Commercial Contract

The Buyer:

The Seller:

This contract is made by and between the Buyer and the Seller, whereby the Buyer agrees to buy and the Seller agrees to sell the under-mentioned commodity according to the terms and conditions stated below:

1. Commodity:

Quantity:

Unit price:

Total amount:

2. Country of origin and manufacture:

3. Packing:

To be packed in strong wooden cases or cartons, suitable for long distance Ocean, parcel post or air freight transportation as well as changing climate and with good resistance to moisture and shocks.

The Seller shall be liable for any damage of the commodity due to improper packing and for any rust attributable to inadequate protective measures in regard to the packing.

One full set of service and operation manual shall be enclosed in each case.

4. Shipping mark:

The Seller shall mark on each package with fadeless paint the package number, gross weight, net weight, measurement and warnings such as “HANDLE WITH CARE”, “KEEP AWAY FROM HEAT”, “KEEP AWAY FROM MOISTURE” as well as shipping mark.

5. Date of shipment:

6. Port of shipment:

7. Port of destination:

8. Insurance:

To be borne by the Buyer after shipment

9. Payment, under conditions (1), (2) and (3) below:

(1) Through the letter of credit:

The Buyer, on receipt from the Seller of the delivery advice, shall open an irrevocable letter of credit with the Bank of China, in favor of the Seller for the total value of shipment 25-30 days prior to the date of delivery. The credit shall be available against Seller’s draft drawn at sight on the opening bank for 100% invoice value accompanied by the shipping documents specified in Clause 10 hereof. Payment shall be effected by the opening bank by telegraphic transfer against presentation of the aforesaid draft and documents. The letter of credit shall be valid until the 20th day after the shipment is effected.

(2) Collection:

The Seller may present the sight draft together with the shopping documents (specified in Clause 10 hereof) through the Seller’s bank and Buyer’s bank to the Buyer for collection after shipment.

(3) By direct remittance:

Payment shall be effected by the Buyer, by telegraphic transfer, within 7 (seven) days after receipt from the Seller of the shipping documents specified in the Clause 10 hereof.

10. Documents

(1) In case of sea-freight:

Full set of clean bills of lading marked “Freight to Collect”, “Freight Prepaid” made out to blank endorsed notifying Zhonghua International Technology Development Corporation at the port of destination.

(2) In case of air-freight:

One copy of airway bill marked “Freight to Collect”, “Fright Prepaid” and sent to the Buyer.

(3) Invoice in 4 copies indicating contract number and shipping mark, made out in details as per the contract concerned.

(4) Packing list in 2 copies issued by the manufacturer.

(5) Certificate of quality and quantity issued by the manufacturer.

(6) The buyer shall be advised by mail/cable immediately after shipment.

In addition, the Seller shall, within 10 (ten) days after shipment, send by airmail tow sets of aforesaid documents (except item 4) with one set directly to the Buyer and one set directly to xxxxxxxxx(company name) at the port of destination.

11. Shipment

(1) In case of FOB terms

a. The Seller shall, 30 days before the contracted date of shipment, advise the Buyer by cable or letter of the contract number, name of commodity, quality, value, package number, gross weight, measurement and date of readiness at the port of shipment for the Buyer to book shipping space.

b. Booking of shipping space shall be arranged by the Buyer’s shipping agent, China Ocean Shipping Agency.

c. The Buyer’s shipping agent (China Ocean Shipping Agency) shall send to the Seller notice indicating the name of vessel, estimated date of loading and contract number for the Seller to arrange shipment 10 (ten) days before the estimated date of arrival of the vessel at the loading port. The Seller is requested to get in close contract with the shipping agent. When it becomes necessary to change the carrying vessel or to advance or delay the arrival date, the Buyer or the shipping agent shall advise the Seller in time. Should the vessel fail to arrive at the loading port within 30 (thirty) days after the arrival date advised by the Buyer, the Buyer shall bear the storage and insurance expenses incurred from the 30th day thereafter.

d. The Seller shall be liable for any dead freight or demurrage, should it happen that they have failed to have the commodity ready for loading after the carrying vessel has arrived at the port of shipment on time.

e. The Seller shall bear all expenses and risks before the commodity passes over the vessel’s rail and is released from the tackle, all expenses and risks shall be in Buyer’ account.

