8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 8-K

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CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NO.: 1-08397

Date of Report: January 15, 2010

CHINA SXAN BIOTECH, INC.

(Exact name of registrant as specified in its charter)

Nevada	95-4755369
(State of Other Jurisdiction of incorporation or organization)	(I.R.S. Employer I.D. No.)

49 Fuxingmennei Street, Suite 310, Beijing, P.R. China 100031

(Address of principal executive offices) (Zip Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the 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 under the Exchange Act (17 CFR 240.14a-12)

□  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))

Item 1.01                      Entry into a Material Definitive Agreement

Item 2.01                      Completion of Acquisition of Assets

Item 3.02                      Unregistered Sale of Equity Securities

Item 5.01                      Changes in Control of Registrant

Item 5.02 Election of Director

On January 15, 2010 China SXAN Biotech acquired the outstanding capital stock of SNX Organic Fertilizers, Inc., a Delaware corporation (“SNX Organic”).  SNX Organic is a holding company that owns all of the registered capital of Beijing Shennongxing Technology Co., Ltd. (“Beijing Shennongxing”), a corporation organized under the laws of The People’s Republic of China.  Beijing Shennongxing is engaged in the business of manufacturing and marketing organic fertilizer.  All of Beijing Shennongxing’s business is currently in China.

The acquisition took place through a merger of SNX Organic into a wholly-owned subsidiary of China SXAN Biotech (the “Merger”).  In connection with the closing of the Merger, the following took place:

·   China SXAN Biotech issued to the shareholders of SNX Organic 40,000,000 shares of common stock and 3,600 shares of Series C Preferred Stock, which will be convertible into 360,000,000 shares of China SXAN Biotech common stock.

·   The Board of Directors of China SXAN Biotech elected Chen Yu, the Chief Executive Officer of Beijing Shennongxing, to serve as a member of the Board and as Chief Executive Officer and Chief Financial Officer of China SXAN Biotech.

·   The prior members of the Board of Directors of China SXAN Biotech submitted their resignations from the Board, which will be effective 10 days after China SXAN Biotech mails to its shareholders of record an information statement in compliance with Rule 14f-1 of the Securities and Exchange Commission.  Upon the effective date of their resignations, Chen Yu will be the sole member of the Board of Directors.

·   China SXAN Biotech assigned all of its pre-Merger business and assets to American SXAN Biotech, Inc., its wholly-owned subsidiary, and American SXAN Biotech assumed responsibility for all of the liabilities of China SXAN Biotech that existed prior to the Merger.

At the same time, China SXAN Biotech entered into an Assignment and Assumption and Management Agreement (the “Management Agreement”) with Feng Zhenxing, its previous CEO, Feng Guowu, a member of its Board, Yi Kang, a shareholder, and American SXAN Biotech.  The Management Agreement provides that Mr. Feng will manage American SXAN Biotech within his discretion, provided that his actions or inactions do not threaten material injury to China SXAN Biotech.  The Management Agreement further provides China SXAN Biotech, on the one hand, and Messrs Feng, Feng and Yi, on the other hand, mutual options to cause a sale of American SXAN Biotech, Inc. to Messrs. Feng, Feng and Yi in exchange for 6,600,000 shares of the common stock of China SXAN Biotech, Inc.

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New Management

Upon completion of the Merger, the Board of Directors consisted of Feng Zhenxing, Feng Guowu and Chen Yu.  Within the next few days, China SXAN Biotech will file with the Securities and Exchange Commission (“SEC”) and mail to its shareholders of record an information statement prepared in accordance with SEC Rule 14f-1, containing information about Chen Yu, among other things.  Ten days after the information statement is mailed to the shareholders of record, Feng Zhenxing and Feng Guowu will resign from their positions as members of the Board of Directors.  At that time, the executive officers and directors of Itlinkz Group will be:

Name	Age	Position with the Comapny	Director Since
Chen Yu	41	Chairman, Chief Executive Officer, Chief Financial Officer	2010

All directors hold office until the next annual meeting of our shareholders and until their successors have been elected and qualify.  Officers serve at the pleasure of the Board of Directors.

Chen Yu is an entrepreneur with nearly 20 years of experience in business management and operation.  Since June 2009, Mrs. Chen has served as the Chairman, CEO and CFO of Beijing Shennongxing Technology Co., Ltd.  Mrs. Chen started her business career as a manager at Hongkong Rongchang Trading Company from 1989 to 1994. From 1994 to 1996, Mrs. Chen was employed as vice president of Liaoning Zhongxing Group in Shanghai. From 1996 to 2006, Mrs. Chen was employed by American Mu’s Investment Group.  From 2006 until she joined Beijing Shennongxing, Mrs. Chen was one of directors and Chief Operations Officer of Shanghai William Jewelry Company. Mrs. Chen studied at the Shanghai Dance Schoolfrom 1982 to 1989, majoring in Ballet.  From 1994 to 1989, she attended the Shanghai University of Finance and Economics, studying corporate management.  During 1997 to 2000, Mrs. Chen studied Gemology in the United States, at the California Gemological Institute majoring in Gemologist.

Principal Shareholders

Upon completion of the Merger, there were 59,542,572 shares of China SXAN Biotech common stock issued and outstanding.  In addition, there are 153,442 shares of Series A Non-Voting Preferred Stock, each of which may be converted into one share of common stock.  There are also 3,600 shares of Series C Convertible Preferred Stock issued and outstanding, which can in total be converted into 360,000,000 common shares.  Therefore, the total outstanding common stock on a fully-diluted basis is 419,696,014 shares.  The holders of the Series C Preferred Stock have no voting power.

The following table sets forth information known to us with respect to the beneficial ownership of our common stock (assuming conversion of the Series A and the Series C Convertible Preferred Stock) as of the date of completion of the Merger by the following:

·   each shareholder who will beneficially more than 5% of our common stock (on a fully-diluted basis);

·   Chen Yu, our Chief Executive Officer

·   each of the members of the Board of Directors; and

·   all of our officers and directors as a group.

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Name and Address of Beneficial Owner(1)	Amount and Nature of Beneficial Ownership(2)	Percentage of Class
Chen Yu	20,000,000	4.8%
Feng Zhenxing(3)	14,400,000	3.4%
Feng Guowu(3)	800,000	0.2%
All directors and officers, as a group (3 persons)	35,200,000	8.4%
Huakang Zhou, 18 Quail Run, Warren, NJ 07075	89,500,000(4)	21.3%
Ying Wang	80,000,000	19.1%
Yuting Yan	25,000,000	6.0%

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(1)           Except as otherwise noted, the address of each shareholder is c/o Beijing Shennongxing Technology Co., Ltd., 49 Fuxingmennei Street, Suite 310, Beijing, P.R. China 100031

(2)           Except as otherwise noted, all shares are owned of record and beneficially.

(3) The address for Messrs Feng and Feng is Three-Kilometer Spot Along the Hayi Highway, Tieli City, Heilongjiang Province, P.R. China

(4) Includes 40,000,000 shares owned by Warner Technology & Investment, Inc., which is controlled by Mr. Zhou.

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INFORMATION REGARDING THE ACQUIRED COMPANIES

Business

SNX Organic Fertilizers, Inc.

SNX Organic Fertilizers, Inc. was organized under the laws of the State of Delaware in 2005.  It never initiated any business activity.  In March 2006 SNX Organic acquired 100% of the registered capital stock of Beijing Shennongxing in exchange for equity in SNX Organic.  Those shares represent the only asset of SNX Organic.

Beijing Shennongxing Technology Co., Ltd.

Beijing Shennongxing was organized in 2002 under the laws of the People’s Republic of China.  In 2005 the Company amended its charter to adopt its current corporate name and increased its registered capital to 1,000,000 RMB ($146,413).  From inception, Beijing Shennongxing has engaged in the business of manufacturing and marketing organic fertilizer. Currently Beijing Shennongxing operates through two wholly-owned subsidiaries:

·   Daqing Shennongxing Xiangyu Technology Co., Ltd. (“Daqing Shennongxing”). Beijing Shennongxing invested $239,670 to establish Daqing Shennongxing in Daqing City, Heilongjiang Province.  Daqing Shennongxing specializes in manufacturing complex mixing fertilizer and organic fertilizer, and in developing and marketing microbial fertilizer.

·   Heilongjiang Xiangyu Organic Fertilizer Co., Ltd. (“Heilongjiang Xiangyu”).  Heilongjiang Xiangyu was established in Jiamusi City, Heilongjiang Province in September 2006, with registered capital of $762,467. It specialized in manufacturing compound fertilizer and organic fertilizer under the “Xiangyu” brand, which was developed by a state-owned enterprise and carries considerable goodwill in the agricultural markets of northeast China.

To date we have focused our attention on research and development of our product line.  For that reason our revenues have been modest.  Our products are now ready for full scale marketing, and it is out plan to promote our product in more districts around China, and to set up additional manufacture bases in central China and southern China. Implementation of that plan will require capital, however.  So our focus in the coming months will be on obtaining the working capital that will enable us to take advantage of the market opportunities available to our company.

The Market for Organic Fertilizer in China

The market for fertilizer in a region depends, in the first instance, on the fertility of the regional soil.  By nature, and by reason of poor agricultural practices in the 20th Century, the soil in China is, overall, less fertile than in most other countries.  Studies indicate that effective agricultural production in China requires that the farmer use twice as much fertilizer as is the norm in Japan, 2.4 times the norm in the United States, 4.4 times the norm in Canada, and 8.2 times the norm in Australia.

 According to Ministry of Agriculture of China, there are more than 2 billion acres of cultivated land in Chine, which require approximately 140 million tons of fertilizer per year. The Chinese National Agricultural Means of Production Circulation Association has estimated that in 2008 Chinese fertilizer consumption accounted for 38% of total world-wide fertilizer usage.  China’s production of fertilizer, however, falls far short of the demand, with the result that China’s fertilizer supply is still dependent on imports.  Since fertilizer is a bulky and volatile product, difficult to ship, the lack of an adequate domestic supply of fertilizer forces farmers to pay prices for imported fertilizer that are swelled by shipping charges.  This situation creates a significant market opportunity for a domestic supplier of quality fertilizer.

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                There are about 500 factories and related companies involved in the commercial manufacture of fertilizer in China.  These 500 companies could be categorized into three different market segments in term of product:

·   Refined organic-based fertilizer, mainly focus on providing agricultural crops with organic nutrition and replenishing micronutrients which cannot be sufficiently obtained from soil. The companies that are involved in manufacturing such products account for about 31% of Chinese fertilizer companies.

·   Compound fertilizer, which combines both organic-based fertilizer and inorganic fertilizer.  These companies account for about 58% of Chinese fertilizer companies.

·   Bio-organic based fertilizer, which is able to improve soil condition and suppress crop disease, while providing crops with high quality organic nutrition. These companies account for about 11% of Chinese fertilizer companies.

The third category, which includes Beijing Shennongxing, is the fastest growing segment of the fertilizer industry in China.  Although bio-organic products still represent only a small share of the fertilizer market in China, as public awareness of the relationship between green products and a healthy life style is emerging, demand for organic products is growing. In addition, recognition has grown regarding the detrimental ecological effect of the intense use of chemical fertilizer, as well as the damage to agricultural soil caused by inorganic fertilizer.  Increased use of chemical fertilizer in Chinese agriculture has reduced the soil's ability to absorb nitrogen and other nutrients. Applying organic or compound fertilizer helps to restore the soil by replenishing these micronutrients.  These two factors have prompted several small and regional companies to produce organic, environment-friendly fertilizer. Organic fertilizer comprises a balance of both organic and biotechnology substances, thereby combining the speedy effectiveness of biotech fertilizers with the environmental benefits of the organic ones, thus ensuring significant room for its future development in the Chinese agricultural production system.

Our Products

During the past several years we have developed or acquired the technology necessary a variety of fertilizer products, including high quality organic fertilizer, active organic compound fertilizer, organic foliage fertilizer product, and organic-based fertilizer processed from biodegradable waste. In addition to the high fermentation technology that we imported from the U.S., we are also working closely with Chinese Academy of Agricultural Sciences and China Agricultural University and other experts in an effort to maximize the utility of the technology we imported from overseas.  In the coming years we plan to apply for patents covering our state-of-the-art fertilizer manufacturing technology.

Our core product is “Xiangyu” brand bio-organic fertilizer and compound fertilizer. Our Xiangyu bio-organic fertilizer is produced from a variety of high quality organic materials, including fully fermented stock manure, grass peat, and humic acid. The mixture of those organic materials, combined with several other components, is processed through a series of procedures consisted of stirring, chopping, powder making, dry, cooling off, filtering and packaging.

Organic fertilizers are composed of natural nutritional elements that improve the quality and yield of crops while also improving soil quality, which in turn improves crop yield.  Organic compound fertilizer accelerates reproduction of soil microbes to improve soil quality through the decomposition of organic material and the improvement of the soil’s retention of nitrogen. Moreover, this application can activate dormant soil by increasing soil nitrates and moisture content, a benefit not achieved by traditional chemical fertilizers. This process controls the release of nutritional elements that enhance the quality, quantity and health of crops. For example, in our tests comparing mandarin orange production using our bio-organic fertilizer with production using chemical fertilizer, the oranges that were bio-organically fertilized had 8% more sugar content, an increase of 5mg/100g in Vitamin C content and significantly smoother skin.  So, given that organic compound fertilizers typically are less expensive or equal in price to chemical fertilizers, we believe that educated farmers will recognize that use of organic fertilizer provides economic advantages due to the increase of yield and quality and, consequently, the increased margin attained by the farmer at the market.

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Plants tend to easily absorb organic fertilizer without many of the side effects found in the use of chemical fertilizer.  This organic process strengthens photosynthesis, which improves the overall health of a plant in resisting drought and disease. Additional functions of organic compound fertilizer include:

preserving nitrogen and improving soil fertility;

allowing phosphorus and potash fertilizer to gradually dissolve;

promoting disease resistance; and

activating and maintaining soil moisture content.

Our products can be applied to all kinds of crops, but have particular advantages for crops that will benefit from an advanced blooming and fruiting period.  We have tested our products in numerous field trials, in comparison with chemical fertilizer, with application to more than a dozen crops.  Our tests resulted, on average, in a 10% - 30% increase in the net value of the farmer's crop, depending on the particular crop and the product application. The increased value is due, in part, to the increased effectiveness of nitrogen which is catalyzed by the product.  In addition, the disease suppression characteristics of our fertilizer reduced the need for other costly crop protection applications. Our testing indicated that our fertilizers provide the following benefits:

·   Stimulate seed germination and viability, root respiration, formation and growth.

·   Produce thicker, greener, and healthier foliage.

·   Produce more, larger, longer lasting flowers.

·   Increase significantly the protein, vitamin, and mineral contents of most fruits and vegetables.

·   Reduce fertilizer requirements and increase yields in most crops.

·   Suppress crop disease.

In February 2007, Beijing Shennongxing’s methods of manufacturing active organic compound fertilizer and organic foliage fertilizer were certified as compliant with the standards of China’s Quality Management System Certification, ISO9001:2000.

Trademarks and Intellectual Property

In 1999 the China Green Product Development Center awarded to the XiangYu Fertilizer Company, a state-owned enterprise of Huanan County, its certification that fertilizer sold under the brand “XiangYu” qualified as a Grade A Green Food Raw Material, making XiangYu the first Grade A green brand in Province of Heilongjiang. To achieve that certification, the company’s production environment had to satisfy environmental quality standards established by the National Administration of Agricultural Quality, Supervision, Inspection and Quality.  The certification meant that food manufacturing companies using food products fertilized with XiangYu brand fertilizer are eligible to put the “Green Food” label on their products. In the following years, the XiangYu brand developed into one of the best known fertilizer brands in northeast China, including Provinces of Liaoning, Jilin and Heilongjiang.  In 2008 “XiangYu” was presented the “Brand Name” award at the Heilongjiang China Agricultural Exposition.

Despite the value of its brand, the XiangYu Fertilizer Company failed as a business.  In 2006, therefore, we signed a management agreement with the government of Huanan County and paid $265,492 to obtain an exclusive license to use the XiangYu brand name as well as the plant, equipment and intangible assets of the XiangYu Fertilizer Company for 20 years.  Currently, we market our products under the XiangYu brand.  In the near future, we also plan on acquiring another famous fertilizer brand, “Zheng Guang,” which is influential in central China.  We are looking to take advantage of these name brands to expand and improve public awareness of our own organic-based fertilizer products.

We currently own and employ one patented technology in our fertilizer production.  In 2003 the Government of China awarded us patent number 01138982 for “bio-based organic fertilizer manufacturing technology.”  Beijing Shennongxing also owns two patents for seed magnetization technology that it acquired by license from Huanan County; however, it has no current use for that technology.  We intend to file additional patent applications in the future.

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Production and Facilities

The Company’s plant in Jiamusi City has a fertilizer output capacity of 5,000 tons per year.  Our plant in Daqing also has a fertilizer output capacity of 5,000 tons per year as well. We currently have one “scarab” fertilizer manufacturer, as well as the other necessary equipment for production, including a windrow turner machine, customized rotary drum screening system, farmland thermometer, farmland moisture measure, and PH screen appliance.  Most of our equipment was introduced from North America.

For the six months end September 30, 2009, the combined actual output of the Company was 4000 tons, due to the low level of our marketing operations.  As we obtain capital to fund our operations, we will seek to expand to our plant capacity.  In addition, in order to reduce shipping expense, our plan is to develop local manufacturing facilities in additional regions of China, thereby providing local delivery capabilities and increased capacity.

Raw Material and Suppliers

A variety of raw materials are utilized in the production of our products,  including fermented chicken manure, fermented rice straw, grass peat, carbamide, monoammonium, ammonium acid carbonate, humic acid, potassium, and potassium chloride. We obtain these raw materials for organic compound fertilizers from many different suppliers in the People’s Republic of China. To manufacture our organic fertilizer, fermented chicken manure, fermented rice straw, grass peat and extracted humic acid are the key raw materials. We currently maintain short-term (typically one-year) supply contracts with 10 material suppliers, 4 of whom are considered “key” suppliers. We utilize spectral analysis technology to select the raw material with the best quality, and we have specially trained buyers to make sure the quality and consistency of the raw materials are maintained.

In addition to the major raw materials, we also utilize a few different components in our production process, all of which can be readily obtained from numerous sources in local markets. Management believes that there are adequate alternative sources of supply for each of these raw materials.

Marketing and Distribution

We have a marketing team of 12 employees. Their pre-market mission is to collect and correlate marketing data from across 5 provinces and 2 municipalities. Our goal is to assemble nationwide market analyses, ascertain new product needs, estimate demand and customer demographics and develop new products to meet that demand.  We then apply our branding strategy - identifying our products by brands known in the local region - to introduce to the market the products most likely to appeal to the farmers in that region.  For example, in northwest China, climate and environment cause farmers to realize low profit margins, which limit their financial ability to invest in fertilizer.  In that area, therefore, we market a broader spectrum, low-cost fertilizer.

Currently the majority of our marketing efforts involve television advertisements and other mass media. In addition, we also conduct marketing and advertising programs through joint events with our customers. Our sales staff shares its knowledge base by organizing training courses about agricultural techniques that are offered to the public on a regular basis, as well as lectures and interactive meetings. Our staff emphasizes the technological components of our products to help end users understand the differences in products available and how to use them. Also, we have set up several hotlines to answer customer questions and to have real-time interaction with customers.

Currently we sell our products through direct selling methods.  However, we are actively developing county level product representatives to represent and market our products throughout the provinces contiguous to Heilongjiang:  Liaoning, Shandong, Neimenggu and Hebei. The Company will employ a target-profit pricing method. The headquarters in Beijing will determine the target profits for each of the two manufacturing plants, which in turn will work directly with general distributors to determine the prices of each of the product series sold into the local distribution channel.

