Document:

Unassociated Document

     

    SNXJZ
      [2008] No. 002

     

     

     

     

     

    

     

     

    

     

     

    Contract
      of Loan

     

     

    

     

     

     

    

     

     

    

     

     

    

     

     

    Shaanxi
      Rural Credit Cooperative 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Contract
      of Loan

     

    SNXJZ
      [2008] No. 002

     

    Loanee:
      Shaanxi
      Aoxing Pharmaceutical Co., Ltd. 

    Domicile
      (Address):
      Chenyang Zhai

    Legal
      representative: Wang
      Ronghua

    Tel.:
      13992059888
      Postcode:
      712000

    Basic
      opening bank:  Account
      No.:  

    Loaner:
      Qindu
      District Rural Credit Cooperative (Fengxi Branch)

    Domicile
      (Address):
      Chenyang Zhai 

    Legal
      representative (principal): Wang
      Li

    Tel.:
      33689747
      Postcode: 712000

     

    The
      Loanee applied to the Loaner for loan, and the Loaner consented to supply loan
      to the Loanee. In order to nail down the rights and obligations of the both
      parties, in accordance with the “Contract Law”, “General Rule on Loan” and other
      relevant regulations and rules, the both parties concluded this contract
abiding
      by the principles of equality, voluntariness and reaching unanimity through
      consultation

     

    Article
      1: The
      Loanee's statement and guarantee

     

    The
      Loanee is an entity which is established according to law and possesses
      qualification of legal person (or a branch authorized by legal person legally),
      has the ability to fulfill this contract according to law.

     

    Article
      2: Type of loan: Short-term
      pledge 

     

    Article
      3: Amount
      of loan: (RMB in words) RMB three million eight hundred thousand Yuan, (in
      figure) RMB 3,800,000 Yuan.

     

    Article
      4: Purpose
      of loan: purchase
      raw material

     

    Article
      5: Term
      of loan: from Feb. 13, 2008 to Aug. 12, 2008. (Subject to the time in due bill
      if the time is inconsistent with loan contract).

     

    The
      Loanee shall withdraw the money in onetimes.

     

    08/13/02,
      amount (in words)  3,800,000

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    MM/DD/YY,
      amount (in words) ______

     

    MM/DD/YY,
      amount (in words) ______

     

    MM/DD/YY,
      amount (in words) ______

     

    MM/DD/YY,
      amount (in words) ______

     

    Article
      6: Loan
      rate, interest and interest payment mode

     

    (I)
      Loan
rate:
      monthly interest rate is 8.16‰.

     

    During
      the contract term, implement
      according the contract interest rate for the short term loan ( within one year,
      include one year ) if the interest rate is adjusted by the state; and the
      interest rate of medium of long term loan(exceed one year, and exclude one
      year)
      shall be determined according to the principle below.

     

    1.
      Execute the contract interest rate;

     

    2.
      Adjust according to year which shall be decided once annually (the payment
      day
      of the first loan shall be the base day if the loan is distributed by stages),
      and the interest rate shall not be changed after being determined. Determine
      the
      interest rate of the following year according to the loan rate of relevant
      grade
      when a year and a day. And the Loaner and calculate interest according to the
      adjusted rate and mode and need not to inform the Loanee.

     

    (II)
      The loan interest shall be calculated as of the date that the loan is
      transferred to the Loanee's account.

     

    (III)
      The Loanee shall pay the interest on time on the 20th day (monthly/quarterly),
      the Loaner shall be entitled to deduct from the Loanee's account if the Loanee
      fails to pay the interest on time.

     

    Article
      7: Repayment
      mode and fund resources:

     

    (IV)
      The Loanee shall repay principal and interest of the loans according to the
      regulated term. And the Loaner shall be entitled to withdraw from the Loanee's
      account if the principal and interest fails to be repaid.

