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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>UNITED
        STATES</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>SECURITIES
        AND EXCHANGE COMMISSION</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Washington,
        D.C. 20549</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">_____________________________</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>FORM
        8-K</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>CURRENT
        REPORT</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>PURSUANT
        TO SECTION 13 OR 15(d) OF THE</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SECURITIES
        EXCHANGE ACT OF 1934</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date
        of
        Report:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Date
        of
        earliest event reported)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>July
        15, 2005</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>____________________________</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>Purezza
        Group, Inc.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Exact
        name of registrant as specified in its charter)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Florida</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(State
        or
        other Jurisdiction of Incorporation or Organization)</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div>
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            <tr>
              <td valign="top" width="27%">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>333-85306</strong></font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Commission
                  File Number)</font></div>
              </td>
              <td valign="top" width="23%">&#160;</td>
              <td valign="top" width="23%">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>65-1129912</strong></font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(IRS
                  Employer Identification No.)</font></div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="27%">&#160;</td>
              <td valign="top" width="23%">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>426
                  Xuefu Street, Taiyuan, Shanxi Province, China</strong></font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Address
                  of Principal Executive Offices and zip code)</font></div>
              </td>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>86
        351 2281300</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Registrant's
        telephone </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">number,
        including area code)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>936A
        Beachland Boulevard, Suite 13</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Vero
        Beach, FL 32963</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Former
        Name or Former Address, if Changed Since Last Report)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Check
        the
        appropriate box below if the Form 8-K filing is intended to simultaneously
        satisfy the filing obligation of registrant under any of the following
        provisions:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">[
        &#160;]
        Written communications pursuant to Rule 425 under the Securities Act (17
        CFR
        230.425)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">[&#160;
        ]
        Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17
        CFR
        240.14a-12(b)) </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">[&#160;
        ]
        Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
        Act
        (17 CFR 240.14d-2(b))</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">[&#160;
        ]
        Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
        Act
        (17 CFR 240.13e-4(c))</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>Safe
        Harbor Statement under the Private Securities Litigation Reform Act of
        1995</u></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Information
        included in this Form 8-K may contain forward-looking statements within the
        meaning of Section 27A of the Securities Act and Section 21E of the Securities
        Exchange Act of 1934, as amended (the "Exchange Act"). This information may
        involve known and unknown risks, uncertainties and other factors which may
        cause
        the actual results, performance or achievements of Purezza Group, Inc.
        (&#8220;Purezza&#8221;) and Shanxi Puda Resources Co, Ltd. (&#8220;Puda&#8221;) to be materially
        different from future results, performance or achievements expressed or implied
        by any forward-looking statements. Forward-looking statements, which involve
        assumptions and describe the Purezza's and Puda&#8217;s future plans, strategies and
        expectations, are generally identifiable by use of the words "may," "should,"
        "expect," "anticipate," "estimate," "believe," "intend" or "project" or the
        negative of these words or other variations on these words or comparable
        terminology. Forward-looking statements are based on assumptions that may
        be
        incorrect, and there can be no assurance that any projections or other
        expectations included in any forward-looking statements will come to pass.
        Purezza's and Puda&#8217;s actual results could differ materially from those expressed
        or implied by the forward-looking statements as a result of various factors.
        Except as required by applicable laws, Purezza undertakes no obligation to
        update publicly any forward-looking statements for any reason, even if new
        information becomes available or other events occur in the future.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Section
        1 - Registrants&#8217; Business and Operations</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        1.01 Entry into a Material Definitive Agreement.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Reference
        is made to the disclosure set forth under Items 2.01 and 8.01 of this Current
        Report on Form 8-K, which disclosure is incorporated herein by
        reference.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
        June
        24, 2005, Taiyuan Putai Business Consulting Co., Ltd. (&#8220;Putai&#8221;), a limited
        liability company under the Company Law of The People&#8217;s Republic of China (the
&#8220;PRC&#8221;) and Shanxi Puda Resources Co, Ltd. (&#8220;Puda&#8221;), a limited liability company
        formed by natural persons under the laws of the PRC, entered into an Exclusive
        Consulting Agreement, (&#8220;Consulting Agreement&#8221;), an Operating Agreement,
        (&#8220;Operating Agreement&#8221;), and a Technology License Agreement, (&#8220;License
        Agreement&#8221;) (collectively, theses agreements are referred to herein as the
&#8220;Restructuring Agreements&#8221;). Under the Restructuring Agreements, Putai has
        agreed to advise, consult, manage and operate Puda&#8217;s business, to provide
        certain financial accommodations to Puda, and to license certain technology
        to
        Puda for use in its business, in exchange for Puda&#8217;s payment of all of its
        Operating Cash Flow (as defined in the Restructuring Agreements) to Putai.
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Each
        of
        the holders of the registered capital of Puda also granted Putai the exclusive
        right and option to acquire all of their registered capital of Puda (&#8220;Option
        Agreement&#8221;) and further authorized Putai to vote at any meeting or action of the
        owners of the registered capital of Puda and to act as the representative
        for
        such holders in all matters respecting Puda&#8217;s registered capital
        (&#8220;Authorizations&#8221;). </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        Restructuring Agreements, Option Agreement and Authorizations are included
        as
        Exhibits 10.1 through 10.6 to this Report, and are hereby incorporated by
        this
        reference.</font></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-2-</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
        a
        result of the closing of the exchange transaction described below, Puda
        Investment Holding Limited (&#8220;Puda BVI&#8221;), an International Business Company
        incorporated in the British Virgin Islands, became a wholly-owned subsidiary
        of
        Purezza. Puda BVI, in turn, owns all of the registered capital of Putai,
        a
        wholly foreign owned enterprise (&#8220;WFOE&#8221;) registered under the wholly
        foreign-owned enterprises laws of the PRC. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Section
        2 - Financial Information</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        2.01 Completion of Acquisition or Disposition of Assets.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
        June 20, 2005, Purezza Group, Inc., a Florida corporation ("Purezza"), entered
        into an Exchange Agreement (&#8220;Exchange Agreement&#8221;) with Taiyuan Putai Business
        Consulting Co., Ltd. (&#8220;Putai&#8221;), a limited liability company under the Company
        Law of The People&#8217;s Republic of China (the &#8220;PRC&#8221;), Shanxi Puda Resources Co,
        Ltd. (&#8220;Puda&#8221;), a limited liability company formed by natural persons under the
        laws of the PRC, Puda Investment Holding Limited (&#8220;Puda BVI&#8221;), an International
        Business Company incorporated in the British Virgin Islands, and each of
        the
        members of Puda BVI (the &#8220;Puda BVI Members&#8221;). The closing of the transactions
        contemplated by the Exchange Agreement (the &#8220;Closing&#8221;) occurred on July 15,
        2005. At the Closing, pursuant to the terms of the Exchange Agreement, Purezza
        acquired all of the outstanding capital stock and ownership interests of
        Puda
        BVI (the &#8220;Interests&#8221;) from the Puda BVI Members, and the Puda BVI Members
        contributed all of their Interests in Puda BVI to Purezza. In exchange, Purezza
        issued to the Puda BVI Members 1,000,000 shares of Series A Convertible
        Preferred Stock, par value $0.01 per share, of Purezza ("Preferred Shares"),
        which are convertible into 678,500,000 shares of Purezza&#8217;s common stock
        (&#8220;Conversion Shares&#8221;). The issuance of the Preferred Shares and, upon
        conversion, the shares of Purezza common stock underlying the Preferred Shares,
        to the Puda BVI Members is intended to be exempt from registration under
        the
        Securities Act of 1933, as amended (the &#8220;Securities Act&#8221;), pursuant to Section
        4(2) thereof. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">At
        the
        Closing, Puda BVI became a wholly-owned subsidiary of Purezza. Puda BVI,
        in
        turn, owns all of the registered capital of Putai, a wholly foreign owned
        enterprise (&#8220;WFOE&#8221;) registered under the wholly foreign-owned enterprises laws
        of the PRC.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
        July
        18, 2005, Purezza filed a press release announcing the Closing, a copy of
        which
        is attached to this Current Report on Form 8-K as Exhibit 99.1. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Except
        for the Exchange Agreement and the transactions contemplated by that agreement,
        neither Purezza, nor its directors and officers, had any material relationship
        with Puda BVI, any of the Members of Puda BVI, Puda or Putai.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Purezza
        is presently authorized under its Articles of Incorporation to issue 100,000,000
        shares of common stock, par value $0.001 per share, and 5,000,000 shares
        of
        preferred stock, par value $0.01 per share. Of the 5,000,000 shares of preferred
        stock authorized, 1,100,000 shares will be designated as Series A Convertible
        Preferred Stock pursuant to a certificate of designations (&#8220;Certificate of
        Designations&#8221;), which was approved by Purezza&#8217;s board of directors, and filed
        with and accepted by, the Secretary of State of the State of Florida prior
        to
        the Closing. As of the Closing, Purezza had 59,000,000 shares of common stock
        issued and outstanding and no shares of preferred stock issued and outstanding.
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-3-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under
        the
        terms of the Exchange Agreement, all of the outstanding Interests of Puda
        BVI
        will be exchanged for 1,000,000 Preferred Shares of Purezza. Each Preferred
        Share will be convertible into 678.5 shares of Purezza&#8217;s common stock (the
&#8220;Conversion Rate&#8221;). The Preferred Shares will immediately and automatically be
        converted into shares of Purezza&#8217;s common stock (the &#8220;Mandatory Conversion&#8221;)
        upon the approval by a majority of Purezza&#8217;s stockholders (voting together on an
        as-converted-to-common-stock basis), following the exchange transaction,
        of an
        increase in the number of authorized shares of Purezza&#8217;s common stock from
        100,000,000 to 150,000,000, and a 1 for 10 reverse stock split of Purezza&#8217;s
        outstanding common stock (&#8220;Reverse Split&#8221;). The Conversion Rate will be adjusted
        downward to account for the Reverse Split.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        holders of shares of Series A Preferred Stock will be entitled to vote together
        with the holders of the common stock, as a single class, upon all matters
        submitted to holders of common stock for a vote. </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Each
        share of Series A Preferred Stock will carry a number of votes equal to the
        number of shares of common stock issuable in a Mandatory Conversion based
        on the
        then applicable Conversion Rate. As such, i</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">mmediately
        following the Closing, the Puda BVI Members owned 92% of the total combined
        voting power of all classes of Purezza&#8217;s outstanding stock entitled to
        vote.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Upon
        Mandatory Conversion of the Preferred Shares, and subject to an adjustment
        of
        the Conversion Rate as a result of the Reverse Split, the Puda BVI Members
        will,
        in the aggregate, receive approximately 67,850,000 shares of Purezza&#8217;s common
        stock, representing 92% of the outstanding shares of Purezza&#8217;s common stock
        immediately following the Mandatory Conversion. The existing stockholders
        of
        Purezza will, following the Mandatory Conversion and Reverse Split, own
        approximately 5,900,000 shares of Purezza&#8217;s common stock, representing 8% of the
        outstanding shares of common stock. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accordingly,
        if the Mandatory Conversion and the Reverse Split occurred as of the date
        of
        this Report, Purezza&#8217;s currently issued and outstanding Series A Convertible
        Preferred Stock (currently 1,000,000 shares) and common stock (currently
        59,000,000 shares) would be converted into 67,850,000 and 5,900,000 shares
        of
        common stock, respectively, and would represent 92% and 8%, respectively,
        of
        Purezza&#8217;s total common stock issued and outstanding.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
        connection with the Reverse Split, Purezza&#8217;s board of directors may, in its
        discretion, provide special treatment to certain Purezza stockholders to
        preserve round lot holders (i.e., holders owning at least 100 shares) after
        the
        Reverse Split. In the event Purezza&#8217;s board determines to provide such special
        treatment, Purezza stockholders holding 1,000 or fewer shares of common stock
        but at least 100 shares of common stock will receive 100 shares of common
        stock
        after the Reverse Split, and persons holding less than 100 shares of common
        stock would not be affected. The terms and conditions of special treatment
        afforded to Purezza stockholders to preserve round lot stockholders, if any,
        including the record dates for determining which stockholders may be eligible
        for such special treatment, will be established in the discretion of Purezza&#8217;s
        board of directors. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-4-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
        as of the Closing, the existing director of Purezza resigned, and the following
        directors of Purezza were appointed: </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div align="left">
        <table border="0" cellpadding="0" cellspacing="0" width="100%">

            <tr bgcolor="#ffffff">
              <td valign="top" width="22%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Name</strong></font></div>
              </td>
              <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Age</strong></font></div>
              </td>
              <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td valign="top" width="48%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Position</strong></font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                  Ming </font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">34</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chairman
                  of the Board</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Wang
                  Lisheng</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">41</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Director
                  designated by Zhao Ming</font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Rachel
                  Li</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">37</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Director
                  designated by Keating Reverse Merger Fund, LLC</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="top" width="22%">&#160;</td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%">&#160;</td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Also
        effective as of the Closing, the existing officers of Purezza resigned, and
        the
        following officers were appointed by the newly constituted Board of
        Directors:</font></div>
      <div align="left">
        <table border="0" cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td valign="top" width="22%">&#160;</td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%">&#160;</td>
              <td width="1%">&#160;</td>
              <td valign="top" width="48%">&#160;</td>
            </tr>
            <tr bgcolor="#ffffff">
              <td valign="top" width="22%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Name</strong></font></div>
              </td>
              <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Age</strong></font></div>
              </td>
              <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td valign="top" width="48%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Position</strong></font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                  Ming</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">34</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chief
                  Executive Officer and President</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                  Yao </font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">46</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chief
                  Operating Officer</font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Jin
                  Xia</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">40</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chief
                  Financial Officer </font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="top" width="22%">&#160;</td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%">&#160;</td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
        as of the Closing, Kevin R. Keating resigned as sole director of Purezza
        and as
        the President, Secretary and Treasurer. Pursuant to the Exchange Agreement
        and a
        certain Voting Agreement among the Puda BVI Members and Keating Reverse Merger
        Fund, LLC (&#8220;KRM Fund&#8221;) (the &#8220;Voting Agreement&#8221;), effective as of the Closing,
        KRM Fund and each Puda BVI Member have agreed to vote their shares of Purezza&#8217;s
        common stock to (i) elect a person designated by the KRM Fund (the &#8220;KRM
        Designate&#8221;) from time to time to Purezza&#8217;s board for a period of one year
        following the Closing, (ii) elect such other persons that may be designated
        by
        Zhao Ming from time to time to fill any vacant position on the board of
        directors (other than KRM Designate), and (iii) approve the Reverse Split,
        an
        increase in Purezza&#8217;s authorized common stock from 100,000,000 to 150,000,000,
        and a corporate name change. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">At
        the
        Closing, Purezza entered into a financial advisory agreement with Keating
        Securities, LLC (&#8220;Keating Securities&#8221;), a registered broker-dealer, pursuant to
        which Keating Securities was compensated by Purezza for its advisory services
        rendered to Purezza in connection with the exchange transaction. The transaction
        advisory fee was $400,000, which fee was paid at Closing. The financial advisory
        agreement also appoints Keating securities as Purezza&#8217;s exclusive placement
        agent and underwriter for private and public offerings of Purezza&#8217;s securities
        for a one year period following Closing. The financial advisory agreement
        is
        attached as Exhibit 10.7 to this Current Report on Form 8-K, and is incorporated
        herein by reference. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Kevin
        R.
        Keating, Purezza&#8217;s sole officer and director prior to the exchange transaction,
        is the father of the principal member of Keating Investments, LLC. Keating
        Investments, LLC is the managing member of KRM Fund, which was the majority
        stockholder of Purezza prior to the exchange transaction, and Keating
        Securities, LLC, the registered broker-dealer affiliate of Keating Investments,
        LLC. Kevin R. Keating is not affiliated with and has no equity interest in
        Keating Investments, LLC, KRM Fund or Keating Securities, LLC and disclaims
        any
        beneficial interest in the shares of Purezza&#8217;s common stock owned by KRM Fund.
        Similarly, Keating Investments, LLC, KRM Fund and Keating Securities, LLC
        disclaim any beneficial interest in the shares of Purezza&#8217;s common stock
        currently owned by Kevin R. Keating.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-5-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
        September 27, 2004, in its Current Report on Form 8-K dated September 24,
        2004,
        Purezza reported the execution of a letter of intent to acquire Puda. On
        June
        24, 2005, in its Current Report on Form 8-K dated June 20, 2005, Purezza
        reported the execution of the Exchange Agreement and included a copy of the
        Exchange Agreement therein as Exhibit 2.1. These Current Reports are hereby
        incorporated by reference. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Section
        3 - Securities and Trading Markets</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        3.02 Unregistered Sales of Equity Securities.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Reference
        is made to the disclosure set forth under Item 2.01 of this Current Report
        on
        Form 8-K, which disclosure is incorporated herein by reference.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        issuance of the Preferred Shares and, upon conversion, the shares of Purezza
        common stock underlying the Preferred Shares, to the Puda BVI Members was
        exempt
        from registration under the Securities Act pursuant to Section 4(2) thereof
        and
        such other available exemptions. Purezza made this determination based on
        the
        representations of the Puda BVI Members which included, in pertinent part,
        that
        such members were &#8220;accredited investors&#8221; within the meaning of Rule 501 of
        Regulation D promulgated under the Securities Act, that such members were
        acquiring the Preferred Shares</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">,
        and the
        shares of Purezza&#8217;s common stock underlying the Preferred Shares,</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        for
        investment purposes for their own respective accounts and not as nominees
        or
        agents, and not with a view to the resale or distribution thereof, and that
        each
        member understood that the Preferred Shares, and the shares of Purezza&#8217;s common
        stock underlying the Preferred Shares, may not be sold or otherwise disposed
        of
        without registration under the Securities Act or an applicable exemption
        therefrom.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
        the
        event of any liquidation, dissolution or winding up of Purezza, the assets
        of
        Purezza available for distribution to shareholders will be distributed among
        the
        holders of Preferred Shares and the holders of any other class of equity
        securities of Purezza, including its common stock, pro rata, on an
        as-converted-to-common-stock basis, after the payment to the holders of
        Preferred Shares of a di minimus stated value amount. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        holders of Preferred Shares are entitled to dividends in the event that Purezza
        pays cash or other dividends in property to holders of outstanding shares
        of its
        common stock, which dividends would be made pro rata, on an
        as-converted-to-common-stock basis.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        Conversion Rate applicable to the Preferred Shares is subject to adjustment
        from
        time to time in the event of any stock dividend, stock split, reverse stock
        split, reorganization or other corporate event affecting the outstanding
        capital
        stock of Purezza (including the Reverse Split).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
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          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-6-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
        any period in which the Preferred Shares are outstanding, Purezza is not
        permitted to, without first obtaining the approval (by vote or written consent,
        as provided by law) of the holders of at least a majority of the then
        outstanding Preferred Shares, voting as a separate class: </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">create
                  (by reclassification or otherwise) any new class or series of shares
                  having rights, preferences or privileges equal or senior to the
                  Series A
                  Convertible Preferred Stock. </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">directly
                  or indirectly, alter or change the rights, preferences or privileges
                  of
                  the Series A Convertible Preferred Stock.
</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">amend
                  Purezza&#8217;s Articles of Incorporation in a manner that materially adversely
                  affects the rights, preferences or privileges of the holders of
                  the Series
                  A Convertible Preferred Stock.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">increase
                  or decrease the authorized number of shares of preferred stock
                  of Purezza
                  as a whole;</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">liquidate
                  or wind-up Purezza; or</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">redeem,
                  purchase or otherwise acquire (or pay into or set funds aside for
                  a
                  sinking fund for such purpose) any share or shares of preferred
                  stock or
                  common stock; provided, however, that this restriction will not
                  apply to
                  the repurchase of shares of common stock from employees, officers,
                  directors, consultants or other persons performing services for
                  Purezza or
                  any subsidiary pursuant to agreements under which Purezza has the
                  option
                  to repurchase such shares at cost upon the occurrence of certain
                  events,
                  such as the termination of employment, or through the exercise
                  of any
                  right of first refusal.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Upon
        the
        occurrence of the Mandatory Conversion, or any other redemption or
        extinguishment of the Series A Convertible Preferred Stock, the shares
        converted, redeemed or extinguished will be automatically returned to the
        status
        of authorized and unissued shares of preferred stock, available for future
        designation and issuance pursuant to the terms of Purezza&#8217;s Articles of
        Incorporation.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Purezza&#8217;s
        Certificate of Designations, Preferences, Rights and Limitations of Series
        A
        Convertible Preferred Stock, as filed with the Secretary of State of the
        State
        of Florida, is attached as Exhibit 4.1 to this Current Report on Form 8-K,
        and
        is incorporated herein by reference.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        3.03 Material Modification to Rights of Security Holders</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Reference
        is made to the disclosure set forth under Items 2.01 and 3.02 of this Current
        Report on Form 8-K, which disclosure is incorporated herein by
        reference.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
        a
        result of the Closing and the issuance of the Preferred Shares</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">,
        the
        Puda BVI Members own 92% of the total combined voting power of all classes
        of
        Purezza stock entitled to vote.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Upon
        Mandatory Conversion of the Preferred Shares, and subject to an adjustment
        of
        the Conversion Rate as a result of the Reverse Split, the Puda BVI Members
        will,
        in the aggregate, receive approximately 67,850,000 shares of Purezza&#8217;s common
        stock, representing 92% of the outstanding shares of Purezza&#8217;s common stock
        immediately following the Mandatory Conversion. The existing stockholders
        of
        Purezza will, following the Mandatory Conversion and Reverse Split, own
        approximately 5,900,000 shares of Purezza&#8217;s common stock, representing 8% of the
        outstanding shares of common stock. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-7-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accordingly,
        if the Mandatory Conversion and the Reverse Split occurred as of the date
        of
        this Report, Purezza&#8217;s currently issued and outstanding Series A Convertible
        Preferred Stock (currently 1,000,000 shares) and common stock (currently
        59,000,000 shares) would be converted into 67,850,000 and 5,900,000 shares
        of
        common stock, respectively, and would represent 92% and 8%, respectively,
        of
        Purezza&#8217;s total common stock issued and outstanding.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Section
        5 - Corporate Governance and Management</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        5.01 Changes in Control of Registrant.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Reference
        is made to the disclosure set forth under Item 2.01 of this Current Report
        on
        Form 8-K, which disclosure is incorporated herein by reference.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        5.02 Departure of Directors or Principal Officers; Election of Directors;
        Appointment of Principal Officers.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Reference
        is made to the disclosure set forth under Item 2.01 of this Current Report
        on
        Form 8-K, which disclosure is incorporated herein by reference.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
        as of the Closing, Kevin R. Keating resigned as the prior sole director and
        officer of Purezza, and the following officers were appointed by the newly
        constituted Board of Directors:</font></div>
      <div align="left">
        <table border="0" cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td valign="top" width="22%">&#160;</td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%">&#160;</td>
              <td width="1%">&#160;</td>
              <td valign="top" width="48%">&#160;</td>
            </tr>
            <tr bgcolor="#ffffff">
              <td valign="top" width="22%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Name</strong></font></div>
              </td>
              <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Age</strong></font></div>
              </td>
              <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td valign="top" width="48%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Position</strong></font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                  Ming</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">34</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chief
                  Executive Officer and President</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                  Yao </font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">46</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chief
                  Operating Officer</font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Jin
                  Xia</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">40</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chief
                  Financial Officer </font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="top" width="22%">&#160;</td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%">&#160;</td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Zhao
        Ming</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        has been
        the CEO and Chairman of Puda since 1995. He was one of the co-founders of
        Puda.
        He also serves as an executive officer of Shanxi Liulin Jucai Coal Industry
        Co.,
        Limited, a coal mine which supplies raw coal to Puda. He had been the Vice
        President of Administration at the Fire Department of Taiyuan city from 1994
        to
        1997. Mr. Zhao graduated from Nanjing Armed Police Forces Command College
        of
        China in 1994 with a bachelor degree in management.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Zhao
        Yao</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        was one
        the co-founders of Puda. He was named Chief Operating Officer of Puda in
        1999,
        and he was appointed Vice President in June 1995. He also serves as an executive
        officer and is a 75</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%
        owner
        of Shanxi Liulin Jucai Coal Industry Co., Limited, a coal mine which supplies
        raw coal to Puda. He graduated from University of Shanxi in Taiyuan City,
        Shanxi
        Province in 1982 with a bachelor degree in coal study, and graduated from
        China&#8217;s Tsinghua University in Beijing in 1985 with a master degree in coal
        study. He published a coal resources research report in a national coal industry
        newspaper on July 9, 1985, and received close attention from industry experts.
        He is an contributor to the Chinese Hope Project for child education, and
        was
        awarded Shanxi&#8217;s Distinguished Entrepreneur award by Shanxi provincial
        government in 2002.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-8-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Jin
        Xia</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        joined
        Puda in 2003 as Chief Financial Officer. She also held financial manager
        positions in various entities during 2000 to 2003. She was the Financial
        Accountant at a local government agency in Xinhualing of Taiyuan City, Shanxi
        Province from 1991 to 1999. She served as an accountant at Xinhua Machinery
        Factory from 1987 to 1991. Ms. Jin graduated from Shanxi Finance and Economics
        College in China with an associate degree.</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
        Ming
        and Zhao Yao are brothers. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">None
        of
        the newly appointed executive officers have entered into an employment agreement
        with Purezza, Puda BVI, Putai or Puda. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">At
        the
        Closing, the following directors of Purezza were appointed: </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div align="left">
        <table border="0" cellpadding="0" cellspacing="0" width="100%">

