Document:

Framework Agreement of Land Transfer

 

Party A: The People’s Government of Mashan Town, Changqing District

Party B: Shandong Sino-Green TCM Tech Development Co., Ltd.

 

In accordance with the Law of the People’s Republic of China on Land Contract in Rural Areas, Measures for the Administration of Circulation of Rural Land Contracted Management Right and Measures on Implementing ‘the People’s Republic of China on Land Contract in Rural Areas in Shandong Province, and relevant laws, regulations and national policies, Party A and Party B reached the Contract through negotiation based on the principle of fairness, volunteer and value, to speed up the construction process of TCM herbs planting base of Party B.

 

	
  

	
I.

	
Status and purpose of transferred land

 

	
  

	
1.

	
Purpose of transferred land

Party A transfers 12 administrative villages in Mashan Town totaling 2142.345 Chinese mu (352.9 acres) with operation right to Party B for the construction, production and operation of TCM herbs planting base.

	
  

	
2.

	
Term of transfer

The term of transfer is 30 years.

	
  

	
3.

	
Land transfer cost and payment way

The transfer cost shall be turned into the wheat yield, which shall be converted into the cash according to the local wheat market purchase price: For dry land, it shall be converted with 600 jin wheat per Chinese mu per year; for irrigable land, it shall be converted with 800 jin wheat per Chinese mu per year; it will make change for once every five year, and it shall regard the wheat purchase price issued by the state in May of the first year for each period as the base price. The wheat price is calculated by RMB 1.05 per jin from 2011 to 2015, namely, Party B shall pay the transfer cost of RMB 630 per Chinese mu for the dry land to Party A, and RMB 840 per Chinese mu for the irrigable land.

Note: The transfer cost for dry land in spring in 2011 of Party B shall be prepaid by the area of 2142.345 Chinese mu (352.9 acres) reported by Party A currently, and the land price is RMB 630 per Chinese mu, with the total amount of RMB 1.349677 million. The land area will be measured by Party B, and then it will make the settlement according to the actual situation. If it pays for extra, the extra part shall be deemed as the rent of newly-increased transfer land as the wheat harvest in summer.

	
  

	
II.

	
Rights and obligations of Party A

	
1.

	
Party A has right to receive the land transfer cost in accordance with the Contract, and take back the operation right of the land abiding by the Contract term.

	
2.

	
Party A has right to supervise Party B to reasonably utilize and protect the transfer land, and prevent Party B to damage the land and other agriculture resources; and it also has right to request Party B to compensate the losses caused herein.

	
3.

	
If the transfer land is expropriated, requisitioned and occupied, Party A has right to obtain the relevant land compensation right.

 

  

  

  

	
4.

	
Party A shall assist Party B to execute the land use right according to the Contract, and Party A shall not intervene in the normal production and operation activities of Party B; Party A shall provide stable social environment for the production and operation of Party B.

	
  

	
III.

	
Rights and obligations of Party B

	
1.

	
Patty B has the independent operation right, product disposal right and earning right of the transfer land, and it shall engage in the operation activities within the scope approved by state laws and regulations and policies.

	
2.

	
Party B has right to use the current water resource and build the water project within the scope of contracting land; it has the priority to use the current water facilities within the scope of contracting land and the future water facilities invested and constructed by the state.

	
3.

	
If the land is expropriated and occupied during the transfer period, Party B has right to obtain the relevant compensations for green crops and ground fixtures under construction.

	
4.

	
Party B shall pay the land transfer cost timely according to the Contract.

	
5.

	
Party B shall not independently change the agricultural purpose of the land, and it shall not abandon the land, waste the land, engage in the predatory operation, and cause the permanent damage of the land.

	
6.

	
After the land transfer period expires, Party B shall return the land to Party A timely; if the land needs to be used in continuity, Party B shall have the priority under the same conditions.

	
7.

	
Party B shall get the approval of Party A and the town government, and sign the written supplementary agreement if it intends to transfer entire or part of rights to the third party.

