Document:

ex10-1.htm - Generated by SEC Publisher for SEC Filing

 

 

 

 

DATED THE 17th DAY OF February 2014

 

 

 

 

 

VERDE RESOURCES, INC.

 

AND

 

FEDERAL MINING RESOURCES LIMITED

 

AND

 

GOLD BILLION GLOBAL LIMITED

 

 

 

 

 

 

 

SUPPLEMENTARY AGREEMENT 

 

TO

 

ASSIGNMENT AGREEMENT

 

FOR THE ASSIGNMENT
OF MANAGEMENT RIGHTS IN

 

MERAPOH GOLD MINES IN MALAYSIA

 

                                                                         

 

 

THIS
AGREEMENT is made on the 17th day of February 2014.

 

BETWEEN:

 

VERDE RESOURCES, INC., a company incorporated in Nevada, USA having a company registration number
27-2448672 and its principal
executive offices at Unit 1503, 15/F., The Phoenix, 21-25
Luard Road, Wanchai, Hong Kong (hereinafter
"the Assignee").

 

AND

 

FEDERAL MINING RESOURCES LIMITED, a company incorporated in British
Virgin Islands having a company registration
number 1603878 and its registered office address at P.O.
Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin
Islands (hereinafter
"the Assignor").

 

AND

 

GOLD BILLION GLOBAL LIMITED, a company incorporated in British
Virgin Islands having a company registration
number 1759774 and its registered office address at P.O.
Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin
Islands (hereinafter
"the Subsidiary").

 

WHEREAS:

 

A.     
The Assignor owns
85% equity interest in CHAMPMARK SDN BHD (Company No. 235619-U), a private
limited liability company incorporated in Malaysia under the Companies Act,
1965 and having its registered office at G-1-10, Kuchai Business Park, Jalan
1/127 off Jalan Kuchai Lama, 58200 Kuala Lumpur, Malaysia (hereinafter referred
to as “Champmark”). 

 

B.     
Champmark is the Mining Contractor of the Mining Lease No. ML 08/2008 for
Site IV-1 estimated to contain a total of 400 acres at the Merapoh Gold Mine
under the Contract of Work dated 21st July 2004 with MMC Corporation
Berhad (“MMC”), the Permit Holder of the Mining Lease.
There are 6 other sites, in addition to Site IV-1, at the final stage of
approval for mining licenses.

 

C.     
The Assignor set up
a subsidiary company Gold Billion Global Limited (the Subsidiary) on the 7th
February 2013. Under a mutual agreement between the Assignor
and the Assignee, the Assignor agreed
to transfer the
Subsidiary to the Assignee on 18th October 2013 and was completed on 25th
October 2013. 

                                                                         

 

 

 

D.     
The Assignee through the Subsidiary, agrees to accept and the Assignor agrees to assign its management
rights of Champmark’s mining operation at the
Mining Lease (hereinafter "the Management Rights") from
the Assignor on the terms and conditions hereinafter
appearing. Champmark shall remain to be the Mining Contractor of the Mining
Lease.

 

E.     
Subject to audit
of the Subsidiary and Board approval of the Parties, the Assignor and Assignee
enter into this Supplementary Agreement to clarify the rights and obligations and
terms and conditions of the
mutual agreement and to complete the acquisition of the Subsidiary. In addition to the Management Rights
in the Original Agreement, full control of the 85% interest in Champmark and
the additional rights and obligations as defined in Clause 2.1 are assigned to
the Assignee by the Assignor as per this Supplementary Agreement. 

 

NOW IT IS HEREBY AGREED AS FOLLOWS:

 

1      
INTERPRETATION 

1.1   
Definitions
 

In
this Supplemental Agreement, the following words and expressions shall have the
following meanings: 

“Entire Agreement” means the Original Agreement as
amended by this Supplemental Agreement; 

“Original Agreement” means the Assignment Agreement For
The Assignment Of Management Rights In
Merapoh Gold Mines In
Malaysia that was entered into on the 25th day of October 2013, between the Parties; 

“Parties” means the signatories to this
Supplemental Agreement; and 

“Supplemental Agreement” means this supplemental agreement. 