            <tr bgcolor="#ffffff">
              <td valign="top" width="22%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Name</strong></font></div>
              </td>
              <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Age</strong></font></div>
              </td>
              <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td valign="top" width="48%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Position</strong></font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                  Ming </font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">34</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chairman
                  of the Board</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Wang
                  Lisheng</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">41</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Director
                  designated by Zhao Ming</font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="top" width="22%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Rachel
                  Li</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">37</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Director
                  designated by KRM Fund</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="top" width="22%">&#160;</td>
              <td width="1%">&#160;</td>
              <td valign="top" width="8%">&#160;</td>
              <td width="1%">&#160;</td>
              <td align="left" valign="top" width="48%">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Please
        see the biographies of Zhao Ming set forth above.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Wang
        Lisheng</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        became
        an independent director of Shanxi Puda Resources Co., Ltd. in October 2004.
        He
        has been a bank manager with the People&#8217;s Bank of China Taiyuan Branch since
        1986. &#160;The People&#8217;s Bank of China is the central bank in China. He
        graduated from Shanxi University in 1986 with a bachelor&#8217;s degree in management
        and economics.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Rachel
        Li</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        has been
        an investment portfolio manager since 2004 with Morningside Group, a private
        equity firm founded in Hong Kong that has investments in North America, Europe,
        and Asia Pacific.&#160; Ms. Li was a senior associate in healthcare investment
        banking with&#160;RBC Capital Markets (Royal Bank of Canada) in Menlo Park
        and
        San Francisco, California from 2001 to 2004. &#160;She was an auditor initially
        and later a senior auditor with PricewaterhouseCoopers, LLP in San Jose,
        California from 1999 to 2001. From 1997 to 1998, she was a scientist and
        senior
        scientist with a biotech company - QIAGEN Inc. in Los Angeles.&#160; Ms.
        Li was
        a research scientist with Chinese Academy of Medical Sciences from 1989 to
        1991.&#160; Ms. Li graduated from Cornell University with an MBA degree
        in
        1999.&#160; Previously she earned her Ph.D. degree in Biochemistry and
        Molecular
        Biology in 1996 from University of South Florida.&#160; She graduated from
        Beijing University in 1989 with a bachelors&#8217; degree in Plant Physiology and
        Biochemistry. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under
        the
        Voting Agreement, effective as of the Closing, KRM Fund and each Puda BVI
        Member
        have agreed to vote their shares of Purezza&#8217;s common stock to (i) elect the KRM
        Designate from time to time to Purezza&#8217;s board for a period of one year
        following the Closing, (ii) elect such other persons that may be designated
        by
        Zhao Ming from time to time to fill any vacant position on the board of
        directors (other than the KRM Designate), and (iii) approve the Reverse Split,
        an increase in Purezza&#8217;s authorized common stock from 100,000,000 to
        150,000,000, and a corporate name change. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-9-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">None
        of
        the newly appointed officers and directors, nor any of their affiliates,
        currently beneficially own any equity securities or rights to acquire any
        securities of Purezza except as otherwise described in this Report, and no
        such
        persons have been involved in any transaction with Purezza or any of its
        directors, executive officers or affiliates that is required to be disclosed
        pursuant to the rules and regulations of the Securities and Exchange Commission
        (the &#8220;SEC&#8221;), other than with respect to the transactions that have been
        described in this Report or in any prior reports filed by Purezza with the
        SEC.
        None of the newly appointed officers and directors have been convicted in
        a
        criminal proceeding, excluding traffic violations or similar misdemeanors,
        nor
        have they been a party to any judicial or administrative proceeding during
        the
        past five years, except for matters that were dismissed without sanction
        or
        settlement, that resulted in a judgment, decree or final order enjoining
        the
        person from future violations of, or prohibiting activities subject to, federal
        or state securities laws, or a finding of any violation of federal or state
        securities laws.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Until
        further determination by the Board, the full Board of Directors will undertake
        the duties of the Audit Committee, Compensation Committee and Nominating
        Committee of the Board of Directors.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
        Year.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
        as of the Closing, pursuant to the provisions of the bylaws of Purezza,
        applicable to all holders of capital stock, the Board of Directors of Purezza,
        by resolution increased the number of directors on the Board of Directors
        of
        Purezza from one to three.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Purezza&#8217;s
          Certificate of Designations, Preferences, Rights and Limitations of Series
          A
          Convertible Preferred Stock, as filed with the Secretary of State of Florida,
          is
          attached as Exhibit 4.1 to this Current Report on Form 8-K, and is incorporated
          herein by reference.</font></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Section
        8</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        8.01 Other Events.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Reference
        is made to the disclosure set forth under Items 1.01, 2.01, 3.02, 3.03, 5.01,
        5.02 and 5.03 of this Current Report on Form 8-K, which disclosure is
        incorporated herein by reference.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Business
        of Purezza</u></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prior
        to
        the Closing, Purezza was a public &#8220;shell&#8221; company with nominal assets whose sole
        business was to identify, evaluate and investigate various companies to acquire
        or with which to merge. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Business
        of Puda</u></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Overview</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
        to the Exchange Agreement, Purezza acquired 100% of the capital stock of
        Puda
        BVI, an international business company incorporated in the Territory of the
        British Virgin Islands on August 19, 2004. Puda BVI was organized by Zhao
        Ming
        and Zhao Yao, the executive officers and principal owners of Puda. Zhao Ming
        and
        Zhao Yao own approximately 80% and 20%, respectively, of the capital stock
        of
        Puda BVI. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-10-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Putai
        is
        organized as a limited liability company in the PRC. Putai was organized
        to be a
        wholly foreign owned enterprise (&#8220;WFOE&#8221;) and received its WFOE approval from the
        PRC government on October 18, 2004. Puda BVI is the sole owner
        of&#160;&#160;Putai.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
        June
        24, 2005, Putai and Puda entered into an Exclusive Consulting Agreement,
        (&#8220;Consulting Agreement&#8221;), an Operating Agreement, (&#8220;Operating Agreement&#8221;), and a
        Technology License Agreement, (&#8220;License Agreement&#8221;) (collectively, theses
        agreements are referred to herein as the &#8220;Restructuring Agreements&#8221;). Under the
        Restructuring Agreements, Putai has agreed to advise, consult, manage and
        operate Puda&#8217;s business, to provide certain financial accommodations to Puda,
        and to license certain technology to Puda for use in its business, in exchange
        for Puda&#8217;s payment of all of its Operating Cash Flow (as defined in the
        Restructuring Agreements) to Putai. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Each
        of
        the holders of the registered capital of Puda also granted Putai the exclusive
        right and option to acquire all of their registered capital of Puda (&#8220;Option
        Agreement&#8221;) and further authorized Putai to vote the registered capital of Puda
        and to act as the representative for such holders in all matters respecting
        Puda&#8217;s registered capital (&#8220;Authorizations&#8221;). </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        Restructuring Agreements, Option Agreement and Authorizations are included
        as
        Exhibits 10.1 through 10.6 to this Report, and are hereby incorporated by
        this
        reference.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Puda&#8217;s
        Coal Washing Business</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        is a
        limited liability company under the laws of the PRC and a domestic enterprise
        with exclusively domestic capital registered in Shanxi Province in the PRC.
        The
        registered capital of Puda is owned 80% by Zhao Ming and 20% by Zhao Yao.
        Puda
        received its business operating license on June 7, 1995 from the PRC government
        authorities. Puda is engaged in the business of coal crushing, preparation
        and
        cleaning in the PRC. The principal executive office of Puda is located at
        426
        Xuefu Street, Taiyuan, Shanxi Province, PRC. Zhao Ming and Zhao Yao are the
        executive officers of Puda.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        focuses on value added coal washing processes</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        and
        specializes in providing cleaned coal for primarily metallurgical purposes,
        such
        as steel making.</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        In the
        coal washing process, raw coal is cleaned by using Puda&#8217;s water-supported
        technology. The </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">cleaned
        coal produced by Puda is well suited for processing into coking coal, which
        is
        an essential raw material for steel production. </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Currently,
        Puda is one of the largest washed coal suppliers in Shanxi Province. Shanxi
        Province has the biggest coal reserves in China, and commands more than 20%
        of
        coal production in China.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Puda&#8217;s
        Coal Washing Facilities</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        has
        two coal washing facilities in Liulin County in Shanxi Province in the PRC.
        Liulin </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">County
        is
        renowned for the good quality of its coal. </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        two
        coal washing facilities are the:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0.4pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
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          </div>
        </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-11-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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        </div>
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          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0.4pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.
        </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Shanxi
        Liulin Jucai Plant </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">which
        has
        an annual clean coal washing capacity of 100,000 tons. This facility is located
        about two miles from the premises of coal mine owned and operated by Shanxi
        Liulin Jucai Coal Industry Co., Limited (&#8220;Jucai Coal&#8221;). Zhao Yao is a
        75</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%
        owner
        of Jucai Coal. Jucai Coal leases the coal processing facility to Puda. The
        leasing agreement was entered into on December 2, 2001 for a term of 5 years.
        The cost for the leased capacity is approximately $604,000 annually with
        four
        quarterly payments per year. </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0.4pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0.4pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.
        </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Shanxi
        Liulin Dongqiang Plant </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">which
        has
        an annual clean coal washing capacity of 400,000 tons. This facility is owned
        by
        Puda <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">and
        </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">has
        a
        land area of approximately 1.5 hectares, and is located about 120 miles
        southwest of Taiyuan City, the capital of Shanxi Province.</font></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Puda&#8217;s
        Technology</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        specializes in coal washing, processing and preparation utilizing a water
        supported jig washing technology. Puda facilities use these proprietary coal
        washing processes and technologies, to be licensed from Putai, and has its
        own
        wells as a water source for its coal washing </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">process.
        Together with the recycling of water from the coal washing system, the two
        plants have a sufficient and reliable supply of water for their
        operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Coal
        Washing Industry in China; Competition</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
        China,
        many coal mines do not have their own coal preparation facilities or have
        inadequate preparation capacities. Coal cleaning companies such as Puda were
        established to meet the demand for cleaned coal. The Chinese coal preparation
        industry is currently highly fragmented. Many coal washing plants have annual
        processing capacity of 100,000 tons or less. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        is
        the third largest coal washing company in Shanxi Province in terms of annual
        cleaned coal production. Taiyuan Coal Beneficiation Plant (a subsidiary of
        Xishan Coal &amp; Electricity Group, which is one of Puda&#8217;s current customers)
        is the largest coal washing company in Shanxi Province with coal washing
        capacity of 1.8 million tons per year. Another major local coal washing company
        in Shanxi Province is Shanxi Coking Company, which produces 1.6 million tons
        of
        cleaned coal per year. Puda&#8217;s major competitive advantage is its ability to
        access some of the highest quality raw coal in China and its well-established
        business relationship with local suppliers. However, with larger scale and
        sales, these competitors usually have better access to capital needed for
        further development.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">There
        are
        also many coal preparation plants located in the northeast China. However,
        due
        to lower quality of the raw coal in this region, these plants are less
        competitive in the cleaned coal market, especially in the coking coal market
        which serves the steel production industry.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0.4pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">High-grade
        cleaned coal production depends on high-grade raw coal inputs. Puda&#8217;s coal
        washing facilities are located in Liulin County of Shanxi Province, where
        top
        grades of coking coal reserves exist. The coal sourced from this area has
        been
        known as the &#8220;King of Coal&#8221; in China. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
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          </div>
        </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
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        </div>
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      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Puda&#8217;s
        Suppliers of Raw Coal</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        is
        not a coal mining operation and does not own any coal mines. Puda currently
        secures raw coal from a diversified pool of local Liulin County coal mines,
        including Liulin Jucai Coal Industry Co. Ltd. (&#8220;Jucai Coal&#8221;), a coal mine that
        is owned 75</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%
        by Zhao
        Yao. Jucai Coal supplies raw coal to both Puda and other unrelated parties.
        The
        Jucai Coal mining operations produced 450,000 and 400,000 tons of raw coal
        in
        2003 and 2004, respectively. Out of this annual raw coal production, Jucai
        Coal
        sold approximately 20% and 10% of its raw coal production in 2003 and 2004,
        respectively, to Puda at prevailing market prices. The raw coal purchased
        from
        Jucai Coal accounted for approximately 19% and 12% of Puda&#8217;s total raw coal
        purchases in tonnage in 2003 and 2004, respectively. None of Puda&#8217;s raw coal
        suppliers provided more than 15% of its total raw coal purchases in tonnage
        in
        2004. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cost
        of
        transportation of raw coal from the mines to the cleaning facilities is an
        important factor in the industry. By staying close to these top grade coal
        reserves and coal mines, Puda has established its competitive advantage over
        its
        competitors in China, since easier and cheaper access to high quality raw
        coal
        is generally secured. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Puda&#8217;s
        Customers</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Most
        of
        Puda&#8217;s current customers are PRC coke producers (who then sell their coke to
        major steel makers), steel mills that have their own coking facilities, and
        gas
        companies. During 2003, Puda sold approximately 363,000 tons of washed coal
        to
        12 different customers, with no customers accounting for more than 16% of
        total
        tonnage sales. During 2004, Puda sold approximately 315,000 tons of washed
        coal
        to 11 different customers, with no customer accounting for more than 16%
        of
        total tonnage&#160;sales. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Coal
        washed by Shanxi is used by some of the top steel businesses in China including
        Taiyuan Iron &amp; Steel (Group) Co., Ltd., which is an iron and steel complex
        producing steel plate and stainless steel;&#160;and Baotou Iron and Steel
        (Group) Company, Limited, which is a production base of iron and
        steel.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Customers
        normally settle the accounts receivable within three months after they pick
        up
        the cleaned coal. Puda acquires new customers through direct contacts,
        referrals, and participating in national industry trade shows and coal
        supply-demand coordination conferences. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Puda&#8217;s
        Employees</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        currently has approximately 139 employees. The following table shows the
        breakdown of the number of employees by functional departments. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr bgcolor="#ffffff">
              <td valign="top" width="17%" style="BORDER-BOTTOM: black thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Department
                  </font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="26%" style="BORDER-BOTTOM: black thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Job
                  Title / Responsibility</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="top" width="15%" style="BORDER-BOTTOM: black thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">#
                  of Employees</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td valign="middle" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Corporate</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">President,
                  Vice Presidents, Managers</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="15%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10</font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="middle" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Finance</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Finance
                  and Accounting</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="15%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">7</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td valign="middle" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Purchasing</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Purchase
                  raw coal and maintain relationship with suppliers</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="15%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">16</font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="middle" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Marketing
                  and Sales</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Sell
                  cleaned coal, maintain relationship with customers, and acquire
                  new
                  customers</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="15%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">22</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td valign="middle" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Transportation</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Short-range
                  truck drivers (within plant)</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="15%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11</font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="middle" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Production</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Produce
                  cleaned coal</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="15%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">64</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td valign="middle" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Quality
                  Control</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Quality
                  check on input (raw coal) and output (cleaned coal)</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="15%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9
                  </font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="middle" width="17%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total</font></div>
              </td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="26%">&#160;</td>
              <td width="1%">&#160;</td>
              <td valign="middle" width="15%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">139</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-13-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Principal
        Executive Offices</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        principal executive office of Puda is located at 426 Xuefu Street, Taiyuan,
        Shanxi Province, PRC. Puda&#8217;s telephone number, and the telephone number of
        Purezza following the Closing, is </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">86
        351
        2281300</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Management&#8217;s
        Discussion and Analysis or Plan of Operation of Puda</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Disclosure
        Regarding Forward-Looking Statements</em></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
        Form
        8-K includes "forward-looking" statements within the meaning of Section 27A
        of
        the Securities Act, and Puda desires to take advantage of the "safe harbor"
        provisions thereof. Therefore, Puda is including this statement for the express
        purpose of availing itself of the protections of such safe harbor provisions
        with respect to all of such forward-looking statements. The forward-looking
        statements in this Form 8-K reflect Puda's current views with respect to
        future
        events and financial performance. These forward-looking statements are subject
        to certain risks and uncertainties that could cause actual results to differ
        from those anticipated. In its Form 8-K current report, the words "anticipates,"
        "believes, "expects," "intends," "future" and similar expressions identify
        forward-looking statements. Puda undertakes no obligation to publicly revise
        these forward-looking statements to reflect events or circumstances that
        may
        arise after the date hereof. All subsequent written and oral forward- looking
        statements attributable to Puda or persons acting on its behalf are expressly
        qualified in their entirety by this section.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Significant
        Accounting Estimates and Policies</em></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        discussion and analysis of Puda's financial condition and results of operations
        is based upon Puda's financial statements which have been prepared in accordance
        with accounting principles generally accepted in the United States. The
        preparation of these financial statements requires Puda to make estimates
        and
        judgments that affect the reported amounts of assets and liabilities. On
        an
        on-going basis, Puda evaluates its estimates including the allowance for
        doubtful accounts, the salability and recoverability of inventory, income
        taxes
        and contingencies. Puda bases its estimates on historical experience and
        on
        various other assumptions that Puda believes to be reasonable under the
        circumstances, the results of which form Puda&#8217;s basis for making judgments about
        the carrying values of assets and liabilities that are not readily apparent
        from
        other sources. Actual results may differ from these estimates under different
        assumptions or conditions.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        must
        make estimates of the collectability of accounts receivable. Puda analyzes
        historical write-offs, changes in its internal credit policies and customer
        concentrations when evaluating the adequacy of its allowance for doubtful
        accounts. Differences may result in the amount and timing of expenses for
        any
        period if Puda makes different judgments or uses difference
        estimates.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-14-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Property
        and equipment are evaluated for impairment whenever indicators of impairment
        exist. Accounting standards require that if an impairment indicators are
        present, Puda must assess whether the carrying amount of the asset is
        unrecoverable by estimating the sum of the future cash flows expected to
        result
        from the asset, undiscounted and without interest charges. If the carrying
        amount is less than the recoverable amount, an impairment charge must be
        recognized, based on the fair value of the asset. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Goodwill
        is reviewed at least annually for impairment, or more frequently if indicators
        of impairment exist, goodwill is tested by comparing net book value of the
        reporting entity to fair value. Puda&#8217;s management's assumptions about fair
        values require significant judgment because broad economic factors, industry
        factors and technology considerations can result in variable and volatile
        fair
        values.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        cannot predict what future laws and regulations might be passed that could
        have
        a material effect on our results of operations. We assess the impact of
        significant changes in laws and regulations on a regular basis and update
        the
        assumptions and estimates used to prepare our financial statements when we
        deem
        it necessary.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Revenue
        from sales of processed coal is generally recognized during the period when
        the
        coal is delivered and title passes to the purchaser. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda&#8217;s
        functional currency is Renminbi (&#8220;RMB&#8221;) and its reporting currency is U.S.
        dollars. Puda&#8217;s balance sheet accounts are translated into U.S. dollars at the
        year-end exchange rates prevailing during the periods in which these items
        arise. Translation gains and losses are deferred and accumulated as a component
        of other comprehensive income in owners&#8217; equity. Transaction gains and losses
        that arise from exchange rate fluctuations from transactions denominated
        in a
        currency other than the functional currency are included in the statement
        of
        operations as incurred. The translation and transaction gains and losses
        were
        immaterial in the statement of operations as incurred. The translation and
        transaction gains and losses were immaterial for the years ended December
        31,
        2003 and 2004. The PRC presently has a fixed exchange rate of 8.28 RMB per
        US$1.00.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        PRC
        government imposes significant exchange restrictions on fund transfers out
        of
        the PRC that are not related to business operations. These restrictions have
        not
        had a material impact on Puda because it has not previously engaged in any
        significant transactions that are subject to the restrictions.</font></div>
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      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-15-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Results
        of Operations </em></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Year
        Ended December&#160;31, 2004 Compared to Year Ended December&#160;31,
        2003
</u></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>Net
        Revenue.</em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Net
        revenue for the year ended December&#160;31, 2004 increased $6.3&#160;million,
        or 47.0%, from $13.4 million in 2003 to $19.7&#160;million in 2004. The
        tonnage
        sales of cleaned coal decreased 48,000 tons from 363,000 tons in 2003 to
        315,000
        tons during 2004, a 13.2% decrease. The decrease in tonnage sales was primarily
        due to tightened raw coal supply in the PRC in 2004, during which period
        most of
        the raw coal suppliers in the PRC were required by the PRC government to
        temporarily cease their operation for safety checks and improvements. The
        decrease in tonnage sales were offset by significant increase in the per
        ton
        sales price of cleaned coal in all regions. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>Cost
        of Revenues.</em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Puda&#8217;s
        cost of revenue for the year ended December&#160;31, 2004 increased
        $4.0&#160;million, or 43.5%, from $9.2 million in 2003 to $13.2 million
        in 2004.
        This was primarily due to the increase in the price per ton of raw coal,
        which
        was partially offset by the reduced 2004 sales volumes.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>Operating
        Expenses.</em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Operating expenses were $939,000 for the year ended December&#160;31, 2004,
        compared to $541,000 for the year ended December 31, 2003. This represents
        an
        increase of $398,000 from 2003 to 2004, or 73.6%, primarily due to $414,000
        of
        costs in 2004 related to Puda&#8217;s efforts to obtain public listing in the
        U.S.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>Income
        from Operations.</em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Operating profit increased $1.9 million, or 52.8%, from $3.6 million in 2003
        to
        $5.6 million in 2004. The increase was primarily the result of increased
        gross
        profit margin in 2004 (31.3% in 2003 versus 33.0% in 2004) and increased
        net
        revenues in 2004. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>Income
        Taxes.</em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Income
        taxes increased $632,000, or 51.4%, from $1.23 million in 2003 to $1.87 million
        in 2004.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;
        </font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>Net
        Income. </em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
        income was $3.7 million for the year ended December 31, 2004, compared to
        $2.4
        million in the year ended December 31, 2003, an increase of $1.3 million,
        or
        54.2%.&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Liquidity
        and Capital Resources </em></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
        cash
        provided by operating activities was $2.7&#160;million for the year ended
        December&#160;31, 2004, compared to $226,000 in 2003, an increase of $2.47
        million from the prior year. The improvement was primarily due to improved
        working capital cash flows in 2004 compared to 2003.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
        cash
        used by financing activities was $3.2&#160;million for the year ended
        December&#160;31, 2004, compared with cash provided by financing activities
        of
        $0 in 2003. &#160;This was related to a cash distribution paid to owners
        of $3.2
        million in 2004. Puda has no long-term debt as of December 31, 2004.
</font></div>
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      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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          </div>
        </div>
        <div id="HDR">
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          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        currently leases the </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Shanxi
        Liulin Jiucai Plant </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">which
        has
        an annual clean coal washing capacity of 100,000 tons. This facility is located
        about two miles from the premises of coal mine owned and operated by Shanxi
        Liulin Jucai Coal Industry Co., Limited (&#8220;Jucai Coal&#8221;). Zhao Yao is a
        75</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%
        owner
        of Jucai Coal. Jucai Coal leases the coal processing facility to Puda. The
        leasing agreement was entered into on December 2, 2001 for a term of 5 years.
        The cost for the leased capacity is approximately $604,000 annually with
        four
        quarterly payments per year. </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Risk
        Factors</em></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>YOU
        SHOULD CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS AND ALL OTHER INFORMATION
        CONTAINED IN THIS REPORT BEFORE PURCHASING SHARES OF PUREZZA&#8217;S COMMON STOCK.
        INVESTING IN PUREZZA&#8217;S COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. IF ANY OF
        THE FOLLOWING EVENTS OR OUTCOMES ACTUALLY OCCURS, PUDA&#8217;S BUSINESS, OPERATING
        RESULTS AND FINANCIAL CONDITION WOULD LIKELY SUFFER. AS A RESULT, THE TRADING
        PRICE OF PUREZZA&#8217;S COMMON STOCK COULD DECLINE, AND YOU MAY LOSE ALL OR PART OF
        THE MONEY YOU PAID TO PURCHASE PUREZZA&#8217;S COMMON STOCK.</em></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Risks
        Related to Puda&#8217;s Business</u></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Coal
        Supply Agreements</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        If a
        substantial portion of Puda&#8217;s long-term coal supply agreements terminate, Puda&#8217;s
        revenues and operating profits could suffer if Puda were unable to find
        alternate buyers willing to purchase Puda&#8217;s processed coal on comparable terms
        to those in Puda&#8217;s contracts. A substantial portion of Puda&#8217;s sales are made
        under coal supply agreements, which are important to the stability and
        profitability of its operations. The execution of satisfactory coal supply
        agreements is frequently the basis on which Puda undertakes its expansion
        and
        marketing plans. Coal supply agreements are generally renewed annually, and
        it
        is common business practice in PRC that coal purchase and supply agreement
        are
        signed for one year terms, with annual renewals. This practice makes it
        difficult for Puda to forecast long-term purchase and supply quantities.
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Coal
        Price Adjustments</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Puda&#8217;s
        coal supply agreements with customers generally contain provisions that permit
        the parties to adjust the contract price upward or downward at specified
        times.
        Puda may adjust these contract prices for cleaned based on increases or
        decreases in the price of raw coal from its mining suppliers, general inflation
        or deflation, and changes in the factors affecting the cost of producing
        raw or
        cleaned coal, such as taxes, fees, royalties and changes in the laws regulating
        the mining, production, sale or use of coal. Failure of the parties to agree
        on
        a price under these provisions may allow either party to terminate the contract.
        Puda may experience a reduction in coal prices in new supply agreements which
        replace expiring supply contracts at higher prices. Coal supply agreements
        also
        typically contain force majeure provisions allowing temporary suspension
        of
        performance by Puda or the customer during the duration of specified events
        beyond the control of the affected party. Puda&#8217;s operating profits from cleaned
        coal sold under supply agreements depend on a variety of factors. Puda is
        subject to short-term coal price volatility and may be forced to purchase
        raw
        coal at higher prices. If Puda cannot adjust its prices to its customers
        in such
        cases or find alternative customers at a higher price, Puda&#8217;s profitability may
        be adversely impacted. Market prices for raw coal have generally increased
        in
        most regions in the PRC in 2004, and market prices for raw coal appear to
        be
        continuing to increase in most regions in the PRC in 2005. Puda cannot predict
        the future strength of the coal market and cannot provide any assurances
        that
        Puda will be able to replace or modify existing coal supply agreements with
        its
        customers at prices which reflect the continuing increase in raw coal prices.
        </font></div>
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      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Cleaned
        Coal Quality Specifications</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Most
        coal supply agreements contain provisions requiring Puda to deliver coal
        meeting
        quality thresholds for certain characteristics such as BTUs, sulfur content,
        ash
        content, grindability and ash fusion temperature. Failure to meet these
        specifications could result in economic penalties, including price adjustments,
        the rejection of deliveries or termination of the contracts. Moreover, some
        of
        these agreements permit the customer to terminate the contract if transportation
        costs, which Puda&#8217;s customers typically bear, increase substantially. In
        addition, some of these contracts allow our customers to terminate their
        contracts in the event of changes in regulations affecting our industry that
        increase the price of coal beyond specified limits. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Potential
        for Customer Loss</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        The
        loss of, or significant reduction in, purchases by Puda&#8217;s largest customers
        could adversely affect its revenues. For the year ended December&#160;31,
        2004,
        Puda derived 57% of its total cleaned coal revenues from sales to its five
        largest customers. Puda&#8217;s coal supply contracts with its customers are generally
        for one-year terms, which may be renewed by the parties at the end of the
        term
        for an additional one year. Puda is currently discussing the extension of
        existing agreements or entering into new supply agreements with some of these
        customers, but these negotiations may not be successful and those customers
        may
        not continue to purchase cleaned coal from Puda under supply agreements.
        If a
        number of these customers were to significantly reduce their purchases of
        cleaned coal from Puda, or if Puda were unable to sell cleaned coal to them
        on
        terms as favorable to Puda as the terms under its current agreements, Puda&#8217;s
        financial condition and results of operations could suffer materially.
</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Impact
        of Transportation Costs</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        If
        transportation for Puda&#8217;s cleaned coal becomes unavailable or uneconomic for its
        customers, Puda&#8217;s ability to sell cleaned coal could suffer. Transportation
        costs represent a significant portion of the total cost of cleaned coal and,
        as
        a result, the cost of transportation is a critical factor in a customer&#8217;s
        purchasing decision. Increases in transportation costs could make cleaned
        coal a
        less competitive source of energy or could make some of Puda&#8217;s operations less
        competitive than other sources of cleaned coal. Certain coal supply agreements
        permit the customer to terminate the contract if the cost of transportation
        increases by an amount ranging from 10% to 20% in any given 12-month period.
        Coal producers and processors depend upon rail, barge, trucking, overland
        conveyor and other systems to deliver coal to markets. While coal customers
        typically arrange and pay for transportation of cleaned coal from our facilities
        to the point of use, disruption of these transportation services because
        of
        weather-related problems, strikes, lock-outs or other events could temporarily
        impair Puda&#8217;s ability to supply coal to its customers and thus could adversely
        affect Puda&#8217;s results of operations. For example, the high volume of raw coal
        shipped from all Shanxi Province mines could create temporary congestion
        on the
        rail systems servicing that region. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Coal
        Processing Costs</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Puda&#8217;s
        coal processing and cleaning operations are subject to conditions beyond
        its
        control that can delay coal deliveries or increase the cost of processing
        coal
        for varying lengths of time. These conditions include weather and natural
        disasters, unexpected maintenance problems, key equipment failures, variations
        in rock and other natural materials. The government regulates Puda&#8217;s
</font></div>
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      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">coal
        processing operations, which imposes significant costs on it, and future
        regulations could increase those costs or limit Puda&#8217;s ability to crush, clean
        and process coal. The PRC and local authorities regulate the coal mining
        industry with respect to matters such as employee health and safety, permitting
        and licensing requirements, air quality standards, water pollution, plant
        and
        wildlife protection, reclamation and restoration of mining properties after
        mining is completed, the discharge of materials into the environment, surface
        subsidence from underground mining and the effects that mining has on
        groundwater quality and availability. Puda is required to prepare and present
        PRC and local authorities data pertaining to the effect or impact that any
        proposed processing of coal may have upon the environment. The costs,
        liabilities and requirements associated with these regulations may be costly
        and
        time-consuming and may delay commencement, expansion or continuation of Puda&#8217;s
        coal processing operations. The possibility exists that new legislation and/or
        regulations and orders may be adopted that may materially and adversely affect
        Puda&#8217;s operations, its cost structure and/or its customers&#8217; ability to use coal.
        New legislation or administrative regulations (or judicial interpretations
        of
        existing laws and regulations), including proposals related to the protection
        of
        the environment that would further regulate and tax the coal industry, may
        also
        require Puda or its customers to change operations significantly or incur
        increased costs. Certain supply agreements may contain provisions that allow
        a
        purchaser to terminate its contract if legislation is passed that either
        restricts the use or type of coal permissible at the purchaser&#8217;s plant or
        results in specified increases in the cost of coal or its use. These factors
        and
        legislation, if enacted, could have a material adverse effect on Puda&#8217;s
        financial condition and results of operations. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Raw
        Coal Supply Sources</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Currently, seven of Puda&#8217;s total of eight raw coal suppliers provide 10% or more
        of Puda&#8217;s total raw coal purchases in tonnage in 2004, although no supplier
        provided more than 15% of Puda&#8217;s total purchases in tonnage. One of Puda&#8217;s local
        suppliers was Liulin Jucai Coal Industry Co. Ltd. (&#8220;Jucai Coal &#8221;), a related
        coal mine owned 75</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%
        by Zhao
        Yao. Jucai Coal supplied raw coal to both Puda and other unrelated parties.
        Out
        of this annual raw coal production, Jucai Coal sold approximately 20% and
        10% of
        its raw coal production in 2003 and 2004, respectively, to Puda at prevailing
        market prices. The raw coal purchased from Jucai Coal accounted for
        approximately 19% and 12% of Puda&#8217;s total raw coal purchases in tonnage in 2003
        and 2004, respectively. Although Puda has relatively long-term relationship
        with
        these suppliers, there is no assurance that these suppliers will continue
        to
        provide raw coal to Puda on a timely basis. If these local suppliers face
        production shortages or the business relationships between Puda and these
        suppliers deteriorates, Puda may have difficulty in sourcing raw coal with
        comparable quality from other suppliers in a timely manner at comparable
        prices.
</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Limited
        Washing Capacity; Delays in Delivery of Cleaned Coal</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        If
        Puda&#8217;s sales increase, there is no assurance that Puda will be able to deliver
        increased product volumes on a timely and efficient basis. Puda has limited
        coal
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">washing
        </font>and cleaning capacity. Currently, Puda&#8217;s coal washing and cleaning
        facilities can process up to 500,000 tons of clean coal per year.&#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
        2003
        and 2004, Puda's sales of clean coal were 363,000 tons and 315,000 tons,
        respectively, representing approximately 73% and 63% of overall washing capacity
        in 2003 and 2004, respectively. </font>&#160;Puda&#8217;s current lease on the
</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Shanxi
        Liulin Jucai Plant, which is located about two miles from the </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Jucai
        Coal mining operations and has an annual clean coal washing capacity of 100,000
        tons, expires in 2006.</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        It is
        possible that this lease may not be renewed and, in such case, Puda may not
        be
        able to find suitable replacement capacity at reasonable costs. Further,
        there
        can be no assurance that Puda will be able to timely deliver its products
        to its
        customers on a consistent basis due to rail and truck transportation
        interruptions, especially with increased product volumes, and a failure to
        do so
        could have a material and adverse effect on its business, operations and
        finances.</font></div>
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      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Geographic
        Concentration; Fluctuations in Regional Economic Conditions</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Nearly
        all of Puda&#8217;s sales are concentrated in the central and northern area of China.
        Accordingly, Puda is susceptible to fluctuations in its business caused by
        adverse economic conditions in their region. Difficult economic conditions
        in
        other geographic areas into which Puda may expand may also adversely affect
        its
        business, operations and finances.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Coal
        Industry Capacity in PRC</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        If the
        coal industry experiences overcapacity in the future, Puda&#8217;s profitability could
        be impaired. &#160; During the mid-1970s and early 1980s, a growing coal
        market
        and increased demand for coal in the PRC attracted new investors to the coal
        industry, spurred the development of new mines and resulted in added production
        capacity throughout the industry, all of which led to increased competition
        and
        lower coal prices. Similarly, an increase in future coal prices could encourage
        the development of expanded capacity by new or existing coal producers and
        coal
        processors. Any overcapacity could reduce coal prices in the future.
</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Dependence
        on Executives</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Puda is
        highly dependent on the services of Zhao Ming and Zhao Yao, who are brothers,
        and the loss of their services would have a material and adverse impact on
        the
        operations of Puda. They have been primarily responsible for the development
        of
        Puda and the development and marketing of its products. Puda has not applied
        for
        key-man life insurance on the lives of these executives, but may do so in
        the
        future.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Proprietary
        Knowledge and Absence of Patent Protection</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Puda
        has no patents covering its production processes and expects to rely principally
        on know-how and the confidentiality of its production processes for its coal
        in
        producing a competitive product line of coal products. There is no assurance
        that any of these factors can be maintained or that they will afford Puda
        a
        meaningful competitive advantage. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Competition</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        The
        coal crushing, washing and processing business is highly competitive in the
        PRC
        and, therefore, Puda faces substantial competition in connection with the
        marketing and sale of its products. Most of Puda&#8217;s competitors are well
        established, have greater financial, marketing, personnel and other resources,
        have been in business for longer periods of time than Puda, and have products
        that have gained wide customer acceptance in the marketplace. The greater
        financial resources of such competitors will permit them to implement extensive
        marketing and promotional programs.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Lack
        of Property and General Liability Insurance</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Puda
        and is self-insured and does not carry any property insurance, general liability
        insurance, or any other insurance that covers the risks of their business
        operations. As a result, any material loss or damage to its properties or
        other
        assets, or personal injuries arising from its business operations would have
        a
        material adverse affect on its financial condition and operations.</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Terrorist
        Attacks and Military Conflict</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Terrorist attacks and threats, escalation of military activity in response
        to
        such attacks or acts of war may negatively affect Puda&#8217;s business, financial
        condition and results of operations. Puda&#8217;s business is affected by general
        economic conditions, fluctuations in consumer confidence and spending, and
        market liquidity, which can decline as a result of numerous factors outside
        of
        its control, such as terrorist attacks and acts of war. Future terrorist
        attacks, rumors or threats of war, actual conflicts involving the PRC or
        its
        allies, or military or trade disruptions affecting Puda&#8217;s customers may
        materially adversely affect its operations. As a result, there could be delays
        or losses in transportation and deliveries of processed coal to Puda&#8217;s
        customers, decreased sales of its coal and extension of time for payment
        of
        accounts receivable from its customers. Strategic targets such as energy-related
        assets may be at greater risk of future terrorist attacks than other targets.
        In
        addition, disruption or significant increases in energy prices could result
        in
        government-imposed price controls. It is possible that any, or a combination,
        of
        these occurrences could have a material adverse effect on Puda&#8217;s business,
        financial condition and results of operations. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Customer
        Creditworthiness</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Puda&#8217;s
        ability to collect payments from its customers could be impaired if their
        creditworthiness deteriorates. &#160; Puda&#8217;s ability to receive payment for
        processed coal sold and delivered depends on the continued creditworthiness
        of
        its customers. Puda&#8217;s customer base is changing with deregulation as utilities
        sell their power plants to their non-regulated affiliates or third parties.
        These new power plant owners may have credit ratings that are below investment
        grade. If deterioration of the creditworthiness of other electric power
        generator customers or trading counterparties continues, Puda&#8217;s business could
        be adversely affected. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Expansion
        Risks</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Puda
        anticipates that its proposed expansion of its coal crushing, washing and
        processing plants may include the construction of new or additional facilities.
        Puda&#8217;s cost estimates and projected completion dates for construction of new
        production facilities may change significantly as the projects progress.
        In
        addition, Puda&#8217;s projects will entail significant construction risks, including
        shortages of materials or skilled labor, unforeseen environmental or engineering
        problems, weather interferences and unanticipated cost increases, any of
        which
        could have a material adverse effect on the projects and could delay their
        scheduled openings. A delay in scheduled openings will delay Puda&#8217;s receipt of
        increased sales revenues. There is no assurance that Puda will be able to
        sell
        any or all of the cleaned coal that any newly-constructed capacity could
        produce, and there is no assurance that Puda will be able to source sufficient
        raw coal to allow it to utilize such additional processing capacity. The
        projects of Puda to finance, develop, and expand its coal processing facilities
        will be subject to the many risks inherent in the rapid expansion of a high
        growth business enterprise, including unanticipated design, construction,
        regulatory and operating problems, and the significant risks commonly associated
        with implementing a marketing strategy in changing and expanding markets.
        There
        can be no assurance that any of these projects will become operational within
        the estimated time frames and projected budgets at the time Puda enters into
        a
        particular agreement, or at all. In addition, Puda may develop projects as
        joint
        ventures in an effort to reduce its financial commitment to individual projects.
        There can be no assurance that the significant expenditures required to expand
        its coal crushing, washing and processing plants will ultimately result in
        the
        establishment of increased profitable operations. When Puda&#8217;s future expansion
        projects become operational, it will be required to add and train personnel,
        expand its management information systems and control expenses. If it does
        not
        successfully address its increased management needs or Puda is otherwise
        is
        unable to manage its growth effectively, Puda&#8217;s operating results could be
        materially and adversely affected.</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Government
        Regulation</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Puda is
        subject to extensive regulation by China's Mining Ministry, and by other
        county
        and local authorities in jurisdictions in which its products are processed
        or
        sold, regarding the processing, storage, and distribution of its products.
        Puda's processing facilities are subject to periodic inspection by national,
        county and local authorities. Puda believes that it is currently in substantial
        compliance with all material governmental laws and regulations and maintains
        all
        material permits and licenses relating to its operations. Nevertheless, there
        can be no assurance that Puda will continue to be in substantial compliance
        with
        current laws and regulations, or whether Puda will be able to comply with
        any
        future laws and regulations. To the extent that new regulations are adopted,
        Puda will be required to conform its activities in order to comply with such
        regulations. Failure by Puda to comply with applicable laws and regulations
        could subject Puda to civil remedies, including fines, injunctions, recalls
        or
        seizures, as well as potential criminal sanctions, which could have a material
        and adverse effect on its business, operations and finances.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Doing
        Business in the PRC</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Doing
        business in the PRC involves various risks including internal and international
        political risks, evolving national economic policies as well as financial
        accounting standards, expropriation and the potential for a reversal in economic
        conditions. Since the late 1970s, the government of the PRC has been reforming
        the Chinese economic system. These reforms have resulted in significant economic
        growth and social progress. Although Puda believes that economic reform and
        the
        macroeconomic policies and measures adopted by the current PRC government
        will
        continue to have a positive effect on economic development in the PRC and
        that
        Puda will continue to benefit from such policies and measures, these policies
        and measure may from time to time be modified or revised. Adverse changes
        in
        economic policies of the PRC government or in the laws and regulations, if
        any,
        could have a material and adverse effect on the overall economic growth of
        the
        PRC, and could adversely affect Puda&#8217;s business operations.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Foreign
        Currency Exchange</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        The PRC
        currency, "Renminbi", is not a freely convertible currency, which could limit
        Puda&#8217;s ability to obtain sufficient foreign currency to support its business
        operations in the future. Puda relies on the PRC government's foreign currency
        conversion policies, which may change at any time, in regard to its currency
        exchange needs. Puda receives all of its revenues in Renminbi, which is not
        freely convertible into other foreign currencies. In the PRC, the government
        has
        control over Renminbi reserves through, among other things, direct regulation
        of
        the conversion of Renminbi into other foreign currencies and restrictions
        on
        foreign imports. Although foreign currencies which are required for "current
        account" transactions can be bought freely at authorized PRC banks, the proper
        procedural requirements prescribed by PRC law must be met. At the same time,
        PRC
        companies are also required to sell their foreign exchange earnings to
        authorized PRC banks and the purchase of foreign currencies for capital account
        transactions still requires prior approval of the PRC government. This type
        of
        heavy regulation by the PRC government of foreign currency exchange restricts
        certain of our business operations and a change in any of these government
        policies, or any other, could further negatively impact our
        operations.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Fluctuations
        in the exchange rate between the PRC currency and the United States dollar
        in
        the future could adversely affect Puda&#8217;s operating results. The functional
        currency of Puda&#8217;s operations in the PRC is "Renminbi". Results of Puda&#8217;s
        operations are translated at average exchange rates into United States dollars
        for purposes of reporting results. As a result, fluctuations in exchange
        rates
        may adversely affect Puda&#8217;s expenses and results of operations as well as the
        value of its assets and liabilities. Fluctuations may adversely affect the
        comparability of period-to-period results. Although Puda may use hedging
        techniques in the future (which it currently does not use), Puda may not
        be able
        to eliminate the effects of currency fluctuations. Thus, exchange rate
        fluctuations could have a material adverse impact on Puda&#8217;s operating results
        and stock prices. </font></div>
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      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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          </div>
        </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Timely
        Information</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        As a
        company based in the PRC, Puda&#8217;s shareholders may have greater difficulty in
        obtaining information about Puda on a timely basis than would shareholders
        of a
        U.S.-based company. Puda&#8217;s operations will continue to be conducted in the PRC
        and shareholders may have difficulty in obtaining information about Puda
        from
        sources other than Puda itself. Information available from newspapers, trade
        journals, or local, regional or national regulatory agencies such as issuance
        of
        construction permits, contract awards for development projects, etc. will
        not be
        readily available to shareholders. Shareholders will be dependent upon Puda&#8217;s
        management for reports of Puda&#8217;s progress, development, activities and
        expenditure of proceeds.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Payment
        of Dividends</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        In
        order to pay dividends, a conversion of Renminbi into US dollars is required.
        Under current PRC law, the conversion of Renminbi into foreign currency
        generally requires government consent. Government authorities may impose
        restrictions that could have a negative impact in the future on the conversion
        process and upon the ability of Puda to meet its cash needs, and to pay
        dividends. However, a subsidiary of Purezza is presently classified as a
        wholly-owned foreign enterprise ("WFOE") in the PRC that has verifiable foreign
        investment in the PRC, funding having been made through an official PRC banking
        channel. Because this subsidiaries of Purezza qualifies for treatment as
        a WFOE,
        the subsidiary can convert Renminbi, declare dividends and its funds can
        be
        repatriated to Purezza in the United States under current laws and regulations
        in the PRC, subject to limitations and restrictions imposed by PRC laws.
        However, the PRC laws governing foreign currency exchange are evolving, and
        changes in such laws may adversely affect the ability to convert Renminbi,
        declare dividends and repatriate funds to the United States</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Contractual
        Arrangements</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        In
        order to comply with PRC regulatory requirements, Puda is operated
        by</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        a
        wholly-owned foreign enterprise ("WFOE") in the PRC, which is owned entirely
        by
        Purezza&#8217;s direct subsidiary based in the British Virgin Islands (&#8220;BVI Company&#8221;).
        As a result Purezza does not have a direct </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">controlling
        ownership in Puda. If the PRC government determines that these agreements
        are
        not in compliance with applicable regulations, Purezza&#8217;s business interests in
        the PRC could be adversely affected. Purezza controls and operates Puda&#8217;s
        business through contractual arrangements between the WFOE, Puda and the
        individual owners of Puda, but Purezza, the WFOE and the BVI Company do not
        have
        an equity ownership in Puda. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;
        </font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">More
        specifically, the WFOE h</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">as
        agreed
        to advise, consult, manage and operate Puda&#8217;s business, to provide certain
        financial accommodations to Puda, and to license certain technology to Puda
        for
        use in its business, in exchange for Puda&#8217;s payment of all of its operating cash
        flow to the WFOE. Further, each of the individual owners of Puda have granted
        the WFOE the exclusive right and option to acquire all of their registered
        capital of Puda and have authorized the WFOE to vote at any meeting or action
        of
        the owners of Puda and to act as the representative for such owners in all
        matters respecting Puda.</font></div>
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      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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          </div>
        </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-23-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Although
        we believe we are in compliance with current PRC regulations, we cannot be
        sure
        that the PRC government would view these operating and contractual arrangements
        to be in compliance with PRC licensing, registration or other regulatory
        requirements, with existing policies or with requirements or policies that
        may
        be adopted in the future. If we are determined not to be in compliance, the
        PRC
        government could revoke our business and operating licenses, require us to
        discontinue or restrict our operations, restrict our right to collect revenues,
        require us to restructure our operations, impose additional conditions or
        requirements with which we may not be able to comply, impose restrictions
        on our
        business operations or on our customers, or take other regulatory or enforcement
        actions against us that could be harmful to our business. We may also encounter
        difficulties in obtaining performance under or enforcement of related
        contracts.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
        must
        reply on these operating and contractual arrangements to control and operate
        Puda&#8217;s business. These contractual arrangements may not be as effective in
        providing control over these entities as direct ownership. For example, Puda
        could fail to take actions required for our business or fail to maintain
        and
        operate its business in compliance with its contractual obligation to do
        so.
        Puda may transact business with parties not affiliated with us. If Puda fails
        to
        perform under its agreements with us, we may have to rely on legal remedies
        under PRC law, which we cannot be sure would be effective. In addition, we
        cannot be certain that the individual equity owners of Puda would always
        act in
        the best interests of Purezza, especially if they leave Purezza.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Substantially
        all profits generated from Puda will be paid to the WFOE through related
        party
        transactions under contractual agreements. We believe that the terms under
        these
        contractual agreements are in compliance with the laws in the PRC. However,
        the
        interpretation and application of existing PRC laws, regulations and policies,
        the stated positions of the PRC authorities and possible new laws, regulations
        or policies, there are substantial uncertainties regarding the application
        of
        PRC laws, especially with respect to existing and future foreign investments
        in
        the PRC. As such, it is possible these contractual agreements may be subject
        to
        differing applications and interpretations under PRC laws. Further, due to
        the
        uncertainties surrounding the interpretation of the transfer pricing rules
        relating to related party transactions in the PRC, it is possible that tax
        authorities in the PRC may challenge the transfer prices that we have used
        for
        related party transactions among our entities in the PRC in the
        future.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Risks
        Related to Purezza</u></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Possible
        Reliance upon Financial Statements</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Purezza
        has required audited and unaudited financial statements from Puda. However,
        not
        all required audited and unaudited financials will be available at the Closing.
        Since Purezza is subject to the reporting provisions of the Securities Exchange
        Act of 1934, as amended (the "Exchange Act"), it will be required to furnish
        certain information about significant acquisitions, including audited and
        unaudited financial statements for any business that it acquires. Consequently,
        the continued ability of Purezza to remain a reporting company and publicly
        trading will be in jeopardy if Puda cannot furnish the required audited and
        unaudited financials in a timely manner and, in the event of such failure
        to
        furnish, the value of your investment in Purezza may be significantly reduced.
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
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          </div>
        </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Other
        Regulation</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Puda&#8217;s
        business will be subject to regulation and/or licensing by federal, state,
        or
        local authorities as well as central, provincial, local and municipal regulation
        and licensing in the PRC. Compliance with such regulations and licensing
        can be
        expected to be a time-consuming, expensive process. Compliance with foreign
        country laws and regulations affecting foreign investment, business operations,
        currency exchange, repatriation of profits, and taxation, will increase the
        risk
        of your investment. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>No
        Foreseeable Dividends</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Purezza
        does not intend to pay any dividends. Purezza does not foresee making any
        cash
        distributions in the manner of a dividend or otherwise. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Dilutive
        Effects of Issuing Additional Common Stock</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        The
        Puda BVI Members will be issued preferred stock that is convertible into
        a large
        number of shares of Purezza&#8217;s common stock which will dilute the ownership
        interest of Purezza&#8217;s current stockholders. In addition, it will be likely that
        there will be additional authorized but unissued shares that may be later
        issued
        by the then new management for any purpose without the consent or vote of
        the
        stockholders. These issuances that may occur will dilute the interests of
        Purezza&#8217;s stockholders after the Closing.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Thinly-traded
        Public Market</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        Purezza&#8217;s securities will be very thinly traded, and the price if traded may not
        reflect the value of Purezza. Moreover, a reverse split of the shares is
        expected which may not reflect the value of Purezza either. There can be
        no
        assurance that there will be an active market for Purezza&#8217;s shares either now or
        in the future. The market liquidity will be dependant on the perception of
        the
        operating business and any steps that its management might take to bring
        the
        company to the awareness of investors. There can be no assurance given that
        there will be any awareness generated. Consequently, investors may not be
        able
        to liquidate their investment or liquidate it at a price that reflects the
        value
        of the business. If a more active market should develop, the price may be
        highly
        volatile. Because there may be a low price for Purezza&#8217;s securities, many
        brokerage firms may not be willing to effect transactions in the securities.
        Even if an investor finds a broker willing to effect a transaction in the
        securities, the combination of brokerage commissions, transfer fees, taxes,
        if
        any, and any other selling costs may exceed the selling price. Further, many
        lending institutions will not permit the use of such securities as collateral
        for any loans.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Possible
        Rule 144 Sales</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
        The
        majority of Purezza&#8217;s shares outstanding prior to the Closing were "restricted
        securities" within the meaning of Rule 144 under the Securities Act of 1933,
        as
        amended (the &#8220;Act&#8221;). As restricted shares, these shares may be resold only
        pursuant to an effective registration statement or under the requirements
        of
        Rule 144 or other applicable exemption from registration under the Act and
        as
        required under applicable state securities laws. Rule 144 provides in essence
        that a person who has held restricted securities for a period of one year
        may,
        under certain conditions, sell every three months, in brokerage transactions,
        a
        number of shares that does not exceed the greater of 1.0% of a company's
        outstanding common stock or the average weekly trading volume during the
        four
        calendar weeks prior to the sale. There is no limit on the amount of restricted
        securities that may be sold by a non-affiliate after the restricted securities
        have been held by the owner for a period of two years. Current stockholders
        who
        own 10% or more of Purezza&#8217;s shares will likely be deemed an affiliate until 90
        days after the exchange transaction is completed. After such 90-day period,
        and
        assuming said shares have been held for more than two years, these stockholders
        may be able to sell their shares without volume restrictions. A sale under
        Rule
        144 or under any other exemption from the Act, if available, or pursuant
        to
        subsequent registrations of Purezza&#8217;s shares, may have a depressive effect upon
        the price of Purezza&#8217;s shares in any market that may develop. </font></div>
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          </div>
        </div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
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          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Executive
        Compensation</strong></font></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">&#160;</div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Summary
        Compensation Table</em></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        following table sets forth information concerning all compensation paid for
        services to Puda by its executive officers in all capacities for 2002, 2003
        and
        2004. No other executive officer received total annual salary and bonus payments
        in excess of $100,000 during these periods. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr>
                <td valign="bottom" width="27%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="8" valign="bottom" width="20%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Long
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              </tr>
              <tr>
                <td valign="bottom" width="27%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="8" valign="bottom" width="20%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Annual
                    Compensation</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="5" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Awards</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Payouts</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td valign="bottom" width="27%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Name
                    </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">and
                    </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Principal
                    </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Position</font></div>
                </td>
                <td width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Year</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Salary
                    ($)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Bonus
                    ($)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Annual
                    Compensation ($)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Restricted</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Stock
                    Award(s)</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">($)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Securities</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Underlying
                    Options/</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SARs
                    (#) (2)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">LTIP</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Payouts
                    ($)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="6%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">All
                    Other</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Compensation
                    </font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">($)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="27%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                    Ming</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Chairman
                    and Chief Executive Officer)</font></div>
                </td>
                <td width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2002</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4,833</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5,075</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4,261</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="27%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                    Yao</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Chief
                    Operating Officer and Director)</font></div>
                </td>
                <td width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2002</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4,833</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5,075</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4,261</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Jin
                    Xia</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Chief
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="5%" style="BORDER-BOTTOM: #000000 thin solid">
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                <td width="1%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="5%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="5%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="5%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="5%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="5%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="5%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="5%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="5%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
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          </table>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Option
        Grants</em></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        does
        not maintain any equity incentive or stock option plan. Accordingly, Puda
        did
        not grant options to purchase any equity interests to any persons, and no
        stock
        options are issued or outstanding. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Employment
        Contracts </em></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        does
        not have employment agreements with any of its executive officers or key
        employees. Purezza does not have employment agreements with any of its newly
        appointed executive officers.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-26-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Security
        Ownership of Certain Beneficial Owners and Management </strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>and
        Related Stockholder Matters.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        following table sets forth certain information regarding Purezza&#8217;s common stock
        beneficially owned on July 15, 2005, prior to giving effect to the Closing,
        for
        (i) each stockholder known to be the beneficial owner of 5% or more of Purezza&#8217;s
        outstanding common stock, (ii) each executive officer and director, and (iii)
        all executive officers and directors as a group. In general, a person is
        deemed
        to be a "beneficial owner" of a security if that person has or shares the
        power
        to vote or direct the voting of such security, or the power to dispose or
        to
        direct the disposition of such security. A person is also deemed to be a
        beneficial owner of any securities of which the person has the right to acquire
        beneficial ownership within 60 days. At July 15, 2005, immediately prior
        to the
        Closing, Purezza had 59,000,000 shares of common stock outstanding.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div align="left">
        <table border="0" cellpadding="0" cellspacing="0" width="100%">

