Document:

ex101.htm

    EXHIBIT
10.1

    EXCLUSIVE LICENSE
AGREEMENT

    

    

    THIS EXCLUSIVE LICENSE AGREEMENT dated
as of September 14, 2009 (this “Agreement”), by and
between GLOBAL TECHNOLOGIES GROUP, INC. (“Global”) and ANASAZI
CAPITAL CORP. a Florida corporation (“ACP”).

    

    WHEREAS, Global is the owner of an
exclusive license for North, South, Central America, Canada and Russia, the MBS
Process (as hereinafter defined), a patented hazardous heavy metal remediation
process;

    

    WHEREAS, ACP wishes to purchase, and Global
desires to grant ACP, an exclusive sub license for the country of Mexico of the
MBS Process for remediating Brownfield and Redevelopment Sites (as hereinafter
defined) and may or may not, in conjunction with associate developers, states,
cities or towns develop and operate such Brownfield and Redevelopment Sites for
industrial, commercial, residential, recreational or other productive uses;
and

    

    WHEREAS,
ACP desires to have
Global provide expertise for all remediation work, including remediation of
heavy metal pollution in soils and other untreated wastes, in the Brownfield and
Redevelopment Sites by the use of the MBS Process, and Global desires to do
so;

    

    NOW,
THEREFORE, in consideration of the mutual promises and undertakings herein set
forth, and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Global and ACP hereby agree as
follows:

    

    1.   DEFINITIONS

    

    For all
purposes of this Agreement, the following terms shall have the meanings
specified below:

    

    “Contaminated
Site”:  a site contaminated with hazardous heavy metals and may
also be contaminated with low-level radioactive waste and may be a Superfund
Site.

    

     “Brownfield”:  any
real estate site, which may or may not be, designated by the local or other
governmental authorities as a “Brownfield Site” otherwise suitable for
commercial, residential or other for-profit productive use but which, due to the
presence or suspected presence at such site of heavy metal contaminants in the
soil, is currently either not being utilized at all, or is being underutilized,
for commercial or other productive use.

    

    “Superfund
Site”:  any site determined by the U.S. Environmental
Protection Agency to be contaminated to such a degree that it
constitutes a health hazard to the local community and environment, and which has
accordingly been registered on the National Priorities List, which is available for
purchases and development.

     

    “Redevelopment
Site”:  any project involving the remediation of
a Contaminated Site and the development and operation of such Contaminated
Site or industrial, commercial,
residential, recreational or other productive use which are owned by ACP.

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

    

     “MBS
Patents”:  (i) the U.S. and foreign patents listed on Exhibit A
hereto; (ii) any patents which shall issue on any of the patents listed
on Exhibit
A hereto or on any improvements thereof, and any reissues, reexamination,
renewals or extensions thereof; (iii) any divisional, continuation or
continuation-in-part patent which shall be based on the patents described in
Exhibit
A; and (iv) patents and patent corresponding to each of the
above-described patents which shall subsequently issue are issued, filed, or to
be filed in any foreign country, any patents which shall subsequently issue
thereof, and any renewals, divisions, reissues, continuations or extensions
thereof. “U.S. Patent
Office”: the United States Patent and Trademark Office.

    

    “MBS
Process”:  Global’s long term heavy metal soil remediation
process, for which patent have been issued as listed on Exhibit A
hereto, to stabilize by the addition of proprietary non-hazardous reagents to
the contaminated materials under increased moisture conditions in order to
convert such contaminated materials into an insoluble, stable, non-hazardous
metal sulfide, together with any improvement, enhancement or expansion of such
long term heavy metal soil remediation process.

    

    2.  RIGHTS GRANTED BY GLOBAL TO
ACP

    

    
      	
               
      

            	
              2.1

            	
              Global
      hereby grants ACP
      and ACP hereby
      accepts from Global, an exclusive sub license under the MBS Patents to use
      the MBS Process for the purpose of remediating Brownfield and
      Redevelopment Sites for the country of
Mexico.

            

    

    

    3.  COMPENSATION FOR RIGHTS
GRANTED

    

    
      	
               
      

            	
              3.1.

            	
              Global
      shall receive the following compensation from ACP for the rights
      granted by Global hereunder:

            	 

    

    

    
      	
               
      

            	
              (a)

            	
              A
      payment of $1,250,000 U.S. at the closing hereunder to be paid in the form
      of a Certified check or other form of compensation that Global deems
      acceptable and a minimum annual royalty payment of $150,000 per annum,
      payable semiannually in the amount of $75,000, provided that the first
      payment thereof shall be prorated for the period through December 31,
      2009. In the event of non payment of the above mentioned royalties, ACP
      shall have 10 days to cure this default or this license granted will
      become null and void. See Section 5.1 (i)
below.

