank of China prime interest rate times
      4.

                  

          

          

          
            	
                    ARTICLE
    29

                  	
                    FORCE
      MAJEURE

                  

          

          

          
            	
                    29.01

                  	
                    "Force
      Majeure" shall mean all events which are beyond the control of the Parties
      and which are unforeseen, or, if foreseen, the happening and consequences
      of which are unavoidable and can not be overcome, that prevent any of the
      Parties or the Company from executing the Contract according to the agreed
      terms and conditions and that occur after the Effective
    Date.

                  

          

          

          
            	
                    29.02

                  	
                    If
      an event of Force Majeure occurs, the performance of affected contractual
      obligations of the Parties shall be suspended during the period of delay
      caused by the Force Majeure except for the obligations pursuant to Article
      23, and shall be automatically extended for a period equal to such
      suspension.

                  

          

          

          
            	
                    29.03

                  	
                    The
      Party claiming Force Majeure shall notify the other Parties without any
      delay.

                  

          

          

          
            
              
              

            

            
              -24-

              
              

            

            
              
              

            

             

          

          
            	
                    29.04

                  	
                    In
      the event of Force Majeure, the Parties shall immediately consult with
      each other in order to find an equitable solution and shall use all
      reasonable efforts to minimize the consequences of such Force
      Majeure.

                  

          

          

          
            	
                    ARTICLE
      30

                  	
                    APPLICABLE
      LAW

                  

          

          

          
            	
                    30.01

                  	
                    The
      conclusion, validity, interpretation and implementation of this Contract,
      and the resolution of disputes thereunder shall be governed by the present
      and future published laws of China.

                  

          

          

          
            	
                    30.02

                  	
                    The
      Company and the Parties shall be entitled to apply for any preferential
      treatment under the policies on investment or in other fields that are
      issued and implemented by the relevant governmental authorities after
      signing of this Contract and that are more favourable than those set forth
      in current Chinese policies.

                  

          

          

          
            	
                    ARTICLE
      31

                  	
                    SETTLEMENT
      OF DISPUTES

                  

          

          

          
            	
                    31.01

                  	
                    In
      the event any dispute arises in connection with the validity,
      interpretation or implementation of this Contract, the Parties shall
      attempt in the first instance to resolve such dispute through friendly
      consultations. If the dispute cannot be resolved in this manner
      within  thirty (30) days after the date on which one Party has
      served written notice on the other Party or Parties for the commencement
      of consultations, then any Party may refer the dispute to
      court/arbitration.

                  

          

          

          
            	
                    31.02

                  	
                    When
      any dispute occurs and when any dispute is under arbitration, except for
      the matters under dispute, the Parties shall continue to exercise their
      remaining respective rights, and fulfil their remaining respective
      obligations under this Contract.

                  

          

          

          
            	
                    ARTICLE
      32

                  	
                    LANGUAGE,
      EFFECTIVENESS OF CONTRACT AND MISCELLANEOUS
  PROVISIONS

                  

          

          

          
            
              	
                      32.01

                    	
                      Language

                    
	 	 
	 	

                      This
      Contract is written in Chinese and English. Both language versions are
      equally authentic.

                      This
      contract must be identical to the Chinese version, otherwise this contract
      must be corrected by both
parties.

                    

            

          

           

          
            
              	
                      32.02

                    	
                      Effectiveness
      of the Contract

                    
	 	 
	 	This
      Contract shall become effective on the Effective Date as defined in
      Article 1. 09.

            

          

           

          
            
              	
                      32.03

                    	
                      Original
      version

                    
	 	 
	 	This
      Contract shall be made in ten (10) originals (each including a Chinese and
      an English version).