            <tr bgcolor="#ffffff">
              <td valign="bottom" width="50%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Name</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td colspan="2" valign="bottom" width="14%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Number
                  of Shares Beneficially Owned</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td colspan="2" valign="bottom" width="14%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Percent
                  of Shares</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="50%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Kevin
                  R. Keating</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">936A
                  Beachland Boulevard, Suite 13</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Vero
                  Beach, Florida 32963</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,000,000
                  (1</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.4</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="50%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Keating
                  Reverse Merger Fund, LLC</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5251
                  DTC Parkway, Suite 1090</font></div>
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              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">47,185,000
                  (2</font></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">80.0</font></div>
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              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
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            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="50%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">All
                  Executive Officers and Directors as a group</font></div>
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              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,000,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.4</font></div>
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              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="50%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="bottom" width="1%">&#160;</td>
              <td align="right" valign="bottom" width="13%">&#160;</td>
              <td align="left" valign="bottom" width="2%">&#160;</td>
              <td align="left" valign="bottom" width="1%">&#160;</td>
              <td align="right" valign="bottom" width="13%">&#160;</td>
              <td align="left" valign="bottom" width="1%">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
        <div>
          <hr style="COLOR: #000000" align="left" noshade size="1" width="15%">
        </div>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td align="right" style="WIDTH: 36pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1)&#160;&#160;</font></td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Kevin
                  R. Keating is not affiliated with and has no equity interest in
                  Keating
                  Reverse Merger Fund, LLC and disclaims any beneficial interest
                  in the
                  shares of Purezza&#8217;s Common Stock owned by Keating Reverse Merger Fund,
                  LLC.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td align="right" style="WIDTH: 36pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2)&#160;&#160;</font></td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Keating
                  Reverse Merger Fund, LLC is not owned by or affiliated with Kevin
                  R.
                  Keating and disclaims any beneficial interest in the shares of
                  Purezza&#8217;s
                  Common Stock owned by Kevin R.
                  Keating.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        following table sets forth certain information regarding Purezza&#8217;s common stock
        beneficially owned on July 15, 2005, after giving effect to the Closing,
        for (i)
        each stockholder known to be the beneficial owner of 5% or more of Purezza&#8217;s
        outstanding common stock, (ii) each executive officer and director, and (iii)
        all executive officers and directors as a group, on an approximated pre-
        and
        post- Reverse Split basis. Unless otherwise indicated, each person in the
        table
        has sole voting and investment power with respect to the shares shown. The
        table
        assumes a total of 737,500,000 and 73,750,000 shares of Purezza&#8217;s common stock
        outstanding as of July 15, 2005, on a pre- and post- Reverse Split basis,
        respectively, and on an as-converted basis. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div align="left">
        <table border="0" cellpadding="0" cellspacing="0" width="100%">

            <tr bgcolor="#ffffff">
              <td valign="bottom" width="47%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Name
                  of Beneficial Owner</strong></font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td colspan="2" valign="bottom" width="14%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Amount
                  of Beneficial Ownership</strong></font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(Pre-Reverse
                  Split)</strong></font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td colspan="2" valign="bottom" width="14%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Amount
                  of Beneficial Ownership</strong></font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(Post-Reverse
                  Split)</strong></font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td colspan="2" valign="bottom" width="14%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Percent
                  of Beneficial Ownership</strong></font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="47%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                  Ming (1), (2)</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">531,000,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">53,100,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">72.0</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="47%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                  Yao (1), (2)</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">132,750,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13,275,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">18.0</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="47%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Jin
                  Xia (1)</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">0</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">0</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">0</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="47%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Wang
                  Lisheng (1)</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">0</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">0</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">0</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="47%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Kevin
                  R. Keating</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">936A
                  Beachland Boulevard, Suite 13</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Vero
                  Beach, Florida 32963</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,000,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">200,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">0.3</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
              </td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="47%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Keating
                  Reverse Merger Fund, LLC (2)</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5251
                  DTC Parkway, Suite 1090</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Greenwood
                  Village, Colorado 80111</font></div>
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              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">47,185,000</font></div>
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              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4,718,500</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6.4</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
              </td>
            </tr>
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              <td align="left" valign="bottom" width="47%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">All
                  Executive Officers and Directors as a group</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">663,750,000
                  </font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">66,375,000
                  </font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
              <td align="right" valign="bottom" width="13%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">90.0</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
        <div>
          <hr style="COLOR: #000000" align="left" noshade size="1" width="15%">
        </div>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td align="right" style="WIDTH: 36pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1)&#160;&#160;</font></td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Address
                  is c/o Shanxi Puda Resources Co, Ltd. 426 Xuefu Street, Taiyuan,
                  Shanxi
                  Province, PRC. The beneficial ownership of Purezza&#8217;s common stock is based
                  on the holder&#8217;s respective ownership of Purezza&#8217;s Series A Convertible
                  Preferred Stock, on an as-converted basis prior to the proposed
                  Reverse
                  Split. Each share of Series A Convertible Preferred Stock is convertible
                  into 678.5 shares of Purezza&#8217;s common stock on a pre-Reverse Split basis.
                  The shares of Series A Convertible Preferred Stock will immediately
                  and
                  automatically be converted into shares of Purezza&#8217;s common stock upon the
                  approval by a majority of Purezza&#8217;s stockholders (voting together on an
                  as-converted-to-common-stock basis), following the Closing, of
                  an increase
                  in the number of authorized shares of Purezza&#8217;s common stock from
                  100,000,000 to 150,000,000, and a 1 for 10 reverse stock split
                  of
                  Purezza&#8217;s outstanding common stock.
</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td align="right" style="WIDTH: 36pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2)&#160;&#160;</font></td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
                  as of the Closing, KRM Fund and each Puda BVI Member have agreed
                  to vote
                  their shares of Purezza&#8217;s common stock (voting together on an
                  as-converted-to-common-stock basis) to (i) elect a person designated
                  by
                  KRM Fund from time to time (the &#8220;KRM Designate&#8221;) to Purezza&#8217;s board for a
                  period of one year following the Closing, (ii) elect such other
                  persons
                  that may be designated by Zhao Ming from time to time to fill any
                  vacant
                  position on the board of directors (other than the KRM Designate),
                  and
                  (iii) approve the Reverse Split, an increase in Purezza&#8217;s authorized
                  common stock from 100,000,000 to 150,000,000, and a corporate name
                  change.
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
        Ming
        and Zhao Yao are brothers. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-27-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Certain
        Relationships and Related Transactions involving Puda</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
        than the employment arrangements described above in &#8220;Executive Compensation&#8221; and
        the transactions described below or elsewhere in this Report, since December
        31,
        2002, there has not been, nor is there currently proposed, any transaction
        or
        series of similar transactions to which Puda was or will be a party:
</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td align="right" style="WIDTH: 54pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-&#160;&#160;</font></td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">in
                  which the amount involved exceeds $60,000;
                  and</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td align="right" style="WIDTH: 54pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-&#160;&#160;</font></td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">in
                  which any director, executive officer, shareholder who beneficially
                  owns
                  5% or more of Purezza&#8217;s common stock or any member of their immediate
                  family had or will have a direct or indirect material
                  interest.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Transactions
        with Officers, Directors and 5% Holders of Puda</em></strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
          declared cash distributions to its owners, Zhao Ming (80%) and Zhao Yao
          (20%),
          of $1.295 million and $2.393 million in 2003 and 2004, respectively. Of
          these
          amounts, $3.204 million was paid in 2004 with a distribution payable balance
          of
          $484,000 as of December 31, 2004.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
          currently secures raw coal from a diversified pool of local Liulin County
          coal
          mines, including Liulin Jucai Coal Industry Co. Ltd. (&#8220;Jucai Coal&#8221;), a coal mine
          that is owned 75</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%
          by Zhao
          Yao. Jucai Coal supplies raw coal to both Puda and other unrelated parties.
          The
          Jucai Coal mining operations produced 450,000 and 400,000 tons of raw coal
          in
          2003 and 2004, respectively. Out of this annual raw coal production, Jucai
          Coal
          sold approximately 20% and 10% of its raw coal production in 2003 and 2004,
          respectively, to Puda at prevailing market prices. The raw coal purchased
          from
          Jucai Coal accounted for approximately 19% and 12% of Puda&#8217;s total raw coal
          purchases in 2003 and 2004, respectively. </font></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
        of
        December 31, 2003 and 2004, Puda had the following amounts due from/to related
        parties:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td colspan="5" valign="bottom" width="25%" style="BORDER-BOTTOM: #000000 thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
                  31,</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
            </tr>
            <tr>
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Receivable
                  from Shanxi Puda Resources Group Limited (&#8220;Puda Group&#8221;), a related company
                  with common owners</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,871,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,234,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Receivable
                  from an owner, Zhao Ming</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Total
                  related party receivables</strong></font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>$</strong></font></div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>2,871,000</strong></font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>$</strong></font></div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>2,236,000</strong></font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                <div style="MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #ffffff">
                <div style="MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">
                <div style="MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                <div style="MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">
                <div style="MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">
                <div style="MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                <div style="MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">
                <div style="MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
              </td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;
                  <font size="2">Payable to an owner, Zhao Yao</font></font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">186,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">197,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accounts
                  payable to Shanxi Liulin Jucai Coal Industry Co., Ltd., a related
                  party
                  with common owner</font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">114,000</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">268,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Total
                  related party payables</strong></font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>$</strong></font></div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>300,000</strong></font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>$</strong></font></div>
              </td>
              <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>465,000</strong></font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
            </tr>
            <tr bgcolor="#ffffff">
              <td align="left" valign="bottom" width="71%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="bottom" width="1%">&#160;</td>
              <td align="right" valign="bottom" width="11%">&#160;</td>
              <td align="left" valign="bottom" width="2%">&#160;</td>
              <td align="left" valign="bottom" width="1%">&#160;</td>
              <td align="right" valign="bottom" width="11%">&#160;</td>
              <td align="left" valign="bottom" width="1%">&#160;</td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        above
        related party receivable and payable balances are unsecured, interest-free
        and
        there are no fixed terms for repayment.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-28-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        amount payable to Zhao Yao represents land use rights paid by him on behalf
        of
        Puda.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
        2001,
        Puda entered into agreements with Puda Group, to lease an office and certain
        equipment. In the years ended December 31, 2003 and 2004, rental expenses
        payable to Puda Group were $24,000 and $24,000 respectively.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By
        an
        agreement entered into between Puda and Puda Group on April 25, 2005, Puda
        Group
        agreed to pay all the tax liabilities (including surcharges and penalties)
        of
        Puda with retrospective effect from its establishment to December 31, 2004.
        As
        of December 31, 2003 and 2004, Puda has paid $2,800,000 and $5,768,000,
        respectively, to Puda Group for payment of income taxes and value-added tax
        (&#8220;VAT&#8221;). In December 2004, Puda Group has paid Puda&#8217;s income taxes of $1,678,000
        and VAT of $1,950,000 to the China Tax Bureau. In April 2005, Puda Group
        has
        paid Puda&#8217;s VAT of $251,000 to the China Tax Bureau. Puda expects that its
        income tax for the year 2004 will be paid to the China Tax Bureau in July
        2005.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        currently leases the </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Shanxi
        Liulin Jiucai Plant </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">which
        has
        an annual clean coal washing capacity of 100,000 tons. This facility is located
        <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">about
        two
        miles from </font>the premises of coal mine owned and operated by Shanxi Liulin
        Jucai Coal Industry Co., Limited (&#8220;Jucai Coal&#8221;). Zhao Yao is a 75</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%
        owner
        of Jucai Coal. <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Jucai
        Coal leases this coal processing facility to Puda.</font>&#160;The leasing
        agreement was entered into on December 2, 2001 for a term of 5 years. The
        cost
        for the leased capacity is approximately $604,000 annually with four quarterly
        payments per year. <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">It
        is
        possible that this lease may not be renewed when it expires.</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Principal
        Accountant Fees and Services</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Moore
        Stephens (&#8220;Moore Stephens&#8221;), Puda&#8217;s independent registered public accounting
        firm, billed Puda aggregate audit fees of approximately $216,000, including
        recoverable disbursements of approximately $16,000, for professional services
        rendered for the audit of its annual financial statements for the years ended
        December 31, 2003 and 2004. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
        Ming
        was directly responsible for interviewing and retaining its independent
        accountant, considering the accounting firm's independence and effectiveness,
        and pre-approving the engagement fees and other compensation to be paid to,
        and
        the services to be conducted by, the independent accountant. Zhao Ming did
        not
        delegate these responsibilities. During 2003 and 2004, Zhao Ming pre-approved
        100% of the services described above.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Legal
        Proceedings</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Puda
        is
        not involved in any lawsuit outside the ordinary course of business the
        disposition of which would have a material effect upon either its results
        of
        operations, financial position, or cash flows.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-29-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        9.01 Financial Statements and Exhibits.</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td align="right" style="WIDTH: 54pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)&#160;&#160;</font></td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Financial
                  statements of business acquired</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 18pt">&#160;</td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
                  Audited Financial Statements of Shanxi Puda Resources Co, Ltd.
                  (&#8220;Puda&#8221;) as
                  of December 31, 2004 and 2003, and for the years ended December
                  31, 2004
                  and 2003 are included following this Item
                  9.01(a).</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 18pt">&#160;</td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
                  Audited Financial Statements of Puda Investment Holding Limited
                  (&#8220;Puda
                  BVI&#8221;) and Taiyuan Putai Business Consulting Co., Ltd. (&#8220;Putai&#8221;),
                  separately, as of December 31, 2004, and for the year ended December
                  31,
                  2004 will be included in an amendment to this Current Report on
                  Form 8-K
                  which Purezza anticipates filing within the time period provided
                  by this
                  form.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
          <div>
            <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

                <tr valign="top" style="LINE-HEIGHT: 1.25">
                  <td style="WIDTH: 36pt">&#160;</td>
                  <td style="WIDTH: 18pt">&#160;</td>
                  <td>
                    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
                      Unaudited Financial Statements of Puda as of March 31, 2005,
                      and for the
                      three month periods ended March 31, 2005 and 2004 will be included
                      in an
                      amendment to this Current Report on Form 8-K which Purezza
                      anticipates
                      filing within the time period provided by this
                      form.</font></div>
                  </td>
                </tr>

            </table>
          </div>
          <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
          <div>
            <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

                <tr valign="top" style="LINE-HEIGHT: 1.25">
                  <td style="WIDTH: 36pt">&#160;</td>
                  <td style="WIDTH: 18pt">&#160;</td>
                  <td>
                    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
                      Unaudited Financial Statements of Putai and Puda BVI, separately,
                      as of
                      March 31, 2005, and for the three month period ended March
                      31, 2005 will
                      be included in an amendment to this Current Report on Form
                      8-K which
                      Purezza anticipates filing within the time period provided
                      by this
                      form.</font></div>
                  </td>
                </tr>

            </table>
          </div>
          <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        </div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-30-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>FINANCIAL
          STATEMENTS</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>December
          31, 2003 And 2004</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Together
          With Report Of</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Independent
          Registered Public Accounting Firm</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
        <div><br></div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
            </div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>INDEX
          TO FINANCIAL STATEMENTS</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr bgcolor="#ccffcc">
                <td align="justify" valign="top" width="72%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Report
                    of Independent Registered Public Accounting Firm</font></div>
                </td>
                <td align="right" valign="top" width="14%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="justify" valign="top" width="72%">&#160;</td>
                <td align="right" valign="top" width="14%">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="justify" valign="top" width="72%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Balance
                    Sheets</font></div>
                </td>
                <td align="right" valign="top" width="14%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="justify" valign="top" width="72%">&#160;</td>
                <td align="right" valign="top" width="14%">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="justify" valign="top" width="72%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Statements
                    of Operations</font></div>
                </td>
                <td align="right" valign="top" width="14%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="justify" valign="top" width="72%">&#160;</td>
                <td align="right" valign="top" width="14%">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="justify" valign="top" width="72%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Statements
                    of Changes in Owners&#8217; Equity</font></div>
                </td>
                <td align="right" valign="top" width="14%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="justify" valign="top" width="72%">&#160;</td>
                <td align="right" valign="top" width="14%">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="justify" valign="top" width="72%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Statements
                    of Cash Flows</font></div>
                </td>
                <td align="right" valign="top" width="14%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="justify" valign="top" width="72%">&#160;</td>
                <td align="right" valign="top" width="14%">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="justify" valign="top" width="72%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Notes
                    to Financial Statements</font></div>
                </td>
                <td align="right" valign="top" width="14%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">7-20</font></div>
                </td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br>&#160;</div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
            </div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>REPORT
          OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">To
          the
          Board of Directors and Owners of</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Shanxi
          Puda Resources Co., Ltd. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
          have
          audited the accompanying balance sheets of Shanxi Puda Resources Co., Ltd.
          as of
          December 31, 2003 and 2004, and the related statements of operations, changes
          in
          owners&#8217; equity, and cash flows for the years then ended. These financial
          statements are the responsibility of the Company&#8217;s management. Our
          responsibility is to express an opinion on these financial statements based
          on
          our audits. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
          conducted our audits in accordance with </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
          standards of the Public Company Accounting Oversight Board (United States).
          Those standards require that we plan and perform the audit to obtain reasonable
          assurance about whether the financial statements are free of material
          misstatement. An audit includes examining, on a test basis, evidence supporting
          the amounts and disclosures in the financial statements. An audit also
          includes
          assessing the accounting principles used and significant estimates made
          by
          management, as well as evaluating the overall financial statement presentation.
          We believe that our audits provide a reasonable basis for our
          opinion.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          our
          opinion, the financial statements referred to above present fairly, in
          all
          material respects, the financial position of Shanxi Puda Resources Co.,
          Ltd. as
          of December 31, 2003 and 2004 and the results of its operations and its
          cash
          flows for the </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">years
          then ended in conformity with accounting principles generally accepted
          in the
          United States of America.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font size="2">Moore
          Stephens</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>Certified
          Public Accountants</em></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>Hong
          Kong</em></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">June
          9,
          2005</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
        <div><br></div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-2-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>BALANCE
          SHEETS</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>December
          31, 2003 and 2004</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(In
          thousand of United States dollars)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
        <div>
          <div>
            <table cellpadding="0" cellspacing="0" width="100%">

