Document:

ex101.htm

Exhibit 10.1

SINO-FOREIGN EQUITY JOINT VENTURE

 

WORLDWIDE ENERGY AND MANUFACTURING (NANTONG) CO., LTD.

 

JOINT VENTURE CONTRACT

 

CHAPTER 1  GENERAL PRINCIPLES

 

In accordance with the Sino-foreign Equity Joint Venture Law of the People’s Republic of China (the “Equity Joint Venture Law”) and other relevant PRC laws and regulations, Rugao Brother Solar Energy and Technology, Ltd. and Worldwide Energy and Manufacturing USA, Inc., agree to change the nature of the cooperative joint venture established by the Parties in Rugao City, Jiangsu Province, Worldwide Energy and Manufacturing (Nantong) Co., Ltd., to an equity joint venture and therefore to enter into this Equity Joint Venture Contract (“Contract”) through friendly consultations based on the principles of equality and mutual benefit.

 

CHAPTER 2  PARTIES TO THE JOINT VENTURE

 

	
Article 1  

	
This Contract is made by and between the following parties ( “Parties”):

 

	
1.  

	
Rugao Brother Solar Energy and Technology, Ltd. (“Party A”), an enterprise registered with State Administration of Industry and Commerce, Rugao City Bureau, with its legal address at Qifeng Road, Rucheng Town, Rugao City, Jiangsu Province

 

Legal Representative: Wang Jiangjun

Title: Executive Director,

Nationality: PRC

Telephone No.: 0513-87980321

Facsimile:  0513-87970321

 

	
2.  

	
Worldwide Energy and Manufacturing USA, Inc. (“Party B”), a company incorporated in USA with its legal address at 408 North Canal Street, Units A and B, South San Francisco, CA 94080, USA.

 

Legal Representative: Wang Yong

Title: Chairman of the Board

Nationality: USA

Telephone No.: +1-650-794-9888

Facsimile being +1-650-794-9878

 

  

1

  

 

CHAPTER 3  ESTABLISHMENT OF THE JOINT VENTURE

 

	
Article 2  

	
In accordance with the Equity Joint Venture Law and other relevant PRC laws and regulations, Party A and Party B agree to establish an equity joint venture in China.

 

	
Article 3  

	
The name of the equity joint venture is Worldwide Energy and Manufacturing (Nantong) Co., Ltd. (the “Company”)

 

The name of the Company in Chinese is “南通美能得太阳能电力科技有限公司”

 

The name of the Company in English is “Worldwide Energy and Manufacturing (Nantong) Co., Ltd.”

 

The legal address of the Company is Qifeng Road, Rugao City, Jiangsu Province.

 

	
Article 4  

	
Any business activities of the Company shall be subject to the PRC laws and regulations.

 

	
Article 5  

	
The Company is a limited liability company.  Each Party to the Company shall be liable to the debts of the Company within the limit of the capital subscribed by it, share the profits, and undertake the risks and losses in proportion to each of their contributions to the registered capital.

 

CHAPTER 4  OBJECTIVES, SCOPE AND SCALE OF OPERATION

 

	
Article 6  

	
The purpose of the Company: to achieve satisfactory financial returns through the manufacture and sale of proper products in international market by sufficiently utilizing Party A’s current manufacturing and technology conditions and Party B’s advantage in finance.

 

	
Article 7  

	
The business scope of the Company is to develop, product and process solar energy photovoltaic modules and its component parts; to sell self-made products; and engage in import and export business with respect to the abovementioned products (excluding the distribution of imported products).

 

	
Article 8  

	
The production scale in the early stage of the Company is fifty (50) megawatts solar energy photovoltaic component parts per year.

 

CHAPTER 5  TOTAL INVESTMENT AND REGISTERED CAPITAL

 

	
Article 9  

	
The total amount of investment of the Company shall be US$ 25 Million (US$ 25,000,000.00).

 

  

2

  

 

	
Article 10  

	
The total amount of capital contribution made by the Parties to the Company shall be US$ 10 Million (US$10,000,000.00) which will be the registered capital of the Company, among which:

 

Party A shall contribute US$ 4.9 Million (US$4,900,000.00) representing forty-nine percent (49%) of the registered capital of the Company;

 

Party B’s shall contribute US$ 5.1 Million (US$5,100,000.00) representing fifty-one percent (51%) of the registered capital of the Company.

 

	
Article 11  

	
The payment method of the contributions is as follows:

 

Party A shall contribute US$ 4.9 Million (US$4,900,000.00), among which US$ 0.1 Million (US$10,000.00) shall be contributed in the form of Renminbi and US$ 4.89 Million (US$4,890,000.00) shall be contributed in the form of US Dollars.

 

Party B shall contribute US$ 5.1 Million (US$5,100,000.00) in the form of US Dollars.

 

The exchange rate for Renminbi and US Dollars shall be the Basic Rate as published by People’s Bank of China on the date of receipt of the contribution.

 

The cash and spot exchanges subscribed by the parties shall be used as a whole after its injection to the account of the Company.

 

Where either Party makes the investment in kind, the price and quality of which shall be acknowledged by the other Party.

 

	
Article 12  

	
The registered capital subscribed by each Party has been fully contributed.

 

	
Article 13  

	
Any transfer by a Party of all or any part of its contribution in the Company shall be consented by the other Party.  And an application with respect to such transfer shall be submitted to the original Approval Authority.  Within thirty (30) days following the approval by the original Approval Authority, the Company shall register such change with the original Registration Authority.

 

Where a Party transfers all or part of its contribution, the other Party shall have the right of first refusal under the same conditions.

 

  

3

  

 

CHAPTER 6  RESPONSIBILITIES OF THE PARTIES

 

	
Article 14  

	
The Parties shall take most effective and efficient measures to achieve the purpose and objectives of the Company.

 

Party A shall complete the following matters:

 

	
1.  

