Document:

ex10_1.htm

    Exhibit
10.1

    

    AMENDMENT
NO. 1 TO 8% SECURED DEBENTURE

    

    This AMENDMENT NO. 1 TO 8% SECURED
DEBENTURE (this “Amendment”) is made and entered into this 5th day of March,
2009 by and between China North East Petroleum Holdings Limited, a Nevada
corporation (the “Company”), and Lotusbox Investments Limited, an entity
organized under the laws of Singapore (“Lotusbox”).  Capitalized terms
used herein but not defined herein shall have the meaning set forth for such
terms in the Debenture.

    

    WHEREAS, the Company issued a 8%
Secured Debenture to Lotusbox on February 28, 2008 (the “Debenture”) pursuant to
the Securities Purchase Agreement by and between the Company and Lotusbox on
even date therewith.

    

    WHEREAS, pursuant to Section 5(c) of
the Debenture, Lotusbox is entitled to require that the Company pay any portion
or all of the principal and accrued interest on the Debenture at anytime
following 10 days’ written notice to the Company in the event that the Company
fails to effect a listing on either the American Stock Exchange or NASDAQ for
the Common Stock by the date which is 12 months after the Original Issue Date of
the Debenture (the “Original Listing Deadline”).

    

    WHEREAS,
the Company does not expect to effect a listing on the American Stock Exchange
or NASDAQ by the Original Listing Deadline.

    

    WHEREAS, the Company and Lotusbox
desire to amend the Debenture on the terms set forth herein.

    

    NOW, THEREFORE, in consideration of the
foregoing and the respective representations, covenants and agreements set forth
below, the parties agree as follows:

    

    1.           Extension of Company’s
Listing Obligation.  Lotusbox hereby agrees to extend the
Original Listing Deadline until August 30, 2010 (the “Revised Listing Deadline”)
and agrees that until the date of the Revised Listing Deadline it will not
enforce its rights to demand payment on any portion of the principal and accrued
interest pursuant to Section 5(c) of the Debenture other than as set forth in
Section 2 of
this Amendment.  For the avoidance of doubt, the parties agree and
acknowledge that all payments, fees and penalties set forth in the Debenture,
other than those set forth in Section 2(a) and Section 5(c), shall remain in
full force and effect.

    

    2.           Revision of Schedule of
Repayment.  Section 2(a) of the Debenture shall be restated in
its entirety as follows:

     

     
(a)           Principal
Payment.  The principal amount of this Debenture shall be payable as
follows:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        
          
            	
                    Repayment
      Date

                  	
                    Repayment
      Amount

                  
	 
      	 
      
	
                    August
      28, 2008

                  	
                    $750,000

                  
	 
      	 
      
	
                    March
      28, 2009

                  	
                    $1,250,000

                  
	 
      	 
      
	
                    June
      28, 2009

                  	
                    $1,250,000

                  
	 
      	 
      
	
                    September
      28, 2009

                  	
                    $1,250,000

                  
	 
      	 
      
	
                    December
      28, 2009

                  	
                    $1,250,000

                  
	 
      	 
      
	
                    March
      28, 2010

                  	
                    $1,875,000

                  
	 
      	 
      
	
                    August
      28, 2010

                  	
                    $2,500,000

                  
	 
      	 
      
	
                    February
      28, 2011

                  	
                    $2,500,000

                  
	 
      	 
      
	
                    August
      28, 2011

                  	
                    $1,500,000

                  
	 
      	 
      
	
                    February
      28, 2012

                  	
                    $875,000

                  
	 
      	 
      
	
                    Total
      Principal Payment

                  	
                    $15,000,000

                  

          

        

      

    

    

    3.           Issuance of
Warrants.  The Company shall issue to Lotusbox warrants to
purchase: (a) 250,000 shares of Common Stock at a per share exercise price of
$2.00, and (b) 250,000 shares of Common Stock at a per share exercise price of
$2.35 (collectively, the “Warrants”).  The term of the Warrants shall
be four years from the date of issuance.  The Warrants shall be
substantially in the form attached hereto as Exhibit A.

