Document:

Unassociated Document

General Agent Contract for Drugs Sales

Party A: Hainan Lingkang Pharmaceutical Co., Ltd.

Party B: Shandong Yaoyuan Pharmaceutical Co., Ltd.

 

In order to better exploit the market, through full negotiation, Party A and Party B have entered the Contract according to the regulation in the Contract Law of the People's Republic of China and based on the principle of equality and mutual benefit, which shall be observed by both parties.

	
I.

	
Party A authorizes Party B as the exclusive sales agent of drugs in Shandong region. The valid period of agent is from Jan.1, 2011 to Dec.31, 2011. The content of agent drugs sees in attachment.

	
II.

	
The agent category provided by Party A to Party B shall be performed according to the following terms:

	
III.

	
Goods payment settlement

Settlement method: Monthly settlement (the specific amount shall be confirmed by both parties additionally)

	
IV.

	
Goods delivery

	
  

	
1.

	
The goods delivery place shall be designated by Party B. Party A delivers goods by motor transport and the long-distance freight charges shall be assumed by Party A. The short-distance goods picking fee shall be assumed by Party B. If Party B requires speeding up the transportation, the balance fee shall be assumed by Party B.

	
  

	
2.

	
Term of goods picking: Party B shall pick up goods from the delivery place within three days after receiving the bill of lading. If the drugs shortage and damage are found when picking up goods, Party B shall put forward within three days depending on the valid document of the freight department. It will be deeded that the drugs quantity is qualified if Party B fails to put forward.

	
V.

	
Rights and obligations of both parties

	
1.

	
Party A:

	
  

	
(1)

	
Party A shall provide documents and materials related to product sales and tendering.

	
  

	
(2)

	
Party A shall guarantee the sufficient goods supply and product quality.

	
  

	
(3)

	
Party A shall coordinate the market and ensure that no products in other regions sneak into Party B’s region.

	
  

	
(4)

	
Party A has the right to adjust or cancel the exclusive sales agent of Party B at the above agent region if one of the following situations occurs:

	
  

	
a.

	
Party B has the behavior violating laws and regulations during the operation.

	
  

	
b.

	
Party B sells products beyond the agent region without permission of Party A, or maliciously invades products into other regions to disrupt the market.

	
  

	
c.

	
Party B has other behaviors seriously violating the Contract.

	
2.

	
Party B:

	
  

	
(1)

	
Party B has the exclusive sales agent right of the product in the Contract within the scope authorized.

	
  

	
(2)

	
The liability caused by product quality shall be assumed by Party A, and the transportation damage and package pollution shall be solved by both parties through negotiation.

 

  

  

  

 

	
  

	
(3)

	
Party B shall provide logistics situation to Party A monthly and accept the service and supervision of Party A.

	
  

	
(4)

	
Party B ensures not invade product to other regions and not enter a bid and sell in other regions.

	
  

	
(5)

	
Party B has the priority right to renew the contract after the expiration of the Contract. If Party A’s new products go into the market, Party B has the priority right to distribute.

	
VI.

	
Handling of goods invasion

	
1.

	
Definition of goods invasion: If the authorized person invades products into other regions unauthorized and sells beyond the authorized region (directly sales or repeatedly turnover), it is deemed as the goods invasion.

	
2.

	
Handling of goods invasion:

	
  

	
(1)

	
If the goods invasion occurs, Party B shall immediately notify the manager of Party A or the headquarters of Party A, and Party A can authorize Party B to handle the goods invasion. If necessary, Party A can appoint person to confirm in the market.

	
  

	
(2)

	
The false goods invasion behavior shall be handled according to the goods invasion. If someone claims to be invaded but cannot provide the corresponding evidence, Party A will not handle it.

	
  

	
(3)

	
The party implementing goods invasion shall assume the fee of the above market goods receiving person and the fee of receiving products.

	
VII.

	
Others

	
1.

	
The objection shall be solved by both parties through friendly negotiation; if the negotiation fails, it shall be submitted to the local People’s Court of Party A for litigation.

	
2.

	
If the irresistible factors occur, it shall notify to the other party timely. The Contract shall be terminated after both parties solving the relevant matters through negotiation. At the date of termination, all legal documents and agreements provided by Party A to Party B shall be terminated at the same time.

	
3.

	
This Contact is in duplicate, and it will take effect after signing and sealing of the two parties.

	
4.

	
Matters unmentioned here shall be negotiated by both parties additionally and the supplement terms have the equal legal force.

