Exhibit 10.1

 

 

 

 

REPURCHASE AGREEMENT

 

This REPURCHASE AGREEMENT (this “Agreement”) dated as of January 27, 2014 is
made by and among China Biologic Products, Inc., a Delaware corporation (the
“Company”), Ms. Siu Ling Chan, a Hong Kong resident (ID No. P725946(1),
“Seller”) and Mr. Lam Tung, a Hong Kong resident (ID No. P665194(5), “Seller
Affiliate”). The Company, Seller and Seller Affiliate are hereinafter referred
to as the “Parties” and each a “Party”.

 

WHEREAS, Seller desires to sell to the Company, and the Company desires to
repurchase and acquire from Seller, an aggregate of 2,500,000 shares of common
stock (“Common Stock”), par value US$0.0001 per share, of the Company.

 

WHEREAS, after giving effect to the transactions contemplated by this Agreement,
Seller will still own 2,862,624 shares of Common Stock (the “Remaining Shares”).

 

NOW THEREFORE, in consideration of the foregoing and the mutual promises,
covenants and agreements of the Parties contained herein, the Parties agree as
follows:

 

ARTICLE I

DEFINITIONS

 

1.1 Definitions. The following terms shall have the following meanings for
purposes of this Agreement:

 

“Business Day” means a day other than Saturday, Sunday or any day on which banks
located in Hong Kong or the United States are authorized or obligated to close.

 

“Change of Control Transaction” means a transaction involving the sale of all or
substantially all the assets of the Company; any merger, consolidation or
acquisition of the Company with, by or into another Person; or any change in the
ownership of more than 50% of the voting capital stock of the Company in one or
more related transactions.

 

“Commission” means the United States Securities and Exchange Commission.

 

“Government Authority” means any government or political subdivision thereof,
whether on a federal, central, state, provincial, municipal or local level and
whether executive, legislative or judicial in nature, including any agency,
arbitrator, authority, board, bureau, commission, court, department, official,
tribunal or other instrumentality thereof.

 

“HK Court” means the High Court of the Hong Kong Special Administrative Region,
Court of First Instance.

 

“HK Injunction” means the injunction issued by the HK Court in connection with
the HK Lawsuit on transfer of shares of Common Stock by Seller.

 

“HK Lawsuit” means the pending lawsuit in the HK Court against Seller and Seller
Affiliate with respect to 5,178,962 shares of Common Stock (Action No. 1424 of
2012).

 

1

 

 

“Law” means any law, treaty, statute, ordinance, code, rule or regulation of any
Government Authority or any Order.

 

“Order” means any writ, judgment, decree, injunction, award or similar order of
any Government Authority (in each such case whether preliminary or final).

 

“Person” means an individual, firm, corporation, partnership, association,
limited liability company, union, trust or estate or any other entity or
organization whether or not having separate legal existence, including any
Government Authority.

 

“Plaintiffs’ means the plaintiffs in the HK Lawsuit.

 

“Plaintiffs’ Agent” means Beijing Shengyuan Junhe Risk Management Consulting
Co., Ltd. (北京盛元君和风险管理咨询有限公司), the agent representing the Plaintiffs in the HK
Lawsuit.

 

“Registrable Securities” means: (i) the Remaining Shares and (ii) any securities
issued or issuable upon any stock split, dividend or other distribution,
recapitalization or similar event, or any exercise price adjustment with respect
to any of the Remaining Shares; provided however, that once any such securities
referred to in foregoing clauses (i) or (ii) have been sold pursuant to a
Registration Statement, they shall no longer constitute Registrable Securities.

 

“Registration Statement” means any registration statement required to be filed
in accordance with this Agreement to register the Remaining Securities including
the prospectus, amendments and supplements to such registration statement or
prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference therein.

 

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.

 

“Rule 415” means Rule 415 promulgated by the Commission pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.

 

“Securities Act” means the Securities Act of 1933, as amended.

 

“Seller Options” means the options to purchase Common Stock that were granted to
Seller by the Company.

 

“Settlement Completion” means the completion of (i) the Closing; (ii) the
closing of the transactions contemplated by the Settlement Agreement and the
other actions contemplated thereby, including full payment of the settlement
amount under the Settlement Agreement and the withdrawal by the Plaintiffs of
all their claims in the HK Lawsuit; and (iii) the revocation by the HK Court of
the HK Injunction.

 

2

 

 

“Settlement Agreement” means the settlement agreement entered into by and among
Seller, Seller Affiliate, the Plaintiffs and the Plaintiffs’ Agent on January
27, 2014.