            

             

          

          
            
              	
                      32.04

                    	
                      Severability

                    
	 	 
	 	 In
      the event that any provision in this Contract is ille­gal, contrary to
      public policy, or otherwise unenforceable, then such provision shall be
      deleted from this Contract leaving the remainder of this Contract legal,
      valid and enforceable. The deleted provision shall be replaced by a valid
      new provision negotiated by the Parties, having as nearly as is legally
      possible the same economic and business effect as the illegal or
      unenforceable provision was intended to have. The new provision shall be
      submitted to the Examination and Approval Authority for its
      approval.
	 	 
	32.05	 Waiver

            

          

          

          
            
              
              

            

            
              -25-

              
                

              

            

            
              
              

            

          

                                    

          
            	
                     
      

                  	
                    Unless
      expressly provided otherwise, failure or delay on the part of a Party to
      exercise any right, power or privilege under this Contract, or under any
      other agreement relating hereto, shall not operate as a waiver thereof;
      nor shall any single or partial exercise of any right, power or privilege
      preclude any other future exercise
thereof.

                  

          

          

          
            
              	
                      32.06

                    	
                      Binding
      Effect, Amendments

                    
	 	 
	 	 This
      Contract is made for the benefit of the Parties and is binding on the
      Parties. 

                      

                      This
      Contract may only be amended by a written instrument signed by the Parties
      and, if required, approved by the Examination and Approval
      Authority.

                    

            

             

          

          
            
              	32.07	
                        Notices

                       

                    
	
                       
      

                    	
                      Any
      notice or other formal written communication provided for in this Contract
      by either Party to the other shall be made in English by telefax or
      electronic mail and confirmed by a letter transmitted by courier against
      written receipt or by registered airmail letter, promptly transmitted or
      addressed to the appropriate
Party.

                    

            

          

          

          
            	
                    32.08  

                  	
                    Schedules

                  

          

           

          This
Contract has been signed by the duly authorized representatives of the Parties
at the place and on the date first set forth above.

          

          

          
            	
                     
      

                  	
                    A
      Corporation

                  

          

          

          
            	
                     
      

                  	
                    By__________________

                  

          

          

          

          

          

          
            	
                     
      

                  	
                    B
      Corporation

                  

          

          

          
            	
                     
      

                  	
                    By__________________f8k050609ex10ii_mit.htm

    Exhibit 10.2

     

    
      THE
SECURITIES THAT ARE THE SUBJECT OF THIS STOCK PURCHASE AGREEMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE APPLICABLE
SECURITIES LAWS OF ANY STATE AND WILL BE OFFERED AND SOLD IN RELIANCE ON
EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THESE LAWS BY VIRTUE OF THE
INTENDED COMPLIANCE BY THE ISSUER WITH REGULATION S OF THE SECURITIES
ACT.  THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
U.S. SECURITIES AND EXCHANGE COMMISSION (THE “SEC”), ANY STATE SECURITIES
COMMISSION OR ANY OTHER REGULATORY AUTHORITY.  ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.

      

      

      

      

      STOCK
PURCHASE AGREEMENT

      

      THIS SUBSCRIPTION AGREEMENT
(the “Agreement”) is made and entered into as of this 15th day of
May, 2009, by and between Medical International Technology,
Inc. a Colorado corporation (the “Company”), with its offices located at
1872 Beaulac Montreal (Saint-Laurent) QC Canada H4R 2E7 and  with its
address located at    (the
“Purchaser”).

      

      RECITALS:

      

      WHEREAS, the Company is
offering for sale­­______________ (_____) units (individually, a
“Unit” and, collectively, the “Units”), each Unit consisting of one share of
(POST REVERSE SPLIT) common stock, $0.0001 par value per share (the “Common
Stock”) at a per Unit price of $0.10, in a transaction exempt
from registration under Regulation S of the Securities Act of 1933, as amended
(the “Securities Act”), and the regulations promulgated thereunder.

      

      NOW, THEREFORE, in
consideration of the premises and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

      

      SECTION
1.0: PURCHASE AND SALE OF UNITS.

