Document:

Unassociated Document

    EXHIBIT
      10.2

    

    Option
      Agreement

    (English
      Translation)

    

    Junsheng
      Wang,
      a
      citizen of the People’s Republic of China (“PRC”), Identification Card No.:
142226600516171(hereinafter
      “Party A” or “Shareholder”).

    

    Shanxi
      Bestlink Management Consulting Co., Ltd.,
      a legal
      person under the laws of the PRC, with its legal address 8/F, Beicang Building,
      Jianshe North Road No76, Taiyuan, Shanxi Province, PRC, its facsimile number
      as
      0351-4656787, and its legal representative as Beicang Hou (hereinafter “Party B”
or “Option Holder”).

    

    Shanxi
      Changchi Enterprise Co., Ltd.,
      a legal
      person under the laws of the PRC, with its legal address Liuxiang South Road
      No48,Taiyuan City, Shanxi Province, PRC, its facsimile number as 0351-4656981,
      and its legal representative as Beicang Hou (hereinafter “Party
      C”).

    

    Fanshi
      County Xinyu Iron Resource Co., Ltd.,
      a legal
      person under the law of the PRC, with its legal address in the Village of
      Daying, Shanxi Province, PRC, its facsimile number as 0350-5527852, and its
      legal representative as Junsheng Wang (hereinafter “Party D” or
“Company”).

    

    Party
      A
      is the legal holder and beneficiary of the shares (the “Shares”) to be optioned
      hereunder. 

    

    The
      parties hereto have agreed to enter into certain agreements for loan, operation
      and services, and will execute those agreements concurrently with this option
      agreement (the “Agreement”). 

    

    As
      guarantee
      of Party
      B’s
      rights in the above-described agreements, Party A hereby grants Party B an
      option, and the parties agree as follows as of January 5, 2006: 

     

    Article
      1 Definition

    

    Unless
      otherwise
      provided, the following terms shall be defined as follows in this Agreement:
      

    

    “Option”:
      shall
      refer to the option set forth in Section 2.1 of this Option
      Agreement;

     

    “Encumbrances”:
      shall
      refer to all encumbrances,
      including lien, mortgage,
      and pledge,
      attached
      to the option;

    

    “Exercise
      Period”:
      shall
      be from the effective date of this Option Agreement to the earlier of (a)
      December 31, 2025; (b) the establishment of a liquidation committee by the
      Company.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Optioned
      Shares”:
      shall
      refer to all or any of the Shares that Party A owns in the Company.

    

    “Method
      of Option Exercise”:
      shall
      be determined by the documents signed jointly by Party A and Party B from the
      effective date of this Option Agreement through the Exercise Period.

    

    “Parties”:
      shall
      refer collectively to Party A, Party B, Party C, and Party D.

     

    Article
      2 Application
      and Exercise
      of Option Rights

    

    2.1
       In
      consideration of the financial support and management services to be provided
      by
      Party B, Party A hereby grants Party B or its designee the Option to acquire
      all
      or any of the Shares of Party A during the Exercise Period in accordance with
      this Agreement. 

    

    2.2
       At
      any
      time during the Exercise Period, Party B may notify Party A in writing (the
      “Initial Notice”) of its intention to exercise the Option. Within
      5
      working days of the Initial Notice,
      Party
      A
      shall communicate to Party B in writing as to Party B’s shortcomings as to the
      disclosures and promises that it made (“Disclosure
      Letter”).
      Party
      B
      may exercise the Option within 5 working days of its receipt of the Letter
      or
      within 15 working days after the Initial Notice, and shall issue a notice to
      Party A regarding the exercise of option (“Option Exercise Notice”). The
      transfer of the Optioned Shares shall become effective 3 days from the date
      of
      the Option Exercise Notice (“Exercise Date”), and
      the
      Disclosure Letter
      shall be
      Party A’s disclosures and promises. The
      Disclosure Letter
      may be
      revised upon mutual consent of Party A and Party B.