                <tr>
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td colspan="5" valign="bottom" width="25%" style="BORDER-BOTTOM: black thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">DECEMBER
                      31,</font></div>
                  </td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                </tr>
                <tr>
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note(s)</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
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                <tr>
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                  <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">
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                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ASSETS</strong></font></div>
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                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CURRENT
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                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
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                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">913</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">313</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Short
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                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">117</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accounts
                      receivable (net)</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,340</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,722</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                </tr>
                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Notes
                      receivable - trade</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">266</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">638</font></div>
                  </td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
                      receivables</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                </tr>
                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-
                      Related parties</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,871</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,236</font></div>
                  </td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-
                      Third parties</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">68</font></div>
                  </td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                </tr>
                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Deposits
                      and prepayments</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">459</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">529</font></div>
                  </td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Inventories</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,585</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,565</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                </tr>
                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total
                      current assets</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10,188</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
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                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">PROPERTY,
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                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,085</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">974</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">INTANGIBLE
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                  <td width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">8</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">186</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">182</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
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                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">TOTAL
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                  <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11,707</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11,344</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                </tr>
                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" colspan="5" valign="bottom" width="73%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>LIABILITIES
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                  </td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                </tr>
                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CURRENT
                      LIABILITIES</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accounts
                      payable</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                </tr>
                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-
                      Related party</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">114</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">268</font></div>
                  </td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-
                      Third parties</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">565</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">448</font></div>
                  </td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                </tr>
                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Notes
                      payable</font></div>
                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">72</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                  </td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
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                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                </tr>
                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-
                      Related party</font></div>
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                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                    <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">291</font></div>
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                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accrued
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Advances
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                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Income
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                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,821</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,008</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">VAT
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                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,107</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">251</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Distribution
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                  <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,295</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">484</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
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                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total
                      current liabilities</font></div>
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                  <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5,858</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4,195</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
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                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">COMMITMENT
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                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">OWNERS&#8217;
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                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Paid-in
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                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,717</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,717</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                </tr>
                <tr bgcolor="#ccffcc">
                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Statutory
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                  </td>
                  <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12</font></div>
                  </td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
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                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Retained
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
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                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: medium none">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
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                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total
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                  <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
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                  <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc solid">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">TOTAL
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                  <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px">
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                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11,707</font></div>
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                  <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                  <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px">
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                    <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11,344</font></div>
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                  <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
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                <tr bgcolor="#ffffff">
                  <td align="left" valign="bottom" width="57%">&#160;</td>
                  <td width="2%">&#160;</td>
                  <td align="left" valign="bottom" width="1%">&#160;</td>
                  <td align="right" valign="bottom" width="11%">&#160;</td>
                  <td align="left" valign="bottom" width="2%">&#160;</td>
                  <td align="left" valign="bottom" width="1%">&#160;</td>
                  <td align="right" valign="bottom" width="11%">&#160;</td>
                  <td align="left" valign="bottom" width="2%">&#160;</td>
                  <td align="left" valign="bottom" width="1%">&#160;</td>
                  <td align="right" valign="bottom" width="11%">&#160;</td>
                  <td align="left" valign="bottom" width="1%">&#160;</td>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          accompanying notes are an integral part of these financial
          statements.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
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          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-3-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
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            </div>
          </div>
          <div id="HDR">
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>For
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
        <div>
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              <tr>
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="5" valign="bottom" width="25%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">YEAR
                    ENDED DECEMBER 31,</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
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              <tr>
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Note(s)</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NET
                    REVENUE</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13,397</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">19,735</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">COST
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                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(9,209</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(13,229</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">GROSS
                    PROFIT</font></div>
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">OPERATING
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Selling
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                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">264</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">322</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">General
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                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">277</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">203</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
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                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">414</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">TOTAL
                    OPERATING EXPENSES</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">541</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">939</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">INCOME
                    FROM OPERATIONS</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,647</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5,567</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">LOSS
                    ON SHORT TERM INVESTMENT</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">INTEREST
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                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(11</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">INCOME
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                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,636</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5,559</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">INCOME
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                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
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                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff thin solid">
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,234</font></div>
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                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,866</font></div>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
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                <td align="left" valign="bottom" width="57%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
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          <div id="PN" style="PAGE-BREAK-AFTER: always">
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              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
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          </div>
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              <tr>
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="5" valign="bottom" width="21%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">PAID-UP
                    </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CAPITAL</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="10%" style="BORDER-BOTTOM: black thin solid">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">&#160;</div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
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              <tr>
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="10%" style="BORDER-BOTTOM: medium none">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="10%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="10%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="10%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="10%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="10%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="10%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Balance,
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">22,500</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,717</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">310</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,715</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4,742</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
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                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,402</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,402</font></div>
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              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Transfer</font></div>
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                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">365</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(365</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Distribution
                    </font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,295</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,295</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Balance,
                    December 31, 2003</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">22,500</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,717</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">675</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,457</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5,849</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
                    income for 2004</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,693</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,693</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Transfer</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">568</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(568</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Distribution</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2,393</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2,393</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
              </tr>
              <tr bgcolor="#ccffcc">
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                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: black double">
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                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,717</font></div>
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                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: black double">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,189</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
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                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">7,149</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
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                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          accompanying notes are an integral part of these financial
          statements.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div><br></div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-5-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>For
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          thousand of United States dollars)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
        <div>
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              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CASH
                    FLOWS FROM OPERATING ACTIVITIES:</font></div>
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
                    income</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,402</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,693</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Adjustments
                    to reconcile net income to </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">net
                    cash used in operating activities</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Unrealized
                    loss on short term investments </font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Amortization
                    of land use right</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Depreciation</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">111</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">111</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Provision
                    for doubtful debts</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Changes
                    in operating assets and liabilities:</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Increase
                    in accounts receivable</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(847</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(383</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Increase
                    in notes receivable</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">37</font></div>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(72</font></div>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Increase
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">63</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">73</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Decrease
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                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(146</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(368</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Decrease)/increase
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(293</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">147</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Increase
                    in income tax payable</font></div>
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                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,235</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">187</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Increase/(decrease)
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">712</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(856</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">226</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,725</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CASH
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Payment
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                <td width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(121</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
              </tr>
              <tr bgcolor="#ccffcc">
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(121</font></div>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">CASH
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
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              <tr bgcolor="#ffffff">
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                <td width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #000000 thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
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                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #000000 thin solid">
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
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                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3,204</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
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              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
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                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px">
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">226</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px">
                  </div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(600</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px">
                  </div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">)</font></div>
                </td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
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                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">687</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">913</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
                    and cash equivalents at end of year</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">913</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">313</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Supplemental
                    schedule of cash flow information:</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
                    paid during the year for:</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Interest</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Income
                    taxes</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,678</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          accompanying notes are an integral part of these financial
          statements.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-6-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>1.
          The Company</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Shanxi
          Puda Resources Co., Ltd. (&#8220;the Company&#8221;) was established on 7 June 1995 as a
          company with limited liability under the laws of The People&#8217;s Republic of China
          (&#8220;PRC&#8221;). The Company mainly processes and washes raw coal and sells from its
          plants in Shanxi Province, high-quality, low sulfur refined coal for industrial
          clients mainly in Central and Northern China. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          Company has a registered capital of RMB22,500,000 (US$2,217,000) which
          is fully
          paid-up. The owners of the Company are Mr. Zhao Ming (80%) and Mr. Zhao
          Yao
          (20%).</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>2.
          Summary of Significant Accounting Policies</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(a)
          Basis of Presentation</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          accompanying financial statements were prepared in accordance with the
          accounting principles generally accepted in the United States of America
          (&#8220;US
          GAAP&#8221;). </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(b)
          Use of Estimates</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          preparing financial statements in conformity with accounting principles
          generally accepted in the United States of America, management is required
          to
          make estimates and assumptions that affect the reported amounts of assets
          and
          liabilities and the disclosure of contingent assets and liabilities at
          the date
          of the financial statements and revenues and expenses during the reported
          periods. Significant estimates include depreciation and allowance for doubtful
          accounts receivable. Actual results could differ from those
          estimates.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(c)
          Cash and Cash Equivalents</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          Company considers all highly liquid investments with original maturities
          of
          three months or less at the time of purchase to be cash equivalents. As
          of
          December 31, 2003 and 2004 the Company did not have any cash
          equivalents.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(d)
          Short-term Investments</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          Company classifies its marketable securities as trading securities. Trading
          securities are carried at readily determinable fair value, with the unrealized
          or realized gains and losses, if any, reported in other income in income
          statement. The cost of securities sold is based on the specific-identification
          method. </font></div>
        <div><br></div>
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            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(e)
          Allowance for Doubtful Accounts</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          Company recognizes an allowance for doubtful accounts to ensure accounts
          receivable are not overstated due to uncollectibility. An allowance for
          doubtful
          accounts is maintained for all customers based on a variety of factors,
          including the length of time the receivables are past due, significant
          one-time
          events and historical experience. An additional reserve for individual
          accounts
          is recorded when the Company becomes aware of a customer&#8217;s inability to meet its
          financial obligations, such as in the case of bankruptcy filings or
          deterioration in the customer&#8217;s operating results or financial position. If
          circumstances related to customers change, estimates of the recoverability
          of
          receivables would be further adjusted. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(f)
          Inventories</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Inventories
          comprise raw materials and finished goods and are stated at the lower of
          cost or
          market. Substantially all inventory costs are determined using the weighted
          average basis. Costs of finished goods include direct labor, direct materials,
          and production overhead before the goods are ready for sale. Inventory
          costs do
          not exceed net realizable value.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(g)
          Property, Plant and Equipment, Net</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Property,
          plant and equipment is stated at cost. Depreciation is provided principally
          by
          use of the straight-line method over the useful lives of the related assets.
          Expenditures for maintenance and repairs, which do not improve or extend
          the
          expected useful life of the assets, are expensed to operations while major
          repairs are capitalized.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Management
          considers that they have 10% residual value for buildings, and 5% residual
          value
          for other property, plant and equipment. The estimated useful lives are
          as
          follows:</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Building
          and
          facility&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
          </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">20
          years</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Machinery
          and
          equipment&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
          </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10
          years</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Motor
          vehicles&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
          </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10
          years</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Office
          equipment and
          others&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
          </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10
          years</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          gain
          or loss on disposal of property, plant and equipment is the difference
          between
          the net sales proceeds and the carrying amount of the relevant assets,
          and, if
          any, is recognized in the statements of operations.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(h)
          Land Use Rights and Amortization</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Land
          use
          right is stated at cost, less amortization. Amortization of land use right
          is
          calculated on the straight-line method, based on the period over which
          the right
          is granted by the relevant authorities in Shanxi, PRC.</font></div>
        <div><br></div>
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            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(i)
          Impairment of Assets</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          accordance with Statement of Financial Accounting Standards (&#8216;SFAS&#8221;) No. 144,
          "Accounting for Impairment or Disposal of Long-Lived Assets", the Company
          evaluates its long-lived assets to determine whether later events and
          circumstances warrant revised estimates of useful lives or a reduction
          in
          carrying value due to impairment. If indicators of impairment exist and
          if the
          value of the assets is impaired, an impairment loss would be
          recognized.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(j)
          Income Taxes</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          Company accounts for income taxes under SFAS No. 109, "Accounting for Income
          Taxes". Under SFAS No. 109, deferred tax assets and liabilities are recognized
          for the future tax consequences attributable to differences between the
          financial statement carrying amounts of existing assets and liabilities
          and
          their respective tax bases. Deferred tax assets and liabilities are measured
          using enacted tax rates expected to apply to taxable income in the years
          in
          which those temporary differences are expected to be recovered or settled.
          Under
          SFAS No. 109, the effect on deferred tax assets and liabilities of a change
          in
          tax rates is recognized in income in the period that includes the enactment
          date.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          Company reviewed the differences between tax basis under PRC tax laws and
          financial reporting under PRC GAAP, and no material differences were found,
          thus, there were no deferred tax assets or liabilities as of December 31,
          2003
          and 2004 for the Company.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under
          current PRC tax laws, no tax is imposed in respect to distributions paid
          to
          owners except individual income tax.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(k)
          Revenue Recognition</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Revenue
          from goods sold is recognized when title has passed to the purchaser, which
          generally is at the time of delivery. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(l)
          Foreign Currency Transactions</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          Company&#8217;s functional currency is Renminbi (&#8220;RMB&#8221;) and its reporting currency is
          U.S. dollars. The Company&#8217;s balance sheet accounts are translated into U.S.
          dollars at the year-end exchange rates and all revenue and expenses are
          translated into U.S. dollars at the average exchange rates prevailing during
          the
          periods in which these items arise. Translation gains and losses are deferred
          and accumulated as a component of other comprehensive income in owners&#8217; equity.
          Transaction gains and losses that arise from exchange rate fluctuations
          from
          transactions denominated in a currency other than the functional currency
          are
          included in the statement of operations as incurred. The translation and
          transaction gains and losses were immaterial for the years ended December
          31,
          2003 and 2004.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          PRC
          government imposes significant exchange restrictions on fund transfers
          out of
          the PRC that are not related to business operations. These restrictions
          have not
          had a material impact on the Company because it has not engaged in any
          significant transactions that are subject to the restrictions.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div><br></div>
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            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-9-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(m)
          Fair Value of Financial Instruments </strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SFAS
          No.
          107, &#8220;Disclosures about Fair Values of Financial Instruments&#8221;, requires
          disclosing fair value to the extent practicable for financial instruments
          that
          are recognized or unrecognized in the balance sheet. The fair value of
          the
          financial instruments disclosed herein is not necessarily representative
          of the
          amount that could be realized or settled, nor does the fair value amount
          consider the tax consequences of realization or settlement. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For
          certain financial instruments, including cash, accounts, related party
          and other
          receivables, accounts payable, other payables and accrued expenses, it
          was
          assumed that the carrying amounts approximate fair value because of the
          near
          term maturities of such obligations. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(n)
          Earnings Per Share</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Basic
          earnings per share is computed by dividing the earnings for the year by
          the
          weighted average number of common shares outstanding for the year. Diluted
          earnings per share reflects the potential dilution of securities by including
          other potential common stock, including stock options and warrants, in
          the
          weighted average number of common shares outstanding for a period, if dilutive.
          </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For
          the
          years ended December 31, 2003 and 2004, earnings per share are not shown
          as
          there are no shares outstanding. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(o)
          Accumulated Other Comprehensive Income</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accumulated
          other comprehensive income represents the change in equity of the Company
          during
          the periods presented from foreign currency translation adjustments. These
          transactions are deemed immaterial for the years presented.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>3.
          Allowance for Doubtful Receivables</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Details
          of allowance for doubtful receivables deducted from accounts receivable
          are as
          follows:-</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="5" valign="bottom" width="25%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
                    31,</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Balance,
                    beginning of year</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">15</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">28</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Additions</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Balance,
                    end of year</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">28</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">29</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%">&#160;</td>
                <td width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          Company did not have any bad debts in the years ended December 31, 2003
          and
          2004.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div><br></div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-10-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>4.
          Notes Receivable - Trade</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Notes
          receivable are issued by banks for settlement of accounts receivable from
          customers. They are not factored and are non-interest bearing. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>5.
          Related Party Transactions </strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
          of
          December 31, 2003 and 2004, the Company had the following amounts due from/to
          related parties:-</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="5" valign="bottom" width="25%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
                    31,</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
                    receivable from Shanxi Puda Resources Group Limited (&#8220;Puda Group&#8221;), a
                    related company with common owners</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,871</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,234</font></div>
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              <tr bgcolor="#ffffff">
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                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2</font></div>
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,871</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,236</font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accounts
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                    (&#8220;Jucai
                    <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Coal</font>&#8221;),
                    a related company with common owner</font></div>
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px">
                  </div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px">
                  </div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">114</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px">
                  </div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px">
                  </div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">268</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
                    payable to an owner, Zhao Yao</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">186</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">197</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%">&#160;</td>
                <td width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          balances are unsecured, interest-free and there are no fixed terms for
          repayment. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          amount payable to Zhao Yao represents land use right paid by him on behalf
          of
          the Company (see Note 8).</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          2001,
          the Company entered into agreements with Puda Group to lease an office
          and
          certain equipment. In the years ended December 31, 2003 and 2004, rental
          expenses payable to Puda Group were US$24,000 and US$24,000, respectively,
          which
          were charged to cost of revenue and general and administrative expenses
          in the
          statements of operations (see Note 11).</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div><br></div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-11-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>5.
          Related Party Transactions (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By
          an
          agreement entered into between the Company and Puda Group on April 25,
          2005,
          Puda Group agreed to pay all the tax liabilities (including surcharges
          and
          penalties) of the Company with retrospective effect from its establishment
          to
          December 31, 2004. As at December 31, 2003 and 2004, the Company has paid
          US$2,800,000 and US$5,768,000, respectively, to Puda Group for payment
          of income
          taxes and value-added tax (&#8220;VAT&#8221;). In December 2004, Puda Group paid the
          Company&#8217;s income taxes of US$1,678,000 and VAT of US$1,950,000 to the China Tax
          Bureau. In April 2005, Puda Group paid the Company&#8217;s VAT of US$251,000 to the
          China Tax Bureau. The directors expect that the Company&#8217;s income tax for the
          year 2004 will be paid to the China Tax Bureau in July 2005 (see Note
          10).</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          2001,
          the Company entered into an agreement with Jucai <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Coal
          </font>to lease a coal washing plant. In the years ended December 31, 2003
          and
          2004, rental expenses in the amounts of US$604,000 and US$604,000, respectively,
          were paid to&#160;Jucai Coal and these rental expenses were charged to
          cost of
          revenue in the statements of operations (see Note 11).</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          the
          years ended December 31, 2003 and 2004, the Company purchased raw coal
          from
          Jucai Coal in the amounts of US$1,434,000 and US$1,556,000,
          respectively.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>6.
          Inventories</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
          of
          December 31, 2003 and 2004, inventories consist of the following:</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="5" valign="bottom" width="25%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
                    31,</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Raw
                    materials</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">776</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,557</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Finished
                    goods</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,809</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,008</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,585</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,565</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
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                <td width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
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          2004.</font></div>
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        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
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            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
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          <div id="HDR">
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            </div>
          </div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>7.
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                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
                    31,</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
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              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
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                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
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              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Cost</strong></font></div>
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                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Buildings
                    and facility</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">427</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">427</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Machinery
                    equipment</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">633</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">633</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Motor
                    vehicles</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">254</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">254</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Office
                    equipment and others</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">76</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">76</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,390</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,390</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Accumulated
                    depreciation</strong></font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Buildings
                    and facility</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">61</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">80</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Machinery
                    equipment</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">160</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">221</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Motor
                    vehicles</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">69</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">93</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Office
                    equipment and others</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">15</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">22</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">305</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">416</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
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                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Carrying
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                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Buildings
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">366</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">347</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Machinery
                    equipment</font></div>
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                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">473</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">412</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Motor
                    vehicles</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">185</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">161</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Office
                    equipment and others</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">61</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">54</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,085</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">974</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Depreciation
          expense for each of the years ended December 31, 2003 and 2004 was approximately
          US$111,000 and US$111,000, respectively. For 2004, the amount included
          in cost
          of sales and general and administrative expenses was approximately US$86,000
          (2003: US$86,000) and US$25,000 (2003: US$25,000), respectively.</font></div>
        <div><br></div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-13-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>8.
          Intangible Assets</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="5" valign="bottom" width="25%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Land
                    use right</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
                    31,</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td valign="bottom" width="71%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cost</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">197</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">197</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accumulated
                    amortization</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">15</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Carrying
                    value</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">186</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">182</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%">&#160;</td>
                <td width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Land
          use
          right is located in Shanxi, PRC and is amortized over 50 years up to March
          2051
          (see Note 5). </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Amortization
          expense for the years ended December 31, 2003 and 2004 was approximately
          US$4,000 and US$3,000, respectively. The estimated aggregate amortization
          expense for the five years ending December 31, 2005, 2006, 2007, 2008 and
          2009
          amounts to approximately US$4,000, US$4,000, US$4,000, US$4,000 and US$4,000,
          respectively.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>9.
          Notes Payable</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Notes
          payable as of December 31, 2003 were unsecured. For the year ended December
          31,
          2003, all payments were made on a timely basis and no interest was assessed.
          As
          of December 31, 2004, there were no notes payable.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>10.
          Income and Other Taxes Payable</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By
          an
          agreement entered into between the Company and Puda Group on April 25,
          2005,
          Puda Group agreed to pay all the tax liabilities (including surcharges
          and <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">penalties</font>)
          on behalf of the Company with retrospective effect from its establishment
          to
          December 31, 2004. The Company has advanced funds to Puda Group for payment
          of
          income tax and VAT (see Note 5).</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div><br></div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-14-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>11.
          Commitments and Contingencies</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
          of
          December 2003 and 2004, the Company leased equipment, plant and office
          premises
          under several operating lease agreements expiring in 2005, 2006 and 2008,
          respectively (see Note 5).</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          future minimum lease payments under the above-mentioned leases as of December
          31, 2003 and 2004 are as follows:-</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div align="center">
          <table cellpadding="0" cellspacing="0" width="50%">

              <tr>
                <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
                    31, 2004</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Year</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2005</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">628</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2006</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">560</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2007</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2008</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,200</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="30%">&#160;</td>
                <td width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          above
          future lease payments include amounts payable to Puda Group and Jucai Coal.
          The
          amounts payable to Puda Group for the years ending December 31, 2005, 2006
          2007
          and 2008 are US$24,000, US$6,000, US$6,000 and US$6,000, respectively.
          The
          amounts payable to Jucai Coal for the years ending December 31, 2005, 2006,
          2007
          and 2008 are US$604,000, US$554,000, US$nil and US$nil,
          respectively.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
          of
          December 2003 and 2004, the </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Company
          did not have any contingent liabilities.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>12.
          Profit Appropriation</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          accordance with PRC regulations, the Company is required to make appropriations
          to the statutory surplus reserve fund, based on after-tax net income determined
          in accordance with PRC GAAP. According to the Memorandum and Articles of
          Association of the Company, appropriation to the statutory surplus reserve
          fund
          should be at least 10% of the after-tax net income determined in accordance
          with
          the PRC GAAP until the reserve fund is equal to 50% of the entity&#8217;s registered
          capital. Appropriations to the statutory public welfare fund should be
          at least
          5% of the after-tax net income determined in accordance with the PRC GAAP.
          Statutory surplus reserve is established for the purpose of remedying the
          Company&#8217;s losses, expanding operations, or increasing registered capital, and is
          non-distributable other than in liquidation. </font></div>
        <div><br>&#160;</div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-15-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>13.
          Other Operating Expenses</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">These
          represent mainly charges incurred for a potential public listing in the
          United
          States of America.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>14.
          Taxation</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
          to the PRC Income Tax Laws, the Company is subject to enterprise income
          tax at a
          statutory rate of 33% (30% national income tax plus 3% local income tax).
          </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Details
          of income taxes in the statements of operations are as follows:-</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="5" valign="bottom" width="25%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
                    31,</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: medium none">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: medium none">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Current
                    year provision</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
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                <td width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="2%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
                <td align="right" valign="bottom" width="11%">&#160;</td>
                <td align="left" valign="bottom" width="1%">&#160;</td>
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              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
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                </td>
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              </tr>
              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
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              <tr>
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: medium none">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: medium none">
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                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
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                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Income
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: #ccffcc">
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                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effect
                    of permanent differences</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">34</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black thin solid">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">32</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="71%" style="BORDER-BOTTOM: #ccffcc solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Income
                    tax at effective rate</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc thin solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,234</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black double">&#160;</td>
                <td align="right" valign="bottom" width="11%" style="BORDER-BOTTOM: black double">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,866</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc solid">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
        <div><br></div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
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            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-16-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>15.
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          Company operates principally in the PRC and grants credit to its customers
          in
          this geographic region. Although the PRC is economically stable, it is
          always
          possible that unanticipated events in foreign countries could disrupt the
          Company&#8217;s operations.</font></div>
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          cash in
          banks of approximately US$313,000. The Company does not require collateral
          or
          other securities to support financial instruments that are subject to credit
          risk.</font></div>
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        <div>
          <table cellpadding="0" cellspacing="0" width="100%">

              <tr>
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="11" valign="bottom" width="53%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">December
                    31,</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr>
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Customers</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="5" valign="bottom" width="26%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2003</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
                <td colspan="5" valign="bottom" width="25%" style="BORDER-BOTTOM: black thin solid">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2004</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff thin solid">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font size="2">%</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">US$&#8217;000</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="11%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">
                    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font size="2">%</font></div>
                  </div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Customer
                    A</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,116</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">16</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2,056</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Customer
                    B</font></div>
                </td>
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                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
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                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
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                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
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                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
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                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">15</font></div>
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                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff solid">
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              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">%</font></div>
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                <td colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
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                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc">
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
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                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">
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                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">16</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Customer
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                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">362</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">15</font></div>
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                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Customer
                    C</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">262</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">451</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">16</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Customer
                    I</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">250</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>
              <tr bgcolor="#ffffff">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ffffff">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Customer
                    E</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">327</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ffffff">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff">&#160;</td>
              </tr>
              <tr bgcolor="#ccffcc">
                <td align="left" valign="bottom" width="43%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Customer
                    J</font></div>
                </td>
                <td width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">--</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">323</font></div>
                </td>
                <td align="left" valign="bottom" width="2%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
                <td align="left" colspan="2" valign="bottom" width="12%" style="BORDER-BOTTOM: #ccffcc">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12</font></div>
                </td>
                <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc">&#160;</td>
              </tr>