IV. Other matters

	
1.

	
During the lease term, if the contract needs to be terminated owing to force majeure factors, Party A or Party B has right to terminate the agreement. If Party A terminates the agreement in advance, it shall notify Party B before it puts into the production; if Party B terminates the agreement in advance, it shall notify Party A before it puts into the production, in order to avoid the economic loss.

	
2.

	
The disputes aroused herein shall be solved through negotiation; if it fails to be solved in this way, any party shall make lawsuits to the local people’s court or apply for arbitration in Jinan Arbitration Committee.

	
3.

	
This Contract will take effect from April 29, 2011.

	
4.

	
The unsettled matters herein shall be solved through negotiation. This Contract has two copies, with Party A and Party B holding one respectively.

Party A: The People’s Government of Mashan Town, Changqing District

Legal representative (signature): Xu Bing

Date: April 29, 2011

Party B: Shandong Sino-Green TCM Tech Development Co., Ltd.

Representative (signature): Lv Yanming

Date: April 29, 2011Land Contracting Operation Rights Transfer Contract

Party A: Shibali Town Government of Qiaocheng District, Bozhou City

Party B: Anhui Sino-Green TCM Tech Development Co., Ltd.

 

To promote the development of TCM industry in Bozhou City, and strengthen the construction of standard quality TCM base, Global Pharm Holdings Group and Shibali Town Government have negotiated to reach this Contract based on the principle of equality and mutual benefits, in accordance with the laws and regulations of rural land contracting:

 

	
I.

	
Land transfer term, area and place

 

	
1.

	
The land transfer term is 10 years.

	
2.

	
Land transfer area:

From 2011 to 2013, the total land transfer area is 20,000 Chinese mu, including three phases:

1st phase: Land transfer of 2,000 Chinese mu on June 10, 2011;

2nd phase: Land transfer of 8,000 Chinese mu on Oct. 10, 2011/7/18;

3rd phase: Land transfer of 10,000 Chinese mu from 2012 to 2013.

	
3.

	
Land transfer place:

The land transfer place is located in Xuzhai Village, Yuji Village and Maying Village (North Administrative village to No. 311 National Highway), Shibali Town, Qiaocheng District, Bozhou City.

	
II.

	
Payment of land transfer fees

 

	
1.

	
The land transfer fees are: 450 kg/Chinese mu×price of wheat (Party B shall convert into cash according to the minimum price announced by relevant national department at that year).

The 1st phase transfer fee for 2,000 Chinese mu land shall be paid before May 20, 2011.

The 2nd phase transfer fee for 8,000 Chinese mu land shall be paid before Sep. 20, 2011.

The 3rd phase transfer fee for 10,000 Chinese mu land shall be paid in 2010.

	
2.

	
The deposit for land transfer is RMB 50,000/1,000 Chinese mu.

 

1st phase (2,000 Chinese mu): The deposit of RMB 10,0000 for 2,000 Chinese mu transfer land shall be paid within 10 days after signing this Contract; after transferring, the deposit shall be regarded as the land transfer fee automatically (the same below).

 

2nd phase (8,000 Chinese mu): The deposit of RMB 400,000 for 8,000 Chinese mu transfer land of October of 2011 shall be paid in July of 2011.

 

3rd phase (10,000 Chinese mu): The deposit of RMB 500,000 for 10,000 Chinese mu transfer land of 2012 to 2013 shall be paid in 2012.

 

  

  

  

	
III.

	
Others

	
1.

	
The agricultural infrastructure like channel, well and electricity shall be implemented by the local Agriculture Development Office according to the total planning of the sample area.

	
2.

	
The unsettled matters herein shall be supplemented through fair negotiation of the two parties, and the supplementary contents have the same legal effect with the Contract.

	
3.

	
After paying the deposit, the enterprise shall arrange the professional personnel within one week to coordinate the works with the village personnel.

	
4.

	
This Contract will take effect after signing of the two parties; the Contract has 5 copies, with Party A and Party B holding two respectively, and Bozhou Government Office holding one.