(2) In case of CFR terms

a. The Seller shall ship the goods within the shipment time from the loading port to the port of destination. Transshipment is not allowed.

b. In case the goods are to be dispatched by air freight, the Seller shall, 30 (thirty) days before the time of delivery as stipulated in Clause 5, inform the buyer by cable or letter of the estimated date of delivery, contract number, name of commodity, and invoiced value. The Seller shall, immediately after dispatch of the goods, advise the Buyer by cable or letter of the contract number, name of commodity, and invoiced value and date of dispatch for the Buyer to arrange the insurance in time.

12. Shipping advice

The Seller shall, immediately on the completion of the loading of the goods, advise the Buyer by cable or letter of the contract number, name of commodity, quantity, invoiced value, and gross weight, name of vessel and date of sailing. In case the Buyer fails to arrange insurance in time due to the Seller’s not having cabled in time, all losses shall be borne by the Seller.

13. Guarantee of quality

The Seller guarantees that the commodity hereof is made of the best materials with first class workmanship, brand new, unused, and complies with the quality and specifications stipulated in this contract. The guarantee period shall be 12 (twelve) months starting from the date on which the commodity arrives at the port of destination.

14. Claims

Except those claims for which the insurance company or the owner of the vessel are liable, should the quality, specifications or quantity be found not in conformity with the stipulations of the contract, within 90 (ninety) days after the arrival of the goods at destination, the Buyer can use the Inspection Certificate issued by China National Import and Export Commodities Inspection Corporation to claim for replacement or compensation. All the expenses incurred (such as inspection charges, freight charges for returning and sending of replacement, insurance premium, storage, loading and unloading charges) shall be borne by the Seller.

In regard to quality, the Seller shall guarantee that if, within 12 (twelve) from the date of arrival of the goods at destination, damages occur in the course of operation by reason of inferior quality of material or bad workmanship, the Buyer shall immediately notify the Seller in writing and put forward a certificate issued by the CCIC. The certificate so issued shall be accepted as the base of the claim. The Seller, in accordance with the Buyer’s claim, shall be responsible for the immediate elimination of the defects, complete or partial replacement of the commodity, or devalue the commodity according to the state of defects. Where necessary, the Buyer may eliminate the defects themselves at the Seller’s expenses. If the Seller fails to reply within one month after receipt of the aforesaid claim, the claim shall be reckoned as having been accepted by the Seller.

15. Force Majeure

The Seller shall not be held responsible for delay in shipment or non-delivery of the goods due to Force Majeure, which might occur during the process of manufacturing or in the course of loading. The Seller shall advise the Buyer of the occurrence mentioned above within 15 (fifteen) days and send by airmail a certificate of the incident issued by the local government to the Buyer. Even in such cases, the Seller is still liable to take all possible measures to expedite the delivery of goods.

Should the Seller fail to perform the contracted obligations 10 (ten) weeks after the aforesaid incident, the Buyer shall have the right to treat the contract as null and void.

16. Late delivery and penalty

Should the Seller fail to make delivery within the contracted period for reasons other than Force Majeure specified in Clause 15 hereof, the Buyer may accept the postponement on condition that the Seller agrees to pay a penalty which shall be deducted by the paying bank from the agreed amount of payment. The penalty, however, shall not exceed 5% (five percent) of the total value of the goods involved in the late delivery. The rate of penalty is charged at 0.5% (zero point five percent) for every seven days, odd days less than seven days should be counted as seven days. Incase the Seller fails to make delivery ten weeks later than the shipment stipulated in the contract. The Seller, in spite of the cancellation, shall still pay the aforesaid penalty to the Buyer without delay.

17. Arbitration

All disputes in connection with this contract or the execution thereof shall be settled through friendly consultations. Should no settlement be reached, the case may then be submitted for arbitration to the Foreign Economic and Trade Arbitration Commission of the CCPIT in accordance with the rules and procedures of the said Arbitration Commission. The arbitration shall take place in 15 (fifteen) days. The decision of the Arbitration Commission shall be final and binding on both Parties. The arbitration fee shall be borne by the losing Party. The arbitration may also be settled in a third country mutually agreed upon by both Parties.

18. Special provisions

In witness thereof, this contract is signed by both Parties in tow original copies; each Party shall keep one copy.

The Buyer: The Seller:

(Signature) (Signature)

Date: Date: