Technology Sharing Agreement for Dietary Supplement Products between Tianjin Tianshi Biological Development Co., Ltd. and Tianjin Tianshi Biological Engineering Ltd.

Summary

This agreement, dated October 26, 2005, is between Tianjin Tianshi Biological Development Co., Ltd. (Party A) and Tianjin Tianshi Biological Engineering Ltd. (Party B). Party A agrees to share ownership of the manufacturing technology for 10 dietary supplement products with Party B. Party B will pay Party A a one-time fee, and both parties will jointly own and use the technology, but cannot transfer it to third parties without mutual consent. The agreement outlines payment terms, technology transfer procedures, confidentiality obligations, and joint ownership of any new developments based on the shared technology.

EX-10.2 3 tiens10qex102093005.txt TECHNOLOGY SHARING AGREEMENT Exhibit 10.2 TECHNOLOGY SHARING AGREEMENT OF DIETARY SUPPLEMENT PRODUCTS This Agreement has been entered into as of October 26, 2005 in Wuqing New Tech Industrial Park, Tianjin, and P.R.C. by the following Parties: Assignor: Tianjin Tianshi Biological Development Co.,Ltd.( Hereinafter " Party A") Legal Registered Office: Wuqing New Tech Industrial Park, Tianjin, P.R.C. Legal Person: LI,JINYUAN Assignee: Tianjin Tianshi Biological Engineering Ltd.( called Party B below) Legal Registered Office: No.6, Yuanquan Rd. Wuqing New Tech Industrial Park, Tianjin, P.R.C Legal Person: LI,JINYUAN Whereas Party A holds the ownership of 10 dietary supplement products and relevant manufacture technology; and agrees to change the sole ownership into sharing ownership by Party A and Party B; and Whereas Party B has long term cooperation relationship with Party A, and Party B is responsible for sales and marketing of such 10 dietary supplement products in China for a long time. Party B agrees to share with Party A the above ownership of manufacture technology of 10 dietary supplement products. Therefore, with regard to the above ownership of manufacturing technology of 10 dietary supplement products, in consideration of reinforcing the cooperation between the two Parties and achieving the maximized economical benefits and returns for both sides, Party A and Party B hereto agree as follows: 1. CHANGING OF OWNERSHIP 1.1 Party A agrees to change the ownership of manufacturing technology of 10 dietary supplement products, which is wholly owned and indicated in Appendix 1. After changing, Party A and Party B hold the above ownership of manufacturing technology of 10 dietary supplement products together. 1.2 Party B agrees the above changing of ownership of manufacturing technology of 10 dietary supplement products, and agrees to share with Party A the above ownership and usufruct of manufacturing technology of 10 dietary supplement products. 1.3 Party A and Party B shall hold the changed ownership of manufacture technology together and both Parties shall take the right as the owners of 10 dietary supplement products, such as Super Calcium Powder, etc., and bear the relevant obligations. Either of Party A or Party B has the right to use the manufacture technology of 10 dietary supplement products solely and under no restriction to produce, manufacture and sell the 10 dietary supplement products according with the requirements of manufacture technology of 10 dietary supplement products and relevant laws. 1.4 Both Parties agree that either of two Parties is not allowed to transfer the ownership to the third party after the sole ownership of 10 dietary supplement products changes into sharing ownership by two Parties. 2. THE BUSINESS SCOPE AFTER TRANSFERRING 2.1 After the transferring of the manufacture technology of 10 dietary supplement products, such as Super Calcium Powder, both Party A and Party B shall employ the technology within the business scope prescribed by regulations and laws of the State. 2.2 Either Party A or Party B, who breaches the faith, shall bear the relevant results of employing the manufacture technology of 10 dietary supplement products beyond the promised business scope or against the laws. 3. COSTS FOR CHANGE 3.1 Both Parties come to the agreement that the costs for the change of the ownership of the production technologies for the above 10 dietary nutrition supplements should be pursuant to the "Market Evaluation Report" from the Nutrition Supplements Market Committee of the China Healthcare Association. 3.2 Both Parties come to the agreement that the change of the ownership of the production technologies for the above 10 dietary nutrition supplements aims at the reinforcement of bilateral cooperation and the realization of economic benefits and returns satisfactory for both sides, and the transaction price should be in accordance with what is confirmed in the "Market Evaluation Report" from the Nutrition Supplements Market Committee of the China Healthcare Association: Party B makes an one time payment of 1,398,912 RMB to Party A as the transfer price. 