Equipment procurement contract

 

Buyer: China Great Wall Industry Co. Ltd.

 

(中国长城工业集团有限公司)

 

Seller: CER Energy Recovery (Yangzhou) Co. Ltd.

 

(中江能源回收（扬州）有限公司)

 

Contract Number: 12GWITC-CG001

 

Signed Date: 2012-8-9

 

Signed place: Beijing

 

 

 

 

This contract is entered into by the below parties on August 09, 2012.

Seller: CER Energy Recovery (Yangzhou) Co. Ltd.

Address: No.100 Zhongjiang Road Automobile Industrial Park, Yizheng City,
Jiangsu Province, China.

 

Buyer: China Great Wall Industry Co. Ltd.

Address: No. 88 Nancaiyuan Street Xicheng district, Beijing

 

Pursuant to “Contract Law of The People’s Republic of China” and related
regulations, upon fully and friendly negotiated based on equality and free will
between the two parties, both parties hereto agree as follows:

 

1.Definition :

“Contract” means this HRS Equipment Purchase Contract signed between the Buyer
and the Seller, including all appendices.

 

“Total Price” means the sum price payable from the Buyer to the Seller under the
Contract for the performance of its contractual obligations as given in Article
4.

 

“Product” and “Products” mean Seller’s proprietary HRS equipment, machinery,
instruments, spare parts, tools, and other materials as described in contract
which Buyer shall purchase from Seller under the terms and conditions of this
Contract.

 

“Technical Documents” means all the technical drawings and documents issued by
Seller in accordance.

 

“Effective Date of Contract” means the signature date of the Contract as set
forth hereunder.

 

2.Product name, quantity and specification

 

Item  Product Name  Quantity   Unit Price   Price(RMB)  1  HRS boiler with steam
drum   2    3,266,567.79    6,533,135.58  2  HRS boiler auxiliaries   2  
 858,599.29    1,717,198.58  3  HRS mist eliminators   2    2,489,762.04  
 4,979,524.08  4  HRS 1-stage distributor   2    2,776,461.91    5,552,923.82 
5  HRS heater   2    1,963,355.21    3,926,710.42  6  HRS dilutor   2  
 2,771,758.70    5,543,517.40  7  HRS process analyzers   2    517,353.15  
 1,034,706.30  8  Lubrite Slide Plates   2    47,639.60    95,279.20  9  Steam
Injection Chamber   2    344,902.10    689,804.20  10  Steam Injection Chamber 
 2    1,190,990.07    2,381,980.14 

 

 

 

 

3.Contract Price

The Total Price of the Contract shall be RMB 32,454,779.72 (SAY RMB thirty two
million four hundred fifty four thousand seven hundred and seventy nine point
seven two).

The itemized unit price of this contract shall specify in this contract.

 

4.Payment Terms and Payment Schedule

 

4.1Prepayment

The Buyer shall issue the irrevocable Letter of Credit in favor of the Seller
within 15 calendar days from signature date of this contract, and the amount of
L/C is RMB 10 million.

The Seller shall issue the corresponding amount of invoice of value added tax to
the Buyer.

 

4.2Progress payment

The Buyer shall issue the irrevocable Letter of Credit in favor of the Seller
within 45 calendar days from signature date of this contract, and the amount of
L/C is RMB 20 million.

The Seller shall issue the corresponding amount of invoice of value added tax to
the Buyer and simultaneously provide the delivery order issued by carrier.

 

4.3Delivery payment

The Buyer or designated party shall make the inspection and acceptance during
delivery. When the Seller completes the installation and test as well as signed
confirmation by two parties, within 30 calendar days from progress payment date,
the Buyer shall make the delivery payment to the Seller via T/T, in the amount
of RMB 2,454,779.72.

 

Seller’s bank details are as follows:

Company name: CER energy recovery (Yangzhou) Co. Ltd.

Account Bank: Bank of China, Yizheng branch

Account Number: 511858204774

 

5.Shipment and Delivery

 

5.1Deliver the equipments via land carriage under this contract.

5.2The Seller shall deliver the equipments to designated place within 60
calendar days from the signature date of this contract.

5.3The Seller shall be responsible for the installation and test. The security
management and responsibilities of security incidents shall be assumed by the
Seller during test.

 

 

 

 

6.Quality Warranty

Subject to the Limitations of Article 9 and except as otherwise provided herein,
Seller warrants title to the Products sold hereunder:

 

(1)In respect to the products, the Seller warrants, which are not subject to any
encumbrance, and that they shall conform to Seller's specifications there for,
and do not infringe upon the third party's intellectual property.