      

      Section 1.1  Closing.  The Company
agrees to issue, sell and deliver to the Purchaser, and the Purchaser agrees to
purchase and receive from the Company, _______(_______) Units upon the terms
and conditions set forth in this Agreement.  The closing (the
“Closing”) of the sale and purchase of the Units shall take place at the
Company’s offices, at 12:00, local time, on May 15th , 2009, or at such other time
and place as may be agreed to by the parties (the “Closing
Date”).  The Units, shall be restricted and the certificates
representing the securities shall bear the restrictive legend pursuant to Rule
144 of the General Rules and Regulations under the Securities Act.

      

      Section 1.2  Purchase
Price.  The total
purchase price for the Units (the “Purchase Price”) shall consist of cash in the
amount of ________(_____) US
DOLLARS.

      

      SECTION
2.0: REPRESENTATIONS AND WARRANTIES.

       

       

      
        
           

        

        
          - 1 -

          
            

          

        

        
           

        

      

      
 

      Section 2.1  Representations
and Warranties of the Purchaser. The Purchaser makes the following
representations and warranties to the Company.

      

      (a)  Speculative
Investment.  The Purchaser is aware that an investment in the
Units is highly speculative and subject to substantial risks.  The
Purchaser is capable of bearing the high degree of economic risk and the burden
of this venture, including, but not limited to, the possibility of complete loss
of the Purchaser’s investment in the Units that makes liquidation of this
investment impossible for the indefinite future.

      

      (b)  Privately
Offered.  The offer to issue and sell the Units was
communicated directly to the Purchaser in such a manner that the Purchaser was
able to ask questions of and receive answers concerning the terms and conditions
of this transaction.  At no time was the Purchaser presented with or
solicited by or through any leaflet, public promotional meeting, television
advertisement or any other form of general advertising.

      

      (c)  Purchase for
Investment.  The Units are being acquired solely for the
Purchaser’s own account, for investment purposes and are not being purchased
with a view to the resale, distribution, subdivision or fractionalization
thereof without proper registration with appropriate securities administrators
or an applicable exemption from such registration.  The Purchaser will
comply with all applicable law with respect to any resale of the
Units.

      

      (d)  Access to
Information.  The Purchaser or the Purchaser’s professional
advisor has been granted the opportunity to ask questions of and receive answers
from representatives of the Company and its officers, directors, employees and
agents concerning the terms and conditions of the offering of the Units, the
Company and its business and prospects, and to obtain any additional information
that the Purchaser or the Purchaser’s professional advisor deems necessary to
verify the accuracy and completeness of the information received.

      

      (f)  Reliance on Own
Advisors.  The Purchaser has relied on the advice of, or has
consulted with, the Purchaser’s own tax, investment, legal or other advisors and
has not relied on the Company or any of it affiliates, officers, directors,
attorneys, accountants or any affiliates of any thereof and each other person,
if any, who controls any thereof, within the meaning of Section 15 of the
Securities Act, for any tax or legal advice.  The foregoing, however,
does not limit or modify the Purchaser’s right to rely upon representations and
warranties of the Company in Section 2.2 of this Agreement and any
representations of any third parties acting as agents for or on the Company’s
behalf.

      

      (g)  Capability to
Evaluate.  The Purchaser has such knowledge and experience in
financial and business matters so as to enable such Purchaser to utilize the
information made available to it in connection with the offer of the Securities
in order to evaluate the merits and risks of the prospective
investment.

      

      (h)  Authority.  The
Purchaser (and each of its subsidiaries, if applicable) is a corporation duly
incorporated and existing in good standing under the laws of the State of New
York and has the requisite corporate power to own its properties and to carry on
its business as now being conducted.  The Purchaser has full power and
authority to execute and deliver this Agreement and each other document included
herein (if any) for which a signature is required and to act in accordance with
the terms of this Agreement and such other documents (if any).

