F-1

Registration No. 333-

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM F-1

REGISTRATION STATEMENT

UNDER THE SECURITIES ACT OF 1933

GRAND FARM INC.

(Exact name of Registrant as specified in its charter)

Cayman Islands	2040	Not Applicable
(State or other jurisdiction of	(Primary Standard Industrial	(I.R.S. Employer
incorporation or organization)	Classification Code Number)	Identification Number)

No.2089 East Hanhua Road

Guohuan Town, Hanjiang District

Putian, Fujian Province, China 351111

Phone: +86-594-3599889

Fax: +86-594-3598158

(Name, address, including zip code, and telephone number

including area code, of registrant’s principal executive office)

Puglisi & Associates

850 Library Avenue, Suite 204

Newark, Delaware 19711

Tel: (302) 738-7210

(Name, address, including zip code, and telephone number

including area code, of agent for service)

Copies to:

Kevin K. Leung, Esq.	Mitchell S. Nussbaum, Esq.
Young Jun Kim, Esq. Francis Chen, Esq. LKP Global Law, LLP	Angela M. Dowd, Esq. Loeb & Loeb LLP 345 Park Avenue,
1901 Avenue of the Stars, Suite 480 Los Angeles, California 90067 Tel: 424-239-1890  Fax: 424-869-6692	New York, New York 10154 Tel: 212-407-4000  Fax: 212-407-4990
José Santos, Esq. Forbes Hare Elizabethan Square Grand Cayman KY1-1103  Cayman Islands Tel: 1 345 943 7700  Fax: 1 345 943 7702

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.¨

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to Be Registered(1)	Proposed Maximum Aggregate Offering Price (2) (3)		Amount of Registration Fee (3)
Ordinary shares, par value $0.002 per share	$	30,000,000	$	3,483.00
Underwriter’s warrants to purchase ADSs (4) (5)
Ordinary shares underlying underwriter’s warrants (5)
Total registration fee			$	3,483.00

(1) American depositary shares, or ADSs, issuable upon deposit of the ordinary shares registered hereby will be registered under a separate registration statement on Form F-6.  Each ADS represents       ordinary shares.

(2) Includes ordinary shares underlying ADSs that are issuable upon the exercise of a 45-day underwriters’ option to purchase additional ADSs solely to cover over-allotments, if any.

(3) Estimated solely for the purposes of computing the amount of the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended.

(4) Pursuant to Rule 416 under the Securities Act of 1933, as amended, there are also being registered an indeterminable number of our ordinary shares as may be issued to prevent dilution as a result of stock splits, stock dividends or similar transactions.

(5) The Registrant will issue to the underwriter (or its designated affiliates) warrants to purchase a number of ADSs that is equal to 7% of the aggregate number of ADSs sold in this offering, including the over-allotment option.  The warrants will be exercisable at a per ADS exercise price equal to 150% of the public offering price, and may be exercised on a cashless basis.  Pursuant to Rule 457(g) under the Securities Act of 1933, as amended, because the ordinary shares underlying the underwriter’s warrants are registered hereby, no separate registration fee is required with respect to the warrants registered hereby.

The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission, acting pursuant to the said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED        , 2011

GRAND FARM INC.

American Depositary Shares Representing Ordinary Shares

This is the initial public offering of American depositary shares, or ADSs, of Grand Farm Inc., or Grand Farm Cayman.  Grand Farm Cayman is offering       ADSs.  Each ADS represents       of our ordinary shares, par value $0.002 per share.

Prior to this offering, there has been no public market for our ADS or our ordinary shares.  We currently expect the initial public offering price to be between $      and $      per share.

We have applied to list our ADSs on the NASDAQ Capital Market under the symbol “GRFM.”  There is no assurance that this application will be approved.  If the application is not approved, we will not complete this offering.

See “Risk Factors” beginning on page 10 to read about risks you should consider before buying our ADSs.

Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this registration statement. Any representation to the contrary is a criminal offense.

No offer or invitation to subscribe for the ADSs may be made to the public in the Cayman Islands.

	Per ADS	Total
Public offering price	$	$
Underwriting discount	$	$
Corporate finance fee	$	$
Proceeds, before expenses, to us	$	$

The underwriter has an option exercisable within 45 days from the date of this prospectus to purchase up to       of additional ADSs from us at the public offering price, less the underwriting discount, solely to cover over-allotments. The ADSs issuable upon exercise of the underwriter’s over-allotment option have been registered under the registration statement of which this prospectus forms a part.

In consideration of services provided, we have also agreed to issue to the underwriter (or its designated affiliates) warrants to purchase up to       ADSs equal to 7% of the number of ADSs sold in this offering, including the over-allotment option, exercisable six months after the closing of this offering and expiring five years from the effective date of the registration statement of which this prospectus forms a part.  If these warrants are exercised, each ADS may be purchased at $      (150% of the initial offering price per ADS sold in the offering), and the warrants may be exercised on a cashless basis.

The underwriter expects to deliver the ADSs against payment in U.S. dollars in New York, New York on      , 2011.

 Newbridge Securities Corporation

Prospectus dated      , 2011.

Grand Farm’s pre-packaged short/medium-shaped rice products

Grand Farm’s second production facility in Putian

Grand Farm’s rice bran oil storage silos and production facility located at its second production facility in Putian

TABLE OF CONTENTS

Prospectus

PROSPECTUS SUMMARY	1
RISK FACTORS	10
FORWARD-LOOKING STATEMENTS	32
USE OF PROCEEDS	33
DIVIDEND POLICY	34
CAPITALIZATION	35
DILUTION	36
EXCHANGE RATE INFORMATION	37
ENFORCEABILITY OF CIVIL LIABILITIES	38
SELECTED FINANCIAL AND OPERATING DATA	39
OPERATING AND FINANCIAL REVIEW AND PROSPECTS	40
OUR CORPORATE HISTORY AND STRUCTURE	51
OUR BUSINESS	56
REGULATION	64
DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES	74
MAJOR SHAREHOLDERS	78
RELATED PARTY TRANSACTIONS	79
DESCRIPTION OF SHARE CAPITAL	81
DESCRIPTION OF AMERICAN DEPOSITARY SHARES	89
SHARES ELIGIBLE FOR FUTURE SALE	97
TAXATION	98
UNDERWRITING	110
EXPENSES RELATING TO THIS OFFERING	119
LEGAL MATTERS	120
EXPERTS	120
WHERE YOU CAN FIND ADDITIONAL INFORMATION	120
COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES	120
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS	F-1

No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus. You must not rely on any unauthorized information or representations. This prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is accurate only as of its date.  To the extent that any fact or event arising after the date of this prospectus represents, individually or in the aggregate, a fundamental change in the information presented in this prospectus, this prospectus will be updated to the extent required by law.

i

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by, and should be read in conjunction with the more detailed information and financial statements appearing elsewhere in this prospectus. In addition to this summary, we urge you to read the entire prospectus carefully, especially the risks of investing in our ADSs discussed under “Risk Factors” beginning on page 10 before deciding whether to buy our ADSs.

Conventions That Apply to this Prospectus

In this prospectus, unless otherwise specified or the context so requires:

“ADSs” refers to our American depositary shares, each of which represents       ordinary shares;

“ordinary shares” refers to Grand Farm Inc.’s ordinary shares, par value $0.002 per share;

“we,” “us,” “our company,” or “Company” refers to Grand Farm Inc., and its subsidiaries and consolidated entities;

“Sunlight Blaze” refers to Sunlight Blaze Holdings Limited, a British Virgin Islands company;

“Grand Farm Cayman” refers to Grand Farm Inc., a Cayman Islands exempted company;

“Grand Farm HK” refers to Asia Success Holdings Limited, a Hong Kong company, which is a wholly owned subsidiary of Grand Farm Cayman;

“Grand Farm WFOE” refers to Putian Asia Success Cereals & Oils Technical Service Co., Ltd., a PRC company which is a wholly owned subsidiary of Grand Farm HK;

“Grand Farm China” refers to Fujian Grand Farm Foods Development Co., Ltd., a PRC company which has contractual relationships with Grand Farm WFOE;

“PRC” or “China” refers to the People’s Republic of China, and, for the purposes of this prospectus, excludes Hong Kong, Macau and Taiwan;

“RMB” or “¥” refers to the legal currency of the People’s Republic of China;

“U.S. dollars,” “US$” or “$” refers to the legal currency of the United States;

“mt” refers to metric ton or metric tons;

“kg” refers to kilogram or kilograms; and

“m2” refers to square meter or square meters.

Unless otherwise indicated, all information in this prospectus reflects no exercise by the underwriters of their option to purchase up to       additional ADSs to cover over-allotments, if any.  Unless otherwise indicated, our financial information presented in this prospectus has been prepared in accordance with United States Generally Accepted Accounting Principles, or US GAAP.  This prospectus contains conversions of Renminbi amounts into U.S. dollars at specified rates solely for the convenience of the reader.

Unless otherwise noted, all conversions from Renminbi to U.S. dollars were made at the noon buying rate in the City of New York for cable transfers in Renminbi per U.S. dollar as certified for customs purposes by the Federal Reserve Bank of New York, or the noon buying rate, as of December 31, 2010, which was RMB 6.61180 to US$1.00.  We make no representation that the Renminbi or U.S. dollar amounts referred to in this prospectus could have been or could be converted into U.S. dollars or Renminbi, as the case may be, at any particular rate or at all. On May 10, 2011, the noon buying rate was RMB 6.50130 to US$1.00.

Our Business

We are a leading integrated rice producer in China.  Established in June 2001, we are headquartered in Putian, Fujian Province.  All of our business operations are conducted by Grand Farm China, which we control through a series of contractual arrangements between Grand Farm WFOE, our wholly-owned indirect subsidiary, and Grand Farm China together with its owners.  For a description of the contractual arrangements, please see “Our Corporate History and Structure – Contractual Arrangements with Grand Farm China and its Equity Owners” elsewhere this prospectus.

1

We currently produce three types of milled rice that we prepackage and sell under the “Grand Farm” brand to our distributors for wholesale and retail distributions throughout Fujian.  We produce regular milled rice and nutrient-fortified rice from short/medium-shaped grain primarily sourced from northeastern China – Panjin in Liaoning Province, Bayan in Heilongjiang Province, and Jilin City and Dehui in Jilin Province.  We also produce regular milled rice from long-shaped rice grain sourced from Fujian Province and Jiangxi Province in southern China to cater to consumers who may prefer a different taste and texture than rice made from short/medium-shaped grain, and to diversify our product offerings.  All three types of prepackaged milled rice products are consumed by the Chinese consumers as daily staples.  In addition to our prepackaged rice products, we produce milled rice from long-shaped rice grains that we sell in bulk directly to brewers throughout Fujian to make beer.  Byproducts from our rice milling process, such as rice bran and broken rice, are sold in bulk directly to livestock feed factories and stores.  Our net income for the years ended December 31, 2008, 2009 and 2010 was approximately $4.9 million, $12.1 million and $14.1 million, respectively.

We currently have two production facilities both in Putian.  The first facility is located at our headquarters and has two processing lines with combined annual rice grain processing capacity of 260,000 mt, yielding 180,000 mt of milled rice, as well as our proprietary production line for nutrient-fortified rice with annual production capacity of 80,000 mt.  Our entire production process at this facility, from sourcing raw materials to production to sales, is ISO9001:2000 certified (for quality control), HACCP certified (for food safety control), and ISO14001:2004 certified (for environment control).  Our second facility, located in proximity to our headquarters, houses an integrated refined rice bran oil production line with 24,000 mt in annual production capacity.  Oil will largely be produced from the rice bran that we currently sell for livestock feed.  We commenced trial production in October 2010 and produced a limited quantity of unrefined, or crude, rice bran oil, which is not suitable for consumption, and expect formal production of refined rice bran oil to commence immediately after we receive a Production License from the Administration of Quality Inspection of Fujian Province, which we are in the process of applying for.  If our application process is successful, in addition to the issuance of the Production License, our refined rice bran oil will carry a “QS” (quality safety) label when it is introduced into the market, signifying that we are properly licensed.  We currently anticipate completing the application process and obtaining the Production License by the end of May 2011, and to commence formal production of refined rice bran oil immediately thereafter.  The timing and results of the application process, however, are ultimately beyond our control, and there is no assurance when we will be issued the Production License, if at all.

The second facility will also house another rice production line with projected annual rice grain processing capacity of 90,000 mt, yielding approximately 60,000 mt of milled rice.  Because the building that this production line will occupy requires modifications to accommodate our equipment, we are in the process of registering the plan for the modifications with the Putian Development and Reform Commission, and allowing the Putian Environmental Protection Bureau complete an environmental impact study in connection with such modifications.  We currently expect to complete these steps in May 2011, the modifications to the building in September 2011 and the installation of the production line by the end of 2011, and to commence formal production immediately thereafter.

Industry Background and Market Opportunity

China’s Rice Industry

World rice grain output has grown steadily over the past five years. According to the statistics from the U.N. Food and Agriculture Organization, or FAO, global rice grain output reached 689 million mt, equivalent to 460 million mt of milled rice, in 2009.  According to FAO, Asia alone accounts for over 90% of the total global rice grain output – reaching 623 million mt. in 2009 – and is also the largest rice consumption region.  Of that amount, China accounted for 195 million mt, according to the China National Grain and Oils Information Center, or CNGOIC, and the National Bureau of Statistics of China, or NBS, up from 192 million mt in 2008 and 186 million mt in 2007, making it the world’s largest rice grain producer.  With over 60% of its population relying on rice as their staple food source according to FAO, China is also the world’s largest rice consumer, reaching 182 million mt, equivalent to 127 million mt of milled rice, in 2009 as reported by CNGOIC.

Based on internal research, we believe that most Chinese consumers currently buy rice in bulk, and we estimate that approximately 40 million mt of rice were sold pre-packaged (generally 25 kilograms per bag or less) in 2008, less than 30% of the total national rice consumption.  Pre-packaged rice is generally less prone to mold and insect infestation, and easier to maintain freshness, according to a study by the Institute of Qiaoxing Light Industry of Fuzhou University.  Coupled with the convenience of smaller packaging, we believe that Chinese consumers should generally prefer pre-packaged rice, despite its higher price point, over rice sold in bulk.  If China’s urbanization and disposable income levels continue to rise as they have in recent history, we expect pre-packaged rice to eventually overtake bulk rice in consumer preference, especially in the more developed coastal regions of China, including Fujian Province where we are based and our pre-packaged rice is sold.

2

China’s Rice Bran Oil Industry

Despite China being one of the largest rice consuming nations, if not the largest, we believe production of and demand for refined rice bran oil has lagged behind in China due the complexity of and the capital requirements for its production.  However, we have seen large Chinese grain and edible oil companies entering this market since 2009, which we believe is driven by growing health awareness and disposable income levels in China’s recent history.  Base on internal research, we estimate that Chinese domestic refined rice bran oil production rose from 4,000 mt in 2006 to 33,000 mt in 2010, while demand grew from 190,000 mt to 238,000 mt over the same period.  By 2012, we project domestic production of and demand for rice bran oil to reach 63,000 mt and 276,000 mt, respectively.  With our production of refined rice bran oil to formally commence immediately after we obtain a Production License anticipated by the end of May 2011, we believe that we are well-positioned to be one of the leading rice bran oil market players.

Our Competitive Strengths

We believe the following strengths differentiate us from our competitors in China:

· We are dedicated to producing the highest quality of rice through our strict quality control measures while at the same time maximizing profit margins from our production process by deriving value from our byproducts such as rice hull, rice bran and broken rice;

· We source our short/medium-shaped rice grain predominantly from three regions in northeastern China  which are renowned for the quality of their short/medium-shaped rice crops;

· We have a well-established and extensive sales network throughout Fujian Province;

· We understand the importance of branding and brand recognition, and price our products competitively against other brands to associate our brand with both quality and value; and

· We have strong research and development capabilities.

Our Growth Strategies

· We aim to consolidate our market share in Fujian and then expand into adjacent provinces by increasing brand marketing and awareness, and expanding our sales channels;

· We aim to increase our production capacity, with the goal of achieving annual processing capacity of 0.8 to 1.0 million mt in the next five years;

· We aim to secure long-term strategic supply contracts in order to better secure our grain supplies; and

· We aim to maximize value from our rice processing byproducts, from producing refined rice bran oil from rice bran to generating power from rice hull for our energy needs.

Our Corporate History and Structure

Mr. Jianshan Yao and Mr. Jianxin Yao are the shareholders of Sunlight Blaze, which is a company limited by shares established under the laws of the British Virgin Islands on April 9, 2010.  Mr. Jianshan Yao holds 99.75% of Sunlight Blaze’s equity interests, and Mr. Jianxin Yao holds the rest of 0.25%.  Sunlight Blaze holds 85% equities of Grand Farm Cayman, which is a limited liability company established under the laws of the Cayman Islands on June 30, 2010, and Grand Farm Cayman holds 100% equities of Grand Farm HK, a Hong Kong company.None of the other shareholders of Grand Farm Cayman holds more than 5% of the issued and outstanding shares of Grand Farm Cayman. Grand Farm WFOE is a limited liability company established under the laws of PRC on September 19, 2010 and is a wholly-owned subsidiary of Grand Farm HK.

3

We operate our business in the PRC through certain contractual arrangements between Grand Farm WFOE and Grand Farm China, a company established under the laws of the PRC in Putian, Fujian Province on May 31, 2001.  For a description of the contractual arrangements, please see “Our Corporate History and Structure – Contractual Arrangements with Grand Farm China and its Equity Owners” elsewhere this prospectus.  All of the issued and outstanding shares of Grand Farm China are currently held by two Chinese citizens, namely our chairman, Jianshan Yao, who owns a 99.75% equity interest in Grand Farm China, and his brother Jianxin Yao, who holds the remaining 0.25%.

The chart below illustrates our corporate structure as of the date of this prospectus.

(1) Includes 3% held by Chaotang Li, our strategic development director and a member of our board of directors, through an entity that he owns and controls.

Please see the section entitled “Risk Factors — Risks Relating to Our Structure.”

The chart below illustrates our corporate structure immediately after the closing of this offering, assuming all ADSs offered in the offering are sold.

4

(1) Includes      % held by Chaotang Li, our strategic development director and a member of our board of directors, through an entity that he owns and controls.

(2) Each ADS represents       of our ordinary shares, par value $0.002 per share.

Corporate Information

Our registered office is located at the offices of Offshore Incorporations (Cayman) Limited, Scotia Centre, Fourth Floor, P. O. Box 2804, George Town, Grand Cayman KY1-1112, Cayman Islands, British West Indies.  Our principal executive offices are located at No.2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, PRC, and the telephone number at this address is +86-594-3599889.  Our website is www.grandfarminc.com.  Information contained on our website does not constitute part of, and is not deemed incorporated by reference into, this prospectus.  Our agent for service of process in the United States is Puglisi & Associates, whose address is 850 Library Avenue, Suite 204, Newark, Delaware 19711, and whose telephone number is (302) 738-7210.

Our Challenges

We believe that our primary challenges are:

· Competition from other major rice producers in China;

· Our continuing ability to meet our rice grain needs as larger and better-resourced competitors gain greater control to grain supplies;

· Our access to and costs of grain supplies are impacted by natural disasters; and

5

· There is uncertainty regarding refined rice bran oil market as we move forward on production of this product expected in the near future.

Please see “Risk Factors” and other information included in this prospectus for a discussion of these and other risks.

6

The Offering

The following assumes that the underwriters do not exercise their option to purchase up to       additional ADSs in the offering, unless otherwise indicated.

Price per ADS:	We currently estimate that the initial public offering price will be between $      and $      per ADS.
ADSs offered by us:	ADSs
ADSs outstanding immediately after this Offering:	ADSs (or       ADSs if the underwriters exercise in full the over-allotment option)
Ordinary shares outstanding immediately after this Offering:	ordinary shares (or       ordinary shares if the underwriters exercise in full the over-allotment option)
The ADSs:	Each ADS represents       ordinary shares.  The depositary will hold the ordinary shares underlying your ADSs and you will have rights as provided in the deposit agreement. We do not expect to pay dividends in the foreseeable future.  If, however, we declare dividends on our ordinary shares, the depositary will pay you the cash dividends and other distributions it receives on our ordinary shares, after deducting its fees and expenses. You may turn in your ADSs to the depositary in exchange for ordinary shares.  The depositary will charge you fees for any exchange. We may amend or terminate the deposit agreement without your consent.  If you continue to hold your ADSs, you agree to be bound by the deposit agreement as amended. To better understand the terms of the ADSs, you should carefully read the “Description of American Depositary Shares” section of this prospectus.  You should also read the deposit agreement, which is filed as an exhibit to the registration statement that includes this prospectus.
Proposed NASDAQ Capital Market symbol:	GRFM
Option to purchase additional ADSs:	We have granted to the underwriters an option, exercisable within 45 days from the date of this prospectus, to purchase up to an additional       ADS solely to cover over-allotments.
Underwriter’s Warrants:	For services rendered, we have agreed to issue to the underwriter (or its designated affiliates) warrants to purchase up to       ADSs equal to 7% of the aggregate number of ADSs sold in this offering, including the over-allotment option, exercisable six months after the closing of the offering and expiring five years from the effective date of the registration statement of which this prospectus forms a part.  If these warrants are exercised, each ADS may be purchased at $      (150% of the initial offering price per ADS sold in the offering), and the warrants may be exercised on a cashless basis.

7

Timing and settlement for ADSs:	The ADSs are expected to be delivered against payment on      , 2011.
Use of proceeds:	Our net proceeds from this offering are expected to be approximately $      million assuming a public offering price of $      (the midpoint of the estimated initial public offering price range, after deducting the underwriting discounts and commissions and estimated aggregate offering expenses payable by us).  We plan to use net proceeds we receive from this offering to increase our sales and marketing efforts, to expand production capacity and for other general corporate purposes.  See “Use of Proceeds” on page 33.
Risk Factors:	Investing in these securities involves a high degree of risk.  As an investor you should be able to bear a complete loss of your investment.  You should carefully consider the information set forth in the “Risk Factors” section beginning on page 10.
Lock-Ups:	Our directors and officers have agreed with the underwriters not to offer, sell or otherwise dispose of any of our securities for a period of 12 months from the closing of this offering.  See “Underwriting” on page 110.
Depositary:	Deutsche Bank Trust Company Americas

8

Selected Financial and Operating Data

The following selected financial and operating data as of and for the years ended December 31, 2008, 2009 and 2010, have been derived from our audited consolidated financial statements for the years ended December 31, 2008, 2009 and 2010 that are included elsewhere in this prospectus, and should be read in conjunction with such financial statements and the accompanying notes and “Operating and Financial Review and Prospects” beginning on page 40 of this prospectus.  The selected financial and operating data as of and for the year ended December 2007 have been derived from our audited combined financial statements for such year, which are not included in this prospectus.  Our results of operations in any period may not necessarily be indicative of the results that may be expected for any future period. See “Risk Factors” beginning on page 10 of this prospectus.  In accordance with Item 3.A.1 of Form 20-F, we are omitting our selected combined financial data for fiscal year 2006 because we do not currently have audited financial statements for such year and such information cannot be provided in accordance with US GAAP without unreasonable effort or expense.

	For the fiscal year ended  December 31,
	2007			2008			2009			2010
	(In thousands, except for per share data)
Revenues	$	15,166		$	36,007		$	60,533		$	82,189
Income from operations		2,592			5,886			12,891			14,843
Other expense		(582	)		(942	)		(847	)		(769	)
Net income		1,333			4,941			12,071			14,095
Net income per share
- Basic		0.05			0.20			0.48		$	0.56
- Diluted		0.05			0.20			0.48			0.56

	December 31,
	2007		2008		2009			2010
	(In thousands)
Total assets	$	19,921	$	30,068		$	44,175	$	54,085
Total liabilities		11,092		15,594			17,623		22,153
Total shareholders’ equity		8,829		14,474			26,552		31,932
Total liabilities and shareholders’ equity	$	19,921	$	30,068		$	44,175	$	54,085

9

RISK FACTORS

You should carefully consider all of the information in this prospectus, including various changing regulatory, competitive, economic, political and social risks and conditions described below, before making an investment in our ADSs. One or more of a combination of these risks could materially impact our business, results of operations and financial condition. In any such case, the market price of our ADSs could decline, and you may lose all or part of your investment.  This prospectus also contains forward-looking statements that involve risks and uncertainties.  Our actual results could differ materially from those anticipated in the forward-looking statements as a result of the risks below.

Risks Relating to Our Business

We are at an early stage of development and have a limited operating history, which makes it difficult to evaluate and predict our future operating results especially in the highly fragmented rice processing industry in China.

We have a limited operating history, as Grand Farm China commenced business May 2001 in Fujian, China.  Accordingly, you should consider our future prospects in light of the risks experienced by companies such as ours operating in the highly fragmented rice processing industry in China.  Some of these risks and uncertainties relate to our ability to:

· maintain our market position and compete with other rice producers, many of which have longer operating histories and greater financial resources than we do;

· comply with changes to regulatory requirements;

· raise our brand recognition and customer loyalty;

· maintain adequate control of our costs and expenses;

· raise sufficient capital to sustain and expand our business;

· and attract, retain, integrate and motivate qualified personnel.

If we are unsuccessful in addressing any of the risks and uncertainties listed above, our business, financial condition and results of operations may be materially and adversely affected.

Our operating results fluctuate from period to period, and likely will continue to fluctuate significantly, making them difficult to predict and could cause our operating results for a particular period to fall below expectations, thus resulting in a decrease in the price of our ADSs.

Our operating results from period to period are highly dependent upon, and will fluctuate, based on the following factors:

· raw material supply and costs be impacted by natural disasters;

· reliability of newly established production facilities;

· market competitions that influence the selling prices of our products;

· sales channel expansion to existing and newly developed market places; and

· the success of our advertising and promotional efforts.

Due to these and other factors listed in this “Risk Factors” section, our operating results will vary from period to period, will be difficult to predict for any given period, may be adversely affected from period to period and may not be indicative of our future performance.  In addition, our operating results may vary significantly from period to period as a result of factors beyond our control, such as the recent slowdown in China’s economic growth caused in part by the recent severe global crisis in the financial services and credit markets, and may be difficult to predict for any given period.  Our past results may not be indicative of our future performance and our quarterly results may not be indicative of our full year results.  If our operating results for any period fall below our expectations or the expectations of investors or any market analyst that may issue reports or analyses regarding our ADSs, the price of our ADSs is likely to decrease.

10

As we sell our prepackaged rice products primarily to third-party distributors and do not sell directly to end consumers, , this could affect our ability to efficiently and profitably distribute and market such products, maintain our existing markets and expand our business into other geographic markets.

We do not sell our prepackaged rice products directly to end customers. Instead, we primarily rely on third-party distributors for the sale and distribution of these products throughout Fujian Province, who collectively accounted for 96.28%, 82.39% and 74.09% of our revenues in 2008, 2009 and 2010, respectively.  As of December 31, 2010, we had a network of 50 distributors for our prepackaged rice products.  We do not enter into long-term agreements with distributors and have no control over their everyday business activities. To the extent that our distributors are distracted from selling our products or do not expend sufficient efforts in managing and selling our products, our sales will be adversely affected.  Our ability to maintain our distribution network and attract additional distributors will depend on a number of factors, many of which are outside of our control.  Some of these factors include: (i) the level of demand for our brand and products in a particular distribution area; (ii) our ability to price our products at levels competitive with those offered by competing products and (iii) our ability to deliver products in the quantity and at the time ordered by distributors.

There can be no assurance that we will be able to meet all or any of these factors in any of our current or prospective geographic areas of distribution.  Furthermore, shortage of adequate working capital may make it impossible for us to do so.  Our inability to achieve any of these factors in a geographic distribution area will have a material adverse effect on our relationships with our distributors in that particular geographic area, thus limiting our ability to maintain and expand our market, which will likely adversely affect our revenues and financial results.

We do not have business insurance coverage.

The insurance industry in China is still at an early stage of development.  Insurance companies in China offer limited business insurance products, or offer them at a high price.  As a result, we do not have any business liability, loss of data or disruption insurance coverage for our operations in China.  Any business disruption, litigation or natural disaster might result in our incurring substantial costs and the diversion of our resources.

We are dependent upon our existing management and our key personnel, and our business may be severely disrupted if we lose their services.

Our future success depends substantially on the continuing services of our executive officers and our key personnel.  If one or more of our executive officers and key personnel were unable or unwilling to continue in their present positions, we might not be able to replace them easily or at all.  In addition, if any of our executive officers or key employees joins a competitor or forms a competing company, we may lose know-how, key professionals and staff members as well as suppliers, and our competitive position and business prospects may be materially and adversely affected.

If we fail to accurately project demand for our products, we may encounter problems of excess production capacity, which would materially and adversely affect our business, financial condition and results of operations, as well as damage our reputation and brand.

We plan to use part of the proceeds from this offering, in addition to our cash generated from our operations and bank loans, to fund our production capacity expansion.  However, if there is no or little growth in demand for rice as we have expected, we may encounter difficulties in selling our increased production capacity, which would materially and adversely affect our business, financial condition and results of operations.

Many of our customers, including our distributors, contract with us for specified minimum purchase amounts for terms of one year or less, and typically place their purchase orders one week in advance of a required delivery.  We take such contracts and orders into account when we formulate our overall operation plans.  We project demand for our products based on rolling projections from our customers and customer inventory levels.  The varying sales and purchasing cycles of our customers, however, make it difficult for us to accurately forecast future demand for our products.  Our inability to accurately predict and to timely meet demand, or the failure of our customers to take up their contracted volume of our products, could materially and adversely affect our business, financial condition and results of operations.

11

Our inability to expand or to manage the expansion of our production capacity and growth could materially adversely affect our business, financial condition and results of operations, and result in a loss of business opportunities.

We plan to use a substantial portion of our net proceeds from this offering to fund our production capacity expansion.  However, we may be unsuccessful in the timely or cost-efficient expansion of our production capacity. This project and others may not be constructed on the anticipated timetable or within budget.  Any material delay in completing these projects, or any substantial increase in costs or quality issues in connection with these projects, could materially and adversely affect our business, financial condition and results of operations, and result in a loss of business opportunities.

Furthermore, we have limited operational, administrative and financial resources, which may be inadequate to sustain the growth we want to achieve.  We have experienced a period of rapid growth and expansion that has placed, and will continue to place, strain on our management personnel, systems and resources.  To accommodate our growth pursuant to our strategies, we anticipate that we will need to implement a variety of new and upgraded operational and financial systems procedures and controls, and improve our accounting and other internal management systems, all of which require substantial management efforts and financial resources.  We will also need to continue to expand, train, manage and motivate our workforce, and effectively manage our relationships with our customers and suppliers.  All of these endeavors will require substantial management effort and skills and the incurrence of additional expenditures.  We cannot assure you that we will be able to efficiently or effectively implement our growth strategies and manage the growth of our operations, and any failure to do so may limit our future growth and hamper our business strategy.

Rising prices of our raw materials could yield lower margins for our products if we are unable to pass such rising prices on to our customers, which could reduce our profitability and have a material adverse effect on our business.

Our key raw material is rice grains.  Changes in the prices for rice grain would significantly affect our cost of goods sold.  In general, rising price of rice grain will produce lower profit margins for us if we are unable to pass such rising costs on to our customers.  Whether we can pass such rising costs on to our customers depends on a variety of factors, including rice grain pricing and consumer market conditions.  The price of rice is influenced by weather conditions and other factors affecting crop yields, farmer planting decisions and general economic, market and regulatory factors such as government policies and subsidies with respect to agriculture and international trade, and global and local demand and supply.  The significance and relative effect of these factors on the price of rice is difficult to predict.  Also, although our supply contracts provide us access to rice grains in the off-seasons and other times when grain supplies are less abundant (due to crop failure and other factors), we have no contracts or derivative instruments in place that effectively hedge against the fluctuations in the price of this raw material as our rice grain purchase and rice sales contracts are priced based on market conditions.  Any event that tends to negatively affect the supply of this raw material could increase prices and potentially harm our business.  To the extent that we cannot fully pass on the price increases in raw material to our customers, or at all, our business and profitability would be materially and adversely affected.

12

Governmental authorities within the PRC periodically set rice prices and enact general industry policies which limit production capacity and use of raw materials.  Although governmental pricing guidance has not had a material impact on our business in the past, a significant increase in the market price of rice grain as a result of such governmental efforts would increase our cost of sales, and we may not be able to fully pass those increased costs on to our customers.  Such increased costs and other policy initiatives could limit our growth and have a material adverse effect on our business, financial condition and results of operations.

The PRC government has the power to intervene in the price of important types of grain (including rice grain) under certain circumstances, such as when a material change occurs to the market supply and demand and/or the grain price fluctuates significantly, in order to protect the interests of farmers.  In practice, the PRC government will periodically purchase a large amount of rice from farmers and set the price for the rice purchased by the government, resulting in effective guidance of the market price by the PRC government.  This has a significant impact on the market price of rice for the following year, but does not constitute a legally mandated price for rice.  Although such pricing guidance has not had a material impact on our business in the past, a significant increase in the market price of rice as a result of such governmental efforts would increase our cost of sales, and we may not be able to pass those increased costs on to our customers.  Such increased costs could have a material adverse effect on our business, financial condition and results of operations.

If we are unable to access rice of the quality required to meet our production standards, or if we are unable to obtain a sufficient supply of raw materials from our suppliers or at all, our business, financial condition and results of operations and financial performance may suffer.

From time to time we may be unable to access rice grain of the quality and type that meets our production standards, which could adversely affect our financial performance. Furthermore, our extended inability to obtain and process rice of the required quality would also reduce our annual production.

If we experience a shortage in the supply of rice grain in the future, irrespective of quality, our production capacities and results of operations would be materially and adversely affected.  We source approximately 93% of our short/medium-shaped rice grain from northeastern China.  We mainly source long-shaped rice grain from rice grain distributors in Fujian and Jiangxi.  If we lose any of these significant sources of rice grains through crop failure or through the failure by our suppliers to abide by the material terms of our sourcing arrangements, we would be required to purchase rice grains at less favorable prices which could adversely affect our profit margins.  We may also have difficulty finding alternative sources of rice grains on satisfactory terms in a timely manner, or at all, which could cause us not to operate at full capacity. Identifying and accessing alternative sources may increase our costs and extended lack of raw materials will reduce production capacity which would have a materially adverse effect on our financial performance.

Our dependence on a limited number of suppliers for rice grains could prevent us from timely delivering our products to our customers in the required quantities, which could result in order cancellations and decreased revenues.

We currently work with approximately 44 rice grain suppliers, including state-owned grain reserves.  In 2008, our three biggest suppliers accounted for 30%, 28%, and 13% of our total purchase, respectively.  In 2009, our three biggest suppliers accounted for 21%, 10% and 10% of our total purchase, respectively.  In 2010, our three biggest suppliers accounted for 18%, 8% and 6% of our total purchases, respectively.  If we fail to maintain our relationships with these or our other suppliers, we may be unable to produce enough rice or our rice may be available at a higher cost or after a long delay, and we could be prevented from delivering rice to our customers in the required quantities and at prices that are profitable.  Problems of this kind may cause us to experience order cancellations and loss of market share.  The failure of a supplier to supply rice grains that meet our quality, quantity, and cost requirements in a timely manner could impair our ability to produce rice or increase our costs, particularly if we are unable to obtain rice grains from alternative sources on a timely basis or on commercially reasonable terms.

If we experience problems with our product quality, customer satisfaction with respect to pricing of our products or the timely delivery of our products, we could lose our customers and market acceptance which will affect our sales and have an adverse effect on our business, financial condition and results of operations.

Our growth and sales primarily depend on our ability to maintain quality control and customer satisfaction with respect to pricing and the punctual availability and delivery of our products.  If we fail to deliver the same quality of our products with the same punctuality and pricing which our customers have grown accustomed to, or in accordance with the terms of our sales agreements, we could damage our customer relations and market acceptance which will affect sales and our business in general.  If we experience deterioration in the performance or quality of any of our products, whether due to problems internally or externally, it could result in delays in delivery, cancellations of orders or customer complaints, loss of goodwill, diversion of the attention of our senior personnel and harm to our brand and reputation.  Any and all of these results would have an adverse effect on our business, financial condition and results of operations.

13

Any interruption in our production and distribution processes could impair our financial performance and negatively affect our brand.

Our production operations involve the coordination of raw materials, internal production processes and external distribution processes.  We may experience difficulties in coordinating the various aspects of our production processes, thereby causing downtime and delays.  We produce and store almost all of our products at our production facilities.  We do not maintain back-up facilities, so we depend on these facilities for the continued operation of our business.

A delay or stoppage of production caused by adverse weather, natural disaster or other unanticipated catastrophic event, including, without limitation, power interruptions, water shortage, storms, fires, earthquakes, terrorist attacks and wars, could significantly impair our ability to produce our products and operate our business, as well as delay our research and development activities.  Our facilities and certain equipment located in these facilities would be difficult to replace and could require substantial replacement lead-time.  Catastrophic events may also destroy any inventory located in our facilities.  The occurrence of such an event could materially and adversely affect our business.  Any stoppage in production, even if temporary, or delay in delivery to our customers could severely affect our business or reputation.  We currently do not have business interruption insurance to offset these potential losses and any interruption in our production operations or production and distribution processes could impair our financial performance and negatively affect our brand.

Failure to properly manage our storage system may damage our products, resulting in operating losses.

Rice storage entails significant risks associated with the storage environment, including moisture, temperature and humidity levels, deviations in which may result in damage to rice in stock.  Any significant damage to the products we have in storage could materially and adversely affect our results of operations.

Transportation delays, including as a result of disruptions to infrastructure, could adversely affect our business, results of operations and financial condition.

We rely on both ground and water transportations for the delivery of raw materials and for the delivery of our products to our customers.  Any disruptions in this infrastructure network, whether caused by earthquakes, storms, other natural disasters or human error or malfeasance, could materially impact our business.  Therefore, any unexpected delay in transportation of our raw materials or in the delivery of our products to our customers could result in significant disruption to our operations, including the closure of our facilities.  If for any reason we should lose the use of these facilities, we may not be able to find sufficient alternative methods of transport for products from our existing facilities.  We also rely upon others to maintain roads from our production facilities to road and shipping networks, and any failure on their part to maintain such transportation systems could impede the delivery of our raw materials to us and our products to our customers, impose additional costs on us or otherwise cause our business, results of operations and financial condition to suffer.

Environmental compliance and remediation could result in substantially increased capital requirements and operating costs which could adversely affect our business.

We are subject to the PRC laws and regulations relating to the protection of the environment.  These laws continue to evolve and are becoming increasingly stringent.  The ultimate impact of complying with such laws and regulations is not always clearly known or determinable because regulations under some of these laws have not yet been promulgated or are undergoing revision.  The facility where we are headquartered is in compliance with environmental acceptance inspection procedures, and has obtained a formal waste discharge permit.  We have also completed the environmental inspection acceptance procedures for our second facility, and we are in the process of obtaining its formal waste discharge permit, although we have not obtained such permit as of the date of this prospectus.  In the event that we fail to comply with any of the aforesaid procedures in the future, we may be subject to a fine or be required to make corrections within a prescribed period.  Our business and operating results could be materially and adversely affected if we were required to increase expenditures to comply with any new environmental regulations affecting our operations.  Although we have designed and implemented procedures and measures to promote occupational health and safety, we cannot completely eliminate the risks of contamination, injury to employees or others, or other harms related to our operations.  In the event of future incidents, we could be liable for any damages that may result, including potentially significant monetary damages for any civil litigation or government proceedings related to a personal injury claim, as well as other fines, penalties and other consequences, including suspension or revocation of our licenses or permits or suspending production or ceasing operations at our research and manufacturing facilities, all of which could have a material adverse effect on our business, reputation, financial condition and results of operations.

14

The expansion of our sales and marketing and distribution efforts in new provinces and regions may not be as successful as in Fujian, or at all.

We plan to expand our sales and marketing and distribution efforts into provinces and regions beyond Fujian.  However, our experience in the sales and marketing and distribution of our products in Fujian may not be applicable in other parts of China.  We cannot assure you that we will be able to leverage such experience to expand into other provinces and regions.  When we enter new markets, we may face intense competition from other rice producers with established experience or presence in the geographical areas in which we plan to enter and from other rice producers with similar target customers.  In addition, expansion of sales into new markets in new provinces will require the hiring and training of a new sales force to market and sell our products in that region, the assimilation with the local business cultures of new regions which may be very different from the business culture of Fujian, and require a diversion of resources and time of our senior management personnel.  If we fail to integrate effectively in new markets, our operating efficiency may be affected. Furthermore, because customers in new provinces may be far away from our production facilities, our profit margins may be lower because of increased costs in the transportation of our products.  Demand for rice and government regulation may also be different in other provinces.  Our failure to manage our planned expansion of sales into new provinces may have a material adverse effect on our business, financial condition and results of operations and we may not have the same degree of success in other provinces that we have had so far to date, or at all.

Our production activities are and will continue to be conducted in concentrated locations.  Damage to or disruptions at our production facilities could materially and adversely affect our business, financial condition and results of operations, especially since we do not have any business interruption insurance.

Our two operating production facilities are located in Fujian Province, making our operations particularly vulnerable to natural and other disasters that may occur in that province.  Operating hazards, natural disasters or other unanticipated or catastrophic events, including power interruptions, water shortages, storms, typhoons, fires, explosions, earthquakes, terrorist attacks, wars, and labor disputes in and around these provinces could cause damage to or destroy our facilities or equipment therein.  Any of these or similar events could significantly impair our ability to operate our business, as well as delay our research and development activities and commercial production.  Our facilities and equipment are expensive and potentially difficult and time-consuming to repair or replace.  Catastrophic events may also result in damage to or the destruction of inventory located in our production facilities.  In addition, we do not carry any business interruption or other insurance that would compensate us in the event of a loss of this type.  The occurrence of such an event could result in substantial costs and diversion of resources, and our business, financial condition and results of operations may be materially and adversely affected.

Our business is capital intensive and our growth strategy may require additional capital which may not be available on favorable terms or at all.

We may require additional cash resources due to changed business conditions, implementation of our strategy to expand our manufacturing capacity or potential investments or acquisitions we may pursue.  Furthermore, if we fail to complete this offering, or complete it at a level below our expectations, we will not have the capital necessary to support our future expansion activities, which could force us to sell debt securities or additional equity securities, or obtain additional credit facilities from banks in the PRC in order to implement our growth strategy or to otherwise meet our capital needs.  The sale of additional equity securities could result in dilution of your holdings.  The incurrence of indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that would restrict our operations.  Financing may not be available in amounts or on terms acceptable to us, if at all.  Any failure by us to raise additional funds on terms favorable to us, or at all, could limit our ability to expand our business operations and could harm our overall business prospects.

15

If our land use rights are revoked, we would have no operational capabilities.

Under Chinese law land is owned by the state or rural collective economic organizations.  The state may issue to a land user a land use right certificate giving such land user certain rights akin to land ownership of the land for a fixed period of time of generally 50 years or more.  Such land use rights, however, can be revoked and the land user forced to vacate at any time when redevelopment of the land is in the public interest.  The public interest rationale is interpreted quite broadly and the process of land appropriation may be less than transparent.  The land on which our headquarters and production facility occupies relies on such land use rights, and the loss of such rights would have a material adverse effect on our company and our operations.

The production activities from our second production facility will be disrupted if we are unable to renew the lease for the plant site, and the remedies offered by the lease agreement is limited in case of early lease termination by the lessor, all of which could adversely affect our business prospects, especially with respect to our anticipated refined rice bran oil business.  In addition, our ability to install a rice production line at this facility, and to commence production therefrom, is dependent on the successful completion of an environmental impact study being conducted by the Putian Environmental Protection Bureau.

We are leasing the 11,611 m2 site of our second production facility, which houses our refined rice bran oil production line, pursuant to a lease agreement entered into between Grand Farm China and Fujian Jia Jia Food Co., Ltd., or Fujian Jia Jia, originally from July 1, 2009 to December 31, 2020, now extended to December 31, 2028.  Although Grand Farm China has priority under the lease agreement to continue the lease upon expiration, such priority is subject to Fujian Jia Jia’s willingness to continue the lease and is thus not guaranteed.  If Fujian Jia Jia refuses to continue the lease or will only continue the lease upon terms that are not reasonable or acceptable to us, all of our activities at this production facility, including refined rice bran oil production which we are planning to launch immediately after we obtain a Production License anticipated by the end of May 2011, will be disrupted.  In addition, if Fujian Jia Jia terminates the lease agreement, as now extended, before its term expire, our remedy is limited to up to RMB 20,000,000 from Fujian Jia Jia as compensation.  Such amount may not be sufficient to cover all of the losses incurred by us for the disruption to ongoing production activities and the costs to relocate our production facility.

This facility will also house another rice production line with projected annual rice grain processing capacity of 90,000 mt, yielding approximately 60,000 mt of milled rice.  Because the building that this production line will occupy requires modifications to accommodate our equipment, we are in the process of registering the plan for the modifications with the Putian Development and Reform Commission, and allowing the Putian Environmental Protection Bureau to complete an environmental impact study in connection with such modifications.  While we currently expect the study to be completed by May 2011, the timing of the completion is ultimately beyond our control, and there is no guarantee that the study will be completed by then or that the result of the study will be favorable to us.

We cannot commence production of refined rice bran oil until we have the required Production License.

According to the Regulation of the People's Republic of China on the Administration on Production License for Industrial Products, or the Production License Regulation, and its implementation measures, we must have a Production License before we can commence production of refined rice bran oil, which we are in the process of applying for with the Administration of Quality Inspection of Fujian Province.  While we currently anticipate obtaining the Production License by the end of May 2011, the timing of the approval is ultimately beyond our control, and there is no guarantee that we will obtain the Production License by then or that our application will be approved at all.  While we are not relying on the sales of refined rice bran oil as our sole source of revenue, we have already expended resources in connection with, and established a facility for, the production of refined rice bran oil.  Any delay in obtaining the Production License, whether due to the pace of the application review process or otherwise, will delay our anticipated production launch, which may in turn increase our economic burdens associated with this product.  If we cannot ultimately succeed in obtaining the Production License, however, we will be unable to use our production facility for its intended purpose and derive such economic benefits that we are anticipating from the production and sales of refined rice bran oil.

We face risks related to health epidemics and other outbreaks or acts of terrorism in China, which could result in reduced demand for our products or disrupt our operations.

Our business could be materially and adversely affected by an outbreak of H1N1 influenza A, avian flu, severe acute respiratory syndrome or another epidemic, or an act of terrorism.  From time to time, there have been reports on the occurrences of avian flu in various parts of China, including a few confirmed human cases and deaths. Since 2009, human cases of H1N1 influenza A virus infection have been identified internationally.  Any prolonged recurrence of H1N1 influenza A, avian flu, severe acute respiratory syndrome or other adverse public health developments in China or elsewhere in Asia may have a material and adverse effect on our business operations.  In addition, terrorist attacks, such as those that took place on September 11, 2001, geopolitical uncertainty and international conflicts, could adversely affect our business operations.  Any of these events could adversely affect China’s economy and cause an immediate and prolonged drop in consumer demand. An immediate and prolonged drop in consumer demand could severely disrupt our business operations and adversely affect our results of operations.  Furthermore, a significant portion of our revenues are derived from government customers, which may reduce their spending on our products during a crisis, which could adversely affect our results of operations and could probably be difficult to recover once the threat has subsided.

16

The Chinese agricultural market is highly competitive and our growth and results of operations may be adversely affected if we are unable to compete effectively.

The agricultural market in China is highly fragmented, largely regional and highly competitive, and we expect competition to increase and intensify within the sector. We face significant competition in our rice business. Many of our competitors have greater financial, research and development and other resources than we have. Competition may also develop from consolidation within the rice industry in China.  Our competitors may be better positioned to take advantage of industry consolidation and acquisition opportunities than we are.  As competition intensifies, our margins may be compressed by more competitive pricing and we may lose our market share and experience a reduction in our revenues and profit.

Risks Relating to Our Structure

Grand Farm WFOE’s contractual arrangements with Grand Farm China and its shareholders may not be as effective in providing control over Grand Farm China as direct ownership of Grand Farm China, and the shareholders of Grand Farm China may have potential conflicts of interest with us.

Grand Farm Cayman has no ownership interest in Grand Farm China and conducts substantially all of its operations and generates substantially all its revenues through contractual arrangements that its indirect subsidiary, Grand Farm WFOE, has entered into with Grand Farm China and its shareholders, and such contractual arrangements are designed to provide Grand Farm Cayman with effective control over Grand Farm China.  Grand Farm Cayman depends on Grand Farm China to hold and maintain certain licenses necessary for its farming business.  Grand Farm China also owns all of the necessary intellectual property, facilities and other assets relating to the operation of our business, and employs personnel for our production and product distribution.  See “Our Corporate History and Structure” for a description of the contractual arrangements with Grand Farm China.

The contractual arrangements, however, may not be as effective in providing Grand Farm Cayman with control over Grand Farm China as direct ownership.  If Grand Farm Cayman had direct ownership of Grand Farm China, it would be able to exercise its rights as a shareholder to effect changes in the board of directors of Grand Farm China, which in turn could effect changes, subject to any applicable fiduciary obligations, at the management level.  In lieu of actual ownership, Grand Farm Cayman has to rely on contractual rights to effect control and management of Grand Farm China, which exposes Grand Farm Cayman to the risk of potential breach of contract by the shareholders of Grand Farm China.  In addition, as Grand Farm China is jointly owned by its shareholders, it may be difficult for Grand Farm Cayman to change Grand Farm China’s corporate structure if such shareholders refuse to cooperate with it.

The shareholders, officers and/or directors of Grand Farm China may breach, or cause Grand Farm China to breach, the contracts for a number of reasons.  For example, the interests of the shareholders of Grand Farm China and the interests of Grand Farm Cayman may conflict and we may fail to resolve such conflicts; the shareholders may believe that breaching the contracts will lead to greater economic benefit for them; or the shareholders may otherwise act in bad faith.  If any of the foregoing were to happen, we may have to rely on legal or arbitral proceedings to enforce our contractual rights, including specific performance or injunctive relief, and claiming damages.  Such arbitral and legal proceedings may cost us substantial financial and other resources, and result in disruption of our business, and we cannot assure you that the outcome will be in our favor.

In addition, as all of these contractual arrangements are governed by PRC law and provide for the resolution of disputes through either arbitration or litigation in the PRC, they would be interpreted in accordance with PRC law and any disputes would be resolved in accordance with PRC legal procedures.  The legal environment in the PRC is not as developed as in other jurisdictions, such as the United States.  As a result, uncertainties in the PRC legal system could further limit our ability to enforce these contractual arrangements.  Furthermore, these contracts may not be enforceable in China if PRC government authorities or courts take a view that such contracts contravene PRC laws and regulations or are otherwise not enforceable for public policy reasons.  In the event we are unable to enforce these contractual arrangements, we may not be able to exert effective control over Grand Farm China, and our ability to conduct our business may be materially and adversely affected.

17

Grand Farm WFOE and Grand Farm China’s contractual arrangements may result in adverse PRC tax consequences to us.

Under the Tax Collection and Management Law and its implementation rules issued in 2001 and 2002, respectively, arrangements and transactions among related parties may be subject to audit or challenge by the PRC tax authorities.  “Related parties” are defined as organizations or entities that (1) have a direct or indirect control relationship in terms of capital, operation or sales/purchase; (2) are directly or indirectly owned by a common third party; or (3) possess any other connected relationship based on equity.  We could face material and adverse tax consequences if the PRC tax authorities determine that contractual arrangements between Grand Farm WFOE and Grand Farm China were not made on an arm’s length basis and adjust our income and expenses for PRC tax purposes in the form of a transfer pricing adjustment.  A transfer pricing adjustment could result in a reduction, for PRC tax purposes, of adjustments recorded by Grand Farm China, which could adversely affect us by (i) increasing Grand Farm China’s PRC tax liability without reducing Grand Farm WFOE’s PRC tax liability, which could further result in claims being made against us for underpaid PRC taxes; or (ii) limiting the ability of Grand Farm WFOE and Grand Farm China to maintain preferential PRC tax treatments and other financial incentives.

All of Grand Farm Cayman’s revenues have been, and will continue to be, generated through Grand Farm China, our variable interest entity, or VIE, and Grand Farm Cayman relies on payments made by Grand Farm China to Grand Farm WFOE, our subsidiary, pursuant to contractual arrangements to transfer any such revenues to Grand Farm WFOE.  Any restriction on such payments and any increase in the amount of PRC taxes applicable to such payments may materially and adversely affect our business and our ability to pay dividends to our shareholders.

We conduct substantially all of our operations through Grand Farm China, our VIE, which generates all of our revenues.  As Grand Farm China is not directly owned by us, it is not able to make dividend payments to us.  Instead, Grand Farm WFOE, our indirect subsidiary in China, entered into a number of contracts with Grand Farm China, pursuant to which Grand Farm China pays Grand Farm WFOE for certain services that Grand Farm WFOE provides to Grand Farm China.  However, depending on the nature of the services provided, some of these payments are subject to PRC taxes at different rates, including business taxes and VAT, which effectively reduce the payments that Grand Farm WFOE may receive from Grand Farm China.  We cannot assure you that the PRC government will not impose restrictions on such payments or change the tax rates applicable to such payments.  Any such restrictions on such payments or increases in the applicable tax rates may materially and adversely affect our ability to receive payments from Grand Farm China or the amount of such payments, and may in turn materially and adversely affect our business, our net income and our ability to pay dividends to our shareholders.

The shareholders of our variable interest entity may have potential conflicts of interest with us, which may materially and adversely affect our business and financial condition.

Some of our founders and executive officers are direct and indirect owners of Grand Farm China.  Conflicts of interest may arise between the dual roles of those individuals who are both executive officers of our company and shareholders of our variable interest entity.  We do not have existing arrangements to address potential conflicts of interest between those individuals and our company and cannot assure you that when conflicts arise, those individuals will act in the best interests of our company or that conflicts will be resolved in our favor.  If we cannot resolve any conflicts of interest or disputes between us and those individuals, we would have to rely on legal proceedings, which may materially disrupt our business.  There is also substantial uncertainty as to the outcome of any such legal proceedings.

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Grand Farm WFOE may be liable for certain obligations of Grand Farm China’s contracts, agreements or transactions if Grand Farm China fails to perform its obligations.

According to the operating agreement which forms a part of the contractual arrangements between Grand Farm WFOE and Grand Farm China, Grand Farm WFOE has agreed, when necessary, to serve as Grand Farm China’s guarantor in any contracts, agreements or transactions relating to Grand Farm China’s business, provided that Grand Farm China’s receivable account from its operations and all of its assets are pledged to Grand Farm WFOE, which Grand Farm China has agreed to do, and provided further that Grand Farm China shall not conduct any transaction which may materially affect its assets, obligations, rights or operation (excluding business contracts entered into in the ordinary course of Grand Farm China’s regular operations and the liens obtained by relevant counter parties due to such contracts) without Grand Farm WFOE’s prior written consent.  In the event that Grand Farm China fails to perform its obligations under any contract, agreement or transaction to which Grand Farm WFOE has provided its guarantee pursuant to the operating agreement, Grand Farm WFOE will be liable for Grand Farm China’s obligations thereunder.  In accordance with applicable PRC law, this may include performing Grand Farm China’s obligations such as making payments or delivering goods, and/or assuming Grand Farm China’s liability for breach of contract, any of which may reduce the amount of available funds, if any, that Grand Farm WFOE may use to pay cash dividends to us.

Risks Related to Doing Business in China

Contract drafting, interpretation and enforcement in China involve significant uncertainty.

We have entered into numerous contracts governed by PRC law, many of which are material to our business. As compared with contracts in the United States, contracts governed by PRC law tend to contain less detail and are not as comprehensive in defining contracting parties’ rights and obligations.  As a result, contracts in China are more vulnerable to disputes and legal challenges.  In addition, contract interpretation and enforcement in China are not as developed as in the United States, and the result of any contract dispute is subject to significant uncertainties. Therefore, we cannot assure you that we will not be subject to disputes under our material contracts, and if such disputes arise, we cannot assure you that we will prevail.  Due to the materiality of certain contracts to our business, such as our distribution agreements with our main distributors regarding sale of our products, any dispute involving such contracts, even without merit, may materially and adversely affect our reputation and our business operations, and may cause the price of our ADSs to decline.

Under the PRC EIT Law, we may be classified as a “resident enterprise” of the PRC.  Such classification could result in PRC tax consequences to us and/or our non-PRC resident ADS holders or shareholders.

On March 16, 2007, the National People’s Congress approved and promulgated a new tax law, the PRC Enterprise Income Tax Law, or the EIT Law, which took effect on January 1, 2008.  Under the EIT Law, enterprises are classified as resident enterprises and non-resident enterprises.  An enterprise established outside of the PRC with “de facto management bodies” within the PRC is considered a “resident enterprise,” meaning that it can be treated in a manner similar to an enterprise organized under the laws of the PRC for PRC enterprise income tax purposes.  The implementing rules of the EIT Law define a “de facto management body” as a managing body that in practice exercises “substantial and overall management and control over the production and operations, personnel, accounting, and properties” of the enterprise.  In addition, on April 22, 2009, the State Administration of Taxation of the PRC issued the Notice on the Issues Regarding Recognition of Overseas Incorporated Enterprises that are Domestically Controlled as PRC Resident Enterprises Based on the De Facto Management Body Criteria, or Circular 82, which was retroactively effective as of January 1, 2008. This notice provides that an overseas incorporated enterprise which is controlled by a PRC enterprise will be recognized as a “resident enterprise” if it satisfies all of the following conditions: (i) the senior management responsible for daily production/business operations are primarily located in the PRC, and the location(s) where such senior management execute their responsibilities are primarily in the PRC; (ii) strategic financial and personnel decisions are made or approved by organizations or personnel located in the PRC; (iii) major properties, accounting ledgers, company seals and minutes of board meetings and shareholder meetings, etc., are maintained in the PRC; and (iv) 50% or more of the board members with voting rights or senior management habitually reside in the PRC.  Although we appear to meet the four conditions of Circular 82 on their face, Circular 82 only applies to offshore enterprises controlled by PRC enterprises, not those controlled by PRC individuals or foreigners, like our company.  Nevertheless, the determining criteria set forth in Circular 82 may reflect the State Administration of Taxation’s general position on how the “de facto management body” test should be applied in determining the tax resident status of offshore enterprises, regardless of whether they are controlled by PRC enterprises, individuals or foreigners.  If the PRC tax authorities determine that we are a “resident enterprise,” we may be subject to enterprise income tax at a rate of 25% on our worldwide income. This may have an impact on our effective tax rate, and may result in a material adverse effect on our net income and results of operations.  In addition, dividends paid by us to our investors that are not tax residents of the PRC, or non-resident investors, as well as gains realized by such investors from the sale or transfer of our ADSs or ordinary shares may be subject to a PRC tax, and we may be required to withhold PRC tax on dividends paid to our non-resident investors.  However, as the EIT Law and Circular 82 are relatively new, and due to their lack of enforcement history to date, it remains unclear how they will be ultimately interpreted and implemented in practice by the relevant PRC authorities.  As such, we are unable at this time to assess the likelihood that we will be deemed a “resident enterprise.”

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Moreover, the State Administration of Taxation, or SAT, released Circular Guoshuihan No. 698, or Circular 698, on December 10, 2009 that reinforces the taxation of certain equity transfers by non-resident investors through overseas holding vehicles.  Circular 698 is retroactively effective from January 1, 2008.  Circular 698 addresses indirect equity transfers as well as other issues.  The term “equity transfer income” as used in this circular refers to the income obtained from the transfer of equity of a PRC resident enterprise by a non-resident enterprise (excluding the shares of the PRC resident enterprises bought and sold in the public securities market).  According to Circular 698, where a non-resident investor that indirectly holds an equity interestin a PRC resident enterprise through a non-PRC offshore holding company indirectly transfers an equity interest in the PRC resident enterprise by selling an equity interest in the offshore holding company, and the latter is located in a country or jurisdiction where the actual tax burden is less than 12.5% or where the offshore income of its residents is not taxable, the non-resident investor is required to provide the PRC tax authority in charge of that PRC resident enterprise with certain relevant information within 30 days of the execution of the equity transfer agreement.  The tax authorities in charge will evaluate the offshore transaction for tax purposes.  In the event that the tax authorities determine that such transfer is abusing forms of business organization and a reasonable commercial purpose for the offshore holding company other than the avoidance of PRC income tax liability is lacking, the PRC tax authorities will have the power to re-assess the nature of the equity transfer under the doctrine of substance over form.  If the SAT’s challenge of a transfer is successful, it may deny the existence of the offshore holding company that is used for tax planning purposes and subject the non-resident investor to PRC tax on the capital gain from such transfer.  Since Circular 698 has a short history, there is uncertainty as to its application.  We (or a non-resident investor) may become at risk of being taxed under Circular 698 and may be required to expend valuable resources to comply with Circular 698 or to establish that we (or such non-resident investor) should not be taxed under Circular 698, which could have a material adverse effect on our financial condition and results of operations (or such non-resident investor’s investment in us).

If any PRC tax applies to a non-resident investor, the non-resident investor may be entitled to a reduced rate of PRC tax under an applicable income tax treaty and/or a deduction for such PRC tax against such investor’s domestic taxable income or a foreign tax credit in respect of such PRC tax against such investor’s domestic income tax liability (subject to applicable conditions and limitations).  Investors should consult their own tax advisors regarding the applicability of any such taxes, the effects of any applicable income tax treaties, and any available deductions or foreign tax credits.

For a further discussion of these issues, see the section entitled “Taxation — PRC Taxation.”

Adverse changes in political and economic policies of the PRC government could have a material adverse effect on the overall economic growth of China, which could materially adversely affect our business.

Our business, financial condition, results of operations and prospects are affected significantly by economic, political and legal developments in China.  The PRC economy differs from the economies of most developed countries in many respects, including:

· the amount of government involvement;

· the level of development;

· the growth rate;

· the foreign exchange; and

· the allocation of resources.

While the PRC economy has grown significantly since the late 1970s, the growth has been uneven, both geographically and among various sectors of the economy.  The PRC government has implemented various measures to encourage economic growth and guide the allocation of resources.  Some of these measures benefit the overall PRC economy, but may also have a negative effect on us.  For example, our financial condition and results of operations may be adversely affected by government control over capital investments or changes in tax regulations that are applicable to us.

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The PRC economy has been transitioning from a planned economy to a more market-oriented economy. Although the PRC government has in recent years implemented measures emphasizing the utilization of market forces for economic reform, the reduction of state ownership of productive assets and the establishment of sound corporate governance in business enterprises, a substantial portion of the productive assets in China is still owned by the PRC government.  The continued control of these assets and other aspects of the national economy by the PRC government could materially and adversely affect our business.  The PRC government also exercises significant control over economic growth in China through the allocation of resources, controlling payment of foreign currency-denominated obligations, setting monetary policy and providing preferential treatment to particular industries or companies.  Efforts by the PRC government to slow the pace of growth of the PRC economy could reduce demand for our products.

Any adverse change in the economic conditions or government policies in China could have a material adverse effect on the overall economic growth in China, which in turn could lead to a reduction in demand for our products and consequently have a material adverse effect on our business and prospects.

To fund any cash requirements we may have, we may need to rely on dividends, loans or advances made by our PRC subsidiary, Grand Farm WFOE, which are subject to limitations and possible taxation under applicable PRC laws and regulations.

We may rely on dividends and other distributions on equity, or loans and advances made by our Chinese subsidiary, Grand Farm WFOE, to fund any cash requirements we may have, including the funds necessary to pay dividends and other cash distributions, if any, to our shareholders, and to service any debt we may incur.  The distribution of dividends and the making of loans and advances by entities organized in China are subject to limitations.  Regulations in the PRC currently permit payment of dividends only out of accumulated profits as determined in accordance with accounting standards and regulations in China.  Grand Farm WFOE is also required to set aside at least 10% of its after-tax profit based on PRC accounting standards each year to its general reserves until the cumulative amount of such reserves reaches 50% of its registered capital.  These reserves are not distributable as cash dividends, loans or advances.  Grand Farm WFOE may also allocate a portion of its after-tax profits, as determined by its board of directors, to its staff welfare and bonus funds, which may not be distributed to us.  In addition, if Grand Farm WFOE incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other distributions to us.  Also, such dividends may be subject to taxation under the PRC tax laws.  See “Taxation – PRC Taxation – Dividends from Grand Farm WFOE,” below.

Furthermore, under regulations of the State Administration of Foreign Exchange, or the SAFE, the Renminbi is not convertible into foreign currencies for capital account items, such as loans, repatriation of investments and investments outside of China, unless the prior approval of the SAFE is obtained and prior registration with the SAFE is made.

Moreover, we control our operating entity in China, Grand Farm China, through contractual arrangements rather than equity ownership, including an exclusive technical consulting service agreement with Grand Farm China, pursuant to which Grand Farm China will pay Grand Farm WFOE for the services Grand Farm WFOE provides to Grand Farm China.  See “Our Corporate History and Structure.”

We may be required to obtain prior approval of the China Securities Regulatory Commission, or CSRC, of the listing and trading of our ADSs on the NASDAQ Capital Market.

On August 8, 2006, six PRC regulatory authorities, including the Ministry of Commerce, or MOFCOM, the State Assets Supervision and Administration Commission, or SASAC, the State Administration for Taxation, or SAT, the State Administration for Industry and Commerce, or SAIC, the CSRC and the SAFE, jointly issued the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, or the New M&A Rules, which became effective on September 8, 2006.  This regulation, among other things, includes provisions that purport to require that an offshore special purpose vehicle formed for purposes of overseas listing of equity interests in PRC companies and controlled directly or indirectly by PRC companies or individuals obtain the approval of the CSRC prior to the listing and trading of such special purpose vehicle’s securities on an overseas stock exchange.  On September 21, 2006, the CSRC published on its official website procedures regarding its approval of overseas listings by special purpose vehicles.  The application of this new PRC regulation remains unclear.

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Based on our understanding and as advised by B&D Law Firm, our PRC counsel, (i) Grand Farm WFOE was incorporated by a foreign owned enterprise, and there was no acquisition of the equity or assets of a “PRC domestic company” as such term is defined under the New M&A Rules; and (ii) there is no provision in the New M&A Rules that clearly classifies the contractual arrangements between Grand Farm WFOE and Grand Farm China as a kind of transaction falling under the New M&A Rules.  Therefore, we believe that we are not required to obtain the approval of CSRC under the New M&A Rules in connection with this offering.  However, there are substantial uncertainties regarding the interpretation, application and enforcement of the New M&A Rules, and CSRC has yet to promulgate any written provisions or formally declare or state whether the overseas listing of a PRC-related company structured similar to ours is subject to the approval of CSRC. Any violation of these rules could result in fines and other penalties on our operations in China, restrictions or limitations on remitting dividends outside of China, and other forms of sanctions that may cause a material and adverse effect to our business, operations and financial conditions.

The approval of the Ministry of Commerce may be required in connection with the establishment of our contractual arrangements with Grand Farm China. Our failure to obtain this approval, if required, could have a material adverse effect on our business, operating results, reputation and trading price of our ADSs.

The New M&A Rules also provide that approval by the Ministry of Commerce is required prior to a foreign company acquiring a PRC domestic company where the foreign company and the domestic company have the same de facto controlling person(s) that are PRC domestic individual(s) or enterprise(s).  The applicability of the New M&A Rules with respect to the Ministry of Commerce’s approval is unclear.

However, if the Ministry of Commerce subsequently determines that its prior approval was required for our contractual arrangements with Grand Farm China, we may face regulatory actions or other sanctions from the Ministry of Commerce or other PRC regulatory agencies.  These regulatory agencies may impose fines and penalties on us and Grand Farm China, require us to restructure our ownership structure or operations, limit our operations, delay or restrict sending the proceeds from this offering into China, or take other actions.  These regulatory actions could have a material adverse effect on our business, financial condition, results of operations, reputation and prospects, as well as the trading price of our ADSs.

Uncertainties with respect to the PRC legal system could adversely affect us.

Our operations in China are governed by PRC laws and regulations.  We are generally subject to laws and regulations in China.  The PRC legal system is based on written statutes.  Prior court decisions may be cited for reference but have limited precedential value.

However, China has not developed a fully integrated legal system and recently enacted laws and regulations may not sufficiently cover all aspects of economic activities in China.  In particular, because these laws and regulations are relatively new, and because of the limited volume of published decisions and their nonbinding nature, the interpretation and enforcement of these laws and regulations involve uncertainties.  In addition, the PRC legal system is based in part on government policies and internal rules (some of which are not published on a timely basis or at all) that may have a retroactive effect.  As a result, we may not be aware of our violation of these policies and rules until sometime after the violation.  In addition, any litigation in China may be protracted and result in substantial costs and diversion of resources and management attention.

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Fluctuation in the value of the Renminbi may have a material adverse effect on your investment.

The change in value of the Renminbi against the U.S. dollar, Euro and other currencies is affected by, among other things, changes in China’s political and economic conditions.  On July 21, 2005, the PRC government changed its decade-old policy of pegging the value of the Renminbi to the U.S. dollar.  Under the policy, the Renminbi is permitted to fluctuate within a narrow and managed band against a basket of certain foreign currencies.  This change in policy has resulted in an approximately 22.9% appreciation of the Renminbi against the U.S. dollar between July 21, 2005 and December 31, 2009.  Provisions on Administration of Foreign Exchange, as amended in August 2008, further changed China’s exchange regime to a managed floating exchange rate regime based on market supply and demand.  While the international reaction to the Renminbi revaluation has generally been positive, there remains significant international pressure on the PRC government to adopt an even more flexible currency policy, which could result in a further and more significant appreciation of the Renminbi against the U.S. dollar.  As substantially all of our costs and expenses are denominated in Renminbi, the revision in exchange rate policy effected in July 2005 has increased, and potential future revisions could further increase, our costs and expenses in U.S. dollar terms. Our proceeds from overseas financing, such as this offering, will decrease in value if we choose not to or are unable to convert the proceeds of this offering into Renminbi and the Renminbi appreciates against the U.S. dollar, which may reduce the value of your investment.

PRC regulations relating to offshore investment activities by PRC residents may increase our administrative burden and restrict our overseas and cross-border investment activities. If our shareholders fail to make any required applications and filings under such regulations, we may be unable to distribute profits and may become subject to liability under PRC laws.

SAFE issued a public notice in October 2005, or Circular 75, stating that if PRC residents use assets or equity interests in their PRC entities as capital contributions to establish offshore companies or inject assets or equity interests of their PRC entities into offshore companies to raise capital overseas, they are required to register with local SAFE branches with respect to their overseas investments in offshore companies.  They are also required to file amendments to their registrations if their offshore companies experience material events involving capital variation, such as changes in share capital, share transfers, mergers and acquisitions, spin-off transactions, long-term equity or debt investments or uses of assets in China to guarantee offshore obligations.  Under this regulation, their failure to comply with the registration procedures set forth in such regulation may result in restrictions being imposed on the foreign exchange activities of the relevant PRC entity, including the payment of dividends and other distributions to its offshore parent, as well as restrictions on the capital inflow from the offshore entity to the PRC entity.

Our chairman, Mr. Jianshan Yao, and Mr. Jianxin Yao, both of whom are PRC residents and who collectively hold a majority of our current outstanding ordinary shares through Sunlight Blaze, have registered with the SAFE’s local branch with respect to their existing investments in our company.  We have also requested our other PRC resident shareholders to make the necessary applications, filings and amendments as required under Circular 75 and other related rules.  We attempt to comply, and attempt to ensure that our shareholders who are subject to these rules comply with the relevant requirements.  However, we cannot provide any assurances that all of our shareholders who are PRC residents will comply with our request to make or obtain any applicable registrations or comply with other requirements required by Circular 75 or other related rules.  Any future failure by any of our shareholders who is a PRC resident, or controlled by a PRC resident, to comply with relevant requirements under this regulation could subject us to fines or sanctions imposed by the PRC government, including restrictions on Grand Farm WFOE’s ability to pay dividends or make distributions to us and our ability to increase our investment in Grand Farm WFOE.

SAFE rules and regulations may limit our ability to transfer the net proceeds from this offering to Grand Farm China, our VIE in the PRC, which may adversely affect the business expansion of Grand Farm China, and we may not be able to convert the net proceeds from this offering into Renminbi to invest in or acquire any other PRC companies, or establish other VIEs in the PRC.

On August 29, 2008, SAFE promulgated Circular 142, a notice regulating the conversion by a foreign- invested company of foreign currency into Renminbi by restricting how the converted Renminbi may be used.  The notice requires that the registered capital of a foreign-invested company settled in Renminbi converted from foreign currencies may only be used for purposes within the business scope approved by the applicable governmental authority and may not be used for equity investments within the PRC.  In addition, SAFE strengthened its oversight of the flow and use of the registered capital of a foreign-invested company settled in Renminbi converted from foreign currencies.  The use of such Renminbi capital may not be changed without SAFE’s approval, and may not in any case be used to repay Renminbi loans if the proceeds of such loans have not been used.  Violations of Circular 142 will result in severe penalties, such as heavy fines.  As a result, Circular 142 may significantly limit our ability to transfer the net proceeds from this offering to Grand Farm China through our subsidiary in the PRC, which may adversely affect the business expansion of Grand Farm China, including to invest in or acquire any other PRC companies, or to establish other VIEs in the PRC in connection with Grand Farm China’s business, which we currently do not have any intention of doing.

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We may be subject to fines and legal sanctions if we or our employees who are PRC citizens fail to comply with recent PRC regulations relating to employee stock options granted by overseas listed companies to PRC citizens.

On December 25, 2006, the PBOC issued the Administration Measures on Individual Foreign Exchange Control, and its Implementation Rules were issued by SAFE on January 5, 2007, which both have taken effect on February 1, 2007.  Under these regulations, all foreign exchange matters involved in an employee stock holding plan, stock option plan or similar plan in which PRC citizens participate requires approval from the SAFE or its authorized branch.  On March 28, 2007, SAFE promulgated the Application Procedure of Foreign Exchange Administration for Domestic Individuals Participating in Employee Stock Holding Plan or Stock Option Plan of Overseas-Listed Company, or Circular 78.  Under the Stock Option Rule, PRC citizens who are granted stock options or restricted share units, or issued restricted shares by an overseas publicly listed company are required, through a PRC agent or PRC subsidiary of such overseas publicly-listed company, to complete certain other procedures and transactional foreign exchange matters upon the examination by, and approval of, SAFE.  Although we currently do not have any employee stock plan in effect, we may adopt one in the future after the consummation of our initial public offering.  If and when we do, we and our employees who are PRC citizens who may be granted stock options or restricted share units, or issued restricted shares under any such plan will be subject to Circular 78 and intend to complete all procedures and transactional foreign exchange matters to obtain approval of SAFE with respect to such stock options.

If, after our adoption of such plan, the relevant PRC regulatory authority determines that we or our PRC employees who may hold such options, restricted share units or restricted shares shall have failed to comply with these regulations after our listing, we and/or such employees may be subject to fines and legal sanctions.

New labor laws in the PRC may adversely affect our results of operations.

On June 29, 2007, the PRC government promulgated a new labor law, namely, the Labor Contract Law of the PRC, or the New Labor Contract Law, which became effective on January 1, 2008.  The New Labor Contract Law imposes stricter obligations on employers.  Under the New Labor Contract Law, an employer is obligated to execute written labor contracts with all of its employees; otherwise, an employee without a written labor contract will be entitled to claim double the monthly salary from the employer.

The New Labor Contract Law also imposes tougher procedural requirements relating to a reduction in workforce and requires certain terminations to be based upon seniority and not merit.  In the event we decide to significantly change or decrease our workforce, the New Labor Contract Law could adversely affect our ability to enact such changes in a timely and cost-effective manner that is most advantageous to our business and operations, which may materially and adversely affect our financial condition and results of operations.

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Our failure to fully comply with PRC labor laws exposes us to potential liability.

Companies operating in China must comply with a variety of labor laws, including certain social insurance, housing fund and other staff welfare-oriented payment obligations.  There exist uncertainties as to the interpretation, implementation and enforcement of such obligations.  If relevant PRC governmental authorities determine that we have not complied fully with such obligations, we may be in violation of applicable PRC labor and social insurance laws, and we cannot assure you that PRC governmental authorities will not impose penalties on us for any failure to comply.  In addition, in the event that any current or former employee files a complaint with relevant PRC governmental authorities, we may be subject to making up such staff-welfare oriented obligations as well as paying administrative fines.  Our failure to comply with PRC labor laws could expose us to potential liability.  For example, in 2007, 2008 and 2009, we paid the amounts of $1 thousand, $2 thousand and $3 thousand, respectively, in connection with our pension, unemployment insurance, health insurance, employee housing, workplace injury and maternity obligations, or the Social Obligations, for such years.  We later determined that our contributions should have been $12 thousand, $29 thousand and $33 thousand for 2007, 2008 and 2009, respectively.  After further evaluation, however, we concluded that such amounts were understated by $20 thousand, $27 thousand and $41 thousand for 2007, 2008 and 2009, respectively.  Thus, taking into account the amounts that we paid, the Social Obligations that we owed for 2007, 2008 and 2009 were $31 thousand, $54 thousand and $71 thousand, respectively.  Under the Provisional Regulations on Collection and Payment of Social Insurance Premiums, or the Provisional Regulations, we would be subject to a daily fine of 0.2% for such amounts commencing on the day after each such contribution was initially due.  We recently contributed in full all such amounts.  Additionally, in December 2010, we obtained a “No-Objection” Letter issued by the Social Insurance Administration of Hanjiang District, or the Administration, which is the sole local governmental authority in charge of social insurance collection and supervision, and the issuing authority of our Social Insurance Registration Certificate.  According to the No-Objection Letter, the Administration will not require Grand Farm China to make up any previously unpaid social insurance or impose any fines on Grand Farm China for any such amounts.  Nevertheless, although the Administration is the sole authority in Hanjiang District for social insurance, and its decisions such as those in the No-Objection Letter are controlling as against any other equal-level authorities, there is no assurance that the No-Objection Letter will not be questioned and ultimately overturned by a higher authority.  Should the No-Objection Letter be overturned, we could be subject to fines under the Provisional Regulations of approximately $60 thousand, $70 thousand and $46 thousand for 2007, 2008 and 2009, respectively.

Risks Related to Our ADSs

We are a Cayman Islands exempted company and, because judicial precedent regarding the rights of shareholders is more limited under Cayman Islands law than that under U.S. law, our shareholders may have less protection for their shareholder rights than they would under U.S. law.

Our corporate affairs are governed by our memorandum and articles of association, the Cayman Islands Companies Law (2010 Revision) (referred to below as the Companies Law) and the common law of the Cayman Islands.  The rights of shareholders to take action against our directors, actions by minority shareholders and the fiduciary responsibilities of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands.  The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from English common law, which has persuasive, but not binding, authority on a court in the Cayman Islands.  The rights of our shareholders and the fiduciary responsibilities of our directors under Cayman Islands law are not as clearly established as they would be under statutes or judicial precedent in some jurisdictions in the United States.  In particular, the Cayman Islands has a less developed body of securities laws.

You may have difficulty enforcing judgments obtained against us and our management since we are not a corporation organized under the laws of a state within the United States and because all our assets and management members are located outside the United States.

We are a Cayman Islands exempted company and all of our assets are located outside of the United States.  Substantially all of our current operations are conducted in the PRC.  In addition, all of our directors and executive officers are nationals and residents of countries other than the United States.  A substantial portion of the assets of these persons are located outside the United States.  As a result, it may be difficult, if not impossible, for you to effect service of process within the United States upon these persons.  It may also be difficult for you to enforce in Cayman Islands courts or PRC courts judgments obtained in U.S. courts based on the civil liability provisions of the U.S. federal securities laws against us and our officers and directors, all of whom are not residents in the United States and the substantial majority of whose assets are located outside of the United States.  In addition, there is uncertainty as to whether the courts of the Cayman Islands or the PRC would recognize or enforce judgments.  B&D Law Firm, our PRC counsel, has advised us that China does not have treaties with the United States, the Cayman Islands or many other countries that provide the reciprocal recognition and enforcement of judgments of courts.

Although there is no statutory enforcement in the Cayman Islands of judgments obtained in the U.S., the courts of the Cayman Islands may recognize a foreign judgment as the basis for a claim at common law in the Cayman Islands provided such judgment:

· is given by a foreign court of competent jurisdiction;

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· imposes on the judgment debtor a liability to pay a liquidated sum for which the judgment has been given;

· is final;

· is not in respect of taxes, a fine or a penalty; and

· was not obtained in a manner and is not of a kind the enforcement of which is contrary to the public policy of the Cayman Islands.

As a result of all of the above, public shareholders may have substantially more difficulty in protecting their interests in the face of actions taken by management, members of the board of directors or controlling shareholders than they would as public shareholders of a U.S. company.  See “Enforcement of Civil Liabilities.”

The market price for our ADSs may be subject to wide fluctuations and our securities may trade below the initial public offering price.

The initial public offering price of our ADSs will be determined by negotiations between us and representatives of the underwriters, based on numerous factors we discuss under “Underwriting.”  This price may not be indicative of the market price of our ADSs after this offering.  We cannot assure you that you will be able to resell your ADSs at or above the initial public offering price or our net asset value.  The securities of a number of Chinese companies and companies with substantial operations in China have also experienced wide fluctuations subsequent to their initial public offerings, including trading at prices substantially below the initial public offering prices.  Among the factors that could affect the price of our ADSs are risk factors described in this section and other factors, including:

· announcements of competitive developments, including new products by our competitors;

· regulatory developments in our target markets affecting us, our customers or our competitors;

· actual or anticipated fluctuations in our quarterly operating results;

· failure of our quarterly financial and operating results to meet market expectations or failure to meet our previously announced guidance;

· changes in financial estimates by securities research analysts;

· changes in the economic performance or market valuations of other farming or agricultural companies;

· availability or shortages of rice grain and other raw materials;

· any natural disasters;

· additions or departures of our executive officers and other key personnel;

· announcements regarding intellectual property litigation (or potential litigation) involving us or any of our directors and officers;

· fluctuations in the exchange rates between the U.S. dollar and the Renminbi;

· release or expiration of the underwriter’s post-offering lock-up or other transfer restrictions on our outstanding securities; and

· sales or perceived sales of additional shares or ADSs.

In addition, the securities markets have from time to time experienced significant price and volume fluctuations that are not related to the operating performance of particular industries or companies.  For example, the capital and credit markets have been experiencing volatility and disruption for more than 24 months.  Starting in September 2008, the volatility and disruption in the securities markets reached extreme levels, developing into a global crisis.  As a result, stock prices of a broad range of companies worldwide, whether or not they are related to financial services, have declined significantly.  These market fluctuations may also have a material adverse effect on the market price of our ADSs.

We have considerable discretion in the use of proceeds from this offering and we may use these proceeds in ways with which you may not agree.

We intend to use the net proceeds from this offering for general corporate purposes, including capital expenditures.  We have not allocated the net proceeds of this offering to any particular project.  Rather, our board of directors and our management will have considerable discretion in the application of the net proceeds received by us.  You will not have the opportunity, as part of your investment decision, to assess whether proceeds are being used appropriately.  You must rely on the judgment of our board of directors and our management regarding the application of the net proceeds of this offering.  The net proceeds may be used for corporate purposes that do not improve our efforts to maintain profitability or increase our ADSs price.  The net proceeds from this offering may be placed in investments that do not produce income or that lose value.

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There has been no public market for our ADSs or our ordinary shares underlying the ADSs prior to this offering, and you may not be able to resell our ADSs at or above the price you paid, or at all.

Prior to this initial public offering, there has been no public market for our ADSs or our ordinary shares underlying the ADSs.  With the exception of the listing of our ADSs on the NASDAQ Capital Market, which we expect to occur concurrently with the closing of this offering, our ADSs and ordinary shares will not be listed or quoted for trading on any exchange.  If an active trading market for our ADSs does not develop after this offering, the market price and liquidity of our shares will be materially and adversely affected.

The initial public offering price for our ADSs will be determined by negotiations between us and representatives of the underwriters and may bear no relationship to the market price for our ADSs after the initial public offering.  We cannot assure you that an active trading market for our shares will develop or that the market price of our ADSs will not decline below the initial public offering price.

You will experience immediate and substantial dilution in the net tangible book value of ADSs purchased.

The initial public offering price per share will be substantially higher than the net tangible book value per share prior to this offering.  Consequently, when you purchase ADSs in this offering at the initial public offering price of $      per share, you will incur immediate dilution of $      per share.  See “Dilution.”  In addition, you may experience further dilution to the extent that additional ADSs are issued upon settlement of restricted share units or exercise of options that we may grant from time to time.

We may need additional capital and may sell additional ADSs or other equity securities or incur indebtedness, which could result in additional dilution to our shareholders or create debt service obligations for us.

We may require additional cash resources due to changed business conditions or other future developments, including any investments or acquisitions we may decide to pursue.  If our cash resources are insufficient to satisfy our cash requirements, we may seek to sell additional equity or debt securities or obtain a credit facility.  The sale of additional equity securities or equity-linked debt securities could result in additional dilution to our shareholders.  The incurrence of indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations.  We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all.

Substantial future sales of our ADSs in the public market, or the perception that these sales could occur, could cause the price of our ADSs to decline.

Additional sales of our ADSs or ordinary shares in the public market after this offering, or the perception that these sales could occur, could cause the market price of our ADSs to decline.  Upon completion of this offering, we will have       ADSs outstanding.  All ADSs sold in this offering, other than ADSs held by persons deemed to be our “affiliates,” will be freely transferable without restriction under the Securities Act.  ADSs held by our affiliates will be available for sale upon the expiration of the 12-month lock-up period beginning from the date of this prospectus, subject to volume and other restrictions as applicable under Rule 144 under the Securities Act.  Any or all of these ADSs may be released prior to expiration of the lock-up period at the discretion of our underwriter for this offering. In addition, we may grant or sell additional options, restricted ADSs or other ordinary share-based awards in the future to our management, employees and other persons, the settlement and sale of which may further dilute our shares and drive down the price of our ADSs.

27

Because we do not expect to pay dividends in the foreseeable future after this offering, you must rely on price appreciation of our ADSs for return on your investment.

We currently intend to retain most, if not all, of our available funds and any future earnings after this offering to fund the development and growth of our business.  As a result, we do not expect to pay any cash dividends in the foreseeable future.  Therefore, you should not rely on an investment in our ADSs as a source for any future dividend income.

Our board of directors has complete discretion as to whether to distribute dividends.  Even if our board of directors decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors.  Accordingly, the return on your investment in our ADSs will likely depend entirely upon any future price appreciation of our ADSs.  There is no guarantee that our ADSs will appreciate in value after this offering or even maintain the price at which you purchased the ADSs.  You may not realize a return on your investment in our ADSs and you may even lose your entire investment in our ADSs.

One of our directors and officers controls a significant amount of our ordinary shares and his interests may not align with the interests of our other shareholders.

Mr. Jianshan Yao, our Chairman of the Board of Directors, currently has beneficial ownership to approximately 84.79% of our issued and outstanding ordinary shares.  This significant concentration of share ownership may adversely affect the trading price of our ADSs because investors often perceive a disadvantage in owning shares in a company with one or several controlling shareholders.  Furthermore, our directors and officers, as a group, have the ability to significantly influence or control the outcome of all matters requiring shareholder approval, including electing directors and approving mergers or other business combination transactions.  This concentration of ownership and voting power may also discourage, delay or prevent a change in control of our company, which could deprive our shareholders of an opportunity to receive a premium for their shares as part of a sale of our company that might reduce the price of our ADSs.  These actions may be taken even if they are opposed by our other shareholders, including those who purchase ADSs in this offering.

If we fail to maintain an effective system of internal controls, we may be unable to accurately report our financial results or prevent fraud, and investor confidence and the market price of our ADSs may be adversely affected.

Our reporting obligations as a public company will place a significant strain on our management, operational and financial resources and systems for the foreseeable future.  We are a relatively young company with limited accounting personnel and other resources with which to address our internal controls and procedures.  In addition, we must implement financial and disclosure control procedures and corporate governance practices that enable us to comply, on a stand-alone basis, with the Sarbanes-Oxley Act of 2002 and related Securities and Exchange Commission, or the SEC, rules.  For example, we will need to further develop accounting and financial capabilities, including the establishment of an internal audit function and development of documentation related to internal control policies and procedures.  Failure to quickly establish the necessary controls and procedures would make it difficult to comply with SEC rules and regulations with respect to internal control and financial reporting.  We will need to take further actions to continue to improve our internal controls.  If we are unable to implement solutions to any weaknesses in our existing internal controls and procedures, or if we fail to maintain an effective system of internal controls in the future, we may be unable to accurately report our financial results or prevent fraud and investor confidence and the market price of our ADSs may be adversely impacted.

In the past, we have advanced funds to certain of our officers and shareholders and we have also transferred corporate funds into the personal bank account of an employee of the Company for payment of business expenses.  For additional information regarding these transactions, see “Related Party Transactions.”  We are in the process of instituting changes to our internal controls and management systems to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act of 2002.  Section 404 requires us to perform an evaluation of our internal controls over financial reporting and file annual management assessments of their effectiveness with the SEC.  The management assessment to be filed is required to include a certification of our internal controls by our chief executive officer and chief financial officer.  In addition to satisfying requirements of Section 404, we may also make improvements to our management information system to computerize certain manual controls, establish a comprehensive procedures manual for US GAAP financial reporting, and increase the headcount in the accounting and internal audit functions with professional qualifications and experience in accounting, financial reporting and auditing under US GAAP.

28

Our auditors will be required to attest to our evaluation of internal controls over financial reporting.  Unless we successfully design and implement changes to our internal controls and management systems, or if we fail to maintain the adequacy of these controls as such standards are modified or amended from time to time, we may not be able to comply with Section 404 of the Sarbanes-Oxley Act of 2002.  As a result, our auditors may be unable to attest to the effectiveness of our internal controls over financial reporting.  This could subject us to regulatory scrutiny and result in a loss of public confidence in our management, which could, among other things, adversely affect the price of our ADSs and our ability to raise additional capital.

We may be classified as a passive foreign investment company, or PFIC, which could result in adverse U.S. federal income tax consequences to U.S. investors.

In general, we will be treated as a PFIC for any taxable year in which either (1) at least 75% of our gross income (looking through certain 25% or more-owned corporate subsidiaries) is passive income or (2) at least 50% of the average value of our assets (looking through certain 25% or more-owned corporate subsidiaries) is attributable to assets that produce, or are held for the production of, passive income.  Passive income generally includes, without limitation, dividends, interest, rents, royalties, and gains from the disposition of passive assets.  If we are determined to be a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. Holder (as defined in the section of this prospectus captioned “Taxation — United States Federal Income Taxation — General”) of our ADSs or ordinary shares, the U.S. Holder may be subject to increased U.S. federal income tax liability and may be subject to additional reporting requirements.  Based on the expected composition (and estimated values) of the assets and the nature of the income of us and our subsidiaries and our current plans of operation, we do not expect to be treated as a PFIC for the current taxable year or in the near future.  However, our actual PFIC status for our current taxable year or any subsequent taxable year will not be determinable until after the end of such taxable year.  Accordingly, there can be no assurance with respect to our status as a PFIC for our current taxable year or any subsequent taxable year.  We urge U.S. investors to consult their own tax advisors regarding the possible application of the PFIC rules.  For a more detailed explanation of the tax consequences of PFIC classification to U.S. Holders, see the section of this prospectus captioned ‘‘Taxation — United States Federal Income Taxation — U.S. Holders — Passive Foreign Investment Company Rules.”

We will incur increased costs as a result of being a public company, which will adversely impact our results of operations.

Upon closing of this offering, we will become a public company and expect to incur significant legal, accounting and other expenses that we did not incur as a private company. Moreover, the Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the Securities and Exchange Commission, have imposed additional requirements on corporate governance practices of public companies.  We expect these rules and regulations to increase our legal and financial compliance costs and to make some corporate activities more time-consuming and costly.  For example, as a result of becoming a public company, we will need to add independent directors to our board and adopt policies regarding internal controls and disclosure controls and procedures. In addition, we will incur additional costs associated with our public company reporting requirements.  It may also be difficult for us to attract and retain qualified persons to serve on our board of directors due to increased risks of liability to our directors under the rules and regulations.  We are currently evaluating and monitoring developments with respect to these rules and regulations, and we cannot predict or estimate with any degree of certainty the amount or timing of additional costs we may incur.

Although our results of operations, cash flows and financial condition reflected in our combined and consolidated financial statements include all of the expenses allocable to our business, because of the additional administrative and financial obligations associated with operating as a publicly traded company, they may not be indicative of the results of operations that we would have achieved had we operated as a public entity for all periods presented or of future results that we may achieve as a publicly traded company with our current holding company structure.  Such variations may be material to our business.

29

Holders of ADSs must act through the depositary to exercise their rights as shareholders of our company.

Holders of our ADSs do not have the same rights of our shareholders and may only exercise the voting rights with respect to the underlying ordinary shares in accordance with the provisions of the deposit agreement for the ADSs. Under our amended and restated memorandum and articles of association that will become effective upon completion of this offering, the minimum notice period required to convene a general meeting is seven days.  When a general meeting is convened, you may not receive sufficient notice of a shareholders' meeting to permit you to withdraw your ordinary shares to allow you to cast your vote with respect to any specific matter.  In addition, the depositary and its agents may not be able to send voting instructions to you or carry out your voting instructions in a timely manner.  We will make all reasonable efforts to cause the depositary to extend voting rights to you in a timely manner, but we cannot assure you that you will receive the voting materials in time to ensure that you can instruct the depositary to vote the ordinary shares underlying your ADSs.  Furthermore, the depositary and its agents will not be responsible for any failure to carry out any instructions to vote, for the manner in which any vote is cast or for the effect of any such vote.  As a result, you may not be able to exercise your right to vote and you may lack recourse if the ordinary shares underlying your ADSs are not voted as you requested.  In addition, in your capacity as an ADS holder, you will not be able to call a shareholders' meeting.

The depositary for our ADSs will give us a discretionary proxy to vote our ordinary shares underlying your ADSs if you do not vote at shareholders' meetings, except in limited circumstances, which could adversely affect your interests.

Under the deposit agreement for the ADSs, the depositary will give us a discretionary proxy to vote our ordinary shares underlying your ADSs at shareholders' meetings if you do not vote, unless:

· we have failed to timely provide the depositary with our notice of meeting and related voting materials;

· we have instructed the depositary that we do not wish a discretionary proxy to be given;

· we have informed the depositary that there is substantial opposition as to a matter to be voted on at the meeting; or

· a matter to be voted on at the meeting would have a material adverse impact on shareholders.

The effect of this discretionary proxy is that you cannot prevent our ordinary shares underlying your ADSs from being voted, absent the situations described above, and it may make it more difficult for shareholders to influence the management of our company.  Holders of our ordinary shares are not subject to this discretionary proxy.

Your right to participate in any future rights offerings may be limited, which may cause dilution to your holdings, and you may not receive cash dividends if it is impractical to make them available to you.

We may from time to time distribute rights to our shareholders, including rights to acquire our securities. However, we cannot make rights available to you in the United States unless we register both the rights and the securities to which the rights relate under the Securities Act or an exemption from the registration requirements is available.  Under the deposit agreement, the depositary will not make rights available to you unless both the rights and the underlying securities to be distributed to ADS holders are either registered under the Securities Act or exempt from registration under the Securities Act.  We are under no obligation to file a registration statement with respect to any such rights or securities or to endeavor to cause such a registration statement to be declared effective and we may not be able to establish a necessary exemption from registration under the Securities Act.  Accordingly, you may be unable to participate in our rights offerings and may experience dilution in your holdings.

The depositary of our ADSs has agreed to pay to you the cash dividends or other distributions it or the custodian receives on our ordinary shares or other deposited securities after deducting its fees and expenses.  You will receive these distributions in proportion to the number of ordinary shares your ADSs represent.  However, the depositary may, at its discretion, decide that it is inequitable or impractical to make a distribution available to any holders of ADSs.  For example, the depositary may determine that it is not practicable to distribute certain property through the mail, or that the value of certain distributions may be less than the cost of mailing them. In these cases, the depositary may decide not to distribute such property to you.

30

You may be subject to limitations on transfer of your ADSs.

Your ADSs are transferable on the books of the depositary.  However, the depositary may close its transfer books at any time or from time to time when it deems expedient in connection with the performance of its duties.  In addition, the depositary may refuse to deliver, transfer or register transfers of ADSs generally when our books or the books of the depositary are closed, or at any time if we or the depositary deems it advisable to do so because of any requirement of law or of any government or governmental body, or under any provision of the deposit agreement, or for any other reason.

As a foreign private issuer, we are permitted to, and we may, rely on exemptions from certain NASDAQ corporate governance standards applicable to U.S. issuers, including the requirement regarding the implementation of a nominating committee. This may afford less protection to holders of our ordinary shares and ADSs.

The NASDAQ Marketplace Rules in general require listed companies to have, among other things, a nominating committee consisting solely of independent directors and establishment of a formal director nomination process.  As a foreign private issuer, we are permitted to, and we may, follow home country corporate governance practices instead of certain requirements of the NASDAQ Marketplace Rules.  The corporate governance practice in our home country, the Cayman Islands, does not require the implementation of a nominating committee or establishment of a formal director nominations process.  As a result, the level of independent oversight over management of our company may afford less protection to holders of our ordinary shares and ADSs.

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FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements that are based on our management’s current expectations, assumptions, estimates and projections about us and our industry.  All such statements and any other statements of a future or forward-looking nature are forward-looking statements for the purposes of the United States federal securities law.  These forward-looking statements can be identified by words or phrases such as “may,” “expect,” “anticipate,” “estimate,” “plan,” “believe,” “is/are likely to” or other similar expressions or the negative of these words.  These forward-looking statements involve various risks and uncertainties.  Although we believe that our expectations expressed in these forward-looking statements are reasonable, we cannot assure you that our expectations will turn out to be correct.  Our actual results could be materially different from our expectations.  Important risks and factors that could cause our actual results to be materially different from our expectations are generally set forth in the sections entitled “Risk Factors”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business” sections and elsewhere in this prospectus.

This prospectus also contains data related to the general Chinese agricultural industry.  These market data include projections that are based on a number of assumptions.  The failure of this market to grow at the projected rate may have a material adverse effect on our business and the market price of our ADSs.  Furthermore, if any one or more of the assumptions underlying the market data turns out to be incorrect, actual results may differ from the projections, which are based on these assumptions.  You should not place undue reliance on these forward-looking statements.

The forward-looking statements made in this prospectus relate only to events or information as of the date on which the statements are made in this prospectus.  We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events.

32

USE OF PROCEEDS

We estimate that we will receive net proceeds from this offering of approximately $      million, or approximately $      million if the underwriters exercise their option to purchase additional ADSs to cover over-allotments in full, after deducting underwriting discounts and the estimated offering expenses payable by us and based upon an assumed initial offering price of $      per ADS.  A $1.00 increase (decrease) in the assumed public offering price of $      per ADS would increase (decrease) the net proceeds of this offering by $      million, assuming the sale of       ADSs at $      per share and after deducting underwriting discounts and commissions and the estimated offering expenses payable by us.

We expect to use the net proceeds we receive from this offering for the following purposes:

· consolidate our market share in Fujian and actively expand our sales channels into first-tier cities in provinces adjacent to Fujian, which we define as cities with population in excess of 1 million;

· develop direct sales to national chain supermarkets, chain retail outlets and agricultural trade centers;

· increase brand marketing in major targeted markets;

· actively market refined rice bran oil produced from newly established integrated production line;

· increase our production capacity of milled rice and refined rice bran oil; and

· general working capital.

We have not yet determined the final use of the net proceeds of this offering.  The amount and timing of what we actually spend for these purposes may vary significantly and will depend on a number of factors, including our future revenues and cash generated by operations, our expenditures, potential changes in strategy and the other factors we describe in “Risk Factors.”  We may find it necessary or advisable to use portions of the proceeds from this offering for other purposes.  Circumstances that may give rise to a change in the use of proceeds include:

· the existence of presently unknown strategic opportunities or the need to take advantage of changes in timing of our existing research, development and/or commercial activities; and/or

· the need or desire on our part to accelerate, increase or eliminate existing initiatives due to, among other things, changing market conditions and competitive developments.

From time to time, we evaluate these and other factors, and we anticipate continuing to make such evaluations to determine if our existing allocation of resources, including the proceeds of this offering, is being optimized.  Therefore, we will have broad discretion in the way we use the net proceeds from this offering.  Pending their ultimate use, we intend to invest the net proceeds from this offering primarily in investment grade, interest-bearing instruments.

33

DIVIDEND POLICY

We do not intend to pay any dividends in the future after completing this offering and becoming a publicly traded company, and expect to retain all available funds to support our operations and to finance the growth and development of our business.  We are not subject to any contractual restrictions on paying dividends.  The amount and payment of dividends will be determined by a simple majority vote at a general shareholders’ meeting, typically, but not necessarily, based on the recommendation of our Board of Directors.  Any future dividend declaration will be subject to various factors, including:

· the level of our cash and retained earnings;

· our expected financial performance;

· our projected levels of capital expenditure and other investment plans;

· the adequacy of our working capital; and

· the dividend yield of similarly listed companies with similar growth prospects as well as comparable agricultural companies.

No dividend payments shall be made other than out of our profits or the monies otherwise available for dividend distribution under Cayman Islands law.

Grand Farm Cayman is a holding company and its cash flow depends on the issuance of dividends to it from its wholly owned subsidiary, Grand Farm HK.  The ability of Grand Farm HK to pay dividends to Grand Farm Cayman depends on the issuance of dividends to Grand Farm HK from its wholly owned subsidiary, Grand Farm WFOE.  The ability of Grand Farm WFOE to pay dividends to Grand Farm HK is subject to various restrictions, including legal restrictions in China that permit payment of dividends only out of net income determined in accordance with PRC accounting standards and regulations.  Under the PRC laws, Grand Farm WFOE must allocate at least 10% of its after-tax profit to its statutory general reserve fund until the balance of the statutory general reserve fund has reached 50% of its registered capital.  Grand Farm WFOE may also allocate a portion of its after-tax profits, as determined by its board of directors, to its staff welfare and bonus funds which may not be distributed.

Any dividends paid by Grand Farm WFOE to Grand Farm HK, or from Grand Farm HK to Grand Farm Cayman, may be subject to PRC withholding tax under the PRC EIT Law and its implementing rules, both of which became effective on January 1, 2008.  In addition, Grand Farm Cayman may be subject to PRC taxes on dividends received from Grand Farm HK.  Any such taxes could materially reduce the amount of dividends, if any, Grand Farm Cayman could pay to its shareholders.  Any dividends Grand Farm Cayman pays to its shareholders that are not tax residents of the PRC also may be subject to PRC withholding taxes.  For a further discussion, see the sections entitled “Taxation — PRC Taxation” and “Risk Factors — Risks Relating to Doing Business in China — Under the PRC EIT Law, we and/or Grand Farm HK may be classified as a “resident enterprise” of the PRC.  Such classification could result in PRC tax consequences to us, Grand Farm HK and/or our non-PRC resident shareholders.”

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CAPITALIZATION

The following table sets forth our capitalization, as of March 31, 2011:

· on an actual basis; and

· on a pro forma, as adjusted basis to give effect to the issuance and sale of ADSs offered in this offering at an assumed public offering price of US$      per share, after deducting underwriting discounts, commissions and estimated offering expenses of US$     .

You should read this table in conjunction with “Operating and Financial Review and Prospects” and our financial statements and related notes included elsewhere in this prospectus. The information presented below is unaudited.

	As of March 31, 2011
	Actual (1)		Pro Forma As Adjusted (2)
	(In thousands)
Grand Farm’s Shareholders’ Equity
Ordinary shares, par value $0.002, 100,000,000 shares authorized, 25,000,000 shares issued and outstanding	$	50	$
Additional paid-in-capital	$	5,017	$
Statutory Reserves	$	2,901	$
Retained Earnings	$	25,562	$
Accumulated Other Comprehensive Income	$	2,501	$
Total Shareholders’ Equity	$	36,361	$
Total Liabilities and Shareholders’ Equity (3)	$	56,302	$
Total Capitalization (3)	$	5,067	$

(1) Unaudited

(2) The as adjusted information discussed above is illustrative only.  Our additional paid-in capital, total shareholders’ equity and total capitalization following the completion of this offering are subject to adjustment based on the actual public offering price and other terms of this offering determined at pricing.

(3) Assuming the number of ADSs offered by us as set forth on the cover page of this prospectus remains the same, and after deduction of underwriting discounts and commissions and the estimated offering expenses payable by us, a US$1.00 increase (decrease) in the assumed public offering price of US$      per share would increase (decrease) each of total shareholders’ equity and total capitalization by US$      million.

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DILUTION

If you invest in our ADSs, your interest will be diluted to the extent of the difference between the public offering price per share and our net tangible book value per share after this offering.  Dilution results from the fact that the public offering price per share is substantially in excess of the book value per share attributable to the existing shareholders for our presently outstanding ordinary shares.

Our net tangible book value as of December 31, 2010, was approximately US$31,932 thousand, or US$1.28 per ordinary share outstanding at that date.  Net tangible book value is determined by subtracting the value of our intangible assets and total liabilities from our total assets.  Dilution is determined by subtracting net tangible book value per ordinary share from the assumed public offering price per share of US$      per share.

Without taking into account any other changes in such net tangible book value after June 30, 2010, other than to give effect to our sale of the ADSs offered in this offering at the assumed public offering price of US$      per ADS, with estimated net proceeds of US$      million after deducting underwriting discounts and commissions and estimated offering expenses, our pro forma net tangible book value at $      million would have been US$      million, or US$      per outstanding ADS.  This represents an immediate increase in pro forma net tangible book value of US$      per ordinary share to existing shareholders and an immediate dilution in pro forma net tangible book value of      % per ordinary share or US$      per ordinary share or US$      per ADS to new investors in this offering.

The following table illustrates this per share dilution:

Assumed public offering price per ADS	$
Net tangible book value per ADS at US$	$
Increase in net tangible book value per ADS attributable to this offering	$
Net tangible book value per ADS as of December 31, 2009 after giving effect to the offering	$
Dilution in net tangible book value per ADS to new investors in the offering	$

The following table summarizes on a pro forma basis the differences as of December 31, 2010 between the shareholders at our most recent fiscal year end and the new investors with respect to the number of ADSs purchased from us, the total consideration paid and the average price per ADS paid.  The total ADSs do not include shares issuable if the underwriters exercise their option to purchase additional ADSs to cover over-allotments.

	Shares Held					Total Investment
	Number		Percentage of the Company			Percentage of Voting Rights			Amount		Percentage of Investment			Average Cost Per Share
Existing Shareholders		25,000,000		100	%		100	%	$	50,000		100	%	$	0.002
New Investors					%			%					%
Total					%			%					%

The foregoing tables assume no exercise of the underwriters’ purchase option.

A US$1.00 increase (decrease) in the assumed public offering price of US$      per ADS would increase (decrease) our adjusted net tangible book value after giving effect to the offering by US$      million, the adjusted net tangible book value per share after giving effect to this offering by US$      per ADS and the dilution in adjusted net tangible book value per ADS, assuming no change to the number of shares offered by us as set forth on the cover page of this prospectus, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

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EXCHANGE RATE INFORMATION

We conduct our business in China and substantially all of our revenues are denominated in Renminbi. However, periodic reports made to shareholders will be expressed in U.S. dollars using the then current exchange rates.  This prospectus contains conversions of Renminbi amounts into U.S. dollars at specified rates solely for the convenience of the reader.  Unless otherwise noted, all conversions from Renminbi to U.S. dollars were made at the noon buying rate in The City of New York for cable transfers in Renminbi per U.S. dollar as certified for customs purposes by the Federal Reserve Bank of New York, as of December 31, 2010, which was RMB 6.61180 to US$1.00.  No representation is made that the Renminbi amounts referred to in this prospectus could have been or could be converted into U.S. dollars at any particular rate or at all.  On May 10, 2011, the noon buying rate was RMB 6.50130 to US$1.00.

The following table sets forth information concerning exchange rates between the Renminbi and the U.S. dollar for the periods indicated.

	Renminbi per U.S. Dollar Noon Buying Rate
	Average(1)		High		Low		Period-End
Year ended December 31, 2007		7.4197		7.7345		7.0105		7.0120
Year ended December 31, 2008		6.8532		6.9870		6.7899		6.8329
Year ended December 31, 2009		6.8286		6.8371		6.8176		6.8258
2009
January		6.8360		6.8403		6.8225		6.8392
February		6.8362		6.8470		6.8241		6.8395
March		6.8360		6.8438		6.8240		6.8329
April		6.8304		6.8361		6.8180		6.8180
May		6.8235		6.8326		6.8176		6.8278
June		6.8334		6.8371		6.8264		6.8245
July		6.8317		6.8342		6.8300		6.8319
August		6.8324		6.8358		6.8300		6.8300
September		6.8291		6.8303		6.8247		6.8262
October		6.8269		6.8287		6.8248		6.8264
November		6.8271		6.8300		6.8255		6.8265
December		6.8275		6.8299		6.8244		6.8259
2010
January		6.8269		6.8295		6.8258		6.8268
February		6.8292		6.8346		6.8260		6.8260
March		6.8263		6.8270		6.8255		6.8258
April		6.8256		6.8275		6.8229		6.8247
May		6.8275		6.8310		6.8245		6.8305
June		6.8227		6.8323		6.7911		6.7911
July		6.78611		6.78130		6.75950		6.78520
August		6.79603		6.79820		6.75470		6.8130
September		6.75811		6.80550		6.67460		6.69810
October		6.67726		6.69050		6.63100		6.67180
November		6.66261		6.68620		6.61200		6.67140
December		6.66103		6.66810		6.58200		6.61180
2011
January		6.60455		6.62860		6.54830		6.58330
February		6.58708		6.59480		6.53970		6.5830
March		6.57635		6.57400		6.52200		6.57010
April		6.53702		6.54860		6.46350		6.49950
May (through May 10)		6.50024		6.50200		6.48000		6.50130

Source: Federal Reserve Bank of New York

(1) Annual averages are calculated from month-end rates. Monthly and interim period averages are calculated using the average of the daily rates during the relevant period.

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ENFORCEABILITY OF CIVIL LIABILITIES

We are a Cayman Islands exempted company with limited liability.  Substantially all of our current operations are conducted in China and substantially all of our assets are located in China.  Furthermore, all or most of our directors and officers and some experts named in this prospectus reside outside the United States and a substantial portion of their assets are located outside the United States.  As a result, investors may not be able to effect service of process within the United States upon us or our directors or officers or some experts or to enforce against us or them in United States courts judgments predicated upon the civil liability provisions of U.S. federal securities laws.

There is doubt as to the enforceability of original actions in the Cayman Islands or the People’s Republic of China courts of civil liabilities predicated solely upon U.S. federal securities laws.  The enforceability of judgments entered by U.S. courts predicated upon the civil liability provisions of U.S. federal securities laws in the Cayman Islands or the PRC’s courts of civil liabilities will be subject to compliance with procedural requirements under Cayman Islands or Chinese law, including the condition that the judgment does not violate Cayman Islands and Chinese public policy.

Although there is no statutory enforcement in the Cayman Islands of judgments obtained in the U.S., the courts of the Cayman Islands may recognize a foreign judgment as the basis for a claim at common law in the Cayman Islands provided such judgment:

· is given by a foreign court of competent jurisdiction;

· imposes on the judgment debtor a liability to pay a liquidated sum for which the judgment has been given;

· is final;

· is not in respect of taxes, a fine or a penalty; and

· was not obtained in a manner and is not of a kind the enforcement of which is contrary to the public policy of the Cayman Islands.

As a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of the board of directors or controlling shareholders than they would as public shareholders of a U.S. company.

For additional information with regard to enforcement of civil liabilities, see “Risk Factors — You may experience difficulties in effecting service of legal process, enforcing foreign judgments or bringing original actions in China based on United States or other foreign laws against us and our management.” and “Risk Factors — Uncertainties with respect to the PRC legal system could adversely affect us.”

We have appointed Puglisi & Associates, located at 850 Library Avenue, Suite 204, Newark, Delaware 19711, as our agent to receive service of process with respect to any action brought against us in the United States District Court for the Southern District of New York under the federal securities laws of the United States or of any state in the United States or any action brought against us in the Supreme Court of the State of New York in the County of New York under the securities laws of the State of New York.

38

SELECTED FINANCIAL AND OPERATING DATA

The following selected financial and operating data as of and for the years ended December 31, 2008, 2009 and 2010, have been derived from our audited consolidated financial statements for the years ended December 31, 2008, 2009 and 2010 that are included elsewhere in this prospectus, and should be read in conjunction with such financial statements and the accompanying notes and “Operating and Financial Review and Prospects” beginning on page 40 of this prospectus.  The selected financial and operating data as of and for the year ended December 2007 have been derived from our audited combined financial statements for such year, which are not included in this prospectus.  Our results of operations in any period may not necessarily be indicative of the results that may be expected for any future period. See “Risk Factors” beginning on page 10 of this prospectus.  In accordance with Item 3.A.1 of Form 20-F, we are omitting our selected combined financial data for fiscal year 2006 because we do not currently have audited financial statements for such year and such information cannot be provided in accordance with US GAAP without unreasonable effort or expense.

	For the fiscal year ended  December 31,
	2007			2008			2009			2010
	(In thousands, except for per share data)
Revenues	$	15,166		$	36,007		$	60,533		$	82,189
Income from operations		2,592			5,886			12,891			14,843
Other expense		(582	)		(942	)		(847	)		(769	)
Net income		1,333			4,941			12,071			14,095
Net income per share
- Basic		0.05			0.20			0.48		$	0.56
- Diluted		0.05			0.20			0.48			0.56

	December 31,
	2007		2008		2009			2010
	(In thousands)
Total assets	$	19,921	$	30,068		$	44,175	$	54,085
Total liabilities		11,092		15,594			17,623		22,153
Total shareholders’ equity		8,829		14,474			26,552		31,932
Total liabilities and shareholders’ equity	$	19,921	$	30,068		$	44,175	$	54,085

39

OPERATING AND FINANCIAL REVIEW AND PROSPECTS

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the section titled “Selected Historical Financial and Operating Data” and the financial statements included elsewhere in this prospectus. This discussion and analysis may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in “Risk Factors” of this prospectus.

Overview

We are a leading China-based rice producer.  We produce milled rice products from our facilities in Putian, Fujian Province, and distribute throughout the province.  Our principal products include rice and nutrition-fortified rice sold under the “Grand Farm” brand, which we sell to distributors for wholesale and retail distributions.  We also sell milled rice to beer manufacturers as raw materials.

We are in the process of launching our refined rice bran oil, which we will initially produce from rice bran removed during our rice milling process.  We have established a production line for refined rice bran oil at one of our two production facilities in Putian, and plan to commence formal production and distribution immediately after we obtain a Production License anticipated by the end of May 2011.

All of our business operations are carried out in China by Grand Farm China, which we control through a series of contractual arrangements between Grand Farm China and its owners, on the one hand, and our PRC subsidiary, Grand Farm WFOE, on the other hand.  For a description of these contractual arrangements and their impact on our financial results, please see “Our Corporate History and Structure – Contractual Arrangements with Grand Farm China and its Equity Owners” elsewhere in this prospectus and Note 1 to our combined financial statements for the years ended December 31, 2008, 2009 and 2010 included in this prospectus.

Since we began our operations in May 2001, we have expanded our operations driven by growing market demand for premium-grade rice.  Our revenues were $36 million, $61 million and $82 million in 2008, 2009 and 2010, respectively.  We had net income of $5 million, $12 million and $14 million in 2008, 2009 and 2010, respectively.  Our business is operated as a single segment.

Basis of Presentation

Our financial statements were prepared in conformity with United States generally accepted accounting principles (US GAAP).  Our functional currency is the Chinese Renminbi (RMB), however, our financial statements were translated and presented in United States Dollars ($).

Use of Estimates

The preparation of the consolidated financial statements for the years ended December 31, 2008, 2009 and 2010 in conformity with US GAAP 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 dates of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods.  Estimates are adjusted to reflect actual experience when necessary.  Significant accounting estimates reflected in the Company’s combined financial statements include inventory valuation and useful lives of plant and equipment.  Actual results could differ from those estimates.

Critical Accounting Estimates

The preparation of our consolidated financial statements for the years ended December 31, 2008, 2009 and 2010 and related notes requires us to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, net sales and expenses, and related disclosure of contingent assets and liabilities.  We have based our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

40

An accounting policy is considered to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the consolidated financialstatements.  We believe that the following critical accounting policies are the most sensitive and are those that require the more significant estimates and assumptions used in the preparation of our consolidated financial statements.  You should read the following descriptions of critical accounting policies, judgments and estimates in conjunction with our consolidated financial statements and other disclosures included with this prospectus.

Revenue Recognition

We derive our revenue primarily from the sales of rice and related by-products.  We sell milled rice through cash and credit sales.  For cash sales, we recognize revenue, net of 13% value added taxes, upon receiving cash from the customers.  For credit sales, we recognize revenue, net of 13% value added taxes, upon delivery, at which time title passes to the customer provided that: there are no uncertainties regarding customer acceptance; persuasive evidence of an arrangement exists; the sales price is fixed and determinable; and collectability is deemed probable.  We do not engage in consigned sales.  Historically, returns have been immaterial.

Income taxes

In preparing our combined financial statements, we must estimate our income taxes in each of the jurisdictions in which we operate.  We estimate our actual tax exposure and assess temporary differences resulting from different treatment of items for tax and accounting purposes.  These differences result in deferred tax assets and liabilities, which we include in our consolidated balance sheets.  We must then assess the likelihood that we will recover our deferred tax assets from future taxable income.  If we believe that recovery is not likely, we must establish a valuation allowance.  To the extent we establish a valuation allowance or increase this allowance, we must include an expense within the tax provision in our statement of operations.

Management must exercise significant judgment to determine our provision for income taxes, our deferred tax assets and liabilities and any valuation allowance recorded against our net deferred tax assets.  We base the valuation allowance on our estimates of taxable income in each jurisdiction in which we operate and the period over which our deferred tax assets will be recoverable.  If actual results differ from these estimates or we adjust these estimates in future periods, we may need to establish an additional valuation allowance, which could materially impact our financial position and results of operations.

U.S. GAAP requires that an entity recognize the impact of an uncertain income tax position on the income tax return at the largest amount that is more likely than not to be sustained upon audit by the relevant tax authority.  If we ultimately determine that payment of these liabilities will be unnecessary, we will reverse the liability and recognize a tax benefit during that period.  Conversely, we record additional tax charges in a period in which we determine that a recorded tax liability is less than the expected ultimate assessment.  We did not recognize any significant unrecognized tax benefits during the periods presented in this prospectus.

Since the adoption of Under the Notice Regarding Preferential Enterprise Income Tax on Primary Processing of Agricultural Products, or Circular 2008-149, issued by the PRC’s State Administration of Taxation, or SAT, on November 20, 2008 and effective retroactively from January 1, 2008, we have been exempted from the PRC’s enterprise income tax, or EIT, since January 1, 2008, because our business operations in China meet its requirements.  Circular 2008-149 currently has no expiration date.  Refined rice bran oil, which we plan to formally commence production immediately after obtaining a Production License anticipated by the end of May 2011, is not covered under Circular 2008-149 (although unrefined, or crude, rice bran oil is).  As such, revenues to be generated from such product will be subject to the standard EIT rate of 25% unless we can qualify as a “high-technology company” in connection with the production of such product, which would reduce the EIT rate to 15%.  There is no assurance, however, as to when we can secure such qualification, if at all.

