Exhibit 10.9

  

SHARE EXCHANGE AGREEMENT

 

THIS SHARE EXCHANGE AGREEMENT (the “Agreement”) is made and entered in this
__15___ day of April 2014 by and among Armco Metals Holdings, Inc., a Nevada
corporation (“AMCO”), Draco Resources, Inc., a California corporation (“Draco
Resources”), and Songqiang Chen, Jian Fang, Changlin Yan, Hongye Chen, Fanjie
Wang, Tong Huang, Honglin Zhang and Hongbing Lin (collectively the
“Shareholders”)

 

RECITALS:

 

A.           The Shareholders own 100% of the issued and outstanding capital
stock of Draco Resources (the “Draco Resources Shares”).

 

B.           AMCO desires to acquire the Draco Resources Shares from the
Shareholders in exchange for 13,950,000 shares of its post-split common stock
(the “AMCO Shares”) and a Series C stock purchase warrant (the "Series C
Warrant"). The Series C Warrant is exercisable for five years at any time,
following a 1:10 reverse stock split of our common stock, into 3,000,000 shares
of our post-split common stock at an exercise price of $3.40 per share.

 

C.           The Shareholders desire to exchange its Draco Resources Shares for
the AMCO Shares upon the terms and conditions set forth herein.

 

D.           It is the intention of the parties hereto that: (i) AMCO shall
acquire the Draco Resources Shares solely for the consideration set forth below
(the “Exchange”); (ii) the Exchange shall qualify as a transaction in securities
exempt from registration or qualification under the Securities Act of 1933, as
amended (the “Securities Act”), and under the applicable securities laws of the
jurisdiction where the Shareholders resides.

 

NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties contained in this Agreement, the parties hereto
agree as follows:

 

SECTION 1. EXCHANGE OF SHARES

 

1.1           Exchange of Shares. On the Closing Date (as hereinafter described)
the Shareholders shall tender the Draco Resources Shares to AMCO, and AMCO shall
issue the AMCO Shares to the Shareholders in exchange therefor. The
designations, rights and preferences of the Common Shares are set forth on
Exhibit A attached hereto and incorporated herein by such reference.

 

1.2           Delivery of Draco Resources Shares and the AMCO Shares. On the
Closing Date, the Shareholders will deliver to AMCO the certificate(s)
representing the Draco Resources Shares, duly endorsed for transfer (or with
executed stock power(s)) so as to convey good and marketable title to the Draco
Resources Shares to AMCO, and, simultaneously therewith, AMCO will deliver
certificates evidencing the AMCO Shares to the Shareholders, registered to the
Shareholders.

 

 

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SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS

 

The Shareholders represents and warrants to AMCO as follows:

 

2.1           Authorization; Enforceability; No Breach. The Shareholders has all
necessary power and authority to execute this Agreement and perform its
obligations hereunder. This Agreement constitutes the valid and binding
obligation of the Shareholders enforceable against it in accordance with its
terms, except as may be limited by bankruptcy, moratorium, insolvency or other
similar laws generally affecting the enforcement of creditors’ rights. The
execution, delivery and performance of this Agreement by the Shareholders and
the consummation of the transactions contemplated hereby will not:

 

(a)     violate, conflict with or result in the breach of any of the terms of,
result in a material modification of, otherwise give any other contracting party
the right to terminate, or constitute ( or with notice or lapse of time or both
constitute) a default under, any contract or other agreement to which the
Shareholders are parties or by or to which their or any of their assets or
properties may be bound or subject;

 

(b)     violate any order, judgment, injunction, award or decree of any court,
arbitrator or governmental or regulatory body against, or binding upon,
Shareholders, or upon the properties or business of the Shareholders; or

 

(c)     violate any statute, law or regulation of any jurisdiction applicable to
the transactions contemplated herein which could have a material adverse effect
on the business or operations of the Shareholders.

 

2.2           Litigation. There is no action, suit or proceeding pending or
threatened, or any investigation, at law or in equity, before any arbitrator,
court or other governmental authority, pending or threatened, nor any judgment,
decree, injunction, award or order outstanding, against or in any manner
involving the Shareholders or their properties or rights which (a) could
reasonably be expected to have a material adverse effect on the Shareholders
taken as a whole, or (b) could reasonably be expected to materially and
adversely affect consummation of any of the transactions contemplated by this
Agreement.