          </table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div><br></div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-17-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>16.
          Retirement Benefits</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          full-time employees of the Company are entitled to staff welfare benefits
          including medical care, casualty, housing benefits, education benefits,
          unemployment insurance and pension benefits through a Chinese
          government-mandated multi-employer defined contribution plan. The Company
          is
          required to accrue the employer-portion for these benefits based on certain
          percentages of the employees&#8217; salaries. The total provision for such employee
          benefits was US$63,000 and US$73,000 for the year ended December 31, 2003
          and
          2004, respectively and were recorded as accrued expenses. As of December
          31,
          2003 and 2004, the total amount included in accrued expenses for the provision
          is US$175,000 and $US$248,000, respectively. The Company is required to
          make
          contributions to the plans out of the amounts accrued for all staff welfare
          benefits except for education benefits. The contributions have not yet
          been made
          to the government social welfare organization for the year ended December
          31,
          2003 and 2004, respectively. The PRC government is responsible for the
          staff
          welfare benefits including medical care, casualty, housing benefits,
          unemployment insurance and pension benefits to be paid to these employees.
          The
          Company is responsible for the education benefits to be paid.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          the
          EITF Consensus 92-13, The Emerging Issues Task Force (&#8220;EITF&#8221;) provides guidance
          regarding accounting for estimated payments in connection with the Coal
          industry
          Retiree Health Benefit Act of 1992, which requires enterprises that have
          ongoing
          operations in the coal industry to account for their obligations under
          the Act
          as either participation in a multi-employer plan or as a liability. The
          Company
          is only required to comply with the aforementioned separate contribution
          plan
          according to local statutory requirements regarding retiree health benefits,
          accordingly, the Consensus does not have impact on the Company&#8217;s financial
          statements presented.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>17.</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Black
          Lung Benefits</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          the
          United States of America, companies are responsible under the Federal Coal
          Mine
          Health and Safety Act of 1969, as amended, and various states&#8217; statutes for the
          payment of medical and disability benefits to employees and their dependents
          resulting from occurrences of coal worker&#8217;s pneumoconiosis disease (black lung).
          In the PRC, besides a uniform contribution plan described in note 12, there
          is
          no such special Act or regulatory requirements to cover occurrences of
          coal
          worker&#8217;s black lung. The Company provides no provision for its workers&#8217; black
          lung benefits inasmuch as the aforesaid Act does not apply to the
          Company.</font></div>
        <div>&#160;</div>
        <div>&#160;</div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
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            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-18-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>18.
          New Accounting Pronouncements</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          January 2003, the Financial Accounting Standards Board (&#8220;FASB&#8221;) issued
          interpretation No. 46 &#8220;Consolidation of Variable Interest Entities, an
          Interpretation of ARB No. 51&#8221; (&#8220;FIN 46&#8221;). FIN 46 clarifies when a company should
          consolidate in its financial statements the assets, liabilities and activities
          of a variable interest entity. FIN 46 provides general guidance as to the
          definition of a variable interest entity and requires a variable interest
          entity
          to be consolidated if a company absorbs the majority of the variable interest
          entity&#8217;s expected losses, or is entitled to receive majority of the variable
          interest entity&#8217;s residual returns, or both. In December 2003, the FASB issued a
          revised interpretation of FIN 46 (&#8220;FIN 46-R&#8221;), which supersedes FIN 46 and
          clarifies and expands current accounting guidance for variable interest
          entities. Both interpretations are effective immediately for any variable
          interest entity created subsequent to January 31, 2003, and for variable
          interest entities created before February 1, 2003, no later than the end
          of the
          first reporting period after March 15, 2004. The adoption of FIN 46-R has
          no
          impact on the Company&#8217;s financial statements.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          April
          2003, the FASB issued SFAS No. 149, "Amendment of Statement 133 on Derivative
          Instruments and Hedging Activities", which clarifies financial accounting
          and
          reporting for derivative instruments, including certain derivative instruments
          embedded in other contracts and for hedging activities under SFAS No. 133,
          "Accounting for Derivative Instruments and Hedging Activities." SFAS No.
          149 is
          effective for contracts entered into or modified after June 30, 2003 and
          for
          hedging relationships designated after June 30, 2003. The adoption of SFAS
          No.
          149 has no impact on the Company&#8217;s financial reporting and
          disclosures.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          May
          2003, the FASB issued SFAS No. 150 &#8220;Accounting for Certain Financial Instruments
          with Characteristics of Both Liabilities and Equity&#8221; (&#8220;SFAS No. 150&#8221;). SFAS No.
          150 revises the accounting for certain financial instruments that previously
          could be classified as liabilities (or, in some circumstances, assets)
          in the
          statement of financial condition. SFAS No. 150 also requires disclosure
          of the
          terms of those instruments and settlement alternatives. SFAS No. 150 generally
          is effective for all financial instruments entered into or modified after
          May
          31, 2003, and is otherwise effective at the beginning of the first interim
          period beginning after June 15, 2003. The adoption of SFAS No. 150 has
          no impact
          on the Company&#8217;s financial statements.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          December 2003, the FASB issued SFAS No. 132R &#8220;Employers&#8217; Disclosures about
          Pensions and Other Postretirement Benefits&#8221; (&#8220;SFAS No. 132R&#8221;). This Statement
          revises disclosures by employers about pensions and other postretirement
          benefits. The additional disclosures are about the asset, obligations,
          cash
          flows and net periodic benefit cost of defined benefit pension plans and
          other
          defined benefit postretirement plans. The required information must be
          provided
          separately for pension plans and other postretirement benefit plans. New
          disclosures for interim periods beginning after December 15, 2003 are also
          required by SFAS No. 132R. The adoption of SFAS No. 132R has no impact
          on the
          Company&#8217;s financial statements.</font></div>
        <div>&#160;</div>
        <div>&#160;</div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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            </div>
          </div>
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            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-19-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
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            </div>
          </div>
        </div>
        <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SHANXI
          PUDA RESOURCES CO., LTD.</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>NOTES
          TO FINANCIAL STATEMENTS (continued)</strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>18.
          New Accounting Pronouncements (continued) </strong></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          December 2003, the staff of the Securities and Exchange Commission (&#8220;SEC&#8221;)
          issued Staff Accounting Bulletin (&#8220;SAB&#8221;) No. 104, &#8220;Revenue Recognition, which
          supersedes SAB 101, &#8220;Revenue Recognition in Financial Statements.&#8221; The primary
          purpose of SAB 104 is to rescind the accounting guidance included in SAB
          101
          about multiple element revenue arrangements. SAB 104 also revises the SEC&#8217;s
&#8220;Revenue Recognition in Financial Statements Frequently Asked Questions
          and
          Answers that have been codified in Topic 13. SAB 104 was effective immediately
          upon issuance and did not have a material impact of the Company&#8217;s financial
          reporting and disclosures. </font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
          FASB
          has issued SFAS No. 148 &#8220;Accounting for Stock-Based Compensation - Transition
          and Disclosures&#8221;. SFAS No. 148 amends SFAS No. 123, &#8220;Accounting for Stock-Based
          Compensation&#8221;, to provide alternative methods of transition for a voluntary
          change to the fair value based method of accounting for stock-based employee
          compensation. In addition, SFAS No. 148 amends the disclosure requirements
          of
          SFAS No. 123 to require prominent disclosures in both annual and interim
          financial statements about the method of accounting for stock-based employee
          compensation and the effect of the method used on reported results. The
          Company
          has adopted the disclosure requirements of SFAS No. 148. The Company has
          no
          stock-based compensation.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          December 2004, the FASB issued SFAS No. 123R, "Share-Based Payment, an
          Amendment
          of SFAS No. 123." SFAS No. 123R requires companies to recognize in the
          statement
          of operations the grant-date fair value of stock options and other equity-based
          compensation issued to employees. The Company has no stock-based
          compensation.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
          December 2004, the FASB issued SFAS No. 153, "Exchanges of Non-monetary
          Assets."
          The Statement is an amendment of APB Opinion No. 29. SFAS No. 153 eliminates
          the
          exception for non-monetary exchanges of similar productive assets and replaces
          it with a general exception for exchanges of non-monetary assets that do
          not
          have commercial substance. The adoption of SFAS No. 153 has no impact on
          the
          Company&#8217;s financial statements.</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
          <div id="FTR">
            <div id="GLFTR" style="WIDTH: 100%" align="left">
            </div>
          </div>
          <div id="PN" style="PAGE-BREAK-AFTER: always">
            <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-20-</font></div>
            <div style="WIDTH: 100%; TEXT-ALIGN: center">
              <hr style="COLOR: black" noshade size="2">
            </div>
          </div>
          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right">
            </div>
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      </div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">&#160;</div>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td align="right" style="WIDTH: 54pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)&#160;&#160;</font></td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Pro
                  forma financial information</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 18pt">&#160;</td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
                  Unaudited Pro Forma Financial Statements of Puda, Puda BVI and
                  Putai as of
                  December 31, 2004, and for the period ended December 31, 2004 will
                  be
                  included in an amendment to this Current Report on Form 8-K which
                  Purezza
                  anticipates filing within the time period provided by this
                  form.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 36pt">&#160;</td>
              <td style="WIDTH: 18pt">&#160;</td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
                  Unaudited Pro Forma Financial Statements of Purezza, Puda, Puda
                  BVI and
                  Putai as of December 31, 2004, and for the period ended December
                  31, 2004
                  will be included in an amendment to this Current Report on Form
                  8-K which
                  Purezza anticipates filing within the time period provided by this
                  form.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-31-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td align="right" style="WIDTH: 54pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)&#160;&#160;</font></td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Exhibits</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" bgcolor="#ccffcc" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 54pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.1</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Certificate
                  of Designations, Preferences, Rights and Limitations of Series
                  A
                  Convertible Preferred Stock of Purezza Filed June 24,
                  2005</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 54pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.1</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Technology
                  License Agreement dated June 24, 2005 between Puda and Putai
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" bgcolor="#ccffcc" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 54pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.2</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Operating
                  Agreement dated June 24, 2005 between Puda, Putai, Zhao Ming and
                  Zhao Yao
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 54pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.3</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Exclusive
                  Consulting Agreement dated June 24, 2005 between Puda and Putai
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" bgcolor="#ccffcc" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 54pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.4</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Exclusive
                  Option Agreement dated June 24, 2005 between Puda, Putai, Zhao
                  Ming and
                  Zhao Yao </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 54pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.5</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Authorization
                  dated June 24, 2005 between Puda, Putai and Zhao Ming
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" bgcolor="#ccffcc" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 54pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.6</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Authorization
                  dated June 24, 2005 between Puda, Putai and Zhao Yao
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 54pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.7</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Financial
                  Advisory Agreement dated June 29, 2005, between Purezza and Keating
                  Securities, LLC. </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" bgcolor="#ccffcc" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 54pt">&#160;</td>
              <td style="WIDTH: 36pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.1</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Press
                  Release announcing the Closing filed on July
                  18,&#160;2005.</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-32-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SIGNATURES</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
        to the requirements of the Securities Exchange Act of 1934, Purezza Group,
        Inc.
        has duly caused this report to be signed on its behalf by the undersigned
        hereunto duly authorized.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
        <div>
          <table align="center" bgcolor="#ffffff" border="0" cellpadding="0" cellspacing="0" width="100%">

              <tr valign="top" bgcolor="#ffffff">
                <td width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td width="49%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              </tr>
              <tr valign="top" bgcolor="#ffffff">
                <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td colspan="2"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>PUREZZA
                  GROUP, INC.</strong></font></td>
              </tr>
              <tr valign="top" bgcolor="#ffffff">
                <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;<br>&#160;</font></td>
                <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;<br>&#160;</font></td>
                <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;<br>&#160;</font></td>
              </tr>
              <tr valign="top" bgcolor="#ffffff">
                <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date:&#160;July
                  18, 2005</font></td>
                <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By:&#160;&#160;</font></td>
                <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">/s/&#160;Zhao
                  Ming</font></td>
              </tr>
              <tr valign="top" bgcolor="#ffffff">
                <td colspan="2"><font style="FONT-FAMILY: Times New Roman" size="1">&#160;</font></td>
                <td align="left">
                  <hr style="COLOR: #000000" align="left" noshade size="2" width="80%">
                </td>
              </tr>
              <tr valign="top" bgcolor="#ffffff">
                <td colspan="2"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
                <td>
                  <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Zhao
                    Ming, Chairman</font></div>
                  <div><font size="2">Chief Executive Officer and
                    President</font></div>
                </td>
              </tr>

          </table>
        </div><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">-33-</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>EXHIBIT
        INDEX</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 144pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div>
        <div>
          <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

              <tr valign="top" bgcolor="#ffffff" style="LINE-HEIGHT: 1.25">
                <td style="WIDTH: 18pt">&#160;</td>
                <td style="WIDTH: 90pt"><u><font size="2">Exhibit Number</font></u></td>
                <td><u><font size="2">Description of
                  Exhibit</font></u></td>
              </tr>

          </table>
        </div>
        <div>
          <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

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                <td style="WIDTH: 18pt">&#160;</td>
                <td style="WIDTH: 90pt">
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.1</font></div>
                </td>
                <td>
                  <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Certificate
                    of Designations, Preferences, Rights and Limitations of Series
                    A
                    Convertible Preferred Stock of Purezza Filed June 24,
                    2005</font></div>
                </td>
              </tr>

          </table>
        </div>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 18pt">&#160;</td>
              <td style="WIDTH: 90pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.1</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Technology
                  License Agreement dated June 24, 2005 between Puda and Putai
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" bgcolor="#ccffcc" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 18pt">&#160;</td>
              <td style="WIDTH: 90pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.2</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Operating
                  Agreement dated June 24, 2005 between Puda, Putai, Zhao Ming and
                  Zhao Yao
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 18pt">&#160;</td>
              <td style="WIDTH: 90pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.3</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Exclusive
                  Consulting Agreement dated June 24, 2005 between Puda and Putai
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" bgcolor="#ccffcc" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 18pt">&#160;</td>
              <td style="WIDTH: 90pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.4</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Exclusive
                  Option Agreement dated June 24, 2005 between Puda, Putai, Zhao
                  Ming and
                  Zhao Yao </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 18pt">&#160;</td>
              <td style="WIDTH: 90pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.5</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Authorization
                  dated June 24, 2005 between Puda, Putai and Zhao Ming
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

            <tr valign="top" bgcolor="#ccffcc" style="LINE-HEIGHT: 1.25">
              <td style="WIDTH: 18pt">&#160;</td>
              <td style="WIDTH: 90pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.6</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Authorization
                  dated June 24, 2005 between Puda, Putai and Zhao Yao
                  </font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

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              <td style="WIDTH: 18pt">&#160;</td>
              <td style="WIDTH: 90pt">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.7</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Financial
                  Advisory Agreement dated June 29, 2005, between Purezza and Keating
                  Securities, LLC. </font></div>
              </td>
            </tr>