     

    (V)
      Repayment plan:

     

    08/12/08,
      amount (in words)  3,800,000
      

     

    MM/DD/YY,
      amount (in words) ______

     

    MM/DD/YY,
      amount (in words) ______

     

    MM/DD/YY,
      amount (in words) ______

     

    MM/DD/YY,
      amount (in words) ______

     

    (III)
      Source of repayment amount:

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    1.
      Operating
      income

     

    2. _____________ 

     

    3.
      Whole
      assets

     

    4.
      Other property not limited to the above-mentioned property source.

     

    Article
      8: Guarantee

     

    (I)
      loan guarantee mode under this contract shall be: mortgage
      guarantee.

     

    (II)
      The Loanee shall be obligated to assist the Loaner and the Warrantor to sign
      a
      guarantee contract on the specific guarantee matters of this contract with
      a
      serial number of 2008
      No. 002 actively
      which shall be the guarantee of performing this contract debt.

     

    (III)
      If the guarantee under this contract occurs change which will make against
      the
      Loaner's credit, informed by the Loaner, the Loanee shall supply a guarantee
      satisfying the Loaner otherwise as required.

     

    Article
      9: The
      Loanee's promise

     

    (I)
      Pay interest on time and repay the principal and interest of loan.

     

    (II)
      Use loan according to purpose regulated by the contract, and shall not change
      the purpose of loan arbitrarily.

     

    (III)
      Supply the true balance sheet, profit and loss statement, the opening bank
      as
      well as account etc. to the Loaner monthly. 

     

    (IV)
      Accept and cooperate with the Loaner to inspect and supervise the service
      condition of loan and relevant production operation and financing
      activities.

     

    (V)
      It should inform the Loaner in advance and shall not influence the Loaner to
      recall loans on time if guarantee other people' debt with the enterprise assets.
      

     

    (VI)
      It should inform the Loaner in advance when the legal representative is
      modified, legal person's domicile or operation and registered capital is
      changed.

     

    (VII)
      It must inform the Loaner 30 days in advance and carry out debt and repayment
      measure when carrying out system modification as contracting, tenancy, joint
      management, consolidation, (merge), reconstruction of joint stock system,
      division, trusteeship, conveyance of property, foreign investments and joint
      venture with foreigner (cooperation) etc.

     

    (VIII)
      The Loanee shall inform the Loaner within 3 days in written form and return
      the
      whole principal and interest of loan and the correlative charges when happening
      closure of business, suspension of business for rectification, or the business
      license is revoked or cancelled.

     

    (IX)
      The Loaner may deduct the account directly from the Loanee's account if the
      Loaner should recall or recall principal and interest of loan in advance
      according to the contract provisions.

     

    
      
         

      

      
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    Article
      10: The
      Loaner's promise

     

    (I)
      Offer loans to the Loanee fully on schedule.

     

    (II)
      Keep the Loanee's debt, finance, production and operation status
      secret.

     

    (III)
      Not collect the expenses other than the charges in contract.

     

    Article
      11: liability
      for breach of contract

     

    (I)
      The Loanee's breach of contract

     

    1.
      The Loaner shall be entitled to stop offering loans, reclaim the dispensed
      part
      or even the whole loan or terminate the contract if the Loanee fails to use
      the
      loan according to the purpose appointed in this contract, at the same time,
      the
      Loaner shall additionally collect 50% default interest to the loan which is
      used
      breaching of contract according to the stipulation of People's Bank of China
      based on the daily interest rate according to the number of days of breach
      of
      contract, till the principal and interest is paid off(calculate the interest
      in
      section if the interest rate of default interest is adjusted).

     

    2.
      The Loaner shall have
      the
      right to add 30% default interest for the overdue loan based on the rate
      foundation of People's Bank of China if the Loanee fails to repay the principal
      and interest of loan according to the appointed repayment time in the contract,
      till the principal and interest is paid off (calculate the interest in
      subsection if meet the interest rate of default interest is
      adjusted);

     

    (II)
      The Loaner's breach of contract

     

    1.
      The Loaner shall under penalty which is 5 ‰ of total sum if terminate the
      contract unilaterally without reason; and the Loaner's responsibility shall
      be
      exempted if the loan can not be supplied owing to the Loanee's
      reason;

     

    2.
      The Loanee shall be entitled to to refuse if the Loaner violates the third
      item
      of article 10; and the Loanee shall be entitled to lodge a complaint to the
      supervisory management department of banking industry if the Loaner violates
      the
      second item of article 10.