 

2.3           Information on Shareholders. The Shareholders are “accredited
investors,” as such term is defined in Regulation D promulgated under the
Securities Act, is experienced in investments and business matters, has made
investments of a speculative nature and, with their representatives, has such
knowledge and experience in financial, tax and other business matters as to
enable them to utilize the information made available by AMCO to evaluate the
merits and risks of and to make an informed investment decision with respect to
this Agreement, which represents a speculative investment. Shareholders are able
to bear the risk of such investment for an indefinite period and to afford a
complete loss thereof.

 

2.4           Investment Intent. Shareholders understands that the AMCO Shares
have not been registered under the Securities Act, that the Exchange commences a
new holding period for the AMCO Shares, and the AMCO Shares, or any shares of
AMCO’s common stock underlying the AMCO Shares, may not be sold, assigned,
pledged, transferred or otherwise disposed of unless the AMCO Shares are
registered under the Securities Act or an exemption from registration is
available. Shareholders represent and warrant that they are acquiring the AMCO
Shares for its own account, for investment, and not with a view to the sale or
distribution of the AMCO Shares except in compliance with the Securities Act.
Each certificate representing the AMCO Shares will have the following or
substantially similar legend thereon:

 

 
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“The securities represented by this certificate have not been registered under
the Securities Act of 1933, as amended (the “Act”) or any state securities laws.
The shares have been acquired for investment and may not be sold or transferred
in the absence of an effective Registration Statement for the shares under the
Act unless, in the opinion of counsel satisfactory to the Company, registration
is not required under the Act or any applicable state securities laws.”

 

2.5           Ownership of Draco Resources Shares. Shareholders are the sole
record and beneficial owners of the Draco Resources Shares, all of which shares
are owned free and clear of all rights, claims, liens and encumbrances, and have
not been sold, pledged, assigned or otherwise transferred except pursuant to
this Agreement. There are no outstanding subscriptions, rights, options,
warrants or other agreements obligating Shareholders to sell or transfer to any
third person any or all of the Draco Resources Shares owned by Shareholders, or
any interest therein. Shareholders have the power to enter into this Agreement
and to carry out their obligations hereunder.

 

2.6           Brokers or Finders. No broker's or finder's fee will be payable by
AMCO in connection with the transaction contemplated by this Agreement, nor will
any such fee be incurred as a result of any actions by AMCO.

 

SECTION 3. REPRESENTATIONS AND WARRANTIES OF DRACO RESOURCES

 

Draco Resources hereby represents and warrants to AMCO as follows:

 

3.1           Organization and Good Standing. Draco Resources is a corporation
duly organized, validly existing and in good standing under the laws of the
State of California, and is entitled to own or lease its properties and to carry
on its business as and in the places where such properties are now owned, leased
or operated and such business is now conducted. Draco Resources is qualified to
do business as a foreign corporation in each jurisdiction, if any, in which its
property or business requires such qualification. Draco Resources has no
subsidiaries.

 

3.2           Authorization; Enforceability; No Breach. Draco Resources has all
necessary corporate power and authority to execute this Agreement and perform
its obligations hereunder. This Agreement constitutes the valid and binding
obligation of Draco Resources enforceable against it in accordance with its
terms, except as may be limited by bankruptcy, moratorium, insolvency or other
similar laws generally affecting the enforcement of creditors’ rights. The
execution, delivery and performance of this Agreement by Draco Resources and the
consummation of the transactions contemplated hereby will not:

 

 
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(a)         violate any provision of the Articles of Incorporation or By-Laws of
Draco Resources;

 

(b)         violate, conflict with or result in the breach of any of the terms
of, result in a material modification of, otherwise give any other contracting
party the right to terminate, or constitute ( or with notice or lapse of time or
both constitute) a default under, any contract or other agreement to which Draco
Resources is a party or by or to which it or any of its assets or properties may
be bound or subject;

 

(c)         violate any order, judgment, injunction, award or decree of any
court, arbitrator or governmental or regulatory body against, or binding upon,
Draco Resources or upon the properties or business of Draco Resources; or

 

(d)         violate any statute, law or regulation of any jurisdiction
applicable to the transactions contemplated herein which could have a material
adverse effect on the business or operations of Draco Resources.

 

3.3           Compliance with Laws. Draco Resources has complied with all
federal, state, county and local laws, ordinances, regulations, inspections,
orders, judgments, injunctions, awards or decrees applicable to it or its
business which, if not complied with, would materially and adversely affect the
business or financial condition of Draco Resources taken as a whole.