        </table>
      </div>
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                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.1</font></div>
              </td>
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                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Press
                  Release announcing the Closing filed on July 18,
                  2005.</font></div>
              </td>
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{"company-data": {"conformed-name": "PUREZZA GROUP INC", "cik": "0001162747", "assigned-sic": "2800", "irs-number": "651129912", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "333-85306", "film-number": "05958391"}, "business-address": {"street1": "5100 N FEDERAL HWY # 409", "city": "FT LAUDERDALE", "state": "FL", "zip": "33308", "phone": "9544938900"}}
UNITED
        STATES
SECURITIES
        AND EXCHANGE COMMISSION
Washington,
        D.C. 20549
_____________________________
FORM
        8-K
CURRENT
        REPORT
PURSUANT
        TO SECTION 13 OR 15(d) OF THE
SECURITIES
        EXCHANGE ACT OF 1934
Date
        of
        Report:
(Date
        of
        earliest event reported)
July
        15, 2005
____________________________
Purezza
        Group, Inc.
(Exact
        name of registrant as specified in its charter)
Florida
(State
        or
        other Jurisdiction of Incorporation or Organization)
333-85306
(Commission
                  File Number)
65-1129912
(IRS
                  Employer Identification No.)
426
                  Xuefu Street, Taiyuan, Shanxi Province, China
(Address
                  of Principal Executive Offices and zip code)
86
        351 2281300
(Registrant's
        telephone
number,
        including area code)
936A
        Beachland Boulevard, Suite 13
Vero
        Beach, FL 32963
(Former
        Name or Former Address, if Changed Since Last Report)
Check
        the
        appropriate box below if the Form 8-K filing is intended to simultaneously
        satisfy the filing obligation of registrant under any of the following
        provisions:
[
         ]
        Written communications pursuant to Rule 425 under the Securities Act (17
        CFR
        230.425)
[ 
        ]
        Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17
        CFR
        240.14a-12(b))
[ 
        ]
        Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
        Act
        (17 CFR 240.14d-2(b))
[ 
        ]
        Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
        Act
        (17 CFR 240.13e-4(c))
Safe
        Harbor Statement under the Private Securities Litigation Reform Act of
        1995
Information
        included in this Form 8-K may contain forward-looking statements within the
        meaning of Section 27A of the Securities Act and Section 21E of the Securities
        Exchange Act of 1934, as amended (the "Exchange Act"). This information may
        involve known and unknown risks, uncertainties and other factors which may
        cause
        the actual results, performance or achievements of Purezza Group, Inc.
        ("Purezza") and Shanxi Puda Resources Co, Ltd. ("Puda") to be materially
        different from future results, performance or achievements expressed or implied
        by any forward-looking statements. Forward-looking statements, which involve
        assumptions and describe the Purezza's and Puda's future plans, strategies and
        expectations, are generally identifiable by use of the words "may," "should,"
        "expect," "anticipate," "estimate," "believe," "intend" or "project" or the
        negative of these words or other variations on these words or comparable
        terminology. Forward-looking statements are based on assumptions that may
        be
        incorrect, and there can be no assurance that any projections or other
        expectations included in any forward-looking statements will come to pass.
        Purezza's and Puda's actual results could differ materially from those expressed
        or implied by the forward-looking statements as a result of various factors.
        Except as required by applicable laws, Purezza undertakes no obligation to
        update publicly any forward-looking statements for any reason, even if new
        information becomes available or other events occur in the future.
Section
        1 - Registrants' Business and Operations
Item
        1.01 Entry into a Material Definitive Agreement.
Reference
        is made to the disclosure set forth under Items 2.01 and 8.01 of this Current
        Report on Form 8-K, which disclosure is incorporated herein by
        reference.
On
        June
        24, 2005, Taiyuan Putai Business Consulting Co., Ltd. ("Putai"), a limited
        liability company under the Company Law of The People's Republic of China (the
"PRC") and Shanxi Puda Resources Co, Ltd. ("Puda"), a limited liability company
        formed by natural persons under the laws of the PRC, entered into an Exclusive
        Consulting Agreement, ("Consulting Agreement"), an Operating Agreement,
        ("Operating Agreement"), and a Technology License Agreement, ("License
        Agreement") (collectively, theses agreements are referred to herein as the
"Restructuring Agreements"). Under the Restructuring Agreements, Putai has
        agreed to advise, consult, manage and operate Puda's business, to provide
        certain financial accommodations to Puda, and to license certain technology
        to
        Puda for use in its business, in exchange for Puda's payment of all of its
        Operating Cash Flow (as defined in the Restructuring Agreements) to Putai.
Each
        of
        the holders of the registered capital of Puda also granted Putai the exclusive
        right and option to acquire all of their registered capital of Puda ("Option
        Agreement") and further authorized Putai to vote at any meeting or action of the
        owners of the registered capital of Puda and to act as the representative
        for
        such holders in all matters respecting Puda's registered capital
        ("Authorizations").
The
        Restructuring Agreements, Option Agreement and Authorizations are included
        as
        Exhibits 10.1 through 10.6 to this Report, and are hereby incorporated by
        this
        reference.
-2-
As
        a
        result of the closing of the exchange transaction described below, Puda
        Investment Holding Limited ("Puda BVI"), an International Business Company
        incorporated in the British Virgin Islands, became a wholly-owned subsidiary
        of
        Purezza. Puda BVI, in turn, owns all of the registered capital of Putai,
        a
        wholly foreign owned enterprise ("WFOE") registered under the wholly
        foreign-owned enterprises laws of the PRC.
Section
        2 - Financial Information
Item
        2.01 Completion of Acquisition or Disposition of Assets.
Effective
        June 20, 2005, Purezza Group, Inc., a Florida corporation ("Purezza"), entered
        into an Exchange Agreement ("Exchange Agreement") with Taiyuan Putai Business
        Consulting Co., Ltd. ("Putai"), a limited liability company under the Company
        Law of The People's Republic of China (the "PRC"), Shanxi Puda Resources Co,
        Ltd. ("Puda"), a limited liability company formed by natural persons under the
        laws of the PRC, Puda Investment Holding Limited ("Puda BVI"), an International
        Business Company incorporated in the British Virgin Islands, and each of
        the
        members of Puda BVI (the "Puda BVI Members"). The closing of the transactions
        contemplated by the Exchange Agreement (the "Closing") occurred on July 15,
        2005. At the Closing, pursuant to the terms of the Exchange Agreement, Purezza
        acquired all of the outstanding capital stock and ownership interests of
        Puda
        BVI (the "Interests") from the Puda BVI Members, and the Puda BVI Members
        contributed all of their Interests in Puda BVI to Purezza. In exchange, Purezza
        issued to the Puda BVI Members 1,000,000 shares of Series A Convertible
        Preferred Stock, par value $0.01 per share, of Purezza ("Preferred Shares"),
        which are convertible into 678,500,000 shares of Purezza's common stock
        ("Conversion Shares"). The issuance of the Preferred Shares and, upon
        conversion, the shares of Purezza common stock underlying the Preferred Shares,
        to the Puda BVI Members is intended to be exempt from registration under
        the
        Securities Act of 1933, as amended (the "Securities Act"), pursuant to Section
        4(2) thereof.
At
        the
        Closing, Puda BVI became a wholly-owned subsidiary of Purezza. Puda BVI,
        in
        turn, owns all of the registered capital of Putai, a wholly foreign owned
        enterprise ("WFOE") registered under the wholly foreign-owned enterprises laws
        of the PRC.
On
        July
        18, 2005, Purezza filed a press release announcing the Closing, a copy of
        which
        is attached to this Current Report on Form 8-K as Exhibit 99.1.
Except
        for the Exchange Agreement and the transactions contemplated by that agreement,
        neither Purezza, nor its directors and officers, had any material relationship
        with Puda BVI, any of the Members of Puda BVI, Puda or Putai.
Purezza
        is presently authorized under its Articles of Incorporation to issue 100,000,000
        shares of common stock, par value $0.001 per share, and 5,000,000 shares
        of
        preferred stock, par value $0.01 per share. Of the 5,000,000 shares of preferred
        stock authorized, 1,100,000 shares will be designated as Series A Convertible
        Preferred Stock pursuant to a certificate of designations ("Certificate of
        Designations"), which was approved by Purezza's board of directors, and filed
        with and accepted by, the Secretary of State of the State of Florida prior
        to
        the Closing. As of the Closing, Purezza had 59,000,000 shares of common stock
        issued and outstanding and no shares of preferred stock issued and outstanding.
-3-
Under
        the
        terms of the Exchange Agreement, all of the outstanding Interests of Puda
        BVI
        will be exchanged for 1,000,000 Preferred Shares of Purezza. Each Preferred
        Share will be convertible into 678.5 shares of Purezza's common stock (the
"Conversion Rate"). The Preferred Shares will immediately and automatically be
        converted into shares of Purezza's common stock (the "Mandatory Conversion")
        upon the approval by a majority of Purezza's stockholders (voting together on an
        as-converted-to-common-stock basis), following the exchange transaction,
        of an
        increase in the number of authorized shares of Purezza's common stock from
        100,000,000 to 150,000,000, and a 1 for 10 reverse stock split of Purezza's
        outstanding common stock ("Reverse Split"). The Conversion Rate will be adjusted
        downward to account for the Reverse Split.
The
        holders of shares of Series A Preferred Stock will be entitled to vote together
        with the holders of the common stock, as a single class, upon all matters
        submitted to holders of common stock for a vote.
Each
        share of Series A Preferred Stock will carry a number of votes equal to the
        number of shares of common stock issuable in a Mandatory Conversion based
        on the
        then applicable Conversion Rate. As such, i
mmediately
        following the Closing, the Puda BVI Members owned 92% of the total combined
        voting power of all classes of Purezza's outstanding stock entitled to
        vote.
Upon
        Mandatory Conversion of the Preferred Shares, and subject to an adjustment
        of
        the Conversion Rate as a result of the Reverse Split, the Puda BVI Members
        will,
        in the aggregate, receive approximately 67,850,000 shares of Purezza's common
        stock, representing 92% of the outstanding shares of Purezza's common stock
        immediately following the Mandatory Conversion. The existing stockholders
        of
        Purezza will, following the Mandatory Conversion and Reverse Split, own
        approximately 5,900,000 shares of Purezza's common stock, representing 8% of the
        outstanding shares of common stock.
Accordingly,
        if the Mandatory Conversion and the Reverse Split occurred as of the date
        of
        this Report, Purezza's currently issued and outstanding Series A Convertible
        Preferred Stock (currently 1,000,000 shares) and common stock (currently
        59,000,000 shares) would be converted into 67,850,000 and 5,900,000 shares
        of
        common stock, respectively, and would represent 92% and 8%, respectively,
        of
        Purezza's total common stock issued and outstanding.
In
        connection with the Reverse Split, Purezza's board of directors may, in its
        discretion, provide special treatment to certain Purezza stockholders to
        preserve round lot holders (i.e., holders owning at least 100 shares) after
        the
        Reverse Split. In the event Purezza's board determines to provide such special
        treatment, Purezza stockholders holding 1,000 or fewer shares of common stock
        but at least 100 shares of common stock will receive 100 shares of common
        stock
        after the Reverse Split, and persons holding less than 100 shares of common
        stock would not be affected. The terms and conditions of special treatment
        afforded to Purezza stockholders to preserve round lot stockholders, if any,
        including the record dates for determining which stockholders may be eligible
        for such special treatment, will be established in the discretion of Purezza's
        board of directors.
-4-
Effective
        as of the Closing, the existing director of Purezza resigned, and the following
        directors of Purezza were appointed:
Name
Age
Position
Zhao
                  Ming
34
Chairman
                  of the Board
Wang
                  Lisheng
41
Director
                  designated by Zhao Ming
Rachel
                  Li
37
Director
                  designated by Keating Reverse Merger Fund, LLC
Also
        effective as of the Closing, the existing officers of Purezza resigned, and
        the
        following officers were appointed by the newly constituted Board of
        Directors:
Name
Age
Position
Zhao
                  Ming
34
Chief
                  Executive Officer and President
Zhao
                  Yao
46
Chief
                  Operating Officer
Jin
                  Xia
40
Chief
                  Financial Officer
Effective
        as of the Closing, Kevin R. Keating resigned as sole director of Purezza
        and as
        the President, Secretary and Treasurer. Pursuant to the Exchange Agreement
        and a
        certain Voting Agreement among the Puda BVI Members and Keating Reverse Merger
        Fund, LLC ("KRM Fund") (the "Voting Agreement"), effective as of the Closing,
        KRM Fund and each Puda BVI Member have agreed to vote their shares of Purezza's
        common stock to (i) elect a person designated by the KRM Fund (the "KRM
        Designate") from time to time to Purezza's board for a period of one year
        following the Closing, (ii) elect such other persons that may be designated
        by
        Zhao Ming from time to time to fill any vacant position on the board of
        directors (other than KRM Designate), and (iii) approve the Reverse Split,
        an
        increase in Purezza's authorized common stock from 100,000,000 to 150,000,000,
        and a corporate name change.
At
        the
        Closing, Purezza entered into a financial advisory agreement with Keating
        Securities, LLC ("Keating Securities"), a registered broker-dealer, pursuant to
        which Keating Securities was compensated by Purezza for its advisory services
        rendered to Purezza in connection with the exchange transaction. The transaction
        advisory fee was $400,000, which fee was paid at Closing. The financial advisory
        agreement also appoints Keating securities as Purezza's exclusive placement
        agent and underwriter for private and public offerings of Purezza's securities
        for a one year period following Closing. The financial advisory agreement
        is
        attached as Exhibit 10.7 to this Current Report on Form 8-K, and is incorporated
        herein by reference.
Kevin
        R.
        Keating, Purezza's sole officer and director prior to the exchange transaction,
        is the father of the principal member of Keating Investments, LLC. Keating
        Investments, LLC is the managing member of KRM Fund, which was the majority
        stockholder of Purezza prior to the exchange transaction, and Keating
        Securities, LLC, the registered broker-dealer affiliate of Keating Investments,
        LLC. Kevin R. Keating is not affiliated with and has no equity interest in
        Keating Investments, LLC, KRM Fund or Keating Securities, LLC and disclaims
        any
        beneficial interest in the shares of Purezza's common stock owned by KRM Fund.
        Similarly, Keating Investments, LLC, KRM Fund and Keating Securities, LLC
        disclaim any beneficial interest in the shares of Purezza's common stock
        currently owned by Kevin R. Keating.
-5-
On
        September 27, 2004, in its Current Report on Form 8-K dated September 24,
        2004,
        Purezza reported the execution of a letter of intent to acquire Puda. On
        June
        24, 2005, in its Current Report on Form 8-K dated June 20, 2005, Purezza
        reported the execution of the Exchange Agreement and included a copy of the
        Exchange Agreement therein as Exhibit 2.1. These Current Reports are hereby
        incorporated by reference.
Section
        3 - Securities and Trading Markets
Item
        3.02 Unregistered Sales of Equity Securities.
Reference
        is made to the disclosure set forth under Item 2.01 of this Current Report
        on
        Form 8-K, which disclosure is incorporated herein by reference.
The
        issuance of the Preferred Shares and, upon conversion, the shares of Purezza
        common stock underlying the Preferred Shares, to the Puda BVI Members was
        exempt
        from registration under the Securities Act pursuant to Section 4(2) thereof
        and
        such other available exemptions. Purezza made this determination based on
        the
        representations of the Puda BVI Members which included, in pertinent part,
        that
        such members were "accredited investors" within the meaning of Rule 501 of
        Regulation D promulgated under the Securities Act, that such members were
        acquiring the Preferred Shares
,
        and the
        shares of Purezza's common stock underlying the Preferred Shares,
for
        investment purposes for their own respective accounts and not as nominees
        or
        agents, and not with a view to the resale or distribution thereof, and that
        each
        member understood that the Preferred Shares, and the shares of Purezza's common
        stock underlying the Preferred Shares, may not be sold or otherwise disposed
        of
        without registration under the Securities Act or an applicable exemption
        therefrom.
In
        the
        event of any liquidation, dissolution or winding up of Purezza, the assets
        of
        Purezza available for distribution to shareholders will be distributed among
        the
        holders of Preferred Shares and the holders of any other class of equity
        securities of Purezza, including its common stock, pro rata, on an
        as-converted-to-common-stock basis, after the payment to the holders of
        Preferred Shares of a di minimus stated value amount.
The
        holders of Preferred Shares are entitled to dividends in the event that Purezza
        pays cash or other dividends in property to holders of outstanding shares
        of its
        common stock, which dividends would be made pro rata, on an
        as-converted-to-common-stock basis.
The
        Conversion Rate applicable to the Preferred Shares is subject to adjustment
        from
        time to time in the event of any stock dividend, stock split, reverse stock
        split, reorganization or other corporate event affecting the outstanding
        capital
        stock of Purezza (including the Reverse Split).
-6-
During
        any period in which the Preferred Shares are outstanding, Purezza is not
        permitted to, without first obtaining the approval (by vote or written consent,
        as provided by law) of the holders of at least a majority of the then
        outstanding Preferred Shares, voting as a separate class:
-
create
                  (by reclassification or otherwise) any new class or series of shares
                  having rights, preferences or privileges equal or senior to the
                  Series A
                  Convertible Preferred Stock.
-
directly
                  or indirectly, alter or change the rights, preferences or privileges
                  of
                  the Series A Convertible Preferred Stock.
-
amend
                  Purezza's Articles of Incorporation in a manner that materially adversely
                  affects the rights, preferences or privileges of the holders of
                  the Series
                  A Convertible Preferred Stock.
-
increase
                  or decrease the authorized number of shares of preferred stock
                  of Purezza
                  as a whole;
-
liquidate
                  or wind-up Purezza; or
-
redeem,
                  purchase or otherwise acquire (or pay into or set funds aside for
                  a
                  sinking fund for such purpose) any share or shares of preferred
                  stock or
                  common stock; provided, however, that this restriction will not
                  apply to
                  the repurchase of shares of common stock from employees, officers,
                  directors, consultants or other persons performing services for
                  Purezza or
                  any subsidiary pursuant to agreements under which Purezza has the
                  option
                  to repurchase such shares at cost upon the occurrence of certain
                  events,
                  such as the termination of employment, or through the exercise
                  of any
                  right of first refusal.
Upon
        the
        occurrence of the Mandatory Conversion, or any other redemption or
        extinguishment of the Series A Convertible Preferred Stock, the shares
        converted, redeemed or extinguished will be automatically returned to the
        status
        of authorized and unissued shares of preferred stock, available for future
        designation and issuance pursuant to the terms of Purezza's Articles of
        Incorporation.
Purezza's
        Certificate of Designations, Preferences, Rights and Limitations of Series
        A
        Convertible Preferred Stock, as filed with the Secretary of State of the
        State
        of Florida, is attached as Exhibit 4.1 to this Current Report on Form 8-K,
        and
        is incorporated herein by reference.
Item
        3.03 Material Modification to Rights of Security Holders
Reference
        is made to the disclosure set forth under Items 2.01 and 3.02 of this Current
        Report on Form 8-K, which disclosure is incorporated herein by
        reference.
As
        a
        result of the Closing and the issuance of the Preferred Shares
,
        the
        Puda BVI Members own 92% of the total combined voting power of all classes
        of
        Purezza stock entitled to vote.
Upon
        Mandatory Conversion of the Preferred Shares, and subject to an adjustment
        of
        the Conversion Rate as a result of the Reverse Split, the Puda BVI Members
        will,
        in the aggregate, receive approximately 67,850,000 shares of Purezza's common
        stock, representing 92% of the outstanding shares of Purezza's common stock
        immediately following the Mandatory Conversion. The existing stockholders
        of
        Purezza will, following the Mandatory Conversion and Reverse Split, own
        approximately 5,900,000 shares of Purezza's common stock, representing 8% of the
        outstanding shares of common stock.
-7-
Accordingly,
        if the Mandatory Conversion and the Reverse Split occurred as of the date
        of
        this Report, Purezza's currently issued and outstanding Series A Convertible
        Preferred Stock (currently 1,000,000 shares) and common stock (currently
        59,000,000 shares) would be converted into 67,850,000 and 5,900,000 shares
        of
        common stock, respectively, and would represent 92% and 8%, respectively,
        of
        Purezza's total common stock issued and outstanding.
Section
        5 - Corporate Governance and Management
Item
        5.01 Changes in Control of Registrant.
Reference
        is made to the disclosure set forth under Item 2.01 of this Current Report
        on
        Form 8-K, which disclosure is incorporated herein by reference.
Item
        5.02 Departure of Directors or Principal Officers; Election of Directors;
        Appointment of Principal Officers.
Reference
        is made to the disclosure set forth under Item 2.01 of this Current Report
        on
        Form 8-K, which disclosure is incorporated herein by reference.
Effective
        as of the Closing, Kevin R. Keating resigned as the prior sole director and
        officer of Purezza, and the following officers were appointed by the newly
        constituted Board of Directors:
Name
Age
Position
Zhao
                  Ming
34
Chief
                  Executive Officer and President
Zhao
                  Yao
46
Chief
                  Operating Officer
Jin
                  Xia
40
Chief
                  Financial Officer
Zhao
        Ming
has been
        the CEO and Chairman of Puda since 1995. He was one of the co-founders of
        Puda.
        He also serves as an executive officer of Shanxi Liulin Jucai Coal Industry
        Co.,
        Limited, a coal mine which supplies raw coal to Puda. He had been the Vice
        President of Administration at the Fire Department of Taiyuan city from 1994
        to
        1997. Mr. Zhao graduated from Nanjing Armed Police Forces Command College
        of
        China in 1994 with a bachelor degree in management.
Zhao
        Yao
was one
        the co-founders of Puda. He was named Chief Operating Officer of Puda in
        1999,
        and he was appointed Vice President in June 1995. He also serves as an executive
        officer and is a 75
%
        owner
        of Shanxi Liulin Jucai Coal Industry Co., Limited, a coal mine which supplies
        raw coal to Puda. He graduated from University of Shanxi in Taiyuan City,
        Shanxi
        Province in 1982 with a bachelor degree in coal study, and graduated from
        China's Tsinghua University in Beijing in 1985 with a master degree in coal
        study. He published a coal resources research report in a national coal industry
        newspaper on July 9, 1985, and received close attention from industry experts.
        He is an contributor to the Chinese Hope Project for child education, and
        was
        awarded Shanxi's Distinguished Entrepreneur award by Shanxi provincial
        government in 2002.
-8-
Jin
        Xia
joined
        Puda in 2003 as Chief Financial Officer. She also held financial manager
        positions in various entities during 2000 to 2003. She was the Financial
        Accountant at a local government agency in Xinhualing of Taiyuan City, Shanxi
        Province from 1991 to 1999. She served as an accountant at Xinhua Machinery
        Factory from 1987 to 1991. Ms. Jin graduated from Shanxi Finance and Economics
        College in China with an associate degree.
Zhao
        Ming
        and Zhao Yao are brothers.
None
        of
        the newly appointed executive officers have entered into an employment agreement
        with Purezza, Puda BVI, Putai or Puda.
At
        the
        Closing, the following directors of Purezza were appointed:
Name
Age
Position
Zhao
                  Ming
34
Chairman
                  of the Board
Wang
                  Lisheng
41
Director
                  designated by Zhao Ming
Rachel
                  Li
37
Director
                  designated by KRM Fund
Please
        see the biographies of Zhao Ming set forth above.
Wang
        Lisheng
became
        an independent director of Shanxi Puda Resources Co., Ltd. in October 2004.
        He
        has been a bank manager with the People's Bank of China Taiyuan Branch since
        1986.  The People's Bank of China is the central bank in China. He
        graduated from Shanxi University in 1986 with a bachelor's degree in management
        and economics.
Rachel
        Li
has been
        an investment portfolio manager since 2004 with Morningside Group, a private
        equity firm founded in Hong Kong that has investments in North America, Europe,
        and Asia Pacific.  Ms. Li was a senior associate in healthcare investment
        banking with RBC Capital Markets (Royal Bank of Canada) in Menlo Park
        and
        San Francisco, California from 2001 to 2004.  She was an auditor initially
        and later a senior auditor with PricewaterhouseCoopers, LLP in San Jose,
        California from 1999 to 2001. From 1997 to 1998, she was a scientist and
        senior
        scientist with a biotech company - QIAGEN Inc. in Los Angeles.  Ms.
        Li was
        a research scientist with Chinese Academy of Medical Sciences from 1989 to
        1991.  Ms. Li graduated from Cornell University with an MBA degree
        in
        1999.  Previously she earned her Ph.D. degree in Biochemistry and
        Molecular
        Biology in 1996 from University of South Florida.  She graduated from
        Beijing University in 1989 with a bachelors' degree in Plant Physiology and
        Biochemistry.
Under
        the
        Voting Agreement, effective as of the Closing, KRM Fund and each Puda BVI
        Member
        have agreed to vote their shares of Purezza's common stock to (i) elect the KRM
        Designate from time to time to Purezza's board for a period of one year
        following the Closing, (ii) elect such other persons that may be designated
        by
        Zhao Ming from time to time to fill any vacant position on the board of
        directors (other than the KRM Designate), and (iii) approve the Reverse Split,
        an increase in Purezza's authorized common stock from 100,000,000 to
        150,000,000, and a corporate name change.
-9-
None
        of
        the newly appointed officers and directors, nor any of their affiliates,
        currently beneficially own any equity securities or rights to acquire any
        securities of Purezza except as otherwise described in this Report, and no
        such
        persons have been involved in any transaction with Purezza or any of its
        directors, executive officers or affiliates that is required to be disclosed
        pursuant to the rules and regulations of the Securities and Exchange Commission
        (the "SEC"), other than with respect to the transactions that have been
        described in this Report or in any prior reports filed by Purezza with the
        SEC.
        None of the newly appointed officers and directors have been convicted in
        a
        criminal proceeding, excluding traffic violations or similar misdemeanors,
        nor
        have they been a party to any judicial or administrative proceeding during
        the
        past five years, except for matters that were dismissed without sanction
        or
        settlement, that resulted in a judgment, decree or final order enjoining
        the
        person from future violations of, or prohibiting activities subject to, federal
        or state securities laws, or a finding of any violation of federal or state
        securities laws.
Until
        further determination by the Board, the full Board of Directors will undertake
        the duties of the Audit Committee, Compensation Committee and Nominating
        Committee of the Board of Directors.
Item
        5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
        Year.
Effective
        as of the Closing, pursuant to the provisions of the bylaws of Purezza,
        applicable to all holders of capital stock, the Board of Directors of Purezza,
        by resolution increased the number of directors on the Board of Directors
        of
        Purezza from one to three.
Purezza's
          Certificate of Designations, Preferences, Rights and Limitations of Series
          A
          Convertible Preferred Stock, as filed with the Secretary of State of Florida,
          is
          attached as Exhibit 4.1 to this Current Report on Form 8-K, and is incorporated
          herein by reference.
Section
        8
Item
        8.01 Other Events.
Reference
        is made to the disclosure set forth under Items 1.01, 2.01, 3.02, 3.03, 5.01,
        5.02 and 5.03 of this Current Report on Form 8-K, which disclosure is
        incorporated herein by reference.
Business
        of Purezza
Prior
        to
        the Closing, Purezza was a public "shell" company with nominal assets whose sole
        business was to identify, evaluate and investigate various companies to acquire
        or with which to merge.
Business
        of Puda
Overview
Pursuant
        to the Exchange Agreement, Purezza acquired 100% of the capital stock of
        Puda
        BVI, an international business company incorporated in the Territory of the
        British Virgin Islands on August 19, 2004. Puda BVI was organized by Zhao
        Ming
        and Zhao Yao, the executive officers and principal owners of Puda. Zhao Ming
        and
        Zhao Yao own approximately 80% and 20%, respectively, of the capital stock
        of
        Puda BVI.
-10-
Putai
        is
        organized as a limited liability company in the PRC. Putai was organized
        to be a
        wholly foreign owned enterprise ("WFOE") and received its WFOE approval from the
        PRC government on October 18, 2004. Puda BVI is the sole owner
        of  Putai.
On
        June
        24, 2005, Putai and Puda entered into an Exclusive Consulting Agreement,
        ("Consulting Agreement"), an Operating Agreement, ("Operating Agreement"), and a
        Technology License Agreement, ("License Agreement") (collectively, theses
        agreements are referred to herein as the "Restructuring Agreements"). Under the
        Restructuring Agreements, Putai has agreed to advise, consult, manage and
        operate Puda's business, to provide certain financial accommodations to Puda,
        and to license certain technology to Puda for use in its business, in exchange
        for Puda's payment of all of its Operating Cash Flow (as defined in the
        Restructuring Agreements) to Putai.
Each
        of
        the holders of the registered capital of Puda also granted Putai the exclusive
        right and option to acquire all of their registered capital of Puda ("Option
        Agreement") and further authorized Putai to vote the registered capital of Puda
        and to act as the representative for such holders in all matters respecting
        Puda's registered capital ("Authorizations").
The
        Restructuring Agreements, Option Agreement and Authorizations are included
        as
        Exhibits 10.1 through 10.6 to this Report, and are hereby incorporated by
        this
        reference.
Puda's
        Coal Washing Business
Puda
        is a
        limited liability company under the laws of the PRC and a domestic enterprise
        with exclusively domestic capital registered in Shanxi Province in the PRC.
        The
        registered capital of Puda is owned 80% by Zhao Ming and 20% by Zhao Yao.
        Puda
        received its business operating license on June 7, 1995 from the PRC government
        authorities. Puda is engaged in the business of coal crushing, preparation
        and
        cleaning in the PRC. The principal executive office of Puda is located at
        426
        Xuefu Street, Taiyuan, Shanxi Province, PRC. Zhao Ming and Zhao Yao are the
        executive officers of Puda.
Puda
        focuses on value added coal washing processes
and
        specializes in providing cleaned coal for primarily metallurgical purposes,
        such
        as steel making.
In the
        coal washing process, raw coal is cleaned by using Puda's water-supported
        technology. The
cleaned
        coal produced by Puda is well suited for processing into coking coal, which
        is
        an essential raw material for steel production.
Currently,
        Puda is one of the largest washed coal suppliers in Shanxi Province. Shanxi
        Province has the biggest coal reserves in China, and commands more than 20%
        of
        coal production in China.
Puda's
        Coal Washing Facilities
Puda
        has
        two coal washing facilities in Liulin County in Shanxi Province in the PRC.
        Liulin
County
        is
        renowned for the good quality of its coal.
The
        two
        coal washing facilities are the:
-11-
1.
Shanxi
        Liulin Jucai Plant
which
        has
        an annual clean coal washing capacity of 100,000 tons. This facility is located
        about two miles from the premises of coal mine owned and operated by Shanxi
        Liulin Jucai Coal Industry Co., Limited ("Jucai Coal"). Zhao Yao is a
        75
%
        owner
        of Jucai Coal. Jucai Coal leases the coal processing facility to Puda. The
        leasing agreement was entered into on December 2, 2001 for a term of 5 years.
        The cost for the leased capacity is approximately $604,000 annually with
        four
        quarterly payments per year.
2.
Shanxi
        Liulin Dongqiang Plant
which
        has
        an annual clean coal washing capacity of 400,000 tons. This facility is owned
        by
        Puda
and
has
        a
        land area of approximately 1.5 hectares, and is located about 120 miles
        southwest of Taiyuan City, the capital of Shanxi Province.
.
Puda's
        Technology
Puda
        specializes in coal washing, processing and preparation utilizing a water
        supported jig washing technology. Puda facilities use these proprietary coal
        washing processes and technologies, to be licensed from Putai, and has its
        own
        wells as a water source for its coal washing
process.
        Together with the recycling of water from the coal washing system, the two
        plants have a sufficient and reliable supply of water for their
        operations.
Coal
        Washing Industry in China; Competition
In
        China,
        many coal mines do not have their own coal preparation facilities or have
        inadequate preparation capacities. Coal cleaning companies such as Puda were
        established to meet the demand for cleaned coal. The Chinese coal preparation
        industry is currently highly fragmented. Many coal washing plants have annual
        processing capacity of 100,000 tons or less.
Puda
        is
        the third largest coal washing company in Shanxi Province in terms of annual
        cleaned coal production. Taiyuan Coal Beneficiation Plant (a subsidiary of
        Xishan Coal & Electricity Group, which is one of Puda's current customers)
        is the largest coal washing company in Shanxi Province with coal washing
        capacity of 1.8 million tons per year. Another major local coal washing company
        in Shanxi Province is Shanxi Coking Company, which produces 1.6 million tons
        of
        cleaned coal per year. Puda's major competitive advantage is its ability to
        access some of the highest quality raw coal in China and its well-established
        business relationship with local suppliers. However, with larger scale and
        sales, these competitors usually have better access to capital needed for
        further development.
There
        are
        also many coal preparation plants located in the northeast China. However,
        due
        to lower quality of the raw coal in this region, these plants are less
        competitive in the cleaned coal market, especially in the coking coal market
        which serves the steel production industry.
High-grade
        cleaned coal production depends on high-grade raw coal inputs. Puda's coal
        washing facilities are located in Liulin County of Shanxi Province, where
        top
        grades of coking coal reserves exist. The coal sourced from this area has
        been
        known as the "King of Coal" in China.
-12-
Puda's
        Suppliers of Raw Coal
Puda
        is
        not a coal mining operation and does not own any coal mines. Puda currently
        secures raw coal from a diversified pool of local Liulin County coal mines,
        including Liulin Jucai Coal Industry Co. Ltd. ("Jucai Coal"), a coal mine that
        is owned 75
%
        by Zhao
        Yao. Jucai Coal supplies raw coal to both Puda and other unrelated parties.
        The
        Jucai Coal mining operations produced 450,000 and 400,000 tons of raw coal
        in
        2003 and 2004, respectively. Out of this annual raw coal production, Jucai
        Coal
        sold approximately 20% and 10% of its raw coal production in 2003 and 2004,
        respectively, to Puda at prevailing market prices. The raw coal purchased
        from
        Jucai Coal accounted for approximately 19% and 12% of Puda's total raw coal
        purchases in tonnage in 2003 and 2004, respectively. None of Puda's raw coal
        suppliers provided more than 15% of its total raw coal purchases in tonnage
        in
        2004.
Cost
        of
        transportation of raw coal from the mines to the cleaning facilities is an
        important factor in the industry. By staying close to these top grade coal
        reserves and coal mines, Puda has established its competitive advantage over
        its
        competitors in China, since easier and cheaper access to high quality raw
        coal
        is generally secured.
Puda's
        Customers
Most
        of
        Puda's current customers are PRC coke producers (who then sell their coke to
        major steel makers), steel mills that have their own coking facilities, and
        gas
        companies. During 2003, Puda sold approximately 363,000 tons of washed coal
        to
        12 different customers, with no customers accounting for more than 16% of
        total
        tonnage sales. During 2004, Puda sold approximately 315,000 tons of washed
        coal
        to 11 different customers, with no customer accounting for more than 16%
        of
        total tonnage sales.
Coal
        washed by Shanxi is used by some of the top steel businesses in China including
        Taiyuan Iron & Steel (Group) Co., Ltd., which is an iron and steel complex
        producing steel plate and stainless steel; and Baotou Iron and Steel
        (Group) Company, Limited, which is a production base of iron and
        steel.
Customers
        normally settle the accounts receivable within three months after they pick
        up
        the cleaned coal. Puda acquires new customers through direct contacts,
        referrals, and participating in national industry trade shows and coal
        supply-demand coordination conferences.
Puda's
        Employees
Puda
        currently has approximately 139 employees. The following table shows the
        breakdown of the number of employees by functional departments.
Department
Job
                  Title / Responsibility
#
                  of Employees
Corporate
President,
                  Vice Presidents, Managers
10
Finance
Finance
                  and Accounting
7
Purchasing
Purchase
                  raw coal and maintain relationship with suppliers
16
Marketing
                  and Sales
Sell
                  cleaned coal, maintain relationship with customers, and acquire
                  new
                  customers
22
Transportation
Short-range
                  truck drivers (within plant)
11
Production
Produce
                  cleaned coal
64
Quality
                  Control
Quality
                  check on input (raw coal) and output (cleaned coal)
9
Total
139
-13-
Principal
        Executive Offices
The
        principal executive office of Puda is located at 426 Xuefu Street, Taiyuan,
        Shanxi Province, PRC. Puda's telephone number, and the telephone number of
        Purezza following the Closing, is
86
        351
        2281300
Management's
        Discussion and Analysis or Plan of Operation of Puda
Disclosure
        Regarding Forward-Looking Statements
This
        Form
        8-K includes "forward-looking" statements within the meaning of Section 27A
        of
        the Securities Act, and Puda desires to take advantage of the "safe harbor"
        provisions thereof. Therefore, Puda is including this statement for the express
        purpose of availing itself of the protections of such safe harbor provisions
        with respect to all of such forward-looking statements. The forward-looking
        statements in this Form 8-K reflect Puda's current views with respect to
        future
        events and financial performance. These forward-looking statements are subject
        to certain risks and uncertainties that could cause actual results to differ
        from those anticipated. In its Form 8-K current report, the words "anticipates,"
        "believes, "expects," "intends," "future" and similar expressions identify
        forward-looking statements. Puda undertakes no obligation to publicly revise
        these forward-looking statements to reflect events or circumstances that
        may
        arise after the date hereof. All subsequent written and oral forward- looking
        statements attributable to Puda or persons acting on its behalf are expressly
        qualified in their entirety by this section.
Significant
        Accounting Estimates and Policies
The
        discussion and analysis of Puda's financial condition and results of operations
        is based upon Puda's financial statements which have been prepared in accordance
        with accounting principles generally accepted in the United States. The
        preparation of these financial statements requires Puda to make estimates
        and
        judgments that affect the reported amounts of assets and liabilities. On
        an
        on-going basis, Puda evaluates its estimates including the allowance for
        doubtful accounts, the salability and recoverability of inventory, income
        taxes
        and contingencies. Puda bases its estimates on historical experience and
        on
        various other assumptions that Puda believes to be reasonable under the
        circumstances, the results of which form Puda's basis for making judgments about
        the carrying values of assets and liabilities that are not readily apparent
        from
        other sources. Actual results may differ from these estimates under different
        assumptions or conditions.
Puda
        must
        make estimates of the collectability of accounts receivable. Puda analyzes
        historical write-offs, changes in its internal credit policies and customer
        concentrations when evaluating the adequacy of its allowance for doubtful
        accounts. Differences may result in the amount and timing of expenses for
        any
        period if Puda makes different judgments or uses difference
        estimates.
-14-
Property
        and equipment are evaluated for impairment whenever indicators of impairment
        exist. Accounting standards require that if an impairment indicators are
        present, Puda must assess whether the carrying amount of the asset is
        unrecoverable by estimating the sum of the future cash flows expected to
        result
        from the asset, undiscounted and without interest charges. If the carrying
        amount is less than the recoverable amount, an impairment charge must be
        recognized, based on the fair value of the asset.
Goodwill
        is reviewed at least annually for impairment, or more frequently if indicators
        of impairment exist, goodwill is tested by comparing net book value of the
        reporting entity to fair value. Puda's management's assumptions about fair
        values require significant judgment because broad economic factors, industry
        factors and technology considerations can result in variable and volatile
        fair
        values.
Puda
        cannot predict what future laws and regulations might be passed that could
        have
        a material effect on our results of operations. We assess the impact of
        significant changes in laws and regulations on a regular basis and update
        the
        assumptions and estimates used to prepare our financial statements when we
        deem
        it necessary.
Revenue
        from sales of processed coal is generally recognized during the period when
        the
        coal is delivered and title passes to the purchaser.
Puda's
        functional currency is Renminbi ("RMB") and its reporting currency is U.S.
        dollars. Puda's balance sheet accounts are translated into U.S. dollars at the
        year-end exchange rates prevailing during the periods in which these items
        arise. Translation gains and losses are deferred and accumulated as a component
        of other comprehensive income in owners' equity. Transaction gains and losses
        that arise from exchange rate fluctuations from transactions denominated
        in a
        currency other than the functional currency are included in the statement
        of
        operations as incurred. The translation and transaction gains and losses
        were
        immaterial in the statement of operations as incurred. The translation and
        transaction gains and losses were immaterial for the years ended December
        31,
        2003 and 2004. The PRC presently has a fixed exchange rate of 8.28 RMB per
        US$1.00.
The
        PRC
        government imposes significant exchange restrictions on fund transfers out
        of
        the PRC that are not related to business operations. These restrictions have
        not
        had a material impact on Puda because it has not previously engaged in any
        significant transactions that are subject to the restrictions.
-15-
Results
        of Operations
Year
        Ended December 31, 2004 Compared to Year Ended December 31,
        2003
Net
        Revenue.
Net
        revenue for the year ended December 31, 2004 increased $6.3 million,
        or 47.0%, from $13.4 million in 2003 to $19.7 million in 2004. The
        tonnage
        sales of cleaned coal decreased 48,000 tons from 363,000 tons in 2003 to
        315,000
        tons during 2004, a 13.2% decrease. The decrease in tonnage sales was primarily
        due to tightened raw coal supply in the PRC in 2004, during which period
        most of
        the raw coal suppliers in the PRC were required by the PRC government to
        temporarily cease their operation for safety checks and improvements. The