Because of our low level of sales at this time, a small number of customers provide the largest portion of our sales.  Our major customers are farms and plantations, including four from Beijing, three from Shandong and three from Hebei.  Approximately 25% of our sales are made to farmers who are certified as “organic.”  The majority of our sales are to non-organic growers who are attracted by the productivity advantages offered by our products.

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Currently Beijing Shennonxing ships its fertilizer in bagged lots.  Its automatic filling and packaging line has a capacity of 500kg/hour.  Beijing Shennongxing uses outsourced trucks as the primary method of making shipments from the manufacturing facility to the customer.  In special circumstances, rail delivery will also be available.  Because transportation of fertilizer entails a risk of environmental pollution, Beijing Shennongxing has developed special transportation and storage containers for use in distribution of its products.

Within the Company’s agricultural markets, a significant portion of the required sales effort includes providing customers with follow-up analysis regarding the efficacy of the Company’s products.  Beijing Shennongxing’s future growth will depend upon the Company being able to provide this type of benefit analysis to its customers.  So we intend to increase the number of our staff capable of providing such information as a part of our marketing effort.

Competition

The organic fertilizer industry in the People’s Republic of China is largely fragmented, with most competitors operating small regional factories, serving local requirements. Most companies in this industry do not widely promote their products. They have competitive advantages, however, in that they are likely to have tailored their product offerings to local conditions.  We intend to do likewise.  We have not yet identified any competitors in the northeast China that operate in all of our product lines (organic compound fertilizer, liquid fertilizer, pesticides and insecticides). Our competitive position in the fertilizer industry is strengthened by our emphasis on the use of “environmentally friendly” fertilizer products.

Seasonality and Revenue Volatility

The fertilizer business is highly seasonal, since sales are tied to the planting, growing and harvesting cycles. The seasonality of the industry affects the sales volume of our product. Typically, we experience a higher sales volume in the second and third quarters, with a lower volume in the first and fourth quarters.

Our sales volume can be volatile as a result of a number of factors, including:

Weather patterns and field conditions (particularly during periods of high fertilizer consumption);

Quantities of fertilizers imported to primary markets;

Current and projected grain inventories and prices, which are heavily influenced by U.S. exports, worldwide grain markers, and domestic demand (food, feed, biofuel);

Government regulation, intervention and unexpected changes in government policies; and

The reputation of our products and company in the marketplace.

Environmental Regulation

Our products and our manufacturing practices are subject to regulation by governmental agencies in the People’s Republic of China. Business and company registrations, along with the products, are certified on a regular basis and must be in compliance with the laws and regulations of the People’s Republic of China and provincial and local governments and industry agencies, which are controlled and monitored through the issuance of licenses. We believe that we have complied with all registrations and requirements for the issuance and maintenance of the licenses required of us by the governing bodies. As of the date of this report, all of our operating license fees and filings are current.

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Employees

We currently have 69 full-time staff and employees, assigned to our internal departments as follows:

Department	Headcount
Management		7
Accounting staff		2
Sales and marketing staff		20
Product line staff		40
Total		69

Properties

The executive offices of Beijing Shennongxing are located in rented offices in Beijing.  The manufacturing facility of its subsidiary, Daqing Shennongxing, is located on a 3,685 m2 parcel of land in the National High Technology District in Daqing City, Heilongjiang.  The manufacturing facility of its other subsidiary, Heilongjiang Xiangyu, is located on a  3,198 m2 parcel in Jiamusi City, Heilongjiang.  The two facilities collectively have five warehouses, two for finished products and three for raw materials and work in process, plus an office builsing.

Management’s Discussion and Analysis

Results of Operations

Beijing Shennongxing remains in a pre-market stage of its operations.  During the past few years we have focused on developing our technology and product offering, then on establishing marketing channels, including developing access to agribusiness clients.  Sales have been incidental to these activities and, therefore, limited.  During the six months ended September 30, 2009 we recorded only $36,400 in revenue, all of which was earned in the quarter ended June 30, 2009.  During the year ended March 31, 2009 we recorded $117,414 in revenue.  These sales were made to a small number of farms and plantations, generally at cost, and primarily for the purpose of initiating distribution for testing purposes.  Primarily because the cost of goods sold recorded on our Statements of Operations includes an allocation of indirect production costs (such as utilities) and an allocation of indirect labor (such as assembly and packaging), in each period we realized negative gross margin:  a gross loss of $59,902 in the six months ended September 30, 2009 and a gross loss of $37,527 during the year ended March 31, 2009.

An additional reason for our negative margins has been recent increases in the cost of the specialized raw materials that we use in our fertilizer.  Specifically, the cost of carbamide, which serves as an important raw material for our products, increased by 20.6% to RMB 1750 per ton in 2009 from RMB 1450 per ton a year earlier. In addition, the costs of monoammonium, potassium, and potassium chloride have increased significantly during 2009.  Our prospects for profitable operations in the future will depend, in part, on how the international market for these raw materials develops in the next few years.  Similarly, because the cost of transportation represents a significant portion of our cost of goods sold, the international market for oil will also influence our profitability in future periods.

           As noted, all of our sales in the six months ended September 30, 2009 occurred during the quarter ended June 30, 2009.  Likewise, all but $1,537 of our sales during the year ended March 31, 2009 occurred during the three months ended June 30, 2008.  This high level of seasonality occurs because farmers customarily purchase their fertilizer in the early Spring.  As our business grows, one challenge facing us will be to develop methods of spreading our revenues into other quarters.

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           Our general and administrative expenses principally include:

●   Office staff salaries and benefits;

●   Traveling and entertainment expenses;

●   Other associated fees.

Our general and administrative expenses were $726,254 for the year ended March 31, 2009, and were relatively the same, $712,660, in the year ended March 31, 2008. During the six months ended September 30, 2009, however, general and administrative expenses fell to $133,127.  The reduction is primarily attributable to expenses incurred in the 2009 and 2008 fiscal years in connection with (a) product acquisition and development, and (b) efforts by the Company to become publicly listed in the United States.  General and administrative expenses are likely to increase in the near term due to the fact that SNX Organic is now a subsidiary of China SXAN Biotech, and will incur the expenses attendant to SEC reporting and to maintaining a public trading market for the Company’s shares.  In addition, if we are able to secure the funds needed to implement our marketing program, general and administrative expenses will grow along with the expansion of our business operations.  When funded, we intend to open new manufacturing facilities and hire additional personnel, all of which will increase our general and administrative expenses.

Due to the low level of our revenues, our operating expenses were approximately equal to our net loss in all of the periods reported on in this Report:  $194,644 for the six months ended September 30, 2009, $773,611 for the year ended March 31, 2009, and $726,651 for the year ended March 31, 2008.

Our business operates in Chinese Renminbi, but we report our results in our SEC filings in U.S. Dollars.  The conversion of our accounts from RMB to Dollars results in translation adjustments, which are reported as a middle step between net income and comprehensive income.  The net income is added to the retained earnings on our balance sheet; while the translation adjustment is added to a line item on our statement of stockholders equity labeled “accumulated other comprehensive income,” since it is more reflective of changes in the relative values of U.S. and Chinese currencies than of the success of our business.  During the six months ended September 30, 2009, the unrealized loss on foreign currency translations reduced our accumulated other comprehensive income by $59,837.

Liquidity and Capital Resource

Since Beijing Shennongxing was organized, its operations have been funded primarily by loans from our shareholders. As of September 30, 2009, therefore, the balance due to our shareholders was $1,716,047.  This is recorded on our balance sheet as a long-term liability, because the creditors are members of the management of Beijing Shennongxing, and they have committed that they will not seek repayment of the loan during the next fiscal year and not until the Company can afford to repay the loan without damage to its business prospects.

As of September 30, 2009, SNX had a working capital deficit of $396,724.  This represented an increase of $72,603 compared to the working capital deficit at March 31, 2009.  The increase in working capital deficit is less than the net loss for the six month period primarily because Beijing Shennongxing obtained $146,102 by disposing of unneeded fixed assets during the period.

During the year ended March 31, 2009 our working capital deficit increased by $301,374.  This was less than our net loss of the year of $773,611, primarily due to a contribution of $871,483 in cash made by the management of Beijing Shennongxing during the year.   

Included in our current assets at September 30, 2009 are “other account receivable” of $162,017.  The greater portion of this item represents funds advanced to middlemen for future purchases of raw materials.  The accounts will be amortized as raw materials are received.

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The largest item in our current liabilities is denoted “accrued expenses and other payable.”  As of September 30, 2009 this item totaled $1,090,772, representing an increase of $356,703 since March 31, 2009.  Included in this item is $941,400 related to the conversion of the facilities of the XiangYu Fertilizer Company for use in our operations.  The item includes amounts owed (but, in most cases, not yet payable) for services by contractors, and also includes refundable contract deposits and bidding deposits given to Beijing Shennongxing in connection with the construction process.

In order to fully implement our business plan, we will require working capital far in excess of our current asset value. Our expectation, therefore, is that we will seek to access the capital markets in both the U.S. and China to obtain the funds we require. At the present time, however, we do not have commitments of funds from any source.

           Off-Balance Sheet Arrangements

Neither SNX Organic nor Beijing Shennongxing has any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on their financial condition or results of operations.

Risk Factors That May Affect Future Results

You should carefully consider the risks described below before buying our common stock.  If any of the risks described below actually occurs, that event could cause the trading price of our common stock to decline, and you could lose all or part of your investment.

We will need to raise additional capital to fund our operations, and we do not have any commitments for that capital.

In order to operate our business at a cost effective level and achieve profits, we will need additional capital.  At present no one has committed to provide us the necessary capital.  If we are unsuccessful in raising additional capital, we will be unable to execute our business strategy, and are unlikely to be able to sustain operations. If we became unable to continue as a going concern, we would have to liquidate our assets and we might receive significantly less than the values at which they are carried on our consolidated financial statements.  In addition, if adequate capital cannot be obtained on satisfactory terms, we will be forced to curtail or delay the implementation of updates to our facilities and delay the expansion of our sales and marketing capabilities, any of which could cause our business to fail.
 

We have limited operating history, and our prospects are difficult to evaluate.

We have not operated any facility other than our two facilities in city of Daqing and city of Jiamusi, which we acquired in April 2009 and September 2009, and those have been operated only on a limited basis.  Our activities to date have been primarily limited to developing our products and establishing marketing relationships.  Consequently there is limited historical financial information related to operations available upon which you may base your evaluation of our business and prospects. The revenue and income potential of our business is unproven. If we are unable to develop our business, we will not achieve our goals and could suffer economic loss or collapse.
 

Our plan to develop relationships with strategic partners and vendors may not be successful.

Our business plan contemplates that we will have to develop both short- and long-term relationships with certain partners and material suppliers to conduct growth trials and other research and development activities, to assess technology, to engage in marketing activities, and to enter into waste collection. For these efforts to succeed, we must identify partners and material suppliers whose competencies complement ours. If we are unsuccessful in our collaborative efforts, our ability to develop and market products could be severely limited or delayed.

12

Our future success will be dependent on our existing key employees, and hiring and assimilating new key employees, and our inability to attract or retain key personnel in the future would materially harm our business and results of operations.

Our success depends on the continuing efforts and abilities of our current management team. In addition, our future success will depend, in part, on our ability to attract and retain highly skilled employees, including management, technical and sales personnel. The loss of services of any of our key personnel, the inability to attract or retain key personnel in the future, or delays in hiring required personnel could materially harm our business and results of operations. We may be unable to identify and attract highly qualified employees in the future. In addition, we may not be able to successfully assimilate these employees or hire qualified personnel to replace them.

We may be unable to establish marketing and sales capabilities necessary to commercialize and gain market acceptance for our potential products.

We currently have limited resources to expand our sales and marketing capabilities. We will need to either hire sales personnel with expertise in the markets we intend to address or contract with others to provide sales support. Co-promotion or other marketing arrangements to commercialize our planned products could significantly limit the revenues we derive from our products, and our associates may fail to commercialize these products successfully. Our planned products address different markets and can be offered through multiple sales channels. Addressing each market effectively will require sales and marketing resources tailored to the particular market and to the sales channels that we choose to employ, and we may not be able to develop such specialized marketing resources.
 

The fertilizer industry is highly competitive, which may adversely affect our ability to generate and grow sales.

Chemical fertilizers are manufactured by many companies and are plentiful and relatively inexpensive. In addition, the number of fertilizer products registered as “organic” with the China Food Development and Certification Center increased by approximately 26% from 2005 to 2008. If we fail to keep up with changes affecting the markets that we intend to serve, we will become less competitive, adversely affecting our financial performance.

Detection of any significant defects in our products or failure in our quality control procedures may result in, among other things, delay in time-to-market, loss of sales and market acceptance of our products, diversion of development resources, and injury to our reputation. The costs we may incur in correcting any product defects may be substantial. Additionally, errors, defects or other performance problems could result in financial or other damages to our customers, which could result in litigation. Product liability litigation, even if we prevail, would be time consuming and costly to defend.

Changes in environmental regulations or violations of such regulations could result in increased expense and could have a material negative effect on our financial performance.

We are subject to air, water and other environmental regulations and will need to obtain a number of environmental permits to construct and operate our planned facilities. If for any reason any of these permits are not granted, construction costs for our organic waste conversion facilities may increase, or the facilities may not be constructed at all. Additionally, any changes in environmental laws and regulations, either at the national or the provincial level, could require us to invest or spend considerable resources in order to comply with future environmental regulations. The expense of compliance could be significant enough to reduce our net income and have a material negative effect on our financial performance.

13

Risks of doing business in People’s Republic of China

The People’s Republic of China’s Economic Policies could affect our Business.

Virtually all of our assets are located, and all of our revenues are derived from our operations, in the People’s Republic of China. Accordingly, our business, financial condition and results of operations are subject, to a significant extent, to the economic, political and legal developments in the People’s Republic of China.

While the People’s Republic of China’s economy has experienced significant growth in the past twenty years, such growth has been uneven, both geographically and among various sectors of the economy. The Chinese government has implemented various measures to encourage economic growth and guide the allocation of resources. Some of these measures benefit the overall economy of the People’s Republic of China, but they may also have a negative effect on us. For example, operating results and financial condition may be adversely affected by the government control over capital investments or changes in tax regulations.

Over the past 20 years, the Chinese economy has experienced periods of rapid expansion and fluctuating rates of inflation. These factors have led to the adoption by the Chinese government, from time to time, of various corrective measures designed to restrict the availability of credit or regulate growth and contain inflation. High inflation may in the future cause the Chinese government to impose controls on credit and/or prices, or to take other action that could inhibit economic activity in China, and thereby harm the market for our products, which could have a negative effect on our business, financial condition and results of operations.

The economy of the People’s Republic of China has been changing from a planned economy to a more market-oriented economy. In recent years the Chinese government has implemented measures emphasizing the utilization of market forces for economic reform and the reduction of state ownership of productive assets, and the establishment of corporate governance in business enterprises.  However, a substantial portion of the productive assets in the People’s Republic of China are still owned by the Chinese government. In addition, the Chinese government continues to play a significant role in regulating industry development by imposing industrial policies. It also exercises significant control over the People’s Republic of China’s economic growth through the allocation of resources, the control of payment of foreign currency- denominated obligations, the setting of monetary policy and the provision of preferential treatment to particular industries or companies.

Capital outflow policies in the People’s Republic of China may hamper our ability to remit income to the United States.

The People’s Republic of China has adopted currency and capital transfer regulations. These regulations may require us to comply with complex regulations for the movement of capital. Although we believe that we are currently in compliance with these regulations, should these regulations or the interpretation of them by courts or regulatory agencies change; we may not be able to remit all income earned and proceeds received in connection with its operations or from the sale of its operating subsidiary to our stockholders.

We may have difficulty establishing adequate management, legal and financial controls in the People’s Republic of China.

The People’s Republic of China historically has not adopted a Western style of management and financial reporting concepts and practices, modern banking, computer or other control systems. We may have difficulty in hiring and retaining a sufficient number of qualified employees to work in the People’s Republic of China. As a result of these factors, we may experience difficulty in establishing management, legal and financial controls, collecting financial data and preparing financial statements, books of account and corporate records and instituting business practices that meet Western standards.

14

Description of Securities

China SXAN Biotech is authorized to issue:

Ø   100,000,000 shares of Common Stock, $.001 par value per share, of which 59,542,572 shares are outstanding;

Ø   3,600 shares of Series C Preferred Stock, all of which is outstanding; and

Ø   99,896,000 shares of Preferred Stock, none of which are outstanding.

In addition, China SXAN Biotech has contracted to issue 153,442 shares of Series A Non-Voting Convertible Preferred Stock.  However no certificate of designation for such shares was ever filed with the Nevada Secretary of State.  Accordingly, the individuals who subscribed for those shares hold contractual rights equivalent to the rights they would have possessed if duly authorized shares had been issued to them.

Common Stock.  Holders of the Common Stock are entitled to one vote for each share in the election of directors and in all other matters to be voted on by the stockholders.  There is no cumulative voting in the election of directors.  Holders of Common Stock are entitled to receive such dividends as may be declared from time to time by the Board of Directors with respect to the Common Stock out of funds legally available therefor and, in the event of liquidation, dissolution or winding up of the Company, to share rateably in all assets remaining after payment of liabilities.  The holders of Common Stock have no pre-emptive or conversion rights and are not subject to further calls or assessments.  There are no redemption or sinking fund provisions applicable to the Common Stock.

Series A Convertible Preferred Stock (contractual rights only).  The holder of each share of Series A Preferred Stock is entitled to convert the share into one share of Common Stock.  The holders of Series A Preferred Stock have no voting rights, no dividend rights, and no right to a distribution on liquidation.

Series C Convertible Preferred Stock.  The holder of each share of Series C Preferred Stock is entitled to convert the share into 100,000 shares of Common Stock.  The holders of Series C Preferred Stock have no voting rights.  In the event that the Company declares a dividend, the holders of the Series C Preferred Stock will participate in the dividend as if they held the number of common shares into which their Series C Preferred Stock is convertible.   In the event of a liquidation of the Company, the holders of the Series C Preferred Stock will be entitled to a distribution of $.01 per share, and then will participate in the remainder of the distribution as if they held the number of common shares into which their Series C Preferred Stock is convertible.   The Company may call the Series C Preferred Stock for redemption at a price of $.001 per share at any time after June 30, 2010 if there are sufficient authorized common shares to permit full conversion of the Series C Preferred Stock.

Preferred Stock.  The Board of Directors of China SXAN Biotech is authorized to designate the preferred stock in classes, and to determine the rights, privileges and limitations of the shares in each class.  No class of Preferred Stock may have voting rights.

15

Item 9.01                      Financial Statements and Exhibits

Financial Statements	Page
Unaudited consolidated financial statements of SNX Organic Fertilizers, Inc. for the six month periods ended September 30, 2009 and 2008	F-1
Audited financial statements of SNX Organic Fertilizers, Inc. for the years ended March 31, 2009 and 2008	F-12

Exhibits

3-a Certificate of Designation of Series C Preferred Stock

10-a Merger Agreement dated January 15, 2010 among China SXAN Biotech, Inc., SNX Acquisition Corp., and SNX Organic Fertilizers, Inc.

10-b Assignment and Assumption and Management Agreement dated January 15, 2010 among China SXAN Biotech, Inc., American SXAN Biotech, Inc., Feng Zhenxing, Feng Guowu and Yi Kang.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

January 15, 2010                                                                CHINA SXAN BIOTECH, INC.