     

    2.3
       Within
      two days of the Exercise Date (in accordance with Beijing Time), Party A and
      Party B shall execute the agreement to transfer the Optioned Shares (“Share
      Transfer Agreement”). The exercise price shall be Party A’s original paid-in
      price of the Optioned Shares, or a different price agreed to by the parties,
      provided that any such price cannot exceed the appraisal price of a PRC register
      capital appraiser. On the Exercise Date, Party A shall transfer to Party B
      the
      Optioned Shares, and Party B shall have no obligation to pay until the transfer
      of the Optioned Shares is effective.

    

    2.4
       Party
      C
      and Party D hereby consent to this Agreement, and hereby forfeit any
      rights, including preferential rights, that they may have contractually or
      be
      legally entitled to with respect to the Option, and shall cooperate as necessary
      to facilitate in the transactions contemplated herein, including the execution
      of all documents to evidence their consent hereto. Party D hereby consent to
      this Agreement and shall cooperate with the other parties as necessary.

    

    2.5 If
      Party
      A attempts to transfer the Shares, Party B shall have the right of first refusal
      with respect to these shares, upon the same terms and conditions of the
      attempted transfer.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Article
      3 Representations
      and Warranties

     

    3.1
       Party
      A
      hereby represents and warrants to Party B as follows:

    

    3.1.1
       Party
      A
      is the legal holder and beneficiary of the Optioned Shares;

    

    3.1.2
       Except
      for this Agreement, the Optioned Shares have no Liabilities and are not subject
      to any other option and/or similar arrangements. 

    

    3.1.3
       Party
      A
      has the authority to enter into this Agreement, including all necessary
      authorization and approval of third parties, if any. In entering into this
      Agreement, Party A will not be in breach of the Company’s bylaws or any
      applicable laws, regulations, orders or agreements. 

    

    3.1.4
       During
      the Exercise Period, Party A may not, without Party B’s express written consent,
      encumber or cause to be encumbered the Optioned Shares in any way.

    

    3.1.5
       Party
      A
      agrees and acknowledges that Disclosure
      Letter
      will be
      its disclosures and promises under the Share Transfer Agreement. Accordingly,
      from the execution of this Agreement until the execution of the Share Transfer
      Agreement, Party A shall not take any action that may render the disclosures
      and
      promises of the Disclosure
      Letter
      untrue
      or inaccurate, and in the event that any such action is taken, shall notify
      Party B in writing within 2 days of taking the action. 

    

    3.1.6
       Party
      A
      shall maintain the existence and normal operations of the Company, and shall
      not
      amend the Company bylaws or other documents.

    

    3.1.7
       Party
      A
      will borne all expenses incurred in connection with the transactions
      contemplated herein.

    

    3.1.8
       Party
      A
      hereby acknowledges the efforts and expenses incurred by Party B in connection
      with this Agreement, and agrees that in the event of breach by Party A,
      liquidated damages in the sum of RMB 8 million represents a fair and equitable
      sum for Party B’s damages. Party A further acknowledges that in addition to the
      liquidated damages, Party B may elect to continue this Agreement.

    

    3.2
       Party
      B
      hereby represents and warrants that it is authorized to enter into this
      Agreement. 

     

    Article
      4 Validity
      of Agreement

    

    This
      Agreement is effective upon the parties’ execution and seal. If no Option
      Exercise Notice is issued on or before the last day of the Exercise Period,
      this
      Agreement shall automatically terminate on the last day of the Exercise
      Period.

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

    Article
      5 Authorization

     

    5.1
       To
      carry
      out the terms of this Agreement, Party A hereby irrevocably grants Party
      B
      the authority to sign on its behalf any and all necessary documents and to
      comply with any and all other formalities, and Party A may provide Party B
      with
      the necessary proxy to effectuate this herein provision, which proxy shall
      exclude all matters beyond the scope of this Agreement. Said proxy shall
      automatically terminate 90 days from the termination date of this Agreement.
      

    

    5.2
       From
      the
      effective date of this Agreement until December 31, 2025, Party A hereby
      irrevocably and without condition entrust Party B or its designee with all
      of
      Party A’s voting rights as a shareholder of the Company. Party B shall have
      complete autonomy to exercise such rights, including the election of Company
      management and all other matters. 