Party A: Shibali Town Government of Qiaocheng District, Bozhou City

Representative: Sun Wei

Party B: Anhui Sino-Green TCM Tech Development Co., Ltd.

Representative: Shao Dan

Date: Mar. 31, 2011Merger & Acquisition Agreement

 

Party A: Lv Xinjuan    ID No. 370831198208100763;

 

               Kong Lingjin   ID No. 370831198210100711;

 

Party B: Taian Senlin Pharmaceutical Co., Ltd.

 

Party C: Shandong Global Pharm Co., Ltd.

 

Whereas:

 

Party B, the limited liability company with going-concern basis, is incorporated under the Company Law of the People's Republic of China and relevant laws and regulations. The natural persons of Party A are the shareholders of Party B, thus they held 100%equity of Party B (Taian Senlin Pharmaceutical Co., Ltd.).

 

The registered capital of Party B is RMB 5 million. Lv Xinjuan contributes for RMB 3.8 million, which reflects 76% of Party B’s equity ownership; Kong Lingjin contributes for RMB 1.2 million, which reflects 24% of Party B’s equity ownership.

 

Based on the Company Law of the People's Republic of China and relevant laws and regulations, Party B established the limited liability company with going-concern basis. The basic information is as follows:

 

Name: Taian Senlin Pharmaceutical Co., Ltd.

 

Registered address: No. 1 Oukai Road, Taishan District, Taian City

 

Industrial & commercial registration No.: 370903228255753

 

Operation scope: Wholesales of Chinese patent medicine, traditional Chinese medicine, Chinese medicine pieces, chemical raw material medicine, chemical medicine preparations, antibiotics, biochemistry products, biological products (excluding vaccine) (expiration date of the license is February 5, 2011), and Class II and III medical instruments (excluding contact lenses and its solution, in-vitro diagnostic reagent, 6848 implant materials, artificial organs and 6877 accessing instruments) (expiration date: April 13, 2015); sales of daily washing products; common goods transportation (expiration date: June 23, 2013).

 

  

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Based on the Company Law of the People's Republic of China and relevant laws and regulations, Party C established the limited liability company with going-concern basis. The basic information is as follows:

 

Name: Shandong Global Pharm Co., Ltd.

 

Registered address: No. 80 Jiangjun Road, Jinan City

 

Industrial & commercial registration No.: 370100000030386

 

Operation scope: Wholesales and import & export of Chinese patent medicine, traditional Chinese medicine, Chinese medicine pieces, chemical raw material medicine, chemical medicine preparations, antibiotics, biochemistry products, biological products(excluding vaccine); prepackaged food; Class I, II and III medical instruments (excluding contact lenses and its solution, in-vitro diagnostic reagent, corneal contact lens for orthokeratology), medical package materials, disinfection-related products, cosmetics, daily supplies and general merchandises; common goods transportation; planting of plants used for drugs; software development; sales of company products; consultancy of medical and economic information.

 

Party C proposes to acquire 100% of Party B. After friendly negotiation, Party A, Party B and Party C reach this agreement and promise to comply with it.

 

Article 1: M&A contents and payment;

 

	
1.

	
Party C acquires the equities of Party B that was held by Party A’s natural persons.

 

	
2.

	
The three parties confirm that Party C shall base on the acquisition consideration upon the final appraisal result indicated in the appraisal report, which is issued by the qualified independent assets appraisal firm commonly engaged by Party B and Party C. Party C will pay the acquisition consideration to Party B’s shareholders pro rata.

 

Article 2: Payment of M&A

 

	
1.

	
When signing the agreement, Party C shall remit RMB 0.5 million to Party B’s account as the deposit, and Party B shall return the deposit without conditions if the agreement is not concluded; after paying of the deposit, Party B will not return the deposit if the acquisition is not carried out due to Party C’s withdraw. After signing of the agreement, the deposit can be transferred as the acquisition consideration of Party C.

	
2.