By: /s/ Chen Yu

     Chen Yu, Chief Executive Officer

16 

Financial Statements

SNX ORGANIC FERTILIZER, INC.
CONDENSED CONSOLIDATED BALANCE STATEMENTS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2009 & 2008
	(UNAUDITED)
ASSETS

	September 30,		March 31,
	2009		2009
	(Unaudited)		(Audited)
Current Assets:
Cash and cash equivalents	$	276,912	$	14,504
Accounts receivable, net		226,329		290,217
Other account receivable		162,017		138,189
Advanced to suppliers		6,150		-
Inventory		109,381		184,589
Prepaid Expenses		109,576		-
Total Current Assets		890,365		627,499
Property, Plant & Equipment, net		1,829,143		1,935,949
Intangible assets, net		457,653		457,029
Total Assets		3,177,161		3,020,477

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable			44,467			44,406
Advance from Customers			125,429			145,108
Tax Payable			26,421			28,037
Accrued expenses and other payable			1,090,772			734,069
	Total Current Liabilities		1,287,089			951,620
Long-Term Liabilities:
Long Term Loan			1,716,047			1,700,523
	Total Long-Term Liabilities		-			-
	Total Liabilities		3,003,136			2,652,143
Stockholders' Equity:
Capital			2,016,090			1,976,318
Accumulated other comprehensive income			(62,545	)		(23,128	)
Retained Earnings			(1,779,520	)		(1,584,856	)
Total Stockholders' Equity			174,025			368,334
Total Liabilities and Stockholders' Equity		$	3,177,161		$	3,020,477

The accompanying notes are an integral part of the financial statements

F-1 

SNX ORGANIC FERTILIZER, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

  FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2009

(UNAUDITED)

	Three Months Ended						Six Months Ended
	September 30,						September 30,
	2009			2008			2009			2008
Revenues	$	(10	)	$	1,006		$	36,400		$	116,883
Cost of Goods Sold		(26	)		1,328			96,302			154,240
Gross Profit (Loss)		16			(322	)		(59,902	)		(37,357	)
Operating Expenses:
Sales Expenses		0			816			1,466			7,146
General and Administrative Expenses		61,531			69,407			133,127			202,356
Total Operating Expenses		61,531			70,223			134,593			209,502
Loss from Operations before other Income & Expense		(61,515	)		(70,545	)		(194,495	)		(246,859	)
Other Income & (Expense):
Other income		18			(2	)		33			31
Financial expense		(111	)		130			(203	)		(258	)
Non Operating Loss		(93	)		128			(170	)		(227	)
Loss Before Income Taxes		(61,608	)		(70,417	)		(194,664	)		(247,086	)
Provision For Income Taxes		0			0			0			0
Net Income (Loss)		(61,608	)		(70,417	)		(194,664	)		(247,086	)
Other Comprehensive Items:
Foreign Currency Translation Gain (Loss)		(30,239	)		(1	)		(59,837	)		(52,726	)
Net Comprehensive Income (Loss)	$	(91,847	)	$	(70,418	)	$	(254,501	)	$	(299,812	)

The accompanying notes are an integral part of the financial statements

F-2 

SNX ORGANIC FERTILIZER, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

  FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2009 & 2008

(UNAUDITED)

	For Six Months Ended
Cash Flows From Operating Activities:	September 30,
	2009			2008
Net Income (loss)	$	(194,664	)	$	(247,086	)
Adjustments To Reconcile Net Income To Net Cash
Provided By Operating Activities:
Depreciation and Amortization Expense		39,133			46,017
(Increase) or Decrease in Current Assets:
Accounts Receivable		63,888			22,209
Inventories		75,208			39,872
Advanced to Suppliers		(6,150	)		(142,048	)
Other account receivable		(23,823	)		121,279
Prepaid Expenses		(109,577	)		3,568
Increase or (Decrease) in Current Liabilities:
Accounts Payable		-			215,234
Advanced from Customers		(19,679	)		(92,492	)
Tax Payable		(1,616	)		6
Other payable		352,234			(7,427	)
Accrued expense		4,469			21,446
Net Cash ( Used) Provided by Operating Activities		179,423			(19,422	)
Cash Flows From Investing Activities:
Purchases of Property and Equipment		(75,786	)		(74,028	)
Disposal of Fixed Assets		146,102			-
Net Cash Used in Investing Activities		70,316			(74,028	)
Due to Shareholder		725,835			140,225

Cash Flows From Financing Activities:
Capital contribution		39,771		-
Proceed from Loan		15,524		35,282
Net Cash Used in Financing Activities		55,295		35,282
Effect of exchange rate changes on cash and cash equivalents		(42,626)		3,990
Increase in Cash and Cash Equivalents		262,408		(54,178	)
Cash and Cash Equivalents -Beginning Balance		14,504		194,034
Cash and Cash Equivalents - Ending Balance	$	276,912	$	139,856
Supplemental Disclosures of Cash Flow Information:
Cash Paid During The Years  for:
Interest Paid		-		-
Income Taxes Paid		-		-

The accompanying notes are an integral part of the financial statements

F-3

SNX ORGANIC FERTILIZERS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2009

(Unaudited)

Note 1 – Organization and Description of Business

SNX Organic Fertilizers, Inc. (the “Company”) is formed and registered in the state of Delaware in November 2005. Its core business, through its operating subsidiaries based in china, is to develop, manufacture and market organic fertilizer.

The Company’s business operation is carried on by its subsidiaries, Beijing Shennongxing Technology, Ltd.Co. (“BSNX”). BSNX was formed in June 2002 with a registered capital of five hundred thousand (500,000) RMB. In January 2005, the BSNX has amended its charter and changed its name from Beijing Earth Village Zoology & Touring Developing Central to current name Beijing Shennongxing Technology, Ltd. Co., and has increased its capital to one million (1,000,000) RMB, which is approximately $124,355 US Dollar. In March 2006, the Company acquired 100% of BSNX’s shares, and its shareholders transferred their shares to the Company. The BSNX foreign statue has approved by Haidian Business Bureau in Beijing China. The BSNX operations are extracting color from nature plant, manufacturing and technical counseling organic fertilizer, studying and researching organic agricultural products.

Beijing Shennongxing Huanan Xiangyu Green Fertilizer Ltd, Co. (“HX”) was organized in 2005. HX major products are biology organic fertilizer; organic leaves fertilizer, organic composite fertilizer. HX was located in Huanan county of Heilongjiang province. BSNX signed amanaging agreement with Huanan local government and paid two million two hundred thousand (2,2 Mil) RMB which is equivalent to $265,492 USD to obtain the license for operating right of Xiangyu Fertilizer Company of Huanan County (“XFH”) and XFH’s plant, equipment and brand and related intangible assets for 20 years.

In April 2007, The Company invested one million and seven hundred thousand (1.7 mil) RMB, which is equivalent to $239,670 USD to establish Daqing Shennongxing Xiangyu Technology CO., Ltd (“DSNX”). DSNX engaged to produce complex mixing fertilizer, biology fertilizer, and organic fertilizer, develop and market microbe fertilizer. DSNX is located in Daqing City, Heilongjiang province.

Heilongjiang Xiangyu Organic Fertilizer Co. Ltd (“HSNX”) was established on September 15, 2006. Its registered capital was Five million and two (5,200.000) RMB, which is equivalent to $762,467 USD. On September 19, 2007, the company paid Two million eighty four thousand two hundred thirty two and thirty four cents (2,084,232.34)  RMB, which is equivalent to $304,986 USD to acquire HSNX. HSNX is located in Jiamusi city, Heilongjiang province of China and engaging to produce complex mixing fertilizer and organic fertilizer.

F-4

Note 2 - Summary of Significant Accounting Policies

Unaudited Interim Financial Information

The consolidated interim financial statements included herein have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading.

Principles of consolidation

In addition to the financial statements of SNX organic fertilizer Co. Ltd., the accompanying consolidated financial statements include its wholly owned subsidiary, Beijing Shennongxing Technology Co.Ltd, Daqing Shennongxing Xiangyu Technology Co., Ltd , Heilongjiang Shennongxing Xiangyu Organic Fertilizer Co., Ltd. All significant inter-company transactions and balances have been eliminated in the consolidation.

Use of estimates

The preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue  recognition

The Company’s revenue recognition policies are in compliance with Staff accounting bulletin (SAB) 104. Sales revenue is recognized at the date of shipment to customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectability is reasonably assured. The Company recognizes revenue net of an allowance for estimated returns, at the time the merchandise is sold or services performed. The allowance for

sales returns is estimated based on the Company’s historical experience. Sales taxes are presented on a net basis (excluded from revenues and costs). Payments received before all of the relevant criteria for revenue recognition are satisfied are recorded as unearned revenue.

Cash and cash equivalents

For purposes of the statement of cash flows, the Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.

The Company maintains cash and cash equivalents with financial institutions in the People Republic of China (“PRC”). The Company performs periodic evaluation of the relative credit standing of financial institutions that are considered in the Company’s investment strategy.

F-5

Inventories

Inventories are stated at lower of cost, as determined on a weighted average basis, or market value.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation. Maintenance, repairs and betterments, including replacement of minor items, are charged to expense; major additions to physical properties are capitalized. Depreciation and amortization are provided using the straight-line method for financial reporting purposes, whereas accelerated methods are used for tax purposes.

	Estimated Useful Life
Building	30-40 years
Machinery and equipment	10-20 years
Other equipment	5 years
Transportation equipment	5-7 years

Long-lived assets

The Company accounts for long-lived assets in accordance with ASC 360 “Accounting for the impairment of Disposal of Long-Lived Assets”, which became effective January 1, 2002. Under ASC 360, the Company reviews long-term assets for impairment whenever events or circumstances indicate that the carrying amount of those assets may not be recoverable. The Company has not incurred any losses in connection with the adoption of this statement

Intangible assets

Intangible assets consist of “rights to use land and build a plant.” According to the law of China, the government owns all the land in China. Companies or individuals are authorized to possessand use the land only through land use rights granted by the Chinese government. Land use rightsare being amortized using the straight-line method over the lease term of 50 years. The method toamortize intangible assets is a 50-year straight-line method. The Company also evaluates intangible assets for impairment, at least on an annual basis and whenever events or changes in circumstances indicate that the carrying value may not be recoverable from its estimated future cash flows. Recoverability of intangible assets, other long-lived assets and, goodwill is measuredby comparing their net book value to the related projected undiscounted cash flows form these assets, considering a number of factors including past operating results, budgets, economic projections, market trends and product development cycles. If the net book value of the asset exceeds the related undiscounted cash flows, the asset is considered impaired, and a second test is performed to measure the amount of impairment loss.

Accounting for income taxes

The Company accounts for income taxes in accordance with   Accounting Standards Codification, ASC 740 , which requires that deferred tax assets and liabilities be recognized for future tax consequences attributable to differences between financial statements carrying amounts of existing assets and liabilities and their respective tax basis, In addition, SFAS109 requires recognition of future tax benefits, such as carry forwards, to the extent that realization of such benefits is more likely than not and that a valuation allowance be provided when it is more likely than not that some portion of the deferred tax asset will not be realized.

F-6

Value Added Tax (VAT)

Sales revenue represents the invoiced value of goods, net of a value-added tax (VAT). All of the Company’s Organic fertilizers and bio-fertilizers that are sold in the PRC are subject to a Chinese value-added tax at a rate of 13% or 17% of the gross sales price, respectively. This VAT may be offset by VAT paid by the Company on raw materials and other materials included in the cost of producing their finished products. The Company recorded VAT payable and VAT receivable net of payments in the consolidated financial statements. The VAT tax return is filed to offset the payables against the receivables.

Foreign currency translation and other comprehensive income

The reporting currency of the Company is the United States Dollar (“USD”). The functional currency of the Company and its subsidiaries is the Chinese Renminbi (“RMB”). For financial reporting purposes, RMB has been translated into USD as the reporting currency. Assets and liabilities are translated at the exchange rate in effect at the balance sheet date. Income statement accounts are translated at the average rate of exchange prevailing for the period. Capital accounts are translated at their historical exchange rates when the capital translation occurred. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of stockholders’ equity as “Accumulated other comprehensive income”. Gains and losses resulting from foreign currency transactions are included in accumulated other comprehensive income.

Fair value of financial instruments

The carrying amounts of the Company's financial instruments (including accounts receivable and payable, payables to related parties and bank loan) approximate fair value due to the relatively short period to maturity of these instruments.

Statement of cash flows

In accordance with  Accounting Standards Codification,  ASC 230, “Statement of Cash Flows,” cash flows from the Company’s operations are calculated based upon the local currencies.

As a result, amounts related to assets and liabilities reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet.

New accounting pronouncements

In June 2009, the FASB issued ASC 105, The FASB Accounting Standards Codification TM and the Hierarchy of Generally Accepted Accounting Principles – a replacement of FASB Statement No. 162. The FASB Accounting Standards Codification TM (“Codification”) will become the source of authoritative U.S. generally accepted accounting principles (“GAAP”) recognized by FASB to be applied by nongovernmental entities. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of SFAS 168, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other nongrandfathered non-SEC accounting literature not included in the Codification will become nonauthoritative. ASC 805 is effective for financial statements issued for interim and annual periods ending after September 15, 2009. Adoption of ASC 805 is not expected to have a material impact on the Company’s results of operations or financial position.

In June 2009, the FASB issued ASC 810, Amendments to FASB Interpretation No. 46(R) , which improves financial reporting by enterprises involved with variable interest entities. ASC 810 addresses (1) the effects on certain provisions of FASB Interpretation No. 46 (revised December 2003), Consolidation of Variable Interest Entities, as a result of the elimination of the qualifying special-purpose entity concept in ASC 860 and (2) concerns about the application of certain key provisions of FIN 46(R), including those in which the accounting and disclosures under the Interpretation do not always provide timely and useful information about an enterprise’s involvement in a variable interest entity. ASC 810 shall be effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within the first annual reporting period, and for interim and annual reporting periods thereafter. Earlier application is prohibited. Adoption of ASC 810 is not expected to have a material impact on the Company’s results of operations or financial position.

F-7

 In May 2009, the FASB issued ASC 855, Subsequent Events, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. An entity should apply the requirements of ASC 855 to interim or annual financial periods ending after June 15, 2009. Adoption of ASC 855 did not have a material impact on the Company’s results of operations or financial position.

In April 2009, the FASB issued ASC 270, “Interim Disclosures about Fair Value of Financial Instruments,” which requires quarterly disclosures of the fair value of all financial instruments that are not reflected at fair value in the financial statements, as well as additional disclosures about the method(s) and significant assumptions used to estimate the fair value. Prior to the issuance of this FSP, such disclosures, including quantitative and qualitative information about fair value estimates, were only required on an annual basis. ASC 270 is effective for interim reporting periods ending after June 15, 2009. The adoption of ASC 270 did not have a material effect on the Company’s disclosures.

NOTE 3- ACCOUNTS RECEIVABLE

Management regularly reviews aging of the receivables and changes in payment trends by its customers, and records a reserve when the management believes collection are at risk.

Accounts considered uncollectible are written off. Management concluded that as of September 30, 2009 and March 31 2009 the entire amount is collectible and no allowance for doubtful accounts was reserved. The accounts receivable balance as of September 30, 2009 and March 31 2009 is $226,329and $290,217, respectively.

NOTE 4- INVENTORIES

Inventories are stated at the lower of cost or market using weighted average method. Inventories consist of raw materials; work in process and finished goods. Raw materials mainly consist of organic fertilizer, biology fertilizer, extract color from nature plant. The cost of finished goods included (1) direct costs of raw materials, (2) direct labor, (3) indirect production costs, such as allocable utilities cost, and (4) indirect labor related to the production activities, such as assembling and packaging. Although historically an immaterial concern due to the high inventory turnover in the Chinese organic fertilizer industry, the Company reviews its inventory regularly for possible obsolescence. As of September 30, 2009 and March 31 2009, the Company has not recorded any reserve for inventory obsolescence.

Inventories at September 30, 2009 and March 31 2009 consisted of the following:

	September 30, 2009		March 31, 2009
Raw materials	$	29,125	$	35,755
Work in process		14,852		78,142
Finished goods		65,404		70,692
Totals	$	109,381	$	184,589

F-8

NOTE 5- PROPERTY AND EQUIPMENT, net

A summary of Property and equipment at September 30, 2009 and March 31 2009 is as follows:

	September 30, 2009			March 31, 2009
Building	$	201,135		$	346,764
Transportation equipment		46,562			46,499
Machinery and equipme		1,153,291			1,107,291
Office Equipment		19,053			-
Construction in Process		670,252			657,111
Totals		2,090,293			2,157,665
Less accumulated depreciation		(261,150	)		(221,716	)
Net Fixed Assets	$	1,829,143		$	1,935,949

Depreciation expense for the six months ended as of September 30, 2009 is $39,133.

NOTE 6- INTANGIBLE ASSETS

As of September 30, 2009 and March 31 2009, intangible assets consist of:

	September 30, 2009		March 31, 2009
Trade mark	$	134,913	$	134,729
Land use right		322,740		322,300
Total intangible assets		457,653		457,029
Less: Accumulated amortization
Net value of intangible assets	$	457,653	$	457,029

As of September 30,  and March 31, 2009, the land use right had not been amortized because the land has not utilized for production.

F-9

NOTE 8 – ADVANCES TO SUPPLIERS

As a normal practice of doing business in China, the Company is frequently required to make advance payments to suppliers for raw materials. Such advance payments are interest free. The balances of advances to suppliers were $6,150 and $ 0 as of September 30, 2009 and March 31 2009 respectively.

NOTE 9 - ACCOUNTS PAYABLE

The Company has accounts payable related to the purchase of inventory. This amount represents the accounts payable by the Company to the suppliers of $44,467 and $44,406 at September 30, 2009 and March 31 2009, respectively.

NOTE 10 –OTHER CURRENT LIABILITIES

Other current liabilities consist of:

	September 30, 2009		March 31, 2009
Other payables	$	941,400	$	589,367
Accrued expenses		149,372		144,702
Total	$	1,090,772	$	734,069

NOTE 11- LOAN FROM SHAREHOLDERS

As of September 30, 2009 and March 31 2009, the amount of $1,716,047 and $1,700,523 respectively were due to shareholders. This loan is interest free and Company has not accrued the interest.

NOTE 12 – INCOME TAXES

Under the existing Income Tax Laws of the PRC, the Company is generally subject to an income tax at an effective rate of 33% (30% national income taxes plus 3% local income taxes) on taxable income, which is based on the net income reported in the statutory financial statements after appropriate tax adjustments. The statutory rate has been changed to 25%, effective January 1, 2008.

NOTE 13 – STATUTORY RESERVE

The Company is required to transfer 10% of its net income, as determined in accordance with the PRC accounting rules and regulations, to a statutory surplus reserve fund until such reserve balance reaches 50% of the Company’s registered capital. The transfer to this reserve must be made before distribution of any dividend to shareholders.

The surplus reserve fund is non-distributable other than during liquidation and can be used to fund previous years’ losses, if any, and may be utilized for business expansion or converted into share capital by issuing new shares to existing shareholders in proportion to their shareholding or by increasing the par value of the shares currently held by them, provided that the remaining reserve balance after such issue is not less than 25% of the registered capital. Our company has no profit now, so we don’t calculate Reserved Fund.

F-10

NOTE 14 – CASH AND CONCENTRATION OF RISK

The Company considers all highly liquid assets with original maturities of three months or less at the time of purchase to be cash equivalents. Cash includes cash on hand and demand deposits in accounts maintained with state owned banks within the PRC.

Certain financial instruments are subject to concentration of credit risk They consist of cash and cash equivalents. Balances at financial institutions or state owned banks within the PRC are not covered by insurance. As of September 30, 2009 and March 31 2009, the Company had deposits totaling $276,912 and $14,504 that are not covered by insurance, respectively. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risks on its cash in bank accounts.

The Company's operations are carried out in the People Republic of China. Accordingly, the Company's business, financial condition and results of operations may be influenced by the political, economic and legal environments in the US and China, and by the general state of China's economy. The Company's operations in China are subject to specific considerations and significant risks not typically associated with companies in the North America. These include risks associated with, among others, the political, economic and legal environments and foreign currency exchange. The Company's results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and  among other things.

F-11

SNX ORGANIC FERTILIZERS, INC.

