PNCOMM PTY LTD

108/223 North terrace adelaide sa 5000

C ONTRACT CODE: OAB/PP-D/300/11/COF /11

BUYER CODE:

SELLER CODE: BH026/T2/003/11

SALES & PURCHASE AGREEMENT

USED RAIL SCRAP R50&R65

THIS AGREEMENT IS MADE ON 20^TH Mar. 2012

HEREINAFTER TOGETHER SHALL BE REFERRED TO AS PARTIES OR PARTY.

This Agreement made on this 20^TH Mar, 2012.

Between:-

HEREINAFTER REFERRED TO AS THE SELLER:-

COMPANY NAME: PNCOMM PTY LTD

ADDRESS: 108/223 NORTH TERRACE ADELAIDE SA 5000

TELEPHONE:

Fax: +

E – MAIL ADDRESS:

REPRESENTED BY: MR,HEE IN,YEUN

TITLE : PRESIDENT

AND

HEREINAFTER REFERRED TO AS THE BUYER:-

COMPANY NAME:

ADDRESS:

TELEPHONE:

Fax:

E – MAIL ADDRESS:

REPRESENTED BY:

TITLE :

(Hereinafter shall be referred to collectively as “Parties” or singularly as “Party”).

Whereas, the parties mutually accept to refer to the General Terms and Definitions, as set out by the INCOTERMS Edition 2000 with latest amendments, having the following terminology fully understood and accepted:

THIS CONTRACT IS MADE BY AND BETWEEN THE SELLER AND BUYER WHEREBY THE SELLER AGREES TO SELL AND BUYER AGREES TO BUY THE UNDER MENTIONED GOODS ON THE TERMS AND CONDITIONS STATED BELOW.

Whereas:

(1) All parties confirm that each is fully empowered, legally qualified, and duly authorized to execute and deliver this document, and to be bound by its terms and conditions.

(2) The Parties hereby warrant and declare that all funds applied in the conduct of this transaction are good, clear, clean authentic, legally earned and of non-criminal origin.

(3) The Parties hereby warrant and declare that the transaction and contract are not entered into in order to facilitate and advance terrorist activities, drug trafficking and/or illegal arms dealings.

(4) The parties have by mutual request to each other reached agreement for the purchase and sale of specified commodities

In consideration of the representations, warranties, covenants and agreements made by and between the parties, it is hereby agreed that the parties shall proceed to execution on the following terms and conditions.

ARTICLE 1. COMMODITIES UNDER SALE: Used Rail Scrap (R50& R65) GOST-8165-75

ARTICLE 2. COUNTRY OF ORIGIN: RUSSIA

ARTICLE 3.SPECIFICATIONS, QUALITY AND STANDARD:

R-50(51,57KG/m GOST 7173-75) R60-65 (64,72KG/m GOST -8165-75) ISRI CODE 27-29 (ALL LENGTH OF RAILS WILL BE CUT TO BUYER’S SPECIFICATION AT NO ADDITIONAL COST)

ARTICLE 4. QUANTITY AND DELIVERY

Quantity per month: 30,000MT (+/- 5%)

,

• Cutting Length of the rail: 1.0m ~ 1.5m

ARTICLE 5. UNIT PRICE and TOTAL VALUE AND VOLUME OF THE CONTRACT:

1. Unit Price: US$ 430 per metric ton CNF, ASWP, by Bulk 30,000MT volume by weight per month: CNF USD$12,900,000 per month (TWELVE Million

9 hundred thousand United State Dollars only) depending

upon delivery quantity.

ARTICLE 6. TRANSACTION PROCEDURES:

1. Seller sends Draft contract in DOC

2. Seller sends the final contract in PDF

3. Buyer issues Russia Bank by swift

4. Seller Russia Bank issues answer by swift

5. Buyer issues Transferable letter of credit

6. Seller Transfers end Seller’s performance Bond

USD250,000 (Two hundred Fifty thousand US dollars only)

7. Shipment commences as agreed in the contract.

ARTICLE 7. PORT OF DISCHARGE (DESTINATION PORT): CNF, ASWP

ARTICLE 8. DISCHARGING RATE :… MT/DAY

ARTICLE 9. LOADING PORT: VLADIVOSTOK

ARTICLE 10. LOADING AND DISCHARGING TERMS:

a) Terms and conditions of loading and discharging inclusive of loading rate/discharging rate shall be compliant with the rules and norms of the port of loading and discharging and shall in be in accordance with INCOTERMS 2000. Any demurrage incurred at the port of loading will be at Seller’s costs. Any demurrage incurred after the free demurrage period at the discharging port will be on Buyer’s account.

b) All provisions included in the Delivery Schedule will be observed by both Buyer and Seller and breaches in the provisions shall be subject to penalties as per the penalty clause of this contract.

c) The Parties may agree upon the extension of the delivery period. On this event, the Party responsible for the delays (Seller in delivery or Buyer in unloading) shall bear the costs for the extension of the validity of the letter of credit or any payment instrument acceptable by seller.

ARTICLE 11. GUARANTEE OF PAYMENT BY BUYER

Payment for consignment in favor of the Seller in the approximate amount shall be effected by irrevocable Transferable Letter of Credit Payable 100% at Sight.

ARTICLE 12. PAYMENT TERMS AND CONDITIONS:

Payments due under this contract shall be effected by an irrevocable, transferable, Documentary letter of credit value100% at sight. And this DLC will activate automatically the Non-operative PB issued by the Seller.