	
Be responsible to handle matters in connection with the establishment of the Company, such as filing applications for approvals and receipt of business license with relevant PRC authorities;

 

	
2.  

	
Contribute the registered capital in accordance with Article 10, Article 11 and Article 12 hereof;

 

	
3.  

	
Assist the Company in procurement within China;

 

	
4.  

	
Be responsible to recommend employees from Party A’s original employees to the Company on merit per the Company’s needs, and to assist the Company in conducting recruitment from the public when the need of the Company for employees cannot be satisfied;

 

	
5.  

	
Assist foreign employees to obtain entry visas;

 

	
6.  

	
Provide market information in respect of the products of the Company;

 

	
7.  

	
Handle other matters entrusted to it by the Company.

 

Party B shall complete the following matters:

 

	
1.  

	
Subscribed the registered capital in accordance with Article 10, Article 11 and Article 12 hereof;

 

	
2.  

	
Assist Party A to process formalities such as approvals, registrations, applications for business license and etc.;

 

	
3.  

	
Assist Party A in the sales of the product of the Company;

 

	
4.  

	
Handle other matters entrusted to it by the Company.

 

  

4

  

 

CHAPTER 7  SALES OF THE PRODUCTS

 

	
Article 15  

	
More than ninety-five percent (95%) of the Company’s products shall be directly exported.

 

	
Article 16  

	
Party A and Party B shall jointly be responsible for the sale of such products to be exported.  Where the price of the products to be sold by the Company is higher than the same to be sold by Party B, the Company may directly sell the products.

 

To facilitate the sale of the Company’s products, the Company may open branch companies inside or outside the territory of China upon approvals by relevant PRC authorities.

 

	
Article 17  

	
Trademarks to be used on the Company’s product shall be discussed by Board of the Company.  It shall be used upon approval and registration by the Trademark Office of the State Administration for Industry and Commerce in accordance with relevant provisions of the Law of People’s Republic of China on Trademarks.

 

CHAPTER 8  BOARD OF DIRECTORS

 

	
Article 18  

	
The date of the issuance of business license of the Company shall be the date of the establishment of Board of Directors of the Company (“Board”).

 

	
Article 19  

	
The Board shall consist of three (3) directors (“Directors”), among which, one (1) shall be appointed by Party A and two (2) by Party B.  Chairman shall be appointed by Party B while Vice Chairman shall be appointed by Party A.  The Chairman, Vice Chairman, and the Director shall be appointed for a term of three (3) years and may serve consecutive terms if re-appointed by the nominating Party.

 

	
Article 20  

	
The Board shall be the highest authority of the Company and entitled to decide all material matters of the Company.  The following material matters shall be approved unanimously by the Board:

 

	
1.  

	
Amendment of the Articles of Association of the Company;

 

	
2.  

	
Extension, termination or dissolution of the Company;

 

	
3.  

	
Merging with other economic organization;

 

	
4.  

	
Increase or transfer of the Company’s registered capital.

 

Other matters shall be approved by the Board with a simple majority votes.

 

  

5

  

 

	
Article 21  

	
The Chairman shall be the legal representative of the Company.  Where the Chairman fails to fulfill his obligations for any reason, he/she shall temporarily authorize the Vice Chairman or other Director to represent him/her.  Where the Chairman does not make an express authorization, the Vice Chairman shall represent the Chairman.

 

	
Article 22  

	
The Board shall meet at least once a year and the Chairman shall convene and preside over the Board Meeting.  The Board meetings shall normally be held at the legal address of the Company.  The Chairman may convene an interim Board meeting under the request proposed by no less than one-third of the Directors.  The minutes of the meeting shall be placed on file until expiration of the term of the Company.

 

	
Article 23  

	
Two-thirds of all of the Directors shall constitute a quorum for the annual Board Meeting and the interim Board meeting.

 

	
Article 24  

	
Each Party has the obligation to ensure that the Directors appointed by it are present at the annual Board meeting and the interim Board meeting.

 

Where a Director is unable to attend a Board meeting for any reason, he/she must appoint a proxy in writing to attend the meeting on his/her behalf.

 

	
Article 25  

	
Where any Director who is appointed by a Party or Parties fails to attend the Board meeting personally or by proxy, and the Board fails to reach a decision on major issues of the Company stipulated by laws, regulations and this Contract within two (2) days of the Board meeting due to such absence, the other Party (the notifying Party) shall again notify in writing the absent Director and the appointing Party or Parties (the receiving Party) to its legal address (domicile) to urge such Director to attend the Board meeting on the specified time.

 

	
Article 26  

	
The abovementioned notice shall be sent by double-registered mail at least sixty (60) days prior to the date of the meeting and indicated that the receiving Party shall reply in writing within forty-five (45) days following the date on which the notice was sent with respect to the attendance of the Board meeting.  Where the receiving Party fails reply within specified time, it shall be deemed to forfeiture of his/her right.  Upon receiving of the return receipt of the double-registered mail by the notifying Party, the Directors appointed by the notifying Party can convene a special Board meeting.  This special Board meeting may make valid decision on major issues by unanimous approval by all the Directors present at the special Board meeting, even if the quorum has not been satisfied.

 

	
Article 27  

	
The Chairman or the Vice Chairman or other Directors authorized by the Chairman shall have the right to supervise and examine the implementation of the Board resolutions by the General Manager, provided, however, no one has the right to interfere the General Manager’s management in the daily business.

 

CHAPTER 9  SUPERVISORS

 

	
Article 28  

	
The Company has one (1) supervisor who will be appointed by both Parties.

 

Any Director, manager or financial principal shall not concurrently serve as the supervisor.

 

	
Article 29  

	
The supervisor shall be appointed for a term of three (3) years and may serve consecutive terms if re-appointed.

 

  

6

  

 

	
Article 30  

	
The board of Supervisors/ supervisor shall have the following duties:

 

	
1.  