 

“Settlement Amount” means the aggregate amount to be paid by Seller and Seller
Affiliate to the Plaintiffs and the Plaintiffs’ Agent under Section 1.1 of the
Settlement Agreement to settle the HK Lawsuit.

 

“US$” means the United States Dollar, the lawful currency of the United States
of America.

 

ARTICLE II

REPURCHASE OF SHARES

 

2.1 Repurchase and Sale of Shares. At the Closing, and subject to and upon the
fulfillment of the terms and conditions set forth in this Agreement, the Company
shall repurchase from Seller, and Seller shall sell and deliver to the Company,
2,500,000 shares of Common Stock (the “Subject Shares”) for US$28.00 per Subject
Share. The aggregate purchase price for the Subject Shares shall be
US$70,000,000 (the “Purchase Price”).

 

2.2 Closing.

 

(a) The closing of the repurchase of the Subject Shares contemplated hereunder
(the “Closing”) shall take place on a Business Day in the Hong Kong offices of
Wilson Sonsini Goodrich & Rosati P.C. at Unit 1001, 10/F, Henley Building, 5
Queens Road Central, Hong Kong, or at such other location as may be mutually
agreed by the Parties, as soon as practicable but no later than three Business
Days following the date upon which all of the conditions set forth in
Article VI, other than those that by their nature may only be satisfied or
waived at the Closing, have been satisfied or waived as of the date of the
Closing, or such other date as the Parties may mutually agree (the “Closing
Date”).

 

(b) At the Closing, Seller shall deliver or cause to be delivered the following
documents to the Company or the transfer agent of the Company against payment of
the Purchase Price by the Company: (i) original of one or more certificate(s)
evidencing the Subject Shares (the “Share Certificates”), accompanied by duly
executed irrevocable stock powers in such form as required by the transfer
agent, with any required transfer stamps affixed thereto (the “Stock Powers”),
(ii) a duly executed letter of instruction from Seller, in such form as required
by the transfer agent, instructing the transfer agent to register the Subject
Shares as having been repurchased by the Company (the “Transfer Instruction”),
and (iii) such other documents as may be reasonably required by the transfer
agent in order to complete the repurchase and acquisition of the Subject Shares
from Seller by the Company (together with the Share Certificates, the Stock
Powers and the Transfer Instruction, the “Seller Deliverables”).

 

(c) At the Closing, Seller and the Company shall take the following actions in
the sequence set out below:

 

(i) upon the Company’s inspection of the Seller Deliverables to its
satisfaction, the Company shall deliver or cause to be delivered (A) the
Settlement Amount to the Plaintiffs and the Plaintiffs’ Agent by initiating a
wire transfer of immediately available funds to one or more accounts designated
in writing by Wilkinson & Grist, the Hong Kong counsel to the Plaintiffs and the
Plaintiffs’ Agent in the HK Lawsuit, no later than five (5) Business Days prior
to the Closing Date, and (B) an amount equal to (x) the Purchase Price minus (y)
the Settlement Amount to Seller by initiating a wire transfer of immediately
available funds to one or more accounts designated by Seller in writing no later
than five (5) Business Days prior to the Closing Date; and

3

 

 

 

(ii) immediately upon the Company’s presentation to Seller of the irrevocable
instruction initiating the wire transfer(s) as set forth in 2.2(c)(i) above,
Seller shall deliver the Seller Deliverables in accordance with Section 2.2(b).

 

For the avoidance of doubt, the provisions under this Section 2.2(c) are
intended to describe the agreed mechanics of the Closing only but the Closing
shall not be deemed to have consummated until all deliveries described in
Section 2.2(b) shall have been made, including, without limitation, receipt of
the Purchase Price by Seller, the Plaintiffs and the Plaintiffs’ Agent, and all
such deliverables (including without limitation payment of the Purchase Price)
shall be deemed to occur simultaneously and to be conditioned upon each other.

 

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SELLER AND SELLER AFFILIATE

 

Seller and Seller Affiliate hereby jointly and severally represent and warrant
to the Company as of the date hereof and as of the Closing Date as follows:

 

3.1 Authorization; Enforcement; Validity. This Agreement has been duly and
validly executed and delivered by Seller and Seller Affiliate, and is a valid
and binding obligation of Seller and Seller Affiliate enforceable against Seller
and Seller Affiliate in accordance with the respective terms herein.

 

3.2 No Conflict. Subject to compliance with the Settlement Agreement, the
execution and delivery by Seller and Seller Affiliate of this Agreement, and the
performance by Seller and Seller Affiliate of their obligations hereunder, as of
the date hereof do not and as of the Closing Date will not (i) violate or
contravene any provision of applicable Law, or (ii) violate or contravene, or
require any consent or other action by any Person under, constitute a default
under, any agreement, contract or note binding upon Seller or Seller Affiliate.