       

      
        
           

        

        
          - 2 -

          
            

          

        

        
           

        

      

       

      
 

      (i) Non United States
Person.  The Undersigned is not a US person under Rule 902 of
Regulation S under the Securities Act, and is not acquiring the Stock for the
account or benefit of any US person; and is, if a natural person, over 21 years
of age.

      

      The
foregoing representations and warranties shall be true and accurate as of the
date hereof and as of the date of any acceptance of this Offer by the Company
and shall survive the date of such acceptance by the Company.

      

      Section 2.2  Representations
and Warranties of the Company.  The Company
hereby makes the following representations and warranties to the
Purchaser:

      

      (a)  Organization and
Qualification.  The Company is a corporation duly incorporated
and existing in good standing under the laws of the state of Colorado and has
the requisite corporate power to own its properties and to carry on its business
as now being conducted.

      

      (b)  Authorization;
Enforcement.  (i) The Company has the requisite corporate power
and authority to enter into and perform this Agreement and to issue and sell the
Units in accordance with the terms hereof; (ii) the execution and delivery of
this Agreement by the Company and the consummation by it of the transactions
contemplated hereby have been duly authorized by all necessary corporate action,
and no further consent or authorization of the Company or its Board of Directors
or stockholders is required; (iii) this Agreement has been duly executed and
delivered by the Company; and (iv) this Agreement constitutes a valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms (except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws
relating to, or affecting generally, the enforcement of, creditors’ rights and
remedies or by other equitable principles of general application).

      

      (c)  Authorized Capital; Rights
or Commitments to Stock.  As of April 1st 2009,
the authorized capital stock of the Company consists of 103,000,000 shares, of
which 100,000,000 shares are Common Stock, of which 53,058,663 shares are issued
and outstanding, and 3,000,000 shares are preferred stock, of which no shares
are issued and outstanding.  All of the outstanding shares of the
Company’s Common Stock have been validly issued and are fully paid and
non-assessable.

      

      (d)  Issuance of
Securities.  The issuance of the Units has been duly authorized
and, when paid for and issued in accordance with the terms hereof, the Units,
shall be validly issued, fully paid and non-assessable
and entitled to the rights inherent in the securities and as specified
herein.

      

      (e)  No
Conflicts.  The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby do not and will not (i) result in a violation of the
Company’s Articles of Incorporation or Bylaws or (ii) conflict with, or
constitute a default (or an event that with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Company or any of its subsidiaries is a party, or result
in a violation of any federal, state, local or foreign law, rule, regulation,
order, judgment or decree (including federal and state securities laws and
regulations) applicable to the Company its subsidiary or by which any property
or assets of the Company or its subsidiary is bound or affected (except for such
conflicts, defaults, terminations, amendments, accelerations, cancellations and
violations as would not, individually or in the aggregate, have a Material
Adverse Effect); provided that, for purposes of such representation as to
federal, state, local or foreign law, rule or regulation, no representation is
made herein with respect to any of the same applicable solely to the Purchaser
and not to the Company.  The business of the Company is not being
conducted in violation of any law, ordinance or regulations of any governmental
entity, except for violations that either singly or in the aggregate do not and
will not have a Material Adverse Effect.  The Company is not required
under federal, state or local law, rule or regulation in the United States to
obtain any consent, authorization or order of, or make any filing or
registration with, any court or governmental agency in order for it to execute,
deliver or perform any of its obligations under this Agreement or issue and sell
the Units in accordance with the terms hereof, and the payment of any filing or
other fees required by such governing authority; provided that, for purposes of
the representation made in this sentence, the Company is assuming and relying
upon the accuracy of the relevant representations and agreements of the
Purchaser herein.

       

      
        
           

        

        
          - 3 -

          
            

          

        

        
           

        

      

      
 

      (f)  Reporting Status. The
Company is subject to the reporting requirements of Section 13 of the Securities
Exchange Act of 1934, as amended.  The Company is not an investment
company or a developmental stage company that has no specific business plan or
purpose.  No information or documentation provided to the Purchaser as
of the date hereof has contained any untrue statement of a material fact or has
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading.