	
Examine the financial record of the Company;

 

	
2.  

	
Supervise the behavior of the Directors and managers in connection with their performance of duties of the Company violating the laws, regulations or Articles of Association of the Company;

 

	
3.  

	
Demand any Director or manager to correct his/her behaviors impairing the benefit of the Company;

 

	
4.  

	
Propose to convene interim shareholders meeting;

 

	
5.  

	
Other duties stipulated by the Articles of Association.

 

The Supervisor shall attend the Board Meeting as a non-voting attendant.

 

CHAPTER 10  MANAGEMENT ORGANIZATION

 

	
Article 31  

	
The Company shall establish a management organization which shall be responsible the day-to-day operation and management of the Company.  The General Manager of the management organization shall be nominated by Party A while the deputy General Manager shall be nominated by Party B. Both the General Manager and the deputy General Manager shall be appointed by the Board.  The term of office shall be three (3) years.

 

	
Article 32  

	
The duty of the General Manager is to execute the decisions resolved by the Board, organize daily management and operation of the Company.  The deputy General Manager shall assist the General Manager in performing his/her duties.

 

There will be eight departments in the management organization, which consists of manufacturing department, technology department, sales department, financial department, logistic department, administrative department, procurement department and engineering department.  Each department has one (1) department manager who shall be in charge of the operation of such department, complete tasks assigned by, and be accountable to, the General Manager or the deputy General Manager.

 

	
Article 33  

	
Where the General Manager or the deputy General Manager engaged in malpractice or gross negligence in his/her duty, he/she will be dismissed by the Board resolution from time to time.  The nominating Party shall re-nominate a proper person to be approved by the Board to take office.

 

	
Article 34  

	
The General Manager and the deputy General Manager shall only represent the Company and shall not represent either Party of the Company.

 

  

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CHAPTER 11  PROCUREMENT OF EQUIPMENT AND MATERIALS

 

	
Article 35  

	
The Company shall procure the raw materials, equipment and auxiliary components, transportation tools and office appliances necessary for the operations of the Company preferentially from domestic market under equal conditions.

 

	
Article 36  

	
Where there are needs for the Company to procure equipment, the Parties shall jointly conduct inspection, selection, inquiry and choose the quality products with preferable price.  The Parties shall organize a business negotiation team constituted by representatives from the Parties to negotiate with the manufacturer of the equipment.  After that, the Company will procure the equipment directly or entrust Party B to procure the equipment from oversea market (Procurement agreements shall be executed separately.).  The procured equipment shall be brand new and shall be among the most advanced of the same kind throughout the world.  The mechanic equipments shall be submitted to the commodity inspection authority of the PRC for inspection pursuant to the Regulations on Commodity Inspection of PRC.

 

CHAPTER 12  LABOR MANAGEMENT

 

	
Article 37  

	
The Company shall adopt the labor contract system on recruitment.  Plans relating to matters on the recruitment, dismissal and termination of labor contract, production and working tasks, salary, rewards and discipline, working time and vocations, labor insurance and welfares, labor protection, and employment disciplines shall be discussed and formulated by the Board and shall be stipulated in the collective labor contract between the Company and the union of the Company, or in the labor contract between the Company and the employees in accordance with the Labor Law of People’s Republic of China and other relevant laws and regulations.  The labor contract shall be filed with local labor administration authority for authentication after execution.

 

	
Article 38  

	
The recruitment, salary, social security, welfare and reimbursement of travel expense for the senior management shall be discussed and deiced on by the Board in accordance with relevant regulations of PRC.

 

CHAPTER 13  TAX; FINANCE; AUDIT

 

	
Article 39  

	
The Company shall pay various taxes in accordance with the relevant Laws and regulations of PRC.

 

	
Article 40  

	
The Company shall be responsible to withhold and collect the individual income tax of the employees of the Company in accordance with the Individual income Tax Law of People’s Republic of China.

 

	
Article 41  

	
The Company shall withdraw the reserve fund, the enterprise expansion fund and bonus and welfare fund of the Company in accordance with the Equity Joint Venture Law.  The amount of the reserve fund withdrawn shall not be less than ten percent (10%) of the after-tax profit in any one year.  The Board shall discuss and decide on the percentage of the enterprise expansion fund and bonus and welfare fund of the Company according to the business of the Company.

 

	
Article 42  

	
The fiscal year of the Company shall start on January 1 of each calendar year and end on December 31 of the same year.  All accounting documents, vouches, reports and books of the Company shall be prepared in Chinese.  The Company shall use Renminbi as the base bookkeeping currency in its financial statements.

 

	
Article 43  

	
The financial auditing of the Company shall be conducted and examined by certified public accountant registered in China retained by the Company and the results shall be reported to the Board.

 

Where a Party finds it necessary to hire certified public accountant registered in other countries to audit the annual finance of the Company, the other Party shall consent, provided that all the expenses incurred therefrom shall be undertaken by the hiring Party.

 

	
Article 44  

	
Within three (3) months following the beginning of each fiscal year, the Company shall under organization of the General Manager prepare the balance sheet, statement of loss and gain and profit distribution plan which shall be submitted to the Board meeting for approval.

 

  

8

  

 

CHAPTER 14  TERM OF JOINT VENTURE

 

	
Article 45  

	
The term of the Company will expire on February 26, 2059 (“Term”).

 

If one Party proposes to extend the Term, and such proposition is approved by the Board, such extension shall be filed with the original Approving Authority for approval at least six (6) months before the expiry of the Term.

 

Within thirty (30) days after the approval of extension of the Term, such extension shall be filed with original Registration Authority for registration.

 

CHAPTER 15  DISPOSAL OF ASSETS UPON EXPIRATION

 

	
Article 46  

	
Upon the expiration or early termination of the Company, the Company shall conduct liquidation in accordance with the laws.  The assets after liquidation shall be distributed in proportion to the respective shares in the registered capital of the Parties to the Company.