 

 

	
Party A: Hainan Lingkang Pharmaceutical Co., Ltd. (Seal)

	 	
Party B: Shandong Yaoyuan Pharmaceutical Co., Ltd. (Seal)

	
Representative of Party A: Chen Linquan

	 	
Representative of Party B: Zhao Guojun

	
Address: Jinan of Shandong

	 	
Address: No.80 of Jiangjun Road

	
Fax:

	 	
Fax:

	
Tel:

	 	
Tel:

	
Date of signing: Jan. 1, 2011

	 	
Date of signing: Jan. 1, 2011Unassociated Document

EARN-IN AGREEMENT

This EARN-IN AGREEMENT (the “Agreement”) is made as of  June 29, 2010 (the “Effective Date ”), between and among (i) Meili Tsai, a Hong Kong individual (the “ Seller ”); and (ii) the signatories to this Agreement indicated as “Buyers,”[Yunlu Yin, Zhihao Pan, Zhengang Chi, Yiting Zhang, Yanmin Song, Zhencheng Huang, Yanming Lv, Yanliang Song, Yan Zhang, Xueye Jing, Xianming Zeng, Shunli Wang, Shulan Li, Shouqiang Han, Renyuan Su, Qingwei Meng, Qingdong Zeng, Nan li, Naihua Hu, Li Li, Junyan Su, Hong Zhang, Hong Li, Hanjun Liu, Guojun Zhao, Feng Jin, Fangyuan Song, Dandan Wang, Dan Li, Chaobo Song, Boliang Zhu, An Fu] each an individual citizen of the People’s Republic of China (collectively, the “ Buyers ”) (each of the foregoing, a “ Party ” and together, the “ Parties ”). Capitalized terms not otherwise defined have the meanings assigned to them in Appendix A to this Agreement.

RECITALS

	
A.

	
The Seller is the sole shareholder of Global Pharma Enterprise Group Limited, a company organized and existing under the laws of British Virgin Islands (“ Holdco ”). Holdco in turn is the sole equity holder of Bionminal BioPharm Group Limited and Hong Kong Wisdom Fortune Medicine Holding Group Limited, the companies organized and existing under the laws of Hong Kong. Bionminal BioPharm Group Limited is the sole equity holder of Anhui Xuelingxian Pharmaceutical Co., Ltd., Tonghua Tongdetan Pharmaceutical Medicinal Materials Co.,Ltd., and Hong Kong Wisdom Fortune Medicine Holding Group Limited is the sole equity holder of Shandong Global Pharm Co.,Ltd.,(Formerly Shandong Yaoyuan Pharmaceutical Co.,Ltd), a wholly foreign-owned company existing under the laws of the People’s Republic of China (the “ Operating Company ”). The Buyers are the former equity holders and the management team of the Operating Company.

 

	
B.

	
After the date of this Agreement, the Seller intends to enter into a share exchange agreement  (the “Exchange Agreement ”) with a United States-domiciled public reporting shell company whose securities are quoted on the over-the-counter bulletin board (the “ Shell Company ”).  Upon consummation of the transactions contemplated by the Exchange Agreement (the “ Exchange Transaction ”), the Shell Company will, in exchange for the issuance of shares of the common stock of the Shell Company, acquire 100% of the issued and outstanding capital stock of Holdco, and, indirectly, sole ownership of the Operating Company. The Call Right described in this Agreement will relate to shares of the capital stock of Holdco until such time as those shares are exchanged for shares of the Shell Company, and thereafter  pari passu  to the shares of the Shell Company held by the Seller.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt and sufficient of which is acknowledged by the Parties, the Parties agree as follows:

  

  

  

AGREEMENT

The Parties to this Agreement, intending to be bound thereby, in consideration for the mutual promises and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged by the Parties, agree as follows.

ARTICLE I

CALL RIGHT

 

	 	
1.1

	
Call Right.   The Buyers will have, during the Exercise Period, and according to the following schedule, the right and option to purchase from the Seller, and upon the exercise of such right and option the Seller will have the obligation to sell to the Buyers, a portion of the Seller’s Shares identified in the Call Exercise Notice (the “ Call Right ”).  Any Shares not purchased at a point in the following schedule may be purchased at any later point in the schedule. “ Seller’s Shares ” means those shares of the capital stock of the Holdco or, upon and after the Exchange Transaction, those exchanged shares of the public Shell company held by the Seller totaled at [           ] shares of the public shell company’s issued and outstanding common shares, as the case may be at the time when the Buyer exercises the Call Right.

	
  

	
(a)

	
(i) the occurrence of the date that is six months after the date of this Agreement and (ii) the date upon which the Buyer and Seller have entered into a binding employment agreement for a term of not less than Three years for Yunlu Yin serve as the Director, CEO of the public shell company, An Fu serve as the CFO of the public shell company, Dan Li serve as the Board Secretary of the public shell company, Zhihao Pan, Zhengang Chi, Zhencheng Huang, Yiting Zhang, Yanming Lv, Yanliang Song, Yan Zhang, Xueye Jing, Xianming Zeng, Shunli Wang, Renyuan Su, Qingwei Meng, Nan Li, Naihua Hu, Li Li, Hong Li, Hanjun Liu, Fangyuan Song, Chaobo Song, serve as the management team of the Operating Company, each Buyer may exercise a Call Right to his or her Proportionate Share (as defined below) of 25% of the make-good shares of the Seller’s Shares.

	
  

	
(b)

	
At any time after a date which Holdco and its subsidiaries achieve $3.6M 2010 second quarter after tax net income and a satisfactory review report is issued of the result according to US GAAP for the Second Quarter of 2010 but before the Expiration Date (as defined below), each Buyer may exercise a Call Right to his or her Proportionate Share (as defined below) of 25% of the make-good shares of the Seller’s Shares.

