Exhibit 10.11

 

Confidentiality

  

[Translation]

 

Sanhe Xiangtian Power Engineering Co., Ltd.

 

Equity Transfer Agreement

 

This Equity Transfer Agreement (“this Agreement”) is signed by the following
parties on September 30, 2018.

 

Party A (“transferee”): Xianning Sanhe Xiangtian Power Equipment Manufacturing
Co., Ltd., a limited liability company established and validly existing under
the laws of the People’s Republic of China, located at Fuqiao Village,
Henggouqiao Town, Xianning City.

 

Party B (“Transferor”):

Zhou Jian, ID card number: [   ]

Zhou Dengrong, ID card number: [   ]

 

The aforementioned parties will be referenced to “one party” individually and
“the parties” jointly herein.

 

Whereas:

 

1)Sanhe Xiangtian Power Engineering Co., Ltd. (hereinafter referred to as
“Company”) is a company incorporated in Sanhe City with a registered capital of
RMB 60 million. Party B holds 100% of the company’s equity.

 

2)Party B is the shareholder of Party A and holds 100% of the equity of Party A.
At the same time, Party B is the sole shareholder of the Company, and Party B
intends to transfer 100% of the shares of the Company it holds to Party A.

 

3)After friendly negotiation, the parties reached this agreement on the basis of
equal negotiation on Party B transferring of Company equity to Party A according
to the Contract Law of the People’s Republic of China and the Company Law of the
People’s Republic of China.

 

1.Equity transfer

 

1.1Party B agrees to transfer 100% of the shares of the Company it holds
(hereinafter referred to as “target equity”) to Party A at a price of [   ]
million, and Party A agrees to accept the subject shares in accordance with the
terms and conditions of this Agreement.

 

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1.2Party A shall pay the equity transfer amount of the underlying equity [   ]
million yuan (“Equity Transfer Payment”) to the following accounts of Party B in
accordance with the provisions of this Agreement:

Account Name: [   ]

Bank: [   ]

Account Number: [   ]

 

1.3Party B confirms and jointly guarantees that the shares of the Company
currently held by Party B are actually held by the company, and there is no
entrusted shareholding or trust holding on the shares, and no mortgage, pledge
or any rights are restricted. After the completion of the equity transfer, the
company’s shareholding structure was changed to:

 

No.  Name of shareholder  Investment Amount (Ten Thousand Yuan)   Proportion  1 
Zhou Jian        97% 2  Zhou Dengrong        3% Total      30000    100%

 

1.4The transfer of the underlying equity is completed from the date of
completion of the industrial and commercial registration. From the date of
completion of the equity transfer, Party A becomes the actual holder of the
underlying equity, and enjoys the shareholder rights of the underlying equity in
accordance with the terms of this agreement and shall perform the corresponding
shareholder obligations.

 

2.Handover procedures

 

2.1After Party A has paid the equity transfer payment in accordance with the
provisions of this agreement, the Company shall handle the relevant procedures
for industrial and commercial registration, issue the corresponding register of
shareholders and other handovers in accordance with the following procedures,
and Party B shall ensure that the company handles the above procedures in
accordance with the following procedures:

 

2.2Party B and the company shall, within five working days after Party A pays
the equity transfer payment in accordance with the agreement of this agreement,
apply to the industrial and commercial administration department for the
relevant registration and ensure that registration are completed within 20
working days after Party A pays the equity transfer payment; a copy of the new
business license and the company’s articles of association (or amendments to the
articles of association) will be provided to Party A within 20 working days
after the completion of the industrial and commercial registration;

 

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2.3Within five working days after Party A’s payment of the equity transfer
payment, the Company shall issue to Party A the register of shareholders affixed
with the Company’s official seal. The register of shareholders shall record the
name of the Company, the name of Party A, the proportion of shares and the date
of issuance;

 

2.4Within five working days after the above-mentioned Party A pays the equity
transfer payment, the Company shall hand over the Company’s official seal,
financial account, customer information, original copy of the Company’s license,
employee’s register, all contracts and other Company information to Party A;

 

3.The company’s obligations during the transition period

 

3.1After signing of this Agreement and before the completion of the equity
transfer (completed registration of industrial and commercial registration),
without the consent of Party A, Party B and the Company shall not conduct any
disposition of their equity, including but not limited to pledge, transfer,
donation, waiver and any act of placing any third party rights on the target
equity, unless otherwise agreed in this Agreement.