            

    

    

    
      	
               
      

            	
              (b)

            	
              All
      MBS Chemicals must be purchased exclusively from Global unless otherwise
      agreed to in writing by Global.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Should
      ACP purchase and
      sell or purchase and develop the Brownfield or Redevelopment property
      after remediation, Global will receive a 1% royalty of the sales price.
      Should ACP, its
      officers, partners or affiliates participate in ownership in any way with
      the development of the property after the sale of the property Global must
      receive its 1% royalty of the total development
  cost.

            

    

    

    
      	
               
      

            	
              (d)

            	
              Global
      will provide all in-house technical expertise as required for free. ACP will pay for all
      out-of-pocket expenses associated with site visits and other travel such
      as air fare, hotels, meals and ground
  transportation.

            

    

    

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    4.  SUBLICENSING

    

    
      	
               
      

            	
              4.1

            	
              The
      rights granted to ACP hereunder may not be
      sublicensed or transferred without the prior written consent of
      Global.

            

    

    

    5.  REPRESENTATIONS
AND WARRANTIES

    

    
      	
               
      

            	
              5.1

            	
              Global
      represents and warrants and covenants and agrees
  that:

            

    

    

    
      	
               
      

            	
              (a)

            	
              It
      is the sole owner of the exclusive rights granted to it under license to
      the MBS Patents and the MBS Process for North, South, Central America and
      Russia and  that it has the full and unrestricted right and
      power to grant the sub licenses granted herein and that it knows of no
      prior art or other information which would invalidate the MBS
      Patents;

            

    

    

    
      	
               
      

            	
              (b)

            	
              The
      execution, delivery and performance of this Agreement has been duly
      authorized by all necessary corporate action on the part of Global (no
      consent of its shareholders or any trustee or holder of any debt or other
      obligation of Global being required); such execution, delivery and
      performance by Global will not violate any indenture, agreement, contract,
      commitment, judgment, decree, order or legal restriction binding upon it
      or to which it is a party; and this Agreement has been duly executed and
      delivered by Global and constitutes the legal, valid and binding
      obligation of Global;

            

    

    

    
      	
               
      

            	
              (c)

            	
              It
      has the exclusive license for the patents listed on Exhibit
      A to this Agreement with the governmental authorities specified on
      such Exhibit
      A;

            

    

    

    
      	
               
      

            	
              (d)

            	
              Global
      has not licensed the MBS Process to any other party, and except in
      connection with remediation work being performed by or to be performed by
      Global in connection with contracted or negotiated remediation projects
      involving Global existing on the date hereof, Global has not agreed that
      any other person may use the MBS
Process;

            

    

    

    
      	
               
      

            	
              (e)

            	
              To
      the best knowledge of Global, the grant to ACP of the licenses
      granted herein does not infringe any rights of any third party;
      and

            

    

    

    
      	
               
      

            	
              (f)

            	
              There
      are no claims or actions asserting infringement with respect to the MBS
      Patents or the MBS Process pending or, to the best knowledge of Global,
      threatened against Global in the territories mentioned in the
      agreement.

            

    

    

    
      	
               
      

            	
              (g)

            	
              Global
      will (a) take all actions necessary to prosecute the patent listed in
      Exhibit
      A to issue and (b) diligently seek patent protection under U.S. and
      foreign laws for the patenting of the
MBS

            

    

    

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    
      	
               
      

            	
              (h)

            	
              If
      Global fails to deliver or manufacture the MBS materials needed for the
      MBS process, ACP
      will be granted with the right for the manufacture of these materials as
      long as ACP orders
      chemicals from Global in a timely manner and meets the accepted payment
      terms. Should ACP
      manufacture the MBS chemicals, ACP must pay Global a
      Royalty of 25% of costs in recognition of Global’s ownership and
      development of the MBS patented process and for Global’s continued need
      for know-how relevant to remediation projects. In any event ACP will not sell the
      MBS patented chemicals or chemical process to any third party without
      Global’s written approval. Such an action would be in violation of this
      Agreement and of Global’s patent rights. Global will have the right to
      audit all cost records of ACP on a Quarterly basis
      should ACP
      manufacture chemicals for the MBS process as may be allowed in this
      paragraph.