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2009 and 2008

Table of Contents

Consolidated Financial Statements	Page
Report of Independent Registered Public Accounting Firm	F-13
Consolidated Balance Sheet	F-14
Consolidated Statements of Operations	F-15
Consolidated Statements of Change in Stockholders' Equity	F-16
Consolidated Statements of Cash Flows	F-17
Notes to Consolidated Financial Statements	F-18

F-12 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

SNX Organic Fertilizer, Inc. and subsidiaries

Beijing, PRC

We have audited the accompanying consolidated balance sheets of SNX Organic Fertilizer, Inc. and subsidiaries as of March 31, 2009 and 2008 and the related consolidated statements of income, changes in stockholders’ equity, and cash flows for each of the two years ended March 31, 2009 and 2008.  These consolidated 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 standards established by the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. 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 consolidated financial statements referred to above present fairly, in all material respects, the financial position of SNX Organic Fertilizer, Inc. and subsidiaries as of March 31, 2009 and 2008, and the results of its operations, changes in stockholders’ equity, and cash flows for each of the two years ended March 31, 2009 and 2008 in conformity with accounting principles generally accepted in the United States of America.

/s/P.C.Liu, CPA, P.C.

P.C.LIU, CPA,P.C.

Flushing, NY

July 30, 2009

F-13 

SNX ORGANIC FERTILIZERS, INC.

CONSOLIDATED BALANCE SHEETS

FOR THE YEARS ENDED MARCH 31, 2009 and 2008

	2009		2008
Current Assets:
Cash and cash equivalents	$	14,504	$	194,034
Accounts receivable		290,217		239,376
Other account receivable		138,189		65,359
Advanced to suppliers		-		7,140
Inventory (net)		184,589		209,960
Prepaid Expenses		-		3,510
Total Current Assets		627,499		719,379
Property, Plant & Equipment, net		1,935,949		1,554,828
Intangible assets, net		457,029		445,487
Total Assets		3,020,477		2,719,694

Current Liabilities:
Accounts Payable			44,406			66,263
Advance from Customers			145,108			90,959
Tax Payable			28,037			9
Accrued expenses and other payable			734,069			584,895
	Total Current Liabilities		951,620			742,126
Related Party Transactions
Loan from stockholders, current portion			1,700,523			1,714,381
	Total Related Party Transactions		1,700,523			1,714,381
Long-Term Liabilities:
Long Term Loan			-			-
	Total Long-Term Liabilities		-			-
	Total Liabilities		2,652,143			2,456,507
Stockholders' Equity:
Capital			1,976,318			1,127,158
Additional capital			-			-
Accumulated other comprehensive income			(23,128	)		(52,726	)
Retained Earnings			(1,584,856	)		(811,245	)
Total Stockholders' Equity			368,334			263,187
Total Liabilities and Stockholders' Equity		$	3,020,477		$	2,719,694

The accompanying notes are an integral part of the financial statements

F-14 

SNX ORGANIC FERTILIZERS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED MARCH 31, 2009 and 2008

		2009			2008
Revenues		$	117,414		$	-
Cost of Goods Sold			154,941			-
Gross Profit			(37,527	)		-
Operating Expenses:
	Sales Expenses		9,073			14,738
	General and Administrative Expenses		726,254			712,660
	Total Operating Expenses		735,327			727,398
Income from Operations before other Income and (expense)			(772,854	)		(727,398	)
Other Income and (Expense):
	Other income		327			1,422
	Financial expense		(1,084	)		(675	)
Non Operating( income)/expenses			(757	)		747
Income Before Income Taxes			(773,611	)		(726,651	)
Provision For Income Taxes			-			-
Net Income (Loss)			(773,611	)		(726,651	)
Other Comprehensive Items:
	Foreign Currency Translation Gain (Loss)		29,598			(52,726	)
Net Comprehensive Income		$	(744,013	)	$	(779,377	)

The accompanying notes are an integral part of the financial statements

F-15 

SNX ORGANIC FERTILIZERS, INC.

CONSOLIDATED STATEMENTS OF CHANGE IN STOCKHOLDERS' EQUITY

FOR THE YEARS ENDED MARCH 31, 2009 and 2008

									Total
			Comprehensive			Retained			Stockholders'
	Capital		Income			Earnings			Equity
Balance-March 31, 2007	$	763,209	$	-		$	(84,594	)	$	678,615
Net loss for the year							(726,651	)		(726,651	)
Additional contributed capital		363,949								363,949
Foreign currency translation adjustment		-		(52,726	)					(52,726	)
Comprehensive income
Balance- March  31, 2008.		1,127,158		(52,726	)		(811,245	)		263,187
Net loss for the year							(773,611	)		(773,611	)
Additional contributed capital		849,160								849,160
Foreign currency translation adjustment				29,598						29,598
Comprehensive income
Balance- March 31, 2009	$	1,976,318	$	(23,128	)	$	(1,584,856	)	$	368,334

The accompanying notes are an integral part of the financial statements

F-16 

SNX ORGANIC FERTILIZERS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED MARCH 31, 2009 and 2008

Cash Flows From Operating Activities:
	2009			2008
Net Income	$	(773,611	)	$	(726,651	)
Adjustments To Reconcile Net Income To Net Cash
Provided By Operating Activities:
Depreciation and Amortization Expense		112,840			94,030
Loss from Disposal of Fixed Assets
(Increase) or Decrease in Current Assets:
Accounts Receivable		(44,432	)		(225,177	)
Inventories		30,668			177,759
Advanced to Suppliers		7,291			(6,717	)
Other account receivable		(70,805	)		148,521
Prepaid Expenses		3,584			74,434
Increase or (Decrease) in Current Liabilities:
Accounts Payable		(23,465	)		(283,598	)
Advanced from Customers		51,552			85,564
Tax Payable		27,897			(213,765	)
Other payable		(16,033	)		185,662
Accrued expense		149,430			(6,157	)
Due to management		(545,882	)		662,375
Net Cash ( Used) Provided by Operating Activities		(1,090,966	)		(33,720	)
Cash Flows From Investing Activities:
Purchases of Property and Equipment		318,265			-
Additions to Construction in Process		(282,483	)		(397,820	)
Net Cash Used in Investing Activities		35,782			(397,820	)

Cash Flows From Financing Activities:
Capital contribution		871,483			362,691
Net Cash Provided in Financing Activities		871,483			362,691
Increase in Cash and Cash Equivalents		(183,701	)		(68,849	)
Effect of exchange rate changes on cash and cash equivalents					20,547
Cash and Cash Equivalents -Beginning Balance		194,034			242,335
Cash and Cash Equivalents - Ending Balance	$	14,504		$	194,034

The accompanying notes are an integral part of the financial statements

F-17 

SNX ORGANIC FERTILIZER, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2009 AND 2008

 NOTE 1- ORGANIZATION AND DESCRIPTION OF BUSINESS

SNX Organic Fertilizers, Inc. (the “Company”) is formed and registered in the state of Delaware in November 2005. Its core business, through its operating subsidiaries based in china, is to develop, manufacture and market organic fertilizer.

The Company’s business operation is carried on by its subsidiaries, Beijing Shennongxing Technology, Ltd.Co. (“BSNX”). BSNX was formed in June 2002 with a registered capital of five hundred thousand Yuan (500,000) RMB. In January 2005, the BSNX has amended its charter and changed its name from Beijing Earth Village Zoology & Touring Developing Central to current name Beijing Shennongxing Technology, Ltd. Co., and has increased its capital to one million (1,000,000) Yuan RMB, which is approximately $124,355 US Dollar. In March 2006, the Company acquired 100% of BSNX’s shares, and its shareholders transferred their shares to the Company. The BSNX foreign statue has approved by Haidian Business Bureau in Beijing China. The BSNX operations are extracting color from nature plant, manufacturing and technical counseling organic fertilizer, studying and researching organic agricultural products.

Beijing Shennongxing Huanan Xiangyu Green Fertilizer Ltd, Co. (“HX”) was organized in 2005. HX major products are biology organic fertilizer; organic leaves fertilizer, organic composite fertilizer. HX was located in Huanan county of Heilongjiang province. BSNX signed a managing agreement with Huanan local government and paid two million two hundred thousand (2,2 Mil) Yuan RMB which is equivalent to $265,492 USD to obtain the license for operating right of Xiangyu Fertilizer Company of Huanan County (“XFH”) and XFH’s plant, equipment and brand and related intangible assets for 20 years.

In April 2007, The Company invested one million and seven hundred thousand (1.7 mil) Yuan RMB, which is equivalent to $239,670 USD to establish Daqing Shennongxing Xiangyu Technology CO., Ltd (“DSNX”). DSNX engaged to produce complex mixing fertilizer, biology fertilizer, and organic fertilizer, develop and market microbe fertilizer. DSNX is located in Daqing City, Heilongjiang province.

Heilongjiang Xiangyu Organic Fertilizer Co. Ltd (“HSNX”) was established on September 15, 2006. Its registered capital was Five million and two (5,200.000) Yuan RMB, which is equivalent to $762,467 USD. On September 19, 2007, the company paid Two million eighty four thousand two hundred thirty two and thirty four cents (2,084,232.34) Yuan RMB, which is equivalent to $304,986 USD to acquire HSNX. HSNX is located in Jiamusi city, Heilongjiang province of China and engaging to produce complex mixing fertilizer and organic fertilizer.

F-18

NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation

The consolidated financial statements included the accounts of the Company, it’s wholly and majority owned subsidiaries. Significant intercompany accounts and transactions have been eliminated in consolidation.

Use of estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management requires to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and cash equivalents

For purposes of the statement of cash flows, the Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.

The Company maintains cash and cash equivalents with financial institutions in the People Republic of China (“PRC”). The Company performs periodic evaluation of the relative credit standing of financial institutions that are considered in the Company’s investment strategy.

Inventories

Inventories are stated at lower of cost, as determined on a weighted average basis, or market value.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation.  Maintenance, repairs and betterments, including replacement of minor items, are charged to expense; major additions to physical properties are capitalized. Depreciation and amortization are provided using the straight-line method for financial reporting purposes, whereas accelerated methods are used for tax purposes.

	Depreciation year
Building	30-40 years
Machinery and Equipments	10-20 years
Office Equipments	5 years
Vehicle	5-7 years

F-19

Long-lived assets

The Company accounts for long-lived assets in accordance with SFAS No, 144 “Accounting for the impairment of Disposal of Long-Lived Assets”, which became effective January 1, 2002. Under SFAS No. 144, the Company reviews long-term assets for impairment whenever events or circumstances indicate that the carrying amount of those assets may not be recoverable. The Company has not incurred any losses in connection with the adoption of this statement.

Intangible assets

Intangible assets consist of “rights to use land and build a plant.” According to the law of China, the government owns all the land in China. Companies or individuals are authorized to possess and use the land onlythrough land use rightsgranted by the Chinese government. Land use rights are being amortized using the straight-line method over the lease term of 50 years. The method to amortize intangible assets is a 50-year straight-line method. The Company also evaluates intangible assets for impairment, at least on an annual basis and whenever events or changes in circumstances indicate that the carrying value may not be recoverable from its estimated future cash flows.  Recoverability of intangible assets, other long-lived assets and, goodwill is measured by comparing their net book value to the related projected undiscounted cash flows form these assets, considering a number of factors including past operating results, budgets, economic projections, market trends and product development cycles. If the net book value of the asset exceeds the related undiscounted cash flows, the asset is considered impaired, and a second test is performed to measure the amount of impairment loss.

Revenue recognition

The Company’s revenue recognition policies are in compliance with Staff accounting bulletin (SAB) 104. Sales revenue is recognized at the date of shipment to customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectability is reasonably assured. The Company recognizes revenue net of an allowance for estimated returns, at the time the merchandise is sold or services performed. The allowance for sales returns is estimated based on the Company’s historical experience. Sales taxes are presented on a net basis (excluded from revenues and costs). Payments received before all of the relevant criteria for revenue recognition are satisfied are recorded as unearned revenue.

Accounting for income taxes

The Company accounts for income taxes in accordance with Statement of Financial Accounting Standards No.109 (“SFAS 109”) which requires that deferred tax assets and liabilities be recognized for future tax consequences attributable to differences between financial statements carrying amounts of existing assets and liabilities and their respective tax basis, In addition, SFAS 109 requires recognition of future tax benefits, such as carry forwards, to the extent that realization of such benefits is more likely than not and that a valuation allowance be provided when it is more likely than not that some portion of the deferred tax asset will not be realized.

Value Added Tax (VAT)

Sales revenue represents the invoiced value of goods, net of a value-added tax (VAT).  All of the Company’s Organic fertilizers and bio-fertilizers that are sold in the PRC are subject to a Chinese value-added tax at a rate of 13% or 17% of the gross sales price, respectively.  This VAT may be offset by VAT paid by the Company on raw materials and other materials included in the cost of producing their finished products.  The Company recorded VAT payable and VAT receivable net of payments in the consolidated financial statements.  The VAT tax return is filed to offset the payables against the receivables.

F-20

Foreign currency translation and other comprehensive income

The reporting currency of the Company is the United States Dollar (“USD”). The functional currency of the Company and its subsidiaries is the Chinese Renminbi (“RMB”).

For financial reporting purposes, RMB has been translated into USD as the reporting currency. Assets and liabilities are translated at the exchange rate in effect at the balance sheet date. Income statement accounts are translated at the average rate of exchange prevailing for the period. Capital accounts are translated at their historical exchange rates when the capital translation occurred. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of stockholders’ equity as “Accumulated other comprehensive income”. Gains and losses resulting from foreign currency transactions are included in accumulated other comprehensive income.

Fair value of financial instruments

The carrying amounts of the Company's financial instruments (including accounts receivable and payable, payables to related parties and bank loan) approximate fair value due to the relatively short period to maturity of these instruments.

Statement of cash flows

In accordance with Statement of Financial Accounting Standards No.95, “Statement of Cash Flows,” cash flows from the Company’s operations are calculated based upon the local currencies. As a result, amounts related to assets and liabilities reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet.

New accounting pronouncements

In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles.” The current GAAP hierarchy, as set forth in the American Institute of Certified Public Accountants (AICPA) Statement on Auditing Standards No. 69, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles, has been criticized because (1) it is directed to the auditor rather than the entity, (2) it is complex, and (3) it ranks FASB Statements of Financial Accounting Concepts. The FASB believes that theGAAP hierarchy should be directed to because it is the entity (not its auditor) that is responsible for selecting accounting principles for financial statements that are presented in conformity with GAAP. Accordingly, the FASB concluded that the GAAP hierarchy should reside in the accounting literature established by the FASB and is issuing this Statement to achieve that result. This Statement is effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board amendments to AU Section 411, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles. The adoption of FASB 162 is not expected to have a material impact on the Company’s financial position.  

F-21

In December 2007, the Financial Accounting Standards Board (“FASB”) simultaneously issued SFAS No. 141R, “Business Combinations (2007 Amendment),” and SFAS 160, Non-controlling Interests in Consolidated Financial Statements, an Amendment of ARB 51.”  Both standards update United States guidance on accounting for “non-controlling interests,” sometimes referred to as minority interests, which interests represent a portion of a subsidiary not attributable, directly or indirectly, to a parent. FASB and the International Accounting Standards Board (“IASB”) have been working together to promote international convergence of accounting standards. Prior to promulgation of these new standards there were specific areas in accounting for business acquisitions in which conversion was not achieved. The objective of both standards is to improve the relevance, comparability, and transparency of the financial information that a reporting entity provides in “business combinations” and consolidated financial statements by establishing accounting and reporting standards. In business combinations it is accomplished by establishing principles and requirements concerning how an “acquirer” recognizes and measures identifiable assets acquired, liabilities assumed, and non-controlling interest in the acquiree, as well as goodwill acquired in the combination or gain from a bargain purchase; and determines information to be disclosed to enable users to evaluate the nature and effects of business combinations. In consolidated financial statements the standards require: identification of ownership interests held in subsidiaries by parties other than the parent be clearly identified, labeled and presented in consolidated financial position within equity (rather than “mezzanine” between liabilities and equity) separately from amounts attributed to the parent, with net income attributable to the parent and to the minority interest clearly identified and presented on the face of consolidated statements of income. The standards also provide guidance in situations where the parent’s ownership interest in a subsidiary changes while the parent retains its controlling financial interest. The standard also provides guidance on recording a gain or loss based on fair value in situations involving deconsolidation of a subsidiary. Entities must provide sufficient disclosures

that distinguish between interests of the parent and that of the non-controlling interest.

Both standards are effective for fiscal years and interims beginning on or after December 15, 2008 (that is January 1, 2009) for entities with calendar years. Earlier adoption is prohibited. The standards shall be applied prospectively as of the beginning of the fiscal year in which initially applied, except for the presentation and disclosure requirements, which shall be applied retrospectively for all periods presented. The Company does not anticipate that the adoption of SFAS No. 141R and No. 160 will have an impact on the Company's overall results of operations or financial position, unless the Company makes a business acquisition in which there is a non-controlling interest.

NOTE 3- ACCOUNTS RECEIVABLE

Management regularly reviews aging of the receivables and changes in payment trends by its customers, and records a reserve when the management believes collection are at risk. Accounts considered uncollectible are written off. Management concluded that as of March 31, 2009 and 2008 the entire amount is collectible and no allowance for doubtful accounts was reserved.  The accounts receivable balance as of March 31, 2009 and 2008 is $290,217 and $239,376, respectively.

NOTE 4- INVENTORIES

Inventories are stated at the lower of cost or market using weighted average method. Inventories consist of raw materials; work in process and finished goods. Raw materials mainly consist of organic fertilizer, biology fertilizer, extract color from nature plant. The cost of finished goods included (1) direct costs of raw materials, (2) direct labor, (3) indirect production costs, such as allocable utilities cost, and (4) indirect labor related to the production activities, such as assembling and packaging.

Although historically an immaterial concern due to the high inventory turnover in the Chinese organic fertilizer industry, the Company reviews its inventory regularly for possible obsolescence. As of March 31, 2009 and 2008, the Company has not recorded any reserve for inventory obsolescence.

F-22

Inventories at March 31, 2009 and 2008 consisted of the following:

	March 31, 2009		March 31, 2008
Raw materials	$	35,755	$	77,373
Work in process		78,142		62,621
Finished goods		70,692		69,966
Total	$	184,589	$	209,960

NOTE 5- PROPERTY AND EQUIPMENT, net

A summary of Property and equipment at March 31, 2009 & 2008 is as follows:

	March 31, 2009			March 31, 2008
Buildings	$	168,660		$	168,660
Vehicles		45,059			45,059
Machinery and Equipment		1,286,834			1,082,840
Subtotal		1,500,553			1,296,559
Less: Accumulated Depreciation		(221,715	)		(105,613	)
Net Fixed Assets		1,278,838			1,190,946
Construction in Progress		657,111			363,882
Total Fixed Assets	$	1,935,949		$	1,554,828

Depreciation expense for the years of March 31, 2009 and 2008 is $112,840 and $94,030, respectively.

F-23

NOTE 6- INTANGIBLE ASSETS

As of March 31, 2009 and 2008, intangible assets consist of:

	March 31, 2009		March 31, 2008
Trademark	$	134,729	$	131,327
Land Use Right		322,300		314,160
Subtotal		457,029		445,487
Less: Accumulated Amortization		-		-
Total Intangible Assets	$	457,029	$	445,487

As of March 31, 2009 and 2008, the land use right has not been amortized because the land has not utilized for production.

NOTE 7 – OTHER RECEVABLES

Other receivables as of March 31, 2009 and 2008 are $138,189 and $65,359, respectively. The receivables are interest free, unsecured, and due on demand.

NOTE 8 – ADVANCES TO SUPPLIERS

As a normal practice of doing business in China, the Company is frequently required to make advance payments to suppliers for raw materials. Such advance payments are interest free. The balances of advances to suppliers were $0 and $7,140 as of March 31, 2009 and 2008 respectively.

NOTE 9 - ACCOUNTS PAYABLE

The Company has accounts payable related to the purchase of inventory. This amount represents the accounts payable by the Company to the suppliers of $44,406 and $66,263 at March 31, 2009 and 2008, respectively.