	
After signing the agreement, Party A and Part B shall handle the changing procedures of Business License to the local industrial and commercial administrative organization within 5 working days.

	
3.

	
Party C shall pay the acquisition consideration to Party A as below based on the current registered capital of Party B in advance: After Party A & B finishing the industrial and commercial procedures of equity change, Party C shall pay 100%’s acquisition consideration at one time within 15 working days after receiving the new Business License in 2011

 

  

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Article 3: Party B and Party C shall sign a separate agreement for the compensation for the operation & management of Party B.

 

Article 4: Commitments of Party A and Party B

 

	
  

	
1.

	
Party A and Party B shall guarantee that all the signing documents shall be based on the will of the relevant parties and be legal, and the signed documents shall not violate the following documents: The Articles of Association of Party B; any major contracts of Party A and/or Party B; related laws, administrative regulations and other normative documents.

	
  

	
2.

	
All the equities related to Party A and Party B’s rights and interests shall be complete and impeccable; and the shareholder’s will shall not be controlled by other individuals, teams and units. Party A and Party B have indicated clearly about this matter.

	
  

	
3.

	
If Party B, Party B’s holding subsidiary and the company that Party B owns 20% equity, the company of which Party B actually controls, and the company of which Party B is the actual beneficiary, fail to repay to the creditor or repay with overdue, Party A and Party B shall disclose this situation to Party C in written .

	
  

	
4.

	
Otherwise agreed by Party C in written, after signing the Agreement, Party B shall not have the following behaviors:

 

(1) Repay debts in advance;

 

(2) Set mortgage guarantee and pledge to its property or provide guarantee to any third party;

 

(3) Discharge debt of any other person or give up right of claim of any debt;

 

(4) Modify any existing contract or agreement without agreement or requirement of Party C;

 

(5) Have any material change related to the management or employee, and the change will cause material adverse effects to the company;

 

(6) The signing of business contract with over RMB 0.3 million shall be agreed by Party C in advance;

 

(7) Change the registered capital of the company or the relevant rights, or adopt or agree with any act which may cause the change;

 

(8) Issue any bond, loan or financing;

 

(9) Conclude any substantial contract or capital commitment, or assume any limited liability not for the purpose of normal business;

 

(10) Announce, pay or issue dividend or other distribution;

 

(11) Change basic business of the company;

 

(12) Issue loan to the external party;

 

  

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(13) Purchase any non-cash asset substantially;

 

(14) Change the company investment plan substantially;

 

(15) Or any other act or omission may cause the occurrence of the above situations.

 

5. After the Agreement is signed and takes effect, if the liability (such as economic and guarantee liabilities) occurred before signing the Agreement and shall be assumed by Party B is found, and the liability or the guarantee is not notified to Party C in written before signing the Agreement, it shall be assumed by Party A.

 

6. Party B and its subsidiaries or joint venture and holding company (if any) have no pending litigation or arbitration, and judgment or adjudication currently. If there is situation not notified to Party C and the liability aroused by the litigation and arbitration execution influences the interest of Party B, the responsibility shall be assumed by Party A.

 

Article 5: Commitments of Party C

 

1. Party C is a validly existing limited company established legally and has all necessary civil rights and capacity to sign and perform all obligations and responsibilities of the Agreement.

 

2. The signing and performance of the Agreement has obtained or will obtain all necessary authorization, and it does not violate the articles of association of Party C.

 

3. After Party C finishing M&A, Party C appoints Party A to take charge of the operation and management of Party B according to the Agreement, and the current general manager of Party B remains unchanged with a three-year term of office (for the occurrence of criminal case and accidental injury, Party C has the right to assign new general manager in advance). Party C shall be responsible for implementing training on laws and regulations to the company director, supervisor and senior management, assisting in Party B establishing and perfecting the board of directors and board of supervisors according to requirements of modern enterprise system, and guiding to establish the system and document related to corporate governance structure.