 

3.2Party B and the Company shall ensure that there are no major sales, pledges
and losses of the company’s assets, resulting in any third party making a major
claim.

 

4.Major events during the transition period

 

After the signing of this agreement, Party B and the company shall not engage in
the following activities until the completion of the equity transfer, the
revision of the company’s articles of association, the equity transfer, and the
completion of the change of the board of supervisors and board of directors,
unless otherwise expressly agreed in this Agreement or disclosed to Party A in
advance.

 

4.1Amend or otherwise change the company’s organizational documents (including
but not limited to the company’s articles of association, the rules of procedure
of the board of supervisors and the board of directors, etc., except for matters
related to this transfer of equity in accordance with the documents signed by
the parties);

 

4.2Conduct any form of merger, division, reorganization or other act that
affects the legal existence or normal operation of the company; without the
consent of Party A or this agreement, change the registered capital or share
capital, or make any act or matter sufficient to cause such change, sign or
conduct any agreement or arrangement sufficient to cause such change;

 

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4.3Increase or decrease of company assets or property rights, except in normal
business processes consistent with past practices, such as the sale of
inventory, equipment or facility maintenance, maintenance, etc., other than
normal business activities;

 

4.4Significantly increase the remuneration, bonus distribution, profit sharing,
social insurance scheme, commercial insurance scheme or other benefit
distribution paid to the company’s directors, officers or employees, unless in
accordance with past practice or company’s existing policies and regulations;

 

4.5Allocating the company’s profits;

 

4.6Change the company’s accounting practices, methods or assumptions reflected
therein, or change the company’s financial or accounting system;

 

4.7Equity investment in any other company, economic entity, whether
holding/controlling the company or the economic entity; providing loans or
guarantees, transfer payments or donations to any third party;

 

4.8To enter into any transaction or arrangement with its related parties, or to
cause any such transaction or arrangement to take effect, but to carry out the
necessary operations of the company in accordance with the original business
operation and substantially the same terms at the time of the conclusion of this
Agreement (or before);

 

4.9Amend, terminate, revoke or waive any major claims of the Company against any
third party, or reach a settlement with them; waive, waive or settle any
material civil or administrative litigation, arbitration or dispute;

 

4.10Transfer, license, guarantee or pledge, waiver, set options, pending rights
or otherwise dispose of intellectual property rights that are important to the
company’s business;

 

4.11Invalidate any government approvals such as licenses, approvals, and
qualifications related to its business or products.

 

If Party B and the company fail to complete any of the matters stipulated in
Articles 4 and 5 of this Agreement, Party A has the right to terminate the
execution of this Agreement by written notice. If Party A loses, Party A has the
right to request the company to provide Corresponding compensation.

 

5.Agreement after equity transfer

 

The parties unanimously agree and confirm that Party A will enjoy all
shareholder rights and assume shareholder obligations in accordance with the
company’s articles of association, after the completion of Party A’s articles of
association, shareholder register or equity transfer business registration
procedures, including but not limited to: enjoying the share of the company’s
shareholding profits; participating in the company’s shareholders meeting and
exercising voting rights according to the share of the shares held; proposing to
convene a shareholders’ meeting to the company’s board of directors; supervising
the company’s business conduct, making recommendations or inquiring , review and
copy the company’s articles of association, shareholders’ meeting or board
meeting minutes, financial accounts, evaluation reports, company shareholding
structure and other information; participation in the company’s remaining
property distribution; other laws and company charters confer rights to
shareholders.

 

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6.Statements, commitments and warranties of the parties

 

6.1Each party has and has the necessary rights and authority to sign this
Agreement and perform its obligations under this Agreement. Signing and
fulfilling this Agreement does not violate laws, regulations and any other
contract that it is or is binding on as a party to the contract or the
provisions of the charter.

 

6.2Party A hereby agrees, confirms, promises and guarantees, actively fulfills
the obligations stipulated in this agreement, and pays the equity transfer
payment in accordance with the conditions stipulated in this agreement; the
company’s trade secrets obtained during the equity transfer process shall not be
disclosed for any purpose or use.

