Document:

Unassociated Document

Equity Transfer Agreement

 

Party A (Transferor): Wuhan Aoxin Tianli Enterprise Investment Management Co., Ltd

 

Party B (Transferee): Guangxi Hongzhen Investment Co., Ltd

 

Party C (Transfer Target): Hubei Hang-ao Servo-valve Manufacturing Technology Co., Ltd

WHEREAS, Party A legally owns 88% Equity of Party C, and Party A voluntarily wants to transfer 88% equity of Party C to Party B; AND

 

WHEREAS, Party B agrees to accept the 88% equity of Party C; AND

 

WHEREAS, the Board of Shareholders of Party A also consents to transfer 88% equity of Party C to Party B;

 

NOW, THEREFORE, in consideration of the foregoing premises and the friendly negotiations among Party A, B and C, the following equity transfer agreement is entered in accordance with the principle of equality and mutual benefit.

 

Section I Equity Transfer

 

	
  

	
1.

	
Party A consents to transfer 88% equity of Party C to Party B, Party B agrees to accept the equity;

	
  

	
2.

	
The above-mentioned equity shall include all the attached interests and rights under that equity, and shall be free and clear of (including, but not limited to) all liens, pledges, encumbrances, charges, restrictions or known claims of any kind, nature or description.

	
  

	
3.

	
When the agreement takes effect, Party A shall not burden any obligations and responsibilities for the operational management and claims and Debts of Party C.

Section II Transferring Price and the Payment Methods

 

	
  

	
1.

	
Upon the terms and subject to the conditions of this Agreement, Party A agrees to transfer the 88% equity of Party C to Party B at the price of RMB 48.4 million Yuan, Party B agrees the price for the equity.

	
  

	
2.

	
Party B agrees to make a prepayment of RMB 4 million Yuan to the bank accounts designated by Party A upon the execution of this agreement, and the remaining purchase price will be paid before December 15, 2015.

	
  

	
3.

	
Party A agrees that Party B can start to process the business registration upon the payment of the remaining purchase price.

 

  

  

  

 

Section III Representations of Party A

 

	
  

	
1.

	
Party A is the exclusive owner of the transferring equity set forth in Section I.

	
  

	
2.

	
From the effective date of the agreement, Party A shall fully quit from the operations of Party C, and shall not have the rights of the distribution of the assets, properties and profits.

Section IV Representations of Party B

 

	
  

	
1.

	
Party B acknowledges and complies with the Amended Articles of Association of Party C;

	
  

	
2.

	
Party B ensures to pay the purchase price in terms of the payment deadline and method stipulated in Section II.

Section V Expense from the Equity Transfer

 

All the parties agree all the transferring fees and related expenses shall be undertaken by Party B.

Section VI Liability for Breach of Contract

 

	
  

	
1.

	
If any party violates or fails to implement any clauses of the agreement, the breaching party should indemnify all the economic losses of the non-breaching party;

	
  

	
2.

	
If party B fails to pay the equity purchase price timely according to the regulations of Section II, party A shall have the right to charge the overdue fine at the rate of 5‰ per day commencing the date of the deadline stipulated in Section II. When Party B pays the overdue fine, but the loss caused to Party A is over the overdue fine, or other damages are caused due to the breaching of Party B, it shall not impact Party A to claim for the indemnification regarding to the excess portion between the overdue fine and the loss and other damages.

Section VII Confidentiality

 

Both Parties shall have the obligations to keep confidential regarding each party’s commercial information acquired during the performing of the agreement, the confidentiality is still valid and effective upon the termination of the agreement. Should any party violates the confidential clause and causes loss to the other party, it should undertake all the charges and losses of the other party.

 

  

  

  

 

Section VIII   Effective Clauses and Miscellaneous

 

	
  

	
1.

	
This agreement shall be effective upon the execution of Party A, Party B and Party C.

	
  

	
2.

	
Any disputes caused by the implement of this agreement must be first settled by Party A and Party B pursuant to the principle of friendly negotiations. In case no such settlement can be reached, either party has the right to file a suit to the People’s court where Party A is located. 

	
  

	
3.

	
This agreement is in triplicate, each of the parties holds one copy, and all of which shall be deemed to be an original and share the same legal effect.

Party A (Transferor): Wuhan Aoxin Tianli Enterprise Investment Management Co., Ltd (Seal)

Legal Person or authorized representative: Hanying Li (signature)

Party B (Transferee): Guangxi Hongzhen Investment Co., Ltd (Seal)

Legal Person or authorized representative: Hanzhi Shao (signature)

Party C (Transfer Target): Hubei Hang-ao Servo-valve Manufacturing Technology Co., Ltd (Seal)

Legal Person or authorized representative: Ning Liu (signature)

 

Date: November 13, 2015Unassociated Document

Letter of Agreement

 

Party A:  Aoxin Tianli Group, Inc.

