Document:

EXHIBIT 10.12

 

INCENTIVE STOCK OPTION AGREEMENT

 

INCENTIVE
STOCK OPTION AGREEMENT dated as of                               ,
between IC INDUSTRIES, INC., a Delaware Corporation (the “Corporation”), and                               ,
an employee of the Corporation or one of its subsidiaries (the “Holder”).

 

WHEREAS, the Corporation desires, by affording the Holder an
opportunity to purchase shares of the Corporation’s Common Stock as hereinafter
provided, to carry out the purposes of the IC Industries 1982 Stock Option,
Restricted Stock Award and Performance Award Plan (the “Plan”), as approved by
the shareholders of the Corporation on May 6, 1982;

 

WHEREAS, the Management Resources and Compensation Committee of the
Board of Directors of the Corporation (the “Committee”) has duly made all
determinations necessary or appropriate to the grant hereof;

 

NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth and for other good and valuable consideration,
receipt of which is hereby acknowledged, the parties hereto have agreed, and do
hereby agree, as follows:

 

1.                                       The
Corporation hereby irrevocably grants to the Holder, as a matter of separate
agreement and not in lieu of salary or any other compensation for services, the
right and option (the “Option”), to purchase           
shares of Common Stock of the Corporation on the terms and conditions herein
set forth.  This Option shall be
considered an incentive stock option within the meaning of Section 422A of
the Internal Revenue Code of 1954, as amended (the “Code”).

 

2.                                       For
each of said shares purchased, the Holder shall pay to the Corporation $             
per share (the “Option Price”).

 

3.                                       The
term of this Option shall be a period of ten years from the date hereof, or
such shorter period as is prescribed pursuant to paragraphs 7 and 8
hereof.  This Option shall not be
exercisable until six months after the date hereof.  Thereafter, this Option shall be exercisable
in whole or in part at any time during said term as to any or all shares
covered hereby; provided, however, that the Corporation shall not be required
to issue any fractional shares pursuant to exercise of this option.  Except as provided in paragraphs 7 and 8
hereof, this Option may not be exercised unless the Holder shall, at the time
of exercise, be an employee of the Corporation or one of its “subsidiaries,” as
defined in the Plan.

 

4.                                       Anything
herein to the contrary notwithstanding, this Option and any related Alternate
Stock Right shall not be exercisable while there is outstanding any incentive
stock option which was granted to the Holder, before the grant of this Option,
to purchase shares of stock of the Corporation or one of its subsidiaries
(determined at the time of granting this Option) or a predecessor of any such
corporation.  An incentive stock option
shall be treated as outstanding for this purpose until it is exercised in full
or expires by reason of lapse of time.

 

5.                                       This
Option may be exercised only by one or more notices in writing of the Holder’s
intent to exercise this Option, delivered to the treasurer of the Corporation
or, at the risk of the Holder, mailed to the Treasurer of the Corporation at
One Illinois Center, 111 East Wacker Drive,

 

 

Chicago,
Illinois 60601, and accompanied by payment by check payable to the Corporation
in an amount equal to the aggregate Option Price of the total number of whole
shares then being purchased; provided, however, at the election of the Holder,
payment of the Option Price may be made by tender to the Corporation of that
number of shares of its Common Stock (not less than 25% of the number of shares
originally covered by this Option), represented by negotiable certificates,
which, when valued at the fair market value of the Corporation’s Common Stock
on the date of exercise (as determined by the Committee), is equal to the
Option Price.

 

6.                                       This
Option is not transferable by the Holder otherwise than by will or the laws of
descent and distribution, and may be exercised, during the lifetime of the
Holder, only by the Holder.

 

7.                                       In
the event of the termination of employment of the Holder with the Corporation
or one of its subsidiaries, including termination of employment by reason of
retirement pursuant to Corporation policy or disability, the Holder may (unless
such termination was for cause or a voluntary termination without the written
consent of the Corporation) exercise this Option at any time within three
months (or one year, if the Holder is permanently disabled within the meaning
of Section 105(d)(4) of the Code) after such termination, but only if and
to the extent this Option was exercisable at the date of termination, and in no
event after the date on which this Option would otherwise terminate.

 

8.                                       In
the event of the death of the Holder (i) while he is employed by the
Corporation or one of its subsidiaries, (ii) within three months after
termination of the Holder’s employment (other than termination for cause, a
voluntary termination without the written consent of the Corporation, or a
termination by reason of permanent disability within the meaning of section 105(d)(4)
of the Code), or (iii) within one year after termination of the Holder’s
employment by reason of such disability, then this Option may be exercised by
the legatees of the Holder under his last will, or by his personal
representatives or distributees, at any time within a period of nine months
after the Holder’s death, but only if and to the extent this Option was
exercisable at the date of death (unless death occurs while the Holder is employed
by the Corporation or one of its subsidiaries, in which case all shares subject
to this Option shall be deemed to be fully exercisable), and in no event after
the date on which this option would otherwise terminate.

 

9.                                       If,
prior to the termination of this option, the number of outstanding shares of
Common Stock of the Corporation shall be increased or decreased by reason of a
stock split, stock dividend, reverse stock split or combination, then the
number of shares at the time subject to this Option, the number of shares
reserved for issuance pursuant to exercise hereof, and the Option Price per
share shall be proportionately adjusted without any change in the aggregate
Option Price therefor.

 

10.                                 If,
prior to the termination of this Option, the outstanding shares of Common Stock
of the Corporation shall be affected by any change other than those
specifically mentioned in the preceding paragraph (e.g., by reason of a
recapitalization. merger, consolidation, exchange of shares, and the like),
then the aggregate number and class of shares thereafter subject to this Option
and the Option Price thereof, and the number and class of shares reserved for
issuance pursuant to exercise hereof, may be appropriately adjusted in such
manner as the Committee shall in its sole

 

2

 

discretion
determine to be equitable and consistent with the purposes of the Plan.  Such determination shall be conclusive for
all purposes of this Option.

 

11.                                 This
option and each and every obligation of the Corporation hereunder are subject
to the requirement that if at any time the Corporation shall determine, upon
advise of counsel, that the listing, registration, or qualification of the
shares covered hereby upon any securities exchange or under any state or
Federal law, or the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of or in connection with the granting of
this Option or the purchase of shares hereunder, this Option may not be exercised
in whole or in part unless and until such listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
not acceptable to the Board of Directors of the Corporation.

 

12.                                 In
the event of a “change in control,” as that term is defined in the Plan, the
Holder shall have all of the rights specified in Paragraph 10(A) of the Plan.

 

13.                                 Nothing
herein contained shall confer on the Holder any right to continue in the
employment of the Corporation or any of its subsidiaries or interfere in any
way with the right of the Corporation or any subsidiary to terminate the Holder’s
employment at any time; confer on the Holder any of the rights of a shareholder
with respect to any of the shares subject to this Option until such shares
shall be issued upon the exercise of this Option; affect the Holder’s right to
participate in and receive benefits under and in accordance with the provisions
of any pension, profit-sharing, insurance, or other employee benefit plan or
program of the Corporation or any of its subsidiaries; or limit or otherwise
affect the right of the Board of Directors of the Corporation (subject to any
required approval by the shareholders) at any time or from time to time to
alter, amend, suspend or discontinue the Plan and the rules for its
administration; provided, however, that no termination or amendment of the Plan
may, without the consent of the Holder, adversely affect the Holder’s rights
under this Option.

 

ALTERNATE STOCK RIGHT

 

14.                                 In
lieu of exercising all or any portion of this Option, the Holder may elect, by
request in writing directed to the Corporation, in exchange for the surrender
of this Option or any portion thereof which is exercisable on the date the
Holder makes such request, to receive shares of the Corporation’s Common Stock,
cash, or any combination thereof, in the discretion of the Committee, having an
aggregate fair market value which is equal to the excess of the fair market
value as of the date of such request of one share of such Common Stock, as
determined by the Committee, over the purchase price specified in this option,
multiplied by the number of shares of such Common Stock covered by this Option
or portion thereof which is so surrendered.

 

15.                                 The
granting of any request by the Holder pursuant to this Alternate Stock Right
will be made only if the then current fair market value of the Corporation’s
Common Stock exceeds the Option Price and shall be subject to such additional
terms and conditions as the Committee shall determine to be desirable or
appropriate or necessary in order to comply with applicable laws or the rules
and regulations as in effect from time to time of the Securities and Exchange
Commission and the Internal Revenue Service. 
No fractional shares shall be issued in connection with the exercise of
this Alternate Stock Right.

 

3

 

IN WITNESS WHEREOF, the Corporation has caused this Incentive Stock
Option Agreement to be duly executed by an officer thereunto duly authorized,
and the Holder has hereunto set his hand, all as of the day and year first
above written.

 

	
  .

  	
  IC
  INDUSTRIES, INC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
    Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Holder

  

 

4EXHIBIT 10.1
------------

                                                                  Execution Copy

                          AGREEMENT AND PLAN OF MERGER

     AGREEMENT AND PLAN OF MERGER  ("Agreement") made this 23rd day of February,
2005 by and among  Bangla  Property  Management,  Inc.,  a Colorado  corporation
("Parent"), China Property Holding, Inc., a Colorado corporation ("Merger Sub"),
and Wollaston  Industrial  Limited,  ("the  Company") a British  Virgin  Islands
("BVI") limited liability corporation.

                                R E C I T A L S:

     A. The  respective  Boards of  Directors  of Parent  and the  Company  have
determined  that an acquisition of the Company by Merger Sub and then the merger
of  Merger  Sub with and into the  Parent  (the  "Merger"),  upon the  terms and
subject to the conditions set forth in this Agreement,  would be fair and in the
best interests of their  respective  shareholders,  and such Boards of Directors
have  approved  such  Merger,  pursuant to which  shares of Common  Stock of the
Company ("Company Common Stock") issued and outstanding immediately prior to the
Effective  Time of the Merger (as defined in Section 1.03) will be exchanged for
the right to receive Common Stock of Parent  ("Parent  Common Stock") other than
Dissenting Shares (as defined in Section 2.01(d)).

     B.   Parent,   Merger  Sub  and  the   Company   desire  to  make   certain
representations,  warranties,  covenants and  agreements in connection  with the
Merger and also to prescribe various conditions to the Merger.

     C. For federal  income tax  purposes,  the  parties  intend that the Merger
shall  qualify as a  reorganization  under the  provisions of Section 368 of the
Internal Revenue Code of 1986, as amended (the "Code").

     NOW,  THEREFORE,  in  consideration  of  the  representations,  warranties,
covenants  and  agreements  contained in this  Agreement,  the parties  agree as
follows:

                                   ARTICLE I:
                                   ----------
                                   THE MERGER

1.01 The Merger.  Upon the terms and subject to the conditions set forth in this
---------------
Agreement,  and in accordance with the Colorado Corporations Code (the "Colorado
Statutes"),  Merger Sub shall  acquire the Company and then shall be merged with
and into the Parent at the Effective Time of the Merger. The Company will become
a wholly owned subsidiary of the Parent.  The Parent shall at all times maintain
no less than 90 per cent of the equity of the Merger Sub.