     

    Article
      6 Confidentiality

    

    6.1
       The
      parties shall maintain in confidence all matters relating to a transfer of
      the
      Optioned Shares. 

    

    6.2
       If
      any
      party breaches the confidentiality obligation, said party shall be liable for
      all resulting damages to the other parties and to the Company. 

     

    Article
      7 Breach

     

    7.1
       A
      breaching party shall pay the non-breaching party the sum of RMB 1 million
      as
      penalty for breach of the confidentiality provision or any of the party’s
      representations and warranties. 

    

    7.2
       Party
      A
      hereby
      agrees and acknowledges that the terms of this Agreement, including Article
      5
      above, are crucial to Party B and its business objectives, and Party A hereby
      agrees that in the event of its breach of this Agreement, Party B may elect
      to
      have Party A specifically perform its obligations thereto. 

    

    7.3 If
      the
      terms of this Agreement cannot ultimately be performed, the breaching party
      shall be liable for all the direct economic damages of the non-breaching party.
      If the damages cannot be determined, then the breaching party shall pay as
      penalty to the non-breaching party a sum equal to twenty percent of the price
      of
      the Optioned Shares.

     

    Article
      8 Resolutions
      Applicable to Law and Disputes

    

    8.1
       This
      Agreement shall be governed by the laws of the PRC.

    

    8.2
       The
      parties shall strive to settle any dispute arising from this Agreement through
      friendly consultation. In case no settlement can be reached through
      consultation, either party

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    may
      submit the dispute to China International Economic and Trade Arbitration
      Commission (“CIETAC”) for arbitration in accordance with the rules of CIETAC.
      The arbitration proceedings shall take place in Beijing and shall be conducted
      in Chinese. The losing side shall bear all arbitration-related fees.

     

    Article
      9 Other
      conditions

    

    9.1
       If
      any
      clause of this Agreement is determined to be invalid or non-enforceable, such
      clause shall be deemed invalid only with respect to the affected clauses, and
      without affecting other clauses of the Agreement in any way.

    

    9.2 Notices
      pursuant to this Agreement shall be written in Chinese and shall be delivered
      or
      sent by mail, telegram or facsimile transmission to the address of the relevant
      party set forth below. A party shall provide written notice of any change in
      address or facsimile number within 10 days prior to the change. 

    

    Party
      A:
      Junsheng Wang

    Address:
      Daying Town South, Fanshi County, Shanxi Province, PRC

    Facsimile:
      0350-5582700

    Attention: Junsheng
      Wang

    

    Party
      B:
      Shanxi Bestlink Management Consulting Co., Ltd.

    Address:
      8/F, Beicang Building, Jianshe North Road No76, Taiyuan, Shanxi Province,
      PRC

    Facsimile:
      0351-4656787

    Attention:
      Beicang Hou

    

    Party
      C:
      Shanxi Changchi Enterprise Co., Ltd.

    Address:
      Liuxiang South Road No48,Taiyuan City, Shanxi Province, PRC

    Facsimile:
      0351-4656981

    Attention:
      Beicang
      Hou

    

    Party
      D:
      Fanshi County Xinyu Iron Resource Co., Ltd.

    Address:
      Daying Town South, Fanshi County, Shanxi Province, PRC

    Facsimile:
      0350-5582700

    Attention:
      Junsheng Wang

    

    The
      date
      when the notice is deemed duly served shall be determined as follows: (a) a
      notice delivered personally or
      mailed
      is deemed duly served upon the delivery, (b) a notice sent by facsimile
      transmission is deemed duly served upon the completion of the transmission,
      except that if the notice is transmitted on a non-work day, the notice is deemed
      duly served upon the first work-day thereafter. 

    

    9.3
       This
      Agreement and any attachment thereto constitute the entire agreement of
      the

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    parties
      relating to the subject matter of this Agreement and supersedes all previous
      agreements or understanding. No amendment of this Agreement shall be valid
      unless it is in writing and signed by the Parties. 

    

    9.4
       This
      Agreement shall be in Chinese, with 6 copies, two each to Party A and Party
      B,
      and one each to Party C and Party D.

