f8k0410ex10vii_silverpearl.htm


     

    
      Exhibit
10.7


       

      SHARE
TRANSFER AGREEMENT

       

       

       

       

      BETWEEN

       

       

       

      Brian
Pak-Lun Mok

       

       

       

      AND

       

       

       

      Chunfeng
Tao

       

       

       

       

       

       

       

       

      Date:
April 2, 2010

      


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      THIS
SHARE TRANSFER AGREEMENT (this "Agreement") is made on April
2, 2010 by and among Brian Pak-Lun Mok (the "Transferor") and the
individual listed in Schedule
A hereto (the "Transferee").

       

      The
Transferor and the Transferee are collectively referred to as the "Parties" and
each of them as a "Party".

       

      Whereas,
the Transferor holds 50,000 ordinary shares in Apex Smart Limited (the
"Company") and is the sole registered shareholder of the Company; the Company is
one of the registered shareholders of Delight Reward Limited, a British Virgin
Islands Company, which intends to complete a business combination with a public
shell company traded on the Over the Counter Bulletin Board (the "Listed
Company").

       

      Whereas,
the Transferee has contributed to the wealth growth of the Transferor through
the growth of the Company, the Listed Company, Delight Reward Limited and their
PRC subsidiaries and affiliates (collectively with the Company, the "Group"). In consideration of
the Transferee' contributions and as an incentive to the Transferee to continue
his/her commitment to the Group, the Transferor has agreed to grant to the
Transferee, and the Transferee has agreed to accept from the Transferor, an
option (the "Option") to
purchase certain number of ordinary shares of the Company currently held by the
Transferor (the "Option
Shares") as set forth in Schedule A hereto, on the
terms and subject to the conditions set out in this Agreement.

       

      NOW,
THEREFORE, in consideration of the foregoing recitals, the mutual promises
hereinafter set forth, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:

       

      1.           
DEFINITIONS

       

      1.1         
Defined
Terms : In this Agreement (including the Recitals and the Schedules),
unless the context otherwise requires, the following words and expressions shall
have the following meanings:

       

      "Acquisition" means the
transaction wherein the Listed Company will acquire 100% equity interest
(whether directly or through its subsidiaries) of the Ningbo Keyuan Plastics
Co., Ltd. 

       

      "Alternate Exercise Price"
means the exercise price to be paid by a Transferee to the Transferor in
respect of the Option Shares issued to such Transferee as set forth opposite
his/her name in Schedule
A in the event that the Performance Targets (as defined herein) have not
been met by the Group;

       

      "Business Day" means a day
(other than Saturdays, Sundays and public holidays) on which banks are generally
open for business in China;

       

      "China" or "PRC" means the
People's Republic of China, and for purpose of this Agreement, excluding the
Hong Kong Special Administrative Region, the Macao Special Administrative Region
and the island of Taiwan;

       

      "Completion Date" means
the date falling seven (7) Business Days after the service of the Exercise
Notice by the Transferee on the Transferor;

       

      "Completion" means the
completion of the sale to and purchase by the Transferee of the Option Shares
under this Agreement;

       

      "Distributions" means any cash
proceeds arising from or in respect of, or in exchange for, or accruing
to or in consequence of the Option Shares from the Effective Date to the
Completion Date, including without limitation the Dividends.

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

       

      "Dividends" means the dividends declared by the
Company and accrued in respect of the Option Shares (whether or not such
dividends shall have been paid and received by the Transferor);

       

      "Effective Date" means the
date of this Agreement;

       

      "Exercise" means the exercise by a Transferee
or his/her Nominee(s) of the Option pursuant to the terms of this
Agreement;

       

      "Exercise Notice" means the
notice substantially in the form set out in Part I of Schedule B;

       

      "Exercise Price" means the
exercise price to be paid by a Transferee to the Transferor in respect of the
Option Shares issued to such Transferee as set forth opposite his/her name in
Schedule A;

       

      "Nominee" means such person nominated by a
Transferee in the Transfer Notice to be the transferee of the Option or Option
Shares;

       

      "Option Effective Dates" have
the meaning ascribed to them in Clause 2.3;

       

      "Performance Targets" have the
meaning ascribed to them in Clause 3;

       

      "RMB"
means the lawful currency of China;

       

      "Transfer Notice" means the
notice substantially in the form set out in Part II of Schedule B; "US$" or "United States Dollar" means
the lawful currency of the United States of America.