1.02  Closing.  Unless  this  Agreement  shall  have  been  terminated  and  the
-------------
transactions  herein  contemplated shall have been abandoned pursuant to Section

                                        1
<PAGE>

7.01 and subject to the  satisfaction  or waiver of the  conditions set forth in
Article VI, the closing of the Merger (the  "Closing")  will take place at 10:00
a.m. on the  business  day after  satisfaction  of the  conditions  set forth in
Article  VI (or as soon as  practicable  thereafter  following  satisfaction  or
waiver of the conditions set forth in Article VI) (the "Closing  Date"),  at the
offices of Baker & McKenzie in New York.,  unless another date, time or place is
agreed to in writing by the parties hereto.

1.03 Effective Time of Merger. As soon as practicable following the satisfaction
-----------------------------
or waiver of the  conditions  set forth in Article  VI, the  parties  shall file
articles of merger (the  "Articles of Merger")  executed in accordance  with the
relevant provisions of the Colorado Statutes and shall make all other filings or
recordings  required under Colorado Statutes.  The Merger shall become effective
at such time as the  Articles  of Merger are duly filed  with the  Secretary  of
State of Colorado or at such other time as is  permissible  in  accordance  with
Colorado  Statutes and as Parent and the Company shall agree should be specified
in the  Articles  of Merger  (the time the Merger  becomes  effective  being the
"Effective Time of the Merger"). Parent shall use reasonable efforts to have the
Closing Date and the Effective Time of the Merger to be the same day.

1.04  Effects of the Merger.  The Merger shall have the effects set forth in the
---------------------------
applicable provisions of the Colorado Statutes.

1.05 Articles of Incorporation; Bylaws; Purposes.
------------------------------------------------

     (a) The Certificate of  Incorporation  of the Parent in effect  immediately
prior  to the  Effective  Time  of  the  Merger  shall  be  the  Certificate  of
Incorporation  of the Parent  until  thereafter  changed or amended as  provided
therein or by applicable law.

     (b) The Bylaws of the Parent in effect at the Effective  Time of the Merger
shall be the  Bylaws of the  Parent  until  thereafter  changed  or  amended  as
provided therein or by applicable law.

     (c) The  purposes  of the  Parent  and the total  number of its  authorized
capital stock shall be as set forth in the Certificate of  Incorporation  of the
Parent in effect  immediately  prior to the  Effective  Time of the Merger until
such time as such  purposes  and such  number may be amended as  provided in the
Certificate of Incorporation of the Parent and by applicable law.

1.06 Directors. The directors of the Company at the Effective Time of the Merger
--------------
shall be the  directors  of the Parent  within  twenty  days after the Merger or
within the required timeframe of the 14F filing ("Transition  Period"),  and its
subsidiary,  until the  earlier of their  resignation  or removal or until their
respective  successors are duly elected and  qualified,  as the case may be. The
current  sole  director  of the Parent  ("Parent  Director")  shall  remain as a
director for the sole purpose of  transition  during the  Transition  Period and
shall not take any action other than the ordinary  maintenance  and the election
of the new directors designated by the Company. The Parent Director shall resign
after the  election of all the new  directors  designated  by the  Company.  The
Parent and the Company shall hold the Parent Director harmless and indemnify the
Parent Director against any and all claims,  losses and damages arising from the
execution of the limited function during the Transition Period. At the Effective
Time of the Merger, Jiahui (as defined herein) shall appoint the other directors
of the Parent.

                                        2
<PAGE>

1.07 Officers.  The officers  designated by the Company at the Effective Time of
-------------
the Merger  shall be the  officers of the Parent and its  subsidiary,  until the
earlier of their resignation or removal or until their respective successors are
duly elected and qualified, as the case may be.

                                   ARTICLE II:
                                   -----------
                              EFFECT OF THE MERGER
                              ON THE CAPITAL STOCK
                         OF THE CONSTITUENT CORPORATIONS

2.01 Effect on Capital Stock. As of the Effective Time of the Merger,  by virtue
----------------------------
of the Merger  and  without  any action on the part of the  holders of shares of
Company Common Stock or any shares of capital stock of Merger Sub:

     (a)  Company-Owned  Common  Stock of Merger Sub. All the  Company's  shares
issued and  outstanding  prior to the Merger  ("Company  Common Stock") shall be
converted into 100 shares of common stock of the Merger Sub prior to the Merger.
Each share of common  stock of Merger Sub  issued  and  outstanding  immediately
prior  to the  Effective  Time of the  Merger  owned  by the  Company  shall  be
converted  into  226,750  shares of Common  Stock of the Parent and shall be the
issued and  outstanding  capital  stock of the  Parent.  In the  aggregate,  the
Company-owned  common stock of the Merger Sub shall be converted into 22,675,000
shares of the Parent.

     (b) Cancellation of Parent-Owned  Merger Sub Common Stock. The Parent shall
own 900 shares of commons tock of the Merger Sub prior to the Merger. Each share
of  Common  Stock  of  the  Merger  Sub  that  is  owned  by  the  Parent  shall
automatically  be cancelled and retired and shall cease to exist,  and no Parent
Common  Stock or  other  consideration  shall be  delivered  or  deliverable  in
exchange therefor.

     (c) Issuance and Transfer of Parent Common  Stock.  The  22,675,000  Parent
Shares to be issued by the Parent to the Company's shareholders pursuant to this
Agreement  constituting  approximately  seventy-five  point fifty eight per cent
(75.58%) of the total outstanding shares of the common stock of the Parent shall
be delivered by the Parent to Baker & Mackenzie LLP (the  "Exchange  Agent") and
shall be known as the "Merger Consideration."

     (d) Dissenting  Shares.  Notwithstanding  anything in this Agreement to the
contrary,  shares of Company  Common  Stock issued and  outstanding  immediately
prior to the Effective  Time of the Merger held by a holder (if any) who has the
right to demand  payment for and an appraisal  of such shares as provided  under
BVI law, if  applicable,  ("Dissenting  Shares")  shall not be converted  into a
right to receive  Merger  Consideration  unless such holder  fails to perfect or
otherwise  loses such holder's  right to such payment or appraisal,  if any. If,
after the  Effective  Time of the Merger,  such holder fails to perfect or loses
any such right to appraisal,  each such share of such holder shall be treated as
a share that had been  converted as of the Effective Time of the Merger into the
right to receive Merger  Consideration in accordance with this Section 2.01. The
Company  shall  give  prompt  notice to Parent of any  demands  received  by the
Company for appraisal of shares of Company  Common Stock,  and Parent shall have
the right to participate in all  negotiations  and  proceedings  with respect to

                                        3
<PAGE>

such demands.  The Company shall not,  except with the prior written  consent of
Parent, make any payment with respect to, or settle or offer to settle, any such
demands.

2.02 Stock  Warrants.  At the  Effective  Time of the  Merger,  there will be no
--------------------
outstanding warrants to purchase Parent Common Stock.

2.03 Exchange of Certificates.
-----------------------------

     (a) Exchange of  Certificates.  As soon as reasonably  practicable as of or
after  the  Effective  Time  of  the  Merger,  Parent  shall  issue  the  Merger
Consideration.

     (b) Settlement  Date. The settlement date as set forth herein shall be such
date which is six months from the  Effective  Time of the Merger and the date of
the resolution of any Contests further to Section 8.03 herein.

     (c) Exchange  Procedures.  At the Effective Time of the Merger, each holder
of an outstanding  certificate or certificates  which prior thereto  represented
shares of Company  Common Stock shall,  upon  surrender of such  certificate  or
certificates  and  acceptance  be  entitled  to a  certificate  or  certificates
representing  the  number  of  shares  of Parent  Common  Stock  into  which the
aggregate  number of shares of Company  Common Stock  previously  represented by
such certificate or certificates  surrendered shall have been converted pursuant
to this Agreement.  The Company shareholders shall accept such certificates upon
compliance  with such  reasonable  terms  and  conditions  to effect an  orderly
exchange  thereof in accordance  with normal exchange  practices.  All shares of
Company  Common Stock shall be  surrendered at the Effective Time of the Merger.
After the Effective  Time of the Merger,  there shall be no further  transfer on
the records of the Company or its transfer  agent of  certificates  representing
shares of Company Common Stock.  If any certificate for such Parent Common Stock
is to be issued in a name other than that in which the  certificate  for Company
Common Stock surrendered for exchange is registered,  it shall be a condition of
such exchange that the  certificate so surrendered  shall be properly  endorsed,
with signature guaranteed, or otherwise in proper form for transfer and that the
person  requesting  such exchange  shall pay to Parent or its transfer agent any
transfer  or other taxes or other  costs  required by reason of the  issuance of
certificates  for such  Parent  Common  Stock in a name  other  than that of the
registered  holder  of  the  certificate   surrendered,   or  establish  to  the
satisfaction of Parent or its transfer agent that all taxes have been paid.

     (d) No Further  Ownership  Rights in Company  Common  Stock.  All shares of
Parent  Common Stock  issued upon the  surrender  for  exchange of  certificates
representing shares of Company Common Stock in accordance with the terms of this
Article II shall be deemed to have been issued  (and paid) in full  satisfaction
of all  rights  pertaining  to the shares of Company  Common  Stock  theretofore
represented by such certificates.

     (e) No  Liability.  None of Parent,  Merger Sub,  or the  Company  shall be
liable to any  person in  respect  of any  shares  of  Parent  Common  Stock (or
dividends or distributions  with respect thereto) delivered to a public official
pursuant to any  applicable  abandoned  property,  escheat or similar  law.  All
certificates  representing  shares  of  Company  Common  Stock  shall  have been
surrendered at the Effective Time of the Merger.

                                        4
<PAGE>

                                  ARTICLE III:
                                  ------------
                         REPRESENTATIONS AND WARRANTIES

3.01  Representations and Warranties of the Company.  Except as set forth in the
---------------------------------------------------
Company  Disclosure  Schedule delivered by the Company to the Parent at the time
of execution of this  Agreement,  the Company  represents and warrants to Parent
and Merger Sub as follows:

     (a)  Organization,  Standing  and  Corporate  Power.  The  Company  is duly
organized,  validly  existing and in good standing under the laws of the British
Virgin Islands and has the requisite  corporate  power and authority to carry on
its business as now being  conducted.  The Company is duly qualified or licensed
to do business and is in good standing in each  jurisdiction in which the nature
of its  business  or the  ownership  or  leasing  of its  properties  makes such
qualification or licensing necessary, other than in such jurisdictions where the
failure to be so qualified or licensed  (individually or in the aggregate) would
not have a material adverse effect with respect to the Company.

     (b) Subsidiaries.  The Company owns 90.28% of its subsidiary, Xi'an Jialing
Real Estate Co. Ltd.  formed under the Company Law of the  People's  Republic of
China ("Jiahui").