      

      (g)  No General
Solicitation.  Neither the Company, nor any of its affiliates,
or, to the best of its knowledge, any person acting on its or their behalf, has
engaged in any form of general solicitation or general advertising in connection
with the offer or sale of the Units.

      

      (h)  No Integrated
Offering.  Neither the Company, nor any of its affiliates, nor
any person acting on its or their behalf has, directly or indirectly, made any
offers or sales of any of the Company’s securities or solicited any offers to
buy any of such securities, under circumstances that would prevent the Company
from offering the Units pursuant to Regulation S under the Securities
Act.

      

      

      SECTION
3.0: COMPLIANCE AND INSTRUCTIONS.

      

      Section 3.1  Securities
Compliance.  The Company
shall, to the extent required, notify the SEC and the NASD Over-the-Counter Pink
sheet, in accordance with their requirements, of the transactions contemplated
by this Agreement, and shall take all other necessary action and proceedings, as
may be required by applicable law, rule and regulation, for the legal and valid
issuance of the Units to the Purchaser.

      

      Section 3.2  Transfer
Agent Instructions.

      

      a.  Common Stock to be Issued With
Restrictive Legend.  Upon the Closing, the Company shall
instruct its transfer agent to issue certificates for _________(_____) shares of Common Stock
to be received by the Purchaser pursuant to this Agreement, with a restrictive
legend pursuant to Rule 144 under the Securities Act, in the name of the
Purchaser and in such denominations to be specified by the
Purchaser.

      

      SECTION 4.0: GENERAL
CONDITIONS.

      

      Section 4.1  General
Conditions Precedent to the Obligation of the Company to Sell the
Shares.  The obligation
hereunder of the Company to issue and/or sell the Units to the Purchaser is
subject to the satisfaction, at the Closing, of each of the conditions set forth
below.  These conditions may be waived by the Company at any time in
its sole discretion.

       

       

      
        
           

        

        
          - 4 -

          
            

          

        

        
           

        

      

       

      
 

      (a)  Accuracy of the Purchaser’s
Representations and Warranties.  The representations and
warranties of the Purchaser shall be true and correct in all material respects
as of the date when made and as of the Closing Date as though made at that time
(except for any representations and warranties that are effective as of a
particular, specified date).

      

      (b)  Performance by the
Purchaser.  The Purchaser shall have performed all agreements
and satisfied all conditions required to be performed or satisfied by the
Purchaser at or prior to the Closing.

      

      (c)  No Injunction, No Legal
Action.  No statute, rule, regulation, executive order, decree,
ruling or injunction shall have been enacted, entered, promulgated or endorsed
by any court or governmental authority of competent jurisdiction that prohibits
the consummation of any of the transactions contemplated by this
Agreement.  No legal action, suit or proceeding shall be pending or
threatened that seeks to restrain or prohibit the transactions contemplated by
this Agreement.

      

      (d)  Purchase
Price.  The Purchaser shall have delivered the applicable
Purchase Price for the Units to be purchased, in accordance with Section 1.2
above.

      

      Section 4.2 General
Conditions Precedent to the Obligation of the Purchaser to Purchase the
Shares.  The obligation
hereunder of the Purchaser to purchase and pay for the Units is subject to the
satisfaction, at the Closing, of each of the conditions set forth
below.  These conditions may be waived by the Purchaser at any time in
its sole discretion.

      

      (a)  Accuracy of the Company’s
Representations and Warranties.  The representations and
warranties of the Company shall be true and correct in all material respects as
of the date when made and as of the Closing Date as though made at that time
(except for representations and warranties that are effective as of a
particular, specified date).

      

      (b)  Performance by the
Company.  The Company shall have performed all agreements and
satisfied all conditions required to be performed or satisfied by the Company
pursuant to this Agreement at or prior to the Closing, unless any such agreement
or condition is waived by the Purchaser in writing at or prior to
Closing.