  

1.2   
One
agreement 

The
Original Agreement, together with this Supplemental Agreement, shall, with
effect on and from the date hereof, be read and construed as one document and
references in the Original Agreement to “this Agreement” shall from the date
hereof (but not for any purposes prior to the date hereof) incorporate
references to this Supplemental Agreement. 

  

 

                                                                         

 

 

1.3   
Terms
defined 

In
this Supplemental Agreement, unless the context requires otherwise, terms
defined in the Original Agreement and not otherwise defined herein, shall have
the same meanings in this Supplemental Agreement. 

  

1.4   
Immediate
effect 

The
amendments provided for in this Supplemental Agreement shall, save where
expressly provided to the contrary, take effect forthwith upon execution of
this Supplemental Agreement by the Parties. 

 

2      
AMENDMENTS & CLARIFICATIONS TO THE ORIGINAL AGREEMENT

 

2.1     
Assignment Of Additional Rights & Obligations

On July 1,
2013, the Assignor has assigned its rights and obligation on Champmark to the
Subsidiary. 

Champmark is a
deemed subsidiary of the Subsidiary where 

(i)           
the Subsidiary has
control the Board of Directors of Champmark and the right to appoint directors in Champmark to
represent the 85% shareholding in Champmark;

(ii)         
the Subsidiary has
rights to receive future benefits and residual value, and obligation
to absorb loss and finance for Champmark;

(iii)        
the Subsidiary has
the power to direct the activities of Champmark that most significantly impact
Champmark’s economic performance and the obligation to absorb losses of
Champmark that could potentially be significant to the Champmark or the right
to receive benefits from Champmark that could potentially be significant to
Champmark; and

(iv)        
the Subsidiary is
the primary beneficiary of Champmark because the Subsidiary can direct the
activities of Champmark through the common directors and 85% shareholder of the Assignor.

It is determined that Champmark is
de-facto agent of the Subsidiary and so the Subsidiary will consolidate
Champmark from July 1, 2013.   

Under the terms of the Assignment
Agreement, the Assignor has
assigned its management rights of Champmark’s mining operation in
the Mining Lease to the Subsidiary in exchange for 80,000,000 shares of the
Assignee’s common stock. 

The Subsidiary and its deemed
subsidiary become wholly-owned subsidiary and deemed 85% subsidiary of the
Assignee. The acquisition of 100% of the issued and outstanding capital stock
of the Subsidiary was completed subject to the approval of the Board
of Directors of the Parties and the audit of the Subsidiary.

                                                                         

 

 

 

2.2     
Reverse
Acquisition

The
Assignee as the legal parent shall be the accounting acquiree while the
Subsidiary shall be the accounting acquirer. There is a 15% non-controlling interest of Champmark after the
acquisition. 

This
transaction was accounted for as a recapitalization effected by a share
exchange, wherein the Subsidiary with its 85% deemed subsidiary Champmark was
considered the acquirer for accounting and financial reporting purposes. The
assets and liabilities of the acquired entity have been brought forward at
their book value and no goodwill has been recognized.

As a result of
the acquisition, the Assignee holds 100% equity interest in the Subsidiary and
85% variable interest in Champmark. The
Assignee’s consolidated
subsidiaries include the Subsidiary being
the Assignee’s wholly owned subsidiary and
85% of Champmark being a variable interest entity (VIE) and deemed subsidiary
of the Subsidiary. 

 

2.3    Amended
Wording 

The typographical
error for “Gold Billions Ltd.” in the Original Agreement shall be replaced with
“Gold Billion Global Limited”.