	
  

	
(c)

	
At any time after a date which Holdco and its subsidiaries achieve $3.8M 2010 third quarter after tax net income and a satisfactory review report is issued according to US GAAP for the third quarter 2010 but before the Expiration Date (as defined below), each Buyer may exercise a Call Right to his or her Proportionate Share (as defined below) of 25% of the make-good shares of the Seller’s Shares.

 

  

  

  

	
  

	
(d)

	
At any time after a date which Holdco and its subsidiaries achieve $15.2M 2010 after tax net income and a satisfactory audit report is issued according to US GAAP for 2010 but before the Expiration Date (as defined below), each Buyer may exercise a Call Right to his or her Proportionate Share (as defined below) of 25% of the make-good shares of the Seller’s Shares.

As used in this Agreement, “Proportionate Share” means the percentage set forth next to a Buyer’s name on Exhibit C to this Agreement.

 

	 	
1.2  

	
Call Period.  The Call Right will be exercisable by the Buyer by delivering a Call Exercise Notice at any time during the period (the “ Exercise Period ”) commencing on the earliest date on which a Call Right may be exercised pursuant to Section 1.1 (the “ Initial Call Date ”) and ending at 6:30 p.m. (New York time) on the fifth anniversary of the Initial Call Date (such date or the earlier expiration of the Call Right is referred to herein as the “ Expiration Date ”).

 

	 	
1.3  

	
Exercise Process.   In order to exercise the Call Right during the Exercise Period, the Buyer must deliver to the Seller a written notice of such exercise substantially in the form attached hereto as Exhibit B (a “ Call Exercise Notice ”) to such address or facsimile number set forth therein. The Call Exercise Notice will indicate the number of the Seller’s Shares as to which the Buyer is then exercising its Call Right and the aggregate Call Price. Provided the Call Exercise Notice is delivered in accordance with Section 5.2 to the Seller on or prior to 6:30 p.m. (New York time) on a Business Day, the date of exercise (the “Exercise Date”) of the Call Right will be the date of such delivery of such Call Exercise Notice. In the event the Call Exercise Notice is delivered after 6:30 p.m. (New York time) on any day or on a date which is not a Business Day, the Exercise Date will be deemed to be the first Business Day after the date of such delivery of such Call Exercise Notice. The delivery of a Call Exercise Notice in accordance herewith will constitute a binding obligation (a) on the part of the Buyer to purchase and (b) on the part of the Seller to sell, the Seller’s Shares subject to such Call Exercise Notice in accordance with the terms of this Agreement.

 

	 	
1.4

	
Call Price.

 

	
  

	
(a)

	
With respect to any exercise of the Call Right, the per-share “Call Price” will be equal to Three Hundred Thousand United State Dollars (US$300,000) (the “ Aggregate Call Price ”), divided by [        ]

	
  

	
(b)

	
The Buyers will pre-pay the aggregate Call Price to the Seller, in the amount of Three Hundred Thousand United States Dollars, by wire transfer of immediately available funds or by another method notified in writing by the Seller to the Buyers before such payment is made, concurrently with the investment by the investors in the Equity Financing.

	
  

	
 

	
  

	
(c)

	
Within thirty (30) days after the Expiration Date, or upon written termination and release by any Buyer of any unexercised Call Rights held by such Buyer, Seller will refund to such Buyer the amount of the aggregate Call Price corresponding to the Seller’s Shares as to which there is no longer a Call Right, without interest.

 

  

  

  

	 	
1.5

	
Delivery of the Shares.    Upon the receipt of a Call Exercise Notice and the payment of the Call Price, the Seller will deliver, or take all steps necessary to cause to be delivered, the Seller’s Shares being purchased pursuant to such Call Exercise Notice.

ARTICLE II

ENCUMBRANCES; TRANSFERS, SET-OFF; ESCROW

 

	 	
2.1  

	
Encumbrances.   Upon exercise of the Call Right, the Seller’s Shares being purchased will be sold, transferred and delivered to the Buyer free and clear of any claim, pledge, charge, lien, preemptive rights, restrictions on transfers (except as required by securities laws of the United States), proxies, voting agreements and/or any other Encumbrance.

	
  

	
 

	 	
2.2  

	
Lock-up; Transfers.   Prior to the Expiration Date, the Seller will not transfer to any other Person and will continue to own, free and clear of any Encumbrance, except (a) as may be required by the Exchange Agreement; and/or (b) as may be required in order to give effect to the provisions of Section 2.5, such amount of the Seller’s Shares as may be required from time to time to in order for the Buyer to exercise its Call Right in full.