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Moreover, uncertainties exist with respect to the application of the Enterprise Income Tax Law of PRC, or EIT Law, and its implementing rules to our operations, specifically with respect to our tax residency status.  The EIT Law specifies that legal entities organized outside of the PRC will be considered residents for PRC income tax purposes if their “de facto management bodies” are located within the PRC.  The EIT Law’s implementation rules define the term “de facto management bodies” as “establishments that carry out substantial and overall management and control over the manufacturing and business operations, personnel, accounting, properties, etc. of an enterprise.”

Given the uncertainties resulting from limited PRC tax guidance on the issue, it remains unclear whether our legal entities organized outside of the PRC constitute residents under the EIT Law.  If one or more of our legal entities organized outside of the PRC were characterized as PRC tax residents, the impact would adversely affect our results of operations. See “Risk Factors — Risk Related to Doing Business in China — Under the PRC EIT Law, we may be classified as a ‘resident enterprise’ of the PRC.  Such classification could result in PRC tax consequences to us and/or our non-PRC resident ADS holders or shareholders.”

Recently Issued Accounting Pronouncements

In January 2010, the FASB issued ASU 2010-06, “Fair Value Measurements and Disclosure (Topic 820): Improving Disclosures about Fair Value Measurements (“ASU 2010-06”). ASU 2010-06 amends ASC Topic 820 to require additional disclosures regarding fair value measurements. One of the areas concerned is related to the inclusion of information about purchases, sales, issuances and settlements in the reconciliation of recurring Level 3 measurements. Such disclosure requirements will be effective for annual reporting periods beginning after December 15, 2010 and for interim periods within those fiscal years.  We evaluated the effect of ASC 2010-06 on our financial statements and believe that this ASU is only related to disclosures and would have no impact on our financial positions, results of operation and cash flows.

In April 2010, the FASB issued ASU 2010-13, “Effect of Denominating the Exercise Price of a Share-Based Payment Award in the Currency of the Market in Which the Underlying Equity Security Trades,” or ASU 2010-13, which addresses the classification of a share-based payment award with an exercise price denominated in the currency of a market in which the underlying equity security trades.  FASB ASC Topic 718, “Compensation—Stock Compensation,” was amended to clarify that a share-based payment award with an exercise price denominated in the currency of a market in which a substantial portion of the entity’s equity securities trade shall not be considered to contain a market, performance or service condition.  Therefore, such an award is not to be classified as a liability if it otherwise qualifies for equity classification.  The amendments will be effective for fiscal years beginning on or after December 15, 2010 and interim reporting periods within those fiscal years, with early application permitted.  We evaluated the effect of ASU 2010-13 on our financial statements and have concluded that it would have no impact on our financial positions, results of operation and cash flows.

Factors Affecting Our Financial Condition and Results of Operations

Our results of operations are affected by several key factors, including the following:

· General economic conditions affecting the rice processing industry in China

The inflationary condition in China may influence the price of our products.  The year-over-year increase of China’s Consumer Price Index (CPI) in December 2010 was reported at 4.6%.  Due to such overall inflationary condition coupled with market-driven pricing and supply adjustments throughout 2010, especially short/medium shaped rice grain, the prices of rice products throughout China, including ours, have increased since the beginning of 2010.  However, given the role of rice as the staple food source for a majority of China’s population, we believe that the central government will take such measures as it may deem necessary in order to stabilize the price of rice grain.  In addition, favorable weather conditions during late 2010 resulted in favorable crop yields that we believe are sufficient to supply market demands through the first half of 2011.  Under such scenario, we believe that the likelihood of continuing increases in the price of rice grain, and thus our products, may be less likely in the near future, but do expect prices in 2011 to stay at the levels reached at the end of 2010.  Nevertheless, we increased our inventory of rice grains significantly in 2009 and took steps in 2010 to source rice grains for less costs (such as from state-owned reserves), in order to control costs while providing for anticipated production requirements in the near terms.  At the same time, if inflation continues unabated, we may seek to pass along the costs to our customers in order minimize the impact on our margins, develop and market higher-margin products, and/or bypass our distributors to sell directly to retailers.

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· Our ability to secure and maintain sufficient supply of rice grains of the types and standards for our production needs

In 2009, we sourced approximately 93% of our short/medium-shaped rice grain from Panjin, in northeastern China.  In 2010, however, a moderate decrease in short/medium-shaped rice grain (as compared to 2009) against a fast growing market demand led many grain suppliers in northeastern China, including ours in Panjin, to raise prices to levels that we believe are above normal inflationary adjustments.  Intentional supply tightening by these suppliers further exacerbated the pricing situation while creating an artificial supply-shortage of short/medium shaped grain.  The Chinese government has regulated grain supplies and prices in the past by opening up state-owned reserves for bidding to qualified private enterprises, and did so in 2010.  As a qualified private enterprise, we participated in such biddings as we believe that the prices that we would pay through bidding would still be lower than market prices, and sourced approximately 44.0% of our total grain purchases in 2010 from state-owned reserves.  Of this amount, 92.4% was short/medium-shaped grains from state-owned reserves in Liaoning (where Panjin is located), Heilongjiang and Jilin, and the remaining 7.6% was long-shaped grains from state-owned reserves in Jiangxi.  In addition, we are looking to further reduce our reliance on Panjin, and have accordingly contracted with one private supplier in Heilongjiang and two private suppliers in Jilin to supply short/medium-shaped rice grains for 2011.  While short/medium-shaped rice grains from Heilongjiang and Jilin may be less renowned than those from Panjin, we believe that their quality is on par and that the quality of our products has not been, and will not be, compromised.  At the same time, we will continue to look to Panjin as an important supply source, and based on harvest results for the end of 2010, we believe that pricing should be stabilizing at least during the first half of 2011 from favorable crop yields at the end of 2010 that should somewhat alleviate the tight supply issue.  As such, we are optimistic about our ability to continue to meet our grain requirements in the near future.  At the same time, if we lose any of these significant sources of rice grains for any reason, our results of operations and profitability may be adversely affected.

· Our ability to maintain and consolidate our market share in, and expand beyond, Fujian

Our ability to consolidate the market in Fujian and penetrate into regions beyond Fujian directly influences our financial condition and results of operations.  Despite being one of Fujian’s largest rice processing company, we estimate that we currently have less than 3% of the province’s market.  As such, we believe that gaining market share in Fujian will be crucial not only to our growth in the near term but to our plans to expand beyond the province.  To that end, we intend to continue our branding efforts (such as our “China Top Brand” and “China Famous Trade Mark” designations) and advertising activities to increase market visibility and attract non-distributor customers such as supermarkets and other retailers.  If we are unable to obtain incremental market share despite our efforts, however, our results of operations and financial performance may be affected.

· Our ability to successfully launch our refined rice bran oil product

If formal production of refined rice bran oil can commence under our current planning, we would be in position to market and sell the product around the same time through both existing distributors as well as directly to supermarkets and other retailers.  Based on internal research, we believe that demand for refined rice bran oil should continue to exceed supply when we formally enter the market as currently expected.  Furthermore, while we will initially use internally produced rice bran, we believe that rice bran should continue to be readily available and its price relatively stable if we need to supplement our supply.  Such expectations and beliefs, however, are based on our estimation of when we can complete the application process for, and obtain the Production License, the timing and result of which is not within our control.  As the market for refined rice bran oil is still relatively undeveloped, however, market reception to and demand for the product may significantly differ from our expectation, and may change by the time we can formally launch our product, if at all, which in turn will affect our future prospects.

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Results of Operations

Comparison of the Years Ended December 31, 2010, 2009 and 2008

	Year Ended December 31,
	2008					2009					2010
	(1)		(2)			(1)			(2)			(1)		(2)
Revenues	$	36,007		100.0	%	$	60,533		100.0	%	$	82,189		100.0	%
Gross Profit		6,560		18.2			13,845		22.9			17,558		21.4
Operating Expenses		821		2.3			1,080		1.8			2,796		2.8
Government Subsidies		147		0.4			126		0.2			81		0.1
Income From Operations		5,886		16.3			12,891		21.3			14,843		18.6
Other Expenses, net		942		2.6			847		1.4			769		0.9
Income Tax Expense (Benefit)		3		0.0			(27	)	(0.0	)		(21	)	(0.0	)
Net Income	$	4,941		13.7	%	$	12,071		19.9	%	$	14,095		17.7	%

(1)  Amounts in thousands U.S. dollars.

(2)  Percentage of revenues.

Revenues

Revenues increased by $21,656 thousand, or 35.8%, to $82,189 thousand for the year ended December 31, 2010 from $60,533 thousand for the year ended December 31, 2009, on increased sales to existing customers.  Sales of long-grain rice increased by 192.1% as compared to the same period of 2009 from increased sales volume of 11,330 mt to 27,328 mt as brewers increased their purchase orders to meet market demands for their beer, as well as increased unit sale price from $387 to $468.  Sales of short/medium-grain rice were also positive, as our continuing marketing activities translated into a 29.8% increase year-over-year, with increased sales volume from 74,480 mt to 94,302 mt, and increased unit sale price from $582 to $596.  On the other hand, our nutrient-fortified rice sales decreased by 6.3% as compared to the same period of 2009, due to increasing competition in this higher-end niche category.

Revenues increased by $24,526 thousand, or 68.1%, to $60,533 thousand for the year ended December 31, 2009 from $36,007 thousand for the year ended December 31, 2008.  Sales of long-grain rice to beer brewers increased by 121.2% as compared to the same period of 2009 from increased sales volume of 4,720 mt to 11,330 mt, boosted in part by decreased unit sale price from $420 to $387.  Market expansion of our nutrient-fortified rice saw sales increased by 342.7% as compared to the same period of 2009 from increased sales volume of 1,869 mt to 7,753mt, despite increased unit sale price from $1,145 to $1,222.  Sales of short/medium-grain rice year-over-year also increased by 46% despite higher unit sale price, from $535 to $582.

A breakdown of our revenues and cost of revenues for these periods, and their changes period-over-period, by product, are as follows (amounts in thousands except percentages):

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	Year ended December 31,										Increase (decrease) in revenues and % of						Increase (decrease) in cost of revenues and %
	2009					2010					increase (decrease)						of increase (decrease)
	Revenues			Cost of  revenues		Revenues			Cost of revenues		Increase			Increase %			Increase		Increase %
Short/medium-grain rice		43,328			35,562		56,231			46,862		12,903			29.8	%		11,300		31.8	%
Nutrient-fortified rice		9,474			4,256		8,878			4,349		(596	)		(6.3	)%		93		2.2	%
Long-grain rice		4,381			3,762		12,796			9,651		8,415			192.1	%		5,889		156.5	%
Rice milling byproducts		3,775			3,108		4,772			3,769		997			26.4	%		662		21.3	%
Sales tax		(425	)		0		(488	)		0		(63	)		14.8	%		0		0.0	%
Total		60,533			46,688		82,189			64,631		21,656			35.8	%		17,944		38.4	%

	Year ended December 31,										Increase (decrease) in revenues and % of					Increase (decrease) in cost of revenues and % of increase
	2008					2009					increase (decrease)					(decrease)
	Revenues			Cost of revenues		Revenues			Cost of revenues		Increase		Increase %			Increase		Increase %
Short/medium-grain rice		29,682			24,605		43,328			35,562		13,646		46.0	%		10,957		44.5	%
Nutrient-fortified rice		2,140			921		9,474			4,256		7,334		342.7	%		3,335		362.1	%
Long-grain rice		1,980			1,716		4,381			3,762		2,400		121.2	%		2,046		119.2	%
Rice milling byproducts		2,707			2,205		3,775			3,108		1,069		39.5	%		903		41.0	%
Sales tax		(502	)		0		(425	)		0		77		(15.3	)%		0		0.0	%
Total		36,007			29,447		60,533			46,688		24,526		68.1	%		17,241		58.5	%

Cost of Revenues

Our cost of revenues for the year ended December 31, 2010 increased by $17,943 thousand, or 38.4%, to $64,631 thousand from $46,688 thousand for the year ended December 31, 2009. The increase was primarily due to the cost associated with our short/medium-grain rice, which increased 31.8% compared with the year ended December 31, 2009.

Our cost of revenues for the year ended December 31, 2009 increased by $17,241 thousand, or 58.5%, to $46,688 thousand from $29,447 thousand for the year ended December 31, 2008.  The increase was primarily due to the cost associated with our nutrient-fortified rice, which increased 362.1% compared with the year ended December 31, 2008.

Gross Profit and Gross Margin

As a result of our total sales growth, gross profit for the year ended December 31, 2010 increased by $3,713 thousand, or 26.8%, to $17,558 thousand from $13,845 thousand for the year ended December 31, 2009.  Gross margin, however, decreased by 1.5% year-over-year, from 22.9% to 21.4%, largely due to the decreased sales volume of nutrition-fortified rice, which has historically been our highest gross margin product.  However, impacted by higher cost of short/medium grains in 2010, gross margin for nutrition-fortified rice also decreased, from 55.1% to 51.0%.

Our total sales growth for the year ended December 31, 2009 also resulted in gross profit increase of $7,285 thousand, or 111.1%, to $13,845 thousand from $6,560 thousand for the year ended December 31, 2008.  Gross margin also increased by 4.7% year-over-year, from 18.2% to 22.9%, largely due to the sales growth of our nutrient-fortified rice.  Our gross margin for this product for the year ended December 31, 2009 was 55.1%.

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Selling Expenses

Selling expenses for the year ended December 31, 2010 increased by $343 thousand, or 84.9 %, to $747 thousand from $404 thousand for the year ended December 31, 2008.  The increase was primarily due to increased transportation expenses as the result of our sales growth as well as increased travelling and advertising expenses incurred in connection with our marketing as compared with last year in order to increase our sales.  In addition to our regular visits with existing distributor and non-distributor customers to maintain our relationships and discuss their purchases, we sought out and visited potential customers to introduce our brand and products.  To increase our visibility and brand awareness, we also exhibited our products at regional and national trade fairs, as well as increased our television commercials and print advertisement such as on billboards and in elevators.

Selling expenses for the year ended December 31, 2009 increased by $61 thousand, or 17.8 %, to $404 thousand from $343 thousand for the year ended December 31, 2008.  The increase was primarily due to increased transportation expenses as the result of our sales growth.

General and Administrative Expenses

General and administrative expenses for the year ended December 31, 2010 increased by $1,373 thousand, or 203.1%, to $2,049 thousand from $676 thousand for the year ended December 31, 2009.  The increase was primarily due to the increased lease expenses of $67 thousand for our second production facility, increased employee benefits of $45 thousand as well as increased legal and other professional fees of $631 thousand and increased accounting fees of $470 thousand in connection with this offering.

General and administrative expenses for the year ended December 31, 2009 increased by $198 thousand, or 41.4%, to $676 thousand from $478 thousand for the year ended December 31, 2008.  The increase was primarily due to $74 thousand of increased bank loan processing and due diligence fees and increased tax expenses of $27 thousand for the land and building that our headquarters and a production facility occupy and are housed in. We also incurred $39 thousand in lease expense for our second production facility set up during 2009.

Income Tax Benefit/Expense

We recorded $21 thousand income tax benefit in the year ended December 31, 2010, compared to income tax benefit of $27 thousand in the year ended December 31, 2009.  The decrease in tax benefit was mainly due to the deferred tax asset setup against the temporary difference arisen from government subsidies, depreciation charge and accrued lease expenses amounting to $70 thousand for the year ended December 31, 2010.

We recorded $27 thousand income tax benefit in the year ended December 31, 2009, compared to income tax expense of $3 thousand in the year ended December 31, 2008.  The decrease in tax expense was mainly due to the deferred tax asset setup against the temporary difference arisen from government subsidies and accrued lease expenses amounting to $39 thousand for the year ended December 31, 2009.

Net Income

As a result of all over-all growth sales from year to year, net income increased from $4,941 thousand for the year ended December 31, 2008 to $12,071 thousand for the year ended December 31, 2009, a 144.3% increase, and to $14,095 thousand for the year ended December 31, 2010, a 16.8% increase from 2009.

Liquidity and Capital Resources

We have financed our operations primarily through cash flows from equity contributions and cash flows from operations.  As of December 31, 2008, 2009 and 2010, we had $328 thousand, $3,727 thousand and $7,063 thousand, respectively, in cash and cash equivalents. We believe that our current cash, together with the proceeds from this offering as well as cash flows from operations will be sufficient to meet our anticipated cash needs for the next twelve months. We may, however, require additional cash resources due to changed business conditions or other future developments, including any investments or acquisitions we may decide to pursue.

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Cash Flows

The following table summarizes our cash flows for the periods indicated (amounts in thousands):

	Years Ended December 31,
	2008			2009			2010
Net cash (used in) provided by operating activities		(1,425	)		884			14,795
Net cash provided by (used in) investing activities		438			(628	)		(2,926	)
Net cash provided by (used in) financing activities		1,010			3,142			(8,932	)

Net Cash (Used In) Provided By Operating Activities

We used $1,425 thousand in operating activities for 2008, and had $884 thousand and $14,795 thousand from operating activities for 2009 and 2010, respectively.  The net cash used in 2008 resulted from the increase in inventory of $1,833 thousand and amounts due from related parties of $7,053 thousand, offset by net income of $4,941 thousand and increased bills payable of $2,883 thousand.  The increase of net cash provided by operating activities from 2008 to 2009 resulted from the 2009 net income of $12,071 thousand and a decrease of $6,596 thousand in amounts due from related parties, offset by increased inventories of $10,162 thousand, increased accounts receivable of $3,726 thousand and increased advances for inventory purchases of $2,562 thousand.  The increase of net cash provided by operating activities from 2009 to 2010 resulted from the 2010 net income of $14,095 thousand, decreased inventories of $8,534 thousand and a decrease of $4,436 thousand in amounts due from related parties, offset by increased accounts receivable of $1,779 thousand and increased advances for inventory purchases of $13,275 thousand.

Net Cash Provided by (Used In) Investing Activities

Net cash used in investing activities largely reflects capital expenditures, which principally consists of purchases of property, plant and equipment made in connection with the expansion of our business operations.  We also loaned money to certain unrelated third parties and related parties to facilitate their cash flow needs, although we have reduced such practice since July 2010.  $438 thousand was provided by investing activities for 2008, primarily from $6,576 thousand in returns on loans to unrelated third parties, including the $6,136 thousand loaned out during the period.  In 2009, $628 thousand was used in investing activities, resulting from $312 thousand for production equipment and $6,579 thousand in loans to unrelated third parties from which we received $7,377 thousands in return, as well as $3,250 thousand in loans to a related party of which $2,136 thousand was repaid during the period.  In 2010, $2,926 was used in investing activities, resulting from $4,280 thousand for purchase of fixed assets and $1,108 thousand in loans to unrelated third parties from which we received $1,338 thousands in return, as well as $4,518 thousand in loans to a related party who repaid $5,642 thousand during the period.

Net Cash Provided By (Used In) Financing Activities

We had $1,010 thousand and $3,142 thousand from financing activities for 2008 and 2009, respectively, but used $8,932 thousand in 2010.  Our financing activities principally consisted of loans from banks, although we also borrowed money from certain unrelated third parties as well as related parties on occasions to facilitate our short-term cash flow requirements.  We typically repay such loans within three months, and we have minimized such borrowings since July 2010.

During 2008 we received aggregate bank loan proceeds of $18,740 thousand and repaid $17,730 thousand of bank loans.  We also borrowed $11,901 thousand from unrelated third parties which were repaid in full.  During 2009 we received aggregate short-term bank loan proceeds of $19,778 thousand, and repaid $16,860 thousand of such loans.  We also received aggregate long-term bank loan proceeds of $224 thousand.  We borrowed $4,043 thousand from unrelated third parties which were repaid in full, and borrowed $6,459 thousand from a related party which was also repaid in full.  During 2010, we issued 50,000 ordinary shares for total consideration of $50 thousand.  We received aggregate short-term bank loan proceeds of $32,088 thousand, and repaid $31,070 thousand of such loans.  We also borrowed $1,041 thousand from unrelated third parties which were repaid in full, and borrowed $16,445 thousand from related parties which was also repaid in full.  During 2010, Grand Farm China also distributed $10,000 thousand in the aggregate as dividend to its two equity owners, Mr. Yao and Mr. Jianxin Yao.

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As December 31, 2008, 2009 and 2010, we had approximately $11,736 thousand, $14,655 thousand and $16,199 thousand of outstanding short-term bank borrowings, respectively, bearing weighted average interest rates at 8.10%, 5.77% and 5.56 % per annum respectively.

Our short-term borrowings mature at various dates within one year.  These facilities contain no specific renewal terms or any requirement for the maintenance of financial covenants.  We have been able to pay off the loans on their due dates and borrow again from the same banks.  As we expanded our business, our borrowing capacity also increased over the years.  This type of financing is very similar to a revolving line of credit and is common practice in China, particularly in Fujian Province where we are headquartered and our production facilities are located.  Amounts outstanding under these bank loans are presented in our financial statements as short-term loans.

Seasonality

Because rice grain is our principal raw materials, we are subject to seasonal grain price fluctuation largely dictated by changing crop yields.  We normally purchase short/medium-shaped grain from October to June, the harvest season for this type of grain, and from state-owned grain reserve centers from June to October.  For our long-shaped grain needs, we tend to make our purchases throughout the year.  As necessary, we may also purchase long-shaped grain from Jiangxi and Fujian throughout the year to supplement our supply.  Historically, prices tend to be higher during the harvest seasons when fresh grain comes into the market.  To minimize the impact of price fluctuation and to ensure sufficient raw materials for our needs, we would advance payments to our suppliers, and we also have the ability to store up to approximately 40,000 mt of grain as reserves.  As such, seasonal pricing fluctuations of rice grain have had minimal impact on our operations historically.  Such fluctuations were also less evident from 2008 to 2010, as grain prices rose steadily throughout these years in light of inflation and/or market-driven supply shortage.

As rice is a staple food item in China, seasonality generally has little or no impact on the sales of our rice products.

Capital Expenditure

Capital expenditures principally consist of purchases of property, plant and equipment made in connection with the expansion of our business operations.  For 2008, capital expenditures principally consist of $2 thousand for office equipment.  For 2009, capital expenditures principally consist of $312 thousand for production equipment.  For 2010, capital expenditures principally consist of $629 thousand for motor vehicles, $93 thousand for office equipment, and $3,558 thousand for production equipment.

We expect our capital expenditures to increase in the future as we expand our business to implement our growth strategy.  For 2011, we anticipate to fund capital expenditures primarily from the proceeds of this offering to upgrade our existing production lines and to increase our rice production capacity.

Quantitative and Qualitative Disclosures about Market Risk

Foreign Exchange Risk

Substantially all of our operating revenues and expenses are denominated in RMB, which are translated into the U.S. dollar as our functional and reporting currency for our financial statements.  The value of the RMB against the U.S. dollar and other currencies may fluctuate and is affected by, among other things, changes in China’s political and economic conditions.  The conversion of RMB into foreign currencies, including U.S. dollars, has been based on rates set by the People’s Bank of China.  On July 21, 2005, the PRC government changed its decade-old policy of pegging the value of the RMB to the U.S. dollar.  Under the new policy, the RMB is permitted to fluctuate within a narrow and managed band against a basket of certain foreign currencies.  This change in policy has resulted in an approximately 18.7% appreciation of the RMB against the U.S. dollar from July 21, 2005 to December 31, 2009.  Significant international pressure on the PRC government to adopt an even more flexible currency policy could result in a further and more significant appreciation of the RMB against the U.S. dollar.

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Our exposure to foreign exchange risk relates primarily to cash and cash equivalents denominated in U.S. dollars.  We do not believe that we currently have any significant direct foreign exchange risk and have not hedged exposures denominated in foreign currencies or any other derivative financial instruments.  Because we generally receive cash flows denominated in RMB, our exposure to foreign exchange risks should be limited.  However, the value of our ADSs will be affected by the foreign exchange rate between U.S. dollars and RMB because our ADSs are traded in U.S. dollars and any dividend payments we may pay in the future will be made in U.S. dollars.  If the value of the RMB was to increase after the closing of this offering but before we invested the proceeds in assets denominated in RMB or to pay RMB-denominated expenses, the value of those U.S. dollar-denominated proceeds would be proportionally less.  Fluctuation in the exchange rate between the RMB and U.S. dollar would therefore impact the RMB proceeds to us from this offering. Assuming an offering price of $, our U.S. dollar gross proceeds from this offering would be $, or RMB using the U.S. dollar/RMB exchange rate at December 31, 2010.  If the RMB were to appreciate by 1.0% against the U.S. dollar over the December 31, 2010 exchange rate, the amount of our RMB proceeds from this offering would decrease by RMB .

To the extent that we need to convert U.S. dollars into RMB for operations, appreciation of the RMB against the U.S. dollar would have an adverse effect on the RMB amount it received from the conversion.  Conversely, if we decide to convert RMB denominated cash amounts into U.S. dollars for the purpose of making dividend payments or for other business purposes, appreciation of the U.S. dollar against the RMB would have a negative effect on the U.S. dollar amount available to us.  We have not used, and do not expect to use in the future, any forward contracts or currency borrowings to hedge exposure to foreign currency exchange risk.

Interest Rate Risk

We have not been, nor do we anticipate being, exposed to material risks due to changes in interest rates.

Inflation

According to the PRC National Bureau of Statistics, China’s Consumer Price Index (CPI) for 2008, 2009 and 2010 were 105.9, 99.3 and 103.3, respectively.  While inflationary changes during these periods did not have a significant material impact on our results of operations, continuing inflationary pressure in the current economic environment may impact our future operations and financial performance.

Credit Risk

Since commencing our operations in May 2001, we have not written off bad debts.  In addition, we generally have short accounts receivable cycles and short collection periods, as we generally give credit terms of 30 to 60 days from delivery and all accounts receivables are then normally collected within two months.  We do not have any outstanding accounts receivable.  Except for one customer who accounted for 12% of our total sales in 2010, no other customers individually accounted for 10% or more of our total sales in 2010, 2009 or 2008.  As a result, we believe we have no significant exposure to credit risk.

Off-Balance Sheet Arrangements

We have not entered into any other financial guarantees or other commitments to guarantee the payment obligations of any third parties.  We have not entered into any derivative contracts that are indexed to our shares and classified as shareholder’s equity or that are not reflected in our financial statements.  Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity.  We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us.

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Contractual Obligations

Below is a summary of our contractual obligations as of December 31, 2010 (amounts in thousands):

			Payments due by Period
Contractual Obligations	Total		Less than 1 year		1-3years		3-5 years		More than 5 years
Operating lease obligations	$	2,134	$	76	$	251	$	291	$	1,516
Capital commitment	$	141	$	141	$	-	$	-	$	-
Bank borrowings:
Principal	$	16,431	$	16,199	$	232	$	-	$	-
Interest	$	803	$	801	$	2	$	-	$	-
Total:	$	19,509	$	17,217	$	485	$	291	$	1,516

Rental expenses under operating leases for the years ended December 31, 2008, 2009 and 2010 were $Nil, $40 thousand and $107 thousand, respectively.  The significantly higher amount for 2010 reflects the amortization of the 8-year lease extension for our second production facility and the 5% rent increase for such extended term.

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OUR CORPORATE HISTORY AND STRUCTURE

Corporate History

Grand Farm Cayman is an exempted limited liability company established under the laws of the Cayman Islands on June 30, 2010.  85% of the issued and outstanding equity interests of Grand Farm Cayman are held by Sunlight Blaze, a company limited by shares established under the laws of the British Virgin Islands on April 9, 2010. Our chairman, Mr. Jianshan Yao, and his brother, Mr. Jianxin Yao, hold 99.75% and 0.25% of the outstanding shares of Sunlight Blaze, respectively.  Other than holding 100% of the outstanding equity interests of Grand Farm HK, Grand Farm Cayman has no separate operations of its own.

Grand Farm HK is a limited liability company established under the laws of Hong Kong Special Administration Region on June 29, 2010.  Other than holding 100% of the outstanding equity interests of Grand Farm WFOE, Grand Farm HK has no separate operations of its own.

Grand Farm WFOE is a limited liability company organized in the PRC on September 19, 2010, with registered capital of $500,000, which has been fully paid as of the date of this prospectus.  Because all of the outstanding equity interests are held by Grand Farm HK, Grand Farm WFOE is deemed a wholly foreign owned enterprise, or WFOE, under applicable PRC law.  The principal purpose of Grand Farm WFOE is to manage, hold and own rights in and to the businesses, operations and profits of Grand Farm China, which it does through a series of agreements with Grand Farm China and its owners.

Grand Farm China is a limited liability company organized in the PRC on May 31, 2001, with registered capital of RMB 40,000,000 ($5,017,000).  Grand Farm China is owned by two Chinese citizens, namely our chairman, Jianshan Yao, who owns a 99.75% equity interest, and his brother Jianxin Yao, who owns the remaining 0.25%.  All of our business operations are conducted by Grand Farm China, which has the necessary licenses, permits and approvals, except the Production License for our refined rice bran oil production line which we expect to receive by the end of May 2011.

On September 25, 2010, Grand Farm WFOE entered into a series of agreements with Grand Farm China and its two owners, pursuant to which Grand Farm WFOE agreed to provide research and development services and business operation services to Grand Farm China.  Through these contractual arrangements, Grand Farm WFOE also has the ability to effectively control Grand Farm China’s daily operations and financial affairs, appoint senior executives and decide on all matters subject to shareholders’ approval.  As a result of these contractual arrangements, Grand Farm Cayman, the ultimate parent company of Grand Farm WFOE, is considered to be the primary beneficiary of Grand Farm China and Grand Farm China a variable interest entity, or VIE, of Grand Farm Cayman under US GAAP.  Accordingly, Grand Farm Cayman consolidates Grand Farm China’s financial results, assets and liabilities in its financial statements.  Since both Grand Farm Cayman and Grand Farm China are under common control, Grand Farm Cayman’s financial statements will reflect this reorganization as a transaction under common control and will be prepared as if the reorganized corporate structure had been in existence throughout all the periods presented.  If Grand Farm China and/or its equity owners breach the contractual arrangements with us, Grand Farm Cayman may not be able to continue to effectively control Grand Farm China’s operations and to remain its primary beneficiary.  In such case, Grand Farm Cayman would have to rely on legal remedies under PRC law, which may not always be effective, particularly in light of uncertainties in the PRC legal system.  See “Risk Factors — Risks Related to Doing Business in China — Uncertainties with respect to the PRC legal system could adversely affect us.”

On December 30, 2010, Grand Farm WFOE entered into an agreement with Grand Farm China and its two owners, pursuant to which Grand Farm WFOE authorized Grand Farm China to declare RMB 66,200,000 ($10,000,000), or 52% of its unappropriated earnings from its inception to December 31, 2009, as dividend for distribution to its two owners pro rata to their respective ownership interests.  Grand Farm China may not, however, declare or distribute the remaining 48% of its unappropriated earnings or its unappropriated earnings for 2010 and beyond.

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Contractual Arrangements with Grand Farm China and its Equity Owners

Our relationship with Grand Farm China and its equity owners are governed by the series of contractual arrangements that they have entered into with Grand Farm WFOE.  Although we do not believe that current PRC regulations restrict or prohibit foreign investment in domestic companies engaging in grain processing business such as Grand Farm China, there is substantial uncertainty regarding the interpretation and application of such regulations.  To address such uncertainty, we have elected to control Grand Farm China and its operations through contractual arrangements, thereby avoiding the applicability of those PRC regulations governing foreign investments in domestic enterprises.  At the same time, we have the right to acquire Grand Farm China’s equity interests under the exclusive equity interest purchase agreement (as described below) at a later time when the current uncertainty of the PRC regulations is removed.

Under PRC law, each of Grand Farm WFOE and Grand Farm China is an independent legal person and neither of them is exposed to liabilities incurred by the other party.  Other than pursuant to the contractual arrangements between Grand Farm WFOE and Grand Farm China, Grand Farm China does not transfer any other funds generated from its operations to Grand Farm WFOE.  Grand Farm WFOE’s relationships with Grand Farm China and its equity owners are governed by the following contractual arrangements entered into on September 25, 2010:

Exclusive Technical Consulting Service Agreement

Under the consulting service agreement executed between Grand Farm WFOE and Grand Farm China, Grand Farm WFOE has the exclusive right to provide Grand Farm China with management consulting services relating to Grand Farm China’s business operations in exchange for yearly service fees equal to 85% of Grand Farm China’s annual net profit, payable on a semi-annual basis.  If Grand Farm China fails to pay Grand Farm WFOE its fees pursuant to this agreement, then interest shall accrue on any amounts owed by Grand Farm China to Grand Farm WFOE at a compound annual rate of 1% until such payment is made in full.  This agreement is effective until September 24, 2060, provided that Grand Farm WFOE may terminate the agreement before such time upon a 30-day written notice to Grand Farm China.  Grand Farm China, however, may not terminate the agreement except for gross negligence, bankruptcy, fraud or illegal action of Grand Farm WFOE.  Grand Farm WFOE has the sole discretion to renew the agreement for additional terms of 50 years following the termination date.

Operating Agreement

Under the operating agreement among Grand Farm WFOE, Grand Farm China and the two shareholders of Grand Farm China, Grand Farm WFOE has agreed to serve, at its discretion, as Grand Farm China’s guarantor in any contracts, agreements or transactions relating to Grand Farm China’s business.  In consideration, Grand Farm China and its shareholders have agreed to accept guidance and advice from Grand Farm WFOE on Grand Farm China’s daily operations and financial management systems.  In addition, the shareholders of Grand Farm China must elect the candidates recommended by Grand Farm WFOE as Grand Farm China’s directors, and appoint Grand Farm WFOE’s senior managers to Grand Farm China’s senior management positions.  Moreover, Grand Farm China and its shareholders agree that without the prior consent of Grand Farm WFOE, Grand Farm China will not engage in any transactions that could materially affect the assets, obligations, rights or operations Grand Farm China (except in the ordinary course of business), including incurrence or assumption of any indebtedness, sale or purchase of any assets or rights (including intellectual property rights), incurrence of any encumbrance on any of its assets or intellectual property rights in favor of a third party, or assigning its business agreements to a third party.

This agreement is effective until September 24, 2060, provided that Grand Farm WFOE may terminate the agreement before such time upon a 30-day written notice to Grand Farm China.  Grand Farm China, however, may not terminate the agreement. Grand Farm WFOE has the sole discretion to renew the agreement for additional terms of 50 years.

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Exclusive Equity Interest Purchase Agreement

Under the exclusive equity interest purchase agreement among Grand Farm China, its shareholders and Grand Farm WFOE, the shareholders of Grand Farm China have irrevocably granted Grand Farm WFOE or its designee an exclusive purchase option to acquire, at any time, the entire portion of Grand Farm China’s equity interest held by each shareholder of Grand Farm China, or any portion thereof, to the extent permitted by PRC law.  The purchase price for the shareholders’ equity interests in Grand Farm China shall be the lowest price permitted by PRC law.  Grand Farm WFOE or its designee has sole discretion to decide when to exercise the option.  If Grand Farm WFOE (or any eligible party designated by Grand Farm WFOE) elects to purchase a portion of the share equity of Grand Farm China, the exercise price for such partial exercise of the option shall be a pro rata portion of the total purchase price.

During the term of this agreement, Grand Farm China agree that it shall not, without obtaining prior written consent of Grand Farm WFOE, (1) supplement, amend, or modify any provisions of its charter and organizational documents and will not increase or reduce its registered capital or change the equity holding structures in any other way; (2) sell, transfer, mortgage or dispose of any of its assets, business or beneficial rights, or allow any creation of another security interest or other encumbrance upon its assets; (3) incur, inherit, or guarantee any debts except for (i) debt incurred during the course of normal business operations (excluding business loans); and (ii) the debt that has been previously disclosed to Grand Farm WFOE to which Grand Farm WFOE has provided prior written consent; (4) enter into any material agreement for an amount in excess of RMB 100,000 except in the normal course of business; (5) merge with, combine with, make investment in, purchase the equity or substantially all the assets of any other entity; or (6) allot any dividend to any shareholder.

The shareholders of Grand Farm China further agree that they shall not, without obtaining prior written consent of Grand Farm WFOE, sell, transfer, mortgage or dispose of any rights or interest relating to their equity interests in Grand Farm China, or allow any creation of other security interests or encumbrances on such equity interests (except pursuant to the equity interest pledge agreement as described in more details below).

This agreement is effective until September 24, 2060.  During such time, Grand Farm WFOE or its designee may exercise the option under the agreement when the attendant administrative procedures as may be imposed by current regulations are clearer and less burdensome.  Specifically, under the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors that went into effect on September 8, 2006, or the New M&A Rules, it remains unclear whether the contractual arrangements with Grand Farm China require the approval of the Ministry of Commerce, or MOFCOM.  See “Risk Factors – Risks Relating to Our Structure - The approval of the Ministry of Commerce may be required in connection with the establishment of our contractual arrangements with Grand Farm China. Our failure to obtain this approval, if required, could have a material adverse effect on our business, operating results, reputation and trading price of our ADSs.”   Thus, an exercise of the option by Grand Farm WFOE or its designee may subject the transaction to the New M&A Rules and the attendant examination and approval of the MOFCOM, which could be prohibitively time-consuming and complex.  Grand Farm WFOE also has the sole discretion to renew the agreement for additional terms of 50 years.

Equity Interest Pledge Agreement

Under the equity interest pledge agreement among the shareholders of Grand Farm China and Grand Farm WFOE, the shareholders of Grand Farm China pledged all of their equity interests in Grand Farm China to Grand Farm WFOE to guarantee Grand Farm China’s performance of its obligations under the exclusive technical consulting service agreement.  Also, Grand Farm WFOE is entitled to collect 15% of Grand Farm China’s total annual net profits under the equity interest pledge agreement.  Pursuant to the terms of this agreement, in the event that either Grand Farm China or its equity owners is in breach of either the exclusive technical consulting service agreement or the operating agreement, then Grand Farm WFOE shall be entitled to require the shareholders of Grand Farm China to transfer their equity interests in Grand Farm China to it.  This agreement shall remain in effect so long as the exclusive technical consulting service agreement is in effect.  On December 3, 2010, the registration with the Administration of Industry and Commerce’s Putian office, or Putian AIC, for the pledged equity interests of the two owners of Grand Farm, our chairman Mr. Jianshan Yao and Mr. Jianxin Yao, was completed.

Power of Attorney

Each shareholder of Grand Farm China has executed an irrevocable power of attorney to appoint the authorized personnel of Grand Farm WFOE as its attorney-in-fact to exercise all of its rights as equity owner of Grand Farm China, including (1) the right to sell, assign, transfer or pledge any or all of the equity interests held by the shareholders of Grand Farm China; and (2) the voting rights at shareholders’ meetings.  The Power of Attorney will remain in effect so long as the shareholder remains a shareholder of Grand Farm China.

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However, there are substantial uncertainties regarding the interpretation and application of current and future PRC laws, regulations and rules.  If the PRC government finds that the foregoing agreements that establish the structure for operating our PRC business do not comply with applicable PRC regulations, we could be subject to severe penalties including being prohibited from continuing operations.  See “Risk Factors — Risks Related to Our Corporate Structure — Grand Farm WFOE’s contractual arrangements with Grand Farm China and its shareholders may not be as effective in providing control over Grand Farm China as direct ownership of Grand Farm China, and the shareholders of Grand Farm China may have potential conflicts of interest with us.” and “Risk Factors — Risks Related to Doing Business in China — Uncertainties with respect to the PRC legal system could adversely affect us.”

Corporate Structure

The chart below illustrates our corporate structure as of the date of this prospectus.

(1) Includes 3% held by Chaotang Li, our strategic development director and a member of our board of directors, through an entity that he owns and controls.

Please see the section entitled “Risk Factors — Risks Relating to Our Structure.”

The chart below illustrates our corporate structure immediately after the closing of this offering, assuming all ADSs offered in the offering are sold.

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(1) Includes      % held by Chaotang Li, our strategic development director and a member of our board of directors, through an entity that he owns and controls.

(2) Each ADS represents       of our ordinary shares, par value $0.002 per share.

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OUR BUSINESS

Business Overview

Grand Farm is a leading rice producer in China.  Established in June 2001, we are headquartered in Putian, Fujian Province in southeastern China.  All of our business operations are conducted by Grand Farm China, which we control through a series of contractual arrangements between Grand Farm WFOE, our wholly-owned subsidiary, and Grand Farm China and its owners.

We currently produce three types of milled rice that we prepackage and sell under the “Grand Farm” brand to our distributors for wholesale and retail distributions throughout Fujian.  We produce regular milled rice and nutrient-fortified rice from short/medium-shaped grain primarily sourced from northeastern China – Panjin in Liaoning Province, Bayan in Heilongjiang Province and Jilin City and Dehui in Jilin Province.  To cater to consumers who may prefer a different taste and texture than rice made from short/medium-shaped grain, and to diversify our product offerings, we also produce regular milled rice from long-shaped rice grain sourced from Jiangxi Province and Fujian Province in southern China.  All three types of prepackaged milled rice products are consumed by the Chinese consumers as daily staples.  In addition to prepackaged rice, we also produce milled rice from long-shaped rice grains also sourced from Fujian and Jiangxi that we sell in bulk directly to brewers throughout Fujian to make beer.  Byproducts from our rice milling process, such as rice bran and broken rice, are sold in bulk directly to livestock feed factories and stores.  Our net income for the years ended December 31, 2008, 2009 and 2010 was approximately $4.9 million, $12.1 million and $14.1 million, respectively.

We currently have two production facilities both in Putian.  The first facility is located at our headquarters and has two processing lines with combined annual rice grain processing capacity of 260,000 mt, yielding 180,000 mt of milled rice, as well as our proprietary production line for nutrient-fortified rice with annual production capacity of 80,000 mt.  Our entire production process at this facility, from sourcing raw materials to production to sales, is ISO9001:2000 certified (for quality control), HACCP certified (for food safety control), and ISO14001:2004 certified (for environment control).  The second facility, in proximity to our headquarters, houses an integrated rice bran oil production line with 24,000 mt in annual production capacity.  Oil will initially be produced from the rice bran that we currently sell for livestock feed.  We commenced trial production of unfinished, or crude, rice bran oil, in October 2010 and expect formal production of refined rice bran oil to commence immediately after obtaining a Production License anticipated by the end of May 2011.

The second facility will also house another rice production line with projected annual rice grain processing capacity of 90,000 mt, yielding approximately 60,000 mt of milled rice.  Because the building that this production line will occupy requires modifications to accommodate our equipment, we are in the process of registering the plan for the modifications with the Putian Development and Reform Commission, and allowing the Putian Environmental Protection Bureau complete an environmental impact study in connection with such modifications.  We currently expect to complete these steps in May 2011, the modifications to the building in September 2011 and the installation of the production line by the end of 2011, and to commence formal production immediately thereafter.

Industry Background

China’s Rice Industry

World rice grain output has grown steadily over the past five years. According to the statistics from the U.N. Food and Agriculture Organization, or FAO, global rice grain output reached 689 million mt, equivalent to 460 million mt of milled rice, in 2009.  Asia accounts for over 90% of the total global rice grain output – reaching 623 million mt. in 2009 – and is also the largest rice consumption region.  Of that amount, China accounted for 195 million mt, according to The China National Grain and Oils Information Center, or CNGOIC and the National Bureau of Statistics of China, or NBS, up from 192 million mt in 2008 and 186 million mt in 2007, making it the world’s largest rice grain producer.  With over 60% of its population relying on rice as their staple food source according to FAO, China is also the world’s largest rice consumer, reaching 182 million mt, equivalent to 127 million mt of milled rice, in 2009, as reported by CNGOIC.

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Rice Grain Output (in million mt):

	2005		2006		2007		2008		2009
Global Output		633.0		642.6		660.5		687.5		689.3
Asia Output		572.3		581.9		601.2		622.6		622.5
China Output		180.6		181.7		184.0		191.9		195.1

Source: FAO, CNGOIC

Rice grain can be categorized according to its shape as short/medium-shaped grain and long-shaped grain. According to CNGOIC estimation, China produced 55.5 million mt of short/medium-shaped rice grains and 139.6 million mt of long-shaped rice grains in 2009.

Short/medium-shaped grain is normally grown as an annual plant throughout northern and northeastern China as well as in parts of eastern China.  Rice milled from this grain is characterized by its unique stickiness and glutinous texture when cooked, and thus generally favored by Chinese consumers.  Cultivation of high-quality short/medium-shaped grain requires low night-time temperature for proper starch accumulation.  Hence, short/medium-grain rice is not suitable for cultivation in the generally warmer climates of southern China.

Long-shaped grain mainly grows in southern China, normally yielding two to three crops annually.  It is long and slim, and rice milled from this grain is less glutinous than rice from short/medium-shaped grain when cooked.

Based on internal research, we believe that most Chinese consumers currently buy rice in bulk, and we estimate that approximately 40 million mt of rice were sold pre-packaged (generally 25 kilograms per bag or less) in 2008, less than 30% of the total national rice consumption.  Pre-packaged rice is generally less prone to mold and insect infestation, and easier to maintain freshness, according to a study by the Institute of Qiaoxing Light Industry of Fuzhou University.  Coupled with the convenience of smaller packaging, we believe that Chinese consumers should generally prefer pre-packaged rice, despite its higher price point, over rice sold in bulk.  If China’s urbanization and disposable income levels continue to rise as they have in recent history, we expect pre-packaged rice to eventually overtake bulk rice in consumer preference, especially in the more developed coastal regions of China, including Fujian Province where we are based and our pre-packaged rice is sold.

China’s Rice Bran Oil Industry

According to the Chinese Cereals and Oils Association, rice bran, while accounting for only 6% to 12% of the weight of each rice grain, contains 64% of all nutrients in rice.  United Nations Industrial Development Organization (UNIDO) considers rice bran an under-utilized raw material.  Rice bran oil, as its name implies, is extracted from rice bran.

According to the statistics provided by Food and Agriculture Organization of the United Nations (FAO), the global production of refined rice bran oil rose from 500,000 mt in 2006 to 744,000 mt in 2010, while demand grew from 950,000 mt to 1,190,000 mt over the same period. By 2012, FAO estimates that global production and market demand for refined rice bran oil will reach 964,000 mt and 1380,000 mt, respectively.

Base on internal research, we estimate that Chinese domestic refined rice bran oil production rose from 4,000 mt in 2006 to 33,000 mt in 2010, while demand grew from 190,000 mt to 238,000 mt over the same period.  By 2012, we project domestic production of and demand for rice bran oil to reach 63,000 mt and 276,000 mt, respectively.

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However, despite being one of the world’s largest rice consuming nations, if not the largest, China has yet to fully embrace rice bran oil.  While rice bran oil refining is not new to China, we believe that domestic production and consumption have been constrained by the complexity of technologies used in the refining process, high initial capital requirement, and relative low level of market awareness of its nutritious values.  However, we have seen large Chinese grain and edible oil companies entering this market since 2009, which we believe is driven by growing health awareness and disposable income levels in China’s recent history.  With our planned production of rice bran oil to formally commence immediately after obtaining a Production License anticipated by the end of May 2011, we believe that we are well-positioned to be one of the leading rice bran oil market players.  Based on our trial production of unfinished, or crude, rice bran oil in October 2010, we estimate that approximately 13.8 mt of rice bran is required to produce 1 mt of refined rice bran oil.  Once formal production commences, and using the rice bran that we currently sell as by-product, we estimate that the amount of refined rice bran oil produced per mt of rice bran can yield approximately RMB 441 in gross profit, compared to approximately RMB 200 per mt of rice bran currently sold as by-product.  We anticipate that by-products from the refining process, including fatty acid, rice bran wax, rice bran fat, bottom oil and soapstock, which are used in chemical production, and de-oiled rice bran, which is used for livestock feeds, will also be sold.  We estimate that the by-products generated per mt of rice bran can collectively produce approximately RMB 187 in gross profit.  Once formal production commences, we anticipate diverting all rice bran that we currently sell as by-products toward producing refined rice bran oil, and will therefore discontinue rice bran sales to feed factories and stores.

Our Competitive Strengths

We believe the following strengths differentiate us from our competitors in China:

· We are dedicated to producing the highest quality of rice through our strict quality control measures, and at the same time aim to maximizing profit margins from our production process by deriving value from our by-products such as rice hull, rice bran and broken rice.

· We source our short/medium-shaped grain predominantly from three regions in northeastern China   renown for the quality of their short/medium-shaped rice crops, namely Panjin in Liaoning Province, Bayan in Heilongjiang Province and, Jilin City and Dehui in Jilin Province.  Panjin in particular has applied with State Administration of Quality Supervision, Inspection and Quarantine for a “Protection of Geographical Indication Products” designation in order to distinguish the quality of its grain from others.

· We have a well-established and extensive sales network. Our pre-packaged rice products are sold to our distributors for wholesale and retail distribution across Fujian Province.  We also have long-term relationships with beer brewers throughout Fujian Province to supply their long-shaped grain rice needs.

· We understand the importance of branding and brand recognition.  Our “Grand Farm” brand is well-recognized in Fujian Province, and has been designated a “China Top Brand” as well as a “China Famous Trademark.”  At the same time, we price our products competitively against other brands to associate our brand with both quality and value.

· We have strong research and development capability.  We have one utility model patent for rice bran oil refining equipment and utilization and two utility patents relating to rice bran oil refining equipment.  We also have a patent application pending for rice bran oil refining method and equipment.  Our proprietary production process for nutrient-fortified rice, developed jointly with Wuhan Polytechnic University and Wuhan Dafeng Food Technology Co., Ltd., has been recognized by the Science and Technology Department of Fujian Province as a leading research effort in nutrient-fortified food processes in China.

Although we believe that our competitive strengths provide us with advantages over many of our competitors, many of our competitors have stronger brand names, longer operating histories, stronger financial performance, longer or more established relationships with their customers, stronger research and development capabilities and greater marketing and other resources than we do.  Many of them are also substantially larger and have greater access to capital than we have.  Some have stronger customer bases, better access to government authorities and stronger industry-based background than us.  If we fail to maintain or improve our market position or fail to respond successfully to changes in the competitive landscape, our business, financial condition and results of operations may suffer.

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Challenges:

We believe that the following are challenges that we currently face and may face in the future:

· Although we have established ourselves and our brand in Fujian, we face continuing competitions from major rice producers in China, and therefore must continue to maintain brand awareness in our established market but also open new market opportunities both in Fujian and beyond in order to remain competitive.

· As larger and better-resourced competitors are able to gain greater control to grain supplies, our continuing ability to meet our raw material needs will challenged unless we are able to secure long-term cooperation arrangements with suppliers for sufficient quantities of grains of suitable quality and at prices that are acceptable to us.

· Our access to and cost of grain supplies are impacted by natural disasters, which frequency in recent years drove up our raw material costs.

· Although we have established a production line for and are poised to commence production of refined rice bran oil, the market for this product remains largely undeveloped in China, and there is no assurance as to how well the market will develop, if ever.  Other Chinese rice and edible oil producers have also entered into the rice bran oil business, many of whom are bigger and better-funded than we are.

Our Strategies

· Increase Market Share.  We aim to consolidate our market share in Fujian, and then to expand into coastal cities in adjacent provinces that are economically-developed.  To that end, we aim to increase brand marketing and awareness, which we believe will facilitate our goal of selling prepackaged rice directly to national chain supermarkets, chain retail outlets and agricultural trade centers in order to expand our sales channels beyond our distributors.  We also aim to establish long-term relationships with more beer brewers in Fujian.

· Expand Production Capacity.  To be in position to sustain any market share gain, we aim to continue ramping up our production capacity, with the goal of achieving annual processing capacity of 0.8 to 1.0 million mt in the next five years.  We anticipate completing a new production line at the end of 2011 that can increase our annual production capacity to 390,000 mt.  For a description of this production line, please refer to the discussion under “Production Technology and Quality Control” below.

· Secure Raw Material Needs.  While we enjoy good relationships with our suppliers, we intend to enter into long-term strategic supply contracts with suppliers and farming collectives in order to better secure our access to grain of sufficient quality and quantity for our needs.

· Derive Maximum Value from Rice Production.  We already sell by-products from our rice production process, such as rice bran and broken rice, to livestock feed factories and stores.  In anticipation of the market potential for rice bran oil, we will use the rice bran that we currently sell to produce refined rice bran oil, and expects formal production to commence immediately after obtaining a Production License anticipated by the end of May 2011.

Products and Sales

We currently have three rice product types: (1) prepackaged rice sold under the “Grand Farm” brand and used by Chinese consumers as daily staple, (2) rice used by brewers as raw material for beer making, and (3) byproducts from rice processing used as raw materials for livestock feed.

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Our prepackaged rice comes in 5-, 10-, 15- and 25-kilogram bags and sold primarily to our distributors for wholesale and retail distribution throughout Fujian Province.  Our prepackaged rice is targeted toward middle to high-end consumers, which we believe place a premium on the quality and taste of the rice.  The majority of our prepackage rice is produced from short/medium-shaped rice grain, from which we make regular rice and a nutrient-fortified rice.  We also produce regular rice from long-shaped rice grain to appeal to consumers who may prefer a different taste and texture than rice made from short/medium-shaped grain.  Nutrient-fortified rice, which we began selling in January 2008, is produced through a proprietary process jointly developed with Wuhan Polytechnic University and Wuhan Dafeng Food Technology Co., Ltd. that spray certain naturally occurring micronutrients onto the rice that are often removed during the milling process.

We select our distributors based on geographical region and size of their distribution networks capabilities. Two to three distributors may be assigned to one region for the distribution and market monitoring of that region.  Our distributors contract with us for one year and are obligated to achieve specified purchase targets during the term.  Prices are based on prevailing market prices, although we will and have reduced our selling price on occasions to boost sales and gain market share.  Our distributors collectively accounted for 96.28%, 82.39% and 74.09% of our revenues in 2008, 2009 and 2010, respectively.

Products are delivered to our distributors door-to-door.  To support our distributors and their distribution networks, we send marketing personnel to provide onsite support in their regional and local marketing and promotional efforts, as well as to gather relevant market data to guide our overall marketing strategies.  To promote our products and raise brand awareness, we also exhibit our products at regional and national trade fairs, and advertise through television, print media, billboards and points of purchase.

The rice that we sell to beer brewers are made from long-shape rice grain and serves as the primary raw material for making beer.  We sell the rice in bulk directly to beer brewers in Fujian Province.  We typically enter into one-year contracts with the brewers setting forth quality and quantity.  Prices of our long-shaped rice are based on the fluctuation in spot prices.

To produce rice, the husk (the outer shell) of the rice grain is first removed, which results in brown rice, and then the bran (the next layer) from brown rice, which yields white rice.  We sell by-products from milling such as bran and broken rice directly to livestock feed factories and stores in bulk.

Our sales volumes and revenues for the years ended December 31, 2008, 2009 and 2010, by product, are as follows:

	Product	Sales amount (mt)		Revenue (USD’000)			% of total revenue (%)
2008	Short/medium-shaped rice		55,466		29,682			81.3
	Nutrient-fortified rice		1,869		2,140			5.9
	Long-shaped rice		4,720		1,980			5.4
	Byproducts		26,185		2,707			7.4
	Sales tax				(502	)		(1.4	)
	Total		88,240		36,007			100.0
2009	Short/medium-shaped rice		74,480		43,328			71.6
	Nutrient-fortified rice		7,753		9,474			15.7
	Long-shaped rice		11,330		4,381			7.2
	Byproducts		35,361		3,775			6.2
	Sales tax				(425	)		(0.7	)
	Total		128,924		60,533			100.0
2010	Short/medium-shaped rice		94,302		56,231			68.0
	Nutrient-fortified rice		7,488		8,878			10.7
	Long-shaped rice		27,328		12,796			15.5
	Byproducts		1,800		4,772			5.8
	Sales tax				(488	)		(0.6	)
	Total		130,919		82,677			100.0

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No single customer accounted for 10% or more of total revenues for 2008 and 2009, while one customer (AB InBev Brewery Co., Ltd.) accounted for 11.94% of our total revenue for 2010.  Other than as a customer pursuant to its contract with us, this customer is neither affiliated with nor related to us.

Raw Material and Suppliers

We currently source our short/medium rice grain primarily from the northeastern provinces of Heilongjiang, Jilin and Liaoning, specifically from Bayan in Heilongjiang, Jilin City and Dehui in Jilin, and Panjin in Liaoning.  These regions’ geographical and weather climates – wide plains and abundant summer rainfalls – are ideal for producing quality short/medium rice grain with high nutritional value.  Through 2009, 93% of our short/medium rice grain came from Panjin, a region especially renowned in China for its quality.  In 2010, however, we looked to reduce our reliance on Panjin, and began sourcing also from Heilongjiang and Jilin.  We believe that while the short/medium rice grains from these regions may be less renowned than Panjin, their quality is on par and that the quality of our products has not been, and will not be, compromised.  Nevertheless, Panjin shall continue to remain one of our primary sources for short/medium rice grain.

We source long-shaped rice from both Jiangxi and Fujian.

The main raw material of rice bran oil is rice bran, a by-product of the rice milling process.  We intend to redirect the rice bran that we currently sell to livestock feeds factories and stores to produce our refined rice bran oil.  Based on internal estimations, however, we may need to procure additional rice bran externally in order to meet projected demands for the product once formal production commences immediately after we obtain a Production License anticipated by the end of May 2011.

Our suppliers are typically local to the regions from which we source the grain, many of whom have been working with Grand Farm for five to eight years.  We currently contract with our suppliers for terms of one year for specified quantities at market price at the time of delivery.  To ensure priority on grain supplies, however, we often advance payments to our suppliers as deposits.  We currently work with approximately 44 rice grain suppliers, and believe that we have good working relationships with them.  We believe, however, that we can readily replace any of our suppliers if necessary.

The following table identifies the suppliers who each accounted for 10% or more of our total purchases during the periods indicated:

	Name of supplier	Percentage of total purchase (%)
2008	Panjin Jiahong Industrial Co., Ltd. *		30
	Dawa County Dongfeng Town Heyan Village		28
	Jiangxi Longyan Rice Co., Ltd.		13
2009	Panjin Jiahong Industrial Co., Ltd. *		21
	Jiangxi Longyan Rice Co., Ltd.		10
	Liaoyang Liaozhong County Yangshigang Town Fengju Cereal Factory		10
2010	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.		18

* Related party.  See “Related-Party Transactions” elsewhere in the prospectus.

The Chinese government monitors rice grain supplies and prices in order to maintain social stability.  During times of shortage, such as the market-driven shortage of short/medium-shaped grain from northeastern China in 2010, the Chinese government will regulate supplies and pricing by making grains from state-owned reserves available for bidding by private enterprises.  Only those deemed as a leading provincial grain processing enterprise can participate in the bidding, and the government sets a bidding range in order to stabilize market prices.  As one of Fujian’s largest rice processing company, we participated in such bidding process in 2010 as we believe that, taking into account for inflation, the prices that we would pay through bidding would still be lower than market prices.  During normal market conditions, however, the Company sources and will continue to rely primarily on private suppliers to meet its grain needs.

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44.0% of our total grain purchases in 2010 came from state-owned reserves – in Liaoning (where Panjin is located), Heilongjiang and Jilin for short/medium-shaped grains, and in Jiangxi for long-shaped grains.  Of the grains that we sourced from these state-owned reserves, 92.4% was short/medium-shaped grains, while the remaining 7.6% was long-shaped grains.  No single reserve accounted for 10% or more of our total purchases for 2010.

Production Technology and Quality Control

All of our rice products are currently produced from our production facility located in Hanjiang District in Putian, which sits on an 18,000 m2 site.  The facility has two fully-automated production lines with a combined annual milling capacity of 260,000 mt.  Our proprietary production line for nutrient-fortified rice is also located at this facility with an annual capacity of 80,000 mt.  This production line was developed jointly with the Wuhan Polytechnic University and Wuhan Dafeng Food Technology Co., Ltd.  Our rice production process is illustrated below:

From sourcing raw materials to production to sales, we strictly observe international standards and exceed PRC standards:

(1) We set specific standards for the quality of the rice grain from all suppliers and conduct on-arrival test to ensure that our standards are met.

(2) Strict control and rules are applied to and enforced at each step of the production process, including all production areas and workers’ hygiene at each such area, to ensure the quality and safety of our products.  Thus, as determined by Putian Municipal Bureau of Quality and Technical Supervision, our amount of broken rice is ten times lower than the national standard; the amount of yellow rice kernels is close to zero; and pesticide residue and heavy metal levels are much lower than permissible levels in the PRC.

(3) Our post-sales services include (1) conducting customer feedback; (2) resolving customer issues; and (3) replacing damaged products.  Also, we conduct customer satisfaction survey on a yearly basis to improve the quality of our products and services as well as customer satisfaction.

For our efforts, we have obtained the “Adopting International Standard Product Marking” Certificate from Standardization Administration of the PRC.  We have also obtained the ISO9001:2008 Quality Control System and Product certification, the HACCP Food Safety Control System certification, and the ISO14001:2004 Environment Control System certification.

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We have also set up a new production facility on a leasedsite in proximity to our Putian facility.  The facility, 11,611 m2 in size, contains an integrated rice bran oil production line with proprietary cutting-edge technology, including puffing and leaching units, refining unit and other supporting facilities, with a designed annual production capacity of 24,000 mt.  We commenced trial production of unfinished, or crude, rice bran oil in October 2010.  We are currently applying for a Production License with the Administration of Quality Inspection of Fujian Province, which we must have prior to commencement of formal production.  If our application process is successful, in addition to the issuance of the Production License, our refined rice bran oil can carry a “QS” label when it is introduced into the market.  We currently anticipate completing the application process and obtaining the Production License by the end of May 2011, and to commence formal production of refined rice bran oil immediately thereafter.  The timing and results of the application process, however, are ultimately beyond our control, and there is no assurance that of when we will be issued the Production License, if at all.

Our rice bran oil production process is illustrated below:

In addition to refined rice bran oil, this facility will also house another rice production line with projected annual rice grain processing capacity of 90,000 mt, yielding approximately 60,000 mt of milled rice.  Because the building that this production line will occupy requires modifications to accommodate our equipment, we are in the process of registering the plan for the modifications with the Putian Development and Reform Commission, and allowing the Putian Environmental Protection Bureau to complete an environmental impact study in connection with such modifications.  We currently expect to complete these steps in May 2011, the modifications to the building in September 2011 and the installation of the production line by the end of 2011, and to commence formal production immediately thereafter.

Competition

We operate in a highly fragmented industry.  Based on the 5.1 million mt of milled rice that we estimate were consumed in Fujian in 2010, only approximately 2.21% were our rice products.  Our direct competitors are: Heilongjiang Beidahuang Agricultural Co., Limited, Yihai Kerry Group and China National Cereals, Oils and Foodstuffs Corp.  We believe that the principal factors affecting our competitive position are:

· Continuing ability to access grains of quality and quantity to meet our needs;

· Ability to build brand awareness and foster brand loyalty; and

· Ability to maintain existing sales distribution channels and develop new markets

Many of our competitors may have stronger brand names, stronger customer bases, greater access to capital, longer operating histories, longer or more established relationships with their customers and greater marketing and other resources than we do.  If we fail to maintain or improve our market position or fail to respond successfully to changes in the competitive landscape, our business, financial condition and results of operations may suffer. For a discussion of risks relating to competition, see “Risk Factors — The Chinese agricultural market is highly competitive and our growth and results of operations may be adversely affected if we are unable to compete effectively.”

Research and Development

We conduct research and development from our Putian facility, and we have focused on rice processing, rice bran oil production and production equipment, and nutrient-fortification process through cooperation with various agricultural universities and scientific institutes in Fujian.

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Our research and development efforts in recent years include the following:

· Working with Wuhan Polytechnic University and Wuhan Dafeng Food Technology Co., Ltd., we have jointly developed a method of spraying nutrients onto rice that allows the nutrients to be retained after the rice is washed while at the same time preserving the flavor of the rice. In April 2008, the method was recognized and certified by the Department of Science & Technology of Fujian Province (No.41 [2008] Min-Sci).  In April 2010, we were jointly designated a “National Key Research and Development Base for Nutrient-fortified Food” by the National Office of Public Nutrition Improvement Project, the Public Nutrition Development Center of the National Development and Reform Committee, and the Chinese Cereals and Oils Association - Nutrition Branch. We currently use the method to produce our nutrient-fortified rice product.

· We worked with Henan Huaxian Food Equipment Factory and Henan Huatai Edible Oil Equipment Design Co., Ltd., to develop and establish equipment for processing and refining rice bran oil, based in part on two of our utility patents.  We have incorporated such equipment units into our refined rice bran oil production line.

We spent approximately $10,396, $14,075 and $19,767 on salaries related to research and development in 2008, 2009 and 2010, respectively. In addition, we incurred approximately $2,121, $2,157 and $2,176 of depreciation expenses related to research and development in 2008, 2009 and 2010, respectively.

Intellectual Property

Our success and ability to compete depend, in part, upon our ability to establish and adequately protect our intellectual property rights.  In this regard, we rely primarily on a combination of patent, trademark, trade secret and unfair competition laws and contractual rights.  We have three utility patents in China, for (1) rice bran oil refining equipment and utilization, (2) comprehensive utilization of equipment for rice bran oil refinement, and (3) industrialized refining equipment for rice bran oil.  We also have one patent application pending relating to rice bran oil refining method and equipment.

We have 22 trademarks registered in China, and have submitted an application to register the logo reflected on the cover page of this prospectus with the Trademark Office of The State Administration for Industry and Commerce of the PRC, or the PRC Trademark Office.  In addition, our “Grand Farm” brand was designated a “China Top Brand” in September 2007, and a “China Famous Trade Mark” in January 2010.  The “China Top Brand” designation is an honorary award and signifies that the underlying products or services are reputable and well-recognized.   The “China Famous Trademark” designation is issued either by the PRC Trademark Office or an intermediate (or higher level) people’s court, and signifies that a trademark is well known.

 We also own the domain name “grandfarminc.com.”

Environmental Protection

We have passed the Construction Project’s Impact on Environment Assessment conducted by the Environment Protection Bureau of Hanjiang District, Putian City of Fujian Province, or the Hanjiang Environment Protection Bureau, and passed the acceptance inspection procedures and obtained a formal waste discharge permit for our first production facility. We have also completed the environmental inspection acceptance procedures for our second production facility, and we are in the process of obtaining its formal waste discharge permit.

Employees

The following table sets forth the number of our employees in each of our areas of operations and a percentage of our total workforce in each of the years ended December 31, 2008, 2009 and 2010, respectively:

	Average Number of Employees for the Years Ending December 31,
	2008					2009					2010
	Employees		Percentage			Employees		Percentages			Employees		Percentages
Operations		51		56.7	%		60		51.7	%		71		53.4	%
Administration		25		27.8	%		27		23.3	%		28		21.1	%
Marketing		10		11.1	%		25		21.6	%		29		21.8	%
R&D		4		4.4	%		4		3.4	%		5		3.8	%
Total		90		100	%		116		100	%		133		100	%

Beginning in 2010, we have outsourced most human resource functions to an outside agency as part of our efforts to streamline our operations, which handles our employees’ salaries, social benefits and other related issues.  Our full-time employees in the PRC participate in a government mandated multi-employer defined contribution plan pursuant to which pension, unemployment insurance, health insurance, employee housing, workplace injury and maternity benefits are to be provided to employees.  Chinese labor regulations require the Company to contribute for these benefits based on certain percentages of the employees’ salaries.  In 2008 and 2009, we contributed $2 thousand and $3 thousand for such benefits, respectively.  We later determined that our contributions should have been $29 thousand and $33 thousand for 2008 and 2009, respectively.  After further evaluation, however, we concluded that such amounts were understated by $27 thousand and $41 thousand for 2008 and 2009, respectively.  Thus, taking into account the amounts that we paid, we were obligated to contribute an additional $54 thousand and $71 thousand for such benefits for 2008 and 2009, respectively, which amounts were paid in full in 2011.  But see “Risk Factors – Risks Related to Doing Business in China – Our failure to comply with PRC labor laws exposes us to potential liability.”  We have also contributed in full our obligations for such benefits for 2010, in the amount of $83 thousand.

We believe we maintain a good working relationship with our employees, and we have not experienced any significant labor disputes or any difficulty in recruiting staff for our operations.  Our employees are not covered by any collective bargaining agreements.

Legal Proceedings

We may be subject to legal proceedings, investigations and claims incidental to the conduct of our business from time to time.  We are not currently a party to, nor are we aware of, any legal proceeding, investigation or claim which, in the opinion of our management, is likely to have a material adverse effect on our business, financial condition or results of operations.

REGULATION

We are subject to a number of laws and regulations issued by various PRC governmental authorities, including:

· Ministry of Agriculture;

· National Development and Reform Commission;

· State Administration of Grain;

· General Administration of Quality Supervision, Inspection and Quarantine;

· Ministry of Environmental Protection;

· Foreign Economic Relations & Trade Commission;

· State Food and Drug Administration, or SFDA; and

· The State Administration of Foreign Exchange, or SAFE.

The laws and regulations issued by these PRC governmental authorities that regulate us and our business are discussed below.

Food Safety Law of the People’s Republic of China

The Food Safety Law of the PRC, or the Food Safety Law, as adopted at the 7th Session of the Standing Committee of the 11th National People’s Congress of the PRC and which became effective on June 1, 2009, governs food safety in food production and business operation activities in the PRC.  Pursuant to the Food Safety Law, food producers must establish an internal inspection and record system for raw materials and pre-delivery products, and food distributors must also establish internal systems to record and inspect food products procured from suppliers.  In addition, any food additives that are not in the government’s approved catalogue may not be used, and no food products may be sold without inspection by either the Administration of Industry and Commerce or the Food and Drug Administration at the county level or above. 

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Penalties for violation of the Food Safety Law include warnings, orders to rectify, confiscations of illegal gains, confiscations of utensils, equipment, raw materials and other articles used for illegal production and operation, fines, recalls and destruction of food products, orders to suspend production and/or operation, revocations of production and/or operation license, and even criminal punishment, depending on the severity of the violation.

The Food Safety Law also states that the executive departments of the administration of quality supervision, the administration for industry and commerce, and the food and drug administration at the county level or above have the right to take the following actions in the course of performing their respective duties of regulating food safety: (1) enter production and trading sites for field inspection; (2) conduct sample testing on food being produced or traded; (3) review and copy relevant contracts, documents, notebooks, and other information; (4) seal up and detain food proven to violate food safety standards, illegally used food raw materials, food additives, and food-related products as well as equipment and tools contaminated or used for illegal production or trading; and (5) closing down places of illegal production and trading of food.

Regulations on the Implementation of the Food Safety Law of the People’s Republic of China

The Regulations on the Implementation of the Food Safety Law of the PRC, or the Food Safety Regulations, as adopted at the 73rd Standing Committee Meeting of the State Council on July 8, 2009 and which became effective on July 20, 2009, are promulgated to implement the Food Safety Law.  The Food Safety Regulations require that the local government at or above the country level shall perform the responsibility specified in the Food Safety Law, improve the ability for supervision and administration of food safety, ensure supervision and administration of food safety, establish and improve the coordination mechanism between food safety regulatory authorities, and integrate and improve the sharing of food safety and food inspection information and other technical resources.

Under such regulation, if we fail to set up and implement a food safety management system, or to formulate and implement a production process control, or to record safety management in the food production and keep relevant records, we may be subject to penalty in accordance with the Food Safety Law.

Law of the People’s Republic of China on Quality and Safety of Agricultural Products

The Law of the PRC on Quality and Safety of Agricultural Products was adopted at the 21st Meeting of the Standing Committee of the Tenth National People’s Congress on April 29, 2006.  This law was enacted in order to ensure the quality and safety of agricultural products, maintain the health of the general public, and promote the development of agriculture and rural economy.  Pursuant to this law, distributors of agricultural products shall establish a sound system of inspection and acceptance for their purchases.  In addition, agricultural products that fail to pass inspection based on the quality and safety standards for agricultural products cannot be marketed.

Producers or distributors of agricultural products produced or sold that cause damage to consumers are held liable for compensation and may be subject to administrative penalties.  Punitive measures for violations of this law include the issuance of rectification orders, stop orders against the sale of agricultural products, order for the innocuous treatment of the endangering products, confiscation of the sale proceeds thereof and the imposition of fines.  In the event of serious violations, the agricultural product producer or distributor may be held criminally liable.

In addition, the administrative departments for agriculture under the people's governments at or above the county level shall, in compliance with the requirements for ensuring the quality and safety of agricultural products, draw up plans for monitoring the quality and safety of agricultural products and organize implementation of the plans, and conduct regular supervision and make spot checks of the agricultural products under production or on the market.  The results of such supervision and spot checks shall be published by the administrative department for agriculture under the State Council, or by such department under the people's government of a province, autonomous region, or municipality directly under the Central Government within the limits of its powers. Supervision, spot check and test shall be entrusted to the agencies to ensure that agricultural products meet the required quality and safety standards.

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Regulation of the People’s Republic of China on the Administration on Production License of Industrial Products

The Regulation for the Administration of Production License of Industrial Products of the PRC, or the Production License Regulation, as adopted at the 97th Standing Committee Meeting of the State Council on June 29, 2005, and which became effective on September 1, 2005, are to ensure the safety and quality of important industrial products that are directly relevant to public safety, human health, and safety of human lives.  The Production License Regulation prohibits any enterprise that fails to obtain a production permit/license to produce products listed in the Catalogue of Industrial Products, and no organization or individual is allowed to sell or use products listed in the Catalogue of Industrial Products for which a production permit/license was not obtained.

The competent department in charge of production licensing of industrial products will order an enterprise in violation of the Product Permit Provisions to stop production, and will additionally confiscate illegally produced products and impose a fine ranging from the equivalent value of the products illegally produced to 3 times such value.

As required under the Implementation Measures of the Production License Regulation promulgated by the State Administration of Quality Supervision, Inspection and Quarantine on August 31, 2005, and amended on June 1, 2010, we have already obtained the Production License required for our milled rice products, and are currently in the process of applying for the Production License for our refined rice bran oil, which we must have prior to commencement of formal production.  There can be no assurance, however, that we will receive the Production License as anticipated, if at all.  See “Risk Factors – Risks Relating to our Business – We cannot commence production of refined rice bran oil until we have the required Production License.”

Administrative Regulation on Cereal Circulation

The Administrative Regulation on Cereal Circulation was adopted at the 50th Executive Meeting of the State Council on May 19, 2004.  This regulation is to protect the initiatives of cereal producers, promote cereal production, safeguard the legitimate rights and interests of the business operators and consumers, ensure the food security of the state and maintain the order of cereal circulation.  This regulation requires all individuals and enterprises engaging in the purchase of cereal to have approval of the competent cereal administrative department or undergo the registration formalities with the competent state administration for industry and commerce.

Any individual or enterprise in violation of this regulation shall have their illegally purchased cereal confiscated.  If the circumstance is serious, such individual or enterprise shall be fined from 2 to 5 times the value of the illegally purchased cereals, and if any crime is constituted, such individual or enterprise shall be subject to criminal liabilities.  We have already obtained the Cereal Purchase License from Putian Municipal Bureau of Grain.

Regulations on the Administration of Central Grain Reserves

The Regulations on the Administration of Central Grain Reserves was adopted at the 17th Executive Meeting of the State Council on August 8, 2003.  These regulations were to strengthen the administration of central grain reserves, secure the true quantity, good quality and safe storage of central grain reserves, protect the rights and interests of peasants, maintain market stability and give into full play the sole of central grain reserves in the national macro-control mechanism.  These regulations apply to the organizations and individuals engaging or participating in the operation, management or supervision of central grain reserves.  According to these regulations, the state shall apply a vertical administration system to central grain reserves, and the people’s governments at all levels and the relevant departments shall provide support and assistance to the vertical administration of central grain reserves.

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When a central grain storage enterprise violates these regulations, its illegal gains, if any, shall be confiscated, the person-in-charge who bears direct responsibilities for the violations shall be given disciplinary sanctions ranging from demotion in title or rank to dismissal, and all other persons bearing direct responsibilities shall be given disciplinary sanctions ranging from warning to dismissal.  If a crime is constituted, the criminal liability shall be investigated, and such enterprise shall be disqualified from further involvement with the storage of central grain reserves.

Labor Law

The Employment Contract Law was promulgated by the National People’s Congress’ Standing Committee on June 29, 2007 and took effect on January 1, 2008.  The Employment Contract Law governs labor relations and employment contracts (including the entry into, performance, amendment, termination and determination of employment contracts) between domestic enterprises (including foreign-invested companies), individual economic organizations and private non-enterprise units (collectively referred to as the “employers”) and their employees.

a.           Execution of employment contracts

Under the Employment Contract Law, an employer is required to execute written employment contracts with its employees within one month from the commencement of employment.  In the event of contravention, an employee is entitled to receive double salary for the period during which the employer fails to execute an employment contract.  If an employer fails to execute an employment contract for more than 12 months from the commencement of the employee’s employment, an employment contract would be deemed to have been entered into between the employer and employee for a non-fixed term.

b.           Right to non-fixed term contracts

Under the Employment Contract Law, an employee may request for a non-fixed term contract without an employer’s consent to renew in certain circumstances.  In addition, an employee is also entitled to a non-fixed term contract with an employer if he has completed two fixed term employment contracts with such employer; however, such employee must not have committed any breach or have been subject to any disciplinary actions during his employment.  Unless the employee requests to enter into a fixed term contract, an employer who fails to enter into a non-fixed term contract pursuant to the Employment Contract Law is liable to pay the employee double salary from the date the employment contract is renewed.

c.           Compensation for termination or expiry of employment contracts

Under the Employment Contract Law, employees are entitled to compensation upon the termination or expiry of an employment contract in certain circumstances.  Employees are entitled to compensation even in the event the employer (i) has been declared bankrupt; (ii) has its business license revoked; (iii) has been ordered to cease or withdraw its business; or (iv) has been voluntarily liquidated.  Where an employee has been employed for more than one year, the employee will be entitled to such compensation equivalent to one month’s salary for every completed year of service.  Where an employee has employed for less than one year but more than six months, such employee will be deemed to have completed one full year of service.

d.           Trade union and collective employment contracts

Under the Employment Contract Law, a trade union may seek arbitration and litigation to resolve any dispute arising from a collective employment contract; provided that such dispute failed to be settled through negotiations.  The Employment Contract Law also permits a trade union to enter into a collective employee contract with an employer on behalf of all the employees.

Where a trade union has not been formed, a representative appointed under the recommendation of a high-level trade union may execute the collective employment contract.  Within districts below county level, collective employment contracts for industries such as those engaged in construction, mining, food and beverage and those from the service sector, etc., may be executed on behalf of employees by the representatives from the trade union of each respective industry.  Alternatively, a district-based collective employment contract may be entered into.

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As a result of the Employment Contract Law, all of our employees have executed standard written employment agreements with us.  We have not experienced any significant labor disputes or any difficulties in recruiting staff for our operations.  See “Our Business — Employees.”  Failure to comply with this law will subject us to penalties and sanctions.  See “Risk Factors — Risks Related to Doing Business in China — New labor laws in the PRC may adversely affect our results of operations, and Our failure to fully comply with PRC labor laws exposes us to potential liability.”

Environmental Regulations

On December 26, 1989, the Standing Committee of the National People’s Congress issued the Environment Protection Law, setting forth the legal framework for environment protection in China.  The Environmental Protection Law requires the State Administration of Environmental Protection to implement uniform supervision and administration of environmental protection standards nationwide and to establish national waste discharge standards.  Local environmental protection bureaus are responsible for environmental protection in their jurisdictions and may set stricter local standards which are required to be registered at the State Administration of Environmental Protection.  Companies are required to comply with the stricter one of the two standards. Enterprises producing environmental contamination and other public hazards must incorporate the relevant environmental protection standards into their planning and establish environmental protection systems.  These companies must also adopt effective measures to prevent environmental contamination and hazardous emissions, such as waste gas, waste water, deposits, dusts, pungent gases and radioactive matters as well as noise, vibration and magnetic radiation.  Companies discharging contaminated wastes in excess of the discharge standards prescribed by the State Administration of Environmental Protection must pay non-standard discharge fees in accordance with national regulations and be responsible for the applicable remediation.  Government authorities may impose different penalties against persons or companies in violation of the environmental protection laws and regulations depending on individual circumstances.  Such penalties may include warnings, fines, imposition of deadlines for remediation, orders to cease certain operations, orders to reinstall contamination prevention and remediation facilities that have been removed or left unused, imposition of administrative actions against the responsible persons or orders to close down the company.  Where the violation is deemed serious, responsible persons may be required to pay damages, and may be subject to criminal liability.

Additionally, on November 29, 1998, the State Council of the PRC promulgated the Regulations on the Administration of Construction Project Environmental Protection, or the Construction Project Environmental Protection Regulations, which require construction projects that generate pollution to comply with both state and local standards for the discharge of pollutant; requirements for aggregate control of discharge of major pollutants must also be met in areas under aggregate control of discharge of major pollutants.  These regulations further require that a construction unit should, in the phase of construction project feasibility study, submit a construction project environment impact report, environmental impact statement or environmental impact registration form, which shall be submitted by the construction unit to the competent departments of the environmental protection administration with the appropriate authority for examination and approval.  Failure to comply with such laws and regulations will subject us to penalties and sanctions.  See “Risk Factors —Risks Relating to Our Business—Environmental compliance and remediation could result in substantially increased capital requirements and operating costs which could adversely affect our business.”

Regulations on Trademarks

Both the PRC Trademark Law, adopted in 1982 and revised in 1993 and 2001, and the Implementation Regulation of the PRC Trademark Law adopted by the State Council in 2002, give protection to the holders of registered trademarks.  The Trademark Office, under the authority of the State Administration for Industry and Commerce, handles trademark registrations and grants rights for a term of ten years for registered trademarks, which may be renewed by the Trademark Office.  The PRC Trademark Law has adopted a “first-to-file” principle with respect to trademark registration.  Where a trademark for which a registration has been made is identical or similar to another trademark which has already been registered or been subject to a preliminary examination and approval for use on the same kind of or similar commodities or services, the application for registration of such trademark may be rejected.  Any person applying for the registration of a trademark may not prejudice the existing right first obtained by others, nor may any person register in advance a trademark that has already been used by another party and has already gained a “sufficient degree of reputation” through such party’s use.  Trademark license agreements must be filed with the Trademark Office or its regional offices.

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Under the Trademark Law, any of the following acts is deemed as an infringement to the right to exclusive use of a registered trademark: (i) using a trademark identical with or similar to the registered trademark of the same kind of commodities or similar commodities without a license from the registrant of that trademark; (ii) selling the commodities that infringe upon the right to exclusive use of a registered trademark; (iii) forging, manufacturing without authorization the marks of a registered trademark of others, or selling the marks of a registered trademark forged or manufactured without authorization; (iv) changing a registered trademark and putting the commodities with the changed trademark into the market without the consent of the registrant of that trademark; and (v) causing other damage to the right to exclusive use of a registered trademark of another person. In the event of any of the foregoing acts, the infringer would be imposed a fine, ordered to stop the infringement acts immediately and give the infringed party compensation.

PRC Patent Law

The PRC first allowed patents for the protection of proprietary rights, as set forth in the PRC Patent Law, in 1985.

Patent Prosecution

The patent prosecution system in China is different from the system in the United States in a number of significant ways.  China, like most countries other than the United States, follows the ‘‘first to file’’ principle.  In other words, when more than one person files a patent application for the same invention, the patent will be granted to the person who first filed the application.  The United States, in contrast, uses a principle of first to invent to determine the granting of patents.  In addition, the PRC requires absolute novelty in order for an invention to be patentable.  Pursuant to this requirement, generally, with limited exceptions, any prior written or oral publication in or outside the PRC, demonstration or use in the PRC before the patent application filing prevents an invention from being patented in the PRC.  Conversely, subject to certain statutory requirements, inventors in the United States can generally file a patent application within one year after publication of the invention if the inventor can demonstrate that the invention was made prior to the publication.  Patents issued in the PRC are not enforceable in Hong Kong, Taiwan or Macau, each of which has an independent patent system.  The fact that a patent application is pending is no guarantee that a patent will be granted, and even if granted, the scope of a patent may not be as broad as that of the initial application.

Patent Enforcement

When a patent infringement dispute arises, the patent holder or an interested party who believes the patent is being infringed may either file a civil lawsuit or file a complaint with the relevant authorities in charge of the patent administration.  A PRC court may grant the patent holder’s or the interested party’s request for a preliminary injunction before or during the legal proceeding.  Damages for infringement are calculated as either (1) the loss suffered by the patent holder or the interested party due to the infringement or (2) the benefit gained by the infringer from the infringement.  If it is difficult to ascertain damages in this manner, damages may be determined by using a reasonable multiple of the license fee under a contractual license.  Typically, a patent holder in the PRC has the burden of proving that the patent is being infringed.  However, if the holder of a production process patent alleges infringement of such patent, the alleged infringing party which produces the same kind of products has the burden of proving that there has been no infringement.

Compulsory Licensing

Under the PRC Patent Law, where any entity is qualified to utilize a patented technology, but fails to obtain the license from the patent holder on reasonable terms and in a reasonable period of time, the entity is entitled to apply to the State Intellectual Property Office for a compulsory license.  A compulsory license can also be granted where a national emergency or any extraordinary state of affairs occurs, where the public interest so requires, or where a registered invention is substantially superior to a prior invention in connection with technology that has a notable economic significance and the application of the later invention relies on the application of the prior invention.

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International Patent Treaties

The PRC is also a signatory to major intellectual property conventions, including the Paris Convention for the Protection of Industrial Property, Madrid Agreement on the International Registration of Marks and Madrid Protocol, Patent Cooperation Treaty, Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure and the Agreement on Trade-Related Aspects of Intellectual Property Rights, or TRIPs.  Although patent rights are national rights, there is a large amount of international co-operation under the Patent Cooperation Treaty, or the PCT, to which China is a signatory.  Under the PCT, applicants in one country can seek patent protection for an invention simultaneously in a number of other member countries by initially filing a single international patent application pursuant to the PCT and then later filing individual country or region specific applications on the international patent application.

Liabilities

According to the Patent Law, an infringer shall be subject to various civil liabilities, which include ceasing the infringement and compensating the actual loss suffered by patent owners.  If it is difficult to calculate the actual loss suffered by the patent owner, the illegal income received by the infringer as a result of the infringement or if it is difficult to calculate the illegal income, a reasonable amount calculated with reference to the patent royalties shall be deemed as the actual loss.  If damages cannot be established by any of the above methods the court can decide the amount of the actual loss up to RMB 1,000,000.  In addition, an infringer who counterfeits patents of third parties shall be subject to administrative penalties or criminal liabilities if applicable.

New M&A Regulations and Overseas Listings

On August 8, 2006, six PRC regulatory agencies, including the Ministry of Commerce, the State Assets Supervision and Administration Commission, the State Administration for Taxation, the State Administration for Industry and Commerce, the CSRC and the SAFE, jointly issued the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, or the New M&A Rule, which became effective on September 8, 2006. This New M&A Rule, among other things, includes provisions that purport to require that an offshore special purpose vehicle formed for purposes of overseas listing of equity interests in PRC companies and controlled directly or indirectly by PRC companies or individuals obtain the approval of the CSRC prior to the listing and trading of such special purpose vehicle’s securities on an overseas stock exchange.

On September 21, 2006, the CSRC published on its official website its approval procedures for overseas listings by special purpose vehicles.  The CSRC approval procedures require the filing of certain documents with the CSRC and may take several months to complete.  However, other than documents required to be submitted, no other details with respect to the timing, criteria and process for obtaining any required approval from the CSRC have been specified.  Therefore, it remains unclear how the New M&A Rule or the CSRC procedures will be interpreted, amended and implemented by the relevant authorities.  See “Risk Factors — Risks Associated with Doing Business in China — The application of PRC regulations relating to the overseas listing of PRC domestic companies is uncertain, and we may be subject to penalties for failing to request approval of the PRC authorities prior to listing our shares in the U.S.”

 Tort Liability Law

The Tort Liability Law of the People’s Republic of China, which was passed during the 12th Session of the Standing Committee of the 11th National People’s Congress on December 26, 2009, states that manufacturers are liable for damages caused by defects in their products and sellers are liable for damages attributable to their fault.  If the defects are caused by the fault of third parties such as the transporter or storekeeper, manufacturers and sellers are entitled to claim for compensation from these third parties after paying the compensation amount.

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Foreign Exchange Control and Administration

Foreign exchange in China is primarily regulated by:

· The Foreign Currency Administration Rules (1996), as amended; and

· The Administration Rules of the Settlement, Sale and Payment of Foreign Exchange (1996), or the Administration Rules.

Under the Foreign Currency Administration Rules, the Renminbi is convertible for current account items, including the distribution of dividends, interest payments, and trade and service-related foreign exchange transactions.  Conversion of Renminbi into foreign currency for capital account items, such as direct investment, loans, investment in securities and repatriation of funds, however, is still subject to the approval of SAFE.  Under the Administration Rules, foreign-invested enterprises may only buy, sell and remit foreign currencies at banks authorized to conduct foreign exchange transactions after providing valid commercial documents and, in the case of capital account item transactions, only after obtaining approval from SAFE.

Under the Foreign Currency Administration Rules, foreign-invested enterprises are required to complete the foreign exchange registration and obtain the registration certificate.  The profit repatriated to us from Grand Farm China, however, is not subject to the approval of the foreign exchange authority, because it is a current account item transaction.

The value of the Renminbi against the U.S. dollar and other currencies may fluctuate and is affected by, among other things, changes in China’s political and economic conditions.  Historically, the conversion of Renminbi into foreign currencies, including U.S. dollars, has been based on rates set by the People’s Bank of China.  On July 21, 2005, the PRC government changed its policy of pegging the value of the Renminbi to the U.S. dollar.  Under the new policy, the Renminbi will be permitted to fluctuate within a band against a basket of certain foreign currencies.  There remains significant international pressure on the PRC government to adopt a substantial liberalization of its currency policy, which could result in a further and more significant appreciation in the value of the Renminbi against the U.S. dollar.

The fluctuation of the Renminbi against the U.S. dollar and other currencies may have an impact on our figures in our consolidated financial information presented elsewhere in this prospectus.  See “Risk Factors — Risks Related to Doing Business in China — Fluctuation in the value of the Renminbi may have a material adverse effect on your investment.”

Regulation on Special Purpose Vehicle Incorporated or Controlled by PRC Residents

SAFE issued the Notice on Issues Relating to the Administration of Foreign Exchange in Fund-raising and Reverse Investment Activities of Domestic Residents Conducted via Offshore Special Purpose Companies, or Circular 75, on October 21, 2005, which became effective as of November 1, 2005, and the operating procedures in May 2007, collectively the SAFE rules.  According to the SAFE rules, prior registration with the local SAFE branch is required for PRC residents to establish or to control an offshore company for the purposes of financing that offshore company with assets or equity interests in an onshore enterprise located in the PRC.  In addition, amended registrations are required upon (i) any change in the net assets of such offshore entity as a result of any acquisition of onshore assets or equity interests by such offshore entity or subsequent overseas equity financing, and (ii) any material change in the shareholding or capital of such offshore entity, such as changes in share capital, share transfers and long-term equity investments.

Under this regulation, the SAFE registration and amendment procedures described above are prerequisites for other approval and registration procedures necessary for capital inflow from the offshore entity, such as inbound investments or shareholders loans, or capital outflow to the offshore entity, such as the payment of profits or dividends, liquidation distribution, equity sales proceeds, or return of funds upon a capital reduction.  Further, this regulation requires repatriation into China by PRC residents of all dividend profits or capital gains that they obtain from their shareholdings in the offshore entity within 180 days upon their receipt of such profits or gain.  Failure to comply with this regulation will subject relevant PRC residents to penalties under PRC foreign exchange administration regulations.  See “Risk Factors — Risks Related to Doing Business in China.”

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Regulation on PRC Resident’s Participation of Share Option Plan Offered by an Offshore Company

On December 25, 2006, the PBOC issued the Administration Measures on Individual Foreign Exchange Control, and its Implementation Rules was issued by SAFE on January 5, 2007, which both of which became effective on February 1, 2007.  Under these regulations, all foreign exchange matters involved in the employee stock ownership plan, stock option plan and etc. participated by onshore individuals shall be transacted upon the approval from the SAFE or its authorized branch.  On March 28, 2007, SAFE promulgated the Application Procedure of Foreign Exchange Administration for Domestic Individuals Participating in Employee Stock Holding Plan or Stock Option Plan of Overseas-Listed Company, or Circular 78.  Under Circular 78, PRC citizens who are granted stock options or restricted share units, or issued restricted shares by an overseas publicly listed company are required, through a PRC agent or PRC subsidiary of such overseas publicly-listed company, to complete certain other procedures and transactional foreign exchange matters under the stock option plan upon the examination by, and approval of, SAFE. Failure by such employees and their PRC employer to comply with these regulations may be subject to fines and legal sanctions.

Further, in 2005 and 2006, the Ministry of Finance and the State Administration of Taxation jointly issued notices concerning the individual income tax on earnings from employee stock options.  The notice requires PRC companies that implement employee share option programs in the PRC, under which the shares issuable are the shares of listed companies (domestic or overseas), to (i) file the employee share option plans and other relevant documents to the local taxation departments having jurisdiction over them before implementation of such employee share option plans; and (ii) file share option exercise notices and other relevant documents with the local taxation departments having jurisdiction over them before exercise by the employees of the share options.  Failure to comply with this regulation will subject us to penalties and sanctions.  See “Risk Factors — Risks Related to Doing Business in China — We may be subject to fines and legal sanctions if we or our employees who are PRC citizens fail to comply with recent PRC regulations relating to employee stock options granted by overseas listed companies to PRC citizens.”

We currently do not have any employee stock ownership or option plan in effect, nor any stock options outstanding.

Dividend Distributions

Pursuant to the Foreign Currency Administration Rules promulgated in 1996 and amended in 1997 and 2008, respectively, and various regulations issued by SAFE, and other relevant PRC government authorities, the PRC government imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out of China.

Grand Farm WFOE is regulated by the laws governing foreign-invested enterprises in the PRC.  Accordingly, it is required to allocate 10% of its after-tax profits based on PRC accounting standards each year to their general reserves until the accumulated amount of such reserves has exceeded 50% of its registered capital, after which no further allocation is required to be made.  These reserve funds, however, may not be distributed to equity owners except in accordance with PRC laws and regulations. In addition, due to the failure of the Measures to define or interpret the terms “non-profit,” “for-profit” or “for the purpose of making a profit” as they relate to our business, we cannot assure you that the PRC government authorities will not request our subsidiary to use its after-tax profits for its own development and restrict our subsidiary’s ability to distribute their after-tax profits to us as dividends.

Pursuant to the new EIT law and its implementing rules, dividends payable by a foreign-invested enterprise to its foreign enterprise (but not individual) investors will be subject to a 10% withholding tax if the foreign investors are considered non-resident enterprises without any establishment or place of business within China or if the dividends payable have no connection with the establishment or place of business of the foreign investors within China, to the extent that the dividends are deemed China sourced income, unless any such foreign investor’s jurisdiction of incorporation has a tax treaty with China that provides for a different withholding arrangement.  See “Risk Factors — Risks Related to Doing Business in China — To fund any cash requirements we may have, we may need to rely on dividends, loans or advances made by our PRC subsidiary, Grand Farm WFOE, which are subject to limitations and possible taxation under applicable PRC laws and regulations.”

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Tax Collection and Management Law

Under the Tax Collection and Management Law and its implementation rules issued in 2001 and 2002, respectively, arrangements and transactions among related parties may be subject to audit or challenge by the PRC tax authorities.  “Related parties” are defined as organizations or entities that (1) have a direct or indirect control relationship in terms of capital, operation or sales/purchases; (2) are directly or indirectly owned by a common third party; or (3) possess any other connected relationship based on equity.  We could face material and adverse tax consequences if the PRC tax authorities determine that contractual arrangements between Grand Farm WFOE and Grand Farm China were not made on an arm’s length basis and adjust our income and expenses for PRC tax purposes in the form of a transfer pricing adjustment.  A transfer pricing adjustment could result in a reduction, for PRC tax purposes, of adjustments recorded by Grand Farm China, which could adversely affect us by (i) increasing Grand Farm China’s PRC tax liability without reducing Grand Farm WFOE’s PRC tax liability, which could result in claims being made against us by the PRC tax authorities for underpaid PRC taxes; or (ii) limiting the ability of Grand Farm WFOE and Grand Farm China to maintain preferential PRC tax treatments and other financial incentives.  See “Risk Factors — Risks Relating to Our Structure — Grand Farm WFOE’s and Grand Farm China’s contractual arrangements may result in adverse PRC tax consequences to us.”

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DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

The following table sets forth information regarding our directors and executive officers as of the date of this prospectus.

Name	Age	Position
Jianshan Yao	42	Chairman of the Board of Director
Chaotang Li	39	Director and Strategic Development Director
Kaigang Cheng	37	Chief Executive Officer
Biyun Huang	36	Chief Financial Officer
Kam Por Cheng	44	Independent Director Appointee*
Qinglong Li	66	Independent Director
Feng Liang	37	Independent Director

* Kam Por Cheng has accepted appointment to serve as our independent director, effective upon the completion of this offering.

Jianshan Yao – Chairman

Mr. Yao has over 20 years of experience in the grain business, including rice processing technology development, rice production and marketing.  Mr. Yao founded Grand Farm China in June 2001 and has served as its Chairman since that time, as well as serving as its Chief Executive Officer from June 2001 to August 2010. Mr. Yao is principally responsible for developing our strategic objectives and supervising the execution of our business plans and policies.  Mr. Yao is also actively involved with the Chinese Cereals and Oils Association, serving as a Director as well as Vice-Chairman of its Nutrition Branch and Standing Director of its Food Branch, and is also Vice-President of the Grain Profession Association of Fujian Province.

Chaotang Li – Director and Strategic Development Director

Mr. Li has 16 years of experience in business management and marketing. He has worked alongside Mr. Yao at Grand Farm China since January 2008, and is responsible for assisting Mr. Yao with formulating and implementing our strategic objectives.  Mr. Li is also responsible for public relations with our private-sector and government contacts.  Mr. Li obtained a bachelor’s degree in automobile management from Fuzhou University in 1994.

Kaigang Cheng – Chief Executive Officer

Mr. Cheng served as Vice-General Manager of Grand Farm China since January 2007 and was appointed as Chief Executive Officer in July 2010.  He is primarily responsible for the execution of our growth strategies and for our overall organizational management. Before joining Grand Farm China, Mr. Cheng was Vice General Manager of Putian Hanxing Food Co., Ltd., a preserved food processing company from April 2004 to January 2007, where his primary responsibilities included corporate strategic planning and general management.  From July 2001 to March 2004, Mr. Cheng was Strategic Planning Manager of Fujian Taifu Food Co., Ltd., a canned food processing company, where he was responsible for corporate strategic planning and implementations.  From December 1999 to June 2001, Mr. Cheng was Enterprise Planning Director of Fujian Xinheilong Food Industry Co., Ltd., a canned food processing company, where he is responsible for corporate branding and marketing strategy.  From September 1996 to November 1999, Mr. Cheng was Department Manager of Guangdong Chigo Air Conditioning Co. Ltd., a Hong Kong listed air-conditioning manufacturer, where he was responsible for department level management.  None of these companies are related to or affiliated with us.  Mr. Cheng is a recipient of the Fujian Advanced Science & Technology Award in December 2006 and has two utility patents in China.  Mr. Cheng obtained his bachelor’s degree in international economics from Xi'an Jiaotong University in 1996.

Biyun Huang – Chief Financial Officer

Ms. Huang joined Grand Farm China as Accounting Director in January 2009, and was appointed as our Chief Financial Officer in October 2010.  From November 2001 to December 2008, Ms. Huang served as Senior Finance Manager of Fujian Heda Apparel Co., Ltd., an apparel company, where her responsibilities included financial reporting, financial planning and budgeting.  From August 1998 to October 2001, Ms. Huang was Chief Accountant of Putian Hengtong Economic Information Development Co., Ltd., a real estate development and trading company.  From July 1997 to July 1998, Ms. Huang was a Senior Accountant of Putian Sanzhu Oral Liquid Co., Ltd., a manufacturer of medicine and health and makeup products.  None of these companies are related to or affiliated with us.  Ms. Huang obtained her bachelor’s degree in accounting from Xiamen University in 1997.

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Kam Por Cheng – Independent Director Appointee

Mr. Cheng will serve as an independent director of our company upon the completion of this offering.  Mr. Cheng is the founder and partner of K. P. Cheng & Co., Certified Public Accountants, or KPC & Co., which he established in 1993. Operating in Hong Kong and Shanghai with approximately 100 staff members, Mr. Cheng has had 17 years of experience not only working with and auditing China-based companies but focusing on US GAAP reporting.  In 1988, he obtained a diploma in Banking & Finance from Hang Seng School of Commerce in Hong Kong.  After graduating, he worked for KPMG in Hong Kong as a trainee accountant and he became qualified as a fellow member of The Association of Chartered Certified Accountants, or ACCA, in 1991.  In 1993, he founded KPC & Co. and has been practicing as a certified public accountant in Hong Kong since then.  He holds a master degree in Executive Business Administration (EMBA) jointly organized by the Kellogg School of Management at Northwestern University and Hong Kong University of Science and Technology.  He is currently a fellow member of Hong Kong Institute of Certified Public Accountants, or HKICPA, and ACCA.

Qinglong Li – Independent Director

Dr. Li has over 40 years of industry-related experience.  He has been a professor at the Cereal Chemistry Department of Henan University of Technology since 1978, and has written three textbooks on food processing. In addition to teaching and research, Dr. Li has consulted for and advised more than 200 Chinese food companies, and has been published in more than 80 domestic scientific journals on topics including rice processing technology, grain quality analysis, and nutrient fortified rice.  He served on the State Cereal Department of Inner Mongolia as an Agriculture Section Chief between August 1968 and October 1978, where he was responsible for managing grain procurement.  He is the Director of Chinese Cereals and Oils Association, Deputy Chief and Secretary General of China National Association of Grain Flour Branch, and member of American Association of Cereal Chemists. He obtained his Bachelor’s Degree of Grain and Oil Storage from Henan University of Technology in 1968.

Feng Liang – Independent Director

Mr. Liang has over 10 years of PRC legal experience, focusing his practice on corporate mergers and acquisitions, public listing services, China foreign investment and administrative litigations.  Mr. Liang is a Senior Partner of Fujian Yuanyi Law Firm Putian Branch, a position he has held since August 2005, and has advised some of China’s biggest enterprises, including non-performing asset reorganizations for Agriculture Bank of China Putian Branch and the reorganization of Sankeshu Paint Joint-Stock Limited Company.  From August 1998 to July 2005, Mr. Liang was a lawyer at Fujian Zhongyi Law Firm advising clients on merger and acquisitions, security and debt issuance and administrative litigations.  Mr. Liang obtained his Master’s Degree in Law from Xiamen University in 1998 and obtained Certificate of the Legal Profession Qualification in the PRC in 1995.

Family Relationships

There are no family relationships between or among any of our executive officers, directors or director appointee.

Directors and Senior Management

There is no arrangement or understanding between any of our directors or officers and any other person pursuant to which any director or officer was or is to be selected as a director or officer, and there is no arrangement, plan or understanding as to whether non-management shareholders will exercise their voting rights to continue to elect the current directors to our board.  There are also no arrangements, agreements, or understandings between non-management shareholders and management under which non-management shareholders may directly or indirectly participate in or influence the management of our affairs.

Board Practices

Each of the directors named above was elected or appointed to serve until the next annual general meeting of our shareholders or until their successors have been appointed or duly elected and qualified.  Thereafter, directors will be elected for one-year terms at the annual general meeting.  None of our directors has a service contract with us or any of our subsidiaries providing for benefits upon termination of service.

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Board Committees

Our board of directors does not have any committees at this time.  Upon the completion of this offering, our board of directors will have the following committees: an Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee.  The composition and responsibilities of each committee are described below.  Board members will serve on these committees until their resignation or until otherwise determined by our board of directors.

Director Independence

Our Board of Directors anticipates that following the consummation of the offering, Kam Por Cheng, Qinglong Li and Feng Liang will qualify as “independent” directors under the rules of the NASDAQ Stock Market because they do not currently own a large percentage of Grand Farm Cayman’s issued share capital and are not expected to own a large percentage of Grand Farm Cayman’s issued share capital upon completion of this offering, are not currently employed by Grand Farm Cayman or any of its subsidiaries, have not been actively involved in the management of Grand Farm Cayman and do not fall into any of the enumerated categories of people who cannot be considered independent under the NASDAQ Stock Market Rules.  Grand Farm Cayman’s board believes that following the consummation of the offering the majority of its directors with be “independent” directors under the rules of the NASDAQ Stock Market.

Audit Committee

Upon the completion of this offering, our Audit Committee will consist of Kam Por Cheng, Qinglong Li and Feng Liang, each of whom will satisfy the independence requirements under NASDAQ Stock Market Rules and SEC rules and regulations applicable to audit committee members and have an understanding of fundamental financial statements.  Kam Por Cheng will serve as chairman of the Audit Committee.

Kam Por Cheng will qualify as an “audit committee financial expert” as that term is defined in the rules and regulations of the SEC.  The designation of Kam Por Cheng as an “audit committee financial expert” will not impose on him any duties, obligations or liability that are greater than those that are generally imposed on him as a member of our Audit Committee and our Board of Directors, and his designation as an “audit committee financial expert” pursuant to this SEC requirement will not affect the duties, obligations or liability of any other member of our Audit Committee or Board of Directors.

The Audit Committee will monitor our corporate financial statements and reporting and our external audits, including, among other things, our internal controls and audit functions, the results and scope of the annual audit and other services provided by our independent registered public accounting firm and our compliance with legal matters that have a significant impact on our financial statements.  Our Audit Committee also will consult with our management and our independent registered public accounting firm prior to the presentation of financial statements to shareholders and, as appropriate, initiate inquiries into aspects of our financial affairs.  Our Audit Committee will be responsible for establishing procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters, and for the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters, and will have established such procedures to become effective upon the effectiveness of the registration statement of which this prospectus forms a part.  In addition, our Audit Committee will be directly responsible for the appointment, retention, compensation and oversight of the work of our independent auditors, including approving services and fee arrangements.  All related party transactions will be approved by our Audit Committee before we enter into them.

Both our independent auditors and internal financial personnel will regularly meet with, and will have unrestricted access to the Audit Committee.

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Compensation Committee

Upon the completion of this offering, our Compensation Committee will consist of Kam Por Cheng, Qinglong Li and Feng Liang, each of whom will satisfy the independence requirements of NASDAQ Stock Market Rules and SEC rules and regulations.  Each member of this committee will be a non-employee director, as defined pursuant to Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as amended, and an outside director, as defined pursuant to Section 162(m) of the Internal Revenue Code of 1986, as amended. Feng Liang will serve as chairman of the Compensation Committee.

The Compensation Committee will review and approve our compensation policies and all forms of compensation to be provided to our executive officers and directors, including, among other things, annual salaries, bonuses, and other incentive compensation arrangements.  In addition, while we currently do not have any stock option plan, if and when we do, our Compensation Committee will administer such plan, including granting share options to our executive officers and directors.  Our Compensation Committee also will review and approve employment agreements with executive officers and other compensation policies and matters.

Nominating and Corporate Governance Committee

Upon the completion of this offering, our Nominating and Corporate Governance Committee will consist of Kam Por Cheng, Qinglong Li and Feng Liang, each of whom will satisfy the independence requirements of NASDAQ Stock Market Rules and SEC rules and regulations.  Kam Por Cheng will serve as chairman of the Nominating and Corporate Governance Committee.

Our Nominating and Corporate Governance Committee will identify, evaluate and recommend nominees to our Board of Directors and committees of our Board of Directors, conduct searches for appropriate directors and evaluate the performance of our Board of Directors and of individual directors.  The Nominating and Corporate Governance Committee also will be responsible for reviewing developments in corporate governance practices, evaluating the adequacy of our corporate governance practices and reporting and making recommendations to the Board of Directors concerning corporate governance matters.

Director Liability

Grand Farm Cayman’s Memorandum and Articles of Association provides that members of our board of directors and officers acting in relation to the affairs of the company shall, in the absence of actual fraud or willful neglect or default, be indemnified by the company against all losses, damages, expenses, including traveling expenses, which any such director or officer may incur or become liable by reason of any contract enterer into, or any act or thing done by him as such director or officer or in any way in or about the execution of his or her duties and the amount for which such indemnity is provided shall immediately attach as a lien on the property of the Company and have priority as between the shareholders over all other claims.

Grand Farm Cayman’s Memorandum and Articles of Association does not eliminate our director’s fiduciary duties.  However, they make it difficult or impossible for Grand Farm Cayman to successfully take legal action against a director for negligence, where such breach did not involve the director’s actual fraud or willful neglect of default.  The inclusion of the foregoing provision may, therefore, discourage or deter shareholders or management from bringing a lawsuit against directors even though such an action, if successful, might otherwise have benefited Grand Farm Cayman and our shareholders.  This provision should not affect the availability of a claim or right of action based upon a director’s actual fraud, dishonesty, willful neglect or default or breach of fiduciary duty.

Cayman Islands law provides that a company may indemnify its directors and officers as well as its other employees and agents against judgments, fines, amounts paid in settlement and expenses, including attorney’s fees, in connection with various proceedings, except where there has been actual fraud or dishonesty or willful neglect or willful default or breach of any fiduciary duty.

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Employment Agreements

Grand Farm China has entered into employment agreements with Mr. Kaigang Cheng, our chief executive officer, Ms. Biyun Huang, our chief financial officer, and Mr. Chaotang Li, our strategic development director.  Under these agreements, Mr. Cheng and Ms. Huang are each employed for a term of two years, while Mr. Li is employed for a term of four years.  Grand Farm China may terminate their employments at any time without prior written notice for certain acts, including but not limited to falsification of their records, serious violation of Grand Farm China’s policies, conviction to a crime, action leading to a loss by Grand Farm China of more than RMB 5,000, and as may be permitted by law.  Grand Farm China may terminate their employments at any time upon a 30-day written notice in certain circumstances, including but not limited to illness for which they are unable to perform their job duties or such other duties as may be assigned to them as a result of such illness, inability to adequately perform their job duties, or the elimination of their positions.  Mr. Cheng, Ms. Huang and Mr. Li may also terminate their employments with Grand Farm China upon a 30-day written notice without cause, and immediately in certain circumstances, including but not limited to a breach of their employment agreements or the law by Grand Farm China.  The employment agreements automatically terminate at the end of their respective terms unless extended.

Mr. Cheng and Ms. Huang have each also separately entered into a confidentiality and non-competition agreement with Grand Farm China.  Under such agreement, they are obligated to keep all information of Grand Farm China confidential during and after their employment terms.  Additionally, Grand Farm China has right to all intellectual property developed by them in connection with their employments, and has right of first refusal with respect to any intellectual property developed by them during, but not in connection with, their employments.   For a period of three months following the termination of their employments with Grand Farm China for any reason, Mr. Cheng and Ms. Huang may not engage in any competition against Grand Farm China without its prior written consent.

Compensation of Directors and Executive Officers

In 2010, we, our subsidiaries and Grand Farm China, our VIE, paid aggregate cash compensation of approximately $27,942 to our directors and executive officers as a group.  We did not pay any other cash compensation or benefits in kind to our directors and executive officers.

Some of our directors and executive officers own shares of our ordinary shares.  See below under the heading “Major Shareholders.”  As of the date of this prospectus, no such person has any options, warrant or other rights to acquire additional securities of Grand Farm Cayman.

We do not currently have any equity compensation plans, bonus plans or profit sharing plans for our directors, officers or employees.  We will consider employee equity compensation plan in 2011 after the completion of this offering.

MAJOR SHAREHOLDERS

The following table sets forth information with respect to the beneficial ownership, within the meaning of Rule 13d-3 under the Exchange Act, of our ordinary shares, as of the date of this prospectus for:

· each person known to us to own beneficially more than 5% of our ordinary shares;

· each of our directors and executive officers who beneficially own our ordinary shares; and

· all directors and executive officers as a group.

Beneficial ownership includes voting or investment power with respect to the securities.  Except as indicated below, and subject to applicable community property laws, the persons named in the table have or share the voting and investment power with respect to all ordinary shares shown as beneficially owned by them.  The number of our ordinary shares used in calculating the percentage for each listed person includes any options exercisable by such person within 60 days after the date of this prospectus.  Percentage of beneficial ownership of each listed person prior to this offering is based on 25,000,000 ordinary shares outstanding immediately prior to this offering.  Percentage of beneficial ownership of each listed person after this offering is based on       ordinary shares outstanding immediately after completion of this offering, and further assuming that the underwriter does not exercise its over-allotment option. The underwriter may choose to exercise the over-allotment option in full, in part or not at all.

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	Shares Beneficially Owned Prior to Offering					Shares Beneficially Owned After Offering (Excluding Exercise of Over-Allotment Option)
Executive Officers and Directors:	Number		Percent			Number	Percent
Jianshan Yao - Chairman of the Board of Director		21,196,875		84.79	%
Chaotang Li - Director and Strategic Development Director		750,000		3.00	%
Kaigang Cheng - Chief Executive Officer		—		-
Biyun Huang - Chief Financial Officer		—		-
Kam Por Cheng – Independent Director Appointee		—		-
Qinglong Li - Independent Director		—		-
Feng Liang - Independent Director		—		-
All directors and executive officers as a group (7 persons)		21,946,875		87.79	%
5% or greater Shareholders:
Sunlight Blaze Holdings Limited(1)		21,250,000		85.00	%

(1) Sunlight Blaze, a British Virgin Island company, is controlled by Jianshan Yao, the Chairman of the Board of Directors, who owns 99.75% of its equity interests.

Unless otherwise indicated, the business address of each of the individuals is No.2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, People’s Republic of China, 351111.

As of the date of this prospectus, all 25,000,000 of our outstanding ordinary shares are held by 8 record holders, none of whom is in the United States.  None of our shareholders has informed us that it is affiliated with a registered broker, or is in the business of underwriting securities.

None of our existing shareholders currently has or, after this offering, will have different voting rights from other shareholders.  We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company.

For a description of significant changes in percentage ownership held by our major shareholders during the past three years, see “Description of Shares—History of Securities Issuances.”

RELATED PARTY TRANSACTIONS

As described in “Business – Our Corporate History Structure” above, we control Grand Farm China through contractual arrangements between Grand Farm WFOE, our PRC subsidiary, and Grand Farm China and its owners. Although current PRC regulations do not restrict or prohibit foreign investment in domestic companies engaging in grain processing business such as Grand Farm China, there is substantial uncertainty regarding the interpretation and application of such regulations.  To address such uncertainty, we operate our rice processing business in China through a series of contractual arrangements with Grand Farm China, Grand Farm WFOE and the two owners of Grand Farm China, including Jianshan Yao, our Chairman, thereby avoiding the applicability of those PRC regulations governing foreign investments in domestic enterprises.  For a description of these contractual arrangements, see “Corporate Structure — Contractual Arrangements with Grand Farm China and Its Equity Owners.”

On December 30, 2010, Grand Farm WFOE entered into an agreement with Grand Farm China and its two owners, pursuant to which Grand Farm WFOE authorized Grand Farm China to declare RMB 66,200,000 ($10,000,000), or 52% of its unappropriated earnings from its inception to December 31, 2009, as dividend for distribution to its two owners pro rata to their respective ownership interests.  Grand Farm China may not, however, declare or distribute the remaining 48% of its unappropriated earnings or its unappropriated earnings for 2010 and beyond.

Some of our officers and directors are also management members of Grand Farm China:

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(1) Mr. Jianshan Yao, our Chairman, is also the founder and Chairman of Grand Farm China, and owns approximately 99.75% of equity interests of Grand Farm China, and 84.79% of our ordinary shares outstanding prior to the completion of this offering;

(2) Mr. Kaigang Cheng, our Chief Executive Officer, is also the Vice-General Manager of Grand Farm China; and

(3) Ms. Biyun Huang, our Chief Financial Officer, is also the Accounting Director of Grand Farm China.

Other Related Transactions

(a) List of related parties is as follows:

Name of related parties	Relationship
Mr. Yao	The Founder and Chairman of the Company
Mr. Jianxin Yao	Brother of Mr. Yao
Ms. Suzhen Wang (“Ms. Wang”)	Wife of Mr. Yao
Panjin Jiahong Industrial Co., Ltd. (“Panjin Jiahong”)	Entity for whom Mr. Jianxin Yao acted as legal representative prior to September 13, 2010
Putian Kaili Trading Co., Ltd.  (“Putian Kaili”)	Entity controlled by Ms. Wang and Mr. Jianxin Yao
Dawa Mingshi Food Trading Co., Ltd. (“Dawa Mingshi”)	Entity controlled by and for whom Mr. Jianxin Yao acted as legal representative prior to September 13, 2010

(b) Amounts due from related parties as of December 31, 2008, 2009 and 2010 are as follows (amounts in thousands):

	Note	December 31, 2008		December 31, 2009		December 31, 2010
Panjin Jiahong	(i)	$	10,942	$	4,371	$	-
Ms. Wang	(ii)		57		28		-
Putian Kaili	(iii)		-		1,114		-
		$	10,999	$	5,513	$	-

Note (i): The balances as of December 31, 2008 and 2009 represent advance payments to Panjin Jiahong for raw material purchases, which were unsecured, interest-free and repayable on demand. Since September 13, 2010, advance payments to Panjin Jiahong were re-classified as advances to suppliers.

Note (ii): The balances as of December 31, 2008 and 2009 represent cash advances to Ms. Wang for expenses incurred for the Company, which were unsecured, interest-free and repayable on demand.

Note (iii): The balance as of December 31, 2009 represent short-term loan made to Putian Kaili, which was unsecured, interest-free and matured within 3 months.

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(c) Amounts due to related parties as of December 31, 2008, 2009 and 2010 are as follow (amounts in thousands):

	Note	December 31, 2008		December 31, 2009		December 31, 2010
Mr. Yao	(iv)	$	-	$	-	$	808

Note (iv): The balance as of December 31, 2010 represent capital injection into Grand Farm WFOE and expenses incurred for the year paid by Mr. Yao on behalf of the Company, which was unsecured, interest-free and repayable on demand.

(d) Transactions with related parties for the years ended December 31, 2008, 2009 and 2010 are as follows (amounts in thousands):

	Note	Year ended December 31,
		2008		2009		2010
Purchases from Panjin Jiahong	(v)	$	10,756	$	4,368	$	4,489
Loans to
Putian Kaili	(vi)		-		3,250		812
Ms. Wang	(viii)		-		-		3,821
Loans from
Putian Kaili	(vi)		-		6,459		9,431
Dawa Mingshi	(vii)		-		-		7,282
Ms. Wang	(viii)		-		-		150
Maximum yearly balances of bank loans secured by related parties	(ix)	$	10,235	$	16,661	$	16,199

Note (v): Since September 13, 2010, purchases from Panjin Jiahong were not regarded as related-party transactions.

Note (vi): The Company and Putian Kaili made loans to and from each other. The loans were unsecured, interest-free and repayable within 3 months.

Note (vii): Dawa Mingshi made loans to the Company. The loans were unsecured, interest-free and repayable within 3 months.