F-24

NOTE 10 –OTHER CURRENT LIABILITIES

Other current liabilities consist of:

	March 31, 2009		March 31, 2008
Other Payable		589,367		590,183
Accrued Expenses		144,702		(5,288	)
Total		734,069		584,895

NOTE 11- DUE TO MANAGEMENT

As of March 31, 2009 and 2008, the amount of $1,700,523 and $1,714,381 respectively were due to Management.

NOTE 12 – INCOME TAXES

Under the existing Income Tax Laws of the PRC, the Company is generally subject to an income tax at an effective rate of 33% (30% national income taxes plus 3% local income taxes) on taxable income, which is based on the net income reported in the statutory financial statements after appropriate tax adjustments.  The statutory rate has been changed to 25%, effective January 1, 2008.

NOTE 13 – STATUTORY RESERVE

The Company is required to transfer 10% of its net income, as determined in accordance with the PRC accounting rules and regulations, to a statutory surplus reserve fund until such reserve balance reaches 50% of the Company’s registered capital. The transfer to this reserve must be made before distribution of any dividend to shareholders.

The surplus reserve fund is non-distributable other than during liquidation and can be used to fund previous years’ losses, if any, and may be utilized for business expansion or converted into share capital by issuing new shares to existing shareholders in proportion to their shareholding or by increasing the par value of the shares currently held by them, provided that the remaining reserve balance after such issue is not less than 25% of the registered capital.

Our company has no profit now, so we don’t calculate Reserved Fund.

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NOTE 14 – CASH AND CONCENTRATION OF RISK

The Company considers all highly liquid assets with original maturities of three months or less at the time of purchase to be cash equivalents. Cash includes cash on hand and demand deposits in accounts maintained with state owned banks within the PRC.

Certain financial instruments are subject to concentration of credit risk They consist of cash and cash equivalents.  Balances at financial institutions or state owned banks within the PRC are not covered by insurance.  As of March 31, 2009 and 2008, the Company had deposits totaling $14,504 and $194,034 that are not covered by insurance, respectively. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risks on its cash in bank accounts.

The Company's operations are carried out in the People Republic of China.  Accordingly, the Company's business, financial condition and results of operations may be influenced by the political, economic and legal environments in the US and China, and by the general state of China's economy.  The Company's operations in China are subject to specific considerations and significant risks not typically associated with companies in the North America.  These include risks associated with, among others, the political, economic and legal environments and foreign currency exchange.  The Company's results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things.

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EX-3.A

CERTIFICATE OF DESIGNATION

SERIES C PREFERRED STOCK

($.001 Par Value)

of

CHINA SXAN BIOTECH, INC.

Pursuant to Section 78.1955 of the Nevada Revised Statutes

________________________________________

China SXAN Biotech, Inc., a corporation organized and existing under the law of the State of Nevada (the "Corporation"), in accordance with the provisions of Section 78.1955 of the Nevada Revised Statutes, DOES HEREBY CERTIFY as follows:

That pursuant to the authority conferred upon the Board of Directors by the Articles of Incorporation of the Corporation, as amended (“Articles of Incorporation”), the Board of Directors of the Corporation by resolution adopted by written consent in lieu of meeting dated January 15, 2010, adopted the following resolution creating a series of 3,600 shares of Preferred Stock, $.001 par value per share, designated as Series C Preferred Stock:

Section 1.  Designation and Amount. The shares of such series shall be designated as “Series C Preferred Stock” and the number of shares constituting such series shall be 3,600. Such number of shares may be increased or decreased by resolution of the Board of Directors; provided, however, that no decrease shall reduce the number of shares of Series C Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Corporation convertible into Series C Preferred Stock.

Section 2.  Dividends and Distributions.

(A) Dividends.  In the event the Corporation declares a dividend payable in cash or stock to holders of any class of stock, the holder of each share of Series C Preferred Stock shall be entitled to receive a dividend equal in amount and kind to that payable to the holder of the number of shares of the Corporation's common stock (“Common Stock”) into which that holder's Series C Preferred Stock could be converted on the record date for the dividend.

(B)  Liquidation.  Upon the liquidation, dissolution and winding up of the Corporation, the holders of the Series C Preferred Stock shall be entitled to receive in cash out of the assets of the Corporation, whether from capital or from earnings available for distribution to its stockholders, before any amount shall be paid to the holders of Common Stock, the sum of One Cent ($.01) per share, after which the holders of Series C Preferred Stock shall share in the distribution with the holders of the Common Stock on a pari passu basis, except that in determining the appropriate distribution of available cash among the shareholders, each share of Series C Preferred Stock shall be deemed to have been converted into the number of shares of  Common Stock into which that holder’s Series C Preferred Stock could be converted on the record date for the distribution.

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Section 3.  Voting Rights. Except as set forth in Section 6 hereof or as required by applicable law, the holders of shares of Series C Preferred Stock shall have no voting rights.

Section 4.  Reacquired Shares. Any shares of Series C Preferred Stock purchased or otherwise acquired by the Corporation in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock to be created by resolution or resolutions of the Board of Directors, subject to the conditions and restrictions on issuance set forth herein.

Section 5.  Redemption. At any time after June 30, 2010, if there are sufficient authorized common shares to permit conversion of all outstanding shares of Series C Preferred Stock, the Corporation shall be entitled to redeem the shares of Series C Preferred Stock by giving written notice to the registered holders thereof not less than 15 days nor more than 60 days prior to the redemption date.  Each such notice shall state (1) the redemption date, (2) the number of shares to be redeemed from each holder, and (3) the place where certificates for the Series C Preferred Stock are to be surrendered.  Upon surrender in accordance with said notice of certificates for the shares to be redeemed, such shares shall be redeemed at a price of $.001 per share.  Notice having been given, upon the redemption date (unless the Corporation shall default in paying the redemption price), said shares shall no longer be deemed to be outstanding.

Section 6. Voting on Amendment. The Articles of Incorporation of the Corporation shall not be further amended, nor shall any resolution of the directors be adopted after the adoption of this Certificate of Designation that in any manner would materially alter or change the powers, preferences or special rights of the Series C Preferred Stock so as to affect them adversely without the affirmative vote of the holders of at least seventy-five percent of the outstanding shares of Series C Preferred Stock, voting together as a single class.

Section 7. No Impairment. The Corporation will not, by amendment of its Articles of   Incorporation or adoption of a directors’ resolution or by any other means or through any reorganization, recapitalization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Corporation but will at all times in good faith assist in the carrying out of all the provisions of this Certificate of Designation and in the taking of all such action as may be  necessary or  appropriate in order to protect the Conversion Rights of the holders of the Series C Preferred Stock  against impairment.

Section 8. Conversion. The holders of the Series C Preferred Stock shall have the following rights with respect to the conversion of the Series C Preferred Stock into shares of Common Stock (the "Conversion Rights"):

            (A) Conversion.  Subject to and in compliance with the provisions of this Section 8, any shares of Series C Preferred Stock may at any time be converted into fully paid and nonassessable shares of Common Stock (a “Conversion”).  The number of shares of Common Stock to which a holder of Series C Preferred Stock shall be entitled upon a Conversion shall be the product obtained by multiplying the number of shares of Series C Preferred Stock being converted by one hundred thousand (100,000) (“Adjustment Number”).

           (B)  Dividend Payable in Shares of Stock.  In the event the Corporation shall at any time declare or pay any dividend on Common Stock payable in shares of Common Stock, then the Adjustment Number in effect immediately prior to such event shall be adjusted by multiplying such Adjustment Number by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.

            (C) Consolidation, Merger, etc. In case the Corporation shall enter into any consolidation, merger, reorganization, or other transaction in which the shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case the Conversion Rights of Series C Preferred Stock shall at the same time be modified such that, upon Conversion of a share of Series C Preferred Stock, the holder shall receive the product of the Adjustment Number times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed or exchanged.

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(D)  Adjustment for Reclassification, Exchange and Substitution.  At any time or times the Common Stock issuable upon the conversion of the Series C Preferred Stock is changed into the same or a different number of shares of any class or classes of the Corporation’s stock, whether by recapitalization, combination, consolidation, reclassification or otherwise, in any such event the Adjustment Number shall be changed proportionately to the change in the number of shares of Common Stock resulting from the recapitalization, reclassification or other change.

(E) Mechanics of the Conversion.  Upon a Conversion, the holder of Series C Preferred Stock shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Corporation, together with a completed Notice of Conversion in the Form of Exhibit A.  Thereupon, the Corporation shall promptly issue and deliver to such holder a certificate or certificates for the number of shares of Common Stock to which such holder is entitled.  The Conversion shall be deemed to have been made at the close of business on the date of such surrender of the certificates representing the shares of Series C Preferred Stock to be converted.  The person entitled to receive the shares of Common Stock issuable upon a Conversion shall be treated for all purposes as the record holder of such shares of Common Stock on such date.

(F) Reservation of Stock Issuable Upon Conversion.  The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of the Series C Preferred Stock, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding shares of the Series C Preferred Stock.  If at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Series C Preferred Stock, the Corporation shall, at the request of any holder of Series C Preferred Stock,  take such  corporate action as may, in the  opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purpose.

Section 9. Notices of Record Date.  Upon (i) any taking by the Corporation of a record of the  holders of any class of  securities for the purpose of determining  the holders thereof  who are  entitled to receive any dividend or other  distribution, or (ii) any sale of the Corporation, capital reorganization of the Corporation, any  reclassification or recapitalization of the capital  stock of  the  Corporation,  or any  voluntary  or  involuntary dissolution, liquidation or winding up of the Corporation, the Corporation shall mail to each  holder of Series C Preferred Stock at least twenty (20) days  prior to the record date specified therein a notice specifying (A) the date on which any such record is to be taken for the  purpose of such  dividend or  distribution and a description of such  dividend or distribution,  (B) the date on which any such sale of the Corporation, reorganization, reclassification, recapitalization, dissolution, liquidation or winding up is expected to become effective, and (C) the date, if any, that is to be fixed as to when the holders of record of Common Stock (or other securities) shall be entitled to exchange their shares of Common Stock (or other  securities) for securities or other property deliverable  upon such sale of the Corporation, reorganization, reclassification, recapitalization, dissolution, liquidation or winding up.

Section 10.  Notices.  Any notice required by the provisions of this Certificate of Designation shall be in writing and shall be deemed effectively given:  (i) upon personal delivery to the party to be notified, (ii) when sent by confirmed facsimile if sent during normal business hours of the recipient; if not, then on the next business day, or (iii) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All notices shall be addressed to each holder of record at the address of such holder appearing on the books of the Corporation.

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Designation to be signed by its duly authorized officer this 15th  day of January 2010.

CHINA SXAN BIOTECH, INC.

By: /s/ Feng Zhenxing

        Feng Zhenxing, President

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Exhibit A

NOTICE OF CONVERSION

Reference is made to the Certificate of Designation of SERIES C PREFERRED STOCK dated January 15, 2010 (the "Certificate of Designation"), of CHINA SXAN BIOTECH, INC., a Nevada corporation (the "Corporation").  In accordance with and pursuant to the Certificate of Designation, the undersigned hereby elects to convert the number of shares of Series C Preferred Stock, par value $0.001 per share (the “Preferred Shares”) indicated below into shares of Common Stock, par value $0.001 per share (the "Common Stock"), of the Company, by tendering the stock certificate(s) representing the Preferred Shares specified below as of the date specified below.

Date of Conversion:________________________________

Number of Preferred Shares to be converted:_________________________________

Please confirm the following information:

Number of shares of Common Stock to be issued:_____________________________

Please issue the Common Stock into which the Preferred Shares are being converted in the following name and to the following address:

Issue to:__________________________________

Address:__________________________________

__________________________________

Facsimile Number:__________________________________

Authorization:__________________________________

By: ___________________________

Title: ___________________________

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EX-10.A

MERGER AGREEMENT

by and among

CHINA SXAN BIOTECH, INC.,

a Nevada corporation,

SNX ACQUISITION CORP.,

a Nevada corporation

and

SNX ORGANIC FERTILIZERS, INC.

a Delaware corporation

Dated as of January 15, 2010

MERGER AGREEMENT

This Merger Agreement (the “Agreement”) is made and entered into as of January 15, 2010 by and among China SXAN Biotech, Inc.., a Nevada corporation (“CSXB”), SNX Acquisition Corp., a Nevada corporation (the “Merger Sub”), and SNX Organic Fertilizers Inc., a corporation formed under the laws of the State of Delaware (“SNX”). Each of CSXB, Merger Sub and SNX is referred to herein individually as a “Party” and all are referred to collectively as the “Parties.”

PREAMBLE

WHEREAS, SNX owns 100% of the equity of Beijing Shennongxing Technology Co. Ltd., a wholly foreign-owned enterprise (WOFE) organized under the laws of the People’s Republic of China (“Beijing SNX”).

WHEREAS, CSXBis an OTCBB listing company, organized under the laws of State of Nevada.

WHEREAS, the Boards of Directors of CSXB and SNX have determined that a business combination between CSXB and SNX is advisable and in the best interests of their respective companies and stockholders and in furtherance thereof have approved the merger of SNX into Merger Sub, which is a wholly-owned subsidiary of CSXB (the “Merger”).

WHEREAS, pursuant to the Merger, all issued and outstanding shares of common stock of SNX, $0.00001 par value (the “SNX Shares”), shall be cancelled and converted into the right to receive common shares and shares of CSXB Series C Preferred Stock (the “Merger Shares”), which shares shall collectively represent approximately 94.55% of the voting stock of CSXB after the Merger.

WHEREAS, in connection with the Merger, the directors and officers of CSXB will resign from their positions and appoint directors and officers designated by SNX.

WHEREAS, prior to the Merger, American SXAN Biotech, Inc., a Delaware corporation and a wholly-owned subsidiary of CSXB (“SXAN Holding”), which owns all of the assets of CSXB, will enter into an agreement with CSXB and Feng Zhenxin, its CEO, pursuant to which SXAN Holdings will assumed all of the actual and contingent liabilities of CSXB which existed prior to the Merger, and Mr. Feng will manage SXAN Holdings after the Merger.

NOW, THEREFORE, in consideration of the premises and the mutual covenants, representations and warranties contained herein, the Parties, intending to be legally bound, hereby agree as follows:

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CERTAIN DEFINITIONS

As used in this Agreement, the following terms shall have the meanings set forth below:

“Acquired Entities” means SNX and Beijing SNX, collectively.

“Applicable Law” means any domestic or foreign law, statute, regulation, rule, policy, guideline or ordinance applicable to the businesses of the Parties or to the Merger.

“Beijing SNX” has the meaning set forth in the Preamble.

“Closing” has the meaning set forth in Section 1.02.

“DGCL”means the Delaware General Corporation Law.

"Knowledge” means, in the case of CSXB or SNX, a particular fact or other matter of which its Chief Executive Officer or Chief Financial Officer is actually aware or which a prudent individual serving in such capacity could be expected to discover or otherwise become aware of in the course of conducting a reasonable review or investigation of the corporation and its business and affairs.

“Lien” means, with respect to any property or asset, any mortgage, lien, pledge, charge, security interest, claim, encumbrance, royalty interest, any other adverse claim of any kind in respect of such property or asset, or any other restrictions or limitations of any nature whatsoever.

“Material Adverse Effect” with respect to any entity or group of entities means any event, change or effect that has or would have a materially adverse effect on the financial condition, business or results of operations of such entity or group of entities, taken as a whole.

“Merger” has the meaning set forth in the Preamble.

“Merger Shares” has the meaning set forth in the Preamble.

“NGCL”means the Nevada General Corporation Law.

 “Person” means any individual, corporation, partnership, trust or unincorporated organization or a government or any agency or political subdivision thereof.

“SNX Shares” has the meaning set forth in the Preamble.

“Tax” (and, with correlative meaning, “Taxes” and “Taxable”) means:

(i) any income, alternative or add-on minimum tax, gross receipts tax, sales tax, use tax, ad valorem tax, transfer tax, franchise tax, profits tax, license tax, withholding tax, payroll tax, employment tax, excise tax, severance tax, stamp tax, occupation tax, property tax, environmental or windfall profit tax, custom, duty or other tax, impost, levy, governmental fee or other like assessment or charge of any kind whatsoever together with any interest or any penalty, addition to tax or additional amount imposed with respect thereto by any governmental or Tax authority responsible for the imposition of any such tax (domestic or foreign), and

(ii) any liability for the payment of any amounts of the type described in clause (i) above as a result of being a member of an affiliated, consolidated, combined or unitary group for any taxable period, and

(iii) any liability for the payment of any amounts of the type described in clauses (i) or (ii) above as a result of any express or implied obligation to indemnify any other person.

“Tax Return” means any return, declaration, form, claim for refund or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

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ARTICLE I

THE MERGER

SECTION 1.01                                THE MERGER

Upon the terms and subject to the conditions set forth in this Agreement and in accordance with the NGCL, at the Effective Time (as hereinafter defined), all SNX Shares shall be cancelled and converted into the right to receive the Merger Shares.  In connection therewith, the following terms shall apply:

(a)           Exchange Agent.  Robert Brantl, Esq., counsel for SNX, shall act as the exchange agent (the “Exchange Agent”) for the purpose of exchanging SNX Shares for the Merger Shares.   At or prior to the Closing, CSXB shall deliver to the Exchange Agent the Merger Shares.

(b)           Series C Preferred Shares.  Prior to the Closing, CSXB shall file with the Secretary of State of Nevada a Certificate of Designation of Series C Preferred Shares in the form of Schedule 1.01 hereto.

(c)           Conversion of Securities.

(i)           Conversion of SNX Securities.  At the Effective Time, by virtue of the Merger and without any action on the part of CSXB, SNX or the Merger Sub, or the holders of any of their respective securities:

(A)           The issued and outstanding shares of common stock of SNX (the “SNX Shares”) immediately prior to the Effective Time shall be converted into and represent the right to receive, and shall be exchangeable for, a total of 40,000,000 shares of the Common Stock of CSXB and 3,600 shares of Series C Preferred Share of CSXB (collectively, the “Merger Shares”).  The Merger Shares shall be distributed among the shareholders of SNX in proportion to their respective ownership interests in SNX.

(B)           All SNX Shares shall no longer be outstanding and shall automatically be canceled and retired and shall cease to exist, and each holder of a certificate representing any such shares shall cease to have any rights with respect thereto, except the right to receive the Merger Shares to be issued pursuant to this Section 1.02(c)(i) upon the surrender of such certificate in accordance with Section 1.07, without interest.  No fractional shares may be issued; but each fractional share that would result from the Merger will be rounded to the nearest number of whole shares.

(C)           The Series C Preferred Stock included in the Merger Shares shall be convertible into 360,000,000 shares of Common Stock of CSXB.  The Merger Shares shall represent 94.55% on a fully diluted basis, of the voting power of all classes of issued and outstanding stock of CSXB at the Effective Time, after giving effect to the Merger.

(ii)           Conversion of Merger Sub Stock.  At the Effective Time, by virtue of the Merger and without any action on the part of SNX, CSXB, the Merger Sub, or the holders of any of their respective securities, each share of capital stock of Merger Sub outstanding immediately prior to the Effective Time shall be converted into one share of the common stock of the Surviving Entity and the shares of common stock of the Surviving Entity so issued in such conversion shall constitute the only outstanding shares of capital stock of the Surviving Entity and the Surviving Entity shall be a wholly owned subsidiary of CSXB.

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SECTION 1.02                                           CLOSING

The closing of the Merger (the “Closing”) will take place at the offices of Robert Brantl, Esq. within one (1) business day following the satisfaction or waiver of the conditions precedent set forth in Article V or at such other date as CSXB and SNX shall agree (the “Closing Date”), but in any event no later than January 31, 2010 unless extended by a written agreement of CSXB and SNX.