 

3      
COMPLETION

Subject to audit of the Subsidiary and Board approval of
the Parties, completion of the Supplementary Agreement shall take place on 17 February
2014.  

 

4      
WARRANTIES
AND REPRESENTATIONS

1     
  

2     
  

3     
  

4     
  

4.1     
The Assignor
hereby warrants and represents to the Assignee that the Assignor is the
beneficial owner of the Management Rights and is fully capable of entering into
this Agreement and to perform all obligations and duties hereunder without the
consent, approval, permission, license or concurrence of any third party save
as mentioned in this Agreement.

 

4.2     
The Assignee
hereby warrants and represents to the Assignor that the Assignee is fully
capable of entering into this Agreement and to perform all obligations and
duties hereunder without the consent, approval, permission,
license or concurrence of any third party save as mentioned in this
Agreement.

                                                                         

 

 

 

4.3     
The Subsidiary hereby
warrants and represents to the Assignee that the Subsidiary, being the principal
of Champmark and having complete authority to represent Champmark, is fully
capable of entering into this Agreement and to act on behalf of Champmark.

 

4.4     
Each of the
warranties and representations, undertakings and identities contained in
this Agreement will survive the completion of the assignment of the Management Rights.

 

4.5     
Prior to the
Completion Date, if any of the warranties, representations or undertakings
in this Agreement are found to be materially untrue, inaccurate or misleading
or have not been fully carried out in any material respect, or in the event
of the Assignor becoming unable or failing to do anything required under this Agreement
to be done by it at or before the Completion Date, the Assignee may by
notice in writing rescind this Agreement but without prejudice to any claim the Assignee
may have against the Assignor hereunder.

 

5      
TIME 

5.1     
Time shall be of
the essence of this Agreement.

5.2     
No time or
indulgence given by any party to the other party shall be deemed or in any way
be construed as a waiver of any of its rights and remedies hereunder.

 

6      
CONFIDENTIALITY 

Other than such
disclosure as may be required by law or any competent authorities,
neither of the parties hereto shall make, and the Assignor shall procure that
the Company will not make any announcement or release or disclose any information
concerning this Agreement or the transactions herein referred to or disclose
the identity of the other party (save disclosure to their respective professional
advisers under a duty of confidentiality) without the written consent of
the other patty.

 

7      
ASSIGNMENT 

This Agreement
shall be binding on and shall ensure for the benefits of the successors
and assigns of the parties hereto but shall not be assigned by any party without
the prior written consent of the other party.

 

                                                                         

 

 

8      
NOTICES AND
OTHER COMMUNICATION

Any notice or
other communication to be given under this Agreement shall be in writing
and may be delivered by hand or given by facsimile, telex or cable. Any such
notice or communication shall be sent to the party to whom it is addressed and
must contain sufficient reference and/or particulars to render it readily identifiable
with the subject matter of this Agreement. If so delivered by hand or given
by facsimile, telex or cable such notice or communication shall be deemed received
on the date of dispatch and if so sent by post (or, if sent to an address outside
of British Virgin Islands, so sent by first class air-mail) shall be deemed received
2 business days after the date of dispatch.

 

To the
Assignee:

VERDE RESOURCES,
INC.

Unit 1503,
15/F., The Phoenix, 21-25 Luard Road, Wanchai, Hong Kong

Fax:           852-2152
0612

Email:         mdwu@fcihk.com

 

To the
Assignor:

FEDERAL MINING
RESOURCES LIMITED

Suite 4703,
Central Plaza, 18 Harbour Road, Wanchai, Hong Kong

Fax:           852-2827
7733

Email:         alai@yclhk.com

 

To the Subsidiary:

GOLD BILLION
GLOBAL LIMITED

Unit 1503,
15/F., The Phoenix, 21-25 Luard Road, Wanchai, Hong Kong

Fax:           852-2152
0612

Email:         mdwu@fcihk.com

 

9      
COST AND
EXPENSES

Each party
shall bear its legal and professional fees, costs and expenses incurred in
the negotiations, preparation and execution of this Agreement.