        decrease in tonnage sales were offset by significant increase in the per
        ton
        sales price of cleaned coal in all regions.
Cost
        of Revenues.
Puda's
        cost of revenue for the year ended December 31, 2004 increased
        $4.0 million, or 43.5%, from $9.2 million in 2003 to $13.2 million
        in 2004.
        This was primarily due to the increase in the price per ton of raw coal,
        which
        was partially offset by the reduced 2004 sales volumes.
Operating
        Expenses.
Operating expenses were $939,000 for the year ended December 31, 2004,
        compared to $541,000 for the year ended December 31, 2003. This represents
        an
        increase of $398,000 from 2003 to 2004, or 73.6%, primarily due to $414,000
        of
        costs in 2004 related to Puda's efforts to obtain public listing in the
        U.S.
Income
        from Operations.
Operating profit increased $1.9 million, or 52.8%, from $3.6 million in 2003
        to
        $5.6 million in 2004. The increase was primarily the result of increased
        gross
        profit margin in 2004 (31.3% in 2003 versus 33.0% in 2004) and increased
        net
        revenues in 2004.
Income
        Taxes.
Income
        taxes increased $632,000, or 51.4%, from $1.23 million in 2003 to $1.87 million
        in 2004.
Net
        Income.
Net
        income was $3.7 million for the year ended December 31, 2004, compared to
        $2.4
        million in the year ended December 31, 2003, an increase of $1.3 million,
        or
        54.2%.
Liquidity
        and Capital Resources
Net
        cash
        provided by operating activities was $2.7 million for the year ended
        December 31, 2004, compared to $226,000 in 2003, an increase of $2.47
        million from the prior year. The improvement was primarily due to improved
        working capital cash flows in 2004 compared to 2003.
Net
        cash
        used by financing activities was $3.2 million for the year ended
        December 31, 2004, compared with cash provided by financing activities
        of
        $0 in 2003.  This was related to a cash distribution paid to owners
        of $3.2
        million in 2004. Puda has no long-term debt as of December 31, 2004.
-16-
Puda
        currently leases the
Shanxi
        Liulin Jiucai Plant
which
        has
        an annual clean coal washing capacity of 100,000 tons. This facility is located
        about two miles from the premises of coal mine owned and operated by Shanxi
        Liulin Jucai Coal Industry Co., Limited ("Jucai Coal"). Zhao Yao is a
        75
%
        owner
        of Jucai Coal. Jucai Coal leases the coal processing facility to Puda. The
        leasing agreement was entered into on December 2, 2001 for a term of 5 years.
        The cost for the leased capacity is approximately $604,000 annually with
        four
        quarterly payments per year.
Risk
        Factors
YOU
        SHOULD CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS AND ALL OTHER INFORMATION
        CONTAINED IN THIS REPORT BEFORE PURCHASING SHARES OF PUREZZA'S COMMON STOCK.
        INVESTING IN PUREZZA'S COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. IF ANY OF
        THE FOLLOWING EVENTS OR OUTCOMES ACTUALLY OCCURS, PUDA'S BUSINESS, OPERATING
        RESULTS AND FINANCIAL CONDITION WOULD LIKELY SUFFER. AS A RESULT, THE TRADING
        PRICE OF PUREZZA'S COMMON STOCK COULD DECLINE, AND YOU MAY LOSE ALL OR PART OF
        THE MONEY YOU PAID TO PURCHASE PUREZZA'S COMMON STOCK.
Risks
        Related to Puda's Business
Coal
        Supply Agreements
.
        If a
        substantial portion of Puda's long-term coal supply agreements terminate, Puda's
        revenues and operating profits could suffer if Puda were unable to find
        alternate buyers willing to purchase Puda's processed coal on comparable terms
        to those in Puda's contracts. A substantial portion of Puda's sales are made
        under coal supply agreements, which are important to the stability and
        profitability of its operations. The execution of satisfactory coal supply
        agreements is frequently the basis on which Puda undertakes its expansion
        and
        marketing plans. Coal supply agreements are generally renewed annually, and
        it
        is common business practice in PRC that coal purchase and supply agreement
        are
        signed for one year terms, with annual renewals. This practice makes it
        difficult for Puda to forecast long-term purchase and supply quantities.
Coal
        Price Adjustments
.
        Puda's
        coal supply agreements with customers generally contain provisions that permit
        the parties to adjust the contract price upward or downward at specified
        times.
        Puda may adjust these contract prices for cleaned based on increases or
        decreases in the price of raw coal from its mining suppliers, general inflation
        or deflation, and changes in the factors affecting the cost of producing
        raw or
        cleaned coal, such as taxes, fees, royalties and changes in the laws regulating
        the mining, production, sale or use of coal. Failure of the parties to agree
        on
        a price under these provisions may allow either party to terminate the contract.
        Puda may experience a reduction in coal prices in new supply agreements which
        replace expiring supply contracts at higher prices. Coal supply agreements
        also
        typically contain force majeure provisions allowing temporary suspension
        of
        performance by Puda or the customer during the duration of specified events
        beyond the control of the affected party. Puda's operating profits from cleaned
        coal sold under supply agreements depend on a variety of factors. Puda is
        subject to short-term coal price volatility and may be forced to purchase
        raw
        coal at higher prices. If Puda cannot adjust its prices to its customers
        in such
        cases or find alternative customers at a higher price, Puda's profitability may
        be adversely impacted. Market prices for raw coal have generally increased
        in
        most regions in the PRC in 2004, and market prices for raw coal appear to
        be
        continuing to increase in most regions in the PRC in 2005. Puda cannot predict
        the future strength of the coal market and cannot provide any assurances
        that
        Puda will be able to replace or modify existing coal supply agreements with
        its
        customers at prices which reflect the continuing increase in raw coal prices.
-17-
Cleaned
        Coal Quality Specifications
.
        Most
        coal supply agreements contain provisions requiring Puda to deliver coal
        meeting
        quality thresholds for certain characteristics such as BTUs, sulfur content,
        ash
        content, grindability and ash fusion temperature. Failure to meet these
        specifications could result in economic penalties, including price adjustments,
        the rejection of deliveries or termination of the contracts. Moreover, some
        of
        these agreements permit the customer to terminate the contract if transportation
        costs, which Puda's customers typically bear, increase substantially. In
        addition, some of these contracts allow our customers to terminate their
        contracts in the event of changes in regulations affecting our industry that
        increase the price of coal beyond specified limits.
Potential
        for Customer Loss
.
        The
        loss of, or significant reduction in, purchases by Puda's largest customers
        could adversely affect its revenues. For the year ended December 31,
        2004,
        Puda derived 57% of its total cleaned coal revenues from sales to its five
        largest customers. Puda's coal supply contracts with its customers are generally
        for one-year terms, which may be renewed by the parties at the end of the
        term
        for an additional one year. Puda is currently discussing the extension of
        existing agreements or entering into new supply agreements with some of these
        customers, but these negotiations may not be successful and those customers
        may
        not continue to purchase cleaned coal from Puda under supply agreements.
        If a
        number of these customers were to significantly reduce their purchases of
        cleaned coal from Puda, or if Puda were unable to sell cleaned coal to them
        on
        terms as favorable to Puda as the terms under its current agreements, Puda's
        financial condition and results of operations could suffer materially.
Impact
        of Transportation Costs
.
        If
        transportation for Puda's cleaned coal becomes unavailable or uneconomic for its
        customers, Puda's ability to sell cleaned coal could suffer. Transportation
        costs represent a significant portion of the total cost of cleaned coal and,
        as
        a result, the cost of transportation is a critical factor in a customer's
        purchasing decision. Increases in transportation costs could make cleaned
        coal a
        less competitive source of energy or could make some of Puda's operations less
        competitive than other sources of cleaned coal. Certain coal supply agreements
        permit the customer to terminate the contract if the cost of transportation
        increases by an amount ranging from 10% to 20% in any given 12-month period.
        Coal producers and processors depend upon rail, barge, trucking, overland
        conveyor and other systems to deliver coal to markets. While coal customers
        typically arrange and pay for transportation of cleaned coal from our facilities
        to the point of use, disruption of these transportation services because
        of
        weather-related problems, strikes, lock-outs or other events could temporarily
        impair Puda's ability to supply coal to its customers and thus could adversely
        affect Puda's results of operations. For example, the high volume of raw coal
        shipped from all Shanxi Province mines could create temporary congestion
        on the
        rail systems servicing that region.
Coal
        Processing Costs
.
        Puda's
        coal processing and cleaning operations are subject to conditions beyond
        its
        control that can delay coal deliveries or increase the cost of processing
        coal
        for varying lengths of time. These conditions include weather and natural
        disasters, unexpected maintenance problems, key equipment failures, variations
        in rock and other natural materials. The government regulates Puda's
-18-
coal
        processing operations, which imposes significant costs on it, and future
        regulations could increase those costs or limit Puda's ability to crush, clean
        and process coal. The PRC and local authorities regulate the coal mining
        industry with respect to matters such as employee health and safety, permitting
        and licensing requirements, air quality standards, water pollution, plant
        and
        wildlife protection, reclamation and restoration of mining properties after
        mining is completed, the discharge of materials into the environment, surface
        subsidence from underground mining and the effects that mining has on
        groundwater quality and availability. Puda is required to prepare and present
        PRC and local authorities data pertaining to the effect or impact that any
        proposed processing of coal may have upon the environment. The costs,
        liabilities and requirements associated with these regulations may be costly
        and
        time-consuming and may delay commencement, expansion or continuation of Puda's
        coal processing operations. The possibility exists that new legislation and/or
        regulations and orders may be adopted that may materially and adversely affect
        Puda's operations, its cost structure and/or its customers' ability to use coal.
        New legislation or administrative regulations (or judicial interpretations
        of
        existing laws and regulations), including proposals related to the protection
        of
        the environment that would further regulate and tax the coal industry, may
        also
        require Puda or its customers to change operations significantly or incur
        increased costs. Certain supply agreements may contain provisions that allow
        a
        purchaser to terminate its contract if legislation is passed that either
        restricts the use or type of coal permissible at the purchaser's plant or
        results in specified increases in the cost of coal or its use. These factors
        and
        legislation, if enacted, could have a material adverse effect on Puda's
        financial condition and results of operations.
Raw
        Coal Supply Sources
.
        Currently, seven of Puda's total of eight raw coal suppliers provide 10% or more
        of Puda's total raw coal purchases in tonnage in 2004, although no supplier
        provided more than 15% of Puda's total purchases in tonnage. One of Puda's local
        suppliers was Liulin Jucai Coal Industry Co. Ltd. ("Jucai Coal "), a related
        coal mine owned 75
%
        by Zhao
        Yao. Jucai Coal supplied raw coal to both Puda and other unrelated parties.
        Out
        of this annual raw coal production, Jucai Coal sold approximately 20% and
        10% of
        its raw coal production in 2003 and 2004, respectively, to Puda at prevailing
        market prices. The raw coal purchased from Jucai Coal accounted for
        approximately 19% and 12% of Puda's total raw coal purchases in tonnage in 2003
        and 2004, respectively. Although Puda has relatively long-term relationship
        with
        these suppliers, there is no assurance that these suppliers will continue
        to
        provide raw coal to Puda on a timely basis. If these local suppliers face
        production shortages or the business relationships between Puda and these
        suppliers deteriorates, Puda may have difficulty in sourcing raw coal with
        comparable quality from other suppliers in a timely manner at comparable
        prices.
Limited
        Washing Capacity; Delays in Delivery of Cleaned Coal
.
        If
        Puda's sales increase, there is no assurance that Puda will be able to deliver
        increased product volumes on a timely and efficient basis. Puda has limited
        coal
washing
and cleaning capacity. Currently, Puda's coal washing and cleaning
        facilities can process up to 500,000 tons of clean coal per year.
In
        2003
        and 2004, Puda's sales of clean coal were 363,000 tons and 315,000 tons,
        respectively, representing approximately 73% and 63% of overall washing capacity
        in 2003 and 2004, respectively.
Puda's current lease on the
Shanxi
        Liulin Jucai Plant, which is located about two miles from the
Jucai
        Coal mining operations and has an annual clean coal washing capacity of 100,000
        tons, expires in 2006.
It is
        possible that this lease may not be renewed and, in such case, Puda may not
        be
        able to find suitable replacement capacity at reasonable costs. Further,
        there
        can be no assurance that Puda will be able to timely deliver its products
        to its
        customers on a consistent basis due to rail and truck transportation
        interruptions, especially with increased product volumes, and a failure to
        do so
        could have a material and adverse effect on its business, operations and
        finances.
-19-
Geographic
        Concentration; Fluctuations in Regional Economic Conditions
.
        Nearly
        all of Puda's sales are concentrated in the central and northern area of China.
        Accordingly, Puda is susceptible to fluctuations in its business caused by
        adverse economic conditions in their region. Difficult economic conditions
        in
        other geographic areas into which Puda may expand may also adversely affect
        its
        business, operations and finances.
Coal
        Industry Capacity in PRC
.
        If the
        coal industry experiences overcapacity in the future, Puda's profitability could
        be impaired.   During the mid-1970s and early 1980s, a growing coal
        market
        and increased demand for coal in the PRC attracted new investors to the coal
        industry, spurred the development of new mines and resulted in added production
        capacity throughout the industry, all of which led to increased competition
        and
        lower coal prices. Similarly, an increase in future coal prices could encourage
        the development of expanded capacity by new or existing coal producers and
        coal
        processors. Any overcapacity could reduce coal prices in the future.
Dependence
        on Executives
.
        Puda is
        highly dependent on the services of Zhao Ming and Zhao Yao, who are brothers,
        and the loss of their services would have a material and adverse impact on
        the
        operations of Puda. They have been primarily responsible for the development
        of
        Puda and the development and marketing of its products. Puda has not applied
        for
        key-man life insurance on the lives of these executives, but may do so in
        the
        future.
Proprietary
        Knowledge and Absence of Patent Protection
.
        Puda
        has no patents covering its production processes and expects to rely principally
        on know-how and the confidentiality of its production processes for its coal
        in
        producing a competitive product line of coal products. There is no assurance
        that any of these factors can be maintained or that they will afford Puda
        a
        meaningful competitive advantage.
Competition
.
        The
        coal crushing, washing and processing business is highly competitive in the
        PRC
        and, therefore, Puda faces substantial competition in connection with the
        marketing and sale of its products. Most of Puda's competitors are well
        established, have greater financial, marketing, personnel and other resources,
        have been in business for longer periods of time than Puda, and have products
        that have gained wide customer acceptance in the marketplace. The greater
        financial resources of such competitors will permit them to implement extensive
        marketing and promotional programs.
Lack
        of Property and General Liability Insurance
.
        Puda
        and is self-insured and does not carry any property insurance, general liability
        insurance, or any other insurance that covers the risks of their business
        operations. As a result, any material loss or damage to its properties or
        other
        assets, or personal injuries arising from its business operations would have
        a
        material adverse affect on its financial condition and operations.
-20-
Terrorist
        Attacks and Military Conflict
.
        Terrorist attacks and threats, escalation of military activity in response
        to
        such attacks or acts of war may negatively affect Puda's business, financial
        condition and results of operations. Puda's business is affected by general
        economic conditions, fluctuations in consumer confidence and spending, and
        market liquidity, which can decline as a result of numerous factors outside
        of
        its control, such as terrorist attacks and acts of war. Future terrorist
        attacks, rumors or threats of war, actual conflicts involving the PRC or
        its
        allies, or military or trade disruptions affecting Puda's customers may
        materially adversely affect its operations. As a result, there could be delays
        or losses in transportation and deliveries of processed coal to Puda's
        customers, decreased sales of its coal and extension of time for payment
        of
        accounts receivable from its customers. Strategic targets such as energy-related
        assets may be at greater risk of future terrorist attacks than other targets.
        In
        addition, disruption or significant increases in energy prices could result
        in
        government-imposed price controls. It is possible that any, or a combination,
        of
        these occurrences could have a material adverse effect on Puda's business,
        financial condition and results of operations.
Customer
        Creditworthiness
.
        Puda's
        ability to collect payments from its customers could be impaired if their
        creditworthiness deteriorates.   Puda's ability to receive payment for
        processed coal sold and delivered depends on the continued creditworthiness
        of
        its customers. Puda's customer base is changing with deregulation as utilities
        sell their power plants to their non-regulated affiliates or third parties.
        These new power plant owners may have credit ratings that are below investment
        grade. If deterioration of the creditworthiness of other electric power
        generator customers or trading counterparties continues, Puda's business could
        be adversely affected.
Expansion
        Risks
.
        Puda
        anticipates that its proposed expansion of its coal crushing, washing and
        processing plants may include the construction of new or additional facilities.
        Puda's cost estimates and projected completion dates for construction of new
        production facilities may change significantly as the projects progress.
        In
        addition, Puda's projects will entail significant construction risks, including
        shortages of materials or skilled labor, unforeseen environmental or engineering
        problems, weather interferences and unanticipated cost increases, any of
        which
        could have a material adverse effect on the projects and could delay their
        scheduled openings. A delay in scheduled openings will delay Puda's receipt of
        increased sales revenues. There is no assurance that Puda will be able to
        sell
        any or all of the cleaned coal that any newly-constructed capacity could
        produce, and there is no assurance that Puda will be able to source sufficient
        raw coal to allow it to utilize such additional processing capacity. The
        projects of Puda to finance, develop, and expand its coal processing facilities
        will be subject to the many risks inherent in the rapid expansion of a high
        growth business enterprise, including unanticipated design, construction,
        regulatory and operating problems, and the significant risks commonly associated
        with implementing a marketing strategy in changing and expanding markets.
        There
        can be no assurance that any of these projects will become operational within
        the estimated time frames and projected budgets at the time Puda enters into
        a
        particular agreement, or at all. In addition, Puda may develop projects as
        joint
        ventures in an effort to reduce its financial commitment to individual projects.
        There can be no assurance that the significant expenditures required to expand
        its coal crushing, washing and processing plants will ultimately result in
        the
        establishment of increased profitable operations. When Puda's future expansion
        projects become operational, it will be required to add and train personnel,
        expand its management information systems and control expenses. If it does
        not
        successfully address its increased management needs or Puda is otherwise
        is
        unable to manage its growth effectively, Puda's operating results could be
        materially and adversely affected.
-21-
Government
        Regulation
.
        Puda is
        subject to extensive regulation by China's Mining Ministry, and by other
        county
        and local authorities in jurisdictions in which its products are processed
        or
        sold, regarding the processing, storage, and distribution of its products.
        Puda's processing facilities are subject to periodic inspection by national,
        county and local authorities. Puda believes that it is currently in substantial
        compliance with all material governmental laws and regulations and maintains
        all
        material permits and licenses relating to its operations. Nevertheless, there
        can be no assurance that Puda will continue to be in substantial compliance
        with
        current laws and regulations, or whether Puda will be able to comply with
        any
        future laws and regulations. To the extent that new regulations are adopted,
        Puda will be required to conform its activities in order to comply with such
        regulations. Failure by Puda to comply with applicable laws and regulations
        could subject Puda to civil remedies, including fines, injunctions, recalls
        or
        seizures, as well as potential criminal sanctions, which could have a material
        and adverse effect on its business, operations and finances.
Doing
        Business in the PRC
.
        Doing
        business in the PRC involves various risks including internal and international
        political risks, evolving national economic policies as well as financial
        accounting standards, expropriation and the potential for a reversal in economic
        conditions. Since the late 1970s, the government of the PRC has been reforming
        the Chinese economic system. These reforms have resulted in significant economic
        growth and social progress. Although Puda believes that economic reform and
        the
        macroeconomic policies and measures adopted by the current PRC government
        will
        continue to have a positive effect on economic development in the PRC and
        that
        Puda will continue to benefit from such policies and measures, these policies
        and measure may from time to time be modified or revised. Adverse changes
        in
        economic policies of the PRC government or in the laws and regulations, if
        any,
        could have a material and adverse effect on the overall economic growth of
        the
        PRC, and could adversely affect Puda's business operations.
Foreign
        Currency Exchange
.
        The PRC
        currency, "Renminbi", is not a freely convertible currency, which could limit
        Puda's ability to obtain sufficient foreign currency to support its business
        operations in the future. Puda relies on the PRC government's foreign currency
        conversion policies, which may change at any time, in regard to its currency
        exchange needs. Puda receives all of its revenues in Renminbi, which is not
        freely convertible into other foreign currencies. In the PRC, the government
        has
        control over Renminbi reserves through, among other things, direct regulation
        of
        the conversion of Renminbi into other foreign currencies and restrictions
        on
        foreign imports. Although foreign currencies which are required for "current
        account" transactions can be bought freely at authorized PRC banks, the proper
        procedural requirements prescribed by PRC law must be met. At the same time,
        PRC
        companies are also required to sell their foreign exchange earnings to
        authorized PRC banks and the purchase of foreign currencies for capital account
        transactions still requires prior approval of the PRC government. This type
        of
        heavy regulation by the PRC government of foreign currency exchange restricts
        certain of our business operations and a change in any of these government
        policies, or any other, could further negatively impact our
        operations.
Fluctuations
        in the exchange rate between the PRC currency and the United States dollar
        in
        the future could adversely affect Puda's operating results. The functional
        currency of Puda's operations in the PRC is "Renminbi". Results of Puda's
        operations are translated at average exchange rates into United States dollars
        for purposes of reporting results. As a result, fluctuations in exchange
        rates
        may adversely affect Puda's expenses and results of operations as well as the
        value of its assets and liabilities. Fluctuations may adversely affect the
        comparability of period-to-period results. Although Puda may use hedging
        techniques in the future (which it currently does not use), Puda may not
        be able
        to eliminate the effects of currency fluctuations. Thus, exchange rate
        fluctuations could have a material adverse impact on Puda's operating results
        and stock prices.
-22-
Timely
        Information
.
        As a
        company based in the PRC, Puda's shareholders may have greater difficulty in
        obtaining information about Puda on a timely basis than would shareholders
        of a
        U.S.-based company. Puda's operations will continue to be conducted in the PRC
        and shareholders may have difficulty in obtaining information about Puda
        from
        sources other than Puda itself. Information available from newspapers, trade
        journals, or local, regional or national regulatory agencies such as issuance
        of
        construction permits, contract awards for development projects, etc. will
        not be
        readily available to shareholders. Shareholders will be dependent upon Puda's
        management for reports of Puda's progress, development, activities and
        expenditure of proceeds.
Payment
        of Dividends
.
        In
        order to pay dividends, a conversion of Renminbi into US dollars is required.
        Under current PRC law, the conversion of Renminbi into foreign currency
        generally requires government consent. Government authorities may impose
        restrictions that could have a negative impact in the future on the conversion
        process and upon the ability of Puda to meet its cash needs, and to pay
        dividends. However, a subsidiary of Purezza is presently classified as a
        wholly-owned foreign enterprise ("WFOE") in the PRC that has verifiable foreign
        investment in the PRC, funding having been made through an official PRC banking
        channel. Because this subsidiaries of Purezza qualifies for treatment as
        a WFOE,
        the subsidiary can convert Renminbi, declare dividends and its funds can
        be
        repatriated to Purezza in the United States under current laws and regulations
        in the PRC, subject to limitations and restrictions imposed by PRC laws.
        However, the PRC laws governing foreign currency exchange are evolving, and
        changes in such laws may adversely affect the ability to convert Renminbi,
        declare dividends and repatriate funds to the United States
Contractual
        Arrangements
.
        In
        order to comply with PRC regulatory requirements, Puda is operated
        by
a
        wholly-owned foreign enterprise ("WFOE") in the PRC, which is owned entirely
        by
        Purezza's direct subsidiary based in the British Virgin Islands ("BVI Company").
        As a result Purezza does not have a direct
controlling
        ownership in Puda. If the PRC government determines that these agreements
        are
        not in compliance with applicable regulations, Purezza's business interests in
        the PRC could be adversely affected. Purezza controls and operates Puda's
        business through contractual arrangements between the WFOE, Puda and the
        individual owners of Puda, but Purezza, the WFOE and the BVI Company do not
        have
        an equity ownership in Puda.
More
        specifically, the WFOE h
as
        agreed
        to advise, consult, manage and operate Puda's business, to provide certain
        financial accommodations to Puda, and to license certain technology to Puda
        for
        use in its business, in exchange for Puda's payment of all of its operating cash
        flow to the WFOE. Further, each of the individual owners of Puda have granted
        the WFOE the exclusive right and option to acquire all of their registered
        capital of Puda and have authorized the WFOE to vote at any meeting or action
        of
        the owners of Puda and to act as the representative for such owners in all
        matters respecting Puda.
-23-
Although
        we believe we are in compliance with current PRC regulations, we cannot be
        sure
        that the PRC government would view these operating and contractual arrangements
        to be in compliance with PRC licensing, registration or other regulatory
        requirements, with existing policies or with requirements or policies that
        may
        be adopted in the future. If we are determined not to be in compliance, the
        PRC
        government could revoke our business and operating licenses, require us to
        discontinue or restrict our operations, restrict our right to collect revenues,
        require us to restructure our operations, impose additional conditions or
        requirements with which we may not be able to comply, impose restrictions
        on our
        business operations or on our customers, or take other regulatory or enforcement
        actions against us that could be harmful to our business. We may also encounter
        difficulties in obtaining performance under or enforcement of related
        contracts.
We
        must
        reply on these operating and contractual arrangements to control and operate
        Puda's business. These contractual arrangements may not be as effective in
        providing control over these entities as direct ownership. For example, Puda
        could fail to take actions required for our business or fail to maintain
        and
        operate its business in compliance with its contractual obligation to do
        so.
        Puda may transact business with parties not affiliated with us. If Puda fails
        to
        perform under its agreements with us, we may have to rely on legal remedies
        under PRC law, which we cannot be sure would be effective. In addition, we
        cannot be certain that the individual equity owners of Puda would always
        act in
        the best interests of Purezza, especially if they leave Purezza.
Substantially
        all profits generated from Puda will be paid to the WFOE through related
        party
        transactions under contractual agreements. We believe that the terms under
        these
        contractual agreements are in compliance with the laws in the PRC. However,
        the
        interpretation and application of existing PRC laws, regulations and policies,
        the stated positions of the PRC authorities and possible new laws, regulations
        or policies, there are substantial uncertainties regarding the application
        of
        PRC laws, especially with respect to existing and future foreign investments
        in
        the PRC. As such, it is possible these contractual agreements may be subject
        to
        differing applications and interpretations under PRC laws. Further, due to
        the
        uncertainties surrounding the interpretation of the transfer pricing rules
        relating to related party transactions in the PRC, it is possible that tax
        authorities in the PRC may challenge the transfer prices that we have used
        for
        related party transactions among our entities in the PRC in the
        future.
Risks
        Related to Purezza
Possible
        Reliance upon Financial Statements
.
        Purezza
        has required audited and unaudited financial statements from Puda. However,
        not
        all required audited and unaudited financials will be available at the Closing.
        Since Purezza is subject to the reporting provisions of the Securities Exchange
        Act of 1934, as amended (the "Exchange Act"), it will be required to furnish
        certain information about significant acquisitions, including audited and
        unaudited financial statements for any business that it acquires. Consequently,
        the continued ability of Purezza to remain a reporting company and publicly
        trading will be in jeopardy if Puda cannot furnish the required audited and
        unaudited financials in a timely manner and, in the event of such failure
        to
        furnish, the value of your investment in Purezza may be significantly reduced.
-24-
Other
        Regulation
.
        Puda's
        business will be subject to regulation and/or licensing by federal, state,
        or
        local authorities as well as central, provincial, local and municipal regulation
        and licensing in the PRC. Compliance with such regulations and licensing
        can be
        expected to be a time-consuming, expensive process. Compliance with foreign
        country laws and regulations affecting foreign investment, business operations,
        currency exchange, repatriation of profits, and taxation, will increase the
        risk
        of your investment.
No
        Foreseeable Dividends
.
        Purezza
        does not intend to pay any dividends. Purezza does not foresee making any
        cash
        distributions in the manner of a dividend or otherwise.
Dilutive
        Effects of Issuing Additional Common Stock
.
        The
        Puda BVI Members will be issued preferred stock that is convertible into
        a large
        number of shares of Purezza's common stock which will dilute the ownership
        interest of Purezza's current stockholders. In addition, it will be likely that
        there will be additional authorized but unissued shares that may be later
        issued
        by the then new management for any purpose without the consent or vote of
        the
        stockholders. These issuances that may occur will dilute the interests of
        Purezza's stockholders after the Closing.
Thinly-traded
        Public Market
.
        Purezza's securities will be very thinly traded, and the price if traded may not
        reflect the value of Purezza. Moreover, a reverse split of the shares is
        expected which may not reflect the value of Purezza either. There can be
        no
        assurance that there will be an active market for Purezza's shares either now or
        in the future. The market liquidity will be dependant on the perception of
        the
        operating business and any steps that its management might take to bring
        the
        company to the awareness of investors. There can be no assurance given that
        there will be any awareness generated. Consequently, investors may not be
        able
        to liquidate their investment or liquidate it at a price that reflects the
        value
        of the business. If a more active market should develop, the price may be
        highly
        volatile. Because there may be a low price for Purezza's securities, many
        brokerage firms may not be willing to effect transactions in the securities.
        Even if an investor finds a broker willing to effect a transaction in the
        securities, the combination of brokerage commissions, transfer fees, taxes,
        if
        any, and any other selling costs may exceed the selling price. Further, many
        lending institutions will not permit the use of such securities as collateral
        for any loans.
Possible
        Rule 144 Sales
.
        The
        majority of Purezza's shares outstanding prior to the Closing were "restricted
        securities" within the meaning of Rule 144 under the Securities Act of 1933,
        as
        amended (the "Act"). As restricted shares, these shares may be resold only
        pursuant to an effective registration statement or under the requirements
        of
        Rule 144 or other applicable exemption from registration under the Act and
        as
        required under applicable state securities laws. Rule 144 provides in essence
        that a person who has held restricted securities for a period of one year
        may,
        under certain conditions, sell every three months, in brokerage transactions,
        a
        number of shares that does not exceed the greater of 1.0% of a company's
        outstanding common stock or the average weekly trading volume during the
        four
        calendar weeks prior to the sale. There is no limit on the amount of restricted
        securities that may be sold by a non-affiliate after the restricted securities
        have been held by the owner for a period of two years. Current stockholders
        who
        own 10% or more of Purezza's shares will likely be deemed an affiliate until 90
        days after the exchange transaction is completed. After such 90-day period,
        and
        assuming said shares have been held for more than two years, these stockholders
        may be able to sell their shares without volume restrictions. A sale under
        Rule
        144 or under any other exemption from the Act, if available, or pursuant
        to
        subsequent registrations of Purezza's shares, may have a depressive effect upon
        the price of Purezza's shares in any market that may develop.
-25-
Executive
        Compensation
Summary
        Compensation Table
The
        following table sets forth information concerning all compensation paid for
        services to Puda by its executive officers in all capacities for 2002, 2003
        and
        2004. No other executive officer received total annual salary and bonus payments
        in excess of $100,000 during these periods.
Long
                    Term Compensation
Annual
                    Compensation
Awards
Payouts
Name
and
Principal
Position
Year
Salary
                    ($)
Bonus
                    ($)
Other
Annual
                    Compensation ($)
Restricted
Stock
                    Award(s)
($)
Securities
Underlying
                    Options/
SARs
                    (#) (2)
LTIP
Payouts
                    ($)
All
                    Other
Compensation
($)
Zhao
                    Ming
(Chairman
                    and Chief Executive Officer)
2004
2003
2002
4,833
5,075
4,261
--
--
-
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
Zhao
                    Yao
(Chief
                    Operating Officer and Director)
2004
2003
2002
4,833
5,075
4,261
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
Jin
                    Xia
(Chief
                    Financial Officer)
2004
2003
2002
2,388
1,913
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
Option
        Grants
Puda
        does
        not maintain any equity incentive or stock option plan. Accordingly, Puda
        did
        not grant options to purchase any equity interests to any persons, and no
        stock
        options are issued or outstanding.
Employment
        Contracts
Puda
        does
        not have employment agreements with any of its executive officers or key
        employees. Purezza does not have employment agreements with any of its newly
        appointed executive officers.
-26-
Security
        Ownership of Certain Beneficial Owners and Management
and
        Related Stockholder Matters.
The
        following table sets forth certain information regarding Purezza's common stock
        beneficially owned on July 15, 2005, prior to giving effect to the Closing,
        for
        (i) each stockholder known to be the beneficial owner of 5% or more of Purezza's
        outstanding common stock, (ii) each executive officer and director, and (iii)
        all executive officers and directors as a group. In general, a person is
        deemed
        to be a "beneficial owner" of a security if that person has or shares the
        power
        to vote or direct the voting of such security, or the power to dispose or
        to
        direct the disposition of such security. A person is also deemed to be a
        beneficial owner of any securities of which the person has the right to acquire
        beneficial ownership within 60 days. At July 15, 2005, immediately prior
        to the
        Closing, Purezza had 59,000,000 shares of common stock outstanding.
Name
Number
                  of Shares Beneficially Owned
Percent
                  of Shares
Kevin
                  R. Keating
936A
                  Beachland Boulevard, Suite 13
Vero
                  Beach, Florida 32963
2,000,000
                  (1
)
3.4
%
Keating
                  Reverse Merger Fund, LLC
5251
                  DTC Parkway, Suite 1090
Greenwood
                  Village, Colorado 80111
47,185,000
                  (2
)
80.0
%
All
                  Executive Officers and Directors as a group
2,000,000
3.4
%
(1)
Kevin
                  R. Keating is not affiliated with and has no equity interest in
                  Keating
                  Reverse Merger Fund, LLC and disclaims any beneficial interest
                  in the
                  shares of Purezza's Common Stock owned by Keating Reverse Merger Fund,
                  LLC.
(2)
Keating
                  Reverse Merger Fund, LLC is not owned by or affiliated with Kevin
                  R.
                  Keating and disclaims any beneficial interest in the shares of
                  Purezza's
                  Common Stock owned by Kevin R.
                  Keating.
The
        following table sets forth certain information regarding Purezza's common stock
        beneficially owned on July 15, 2005, after giving effect to the Closing,
        for (i)
        each stockholder known to be the beneficial owner of 5% or more of Purezza's
        outstanding common stock, (ii) each executive officer and director, and (iii)
        all executive officers and directors as a group, on an approximated pre-
        and
        post- Reverse Split basis. Unless otherwise indicated, each person in the
        table
        has sole voting and investment power with respect to the shares shown. The
        table
        assumes a total of 737,500,000 and 73,750,000 shares of Purezza's common stock
        outstanding as of July 15, 2005, on a pre- and post- Reverse Split basis,
        respectively, and on an as-converted basis.
Name
                  of Beneficial Owner
Amount
                  of Beneficial Ownership
(Pre-Reverse
                  Split)
Amount
                  of Beneficial Ownership
(Post-Reverse
                  Split)
Percent
                  of Beneficial Ownership
Zhao
                  Ming (1), (2)
531,000,000
53,100,000
72.0
%
Zhao
                  Yao (1), (2)
132,750,000
13,275,000
18.0
%
Jin
                  Xia (1)
0
0
0
%
Wang
                  Lisheng (1)
0
0
0
%
Kevin
                  R. Keating
936A
                  Beachland Boulevard, Suite 13
Vero
                  Beach, Florida 32963
2,000,000
200,000
0.3
%
Keating
                  Reverse Merger Fund, LLC (2)
5251
                  DTC Parkway, Suite 1090
Greenwood
                  Village, Colorado 80111
47,185,000
4,718,500
6.4
%
All
                  Executive Officers and Directors as a group
663,750,000
66,375,000
90.0
%
(1)
Address
                  is c/o Shanxi Puda Resources Co, Ltd. 426 Xuefu Street, Taiyuan,
                  Shanxi
                  Province, PRC. The beneficial ownership of Purezza's common stock is based
                  on the holder's respective ownership of Purezza's Series A Convertible
                  Preferred Stock, on an as-converted basis prior to the proposed
                  Reverse
                  Split. Each share of Series A Convertible Preferred Stock is convertible
                  into 678.5 shares of Purezza's common stock on a pre-Reverse Split basis.
                  The shares of Series A Convertible Preferred Stock will immediately
                  and
                  automatically be converted into shares of Purezza's common stock upon the
                  approval by a majority of Purezza's stockholders (voting together on an
                  as-converted-to-common-stock basis), following the Closing, of
                  an increase
                  in the number of authorized shares of Purezza's common stock from
                  100,000,000 to 150,000,000, and a 1 for 10 reverse stock split
                  of
                  Purezza's outstanding common stock.
(2)
Effective
                  as of the Closing, KRM Fund and each Puda BVI Member have agreed
                  to vote
                  their shares of Purezza's common stock (voting together on an
                  as-converted-to-common-stock basis) to (i) elect a person designated
                  by
                  KRM Fund from time to time (the "KRM Designate") to Purezza's board for a
                  period of one year following the Closing, (ii) elect such other
                  persons
                  that may be designated by Zhao Ming from time to time to fill any
                  vacant
                  position on the board of directors (other than the KRM Designate),
                  and
                  (iii) approve the Reverse Split, an increase in Purezza's authorized
                  common stock from 100,000,000 to 150,000,000, and a corporate name
                  change.
Zhao
        Ming
        and Zhao Yao are brothers.
-27-
Certain
        Relationships and Related Transactions involving Puda
Other
        than the employment arrangements described above in "Executive Compensation" and
        the transactions described below or elsewhere in this Report, since December
        31,
        2002, there has not been, nor is there currently proposed, any transaction
        or
        series of similar transactions to which Puda was or will be a party:
-
in
                  which the amount involved exceeds $60,000;
                  and
-
in
                  which any director, executive officer, shareholder who beneficially
                  owns
                  5% or more of Purezza's common stock or any member of their immediate
                  family had or will have a direct or indirect material
                  interest.
Transactions
        with Officers, Directors and 5% Holders of Puda
Puda
          declared cash distributions to its owners, Zhao Ming (80%) and Zhao Yao
          (20%),
          of $1.295 million and $2.393 million in 2003 and 2004, respectively. Of
          these
          amounts, $3.204 million was paid in 2004 with a distribution payable balance
          of
          $484,000 as of December 31, 2004.
Puda
          currently secures raw coal from a diversified pool of local Liulin County
          coal
          mines, including Liulin Jucai Coal Industry Co. Ltd. ("Jucai Coal"), a coal mine
          that is owned 75
%
          by Zhao
          Yao. Jucai Coal supplies raw coal to both Puda and other unrelated parties.
          The
          Jucai Coal mining operations produced 450,000 and 400,000 tons of raw coal
          in
          2003 and 2004, respectively. Out of this annual raw coal production, Jucai
