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On June 1, 2010, we entered into an agreement with Jiangxi Province People’s Government of Fenyi County in Xinyu City, Jiangxi Province, to develop a brand new tourism project to be named "The City of Caves" based on the largest and most characteristic karst land underground caverns in China, for a management period of 40 years commencing from 2010.

Fenyi County is located in the mid-west of Xinyu City, 30 kilometers from downtown Xinyu. Xinyu is believed to have highest industrialization among all cities of Jiangxi Province, featuring two key industries, steel and photovoltaic. Management estimates that a three-hour driving circle will cover a population of approximately 50 million in 11 cities including the three provincial capital cities of Nanchang, Changsha and Wuhan. Several rail lines and highways across Xinyu make transportation convenient.

The first phase, mainly composed of Altair Cave and Vega Cave, is scheduled to start trial operation in the end of 2012. The second phase will include the Hanmao Cave Cluster and the third phase will include the tourism resources of Dagang Mountain. The City of Caves will attract tourists who are visiting the several nearby world-class tourism destinations, including Sanqing Mountain, Longhu Mountain, Jinggang Mountain, and Lu Mountain, all of which are famous and popular attractions in China. In addition, the Project is only a one-hour drive from China Yida's Yang-sheng Paradise, which means the Company can integrate the resources of the two projects and launch a very cost-effective and powerful integrated marketing campaign. The Project will be designed to provide comprehensive cultural background and will feature a high level of interaction between natural views and entertainment experiences, as compared to simple sightseeing of peer caves. The revenues from City of Caves will include entrance fees, hotel, entertainment services and tourism/commercial real estate.


 
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