Exhibit 10.1


 


HUAYUE ELECTRONICS
INC.


 


SHAREHOLDERS AGREEMENT


 


Dated as of


 


June 12, 2015


 




    	 



    	 



    

 


THIS SHAREHOLDERS
AGREEMENT (this “Agreement”) is made and entered into as of June 12, 2015 (the “Effective Date”),
by and among Huayue Electronics Inc. (the “Company”) and the shareholders of the Company signatory hereto (the
“Shareholders”).


 


WHEREAS, the Company
intends to enter into a transaction (the “Disposition Transaction”) with Shudong Pan, the Chairman of the Board
and a principal stockholder of the Company, pursuant to which Mr. Pan will purchase from the Company 100% of the capital stock
of China Metal Holding Inc., a Delaware corporation (“CMHI”) and the owner of 100% of the capital stock of
Changzhou Huayue Electronics Inc., a company organized under the laws of The People’s Republic of China (“Changzhou
Huayue”), in consideration of the sale and transfer by Mr. Pan to the Company of 10,000,000 shares of Common Stock,
par value $0001 per share (the “Common Stock”), of the Company; and


 


WHEREAS, the Company intends to enter into
a Supplier/Distributor Agreement with Changzhou Huayue giving Changzhou Huayue the right to sell in China SavWatt branded products
for a royalty of 5% and further granting Changzhou Huayue the right of first refusal to produce SavWatt LED bulbs provided that
Changzhou Huayue’ s quality, terms of payment and delivery are the same if not better than other suppliers; and










 


WHEREAS, the Company
intends to enter into a transaction (the “SavWatt Transaction”) with SavWatt USA, Inc. (“SavWatt USA”)
whereby the Company will acquire from SavWatt USA the “SavWatt” name and brand and all trademarks and related intellectual
property owned by SavWat USA in consideration of the issuance by the Company to SavWatt USA of 1,000,000 shares of Common Stock;
and


 


WHEREAS, it is a condition
to the consummation of the Disposition Transaction and the SavWatt Transaction that the Shareholders and the Company to enter into
this Agreement to provide for certain restrictions with regard to Transfers (as defined herein) and for other obligations and rights
of the Shareholders and the Company as set forth herein.


 


NOW, THEREFORE, in consideration
of the mutual covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereby agree as follows:


 


ARTICLE
I


 


GENERAL TRANSFER PROVISIONS


 


1.1         General
Restrictions. No shares of Common Stock, or options or warrants to acquire Common Stock, now owned or hereafter acquired
by any of the Shareholders may be sold, assigned, transferred, given away or in any way disposed of (any of the foregoing being
hereinafter referred to as a “Transfer”) at any time prior to June 1, 2016 (the “Transfer Term”),
unless:


 


(i)          the
individual, firm, corporation, partnership, trust or other entity (“Person”) in whose favor such Transfer is
made (other than the Company) (a) is a Permitted Transferee (as defined below) and (b) delivers to the Company a written acknowledgment
that the shares of Common Stock or options or warrants to acquire Common Stock to be Transferred are subject to this Agreement,
and that such Person and such Person’s successors-in-interest are bound hereby and thereby. For purposes of this Agreement,
“Permitted Transferee” shall mean (a) the guardian, conservator, heir or estate of any Shareholder, (b) any
corporation, partnership or limited liability company in which all of the outstanding securities and other interests are owned
by a Shareholder or Shareholders, (c) any individual or corporation that owns, directly or indirectly, all of the outstanding securities
and other interests of a Shareholder or the guardian, conservator or estate of any such individual as of the date hereof, (d) any
member of the immediate family of a Shareholder, (e) any trust, all of the beneficiaries of which are a Shareholder or members
of the immediate family of a Shareholder, or (f) any affiliate controlled by, or under common control with, a Shareholder; provided,
however, that a Permitted Transferee shall not be a competitor of the Company (as determined in good faith by the Board of Directors
of the Company, in its sole discretion); and


 




    	 



    	 



    

 


(ii)         such
Transfer shall be made (a) pursuant to an effective registration under the Securities Act of 1933, as amended (as hereafter amended
from time to time (the “Securities Act”), or an exemption from the registration requirements thereof and (b)
in accordance with applicable state law and the terms of this Agreement; and


 


(iii)        prior
to any such Transfer, the Shareholder proposing to make such Transfer shall give the Company (a) written notice describing the
manner and circumstances of the proposed Transfer and (b) if reasonably requested by the Company, a written opinion in form and
substance reasonably satisfactory to the Company’s legal counsel to the effect that the proposed Transfer may be effected
without registration under the Securities Act or any applicable state law.