SECTION 1.03                                           MERGER; EFFECTIVE TIME

At the Effective Time and subject to and upon the terms and conditions of this Agreement, SNX shall merge with and into Merger Sub in accordance with the provisions of the NGCL, the separate corporate existence of SNX shall cease and Merger Sub shall continue as the Surviving Entity.  The Effective Time shall occur upon the latter of the filing with the Secretary of State of the State of Delaware of a Certificate of Merger, executed in accordance with the applicable provisions of the DGCL, and the filing with the Secretary of State of the State of Nevada of Articles of Merger, executed in accordance with the applicable provisions of the NGCL (the “Effective Time”).  The date on which the Effective Time occurs is referred to as the “Effective Date.”  Provided that this Agreement has not been terminated pursuant to Article VI, the Parties will cause the Certificate of Merger and the Articles of Merger to be filed as soon as practicable after the Closing.

SECTION 1.04                                            EFFECT OF THE MERGER

The Merger shall have the effect set forth in Section 92A.250 of the Nevada Revised Statutes.  Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all the properties, rights, privileges, powers and franchises of SNX and Merger Sub shall vest in the Surviving Entity, and all debts, liabilities and duties of SNX and Merger Sub shall become the debts, liabilities and duties of the Surviving Entity.

SECTION 1.05 CERTIFICATE OF INCORPORATION AND BYLAWS; DIRECTORS AND OFFICERS

Pursuant to the Merger:

(a)           The Certificate of Incorporation and Bylaws of Merger Sub as in effect immediately prior to the Effective Time shall be the Certificate of Incorporation and Bylaws of the Surviving Entity immediately following the Merger.

(b)           The directors and officers of SNX immediately prior to the Merger shall be the directors and officers of the Surviving Entity subsequent to the Merger.

SECTION 1.06 RESTRICTIONS ON RESALE

(a)           The Series C Preferred Shares issued pursuant to the Merger will not be registered under the Securities Act, or the securities laws of any state, and cannot be transferred, hypothecated, sold or otherwise disposed of until:  (i) a registration statement with respect to such securities is declared effective under the Securities Act, or (ii) CSXB receives an opinion of counsel for the holders of the shares proposed to be transferred, reasonably satisfactory to counsel for CSXB, that an exemption from the registration requirements of the Securities Act is available.

The certificates representing the Merger Shares which are being issued hereunder shall contain a legend substantially as follows:

“THE SECURITIES WHICH ARE REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNTIL A REGISTRATION STATEMENT WITH RESPECT THERETO IS DECLARED EFFECTIVE UNDER SUCH ACT, OR CHINA SXAN BIOTECH, INC. RECEIVES AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO CHINA SXAN BIOTECH, INC.  THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT IS AVAILABLE.”

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SECTION 1.07                                EXCHANGE OF CERTIFICATES

(a)           EXCHANGE OF CERTIFICATES.  After the Effective Time, the holders of the SNX Shares shall be required to surrender all their SNX Shares to the Exchange Agent, and the holders shall be entitled upon such surrender to receive in exchange therefor certificates representing the proportionate number of Merger Shares into which the SNX Shares theretofore represented by the stock certificates so surrendered shall have been exchanged pursuant to this Agreement.  Until so surrendered, each outstanding certificate which, prior to the Effective Time, represented SNX Shares shall be deemed for all corporate purposes, subject to the further provisions of this Article I, to evidence the ownership of the number of whole Merger Shares for which such SNX Shares have been so exchanged.  No dividend payable to holders of Merger Shares of record as of any date subsequent to the Effective Time shall be paid to the owner of any certificate which, prior to the Effective Time, represented SNX Shares, until such certificate or certificates representing all the relevant SNX Shares, together with a stock transfer form, are surrendered as provided in this Article I or pursuant to letters of transmittal or other instructions with respect to lost certificates provided by the Exchange Agent.

(b)           FULL SATISFACTION OF RIGHTS.  All Merger Shares for which the SNX Shares shall have been exchanged pursuant to this Article I shall be deemed to have been issued in full satisfaction of all rights pertaining to the SNX Shares.

(c)           EXCHANGE OF CERTIFICATES.  All certificates representing SNX Shares converted into the right to receive Merger Shares pursuant to this Article I shall be furnished to CSXB subsequent to delivery thereof to the Exchange Agent pursuant to this Agreement.

(d)           CLOSING OF TRANSFER BOOKS.  On the Effective Date, the stock transfer book of SNX shall be deemed to be closed and no transfer of SNX Shares shall thereafter be recorded thereon.

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ARTICLE II

REPRESENTATIONS AND WARRANTIES OF CSXB

CSXB hereby represents and warrants to SNX, as of the date of this Agreement, and as of the Closing Date, except at otherwise indicated, and except in each case as disclosed in the CSXB disclosure letter delivered as of the date hereof, as follows:

SECTION 2.01     ORGANIZATION, STANDING AND POWER

CSXB is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Nevada, and has corporate power and authority to conduct its business as presently conducted by it and to enter into and perform this Agreement and to carry out the transactions contemplated by this Agreement. CSXB has the power to own its properties and to carry on its business as now being conducted and as presently proposed to be conducted and is duly authorized and qualified to do business and is in good standing in each jurisdiction in which the failure to be so qualified and in good standing would have a Material Adverse Effect on CSXB. CSXB has delivered or made available to SNX a true and correct copy of the Articles of Incorporation (the “Articles of Incorporation”), and the Bylaws, or other charter documents, as applicable, of CSXB, each as amended to date. CSXB is not in violation of any of the provisions of its respective charter or bylaws or equivalent organization documents. Except as set forth in Section 2.02 hereof, there are no outstanding subscriptions, options, warrants, puts, calls, rights, exchangeable or convertible securities or other commitments or agreements of any character relating to the issued or unissued capital stock or other securities of CSXB, or otherwise obligating CSXB to issue, transfer, sell, purchase, redeem or otherwise acquire any such securities. CSXB does not directly or indirectly own any equity or similar interest in, or any interest convertible or exchangeable or exercisable for, any equity or similar interest in, any corporation, partnership, joint venture or other business association or entity, other than SXAN Holding.

 SECTION 2.02     CAPITALIZATION

(a)   There are 200,000,000 shares of capital stock, $.001 par value, of CSXB authorized, consisting of 100,000,000 shares of common stock (the “CSXB Common Shares”), 99,900,000 shares of Preferred Stock (the “CSXB Preferred Stock”) and 100,000 shares of Series B Convertible Preferred Stock (the “CSXB Series B Shares”). As of the date of this Agreement, there are 19,919,795 CSXB Common Shares issued and outstanding and no shares of CSXB Preferred Stock or CSXB Series B Preferred Stock outstanding..

(b)    Except for contractual rights exchangeable for a total of 153,442 shares of CXSB Common Stock, which have been designated as Series A Preferred Stock on the CSXB balance sheet, there are no contracts, commitments or agreements relating to voting, purchase or sale of CSXB’s capital stock (i) between or among CSXB and any Person and (ii) to the best of CSXB’s knowledge, between or among any of CSXB’s stockholders.

(c)   All outstanding CSXB Common Shares are validly issued, fully paid, non-assessable, not subject to pre-emptive rights and have been issued in compliance with all state and federal securities laws or other Applicable Law.

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 SECTION 2.03     AUTHORITY FOR AGREEMENT

The execution, delivery, and performance of this Agreement by CSXB has been duly authorized by all necessary corporate and shareholder action, and this Agreement, upon its execution by the Parties, will constitute the valid and binding obligation of CSXB and Merger Sub, enforceable against each of them in accordance with and subject to its terms, except as enforceability may be affected by bankruptcy, insolvency or other laws of general application affecting the enforcement of creditors' rights. The execution and consummation of the transactions contemplated by this Agreement and compliance with its provisions by CSXB will not violate any provision of Applicable Law and will not conflict with or result in any breach of any of the terms, conditions, or provisions of, or constitute a default under, CSXB's Articles of Incorporation or their Bylaws, in each case as amended, or, in any material respect, any indenture, lease, loan agreement or other agreement or instrument to which CSXB is a party or by which it or any of its properties is bound, or any decree, judgment, order, statute, rule or regulation applicable to CSXB.  No consent, approval, order or authorization of, or registration, declaration or filing with, any court, administrative agency or commission or other governmental authority or instrumentality (“Governmental Entity”) is required by or with respect to CSXB in connection with the execution and delivery of this Agreement, or the consummation of the transactions contemplated hereby and thereby.

SECTION 2.04     SEC DOCUMENTS; FINANCIAL CONDITION

CSXB has made available to SNX a true and complete copy of each statement, report, registration statement, definitive proxy statement, and other filings filed with the SEC by CSXB since January 1, 2008 (collectively, the “CSXB SEC Documents”). The CSXB SEC Documents are subject to pending comments by the Securities and Exchange Commission.  Subject to such changes as may be required in order to respond satisfactorily to the SEC’s comments, as of their respective filing dates the CSXB SEC Documents complied in all material respects with the requirements of the Exchange Act and the Securities Act, and none of the CSXB SEC Documents contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances in which they were made, not misleading, except to the extent corrected by a subsequently filed CSXB SEC Document. The financial statements of CSXB, including the notes thereto, included in the CSXB SEC Documents (the “CSXB Financial Statements”) were complete and correct in all material respects as of their respective dates, complied as to form in all material respects with applicable accounting requirements and with the published rules and regulations of the SEC with respect thereto as of their respective dates, and have been prepared in accordance with GAAP applied on a basis consistent throughout the periods indicated and consistent with each other (except as may be indicated in the notes thereto or, in the case of unaudited statements included in Quarterly Reports on Form 10-Q, as permitted by Form 10-Q of the SEC). The CSXB Financial Statements fairly present the financial condition and operating results of CSXB at the dates and during the periods indicated therein (subject, in the case of unaudited statements, to normal, recurring year-end adjustments).

SECTION 2.05     SARBANES-OXLEY ACT OF 2002

There has been no change in CSXB accounting policies since June 30, 2009 except as described in the notes to the CSXB Financial Statements. Each required form, report and document containing financial statements that has been filed with or submitted to the SEC since November 30, 2001, was accompanied by the certifications required to be filed or submitted by CSXB’s chief executive officer and chief financial officer pursuant to the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), and at the time of filing or submission of each such certification, such certification was true and accurate and materially complied with the Sarbanes-Oxley Act and the rules and regulations promulgated thereunder. Since June 30, 2009, neither CSXB nor, to the knowledge of the CSXB, any director, officer, employee, auditor, accountant or representative of CSXB or any of its subsidiaries has received or otherwise had or obtained knowledge of any complaint, allegation, assertion or claim, whether written or oral, regarding the accounting or auditing practices, procedures, methodologies or methods of CSXB or their respective internal accounting controls, including any complaint, allegation, assertion or claim that CSXB has engaged in questionable accounting or auditing practices, except for (A) any complaint, allegation, assertion or claim as has been resolved without any resulting change to CSXB’s accounting or auditing practices, procedures methodologies or methods of CSXB or its internal accounting controls and (b) questions regarding such matters raised and resolved in the ordinary course in connection with the preparation and review of CSXB’s financial statements and periodic reports. To the knowledge of CSXB, no attorney representing CSXB, whether or not employed by CSXB, has reported evidence of a material violation of securities laws, breach of fiduciary duty or similar violation by CSXB or any of its officers, directors, employees or agents to the Board of Directors of CSXB or any committee thereof or to any director or officer of CSXB. To the knowledge of CSXB, no employee of CSXB has provided or is providing information to any law enforcement agency regarding the commission or possible commission of any crime or the violation or possible violation of any applicable law.

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SECTION 2.06     ABSENCE OF CERTAIN CHANGES OR EVENTS

Since September 30, 2009,

(a)   there has not been any Material Adverse Change in the business, operations, properties, assets, or condition of CSXB;

(b)   CSXB has not (i) amended its Articles of Incorporation; (ii) declared or made, or agreed to declare or make, any payment of dividends or distributions of any assets of any kind whatsoever to stockholders or exchanged or redeemed, or agreed to exchange or redeem, any outstanding capital stock; (iii) made any material change in its method of management, operation, or accounting; (iv) entered into any material transaction; or (v) made any accrual or arrangement for payment of bonuses or special compensation of any kind or any severance or termination pay to any present or former officer or employee;

(c)   CSXB has not (i) borrowed or agreed to borrow any funds or incurred, or become subject to, any material obligation or liability (absolute or contingent) except liabilities incurred in the ordinary course of business; (ii) paid any material obligation or liability (absolute or contingent) other than current liabilities reflected in or shown on the most recent CSXB balance sheet, and current liabilities incurred since that date in the ordinary course of business; (iii) sold or transferred, or agreed to sell or transfer, any material assets, properties, or rights, or canceled, or agreed to cancel, any material debts or claims; or (iv) made or permitted any material amendment or termination of any contract, agreement, or license to which it is a party.

SECTION 2.07    ABSENCE OF UNDISCLOSED LIABILITIES

CSXB has no material obligations or liabilities of any nature (matured or unmatured, fixed or contingent) other than (i) those set forth or adequately provided for in the Balance Sheet included in CSXB’s Quarterly Report on Form 10-Q for the period ended September 30, 2009 (the “CSXB Balance Sheet”), (ii) those incurred in the ordinary course of business and not required to be set forth in the CSXB Balance Sheet under GAAP, (iii) those incurred in the ordinary course of business since the CSXB Balance Sheet date and not reasonably likely to have a Material Adverse Effect on CSXB, and (iv) those incurred in connection with this Agreement.

SECTION 2.08     GOVERNMENTAL AND THIRD PARTY CONSENTS

No consent, waiver, approval, order or authorization of, or registration, declaration or filing with, any court, administrative agency or commission or other federal, state, county, local or other foreign governmental authority, instrumentality, agency or commission or any third party, including a party to any agreement with CSXB, is required by or with respect to CSXB in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby, except for such consents, waivers, approvals, orders, authorizations, registrations, declarations and filings as may be required under (i) applicable securities laws, or (ii) the NGCL.

 SECTION 2.09     LITIGATION

There is no action, suit, investigation, audit or proceeding pending against, or to the Knowledge of CSXB, threatened against or affecting CSXB or any of its respective assets or properties before any court or arbitrator or any governmental body, agency or official.  There is no injunction, judgment, decree, order or regulatory restriction imposed upon CSXB or any of its respective assets or business, or, to the knowledge of CSXB, any of its respective directors or officers (in their capacities as such), that would prevent, enjoin, alter or materially delay any of the transactions contemplated by this Agreement, or that could reasonably be expected to have a Material Adverse Effect on CSXB.

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 SECTION 2.10     INTERESTED PARTY TRANSACTIONS

Except as disclosed in its SEC filings, CSXB is not indebted to any officer or director of CSXB (except for amounts due as normal salaries and bonuses and in reimbursement of ordinary expenses), and no such person is indebted to CSXB, and there are no other transactions of the type required to be disclosed pursuant to Items 402 or 404 of Regulation S-K under the Securities Act and the Exchange Act.

 SECTION 2.11     COMPLIANCE WITH APPLICABLE LAWS

To the Knowledge of CSXB, the business of CSXB has not been, and is not being, conducted in violation of any Applicable Law.  

 SECTION 2.12     TAX RETURNS AND PAYMENT

CSXB has duly and timely filed all material Tax Returns required to be filed by it and has duly and timely paid all Taxes shown thereon to be due. There is no claim for Taxes that is a Lien against the property of CSXB other than Liens for Taxes not yet due and payable. CSXB has not received written notification of any audit of any Tax Return of CSXB being conducted or pending by a Tax authority, no extension or waiver of the statute of limitations on the assessment of any Taxes has been granted by CSXB which is currently in effect, and CSXB is not a party to any agreement, contract or arrangement with any Tax authority or otherwise, which may result in the payment of any material amount in excess of the amount reflected on the above referenced CSXB Financial Statements.

SECTION 2.13     SECURITY LISTING

CSXB is a fully compliant reporting company under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and all CSXB public filings required under the Exchange Act have been made. The common stock of CSXB is listed for quotation on the OTC Bulletin Board. To the Knowledge of CSXB, CSXB has not been threatened or is not subject to removal of its common stock from the OTC Bulletin Board.

SECTION 2.14     FINDERS’ FEES

CSXB has not incurred, nor will it incur, directly or indirectly, any liability for brokers’ or finders’ fees or agents’ commissions or investment bankers’ fees or any similar charges in connection with this Agreement or any transaction contemplated hereby.

SECTION 2.15     MINUTE BOOKS

The minute books of CSXB made available to SNX contain in all material respects a complete and accurate summary of all meetings of directors and stockholders or actions by written consent of CSXB during the past three years and through the date of this Agreement, and reflect all transactions referred to in such minutes accurately in all material respects.

SECTION 2.16     VOTE REQUIRED

The approval of CSXB’s Board of Directors is the only approval or vote necessary to approve this Agreement and the transactions contemplated hereby on behalf of such entity.

SECTION 2.17     BOARD APPOVAL

The Board of Directors of CSXB has (i) approved this Agreement and the Merger, and (ii) approved the issuance of the Merger Shares pursuant to Section 1.01.

SECTION 2.18     EMPLOYEE BENEFIT PLANS

There are no employee benefit plans maintained by CSXB.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SNX

SNX hereby represents and warrants to CSXB, as of the date of this Agreement and as of the Closing Date (except as otherwise indicated, and except in each case as disclosed in the SNX disclosure letter delivered as of the date hereof), as follows:

SECTION 3.01     ORGANIZATION, STANDING AND POWER

SNX is a privately held corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware, and has full corporate power and authority to conduct its business as presently conducted by it and to enter into and perform this Agreement and to carry out the transactions contemplated by this Agreement. SNX is duly qualified to do business as a foreign corporation in each state in which the nature of the business conducted by it or the character or location of the properties and assets owned or leased by it make such qualification necessary. Each of SNX and its subsidiaries has the power to own its properties and to carry on its business as now being conducted and as presently proposed to be conducted and is duly authorized and qualified to do business and is in good standing in each jurisdiction in which the failure to be so qualified and in good standing would have a Material Adverse Effect on SNX. SNX has delivered or made available to CSXB a true and correct copy of the Certificate of Incorporation (the “Certificate of Incorporation”), and the Bylaws, or other charter documents, as applicable, of SNX and its subsidiaries, each as amended to date. Neither SNX nor its subsidiaries is in violation of any of the provisions of its respective charter or bylaws or equivalent organization documents. There are no outstanding subscriptions, options, warrants, puts, calls, rights, exchangeable or convertible securities or other commitments or agreements of any character relating to the issued or unissued capital stock or other securities of SNX, or otherwise obligating SNX or its subsidiaries to issue, transfer, sell, purchase, redeem or otherwise acquire any such securities. SNX does not directly or indirectly own any equity or similar interest in, or any interest convertible or exchangeable or exercisable for, any equity or similar interest in, any corporation, partnership, joint venture or other business association or entity.

SECTION 3.02     CAPITALIZATION

There are 100,000,000 shares of SNX capital stock authorized, consisting of 100,000,000 shares of common stock with $0.0001 par value (the “SNX Common Shares”). As of the date of this Agreement, there are 4,000 issued and outstanding SNX Common Shares. No SNX Common Shares have been reserved for issuance to any Person, and there are no outstanding rights, warrants, options or agreements for the exchange of SNX Common Shares. There are no contracts, commitments or agreements relating to voting, purchase or sale of SNX’s capital stock (i) between or among SNX and any of its stockholders and (ii) to the best of SNX’s Knowledge, between or among any of SNX’s stockholders. No Person is entitled to any rights with respect to the conversion, exchange or delivery of the SNX Common Shares. The SNX Common Shares have been issued in compliance with Applicable Law.

