Guaranty Contract of Maximum Amount

The Guarantor undertakes to provide guaranty for the indebtedness owed by the Obligor to the Creditor derived from the agreed operations from June 8, 2007 to May 23, 2008. The balance of the aforesaid indebtedness shall not exceed RMB Eight Hundred Million yuan and indebtedness in foreign currency shall be calculated according to the selling price on the date of the operation. The mature date of the aforesaid indebtedness shall not exceed May 23, 2009. The abovementioned operations include: Loan in RMB/Foreign Currency; Issuance of L/C without or with reduced of deposit; exporter’s packing loan; discount of bank/commercial draft; inward documentary bill; outward documentary bill; bank guarantee; acceptance of bank draft.

The Obligor is entitled to apply for revolving utilization of the abovementioned bank credit facilities within the term and under the maximum amount as stipulated in this Contract. The beginning date, mature date, interest rate and amount of each indebtedness shall be determined by the loan certificate or relevant credit certificate under the Loan Agreements.

The Parties do not need to enter into individual guaranty arrangement for each of the bank loan or bank facility granted by the Creditor within the term and under the maximum amount as stipulated in this Contract.

The operations may be carried out in any currency and the Guarantor’s guaranty is for the indebtedness in the original currency.

The guaranty period under this Contract shall be two years from the expiry date for the indebtedness of the Obligor under the Loan Agreements.

he/she shall provide truthful, comprehensive and effective financial reports and other relevant materials and information to the Creditor;

2.

he/she shall perform the obligation of guaranty voluntarily in case of default by the Obligor;

3.

in case that the Guarantor fails to perform his/her obligation of guaranty in accordance with this Contract, the Creditor is entitled to transfer directly the relevant amount of deposit from any account of the Guarantor to the Creditor’s account.

4.

he/she shall notify the Creditor in writing within 5 days upon the occurrence of the following events:

(1)

The shareholder, senior management, articles of association or corporate governance structure of the Guarantor has been altered;

(2)

The Guarantor ceases its business operation or its business license has been withdrawn or cancelled;

 

(3)

The Guarantor’s financial status deteriorates or its business operation encounters serious difficulty or it is involved in major litigation or arbitration;

(4)

The Guarantor changes its name, address, legal representative, contact information etc.

(5)

Any other events of the Guarantor that may make the Creditor unable to execute its creditor’s right.

5.

The Guarantor shall give 15-day prior written notification to the Creditor and obtain the Creditor’s consent before it takes any of the following actions:

(1)

The Guarantor changes its capital structure or management system, which includes (without limitation) contractual management, lease, share structure transformation, joint venture, merger, acquisition, division, application for cease of business operation, application for dissolution, application for bankruptcy etc.

(2)

The Guarantor provide guaranty for any other third party or establish mortgage or pledge on its major assets for the benefit of any other third party which may affect its performance of obligation of guaranty under this Contract.

6.

In case that the Obligor provides collateral to secure its indebtedness, the Guarantor undertakes that he/she shall perform the obligation of guaranty prior to the execution of the collateral.

7.

In case that the Obligor and Guarantor breach their obligations under the Loan Agreement or this Contract, the Creditor is entitled to declare that the indebtedness of the Obligor all become mature and demand the Guarantor to perform his/her obligation of guaranty of joint and several liability in accordance with this Contract.

1.

The Guarantor shall find out on his/her own initiative the business status of the Obligor and occurrence and performance of the operations under this Contract. The Loan Agreement, loan certificate or relevant credit certificate for the operations under this Contract will not sent to the Guarantor separately.

2.

This Contract is to secure the indebtedness under the Comprehensive Credit Facility Agreement of Maximum Amount (reference no. 81001200713170001) entered into by the Obligor and Creditor.