     

    Article
      12:
      Effectiveness, modification, cancellation and termination of the
      contract.

     

    (I)
      Effectiveness of the contract

     

    This
      contract shall come into force as of the date of being signed by both the Loanee
      and the Loaner and signed and sealed by legal representative or authorized
      agent
      of legal representative of the two parties.

     

    (II)
      Termination of the contract

     

    This
      contract shall be terminated as of the day that the principal, interest, default
      interest, penalty, compensation money, expense realizing credit and other all
      of
      expense payable ( include legal cost, execution fee, agent fee, advertising
      cost, auction charge, insurance fee, judgment fee, evaluation fee, registration
      fee, transfer fee and custody charge etc.) under this contract are paid
      off.

     

    
      
         

      

      
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    (III)
      Modification and cancellation of the contract

     

    1.
      The Loaner shall be entitled to terminate the contract and ask the Loanee to
      repay the principal and interest of loan and compensate the loss in advance
      under any of the following circumstances.

     

    (1)
      Under the circumstance that the Loanee goes out of business, dismisses, puts
      up
      the shutters for rectification, and the business license is revoked or
      cancelled;

     

    (2)
      If the guarantee under this contract occurs change which will make against
      the
      Loaner's credit, and the Loanee fails to supply the required guarantee according
      to the Loaner's requirement;

     

    (3)
      The Loanee has other serious nonperformance.

     

    2.
      The Loanee shall put forward a written application and a written opinion that
      the Warrantor consents to continue supply guarantee 30 days in advance before
      the expiration of the contract if the Loanee asks to extend the period of loan,
      the period of loan under this contract can be extended only if the above written
      application and written opinion are examined and accepted by the Loaner and
      an
      agreement on extending the period of loan is signed. The loan rate shall be
      determined according to accumulative period grade. Before the both parties
      signing the agreement on extending the period of loan, this loan contract shall
      be executed continually; and it shall be the attachment of this contract after
      the agreement on extending the period of loan is signed.

     

    3.
      Except the stipulation in this contract, either the Loanee or the Loaner shall
      not modify or terminate this contract arbitrarily in advance once the contract
      becomes effective. And the both parties shall conclude a written agreement
      through negotiation by consensus if this contract is required to be modified
      or
      terminated in troth. This contract is still effective before the written
      agreement is concluded.

     

    Article
      13: Settlement of dispute

     

    (I)
      Any dispute arising from the contract shall be settled through friendly
      negotiation of both parties. In case no settlement is reached, it shall be
      dominated by the people's court at the place where the Loaner’s residence is
      situated

     

    2.
      When
      the loan expires, the Loanee
      shall
      voluntarily accept the compulsory execution of People's Court if the
Loanee
      and the
Warrantor
      fail to
      repay the principal and interest of loan according to the contract.

     

    
      
         

      

      
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    Article
      14: Other matters appointed by the both parties

     

    1.
      The
      real estate is located in the north side, west section of century highway,
      Qindu
      District. The area is 5301.6 m2, and appraisal value is 12,378,400
      Yuan.

     

    2.
      The
      parties concerned shall voluntarily notarize and consent that this loan contract
      owns the compulsory execution effect issued by the notarization organ, the
      Loanee shall voluntarily accept the compulsory execution of People's Court
      if
      fail to repay the principal and interest of loan according to the
      contract.

     

    Article
      15: Supplementary articles

     

    (I)
      The attachment to the contract shall be the indiscerptible component of this
      contract and shall have the equal legal force with the text of this
      contract.

     

    (II)
      During fulfilling the contract, the withdrawal day and repayment day shall
      be
      postponed to the next working day if the days are off day of financial
      institution

     

    (III)
      The both parties in the contract have sufficiently negotiated and understood
      all
      of clauses especially the marked part, they have reached
      unanimity and
      made no difficulty.