 

3.4           Litigation. There is no action, suit or proceeding pending or
threatened, or any investigation, at law or in equity, before any arbitrator,
court or other governmental authority, pending or threatened, nor any judgment,
decree, injunction, award or order outstanding, against or in any manner
involving Draco Resources or its properties or rights which (a) could reasonably
be expected to have a material adverse effect on Draco Resources taken as a
whole, or (b) could reasonably be expected to materially and adversely affect
consummation of any of the transactions contemplated by this Agreement.

 

3.5           Real Estate. The Draco Resources Financial Statements (as
hereinafter defined) set forth all real property owned by Draco Resources and
Draco Resources is the exclusive investor and buyer of an iron stockpile under
contracts (the "Contracts"), true and correct copies of which have been
previously provided to AMCO. The Contracts are valid, binding and enforceable in
accordance with their respective terms, and there does not exist under any such
Contract any default by Draco Resources or, to Draco Resources’ knowledge, of
any event that, with notice or lapse of time or both, would constitute a default
by Draco Resources or, to Draco Resources’ s knowledge, by any other person. All
charges currently due and payable under the Contracts have been paid.

 

3.6           Assets. Draco Resources owns all rights, title and interest in and
to its assets, free and clear of all liens, pledges, mortgages, security
interests, conditional sales contracts or any other encumbrances.

 

3.7           Contracts. Schedule 3.7 sets forth all contracts to which Draco
Resources is a party. Other than as set forth on Schedule 3.7, Draco Resources
is not a party to any contracts, agreements, engagement letters, or other
understandings which bind Draco Resources or its assets.

 

 
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3.8           Financial Statements. Draco Resources has previously delivered to
AMCO Balance sheets at December 31, 2013, 2012 and 2011, Statements of
operations for the year ended December 31, 2013, 2012 and 2011 and for the
period from January 1, 2010 (inception) through December 31, 2013, Statement of
stockholders’ equity for the period from January 1, 2010 (inception) through
December 31, 2013 and Statements of cash flows for the year ended December 31,
2013, 2012 and 2011 and for the period from January 1, 2010 (inception) through
December 31, 2013 (the “Draco Resources Financial Statements”). The Draco
Resources Financial Statements have been prepared in accordance with United
States generally accepted accounting principles (“GAAP”) applied on a consistent
basis during the periods involved.

 

3.9           No Material Adverse Change. Since the date of the Draco Resources
Financial Statements, there has been no material adverse change in the assets,
operations, financial condition or prospects of Draco Resources, taken as a
whole.

 

3.10         Books and Records. The financial records of Draco Resources
accurately reflect in all material respects the information relating to the
business of Draco Resources, the location and collection of its assets, the
nature of all transactions giving rise to the obligations or accounts receivable
of Draco Resources.

 

3.11         Notes Payable; Liabilities. Draco Resources has previously
delivered to AMCO copies of notes payable in the aggregate amount of
$_______0_______ (the “Notes”) to the payees and in the amounts set forth on
Schedule 3.11 hereto. Draco Resources has not suffered or incurred any material
direct or indirect indebtedness, liability, claim, loss, damage, deficiency,
obligation or responsibility, including without limitation, liabilities on
account of taxes, other governmental charges or legal proceedings, nor does
Draco Resources have any liabilities or obligations of any nature, whether or
not accrued, absolute, contingent or otherwise, that would be required by GAAP
to be reflected on a balance sheet of Draco Resources (or in the notes thereto).
(the “Draco Resources Liabilities”) other than (a) as set forth in the Draco
Resources Financial Statements, or (b) previously discharged Draco Resources
Liabilities.

 

3.12         Off Balance Sheet Arrangements. Draco Resources is not a party to,
or has any commitment to become a party to, any joint venture, off-balance sheet
partnership or any similar contract (including any contract or arrangement
relating to any transaction or relationship between or among Draco Resources, on
the one hand, and any unconsolidated affiliate, including any structured
finance, special purpose or limited purpose entity or person, on the other hand,
or any “off-balance-sheet arrangement” (as defined in Item 303(a) of Regulation
S-K under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”))), where the result, purpose or intended effect of such contract is to
avoid disclosure of any material transaction involving, or material liabilities
of, Draco Resources or its affiliates.

