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FORM 8-K Exhibit 10.2
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CONTRACT TO DESIGN AND
CONSTRUCT TRT SYTEM
This Contract to Design and
Construct TRT System (`Contract") is entered on
this 26th Day of September, 2006 by and between
Xingtai Iron and Steel Co., Ltd ("Xingtai"), locate at No.262 Steel South
Road, Xingtai City, Hebei Province, People's
Republic of China, Postal Code:
054027
and
Xi'an Yingfeng
Science&Technology Co.,Ltd ("Yingfeng"), located at Chang'an
International Square, Suite B, Room 909,
No. 88, Nan-Guan-Zheng Street, Xi'an
City, Shaanxi Province, People's Republic of China, Postal Code: 710068
(Xingtai and Yingfeng shall individually be referred to as a
"Party", and
collectively as the "Parties".)
In accordance with the Contract Law of the People's Republic of China and
other pertinent laws and
regulations of China, both Parties
enter into the
following sections and terms on the principles of equality and mutual benefit
and through friendly negotiations:
Section 1. TRT Project
----------------------
This is a Blast Furnace Top Gas
Recovery Turbine Unit Project
(hereinafter
referred to as "TRT Project") and will be
constructed based on No.4 and
No.5
blast furnace owned by Xingtai.
Section 2. Cooperation Method
-----------------------------
(1) The fund for designing and constructing the TRT Project will be raised
by Yingfeng. A third party, China Foreign Economy and Trade Trust &
Investment
Co.,Ltd ("FOTIC"), which shall be capable of fulfilling the
qualifications for
capital lease, will be invited by Yingfeng.
FOTIC will provide the capital
leasing service for TRT
Project. Xingtai and FOTIC will enter a Contract of
Capital Lease.
(2) Yingfeng agrees to make payments of deposit, commission
charges and
other fees associated with the financial affairs of TRT Project. Xingtai agrees
to pay the monthly rental to
Yingfeng and FOTIC after
the TRT Project is
completely constructed and relegated by Yingfeng.
Section 3. Technology Requirements
----------------------------------
Yingfeng designs the project according to the technology
documents and
plans ("Plan") attached to this Contract signed by Xingtai and
Yingfeng and such
design should be accepted by Xingtai.
Yingfeng constructs the project according
to the above-mentioned Plan. The
completed project should comply with such plan
and other industrial standards
and fulfill the requirement of connecting to
public electrical wire in XingTai. The appendices to this Contract,
such as
construction technology agreement
entered in accordance with the Plan, are
integral parts of this Contract and equally effective.
Section 4. Necessary Condition
------------------------------
Xingtai shall:
(1)
Apply for and
acquire all the
necessary license, approval
and
certificates for land use and
construction of the TRT project.
<PAGE>
(2) Ensure
that the pipeline of
Blast Furnace
Gasi(cent)wateri(cent)nitrogen and eletricity
will be linked to construction
site of the TRT Project.
Section 5. Fund and Payment
---------------------------
(1) The total amount of fund for the TRT
Project is Thirty Million RMB Yuan
((pound)*30,000,000), which
include the cost
of design,
constructioni(cent)equipments and
financial affairs.
(2) Project rental:
Base on the investment forecast,
Xingtai will make
monthly rental payment of Nine
Hundred Thousand RMB Yuan
((pound)*900,000)
to
Yingfeng and FOTIC for total 60
months. As the actual investment
is
confirmed by
both Parties, monthly
rental payment will
be adjusted
accordingly. The formula of adjustment is: Monthly Rental
Payment(RMB Yuan
in 10 Thousands)=(pound)*900,000 x
Actual Investment (RMB
Yuan in 10
Thousands)/(pound)*30,000,000.
(3) Project fund payment: Yingfeng
will relegate the TRT project to Xingtai
when it is completed
and under working order.