 

         Wuhan Aoxin Tianli Enterprise Investment Management Co., Ltd

 

Party B:  Xiangyang Guosheng Qirui Investment Co., Ltd.

 

Party C: Hubei Hang-ao Servo-valve Manufacturing Technology Co., Ltd.

 

WHEREAS, Party A holds 88% equity interest in Party C; Party B is an investment company established by the management group of Party C and holds 1,047,000 common shares of Party A after Party A acquired Party C in July, 2014. The 1,047,000 shares were deposited into escrow (the “Earn-out Shares”) to be held for disbursement to Party B upon Party C achieving certain Target Net Income in each of the fiscal years ending December 31, 2014, 2015 and 2016.

 

WHEREAS, Party A intends to sell its 88% equity interest in Party C to a third party;

 

THEREFORE, in consideration of the foregoing premises and the friendly negotiations between Party A and B, the following agreement is entered:

 

	
  

	
1.

	
If Party A sells the above-mentioned equity interest successfully, the previous Escrow Agreement executed between Party A and Party B will be cancelled automatically and the 1,047,000 shares of Party A will be delivered to Party B. However, the Earn-out shares can’t be released until the end of March 2017 as previously promised in the Stock Purchase Agreement;

 

	
  

	
2.

	
If Party A doesn’t sell the above-mentioned equity interest successfully, the previous Escrow Agreement will continue to be effective.

 

Party A:  Aoxin Tianli Group, Inc.

 

        Wuhan Aoxin Tianli Enterprise Investment Management Co., Ltd (seal)

 

Legal person or authorized representative: (signature)

 

Party B: Xiangyang Guosheng Qirui Investment Co., Ltd. (seal)

 

Legal person or authorized representative: (signature)

 

                                         November 5, 2015EXHIBIT
10.1

 

Amendment No. 6

to Credit Agreement

 

This Amendment No. 6 to Credit Agreement
is dated as of October 13, 2015, and is between CTI Industries Corporation,
an Illinois corporation (the “Borrower”); CTI Supply, Inc.,
an Illinois corporation f/k/a CTI Helium, Inc., and a Wholly-Owned Subsidiary of the Borrower, in its capacity as a
guarantor (the “Subsidiary Guarantor”); and BMO Harris Bank N.A.,
a national banking association, successor to Harris N.A. (the “Bank”).

 

The Borrower and the Bank entered into a Credit
Agreement dated as of April 29, 2010 (the “Credit Agreement”), under which the Bank has extended certain
credit facilities to the Borrower.

 

In connection with the Credit Agreement, the
Subsidiary Guarantor entered into a Guaranty dated as of April 29, 2010 (the “Subsidiary Guaranty”), under
which, among other things, the Subsidiary Guarantor guarantees the prompt and complete payment and performance of the Obligations.

 

The parties now desire to amend the Credit Agreement
in certain respects.

 

The parties therefore agree as follows:

 

1.          Definitions.
Defined terms used but not defined in this agreement are as defined in the Credit Agreement.

 

2.          Amendments
to Credit Agreement. (a) The second sentence of section 1.4 of the Credit Agreement (which sentence begins, “The
Revolving Credit may be utilized by the Borrower...”) is hereby amended to read in its entirety as follows:

 

“The Revolving Credit may be utilized by the Borrower
in the form of Revolving Loans and Letters of Credit, all as more fully hereinafter set forth, provided that the aggregate principal
amount of Revolving Loans and Letters of Credit outstanding at any one time shall not exceed the Revolving Credit Availability.”

 

    	 	1	 

     

    

  

(b)          Section 1.4
of the Credit Agreement is hereby further amended by inserting the following new sentence at the end of that section:

 

“The Bank shall have the right, at any time and
from time to time in the exercise of its reasonable discretion, to establish, modify, or eliminate reserves (including, without
limitation, in respect of Credit Product Obligations) on the Revolving Credit Commitment, the Borrowing Base, or, without duplication,
both the Revolving Credit Commitment and the Borrowing Base.”

 

(c)          The
definition of “Borrowing Base” in section 5.1 of the Credit Agreement is hereby amended to read in its entirety
as follows, effective as of October 1, 2015:

 

“            “Borrowing Base” means,
as of any time it is to be determined, the sum of: (a) 85% of the then outstanding unpaid amount of Eligible Receivables; plus
(b) the lesser of (i) $6,500,000 and (ii) 60% of the value (computed at the lower of market or cost using the first-in/first-out
method of inventory valuation applied by the Borrower in accordance with GAAP) of Eligible Inventory; (c) the Temporary Overadvance
Amount; provided that the Borrowing Base shall be computed only as against and on so much of the Collateral as is included
on the certificates to be furnished from time to time by the Borrower pursuant to Section 8.5(a) hereof and, if required
by the Bank pursuant to any of the terms hereof or any Collateral Document, as verified by such other evidence required to be furnished
to the Bank pursuant hereto or pursuant to any such Collateral Document.”