     (c) Capital Structure. The authorized capital stock of the Company consists
of 50,000  shares of Company  Common  Stock.  There are 10,000  shares of Common
Stock  outstanding.  Except as set forth  above,  no shares of capital  stock or
other  equity  securities  of the Company are issued,  reserved  for issuance or
outstanding.  All  outstanding  shares of capital  stock of the Company are duly
authorized,  validly  issued,  fully paid and  nonassessable  and not subject to
preemptive rights.  There are no outstanding bonds,  debentures,  notes or other
indebtedness  or other  securities  of the Company  having the right to vote (or
convertible into, or exchangeable  for,  securities having the right to vote) on
any  matters  on  which  shareholders  of the  Company  may  vote.  The  Company
Disclosure  Schedule sets forth the outstanding  Capitalization  of the Company.
Except  as set  forth  above,  there  are no  outstanding  securities,  options,
warrants, calls, rights, commitments,  agreements,  arrangements or undertakings
of any kind to which the  Company is a party or by which it is bound  obligating
the Company to issue, deliver or sell, or cause to be issued, delivered or sold,
additional  shares of capital stock or other equity or voting  securities of the
Company or obligating the Company to issue, grant, extend or enter into any such
security,  option, warrant, call, right, commitment,  agreement,  arrangement or
undertaking.  Other than the Company Stock Options and Company  Warrants,  there
are no  outstanding  contractual  obligations,  commitments,  understandings  or
arrangements of the Company to repurchase,  redeem or otherwise  acquire or make
any payment in respect of any shares of capital stock of the Company.  There are
no  agreements  or  arrangements  pursuant  to which the  Company is or could be
required to register  shares of Company Common Stock or other  securities  under
the  Securities  Act of  1933,  as  amended  (the  "Securities  Act")  or  other
agreements  or  arrangements  with or among any security  holders of the Company
with respect to securities of the Company.

     (d) Authority;  Noncontravention.  The Company has the requisite  corporate
and other power and authority to enter into this Agreement and to consummate the
Merger.  The  execution  and  delivery of this  Agreement by the Company and the
consummation by the Company of the  transactions  contemplated  hereby have been

                                        5
<PAGE>

duly  authorized by all necessary  corporate  action on the part of the Company.
This  Agreement  has  been  duly  executed  and  delivered  by the  Company  and
constitutes a valid and binding obligation of the Company,  enforceable  against
the Company in  accordance  with its terms.  The  execution and delivery of this
Agreement do not, and the consummation of the transactions  contemplated by this
Agreement and compliance with the provisions  hereof will not, conflict with, or
result in any  breach or  violation  of, or default  (with or without  notice or
lapse  of  time,  or  both)  under,  or give  rise to a  right  of  termination,
cancellation or acceleration of or "put" right with respect to any obligation or
to loss of a material  benefit under, or result in the creation of any lien upon
any of the  properties  or assets of the  Company  under,  (i) the  Articles  of
Incorporation or Bylaws of the Company, (ii) any loan or credit agreement, note,
bond,  mortgage,  indenture,  lease  or  other  agreement,  instrument,  permit,
concession,  franchise or license  applicable to the Company,  its properties or
assets, or (iii) subject to the governmental  filings and other matters referred
to in the  following  sentence,  any  judgment,  order,  decree,  statute,  law,
ordinance,  rule, regulation or arbitration award applicable to the Company, its
properties  or assets.  No  consent,  approval,  order or  authorization  of, or
registration,  declaration  or filing with, or notice to, any federal,  state or
local  government  or any court,  administrative  agency or  commission or other
governmental  authority,  agency, domestic or foreign (a "Governmental Entity"),
is required by or with respect to the Company in  connection  with the execution
and delivery of this Agreement by the Company or the consummation by the Company
of the transactions contemplated hereby, except, with respect to this Agreement,
for the  filing  of the  Articles  of  Merger  with  the  Secretary  of State of
Colorado.

     (e) Absence of Certain  Changes or Events.  Since  December 31,  2003,  the
Company has conducted its business only in the ordinary  course  consistent with
past  practice,  and there is not and has not  been:  (i) any  material  adverse
change with  respect to the Company;  (ii) any  condition,  event or  occurrence
which  individually or in the aggregate  could  reasonably be expected to have a
material  adverse effect or give rise to a material  adverse change with respect
to the  Company;  (iii) any event  which,  if it had taken place  following  the
execution  of this  Agreement,  would not have been  permitted  by Section  4.01
without  prior  consent of Parent;  or (iv) any  condition,  event or occurrence
which could  reasonably be expected to prevent,  hinder or materially  delay the
ability of the  Company to  consummate  the  transactions  contemplated  by this
Agreement.

     (f) Litigation; Labor Matters; Compliance with Laws.

          (i) There is no suit,  action or proceeding or  investigation  pending
or, to the knowledge of the Company, threatened against or affecting the Company
or any  basis for any such  suit,  action,  proceeding  or  investigation  that,
individually  or in the  aggregate,  could  reasonably  be  expected  to  have a
material  adverse  effect  with  respect to the  Company or  prevent,  hinder or
materially  delay the  ability of the  Company to  consummate  the  transactions
contemplated by this Agreement, nor is there any judgment,  decree,  injunction,
rule or order of any Governmental  Entity or arbitrator  outstanding against the
Company  having,  or which,  insofar  as  reasonably  could be  foreseen  by the
Company, in the future could have, any such effect.

                                        6
<PAGE>

          (ii) The  Company  is not a party  to,  or bound  by,  any  collective
bargaining agreement,  contract or other agreement or understanding with a labor
union or labor organization,  nor is it the subject of any proceeding  asserting
that it has  committed  an unfair  labor  practice  or  seeking  to compel it to
bargain with any labor  organization as to wages or conditions of employment nor
is there any strike,  work stoppage or other labor dispute  involving it pending
or, to its  knowledge,  threatened,  any of which could have a material  adverse
effect with respect to the Company.

          (iii) The conduct of the  business of the  Company  complies  with all
statutes, laws, regulations,  ordinances,  rules, judgments,  orders, decrees or
arbitration awards applicable thereto.

     (g) Benefit Plans. The Company is not a party to any collective  bargaining
agreement  or  any  bonus,  pension,  profit  sharing,   deferred  compensation,
incentive  compensation,   stock  ownership,   stock  purchase,  phantom  stock,
retirement,  vacation,  severance,  disability, death benefit,  hospitalization,
medical or other  plan,  arrangement  or  understanding  (whether or not legally
binding) under which the Company currently has an obligation to provide benefits
to  any  current  or  former  employee,  officer  or  director  of  the  Company
(collectively, "Benefit Plans").

     (h) Certain Employee Payments. The Company is not a party to any employment
agreement  which could  result in the payment to any  current,  former or future
director or employee of the Company of any money or other  property or rights or
accelerate  or provide  any other  rights or  benefits  to any such  employee or
director as a result of the transactions contemplated by this Agreement, whether
or not (i) such payment, acceleration or provision would constitute a "parachute
payment"  (within the meaning of Section  280G of the Code),  or (ii) some other
subsequent action or event would be required to cause such payment, acceleration
or provision to be triggered.

     (i) Tax Returns  and Tax  Payments.  The  Company has timely  filed all Tax
Returns  required to be filed by it, has paid all Taxes shown  thereon to be due
and has provided  adequate  reserves in its financial  statements  for any Taxes
that have not been paid,  whether or not shown as being due on any  returns.  No
material  claim for  unpaid  Taxes has been  made or become a lien  against  the
property of the Company or is being  asserted  against the Company,  no audit of
any Tax Return of the  Company is being  conducted  by a tax  authority,  and no
extension of the statute of  limitations on the assessment of any Taxes has been
granted by the Company and is currently in effect. As used herein, "taxes" shall
mean all taxes of any kind, including,  without limitation, those on or measured
by or referred to as income, gross receipts, sales, use, ad valorem,  franchise,
profits, license,  withholding,  payroll, employment,  excise, severance, stamp,
occupation,  premium value added,  property or windfall profits taxes,  customs,
duties or similar fees,, assessments or charges of any kind whatsoever, together
with any interest and any  penalties,  additions  to tax or  additional  amounts
imposed by any governmental authority, domestic or foreign. As used herein, "Tax
Return" shall mean any return, report or statement required to be filed with any
governmental authority with respect to Taxes.

     (j) Environmental Matters. The Company is in compliance with all applicable
Environmental Laws. "Environmental Laws" means all applicable federal, state and

                                        7
<PAGE>

local statutes, rules, regulations,  ordinances,  orders, decrees and common law
relating in any manner to contamination, pollution or protection of human health
or the environment, and similar state laws.

     (k) Material Contract Defaults. The Company is not, or has not received any
notice or has any  knowledge  that any other party is, in default in any respect
under any Material Contract;  and there has not occurred any event that with the
lapse of time or the giving of notice or both would  constitute  such a material
default. For purposes of this Agreement, a Material Contract means any contract,
agreement  or  commitment  that is effective as of the Closing Date to which the
Company  is a party (i) with  expected  receipts  or  expenditures  in excess of
$100,000,  (ii)  requiring the Company to indemnify any person,  (iii)  granting
exclusive  rights to any party,  (iv)  evidencing  indebtedness  for borrowed or
loaned  money in  excess  of  $100,000  or more,  including  guarantees  of such
indebtedness,  or (v) which,  if breached by the Company in such a manner  would
(A)  permit  any other  party to cancel or  terminate  the same (with or without
notice of passage of time) or (B)  provide a basis for any other  party to claim
money  damages  (either  individually  or in the  aggregate  with all other such
claims  under  that  contract)  from the  Company or (C) give rise to a right of
acceleration  of any material  obligation or loss of any material  benefit under
any such contract, agreement or commitment.

     (l) Properties. The Company has good, clear and marketable title to all the
tangible properties and tangible assets reflected in the latest balance sheet as
being  owned by the  Company  or  acquired  after the date  thereof  which  are,
individually  or in the aggregate,  material to the Company's  business  (except
properties sold or otherwise  disposed of since the date thereof in the ordinary
course of business), free and clear of all material liens.

     (m) Trademarks and Related Contracts. To the knowledge of the Company:

          (i) As used in this Agreement, the term "Trademarks" means trademarks,
service marks, trade names, Internet domain names, designs, slogans, and general
intangibles of like nature;  the term "Trade  Secrets" means  technology;  trade
secrets and other confidential  information,  know-how,  proprietary  processes,
formulae,  algorithms,   models,  and  methodologies;   the  term  "Intellectual
Property" means patents,  copyrights,  Trademarks,  applications  for any of the
foregoing,  and Trade Secrets;  the term "Company License  Agreements" means any
license  agreements  granting  any right to use or practice any rights under any
Intellectual  Property  (except for such agreements for  off-the-shelf  products
that are generally available or less than $25,000),  and any written settlements
relating  to any  Intellectual  Property,  to which  the  Company  is a party or
otherwise bound;  and the term "Software"  means any and all computer  programs,
including  any  and all  software  implementations  of  algorithms,  models  and
methodologies, whether in source code or object code.

          (ii)  To  the  knowledge  of  the  Company,   none  of  the  Company's
Intellectual  Property or Company License Agreements infringe upon the rights of
any third  party  that may give rise to a cause of action or claim  against  the
Company or its successors.