	
  

	
 

	 	
2.3  

	
Legend.   The Seller will cause a notification to be made in the share register of Holdco, and, upon and after the Exchange Transaction, will cause to be placed on any share certificate representing any of the Seller’s Shares, language in substantially the form as follows:

“THE SHARES REGISTERED IN THE NAME OF [ • ] OR REPRESENTED BY THIS CERTIFICATE, AS THE CASE MAY BE, ARE SUBJECT TO A CALL RIGHT WHICH PROHIBITS THEIR TRANSFER TO ANY PERSON OTHER THAN THE HOLDER OF THAT RIGHT PRIOR TO THE EXERCISE OF THE RIGHT OR ITS EXPIRATION. ANY PERSON ACCEPTING ANY INTEREST IN THE SHARES SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL THE PROVISIONS OF THE EARN-IN AGREEMENT IN WHICH THAT CALL RIGHT IS SET FORTH, AND THE SHARES WILL REMAIN SUBJECT TO THE CALL RIGHT AS PROVIDED THEREIN. A COPY OF THE EARN-IN AGREEMENT WILL BE FURNISHED TO THE RECORD HOLDER OF THIS CERTIFICATE WITHOUT CHARGE UPON WRITTEN REQUEST TO THE COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS.”

 

	 	
2.4

	
Set-off.   The Buyer will be absolutely entitled to receive all the Seller’s Shares subject to the exercise of a Call Right, and for the purposes of this Agreement, the Seller hereby waives, as against the Buyer, all rights of set-off or counterclaim that would or might otherwise be available to the Seller.

  

  

  

	 	
2.5

	
Escrow of the Seller’s Shares

	
  

	
(a)

	
Upon the Exchange Transaction, the Seller will deliver to Guang Dong Guoxin Law Firm, as collateral agent (the “ Collateral Agent ”), certificates representing the Seller’s Shares. The certificates representing the Seller’s Shares (together with duly executed stock powers in blank) will be held by the Collateral Agent.

	
  

	
(b)

	
Upon receipt of a Call Exercise Notice, the Collateral Agent will promptly deliver the Seller’s Shares being purchased pursuant to such Call Exercise Notice in accordance with the instructions set forth therein and in accordance with any other lock-up, make-good or similar agreement in place between the Buyer or the Seller and other third party. In the event that the Collateral Agent receives notice from the Parties that the Conditions have not been met, the Seller’s Shares will be distributed in accordance with their instructions.

	
  

	
(c)

	
After the delivery of the documents mentioned in the above paragraph (a), neither party may wholly or partially terminate the escrow relationship with the Collateral Agent or wholly or partially modify the terms and conditions agreed for the escrow of the Seller’s Shares at any time before the 35th day subsequent to the Expiration Date, except that the Buyers effectively enforced the Call Right.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

	 	
3.1  

	
Representations and Warranties of the Seller.    The Seller represents and warrants to the Buyer, that:

	
  

	
(a)

	
Due Authorization.  The execution and delivery of this Agreement and the consummation of the transactions contemplated hereunder to be carried out by it have been duly authorized by all necessary action on the part of the Seller. This Agreement, and all agreements and documents executed and delivered pursuant to this Agreement, constitute valid and binding obligations of the Seller, enforceable against the Seller in accordance with its terms, subject to applicable Bankruptcy Laws and other laws or equitable principles of general application affecting the rights of creditors generally.

	
  

	
 

	
  

	
(b)

	
No Conflicts.   Neither the execution or delivery of this Agreement by the Seller nor the fulfillment or compliance by the Seller with any of the terms hereof will, with or without the giving of notice and/or the passage of time, (i) conflict with, or result in a breach of the terms, conditions or provisions of, or constitute a default under, (A) the organizational or charter documents of the Seller or (B) any contract or any judgment, decree or order to which the Seller is subject or by which the Seller is bound, or (ii) require any consent, license, permit, authorization, approval or other action by any Person or Governmental Body which has not yet been obtained or received. The execution, delivery and performance of this Agreement by the Seller or compliance with the provisions hereof by the Seller does not, and will not, violate any provision of any Law to which the Seller is subject or by which it is bound.

 

  

  

  

	
  

	
(c)

	
No Actions.   There are no lawsuits, actions or, to the best knowledge of the Seller, investigations, claims or demands or other proceedings pending or, to the best of the knowledge of the Seller, threatened against the Seller that, if resolved in a manner adverse to the Seller, would adversely affect the right or ability of the Seller to carry out its obligations set forth in this Agreement.

	
  

	
(d)

	
Title.  The Seller owns the Seller’s Shares free and clear of any Encumbrance whatsoever, except as contemplated by this Agreement. The Seller has not entered into nor is a party to any agreement that would cause the Seller to not own the Seller’s Shares free and clear of any Encumbrance, except as contemplated by this Agreement.

 

	 	
3.2  

	
Representations and Warranties of the Buyers.   Each Buyer represents and warrants to the Seller, as to him/herself and not as to any other Buyer, that:

 

	
  

	
(a)  

	
Due Authorization.  The execution and delivery of this Agreement and the consummation of the transactions contemplated hereunder to be carried out by it have been duly authorized by all necessary action on the part of the Buyer. This Agreement, and all agreements and documents executed and delivered pursuant to this Agreement, constitute valid and binding obligations of the Buyer, enforceable against the Buyer in accordance with its terms, subject to applicable Bankruptcy Laws and other laws or equitable principles of general application affecting the rights of creditors generally.