 

3.13         Capitalization. The authorized capital stock of Draco Resources
consists of __100,000,000__ shares of common stock of which ___________ shares
are presently issued and outstanding. Such shares of common stock are owned of
record and beneficially by the Shareholders. Draco Resources has not granted,
issued or agreed to grant, issue or make available any warrants, options,
subscription rights or any other commitments of any character relating to the
unissued shares of capital stock of Draco Resources. All of the Draco Resources
Shares are duly authorized and validly issued, fully paid and non-assessable.

 

 
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3.14         Taxes. All required tax returns or federal, state, county,
municipal, local, foreign and other taxes and assessments have been properly
prepared and filed by Draco Resources for all years for which such returns are
due unless an extension for filing any such return has been properly prepared
and filed. Any and all federal, state, county, municipal, local, foreign and
other taxes, assessments, including any and all interest, penalties and
additions imposed with respect to such amounts have been paid or provided for.
Draco Resources has no outstanding tax liabilities and has not received notice
of any tax inquiry or audit against it.

 

3.15         Actions and Proceedings. There is no outstanding order, judgment,
injunction, award or decree of any court, governmental or regulatory body or
arbitration tribunal against or involving Draco Resources. There is no action,
suit or claim or legal, administrative or arbitral proceeding or (whether or not
the defense thereof or liabilities in respect thereof are covered by insurance)
pending or threatened against or involving Draco Resources or any of its
properties or assets. There is no fact, event or circumstances that may give
rise to any suit, action, claim, investigation or proceeding

 

3.16         Full Disclosure. No representation or warranty by Draco Resources
in this Agreement or in any document or schedule to be delivered by them
pursuant hereto, and no written statement, certificate or instrument furnished
or to be furnished to AMCO pursuant hereto or in connection with the
negotiation, execution or performance of this Agreement contains, or will
contain, any untrue statement of a material fact or omits, or will omit, to
state any fact necessary to make any statement herein or therein not materially
misleading or necessary to a complete and correct presentation of all material
aspects of the businesses of Draco Resources.

 

3.17         Brokers or Finders. Draco Resources acknowledges and agrees to pay
to China Direct Investments, Inc and its designees 600,000 shares of AMCO common
stock and pay to Shanghai Heqi Investment Center (Limited Partner) and its
designees 600,000 shares of AMCO common stock in connection with the transaction
contemplated by this Agreement as Finder's fee. (the "Finder's Fee"). The
Finder's Fee is part of 13,950,000 shares of AMCO common stock that the
Shareholders receive by this Agreement.

  

SECTION 4. REPRESENTATIONS AND WARRANTS OF AMCO

 

AMCO represent and warrants to Shareholders and Draco Resources as follows:

 

4.1           Organization and Good Standing. AMCO is a corporation duly
organized, validly existing and in good standing under the laws of California,
and is entitled to own or lease its properties and to carry on its business as
and in the places where such properties are now owned, leased or operated and
such business is now conducted. AMCO is qualified to do business as a foreign
corporation in each jurisdiction, if any, in which its property or business
requires such qualification. AMCO’s subsidiaries, and its ownership interest in
each, are set forth in its AMCO SEC Documents (as hereinafter defined).

 

 
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4.2           Authorization; Enforceability; No Breach. AMCO has all necessary
corporate power and authority to execute this Agreement and perform its
obligations hereunder. This Agreement constitutes the valid and binding
obligation of AMCO enforceable against it in accordance with its terms, except
as may be limited by bankruptcy, moratorium, insolvency or other similar laws
generally affecting the enforcement of creditors’ rights. The execution,
delivery and performance of this Agreement by AMCO and the consummation of the
transactions contemplated hereby will not:

 

(a)         violate any provision of the Articles of Incorporation or By-Laws of
AMCO;

 

(b)         violate, conflict with or result in the breach of any of the terms
of, result in a material modification of, otherwise give any other contracting
party the right to terminate, or constitute ( or with notice or lapse of time or
both constitute) a default under, any contract or other agreement to which AMCO
is a party or by or to which it or any of its assets or properties may be bound
or subject;

 

(c)         violate any order, judgment, injunction, award or decree of any
court, arbitrator or governmental or regulatory body against, or binding upon,
Draco Resources, or upon the properties or business of AMCO;

 

(d)         violate any statute, law or regulation of any jurisdiction
applicable to the transactions contemplated herein which could have a material
adverse effect on the business or operations of AMCO.

 

4.3           The AMCO Securities. The AMCO Securities to be issued to the
Shareholders have been, or on or prior to the Closing will have been, duly
authorized by all necessary corporate and Shareholders actions and, when so
issued in accordance with the terms of this Agreement, will be validly issued,
fully paid and non-assessable and will not be issued in violation of the
pre-emptive or similar rights of any person.