3.3 Any cost charged in the process of the ownership change will be charged to Party A. 4. WAYS OF PAYMENTS Party B shall make the payment to Party A in accordance with the following deadlines upon receiving the invoices from Party A: 4.1 Make a deposit equal to 20% of the total price upon the Agreement is signed, which is 279,782.4 RMB. 4.2 Party B should pay the rest 1,119,129.6 RMB within 7 days after Party A delivers all the technologic documents for the 10 dietary nutrition supplements. 4.3 Both Parties unanimously agree to pay by (1) cash, (2) check (3) remittance Payment by remittance by Party B should be remitted to the designated account of Party A: Account Number: Name of the Bank: 5. TECHNOLOGY TRANSFER 5.1 Party A shall transfer all the technologic documents, including but not limited to products formulations, production techniques, quality standard etc. to Party B, in order for Party B to employ the manufacturing technology for the 10 dietary nutrition supplements in manufacturing smoothly. 5.2 Party A should deliver the technologic documents to Party B within 7 working days after the Agreement is signed and Party B receives all the municipal ratifications for food manufacturing enterprises. 5.3 After the delivery of the technologic documents to Party B, Party A should still bear the responsibility to instruct Party B to test, try out and produce until Party B can produce the first qualified products, but Party A does not bear the financial responsibility attainable for Party B. 5.4 The specific technology for the 10 dietary nutrition supplements is jointly owned by Party A and Party B after the technology sharing. Each Party is not allowed to transfer the specific technology to any third party without the written permission of the other party. Besides, without any restrictions, each Party in its own name has the authority to employ the 10 specific technologies to manufacture, produce and sell products complying with the State standard. 5.5 Any newly-exploited technical products basing on the 10 specific technologies from either Party after the technology sharing should belong to both Parties. 5.6 After the technology sharing, both Parties should keep the technology under secret conditions and are not allowed to disclose to any third party. Otherwise, it shall bear the breach responsibility and repay the other party for the losses. 6 TESTING STANDARDS AND TESTING MANNERS FOR THE TECHNOLOGY TRANSFER 6.1 Testing Standards: in accordance with the national or industrial standards. If no national or industrial standards, in accordance with the technologic parameters promised to achieve by Party A. 6.2 Testing manners: Party B receives the technologic documents from Party A, fully understands the content, and signs for confirmation. 7. DOCUMENT DELIVERY 7.1 The relevant technologic documents and letters, required by the Agreement, shall be drafted in Chinese and delivered by specific personnel or fax; 7.2 All the documents for delivery shall be regarded to have been delivered according to the following date, whichever happens first: o If delivered by specific personnel, the date when they are arrived; o If delivered by fax, the date when the return receipt is confirmed. 8. REPRESENTATIONS AND WARRANTIES 8.1 Party A and Party B each respectively represents and warrants that it has the authority and capacity to enter into and execute this Agreement. The two Parties have hereto signed this Agreement by their duly authorized officers and representatives. The execution and performance of this Agreement does not cause to be in breach of any Agreement to the third party, or cause the other party to be liable for any responsibility to any third party as a result of the performance of this Agreement. 8.2 Party A represents and warrants that it owns the entire intellectual right and technology material prior to such Agreement. It guarantees that the conclusion of the Agreement does not infringe the any third party's technical rights and interests. Party A shall be responsible for dealing with any legal issues which may incur and bear any costs and liabilities in connection with the performance of this Agreement. 8.3 Party A guarantees Party B that the technical material which is transferred to Party B is the most recent. It guarantees that the material is complete, properly drafted, and reliable. Party A shall transfer the material to party B in accordance with the rules hereinto. 8.4 Party B guarantees that it has acquired or shall acquire the production license, healthy certification, and guarantees that it meets all the necessary requirements for producing and manufacturing wellness products. 8.5 Party B guarantees that after the effect of this Agreement it produces and manufactures in accordance with the original formulation, quality standard, production techniques of the ten dietary supplement products and in compliance with national laws and regulations. Party B is responsible for any economic losses suffered by itself as a result of Party B's breaching the above articles under this Agreement. And Party B shall reimburse Party A any economic losses, directly or indirectly suffered by Party A arising out of or in connection with Party B's default. 