 

(d)          The
definition of “Revolving Credit Availability” in section 5.1 of the Credit Agreement is hereby amended to read
in its entirety as follows:

 

“            “Revolving Credit Availability”
means, as of any time it is to be determined, an amount equal to the lesser of (a) the result of (i) the Revolving
Credit Commitment at such time, minus (ii) the amount of reserves then imposed on the Revolving Credit Commitment by
the Bank in accordance with this Agreement, and (b) the result of (i) the Borrowing Base as then determined and computed,
minus (ii) the amount of reserves then imposed on the Borrowing Base by the Bank in accordance with this Agreement.”

 

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(e)          The
definition of “Revolving Credit Commitment” in section 5.1 of the Credit Agreement is hereby amended to read in
its entirety as follows:

 

“            “Revolving Credit Commitment”
means an amount equal to Twelve Million and 00/100 Dollars ($12,000,000.00), as such amount may be reduced pursuant
to the terms of this Agreement.”

 

(f)          Section 5.1
of the Credit Agreement is hereby further amended by inserting the following new definition in the appropriate alphabetical order,
effective as of October 1, 2015:

 

“            “Temporary Overadvance Amount”
means (a) on and after October 1, 2015, through and including April 30, 2016, an amount equal to $1,000,000;
and (b) at any other time (including on and after May 1, 2016), an amount equal to $0.”

 

(g)          Exhibit F
to the Credit Agreement is hereby amended to read in its entirety as set forth in Exhibit F to this agreement.

 

3.          Reaffirmation
of Subsidiary Guaranty. The Subsidiary Guarantor hereby expressly does each of the following:

 

		(1)	consents to the execution by the Borrower and the Bank
of this agreement;

 

		(2)	acknowledges that the “Indebtedness” (as defined
in the Subsidiary Guaranty) includes all of the “Obligations” under and as defined in the Credit Agreement, as amended
from time to time (including as amended by this agreement);

 

		(3)	acknowledges that the Subsidiary Guarantor does not have
any set-off, defense, or counterclaim to the payment or performance of any of the obligations of the Borrower under the Credit
Agreement or the Subsidiary Guarantor under the Subsidiary Guaranty;

 

		(4)	reaffirms, assumes, and binds itself in all respects to
all of the obligations, liabilities, duties, covenants, terms, and conditions contained in the Subsidiary Guaranty;

 

		(5)	agrees that all such obligations and liabilities under
the Subsidiary Guaranty continue in full force and that the execution and delivery of this agreement to, and its acceptance by,
the Bank will not in any manner whatsoever do any of the following:

 

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		(A)	impair or affect the liability of the Subsidiary Guarantor
to the Bank under the Subsidiary Guaranty;

 

		(B)	prejudice, waive, or be construed to impair, affect, prejudice,
or waive the rights and abilities of the Bank at law, in equity, or by statute against the Subsidiary Guarantor pursuant to the
Subsidiary Guaranty; or

 

		(C)	release or discharge, or be construed to release or discharge,
any of the obligations and liabilities owing to the Bank by the Subsidiary Guarantor under the Subsidiary Guaranty; and

 

		(6)	represents and warrants that each of the representations
and warranties made by the Subsidiary Guarantor in any of the documents executed in connection with the Loans remain true and
correct as of the date of this agreement.

 

4.          Representations
and Warranties. To induce the Bank to enter into this agreement, the Borrower hereby represents to the Bank as follows:

 

		(1)	that the Borrower is duly authorized to execute and deliver
this agreement and is and will continue to be duly authorized to borrow monies under the Credit Agreement, as amended by this
agreement, and to perform its obligations under the Credit Agreement, as amended by this agreement;

 

		(2)	that the execution and delivery of this agreement and the
performance by the Borrower of its obligations under the Credit Agreement, as amended by this agreement, do not and will not conflict
with any provision of law or of the articles of organization or operating agreement of the Borrower or of any agreement binding
upon the Borrower;

 

		(3)	that the Credit Agreement, as amended by this agreement,
is a legal, valid, and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, except
as enforceability might be limited by bankruptcy, insolvency, or other similar laws of general application affecting the enforcement
of creditors’ rights or by general principles of equity limiting the availability of equitable remedies;