    

    Party
      A:

     

    /s/
      Junsheng Wang 
      
        

      

    

    Junsheng
      Wang

    Date:
      January 5, 2006 

    

    Party
      B:

    Shanxi
      Bestlink Management Consulting Co., Ltd.

    

    /s/
      Beicang Hou 
      
        

      

    

    Legal
      Representative 

    Date:
      January 5, 2006

    

    Party
      C:

    Shanxi
      Changchi Enterprise Co., Ltd.

    

    /s/
      Beicang Hou 
      
        

      

    

    Legal
      Representative

    Date:
      January 5, 2006

    

    Party
      D:

    Fanshi
      County Xinyu Iron Resource Co., Ltd.

    

    /s/
      Junsheng Wang 
      
        

      

    

    Legal
      Representative

    Date:
      January 5, 2006EX 10.3

    EXHIBIT
      10.3

    

    Loan
      Agreement

    (English
      Translation)

    

    
      	
              Borrower:

            	
              Fanshi
                County Xinyu Iron Resource Co., Ltd.

            
	
              Legal
                Representative:

            	
              Junsheng
                Wang

            
	
              Address:

            	
              Daying
                town, Fanshi County, Shanxi Province, PRC

            
	 	 
	
              Lender
                (Pledgee):

            	
              Shanxi
                Bestlink Management Consulting Co., Ltd.

            
	
              Legal
                Representative:

            	
              Beicang
                Hou

            
	
              Address:

            	
              8/F,
                Beicang Building, Jianshe North Road No76, Taiyuan, Shanxi Province,
                PRC

            
	 	 
	
              Guarantor
                (Pledgor):

            	
              All
                of the shareholders of the Borrower, being Shanxi Changchi Enterprise
                Co.,
                Ltd. and Junsheng Wang

            
	
              Address:

            	
              12/F,
                Beicang Building, Jianshe North Road No76, Taiyuan, Shanxi Province;
                PRC
                Liuxiang South Road No48,Taiyuan City, Shanxi Province,
                PRC

            

    

    

    This
      agreement (“Agreement”) is entered into in Taiyuan on January 5, 2006 by the
      above parties (“Parties”) pursuant to all applicable laws and regulations and
      upon the mutual consent of the  Parties
      to adhere to the herein terms. 

     

    Terms
      of the Loan

    

    Article
      1 Use
      of
      Proceeds 

    

    Borrower
      shall use the proceeds of the loan in connection with the cash flow necessary
      for Borrower’s operations.

    

    Article
      2 Loan
      Amount

    

    The
      amount of the loan is Renminbi Five Hundred Thousand (RMB 500,000) (“Loan”).
      Based on Borrower’s operations, Lender and Borrower may agree at any time to
      increase the amount of the Loan. Borrower hereby warrants that, without Lender’s
      written consent, Borrower may not borrow money or request loan guaranty from
      third parties, and may not incur additional debts. 

    

    Article
      3 Term

    

    The
      term
      of the Loan is from January 5, 2006 until December 31, 2025. 

    

    Article
      4 Interest
      Rate; Late Payment Penalty

    

    4.1 Interest
      Rate

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    The
      Loan
      shall be interest-free.

    

    4.2 Late
      Payment Penalty

    

    A
      daily
      late payment penalty shall be imposed on any amount of the Loan not repaid
      at
      the end of the Term, at the rate of 0.5% of the unpaid balance per day.

    

    If
      Borrower fails to repay the entire Loan at the end of the Term, Lender may
      exercise its rights as Pledgee. 

    

    Article
      5 Payment
      of Loan

    

    Lender
      shall pay the proceeds of the Loan in installments, in the total sum of RMB
      500,000 on or before the end of 2006.

    

    Article
      6 Repayment
      of Loan

    

    Borrower
      shall repay the Loan in yearly installment payments. 

    

    Article
      7 Early
      Repayments

    

    Borrower
      may not make early repayments of the Loan without Lender’s written consent. In
      the event that Borrower is experiencing financial difficulties, Lender may
      demand for the immediate repayment of the Loan or, in the alternative, exercise
      its rights as Pledgee to recover the Loan amount.