     

    (IV)
      This contract is in sextuplicate, the Loanee, warrantor, notary organs,pledge
      registration organ shall keep one original respectively, and the Loaner shall
      keep two originals, and each have the equal legal force.

     

    Article
      16: Attachment

     

    (I)
      The Loanee's business license which has the annual check of the current year
      by
      industrial and commercial administration bureau (photocopy)

     

    (II)
      The Loanee's Code Certificate of Organization and Institution
(photocopy)

     

    (III)
      Legal representative's ID card (photocopy)

     

    (IV)
      Original of entrusted agent's letter of authorization and ID card (
      photocopy)

     

    (V)
      Loan card (photocopy), card No and password.

     

    (VI)
      Resolution letter on loan approved by board of directors

     

    
      
         

      

      
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    Loaner
      (official seal) Shaanxi
      Aoxing Pharmaceutical Co., Ltd. (sealed)

     

    Legal
      representative (signature and seal): Wang
      Ronghua (sealed)

     

    (Authorized
      agent)

     

     

     

     

    Loaner
      (official seal) Qindu
      District Rural Credit Cooperative, Xianyang City (sealed)

     

    Legal
      representative (principal): Wang
      Li (sealed)

     

    (Authorized
      agent)

     

     

    Date
      of
      signing: Feb. 13, 2008

     

    Place
      of
      signing: Fengxi Credit Cooperative

     

    
      
         

      

      
        7Cooperation
      Agreement

     

    Party
      A:
      College
      of Life Science of Northwest University

     

    Party
      B:
      Shaanxi
      Aoxing Pharmaceutical Co., Ltd.

     

    Party
      A
      and Party B through mutual negotiations hereby enter into this cooperation
      agreement (the “Agreement”)
      regarding to the issues of intern practice base and technical cooperation
      according to the following terms and conditions on September 10,
      2006:

     

    Article
      1 Intern Practice

     

    1.1
      Intern practice base 

     

    Party
      A
      agrees to engage Party B as Party A’s teaching and science researching practice
      base, and Party B agrees to become Party A’s teaching and science researching
      practice base.

     

    1.2
      Interns

     

    Party
      B
      will send interns (the “Interns”)
      in two
      groups a year to practice in Party B; the Interns shall be the official enrolled
      students, teachers, employees or researchers of Party A; the number of Interns
      sent each group shall be between 30 to 40. The intern practice fee for each
      Intern is RMB 600 per month.

     

    1.3
      The schedule and content of intern practice

     

    Party
      A
      shall notify the number, name list and general introduction of the Interns
      to
      Party B in advance; Party B shall have the right to decide on the schedule,
      positions and content of intern practice, in consideration of the Interns’
actual ability and time. Party B shall notify Party A seven days in advance
      after the aforesaid decision is made.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    1.4
      Intern practice fee

     

    The
      intern practice fee for each Intern is RMB 600 per month, and Party B shall
      pay
      the intern practice fee to Party A; the commuting, beverage and food expenses
      of
      the Interns shall be paid by Party B, but the total amount of such expense
      shall
      not beyond RMB 4,000 per month.

     

    1.5
      Recruitment

     

    Party
      B
      agrees to consider the Interns after their graduation as priority in Party
      B’s
      recruitment.

     

    Article
      2 Technical Cooperation

     

    2.1
      Technical support

     

    Party
      A
      agrees to teach Party B the planting, identifying knowledge of traditional
      Chinese medicine and other biological technology (the “Technical
      Support”).
      Party
      A shall have the right to decide on the content of Technical Support, in
      consideration of the actual need of Party B.

     

    Unless
      otherwise claimed by Party A, the technology, technique, method, information
      and
      other written or unwritten materials (the “Technical
      Information”)
      taught
      by Party A in Technical Support shall be deemed to be authorized to Party B
      for
      use by Party A, without any ownership transfer.

     

    Party
      B
      shall ensure that Technical Information not infringe any third party’s
      intellectual property right. If Party A loses the ownership of Technical
      Information, it shall immediately inform Party B. If Party B suffers any loss
      occurring from the claims by a third party for the infringement of its
      intellectual property right due to the improper notice of Party A, Party A
      shall
      make up such loss. 

