EXHIBIT 10.13
 
SUMMARY OF SALE-LEASEBACK AGREEMENT
 
Parties:
 
Zhongxin Futong Capital Lease Co., Ltd. (“ZXFT”)
 
Zibo Jiazhou Chemical Industry Co., Ltd. (“ZBJZ”)
 
Date: November 1, 2010
 
Material Terms:
 
ZBJZ and ZXFT entered into a three-year sale-leaseback agreement (“Agreement”).
Pursuant to the Agreement, ZBJZ sold its machinery to ZXFT for RMB120,000,000
and leased the machinery back with a month rent of RMB3,815,967.92 (based on an
annual interest rate of 9% but subject to adjustments of the benchmark interest
rate made by People’s Bank of China). Of the RMB 120,000,000 sale price, ZBJZ
RMB4,200,000 was used to pay the initial cost and RMB 18,000,000 was treated as
a security deposit to guarantee ZBJZ’s performance of its obligations under the
Agreement. During the term of the Agreement, ZBJZ shall bear all the risks of
loss of the machinery and shall purchase at its own expenses insurance for the
machinery for a period that covers the term of the Agreement. In the event that
ZBJZ accelerates its rent payments, ZXFT shall be entitled to the remaining
interests under the Agreement. Upon expiration of the Agreement, ZBJZ shall pay
ZXFT RMB100,000 to purchase the machinery back. The payments to ZXFT under the
Agreement are guaranteed by Zibo Jiazhou Heat & Electricity Co., Ltd., Feng Lu
and Lianfang Zhang.