       

      1
..2.        Interpretation:
Except to the extent that the context requires otherwise:

       

      
        
          
            	
                     
      

                  	
                    1.2.1 

                  	
                    words
      denoting the singular shall include the plural and vice versa; words
      denoting any gender shall include all genders; words denoting persons
      shall include firms and corporations and vice
      versa;

                  


          

           

        

      

      
        
          
            
              	
                       
      

                    	
                      1.2.2 

                    	
                      any
      reference to a statutory provision shall include such provision and any
      regulations made in pursuance thereof as from time to time modified or
      re-enacted whether before or after the date of this Agreement and (so far
      as liability thereunder may exist or can arise) shall include also any
      past statutory provisions or regulations (as from time to time modified or
      re-enacted) which such provisions or regulations have directly or
      indirectly replaced;

                    


            

             

          

        

        
          
            
              	
                       
      

                    	
                      1.2.3 

                    	
                      the
      words "written"
      and "in writing"
      include any means of visible
  reproduction;

                    


            

             

          

        

        
          
            
              	
                       
      

                    	
                      1.2.4  

                    	
                      any
      reference to "Clauses",
      "Recitals" and "Schedules" are to be construed as references
      to clauses and recitals of and schedules to, this Agreement;
      and

                    


            

             

          

        

        
          
            
              	
                       
      

                    	
                      1.2.5 

                    	
                      any
      reference to a time of day is a reference to China time unless provided
      otherwise.

                    


            

             

          

        

      

      
        1.3.         Headings: The
headings in this Agreement are inserted for convenience only and shall
be
ignored
in construing this Agreement.

      

       

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      2.           
OPTION

       

      
        2.1.        
Option: In
consideration of the contributions which the Transferee has made to the Group
and their continuing commitment to the Group, the Transferor hereby irrevocably
and unconditionally grants to the Transferee the Option for such Transferee to
acquire from the Transferor, at the Exercise Price or the Alternative Exercise
Price, at any time during the Exercise Period (defined below) any or all of the
Option Shares set forth opposite his/her name in Schedule
A hereto, free from all claims, liens, charges, pledges, mortgages,
trust, equities and other encumbrances, and with all rights attaching thereto on
the Completion Date.

      

       

      
        2.2.        
Vesting Schedule:
Subject to the terms and conditions hereto, the Option may be exercised,
in whole or
in part, in accordance with the following schedule:

         

        The
Option Shares subject to the Option shall vest at the rate of one-third (1/3)
per Performance Period (as defined in Exhibit A).

      

       

      
        	
                2.3.

              	
                Exercise Period:
      Once the Acquisition has been completed or abandoned pursuant to
      the terms of the definitive agreement regarding the Acquisition, the
      Option shall be exercisable in accordance with and on the dates set forth
      in Exhibit
      A (the "Option
      Effective Dates"). Subject to the vesting schedule set forth in
      Section 2.2 of this Agreement, the Option may be exercised by any
      Transferee (or his/her Nominee on behalf of the Transferee) at any time
      following the Option Effective Date ("Exercise
      Period").

              


      

       

      
        	
                2.4.

              	
                Nominees: Each
      of the Transferee may, at any time during the Exercise Period, at his/hex
      sole discretion, nominate one or more person(s) (each a "Nominee")
      to be the transferee(s) of whole or part of his/her Option, who
      shall hold and/or exercise the transferred Option on behalf of the
      Transferee.

              


      

       

      
        	
                2.5.
      

              	
                Exercise Notice:
      The Option may be exercised by any Transferee or his/her
      Nominee(s), in whole or in part, at any time during the Exercise Period,
      by serving an Exercise Notice on the
Transferor.

              


      

       

      
        	
                2.6.
      