 

3.3 Ownership of Subject Shares. The Subject Shares have been duly authorized
and validly issued and are fully paid and non-assessable. Other than the
transfer restrictions under the Settlement Agreement and the HK Lawsuit,
(i) Seller is and on the Closing Date will be the record and beneficial owner of
the Subject Shares, free and clear of all security interests, claims (pending or
threatened), liens, pledges, charges, equities or other encumbrances,
limitations or restrictions (including any restriction on the right to vote,
sell or otherwise dispose of such Subject Shares) (“Encumbrances”), and
(ii) Seller has the legal right and power, and all authorization and approval
required by law, to enter into this Agreement and to sell, transfer and deliver
the Subject Shares free and clear of all Encumbrances. The HK Lawsuit is the
only adverse claim in respect of the Subject Shares’ title that Seller and
Seller Affiliate are aware of.

 

4

 

 

3.4 No Approvals. Subject to compliance with the Settlement Agreement, no filing
with, or consent, approval, authorization, order, registration, qualification or
decree of, any court or governmental authority or agency, domestic or foreign,
is necessary or required for the execution and delivery of this Agreement, the
performance by Seller and Seller Affiliate of their obligations hereunder or in
connection with the sale and delivery of the Subject Shares hereunder or the
consummation of the transactions contemplated by this Agreement.

 

3.5 Seller’s Status. Seller is a sophisticated investor with sufficient
investment or financial knowledge and experience as well as knowledge in the
Company, which enable her to properly evaluate the risks and merits of her
participation in the transaction contemplated hereunder and protect her own
interest in connection therewith. Seller has made a determination based on her
own independent review and such professional advice as she deems appropriate
that (i) her consideration of the sale of the Subject Shares to the Company in
the transaction contemplated hereunder is fully consistent with her financial
needs, objectives and condition, and (ii) the terms of the transaction
contemplated hereunder have been agreed through arm’s-length negotiation and are
fair to Seller.

 

3.6 Purchase Price. Seller fully understands that the Purchase Price may be less
than the current trading price of the Subject Shares and believes that, due to
the size of Seller’s holdings, any attempt to dispose of the Subject Shares on
the public market would most likely drive the market price down and result in an
average price per share that is less than an amount equaling (x) the Purchase
Price divided by (y) the number of Subject Shares.

 

3.7 Settlement Agreement. The Settlement Agreement has been duly and validly
executed and delivered by each of the parties thereto, is effective, and
constitutes valid and binding obligations of Seller and Seller Affiliate and
enforceable against Seller and Seller Affiliate in accordance with the terms
therein. The effectiveness and enforceability of the Settlement Agreement is not
dependent or conditioned upon any Government Authority approval or consent.

 

3.8 Information. Seller acknowledges that (i) Seller and Seller Affiliate have
received and reviewed the Company’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2012, Quarterly Report on Form 10-Q for the quarters
ended March 31, 2013, June 30, 2013 and September 30, 2013 respectively and the
Company’s Current Reports on Form 8-K filed with the SEC after September 30,
2013, and the other filings made by the Company with the SEC, (ii) Seller was a
director of the Company and had access to material non-public information
relating to the Company, and (iii) Seller and Seller Affiliate are familiar with
the Company’s business and financial conditions. Seller further acknowledges
that the Company has informed Seller that the Company may have material
non-public information regarding the Company (“MNPI”). Such MNPI, when it is
eventually available and disclosed publicly, may cause the market price of the
Company’s common stock to increase or decrease substantially. Seller
understands, based on her experience, the disadvantage to which Seller is
subject due to the disparity of information between the Company and Seller.
Notwithstanding this, Seller desires to engage in the transaction contemplated
hereunder. Seller hereby waives any future claim that Seller might have based on
the failure by the Company to disclose the MNPI and expressly releases the
Company from any and all liabilities arising from the Company’s failure to
disclose such MNPI, and Seller agrees to make no claim against the Company in
respect of the transaction contemplated under this Agreement related to the
Company’s failure to disclose such MNPI to Seller, except with respect to
representations, warranties, covenants and agreements expressly made by the
Company in this Agreement. Based on such information and investigation as Seller
has deemed appropriate and without reliance upon any MNPI that the Company may
have, Seller has independently made her own analysis and decision to enter into
the transaction contemplated hereunder. Except for the representations,
warranties and agreements of the Company expressly set forth in this Agreement,
Seller is relying exclusively on her own sources of information, investment
analysis and due diligence (including such professional advice as she deems
appropriate) with respect to the transaction contemplated hereunder.