 

CHAPTER 16  INSURANCE

 

	
Article 47  

	
Any insurance of the Company shall be purchased from domestic insurance companies.  The Board shall discuss and determine the type of insurance, the value of insurance, the currency of insurance and the term of insurance in accordance with regulations relating to insurance of the PRC.

 

CHAPTER 17  AMENDMENT; MODIFICATION; TERMINATION

 

	
Article 48  

	
Any amendment to the Contract shall become effective upon written approval of the Parties and approval by the original Approval Authority.

 

Any amendment to the annex of this Contract shall become effective upon the Board’s unanimous approval and the original Approval Authority.

 

	
Article 49  

	
Where the performance of the Contract becomes impossible due to an event of Force Majeure, or where the Company is unable to continue its business due to losses in consecutive years, the Board may unanimously approve to terminate or cancel the Contact in advance, which shall be approved by the original Approval Authority.

 

	
Article 50  

	
Where a Party fails to perform the obligations under the Contract or the Articles of Association, or materially breaches the Contract or the Articles of Association, due to which the Company becomes unable to operate or achieve its purpose hereunder, the breaching Party shall be deemed as unilaterally terminating the Contract.  In addition to the right to seek compensation from the breaching Party, the complying Party shall have the right to apply to the original Approval Authority to terminate the Contract according to the provisions hereunder.  Where the Parties agree to continue the operation, the breaching Party shall compensate the economic losses of the Company in the first place.

 

  

9

  

 

CHAPTER 18  LIABILITY FOR BREACH OF CONTRACT

 

	
Article 51  

	
Where the Contract and its annex cannot be performed in part or in whole due to the fault of one Party, such Party shall be liable for breach of contract.  Where the Contract and its annex cannot be performed due to the fault of both Parties, each Party shall respectively be liable for its own breach of contract according to actual situation.

 

CHAPTER 19  EVENT OF FORCE MAJEURE

 

	
Article 52  

	
Where an event of force majeure, such as earthquake, typhoon, fire, flood, war and other event that is unforeseeable and the results of which is unpreventable and unavoidable, directly affect the performance of the Contract or result in a failure to perform the Contract under provided conditions, the Party affected by such event shall immediately notice such event to the other Party by telegram, and shall within fifteen (15) days provide valid proof of the reason with respect to impossibility of performance , partial performance or the need to delay the performance, which shall be issued by the notary public located at the place where such event occurs.  The Parties shall discuss and determine whether to terminate the Contract, to partially waive the obligations under the Contract, or to delay the performance of the Contract to the extent that the performance is affected.

 

CHAPTER 20  GOVERNING LAWS

 

	
Article 53  

	
The execution, performance, modification, termination and disputes resolution hereunder shall be governed by laws of People’s Republic of China.

 

CHAPTER 21  SETTLEMENT OF DISPUTES

 

	
Article 54  

	
Any dispute arising out of or in connection with this Contract shall be resolved through friendly negotiation by the Parties.

 

	
Article 55  

	
The Parties agree that, during the settlement of disputes, they shall continue to perform their respective obligations under this Contract, except for those disputed matters.

 

CHAPTER 22  LANGUAGE

 

	
Article 56  

	
This Contract is written in Chinese.

 

CHAPTER 23  EFFECTIVENESS; MISCELLANEOUS

 

	
Article 57  

	
The Articles of Association, Capital Contribution Agreement, Products Buy-back Agreement, Lease Contract, Equipment Importing Contract shall constitute part of this Contract.

 

	
Article 58  

	
This Contract, including its annex, shall become effective upon approval by Approval Authority entrusted by Ministry of Commerce of the PRC.

 

	
Article 59  

	
Notices given by one Party to the other Party can be made by telephone, telegram or telex, and shall be made in writing from time to time in the event that the contents containing the rights and obligations of the Parties.  All notices shall be served to the legal address of the other Party.  In case that the legal address of either Party is changed, the Party shall notice the other Party within thirty (30) days before such change, or otherwise the Party whose legal address is changed shall be liable for any liabilities result therefrom.

 

  

10

  

 

	
Article 60  

	
This Contract is executed by the Parties in Rugao City, China on March 10, 2010.

 

 

Party A:

 

Legal Representative: Wang Jianjun

 

(Signature and seals)

 

Party B:

 

Legal Representative: Wang Yong

 

 (Signature and seals)

 

March10, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11ex102.htm

Exhibit 10.2

 

ARTICLES OF ASSOCIATION

OF

SINO- FOREIGN EQUITY JOINT VENTURE

 

WORLDWIDE ENERGY AND MANUFACTURING (NANTONG) CO., LTD.

 

 

CHAPTER 1. GENERAL PROVISIONS

 

	
Article 1.  

	
These Articles of Association are formulated in accordance with the Company Law of the People’s Republic of China, Sino-Foreign Equity Joint Ventures Law of the People's Republic of China, other relevant laws and regulations of the People’s Republic of China, and the Joint Venture Contract (the “Contract”) entered into by Rugao Brother Solar Energy and Technology, Ltd. (“Party A”) and Worldwide Energy and Manufacturing USA, Inc. (“Party B”) on March 10, 2010 for the joint investment and establishment of Worldwide Energy and Manufacturing (Nantong) Co., Ltd. (the “Company”).

 

	
Article 2.  

	
Name and Address of the Company

 

	
1.  

	
Name of the Company

 

The name of the Company is “南通美能得太阳能电力科技有限公司” in Chinese and “Worldwide Energy and Manufacturing (Nantong) Co., Ltd.” in English.

 

	
2.  

	
Address of the Company

 

The legal address of the Company is Qifeng Road, Rucheng Town, Rugao City, Jiangsu Province.

 

	
Article 3.  