Note (viii): The Company and Ms. Wang made loans to and from each other. The loans were unsecured, interest-free and repayable within 3 months.

Note (ix): Mr. Yao and Mr. Jianxin Yao provided guarantees for certain unsecured short-term and long-term bank loans of the Company for the years ended December 31, 2008, 2009 and 2010. Ms. Wang provided guarantees and Panjin Jiahong pledged its assets, for certain unsecured short-term and long-term bank loans of the Company for the years ended December 2008 and 2009. The maximum balances of these loans in the aggregate were $10,235, $16,661 and $16,199 for the years ended December 31, 2008, 2009 and 2010 respectively.

DESCRIPTION OF SHARE CAPITAL

The following is a summary of the material rights of the holders of our ordinary shares. These rights are set out in our memorandum and articles of association or are provided by applicable Cayman Islands law, and may differ from those typically provided to shareholders of U.S. companies under the corporation laws of some states of the United States.  For more complete information, you should read our memorandum and articles of association, which are attached as an exhibit to the registration statement filed by us on Form F-1 (of which this prospectus forms a part).  For information on how to obtain a copy of our memorandum and articles of association, see “Where You Can Find Additional Information.”

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General

We are a Cayman Islands exempted company and our affairs are governed by our memorandum and articles of association, as amended from time to time, and the Companies Law (2010 Revision) of the Cayman Islands, which is referred to below as the Companies Law.

We are authorized to issue 100,000,000 ordinary shares, par value $0.002.  As of the date of this registration statement, 25,000,000 ordinary shares are issued and outstanding, held by 8 holders of record.  All of our outstanding ordinary shares are fully paid and non-assessable.  Certificates representing the ordinary shares are issued in registered form and are evidenced by share certificates issued to each of the 8 shareholders.  Our shareholders who are non-residents of the Cayman Islands may freely hold and transfer their ordinary shares.  The Company does not have the power to issue bearer shares and ordinary shares will be non-negotiable.

Dividends

The holders of our ordinary shares are entitled to such dividends as may be declared by our board of directors out of profits or other reserves lawfully available for distribution to shareholders under the Companies Law and the laws of the Cayman Islands.

Voting Rights

Each holder of ordinary shares is entitled to one vote on all matters upon which the ordinary shares are entitled to vote.  Each holder is entitled to have one vote for each share registered in his name on the register of members.  A shareholder may participate at any meeting of shareholders either in person or by proxy.  Voting at any meeting of shareholders is by show of hands unless a poll is demanded by the chairman of our board of directors or by any shareholder present in person or by proxy.

A quorum is required for a meeting of shareholders.  Shareholders who hold at least one-third of our ordinary shares at the meeting present in person or by proxy or, if a corporation or other non-natural person, by its duly authorized representative constitutes a quorum.  Shareholders’ meetings are held annually and may be convened by our board of directors on its own initiative or upon a request to the directors by shareholders holding in the aggregate at least ten percent of our ordinary shares.  At least seven days advanced notice is required prior to convening our annual general meeting and other shareholders meetings.

An ordinary resolution of the shareholders requires the affirmative vote of a simple majority of the votes attaching to the ordinary shares cast in a general meeting to pass.  A special resolution requires the affirmative vote of not less than two-thirds of the votes cast attaching to the ordinary shares to pass.

Register of Members

The Companies Law provides that the register of members is prima facie evidence of the matters stated therein and a person will not acquire the rights of a shareholder until his or her or its name is entered in the register of members.  Holders of our ADSs will not have their names entered into our register of members as holders of share capital of the Company.  Instead, the ordinary shares underlying our ADSs will be registered in our register of members under the name of the depositary, as the holder of such ordinary shares.

Transfer of Ordinary Shares

Subject to the restrictions of our memorandum and articles of association, as set out in the following paragraph, any of our shareholders may transfer all or any of such shareholder’s ordinary shares by an instrument of transfer in the usual or common form or any other form approved by our board executed by or on behalf of the transferor and the transferee.

Our directors may, in their absolute discretion and without giving any reason, decline to register any transfer of any ordinary share to a person of whom our directors do not approve.  Our directors may also decline to register any transfer of any ordinary share unless the instrument of transfer is lodged with us, accompanied by the certificate for the ordinary shares to which it relates and such other evidence as our directors may reasonably require to show the right of the transferor to make the transfer.

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If our directors refuse to register a transfer they shall, within one month after the date on which the instrument of transfer was lodged with us, send notice of such refusal to the transferee.

Our directors may also suspend the registration of transfers during the 14 days immediately preceding the annual general meeting in each year.

Liquidation

On a return of capital in connection with the winding up of the company or otherwise (other than in connection with conversion, redemption or purchase of ordinary shares), assets available for distribution to the holders of ordinary shares shall be distributed among them on a pro rata basis.  If our assets available for distribution are insufficient to repay all of the paid-up capital, the assets will be distributed so that the losses are borne by our shareholders proportionately.

Calls on Ordinary Shares and Forfeiture of Ordinary Shares

Our board of directors may from time to time call upon shareholders for any amounts unpaid on their ordinary shares in a notice served to such shareholders at least 14 days prior to the specified time of payment.  Ordinary shares that have been called upon and remain unpaid are subject to forfeiture.

Redemption of Ordinary Shares

Subject to the provisions of the Companies Law, we may as authorized by our memorandum and articles of association to be adopted upon the completion of this offering:

· issue ordinary shares that are to be redeemed or are liable to be redeemed at our option or at the option of the shareholders, on such terms and in such manner as we may, before the issue of such ordinary shares, determine;

· purchase our own ordinary shares (including any redeemable shares) on such terms and in such manner as we may determine and agree with our shareholders; and

· make a payment in respect of the redemption or purchase of our own ordinary shares in any manner authorized by the Companies Law, including out of our capital, profits or the proceeds of a fresh issue of ordinary shares.

Variations of Rights of Shares

All or any of the special rights attached to any class of shares may, to the extent consistent with the provisions of the Companies Law, be varied either with the consent in writing of the holders of three-fourths of the issued shares of that class or with the sanction of a resolution passed by not less than three-fourths of the holders of the issued shares of that class at a separate general meeting of the holders of the shares of that class.

Inspection of Books and Records

Holders of our ordinary shares have no general right under Cayman Islands law to inspect or obtain copies of our list of shareholders or our corporate records, save for a copy of our Memorandum and Articles of Association. However, we will provide our shareholders with annual audited financial statements. See “Where You Can Find Additional Information.”

Changes in Capital

We may from time to time by ordinary resolutions, and in accordance with the provisions of the Companies Law:

· increase the share capital by such sum, to be divided into shares of such classes and amount, as the resolution shall prescribe;

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· consolidate and divide all or any of our share capital into shares of a larger amount than our existing shares;

· convert all or any of our paid up shares into shares and reconvert those shares into paid up shares of any denomination;

· sub-divide our existing shares, or any of them into shares of a smaller amount that is fixed by the memorandum and articles of association; and

· cancel any shares that, at the date of the passing of the resolution, have not been taken or agreed to be taken by any person and diminish the amount of our share capital by the amount of the shares so cancelled.

We may, by special resolution, reduce our share capital and any capital redemption reserve in any manner authorized by law.

Issuance of Additional Shares

Our memorandum and articles of association authorizes our board of directors to issue additional ordinary shares from time to time as our board of directors shall determine, to the extent there are available authorized but unissued shares.

Exempted Company

We are an exempted company with limited liability under the Companies Law.  The Companies Law distinguishes between ordinary resident companies and exempted companies.  Any company that is registered in the Cayman Islands but conducts business outside of the Cayman Islands (other than incidental business) may apply to be registered as an exempted company.  The requirements for an exempted company are essentially the same as for an ordinary company except for the exemptions and privileges listed below:

· an exempted company does not have to file an annual return of its shareholders with the Registrar of Companies;

· an exempted company’s register of members is not open to inspection;

· an exempted company does not have to hold an annual general meeting;

· an exempted company may issue negotiable or bearer shares or shares with no par value;

· an exempted company may obtain an undertaking against the imposition of any future taxation (such undertakings are usually given for 20 years in the first instance);

· an exempted company may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;

· an exempted company may register as a limited duration company; and

· an exempted company may register as a segregated portfolio company.

We believe that the differences with respect to our being a Cayman Islands exempted company as opposed to a Delaware corporation do not pose additional material risks to investors, other than the risks described under “Risk Factors — Risks Related to Our ADSs.”

Differences in Corporate Law

The Companies Law differs from laws applicable to United States corporations and their shareholders. Set forth below is a summary of the significant differences between the provisions of the Companies Law applicable to us and the laws applicable to companies incorporated in the State of Delaware in the United States and their shareholders.

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Mergers and Similar Arrangements

The Companies Law permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman Islands companies provided that the surviving entity is a Cayman Islands company.  For these purposes, (a) “merger” means the merging of two or more constituent companies and the vesting of their undertaking, property and liabilities in one of such companies as the surviving company and (b) a “consolidation” means the combination of two or more constituent companies into a consolidated company and the vesting of the undertaking, property and liabilities of such companies to the consolidated company.  In order to effect such a merger or consolidation, the directors of each constituent company must approve a written plan of merger or consolidation, which must then be authorized by either (i) a special resolution of the shareholders of each constituent company voting together as one class if the shares to be issued to each shareholder in the consolidated or surviving company will have the same rights and economic value as the shares held in the relevant constituent company or (ii) a shareholder resolution of each constituent company passed by a majority in number representing 75% in value of the shareholders voting together as one class.  The plan of merger or consolidation must be filed with the Registrar of Companies together with a declaration as to the solvency of the consolidated or surviving company, a list of the assets and liabilities of each constituent company and an undertaking that a copy of the certificate of merger or consolidation will be given to the members and creditors of each constituent company and published in the Cayman Islands Gazette.  Dissenting shareholders have the right to be paid the fair value of their shares (which, if not agreed between the parties, will be determined by the Cayman Islands court) if they follow the required procedures, subject to certain exceptions.  Court approval is not required for a merger or consolidation which is effected in compliance with these statutory procedures.

In addition, there are statutory provisions that facilitate the reconstruction and amalgamation of companies, provided that the arrangement is approved by a majority in number of each class of shareholders and creditors with whom the arrangement is to be made, and who must in addition represent three-fourths in value of each such class of shareholders or creditors, as the case may be, that are present and voting either in person or by proxy at a meeting, or meetings, convened for that purpose.  The convening of the meetings and subsequently the arrangement must be sanctioned by the Grand Court of the Cayman Islands.  While a dissenting shareholder has the right to express to the court the view that the transaction ought not be approved, the court can be expected to approve the arrangement if it determines that:

· the statutory provisions as to the dual majority vote have been met;

· the shareholders have been fairly represented at the meeting in question; and

· the arrangement is such that a businessman would reasonably approve.

If the arrangement and reconstruction is approved, the dissenting shareholder would have no rights comparable to appraisal rights, which would otherwise ordinarily be available to dissenting shareholders of United States corporations, providing rights to receive payment in cash for the judicially determined value of the shares.

In addition, there are further statutory provisions to the effect that, when a take-over offer is made and accepted by holders of 90.0% of the shares (within four months after the making of the offer), the offeror may, within a two month period, require the holders of the remaining shares to transfer such shares on the terms of the offer.  An objection can be made to the Grand Court of the Cayman Islands, but this is unlikely to succeed unless there is evidence of fraud, bad faith or collusion.

Shareholders’ Suits

We are not aware of any reported class action or derivative action having been brought in a Cayman Islands court.  Derivative actions are available in the Cayman Islands and have been permitted by the Cayman Islands court.  In principle, we will normally be the proper plaintiff and a derivative action may not be brought by a minority shareholder.  However, based on English authorities, which would in all likelihood be of persuasive authority in the Cayman Islands, there are exceptions to the foregoing principle, including when:

· a company acts or proposes to act illegally or ultra vires;

· the act complained of, although not ultra vires, could be duly effected only if authorized by a special or ordinary resolution that has not been obtained; and

· those who control the company are perpetrating a “fraud on the minority.”

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Indemnification of Directors and Executive Officers and Limitation of Liability

Cayman Islands law does not limit the extent to which a company’s memorandum and articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as a provision purporting to provide indemnification against actual fraud, willful default, or the consequences of committing a crime.  Our memorandum and articles of association provides that members of our board of directors and officers acting in relation to the affairs of the company shall, in the absence of actual fraud or willful neglect or default, be indemnified by the company against all losses, damages, expenses, including traveling expenses, which any such director or officer may incur or become liable by reason of any contract enterer into, or any act or thing done by him as such director or officer or in any way in or about the execution of his or her duties and the amount for which such indemnity is provided shall immediately attach as a lien on the property of the Company and have priority as between the shareholders over all other claims.  In addition, we have entered into indemnification agreements with our directors and senior executive officers that provide such persons with additional indemnification beyond that provided in our memorandum and articles of association.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling us under the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable as a matter of United States law.

Anti-takeover Provisions in Our Memorandum and Articles of Association

Some provisions of our memorandum and articles of association may discourage, delay or prevent a change in control of our company or management that shareholders may consider favorable, including provisions that authorize our board of directors to issue preference shares in one or more series and to designate the price, rights, preferences, privileges and restrictions of such preference shares without any further vote or action by our shareholders.

However, under Cayman Islands law, our directors may only exercise the rights and powers granted to them under our memorandum and articles of association, as amended and restated from time to time, for what they believe in good faith to be in the best interests of our company.

Directors’ Fiduciary Duties

Under Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and its shareholders.  This duty has two components: the duty of care and the duty of loyalty.  The duty of care requires that a director act in good faith, with the care that an ordinarily prudent person would exercise under similar circumstances.  Under this duty, a director must inform himself of, and disclose to shareholders, all material information reasonably available regarding a significant transaction.  The duty of loyalty requires that a director act in a manner he reasonably believes to be in the best interests of the corporation.  He must not use his corporate position for personal gain or advantage.  This duty prohibits self-dealing by a director and mandates that the best interest of the corporation and its shareholders take precedence over any interest possessed by a director, officer or controlling shareholder and not shared by the shareholders generally.  In general, actions of a director are presumed to have been made on an informed basis, in good faith and in the honest belief that the action taken was in the best interests of the corporation.  However, this presumption may be rebutted by evidence of a breach of one of the fiduciary duties.  Should such evidence be presented concerning a transaction by a director, a director must prove the procedural fairness of the transaction, and that the transaction was of fair value to the corporation.

As a matter of Cayman Islands law, a director of a Cayman Islands company is in the position of a fiduciary with respect to the company and, therefore, he owes the following duties to the company — a duty to act bona fide in the best interests of the company, a duty not to make a profit based on his position as director (unless the company permits him to do so) and a duty not to put himself in a position where the interests of the company conflict with his personal interest or his duty to a third party (unless that conflict is properly disclosed to the board of directors prior to a vote being taken, in which case the conflicted director may vote in accordance with the company’s Memorandum and Articles of Association).  A director of a Cayman Islands company owes to the company a duty to act with skill and care.  These duties have been previously defined as a requirement to act as a reasonably diligent person having both: (a) the general knowledge, skill and experience that may reasonably be expected of a person carrying out the same functions as are carried out by that director in relation to the company, and (b) the general knowledge, skill and experience which that particular director has. However, English and British Commonwealth courts have moved towards an objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands.

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Shareholder Action by Written Consent

Under the Delaware General Corporation Law, a corporation may eliminate the right of shareholders to act by written consent through amendment to its certificate of incorporation.  Cayman Islands law and our memorandum and articles of association provide that shareholders may approve corporate matters by way of a unanimous written resolution signed by or on behalf of each shareholder who would have been entitled to vote on such matter at a general meeting without a meeting being held.

Shareholder Proposals

Under the Delaware General Corporation Law, a shareholder has the right to put any proposal before the shareholders at the annual meeting, provided that such shareholder complies with the notice provisions in the governing documents.  Under the laws of the Cayman Islands, a shareholder can only put a proposal before the shareholders at any meeting if it is set out in the notice calling the meeting.  There is no right to introduce new business at any meeting.  A special meeting may be called by the board of directors or any other person authorized to do so in the governing documents, but shareholders may be precluded from calling special meetings.

Cayman Islands law and our memorandum and articles of association allow our shareholders holding not less than 10.0% of the paid up voting share capital of the Company to require the Company to call a shareholder’s meeting.  As an exempted Cayman Islands company, we are not obliged by law to call shareholders’ annual general meetings.  However, our memorandum and articles of association require us to call such meetings unless the shareholders by ordinary resolution determine that no annual general meeting is to be held in a particular year or years or indefinitely.

Cumulative Voting

Under the Delaware General Corporation Law, cumulative voting for elections of directors is not permitted unless the corporation’s certificate of incorporation specifically provides for it.  Cumulative voting potentially facilitates the representation of minority shareholders on a board of directors since it permits a minority shareholder to cast all the votes to which such shareholder is entitled on a single director, which increases such shareholder’s voting power with respect to electing such director.  There are no prohibitions in relation to cumulative voting under the laws of the Cayman Islands, but our memorandum and articles of association do not provide for cumulative voting.  As a result, our shareholders are not afforded any less protections or rights on this issue than shareholders of a Delaware corporation.

Removal of Directors

Under the Delaware General Corporation Law, a director of a corporation with a classified board may be removed only for cause with the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise.  Under our memorandum and articles of association, directors can be removed without cause, but only by the vote of holders of a simple majority of our shares, cast at a general meeting, or by the unanimous written resolution of all shareholders.

Transactions with Interested Shareholders

The Delaware General Corporation Law contains a business combination statute applicable to Delaware public corporations whereby, unless the corporation has specifically elected not to be governed by such statute by amendment to its certificate of incorporation, it is prohibited from engaging in certain business combinations with an “interested shareholder” for three years following the date that such person becomes an interested shareholder. An interested shareholder generally is a person or a group who or which owns or has owned 15.0% or more of the target’s outstanding voting shares within the past three years.  This has the effect of limiting the ability of a potential acquirer to make a two-tiered bid for the target in which all shareholders would not be treated equally.  The statute does not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder, the board of directors approves either the business combination or the transaction which resulted in the person becoming an interested shareholder.  This encourages any potential acquirer of a Delaware public corporation to negotiate the terms of any acquisition transaction with the target’s board of directors.

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Cayman Islands law has no comparable statute.  As a result, we cannot avail ourselves of the types of protections afforded by the Delaware business combination statute.  However, although Cayman Islands law does not regulate transactions between a company and its significant shareholders, it does provide that such transactions must be entered into bona fide in the best interests of the company and not with the effect of constituting a fraud on the minority shareholders.

Dissolution; Winding up

Under the Delaware General Corporation Law, unless the board of directors approves the proposal to dissolve, dissolution must be approved by shareholders holding 100% of the total voting power of the corporation.  Only if the dissolution is initiated by the board of directors may it be approved by a simple majority of the corporation’s outstanding shares.  Delaware law allows a Delaware corporation to include in its certificate of incorporation a supermajority voting requirement in connection with dissolutions initiated by the board.  Under the Companies Law of the Cayman Islands and our memorandum and articles of association, our company may be, liquidated or wound up and subsequently dissolved by the vote of holders of two-thirds of our shares voting at a meeting or the unanimous written resolution of all shareholders or by an ordinary resolution on the basis that we are unable to pay our debts as they fall due.

Variation of Rights of Shares

Under the Delaware General Corporation Law, a corporation may vary the rights of a class of shares with the approval of a majority of the outstanding shares of such class, unless the certificate of incorporation provides otherwise.  Under our memorandum and articles of association, if our share capital is divided into more than one class of shares, we may vary the rights attached to any class only with the vote at a separate class meeting of holders of three-fourths of the shares of such class or unanimous written resolution of all shareholders of that class.

Amendment of Governing Documents

Under the Delaware General Corporation Law, a corporation’s governing documents may be amended with the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise.  As permitted by Cayman Islands law, except for certain amendments to the capital structure not affecting a shareholder’s economic rights, our memorandum and articles of association may only be amended with a special resolution at a meeting or the unanimous written resolution of all voting shareholders. In the case of amendments to the memorandum of association not affecting a shareholders’ economic rights these may be passed by a simple majority at a meeting or the unanimous written resolution of all voting shareholders.

Rights of Non-resident or Foreign Shareholders

There are no limitations imposed by our memorandum and articles of association on the rights of non-resident or foreign shareholders to hold or exercise voting rights on our shares.  In addition, there are no provisions in our restated memorandum and articles of association governing the ownership threshold above which shareholder ownership must be disclosed.

History of Securities Issuances

The following is a summary of our securities issuances since our inception in June 2010.

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Grand Farm Cayman was incorporated in the Cayman Islands on June 30, 2010.  Our authorized share capital was initially set at $50,000, consisting of 50,000 ordinary shares with a par value of $1.00 per share.  Of these total number of shares, 42,500 shares were issued to Sunlight Blaze Holdings Limited for which Jiansan Yao, our Chairman of the Board of Director, is the controlling shareholder; 1,500 shares were issued to Mascot Sun Limited for which Chaotang Li, our Strategic Development Director as well as a director on our board, is the sole shareholder; and the remaining 6,000 shares were issued to six other shareholders, none of whom are employed by us.

Pursuant to a board resolution and a shareholders’ resolution dated October 1, 2010, we carried out a 500-for-1 forward share split and an increase in authorized capital to $200,000 consisting of 100,000,000 ordinary shares having a par value of $0.002 per share. As a result, the number of authorized shares increased from 50,000 to 100,000,000 with par value changing from $1 per share to $0.002 per share, and the number of issued and outstanding shares changed from 50,000 shares with a par value of $1 per share to 25,000,000 shares with a par value of $0.002 per share.

At the time of the issuances of these securities, Grand Farm Cayman was not a reporting company in the United States.  The offer and sale of these securities was to non-US persons outside of the United States, therefore, these securities were exempt from registration.

DESCRIPTION OF AMERICAN DEPOSITARY SHARES

American Depositary Shares

Deutsche Bank Trust Company Americas, as depositary, will register and deliver the ADSs.  Each ADS will represent ownership of       ordinary shares deposited with the office in Hong Kong of Deutsche Bank AG, Hong Kong Branch, as custodian for the depositary.  Each ADS will also represent ownership of any other securities, cash or other property which may be held by the depositary.  The depositary’s corporate trust office at which the ADSs will be administered is located at 60 Wall Street, New York, NY 10005, USA.  The principal executive office of the depositary is located at 60 Wall Street, New York, NY 10005, USA.

The Direct Registration System, or DRS, is a system administered by The Depository Trust Company, or DTC, pursuant to which the depositary may register the ownership of uncertificated ADSs, which ownership shall be evidenced by periodic statements issued by the depositary to the ADS holders entitled thereto.

We will not treat ADS holders as our shareholders and accordingly, you, as an ADS holder, will not have shareholder rights.  Cayman Islands law governs shareholder rights.  The depositary will be the holder of the ordinary shares underlying your ADSs.  As a holder of ADSs, you will have ADS holder rights.  A deposit agreement among us, the depositary and you, as an ADS holder, and the beneficial owners of ADSs sets out ADS holder rights as well as the rights and obligations of the depositary.  The laws of the State of New York govern the deposit agreement and the ADSs.

The following is a summary of the material provisions of the deposit agreement.  For more complete information, you should read the entire deposit agreement and the form of American depositary receipt.  For directions on how to obtain copies of those documents, see “Where You Can Find Additional Information.”

Holding the ADSs

How will you hold your ADSs?

You may hold ADSs either (1) directly (a) by having an American depositary receipt, or ADR, which is a certificate evidencing a specific number of ADSs, registered in your name, or (b) by holding ADSs in the DRS, or (2) indirectly through your broker or other financial institution.  If you hold ADSs directly, you are an ADS holder.  This description assumes you hold your ADSs directly.  If you hold the ADSs indirectly, you must rely on the procedures of your broker or other financial institution to assert the rights of ADS holders described in this section.  You should consult with your broker or financial institution to find out what those procedures are.

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Dividends and Other Distributions

How will you receive dividends and other distributions on the shares?

The depositary has agreed to pay to you the cash dividends or other distributions it or the custodian receives on ordinary shares or other deposited securities, after deducting its fees and expenses.  You will receive these distributions in proportion to the number of ordinary shares your ADSs represent as of the record date (which will be as close as practicable to the record date for our ordinary shares) set by the depositary with respect to the ADSs.

· Cash.  The depositary will convert any cash dividend or other cash distribution we pay on the ordinary shares or any net proceeds from the sale of any ordinary shares, rights, securities or other entitlements into U.S. dollars if it can do so on a reasonable basis, and can transfer the U.S. dollars to the United States.  If that is not possible or lawful or if any government approval is needed and cannot be obtained, the deposit agreement allows the depositary to distribute the foreign currency only to those ADS holders to whom it is possible to do so.  It will hold the foreign currency it cannot convert for the account of the ADS holders who have not been paid, and such funds will be held in a segregated account.  It will not invest the foreign currency, and it will not be liable for any interest.

Before making a distribution, any taxes or other governmental charges, together with fees and expenses of the depositary, that must be paid, will be deducted.  It will distribute only whole U.S. dollars and cents and will round fractional cents to the nearest whole cent.  If the exchange rates fluctuate during a time when the depositary cannot convert the foreign currency, you may lose some or all of the value of the distribution.

· Shares.  The depositary may distribute additional ADSs representing any ordinary shares we distribute as a dividend or free distribution to the extent reasonably practicable and permissible under law.  The depositary will only distribute whole ADSs.  It will try to sell ordinary shares which would require it to deliver a fractional ADS and distribute the net proceeds in the same way as it does with cash.  If the depositary does not distribute additional ADSs, the outstanding ADSs will also represent the new ordinary shares.  The depositary may sell a portion of the distributed ordinary shares sufficient to pay its fees and expenses in connection with that distribution.

· Elective Distributions in Cash or Shares.  If we offer holders of our ordinary shares the option to receive dividends in either cash or shares, the depositary, after consultation with us and having received timely notice as described in the deposit agreement of such elective distribution by us, has discretion to determine to what extent such elective distribution will be made available to you as a holder of the ADSs.  We must first instruct the depositary to make such elective distribution available to you and furnish it with satisfactory evidence that it is legal to do so.  The depositary could decide it is not legal or reasonably practical to make such elective distribution available to you, or it could decide that it is only legal or reasonably practical to make such elective distribution available to some but not all holders of the ADSs.  In such case, the depositary shall, on the basis of the same determination as is made in respect of the ordinary shares for which no election is made, distribute either cash in the same way as it does in a cash distribution, or additional ADSs representing ordinary shares in the same way as it does in a share distribution.  The depositary is not obligated to make available to you a method to receive the elective dividend in shares rather than in ADSs.  There can be no assurance that you will be given the opportunity to receive elective distributions on the same terms and conditions as the holders of ordinary shares.

· Rights to Purchase Additional Shares.  If we offer holders of our ordinary shares any rights to subscribe for additional shares or any other rights, the depositary may after consultation with us and having received timely notice as described in the deposit agreement of such distribution by us, make these rights available to you.  We must first instruct the depositary to make such rights available to you and furnish the depositary with satisfactory evidence that it is legal to do so.  If the depositary decides it is not legal and practical to make the rights available but that it is practical to sell the rights, the depositary will use reasonable efforts to sell the rights and distribute the net proceeds in the same way as it does with cash.  The depositary will allow rights that are not distributed or sold to lapse.  In that case, you will receive no value for them.

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If the depositary makes rights available to you, it will exercise the rights and purchase the shares on your behalf.  The depositary will then deposit the shares and deliver ADSs to you.  It will only exercise rights if you pay it the exercise price and any other charges the rights require you to pay.

U.S. securities laws may restrict transfers and cancellation of the ADSs represented by shares purchased upon exercise of rights.  For example, you may not be able to trade these ADSs freely in the United States.  In this case, the depositary may deliver restricted depositary shares that have the same terms as the ADSs described in this section except for changes needed to put the necessary restrictions in place.

· Other Distributions.  Subject to receipt of timely notice, as described in the deposit agreement, from us with the request to make any such distribution available to you, and provided the depositary has determined such distribution is lawful and reasonably practicable and feasible and in accordance with the terms of the deposit agreement, the depositary will send to you anything else we distribute on deposited securities by any means it thinks is legal, fair and practical.  If it cannot make the distribution in that way, the depositary has a choice:  it may decide to sell what we distributed and distribute the net proceeds in the same way as it does with cash; or, it may decide to hold what we distributed, in which case ADSs will also represent the newly distributed property.  However, the depositary is not required to distribute any securities (other than ADSs) to you unless it receives satisfactory evidence from us that it is legal to make that distribution.  The depositary may sell a portion of the distributed securities or property sufficient to pay its fees and expenses in connection with that distribution.

The depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any ADS holders.  We have no obligation to register ADSs, shares, rights or other securities under the Securities Act.  We also have no obligation to take any other action to permit the distribution of ADSs, shares, rights or anything else to ADS holders.  This means that you may not receive the distributions we make on our shares or any value for them if it is illegal or impractical for us to make them available to you.

Deposit, Withdrawal and Cancellation

How are ADSs issued?

The depositary will deliver ADSs if you or your broker deposit ordinary shares or evidence of rights to receive ordinary shares with the custodian.  Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, the depositary will register the appropriate number of ADSs in the names you request and will deliver the ADSs to or upon the order of the person or persons entitled thereto.

Except for ordinary shares deposited by us in connection with this offering, no shares will be accepted for deposit during a period of 12 months after the date of this prospectus.  The 12-month lock-up period is subject to adjustment under certain circumstances as described in the section entitled “Shares Eligible for Future Sale — Lock-up Agreements.”

How do ADS holders cancel an American Depositary Share?

You may turn in your ADSs at the depositary’s corporate trust office or by providing appropriate instructions to your broker.  Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, the depositary will deliver the ordinary shares and any other deposited securities underlying the ADSs to you or a person you designate at the office of the custodian.  Or, at your request, risk and expense, the depositary will deliver the deposited securities at its corporate trust office, if feasible.

How do ADS holders interchange between Certificated ADSs and Uncertificated ADSs?

You may surrender your ADR to the depositary for the purpose of exchanging your ADR for uncertificated ADSs.  The depositary will cancel that ADR and will send you a statement confirming that you are the owner of uncertificated ADSs.  Alternatively, upon receipt by the depositary of a proper instruction from a holder of uncertificated ADSs requesting the exchange of uncertificated ADSs for certificated ADSs, the depositary will execute and deliver to you an ADR evidencing those ADSs.

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Voting Rights

How do you vote?

You may instruct the depositary to vote the ordinary shares or other deposited securities underlying your ADSs.  Otherwise, you could exercise your right to vote directly if you withdraw the ordinary shares.  However, you may not know about the meeting sufficiently enough in advance to withdraw the ordinary shares.

If we ask for your instructions and upon timely notice from us as described in the deposit agreement, the depositary will notify you of the upcoming vote and arrange to deliver our voting materials to you.  The materials will (1) describe the matters to be voted on and (2) explain how you may instruct the depositary to vote the ordinary shares or other deposited securities underlying your ADSs as you direct, including an express indication that such instruction may be given or deemed given in accordance with the second to last sentence of this paragraph if no instruction is received, to the depositary to give a discretionary proxy to a person designated by us.  For instructions to be valid, the depositary must receive them on or before the date specified.  The depositary will try, as far as practical, subject to the laws of the Cayman Islands and the provisions of our memorandum and articles of association, to vote or to have its agents vote the ordinary shares or other deposited securities as you instruct.  The depositary will only vote or attempt to vote as you instruct.  If we timely requested the depositary to solicit your instructions but no instructions are received by the depositary from an owner with respect to any of the deposited securities represented by the ADSs of that owner on or before the date established by the depositary for such purpose, the depositary shall deem that owner to have instructed the depositary to give a discretionary proxy to a person designated by us with respect to such deposited securities, and the depositary shall give a discretionary proxy to a person designated by us to vote such deposited securities.  However, no such instruction shall be deemed given and no such discretionary proxy shall be given with respect to any matter if we inform the depositary we do not wish such proxy given, substantial opposition exists or the matter materially and adversely affects the rights of holders of the ordinary shares.

We cannot assure you that you will receive the voting materials in time to ensure that you can instruct the depositary to vote the ordinary shares underlying your ADSs.  In addition, the depositary and its agents are not responsible for failing to carry out voting instructions or for the manner of carrying out voting instructions.  This means that you may not be able to exercise your right to vote and you may have no recourse if the ordinary shares underlying your ADSs are not voted as you requested.

In order to give you a reasonable opportunity to instruct the depositary as to the exercise of voting rights relating to deposited securities, if we request the depositary to act, we will try to give the depositary notice of any such meeting and details concerning the matters to be voted upon more than       business days in advance of the meeting date.

Fees and Expenses

As an ADS holder, you will be required to pay the following service fees to the depositary bank:

Service		Fees
●	Issuance of ADSs, including issuances resulting from a distribution of shares or rights or other property	Up to US$0.05 per ADS issued
●	Cancellation of ADSs, including the case of termination of the deposit agreement	Up to US$0.05 per ADS cancelled
●	Distribution of cash dividends or other cash distributions	Up to US$0.05 per ADS held
●	Distribution of ADSs pursuant to share dividends, free share distributions or exercise of rights.	Up to US$0.05 per ADS held
●	Distribution of securities other than ADSs or rights to purchase additional ADSs	A fee equivalent to the fee that would be payable if securities distributed to you had been ordinary shares and the ordinary shares had been deposited for issuance of ADSs

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●	Depositary services	Up to US$0.05 per ADS held on the applicable record date(s) established by the depositary bank
●	Transfer of ADRs	U.S. $1.50 per certificate presented for transfer

As an ADS holder, you will also be responsible to pay certain fees and expenses incurred by the depositary bank and certain taxes and governmental charges such as:

• Fees for the transfer and registration of ordinary shares charged by the registrar and transfer agent for the ordinary shares in the Cayman Islands (i.e., upon deposit and withdrawal of ordinary shares).

• Expenses incurred for converting foreign currency into U.S. dollars.

• Expenses for cable, telex and fax transmissions and for delivery of securities.

• Taxes and duties upon the transfer of securities, including any applicable stamp duties, any stock transfer charges or withholding taxes (i.e., when ordinary shares are deposited or withdrawn from deposit).

• Fees and expenses incurred in connection with the delivery or servicing of ordinary shares on deposit.

• Fees and expenses incurred in connection with complying with exchange control regulations and other regulatory requirements applicable to ordinary shares, deposited securities, ADSs and ADRs.

• Any applicable fees and penalties thereon.

The depositary fees payable upon the issuance and cancellation of ADSs are typically paid to the depositary bank by the brokers (on behalf of their clients) receiving the newly issued ADSs from the depositary bank and by the brokers (on behalf of their clients) delivering the ADSs to the depositary bank for cancellation. The brokers in turn charge these fees to their clients. Depositary fees payable in connection with distributions of cash or securities to ADS holders and the depositary services fee are charged by the depositary bank to the holders of record of ADSs as of the applicable ADS record date.

The depositary fees payable for cash distributions are generally deducted from the cash being distributed or by selling a portion of distributable property to pay the fees. In the case of distributions other than cash (i.e., share dividends, rights), the depositary bank charges the applicable fee to the ADS record date holders concurrent with the distribution. In the case of ADSs registered in the name of the investor (whether certificated or uncertificated in direct registration), the depositary bank sends invoices to the applicable record date ADS holders. In the case of ADSs held in brokerage and custodian accounts (via DTC), the depositary bank generally collects its fees through the systems provided by DTC (whose nominee is the registered holder of the ADSs held in DTC) from the brokers and custodians holding ADSs in their DTC accounts. The brokers and custodians who hold their clients’ ADSs in DTC accounts in turn charge their clients’ accounts the amount of the fees paid to the depositary banks.

In the event of refusal to pay the depositary fees, the depositary bank may, under the terms of the deposit agreement, refuse the requested service until payment is received or may set off the amount of the depositary fees from any distribution to be made to the ADS holder.  Non-payment of fees and expenses with respect to ADSs generally does not result in forfeiture of the ADSs or the ordinary shares represented by such ADSs, although the depositary bank may, under the terms of the deposit agreement, sell the ordinary shares to satisfy tax claims.

Deutsche Bank Trust Company Americas, as depositary, has agreed to reimburse us for a portion of certain expenses we incur that are related to establishment and maintenance of the ADR program, including investor relations expenses.  There are limits on the amount of expenses for which the depositary will reimburse us, but the amount of reimbursement available to us is not related to the amounts of fees the depositary collects from investors.  Further, the depositary has agreed to reimburse us certain fees payable to the depositary by holders of ADSs.  Neither the depositary nor we can determine the exact amount to be made available to us because (i) the number of ADSs that will be issued and outstanding, (ii) the level of service fees to be charged to holders of ADSs and (iii) our reimbursable expenses related to the program are not known at this time.

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Payment of Taxes

You will be responsible for any taxes or other governmental charges payable on your ADSs or on the deposited securities represented by any of your ADSs.  The depositary may refuse to register any transfer of your ADSs or allow you to withdraw the deposited securities represented by your ADSs until such taxes or other charges are paid.  It may apply payments owed to you or sell deposited securities represented by your ADSs to pay any taxes owed and you will remain liable for any deficiency.  If the depositary sells deposited securities, it will, if appropriate, reduce the number of ADSs to reflect the sale and pay to you any net proceeds, or send to you any property, remaining after it has paid the taxes.  You agree to indemnify us, the depositary, the custodian and each of our and their respective agents, directors, employees and affiliates for, and hold each of them harmless from, any claims with respect to taxes (including applicable interest and penalties thereon) arising from any tax benefit obtained for you.

Reclassifications, Recapitalizations and Mergers

If we:	Then:
Change the nominal or par value of our ordinary shares	The cash, shares or other securities received by the depositary will become deposited securities.
Reclassify, split up or consolidate any of the deposited securities	Each ADS will automatically represent its equal share of the new deposited securities.
Distribute securities on the ordinary shares that are not distributed to you or Recapitalize, reorganize, merge, liquidate, sell all or substantially all of our assets, or take any similar action	The depositary may distribute some or all of the cash, shares or other securities it received.  It may also deliver new ADSs or ask you to surrender your outstanding ADRs in exchange for new ADRs identifying the new deposited securities.

Amendment and Termination

How may the deposit agreement be amended?

We may agree with the depositary to amend the deposit agreement and the form of ADR without your consent for any reason.  If an amendment adds or increases fees or charges, except for taxes and other governmental charges or expenses of the depositary for registration fees, facsimile costs, delivery charges or similar items, including expenses incurred in connection with foreign exchange control regulations and other charges specifically payable by ADS holders under the deposit agreement, or materially prejudices a substantial existing right of ADS holders, it will not become effective for outstanding ADSs until 30 days after the depositary notifies ADS holders of the amendment.  At the time an amendment becomes effective, you are considered, by continuing to hold your ADSs, to agree to the amendment and to be bound by the ADRs and the deposit agreement as amended.

How may the deposit agreement be terminated?

The depositary will terminate the deposit agreement if we ask it to do so, in which case the depositary will give notice to you at least 90 days prior to termination.  The depositary may also terminate the deposit agreement if the depositary has told us that it would like to resign and we have not appointed a new depositary within 90 days.  In such case, the depositary must notify you at least 30 days before termination.

After termination, the depositary and its agents will do the following under the deposit agreement but nothing else: collect distributions on the deposited securities, sell rights and other property and deliver ordinary shares and other deposited securities upon cancellation of ADSs after payment of any fees, charges, taxes or other governmental charges.  Six months or more after termination, the depositary may sell any remaining deposited securities by public or private sale.  After that, the depositary will hold the money it received on the sale, as well as any other cash it is holding under the deposit agreement, for the pro rata benefit of the ADS holders that have not surrendered their ADSs.  It will not invest the money and has no liability for interest.  The depositary’s only obligations will be to account for the money and other cash.  After termination, our only obligations will be to indemnify the depositary and to pay fees and expenses of the depositary that we agreed to pay.

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Books of Depositary

The depositary will maintain ADS holder records at its depositary office.  You may inspect such records at such office during regular business hours but solely for the purpose of communicating with other holders in the interest of business matters relating to the ADSs and the deposit agreement.

The depositary will maintain facilities in New York to record and process the issuance, cancellation, combination, split-up and transfer of ADRs.

These facilities may be closed from time to time, to the extent not prohibited by law or if any such action is deemed necessary or advisable by the depositary or us, in good faith, at any time or from time to time because of any requirement of law, any government or governmental body or commission or any securities exchange on which the ADRs or ADSs are listed, or under any provision of the deposit agreement or provisions of, or governing, the deposited securities, or any meeting of our shareholders or for any other reason.

Limitations on Obligations and Liability

Limits on our Obligations and the Obligations of the Depositary; Limits on Liability to Holders of ADSs

The deposit agreement expressly limits our obligations and the obligations of the depositary.  It also limits our liability and the liability of the depositary.  We and the depositary:

· are only obligated to take the actions specifically set forth in the deposit agreement without gross negligence or willful misconduct;

· are not liable if either of us is prevented or delayed by law or circumstances beyond our control from performing our obligations under the deposit agreement, including, without limitation, requirements of any present or future law, regulation, governmental or regulatory authority or share exchange of any applicable jurisdiction, any present or future provisions of our memorandum and articles of association, on account of possible civil or criminal penalties or restraint, any provisions of or governing the deposited securities or any act of God, war or other circumstances beyond our control as set forth in the deposit agreement;

· are not liable if either of us exercises, or fails to exercise, discretion permitted under the deposit agreement;

· are not liable for the inability of any holder of ADSs to benefit from any distribution on deposited securities that is not made available to holders of ADSs under the terms of the deposit agreement, or for any indirect, special, consequential or punitive damages for any breach of the terms of the deposit agreement;

· have no obligation to become involved in a lawsuit or other proceeding related to the ADSs or the deposit agreement on your behalf or on behalf of any other party;

· may rely upon any documents we believe in good faith to be genuine and to have been signed or presented by the proper party;

· disclaim any liability for any action/inaction in reliance on the advice or information of legal counsel, accountants, any person presenting  ordinary shares for deposit, holders and beneficial owners (or authorized representatives) of ADSs, or any person believed in good faith to be competent to give such advice or information;

· disclaim any liability for inability of any holder to benefit from any distribution, offering, right or other benefit made available to holders of deposited securities but not made available to holders of ADSs; and

· disclaim any liability for any indirect, special, punitive or consequential damages.

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           The depositary and any of its agents also disclaim any liability for any failure to carry out any instructions to vote, the manner in which any vote is cast or the effect of any vote or failure to determine that any distribution or action may be lawful or reasonably practicable or for allowing any rights to lapse in accordance with the provisions of the deposit agreement, the failure or timeliness of any notice from us, the content of any information submitted to it by us for distribution to you or for any inaccuracy of any translation thereof, any investment risk associated with the acquisition of an interest in the deposited securities, the validity or worth of the deposited securities, the credit-worthiness of any third party, or for any tax consequences that may result from ownership of ADSs,  ordinary shares or deposited securities.

In the deposit agreement, we and the depositary agree to indemnify each other under certain circumstances.

Requirements for Depositary Actions

Before the depositary will issue, deliver or register a transfer of an ADS, make a distribution on an ADS, or permit withdrawal of ordinary shares, the depositary may require:

· payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of any ordinary shares or other deposited securities and payment of the applicable fees, expenses and charges of the depositary;

· satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and

· compliance with regulations it may establish, from time to time, consistent with the deposit agreement, including presentation of transfer documents.

The depositary may refuse to issue and deliver ADSs or register transfers of ADSs generally when the register of the depositary or our transfer books are closed or at any time if the depositary or we think it is necessary or advisable to do so.

Your Right to Receive the Shares Underlying Your ADSs

You have the right to cancel your ADSs and withdraw the underlying ordinary shares at any time except:

· when temporary delays arise because:  (1) the depositary has closed its transfer books or we have closed our transfer books; (2) the transfer of ordinary shares is blocked to permit voting at a shareholders’ meeting; or (3) we are paying a dividend on our ordinary shares;

· when you owe money to pay fees, taxes and similar charges; or

· when it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to ADSs or to the withdrawal of ordinary shares or other deposited securities.

This right of withdrawal may not be limited by any other provision of the deposit agreement.

Pre-release of ADSs

The deposit agreement permits the depositary to deliver ADSs before deposit of the underlying ordinary shares.  This is called a pre-release of the ADSs.  The depositary may also deliver ordinary shares upon cancellation of pre-released ADSs (even if the ADSs are cancelled before the pre-release transaction has been closed out).  A pre-release is closed out as soon as the underlying ordinary shares are delivered to the depositary.  The depositary may receive ADSs instead of ordinary shares to close out a pre-release.  The depositary may pre-release ADSs only under the following conditions:  (1) before or at the time of the pre-release, the person to whom the pre-release is being made represents to the depositary in writing that it or its customer (a) owns the ordinary shares or ADSs to be deposited, (b) assigns all beneficial rights, title and interest in such ordinary shares or ADSs to the depositary for the benefit of the owners, (c) will not take any action with respect to such ordinary shares or ADSs that is inconsistent with the transfer of beneficial ownership, (d) indicates the depositary as owner of such ordinary shares or ADSs in its records, and (e) unconditionally guarantees to deliver such ordinary shares or ADSs to the depositary or the custodian, as the case may be; (2) the pre-release is fully collateralized with cash or other collateral that the depositary considers appropriate; and (3) the depositary must be able to close out the pre-release on not more than five business days’ notice.  Each pre-release is subject to further indemnities and credit regulations as the depositary considers appropriate.  In addition, the depositary will limit the number of ADSs that may be outstanding at any time as a result of pre-releaseto 30% of the aggregate number of ADSs then outstanding, although the depositary may disregard the limit from time to time, if it thinks it is appropriate to do so, including (1) due to a decrease in the aggregate number of ADSs outstanding that causes existing pre-release transactions to temporarily exceed the limit stated above or (2) where otherwise required by market conditions.

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Direct Registration System

In the deposit agreement, all parties to the deposit agreement acknowledge that the DRS and Profile Modification System, or Profile, will apply to uncertificated ADSs upon acceptance thereof to DRS by DTC.  DRS is the system administered by DTC pursuant to which the depositary may register the ownership of uncertificated ADSs, which ownership shall be evidenced by periodic statements issued by the depositary to the ADS holders entitled thereto.  Profile is a required feature of DRS which allows a DTC participant, claiming to act on behalf of an ADS holder, to direct the depositary to register a transfer of those ADSs to DTC or its nominee and to deliver those ADSs to the DTC account of that DTC participant without receipt by the depositary of prior authorization from the ADS holder to register such transfer.

In connection with and in accordance with the arrangements and procedures relating to DRS/Profile, the parties to the deposit agreement understand that the depositary will not verify, determine or otherwise ascertain that the DTC participant which is claiming to be acting on behalf of an ADS holder in requesting registration of transfer and delivery described in the paragraph above has the actual authority to act on behalf of the ADS holder (notwithstanding any requirements under the Uniform Commercial Code).  In the deposit agreement, the parties agree that the depositary’s reliance on, and compliance with, instructions received by the depositary through the DRS/Profile System and in accordance with the deposit agreement, shall not constitute negligence or bad faith on the part of the depositary.

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of this offering, we will have       ADSs outstanding representing approximately           % of our issued and outstanding ordinary shares, assuming no exercise of the underwriter’s over-allotment option.  All of the ADSs sold in this offering and the ordinary shares they represent will be freely transferable by persons other than our “affiliates” without restriction or further registration under the Securities Act.  Sales or perceived sales of substantial amounts of additional ADSs in the public market after this offering could adversely affect prevailing market prices of our ADSs.  Prior to this offering, there has been no public market for our ADSs or ordinary shares anywhere, and while we have submitted an application for our ADSs to be listed on the NASDAQ Capital Market, we cannot assure you that our application will be approved or that a regular trading market will develop or be sustained in our ADSs after this offering.  We do not expect that a trading market will develop for our ordinary shares not represented by the ADSs.

Ordinary shares purchased by one of our “affiliates” may not be resold in the United States, except pursuant to an effective registration statement or an exemption from registration, including an exemption under Rule 144 of the Securities Act described below.  All of the ordinary shares held by existing shareholders are “restricted securities,” as that term is defined in Rule 144 of the Securities Act, as are the ADSs issued from exercise of the underwriter’s warrants after this prospectus is no longer effective.  These restricted securities may be sold in the United States only if they are registered or if they qualify for an exemption from registration under Rule 144 or Rule 701 of the Securities Act. These rules are described below.

Lock-up Agreements

Our directors and officers have agreed that, for a period of 12 months from the closing of this offering, they will not sell, contract to sell, grant any option for the sale or otherwise dispose of any of our equity securities, or any securities convertible into or exercisable or exchangeable for our equity securities, without the consent of the underwriter, including for exercise or conversion of currently outstanding warrants, options and convertible debentures, as applicable.

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Rule 144

In general, under Rule 144, a person (or persons whose shares are aggregated) who is not deemed to have been an affiliate of ours at any time during the three months preceding a sale, and who has beneficially owned restricted securities within the meaning of Rule 144 for at least six months (including any period of consecutive ownership of preceding non-affiliated holders) would be entitled to sell those shares, subject only to the availability of current public information about us.  A non-affiliated person who has beneficially owned restricted securities within the meaning of Rule 144 for at least one year would be entitled to sell those shares without regard to the provisions of Rule 144.

In general, under Rule 144, our affiliates or persons selling shares on behalf of our affiliates are entitled to sell (upon expiration of the lock-up agreements described above as applicable) a number of shares that does not exceed the greater of:

· 1% of the number of our ordinary shares then outstanding, in the form of ADSs or otherwise, which will equal approximately       shares immediately after this offering; and

· the average weekly trading volume of our ordinary shares, in the form of ADSs or otherwise, on the exchange on which we are listed at the time during the four calendar weeks preceding the date on which notice of the sale is filed with the SEC.

Sales under Rule 144 by our affiliates or persons selling shares on behalf of our affiliates are also subject to certain manner of sale provisions and notice requirements and to the availability of current public information about us.

Rule 701

In general, under Rule 701, any of our employees, directors, officers, consultants or advisors who purchases ordinary shares from us in connection with a compensatory share or option plan or other written agreement before the effective date of this offering is entitled to resell such shares 90 days after the effective date of this offering in reliance on Rule 144, without having to comply with the holding period requirements or other restrictions contained in Rule 701.

The Securities and Exchange Commission has indicated that Rule 701 will apply to typical share options granted by an issuer before it becomes subject to the reporting requirements of the Exchange Act, along with the shares acquired upon exercise of such options, including exercises after the date of this prospectus.  Securities issued in reliance on Rule 701 are restricted securities and beginning 90 days after the date of this prospectus, may be sold by persons other than “affiliates,” as defined in Rule 144, subject only to the manner of sale provisions of Rule 144 and by “affiliates” under Rule 144 without compliance with its one-year minimum holding period requirement.

Registration Rights

As described in “Underwriting – Underwriter’s Warrants” below, our underwriter (or its designated affiliates) will have warrants to purchase ADSs upon the closing of this offering, which are exercisable 6 months after the closing of this offering until five years from the effective date of the registration statement of which this prospectus forms a part.  During that time, holders of the warrants will be entitled to request that we register their ADSs under the Securities Act.

TAXATION

The following summaries set forth the material Cayman Islands, PRC and U.S. federal income tax consequences of the acquisition, ownership and disposition of our ADSs or ordinary shares covered by this prospectus, based upon laws and relevant interpretations thereof in effect as of the date of this prospectus, all of which are subject to change.  The summaries do not deal with all possible tax consequences relating to an investment in our ADSs or ordinary shares, such as the tax consequences under U.S. state or local tax laws, or tax laws of jurisdictions other than the Cayman Islands, PRC and the United States.  As used in this discussion, references to “we,” “our” or “us” refer only to Grand Farm Inc.  To the extent that the discussion in any summary constitutes statements of Cayman Islands tax law or legal conclusions with respect thereto, it represents the opinion of Forbes Hare, our Cayman Islands counsel.  To the extent that the discussion in any summary constitutes statements of PRC tax law or legal conclusions with respect thereto, it represents the opinion of B&D Law Firm, our PRC counsel.  To the extent that the discussion in any summary constitutes statements of U.S. federal income tax law or legal conclusions with respect thereto, it represents the opinion of LKP Global Law, LLP, our U.S. counsel.

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Cayman Islands Taxation

The Government of the Cayman Islands will not, under existing legislation, impose any income, corporate or capital gains tax, estate duty, inheritance tax, gift tax or withholding tax upon us or holders of our ADSs or ordinary shares.  The Cayman Islands are not party to a double tax treaty with any country that is applicable to any payments made to or by us.

We have received an undertaking from the Governor-in-Cabinet of the Cayman Islands that, in accordance with section 6 of the Tax Concessions Law (1999 Revision) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable (i) on or in respect of our ADS or ordinary shares, or on our debentures or other obligations or (ii) by way of withholding in whole or in part on a payment of a dividend or other distribution of income or capital by us to holders of our ADSs or ordinary shares or a payment of principal or interest or other sums due under our debentures or other obligations.

PRC Taxation

The following is a summary of the material PRC tax consequencesof the acquisition, ownership and disposition of our ADSs or ordinary shares.  You should consult with your own tax adviser regarding the PRC tax consequences of the acquisition, ownership and disposition of our ADSs or ordinary shares in your particular circumstances.

Resident Enterprise Treatment

On March 16, 2007, the Fifth Session of the Tenth National People’s Congress passed the Enterprise Income Tax Law of the PRC, or the EIT Law, which became effective on January 1, 2008.  Under the EIT Law, enterprises are classified as “resident enterprises” and “non-resident enterprises.”  Pursuant to the EIT Law and its implementing rules, enterprises established outside the PRC whose “de facto management bodies” are located in the PRC are considered “resident enterprises” and subject to the uniform 25% enterprise income tax rate on their worldwide taxable income.  According to the implementing rules of the EIT Law, “de facto management body” refers to a managing body that in practice exercises overall management control over the production and business, personnel, accounting and assets of an enterprise.

On April 22, 2009, the State Administration of Taxation, or the SAT, issued the Notice on the Issues Regarding Recognition of Overseas Incorporated Enterprises that are Domestically Controlled as PRC Resident Enterprises Based on the De Facto Management Body Criteria, or Circular 82, which was retroactively effective as of January 1, 2008.  This notice provides that an overseas incorporated enterprise that is controlled domestically will be recognized as a “tax-resident enterprise” if it satisfies all of the following conditions: (i) the senior management responsible for daily production/business operations are primarily located in the PRC, and the location(s) where such senior management execute their responsibilities are primarily in the PRC; (ii) strategic financial and personnel decisions are made or approved by organizations or personnel located in the PRC; (iii) major properties, accounting ledgers, company seals and minutes of board meetings and shareholder meetings, etc., are maintained in the PRC; and (iv) 50% or more of the board members with voting rights or senior management habitually reside in the PRC.  Although Circular 82 only applies to offshore enterprises controlled by PRC enterprises, not those controlled by PRC individuals or foreigners, like our company, the determining criteria set forth in Circular 82 may reflect the SAT’s general position on how the “de facto management body” test should be applied in determining the tax resident status of offshore enterprises, regardless of whether they are controlled by PRC enterprises, individuals or foreigners.  If the PRC tax authorities determine that we are a “resident enterprise,” we may be subject to enterprise income tax at a rate of 25% on our worldwide income.  This may have an impact on our effective tax rate, and may result in a material adverse effect on our net income and results of operations.  In addition, as discussed below, dividends paid by us to our investors that are not tax residents of the PRC, or non-resident investors, as well as gains realized by such investors from the sale or transfer of our ADSs or ordinary shares may be subject to a PRC tax, and we may be required to withhold PRC tax on dividends paid to our non-resident investors.

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Dividends from Grand Farm WFOE

If Grand Farm HK is not treated as a resident enterprise under the EIT Law, then dividends that Grand Farm HK receives from Grand Farm WFOE may be subject to PRC withholding tax.  The EIT Law and the implementing rules of the EIT Law provide that (A) an income tax rate of 25% normally will be applicable to “non-resident enterprises” that (i) have an establishment or place of business inside the PRC, and (ii) have income in connection with their establishment or place of business that is sourced from the PRC or is earned outside the PRC but has an actual connection with their establishment or place of business inside the PRC, and (B) a PRC withholding tax at a rate of 10% will normally be applicable to dividends payable to non-resident enterprises that (i) do not have an establishment or place of business in the PRC or (ii) have an establishment or place of business in the PRC, but the relevant income is not effectively connected with such establishment or place of business, to the extent such dividends are derived from sources within the PRC.

As described above, the PRC tax authorities may determine the resident enterprise status of entities organized under the laws of foreign jurisdictions on a case-by-case basis.  Grand Farm HK is a holding company and substantially all of its income may be derived from dividends.  Thus, if Grand Farm HK is considered a “non-resident enterprise” under the EIT Law and the dividends paid to Grand Farm HK are considered income sourced within the PRC, such dividends received should be subject to PRC withholding tax as described in the foregoing paragraph.

The State Council of the PRC or a tax treaty between China and the jurisdiction in which the non-resident enterprise resides may reduce such income or withholding tax, with respect to such non-resident enterprise. Pursuant to the Arrangement between the Mainland of China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion With Respect to Taxes on Income, or the PRC-Hong Kong Tax Treaty, and relevant circulars issued by the SAT, if the Hong Kong resident enterprise that is not deemed to be a conduit by the PRC tax authorities owns more than 25% of the equity interests in a PRC resident enterprise, the 10% PRC withholding tax on the dividends the Hong Kong resident enterprise receives from the PRC resident enterprise is reduced to 5%.

We are a Cayman Islands holding company, and we have a subsidiary in Hong Kong (Grand Farm HK), which in turns owns a 100% equity interest in Grand Farm WFOE, a PRC company. As a result, if Grand Farm HK were treated as a “non-resident enterprise” under the EIT Law, then dividends that Grand Farm HK receives from Grand Farm WFOE (assuming such dividends were considered sourced within the PRC) (i) should be subject to a 5% PRC withholding tax, if the PRC-Hong Kong Tax Treaty were applicable, or (ii) if such treaty does not apply (i.e., because the PRC tax authorities may deem Grand Farm HK to be a conduit not entitled to treaty benefits), should be subject to a 10% PRC withholding tax.  Similarly, if we were treated as a “non-resident enterprise” under the EIT Law, and Grand Farm HK were treated as a “resident enterprise” under the EIT Law, then dividends that we receive from Grand Farm HK (assuming such dividends were considered sourced within the PRC) may be subject to a 10% PRC withholding tax.  Any such taxes on dividends could materially reduce the amount of dividends, if any, we could pay to investors in our ADSs or ordinary shares.

As of the date of this prospectus, there has not been a definitive determination as to the “resident enterprise” or “non-resident enterprise” status of us or Grand Farm HK.  As indicated above, however, neither Grand Farm WFOE nor Grand Farm HK is expected to pay any dividends in the near future. Grand Farm WFOE and Grand Farm HK will make any necessary tax withholding if, in the future, Grand Farm WFOE or Grand Farm HK were to pay any dividends and Grand Farm WFOE or Grand Farm HK (based on future clarifying guidance issued by the PRC), or the PRC tax authorities, determine that Grand Farm HK is or we are a non-resident enterprise under the EIT Law.

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Dividends that Non-PRC Resident Investors Receive From Us; Gain on the Sale or Transfer of Our ADSs or Ordinary Shares

If we are determined to be a resident enterprise under the EIT Law and dividends payable to (or gains realized by) our investors that are not tax residents of the PRC, or non-resident investors, are treated as income derived from sources within the PRC, then the dividends that the non-resident investors receive from us and any such gain derived by such investors on the sale or transfer of our ADSs or ordinary shares should be subject to income tax under the PRC tax laws.  As indicated below, under the PRC tax laws, we would not have an obligation to withhold PRC income tax in respect of gains that non-resident investors may realize from the sale or transfer of our ADSs or ordinary shares (regardless of whether such gains would be regarded as income from sources within the PRC), but we would have an obligation to withhold PRC income tax at the applicable rate described below (subject to reduction by applicable tax treaties) on dividends that non-resident investors receive from us if such dividends are regarded as income derived from sources within the PRC.

Under the EIT Law and its implementing rules, PRC withholding tax at the rate of 10% is applicable to dividends payable to non-resident investors that are enterprises (but not individuals) and that (i) do not have an establishment or place of business in the PRC or (ii) have an establishment or place of business in the PRC but the relevant income is not effectively connected with the establishment or place of business, to the extent that such dividends are deemed to be sourced within the PRC.  Similarly, any gain realized on the transfer of our ADSs or ordinary sharesby such investors also is subject to 10% PRC income tax if such gain is regarded as income derived from sources within the PRC.

Under the PRC Individual Income Tax Law and its implementing rules, a potential 20% PRC withholding tax may be applicable to dividends payable to non-resident investors who are individuals and who (i) are not domiciled in the PRC and do not reside in the PRC or (ii) are not domiciled in the PRC and have resided in the PRC for less than one year, to the extent that such dividends are deemed to be sourced within the PRC.  Similarly, any gain realized on the transfer of our ADSs or ordinary shares by such investors may be subject to a 20% PRC income tax if such gain is regarded as income derived from sources within the PRC.

The dividends paid by us to non-resident investors in respect to our ADSs or ordinary shares, or the gain non-resident investors may realize from the sale or transfer of our ADSs or ordinary shares, may be treated as PRC-sourced income and, as a result, may be subject to PRC income tax.  In such event, we should be required to withhold the applicable PRC income tax on any dividends paid to non-resident investors.  In addition, non-resident investors in our ADSs or ordinary shares should be responsible for paying the applicable PRC income tax on any gain realized from the sale or transfer of our ADSs or ordinary shares if such non-resident investors and the gain satisfy the requirements under the PRC tax laws.  However, under the PRC tax laws, we would not have an obligation to withhold PRC income tax in respect of the gains that non-resident investors (including U.S. investors) may realize from the sale or transfer of our ADSs or ordinary shares.

If we were to pay any dividends in the future, and if we (based on future clarifying guidance issued by the PRC), or the PRC tax authorities, determine that we must withhold PRC tax on any dividends payable by us under the PRC tax laws, we will make any necessary tax withholding on dividends payable to our non-resident investors.  If non-resident investors as described under the PRC tax laws (including U.S. investors) realize any gain from the sale or transfer of our ADSs or ordinary shares, and if such gain were considered as PRC-sourced income, such non-resident investors would be responsible for paying the applicable PRC income tax on the gain from the sale or transfer of our ADSs or ordinary shares.  As indicated above, under the PRC tax laws, we would not have an obligation to withhold PRC income tax in respect of the gains that non-resident investors (including U.S. investors) may realize from the sale or transfer of our ADSs or ordinary shares.

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On December 10, 2009, the SAT released Circular Guoshuihan No. 698, or Circular 698, that reinforces the taxation of certain equity transfers by non-resident investors through overseas holding vehicles.  Circular 698 is retroactively effective from January 1, 2008.  Circular 698 addresses indirect equity transfers as well as other issues.  The term “equity transfer income” as used in this circular refers to the income obtained from the transfer of equity of a PRC resident enterprise by a non-resident enterprise (excluding the shares of the PRC resident enterprises bought and sold in the public securities market).According to Circular 698, where a non-resident investor that indirectly holds an equity interestin a PRC resident enterprise through a non-PRC offshore holding company indirectly transfers an equity interest in the PRC resident enterprise by selling an equity interest in the offshore holding company, and the latter is located in a country or jurisdiction where the actual tax burden is less than 12.5% or where the offshore income of its residents is not taxable, the non-resident investor is required to provide the PRC tax authorities in charge of that PRC resident enterprise with certain relevant information within 30 days from the date of the execution of the equity transfer agreement.  The PRC tax authorities in charge will evaluate the offshore transaction for tax purposes.  In the event that the PRC tax authorities determine that such transfer is abusing forms of business organization and a reasonable commercial purpose for the offshore holding company other than the avoidance of PRC income tax liability is lacking, the PRC tax authorities will have the power to re-assess the nature of the equity transfer under the doctrine of substance over form.  If the SAT’s challenge of a transfer is successful, it may deny the existence of the offshore holding company that is used for tax planning purposes and subject the non-resident investor to PRC tax on the capital gain from such transfer.  As the offering of our ADSs is a public offering, Circular 698 should not be applicable.  At the same time, however, because Circular 698 has a short history, there is uncertainty as to its application.  We (or a non-resident investor) may become at risk of being taxed under Circular 698 and may be required to expend valuable resources to comply with Circular 698 or to establish that we (or such non-resident investor) should not be taxed under Circular 698, which could have a material adverse effect on our financial condition and results of operations (or such non-resident investor’s investment in us).

Penalties for Failure to Pay Applicable PRC Income Tax

A non-resident investor in us may be responsible for paying PRC income tax on any gain realized from the sale or transfer of our ADSs or ordinary shares, if such non-resident investor and the gain satisfy the requirements under the PRC tax laws, as described above.

According to the EIT Law and its implementing rules, the PRC Tax Administration Law, or the Tax Administration Law, and its implementing rules, the Provisional Measures for the Administration of Withholding of Enterprise Income Tax for Non-Resident Enterprises, or the Administration Measures, and other applicable PRC laws or regulations (collectively the “Tax Related Laws”), where any gain derived by a non-resident investor from the sale or transfer of our ADSs or ordinary shares, is subject to any income tax in the PRC, and such non-resident investor fails to file any tax return or pay tax in this regard pursuant to the Tax Related Laws, such investor should be subject to certain fines, penalties or punishments, including without limitation: (1) if the non-resident investor fails to file a tax return and present the relevant information in connection with tax payments, the competent PRC tax authorities shall order it to do so within the prescribed time limit and may impose a fine up to RMB 2,000, and in egregious cases, may impose a fine ranging from RMB 2,000 to RMB 10,000; (2) if the non-resident investor fails to file a tax return or fails to pay all or part of the amount of tax payable, the non-resident investor shall be required to pay the unpaid tax amount payable, a surcharge on overdue tax payments (the daily surcharge is 0.05% of the overdue amount, beginning from the day the deferral begins) and a fine ranging from 50% to 500% of the unpaid amount of the tax payable; (3) if the non-resident investor fails to file a tax return and to pay the tax within the prescribed time limit according to the order by the PRC tax authorities, the PRC tax authorities may collect and check information about the income receivable by the non-resident investor in the PRC fromother payers, or the Other Payers, who will pay amounts to such non-resident investor, and send a “Notice of Tax Issues” to the Other Payers to collect and recover the tax payable and overdue fines imposed on such non-resident investor from the amounts otherwise payable to such non-resident investor by the Other Payers; (4) if the non-resident investor fails to pay the tax payable within the prescribed time limit as ordered by the PRC tax authorities, a fine may be imposed on the non-resident investor ranging from 50% to 500% of the unpaid tax payable, and the PRC tax authorities may, upon approval by the director of the tax bureau (or sub-bureau) of, or higher than, the county level, take the following compulsory measures: (i) notify in writing the non-resident investor’s bank or other financial institution to withhold from the account thereof for payment of the amount of tax payable, and (ii) detain, seal off, or sell by auction or on the market the non-resident investor’s commodities, goods or other property in a value equivalent to the amount of tax payable; or (5) if the non-resident investor fails to pay all or part of the amount of tax payable or the surcharge for the overdue tax payment, and cannot provide a guarantee to the PRC tax authorities, the tax authorities may notify the frontier authorities to prevent the non-resident investor or its legal representative from leaving the PRC.

United States Federal Income Taxation

General

The following is a summary of the material U.S. federal income tax consequences of the acquisition, ownership and disposition of our ADSs or ordinary shares.  The discussion below of the U.S. federal income tax consequences to “U.S. Holders” will apply to a beneficial owner of our ADSs or ordinary shares that is for U.S. federal income tax purposes:

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· an individual citizen or resident of the United States;

· a corporation (or other entity treated as a corporation) that is created or organized (or treated as created or organized) in or under the laws of the United States, any state thereof or the District of Columbia;

· an estate whose income is includible in gross income for U.S. federal income tax purposes regardless of its source; or

· a trust if (i) a U.S. court can exercise primary supervision over the trust’s administration and one or more U.S. persons are authorized to control all substantial decisions of the trust, or (ii) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.

A beneficial owner of our ADSs or ordinary shares that is described above is referred to herein as a “U.S. Holder.”  If a beneficial owner of our ADSs or ordinary shares is not described as a U.S. Holder and is not an entity treated as a partnership or other pass- through entity for U.S. federal income tax purposes, such owner will be considered a “Non-U.S. Holder.”  The material U.S. federal income tax consequences applicable specifically to Non-U.S. Holders are described below under the heading “Non-U.S. Holders.”

This summary is based on the Internal Revenue Code of 1986, or the Code, as amended, its legislative history, Treasury regulations promulgated thereunder, published rulings and court decisions, all as currently in effect.  These authorities are subject to change or differing interpretations, possibly on a retroactive basis.

This discussion does not address all aspects of U.S. federal income taxation that may be relevant to any particular holder based on such holder’s individual circumstances.  In particular, this discussion considers only holders that purchase ADSs pursuant to this offering and own and hold our ADSs or ordinary shares as capital assets within the meaning of Section 1221 of the Code, and does not address the potential application of the alternative minimum tax or the U.S. federal income tax consequences to holders that are subject to special rules, including:

· financial institutions or financial services entities;

· broker-dealers;

· persons that are subject to the mark-to-market accounting rules under Section 475 of the Code;

· tax-exempt entities;

· governments or agencies or instrumentalities thereof;

· insurance companies;

· regulated investment companies;

· real estate investment trusts;

· certain expatriates or former long term residents of the United States;

· persons that actually or constructively own 5% or more of our voting shares (including as a result of ownership of our ADSs);

· persons that acquired our ADSs or ordinary shares pursuant to an exercise of employee share options, in connection with employee share incentive plans or otherwise as compensation;

· persons that hold our ADSs or ordinary shares as part of a straddle, constructive sale, hedging, conversion or other integrated transaction; or

· persons whose functional currency is not the U.S. dollar.

The discussion below assumes that the representations contained in the deposit agreement are true and that the obligations in the deposit agreement and any related agreement will be complied with in accordance with their terms.  This discussion also assumes that ADSs will represent only ordinary shares in us and will not represent cash or any other type of property.  For U.S. federal income tax purposes, a holder of ADSs will be treated as the beneficial owner of the underlying ordinary shares represented by such ADSs.  Accordingly, deposits or withdrawals of ordinary shares for ADSs will not be subject to U.S. federal income tax.

The U.S. Treasury has expressed concerns that parties to whom ADSs are pre-released may be taking actions that are inconsistent with the claiming, by U.S. Holders of ADSs, of foreign tax credits for U.S. federal income tax purposes. Such actions also would be inconsistent with the claiming of the reduced rate of tax applicable to dividends received by certain non-corporate U.S. Holders, as described below.  Accordingly, the availability of foreign tax credits or the reduced tax rate for dividends received by certain non-corporate U.S. Holders could be affected by actions that may be taken by parties to whom ADSs are pre-released, or by future actions of the U.S. Treasury Department.

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This discussion does not address any aspect of U.S. federal non-income tax laws, such as gift or estate tax laws, or state, local or non-U.S. tax laws or, except as discussed herein, any tax reporting obligations applicable to a holder of our ADSs or ordinary shares.  This discussion also does not address the tax treatment of any fees or expenses that may be payable by an ADS holder pursuant to the depositary agreement.  Additionally, this discussion does not consider the tax treatment of partnerships or other pass-through entities or persons who hold our ADSs or ordinary shares through such entities.  If a partnership (or other entity classified as a partnership for U.S. federal income tax purposes) is the beneficial owner of our ADSs or ordinary shares, the U.S. federal income tax treatment of a partner in the partnership generally will depend on the status of the partner and the activities of the partnership.  This discussion also assumes that any distribution made (or deemed made) in respect of our ADSs or ordinary shares and any consideration received (or deemed received) by a holder in connection with the sale or other disposition of our ADSs or ordinary shares will be in U.S. dollars.

We have not sought, and do not intend to seek, a ruling from the Internal Revenue Service, or the IRS, as to any U.S. federal income tax consequence described herein.  The IRS may disagree with the description herein, and its determination may be upheld by a court.  Moreover, there can be no assurance that future legislation, regulations, administrative rulings or court decisions will not adversely affect the accuracy of the statements in this discussion.

THIS DISCUSSION IS ONLY A SUMMARY OF THE MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR ADSs OR ORDINARY SHARES.  IT IS NOT TAX ADVICE.  EACH PROSPECTIVE INVESTOR IN OUR ADSs OR ORDINARY SHARES IS URGED TO CONSULT ITS OWN TAX ADVISOR IN RESPECT TO THE PARTICULAR TAX CONSEQUENCES TO SUCH INVESTOR OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR ADSs OR ORDINARY SHARES, INCLUDING THE APPLICABILITY AND EFFECT OF ANY STATE, LOCAL, AND NON-U.S. TAX LAWS, AS WELL AS U.S. FEDERAL TAX LAWS AND ANY APPLICABLE TAX TREATIES.

U.S. Holders

Taxation of Cash Distributions Paid on ADSs or Ordinary Shares

Subject to the passive foreign investment company, or PFIC, rules discussed below, a U.S. Holder will be required to include in gross income as ordinary income the amount of any cash dividend paid on our ADSs or ordinary shares.  A cash distribution on our ADSs or ordinary shares will be treated as a dividend for U.S. federal income tax purposes to the extent the distribution is paid out of our current or accumulated earnings and profits (as determined for U.S. federal income tax purposes), although we do not intend to calculate such earnings and profits.  Such dividend generally will not be eligible for the dividends-received deduction generally allowed to U.S. corporations in respect of dividends received from other U.S. corporations.  The portion of such distribution, if any, in excess of such earnings and profits will be applied against and reduce (but not below zero) the U.S. Holder’s adjusted tax basis in our ADSs or ordinary shares.  Any remaining excess generally will be treated as gain from the sale or other taxable disposition of such ADSs or ordinary shares.

With respect to non-corporate U.S. Holders for taxable years beginning before January 1, 2013, cash dividends may be subject to U.S. federal income tax at the lower applicable regular long term capital gains tax rate (see “ — Taxation on the Disposition of ADSs or Ordinary Shares” below) provided that (a) our ADSs or ordinary shares are readily tradable on an established securities market in the United States or in the event we are deemed to be a PRC “resident enterprise” under the EIT Law, we are eligible for the benefits of the Agreement between the Government of the United States of America and the Government of the People’s Republic of China for the Avoidance of Double Taxation and the Prevention of Tax Evasion with Respect to Taxes on Income, or the U.S.-PRC Tax Treaty, (b) we are not a PFIC, as discussed below, for either the taxable year in which such dividend was paid or the preceding taxable year, and (c) you have held our ADSs or ordinary shares for more than 60 days during the 121-day period that begins 60 days before the first date following the declaration of a dividend on which the purchaser of our ADSs or ordinary shares is not entitled to receive the next dividend payment.  Therefore, if our ADSs or ordinary shares are not readily tradable on an established securities market and if we are not eligible for benefits under the U.S.-PRC Tax Treaty, then such cash dividends paid by us to non-corporate U.S. Holders will not be subject to U.S. federal income tax at the lower regular long term capital gains tax rate.  Under published IRS authority, shares are considered for purposes of clause (a) above to be readily tradable on an established securities market in the United States only if they are listed on certain exchanges, which presently include the NASDAQ Capital Market.  Although we have applied to have our ADSs listed on the NASDAQ Capital Market, we cannot guarantee that our application will be approved.  U.S. Holders should consult their own tax advisors regarding the availability of the lower rate for any cash dividends paid in respect to our ADSs or ordinary shares.  For taxable years beginning on or after January 1, 2013, the regular U.S. federal income tax rate applicable to such dividends currently is scheduled to return to the regular U.S. federal income tax rate generally applicable to ordinary income.

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Any such cash dividends generally will constitute foreign source income for U.S. foreign tax credit limitation purposes and generally will constitute “passive category income,” but could, in the case of certain U.S. Holders, constitute “general category income.”  If a PRC income tax applies to any cash dividends paid to a U.S. Holder on our ADSs or ordinary shares, such tax should be treated as a foreign tax eligible for a deduction from such holder’s U.S. federal taxable income or a foreign tax credit against such holder’s U.S. federal income tax liability (subject to applicable conditions and limitations).  In addition, if such PRC tax applies to any such dividends, an individual U.S. Holder should be entitled to a reduced rate of withholding under the U.S.-PRC Tax Treaty if such holder is considered a resident of the United States for purposes of, and otherwise meets the requirements of, the U.S.-PRC Tax Treaty. Under the U.S.-PRC Tax Treaty, a U.S. Holder is considered a resident of the United States if, by reason of his or her or its domicile, residence, place of head office, place of incorporation or any other criterion of a similar nature, such  U.S. Holder is liable for tax in the United States.  U.S. Holders should consult their own tax advisors regarding the deduction or credit for any such PRC tax and their eligibility for the benefits of the U.S.-PRC Tax Treaty.

Taxation on the Disposition of ADSs or Ordinary Shares

Upon a sale or other taxable disposition of our ADSs or ordinary shares, and subject to the PFIC rules discussed below, a U.S. Holder should recognize capital gain or loss in an amount equal to the difference between the amount realized and the U.S. Holder’s adjusted tax basis in the ADSs or ordinary shares.

The regular U.S. federal income tax rate on capital gains recognized by U.S. Holders generally is the same as the regular U.S. federal income tax rate on ordinary income, except that long term capital gains recognized by non-corporate U.S. Holders generally are subject to U.S. federal income tax at a maximum regular rate of 15% for taxable years beginning before January 1, 2013 (but currently scheduled to increase to 20% for taxable years beginning on or after January 1, 2013).  Capital gain or loss will constitute long term capital gain or loss if the U.S. Holder’s holding period for the ADSs or ordinary shares exceeds one year.  The deductibility of capital losses is subject to various limitations.  Subject to the U.S.-PRC Tax Treaty, any such gain or loss generally will be U.S. source income or loss for U.S. foreign tax credit limitation purposes.

If a PRC income tax applies to any gain from the disposition of our ADSs or ordinary shares by a U.S. Holder, such tax should be treated as a foreign tax eligible for a deduction from such holder’s U.S. federal taxable income or a foreign tax credit against such holder’s U.S. federal income tax liability (subject to applicable conditions and limitations). In addition, if such PRC tax applies to any such gain, such U.S. Holder should be entitled to treat such gain as PRC source under the U.S.-PRC Tax Treaty if such holder is considered a resident of the United States for purposes of, and otherwise meets the requirements of, the U.S.-PRC Tax Treaty.  Under the U.S.-PRC Tax Treaty, a U.S. Holder is considered a resident of the United States if, by reason of his or her or its domicile, residence, place of head office, place of incorporation or any other criterion of a similar nature, such  U.S. Holder is liable for tax in the United States.  U.S. Holders should consult their own tax advisors regarding the deduction or credit for any such PRC tax and their eligibility for the benefits of the U.S.-PRC Tax Treaty.

Passive Foreign Investment Company Rules

A foreign (i.e., non-U.S.) corporation will be a PFIC if either (a) at least 75% of its gross income in a taxable year of the foreign corporation, including its pro rata share of the gross income of any corporation in which it is considered to own at least 25% of the shares by value, is passive income, or (b) at least 50% of its assets in a taxable year of the foreign corporation, ordinarily determined based on fair market value and averaged quarterly over the year, including its pro rata share of the assets of any corporation in which it is considered to own at least 25% of the shares by value, are held for the production of, or produce, passive income.  Passive income generally includes dividends, interest, rents and royalties (other than certain rents or royalties derived from the active conduct of a trade or business), and gains from the disposition of passive assets.

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Based on the expected composition (and estimated values) of the assets and the nature of the income of us and our subsidiaries and our current plans of operation, we do not expect to be treated as a PFIC for the current taxable year or in the near future.  However, our actual PFIC status for our current taxable year or any subsequent taxable year will not be determinable until after the end of such taxable year.  Accordingly, there can be no assurance with respect to our status as a PFIC for our current taxable year or any subsequent taxable year.

If we are determined to be a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. Holder of our ADSs or ordinary shares, and such U.S. Holder did not make either a timely qualified electing fund, or QEF, election for our first taxable year as a PFIC in which the U.S. Holder held (or was deemed to hold) our ADSs or ordinary shares, or a mark-to-market election, as described below, such holder generally will be subject to special rules in respect to:

· any gain recognized by the U.S. Holder on the sale or other disposition of its ADSs or ordinary shares; and

· any “excess distribution” made to the U.S. Holder (generally, any distributions to such U.S. Holder during a taxable year of the U.S. Holder that are greater than 125% of the average annual distributions received by such U.S. Holder in respect of the ADSs or ordinary shares during the three preceding taxable years of such U.S. Holder or, if shorter, such U.S. Holder’s holding period for the ADSs or ordinary shares).

Under these rules,

· the U.S. Holder’s gain or excess distribution will be allocated ratably over the U.S. Holder’s holding period for the ADSs or ordinary shares;

· the amount allocated to the U.S. Holder’s taxable year in which the U.S. Holder recognized the gain or received the excess distribution or to the period in the U.S. Holder’s holding period before the first day of our first taxable year in which we qualified as a PFIC will be taxed as ordinary income;

· the amount allocated to other taxable years (or portions thereof) of the U.S. Holder and included in its holding period will be taxed at the highest tax rate in effect for that year and applicable to the U.S. Holder; and

· the interest charge generally applicable to underpayments of tax will be imposed in respect of the tax attributable to each such other taxable year of the U.S. Holder.

In general, if we are determined to be a PFIC, a U.S. Holder may avoid the PFIC tax consequences described above in respect to our ADSs or ordinary shares by making a timely QEF election to include in income its pro rata share of our net capital gains (as long term capital gain) and other earnings and profits (as ordinary income), on a current basis, in each case whether or not distributed, in the taxable year of the U.S. Holder in which or with which our taxable year ends.  A U.S. Holder may make a separate election to defer the payment of taxes on undistributed income inclusions under the QEF rules, but if deferred, any such taxes will be subject to an interest charge.

The QEF election is made on a shareholder-by-shareholder basis and, once made, can be revoked only with the consent of the IRS. A U.S. Holder generally makes a QEF election by attaching a completed IRS Form 8621 (Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund), including the information provided in a PFIC annual information statement, to a timely filed U.S. federal income tax return for the taxable year to which the election relates. Retroactive QEF elections generally may be made only by filing a protective statement with such return and if certain other conditions are met or with the consent of the IRS.

In order to comply with the requirements of a QEF election, a U.S. Holder must receive certain information from us.  Upon request from a U.S. Holder, we will endeavor to provide to the U.S. Holder no later than 90 days after the request such information as the IRS may require, including a PFIC annual information statement, in order to enable the U.S. Holder to make and maintain a QEF election. However, there is no assurance that we will have timely knowledge of our status as a PFIC in the future or of the required information to be provided.

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If a U.S. Holder has made a QEF election in respect to our ADSs or ordinary shares, and the special tax and interest charge rules do not apply to such ADSs or ordinary shares (because of a timely QEF election for our first taxable year as a PFIC in which the U.S. Holder holds (or is deemed to hold) such ADSs or ordinary shares or a purge of the PFIC taint pursuant to a purging election, as described below), any gain recognized on the sale or other taxable disposition of such ADSs or ordinary shares generally will be taxable as capital gain and no interest charge will be imposed.  As discussed above, U.S. Holders of a QEF are currently taxed on their pro rata shares of the QEF’s earnings and profits, whether or not distributed.  In such case, a subsequent distribution of such earnings and profits that were previously included in income should not be taxable as a dividend to such U.S. Holders.  The adjusted tax basis of a U.S. Holder’s ADSs or ordinary shares in a QEF will be increased by amounts that are included in income, and decreased by amounts distributed but not taxed as dividends, under the above rules.  Similar basis adjustments apply to property if by reason of holding such property the U.S. Holder is treated under the applicable attribution rules as owning ADSs or ordinary shares in a QEF.

Although a determination as to our PFIC status will be made annually, an initial determination that we are a PFIC generally will apply for subsequent years to a U.S. Holder who held our ADSs or ordinary shares while we were a PFIC, whether or not we meet the test for PFIC status in those subsequent years.  A U.S. Holder who makes the QEF election discussed above for our first taxable year as a PFIC in which the U.S. Holder holds (or is deemed to hold) our ADSs or ordinary shares, however, will not be subject to the PFIC tax and interest charge rules discussed above in respect to such ADSs or ordinary shares.  In addition, such U.S. Holder will not be subject to the QEF inclusion regime in respect to such ADSs or ordinary shares for any of our taxable years that end within or with a taxable year of the U.S. Holder and in which we are not a PFIC. On the other hand, if the QEF election is not effective for each of our taxable years in which we are a PFIC and during which the U.S. Holder holds (or is deemed to hold) our ADSs or ordinary shares, the PFIC rules discussed above will continue to apply to such ADSs or ordinary shares unless the holder makes a “purging election” with respect to such ADSs or ordinary shares.  A purging election generally creates a deemed sale of such ADSs or ordinary shares at their fair market value.  The gain recognized by the purging election generally will be subject to the special tax and interest charge rules treating the gain as an excess distribution, as described above. As a result of the purging election, the U.S. Holder generally will increase the adjusted tax basis in its ADSs or ordinary shares by the gain recognized and will also have a new holding period in its ADSs or ordinary shares for purposes of the PFIC rules.

Alternatively, if a U.S. Holder, at the close of its taxable year, owns ADSs or ordinary shares in a PFIC that are treated as marketable stock, the U.S. Holder may make a mark-to-market election in respect to such shares for such taxable year. If the U.S. Holder makes a valid mark-to-market election for the first taxable year of the U.S. Holder in which the U.S. Holder holds (or is deemed to hold) our ADSs or ordinary shares and for which we are determined to be a PFIC, such holder generally will not be subject to the PFIC rules described above in respect to its ADSs or ordinary shares.  Instead, in general, the U.S. Holder will include as ordinary income each year the excess, if any, of the fair market value of its ADSs or ordinary shares at the end of its taxable year over the adjusted tax basis in its ADSs or ordinary shares.  The U.S. Holder also will be allowed to take an ordinary loss in respect of the excess, if any, of the adjusted tax basis of its ADSs or ordinary shares over the fair market value of its ADSs or ordinary shares at the end of its taxable year (but only to the extent of the net amount of previously included income as a result of the mark-to-market election).  The U.S. Holder’s adjusted tax basis in its ADSs or ordinary shares will be adjusted to reflect any such income or loss amounts, and any further gain recognized on a sale or other taxable disposition of the ADSs or ordinary shares will be treated as ordinary income.

The mark-to-market election is available only for stock that is regularly traded on a national securities exchange that is registered with the Securities and Exchange Commission, including the NASDAQ Capital Market, or on a foreign exchange or market that the IRS determines has rules sufficient to ensure that the market price represents a legitimate and sound fair market value.  Although we have applied to list our ADSs on the NASDAQ Capital Market, we cannot guarantee that our application will be approved.  U.S. Holders should consult their own tax advisors regarding the availability and tax consequences of a mark-to-market election in respect to our ADSs or ordinary shares under their particular circumstances.

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If we are a PFIC and, at any time, have a foreign subsidiary that is classified as a PFIC, a U.S. Holder of our ADSs or ordinary shares should be deemed to own a portion of the shares of such lower-tier PFIC, and could incur liability for the deferred tax and interest charge described above if we receive a distribution from, or dispose of all or part of our interest in, or the U.S. Holder were otherwise deemed to have disposed of an interest in, the lower-tier PFIC.  Upon request, we will endeavor to cause any lower-tier PFIC to provide to a U.S. Holder no later than 90 days after the request the information that may be required to make or maintain a QEF election in respect to the lower-tier PFIC.  However, there is no assurance that we will have timely knowledge of the status of any such lower-tier PFIC or that we will be able to cause the lower-tier PFIC to provide the required information.  A mark-to-market election would not be available in respect to such a lower-tier PFIC.  U.S. Holders are urged to consult their own tax advisors regarding the tax issues raised by lower-tier PFICs.

If a U.S. Holder owns (or is deemed to own) ADSs or shares in a PFIC during any taxable year of the U.S. Holder, such holder may have to file an IRS Form 8621 (whether or not a QEF election or mark-to-market election is or has been made), and any other information as may be required by the U.S. Treasury Department.

The rules dealing with PFICs and with the QEF and mark-to-market elections are very complex and are affected by various factors in addition to those described above. Accordingly, U.S. Holders of our ADSs or ordinary shares should consult their own tax advisors concerning the application of the PFIC rules to our ADSs or ordinary shares under their particular circumstances.

Additional Taxes After 2012

For taxable years beginning after December 31, 2012, U.S. Holders that are individuals, estates or trusts and whose income exceeds certain thresholds generally will be subject to a 3.8% Medicare contribution tax on unearned income, including, among other things, cash dividends on, and capital gains from the sale or other taxable disposition of, our ADSs or ordinary shares, subject to certain limitations and exceptions. U.S. Holders should consult their own tax advisors regarding the effect, if any, of such tax on their ownership and disposition of our ADSs or ordinary shares.

Non-U.S. Holders

Cash dividends paid to a Non-U.S. Holder in respect to our ADSs or ordinary shares generally will not be subject to U.S. federal income tax unless the dividends are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, are attributable to a permanent establishment or fixed base that such holder maintains in the United States).

In addition, a Non-U.S. Holder generally will not be subject to U.S. federal income tax on any gain attributable to a sale or other taxable disposition of our ADSs or ordinary shares unless such gain is effectively connected with its conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, is attributable to a permanent establishment or fixed base that such holder maintains in the United States) or the Non-U.S. Holder is an individual who is present in the United States for 183 days or more in the taxable year of sale or other taxable disposition and certain other conditions are met (in which case, such gain from United States sources generally is subject to U.S. federal income tax at a 30% rate or a lower applicable tax treaty rate).

Cash dividends and gains that are effectively connected with the Non-U.S. Holder’s conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, are attributable to a permanent establishment or fixed base in the United States) generally will be subject to U.S. federal income tax (but not the Medicare contribution tax) at the same regular U.S. federal income tax rates as applicable to a comparable U.S. Holder and, in the case of a Non-U.S. Holder that is a corporation for U.S. federal income tax purposes, may also be subject to an additional branch profits tax at a 30% rate or a lower applicable tax treaty rate.

Backup Withholding and Information Reporting

In general, information reporting for U.S. federal income tax purposes should apply to cash distributions made on our ADSs or ordinary shares within the United States to a U.S. Holder (other than an exempt recipient) and to the proceeds from sales and other dispositions of our ADSs or ordinary shares by a U.S. Holder (other than an exempt recipient) to or through a U.S. office of a broker.  Payments made (and sales and other dispositions effected at an office) outside the United States will be subject to information reporting in limited circumstances.  In addition, pursuant to recently enacted legislation, certain information concerning a U.S. Holder’s adjusted tax basis in its ADSs or ordinary share and adjustments to that tax basis and whether any gain or loss with respect to such ADSs or ordinary shares is long-term or short-term may be required to be reported to the IRS.

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Moreover, backup withholding of U.S. federal income tax, at a rate of 28% for taxable years beginning before January 1, 2013 (but currently scheduled to increase to 31% for taxable years beginning on or after January 1, 2013), generally will apply to dividends paid on our ADSs or ordinary shares to a U.S. Holder (other than an exempt recipient) and the proceeds from sales and other dispositions of our ADSs or ordinary shares by a U.S. Holder (other than an exempt recipient), in each case who:

· fails to provide an accurate taxpayer identification number;

· is notified by the IRS that backup withholding is required; or

· in certain circumstances, fails to comply with applicable certification requirements.

A Non-U.S. Holder generally may eliminate the requirement for information reporting and backup withholding by providing certification of its foreign status, under penalties of perjury, on a duly executed applicable IRS Form W-8 or by otherwise establishing an exemption.

Backup withholding is not an additional tax. Rather, the amount of any backup withholding will be allowed as a credit against a U.S. Holder’s or a Non-U.S. Holder’s U.S. federal income tax liability and may entitle such holder to a refund, provided that certain required information is timely furnished to the IRS.  Holders are urged to consult their own tax advisors regarding the application of backup withholding and the availability of and procedures for obtaining an exemption from backup withholding in their particular circumstances.

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UNDERWRITING

We are offering the ADSs described in this prospectus through Newbridge Securities Corporation.  Newbridge Securities Corporation is acting as sole manager of the offering.  We have entered into an underwriting agreement, dated as of      , 2011, with the underwriter, with respect to the ADSs being offered.  Subject to the terms of the underwriting agreement, we have agreed to sell to the underwriter, and the underwriter has agreed to purchase on a firm commitment basis shares in this offering, at the public offering price, less the underwriting discount as indicated in the following table.  Newbridge Securities Corporation’s address is 1451 West Cypress Creek Road, Fort Lauderdale, Florida 33309.

Underwriter	Number of ADSs
Newbridge Securities Corporation
Total

Nature of Underwriting Commitment

The underwriting agreement provides that the underwriter is committed to purchase all ADSs offered in this offering, other than those covered by the over-allotment option described below, if the underwriter purchases any of these securities.  The underwriting agreement provides that the obligations of the underwriter to purchase the ADSs offered hereby are conditional and may be terminated at its discretion based on its assessment of the state of the financial markets.  The obligations of the underwriter may also be terminated upon the occurrence of other events specified in the underwriting agreement.  Furthermore, pursuant to the underwriting agreement, the underwriter’s obligations are subject to approval of certain legal matters by their counsel, including, without limitation, the authorization and the validity of the ADSs, and to various other customary conditions, representations and warranties contained in the underwriting agreement, such as receipt by the underwriter of officers’ certificates and legal opinions of our counsel.

State Blue Sky Information

We intend to offer and sell our ADSs offered hereby to retail customers and institutional investors in all 50 states.  However, we will not make any offer of these securities in any jurisdiction where the offer is not permitted.

Pricing of Securities

The underwriter has advised us that it proposes to offer the ADSs directly to the public at the initial public offering price set forth on the cover page of this prospectus, and to certain dealers that are members of the Financial Industry Regulatory Authority (FINRA), at such price less a concession not in excess of $      per share.  The underwriters may allow, and such dealers may reallow, a discount not in excess of $      per share from the initial public offering price to certain brokers and dealers.  After the public offering, the offering price and concessions and discounts to brokers and dealers and other selling terms may from time to time be changed by the underwriters.

Prior to this offering, there was no public market for the ADSs or ordinary shares in the United States.  The initial public offering price of our ADSs was determined by negotiation between us and the underwriters.  The principal factors considered in determining the public offering price of the ADSs included:

· the information in this prospectus and otherwise available to the underwriter;

· the history and the prospects for the industry in which we will compete;

· the ability of our management;

· the prospects for our future earnings;

· the present state of our development and our current financial condition;

· the general condition of the economy and the securities markets, both in the United States and China, at the time of this offering;

· the recent market prices of, and the demand for, publicly-traded securities of generally comparable companies; and

· other factors as were deemed relevant.

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We cannot be sure that the initial public offering price will correspond to the price at which our ADSs will trade in the public market following this offering or that an active trading market for the ADSs will develop and continue after this offering.

Discounts and Commissions

The following table summarizes the compensation to be paid to the underwriter by us and the proceeds, before expenses, payable to us.  The information assumes either no exercise or full exercise by the underwriter of the over-allotment option.

		Total
	Per ADS	Without Over-Allotment	With Over-Allotment
Public offering price
Underwriting discount(1)
Corporate finance fee (2)
Proceeds, before expenses, to us (3)

(1)           Represents an underwriting discount of 7%.

(2)           The corporate finance fee of 1% is not payable with respect to the ADSs sold upon exercise of the underwriter’s over-allotment option.  We have previously paid to the underwriter a $50,000 advance towards the corporate finance fee.

(3)           We estimate that the total expenses of this offering, excluding the underwriting discount and the corporate finance fee, will be approximately $      million.

Reimbursable Underwriter Expenses

We will reimburse the underwriter for all fees and expenses and disbursements in connection with the offering, including the fees associated with the filing of the offering materials with FINRA, all expenses associated with one or more “road show” marketing trips and the costs associated with I-Deal and Net Roadshow, up to a maximum of $120,000.

Over-Allotment Option to Purchase Additional Shares

We have granted the underwriter an option, exercisable for 45 days after the date of this prospectus, to purchase up to       additional ADSs solely to cover over-allotments, if any, at the same price as the initial ADSs offered.  If the underwriters fully exercise the over-allotment option, the total public offering price, underwriting discounts and proceeds (before expenses) to us will be $     , $     , and $     , respectively.

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Underwriter’s Warrants

In consideration of services provided, we have agreed to issue to the underwriter (or its designated affiliates) at the closing of this offering, warrants to purchase up to a total of       ADSs equal to 7% of the aggregate number of ADSs sold in this offering, including the over-allotment option.  The ADSs issuable upon exercise of the underwriter’s warrants are identical to those offered by this prospectus.  The underwriter’s warrants is exercisable at an exercise price equal to 150% of the initial offering price per ADS in this offering commencing six months after the closing date of this offering and expiring five years from the effective date of the registration statement of which this prospectus forms a part (the “Exercise Period”), and may be exercised on a cashless basis.  The underwriter’s warrants and the ADSs underlying the underwriter’s warrants may not be sold, transferred, assigned, pledged or hypothecated, or be the subject of any hedging, short sale, derivative, put, or call transaction that would result in the effective disposition thereof by any person for a period of 6 months from the closing date of this offering except to members of the selling group and or their respective officers and partners.  We will set aside and at all times have available a sufficient number of ADSs to be issued upon exercise of the underwriter’s warrants.  Following the closing of this offering, we will not have any obligations to update this prospectus, including during the Exercise Period.  Thus, to enable the holders of the underwriter’s warrants, who will initially be the underwriter and/or its designated affiliates, to sell the underlying ADSs in the event of their exercise of the underwriter’s warrants, we have agreed to include in the underwriter’s warrants demand and “piggy back” registration rights for a period of 5 years after the effective date of the registration statement of which this prospectus forms a part with respect to the registration of such ADSs under the Securities Act.  We have further agreed to bear the fees and expenses attendant to one demand registration and an unlimited number of “piggy back” registrations during this 5-year period, and the holders will bear the fees and expenses attendant to one additional demand registration, except that in all cases underwriting commissions (if an underwriter is engaged in connection with the sales of their ADSs) will be paid for by the holders themselves from their sale proceeds pursuant to any such registration.  The exercise price and number of ADSs issuable upon exercise of the warrants may be adjusted in certain circumstances.  Thus, in the event of a stock dividend, the exercise price will be reduced so that the proportion of the number of ADSs issuable upon exercise to the number of ADSs outstanding immediately before and immediately after the dividend will remain the same.   In the event of a stock split, the number of ADSs issuable upon exercise will be adjusted in proportion to such stock split.

Lock-up Agreements

Our directors and officers have agreed that, for a period of 12 months from the closing of this offering, they will not sell, contract to sell, grant any option for the sale or otherwise dispose of any of our equity securities, or any securities convertible into or exercisable or exchangeable for our equity securities, without the consent of the underwriter, including for exercise or conversion of currently outstanding warrants, options and convertible debentures, as applicable.

The underwriter has no present intention to waive or shorten the lock-up period described herein.  The underwriter’s determination to release all or any portion of the shares subject to the lock-up agreements will depend on several factors including, but not limited to, the market price of our ADSs and the general condition of the securities markets.  However, the underwriter’s decision to shorten the lock-up period is arbitrary and may not be based on any specific parameters.

Stabilization

Until the distribution of the ADSs offered by this prospectus is completed, rules of the Securities and Exchange Commission may limit the ability of the underwriters to bid for and to purchase our ADSs.  As an exception to these rules, the underwriter may engage in transactions effected in accordance with Regulation M under the Securities Exchange Act of 1934 that are intended to stabilize, maintain or otherwise affect the price of our ADSs.  The underwriter may engage in over-allotment sales, syndicate covering transactions, stabilizing transactions and penalty bids in accordance with Regulation M.

· Stabilizing transactions permit bids or purchases for the purpose of pegging, fixing or maintaining the price of the ADSs, so long as stabilizing bids do not exceed a specified maximum.

· Over-allotment involves sales by the underwriter of ADSs in excess of the number of ADSs the underwriter is obligated to purchase, which creates a short position.  The short position may be either a covered short position or a naked short position.  In a covered short position, the number of ADSs over-allotted by the underwriter is not greater than the number of ADSs that it may purchase in the over-allotment option.  In a naked short position, the number of ADSs involved is greater than the number of ADSs in the over-allotment option.  The underwriters may close out any covered short position by either exercising its over-allotment option or purchasing ADSs in the open market.

· Covering transactions involve the purchase of securities in the open market after the distribution has been completed in order to cover short positions.  In determining the source of securities to close out the short position, the underwriter will consider, among other things, the price of securities available for purchase in the open market as compared to the price at which they may purchase securities through the over-allotment option.  If the underwriter sells more ADSs than could be covered by the over-allotment option, creating a naked short position, the position can only be closed out by buying securities in the open market.  A naked short position is more likely to be created if the underwriters are concerned that there could be downward pressure on the price of the securities in the open market after pricing that could adversely affect investors who purchase in this offering.

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· Penalty bids permit the underwriter to reclaim a selling concession from a selected dealer when the ADSs originally sold by the selected dealer are purchased in a stabilizing covering transaction to cover short positions.

These stabilizing transactions, covering transactions and penalty bids may have the effect of raising or maintaining the market price of our ADSs or preventing or retarding a decline in the market price of our ADSs.  As a result, the price of our ADSs may be higher than the price that might otherwise exist in the open market.

Neither we nor the underwriter make any representation or prediction as to the effect that the transactions described above may have on the prices of the ADSs.  These transactions may occur on the NASDAQ Capital Market, or on any other trading market.  If any of these transactions are commenced, they may be discontinued without notice at any time.

Foreign Regulatory Restrictions on Purchase of the Ordinary Shares

We have not taken any action to permit a public offering of the ordinary shares outside the United States or to permit the possession or distribution of this prospectus outside the United States.  Persons outside the United States who come into possession of this prospectus must inform themselves about and observe any restrictions relating to this offering of ordinary shares and the distribution of the prospectus outside the United States.  In addition to the public offering of the shares in the United States, the underwriter may, subject to the applicable foreign laws, also offer the ordinary shares to certain institutions or accredited persons in the following countries:

Italy. This offering of our ordinary shares has not been cleared by Consob, the Italian Stock Exchange’s regulatory agency of public companies, pursuant to Italian securities legislation and, accordingly, no ordinary shares may be offered, sold or delivered, nor may copies of this prospectus or of any other document relating to our ordinary shares be distributed in Italy, except (1) to professional investors (operatori qualificati); or (2) in circumstances which are exempted from the rules on solicitation of investments pursuant to Decree No. 58 and Article 33, first paragraph, of Consob Regulation No. 11971 of May 14, 1999, as amended. Any offer, sale or delivery of our ordinary shares or distribution of copies of this prospectus or any other document relating to our ordinary shares in Italy under (1) or (2) above must be (i) made by an investment firm, bank or financial intermediary permitted to conduct such activities in Italy in accordance with the Decree No. 58 and Legislative Decree No. 385 of September 1, 1993, or the Banking Act; and (ii) in compliance with Article 129 of the Banking Act and the implementing guidelines of the Bank of Italy, as amended from time to time, pursuant to which the issue or the offer of securities in Italy may need to be preceded and followed by an appropriate notice to be filed with the Bank of Italy depending, inter alia, on the aggregate value of the securities issued or offered in Italy and their characteristics; and (iii) in compliance with any other applicable laws and regulations.

Germany. The offering of our ordinary shares is not a public offering in the Federal Republic of Germany. The shares may only be acquired in accordance with the provisions of the Securities Sales Prospectus Act (Wertpapier-Verkaudfspropsektgestz), as amended, and any other applicable German law. No application has been made under German law to publicly market our ordinary shares in or out of the Federal Republic of Germany. Our ordinary shares are not registered or authorized for distribution under the Securities Sales Prospectus Act and accordingly may not be, and are not being, offered or advertised publicly or by public promotion. Therefore, this prospectus is strictly for private use and the offering is only being made to recipients to whom the document is personally addressed and does not constitute an offer or advertisement to the public. Our ordinary shares will only be available to persons who, by profession, trade or business, buy or sell securities for their own or a third party’s account.

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France. Our ordinary shares offered by this prospectus may not be offered or sold, directly or indirectly, to the public in France. This prospectus has not been or will not be submitted to the clearance procedure of the Autorité des Marchés Financiers, or the AMF, and may not be released or distributed to the public in France. Investors in France may only purchase the ordinary shares offered by this prospectus for their own account and in accordance with articles L. 411-1, L. 441-2 and L. 412-1 of the Code Monétaire et Financier and decree no. 98-880 dated October 1, 1998, provided they are “qualified investors” within the meaning of said decree. Each French investor must represent in writing that it is a qualified investor within the meaning of the aforesaid decree. Any resale, directly or indirectly, to the public of the ordinary shares offered by this prospectus may be effected only in compliance with the above mentioned regulations. “Les actions offertes par ce document d’information ne peuvent pas être, directement ou indirectement, offertes ou vendues au public en France. Ce document d’information n’a pas été ou ne sera pas soumis au visa de l’Autorité des Marchés Financiers et ne peut être diffusé ou distribué au public en France. Les investisseurs en France ne peuvent acheter les actions offertes par ce document d’information que pour leur compte propre et conformément aux articles L. 411-1, L. 441-2 et L. 412-1 du Code Monétaire et Financier et du décret no. 98-880 du 1 octobre 1998, sous réserve qu’ils soient des investisseurs qualifiés au sens du décret susvisé. Chaque investisseur doit déclarer par écrit qu’il est un investisseur qualifié au sens du décret susvisé. Toute revente, directe ou indirecte, des actions offertes par ce document d’information au public ne peut être effectuée que conformément à la réglementation susmentionnée.”

Greece. The prospectus has been submitted for approval by the SEC and not the Greek Capital Market Committee. All information contained in the prospectus is true and accurate. The offering of our ordinary shares does not constitute an initial public offer in Greece according to CL. 2190/1920 and L. 3401/2005 as amended and in force. This prospectus is strictly for the use of the entity to which it has been addressed to by the company and not to be circulated in Greece or any other jurisdiction.

This information and documentation is true and accurate and in conformity with the information contained in the prospectus for the offer of ordinary shares, which is being reviewed for approval only by the SEC, and does not constitute provision of the investment service of investment advice according to L. 3606/2007. Any recipient of this material has stated to be a qualified and experienced investor and will evaluate the contents and decide on his/her own discretion whether to participate or not at this offering of ordinary shares.

Switzerland. This prospectus may only be used by those persons to whom it has been directly handed out by the offeror or its designated distributors in connection with the offer described therein. The ordinary shares are only offered to those persons and/or entities directly solicited by the offeror or its designated distributors, and are not offered to the public in Switzerland. This prospectus constitutes neither a public offer in Switzerland nor an issue prospectus in accordance with the respective Swiss legislation, in particular but not limited to Article 652A Swiss Code Obligations. Accordingly, this prospectus may not be used in connection with any other offer, whether private or public and shall in particular not be distributed to the public in Switzerland.

United Kingdom. In the United Kingdom, the ordinary shares offered by this prospectus are directed to and will only be available for purchase to a person who is an exempt person as referred to at paragraph (c) below and who warrants, represents and agrees that: (a) it has not offered or sold, will not offer or sell, any ordinary shares offered by this prospectus to any person in the United Kingdom except in circumstances that do not constitute an offer to the public in the United Kingdom for the purposes of the section 85 of the Financial Services and Markets Act 2000 (as amended), or the FSMA; and (b) it has complied and will comply with all applicable provisions of FSMA and the regulations made thereunder in respect of anything done by it in relation to the ordinary shares offered by this prospectus in, from or otherwise involving the United Kingdom; and (c) it is a person who falls within the exemptions to Section 21 of the FSMA as set out in The Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, or the Order, being either an investment professional as described under Article 19 or any body corporate (which itself has or a group undertaking has a called up share capital or net assets of not less than £500,000 (if more than 20 members) or otherwise £5 million) or an unincorporated association or partnership (with net assets of not less than £5 million) or is a trustee of a high value trust or any person acting in the capacity of director, officer or employee of such entities as defined under Article 49(2)(a) to (d) of the Order, or a person to whom the invitation or inducement may otherwise lawfully be communicated or cause to be communicated. The investment activity to which this document relates will only be available to and engaged in only with exempt persons referred to above. Persons who are not investment professionals and do not have professional experience in matters relating to investments or are not an exempt person as described above, should not review nor rely or act upon this document and should return this document immediately. It should be noted that this document is not a prospectus in the United Kingdom as defined in the Prospectus Regulations 2005 and has not been approved by the Financial Services Authority or any competent authority in the United Kingdom.

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Sweden. Neither this prospectus nor the ordinary shares offered hereunder have been registered with or approved by the Swedish Financial Supervisory Authority under the Swedish Financial Instruments Trading Act (1991:980) (as amended), nor will such registration or approval be sought. Accordingly, this prospectus may not be made available nor may the ordinary shares offered hereunder be marketed or offered for sale in Sweden other than in circumstances that are deemed not to be an offer to the public in Sweden under the Financial Instruments Trading Act. This prospectus may not be distributed to the public in Sweden and a Swedish recipient of the prospectus may not in any way forward the prospectus to the public in Sweden.

Norway. This prospectus has not been produced in accordance with the prospectus requirements laid down in the Norwegian Securities Trading Act 1997, as amended. This prospectus has not been approved or disapproved by, or registered with, either the Oslo Stock Exchange or the Norwegian Registry of Business Enterprises. This prospectus may not, either directly or indirectly be distributed to Norwegian potential investors.

Denmark. This prospectus has not been prepared in the context of a public offering of securities in Denmark within the meaning of the Danish Securities Trading Act No. 171 of 17 March 2005, as amended from time to time, or any Executive Orders issued on the basis thereof and has not been and will not be filed with or approved by the Danish Financial Supervisory Authority or any other public authority in Denmark. The offering of the ordinary shares will only be made to persons pursuant to one or more of the exemptions set out in Executive Order No. 306 of 28 April 2005 on Prospectuses for Securities Admitted for Listing or Trade on a Regulated Market and on the First Public Offer of Securities exceeding EUR 2,500,000 or Executive Order No. 307 of 28 April 2005 on Prospectuses for the First Public Offer of Certain Securities between EUR 100,000 and EUR 2,500,000, as applicable.

The Netherlands. The underwriter may not offer, distribute, sell, transfer or deliver any of PCHL’s securities, directly or indirectly, in The Netherlands, as a part of their initial distribution or at any time thereafter, to any person other than our employees or employees of our subsidiaries, individuals who or legal entities which trade or invest in securities in the conduct of their profession or business within the meaning of article 2 of the Exemption Regulation issued under the Securities Transactions Supervision Act 1995 (Vrijstellingsregeling Wet toezich teffectenverkeer1995), which includes banks, brokers, pension funds, insurance companies, securities institutions, investment institutions, and other institutional investors, including, among others, treasuries of large enterprises who or which regularly trade or invest in securities in a professional capacity.

Cyprus. The underwriter has represented, warranted and agreed that: (i) it will not be providing from or within Cyprus any “Investment Services,” “Investment Activities” and “Non-Core Services” (as such terms are defined in the Investment Firms Law 144(I) of 2007, or the IFL, in relation to the ordinary shares, or will be otherwise providing Investment Services, Investment Activities and Non-Core Services to residents or persons domiciled in Cyprus. The underwriter has represented, warranted and agreed that it will not be concluding in Cyprus any transaction relating to such Investment Services, Investment Activities and Non-Core Services in contravention of the IFL and/or applicable regulations adopted pursuant thereto or in relation thereto; and (ii) it has not and will not offer any of the ordinary shares other than in compliance with the provisions of the Public Offer and Prospectus Law, Law 114(I)/2005.

Israel. The ordinary shares offered by this prospectus have not been approved or disapproved by the Israeli Securities Authority, or ISA. The ordinary shares may not be offered or sold, directly or indirectly, to the public in Israel. The ISA has not issued permits, approvals or licenses in connection with the offering of the ordinary shares or publishing the prospectus; nor has it authenticated the details included herein, confirmed their reliability or completeness, or rendered an opinion as to the quality of the ordinary shares being offered. Any resale, directly or indirectly, to the public of the ordinary shares offered by this prospectus is subject to restrictions on transferability and must be effected only in compliance with the Israeli securities laws and regulations.

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Oman. For the attention of the residents of Oman:

The information contained in this prospectus neither constitutes a public offer of securities in the Sultanate of Oman, or Oman, as contemplated by the Commercial Companies Law of Oman (Sultani Decree 4/74) or the Capital Market Law of Oman (Sultani Decree 80/98), nor does it constitute an offer to sell, or the solicitation of any offer to buy non-Omani securities in Oman as contemplated by Article 6 of the Executive Regulations to the Capital Market Law of Oman (issued vide Ministerial Decision No 4/2001), and nor does it constitute a distribution of non-Omani securities in Oman as contemplated under the Rules for Distribution of Non-Omani Securities in Oman issued by the Capital Market Authority of Oman, or CMA. Additionally, this prospectus is not intended to lead to the conclusion of any contract of whatsoever nature within the territory of Oman.

This prospectus has been sent at the request of the investor in Oman, and by receiving this prospectus, the person or entity to whom it has been issued and sent understands, acknowledges and agrees that this prospectus has not been approved by the CMA or any other regulatory body or authority in Oman, nor has any authorization, license or approval been received from the CMA or any other regulatory authority in Oman, to market, offer, sell, or distribute the shares within Oman.

No marketing, offering, selling or distribution of any financial or investment products or services has been or will be made from within Oman and no subscription to any securities, products or financial services may or will be consummated within Oman. The underwriter is neither company licensed by the CMA to provide investment advisory, brokerage, or portfolio management services in Oman, nor banks licensed by the Central Bank of Oman to provide investment banking services in Oman. The underwriter does not advise persons or entities resident or based in Oman as to the appropriateness of investing in or purchasing or selling securities or other financial products.

Nothing contained in this prospectus is intended to constitute Omani investment, legal, tax, accounting or other professional advice. This prospectus is for your information only, and nothing herein is intended to endorse or recommend a particular course of action. You should consult with an appropriate professional for specific advice on the basis of your situation.

United Arab Emirates. This document has not been reviewed, approved or licensed by the Central Bank of the United Arab Emirates, or the UAE, Emirates Securities and Commodities Authority or any other relevant licensing authority in the UAE including any licensing authority incorporated under the laws and regulations of any of the free zones established and operating in the territory of the UAE, in particular the Dubai International Financial Services Authority, or the DFSA, a regulatory authority of the Dubai International Financial Centre, or the DIFC. The sale of the shares does not constitute a public offer of securities in the UAE, DIFC and/or any other free zone in accordance with the Commercial Companies Law, Federal Law No. 8 of 1984 (as amended), DFSA Offered Securities Rules and the Dubai International Financial Exchange Listing Rules, accordingly, or otherwise.

The shares may not be offered to the public in the UAE and/or any of the free zones including, in particular, the DIFC. The shares may be offered and this document may be issued, only to a limited number of investors in the UAE or any of its free zones (including, in particular, the DIFC) who qualify as sophisticated investors under the relevant laws and regulations of the UAE or the free zone concerned. Our management and the underwriter represent and warrant that the shares will not be offered, sold, transferred or delivered to the public in the UAE or any of its free zones including, in particular, the DIFC.

People’s Republic of China. This prospectus may not be circulated or distributed in the PRC, and our ordinary shares may not be offered or sold to any person for re-offering or resale, directly or indirectly, to any resident of the PRC except pursuant to applicable laws and regulations of the PRC. For the purpose of this paragraph, PRC does not include Taiwan and the special administrative regions of Hong Kong and Macau.

Botswana. The company hereby represents and warrants that it has not offered for sale or sold, and will not offer or sell, directly or indirectly the ordinary shares to the public in the Republic of Botswana, and confirms that the offering will not be subject to any registration requirements as a prospectus pursuant to the requirements and/or provisions of the Companies Act, 2003 or the Listing Requirements of the Botswana Stock Exchange.

Hong Kong. The ordinary shares have not been offered or sold and will not be offered or sold in Hong Kong, by means of any document, other than (a) to “professional investors” as defined in the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made under that ordinance; or (b) in other circumstances which do not result in the document being a “prospectus” as defined in the Companies ordinance (Cap. 32) of Hong Kong or which do not constitute an offer to the public within the meaning of that ordinance. No advertisement, invitation or document, whether in Hong Kong or elsewhere, which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) has been issued or will be issued in Hong Kong or elsewhere other than with respect to the ordinary shares that are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made under that ordinance.

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The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in any doubt about any of the contents of this document, you should obtain independent professional advice.

Cayman Islands.  This prospectus does not constitute a public offering of the ordinary shares, whether by way of sale or subscription, in the Cayman Islands.

Japan.  The ordinary shares have not been and will not be registered under the Securities and Exchange Law of Japan.  The underwriters have not offered or sold, and may not offer or sell, directly or indirectly, any ordinary shares in Japan or to, or for the account or benefit of, any resident of Japan or to, or for the account or benefit of, any resident for reoffering or resale, directly or indirectly, in Japan or to, or for the account or benefit of, any resident of Japan except:

· pursuant to an exemption from the registration requirements of, or otherwise in compliance with, the Securities and Exchange Law of Japan; and

· in compliance with the other relevant laws and regulations of Japan.

Singapore. This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the ordinary shares may not be circulated or distributed, nor may the ordinary shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore, or the SFA, (ii) to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

Where the ordinary shares are subscribed or purchased under Section 275 by a relevant person which is: (a) a corporation (which is not an accredited investor) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or (b) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary is an accredited investor, shares, debentures and units of shares and debentures of that corporation or the beneficiaries’ rights and interest in that trust shall not be transferable for 6 months after that corporation or that trust has acquired the shares under Section 275 except: (1) to an institutional investor under Section 274 of the SFA or to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA; (2) where no consideration is given for the transfer; or (3) by operation of law.

NOTICE TO CANADIAN INVESTORS

Resale Restrictions

The distribution of the ordinary shares in Canada is being made only on a private placement basis exempt from the requirement that we prepare and file a prospectus with the securities regulatory authorities in each province where trades of ordinary shares are made. Any resale of the ordinary shares in Canada must be made under applicable securities laws which will vary depending on the relevant jurisdiction, and which may require resales to be made under available statutory exemptions or under a discretionary exemption granted by the applicable Canadian securities regulatory authority. Purchasers are advised to seek legal advice prior to any resale of the ordinary shares.

117

Representations of Purchasers

By purchasing ordinary shares in Canada and accepting a purchase confirmation, a purchaser is representing to us and the dealer from whom the purchase confirmation is received that:

· the purchaser is entitled under applicable provincial securities laws to purchase the ordinary shares without the benefit of a prospectus qualified under those securities laws;

· where required by law, that the purchaser is purchasing as principal and not as agent;

· the purchaser has reviewed the text above under Resale Restrictions; and

· the purchaser acknowledges and consents to the provision of specified information concerning its purchase of the ordinary shares to the regulatory authority that by law is entitled to collect the information.

Further details concerning the legal authority for this information are available on request.