              	
                Exercise: The
      Transferor agrees that he shall, upon receipt of the Exercise Notice and
      payment of either the Exercise Price or the Alternative Exercise Price,
      depending on whether the Performance Targets have been met, issue to the
      Transferee(s) (or his/her Nominee(s), as the case may be) any and all of
      the Option Shares specified in the Exercise Notice, free from all claims,
      liens, charges, pledges, mortgages, trust, equities and other
      encumbrances, and with all rights now or hereafter attaching thereto. The
      Option shall be exercisable only in compliance with PRC laws and
      regulations and the Transferee(s) (or his/her Nominee(s), as the case may
      be) shall complete any and all approval or registration procedures
      regarding the exercise of his/her Option at PRC competent authorities in
      accordance with applicable PRC laws and
  regulations.

              


      

       

      
        	
                2.7.
      

              	
                Transfer Notice:
      In case that any Transferee transfers any or all of his/her Option
      to one or more Nominee(s) in accordance with Clause 2.4 above, the
      Transferee shall serve a Transfer Notice on the
  Transferor.

              


      

       

      
        	
                2.8.
      

              	
                Transfer to Nominees:
      The Transferor agrees that he shall, upon receipt of the Transfer
      Notice, take all actions necessary to allow the Nominee(s) to be entitled
      to any or all of the Options specified in the Transfer
Notice.

                 

                Upon exercise by any Nominee(s) of the transferred
      Option on behalf of the Transferee, the Transferee shall serve the
      Exercise Notice on the Transferor in his/her own name for the exercising
      Nominee(s). Upon receipt of such Exercise Option, the Transferor shall
      issue to such
      Nominee(s) any and all of the relevant Option Shares in the same manlier
      as specified in Clause 2.6.

              


      

       

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

       

      
        	
                2.9.

              	
                Payment of Exercise
      Price: Upon Exercise of the Option in whole or in part, the
      exercising Transferee (or his/her Nominee(s), as the case may be) shall
      pay the Exercise Price to the
Transferor.

              


      

       

      
        	
                2.10.
      

              	
                The Transferor's
      Obligation upon Exercise: The Transferor agrees that upon the
      Exercise of any Option by any Transferee (or his/her Nominee(s)), he shall
      cause and procure the number of Option Shares provided in the Exercise
      Notice to be transferred to such exercising Transferee (or his/her
      Nominee(s)) within seven (7) Business Days after the date of the Exercise
      Notice.

              


      

       

      3.          
 PERFORMANCE
TARGET AND CONDITION PRECEDENT

       

      
        	
                3.1.
      

              	
                The
      obligation of the Transferor to effect the Option and the transfer of the
      Option Shares at the Exercise Price to an exercising Transferee upon
      his/her Exercise of the Option shall be subject to the fulfilment of the
      conditions set forth in Exhibit
      A hereto (the "Performance
      Targets"). In the event
      that the Group does not achieve the Performance Targets specified in
      Exhibit A, then the Transferee may exercise the Option at the Alternative
      Exercise Price on the date at which the Option would have otherwise been
      exercisable had the Performance Targets been
  met.

              


      

       

      4.           
INFORMATION,
DISTRIBUTIONS AND ADJUSTMENTS

       

      
        	
                4.1.
      

              	
                Information:
      The Transferee (the "Requesting
      Transferee") shall be entitled to request from the Transferor at
      any time before the Completion, a copy of any information received from
      the Group which may be in the possession of the Transferor and, upon such
      request, the Transferor shall provide such information to the Requesting
      Transferee(s).

              


      

       

      
        	
                4.2.
      

              	
                Distributions:
      The Transferor agrees that the Transferee shall be entitled to all
      the Distributions in respect of his/her Option Shares. In the event
      that any such Distributions have been received by the Transferor for any
      reason, the Transferor shall, at the request of the relevant Transferee,
      pay an amount equivalent to the Distributions received by him/her to such
      Transferee at the time of the Option Exercise by the
      Transferee.

              


      

       

      
        	
                4.3.