 

5

 

 

3.9 Foreign Corrupt Practices Act. Any proceeds received by Seller under this
Agreement will be received by Seller as principal and not as agent for others,
and no part of any payment hereunder will be paid or assigned to or shared with
any third party except for the payment of lawful costs and expenses. Neither
Seller nor Seller Affiliate is an officer or employee of, or acting in an
official capacity for, any Government Entity (as defined below), any political
party or official thereof, or any candidate for political office (individually
and collectively, a “Government Official”). Neither Seller nor Seller Affiliate
is holding or using any Subject Shares on behalf of any Government Official or
Government Entity. “Government Entity” as used in this Section 3.9 means any
government or any department, agency or instrumentality thereof, including any
entity or enterprise owned or controlled by a government or a public
international organization.

 

3.10 Joint Obligors. Seller and Seller Affiliate hereby represent and warrant
that they collectively act as one party under this Agreement and shall be
jointly and severally liable for any of their obligations hereunder.

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

The Company hereby represents and warrants to Seller and Seller Affiliate as of
the date hereof and as of the Closing Date as follows:

 

4.1 Authorization; Enforcement; Validity. The execution and delivery by the
Company of this Agreement, the performance by the Company of its obligations
hereunder and the consummation by the Company of the transactions contemplated
hereby have been duly authorized by all requisite corporate actions on the part
of the Company. This Agreement has been duly and validly executed and delivered
by the Company, and is a valid and binding obligation of the Company enforceable
against the Company in accordance with the respective terms herein.

 

4.2 No Conflict. The execution and delivery by the Company of this Agreement,
and the performance by the Company of its obligations hereunder, as of the date
hereof do not and as of the Closing Date will not (i) violate or contravene any
provision of applicable Law or Order, (ii) violate or contravene the certificate
of incorporation or by-laws of the Company, or (iii) violate or contravene, or
require any consent or other action by any Person under, constitute a default
under, any agreement, contract or note binding upon the Company.

 

6

 

 

4.3 No Approvals. No filing with, or consent, approval, authorization, order,
registration, qualification or decree of, any court or governmental authority or
agency, domestic or foreign, is necessary or required for the execution and
delivery of this Agreement, the performance by the Company of its obligations
hereunder or the consummation of the transactions contemplated by this
Agreement.

 

4.4 Funds. The Company will have sufficient funds lawfully available to pay the
Purchase Price at Closing and effect the repurchase of the Subject Shares
contemplated hereby.

 

4.5 Independent Investigation. The Company acknowledges that neither Seller nor
Seller Affiliate has made any representation or warranty except as expressly set
forth in Article III of this Agreement and in making its decision to enter into
this Agreement and to consummate the transactions contemplated hereby, the
Company has relied solely on its own investigation and the express
representations and warranties of Seller and Seller Affiliate set forth in
Article III of this Agreement.

 

ARTICLE V

COVENANTS AND AGREEMENTS

 

5.1 Restrictive Legends. To the extent any of the Remaining Shares are
represented by a certificate that bears a legend restricting transfer of such
Remaining Shares, the Company shall use its commercially reasonable efforts to
cause the Company’s transfer agent to remove such restrictive legend and provide
Seller with one or more certificates for such Remaining Shares as instructed by
Seller free from any restrictive legends. The Company hereby acknowledges that
neither Seller nor Seller Affiliate is an “affiliate” of the Company as the term
is defined under Rule 144.

 

5.2 Transfer of Remaining Shares. The Company agrees that, after the Settlement
Completion, Seller may transfer all or any portion of the Remaining Shares in
one or more transactions (including, for the avoidance of doubt, initially
transferring all the Remaining Shares to a company organized in the British
Virgin Islands directly or indirectly wholly owned by a daughter of Seller and
Seller Affiliate) so long as such transfer(s) shall be in compliance with
applicable Laws and the transfer restriction set forth below in this Section
5.2. The Company shall use its commercially reasonable efforts to assist with
such transfer(s), including causing the Company’s transfer agent to cooperate
with such transfer(s). Notwithstanding anything to the contrary contained
herein, Seller shall not, and shall cause her permitted assignee not to, sell or
transfer, directly or indirectly, any Remaining Shares to any company that
engages in the plasma related business in China or controlling shareholder(s) of
any such company (collectively, “Restricted Transferees”) without the prior
approval by the board of directors of the Company. For the avoidance of doubt,
the foregoing transfer restriction shall not apply to the sale or transfer of
the Remaining Shares to a Restricted Transferee in connection with or as part of
a Change of Control Transaction.