Rights of Action — Ontario Purchasers Only

Under Ontario securities legislation, certain purchasers who purchase a security offered by this prospectus during the period of distribution will have a statutory right of action for damages, or while still the owner of the ordinary shares, for rescission against us in the event that this prospectus contains a misrepresentation without regard to whether the purchaser relied on the misrepresentation. The right of action for damages is exercisable not later than the earlier of 180 days from the date the purchaser first had knowledge of the facts giving rise to the cause of action and three years from the date on which payment is made for the ordinary shares. The right of action for rescission is exercisable not later than 180 days from the date on which payment is made for the ordinary shares. If a purchaser elects to exercise the right of action for rescission, the purchaser will have no right of action for damages against us. In no case will the amount recoverable in any action exceed the price at which the ordinary shares were offered to the purchaser and if the purchaser is shown to have purchased the securities with knowledge of the misrepresentation, we will have no liability. In the case of an action for damages, we will not be liable for all or any portion of the damages that are proven to not represent the depreciation in value of the ordinary shares as a result of the misrepresentation relied upon. These rights are in addition to, and without derogation from, any other rights or remedies available at law to an Ontario purchaser. The foregoing is a summary of the rights available to an Ontario purchaser. Ontario purchasers should refer to the complete text of the relevant statutory provisions.

Enforcement of Legal Rights

All of our directors and officers as well as the experts named herein may be located outside of Canada and, as a result, it may not be possible for Canadian purchasers to effect service of process within Canada upon us for those persons. All or a substantial portion of our assets and the assets of those persons may be located outside of Canada and, as a result, it may not be possible to satisfy a judgment against us or those persons in Canada or to enforce a judgment obtained in Canadian courts against us or those persons outside of Canada.

Taxation and Eligibility for Investment

Canadian purchasers of ordinary shares should consult their own legal and tax advisors with respect to the tax consequences of an investment in the ordinary shares in their particular circumstances and about the eligibility of the ordinary shares for investment by the purchaser under relevant Canadian legislation.

Indemnification

The underwriting agreement provides for indemnification between us and the underwriter against specified liabilities, including liabilities under the Securities Act, and for contribution by us and the underwriter to payments that may be required to be made with respect to those liabilities. We have been advised that, in the opinion of the SEC, indemnification for liabilities under the Securities Act is against public policy as expressed in the Securities Act, and is therefore, unenforceable.

118

EXPENSES RELATING TO THIS OFFERING

The following table sets forth the main estimated expenses in connection with this offering, other than the underwriting discounts and commissions, which we will be required to pay:

SEC registration fee	$	3,483.00
FINRA filing fee		4,490.00
NASDAQ listing fee
Legal fees and expenses
Accounting fees and expenses		480,000.00
Printing fees
Other fees and expenses
Total	$

All amounts are estimated, except the SEC registration fee, the NASDAQ listing fee and the FINRA filing fee.

119

LEGAL MATTERS

The validity of the ordinary shares and other legal matters in connection with this offering with respect to Cayman Islands law will be passed upon for us by Forbes Hare.  LKP Global Law, LLP acted as U.S. counsel for us in connection with this offering.  Loeb & Loeb LLP has acted as counsel to the underwriter in this offering. Legal matters as to PRC law will be passed upon for us by B&D Law Firm and for the underwriter by Han Kun Law Offices.  LKP Global Law, LLP may rely upon Forbes Hare with respect to matters governed by Cayman Islands law and B&D Law Firm with respect to matters governed by PRC law.  Loeb & Loeb LLP may rely upon Han Kun Law Offices with respect to matters governed by PRC law.

EXPERTS

The financial statements as of December 31, 2008, 2009 and 2010 and for each of the three years in the period ended December 31, 2010 included in this prospectus and in the registration statement of which this prospectus is a part of have been so included in reliance on the report of BDO Limited, an independent registered public accounting firm, appearing elsewhere herein and in the registration statement, given on the authority of said firm as experts in auditing and accounting..

WHERE YOU CAN FIND ADDITIONAL INFORMATION

We have filed with the SEC a registration statement on Form F-1 under the Securities Act with respect to our ordinary shares offered by this prospectus.  This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement or the exhibits and schedules that are part of the registration statement.  For further information about us and about the ordinary shares, you should refer to our registration statement and its exhibits.  This prospectus summarizes the content of contracts and other documents to which we refer you.  Since this prospectus may not contain all of the information that is important to you, you should review the full text of these documents.  We have included copies of these documents as exhibits to our registration statement.  These documents are available for inspection at our principal executive offices during normal business hours at No. 2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, PRC 351111.  In addition, you may read and copy these, and any other documents that we file with the SEC, at the SEC’s Public Reference Room at 100 F Street, N.E., Washington D.C. 20549. Please call the SEC at 1-800-SEC-0330 for more information on the public reference rooms and their copy charges.  The SEC also maintains a website that contains reports, proxy and information statements and other information regarding issuers, such as us, who file electronically with the SEC.  The address of that website is http://www.sec.gov.

Upon the completion of this offering, we will become subject to periodic reporting and other information requirements of the Exchange Act as applicable to foreign private issuers and will file reports, including annual reports on Form 20-F, and other information with the SEC.  As we are a foreign private issuer, we are exempt from some of the Exchange Act reporting requirements, the rules prescribing the furnishing and content of proxy statements to shareholders, and Section 16 short swing profit reporting for our officers and directors and for holders of more than 10% of our ordinary shares.  However, we intend to furnish the depositary with our annual reports, which will include a review of operations and annual audited consolidated combined financial statements prepared in conformity with U.S. GAAP, and all notices of shareholders meeting and other reports and communications that are made generally available to our shareholders.  The depositary will make such notices, reports and communications available to holders of ADSs and will mail the information contained in any notice of a shareholders meeting received by the depositary from us to all record holders of ADSs.

COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling the registrant pursuant to the foregoing provisions, the registrant has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is therefore unenforceable.

120

GRAND FARM INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

TABLE OF CONTENTS	PAGE
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	F - 2
CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2009 AND 2010	F - 3
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2008, 2009 AND 2010	F - 4
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, 2008, 2009 AND 2010	F - 5
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2008, 2009 AND 2010	F - 6
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2008, 2009 AND 2010	F - 8

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and the Board of Directors of

Grand Farm Inc.

We have audited the accompanying consolidated balance sheets of Grand Farm Inc. (“Grand Farm”), its subsidiaries and variable interest entity (collectively the “Company”) as of December 31, 2009 and 2010, and the related consolidated statements of income and comprehensive income, shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2010. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Company is not required to have, nor were 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 also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, 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 consolidated financial position of the Company as of December 31, 2009 and 2010, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2010, in conformity with the accounting principles generally accepted in the United States of America.

/s/ BDO Limited

Hong Kong, April 7, 2011

F-2

GRAND FARM INC.

CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands, except share and share data)

	December 31,
	2009		2010
ASSETS
Current assets
Cash and cash equivalents	$	3,727	$	7,063
Accounts receivable, less allowances for doubtful amounts of $Nil as of December 31, 2009 and 2010		6,519		8,565
Advances to suppliers (note 4)		4,366		18,126
Inventories (note 5)		17,083		8,914
Prepaid expenses and other current assets (note 6)		798		1,012
Amounts due from related parties (note 3)		5,513		-
Total current assets		38,006		43,680
Land use rights, net (note 7)		429		434
Property, plant and equipment, net (note 8)		5,701		9,901
Deferred income tax assets (note 11)		39		70
Total assets	$	44,175	$	54,085
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Short-term borrowings (note 9)	$	14,655	$	16,199
Bills payable		1,983		3,034
Accounts payable		484		178
Deferred revenues		7		8
Other payables and accrued expenses (note 10)		160		775
Amount due to a related party (note 3)		-		808
Value added and other taxes payable		21		835
Total current liabilities		17,310		21,837
Long-term borrowings (note 9)		224		232
Deferred revenues		89		84
Total liabilities		17,623		22,153
Commitments and contingencies (note 16)		-		-
Shareholders’ equity
Ordinary shares, $0.002 par value - 100,000,000 shares authorized,   25,000,000 shares issued and outstanding (note 13)		50		50
Additional paid-in capital		4,967		5,017
Statutory reserves  (note 14)		1,976		2,901
Retained earnings		18,146		21,316
Accumulated other comprehensive income		1,413		2,648
Total shareholders’ equity		26,552		31,932
Total liabilities and shareholders’ equity	$	44,175	$	54,085

The accompany notes are integral part of these consolidated financial statements.

F-3

GRAND FARM INC.

CONSOLIDATED STATEMENTS OF

INCOME AND COMPREHENSIVE INCOME

(U.S. dollars in thousands, except share and per share data)

	Year ended December 31,
	2008			2009			2010
Revenues	$	36,007		$	60,533		$	82,189
Cost of revenues		(29,447	)		(46,688	)		(64,631	)
Gross profit		6,560			13,845			17,558
Operating expenses:
Selling		(343	)		(404	)		(747	)
General and administrative		(478	)		(676	)		(2,049	)
Government subsidies		147			126			81
Total operating expenses		(674	)		(954	)		(2,715	)
Income from operations		5,886			12,891			14,843
Other income (expenses):
Interest income		16			1			3
Interest expense		(951	)		(860	)		(847	)
Other income		1			13			75
Other expenses		(8	)		(1	)		-
Total other expenses, net		(942	)		(847	)		(769	)
Income before income tax expense		4,944			12,044			14,074
Income tax (expense) benefit (note 11)		(3	)		27			21
Net income		4,941			12,071			14,095
Foreign currency translation adjustment		704			7			1,235
Comprehensive income	$	5,645		$	12,078		$	15,330
Net income per share (note 12)
- Basic	$	0.20		$	0.48		$	0.56
- Diluted	$	0.20		$	0.48		$	0.56
Weighted average number of ordinary shares outstanding (note 12) (shares in thousands)
- Basic		25,000			25,000			25,000
- Diluted		25,000			25,000			25,000

The accompany notes are integral part of these consolidated financial statements.

F-4

GRAND FARM INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(U.S. dollars in thousands, except share and share data)

	Ordinary shares											Accumulated
	Shares outstanding		Amount		Additional paid-in capital		Statutory reserves		Retained earnings			Other Comprehensive income		Total
Balance at January 1, 2008		25,000,000	$	50	$	4,967	$	275		2,835			702		8,829
Net income		-		-		-		-		4,941			-		4,941
Appropriation to statutory reserves		-		-		-		494		(494	)		-		-
Foreign currency translation adjustment		-		-		-		-		-			704		704
Balance at December 31, 2008		25,000,000		50		4,967		769		7,282			1,406		14,474
Net income		-		-		-		-		12,071			-		12,071
Appropriation to statutory reserves		-		-		-		1,207		(1,207	)		-		-
Foreign currency translation adjustment		-		-		-		-		-			7		7
Balance at December 31, 2009		25,000,000		50		4,967		1,976	$	18,146		$	1,413	$	26,552
Net income		-		-		-		-		14,095			-		14,095
Appropriation to statutory reserves		-		-		-		925		(925	)		-		-
Capital contribution		-		-		50		-		-			-		50
Foreign currency translation adjustment		-		-		-		-		-			1,235		1,235
Dividends (note 15)		-		-		-		-		(10,000	)		-		(10,000	)
Balance at December 31, 2010		25,000,000	$	50	$	5,017	$	2,901	$	21,316		$	2,648	$	31,932

The accompany notes are integral part of these consolidated financial statements.

F-5

GRAND FARM INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands, except share and per share data)

	Years ended December 31,
	2008			2009			2010
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	4,941		$	12,071		$	14,095
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization		316			325			368
Impairment of property, plant and equipment		-			-			16
Deferred income tax		(2	)		(32	)		(28	)
Changes in operating assets and liabilities:
Accounts receivable		(619	)		(3,726	)		(1,779	)
Inventories		(1,833	)		(10,162	)		8,534
Prepaid expenses and other current assets		456			(513	)		(412	)
Advances to suppliers		(349	)		(2,562	)		(13,275	)
Amounts due from related parties		(7,053	)		6,596			4,436
Accounts payable		86			200			(314	)
Bills payable		2,883			(950	)		959
Advances from customers		2			(2	)		-
Other payables and accrued expenses		(530	)		84			602
Amount due to a related party		-			-			808
Deferred revenue		-			89			(8	)
Value added and other tax payable		325			(534	)		793
Income taxes payable		(48	)		-			-
Net cash (used in) provided by operating activities		(1,425	)		884			14,795
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment		(2	)		(312	)		(4,280	)
Loans made to other debtors		(6,136	)		(6,579	)		(1,108	)
Loans made to related parties		-			(3,250	)		(4,518	)
Repayment from other debtors		6,576			7,377			1,338
Repayment from related parties		-			2,136			5,642
Net cash provided by (used in)  investing activities		438			(628	)		(2,926	)

The accompany notes are integral part of these consolidated financial statements.

F-6

GRAND FARM INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

(U.S. dollars in thousands, except share and per share data)

	Years ended December 31,
	2008			2009			2010
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from capital contribution		-			-			50
Proceeds from short term borrowings		18,740			19,778			32,088
Repayment of short term borrowings		(17,730	)		(16,860	)		(31,070	)
Proceeds from other loans matured within 3 months		11,901			4,043			1,041
Proceeds from loans from related parties  matured within 3 months		-			6,459			16,445
Repayments of other loans matured within 3 months		(11,901	)		(4,043	)		(1,041	)
Repayments to related parties for loans  matured within 3 months		-			(6,459	)		(16,445	)
Proceeds from long term borrowings		-			224			-
Dividends paid (note 15)		-			-			(10,000	)
Net cash provided by (used in) financing activities		1,010			3,142			( 8,932	)
EFFECT OF EXCHANGE RATE CHANGES		20			1			399
NET INCREASE IN CASH AND CASH EQUIVALENTS		43			3,399			3,336
CASH AND CASH EQUIVALENTS, AT BEGINNING OF YEAR		285			328			3,727
CASH AND CASH EQUIVALENTS, AT END OF THE YEAR		328		$	3,727		$	7,063
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the year for:
Interest	$	951		$	860		$	847
Income taxes	$	53		$	5		$	7

The accompany notes are integral part of these consolidated financial statements.

F-7

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

1. ORGANIZATION AND PRINCIPAL ACTIVITIES

Grand Farm Inc. (“Grand Farm”) was incorporated as a limited liability company established under the laws of the Cayman Islands on June 30, 2010 by Sunlight Blaze Holdings Limited (“Sunlight Blaze”) and other 6 investors. Sunlight Blaze and the other 6 investors hold 85% and 15% equity interests of Grand Farm, respectively. Sunlight Blaze is a limited liability company established under the laws of the British Virgin Islands on April 9, 2010, 99.75% and 0.25% of which outstanding equity interests are held by Mr. Jianshan Yao (“Mr. Yao” or the “Founder”) and Mr. Jianxin Yao, respectively.

The accompanying consolidated financial statements include the financial statements of Grand Farm and the following companies (collectively, the “Company”):

Name	Place of incorporation/ registration and operation	Date of incorporation/ registration	Percentage of ownership interest attributable to Grand Farm		Principal activities
Subsidiaries:
Asia Success Holdings Limited (“Asia Success”)	Hong Kong	June 29, 2010		100%	Investment holding
Putian Asia Success Cereals & Oils Technical Services Co., Ltd. (“Putian Asia Success”)	The People’s Republic of China (“PRC”)	September 19, 2010		100%	Provision of technical consulting service
Variable interest entity (“VIE”):
Fujian Grand Farm Foods Development Co., Ltd. (“Fujian Grand Farm”)	PRC	May 31, 2001		100%	Deep processing, sales, distribution and development of milled rice and other rice products

F-8

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

1. ORGANIZATION AND PRINCIPAL ACTIVITIES - Continued

The Company is primarily engaged in the processing, sales and distribution of milled rice under the “Grand Farm” brand name and other rice products in the PRC.

History of the Company and corporate organization

Grand Farm holds 100% of the equity interests of Asia Success, a Hong Kong company incorporated on June 29, 2010.

Putian Asia Success was incorporated as a limited liability company established under the laws of the PRC on September 19, 2010, by Asia Success for the purpose of acquiring the equity interest of Fujian Grand Farm. Asia Success holds 100% of the equity interests of Putian Asia Success.

Fujian Grand Farm is a limited liability company established under the laws of the PRC on May 31, 2001 in Fujian Province, PRC. Through a series of capital injections and equity transfers from the date of Fujian Grand Farm’s establishment to October 23, 2006, the Founder and his brother, Mr. Jianxin Yao (each an “Original Equity Owner” and collectively the “Original Equity Owners”), have owned 99.75% and 0.25% of the equity interests of Fujian Grand Farm, respectively, since October 23, 2006. Thus, the Founder has been the major beneficiary owner of, and has had control over, Fujian Grand Farm since that date.

As a Cayman Islands company, Grand Farm is deemed a foreign legal person under PRC laws. Accordingly, Putian Asia Success, as Grand Farm’s wholly-owned subsidiary in the PRC, is deemed a foreign invested enterprise and was subject to certain procedures and approval from the PRC authorities prior to acquiring its equity interest in Fujian Grand Farm.

Accordingly, on September 25, 2010, in order to control Fujian Grand Farm and its operations while ensuring proper compliance with PRC laws, Putian Asia Success entered into a series of contractual agreements (collectively the “VIE Agreements”) with Fujian Grand Farm and the Original Equity Owners. The VIE Agreements provide Grand Farm,  through Putian Asia Success,  the ability to control Fujian Grand Farm and to receive the majority of the expected residual returns of Fujian Grand Farm, and make Grand Farm, through Putian Asia Success,  absorb a majority of the risk of losses from Fujian Grand Farm.

F-9

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

1. ORGANIZATION AND PRINCIPAL ACTIVITIES - Continued

The VIE Agreements

a) Exclusive Technical Consulting Service Agreement

Pursuant to the exclusive technical consulting service agreement between Putian Asia Success and Fujian Grand Farm, Putian Asia Success has the exclusive right to provide technical, business and management consulting services to Fujian Grand Farm, in exchange for consulting fees equal to 85% of Fujian Grand Farm’s total annual net profits. This agreement is effective until September 24, 2060, provided that Putian Asia Success may terminate the agreement before such time upon a 30-day written notice to Fujian Grand Farm.  Fujian Grand Farm, however, may not terminate the agreement except for gross negligence, bankruptcy, fraud or illegal action of Putian Asia Success.  Putian Asia Success has the sole discretion to renew the agreement for additional terms of 50 years following the termination date.

b) Equity Interest Pledge Agreements

Pursuant to the equity interest pledge agreement that each Original Equity Owner entered into with Putian Asia Success and Fujian Grand Farm, the Original Equity Owners have pledged all of their equity interests in Fujian Grand Farm to Putian Asia Success as security for Fujian Grand Farm’s performance of its obligations under the exclusive technical consulting service agreement. Under this agreement, Putian Asia Success is also entitled to collect 15% of Fujian Grand Farm’s total annual net profits that is derivative of the Original Equity Owners’ respective equity interests in Fujian Grand Farm. On December 3, 2010, the registration with the Administration of Industry and Commerce’s Putian office for the pledged equity interests of the two Original Equity Owners was completed.

c) Exclusive Equity Interest Purchase Agreements

Pursuant to the exclusive equity interest purchase agreement that each Original Equity Owner entered into with Putian Asia Success and Fujian Grand Farm, the Original Equity Owners irrevocably grant Putian Asia Success an exclusive right to purchase all or any portion of their respective equity interests in Fujian Grand Farm. The exercise price for the rights shall be mutually determined by the Original Equity Owners and Putian Asia Success in accordance with the evaluation of the equity interests by the relevant qualified institute, and shall be the lowest price allowable under PRC laws. This agreement is effective until September 24, 2060.  During such time, Putian Asia Success or its designee may exercise the option under the agreement when the attendant administrative procedures as may be imposed by current regulations are clearer and less burdensome.

F-10

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

1. ORGANIZATION AND PRINCIPAL ACTIVITIES - Continued

The VIE Agreements - Continued

d) Operating Agreement

Pursuant to the operating agreement among Putian Asia Success, Fujian Grand Farm and the Original Equity Owners, Fujian Grand Farm must designate Putian Asia Success’s nominees to be the directors on its board of directors, and appoint Putian Asia Success’s management to be its General Manager, Chief Financial Officer, and other senior officers. Fujian Grand Farm also agrees to accept the policies and guidance provided by Putian Asia Success from time to time in connection with Fujian Grand Farm’s daily operations, financial management and recruitment, retention and dismissal of its employees. In addition, Fujian Grand Farm agrees that it will not engage in any transactions that could materially affect its assets, liabilities, rights or operations without the prior consent of Putian Asia Success. Subject to Fujian Grand Farm’s compliance with the terms of this agreement, Putian Asia Success has the right but not the obligation to provide the appropriate guarantee to Fujian Grand Farm for Fujian Grand Farm’s performance of any contract or for working capital loan in the course of its operation.  This agreement is effective until September 24, 2060, provided that Putian Asia Success may terminate the agreement before such time upon a 30-day written notice to Fujian Grand Farm.  Fujian Grand Farm, however, may not terminate the agreement. Putian Asia Success has the sole discretion to renew the agreement for additional terms of 50 years.

e) Power of Attorney

Pursuant to their powers of attorney, the Original Equity Owners have granted Putian Asia Success with full authority to perform and exercise any and all shareholder’s rights associated with the Original Equity Owners’ equity interests in Fujian Grand Farm, including but not limited to, the right to attend shareholders’ meetings, sell, assign, transfer or pledge any or all of the equity interest, and vote the equity interests (including executing shareholders’ resolutions) on all matters, including but not limited to, the appointment of legal representatives, board members, executive directors, inspectors, chief managers and other senior management members. Each Original Equity Owner’s power of attorney shall remain in effect for as long as such Original Equity Owner holds any equity interest in Fujian Grand Farm.

On December 30, 2010, Fujian Grand Farm, Putian Asia Success and the Original Equity Owners entered into a separate agreement (the “Dividend Agreement”) in which Putian Asia Success authorized Fujian Grand Farm to declare and distribute 52% of Fujian Grand Farm’s unappropriated earnings as of December 31, 2009 to the Original Equity Owners (note 15).  The agreement also provides that no other unappropriated earnings of Fujian Grand Farm may be declared or distributed as dividend to the Original Equity Owners, including the remaining 48% of unappropriated earnings of Fujian Grand Farm as of December 31, 2009 as well as its unappropriated earnings for 2010 and after.

F-11

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

1. ORGANIZATION AND PRINCIPAL ACTIVITIES - Continued

The VIE Agreements - Continued

As a result of the VIE Agreements and the Dividend Agreement, notwithstanding the lack of direct equity ownership, Grand Farm, through Putian Asia Success, has become the primary beneficiary of Fujian Grand Farm, and has measured and recognized Fujian Grand Farm’s assets, liabilities, and non-controlling interests, if any, to present consolidated financial statements in accordance with ASC 810-10, Consolidation, “Variable Interest Entities” subsections (“ASC 810-10”) issued by the Financial Accounting Standard Board (the “FASB”).

As the Founder has owned and controlled Fujian Grand Farm since October 23, 2006, and continues to control Fujian Grand Farm through Putian Asia Success and the VIE Agreements by virtue of his indirect majority ownership of Grand Farm, the execution of the VIE Agreements is considered as a business combination under common control. Accordingly, the Company’s financial statements include the financial position, results and cash flows of Fujian Grand Farm, subsequent to the effective date of the VIE Agreements on September 25, 2010 are presented on a consolidated basis and the periods before that date are presented retrospectively as if the VIE agreements were effective throughout the periods.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a) Principles of presentation and combination

The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”), and include the consolidated assets, liabilities, revenues, expenses and cash flows of all subsidiaries and variable interest entity. Inter-company balances, transactions and cash flows are eliminated upon consolidation.

b) Use of estimates

The preparation of the consolidated financial statements in conformity with US GAAP 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 dates of the consolidated financial statements and the reported amounts of revenues and expenses during the periods reported. Estimates are adjusted to reflect actual experience when necessary. Significant accounting estimates reflected in the Company’s consolidated financial statements include inventory valuation and useful lives of plant and equipment. Actual results could differ from those estimates.

c) Cash and cash equivalents

Cash and cash equivalents include cash on hand and demand deposits with banks with a maturity of three months or less.

F-12

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

d) Inventories

Inventories are stated at the lower of cost or market value and determined by the first-in-first-out method. Work-in-progress and finished goods inventories consist of raw materials, direct labor and overhead associated with the Company’s manufacturing process.

e) Prepaid expenses and other current assets

Prepaid expenses and other current assets consist principally of prepaid expenses, other miscellaneous receivables and temporary advances to the third parties which were interest-free, unsecured and repayable on demand.

f) Property, plant and equipment, net

Property, plant and equipment are recorded at cost less accumulated depreciation and impairment. Maintenance and repairs are charged to expense as incurred. Depreciation of property, plant and equipment is calculated on a straight-line basis over the following estimated useful lives:

Plant and building	20-35 years
Machinery and equipment	15 years
Furniture and office equipment	5 years
Electronic equipment	5 years
Motor vehicles	8-10 years

The Company is constructing certain production facilities. In addition to costs under construction contracts, external costs directly related to the construction of such facilities, including duty and tariff, and equipment installation and shipping costs, are capitalized. Capitalization of these costs ceases and construction-in-progress is transferred to property, plant and equipment when substantially all the activities necessary to prepare the assets for their intended use are completed. No depreciation is provided until construction is completed and the facility is ready for its intended use.

g) Land use rights, net

Land use rights represent rights to use state-owned land in the PRC with lease terms of 50 years expiring in 2055. Land use rights are recorded at cost less accumulated amortization. Amortization is provided over the term of the land use right of 50 years on a straight-line basis.

F-13

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

h) Leases

Each lease is classified at its inception date as either a capital lease or an operating lease. For the lessee, a lease is a capital lease if any of the following conditions exist: (a) ownership is transferred to the lessee by the end of the lease term, (b) there is a bargain purchase option, (c) the lease term is at least 75% of the property’s estimated remaining economic life, or (d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the lessor at the inception date. A capital lease is accounted for as if there was an acquisition of an asset and an incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases. The Company had no capital leases for any of the periods presented.

i) Revenue recognition

The Company derives its revenue primarily from the sales of milled rice. The Company recognizes revenue, net of value added taxes, upon delivery for sales, at which time title passes to the customer when all the following criteria are met: no uncertainties regarding customer acceptance; persuasive evidence of an arrangement exists; the sales price is fixed and determinable; and collectability is deemed probable.

j) Government subsidies

Government subsidies are recorded as deferred revenue when received and recognized as other operating income over the periods in which the Company recognizes related costs for which the subsidies are intended to compensate or there is reasonable assurance that the Company has complied with all conditions attached to the subsidies. For government subsidies relating to the acquisition of machinery and equipment, they are recognized, amortized and matched with the useful life of the machinery and equipment acquired.

The Company receives government subsidies in the form of funds for research and development activities and machinery and equipment acquisition. Government subsidies recognized as other operating income for the years ended December 31, 2008, 2009 and 2010 were $147, $126 and $81, respectively. The deferred revenue related to government subsidies not yet recognized as of years ended December 31, 2009 and 2010 were $7 and $8, respectively.

k) Cost of revenues

Cost of revenues consists of expenses directly related to rice sales, including material costs, depreciation and amortization, rental and related expenses, which are directly attributable to the production of rice products. Write-down of inventory to lower of cost or market is also recorded in cost of revenues in the consolidated statement of income when the carrying value of inventory is in excess of market value.

F-14

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

l) Research and development costs

Research and development costs relating to the development of new products and processes, including significant improvements and refinements to existing products, are expensed as incurred. For the years ended December 31, 2008, 2009 and 2010, research and development costs were $13, $16 and $24, respectively.

m) Advertising costs

Advertising costs are expensed when incurred and included in selling expenses.  For the years ended December 31, 2008, 2009 and 2010, advertising costs were $78, $38 and $120, respectively.

n) Shipping and handling costs

The Company includes shipping and handling costs as either cost of goods sold or selling expenses depending on the nature of the expenses. Shipping and handling costs which relate to transportation of products to customers’ locations are charged to selling expenses, while those which relate to the transportation of rice grains from suppliers’ to the Company’s production facilities and from a Company’s production facility to another are charged to cost of revenues.

For the years ended December 31, 2008, 2009 and 2010, shipping and handling costs included in selling expenses were $215, $282 and $457, respectively.

o) Allowance for doubtful accounts

The Company regularly monitors and assesses the risk of not collecting amounts owed to the Company by customers. This evaluation is based upon a variety of factors including an analysis of amounts current and past due along with relevant history and facts peculiar to each customer. Based upon such evaluation, the Company records an allowance for uncollectible accounts to cover this risk.

As of December 31, 2008, 2009, 2010, the Company considered all its accounts receivable to be collectable and no provision for doubtful accounts was made in the consolidated financial statements.

F-15

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

p) Income taxes

Deferred income taxes are recognized for the future tax consequences of temporary differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements, net of operating loss carry forwards and credits. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant tax authorities.

The Company has adopted the provisions of ASC No. 740 “Income Taxes” (“ASC 740”), which clarifies the accounting for uncertainty in income taxes recognized by prescribing a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides accounting guidance on de-recognition, classification, interest and penalties, disclosure and transition.

q) Foreign currency translation

The functional and reporting currency of Grand Farm and the Company’s subsidiary located outside the PRC is the United States dollar (“U.S. dollar”). The financial records of the Company’s subsidiary and VIE located in the PRC are maintained in their local currency, the Renminbi (“RMB”), which is the functional currency of these entities.

Monetary assets and liabilities denominated in currencies other than Grand Farm’s functional currency are translated into U.S. dollar at the rates of exchange ruling at each balance sheet date. Transactions in currencies other than the Grand Farm’s functional currency during each year are converted into U.S. dollar at the applicable rates of exchange prevailing when the transactions occurred. Transaction gains and losses are recognized in the statements of operations.

The Company’s subsidiary and VIE located in the PRC translate their operating results and financial position into the U.S. dollar, Grand Farm’s reporting currency. Assets and liabilities are translated using the exchange rates in effect on each balance sheet date. Revenues, expenses, gains and losses for each year are translated using the average rate for such year. Translation adjustments are reported as cumulative translation adjustments and are shown as a separate component of other comprehensive income.

r) Comprehensive income

Comprehensive income is defined to include all changes in equity except those resulting from investments by owners and distributions to owners. Comprehensive income for the years presented has been disclosed within the combined statements of income and comprehensive income.

F-16

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

s) Net income per share

Basic net income per share is computed by dividing net income by the weighted average number of ordinary shares outstanding during the periods presented. Diluted net income per share gives effect to all dilutive potential ordinary shares outstanding during the periods presented. The weighted average number of ordinary shares outstanding is adjusted to include the number of additional ordinary shares that would have been outstanding if the dilutive potential ordinary shares had been issued. In computing the dilutive effect of potential ordinary shares, the average stock price for each period presented is used in determining the number of treasury shares assumed to be purchased with the proceeds from the exercise of options. There were no dilutive effect of potential ordinary shares and number of ordinary shares outstanding is equivalent to the weighted average number of ordinary shares outstanding for each of the three years ended December 31, 2010.

t) Fair value measurement

The Company has adopted ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. It does not require any new fair value measurements, but provides guidance on how to measure fair value by providing a fair value hierarchy used to classify the source of the information.

It establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable inputs, which may be used to measure fair value and include the following:

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement.

F-17

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

u) Recent changes in accounting standards

In January 2010, the FASB issued ASU 2010-06, “Fair Value Measurements and Disclosure (Topic 820): Improving Disclosures about Fair Value Measurements (“ASU 2010-06”). ASU 2010-06 amends ASC Topic 820 to require additional disclosures regarding fair value measurements. One of the areas concerned is related to the inclusion of information about purchases, sales, issuances and settlements in the reconciliation of recurring Level 3 measurements. Such disclosure requirements will be effective for annual reporting periods beginning after December 15, 2010 and for interim periods within those fiscal years. The Company evaluated the effect of ASC 2010-06 on its financial statements and believes that this ASU is only related to disclosures and would have no impact on its financial positions, results of operation and cash flows. 

In April 2010, the FASB issued ASU 2010-13, “Effect of Denominating the Exercise Price of a Share-Based Payment Award in the Currency of the Market in Which the Underlying Equity Security Trades” (“ASU 2010-13”). It addresses the classification of a share-based payment award with an exercise price denominated in the currency of a market in which the underlying equity security trades. FASB ASC Topic 718, “Compensation—Stock Compensation”, was amended to clarify that a share-based payment award with an exercise price denominated in the currency of a market in which a substantial portion of the entity’s equity securities trade shall not be considered to contain a market, performance or service condition. Therefore, such an award is not to be classified as a liability if it otherwise qualifies for equity classification. The amendments will be effective for fiscal years, and interim reporting periods within those fiscal years, beginning on or after December 15, 2010, with early application permitted. The Company evaluated the effect of ASU 2010-13 on its financial statements and has concluded that it would have no impact on its financial positions, results of operation and cash flows.

F-18

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

3. RELATED PARTY BALANCES AND TRANSACTIONS

(a) List of related parties is as follows:

Name of related parties	Relationship
Mr. Yao	The Founder and Chairman of the Company
Mr. Jianxin Yao	Brother of Mr. Yao
Ms. Suzhen Wang (“Ms. Wang”)	Wife of Mr. Yao
Panjin Jiahong Industrial Co., Ltd. (“Panjin Jiahong”)	Entity for whom Mr. Jianxin Yao acted as legal representative prior  to September 13, 2010
Putian Kaili Trading Co., Ltd.  (“Putian Kaili”)	Entity controlled by Ms. Wang and Mr. Jianxin Yao
Dawa Mingshi Food Trading Co., Ltd. (“Dawa Mingshi”)	Entity controlled by and for whom Mr. Jianxin Yao acted as legal representative prior  to September 13, 2010

(b) Amounts due from related parties as of December 31, 2009 and 2010 are as follows:

	Note	December 31
		2009		2010
Panjin Jiahong	(i)	$	4,371	$	-
Ms. Wang	(ii)		28		-
Putian Kaili	(iii)		1,114		-
		$	5,513	$	-

Note (i): The balance as of December 31, 2009 represented advance payments to Panjin Jiahong for purchase of raw material, which were unsecured, interest-free and repayable on demand. Since September 13, 2010, advance payments to Panjin Jiahong were re-classified as advances to suppliers.

Note (ii): The balance as of December 31, 2009 represented cash advance to Ms. Wang for expenses incurred for the Company, which was unsecured, interest-free and repayable on demand.

Note (iii): The balance as of December 31, 2009 represented short-term loan made to Putian Kaili, which was unsecured, interest-free and matured within 3 months.

F-19

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

3. RELATED PARTY BALANCES AND TRANSACTIONS - Continued

(c) Amount due to a  related party as of December 31, 2009 and 2010 is as follows:

	Note	December 31,
		2009			2010
Mr. Yao	(iv)		$	-		$	808

Note (iv): The balance as of December 31, 2010 represented capital injection into Putian Asia Succes  and expenses incurred for the year paid by Mr. Yao on behalf of the Company, which was unsecured, interest-free and repayable on demand.

(d) Transactions with related parties for the years ended December 31, 2008, 2009 and 2010 are as follows:

	Note	Year ended December 31,
		2008		2009		2010
Purchase from
Panjin Jiahong	(v)	$	10,756	$	4,368	$	4,489
Loans to
Putian Kaili	(vi)		-		3,250		812
Ms. Wang	(viii)		-		-		3,821
Loans from
Putian Kaili	(vi)		-		6,459		9,431
Dawa Mingshi	(vii)		-		-		7,282
Ms. Wang	(viii)		-		-		150
Maximum yearly balances of bank loans secured by related parties	(ix)	$	10,235	$	16,661	$	16,199

Note(v): Since September 13, 2010, purchases from Panjin Jiahong were not regarded as related party transactions.

Note(vi): The Company and Putian Kaili made loans to and from each others. The loans were unsecured, interest-free and repayable within 3 months.

Note(vii): Dawa Mingshi made loans to the Company. The loans were unsecured, interest-free and repayable within 3 months.

Note(viii): The Company and Ms. Wang made loans to and from each others. The loans were unsecured, interest-free and repayable within 3 months.

F-20

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

3. RELATED PARTY BALANCES AND TRANSACTIONS - Continued

(d) Transactions with related parties for the years ended December 31, 2008, 2009 and 2010 are as follows: - Continued

Note(ix): Mr. Yao and Mr. Jianxin Yao provided guarantees for certain unsecured short-term and long-term bank loans of the Company for the years ended December 31, 2008, 2009 and 2010. Ms. Wang provided guarantees and Panjin Jiahong pledged its assets, for certain unsecured short-term and long-term bank loans of the Company for the years ended December 2008 and 2009. The maximum balances of these loans in the aggregate were $10,235, $16,661 and $16,199 for the years ended December 31, 2008, 2009 and 2010 respectively.

4. ADVANCES TO SUPPLIERS

Advances to suppliers mainly represent deposits paid for raw materials which had not been delivered as of the periods presented. Advances to suppliers as of December 31, 2009 and 2010 were $4,366 and $18,126, respectively. Since September 13, 2010, advance payment to Panjin Jiahong (note 3) was re-classified as advances to suppliers. As of December 31, 2010 advance payment to Panjin Jiahong was $3,658.

5. INVENTORIES

Inventories consist of the following:

	December 31,
	2009		2010
Raw material	$	11,175	$	8,116
Work-in-progress		627		307
Finished goods		5,281		491
Total inventories	$	17,083	$	8,914

6. PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets consist of the following:

	Note	December 31,
		2009		2010
Loans to other debtors	(i)	$	216	$	-
Prepaid expenses			409		973
Value-added tax recoverable			149		-
Others			24		39
Total prepaid expenses and other current assets		$	798	$	1,012

Note(i): Loans to other debtors were unsecured, interest-free and repayable on demand.

F-21

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

7. LAND USE RIGHTS, NET

Land use rights consist of the following:

	December 31,
	2009			2009
Land use rights	$	473		$	490
Accumulated amortization		(44	)		(56	)
Land use rights, net	$	429		$	434

Land use rights with carrying value of $429 and $434 as of December 31, 2009 and 2010, respectively, were pledged as collateral for bank loans as of such dates.

Amortization expenses for the years ended December 31, 2009 and 2010 were $9, $9 and $12, respectively.

8. PROPERTY, PLANT AND EQUIPMENT, NET

Property, plant and equipment consist of the following:

	December 31,
	2009			2010
Plant and building	$	4,060		$	4,198
Machinery and equipment		2,013			3,043
Furniture and office equipment		113			231
Electronic equipment		114			100
Motor vehicles		276			931
Total		6,576			8,503
Less: Accumulated depreciation		(1,111	)		(1,532	)
		5,465			6,971
Construction-in-progress		236			2,930
Property, plant and equipment, net	$	5,701		$	9,901

Certain assets included in property, plant and equipment, with carrying value of $3,268 and $3,192 as of December 31, 2009 and 2010, respectively, were pledged as collateral for bank loans as of such dates. Depreciation expenses for the years ended December 31, 2008, 2009 and 2010 were $307, $315, and $368, respectively (note 16).

Construction-in-progress refers to production facilities under construction (note 16).

F-22

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

9. BORROWINGS

	December 31,
	2009		2010
Short-term borrowings	$	14,655	$	16,199
Long-term borrowings	$	224	$	232

a) Short-term borrowings

As of December 31, 2009, short-term borrowings comprised of secured bank loans of $12,455, and unsecured bank loans of $2,200. $10,123 of the secured loans were secured by the Company’s land use rights in the amount of $429 (note 7), and property, plant and equipment in the amount of $3,268 (note 8), $1,452 by the Company’s accounts receivable of $1,197, and the remaining $880 by the assets of Panjin Jiahong. Interest rate ranged from 5.310% to 6.107% per annum.

As of December 31, 2010, all the short-term borrowings were secured bank loans. $3,899 of the loans were secured by the Company’s land use rights in the amount of $434 (note 7), and property, plant and equipment in the amount of $3,192 (note 8), $1,029 by the Company’s accounts receivable of $992, and the remaining $11,271 secured by the assets of Mr. Yao, Mr. Jianxin Yao and Putian Jia Jia Food Industry Co., Ltd. Interest rate was 5.56% per annum.

Interest expenses and weighted average interest rates for the years ended December 31, 2008, 2009 and 2010 were $951 and 8.10%, $860 and 5.77%, and $847 and 5.56%, respectively.

b) Long-term borrowings

As of December 31, 2009, long-term borrowings comprised of bank loans of $112 due on October 30, 2012, and $112 due on October 30, 2013. As of December 31, 2010, long-term borrowings comprised of bank loans of $116 due on October 30, 2012, and $116 due on October 30, 2013, both bearing interest at 7.2% per annum. Both loans are guaranteed by Mr. Yao. The difference between the amounts as of December 31, 2009 and 2010 were related to exchange difference.

c) Banking facilities

At December 31, 2009 and 2010, the Company had banking facilities totaling $5,868 (equivalent to RMB 40 million) and $6,068 (equivalent to RMB 40 million), respectively, of which $4,125 and $2,005 had not yet been utilized were available to the Company as of such dates with no additional collateral pledged, respectively.

F-23

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

10.  OTHER PAYABLES AND ACCRUED EXPENSES

Other payables and accrued expenses consist of:

	December 31,
	2009		2010
Salaries payable	$	80	$	61
Accrued expenses		80		714
Total other payables and accrued expenses	$	160		775

11. INCOME TAXES

Grand Farm is incorporated in the Cayman Islands and is not subject to tax on income or capital gain.

Asia Success is incorporated in Hong Kong and is subject to statutory tax rate of 16.5%.

Putian Asia Success and the VIE, Fujian Grand Farm, are both incorporated in the PRC and subject to the PRC Enterprise Income Tax (“EIT”).

Prior to January 1, 2008, the standard PRC EIT rate was 33% of assessable profit, of which 30% is for national tax and 3% is for local tax. From January 1, 2008, with the effect of the new PRC EIT Law, the standard EIT rate for all PRC companies has been reduced to 25%.

On November 20, 2008, the State Administration of Taxation issued the Notice Regarding Preferential Enterprise Income Tax On Primary Processing of Agricultural Products (“Circular 2008-149”) which grants EIT exemption to businesses primarily engaged in processing agricultural products except refined rice bran oil, effective retroactively from January 1, 2008.  Circular 2008-149 currently has no expiration date.  As a consequence of Circular 2008-149, Fujian Grand Farm has been exempted from the EIT since January 1, 2008, because its rice processing business meets the requirements of Circular 2008-149.

F-24

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

11. INCOME TAXES - Continued

Provision for income tax expense (benefit) consists of the following:

	Years ended December 31,
	2008			2009			2010
Current tax	$	5		$	5		$	7
Deferred tax		(2	)		(32	)		(28	)
Income tax expense (benefit)	$	3		$	(27	)		(21	)

Reconciliation between income tax expense (benefit) and the amount computed by applying the standard EIT rate to income before income tax expense (benefit) is as follows:

	Years ended December 31,
	2008			2009			2010
Provision for income taxes at statutory tax rate in China (2008:25%, 2009:25% and 2010:25%)	$	1,236		$	3,011		$	3,518
Tax concessions		(1,260	)		(3,068	)		(3,736	)
Effect of non-deductible expenses		30			31			193
Others		(3	)		(1	)		4
Income tax expense (benefit)	$	3		$	(27	)		(21	)

Had none of the above tax concessions been available, the tax charge would have been higher by $1,260, $3,068 and $3,736 and the basic and diluted net income per share would have been lower by $0.05, $0.12 and $0.15 for the years ended December 31, 2008, 2009 and 2010, respectively.

The Company adopted ASC Topic 740-10-05, “Income Taxes”. To date, the adoption of this interpretation has not impacted the Company’s financial condition, results of operations, or cash flows. The Company performed self-assessment and the Company’s liability for income taxes includes the liability for unrecognized tax benefits, interest and penalties which relate to tax years still subject to review by taxing authorities. Audit periods remain open for review until the statute of limitations has passed, which in the PRC is usually 5 years. The completion of review or the expiration of the statute of limitations for a given audit period could result in an adjustment to the Company’s liability for income taxes. Any such adjustment could be material to the Company’s results of operations for any given quarterly or annual period based, in part, upon the results of operations for the given period.

F-25

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

11. INCOME TAXES - Continued

Management considered that the Company had no uncertain tax positions affecting its consolidated financial position and results of operations or cash flows through December 31, 2010, and will continue to evaluate for uncertain position in future. There are no estimated interest costs and penalties provided in the Company’s consolidated financial statements for the years ended December 31, 2008, 2009 and 2010, respectively. The Company’s tax positions related to open tax years are subject to examination by the relevant tax authorities and the major one is the China Tax Authority.

The principal components of deferred income tax assets are as follows:

	December 31,
	2009		2010
Temporary difference arising from depreciation charges	$	7	$	8
Temporary difference arising from government grant		22		21
Temporary difference arising from accrued lease expenses		10		41
Non-current deferred income tax assets, net	$	39		70

The deferred income tax assets recognized as of December 31, 2009 and 2010 relate to temporary difference on depreciation charges, deferred income on government subsidies and temporary difference on accrued lease expenses of Fujian Grand Farm. The Company operates through Fujian Grand Farm and does not have net operating loss carried forward.

The new PRC EIT Law and its relevant regulations also impose a withholding tax of 10%, unless reduced by a tax treaty, for dividends distributed by a PRC resident enterprise to its immediate holding company outside the PRC for earnings accumulated beginning on January 1, 2008. Undistributed earnings generated prior to January 1, 2008 are exempt from such withholding tax. The Company has not provided for income taxes on undistributed earnings, if any, of its PRC subsidiary and VIE as of December 31, 2009 and 2010 since these earnings are intended to be reinvested indefinitely in the PRC. Accordingly, no deferred taxation on undistributed earnings of the PRC subsidiary and VIE has been recognized as of December 31, 2009 and 2010.

F-26

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

12. INCOME PER SHARE

Income per share has been computed as if the VIE Agreements (note 1) had been in existence throughout the years presented, and the 500-for-1 forward share split carried out by Grand Farm in September 2010 (note 13) had been completed throughout the years presented.
 

The following table sets forth the computation of basic and diluted income per share for the years indicated:

	Years ended December 31,
	2008		2009		2010
Numerator:
Net income, basic and diluted	$	4,941	$	12,071	$	14,095
Denominator:
Ordinary shares (denominator), basic and diluted (shares in thousands)		25,000		25,000		25,000
Weighted average ordinary shares (in thousands) outstanding used in computing basic income per share		25,000		25,000		25,000
Net income per share, basic and diluted	$	0.20	$	0.48	$	0.56

There were no dilutive ordinary shares outstanding during the years ended December 31, 2008, 2009 and 2010.

13. ORDINARY SHARES

Upon incorporation in June 2010, Grand Farm’s authorized share capital was initially set at $50,000, consisting of 50,000 ordinary shares with a par value of $1.00 per share, all of which were issued to eight shareholders, including Sunlight Blaze which the Founder controls.

On October 1, 2010, Grand Farm carried out a 500-for-1 forward share split and an increase in authorized capital to $200,000 consisting of 100,000,000 ordinary shares having a par value of $0.002 per share. As a result, the number of authorized shares increased from 50,000 to 100,000,000 with par value changing from $1.00 per share to $0.002 per share, and the number of issued and outstanding shares changed from 50,000 shares with a par value of $1.00 per share to 25,000,000 shares with a par value of $0.002 per share.

The ordinary shares are presented as if the VIE Agreements had been in existence throughout the years presented as Grand Farm and Fujian Grand Farm are deemed to be under common control since October 23, 2006 and the 500-for-1 forward share split carried out by Grand Farm on October 1, 2010  had been completed throughout the years presented.

F-27

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

14. EMPLOYEE BENEFIT PLAN AND PROFIT APPROPRIATION

Full time employees in the PRC participate in a government mandated multi-employer defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to employees. Chinese labor regulations require the Company to accrue for these benefits based on certain percentages of its employees’ salaries. The total provisions for such employee benefits were $29, $33 and $83 for the years ended December 31, 2008, 2009 and 2010, respectively.

In addition, pursuant to applicable PRC laws, companies established in the PRC, such as Fujian Grand Farm and Putian Asia Success, must make appropriations from after-tax profit to non-distributable reserves funds including: (i) the statutory surplus reserve and (ii) the statutory public welfare fund. Subject to a limit of 50% of a company’s registered capital, the statutory surplus reserve fund requires annual appropriations of 10%, and the statutory public welfare fund requires annual appropriations of 5%, of the company’s after-tax profit (as determined under accounting principles generally accepted in the PRC at each year-end). In accordance with regulations which became effective January 1, 2006, appropriation to the statutory public welfare fund is no longer required. These reserve funds may be applied against prior year losses, if any, and may be used for general business expansion and production and increase in registered capital of subsidiary or VIE in the PRC but are not distributable as cash dividends.

As of December 31, 2008, 2009 and 2010, Fujian Grand Farm’s statutory surplus reserve was $769, $1,976 and $2,901, respectively. As it has met its statutory surplus reserve requirement, no further appropriation is required. On the other hand, as Putian Asia Success had minimal after-tax net profit from its incorporation date of September 19, 2010 to December 31, 2010, no appropriation to its statutory surplus reserve was made.

15. DIVIDENDS

On December 30, 2010, dividends of $10,000 in the aggregate, equivalent to 52% of unappropriated earnings of Fujian Grand Farm as of December 31, 2009, were distributed to the Original Equity Owners (note 1). Specifically, $9,975 was distributed to Mr. Yao and $25 to Mr. Jianxin Yao, pro rata to their respective ownership percentage in Fujian Grand Farm.

F-28

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

16. COMMITMENTS AND CONTINGENCIES

a) Capital commitments

Capital commitments for the purchase of machineries and construction-in-progress are as follows:

	December 31,
	2008		2009		2010
Plant & Machinery Machineries (note 8)	$	-	$	3,305	$	103
Construction-in-progress (note 8)		276		40		38
	$	276	$	3,345	$	141

b) Operating lease

The Company is leasing factory and office premises under operating lease from July 1, 2009 to December 31, 2020. During 2010, the operating lease was revised and extended to December 31, 2028. Rental expenses under operating leases for the years ended December 31, 2008, 2009 and 2010 were $Nil, $40, and $107, respectively.

The Company was obligated under operating lease requiring minimum rental as follows:

	December 31,
	2010
2010 (i)	$	-
2011		76
2012		79
2013		84
2014		88
2015		92
Thereafter		1,715
Total	$	2,134

Note (i): Rent-free period under the operating lease is July 1, 2009 to December 31, 2010.

17. FAIR VALUE OF FINANCIAL INSTRUMENT

The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, bills payable and other payables and accrued expenses,  approximate their fair values because of the short maturity of these instruments and market rates of interest.

F-29

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

18. SEGMENT AND GEOGRAPHIC INFORMATION

The Company has two major processing lines for the production of rice and related products, which have been organized as one operating segment. The Company’s chief operating decision maker, its Chief Executive Officer, receives and reviews the results of operation for all of its rice products as a whole when making decisions about allocating resources and assessing performance of the Company, since they have similar nature and production procedures, with similar economic characteristics. Accordingly, the Company believes it operates in one operating segment.

The components of revenues are as follows:

	Years ended December 31,
	2008			2009			2010
Short/medium-grain rice	$	29,682		$	43,328		$	56,231
Long-grain rice		1,980			4,381			12,796
Nutrient-fortified rice		2,140			9,474			8,878
Rice milling by-products		2,707			3,775			4,772
Business tax		(502	)		(425	)		(488	)
Total revenues	$	36,007		$	60,533		$	82,189

The Company’s sales and all of the Company’s long-lived assets are located in the PRC.

19. OPERATING RISK

a) Concentrations of credit risk

The Company's products are typically sold to its customers on an open account or cash basis.  No single customer accounted for 10% or more of total net sales for each of the two years ended December 31, 2008 and 2009. Except for one customer who accounted for 12% of total net sales, no other customers individually accounted for 10% or more of total net sales for the year ended December 31, 2010.

Percentage of the total accounts receivable from the five customers with the largest receivable balances as at December 31, 2009 and 2010, respectively, to total accounts receivable as at such dates, are as follows:

	December 31,
	2009			2010
Percentage of total receivable balances from the top 5 customers to total accounts receivable		22.55	%		22.80	%

There was no indication of provision for bad debt being noted for these five customers as at December 31, 2009 and 2010, respectively.

F-30

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

20. OPERATING RISK - Continued

b) Concentration of major suppliers

For the year ended December 31, 2008, the Company had three major suppliers which accounted for 28%, 13% and 4% of total purchases, respectively. For the year ended December 31, 2009, the Company had three major suppliers which accounted for 10%, 10% and 9% of total purchases, respectively. For the year ended December 31, 2010, the Company had three major suppliers which accounted for 18%, 8% and 6% of total purchases, respectively. The Company does not believe that it is subject to any material risk of supplier concentration.

c) Country risk

The Company has significant investments in PRC. The operating results of the Company may be adversely affected by changes in the political and social conditions in PRC and by changes in Chinese government policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance.

21. SUBSEQUENT EVENT

The Company has evaluated all events subsequent to the balance sheet date of December 31, 2010 through April 7, 2011, the date the consolidated financial statements were available to be issued. The management of the Company does not believe any subsequent events have occurred that would require further disclosure or adjustment to the financial statements.

22. CONDENSED FINANCIAL INFORMATION OF GRAND FARM

The condensed financial statements of Grand Farm have been prepared in accordance with accounting principles generally accepted in the United States of America.  Under the PRC laws and regulations, Grand Farm’s PRC subsidiary and VIE are restricted in their ability to transfer certain of their net assets to Grand Farm in the form of dividend payments, loans or advances. The amounts restricted include paid-in capital and statutory reserves, as determined pursuant to PRC generally accepted accounting principles, totaling $7,884 (equivalent to RMB 54 million) and $9,602 (equivalent to RMB 63 million) as of December 31, 2009 and 2010, respectively.

F-31

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

22. CONDENSED FINANCIAL INFORMATION OF GRAND FARM - Continued

Balance sheets
	December 31,
	2010
Assets
Non-Current assets
Investments in subsidiaries and VIE	$	32,451
Total assets	$	32,451
Liabilities and shareholders’ equity
Current liabilities
Other payables and accrued expenses	$	270
Amount due to a related party		248
Amount due to a subsidiary		1
Total liabilities		519
Shareholders’ equity
Ordinary shares, $0.002 par value - 100,000,000 shares authorized, 25,000,000 shares issued and outstanding		50
Additional paid-in-capital		5,017
Retained earnings		24,217
Accumulated other comprehensive income		2,648
Total shareholders’ equity		31,932
Total liabilities and shareholders’ equity	$	32,451

Statements of income and comprehensive income
	December 31,
	2010
Revenue	$	-
Cost of revenue		-
Gross profit		-
Operating expenses:
General and administrative		(568	)
Operating loss		(568	)
Equity in profit of subsidiaries and VIE		14,663
Income before income tax		14,095
Income tax		-
Net income		14,095
Foreign currency translation adjustment		1,235
Net income attributable to ordinary shareholders	$	15,330

F-32

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

22. CONDENSED FINANCIAL INFORMATION OF GRAND FARM - Continued

Statements of cash flows
	Years ended December 31,
	2010
Cash flows from operating activities
Net income	$	14,095
Adjustment to reconcile net income to net cash used in operating activities:
Equity in profit of subsidiaries and VIE		(14,663	)
Changes in operating assets and liabilities:
Other payables and accrued expenses		270
Amount due to a related party		248
Amount due to a subsidiary		1
Net cash used in operating activities		(49	)
Cash flows from investing activities
Investment in a subsidiary		(1	)
Net cash used in investing activities		(1	)
Cash flows from financing activities
Proceeds from issuance of ordinary shares		50
Net cash provided by  financing activities		50
Net increase in cash and cash equivalents		-
Cash and cash equivalents, At beginning of the period		-
Cash and cash equivalents, At end of the period	$	-

F-33

GRAND FARM INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(U.S. dollars in thousands, except share and per share data)

22. CONDENSED FINANCIAL INFORMATION OF GRAND FARM - Continued

a) Basis of presentation

In Grand Farm-only financial statements, Grand Farm’s investments in subsidiaries and VIE are stated at cost plus its equity interest in undistributed earnings of subsidiaries and VIE since inception.  Accordingly, such financial statements should be read in conjunction with the Company’s consolidated financial statements.

Grand Farm records its investments in its subsidiaries and VIE under the equity method of accounting as prescribed in APB Opinion No. 18, “The Equity Method of Accounting for Investments in Common Stock”, as codified in ASC 323 “Investment-Equity Method and Joint Ventures” (“ASC 323”).  Such investment is presented on the balance sheet as “Investments in subsidiaries and VIE” and share of the subsidiaries’ and VIE’s profit or loss as “Equity in profit (loss) of subsidiaries and VIE”, net on the statements of operations.

The subsidiaries and VIE did not pay any dividends to Grand Farm for the period presented.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted.

b) Related party transactions

For the period ended December 31, 2010, related party transactions mainly composed of $1, transferred to Asia Success as capital injection and $248 of expenses incurred for the year paid by Mr. Yao on behalf of Grand Farm, which was unsecured, interest-free and repayable on demand.

F-34

American Depositary Shares

GRAND FARM INC.

PROSPECTUS

Newbridge Securities Corporation

Through and including           , 2011 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.

Part II

INFORMATION NOT REQUIRED IN THE PROSPECTUS

Item 6.   Indemnification of directors and officers

Reference is made to the underwriting agreement, the proposed form of which is filed as Exhibit 1.1, which contains certain provisions for the indemnification by the underwriters of the Registrant and the Registrant’s directors and officers who signed the registration statement against certain civil liabilities under the Securities Act.

Grand Farm Cayman’s Memorandum and Articles of Association provides that members of our board of directors shall be indemnified and secured harmless out of our assets and profits from and against all actions, costs, charges, losses, damages and expenses which they or any of them, their or any of their heirs, executors or administrators, shall or may incur or sustain by or by reason of any act done, concurred in or omitted in or about the execution of their duty, or supposed duty, in their respective offices, provided that such indemnity shall not extend to any matter in respect of any fraud or dishonesty which may attach to any of said persons.

This provision, however, will not eliminate or limit liability arising under federal securities laws.  Grand Farm Cayman’s Memorandum and Articles of Association does not eliminate our director’s fiduciary duties.  The inclusion of the foregoing provision may, however, discourage or deter shareholders or management from bringing a lawsuit against directors even though such an action, if successful, might otherwise have benefited Grand Farm Cayman and our shareholders.  This provision should not affect the availability of a claim or right of action based upon a director’s fraud or dishonesty.

Cayman Islands law provides that a corporation may indemnify its directors and officers as well as its other employees and agents against judgments, fines, amounts paid in settlement and expenses, including attorney fees, in connection with various proceedings, except where there has been fraud or dishonesty or willful neglect or willful default.  Grand Farm Cayman’s Memorandum and Articles of Association provide that we will indemnify our directors and officers from and against all actions, costs, charges, losses, damages and expenses which they or any of them, their or any of their heirs, executors or administrators, shall or may incur or sustain by or by reason of any act done, concurred in or omitted in or about the execution of their duty, or supposed duty, in their respective offices or trusts, provided that such indemnity shall not extend to any matter in respect of any fraud or dishonesty which may attach to any of said persons.

Item 7.   Recent sales of unregistered securities

During the past three years, we have issued and sold the securities described below without registering the securities under the Securities Act. None of these transactions involved any underwriters’ underwriting discounts or commissions, or any public offering. We believe that each of the following issuances was exempt from registration under the Securities Act in reliance on Regulation S or Rule 701 under the Securities Act or pursuant to Section 4(2) of the Securities Act regarding transactions not involving a public offering.

Grand Farm Cayman was incorporated in the Cayman Islands on June 30, 2010.  Our authorized share capital was initially set at $50,000, consisting of 50,000 ordinary shares with a par value of $1 per share which were issued to 8 individual shareholders. Of these total number of shares, 42,500 shares were issued to Sunlight Blaze Holdings Limited for which Jiansan Yao, our Chairman of the Board of Director, is the controlling shareholder; 1,500 shares were issued to Mascot Sun Limited for which Chaotang Li, our Strategic Development Director as well as a director on our board, is the sole shareholder; and the remaining 6,000 shares were issued to six other shareholders, none of whom are employed by us.

Pursuant to a board resolution and a shareholders’ resolution dated on October 1, 2010, we carried out a 500-for-1 forward share split and an increase in authorized capital to $200,000 consisting of 100,000,000 ordinary shares having a par value of $0.002 per share. As a result, the number of authorized shares increased from 50,000 to 100,000,000 with par value changing from $1 per share to $0.002 per share, and the number of issued and outstanding shares changed from 50,000 shares with a par value of $1 per share to 25,000,000 shares with a par value of $0.002 per share.

At the time of the issuances of these securities, Grand Farm Cayman was not a reporting company in the United States.  The offer and sale of these securities was to non-US persons outside of the United States; therefore, these securities were exempt from registration.

Item 8.   Exhibits and financial statement schedules

a.           Exhibits

Incorporated by reference to the Exhibit Index following Page II-2 hereof.

b.           Financial Statement Schedules

Schedules have been omitted because the information required to be set forth therein is not applicable or is shown in the Financial Statements or the Notes thereto.

Item 9.   Undertakings

The registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

The registrant hereby undertakes that:

(i) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

(ii) For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Putian, Fujian Province, People’s Republic of China, on May 12, 2011.

GRAND FARM INC.
By:	/s/ Kaigang Cheng
	Name: Kaigang Cheng
	Title: Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Kaigang Cheng and Biyun Huang, in their individual capacity, as their true and lawful attorney-in-fact, with full power of substitution and resubstitution for their and in their name, place and stead, in any and all capacities to sign any and all amendments including post-effective amendments to this registration statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorney-in-fact or their substitute, each acting alone, may lawfully do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities indicated on May 12, 2011.

Signature	Capacity
/s/ Kaigang Cheng	Chief Executive Officer
Name: Kaigang Cheng	(Principal Executive Officer)
/s/ Biyun Huang	Chief Financial Officer
Name: Biyun Huang	(Principal Accounting and Financial Officer)
/s/ Jianshan Yao	Director
Name: Jianshan Yao
/s/ Chaotang Li	Director
Name: Chaotang Li
/s/ Qinglong Li	Director
Name: Qinglong Li
/s/ Feng Liang	Director
Name: Feng Liang

SIGNATURE OF AUTHORIZED REPRESENTATIVE IN THE UNITED STATES

Pursuant to the Securities Act of 1933, the undersigned, the duly authorized representative in the United States of Grand Farm Inc., has signed this registration statement or amendment thereto in Newark, Delaware, on May 12, 2011.

Puglisi & Associates
By:	/s/ Donald J. Puglisi
	Name: Donald J. Puglisi
	Title: Managing Director

EXHIBIT INDEX

Exhibit No.		Description
1.1		Form of Underwriting Agreement
3.1		Amended and Restated Memorandum and Articles of Association of Grand Farm Inc.
4.1	(1)	Registrant’s Specimen American Depositary Receipt (included in Exhibit 4.3)
4.2		Registrant’s Specimen Certificate for Ordinary Shares
4.3	(1)	Form of Deposit Agreement, among the Registrant, the depositary and holder of the American Depositary Receipts
4.4		Form of Underwriter’s Warrant
5.1		Opinion of Forbes Hare regarding the validity of the ordinary shares being offered hereby
8.1		Form of Opinion of Forbes Hare regarding certain Cayman Islands tax matters
8.2		Form of Opinion of LKP Global Law, LLP regarding certain U.S. federal tax matters
8.3		Form of Opinion of B&D Law Firm regarding certain PRC tax matters
10.1		Exclusive Technical Consulting Service Agreement between Grand Farm WFOE and Grand Farm China dated September 25, 2010
10.2		Operating Agreement between Grand Farm WFOE and Grand Farm China dated September 25, 2010
10.3		Exclusive Equity Interest Purchase Agreement among Grand Farm WFOE, Grand Farm China and Jianshan Yao dated September 25, 2010
10.4		Exclusive Equity Interest Purchase Agreement among Grand Farm WFOE, Grand Farm China and Jianxin Yao dated September 25, 2010
10.5		Equity Interest Pledge Agreement among Grand Farm WFOE, Grand Farm China and Jianshan Yao dated September 25, 2010
10.6		Equity Interest Pledge Agreement among Grand Farm WFOE, Grand Farm China and Jianxin Yao dated September 25, 2010
10.7		Power of Attorney of Jianshan Yao dated September 25, 2010
10.8		Power of Attorney of Jianxin Yao dated September 25, 2010
10.9	*	Employment Agreement between Grand Farm China and Kaigang Cheng dated July 1, 2010
10.10	*	Confidentiality and Non-competition Agreement between Grand Farm China and Kaigang Cheng dated April 1, 2010
10.11	*	Employment Agreement between Grand Farm China and Chaotang Li dated August 1, 2008
10.12	*	Employment Agreement between Grand Farm China and Biyun Huang dated October 1, 2010
10.13	*	Confidentiality and Non-competition Agreement between Grand Farm China and Biyun Huang dated April 1, 2010
10.14		Director Offer Letter of Qinglong Li dated November 30, 2010
10.15		Director Offer Letter of Feng Liang dated November 30, 2010
10.16	*	Grand Farm China’s Grain Food Purchase Contract with schedule in accordance with Instruction 2 to Item 601 of Regulation S-K
10.17	*	Grand Farm China’s Rice Sales Contract with schedule in accordance with Instruction 2 to Item 601 of Regulation S-K
10.18	*	Grain Food Purchasing Agency Agreement between Grand Farm China and Panjin Jiahong Industrial Co., Ltd. with Schedule in accordance with Instruction 2 to Item 601 of Regulation S-K
10.19	*	Facility Lease Agreement between Grand Farm China and Fujian Jia Jia Food Co., Ltd. dated June 15, 2009
10.20	*	Facility Lease Supplemental Agreement between Grand Farm China and Fujian Jia Jia Food Co., Ltd. dated December 8, 2010
10.21		Agreement regarding Dividend Declaration among Grand Farm WFOE, Grand Farm China, Jianshan Yao and Jianxin Yao dated December 30, 2010
21.1		List of subsidiaries
23.1		Consent of BDO Limited, independent registered public accounting firm
23.2	**	Consent of Forbes Hare (included in Exhibits 5.1 and 8.1)
23.3	**	Consent of B&D Law Firm (included in Exhibit 8.3)
23.4		Consent of Kam Por Cheng, an independent director appointee

24.1 ** Powers of Attorney (included on the signature page in Part II of this Registration Statement)

*  English translation

**  To be filed by amendment

(1) Incorporated by reference to the Registration Statement on Form F-6 to be filed with the Securities and Exchange Commission with respect to American depositary shares representing our ordinary shares.

EX-1.1

Exhibit 1.1

__________ Ordinary Shares in the Form of American Depositary Shares

GRAND FARM, INC

Ordinary Shares in the Form of American Depositary Shares

UNDERWRITING AGREEMENT

, 2011

Newbridge Securities Corporation

1451 West Cypress Creek Road

Ft. Lauderdale, Florida 33309

Ladies and Gentlemen:

Grand Farm, Inc, a company incorporated under the laws of the Cayman Islands (the “Company”), proposes, subject to the terms and conditions stated herein, to issue and sell to Newbridge Securities Corporation (“Newbridge” or the “Underwriter”) an aggregate of ___________ authorized but unissued ordinary shares (the “Underwritten Shares”), par value $0.002 per share (the “Ordinary Shares”), of the Company, and to grant the Underwriter the option to purchase an aggregate of up to ____________ additional Ordinary Shares (the “Additional Shares”) as may be necessary to cover over-allotments made in connection with the offering.  The Underwritten Shares and Additional Shares are collectively referred to as the “Shares.”

The Underwriter will take delivery of the Shares in the form of American Depositary Shares (“ADSs”).  The ADSs are to be issued pursuant to a Deposit Agreement dated as of _____________, 2011 (the “Deposit Agreement”) among the Company, Deutsche Bank AG. as Depositary (the “Depositary”) and all Holders and Owners (each as defined therein) from time to time of ADSs evidenced by American Depositary Receipts (“ADRs”) issued by the Depositary.

Each ADS will initially represent the right to receive ___ Ordinary Share(s) deposited pursuant to the Deposit Agreement.

The Company and the Underwriter hereby confirm their agreement as follows:

1.           Registration Statement and Prospectus.

(a)           The Company has prepared and filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form F-1 (File No. 333-___________) relating to the Shares under the Securities Act of 1933, as amended (the “Securities Act”) and the rules and regulations (the “Rules and Regulations”) of the Commission thereunder, and such amendments to such registration statement (including post effective amendments) as may have been required to the date of this Agreement.  Such registration statement, as amended (including any post effective amendments) has been declared effective by the Commission.  Such registration statement, including amendments thereto (including post effective amendments thereto) at such time, the exhibits and any schedules thereto at such time and the documents and information otherwise deemed to be a part thereof or included therein by the Securities Act or otherwise pursuant to the Rules and Regulations at such time, is herein called the “Registration Statement.”  If the Company has filed or files an abbreviated registration statement pursuant to Rule 462(b) under the Securities Act (the “Rule 462 Registration Statement”), then any reference herein to the term Registration Statement shall include such Rule 462 Registration Statement.

The Company is filing with the Commission pursuant to Rule 424 under the Securities Act a final prospectus supplement relating to the Shares to a form of prospectus included in the Registration Statement.  Such prospectus in the form in which it appears in the Registration Statement is hereinafter called the “Base Prospectus,” and such final prospectus supplement as filed, along with the Base Prospectus, is hereinafter called the “Final Prospectus.”  Such Final Prospectus and any preliminary prospectus supplement or “red herring,” in the form in which they shall be filed with the Commission pursuant to Rule 424(b) under the Securities Act (including the Base Prospectus as so supplemented) is hereinafter called a “Prospectus.”

(b)           The Company and the Depositary have filed with the Commission a registration statement, and amendments thereto, on Form F-6 (No. 333-__________) for the registration under the Securities Act of the ADSs, which registration statement, as so amended, has been declared effective by the Commission and copies of which have heretofore been delivered to the Underwriters.  Such registration statement, as amended at the time it became effective is hereinafter referred to as the “ADS Registration Statement.”

(c)           A registration statement on Form 8-A (File No. 001-_________) in respect of the registration of the Shares under the Exchange Act was filed with the Commission on __________, 2011, such registration statement in the form thereof delivered to the Underwriter was declared effective by the Commission in such form; no other document with respect to such registration statement has theretofore been filed with the Commission (the “Form 8-A Registration Statement”).

For purposes of this Agreement, all references to the Registration Statement, the Rule 462 Registration Statement, the ADS Registration Statement, the Form 8-A Registration Statement, the Base Prospectus, the Final Prospectus, the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Interactive Data Electronic Applications system.  All references in this Agreement to amendments or supplements to the Registration Statement, the Rule 462 Registration Statement, the ADS Registration Statement, the Form 8-A Registration Statement, the Base Prospectus, the Final Prospectus or the Prospectus shall be deemed to mean and include the subsequent filing of any document under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that is deemed to be incorporated therein by reference therein or otherwise deemed by the Rules and Regulations to be a part thereof.

2.           Representations and Warranties of the Company Regarding the Offering.

(a)           The Company represents and warrants to, and agrees with, the Underwriter, as of the date hereof and as of the Closing Date (as defined in Section 5(c) below), except as otherwise indicated, as follows:

(i)           At each time of effectiveness, at the date hereof and at the Closing Date, the Registration Statement, the ADS Registration Statement, the Form 8-A Registration Statement, and any post-effective amendment thereto complied or will comply in all material respects with the requirements of the Securities Act and the Rules and Regulations and did not and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.  The Base Prospectus, the Prospectus most recently filed with the Commission before the time of this Agreement, including any preliminary prospectus supplement deemed to be a part thereof (the “Time of Sale Disclosure Package”) as of the date hereof and at the Closing Date, and the Final Prospectus, as amended or supplemented, at the time of filing pursuant to Rule 424(b) under the Securities Act and at the Closing Date, did not and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.  The representations and warranties set forth in the two immediately preceding sentences shall not apply to statements in or omissions from the Registration Statement or any Prospectus in reliance upon, and in conformity with, written information furnished to the Company by the Underwriter specifically for use in the preparation thereof.  Each of the Registration Statement, the ADS Registration Statement and the Form 8-A Registration Statement contains all exhibits and schedules required to be filed by the Securities Act or the Rules and Regulations.  No order preventing or suspending the effectiveness or use of the Registration Statement or any Prospectus is in effect and no proceedings for such purpose have been instituted or are pending, or, to the knowledge of the Company, are contemplated or threatened by the Commission.

(ii)           The Company has not distributed any prospectus or other offering material in connection with the offering and sale of the Shares or the ADSs other than the Time of Sale Disclosure Package or other materials permitted by the Act to be distributed by the Company.  The Company has not made and will not make any offer relating to the Shares or the ADSs that would constitute an “issuer free writing prospectus”, as defined in Rule 433 under the Act, or that would otherwise constitute a “free writing prospectus”, as defined in Rule 405 under the Act, required to be filed with the Commission.

(iii)           The financial statements of the Company, together with the related notes, included or incorporated by reference in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus comply in all material respects with the applicable requirements of the Securities Act and the Exchange Act and fairly present the financial condition of the Company as of the dates indicated and the results of operations and changes in cash flows for the periods therein specified in conformity with generally accepted accounting principles consistently applied throughout the periods involved; and the supporting schedules included in the Registration Statement present fairly the information required to be stated therein.  No other financial statements, pro forma financial information or schedules are required under the Securities Act to be included or incorporated by reference in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus.  To the Company’s knowledge, BDO Limited, which has expressed its opinion with respect to the annual financial statements and schedules filed as a part of the Registration Statement and included in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus is an independent public accounting firm with respect to the Company within the meaning of the Securities Act and the Rules and Regulations.

(iv)           The Company had a reasonable basis for, and made in good faith, each “forward-looking statement” (within the meaning of Section 27A of the Act or Section 21E of the Exchange Act) contained or incorporated by reference in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus.

(v)           All statistical or market-related data included or incorporated by reference in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus are based on or derived from sources that the Company reasonably believes to be reliable and accurate, and the Company has obtained the written consent to the use of such data from such sources, to the extent required.

(vi)           The Ordinary Shares are registered pursuant to Section 12(b) of the Exchange Act, the ADSs are registered pursuant to the ADS Registration Statement and the Company has applied to list the ADSs on the NASDAQ Capital Market. There is no action pending by the Company or, to the Company’s knowledge, the NASDAQ Capital Market to withdraw or deny the application to list the ADSs on the NASDAQ Capital Market.

(vii)             The Company has not taken, directly or indirectly, any action that is designed to or that has constituted or that would reasonably be expected to cause or result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares or the ADSs.

(viii)           The Company is not and, after giving effect to the offering and sale of the Shares, will not be an “investment company,” as such term is defined in the Investment Company Act of 1940, as amended.

(b)           Any certificate signed by any officer of the Company and delivered to the Underwriter or to the Underwriter’s counsel pursuant to this Agreement shall be deemed a representation and warranty by the Company to the Underwriter as to the matters covered thereby.

3.           Representations and Warranties of the Company Regarding the Company.

(a)           The Company represents and warrants to, and agrees with, the Underwriter as of the date hereof and as of the Closing Date, as follows:

(i)           Each of the Company and its subsidiaries has been duly incorporated or organized and is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation or organization. Each of the Company and its subsidiaries has the corporate power and authority to own or lease its properties and conduct its business as currently being carried on and as described in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus.

(ii)           The Company has the power and authority to enter into this Agreement, the Deposit Agreement, the Underwriter’s Warrant (as defined below) and all other agreements, documents, certificates and instruments required to be delivered pursuant to this Agreement, to authorize, issue and sell the Shares and the ADSs as contemplated by this Agreement.  This Agreement, the Deposit Agreement and the Underwriter’s Warrant have been duly authorized, executed and delivered by the Company, and constitute valid, legal and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except as rights to indemnity hereunder may be limited by federal or state securities laws and except as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting the rights of creditors generally and subject to general principles of equity.

(iii)           The execution, delivery and performance of this Agreement, the Deposit Agreement, the Underwriter’s Warrant and all other agreements, documents, certificates and instruments required to be delivered pursuant to this Agreement, and the consummation of the transactions hereby and thereby contemplated will not (A) result in a breach or violation of any of the terms and provisions of, or constitute a default under, any law, rule, regulation, ordinance, directive, judgment, decree or order of any judicial, regulatory or other legal or governmental agency or body, domestic or foreign to which the Company or any subsidiary is subject, or by which any property or asset of the Company or any subsidiary is bound or affected, (B) conflict with, result in any violation or breach of, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any right of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, lease, credit facility, debt, note, bond, mortgage, indenture or other instrument (the “Contracts”) or obligation or other understanding to which the Company or any subsidiary is a party of by which any property or asset of the Company or any subsidiary is bound or affected, except to the extent that such conflict, default, termination, amendment, acceleration or cancellation right is not reasonably likely to result in a material adverse effect upon the business, prospects, properties, shareholders’ equity, operations, condition (financial or otherwise) or results of operations of the Company and its subsidiaries taken as a whole, or in its ability to perform its obligations under this Agreement, the Deposit Agreement or the Underwriter’s Warrant (“Material Adverse Effect”), or (C) result in a breach or violation of any of the terms and provisions of, or constitute a default under, the Company’s memorandum and articles of association.

(iv)           Neither the Company nor any of its subsidiaries (A) is in violation of its certificates, licenses, permits or authorizations issued by competent governmental, regulatory or judicial authorities or (B) is in violation, breach or default under its memorandum of association, articles of association or other equivalent organizational or governing documents, except, in each case , where the violation, breach or default in the case of a subsidiary of the Company is not reasonably likely to result in a Material Adverse Effect.

(v)           All consents, approvals, orders, authorizations and filings required on the part of the Company and its subsidiaries in connection with the execution, delivery or performance of this Agreement, the Deposit Agreement and the Underwriter’s Warrant have been obtained or made, other than such consents, approvals, orders and authorizations the failure of which to make or obtain is not reasonably likely to result in a Material Adverse Effect.

(vi)           All of the issued and outstanding shares of capital stock of the Company are duly authorized and validly issued, fully paid and non-assessable, and have been issued in compliance with all applicable securities laws, and conform to the description thereof in the Registration Statement, the ADS Registration Statement, Form 8-A Registration Statement, the Time of Sale Disclosure Package and the Prospectus.  Except for the issuance of the Underwriter’s Warrant as contemplated by and described in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, since the respective dates as of which information is provided in the Registration Statement, the Time of Sale Disclosure Package or the Prospectus, the Company has not entered into or granted any convertible or exchangeable securities, options, warrants, agreements, contracts or other rights in existence to purchase or acquire from the Company any shares of the capital stock of the Company.  The Shares, when issued, will be duly authorized and validly issued, fully paid and non-assessable, will be issued in compliance with all applicable securities laws, and will be free of preemptive, registration or similar rights other than such rights as have been duly waived or satisfied.

(vii)           The ADSs, when issued by the Depositary against the deposit of Shares in respect thereof in accordance with the provisions of the Deposit Agreement, will be duly authorized and validly issued and the persons in whose names such ADSs are registered will be entitled to the rights of registered holders of ADSs specified therein and in the Deposit Agreement.

(viii)           The Deposit Agreement, the ADSs and the ADRs conform to the descriptions thereof contained in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus.

(ix)           The Shares and the ADSs are freely transferable by the Company to or for the account of the Underwriter and (to the extent described in the Prospectus) the initial holders thereof; and, except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, there are no restrictions on subsequent transfers of the Shares or the ADSs under the laws of the Cayman Islands, the People’s Republic of China (the “PRC”) or the United States.

(x)           Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, each of the Company, Asia Success Holdings Limited, a Hong Kong limited company (the “Hong Kong Subsidiary”), and each of the PRC Entities (as defined in Section 4(a)(i) below and together with the Hong Kong Subsidiary, the “Subsidiaries”) has duly and timely filed all returns (as hereinafter defined) required to be filed prior to the date hereof or has duly and timely obtained extensions of time for the filing thereof.  Such returns that were filed are true, correct and complete in all material respects.  The Company and each of its Subsidiaries have duly and timely paid all taxes (as hereinafter defined) due with respect to such returns and have duly and timely paid all taxes imposed on or assessed against the Company or such respective Subsidiary.  The provisions for taxes payable, if any, shown on the consolidated financial statements filed with or as part of the Registration Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, of the Company and its Subsidiaries for all periods to and including the dates of such consolidated financial statements.  Except as disclosed in writing to the Underwriter, (A) no issue has been raised by (or is currently pending with) any taxing or other governmental authority in connection with any return of, or tax asserted as due from, the Company or any of its Subsidiaries, and (B) no waiver of any statute of limitations with respect to any return or collection of tax has been given by, or requested from, the Company or any of its Subsidiaries.  The term “taxes” means any and all federal, state, local, and foreign net income, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments, or charges of any kind whatsoever imposed by a taxing or other governmental authority, together with any interest and any penalties, additions to tax, or additional amounts with respect thereto or relating to any return.  The term “returns” means any and all returns, declarations, reports, statements, or other documents required to be filed with any taxing or other governmental authority.

(xi)           Since the respective dates as of which information is given in the Registration Statement, the Time of Sale Disclosure Package or the Prospectus, (A) neither the Company nor the Hong Kong Subsidiary nor any of the PRC Entities has incurred any material liabilities or obligations, direct or contingent, or entered into any material transactions other than in the ordinary course of business, (B) the Company has not declared or paid any dividends or made any distribution of any kind with respect to its capital stock; (C) there has not been any change in the capital stock of the Company or any of its subsidiaries, (D) there has not been any material change in the Company’s long-term or short-term debt, and (E) there has not been the occurrence of any Material Adverse Effect.

(xii)           There is no pending or, to the knowledge of the Company, threatened, any action, suit or proceeding to which the Company, the Hong Kong Subsidiary or any of the PRC Entities is a party or of which any property or assets of the Company, the Hong Hong Subsidiary or any of the PRC Entities is the subject before or by any court or governmental agency, authority or body, or any arbitrator or mediator, which is reasonably likely to result in a Material Adverse Effect.

(xiii)           Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, the Company, the Hong Kong Subsidiary and each of the PRC Entities holds, and is in compliance with, all franchises, grants, authorizations, licenses, permits, easements, consents, certificates and orders (“Permits”) of any governmental or self-regulatory agency, authority or body required for the conduct of its business, and all such Permits are in full force and effect, in each case except where the failure to hold, or comply with, any of them is not reasonably likely to result in a Material Adverse Effect.

(xiv)           Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, the Company, the Hong Kong Subsidiary and each of the PRC Entities have all consents, approvals, authorizations, orders, registrations, qualifications, licenses, filings and permits of, with and from all judicial, regulatory and other legal or governmental agencies and all third parties, foreign and domestic, to own, lease and operate all property (whether real or personal) described in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus as being owned by them that are material to the business of the Company, in each case free and clear of all liens, claims, security interests, other encumbrances or defects, except those that are not reasonably likely to result in a Material Adverse Effect.  The property described in the Registration Statement, the time of Sale Disclosure Package and the Prospectus as held under lease or pursuant to house ownership certificate by the Company, the Hong Kong Subsidiary or the PRC Entities is held by them under valid, subsisting and enforceable leases with only such exceptions with respect to any particular lease or pursuant to house ownership certificate, as the case may be, as do not interfere in any material respect with the conduct of the business of the Company, the Hong Kong Subsidiary or the PRC Entities.  Neither the Company nor the Hong Kong Subsidiary nor any of the PRC Entities has received any notice of any claim adverse to its ownership of any real or personal property or any claim against the continued possession of any real property, whether owned or held under lease or sublease by the Company or any subsidiary.

(xv)           The Company, the Hong Kong Subsidiary and each of the PRC Entities owns or possesses or has valid right to use all patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses, formulae, inventions, customer lists, know-how,  trade secrets and similar rights (“Intellectual Property”) necessary for the conduct of the business of the Company, the Hong Kong Subsidiary and each of the PRC Entities as currently carried on and as described in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus.  To the knowledge of the Company, no action or use by the Company, the Hong Kong Subsidiary or the PRC Entities will involve or give rise to any infringement of, or license or similar fees for, any Intellectual Property of others, except where such action, use, license or fee is not reasonably likely to result in a Material Adverse Effect.  Neither the Company nor the Hong Kong Subsidiary nor any of the PRC Entities has received any notice alleging any such infringement or fee.  There is no pending nor, to the knowledge of the Company, threatened action, suit, proceeding by any person challenging the rights of the Company, the Hong Kong Subsidiary or the PRC Entities in or to any such Intellectual Property, and the Company is unaware of any facts which would form a reasonable basis for any such claim.

(xvi)           The Company, the Hong Kong Subsidiary and each of the PRC Entities have complied with, are not in violation of, and have not received any notice of violation relating to any law, rule or regulation relating to the conduct of its business, or the ownership or operation of its property and assets, including, without limitation, (A) the Currency and Foreign Transactions Reporting Act of 1970, as amended, or any money laundering laws, rules or regulations, (B) any laws, rules or regulations related to health, safety or the environment, including those relating to the regulation of hazardous substances, (C) the Sarbanes-Oxley Act and the rules and regulations of the Commission thereunder, and (D) the Foreign Corrupt Practices Act of 1977 and the rules and regulations thereunder, in each case except where the failure to be in compliance is not reasonably likely to result in a Material Adverse Effect.

(xvii)           Neither the Company nor the Hong Kong Subsidiary nor any of the PRC Entities nor, to the knowledge of the Company, any director, officer, employee, representative, agent or affiliate of the Company, the Hong Kong Subsidiary or any of the PRC Entities is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company will not directly or indirectly use the proceeds of the offering of the Shares and the ADSs contemplated hereby, or lend, contribute or otherwise make available such proceeds to any person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

(xviii)           Reserved

(xix)           Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, each of the Company, the Hong Kong Subsidiary and the PRC Entities has complied in all material respects with all applicable employment and labor laws with respect to its employees.  No labor dispute with the employees of the Company, the Hong Kong Subsidiary or any of the PRC Entities exists or, to the knowledge of the Company, is imminent that is reasonably likely to result in a Material Adverse Effect.

(xx)           Neither the Company, nor the Hong Kong Subsidiary nor any of the PRC Entities, nor to the Company’s knowledge, any other party is in violation, breach or default of any Contract that is reasonably likely to result in a Material Adverse Effect.

(xxi)           No supplier, customer, distributor or sales agent of the PRC Entities has notified the Company, the Hong Kong Subsidiary or any of the PRC Entities that it intends to discontinue or decrease the rate of business done with the Company, the Hong Kong Subsidiary or any of the PRC Entities except where such decrease is not reasonably likely to result in a Material Adverse Effect.

(xxii)           Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, there are no claims, payments, issuances, arrangements or understandings for services in the nature of a finder’s, consulting or origination fee with respect to the introduction of the Company to the Underwriter or the sale of the Shares and the ADSs hereunder or any other arrangements, agreements, understandings, payments or issuances with respect to the Company that may affect the Underwriter’s compensation, as determined by the Financial Industry Regulatory Authority (“FINRA”).

(xxiii)           Except as disclosed to the Underwriter in writing, the Company has not made any direct or indirect payments (in cash, securities or otherwise) to (A) any person, as a finder’s fee, investing fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who provided capital to the Company, (B) any FINRA member, or (C) any person or entity that has any direct or indirect affiliation or association with any FINRA member within the 12-month period prior to the date on which the Registration Statement was filed with the Commission (“Filing Date”) or thereafter.

(xxiv)           None of the net proceeds of the offering will be paid by the Company to any participating FINRA member or any affiliate or associate of any participating FINRA member, except as specifically authorized herein.

(xxv)           To the Company’s knowledge, no (A) officer or director of the Company, the Hong Kong Subsidiary or any PRC Entity, (B) owner of 5% or more of the Company’s securities or that of the Hong Kong Subsidiary or any PRC Entity or (C) owner of any amount of the Company’s securities acquired within the 180-day period prior to the Filing Date, has any direct or indirect affiliation or association with any FINRA member.  The Company will advise the Underwriter and its counsel if it becomes aware that any officer, director or stockholder of the Company, the Hong Kong Subsidiary or any of the PRC Entities is or becomes an affiliate or associated person of a FINRA member participating in the offering.

(xxvi)           Other than the Underwriter, no person has the right to act as an underwriter or as a financial advisor to the Company in connection with the transactions contemplated hereby.

4.           Representations and Warranties of the Company Regarding the PRC Entities.

(a)           The Company represents and warrants to, and agrees with, the Underwriter, as of the date hereof and as of the Closing Date, as follows:

(i)           The Company conducts substantially all of its operations and generates substantially all of its revenue through (A) Putian Asia Success Cereals & Oils Technical Service Co., Ltd., a wholly foreign-owned enterprise formed under the laws of the PRC (“Putian”) and (B) Fujian Grand Farm Foods Development Co., Ltd., a company formed under the laws of the PRC (“Grand Farm China”), which the Company controls, through contractual arrangements among Putian and Grand Farm China and its shareholders.  Putian and Grand Farm China are collectively referred to in this Agreement as the “PRC Entities.”

(ii)           Each of the PRC Entities has been duly established, is validly existing as a company under the laws of the PRC, has the corporate power and authority to own, lease and operate its property and to conduct its business as described in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, and is duly qualified to conduct its business operation, enforce its agreements and transact business in the PRC and in each other jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified, to conduct its normal business operation or enforce its agreements would not, singly or in the aggregate, have a Material Adverse Effect.  Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, each PRC Entity has applied for and obtained all requisite business licenses, clearance and permits required under PRC law and regulations as necessary for the conduct of its businesses,  and each PRC Entity has complied in all material respects with all applicable PRC laws and regulations in connection with foreign exchange, including without limitation, carrying out all relevant filings, registrations and applications for relevant permits with the relevant branch of the PRC State Administration of Foreign Exchange and any other relevant  authorities, and all such permits are validly subsisting.  The registered capital of each PRC Entity has been fully paid up in accordance with the schedule of payment stipulated in its respective articles of association, approval document, certificate of approval and legal person business license (hereinafter referred to as the “Establishment Documents”) and in compliance with PRC laws and regulations, and there is no outstanding capital contribution commitment for any PRC Entity.  The Establishment Documents of the PRC Entities have been duly approved in accordance with the laws of the PRC and are valid and enforceable.  The business scope specified in the Establishment Documents of each PRC Entity complies with the requirements of all relevant PRC laws and regulations.  None of the PRC Entities is carrying out or has carried out any business activities that are beyond its business scope or the scope of its Permits.  The outstanding equity interests of each PRC Entity is owned of record by the respective entities or individuals identified as the registered holders thereof in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus.  Except for the PRC Entities, the Company does not presently own, control or have, directly or indirectly, any interest in any other corporation, partnership, trust, joint venture, association, branch offices or other entity in the PRC.

(iii)           Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, no consents, approvals, authorizations, orders, registrations, clearances, certificates, franchises, licenses, permits or qualifications of or with any PRC governmental agency are required for Putian’s contractual arrangements and agreements with Grand Farm China and its registered equity holders (the “VIE Structure”) or the execution, delivery and performance of such contractual arrangements and agreements (the “VIE Structuring Documents”).  None of the VIE Structuring Documents has been revoked and no such revocation is pending or threatened.  Each of the VIE Structuring Documents has been entered into prior to the date thereof in compliance with all applicable laws and regulations and constitutes a valid and legally binding agreement, enforceable in accordance with its terms.

(iv)           The VIE Structure and the execution, delivery and performance of the VIE Structuring Documents and the consummation of the transactions contemplated thereby did not and do not (A) conflict with, or result in a breach or violation of any of the terms and provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which any PRC Entity is a party or by which any PRC Entity is bound or by which any of the properties or assets of any PRC Entity is subject, (B) violate or conflict with the Establishment Documents of any PRC Entity, or (C) violate or conflict with any applicable laws, regulations, rules, orders, decrees, guidelines, notices or other legislation of the PRC.

(v)           Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, the VIE Structure complies, and after the consummation of the offering and sale of the Shares and the ADSs will comply, with all applicable laws, regulations, rules, orders, decrees, guidelines, notices or other legislation of the PRC; the VIE Structure has not been challenged by any PRC governmental agency and there are no legal, arbitration, governmental or other proceedings (including, without limitation, governmental investigations or inquiries) pending before or, to the Company’s knowledge, threatened or contemplated by any PRC governmental agency in respect of the VIE Structure; and the Company reasonably believes that after the consummation of the offering and sale of the Shares and the ADSs, the VIE Structure could not be successfully challenged by any PRC governmental agency.

(vi)           The Company possesses, directly or indirectly, the power to direct, or cause the direction of, the management and policies of Grand Farm China.

(vii)           Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, (A) Putian is not currently prohibited, directly or indirectly, from paying any dividends to the Company (or the Hong Kong Subsidiary), (B) Grand Farm China is not currently prohibited, directly or indirectly, from paying any of its obligations set forth in the VIE Structuring Documents and (C)  no PRC Entity is prohibited, directly or indirectly, from making any other distribution on such PRC Entity’s equity capital, or from repaying to the Company or any of its direct or indirect subsidiaries any loans or advances to such PRC Entity from the Company or any of the Company’s subsidiaries.

(viii)           None of the PRC Entities nor any of their properties, assets or revenues are entitled to any right of immunity on the grounds of sovereignty from any legal action, suit or proceeding, from set-off or counterclaim, from the jurisdiction of any court, from services of process, from attachment prior to or in aid of execution of judgment, or from any other legal process or proceeding for the giving of any relief or for the enforcement of any judgment.

(ix)           It is not necessary that this Agreement, the Deposit Agreement, the Underwriter’s Warrant, the Registration Statement, the Time of Sale Disclosure Package, the Prospectus or any other document be filed or recorded with any governmental agency, court or other authority in the PRC.

(x)           No transaction, stamp, capital or other issuance, registration, transaction, transfer, income, capital gains, withholding or other taxes or duties are payable by or on behalf of the Underwriter to the government of the PRC or to any political subdivision or taxing authority thereof or therein in connection with (A) the execution and delivery of this Agreement, (B) the issuance, sale and delivery of the Shares and the ADSs by the Company and the delivery of the Shares and the ADSs to or for the account of the Underwriter, (C) the purchase from the Company and the initial sale and delivery by the Underwriter of the Shares and the ADSs to purchasers thereof, or (D) the consummation of any other transaction contemplated in this Agreement.

(xi)           Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and he Prospectus, the Company has taken all necessary steps to comply with, and to require compliance by all of the Company’s direct or indirect shareholders and option holders who are PRC residents with, any applicable rules and regulations of the PRC, including the regulations issued by the State Administration of Foreign Exchange of the PRC (the “SAFE Rules and Regulations”), including, without limitation, using its reasonable best efforts to require each shareholder and option holder that is, or is directly or indirectly owned or controlled by, a PRC resident to complete any registration and other procedures required under applicable SAFE Rules and Regulations.

(xii)           The Company is aware of, and has been advised as to, the content of the Rules on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, as in effect on the date hereof, jointly promulgated on August 8, 2006 by the PRC Ministry of Commerce, the PRC State Assets Supervision and Administration Commission, the PRC State Administration of Taxation, the PRC State Administration of Industry and Commerce, the China Securities Regulatory Commission (the “CSRC”) and the PRC State Administration of Foreign Exchange of the PRC and amended Rules on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors promulgated on June 22, 2009 by the PRC Ministry of Commerce (collectively, the “M&A Rules”), in particular the relevant provisions thereof that purport to require offshore special purpose vehicles controlled directly or indirectly by PRC-incorporated companies or PRC residents and established for the purpose of obtaining a stock exchange listing outside of the PRC to obtain the approval of the CSRC prior to the listing and trading of their securities on any stock exchange located outside of the PRC.  The Company has received legal advice specifically with respect to the M&A Rules from its PRC counsel and the Company understands such legal advice.  In addition, the Company has communicated such legal advice in full to each of its directors that signed the Registration Statement and each such director has confirmed that he or she understands such legal advice.

(xiii)           The issuance and sale of the Shares, the listing and trading of the ADSs on the NASADAQ Capital Market and the consummation of the transactions contemplated by this Agreement, the Deposit Agreement, the Underwriter’s Warrant, the Registration Statement, the Time of Sale Disclosure Package and the Prospectus are not as of the date hereof and will not be, on the Closing Date, subject to or otherwise materially affected by the M&A Rules or any official clarifications, guidance, interpretations or implementation rules in connection with or related to the M&A Rules, including the guidance and notices issued by the CSRC on September 8 and September 21, 2006 (together with the M&A Rules, the “M&A Rules and Related Clarifications”).

(xiv)           The Company has used its reasonable best efforts to require compliance by each of its shareholders, option holders, directors, officers and employees that is, or is directly or indirectly owned or controlled by, a PRC resident or citizen with any applicable rules and regulations of the relevant PRC government agencies (including but not limited to the PRC Ministry of Commerce, the PRC National Development and Reform Commission and the PRC State Administration of Foreign Exchange) relating to overseas investment by PRC residents and citizens (the “PRC Overseas Investment and Listing Regulations”), including, requesting each shareholder, option holder, director, officer, employee and participant that is, or is directly or indirectly owned or controlled by, a PRC resident or citizen to complete any registration and other procedures required under applicable PRC Overseas Investment and Listing Regulations.

(xv)           As of the date hereof, the M&A Rules and Related Clarifications do not require the Company to obtain the approval of the CSRC prior to the issuance and sale of the Shares and the ADSs, the listing and trading of the ADSs on the NASDAQ Capital Market, or the consummation of the transactions contemplated by this Agreement, the Registration Statement, the Time of Sale Disclosure Package or the Prospectus.

(xvi)           Each of the PRC Entities is in compliance with all requirements under all applicable PRC laws and regulations to qualify for an exemption from enterprise income tax or other income tax benefits (the “Tax Benefits”) as described in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, and the actual operations and business activities of each such PRC Entity are sufficient to meet the qualifications for the Tax Benefits.  No submissions made to any PRC government authority in connection with obtaining the Tax Benefits contained any misstatement or omission that to the Company’s knowledge would have affected the granting of the Tax Benefits.  No PRC Entity has received notice of any deficiency in its respective applications for the Tax Benefits, and the Company is not aware of any reason why any such PRC Entity might not qualify for, or be in compliance with the requirements for, the Tax Benefits.

(xvii)           All local and national PRC governmental tax holidays, exemptions, waivers, financial subsidies, and other local and national PRC tax relief, concessions and preferential treatment enjoyed by any PRC Entity as described in the Registration Statement, the Time of Disclosure Package and the Prospectus are valid, binding and enforceable and do not violate any laws, regulations, rules, orders, decrees, guidelines, judicial interpretations, notices or other legislation of the PRC.

5.           Purchase, Sale and Delivery of Shares and ADSs.

(a)           On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company agrees to issue and sell the Underwritten Shares, in the form of ADSs, to the Underwriter, and the Underwriter agrees to purchase the Underwritten Shares.  The purchase price for each Underwritten Share shall be $____ per share (the “Per Share Price”).

EX-3.1

THE COMPANIES LAW (2010 Revision)

EXEMPTED COMPANY LIMITED BY SHARES

AMENDED AND RESTATED MEMORANDUM OF ASSOCIATION

OF

GRAND FARM INC.

(the “Company”)

1. The name of the Company is Grand Farm Inc..

2. The registered office of the Company is situate at the offices of Offshore Incorporations (Cayman) Limited, Scotia Centre, 4th Floor, P.O. Box 2804, George Town, Grand Cayman KY1-1112, Cayman Islands, or at such other place as the Directors may determine.

3. The objects for which the Company is established are unrestricted and the Company shall have full power and authority to carry out any object not prohibited by any law as provided by Section 7(4) of The Companies Law (2010 Revision).

4. The Company shall have and be capable of exercising all the functions of a natural person of full capacity irrespective of any question of corporate benefit as provided by Section 27(2) of The Companies Law (2010 Revision).  PROVIDED THAT the Company shall only carry on the businesses for which a license is required under the laws of the Cayman Islands when so licensed under the terms of such laws.

5. The liability of the members is limited to the amount from time to time unpaid on such member's shares.

6. THE AUTHORISED SHARE CAPITAL of the Company is two hundred thousand United States dollars (US$200,000.00)divided into one hundred million (100,000,000) shares each with a nominal or par value of one twentieth of one cent each (US$0.002) with the power for the Company, insofar as is permitted by law, to redeem or purchase any of its shares and to increase or reduce such capital and to issue all or any part of its capital (whether original, redeemed, increased or reduced) with or without any preference, priority or special privilege, or subject to any postponement of rights, or to any conditions or restrictions whatsoever and so that, unless the conditions of issue shall otherwise expressly provide, every issue of shares, whether stated to be preference or otherwise, shall be subject to the powers on the part of the Company hereinbefore contained.

7. If the Company is registered as an exempted company in accordance with the Companies Law (2010 Revision), the Company will comply with the provisions of such law relating to exempted companies and, subject to the provisions of the Companies Law and the Articles of Association, it shall have the power to register by way of continuation as a body corporate limited by shares under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands.

8. The Company shall not have the power to issue shares to bearer.

INTERPRETATION	1
SHARES	2
DIRECTORS AUTHORITY TO ISSUE SHARES	2
SHARE CERTIFICATES	2
REGISTER OF MEMBERS	2
TRANSFER OF SHARES	3
REDEEMABLE SHARES	3
VARIATION OF SHARE RIGHTS	3
COMMISSION ON SALE OF SHARES	4
NON-RECOGNITION OF TRUSTS	4
LIEN	4
CALLS ON SHARES	5
FORFEITURE OF SHARES	5
REGISTRATION OF EMPOWERING INSTRUMENTS	6
TRANSMISSION OF SHARES	6
ALTERATION OF SHARE CAPITAL	7
CLOSING REGISTER OF MEMBERS OR FIXING RECORD DATE	7
STATUTORY MEETINGS	8
GENERAL MEETINGS	8
NOTICE OF GENERAL MEETINGS	8
PROCEEDINGS AT GENERAL MEETINGS	9
VOTES OF MEMBERS	9
RESOLUTIONS IN WRITING	10
PROXIES	10
CORPORATIONS ACTING BY REPRESENTATIVES AT MEETINGS	11
DIRECTORS AND OFFICERS	11
ALTERNATE DIRECTORS	12
POWERS AND DUTIES OF DIRECTORS	12
MANAGEMENT	13
MANAGING DIRECTOR	13
PROCEEDINGS OF DIRECTORS	14
VACATION OF OFFICE OF DIRECTOR	14
APPOINTMENT AND REMOVAL OF DIRECTORS	15
PRESUMPTION OF ASSENT	15
SEAL	15
OFFICERS	15
DIVIDENDS AND RESERVES	16

 

CAPITALISATION OF PROFITS	16
BOOKS OF ACCOUNT	17
AUDIT	17
NOTICES	18
LIQUIDATION OF THE COMPANY	18
INDEMNITY	19
FINANCIAL YEAR	19
AMENDMENT OF MEMORANDUM AND ARTICLES	19
TRANSFER BY WAY OF CONTINUATION	19

THE COMPANIES LAW (2010 Revision)

COMPANY LIMITED BY SHARES

AMENDED AND RESTATED ARTICLES OF ASSOCIATION

OF

GRAND FARM INC.

PRELIMINARY

1. The regulations in Table “A” in the First Schedule to the Law (as defined below) shall not apply to the Company except insofar as they are repeated or contained in these Articles.

INTERPRETATION

2. In these Articles, if not inconsistent with the subject or context, the following expressions shall have the following meanings:

2.1 “Articles” means the present articles of association and all supplementary, amended or substituted articles for the time being in force.

“Company” means the above named company.

“Directors” means the directors for the time being of the Company.

“Law” means the Companies Law (2010 Revision) of the Cayman Islands and every statutory modification or re-enactment thereof for the time being in force.

“member” has the meaning assigned to it in the Law.

“Memorandum of Association” means the present memorandum of association and all supplementary amended or substituted memoranda of the Company for the time being in force.

“Ordinary Resolution” means a resolution passed by a simple majority of the votes cast of such members of the Company as, being entitled to do so, vote in person or, where proxies are allowed, by proxy or, in the case of corporations, by their duly authorised representatives, at a general meeting held in accordance with these Articles and includes a written resolution passed pursuant to these Articles.

“Secretary” means any person appointed to perform the duties of secretary of the Company and shall include an assistant secretary.

“share”   includes a fraction of a share.

“Special Resolution” has the meaning assigned to it in the Law.

2.2 Expressions defined in the Law, or any statutory modification or re-enactment thereof in force at the date on which these Articles become binding on the Company, shall have the meanings so defined.

2.3 Words importing the singular number shall include the plural number and vice versa.

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2.4 Words importing the masculine gender shall include the feminine and neuter genders.

2.5 Persons shall include corporations.

2.6 The headings are intended for convenience and shall not affect the construction of these Articles.

SHARES

3. Subject to the provisions, if any, in  the Memorandum of Association and to any direction that may be given by the Company in general meeting and without prejudice to any special rights previously conferred on the holders of existing shares, any share may be issued with such preferred, deferred or other special rights, or such restrictions, whether in regard to dividend, voting, return of share capital or otherwise, as the Directors may from time to time determine and, subject to the provisions of the Law, any share may, with the sanction of a Special Resolution, be issued on the terms that it is, or at the option of the Company is liable, to be redeemed.

4. No shares shall be issued to bearer.

DIRECTORS AUTHORITY TO ISSUE SHARES

5. Subject to the provisions of these Articles relating to shares, the shares shall be at the disposal of the Directors and they may (subject to the provisions of the Law) allot, grant options over, or otherwise dispose of them to such persons, on such terms and conditions and at such times as they think fit but so that no share shall be issued at a discount, except in accordance with the provisions of the Law, and so that in the case of shares offered to the public for subscription the amount payable on application on each share shall not be less than such percentage of the nominal amount of the share as shall be determined by the Directors.

SHARE CERTIFICATES

6. Every person whose name is entered as a member in the register of members shall, without payment, be entitled to a certificate under the seal of the Company specifying the share or shares held by him and the amount paid-up thereon provided that, in respect of a share or shares held jointly by several persons, the Company shall not be bound to issue more than one certificate and delivery of a certificate for a share to one of several joint holders shall be sufficient delivery to all.

7. If a share certificate is worn out, defaced, lost or destroyed, it may be renewed on payment of such fee, if any, not exceeding one United States dollar and on such terms, if any, as to evidence and indemnity as the Directors may prescribe.

REGISTER OF MEMBERS

8. The Directors shall keep or cause to be kept at the Registered Office or such other place determined by the Directors the register of members containing such particulars relating to each member as they may deem appropriate provided that the following particulars are recorded:

(a) the name and address of each member, a statement of the shares of each class held by him and of the amount paid, or agreed to be considered as paid, on such shares;

(b) the date on which the name of each person was entered in the register of members as a member; and

(c) the date on which any person ceased to be a member.

The Company shall not be bound to register more than four persons as joint holders of any share. If any share shall stand in the names of two or more persons, the person first named in the register shall be deemed the sole holder thereof as regards service of notices and, subject to the provisions of these Articles, all or any other matters connected with the Company, except the transfer of the share.

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TRANSFER OF SHARES

9. The instrument of transfer of any share shall be executed by or on behalf of the transferor and transferee and the transferor shall be deemed to remain a holder of the share until the name of the transferee is entered in the register of members in respect thereof provided that the Directors may waive execution by the transferee of the instrument of transfer but shall, as soon as possible thereafter, inform the transferee of such waiver of execution.

10. Transfers of shares may be effected by an instrument of transfer in the usual common form or in such other form as the Directors may approve.  All instruments of transfer must be left at the registered office of the Company or at such other place as the Directors may appoint and all such instruments of transfer shall be retained by the Company.

11. The Directors may, in their absolute discretion and without assigning any reason therefor, decline to register any transfer of any share, whether or not it is a fully paid share.  The Directors may also decline to recognise any instrument of transfer unless the instrument of transfer is accompanied by any share certificate to which it relates and such other evidence as the Directors may reasonably require to show the right of the transferor to make the transfer.  If the Directors refuse to register a transfer of any shares they shall, within one month from the date on which the transfer was lodged with the Company, send to the transferee notice of the refusal.

12. The registration of transfers may be suspended at such time and for such periods as the Directors may from time to time determine including the period commencing 14 days prior to the annual general meeting up to and including the date of the annual general meeting.

REDEEMABLE SHARES

13. (a) Subject to the provisions of the Law and the Memorandum of Association of the Company, and to any special rights conferred on the holders of any shares or attaching to any class of shares, shares may be issued on the terms that they may be, or at the option of the Company or the holders are, liable to be redeemed on such terms and in such manner, including out of capital, as the Company, before the issue of the shares, may by special resolution determine.

(b) Subject to the Law and subject to any rights conferred on the holders of any class of shares, the Company shall have the power to purchase or otherwise acquire all or any of its own shares (which expression as used in this Article includes redeemable shares and fractional shares) provided that the manner of purchase has first been authorised by a resolution of the shareholders, and may make payment in any manner authorised or not prohibited by law, including out of capital.

VARIATION OF SHARE RIGHTS

14. If at any time the share capital is divided into different classes of shares the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may be varied with the consent in writing of the holders of three fourths of the issued shares of that class or with the sanction of a resolution passed by the holders of three fourths of the issued shares of that class at a separate general meeting of the holders of the shares of the class.  To every such separate general meeting the provisions of these Articles relating to general meetings shall apply, but so that the necessary quorum shall be one person holding or representing by proxy at least one third of the issued shares of the class (but so that if, at any adjourned meeting of such holders, a quorum as defined above is not present, those members who are present shall be a quorum) and that any holder of shares of the class present in person or by proxy may demand a poll and, on a poll, shall have one vote for each share of the class of which he is the holder.

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15. The rights conferred upon the holders of the shares of any class issued with preferred or other rights shall, unless otherwise expressly provided by the terms of issue of the shares of that class, be deemed not to be varied by the creation or issue of further shares ranking pari passu therewith.

COMMISSION ON SALE OF SHARES

16. The Company may at any time pay a commission to any person for subscribing or agreeing to subscribe (whether absolutely or conditionally) for any shares in the Company or procuring or agreeing to procure subscriptions (whether absolute or conditional) for any shares in the Company, but so that the conditions and requirements of the Law shall be observed and complied with.  Such commissions may be satisfied by the payment of cash or the lodgement of fully or partly paid-up shares or partly in one way and partly in the other. The Company may also on any issue of shares pay such brokerage as may be lawful.

NON-RECOGNITION OF TRUSTS

   

17. Except as required by law, no person shall be recognised by the Company as holding any share upon any trust, and the Company shall not be bound by or be compelled in any way to recognise (even when having notice thereof) any equitable, contingent, future or partial interest in any share or any interest in any fractional part of a share (except only as is otherwise provided by these Articles, by law or under an order of a court of competent jurisdiction) or any other rights in respect of any share except an absolute right to the entirety thereof in the registered holder.

LIEN

18. The Company shall have a first and paramount lien on every share (whether fully paid or not) registered in the name of a member (whether solely or jointly with others) for all debts, liabilities or engagements to or with the Company (whether presently payable or not) by such member or his estate, either alone or jointly with any other person, whether a member or not, but the Directors may at any time declare any share to be wholly or in part exempt from the provisions of this Article..  The registration of a transfer of any such share shall operate as a waiver of the Company’s lien (if any) thereon.  The Company's lien, if any, on a share shall extend to all dividends payable thereon.

19. The Company may sell, in such manner as the Directors think fit, any shares on which the Company has a lien, but no sale shall be made unless some sum in respect of which the lien exists is presently payable or the liability or engagement in respect of which such lien exists is liable to be fulfilled or discharged, and until the expiration of fourteen days after a notice in writing, stating and demanding payment of the sum presently payable or specifying the liability or engagement and demanding fulfilment or discharge thereof and giving notice of the intention to sell in default has been given to the registered holder for the time being of the share, or the persons entitled thereto by reason of his death, incapacity or bankruptcy.

20. The net proceeds of such sale by the Company after the payment of the costs of such sale shall be applied in or towards payment or satisfaction of the debt or liability or engagement, in respect of which the lien exists, of such part of the amount in respect of which the lien exists so far as the same is presently payable and the residue shall (subject to a like lien for sums not presently payable as existed upon the shares prior to the sale and upon surrender, if required by the Company, for cancellation of the certificate for the share sold) be paid to the person entitled to the shares at the date of the sale.

21. For giving effect to any such sale, the Directors may authorise some person to transfer the shares sold to the purchaser thereof.  The purchaser shall be registered as the holder of the shares comprised in any such transfer and he shall not be bound to see to the application of the purchase money, nor shall his title to the shares be affected by any irregularity or invalidity in the proceedings in relation to the sale.

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CALLS ON SHARES

22. The Directors may from time to time make calls upon the members in respect of any moneys unpaid on their shares (whether on account of the nominal value of the shares or by way of premium or otherwise) and not by the conditions of allotment thereof made payable at fixed times.  Each member shall (subject to receiving at least fourteen days' notice specifying the time or times and place of payment) pay to the Company at the time or times and place so specified the amount called on his shares.  A person upon whom a call is made shall remain liable on such call notwithstanding the subsequent transfer of the shares in respect of which the call was made.  A call may be revoked or postponed at the determination of the Directors.

23. The joint holders of a share shall be jointly and severally liable to pay all calls and instalments due in respect of such share or other moneys due in respect thereof.

24. A copy of the notice referred to in the preceding Article shall be sent in the manner in which notices may be sent to members by the Company as provided herein.

25. A call shall be deemed to have been made at the time when the resolution of the Directors authorising the call was passed and may be required to be paid by instalments.

26. If a sum called in respect of a share is not paid before or on the day appointed for payment thereof, the person from whom the sum is due shall pay interest on the sum from such day appointed for payment to the time of actual payment at such rate not exceeding fifteen per cent. per annum as the Directors may determine but the Directors shall be at liberty to waive payment of such interest either wholly or partly.

27. No member shall be entitled to receive any dividend or bonus or to be present and vote (save as proxy for another member) at any general meeting, either personally or by proxy, or be reckoned in a quorum, or to exercise any other privilege as a member until all sums or instalments due from him to the Company in respect of any call, whether alone or jointly with any other person, together with interest and expenses (if any) shall have been paid.

28. Any sum which by the terms of issue of a share becomes payable on allotment or on any fixed date (whether on account of the nominal value of the share or by way of premium or otherwise) shall for the purposes of these Articles be deemed to be a call duly made, notified and payable on the date on which, by the terms of issue, the same becomes payable and, in case of non-payment, all the relevant provisions of these Articles as to payment of interest and expenses, forfeiture or otherwise shall apply as if such sum had become payable by virtue of a call duly made and notified.

29. The Directors may make arrangements on the issue of shares for a difference between the holders in the amount of calls to be paid and in the times of payment.

30. The Directors may, if they think fit, receive from any member willing to advance the same, and either in money or money's worth, all or any part of the money uncalled and unpaid or instalments payable upon any shares held by him, and upon all or any of the moneys so advanced the Company may pay interest at such rate (if any) as the Directors may decide.  The Directors may at any time repay the amount so advanced upon giving to such member not less than one month's notice in writing of their intention in that regard, unless before the expiration of such notice the amount so advanced shall have been called up on the shares in respect of which it was advanced.  No such sum paid in advance of calls shall entitle the member paying such sum to any portion of a dividend declared in respect of any period prior to the date upon which such sum would, but for such payment, become presently payable.

FORFEITURE OF SHARES

31. If a member fails to pay any call or instalment of a call or to make any payment required by the terms of the issue on the day appointed for payment thereof, the Directors may, at any time thereafter during such time as any part of such call,  instalment or payment remains unpaid, serve a notice on him requiring payment of so much of the call,  instalment or payment as is unpaid, together with any interest which may have accrued and all expenses incurred by the Company by reason of such non-payment.

5

32. The notice shall name a day (not earlier than the expiration of fourteen days from the date of the notice) on or before which the payment required by the notice is to be made and shall state that, in the event of non-payment at or before the time appointed, the shares in respect of which the call was made will be liable to be forfeited.

33. If the requirements of any such notice as aforesaid are not complied with, any share in respect of which the notice has been given may, at any time thereafter before the payment required by the notice has been made, be forfeited by a resolution of the Directors to that effect.  Such forfeiture shall include all dividends and bonuses declared in respect of the forfeited share, and not actually paid before forfeiture.

34. A forfeited share may be sold or otherwise disposed of on such terms and in such manner as the Directors think fit and, at any time before a sale or disposition, the forfeiture may be cancelled on such terms as the Directors think fit.

35. A person whose shares have been forfeited shall cease to be a member in respect of the forfeited shares but shall, notwithstanding, remain liable to pay the Company all moneys which, at the date of forfeiture, were payable by him to the Company in respect of the shares together with interest thereon, but his liability shall cease if and when the Company receives payment in full of all moneys whenever payable in respect of the shares.

36. A certificate in writing under the hand of a Director or the Secretary of the Company that a share in the Company has been duly sold, forfeited or otherwise disposed of on a date stated in the declaration shall be conclusive evidence of the facts therein stated as against all persons claiming to be entitled to the share.  The Company may receive the consideration, if any, given for the share on any sale or disposition thereof and may execute a transfer of the share in favour of the person to whom the share is sold or otherwise disposed and he shall thereupon be registered as the holder of the share and shall not be bound to see to the application of the purchase money, if any, nor shall his title to the share be affected by any irregularity or invalidity in the proceedings in relation to the sale, forfeiture or disposal of the share.

37. The provisions of these Articles as to forfeiture shall apply in the case of non-payment of any sum which, by the terms of issue of a share, becomes payable at a fixed time (whether on account of the nominal value of the share or by way of premium or otherwise) as if the same had been payable by virtue of a call duly made and notified.

REGISTRATION OF EMPOWERING INSTRUMENTS

38. The Company shall be entitled to charge a fee not exceeding one dollar (US$l.00) on the registration of every probate, letter of administration, certificate of death or marriage, power of attorney, notice in lieu of distringas, or other instrument.

TRANSMISSION OF SHARES

39. In the case of the death of a member, the legal personal representative of a deceased sole shareholder shall be the only person recognised by the Company as having any title to the share.  In the case of a share registered in the names of two or more holders, the survivors or survivor, or the legal personal representatives of the deceased shareholder, shall be the only persons recognised by the Company as having any title to the share.  Provided however, that nothing herein contained shall release the estate of any such deceased holder from any liability in respect of any shares which had been held him solely or jointly with other persons.

40. Any person becoming entitled to a share in consequence of the death or bankruptcy or liquidation or dissolution of a member (or in any other way than by transfer) may, upon such evidence being produced as may from time to time be required by the Directors and subject as hereinafter provided, elect either to be registered as a member in respect of the share or to make such transfer of the share to such person as the deceased or bankrupt person could have made and to have such person registered as the transferee thereof, but the Directors shall, in either case, have the same right to decline or suspend registration as they would have had in the case of a transfer of the share by that member before his death or bankruptcy (as the case may be).  If the person so being entitled shall elect to be registered himself as holder he shall deliver or send to the Company a notice in writing signed by him stating that he so elects.

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41. A person becoming entitled to a share by reason of the death or bankruptcy or liquidation or dissolution of the holder (or in any other case than by transfer) shall be entitled to the same dividends and other advantages to which he would be entitled if he were the registered holder of the share, except that he shall not, before being registered as a member in respect of the share, be entitled in respect of it to exercise any right conferred by membership in relation to meetings of the Company.  The Directors may at any time give notice requiring any such person to elect either to be registered himself or to transfer the share and, if the notice is not complied with within ninety days, the Directors may, if such shares are redeemable at the option of the Company, redeem such shares but, in the meantime, the Directors may elect to withhold payment of all dividends, bonuses or other moneys payable in respect of the share until the requirements of the notice have been complied with.