    

    4.           Delivery of
Warrants.  The Company shall cause a copy of the Warrants to be
delivered by facsimile to Lotusbox upon execution of this
Amendment.  The originally executed Warrants shall be delivered by the
Company to Lotusbox no later than seven days following the execution of this
Amendment to:

    

    Lotusbox
Investments Limited

    c/o 137,
Telok Ayer Street

    #04-04/05

    Singapore
068602

    Attn:  Diana
The

     

    
      
        
        

      

      
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    5.           Representations and
Warranties.  The Company hereby makes the following
representations and warranties to Lotusbox:

    

    (a) the representations and warranties
of the Company set forth in Section 3.1 of the Purchase Agreement are true and
correct in all respects as of the date of this Amendment, except as set forth on
Exhibit B
attached hereto;

    

    (b) the Company has the requisite
corporate power and authority to enter into and to consummate the transactions
contemplated by the Amendment and otherwise to carry out its obligations
hereunder.  The execution and delivery of the Amendment by the Company
and the consummation by it of the transactions contemplated hereby have been
duly authorized by all necessary action on the part of the Company and no
further action is required by the Company, its board of directors or its
stockholders in connection therewith; and

    

    (c) the Warrants are duly authorized
and, upon issuance, delivery and payment, will be legally binding obligations of
the Company.  The shares of Common Stock issuable upon exercise of the
Warrants have been duly and validly authorized and reserved for issuance and
upon issuance, delivery and payment, will be validly issued, fully paid and
non-assessable.

    

    6.           Legal
Fees.  The Company shall pay the legal fees incurred by
Lotusbox in connection with the transactions contemplated hereby, which shall
not exceed $5,000.

    

    7.           Additional Event of
Default.  It shall be an
“Event of Default” pursuant to Section 7 of the Debenture if at any time after
the second anniversary of the date hereof, there is no effective registration
statement, or no current prospectus available for, the resale of the shares of
Common Stock issuable upon exercise of the Warrants.  If such Event of
Default occurs, the Company shall reimburse Lotusbox for all fees and expenses
incurred by Lotusbox in connection with enforcing its rights and remedies under
the Purchase Agreement and the Debenture and under applicable law.

    

    8.           No Other Changes.  Except as
amended hereby, all other terms of the Debenture shall remain unmodified and in
full force and effect.

    

    

    [SIGNATURE
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    IN WITNESS WHEREOF, the parties hereto
have executed and delivered this Amendment on the day and year first above
written.

     

    
      
        
          
            
              	
                      China
      North East Petroleum Holdings Limited

                    	 
      	
                      Lotusbox
      Investments Limited

                    	 
	 
      	 
      	 
      	 
      	 
      	 
	 
      	 
      	 
      	 
      	 
      	 
	
                      By:

                    	
                      /s/
      Wang Hongjun

                    	 
      	
                      By:

                    	/s/
      Suresh Withana  	 
	 
      	
                      Wang
      Hongjun

                    	 
      	 
      	
                      Name:
      Suresh Withana

                    	 
	 
      	
                      Chairman
      and President

                    	 
      	 
      	
                      Title:
      Director

                    	 

            

          

        

      

    

     

     

     

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Exhibit
A

    

    Form
of Warrant

     

     

     

     

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Exhibit
B

    

    Representations
and WarrantiesEX-10.36

	 	 	 	 	 
	To:
	 	Date:

	 	March 3, 2009
	Subject:
	 	The Andersons, Inc.

2009 Performance Share Unit Grant Letter of Agreement

	 	

You have been selected to receive a Performance Share Unit (the “PSUs”) grant subject to the terms
and conditions of the Long Term Performance Compensation Plan (the “Plan”) and this Letter of
Agreement (the “Agreement”). This Agreement will document the key provisions relating to the PSUs
granted to you as of March 2, 2009.

Before executing this Agreement by signing the attached Acknowledgment of Receipt (the
“Acknowledgment”), please read the information provided below regarding the specific provisions of
your 2009 PSUs. A copy of the Plan is available upon request from the Human Resources Department.
By signing the Acknowledgment, you declare having read this Agreement and agree to be bound by all
the terms and conditions contained herein. When you are satisfied that you understand the terms
and conditions of the PSU grant, please sign the attached Acknowledgment and, return to Teresa
Scott or Steve DeDonato in the Human Resources Department by Monday, March 16, 2009. Remember to
keep a copy for your files.

	 	1.	 	Grant of Performance Share Units: Subject to the terms and conditions of the Plan and
this Agreement, The Andersons, Inc. (the “Company”) hereby grants to you «RSPSU» PSUs.
Each PSU shall be equivalent to one Common Share of the Company.