      

      (c)  Trading and
Listing.  The Company shall not have received notice of, and
trading in the Company’s Common Stock shall not have been, suspended by the SEC
or a national securities exchange (currently the Over-the-Counter Pink sheet)
(except for any suspension of trading of limited duration agreed to between the
Company and the principal exchange on which the Common Stock is traded solely to
permit dissemination of material information regarding the Company) or de-listed
by such exchange, and trading in securities generally as reported by such
exchange shall not have at any prior time been suspended or limited, or minimum
prices shall not have been established on securities whose trades are reported
by such exchange.

      

      (d)  No
Injunction.  No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or governmental authority of competent jurisdiction that
prohibits the consummation of any of the transactions contemplated by this
Agreement.

       

       

      
        
           

        

        
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      SECTION
5.0: TERMINATION.

      

      Section 5.1  Termination.  This Agreement
may be terminated at any time prior to the Closing by the mutual written consent
of the Company and the Purchaser.  This Agreement may be terminated by
action of the respective Board of Directors or other governing body of the
Purchaser or the Company at any time if the Closing shall not have been
consummated by the fifth (5th) business day following the date of this
Agreement, provided that the party seeking to terminate the Agreement is not in
breach of the Agreement.  This Agreement shall automatically terminate
without any further action of either party hereto if the Closing shall not have
occurred by the seventh (7th) business day following the date of this Agreement,
provided, however, that any such
termination shall not terminate the liability of any party that is then in
breach of the Agreement.

      

      SECTION
6.0: MISCELLANEOUS.

      

      Section 6.1  Fees and
Expenses.  The parties shall
each pay the fees, commissions and expenses of its respective advisers, brokers,
finders, counsel, accountants and other experts, if any, and all other expenses
associated therewith, in accordance with their respective
agreements.

      

      Section
6.2  Specific Enforcement,
Consent to Jurisdiction.

      

      (a)  The
Company and the Purchaser acknowledge and agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise
breached.  It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent or cure breaches of the provisions of
this Agreement and to enforce specifically the terms and provisions hereof, this
being in addition to any other remedy to which either of them may be entitled by
law or equity.

      

      (b)  The
Company and the Purchaser each (i) hereby irrevocably submits to the
jurisdiction of the United States District Court and other courts of the United
States sitting in the State of Colorado for the purposes of any suit, action or
proceeding arising out of or relating to this Agreement and (ii) hereby waives,
and agrees not to assert in any such suit, action or proceeding, any claim that
it is not personally subject to the jurisdiction of such court, that the suit,
action or proceeding is brought in an inconvenient forum or that the venue of
the suit, action or proceeding is improper.  The Company and the
Purchaser each consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address in effect for
notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof.  Nothing in
this paragraph shall affect or limit any right to serve process in any other
manner permitted by law.

      

      Section 6.3  Entire
Agreement: Amendment. This Agreement contains the
entire understanding of the parties with respect to the matters covered hereby
and, except as specifically set forth herein, neither the Company nor the
Purchaser makes any representation, warranty, covenant or undertaking with
respect to such matters.  No provision of this Agreement may be waived
or amended other than by a written instrument signed by the party against whom
enforcement of any such amendment or waiver is sought.

       

       

      
        
           

        

        
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      Section 6.4  Notices.  Any notice or
other communication required or permitted to be given hereunder shall be in
writing and shall be effective (a) upon hand delivery or delivery by telex (with
correct answer back received), telecopy or facsimile at the address or number
designated below (if delivered on a business day during normal business hours
where such notice is to be received) or the first business day following such
delivery (if delivered other than on a business day during normal business hours
where such notice is to be received) or (b) on the second (2nd) business day
following the date of mailing by express courier service, fully prepaid, addressed to
such address, or upon actual receipt of such mailing, whichever shall first
occur.

      

      

      

      The addresses for such communications
shall be:

      

      To the
Company:     Medical International
Technology, Inc.