7

 

 

 

5.3 Registration Rights. As a material inducement to Seller to enter into this
Agreement, the Company shall, upon a request from Seller or Seller’s permitted
assigns after the Settlement Completion, use commercially reasonable efforts to
prepare and file with the Commission a Registration Statement covering the
resale of all Registrable Securities for an offering to be made on a continuous
basis pursuant to Rule 415. If, after the Settlement Completion, the Company
proposes to file a registration statement under the Securities Act providing for
a public offering of the Company’s securities, the Company shall notify Seller
or Seller’s permitted transferee of the proposed filing and afford Seller or
Seller’s permitted assigns an opportunity to include in such registration
statement all or any part of the Registrable Securities then held by Seller or
Seller’s permitted assigns.

 

5.4 Seller Options. As a further material inducement to Seller to enter into
this Agreement and notwithstanding anything to the contrary in any other
agreement or arrangement between Seller and the Company prior to the date of
this Agreement, the Company agrees to allow Seller to exercise the Seller
Options in one or more transactions at any time following the Closing but prior
to the date that one month following the Closing. For the avoidance of doubt and
without limiting the generality of the foregoing, during such period Seller
shall not be restricted or prevented from exercising the Seller Options by any
trading blackout window imposed by the Company (under its insider trading policy
or otherwise). Any securities received by Seller as a result of her due exercise
of the Seller Options shall be considered Remaining Shares for the purposes of
this Agreement.

 

5.5 Further Cooperation. Subject to the terms and conditions provided herein,
each of the Parties shall use commercially reasonable efforts to promptly take,
or cause to be taken, all necessary actions proper under applicable Laws, to
obtain consents or provide notices or effect registrations and filing or remove
impediments necessary to consummate the transactions contemplated hereby as
promptly as practicable following the date hereof. Each Party shall execute and
deliver at the Closing documents required to be executed and delivered by it as
Closing conditions, shall take all steps necessary and proceed diligently and
act in good faith to satisfy each condition in Article VI and shall not take or
fail to take any action that could reasonably be expected to result in the
non-fulfillment or delay of any such condition.

 

5.6 Exclusivity. Without the prior written consent of the Company, during the
period starting from the date hereof and ending on the earlier date of (x) the
Long Stop Date (as defined below), and (y) the date when this Agreement is
terminated in accordance with Section 8.1(a) (the “Exclusive Period”), neither
Seller nor Seller Affiliate, or any of their agents, representatives or advisors
shall contact, discuss or negotiate with any third party (other than in
connection with the performance by Seller and Seller Affiliate under the
Settlement Agreement or as required by any Law or Order under the HK Lawsuit)
with respect to (i) any transaction relating to the sale, acquisition, exchange,
pledge, or transfer of any securities of the Company held by Seller; or (ii) any
contract, agreement, arrangement, understanding or other commitments relating to
potential disposal, voting, settlement or other arrangements in relation to
shares of Common Stock held by Seller.

 

8

 

 

During the Exclusive Period, Seller and Seller Affiliate shall not, and shall
cause their agents, representatives and advisors not to, take any action to
initiate, contact, induce, solicit, encourage, participate or assist any Person
other than the Company and its affiliates in any offer, inquires, discussions,
proposals or negotiations in connection with any transaction, contract,
agreement, arrangement or commitments referred to above other than in connection
with the performance by Seller and Seller Affiliate under the Settlement
Agreement or as required by any Law or Order under the HK Lawsuit. During the
Exclusive Period, Seller shall not sell, transfer or otherwise dispose or
subject to any Encumbrance, any shares of Common Stock registered under the name
of Seller, except that such restriction shall not apply to any sale of such
shares by Seller in accordance with the Order of any court of competent
jurisdiction.

 

5.7 Confidentiality. Except as otherwise required by applicable Law, or
regulations of stock exchange, or otherwise permitted by this Agreement, the
Company, on the one hand, and Seller and Seller Affiliate, on the other hand,
shall not disclose to any third party any content or information in connection
with this Agreement and the transactions contemplated hereby, or non-public
information relating to the other Party (“Confidential Information”) without the
prior consent of the other Party and shall keep Confidential Information
strictly confidential. The Company may disclose Confidential Information to its
and its affiliates’ directors, officers, managers, employees, investors and
potential investors and the Company, Seller and Seller Affiliate may disclose
Confidential Information to their respective professional advisers, accountants
or lawyers on a need-to-know basis; provided, however, that the disclosing Party
shall ensure that such Persons are subject to the same confidentiality
obligation as they were under this Agreement. Notwithstanding anything herein to
the contrary, the Parties acknowledge that (i) Seller may be required to file
with the SEC such schedules and forms as may be required under Section 13(d) and
Section 16 of the United States Securities Exchange Act of 1934, as amended (the
“Exchange Act”), as applicable and (ii) the Company may be required to file with
the SEC such forms as may be required under the Exchange Act, each of which may
need to disclose information with respect to the transactions contemplated
hereby and contain as an exhibit thereto a copy of this Agreement, and nothing
contained in this Section ‎5.7 is intended to limit or restrict such ability to
file such schedules and forms or any amendments thereto. To the extent
practicable and permitted by applicable Law, prior to Seller’s or the Company’s
disclosure of Confidential Information to a Government Authority or stock
exchange (including Seller’s or the Company’s disclosure to the SEC), Seller or
the Company shall notify each other in advance of such disclosure and shall
obtain each other’s consent with respect to the contents of such disclosure,
which consent shall not be unreasonably withheld or delayed.