ALTERATION OF SHARE CAPITAL

42. Subject to and in so far as permitted by the provisions of the Law, the Company may from time to time by Special Resolution alter or amend its Memorandum of Association with respect to any objects, powers or other matters specified therein provided always that the Company may by ordinary resolution:.

(a) increase the share capital by such amount as the Company in general meeting may determine,  provided that if the Company has no shares of a fixed amount it may increase its share capital by such number of shares without nominal or par value or may increase the aggregate consideration for which such shares may be issued;

(b) consolidate and divide all or any of its share capital into shares of larger amount than its existing shares;

(c) convert all or any part of its paid-up shares into stock and reconvert that stock into paid-up shares of any denomination;

(d) by subdivision of its existing shares or any of them divide the whole or any part of its share capital into shares of smaller amount than is fixed by the Memorandum of Association provided that the proportion of any amounts unpaid on the shares shall remain unchanged;or

(e) cancel any shares that at the date of the passing of the resolution have not been taken or agreed to be taken by any person and diminish its share capital by the amount such cancelled shares, provided that if the Company has no shares of a fixed amount it may diminish the number of shares into which its capital is divided.

43. All new shares created under the preceding Article shall be considered as though part of the original capital and shall be subject to the same provisions herein contained with reference to the payment of calls and instalments, transfer and transmission, forfeiture, lien, surrender and otherwise.

44. The Company may by Special Resolution, and subject to and in accordance with the provisions of the Law, reduce its share capital and any capital redemption reserve fund in any manner whatsoever.

45. Subject to the provisions of the Law, the Company may by resolution of the Directors change the location of its registered office.

CLOSING REGISTER OF MEMBERS OR FIXING RECORD DATE

46. Unless the Directors determine otherwise, the members entitled to receive notice of or to vote at a meeting of members or members entitled to receive payment of a dividend shall be the date on which notice of the meeting is mailed or the date on which the resolution of the Directors declaring such dividend is adopted, as the case may be, which shall be the record date for such determination of members.  When a determination of members entitled to vote at any meeting of members has been made as provided in this section, such determination shall apply to any adjournment thereof.

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STATUTORY MEETINGS

47. (a) Subject to paragraph (c) hereof, the Company shall within one (1) year of its incorporation and in each year of its existence thereafter hold a general meeting as its annual general meeting and shall specify the meeting as such in the notices calling it. The annual general meeting shall be held at such time and place as the Directors shall appoint and if no other time and place is prescribed by them, it shall be held at the registered office on the second Wednesday in December of each year at ten o’clock in the morning.

(b) At these meetings the report of the Directors (if any) shall be presented.

(c) The members may, by Ordinary Resolution, determine that no annual general meeting is to be held for a particular year or years or for an indefinite period.

GENERAL MEETINGS

48. The Directors may, whenever they think fit, convene a general meeting.  If, at any time, there are not sufficient Directors capable of acting to form a quorum, any Director or any one member of the Company may convene an extraordinary general meeting in the same manner as nearly as possible as that in which meetings may be convened by the Directors.

49. The Directors shall, upon the requisition in writing of one or more members holding in the aggregate not less than one tenth of such paid-up capital of the Company which, as at the date of the requisition, carries the right of voting at general meetings, convene a general meeting.  Any such requisition shall express the object of the meeting proposed to be called, shall be signed by the requisitionists and shall be left at the registered office of the Company.  If the Directors do not proceed to convene a general meeting within twenty one days from the date of such requisition being left as aforesaid, the requisitionists or any of them or any other member or members holding in the aggregate not less than one tenth of such paid-up capital of the Company which, as at the date of the requisition, carries the right of voting at general meetings, may convene an extraordinary general meeting to be held at such place and time as they shall appoint, subject to the Company's Articles as to notice.  Any such meeting so convened shall not be held after the expiration of three months after the expiration of the said twenty one days.

50. A general meeting convened as aforesaid by requisitionists shall be convened in the same manner as nearly as possible as that in which general meetings are to be convened by Directors.

NOTICE OF GENERAL MEETINGS

51. Subject to the provisions of the Law relating to Special Resolutions, seven days’ notice at the least (exclusive of the day on which the notice is served or deemed to be served but inclusive of the day for which the notice is given) specifying the place, the day and the hour of the general meeting and the general nature of the business shall be given in the manner hereinafter provided, or in such other manner (if any) as may be prescribed by the Company in general meeting, to such persons as are, under the Articles, entitled to receive such notices from the Company.  The notice convening a meeting to pass a special resolution shall specify the intention to propose the resolution as a special resolution.

52. Notwithstanding that a meeting of the Company is called by shorter notice than that referred to these Articles, it shall be deemed to have been duly called if it is so agreed by all the members of the Company entitled to attend and vote thereat or their proxies..

53. The accidental omission to give notice of a meeting to, or the non-receipt of a notice of a meeting by, any member entitled to receive notice shall not invalidate the proceedings at any meeting.

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PROCEEDINGS AT GENERAL MEETINGS

54. No business shall be transacted at any general meeting unless a quorum of members is present at the time when the meeting proceeds to business.  Members present in person or by proxy representing at least one third of the issued ordinary shares in the Company and entitled to vote shall be a quorum.

55. If, within half an hour from the time appointed for the meeting, a quorum is not present, the meeting, if convened upon the requisition of members, shall be dissolved. In any other case, it shall stand adjourned to the same day in the next week, at the same time and place and if, at the adjourned meeting, a quorum is not present within half an hour from the time appointed for the meeting the members present shall be a quorum and may transact the business for which the meeting was called.

56. The Chairman, if any, of the board of Directors shall preside as Chairman at every general meeting of the Company.  If there is no such Chairman, or if at any meeting he is not present within fifteen minutes after the time appointed for holding the meeting or is unwilling to act as Chairman, the Directors present shall choose one of their number to be Chairman of the meeting.

57. If at any general meeting no Director is willing to act as Chairman or if no Director is present within fifteen minutes after the time appointed for holding the meeting, the members present shall choose one of their number to be Chairman of the meeting.

58. The Chairman may, with the consent of any meeting at which a quorum is present (and shall if so directed by the meeting), adjourn the meeting from time to time and from place to place but no business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.  When a meeting is adjourned for thirty days or more, notice of the adjourned meeting shall be given as in the case of an original meeting.  Save as aforesaid, it shall not be necessary to give any notice of an adjournment or of the business to be transacted at an adjourned meeting.

59. At any general meeting, a resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is (before or on the declaration of the result of the show of hands) demanded by the Chairman of the meeting or any member present in person or by proxy entitled to vote.  Unless a poll is so demanded, a declaration by the Chairman of the meeting that a resolution has, on a show of hands, been carried, or carried unanimously, or by a particular majority, or lost, and an entry to that effect in the book of the proceedings of the Company shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour of, or against, that resolution.

60. If a poll is duly demanded it shall be taken in such manner as the Chairman of the meeting directs and the result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded.  A poll demanded on the election of the Chairman of the meeting or on a question of adjournment shall be taken forthwith. A poll demanded on any other question shall be taken at such time as the Chairman of the meeting directs and any business other than that upon which a poll has been demanded may be proceeded with pending the taking of the poll.  The demand for a poll may be withdrawn.

61. In the case of an equality of votes, whether on a show of hands or on a poll, the Chairman of the meeting at which the show of hands takes place or at which the poll is demanded shall be entitled to a second or casting vote.

VOTES OF MEMBERS

62. Except as otherwise required by law or as set forth herein, the holder of each share issued and outstanding shall have one vote for each share held by such holder, at the record date for determination of the members entitled to vote on such matters, or, if no such record date is established, at the date such vote is taken or any written consent of members is solicited.

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63. In the case of joint holders, the vote of the senior holder who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders and, for this purpose, seniority shall be determined by the order in which the names stand in the register of members.

64. A member of unsound mind, or in respect of whom an order has been made by any court having jurisdiction in lunacy, may vote, whether on a show of hands or on a poll, by his committee, receiver, curator bonis or other person in the nature of a committee, receiver or curator bonis appointed by that court and any such committee, receiver, curator bonis or other person may, on a poll, vote by proxy.

65. No member shall be entitled to vote at any general meeting unless he is registered as a member of the Company on the record date for such meeting and all calls or other such sums presently payable by him in respect of shares in the Company have been paid.

66. No objection shall be raised to the qualification of any voter except at the meeting or adjourned meeting at which the vote objected to is given or tendered, and every vote not disallowed at such meeting shall be valid for all purposes.  Any such objection made in due time shall be referred to the Chairman of the meeting whose decision shall be final and conclusive.

67. On a poll or a show of hands votes may be given personally or by proxy.

RESOLUTIONS IN WRITING

68. A resolution in writing (whether ordinary or special and whether in one or more counterparts) signed by all the members for the time being entitled to receive notice of and to attend and vote at general meetings (or, being corporations, by their duly authorised representatives) shall be as valid and effective as if the same had been passed at a general meeting of the Company duly convened and held.

PROXIES

69. Any member of the Company entitled to attend and vote at a meeting of the Company shall be entitled to appoint another person (who must be an individual) as his proxy to attend and vote instead of him and a proxy so appointed shall have the same right as the member to speak at the meeting.  The instrument appointing a proxy shall be deemed to confer authority to demand or join in demanding a poll.  On a poll votes may be given either personally or by proxy. A proxy need not be a member of the Company. A member may appoint any number of proxies to attend in his stead at any one general meeting (or at any one class meeting).

70. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised in writing or, if the appointer is a corporation, either under seal or under the hand of an officer or attorney duly authorised.

71. The instrument appointing a proxy and the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy of that power of attorney or other authority, shall be deposited at the registered office of the Company or at such other place as is specified for that purpose in the notice convening the meeting no later than the time  as the notice may specify before the time for holding the meeting or adjourned meeting at which the person named in the instrument proposed to vote and, in default, the instrument of proxy may, at the option of the Company, not be treated as valid.  The Chairman of the meeting may at his discretion direct that an instrument of proxy shall be deemed to have been duly deposited upon receipt of an electronic confirmation from the appointer that the instrument of proxy duly signed is in the course of transmission to the Company.

72. Every instrument of proxy, whether for a specified meeting or otherwise, shall be in common form or such other form as the Directors may from time to time approve, provided that it shall enable a member, according to his intention, to instruct his proxy to vote in favour of or against (or in default of instructions or in the event of conflicting instructions, to exercise his discretion in respect of) each resolution to be proposed at the meeting to which the form of proxy relates.

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73. A vote given in accordance with the terms of an instrument of proxy shall be valid notwithstanding the previous death or insanity of the principal or revocation of the proxy or of the authority under which the proxy was executed, or the transfer of the share in respect of which the proxy is given, provided that no intimation in writing of such death, insanity, revocation or transfer as aforesaid shall have been received by the Company at its registered office before the commencement of the meeting or adjourned meeting at which it is sought to use the proxy.

CORPORATIONS ACTING BY REPRESENTATIVES AT MEETINGS

74. Any corporation which is a member of the Company may, in accordance with its articles of association or, in the absence of such provision, by resolution of its directors or other governing body, authorise such person as it thinks fit to act as its representative at any meeting of the Company or of any class of members of the Company and the person so authorised shall be entitled to exercise the same powers on behalf of the corporation which he represents as that corporation could exercise if it were an individual member of the Company.

DIRECTORS AND OFFICERS

75. Until otherwise determined by the Company in general meeting, the number of Directors shall not be less than one or be more than ten and the names of the first Directors shall be determined in writing by a majority of the subscribers to the Memorandum of Association.

76. Thereafter, and subject as otherwise provided in these Articles, Directors shall be appointed by a resolution of the Company.  At a general meeting, a motion for the appointment of two or more persons as Directors may be made by a single resolution.

77. The remuneration to be paid to the Directors shall be such remuneration as the Directors shall determine. Such remuneration shall be deemed to accrue from day to day. The Directors shall also be entitled to be paid their travelling, hotel and other expenses properly incurred by them in going to, attending and returning from meetings of the Directors, or any committee of the Directors, or general meetings of the Company, or otherwise in connection with the business of the Company, or to receive a fixed allowance in respect thereof as may be determined by the Directors from time to time, or a combination partly of one such method and partly the other.

78. The Directors may by resolution award special remuneration to any Director of the Company undertaking any special work or services for, or undertaking any special mission on behalf of, the Company other than his ordinary routine work as a Director. Any fees paid to a Director who is also counsel or solicitor to the Company, or otherwise serves it in a professional capacity shall be in addition to his remuneration as a Director.

79. A Director or officer of the Company may hold any other office or place of profit under the Company (other than the office of auditor) in conjunction with his office of Director or officer of the Company for such period and on such terms (as to remuneration and otherwise) as the Directors may determine.

80. Any Director or officer of the Company may act by himself or his firm in a professional capacity for the Company and he or his firm shall be entitled to remuneration for professional services as if he were not a Director or officer provided that nothing herein contained shall authorise a Director or officer or his firm to act as auditor of the Company.

81. The share qualification for a Director may be fixed by the Company in general meeting and, unless and until so fixed, no qualification shall be required.

82. A Director or officer of the Company may be or become a director or other officer of, or otherwise interested in, any company promoted by the Company or in which the Company may be interested as shareholder or otherwise and no such Director or officer shall be accountable to the Company for any remuneration or other benefits received by him as a director or officer of, or from his interest in, such other company.

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83. No Director or officer of the Company shall be disqualified by his office from holding any office or place of profit under the Company or under any company in which the Company shall be a member or otherwise interested, or from contracting or dealing with the Company either as vendor, purchaser or otherwise, nor shall any such contract, or any contract or arrangement entered into by or on behalf of the Company in which any Director or officer shall be in any way interested, be avoided, nor shall any Director or officer be liable to account to the Company for any profit arising from any such office or place of profit or realised by any such contract or arrangement by reason only of such Director or officer holding that office or of the fiduciary relations thereby established, but it is declared that the nature of his interest must be disclosed by him at the meeting of the Directors at which the contract or arrangement is taken into consideration if his interest then exists, or in any other case at the first meeting of the Directors after the acquisition of his interest.  A general notice of disclosure or otherwise contained in the minutes of the meeting that a Director or officer is a member of any specified firm or company, and is to be regarded as interested in all transactions with that firm or company, shall be a sufficient disclosure under this Article as regards such Director or officer and the said transactions, and after such general notice it shall not be necessary for such Director or officer to give a special notice relating to any particular transaction with that firm or company.

84. A Director or officer of the Company may, notwithstanding his interest, be counted in the quorum present at any meeting at which he or any other Director or officer is appointed to hold any such office or place of profit under the Company or at which the terms of any such appointment are arranged and he may vote on any such appointment or arrangement other than his own appointment or the arrangement of the terms thereof.

ALTERNATE DIRECTORS

85. Any Director may in writing appoint any person to be his alternate to act in his place at any meeting of the Directors at which he is unable to attend.  Every such alternate shall be entitled to notice of meetings of the Directors and to attend and vote at such meetings as a Director when the person appointing him is not personally present and, where he is a Director, to have a separate vote on behalf of the Director he is representing in addition to his own vote.  An alternate shall vacate office if and when his appointer ceases to be a Director or removes the appointee from office.  Every such alternate shall be deemed for all purposes to be a Director and shall alone be responsible for his own acts and defaults and shall not be deemed to be the agent of the Director appointing him.  An alternate need not hold any share qualification.

POWERS AND DUTIES OF DIRECTORS

86. The business of the Company shall be managed by the Directors, who may pay all expenses incurred in setting-up and registering the Company and may exercise all such powers of the Company as are not, by the Law or these Articles, required to be exercised by the Company in general meeting subject, nevertheless, to any regulations of these Articles, to the provisions of the Law, and to such regulations, being not inconsistent with the aforesaid regulations or provisions, as may be prescribed by the Company in general meeting but no regulations made by the Company in general meeting shall invalidate any prior act of the Directors which would have been valid if that regulation had not been made.

87. The Directors may from time to time and at any time by power of attorney appoint any company, firm or person or body of persons, whether nominated directly or indirectly by the Directors, to be the attorney or attorneys of the Company for such purposes and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Directors under these Articles) and for such period and subject to such conditions as they may think fit and any such powers of attorney may contain such provisions for the protection and convenience of persons dealing with any such attorney as the Directors may think fit and may also authorise any such attorney to delegate all or any of the powers, authorities and discretions vested in him.

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88. All cheques, promissory notes, drafts, bills of exchange and other negotiable instruments, and all receipts for moneys paid to the Company, shall be signed, drawn, accepted, endorsed or otherwise executed, as the case may be, in such manner as the Directors shall from time to time by resolution determine.

89. The Directors shall cause minutes to be made in books provided for the purpose:

(a) of all appointments of officers of the Company made by the Directors;

(b) of the names of the Directors present at each meeting of the Directors and of any committee of the Directors; and

of all resolutions and proceedings at each meeting of the Company and of the Directors and of any committee of the Directors.

90. The Directors may, on behalf of the Company, pay a gratuity or pension or allowance on retirement to any Director who has held any other salaried office or place of profit with the Company or to his widow or dependents and may make contributions to any fund and pay premiums for the purchase or provision of any such gratuity, pension or allowance.

91. The Directors may exercise all the powers of the Company to borrow money and to mortgage or charge its undertaking, property and uncalled capital, or any part thereof, and to issue debentures, debenture stock, bonds and other securities whether outright or as security for any debt, liability or obligation of the Company or of any third party.

MANAGEMENT

92. (a) The Directors may from time to time provide for the management of the affairs of the Company in such manner as they shall think fit and the provisions contained in the three next following paragraphs shall be without prejudice to the general powers conferred by this paragraph.

(b) The Directors from time to time and at any time may establish any committees, local boards or agencies for managing any of the affairs of the Company and may appoint any persons to be members of such committees or local boards or any managers or agents and may fix their remuneration.

(c) The Directors from time to time and at any time may delegate to any such committee, local board, manager or agent any of the powers, authorities and discretions for the time being vested in the Directors and may authorise the members for the time being of any such local board, or any of them to fill up any vacancies therein and to act notwithstanding vacancies and any such appointment or delegation may be made on such terms and subject to such conditions as the Directors may think fit and the Directors may at any time remove any person so appointed and may annul or vary any such delegation, but no person dealing in good faith and without notice of any such annulment or variation shall be affected thereby.

(d) Any such delegates as aforesaid may be authorised by the Directors to sub-delegate all or any of the powers, authorities, and discretions for the time being vested in them.

MANAGING DIRECTOR

93. The Directors may from time to time appoint one or more of their body (but not an alternate Director) to the office of Managing Director on such terms and at such remuneration (whether by way of salary or commission or participation in profits or partly in one way and partly in another) as they may think fit but his appointment shall be subject to determination ipso facto if he ceases from any cause to be Director and no alternate Director appointed by him can act in his stead as Director or Managing Director.

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PROCEEDINGS OF DIRECTORS

94. The Directors shall meet together for the conduct of business, convening, adjourning and otherwise regulating their meetings as they think fit. Questions arising at any meeting shall be decided by a majority of votes of the Directors and alternate Directors present at a meeting at which there is a quorum, the vote of an alternate Director not being counted if his appointer is present at such meeting. In case of an equality of votes, the Chairman shall have a second or casting vote.

95. The quorum necessary for the transaction of the business of the Directors may be fixed by the Directors and, unless so fixed, shall be two provided always that, if there is only a sole Director, that Director shall be a quorum and such Director may transact business by written resolution as if a meeting were being held under the provisions of these Articles.

96. The continuing Directors or sole continuing Director may act notwithstanding any vacancy in their body, but, if and so long as their number is reduced below the number fixed by or pursuant to these Articles as the necessary quorum of Directors, the continuing Directors or Director may act for the purpose of increasing the number of Directors to that number, or of summoning a general meeting of the Company, but for no other purpose.

97. The Directors may elect a Chairman of their meetings and determine the period for which he is to hold office but if no such Chairman is elected, or if at any meeting the Chairman is not present within five minutes after the time appointed for holding the same, the Directors present may choose one of their number to be Chairman of the meeting.

98. The Directors may delegate any of their powers to committees consisting of such member or members of the board of Directors (iincluding alternate Directors in the absence of their appointers) as they think fit.  Any committee so formed shall, in the exercise of the powers so delegated, conform to any regulations that may be imposed on it by the Directors.

99. A committee may meet and adjourn as it thinks proper. Questions arising at any meeting shall be determined by a majority of votes of the members present, and in the case of an equality of votes the Chairman shall have a second or casting vote.

100. All acts done by any meeting of the Directors or of a committee of Directors (including any person acting as an alternate Director) or by any person acting as a Director shall, notwithstanding that it be afterwards discovered that there was some defect in the appointment  of any such Director or alternate Director, or that they or any of them were disqualified or had vacated office, or were not entitled to vote, be as valid as if every such person had been duly appointed and was qualified to be a Director or alternate Director as the case may be.

101. members of the board of Directors or of any committee thereof may participate in a meeting of the board or of such committee by means of conference telephone or other electronic means by which all persons participating in the meeting can hear each other and participation in a meeting pursuant to this provision shall constitute presence in person at such meeting. A resolution in writing (in one or more counterparts), signed by all the Directors for the time being or all the members of a committee of Directors (an alternate Director being entitled to sign such resolution on behalf of his appointer) shall be as valid and effectual as if it had been passed at a meeting of the Directors or committee as the case may be duly convened and held.

VACATION OF OFFICE OF DIRECTOR

102. The office of Director shall, ipso facto, be vacated if the Director:

(a) dies; or

(b) becomes bankrupt or makes any arrangement or composition with his creditors generally; or

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(c) is found to be a lunatic or becomes of unsound mind; or

(d) resigns his office by notice in writing to the Company; or

(e) he shall for more than three consecutive meetings have been absent from Directors’ meetings (without being represented by an alternate Director) without permission of the Directors and the remaining Directors resolve that his office be vacated.

APPOINTMENT AND REMOVAL OF DIRECTORS
   

103. The Directors shall hold and continue in office until they are removed from office under the terms of these Articles or until they resign.

104. The Company may, by Ordinary Resolution, appoint any person to be a Director, remove any Director and/or appoint another person in his stead.

105. The Directors shall have the power at any time, and from time to time, to appoint any person to be a Director, either to fill a casual vacancy or as an addition to the existing Directors, but so that the total number of Directors (exclusive of alternate Directors) shall not at any time exceed the number fixed in accordance with these Articles.

PRESUMPTION OF ASSENT

106. A Director who is present at a meeting of the board of Directors at which action on any Company matter is taken shall be presumed to have assented to the action taken unless his dissent shall be entered in the minutes of the meeting or unless he shall file his written dissent from such action with the person acting as the Secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to the Secretary immediately after the adjournment of the meeting. Such right of dissent shall not apply to a Director who voted in favour of such action.

SEAL
 

107. (a) The Company may, if the Directors so determine, have a Seal which shall, subject to paragraph (c) hereof, only be used by the authority of the Directors or of a committee of the Directors authorised by the Directors in that behalf and every instrument to which the Seal has been affixed shall be signed by one person who shall be either a Director or the Secretary or Secretary-Treasurer or some person appointed by the Directors for the purpose.

(b) The Company may have a duplicate Seal or Seals each of which shall be a facsimile of the Common Seal of the Company and, if the Directors so determine, with the addition on its face of the name of every place where it is to be used.

(c) A Director, Secretary or other officer or representative or attorney may without further authority of the Directors affix the Seal of the Company over his signature alone to any document of the Company required to be authenticated by him under Seal or to be filed with the Registrar of Companies in the Cayman Islands or elsewhere wheresoever.

OFFICERS

108. The Company may have a President, a Secretary or Secretary-Treasurer appointed by the Directors who may also from time to time appoint such other officers as they consider necessary, all for such terms, at such remuneration and to perform such duties, and subject to such provisions as to disqualification and removal as the Directors from time to time prescribe.

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DIVIDENDS AND RESERVES

109. Subject to the Law, the Directors may from time to time declare dividends (including interim dividends) and distributions on shares of the Company outstanding and authorise payment of the same out of the profits and reserves of the Company lawfully available therefor.

110. The Directors may, before declaring any dividends or distributions, set aside such sums as they think proper as a reserve or reserves which shall, at the discretion of the Directors, be applicable for any purpose of the Company and pending such application may, at the like discretion, either be employed in the business of the Company or be invested in such investments (other than shares of the Company) as the Directors may from time to time think fit.  The Directors may also, without placing the same to reserve, carry forward any profits which they may think prudent not to dividend.

111. No dividend or distribution shall be payable except out of the profits of the Company, realised or unrealised, or out of the share premium account or as otherwise permitted by the Law.

112. Subject to the rights of persons, if any, entitled to shares with special rights as to dividends or distributions, all dividends or distributions shall be declared and paid according to the amounts paid or credited as paid on the shares in respect whereof the dividend is paid but no amount paid or credited as paid on a share in advance of calls shall be treated for the purposes of this Article as paid on the share.

113. The Directors may deduct from any dividend or distribution payable to any Member all sums of money (if any) presently payable by him to the Company on account of calls or otherwise.

114. The Directors may declare that any dividend or distribution may be paid either wholly or partly by the distribution of specific assets and, in particular, of paid-up shares or debentures of any other company or in any one or more of such ways.  Where any difficulty arises in regard to such distribution, the Directors may settle the same as they think expedient and, in particular, may issue fractional certificates and fix the value for distribution of such specific assets or any part thereof and may determine that cash payments shall be made to any members upon the footing of the value so fixed, in order to adjust the rights of all members, and may vest any such specific assets in trustees upon trust for the members entitled to the dividend as may seem expedient to the Directors.

115. Any dividend, interest or other moneys payable in cash in respect of shares may be paid by cheque or warrant sent through the post directed to the registered address of the member or person entitled thereto or, in the case of joint holders, to any one of such joint holders at his registered address or to such person and such address as the member or person entitled or such joint holders, as the case may be, may direct.  Every such cheque or warrant shall be made payable to the order of the person to whom it is sent or to the order of such other person as the member or person entitled or such joint holders, as the case may be, may direct.

116. If several persons are registered as joint holders of any share, any of them may give effectual receipts for any dividends, bonuses or other moneys payable on or in respect of the share.

117. No dividend shall bear interest against the Company.

118. All dividends unclaimed for one year after having been declared may be invested or otherwise made use of by the Directors for the benefit of the Company until claimed and the Company shall not be constituted a trustee in respect thereof.  All dividends unclaimed for a period of twelve years after having been declared shall be forfeited and shall revert to the Company.

CAPITALISATION OF PROFITS

     

119. The Company in general meeting may, upon the recommendation of the Directors, resolve that it is desirable to capitalise any part of the amount for the time being standing to the credit of any of the Company's reserve accounts or to the credit of the profit and loss account or otherwise available for distribution and not required for the payment or provision of the fixed dividend on any shares entitled to fixed preferential dividends and accordingly that such sums be set free for distribution amongst the members who would have been entitled thereto if distributed by way of dividend and in the same proportions on condition that the same be not paid in cash but be applied either in or towards paying up any amounts for the time being unpaid on any shares held by such members respectively or paying up in full unissued shares or debentures of the Company to be allotted and distributed credited as fully paid-up to and amongst such members in the proportion aforesaid, or partly in the one way and partly in the other, and the Directors shall give effect to such resolution provided that a share premium account and a capital redemption reserve fund may, for the purposes of this Article, only be applied in the paying-up of unissued shares to be issued to members as fully paid bonus shares.

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120. Whenever such a resolution as aforesaid has been passed, the Directors shall make all appropriations and applications of the undivided profits or balances standing to the credit of the relevant reserve account resolved to be capitalised thereby and all allotments and issues of fully paid shares or debentures, if any, and generally shall do all acts and things required to give effect thereto, with full power to the Directors to make such provision by the issue of fractional certificates or by payment in cash or otherwise as they think fit for the case of shares or debentures becoming distributable in fractions, and also to authorise any person to enter on behalf of all members entitled thereto into an agreement with the Company providing for the allotment to them respectively, credited as fully paid-up, of any further shares or debentures to which they may be entitled upon such capitalisation, or as the case may require, for the payment up by the Company on their behalf, by the application thereto of their respective proportions of the profits resolved to be capitalised, of the amounts or any part of the amounts remaining unpaid on their existing shares, and any agreement made under such authority shall be effective and binding on all such members.

BOOKS OF ACCOUNT
  

121. The Directors shall cause proper books of account to be kept with respect to:

(a) all sums of money received and expended by the Company and the matters in respect of which the receipt and expenditure takes place;

(b) all sales and purchases of goods by the Company; and

(c) the assets and liabilities of the Company.

Proper books of account shall not be deemed to be kept with respect to the matters aforesaid if there are not kept such books of account as are necessary to give a true and fair view of the state of the Company's affairs and to explain its transactions.

122. The Directors shall from time to time determine whether and to what extent and at what times and places and under what conditions or regulations the accounts and books of the Company or any of them shall be open to the inspection of members not being Directors and no member (not being a Director) shall have any right of inspecting any account or book or document of the Company except as conferred by law or authorised by the Directors or by the Company in general meeting other than the audited annual financial statements which shall be provided to members in such manner as determined by the Directors.

123. The Directors may from time to time cause to be prepared and to be laid before the Company in general meeting profit and loss accounts, balance sheets, group accounts (if any) and such other reports and accounts as may be required by law.

AUDIT

124. The Company may at any annual general meeting appoint an Auditor or Auditors of the Company who shall hold office until the next annual general meeting and may fix his or their remuneration.

125. The Directors may before the first annual general meeting appoint an Auditor or Auditors of the Company who shall hold office until the first annual general meeting unless previously removed by an ordinary resolution of the members in general meeting in which case the members at that meeting may appoint the Auditors.  The Directors may fill any casual vacancy in the office of Auditor but while any such vacancy continues the surviving or continuing Auditor or Auditors, if any, may act.  The remuneration of any Auditor appointed by the Directors under this Article may be fixed by the Directors.

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126. Every Auditor of the Company shall have a right of access at all times to the books and accounts and vouchers of the Company and shall be entitled to require from the Directors and Officers of the Company such information and explanation as may be necessary for the performance of the duties of the auditors.

127. Auditors shall at the next annual general meeting following their appointment and at any other time during their term of office, upon request of the Directors or any general meeting of the members, make a report on the accounts of the Company in general meeting during their tenure of office.

NOTICES

128. Notices shall be in writing and may be given by the Company to any Member either personally or by sending it by post, cable, telex or telecopy to him or to his address as shown in the register of members, such notice, if mailed, to be forwarded airmail if the address be outside the Cayman Islands.

129. (a) Where a notice is sent by post, service of the notice shall be deemed to be effected by properly addressing, pre-paying and posting a letter containing the notice, and to have been effected at the expiration of sixty (60) hours after the letter containing the same is posted as aforesaid.

(b) Where a notice is sent by cable, telex, or telecopy, service of the notice shall be deemed to be effected by properly addressing, and sending such notice through a transmitting organization and to have been effected on the day the same is sent as aforesaid

130. A notice may be given by the Company to the joint holders of a share by giving the notice to the joint holder named first in the register of members in respect of the share.

131. A notice may be given by the Company to the persons entitled to a share in consequence of the death or bankruptcy of a member by sending it through the post in a prepaid letter addressed to them by name, or by the title of representatives of the deceased, or trustee of the bankruptcy, or by any like description at the address, if any, supplied for the purpose by the persons claiming to be so entitled or (until such an address has been so supplied) by giving the notice in any manner in which the same might have been given if the death or bankruptcy had not occurred.

132. Notice of every general meeting shall be given in any manner hereinbefore authorised to:

(a) every member holding shares entitling the holder thereof to attend meetings of the Company except those members who have not supplied to the Company an address for the giving of notices to them; and

(b) every person entitled to a share in consequence of the death or bankruptcy of a member who, but for his death or bankruptcy, would be entitled to receive notice of the meeting.

No other person shall be entitled to receive notices of general meetings.

LIQUIDATION OF THE COMPANY

133. If the Company shall be wound up the liquidator may, with the sanction of a Special Resolution and any other sanction required by the Law, divide amongst the members in specie or kind the whole or any part of the assets of the Company (whether they shall consist of property of the same kind or not) and may for such purpose set such value as he deems fair upon any property to be divided as aforesaid and may determine how such division shall be carried out as between members or different classes of members.  The liquidator may with the like sanction vest the whole or any part of the assets in trustees upon such trusts for the benefit of contributories as the liquidator, with the like sanction, shall think fit but so that no member shall be compelled to accept any shares or other securities whereon there is any liability.

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INDEMNITY

134. Every Director or other officer of the Company and their heirs and personal representatives shall be entitled to be indemnified and held harmless out of the assets of the Company against all actions, proceedings, costs, damages, expenses (including reasonable legal and/or accountancy fees), claims, losses or liabilities which he may sustain or incur in or about the execution of the duties of his office or otherwise in relation thereto, including any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgment is given in his favour or in which he is acquitted, and no Director or person as aforementioned shall be liable for any loss, damage or misfortune which may happen to or be incurred by the Company in the execution of the duties of his office or in relation thereto provided that he acted in good faith and in a manner reasonably believed by him to be in the best interests of the Company and provided further that his actions did not involve wilful default, fraud or dishonesty.

FINANCIAL YEAR

135. Unless the Directors otherwise prescribe, the financial year of the Company shall end on 31 December in each year and shall begin on 1 January in each year.

AMENDMENT OF MEMORANDUM AND ARTICLES

136. Subject to the provisions of the Law, the Company may by Special Resolution change its name, amend its objects or alter or amend these Articles either in whole or in part.

TRANSFER BY WAY OF CONTINUATION

137. If the Company is exempted as defined in the Law, it shall, subject to the provisions of the Law, and with the sanction of a Special Resolution, have the power to register by way of continuation as a body corporate under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands.

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EX-4.2

Exhibit 4.2

Grand Farm Inc.

NAME AND ADDRESS OF SHAREHOLDER	CERTIFICATE NUMBER	DISTINCTIVE NUMBERS		PAR VALUE PER SHARE
		FROM	TO
	DATE OF ISSUE	NO. OF SHARES		CONSIDERATION PAID

SPECIMEN

SHARE CERTIFICATE

OF

Grand Farm Inc.

INCORPORATED IN THE CAYMAN ISLANDS

Authorized Capital: US$200,000.00 divided into 100,000,000 shares of a nominal or par value of US$0.002 each

THIS IS TO CERTIFY THAT THE UNDERMENTIONED PERSON IS THE REGISTERED HOLDER OF THE SHARES SPECIFIED HEREUNDER SUBJECT TO THE RULES AND LAWS GOVERNING THE ADMINISTRATION OF THE COMPANY

SHAREHOLDER	NO. OF SHARES	DISTINCTIVE NUMBER		CERTIFICATE NUMBER	DATE OF ISSUE
		FROM	TO

GIVEN UNDER THE COMMON SEAL OF THE COMPANY ON THE DATE STATED ABOVE AND IN THE PRESENCE OF

DIRECTOR DIRECTOR/SECRETARY

NO TRANSFER OF ANY OF THE ABOVE SHARES CAN BE REGISTERED UNLESS ACCOMPANIED BY THIS CERTIFICATE

EX-4.3

DEPOSIT AGREEMENT

by and among

GRAND FARM INC.

as Issuer,

DEUTSCHE BANK TRUST COMPANY AMERICAS

as Depositary,

AND

THE HOLDERS AND BENEFICIAL OWNERS

OF AMERICAN DEPOSITARY SHARES EVIDENCED BY

AMERICAN DEPOSITARY RECEIPTS ISSUED HEREUNDER

Dated as of [●], 2011

DEPOSIT AGREEMENT

DEPOSIT AGREEMENT, dated as of [●], 2011, by and among (i) Grand Farm Inc., a company incorporated in the Cayman Islands, with its principal executive office at [No.2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, China 351111] and its successors (the “Company”), (ii) Deutsche Bank Trust Company Americas, an indirect wholly owned subsidiary of Deutsche Bank A.G., acting in its capacity as depositary, with its principal office at 60 Wall Street, New York, NY 10005, United States of America and any successor depositary hereunder (the “Depositary”), and (iii) all Holders and Beneficial Owners of American Depositary Shares evidenced by American Depositary Receipts issued hereunder (all such capitalized terms as hereinafter defined).

WITNESSETH THAT:

WHEREAS, the Company desires to establish an ADR facility with the Depositary to provide for the deposit of the Shares and the creation of American Depositary Shares representing the Shares so deposited; and

WHEREAS, the Depositary is willing to act as the Depositary for such ADR facility upon the terms set forth in this Deposit Agreement; and

WHEREAS, the American Depositary Receipts evidencing the American Depositary Shares issued pursuant to the terms of this Deposit Agreement are to be substantially in the forms of Exhibit A and Exhibit B annexed hereto, with appropriate insertions, modifications and omissions, as hereinafter provided in this Deposit Agreement; and

WHEREAS, the American Depositary Shares to be issued pursuant to the terms of this Deposit Agreement are accepted for trading on the Nasdaq Capital Market; and

WHEREAS, the Board of Directors of the Company (or an authorized committee thereof) has duly approved the establishment of an ADR facility upon the terms set forth in this Deposit Agreement, the execution and delivery of this Deposit Agreement on behalf of the Company, and the actions of the Company and the transactions contemplated herein.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I.

DEFINITIONS

All capitalized terms used, but not otherwise defined, herein shall have the meanings set forth below, unless otherwise clearly indicated:

SECTION 1.1  “Affiliate” shall have the meaning assigned to such term by the Commission under Regulation C promulgated under the Securities Act.

SECTION 1.2  “Agent” shall mean such entity or entities as the Depositary may appoint under Section 7.8 hereof, including the Custodian or any successor or addition thereto.

SECTION 1.3  “American Depositary Share(s)” and “ADS(s)” shall mean the securities represented by the rights and interests in the Deposited Securities granted to the Holders and Beneficial Owners pursuant to this Deposit Agreement and evidenced by the American Depositary Receipts issued hereunder.  Each American Depositary Share shall represent the right to receive [●] Shares, until there shall occur a distribution upon Deposited Securities referred to in Section 4.2 hereof or a change in Deposited Securities referred to in Section 4.9 hereof with respect to which additional American Depositary Receipts are not executed and delivered and thereafter each American Depositary Share shall represent the Shares or Deposited Securities specified in such Sections.

SECTION 1.4  “Article” shall refer to an article of the American Depositary Receipts as set forth in the Form of Face of Receipt and Form of Reverse of Receipt in Exhibit A and Exhibit B annexed hereto.

SECTION 1.5  “Articles of Association” shall mean the articles of association of the Company.

SECTION 1.6  “ADS Record Date” shall have the meaning given to such term in Section 4.7 hereof.

SECTION 1.7  “Beneficial Owner” shall mean as to any ADS, any person or entity having a beneficial interest in such ADS.  A Beneficial Owner need not be the Holder of the ADR evidencing such ADSs.  A Beneficial Owner may exercise any rights or receive any benefits hereunder solely through the Holder of the ADR(s) evidencing the ADSs in which such Beneficial Owner has an interest.

SECTION 1.8  “Business Day” shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not (a) a day on which banking institutions in the Borough of Manhattan, The City of New York are authorized or obligated by law or executive order to close and (b) a day on which the market(s) in which Receipts are traded are closed.

SECTION 1.9  “Commission” shall mean the Securities and Exchange Commission of the United States or any successor governmental agency in the United States.

SECTION 1.10  “Company” shall mean Grand Farm Inc., a company incorporated and existing under the laws of the Cayman Islands, and its successors.

SECTION 1.11  “Corporate Trust Office” when used with respect to the Depositary, shall mean the corporate trust office of the Depositary at which at any particular time its depositary receipts business shall be administered, which, at the date of this Deposit Agreement, is located at 60 Wall Street, New York, New York 10005, U.S.A.

SECTION 1.12  “Custodian” shall mean, as of the date hereof, [Deutsche Bank AG, Hong Kong Branch, having its principal office at 57/F International Commerce Centre, 1 Austin Road West, Kowloon, Hong Kong S.A.R., People’s Republic of China], as the custodian for the purposes of this Deposit Agreement, and any other firm or corporation which may hereinafter be appointed by the Depositary pursuant to the terms of Section 5.5 hereof as a successor or an additional custodian or custodians hereunder, as the context shall require.  The term “Custodian” shall mean all custodians, collectively.

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SECTION 1.13  “Deliver”, “Deliverable” and “Delivery” shall mean, when used in respect of American Depositary Shares, Receipts, Deposited Securities and Shares, the physical delivery of the certificate representing such security, or the electronic delivery of such security by means of book-entry transfer (except with respect to the Shares), as appropriate, including, without limitation, through DRS/Profile.  With respect to DRS/Profile ADRs, the terms “execute”, “issue”, “register”, “surrender”, “transfer” or “cancel” refer to applicable entries or movements to or within DRS/Profile.

SECTION 1.14  “Deposit Agreement” shall mean this Deposit Agreement and all exhibits annexed hereto, as the same may from time to time be amended and supplemented in accordance with the terms hereof.

SECTION 1.15  “Depositary” shall mean Deutsche Bank Trust Company Americas, an indirect wholly owned subsidiary of Deutsche Bank AG, in its capacity as depositary under the terms of this Deposit Agreement, and any successor depositary hereunder.

SECTION 1.16  “Deposited Securities” as of any time shall mean Shares at such time deposited or deemed to be deposited under this Deposit Agreement and any and all other securities, property and cash received or deemed to be received by the Depositary or the Custodian in respect thereof and held hereunder, subject, in the case of cash, to the provisions of Section 4.6 hereof and, in the case of collateral delivered in connection with Pre-Release Transactions, to the provisions of Section 2.10 hereof.

SECTION 1.17  “Dollars” and “$” shall mean the lawful currency of the United States.

SECTION 1.18  “DRS/Profile” shall mean the system for the uncertificated registration of ownership of securities pursuant to which ownership of ADSs is maintained on the books of the Depositary without the issuance of a physical certificate and transfer instructions may be given to allow for the automated transfer of ownership between the books of DTC and the Depositary.  Ownership of ADSs held in DRS/Profile are evidenced by periodic statements issued by the Depositary to the Holders entitled thereto.

SECTION 1.19  “DTC” shall mean The Depository Trust Company, the central book-entry clearinghouse and settlement system for securities traded in the United States, and any successor thereto.

SECTION 1.20  “Exchange Act” shall mean the U.S. Securities Exchange Act of 1934, as from time to time amended.

SECTION 1.21  “Foreign Currency” shall mean any currency other than Dollars.

SECTION 1.22  “Foreign Registrar” shall mean the entity, if any, that carries out the duties of registrar for the Shares or any successor as registrar for the Shares and any other appointed agent of the Company for the transfer and registration of Shares or, if no such agent is so appointed and acting, the Company.

SECTION 1.23  “Holder” shall mean the person in whose name a Receipt is registered on the books of the Depositary (or the Registrar, if any) maintained for such purpose.  A Holder may or may not be a Beneficial Owner.  A Holder shall be deemed to have all requisite authority to act on behalf of the Beneficial Owners of the ADRs registered in such Holder’s name.

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SECTION 1.24  “Indemnified Person” and “Indemnifying Person” shall have the meaning set forth in Section 5.8 hereof.

SECTION 1.25  “Memorandum” shall mean the memorandum of association of the Company.

SECTION 1.26  “Opinion of Counsel” shall mean a written opinion from legal counsel to the Company who is acceptable to the Depositary.

SECTION 1.27  “Pre-Release Transaction” shall have the meaning set forth in Section 2.10 hereof.

SECTION 1.28  “Receipt(s); “American Depositary Receipt(s)”; and “ADR(s)” shall mean the certificate(s) or statements issued by the Depositary evidencing the American Depositary Shares issued under the terms of this Deposit Agreement, as such Receipts may be amended from time to time in accordance with the provisions of this Deposit Agreement.  References to Receipts shall include physical certificated Receipts as well as ADSs issued through DRS/Profile, unless the context otherwise requires.

SECTION 1.29  “Registrar” shall mean the Depositary or any bank or trust company having an office in the Borough of Manhattan, The City of New York, which shall be appointed by the Depositary to register ownership of Receipts and transfer of Receipts as herein provided, shall include any co-registrar appointed by the Depositary for such purposes.  Registrars (other than the Depositary) may be removed and substitutes appointed by the Depositary.

SECTION 1.30  “Restricted ADRs” shall have the meaning set forth in Section 2.11 hereof.

SECTION 1.31  “Restricted ADSs” shall have the meaning set forth in Section 2.11 hereof.

SECTION 1.32  “Restricted Securities” shall mean Shares, or American Depositary Shares representing such Shares, which (i) have been acquired directly or indirectly from the Company or any of its Affiliates in a transaction or chain of transactions not involving any public offering and subject to resale limitations under the Securities Act or the rules issued thereunder, (ii) are held by an officer or director (or persons performing similar functions) or other Affiliate of the Company or (iii) are subject to other restrictions on sale or deposit under the laws of the United States or the Cayman Islands, under a shareholders’ agreement, shareholders’ lock-up agreement or the Articles of Association or under the regulations of an applicable securities exchange unless, in each case, such Shares are being sold to persons other than an Affiliate of the Company in a transaction (x) covered by an effective resale registration statement or (y) exempt from the registration requirements of the Securities Act (as hereafter defined) and the Shares are not, when held by such person, Restricted Securities.

SECTION 1.33  “Restricted Shares” shall have the meaning set forth in Section 2.11 hereof.

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SECTION 1.34  “Securities Act” shall mean the United States Securities Act of 1933, as from time to time amended.

SECTION 1.35  “Shares” shall mean ordinary shares in registered form of the Company, par value $[●] each, heretofore or hereafter validly issued and outstanding and fully paid.  References to Shares shall include evidence of rights to receive Shares, whether or not stated in the particular instance; provided, however, that in no event shall Shares include evidence of rights to receive Shares with respect to which the full purchase price has not been paid or Shares as to which pre-emptive rights have theretofore not been validly waived or exercised; and provided further, however, that, if there shall occur any change in par value, split-up, consolidation, reclassification, conversion or any other event described in Section 4.9 hereof in respect of the Shares, the term “Shares” shall thereafter, to the extent permitted by law, represent the successor securities resulting from such change in par value, split-up, consolidation, exchange, conversion, reclassification or event.

SECTION 1.36  “United States” or “U.S.” shall mean the United States of America.

ARTICLE II.

APPOINTMENT OF DEPOSITARY; FORM OF RECEIPT; DEPOSIT OF SHARES; EXECUTION AND DELIVERY, TRANSFER AND SURRENDER OF RECEIPTS

SECTION 2.1  Appointment of Depositary.  The Company hereby appoints the Depositary as exclusive depositary for the Deposited Securities and hereby authorizes and directs the Depositary to act in accordance with the terms set forth in this Deposit Agreement.  Each Holder and each Beneficial Owner, upon acceptance of any ADSs (or any interest therein) issued inaccordance with the terms of this Deposit Agreement, shall be deemed for all purposes to (a) be a party to and bound by the terms of this Deposit Agreement and (b) appoint the Depositary its attorney-in-fact, with full power to delegate, to act on its behalf and to take any and all actions contemplated in this Deposit Agreement, to adopt any and all procedures necessary to comply with applicable law and to take such action as the Depositary in its sole discretion may deem necessary or appropriate to carry out the purposes of this Deposit Agreement (the taking of such actions to be the conclusive determinant of the necessity and appropriateness thereof).

SECTION 2.2  Form and Transferability of Receipts.

(a)           Form.  Receipts in certificated form shall be substantially in the forms set forth in Exhibit A and Exhibit B annexed to this Deposit Agreement, with appropriate insertions, modifications and omissions, as hereinafter provided.  Receipts may be issued in denominations of any number of American Depositary Shares.  No Receipt in certificated form shall be entitled to any benefits under this Deposit Agreement or be valid or obligatory for any purpose, unless such Receipt shall have been executed by the Depositary by the manual or facsimile signature of a duly authorized signatory of the Depositary.  The Depositary shall maintain books on which each Receipt so executed and Delivered, in the case of Receipts in certificated form, and each Receipt issued through any book-entry system, including, without limitation, DRS/Profile, in either case as hereinafter provided, and the transfer of each such Receipt shall be registered.  Receipts in certificated form bearing the manual or facsimile signature of a duly authorized signatory of the Depositary who was at any time a proper signatory of the Depositary shall bind the Depositary, notwithstanding that such signatory has ceased to hold such office prior to the execution and Delivery of such Receipts by the Registrar or did not hold such office on the date of issuance of such Receipts.

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Notwithstanding anything in this Deposit Agreement or in the form of Receipt to the contrary, the Depositary may, in its discretion, issue ADRs, including Restricted ADRs, in certificated form or through any book-entry system, including, without limitation, DRS/Profile, and Holders of ADRs shall only be entitled to receive Receipts in certificated form to the extent the Depositary has made Receipts in certificated form available at the expense of the Company (i) in its sole discretion, or (ii) (a) during a continuous period lasting at least 14 days during which DTC ceases to operate as a book-entry clearing house and settlement system (other than by reason of holidays, statutory or otherwise) or (b) if DTC announces an intention permanently to cease and subsequently ceases business as a book-entry clearing house and settlement system and no alternative book-entry clearing house and settlement system satisfactory to the Depositary is available within 45 days.  Holders and Beneficial Owners shall be bound by the terms and conditions of this Deposit Agreement and of the form of Receipt, regardless of whether their Receipts are in certificated form or are issued throughany book-entry system, including, without limitation, DRS/Profile.

(b)           Legends.  In addition to the foregoing, the Receipts may, and upon the written request of the Company shall, be endorsed with, or have incorporated in the text thereof, such legends or recitals or modifications not inconsistent with the provisions of this Deposit Agreement as may be (i) necessary to enable the Depositary and the Company to perform their respective obligations hereunder, (ii) required to comply with any applicable laws or regulations, or with the rules and regulations of any securities exchange or market upon which ADSs may be traded, listed or quoted, or to conform with any usage with respect thereto, (iii) necessary to indicate any special limitations or restrictions to which any particular ADRs or ADSs are subject by reason of the date of issuance of the Deposited Securities or otherwise or (iv) required by any book-entry system in which the ADSs are held.  Holders and Beneficial Owners shall be deemed, for all purposes, to have notice of, and to be bound by, the terms and conditions of the legends set forth, in the case of Holders, on the ADR registered in the name of the applicable Holders or, in the case of Beneficial Owners, on the ADR representing the ADSs owned by such Beneficial Owners.

(c)           Title. Subject to the limitations contained herein and in the form of Receipt, title to a Receipt (and to the ADSs evidenced thereby), when properly endorsed (in the case of certificated Receipts) or upon delivery to the Depositary of proper instruments of transfer, shall be transferable by delivery with the same effect as in the case of a negotiable instrument under the laws of the State of New York; provided, however, that the Depositary, notwithstanding any notice to the contrary, may treat the Holder thereof as the absolute owner thereof for the purpose of determining the person entitled to distribution of dividends or other distributions or to any notice provided for in this Deposit Agreement and for all other purposes and neither the Depositary nor the Company will have any obligation or be subject to any liability under the Deposit Agreement to any holder of a Receipt, unless such holder is the Holder thereof.

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SECTION 2.3  Deposits.

(a)           Subject to the terms and conditions of this Deposit Agreement and applicable law, Shares or evidence of rights to receive Shares (including Restricted Securities) may be deposited by any person (including the Depositary in its individual capacity but subject, however, in the case of the Company or any Affiliate of the Company, to Section 5.7 hereof) at any time beginning on the 181st day after the date of the prospectus contained in the registration statement on Form F-1 under which the ADSs are first sold, whether or not the transfer books of the Company or the Foreign Registrar, if any, are closed, by Delivery of the Shares to the Custodian.  Except for Shares deposited by the Company in connection with the initial sale of ADSs under the registration statement on Form F-1, no deposit of Shares shall be accepted under this Deposit Agreement prior to such date.  Every deposit of Shares shall be accompanied by the following: (A)(i) in the case of Shares issued in registered form, appropriate instruments of transfer or endorsement, in a form satisfactory to the Custodian, (ii) in the case of Shares issued in bearer form, such Shares or the certificates representing such Shares and (iii) in the case of Shares Delivered by book-entry transfer, confirmation of such book-entry transfer to the Custodian or that irrevocable instructions have been given to cause such Shares to be so transferred, (B) such certifications and payments (including, without limitation, the Depositary’s fees and related charges) and evidence of such payments (including, without limitation, stamping or otherwise marking such Shares by way of receipt) as may be required by the Depositary or the Custodian in accordance with the provisions of this Deposit Agreement, (C) if the Depositary so requires, a written order directing the Depositary to execute and Deliver to, or upon the written order of, the person or persons stated in such order a Receipt or Receipts for the number of American Depositary Shares representing the Shares so deposited, (D) evidence satisfactory to the Depositary (which may include an Opinion of Counsel reasonably satisfactory to the Depositary provided at the cost of the person seeking to deposit Shares) that all conditions to such deposit have been met and all necessary approvals have been granted by, and there has been compliance with the rules and regulations of, any applicable governmental agency and (E) if the Depositary so requires, (i) an agreement, assignment or instrument satisfactory to the Depositary or the Custodian which provides for the prompt transfer by any person in whose name the Shares are or have been recorded to the Custodian of any distribution, or right to subscribe for additional Shares or to receive other property in respect of any such deposited Shares or, in lieu thereof, such indemnity or other agreement as shall be satisfactory to the Depositary or the Custodian and (ii) if the Shares are registered in the name of the person on whose behalf they are presented for deposit, a proxy or proxies entitling the Custodian to exercise voting rights in respect of the Shares for any and all purposes until the Shares so deposited are registered in the name of the Depositary, the Custodian or any nominee.  No Share shall be accepted for deposit unless accompanied by confirmation or such additional evidence, if any is required by the Depositary, that is reasonably satisfactory to the Depositary or the Custodian that all conditions to such deposit have been satisfied by the person depositing such Shares under the laws and regulations of the Cayman Islands and any necessary approval has been granted by any governmental body in the Cayman Islands, if any, which is then performing the function of the regulator of currency exchange.  The Depositary may issue Receipts against evidence of rights to receive Shares from the Company, any agent of the Company or any custodian, registrar, transfer agent, clearing agency or other entity involved in ownership or transaction records in respect of the Shares.  Without limitation of the foregoing, the Depositary shall not knowingly accept for deposit under this Deposit Agreement any Shares or other Deposited Securities required to be registered under the provisions of the Securities Act, unless a registration statement is in effect as to such Shares or other Deposited Securities, or any Shares or other Deposited Securities the deposit of which would violate any provisions of the Memorandum and Articles of Association.  The Depositary shall use commercially reasonable efforts to comply with reasonable written instructions of the Company that the Depositary shall not accept for deposit hereunder any Shares specifically identified in such instructions at such times and under such circumstances as may reasonably be specified in such instructions in order to facilitate the Company’s compliance with the securities laws in the United States and other jurisdictions, provided that the Company shall indemnify the Depositary and the Custodian for any claims and losses arising from not accepting the deposit of any Shares identified in the Company’s instructions.

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(b)           As soon as practicable after receipt of any permitted deposit hereunder and compliance with the provisions of this Deposit Agreement, the Custodian shall present the Shares so deposited, together with the appropriate instrument or instruments of transfer or endorsement, duly stamped, to the Foreign Registrar for transfer and registration of the Shares (as soon as transfer and registration can be accomplished and at the expense of the person for whom the deposit is made) in the name of the Depositary, the Custodian or a nominee of either.  Deposited Securities shall be held by the Depositary or by a Custodian for the account and to the order of the Depositary or a nominee, in each case for the account of the Holders and Beneficial Owners, at such place or places as the Depositary or the Custodian shall determine.

(c)           In the event any Shares are deposited which entitle the holders thereof to receive a per-share distribution or other entitlement in an amount different from the Shares then on deposit, the Depositary is authorized to take any and all actions as may be necessary (including, without limitation, making the necessary notations on Receipts) to give effect to the issuance of such ADSs and to ensure that such ADSs are not fungible with other ADSs issued hereunder until such time as the entitlement of the Shares represented by such non-fungible ADSs equals that of the Shares represented by ADSs prior to such deposit. The Company agrees to give timely written notice to the Depositary if any Shares issued or to be issued contain rights different from those of any other Shares theretofore issued and shall assist the Depositary with the establishment of procedures enabling the identification of such non-fungible Shares upon Delivery to the Custodian.

SECTION 2.4  Execution and Delivery of Receipts.  After the deposit of any Shares pursuant to Section 2.3 hereof, the Custodian shall notify the Depositary of such deposit and the person or persons to whom or upon whose written order a Receipt or Receipts are Deliverable in respect thereof and the number of American Depositary Shares to be evidenced thereby.  Such notification shall be made by letter, first class airmail postage prepaid, or, at the request, risk and expense of the person making the deposit, by cable, telex, SWIFT, facsimile or electronic transmission.  After receiving such notice from the Custodian, the Depositary, subject to this Deposit Agreement (including, without limitation, the payment of the fees, expenses, taxes and/or other charges owing hereunder), shall issue the ADSs representing the Shares so deposited to or upon the order of the person or persons named in the notice delivered to the Depositary and shall execute and Deliver a Receipt registered in the name or names requested by such person or persons evidencing in the aggregate the number of American Depositary Shares to which such person or persons are entitled.  Nothing herein shall prohibit any Pre-Release Transaction upon the terms set forth in this Deposit Agreement.

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SECTION 2.5  Transfer of Receipts; Combination and Split-up of Receipts.

(a)           Transfer.  The Depositary, or, if a Registrar (other than the Depositary) for the Receipts shall have been appointed, the Registrar, subject to the terms and conditions of this Deposit Agreement, shall register transfers of Receipts on its books, upon surrender at the Corporate Trust Office of the Depositary of a Receipt by the Holder thereof in person or by duly authorized attorney, properly endorsed in the case of a certificated Receipt or accompanied by, or in the case of DRS/Profile Receipts receipt by the Depositary of, proper instruments of transfer (including signature guarantees in accordance with standard industry practice) and duly stamped as may be required by the laws of the State of New York and of the United States and any other applicable law.  Subject to the terms and conditions of this Deposit Agreement, including payment of the applicable fees and charges of the Depositary set forth in Section 5.9 hereof and Article (9) of Exhibit A hereto, the Depositary shall execute a new Receipt or Receipts and Deliver the same to or upon the order of the person entitled thereto evidencing the same aggregate number of American Depositary Shares as those evidenced by the Receipts surrendered.

(b)           Combination and Split Up.  The Depositary, subject to the terms and conditions of this Deposit Agreement shall, upon surrender of a Receipt or Receipts for the purpose of effecting a split-up or combination of such Receipt or Receipts and upon payment to the Depositary of the applicable fees and charges set forth in Section 5.9 hereof and Article (9) of Exhibit A hereto, execute and Deliver a new Receipt or Receipts for any authorized number of American Depositary Shares requested, evidencing the same aggregate number of American Depositary Shares as the Receipt or Receipts surrendered.

(c)           Co-Transfer Agents.  The Depositary may appoint one or more co-transfer agents for the purpose of effecting transfers, combinations and split-ups of Receipts at designated transfer offices on behalf of the Depositary. In carrying out its functions, a co-transfer agent may require evidence of authority and compliance with applicable laws and other requirements by Holders or persons entitled to such Receipts and will be entitled to protection and indemnity, in each case to the same extent as the Depositary. Such co-transfer agents may be removed and substitutes appointed by the Depositary.  Each co-transfer agent appointed under this Section 2.5 (other than the Depositary) shall give notice in writing to the Depositary accepting such appointment and agreeing to be bound by the applicable terms of this Deposit Agreement.

(d)           Substitution of Receipts. At the request of a Holder, the Depositary shall, for the purpose of substituting a certificated Receipt with a Receipt issued through DRS/Profile, or vice versa, execute and Deliver a certificated Receipt or DRS/Profile statement, as the case may be, for any authorized number of ADSs requested, evidencing the same aggregate number of ADSs as those evidenced by the certificated Receipt or DRS/Profile statement, as the case may be, substituted.

SECTION 2.6  Surrender of Receipts and Withdrawal of Deposited Securities.  Upon surrender, at the Corporate Trust Office of the Depositary, of American Depositary Shares for the purpose of withdrawal of the Deposited Securities represented thereby, and upon payment of (i) the fees and charges of the Depositary for the making of withdrawals of Deposited Securities and cancellation of Receipts (as set forth in Section 5.9 hereof and Article (9) of Exhibit A hereto) and (ii) all applicable taxes and/or governmental charges payable in connection with such surrender and withdrawal, and subject to the terms and conditions of this Deposit Agreement, the Memorandum and Articles of Association, Section 7.10 hereof and any other provisions of or governing the Deposited Securities and other applicable laws, the Holder of such American Depositary Shares shall be entitled to Delivery, to him or upon his order, of the Deposited Securities at the time represented by the American Depositary Shares so surrendered.  American Depositary Shares may be surrendered for the purpose of withdrawing Deposited Securities by Delivery of a Receipt evidencing such American Depositary Shares (if held in certificated form) or by book-entry Delivery of such American Depositary Shares to the Depositary.

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A Receipt surrendered for such purposes shall, if so required by the Depositary, be properly endorsed in blank or accompanied by proper instruments of transfer in blank, and if the Depositary so requires, the Holder thereof shall execute and deliver to the Depositary a written order directing the Depositary to cause the Deposited Securities being withdrawn to be Delivered to or upon the written order of a person or persons designated in such order. Thereupon, the Depositary shall direct the Custodian to Deliver (without unreasonable delay) at the designated office of the Custodian or through a book-entry delivery of the Shares (in either case, subject to Sections 2.7, 3.1, 3.2, 5.9, hereof and to the other terms and conditions of this Deposit Agreement, to the Memorandum and Articles of Association, to the provisions of or governing the Deposited Securities and to applicable laws, now or hereafter in effect) to or upon the written order of the person or persons designated in the order delivered to the Depositary as provided above, the Deposited Securities represented by such American Depositary Shares, together with any certificate or other proper documents of or relating to title of the Deposited Securities as may be legally required, as the case may be, to or for the account of such person.

The Depositary may, in its discretion, refuse to accept for surrender a number of American Depositary Shares representing a number other than a whole number of Shares.  In the case of surrender of a Receipt evidencing a number of American Depositary Shares representing other than a whole number of Shares, the Depositary shall cause ownership of the appropriate whole number of Shares to be Delivered in accordance with the terms hereof, and shall, at the discretion of the Depositary, either (i) issue and Deliver to the person surrendering such Receipt a new Receipt evidencing American Depositary Shares representing any remaining fractional Share, or (ii) sell or cause to be sold the fractional Shares represented by the Receipt surrendered and remit the proceeds of such sale (net of (a) applicable fees and charges of, and expenses incurred by, the Depositary and (b) taxes and/or governmental charges) to the person surrendering the Receipt.

At the request, risk and expense of any Holder so surrendering a Receipt, and for the account of such Holder, the Depositary shall direct the Custodian to forward (to the extent permitted by law) any cash or other property (other than securities) held in respect of, and any certificate or certificates and other proper documents of or relating to title to, the Deposited Securities represented by such Receipt to the Depositary for delivery at the Corporate Trust Office of the Depositary, and for further Delivery to such Holder.  Such direction shall be given by letter or, at the request, risk and expense of such Holder, by cable, telex or facsimile transmission. Upon receipt by the Depositary, the Depositary may make delivery to such person or persons entitled thereto at the Corporate Trust Office of the Depositary of any dividends or cash distributions with respect to the Deposited Securities represented by such American Depositary Shares, or of any proceeds of sale of any dividends, distributions or rights, which may at the time be held by the Depositary.

SECTION 2.7  Limitations on Execution and Delivery, Transfer, etc. of Receipts; Suspension of Delivery, Transfer, etc.

(a)           Additional Requirements.  As a condition precedent to the execution and Delivery, registration, registration of transfer, split-up, subdivision, combination or surrender of any Receipt, the Delivery of any distribution thereon or withdrawal of any Deposited Securities, the Depositary or the Custodian may require (i) payment from the depositor of Shares or presenter of the Receipt of a sum sufficient to reimburse it for any tax or other governmental charge and any stock transfer or registration fee with respect thereto (including any such tax or charge and fee with respect to Shares being deposited or withdrawn) and payment of any applicable fees and charges of the Depositary as provided in Section 5.9 hereof and Article (9) of Exhibit A hereto, (ii) the production of proof satisfactory to it as to the identity and genuineness of any signature or any other matter contemplated by Section 3.1 hereof and (iii) compliance with (A) any laws or governmental regulations relating to the execution and Delivery of Receipts or American Depositary Shares or to the withdrawal or Delivery of Deposited Securities and (B) such reasonable regulations and procedures as the Depositary may establish consistent with the provisions of this Deposit Agreement and applicable law.

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(b)           Additional Limitations.  The issuance of ADSs against deposits of Shares generally or against deposits of particular Shares may be suspended, or the issuance of ADSs against the deposit of particular Shares may be withheld, or the registration of transfer of Receipts in particular instances may be refused, or the registration of transfers of Receipts generally may be suspended, during any period when the transfer books of the Depositary are closed or if any such action is deemed necessary or advisable by the Depositary or the Company, in good faith, at any time or from time to time because of any requirement of law, any government or governmental body or commission or any securities exchange on which the Receipts or Shares are listed, or under any provision of this Deposit Agreement or provisions of, or governing, the Deposited Securities, or any meeting of shareholders of the Company or for any other reason, subject, in all cases, to Section 7.10 hereof.

SECTION 2.8  Lost Receipts, etc.  To the extent the Depositary has issued Receipts in physical certificated form, in case any Receipt shall be mutilated, destroyed, lost or stolen, unless the Depositary has notice that such ADR has been acquired by a bona fide purchaser, subject to Section 5.9 hereof, the Depositary shall execute and Deliver a new Receipt (which, in the discretion of the Depositary may be issued through DRS/Profile unless specifically requested otherwise) in exchange and substitution for such mutilated Receipt upon cancellation thereof, or in lieu of and in substitution for such destroyed, lost or stolen Receipt.  Before the Depositary shall execute and Deliver a new Receipt in substitution for a destroyed, lost or stolen Receipt, the Holder thereof shall have (a) filed with the Depositary (i) a request for such execution and delivery before the Depositary has notice that the Receipt has been acquired by a bona fide purchaser and (ii) a sufficient indemnity bond in form and amount acceptable to the Depositary and (b) satisfied any other reasonable requirements imposed by the Depositary.

SECTION 2.9  Cancellation and Destruction of Surrendered Receipts; Maintenance of Records.  All Receipts surrendered to the Depositary shall be cancelled by the Depositary. The Depositary is authorized to destroy Receipts so cancelled in accordance with its customary practices.  Cancelled Receipts shall not be entitled to any benefits under this Deposit Agreement or be valid or obligatory for any purpose.

SECTION 2.10  Pre-Release.  Subject to the further terms and provisions of this Section 2.10, the Depositary, its Affiliates and their agents, on their own behalf, may own and deal in any class of securities of the Company and its Affiliates and in ADSs.  In its capacity as Depositary, the Depositary shall not lend Shares or ADSs; provided, however, that the Depositary may, unless otherwise instructed by the Company, (i) issue ADSs prior to the receipt of Shares pursuant to Section 2.3 hereof and (ii) Deliver Shares prior to the receipt and cancellation of ADSs which were issued under (i) above but for which Shares may not yet have been received (each such transaction, a “Pre-Release Transaction”). The Depositary may receive ADSs in lieu of Shares under (i) above and receive Shares in lieu of ADSs under (ii) above.  Each such Pre-Release Transaction will be (a) accompanied by or subject to a written agreement whereby the person or entity (the “Applicant”) to whom ADSs or Shares are to be Delivered (1) represents that at the time of the Pre-Release Transaction the Applicant or its customer owns the Shares or ADSs that are to be Delivered by the Applicant under such Pre-Release Transaction, (2) agrees to indicate the Depositary as owner of such Shares or ADSs in its records and to hold such Shares or ADSs in trust for the Depositary until such Shares or ADSs are Delivered to the Depositary or the Custodian, (3) unconditionally guarantees to deliver to the Depositary or the Custodian, as applicable, such Shares or ADSs and (4) agrees to any additional restrictions or requirements that the Depositary deems appropriate, (b) at all times fully collateralized with cash, United States government securities or such other collateral as the Depositary deems appropriate, (c) terminable by the Depositary on not more than five Business Days’ notice (save for a prescribed termination event in which case any such Pre-Release Transaction may be immediately terminable by the Depositary) and (d) subject to such further indemnities and credit regulations as the Depositary deems appropriate.  The Depositary will normally limit the number of ADSs and Shares involved in such Pre-Release Transactions at any one time to 30% of the ADSs outstanding (without giving effect to ADSs outstanding pursuant to any Pre-Release Transaction under (i) above), provided, however, that the Depositary reserves the right to change or disregard such limit from time to time as it deems appropriate.  The Depositary may also set limits with respect to the number of ADSs and Shares involved in Pre-Release Transactions with any one person on a case by case basis as it deems appropriate.

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The Depositary may retain for its own account any compensation received by it in conjunction with the foregoing. Collateral provided pursuant to (b) above, but not the earnings thereon, shall be held as security for the performance of the Applicant’s obligations in respect of the relevant Pre-Release Transaction and shall not constitute Deposited Securities.

SECTION 2.11 Restricted ADSs.  The Depositary shall, at the request and expense of the Company, establish procedures enabling the deposit hereunder of Shares that are Restricted Securities in order to enable the holder of such Shares to hold its ownership interests in such restricted Shares in the form of ADSs issued under the terms hereof (such Shares, “Restricted Shares”). Upon receipt of a written request from the Company to accept Restricted Shares for deposit hereunder, the Depositary agrees to establish procedures permitting the deposit of such Restricted Shares and the issuance of ADSs representing such deposited Restricted Shares (such ADSs, the “Restricted ADSs,” and the ADRs evidencing such Restricted ADSs, the “Restricted ADRs”). The Company shall assist the Depositary in the establishment of such procedures and agrees that it shall take all steps necessary and reasonably satisfactory to the Depositary to insure that the establishment of such procedures does not violate the provisions of the Securities Act or any other applicable laws. The depositors of such Restricted Shares and the holders of the Restricted ADSs may be required prior to the deposit of such Restricted Shares, the transfer of the Restricted ADRs and the Restricted ADSs evidenced thereby or the withdrawal of the Restricted Shares represented by Restricted ADSs to provide such written certifications or agreements as the Depositary or the Company may require. The Company shall provide to the Depositary in writing the legend(s) to be affixed to the Restricted ADRs, which legends shall (i) be in a form reasonably satisfactory to the Depositary and (ii) contain the specific circumstances under which the Restricted ADRs and the Restricted ADSs represented thereby may be transferred or the Restricted Shares withdrawn. The Restricted ADSs issued upon the deposit of Restricted Shares shall be separately identified on the books of the Depositary and the Restricted Shares so deposited shall be held separate and distinct from the other Deposited Securities held hereunder. The Restricted Shares and the Restricted ADSs shall not be eligible for Pre-Release Transactions. The Restricted ADSs shall not be eligible for inclusion in any book-entry settlement system, including, without limitation, DTC, and shall not in any way be fungible with the ADSs issued under the terms hereof that are not Restricted ADSs. The Restricted ADRs and the Restricted ADSs evidenced thereby shall be transferable only by the Holder thereof upon delivery to the Depositary of (i) all documentation otherwise contemplated by this Deposit Agreement and (ii) an Opinion of Counsel reasonably satisfactory to the Depositary setting forth, inter alia, the conditions upon which the Restricted ADR presented is, and the Restricted ADSs evidenced thereby are, transferable by the Holder thereof under applicable securities laws and the transfer restrictions contained in the legend set forth on the Restricted ADR presented for transfer. Except as set forth in this Section 2.11 and except as required by applicable law, the Restricted ADRs and the Restricted ADSs evidenced thereby shall be treated as ADRs and ADSs issued and outstanding under the terms of the Deposit Agreement. In the event that, in determining the rights and obligations of parties hereto with respect to any Restricted ADSs, any conflict arises between (a) the terms of this Deposit Agreement (other than this Section 2.11) and (b) the terms of (i) this Section 2.11 or (ii) the applicable Restricted ADR, the terms and conditions set forth in this Section 2.11 and of the Restricted ADR shall be controlling and shall govern the rights and obligations of the parties to this Deposit Agreement pertaining to the deposited Restricted Shares, the Restricted ADSs and Restricted ADRs.

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If any of the Restricted ADRs, the Restricted ADSs and the Restricted Shares are no longer Restricted Securities, the Depositary, upon receipt of (x) an Opinion of Counsel reasonably satisfactory to the Depositary setting forth, inter alia, that such Restricted ADRs, Restricted ADSs and Restricted Shares are not as of such time Restricted Securities, and (y) instructions from the Company to remove the restrictions applicable to such Restricted ADRs, Restricted ADSs and the Restricted Shares, shall (i) eliminate the distinctions and separations between such Restricted Shares held on deposit under this Section 2.11 and the other Shares held on deposit under the terms of the Deposit Agreement that are not Restricted Shares, (ii) treat such newly unrestricted ADRs and ADSs on the same terms as, and fully fungible with, the other ADRs and ADSs issued and outstanding under the terms of the Deposit Agreement that are not Restricted ADRs or Restricted ADSs, (iii) take all actions necessary to remove any distinctions, limitations and restrictions previously existing under this Section 2.11 between such Restricted ADRs and Restricted ADSs, respectively, on the one hand, and the other ADRs and ADSs that are not Restricted ADRs or Restricted ADSs, respectively, on the other hand, including, without limitation, by making the newly unrestricted ADSs eligible for Pre-Release Transactions and for inclusion in the applicable book-entry settlement systems.

SECTION 2.12  Maintenance of Records.  The Depositary agrees to maintain records of all Receipts surrendered and Deposited Securities withdrawn under Section 2.6, substitute Receipts Delivered under Section 2.8 and cancelled or destroyed Receipts under Section 2.9, in keeping with the procedures ordinarily followed by stock transfer agents located in the United States.

ARTICLE III.

CERTAIN OBLIGATIONS OF HOLDERS

AND BENEFICIAL OWNERS OF RECEIPTS

SECTION 3.1  Proofs, Certificates and Other Information.  Any depositor presenting Shares for deposit and any Holder and any Beneficial Owner may be required, and every Holder and Beneficial Owner agrees, from time to time to provide to the Depositary or the Custodian such proof of citizenship or residence, taxpayer status, payment of all applicable taxes or other governmental charges, exchange control approval, legal or beneficial ownership of ADSs and Deposited Securities, compliance with applicable laws and the terms of this Deposit Agreement and the provisions of, or governing, the Deposited Securities or other information; to execute such certifications and to make such representations and warranties, and to provide such other information and documentation as the Depositary may deem necessary or proper or as the Company may reasonably require by written request to the Depositary consistent with its obligations hereunder. The Depositary and the Registrar, as applicable, may, and at the request of the Company shall, withhold the execution or Delivery or registration of transfer of any Receipt or the distribution or sale of any dividend or distribution of rights or of the proceeds thereof, or to the extent not limited by the terms of Section 7.10 hereof, the Delivery of any Deposited Securities, until such proof or other information is filed or such certifications are executed, or such representations and warranties are made, or such other documentation or information provided, in each case to the Depositary’s and the Company’s satisfaction. The Depositary shall from time to time on written request advise the Company of the availability of any such proofs, certificates or other information and shall, at the Company’s sole expense, provide or otherwise make available copies thereof to the Company upon written request therefor by the Company, unless such disclosure is prohibited by law.  Each Holder and Beneficial Owner agrees to provide any information requested by the Company or the Depositary pursuant to this Section 3.1.  Nothing herein shall obligate the Depositary to (i) obtain any information for the Company if not provided by the Holders or Beneficial Owners or (ii) verify or vouch for the accuracy of the information so provided by the Holders or Beneficial Owners.

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SECTION 3.2  Liability for Taxes and Other Charges.  If any present or future tax or other governmental charge shall become payable by the Depositary or the Custodian with respect to any ADR or any Deposited Securities or American Depositary Shares, such tax or other governmental charge shall be payable by the Holders and Beneficial Owners to the Depositary and such Holders and Beneficial Owners shall be deemed liable therefor.  The Company, the Custodian and/or the Depositary may withhold or deduct from any distributions made in respect of Deposited Securities and may sell for the account of a Holder and/or Beneficial Owner any or all of the Deposited Securities and apply such distributions and sale proceeds in payment of such taxes (including applicable interest and penalties) and  charges, with the Holder and the Beneficial Owner remaining fully liable for any deficiency.  In addition to any other remedies available to it, the Depositary and the Custodian may refuse the deposit of Shares, and the Depositary may refuse to issue ADSs, to Deliver ADRs, register the transfer, split-up or combination of ADRs and (subject to Section 7.10 hereof) the withdrawal of Deposited Securities, until payment in full of such tax, charge, penalty or interest is received.  Every Holder and Beneficial Owner agrees to indemnify the Depositary, the Company, the Custodian, and each of their respective agents, officers, directors, employees and Affiliates for, and to hold each of them harmless from, any claims with respect to taxes (including applicable interest and penalties thereon) arising from any tax benefit obtained for such Holder and/or Beneficial Owner.  The obligations of Holders and Beneficial Owners of Receipts under this Section 3.2 shall survive any transfer of Receipts, any surrender of Receipts and withdrawal of Deposited Securities, or the termination of this Deposit Agreement.

SECTION 3.3  Representations and Warranties on Deposit of Shares.  Each person presenting Shares for deposit under this Deposit Agreement shall be deemed thereby to represent and warrant that (i) such Shares and the certificates therefor are duly authorized, validly issued, fully paid, non-assessable and were legally obtained by such person, (ii) all preemptive (and similar) rights, if any, with respect to such Shares have been validly waived or exercised, (iii) the person making such deposit is duly authorized so to do, (iv) the Shares presented for deposit are free and clear of any lien, encumbrance, security interest, charge, mortgage or adverse claim and are not, and the American Depositary Shares issuable upon such deposit will not be, Restricted Securities (except as contemplated by Section 2.11), (v) the Shares presented for deposit have not been stripped of any rights or entitlements and (vi) the Shares are not subject to any lock-up agreement with the Company or other party, or the Shares are subject to a lock-up agreement but such lock-up agreement has terminated or the lock-up restrictions imposed thereunder have expired.  Such representations and warranties shall survive the deposit and withdrawal of Shares, the issuance and cancellation of American Depositary Shares in respect thereof and the transfer of such American Depositary Shares.  If any such representations or warranties are false in any way, the Company and the Depositary shall be authorized, at the cost and expense of the person depositing Shares, to take any and all actions necessary to correct the consequences thereof.

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SECTION 3.4  Compliance with Information Requests.  Notwithstanding any other provision of this Deposit Agreement, the Articles of Association and applicable law, each Holder and Beneficial Owner agrees to (a) provide such information as the Company or the Depositary may request pursuant to  law (including, without limitation, relevant Cayman Islands law, any applicable law of the United States, the Memorandum and Articles of Association, any resolutions of the Company’s Board of Directors adopted pursuant to the Memorandum and Articles of Association, the requirements of any markets or exchanges upon which the Shares, ADSs or Receipts are listed or traded, or to any requirements of any electronic book-entry system by which the ADSs or Receipts may be transferred), and (b) be bound by and subject to applicable provisions of the laws of the Cayman Islands, the Memorandum and Articles of Association and the requirements of any markets or exchanges upon which the ADSs, Receipts or Shares are listed or traded, or pursuant to any requirements of any electronic book-entry system by which the ADSs, Receipts or Shares may be transferred, to the same extent as if such Holder and Beneficial Owner held Shares directly, in each case irrespective of whether or not they are Holders or Beneficial Owners at the time such request is made. The Depositary agrees to use its reasonable efforts to forward upon the request of the Company, and at the Company’s expense, any such request from the Company to the Holders and to forward to the Company any such responses to such requests received by the Depositary.

ARTICLE IV.

THE DEPOSITED SECURITIES

SECTION 4.1  Cash Distributions.  Whenever the Depositary receives confirmation from the Custodian of receipt of any cash dividend or other cash distribution on any Deposited Securities, or receives proceeds from the sale of any Shares, rights, securities or other entitlements under the terms hereof, the Depositary will, if at the time of receipt thereof any amounts received in a foreign currency can in the judgment of the Depositary (pursuant to Section 4.6 hereof) be converted on a practicable basis into Dollars transferable to the United States, promptly convert or cause to be converted such cash dividend, distribution or proceeds into Dollars (on the terms described in Section 4.6 hereof) and will distribute promptly the amount thus received (net of (a) the applicable fees and charges of, and expenses incurred by, the Depositary and (b) taxes and/or governmental charges) to the Holders of record as of the ADS Record Date in proportion to the number of American Depositary Shares held by such Holders respectively as of the ADS Record Date.  The Depositary shall distribute only such amount, however, as can be distributed without attributing to any Holder a fraction of one cent.  Any such fractional amounts shall be rounded to the nearest whole cent and so distributed to Holders entitled thereto.  Holders and Beneficial Owners understand that in converting Foreign Currency, amounts received on conversion are calculated at a rate which exceeds three or four decimal places (the number of decimal places used by the Depositary to report distribution rates).  The excess amount may be retained by the Depositary as an additional cost of conversion, irrespective of any other fees and expenses payable or owing hereunder and shall not be subject to escheatment.If the Company, the Custodian or the Depositary is required to withhold and does withhold from any cash dividend or other cash distribution in respect of any Deposited Securities an amount on account of taxes, duties or other governmental charges, the amount distributed to Holders on the ADSs representing such Deposited Securities shall be reduced accordingly. Such withheld amounts shall be forwarded by the Company, the Custodian or the Depositary to the relevant governmental authority.  Evidence of payment thereof by the Company shall be forwarded by the Company to the Depositary upon request.  The Depositary shall forward to the Company or its agent such information from its records as the Company may reasonably request to enable the Company or its agent to file necessary reports with governmental agencies, such reports necessary to obtain benefits under the applicable tax treaties for the Holders and Beneficial Owners of Receipts.

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SECTION 4.2  Distribution in Shares.  If any distribution upon any Deposited Securities consists of a dividend in, or free distribution of, Shares, the Company shall cause such Shares to be deposited with the Custodian and registered, as the case may be, in the name of the Depositary, the Custodian or any of their nominees.  Upon receipt of confirmation of such deposit from the Custodian, the Depositary shall establish the ADS Record Date upon the terms described in Section 4.7 hereof and shall, subject to Section 5.9 hereof, either (i) distribute to the Holders as of the ADS Record Date in proportion to the number of ADSs held as of the ADS Record Date, additional ADSs, which represent in the aggregate the number of Shares received as such dividend, or free distribution, subject to the other terms of this Deposit Agreement (including, without limitation, (a) the applicable fees and charges of, and expenses incurred by, the Depositary and (b) taxes and/or governmental charges), or (ii) if additional ADSs are not so distributed, each ADS issued and outstanding after the ADS Record Date shall, to the extent permissible by law, thenceforth also represent rights and interests in the additional Shares distributed upon the Deposited Securities represented thereby (net of (a) the applicable fees and charges of, and expenses incurred by, the Depositary and (b) taxes and/or governmental charges).  In lieu of Delivering fractional ADSs, the Depositary shall sell the number of Shares represented by the aggregate of such fractions and distribute the proceeds upon the terms described in Section 4.1 hereof. The Depositary may withhold any such distribution of Receipts if it has not received satisfactory assurances from the Company (including an Opinion of Counsel furnished at the expense of the Company) that such distribution does not require registration under the Securities Act or is exempt from registration under the provisions of the Securities Act.  To the extent such distribution may be withheld, the Depositary may dispose of all or a portion of such distribution in such amounts and in such manner, including by public or private sale, as the Depositary deems necessary and practicable, and the Depositary shall distribute the net proceeds of any such sale (after deduction of applicable taxes and/or governmental charges and fees and charges of, and expenses incurred by, the Depositary) to Holders entitled thereto upon the terms described in Section 4.1 hereof.

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SECTION 4.3  Elective Distributions in Cash or Shares.  Whenever the Company intends to distribute a dividend payable at the election of the holders of Shares in cash or in additional Shares, the Company shall give notice thereof to the Depositary at least 30 days prior to the proposed distribution stating whether or not it wishes such elective distribution to be made available to Holders of ADSs.  Upon receipt of notice indicating that the Company wishes such elective distribution to be made available to Holders of ADSs, the Depositary shall consult with the Company to determine, and the Company shall assist the Depositary in its determination, whether it is lawful and reasonably practicable to make such elective distribution available to the Holders of ADSs.  The Depositary shall make such elective distribution available to Holders only if (i) the Company shall have timely requested that the elective distribution is available to Holders of ADRs, (ii) the Depositary shall have determined that such distribution is reasonably practicable and (iii) the Depositary shall have received satisfactory documentation within the terms of Section 5.7 hereof.  If the above conditions are not satisfied, the Depositary shall, to the extent permitted by law, distribute to the Holders, on the basis of the same determination as is made in the local market in respect of the Shares for which no election is made, either cash upon the terms described in Section 4.1 hereof or additional ADSs representing such additional Shares upon the terms described in Section 4.2 hereof.  If the above conditions are satisfied, the Depositary shall establish an ADS Record Date (on the terms described in Section 4.7 hereof) and establish procedures to enable Holders to elect the receipt of the proposed dividend in cash or in additional ADSs.  The Company shall assist the Depositary in establishing such procedures to the extent necessary.  Subject to Section 5.9 hereof, if a Holder elects to receive the proposed dividend in cash, the dividend shall be distributed upon the terms described in Section 4.1 hereof or in ADSs, the dividend shall be distributed upon the terms described in Section 4.2 hereof.  Nothing herein shall obligate the Depositary to make available to Holders a method to receive the elective dividend in Shares (rather than ADSs).  There can be no assurance that Holders generally, or any Holder in particular, will be given the opportunity to receive elective distributions on the same terms and conditions as the holders of Shares.

SECTION 4.4  Distribution of Rights to Purchase Shares.

(a)          Distribution to ADS Holders.  Whenever the Company intends to distribute to the holders of the Deposited Securities rights to subscribe for additional Shares, the Company shall give notice thereof to the Depositary at least 60 days prior to the proposed distribution stating whether or not it wishes such rights to be made available to Holders of ADSs.  Upon receipt of a notice indicating that the Company wishes such rights to be made available to Holders of ADSs, the Depositary shall consult with the Company to determine, and the Company shall determine, whether it is lawful and reasonably practicable to make such rights available to the Holders.  The Depositary shall make such rights available to Holders only if (i) the Company shall have timely requested that such rights be made available to Holders, (ii) the Depositary shall have received satisfactory documentation within the terms of Section 5.7 hereof and (iii) the Depositary shall have determined that such distribution of rights is lawful and reasonably practicable.  In the event any of the conditions set forth above are not satisfied, the Depositary shall proceed with the sale of the rights as contemplated in Section 4.4(b) below or, if timing or market conditions may not permit, do nothing thereby allowing such rights to lapse.  In the event all conditions set forth above are satisfied, the Depositary shall establish an ADS Record Date (upon the terms described in Section 4.7 hereof) and establish procedures to distribute such rights (by means of warrants or otherwise) and to enable the Holders to exercise the rights (upon payment of  applicable fees and charges of, and expenses incurred by, the Depositary and taxes and/or other governmental charges).  Nothing herein shall obligate the Depositary to make available to the Holders a method to exercise such rights to subscribe for Shares (rather than ADSs).

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(b)           Sale of Rights.  If (i) the Company does not timely request the Depositary to make the rights available to Holders or requests that the rights not be made available to Holders, (ii) the Depositary fails to receive satisfactory documentation within the terms of Section 5.7 hereof or determines it is not lawful or reasonably practicable to make the rights available to Holders or (iii) any rights made available are not exercised and appear to be about to lapse, the Depositary shall determine whether it is lawful and reasonably practicable to sell such rights, in a riskless principal capacity or otherwise, at such place and upon such terms (including public or private sale) as it may deem proper.  The Company shall assist the Depositary to the extent necessary to determine such legality and practicability.  The Depositary shall, upon such sale, convert and distribute proceeds of such sale (net of applicable fees and charges of, and expenses incurred by, the Depositary and taxes and/or governmental charges) upon the terms set forth in Section 4.1 hereof.

(c)           Lapse of Rights.  If the Depositary is unable to make any rights available to Holders upon the terms described in Section 4.4(a) hereof or to arrange for the sale of the rights upon the terms described in Section 4.4(b) hereof, the Depositary shall allow such rights to lapse.

The Depositary shall not be responsible for (i) any failure to determine that it may be lawful or practicable to make such rights available to Holders in general or any Holders in particular, (ii) any foreign exchange exposure or loss incurred in connection with such sale or exercise or (iii) the content of any materials forwarded to the Holders on behalf of the Company in connection with the rights distribution.

Notwithstanding anything to the contrary in this Section 4.4, if registration (under the Securities Act or any other applicable law) of the rights or the securities to which any rights relate may be required in order for the Company to offer such rights or such securities to Holders and to sell the securities represented by such rights, the Depositary will not distribute such rights to the Holders (i) unless and until a registration statement under the Securities Act covering such offering is in effect or (ii) unless the Company furnishes at its expense the Depositary with opinion(s) of counsel for the Company in the United States and counsel to the Company in any other applicable country in which rights would be distributed, in each case satisfactory to the Depositary, to the effect that the offering and sale of such securities to Holders and Beneficial Owners are exempt from, or do not require registration under, the provisions of the Securities Act or any other applicable laws.  In the event that the Company, the Depositary or the Custodian shall be required to withhold and does withhold from any distribution of property (including rights) an amount on account of taxes and/or other governmental charges, the amount distributed to the Holders shall be reduced accordingly.  In the event that the Depositary determines that any distribution in property (including Shares and rights to subscribe therefor) is subject to any tax or other governmental charges which the Depositary is obligated to withhold, the Depositary may dispose of all or a portion of such property (including Shares and rights to subscribe therefor) in such amounts and in such manner, including by public or private sale, as the Depositary deems necessary and practicable to pay any such taxes and/or charges.

There can be no assurance that Holders generally, or any Holder in particular, will be given the opportunity to exercise rights on the same terms and conditions as the holders of Shares or be able to exercise such rights.  Nothing herein shall obligate the Company to file any registration statement in respect of any rights or Shares or other securities to be acquired upon the exercise of such rights or otherwise to register or qualify the offer or sale of such rights or securities under the applicable law of any other jurisdiction for any purpose.

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SECTION 4.5  Distributions Other Than Cash, Shares or Rights to Purchase Shares.

(a)          Whenever the Company intends to distribute to the holders of Deposited Securities property other than cash, Shares or rights to purchase additional Shares, the Company shall give notice thereof to the Depositary at least 30 days prior to the proposed distribution and shall indicate whether or not it wishes such distribution to be made to Holders of ADSs.  Upon receipt of a notice indicating that the Company wishes such distribution be made to Holders of ADSs, the Depositary shall determine whether such distribution to Holders is lawful and practicable.  The Depositary shall not make such distribution unless (i) the Company shall have timely requested the Depositary to make such distribution to Holders, (ii) the Depositary shall have received satisfactory documentation within the terms of Section 5.7 hereof and (iii) the Depositary shall have determined that such distribution is reasonably practicable.

(b)          Upon receipt of satisfactory documentation and the request of the Company to distribute property to Holders of ADSs and after making the requisite determinations set forth in (a) above, the Depositary may distribute the property so received to the Holders of record as of the ADS Record Date, in proportion to the number of ADSs held by such Holders respectively and in such manner as the Depositary may deem practicable for accomplishing such distribution (i) upon receipt of payment or net of the applicable fees and charges of, and expenses incurred by, the Depositary and (ii) net of any taxes and/or other governmental charges.  The Depositary may dispose of all or a portion of the property so distributed and deposited, in such amounts and in such manner (including public or private sale) as the Depositary may deem practicable or necessary to satisfy any taxes (including applicable interest and penalties) and other governmental charges applicable to the distribution.

(c)          If (i) the Company does not request the Depositary to make such distribution to Holders or requests not to make such distribution to Holders, (ii) the Depositary does not receive satisfactory documentation within the terms of Section 5.7 hereof or (iii) the Depositary determines that all or a portion of such distribution is not reasonably practicable or feasible, the Depositary shall endeavor to sell or cause such property to be sold in a public or private sale, at such place or places and upon such terms as it may deem proper and shall distribute the net proceeds, if any, of such sale received by the Depositary (net of applicable fees and charges of, and expenses incurred by, the Depositary and taxes and/or governmental charges) to the Holders as of the ADS Record Date upon the terms of Section 4.1 hereof.  If the Depositary is unable to sell such property, the Depositary may dispose of such property in any way it deems reasonably practicable under the circumstances for nominal or no consideration and Holders and Beneficial Owners shall have no rights thereto or arising therefrom.

SECTION 4.6  Conversion of Foreign Currency.  Whenever the Depositary or the Custodian shall receive Foreign Currency, by way of dividends or other distributions or the net proceeds from the sale of securities, property or rights, and in the judgment of the Depositary such Foreign Currency can at such time be converted on a practicable basis (by sale or in any other manner that it may determine in accordance with applicable law) into Dollars transferable to the United States and distributable to the Holders entitled thereto, the Depositary shall convert or cause to be converted, by sale or in any other manner that it may determine, such Foreign Currency into Dollars, and shall distribute such Dollars (net of any fees, expenses, taxes and/or other governmental charges incurred in the process of such conversion) in accordance with the terms of the applicable sections of this Deposit Agreement.  If the Depositary shall have distributed warrants or other instruments that entitle the holders thereof to such Dollars, the Depositary shall distribute such Dollars to the holders of such warrants and/or instruments upon surrender thereof for cancellation, in either case without liability for interest thereon. Such distribution may be made upon an averaged or other practicable basis without regard to any distinctions among Holders on account of exchange restrictions, the date of delivery of any Receipt or otherwise.

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In converting Foreign Currency, amounts received on conversion may be calculated at a rate which exceeds the number of decimal places used by the Depositary to report distribution rates (which in any case will not be less than two decimal places).  Any excess amount may be retained by the Depositary as an additional cost of conversion, irrespective of any other fees and expenses payable or owing hereunder and shall not be subject to escheatment.

If such conversion or distribution can be effected only with the approval or license of any government or agency thereof, the Depositary may file such application for approval or license, if any, as it may deem necessary, practicable and at nominal cost and expense.  Nothing herein shall obligate the Depositary to file or cause to be filed, or to seek effectiveness of any such application or license.

If at any time the Depositary shall determine that in its judgment the conversion of any Foreign Currency and the transfer and distribution of proceeds of such conversion received by the Depositary is not practical or lawful, or if any approval or license of any governmental authority or agency thereof that is required for such conversion, transfer and distribution is denied, or not obtainable at a reasonable cost, within a reasonable period or otherwise sought, the Depositary shall, in its sole discretion but subject to applicable laws and regulations, either (i) distribute the Foreign Currency (or an appropriate document evidencing the right to receive such Foreign Currency) received by the Depositary to the Holders entitled to receive such Foreign Currency or (ii) hold such Foreign Currency uninvested and without liability for interest thereon for the respective accounts of the Holders entitled to receive the same.

SECTION 4.7  Fixing of Record Date.  Whenever necessary in connection with any distribution (whether in cash, Shares, rights, or other distribution), or whenever for any reason the Depositary causes a change in the number of Shares that are represented by each American Depositary Share, or whenever the Depositary shall receive notice of any meeting of or solicitation of holders of Shares or other Deposited Securities, or whenever the Depositary shall find it necessary or convenient, the Depositary shall fix a record date (the “ADS Record Date”), as close as practicable to the record date fixed by the Company with respect to the Shares, for the determination of the Holders who shall be entitled to receive such distribution, to give instructions to the Depositary for the exercise of voting rights at any such meeting, to give or withhold such consent, to receive such notice or solicitation or to otherwise take action or to exercise the rights of Holders with respect to such changed number of Shares represented by each American Depositary Share.  Subject to applicable law and the provisions of Sections 4.1 through 4.6 hereof and to the other terms and conditions of this Deposit Agreement, only the Holders of record at the close of business in New York on such ADS Record Date shall be entitled to receive such distribution, to give such voting instructions, to receive such notice or solicitation, or otherwise take action.

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SECTION 4.8  Voting of Deposited Securities.  Subject to the next sentence, as soon as practicable after receipt of notice of any meeting at which the holders of Shares or other Deposited Securities are entitled to vote, or of solicitation of consents or proxies from holders of Shares or other Deposited Securities, the Depositary shall fix the ADS Record Date in respect of such meeting or solicitation of consent or proxy. The Depositary shall, if requested by the Company in writing in a timely manner (the Depositary having no obligation to take any further action if the request shall not have been received by the Depositary at least 30 Business Days prior to the date of such vote or meeting) and at the Company’s expense, and provided no U.S. legal prohibitions exist, mail by regular, ordinary mail delivery, or by electronic transmission, or otherwise distribute as soon as practicable after receipt thereof to Holders as of the ADS Record Date: (a) such notice of meeting or solicitation of consent or proxy; (b) a statement that the Holders at the close of business on the ADS Record Date will be entitled, subject to any applicable law, the Memorandum and Articles of Association and the provisions of or governing the Deposited Securities (which provisions, if any, shall be summarized in pertinent part by the Company), to instruct the Depositary as to the exercise of the voting rights, if any, pertaining to the Shares or other Deposited Securities represented by such Holder’s American Depositary Shares; and (c) a brief statement as to the manner in which such instructions may be given to the Depositary or in which voting instructions may be deemed to have been given in accordance with this Section 4.8, including an express indication that instructions may be given (or be deemed to have been given in accordance with the immediately following paragraph of this section if no instruction is received) to the Depositary to give a discretionary proxy to a person or persons designated by the Company.  Voting instructions may be given only in respect of a number of American Depositary Shares representing an integral number of Shares or other Deposited Securities.  Upon the timely receipt from a Holder of American Depositary Shares on the ADS Record Date of written voting instructions in the manner specified by the Depositary, the Depositary shall endeavor, insofar as practicable and permitted under applicable law, the provisions of this Deposit Agreement, the Memorandum and Articles of Association and the provisions of or governing the Deposited Securities, to vote or cause the Custodian to vote the Shares and/or other Deposited Securities (in person or by proxy) represented by American Depositary Shares evidenced by such Receipt in accordance with such voting instructions.

In the event that (i) the Depositary timely receives voting instructions from a Holder which fail to specify the manner in which the Depositary is to vote the Deposited Securities represented by such Holder’s ADSs or (ii) no timely instructions are received by the Depositary from a Holder with respect to any of the Deposited Securities represented by the ADSs held by such Holder on the ADS Record Date, the Depositary shall (unless otherwise specified in the notice distributed to Holders) deem such Holder to have instructed the Depositary to give a discretionary proxy to a person designated by the Company with respect to such Deposited Securities and the Depositary shall give a discretionary proxy to a person designated by the Company to vote such Deposited Securities, provided, however, that no such instruction shall be deemed to have been given and no such discretionary proxy shall be given with respect to any matter as to which the Company informs the Depositary (and the Company agrees to provide such information as promptly as practicable in writing, if applicable) that (x) the Company does not wish to give such proxy, (y) the Company is aware or should reasonably be aware that substantial opposition exists from Holders against the outcome for which the person designated by the Company would otherwise vote or (z) the outcome for which the person designated by the Company would otherwise vote would materially and adversely affect the rights of holders of Shares, provided, further, that the Company will have no liability to any Holder or Beneficial Owner resulting from such notification.

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In the event that voting on any resolution or matter is conducted on a show of hands basis in accordance with the Memorandum and Articles of Association, the Depositary will refrain from voting and the voting instructions (or the deemed voting instructions, as set out above) received by the Depositary from Holders shall lapse.  The Depositary will have no obligation to demand voting on a poll basis with respect to any resolution and shall have no liability to any Holder or Beneficial Owner for not having demanded voting on a poll basis.

Neither the Depositary nor the Custodian shall, under any circumstances exercise any discretion as to voting, and neither the Depositary nor the Custodian shall vote, attempt to exercise the right to vote, or in any way make use of for purposes of establishing a quorum or otherwise, the Shares or other Deposited Securities represented by ADSs except pursuant to and in accordance with such written instructions from Holders, including the deemed instruction to the Depositary to give a discretionary proxy to a person designated by the Company.  Shares or other Deposited Securities represented by ADSs for which (i) no timely voting instructions are received by the Depositary from the Holder, or (ii) timely voting instructions are received by the Depositary from the Holder but such voting instructions fail to specify the manner in which the Depositary is to vote the Deposited Securities represented by such Holder’s ADSs, shall be voted in the manner provided in this Section 4.8.  Notwithstanding anything else contained herein, and subject to applicable law, regulation and the Memorandum and Articles of Association, the Depositary shall, if so requested in writing by the Company, represent all Deposited Securities (whether or not voting instructions have been received in respect of such Deposited Securities from Holders as of the ADS Record Date) for the purpose of establishing quorum at a meeting of shareholders.

There can be no assurance that Holders or Beneficial Owners generally or any Holder or Beneficial Owner in particular will receive the notice described above with sufficient time to enable the Holder to return voting instructions to the Depositary in a timely manner.

Notwithstanding the above, save for applicable provisions of the law of the Cayman Islands, and in accordance with the terms of Section 5.3 hereof, the Depositary shall not be liable for any failure to carry out any instructions to vote any of the Deposited Securities or the manner in which such vote is cast or the effect of such vote.

SECTION 4.9  Changes Affecting Deposited Securities.  Upon any change in par value, split-up, subdivision, cancellation, consolidation or any other reclassification of Deposited Securities or upon any recapitalization, reorganization, amalgamation, merger or consolidation or sale of assets affecting the Company or to which it is otherwise a party, any securities which shall be received by the Depositary or the Custodian in exchange for, or in conversion of or replacement or otherwise in respect of, such Deposited Securities shall, to the extent permitted by law, be treated as new Deposited Securities under this Deposit Agreement and the Receipts shall, subject to the provisions of this Deposit Agreement and applicable law, evidence American Depositary Shares representing the right to receive such additional securities.  Alternatively, the Depositary may, with the Company’s approval, and shall, if the Company shall so request, subject to the terms of this Deposit Agreement and receipt of an Opinion of Counsel furnished at the Company’s expense satisfactory to the Depositary (stating that such distributions are not in violation of any applicable laws or regulations), execute and deliver additional Receipts, as in the case of a stock dividend on the Shares, or call for the surrender of outstanding Receipts to be exchanged for new Receipts. In either case, as well as in the event of newly deposited Shares, necessary modifications to the form of Receipt contained in Exhibit A and Exhibit B hereto, specifically describing such new Deposited Securities and/or corporate change, shall also be made. The Company agrees that it will, jointly with the Depositary, amend the Registration Statement on Form F-6 as filed with the Commission to permit the issuance of such new form of Receipt. Notwithstanding the foregoing, in the event that any security so received may not be lawfully distributed to some or all Holders, the Depositary may, with the Company’s approval, and shall, if the Company requests, subject to receipt of an opinion of the Company’s counsel furnished at the Company’s expense satisfactory to the Depositary that such action is not in violation of any applicable laws or regulations, sell such securities at public or private sale, at such place or places and upon such terms as it may deem proper and may allocate the net proceeds of such sales (net of fees and charges of, and expenses incurred by, the Depositary and taxes and/or governmental charges) for the account of the Holders otherwise entitled to such securities upon an averaged or other practicable basis without regard to any distinctions among such Holders and distribute the net proceeds so allocated to the extent practicable as in the case of a distribution received in cash pursuant to Section 4.1 hereof. The Depositary shall not be responsible for (i) any failure to determine that it may be lawful or feasible to make such securities available to Holders in general or to any Holder in particular, (ii) any foreign exchange exposure or loss incurred in connection with such sale or (iii) any liability to the purchaser of such securities.

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SECTION 4.10  Available Information.  The Company is subject to the periodic reporting requirements of the Exchange Act applicable to foreign private issuers (as defined in Rule 405 of the Securities Act) and accordingly files certain information with the Commission.  These reports and documents can be inspected and copied at the public reference facilities maintained by the Commission located at 100 F Street, N.E., Washington D.C. 20549, U.S.A.

SECTION 4.11  Reports.  The Depositary shall make available during normal business hour on any Business Day for inspection by Holders at its Corporate Trust Office any reports and communications, including any proxy soliciting materials, received from the Company which are both received by the Depositary, the Custodian, or the nominee of either of them as the holder of the Deposited Securities and made generally available to the holders of such Deposited Securities by the Company.  The Company agrees to provide to the Depositary, at the Company’s expense, all documents that it provides to the Custodian.  The Depositary shall, at the expense of the Company (unless otherwise agreed in writing by the Company and the Depositary), and in accordance with Section 5.6 hereof, also mail by regular, ordinary mail delivery or by electronic transmission (if agreed by the Company and the Depositary) and unless otherwise agreed in writing by the Company and the Depositary, to Holders copies of such reports when furnished by the Company pursuant to Section 5.6 hereof.

SECTION 4.12  List of Holders.  Promptly upon written request by the Company, the Depositary shall furnish to it a list, as of a recent date, of the names, addresses and holdings of American Depositary Shares by all persons in whose names Receipts are registered on the books of the Depositary.

SECTION 4.13  Taxation; Withholding.  The Depositary will, and will instruct the Custodian to, forward to the Company or its agents such information from its records as the Company may reasonably request to enable the Company or its agents to file necessary tax reports with governmental authorities or agencies. The Depositary, the Custodian or the Company and its agents may, but shall not be obligated to, file such reports as are necessary to reduce or eliminate applicable taxes on dividends and on other distributions in respect of Deposited Securities under applicable tax treaties or laws for the Holders and Beneficial Owners. Holders and Beneficial Owners of American Depositary Shares may be required from time to time, and in a timely manner, to file such proof of taxpayer status, residence and beneficial ownership (as applicable), to execute such certificates and to make such representations and warranties, or to provide any other information or documents, as the Depositary or the Custodian may deem necessary or proper to fulfill the Depositary’s or the Custodian’s obligations under applicable law. The Holders and Beneficial Owners shall indemnify the Depositary, the Company, the Custodian and any of their respective directors, employees, agents and Affiliates against, and hold each of them harmless from, any claims by any governmental authority with respect to taxes, additions to tax, penalties or interest arising out of any refund of taxes, reduced rate of withholding at source or other tax benefit obtained by the Beneficial Owner or Holder.

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The Company shall remit to the appropriate governmental authority or agency any amounts required to be withheld by the Company and owing to such governmental authority or agency.  Upon any such withholding, the Company shall remit to the Depositary information, in a form reasonably satisfactory to the Depositary, about such taxes and/or governmental charges withheld or paid, and, if so requested, the tax receipt (or other proof of payment to the applicable governmental authority) therefor.  The Depositary shall, to the extent required by U.S. law, report to Holders (i) any taxes withheld by it; (ii) any taxes withheld by the Custodian, subject to information being provided to the Depositary by the Custodian and (iii) any taxes withheld by the Company, subject to information being provided to the Depositary by the Company. The Depositary and the Custodian shall not be required to provide the Holders with any evidence of the remittance by the Company (or its agents) of any taxes withheld, or of the payment of taxes by the Company, except to the extent the evidence is provided by the Company to the Depositary.  Neither the Depositary, the Custodian, nor the Company shall be liable for the failure by any Holder or Beneficial Owner to obtain the benefits of credits on the basis of non-U.S. tax paid against such Holder’s or Beneficial Owner’s income tax liability.

In the event that the Depositary determines that any distribution in property (including Shares and rights to subscribe therefor) is subject to any tax or other governmental charge which the Depositary is obligated to withhold, the Depositary shall withhold the amount required to be withheld and may by public or private sale dispose of all or a portion of such property (including Shares and rights to subscribe therefor) in such amounts and in such manner as the Depositary deems necessary and practicable to pay such taxes and/or charges and the Depositary shall distribute the net proceeds of any such sale after deduction of such taxes and/or charges to the Holders entitled thereto in proportion to the number of American Depositary Shares held by them respectively.

The Depositary is under no obligation to provide the Holders and Beneficial Owners with any information about the tax status of the Company.  The Depositary shall not incur any liability for any tax consequences that may be incurred by Holders and Beneficial Owners on account of their ownership of the American Depositary Shares.

ARTICLE V.

THE DEPOSITARY, THE CUSTODIAN AND THE COMPANY

SECTION 5.1  Maintenance of Office and Transfer Books by the Registrar.  Until termination of this Deposit Agreement in accordance with its terms, the Depositary or if a Registrar for the Receipts shall have been appointed, the Registrar shall maintain in the Borough of Manhattan, the City of New York, an office and facilities for the execution and delivery, registration, registration of transfers, combination and split-up of Receipts, the surrender of Receipts and the delivery and withdrawal of Deposited Securities in accordance with the provisions of this Deposit Agreement.

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The Depositary or the Registrar as applicable, shall keep books for the registration of Receipts and transfers of Receipts which at all reasonable times shall be open for inspection by the Company and by the Holders of such Receipts, provided that such inspection shall not be, to the Depositary’s or the Registrar’s knowledge, for the purpose of communicating with Holders of such Receipts in the interest of a business or object other than the business of the Company or other than a matter related to this Deposit Agreement or the Receipts.

The Depositary or the Registrar, as applicable, may close the transfer books with respect to the Receipts, at any time or from time to time, when deemed necessary or advisable by it in connection with the performance of its duties hereunder, or at the reasonable written request of the Company.

If any Receipts or the American Depositary Shares evidenced thereby are listed on one or more stock exchanges or automated quotation systems in the United States, the Depositary shall act as Registrar or appoint a Registrar or one or more co-registrars for registration of Receipts and transfers, combinations and split-ups, and to countersign such Receipts in accordance with any requirements of such exchanges or systems. Such Registrar or co-registrars may be removed and a substitute or substitutes appointed by the Depositary.

If any Receipts or the American Depositary Shares evidenced thereby are listed on one or more securities exchanges, markets or automated quotation systems, (i) the Depositary shall be entitled to, and shall, take or refrain from taking such action(s) as it may deem necessary or appropriate to comply with the requirements of such securities exchange(s), market(s) or automated quotation system(s) applicable to it, notwithstanding any other provision of this Deposit Agreement; and (ii) upon the reasonable request of the Depositary, the Company shall provide the Depositary such information and assistance as may be reasonably necessary for the Depositary to comply with such requirements, to the extent that the Company may lawfully do so.

Each Registrar and co-registrar appointed under this Section 5.1 shall give notice in writing to the Depositary accepting such appointment and agreeing to be bound by the applicable terms of the Deposit Agreement.

SECTION 5.2  Exoneration.  Neither the Depositary, the Custodian or the Company shall be obligated to do or perform any act which is inconsistent with the provisions of this Deposit Agreement or shall incur any liability (i) if the Depositary, the Custodian or the Company or their respective controlling persons or agents shall be prevented or forbidden from, or delayed in, doing or performing any act or thing required by the terms of this Deposit Agreement, by reason of any provision of any present or future law or regulation of the United States or any state thereof, the Cayman Islands or any other country, or of any other governmental authority or regulatory authority or stock exchange, or on account of the possible criminal or civil penalties or restraint, or by reason of any provision, present or future, of the Memorandum and Articles of Association or any provision of or governing any Deposited Securities, or by reason of any act of God or war or other circumstances beyond its control (including, without limitation, nationalization, expropriation, currency restrictions, work stoppage, strikes, civil unrest, revolutions, rebellions, explosions and computer failure), (ii) by reason of any exercise of, or failure to exercise, any discretion provided for in this Deposit Agreement or in the Memorandum and Articles of Association or provisions of or governing Deposited Securities, (iii) for any action or inaction of the Depositary, the Custodian or the Company or their respective controlling persons or agents in reliance upon the advice of or information from legal counsel, accountants, any person presenting Shares for deposit, any Holder, any Beneficial Owner or authorized representative thereof, or any other person believed by it in good faith to be competent to give such advice or information, (iv) for the inability by a Holder or Beneficial Owner to benefit from any distribution, offering, right or other benefit which is made available to holders of Deposited Securities but is not, under the terms of this Deposit Agreement, made available to Holders of American Depositary Shares or (v) for any special, consequential, indirect or punitive damages for any breach of the terms of this Deposit Agreement or otherwise.

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The Depositary, its controlling persons, its agents, the Custodian and the Company, its controlling persons and its agents may rely and shall be protected in acting upon any written notice, request, opinion or other document believed by it to be genuine and to have been signed or presented by the proper party or parties.

No disclaimer of liability under the Securities Act is intended by any provision of this Deposit Agreement.

SECTION 5.3  Standard of Care.  The Company and the Depositary and their respective directors, officers, affiliates, employees and agents assume no obligation and shall not be subject to any liability under this Deposit Agreement or any Receipts to any Holder(s) or Beneficial Owner(s) or other persons, except in accordance with Section 5.8 hereof, provided, that the Company and the Depositary and their respective directors, officers, affiliates, employees and agents agree to perform their respective obligations specifically set forth in this Deposit Agreement or the applicable ADRs without gross negligence or willful misconduct.

Without limitation of the foregoing, neither the Depositary, nor the Company, nor any of their respective controlling persons, directors, officers, affiliates, employees or agents, shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of any Deposited Securities or in respect of the Receipts, which in its opinion may involve it in expense or liability, unless indemnity satisfactory to it against all expenses (including fees and disbursements of counsel) and liabilities be furnished as often as may be required (and no Custodian shall be under any obligation whatsoever with respect to such proceedings, the responsibility of the Custodian being solely to the Depositary).

The Depositary and its directors, officers, affiliates, employees and agents shall not be liable for any failure to carry out any instructions to vote any of the Deposited Securities, or for the manner in which any vote is cast or the effects of any vote.  The Depositary shall not incur any liability for any failure to determine that any distribution or action may be lawful or reasonably practicable, for the content of any information submitted to it by the Company for distribution to the Holders or for any inaccuracy of any translation thereof, for any investment risk associated with acquiring an interest in the Deposited Securities, for the validity or worth of the Deposited Securities or for any tax consequences that may result from the ownership of ADSs, Shares or Deposited Securities, for the credit-worthiness of any third party, for allowing any rights to lapse upon the terms of this Deposit Agreement or for the failure or timeliness of any notice from the Company, or for any action or non action by it in reliance upon the opinion, advice of or information from legal counsel, accountants, any person representing Shares for deposit, any Holder or any other person believed by it in good faith to be competent to give such advice or information.  The Depositary and its agents shall not be liable for any acts or omissions made by a successor depositary whether in connection with a previous act or omission of the Depositary or in connection with any matter arising wholly after the removal or resignation of the Depositary, provided that in connection with the issue out of which such potential liability arises the Depositary performed its obligations without gross negligence or willful misconduct while it acted as Depositary.

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SECTION 5.4  Resignation and Removal of the Depositary; Appointment of Successor Depositary.  The Depositary may at any time resign as Depositary hereunder by written notice of resignation delivered to the Company, such resignation to be effective on the earlier of (i) the 90th day after delivery thereof to the Company (whereupon the Depositary shall, in the event no successor depositary has been appointed by the Company, be entitled to take the actions contemplated in Section 6.2 hereof) and (ii) upon the appointment by the Company of a successor depositary and its acceptance of such appointment as hereinafter provided, save that, any amounts, fees, costs or expenses owed to the Depositary hereunder or in accordance with any other agreements otherwise agreed in writing between the Company and the Depositary from time to time shall be paid to the Depositary prior to such resignation.

The Company shall use reasonable efforts to appoint such successor depositary, and give notice to the Depositary of such appointment, not more than 90 days after delivery by the Depositary of written notice of resignation as provided in this Section 5.4.  In the event that notice of the appointment of a successor depositary is not provided by the Company in accordance with the preceding sentence, the Depositary shall be entitled to take the actions contemplated in Section 6.2 hereof.

The Depositary may at any time be removed by the Company by written notice of such removal, which removal shall be effective on the earlier of (i) the 90th day after delivery thereof to the Depositary (whereupon the Depositary shall be entitled to take the actions contemplated in Section 6.2 hereof), and (ii) upon the appointment by the Company of a successor depositary and its acceptance of such appointment as hereinafter provided, save that, any amounts, fees, costs or expenses owed to the Depositary hereunder or in accordance with any other agreements otherwise agreed in writing between the Company and the Depositary from time to time shall be paid to the Depositary prior to such removal.

In case at any time the Depositary acting hereunder shall resign or be removed, the Company shall use its best efforts to appoint a successor depositary, which shall be a bank or trust company having an office in the Borough of Manhattan, the City of New York.  Every successor depositary shall be required by the Company to execute and deliver to its predecessor and to the Company an instrument in writing accepting its appointment hereunder, and thereupon such successor depositary, without any further act or deed (except as required by applicable law), shall become fully vested with all the rights, powers, duties and obligations of its predecessor.  The predecessor depositary, upon payment of all sums due to it and on the written request of the Company, shall (i) execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder (other than as contemplated in Sections 5.8 and 5.9 hereof), (ii) duly assign, transfer and deliver all right, title and interest to the Deposited Securities to such successor, and (iii) deliver to such successor a list of the Holders of all outstanding Receipts and such other information relating to Receipts and Holders thereof as the successor may reasonably request.  Any such successor depositary shall promptly mail notice of its appointment to such Holders.

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Any corporation into or with which the Depositary may be merged or consolidated shall be the successor of the Depositary without the execution or filing of any document or any further act.

SECTION 5.5  The Custodian.  The Custodian or its successors in acting hereunder shall be subject at all times and in all respects to the direction of the Depositary for the Deposited Securities for which the Custodian acts as custodian and shall be responsible solely to it.  If any Custodian resigns or is discharged from its duties hereunder with respect to any Deposited Securities and no other Custodian has previously been appointed hereunder, the Depositary shall promptly appoint a substitute custodian.  The Depositary shall require such resigning or discharged Custodian to deliver the Deposited Securities held by it, together with all such records maintained by it as Custodian with respect to such Deposited Securities as the Depositary may request, to the Custodian designated by the Depositary.  Whenever the Depositary determines, in its discretion, that it is appropriate to do so, it may appoint an additional entity to act as Custodian with respect to any Deposited Securities, or discharge the Custodian with respect to any Deposited Securities and appoint a substitute custodian, which shall thereafter be Custodian hereunder with respect to the Deposited Securities.  After any such change, the Depositary shall give notice thereof in writing to all Holders.

Upon the appointment of any successor depositary, any Custodian then acting hereunder shall, unless otherwise instructed by the Depositary, continue to be the Custodian of the Deposited Securities without any further act or writing and shall be subject to the direction of the successor depositary. The successor depositary so appointed shall, nevertheless, on the written request of any Custodian, execute and deliver to such Custodian all such instruments as may be proper to give to such Custodian full and complete power and authority to act on the direction of such successor depositary.

SECTION 5.6  Notices and Reports.  On or before the first date on which the Company gives notice, by publication or otherwise, of any meeting of holders of Shares or other Deposited Securities, or of any adjourned meeting of such holders, or of the taking of any action by such holders other than at a meeting, or of the taking of any action in respect of any cash or other distributions or the offering of any rights in respect of Deposited Securities, the Company shall transmit to the Depositary and the Custodian a copy of the notice thereof in English but otherwise in the form given or to be given to holders of Shares or other Deposited Securities. The Company shall also furnish to the Custodian and the Depositary a summary, in English, of any applicable provisions or proposed provisions of the Memorandum and Articles of Association that may be relevant or pertain to such notice of meeting or be the subject of a vote thereat.