     (n)  Board  Recommendation.  The  Board of  Directors  of the  Company  has
unanimously  determined that the terms of the Merger are fair to and in the best

                                        8
<PAGE>

interests of the shareholders of the Company and recommended that the holders of
the shares of Company Common Stock approve the Merger.

     (o) Required Company Vote. The affirmative vote of a majority of the shares
of each of the Company Common Stock is the only vote of the holders of any class
or series of the  Company's  securities  necessary  to approve  the Merger  (the
"Company Shareholder Approval").

3.02  Representations  and  Warranties  of  Jiahui.  Except  as set forth in the
--------------------------------------------------
Company  Disclosure  Schedule delivered by the Company to the Parent at the time
of execution of this  Agreement,  the Company  represents and warrants to Parent
and Merger Sub as follows:

     (a) Organization,  Standing and Corporate Power.  Jiahui is duly organized,
validly existing and in good standing under the laws of the People's Republic of
China  and has the  requisite  corporate  power  and  authority  to carry on its
business  as now being  conducted.  Jiahui is duly  qualified  or licensed to do
business and is in good standing in each jurisdiction in which the nature of its
business or the ownership or leasing of its properties makes such  qualification
or licensing necessary, other than in such jurisdictions where the failure to be
so qualified or licensed  (individually  or in the  aggregate)  would not have a
material adverse effect (as defined in Section 9.02) with respect to Jiahui.

     (b) Subsidiaries. Jiahui has no subsidiaries. Jiahui is 90.28% owned by the
Company and shall remain a majority owned subsidiary of the Company.

     (c) Capital Structure.  Except as set forth in the financial statements, no
shares  of  capital  stock or other  equity  securities  of Jiahui  are  issued,
reserved for issuance or outstanding.  All outstanding equity ownership interest
in Jiahui are duly authorized,  validly issued, fully paid and nonassessable and
not subject to preemptive rights.  There are no outstanding  bonds,  debentures,
notes or other  indebtedness  or other  securities of Jiahui having the right to
vote (or convertible into, or exchangeable  for,  securities having the right to
vote) on any  matters  on which  shareholders  of Jiahui  may vote.  The  Jiahui
Disclosure Schedule sets forth the outstanding  Capitalization of Jiahui. Except
as set forth above,  there are no  outstanding  securities,  options,  warrants,
calls, rights, commitments, agreements, arrangements or undertakings of any kind
to which Jiahui is a party or by which it is bound  obligating  Jiahui to issue,
deliver or sell, or cause to be issued,  delivered or sold, additional shares of
capital  stock or other  equity or  voting  securities  of Jiahui or  obligating
Jiahui to issue, grant, extend or enter into any such security, option, warrant,
call, right,  commitment,  agreement,  arrangement or undertaking.  There are no
outstanding contractual obligations, commitments, understandings or arrangements
of Jiahui to  repurchase,  redeem or  otherwise  acquire or make any  payment in
respect of any shares of capital  stock of Jiahui.  There are no  agreements  or
arrangements pursuant to which Jiahui is or could be required to register shares
of Company Common Stock or other securities under the Securities Act of 1933, as
amended (the "Securities Act") or other agreements or arrangements with or among
any security holders of Jiahui with respect to securities of Jiahui.

     (d)  Authority;  Noncontravention.  Jiahui has the requisite  corporate and
other  power  and  authority  to  enter  into  this  Agreement  and to make  the

                                        9
<PAGE>

representations  contained  herein.  This  Agreement  has been duly executed and
delivered by Jiahui and  constitutes  a valid and binding  obligation of Jiahui,
enforceable  against  Jiahui in  accordance  with its terms.  The  execution and
delivery of this  Agreement do not,  and the  consummation  of the  transactions
contemplated  by this Agreement and compliance  with the provisions  hereof will
not, conflict with, or result in any breach or violation of, or default (with or
without  notice  or lapse of time,  or both)  under,  or give rise to a right of
termination,  cancellation or acceleration of or "put" right with respect to any
obligation or to loss of a material  benefit under, or result in the creation of
any lien upon any of the properties or assets of Jiahui under,  (i) the Articles
of Incorporation or Bylaws of Jiahui,  (ii) any loan or credit agreement,  note,
bond,  mortgage,  indenture,  lease  or  other  agreement,  instrument,  permit,
concession, franchise or license applicable to Jiahui, its properties or assets,
or (iii) subject to the  governmental  filings and other matters  referred to in
the following sentence,  any judgment,  order, decree,  statute, law, ordinance,
rule,  regulation or arbitration  award applicable to Jiahui,  its properties or
assets.  No  consent,  approval,  order or  authorization  of, or  registration,
declaration or filing with, or notice to, any federal, state or local government
or  any  court,  administrative  agency  or  commission  or  other  governmental
authority, agency, domestic or foreign (a "Governmental Entity"), is required by
or with respect to Jiahui in connection  with the execution and delivery of this
Agreement  by  Jiahui  or  the   consummation  by  Jiahui  of  the  transactions
contemplated hereby,  except, with respect to this Agreement,  for the filing of
the Articles of Merger with the Secretary of State of Colorado.

     (e) Absence of Certain  Changes or Events.  Since December 31, 2003,  other
than the ownership  interest  transfer to the Company,  Jiahui has conducted its
business only in the ordinary course consistent with past practice, and there is
not and has not been:  (i) any material  adverse  change with respect to Jiahui;
(ii) any condition,  event or occurrence which  individually or in the aggregate
could reasonably be expected to have a material adverse effect or give rise to a
material adverse change with respect to Jiahui; (iii) any event which, if it had
taken place  following  the  execution  of this  Agreement,  would not have been
permitted  by  Section  4.01  without  prior  consent  of  Parent;  or (iv)  any
condition,  event or occurrence  which could  reasonably be expected to prevent,
hinder or materially  delay the ability of Jiahui to consummate the transactions
contemplated by this Agreement.

     (f) Litigation; Labor Matters; Compliance with Laws.

          (i) There is no suit,  action or proceeding or  investigation  pending
or, to the knowledge of Jiahui,  threatened  against or affecting  Jiahui or any
basis for any such suit, action,  proceeding or investigation that, individually
or in the  aggregate,  could  reasonably be expected to have a material  adverse
effect with respect to Jiahui or prevent, hinder or materially delay the ability
of Jiahui to consummate the transactions  contemplated by this Agreement, nor is
there any judgment, decree, injunction, rule or order of any Governmental Entity
or arbitrator outstanding against Jiahui having, or which, insofar as reasonably
could be foreseen by Jiahui, in the future could have, any such effect.

          (ii) Jiahui is not a party to, or bound by, any collective  bargaining
agreement,  contract or other agreement or  understanding  with a labor union or
labor  organization,  nor is it the subject of any proceeding  asserting that it
has  committed an unfair labor  practice or seeking to compel it to bargain with
any labor  organization as to wages or conditions of employment nor is there any

                                       10
<PAGE>

strike,  work  stoppage or other labor  dispute  involving it pending or, to its
knowledge,  threatened,  any of which could have a material  adverse effect with
respect to Jiahui.

          (iii)  The  conduct  of the  business  of  Jiahui  complies  with  all
statutes, laws, regulations,  ordinances,  rules, judgments,  orders, decrees or
arbitration awards applicable thereto.

     (g)  Benefit  Plans.  Jiahui  is not a party to any  collective  bargaining
agreement  or  any  bonus,  pension,  profit  sharing,   deferred  compensation,
incentive  compensation,   stock  ownership,   stock  purchase,  phantom  stock,
retirement,  vacation,  severance,  disability, death benefit,  hospitalization,
medical or other  plan,  arrangement  or  understanding  (whether or not legally
binding) under which Jiahui  currently has an obligation to provide  benefits to
any current or former  employee,  officer or  director of Jiahui  (collectively,
"Benefit Plans").

     (h)  Certain  Employee  Payments.  Jiahui is not a party to any  employment
agreement  which could  result in the payment to any  current,  former or future
director  or  employee  of Jiahui of any  money or other  property  or rights or
accelerate  or provide  any other  rights or  benefits  to any such  employee or
director as a result of the transactions contemplated by this Agreement, whether
or not (i) such payment, acceleration or provision would constitute a "parachute
payment"  (within the meaning of Section  280G of the Code),  or (ii) some other
subsequent action or event would be required to cause such payment, acceleration
or provision to be triggered.

     (i) Tax Returns and Tax  Payments.  Jiahui has timely filed all Tax Returns
required to be filed by it, has paid all Taxes  shown  thereon to be due and has
provided adequate  reserves in its financial  statements for any Taxes that have
not been paid,  whether or not shown as being due on any  returns.  No  material
claim for unpaid  Taxes has been made or become a lien  against the  property of
Jiahui or is being asserted against Jiahui, no audit of any Tax Return of Jiahui
is being  conducted  by a tax  authority,  and no  extension  of the  statute of
limitations  on the  assessment  of any Taxes has been  granted by Jiahui and is
currently in effect.  As used herein,  "taxes" shall mean all taxes of any kind,
including, without limitation, those on or measured by or referred to as income,
gross  receipts,   sales,  use,  ad  valorem,   franchise,   profits,   license,
withholding,  payroll, employment, excise, severance, stamp, occupation, premium
value added,  property or windfall  profits  taxes,  customs,  duties or similar
fees,, assessments or charges of any kind whatsoever, together with any interest
and  any  penalties,  additions  to tax or  additional  amounts  imposed  by any
governmental authority,  domestic or foreign. As used herein, "Tax Return" shall
mean any return,  report or statement required to be filed with any governmental
authority with respect to Taxes.

     (j)  Environmental  Matters.  Jiahui  is in  material  compliance  with all
applicable  Environmental  Laws.   "Environmental  Laws"  means  all  applicable
federal,  state and local  statutes,  rules,  regulations,  ordinances,  orders,
decrees and common law  relating in any manner to  contamination,  pollution  or
protection of human health or the environment, and similar state laws.

                                       11
<PAGE>

     (k)  Material  Contract  Defaults.  Jiahui is not, or has not  received any
notice or has any  knowledge  that any other party is, in default in any respect
under any Material Contract;  and there has not occurred any event that with the
lapse of time or the giving of notice or both would  constitute  such a material
default. For purposes of this Agreement, a Material Contract means any contract,
agreement or commitment that is effective as of the Closing Date to which Jiahui
is a party (i) with  expected  receipts or  expenditures  in excess of $100,000,
(ii) requiring Jiahui to indemnify any person,  (iii) granting  exclusive rights
to any party,  (iv)  evidencing  indebtedness  for  borrowed or loaned  money in
excess of $100,000 or more,  including  guarantees of such indebtedness,  or (v)
which,  if breached by Jiahui in such a manner  would (A) permit any other party
to cancel or terminate  the same (with or without  notice of passage of time) or
(B)  provide  a basis  for any  other  party  to  claim  money  damages  (either
individually or in the aggregate with all other such claims under that contract)
from  Jiahui  or (C)  give  rise  to a right  of  acceleration  of any  material
obligation or loss of any material benefit under any such contract, agreement or
commitment.