	
Name and Legal Address of the Parties to the Company

 

	
1.  

	
Party A: Rugao Brother Solar Energy and Technology, Ltd.

 

	
Legal Representative:

	
Wang Jianjun

	
Position:

	
Executive Director

	
Nationality:

	
Chinese

	
Legal Address:

	
Qifeng Road, Rucheng Town, Rugao City, Jiangsu Province

 

	
2.  

	
Party B: Worldwide Energy and Manufacturing USA, Inc.

 

	
Legal Representative:

	
Wang Yong

	
Position:

	
Chairman of the Board

	
Nationality:

	
United States of America

	
Telephone:

	
+1-650-794-9888

	
Legal Address:

	
408 North Canal Street, Units A and B. South San Francisco. CA94080. USA

 

  

1

  

 

	
Article 4.  

	
Type of the Company: Limited Liability Company (Sino-foreign Equity Joint Venture)

 

	
Article 5.  

	
The Company is a PRC legal person and shall be governed and protected under the laws of China.  All the activities of the Company shall comply with the laws and regulations of China.

 

CHAPTER 2.  PURPOSE AND BUSINESS SCOPE

 

	
Article 6.  

	
The purpose of the Company is to apply advanced domestic and overseas technology; to manufacture and market various types of solar energy product; so as to enable both Party A and Party B to achieve satisfactory economic benefits.

 

 

	
Article 7.  

	
The business scope of the Company is to carry out research, manufacture, process activities with respect to solar energy photovoltaic modules and its component parts, to sell the products manufactured by its own and to engage in the import and export business with respect to such products (distribution of imported commodities is excluded).

 

 

	
Article 8.  

	
The production scale in the early stage of the Company is fifty (50) megawatts solar energy photovoltaic component parts per year.

 

 

	
Article 9.  

	
The Company will directly export up to ninety-five (95) percent of its products and the rest will be sold in domestic market.

 

CHAPTER 3. TOTAL INVESTMENT AND REGISTERED CAPITAL

 

	
Article 10.  

	
The total investment of the Company shall be US$ 25 Million (US$ 25,000,000.00) and the registered capital of the Company shall be US$ 10 Million (US$ 10,000,000.00).

 

  

2

  

 

	
Article 11.  

	
The contributions to the registered capital of the Parties are as follows:

 

	
1.  

	
Party A’s contribution to the registered capital of the Company shall be US$ 4.9 Million (US$ 4,900,000.00), representing forty-nine percent (49%) of the total registered capital of the Company, among which, US$ 0.01 Million (US$ 10,000.00) will be made in the form of Renminbi and US$ 4.89 Million (US$ 4,890,000.00) will be made in cash in the form of United States Dollars.

 

	
2.  

	
Party B’s contribution to the registered capital of the Company shall be US$ 5.1 Million (US$ 5,100,000.00 representing fifty-one percent (51%) of the total registered capital of the Company.

 

The exchange rate of the Renminbi and the United States Dollars shall be the BasicRate published by the People’s Bank of China on the date of receipt of such contribution.

 

The contribution to the registered capital of the Company made by the parties in cash or in foreign currency shall be wired into the Company’s account and used in a unified manner.

 

If one of the parties to the Company contributes to the registered capital in kind, its price and quality of shall be acknowledged by the other Party to the Company.

 

	
Article 12.  

	
Each Party’s contribution to the registered capital of the Company has been fully paid.

 

	
Article 13.  

	
After the Parties have made their contributions to the registered capital of the Company, a certified public accountant retained by the Company shall verify such contribution and issue a capital verification report, according to which, the Company shall issue an investment certificate to the parties to the Company.

 

	
Article 14.  

	
During the term of the Company, the Company shall not reduce its registered capital.  Upon approval by the Approval Authority, the Company may reduce its registered capital to the extent necessary to reflect the change in the total amount of investment and the production scale.

 

	
Article 15.  

	
Any transfer by a Party of all or any part of its contribution in the Company shall be consented by the other Party.  Upon one Party’s transfer, the other Party shall have a right of first refusal regarding such transfer under the same condition.

 

	
Article 16.  

	
Any increase or transfer in the registered capital of the Company shall be approved by the Board unanimously.  The Company shall submit an application to the original Approval Authority and register such change with the original Registration Authority within thirty (30) days after the approval.

 

  

3

  

 

CHAPTER 4. THE BOARD OF DIRECTORS

 

	
Article 17.  

	
The Company shall establish a Board of Directors.

 

	
Article 18.  

	
The Board shall decide all the major issues of the Company, and its major authorities are as follows:

 

	
1.  

	
Decide the appointment of the senior staffs such as the General Manager and the Deputy General Manager;

 

	
2.  

	
Decide and approve the important reports made by the General Manager (such as the production plan, annual business report, financing and loans);

 

	
3.  

	
Approve the annual financial statement, balance and budgets, and annual profit distribution plan;

 

	
4.  

	
Approve the important internal rules and regulations of the Company;

 

	
5.  

	
Decide the establishment of the branch offices;

 

	
6.  

	
Amend these Articles of Association;

 

	
7.  

	
Discuss the extension, suspension, and dissolution or merger with other economic entities of the Company;

 

	
8.  

	
Discuss the increase or assignment of the registered capital of the Company;

 

	
9.  

	
In charge of the liquidation of the Company upon termination or expiration of the Company; and

 

	
10.  

	
Other major issues that shall be decided by the Board.

 

	
Article 19.  

	
The Board shall consist of three (3) Directors, one shall be appointed by Party A and two shall be appointed by Party B.  The term of office of the Directors shall be three (3) years.  The Board shall have one (1) Chairman whom shall be appointed by Party B, and the Board shall have one (1) Vice Chairman whom shall be appointed by Party A.  The Chairman of the Board shall be the legal representative of the Company.  The term of office of the Chairman and the Vice Chairman shall be three (3) years and the Chairman and the Vice Chairman may serve consecutive terms upon expiration of the term of office if reappointed by the appointing party.