              	
                Adjustments:
      If,
      prior to the Completion, the Company shall effect any adjustment in
      its share capital (such as share split, share dividend, share combination
      or other similar acts), then the number of Option Shares to be issued to
      the Transferee upon Exercise shall be adjusted accordingly to take into
      account such adjustment.

              


      

       

      5.           
COMPLETION

       

      
        	
                5.1.
      

              	
                Time and Venue:
      Completion of the sale and purchase of the Option Shares pursuant
      to the Exercise shall take place at such place decided by the exercising
      Transferee(s) on the Completion
Date.

              


      

       

      
        	
                5.2.

              	
                Business at
      Completion: At Completion of each Exercise, all
      (but not part only) of the following
      shall be transacted:

              


      

       

      
        
          	
                   
      

                	
                  5.2.1

                	
                  the
      exercising Transferee shall pay the Exercise Price to the Transferor in
      cash;

                


        

         

      

      
        	
                 
      

              	
                5.2.2

              	
                the
      Transferor shall cause the Company to within seven (7) Business Days after
      the date of Exercise Notice, deliver to the exercising Transferee(or
      his/her Nominee(s), same
      below) the following documents and take all corporate actions necessary to
      give effect to such
delivery:

              


      

       

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      
        	
                (a)  

              	
                a
      share certificate or share certificates in respect of the number of the
      Option Shares exercised by such exercising
  Transferee;

              


      

       

      
        	
                (b)  

              	
                a
      certified true copy of the register of members of the Company updated to
      show the entry of the exercising Transferee as the holder of the Option
      Shares so exercised; and

              


      

       

      
        
          	
                  (c)  

                	
                  any
      other documents as the exercising Transferee may reasonably believe necessary
      to give effect to the issuance of the exercised Option
      Shares.

                


        

         

      

      6.           
CONFIDENTIALITY

       

      The
transaction contemplated hereunder and any information exchanged between the
Parties pursuant to this Agreement will be held in complete and strict
confidence by the concerned Parties and their respective advisors, and will not
be disclosed to any person except: (i) to the Parties' respective officers,
directors, employees, agents, representatives, advisors, counsel and consultants
that reasonably require such information and who agree to comply with the
obligation of non-disclosure pursuant to this Agreement; (ii) with the express
prior written consent of the other Party; or (iii) as may be required to comply
with any applicable law, order, regulation or ruling, or an order, request or
direction of a government agency; provided, however, that the foregoing shall
not apply to information that: (1) was known to the receiving Party prior to its
first receipt from the other Party; (2) becomes a matter of public knowledge
without the fault of the receiving Party; or (3) is lawfully received by the
Party from a third person with no restrictions on its further
dissemination.

       

      7.            TRANSFEROR'S
UNDERTAKINGS

       

      Without
the prior written consent of the Transferee, the Transferor shall vote his
shares in the Company such that the Company and any other member of the Group
shall not, (i) issue or create any new shares, equity, registered capital,
ownership interest, or equity-linked securities, or any options or warrants that
are directly convertible into, or exercisable or exchangeable for, shares,
equity, registered capital, ownership interest, or equity-linked securities of
any member of the Group, or other similar equivalent arrangements, (ii) alter
the shareholding structure of any member of the Group, (iii) cancel or otherwise
alter the Option Shares, (iv) amend the register of members or the memorandum
and articles of association of any member of the Group, (v) liquidate or wind up
any member of the Group, or (vi) act or omit to act in such a way that would be
detrimental to the interest of the Transferee in the Option Shares. The
Transferor shall cause the Company to disclose to the Transferee true copies of
all the financial, legal and commercial documents of any member of the Group and
the resolutions of the shareholders and the board of directors.

       

      8.           
MISCELLANEOUS

       

      
        	
                8.1

              	
                Indulgence, Waiver
      Etc: No failure on the part of any Party to exercise and no delay
      on the part of such Party in exercising any right hereunder will operate
      as a release or waiver thereof, nor will any single or partial exercise of
      any right under this Agreement preclude any other or further exercise of
      it or any other right or remedy.

              


      

       

      
        	
                8.2.