     

    Party
      B
      does not have to pay any fee to Party A for the Technical Support and Technical
      Information under this Agreement.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    2.2
      Academic exchanges

     

    Party
      A
      agrees to accept Party B’s staff (the “Learning
      Staff”)
      to
      learn advanced traditional Chinese medicine and pharmaceutical knowledge. Party
      A has right to arrange the time and way of learning in consideration of Party
      B’s need. The learning tuition shall be paid according to the relevant laws and
      regulations.

     

    Party
      A
      agrees to send experts and professors regularly to Party B for academic
      discussions and communications. Party A and Party B may decide on the schedule
      of such exchange by reaching other agreement, but the exchange shall not be
      less
      than 12 persons a year.

     

    2.3
      R&D of new drug

     

    Party
      A
      and Party B agree to cooperate on the R&D of new drug (the “Project
      Cooperation”).
      All
      the products and relevant intellectual property rights of Project Cooperation
      shall belong to Party B. Party A shall, according to the request of Party B,
      deliver all samples, formulas, methods, techniques, experiment records,
      documents, drawings and other information (the “Researching
      Materials”)
      regarding the Project Cooperation to Party B or the third party appointed by
      Party B.

     

    Party
      A
      shall give necessary assistance when Party B applys for new drug or patent,
      and
      keep the content, products and Researching Materials confidential.

     

    For
      each
      product of Project Cooperation, Party B shall pay certain fee to Party B on
      the
      basis of valuation result. Party A and Party B shall make agreement for the
      details of each co-operation of Project Cooperation besides this
      Agreement.

     

    Article
      3 Rights and Responsibilities of Party A and Party B

     

    3.1
      Party A’s rights

     

    Party
      A
      has right to: (1) request Party B to accept the Interns to practice in Party
      B,
      and send teacher or employees to supervise and advise on practice; (2) decide
      on
      the method and content of Technical Support in consideration of Party B’s need;
      (3) reasonably arrange the learning time and way of Learning Staff.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    3.2
      Party A’s Responsibilities

     

    Party
      A
      has responsibilities to (1) notify the number, name list and general
      introduction of the Interns to Party B in advance; (2) ensure that Technical
      Information not infringe any third party’s intellectual property right and
      immediately inform Party B If Party A loses the ownership of Technical
      Information; (3) accept the Learning Staff to learn in Party A and send experts
      and professors regularly to Party B for academic discussions and communications;
      (4) according to the request of Party B, deliver Researching Materials regarding
      the Project Cooperation to Party B or the third party appointed by Party B,
      give
      necessary assistance when Party B apply for new drug or patent, and keep the
      content, products and Researching Materials confidential.

     

    3.3
      Party B’s rights 

     

    Party
      B
      has right to (1) decide on the schedule, positions and content of intern
      practice, in consideration of the Interns’ actual ability and time; (2) receive
      Technical Support from Party A and use the Technical Information (3) obtain
      the
      ownership of all the products and relevant intellectual property rights of
      Project Cooperation and Researching Materials, and request Party A for giving
      necessary assistance when Party B apply for new drug or patent.

     

    3.4
      Party B’s responsibilities 

     

    Party
      B
      has responsibilities to (1) accept the Interns to practice in Party B, and
      notify the schedule, positions and content of intern practice to Party A seven
      days in advance; (2) keep the Technical Information confidential.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Article
      4 Term of Cooperation

     

    The
      term
      of cooperation under this Agreement is September 10, 2006 to September 10,
      2008.
      This Agreement shall be automatically terminated upon the expiration of
      cooperation term.

     

    Article
      5 Copies

     

    This
      Agreement is executed in two (2) copies; each Party holds one and each original
      copy has the same legal effect.

     

    (REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK)

      
        

      

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Party
      A:
      College
      of Life Science of Northwest University (seal)

     

    Authorized
      Representative (signature): 

     

     

    Party
      B:
      Shaanxi
      Aoxing Pharmaceutical Co., Ltd. (seal) 

     

    Authorized
      Representative (signature):

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