 


Any attempted Transfer
other than in accordance with this Agreement shall be void, and the Company shall refuse to recognize any such Transfer and shall
not reflect on its records any change in record ownership of the shares of Common Stock or options or warrants to acquire Common
Stock pursuant to any such Transfer. The Company shall also instruct any transfer agent to put a hold on the Common Stock held
by the Shareholders, as reasonably necessary, during the Transfer Term.


 


1.2         Mechanics
of Transfer. Any Shareholder that Transfers shares of Common Stock or options or warrants to acquire Common Stock shall
(i) take all such actions and execute and deliver all such documents as may be necessary or reasonably requested by the Company
in order to consummate the Transfer of such shares of Common Stock or options or warrants to acquire Common Stock and (ii) pay
to the Company such amounts as may be required for any applicable stock transfer taxes.


 


1.3         Pledge
and Hypothecation Prohibited. No Shareholder shall in any manner pledge, hypothecate or encumber, or grant options with
respect to his, her or its shares of Common Stock or options or warrants to acquire Common Stock during the Transfer Term.


 


1.4         Regulatory
Requirements. Notwithstanding any provision of this ARTICLE I or this Agreement in its entirety, the Company shall not
take any action, and shall be under no obligation to take any action, if such action would cause a reasonable probability that
the Company could be deemed to have violated any law or regulation to which it is subject (including, without limitation, the maintenance
of a sufficient capital surplus). In no event shall a Shareholder effectuate a Transfer to a Permitted Transferee if such acceptance
would be contrary to any applicable law or regulation to which the Company is subject.


 




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ARTICLE
II


 


CORPORATE GOVERNANCE


 


2.1         Board
of Directors. During the two-year period commencing on the date hereof (“Board Term”), the Shareholders, by
majority vote, may elect and appoint two (2) directors to the Board of Directors (the “Shareholder Directors”) of the
Company (the “Board”), who shall serve on the Board until their successors are duly elected. The Shareholders
hereby initially appoint Dr. Yunzhong Wu and Yile Lisa Pan as the Shareholder Directors. During the Board Term, each Shareholder
shall vote its shares of Common Stock, and each Shareholder and the Company shall take all other actions necessary, to elect the
Shareholder Directors to serve as directors of the Company and to give effect to the provisions of this Agreement and to ensure
that the Company’s Certificate of Incorporation (the “Certificate of Incorporation”) does not, at any
time hereafter, conflict in any respect with the provisions of this Agreement and no Shareholder shall vote his or her shares in
favor of any amendment of the Certificate of Incorporation or of any merger which would conflict with, or purport to amend or supersede,
any of the provisions of this Section 2.1. The Shareholders agree that, during the Board Term, the Shareholder Directors may not
be removed from the Board without the written consent of the majority of the Shareholders. The Shareholders also agree that the
Shareholders, by majority consent, shall have the right, exercisable at any time during the Board Term with or without cause, to
remove a Shareholder Director from the Board and to nominate a replacement director as provided herein, whereupon the Shareholders
and the Company will convene a special meeting or act by written consent so as to elect such replacement to serve as a director
of the Company. The Shareholders shall take all actions that are necessary or desirable to ensure the election or appointment of
the nominees to the Board specified in this Section 2.1.


 


2.2         Restrictions
on Other Agreements. Except as provided for in this Agreement, no Shareholder shall grant any proxy, or enter into or agree
to be bound by any voting trust, with respect to shares of Common Stock or convertible securities or underlying shares of capital
stock or enter into any shareholders’ agreement or arrangement of any kind with any person with respect to shares of Common
Stock or convertible securities or underlying shares of capital stock, in any such case on terms inconsistent with the provisions
of this Agreement, including, without limitation, agreements or arrangements with respect to the acquisition, disposition or voting
of shares, of Common Stock, or convertible securities or underlying shares of capital stock in a manner inconsistent with this
Agreement.