 

5.8 No Claim by Seller or Seller Affiliate. Following Closing, which shall have
occurred in accordance with the terms and conditions of this Agreement, Seller
and Seller Affiliate hereby irrevocably waive their right to, and undertake that
they shall not, make any claim (whether directly or indirectly through third
parties) or take any other action against the Company, its and its affiliates’
directors, officers, employees, shareholders, owners, representatives, agents or
advisors, for any reason or cause, other than with respect to any inaccuracy in
or breach of any representation or warranty of the Company under this Agreement,
in connection with the Subject Shares, this Agreement or the transactions
contemplated hereby.

 

5.9 Stock-Splits, Reclassification or Reorganization. If after the date hereof
and prior to Closing, the number of Common Stock is increased or decreased as a
result of a stock dividend, a subdivision or split-up of Common Stock, a
consolidation, combination, reverse stock split, reorganization or
reclassification of Common Stock, a merger with or into or consolidation with
another corporation undertaken by the Company, or any other similar event, the
number of Subject Shares to be sold by Seller hereunder and the Purchase Price
for such Subject Shares shall be appropriately and equitably adjusted to reflect
the intent of the agreement set forth in Section 2.1.

 

9

 

 

5.10 Performance of Settlement Agreement. Seller and Seller Affiliate shall,
jointly and severally, duly perform all of their obligations under the
Settlement Agreement.

 

5.11 Delivery of Share Certificates. Seller and Seller Affiliate shall use
commercially reasonable efforts to cause the Share Certificates to be delivered
to the Company or the transfer agent of the Company on or prior to the Closing.
The Company shall use its commercially reasonable efforts to, upon the receipt
by the Company or the Company’s transfer agent of the relevant affidavit of lost
stock certificate, assist Seller in obtaining a replacement certificate for
Seller’s lost stock certificate (Certificate No. 819) representing 215,000
shares of Common Stock or cancel such lost certificate and reissue to Seller a
new certificate representing such shares of Common Stock, including using its
commercially reasonable efforts in causing the Company’s transfer agent to waive
any requirement for bond money from Seller in connection with such replacement
or reissuance certificate.

 

ARTICLE VI

CONDITIONS TO CLOSING

 

6.1 Conditions to Seller’s Obligations. The obligation of Seller to proceed with
the Closing is subject to the fulfillment, at or before the Closing, of each of
the following conditions (all or any of which may be waived in whole or in part
by Seller jointly in their sole discretion):

 

(a) Representations and Warranties. Each of the representations and warranties
made by the Company in this Agreement shall be true and correct in all respects
on and as of the Closing Date as though such representation or warranty was made
on and as of the Closing Date.

 

(b) Performance. The Company shall have performed and complied with each
agreement, covenant and obligation required by this Agreement to be so performed
or complied with by it in all material respects at or before the Closing.

 

(c) Injunctions; Illegality. No provision of any applicable Law or Order shall
restrain, enjoin or otherwise prohibit the consummation of the Closing.

 

(d) Settlement Agreement. The Settlement Agreement shall be effective and valid.

 

6.2 Conditions to the Company’s Obligations. The obligation of the Company to
proceed with the Closing is subject to the fulfillment, at or before the
Closing, of each of the following conditions (all or any of which may be waived
in whole or in part by the Company in its sole discretion):

 

10

 

 

(a) Representations and Warranties. Each of the representations and warranties
made by Seller and Seller Affiliate in this Agreement shall be true and correct
in all respects on and as of the Closing Date as though such representation or
warranty was made on and as of the Closing Date.

 

(b) Performance. Seller and Seller Affiliate shall have performed and complied
with each agreement, covenant and obligation required by this Agreement to be so
performed or complied with by Seller and Seller Affiliate at or before the
Closing.

 

(c) Injunctions; Illegality. No provision of any applicable Law shall restrain,
enjoin or otherwise prohibit the consummation of the Closing. The injunction
order issued on May 31, 2013 by the HK Court prohibiting Seller from disposing
of, charging, encumbering, pledging, transferring, diminishing the value of or
otherwise dealing with the shares of Common Stock held in Seller’s name shall
have been lifted.