 

10   
GOVERNING
LAW

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

 

 

                                                                         

 

 

IN WITNESSS whereof the parties hereto have executed this Agreement the day and year first above written.

 

 

The Common Seal of                                             )

VERDE RESOURCES, INC.                              )

was affixed in the presence of                              )

Director of the Company:                                      )

 

 

 

/s/ Ming Ding Wu

_____________________

Ming Ding Wu                                                        )

 

 

The Common Seal of                                            )

FEDERAL MINING RESOURCES LIMITED  )

was affixed in the presence of                             )

Director of the Company:                                     )

 

 

 

/s/ Andy Kui Shing Lai

_____________________

Andy Kui Shing Lai                                               )

 

 

The Common Seal of                                            )

GOLD BILLION GLOBAL LIMITED                 )

was affixed in the presence of                             )

Director of the Company:                                     )

 

 

 

/s/ Ming Ding Wu

_____________________

Ming Ding Wu                                                       )ex10-2.htm - Generated by SEC Publisher for SEC Filing

 

Management Agreement

 

Party A:    Federal Mining Resources Limited (“Party A”)

 

Party B:    Gold Billion Global Limited (“Party B”)

 

Article One: General Principles

 

Section 1.1         To adapt to the changing commercial markets, Party A entrusts the management rights of Champmark Sdn Bhd (“Champmark”), a privately limited liability company incorporated in Malaysia, to Party B. Party A and Party B enter into this agreement in goodwill in accordance to the Laws of British Virgin Islands.

 

Section 1.2         Party A owns 85% equity interest in Champmark.  Champmark is the Mining Contractor of the Mining Lease for Site IV-1 at the Merapoh Gold Mine under the Contract for Work with MMC Corporation Berhad, the Permit Holder of the Mining Lease.

 

Article Two: Term

 

Section 2.1  Term. The term of this agreement shall commence on the date of execution of this agreement and shall remain in force and effect until both Parties consider that the achievement of the objective of this agreement is no longer possible or not to a satisfactory degree, the Parties may decide at any moment to terminate the agreement on a date mutually agreed upon. 

 

Article Three: Rights & Obligations

 

Section 3.1  Rights & Obligations of Party A

 

(1)              Party A retains the control over the ownership, the mortgage rights, and the disposition of the assets of Champmark. When Party A exercises the rights over the assets of Champmark, such action shall not affect Party B’s ability to maintain normal management and operation of Champmark’s mining operation at Site IV-1 of the Merapoh Gold Mine and should undertake to advise Party B in writing at the earliest possible time.

 

(2)              Party A shall provide to Party B the location for the management and operation of Site IV-1 of the Merapoh Gold Mine in Pahang, Malaysia.

  

Party A acknowledges that its reasonable good faith cooperation is critical to the ability of Party B to perform its duties hereunder successfully and efficiently. Accordingly, Party A agrees to cooperate fully with Party B in facilitating Party B to formulate goals and objectives which are deemed to be in Champmark’s best interest.

 

 

 

- 1 -

 

 

Section 3.2        Rights & Obligations of Party B

 

(1)                           Party B shall resume the management and administrative rights over the day-to-day business affairs of Champmark and the mining operation at Site IV-1 of the Merapoh Gold Mine. Party B shall be responsible for setting the operational objectives and management operating system for Champmark in accordance to the laws, decree and pertinent rules and regulations and the terms and conditions of this agreement.

 

(2)                           Party B shall hold the final right for the appointment of members to the Board of Directors and the management team of Champmark.

 

(3)                           Party B shall become the principal of Champmark and hold the right to authorize Champmark to act for and on behalf of Party B, and to impose non-compete restriction on Champmark.