 

	
  

	
(b)  

	
No Conflicts.  Neither the execution or delivery of this Agreement by the Buyer nor the fulfillment or compliance by the Buyer with any of the terms hereof will, with or without the giving of notice and/or the passage of time, (i) conflict with, or result in a breach of the terms, conditions or provisions of, or constitute a default under, (A) the organizational or charter documents of the Buyer or (B) any contract or any judgment, decree or order to which the Buyer is subject or by which the Buyer is bound, or (ii) require any consent, license, permit, authorization, approval or other action by any Person or Governmental Body which has not yet been obtained or received. The execution, delivery and performance of this Agreement by the Buyer or compliance with the provisions hereof by the Buyer does not, and will not, violate any provision of any Law to which the Buyer is subject or by which it is bound.

 

	
  

	
(c)  

	
No Actions.  There are no lawsuits, actions or, to the best knowledge of the Buyer, investigations, claims or demands or other proceedings pending or, to the best knowledge of the Buyer, threatened against the Buyer that, if resolved in a manner adverse to the Buyer, would adversely affect the right or ability of the Buyer to carry out its obligations set forth in this Agreement.

  

  

  

ARTICLE IV

EVENTS OF DEFAULT AND TERMINATION

 

	 	
4.1  

	
Events of Default. The occurrence at any time with respect to a Party (the “Defaulting Party”) of any of the following events will constitute an event of default (an “ Event of Default ”) with respect to such party:

 

	
  

	
(a)  

	
Failure to Pay or Deliver.  The failure by a Party to make, when due, any payment under this Agreement or deliver the Seller’s Shares in accordance with this Agreement, if such failure is not remedied on or before the third Business Day after notice of such failure is given to the Defaulting Party.

 

	
  

	
(b)  

	
Breach of Agreement.  The failure by a Party to comply with or perform any agreement, covenant or obligation (other than a failure described in Section 4.1(a) , which will be governed by  Section 4.1(a) ) to be complied with or performed by such Party in accordance with this Agreement if such failure is not remedied on or before the tenth Business Day after notice of such failure is given to the Defaulting Party.

	
  

	
 

	
  

	
(c)  

	
Bankruptcy.  A Party (1) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (2) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (3) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (4) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any relief under any Bankruptcy Law, or a petition is presented for its winding-up or liquidation, and in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; (5) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all of its assets; (7) has a secured party take possession of all or substantially all of its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all of its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or rescinded, in each case within 30 days thereafter; (8) causes or is subject to any event with respect to it that, under applicable Law, has an analogous effect to any of the events described in clauses (1) through (7); or (9) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts.

	 	
4.2  

	
Liquidated Damages.   If at any time an Event of Default with respect to a Party has occurred and is continuing, the other party may claim a liquidated damage up to [1·]% of the Call Price. The Event of Default will not affect the effectiveness and performance of this Agreement.

  

  

  

ARTICLE V

MISCELLANEOUS PROVISIONS

 

	 	
5.1  

	
Further Assurances. Each Party will execute and/or cause to be delivered to each other Party such instruments and other documents, and will take such other actions, as such other Party may reasonably request (prior to, at or after the Closing) for the purpose of carrying out or evidencing any of the transactions contemplated by this Agreement.

	
  

	
 

	 	
5.2  

	
Notices.   Any notice or other communication required or permitted to be delivered to any Party will be in writing and will be deemed properly delivered, given and received upon dispatch by hand, courier or express delivery service with receipt confirmed by signature of the addressee, to the address set forth beneath the name of such Party below (or to such other address as such Party may specify in a written notice given to the other Parties):

 

	
If to the Seller:

	
Unit 04, 7/F, Bright Way Tower, No. 33

Mong Kok Road, Kowloon, Hong Kong

	  	
  

	
If to the Buyers:

 

	
Room 2503-2505, New World Center

No. 2609 Yitian Road, Shenzhen City,

Guangdong Province, PRC

	 	 
	
       With Copies to:

	
Guangdong GuoXin Law Firm

6th Floor, Shenzhen International Trust Building,

1010 Hongling Road, Shenzhen City,

Guangdong Province, PRC

	 	
5.3  

	
Time of The Essence.   Time is of the essence of this Agreement.

	
  

	
 

	 	
5.4  

	
Headings, Gender and Usage.   The headings contained in this Agreement are for convenience of reference only, will not be deemed to be a part of this Agreement and will not be referred to in connection with the construction or interpretation of this Agreement. For purposes of this Agreement: (a) the words “include” and “including” will be taken to include the words, “without limitation;” and (b) whenever the context requires, the singular number will include the plural, and vice versa; and each of the masculine, feminine and neuter genders will refer to the others.

	
  

	
 

	 	
5.5  

	
Governing Law and Language.   This Agreement, including all matters of construction, validity and performance, will in all respects be governed by, and construed in accordance with, the laws of Hong Kong (without giving effect to principles relating to conflict of laws).  This Agreement is written in English and the English language will govern any interpretation of this Agreement.