The Company will also transmit to the Depositary (a) English language versions of the other notices, reports and communications which are made generally available by the Company to holders of its Shares or other Deposited Securities and (b) English language versions of the Company’s annual and other reports prepared in accordance with the applicable requirements of the Commission.  The Depositary shall arrange, at the request of the Company and at the Company’s expense, for the mailing of copies thereof to all Holders, or by any other means as agreed between the Company and the Depositary (at the Company’s expense) or make such notices, reports and other communications available for inspection by all Holders, provided, that, the Depositary shall have received evidence sufficiently satisfactory to it, including in the form of an opinion of local and/or U.S. counsel or counsel of other applicable jurisdiction, furnished at the expense of the Company, as the Depositary reasonably requests, that the distribution of such notices, reports and any such other communications to Holders from time to time is valid and does not or will not infringe any local, U.S. or other applicable jurisdiction regulatory restrictions or requirements if so distributed and made available to Holders.  The Company will timely provide the Depositary with the quantity of such notices, reports, and communications, as requested by the Depositary from time to time, in order for the Depositary to effect such mailings. The Company has delivered to the Depositary and the Custodian a copy of the Memorandum and Articles of Association along with the provisions of or governing the Shares and any other Deposited Securities issued by the Company or any Affiliate of the Company, in connection with the Shares, in each case along with a certified English translation thereof, and promptly upon any amendment thereto or change therein, the Company shall deliver to the Depositary and the Custodian a copy of such amendment thereto or change therein (along with a certified English translation thereof). The Depositary may rely upon such copy for all purposes of this Deposit Agreement.

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The Depositary will make available a copy of any such notices, reports or communications issued by the Company and delivered to the Depositary for inspection by the Holders of the Receipts evidencing the American Depositary Shares representing such Shares governed by such provisions at the Depositary’s Corporate Trust Office, at the office of the Custodian and at any other designated transfer office.

SECTION 5.7  Issuance of Additional Shares, ADSs etc.  The Company agrees that in the event it or any of its Affiliates proposes (i) an issuance, sale or distribution of additional Shares, (ii) an offering of rights to subscribe for Shares or other Deposited Securities, (iii) an issuance of securities convertible into or exchangeable for Shares, (iv) an issuance of rights to subscribe for securities convertible into or exchangeable for Shares, (v) an elective dividend of cash or Shares, (vi) a redemption of Deposited Securities, (vii) a meeting of holders of Deposited Securities, or solicitation of consents or proxies, relating to any reclassification of securities, merger, subdivision, amalgamation or consolidation or transfer of assets or (viii) any reclassification, recapitalization, reorganization, merger, amalgamation, consolidation or sale of assets which affects the Deposited Securities, it will obtain U.S. legal advice and take all steps necessary to ensure that the application of the proposed transaction to Holders and Beneficial Owners does not violate the registration provisions of the Securities Act, or any other applicable laws (including, without limitation, the Investment Company Act of 1940, as amended, the Exchange Act or the securities laws of the states of the United States).  In support of the foregoing, the Company will furnish to the Depositary, at the Company’s expense, (a) a written opinion of U.S. counsel (satisfactory to the Depositary) stating whether or not application of such transaction to Holders and Beneficial Owners (1) requires a registration statement under the Securities Act to be in effect or (2) is exempt from the registration requirements of the Securities Act and/or (3) dealing with such other issues reasonably requested by the Depositary; (b) a written opinion of Cayman Islands counsel (satisfactory to the Depositary) stating that (1) making the transaction available to Holders and Beneficial Owners does not violate the laws or regulations of the Cayman Islands and (2) all requisite regulatory consents and approvals have been obtained in the Cayman Islands; and (c) as the Depositary may reasonably request, a written opinion of counsel in any other jurisdiction in which Holders or Beneficial Owners reside to the effect that making the transaction available to such Holders or Beneficial Owners does not violate the laws or regulations of such jurisdiction.  If the filing of a registration statement is required, the Depositary shall not have any obligation to proceed with the transaction unless it shall have received evidence reasonably satisfactory to it that such registration statement has been declared effective and that such distribution is in accordance with all applicable laws or regulations.  If, being advised by counsel, the Company determines that a transaction is required to be registered under the Securities Act, the Company will either (i) register such transaction to the extent necessary, (ii) alter the terms of the transaction to avoid the registration requirements of the Securities Act or (iii) direct the Depositary to take specific measures, in each case as contemplated in this Deposit Agreement, to prevent such transaction from violating the registration requirements of the Securities Act.

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The Company agrees with the Depositary that neither the Company nor any of its Affiliates will at any time (i) deposit any Shares or other Deposited Securities, either upon original issuance or upon a sale of Shares or other Deposited Securities previously issued and reacquired by the Company or by any such Affiliate, or (ii) issue additional Shares, rights to subscribe for such Shares, securities convertible into or exchangeable for Shares or rights to subscribe for such securities, unless such transaction and the securities issuable in such transaction are exempt from registration under the Securities Act or have been registered under the Securities Act (and such registration statement has been declared effective).

Notwithstanding anything else contained in this Deposit Agreement, nothing in this Deposit Agreement shall be deemed to obligate the Company to file any registration statement in respect of any proposed transaction.

SECTION 5.8  Indemnification.  The Company agrees to indemnify the Depositary, any Custodian and each of their respective directors, officers, employees, agents and Affiliates against, and hold each of them harmless from, any direct losses, liabilities, taxes, costs, claims, judgments, proceedings, actions, demands and any charges or expenses of any kind whatsoever (including, but not limited to, reasonable attorney’s fees and expenses and, in each case, fees and expenses of counsel, in each case, irrevocable value added tax and any similar tax charged or otherwise imposed in respect thereof) (collectively referred to as “Losses”) which the Depositary or any agent thereof may incur or which may be made against it as a result of or in connection with its appointment or the exercise of its powers and duties under this Agreement or that may arise (a) out of or in connection with any offer, issuance, sale, resale, transfer, deposit or withdrawal of Receipts, American Depositary Shares, the Shares, or other Deposited Securities, as the case may be, (b) out of or in connection with any offering documents in respect thereof or (c) out of or in connection with acts performed or omitted, including, but not limited to, any delivery by the Depositary on behalf of the Company of information regarding the Company in connection with this Deposit Agreement, the Receipts, the American Depositary Shares, the Shares, or any Deposited Securities, in any such case (i) by the Depositary, the Custodian or any of their respective directors, officers, employees, agents and Affiliates, except to the extent any such Losses arises out of the gross negligence or bad faith of any of them, or (ii) by the Company or any of its directors, officers, employees, agents and Affiliates.  Notwithstanding the above, in no event shall the Company or any of its directors, officers, employees, agents and/or Affiliates be liable for any indirect, special, punitive or consequential damages to the Depositary, any Custodian and each of their respective directors, officers, employees, agents and Affiliates or any other person.

The Depositary agrees to indemnify the Company and any of its respective directors, officers, employees, agents and Affiliates against and hold each of them harmless from any direct Losses which may arise out of acts performed or omitted to be performed by the Depositary arising out of the gross negligence or bad faith of the Depositary or any of their respective directors, officers or employees, agents and/or Affiliates.  Notwithstanding the above, in no event shall the Depositary or any of its directors, officers, employees, agents and/or Affiliates be liable for any indirect, special punitive or consequential damages to the Company, Holders, Beneficial Owners or any other person.

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Any person seeking indemnification hereunder (an “Indemnified Person”) shall notify the person from whom it is seeking indemnification (the “Indemnifying Person”) of the commencement of any indemnifiable action or claim promptly after such Indemnified Person becomes aware of such commencement (provided that the failure to make such notification shall not affect such Indemnified Person’s rights to indemnification except to the extent the Indemnifying Person is materially prejudiced by such failure) and shall consult in good faith with the Indemnifying Person as to the conduct of the defense of such action or claim that may give rise to an indemnity hereunder, which defense shall be reasonable under the circumstances. No Indemnified Person shall compromise or settle any action or claim that may give rise to an indemnity hereunder without the consent of the Indemnifying Person, which consent shall not be unreasonably withheld.

The obligations set forth in this Section shall survive the termination of this Deposit Agreement and the succession or substitution of any party hereto.

SECTION 5.9  Fees and Charges of Depositary.  The Company, the Holders, the Beneficial Owners, and persons depositing Shares or surrendering ADSs for cancellation and withdrawal of Deposited Securities shall be required to pay to the Depositary the Depositary’s fees and related charges identified as payable by them respectively as provided for under Article (9) of Exhibit A hereto.  All fees and charges so payable may, at any time and from time to time, be changed by agreement between the Depositary and the Company, but, in the case of fees and charges payable by Holders and Beneficial Owners, only in the manner contemplated in Section 6.1 hereof.  The Depositary shall provide, without charge, a copy of its latest fee schedule to anyone upon request.

The Depositary and the Company may reach separate agreement in relation to the payment of any additional remuneration to the Depositary in respect of any exceptional duties which the Depositary finds necessary or desirable and agreed by both parties in the performance of its obligations hereunder and in respect of the actual costs and expenses of the Depositary in respect of any notices required to be given to the Holders in accordance with Article (20) of Exhibit B hereto.

In connection with any payment by the Company to the Depositary:

(i) all fees, taxes, duties, charges, costs and expenses which are payable by the Company shall be paid or be procured to be paid by the Company (and any such amounts which are paid by the Depositary shall be reimbursed to the Depositary by the Company upon demand therefor);

(ii) such payment shall be subject to all necessary applicable exchange control and other consents and approvals having been obtained. The Company undertakes to use its reasonable endeavours to obtain all necessary approvals that are required to be obtained by it in this connection; and

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(iii) the Depositary may request, in its sole but reasonable discretion after reasonable consultation with the Company, an Opinion of Counsel regarding U.S. law, the laws ofthe Cayman Islands or of any other relevant jurisdiction, to be furnished at the expense of the Company, if at any time it deems it necessary to seek such an Opinion of Counsel regarding the validity of any action to be taken or instructed to be taken under this Agreement.

The Company agrees to promptly pay to the Depositary such other fees, charges and expenses and to reimburse the Depositary for such out-of-pocket expenses as the Depositary and the Company may agree to in writing from time to time.  Responsibility for payment of such charges may at any time and from time to time be changed by agreement between the Company and the Depositary.

All payments by the Company to the Depositary under this Clause 5.9 shall be paid without set-off or counterclaim, and free and clear of and without deduction or withholding for or on account of, any present or future taxes, levies, imports, duties, fees, assessments or other charges of whatever nature, imposed by the Cayman Islands or by any department, agency or other political subdivision or taxing authority thereof or therein, and all interest, penalties or similar liabilities with respect thereto.

The right of the Depositary to receive payment of fees, charges and expenses as provided above shall survive the termination of this Deposit Agreement.  As to any Depositary, upon the resignation or removal of such Depositary as described in Section 5.4 hereof, such right shall extend for those fees, charges and expenses incurred prior to the effectiveness of such resignation or removal.

SECTION 5.10  Restricted Securities Owners/Ownership Restrictions.  From time to time or upon request of the Depositary, the Company shall provide to the Depositary a list setting forth, to the actual knowledge of the Company, those persons or entities who beneficially own Restricted Securities and the Company shall update such list on a regular basis. The Depositary may rely on such list or update but shall not be liable for any action or omission made in reliance thereon. The Company agrees to advise in writing each of the persons or entities who, to the knowledge of the Company, holds Restricted Securities that such Restricted Securities are ineligible for deposit hereunder (except under the circumstances contemplated in Section 2.11) and, to the extent practicable, shall require each of such persons to represent in writing that such person will not deposit Restricted Securities hereunder (except under the circumstances contemplated in Section 2.11).  The Company shall, in accordance with Article (24) of Exhibit B hereto, inform Holders and Beneficial Owners and the Depositary of any other limitations on ownership of Shares that the Holders and Beneficial Owners may be subject to by reason of the number of ADSs held under the Articles of Association or applicable Cayman Islands law, as such restrictions may be in force from time to time.

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ARTICLE VI.

AMENDMENT AND TERMINATION

SECTION 6.1  Amendment/Supplement.  Subject to the terms and conditions of this Section 6.1 and applicable law, the Receipts outstanding at any time, the provisions of this Deposit Agreement and the form of Receipt attached hereto and to be issued under the terms hereof may at any time and from time to time be amended or supplemented by written agreement between the Company and the Depositary in any respect which they may deem necessary or desirable and not materially prejudicial to the Holders without the consent of the Holders or Beneficial Owners. Any amendment or supplement which shall impose or increase any fees or charges (other than charges in connection with foreign exchange control regulations, and taxes and/or other governmental charges, delivery and other such expenses payable by Holders or Beneficial Owners), or which shall otherwise materially prejudice any substantial existing right of Holders or Beneficial Owners, shall not, however, become effective as to outstanding Receipts until 30 days after notice of such amendment or supplement shall have been given to the Holders of outstanding Receipts. Notice of any amendment to the Deposit Agreement or form of Receipts shall not need to describe in detail the specific amendments effectuated thereby, and failure to describe the specific amendments in any such notice shall not render such notice invalid, provided, however, that, in each such case, the notice given to the Holders identifies a means for Holders and Beneficial Owners to retrieve or receive the text of such amendment (i.e., upon retrieval from the Commission's, the Depositary's or the Company's website or upon request from the Depositary).The parties hereto agree that any amendments or supplements which (i) are reasonably necessary (as agreed by the Company and the Depositary) in order for (a) the American Depositary Shares to be registered on Form F-6 under the Securities Act or (b) the American Depositary Shares or the Shares to be traded solely in electronic book-entry form and (ii) do not in either such case impose or increase any fees or charges to be borne by Holders, shall be deemed not to materially prejudice any substantial rights of Holders or Beneficial Owners. Every Holder and Beneficial Owner at the time any amendment or supplement so becomes effective shall be deemed, by continuing to hold such American Depositary Share or Shares, to consent and agree to such amendment or supplement and to be bound by the Deposit Agreement as amended and supplemented thereby. In no event shall any amendment or supplement impair the right of the Holder to surrender such Receipt and receive therefor the Deposited Securities represented thereby, except in order to comply with mandatory provisions of applicable law. Notwithstanding the foregoing, if any governmental body should adopt new laws, rules or regulations which would require amendment or supplement of the Deposit Agreement to ensure compliance therewith, the Company and the Depositary may amend or supplement the Deposit Agreement and the Receipt at any time in accordance with such changed laws, rules or regulations.  Such amendment or supplement to the Deposit Agreement in such circumstances may become effective before a notice of such amendment or supplement is given to Holders or within any other period of time as required for compliance with such laws, rules or regulations.

SECTION 6.2  Termination.  The Depositary shall, at any time at the written direction of the Company, terminate this Deposit Agreement by mailing notice of such termination to the Holders of all Receipts then outstanding at least 60 days prior to the date fixed in such notice for such termination, provided that, the Depositary shall be reimbursed for any amounts, fees, costs or expenses owed to it in accordance with the terms of this Deposit Agreement and in accordance with any other agreements as otherwise agreed in writing between the Company and the Depositary from time to time, prior to such termination shall take effect. If 90 days shall have expired after (i) the Depositary shall have delivered to the Company a written notice of its election to resign, or (ii) the Company shall have delivered to the Depositary a written notice of the removal of the Depositary, and in either case a successor depositary shall not have been appointed and accepted its appointment as provided in Section 5.4 hereof, the Depositary may terminate this Deposit Agreement by mailing notice of such termination to the Holders of all Receipts then outstanding at least 30 days prior to the date fixed for such termination. On and after the date of termination of this Deposit Agreement, the Holder will, upon surrender of such Receipt at the Corporate Trust Office of the Depositary, upon the payment of the charges of the Depositary for the surrender of Receipts referred to in Section 2.6 hereof and subject to the conditions and restrictions therein set forth, and upon payment of any applicable taxes and/or governmental charges, be entitled to Delivery, to him or upon his order, of the amount of Deposited Securities represented by such Receipt. If any Receipts shall remain outstanding after the date of termination of this Deposit Agreement, the Registrar thereafter shall discontinue the registration of transfers of Receipts, and the Depositary shall suspend the distribution of dividends to the Holders thereof, and shall not give any further notices or perform any further acts under this Deposit Agreement, except that the Depositary shall continue to collect dividends and other distributions pertaining to Deposited Securities, shall sell rights or other property as provided in this Deposit Agreement, and shall continue to Deliver Deposited Securities, subject to the conditions and restrictions set forth in Section 2.6 hereof, together with any dividends or other distributions received with respect thereto and the net proceeds of the sale of any rights or other property, in exchange for Receipts surrendered to the Depositary (after deducting, or charging, as the case may be, in each case, the charges of the Depositary for the surrender of a Receipt, any expenses for the account of the Holder in accordance with the terms and conditions of this Deposit Agreement and any applicable taxes and/or governmental charges or assessments). At any time after the expiration of six months from the date of termination of this Deposit Agreement, the Depositary may sell the Deposited Securities then held hereunder and may thereafter hold uninvested the net proceeds of any such sale, together with any other cash then held by it hereunder, in an unsegregated account, without liability for interest for the pro rata benefit of the Holders of Receipts whose Receipts have not theretofore been surrendered. After making such sale, the Depositary shall be discharged from all obligations under this Deposit Agreement with respect to the Receipts and the Shares, Deposited Securities and American Depositary Shares, except to account for such net proceeds and other cash (after deducting, or charging, as the case may be, in each case, the charges of the Depositary for the surrender of a Receipt, any expenses for the account of the Holder in accordance with the terms and conditions of this Deposit Agreement and any applicable taxes and/or governmental charges or assessments). Upon the termination of this Deposit Agreement, the Company shall be discharged from all obligations under this Deposit Agreement except for its obligations to the Depositary hereunder.

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ARTICLE VII.

MISCELLANEOUS

SECTION 7.1  Counterparts.  This Deposit Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of such counterparts together shall constitute one and the same agreement. Copies of this Deposit Agreement shall be maintained with the Depositary and shall be open to inspection by any Holder during business hours.

SECTION 7.2  No Third-Party Beneficiaries.  This Deposit Agreement is for the exclusive benefit of the parties hereto (and their successors) and shall not be deemed to give any legal or equitable right, remedy or claim whatsoever to any other person, except to the extent specifically set forth in this Deposit Agreement.  Nothing in this Deposit Agreement shall be deemed to give rise to a partnership or joint venture among the parties hereto nor establish a fiduciary or similar relationship among the parties.  The parties hereto acknowledge and agree that (i) the Depositary and its Affiliates may at any time have multiple banking relationships with the Company and its Affiliates, (ii) the Depositary and its Affiliates may be engaged at any time in transactions in which parties adverse to the Company or the Holders or Beneficial Owners may have interests and (iii) nothing contained in this Agreement shall (a) preclude the Depositary or any of its Affiliates from engaging in such transactions or establishing or maintaining such relationships, or (b) obligate the Depositary or any of its Affiliates to disclose such transactions or relationships or to account for any profit made or payment received in such transactions or relationships.

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SECTION 7.3  Severability.  In case any one or more of the provisions contained in this Deposit Agreement or in the Receipts should be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein or therein shall in no way be affected, prejudiced or disturbed thereby.

SECTION 7.4  Holders and Beneficial Owners as Parties; Binding Effect.  The Holders and Beneficial Owners from time to time of American Depositary Shares shall be parties to the Deposit Agreement and shall be bound by all of the terms and conditions hereof and of any Receipt by acceptance hereof or any beneficial interest therein.

SECTION 7.5  Notices.  Any and all notices to be given to the Company shall be deemed to have been duly given if personally delivered or sent by first-class mail, air courier or cable, telex, facsimile transmission or electronic transmission, confirmed by letter, addressed to Grand Farm Inc. [No.2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, China 351111] , or to any other address which the Company may specify in writing to the Depositary.

Any and all notices to be given to the Depositary shall be deemed to have been duly given if personally delivered or sent by first-class mail, air courier or cable, telex, facsimile transmission or by electronic transmission (if agreed by the Company and the Depositary), at the Company’s expense, unless otherwise agreed in writing between the Company and the Depositary, confirmed by letter, addressed to Deutsche Bank Trust Company Americas, 60 Wall Street, New York, New York 10005, USA, Attention:  ADR Department, telephone:  +1 212 250-9100, facsimile:  + 1 212 797 0327 or to any other address which the Depositary may specify in writing to the Company.

Any and all notices to be given to any Holder shall be deemed to have been duly given if personally delivered or sent by first-class mail or cable, telex, facsimile transmission or by electronic transmission (if agreed by the Company and the Depositary), at the Company’s expense, unless otherwise agreed in writing between the Company and the Depositary, addressed to such Holder at the address of such Holder as it appears on the transfer books for Receipts of the Depositary, or, if such Holder shall have filed with the Depositary a written request that notices intended for such Holder be mailed to some other address, at the address specified in such request. Notice to Holders shall be deemed to be notice to Beneficial Owners for all purposes of this Deposit Agreement.

Delivery of a notice sent by mail, air courier or cable, telex, facsimile or electronic transmission shall be deemed to be effective at the time when a duly addressed letter containing the same (or a confirmation thereof in the case of a cable, telex, facsimile or electronic transmission) is deposited, postage prepaid, in a post-office letter box or delivered to an air courier service. The Depositary or the Company may, however, act upon any cable, telex, facsimile or electronic transmission received by it from the other or from any Holder, notwithstanding that such cable, telex, facsimile or electronic transmission shall not subsequently be confirmed by letter as aforesaid, as the case may be.

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SECTION 7.6  Governing Law and Jurisdiction.  This Deposit Agreement and the Receipts shall be interpreted in accordance with, and all rights hereunder and thereunder and provisions hereof and thereof shall be governed by, the laws of the State of New York without reference to the principles of choice of law thereof.  Except as set forth in the following paragraph of this Section 7.6, the Company and the Depositary agree that the federal or state courts in the City of New York shall have non-exclusive jurisdiction to hear and determine any suit, action or proceeding and to settle any dispute between them that may arise out of or in connection with this Deposit Agreement and, for such purposes, each irrevocably submits to the non-exclusive jurisdiction of such courts. The Company hereby irrevocably designates, appoints and empowers [●] (the “Process Agent”), now at [●] as its authorized agent to receive and accept for and on its behalf, and on behalf of its properties, assets and revenues, service by mail of any and all legal process, summons, notices and documents that may be served in any suit, action or proceeding brought against the Company in any federal or state court as described in the preceding sentence or in the next paragraph of this Section 7.6. If for any reason the Process Agent shall cease to be available to act as such, the Company agrees to designate a new agent in The City of New York on the terms and for the purposes of this Section 7.6 reasonably satisfactory to the Depositary. The Company further hereby irrevocably consents and agrees to the service of any and all legal process, summons, notices and documents in any suit, action or proceeding against the Company, by service by mail of a copy thereof upon the Process Agent (whether or not the appointment of such Process Agent shall for any reason prove to be ineffective or such Process Agent shall fail to accept or acknowledge such service), with a copy mailed to the Company by registered or certified air mail, postage prepaid, to its address provided in Section 7.5 hereof. The Company agrees that the failure of the Process Agent to give any notice of such service to it shall not impair or affect in any way the validity of such service or any judgment rendered in any action or proceeding based thereon.

Notwithstanding the foregoing, the Depositary and the Company unconditionally agree that in the event that a Holder or Beneficial Owner brings a suit, action or proceeding against (a) the Company, (b) the Depositary in its capacity as Depositary under this Deposit Agreement or (c) against both the Company and the Depositary, in any state or federal court of the United States, and the Depositary or the Company have any claim, for indemnification or otherwise, against each other arising out of the subject matter of such suit, action or proceeding, then the Company and the Depositary may pursue such claim against each other in the state or federal court in the United States in which such suit, action, or proceeding is pending, and for such purposes, the Company and the Depositary irrevocably submit to the non-exclusive jurisdiction of such courts. The Company agrees that service of process upon the Process Agent in the manner set forth in the preceding paragraph shall be effective service upon it for any suit, action or proceeding brought against it as described in this paragraph.

The Company irrevocably and unconditionally waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of venue of any actions, suits or proceedings brought in any court as provided in this Section 7.6, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.

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The Company and the Depositary agree that, notwithstanding the foregoing, with regard to any claim or dispute or difference of whatever nature between the parties hereto arising directly or indirectly from the relationship created by this Deposit Agreement, the Depositary, in its sole discretion, shall be entitled to refer such dispute or difference for final settlement by arbitration (“Arbitration”) in accordance with the applicable rules of the American Arbitration Association (the “Rules”) then in force, by a sole arbitrator appointed in accordance with the Rules.  The seat and place of any reference to Arbitration shall be New York, New York State.  The procedural law of any Arbitration shall be New York law and the language to be used in the Arbitration shall be English. The fees of the arbitrator and other costs incurred by the parties in connection with such Arbitration shall be paid by the party that is unsuccessful in such Arbitration.

EACH PARTY TO THE DEPOSIT AGREEMENT (INCLUDING, FOR AVOIDANCE OF DOUBT, EACH HOLDER AND BENEFICIAL OWNER AND/OR HOLDER OF INTERESTS IN THE ADRs) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING AGAINST THE DEPOSITARY AND/OR THE COMPANY DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THE SHARES OR OTHER DEPOSITED SECURITIES, THE ADSs OR THE ADRs, THE DEPOSIT AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREIN OR THEREIN, OR THE BREACH HEREOF OR THEREOF (WHETHER BASED ON CONTRACT, TORT, COMMON LAW OR ANY OTHER THEORY).

The provisions of this Section 7.6 shall survive any termination of this Deposit Agreement, in whole or in part.

SECTION 7.7  Assignment.  Subject to the provisions of Section 5.4 hereof, this Deposit Agreement may not be assigned by either the Company or the Depositary.

SECTION 7.8  Agents.  The Depositary shall be entitled, in its sole but reasonable discretion, to appoint one or more agents (the “Agents”) of which it shall have control for the purpose, inter alia, of making distributions to the Holders or otherwise carrying out its obligations under this Agreement.

SECTION 7.9  Exclusivity.  The Company agrees not to appoint any other depositary for the issuance or administration of depositary receipts evidencing any class of stock of the Company so long as Deutsche Bank Trust Company Americas is acting as Depositary hereunder.

SECTION 7.10  Compliance with U.S. Securities Laws.  Notwithstanding anything in this Deposit Agreement to the contrary, the withdrawal or Delivery of Deposited Securities will not be suspended by the Company or the Depositary except as would be permitted by Instruction I.A.(1) of the General Instructions to Form F-6 Registration Statement, as amended from time to time, under the Securities Act.

SECTION 7.11  Titles.  All references in this Deposit Agreement to exhibits, Articles, sections, subsections, and other subdivisions refer to the exhibits, Articles, sections, subsections and other subdivisions of this Deposit Agreement unless expressly provided otherwise.  The words “this Deposit Agreement”, “herein”, “hereof”, “hereby”, “hereunder”, and words of similar import refer to the Deposit Agreement as a whole as in effect between the Company, the Depositary and the Holders and Beneficial Owners of ADSs and not to any particular subdivision unless expressly so limited.  Pronouns in masculine, feminine and neuter gender shall be construed to include any other gender, and words in the singular form shall be construed to include the plural and vice versa unless the context otherwise requires.  Titles to sections of this Deposit Agreement are included for convenience only and shall be disregarded in construing the language contained in this Deposit Agreement.

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IN WITNESS WHEREOF, GRAND FARM INC., and DEUTSCHE BANK TRUST COMPANY AMERICAS have duly executed this Deposit Agreement as of the day and year first above set forth and all Holders and Beneficial Owners shall become parties hereto upon acceptance by them of American Depositary Shares evidenced by Receipts issued in accordance with the terms hereof.

GRAND FARM INC.
By:
	Name:
	Title:
DEUTSCHE BANK TRUST COMPANY AMERICAS
By:
	Name:
	Title:
By:
	Name:
	Title:

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EXHIBIT A

CUSIP [●]

ISIN [●]

American Depositary

Shares (Each

American Depositary

Share

representing [●]

Fully Paid Ordinary

Shares)

[FORM OF FACE OF RECEIPT]

AMERICAN DEPOSITARY RECEIPT

for

AMERICAN DEPOSITARY SHARES

representing

DEPOSITED ORDINARY SHARES

of

GRAND FARM INC.

(Incorporated under the laws of the Cayman Islands)

DEUTSCHE BANK TRUST COMPANY AMERICAS, as depositary (herein called the “Depositary”), hereby certifies that ________________ is the owner of ______________ American Depositary Shares (hereinafter “ADS”), representing deposited ordinary shares, each of Par Value of $[●] including evidence of rights to receive such ordinary shares (the “Shares”) of Grand Farm Inc., a company incorporated under the laws of the Cayman Islands (the “Company”). As of the date of the Deposit Agreement (hereinafter referred to), each ADS represents [●] Shares deposited under the Deposit Agreement with the Custodian which at the date of execution of the Deposit Agreement is [Deutsche Bank AG, Hong Kong Branch] (the “Custodian”). The ratio of Depositary Shares to shares of stock is subject to subsequent amendment as provided in Article IV of the Deposit Agreement.  The Depositary’s Corporate Trust Office is located at 60 Wall Street, New York, New York 10005, U.S.A.

(1)           The Deposit Agreement.  This American Depositary Receipt is one of an issue of American Depositary Receipts (“Receipts”), all issued or to be issued upon the terms and conditions set forth in the Deposit Agreement, dated as of [●], 2011 (as amended from time to time, the “Deposit Agreement”), by and among the Company, the Depositary, and all Holders and Beneficial Owners from time to time of Receipts issued thereunder, each of whom by accepting a Receipt agrees to become a party thereto and becomes bound by all the terms and conditions thereof. The Deposit Agreement sets forth the rights and obligations of Holders and Beneficial Owners of Receipts and the rights and duties of the Depositary in respect of the Shares deposited thereunder and any and all other securities, property and cash from time to time, received in respect of such Shares and held thereunder (such Shares, other securities, property and cash are herein called “Deposited Securities”). Copies of the Deposit Agreement are on file at the Corporate Trust Office of the Depositary and the Custodian.

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Each owner and each Beneficial Owner, upon acceptance of any ADSs (or any interest therein) issued in accordance with the terms and conditions of the Deposit Agreement, shall be deemed for all purposes to (a) be a party to and bound by the terms of the Deposit Agreement and applicable ADR(s), and (b) appoint the Depositary its attorney-in-fact, with full power to delegate, to act on its behalf and to take any and all actions contemplated in the Deposit Agreement and the applicable ADR(s), to adopt any and all procedures necessary to comply with applicable law and to take such action as the Depositary in its sole discretion may deem necessary or appropriate to carry out the purposes of the Deposit Agreement and the applicable ADR(s), the taking of such actions to be the conclusive determinant of the necessity and appropriateness thereof.

The statements made on the face and reverse of this Receipt are summaries of certain provisions of the Deposit Agreement and the Memorandum and Articles of Association (as in effect on the date of the Deposit Agreement) and are qualified by and subject to the detailed provisions of the Deposit Agreement, to which reference is hereby made. All capitalized terms used herein which are not otherwise defined herein shall have the meanings ascribed thereto in the Deposit Agreement. The Depositary makes no representation or warranty as to the validity or worth of the Deposited Securities.  The Depositary has made arrangements for the acceptance of the American Depositary Shares into DTC.  Each Beneficial Owner of American Depositary Shares held through DTC must rely on the procedures of DTC and the DTC Participants to exercise and be entitled to any rights attributable to such American Depositary Shares.  The Receipt evidencing the American Depositary Shares held through DTC will be registered in the name of a nominee of DTC.  So long as the American Depositary Shares are held through DTC or unless otherwise required by law, ownership of beneficial interests in the Receipt registered in the name of DTC (or its nominee) will be shown on, and transfers of such ownership will be effected only through, records maintained by (i) DTC (or its nominee), or (ii) DTC Participants (or their nominees).

(2)           Surrender of Receipts and Withdrawal of Deposited Securities.  Upon surrender, at the Corporate Trust Office of the Depositary, of ADSs evidenced by this Receipt for the purpose of withdrawal of the Deposited Securities represented thereby, and upon payment of (i) the charges of the Depositary for the making of withdrawals and cancellation of Receipts (as set forth in Section 5.9 of the Deposit Agreement and Article (9) hereof) and (ii) all fees, taxes and/or governmental charges payable in connection with such surrender and withdrawal, and, subject to the terms and conditions of the Deposit Agreement, the Memorandum and Articles of Association, Section 7.10 of the Deposit Agreement, Article (22) hereof and the provisions of or governing the Deposited Securities and other applicable laws, the Holder of the American Depositary Shares evidenced hereby is entitled to Delivery, to him or upon his order, of the Deposited Securities represented by the ADS so surrendered.  Subject to the last sentence of this paragraph, such Deposited Securities may be Delivered in certificated form or by electronic Delivery. ADS may be surrendered for the purpose of withdrawing Deposited Securities by Delivery of a Receipt evidencing such ADS (if held in registered form) or by book-entry delivery of such ADS to the Depositary.

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A Receipt surrendered for such purposes shall, if so required by the Depositary, be properly endorsed in blank or accompanied by proper instruments of transfer in blank, and if the Depositary so requires, the Holder thereof shall execute and deliver to the Depositary a written order directing the Depositary to cause the Deposited Securities being withdrawn to be Delivered to or upon the written order of a person or persons designated in such order. Thereupon, the Depositary shall direct the Custodian to Deliver (without unreasonable delay) at the designated office of the Custodian (subject to the terms and conditions of the Deposit Agreement, to the Memorandum and Articles of Association, and to the provisions of or governing the Deposited Securities and applicable laws, now or hereafter in effect), to or upon the written order of the person or persons designated in the order delivered to the Depositary as provided above, the Deposited Securities represented by such ADSs, together with any certificate or other proper documents of or relating to title for the Deposited Securities or evidence of the electronic transfer thereof (if available) as the case may be to or for the account of such person.  The Depositary may make delivery to such person or persons at the Corporate Trust Office of the Depositary of any dividends or distributions with respect to the Deposited Securities represented by such Receipt, or of any proceeds of sale of any dividends, distributions or rights, which may at the time be held by the Depositary.

The Depositary may, in its discretion, refuse to accept for surrender a number of American Depositary Shares representing a number of Shares other than a whole number of Shares.  In the case of surrender of a Receipt evidencing a number of ADSs representing other than a whole number of Shares, the Depositary shall cause ownership of the appropriate whole number of Shares to be Delivered in accordance with the terms hereof, and shall, at the discretion of the Depositary, either (i) issue and Deliver to the person surrendering such Receipt a new Receipt evidencing American Depositary Shares representing any remaining fractional Share, or (ii) sell or cause to be sold the fractional Shares represented by the Receipt so surrendered and remit the proceeds thereof (net of (a) applicable fees and charges of, and expenses incurred by, the Depositary and (b) taxes and/or governmental charges) to the person surrendering the Receipt.  At the request, risk and expense of any Holder so surrendering a Receipt, and for the account of such Holder, the Depositary shall direct the Custodian to forward (to the extent permitted by law) any cash or other property (other than securities) held in respect of, and any certificate or certificates and other proper documents of or relating to title to, the Deposited Securities represented by such Receipt to the Depositary for Delivery at the Corporate Trust Office of the Depositary, and for further Delivery to such Holder.  Such direction shall be given by letter or, at the request, risk and expense of such Holder, by cable, telex or facsimile transmission.

(3)           Transfers, Split-Ups and Combinations of Receipts.  Subject to the terms and conditions of the Deposit Agreement, the Registrar shall register transfers of Receipts on its books, upon surrender at the Corporate Trust Office of the Depositary of a Receipt by the Holder thereof in person or by duly authorized attorney, properly endorsed or accompanied by proper instruments of transfer (including signature guarantees in accordance with standard industry practice) and duly stamped as may be required by the laws of the State of New York and of the United States of America, of the Cayman Islands and of any other applicable jurisdiction.  Subject to the terms and conditions of the Deposit Agreement, including payment of the applicable fees and expenses incurred by, and charges of, the Depositary, the Depositary shall execute and Deliver a new Receipt(s) (and if necessary, cause the Registrar to countersign such Receipt(s)) and deliver same to or upon the order of the person entitled to such Receipts evidencing the same aggregate number of ADSs as those evidenced by the Receipts surrendered. Upon surrender of a Receipt or Receipts for the purpose of effecting a split-up or combination of such Receipt or Receipts upon payment of the applicable fees and charges of the Depositary, and subject to the terms and conditions of the Deposit Agreement, the Depositary shall execute and deliver a new Receipt or Receipts for any authorized number of ADSs requested, evidencing the same aggregate number of ADSs as the Receipt or Receipts surrendered.

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(4)           Pre-Conditions to Registration, Transfer, Etc.  As a condition precedent to the execution and delivery, registration of transfer, split-up, combination or surrender of any Receipt or withdrawal of any Deposited Securities, the Depositary or the Custodian may require (i) payment from the depositor of Shares or presenter of the Receipt of a sum sufficient to reimburse it for any tax or other governmental charge and any stock transfer or registration fee with respect thereto (including any such tax or charge and fee with respect to Shares being deposited or withdrawn) and payment of any applicable fees and charges of the Depositary as provided in the Deposit Agreement and in this Receipt, (ii) the production of proof satisfactory to it as to the identity and genuineness of any signature or any other matters and (iii) compliance with (A) any laws or governmental regulations relating to the execution and delivery of Receipts and ADSs or to the withdrawal of Deposited Securities and (B) such reasonable regulations of the Depositary or the Company consistent with the Deposit Agreement and applicable law.

The issuance of ADSs against deposits of Shares generally or against deposits of particular Shares may be suspended, or the issuance of ADSs against the deposit of particular Shares may be withheld, or the registration of transfer of Receipts in particular instances may be refused, or the registration of transfer of Receipts generally may be suspended, during any period when the transfer books of the Depositary are closed or if any such action is deemed necessary or advisable by the Depositary or the Company, in good faith, at any time or from time to time because of any requirement of law, any government or governmental body or commission or any securities exchange upon which the Receipts or Share are listed, or under any provision of the Deposit Agreement or provisions of, or governing, the Deposited Securities or any meeting of shareholders of the Company or for any other reason, subject in all cases to Article (22) hereof. Notwithstanding any provision of the Deposit Agreement or this Receipt to the contrary, the Holders of Receipts are entitled to surrender outstanding ADSs to withdraw the Deposited Securities at any time subject only to (i) temporary delays caused by closing the transfer books of the Depositary or the Company or the deposit of Shares in connection with voting at a shareholders’ meeting or the payment of dividends, (ii) the payment of fees, taxes and/or similar charges, (iii) compliance with any U.S. or foreign laws or governmental regulations relating to the Receipts or to the withdrawal of the Deposited Securities, and (iv) other circumstances specifically contemplated by Section I.A.(l) of the General Instructions to Form F-6 (as such General Instructions may be amended from time to time). Without limitation of the foregoing, the Depositary shall not knowingly accept for deposit under the Deposit Agreement any Shares or other Deposited Securities required to be registered under the provisions of the Securities Act, unless a registration statement is in effect as to such Shares.

(5)           Compliance With Information Requests.  Notwithstanding any other provision of the Deposit Agreement or this Receipt, each Holder and Beneficial Owner of the ADSs represented hereby agrees to comply with requests from the Company pursuant to the laws of the Cayman Islands, the rules and requirements of the Nasdaq Capital Market and any other stock exchange on which the Shares are, or will be registered, traded or listed, the Memorandum and Articles of Association, which are made to provide information as to the capacity in which such Holder or Beneficial Owner owns ADSs and regarding the identity of any other person interested in such ADSs and the nature of such interest and various other matters whether or not they are Holders and/or Beneficial Owner at the time of such request. The Depositary agrees to use reasonable efforts to forward any such requests to the Holders and to forward to the Company any such responses to such requests received by the Depositary.

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(6)           Liability of Holder for Taxes, Duties and Other Charges.  If any tax or other governmental charge shall become payable by the Depositary or the Custodian with respect to any Receipt or any Deposited Securities or ADSs, such tax, or other governmental charge shall be payable by the Holders and Beneficial Owners to the Depositary. The Company, the Custodian and/or the Depositary may withhold or deduct from any distributions made in respect of Deposited Securities and may sell for the account of the Holder and/or Beneficial Owner any or all of the Deposited Securities and apply such distributions and sale proceeds in payment of such taxes (including applicable interest and penalties) or charges, with the Holder and the Beneficial Owner hereof remaining fully liable for any deficiency.  The Custodian may refuse the deposit of Shares, and the Depositary may refuse to issue ADSs, to deliver Receipts, register the transfer, split-up or combination of ADRs and (subject to Article (22) hereof) the withdrawal of Deposited Securities, until payment in full of such tax, charge, penalty or interest is received. Every Holder and Beneficial Owner agrees to indemnify the Depositary, the Company, the Custodian and each of their respective agents, directors, employees and Affiliates for, and hold each of them harmless from, any claims with respect to taxes (including applicable interest and penalties thereon) arising from any tax benefit obtained for such Holder and/or Beneficial Owner.

Holders understand that in converting Foreign Currency, amounts received on conversion are calculated at a rate which may exceed the number of decimal places used by the Depositary to report distribution rates (which in any case will not be less than two decimal places).  Any excess amount may be retained by the Depositary as an additional cost of conversion, irrespective of any other fees and expenses payable or owing hereunder and shall not be subject to escheatment.

(7)           Representations and Warranties of Depositors.  Each person depositing Shares under the Deposit Agreement shall be deemed thereby to represent and warrant that (i) such Shares (and the certificates therefor) are duly authorized, validly issued, fully paid, non-assessable and were legally obtained by such person, (ii) all preemptive (and similar) rights, if any, with respect to such Shares, have been validly waived or exercised, (iii) the person making such deposit is duly authorized so to do, (iv) the Shares presented for deposit are free and clear of any lien, encumbrance, security interest, charge, mortgage or adverse claim, and are not, and the ADSs issuable upon such deposit will not be, Restricted Securities (except as contemplated by Section 2.11), (v) the Shares presented for deposit have not been stripped of any rights or entitlements and (vi) the Shares are not subject to any lock-up agreement with the Company or other party, or the Shares are subject to lock-up agreement but such lock-up agreement has terminated or the lock-up restrictions imposed thereunder has expired.  Such representations and warranties shall survive the deposit and withdrawal of Shares and the issuance, cancellation and transfer of ADSs.  If any such representations or warranties are false in any way, the Company and Depositary shall be authorized, at the cost and expense of the person depositing Shares, to take any and all actions necessary to correct the consequences thereof.

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(8)           Filing Proofs, Certificates and Other Information.  Any person presenting Shares for deposit, any Holder and any Beneficial Owner may be required, and every Holder and Beneficial Owner agrees, from time to time to provide to the Depositary such proof of citizenship or residence, taxpayer status, payment of all applicable taxes and/or other governmental charges, exchange control approval, legal or beneficial ownership of ADSs and Deposited Securities, compliance with applicable laws and the terms of the Deposit Agreement and the provisions of, or governing, the Deposited Securities or other information as the Depositary deems necessary or proper or as the Company may reasonably require by written request to the Depositary consistent with its obligations under the Deposit Agreement. Subject to Article (22) hereof and the terms of the Deposit Agreement, the Depositary and the Registrar, as applicable, may withhold the delivery or registration of transfer of any Receipt or the distribution or sale of any dividend or other distribution of rights or of the proceeds thereof or the delivery of any Deposited Securities until such proof or other information is filed, or such certifications are executed, or such representations and warranties made, or such information and documentation are provided.

(9)           Charges of Depositary.  The Depositary reserves the right to charge the following fees for the services performed under the terms of the Deposit Agreement, provided, however, that no fees shall be payable upon distribution of cash dividends so long as the charging of such fee is prohibited by the exchange, if any, upon which the ADSs are listed:

(i)           to any person to whom ADSs are issued or to any person to whom a distribution is made in respect of ADS distributions pursuant to stock dividends or other free distributions of stock, bonus distributions, stock splits or other distributions (except where converted to cash), a fee of up to U.S.$0.05 per ADS so issued under the terms of the Deposit Agreement to be determined by the Depositary;

(ii)           to any person surrendering ADSs for cancellation and withdrawal of Deposited Securities including, inter alia, cash distributions made pursuant to a cancellation or withdrawal, a fee of up to U.S.$0.05 per ADS so surrendered;

(iii)          to any Holder of ADSs, a fee of up to U.S.$0.05 per ADS  held for the distribution of cash proceeds, including cash dividends or sale of rights and other entitlements, not made pursuant to a cancellation or withdrawal;

(iv)          to any holder of ADSs, a fee of up to U.S.$0.05 per ADS issued upon the exercise of rights; and

(v)           for the operation and maintenance costs in administering the ADSs an annual fee of up to U.S.$0.05 per ADS, such fee to be assessed against Holders of record as of the date or dates set by the Depositary as it sees fit and collected at the sole discretion of the Depositary by billing such Holders for such fee or by deducting such fee from one or more cash dividends or other cash distributions.

In addition, Holders, Beneficial Owners, any depositor depositing Shares for deposit and any person surrendering ADSs for cancellation and withdrawal of Deposited Securities will be required to pay the following charges:

(i)           taxes (including applicable interest and penalties) and other governmental charges;

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(ii)           such registration fees as may from time to time be in effect for the registration of Shares or other Deposited Securities with the Foreign Registrar and applicable to transfers of Shares or other Deposited Securities to or from the name of the Custodian, the Depositary or any nominees upon the making of deposits and withdrawals, respectively;

(iii)          such cable, telex, facsimile and electronic transmission and delivery expenses as are expressly provided in the Deposit Agreement to be at the expense of the depositor depositing or person withdrawing Shares or Holders and Beneficial Owners of ADSs;

(iv)          the expenses and charges incurred by the Depositary in the conversion of Foreign Currency;

(v)           such fees and expenses as are incurred by the Depositary in connection with compliance with exchange control regulations and other regulatory requirements applicable to Shares, Deposited Securities, ADSs and ADRs;

(vi)           the fees and expenses incurred by the Depositary in connection with the delivery of Deposited Securities, including any fees of a central depository for securities in the local market, where applicable;

(vii)          any additional fees, charges, costs or expenses that may be incurred by the Depositary from time to time.

Any other fees and charges of, and expenses incurred by, the Depositary or the Custodian under the Deposit Agreement shall be for the account of the Company unless otherwise agreed in writing between the Company and the Depositary from time to time.  All fees and charges may, at any time and from time to time, be changed by agreement between the Depositary and Company but, in the case of fees and charges payable by Holders or Beneficial Owners, only in the manner contemplated by Article (20) hereof.

(10)         Title to Receipts.  It is a condition of this Receipt, and every successive Holder of this Receipt by accepting or holding the same consents and agrees, that title to this Receipt (and to each ADS evidenced hereby) is transferable by delivery of the Receipt, provided it has been properly endorsed or accompanied by proper instruments of transfer, such Receipt being a certificated security under the laws of the State of New York.  Notwithstanding any notice to the contrary, the Depositary may deem and treat the Holder of this Receipt (that is, the person in whose name this Receipt is registered on the books of the Depositary) as the absolute owner hereof for all purposes.  The Depositary shall have no obligation or be subject to any liability under the Deposit Agreement or this Receipt to any holder of this Receipt or any Beneficial Owner unless such holder is the Holder of this Receipt registered on the books of the Depositary or, in the case of a Beneficial Owner, such Beneficial Owner or the Beneficial Owner’s representative is the Holder registered on the books of the Depositary.

(11)         Validity of Receipt.  This Receipt shall not be entitled to any benefits under the Deposit Agreement or be valid or enforceable for any purpose, unless this Receipt has been (i) dated, (ii) signed by the manual or facsimile signature of a duly authorized signatory of the Depositary, (iii) if a Registrar for the Receipts shall have been appointed, countersigned by the manual or facsimile signature of a duly authorized signatory of the Registrar and (iv) registered in the books maintained by the Depositary or the Registrar, as applicable, for the issuance and transfer of Receipts.  Receipts bearing the facsimile signature of a duly-authorized signatory of the Depositary or the Registrar, who at the time of signature was a duly-authorized signatory of the Depositary or the Registrar, as the case may be, shall bind the Depositary, notwithstanding the fact that such signatory has ceased to be so authorized prior to the execution and delivery of such Receipt by the Depositary or did not hold such office on the date of issuance of such Receipts.

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(12)         Available Information; Reports; Inspection of Transfer Books.  The Company is subject to the periodic reporting requirements of the Exchange Act applicable to foreign private issuers (as defined in Rule 405 of the Securities Act) and accordingly files certain information with the Commission.  These reports and documents can be inspected and copied at the public reference facilities maintained by the Commission located at 100 F Street, N.E., Washington D.C. 20549, U.S.A.The Depositary shall make available during normal business hours on any Business Day for inspection by Holders at its Corporate Trust Office any reports and communications, including any proxy soliciting materials, received from the Company which are both (a) received by the Depositary, the Custodian, or the nominee of either of them as the holder of the Deposited Securities and (b) made generally available to the holders of such Deposited Securities by the Company.

The Depositary or the Registrar, as applicable, shall keep books for the registration of Receipts and transfers of Receipts which at all reasonable times shall be open for inspection by the Company and by the Holders of such Receipts, provided that such inspection shall not be, to the Depositary’s or the Registrar’s knowledge, for the purpose of communicating with Holders of such Receipts in the interest of a business or object other than the business of the Company or other than a matter related to the Deposit Agreement or the Receipts.

The Depositary or the Registrar, as applicable, may close the transfer books with respect to the Receipts, at any time or from time to time, when deemed necessary or advisable by it in good faith in connection with the performance of its duties hereunder, or at the reasonable written request of the Company subject, in all cases, to Article (22) hereof.

Dated:	DEUTSCHE BANK TRUST
	COMPANY AMERICAS, as Depositary
	By:
	By:

The address of the Corporate Trust Office of the Depositary is 60 Wall Street, New York, New York 10005, U.S.A.

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EXHIBIT B

[FORM OF REVERSE OF RECEIPT]

SUMMARY OF CERTAIN ADDITIONAL PROVISIONS

OF THE DEPOSIT AGREEMENT

(13)         Dividends and Distributions in Cash, Shares, etc.  Whenever the Depositary receives confirmation from the Custodian of receipt of any cash dividend or other cash distribution on any Deposited Securities, or receives proceeds from the sale of any Shares, rights securities or other entitlements under the Deposit Agreement, the Depositary will, if at the time of receipt thereof any amounts received in a Foreign Currency can, in the judgment of the Depositary (upon the terms of the Deposit Agreement), be converted on a practicable basis, into Dollars transferable to the United States, promptly convert or cause to be converted such dividend, distribution or proceeds into Dollars and will distribute promptly the amount thus received (net of applicable fees and charges of, and expenses incurred by, the Depositary and taxes and/or governmental charges) to the Holders of record as of the ADS Record Date in proportion to the number of ADS representing such Deposited Securities held by such Holders respectively as of the ADS Record Date.  The Depositary shall distribute only such amount, however, as can be distributed without attributing to any Holder a fraction of one cent.  Any such fractional amounts shall be rounded to the nearest whole cent and so distributed to Holders entitled thereto.  If the Company, the Custodian or the Depositary is required to withhold and does withhold from any cash dividend or other cash distribution in respect of any Deposited Securities an amount on account of taxes, duties or other governmental charges, the amount distributed to Holders on the ADSs representing such Deposited Securities shall be reduced accordingly. Such withheld amounts shall be forwarded by the Company, the Custodian or the Depositary to the relevant governmental authority.  Any Foreign Currency received by the Depositary shall be converted upon the terms and conditions set forth in the Deposit Agreement.

If any distribution upon any Deposited Securities consists of a dividend in, or free distribution of, Shares, the Company shall cause such Shares to be deposited with the Custodian and registered, as the case may be, in the name of the Depositary, the Custodian or their nominees.  Upon receipt of confirmation of such deposit, the Depositary shall, subject to and in accordance with the Deposit Agreement, establish the ADS Record Date and either (i) distribute to the Holders as of the ADS Record Date in proportion to the number of ADSs held as of the ADS Record Date, additional ADSs, which represent in aggregate the number of Shares received as such dividend, or free distribution, subject to the terms of the Deposit Agreement (including, without limitation, the applicable fees and charges of, and expenses incurred by, the Depositary, and taxes and/or governmental charges), or (ii) if additional ADSs are not so distributed, each ADS issued and outstanding after the ADS Record Date shall, to the extent permissible by law, thenceforth also represent rights and interests in the additional Shares distributed upon the Deposited Securities represented thereby (net of the applicable fees and charges of, and the expenses incurred by, the Depositary, and taxes and/or governmental charges).  In lieu of delivering fractional ADSs, the Depositary shall sell the number of Shares represented by the aggregate of such fractions and distribute the proceeds upon the terms set forth in the Deposit Agreement.

In the event that (x) the Depositary determines that any distribution in property (including Shares) is subject to any tax or other governmental charges which the Depositary is obligated to withhold, or, (y) if the Company, in the fulfillment of its obligations under the Deposit Agreement, has either (a) furnished an opinion of U.S. counsel determining that Shares must be registered under the Securities Act or other laws in order to be distributed to Holders (and no such registration statement has been declared effective), or (b) fails to timely deliver the documentation contemplated in the Deposit Agreement, the Depositary may dispose of all or a portion of such property (including Shares and rights to subscribe therefor) in such amounts and in such manner, including by public or private sale, as the Depositary deems necessary and practicable, and the Depositary shall distribute the net proceeds of any such sale (after deduction of taxes and/or governmental charges, and fees and charges of, and expenses incurred by, the Depositary) to Holders entitled thereto upon the terms of the Deposit Agreement. The Depositary shall hold and/or distribute any unsold balance of such property in accordance with the provisions of the Deposit Agreement.

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Upon timely receipt of a notice indicating that the Company wishes an elective distribution to be made available to Holders upon the terms described in the Deposit Agreement, the Depositary shall, upon provision of all documentation required under the Deposit Agreement, (including, without limitation, any legal opinions the Depositary may request under the Deposit Agreement) determine whether such distribution is lawful and reasonably practicable.  If so, the Depositary shall, subject to the terms and conditions of the Deposit Agreement, establish an ADS Record Date according to Article (14) hereof and establish procedures to enable the Holder hereof to elect to receive the proposed distribution in cash or in additional ADSs.  If a Holder elects to receive the distribution in cash, the dividend shall be distributed as in the case of a distribution in cash.  If the Holder hereof elects to receive the distribution in additional ADSs, the distribution shall be distributed as in the case of a distribution in Shares upon the terms described in the Deposit Agreement.  If such elective distribution is not lawful or reasonably practicable or if the Depositary did not receive satisfactory documentation set forth in the Deposit Agreement, the Depositary shall, to the extent permitted by law, distribute to Holders, on the basis of the same determination as is made in the Cayman Islands, in respect of the Shares for which no election is made, either (x) cash or (y) additional ADSs representing such additional Shares, in each case, upon the terms described in the Deposit Agreement.  Nothing herein shall obligate the Depositary to make available to the Holder hereof a method to receive the elective distribution in Shares (rather than ADSs).  There can be no assurance that the Holder hereof will be given the opportunity to receive elective distributions on the same terms and conditions as the holders of Shares.

Upon receipt by the Depositary of a notice indicating that the Company wishes rights to subscribe for additional Shares to be made available to Holders of ADSs, the Company shall determine whether it is lawful and reasonably practicable to make such rights available to the Holders. The Depositary shall make such rights available to any Holders only if the Company shall have timely requested that such rights be made available to Holders, the Depositary shall have received the documentation required by the Deposit Agreement, and the Depositary shall have determined that such distribution of rights is lawful and reasonably practicable.  If such conditions are not satisfied, the Depositary shall sell the rights as described below.  In the event all conditions set forth above are satisfied, the Depositary shall establish an ADS Record Date and establish procedures (x) to distribute such rights (by means of warrants or otherwise) and (y) to enable the Holders to exercise the rights (upon payment of the applicable fees and charges of, and expenses incurred by, the Depositary and taxes and/or governmental charges).  Nothing herein or in the Deposit Agreement shall obligate the Depositary to make available to the Holders a method to exercise such rights to subscribe for Shares (rather than ADSs).  If (i) the Company does not timely request the Depositary to make the rights available to Holders or if the Company requests that the rights not be made available to Holders, (ii) the Depositary fails to receive the documentation required by the Deposit Agreement or determines it is not lawful or reasonably practicable to make the rights available to Holders, or (iii) any rights made available are not exercised and appear to be about to lapse, the Depositary shall determine whether it is lawful and reasonably practicable to sell such rights, in a riskless principal capacity or otherwise, at such place and upon such terms (including public and/or private sale) as it may deem proper.  The Depositary shall, upon such sale, convert and distribute proceeds of such sale (net of applicable fees and charges of, and expenses incurred by, the Depositary and taxes and/or governmental charges) upon the terms hereof and in the Deposit Agreement.  If the Depositary is unable to make any rights available to Holders or to arrange for the sale of the rights upon the terms described above, the Depositary shall allow such rights to lapse.  The Depositary shall not be responsible for (i) any failure to determine that it may be lawful or practicable to make such rights available to Holders in general or any Holders in particular, (ii) any foreign exchange exposure or loss incurred in connection with such sale, or exercise, or (iii) the content of any materials forwarded to the Holders on behalf of the Company in connection with the rights distribution.

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Notwithstanding anything herein to the contrary, if registration (under the Securities Act and/or any other applicable law) of the rights or the securities to which any rights relate may be required in order for the Company to offer such rights or such securities to Holders and to sell the securities represented by such rights, the Depositary will not distribute such rights to the Holders (i) unless and until a registration statement under the Securities Act covering such offering is in effect or (ii) unless the Company furnishes to the Depositary opinion(s) of counsel for the Company in the United States and counsel to the Company in any other applicable country in which rights would be distributed, in each case satisfactorily to the Depositary, to the effect that the offering and sale of such securities to Holders and Beneficial Owners are exempt from, or do not require registration under, the provisions of the Securities Act or any other applicable laws.  In the event that the Company, the Depositary or the Custodian shall be required to withhold and does withhold from any distribution of property (including rights) an amount on account of taxes and/or other governmental charges, the amount distributed to the Holders shall be reduced accordingly. In the event that the Depositary determines that any distribution in property (including Shares and rights to subscribe therefor) is subject to any tax or other governmental charges which the Depositary is obligated to withhold, the Depositary may dispose of all or a portion of such property (including Shares and rights to subscribe therefor) in such amounts and in such manner, including by public or private sale, as the Depositary deems necessary and practicable to pay any such taxes and/or charges.

There can be no assurance that Holders generally, or any Holder in particular, will be given the opportunity to exercise rights on the same terms and conditions as the holders of Shares or to exercise such rights.  Nothing herein shall obligate the Company to file any registration statement in respect of any rights or Shares or other securities to be acquired upon the exercise of such rights or otherwise to register or qualify the offer or sale of such rights or securities under the applicable law of any other jurisdiction for any purpose.

Upon receipt of a notice regarding property other than cash, Shares or rights to purchase additional Shares, to be made to Holders of ADSs, the Depositary shall determine, after consultation with the Company, whether such distribution to Holders is lawful and reasonably practicable.  The Depositary shall not make such distribution unless (i) the Company shall have timely requested the Depositary to make such distribution to Holders, (ii) the Depositary shall have received the documentation required by the Deposit Agreement, and (iii) the Depositary shall have determined that such distribution is lawful and reasonably practicable.  Upon satisfaction of such conditions, the Depositary shall distribute the property so received to the Holders of record as of the ADS Record Date, in proportion to the number of ADSs held by such Holders respectively and in such manner as the Depositary may deem practicable for accomplishing such distribution (i) upon receipt of payment or net of the applicable fees and charges of, and expenses incurred by, the Depositary, and (ii) net of any taxes and/or governmental charges.  The Depositary may dispose of all or a portion of the property so distributed and deposited, in such amounts and in such manner (including public or private sale) as the Depositary may deem practicable or necessary to satisfy any taxes (including applicable interest and penalties) or other governmental charges applicable to the distribution.

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If the conditions above are not satisfied, the Depositary shall sell or cause such property to be sold in a public or private sale, at such place or places and upon such terms as it may deem proper and shall distribute the proceeds of such sale received by the Depositary (net of (a) applicable fees and charges of, and expenses incurred by, the Depositary and (b) taxes and/or governmental charges) to the Holders upon the terms hereof and of the Deposit Agreement.  If the Depositary is unable to sell such property, the Depositary may dispose of such property in any way it deems reasonably practicable under the circumstances.

(14)         Fixing of Record Date.  Whenever necessary in connection with any distribution (whether in cash, shares, rights or other distribution), or whenever for any reason the Depositary causes a change in the number of Shares that are represented by each ADS, or whenever the Depositary shall receive notice of any meeting of or solicitation of holders of Shares or other Deposited Securities, or whenever the Depositary shall find it necessary or convenient in connection with the giving of any notice, or any other matter, the Depositary shall fix a record date (“ADS Record Date”), as close as practicable to the record date fixed by the Company with respect to the Shares (if applicable), for the determination of the Holders who shall be entitled to receive such distribution, to give instructions for the exercise of voting rights at any such meeting, or to give or withhold such consent, or to receive such notice or solicitation or to otherwise take action, or to exercise the rights of Holders with respect to such changed number of Shares represented by each ADS or for any other reason. Subject to applicable law and the terms and conditions of this Receipt and the Deposit Agreement, only the Holders of record at the close of business in New York on such ADS Record Date shall be entitled to receive such distributions, to give such voting instructions, to receive such notice or solicitation, or otherwise take action.

(15)         Voting of Deposited Securities.  Subject to the next sentence, as soon as practicable after receipt of notice of any meeting at which the holders of Shares or other Deposited Securities are entitled to vote, or of solicitation of consents or proxies from holders of Shares or other Deposited Securities, the Depositary shall fix the ADS Record Date in respect of such meeting or solicitation of consent or proxy. The Depositary shall, if requested by the Company in writing in a timely manner (the Depositary having no obligation to take any further action if the request shall not have been received by the Depositary at least 30 Business Days prior to the date of such vote or meeting) and at the Company’s expense and provided no U.S. legal prohibitions exist, mail by regular, ordinary mail delivery, or by electronic transmission, or otherwise distribute as soon as practicable after receipt thereof to Holders as of the ADS Record Date: (a) such notice of meeting or solicitation of consent or proxy; (b) a statement that the Holders at the close of business on the ADS Record Date will be entitled, subject to any applicable law, the Memorandum and Articles of Association and the provisions of or governing the Deposited Securities (which provisions, if any, shall be summarized in pertinent part by the Company), to instruct the Depositary as to the exercise of the voting rights, if any, pertaining to the Shares or other Deposited Securities represented by such Holder’s American Depositary Shares; and (c) a brief statement as to the manner in which such instructions may be given to the Depositary or in which voting instructions may be deemed to have been given in accordance with Section 4.8 of the Deposit Agreement, including an express indication that instructions may be given (or deemed to have been given in accordance with the immediately following paragraph of this section) to the Depositary to give a discretionary proxy to a person or persons designated by the Company.  Voting instructions may be given only in respect of a number of American Depositary Shares representing an integral number of Shares or other Deposited Securities.  Upon the timely receipt from a Holder of American Depositary Shares on the ADS Record Date of written voting instructions in the manner specified by the Depositary, the Depositary shall endeavor, insofar as practicable and permitted under applicable law, the provisions of this Deposit Agreement, the Memorandum and Articles of Association and the provisions of or governing the Deposited Securities, to vote or cause the Custodian to vote the Shares and/or other Deposited Securities (in person or by proxy) represented by American Depositary Shares evidenced by such Receipt in accordance with such voting instructions.

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In the event that the (i) Depositary timely receives voting instructions from a Holder which fail to specify the manner in which the Depositary is to vote the Deposited Securities represented by such Holder’s ADSs or (ii) no timely instructions are received by the Depositary from a Holder with respect to any of the Deposited Securities represented by the ADSs held by such Holder on the ADS Record Date, the Depositary shall (unless otherwise specified in the notice distributed to Holders) deem such Holder to have instructed the Depositary to give a discretionary proxy to a person designated by the Company with respect to such Deposited Securities and the Depositary shall give a discretionary proxy to a person designated by the Company to vote such Deposited Securities, provided, however, that no such instruction shall be deemed to have been given and no such discretionary proxy shall be given with respect to any matter as to which the Company informs the Depositary (and the Company agrees to provide such information as promptly as practicable in writing, if applicable) that (x) the Company does not wish to give such proxy, (y) the Company is aware or should reasonably be aware that substantial opposition exists from Holders against the outcome for which the person designated by the Company would otherwise vote or (z) the outcome for which the person designated by the Company would otherwise vote would materially and adversely affect the rights of holders of Shares, provided, further, that the Company will have no liability to any Holder or Beneficial Owner resulting from such notification.

In the event that voting on any resolution or matter is conducted on a show of hands basis in accordance with the Memorandum and Articles of Association, the Depositary will refrain from voting and the voting instructions (or the deemed voting instructions, as set out above) received by the Depositary from Holders shall lapse.  The Depositary will have no obligation to demand voting on a poll basis with respect to any resolution and shall have no liability to any Holder or Beneficial Owner for not having demanded voting on a poll basis.

Neither the Depositary nor the Custodian shall, under any circumstances exercise any discretion as to voting, and neither the Depositary nor the Custodian shall vote, attempt to exercise the right to vote, or in any way make use of for purposes of establishing a quorum or otherwise, the Shares or other Deposited Securities represented by ADSs except pursuant to and in accordance with such written instructions from Holders, including the deemed instruction to the Depositary to give a discretionary proxy to a person designated by the Company.  Shares or other Deposited Securities represented by ADSs for which (i) no timely voting instructions are received by the Depositary from the Holder, or (ii) timely voting instructions are received by the Depositary from the Holder but such voting instructions fail to specify the manner in which the Depositary is to vote the Deposited Securities represented by such Holder’s ADSs, shall be voted in the manner provided in Section 4.8 of the Deposit Agreement.  Notwithstanding anything else contained herein, and subject to applicable law, regulation and the Memorandum and Articles of Association, the Depositary shall, if so requested in writing by the Company, represent all Deposited Securities (whether or not voting instructions have been received in respect of such Deposited Securities from Holders as of the ADS Record Date) for the purpose of establishing quorum at a meeting of shareholders.

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There can be no assurance that Holders or Beneficial Owners generally or any Holder or Beneficial Owner in particular will receive the notice described above with sufficient time to enable the Holder to return voting instructions to the Depositary in a timely manner.

Notwithstanding the above, save for applicable provisions of the law of the Cayman Islands, and in accordance with the terms of Section 5.3 of the Deposit Agreement, the Depositary shall not be liable for any failure to carry out any instructions to vote any of the Deposited Securities or the manner in which such vote is cast or the effect of such vote.

(16)         Changes Affecting Deposited Securities.  Upon any change in par value, split-up, subdivision, cancellation, consolidation or any other reclassification of Deposited Securities, or upon any recapitalization, reorganization, merger, amalgamation or consolidation or sale of assets affecting the Company or to which it otherwise is a party, any securities which shall be received by the Depositary or a Custodian in exchange for, or in conversion of or replacement or otherwise in respect of, such Deposited Securities shall, to the extent permitted by law, be treated as new Deposited Securities under the Deposit Agreement, and the Receipts shall, subject to the provisions of the Deposit Agreement and applicable law, evidence ADSs representing the right to receive such additional securities. Alternatively, the Depositary may, with the Company’s approval, and shall, if the Company shall so request, subject to the terms of the Deposit Agreement and receipt of satisfactory documentation contemplated by the Deposit Agreement, execute and deliver additional Receipts as in the case of a stock dividend on the Shares, or call for the surrender of outstanding Receipts to be exchanged for new Receipts, in either case, as well as in the event of newly deposited Shares, with necessary modifications to this form of Receipt specifically describing such new Deposited Securities and/or corporate change. Notwithstanding the foregoing, in the event that any security so received may not be lawfully distributed to some or all Holders, the Depositary may, with the Company’s approval, and shall if the Company requests, subject to receipt of satisfactory legal documentation contemplated in the Deposit Agreement, sell such securities at public or private sale, at such place or places and upon such terms as it may deem proper and may allocate the net proceeds of such sales (net of fees and charges of, and expenses incurred by, the Depositary and taxes and/or governmental charges) for the account of the Holders otherwise entitled to such securities and distribute the net proceeds so allocated to the extent practicable as in the case of a distribution received in cash pursuant to the Deposit Agreement. The Depositary shall not be responsible for (i) any failure to determine that it may be lawful or feasible to make such securities available to Holders in general or any Holder in particular, (ii) any foreign exchange exposure or loss incurred in connection with such sale, or (iii) any liability to the purchaser of such securities.

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(17)         Exoneration.  Neither the Depositary, the Custodian or the Company shall be obligated to do or perform any act which is inconsistent with the provisions of the Deposit Agreement or shall incur any liability (i) if the Depositary, the Custodian or the Company or their respective controlling persons or agents shall be prevented or forbidden from, or subjected to any civil or criminal penalty or restraint on account of, or delayed in, doing or performing any act or thing required by the terms of the Deposit Agreement and this Receipt, by reason of any provision of any present or future law or regulation of the United States, the Cayman Islands or any other country, or of any other governmental authority or regulatory authority or stock exchange, or by reason of any provision, present or future of the Memorandum and Articles of Association or any provision of or governing any Deposited Securities, or by reason of any act of God or war or other circumstances beyond its control, (including, without limitation, nationalization, expropriation, currency restrictions, work stoppage, strikes, civil unrest, revolutions, rebellions, explosions and computer failure), (ii) by reason of any exercise of, or failure to exercise, any discretion provided for in the Deposit Agreement or in the Memorandum and Articles of Association or provisions of or governing Deposited Securities, (iii) for any action or inaction of the Depositary, the Custodian or the Company or their respective controlling persons or agents in reliance upon the advice of or information from legal counsel, accountants, any person presenting Shares for deposit, any Holder, any Beneficial Owner or authorized representative thereof, or any other person believed by it in good faith to be competent to give such advice or information, (iv) for any inability by a Holder or Beneficial Owner to benefit from any distribution, offering, right or other benefit which is made available to holders of Deposited Securities but is not, under the terms of the Deposit Agreement, made available to Holders of ADS or (v) for any consequential or punitive damages for any breach of the terms of the Deposit Agreement.  The Depositary, its controlling persons, its agents, any Custodian and the Company, its controlling persons and its agents may rely and shall be protected in acting upon any written notice, request, opinion or other document believed by it to be genuine and to have been signed or presented by the proper party or parties.  No disclaimer of liability under the Securities Act is intended by any provision of the Deposit Agreement.

(18)         Standard of Care.  The Company and the Depositary and their respective directors, officers, affiliates, employees and agents assume no obligation and shall not be subject to any liability under the Deposit Agreement or the Receipts to Holders or Beneficial Owners or other persons, except in accordance with Section 5.8 of the Deposit Agreement, provided, that the Company and the Depositary and their respective directors, officers, affiliates, employees and agents agree to perform their respective obligations specifically set forth in the Deposit Agreement without gross negligence or bad faith.  The Depositary and its directors, officers, affiliates, employees and agents shall not be liable for any failure to carry out any instructions to vote any of the Deposited Securities, or for the manner in which any vote is cast or the effect of any vote, provided that any such action or omission is in good faith and in accordance with the terms of the Deposit Agreement.  The Depositary shall not incur any liability for any failure to determine that any distribution or action may be lawful or reasonably practicable, for the content of any information submitted to it by the Company for distribution to the Holders or for any inaccuracy of any translation thereof, for any investment risk associated with acquiring an interest in the Deposited Securities, for the validity or worth of the Deposited Securities or for any tax consequences that may result from the ownership of ADSs, Shares or Deposited Securities, for the credit-worthiness of any third party, for allowing any rights to lapse upon the terms of the Deposit Agreement or for the failure or timeliness of any notice from the Company.  In no event shall the Depositary or any of its Agents be liable for any indirect, special, punitive or consequential damage.

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(19)         Resignation and Removal of the Depositary; Appointment of Successor Depositary.  The Depositary may at any time resign as Depositary under the Deposit Agreement by written notice of resignation delivered to the Company, such resignation to be effective on the earlier of (i) the 90th day after delivery thereof to the Company, or (ii) upon the appointment of a successor depositary and its acceptance of such appointment as provided in the Deposit Agreement, save that, any amounts, fees, costs or expenses owed to the Depositary under the Deposit Agreement or in accordance with any other agreements otherwise agreed in writing between the Company and the Depositary from time to time shall be paid to the Depositary prior to such resignation. The Company shall use reasonable efforts to appoint such successor depositary, and give notice to the Depositary of such appointment, not more than 90 days after delivery by the Depositary of written notice of resignation as provided in the Deposit Agreement.  The Depositary may at any time be removed by the Company by written notice of such removal which notice shall be effective on the later of (i) the 90th day after delivery thereof to the Depositary, or (ii) upon the appointment of a successor depositary and its acceptance of such appointment as provided in the Deposit Agreement save that, any amounts, fees, costs or expenses owed to the Depositary under the Deposit Agreement or in accordance with any other agreements otherwise agreed in writing between the Company and the Depositary from time to time shall be paid to the Depositary prior to such removal. In case at any time the Depositary acting hereunder shall resign or be removed, the Company shall use its best efforts to appoint a successor depositary which shall be a bank or trust company having an office in the Borough of Manhattan, the City of New York. Every successor depositary shall execute and deliver to its predecessor and to the Company an instrument in writing accepting its appointment hereunder, and thereupon such successor depositary, without any further act or deed, shall become fully vested with all the rights, powers, duties and obligations of its predecessor.  The predecessor depositary, upon payment of all sums due it and on the written request of the Company, shall (i) execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder (other than as contemplated in the Deposit Agreement), (ii) duly assign, transfer and deliver all right, title and interest to the Deposited Securities to such successor, and (iii) deliver to such successor a list of the Holders of all outstanding Receipts and such other information relating to Receipts and Holders thereof as the successor may reasonably request. Any such successor depositary shall promptly mail notice of its appointment to such Holders.  Any corporation into or with which the Depositary may be merged or consolidated shall be the successor of the Depositary without the execution or filing of any document or any further act.

(20)         Amendment/Supplement.  Subject to the terms and conditions of this Article (20), and applicable law, this Receipt and any provisions of the Deposit Agreement may at any time and from time to time be amended or supplemented by written agreement between the Company and the Depositary in any respect which they may deem necessary or desirable without the consent of the Holders or Beneficial Owners. Any amendment or supplement which shall impose or increase any fees or charges (other than the charges of the Depositary in connection with foreign exchange control regulations, and taxes and/or other governmental charges, delivery and other such expenses), or which shall otherwise materially prejudice any substantial existing right of Holders or Beneficial Owners, shall not, however, become effective as to outstanding Receipts until 30 days after notice of such amendment or supplement shall have been given to the Holders of outstanding Receipts. Notice of any amendment to the Deposit Agreement or form of Receipts shall not need to describe in detail the specific amendments effectuated thereby, and failure to describe the specific amendments in any such notice shall not render such notice invalid, provided, however, that, in each such case, the notice given to the Holders identifies a means for Holders and Beneficial Owners to retrieve or receive the text of such amendment (i.e., upon retrieval from the Commission's, the Depositary's or the Company's website or upon request from the Depositary). The parties hereto agree that any amendments or supplements which (i) are reasonably necessary (as agreed by the Company and the Depositary) in order for (a) the ADSs to be registered on Form F-6 under the Securities Act or (b) the ADSs or Shares to be traded solely in electronic book-entry form and (ii) do not in either such case impose or increase any fees or charges to be borne by Holders, shall be deemed not to materially prejudice any substantial rights of Holders or Beneficial Owners. Every Holder and Beneficial Owner at the time any amendment or supplement so becomes effective shall be deemed, by continuing to hold such ADS, to consent and agree to such amendment or supplement and to be bound by the Deposit Agreement as amended or supplemented thereby. In no event shall any amendment or supplement impair the right of the Holder to surrender such Receipt and receive therefor the Deposited Securities represented thereby, except in order to comply with mandatory provisions of applicable law. Notwithstanding the foregoing, if any governmental body should adopt new laws, rules or regulations which would require amendment or supplement of the Deposit Agreement to ensure compliance therewith, the Company and the Depositary may amend or supplement the Deposit Agreement and the Receipt at any time in accordance with such changed laws, rules or regulations. Such amendment or supplement to the Deposit Agreement in such circumstances may become effective before a notice of such amendment or supplement is given to Holders or within any other period of time as required for compliance with such laws, or rules or regulations.

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(21)         Termination.  The Depositary shall, at any time at the written direction of the Company, terminate the Deposit Agreement by mailing notice of such termination to the Holders of all Receipts then outstanding at least 90 days prior to the date fixed in such notice for such termination provided that, the Depositary shall be reimbursed for any amounts, fees, costs or expenses owed to it in accordance with the terms of the Deposit Agreement and in accordance with any other agreements as otherwise agreed in writing between the Company and the Depositary from time to time, prior to such termination shall take effect. If 90 days shall have expired after (i) the Depositary shall have delivered to the Company a written notice of its election to resign, or (ii) the Company shall have delivered to the Depositary a written notice of the removal of the Depositary, and in either case a successor depositary shall not have been appointed and accepted its appointment as provided herein and in the Deposit Agreement, the Depositary may terminate the Deposit Agreement by mailing notice of such termination to the Holders of all Receipts then outstanding at least 30 days prior to the date fixed for such termination. On and after the date of termination of the Deposit Agreement, the Holder will, upon surrender of such Holder’s Receipt at the Corporate Trust Office of the Depositary, upon the payment of the charges of the Depositary for the surrender of Receipts referred to in Article (2) hereof and in the Deposit Agreement and subject to the conditions and restrictions therein set forth, and upon payment of any applicable taxes and/or governmental charges, be entitled to delivery, to him or upon his order, of the amount of Deposited Securities represented by such Receipt. If any Receipts shall remain outstanding after the date of termination of the Deposit Agreement, the Registrar thereafter shall discontinue the registration of transfers of Receipts, and the Depositary shall suspend the distribution of dividends to the Holders thereof, and shall not give any further notices or perform any further acts under the Deposit Agreement, except that the Depositary shall continue to collect dividends and other distributions pertaining to Deposited Securities, shall sell rights as provided in the Deposit Agreement, and shall continue to deliver Deposited Securities, subject to the conditions and restrictions set forth in the Deposit Agreement, together with any dividends or other distributions received with respect thereto and the net proceeds of the sale of any rights or other property, in exchange for Receipts surrendered to the Depositary (after deducting, or charging, as the case may be, in each case the charges of the Depositary for the surrender of a Receipt, any expenses for the account of the Holder in accordance with the terms and conditions of the Deposit Agreement and any applicable taxes and/or governmental charges or assessments). At any time after the expiration of six months from the date of termination of the Deposit Agreement, the Depositary may sell the Deposited Securities then held hereunder and may thereafter hold uninvested the net proceeds of any such sale, together with any other cash then held by it hereunder, in an unsegregated account, without liability for interest for the pro rata benefit of the Holders of Receipts whose Receipts have not theretofore been surrendered. After making such sale, the Depositary shall be discharged from all obligations under the Deposit Agreement with respect to the Receipts and the Shares, Deposited Securities and ADSs, except to account for such net proceeds and other cash (after deducting, or charging, as the case may be, in each case the charges of the Depositary for the surrender of a Receipt, any expenses for the account of the Holder in accordance with the terms and conditions of the Deposit Agreement and any applicable taxes and/or governmental charges or assessments) and except as set forth in the Deposit Agreement. Upon the termination of the Deposit Agreement, the Company shall be discharged from all obligations under the Deposit Agreement except as set forth in the Deposit Agreement.

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(22)         Compliance with U.S. Securities Laws; Regulatory Compliance.  Notwithstanding any provisions in this Receipt or the Deposit Agreement to the contrary, the withdrawal or delivery of Deposited Securities will not be suspended by the Company or the Depositary except as would be permitted by Section I.A.(1) of the General Instructions to the Form F-6 Registration Statement, as amended from time to time, under the Securities Act.

(23)         Certain Rights of the Depositary; Limitations.  Subject to the further terms and provisions of this Article (23), the Depositary, its Affiliates and their agents, on their own behalf, may own and deal in any class of securities of the Company and its Affiliates and in ADSs. The Depositary may issue ADSs against evidence of rights to receive Shares from the Company, any agent of the Company or any custodian, registrar, transfer agent, clearing agency or other entity involved in ownership or transaction records in respect of the Shares.  Such evidence of rights shall consist of written blanket or specific guarantees of ownership of Shares furnished on behalf of the holder thereof.  In its capacity as Depositary, the Depositary shall not lend Shares or ADSs; provided, however, that the Depositary may (i) issue ADSs prior to the receipt of Shares pursuant to Section 2.3 of the Deposit Agreement and (ii) deliver Shares prior to the receipt and cancellation of ADSs which were issued under (i) above but for which Shares may not yet have been received (each such transaction a “Pre-Release Transaction”).  The Depositary may receive ADSs in lieu of Shares under (i) above and receive shares in lieu of ADSs under (ii) above.  Each such Pre-Release Transaction will be (a) accompanied by or subject to a written agreement whereby the person or entity (the “Applicant”) to whom ADSs or Shares are to be delivered (1) represents that at the time of the Pre-Release Transaction the Applicant or its customer owns the Shares or ADSs that are to be delivered by the Applicant under such Pre-Release Transaction, (2) agrees to indicate the Depositary as owner of such Shares or ADSs in its records and to hold such Shares or ADSs in trust for the Depositary until such Shares or ADSs are delivered to the Depositary or the Custodian, (3) unconditionally guarantees to deliver to the Depositary or the Custodian, as applicable, such Shares or ADSs and (4) agrees to any additional restrictions or requirements that the Depositary deems appropriate, (b) at all times fully collateralized with cash, United States government securities or such other collateral as the Depositary deems appropriate, (c) terminable by the Depositary on not more than five business days’ notice (save for a prescribed termination event in which case any such Pre-Release Transaction may be immediately terminable by the Depositary) and (d) subject to such further indemnities and credit regulations as the Depositary deems appropriate.  The Depositary will normally limit the number of ADSs and Shares involved in such Pre-Release Transactions at any one time to 30% of the ADSs outstanding (without giving effect to ADSs outstanding pursuant to any Pre-Release Transaction under (i) above), provided, however, that the Depositary reserves the right to change or disregard such limit from time to time as it deems appropriate.  The Depositary may also set limits with respect to the number of ADSs and Shares involved in Pre-Release Transactions with any one person on a case by case basis as it deems appropriate.

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The Depositary may retain for its own account any compensation received by it in conjunction with the foregoing. Collateral provided pursuant to (b) above, but not the earnings thereon, shall be held for the benefit of the Holders (other than the Applicant).

(24)         Ownership Restrictions.  Owners and Beneficial Owners shall comply with any limitations on ownership of Shares under the Memorandum and Articles of Association or applicable Cayman Islands law as if they held the number of Shares their American Depositary Shares represent.  The Company shall inform the Owners, Beneficial Owners and the Depositary of any such ownership restrictions in place from time to time.

(25)         Waiver. EACH PARTY TO THE DEPOSIT AGREEMENT (INCLUDING, FOR AVOIDANCE OF DOUBT, EACH HOLDER AND BENEFICIAL OWNER AND/OR HOLDER OF INTERESTS IN THE ADRs) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING AGAINST THE DEPOSITARY AND/OR THE COMPANY DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THE SHARES OR OTHER DEPOSITED SECURITIES, THE ADSs OR THE ADRs, THE DEPOSIT AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREIN OR THEREIN, OR THE BREACH HEREOF OR THEREOF (WHETHER BASED ON CONTRACT, TORT, COMMON LAW OR ANY OTHER THEORY).

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(ASSIGNMENT AND TRANSFER SIGNATURE LINES)

FOR VALUE RECEIVED, the undersigned Holder hereby sell(s), assign(s) and transfer(s) unto ______________________________ whose taxpayer identification number is _______________________ and whose address including postal zip code is ____________________________, the within Receipt and all rights thereunder, hereby irrevocably constituting and appointing ________________________ attorney-in-fact to transfer said Receipt on the books of the Depositary with full power of substitution in the premises.

Dated:		Name:
	By:
	Title:
		NOTICE: The signature of the Holder to this assignment must correspond with the name as written upon the face of the within instrument in every particular, without alteration or enlargement or any change whatsoever.
		If the endorsement be executed by an attorney, executor, administrator, trustee or guardian, the person executing the endorsement must give his/her full title in such capacity and proper evidence of authority to act in such capacity, if not on file with the Depositary, must be forwarded with this Receipt.
SIGNATURE GUARANTEED

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ARTICLE I.	DEFINITIONS		1
	SECTION 1.1	“Affiliate”	1
	SECTION 1.2	“Agent”	1
	SECTION 1.3	“American Depositary Share(s)” and “ADS(s)”	2
	SECTION 1.4	“Article”	2
	SECTION 1.5	“Articles of Association”	2
	SECTION 1.6	“ADS Record Date”	2
	SECTION 1.7	“Beneficial Owner”	2
	SECTION 1.8	“Business Day”	2
	SECTION 1.9	“Commission”	2
	SECTION 1.10	“Company”	2
	SECTION 1.11	“Corporate Trust Office”	2
	SECTION 1.12	“Custodian”	2
	SECTION 1.13	“Deliver” and “Delivery”	3
	SECTION 1.14	“Deposit Agreement”	3
	SECTION 1.15	“Depositary”	3
	SECTION 1.16	“Deposited Securities”	3
	SECTION 1.17	“Dollars” and “$”	3
	SECTION 1.18	“DRS/Profile”	3
	SECTION 1.19	“DTC”	3
	SECTION 1.20	“Exchange Act”	3
	SECTION 1.21	“Foreign Currency”	3
	SECTION 1.22	“Foreign Registrar”	3
	SECTION 1.23	“Holder”	3
	SECTION 1.24	“Indemnified Person” and “Indemnifying Person”	4
	SECTION 1.25	“Memorandum”	4
	SECTION 1.26	“Opinion of Counsel”	4
	SECTION 1.27	“Pre-Release Transaction”	4
	SECTION 1.28	“Receipt(s); “American Depositary Receipt(s)”; and “ADR(s)”	4
	SECTION 1.29	“Registrar”	4
	SECTION 1.30	“Restricted ADRs”	4
	SECTION 1.31	“Restricted ADSs”	4
	SECTION 1.32	“Restricted Securities”	4
	SECTION 1.33	“Restricted Shares”	4
	SECTION 1.34	“Securities Act”	5
	SECTION 1.35	“Shares”	5
	SECTION 1.36	“United States” or “U.S.”	5
ARTICLE II.	APPOINTMENT OF DEPOSITARY; FORM OF RECEIPT; DEPOSIT OF SHARES; EXECUTION AND DELIVERY, TRANSFER AND SURRENDER OF RECEIPTS		5
	SECTION 2.1	Appointment of Depositary	5
	SECTION 2.2	Form and Transferability of Receipts	5
	SECTION 2.3	Deposits	7
	SECTION 2.4	Execution and Delivery of Receipts	8
	SECTION 2.5	Transfer of Receipts; Combination and Split-up of Receipts	9
	SECTION 2.6	Surrender of Receipts and Withdrawal of Deposited Securities	9

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	SECTION 2.7	Limitations on Execution and Delivery, Transfer, etc. of Receipts; Suspension of Delivery, Transfer, etc.	10
	SECTION 2.8	Lost Receipts, etc.	11
	SECTION 2.9	Cancellation and Destruction of Surrendered Receipts; Maintenance of Records	11
	SECTION 2.10	Pre-Release	11
	SECTION 2.11	Restricted ADSs	12
	SECTION 2.12	Maintenance of Records	13
ARTICLE III.	CERTAIN OBLIGATIONS OF HOLDERS AND BENEFICIAL OWNERS OF RECEIPTS		13
	SECTION 3.1	Proofs, Certificates and Other Information	13
	SECTION 3.2	Liability for Taxes and Other Charges	14
	SECTION 3.3	Representations and Warranties on Deposit of Shares	14
	SECTION 3.4	Compliance with Information Requests	15
ARTICLE IV	THE DEPOSITED SECURITIES.		15
	SECTION 4.1	Cash Distributions	15
	SECTION 4.2	Distribution in Shares	16
	SECTION 4.3	Elective Distributions in Cash or Shares	17
	SECTION 4.4	Distribution of Rights to Purchase Shares	17
	SECTION 4.5	Distributions Other Than Cash, Shares or Rights to Purchase Shares	19
	SECTION 4.6	Conversion of Foreign Currency	19
	SECTION 4.7	Fixing of Record Date	20
	SECTION 4.8	Voting of Deposited Securities	21
	SECTION 4.9	Changes Affecting Deposited Securities	22
	SECTION 4.10	Available Information	23
	SECTION 4.11	Reports	23
	SECTION 4.12	List of Holders	23
	SECTION 4.13	Taxation; Withholding	23
ARTICLE V.	THE DEPOSITARY, THE CUSTODIAN AND THE COMPANY		24
	SECTION 5.1	Maintenance of Office and Transfer Books by the Registrar	24
	SECTION 5.2	Exoneration	25
	SECTION 5.3	Standard of Care	26
	SECTION 5.4	Resignation and Removal of the Depositary; Appointment of Successor Depositary	27
	SECTION 5.5	The Custodian	28
	SECTION 5.6	Notices and Reports	28
	SECTION 5.7	Issuance of Additional Shares, ADSs etc.	29
	SECTION 5.8	Indemnification	30
	SECTION 5.9	Fees and Charges of Depositary	31
	SECTION 5.10	Restricted Securities Owners/Ownership Restrictions	32
ARTICLE VI.	AMENDMENT AND TERMINATION		33
	SECTION 6.1	Amendment/Supplement	33
	SECTION 6.2	Termination	33
ARTICLE VII.	MISCELLANEOUS		34
	SECTION 7.1	Counterparts	34
	SECTION 7.2	No Third-Party Beneficiaries	34

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	SECTION 7.3	Severability	35
	SECTION 7.4	Holders and Beneficial Owners as Parties; Binding Effect	35
	SECTION 7.5	Notices	35
	SECTION 7.6	Governing Law and Jurisdiction	36
	SECTION 7.7	Assignment	37
	SECTION 7.8	Agents	37
	SECTION 7.9	Exclusivity	37
	SECTION 7.10	Compliance with U.S. Securities Laws	37
	SECTION 7.11	Titles	37
EXHIBIT A			39
EXHIBIT B			47

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EX-4.4

Exhibit 4.4

THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED, OR BE THE SUBJECT OF ANY HEDGING, SHORT SALE, DERIVATIVE, PUT, OR CALL TRANSACTION THAT WOULD RESULT IN THE EFFECTIVE ECONOMIC DISPOSITION OF SUCH SECURITIES BY ANY PERSON FOR A PERIOD OF SIX (6) MONTHS IMMEDIATELY FOLLOWING THE DATE OF EFFECTIVENESS OF THE PUBLIC OFFERING OF THE COMPANY’S SECURITIES PURSUANT TO REGISTRATION STATEMENT NO.: _______________ AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, EXCEPT IN ACCORDANCE WITH FINRA RULE 5110(G)(2).

GRAND FARM, INC

UNDERWRITER’S WARRANT

[_________] Ordinary Shares in the form of American Depositary Shares

__________ ___, 2011

This UNDERWRITER’S WARRANT (this “Warrant”) of Grand Farm, Inc., a corporation duly organized and validly existing under the laws of the Cayman Islands (the “Company”), is being issued pursuant to that certain Underwriting Agreement, dated as of _________ __, 2011 (the “Underwriting Agreement”), by and between the Company and Newbridge Securities Corporation (the “Underwriter”) relating to a firm commitment public offering (the “Offering”) of __________ ordinary shares, par value $.002 per share (“Ordinary Shares”) in the form of ______________ American Depositary Shares, each representing ___ Ordinary Share(s) (“ADSs”) underwritten by the Underwriter named in the Underwriting Agreement.

FOR VALUE RECEIVED, the Company hereby grants the Underwriter and its permitted successors and assigns (collectively, the “Holder”) the right to purchase from the Company up to ________________ (______) Ordinary Shares in the form of _________ (___) ADSs, with each ADS representing ___ Ordinary Share(s) (such Ordinary Shares in the form of ADSs underlying this Warrant shall be referred to herein as, the “Warrant Shares”), at a purchase price equal to $______ per Ordinary Share (the “Exercise Price”), subject to the terms, conditions and adjustments set forth below in this Warrant.

1.           Date of Warrant Exercise.  This Warrant shall become exercisable on the date that is six (6) months from the Base Date (the “Exercise Date”).  As used in this Warrant, the term “Base Date” shall mean ________ __, 2011, which is the effective date of the Registration Statement on Form F-1 (File No. 333-_____________).  Except as otherwise provided for herein or as permitted by applicable rules of the Financial Industry Regulatory Authority, Inc., this Warrant shall not be sold, transferred, assigned, pledged or hypothecated prior to the Exercise Date.

2.           Expiration of Warrant.  This Warrant shall expire on the fifth year anniversary of the Base Date (the “Expiration Date”).

3.           Exercise of Warrant.  This Warrant shall be exercisable pursuant to the terms of this Section 3.

3.1           Manner of Exercise.

(a)           This Warrant may only be exercised by the Holder hereof on or after the Exercise Date and on or prior to the Expiration Date, in accordance with the terms and conditions hereof, in whole or in part (but not as to fractional shares) with respect to any portion of this Warrant, during the Company’s normal business hours on any day other than a Saturday or a Sunday or a day on which commercial banking institutions in New York, New York are authorized by law to be closed (a “Business Day”), by surrender of this Warrant to the Company at its office maintained pursuant to Section 10.2(a) hereof, accompanied by a written exercise notice in the form attached as Exhibit A to this Warrant (or a reasonable facsimile thereof) duly executed by the Holder, together with the payment of the aggregate Exercise Price for the number of Warrant Shares purchased upon exercise of this Warrant.  Upon surrender of this Warrant, the Company shall cancel this Warrant document and shall, in the event of partial exercise, replace it with a new Warrant document in accordance with Section 3.3.

(b)           Each exercise of this Warrant must be accompanied by payment in full of the aggregate Exercise Price in cash by check or wire transfer in immediately available funds for the number of Warrant Shares being purchased by the Holder upon such exercise except in the cash of a cashless exercise as set forth in Section 3.2 below.

3.2           Cashless Exercise  In lieu of the payment of the Exercise Price multiplied by the number of Warrant Shares for which this Warrant is exercisable in the manner required by Section 3.1, the Holder shall have the right to convert any exercisable but unexercised portion of this Warrant into Warrant Shares (“Conversion Right”) as follows:  upon exercise of the Conversion Right, the Company shall deliver to the Holder (without payment by the Holder of any of the Exercise Price in cash) that number of Warrant Shares equal to the quotient obtained by dividing (x) the “Value” (as defined below) of the portion of this Warrant being converted by (y) the Current Market Price per Ordinary Share in the form of ADSs (as defined below). The “Value” of the portion of this Warrant being converted shall equal the remainder derived from subtracting (a) (i) the Exercise Price multiplied by (ii) the number of Warrant Shares underlying the portion of this Warrant being converted from (b) the Current Market Price of an Ordinary Share in the form of ADSs  multiplied by the number of Warrant Shares underlying the portion of the Warrant being converted. As used herein, the term “Current Market Price” per Ordinary Share in the form of ADSs at any date shall mean (i) if the Ordinary Shares in the form of ADSs are listed on a national securities exchange or quoted on the Nasdaq Global Market, Nasdaq Capital Market or NASD OTC Bulletin Board (or successor exchange), the last sale price of the Ordinary Shares in the form of ADSs in the principal trading market for the Ordinary Shares in the form of ADSs as reported by the exchange, Nasdaq or the NASD, as the case may be, on the last trading day preceding the date in question; (ii) if the Ordinary Shares in the form of ADSs are not listed on a national securities exchange or quoted on the Nasdaq Global Market, Nasdaq Capital Market or the NASD OTC Bulletin Board (or successor exchange), but is traded in the residual over-the-counter market, the closing bid price for the Ordinary Shares in the form of ADSs on the last trading day preceding the date in question for which such quotations are reported by the Pink Sheets, LLC or similar publisher of such quotations; and (iii) if the fair market value of the Ordinary Shares in the form of ADSs cannot be determined pursuant to clause (i) or (ii) above, such price as the Board of Directors of the Company shall determine, in good faith.

3.3           When Exercise Effective.  Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the Business Day on which this Warrant shall have been duly surrendered to the Company as provided in Sections 3.1 and 12 hereof, and, at such time, the Holder in whose name any certificate or certificates for Warrant Shares shall be issuable upon exercise as provided in Section 3.3 hereof shall be deemed to have become the holder or holders of record thereof of the number of Warrant Shares purchased upon exercise of this Warrant.

3.4           Delivery of Warrant Shares and New Warrant.  As soon as reasonably practicable after each exercise of this Warrant, in whole or in part, and in any event within five (5) Business Days thereafter, the Company, at its expense (including the payment by it of any applicable issue taxes), will cause to be issued in the name of and delivered to the Holder hereof or, subject to Sections 9 and 10 hereof, as the Holder (upon payment by the Holder of any applicable transfer taxes) may direct:

(a)           a certificate or certificates (with appropriate restrictive legends, as applicable) for the number of duly authorized, validly issued, fully paid and nonassessable Warrant Shares to which the Holder shall be entitled upon exercise; and

(b)           in case exercise is in part only, a new Warrant document of like tenor, dated the date hereof, for the remaining number of Warrant Shares issuable upon exercise of this Warrant after giving effect to the partial exercise of this Warrant (including the delivery of any Warrant Shares as payment of the Exercise Price for such partial exercise of this Warrant).

4.           Certain Adjustments.  For so long as this Warrant is outstanding:

4.1           Mergers or Consolidations.  If at any time after the date hereof there shall be a capital reorganization (other than a combination or subdivision of Ordinary Shares otherwise provided for herein) resulting in a reclassification to or change in the terms of securities issuable upon exercise of this Warrant (a “Reorganization”), or a merger or consolidation of the Company with another corporation, association, partnership, organization, business, individual, government or political subdivision thereof or a governmental agency (a “Person” or the “Persons”) (other than a merger with another Person in which the Company is a continuing corporation and which does not result in any reclassification or change in the terms of securities issuable upon exercise of this Warrant or a merger effected exclusively for the purpose of changing the domicile of the Company) (a “Merger”), then, as a part of such Reorganization or Merger, lawful provision and adjustment shall be made so that the Holder shall thereafter be entitled to receive, upon exercise of this Warrant, the number of shares of stock or any other equity or debt securities or property receivable upon such Reorganization or Merger by a holder of the number of Ordinary Shares which might have been purchased upon exercise of this Warrant immediately prior to such Reorganization or Merger.  In any such case, appropriate adjustment shall be made in the application of the provisions of this Warrant with respect to the rights and interests of the Holder after the Reorganization or Merger to the end that the provisions of this Warrant (including adjustment of the Exercise Price then in effect and the number of Warrant Shares) shall be applicable after that event, as near as reasonably may be, in relation to any shares of stock, securities, property or other assets thereafter deliverable upon exercise of this Warrant.  The provisions of this Section 4.1 shall similarly apply to successive Reorganizations and/or Mergers.

4.2           Splits and Subdivisions; Dividends.  In the event the Company should at any time or from time to time effectuate a split or subdivision of the outstanding Ordinary Shares or pay a dividend in or make a distribution payable in additional Ordinary Shares or securities convertible into or exchangeable for Ordinary Shares (“Ordinary Share Equivalents”) without payment of any consideration by such holder for the additional Ordinary Shares or Ordinary Share Equivalents (including the additional Ordinary Shares issuable upon conversion or exercise thereof), then, as of the applicable record date (or the date of such distribution, split or subdivision if no record date is fixed), the per share Exercise Price shall be appropriately decreased and the number of Warrant Shares shall be appropriately increased in proportion to such increase (or potential increase) of outstanding shares; provided, however, that no adjustment shall be made in the event the split, subdivision, dividend or distribution is not effectuated.

4.3           Combination of Shares.  If the number of Ordinary Shares outstanding at any time after the date hereof is decreased by a combination of the outstanding Ordinary Shares, the per share Exercise Price shall be appropriately increased and the number of shares of Warrant Shares shall be appropriately decreased in proportion to such decrease in outstanding shares.

4.4           Adjustments for Other Distributions.  In the event the Company shall declare a distribution payable in securities of other Persons, evidences of indebtedness issued by the Company or other Persons, assets (excluding cash dividends or distributions to the holders of Ordinary Shares paid out of current or retained earnings and declared by the Company’s board of directors) or options or rights not referred to in Sections 4.2, 4.3 or 4.4, then, in each such case for the purpose of this Section 4.5, upon exercise of this Warrant, the Holder shall be entitled to a proportionate share of any such distribution as though the Holder was the actual record holder of the number of Warrant Shares as of the record date fixed for the determination of the holders of Ordinary Shares of the Company entitled to receive such distribution.

5.           No Impairment.  The Company will not, by amendment of its articles of association or through any consolidation, merger, reorganization, transfer of assets, 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 of this Warrant, but will at all times in good faith assist in the carrying out of all of the terms and in the taking of all actions necessary or appropriate in order to protect the rights of the Holder against impairment.

6.           Chief Financial Officer’s Report as to Adjustments.  With respect to each adjustment pursuant to Section 4 of this Warrant, the Company, at its expense, will promptly compute the adjustment or re-adjustment in accordance with the terms of this Warrant and cause its Chief Financial Officer to certify the computation (other than any computation of the fair value of property of the Company, as the case may be) and prepare a report setting forth, in reasonable detail, the event requiring the adjustment or re-adjustment and the amount of such adjustment or re-adjustment, the method of calculation thereof and the facts upon which the adjustment or re-adjustment is based, and the Exercise Price and the number of Warrant Shares or other securities purchasable hereunder after giving effect to such adjustment or re-adjustment,  which report shall be mailed by first class mail, postage prepaid to the Holder.  The Company will also keep copies of all reports at its office maintained pursuant to Section 10.2(a) hereof and will cause them to be available for inspection at the office during normal business hours upon reasonable notice by the Holder or any prospective purchaser of the Warrant designated by the Holder thereof.

7.           Reservation of Shares.  The Company shall, solely for the purpose of effecting the exercise of this Warrant, at all times during the term of this Warrant, reserve and keep available out of its authorized Ordinary Shares, free from all taxes, liens and charges with respect to the issue thereof and not subject to preemptive rights or other similar rights of shareholders of the Company, such number of its Ordinary Shares as shall from time to time be sufficient to effect in full the exercise of this Warrant.  If at any time the number of authorized but unissued Ordinary Shares shall not be sufficient to effect in full the exercise of this Warrant, in addition to such other remedies as shall be available to Holder, the Company will promptly take such corporate action as may, in the opinion of its counsel, be necessary to increase the number of authorized but unissued Ordinary Shares to such number of shares as shall be sufficient for such purposes, including without limitation, using its Reasonable Best Efforts (as defined in Section 14 hereof) to obtain the requisite shareholder approval necessary to increase the number of authorized Ordinary Shares.  The Company hereby represents and warrants that all Ordinary Shares issuable upon exercise of this Warrant shall be duly authorized and, when issued and paid for upon exercise, shall be validly issued, fully paid and nonassessable.

8.           Registration and Listing.

8.1           Definition of Registrable Securities; Majority.  As used herein, the term “Registrable Securities” means any Ordinary Shares issuable upon the exercise of this Warrant, until the date (if any) on which such shares shall have been transferred or exchanged and new certificates for them not bearing a legend restricting further transfer shall have been delivered by the Company and subsequent disposition of them shall not require registration or qualification of them under the Securities Act or any similar state law then in force.  For purposes of this Warrant, the term “Majority”, in reference to the holders of Registrable Securities, shall mean in excess of fifty percent (50%) of the then outstanding Warrant Shares (assuming the exercise of the entire Warrant) that: (i) are not held by the Company, an affiliate, officer, creditor, employee or agent thereof or any of their respective affiliates, members of their family, Persons acting as nominees or in conjunction therewith and (ii) have not been resold to the public pursuant to a registration statement filed under the Securities Act.

8.2           Demand Registration.

(a)           Request for Registration. At any time on or after the Base Date and on or before the Expiration Date, the holders of not less than a Majority of the Registrable Securities may make a written demand for registration under the Securities Act of all or part of their Registrable Securities (a “Demand Registration”). Such demand for a Demand Registration shall specify the number of shares of Registrable Securities proposed to be sold and the intended method(s) of distribution thereof. The Company will notify all holders of Registrable Securities of the demand within ten (10) days from the receipt of the Demand Registration, and each holder of Registrable Securities who wishes to include all or a portion of such holder’s Registrable Securities in the Demand Registration (each such holder including shares of Registrable Securities in such registration, a “Demanding Holder”) shall so notify the Company within fifteen (15) days after the receipt by the holder of the notice from the Company. Upon any such request, the Demanding Holders shall be entitled to have their Registrable Securities included in the Demand Registration, subject to Section 8.2(d) and the provisos set forth in Section 8.4. The Company shall not be obligated to effect more than one (1) Demand Registrations under this Section 8.2 in respect of Registrable Securities.

(b)           Effective Registration. A registration will not count as a Demand Registration until the Registration Statement filed with the Commission with respect to such Demand Registration has been declared effective and the Company has complied with all of its obligations under this Warrant with respect thereto; provided, however, that if, after such Registration Statement has been declared effective, the offering of Registrable Securities pursuant to a Demand Registration is interfered with by any stop order or injunction of the Commission or any other governmental agency or court, the Registration Statement with respect to such Demand Registration will be deemed not to have been declared effective, unless and until, (i) such stop order or injunction is removed, rescinded or otherwise terminated, and (ii) a Majority of the Demanding Holders thereafter elect to continue the offering; provided, further, that the Company shall not be obligated to file a second Registration Statement until a Registration Statement that has been filed is counted as a Demand Registration or is terminated or withdrawn.

(c)           Underwritten Offering. If not less than a Majority of the Demanding Holders so elect and such holders so advise the Company as part of their written demand for a Demand Registration, the offering of such Registrable Securities pursuant to such Demand Registration shall be in the form of an underwritten offering. In such event, the right of any holder to include its Registrable Securities in such registration shall be conditioned upon such holder’s participation in such underwriting and the inclusion of such holder’s Registrable Securities in the underwriting to the extent provided herein. All Demanding Holders proposing to distribute their securities through such underwriting shall enter into an underwriting agreement in customary form with the Underwriter or Underwriters selected for such underwriting by a Majority of the holders initiating the Demand Registration.

(d)           Reduction of Offering. If the managing Underwriter or Underwriters for a Demand Registration that is to be an underwritten offering advises the Company and the Demanding Holders in writing that the dollar amount or number of shares of Registrable Securities which the Demanding Holders desire to sell, taken together with all other Ordinary Shares, ADSs or other securities which the Company desires to issue and the Ordinary Shares and/or ADSs, if any, as to which registration has been requested pursuant to written contractual piggy-back registration rights held by other shareholders of the Company who desire to sell, exceeds the maximum dollar amount or maximum number of shares that can be sold in such offering without adversely affecting the proposed offering price, the timing, the distribution method, or the probability of success of such offering (such maximum dollar amount or maximum number of shares, as applicable, the “Maximum Number of Shares”), then the Company shall include in such registration: (i) first, the Registrable Securities as to which Demand Registration has been requested by the Demanding Holders (pro rata in accordance with the number of shares of Registrable Securities which such Demanding Holder has requested be included in such registration, regardless of the number of shares of Registrable Securities held by each Demanding Holder) that can be sold without exceeding the Maximum Number of Shares; (ii) second, to the extent that the Maximum Number of Shares has not been reached under the foregoing clause (i), ADSs or other securities for the account of other persons that the Company is obligated to register pursuant to written contractual arrangements with such persons and that can be sold without exceeding the Maximum Number of Shares the Ordinary Shares; (iii) third, to the extent that the Maximum Number of Shares has not been reached under the foregoing clauses (i) and (ii), the Ordinary Shares, ADSs or other securities that the Company desires to sell that can be sold without exceeding the Maximum Number of Shares; and (iv) fourth, to the extent that the Maximum Number of Shares have not been reached under the foregoing clauses (i), (ii), and (iii), the Ordinary Shares, ADSs or other securities that other shareholders desire to sell that can be sold without exceeding the Maximum Number of Shares.

(e)           Withdrawal. If a Majority of the Demanding Holders disapprove of the terms of any underwriting or are not entitled to include all of their Registrable Securities in any offering, such Majority of the Demanding Holders may elect to withdraw from such offering by giving written notice to the Company and the Underwriter or Underwriters of their request to withdraw prior to the effectiveness of the Registration Statement filed with the Commission with respect to such Demand Registration. If the Majority of the Demanding Holders withdraws from a proposed offering relating to a Demand Registration, then such registration shall not count as a Demand Registration provided for in this Section 8.2.

8.3           Incidental Registration Rights.

(a)           If the Company, at any time on or after the Base Date and on or before the Expiration Date, proposes to register any of its securities under the Securities Act (other than in connection with a registration on Form S-4 or S-8 or any successor forms) whether for its own account or for the account of any holder or holders of its shares other than Registrable Securities (any shares of such holder or holders (but not those of the Company and not Registrable Securities) with respect to any registration are referred to herein as, “Other Shares”), the Company shall each such time give prompt (but not less than thirty (30) days prior to the anticipated effectiveness thereof) written notice to the holders of Registrable Securities of its intention to do so.  Upon the written request of any such holder of Registrable Securities made within ten (10) days after the receipt of any such notice (which request shall specify the Registrable Securities intended to be disposed of by such holder), except as set forth in Section 8.3(b), the Company will use its Reasonable Best Efforts to effect the registration under the Securities Act of all of the Registrable Securities which the Company has been so requested to register by such holder, to the extent requisite to permit the disposition of the Registrable Securities so to be registered, by inclusion of such Registrable Securities in the registration statement which covers the securities which the Company proposes to register; provided, however, that if, at any time after giving written notice of its intention to register any securities and prior to the effective date of the registration statement filed in connection with such registration, the Company shall determine for any reason in its sole discretion either to not register, to delay or to withdraw registration of such securities, the Company may, at its election, give written notice of such determination to such holder and, thereupon: (i) in the case of a determination not to register, shall be relieved of its obligation to register any Registrable Securities in connection with such registration (but not from its obligation to pay the Registration Expenses in connection therewith), (ii) in the case of a determination to delay registration, shall be permitted to delay registering any Registrable Securities for the same period as the delay in registering such other securities (including the Other Shares), and (iii) in the case of a determination to withdraw registration, shall be permitted to withdraw registration,  The Company will pay all Registration Expenses in connection with each registration of Registrable Securities pursuant to this Section 8.3.

(b)           If the Company at any time proposes to register any of its securities under the Securities Act as contemplated by this Section 8.3 and such securities are to be distributed by or through one or more underwriters, the Company will, if requested by a holder of Registrable Securities, use its Reasonable Best Efforts to arrange for such underwriters to include all the Registrable Securities to be offered and sold by such holder among the securities to be distributed by such underwriters, provided that if the managing underwriter of such underwritten offering shall inform the Company by letter of its belief that inclusion in such distribution of all or a specified number of such securities proposed to be distributed by such underwriters would interfere with the successful marketing of the securities being distributed by such underwriters (such letter to state the basis of such belief and the approximate number of such Registrable Securities, such Other Shares and shares held by the Company proposed so to be registered which may be distributed without such effect), then the Company may, upon written notice to such holder, the other holders of Registrable Securities, and holders of such Other Shares, reduce pro rata in accordance with the number of Ordinary Shares desired to be included in such registration (if and to the extent stated by such managing underwriter to be necessary to eliminate such effect) the number of such Registrable Securities and Other Shares the registration of which shall have been requested by each holder thereof so that the resulting aggregate number of such Registrable Securities and Other Shares so included in such registration, together with the number of securities to be included in such registration for the account of the Company, shall be equal to the number of shares stated in such managing underwriter’s letter.

8.4           Registration Procedures.  Whenever the holders of Registrable Securities have properly requested that any Registrable Securities be registered pursuant to the terms of this Warrant, the Company shall use its Reasonable Best Efforts to effect the registration and the sale of such Registrable Securities in accordance with the intended method of disposition thereof, and pursuant thereto the Company shall as expeditiously as possible:

(a)           prepare and file with the SEC a registration statement with respect to such Registrable Securities and use its Reasonable Best Efforts to cause such registration statement to become effective;

(b)           notify such holders of the effectiveness of each registration statement filed hereunder and prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to (i) keep such registration statement effective and the prospectus included therein usable for a period commencing on the date that such registration statement is initially declared effective by the SEC and ending on the date when all Registrable Securities covered by such registration statement have been sold pursuant to the registration statement or cease to be Registrable Securities, and (ii) comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement during such period in accordance with the intended methods of disposition by the sellers thereof set forth in such registration statement;

(c)           furnish to such holders such number of copies of such registration statement, each amendment and supplement thereto, the prospectus included in such registration statement (including each preliminary prospectus) and such other documents as such seller may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such holders;

(d)           use its Reasonable Best Efforts to register or qualify such Registrable Securities under such other securities or blue sky laws of such jurisdictions as such holders reasonably request and do any and all other acts and things which may be reasonably necessary or advisable to enable such holders to consummate the disposition in such jurisdictions of the Registrable Securities owned by such holders; provided, however, that the Company shall not be required to: (i) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subparagraph; (ii) subject itself to taxation in any such jurisdiction; or (iii) consent to general service of process in any such jurisdiction;

(e)           notify such holders, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of the happening of any event as a result of which the prospectus included in such registration statement contains an untrue statement of a material fact or omits any material fact necessary to make the statements therein, in light of the circumstances in which they are made, not materially misleading, and, at the reasonable request of such holders, the Company shall prepare a supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of such Registrable Securities, such prospectus shall not contain an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances in which they are made, not materially misleading;

(f)           provide a transfer agent and registrar or depositary, as applicable, for all such Registrable Securities not later than the effective date of such registration statement;

(g)           make available for inspection by any underwriter participating in any disposition pursuant to such registration statement, and any attorney, accountant or other agent retained by any such underwriter, all financial and other records, pertinent corporate documents and properties of the Company, and cause the Company’s officers, directors, managers, employees and independent accountants to supply all information reasonably requested by any such underwriter, attorney, accountant or agent in connection with such registration statement;

(h)           otherwise use its Reasonable Best Efforts to comply with all applicable rules and regulations of the SEC, and make available to its security holders, as soon as reasonably practicable, an earnings statement of the Company, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and, at the option of the Company, Rule 158 thereunder;

(i)           in the event of the issuance of any stop order suspending the effectiveness of a registration statement, or of any order suspending or preventing the use of any related prospectus or suspending the qualification of any Registrable Securities included in such registration statement for sale in any jurisdiction, the Company shall use its Reasonable Best Efforts promptly to obtain the withdrawal of such order;

(j)           use its Reasonable Best Efforts to cause any Registrable Securities covered by such registration statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the sellers thereof to consummate the disposition of such Registrable Securities; and

(k)           if the offering is underwritten, use its Reasonable Best Efforts to furnish on the date that Registrable Securities are delivered to the underwriters for sale pursuant to such registration, an opinion dated such date of counsel representing the Company for the purposes of such registration, addressed to the underwriters covering such issues as are reasonably required by such underwriters.

8.5           Listing.  The Company shall secure the listing of the Ordinary Shares in the form of ADSs underlying this Warrant upon each national securities exchange or automated quotation system upon which Ordinary Shares in the form of ADSs are then listed or quoted (subject to official notice of issuance) and shall maintain such listing of Ordinary Shares in the form of ADSs.  The Company shall at all times comply in all material respects with the Company’s reporting, filing and other obligations under the by-laws or rules of the Nasdaq Stock Market (or such other national securities exchange or market on which the Ordinary Shares in the form of ADSs may then be listed, as applicable).

8.6           Expenses.  The Company shall pay all Registration Expenses relating to the registration and listing obligations set forth in this Section 8.  For purposes of this Warrant, the term “Registration Expenses” means: (a) all registration, filing and FINRA (as defined below) fees, (b) all reasonable fees and expenses of complying with securities or blue sky laws, (c) all word processing, duplicating and printing expenses, (d) the fees and disbursements of counsel for the Company and of its independent public accountants, including the expenses of any special audits or “cold comfort” letters required by or incident to such performance and compliance, (e) premiums and other costs of policies of insurance (if any) against liabilities arising out of the public offering of the Registrable Securities being registered if the Company desires such insurance, if any, and (f) fees and disbursements of one counsel for the selling holders of Registrable Securities up to a maximum of $10,000; provided however, that, in any case where Registration Expenses are not to be borne by the Company, such expenses shall not include (and such expenses shall be borne by the Company): (i) salaries of Company personnel or general overhead expenses of the Company, (ii) auditing fees, (iii) premiums or other expenses relating to liability insurance required by underwriters of the Company, or (iv) other expenses for the preparation of financial statements or other data, to the extent that any of the foregoing either is normally prepared by the Company in the ordinary course of its business or would have been incurred by the Company had no public offering taken place.  Registration Expenses shall not include any underwriting discounts and commissions which may be incurred in the sale of any Registrable Securities and transfer taxes of the selling holders of Registrable Securities.

8.7           Information Provided by Holders.  Any holder of Registrable Securities included in any registration shall furnish to the Company such information as the Company may reasonably request in writing to enable the Company to comply with the provisions hereof in connection with any registration referred to in this Warrant.

8.8           FINRA Cobradesk Filings.  In the event that a registration statement covering the Registrable Securities is filed, within one (1) Business Day of the filing of such registration statement, the Company will prepare and file the selling stockholder resale offering described in such registration statement for review by the Financial Industry Regulatory Authority (“FINRA”) via the FINRA’s CobraDesk filing system (“CobraDesk Filing”) for the purpose of having the prospectus contained within such registration statement treated as a “base prospectus” in connection with such resale offering.  The Company will use its Reasonable Best Efforts to have the CobraDesk Filing approved by FINRA within thirty (30) days of such filing date.  The Company shall bear all expenses of the CobraDesk Filing, including fees and expenses of counsel or other advisors to the Holder.  In all circumstances, the Company shall pay for all FINRA filing fees associated with the CobraDesk Filing.

8.9           Effectiveness Period.  The Company shall use its Reasonable Best Efforts to keep each registration statement contemplated hereunder continuously effective under the Securities Act until the date which is the earlier date of when (i) all Registrable Securities covered by such Registration Statement have been sold or (ii) all Registrable Securities covered by such Registration Statement may be sold immediately without registration under the Securities Act and without volume restrictions pursuant to Rule 144 under the Securities Act, as determined by the counsel to the Company pursuant to a written opinion letter to such effect, addressed and reasonably acceptable to the Company’s transfer agent and the affected holders of Registrable Securities.

8.10           Net Cash Settlement.  Notwithstanding anything herein to the contrary, in no event will the Holder hereof be entitled to receive a net-cash settlement as liquidated damages in lieu of physical settlement in Ordinary Shares or ADSs, regardless of whether the Ordinary Shares or ADS underlying this Warrant are registered pursuant to an effective registration statement; provided, however, that the foregoing will not preclude the Holder from seeking other remedies at law or equity for breaches by the Company of its registration obligations hereunder.