 

4.4           AMCO Financial Statements and SEC Documents. AMCO’s audited
balance sheets at December 31, 2013 and 2012, and the related statements of
operations and shareholders’ equity for each the two fiscal years then ended
(collectively, the “AMCO Financial Statements”) have been filed by AMCO with the
Securities and Exchange Commission (“SEC”) and are available on the SEC’s
website at www.sec.gov. The AMCO Financial Statements have been prepared in
accordance with GAAP. AMCO has filed or furnished all forms, documents and
reports required to be filed or furnished by it with the SEC since _____June 27,
2008_____ (the “AMCO SEC Documents”). As of their respective dates or, if
amended, as of the date of such amendment, the AMCO SEC Documents complied in
all material respects with the requirements of the Securities Act, the Exchange
Act and the Sarbanes-Oxley Act of 2002, as the case may be, and the applicable
rules and regulations promulgated thereunder, and none of the AMCO SEC Documents
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. As of the date of this Agreement, there are no outstanding or
unresolved comments in comment letters received by AMCO from the SEC or its
staff. There has been no material correspondence between the SEC and AMCO since
______ June 27, 2008_______ that is not available on the SEC’s Electronic Data
Gathering and Retrieval database. Except (a) as reflected or reserved against in
AMCO’s most recent unaudited balance sheets (or stated in the notes thereto) at
______September 30, 2013______ included in the AMCO SEC Documents and (b) for
liabilities and obligations incurred since ____June 27, 2008____ in the ordinary
course of business consistent with past practice (the “AMCO Liabilities”), and
AMCO does not have any liabilities or obligations of any nature, whether or not
accrued, absolute, contingent or otherwise, that would be required by GAAP to be
reflected on a balance sheet of AMCO (or in the notes thereto).

 

 
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4.5           No Material Adverse Changes. Since the date of the AMCO Financial
Statements, there has been no material adverse change in the assets, operations,
financial condition or prospects of AMCO, taken as a whole.

 

4.6           Compliance with Laws. AMCO has complied with all federal, state,
county and local laws, ordinances, regulations, inspections, orders, judgments,
injunctions, awards or decrees applicable to it or its business which, if not
complied with, would materially and adversely affect the business or financial
condition of AMCO.

 

4.7           Litigation. There is no action, suit or proceeding pending or
threatened, or any investigation, at law or in equity, before any arbitrator,
court or other governmental authority, pending or threatened, nor any judgment,
decree, injunction, award or order outstanding, against or in any manner
involving AMCO or any of AMCO's properties or rights which (a) could reasonably
be expected to have a material adverse effect on AMCO taken as a whole, or (b)
could reasonably be expected to materially and adversely affect consummation of
any of the transactions contemplated by this Agreement.

 

4.8           Capitalization. The authorized capital stock of AMCO consists of
(i) 74,000,000 shares of common stock, of which there are presently issued and
outstanding the number of shares of common stock set forth on Schedule 4.8..
AMCO has not granted, issued or agreed to grant, issue or make available any
warrants, options, subscription rights or any other commitments of any character
relating to the unissued shares of capital stock of AMCO except as set forth in
the AMCO SEC Documents. All of the issued and outstanding capital stock of AMCO
has been duly authorized and validly issued, fully paid and non-assessable, and
was issued in compliance with applicable securities laws.

 

4.9           Taxes. All required tax returns or federal, state, county,
municipal, local, foreign and other taxes and assessments have been properly
prepared and filed by AMCO for all years for which such returns are due unless
an extension for filing any such return has been properly prepared and filed.
Any and all federal, state, county, municipal, local, foreign and other taxes,
assessments, including any and all interest, penalties and additions imposed
with respect to such amounts have been paid or provided for. AMCO has no
outstanding tax liabilities and has not received notice of any tax inquiry or
audit against it.

 

 
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4.10         Full Disclosure. No representation or warranty by AMCO in this
Agreement or in any document or schedule to be delivered by them pursuant
hereto, and no written statement, certificate or instrument furnished or to be
furnished to AMCO pursuant hereto or in connection with the negotiation,
execution or performance of this Agreement contains, or will contain, any untrue
statement of a material fact or omits, or will omit, to state any fact necessary
to make any statement herein or therein not materially misleading or necessary
to a complete and correct presentation of all material aspects of the businesses
of AMCO.