 

  

  

  

	 	
5.6  

	
Venue and Jurisdiction.   If any legal proceeding or other legal action relating to this Agreement is brought or otherwise initiated, the venue therefore will be in Hong Kong, which will be deemed to be a convenient forum.  Each of the Parties hereby expressly and irrevocably consents and submits to the jurisdiction of the courts in Hong Kong.

	
  

	
 

	 	
5.7  

	
Interpretation.  Each Party acknowledges that it has participated in the drafting of this Agreement, and any applicable rule of construction to the effect that ambiguities are to be resolved against the drafting party may not be applied in connection with the construction or interpretation of this Agreement.

	
  

	
 

	 	
5.8  

	
Successors and Assigns.  Each of the Parties will not assign this Agreement or any rights or obligations hereunder without the prior written consent of the other Party. The provisions hereof will inure to the benefit of, and be binding upon, the successors and permitted assigns of the Parties. This Agreement is binding upon, inures to the benefit of and is enforceable by Buyers, Seller and their respective successors and assigns.

	
  

	
 

	 	
5.9  

	
Waiver.

 

	
  

	
(a)  

	
No failure on the part of any Person to exercise any power, right, privilege or remedy under this Agreement, and no delay on the part of any Person in exercising any power, right, privilege or remedy under this Agreement, will operate as a waiver of such power, right, privilege or remedy; and no single or partial exercise of any such power, right, privilege or remedy will preclude any other or further exercise thereof or of any other power, right, privilege or remedy.

	
  

	
  

	
  

	
(b)  

	
No Person will be deemed to have waived any claim arising out of this Agreement, or any power, right, privilege or remedy under this Agreement, unless the waiver of such claim, power, right, privilege or remedy is expressly set forth in a written instrument duly executed and delivered on behalf of such Person; and any such waiver will not be applicable or have any effect except in the specific instance in which it is given.

 

	 	
5.10  

	
Entire Agreement; Amendment.  This Agreement constitutes the full and entire understanding and agreement between the Parties with regard to the subject matter hereof. Any term of this Agreement may be amended only with the written consent of each Party.

	
  

	
 

	 	
5.11  

	
Severability.  In the event that any provision of this Agreement, or the application of any such provision to any Person or set of circumstances, will be determined to be invalid, unlawful, void or unenforceable to any extent, the remainder of this Agreement, and the application of such provision to Persons or circumstances other than those as to which it is determined to be invalid, unlawful, void or unenforceable, will not be impaired or otherwise affected and will continue to be valid and enforceable to the fullest extent permitted by law.

	
  

	
 

	 	
5.12  

	
Entire Agreement.   This Agreement sets forth the entire understanding of the Parties relating to the subject matter hereof and supersedes all prior agreements and understandings among or between any of the parties relating to the subject matter thereof.

 

  

  

  

	 	
5.13  

	
Counterparts. This Agreement may be executed in several counterparts, each of which will constitute an original and all of which, when taken together, will constitute one agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

  

  

  

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and delivered as of the date first set forth above.

	
“SELLER”

	 	
ACKNOWLEDGED AND AGREED TO:

	
Meili Tsai, a Hong Kong individual

	 	
“COLLATERAL AGENT”

	  	 	
Guang Dong GuoXin Law Firm

	 	 	 
	
By:   /s/ Meili Tsai

	 	
By:   /s/ Yu Li  

	 	 	 
	
Name: Meili Tsai蔡美丽

	 	

Name: Yu Li    李郁

	  	 	  
	
“BUYER”

	 	
“BUYER”

	
[Yunlu Yin], an individual citizen of the People’s Republic of 

	 	
[Yanming Lv], an individual 

	China  	 	citizen of the People’s Republic   
	 	 	of China 
	 	 	 
	
By:    /s/Yunly Yin

	 	
By:     /s/ Yanming Lv

	 	 	 
	
Name: Yunlu Yin殷允录

	 	
Name: Yanming Lv    吕延明

	  	 	  
	
“BUYER”

	 	
“BUYER”

	
[Shouqiang Han], an individual citizen of the People’s Republic 

	 	
[Shulan Li], an individual citizen 

	of China 	 	of the People’s Republic of  
	  	 	China  
	 	 	 
	
By:    /s/ Shouqiang Han

	 	
By:    /s/Shulan Li

	 	 	 
	
Name: Shouqiang Han韩寿强

	 	
Name: Shulan Li    李淑兰

	  	 	  
	
“BUYER”

	 	
“BUYER”

	
[Qingdong Zeng], an individual citizen of the People’s Republic

	 	
[Junyan Su], an individual citizen of 

	
of China

	 	the People’s Republic of China  
	  	 	
 

	
By:    /s/Qingdong Zeng

	 	

By:    /s/Junyan Su

	 	 	 
	
Name: Qingdong Zeng     曾庆东

	 	
Name: Junyan Su     苏俊岩

 

  

  

  

	
“BUYER”

	 	
“BUYER”

	
[Hong Zhang], an individual citizen of the People’s Republic

	 	
[Guojun Zhao], an individual citizen 

	
of China

	 	of the People’s Republic of China  
	  	 	
 