 

6.3Statements, Commitments and Guarantees of Party B and the Company:

 

Except in the case of full disclosure to Party A, Party B and the Company hereby
agree, confirm, promise and guarantee:

 

6.3.1The company’s financial statements are prepared in accordance with PRC
accounting standards. The financial statements fairly and truly reflect the
company’s operating results and assets and liabilities. Except for the
liabilities already stated in the company’s financial statements, the company
does not have other unknown significant liabilities, liabilities or potential
significant liabilities or liabilities. If the company’s financial status and
business have undergone significant adverse changes before the completion date
of the equity transfer, Party A has the right to terminate this agreement.

 

6.3.2All rights and articles required by the company for intellectual property,
land, real estate, movable property, machinery, vehicles, office equipment and
other operations are owned by the company through legal procedures and are The
company will continue to legally own or use the above content after the
effective date of this agreement. In the above content, there is no major reason
for infringing the ownership and use rights of the company. At the same time,
the company does not infringe any third party rights. The company’s assets are
also not subject to any form of security or other form of rights restrictions.

 

6.3.3The company has not transferred or licensed any intellectual property
rights, such as copyrights, trademarks, patents, technical secrets, etc., to any
economic entity or individual; copyrights, trademarks, patents, and technical
secrets owned and used by the company. There is no intellectual property dispute
between any intellectual property rights and any institution or individual at
domestic or abroad. After the completion of this equity transfer, the company
may not transfer or license the company’s copyright, trademark, patent,
technical secret and other intellectual property rights to any economic entity
or individual without the consent of the company’s board of directors. Any
intellectual property rights such as copyrights, trademarks, patents, technical
secrets, etc. generated during the company’s future operation period are owned
by the company.

 

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6.3.4Party B and the company have fully disclosed all important contracts during
the company’s existence to Party A, and ensure that each important contract is a
legal document and is binding on the parties to the contract. The company has
not violated any of the above important contracts, and there is no known
situation and no third party is in violation of the above important contracts.

 

6.3.5Party B and the company have fully disclosed to Party A all matters related
to taxation, civil litigation/arbitration, administrative penalties, external
guarantees or other contingent liabilities incurred during the company’s
existence. In addition to the situation that has been fully disclosed to Party
A, the company’s production and operation activities, production facilities,
venues, investment projects, etc. are in compliance with relevant national laws
and regulations, including but not limited to industry access, environmental
protection, quality, taxation, customs, foreign exchange. Laws and regulations
on labor, land, etc. The company has fulfilled its tax liability for payment,
and there is no tax amount that is due and payable. Party C agrees to bear all
the liabilities arising from the existing/or tax liabilities, civil litigation,
administrative penalties, fines, external guarantees or other contingent
liabilities that have not been fully disclosed to Party A. Party C provides
guarantee for the above responsibilities with the company’s equity held by it.

 

6.3.6The information and materials provided by Party B and the company to the
lawyers, accountants and other intermediary consultants hired by Party A and
Party A do not have any false records, misleading statements and important
omissions, and their substantive authenticity and accuracy, and assume full
responsibility for its substantial authenticity, accuracy and completeness.

 

6.3.7Party B and the company further promise that all the approval and
registration procedures for the equity transfer will be handled as soon as
possible, and the consents required by this agreement will be obtained; and
ensure that all reasonable measures and actions required for the smooth
operation and legal effect of the transactions under this Agreement are taken or
carried out in accordance with the provisions of the current Chinese laws and
regulations and the requirements of the examination and approval authority and
other relevant government agencies; this includes, but is not limited to, the
procedures for changing the major events of the company’s private equity fund
managers and other changes to the relevant licenses or approvals; Before or
during the application for the above-mentioned approval, change registration and
approval or consent, the company shall solicit Party A’s opinions and timely
disclose relevant progress information and conditions (including formal and
informal feedback from the approval authority). A copy of the relevant documents
and materials should be provided with at least one set for Party A to file.

 

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7.Tax

 

The relevant taxes and fees involved in the performance of the equity transfer
under this agreement shall be borne by each of Party A and Party B according to
law.

