AGREEMENT

　　Date:

　　This agreement is made by and entered into between China Jiangsu Medicines & Health Products Import & Export (Group) Corporation (hereinafter referred to as Party A) and Medpharm Inc. (hereinafter referred to as Party B), whereby Party A agrees to Party B to act as its exlusive distributor for the under-mentioned commodities in the designated territory on the terms conditions set forth below:

　　(1) Name of Commodity: All surgical dressings including gauze, gauze sponges, gauze laps, absorbent cotton wool, and all other hospital disposal items.

　　(2) Territory: The territory covered by this Agreement is confined to Caribbean Sea countries, Venezuela and Mexico except Trinidad & Honduras countries. Party B shall exert its best efforts to push the sale of the specified commodities so as to secure the maximum volume of sales and shall not handle any of the specified commodities of any other company in the said territory. Party A agrees not to sell any of the specified commodities to other firms or importers in the said territory and shall refer to Party B all inquiries received from clients in the territory.

　　(3) Price and Quantity: The price and quantity for the goods of each transaction are to be fixed through negotiations by both parties. Each transaction is subject to Party A's confirmation.

　　(4) Minimum Turnover: Pary B undertakes to place with Party A orders amounting to 1.5 million U. S. dollars during the term of this Agreement. The amount of orders placed in the first six months shall not be less than $ 375, 000,00.

　　(5) Payment: Payment is to be made by confirmed, irrevocable letter of credit, without recourse,available by 60 days sight draft upon presentation of shipping documents to the negotiating bank in Nanjing. Party B shall pay party A 2% of invoice value as interest charges for the 60 days delayed payment. The letter of credit for each order shall reach Pary A 45 days before the date of shipment.

　　(6) Commission: No commission shall be paid for direct transaction between Party A and Party B under this Agreement. Party A will sell to any third party only on orders previously quoted and approved by Party B. If and when these orders are transacted, Party A shall pay Party B the differential between the current CIF price and the price at which the goods are sold to the third party.

　　(7) Validity of the Agreement: This agreement is to remain valid for a period of 18 months commencing from               and terminating on                . If either party considers it necessary to extend the Agreement, the proposing party may take the initiative to conduct negotiation with other party one month prior to its expiration.

　　(8) In the event of a breach of any of the provisions of this Agreement by one party, the other party may at its option cancel this Agreement by one party, the other party may at its option cancel this Agreement forthwith by giving notice in writing to the defaulting party.

　　Party A　　　　　　　　　　　　　　　Party B

　　China Jiangsu Medicines & Health Products　Medpharm Inc.

　　Import & Export (Group) Corporatoin

　　SIGNATURE                    　　　　　 SIGNATURE