          1872
Beaulac

          Montreal
(Saint-Laurent) QC

          Canada H4R
2E7

      

          Attention:  Mr.
Karim Menassa, Chairman President & Director

      

      
        	
                To
      the Purchaser:

              	
                At
      the address set forth in the first paragraph of this Agreement or as
      specified hereafter in writing by the
Purchaser.

              

      

      

      Either
party hereto may from time to time change its address for notices by giving at
least ten (10) days’ written notice of such changed address to the other party
hereto.

      

      

      Section 6.5  Waivers.  No waiver by
either party of any default with respect to any provision, condition or
requirement of this Agreement shall be deemed to be a continuing waiver in the
future or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of either party to exercise any right hereunder in
any manner impair the exercise of any such right accruing to it
thereafter.

      

      Section 6.6  Headings.  The headings
herein are for convenience only, do not constitute a part of this Agreement and
shall not be deemed to limit or affect any of the provisions
hereof.

      

      Section 6.7  Governing
Law.  This Agreement is
deemed made, and the transactions contemplated herein are deemed to have taken
place in, the State of Colorado.  This Agreement shall be governed by
and construed and enforced in accordance with the internal laws of the State of
Colorado without regard to such state’s principles of conflict of
laws.

      

      Section 6.8  Survival.  The
representations and warranties of the Company and the Purchaser contained in
herein and the agreements and covenants set forth in Sections 1.1 and 1.2, 2.1
and 2.2 and 4.1 and 4.2 shall survive for a period of three (3) years after the
Closing Date.

      

      Section 6.9  Publicity.  The Company
agrees that it will not disclose, and will not include in any public
announcement, the name of the Purchaser without its consent, unless and until
such disclosure is required by law or applicable regulation, and then only to
the extent of such requirement.

      

      Section 6.10  NASD. The term “NASD” or “NASD
Over-the-Counter Pink sheet” herein refers to the principal market on which the
Common Stock of the Company is traded.  If the Common Stock is listed
on a securities exchange, or if another market becomes the principal market on
which the Common Stock is traded or through which price quotations for the
Common Stock are reported, the term “NASD” or “NASD Over-the-Counter Pink sheet”
shall be deemed to refer to such exchange or other principal
market.

       

       

      
        
           

        

        
          - 7 -

          
            

          

        

        
           

        

      

       

      
 

      Section 6.11  Acceptance.  Execution and
delivery of this Agreement by the Purchaser shall constitute an offer to
purchase the Units, which offer, unless previously revoked by the Purchaser, may
be accepted or rejected by the Company, in its sole discretion for any cause or
for no cause and without liability to the Purchaser.  The Company
shall indicate acceptance of this Agreement by signing as indicated on the
signature page hereof.

      

      Section 6.12  Binding
Agreement. Upon
acceptance of this Agreement by the Company, the Purchaser agrees that it may
not cancel, terminate or revoke any agreement of the Purchaser made hereunder,
and that this Agreement shall be binding upon the successors and assigns of the
Purchaser.

      

      Section 6.13  Counterparts.  This Agreement
may be signed in multiple counterparts, which counterparts shall constitute one
and the same original instrument.

      

      Section
6.14  Severability.  If any portion of this Agreement
shall be held illegal, unenforceable, void or voidable by any court, each of the
remaining terms hereof shall nevertheless remain in full force and effect as a
separate contract.

      

      

      Section 6.15  Successors
and Assigns.  This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.

      

      IN WITNESS WHEREOF, the
parties hereto have duly executed and delivered this Agreement as of the day and
year first above written.

      

      

      Dated:
May 15th
2009

      

      THE
COMPANY

      

      

      

      _____________________________________

      Karim
Menassa, Chairman, President, Director

      On Behalf
Of the Board

      

      

      THE
PURCHASER:

      

      

      

      

      _____________________________________

       

       

      - 8
-

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