 

8.Liability for breach of contract

 

8.1If either party violates the agreement of this agreement and does not correct
it within 30 days after receiving the notice of the breach of contract by the
observing party, the observant party has the right to terminate this agreement;
the defaulting party shall also compensate for the breach of contract and all
losses caused by the observant party.

 

8.2Party B, Party C and the company, in isolation or in common, violate any of
the guarantees or promises in this Agreement (whether or not the terms are
expressly stated as “guarantee” or “commitment”, as long as the content of the
terms is a guarantee or commitment, if Party A’s purpose is materially and
materially affected, Party A shall have the right to request Party B to return
the equity transfer payment. Party B shall return the full amount of the equity
transfer payment paid by Party A to Party A within 10 working days after Party A
submits the written notice. Based on the amount of payment by Party A, Party A
shall pay Party A the liquidated damages which is double the bank’s loan
interest rate for the same period from the date when Party A’s funds are in
place to the date when Party B returns the equity transfer money to Party A.

 

9.Confidentiality clause

 

The parties undertake that, regardless of whether they can reach an agreement on
this equity transfer, they shall not disclose and/or disclose in any way any
information of this equity transfer and the other party’s business information
and trade secrets known to others. Such commitments by all parties should be
indefinite. Notwithstanding the foregoing, parties to this Agreement may
disclose or disclose the contents of this Agreement or the details of the
transactions involved in the following circumstances:

 

9.1Directed by the court or administrative authority that has jurisdiction to
disclose or disclose;

 

9.2to disclose or disclose to employees, consultants, lawyers, appraisers or
auditors who are relevant and who must be aware of such content or details;

 

9.3to be disclosed or disclosed in accordance with the instructions of the
relevant stock exchange or other securities regulator or the listing rules;

 

9.4required or disclosed in accordance with laws or regulations.

 

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10.Cost commitment

 

The parties agree that if the industrial and commercial registration of the
equity change is completed, Party B shall undertake the fees of due diligence,
evaluation, negotiation, drafting of legal opinions, and drafting of major
issues of private fund managers by external intermediary agencies (including
lawyers and auditors) for transactions under this agreement and previous
parties’ consultation programs, legal opinions and other related fees. If the
industrial and commercial registration of the equity change is not completed,
each of them shall bear the above-mentioned expenses.

 

11.Legal application and dispute resolution

 

11.1The conclusion, validity, interpretation, performance and settlement of
disputes of this Agreement shall be governed by the laws of the People’s
Republic of China.

 

11.1All disputes arising out of or in connection with the implementation of this
Agreement shall be settled through friendly negotiation. If the negotiation
cannot be resolved, any party may file a lawsuit in the grassroots people’s
court of Party A.

 

12.Force majeure

 

In the event of an earthquake, typhoon, flood, war, government action, or other
force majeure that cannot be prevented or avoided by the parties to this
Agreement and its occurrence and consequences, this Agreement cannot be
fulfilled, The party that encounters the above force majeure accident shall
immediately notify the other parties in writing of the accident, and shall
provide valid documentation to issue the details issued by the competent
department within seven days, which may explain the details of the force majeure
accident and the reasons for the contract not being fulfilled or partially
unable to perform or the need to postpone the performance.

 

13.Other matters

 

13.1This Agreement shall become effective upon signature and seal by the
parties.

 

13.2Any modification of any content of this Agreement shall be subject to
negotiation by all parties and a written supplementary contract shall be signed.
Neither party shall have the right to unilaterally modify any content of this
Agreement.

 

13.3Matters not covered in this Agreement will be agreed upon by the parties to
this Agreement and will be supplemented in writing. This written supplement is
an integral part of this Agreement and has the same legal effect as this
Agreement.

 

13.4This Agreement is in quadruplicates, Party A holds one copy, Party B holds
one copy, and each share of this agreement has the same legal effect.

  

(There is no text below)

 

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This page is the signing page of the Equity Transfer Agreement for Sanhe
Xiangtian Power Engineering Co., Ltd.

  

Party A: Xianning Sanhe Xiangtian Power Equipment Manufacturing Co., Ltd.

[Corporate seal affixed herein]

 

Legal representative or authorized representative: /s/ Zhou
Dengrong                       

  

Party B:

 

Zhou Jian

Signature: /s/ Zhou Jian  

 

Zhou Dengrong

Signature: /s/ Zhou Dengrong  

 

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