(2)Seller further warrants that the Products will be free from defects due to
materials or workmanship until the expiration of the earlier of twelve (12)
months from the date that acid is first introduced into the HRS Plant. If,
within thirty (30) days after Buyer's discovery of any such defects, and, in any
event, prior to the expiration of the Warranty Period, Buyer shall notify Seller
thereof in writing, Seller shall, at its option promptly repair or replace, that
portion of the Products found by Seller to be defective.

(3)During the Warranty Period, the equipment and/or materials to be
supplied under Seller's warranty obligations, which is for repairing and/or
replacing any defective items of the Products attributable to Seller’s faults,
the Seller shall assume the expense of providing the equipment and/or materials
during the range of warranty.

 

7.Settlement Ways of Quality Assurance

If Buyer finds defective items as specified in article 6, the Seller shall
assume the corresponding responsibility.

The Seller has rights to address the quality assurance compensation event by the
ways of following:

 

(1)Devalue the Products according to the degree of inferiority, extent of damage
and amount of losses suffered by the Buyer.

(2)Repair or replace if needed, the defective Products partly or wholly with new
parts, components or equipment which conforms to the specifications and quality
as stipulated in this Contract. Buyer shall be responsible for the removal /
installation costs.

 

8.Inspection

 

8.1 Before delivery, the Seller shall inspect the goods, issuing the inspection
report and signing on it.

8.2 When delivery, the Buyer or Principal shall inspect the goods according to
delivery list provided by the Seller.

8.3 When open-package inspecting, both parties shall confirm by signatures in
respect to products’ quantity, model and external packing, if any dissent, both
parties shall sign to confirm on the spot.

8.4 After the Seller completing the installation and test in accordance with the
Buyer and this contract, both parties shall sign to confirm for the result of
installation and test, if any dissent, both parties shall sign to confirm on the
spot.

 

 

 

 

9.Default Responsibilities

 

9.1If fails to make the payment before the maturity date as stipulated in this
contract, the Buyer will assume the default responsibilities. In addition, the
Seller still can charge an interest fee to Buyer, carrying a daily interest rate
of 0.01% from the due date to actual payment date upon unpaid amount, but shall
in no event exceed 5% of unpaid amount.

9.2If fails to deliver the goods before the maturity date as stipulated in this
contract, the Seller shall assume the corresponding default responsibilities. In
addition, the Buyer still can charge an interest fee to Seller, carrying a daily
interest rate of 0.01% from the stipulated delivery date to actual delivery
date, but shall in no event exceed 5% of the amount of undelivered equipment.

 

10.Limitation of Liabilities

Seller’s aggregate total liability for any and all losses and damages arising
out of any cause whatsoever shall in no event exceed the total contract price as
listed in article 3.

 

11.Force Majeure

Where circumstances, which are beyond either Party’s reasonable control, cause
delay in or failure of a Party’s performance of its obligations pursuant to this
Contract, such Party shall not be considered in breach of this Contract or be
liable to the other Party, and the term of implementation of such Party’s
respective obligation may be extended accordingly. The aforementioned
circumstances include, but shall not be limited to such cases which will affect
the contract execution as natural disaster, war, unrest, fire, explosion, flood,
strikes, port congestion, epidemic, enactment of new laws and acts of the
government. When one party fails to perform or incompletely perform the
obligations under this contract due to force majeure, shall inform the counter
party of this contract within 15 calendar days from the date of force majeure
occurred, and provided the corresponding evidence within 60 days. If one party
fails to perform the obligations arising from force majeure, the involved party
will be partly or fully exempted from liabilities, except as otherwise provided
by law.

 

12.Disputes resolution

All disputes arising from the execution, performance or termination of or in
connection with this Contract shall be settled amicably through friendly
negotiation. In case no settlement can be reached through negotiation, the case
shall then be finally resolved by submitting to China International Trading
Arbitration Commission. The arbitration shall take place in Beijing and be
conducted in Chinese language according to its procedures and rules of China
International Trading Arbitration Commission and the law of the arbitration
shall be the laws of China.

 

13.Others

The Contract is executed with four originals, two of which is held by Buyer and
Seller, respectively. This Contract is effective from the date on which the sign
and stamp.

 

 

 

 

( Signature page, no text )

 

Seller:

 

CER Energy Recovery (Yangzhou) Co., Ltd  ( Stamp )

 

The legal representative (authorized representative)

 

Buyer: China Great Wall Industry Co. Ltd. ( Stamp ) 

 

The legal representative (authorized representative)