Document:

kl06024_ex10-1.htm

    
      

    

     

    Exhibit 10.1

    
 

    Equity
Transfer Agreement of Jingrong Industrial Development Co., Ltd. in Rongjiang
County of Guizhou Province (hereinafter referred to “Jingrong”)

    

    Transfer:
(a total of five people, hereinafter referred to “Shareholders”)

    

    Wu
Huimin: Sex: M; Birthday: April 22, 1953; Nationality: Han, Address: Huhou
Village, HuangHu Town, Jingning She Autonomous Region, Zhejiang Province. SSN:
332529530422721

    

    Liu
Jian-Hua, Sex: F; Birthday: October 4, 1961; Nationality: Han; Address:
Yekengxia Village, Dadi Town, Jingning She Autonomous Region, Zhejiang Province.
SSN: 332529611004601

    

    Xu
Jin-Gen, Sex: F; Birthday: March 29, 1963; Nationality: Han; Address: Chengxi
New Villag, Jingning She Autonomous Region, Zhejiang Province; SSN:
332529630329003

    

    Ye
Huajie: Sex: M, Birthday: November 9, 1971; Nationality: Han, Address: Room
B5301, Shiyinshan District, Jingning She Autonomous Region, Zhejiang Province;
SSN: 332529197111091137

    

    Mei
Xiandong, Sex: F, Birthday: June 13, 1953; Nationality: Han; Address: 8 Jianshe
Road, Jingning She Autonomous Region; Zhejiang Province. SSN:
332529530613001

    

    Transferee:
Hunan Zhaoheng Hydropower Co., Ltd. (hereinafter referred to
“Zhaoheng”).

    

    Address:
Dianzhan Road, Shimen County, Hunan Province. Legal representative: Zhu
Hong,

    Title:
Chairman.

    

    On
December 5, 2001, Rongjiang County Government of Guizhou Province, Jingrong
(which hasn’t been officially registered at the time of the agreement) and the
representatives of the Shareholders including Wu Huimin, Liu Jian-Hua, Xu
Jin-Gen, and Ye Huajie signed the "Transfer of Rongjiang County Yongfu
Hydropower Station Operating Contract." (hereinafter referred to “Transfer
Agreement”) In the agreement, Rongjiang County Government of Guizhou Province
transferred unfinished Yongfu Hydropower Station to Jingrong (with Wu Huimin,
Liu Jian-Hua, Xu Jin-Gen, Ye Huajie, etc. as shareholders) for further
construction, management and operation for 50 years. Now due to a variety of
reasons, the five shareholders of Jingrong want to transfer all their shares to
Zhaoheng. Under the principle of equality and mutual benefit, after friendly
negotiation and with the consent of Rongjiang County Government of Guizhou
Province, both parties reached the following agreement regarding the transfer of
shares and consumption of corporate debt and related costs:

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

    
      	
              1.  

            	
              The
      ownership of Rongjing's shares is following: Wu Huimin 40%; Liu
      Jian-Hua15%; Xu Jin-Gen 15%; Ye Huajie 15%; and Mei Xiangdong 15%. The
      Shareholders will transfer all their shares to Zhaoheng. After the share
      transfer, Jingrong will continue to fulfill all rights and obligations
      defined in the Transfer Agreement. Meanwhile, all preferential policies
      offered by the Government to Jingrong will remain
    unchanged.

            

    

    
      	 	 
	
              2.  

            	
              The
      Shareholders shall be liable for all liabilities related to the share
      (such as mortgage, pledge or
guarantees).

            

    

    
      	 	 
	
              3.  

            	
              Zhaoheng
      shall pay 1 million RMB to Shareholders in exchange of 100% of Jingrong’s
      shares.

            

    

    
      	 	 
	
              4.  

            	
              In
      addition, Zhaoheng shall assume all of Jingrong’s debts and payables
      amounts to 49 million RMB.

            

    

    
      	 	 
	
              5.  

            	
              Shareholders,
      after receipt of payments outlined in item 3 and 4, shall guarantee
      Zhaoheng free from any contingent liability generated before this
      agreement. Otherwise, Shareholders shall bear the burden of any such
      liability. The two parties all signed a separate Warranty Contract, in
      which a mutually agreed guarantor provided extra security for such
      liabilities. The Warranty Contracts, as an appendix of this agreement, is
      equally effective to this
agreement.

            

    

     

    
      	
              6.  

            	
              Zhaoheng
      shall pay 5 million RMB to Shareholders as a deposit no later than the
      third business day following the Transfer Agreement. The deposit should be
      deemed as payable to Shareholders after both parties fulfill their
      obligations defined in this agreement. If Shareholder default under this
      agreement due to reasons other than governmental agencies, the deposit
      should be returned to Zhaoheng at double amount; If Zhaoheng default under
      this agreement, Zhaoheng shall forfeit its right to recover the deposit
      from Shareholders.

            

    

     

    
      	
              7.  

            	
              The
      shareholders, after receipt of the deposit, shall transfer its asset
      (including Yongfu Hydropower Station) and archival material (including
      corporate stamp) to Zhaoheng. Shareholders shall be liable for all
      liabilities of the assets before the transfer and shall guarantee the
      safety of assets and the integrity of archival material at the time of
      transfer. At the same time, the two parties shall register the changing of
      shareholders; changing of corporate article; changing of business
      registration with government agencies. Shareholders shall provide all the
      necessary documents and information (that should be provided by
      Shareholders) for such changes. From the date Industrial and Commercial
      Administration Departments approves the transfer of shares, Shareholders
      will no longer enjoy any interest in
Jingrong.