 

  

4

  

 

The term of office of the Director shall be three (3) years and directors shall be appointed by the investors.  The Directors may serve consecutive terms upon expiration of the term of office if reappointed by the appointing party.  Where the number of the Board member is lower than the statutory required number due to that no timely appointment has been made upon expiration of the term of office, or a Director resigns during his/her term of office, before the newly appointed Director takes office, the original Director shall perform his/her obligations as a Director according to the provisions of the laws, regulations and this Articles of Association.

 

	
Article 20.  

	
Meetings of the Board shall be held at least once a year.  Board meetings shall be convened and presided over by the Chairman.  If the Chairman cannot or fails to fulfill his/her obligations, the Board meetings shall be convened and presided over by the Vice Chairman.  If the Vice Chairman cannot or fails to fulfill his/her obligations, the Board meeting shall be convened and presided over by a Director jointly elected by more than half of the Directors.

 

If a director is unable to attend a meeting of the Board, the director may appoint a proxy in writing to attend such meeting.  The absence of a Director from a meeting of the Board without appointment of a proxy shall be considered as the forfeiture of such Director's right.

 

	
Article 21.  

	
Each director shall have only one vote in the resolution of the Board meeting.  The quorum for all meetings of the Board shall be more than two thirds of the all the Directors.  No resolution is validly passed if such quorum is not present in the Board meeting.

 

The Board shall prepare meeting minutes to record the resolutions made with respect to the issues discussed at the meeting of the Board.  All Directors present in the Board meeting shall sign on the meeting minutes.

 

	
Article 22.  

	
The following matters shall be approved unanimously by the Board:

 

	
1.  

	
the amendment to these Articles of Association of the Company;

 

	
2.  

	
the extension, termination, and dissolution of the Company;

 

	
3.  

	
the increase or assignment of the registered capital of the Company;

 

	
4.  

	
the Company’s merger with other economic entities.

 

Decisions with respect to all other matters shall be adopted if they receive the affirmative vote of a simple majority.

 

	
Article 23.  

	
The Chairman, Vice Chairman or other Directors upon authorization by the Chairman shall have the right to supervise and examine the implementation of the Board resolutions by the General Manager, provided, however, no one has the right to interfere the General Manager’s management in the daily business.

 

  

5

  

 

CHAPTER 5.  SUPERVISORS

 

	
Article 24.  

	
The Company shall have one Supervisor instead of a board of supervisors.  The Supervisor shall be jointly appointed or changed by the Parties.  The term of office of the Supervisor shall be three (3) years.  The Supervisor may serve for consecutive term upon expiration of his/her term of office if re-appointed.  Where no timely appointment is made upon expiration of the term of office of the Supervisor, the original Supervisor shall continue to perform his/her obligation as a Supervisor before the newly appointed Supervisor takes office according to the provisions of the laws, regulations and these Articles of Association.

 

	
Article 25.  

	
The Supervisor shall exercise the following functions and powers:

 

	
1.  

	
To examine the Company’s financial affairs;

 

	
2.  

	
To supervise the acts of the Directors and the senior management in respect of their performance of duties for the Company, and make dismissal proposals with respect to Directors or senior management who violate the laws, regulations or the provisions of these Articles of Association.

 

	
3.  

	
To demand Directors or senior management to rectify when their acts damage the interests of the Company;

 

	
4.  

	
To make motions to the Board;

 

	
5.  

	
To exercise other functions and powers provided by these Articles of Association.

 

	
Article 26.  

	
The Directors and senior management shall not concurrently server as Supervisor.

 

CHAPTER 6.  BUSINESS MANAGEMENT INSTITUTION

 

	
Article 27.  

	
The Company’s business management institution will include eight departments such as the sales department, purchase department, manufacturing department, technology department, finance department, executive department, logistic department, and engineering department.

 

  

6

  

 

	
Article 28.  

	
The Company shall have one General Manager recommended by Party A.  The Company shall have one Deputy General Manager recommended by Party B.  The General Manager and the Deputy General Manager shall both be appointed by the Board.  The manager shall be responsible for the Board, and has the following functions and powers:

 

	
1.  

	
To take charge of the production, operation and management of the Company and organize the implementation of the Board resolutions;

 

	
2.  

	
To organize the implementation of the Company’s annual business plan and investment plan;

 

	
3.  

	
To draft plans on the establishment of the Company’s internal management organization;

 

	
4.  

	
To draft the Company’s basic management regulations;

 

	
5.  

	
To formulate the Company’s specific rules and regulations;

 

	
6.  

	
To propose to hire or dismiss the Company’s deputy manager(s) and the person in charge of finance;

 

	
7.  

	
To decide on the hiring or dismissal of the management personnel other than those who shall be decided by the Board; and

 

	
8.  

	
Other powers conferred by the Board.

 

	
Article 29.  

	
The Deputy General Manager shall assist in the works of the General Manager.  Where the General Manager is absent, the Deputy General Manager may exercise the power and function of the General Manager according to the authorization made by the General Manager.

 

	
Article 30.  

	
Each of the General Manager and the Deputy General Manager shall serve a term of three (3) years and may serve for consecutive terms upon further recommendation and appointment made by the Board.

 

	
Article 31.  

	
The Chairman may serve concurrently as the General Manager, Deputy General Manager or other senior management of the Company upon appointment made by the investors.

 

	
Article 32.  

	
The General Manager and the Deputy General Manager shall not concurrently occupy an operational position in any other economic organization and shall not participate in the competition against the Company carried out by other economic organization.

 

  

7

  

 

	
Article 33.  

	
The General Manager and the Deputy General Manager shall only work on behalf of the Company and shall not represent either Party to the Equity Joint Venture.

 

	
Article 34.  