Collection of payments for shipments by the Seller shall proceed by the presentation of documents specified in the non-operative letter of credit by Seller’s bank to the Buyer’s issuing bank.

ARTICLE 13. BANK CHARGES:

Bank charges for any amendments of the letter of credit value100%. Payable at Sight shall be borne by the Party at fault, being the party whose act or commissions have necessitated the changes.

ARTICLE 14. SHIPMENT:

a) The shipment of (30,000Metric Tons), (+/-5%) shall be delivered within 30 days from the day of receiving buyer’s receipt of payment instrument.

b) The Seller shall inform the Buyer by email or fax the exact time of departure of the vessel at the loading port, voyage itinerary and routing and estimated time of arrival at the port of discharge designated by Buyer, within 72 hours of notification for the Buyer to make necessary arrangements.

ARTICLE 15. SHIPPING DOCUMENTS:

Buyer’s bank shall make payment to Sellers bank upon presentation of following shipping documents by the Sellers Bank to the Buyer’s designated bank:

a) Original signed and stamped commercial invoice covering the description, unit price, loading quantity, total amount and copies each in triplicate (3/3) issued by the Seller.

b) Original signed and stamped packing list indicating total shipped on board quantity, and

Copies each in triplicate (3/3) issued by the Seller.

c) Original signed and stamped draft survey report and copies each in triplicate (3/3) issued by Society Generate de Surveillance (SGS) at loading port. (SGS is at Seller’s costs)

d)Signed and stamped quality & Quantity inspection certificate and copy each in triplicate (3/3) issued by Society Generate de Surveillance (SGS) inspection certificates at loading port, SGS is at Seller’s costs,

e) One original and three copies (1/3) of certificate of origin issued by Chamber of Commerce of loading country.

f) Full (3/3) set of original of clean shipped on board bill(s) of lading, made out to Buyer and blank endorsed, signed and stamped by the shipmaster,. Showing notifying Buyer marked “Ocean Freight prepaid.

g) One original and three copies (1/3) of pre-shipment inspection certificates issued by SGS certifying that the commodity is free from radioactive materials, free from closed containers and any explosive materials, free from materials that will cause environment pollution and certifying that shipped materials are in conformity with steel scrap standard ISRI 200-206.

h) Certificate of non-wood substance in two (2) originals to be issued by the Seller.

i) Seller’s / Beneficiary’s certificate including courier receipt certifying that a full set of non-negotiable shipping documents and full set of original clean on board ocean bill of lading has been sent directly to the Buyer by courier service within the next four (4) banking days from the date of loading.

j) One copy of shipping advice bearing the vessel’s name and registration number and date; weight shown on the Bill of Lading, the Contract number and Transaction Code, name of commodity; invoice value; ETA to the discharging port as sent to the Buyer within three (3) working days after shipment date.

ARTICLE 16. WEIGHT SURVEY:

Weight for invoice purposes shall be established at the loading port by Society Generate Surveillance (SGS), the report of draft survey at the loading Port shall be for Invoicing only, and SGS issued at the Seller’s account.

ARTICLE 17. INSPECTION:

BY SGS (RUSSIAN BRANCH) OR BUYER’S GOVERNMNET AUTHENTICATE INSPECTION COMPANY.

a) Access for goods Inspections sought by the Buyer and/or its representatives shall be granted only after notarization/registration of the contract with the Russian ministries.

b) Inspection shall be done at port of loading by Society Generate Surveillance (SGS) The Seller will pay inspection fee for SGS only, Fees for the Buyer’s inspection at yard will be paid by Buyer, at the discharge port. Weight inspections respectively done by SGS at the loading port shall be final and binding upon both Parties on any issues relating to weights and measures of the quantity or quality of goods delivered.

SGS INSPECTION: THIS MUST BE DONE AT LOADING PORT AT SELLER’S COST.

c) The Seller shall on Buyers request within three working days (3) after the date of confirming the mandatory payment for contract notarization/registration with appropriate authorities in Russia. If buyer wishes, an invitation letter will be sent to the Buyer and Buyer’s representative to be issued with a business or other appropriate visa to enable such representative travel down to RUSSIA to verify the availability of the goods or its quality at the yard/port of loading and at the Buyer’s own expense.

ARTICLE 18. IMPORTATION ARRANGEMENT:

a) Buyer understands and acknowledges full responsibility for the prompt settlement and/or discharge of any import tariff (value added tax), custom duty, terminal handling charge, and/or demurrage charges arising at the port of discharge.

b) Buyer understands and acknowledges full responsibility for the prompt procurement of such import licenses and/or permit (quota) required for processing the goods at the port of discharge.

ARTICLE 19. QUANTITY ADJUSTMENT:

a) The Parties agree and commit to respond to each other promptly on all issues giving rise to a need for quantity adjustments in the course of shipments.

b) If a quantity difference is established satisfactorily by survey reports in the course of shipments, payment adjustments shall automatically fall due and shall in the first instance be arranged by means of debit and/or credit notes being issued on a pro rata basis to the Buyer within 10 days from the date of receipt of weight or quantity survey reports issued at the port of discharge.

c) No action shall require to be taken by the parties in relation to adjustments where any deviation in weight or quantity delivered does not exceed 0.1%.

d) Any issues relating to the weight or quantity deviations shall be resolved by reference to SGS quantity surveys executed at the port of loading and by reference to certificates based on surveys at the port of discharge issued by the Administration of Quality Supervision,