 

(d) Settlement Agreement. The Settlement Agreement shall be effective and valid.

 

ARTICLE VII

INDEMNIFICATION

 

7.1 Indemnification by Seller and Seller Affiliate. Seller and Seller Affiliate
shall indemnify the Company and each of its and its affiliates’ directors,
officers, employees, shareholders, owners, representatives, agents and advisors
(collectively, the “Indemnified Parties”) and save and hold each of them
harmless against any direct losses (the “Losses”) suffered, incurred or paid by
the Indemnified Parties (including reasonable legal fees), arising from, as a
result of or in connection with: (i) any failure of any representation or
warranty made by Seller and Seller Affiliate in Article III to be true and
correct in all respects as of the date hereof and as of the Closing Date;
(ii) any breach of any covenant or agreement by Seller or Seller Affiliate
contained in this Agreement; (iii) the HK Lawsuit or the Settlement Agreement or
(iv) any other claims or actions with respect to Seller’s ownership of the
Subject Shares.

 

7.2 Limitation.

 

(a) The aggregate amount of all Losses for which Seller and Seller Affiliate
shall be liable pursuant to Section 7.1 shall not exceed 110% of the Purchase
Price.

 

(b) Net payments by Seller and Seller Affiliate pursuant to Section 7.1 in
respect of any Losses shall be limited to the amount of any liability or damage
that remains after deducting therefrom any insurance proceeds and any indemnity,
contribution or other similar payment actually received by the Indemnified
Parties in respect of any such claim. The Company shall, and shall procure the
other Indemnified Parties to, use its or their commercially reasonable efforts
to recover under insurance policies or indemnity, contribution or other similar
agreements, if any, for any Losses and shall promptly refund any such recovery
received by the Indemnified Party to Seller and Seller Affiliate.

 

11

 

 

(c) In no event shall Seller or Seller Affiliate be liable to any Indemnified
Party for any punitive, incidental, consequential, special or indirect damages,
including Loss of profit or opportunity.

 

7.3 Exclusive Remedies. Subject to Section 8.7, the Company acknowledges and
agrees that its sole and exclusive remedy with respect to any and all claims for
any breach of any representation, warranty, covenant, agreement or obligation of
Seller and Seller Affiliate set forth herein, shall be pursuant to the
indemnification provisions set forth in this Article VII.

 

ARTICLE VIII

GENERAL PROVISIONS

 

8.1 Termination.

 

(a) This Agreement may be terminated and the transactions contemplated by this
Agreement may be abandoned at any time prior to the Closing:

 

(i) by a written agreement between the Parties;

 

(ii) by the Company or Seller if the Closing shall not have occurred by the date
that is two (2) months following the date hereof (the “Long Stop Date”);
provided that the right to terminate this Agreement under this
Section 8.1(a)(ii) shall not be available to any Party whose failure to fulfill
any obligation (including without limitation the obligations under Section ‎5.5)
under this Agreement shall be the cause of the failure of the Closing to occur
on or before such date;

 

(iii) by the Company if there has been a breach of any material covenant or a
breach of any material representation or warranty or other agreement
contemplated hereunder of Seller or Seller Affiliate, which breach would cause
the failure of any condition precedent set forth in Section 6.2;

 

(iv) automatically upon completion of transfer of any Subject Shares by Seller
to any third party pursuant to the Order of a court of competent jurisdiction
after the date hereof; or

 

(v) automatically upon termination of the Settlement Agreement.

 

(b) In the event of termination of this Agreement as provided in Section 8.1(a),
this Agreement shall forthwith become void, and there shall be no liability or
obligation on the part of the Parties hereto and, as applicable, the officers,
directors and shareholders of the Company; provided that (i) each Party shall
remain liable for any breaches of this Agreement or in any other instruments
delivered pursuant to this Agreement prior to its termination; and (ii) the
provisions of Section ‎5.7 and this Article VIII shall remain in full force and
effect and survive any termination of this Agreement. Notwithstanding anything
to the contrary in this Agreement, the Company agrees that neither Seller nor
Seller Affiliate shall be held liable in the event that this Agreement is
terminated pursuant to Section 8.1(a)(iv).

 

12

 

 

8.2 Amendment. This Agreement may be amended and any right hereunder extended or
waived) by the Parties at any time by execution of an instrument in writing
signed on behalf of each Party.