 

4.11         Brokers or Finders. No broker's or finder's fee will be payable by
AMCO in connection with the transaction contemplated by this Agreement, nor will
any such fee be incurred as a result of any actions by AMCO.

 

SECTION 5. COVENANTS

 

5.1           Examinations and Investigations. Prior to the Closing Date, the
parties acknowledge that they have been entitled, through their employees and
representatives, to make such investigation and verification of the assets,
properties, business and operations, books, records and financial condition of
the other, including communications with suppliers, vendors and customers, as
they each may reasonably require. No investigation by a party hereto shall,
however, diminish or waiver in any way any of the representations, warranties,
covenants or agreements of the other party under this Agreement. Consummation of
this Agreement shall be subject to the fulfillment of due diligence procedures
to the reasonable satisfaction of each of the parties hereto and their
respective counsel.

 

5.2           Expenses. Each party hereto agrees to pay its own costs and
expenses incurred in negotiating this Agreement and consummating the
transactions described herein.

 

5.3           Further Assurances. The parties shall execute such documents and
other papers and take such further action as may be reasonably required or
desirable to carry out the provisions hereof and the transactions contemplated
hereby. Each such party shall use its best efforts to fulfill or obtain in the
fulfillment of the conditions to the Closing, including, without limitation, the
execution and delivery of any documents or other papers, the execution and
delivery of which are necessary or appropriate to the Closing.

 

5.4           Confidentiality. In the event the transactions contemplated by
this Agreement are not consummated, each of the parties hereto agree to keep
confidential any information disclosed to each other in connection therewith;
provided, however, such obligation shall not apply to information which:

 

(a)         at the time of disclosure was public knowledge;

 

 
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(b)         after the time of disclosure becomes public knowledge (except due to
the action of the receiving party); or

 

(c)          the receiving party had within its possession at the time of
disclosure.

 

5.5           Stock Certificates and Consideration. At the Closing, the
Shareholders shall have delivered the certificates representing the Draco
Resources Shares duly endorsed (or with executed stock powers) so as to make
AMCO the sole owner thereof. At such Closing, AMCO shall issue to the
Shareholders the AMCO Shares as provided herein.

 

5.6           No Change to Capitalization. From the date hereof and continuing
to the Closing Date, neither AMCO nor Draco Resources shall issue any shares of
capital stock or any securities convertible into capital stock, or enter into
any agreement to do so.

 

SECTION 6. THE CLOSING

 

The Closing shall take at a time and place mutually agreed upon by AMCO, Draco
Resources and the Shareholders following satisfaction or waiver of all
conditions precedent to Closing (the “Closing”). At the Closing, the parties
shall provide each other with such documents as may be necessary or appropriate
and customary in transactions of this sort in order to consummate the
transactions contemplated hereby, including evidence of due authorization of the
Agreement and the transactions contemplated hereby. AMCO will seek its
shareholder approval for such exchange by this Agreement.

 

SECTION 7. CONDITIONS PRECEDENT TO CLOSING

 

7.1           Conditions Precedent to the Obligation of AMCO to Issue the AMCO
Shares. The obligation of AMCO to issue the AMCO Shares to the Shareholders and
to otherwise consummate the transactions contemplated hereby is subject to the
satisfaction, at or before the Closing, of each of the conditions set forth
below. These conditions are for AMCO's sole benefit and may be waived by AMCO at
any time in its sole discretion.

 

(a)         The representations and warranties of Draco Resources and the
Shareholders will be true and correct in all material respects as of the date
when made and as of the Closing Date, as though made at that time;

 

(b)         Draco Resources and the Shareholders shall have performed all
agreements and satisfied all conditions required to be performed or satisfied by
them at or prior to the Closing;

 

(c)         No statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by any
court or governmental authority of competent jurisdiction which prohibits the
consummation of any of the transactions contemplated by this Agreement;

 

 
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(d)         There shall have been no adverse effect on the business, operations,
properties, prospects or financial condition of Draco Resources that is material
and adverse to Draco Resources, taken as a whole;

 

(e)         The Shareholders shall have delivered to AMCO the certificate(s)
representing the Draco Resources Shares, duly endorsed for transfer (or with
executed stock power(s);

 

(f)         The Shareholders shall have delivered the books and records of Draco
Resources to AMCO; and

 

(g)         Draco Resources and the Shareholders shall have delivered to AMCO
such other documents relating to the transactions contemplated by this Agreement
as AMCO may reasonably request.