9. LIABILITY FOR BREACH OF THE AGREEMENT 9.1 If Party A does not provide the technical materials and guidance on tests, trial, and production to Party B in accordance with the time, quantity, quality provisions stipulated hereinabove, Party A shall pay Party B penalty equal to the sum of 5% of technology transfer fee. 9.2 If Party A transfers such technology to any third party without prior approval by Party B, it shall pay Party B penalty equal to the sum of 5% of technology transfer fee. 9.3 In the event that there is any technical error for the transferred technology Party A shall make corrections and improve the quality promptly. If such improvement still cannot reach the production standard, Party A shall pay Party B penalty equal to the sum of 5% of technology transfer fee, and moreover, reimburse Party B any losses incurred arising out of or in connection therewith. 9.4 If Party B does not pay transfer fee to Party A in accordance with the time and amount stipulated by this Agreement, Party B shall pay penalty to Party A subject to the bank's rules with respect to deferring payment. 10. CHANGES AND DISSOLUTION OF THE AGREEMENT 10.1 Without any reasonable cause either party shall not change or terminate this Agreement. 10.2 In the case of failure to complete the ownership transfer procedures of Wellness Products Certificate as a result of the change of national policy after the conclusion of this Agreement, both parties shall have the right to terminate this Agreement. In such case, both parties shall not bear responsibilities for default and suffer the losses arising out of this by themselves respectively. 11 GOVERNING LAW AND SETTLEMENT OF DISPUTE 11.1 The conclusion, validity, interpretation, implementation, amendments, termination and settlement of dispute arising out of or in connection with this Agreement shall be governed by the laws of the PRC. 11.2 The two Parties hereto shall make all reasonable efforts to solve any dispute arising out of the implementation of this Agreement through friendly consultation. In case no settlement can be reached through consultation, the court where Party A is located shall have jurisdiction to hear and determine the suit subject to this written Agreement. 12 OTHERS 12.1 A supplemental Agreement shall be signed separately thereafter by both parties if some other items are to be covered. 12.2 The changed parts, if there are any, shall be invalid unless they are properly sealed and validated by both parties. 12.3 If any provision of this Agreement or part thereof is rendered void or unenforceable, it shall not affect in any way the validity or enforceability of any other provision of this Agreement. 12.4 The Agreement shall take effect after both parties have affixed their respective seals under the hands of their respective officers duly authorized in that behalf. In the event that a notarization is needed, the Agreement shall become effective after it is notarized by public notarial authority. This Agreement shall be executed in eight originals. Each party holds one copy and others will be submitted to the authorized governmental department in the course of proceeding the transfer application procedures. IN WITNESS WHEREOF this Agreement has been entered into the day and year first above written. PARTY A: TIANJIN TIANSHI BIOLOGICAL DEVELOPMENT CO., LTD. SIGNED BY /s/ Jinyuan Li ----------------------------------------------------------------------- DATE October 26, 2005 ---------------------------------------------------------------------------- CONTACT Fusen Han ------------------------------------------------------------------------- TEL 0086-22-82137186 ----------------------------------------------------------------------------- FAX 0086-22-82133481 ----------------------------------------------------------------------------- ADD. No. 6, Yuanquan Road, Wuqing New-tech Industrial Park, Tianjin, P.R. China ---------------------------------------------------------------------------- PARTY B: TIANJIN TIANSHI BIOLOGICAL ENGINEERING CO., LTD. SIGNED BY /s/ Jinyuan Li ----------------------------------------------------------------------- DATE October 26, 2005 ---------------------------------------------------------------------------- CONTACT Fusen Han ------------------------------------------------------------------------- TEL 0086-22-82137186 ----------------------------------------------------------------------------- FAX 0086-22-82133481 ----------------------------------------------------------------------------- ADD. No. 6, Yuanquan Road, Wuqing New-tech Industrial Park, Tianjin, P.R. China ----------------------------------------------------------------------------