 

(4)                           Party B shall provide financial support to Champmark that include the obligation to bear losses incurred by Champmark under normal operation circumstances. Party B shall also provide funding for further investment in Champmark and be entitled to the option of purchasing an equity interest in Champmark.

 

(5)                           Party B shall be entitled to the sharing of profit and the right to impose no dividend policy,

 

(6)                           Party B is responsible for preparing the management operations plan, the plan for use of funds, and final financial report.

 

(7)                           Party B shall resume the responsibility for management of the personnel, supplies and equipments of Champmark. Party B could recruit, hire, train, promote, assign, set compensation level, and discharge all operation and service personnel.

 

Article Four: Party B Management Executives

 

Section 4.1  Accountability. Party B shall apply the management accountability concept to Champmark. Each level of the management and each department shall be responsible for their performance and be accountable for their actions, with the management appointed by Party B being accountable for the performance of Champmark. The responsibilities of the management include:

 

(1)   based on Champmark’s actual situation and management requirements, develop the strategic plan for the setup and personnel modification to support Champmark’s growth; 

 

 

- 2 -

 

 

 

(2)   develop the operation plan and budget for the fiscal year and responsible for the day-to-day operations and management controls;

 

(3)   solve problem areas as identified by Party A, recognize needed improvements, take corresponding corrective action and determine the strategic plan required;

 

(4)   responsible for the day-to-day operation of Champmark, represent Champmark in all general business transaction and is authorized to negotiate and enter into agreements on behalf of Champmark.

 

In order to fulfill the above responsibilities, the management shall assert command over the business affairs and operations of Champmark. The various department heads shall perform their responsibilities according to the corporate strategy as set out by Party B.  

 

Article 6: Liabilities for Breach of Contract

 

Section 6.1  Party A’s Liabilities. If Party A fails to comply with the terms and conditions as set out in this agreement, causing Party B unable to meet the management objectives, Party B has the right to request Party A to resolve the problem within a certain timeframe. If Party A is unable to resolve the situation, Party B has the right to terminate this agreement. Party A shall compensate Party B for all related financial loss and damages.  

 

Section 6.2  Party B’s Liabilities. If Party B fails to comply with the terms and conditions as set out in this agreement and unable to deliver the management objectives, Party A has the right to request Party B to resolve the problem within a certain timeframe. If Party B is unable to resolve the situation, Party A has the right to terminate this agreement. Party B shall compensate Party A for all related financial loss and damages.  

 

Article 7: Miscellaneous

 

Section 7.1  Completion. Party A shall complete all procedures required to transfer the management operations rights of Champmark and the Site IV-1 of Merapoh Gold Mine to Party B within 30 days of execution of this agreement.

 

Section 7.2 Complementation Agreements. The parties can execute supplementary terms to this agreement in writing as complementation agreement, which is executed by the parties hereto.

 

Section 7.3  Copies. There are two copies of this agreement, each party has one copy and each copy is a legally binding document. 

 

 

 

 

- 3 -

 

 

Section 7.4  Force Majeure. During the term of this agreement, if some unforeseen event beyond the control of the parties that prevents any of the parties from performing its obligations under the agreement, both parties shall promptly handle the situation in accordance to the laws.

 

Section 7.5  Termination. In case of disputes during the term of this agreement, the parties shall try to resolve the dispute amiably. In the event if the issues cannot be resolved, the parties shall request to the other party in writing 30 days prior to the termination of this agreement. 

 

Section 7.6 This agreement shall become a legally binding document when the parties have caused this agreement to be executed on the date sign and sealed by their duly authorized representatives.

 

 

 

 

 

Party A                                                                      Party B

Federal Mining Resources Limited                         Gold Billion Global Limited               

 

 

 

 

/s/ Lai Kui Shing Andy                                            /s/ Mind Ding Wu

                                                                                                                                                

Representative: Lai Kui Shing Andy                          Representative: Ming Ding Wu

 

Date:     1/7/2013                                                     Date:     1/7/2013

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