9.           Restrictions on Transfer.

9.1           Restrictive Legends.  This Warrant and each Warrant issued upon transfer or in substitution for this Warrant pursuant to Section 10 hereof, each certificate for Ordinary Shares in the form of ADSs issued upon the exercise of the Warrant and each certificate issued upon the transfer of any such Ordinary Shares in the form of ADSs shall be transferable only upon satisfaction of the conditions specified in this Section 9.  Each of the foregoing securities shall be stamped or otherwise imprinted with a legend reflecting the restrictions on transfer set forth herein and any restrictions required under the Securities Act or other applicable securities laws.

9.2           Notice of Proposed Transfer.  Prior to any transfer of any securities which are not registered under an effective registration statement under the Securities Act (“Restricted Securities”), which transfer may only occur if there is an exemption from the registration provisions of the Securities Act and all other applicable securities laws, the Holder will give written notice to the Company of the Holder’s intention to effect a transfer (and shall describe the manner and circumstances of the proposed transfer). The following provisions shall apply to any proposed transfer of Restricted Securities:

(i)           If in the opinion of counsel for the Holder reasonably satisfactory to the Company the proposed transfer may be effected without registration of the Restricted Securities under the Securities Act (which opinion shall state in detail the basis of the legal conclusions reached therein), the Holder shall thereupon be entitled to transfer the Restricted Securities in accordance with the terms of the notice delivered by the Holder to the Company.  Each certificate representing the Restricted Securities issued upon or in connection with any transfer shall bear the restrictive legends required by Section 9.1 hereof.

(ii)           If the opinion called for in (i) above is not delivered, the Holder shall not be entitled to transfer the Restricted Securities until either: (x) receipt by the Company of a further notice from such Holder pursuant to the foregoing provisions of this Section 9.2 and fulfillment of the provisions of clause (i) above, or (y) such Restricted Securities have been effectively registered under the Securities Act.

9.3           Certain Other Transfer Restrictions.  Notwithstanding any other provision of this Section 9: (i) prior to the Exercise Date, this Warrant or the Restricted Securities thereunder may only be transferred or assigned to the persons permitted under FINRA Rule 5110(g), and (ii) no opinion of counsel shall be necessary for a transfer of Restricted Securities by the holder thereof to any Person employed by or owning equity in the Holder, if the transferee agrees in writing to be subject to the terms hereof to the same extent as if the transferee were the original purchaser hereof and such transfer is permitted under applicable securities laws.

9.4           Termination of Restrictions.  Except as set forth in Section 9.3 hereof, the restrictions imposed by this Section 9 upon the transferability of Restricted Securities shall cease and terminate as to any particular Restricted Securities: (a) which shall have been effectively registered under the Securities Act, or (b) when, in the opinions of both counsel for the holder thereof and counsel for the Company, such restrictions are no longer required in order to insure compliance with the Securities Act or Section 10 hereof.  Whenever such restrictions shall cease and terminate as to any Restricted Securities, the Holder thereof shall be entitled to receive from the Company, without expense (other than applicable transfer taxes, if any), new securities of like tenor not bearing the applicable legends required by Section 9.1 hereof.

10.           Ownership, Transfer, Sale and Substitution of Warrant.

10.1           Ownership of Warrant.  The Company may treat any Person in whose name this Warrant is registered in the Warrant Register maintained pursuant to Section 10.2(b) hereof as the owner and holder thereof for all purposes, notwithstanding any notice to the contrary, except that, if and when any Warrant is properly assigned in blank, the Company may (but shall not be obligated to) treat the bearer thereof as the owner of such Warrant for all purposes, notwithstanding any notice to the contrary.  Subject to Sections 9 and 10 hereof, this Warrant, if properly assigned, may be exercised by a new holder without a new Warrant first having been issued.

10.2           Office; Exchange of Warrant.

(a)           The Company will maintain its principal office at the location identified in the prospectus relating to the Offering or at such other offices as set forth in the Company’s most current filing (as of the date notice is to be given) under the Exchange Act or as the Company otherwise notifies the Holder.

(b)           The Company shall cause to be kept at its office maintained pursuant to Section 10.2(a) hereof a Warrant Register for the registration and transfer of the Warrant.  The name and address of the holder of the Warrant, the transfers thereof and the name and address of the transferee of the Warrant shall be registered in such Warrant Register.  The Person in whose name the Warrant shall be so registered shall be deemed and treated as the owner and holder thereof for all purposes of this Warrant, and the Company shall not be affected by any notice or knowledge to the contrary.

(c)           Upon the surrender of this Warrant, properly endorsed, for registration of transfer or for exchange at the office of the Company maintained pursuant to Section 10.2(a) hereof, the Company at its expense will (subject to compliance with Section 9 hereof, if applicable) execute and deliver to or upon the order of the Holder thereof a new Warrant of like tenor, in the name of such holder or as such holder (upon payment by such holder of any applicable transfer taxes) may direct, calling in the aggregate on the face thereof for the number of Ordinary Shares called for on the face of the Warrant so surrendered (after giving effect to any previous adjustment(s) to the number of Warrant Shares).

10.3           Replacement of Warrant.  Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction of this Warrant, upon delivery of indemnity reasonably satisfactory to the Company in form and amount or, in the case of any mutilation, upon surrender of this Warrant for cancellation at the office of the Company maintained pursuant to Section 10.2(a) hereof, the Company, at its expense, will execute and deliver, in lieu thereof, a new Warrant of like tenor and dated the date hereof.

10.4           Opinions.  In connection with the sale of the Warrant Shares by Holder, the Company agrees to cooperate with the Holder, and at the Company’s expense, have its counsel provide any legal opinions required to remove the restrictive legends from the Warrant Shares in connection with a sale, transfer or legend removal request of Holder.

11.           No Rights or Liabilities as Stockholder.  No Holder shall be entitled to vote or receive dividends or be deemed the holder of any Ordinary Shares or any other securities of the Company which may at any time be issuable on the exercise hereof for any purpose, nor shall anything contained herein be construed to confer upon the Holder, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action (whether upon any recapitalization, issuance of stock, reclassification of stock, change of par value, consolidation, merger, conveyance, or otherwise) or to receive notice of meetings, or to receive dividends or subscription rights or otherwise until the Warrant shall have been exercised and the Ordinary Shares purchasable upon the exercise hereof shall have become deliverable, as provided herein.  The Holder will not be entitled to share in the assets of the Company in the event of a liquidation, dissolution or the winding up of the Company.

12.           Notices.  Any notice or other communication in connection with this Warrant shall be given in writing and directed to the parties hereto as follows: (a) if to the Holder, c/o David Wong, Newbridge Securities Corporation, 1451 West Cypress Creek Road, Ft Lauderdale, Florida 33309 or (b) if to the Company, to the attention of its Chief Executive Officer at its office maintained pursuant to Section 10.2(a) hereof; provided, that the exercise of the Warrant shall also be effected in the manner provided in Section 3 hereof.  Notices shall be deemed properly delivered and received when delivered to the notice party (i) if personally delivered, upon receipt or refusal to accept delivery, (ii) if sent via facsimile, upon mechanical confirmation of successful transmission thereof generated by the sending telecopy machine, (iii) if sent by a commercial overnight courier for delivery on the next Business Day, on the first Business Day after deposit with such courier service, or (iv) if sent by registered or certified mail, five (5) Business Days after deposit thereof in the U.S. mail.

13.           Payment of Taxes.  The Company will pay all documentary stamp taxes attributable to the issuance of Ordinary Shares underlying this Warrant upon exercise of this Warrant; provided, however, that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the transfer or registration of this Warrant or any certificate for Ordinary Shares or ADSs underlying this Warrant in a name other that of the Holder.  The Holder is responsible for all other tax liability that may arise as a result of holding or transferring this Warrant or receiving Ordinary Shares in the form of ADSs underlying this Warrant upon exercise hereof.

14.           Miscellaneous.  This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge or termination is sought.  This Warrant shall be construed and enforced in accordance with and governed by the laws of the State of New York.  The section headings in this Warrant are for purposes of convenience only and shall not constitute a part hereof.  When used herein, the term “Reasonable Best Efforts” means, with respect to the applicable obligation of the Company, reasonable best efforts for similarly situated, publicly-traded companies.

IN WITNESS WHEREOF, the Company has caused this Underwriter’s’ Warrant to be duly executed as of the date first above written.

GRAND FARM, INC

By: 

       Name:

       Title:

EXHIBIT A

FORM OF EXERCISE NOTICE

[To be executed only upon exercise of Warrant]

To GRAND FARM, INC.:

The undersigned hereby elects irrevocably to exercise the within Warrant and to purchase ______ Warrant Shares of Grand Farm Inc. and hereby makes payment of $ ___________  (at the rate of $________ per Warrant Share) in payment of the Exercise Price pursuant thereto. Please issue the Warrant Shares as to which this Warrant is exercised in accordance with the instructions given below.

or

The undersigned hereby elects irrevocably to convert its right to purchase ______ Warrant Shares purchasable under the within Warrant by surrender of the unexercised portion of the attached Warrant (with a “Value” of $______ based on a “Current Market Price” of $______). Please issue the Warrant Shares as to which this Warrant is exercised in accordance with the instructions given below.

Issuance Instructions:  Certificates for such Warrant Shares shall be issued, subject to Sections 9 and 10, in the name of, and delivered to:

______________________________________

______________________________________

______________________________________

______________________________________

The undersigned hereby represents and warrants that it is, and has been since its acquisition of the Warrant, the record and beneficial owner of the Warrant.

Dated: _______________

________________________________________

Print or Type Name

________________________________________

(Signature must conform in all respects to name of holder as specified on the face of Warrant)

________________________________________

(Street Address)

________________________________________

(City)                      (State)      (Zip Code)

EXHIBIT B

FORM OF ASSIGNMENT

[To be executed only upon transfer of Warrant]

For value received, the undersigned registered holder of the within Warrant hereby sells, assigns and transfers unto _____________________ [include name and addresses] the rights represented by the Warrant to purchase __________ Ordinary Shares in the form of ADSs of GRAND FARM, INC to which the Warrant relates, and appoints _____________________ Attorney to make such transfer on the books of GRAND FARM, INC maintained for the purpose, with full power of substitution in the premises.

Dated:                                ________________________________________

                                        (Signature must conform in all respects

                                        to name of holder as specified on the

                                        face of Warrant)

                                        ________________________________________

                                        (Street Address)

                                        ________________________________________

                                        (City)        (State)      (Zip Code)

Signed in the presence of:

                                        ________________________________________

                                        (Signature of Transferee)

                                        ________________________________________

                                        (Street Address)

                                        ________________________________________

                                        (City)        (State)      (Zip Code)

Signed in the presence of:

EX-5.1

ForbesHare Elizabethan Square · PO Box 856 Grand Cayman · KY1-1103 Cayman Islands   T: +1 345943 7700; F: +1 345 943 7705 www.forbeshare.com

[●] 2011

Grand Farm Inc.

No 2089 East Hanhua Road

Guohiuan Town, HanjangDistraict

Putian, Fujian Province

China 35111

Dear Sirs

We are Cayman Islands counsel for Grand Farm Inc., a Cayman Islands’ company (the “Company”), in connection with the Company’s registration statement on Form F-1, including all amendments or supplements thereto (the “Registration Statement”), originally filed on [●] 2011 (File No. 333-[●]) with the Securities and Exchange Commission under the U.S. Securities Act of 1933, as amended to date. The Registration Statementrelatesto the initial public offering (the “Offering”) by the Company of certain American Depositary Shares representing the Company’s ordinary shares of par value US$0.002 each (the “Ordinary Shares”), including those underlying an option to acquire further Ordinary Shares in the form of American Depositary Shares (the “Option Shares”), and the issue to the underwriter of the Offering (or its designated affiliates) warrants to purchase a number of American Depositary Shares that is equal to 7% of the aggregate number of American Depositary Shares sold in the Offering (including the underlying Ordinary Shares to support the American Depositary Shares on the exercise of a Warrant), including the Option Shares (the “Warrants”).The Warrants will be exercisable at a per American Depositary Share exercise price equal to 150% of the Offering price, and may be exercised on a cashless basis. We are furnishing this opinion as Exhibit 5.1 to the Registration Statement.

In connection with rendering our opinion as set forth below, we have reviewed and examined the following:

(a)  The Certificate of Incorporation of the Company dated [●];

(b)  Memorandum of Association and Articles of Association of the Company as adopted by the Company by a special resolution of the shareholders on [●], 2011;

(c)  The statutory registers of directors and officers of the Company;

(d)  The statutory registers of mortgages and charges of the Company;

(e)  A copy of the minutes containing the written deliberations and resolutions of the Board of Directors of the Company dated [●] 2011;

Page 2

(f)  A certificate of good standing of the Company dated [●] 2011;

(g)  A certificate from [●] (being a Director of the Company) addressed to this firm dated [●] 2011, a copy of which is attached hereto (the “Director’s Certificate”);

(h)  The Registration Statement; and

(i)  Such other documents and laws as we consider necessary as a basis for giving this opinion.

The Registration Statement and the exhibits to the Registration Statement are referred to below as the “Documents”.

The following opinion is given only as to matters of Cayman Islands law and we express no opinion with respect to any matters governed by or construed in accordance with the laws of any jurisdiction other than the Cayman Islands. We have assumed that there is nothing under any law (other than the laws of the Cayman Islands) which would affect or vary the following opinion. Specifically, we have made no independent investigation of the laws of the United States of America generally and we offer no opinion in relation thereto. We offer no opinion in relation to any representation or warranty given by any party to the Documents save as specifically hereinafter set forth. This opinion is strictly limited to the matters stated in it, does not apply by implication to other matters, and only relates to (1) those circumstances or facts specifically stated herein and (2) the laws of the Cayman Islands, as they respectively exist at the date hereof.

In giving this opinion we have assumed, without independent verification:

(a)  the genuineness of all signatures and seals, the authenticity of all documents submitted to us as originals, the conformity of all copy documents or the forms of documents provided to us to their originals or, as the case may be, to the final form of the originals and that any markings showing revisions or amendments to documents are correct and complete;

(b)  that the copies produced to us of minutes of meetings and/or of resolutions are true copies and correctly record the proceedings of such meetings and/or the subject matter which they propose to record and that all factual statements therein contained are true and correct and that any meetings referred to in such copies were duly convened and held and that all resolutions set out in such copy minutes or resolutions were duly passed and are in full force and effect and that all factual statements made in such resolutions, the Director’s Certificate and any other certificates and documents on which we have relied are true and correct (and continue to be true and correct);

 (c)  that the statutory registers of directors and officers, and mortgages and charges and the minute book of the Company are true, complete, accurate and up to date;

(d)  the accuracy of all representations, warranties and covenants as to factual matters made by the parties to the Documents; and

(e)  that there is no contractual or other prohibition (other than as may arise by virtue of the laws of the Cayman Islands) binding on the Company or on any other party prohibiting it from entering into and performing its obligations.

The following opinions are given only as to matters of Cayman Islands law and we have assumed that there is nothing under any other law that would affect or vary the following opinions.

Page 3

Based upon the foregoing and subject to the qualifications set out below and having regard to such legal considerations as we deem relevant, we are of the opinion that:

1.  The Company has been duly incorporated as an exempted company with limited liability for an unlimited duration and is validly existing under the laws of the Cayman Islands.

2.  The authorised share capital of the Company, with effect immediately prior to the completion of the Company’s initial public offering of its Ordinary Shares, represented by American Depositary Shares, in the U.S. will be US$200,000 divided into 100,000,000 shares of a nominal or par value of US$0.002 per share.

3.  The issue and allotment of the Ordinary Shares(including those underlying the Option Shares and the Warrants) havebeen duly authorised. When allotted, issued and paid for as contemplated in the Registration Statement and registered in the register of members (shareholders), the Ordinary Shares(including those underlying the Option Shares and the Warrants) will be legally issued and allotted, fully paid and nonassessable.

4.  The issue and allotment of the Warrants has been duly authorised. When allotted, issued and paid for as contemplated in the Registration Statement, the Warrants will be legally issued and allotted, fully paid and nonassessable.  The choice of the laws of New York as the proper law to govern the Warrants is a valid choice of law under Cayman Islands law and such choice of law would be recognised, upheld and applied by the courts of the Cayman Islands as the proper law of the Warrants in proceedings brought before them in relation to the Warrants, provided that (a) the point is specifically pleaded; (b) such choice of law is valid and binding under the laws of New York; and (c) recognition would not be contrary to public policy as that term is understood under Cayman Islands law.

The foregoing opinion is subject to the following reservations and qualification:

1.  In the event that the Documents are executed in or brought within the jurisdiction of the Cayman Islands (e.g., for the purposes of enforcement or obtaining payment) stamp duty may be payable.

2.  We neither express nor imply any opinion as to any representation or warranty given by the Company in the Documents as to its capability (financial or otherwise) to undertake the obligations assumed by it under the Documents.

3.  To maintain the Company in good standing under the laws of the Cayman Islands annual fees must be paid and annual returns made to the Registrar of Companies.

We hereby consent to the use of this opinion as an exhibit to the Registration Statement and to the use of our name under the caption “Legal Matters” in the Prospectus constituting a part thereof. In giving such consent, we do not thereby admit that we come within the category of persons whose consent is required under section 7 of the U.S. Securities Act of 1933, as amended, or the Rules and Regulations of the Commission thereunder.

Yours faithfully

Forbes Hare

EX-8.1

ForbesHare Elizabethan Square · PO Box 856 Grand Cayman · KY1-1103 Cayman Islands   T: +1 345943 7700; F: +1 345 943 7705 www.forbeshare.com

[●]2011

Grand Farm Inc.

No 2089 East Hanhua Road

Guohiuan Town, HanjangDistraict

Putian, Fujian Province

China 35111

Dear Sirs

We have acted as counsel to Grand Farm Inc. a Cayman Islands exempt company (the “Company”), in connection with the filing of a Registration Statement on Form F-1,including all amendments or supplements thereto (the “Registration Statement”), originally filed on [●] 2011 (File No. 333-[●]) with the Securities and Exchange Commission under the U.S. Securities Act of 1933, as amended to date. The Registration Statement relates to the initial public offering (the “Offering”) by the Company of certain American Depositary Shares representing the Company’s ordinary shares of par value US$0.002 each (the “Ordinary Shares”), including those underlying an option to acquire further Ordinary Shares in the form of American Depositary Shares (the “Option Shares”), and the issue to the underwriter of the Offering (or its designated affiliates) warrants to purchase a number of American Depositary Shares that is equal to 7% of the aggregate number of American Depositary Shares sold in the Offering (including the underlying Ordinary Shares to support the American Depositary Shares on the exercise of a Warrant), including the Option Shares.

You have requested our opinion concerning statements under the heading “Taxation – Cayman Islands Taxation” in the prospectus forming a part of the Registration Statement.

We have examined such documents, including the Registration Statement, and matters of law as we have deemed necessary for purposes of this opinion. We have assumed that the transactions described in the Registration Statement will be performed in the manner described therein and that the agreements forms of which are attached as exhibits to the Registration Statement will be performed in accordance with their terms.

The following opinion is given only as to matters of Cayman Islands law and we express no opinion with respect to any matters governed by or construed in accordance with the laws of any jurisdiction other than the Cayman Islands. This opinion is strictly limited to the matters stated in it, does not apply by implication to other matters, and only relates to (1) those circumstances or facts specifically stated herein and (2) the laws of the Cayman Islands, as they respectively exist at the date hereof.

Page 2

Based on the foregoing, and subject to the limitations and qualifications set forth in this opinion, we confirm that the statements under the heading “Taxation – Cayman Islands Taxation” in the prospectus forming a part of the Registration Statement are accurate under currently applicable Cayman Islands tax law and, to the extent that such statements constitute matters of Cayman Islands tax law or legal conclusions relating to Cayman Islands tax laws, subject to the qualifications therein, represent our opinion.

Our opinion set forth herein is subject to the following limitations and qualifications:

A.  Our opinion is rendered to the Company as of the date of this letter and we undertake no obligation to update it subsequent to the date of this letter.

B.  Any changes or differences in the facts from those disclosed in the Registration Statement will affect our opinion.

We hereby consent to the filing of this opinion as an Exhibit to the Registration Statement. In giving such consent, we do not thereby concede that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Securities and Exchange Commission thereunder.

Yours faithfully

Forbes Hare

EX-8.2

[LETTERHEAD OF LKP GLOBAL LAW, LLP]

[DATE], 2011

Grand Farm Inc.

[ADDRESS]

China

Dear Ladies and Gentlemen:

We are acting as United States counsel to Grand Farm Inc., a company incorporated under the laws of the Cayman Islands (the “Company”), in connection with the preparation of the registration statement on Form F-1 (the “Registration Statement”) and the related prospectus (the “Prospectus”) with respect to the Company’s American depositary shares representing the Company’s ordinary shares to be offered in the Company’s initial public offering.  The Company is filing the Registration Statement with the Securities and Exchange Commission under the Securities Act of 1933, as amended.

We have examined such matters of fact and law as we have deemed necessary or advisable for the purpose of this opinion.

We hereby confirm our opinion set forth under the caption “Taxation” relating to the statements or legal conclusions set forth under the caption “Taxation—United States Federal Income Taxation” in the Prospectus.

We are members of the Bar of the State of California, and we express no opinion as to the laws of any jurisdiction other than the laws of the State of California and the federal laws of the United States.

We hereby consent to the use of our name under the captions “Taxation” and “Legal Matters” in the Prospectus included in the Registration Statement and to the filing, as an exhibit to the Registration Statement, of this opinion.

In giving such consent we do not admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended.

Very truly yours,

LKP Global Law, LLP

EX-8.3

 

	B & D Law Firm
	10th Floor Botai Plaza, No.221 Wangjing Xiyuan
	Chaoyang District, Beijing, 100102, P.R.C.
	Tel: (86 10) 6478 9105  Fax: (86 10 ) 6478 9550
	info@bdlawyer.com.cn    www.bdlawyer.com.cn

[DATE]

To: Grand Farm Inc.

Add: No.2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, China 351111

Dear Sirs,

We are qualified to practice law in the People’s Republic of China (“PRC” which, for the purpose of this opinion only, excludes the Hong Kong Special Administrative Region, the Macau Special Administrative Region and Taiwan) and are qualified to issue the legal opinion on the laws and the regulations of the PRC. We have acted as PRC counsel to Grand Farm Inc. (the “Company”), a company organized under the laws of Cayman Islands, and have been asked to render this legal opinion with regard to the PRC laws in connection with (i) the Company’s Registration Statement on Form F-1, including all amendments or supplements thereto (the “Registration Statement”) filed with the Securities and Exchange Commission under the U.S. Securities Act of 1933, as amended, relating to the Company’s proposed initial public offering of American Depositary Shares (the “ADSs”) representing ordinary shares, par value $0.002 per share, of the Company (the “Offering”), and (ii) the admission of the ADSs for trading on the NASDAQ Capital Market.

For the purpose of the Offering, “PRC Laws” means all laws, regulations, rules, orders, decrees, guidelines or notices effective in the PRC as at the date hereof.

Our opinion is subject to the following qualifications:

(a) This opinion relates only to PRC Laws and we express no opinion as to any laws other than PRC Laws. There is no assurance that any of such laws will not be changed, amended or replaced in the immediate future or in the longer term with or without retrospective effect and any such changes, amendments or replacements may be made by the central or local legislative, administrative and judicial authorities of the PRC and may become effective immediately on promulgation.

(b) This opinion is intended to be used in the context which is specially referred to herein and each section should be considered as a whole and no part should be extracted and referred to independently.

Based on the foregoing and subject to the qualifications set out above, we are of the opinion that, as of the date hereof, so far as PRC Laws are concerned, the statements set forth in the Registration Statement under the caption “Taxation — PRC Taxation” are true and accurate based on the PRC Laws and that such statements constitute our opinion.

We hereby consent to the use of this opinion by you in connection with, and the filing hereof as an exhibit to, the Registration Statement. In giving such consent, we do not thereby admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the regulations promulgated thereunder.

We further consent to the reference to our firm as the Company’s PRC counsel in the “Risk Factors”, “Taxation” and “Legal Matters” sections in the Registration Statement.

Yours faithfully,

B & D Law Firm

EX-10.1

EXCLUSIVE TECHNICAL CONSULTING SERVICE AGREEMENT

EXCLUSIVE TECHNICAL CONSULTING SERVICE AGREEMENT

THIS EXCLUSIVE TECHNICAL CONSULTING SERVICE AGREEMENT (the “Agreement”) is made and entered into by and between the following parties as of September 25, 2010 in Fujian, the People’s Republic of China (“China” or the “PRC”):

Party A: Putian Asia Success Cereals & Oils Technical Service Co., Ltd

Registered Address: No. 999, Houguo Street, Sanjiangkou Town, Hanjiang District, Putian City

Party B: Fujian Grand Farm Foods Development Co., Ltd.

Registered Address: Linbing Village, Guohuan Town, Hanjiang District, Putian City

Each of Party A and Party B shall be hereinafter referred to as a “Party” respectively, and as the “Parties” collectively.

WHEREAS,

1. Party A, a wholly foreign-owned enterprise duly established and validly existing under the laws of the PRC, possesses professional knowledge, facilities, resources and skills to provide Party B with technical consulting services relevant to the development and operation of Party B’s business.

2. Party B, a limited liability company duly established and validly existing under the laws of the PRC, agrees to accept the technical consulting services provided by Party A in accordance with this Agreement.

NOW THEREFORE, through mutual discussion, the Parties have agreed as follows:

1. Technical Consulting Services; Exclusivity

1.1 During the term of this Agreement, Party A shall provide the following technical consulting services to Party B in accordance with this Agreement:

(i) Provision of advanced management skills to offer a framework for the construction of a new management platform;

(ii) Provision of technology information and materials related to Party B’s business development and operation, the contents of which may be enhanced or diminished during the performance of this Agreement and upon mutual agreement to address each Party’s requirements; and

(iii) Training of technical and managerial personnel for Party B and provision of required training documents, and the provision of technologists and managerial personnel to Party B as necessary to provide related technology and training services.

Page 1 of 7

EXCLUSIVE TECHNICAL CONSULTING SERVICE AGREEMENT

1.2 Party B hereby agrees to accept the technical consulting services provided by Party A. Party B further agrees that, during the term of this Agreement, it shall not accept technical consulting and services from any other party without the prior written consent of Party A.

1.3 Party A shall be the sole and exclusive owner of all right, title and interests to any and all intellectual property rights arising from the performance of this Agreement, including but not limited to, copyrights, patent, know-how and commercial secrets, whether such intellectual property is developed by Party A or Party B.

2. Consulting Fee

2.1 As consideration for the services provided by Party A under this Agreement, Party B shall pay an annual consulting fee to Party A equal to 85% of Party B’s annual net profit (the “Consulting Fee”).

2.2 Party A agrees to reimburse Party B for all necessary expenses related to the performance of this Agreement before Party B pays such Consulting Fee, including but not limited to, travel expenses, expert fees, printing fees and mail costs.

2.3 Party A also agrees to reimburse Party B for taxes (not including income tax), customs and other expenditures related to Party B’s performance of this Agreement.

2.4 Party B shall pay such Consulting Fee to Party A on a semi-annual basis, with any over- or underpayment by Party B to be reconciled once the annual net profit of Party B is determined at the end of Party B’s fiscal year. During the term of this Agreement, Party B shall make payments of the Consulting Fee to the bank account described in Section 2.5 below within three (3) working days after each semi-year end, and the Parties shall complete any reconciliation payment within three (3) days after the determination described in Section 2.5 below. In the event that Party B should fail to make timely payment of the Consulting Fee or other necessary expenses in accordance with this Agreement, Party B shall pay a late fee to Party A based on one percent (1%) compound annual interest of the payment amount then due, from the date of such nonpayment until payment is made in full.

2.5 Party B shall open and maintain a separate bank account for payment of the Consulting Fee and any other payments under this Agreement. Within ninety (90) calendar days after each fiscal year end, Party B shall furnish a written report of its net profit for such fiscal year end to Party A to reconcile the Consulting Fee. Party A is entitled to appoint its own employee, PRC accountant or international accountant to review or audit Party B’s account books to verify the amount of the Consulting Fee and in relation to the services provided hereunder. Any fees payable to such an accountant shall be paid by Party A. Party B shall provide any and all documents, account books, records, materials and information, as well as necessary assistance to the employee or accountant designated by Party A. The audit report issued by Party A’s employee shall be final and conclusive unless Party B gives written objection within seven (7) days after receiving such report. An audit report issued by Party A’s appointed accountant shall be deemed final and conclusive. Party A is entitled to serve Party B with a written request for payment of any deficient amount at any time after receiving the audit report confirming the amount of the Consulting Fee. Party B shall pay within seven (7) days after receiving the notice in accordance with Section 2.4.

Page 2 of 7

EXCLUSIVE TECHNICAL CONSULTING SERVICE AGREEMENT

3. Representations and Warranties

3.1 Representations and Warranties of Party A

Party A hereby represents and warrants as follows:

3.1.1 Party A is a company that is duly registered, validly existing under the laws of the PRC and is authorized to enter into this Agreement.

3.1.2 Party A has the power to enter into and perform this Agreement in accordance with its charter and organizational documents as well as its business scope, and has taken all necessary action to obtain all consents and approvals necessary to execute and perform this Agreement, and the execution and performance of this Agreement by Party A does not and will not result in any violation of enforceable or effective laws or contractual limitations.

3.1.3 Upon execution, this Agreement shall constitute the legal, valid and binding obligation of Party A and may be enforceable in accordance with the terms hereof.

3.2 Representations and Warranties of Party B

Party B hereby represents and warrants as follows:

3.2.1 Party B is a company that is duly registered, validly existing under the laws of the PRC and is authorized to enter into this Agreement.

3.2.2 Party B has the power to execute and perform this Agreement in accordance with its charter and organizational documents as well as its business scope, has taken all necessary action to obtain all consents and approvals necessary to execute and perform this Agreement, and the execution and performance of this Agreement by Party B does not and will not result in any violation of enforceable or effective laws or contractual limitations.

3.2.3 Upon its execution, this Agreement shall constitute the legal, valid and binding obligation of Party B, enforceable against it in accordance with the terms hereof.

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EXCLUSIVE TECHNICAL CONSULTING SERVICE AGREEMENT

4. Confidentiality

4.1 Party B agrees to use all reasonable and best efforts to protect and maintain the confidentiality of Party A’s confidential information received in connection with this Agreement. Party B shall not disclose, grant or transfer such confidential information to any third party. Upon termination of this Agreement Party B shall, upon Party A’s request, destroy or return to Party A any documents, materials or software containing any such confidential information, shall completely delete any such confidential information from any memory devices and shall not use or permit any third party to use such confidential information.

4.2 Pursuant to this Agreement, the term “confidential information” shall mean any technical information or business operation information which is unknown to the public, can bring about economic benefits, has practical utility and about which a Party has adopted secret-keeping measures.

4.3 Both Parties agree that the provisions of Article 4 shall survive notwithstanding the alteration, revocation or termination of this Agreement.

5. Indemnities

5.1 Party B shall indemnify Party A against any loss, damage, liability or expenses suffered or incurred by Party A as a result of or arising out of any litigation, claim or compensation request relating to the technical consulting services provided by Party A to Party B under this Agreement.

6. Effectiveness and Term of this Agreement

6.1 This Agreement shall be executed and come into effect as of the date first set forth above. The term of this Agreement shall be 50 years unless earlier termination as set forth in this Agreement or upon the mutual written agreement of the Parties hereto.

6.2 This Agreement may be extended prior to termination for one or more 50 year terms upon written notice by Party A, provided such extension is permitted by law and subject to the approval of the registration administration for the extension of Party B’s business duration. The parties will cooperate to renew this Agreement if such renewal is legally permitted at the time.

7. Termination of the Agreement

7.1 The Agreement shall terminate automatically on the expiration date unless it is otherwise renewed in accordance with this Agreement.

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EXCLUSIVE TECHNICAL CONSULTING SERVICE AGREEMENT

7.2 Throughout the term of this Agreement, Party B may not terminate this Agreement absent of gross negligence, bankruptcy, fraud or illegal action on the part of Party A. Notwithstanding the above, Party A may terminate this Agreement by providing written notice to Party B thirty (30) days before such termination.

7.3 The rights and obligations of both Parties under Article 4 and Article 5 of this Agreement shall survive after the termination of this Agreement.

8. Dispute Settlement

8.1 The Parties shall strive to settle any dispute arising from the interpretation or performance, or in connection with this Agreement through mutual negotiation. In case no settlement can be reached through negotiation, either Party may submit such dispute to the China International Economic and Trade Arbitration Committee for arbitration according to its then effective arbitration rules. The arbitration shall be held in Beijing, PRC. The arbitration proceedings shall be conducted in Chinese. The arbitration award shall be final and binding upon the Parties.

9. Force Majeure

9.1 A “Force Majeure Event” means any event which is out of the control of each party and that would be unavoidable or insurmountable even if the Party affected by such event paid reasonable attention to it. Force Majeure Events shall include, but not be limited to, government actions, natural disasters, fire, explosion, typhoons, floods, earthquakes, tide, lightning or war. However, any lack of credit, assets or financing shall not be deemed a Force Majeure Event.

9.2 If the fulfillment of this Agreement is delayed or prevented due to a Force Majeure Event as defined above, the Party affected by such a Force Majeure Event shall be free from any obligation to the extent of the delay or holdback. The Party claiming the occurrence of a Force Majeure Event shall provide the other Party with the steps of fulfilling the obligations of this Agreement.

9.3 Performance under this Agreement shall be suspended during the existence of such Force Majeure Event, provided the Party claiming the existence of the Force Majeure Event has notified the other Party of the existence of such Force Majeure Event and has used reasonable best efforts to perform under the Agreement. Both Parties further agree to use reasonable best efforts to resume performance of this Agreement if the reason for exemption has been corrected or remedied.

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EXCLUSIVE TECHNICAL CONSULTING SERVICE AGREEMENT

10. Notices

10.1 Any notice or other communication under this Agreement shall be in Chinese and be sent to the addresses first written above or other addresses as may be designated from time to time by hand delivery or mail or facsimile. Any notice required or given hereunder shall be deemed to have been served: (a) on the same date if sent by hand delivery; (b) on the tenth date after posting if sent by air-mail, (c) on the fourth date if sent by professional hand delivery which is acknowledged worldwide; and (d) the receipt date displayed on the transmission confirmation notice if sent by facsimile.

11. Assignment

11.1 Party B may not assign or transfer any rights or obligations under this Agreement to any third party without prior written consent from Party A. Party B hereby agrees that Party A may assign and transfer its rights and obligations under this Agreement, and no any further consent from Party B will be required.

12. Severability

12.1 If any of the terms of this Agreement are invalid, illegal or unenforceable, the validity and enforceability of the other terms hereof shall nevertheless remain unaffected.

13. Amendments and Supplement

13.1 Any amendment or supplement of this Agreement shall be effective only if it is made in writing and signed by both Parties hereto. The amendment or supplement duly executed by the Parties hereto shall be made a part of this Agreement and shall have the same legal effect as this Agreement.

14. Governing Law

14.1 The execution, effectiveness, construction, performance, amendment and termination of this Agreement and the resolution of disputes hereunder shall be governed by the laws of China.

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EXCLUSIVE TECHNICAL CONSULTING SERVICE AGREEMENT

IN WITNESS THEREOF each party hereto has caused this Agreement to be duly executed by itself or a duly authorized representative on its behalf as of the date first written above.

Party A: Putian Asia Success Cereals & Oils Technical Service Co., Ltd [seal]
By:	/s/ Yao Jianshan
Name:	Yao Jianshan
Title:	Chief Executive Officer
Party B:Fujian Grand Farm Foods Development Co., Ltd. [seal]
By:	/s/ Yao Jianshan
Name:	Yao Jianshan
Title:	Chief Executive Officer

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EX-10.2

OPERATING AGREEMENT

OPERATING AGREEMENT

THIS OPERATING AGREEMENT (the “Agreement”) is made and entered into among the following parties as of September 25, 2010 in Fujian, the People’s Republic of China (“China” or the “PRC”):

Party A:   Putian Asia Success Cereals & Oils Technical Service Co., Ltd

Address:  No. 999, Houguo Street, Sanjiangkou Town, Hanjiang District, Putian City

Party B:   Fujian Grand Farm Foods Development Co., Ltd.

Address:  No. 2089, Hanhua East Road, Guohuan Town, Hanjiang District, Putian City

Party C:  Yao Jianshan

ID No.: 350303690720035

Party D:  Yao Jianxin

ID No.: 350303197201280334

WHEREAS:

1. Party A is a wholly foreign-owned enterprise duly incorporated and validly existing under the People’s Republic of China (the “PRC”) law, which has the technology, expertise, practical experience and professional technicians to provide consulting services relevant to the development and operation of Party B’s business.

2. Party B is a limited liability company duly incorporated and validly existing under the PRC law;

3. Party C and Party D are shareholders of Party B who collectively own 100% of the equity interests of Party B;

4. Party A has established a business relationship with Party B pursuant to an Exclusive Technical Consulting Service Agreement entered into by and between them dated as of September 25, 2010 (the “Service Agreement”);

5. Pursuant to the Service Agreement, Party B shall pay Party A certain fees as set forth in the Service Agreement, and the daily operations of Party B will have a material effect on its ability to pay such fees to Party A;

6. The Parties desire to enter into this Agreement to provide for Party A’s guarantee of expenses and losses of Party B and clarify matters in connection with Party B’s operation.

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OPERATING AGREEMENT

NOW THEREFORE, through mutual discussion, all parties to this Agreement have agreed as follows:

1. Party A agrees, subject to the satisfaction by Party B of the relevant provisions herein, to serve as guarantor for Party B in contracts, agreements or transactions relating to Party B’s operations that are entered into between Party B and any other third party, to provide full guarantee for the performance of such contracts, agreements or transactions by Party B. Party B agrees, as counter-guarantee, to pledge the receivable account from its operations and its entire assets to Party A. According to the aforesaid guarantee arrangement, Party A may, when necessary, enter into written guarantee contracts with Party B’s counter-parties thereof to assume the guarantee liability as the guarantor , and Party B, Party C and Party D shall take all necessary actions (including but not limited to executing relevant documents and transacting relevant registrations) to carry out the arrangement of counter-guarantee to Party A.

2. In consideration of the requirement of Article 1 herein and to ensure the performance by Party B of its obligations under the Service Agreement, Party B, Party C and Party D hereby jointly agree that Party B shall not conduct any transaction which may materially affect its assets, obligations, rights or operation (excluding business contracts entered into in the ordinary course of Party B’s regular operations and the liens obtained by relevant counter parties due to such contracts) without Party A’s prior written consent. Such transactions shall include, but are not limited to, the following matters:

2.1 borrowing money from any third party or assuming any debt;

2.2 selling to or acquiring from any third party any asset or right, including but not limited to any intellectual property right;

2.3 providing any guarantee for any third party with any of its assets or intellectual property rights; or

2.4 assigning to any third party its business agreements.

3. In order to further ensure the performance by Party B of its obligations under the Service Agreement, Party B, Party C and Party D hereby jointly agree to accept the corporate policy advice and guidance provided by Party A from time to time during the term of this Agreement in connection with Party B’s daily operations as well as the financial management and the recruitment, retention and dismissal of Party B’s employees.

4. Party B, Party C and Party D hereby jointly agree that Party C and Party D shall cooperate to appoint the persons recommended by Party A as the directors of Party B, and Party B shall appoint Party A’s senior managers as Party B’s General Manager, Chief Financial Officer, and other senior officers. If any of the above senior officers leaves or is dismissed by Party A, he or she will lose the qualification to take any position in Party B and Party B shall appoint such other senior officers of Party A recommended by Party A to take such position. The persons recommended by Party A in accordance with this Article herein shall comply with the stipulation on the qualifications of directors, General Manager, Chief Financial Officer, and other senior officers pursuant to applicable law.

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OPERATING AGREEMENT

5. Party B, Party C and Party D hereby jointly agree and confirm that Party B shall first seek guarantee from Party A if such guarantee is required for Party B’s performance of any contract or loan for working capital in the course of operation. In such case, Party A shall have the right but not the obligation to provide the appropriate guarantee to Party B at its own discretion. If Party A decides not to provide such guarantee, Party A shall issue a written notice to Party B immediately and Party B shall seek a guarantee from a third party.

6. In the event that any of the agreements between Party A and Party B terminates or expires, Party A shall have the right but not the obligation to terminate all agreements between Party A and Party B, including but not limited to the Service Agreement.

7. Any amendment and supplement of this Agreement shall be made in writing. The amendment and supplement duly executed by all parties shall be deemed as a part of this Agreement and shall have the same legal effect as this Agreement.

8. If any clause hereof is judged as invalid or unenforceable according to relevant laws, such clause shall be deemed invalid only within the applicable area of the Law and shall not affect the validity or enforceability of any other clause in this Agreement in any way.

9. Party B shall not assign or transfer its rights and obligations under this Agreement to any third party without the prior written consent of Party A. Party B hereby agrees that Party A may assign and transfer its rights and obligations under this Agreement subject only to a written notice to Party B by Party A, and no any further consent from Party B will be required.

10. All parties acknowledge and confirm that any oral or written materials communicated pursuant to this Agreement are confidential documents. All parties shall keep all such documents confidential and not disclose any such documents to any third party without prior written consent from other parties except under the following conditions: (a) such documents are known or shall be known by the public (other than when the receiving party discloses such documents to the public without authorization); (b) any documents disclosed in accordance with applicable laws or rules or regulations of a stock exchange with jurisdiction; (c) any documents required to be disclosed by any party to its legal counsel or financial consultant for the purpose of the transactions contemplated under this Agreement, provided that such legal counsel or financial consultant shall also comply with the confidentiality as stated hereof. Any disclosure by employees or agents employed by any party shall be deemed the disclosure of such party and such party shall assume all liabilities resulting from such disclosure. This Article shall survive the termination of, amendment of, cancellation of or the inability to perform any other clause in this Agreement.

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OPERATING AGREEMENT

11. This Agreement shall be governed by and construed in accordance with PRC law.

12. The parties shall strive to settle any dispute arising from the interpretation or performance of this Agreement through friendly consultation. In case no settlement can be reached through consultation, each party can submit such matter to China International Economic and Trade Arbitration Commission (“CIETAC”) for arbitration in accordance with the then effective rules of CIETAC. The arbitration proceedings shall take place in Beijing and shall be conducted in Chinese. The arbitration award shall be final and conclusive and binding upon all the parties.

13. This Agreement shall be executed by a duly authorized representative of each party as of the date first written above and shall become effective concurrently.

14. The parties confirm that this Agreement shall constitute the entire agreement of the Parties with respect to the subject matters therein.

15. The term of this Agreement is 50 years unless earlier terminated in accordance with Article 16 herein or pursuant to any other relevant agreements reached by all parties. This Agreement may be extended at Party A’s written request prior to the expiration of this Agreement for additional terms of 50 years each.

16. This Agreement shall terminate upon expiration of its term unless renewed in accordance with Article 15 herein. During the term of this Agreement, Party B shall not terminate this Agreement. Notwithstanding the above stipulation, Party A shall have the right to terminate this Agreement at any time by issuing a thirty (30) day prior written notice to Party B, and this Agreement shall terminate unless assigned in accordance with Article 9 hereof prior to the end of such notice period.

17. This Agreement may be executed in one or more original or facsimile copies.

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OPERATING AGREEMENT

IN WITNESS THEREOF each party hereto has caused this Agreement to be duly executed by itself or a duly authorized representative on its behalf as of the date first written above.

Party A: Putian Asia Success Cereals & Oils Technical Service Co., Ltd

Authorized Representative: Yao Jianshan

Seal: [seal]

Party B: Fujian Grand Farm Foods Development Co., Ltd.

Authorized Representative: Yao Jianshan

Seal: [seal]

Party C: Yao Jianshan

Signature: /s/ Yao Jianshan

Party D: Yao Jianxin

Signature: /s/ Yao Jianxin

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EX-10.3

 

EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

THIS EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT (the “Agreement”) is entered into by and among the following parties effective as of September 25, 2010.

Party A:Putian Asia Success Cereals & Oils Technical Service Co., Ltd, a wholly foreign-owned enterprise incorporated under the PRC laws with its registered address at No. 999, Houguo Street, Sanjiangkou Town, Hanjiang District, Putian City.

Party B: Yao Jianshan, a PRC citizen, with ID No. 350303690720035

Address: Linbing Village, Guohuan Town, Hanjiang District, Putian City

Party C: Fujian Grand Farm Foods Development Co., Ltd. a limited liability company duly established and validly existing under the laws of the PRC, with its registered address atNo. 2089, Hanhua East Road, Guohuan Town, Hanjiang District, Putian City.

WHEREAS,

1. Party B holds a 99.75% equity interest in Party C; and

2. Party A and Party C have entered into an Exclusive Technical Consulting Service Agreement and an Operating Agreement, both dated as of September 25, 2010.

NOW THEREFORE, intending to be bound hereby, the Parties hereto agree as follows:

1. Transfer of Equity Interest

1.1 Grant of Purchase Right

Party B hereby irrevocably grants Party A the exclusive right to purchase or designate one or more persons (each a “Specified Person”) to purchase all or any portion of the 99.75% equity interest in Party C held by Party B (the “Equity Interest”), subject to compliance with legal restrictions under applicable PRC laws (the “Purchase Right”). Party B shall not sell or transfer all or any portion of the Equity Interest to any party other than Party A and/or the Specified Person(s). Party C hereby agrees that Party B may grant the Purchase Right to Party A, and the other shareholders of Party C hereby waive any and all preemptive rights relating to the Equity Interest evidenced by the Announcement document attached hereto as the Appendix. The term “person” as used herein means an individual, corporation, joint enterprise, partnership, enterprise, trust or non-corporation organization.

1.2 Exercise of the Purchase Right

1.2.1 To the extent permitted under PRC laws, Party A, at its sole discretion, may decide the specific time, method and number of its exercise.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

1.2.2 When Party A intends to exercise the Purchase Right, it shall issue a written notice (the “Purchase Notice”) to Party B, and the Purchase Notice shall state the following: (a) Party A intends to exercise the Purchase Right; (b) the percentage of the Equity Interest to be purchased therewith; and (c) the effective date or transfer date. Party A may exercise the Purchase Right one or more times, in whole or in part.

1.3 Consideration of the Equity Interest

The Transfer Fee (“Transfer Fee”) payable by Party A shall be confirmed by both Party A and Party B through negotiation according to the evaluation of the Equity Interest by the relevant qualified institute, and it shall be the lowest price allowable by the PRC laws and regulations.

1.4 Transfer of the Equity Interest

Each time Party A exercises the Purchase Right in whole or in part:

1.4.1 Party B shall ensure that Party C timely convenes a shareholders’ meeting, at which the shareholders of Party C shall pass shareholders’ resolutions providing that Party B can transfer to Party A or the Specified Person(s) the Equity Interest as specified in the Purchase Notice.

1.4.2 Party B shall enter into a transfer agreement with Party A or the Specified Person(s) in relation to the Equity Interest to be transferred pursuant to the Purchase Notice.

1.4.3 The Parties shall execute all other agreements or documents, obtain all government approvals and consents, and take all actions necessary to legally transfer the ownership of the Equity Interest as specified in the Purchase Notice to Party A or the Specified Person(s) and ensure that Party A or the Specified Person will be registered as the owner of such Equity Interest. Such Equity Interest shall be free from any Security Interest or other encumbrance. For the purposes of this Agreement,“Security Interest” shall include any guarantee, mortgage, third party rights or interest, purchase rights, preemption rights, offset rights and any other security arrangements, but shall exclude any security interest granted in accordance with this Agreement and the Equity Interest Pledge Agreement entered into by and between Party B and Party A effective as of September 25, 2010 (the “Pledge Agreement”).

1.4.4 Party B and Party C shall unconditionally assist Party A in obtaining the governmental approvals, permits, registrations, filings and completing all the necessary formalities for obtaining the Equity Interest to be transferred pursuant to the Purchase Notice.

1.5 Payment for the Equity Interest

1.5.1 Party A shall pay the Transfer Fee to Party B in accordance with the provision of Article 1.3.

2. Covenants Relating to the Equity Interest

2.1 Covenants of Party C

2.1.1 Without the prior written consent of Party A, Party C will not supplement, amend, or modify any provisions of the charter and organizational documents of Party C and will not increase or reduce its registered capital or change the equity holding structures in any other way.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

2.1.2 Party C shall remain legally existing, in good standing, will prudently and efficiently operate its business and deal with corporate affairs in accordance with commercial standards and practice.

2.1.3 Without the prior written consent of Party A, Party C shall not sell, transfer, mortgage or dispose of any assets, business or beneficial rights of Party C, or allow any creation of another security interest or other encumbrance upon its assets.

2.1.4 Without the prior written consent of Party A, Party C shall not incur, inherit, or guarantee any debts except for (i) debt incurred during the course of normal business operations (excluding business loans); and (ii) the debt that has been previously disclosed to Party A and to which Party A has provided prior written consent.

2.1.5 Party C shall operate its business normally to maintain the value of its assets, and shall not take any action which shall bring any materially adverse influence upon the business operation or the value of the assets.

2.1.6 Without the prior written consent of Party A, Party C shall not enter into any material agreement except in the normal course of business. (For the purpose of this paragraph, an agreement covering an amount in excess of RMB 100,000 will be considered a material agreement).

2.1.7 Without the prior written consent of Party A, Party C shall not provide any loans or credit to any third party.

2.1.8 At Party A’s request, Party C shall provide Party A with any materials relating to the business operation and financial status of Party C.

2.1.9 Party C shall purchase insurance from an insurance company acceptable to Party A and shall maintain such insurance. The amount and kinds of such insurance shall be similar to insurance carried by other companies which operate similar businesses and possess similar assets.

2.1.10 Without the prior written consent of Party A, Party C shall not merge with, combine with, make investment in, purchase the equity or substantially all the assets of any other entity.

2.1.11 Within 24 hours after receiving notice or becoming aware thereof, Party C shall inform Party A of any actual or potential litigation, arbitration, or administrative procedure in relation to the Equity Interest.

2.1.12 In order to keep the ownership of all assets, Party C shall execute all necessary or proper documents, take all necessary or proper actions, substitute all necessary or proper claims, and make all necessary or proper answers to all compensation claims.

2.1.13 Without the prior written consent of Party A, Party C shall not allot any dividend to any shareholder. However, Party C shall immediately allot all dividends to the shareholders upon the request of Party A.

2.2 Covenants of Party B

2.2.1 Without the prior written consent of Party A, Party B shall not sell, transfer, mortgage or dispose of any rights or interest relating to the Equity Interest, or allow any creation of other security interests or encumbrances on the Equity Interest (excluding the Security Interest under this Agreement and the Pledge Agreement).

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

2.2.2 Party B shall use its best efforts to prevent the other shareholders of Party C from approving resolutions relating to the sale, transfer, mortgage, or disposal of any rights or interests relating to the Equity Interest, or allowing any creation of any security interest or other encumbrance on the Equity Interest (excluding the Security Interest created pursuant to this Agreement and the Equity Interest Pledge Agreement).

2.2.3 Party B shall use its best efforts to prevent the other shareholders of Party C from approving resolutions relating to Party C’s merger with, combination with, purchase of, or investment in any other entity.

2.2.4 Party B shall inform Party A of any actual or potential litigation, arbitration, or administrative procedure in relation to the Equity Interest.

2.2.5 Party B shall ensure that the other shareholders of Party C approve the transfer of the Equity Interest as set out in this Agreement.

2.2.6 In order to keep ownership of the Equity Interest, Party B shall cause Party C to execute all necessary or proper documents, take all necessary or proper actions, substitute all necessary or proper claims, and make all necessary or proper answer to all compensation claims.

2.2.7 At the request of Party A from time to time, Party B shall immediately transfer to Party A or the Specified Person(s) the Equity Interest pursuant to this Agreement.

2.2.8 Party B shall strictly comply with this Agreement and any other agreements which may be entered into by and among Party B, Party C and Party A collectively or separately, and shall perform its obligations under such agreements, and shall not take or fail to take any actions which actions or inactions will affect the validity and enforceability of such agreements.

3. Representations and Warranties

3.1 Party B and Party C jointly and severally represent and undertake as follows:

3.1.1 Each such party has the power to enter into and deliver this Agreement and such other agreements for the transfer of the Equity Interest to Party A or the Designated Person(s), and has the power and capacity to perform its obligations under this Agreement.

3.1.2 Neither the execution and delivery of this Agreement, nor the performance of the obligations under this Agreement will: (i) violate any PRC laws; (ii) conflict with the Articles of Association or other organizational documents of any party; (iii) breach any contract or document which such Party is a party to or which binds such Party; (iv) violate any required permit, approval or any valid qualification; or (v) result in the cessation, revocation or imposition of additional conditions on the required permit, approval or qualification.

3.1.3 Party C has full and transferable ownership of its assets and facilities. Other than the pledge and/or mortgage incurred by this Agreement and the pledge of the Equity Interest pursuant to the Pledge Agreement, there is no other pledge and/or mortgage on such assets and facilities.

3.1.4 Party C has no outstanding debt except for (i) the legal debt, incurred during the normal course of business; and (ii) the debt that has been previously disclosed to Party A.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

3.1.5 Party C complies with all applicable laws and regulations.

3.1.6 There is no actual, pending or potential litigation, arbitration, or administrative procedure in relation to the Equity Interest, assets of Party C or other matters relating to Party C.

4. Effectiveness and Term of this Agreement

4.1 This Agreement shall be executed and come into effect as of the date first set forth above. This Agreement shall expire on the date that is 50 years following the date hereof unless earlier terminated as set forth in this Agreement or upon mutual agreement of the Parties hereto.

4.2 This Agreement may be unilaterally extended prior to termination for a successive 50 year term upon written notice by Party A, provided such extension is permitted by law and subject to the approval of the registration administration for the extension of Party C’s business duration. The parties will cooperate to renew this Agreement upon such notice by Party A if such renewal is legally permitted at the time.

5.  Breach of Contract

5.1 If any party (the “Defaulting Party”) breaches any provision of this Agreement, which may cause damages to other parties (each a “Non-defaulting Party”), the Non-defaulting Party can notify the Defaulting Party in writing to rectify and correct such breach; if the Defaulting Party does not take actions which rectify and correct such breach to the satisfaction of the Non-defaulting Party within fifteen (15) days upon the issuance of the written notice, the Non-defaulting Party can take actions pursuant to this Agreement or other measures in accordance with applicable laws.

5.2 The occurrence of the following events constitutes a breach by Party B:

5.2.1 Any violation by Party B of the provisions of this Agreement, or the representation and warranties herein contain material mistakes, inaccuracies or are otherwise incorrect;

5.2.2 Transference in any manner, or the pledging of any rights pursuant to this Agreement without the prior written consent of Party A;

5.2.3 This Agreement and/or the Pledge Agreement becomes invalid or unenforceable.

5.3 Should a breach or violation of provisions under the Pledge Agreement and the Operating Agreement occur, Party A can request that Party B transfers all or part of Equity Interests to Party A or the Specified Person(s) pursuant to Article 1 hereof.

6.  Assignment

6.1 Without the prior written consent of Party A, Party B shall not transfer its rights and obligations under this Agreement to any third party; if Party B dies, Party B agrees to transfer the rights and obligations under this Agreement to a person approved by Party A.

6.2 This Agreement shall be binding on the successor to Party B and is effective on any successor or transferee that is allowed by Party A.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

6.3 Party B hereby agrees that Party A may transfer all of its rights and obligation under this Agreement to any third party subject to a written notice to Party B, and no further consent from Party B will be required.

7. Governing Law and Dispute Settlement

7.1 Governing Law

This Agreement shall be governed by and interpreted according to the laws of the PRC.

7.2 Dispute Settlement

With regard to any dispute in relation to the interpretation or implementation of this Agreement, the Parties shall negotiate in good faith to settle the dispute. If the dispute cannot be settled within thirty (30) days from the date any party issues written notice requesting settlement of a dispute through negotiation, each party has the right to submit the dispute to the China International Economic and Trade Arbitration Committee for arbitration according to its then effective arbitration rules. The arbitration shall be held in Beijing. The arbitration proceedings shall be conducted in Chinese. The arbitration award is final and binding on each party.

8. Tax and Expenses

Each party shall bear its own tax, costs and expenses in connection with this Agreement and the transactions contemplated herein.

9. Notice

Any notice or other communication under this Agreement shall be in Chinese and be sent to the address first written above or other address as may be designated from time to time by hand delivery or mail or facsimile. Any notice required or given hereunder shall be deemed to have been served: (a) on the same date if sent by hand delivery; (b) on the tenth date after posting if sent by air-mail, (c) on the fourth date if sent by the professional hand delivery which is acknowledged worldwide; and (d) the receipt date displayed on the transmission confirmation notice if sent by facsimile.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

10. Confidentiality

10.1 The parties acknowledge and confirm that any oral or written information relating to this Agreement that is communicated among the parties shall be deemed as confidential information (“Confidential Information”). The parties shall keep confidential such Confidential Information and shall not disclose such Confidential Information to any third party without the prior written consent of the other parties. The following information shall be excluded from the definition of Confidential Information: (a) information that is or becomes publicly available, so long as it is not disclosed by the party receiving such Confidential Information; or (b) information that is disclosed as required by applicable laws or regulations. In addition, without ceasing to be Confidential Information, a Party may disclose Confidential Information to its attorney or financial advisor so long as such attorney or financial advisor needs access to such information in order to ensure compliance with this Article and agrees to keep such information confidential. The disclosure by the employee or agent of each party shall be deemed disclosure by such party itself, and such party shall be liable therefor. The parties agree that the provisions of this Article shall survive notwithstanding the termination of this Agreement.

11. Further Assurance

11.1 The parties agree that each will, without any hesitation, execute any necessary documents and take any necessary actions for the purpose of performing the objectives of this Agreement and will execute any documents and take any actions which are beneficial for the purposes of this Agreement.

12. Miscellaneous

12.1 Amendment and Supplementation

Any revision, amendment or supplementation of this Agreement shall be in writing and be executed by each party.

12.2 Compliance with laws and regulations

The parties shall comply with all applicable laws and regulations which have been formally issued and may be publicly acquired.

12.3 Entire Agreement

Unless it is otherwise revised, amended or supplemented after execution, this Agreement constitutes the entire agreement among the parties as to the subject matter of this Agreement, and supersedes any prior oral or written negotiations, statements or agreements among the parties relating thereto.

12.4 Headings

Headings in this Agreement are only set out for reading convenience, and shall not be used to interpret, explain or otherwise influence the meaning of the provisions of this Agreement.

12.5 Severability

If any of the terms of this Agreement is declared invalid, illegal or unenforceable in accordance with any applicable laws or regulations, the validity and enforceability of the other terms hereof shall nevertheless remain unaffected, and the parties hereto agree to, through good faith negotiation, make valid terms to replace such invalid, illegal or unenforceable terms, and the economic results from such valid terms shall be close to, as much as may be possible, the superseded invalid, illegal or unenforceable terms.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

12.6 Successor

This Agreement shall be binding on the successor of each party or the transferee permitted by the other parties and shall be interpreted for its benefit.

12.7 Survival

12.7.1 Any obligations incurred in relation to this Agreement before its expiration or early termination shall continue to be effective after expiration or early termination of the Agreement.

12.7.2 The provisions of Articles 7, 10 and 12.7 shall survive notwithstanding the termination of this Agreement.

12.8 Waiver

Each party may waive the terms and conditions under this Agreement in writing. Such waiver document shall be effective only if it is duly signed by the party granting such waiver. Any waiver relating to the breach of the other party in certain circumstances shall not be deemed as a waiver for a similar breach in other circumstances.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

IN WITNESS WHEREOF, the Parties have executed this Agreement on the date first written above.

Party A:Putian Asia Success Cereals & Oils Technical Service Co., Ltd. [seal]
By:	/s/ Yao Jianshan
Name:	Yao Jianshan
Its:	Chief Executive Officer

Party B: Yao Jianshan

/s/ Yao Jianshan

Yao Jianshan

Party C: Fujian Grand Farm Foods Development Co., Ltd. [seal]
By:	/s/ Yao Jianshan
Name:	Yao Jianshan
Its:	Chief Executive Officer

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

Appendix A

Announcement Letter

Fujian Grand Farm Foods Development Co., Ltd. is a limited liability company duly established and valid existing under the PRC laws, of which (i) I hold a 0.25% equity interest and (ii) the other shareholder, Yao Jianshan, holds the remaining 99.75% equity interest. I hereby irrevocably waive any pre-emptive right I may have upon the other 99.75% equity interest held by the other shareholder and will not encumber the transfer of the equity interest you proposed.

This Announcement Letter is effective as of September 25, 2010.

/s/ Yao Jianxin

Yao Jianxin

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EX-10.4

EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

THIS EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT (the “Agreement”) is entered into by and among the following parties effective as of September 25, 2010.

Party A:Putian Asia Success Cereals & Oils Technical Service Co., Ltd, a wholly foreign-owned enterprise incorporated under the PRC laws with its registered address at No. 999, Houguo Street, Sanjiangkou Town, Hanjiang District, Putian City.

Party B: Yao Jianxin, a PRC citizen, with ID No. 350303197201280334

Address: Linbing Village, Guohuan Town, Hanjiang District, Putian City

Party C: Fujian Grand Farm Foods Development Co., Ltd. a limited liability company duly established and validly existing under the laws of the PRC, with its registered address atNo. 2089, Hanhua East Road, Guohuan Town, Hanjiang District, Putian City.

WHEREAS,

1. Party B holds a 0.25% equity interest in Party C; and

2. Party A and Party C have entered into an Exclusive Technical Consulting Service Agreement and an Operating Agreement, both dated as of September 25, 2010.

NOW THEREFORE, intending to be bound hereby, the Parties hereto agree as follows:

1. Transfer of Equity Interest

1.1 Grant of Purchase Right

Party B hereby irrevocably grants Party A the exclusive right to purchase or designate one or more persons (each a “Specified Person”) to purchase all or any portion of the 0.25% equity interest in Party C held by Party B (the “Equity Interest”), subject to compliance with legal restrictions under applicable PRC laws (the “Purchase Right”). Party B shall not sell or transfer all or any portion of the Equity Interest to any party other than Party A and/or the Specified Person(s). Party C hereby agrees that Party B may grant the Purchase Right to Party A, and the other shareholders of Party C hereby waive any and all preemptive rights relating to the Equity Interest evidenced by the Announcement document attached hereto as the Appendix. The term “person” as used herein means an individual, corporation, joint enterprise, partnership, enterprise, trust or non-corporation organization.

1.2 Exercise of the Purchase Right

1.2.1 To the extent permitted under PRC laws, Party A, at its sole discretion, may decide the specific time, method and number of its exercise.

 

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

1.2.2 When Party A intends to exercise the Purchase Right, it shall issue a written notice (the “Purchase Notice”) to Party B, and the Purchase Notice shall state the following: (a) Party A intends to exercise the Purchase Right; (b) the percentage of the Equity Interest to be purchased therewith; and (c) the effective date or transfer date. Party A may exercise the Purchase Right one or more times, in whole or in part.

1.3 Consideration of the Equity Interest

The Transfer Fee (“Transfer Fee”) payable by Party A shall be confirmed by both Party A and Party B through negotiation according to the evaluation of the Equity Interest by the relevant qualified institute, and it shall be the lowest price allowable by the PRC laws and regulations.

1.4 Transfer of the Equity Interest

Each time Party A exercises the Purchase Right in whole or in part:

1.4.1 Party B shall ensure that Party C timely convenes a shareholders’ meeting, at which the shareholders of Party C shall pass shareholders’ resolutions providing that Party B can transfer to Party A or the Specified Person(s) the Equity Interest as specified in the Purchase Notice.

1.4.2 Party B shall enter into a transfer agreement with Party A or the Specified Person(s) in relation to the Equity Interest to be transferred pursuant to the Purchase Notice.

1.4.3 The Parties shall execute all other agreements or documents, obtain all government approvals and consents, and take all actions necessary to legally transfer the ownership of the Equity Interest as specified in the Purchase Notice to Party A or the Specified Person(s) and ensure that Party A or the Specified Person will be registered as the owner of such Equity Interest. Such Equity Interest shall be free from any Security Interest or other encumbrance. For the purposes of this Agreement, “Security Interest” shall include any guarantee, mortgage, third party rights or interest, purchase rights, preemption rights, offset rights and any other security arrangements, but shall exclude any security interest granted in accordance with this Agreement and the Equity Interest Pledge Agreement entered into by and between Party B and Party A effective as of September 25, 2010 (the “Pledge Agreement”).

1.4.4 Party B and Party C shall unconditionally assist Party A in obtaining the governmental approvals, permits, registrations, filings and completing all the necessary formalities for obtaining the Equity Interest to be transferred pursuant to the Purchase Notice.

1.5 Payment for the Equity Interest

1.5.1 Party A shall pay the Transfer Fee to Party B in accordance with the provision of Article 1.3.

2. Covenants Relating to the Equity Interest

2.1 Covenants of Party C

2.1.1 Without the prior written consent of Party A, Party C will not supplement, amend, or modify any provisions of the charter and organizational documents of Party C and will not increase or reduce its registered capital or change the equity holding structures in any other way.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

2.1.2 Party C shall remain legally existing, in good standing, will prudently and efficiently operate its business and deal with corporate affairs in accordance with commercial standards and practice.

2.1.3 Without the prior written consent of Party A, Party C shall not sell, transfer, mortgage or dispose of any assets, business or beneficial rights of Party C, or allow any creation of another security interest or other encumbrance upon its assets.

2.1.4 Without the prior written consent of Party A, Party C shall not incur, inherit, or guarantee any debts except for (i) debt incurred during the course of normal business operations (excluding business loans); and (ii) the debt that has been previously disclosed to Party A and to which Party A has provided prior written consent.

2.1.5 Party C shall operate its business normally to maintain the value of its assets, and shall not take any action which shall bring any materially adverse influence upon the business operation or the value of the assets.

2.1.6 Without the prior written consent of Party A, Party C shall not enter into any material agreement except in the normal course of business. (For the purpose of this paragraph, an agreement covering an amount in excess of RMB 100,000 will be considered a material agreement).

2.1.7 Without the prior written consent of Party A, Party C shall not provide any loans or credit to any third party.

2.1.8 At Party A’s request, Party C shall provide Party A with any materials relating to the business operation and financial status of Party C.

2.1.9 Party C shall purchase insurance from an insurance company acceptable to Party A and shall maintain such insurance. The amount and kinds of such insurance shall be similar to insurance carried by other companies which operate similar businesses and possess similar assets.

2.1.10 Without the prior written consent of Party A, Party C shall not merge with, combine with, make investment in, purchase the equity or substantially all the assets of any other entity.

2.1.11 Within 24 hours after receiving notice or becoming aware thereof, Party C shall inform Party A of any actual or potential litigation, arbitration, or administrative procedure in relation to the Equity Interest.

2.1.12 In order to keep the ownership of all assets, Party C shall execute all necessary or proper documents, take all necessary or proper actions, substitute all necessary or proper claims, and make all necessary or proper answers to all compensation claims.

2.1.13 Without the prior written consent of Party A, Party C shall not allot any dividend to any shareholder. However, Party C shall immediately allot all dividends to the shareholders upon the request of Party A.

2.2 Covenants of Party B

2.2.1 Without the prior written consent of Party A, Party B shall not sell, transfer, mortgage or dispose of any rights or interest relating to the Equity Interest, or allow any creation of other security interests or encumbrances on the Equity Interest (excluding the Security Interest under this Agreement and the Pledge Agreement).

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

2.2.2 Party B shall use its best efforts to prevent the other shareholders of Party C from approving resolutions relating to the sale, transfer, mortgage, or disposal of any rights or interests relating to the Equity Interest, or allowing any creation of any security interest or other encumbrance on the Equity Interest (excluding the Security Interest created pursuant to this Agreement and the Equity Interest Pledge Agreement).

2.2.3 Party B shall use its best efforts to prevent the other shareholders of Party C from approving resolutions relating to Party C’s merger with, combination with, purchase of, or investment in any other entity.

2.2.4 Party B shall inform Party A of any actual or potential litigation, arbitration, or administrative procedure in relation to the Equity Interest.

2.2.5 Party B shall ensure that the other shareholders of Party C approve the transfer of the Equity Interest as set out in this Agreement.

2.2.6 In order to keep ownership of the Equity Interest, Party B shall cause Party C to execute all necessary or proper documents, take all necessary or proper actions, substitute all necessary or proper claims, and make all necessary or proper answer to all compensation claims.

2.2.7 At the request of Party A from time to time, Party B shall immediately transfer to Party A or the Specified Person(s) the Equity Interest pursuant to this Agreement.

2.2.8 Party B shall strictly comply with this Agreement and any other agreements which may be entered into by and among Party B, Party C and Party A collectively or separately, and shall perform its obligations under such agreements, and shall not take or fail to take any actions which actions or inactions will affect the validity and enforceability of such agreements.

3. Representations and Warranties

3.1 Party B and Party C jointly and severally represent and undertake as follows:

3.1.1 Each such party has the power to enter into and deliver this Agreement and such other agreements for the transfer of the Equity Interest to Party A or the Designated Person(s), and has the power and capacity to perform its obligations under this Agreement.

3.1.2 Neither the execution and delivery of this Agreement, nor the performance of the obligations under this Agreement will: (i) violate any PRC laws; (ii) conflict with the Articles of Association or other organizational documents of any party; (iii) breach any contract or document which such Party is a party to or which binds such Party; (iv) violate any required permit, approval or any valid qualification; or (v) result in the cessation, revocation or imposition of additional conditions on the required permit, approval or qualification.

3.1.3 Party C has full and transferable ownership of its assets and facilities. Other than the pledge and/or mortgage incurred by this Agreement and the pledge of the Equity Interest pursuant to the Pledge Agreement, there is no other pledge and/or mortgage on such assets and facilities.

3.1.4 Party C has no outstanding debt except for (i) the legal debt, incurred during the normal course of business; and (ii) the debt that has been previously disclosed to Party A.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

3.1.5 Party C complies with all applicable laws and regulations.

3.1.6 There is no actual, pending or potential litigation, arbitration, or administrative procedure in relation to the Equity Interest, assets of Party C or other matters relating to Party C.

4. Effectiveness and Term of this Agreement

4.1 This Agreement shall be executed and come into effect as of the date first set forth above. This Agreement shall expire on the date that is 50 years following the date hereof unless earlier terminated as set forth in this Agreement or upon mutual agreement of the Parties hereto.

4.2 This Agreement may be unilaterally extended prior to termination for a successive 50 year term upon written notice by Party A, provided such extension is permitted by law and subject to the approval of the registration administration for the extension of Party C’s business duration. The parties will cooperate to renew this Agreement upon such notice by Party A if such renewal is legally permitted at the time.

5. Breach of Contract

5.1 If any party (the “Defaulting Party”) breaches any provision of this Agreement, which may cause damages to other parties (each a “Non-defaulting Party”), the Non-defaulting Party can notify the Defaulting Party in writing to rectify and correct such breach; if the Defaulting Party does not take actions which rectify and correct such breach to the satisfaction of the Non-defaulting Party within fifteen (15) days upon the issuance of the written notice, the Non-defaulting Party can take actions pursuant to this Agreement or other measures in accordance with applicable laws.

5.2 The occurrence of the following events constitutes a breach by Party B:

5.2.1 Any violation by Party B of the provisions of this Agreement, or the representation and warranties herein contain material mistakes, inaccuracies or are otherwise incorrect;

5.2.2 Transference in any manner, or the pledging of any rights pursuant to this Agreement without the prior written consent of Party A;

5.2.3 This Agreement and/or the Pledge Agreement becomes invalid or unenforceable.

5.3 Should a breach or violation of provisions under the Pledge Agreement and the Operating Agreement occur, Party A can request that Party B transfers all or part of Equity Interests to Party A or the Specified Person(s) pursuant to Article 1 hereof.

6. Assignment

6.1 Without the prior written consent of Party A, Party B shall not transfer its rights and obligations under this Agreement to any third party; if Party B dies, Party B agrees to transfer the rights and obligations under this Agreement to a person approved by Party A.

6.2 This Agreement shall be binding on the successor to Party B and is effective on any successor or transferee that is allowed by Party A.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

6.3 Party B hereby agrees that Party A may transfer all of its rights and obligation under this Agreement to any third party subject to a written notice to Party B, and no further consent from Party B will be required.

7. Governing Law and Dispute Settlement

7.1 Governing Law

This Agreement shall be governed by and interpreted according to the laws of the PRC.

7.2 Dispute Settlement

With regard to any dispute in relation to the interpretation or implementation of this Agreement, the Parties shall negotiate in good faith to settle the dispute. If the dispute cannot be settled within thirty (30) days from the date any party issues written notice requesting settlement of a dispute through negotiation, each party has the right to submit the dispute to the China International Economic and Trade Arbitration Committee for arbitration according to its then effective arbitration rules. The arbitration shall be held in Beijing. The arbitration proceedings shall be conducted in Chinese. The arbitration award is final and binding on each party.

8.    Tax and Expenses

Each party shall bear its own tax, costs and expenses in connection with this Agreement and the transactions contemplated herein.

9.    Notice

Any notice or other communication under this Agreement shall be in Chinese and be sent to the address first written above or other address as may be designated from time to time by hand delivery or mail or facsimile. Any notice required or given hereunder shall be deemed to have been served: (a) on the same date if sent by hand delivery; (b) on the tenth date after posting if sent by air-mail, (c) on the fourth date if sent by the professional hand delivery which is acknowledged worldwide; and (d) the receipt date displayed on the transmission confirmation notice if sent by facsimile.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

10. Confidentiality

10.1 The parties acknowledge and confirm that any oral or written information relating to this Agreement that is communicated among the parties shall be deemed as confidential information (“Confidential Information”). The parties shall keep confidential such Confidential Information and shall not disclose such Confidential Information to any third party without the prior written consent of the other parties. The following information shall be excluded from the definition of Confidential Information: (a) information that is or becomes publicly available, so long as it is not disclosed by the party receiving such Confidential Information; or (b) information that is disclosed as required by applicable laws or regulations. In addition, without ceasing to be Confidential Information, a Party may disclose Confidential Information to its attorney or financial advisor so long as such attorney or financial advisor needs access to such information in order to ensure compliance with this Article and agrees to keep such information confidential. The disclosure by the employee or agent of each party shall be deemed disclosure by such party itself, and such party shall be liable therefor. The parties agree that the provisions of this Article shall survive notwithstanding the termination of this Agreement.

11. Further Assurance

11.1 The parties agree that each will, without any hesitation, execute any necessary documents and take any necessary actions for the purpose of performing the objectives of this Agreement and will execute any documents and take any actions which are beneficial for the purposes of this Agreement.

12. Miscellaneous

12.1  Amendment and Supplementation

Any revision, amendment or supplementation of this Agreement shall be in writing and be executed by each party.

12.2  Compliance with laws and regulations

The parties shall comply with all applicable laws and regulations which have been formally issued and may be publicly acquired.

12.3  Entire Agreement

Unless it is otherwise revised, amended or supplemented after execution, this Agreement constitutes the entire agreement among the parties as to the subject matter of this Agreement, and supersedes any prior oral or written negotiations, statements or agreements among the parties relating thereto.

12.4  Headings

Headings in this Agreement are only set out for reading convenience, and shall not be used to interpret, explain or otherwise influence the meaning of the provisions of this Agreement.

12.5  Severability

If any of the terms of this Agreement is declared invalid, illegal or unenforceable in accordance with any applicable laws or regulations, the validity and enforceability of the other terms hereof shall nevertheless remain unaffected, and the parties hereto agree to, through good faith negotiation, make valid terms to replace such invalid, illegal or unenforceable terms, and the economic results from such valid terms shall be close to, as much as may be possible, the superseded invalid, illegal or unenforceable terms.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

12.6  Successor

This Agreement shall be binding on the successor of each party or the transferee permitted by the other parties and shall be interpreted for its benefit.

12.7  Survival

12.7.1 Any obligations incurred in relation to this Agreement before its expiration or early termination shall continue to be effective after expiration or early termination of the Agreement.

12.7.2 The provisions of Articles 7, 10 and 12.7 shall survive notwithstanding the termination of this Agreement.

12.8Waiver

Each party may waive the terms and conditions under this Agreement in writing. Such waiver document shall be effective only if it is duly signed by the party granting such waiver. Any waiver relating to the breach of the other party in certain circumstances shall not be deemed as a waiver for a similar breach in other circumstances.

[The remainder of this page is intentionally left blank]

IN WITNESS WHEREOF, the Parties have executed this Agreement on the date first written above.

Party A:Putian Asia Success Cereals & Oils Technical Service Co., Ltd. [seal]
By:	/s/ Yao Jianshan
Name:	Yao Jianshan
Its:	Chief Executive Officer

Party B: Yao Jianxin

/s/ Yao Jianxin

Yao Jianxin

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

Party C: Fujian Grand Farm Foods Development Co., Ltd. [seal]
By:	/s/ Yao Jianshan
Name:	Yao Jianshan
Its:	Chief Executive Officer

Appendix A

Announcement Letter

Fujian Grand Farm Foods Development Co., Ltd. is a limited liability company duly established and valid existing under the PRC laws, of which (i) I hold a 99.75% equity interest and (ii) the other shareholder, Yao Jianxin, holds the remaining 0.25% equity interest. I hereby irrevocably waive any pre-emptive right I may have upon the other 0.25% equity interest held by the other shareholder and will not encumber the transfer of the equity interest you proposed.

This Announcement Letter is effective as of September 25, 2010.

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EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT

 

/s/ Yao Jianshan

Yao Jianshan

Page 10 of 10

EX-10.5

EQUITY INTEREST PLEDGE AGREEMENT

EQUITY INTEREST PLEDGE AGREEMENT

THIS EQUITY INTEREST PLEDGE AGREEMENT (this “Agreement”) is made and entered into by and among the following parties on September 25, 2010 in Fujian, the People’s Republic of China (“China” or the “PRC”):

Party A: Putian Asia Success Cereals & Oils Technical Service Co., Ltd

Registered address: No. 999, Houguo Street, Sanjiangkou Town, Hanjiang District, Putian City

Party B:   Yao Jianshan  

ID No.: 350303690720035

Address: Linbing Village, Guohuan Town, Hanjiang District, Putian City

Party C: Fujian Grand Farm Foods Development Co., Ltd.

Registered Address: No. 2089, Hanhua East Road, Guohuan Town, Hanjiang District, Putian City

In this Agreement, each of Party A, Party B and Party C shall be referred to as a "Party" respectively, and they shall be collectively referred to as the "Parties".

WHEREAS:

1. Party A is a wholly foreign-owned enterprise duly established and validly existing under the laws of the PRC. Party A and Party C entered into an Exclusive Technical Consulting Service Agreement effective as of September 25, 2010 (the “Service Agreement”).

2. Party B, a citizen of the PRC, holds a 99.75 % equity interest in Party C (the “Equity Interest”), which is a limited liability company duly established and validly existing in Fujian under the laws of the PRC. Party C acknowledges the respective rights and obligations of Party A and Party B under this Agreement;

3. Pursuant to the Service Agreement, Party C shall pay a certain fee to Party A in consideration of the consulting services provided by Party A thereunder (the “Consulting Fee”). In order to ensure Party C’s performance of its obligations under the Service Agreement, including payment of the Consulting Fee, Party B is willing to pledge all of the Equity Interest to Party A as security.

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EQUITY INTEREST PLEDGE AGREEMENT

NOW THEREFORE, through mutual discussion, the Parties have agreed as follows:

Article 1 Definitions

Unless it is otherwise stipulated, for the purpose of this Agreement, the following terms shall have the following meanings:

1.1 “Event of Default” means any event in accordance with Article 7 hereunder.

1.2 “Equity Interest” means the 99.75 % equity interest in Party C legally held by Party B and any other equity interest in Party C which may be held by Party B in the future.

1.3 “Force Majeure Event” means any event that is out of the control of each party and that would be unavoidable or insurmountable even if the party affected by such event paid reasonable attention to it. Force Majeure Event shall include, but not be limited to government actions, natural disasters, fire, explosion, typhoons, floods, earthquakes, tide, lightning and war. However, any lack of credit, assets or financing shall not be deemed to be a Force Majeure Event.

1.4 “Notice of Default” means the notice of default issued by Party A in accordance with this Agreement declaring an Event of Default.

1.5 “Pledge” means the security interest granted by Party A to Party B pursuant to Article 2 of this Agreement, i.e., the right of Party A to be compensated on a preferential basis with the conversion, auction or sales price of the Equity Interest.

1.6 “Service Agreement” means the Exclusive Technical Consulting and Service Agreement entered into by and between Party A and Party C on September 25, 2010.

1.7 “Consulting Fee” means the fee that Party C is obligated to pay Party A in consideration of the consulting services provided by Party A pursuant to the Service Agreement.

1.8 “Term of the Pledge” means the term in accordance with Article 3 hereunder.

Article 2 Pledge

2.1 As collateral security for Party C’s prompt and complete performance when due (whether at stated maturity, by acceleration or otherwise) of its obligations under the Service Agreement, including without limitation the Consulting Fee, Party B hereby pledges to Party A a first security interest in all of Party B's right, title and interest in the Equity Interest, whether now owned or hereafter acquired by Party B.

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EQUITY INTEREST PLEDGE AGREEMENT

Article 3 Term of Pledge

3.1 The Pledge shall be effective as of the date that the Pledge is recorded in the register of shareholders of Party C and shall remain effective so long as this Agreement remains in effect.

3.2 During the Term of the Pledge, Party A shall be entitled to foreclose on the Pledge in accordance with this Agreement in the event that Party C fails to perform any of its obligations under the Service Agreement, including without limitation the payment of the Consulting Fee.

3.3 Except as otherwise provided hereunder, Party A shall be entitled to exercise, dispose of or assign the Pledge in accordance with this Agreement.

Article 4 Physical Possession of Documents

4.1 During the Term of the Pledge, Party A shall be entitled to possess the contribution certificate of the Equity Interest (the “Contribution Certificate”) and the register of shareholders of Party C. Party B shall deliver the Contribution Certificate and the register of shareholders hereunder to Party A within one week after the execution date of this Agreement.

Party A shall be entitled to collect 15% of Party C’s annual net profit from the Equity Interest during the term of the Pledge.

4.2

Article 5 Representations and Warranties of Party B

5.1 Party B is the legal owner of the Equity Interest.

5.2 Except as otherwise provided hereunder, Party A shall not be interfered with by any parties at any time when Party A is exercising its rights in accordance with this Agreement.

5.3 Except as otherwise provided hereunder, Party A shall be entitled to exercise, dispose of or assign the Pledge in accordance with this Agreement.

5.4 Party B has not pledged to any other person or otherwise encumbered the Equity Interest except to Party A.

Article 6 Covenant of Party B

6.1 During the effective term of this Agreement, Party B covenants to Party A as follows:

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EQUITY INTEREST PLEDGE AGREEMENT

6.1.1 Except for the transfer of the Equity Interest pursuant to that certain Exclusive Equity Interest Purchase Agreement entered into by and between Party B and Party A, Party B shall not transfer or assign the Equity Interest, or create or permit to create any pledges which may have an adverse effect on the rights or benefits of Party A without prior written consent from Party A.

6.1.2 Party B shall comply with and implement all laws and regulations with respect to the right of pledge, shall present to Party A any notices, orders or suggestions with respect to the Pledge issued or made by the competent authority after receiving such notices, orders or suggestions and shall comply with such notices, orders or suggestions, or object to the foregoing matters at the reasonable request of Party A or with the written consent of Party A.

6.1.3 Party B shall timely notify Party A of any events or the receipt of any notices which may affect the Equity Interest or any part of its rights thereto, which may change any of Party B’s covenants and obligations under this Agreement or which may affect Party B’s performance of its obligations under this Agreement.

6.2 Party B shall complete the pledge registration at the competent administration for industry and commerce where Party C is located pursuant to this Agreement once such registration procedure is available.

6.3 Party B agrees that Party A’s right to exercise the Pledge shall not be suspended or hampered through legal procedure by Party B, any successors of Party B or any person authorized by Party B.

6.4 Party B warrants to Party A that in order to protect or perfect the security over the payment of the Consulting Fee under the Service Agreement, Party B shall execute in good faith to execute all title certificates, contracts or other documents, and/or perform and cause other parties who have any interest to take action as required by Party A and provide access to exercise the rights and authorization vested in Party A under this Agreement, and execute all the documents with respect to the Equity Interest and promptly provide all the notices, orders and decisions deemed necessary by Party A to Party A within a reasonable time.

6.5 Party B warrants to Party A that Party B will comply with and perform all the guarantees, covenants, agreements, representations and conditions herein for the benefit of Party A. Party B shall indemnify Party A for all the losses suffered by Party A in the event that Party B does not perform or fully perform such guarantees, covenants, agreements, representations or conditions.

Article 7 Events of Default

7.1 The occurrence of any of the events listed below shall be deemed an Event of Default:

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EQUITY INTEREST PLEDGE AGREEMENT

7.1.1 Party C fails to make full payment of the Consulting Fee as required under the Service Agreement.

7.1.2 Party B makes any misleading or fraudulent representations or warranties under Article 5 herein, and/or Party B violates any warranties under Article 5 herein.

7.1.3 Party B violates any of the covenants under Article 6 herein.

7.1.4 Party B violates any terms or conditions herein.

7.1.5 Party B waives, transfers or assigns the pledged Equity Interest without the prior written consent of Party A, except as provided by Article 6.1.1 herein.

7.1.6 Any external loan, security, compensation, covenant or other compensation liability of Party B (1) is required to be repaid or performed prior to its scheduled date; or (2) is due but is not repaid or performed as scheduled.

7.1.7 Party B is incapable of repaying its general debt or other debt.

7.1.8 Party A determines that the performance of this Agreement is illegal for any reason.

7.1.9 Any approval, permit or authorization needed to perform this Agreement or to validate this Agreement is withdrawn, suspended, invalidated or materially revised.

7.1.10 The property of Party B adversely changes and causes Party A to conclude that the capability of Party B to perform the obligations herein under this Agreement is impaired.

7.1.11 The successors or assigns of Party C are only entitled to perform a portion of or refuse to perform the payment obligations under the Service Agreement.

7.1.12 Other circumstances whereby Party A determines that its rights hereunder have been impaired.

7.2 Party B shall immediately notify Party A in writing if Party B becomes aware of or finds that any event under Article 7.1 herein or any event that may result in an Event of Default has occurred or is occurring.

7.3 Unless the Event of Default under Article 7.1 herein has been remedied to Party A’s sole and absolute satisfaction, Party A may, at any time during the Event of Default, immediately give a written Notice of Default to Party B requiring Party B to make immediate full payment of the then outstanding Consulting Fee under the Service Agreement and other payables or foreclose on the Pledge in accordance with Article 8 herein.

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EQUITY INTEREST PLEDGE AGREEMENT

Article 8 Exercise of the Right of Pledge

8.1 Prior to the full satisfaction by Party C of its obligations under the Service Agreement, including without limitations the full payment of the Consulting Fee, Party B shall not transfer or assign the Equity Interest without prior written approval from Party A.

8.2 Party A shall give Notice of Default to Party B when Party A exercises its right to foreclose on the Pledge.

8.3 Subject to Article 7.3, Party A may exercise the right to foreclose on the Pledge at any time provided Party A gives the Notice of Default pursuant to Article 7.3.

8.4 Party A is entitled to have priority in receiving payment or proceeds from the auction or sale of all or part of the Equity Interest pledged herein in accordance with applicable law until the Consulting Fee and all other payables under the Service Agreement are fully paid.

8.5 Party B shall not hinder Party A from foreclosing on the Pledge in accordance with this Agreement and shall give necessary assistance so that Party A may effectively realize the value of the Equity Interest.

Article 9 Transfer or Assignment

9.1 Party B shall not transfer or assign any rights or obligations herein without the prior written consent of Party A, which shall be in Party A’s sole and absolute discretion. Party B understands that any transferee or assignee shall be required to be bound hereby.

9.2 Party A may transfer or assign all or any rights and obligations under the Service Agreement to any person (natural person or legal entity) at any time without the consent of Party B. Any transferee or assignee shall enjoy and undertake the same rights and obligations herein of Party A as if the assignee were a party hereto. If Party A transfers or assigns the rights and obligations under the Service Agreement, the Service Agreement will continue in full force and effect without need for execution of further documents.

9.3 This Agreement shall be binding upon and inure to the benefit of Party A and its successors and assigns and shall be effective as to Party B and any of its permitted successors and assigns.

Article 10 Termination

10.1 This Agreement shall remain in full force and effect so long as the Service Agreement remains in effect.

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EQUITY INTEREST PLEDGE AGREEMENT

Article 11 Formalities Fees and Other Expenses

11.1 Party B shall be responsible for all the fees and actual expenditures in relation to this Agreement, including but not limited to, legal fees, stamp tax and any other taxes and charges. If Party A pays any such fees on behalf of Party B, Party B shall promptly reimburse Party A in full. Nothing in the foregoing sentence shall be construed to require Party A to pay any such fees.

11.2 Party B shall be responsible for all the fees, including but not limited to, any taxes, formalities fees, management fees, litigation fees, attorneys’ fees, and various insurance premiums in connection with disposition of the pledged Equity Interest incurred by Party B by virtue of Party B’s failure to pay any taxes, fees or charges in accordance with this Agreement.

Article 12 Force Majeure

12.1 If the fulfillment of this Agreement is delayed or blocked due to a Force Majeure Event, the Party affected by such a Force Majeure Event shall be free from any obligation to the extent of the delay or holdback. The Party claiming the occurrence of a Force Majeure Event shall provide the other party with the steps of fulfilling the obligations of this Agreement.

12.2 Performance under this Agreement shall be suspended during the existence of such Force Majeure Event, provided the Party claiming the existence of the Force Majeure Event has notified the other Party of the existence of such Force Majeure Event and has used reasonable best efforts to perform under the Agreement. Both Parties agree to use reasonable best efforts to resume performance of this Agreement if the reason for exemption has been corrected or remedied.

Article 13Governing Law and Dispute Settlement

13.1 The execution, effectiveness, construction, performance, amendment and termination of this Agreement and the resolution of disputes hereunder shall be governed by the laws of China.

13.2 The Parties shall strive to settle any dispute arising from the interpretation or performance of this Agreement through mutual agreement and negotiation. In case no settlement can be reached through consultation, each Party can submit such matter to the China International Economic and Trade Arbitration Committee for arbitration according its then effective arbitration rules. The arbitration shall be held in Beijing. The arbitration proceedings shall be conducted in Chinese. The arbitration award shall be final and binding upon the Parties. The arbitration award may be submitted to the applicable PRC court for enforcement.

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EQUITY INTEREST PLEDGE AGREEMENT

Article 14 Notices

14.1 Any notice or other communication under this Agreement shall be in Chinese and be sent to the address first written above or other address as may be designated from time to time by hand delivery or mail or facsimile. Any notice required or given hereunder shall be deemed to have been served: (a) on the same date if sent by hand delivery; (b) on the tenth date after posting if sent by air-mail, (c) on the fourth date if sent by professional hand delivery which is acknowledged worldwide; and (d) the receipt date displayed on the transmission confirmation notice if sent by facsimile.

Article 15 Appendix

15.1 The Appendix of this Agreement as attached hereto is the part of this Agreement.

Article 16 Effectiveness

16.1 This Agreement is effective as of the date above first written. Any amendments, supplements and modifications shall be in writing and shall be effective upon execution by the Parties thereto.

[THIS SPACE IS INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the Parties have caused their authorized representatives to execute this Agreement as of the date first written above.

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EQUITY INTEREST PLEDGE AGREEMENT

Party A: Putian Asia Success Cereals & Oils Technical Service Co., Ltd [seal]

By:	/s/ Yao Jianshan
Name: Yao Jianshan
Its:       Chief Executive Officer

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EQUITY INTEREST PLEDGE AGREEMENT

Party B: Yao Jianshan

/s/ Yao Jianshan

Yao Jianshan

Page 10 of 11

EQUITY INTEREST PLEDGE AGREEMENT

Party C: Fujian Grand Farm Foods Development Co., Ltd. [seal]
By:	/s/ Yao Jianshan
Name:	Yao Jianshan
Its:	Chief Executive Officer

Page 11 of 11

EX-10.6

EQUITY INTEREST PLEDGE AGREEMENT

EQUITY INTEREST PLEDGE AGREEMENT

THIS EQUITY INTEREST PLEDGE AGREEMENT (this “Agreement”) is made and entered into by and among the following parties on September 25, 2010 in Fujian, the People’s Republic of China (“China” or the “PRC”):

Party A: Putian Asia Success Cereals & Oils Technical Service Co., Ltd

Registered address: No. 999, Houguo Street, Sanjiangkou Town, Hanjiang District, Putian City

Party B:   Yao Jianxin  

ID No.: 350303197201280334

Address: Linbing Village, Guohuan Town, Hanjiang District, Putian City

Party C: Fujian Grand Farm Foods Development Co., Ltd.

Registered Address: No. 2089, Hanhua East Road, Guohuan Town, Hanjiang District, Putian City

In this Agreement, each of Party A, Party B and Party C shall be referred to as a "Party" respectively, and they shall be collectively referred to as the "Parties".

WHEREAS:

1. Party A is a wholly foreign-owned enterprise duly established and validly existing under the laws of the PRC. Party A and Party C entered into an Exclusive Technical Consulting Service Agreement effective as of September 25, 2010 (the “Service Agreement”).

2. Party B, a citizen of the PRC, holds a 0.25 % equity interest in Party C (the “Equity Interest”), which is a limited liability company duly established and validly existing in Fujian under the laws of the PRC. Party C acknowledges the respective rights and obligations of Party A and Party B under this Agreement;

3. Pursuant to the Service Agreement, Party C shall pay a certain fee to Party A in consideration of the consulting services provided by Party A thereunder (the “Consulting Fee”). In order to ensure Party C’s performance of its obligations under the Service Agreement, including payment of the Consulting Fee, Party B is willing to pledge all of the Equity Interest to Party A as security.

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EQUITY INTEREST PLEDGE AGREEMENT

NOW THEREFORE, through mutual discussion, the Parties have agreed as follows:

 

Article 1 Definitions

Unless it is otherwise stipulated, for the purpose of this Agreement, the following terms shall have the following meanings:

1.1 “Event of Default” means any event in accordance with Article 7 hereunder.

1.2 “Equity Interest” means the 0.25 % equity interest in Party C legally held by Party B and any other equity interest in Party C which may be held by Party B in the future.

1.3 “Force Majeure Event” means any event that is out of the control of each party and that would be unavoidable or insurmountable even if the party affected by such event paid reasonable attention to it. Force Majeure Event shall include, but not be limited to government actions, natural disasters, fire, explosion, typhoons, floods, earthquakes, tide, lightning and war. However, any lack of credit, assets or financing shall not be deemed to be a Force Majeure Event.

1.4 “Notice of Default” means the notice of default issued by Party A in accordance with this Agreement declaring an Event of Default.

1.5 “Pledge” means the security interest granted by Party A to Party B pursuant to Article 2 of this Agreement, i.e., the right of Party A to be compensated on a preferential basis with the conversion, auction or sales price of the Equity Interest.

1.6 “Service Agreement” means the Exclusive Technical Consulting and Service Agreement entered into by and between Party A and Party C on September 25, 2010.

1.7 “Consulting Fee” means the fee that Party C is obligated to pay Party A in consideration of the consulting services provided by Party A pursuant to the Service Agreement.

1.8 “Term of the Pledge” means the term in accordance with Article 3 hereunder.

Article 2 Pledge

2.1 As collateral security for Party C’s prompt and complete performance when due (whether at stated maturity, by acceleration or otherwise) of its obligations under the Service Agreement, including without limitation the Consulting Fee, Party B hereby pledges to Party A a first security interest in all of Party B's right, title and interest in the Equity Interest, whether now owned or hereafter acquired by Party B.

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EQUITY INTEREST PLEDGE AGREEMENT

Article 3 Term of Pledge

3.1 The Pledge shall be effective as of the date that the Pledge is recorded in the register of shareholders of Party C and shall remain effective so long as this Agreement remains in effect.

3.2 During the Term of the Pledge, Party A shall be entitled to foreclose on the Pledge in accordance with this Agreement in the event that Party C fails to perform any of its obligations under the Service Agreement, including without limitation the payment of the Consulting Fee.

3.3 Except as otherwise provided hereunder, Party A shall be entitled to exercise, dispose of or assign the Pledge in accordance with this Agreement.

Article 4 Physical Possession of Documents

4.1 During the Term of the Pledge, Party A shall be entitled to possess the contribution certificate of the Equity Interest (the “Contribution Certificate”) and the register of shareholders of Party C. Party B shall deliver the Contribution Certificate and the register of shareholders hereunder to Party A within one week after the execution date of this Agreement.

Party A shall be entitled to collect 15% of Party C’s annual net profit from the Equity Interest during the term of the Pledge.

4.2

Article 5 Representations and Warranties of Party B

5.1 Party B is the legal owner of the Equity Interest.

5.2 Except as otherwise provided hereunder, Party A shall not be interfered with by any parties at any time when Party A is exercising its rights in accordance with this Agreement.

5.3 Except as otherwise provided hereunder, Party A shall be entitled to exercise, dispose of or assign the Pledge in accordance with this Agreement.

5.4 Party B has not pledged to any other person or otherwise encumbered the Equity Interest except to Party A.

Article 6 Covenant of Party B

6.1 During the effective term of this Agreement, Party B covenants to Party A as follows:

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EQUITY INTEREST PLEDGE AGREEMENT

6.1.1 Except for the transfer of the Equity Interest pursuant to that certain Exclusive Equity Interest Purchase Agreement entered into by and between Party B and Party A, Party B shall not transfer or assign the Equity Interest, or create or permit to create any pledges which may have an adverse effect on the rights or benefits of Party A without prior written consent from Party A.

6.1.2 Party B shall comply with and implement all laws and regulations with respect to the right of pledge, shall present to Party A any notices, orders or suggestions with respect to the Pledge issued or made by the competent authority after receiving such notices, orders or suggestions and shall comply with such notices, orders or suggestions, or object to the foregoing matters at the reasonable request of Party A or with the written consent of Party A.

6.1.3 Party B shall timely notify Party A of any events or the receipt of any notices which may affect the Equity Interest or any part of its rights thereto, which may change any of Party B’s covenants and obligations under this Agreement or which may affect Party B’s performance of its obligations under this Agreement.

6.2 Party B shall complete the pledge registration at the competent administration for industry and commerce where Party C is located pursuant to this Agreement once such registration procedure is available.

6.3 Party B agrees that Party A’s right to exercise the Pledge shall not be suspended or hampered through legal procedure by Party B, any successors of Party B or any person authorized by Party B.

6.4 Party B warrants to Party A that in order to protect or perfect the security over the payment of the Consulting Fee under the Service Agreement, Party B shall execute in good faith to execute all title certificates, contracts or other documents, and/or perform and cause other parties who have any interest to take action as required by Party A and provide access to exercise the rights and authorization vested in Party A under this Agreement, and execute all the documents with respect to the Equity Interest and promptly provide all the notices, orders and decisions deemed necessary by Party A to Party A within a reasonable time.

6.5 Party B warrants to Party A that Party B will comply with and perform all the guarantees, covenants, agreements, representations and conditions herein for the benefit of Party A. Party B shall indemnify Party A for all the losses suffered by Party A in the event that Party B does not perform or fully perform such guarantees, covenants, agreements, representations or conditions.

Article 7 Events of Default

7.1 The occurrence of any of the events listed below shall be deemed an Event of Default:

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EQUITY INTEREST PLEDGE AGREEMENT

7.1.1 Party C fails to make full payment of the Consulting Fee as required under the Service Agreement.

7.1.2 Party B makes any misleading or fraudulent representations or warranties under Article 5 herein, and/or Party B violates any warranties under Article 5 herein.

7.1.3 Party B violates any of the covenants under Article 6 herein.

7.1.4 Party B violates any terms or conditions herein.

7.1.5 Party B waives, transfers or assigns the pledged Equity Interest without the prior written consent of Party A, except as provided by Article 6.1.1 herein.

7.1.6 Any external loan, security, compensation, covenant or other compensation liability of Party B (1) is required to be repaid or performed prior to its scheduled date; or (2) is due but is not repaid or performed as scheduled.

7.1.7 Party B is incapable of repaying its general debt or other debt.

7.1.8 Party A determines that the performance of this Agreement is illegal for any reason.

7.1.9 Any approval, permit or authorization needed to perform this Agreement or to validate this Agreement is withdrawn, suspended, invalidated or materially revised.

7.1.10 The property of Party B adversely changes and causes Party A to conclude that the capability of Party B to perform the obligations herein under this Agreement is impaired.

7.1.11 The successors or assigns of Party C are only entitled to perform a portion of or refuse to perform the payment obligations under the Service Agreement.

7.1.12 Other circumstances whereby Party A determines that its rights hereunder have been impaired.

7.2 Party B shall immediately notify Party A in writing if Party B becomes aware of or finds that any event under Article 7.1 herein or any event that may result in an Event of Default has occurred or is occurring.

7.3 Unless the Event of Default under Article 7.1 herein has been remedied to Party A’s sole and absolute satisfaction, Party A may, at any time during the Event of Default, immediately give a written Notice of Default to Party B requiring Party B to make immediate full payment of the then outstanding Consulting Fee under the Service Agreement and other payables or foreclose on the Pledge in accordance with Article 8 herein.

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EQUITY INTEREST PLEDGE AGREEMENT

Article 8 Exercise of the Right of Pledge

8.1 Prior to the full satisfaction by Party C of its obligations under the Service Agreement, including without limitations the full payment of the Consulting Fee, Party B shall not transfer or assign the Equity Interest without prior written approval from Party A.

8.2 Party A shall give Notice of Default to Party B when Party A exercises its right to foreclose on the Pledge.

8.3 Subject to Article 7.3, Party A may exercise the right to foreclose on the Pledge at any time provided Party A gives the Notice of Default pursuant to Article 7.3.

8.4 Party A is entitled to have priority in receiving payment or proceeds from the auction or sale of all or part of the Equity Interest pledged herein in accordance with applicable law until the Consulting Fee and all other payables under the Service Agreement are fully paid.

8.5 Party B shall not hinder Party A from foreclosing on the Pledge in accordance with this Agreement and shall give necessary assistance so that Party A may effectively realize the value of the Equity Interest.

Article 9 Transfer or Assignment

9.1 Party B shall not transfer or assign any rights or obligations herein without the prior written consent of Party A, which shall be in Party A’s sole and absolute discretion. Party B understands that any transferee or assignee shall be required to be bound hereby.

9.2 Party A may transfer or assign all or any rights and obligations under the Service Agreement to any person (natural person or legal entity) at any time without the consent of Party B. Any transferee or assignee shall enjoy and undertake the same rights and obligations herein of Party A as if the assignee were a party hereto. If Party A transfers or assigns the rights and obligations under the Service Agreement, the Service Agreement will continue in full force and effect without need for execution of further documents.

9.3 This Agreement shall be binding upon and inure to the benefit of Party A and its successors and assigns and shall be effective as to Party B and any of its permitted successors and assigns.

Article 10 Termination

10.1 This Agreement shall remain in full force and effect so long as the Service Agreement remains in effect.

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EQUITY INTEREST PLEDGE AGREEMENT

Article 11 Formalities Fees and Other Expenses

11.1 Party B shall be responsible for all the fees and actual expenditures in relation to this Agreement, including but not limited to, legal fees, stamp tax and any other taxes and charges. If Party A pays any such fees on behalf of Party B, Party B shall promptly reimburse Party A in full. Nothing in the foregoing sentence shall be construed to require Party A to pay any such fees.

11.2 Party B shall be responsible for all the fees, including but not limited to, any taxes, formalities fees, management fees, litigation fees, attorneys’ fees, and various insurance premiums in connection with disposition of the pledged Equity Interest incurred by Party B by virtue of Party B’s failure to pay any taxes, fees or charges in accordance with this Agreement.

Article 12 Force Majeure

12.1 If the fulfillment of this Agreement is delayed or blocked due to a Force Majeure Event, the Party affected by such a Force Majeure Event shall be free from any obligation to the extent of the delay or holdback. The Party claiming the occurrence of a Force Majeure Event shall provide the other party with the steps of fulfilling the obligations of this Agreement.

12.2 Performance under this Agreement shall be suspended during the existence of such Force Majeure Event, provided the Party claiming the existence of the Force Majeure Event has notified the other Party of the existence of such Force Majeure Event and has used reasonable best efforts to perform under the Agreement. Both Parties agree to use reasonable best efforts to resume performance of this Agreement if the reason for exemption has been corrected or remedied.

Article 13 Governing Law and Dispute Settlement

13.1 The execution, effectiveness, construction, performance, amendment and termination of this Agreement and the resolution of disputes hereunder shall be governed by the laws of China.

13.2 The Parties shall strive to settle any dispute arising from the interpretation or performance of this Agreement through mutual agreement and negotiation. In case no settlement can be reached through consultation, each Party can submit such matter to the China International Economic and Trade Arbitration Committee for arbitration according its then effective arbitration rules. The arbitration shall be held in Beijing. The arbitration proceedings shall be conducted in Chinese. The arbitration award shall be final and binding upon the Parties. The arbitration award may be submitted to the applicable PRC court for enforcement.

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EQUITY INTEREST PLEDGE AGREEMENT

Article 14 Notices

14.1 Any notice or other communication under this Agreement shall be in Chinese and be sent to the address first written above or other address as may be designated from time to time by hand delivery or mail or facsimile. Any notice required or given hereunder shall be deemed to have been served: (a) on the same date if sent by hand delivery; (b) on the tenth date after posting if sent by air-mail, (c) on the fourth date if sent by professional hand delivery which is acknowledged worldwide; and (d) the receipt date displayed on the transmission confirmation notice if sent by facsimile.

Article 15 Appendix

15.1 The Appendix of this Agreement as attached hereto is the part of this Agreement.

Article 16 Effectiveness

16.1 This Agreement is effective as of the date above first written. Any amendments, supplements and modifications shall be in writing and shall be effective upon execution by the Parties thereto.

[THIS SPACE IS INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the Parties have caused their authorized representatives to execute this Agreement as of the date first written above.

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EQUITY INTEREST PLEDGE AGREEMENT

Party A: Putian Asia Success Cereals & Oils Technical Service Co., Ltd [seal]

By:	/s/ Yao Jianshan
Name:	Yao Jianshan
Its:	Chief Executive Officer

Page 9 of 11

EQUITY INTEREST PLEDGE AGREEMENT

Party B: Yao Jianxin

/s/ Yao Jianxin

Yao Jianxin

Page 10 of 11

EQUITY INTEREST PLEDGE AGREEMENT

Party C: Fujian Grand Farm Foods Development Co., Ltd. [seal]

By:	/s/ Yao Jianshan
Name:	Yao Jianshan
Its:	Chief Executive Officer

Page 11 of 11

EX-10.7

Power of Attorney

Power of Attorney

I, Yao Jianshan, am a citizen of the People’s Republic of China (the “PRC”), have an ID number of 350303690720035, and hold a 99.75% equity interest (the “Equity Interest”) inFujianGrand Farm Foods Development Co., Ltd. (the “Company”). As a shareholder of the Company, I hereby irrevocably entrustPutian Asia Success Cereals & Oils Technical Service Co., Ltd (“Putian Asia”) to exercise the following rights under the terms of this Power of Attorney:

I exclusively authorize Putian Asia to be my sole representative with full authority to perform and exercise any and all shareholder’s rights associated with the Equity Interest, including but not limited to, the right to attend shareholders’ meetings, the right to execute shareholders’ resolutions, the right to sell, assign, transfer or pledge any or all of the Equity Interest and the right to vote the Equity Interest for all matters, including but not limited to, the appointment of legal representatives, board members, executive directors, inspectors, chief managers and other senior management officers.

I exclusively entrust Putian Asia as my sole representative with full power to execute any agreement for the transfer of the Equity Interest pursuant to that certain Exclusive Equity Interest Purchase Agreement of even date herewith and to which I am a party, to perform the obligations thereunder on my behalf and to complete all actions I am required to perform under the Exclusive Equity Interest Purchase Agreement and the Equity Interest Pledge Agreement, both of which I am a party to and which are entered into as of the execution date of this Power of Attorney. The performance of the above mentioned rights shall not constitute a limitation on this Power of Attorney.

Except as otherwise provided hereunder, Putian Asia shall be entitled to transfer, allocate or in any other way utilize the cash dividends and other non-cash income arising out of the Equity Interest in accordance with my oral or written instructions.

Except as otherwise provided hereunder, Putian Asia shall be entitled to exercise all the necessary rights associated with the Equity Interest at its sole discretion and without any further oral or written instructions.

Putian Asia is entitled to assign the authorization granted under this Power of Attorney to any other individual(s) or legal person(s) without issuing any advance notice or obtaining my consent. Should any such assignment occur, Putian Asia shall promptly notify me and indemnify me from any and all losses incurred as a result of the assignment.

Page 1 of 2

Power of Attorney

This Power of Attorney shall be executed and come into effect as of the date set forth below. This Power of Attorney is coupled with an interest and is irrevocable and validly existing for as long as I am a shareholder of the Company.

Should I desire to exercise the rights entrusted to Putian Asia hereunder, I shall provide Putian Asia with advance notice of my intentions to do so and agree that I shall have no authority to exercise such rights unless either (i) the rights are specifically reserved to me hereunder or (ii) Putian Asia, in its sole and absolute discretion, consents to such exercise.

Signature

/s/ Yao Jianshan

Yao Jianshan

Effective as of September 25, 2010

Page 2 of 2

EX-10.8

Power of Attorney

Power of Attorney

I, Yao Jianxin, am a citizen of the People’s Republic of China (the “PRC”), have an ID number of 350303197201280334, and hold a 0.25% equity interest (the “Equity Interest”) inFujianGrand Farm Foods Development Co., Ltd. (the “Company”). As a shareholder of the Company, I hereby irrevocably entrustPutian Asia Success Cereals & Oils Technical Service Co., Ltd (“Putian Asia”) to exercise the following rights under the terms of this Power of Attorney:

I exclusively authorize Putian Asia to be my sole representative with full authority to perform and exercise any and all shareholder’s rights associated with the Equity Interest, including but not limited to, the right to attend shareholders’ meetings, the right to execute shareholders’ resolutions, the right to sell, assign, transfer or pledge any or all of the Equity Interest and the right to vote the Equity Interest for all matters, including but not limited to, the appointment of legal representatives, board members, executive directors, inspectors, chief managers and other senior management officers.

I exclusively entrust Putian Asia as my sole representative with full power to execute any agreement for the transfer of the Equity Interest pursuant to that certain Exclusive Equity Interest Purchase Agreement of even date herewith and to which I am a party, to perform the obligations thereunder on my behalf and to complete all actions I am required to perform under the Exclusive Equity Interest Purchase Agreement and the Equity Interest Pledge Agreement, both of which I am a party to and which are entered into as of the execution date of this Power of Attorney. The performance of the above mentioned rights shall not constitute a limitation on this Power of Attorney.

Except as otherwise provided hereunder, Putian Asia shall be entitled to transfer, allocate or in any other way utilize the cash dividends and other non-cash income arising out of the Equity Interest in accordance with my oral or written instructions.

Except as otherwise provided hereunder, Putian Asia shall be entitled to exercise all the necessary rights associated with the Equity Interest at its sole discretion and without any further oral or written instructions.

Putian Asia is entitled to assign the authorization granted under this Power of Attorney to any other individual(s) or legal person(s) without issuing any advance notice or obtaining my consent. Should any such assignment occur, Putian Asia shall promptly notify me and indemnify me from any and all losses incurred as a result of the assignment.

Page 1 of 2

Power of Attorney

This Power of Attorney shall be executed and come into effect as of the date set forth below. This Power of Attorney is coupled with an interest and is irrevocable and validly existing for as long as I am a shareholder of the Company.

Should I desire to exercise the rights entrusted to Putian Asia hereunder, I shall provide Putian Asia with advance notice of my intentions to do so and agree that I shall have no authority to exercise such rights unless either (i) the rights are specifically reserved to me hereunder or (ii) Putian Asia, in its sole and absolute discretion, consents to such exercise.

Signature

/s/ Yao Jianxin

Yao Jianxin

Effective as of September 25, 2010

Page 2 of 2

EX-10.9

Exhibit 10.9

Employment Agreement

of Fujian Grand Farm Foods Development Co., Ltd.

Party A: Fujian Grand Farm Foods Development Co., Ltd. (hereafter referred to as “Party A”)

Address: No. 2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, China

Legal Representative or authorized signer: Jianbing Yao

Party B: Kaigang Cheng (hereafter referred to as “Party B”)

ID: xxxxxxxx

Address: Hanjiang District, Putian, Fujian Province

Phone: xxxxxxxx

This Employment Agreement (the “Agreement”) is entered into by and between Party A and Party B pursuant to the Contract Law of the People’s Republic of China and other relevant laws and regulations.

Section 1. Type and Term of Agreement

Article 1. The parties agree that this Agreement is an employment agreement. The term of the Agreement is 24 months, starting from July 1, 2010 to June 30, 2012. Upon the expiration of the Agreement, the parties may extend the term of the Agreement for an additional 1 year(s) based on mutual agreement. If the parties agree to enter into a new employment agreement for the extension, the new agreement shall be entered into within 30 days before the expiration date of this Agreement.

Section 2. Probation Period

Article 2. The probation period will be N/A months starting from N/A to N/A.

Section 3. Position of Employee and Place of Work

Article 3. Party A hereby agrees to hire Party B as the Chief Executive Officer of Party A.

Article 4. Party B shall be responsible for:

(1) Decision making for all material matters in connection with the operation of Party A;

(2) Management of daily operation activities of Party A; and

(3) Hiring members of senior management of Party A.

Article 5. Party B shall work at Party A’s office in Putian, Fujian Province.

Article 6. Party B shall perform with due diligence the duties as a Chief Executive Officer and complete works assigned by Party A in a timely manner.

Section 4. Work Hours and Vacation

Article 7. Party B is not subject to any fixed work hours. However, Party B shall perform his/her work duties set forth in Article 4 with good faith and due diligence.

Article 8. Party B is entitled to statutory holidays and employee vacation times, including but not limited to, New Year’s Day, Chinese New Year, Labor Day, National Day and other statutory holidays, maternity leave, bereavement leave, honeymoon, etc.

Article 9. Party B shall work overtime as requested by Party A.

Section 5. Company Rules and Policies

Article 10. Party B shall comply with applicable laws and regulation and act in accordance with social and professional ethics. Party B shall not act against the reputation and benefit of Party A.

Article 11. Party B shall comply with internal rules and policies of Party A. Party A shall timely notify its employees of any change of internal rules and policies.

Article 12. Party B shall not engage in any outside work or activity that may have conflict of interest against Party A and shall protect Party A’s intellectual properties and trade secrets to which Party B has access.

Article 13. Until this Agreement is terminated, Party A shall have the right to impose administrative or monetary penalties on Party B pursuant to laws and company rules if Party B’s act violates company rules.

Section 6. Compensation

Article 14. Party B shall be entitled to compensation as follows:

(1) Party B is entitled to a monthly salary of RMB N/A during the probation period.

(2) After the probation period, Party B is entitled to a monthly salary of 10,000 RMB and a bonus based on the performance of the company.

(3) Party B’s monthly salary shall be payable on the 25th day of each month.

(4) Party B’s compensation for overtimes shall be determined by both parties through further consultation.

(5) Party B is entitled to a raise of salary based on the local economy in accordance with employee compensation guidance issued by local government.

(6) Party B’s salary is deductable for leaves.

Article 15. The parties shall pay the employee’s social insurance as follows:

(1) The parties shall pay their respective share of the employee’s social insurance. Party B’s payment of social insurance may be firstly paid by Party A and then deducted from Party B’s salary.

(2) Party A is responsible for the first-time aid for any incident or injury that Party B suffers during work hours and for which a request for work-related injury assessment is submitted to the labor and social insurance department within the stipulated time period. Party B is entitled to all statutory compensation and treatment for work-related injuries.

(3) Party B is entitled to all statutory employee benefits.

Section 7. Reimbursement

Article 16. Party A shall reimburse Party B for work-related traveling expenses.

Section 8. Amendment, Termination and Expiration of the Agreement

Article 17. The terms and conditions of this Agreement may be amended if any relevant laws and regulations are amended.

Article 18. In case that the performance of this Agreement is rendered impossible by any material change of circumstances, the parties may amend or terminate this Agreement upon mutual agreement.

Article 19. If Party A determines during Party B’s probation period that Party B is incompetent for the designated position, Party A shall give Party B notification of termination of the Agreement three days before the end of the probation period.

Article 20. Party A may terminate the Agreement and the employment of Party B immediately if:

A. Party B gives false or fake personal information, including but not limited to: termination of employment with former employer, identity, residence registration, educational background, medical check, history of mental or infectious disease, history of dismissal by former employer, drug abuse, imprisonment or history of criminal liability, etc.;

B. Party B violates company rules in a serious circumstance;

C. Party B engages in serious negligence or favoritism, which causes a damage of RMB 5,000 or more to Party A;

D. Party B establishes employment relationship with another employer, disregards Party A’s warning and fails to perform his/her duties as assigned by Party A, which causes a damage of RMB 5,000 or more to Party A;

E. Party B is charged with a criminal offense;

F. Either party terminates the Agreement with the other party’s consent;

G. This Agreement is entered into or amended by Party B through fraud or coercion; or

H. This Agreement is deemed void under any applicable laws and regulations.

Article 21. Party A may terminate the Agreement by giving Party B a 30-day written notice if:

A. Party B is unable to perform the work assigned by Party A due to sickness or injury;

B. Party B is incompetent to perform the work assigned by Party A after training or change of position and refuses to accept Party A’s arrangement for change of position;

C. Party B’s designated position is no longer in existence due to merger, division, joint venture, change of ownership, change of operation or location of Party A;

D. Party A has difficulties continuing its business; or

E. The parties cannot reach an agreement on the amendment of the Agreement pursuant to Article 18.

Article 22. Party B may terminate the Agreement by giving Party A a 30-day written notice (or by a 3-day written notice if during the probation period). Party B may also terminate the Agreement at any time if:

A. Party A fails to provide labor security or conditions as agreed in this Agreement;

B. Party A fails to pay Party B’s salary on time or in the agreed amount;

C. Party A fails to pay the required amount of social insurance for Party B;

D. Party A’s internal rules or policies contradict with laws and regulations and harm the benefit of employee;

E. This Agreement is rendered unenforceable according to section 1 of Article 26; or

F. Any situation, under which the employee has the right to terminate the Agreement pursuant to applicable laws and regulations, occurs.

Party B may terminate this Agreement immediately without notice if Party A forces Party B to work by threat, violence, or detention, or Party A forces Party B to work in danger.

Article 23. The Agreement shall be terminated if:

A. The parties cannot reach an agreement on renewal of the Agreement upon the expiration of the Agreement;

B. As agreed by the parties, an event that triggers the termination of the Agreement happens;

C. Party B is temporarily unable to perform his/her duties under the Agreement for 15 consecutive days due to, including but not limited to, detention by police, off-duty training program, engagement in public service activities, etc.;

D. Party B joins the military or is committed to other statutory duties; or

E. The Agreement must be terminated under any applicable laws and regulations.

Sectin 9. Parties’ Duties Upon Termination of the Agreement

Article 24. Upon termination of the Agreement, Party B is obligated to:

A. Complete transition work with the successor designated by Party A;

B. Return office supplies, documents and equipment to Party A;

C. Return all material information of Party A;

D. Coordinate with Party A to clear all debts between the parties;

E. Complete all paperwork in connection with resignation required by Party A; and

F. Complete or handover all unfinished matters.

Article 25. Upon termination of the Agreement, Party A is obligated to:

A. Prepare all paperwork and procedure for the termination of employment of Party B; and

B. Issue work evaluation for Party B upon Party B’s request.

Section 10. Economic Compensation and Damages

Article 26. If Party B fails to give Party A the 30-day notice for his/her resignation, Party A shall pay Party B’s earned salary after the transition of work is complete.