 

8.3 Expenses and Fees; Taxes. Unless otherwise agreed among the Parties, all
fees and expenses incurred in connection with the transactions contemplated by
this Agreement, including all legal, accounting, financial advisory, consulting
and all other fees and expenses of third parties incurred by a Party in
connection with the negotiation and effectuation of the terms and conditions of
this Agreement and the transactions contemplated hereby, shall be the obligation
of the respective Party incurring such fees and expenses. Each Party shall
comply with all applicable tax Law and be responsible for and pay all of its own
taxes and government levies as required under applicable Law.

 

8.4 Notices. All notices and other communications hereunder shall be in writing
and shall be deemed given when delivered personally or by commercial messenger
or courier service, or mailed by registered or certified mail (return receipt
requested) or sent via facsimile or email (with acknowledgment of complete
transmission) to the Parties at the following addresses or at such other address
for a Party as shall be specified by like notice); provided, however, that
notices sent by mail will not be deemed given until received:

 

If to Seller and/or Seller Affiliate, to:

 

Mr. Tung Lam
Ms. Siuling Chan
c/o Dorsey & Whitney LLP

88 Queensway

Suite 3008 One Pacific Place

Hong Kong

Email: lam.tung@hotmail.com
Attention: Catherine X. Pan-Giordano, Esq.

 

If to the Company, to:

 

China Biologic Products, Inc.
18th Floor, Jialong International Building
19 Chaoyang Park Road
Chaoyang District, Beijing 100125
People’s Republic of China
Fax: +86-10-65983222
Attention: Chief Financial Officer

 

8.5 Counterparts; Facsimiles. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each
Party and delivered to the other Parties, it being understood that all Parties
need not sign the same counterpart for it to be effective among the Parties. A
facsimile, telecopy or other reproduction of this Agreement may be executed by
one or more Parties hereto and delivered by such Party by facsimile or any
similar electronic transmission device pursuant to which the signature of or on
behalf of such Party can be seen. Such execution and delivery shall be
considered valid, binding and effective for all purposes.

13

 

 

8.6 Severability. In the event that any provision of this Agreement or the
application thereof, becomes or is declared by a court of competent jurisdiction
to be illegal, void or unenforceable, the remainder of this Agreement will
continue in full force and effect and the application of such provision to other
Persons or circumstances will be interpreted so as reasonably to effect the
intent of the Parties. The Parties further agree to replace such void or
unenforceable provision of this Agreement with a valid and enforceable provision
that will achieve, to the extent possible, the economic, business and other
purposes of such void or unenforceable provision.

 

8.7 Specific Performance. The Parties hereto agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the Parties shall be entitled to seek an injunction
or injunctions without the need to post any bond or other financial assurances
in order to prevent breaches of this Agreement and to enforce specifically the
terms and provisions hereof in any court of the United States or any state,
province or other locale, both U.S. and non-U.S., having jurisdiction, this
being in addition to any other remedy to which they are entitled at law or in
equity.

 

8.8 Governing Law; Dispute Resolution. This Agreement shall be governed by and
construed in accordance with the laws of New York State, without regard to the
principle of conflict laws thereunder. All disputes between the Parties arising
out of or relating to this Agreement shall be finally settled at the Hong Kong
International Arbitration Centre (the “Centre”) in accordance with the Rules of
Arbitration of the Center by one arbitrator appointed in accordance with said
Arbitration Rules. The place of arbitration shall be in Hong Kong. The
arbitration shall be conducted in English. The resolution of any dispute by
arbitration pursuant to this Section 8.8 shall be non-appealable, final, binding
and conclusive on the Parties to such dispute and may be enforced and entered as
a judgment in any court of law with jurisdiction thereof. Notwithstanding the
foregoing, any Party shall be free to seek interim or permanent equitable or
injunctive relief, or both, from any court having jurisdiction to grant the
same.

 

8.9 Entire Agreement; No Third Party Beneficiaries; Assignment. This Agreement
and the documents and instruments and other agreements among the Parties hereto
referenced herein: (a) constitute the entire agreement among the Parties with
respect to the subject matter hereof and supersede all prior agreements and
understandings both written and oral, among the Parties with respect to the
subject matter hereof; (b) are not intended to confer upon any other Person any
rights or remedies hereunder; and (c) shall not be assigned by operation of law
or otherwise.

 

8.10 No Strict Construction. The language used in this Agreement will be deemed
to be the language chosen by the Parties to express their mutual intent, and no
rules of strict construction will be applied against any Party.

 

14

 

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written. 

 

  China Biologic Products, Inc.       By:  /s/ David (Xiaoying) Gao     Name:
David (Xiaoying) Gao   Title: Chief Executive Officer

 

15

 

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written. 

 

  Siu Ling Chan       /s/ Siu Ling Chan                       Lam Tung          
/s/ Lam Tung                            

 

 

 

 

 

 

16