              	
                Effective Date and Continuing Effect
      of Agreement: This Agreement shall take effect from the Effective
      Date. All provisions of this Agreement shall not, so far as they have not
      been performed at Completion, be in any respect extinguished or affected
      by Completion or by any other event or matter whatsoever and shall
      continue in full force and effect so far as they are capable of being
      performed or observed, except in respect of those matters then already
      performed.

              


      

       

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      
        	
                8.3.

              	
                Successors and
      Assigns: This Agreement shall be binding on and shall ensure for
      the benefit of each of the Parties' successors and permitted assigns. Any
      reference in this Agreement to any of the Parties shall be construed
      accordingly.

              


      

       

      
        	
                8.4.
      

              	
                Further Assurance:
      At any time after the date of this Agreement, each of the Parties
      shall, and shall use its best endeavors to procure that any necessary
      third party shall, execute such documents and do such acts and things as
      any other Party may reasonably require for the purpose of giving to such
      other Party the full benefit of all the provisions of this
      Agreement.

              


      

       

      
        	
                8.5.

              	
                Remedies: No
      remedy conferred by any of the provisions of this Agreement is intended to
      be exclusive of any other remedy which is otherwise available at law, in
      equity, by statute or otherwise, and each and every other remedy shall be
      cumulative and shall be in addition to every other remedy given hereunder
      or now or hereafter existing at law, in equity, by statute or otherwise.
      The election of any one or more of such remedies by any Party shall not
      constitute a waiver by such. Party of the right to pursue any other
      available remedies.

              


      

       

      
        	
                8.6.

              	
                Severability of
      Provisions: If any provision of this Agreement is held to be
      illegal, invalid or unenforceable in whole or in part in any jurisdiction,
      this Agreement shall, as to such jurisdiction, continue to be valid as to
      its other provisions and the remainder of the affected provision; and the
      legality, validity and enforceability of such provision in any other
      jurisdiction shall be unaffected.

              


      

       

      
        
          	
                  8.7.

                	
                  

                    Governing Law:
      This Agreement shall be governed by, and construed in accordance
      with, the laws
      of the British Virgin
Islands.

                  

                


        

         

      

      
        	
                8.8.

              	
                Dispute Resolution:
      In the event of any dispute, claim or difference (the "Dispute") between any
      Parties arising out of or in connection with this Agreement, the Dispute
      shall be resolved in accordance with the
  following:

              


      

       

      
        	
                (a)  

              	
                Negotiation
      between Parties; Mediations. The Parties agree to negotiate in good
      faith to resolve any Dispute. If
      the negotiations do not resolve the Dispute to the reasonable
      satisfaction of all parties within thirty (30) days, subsection (b) below
      shall apply.

              


      

       

      
        	
                (b)  

              	
                Arbitration.
      In the event the Parties are unable to settle a Dispute in
      accordance with subsection (a) above, such Dispute shall be referred to
      and finally settled by arbitration at Hong Kong International Arbitration
      Centre in accordance with the UNCITRAL Arbitration Rules (the "UNCITRAL Rules")
      then in effect, which rules are deemed to be incorporated by
      reference into this subsection (b). The arbitration tribunal shall consist
      of three arbitrators to be appointed according to the UNCITRAL Rules. The
      language of the arbitration shall be
English.

              


      

       

      
        	
                8.9.

              	
                Counterparts:
      This Agreement may be signed in any number of counterparts, all of
      which taken together shall constitute one and the same instrument. Any
      Party hereto may enter into this Agreement by signing any such
      counterpart.

              


      

       

      [SIGNATURE
PAGE(S)
FOLLOW]

      


      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      IN WITNESS WHEREOF the Parties
hereto have executed this Agreement on the date first above
written.

       

      The Transferor

       

      By: /s/
Brian Pak-Lun
Mok              


      Name: Brian Pak-Lun Mok

       

      
      

       

      The
Transferee

       

      By: /s/ Mr. Chunfeng
Tao                    


      Name: [ Mr. Chunfeng Tao]

       

       

       

       

       

       

       

       

       [SIGNATURE
PAGE TO INCENTIVE OPTION AGREEMENT]