     (l)  Properties.  Jiahui has good,  clear and  marketable  title to all the
tangible properties and tangible assets reflected in the latest balance sheet as
being owned by Jiahui or acquired after the date thereof which are, individually
or in the aggregate,  material to Jiahui's  business (except  properties sold or
otherwise  disposed  of  since  the  date  thereof  in the  ordinary  course  of
business), free and clear of all material liens.

     (m) Trademarks and Related Contracts. To the knowledge of Jiahui:

          (i) As used in this Agreement, the term "Trademarks" means trademarks,
service marks, trade names, Internet domain names, designs, slogans, and general
intangibles of like nature;  the term "Trade  Secrets" means  technology;  trade
secrets and other confidential  information,  know-how,  proprietary  processes,
formulae,  algorithms,   models,  and  methodologies;   the  term  "Intellectual
Property" means patents,  copyrights,  Trademarks,  applications  for any of the
foregoing,  and Trade Secrets;  the term "Company License  Agreements" means any
license  agreements  granting  any right to use or practice any rights under any
Intellectual  Property  (except for such agreements for  off-the-shelf  products
that are generally available or less than $25,000),  and any written settlements
relating to any Intellectual  Property,  to which Jiahui is a party or otherwise
bound;  and the term "Software" means any and all computer  programs,  including
any and all software  implementations  of algorithms,  models and methodologies,
whether in source code or object code.

          (ii)  To the  knowledge  of  Jiahui,  none  of  Jiahui's  Intellectual
Property or Company License  Agreements  infringe  materially upon the rights of
any third party that may give rise to a cause of action or claim against  Jiahui
or its successors.

3.03  Representations  and  Warranties  of Parent and Merger Sub.  Except as set
----------------------------------------------------------------
forth in the disclosure  schedule delivered by Parent to the Company at the time
of execution of this Agreement (the "Parent  Disclosure  Schedule"),  Parent and
Merger Sub represent and warrant to the Company as follows:

                                       12
<PAGE>

     (a) Organization,  Standing and Corporate Power. Each of Parent, Merger Sub
and the other  Parent  Subsidiaries  (as  defined in Section  3.02(b)) is (or at
Closing will be) duly organized, validly existing and in good standing under the
laws of the State of Colorado, as is applicable, and has the requisite corporate
power and  authority  to carry on its business as now being  conducted.  Each of
Parent,  Merger  Sub and the other  Parent  Subsidiaries  is duly  qualified  or
licensed to do business and is in good  standing in each  jurisdiction  in which
the nature of its business or the ownership or leasing of its  properties  makes
such  qualification  or licensing  necessary,  other than in such  jurisdictions
where  the  failure  to be so  qualified  or  licensed  (individually  or in the
aggregate) would not have a material adverse effect with respect to Parent.

     (b)  Subsidiaries.  In addition  to the Merger Sub,  the Parent has another
subsidiary Bangla Properties Inc. formed in the Province of Saskatchewan, Canada
(the  "Canada  Subsidiary")  to pursue its business  plans and to obtain  rental
properties and contracts. All the outstanding shares of capital stock of each of
the Parent's  subsidiary which is a corporation have been validly issued and are
fully paid and  nonassessable  and, except as set forth in the Parent Disclosure
Schedule,  are owned (of record and  beneficially) by Parent,  free and clear of
all  Liens.  Except  for  the  capital  stock  of its  subsidiaries,  which  are
corporations,  Parent does not own, directly or indirectly, any capital stock or
other ownership interest in any corporation,  partnership, business association,
joint  venture  or  other  entity.  Parent  hereby  irrevocably  covenants  that
immediately  after the Merger,  Parent shall spin off the Canada Subsidiary in a
private sale with all the  liabilities  of the Canada  Subsidiary to be borne by
the purchaser.

     (c) Capital  Structure.  The authorized capital stock of Parent consists of
100,000,000  shares of Parent Common  Stock,  no par value,  of which  7,325,000
shares of Parent Common Stock are issued and outstanding and no shares of Parent
Common Stock are issuable upon the exercise of outstanding warrants, convertible
notes,  options and otherwise.  Except as set forth above,  no shares of capital
stock or other equity securities of Parent are issued,  reserved for issuance or
outstanding.  All  outstanding  shares of capital  stock of Parent are,  and all
shares which may be issued pursuant to this Agreement will be, when issued, duly
authorized,  validly  issued,  fully  paid and  nonassessable,  not  subject  to
preemptive  rights,  and  issued in  compliance  with all  applicable  state and
federal laws  concerning  the issuance of  securities.  There are no outstanding
bonds,  debentures,  notes or other  indebtedness or other  securities of Parent
having the right to vote (or convertible into, or exchangeable  for,  securities
having  the right to vote) on any  matters on which  shareholders  of Parent may
vote. Except as set forth above, there are no outstanding  securities,  options,
warrants, calls, rights, commitments,  agreements,  arrangements or undertakings
of any kind to which  Parent or any of its  subsidiaries  is a party or by which
any of them is bound obligating Parent or any its subsidiaries to issue, deliver
or sell, or cause to be issued,  delivered or sold, additional shares of capital
stock or  other  equity  securities  of  Parent  or any of its  subsidiaries  or
obligating Parent or any of its subsidiaries to issue, deliver or sell, or cause
to be issued,  delivered or sold,  additional  shares of capital  stock or other
equity  securities of Parent or any of its subsidiaries or obligating  Parent or
any of its subsidiaries to issue, grant, extend or enter into any such security,
option, warrant, call, right, commitment, agreement, arrangement or undertaking.
There are no outstanding contractual obligations, commitments, understandings or
arrangements  of  Parent or any of its  subsidiaries  to  repurchase,  redeem or
otherwise  acquire or make any payment in respect of any shares of capital stock
of Parent or any of its subsidiaries. The authorized capital stock of Merger Sub

                                       13
<PAGE>

consists of 1,000  shares of common  stock (of which 900 shares are owned by the
Parent and 100 shares  owned by the  Company),  par value  $0.001 per share,  of
which 1,000 shares have been validly issued,  are fully paid and  nonassessable,
were issued in compliance with all applicable  state and federal laws concerning
the issuance of securities, and are owned by Parent, free and clear of any lien.

     (d) Authority;  Noncontravention.  Parent and Merger Sub have all requisite
corporate  authority  to  enter  into  this  Agreement  and  to  consummate  the
transactions  contemplated by this Agreement. The execution and delivery of this
Agreement by Parent and Merger Sub and the consummation by Parent and Merger Sub
of the transactions contemplated by this Agreement have been (or at Closing will
have been) duly  authorized  by all  necessary  corporate  action on the part of
Parent and Merger Sub.  This  Agreement  has been duly executed and delivered by
and constitutes a valid and binding obligation of each of Parent and Merger Sub,
enforceable  against each such party in accordance with its terms. The execution
and delivery of this agreement do not, and the  consummation of the transactions
contemplated  by this  Agreement  and  compliance  with the  provisions  of this
Agreement  will not,  conflict with, or result in any breach or violation of, or
default (with or without  notice or lapse of time, or both) under,  or give rise
to a right of  termination,  cancellation or acceleration of or "put" right with
respect to any obligation or to loss of a material  benefit under,  or result in
the creation of any lien upon any of the  properties  or assets of Parent or any
of its subsidiaries under, (i) the articles of incorporation or bylaws of Parent
or Merger Sub or the comparable charter or organizational documents of any other
subsidiary of Parent, (ii) any loan or credit agreement,  note, bond,  mortgage,
indenture, lease or other agreement,  instrument, permit, concession,  franchise
or license applicable to Parent, Merger Sub or any other subsidiary of Parent or
their  respective  properties or assets,  or (iii)  subject to the  governmental
filings and other matters referred to in the following  sentence,  any judgment,
order, decree,  statute,  law, ordinance,  rule, regulation or arbitration award
applicable  to  Parent,  Merger Sub or any other  subsidiary  of Parent or their
respective  properties  or assets,  other than,  in the case of clauses (ii) and
(iii), any such conflicts,  breaches,  violations,  defaults,  rights, losses or
liens that  individually or in the aggregate  could not have a material  adverse
effect with respect to Parent or could not prevent,  hinder or materially  delay
the  ability  of Parent to  consummate  the  transactions  contemplated  by this
Agreement.  No consent,  approval,  order or authorization  of, or registration,
declaration or filing with, or notice to, any Governmental Entity is required by
or with  respect to  Parent,  Merger  Sub or any other  subsidiary  of Parent in
connection with the execution and delivery of this Agreement by Parent or Merger
Sub or the  consummation  by Parent or Merger Sub, as the case may be, of any of
the  transactions  contemplated by this Agreement,  except for the filing of the
Articles of Merger with the Secretaries of State of Colorado,  as required,  and
such  other  consents,   approvals,   orders,   authorizations,   registrations,
declarations, states.

     (e) SEC Documents;  Undisclosed Liabilities.  Parent has filed all reports,
schedules,  forms,  statements and other documents as required by the Securities
and Exchange  Commission  (the "SEC") and Parent has delivered or made available
to the Company all reports,  schedules,  forms,  statements and other  documents
filed with the SEC  (collectively,  and in each case  including all exhibits and
schedules thereto and documents  incorporated by reference therein,  the "Parent
SEC Documents"). As of their respective dates, the Parent SEC Documents complied
in all material  respects with the  requirements  of the  Securities  Act or the
Securities  Exchange  Act of  1934,  as the  case  may  be,  and the  rules  and

                                       14
<PAGE>

regulations  of the SEC  promulgated  thereunder  applicable  to such Parent SEC
documents,  and  none  of the  Parent  SEC  Documents  (including  any  and  all
consolidated  financial  statements  included therein) as of such date contained
any  untrue  statement  of a material  fact or 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.  Except to the extent  revised or superseded by a subsequent  filing
with the SEC (a copy of which has been provided to the Company prior to the date
of this  Agreement),  none of the  Parent SEC  Documents,  to the  knowledge  of
Parent's  management,  contains any untrue statement of a material fact or omits
to state any material  fact or 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.  The consolidated
financial  statements of Parent included in such Parent SEC Documents  comply as
to form in all material respects with applicable accounting requirements and the
published  rules and  regulations  of the SEC with  respect  thereto,  have been
prepared in accordance with generally accepted accounting principles (except, in
the case of unaudited  consolidated  quarterly statements,  as permitted by Form
10-Q of the SEC)  applied on a  consistent  basis  during the  periods  involved
(except  as may be  indicated  in the notes  thereto)  and  fairly  present  the
consolidated  financial position of Parent and its consolidated  subsidiaries as
of the dates thereof and the  consolidated  results of operations and changes in
cash  flows  for the  periods  then  ended  (subject,  in the case of  unaudited
quarterly  statements,  to normal  year-end  audit  adjustments as determined by
Parent's  independent  accountants).  Except  as set  forth  in the  Parent  SEC
Documents, at the date of the most recent audited financial statements of Parent
included in the Parent SEC Documents, neither Parent nor any of its subsidiaries
had,  and since  such  date  neither  Parent  nor any of such  subsidiaries  has
incurred,  any  liabilities  or  obligations  of any  nature  (whether  accrued,
absolute,  contingent or otherwise)  which,  individually  or in the  aggregate,
could  reasonably be expected to have a material  adverse effect with respect to
Parent.