          Coal
          sold approximately 20% and 10% of its raw coal production in 2003 and 2004,
          respectively, to Puda at prevailing market prices. The raw coal purchased
          from
          Jucai Coal accounted for approximately 19% and 12% of Puda's total raw coal
          purchases in 2003 and 2004, respectively.
As
        of
        December 31, 2003 and 2004, Puda had the following amounts due from/to related
        parties:
December
                  31,
2003
2004
US$
US$
Receivable
                  from Shanxi Puda Resources Group Limited ("Puda Group"), a related company
                  with common owners
$
2,871,000
$
2,234,000
Receivable
                  from an owner, Zhao Ming
--
2,000
Total
                  related party receivables
$
2,871,000
$
2,236,000
Payable to an owner, Zhao Yao
$
186,000
$
197,000
Accounts
                  payable to Shanxi Liulin Jucai Coal Industry Co., Ltd., a related
                  party
                  with common owner
114,000
268,000
Total
                  related party payables
$
300,000
$
465,000
The
        above
        related party receivable and payable balances are unsecured, interest-free
        and
        there are no fixed terms for repayment.
-28-
The
        amount payable to Zhao Yao represents land use rights paid by him on behalf
        of
        Puda.
In
        2001,
        Puda entered into agreements with Puda Group, to lease an office and certain
        equipment. In the years ended December 31, 2003 and 2004, rental expenses
        payable to Puda Group were $24,000 and $24,000 respectively.
By
        an
        agreement entered into between Puda and Puda Group on April 25, 2005, Puda
        Group
        agreed to pay all the tax liabilities (including surcharges and penalties)
        of
        Puda with retrospective effect from its establishment to December 31, 2004.
        As
        of December 31, 2003 and 2004, Puda has paid $2,800,000 and $5,768,000,
        respectively, to Puda Group for payment of income taxes and value-added tax
        ("VAT"). In December 2004, Puda Group has paid Puda's income taxes of $1,678,000
        and VAT of $1,950,000 to the China Tax Bureau. In April 2005, Puda Group
        has
        paid Puda's VAT of $251,000 to the China Tax Bureau. Puda expects that its
        income tax for the year 2004 will be paid to the China Tax Bureau in July
        2005.
Puda
        currently leases the
Shanxi
        Liulin Jiucai Plant
which
        has
        an annual clean coal washing capacity of 100,000 tons. This facility is located
about
        two
        miles from
the premises of coal mine owned and operated by Shanxi Liulin
        Jucai Coal Industry Co., Limited ("Jucai Coal"). Zhao Yao is a 75
%
        owner
        of Jucai Coal.
Jucai
        Coal leases this coal processing facility to Puda.
The leasing
        agreement was entered into on December 2, 2001 for a term of 5 years. The
        cost
        for the leased capacity is approximately $604,000 annually with four quarterly
        payments per year.
It
        is
        possible that this lease may not be renewed when it expires.
Principal
        Accountant Fees and Services
Moore
        Stephens ("Moore Stephens"), Puda's independent registered public accounting
        firm, billed Puda aggregate audit fees of approximately $216,000, including
        recoverable disbursements of approximately $16,000, for professional services
        rendered for the audit of its annual financial statements for the years ended
        December 31, 2003 and 2004.
Zhao
        Ming
        was directly responsible for interviewing and retaining its independent
        accountant, considering the accounting firm's independence and effectiveness,
        and pre-approving the engagement fees and other compensation to be paid to,
        and
        the services to be conducted by, the independent accountant. Zhao Ming did
        not
        delegate these responsibilities. During 2003 and 2004, Zhao Ming pre-approved
        100% of the services described above.
Legal
        Proceedings
Puda
        is
        not involved in any lawsuit outside the ordinary course of business the
        disposition of which would have a material effect upon either its results
        of
        operations, financial position, or cash flows.
-29-
Item
        9.01 Financial Statements and Exhibits.
(a)
Financial
                  statements of business acquired
.
The
                  Audited Financial Statements of Shanxi Puda Resources Co, Ltd.
                  ("Puda") as
                  of December 31, 2004 and 2003, and for the years ended December
                  31, 2004
                  and 2003 are included following this Item
                  9.01(a).
The
                  Audited Financial Statements of Puda Investment Holding Limited
                  ("Puda
                  BVI") and Taiyuan Putai Business Consulting Co., Ltd. ("Putai"),
                  separately, as of December 31, 2004, and for the year ended December
                  31,
                  2004 will be included in an amendment to this Current Report on
                  Form 8-K
                  which Purezza anticipates filing within the time period provided
                  by this
                  form.
The
                      Unaudited Financial Statements of Puda as of March 31, 2005,
                      and for the
                      three month periods ended March 31, 2005 and 2004 will be included
                      in an
                      amendment to this Current Report on Form 8-K which Purezza
                      anticipates
                      filing within the time period provided by this
                      form.
The
                      Unaudited Financial Statements of Putai and Puda BVI, separately,
                      as of
                      March 31, 2005, and for the three month period ended March
                      31, 2005 will
                      be included in an amendment to this Current Report on Form
                      8-K which
                      Purezza anticipates filing within the time period provided
                      by this
                      form.
-30-
SHANXI
          PUDA RESOURCES CO., LTD.
FINANCIAL
          STATEMENTS
December
          31, 2003 And 2004
Together
          With Report Of
Independent
          Registered Public Accounting Firm
SHANXI
          PUDA RESOURCES CO., LTD.
INDEX
          TO FINANCIAL STATEMENTS
Report
                    of Independent Registered Public Accounting Firm
2
Balance
                    Sheets
3
Statements
                    of Operations
4
Statements
                    of Changes in Owners' Equity
5
Statements
                    of Cash Flows
6
Notes
                    to Financial Statements
7-20
REPORT
          OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To
          the
          Board of Directors and Owners of
Shanxi
          Puda Resources Co., Ltd.
We
          have
          audited the accompanying balance sheets of Shanxi Puda Resources Co., Ltd.
          as of
          December 31, 2003 and 2004, and the related statements of operations, changes
          in
          owners' equity, and cash flows for the years then ended. These financial
          statements are the responsibility of the Company's management. Our
          responsibility is to express an opinion on these financial statements based
          on
          our audits.
We
          conducted our audits in accordance with
the
          standards of the Public Company Accounting Oversight Board (United States).
          Those standards require that we plan and perform the audit to obtain reasonable
          assurance about whether the financial statements are free of material
          misstatement. An audit includes examining, on a test basis, evidence supporting
          the amounts and disclosures in the financial statements. An audit also
          includes
          assessing the accounting principles used and significant estimates made
          by
          management, as well as evaluating the overall financial statement presentation.
          We believe that our audits provide a reasonable basis for our
          opinion.
In
          our
          opinion, the financial statements referred to above present fairly, in
          all
          material respects, the financial position of Shanxi Puda Resources Co.,
          Ltd. as
          of December 31, 2003 and 2004 and the results of its operations and its
          cash
          flows for the
years
          then ended in conformity with accounting principles generally accepted
          in the
          United States of America.
Moore
          Stephens
Certified
          Public Accountants
Hong
          Kong
June
          9,
          2005
-2-
SHANXI
          PUDA RESOURCES CO., LTD.
BALANCE
          SHEETS
December
          31, 2003 and 2004
(In
          thousand of United States dollars)
DECEMBER
                      31,
Note(s)
2003
2004
US$'000
US$'000
ASSETS
CURRENT
                      ASSETS
Cash
                      and cash equivalents
913
313
Short
                      term investments
--
117
Accounts
                      receivable (net)
3
2,340
2,722
Notes
                      receivable - trade
4
266
638
Other
                      receivables
-
                      Related parties
5
2,871
2,236
-
                      Third parties
2
68
Deposits
                      and prepayments
459
529
Inventories
6
3,585
3,565
Total
                      current assets
10,436
10,188
PROPERTY,
                      PLANT AND EQUIPMENT, NET
7
1,085
974
INTANGIBLE
                      ASSETS
8
186
182
TOTAL
                      ASSETS
11,707
11,344
LIABILITIES
                      AND OWNERS' EQUITY
CURRENT
                      LIABILITIES
Accounts
                      payable
-
                      Related party
5
114
268
-
                      Third parties
565
448
Notes
                      payable
9
72
--
Other
                      payables
-
                      Related party
5
186
197
-
                      Third parties
155
291
Accrued
                      expenses
175
248
Advances
                      from customers
368
--
Income
                      taxes payable
10
1,821
2,008
VAT
                      payable
10
1,107
251
Distribution
                      payable
1,295
484
Total
                      current liabilities
5,858
4,195
COMMITMENT
                      AND CONTINGENCIES
11
OWNERS'
                      EQUITY
Paid-in
                      capital
2,717
2,717
Statutory
                      surplus reserve fund
12
675
1,243
Retained
                      earnings
2,457
3,189
Total
                      owners' equity
5,849
7,149
TOTAL
                      LIABILITIES AND OWNERS' EQUITY
11,707
11,344
The
          accompanying notes are an integral part of these financial
          statements.
-3-
SHANXI
          PUDA RESOURCES CO., LTD.
STATEMENTS
          OF OPERATIONS
For
          the years ended December 31, 2003 and 2004
(In
          thousand of United States dollars)
YEAR
                    ENDED DECEMBER 31,
Note(s)
2003
2004
US$'000
US$'000
NET
                    REVENUE
13,397
19,735
COST
                    OF REVENUE
5
(9,209
)
(13,229
)
GROSS
                    PROFIT
4,188
6,506
OPERATING
                    EXPENSES
Selling
                    expenses
264
322
General
                    and administrative expenses
5
277
203
Other
                    operating expenses
13
--
414
TOTAL
                    OPERATING EXPENSES
541
939
INCOME
                    FROM OPERATIONS
3,647
5,567
LOSS
                    ON SHORT TERM INVESTMENT
--
(4
)
INTEREST
                    EXPENSE
(11
)
(4
)
INCOME
                    BEFORE INCOME TAXES
3,636
5,559
INCOME
                    TAXES
14
(1,234
)
(1,866
)
NET
                    INCOME
2,402
3,693
The
          accompanying notes are an integral part of these financial
          statements.
-4-
SHANXI
          PUDA RESOURCES CO., LTD.
STATEMENTS
          OF CHANGES IN OWNERS' EQUITY
For
          the years ended December 31, 2003 and 2004
(In
          thousand of United States dollars)
PAID-UP
CAPITAL
STATUTORY
SURPLUS
RESERVE
RETAINED
EARNINGS
TOTAL
OWNERS'
                    EQUITY
RMB'000
US$'000
US$'000
US$'000
US$'000
Balance,
                    January 1, 2003
22,500
2,717
310
1,715
4,742
Net
                    income for 2003
--
--
--
2,402
2,402
Transfer
--
--
365
(365
)
--
Distribution
--
--
--
(1,295
)
(1,295
)
Balance,
                    December 31, 2003
22,500
2,717
675
2,457
5,849
Net
                    income for 2004
--
--
--
3,693
3,693
Transfer
--
--
568
(568
)
--
Distribution
--
--
--
(2,393
)
(2,393
)
Balance,
                    December 31, 2004
22,500
2,717
1,243
3,189
7,149
The
          accompanying notes are an integral part of these financial
          statements.
-5-
SHANXI
          PUDA RESOURCES CO., LTD.
STATEMENTS
          OF CASH FLOWS
For
          the years ended December 31, 2003 and 2004
(In
          thousand of United States dollars)
2003
2004
US$'000
US$'000
CASH
                    FLOWS FROM OPERATING ACTIVITIES:
Net
                    income
2,402
3,693
Adjustments
                    to reconcile net income to
net
                    cash used in operating activities
Unrealized
                    loss on short term investments
--
4
Amortization
                    of land use right
3
4
Depreciation
111
111
Provision
                    for doubtful debts
13
1
Changes
                    in operating assets and liabilities:
Increase
                    in accounts receivable
(847
)
(383
)
Increase
                    in notes receivable
(12
)
(372
)
Increase
                    in other receivables, deposits and prepayments
(1,899
)
499
(Decrease)/increase
                    in inventories
(931
)
20
(Decrease)/increase
                    in accounts payable
(112
)
37
Decrease
                    in notes payable
(73
)
(72
)
Increase
                    in accrued expenses
63
73
Decrease
                    in advance from customers
(146
)
(368
)
(Decrease)/increase
                    in other payables
(293
)
147
Increase
                    in income tax payable
1,235
187
Increase/(decrease)
                    in VAT payable
712
(856
)
Net
                    cash provided by operating activities
226
2,725
CASH
                    FLOWS FROM INVESTING ACTIVITES
Payment
                    for purchase of short term investments
--
(121
)
Net
                    cash used in investing activities
--
(121
)
CASH
                    FLOWS FROM FINANCING ACTIVITES
Distribution
                    paid to owners
--
(3,204
)
Net
                    cash used in financing activities
--
(3,204
)
Net
                    increase/(decrease) in cash and cash
Equivalents
226
(600
)
Cash
                    and cash equivalents at beginning of year
687
913
Cash
                    and cash equivalents at end of year
913
313
Supplemental
                    schedule of cash flow information:
Cash
                    paid during the year for:
Interest
11
4
Income
                    taxes
--
1,678
The
          accompanying notes are an integral part of these financial
          statements.
-6-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS
1.
          The Company
Shanxi
          Puda Resources Co., Ltd. ("the Company") was established on 7 June 1995 as a
          company with limited liability under the laws of The People's Republic of China
          ("PRC"). The Company mainly processes and washes raw coal and sells from its
          plants in Shanxi Province, high-quality, low sulfur refined coal for industrial
          clients mainly in Central and Northern China.
The
          Company has a registered capital of RMB22,500,000 (US$2,217,000) which
          is fully
          paid-up. The owners of the Company are Mr. Zhao Ming (80%) and Mr. Zhao
          Yao
          (20%).
2.
          Summary of Significant Accounting Policies
(a)
          Basis of Presentation
The
          accompanying financial statements were prepared in accordance with the
          accounting principles generally accepted in the United States of America
          ("US
          GAAP").
(b)
          Use of Estimates
In
          preparing financial statements in conformity with accounting principles
          generally accepted in the United States of America, management is required
          to
          make estimates and assumptions that affect the reported amounts of assets
          and
          liabilities and the disclosure of contingent assets and liabilities at
          the date
          of the financial statements and revenues and expenses during the reported
          periods. Significant estimates include depreciation and allowance for doubtful
          accounts receivable. Actual results could differ from those
          estimates.
(c)
          Cash and Cash Equivalents
The
          Company considers all highly liquid investments with original maturities
          of
          three months or less at the time of purchase to be cash equivalents. As
          of
          December 31, 2003 and 2004 the Company did not have any cash
          equivalents.
(d)
          Short-term Investments
The
          Company classifies its marketable securities as trading securities. Trading
          securities are carried at readily determinable fair value, with the unrealized
          or realized gains and losses, if any, reported in other income in income
          statement. The cost of securities sold is based on the specific-identification
          method.
-7-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS
(e)
          Allowance for Doubtful Accounts
The
          Company recognizes an allowance for doubtful accounts to ensure accounts
          receivable are not overstated due to uncollectibility. An allowance for
          doubtful
          accounts is maintained for all customers based on a variety of factors,
          including the length of time the receivables are past due, significant
          one-time
          events and historical experience. An additional reserve for individual
          accounts
          is recorded when the Company becomes aware of a customer's inability to meet its
          financial obligations, such as in the case of bankruptcy filings or
          deterioration in the customer's operating results or financial position. If
          circumstances related to customers change, estimates of the recoverability
          of
          receivables would be further adjusted.
(f)
          Inventories
Inventories
          comprise raw materials and finished goods and are stated at the lower of
          cost or
          market. Substantially all inventory costs are determined using the weighted
          average basis. Costs of finished goods include direct labor, direct materials,
          and production overhead before the goods are ready for sale. Inventory
          costs do
          not exceed net realizable value.
(g)
          Property, Plant and Equipment, Net
Property,
          plant and equipment is stated at cost. Depreciation is provided principally
          by
          use of the straight-line method over the useful lives of the related assets.
          Expenditures for maintenance and repairs, which do not improve or extend
          the
          expected useful life of the assets, are expensed to operations while major
          repairs are capitalized.
Management
          considers that they have 10% residual value for buildings, and 5% residual
          value
          for other property, plant and equipment. The estimated useful lives are
          as
          follows:
Building
          and
          facility
20
          years
Machinery
          and
          equipment
10
          years
Motor
          vehicles
10
          years
Office
          equipment and
          others
10
          years
The
          gain
          or loss on disposal of property, plant and equipment is the difference
          between
          the net sales proceeds and the carrying amount of the relevant assets,
          and, if
          any, is recognized in the statements of operations.
(h)
          Land Use Rights and Amortization
Land
          use
          right is stated at cost, less amortization. Amortization of land use right
          is
          calculated on the straight-line method, based on the period over which
          the right
          is granted by the relevant authorities in Shanxi, PRC.
-8-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
(i)
          Impairment of Assets
In
          accordance with Statement of Financial Accounting Standards ('SFAS") No. 144,
          "Accounting for Impairment or Disposal of Long-Lived Assets", the Company
          evaluates its long-lived assets to determine whether later events and
          circumstances warrant revised estimates of useful lives or a reduction
          in
          carrying value due to impairment. If indicators of impairment exist and
          if the
          value of the assets is impaired, an impairment loss would be
          recognized.
(j)
          Income Taxes
The
          Company accounts for income taxes under SFAS No. 109, "Accounting for Income
          Taxes". Under SFAS No. 109, deferred tax assets and liabilities are recognized
          for the future tax consequences attributable to differences between the
          financial statement carrying amounts of existing assets and liabilities
          and
          their respective tax bases. Deferred tax assets and liabilities are measured
          using enacted tax rates expected to apply to taxable income in the years
          in
          which those temporary differences are expected to be recovered or settled.
          Under
          SFAS No. 109, the effect on deferred tax assets and liabilities of a change
          in
          tax rates is recognized in income in the period that includes the enactment
          date.
The
          Company reviewed the differences between tax basis under PRC tax laws and
          financial reporting under PRC GAAP, and no material differences were found,
          thus, there were no deferred tax assets or liabilities as of December 31,
          2003
          and 2004 for the Company.
Under
          current PRC tax laws, no tax is imposed in respect to distributions paid
          to
          owners except individual income tax.
(k)
          Revenue Recognition
Revenue
          from goods sold is recognized when title has passed to the purchaser, which
          generally is at the time of delivery.
(l)
          Foreign Currency Transactions
The
          Company's functional currency is Renminbi ("RMB") and its reporting currency is
          U.S. dollars. The Company's balance sheet accounts are translated into U.S.
          dollars at the year-end exchange rates and all revenue and expenses are
          translated into U.S. dollars at the average exchange rates prevailing during
          the
          periods in which these items arise. Translation gains and losses are deferred
          and accumulated as a component of other comprehensive income in owners' equity.
          Transaction gains and losses that arise from exchange rate fluctuations
          from
          transactions denominated in a currency other than the functional currency
          are
          included in the statement of operations as incurred. The translation and
          transaction gains and losses were immaterial for the years ended December
          31,
          2003 and 2004.
The
          PRC
          government imposes significant exchange restrictions on fund transfers
          out of
          the PRC that are not related to business operations. These restrictions
          have not
          had a material impact on the Company because it has not engaged in any
          significant transactions that are subject to the restrictions.
-9-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
(m)
          Fair Value of Financial Instruments
SFAS
          No.
          107, "Disclosures about Fair Values of Financial Instruments", requires
          disclosing fair value to the extent practicable for financial instruments
          that
          are recognized or unrecognized in the balance sheet. The fair value of
          the
          financial instruments disclosed herein is not necessarily representative
          of the
          amount that could be realized or settled, nor does the fair value amount
          consider the tax consequences of realization or settlement.
For
          certain financial instruments, including cash, accounts, related party
          and other
          receivables, accounts payable, other payables and accrued expenses, it
          was
          assumed that the carrying amounts approximate fair value because of the
          near
          term maturities of such obligations.
(n)
          Earnings Per Share
Basic
          earnings per share is computed by dividing the earnings for the year by
          the
          weighted average number of common shares outstanding for the year. Diluted
          earnings per share reflects the potential dilution of securities by including
          other potential common stock, including stock options and warrants, in
          the
          weighted average number of common shares outstanding for a period, if dilutive.
For
          the
          years ended December 31, 2003 and 2004, earnings per share are not shown
          as
          there are no shares outstanding.
(o)
          Accumulated Other Comprehensive Income
Accumulated
          other comprehensive income represents the change in equity of the Company
          during
          the periods presented from foreign currency translation adjustments. These
          transactions are deemed immaterial for the years presented.
3.
          Allowance for Doubtful Receivables
Details
          of allowance for doubtful receivables deducted from accounts receivable
          are as
          follows:-
December
                    31,
2003
2004
US$'000
US$'000
Balance,
                    beginning of year
15
28
Additions
13
1
Balance,
                    end of year
28
29
The
          Company did not have any bad debts in the years ended December 31, 2003
          and
          2004.
-10-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
4.
          Notes Receivable - Trade
Notes
          receivable are issued by banks for settlement of accounts receivable from
          customers. They are not factored and are non-interest bearing.
5.
          Related Party Transactions
As
          of
          December 31, 2003 and 2004, the Company had the following amounts due from/to
          related parties:-
December
                    31,
2003
2004
US$'000
US$'000
Other
                    receivable from Shanxi Puda Resources Group Limited ("Puda Group"), a
                    related company with common owners
2,871
2,234
Other
                    receivable from an owner, Zhao Ming
--
2
2,871
2,236
Accounts
                    payable to Shanxi Liulin Jucai Coal Industry Co., Limited 
                    ("Jucai
Coal
"),
                    a related company with common owner
114
268
Other
                    payable to an owner, Zhao Yao
186
197
The
          balances are unsecured, interest-free and there are no fixed terms for
          repayment.
The
          amount payable to Zhao Yao represents land use right paid by him on behalf
          of
          the Company (see Note 8).
In
          2001,
          the Company entered into agreements with Puda Group to lease an office
          and
          certain equipment. In the years ended December 31, 2003 and 2004, rental
          expenses payable to Puda Group were US$24,000 and US$24,000, respectively,
          which
          were charged to cost of revenue and general and administrative expenses
          in the
          statements of operations (see Note 11).
-11-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
5.
          Related Party Transactions (continued)
By
          an
          agreement entered into between the Company and Puda Group on April 25,
          2005,
          Puda Group agreed to pay all the tax liabilities (including surcharges
          and
          penalties) of the Company with retrospective effect from its establishment
          to
          December 31, 2004. As at December 31, 2003 and 2004, the Company has paid
          US$2,800,000 and US$5,768,000, respectively, to Puda Group for payment
          of income
          taxes and value-added tax ("VAT"). In December 2004, Puda Group paid the
          Company's income taxes of US$1,678,000 and VAT of US$1,950,000 to the China Tax
          Bureau. In April 2005, Puda Group paid the Company's VAT of US$251,000 to the
          China Tax Bureau. The directors expect that the Company's income tax for the
          year 2004 will be paid to the China Tax Bureau in July 2005 (see Note
          10).
In
          2001,
          the Company entered into an agreement with Jucai
Coal
to lease a coal washing plant. In the years ended December 31, 2003
          and
          2004, rental expenses in the amounts of US$604,000 and US$604,000, respectively,
          were paid to Jucai Coal and these rental expenses were charged to
          cost of
          revenue in the statements of operations (see Note 11).
In
          the
          years ended December 31, 2003 and 2004, the Company purchased raw coal
          from
          Jucai Coal in the amounts of US$1,434,000 and US$1,556,000,
          respectively.
6.
          Inventories
As
          of
          December 31, 2003 and 2004, inventories consist of the following:
December
                    31,
2003
2004
US$'000
US$'000
Raw
                    materials
776
2,557
Finished
                    goods
2,809
1,008
Total
3,585
3,565
There
          was
          no allowance for losses on inventories as of December 31, 2003 and
          2004.
-12-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
7.
          Property, Plant and Equipment, Net
As
          of
          December 31, 2003 and 2004, property, plant and equipment consist of
          following:
December
                    31,
2003
2004
US$'000
US$'000
Cost
Buildings
                    and facility
427
427
Machinery
                    equipment
633
633
Motor
                    vehicles
254
254
Office
                    equipment and others
76
76
1,390
1,390
Accumulated
                    depreciation
Buildings
                    and facility
61
80
Machinery
                    equipment
160
221
Motor
                    vehicles
69
93
Office
                    equipment and others
15
22
305
416
Carrying
                    value
Buildings
                    and facility
366
347
Machinery
                    equipment
473
412
Motor
                    vehicles
185
161
Office
                    equipment and others
61
54
1,085
974
Depreciation
          expense for each of the years ended December 31, 2003 and 2004 was approximately
          US$111,000 and US$111,000, respectively. For 2004, the amount included
          in cost
          of sales and general and administrative expenses was approximately US$86,000
          (2003: US$86,000) and US$25,000 (2003: US$25,000), respectively.
-13-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
8.
          Intangible Assets
Land
                    use right
December
                    31,
2003
2004
US$'000
US$'000
Cost
197
197
Accumulated
                    amortization
11
15
Carrying
                    value
186
182
Land
          use
          right is located in Shanxi, PRC and is amortized over 50 years up to March
          2051
          (see Note 5).
Amortization
          expense for the years ended December 31, 2003 and 2004 was approximately
          US$4,000 and US$3,000, respectively. The estimated aggregate amortization
          expense for the five years ending December 31, 2005, 2006, 2007, 2008 and
          2009
          amounts to approximately US$4,000, US$4,000, US$4,000, US$4,000 and US$4,000,
          respectively.
9.
          Notes Payable
Notes
          payable as of December 31, 2003 were unsecured. For the year ended December
          31,
          2003, all payments were made on a timely basis and no interest was assessed.
          As
          of December 31, 2004, there were no notes payable.
10.
          Income and Other Taxes Payable
By
          an
          agreement entered into between the Company and Puda Group on April 25,
          2005,
          Puda Group agreed to pay all the tax liabilities (including surcharges
          and
penalties
)
          on behalf of the Company with retrospective effect from its establishment
          to
          December 31, 2004. The Company has advanced funds to Puda Group for payment
          of
          income tax and VAT (see Note 5).
-14-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
11.
          Commitments and Contingencies
As
          of
          December 2003 and 2004, the Company leased equipment, plant and office
          premises
          under several operating lease agreements expiring in 2005, 2006 and 2008,
          respectively (see Note 5).
The
          future minimum lease payments under the above-mentioned leases as of December
          31, 2003 and 2004 are as follows:-
December
                    31, 2004
Year
US$'000
2005
628
2006
560
2007
6
2008
6
1,200
The
          above
          future lease payments include amounts payable to Puda Group and Jucai Coal.
          The
          amounts payable to Puda Group for the years ending December 31, 2005, 2006
          2007
          and 2008 are US$24,000, US$6,000, US$6,000 and US$6,000, respectively.
          The
          amounts payable to Jucai Coal for the years ending December 31, 2005, 2006,
          2007
          and 2008 are US$604,000, US$554,000, US$nil and US$nil,
          respectively.
As
          of
          December 2003 and 2004, the
Company
          did not have any contingent liabilities.
12.
          Profit Appropriation
In
          accordance with PRC regulations, the Company is required to make appropriations
          to the statutory surplus reserve fund, based on after-tax net income determined
          in accordance with PRC GAAP. According to the Memorandum and Articles of
          Association of the Company, appropriation to the statutory surplus reserve
          fund
          should be at least 10% of the after-tax net income determined in accordance
          with
          the PRC GAAP until the reserve fund is equal to 50% of the entity's registered
          capital. Appropriations to the statutory public welfare fund should be
          at least
          5% of the after-tax net income determined in accordance with the PRC GAAP.
          Statutory surplus reserve is established for the purpose of remedying the
          Company's losses, expanding operations, or increasing registered capital, and is
          non-distributable other than in liquidation.
-15-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
13.
          Other Operating Expenses
These
          represent mainly charges incurred for a potential public listing in the
          United
          States of America.
14.
          Taxation
Pursuant
          to the PRC Income Tax Laws, the Company is subject to enterprise income
          tax at a
          statutory rate of 33% (30% national income tax plus 3% local income tax).
Details
          of income taxes in the statements of operations are as follows:-
December
                    31,
2003
2004
US$'000
US$'000
Current
                    year provision
1,234
1,866
A
          reconciliation between taxes computed at the statutory rate of 33% and
          the
          Company's effective tax rate is as follows:-
December
                    31,
2003
2004
US$'000
US$'000
Income
                    before income taxes
3,636
5,559
Income
                    tax on pretax income at statutory rate of 33%
1,200
1,834
Effect
                    of permanent differences
34
32
Income
                    tax at effective rate
1,234
1,866
-16-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
15.
          Concentrations and Credit Risk
The
          Company operates principally in the PRC and grants credit to its customers
          in
          this geographic region. Although the PRC is economically stable, it is
          always
          possible that unanticipated events in foreign countries could disrupt the
          Company's operations.
At
          December 31, 2004, the Company has a credit risk exposure of uninsured
          cash in
          banks of approximately US$313,000. The Company does not require collateral
          or
          other securities to support financial instruments that are subject to credit
          risk.
The
          net
          sales to customers representing at least 10% of net total sales are as
          follows:-
December
                    31,
Customers
2003
2004
US$'000
%
US$'000
%
Customer
                    A
2,116
16
2,056
10
Customer
                    B
1,677
13
--
--
Customer
                    C
1,521
11
2,664
13
Customer
                    D
1,518
11
--
--
Customer
                    E
1,422
11
--
--
Customer
                    F
1,296
10
--
--
Customer
                    G
--
--
2,923
15
The
          following customers had balances greater than 10% of the total accounts
          receivable as of December 31, 2003 and 2004, respectively:
December
                    31,
Customers
2003
2004
US$'000
%
US$'000
%
Customer
                    F
477
20
--
--
Customer
                    H
381
16
--
--
Customer
                    B
362
15
--
--
Customer
                    C
262
11
451
16
Customer
                    I
250
11
--
--
Customer
                    E
--
--
327
12
Customer
                    J
--
--
323
12
-17-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
16.
          Retirement Benefits
The
          full-time employees of the Company are entitled to staff welfare benefits
          including medical care, casualty, housing benefits, education benefits,
          unemployment insurance and pension benefits through a Chinese
          government-mandated multi-employer defined contribution plan. The Company
          is
          required to accrue the employer-portion for these benefits based on certain
          percentages of the employees' salaries. The total provision for such employee
          benefits was US$63,000 and US$73,000 for the year ended December 31, 2003
          and
          2004, respectively and were recorded as accrued expenses. As of December
          31,
          2003 and 2004, the total amount included in accrued expenses for the provision
          is US$175,000 and $US$248,000, respectively. The Company is required to
          make
          contributions to the plans out of the amounts accrued for all staff welfare
          benefits except for education benefits. The contributions have not yet
          been made
          to the government social welfare organization for the year ended December
          31,
          2003 and 2004, respectively. The PRC government is responsible for the
          staff
          welfare benefits including medical care, casualty, housing benefits,
          unemployment insurance and pension benefits to be paid to these employees.
          The
          Company is responsible for the education benefits to be paid.
In
          the
          EITF Consensus 92-13, The Emerging Issues Task Force ("EITF") provides guidance
          regarding accounting for estimated payments in connection with the Coal
          industry
          Retiree Health Benefit Act of 1992, which requires enterprises that have
          ongoing
          operations in the coal industry to account for their obligations under
          the Act
          as either participation in a multi-employer plan or as a liability. The
          Company
          is only required to comply with the aforementioned separate contribution
          plan
          according to local statutory requirements regarding retiree health benefits,
          accordingly, the Consensus does not have impact on the Company's financial
          statements presented.
17.
Black
          Lung Benefits
In
          the
          United States of America, companies are responsible under the Federal Coal
          Mine
          Health and Safety Act of 1969, as amended, and various states' statutes for the
          payment of medical and disability benefits to employees and their dependents
          resulting from occurrences of coal worker's pneumoconiosis disease (black lung).
          In the PRC, besides a uniform contribution plan described in note 12, there
          is
          no such special Act or regulatory requirements to cover occurrences of
          coal
          worker's black lung. The Company provides no provision for its workers' black
          lung benefits inasmuch as the aforesaid Act does not apply to the
          Company.
-18-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
18.
          New Accounting Pronouncements
In
          January 2003, the Financial Accounting Standards Board ("FASB") issued
          interpretation No. 46 "Consolidation of Variable Interest Entities, an
          Interpretation of ARB No. 51" ("FIN 46"). FIN 46 clarifies when a company should
          consolidate in its financial statements the assets, liabilities and activities
          of a variable interest entity. FIN 46 provides general guidance as to the
          definition of a variable interest entity and requires a variable interest
          entity
          to be consolidated if a company absorbs the majority of the variable interest
          entity's expected losses, or is entitled to receive majority of the variable
          interest entity's residual returns, or both. In December 2003, the FASB issued a
          revised interpretation of FIN 46 ("FIN 46-R"), which supersedes FIN 46 and
          clarifies and expands current accounting guidance for variable interest
          entities. Both interpretations are effective immediately for any variable
          interest entity created subsequent to January 31, 2003, and for variable
          interest entities created before February 1, 2003, no later than the end
          of the
          first reporting period after March 15, 2004. The adoption of FIN 46-R has
          no
          impact on the Company's financial statements.
In
          April
          2003, the FASB issued SFAS No. 149, "Amendment of Statement 133 on Derivative
          Instruments and Hedging Activities", which clarifies financial accounting
          and
          reporting for derivative instruments, including certain derivative instruments
          embedded in other contracts and for hedging activities under SFAS No. 133,
          "Accounting for Derivative Instruments and Hedging Activities." SFAS No.
          149 is
          effective for contracts entered into or modified after June 30, 2003 and
          for
          hedging relationships designated after June 30, 2003. The adoption of SFAS
          No.
          149 has no impact on the Company's financial reporting and
          disclosures.
In
          May
          2003, the FASB issued SFAS No. 150 "Accounting for Certain Financial Instruments
          with Characteristics of Both Liabilities and Equity" ("SFAS No. 150"). SFAS No.
          150 revises the accounting for certain financial instruments that previously
          could be classified as liabilities (or, in some circumstances, assets)
          in the
          statement of financial condition. SFAS No. 150 also requires disclosure
          of the
          terms of those instruments and settlement alternatives. SFAS No. 150 generally
          is effective for all financial instruments entered into or modified after
          May
          31, 2003, and is otherwise effective at the beginning of the first interim
          period beginning after June 15, 2003. The adoption of SFAS No. 150 has
          no impact
          on the Company's financial statements.
In
          December 2003, the FASB issued SFAS No. 132R "Employers' Disclosures about
          Pensions and Other Postretirement Benefits" ("SFAS No. 132R"). This Statement
          revises disclosures by employers about pensions and other postretirement
          benefits. The additional disclosures are about the asset, obligations,
          cash
          flows and net periodic benefit cost of defined benefit pension plans and
          other
          defined benefit postretirement plans. The required information must be
          provided
          separately for pension plans and other postretirement benefit plans. New
          disclosures for interim periods beginning after December 15, 2003 are also
          required by SFAS No. 132R. The adoption of SFAS No. 132R has no impact
          on the
          Company's financial statements.
-19-
SHANXI
          PUDA RESOURCES CO., LTD.
NOTES
          TO FINANCIAL STATEMENTS (continued)
18.
          New Accounting Pronouncements (continued)
In
          December 2003, the staff of the Securities and Exchange Commission ("SEC")
          issued Staff Accounting Bulletin ("SAB") No. 104, "Revenue Recognition, which
          supersedes SAB 101, "Revenue Recognition in Financial Statements." The primary
          purpose of SAB 104 is to rescind the accounting guidance included in SAB
          101
          about multiple element revenue arrangements. SAB 104 also revises the SEC's
"Revenue Recognition in Financial Statements Frequently Asked Questions
          and
          Answers that have been codified in Topic 13. SAB 104 was effective immediately
          upon issuance and did not have a material impact of the Company's financial
          reporting and disclosures.
The
          FASB
          has issued SFAS No. 148 "Accounting for Stock-Based Compensation - Transition
          and Disclosures". SFAS No. 148 amends SFAS No. 123, "Accounting for Stock-Based
          Compensation", to provide alternative methods of transition for a voluntary
          change to the fair value based method of accounting for stock-based employee
          compensation. In addition, SFAS No. 148 amends the disclosure requirements
          of
          SFAS No. 123 to require prominent disclosures in both annual and interim
          financial statements about the method of accounting for stock-based employee
          compensation and the effect of the method used on reported results. The
          Company
          has adopted the disclosure requirements of SFAS No. 148. The Company has
          no
          stock-based compensation.
In
          December 2004, the FASB issued SFAS No. 123R, "Share-Based Payment, an
          Amendment
          of SFAS No. 123." SFAS No. 123R requires companies to recognize in the
          statement
          of operations the grant-date fair value of stock options and other equity-based
          compensation issued to employees. The Company has no stock-based
          compensation.
In
          December 2004, the FASB issued SFAS No. 153, "Exchanges of Non-monetary
          Assets."
          The Statement is an amendment of APB Opinion No. 29. SFAS No. 153 eliminates
          the
          exception for non-monetary exchanges of similar productive assets and replaces
          it with a general exception for exchanges of non-monetary assets that do
          not
          have commercial substance. The adoption of SFAS No. 153 has no impact on
          the
          Company's financial statements.
-20-
(b)
Pro
                  forma financial information
.
The
                  Unaudited Pro Forma Financial Statements of Puda, Puda BVI and
                  Putai as of
                  December 31, 2004, and for the period ended December 31, 2004 will
                  be
                  included in an amendment to this Current Report on Form 8-K which
                  Purezza
                  anticipates filing within the time period provided by this
                  form.
The
                  Unaudited Pro Forma Financial Statements of Purezza, Puda, Puda
                  BVI and
                  Putai as of December 31, 2004, and for the period ended December
                  31, 2004
                  will be included in an amendment to this Current Report on Form
                  8-K which
                  Purezza anticipates filing within the time period provided by this
                  form.
-31-
(c)
Exhibits
.
4.1
Certificate
                  of Designations, Preferences, Rights and Limitations of Series
                  A
                  Convertible Preferred Stock of Purezza Filed June 24,
                  2005
10.1
Technology
                  License Agreement dated June 24, 2005 between Puda and Putai
10.2
Operating
                  Agreement dated June 24, 2005 between Puda, Putai, Zhao Ming and
                  Zhao Yao
10.3
Exclusive
                  Consulting Agreement dated June 24, 2005 between Puda and Putai
10.4
Exclusive
                  Option Agreement dated June 24, 2005 between Puda, Putai, Zhao
                  Ming and
                  Zhao Yao
10.5
Authorization
                  dated June 24, 2005 between Puda, Putai and Zhao Ming
10.6
Authorization
                  dated June 24, 2005 between Puda, Putai and Zhao Yao
10.7
Financial
                  Advisory Agreement dated June 29, 2005, between Purezza and Keating
                  Securities, LLC.
99.1
Press
                  Release announcing the Closing filed on July
                  18, 2005.
-32-
SIGNATURES
Pursuant
        to the requirements of the Securities Exchange Act of 1934, Purezza Group,
        Inc.
        has duly caused this report to be signed on its behalf by the undersigned
        hereunto duly authorized.
PUREZZA
                  GROUP, INC.
Date: July
                  18, 2005
By:
/s/ Zhao
                  Ming
Zhao
                    Ming, Chairman
Chief Executive Officer and
                    President
-33-
EXHIBIT
        INDEX
Exhibit Number
Description of
                  Exhibit
4.1
Certificate
                    of Designations, Preferences, Rights and Limitations of Series
                    A
                    Convertible Preferred Stock of Purezza Filed June 24,
                    2005
10.1
Technology
                  License Agreement dated June 24, 2005 between Puda and Putai
10.2
Operating
                  Agreement dated June 24, 2005 between Puda, Putai, Zhao Ming and
                  Zhao Yao
10.3
Exclusive
                  Consulting Agreement dated June 24, 2005 between Puda and Putai
10.4
Exclusive
                  Option Agreement dated June 24, 2005 between Puda, Putai, Zhao
                  Ming and
                  Zhao Yao
10.5
Authorization
                  dated June 24, 2005 between Puda, Putai and Zhao Ming
10.6
Authorization
                  dated June 24, 2005 between Puda, Putai and Zhao Yao
10.7
Financial
                  Advisory Agreement dated June 29, 2005, between Purezza and Keating
                  Securities, LLC.
99.1
Press
                  Release announcing the Closing filed on July 18,
                  2005.
-34-