 

7.2           Conditions Precedent to the Obligation of the Shareholders to
Exchange Its Draco Resources Shares. The obligation of the Shareholders to
exchange its Draco Resources Shares for the AMCO Shares and to otherwise
consummate the transactions contemplated hereby is subject to the satisfaction,
at or before the Closing, of each of the conditions set forth below. These
conditions are for the Shareholders’ sole benefit and may be waived by the
Shareholders at any time in its sole discretion.

 

(a)         The representations and warranties of AMCO will be true and correct
in all material respects as of the date when made and as of the Closing Date, as
though made at that time;

 

(b)         AMCO shall have performed all agreements and satisfied all
conditions required to be performed or satisfied by it at or prior to the
Closing;

 

(c)         AMCO shall revise its by-laws as may be required and appoint as
directors four persons designated by the Shareholders;

 

(d)         No statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by any
court or governmental authority of competent jurisdiction which prohibits the
consummation of any of the transactions contemplated by this Agreement;

 

(e)         There shall have been no adverse effect on the business, operations,
properties, prospects or financial condition of AMCO that is material and
adverse to AMCO, taken as a whole. AMCO shall have timely filed its Annual
Report on Form 10-K for the year ended December 31, 2013 with the SEC, which
such report shall have been prepared in conformity with the rules and
regulations of the SEC and shall contain the unqualified audit report of AMCO’s
independent registered public accounting firm on its financial statements
contained therein;

 

 
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(f)         AMCO shall have filed an amendment to its Articles of Incorporation
in the form attached hereto as Exhibit A designating the Common Shares;

 

(g)         AMCO’s common stock shall be quoted on the New York Stock Exchange;

 

(h)         AMCO shall have delivered the AMCO Shares to the Shareholders;

 

(i)          AMCO shall have delivered to the Shareholders such other documents
relating to the transactions contemplated by this Agreement as the Shareholders
may reasonably request.

 

SECTION 8. SURVIVAL OF REPRESENTATIONS AND WARRANTIES OF AMCO

 

Notwithstanding any right of the Shareholders fully to investigate the affairs
of AMCO, the Shareholders shall have the right to rely fully upon the
representations, warranties, covenants and agreements of contained in this
Agreement or in any document delivered by AMCO or any of its representatives, in
connection with the transactions contemplated by this Agreement. All such
representations, warranties, covenants and agreements shall survive the
execution and delivery hereof and the Closing Date hereunder for 12 months
following the Closing.

 

SECTION 9. SURVIVAL OF REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS

 

Notwithstanding any right of AMCO fully to investigate the affairs of Draco
Resources, AMCO has the right to rely fully upon the representations,
warranties, covenants and agreements of Draco Resources and the Shareholders
contained in this Agreement or in any document delivered to AMCO by either
entity or any of its respective representatives, in connection with the
transactions contemplated by this Agreement. All such representations,
warranties, covenants and agreements shall survive the execution and delivery
hereof and the Closing Date hereunder for 12 months following the Closing.

 

SECTION 10. INDEMNIFICATION

 

10.1         Obligation of AMCO to Indemnify. Subject to the limitations on the
survival of representations and warranties contained in Section 9, AMCO hereby
agrees to indemnify, defend and hold harmless the Shareholders from and against
any losses, liabilities, damages, deficiencies, costs or expenses (including
interest, penalties and reasonable attorneys’ fees and disbursements) (a “Loss”)
based upon, arising out of, or otherwise due to any inaccuracy in or any breach
of any representation, warranty, covenant or agreement of AMCO contained in this
Agreement or in any document or other writing delivered pursuant to this
Agreement.

 

10.2         Obligation of the Shareholders to Indemnify. Subject to the
limitations on the survival of representations and warranties contained in
Section 8, the Shareholders agrees to indemnify, defend and hold harmless AMCO
to the extent provided for herein from and against any Loss based upon, arising
out of, or otherwise due to any inaccuracy in or any breach of any
representation, warranty, covenant or agreement made by any of them and
contained in this Agreement or in any document or other writing delivered
pursuant to this Agreement.

 

 
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SECTION 11. MISCELLANEOUS

 

11.1         Waivers. The waiver of a breach of this Agreement or the failure of
any party hereto to exercise any right under this agreement shall in no event
constitute waiver as to any future breach whether similar or dissimilar in
nature or as to the exercise of any further right under this Agreement.

 

11.2         Amendment. This Agreement may be amended or modified only by an
instrument of equal formality signed by the parties or the duly authorized
representatives of the respective parties.