     (f) Absence of Certain Changes or Events. Except as disclosed in the Parent
SEC Documents,  since the date of the most recent financial  statements included
in the Parent SEC  Documents,  Parent has  conducted  its  business  only in the
ordinary course  consistent with past practice in light of its current  business
circumstances,  and  there is not and has not  been:  (i) any  material  adverse
change with respect to Parent;  (ii) any condition,  event or occurrence  which,
individually  or in the  aggregate,  could  reasonably  be  expected  to  have a
material  adverse effect or give rise to a material  adverse change with respect
to Parent;  (iii) any event which, if it had taken place following the execution
of this  Agreement,  would not have been  permitted  by Section 4.01 without the
prior consent of the Company;  or (iv) any condition,  event or occurrence which
could reasonably be expected to prevent,  hinder or materially delay the ability
of Parent to consummate the transactions contemplated by this Agreement.

     (g)  Interim  Operations  of Merger  Sub.  The Merger Sub was formed in the
State of  Colorado  solely  for the  purpose  of  engaging  in the  transactions
contemplated  hereby and has engaged in no other business activities and has (or
will have) conducted its operations only as contemplated hereby.

     (h) Litigation; Labor Matters; Compliance with Laws.

          (i) There is no suit,  action or proceeding or  investigation  pending
or, to the knowledge of Parent,  threatened  against or affecting  Parent or any

                                       15
<PAGE>

basis for any such suit, action,  proceeding or investigation that, individually
or in the  aggregate,  could  reasonably be expected to have a material  adverse
effect with respect to Parent or prevent, hinder or materially delay the ability
of Parent to consummate the transactions  contemplated by this Agreement, nor is
there any judgment, decree, injunction, rule or order of any Governmental Entity
or arbitrator outstanding against Parent having, or which, insofar as reasonably
could be foreseen by Parent, in the future could have, any such effect.

          (ii) Parent is not a party to, or bound by, any collective  bargaining
agreement,  contract or other agreement or  understanding  with a labor union or
labor  organization,  nor is it the subject of any proceeding  asserting that it
has  committed an unfair labor  practice or seeking to compel it to bargain with
any labor  organization as to wages or conditions of employment nor is there any
strike,  work  stoppage or other labor  dispute  involving it pending or, to its
knowledge,  threatened,  any of which could have a material  adverse effect with
respect to Parent.

          (iii)  The  conduct  of the  business  of  Parent  complies  with  all
statutes, laws, regulations,  ordinances,  rules, judgments,  orders, decrees or
arbitration awards applicable thereto.

     (i) Benefit  Plans.  Parent is not a party to any Benefit  Plan under which
Parent  currently has an obligation to provide benefits to any current or former
employee, officer or director of Parent.

     (j)  Certain  Employee  Payments.  Parent is not a party to any  employment
agreement  which could  result in the payment to any  current,  former or future
director  or  employee  of Parent of any  money or other  property  or rights or
accelerate  or provide  any other  rights or  benefits  to any such  employee or
director as a result of the transactions contemplated by this Agreement, whether
or not (i) such payment, acceleration or provision would constitute a "parachute
payment"  (within the meaning of Section  280G of the Code),  or (ii) some other
subsequent action or event would be required to cause such payment, acceleration
or provision to be triggered.

     (k) Tax Returns and Tax  Payments.  Parent has timely filed all Tax Returns
required to be filed by it, has paid all Taxes  shown  thereon to be due and has
provided adequate  reserves in its financial  statements for any Taxes that have
not been paid,  whether or not shown as being due on any  returns.  No  material
claim for unpaid  Taxes has been made or become a lien  against the  property of
Parent or is being asserted against Parent, no audit of any Tax Return of Parent
is being  conducted  by a tax  authority,  and no  extension  of the  statute of
limitations  on the  assessment  of any Taxes has been  granted by Parent and is
currently in effect.

     (l)  Environmental  Matters.  Parent  is in  material  compliance  with all
applicable Environmental Laws.

     (m) Material  Contract  Defaults.  Parent is not, or has not,  received any
notice or has any  knowledge  that any other party is, in default in any respect
under any Material Contract;  and there has not occurred any event that with the
lapse of time or the giving of notice or both would  constitute  such a material
default. For purposes of this Agreement, a Material Contract means any contract,
agreement or commitment that is effective as of the Closing Date to which Parent

                                       16
<PAGE>

is a party (i) with expected receipts or expenditures in excess of $10,000, (ii)
requiring Parent to indemnify any person, (iii) granting exclusive rights to any
party,  (iv) evidencing  indebtedness  for borrowed or loaned money in excess of
$10,000 or more,  including  guarantees of such  indebtedness,  or (v) which, if
breached  by Parent in such a manner  would (A) permit any other party to cancel
or terminate the same (with or without notice of passage of time) or (B) provide
a basis for any other party to claim money damages  (either  individually  or in
the aggregate with all other such claims under that contract) from Parent or (C)
give rise to a right of acceleration  of any material  obligation or loss of any
material benefit under any such contract, agreement or commitment.

     (n)  Properties.  Parent has good,  clear and  marketable  title to all the
tangible properties and tangible assets reflected in the latest balance sheet as
being owned by Parent or acquired after the date thereof which are, individually
or in the aggregate,  material to Parent's  business (except  properties sold or
otherwise  disposed  of  since  the  date  thereof  in the  ordinary  course  of
business), free and clear of all material liens.

     (o) Trademarks and Related Contracts.  Parent does not hold any Trademarks,
Trade  Secrets,  or  Intellectual  Property,  and is not  party  to any  license
agreements regarding such.

     (p) Board Recommendation.  The Board of Directors of Parent has unanimously
determined that the terms of the Merger are fair to and in the best interests of
the shareholders of Parent.

                                   ARTICLE IV:
                                   -----------
                              COVENANTS RELATING TO
                  CONDUCT OF BUSINESS PRIOR TO AND POST MERGER

4.01 Conduct of Company and Parent.  From the date of this  Agreement  and until
----------------------------------
the  Effective  Time of the  Merger,  or until  the  prior  termination  of this
Agreement, Company and Parent shall not, unless mutually agreed to in writing:

     (a) engage in any transaction,  except in the normal and ordinary course of
business, or create or suffer to exist any Lien or other encumbrance upon any of
their  respective  assets or which will not be  discharged  in full prior to the
Effective Time of the Merger;

     (b) sell,  assign or otherwise  transfer any of their assets,  or cancel or
compromise  any debts or claims  relating to their  assets,  other than for fair
value, in the ordinary course of business, and consistent with past practice;

     (c)  fail to use  reasonable  efforts  to  preserve  intact  their  present
business  organizations,  keep  available  the services of their  employees  and
preserve  its  material  relationships  with  customers,  suppliers,  licensors,
licensees,  distributors and others,  to the end that its good will and on-going
business not be impaired prior to the Effective Time of the Merger;

     (d) except for matters related to complaints by former employees related to
wages,  suffer or permit any  material  adverse  change to occur with respect to
Company and Parent or their business or assets; or

                                       17
<PAGE>

     (e) make any material  change with respect to their  business in accounting
or bookkeeping methods, principles or practices, except as required by GAAP.

                                   ARTICLE V:
                                   ----------
                              ADDITIONAL AGREEMENTS

5.01 Access to Information; Confidentiality.
-------------------------------------------

     (a) The Company shall,  and shall cause its officers,  employees,  counsel,
financial  advisors  and other  representatives  to,  afford  to Parent  and its
representatives reasonable access during normal business hours during the period
prior to the  Effective  Time of the Merger to its and to  Jiahui's  properties,
books,  contracts,  commitments,  personnel and records and, during such period,
the Company  shall,  and shall cause its and Jiahui's  officers,  employees  and
representatives to, furnish promptly to Parent all information  concerning their
respective business, properties,  financial condition,  operations and personnel
as such other party may from time to time reasonably  request.  For the purposes
of determining the accuracy of the  representations and warranties of the Parent
and Merger Sub set forth herein and  compliance  by the Parent and Merger Sub of
their respective obligations hereunder, during the period prior to the Effective
Time of the Merger,  Parent  shall  provide the Company and its  representatives
with  reasonable  access  during normal  business  hours to its and Merger Sub's
properties,  books,  contracts,  commitments,  personnel  and  records as may be
necessary to enable the Company to confirm the  accuracy of the  representations
and  warranties  of Parent  and Merger Sub set forth  herein and  compliance  by
Parent and Merger Sub of their obligations  hereunder,  and, during such period,
Parent  shall,  and  shall  cause  its  subsidiaries,  officers,  employees  and
representatives  to, furnish promptly to the Company upon its request (i) a copy
of each report, schedule,  registration statement and other document filed by it
during such period pursuant to the  requirements of federal or state  securities
laws  and  (ii) all  other  information  concerning  its  business,  properties,
financial condition,  operations and personnel as such other party may from time
to time  reasonably  request.  Except as required by law,  each of the  Company,
Merger  Sub,  and Parent  will hold,  and will cause its  respective  directors,
officers,  employees,   accountants,   counsel,  financial  advisors  and  other
representatives and affiliates to hold, any nonpublic information in confidence.

     (b) No  investigation  pursuant  to this  Section  5.01  shall  affect  any
representations  or  warranties of the parties  herein or the  conditions to the
obligations of the parties hereto.

5.02 Best  Efforts.  Upon the terms and subject to the  conditions  set forth in
------------------
this  Agreement,  each of the parties agrees to use its best efforts to take, or
cause to be taken,  all actions,  and to do, or cause to be done,  and to assist
and cooperate with the other parties in doing, all things  necessary,  proper or
advisable to  consummate  and make  effective,  in the most  expeditious  manner
practicable,  the  Merger  and  the  other  transactions  contemplated  by  this
Agreement.  Parent,  Merger Sub and the Company  will use their best efforts and
cooperate with one another (i) in promptly  determining  whether any filings are
required to be made or consents,  approvals,  waivers, permits or authorizations
are required to be obtained (or, which if not obtained, would result in an event

                                       18
<PAGE>

of default,  termination or acceleration of any agreement or any put right under
any agreement)  under any applicable law or regulation or from any  governmental
authorities or third parties, including parties to loan agreements or other debt
instruments  and  including  such  consents,   approvals,  waivers,  permits  or
authorizations as may be required to transfer the assets and related liabilities
of the  Company to the  Merger  Sub in  promptly  making  any such  filings,  in
furnishing information required in connection therewith and in timely seeking to
obtain  any such  consents,  approvals,  permits or  authorizations  and (ii) in
facilitating each other's due diligence  investigations.  Parent and the Company
shall mutually  cooperate in order to facilitate the achievement of the benefits
reasonably anticipated from the Merger.