 


2.3         Board
Consent for Certain Actions. The Company and the Shareholders agree that the Company shall not cause a reverse or forward split
of the Common Stock, or enter into any kind of other similar arrangement with respect to the Common Stock, without the unanimous
consent of the full Board. In addition, the Company and the Shareholders agree that majority consent of the full Board is required
for (i) all issuances of Common Stock or any other equity of the Company, and (ii) the Company to enter into a management agreement,
consulting agreement, employment agreement or other agreement for the provision of services with a senior executive or any senior
management of the Company.


 




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ARTICLE
III


 


CERTIFICATES


 


3.1         Restrictive
Endorsements. Each certificate evidencing any shares of capital stock of the Company owned by any Shareholder or issued
on or after the date hereof to any Shareholder shall bear a legend in substantially the following form:


 


“The
securities evidenced by this certificate are subject to a Shareholders Agreement, dated as OF JUNE 12, 2015. Such Shareholders
Agreement provides, among other things, for certain restrictions on voting, sale, transfer, pledge, hypothecation or other disposition
of the securities evidenced by this certificate.”


 


In addition, unless
counsel to the Company shall have advised the Company that such legend is no longer needed, each certificate evidencing any shares
of Common Stock shall bear a legend in substantially the following form:


 


“THE
SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAW. NEITHER THE SECURITIES NOR ANY INTEREST OR PARTICIPATION THEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
OR UNLESS HUAYUE ELECTRONICS INC. HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT AN EXEMPTION FROM SUCH
REGISTRATION IS AVAILABLE.”


 


3.2         Stock
and Stock Option Agreements. Each agreement granting to any employee of the Company or its subsidiaries any shares of Common
Stock or an option to purchase any shares of Common Stock from and after the date of this Agreement shall include a provision requiring
the grantee, as a condition to the acquisition of any Common Stock pursuant to such agreement, to consent to the terms of this
Agreement and execute a counterpart hereof.


 




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3.3         Replacement
Certificates. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation
of any certificate evidencing shares of Common Stock and of a bond or other indemnity reasonably satisfactory to the Company and
upon reimbursement to the Company of all reasonable expenses incident thereto, and upon surrender of such certificate, if mutilated,
the Company will make and deliver a new certificate of like tenor in lieu of such lost, stolen, destroyed or mutilated certificate.


 


ARTICLE
IV


 


SHAREHOLDER CONSENT


 


Each of the Sharholders,
in his or her capacity as a stockholder of the Company, hereby acknowledges, consents to and approves the following resolutions
as the resolutions of the stockholders of the Company:


 


RESOLVED,
that the consummation by the Company of the each of the Disposition Transaction and the SavWatt Transaction shall be, and hereby
is approved, on the general terms set forth herein and on such other terms and conditions as the Board shall approve; and it is
further


 


RESOLVED,
that the Company shall be, and hereby is, authorized to amend the Certificate of Incorporation to (i) increase the authorized number
of shares of Common Stock from 60,000,000 shares to 150,000,000 shares, (ii) increase the number of authorized shares of preferred
stock, par value $0001 per share, from 1,000,000 shares to 10,000,000 shares, and (iii) change the name of the Company from Huayue
Electronics Inc. to such name as the Board shall authorize and approve.


 


ARTICLE
V


 


MISCELLANEOUS


 


5.1         Equitable
Relief. The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this Agreement
and that equitable relief, including specific performance and injunctive relief, may be used to enforce such provisions.


 




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5.2         Notices.
Any and all notices, designations, consents, offers, acceptances, or any other communication provided for herein shall be given
in writing by hand, facsimile transmission or by registered or certified mail, addressed to the address specified for such party
on the signature pages hereof, or to such other address as may be designated in writing by any such party. Except as otherwise
provided in this Agreement, each such notice shall be deemed given when delivered in person or by facsimile transmission or on
a date which is three days after it is mailed at any post office or branch post office regularly maintained by the United States
Postal Service (registered or certified, with postage prepaid and properly addressed) or State Post Bureau of the Peoples Republic
of China.


 


5.3         Entire
Agreement; Amendment and Waiver. This Agreement constitutes the full and entire understanding and agreement among the parties,
and supersedes all prior understandings or agreements, with regard to the subject hereof. No change in or modification of this
Agreement or waiver of any of the terms or provisions hereof shall be valid unless the same shall be in writing and signed by the
Company and Shareholders of more than fifty percent of the shares of Common Stock owned of record by the Shareholders at the time
of such amendment. Any amendment, modification or waiver effected in accordance with this Section 5.3 shall be binding upon all
Persons that are parties to or bound by this Agreement whether or not they join in or consent to such amendment, modification or
waiver.