 

		(4)	that the representation and warranties set forth in section 6
of the Credit Agreement, as amended by this agreement, are true and correct with the same effect as if those representations and
warranties had been made on the date hereof, except that all references to the financial statements mean the financial statements
most recently delivered to the Bank and except for changes specifically permitted under the Credit Agreement, as amended by this
agreement;

 

    	 	4	 

     

    

  

		(5)	that the Borrower has complied with and is in compliance
with all of the covenants set forth in the Credit Agreement, as amended by this agreement, including the covenants stated in section 8
of the Credit Agreement; and

 

		(6)	that as of the date of this agreement no Default and no
Event of Default under section 10 of the Credit Agreement, as amended by this agreement, has occurred or is continuing.

 

		5.	Conditions. The effectiveness of this agreement
is subject to satisfaction of the following conditions:

 

		(1)	that the Bank has received the following:

 

		(A)	a copy of this agreement, duly executed by the parties;
and

 

		(B)	all other documents, certificates, resolutions, and opinions
of counsel as the Bank requests; and

 

		(2)	that all legal matters incident to the execution and delivery
of this agreement are satisfactory to the Bank and its counsel.

 

6.          General.
(a) This agreement and the rights and duties of the parties hereto are governed by, and are to be construed in accordance with,
the internal laws of State of Illinois without regard to principles of conflicts of laws. Wherever possible each provision of the
Credit Agreement and this agreement is to be interpreted in such manner as to be effective and valid under applicable law, but
if any provision of the Credit Agreement and this agreement is prohibited by or invalid under any such law, that provision will
be deemed ineffective to the extent of that prohibition or invalidity, without invalidating the remainder of that provision or
the remaining provisions of the Credit Agreement and this agreement.

 

(b)          This
agreement is a Loan Document.

 

(c)          This
agreement binds each party and their respective successors and assigns, and this agreement inures to the benefit of each party
and the successors and assigns of the Bank.

 

    	 	5	 

     

    

  

(d)          Except
as specifically modified or amended by the terms of this agreement, the terms and provisions of the Credit Agreement, the Subsidiary
Guaranty, and the other Loan Documents are incorporated by reference herein and in all respects continue in full force and effect.
The Borrower, by execution of this agreement, hereby reaffirms, assumes, and binds itself to all of the obligations, duties, rights,
covenants, terms, and conditions contained in the Credit Agreement and the other Loan Documents to which it is a party.

 

(e)          Each
reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” or words of like
import, and each reference to the Credit Agreement in any and all instruments or documents delivered in connection therewith, are
deemed to refer to the Credit Agreement, as amended by this agreement.

 

(f)          The
Borrower shall pay all costs and expenses in connection with the preparation of this agreement and other related loan documents,
including, without limitation, reasonable attorneys’ fees and time charges of attorneys who are employees of the Bank or
any affiliate or parent of the Bank. The Borrower shall pay any and all stamp and other taxes, UCC search fees, filing fees, and
other costs and expenses in connection with the execution and delivery of this agreement and the other instruments and documents
to be delivered hereunder, and agrees to save the Bank harmless from and against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay such costs and expenses.

 

(g)          The
Borrower hereby waives and releases any and all current existing claims, counterclaims, defenses, or set-offs of every kind and
nature which it has or might have against the Bank arising out of, pursuant to, or pertaining in any way to the Credit Agreement,
any and all documents and instruments in connection with or relating to the foregoing, or this agreement. The Borrower hereby further
covenants and agrees not to sue the Bank or assert any claims, defenses, demands, actions, or liabilities against the Bank arising
out of, pursuant to, or pertaining in any way to the Credit Agreement, any and all documents and instruments in connection with
or relating to the foregoing, or this agreement.

 

(h)          The
parties may sign this agreement in several counterparts, each of which will be deemed an original but all of which together will
constitute one instrument.

 

[Signature pages follow]

 

    	 	6	 

     

    

  

The parties are signing this Amendment No. 6
to Credit Agreement as of the date stated in the introductory clause.

 

	 	CTI Industries Corporation
	 	 	 
	 	By:	/s/ Stephen M. Merrick
	 	Name:	Stephen M. Merrick
	 	Title:	President
	 	 	 
	 	CTI Supply, Inc.
	 	(f/k/a CTI Helium, Inc.)
	 	 	 
	 	By:	/s/ Stephen M. Merrick
	 	Name:	Stephen M. Merrick
	 	Title:	President
	 	 	 
	 	BMO Harris BANK N.A.
	 	 	 
	 	By:	/s/ Joseph C. Mikulskis
	 	Name:	Joseph C. Mikulskis
	 	Title:	Senior Vice President

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