5.03  Public  Announcements.  Parent and Merger  Sub,  on the one hand,  and the
---------------------------
Company,  on the other hand,  will consult with each other before  issuing,  and
provide each other the opportunity to review and comment upon, any press release
or other public statements with respect to the transactions contemplated by this
Agreement  and shall not issue any such press  release  or make any such  public
statement  prior to such  consultation,  except as may be required by applicable
law or court  process.  The  parties  agree that the  initial  press  release or
releases  to be issued with  respect to the  transactions  contemplated  by this
Agreement  shall  be  mutually  agreed  upon  prior  to  the  issuance  thereof.
Notwithstanding  the foregoing,  Company may disclose the contemplated Merger in
letters to the  Company's  optionees  for purposes of  fulfilling  the Company's
obligations under the Company Option Plan to the said optionees.

5.04 Expenses. All costs and expenses incurred in connection with this Agreement
-------------
and the  transactions  contemplated  hereby shall be paid by the party incurring
such expenses.

5.05 Directors and Officers. Upon the Effective Time of the Merger, all officers
---------------------------
of the Parent other than the sole director  shall have resigned and Parent shall
have taken all action to cause  Ping'an Wu to be elected as the  Chairman of its
Board of Directors and its officers to consist of the  following:  Ping'an Wu as
the Chief Executive  Officer,  Shuo (Steven) Lou as the Chief Financial Officer,
Yingming  Wang  as  the  Chief  Operation  Officer,  and  Xingguo  Wang  as  the
Independent Director of the Parent.

5.06 No  Solicitation.  Except as  previously  agreed to in writing by the other
---------------------
party,  neither Company or Parent shall authorize or permit any of its officers,
directors,  agents,  representatives,  or advisors to (a)  solicit,  initiate or
encourage  or take  any  action  to  facilitate  the  submission  of  inquiries,
proposals  or offers  from any  person  relating  to any matter  concerning  any
merger,  consolidation,   business  combination,   recapitalization  or  similar
transaction   involving  Company  or  Parent,   respectively,   other  than  the
transaction  contemplated  by  this  Agreement  or  any  other  transaction  the
consummation of which would or could reasonably be expected to impede, interfere
with,  prevent or delay the Merger or which would or could be expected to dilute
the benefits to the Company of the transactions  contemplated hereby. Company or
Parent  will  immediately   cease  and  cause  to  be  terminated  any  existing
activities,  discussions and negotiations with any parties conducted  heretofore
with respect to any of the foregoing.

                                   ARTICLE VI:
                                   -----------
                              CONDITIONS PRECEDENT

                                       19
<PAGE>

6.01 Conditions to Each Party's  Obligation to Effect the Merger. The respective
----------------------------------------------------------------
obligation of each party to effect the Merger is subject to the  satisfaction or
waiver on or prior to the Closing Date of the following conditions:

     (a) Opinions of Counsel.  Execution and delivery of the  following:  (i) to
the Company,  an opinion of counsel from Parent's  legal counsel that the terms,
conditions  and  structure  of this Merger  satisfy  Colorado  law;  (ii) to the
Parent,  an opinion of counsel from the Company's  legal counsel that the terms,
conditions and structure of this Merger satisfy  British Virgin Islands law; and
(iii) to the Parent,  an opinion of counsel from Jiahui's legal counsel that the
terms,  conditions and structure of this Merger satisfy the People's Republic of
China law.

     (b)  No  Injunctions  or  Restraints.   No  temporary   restraining  order,
preliminary  or  permanent  injunction  or other  order  issued  by any court of
competent  jurisdiction or other legal  restraint or prohibition  preventing the
consummation of the Merger shall be in effect.

     (c) No  Dissent.  Holders of no more than five  percent  (5%) of the Merger
Sub's Common Stock shall have dissented to the Merger.

6.02  Conditions to  Obligations  of Parent and Merger Sub. The  obligations  of
----------------------------------------------------------
Parent and Merger Sub to effect the Merger are further  subject to the following
conditions:

     (a) Representations  and Warranties.  The representations and warranties of
the  Company  set  forth in this  Agreement  shall be true  and  correct  in all
material  respects,  in each case as of the date of this Agreement and as of the
Closing  Date as though made on and as of the Closing  Date.  Parent  shall have
received a  certificate  signed on behalf of the Company by the president of the
Company to such effect.

     (b)  Performance  of  Obligations  of the Company.  The Company  shall have
performed the obligations required to be performed by it under this Agreement at
or prior to the Closing  Date  (except for such  failures to perform as have not
had  or  could  not  reasonably  be  expected,  either  individually  or in  the
aggregate,  to have a material  adverse  effect  with  respect to the Company or
adversely  affect the  ability of the  Company to  consummate  the  transactions
herein contemplated or perform its obligations hereunder), and Parent shall have
received a  certificate  signed on behalf of the Company by the president of the
Company to such effect.

     (c)  Consents,  etc.  Parent  shall  have  received  evidence,  in form and
substance reasonably satisfactory to it, that such licenses,  permits, consents,
approvals, authorizations, qualifications and orders of governmental authorities
and other  third  parties  as  necessary  in  connection  with the  transactions
contemplated hereby have been obtained.

     (d)  No  Litigation.  There  shall  not be  pending  or  threatened  by any
Governmental  Entity any suit,  action or proceeding (or by any other person any
suit,  action or proceeding which has a reasonable  likelihood of success),  (i)
challenging or seeking to restrain or prohibit the consummation of the Merger or
any of the other  transactions  contemplated  by this  Agreement  or  seeking to
obtain from Parent or any of its  subsidiaries  any damages that are material in
relation  to Parent  and its  subsidiaries  taken as a whole,  (ii)  seeking  to

                                       20
<PAGE>

prohibit or limit the  ownership or  operation by the Company,  Parent or any of
its  subsidiaries  of any  material  portion  of the  business  or assets of the
Company,  Parent or any of its  subsidiaries,  or to dispose of or hold separate
any material portion of the business or assets of the Company,  Parent or any of
its  subsidiaries,  as a result of the  Merger or any of the other  transactions
contemplated  by this  Agreement,  (iii)  seeking to impose  limitations  on the
ability of Parent or Merger Sub to acquire or hold,  or exercise  full rights of
ownership  of,  any  shares  of  Company  Common  Stock or  Common  Stock of the
Surviving  Corporation,  including,  without  limitation,  the right to vote the
Company Common Stock or Common Stock of the Surviving Corporation on all matters
properly  presented  to  the  shareholders  of  the  Company  or  the  Surviving
Corporation,  respectively,  or (iv)  seeking to  prohibit  Parent or any of its
subsidiaries  from effectively  controlling in any material respect the business
or operations of the Company.

     (e) Due Diligence Investigation. Parent shall be satisfied with the results
of its due  diligence  investigation  of the  Company and Jiahui in its sole and
absolute discretion.

6.03  Conditions to Obligation of the Company.  The obligation of the Company to
---------------------------------------------
effect the Merger is further subject to the following conditions:

     (a) Representations  and Warranties.  The representations and warranties of
Parent and Merger Sub set forth in this  Agreement  shall be true and correct in
all material  respects,  in each case as of the date of this Agreement and as of
the Closing Date as though made on and as of the Closing Date. The Company shall
have  received  a  certificate  signed on behalf of Parent by the  president  of
Parent to such effect.

     (b)  Performance of Obligations of Parent and Merger Sub. Parent and Merger
Sub shall have performed the obligations  required to be performed by them under
this  Agreement  at or prior to the Closing  Date  (except for such  failures to
perform as have not had or could not reasonably be expected, either individually
or in the aggregate, to have a material adverse effect with respect to Parent or
adversely  affect the ability of Parent to consummate  the  transactions  herein
contemplated or perform its obligations  hereunder),  and the Company shall have
received a certificate  signed on behalf of Parent by the president of Parent to
such effect.

     (c) No  Litigation.  There  shall not be  pending or  threatened  any suit,
action or  proceeding  before any court,  Governmental  Entity or authority  (i)
pertaining to the transactions contemplated by this Agreement or (ii) seeking to
prohibit or limit the  ownership or  operation by the Company,  Parent or any of
its subsidiaries,  or to dispose of or hold separate any material portion of the
business or assets of the Company, Parent or of its any subsidiaries.

     (d)  Consents,  etc.  Company  shall have  received  evidence,  in form and
substance reasonably satisfactory to it, that such licenses,  permits, consents,
approvals, authorizations, qualifications and orders of governmental authorities
and other  third  parties  as  necessary  in  connection  with the  transactions
contemplated hereby have been obtained.

     (e) Filing of Merger  Agreement.  Parent shall have filed or will  promptly
file after the  Closing  Date in the office of the  Secretary  of State or other
office of each jurisdiction in which such filings are required for the Merger to
become effective.

                                       21
<PAGE>

     (f) Resignations.  Parent shall deliver to the Company written resignations
of all of the  officers  of the Parent and  evidence  of  election  of those new
directors and officers as further described in Section 5.06 herein.

     (g) 8-K. The post-merger  company shall file a Form 8-K with the SEC within
four days of the Closing Date  containing  audited  financial  statements of the
Company as required by Regulation S-X.

                                  ARTICLE VII:
                                  ------------
                        TERMINATION, AMENDMENT AND WAIVER

7.01  Termination.  This  Agreement may be terminated  and abandoned at any time
-----------------
prior to the Effective Time of the Merger:

     (a) by mutual written consent of Parent and the Company;

     (b) by either Parent or the Company if any  Governmental  Entity shall have
issued an  order,  decree  or  ruling  or taken  any  other  action  permanently
enjoining,  restraining  or  otherwise  prohibiting  the Merger and such  order,
decree, ruling or other action shall have become final and nonappealable;

     (c) by  either  Parent or the  Company  if the  Merger  shall not have been
consummated  on or before  March 15, 2005 (other than as a result of the failure
of the party  seeking to terminate  this  Agreement  to perform its  obligations
under this Agreement  required to be performed at or prior to the Effective Time
of the Merger);

     (d) by Parent, if a material adverse change shall have occurred relative to
the Company;

     (e) by Parent,  if the Company  willfully  fails to perform in any material
respect any of its material obligations under this Agreement; or

     (f) by the Company,  if Parent or Merger Sub willfully  fails to perform in
any material respect any of their respective obligations under this Agreement.

7.02 Effect of  Termination.  In the event of  termination  of this Agreement by
---------------------------
either the Company or Parent as provided in Section 7.01,  this Agreement  shall
forthwith become void and have no effect, without any liability or obligation on
the part of Parent, Merger Sub or the Company,  other than the provisions of the
last  sentence of Section  5.01(a) and this Section 7.02.  Nothing  contained in
this  Section  shall  relieve  any party for any breach of the  representations,
warranties, covenants or agreements set forth in this Agreement.

7.03  Amendment.  This  Agreement may not be amended  except by an instrument in
---------------
writing signed on behalf of each of the parties.