    

    Article
      8 Borrower’s
      Rights and Obligations

    

    8.1 Borrower
      shall complete all procedures to effectuate the pledge within 30
      days.

    

    8.2 At
      Lender’s request, Borrower shall provide Lender or its designee with all
      financial, operational and management information, which information Borrower
      warrants to be complete, current and accurate.

    

    8.3 Borrower
      warrants to timely repay the Loan and interests, if any.

    

    8.4 Lender
      or
      its designee may examine Borrower’s financial records.

    

    8.5 Borrower
      shall notify Lender in writing within 7 days of the occurrence or likely
      occurrence of the following:

    

    8.5.1 Any
      dispute between Pledgor and a third party

    

    8.5.2 Any
      lawsuit, arbitration or administrative actions that affect or may affect
      Borrower’s ability to repay the Loan

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	 	
              8.5.3

            	
              Any
                other event that affect or may affect Borrower’s ability to repay the
                Loan

            

    

    

    Article
      9 Lender’s
      Rights and Obligations

    

    9.1 Lender
      has the right to timely receive repayment of the Loan in full.

    

    9.2 Lender
      has the right to examine and verify the legality of all documents and records
      provided by Borrower, including the use of the Loan proceeds.

    

    9.3 Lender
      shall maintain the pledge certificate and all related documents.

     

    Guaranty

    

    Article
      10. This
      Agreement is guaranteed by a pledge and a guaranty.

    

    Article
      11. Terms
      of
      the Pledge.

    

    11.1 Pledgor
      hereby acknowledges that this Agreement is crucial to Lender’s allocation of its
      capital, and agrees that the Pledge be effectuated pursuant to Attachment
      1,
      and
      further guarantees Borrower’s performance of the terms and conditions of this
      Agreement.

    

    In
      the
      event of Borrower’s breach, and in addition to any other rights of Lender,
      Lender may enforce this Agreement against Pledgor to the extent of Pledgor’s
      guaranty, including the right to demand Pledgor to transfer all pledged shares
      to Lender or its designee based on the initial paid-in price of the register
      capital. 

    

    11.3 Pledgor
      shall provide Lender with all legally required documents effectuating the Pledge
      within 10 working days from the effective date of this Agreement. 

    

    11.4 The
      Pledge is separate and independent from all other terms of this Agreement.
      

    If
      any
      clause of this Agreement is determined to be invalid or non-enforceable, Pledgor
      shall assume all liabilities to the extent of Pledgor’s guaranty. In the event
      that the Agreement between Lender and Borrower is deemed invalid, Pledgor shall
      assume all resulting liabilities of Lender.

    

    11.5 At
      its
      own expense, Pledgor shall use its best effort and take all actions necessary
      to
      effectuate the Pledge and secure the rights of Lender as Pledgee.

    

    Article
      12 Guaranty
      of Guarantor

    

    12.1 Extent
      of
      Guaranty and Guaranty Amount

    

    Guarantor
      hereby guarantees all of the obligations of Borrower and/or Pledgor under this
      Agreement, including actual damages resulting from breach of said obligations,
      as well as all expenses incurred by Lender to enforce its rights (including
      without limitations fees legal, arbitration, travel, administrative, appraisal
      and auction fees and expenses).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    12.2 Form
      of
      Guaranty

    

    The
      Guranty is jointly made, and shall be in effect from the effective date of
      this
      Agreement until Borrower and/or Pledgor has satisfied all obligations under
      the
      Agreement, but in no event earlier than December 31, 2025.

    

    12.3 Effectuating
      the Guaranty

    

    Pursuant
      to the request of Lender and/or Pledgee, Guarantor shall assist Borrower and/or
      Pledgor to satisfy their obligations under the Agreement, and Guarantor shall
      waive its right of protest.

    

    12.4 Exemption

    

    Guarantor
      shall further guarantee such other changes to the Agreement agreed to between
      Lender and/or Pledgee on the one hand and Borrower and/or Pledgor on the other,
      to the extent that such changes may increase the obligations of Borrower and/or
      Pledgor.

