Clarification on Rumor

The recent increase in the closing price of the company's stock over three consecutive trading sessions on 20, 21 and 22 Oct 2008 represents a deviation of 20%, thus constituting an unusual price movement.

In regards to the report published in the Guangzhou Daily on 22 Oct 2008, the company would like to clarify the following:
1. The company, its effective controller and controlling shareholder have never negotiated with Foshan Haday Flavoring & Food Co., Ltd. over a back-door listing and restructuring. The company has never Given up the rights of listing.
2. Cai Dejian, the office director, did not conduct an interview with the Guangzhou Daily; and therefore, the quote as it appears is the speculation of the journalist.
3. To date, Foshan Fushuo Hongxin Investment Co., Ltd. is the second-largest shareholder of the company with 94,982,700 shares, equal to a 15.51% stake. Since its holding of restricted shares became tradable, Foshan Fushuo has sold 51,284,610 shares of the company, equal to a 8.37% stake, of which 3.42% stake has been sold since the beginning of 2008.
In addition, Fuoshan Fushuo reduced its equity in the company.

The board of directors, the controlling shareholder and the effective controller of the company have confirmed that there are no significant undisclosed issues outstanding, nor are there any remaining undisclosed issues, including plans, negotiations, intentions, and agreements that might materially impact the company's stock price foreseeable within the next three months.

The China Securities Journal, the Securities Times and the China Info website (www.cninfo.com.cn) are the company's designated media for information disclosure. Investors are advised to exercise caution when dealing in the company's shares.

Board of Directors
24 Oct 2008


Source: Securities Times

Date: 27 Oct 2008

CN01/FL/JL/NK/KM