Article 27. If Party B causes economic damage to Party A by failing to repay his/her debt to Party A or by terminating the Agreement in breach of any term of the Agreement, Party B shall be subject to compensating Party A for such damages, and Party A has the right to deduct such amount from Party B’s salary or bonus. If Party B’s salary or bonus is not sufficient for the compensation, Party A is entitled to make claim against Party B for the deficient amount.

Section 11. Confidentiality

Article 28. Party B shall keep confidential any of Party A’s trade secrets. Trade secret means any information that is not generally known, by which Party A can obtain an economic interest, and is protected by Party A from disclosure, including but not limited to:

A. Technology information, including technology and project design, formula, technique flowchart, statistic, computer software, database, experiment report, drawing, sample, module, operation manual, documents and business communications;

B. Operation information, including customer list, marketing plan, purchasing materials, pricing policies, undisclosed financial information, compensation, supplier information, sales policies, bidding materials, etc.; and

C. Any other information that Party A is obligated to keep confidential pursuant to laws and agreements.

Section 12. Dispute Resolution

Article 29. Any dispute arising from performance of this Agreement may be resolved through consultation or submitted to a labor arbitration committee at Party A’s location or submitted to a court of law at Party A’s location.

Chapter 13. Miscellaneous

Article 30. The internal rules and policies of the company (including but not limited to employee’s manual, description of duty, training agreement, confidential agreement and security code) are integral part of this Agreement and shall have the same effect of this Agreement.

Article 31. If any terms or conditions of this Agreement contradict with any laws or regulations, such laws and regulations shall prevail.

Article 32. The parties may enter into other agreements for any unsettled matters under this Agreement. If there is no agreement addressing an unsettled matter under the Agreement, the matter shall be handled according to applicable laws, regulations or Party A’s internal rules.

Article 33. Supplemental Articles

N/A

Article 34. This Agreement shall be executed in three duplicate originals. Party A shall hold two duplicate originals and Party B shall hold one duplicate original. This Agreement shall become effective upon execution by both parties.

Party A: Fujian Grand Farm Foods Development Co., Ltd. [seal]

/s/ Jianshan Yao

Party B: Kaigang Cheng

/s/ Kaigang Cheng

Signing Date: July 1, 2010

Signing Place:

EX-10.10

Exhibit 10.10

Confidentiality and Non-compete Agreement

This Confidentiality and Non-compete Agreement (the “Agreement”) is entered into by and between the parties listed below on April 1, 2010 in Putian, Fujian Province, People’s Republic of China (“China”).

Party A: Fujian Grand Farm Foods Development Co., Ltd.

Address: No. 2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, China

Legal Representative or authorized signer: Jianbing Yao

Party B: Kaigang Cheng

ID: xxxxxxxxx

Address: Hongchu Town, Ziyang County, Shaanxi Province

Whereas Party B is an employee of Party A and receives compensation for services it provides to Party A, the parties hereby agree to enter into this Agreement. In this Agreement, the term “Group” includes Party A and any entities that Party A has established or will establish, including any shareholding company, parent company, subsidiary and affiliate of Party A, or any subsidiary or branch of Party A’s shareholding company.

1. Employment. The parties have entered into another agreement to memorize the employment relationship between the parties. This Agreement shall not be interpreted as an acknowledgement or proof of such employment relationship.

2. Business:

3. Confidential Information: The term “confidential information” in this Agreement shall include:

3.1 Information of Party A, including any information relating to technology, special techniques, operation, or other classified information, especially:

3.1.1 Technique information, which includes all information on production and sales of products, such as technique improvement plan, project design, circuit design, manufacturing process, formula, flowchart, data, computer software, database, lab report, drawing, sample, module, instrument, handbook, confidential business correspondence or other information that may be deemed as trade secret;

3.1.2 Operation information, which includes all information relating to operating activities of Party A, such as marketing strategies, supply channels, purchasing plans, pricing policies, confidential financial information, contracts, information of purchasers, suppliers and customers;

3.1.3 Information on public listing that is only known by insiders, such as unfinished or undisclosed registration statement, due diligence memo, financial data, description of business, business plan, strategic plan, presentation, training materials, press release, speech script, video, correspondence with investment banker, legal counsel, auditor, SEC staff or other parties;

3.1.4 Any information that Party A is obligated to keep confidential pursuant to a contract;

3.1.5 Any oral communication between the parties regarding confidential information (Party B shall deliver such information in a written form to Party A within 15 days after the communication); and

3.1.6 Any other information that is protected from access of a third party through reasonable means.

3.2 Third party information, including any information obtained or will be obtained by Party B from subsidiary or affiliate of Party A and/or the Group. Party A and/or other member of the Group shall have the obligation to keep such information confidential and use the information for the designated purposes. Party B shall not disclose such information to any individual, partnership or company unless such disclosure is necessary to conduct his/her work assigned by Party A or such disclosure is required pursuant to a contract entered into between Party A and a third party.

4. Forms of Trade Secret

4.1 Any confidential information, in the form of paper or electronic file, material, photo, chart, note, report, letter, fax, cassette, CD, device or any other carrier, held or used by Party B in connection with Party B’s work duties is a property of Party A, no matter whether or not such information has commercial value to Party A.

4.2 Upon the termination of his/her employment, Part B shall return all above said information to Party A and shall not duplicate or keep such information or give the information to a third party.

4.3 If the above said confidential information is carried by Party B’s device, Party B shall give such device to Party A upon termination of his/her employment and Party A shall pay Party B for such device.

5. Confidentiality

5.1 During his/her employment, Party B shall take reasonable measures to protect the confidential information of Party A by following required operating process and taking sufficient precautions.

5.2 During his/her employment and upon termination of the employment, Party B shall not disclose the confidential information of Party A, unless such disclosure is for the benefit of Party A or the Group. Party B shall not use the confidential information or disclose, distribute, publish, transfer such confidential information to any individual, partnership or company (including other employees of Party A who have no access to such confidential information according to Party A’s internal rules) unless is otherwise authorized by Party A in writing. Party B agrees to protect the confidential information of Party A to the same extent as protecting his/her personal private information and shall not use, disclose, publish or transfer such information without Party A’s prior consent.

5.3 Party B shall not take the confidential information outside Party A’s office without Party A’s prior written consent unless it is for the benefit of Party A and the Group.

5.4 Party B shall not disclose the confidential information to a third party unless such disclosure is necessary for the business between the third party and Party A. The third party shall firstly execute a confidential agreement before receiving such information.

5.5 Any third party, including the management, employee and counsel of the third party, may be given access to the confidential information of Party A under the condition that all people who are given access to the confidential information must keep the information confidential.

5.6 Unless for the benefit of Party A or the Group, Party B shall not disclose or discuss his or her salary, bonus, benefit, option or other compensation with a third party other than Party B’s family members.

6. Intellectual Property

6.1 Ownership and use. Any invention, authorship, creation, innovation and trade secret created by Party B prior to his/her employment with Party A as listed in Exhibit A (“Pre-employment Work”) is a property of Party B and has not been licensed or transferred to Party A. If Party B combines any of his/her Pre-employment Work with Party A’s product, program or device owned during employment, Party A shall have nonexclusive and irrevocable right to use the Pre-employment Work permanently and universally as part of the said product, program or device, and shall also have the right to improve, use or sell the Pre-employment Work as part of the said product, program or device.

6.2 Disclosure. Party B agrees that during his/her employment, any invention, authorship, creation, innovation, design, discovery, idea, trademark, trade secret, program, know-how or other work created by Party B alone or with others (“In-Employment Work”), registrable or unregistrable as intellectual property, shall be disclosed to Party A or designee of Party A.

6.3 Intellectual Property. The parties agree that Party A shall have title to any In-Employment Work created by Party B using materials and information provided by Party A. Any work relating to Party B’s duties created within one year after the termination of Party B’s employment shall also be deemed as In-Employment Work. Party B understands and agrees that Party A has the right to commercialize and sell any In-employment Work for the sole benefit of Party A or other member of the Group. Party B may claim the title to any In-employment Work created by Party B by submitting a request in writing and will have the title to the In-employment Work upon Party A’s consent. If a work created by Party B is not an In-employment Work but is relating to the business of Party A, Party A or other member of the Group shall have the priority to purchase all or part of the work within three months after Party B disclosing the work to Party A.

6.4 Maintenance of Files. Party B agrees to maintain the files prepared by Party B alone or with others during his/her employment. Such files may be records, briefs, drawings or in any other format. Party A shall have the right to obtain such files and shall have the sole ownership of such files.

6.5 Registration of Patent and Copyright. Party B agrees to assist Party A or the designee of Party A with registration of patent, copyright or other intellectual property in one or all countries at Party A’s costs. Party B’s duties include preparing and submitting all paperwork for registration and providing necessary proof upon transfer or license of such intellectual properties by Party A, or the successor, transferee or nominee of Party A. Party B further agrees that Party B will continue to perform the above said duties, if necessary, with due diligence after termination of his/her employment.

7. Conflict of Interest. During his/her employment, Party B shall provide his/her services on a full time basis and shall not directly or indirectly provide services to or engage with other entities that conduct or will conduct similar business with Party A/Group and shall not participate in any activities that may have conflict to Party B’s employment. Without the unanimous written consent of the board of directors of Party A, Party B shall not own or hold any equity or interest of any other companies that conduct or will conduct similar business with Party A/Group during Party B’s employment, unless Party B has disclosed his/her ownership of such equity or interest to Party A before executing this Agreement.

8. Non-compete Clause

8.1 Party B agrees that, upon voluntary or involuntary termination of his/her employment for any cause, Party B shall turn in all information held by Party B relating to Party B’s duty, including files, records, information, materials, instruments, data, notes, reports, plans, index, letters and correspondences, statements, drawings, blueprints and memos (include but not limited to the duplicate of the above listed items), and complete all necessary procedures and paperwork required by Party A to terminate the employment. Party B shall guarantee not to disclose, maintain, recreate, duplicate or circulate the confidential information of Party A upon termination of his/her employment.

8.2 Party B agrees that, during his/her employment or within three months (unless Party A agrees to a shorter term) upon voluntary or involuntary termination of his/her employment for any cause (“Non-compete Period”), unless waived or consented otherwise by the board of directors of Party A by unanimous written consent, Party B shall not: (i) act as a shareholder, partner, employee, counsel, administrator, director, manager, agent, cooperator, or investor of an entity that has conflict of interest with or conduct similar business as Party A or the Group; (ii) directly or indirectly own, purchase, set up or solicit a business that is similar to or competes with the business of Party A or the Group; or (iii) participate in establishing, designing, financing, acquiring, leasing, operating, managing, investing, counseling, or engaging in insider activity for a business that is similar to or competes with the business of Party A or the Group. The above listed restrictions shall apply to any activities conducted by Party B in (a) mainland of China; (b) Taiwan; (c) Hong Kong; and (d) Macau (collectively “Jurisdictions”).

8.3 Article 8.1 is applicable in any cities, counties, towns and countries in the Jurisdictions. If an arbitration court in any of the Jurisdictions holds a part of the Agreement unenforceable, such part shall be excluded from this Agreement and the remainder of the Agreement shall still apply. If the Non-compete Period is longer than the maximum statutory time applicable in a certain Jurisdiction, the Non-compete Period shall be adjusted to the maximum time as allowed by the law of the Jurisdiction.

8.4 Party B shall be entitled to compensation for complying Article 8 upon termination of his/her employment (“Compensation”). The Compensation shall be payable each month during the Non-compete Period in an amount equivalent to Party B’s monthly salary in the last month of Party B’s employment. The amount of Compensation shall be adjusted according to applicable laws and regulations. If Party A waives its right under the non-compete clause or agrees to a shorter Non-compete Period, the amount of Compensation shall be decreased on a pro rata basis.

8.5 During the Non-compete Period, Party A may choose to exempt Party B from the non-compete clause under Article 8.1 through a written consent or by not paying the Compensation. Once Party A fails to pay the Compensation under Article 8.4, Party B shall be exempted from the non-compete clause. Under such circumstance, Party A is not obligated to give any notice to Party B for the exemption and Party B shall not claim for the Compensation in any means (including but not limited to through arbitration or litigation).

9. Return of Files. Party B agrees that all materials and documents, such as designs, files, data, records, reports, written plans, lists, letters, statements, drawings, brief, instruments and other documents or copies of the said documents that belong to Party A or the Group, or successor or transferee of Party A or the Group used by Party B during his/her employment shall be returned to Party A. Party B shall not keep, duplicate or transfer such documents.

10. Breach of Agreement. Party B shall compensate for any loss caused to Party A by Party B’s breach of this Agreement. Party A may deduct such compensation from Party B’s paycheck upon Party B’s consent.

11. Disclose to New Employer. Party B agrees that upon termination of his/her employment, Party A may disclose the terms and conditions under this Agreement to Party B’s new employer.

12. Non-solicitation of Employee. Party B agrees that he/she will not, for a period of 24 months after the termination of his/her employment, directly or indirectly, approach, solicit, entice or attempt to approach, solicit or entice any of the other employees of Party A or the Group to leave the employment of Party A.

13. Representation. Party B represents that his/her performance of this Agreement will not conflict with his/her obligation of confidentiality for information obtained prior to his/her employment with Party A and Party B has never entered into and will not enter into any other oral or written agreement that may contradict his/her obligation under this Agreement.

14. General Terms and Conditions

14.1 Applicable Laws. The execution, effect, interpretation and performance of this Agreement and any conflict arising from the performance of this Agreement shall be governed by laws and regulations of China and shall not be affected by the principles of selection of laws and conflict of laws.

14.2 Notice. The parties’ addresses indicated on the first page of this Agreement shall be used as mailing address required for giving notices according to this Agreement. If the notice is delivered in person, or by express or prepaid mail, the date that the notice arrives at the receiver’s address shall be deemed as the date of notice. If the notice is sent by fax, the date of sending the fax shall be deemed as the date of notice.

14.3 Complete Agreement. This Agreement sets forth all agreements between the parties on matters in connection with confidentiality and non-compete and shall supersede and cover all prior agreements between the parties in this respect. Any amendment or revision to this Agreement shall be deemed unenforceable unless otherwise agreed by the parties in wring. Any change of Party B’s work duties, salary or compensation shall not affect the effect and scope of this Agreement.

14.4 Collateral Agreement. This Agreement shall be deemed and interpreted as a collateral agreement of the Employment Agreement entered into by and between the parties. Any unsettled matter under this Agreement shall be resolved based on law or, if not provided by law, on the Employment Agreement. The effect of this Agreement shall survive the termination of the Employment Agreement.

14.5 Severability. If any provision under this Agreement is rendered or deemed unenforceable, the remainder of this Agreement shall still apply.

14.6 Successor and Assignee. This Agreement shall be enforceable to successor, heir, manager or other legal representative of Party B and shall protect the interest of Party A and the successors and assignees of Party A.

14.7 Duplicate Originals. This Agreement shall be executed into more than one duplicate originals. All duplicate originals shall have the equivalent effect.

Party A: Fujian Grand Farm Foods Development Co., Ltd. [seal]

/s/ Jianshan Yao

Party B: Kaigang Cheng

/s/ Kaigang Cheng

Exhibit A

Pre-employment Work

None.

EX-10.11

Exhibit 10.11

Employment Agreement

of Putian Jiateng Food Industry Co., Ltd.

(now known as “Fujian Grand Farm Foods Development Co., Ltd.”)

Party A: Putian Jiateng Food Industry Co., Ltd. (hereafter referred to as “Party A”)

Address: No. 2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, China

Legal Representative or authorized signer: Jianbing Yao

Party B: Chaotang Li (hereafter referred to as “Party B”)

ID: xxxxxxxx

Address: 199 Huang Dun Ling Building 36, Unit 2, Room 5, Yanping District, Nanping, Fujian Province

Phone: xxxxxxxx

This Employment Agreement (the “Agreement”) is entered into by and between Party A and Party B pursuant to the Contract Law of the People’s Republic of China and other relevant laws and regulations.

Section 1. Type and Term of Agreement

Article 1. The parties agree that this Agreement is an employment agreement. The term of the Agreement is 60 months, starting from January 1, 2008 to December 31, 2012. Upon the expiration of the Agreement, the parties may extend the term of the Agreement for an additional 1 year(s) based on mutual agreement. If the parties agree to enter into a new employment agreement for the extension, the new agreement shall be entered into within 30 days before the expiration date of this Agreement.

Section 2. Probation Period

Article 2. The probation period will be N/A months starting from N/A to N/A.

Section 3. Position of Employee and Place of Work

Article 3. Party A hereby agrees to hire Party B as the Strategic Development Director of Party A.

Article 4. Party B shall be responsible for:

(1) Setting up the business direction and development model;

(2) Making business plans and operation mechanism; and

(3) Collecting and analyzing industry information.

Article 5. Party B shall work at ________________________.

Article 6. Party B shall perform with due diligence the duties as a Strategic Development Director and complete works assigned by Party A in a timely manner.

Section 4. Work Hours and Vacation

Article 7. Party B is not subject to any fixed work hours. However, Party B shall perform his/her work duties set forth in Article 4 with good faith and due diligence.

Article 8. Party B is entitled to statutory holidays and employee vacation times, including but not limited to, New Year’s Day, Chinese New Year, Labor Day, National Day and other statutory holidays, maternity leave, bereavement leave, honeymoon, etc.

Article 9. Party B shall work overtime as requested by Party A.

Section 5. Company Rules and Policies

Article 10. Party B shall comply with applicable laws and regulation and act in accordance with social and professional ethics. Party B shall not act against the reputation and benefit of Party A.

Article 11. Party B shall comply with internal rules and policies of Party A. Party A shall timely notify its employees of any change of internal rules and policies.

Article 12. Party B shall not engage in any outside work or activity that may have conflict of interest against Party A and shall protect Party A’s intellectual properties and trade secrets to which Party B has access.

Article 13. Until this Agreement is terminated, Party A shall have the right to impose administrative or monetary penalties on Party B pursuant to laws and company rules if Party B’s act violates company rules.

Section 6. Compensation

Article 14. Party B shall be entitled to compensation as follows:

(1) Party B is entitled to a monthly salary of RMB N/A during the probation period.

(2) After the probation period, Party B is entitled to a monthly salary of RMB 5,500 and a bonus based on the performance of the company.

(3) Party B’s monthly salary shall be payable on the 25th day of each month.

(4) Party B’s compensation for overtime shall be determined by both parties through further consultation.

(5) Party B is entitled to a raise of salary based on the local economy in accordance with employee compensation guidance issued by the local government.

(6) Party B’s salary is deductible for leaves.

Article 15. The parties shall pay the employee’s social insurance as follows:

(1) The parties shall pay their respective share of the employee’s social insurance. Party B’s payment of social insurance may be firstly paid by Party A and then deducted from Party B’s salary.

(2) Party A is responsible for the first-time aid for any incident or injury that Party B suffers during work hours and for which a request for work-related injury assessment is submitted to the labor and social insurance department within the stipulated time period. Party B is entitled to all statutory compensation and treatment for work-related injuries.

(3) Party B is entitled to all statutory employee benefits.

Section 7. Reimbursement

Article 16. Party A shall reimburse Party B for work-related traveling expenses.

Section 8. Amendment, Termination and Expiration of the Agreement

Article 17. The terms and conditions of this Agreement may be amended if any relevant laws and regulations are amended.

Article 18. In case that the performance of this Agreement is rendered impossible by any material change of circumstances, the parties may amend or terminate this Agreement upon mutual agreement.

Article 19. If Party A determines during Party B’s probation period that Party B is incompetent for the designated position, Party A shall give Party B notification of termination of the Agreement three days before the end of the probation period.

Article 20. Party A may terminate the Agreement and the employment of Party B immediately if:

A. Party B gives false or fake personal information, including but not limited to: termination of employment with former employer, identity, residence registration, educational background, medical check, history of mental or infectious disease, history of dismissal by former employer, drug abuse, imprisonment or history of criminal liability, etc.;

B. Party B violates company rules in a serious circumstance;

C. Party B engages in serious negligence or favoritism, which causes a damage of RMB 5,000 or more to Party A;

D. Party B establishes employment relationship with another employer, disregards Party A’s warning and fails to perform his/her duties as assigned by Party A, which causes a damage of RMB 5,000 or more to Party A;

E. Party B is charged with a criminal offense;

F. Either party terminates the Agreement with the other party’s consent;

G. This Agreement is entered into or amended by Party B through fraud or coercion; or

H. This Agreement is deemed void under any applicable laws and regulations.

Article 21. Party A may terminate the Agreement by giving Party B a 30-day written notice if:

A. Party B is unable to perform the work assigned by Party A due to sickness or injury;

B. Party B is incompetent to perform the work assigned by Party A after training or change of position and refuses to accept Party A’s arrangement for change of position;

C. Party B’s designated position is no longer in existence due to merger, division, joint venture, change of ownership, change of operation or location of Party A;

D. Party A has difficulties continuing its business; or

E. The parties cannot reach an agreement on the amendment of the Agreement pursuant to Article 18.

Article 22. Party B may terminate the Agreement by giving Party A a 30-day written notice (or by a 3-day written notice if during the probation period). Party B may also terminate the Agreement at any time if:

A. Party A fails to provide labor security or conditions as agreed in this Agreement;

B. Party A fails to pay Party B’s salary on time or in the agreed amount;

C. Party A fails to pay the required amount of social insurance for Party B;

D. Party A’s internal rules or policies contradict with laws and regulations and harm the benefit of employee;

E. This Agreement is rendered unenforceable according to section 1 of Article 26; or

F. Any situation, under which the employee has the right to terminate the Agreement pursuant to applicable laws and regulations, occurs.

Party B may terminate this Agreement immediately without notice if Party A forces Party B to work by threat, violence, or detention, or Party A forces Party B to work in danger.

Article 23. The Agreement shall be terminated if:

A. The parties cannot reach an agreement on renewal of the Agreement upon the expiration of the Agreement;

B. As agreed by the parties, an event that triggers the termination of the Agreement happens;

C. Party B is temporarily unable to perform his/her duties under the Agreement for 15 consecutive days due to, including but not limited to, detention by police, off-duty training program, engagement in public service activities, etc.;

D. Party B joins the military or is committed to other statutory duties; or

E. The Agreement must be terminated under any applicable laws and regulations.

Sectin 9. Parties’ Duties Upon Termination of the Agreement

Article 24. Upon termination of the Agreement, Party B is obligated to:

A. Complete transition work with the successor designated by Party A;

B. Return office supplies, documents and equipment to Party A;

C. Return all material information of Party A;

D. Coordinate with Party A to clear all debts between the parties;

E. Complete all paperwork in connection with resignation required by Party A; and

F. Complete or handover all unfinished matters.

Article 25. Upon termination of the Agreement, Party A is obligated to:

A. Prepare all paperwork and procedure for the termination of employment of Party B; and

B. Issue work evaluation for Party B upon Party B’s request.

Section 10. Economic Compensation and Damages

Article 26. If Party B fails to give Party A the 30-day notice for his/her resignation, Party A shall pay Party B’s earned salary after the transition of work is complete.

Article 27. If Party B causes economic damage to Party A by failing to repay his/her debt to Party A or by terminating the Agreement in breach of any term of the Agreement, Party B shall be subject to compensating Party A for such damages, and Party A has the right to deduct such amount from Party B’s salary or bonus. If Party B’s salary or bonus is not sufficient for the compensation, Party A is entitled to make claim against Party B for the deficient amount.

Section 11. Confidentiality

Article 28. Party B shall keep confidential any of Party A’s trade secrets. Trade secret means any information that is not generally known, by which Party A can obtain an economic interest, and is protected by Party A from disclosure, including but not limited to:

A. Technology information, including technology and project design, formula, technique flowchart, statistic, computer software, database, experiment report, drawing, sample, module, operation manual, documents and business communications;

B. Operation information, including customer list, marketing plan, purchasing materials, pricing policies, undisclosed financial information, compensation, supplier information, sales policies, bidding materials, etc.; and

C. Any other information that Party A is obligated to keep confidential pursuant to laws and agreements.

Section 12. Dispute Resolution

Article 29. Any dispute arising from performance of this Agreement may be resolved through consultation or submitted to a labor arbitration committee at Party A’s location or submitted to a court of law at Party A’s location.

Chapter 13. Miscellaneous

Article 30. The internal rules and policies of the company (including but not limited to employee’s manual, description of duty, training agreement, confidential agreement and security code) are integral part of this Agreement and shall have the same effect of this Agreement.

Article 31. If any terms or conditions of this Agreement contradict with any laws or regulations, such laws and regulations shall prevail.

Article 32. The parties may enter into other agreements for any unsettled matters under this Agreement. If there is no agreement addressing an unsettled matter under the Agreement, the matter shall be handled according to applicable laws, regulations or Party A’s internal rules.

Article 33. Supplemental Articles

N/A

Article 34. This Agreement shall be executed in three duplicate originals. Party A shall hold two duplicate originals and Party B shall hold one duplicate original. This Agreement shall become effective upon execution by both parties.

Party A: Putian Jiateng Food Industry Co., Ltd. [seal]

/s/ Jianshan Yao

Party B: Chaotang Li

/s/ Chaotang Li

Signing Date:

Signing Place:

EX-10.12

Exhibit 10.12

Employment Agreement

of Fujian Grand Farm Foods Development Co., Ltd.

Party A: Fujian Grand Farm Foods Development Co., Ltd. (hereafter referred to as “Party A”)

Address: No. 2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, China

Legal Representative or authorized signer: Jianbing Yao

Party B: Biyun Huang (hereafter referred to as “Party B”)

ID: xxxxxxxx

Address: No. 528 South Xiecheng Blvd. Room 7-1004, Cheng Xiang District, Putian

Phone: xxxxxxxx

This Employment Agreement (the “Agreement”) is entered into by and between Party A and Party B pursuant to the Contract Law of the People’s Republic of China and other relevant laws and regulations.

Section 1. Type and Term of Agreement

Article 1. The parties agree that this Agreement is an employment agreement. The term of the Agreement is 24 months, starting from October 1, 2010 to October 1, 2012. Upon the expiration of the Agreement, the parties may extend the term of the Agreement for an additional N/A year(s) based on mutual agreement. If the parties agree to enter into a new employment agreement for the extension, the new agreement shall be entered into within 30 days before the expiration date of this Agreement.

Section 2. Probation Period

Article 2. The probation period will be N/A months starting from N/A to N/A.

Section 3. Position of Employee and Place of Work

Article 3. Party A hereby agrees to hire Party B as the Chief Financial Officer of Party A.

Article 4. Party B shall be responsible for:

(1) Management of financial and accounting activities of Party A;

(2) Organization of the accounting department and recruitment of accountants; and

(3) Analysis of operation activities to improve the profitability of Party A.

Article 5. Party B shall work at Party A’s office in Putian, Fujian Province.

Article 6. Party B shall perform with due diligence the duties as a Chief Financial Officer and complete works assigned by Party A in a timely manner.

Section 4. Work Hours and Vacation

Article 7. Party B is not subject to any fixed work hours. However, Party B shall perform his/her work duties set forth in Article 4 with good faith and due diligence.

Article 8. Party B is entitled to statutory holidays and employee vacation times, including but not limited to, New Year’s Day, Chinese New Year, Labor Day, National Day and other statutory holidays, maternity leave, bereavement leave, honeymoon, etc.

Article 9. Party B shall work overtime as requested by Party A.

Section 5. Company Rules and Policies

Article 10. Party B shall comply with applicable laws and regulation and act in accordance with social and professional ethics. Party B shall not act against the reputation and benefit of Party A.

Article 11. Party B shall comply with internal rules and policies of Party A. Party A shall timely notify its employees of any change of internal rules and policies.

Article 12. Party B shall not engage in any outside work or activity that may have conflict of interest against Party A and shall protect Party A’s intellectual properties and trade secrets to which Party B has access.

Article 13. Until this Agreement is terminated, Party A shall have the right to impose administrative or monetary penalties on Party B pursuant to laws and company rules if Party B’s act violates company rules.

Section 6. Compensation

Article 14. Party B shall be entitled to compensation as follows:

(1) Party B is entitled to a monthly salary of RMB N/A during the probation period.

(2) After the probation period, Party B is entitled to a monthly salary of RMB 7,500 and a bonus based on the performance of the company.

(3) Party B’s monthly salary shall be payable on the 25th day of each month.

(4) Party B’s compensation for overtime shall be determined by both parties through further consultation.

(5) Party B is entitled to a raise of salary based on the local economy in accordance with employee compensation guidance issued by the local government.

(6) Party B’s salary is deductible for leaves.

Article 15. The parties shall pay the employee’s social insurance as follows:

(1) The parties shall pay their respective share of the employee’s social insurance. Party B’s payment of social insurance may be firstly paid by Party A and then deducted from Party B’s salary.

(2) Party A is responsible for the first-time aid for any incident or injury that Party B suffers during work hours and for which a request for work-related injury assessment is submitted to the labor and social insurance department within the stipulated time period. Party B is entitled to all statutory compensation and treatment for work-related injuries.

(3) Party B is entitled to all statutory employee benefits.

Section 7. Reimbursement

Article 16. Party A shall reimburse Party B for work-related traveling expenses.

Section 8. Amendment, Termination and Expiration of the Agreement

Article 17. The terms and conditions of this Agreement may be amended if any relevant laws and regulations are amended.

Article 18. In case that the performance of this Agreement is rendered impossible by any material change of circumstances, the parties may amend or terminate this Agreement upon mutual agreement.

Article 19. If Party A determines during Party B’s probation period that Party B is incompetent for the designated position, Party A shall give Party B notification of termination of the Agreement three days before the end of the probation period.

Article 20. Party A may terminate the Agreement and the employment of Party B immediately if:

(1) Party B gives false or fake personal information, including but not limited to: termination of employment with former employer, identity, residence registration, educational background, medical check, history of mental or infectious disease, history of dismissal by former employer, drug abuse, imprisonment or history of criminal liability, etc.;

(2) Party B violates company rules in a serious circumstance;

(3) Party B engages in serious negligence or favoritism, which causes a damage of RMB 5,000 or more to Party A;

(4) Party B establishes employment relationship with another employer, disregards Party A’s warning and fails to perform his/her duties as assigned by Party A, which causes a damage of RMB 5,000 or more to Party A;

(5) Party B is charged with a criminal offense;

(6) Either party terminates the Agreement with the other party’s consent;

(7) This Agreement is entered into or amended by Party B through fraud or coercion; or

(8) This Agreement is deemed void under any applicable laws and regulations.

Article 21. Party A may terminate the Agreement by giving Party B a 30-day written notice if:

(1) Party B is unable to perform the work assigned by Party A due to sickness or injury;

(2) Party B is incompetent to perform the work assigned by Party A after training or change of position and refuses to accept Party A’s arrangement for change of position;

(3) Party B’s designated position is no longer in existence due to merger, division, joint venture, change of ownership, change of operation or location of Party A;

(4) Party A has difficulties continuing its business; or

(5) The parties cannot reach an agreement on the amendment of the Agreement pursuant to Article 18.

Article 22. Party B may terminate the Agreement by giving Party A a 30-day written notice (or by a 3-day written notice if during the probation period). Party B may also terminate the Agreement at any time if:

(1) Party A fails to provide labor security or conditions as agreed in this Agreement;

(2) Party A fails to pay Party B’s salary on time or in the agreed amount;

(3) Party A fails to pay the required amount of social insurance for Party B;

(4) Party A’s internal rules or policies contradict with laws and regulations and harm the benefit of employee;

(5) This Agreement is rendered unenforceable according to section 1 of Article 26; or

(6) Any situation, under which the employee has the right to terminate the Agreement pursuant to applicable laws and regulations, occurs.

Party B may terminate this Agreement immediately without notice if Party A forces Party B to work by threat, violence, or detention, or Party A forces Party B to work in danger.

Article 23. The Agreement shall be terminated if:

(1) The parties cannot reach an agreement on renewal of the Agreement upon the expiration of the Agreement;

(2) As agreed by the parties, an event that triggers the termination of the Agreement happens;

(3) Party B is temporarily unable to perform his/her duties under the Agreement for 15 consecutive days due to, including but not limited to, detention by police, off-duty training program, engagement in public service activities, etc.;

(4) Party B joins the military or is committed to other statutory duties; or

(5) The Agreement must be terminated under any applicable laws and regulations.

Sectin 9. Parties’ Duties Upon Termination of the Agreement

Article 24. Upon termination of the Agreement, Party B is obligated to:

(1) Complete transition work with the successor designated by Party A;

(2) Return office supplies, documents and equipment to Party A;

(3) Return all material information of Party A;

(4) Coordinate with Party A to clear all debts between the parties;

(5) Complete all paperwork in connection with resignation required by Party A; and

(6) Complete or handover all unfinished matters.

Article 25. Upon termination of the Agreement, Party A is obligated to:

(1) Prepare all paperwork and procedure for the termination of employment of Party B; and

(2) Issue work evaluation for Party B upon Party B’s request.

Section 10. Economic Compensation and Damages

Article 26. If Party B fails to give Party A the 30-day notice for his/her resignation, Party A shall pay Party B’s earned salary after the transition of work is complete.

Article 27. If Party B causes economic damage to Party A by failing to repay his/her debt to Party A or by terminating the Agreement in breach of any term of the Agreement, Party B shall be subject to compensating Party A for such damages, and Party A has the right to deduct such amount from Party B’s salary or bonus. If Party B’s salary or bonus is not sufficient for the compensation, Party A is entitled to make claim against Party B for the deficient amount.

Section 11. Confidentiality

Article 28. Party B shall keep confidential any of Party A’s trade secrets. Trade secret means any information that is not generally known, by which Party A can obtain an economic interest, and is protected by Party A from disclosure, including but not limited to:

(1) Technology information, including technology and project design, formula, technique flowchart, statistic, computer software, database, experiment report, drawing, sample, module, operation manual, documents and business communications;

(2) Operation information, including customer list, marketing plan, purchasing materials, pricing policies, undisclosed financial information, compensation, supplier information, sales policies, bidding materials, etc.; and

(3) Any other information that Party A is obligated to keep confidential pursuant to laws and agreements.

Section 12. Dispute Resolution

Article 29. Any dispute arising from performance of this Agreement may be resolved through consultation or submitted to a labor arbitration committee at Party A’s location or submitted to a court of law at Party A’s location.

Chapter 13. Miscellaneous

Article 30. The internal rules and policies of the company (including but not limited to employee’s manual, description of duty, training agreement, confidential agreement and security code) are integral part of this Agreement and shall have the same effect of this Agreement.

Article 31. If any terms or conditions of this Agreement contradict with any laws or regulations, such laws and regulations shall prevail.

Article 32. The parties may enter into other agreements for any unsettled matters under this Agreement. If there is no agreement addressing an unsettled matter under the Agreement, the matter shall be handled according to applicable laws, regulations or Party A’s internal rules.

Article 33. Supplemental Articles

N/A

Article 34. This Agreement shall be executed in three duplicate originals. Party A shall hold two duplicate originals and Party B shall hold one duplicate original. This Agreement shall become effective upon execution by both parties.

Party A: Fujian Grand Farm Foods Development Co., Ltd. [seal]

/s/ Jianshan Yao

Party B: Biyun Huang

/s/ Biyun Huang

Signing Date: October 1, 2010

Signing Place:

EX-10.13

Exhibit 10.13

Confidentiality and Non-compete Agreement

This Confidentiality and Non-compete Agreement (the “Agreement”) is entered into by and between the parties listed below on April 1, 2010 in Putian, Fujian Province, People’s Republic of China (“China”).

Party A: Fujian Grand Farm Foods Development Co., Ltd.

Address: No. 2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian, Fujian Province, China

Legal Representative or authorized signer: Jianbing Yao

Party B: Biyun Huang

ID: xxxxxxxxx

Address: No. 528 South Xiecheng Blvd. Room 7-1004, Cheng Xiang District, Putian

Whereas Party B is an employee of Party A and receives compensation for services it provides to Party A, the parties hereby agree to enter into this Agreement. In this Agreement, the term “Group” includes Party A and any entities that Party A has established or will establish, including any shareholding company, parent company, subsidiary and affiliate of Party A, or any subsidiary or branch of Party A’s shareholding company.

1. Employment. The parties have entered into another agreement to memorize the employment relationship between the parties. This Agreement shall not be interpreted as an acknowledgement or proof of such employment relationship.

2. Business:

3. Confidential Information: The term “confidential information” in this Agreement shall include:

3.1 Information of Party A, including any information relating to technology, special techniques, operation, or other classified information, especially:

3.1.1 Technique information, which includes all information on production and sales of products, such as technique improvement plan, project design, circuit design, manufacturing process, formula, flowchart, data, computer software, database, lab report, drawing, sample, module, instrument, handbook, confidential business correspondence or other information that may be deemed as trade secret;

3.1.2 Operation information, which includes all information relating to operating activities of Party A, such as marketing strategies, supply channels, purchasing plans, pricing policies, confidential financial information, contracts, information of purchasers, suppliers and customers;

3.1.3 Information on public listing that is only known by insiders, such as unfinished or undisclosed registration statement, due diligence memo, financial data, description of business, business plan, strategic plan, presentation, training materials, press release, speech script, video, correspondence with investment banker, legal counsel, auditor, SEC staff or other parties;

3.1.4 Any information that Party A is obligated to keep confidential pursuant to a contract;

3.1.5 Any oral communication between the parties regarding confidential information (Party B shall deliver such information in a written form to Party A within 15 days after the communication); and

3.1.6 Any other information that is protected from access of a third party through reasonable means.

3.2 Third party information, including any information obtained or will be obtained by Party B from subsidiary or affiliate of Party A and/or the Group. Party A and/or other member of the Group shall have the obligation to keep such information confidential and use the information for the designated purposes. Party B shall not disclose such information to any individual, partnership or company unless such disclosure is necessary to conduct his/her work assigned by Party A or such disclosure is required pursuant to a contract entered into between Party A and a third party.

4. Forms of Trade Secret

4.1 Any confidential information, in the form of paper or electronic file, material, photo, chart, note, report, letter, fax, cassette, CD, device or any other carrier, held or used by Party B in connection with Party B’s work duties is a property of Party A, no matter whether or not such information has commercial value to Party A.

4.2 Upon the termination of his/her employment, Part B shall return all above said information to Party A and shall not duplicate or keep such information or give the information to a third party.

4.3 If the above said confidential information is carried by Party B’s device, Party B shall give such device to Party A upon termination of his/her employment and Party A shall pay Party B for such device.

5. Confidentiality

5.1 During his/her employment, Party B shall take reasonable measures to protect the confidential information of Party A by following required operating process and taking sufficient precautions.

5.2 During his/her employment and upon termination of the employment, Party B shall not disclose the confidential information of Party A, unless such disclosure is for the benefit of Party A or the Group. Party B shall not use the confidential information or disclose, distribute, publish, transfer such confidential information to any individual, partnership or company (including other employees of Party A who have no access to such confidential information according to Party A’s internal rules) unless is otherwise authorized by Party A in writing. Party B agrees to protect the confidential information of Party A to the same extent as protecting his/her personal private information and shall not use, disclose, publish or transfer such information without Party A’s prior consent.

5.3 Party B shall not take the confidential information outside Party A’s office without Party A’s prior written consent unless it is for the benefit of Party A and the Group.

5.4 Party B shall not disclose the confidential information to a third party unless such disclosure is necessary for the business between the third party and Party A. The third party shall firstly execute a confidential agreement before receiving such information.

5.5 Any third party, including the management, employee and counsel of the third party, may be given access to the confidential information of Party A under the condition that all people who are given access to the confidential information must keep the information confidential.

5.6 Unless for the benefit of Party A or the Group, Party B shall not disclose or discuss his or her salary, bonus, benefit, option or other compensation with a third party other than Party B’s family members.

6. Intellectual Property

6.1 Ownership and use. Any invention, authorship, creation, innovation and trade secret created by Party B prior to his/her employment with Party A as listed in Exhibit A (“Pre-employment Work”) is a property of Party B and has not been licensed or transferred to Party A. If Party B combines any of his/her Pre-employment Work with Party A’s product, program or device owned during employment, Party A shall have nonexclusive and irrevocable right to use the Pre-employment Work permanently and universally as part of the said product, program or device, and shall also have the right to improve, use or sell the Pre-employment Work as part of the said product, or device.

6.2 Disclosure. Party B agrees that during his/her employment, any invention, authorship, creation, innovation, design, discovery, idea, trademark, trade secret, program, know-how or other work created by Party B alone or with others (“In-Employment Work”), registrable or unregistrable as intellectual property, shall be disclosed to Party A or designee of Party A.

6.3 Intellectual Property. The parties agree that Party A shall have title to any In-Employment Work created by Party B using materials and information provided by Party A. Any work relating to Party B’s duties created within one year after the termination of Party B’s employment shall also be deemed as In-Employment Work. Party B understands and agrees that Party A has the right to commercialize and sell any In-employment Work for the sole benefit of Party A or other member of the Group. Party B may claim the title to any In-employment Work created by Party B by submitting a request in writing and will have the title to the In-employment Work upon Party A’s consent. If a work created by Party B is not an In-employment Work but is relating to the business of Party A, Party A or other member of the Group shall have the priority to purchase all or part of the work within three months after Party B disclosing the work to Party A.

6.4 Maintenance of Files. Party B agrees to maintain the files prepared by Party B alone or with others during his/her employment. Such files may be records, briefs, drawings or in any other format. Party A shall have the right to obtain such files and shall have the sole ownership of such files.

6.5 Registration of Patent and Copyright. Party B agrees to assist Party A or the designee of Party A with registration of patent, copyright or other intellectual property in one or all countries at Party A’s costs. Party B’s duties include preparing and submitting all paperwork for registration and providing necessary proof upon transfer or license of such intellectual properties by Party A, or the successor, transferee or nominee of Party A. Party B further agrees that Party B will continue to perform the above said duties, if necessary, with due diligence after termination of his/her employment.

7. Conflict of Interest. During his/her employment, Party B shall provide his/her services on a full time basis and shall not directly or indirectly provide services to or engage with other entities that conduct or will conduct similar business with Party A/Group and shall not participate in any activities that may have conflict to Party B’s employment. Without the unanimous written consent of the board of directors of Party A, Party B shall not own or hold any equity or interest of any other companies that conduct or will conduct similar business with Party A/Group during Party B’s employment, unless Party B has disclosed his/her ownership of such equity or interest to Party A before executing this Agreement.

8. Non-compete Clause

8.1 Party B agrees that, upon voluntary or involuntary termination of his/her employment for any cause, Party B shall turn in all information held by Party B relating to Party B’s duty, including files, records, information, materials, instruments, data, notes, reports, plans, index, letters and correspondences, statements, drawings, blueprints and memos (include but not limited to the duplicate of the above listed items), and complete all necessary procedures and paperwork required by Party A to terminate the employment. Party B shall guarantee not to disclose, maintain, recreate, duplicate or circulate the confidential information of Party A upon termination of his/her employment.

8.2 Party B agrees that, during his/her employment or within three months (unless Party A agrees to a shorter term) upon voluntary or involuntary termination of his/her employment for any cause (“Non-compete Period”), unless waived or consented otherwise by the board of directors of Party A by unanimous written consent, Party B shall not: (i) act as a shareholder, partner, employee, counsel, administrator, director, manager, agent, cooperator, or investor of an entity that has conflict of interest with or conduct similar business as Party A or the Group; (ii) directly or indirectly own, purchase, set up or solicit a business that is similar to or competes with the business of Party A or the Group; or (iii) participate in establishing, designing, financing, acquiring, leasing, operating, managing, investing, counseling, or engaging in insider activity for a business that is similar to or competes with the business of Party A or the Group. The above listed restrictions shall apply to any activities conducted by Party B in (a) mainland of China; (b) Taiwan; (c) Hong Kong; and (d) Macau (collectively “Jurisdictions”).

8.3 Article 8.1 is applicable in any cities, counties, towns and countries in the Jurisdictions. If an arbitration court in any of the Jurisdictions holds a part of the Agreement unenforceable, such part shall be excluded from this Agreement and the remainder of the Agreement shall still apply. If the Non-compete Period is longer than the maximum statutory time applicable in a certain Jurisdiction, the Non-compete Period shall be adjusted to the maximum time as allowed by the law of the Jurisdiction.

8.4 Party B shall be entitled to compensation for complying Article 8 upon termination of his/her employment (“Compensation”). The Compensation shall be payable each month during the Non-compete Period in an amount equivalent to Party B’s monthly salary in the last month of Party B’s employment. The amount of Compensation shall be adjusted according to applicable laws and regulations. If Party A waives its right under the non-compete clause or agrees to a shorter Non-compete Period, the amount of Compensation shall be decreased on a pro rata basis.

8.5 During the Non-compete Period, Party A may choose to exempt Party B from the non-compete clause under Article 8.1 through a written consent or by not paying the Compensation. Once Party A fails to pay the Compensation under Article 8.4, Party B shall be exempted from the non-compete clause. Under such circumstance, Party A is not obligated to give any notice to Party B for the exemption and Party B shall not claim for the Compensation in any means (including but not limited to through arbitration or litigation).

9. Return of Files. Party B agrees that all materials and documents, such as designs, files, data, records, reports, written plans, lists, letters, statements, drawings, brief, instruments and other documents or copies of the said documents that belong to Party A or the Group, or successor or transferee of Party A or the Group used by Party B during his/her employment shall be returned to Party A. Party B shall not keep, duplicate or transfer such documents.

10. Breach of Agreement. Party B shall compensate for any loss caused to Party A by Party B’s breach of this Agreement. Party A may deduct such compensation from Party B’s paycheck upon Party B’s consent.

11. Disclose to New Employer. Party B agrees that upon termination of his/her employment, Party A may disclose the terms and conditions under this Agreement to Party B’s new employer.

12. Non-solicitation of Employee. Party B agrees that he/she will not, for a period of 24 months after the termination of his/her employment, directly or indirectly, approach, solicit, entice or attempt to approach, solicit or entice any of the other employees of Party A or the Group to leave the employment of Party A.

13. Representation. Party B represents that his/her performance of this Agreement will not conflict with his/her obligation of confidentiality for information obtained prior to his/her employment with Party A and Party B has never entered into and will not enter into any other oral or written agreement that may contradict his/her obligation under this Agreement.

14. General Terms and Conditions

14.1 Applicable Laws. The execution, effect, interpretation and performance of this Agreement and any conflict arising from the performance of this Agreement shall be governed by laws and regulations of China and shall not be affected by the principles of selection of laws and conflict of laws.

14.2 Notice. The parties’ addresses indicated on the first page of this Agreement shall be used as mailing address required for giving notices according to this Agreement. If the notice is delivered in person, or by express or prepaid mail, the date that the notice arrives at the receiver’s address shall be deemed as the date of notice. If the notice is sent by fax, the date of sending the fax shall be deemed as the date of notice.

14.3 Complete Agreement. This Agreement sets forth all agreements between the parties on matters in connection with confidentiality and non-compete and shall supersede and cover all prior agreements between the parties in this respect. Any amendment or revision to this Agreement shall be deemed unenforceable unless otherwise agreed by the parties in wring. Any change of Party B’s work duties, salary or compensation shall not affect the effect and scope of this Agreement.

14.4 Collateral Agreement. This Agreement shall be deemed and interpreted as a collateral agreement of the Employment Agreement entered into by and between the parties. Any unsettled matter under this Agreement shall be resolved based on law or, if not provided by law, on the Employment Agreement. The effect of this Agreement shall survive the termination of the Employment Agreement.

14.5 Severability. If any provision under this Agreement is rendered or deemed unenforceable, the remainder of this Agreement shall still apply.

14.6 Successor and Assignee. This Agreement shall be enforceable to successor, heir, manager or other legal representative of Party B and shall protect the interest of Party A and the successors and assignees of Party A.

14.7 Duplicate Originals. This Agreement shall be executed into more than one duplicate originals. All duplicate originals shall have the equivalent effect.

Party A: Fujian Grand Farm Foods Development Co., Ltd. [seal]

/s/ Jianshan Yao

Party B: Biyun Huang

/s/ Biyun Huang

Exhibit A

Pre-employment Work

None.

EX-10.14

Exhibit 10.14

November 30, 2010

2010年11月 30日

Grand Farm Inc.

No.2089 East Hanhua Road, Hanjiang District, Putian, Fujian Province,

People's Republic of China

Tel:  (86) 594 336 5158

天下农庄有限公司

中国福建省莆田市涵江区涵华东路2089号

电话：（86）594 3365158

Re: Board of Directors – Offer Letter 董事会 ---- 聘用信

Dear Mr. Qinglong Li:

敬爱的  李庆龙  先生：

Grand Farm Inc., a Cayman Island corporation (the “Company”), is pleased to offer you the Independent Director position on its Board of Directors (the “Board”).  Within the board committees, your will serve as the members of Audit Committee, Nominating and Corporate Governance Committee and Compensation Committee. The Board’s purpose is to oversee or direct the property, affairs and business of the Company.

天下农庄有限公司是一家开曼群岛公司(“公司”)，很高兴为您提供董事会中的独立董事职位。在董事会的委员会中，您将担任审计委员会成员，提名及公司治理委员会成员和薪酬委员会成员。董事会的职责是监督或指导公司的财产、事务和公司业务。

Should you chose to accept this position as a member of the Board, this letter shall constitute an agreement between you and the Company (the “Agreement”) and contains all the terms and conditions relating to the services you are to provide.

如果您选择担任这个职位，作为董事会的成员，这封信件将构成在您和公司之间的协议(“协议”)，并且包含所有您将提供的服务的相关条款。

1.           Term.  This Agreement shall be for the ensuing year, commencing on November 30, 2010 (the “Effective Date”). Your term as director shall continue until your successor is duly elected and qualified.  The position shall be up for re-election each year at the annual shareholder’s meeting and upon re-election, the terms and provisions of this agreement shall remain in full force and effect unless otherwise revised on such terms as mutually agreed to by you and the Company.

1.           期限。                      该协议是为未来一年期间准备的，始于2010年11月 30 日(“生效日”)。您作为董事的任期将在适当选出合格的继任者之后终止。年度股东会议上将改选董事，改选时该协议条款仍然有效，除非双方均同意修改原协议内容。

Board of Directors Offer Letter

董事会聘用书

1

2.           Services.  You shall render services in the area of overseeing or directing the Company’s property, affairs and business (hereinafter your “Duties”). Every year, the Board shall hold such number meetings at such times and locations as determined by the Chairman of the Board, and participate in the meetings via teleconference, video conference or in person.  Upon the reasonable request of the Chairman, you agree to attend one or more board meetings in person (each, an “Attended Meeting”).  You shall consult with the other members of the Board as necessary via telephone, electronic mail or other forms of correspondence.  In addition, you agree to be appointed to certain special committees of the Board, initially consisting of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, and participate as necessary, in person or via teleconference or video conference in the meetings of those special committees.

2.           服务。                      您应监督或指导公司的财产、事务和业务 (下称您的“职责”)。经由董事长同意，董事会每年将在指定时间和地点召开指定次数的会议。董事通过电话会议、电视会议或到现场参加会议。在主席的合理要求下，您同意亲自参加一个或多个董事会会议(每一次参加会议下称“出席的会议”)。如有需要，您可以通过电话、电子邮件或者书信的其他形式与其他的董事会成员协商。另外，您同意被任命为该董事会某些专门委员会的委员，包括审计委员会,薪酬委员会和提名及公司治理委员会。如有需要，亲自参加或者通过电话会议或电视电话会议参加专门委员会的会议。

3.           Services for Others.  You will be free to represent or perform services for other persons during the term of this Agreement.  However, you agree that you do not presently perform and do not intend to perform, during the term of this Agreement, similar Duties, consulting or other services for companies whose businesses are or would be, in any way, competitive with the Company (except for companies previously disclosed by you to the Company in writing).  Should you propose to perform similar Duties, consulting or other services for any such company, you agree to notify the Company in writing in advance (specifying the name of the organization for whom you propose to perform such services) and to provide information to the Company sufficient to allow it to determine if the performance of such services would conflict with areas of interest to the Company.

3.           为其他人提供的服务。                                           在协议期间，您可以自由的为其他人提供服务，但你承诺当前不执行和不打算执行对在任何情况下与公司竞争或有可能与公司竞争的企业的相似的职责，例如：咨询或者其他服务。(您以前在其他公司以书面形式提供的服务除外) 如果您想对其他同类公司提供相似服务，如咨询或者其他服务，您应事先以书面方式通知公司 (指出您所服务组织的名称)并提供足够信息给公司，以便公司决定该服务是否与公司利益产生冲突。

4.           Compensation.  In consideration for your service as a member of the Board, the Company agrees to pay you monthly salary in cash at the following annual compensation in cash (the “Annual Compensation”) for 2011:

Service Description	Amount (in U.S. dollars)
Base Compensation	$	9,000
Member of Audit Committee	$	2,000
Member of Compensation Committee	$	2,000
Member of Nominating and Corporate Governance Committee	$	2,000
Total:	$	15,000

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4.           薪酬。                                考虑到您作为董事会的成员所提供的服务，公司同意在2011年以每月现金工资的形式支付您以下年薪(下称“年薪”)：

服务描述	金额(美元)
基本报酬	$	9,000
审计委员会成员	$	2,000
薪酬委员会成员	$	2,000
提名及公司治理委员会成员	$	2,000
共计：	$	15,000

If the Chairman requests your presence at an Attended Meeting, the Company agrees to reimburse all of your travel and other reasonable expenses relating to the Attended Meeting.  In addition, the Company agrees to reimburse you for reasonable expenses that you incur in connection with the performance of your duties as a director of the Company.

如果董事会主席要求您出席现场会议，公司同意负担您参加会议的差旅费和其他合理的费用。此外，公司同意支付您履行董事职责中产生的相关合理费用。

Your compensation as a director and for service on committees in any future periods is subject to the determination of the Board of Directors, and may differ in future periods should you continue to serve on the board.

您作为董事和委员会成员未来的薪酬由董事会决定，如果您继续在董事会任职，未来的薪酬有可能变化。

5.           D&O Insurance Policy. The Company agrees to obtain, within a reasonable time, Directors and Officers Liability Insurance from an internationally recognized underwriter with terms of coverage appropriate for a company of our size and nature, which shall be maintained throughout the term of this Agreement.

5.            董事责任险政策。公司同意在合理时间内，为董事和办公人员在国际公认的保险商处办理与公司规模相符的责任保险，本保险在协议期限内始终有效。

6.           No Assignment.  Because of the personal nature of the services to be rendered by you, this Agreement may not be assigned by you without the prior written consent of the Company.

6.           无分配权。由于您将提供个人性质的服务，该协议如没有公司的预先书面同意，则不由您分配。

7.           Confidential Information; Non-Disclosure.  In consideration of your access to the premises of the Company and/or you access to certain Confidential Information of the Company, in connection with your business relationship with the Company, you hereby represent and agree as follows:

7.           保密信息; 非披露性。                                           考虑到您与公司的业务关系，从而有获知公司保密信息的优先权，在此您将同意以下内容：

a.           Definition.  For purposes of this Agreement the term “Confidential Information” means:

i.           Any information which the Company possesses that has been created, discovered or developed by or for the Company, and which has or could have commercial value or utility in the business in which the Company is engaged; or

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ii.           Any information which is related to the business of the Company and is generally not known by non-Company personnel.

iii.           By way of illustration, but not limitation, Confidential Information includes trade secrets and any information concerning products, processes, formulas, designs, inventions (whether or not patentable or registrable under copyright or similar laws, and whether or not reduced to practice), discoveries, concepts, ideas, improvements, techniques, methods, research, development and test results, specifications, data, know-how, software, formats, marketing plans, and analyses, business plans and analyses, strategies, forecasts, customer and supplier identities, characteristics and agreements.

a、              定义。                      本协议中“保密信息”定义如下：

i. 涉及公司的，任何具有商业价值或商业用途的信息；

ii. 一般不为公司以外人员所知的，任何涉及公司业务的信息。

iii. 保密信息包括但不仅限于以下范围：商业机密以及任何涉及产品、工序、配方、设计、发明（不管是否申请专利或根据相关法案登记在册，或是否应用于实际操作中）、概念、产品改进、技术、方法、研究、测试结果、规格、资料、软件、营销方案及分析、经营计划及分析、策略、前景、客户及供应商身份、特点、协议等等的信息。

b.           Exclusions.  Notwithstanding the foregoing, the term Confidential Information shall not include:

i.           Any information which becomes generally available to the public other than as a result of a breach of the confidentiality portions of this agreement, or any other agreement requiring confidentiality between the Company and you;

ii.           Information received from a third party in rightful possession of such information who is not restricted from disclosing such information; and

iii.           Information known by you prior to receipt of such information from the Company, which prior knowledge can be documented.

b、              不包括保密协议不包括以下内容：

i、 不违反该保密协议或其他公司与个人达成的保密协议，且为大众所知的信息；

ii、           不为本协议所限的，且合法的从第三方处获知的信息；

iii、             能被证明是在公司告知相关信息之前已获知的信息。

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c.           Documents. You agree that, without the express written consent of the Company, you will not remove from the Company’s premises, any notes, formulas, programs, data, records, machines or any other documents or items which in any manner contain or constitute Confidential Information, nor will you make reproductions or copies of same.  In the event you receive any such documents or items by personal delivery from any duly designated or authorized personnel of the Company, you shall be deemed to have received the express written consent of the Company.  In the event that you receive any such documents or items, other than through personal delivery as described in the preceding sentence, you agree to inform the Company promptly of your possession of such documents or items.  You shall promptly return any such documents or items, along with any reproductions or copies to the Company upon the Company’s demand or upon termination of this agreement.

c、           档案没有公司的明确书面许可，不允许带离或复制公司涉及到保密信息的任何票据、配方、计划、资料、记录、机械装置或任何其他文件。收到公司相关授权人员给予的文件即视为得到明确的书面许可。在得到任何此类文件后，除非如以上所述途径通过个人传送，否则需及时告知公司您对该文件的所有。如公司要求，您需及时归还该文件及其复印件等。

d.           No Disclosure.  You agree that you will hold in trust and confidence all Confidential Information and will not disclose to others, directly or indirectly, any Confidential Information or anything relating to such information without the prior written consent of the Company, except as maybe necessary in the course of his business relationship with the Company.  You further agree that you will not use any Confidential Information without the prior written consent of the Company, except as may be necessary in the course of your business relationship with the Company, and that the provisions of this paragraph (d) shall survive termination of this agreement.

d、              不披露您将对所有的保密信息进行保密，除非是与公司有业务关系且必要的情况，否则在未得到公司事先的书面许可前，不得对任何其他人直接或间接地披露任何保密信息或相关的信息。在未得到公司事先书面许可条件下，不得应用这些保密信息，除非是在您和公司业务往来时有此必要得情况，则该条款在此无效。

8.           Certain Representations.  You represent and agree that you are accepting the Shares for your own account and not with a view to or for sale in connection with any distribution thereof.  You understand that the Shares will be subjected to the restrictions in the Company’s Articles of Incorporation and Bylaws and will not be freely transferable.  You further represent that you are an “accredited” investor as this term is defined in the Securities Act, and that by reason of your business or financial experience, you have the capacity to protect your own interest in connection with receiving the Shares as compensation.  You further represent that you were not solicited by publication of any advertisement in connection with the receipt of the Shares and that you have consulted tax counsel as needed regarding the Shares.

8.           特定声明您将同意以自身账户接受股权，并保证不转手任何分配到的份额。您明了股权将会受限于公司法和公司的规章制度，并不能随意转让。此外，您代表的是证券法案定义的“认可”的投资者，由于您的业务或财务经验，您有能力保护自己有关接受股权形式薪酬相关的利益。您还将表明您未知受到任何有关获得股份相关的公开广告的唆使，且您就股权的问题咨询税务顾问。

9.           Independent Contractor.  In performing your services on the Board, you will be an independent contractor and not an employee of the Company. Except as set forth in this Agreement, you will not be entitled to any additional compensation or participate in any benefit plans of the Company in connection with your services on the Board.  You may not bind the Company or act as a principal or agent thereof.

9.           独立立约人在服务于董事会上，您将会是独立立约人，而非公司的员工。除非如上文另有所述，您将不会被授予额外的补偿或参与任何与您服务于董事会有关的公司福利计划。您不能约束公司或担任主要负责人或代理。

10.           Entire Agreement; Amendment; Waiver.  This Agreement expresses the entire understanding with respect to the subject matter hereof and supersedes and terminates any prior oral or written agreements with respect to the subject matter hereof. Any term of this Agreement may be amended and observance of any term of this Agreement may be waived only with the written consent of the parties hereto.  Waiver of any term or condition of this Agreement by any party shall not be construed as a waiver of any subsequent breach or failure of the same term or condition or waiver of any other term or condition of this Agreement.  The failure of any party at any time to require performance by any other party of any provision of this Agreement shall not affect the right of any such party to require future performance of such provision or any other provision of this Agreement.

10.           协议的修订与弃用这个协议描述了所有的相关意见，也是对以往任何其它口头或书面协议的终结和替换。经双方书面同意，本协议的任何条款都可能再修正或弃用。一方对本协议任一条款的弃权将不被认定为另一方对同一条款的弃权。无论何时，一方未能要求另一方执行本协议的任意条款，将不影响该方所要求的在未来对本协议该条款的执行。

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The Agreement has been executed and delivered by the undersigned and is made effective as of the date set first set forth above.

此协议将自以下签字人署名和设定日期后开始生效执行。

Sincerely,  诚挚，

Grand Farm Inc.

由 By: /s/ Jianshan Yao_______________

AGREED AND ACCEPTED:

同意并接受：

/s/ Qinglong Li____________

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EX-10.15

Exhibit 10.15

November 30, 2010

2010年11月 30 日

Grand Farm Inc.

No.2089 East Hanhua Road, Hanjiang District, Putian, Fujian Province,

People's Republic of China

Tel:  (86) 594 336 5158

天下农庄有限公司

中国福建省莆田市涵江区涵华东路2089号

电话：（86）594 3365158

Re: Board of Directors – Offer Letter 董事会 ---- 聘用信

Dear Mr. Feng Liang:

敬爱的  梁锋  先生：

Grand Farm Inc., a Cayman Island corporation (the “Company”), is pleased to offer you the Independent Director position on its Board of Directors (the “Board”).  Within the board committees, your will serve as the Chairman of Compensation Committee and members of Audit Committee and Nominating and Corporate Governance Committee. The Board’s purpose is to oversee or direct the property, affairs and business of the Company.

天下农庄有限公司是一家开曼群岛公司(“公司”)，很高兴为您提供董事会中的独立董事职位。在董事会的委员会中，您将担任薪酬委员会主席，审计委员会成员和提名及公司治理委员会成员。董事会的职责是监督或指导公司的财产、事务和公司业务。

Should you chose to accept this position as a member of the Board, this letter shall constitute an agreement between you and the Company (the “Agreement”) and contains all the terms and conditions relating to the services you are to provide.

如果您选择担任这个职位，作为董事会的成员，这封信件将构成在您和公司之间的协议(“协议”)，并且包含所有您将提供的服务的相关条款。

1.           Term.  This Agreement shall be for the ensuing year, commencing on November 30, 2010 (the “Effective Date”). Your term as director shall continue until your successor is duly elected and qualified.  The position shall be up for re-election each year at the annual shareholder’s meeting and upon re-election, the terms and provisions of this agreement shall remain in full force and effect unless otherwise revised on such terms as mutually agreed to by you and the Company.

1.           期限。                      该协议是为未来一年期间准备的，始于2010年11月 30日(“生效日”)。您作为董事的任期将在适当选出合格的继任者之后终止。年度股东会议上将改选董事，改选时该协议条款仍然有效，除非双方均同意修改原协议内容。

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2.           Services.  You shall render services in the area of overseeing or directing the Company’s property, affairs and business (hereinafter your “Duties”). Every year, the Board shall hold such number meetings at such times and locations as determined by the Chairman of the Board, and participate in the meetings via teleconference, video conference or in person.  Upon the reasonable request of the Chairman, you agree to attend one or more board meetings in person (each, an “Attended Meeting”).  You shall consult with the other members of the Board as necessary via telephone, electronic mail or other forms of correspondence.  In addition, you agree to be appointed to certain special committees of the Board, initially consisting of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, and participate as necessary, in person or via teleconference or video conference in the meetings of those special committees.

2.           服务。                      您应监督或指导公司的财产、事务和业务 (下称您的“职责”)。经由董事长同意，董事会每年将在指定时间和地点召开指定次数的会议。董事通过电话会议、电视会议或到现场参加会议。在主席的合理要求下，您同意亲自参加一个或多个董事会会议(每一次参加会议下称“出席的会议”)。如有需要，您可以通过电话、电子邮件或者书信的其他形式与其他的董事会成员协商。另外，您同意被任命为该董事会某些专门委员会的委员，包括审计委员会,薪酬委员会和提名及公司治理委员会。如有需要，亲自参加或者通过电话会议或电视电话会议参加专门委员会的会议。

3.           Services for Others.  You will be free to represent or perform services for other persons during the term of this Agreement.  However, you agree that you do not presently perform and do not intend to perform, during the term of this Agreement, similar Duties, consulting or other services for companies whose businesses are or would be, in any way, competitive with the Company (except for companies previously disclosed by you to the Company in writing).  Should you propose to perform similar Duties, consulting or other services for any such company, you agree to notify the Company in writing in advance (specifying the name of the organization for whom you propose to perform such services) and to provide information to the Company sufficient to allow it to determine if the performance of such services would conflict with areas of interest to the Company.

3.           为其他人提供的服务。                                           在协议期间，您可以自由的为其他人提供服务，但你承诺当前不执行和不打算执行对在任何情况下与公司竞争或有可能与公司竞争的企业的相似的职责，例如：咨询或者其他服务。(您以前在其他公司以书面形式提供的服务除外) 如果您想对其他同类公司提供相似服务，如咨询或者其他服务，您应事先以书面方式通知公司 (指出您所服务组织的名称)并提供足够信息给公司，以便公司决定该服务是否与公司利益产生冲突。

4.           Compensation.  In consideration for your service as a member of the Board, the Company agrees to pay you monthly salary in cash at the following annual compensation (the “Annual Compensation”) for 2011:

Service Description	Amount (in U.S. dollars)
Base Compensation	$	9,000
Chairman of Compensation Committee	$	4,000
Member of Audit Committee	$	2,000
Member of Nominating and Corporate Governance Committee	$	2,000
Total:	$	17,000

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4.           薪酬。                                考虑到您作为董事会的成员所提供的服务，公司同意在2011年以每月现金工资的形式支付您以下年薪(下称“年薪”)：

服务描述	金额(美元)
基本报酬	$	9,000
薪酬委员会主席	$	4,000
审计委员会成员	$	2,000
提名及公司治理委员会成员	$	2,000
共计：	$	17,000

If the Chairman requests your presence at an Attended Meeting, the Company agrees to reimburse all of your travel and other reasonable expenses relating to the Attended Meeting.  In addition, the Company agrees to reimburse you for reasonable expenses that you incur in connection with the performance of your duties as a director of the Company.

如果董事会主席要求您出席现场会议，公司同意负担您参加会议的差旅费和其他合理的费用。此外，公司同意支付您履行董事职责中产生的相关合理费用。

Your compensation as a director and for service on committees in any future periods is subject to the determination of the Board of Directors, and may differ in future periods should you continue to serve on the board.

您作为董事和委员会成员未来的薪酬由董事会决定，如果您继续在董事会任职，未来的薪酬有可能变化。

5.           D&O Insurance Policy. The Company agrees to obtain, within a reasonable time, Directors and Officers Liability Insurance from an internationally recognized underwriter with terms of coverage appropriate for a company of our size and nature, which shall be maintained throughout the term of this Agreement.

5.            董事责任险政策。公司同意在合理时间内，为董事和办公人员在国际公认的保险商处办理与公司规模相符的责任保险，本保险在协议期限内始终有效。

6.           No Assignment.  Because of the personal nature of the services to be rendered by you, this Agreement may not be assigned by you without the prior written consent of the Company.

6.           无分配权。由于您将提供个人性质的服务，该协议如没有公司的预先书面同意，则不由您分配。

7.           Confidential Information; Non-Disclosure.  In consideration of your access to the premises of the Company and/or you access to certain Confidential Information of the Company, in connection with your business relationship with the Company, you hereby represent and agree as follows:

7.           保密信息; 非披露性。                                           考虑到您与公司的业务关系，从而有获知公司保密信息的优先权，在此您将同意以下内容：

a.           Definition.  For purposes of this Agreement the term “Confidential Information” means:

i.           Any information which the Company possesses that has been created, discovered or developed by or for the Company, and which has or could have commercial value or utility in the business in which the Company is engaged; or

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ii.           Any information which is related to the business of the Company and is generally not known by non-Company personnel.

iii.           By way of illustration, but not limitation, Confidential Information includes trade secrets and any information concerning products, processes, formulas, designs, inventions (whether or not patentable or registrable under copyright or similar laws, and whether or not reduced to practice), discoveries, concepts, ideas, improvements, techniques, methods, research, development and test results, specifications, data, know-how, software, formats, marketing plans, and analyses, business plans and analyses, strategies, forecasts, customer and supplier identities, characteristics and agreements.

a、              定义。                      本协议中“保密信息”定义如下：

i. 涉及公司的，任何具有商业价值或商业用途的信息；

ii. 一般不为公司以外人员所知的，任何涉及公司业务的信息。

iii. 保密信息包括但不仅限于以下范围：商业机密以及任何涉及产品、工序、配方、设计、发明（不管是否申请专利或根据相关法案登记在册，或是否应用于实际操作中）、概念、产品改进、技术、方法、研究、测试结果、规格、资料、软件、营销方案及分析、经营计划及分析、策略、前景、客户及供应商身份、特点、协议等等的信息。

b.           Exclusions.  Notwithstanding the foregoing, the term Confidential Information shall not include:

i.           Any information which becomes generally available to the public other than as a result of a breach of the confidentiality portions of this agreement, or any other agreement requiring confidentiality between the Company and you;

ii.           Information received from a third party in rightful possession of such information who is not restricted from disclosing such information; and

iii.           Information known by you prior to receipt of such information from the Company, which prior knowledge can be documented.

b、              不包括保密协议不包括以下内容：

i、 不违反该保密协议或其他公司与个人达成的保密协议，且为大众所知的信息；

ii、           不为本协议所限的，且合法的从第三方处获知的信息；

iii、             能被证明是在公司告知相关信息之前已获知的信息。

c.           Documents. You agree that, without the express written consent of the Company, you will not remove from the Company’s premises, any notes, formulas, programs, data, records, machines or any other documents or items which in any manner contain or constitute Confidential Information, nor will you make reproductions or copies of same.  In the event you receive any such documents or items by personal delivery from any duly designated or authorized personnel of the Company, you shall be deemed to have received the express written consent of the Company.  In the event that you receive any such documents or items, other than through personal delivery as described in the preceding sentence, you agree to inform the Company promptly of your possession of such documents or items.  You shall promptly return any such documents or items, along with any reproductions or copies to the Company upon the Company’s demand or upon termination of this agreement.

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c、           档案没有公司的明确书面许可，不允许带离或复制公司涉及到保密信息的任何票据、配方、计划、资料、记录、机械装置或任何其他文件。收到公司相关授权人员给予的文件即视为得到明确的书面许可。在得到任何此类文件后，除非如以上所述途径通过个人传送，否则需及时告知公司您对该文件的所有。如公司要求，您需及时归还该文件及其复印件等。

d.           No Disclosure.  You agree that you will hold in trust and confidence all Confidential Information and will not disclose to others, directly or indirectly, any Confidential Information or anything relating to such information without the prior written consent of the Company, except as maybe necessary in the course of his business relationship with the Company.  You further agree that you will not use any Confidential Information without the prior written consent of the Company, except as may be necessary in the course of your business relationship with the Company, and that the provisions of this paragraph (d) shall survive termination of this agreement.

d、              不披露您将对所有的保密信息进行保密，除非是与公司有业务关系且必要的情况，否则在未得到公司事先的书面许可前，不得对任何其他人直接或间接地披露任何保密信息或相关的信息。在未得到公司事先书面许可条件下，不得应用这些保密信息，除非是在您和公司业务往来时有此必要得情况，则该条款在此无效。

8.           Certain Representations.  You represent and agree that you are accepting the Shares for your own account and not with a view to or for sale in connection with any distribution thereof.  You understand that the Shares will be subjected to the restrictions in the Company’s Articles of Incorporation and Bylaws and will not be freely transferable.  You further represent that you are an “accredited” investor as this term is defined in the Securities Act, and that by reason of your business or financial experience, you have the capacity to protect your own interest in connection with receiving the Shares as compensation.  You further represent that you were not solicited by publication of any advertisement in connection with the receipt of the Shares and that you have consulted tax counsel as needed regarding the Shares.

8.           特定声明您将同意以自身账户接受股权，并保证不转手任何分配到的份额。您明了股权将会受限于公司法和公司的规章制度，并不能随意转让。此外，您代表的是证券法案定义的“认可”的投资者，由于您的业务或财务经验，您有能力保护自己有关接受股权形式薪酬相关的利益。您还将表明您未知受到任何有关获得股份相关的公开广告的唆使，且您就股权的问题咨询税务顾问。

9.           Independent Contractor.  In performing your services on the Board, you will be an independent contractor and not an employee of the Company. Except as set forth in this Agreement, you will not be entitled to any additional compensation or participate in any benefit plans of the Company in connection with your services on the Board.  You may not bind the Company or act as a principal or agent thereof.

9.           独立立约人在服务于董事会上，您将会是独立立约人，而非公司的员工。除非如上文另有所述，您将不会被授予额外的补偿或参与任何与您服务于董事会有关的公司福利计划。您不能约束公司或担任主要负责人或代理。

10.           Entire Agreement; Amendment; Waiver.  This Agreement expresses the entire understanding with respect to the subject matter hereof and supersedes and terminates any prior oral or written agreements with respect to the subject matter hereof. Any term of this Agreement may be amended and observance of any term of this Agreement may be waived only with the written consent of the parties hereto.  Waiver of any term or condition of this Agreement by any party shall not be construed as a waiver of any subsequent breach or failure of the same term or condition or waiver of any other term or condition of this Agreement.  The failure of any party at any time to require performance by any other party of any provision of this Agreement shall not affect the right of any such party to require future performance of such provision or any other provision of this Agreement.

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10.           协议的修订与弃用这个协议描述了所有的相关意见，也是对以往任何其它口头或书面协议的终结和替换。经双方书面同意，本协议的任何条款都可能再修正或弃用。一方对本协议任一条款的弃权将不被认定为另一方对同一条款的弃权。无论何时，一方未能要求另一方执行本协议的任意条款，将不影响该方所要求的在未来对本协议该条款的执行。

The Agreement has been executed and delivered by the undersigned and is made effective as of the date set first set forth above.

此协议将自以下签字人署名和设定日期后开始生效执行。

Sincerely,  诚挚，

Grand Farm Inc.

由 By: /s/ Jianshan Yao_____________

AGREED AND ACCEPTED:

同意并接受：

/s/ Feng Liang_____________

Board of Directors Offer Letter

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EX-10.16

Exhibit 10.16

Grain Food Purchase Contract

Contract No. [see attached schedule]

Party A (Purchaser): Fujian Grand Farm Foods Development Co., Ltd.

Party B (Seller): [see attached schedule]

Pursuant to the Contract Law of the People’s Republic of China, the Regulations on Sales and Purchases of Grain, and other relevant laws and regulations, and based on the principles of fairness, justice and good faith, Party A and Party B, through mutual consultation, hereby enter into the following contract for purchase of grain food:

I. Quantity, Specifications, Price and Date of Purchase

Name of Product	Specifications	Quantity	Unit Price	Total Purchase Price	Date of Shipping
[see attached schedule]	Roughness ≥77% Milled rice ≥ 60% Impurities ≤1% Water content ≤14.5%	[see attached schedule]	[see attached schedule]	[see attached schedule]	[see attached schedule]

II. Grain Price

1. The parties shall determine the lowest purchase price at the time of executing this Contract. The agreed lowest purchase price shall not be lower than the lowest purchase price set by the government. If the market price is lower than the agreed lowest purchase price, the purchase shall be based on the agreed lowest price; if the market price is higher than the agreed lowest purchase price, the purchase shall be based on the market price.

2. The total purchase price shall be calculated based on the quantity purchased and the purchase price.

III. Packaging

The products shall be packed in bags. Part B shall pay for the packaging.

IV. Method of Shipping

1.           Time and Quantity

(1)           [see attached schedule]

(2) If the delivery quantity is inconsistent with the quantity set forth in this Agreement, total payment shall be calculated based on the quantity delivered.

2. Shipping

(1) Party B shall ship the product to: No. 2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian City.

(2)           Party B shall pay for the shipping.

V. Inspection upon Receipt

The parties shall work together on the inspection upon Party A’s receipt of the product. Party A shall issue a proof of receipt when the inspection is complete. Any disagreement as to the inspection result shall be resolved based on the result of a quality inspection to be undertaken by the local grain food inspection organization of competent qualification. The responsible party shall be liable for the expense of such inspection.

VI. Payment Method: [see attached schedule]

VII. Breach of Agreement

1. Either party shall be subject to a late fee equal to 1% of the contract price for each day that the party fails to deliver or to take delivery on time.

2. Party A shall be subject to a late fee equal to 1% of the contract price for each day of late payment.

3. Any inconsistency in the grain food shipped by Party B to the specifications set forth in this Agreement shall be resolved by the parties through consultation.

VIII. Dispute Resolution

Any dispute arising from the performance of this contract shall be resolved through consultation or negotiation by the parties, or be submitted to the people’s court.

IX. Miscellaneous

This contract shall become effective upon the parties’ signatures or corporate seals. This contract shall be executed into two duplicate originals with equivalent effect, and each party shall hold one duplicate original.

Party A: Fujian Grand Farm Foods Development Co., Ltd.

Party B: [see attached schedule]

Execution Date: [see attached schedule]

Schedule to Grain Food Purchase Contract

(per Instruction 2 of Item 601 of Regulation S-K)

Contract No.	Party B (Seller)	Name of Product	Quantity (mt)	Unit Price (RMB)	Total Purchase Price (RMB)	Shipping Date	Payment Method	Execution Date
TXLY09412	Jiangxi Longyan Rice Co., Ltd.	rice grain	4,000	2,400	9,600,000	6-30-2009	immediate	4-12-2009
TXLY09623	Jiangxi Longyan Rice Co., Ltd.	rice grain	4,000	2,400	9,600,000	9-30-2009	immediate	6-23-2009
TXLY091010	Jiangxi Longyan Rice Co., Ltd.	rice grain	4,000	2,400	9,600,000	12-31-2009	immediate	10-10-2009
TL091225	Jiangxi Longyan Rice Co., Ltd.	rice grain	4,520	2,650	11,978,000	3-31-2010	after delivery	3-12-2010
TL100312	Jiangxi Longyan Rice Co., Ltd.	Jiangxi rice grain	3,200	2,655	8,496,000	6-30-2010	after delivery	3-12-2010
TL100506	Jiangxi Longyan Rice Co., Ltd.	Jiangxi rice grain	3,020	2,655	8,018,100	6-30-2010	after delivery	5-6-2010
TL110115	Jiangxi Longyan Rice Co., Ltd.	Jiangxi rice grain	550	3,360	1,848,000	2-28-2011	To be negotiated	1-15-2011
FJLH090403	Liaoyang Liaozhong County Yangshigang Town Fengju Cereal Factory	rice grain	6,000	2,220	13,320,000	6-30-2009	immediate	4-3-2009
FJLH090712	Liaoyang Liaozhong County Yangshigang Town Fengju Cereal Factory	rice grain	4,150	2,220	9,213,000	9-30-2009	immediate	7-12-2009
FJLH091015	Liaoyang Liaozhong County Yangshigang Town Fengju Cereal Factory	rice grain	6,730	2,220	14,940,600	12-31-2009	immediate	10-15-2009
TJ090225	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	1,250	1,600	2,000,000	3-31-2009	after delivery	2-25-2009
TJ090428	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	422	1,420	599,240	5-31-2009	after delivery	4-28-2009
TJ090522	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	1,250	1,700	2,125,000	6-30-2009	after delivery	5-22-2009
TJ0909619	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Brown rice grain	1,770	2,300	7,925,400	8-31-2009	after delivery	6-19-2009
		Rice grain	2,190	1,760
TJ090812	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	4,220	1,800	7,596,000	10-31-2009	after delivery	8-12-2009
TJ091019	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	1,450	2,000	2,900,000	12-31-2009	after delivery	10-19-2009
TJ091030	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	1,120	2,146.67	2,404,270	11-30-2009	after delivery	10-30-2009
TJ091118	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	1,100	2,475	2,722,500	12-31-2009	after delivery	11-18-2009
TJ091216	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	1,580	1,960	3,096,800	2-28-2010	Letter of credit	12-16-2009
		Northeastern rice grain	2,000	2,550	5,100,000	1-30-2010
TJ100125	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	1,080	2,074.50	2,240,460	3-20-2010	Letter of credit	1-25-2010
		Northeastern rice grain	4,400	2,475	10,890,000	3-31-2010
TJ100302	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	1,880	2,124.50	3,994,060	4-30-2010	To be negotiated	3-2-2010
TJ100320	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	1,040	2,160	2,246,400	4-30-2010	To be negotiated	3-20-2010
		Northeastern rice grain	4,200	2,485	10,437,000	5-31-2010
TJ100421	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain (early harvest)	760	1,790	1,360,400	5-31-2010	To be negotiated	4-21-2010
		Rice grain (late harvest)	1,200	1,950	2,340,000	5-31-2010
TJ100425	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain (early harvest)	118	1,900	224,200	5-31-2010	To be negotiated	4-25-2010
		Northeastern rice grain	1,000	2,485	2,485,000	5-31-2010
TJ100503	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Northeastern rice	2,120	2,500	5,300,000	6-30-2010	To be negotiated	5-3-2010
TJ100509	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain (early harvest)	2,200	1,898	4,175,600	6-30-2010	To be negotiated	5-9-2010
TJ100603	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain	983	1,974	1,940,442	8-31-2010	After delivery	6-3-2010

TJ100608	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	Rice grain (late harvest)	5,200	1,960	10,192,000	7-31-2010	To be negotiated	6-8-2010
TJ100708	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	rice grain (late harvest)	3,000	1,930	5,790,000	8-30-2010	to be jointly decided	7-8-2010
TJ100809	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	rice grain (late harvest)	3,000	1,930	5,790,000	9-30-2010	to be jointly decided	8-9-2010
TJ10121801	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	rice grain (late harvest)	2,700	2,270	6,129,000	1-31-2011	To be negotiated	12-18-2010
TJ10122701	Fuzhou Hedong Cereal and Oil Trading Co., Ltd.	rice grain (late harvest)	2,700	2,300	6,210,000	1-31-2011	To be negotiated	12-27-2010
TJ11010501	Fuzhou Hedong Cereal and Oil Trading Co., Ltd	rice grain (late harvest)	4,900	2,355	11,539,500	2-28-2011	To be negotiated	1-25-2011
TJ11021501	Fuzhou Hedong Cereal and Oil Trading Co., Ltd	rice grain (late harvest)	1,150	2,360	2,714,000	3-31-2011	To be negotiated	2-25-2011
txnz10101201	Dehui Daoxiangtian Rice Co., Ltd.	northeast rice grain	3,600	2,750	9,900,000	1-31-2011	To be negotiated	10-12-2010
txnz10122401	Dehui Daoxiangtian Rice Co., Ltd.	northeast rice grain	4,000	3,230	12,920,000	2-28-2011	To be negotiated	12-24-2010
txnz11022401	Dehui Daoxiangtian Rice Co., Ltd.	northeast rice grain	3,900	3,000	11,700,000	3-31-2011	To be negotiated	2-24-2011
txnz10121901	Bayan Xinli Cereal and Oil Trading Co., Ltd	northeast rice grain	4,200	3,100	13,020,000	1-31-2011	To be negotiated	12-19-2010
txnz11010201	Bayan Xinli Cereal and Oil Trading Co., Ltd	northeast rice grain	3,300	3,230	10,659,000	2-28-2011	To be negotiated	1-2-2011
txnz11022201	Bayan Xinli Cereal and Oil Trading Co., Ltd	northeast rice grain	2,400	3,010	7,224,000	3-31-2011	To be negotiated	2-22-2011
txnz10100201	Jilin Futian  Cereal and Oil Trading Co., Ltd	northeast rice grain	3,900	2,750	10,725,000	1-31-2011	To be negotiated	10-2-2010
txnz10122201	Jilin Futian  Cereal and Oil Trading Co., Ltd	northeast rice grain	3,700	3,230	11,951,000	2-28-2011	To be negotiated	12-22-2010
txnz11022001	Jilin Futian  Cereal and Oil Trading Co., Ltd	northeast rice grain	3,400	3,000	10,200,000	3-31-2011	To be negotiated	2-20-2011

EX-10.17

Exhibit 10.17

Rice Sales Agreement

Agreement No. [see attached schedule]

This Sales Agreement (hereafter the “Agreement”) is entered into by and between the parties listed below on [see attached schedule]:

Fujian Grand Farm Foods Development Co., Ltd., hereafter referred to as the “Seller”, a limited liability company established under the laws of the People’s Republic of China with registered address at No. 2089 East Hanhua Road, Guohuan Town, Hanjiang District, Putian City; and

AB InBev Brewery Co., Ltd. hereafter referred to as the “Buyer”, a limited liability company established under the laws of the People’s Republic of China with registered address at No. 660 Gongye Road, Hanjiang District, Putian City.

Whereas:

(1) Seller is an enterprise engaged in the production and sale of long-shaped rice (hereafter the “Designated Product”), and warrants that it has obtained all necessary licenses and permits in connection with the production and sale of the Designated Product, including but not limited to government and industry licenses, permits and registrations, and has the full authority to execute this Agreement;

(2) Buyer is an enterprise engaged in the manufacturing and sale of beer that desires to designate Seller as a supplier to supply the Designated Product to Buyer in accordance with this Agreement, and Seller desires to be the designated supplier of the Designated Product for Buyer.

Therefore, Seller and Buyer hereby enter into the following agreement for the Seller to supply the Designated Product to Buyer, on the principles of equality and free will:

1. Product and Product Specification Standards

1.1 The Designated Product for purposes of this Agreement is late long-shaped rice or first crop rice, with harvest year of [see attached schedule], and with state-designated “above grade” quality.

1.2 Seller agrees to sell and Buyer agrees to buy the Designated Product pursuant to the terms and conditions under this Agreement. Seller is hereby appointed as a nonexclusive supplier of Buyer.

1.3 Seller guarantees that the Designated Product shall conform to the specifications and requirements set forth in Attachment 1, Standard, Requirement and Inspection of the Designated Product. Seller shall provide Buyer with the inspection or certificate documentation listed in Exhibit A prior to delivery of the Designated Product.

1.4 Seller shall be responsible for the packaging and shipping of the Designated Product, and warrants that such packaging and shipping shall conform to the standards described in Attachment 2, Packaging and Shipping Standards of the Designated Product.

1.5 Seller warrants to comply with labor law and to not engage in any illegal labor practices, especially the use of child labor.

2. Quantity and Purchase Order

2.1 Buyer and Seller agree that the quantity of Designated Product under this Agreement shall be [see attached schedule] metric tons.

2.2 Seller understands that the quantity of Designated Product set forth in this Agreement is Buyer’s estimate of its requirement based on normal operating conditions, and that such estimate may vary based on changes to Buyer’s production. Actual requirements and delivery dates shall be set in Buyer’s purchase notice. Actual quantity and price shall be determined by quantity properly accepted. Payment calculations shall be based on quantity actually accepted. Changes to Buyer’s estimate shall not impact the purchase orders under this Agreement, and the parties will have duly considered this provision when determining the purchase price.

2.3 Buyer shall indicate the quantity of Designated Product and delivery time in the purchase order, a form of which is in Attachment 3, Purchase Order. Unless the purchase order states otherwise, any matter not addressed in the purchase order shall be governed by this Agreement.

2.4 Buyer’s purchase order shall be placed via facsimile or mail at least two days before the required shipping date. Seller shall supply the Designated Product according to Buyer’s purchase order unless Seller objects within 24 hours upon receipt of the purchase order (the date of receipt shall be determined in accordance of Section 12.4 of this Agreement). Seller shall confirm its receipt of Buyer’s purchase order by transmitting a stamped copy of the purchase order to Buyer, and in addition mailing the original to Buyer. Seller’s failure to object or to transmit or mail the purchase order shall not release Seller from the purchase order.

2.5 Prior to every delivery of the Designated Product, Seller shall provide Buyer with a delivery checklist and, in accordance with Schedule 1, the inspection or certificate documentation for the Designated Product.

3. Delivery and Transfer of Title

3.1 The title of the Designated Product shall be transferred to Buyer after the Designated Product is delivered to Buyer’s location (see attached schedule), and Buyer’s preliminary inspection pursuant to Section 4.2 of this Agreement is complete. Unless Buyer indicates otherwise in the purchase order or other notice in writing, the delivery location shall be Buyer’s rice warehouse.

3.2 Seller shall bear all risks before the title of the Designated Product is transferred to Buyer. After the title is transferred to Buyer, Buyer shall bear all risks.

3.3 Seller warrants that no third party may claim any right to the Designated Product purchased by Buyer, and shall compensate Buyer for any loss caused by such third party claim against Designated Product which title has transferred to Buyer.

3.4 Seller shall deliver the Designated Product according to the time and place set in Buyer’s purchase order, and shall be subject to a daily penalty equal to 5% of the purchase price for the quantity of Designated Product not delivered until actual delivery.  If delivery is late for more than 2 days, Buyer shall have the right to cancel the purchase order and claim damage equal to 3% of the purchase order quantity cancelled. If Buyer’s cancellation due to the foregoing exceeds 30% of the quantity of Designated Product under this Agreement or 3 purchase orders, Buyer may terminate this Agreement or reduce the quantity to be supplied by Seller.

4. Inspection and Acceptance

4.1 Buyer shall conduct a sampling inspection upon receipt of the Designated Product in accordance with the standards and requirements set forth in Schedule 1, and the result of such inspection shall be final.

4.2 Buyer shall conduct a preliminary inspection within 2 days after delivery of the Designated Product to the delivery location designated by Buyer. The preliminary inspection may include an inspection of the packaging and quantity of the Designated Product. If practicable, Buyer may also conduct further inspections afterward. Buyer shall conduct the sampling inspection within 15 days of the delivery of the Designated Product.

4.3 If Buyer discovers during preliminary inspection that the quantity of the Designated Product is less than the purchase order quantity, Buyer shall have the right to require Seller to deliver the deficient quantity immediately or reduce the purchase price. Subject to the foregoing, if the deficient quantity exceeds 10% of the purchase order quantity, Seller shall be subject to a penalty equal to 3% of the purchase price for the deficient quantity. If Buyer discovers during preliminary inspection that the quantity of the Designated Product exceeds the purchase order quantity, Buyer shall have the right to reject the excess quantity or accept same at the same price as when the purchase order was issued.

4.4 If Buyer discovers that the quality, packaging or delivery of the Designated Product does not satisfy the standards set forth in this Agreement (issues relating to quantity to be resolved per Section 4.3 above), Buyer shall have the right to (i) require Seller to deliver the same quantity of conforming Designated Product within a specific period of time, and pay a penalty equal to 5% of the purchase order amount and any other fees incurred by such delay, and Buyer may elect not to return the non-conforming Designated Product; or (ii) accept non-conforming Designated Product with a discount not to exceed 5% of total purchase price under this Agreement. Seller shall also compensate Buyer for any damage resulting from the non-conforming Designated Product.

4.5 Seller shall supply the Designated Product pursuant to the terms and conditions under this Agreement, and if quality or quantity does not conform to Buyer’s requirements, Buyer may, in addition to its other rights provided elsewhere in this Agreement, use the provisions relating to late delivery against Seller.

4.6 The period from the date of delivery to the completion of Buyer’s production shall be deemed the warranty period of the Designated Product, during which time Buyer has the right to monitor and inspect the quality of the Designated Product regardless of the result of the sampling inspection. Seller shall compensate Buyer for damages caused by any quality-related issues discovered during the warranty period.

4.7 Buyer shall notify Seller in writing of any quality-related issue discovered during the warranty period on the same day that such issue is discovered. Seller shall visit Buyer’s production site to inspect and verify such issue within 2 days of receipt of Buyer’s notice. The parties may submit any dispute regarding the quality-related issue to a competent authority to be mutually agreed upon at the cost of the party who raises the dispute. Seller’s failure to timely visit Buyer’s production site or refusal to submit the dispute to a competent authority shall be deemed Seller’s acceptance of Buyer’s claim regarding the quality-related issue.

4.8 Based upon Buyer’s inspection, if the quantity of Designated Product failing to conform to the standards and requirements under this Agreement exceeds 30% of the Designated Product designated under this Agreement or 3 purchase orders, Buyer may terminate this Agreement or reduce the quantity to be supplied by Seller.

5. Price and Payment

5.1 Seller and Buyer agree that the reference price for the Designated Product under this Agreement shall be RMB [see attached schedule] per metric ton. The actual price shall be [see attached schedule].

5.2 The reference price above shall include packaging, delivery, insurance, tax (including value added tax) and all other costs prior to transfer of title. After delivery to warehouse designated by Buyer, Buyer shall be liable for any transportation and handling costs incurred thereafter.

5.3 Buyer shall pay in installments.

5.4 After 60 days from satisfying the conditions below, Buyer shall make payment within 15 days:

a. The Designated Product is properly packaged and timely delivered in accordance with this Agreement and at the date and location in accordance with Buyer’s purchase order;

b. Based on preliminary inspection, the Designated Product as delivered conforms to all standards and requirements required under this Agreement;

c. Seller has provided Buyer with the invoice for the 13% value added tax; and

d. Seller has provided Buyer with all documentation described in Attachment 1.

5.5 Buyer is subject to a daily late fee equivalent to 1.5% of the amount outstanding calculated from the 16th day after the due date.

5.6 Security Deposit. [see attached schedule]

6. Intellectual Property

6.1 Seller warrants that the Designated Product produced, packaged, stored, delivered and sold under this Agreement shall be in compliance with all applicable international and domestic laws and regulations. The Designated Product shall not infringe on any third party’s rights, including but not limited to intellectual property rights. If the Designated Product infringes on any third party’s rights and as a result causes Buyer damage, Seller shall be liable to compensate Buyer for such damage.

6.2 All designs, drawings and trademarks provided by Buyer relating to the Designated Products and all improvements thereon are the intellectual property rights of Buyer (including copyrights, trademark rights, and trademark and patent application rights). Seller shall not use or permit others to use such intellectual property in any way after this Agreement is terminated.

6.3 Unless agreed to by the other party, no party shall use the name, brand name or trademark of the other party (including simplification or imitation  thereof) on any product, advertisement or in marketing activities.

7. Confidentiality

7.1 Both parties to this Agreement agree to deem the following information as trade secret: any information disclosed by either party pursuant to this Agreement regarding products, brand names, services, suppliers, customers, or management, or any other information that is not known by the general public or outsiders, in wring or not in writing, memorialized in word, graphic, or electronic format (hereafter “Trade Secret”).

7.2 Both parties agree and warrant:

(1) To use the Trade Secret disclosed by either party solely for the purpose of performing this Agreement;

(2) To not duplicate, circulate or disclose by any means, in part or in whole, the other party’s Trade Secret without the prior written consent of the other party;

(3) To take all possible and necessary measures to ensure that all personnel or subcontractor with access to the Trade Secret shall comply with this confidentiality provision, including executing confidentiality agreement with such parties containing similar confidentiality provision, provided that the party receiving the Trade Secret shall assume full liability for any breach of this provision ; and

(4) to take all necessary measures to protect the confidentiality of the Trade Secret.

7.3 Both parties agree that Trade Secret shall not include:

(1) Any information that is already in the public domain at the time of disclosure by either party, or that is later disclosed to the public not through the fault of the other party;

(2) Any information known to the other party at the time either party is disclosing the information;

(3) Any information received from a third party that is not obligated to keep such information confidential; and

(4) Any information required to be disclosed by court order or other legally enforceable orders.

7.4 Upon the termination of this Agreement for any reason, either party shall keep confidential the Trade Secret of the other party as long as such information is not in the public domain or is not known by the general public or within the industry.

7.5 Upon the termination of this Agreement for any reason, regardless of whether or not all payment has been settled between the parties, either party shall return all Trade Secret of the other party and shall delete all records of such Trade Secret from its computers. No duplicates of the Trade Secret shall be retained.

8. Insurance

During the term of this Agreement, Seller shall pay all insurances relating to the Designated Product, including product liability insurance, employer’s liability insurance, property insurance, etc.

9. Term and Termination

9.1 This Agreement shall become effective upon execution by both parties. The term of the Agreement shall be [see attached schedule]. If the quantity under this Agreement is met before the Agreement termination date, the term of the Agreement shall end on the day that such quantity is met; otherwise, the Agreement shall terminate on the Agreement termination date.

9.2 Unless agreed otherwise, Buyer shall have the right to terminate this Agreement if Seller breaches this Agreement and fails to correct same within 15 days after Buyer’s written notice of such breach.

9.3 Either party may terminate this Agreement immediately upon giving a notice in writing to the other party if the other party’s business is suspended, dissolved, or rendered into proceedings of bankruptcy or receivership.

9.4 If there is a material change of Seller including but not limited to changes of shareholding, nominating rights of the legal representative or nominating rights of more than half of Seller’s directors, Seller shall notify Buyer within 15 days after such change. Buyer shall have the right to elect to terminate this Agreement within 7 days upon receipt of Seller’s notice. If Buyer elects to terminate this Agreement, Buyer shall have no liability with respect to such termination.

9.5 Other than due to force majeure or as provided under this Agreement, neither party may terminate this Agreement without the other party’s prior consent. Otherwise, the non-terminating party shall have the right to seek damage from the terminating party for breach of agreement and for any loss caused by the termination.

10. Breach of Agreement

10.1 Any party who fails to perform its obligations under this Agreement shall be subject to a penalty equal to 20% of the total purchase price under this Agreement. Any party who fails to perform its obligations with respect to a purchase order shall be subject to a penalty equal to 20% of the purchase order amount. If the non-breaching party requires the breaching party to continue its performance, the breaching party shall perform accordingly and pay the above-described penalty to the non-breaching party.

10.2 A breaching party shall be liable for its breach. The non-breaching party may elect to claim damage from the breaching party and relieve the breaching party from further obligations; or require the breaching party to fulfill its obligations and compensate the non-breaching party for its loss.

10.3 Seller shall be fully liable for damages caused to a third party due to the defect of the Designated Product.

10.4 A party shall not be liable for its failure to perform due to force majeure. However, the party affected by force majeure shall provide the other party with proof of such within 15 days of its occurrence or conclusion. If the force majeure continues beyond 30 consecutive days, if the performance of this Agreement cannot be resume within 30 days after the force majeure ends, then either party has the right to terminate the Agreement without any liability for breach.

11. Dispute Resolution

11.1 Any dispute arising from the performance of this Agreement shall be resolved through consultation between the parties. If no resolution can be reached within 30 days after the dispute is first raised in writing by any party, either party may submit such dispute to a court of law for resolution.

11.2 Buyer and Seller agree that any lawsuit relating to this Agreement shall be brought before the court of law at Buyer’s location.

12. Miscellaneous

12.1 The attachments shall be deemed a part of this Agreement and shall have the same legal effect as this Agreement.

12.2 No party may transfer or assign its rights or duties under this Agreement to a third party without the prior written consent of the other party.

12.3 This Agreement, together with the attachments, shall constitute the agreements of the parties regarding the matters herein and shall supersede all prior oral or written agreements entered into by and between the parties, such other agreements having no further legal effect.

12.4 No amendment to this Agreement shall be effective unless made in a supplemental written agreement signed by both parties.

12.5 The titles of the Agreement and the sections therein are to facilitate their reading, and shall have no effect upon the provisions of this Agreement or the interpretation thereof.

12.6 This Agreement shall be executed into two duplicate originals with equal legal effect. Each party shall hold one duplicate original.

This Agreement is executed by the representatives of the parties below as of the date first written above.

Seller:                      Fujian Grand Farm Foods Development Co., Ltd. [seal]

Buyer:                      AB InBev Brewery Co., Ltd. [seal]

Schedule to Grain Food Purchase Contract

(per Instruction 2 of Item 601 of Regulation S-K)

Agreement No.	Agreement Date	Harvest Year	Quantity of Rice (mt)	Delivery Location	Reference Price (RMB)	Actual Price (RMB)	Security Deposit	Term
TX090306	3-6-2009	2008	8,000	No. 666 Gongye Road, Hanjian District	2,910	Based on market condition	Not applicable	5-1-2009 to 12-31-2009
TX1011	12-1-2009	2009	24,000	Putian or Putian No. 2 Warehouse	3,448 (plus RMB 10 per mt for delivery to Putian No. 2 Warehouse)	Except for major event, market condition will not affect this Agreement	Seller has remitted RMB 200,000 as good faith deposit during bidding for this Agreement, which shall now be deemed a security deposit against breach, and shall be returned to Seller upon full performance of this Agreement	1-1-2010 to 12-31-2010
RM-RIC-1012-005	12-2-2010	2010	6500	No. 666 Gongye Road, Hanjian District	3,680	No change during the contract term	Not applicable	2-2-2011 to 3-31-2011

EX-10.18

Exhibit 10.18

Grain Food Purchasing Agency Agreement

Agreement No. [see attached schedule]

Party A: Fujian Grand Farm Foods Development Co., Ltd.

Party B: Panjin Jiahong Industrial Co., Ltd.

In order to utilize Party B’s scale of grain purchasing to minimize cost and increase economic returns, Party A and Party B, after due consultation, hereby enter into the following agreement to facilitate the meeting of their mutual obligations with respect to grain food purchasing by agency:

I. Agreement

1. Party A hereby appoints Party B as purchasing agent for the grain harvested in [see attached schedule] in Panjin Region of Liaoning Province.

2. Party B shall purchase grain with the following specifications: roughness ≥77%, milling ≥60%, impurities ≤1%, water content ≤14.5%.

2. Party B warrants that the price of the grain purchased as purchasing agent of Party A shall not be lower than the lowest purchasing price set by the State. Party A has the right to monitor the purchase.

3. Party B shall act as the purchasing agent of Party A from [see attached schedule] to [see attached schedule].

4. Party B shall purchase grain of no less than [see attached schedule] metric tons, and no more than [see attached schedule] metric tons.

5. Fee as purchasing agent shall be RMB 20 per metric ton

6. Party A’s purchase price shall be based on actual quantity of grain purchased and the purchase price that Party B paid.

II. Rights and Duties of the Parties.

1. Party A’s Rights and Obligations

a. Party A shall accept grain that satisfies inspection and pay the purchase price as required under this Agreement.

b. Party A shall pay Party B’s agency fee as required under this Agreement.

c. Party A shall not engage in fraud or deceitful act.

d. Party A has the right to monitor and confirm Party B’s purchase price, and has the right to require Party B to adjust any price deemed inappropriate. In the event that the parties cannot resolve any dispute regarding purchase price, Party A has the right to change to another purchasing agent and seek damages from Party B.

2. Party B’s Rights and Obligations

a. Party B hereby accepts Party A’s request and agrees to act as Party A’s purchasing agent.

b. Party B is obligated to permit Party A’s inspection of the grain purchased.

c. Party B is responsible for any procedure required for the inspection, storage and shipping of the grain.

d. Party B is responsible for any dispute or claim arising from the purchasing and shipping of the grain.

III. To ensure the safety of Party A’s funds, Party B hereby appoints Zhiqi Yu as its agent. All of Party A’s orders and funds shall be transacted through Mr. Yu and his personal bank account.

IV. Breach of Agreement

1. Party A shall compensate Party B for its loss resulting from late payment of purchase price or fee.

2. Party B shall compensate Party A for its loss resulting from quality issues relating to the grain that are caused by Party B.

V. The parties may enter into a separate agreement for purchase in large quantity or for specialty grain, based on the principles of this agreement.

Party A: Fujian Grand Farm Foods Development Co., Ltd. [seal]

Party B: Panjin Jiahong Industrial Co., Ltd. [seal]

Execution Date: [see attached schedule]

Place of Execution: Panjin Liaoning

Schedule to Grain Food Purchasing Agency Agreement

(per Instruction 2 of Item 601 of Regulation S-K)

Agreement No.	Harvest Year	Term of Agency Appointment	Quantity of Rice (mt)	Agreement Execution Date
TXJH091012	2009	1-1-2010 to 12-31-2010	no less than 10,000 mt, and no more than 15,000 mt	10-12-2009
TXJH10122301	2010	1-1-2011 to 12-31-2011	No less than 20,000 mt, and no more than 30,000 mt	12-23-2010

EX-10.19

Exhibit 10.19

Facility Lease Agreement

Lessor (hereafter referred to as “Party A”): Fujian JiaJia Food Co., Ltd.

Lessee (hereafter referred to as “Party B”): Fujian Grand Farm Foods Development Co., Ltd.

Pursuant to the relevant regulations of the State, Party A and Party B hereby enter into the following agreement regarding the lease of a manufacturing facility legally owned by Party A upon the principles of free will, equality and mutual benefit:

I. Party A’s Facility: The facility that Party A is leasing to Party B is located inGaoxin Development District of Putian City, and is 11,611 square meters in size. The facility is a standard industrial facility with iron framing, consisting of 5,620 square meters of storage space (storage1 and storage 2), and 5,991 square meters of manufacturing space (building 2, building 3, building 4 and building 5).

II. Lease Payment Commencement Date and Lease Term:

1. The facility shall be made available for renovation and equipment installation for 18 months, from July 1, 2009 to December 31, 2010, during which time the facility will be rent-free.

2. The lease term shall be 10 years, from January 1, 2011 to December 31, 2020.

3. Party A has the right to reoccupy, and Party B has the obligation to vacate, the facility upon the expiration of the lease. Party B may submit a written request for renewal to Party A3 months prior to thelease expiration date, and upon Party A’s agreement, renew the lease agreement.

III. Payment of Rents and Deposit:

1. Party A and Party B jointly agree that the rental amount for the first year of the lease term shall be RMB 500,000.

2. Starting from the second year of the lease term, the annual rental amount shall increase 3% to 5% from the previous year.

3. Party B shall pay a deposit of 30% of the annual rental amount to Party A by January 1, 2011. Party B shall pay rent on a quarterly basis commencing January 1, 2011, payable 5 days before the first month of the quarter.

IV. Other Fees: During the lease term, Party B shall pay for water, electricity, gas, telephone and other utilities arising from the use of the facility, payable within 3 days of Party B’s receipt of invoices or bills.

V. Maintenance and Repair:

1. During the lease term, Party B shall notify Party A to repair any damage to or breakdown of the facility and related fixtures. Party A shall commence repair within 3 days after receiving Party B’s notice. Otherwise, Party B may repair at Party A’s costs.

2. During the lease term, Party B agrees to use the facility and related fixtures properly and with reasonable care. If a damage or breakdown is caused by Party B’s improper use, Party B shall be responsible for the repairs. If Party B refuses to repair, Party A may repair at Party B’s costs.

3. During the lease term, Party Apromises to maintain the facility and all related fixtures, in normal working order and safe condition. Party A may enter and inspect the facility upon 3-day advance notice to Party B. During the inspection, Party B shall cooperate with Party A, and Party A shall minimize disruption to Party B’s use of the facility.

VI. Party B shall not make any alterations or install additional fixtures to the facility without Party A’s prior written consent and the approval of responsible government authority.

VII. Sublease: During the lease term, Party B shall not sublease the facility without Party A’s prior written consent. Otherwise, Party A is not obligated to refund any rental paymentor deposit.

VIII. Upon the expiration of the lease term, Party B shall return the facility to Party A with all fixtures in normal working condition.

IX. Other Agreements during the Lease Term:

1. During the lease term, the parties shall abide by the laws and regulations of the State and shall not use the lease to engage in illegal activities.

2. During the lease term, Party A has the right to oversee and assist Party B to properly prepare for fire prevention, sanitation and safety.

3. During the lease term, if this lease agreement is rendered impossible to perform by reasons that are beyond the parties’ control or due to eminent domain, the parties shall not be liable to each other.

4. During the lease term, Party B may renovate the facilityat its own discretion and costs, provided that Party B shall not alter the structure of the facility. Upon the expiration of the lease term, if Party B does not make claim for such renovation, Party A shall not be obligated for any reimbursement.

IX. During the lease term, Party A shall provide Party B with door intercoms at no charge. Party B shall be responsible for the fees of all other intercoms.

X. During the lease term, Party B shall pay rent and other fees promptly. Party A has the right to charge a 5% penalty or terminate the lease if payment is overdue for one month.

XI. Upon the expiration of the lease, Party B shall have priority to lease the facility if Party A desires to continue leasing the facility. If the facility is not available for lease, Party B shall vacate the facilityand shall be liable for any costs or damages resulting from its failure to vacate.

XII. Miscellaneous

1. During the lease term, if either party terminates the lease before the expiration date, the terminating party shall pay the other party compensation equal to three months of rent.

2. During the lease term, if an issue concerning the ownership of the facility disrupts Party B’s normal operations to Party B’s detriments, Party A shall be liable for resulting damages.

3. Party A may prepare and process business license and other applications on behalf of Party B, with all related costs to be paid by Party B.

4. After the lease is executed, if any party changes its corporate name, the parties may note the change of corporate name on the lease agreement with their signatures and corporate seals, and the terms and conditions of the lease shall remain unchanged, to continue in effect until the expiration of the lease term.

XIII. Any unsettled matters relating to the lease shall be resolved upon mutual consultation by the parties.

XIV. This agreement shall be executed in four original duplicates, with each party to hold two original duplicates. This agreement shall become effective upon the parties’ signatures and corporate seals.

Lessor: Fujian JiaJia Food Co., Ltd. [seal]

Lessee: Fujian Grand Farm Foods Development Co., Ltd. [seal]

Execution Date: June 15, 2009

EX-10.20

Exhibit 10.20

Facility Lease Supplemental Agreement

Lessor (hereafter referred to as “Party A”): Fujian JiaJia Food Co., Ltd.

Lessee (hereafter referred to as “Party B”): Fujian Grand Farm Foods Development Co., Ltd.

Whereas, pursuant to the Facility Lease Agreement entered into by Party A and Party B on June 15, 2009 (hereinafter the “Agreement”), Party B has completed renovation and equipment installation within the timeframe set forth in the Agreement, and in order to sufficiently protect the rights and benefits of Party B, the parties, upon mutual consultation, hereby supplement the Agreement as follows:

I. Section II (2) of the Agreement provides that “The lease term shall be 10 years, from January 1, 2011 to December 31, 2010.” It is hereby amended as “The lease term shall be 18 years, from January 1, 2011 to December 31, 2028.”

II. Section XII (1) of the Agreement provides that “During the lease term, if either party terminates the lease before the expiration date, the terminating party shall pay the other party compensation equal to three months of rent.” It is hereby amended as “During the lease term, if Party A terminates the lease before the expiration date, Party A shall pay Party B compensation of RMB 20 million. During the lease term, if Party B terminates the lease before the expiration date, Party B shall pay Party A compensation equal to three months of rent.”

III. All other terms and conditions of the Agreement shall remain unchanged.

Lessor: Fujian JiaJia Food Co., Ltd. [seal]

Lessee: Fujian Grand Farm Foods Development Co., Ltd. [seal]

December 8, 2010

EX-10.21

Exhibit 10.21

AGREEMENT

THIS AGREEMENT (the “Agreement”) is made and entered into among the following parties as of December 30, 2010 in Fujian, the People’s Republic of China (“China” or the “PRC”):

Party A:	Putian Asia Success Cereals & Oils Technical Service Co., Ltd.
Address:	No. 999, Houguo Street, Sanjiangkou Town, Hanjiang District, Putian City
Party B:	Fujian Grand Farm Foods Development Co., Ltd.
Address:	No. 2089, Hanhua East Road, Guohuan Town, Hanjiang District, Putian City
Party C:	Yao Jianshan
ID No.:	350303690720035
Party D:	Yao Jianxin
ID No.:	350303197201280334

WHEREAS:

1. Party A is a wholly foreign-owned enterprise duly incorporated and validly existing under the laws of the PRC;

2. Party B is a limited liability company duly incorporated and validly existing under the laws of the PRC;

3. Party C and Party D are shareholders of Party B who collectively own 100% of the equity interests of Party B (the “Equity Interests”);

4. Party A has established a business relationship with Party B pursuant to a certain Exclusive Technical Consulting Service Agreement with Party B dated as of September 25, 2010 (the “Service Agreement”), and in connection therewith, has also entered into a certain Operating Agreement (the “Operating Agreement”), a certain Equity Interest Pledge Agreement (the “Pledge Agreement”) and a certain Exclusive Equity Interest Purchase Agreement (the “Purchase Agreement”) with Party B, Party C and Party D dated as of the same date, and Party C and Party D have each also executed a certain Power of Attorney in favor of Party A dated as of the same date (collectively the “VIE Agreements”);

5. Pursuant to the Service Agreement, Party B shall pay 85% of its annual net profit to Party A as a consulting fee, and pursuant to the Pledge Agreement, Party A shall be entitled to 15% of Party B’s annual net profit;

6. Pursuant to the Operating Agreement, Party B shall not conduct any transaction which may materially affect its assets, obligations, rights or operations without Party A’s prior written consent, and pursuant to the Purchase Agreement, Party B shall not allot any dividend to any shareholder without the prior written consent of Party A;

7. Pursuant to the Power of Attorney, Party C and Party D have authorized Party A to exercise all of their shareholder’s rights associated with the Equity Interests, and they may exercise such rights as entrusted to Party A only upon Party A’s consent; and

8. Party C and Party D desire to declare, and Party B desires to distribute, a portion of Party B’s unappropriated earnings from its establishment to 2009 as dividend, and Party A agrees to such declaration and distribution subject to the terms and conditions of this Agreement as set forth below.

NOW THEREFORE, through mutual discussion, all parties to this Agreement have agreed as follows:

1. Party A hereby consents and authorizes, and Party B, Party C and Party D hereby jointly agree that, Party C and Party D are entitled to declare 52% of Party B’s unappropriated earnings from Party B’s establishment to 2009 in the aggregate amount of RMB 66,200,000 (USD$10,000,000) as dividend (the “Dividend”), and further agree that Party B shall distribute the Dividend to Party C and Party D pro rata to their respective ownership percentage of the Equity Interests as follows:

Party C	99.75%	66,034,500 RMB (as 9,975000 USD)
Party D	0.25%	165,500 RMB (as 25,000 USD)

2. Party A hereby consents and authorizes, and Party B, Party C and Party D hereby jointly agree that, Party C and Party D are entitled to exercise their respective shareholder’s rights in connection with the declaration and distribution of the Dividend by Party B, and further agree that Party C and Party D shall execute all shareholder resolutions in connection therewith as may be required by the laws and regulations of the PRC as well as Party B’s articles of association.

3. Except as otherwise contemplated by this Agreement, Party C and Party D shall not declare any other of Party B’s unappropriated earnings as dividend, and Party B shall not distribute same to Party C and/or Party D, including the remaining 48% of unappropriated earnings of Party B from its establishment to 2009 in the aggregate amount of RMB 61,049,051 (USD$8,144,938), as well as Party B’s unappropriated earnings for 2010 and thereafter.

4. Party A hereby agrees that its consents and authorizations provided herein shall constitute such consents and authorizations as required under the VIE Agreements, and hereby waives all breach of the terms of the VIE Agreements by Party B, Party C and Party D in connection with or arising from the Dividend, if any.

5. This Agreement has been passed through the internal approval of Party A and Party B as required by the laws and regulations of the PRC as well as their respective articles of association.

6. Upon its execution, this Agreement shall come into effect as of the date first set forth above, and shall remain in full force and effect so long as the Service Agreement and the Pledge Agreement remain in effect.

7. Any amendment and supplement of this Agreement shall be made in writing and duly executed by all parties, which shall be deemed a part of, and shall have the same legal effect as, this Agreement.

8. This Agreement shall be governed by and interpreted according to the laws of the PRC.

9. The parties shall strive to settle any dispute arising from the interpretation or performance of this Agreement through friendly consultation. In case no settlement can be reached through consultation, each party can submit such matter to China International Economic and Trade Arbitration Commission (“CIETAC”) for arbitration in accordance with the then effective rules of CIETAC. The arbitration proceedings shall take place in Beijing and shall be conducted in Chinese. The arbitration award shall be final and conclusive and binding upon all the parties.

10. Each party shall bear its own tax, costs and expenses in connection with this Agreement and the transactions contemplated herein.

[Reminder of this page intentionally left blank]

Party A: Putian Asia Success Cereals & Oils Technical Service Co., Ltd

Authorized Representative: Yao Jianshan

Seal: [seal]

Party B: Fujian Grand Farm Foods Development Co., Ltd.

Authorized Representative: Yao Jianshan

Seal: [seal]

Party C: Yao Jianshan

Signature: /s/ Yao Jianshan

Party D: Yao Jianxin

Signature: /s/ Yao Jianxin

EX-21.1

Exhibit 21.1

Subsidiaries of the Registrant

(1) Asia Success Holdings Limited, a Hong Kong company, is wholly owned by the Registrant.

(2) Putian Asia Success Cereals and Oils Technical Service Co., Limited, a company in the People’s Republic of China, is wholly owned by Asia Success Holdings Limited.

(3) Fujian Grand Farm Foods Development Co., Ltd., a company in the People’s Republic of China, is deemed a variable interest entity of the Registrant pursuant to a series of contractual arrangements entered into with Putian Asia Success Cereals and Oils Technical Service Co., Limited

EX-23.1

EXHIBIT 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the use in the Prospectus constituting a part of this Registration Statement of our reports dated April 7, 2011, relating to the consolidated financial statements of Grand Farm Inc., its subsidiaries and variable interest entity, as of December 31, 2009 and 2010 and for each of the three years in the period ended December 31, 2010, which is contained in that Prospectus.

We also consent to the reference to us under the caption “Experts” in the Prospectus.

/s/ BDO Limited

Hong Kong, May 12, 2011

EX-23.4

Exhibit 23.4

May 12, 2011

Grand Farm Inc.

No.2089 East Hanhua Road

Guohuan Town, Hanjiang District

Putian, Fujian Province, China 351111

Ladies and Gentlemen:

Pursuant to Rule 438 promulgated under the Securities Act of 1933, as amended, I hereby consent to the references of my name in the Registration Statement on Form F-1 (the “Registration Statement”) of Grand Farm Inc. (the “Company”), and any amendments thereto, which indicate that I have accepted the appointment to become a director of the Company. I further agree that immediately upon the completion of the initial public offering of the Company’s ordinary shares in the form of American depositary shares pursuant to the Registration Statement, I will serve as a member of the board of directors of the Company.

Sincerely yours,

/s/ Kam Por Cheng 

Name: Kam Por Cheng