    

    12.5 Effectiveness
      of the Guaranty

    

    This
      Guaranty is effective from the signing of or affixing seal to this Agreement
      by
      Guarantor’s representative and delivering same to Lender and/or
      Pledgee.

     

    Breach

    

    Article
      13 Event
      of
      Breach

    

    13.1 If
      Borrower obtains the Loan through false data or documentation

    

    13.2 If
      Borrower fails to timely repay the Loan, interest or related fees

    

    13.3 If
      Borrower uses the Loan proceeds for purposes other than as described in Article
      1

    

    13.4 If
      Borrower refuses or otherwise prevent Lender (including its authorized
      representative) from supervising and inspecting the Borrower’s use of the Loan
      proceeds

    

    13.5 If
      other
      debts or liabilities of Borrower affect or may affect its ability to satisfy
      its
      obligations to Lender

    

    13.6 If
      Borrower is in financial difficulties or is involved in litigation, arbitration
      or other legal proceedings, the occurrence of any one of which in Lender’s
      opinion affect or may affect Lender’s rights under the Agreement

    

    13.7 If
      any
      part or all of the Guaranty is ineffective or terminated or is not effectuated,
      and Borrower fails to secure new guaranty at the request of
      Lender

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    13.8 If
      Borrower disposes its assets or contractual rights without Lender’s
      authorization, or if any other event occurs that affect Borrower’s ability to
      repay the Loan

    

    Article
      14 Remedies

    On
      the
      occurrence of any Event of Breach, Lender shall be entitled to do any one of
      the
      following or combination thereof:

    

    14.1 Declare
      the Loan due immediately and demand repayment of the Loan and all outstanding
      interests and related fees;

    

    14.2 Exercise
      its rights under the Guaranty; and/or 

    

    14.3 Terminate
      its relationship with Borrower

     

    General
      Provisions

    

    Article
      15 During
      the Term, Borrower’s obligation to make annual repayments of the Loan is
      irrespective of Borrower’s ability to complete its plans

    

    Article
      16 Dispute
      Resolution

    

    The
      parties shall strive to settle any dispute arising from this Agreement through
      friendly consultation. In case no settlement can be reached through
      consultation, either party may submit the dispute to China International
      Economic and Trade Arbitration Commission (“CIETAC”) for arbitration in Beijing
      in accordance with the rules of CIETAC. The decision of the CIETAC shall be
      final and binding upon all parties. During the period when a dispute is being
      resolved, the parties shall in all other respects continue their implementation
      of this Agreement.

     

    Article
      17 Effective
      Date of this Agreement

    

    This
      Agreement shall become effective on the date the representatives of all parties
      sign the Agreement.

    

    Article
      18 Notice

    

    Notices
      pursuant to this Agreement shall be written in Chinese and shall be delivered
      or
      sent by mail, telegram or facsimile transmission to the address of the relevant
      party set forth below. A party shall provide written notice of any change in
      address or facsimile number within 10 days prior to the change.

    

    Article
      19 Four
      copies of this Agreement shall be made, one copy to each party, and each copy
      having the same force and effect. 

    

    [Remainder
      of Page Intentionally Blank]

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    [Signature
      Page]

     

    

    Borrower:  

    Fanshi
      County Xinyu Iron Resource Co., Ltd.

    

    /s/
      Junsheng Wang

      
        

      

    

    Junsheng
      Wang

    Legal
      Representative

    January
      5, 2006

    

    

    Lender
      (Pledgee): 

    Shanxi
      Bestlink Management Consulting Co., Ltd. 

    

    /s/
      Beicang Hou

    
      
Beicang
      Hou

    Legal
      Representative

    January
      5, 2006

     

    

    Guarantor: 

    Shanxi
      Changchi Enterprise Co., Ltd.

    

    /s/
      Beicang Hou

      

    

    Beicang
      Hou

    Legal
      Representative

    January
      5, 2006

    

    

    Guarantor: 

    

    /s/
      Junsheng Wang

      
Junsheng
      Wang 

    January
      5, 2006

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