SECTION 3.03     AUTHORITY FOR AGREEMENT

The execution, delivery and performance of this Agreement by SNX have been duly authorized by all necessary corporate action, and this Agreement constitutes their valid and binding obligation, enforceable against each of them in accordance with its terms, except as enforceability may be affected by bankruptcy, insolvency or other laws of general application affecting the enforcement of creditors' rights. The execution and consummation of the transactions contemplated by this Agreement and compliance with its provisions by SNX will not violate any provision of Applicable Law and will not conflict with or result in any breach of any of the terms, conditions, or provisions of, or constitute a default under, SNX’s Certificate of Incorporation or Bylaws, in each case as amended, or, to the Knowledge of SNX, in any material respect, any indenture, lease, loan agreement or other agreement instrument to which SNX is a party or by which it or any of its properties are bound, or any decree, judgment, order, statute, rule or regulation applicable to SNX.   No consent, approval, order or authorization of, or registration, declaration or filing with, any court, administrative agency or commission or other Governmental Entity is required by or with respect to SNX in connection with the execution and delivery of this Agreement, or the consummation of the transactions contemplated hereby and thereby, except for (i) the filing of the Certificate of Merger as provided in Section 1.03; (ii) such consents, approvals, orders, authorizations, registrations, declarations and filings as may be required under applicable state securities laws and the securities laws of any foreign country; and (iii) such other consents, authorizations, filings, approvals and registrations which, if not obtained or made, would not have a Material Adverse Effect on SNX and would not prevent, or materially alter or delay any of the transactions contemplated by this Agreement.

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SECTION 3.04     GOVERNMENTAL OR THIRD PARTY CONSENT

No consent, waiver, approval, order or authorization of, or registration, declaration or filing with, any court, administrative agency or commission or other federal, state, county, local or other foreign governmental authority, instrumentality, agency or commission or any third party, including a party to any agreement with SNX, is required by or with respect to SNX in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby, except for such consents, waivers, approvals, orders, authorizations, registrations, declarations and filings as may be required under (i) applicable securities laws, or (ii) the DGCL.

SECTION 3.05     BUSINESS OPERATIONS AND LIABILITIES- SNX.

SNX has conducted no business operations other than the acquisition of ownership of the capital stock of Beijing SNX.

SECTION 3.06     ORGANIZATION AND STANDING – SUBSIDIARIES

Beijing SNX is a corporation duly organized, validly existing and in good standing under the laws of the People’s Republic of China. Beijing SNX  has full power and authority to carry on its business as now conducted and to own and operate its assets, properties and business.

SECTION 3.07     OWNERSHIP OF SUBSIDIARIES

SNX is the owner of one hundred percent (100%) the registered capital stock of Beijing SNX free and clear of all Liens, encumbrances, and restrictions whatsoever. No Person other than SNX has any equity interest in the registered capital of Beijing SNX whether by tender of consideration or otherwise.

SECTION 3.08     CORPORATE RECORDS

All of the books and records of each of the Acquired Entities including, without limitation, its books of account, corporate records, minute book, stock certificate books and other records are up-to-date, complete and reflect accurately and fairly the conduct of its business in all material respects since its date of incorporation. All reports, returns and statements currently required to be filed by any of the Acquired Entities with any government agency with respect to its business and operations have been filed or valid extensions have been obtained in accordance with normal procedures and all governmental reporting requirements have been complied with.

SECTION 3.09     FINANCIAL STATEMENTS – SNX

The consolidated financial statements of SNX for the years ended December 31, 2008 and 2007 and the nine month period ended September 30, 2009 that will be delivered to CSXB prior to the Closing will have been prepared in accordance with accounting principles generally accepted in the United States and will fairly present the financial condition of SNX at the date presented and the results of operations of SNX for the period presented.  The financial statements shall be accompanied by an audit opinion rendered by an independent accountant registered with the PCAOB.

SECTION 3.10     TAXES

Each of the Acquired Entities has filed all Tax Returns that it is required to file with all governmental agencies, wherever situate, and has paid or accrued for payment all Taxes as shown on such returns except for Taxes being contested in good faith. There is no material claim for Taxes that is a Lien against the property of any of the Acquired Entities other than Liens for Taxes not yet due and payable. All Taxes due and owing by any of the Acquired Entities have been paid. None of the Acquired Entities is the beneficiary of any extension of time within which to file any tax return.

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SECTION 3.11     PENDING ACTIONS

There are no material legal actions, lawsuits, proceedings or investigations, either administrative or judicial, pending or threatened, against or affecting any of the Acquired Entities, or against their Officers or Directors that arose out of their operation of any of the Acquired Entities.  None of the Acquired Entities nor any of their Officers or Directors is subject to any order, writ, judgment, injunction, decree, determination or award of any court, arbitrator or administrative, governmental or regulatory authority or body which would be likely to have a Material Adverse Effect on the business of any of the Acquired Entities. There is no injunction, judgment, decree, order or regulatory restriction imposed upon SNX or any of the Acquired Entities or any of their respective assets or business, or, to the knowledge of SNX, any of its respective directors or officers (in their capacities as such), that would prevent, enjoin, alter or materially delay any of the transactions contemplated by this Agreement, or that could reasonably be expected to have a Material Adverse Effect on SNX or any of the Acquired Entities.

SECTION 3.12     INTELLECTUAL PROPERTY AND INTANGIBLE ASSETS

To the Knowledge of SNX, Beijing SNX has full legal right, title and interest in and to all of the intellectual property utilized in the operation of its business. Beijing SNX has not received any written notice that the rights of any other person are violated by the use by Beijing SNX of the intellectual property. None of the intellectual property has ever been declared invalid or unenforceable, or is the subject of any pending or, to the Knowledge of SNX, threatened action for opposition, cancellation, declaration, infringement, or invalidity, unenforceability or misappropriation or like claim, action or proceeding.

SECTION 3.13     COMPLIANCE WITH LAWS

Beijing Shenglongxing Technology co. Ltd.’s operations have been conducted in all material respects in accordance with all applicable statutes, laws, rules and regulations. Beijing Shenglongxing Technologyis not in violation of any law, ordinance or regulation of the People’s Republic of China or of any other jurisdiction. Beijing Shenglongxing Technology holds all the environmental, health and safety and other permits, licenses, authorizations, certificates and approvals of governmental authorities (collectively, the “Permits”) necessary or proper for the current use, occupancy or operation of its business, and all of the Permits are now in full force and effect.

SECTION 3.14     FINDERS’ FEES

Neither SNX nor Beijing SNX has incurred, nor will it incur, directly or indirectly, any liability for brokers’ or finders’ fees or agents’ commissions or investment bankers’ fees or any similar charges in connection with this Agreement or any transaction contemplated hereby.

SECTION 3.15     MINUTE BOOKS

The minute books of the Acquired Entities made available to CSXB contain in all material respects a complete and accurate summary of all meetings of directors and stockholders or actions by written consent of the Acquired Entities during the past three years and through the date of this Agreement, and reflect all transactions referred to in such minutes accurately in all material respects.

SECTION 3.16     VOTE REQUIRED

The approvals of SNX’s Board of Directors and Shareholders are the only approvals or votes necessary to approve this Agreement and the transactions contemplated hereby on behalf of SNX.

SECTION 3.17     BOARD APPOVAL

The Board of Directors of SNX has approved this Agreement and the Merger.

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ARTICLE IV

CERTAIN COVENANTS AND AGREEMENTS

SECTION 4.01     COVENANTS OF SNX

SNX covenants and agrees that, during the period from the date of this Agreement until the Closing Date, other than as contemplated by this Agreement or for the purposes of effecting the Closing pursuant to this Agreement, SNX shall conduct and shall cause Beijing SNX to conduct its business as presently operated and solely in the ordinary course, and consistent with such operation, and, in connection therewith, without the written consent of CSXB, none of the Acquired Entities shall:

(a) Amend its Certificate of Incorporation or Bylaws;

(b) pay or agree to pay to any employee, officer or director compensation that is in excess of the current compensation level of such employee, officer or director other than salary increases or payments made in the ordinary course of business or as otherwise provided in any contracts or agreements with any such employees;

(c) merge or consolidate with any other entity or acquire or agree to acquire any other entity;

(d) sell, transfer, or otherwise dispose of any material assets required for the operations of SNX’s business, except in the ordinary course of business consistent with past practices;

(e) declare or pay any dividends on or make any distribution of any kind with respect to the SNX Shares (provided that Beijing SNX may pay dividends or distributions of any kind to SNX); and

(f) use commercially reasonable efforts to comply with and not be in default or violation under any known law, regulation, decree or order applicable to SNX's business, operations or assets where such violation would have a Material Adverse Effect on SNX.

SECTION 4.02     COVENANTS OF CSXB

CSXB covenants and agrees that, during the period from the date of this Agreement until the Closing Date, CSXB shall, other than as contemplated by this Agreement or for the purposes of effecting the Closing pursuant to this Agreement, conduct its business as presently operated and solely in the ordinary course, and consistent with such operation, and, in connection therewith, without the written consent of SNX shall not:

(a) amend its Articles of Incorporation or Bylaws;

(b) pay or agree to pay to any employee, officer or director compensation of any kind or amount;

(c) merge or consolidate with any other entity or acquire or agree to acquire any other entity;

(d) create, incur, assume, or guarantee any material indebtedness for money borrowed except in the ordinary course of business, or create or suffer to exist any mortgage, Lien or other encumbrance on any of its material assets;

(e) make any material capital expenditure or series of capital expenditures except in the ordinary course of business;

(f) declare or pay any dividends on or make any distribution of any kind with respect to CSXB;

(g) issue any additional shares of CSXB capital stock or take any action affecting the capitalization of CSXB or the CSXB Common Shares; and

(h) grant any severance or termination pay to any director, officer or any other employees of CSXB.

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SECTION 4.03     COVENANTS OF THE PARTIES

(a)   Tax-free Reorganization. The Parties intend that the Merger qualify as a Tax-free “reorganization” under Sections 368(a) of the Code, as amended, and the Parties will take the position for all purposes that the Merger shall qualify as a reorganization under such Section. In addition, the Parties covenant and agree that they will not engage in any action, or fail to take any action, which action or failure to take action would reasonably be expected to cause the Merger to fail to qualify as a Tax-free “reorganization” under Section 368(a) of the Code, whether or not otherwise permitted by the provisions of this Agreement.

(b)   Announcement. Neither SNX, on the one hand, nor CSXB on the other hand, shall issue any press release or otherwise make any public statement with respect to this Agreement or the transactions contemplated hereby without the prior consent of the other Party (which consent shall not be unreasonably withheld), except as may be required by applicable law or securities regulation. Upon execution of this Agreement, CSXB shall issue a press release, which shall be approved by SNX, and file a Current Report on Form 8-K reporting the execution of the Agreement.

(c)   Notification of Certain Matters. SNX shall give prompt written notice to CSXB, and CSXB shall give prompt written notice to SNX, of:

(i)   The occurrence or nonoccurrence of any event the occurrence or nonoccurrence of which would be reasonably likely to cause any representation or warranty contained in this Agreement to be untrue or inaccurate in any material respect at or prior to the Closing Date; and

(ii)   Any material failure of SNX, on the one hand, or CSXB, on the other hand, to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder.

(d)   Reasonable Best Efforts. Before Closing, upon the terms and subject to the conditions of this Agreement, the Parties agree to use their respective reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or advisable (subject to applicable laws) to consummate and make effective the Merger and other transactions contemplated by this Agreement as promptly as practicable including, but not limited to:

(i)   The preparation and filing of all forms, registrations and notices required to be filed to consummate the Merger, including without limitation, any approvals, consents, orders, exemptions or waivers by any third party or governmental entity; and

(ii)   The satisfaction of the Party's conditions precedent to Closing.

(e)   Access to Information

(i)   Inspection by SNX. CSXB will make available for inspection by SNX, during normal business hours and in a manner so as not to interfere with normal business operations, all of CSXB’s records (including tax records), books of account, premises, contracts and all other documents in CSXB’s possession or control that are reasonably requested by SNX to inspect and examine the business and affairs of CSXB. CSXB will cause its managerial employees and regular independent accountants to be available upon reasonable advance notice to answer questions of SNX concerning the business and affairs of CSXB. SNX will treat and hold as confidential any information it receives from CSXB in the course of the reviews contemplated by this Section 4.03(e). No examination by SNX will, however, constitute a waiver or relinquishment by SNX of its rights to rely on CSXB’s covenants, representations and warranties made herein or pursuant hereto.

(ii)   Inspection by CSXB. SNX will, if requested, make available for inspection by CSXB, during normal business hours and in a manner so as not to interfere with normal business operations, all of the Acquired Entities’ records (including tax records), books of account, premises, contracts and all other documents in SNX’s possession or control that are reasonably requested by CSXB to inspect and examine the business and affairs of the Acquired Entities. SNX will cause its managerial employees and regular independent accountants to be available upon reasonable advance notice to answer questions of CSXB concerning the business and affairs of the Acquired Entities. CSXB will treat and hold as confidential any information it receives from SNX in the course of the reviews contemplated by this Section 4.03(e). No examination by CSXB will, however, constitute a waiver or relinquishment by CSXB of its rights to rely on SNX’s covenants, representations and warranties made herein or pursuant hereto.

(f)           CSXB Board of Directors. As promptly as possible after the Closing Date or in accordance with applicable law, all of the officers and members of the board of directors of CSXB shall tender their resignations as officers and directors of CSXB, and the vacancies created on the CSXB board of directors shall be filled by persons designated by the Board of Directors of SNX ten (10) days after the filing and mailing of a Schedule 14F-1.

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ARTICLE V

CONDITIONS PRECEDENT

SECTION 5.01     CONDITIONS PRECEDENT TO THE PARTIES' OBLIGATIONS

The obligations of the Parties as provided herein shall be subject to each of the following conditions precedent, unless waived in writing by both CSXB and SNX:

(a)   Consents, Approvals. The Parties shall have obtained all necessary consents and approvals of their respective boards of directors, and all consents, approvals, permits and authorizations required under their respective charter documents, and all consents, including any material consents and waivers by the Parties’ respective lenders and other third-parties, if necessary, to the consummation of the transactions contemplated by this Agreement.

(b)   Shareholder Approval.  The shareholders of SNX shall have approved the Merger, either at a meeting duly called for that purpose or by written consent with notice duly given to the remainder of the shareholders.

(c)   Assignment and Assumption and Management Agreement.  CSXB, SXAN Holding and Feng Zhenxin shall have executed an Assignment and Assumption and Management Agreement in the form annexed hereto as  Schedule 5.01.

(d)   Absence of Certain Litigation. No action or proceeding shall be threatened or pending before any governmental entity or authority which is likely to result (i) in a restraint, prohibition or the obtaining of damages or other relief in connection with this Agreement or the consummation of the transactions contemplated hereby, or (ii) in limiting or restricting SNX or CSXB’s conduct or operation of the business of SNX or CSXB or any of their subsidiaries, following the Merger.

SECTION 5.02     CONDITIONS PRECEDENT TO THE OBLIGATIONS OF CSXB

The obligations of CSXB on the Closing Date as provided herein shall be subject to the satisfaction, on or prior to the Closing Date, of the following conditions precedent, unless waived in writing by CSXB:

(a)   Representations and Warranties. The representations and warranties by SNX in Article III herein shall be true and accurate in all material respects on and as of the Closing Date with the same force and effect as though such representations and warranties had been made at and as of the Closing Date, except to the extent that any changes therein are specifically contemplated by this Agreement.

(b)   Performance. SNX shall have performed and complied in all material respects with all agreements to be performed or complied with by it pursuant to this Agreement at or prior to the Closing.

(c)   Proceedings and Documents. All corporate, company and other proceedings in connection with the transactions contemplated by this Agreement and all documents and instruments incident to such transactions shall be reasonably satisfactory in substance and form to CSXB and its counsel, and CSXB and its counsel shall have received all such counterpart originals (or certified or other copies) of such documents as they may reasonably request.

(d)   Certificate of Good Standing. SNX shall have delivered to CSXB a certificate as to the good standing of SNX certified by the Secretary of State of the State of Delaware on or within five (5) business days prior to the Closing Date.

(e)   Material Changes. Except as contemplated by this Agreement, since the date hereof, none of the Acquired Entities shall have suffered a Material Adverse Effect, and, without limiting the generality of the foregoing, there shall be no pending litigation to which any of the Acquired Entities is a party which is reasonably likely to have a Material Adverse Effect on any of the Acquired Entities.

(f)   Due Diligence. CSXB shall have satisfactorily completed its due diligence investigation of SNX.

(g)   SEC Filing. No less than one week prior to the Closing, SNX shall have delivered to CSXB the financial statements, report of SNX’s independent registered public accountant, and other information required for inclusion in the Current Report that CSXB will file with the SEC within four business days after the Closing.

(h    Certificate of SNX.  CSXB shall have been provided with a certificate executed on behalf of SNX by its President and Chief Financial Officer certifying that the condition set forth in Section 5.02(b) shall have been fulfilled.

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SECTION 5.03     CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SNX

The obligations of SNX on the Closing Date as provided herein shall be subject to the satisfaction, on or prior to the Closing Date, of the following conditions precedent, unless waived in writing by SNX:

(a)   Representations and Warranties. The representations and warranties by CSXB in Article II herein shall be true and accurate in all material respects on and as of the Closing Date with the same force and effect as though such representations and warranties had been made at and as of the Closing Date, except to the extent that any changes therein are specifically contemplated by this Agreement.

(b)   Performance. CSXB shall have performed and complied in all material respects with all agreements to be performed or complied with by it pursuant to this Agreement prior to or at the Closing.

(c)   Proceedings and Documents. All corporate, company and other proceedings in connection with the transactions contemplated by this Agreement and all documents and instruments incident to such transactions shall be reasonably satisfactory in substance and form to SNX and its counsel, and SNX and its counsel shall have received all such counterpart originals (or certified or other copies) of such documents as they may reasonably request.

(d)   Certificates of Good Standing. CSXB shall have delivered to SNX a certificate as to its good standing in the State of Nevada, in each case certified by the Secretary of State not more than five (5) business days prior to the Closing Date.

(e)   Material Changes. Except as contemplated by this Agreement, since the date hereof, CSXB shall not have suffered a Material Adverse Effect and, without limiting the generality of the foregoing, there shall be no pending litigation to which CSXB is a party which is reasonably likely to have a Material Adverse Effect on CSXB.

(f)   Due Diligence. SNX shall have satisfactorily completed its due diligence investigation of CSXB.

(g)   Status of CSXB. As at the Effective Time of the Merger, CSXB (i) shall be a fully compliant reporting public company under the Exchange Act, and shall be current in all of its reports required to be filed under the Exchange Act, (ii) shall not have been threatened or subject to delisting from the OTC Bulletin Board, and (iii) shall have outstanding no more than 20,073,237 CSXB Common Shares; and there shall be no other CSXB Common Shares outstanding nor, except as provided hereunder, any options, warrants or rights to acquire capital stock of CSXB whether for additional consideration or on conversion.

(h)   Certificate of CSXB.  SNX shall have been provided with a certificate executed on behalf of CSXB by its President and Chief Financial Officer certifying that the condition set forth in Section 5.03(b) shall have been fulfilled.

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ARTICLE VI

TERMINATION

SECTION 6.01     TERMINATION

This Agreement may be terminated and the Merger may be abandoned at any time prior to the Closing Date by:

(a)   The mutual written consent of the Boards of Directors of CSXB and SNX;

(b)   Either CSXB, on the one hand, or SNX, on the other hand, if any governmental entity or court of competent jurisdiction shall have issued an order, decree or ruling or taken any other action (which order, decree, ruling or other action the Parties shall use their commercially reasonable best efforts to lift), which restrains, enjoins or otherwise prohibits the Merger or the issuance of the Merger Shares as contemplated herein and such order, decree, ruling or other action shall have become final and non-appealable;

(c)   CSXB, if SNX shall have breached in any material respect any of its representations, warranties, covenants or other agreements contained in this Agreement, and the breach cannot be or has not been cured within thirty (30) calendar days after the giving of written notice by CSXB to SNX, or by CSXB, if it is not satisfied with the results of its due diligence investigation and it so notifies SNX;

(d)   SNX, if CSXB shall have breached in any material respect any of its representations, warranties, covenants or other agreements contained in this Agreement, and the breach cannot be or has not been cured within thirty (30) calendar days after the giving of written notice by SNX to CSXB, or by SNX if it is not satisfied with the results of its due diligence investigation and it so notifies CSXB; or

(e)   Without any action on the part of the Parties if required by Applicable Law or if the Closing shall not be consummated by January 31, 2010, unless extended by written agreement of CSXB and SNX.