	
By:    /s/Hong Zhang

	 	

By:    /s/ Guojun Zhao

	 	 	 
	
Name: Hong Zhang 张红

	 	
Name: Guojun Zhao     赵国军  

	 	 	 
	
“BUYER”

	 	
“BUYER”

	
[Feng Jin], an individual citizen of the People’s Republic

	 	
[Dandan Wang], an individual citizen 

	
of China

	 	of the People’s Republic of China  
	  	 	
 

	
By:    /s/ Feng Jin

	 	

By:    /s/ Dandan Wang

	 	 	 
	
Name: Feng Jin     金凤

	 	
Name: Dandan Wang     王丹丹  

	 	 	 
	
“BUYER”

	 	
“BUYER”

	
[Boliang Zhu], an individual citizen of the People’s Republic

	 	
[Zhihao Pan], an individual citizen of 

	
of China

	 	the People’s Republic of China  
	  	 	
 

	
By:    /s/ Boliang Zhu

	 	

By:    /s/ Zhihao Pan

	 	 	 
	
Name: Boliang Zhu    朱伯良

	 	
Name: Zhihao Pan     盘志豪  

	 	 	 
	
“BUYER”

	 	
“BUYER”

	
[Zhengang Chi], an individual citizen of the People’s Republic

	 	
[ZhenCheng Huang], an individual 

	
of China

	 	citizen of the People’s Republic of China  
	  	 	
 

	
By:    /s/ Zhengang Chi

	 	

By:     /s/ Zhencheng Huang

	 	 	 
	
Name: Zhengang Chi     迟振刚

	 	
Name: Zhencheng Huang    黄振成  

	 	 	 
	
“BUYER”

	 	
“BUYER”

	
[Yiting Zhang], an individual citizen of the People’s Republic

	 	
[Yanliang Song], an individual citizen of 

	
of China

	 	the People’s Republic of China  
	  	 	
 

	
By:    /s/ Yiting Zhang

	 	
By:     /s/ Yanling Song

	 	 	 
	
Name: Yiting Zhang    张易庭

	 	
Name: Yanliang Song    宋延亮

  

  

  

	
“BUYER”

	 	
“BUYER”

	
[Xueye Jing], an individual citizen of the People’s Republic

	 	
[Yan Zhang], an individual citizen of the 

	
of China

	 	People’s Republic of China  
	  	 	
 

	
By:   /s/ Xueye Jing

	 	

By:    /s/ Yan Zhang

	 	 	 
	
Name: Xueye Jing    景雪野

	 	
Name: Yan Zhang 张燕  

	 	 	 
	
“BUYER”

	 	
“BUYER”

	
[Xianming Zeng], an individual citizen of the People’s Republic

	 	
[Shunli Wang], an individual citizen of the 

	
of China

	 	People’s Republic of China  
	  	 	
 

	
By:   /s/ Xianming Zeng

	 	

By:    /s/Shunli Wang

	 	 	 
	
Name: Xianming Zeng    曾宪明

	 	
Name: Shunli Wang   王顺利  

	 	 	 
	
“BUYER”

	 	
“BUYER”

	
[Renyuan Su], an individual citizen of the People’s Republic

	 	
[Qingwei Meng], an individual citizen of 

	
of China

	 	the People’s Republic of China  
	  	 	
 

	
By:   /s/ Renyuan Su

	 	

By:     /s/ Qingwei Meng

	 	 	 
	
Name: Renyuan Su    粟任元

	 	
Name: Qingwei Meng    孟庆伟  

	 	 	 
	
“BUYER”

	 	
“BUYER”

	
[Nan Li], an individual citizen of the People’s Republic

	 	
[Naihua Hu], an individual citizen of the People’s Republic

	
of China

	 	
of China

	  	 	  
	
By:   /s/ Nan Li

	 	
By:     /s/ Naihua Hu

	 	 	 
	
Name: Nan Li     李楠

	 	
Name: Naihua Hu    胡乃华

	  	 	  
	
“BUYER”

	 	
“BUYER”

	
[Li Li], an individual citizen of the People’s Republic

	 	
[Hong Li], an individual citizen of the People’s Republic

	
of China

	 	
of China

	  	 	  
	
By:   /s/ Li Li

	 	
By:   /s/ Hong Li

	 	 	 
	
Name: Li Li     李力

	 	
Name: Hong Li    李洪

 

  

  

  

	
“BUYER”

	 	
“BUYER”

	
[Hanjun Liu], an individual citizen of the People’s Republic

	 	
[Fangyuan Song], an individual citizen of the People’s Republic

	
of China

	 	
of China

	  	 	  
	
By:    /s/ Hanjun Liu

	 	
By:   /s/ Fangyuan Song

	 	 	 
	
Name: Hanjun Liu    刘汉军

	 	
Name: Fangyuan Song      宋放远

	  	 	  
	
“BUYER”

	 	
“BUYER”

	
[Dan Li], an individual citizen of the People’s Republic

	 	
[An Fu], an individual citizen of the People’s Republic

	
of China

	 	
of China

	  	 	  
	