 

Article 6: Arrangement of Party B’s director, supervisor and senior management

 

1. After Party C finishing the M&A, for the assignment and appointment of Party B’s director, supervisor, and senior management like general manager and financial director, Party C shall release letter of assignment and appointment.

 

2. Party C can authorize the general manager of Party B to employ the senior management and middle management (deputy general manager and middle-level manager), but the employment can be executed after being approved by Party C and it shall accept the vertical management of Party C in business.

 

  

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3. Party B shall establish perfect corporate governance system and strictly carry out according to the local laws and regulation, and the actual situation of the company.

 

Article 7: Document transfer procedures after the M&A

 

After finishing the M&A of Party B, Party A agrees to coordinate with Party C to finish the appointment procedures of the new management and Party A shall be responsible for transferring the following documents and articles to the new management of Party B.

 

	
1.

	
All seals of Party B, including official seal, financial seal, contract seal and bank account seal of Party B;

	
2.

	
All archival data of the company, including but not limit to the industrial and commercial registration data, original of business license, original of tax registration certificate, historical shareholder meetings, minutes of board of directors, complete board of shareholders, resolution documents of the board of directors, HR data, all business data, and all contracts has been performed or is performed;

	
3.

	
Accounting books and accounting documents of the company.

 

Article 8: Confidentiality

 

1. The parties concerned shall keep the content of the Agreement, the relevant commercial operation and transaction confidential. Except for the disclosure that is regulated by laws or required by the government competent departments, any party shall not disclose the existence and the content of the Agreement, and the financial data and document material and business secret of Party B and Party C before signing the Agreement to any third party without written permission of other parties in advance.

 

2. Each party shall guarantee that the law office, accounting firm and other intermediary organization employed or consulted by them keep the content of the Agreement, the relevant commercial operation and transaction confidential. It is unnecessary for each party keeping confidential to their affiliate organization.

 

Article 9: Liability for breach of contract

 

1. If Party C fails to acquire Party B within the time agreed, Party C shall be responsible for stripping all assets of Party B from Party C and returning to Party A unconditionally.

 

2. If Party C fails to pay all money according to the agreement, Party A has the right to apply for compulsory execution to the court with jurisdiction and all expenses aroused by compulsory execution shall be assumed by Party C.

 

3. After signing the Agreement, the liabilities occurred before signing the Agreement and not disclosed to Party C by Party A (including liabilities aroused by guarantee and lawsuit) shall be assumed by Party A.

 

  

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4. After signing the Agreement, otherwise agreed by Party C in written, if Party A and Party B violate the regulation in Item 4 of Article 4 of the Agreement, the responsibility shall be assumed by Party A.

 

5. After the Agreement is signed and takes effect, if any party fails to perform or completely perform the terms of the Agreement, it is deemed as the breach of contract and the default party shall compensate for the economic loss of the observant party aroused by its noncompliance.

 

Article 10: Amendment of agreement

 

The amendment of the Agreement shall be signed as the written amendment agreement after being jointly negotiated by the three parties concerned.

 

Article 11: Applicable laws and dispute solution

 

	
1.

	
The Agreement is governed by the related laws and regulations of the People’s Republic of China.

	
2.

	
Any dispute or disagreement aroused by the Agreement or related to the Agreement shall be solved by the partied concerned through friendly negotiation; if the negotiation fails, it shall be solved by the court through lawsuit.

 

Article 12: Others

 

	
1.

	
The Agreement shall come into force after being signed by the parties concerned.

	
2.

	
The Agreement has six copies, with each party holding two respectively, covering equal legal force.

 

  

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This page is intentionally left blank without body text, for signature only.

 

Parties concerned:

 

Party A: Lv Xinjuan and Kong Lingjin (shareholders of Party B)

 

Party B: Taian Senlin Pharmaceutical Co., Ltd.

 

Representative: Lv Xinjuan

Party C: Shandong Global Pharm Co., Ltd.

 

Representative: Song Yanliang

 

Signing place: Jinan City of Shandong Province

 

Signing date: May 25, 2011

 

  

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