SECTION 7.02     EFFECT OF TERMINATION

If this Agreement is terminated as provided in Section 7.01, written notice of such termination shall be given by the terminating Party to the other Party specifying the provision of this Agreement pursuant to which such termination is made, this Agreement shall become null and void and there shall be no liability on the part of CSXB or SNX, provided, however, that (a) the provisions of Article VIII hereof shall survive the termination of this Agreement; (b) nothing in this Agreement shall relieve any Party from any liability or obligation with respect to any willful breach of this Agreement; and (c) termination shall not affect accrued rights or liabilities of any party at the time of such termination.

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ARTICLE VII

CONFIDENTIALITY

SECTION 7.01     CONFIDENTIALITY

The Parties shall keep confidential all information and documents obtained from the other, including but not limited to any information or documents provided pursuant to Section 4.03(e) hereof (except for any information disclosed to the public pursuant to a press release authorized by the Parties); and in the event the Closing does not occur or this Agreement is terminated for any reason, will promptly return such documents and all copies of such documents and all notes and other evidence thereof, including material stored on a computer, and will not use such information for its own advantage, except to the extent that (i) the information must be disclosed by law, (ii) the information becomes publicly available by reason other than disclosure by the Party subject to the confidentiality obligation, (iii) the information is independently developed without use of or reference to the other Party’s confidential information, (iv) the information is obtained from another source not obligated to keep such information confidential, or (v) the information is already publicly known or known to the receiving Party when disclosed as demonstrated by written documentation in the possession of such Party at such time.

ARTICLE VIII

INDEMNIFICATION

SECTION 8.01     INDEMNIFICATION BY CSXB

CSXB agrees to indemnify, defend and hold harmless each of SNX, any subsidiary or affiliate thereof and each person who is now, or has been at any time prior to the date hereof or who becomes prior to the Closing, a shareholder, officer, director or partner of SNX, any subsidiary or affiliate thereof or an employee of SNX, any subsidiary or affiliate thereof and their respective heirs, legal representatives, successors and assigns (the “SNX Indemnified Parties”) against all losses, claims, damages, costs, expenses (including reasonable attorneys’ fees), liabilities or judgments or amounts that are paid in settlement of or in connection with any threatened or actual third party claim, action, suit, proceeding or investigation based in whole or in part on or arising in whole or in part out of (i) any material breach of this Agreement by CSXB, or any subsidiary or affiliate thereof, including but not limited to failure of any representation or warranty to be true and correct at or before the Closing, or (ii) any willful or grossly negligent act, omission or conduct of any officer, director or agent of CSXB or any subsidiary or affiliate thereof prior to the Closing, whether asserted or claimed prior to, at or after, the Closing. Any SNX Indemnified Party wishing to claim indemnification under this Section 8.01, upon learning of any such claim, action, suit, proceeding or investigation, shall notify CSXB in writing, but the failure to so notify shall not relieve CSXB from any liability that it may have under this Section 8.01, except to the extent that such failure would materially prejudice CSXB.

SECTION 8.02 INDEMNIFICATION BY SNX

SNX shall indemnify, defend and hold harmless each of CSXB, any subsidiary or affiliate thereof and each person who is now, or has been at any time prior to the date hereof or who becomes prior to the Closing, a shareholder, officer, director or partner of CSXB, any subsidiary or affiliate thereof or an employee of CSXB, any subsidiary or affiliate thereof and their respective heirs, legal representatives, successors and assigns (the “CSXB Indemnified Parties”) against all losses, claims, damages, costs, expenses (including reasonable attorneys fees), liabilities or judgments or amounts that are paid in settlement of or in connection with any threatened or actual third party claim, action, suit, proceeding or investigation based in whole or in part on or arising in whole or in part out of (i) any material breach of this Agreement by SNX or any subsidiary or affiliate thereof, including but not limited to failure of any representation or warranty to be true and correct at or before the Closing, or (ii) any willful or negligent act, omission or conduct of any officer, director or agent of SNX or any subsidiary or affiliate thereof prior to the Closing, whether asserted or claimed prior to, at or after, the Closing. Any CSXB Indemnified Party wishing to claim indemnification under this Section 8.02, upon learning of any such claim, action, suit, proceeding or investigation, shall notify SNX in writing, but the failure to so notify shall not relieve SNX from any liability that it may have under this Section 8.02, except to the extent that such failure would materially prejudice SNX.

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ARTICLE IX

MISCELLANEOUS

SECTION 9.01 EXPENSES

All costs and expenses incurred in connection with this Agreement and the consummation of the transactions contemplated by this Agreement shall be paid by the Party incurring such expenses.

SECTION 9.02 APPLICABLE LAW

This Agreement shall be governed by the laws of the State of Nevada, without giving effect to the principles of conflicts of laws thereof, as applied to agreements entered into and to be performed in such state.

SECTION 9.03 NOTICES

All notices and other communications under this Agreement shall be in writing and shall be deemed to have been duly given or made as follows:

(a)   If sent by reputable overnight air courier (such as Federal Express), one business day after being sent;

(b)   If sent by facsimile transmission, with a copy mailed on the same day in the manner provided in clause (a) above, when transmitted and receipt is confirmed by the fax machine; or

(c)   If otherwise actually personally delivered, when delivered.

All notices and other communications under this Agreement shall be sent or delivered as follows:

If to SNX, to:

Jennifer Y. Chen

SNX Organic Fertilizers, Inc.

18 Kimberly Court

East Hanover, NJ 07936

Telephone: 973-462-8777

with a copy to (which shall not constitute notice):

Robert Brantl, Esq.

52 Mulligan Lane

Irvington, NY 10533

914-693-3026

914-693-1807 (fax)

If to CSXB, to:

Feng Zhenxing

Three-Kilometer Spot Along the Hayi Highway

Tieli City, Heilongjiang Province, P.R. China

Telephone Number: (86)-458-238688

 With a copy to (which shall not constitute notice):

American Union Securities, Inc.

100 Wall Street, 15th Floor

New York, NY 10005

Telephone: 212-232-0120

Facsimile: 212-785-5867

Each Party may change its address by written notice in accordance with this Section.

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SECTION 9.04 ENTIRE AGREEMENT

This Agreement (including the documents and instruments referred to in this Agreement) contains the entire understanding of the Parties with respect to the subject matter contained in this Agreement, and supersedes and cancels all prior agreements, negotiations, correspondence, undertakings and communications of the Parties, oral or written, respecting such subject matter.

SECTION 9.05 ASSIGNMENT

Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned by any of the Parties (whether by operation of law or otherwise) without the prior written consent of the other Parties; provided that in no event may the right to indemnification provided by Article VIII hereto be assigned by any of the Parties, with or without consent, except by operation of law. Subject to the immediately foregoing sentence of this Section 9.05, this Agreement will be binding upon, inure to the benefit of and be enforceable by, the Parties and their respective successors, assigns, heirs and representatives.

SECTION 9.06 COUNTERPARTS

This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which shall be considered one and the same agreement.

SECTION 9.07 NO THIRD PARTY BENEFICIARIES

Except as expressly provided by this Agreement, nothing herein is intended to confer upon any person or entity not a Party to this Agreement any rights or remedies under or by reason of this Agreement.

IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first above written.

CHINA SXAN BIOTECH, INC..

By:	/s/ Feng Zhenxing
Name:	Feng Zhenxing
Title:	Chief Executive Officer

SNX ORGANIC FERTILIZERS, INC.

By:	/s/ Jennifer Y. Chen
Name:	Jennifer Y. Chen
Title:	Chief Executive Officer

Schedules:

1.01  Certificate of Designation of Series C Preferred Stock

5.01  Assignment and Assumption and Management Agreement

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EX-10.B

ASSIGNMENT AND ASSUMPTION

and

MANAGEMENT AGREEMENT

This Assignment and Assumption and Management Agreement (this “Agreement”) is made and entered into on January 15, 2010, by and among the following parties (each, a “Party” and collectively, the “Parties”):  China SXAN Biotech, Inc., a Nevada corporation (the “Company”), American SXAN Biotech, Inc., a Delaware corporation (the “Subsidiary”) , Feng Zhenxin (the “Manager”), and Feng Guowu and Yi Kang (the “Shareholders”).

WHEREAS, the Subsidiary is a wholly-owned subsidiary of the Company that is engaged in the business of growing forest frogs for pharmaceutical purposes in the People’s Republic of China; and

WHEREAS, the Company has contracted to acquire a subsidiary engaged in the business of manufacturing organic fertilizer, and wishes to divest itself of the Subsidiary; and

WHEREAS, the Manager and the Shareholders, who have served as management of the Subsidiary, wish to continue to control the Subsidiary.

NOW, THEREFORE, in consideration of the mutual promises made herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows:

ARTICLE 1:  TRANSFER AND ASSIGNMENT OF ASSETS

On the terms and subject to the conditions herein expressed, the Company hereby sells, conveys, transfers, assigns, sets over and delivers to Subsidiary at the Time of Closing (as defined in Section 3.1), and Subsidiary assumes and accepts, all of the assets, rights and interests, tangible and intangible, of every kind, nature and description, then owned, possessed or operated by Company, wheresoever situate (collectively, the “Assets”), including without limitation the following:

1.1                 Intangible Property.  All intangible assets of Company which are transferable including, but not limited to, customer and supplier lists, privileges, permits, licenses, software and software licenses, certificates, commitments, goodwill, registered and unregistered patents, trademarks, service marks and trade names, and applications for registration thereof and  the goodwill associated therewith;

1.2Cash and Accounts Receivable.  All accounts receivable, deposit accounts, cash and cash equivalents and securities owned by the Company ;

1.3Claims. Claims made in lawsuits and other proceedings filed by the Company, judgments and settlements in the Company’s favor, rights to refunds, including rights to and claims for federal and state income and franchise tax refunds and refunds of other taxes paid based upon or measured by income prior to the Closing, and insurance policies and rights accrued thereunder.

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ARTICLE 2:  ASSUMPTION OF LIABILITIES

2.1Scope of Liabilities Assumed.  The Subsidiary shall assume, pay, perform or discharge the following:

a.   any and all debts, liabilities or obligations of any nature of the Company or the Subsidiary, whether contingent or fixed and whether known or unknown, which have accrued at the Time of Closing.

b.   any and all debts, liabilities or obligations of any nature of the Subsidiary, whether contingent or fixed and whether known or unknown, arising either before or after the Time of Closing.

The Subsidiary shall promptly provide for payment, performance and discharge of the same in accordance with their terms. The Manager agrees personally and unconditionally to guarantee performance of the obligations assumed by the Subsidiary as described herein.

ARTICLE 3:  THE CLOSING

3.1The Closing.  The closing of the transactions contemplated in this Agreement (“Closing”) shall take place simultaneously with the closing of the transactions contemplated under the Merger Agreement among the Company, SNX Acquisition Corp. and SNX Organic Fertilizers, Inc.    The effective time of closing is referred to herein as the “Time of Closing.”

3.2Deliveries by Company.  At Closing, Company shall deliver to Subsidiary, in addition to all other items specified elsewhere in this Agreement, the following:

(a)Such instruments of sale, conveyance, transfer, assignment, endorsement, direction or authorization as will be required or as may be desirable to vest in Subsidiary, its successors and assigns, all right, title and interest in and to the Assets, subject to any and all mortgages, pledges, liens, encumbrances, equities, charges, conditional sale or other title retention agreements, assessments, covenants, restrictions, reservations, commitments, obligations, or other burdens or encumbrances of any nature whatsoever that exist at the Time of Closing;

(b)All of the files, documents, papers, agreements, books of account and records pertaining to the Assets;

(c)Actual possession and operating control of the Assets;  and

(d)To the extent required, the consents of third parties to the assignment and transfer of any of the Assets.

3.3Deliveries by Subsidiary.  At Closing, the Subsidiary shall deliver to the Company any  instruments, in addition to this Agreement, as the Company deems necessary or desirable fully to secure the assumption by the Subsidiary, its successors and assigns, of all liabilities and obligations of the Company, as described Section 2.1 hereof.

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ARTICLE 4:  COVENANTS ON AND SUBSEQUENT TO THE CLOSING DATE

On and after the Closing Date, Subsidiary and Company (as the case may be) covenant as follows:

4.1Pay Creditors.  Following the Closing, Subsidiary shall pay all payables and other obligations of Company assumed hereunder by the Subsidiary, as such obligations become due in the ordinary course of business.

4.2Lawsuits.  Without limiting the generality of Section 2.01, following the Closing, the Subsidiary shall continue the defense of any and all lawsuits or other claims filed or threatened against the Company.

4.3Insurance Policies.  Subsidiary shall name the Company as an additional insured on all insurance policies transferred by the Company or any other insurance policies covering the period prior to the Time of Closing, and Subsidiary shall provide proof of such coverage to the Company upon request.

4.4Right to Inspect Records. The Subsidiary shall permit the Company and its agents to have reasonable access to the books and accounts of the Subsidiary (at the expense of the Company) for the purpose of filing tax returns, preparing filings required by the Securities and Exchange Commission, and all other legitimate purposes.

4.5Execution of Further Documents.   Upon the request of either party, the other party shall execute, acknowledge and deliver all such further acts, deeds, bills of sale, assignments, assumptions, undertakings, transfers, conveyances, title certificates, powers of attorney and assurances as may be required , in the case of Subsidiary, to convey and transfer to, and vest in, Subsidiary all of Company’s right, title and interest in the Assets, and in the case of the Company, to secure the assumption by Subsidiary of the Company’s obligations and liabilities arising as of the Time of Closing.

4.6Change of Corporation Name.  Promptly after the Closing and, in any case, no later than December 31, 2010, the Company shall change its corporate name to a name that does not include the word “SXAN.”

ARTICLE 5:MANAGEMENT AND OPERATION OF SUBSIDIARY

5.1Titles. The Subsidiary hereby engages the Manager to manage and operate its business.  The Manager shall serve as the sole member of the Board of Directors of the Subsidiary, and the Manager shall have the titles of President and Secretary, subject to the right of the Board of Directors of the Subsidiary to appoint additional officers.

5.2Duties.                 The Manager agrees that he will manage and operate the business of the Subsidiary to the best of his abilities and will devote such time and effort as necessary to fulfill his duties under this Agreement.

5.3Management of Subsidiary.  The Company agrees that the Manager will have exclusive authority over the operations of the Subsidiary, except that the Company shall be entitled to intervene in the event that a breach of the covenants in this Agreement or any conduct by the Manager in the course of operating the Subsidiary threatens the Company with material harm or material liability of any kind.  (In any such event, the Company shall be entitled to remove the directors and officers of the Subsidiary and to elect a new Board of Directors.)    The Manager shall maintain such books and records of the operations of the Subsidiary as are required by the Rules of the SEC, and shall prepare quarterly and annual financial statements promptly so as to permit the Company to file periodic reports with the SEC according to SEC Rules

5.4Company’s Covenants.  The Company shall not cause any funds or assets of the Subsidiary to be paid or transferred to the Company, nor shall the Company cause the Subsidiary to issue any capital stock of any class or series or any options, warrants or rights to acquire capital stock of the Subsidiary whether for additional consideration or on conversion.

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5.5                 Options to Purchase the Subsidiary.  The Company hereby grants to the Manager and the Shareholders (collectively, the “Purchasers”) an irrevocable option to acquire all of the capital stock of the Subsidiary (the “Call Option”).  The Purchasers hereby grant to the Company an irrevocable option to cause the Purchasers to acquire all of the capital stock of the Subsidiary (the “Put Option”).  Upon exercise of either option, the capital stock of the Subsidiary will be exchanged for six million six hundred thousand (6,600,000) shares of the Company’s common stock (the “Exchange Shares”), to be delivered as follows:  Feng Zhenxin - 5,000,000 shares; Feng Guowu - 800,000 shares; Yi Kang - 800,000 shares.  The Purchasers may exercise the Call Option by giving written notice to the Company, or the Company may exercise the Put Option by giving written notice to the Manager, said notice in either case being effective seven days after delivery.  On the effective date of the exercise of the option, the Purchasers shall deliver to the Company certificates for the Exchange Shares duly endorsed for transfer to the Company,  and the Company shall deliver to the Purchasers certificates for the capital stock of the Subsidiary duly endorsed in blank.

ARTICLE 6: INDEMNIFICATION

6.1Indemnification by Subsidiary and Manager.  From and after the Closing, the Subsidiary and the Manager shall, jointly and severally, indemnify and save the Company, its officers and directors, and their respective successors, assigns, heirs and legal representatives (“Company Indemnitees”) harmless from and against any and all losses, claims, damages, liabilities, costs, expenses or deficiencies including, without limitation, actual attorneys’ fees and other costs and expenses incident to proceedings or investigations or the defense or settlement of any claim, incurred by or asserted against any Company Indemnitee due to or resulting from a violation or default by Subsidiary with respect to any of Subsidiary’s covenants, obligations or agreements hereunder and any losses or expenses incurred in connection with, or payment by Company of the debts, liabilities and obligations assumed by the Subsidiary hereunder or the debts, liabilities and obligations of the Subsidiary arising after the Time of Closing.

6.2Indemnification Procedures.

(a)The party seeking indemnification (“Indemnified Party”) shall give the indemnifying party (“Indemnifying Party”) notice (a “Claim Notice”) of its indemnification claim which notice shall (i) be in writing, (ii) include the basis for the indemnification, and (iii) include the amount Indemnified Party believes is the amount to be indemnified, if reasonably possible.

(b) Indemnifying Party shall be deemed to accept Indemnified Party’s claim unless, within twenty (20) business days after receipt of any Claim Notice, Indemnifying Party delivers to Indemnified Party notice of non-acceptance of the indemnification claim, which must (a) be in writing and (b) include the basis for the disagreement.

(c) The parties shall attempt in good faith to resolve any issues concerning liability and the amount of such claim, and any issues which they cannot resolve within thirty (30) days after delivery of the notice of non-acceptance pursuant to Section 6.2(b) shall be settled by arbitration in accordance with the rules of the American Bar Association, by a sole arbitrator located in New York, NY or such other location as the parties shall agree, whose determination shall be final and binding on the parties hereto.  The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. §§ 1-16, and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.  The arbitrator shall have the authority to award legal fees, arbitration costs and other expenses, in whole or in part, to the prevailing party.

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ARTICLE 7:  MISCELLANEOUS

7.1  Benefit.  This Agreement shall be binding upon, and inure to the benefit of, the Parties hereto and their respective successors, assignees, heirs and legal representatives.

7.2Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

7.3Amendment, Modification and Waiver.    Any Party hereto may waive in writing any term or condition contained in this Agreement and intended to be for its benefit; provided, however, that no waiver by any Party, whether by conduct or otherwise, in any one or more instances, shall be deemed or construed as a further or continuing waiver of any such term or condition.  Each amendment, modification, supplement or waiver shall be in writing and signed by the Party or Parties to be charged.

7.4Entire Agreement.  This Agreement and the exhibits, schedules and other documents expressly provided hereunder or delivered herewith represent the entire understanding of the parties.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on Janaury 15, 2010.

CHINA SXAN BIOTECH, INC.	AMERICAN SXAN BIOTECH, INC.
By: /s/ Feng Zhenxing	By: /s/ Feng Zhenxing
Feng Zhenxing, Chief Executive Officer	Feng Zhenxing, Chief Executive Officer
/s/ Feng Guowu	By: /s/ Feng Guowu
Feng Guowu	Feng Guowu
/s/ Yi Kang
Yi Kang

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