	 	2.	 	Performance Period: The Performance Period for the PSUs granted shall be the three
year period beginning January 1, 2009 and ending December 31, 2011.

	 	3.	 	Performance Schedule and Vesting of PSUs: PSUs shall vest at the conclusion of the
Performance Period (January 1, 2012) in accordance with the following Performance Schedule
based on the Company’s three-year cumulative fully diluted Earnings Per Share (“EPS”)
computed under Generally Accepted Accounting Principles (GAAP) during the Performance
Period. The Compensation Committee of the Board of Directors reserves the right to adjust
the EPS presented in the annual report for extraordinary transactions which impact EPS to
ensure the pay for performance relationship. No PSUs will be considered vested and earned
for payment if the Company’s three-year cumulative EPS during the Performance Period is
less than $6.37.

	 	*	 	 The target performance level is 7% annual growth above EPS at 2009
target income. The threshold performance level is 3% annual growth above EPS at 2009
plan income. The maximum performance level is 14 % growth above EPS at 2009 target
income. At target cumulative EPS growth 100% of performance adjusted target long-term
compensation is achieved, which is equal to 50% of the PSUs granted to you under this
agreement. The “% Units Vested” at maximum performance level achieves 200% of
performance adjusted target long-term compensation, which is equal to 100% of the PSUs
granted to you under this agreement.

You must be actively employed by the Company as of the end of the Performance Period to
be eligible to vest in and receive any payment of your PSUs except as noted in paragraph 7
below. Actual vested percentage rates will be interpolated from the above Performance
Schedule using the actual three-year cumulative fully diluted EPS achieved at the end of the
Performance Period.

	 	4.	 	Rights as a Shareholder: You shall have no rights as a shareholder with respect to
the Common Shares subject to the PSUs granted to you during the Performance Period
including the right to receive dividends or to vote the Common Shares subject to the PSUs.

	 	5.	 	Equivalent Dividends: If any dividends are paid with respect to Commons Shares of the
Company during the Performance Period, additional PSUs will be granted to you as of the
last day of the Performance Period. The amount of additional PSUs will be computed based
on the cumulative per share dividend rate actually paid on Common Shares during the
Performance Period and the share price on the last day of the Performance Period.
Additional PSUs granted to you, if any, shall be subject to the terms and conditions of the
Plan and this Agreement and will vest in accordance with the Performance Schedule defined
in this Agreement.

	 	6.	 	Payment of Earned PSUs: Vested PSUs rounded up to the nearest whole unit shall be
delivered to you in the form of Common Shares no later than 75 days following the
conclusion of the Performance Period. PSUs which do not vest as of the last day of the
Performance Period will be forfeited. In that regard, you agree that you will comply with
(or provide adequate assurance as to future compliance with) all applicable securities
laws. In addition, the Company must receive from you payment or a written request for
arrangement of terms for payment, including share withholding, of all federal, state or
local taxes of any kind required to be withheld with respect to the vesting of Shares as
condition precedent to the delivery of the Shares. Shares are subject to tax withholding
based on the market value of the Shares on the date of vesting (i.e., closing price on the
business day prior to the date of vesting) at required withholding tax rates. Withholding
taxes due, if not satisfied in shares, must be paid in full within ten business days of the
vesting date.

	 	7.	 	Termination and Forfeiture of PSUs: Your right to receive unvested PSUs shall terminate
in whole and forfeit upon your termination of employment with the Company or its
subsidiaries for any reason, except in the event of your death, Permanent Disability,
Retirement, or Termination without Cause as a result of a Sale of your Business Unit. If
your termination with the Company meets one of the listed exceptions, then your unvested
PSUs will remain subject to the Performance Schedule during the Performance Period provided
in this Agreement and the number of your PSUs subject to vesting at the end of the
Performance Period will be reduced proportionate to the number of months rounded to the
nearest whole month you were actively employed during the Performance Period.

	 	8.	 	Other Acknowledgments: You acknowledge that the Compensation Committee may adopt and/or
change from time to time such rules and regulations as it deems proper to administer the
Plan.

	 	9.	 	Binding Effect: This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective heirs, executors, administrators, successors and
assigns.

 Thank You,

Arthur D. DePompei

Vice President, Human Resources

The Andersons, Inc.

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