By:   /s/ Dan Li

	 	
By:   /s/ An Fu

	 	 	 
	
Name: Dan Li     李丹

	 	
Name: An Fu      傅安

	  	 	  
	
“BUYER”

	 	 
“BUYER”

	
[Chaobo Song], an individual citizen of the People’s Republic

	 	 
Yanmin Song, an individual citizen of the People’s Republic

	
of China

	 	 
of China  

	  	 	  
	
By:    /s/ Chaobo Song

	 	 
By:   /s/ Yanmin Song   

	 	 	 
	
Name: Chaobo Song     宋朝波

	 	 
Name: Yanmin Song     宋延敏

	  	 	  

 

 

 

 

 

Attachments: 

Exhibit A   Certain Definitions

Exhibit B   Form of Call Exercise Notice

EXHIBIT A

CERTAIN DEFINITIONS

For purposes of this Agreement (including this Exhibit A):

“Bankruptcy Law” means any Law of any jurisdiction relating to bankruptcy, insolvency, corporate reorganization, company arrangement, civil rehabilitation, special liquidation, moratorium, readjustment of debt, appointment of a conservator, trustee or receiver, or similar debtor relief.

“Call Exercise Notice” is defined in Section 1.3.

“Call Price” is defined in Section 1.4(a).

“Call Right” is defined in Section 1.1.

“Collateral Agent” is defined in Section 2.5(a).

“Conditions” means Conditions 1 through 4, in the aggregate.

“Effective Date” is defined in the Preamble.

“Encumbrance” means any lien, pledge, hypothecation, charge, mortgage, security interest, encumbrance, equity, trust, equitable interest, claim, preference, right of possession, lease, tenancy, license, encroachment, covenant, infringement, interference, Order, proxy, option, right of first refusal, preemptive right, community property interest, legend, defect, impediment, exception, reservation, limitation, impairment, imperfection of title, condition or restriction of any nature (including any restriction on the transfer of any asset, any restriction on the receipt of any income derived from any asset, any restriction on the use of any asset and any restriction on the possession, exercise or transfer of any other attribute of ownership of any asset).

“Exchange Agreement” is defined in the Recitals.

“Exchange Transaction” is defined in the Recitals.

“Exercise Date” is defined in Section 1.3.

“Exercise Period” is defined in Section 1.2.

“Expiration Date” is defined in Section 1.2.

  

  

  

 

“GAAP” means generally accepted accounting principles consistently applied during the relevant period.

“Governmental Body” means any: (a) nation, principality, state, commonwealth, province, territory, county, municipality, district or other jurisdiction of any nature; (b) federal, state, local, municipal, foreign or other government; (c) governmental or quasi-Governmental Body of any nature (including any governmental division, subdivision, department, agency, bureau, branch, office, commission, council, board, instrumentality, officer, official, representative, organization, unit, body or Entity and any court or other tribunal); (d) multi-national organization or body; or (e) individual, Entity or body exercising, or entitled to exercise, any executive, legislative, judicial, administrative, regulatory, police, military or taxing authority or power of any nature.

“Holdco” is defined in the Recitals.

“Initial Call Date” is defined in Section 1.2.

“Law” means any national, federal, state, local, municipal, foreign or other law, statute, legislation, constitution, principle of common law, resolution, ordinance, code, edict, decree, proclamation, treaty, convention, rule, regulation, ruling, directive, pronouncement, requirement, specification, determination, decision, opinion or interpretation issued, enacted, adopted, passed, approved, promulgated, made, implemented or otherwise put into effect by or under the authority of any Governmental Body.

“Operating Company” is defined in the Recitals.

“Party” and “Parties” are defined in the Preamble to this Agreement.

“Person” means an individual, a corporation, a partnership, an association, a trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

“Seller’s Shares” is defined in Section 1.1.

“Shell Company” is defined in the Recitals.

“US GAAP” means United States Generally Accepted Accounting Principles consistently applied.

  

  

  

 EXHIBIT B

FORM OF CALL EXERCISE NOTICE

[Date]

TSAI, MEI LI, (the “Seller”)

Unit 04, 7/F, Bright Way Tower,

No. 33 Mong Kok Road, Kowloon,

Hong Kong

 

	
  

	
Re:

	
Earn-In Agreement dated [             ] (the “Earn-In Agreement”), between [        ] (the “Buyer”) and  (the “Seller”)

Dear Ms. Tsai,

In accordance with Section 1.3 of the Earn-In Agreement, the Buyer hereby provides this notice of exercise of the Call Right in the manner specified below:

	
  

	
(a)

	
The Buyer hereby exercises its Call Right with respect to the Seller’s Shares pursuant to the Earn-In Agreement.

	
  

	
(b)

	
The Buyer will pay the sum of $____________ to the Seller.

	
  

	
(d)

	
Pursuant to this exercise, the Seller will deliver to _______________ the Seller’s Shares in accordance with the instructions attached hereto.

	
Dated: _______________, ______

	  
	  	  
	  	
Buyer

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