            

    

     

    
      	
              8.  

            	
              Zhaoheng
      shall pay the rest of 45 million RMB to the Shareholders within 5 business
      days after the change of shareholders took effective. Otherwise,
      Shareholders can terminate this agreement by a written notice and the
      deposit shall be deemed forfeited by Zhaoheng. However, the 1.85 million
      RMB payables such as construction fees, equipment cost shall be reimbursed
      to Shareholders only with relevant receipts. Otherwise, Zhaoheng will
      withhold the unpaid portion of the
payables.

            

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    
      	
              9.  

            	
              Taxes
      and government fees and charges rising from this share transfer will be
      paid in accordance with the provisions of relevant state laws. Other taxes
      and charges not covered by relevant laws will be paid by
      Zhaoheng.

            

    

     

    
      	
              10.  

            	
              In
      case that both parties agree to dismiss this agreement, Shareholders shall
      return the deposit, together with interest (calculated by bank lending
      rate over the same period), to Zhaoheng within 15 business days. A daily
      interest of 0.5% will be added to all overdue payment in case Shareholders
      default.

            

    

     

    
      	
              11.  

            	
              All
      disputes rising from this share transfer shall be resolved through
      negotiation or the plaintiff can sue the defendant in local district
      Court.

            

    

     

    
      	
              12.  

            	
              This
      agreement can be dismissed in the following
  occasions:

            

    

     

    
      	
               
      

            	
                   1:
      Both parties agree to dismiss this agreement due to changing circumstances
      and without harm to the national interests and social
    welfare.

            

    

     

    
      	
               
      

            	
                  
      2: Due to force majeure factors, the two parties can not fulfill all
      obligations outlined in this
agreement.

            

    

     

    
      	
               
      

            	
                
        3: One party default under this agreement during contractual
      period without any objection from the other
  party.

            

    

     

    
      	
              13.  

            	
              During
      the following cases, any one party can terminate this agreement with a
      written notice to the other party without having to bear any legal
      responsibility.

            

    

     

    
      	
               
      

            	
                  
      1: The other party provided false declaration or guarantee in this
      agreement.

            

    

     

    
      	
               
      

            	
                  
      2: The other seriously violated this agreement and damaged the interests
      of the other party.

            

    

     

    
      	
              14.  

            	
              If
      there are other issues which are not covered by this agreement, the two
      parties will sign a separate agreement after
  negotiation.

            

    

     

    
      	
              15.  

            	
              This
      agreement is in 7 copies, effective after being signed and sealed by both
      parties. Of the seven copies, Zhaoheng and Shareholders will each keep two
      copies; Rongjiang County Government will keep one copy; Jingrong will keep
      one copy; and the other copy will be submitted to the Industrial and
      Commercial Administrative Department for registration purpose. All copies
      are equally effective.

            

    

     

     

    
      	
              Transfer
      :

            	
              Transferee:

            

    

     

    
      	
                             

            	
              Signature
      of Legal Representative:

            

    

     

    
      	
              Date

            	
              Date

            

    

     

    
      Opinion
of Rongjiang County Government of Guizhou Provincekl06024_ex10-2.htm

    
      

    

     

    Exhibit 10.2

    
 

    Warranty

    

    Party A:
Wu Huimin, Liu Jian-Hua, Xu Jin-Gen, Ye Huajie and Mei Xiangdong.

    

    Party B:
Hunan Zhaoheng Hydropower Co. Ltd.

    Legal
representative: Zhu Hong, Title: Chairman.

    Address:
Dianzhan Road, Shimen County, Hunan Province.

    

    Party C
(Guarantor): Huimin Hydropower Development Co., Ltd.

    Legal
Representative: Wu Huimin Title: Chairman.

    Address:
84 Fuqian East Road, Xihe Town, She Autonomous Region, Jingning County, Zhejiang
Province.

    

    On June
15, 2008, Party A and Party B signed the "Equity Transfer Agreement of Jingrong
Industrial Development Co., Ltd. in Rongjiang County of Guizhou Province"
(hereinafter referred to “Transfer Agreement”). In the agreement, Party A
transferred all its shares in Jingrong Industrial Development Co., Ltd to Party
B. Under Item 5 of the agreement, Party B’s only obligation is the payment
outlined in the agreement and is not liable for any other liabilities. However,
after Party B fulfill its obligations under item 3 and item 4, there might still
have some contingent liabilities with Jingrong Industrial Development Co., Ltd.
The agreement provides that such contingent liabilities shall be guaranteed by a
third party agreed by mutual parties. Now, Party C is willing to provide
guarantee to above mentioned contingent liabilities, which is also agreed by
Party A and Party B. The three parties reached the following
agreement:

    

    
      	
              1.  

            	
              Party
      C is jointly liable for and is willing to guarantee all contingent
      liabilities mentioned in Transfer
Agreement.

            

    

    
      	 	 
	
              2.  

            	
              This
      guarantee is valid within two years from the date any contingent liability
      arises in the future.

            

    

    
      	 	 
	
              3.  

            	
              This
      guarantee is in three copies, effective after being signed / sealed by all
      three parties. The three parties will each keep one copy. As appendix to
      of Transfer Agreement, it’s equally effective to the Transfer
      Agreement.

            

    

     

    
      	
              Party
      A:

            	
              Party
      B:

            	
              Party
      C:

            

    

     

    
      	
              Date

            	
              Date

            	
              Date

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