 

11.3         Binding Agreement; Assignment. This Agreement shall be binding upon
the parties hereto and their respective heirs, legal representatives, successors
and permitted assigns. This Agreement is not assignable except by operation of
law.

 

11.4         Notices. Until otherwise specified in writing, the mailing
addresses of both parties of this Agreement shall be as follows:

 

The Shareholders: 

1065 E. Hillsdale Blvd., Suite 318

 

Foster City, CA 94406

 

 

Draco Resources:

1065 E. Hillsdale Blvd., Suite 315

 

Foster City, CA 94406

 

 

AMCO:

One waters park drive, Suite 98

 

San Mateo CA 94403

 

 

with a copy to: AMCO’s registered agent as reflect in the public records of the
Secretary of State of Nevada

  

Any notice or statement given under this Agreement shall be deemed to have been
given if sent by certified mail, return receipt requested, overnight courier or
personal delivery, to the other party(ies) at the addresses indicated above or
at such other address or number as may be furnished in writing in accordance
with this paragraph.

 

11.5         Governing Law; Venue. This Agreement shall be governed and
construed in accordance with the laws of the State of California, without regard
to the conflicts of law provisions thereof. Each party hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in
the County of ____San Mateo____, State of California, for the adjudication of
any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and
agrees not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such suit, action
or proceeding is brought in an inconvenient forum or that the venue of such
suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this agreement and agrees that such service
shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. If any provision of this agreement shall
be invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this agreement in that jurisdiction or the validity or
enforceability of any provision of this agreement in any other jurisdiction.
EACH PARTY HERETO IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY.

 

 
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11.6         Publicity. No publicity release or announcement concerning this
Agreement or the transactions contemplated hereby shall be issued by either
party hereto at any time from the signing hereof without advance approval in
writing of the form and substance thereof by the other party.

 

11.7         Entire Agreement. This Agreement (including the Exhibits and
Schedules hereto) contains the entire agreement among the parties with respect
to the purchase and issuance of the Draco Resources Shares and the AMCO Shares
and related transactions, and supersede all prior agreements, written or oral,
with respect thereto.

 

11.8         Headings. The headings in this Agreement are for reference purposes
only and shall not in any way affect the meaning or interpretation of this
Agreement.

 

11.9         Severability of Provisions. The invalidity or unenforceability of
any term, phrase, clause, paragraph, restriction, covenant, agreement or other
provision of this Agreement shall in no way affect the validity or enforcement
of any other provision or any part thereof.

 

11.10       Counterparts; Facsimile. This Agreement may be executed in any
number of counterparts, each of which, when so executed, shall constitute an
original copy hereof, but all of which together shall consider but one and the
same document. This Agreement may be executed and delivered by facsimile
transmission and when so executed and delivered shall have the same effect as if
the receiving party had received an original counterpart of this Agreement.

 

 
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date first
above written.

 

 

 

 

ARMCO METALS HOLDINGS, INC.

 

 

 

 

 

 

 

 

 

 

By:

 

 

    Kexuan Yao,       Chief Executive Officer  

 

 

 

 

DRACO RESOURCES, INC.

 

 

 

 

 

 

 

 

 

 

By:

 

 

    Songqiang Chen

,       Chief Executive Officer  

 

 
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DRACO RESOURCES, INC. SHAREHOLDERS

 

Shareholder's Name

Ownership%

Songqiang Chen

39.6424%

5,054,400(   AMCO shares)

Jian Fang

13.7255%

1,750,000(   AMCO shares)

Changli Yan

12.5490%

1,600,000( AMCO shares)

Hongye Chen

11.7647%

1,500,000(   AMCO shares)

Fajie Wang

11.7647%

1,500,000(   AMCO shares)

Honglin Zhang

4.8941%

624,000(   AMCO shares)

Tong Huang

4.4047%

561,600(   AMCO shares)

Hongbing Lin

1.2549%

160,000(   AMCO shares)

 

 

Total AMCO shares: 12,750,000

 

 

 

INDEX OF EXHIBITS AND SCHEDULES

 

 

Exhibit A

Articles of Amendment to the Articles of Incorporation of AMCO Corporation
containing the designations, rights and preferences of the Common Stock

 

Schedule 3.7

Draco Resources Contracts

 

Schedule 3.11

Draco Resources Notes

    Schedule 4.8 AMCO Corporation listing of the outstanding and issued common
stock as of         April 15, 2014       

 

 

 

 

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