	
The resignation of the General Manager, Deputy General Manager and other senior management shall be made to the Board in writing sixty (60) days in advance.

 

Where the abovementioned personnel engaged in malpractice or gross negligence, they will be dismissed at any time upon the resolution of the Board.  Where such personnel breach the criminal law, they shall be accountable for their criminal responsibilities according to the laws.

 

CHAPTER 7.  FINANCIAL AFFAIRS AND ACCOUNTING

 

	
Article 35.  

	
The accounting of the Company shall comply with the Accounting Law of the People's Republic of China and other relevant laws and regulations.

 

	
Article 36.  

	
The accounting year of the Company shall be calendar year starting from January 1 of each year to December 31 of the same year.

 

	
Article 37.  

	
All accounting records, vouchers, books and statements of the Company shall be made in the Chinese.

 

	
Article 38.  

	
The standard bookkeeping currency of the Company shall be Renminbi.  The exchange method of Renminbi and other currencies shall apply the relevant financial laws and regulations of the PRC and the exchange rate shall be the BasicRate published by the People’s Bank of China on the date of actual occurrence.

 

	
Article 39.  

	
The Company shall open a foreign currency bank account with such bank approved by the State Administration of Foreign Exchange.

 

	
Article 40.  

	
The Company shall adopt the debit and credit double entry bookkeeping method and the accrual system to keep accounts.

 

	
Article 41.  

	
Annually, the financial department of the Company shall prepare the balance sheet and profit and loss statement for the last financial year within three (3) months after the end of the previous financial year, which shall be approved and signed by the General Manager and then submitted to the Board meeting for further approval.

 

	
Article 42.  

	
Each Party shall have the right to separately retain a certified public accountant at its own expense to inspect the Company’s accounts.  The Company shall provide convenience for such inspections.

 

	
Article 43.  

	
The depreciation term of the fixed assets shall be decided by the Board and accelerated depreciation shall be submitted to relevant authority for approval in accordance with the provisions of the Enterprise Income Tax Law of the People’s Republic of China and its implementation rules.

 

	
Article 44.  

	
All foreign exchange related matters of the Company shall be handled according to the Regulations of Foreign Exchange Administration of the People’s Republic of China and relevant regulations.

 

  

8

  

 

CHAPTER 8.  PROFITS DISTRIBUTION

 

	
Article 45.  

	
The Company shall withdraw the reserve fund, the enterprise expansion fund and the employee bonus and welfare fund from the after tax profit, among which, the reserve fund withdrawn each year shall not be less than ten percent (10%) of the after tax profit.  The percentage of the enterprise expansion fund and the employee bonus and welfare fund shall be discussed and determined by the Board according to the business of the Company.

 

	
Article 46.  

	
The Company shall distribute the after tax profits of the Company deducting each fund withdrawn in proportion to the respective shares in the registered capital of the Parties to the Company.

 

	
Article 47.  

	
The Company shall distribute its profits once every year.  The profit distribution plan and the amount of profit to be distributed to each Party shall be published within three (3) months following each accounting year.

 

	
Article 48.  

	
The Company may not distribute any profits unless the losses of the previous year have been made up.  Undistributed profits from the previous year may be distributed together with the profit of the current year.

 

CHAPTER 9.  EMPLOYEE

 

	
Article 49.  

	
The Company shall adopt labor contract system on recruitment.  Matters relating to the recruitment, dismissal, termination of the employment contract, wages, welfare, labor insurance, labor protection, labor discipline, and employment disputes shall be handled in accordance with the Labor Law of the People’s Republic of China and other related laws and regulations.

 

	
Article 50.  

	
The Company shall give priority consideration for employing personnel who are Party A’s original employee and recommend by Party A based on merits.  Where such personnel cannot satisfy the need of the Company, the Company may recruit from the public based on merits after the Company formulates an employment plan according to its business need and files it with the local labor administration authority for record.  Such recruited personnel shall be placed to his/her position after being trained and passed examination.

 

	
Article 51.  

	
The Company shall have the right to discipline employees who have violated the rules, regulations and labor discipline of the Company according to the situation of his/her violation.

 

Such decision in connection with the discipline of employees shall be filed with the local labor authority for record.

 

	
Article 52.  

	
The welfare and benefits of the employees of the Company shall be formulated by the Board based on the actual situation of the Company according to the relevant rules of China, and set forth specifically in the labor contract, to ensure the employees’ lawful benefits.

 

With the development of the Company’s production, the improvement of the employees’ professional ability and the technology, the Company shall increase the remuneration paid to the employees accordingly.

 

  

9

  

 

	
Article 53.  

	
Matters with respect to the employees’ placement, bonus, labor protection, and labor insurance shall be separately set forth in various regulations of the Company to ensure that the employees work under the normal working conditions.

 

CHAPTER 10.  TRADE UNION

 

	
Article 54.  

	
The employees of the Company shall have the right to establish a trade union organization and carry out trade union activities in accordance with the Trade Union Law of the People's Republic of China.

 

	
Article 55.  

	
The trade union of the Company shall be the representative of the employees.  Its responsibilities are to protect the democratic rights and material benefits of the employees in accordance with law; to organize the employees to study politics, professional knowledge, science, and technology, to carry out cultural, entertainment and sports activities; to educate the employees to observe labor discipline and to strive to fulfill the various manufacture tasks of the Company.

 

	
Article 56.  

	
The trade union of the Company shall enter into collective labor contract with the Company on behalf of the employees, guide the employees to enter into individual labor contract with the Company, and supervise the implementation of the contracts.

 

	
Article 57.  

	
The person in charge of the trade union of the Company shall have the right to make the opinion and requirement of the employees known by the Board of the Company.

 

	
Article 58.  

	
The trade union of the Company may participate in the mediation of the disputes between the employees and the Company.

 

	
Article 59.  