                                       22
<PAGE>

7.04 Extension;  Waiver.  Subject to Section  7.01(c),  at any time prior to the
-----------------------
Effective  Time of the  Merger,  the  parties  may (a)  extend  the time for the
performance of any of the  obligations  or other acts of the other parties,  (b)
waive any inaccuracies in the representations  and warranties  contained in this
Agreement or in any document delivered pursuant to this Agreement,  or (c) waive
compliance with any of the agreements or conditions contained in this Agreement.
Any  agreement  on the part of a party to any such  extension or waiver shall be
valid only if set forth in an  instrument  in  writing  signed on behalf of such
party.  The failure of any party to this  Agreement  to assert any of its rights
under this Agreement or otherwise shall not constitute a waiver of such rights.

7.05 Procedure for Termination, Amendment, Extension or Waiver. A termination of
--------------------------------------------------------------
this Agreement pursuant to Section 7.01, an amendment of this Agreement pursuant
to Section 7.03 or an extension or waiver of this Agreement  pursuant to Section
7.04 shall, in order to be effective,  require in the case of Parent, Merger Sub
or the Company, action by its Board of Directors.

7.06 Return of Documents.  In the event of termination of this Agreement for any
------------------------
reason,  Parent  and  Company  will  return to the other  party all of the other
party's documents,  work papers, and other materials (including copies) relating
to the transactions  contemplated in this Agreement,  whether obtained before or
after  execution  of  this  Agreement.  Parent  and  Company  will  not  use any
information  so obtained  from the other party for any purpose and will take all
reasonable steps to have such other party's information kept confidential.

                                  ARTICLE VIII:
                                  -------------
                       INDEMNIFICATION AND RELATED MATTERS

8.01  Survival  of  Representations  and  Warranties.  The  representations  and
----------------------------------------------------
warranties in this  Agreement or in any  instrument  delivered  pursuant to this
Agreement  shall survive the Effective  Time of the Merger until the  Settlement
Date.

8.02 Indemnification.
--------------------

     (a)  Irrespective of any due diligence  investigation  conducted by Company
with regard to the transactions  contemplated hereby, the Parent shall indemnify
and hold the  Company  and each of its  officers  and  directors  (the  "Company
Representatives")   harmless   from  and  against   any  and  all   liabilities,
obligations,  damages,  losses,  deficiencies,  costs,  penalties,  interest and
expenses (collectively, "Losses") arising out of, based upon, attributable to or
resulting from any and all Losses  incurred or suffered by the Company or any of
the  Company  Representatives  resulting  from or arising out of any breach of a
representation, warranty or covenant made by Parent as set forth herein.

                                       23
<PAGE>

     (b) The  Company  shall  indemnify  and  hold  the  Parent  and each of its
officers and directors (the "Parent Representatives")  harmless from and against
any and all liabilities,  obligations,  damages,  losses,  deficiencies,  costs,
penalties, interest and expenses (collectively,  "Losses") arising out of, based
upon,  attributable to or resulting from any and all Losses incurred or suffered
by the Parent or any of the Parent Representatives resulting from or arising out
of any breach of a  representation,  warranty or covenant made by Company as set
forth herein.

8.03 Notice of Indemnification.  In the event any proceeding shall be threatened
------------------------------
or  instituted  or any claim or demand  shall be  asserted  in  respect of which
payment  may be sought  by the  Parent or any  Parent  Representative  or by the
Company or any Company  Representative,  against  the other,  as the case may be
(each an "Indemnitee"), under the provisions of this Article VIII (an "Indemnity
Claim"),  the Indemnitee shall promptly cause written notice of the assertion of
any such Claim of which it has knowledge  which is covered by this  indemnity to
be forwarded to the Parent  Representative,  who shall be Shawn Erickson, or the
Company.   Any  notice  of  an   Indemnity   Claim  by  reason  of  any  of  the
representations, warranties or covenants contained in this Agreement shall state
specifically the representation,  warranty or covenant with respect to which the
Indemnity  Claim is made,  the facts  giving  rise to an  alleged  basis for the
Claim, and the amount of the liability asserted against the Indemnitor by reason
of the  Indemnity  Claim.  Within ten (10) days of the  receipt of such  written
notice,  the Parent  Representative  or the  Company,  as the case may be, shall
notify the  Indemnitee  in writing of its intent to contest the  indemnification
obligation  (a  "Contest")  or to  accept  liability  hereunder.  If the  Parent
Representative  or the Company,  as the case may be, does not respond within ten
(10) days of the request of such  written  notice to such  written  notice,  the
Parent  Representative  or the  Company,  as the case may be,  will be deemed to
accept liability as it relates to the Merger  Consideration.  In such event, the
Indemnitee will deliver a Notice to the Parent that there is a determination  of
liability to this Section 8.03 and the Parent shall be  instructed to adjust the
Merger  Consideration.  In the event of a  Contest,  within ten (10) days of the
receipt of the written notice thereof,  the parties will select  arbitrators and
submit the  dispute  to binding  arbitration  before  the  American  Arbitration
Association at a venue to be located in New York City. The arbitrators  shall be
selected by the mutual agreement of the parties. If the parties can not agree on
the  arbitrator,   each  may  select  one  arbitrator  and  the  two  designated
arbitrators shall select the third  arbitrator.  If the third arbitrator can not
be agreed upon,  the American  Arbitration  Association in New York shall select
the third  arbitrator.  A decision by the  individual  arbitrator  or a majority
decision by the three  arbitrators  shall be final and binding upon the parties.
Such arbitration shall follow the rules of the American Arbitration  Association
and must be resolved by the arbitrators within thirty (30) days after the matter
is submitted to arbitration. If the arbitration is ruled favorably for Parent so
that there is a determination of a Loss, the Indemnitee will deliver a Notice to
Parent that there is a determination of liability  pursuant to this Section 8.03
and the Parent shall adjust the Merger Consideration Deposit accordingly.

                                       24
<PAGE>

                                   ARTICLE IX:
                                   -----------
                               GENERAL PROVISIONS

9.01 Notices. All notices,  requests,  claims,  demands and other communications
------------
under this Agreement  shall be in writing and shall be deemed given if delivered
personally  or  sent  by  facsimile,   electronic  mail,  or  overnight  courier
(providing  proof of delivery) to the parties at the following  addresses (or at
such other address for a party as shall be specified by like notice):

     (a)  if to Parent or Parent Representative, to:

     Attention:  Shawn Erickson
     280 Nelson Street
     Suite 448
     Vancouver A1 V6B 2E2
     Canada
     (408) 640-8918

     (b)  if to the Company, to:

     Attention: Ping'an Wu
     111 Changan Middle Road, 15th Floor, Xi'an, China

9.02 Definitions. For purposes of this Agreement:
----------------

     (a) an  "affiliate"  of any person means  another  person that  directly or
indirectly,  through one or more intermediaries,  controls, is controlled by, or
is under common control with, such first person;

     (b) "material adverse change" or "material adverse effect" means, when used
in  connection  with the  Company or Parent,  any change or effect  that  either
individually  or in the  aggregate  with all other  such  changes  or effects is
materially adverse to the business, assets, properties,  condition (financial or
otherwise) or results of operations of such party and its subsidiaries  taken as
a whole (after  giving effect in the case of Parent to the  consummation  of the
Merger);

     (c) "person" means an individual, corporation,  partnership, joint venture,
association, trust, unincorporated organization or other entity; and

     (d) a  "subsidiary"  of any person means another  person,  an amount of the
voting  securities,  other voting ownership or voting  partnership  interests of
which is  sufficient  to elect at least a majority of its board of  Directors or
other governing body (or, if there are no such voting  interests,  fifty percent
(50%) or more of the equity  interests of which) is owned directly or indirectly
by such first person.

9.03  Interpretation.  When a reference is made in this  Agreement to a Section,
--------------------
Exhibit or Schedule,  such reference  shall be to a Section of, or an Exhibit or
Schedule to, this Agreement unless otherwise  indicated.  The headings contained
in this  Agreement are for  reference  purposes only and shall not affect in any

                                       25
<PAGE>

way  the  meaning  or  interpretation  of this  Agreement.  Whenever  the  words
"include",  "includes" or "including" are used in this Agreement,  they shall be
deemed to be followed by the words "without limitation".

9.04 Entire  Agreement;  No  Third-Party  Beneficiaries.  This Agreement and the
-------------------------------------------------------
other  agreements  referred  to herein  constitute  the  entire  agreement,  and
supersede all prior agreements and understandings,  both written and oral, among
the parties with respect to the subject matter of this Agreement. This Agreement
is not  intended to confer upon any person  other than the parties any rights or
remedies.

9.05  Governing  Law.  This  Agreement  shall be governed  by, and  construed in
--------------------
accordance with, the laws of the State of New York,  regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws thereof.

9.06  Assignment.  Neither this  Agreement  nor any of the rights,  interests or
----------------
obligations  under this  Agreement  shall be assigned,  in whole or in part,  by
operation of law or otherwise  by any of the parties  without the prior  written
consent of the other parties.  Subject to the preceding sentence, this Agreement
will be  binding  upon,  inure to the  benefit  of, and be  enforceable  by, the
parties and their respective successors and assigns.

9.07 Enforcement.  The parties 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  breaches of this  Agreement and to enforce  specifically
the terms and  provisions  of this  Agreement in any court of the United  States
located in the State of Colorado,  this being in addition to any other remedy to
which they are entitled at law or in equity.  In  addition,  each of the parties
hereto  (a) agrees  that it will not  attempt  to deny or defeat  such  personal
jurisdiction  or venue by motion or other request for leave from any such court,
and (b) agrees that it will not bring any action  relating to this  Agreement or
any of the transactions  contemplated by this Agreement in any state court other
than such court.

9.08 Severability. Whenever possible, each provision or portion of any provision
-----------------
of this  Agreement  will be  interpreted  in such manner as to be effective  and
valid under  applicable  law but if any provision or portion of any provision of
this Agreement is held to be invalid,  illegal or  unenforceable  in any respect
under  any  applicable  law  or  rule  in  any  jurisdiction,  such  invalidity,
illegality or unenforceability will not affect any other provision or portion of
any  provision  in such  jurisdiction,  and  this  Agreement  will be  reformed,
construed  and  enforced in such  jurisdiction  as if such  invalid,  illegal or
unenforceable  provision or portion of any  provision  had never been  contained
herein.

9.09  Counterparts.  This  Agreement  may be executed  in one or more  identical
------------------
counterparts,  all of which shall be considered one and the same  instrument and
shall  become  effective  when one or more  such  counterparts  shall  have been
executed by each of the parties and delivered to the other parties.

                                       26
<PAGE>

     IN WITNESS  WHEREOF,  the  undersigned  have caused  their duly  authorized
officers  (or  representatives  in the  case  of  Merger  Sub) to  execute  this
Agreement as of the date first above written.

Bangla Property Management, Inc.
--------------------------------

By:

----------------------------
Name: Shawn Erickson
Title: President & CEO

Wollaston Industrial Limited
----------------------------

By:

----------------------------
Name:  Ping'an Wu
Title: President

China Property Holding, Inc.
----------------------------

By:

----------------------------
Name:  Ping'an Wu
Title: President

                                       27

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