 


5.4         Waiver.
No failure or delay on the part of the parties or any of them in exercising any right, power or privilege hereunder, nor any course
of dealing between the parties or any of them shall operate as a waiver of any such right, power or privilege nor shall any single
or partial exercise of any such right, power or privilege preclude the simultaneous or later exercise of any other right, power
or privilege. The rights and remedies herein expressly provided are cumulative and are not exclusive of any rights or remedies
which the parties or any of them would otherwise have. No notice to or demand on the Company in any case shall entitle the Company
to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the other parties
or any of them to take any other or further action in any circumstances without notice or demand.


 


5.5         Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original but all of which together
shall constitute one and the same instrument.


 


5.6         Governing
Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware
without regard to principles of conflicts of laws.


 


5.7         Filing.
A copy of this Agreement and of all amendments hereto shall be filed at the principal office of the Company.


 


5.8         Termination.
This Agreement shall automatically expire on the date that is the second anniversary of the date hereof.


 




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5.9         Benefit
and Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective
executors, administrators, personal representatives, heirs, successors and permitted assigns.


 


5.10       Severability.
In the event that any portion of this Agreement shall be held to be invalid or unenforceable to any extent, such portion shall
be enforced to the fullest lawful extent and the remaining parts hereof shall nevertheless continue to be valid and enforceable
as though the invalid portions were not a part hereof. If any time period set forth herein is held by a court of competent jurisdiction
to be unenforceable, a different time period that is determined by the court to be more reasonable shall replace the unenforceable
time period.


 


[Signature pages
follow]


 




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IN WITNESS WHEREOF,
the parties hereto have executed this Shareholders Agreement as of the day and year first above written.


 





	 	HUAYUE ELECTRONICS INC.
	 	 	 
	 	By:	/s/ Isaac Sutton
	 	 	Name: Isaac Sutton
	 	 	Title: Chief Executive Officer 







 


	 	Address:	475 Park Avenue, 30th Floor
	 	 	New York, New York  10016


 


[SIGNATURE PAGE TO SHAREHOLDERS AGREEMENT]


 




    	 



    	 



    

 


IN WITNESS WHEREOF,
the parties hereto have executed this Shareholders Agreement as of the day and year first above written.


 


	 	SHAREHOLDER:
	 	 
	 	/s/ Shudong
    Pan
	 	Name:  Shudong Pan
	 	 
	 	Number of Shares:      10,809,000


 


	 	Address:	3 Huanzheng Road
	 	 	Changzhou, China 213144


 


	 	SUTTON GLOBAL ASSOCIATES INC.
	 	 	 
	 	By:	/s/ Isaac Sutton
	 	 	Name: Isaac Sutton
	 	 	Title: Chief Executive Officer


 


	 	Number of Shares:       3,000,000
	 	 	 
	 	Address:	475 Park Avenue, 30th Floor
	 	 	New York, New York  10016


 


	 	/s/ Xinmei Li
	 	Name:  Xinmei Li
	 	 
	 	Number of Shares:     2,270,370


 


	 	Address:	3 Huanzheng Road
	 	 	Changzhou, China 213144


 


	 	/s/ Kuanlian Peng
	 	Name:  Kuanlian Peng
	 	 
	 	Number of Shares:     520,000


 


	 	Address:	Runzeyuan Kaifaqu
	 	 	Dalian, China


 


[SIGNATURE PAGE TO SHAREHOLDERS AGREEMENT]


 






    	 



    	 



    

 


	 	/s/ Hao Wang
	 	Name:  Hao Wang
	 	 
	 	Number of Shares:     450,000


 


	 	Address:	
	 	 	Laoranfang Paotai
	 	 	Dalian, China


 





	 	/s/ Jianxia Li
	 	Name: Jianxia Li
	 	 
	 	Number of Shares:    259,816







 





	 	Address:	51 Huiling Road 
	 	 	Changzhou, China
	 	 	 







 





	 	/s/ Shurong Li
	 	Name: Shurong Li
	 	 
	 	Number of Shares:    305,000







 





	 	Address:	51 Huiling Road 
	 	 	Changzhou, China
	 	 	 







  


[SIGNATURE PAGE TO SHAREHOLDERS AGREEMENT]