	
The Company shall pay an amount equal to two percent (2%) of the actual wages received by the Chinese employees of the Company into the Company’s trade union fund for such trade union’s use in accordance with the Administration Rules regarding the Trade Union Fund formulated by the All China Federation of Trade Unions.

 

CHAPTER 11.  DURATION, TERMINATION AND LIQUIDATION

 

	
Article 60.  

	
The term of the Company will expire on February 26, 2059.

 

	
Article 61.  

	
If both Parties agree to extend the term of operation, upon resolution adopted by the Board, an application in writing for extension shall be submitted to the original Approval Authority within six (6) months prior to the expiration of the term.  The extension shall be approved by the original Approval Authority and registered with the original Registration Authority within thirty (30) days following the approval.

 

	
Article 62.  

	
Upon resolution adopted by the Board, the Parties may terminate the equity joint venture prior to its expiration if both Parties believe that termination will serve the best interest of the Parties.

 

The early termination of the Company shall be approved in the Board meeting at which the entire Board member present and shall be submitted to the original Approval Authority for approval.

 

  

10

  

 

	
Article 63.  

	
Where a Party fails to perform its obligations under the Joint Venture Contract, and these Articles of Association or materially breaches the Joint Venture Contract or these Articles of Association, making it impossible for the Company to operate, in addition to the right to seek compensation from the breaching Party, the complying Party shall have the right to submit the early termination application to the original Approval Authority for approval according to the Joint Venture Contract.

 

	
Article 64.  

	
If, upon the scheduled expiration of the term of the Company or upon any earlier proposed dissolution of the Company, the Board shall propose a liquidation procedure and establish a Liquidation Committee to liquidate the assets of the Company in accordance with the laws

 

	
Article 65.  

	
The task of the Liquidation Committee is to carry out a full examination of the Company's assets, rights and liabilities, compile a statement of assets and liabilities and a detailed list of assets, prepare a plan for liquidation, submit the same to the Board for approval, and implement the same upon examination and approval by the Board.  Such plan shall be filed with principal financial authority for record.

 

	
Article 66.  

	
During the period of liquidation, the Liquidation Committee shall represent the Company to institute or defend against in any legal proceeding.

 

	
Article 67.  

	
Liquidation expenses and the remunerations of the members of the Liquidation Committee shall be paid in priority from the liquidation income of the Company’s remaining assets.

 

	
Article 68.  

	
The payment priority of liquidated debts is as follows:

 

	
1.  

	
The wages, the insurance premiums and welfare of the employees to be paid by the Company;

 

	
2.  

	
The state tax arrears and other payments to be made by the Company;

 

	
3.  

	
Unpaid secured debts of the Company;

 

	
4.  

	
Other unpaid debts of the Company

 

Where the liquidation assets are insufficient to make all the payments under the same order of priority, such payments shall be made on a pro-rata basis.

 

  

11

  

 

	
Article 69.  

	
After the liquidation, such amount of the net assets or the remaining assets of the Company exceeding the aggregate amount of the registered capital, reserve fund, enterprise expansion fund, capital reserve and the undistributed profits shall be deemed as profits, which shall be subject to income tax.

 

	
Article 70.  

	
After the liquidation is completed, the Company shall submit a report to the original Approval Authority and register the cancellation with the original Registration Authority, to whom the Company shall return and cancel its business license.  The Company shall also make a public announcement of the Company’s dissolution.

 

	
Article 71.  

	
After the termination of the Company, its various accounting vouchers, books and documents shall be kept by Party A.

 

CHAPTER 12.  INTERNAL RULES AND REGULATIONS

 

	
Article 72.  

	
The rules and regulations of the Company formulated by the Board include:

 

	
1.  

	
Business and management code, including the responsibilities of all the departments to which they belong;

 

	
2.  

	
Employee manual;

 

	
3.  

	
Labor remuneration code;

 

	
4.  

	
Employee attendance management, promotion, reward and discipline code;

 

	
5.  

	
Employee welfare code;

 

	
6.  

	
Financial Accounting code;

 

	
7.  

	
Liquidation procedure upon dissolution of the Company;

 

	
8.  

	
Other necessary rules and regulations.

 

  

12

  

 

CHAPTER 13.  MISCELLANEOUS

 

	
Article 73.  

	
These Articles of Association have been executed in six (6) copies in Chinese.  These Articles of Association and any amendments to these Articles of Association shall become effective upon execution by the investor and approval by the Approval Authority.

 

	
Article 74.  

	
As far as the statutory required registration items of the Company are concerned, such contents approved and examined by the Registration Authority shall prevail.

 

	
Article 75.  

	
Any amendments to these Articles of Association shall be approved by the Board unanimously and submitted to the original Approval Authority for approval.

 

Any amendments to these Articles of Association involving a change of the statutory required registration items shall be registered with the original Registration Authority within statutory required time to reflect such change and the amended Articles of Association shall also be submitted to the original Registration Authority.

 

Any amendments to these Articles of Association which do not involve a change of the statutory required registration items shall be filed with the Registration Authority for record.

 

	
Article 76.  

	
Matters not covered in these Articles of Association shall be dealt with in accordance with the Company Law of the People’s Republic of China the Sino-Foreign Equity Joint Ventures Law of the People's Republic of China, and other state laws and regulations.  Should any provisions of these Articles of Association conflict with the state laws and regulations, the state laws and regulations shall prevail.

 

Party A: Rugao Brother Solar Energy and Technology, Ltd.

 

Legal Representative: Wang Jianjun

 

(signature and company seal)

 

Party B: Worldwide Energy and Manufacturing USA, Inc.

 

Legal Representative: Wang Yong

 

(signature and company seal)

 

Worldwide Energy and Manufacturing (Nantong) Co., Ltd

 

Legal Representative: Wang Yong

 

(signature and company seal)

 

Date: March 10, 2010

 

 

 

 

13

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