            

    

    

    
      	
               
      

            	
              (i)

            	
              Except
      to the extent prohibited by law, either party may, at its option and
      without notice, terminate this Agreement, effective immediately, in the
      event the other party hereto (i) fails to make a minimum royalty payment
      hereunder, (ii) admits in writing its inability to pay its debts, (iii) is
      adjudicated by a court of competent jurisdiction as being insolvent or
      (iv) has a decree entered against it by a court of competent jurisdiction
      appointing a receiver, liquidator, trustee or assignee in insolvency
      covering all or substantially all of such party’s property (which
      appointment is not vacated within sixty (60) days of the entry of the
      order of appointment) or providing for such liquidation of such party’s
      property or business affairs.

            

    

    

    
      	
               
      

            	
              (j)

            	
              Should
      Global sell, assign or merge with another company, the rights under this
      contract shall survive and be transferred to new owners. In the event of a
      bankruptcy or other liquidation of Global, ACP will maintain its rights to
      the MBS Process pursuant to this
Agreement.

            

    

    

    
      	
               
      

            	
              5.2

            	
              ACP represents and
      warrants and covenants and agrees
that:

            

    

    

    
      	
               
      

            	
              (a)

            	
              It
      has the full and unrestricted right to enter into and fully perform this
      Agreement;

            

    

    

    
      	
               
      

            	
              (b)

            	
              The
      execution and delivery of this Agreement and the performance hereof by it
      will not violate and indenture, agreement, contract, commitment, judgment,
      decree, order or legal restriction binding upon it or which it is a party;
      and

            

    

    

    
      	
               
      

            	
              (c)

            	
              The
      Agreement has been duly authorized, executed and delivered by ACP and constitutes the
      legal, valid and binding obligation of ACP.

            

    

    

    
      	
               
      

            	
              (d)

            	
              ACP also agrees to
      perform the following tasks:

            

    

    

    
      	
               
      

            	
              ·

            	
               Hire (or identify
      for hiring) a core staff, consultants and key personnel experienced in
      land use, zoning, real estate development and financial analysis and
      management;

            

    

    

    
      	
               
      

            	
              ·

            	
              Retain
      necessary consultants (environmental, land use,
  etc.);

            

    

    

    
      	
               
      

            	
              ·

            	
              Identify,
      when known, with Global, a selection of Brownfield locations that show a
      high degree of potential for successful
  development;

            

    

    

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    
      	
               
      

            	
              ·

            	
              Develop,
      with Global, detailed feasibility studies with respect to 2-4 Brownfield
      locations selected for immediate development;
  and

            

    

    

    
      	
               
      

            	
              ·

            	
              Raise
      capital sufficient to promote the marketing and sales of the MBS
      Brownfield Technology;

            

    

    

    
      	
               
      

            	
              ·

            	
              Provide
      Global with written quarterly sales, marketing and
    performance

            

    

    
      	
               
      

            	
              reports.

            

    

    

     6.       ASSISTANCE

    

    Global
will provide ACP with
such technical assistance and other  materials and information related
to the MBS Process as ACP, in good faith, deems of
significant importance to the promotion and application of the MBS
Process.

    

    7.           INFRINGEMENT

    

    
      	
               
      

            	
              7.1

            	
              Global
      agrees to enforce the MBS Patents (after issuance thereof) against
      infringement by third parties upon notification by ACP to Global with the
      request that Global proceed to take such steps to end such infringement.
      If Global does not institute an infringement suit within 90 days after
      ACP written
      request that it do so, or if Global institutes such action but thereafter
      fails to press such action vigorously, ACP may institutes and
      prosecute such lawsuit in the name of Global and add Global to such action
      as a party plaintiff, and Global hereby consents
  thereto.

            

    

    

    
      	
               
      

            	
              7.2

            	
              Any
      action for infringement of the MBS Patents (whether by Global
      or  ACP
      as it relates to this contract) shall be prosecuted solely at the
      cost and expense of Global. Any sums recovered in any such action shall be
      divided proportionately between Global and ACP after deduction of
      all reasonable expenses and attorney’s fees, on the basis of their
      respective actual damages suffered as a result of such
      infringement.

            

    

    

    
      	
               
      

            	
              7.3

            	
              Each
      party hereto agrees to inform the other party hereto of the possible
      infringement by a third party of the MBS Patents and to fully cooperate
      with the other party hereto in the prosecution of any action for
      infringement of the MBS Patents.

            

    

    

    
      	
               
      

            	
              7.4

            	
              Without
      ACP prior written
      consent, Global may not agree to any compromise or settlement of any third
      party claim relating to the MBS Process, which could reasonably be
      expected to have an adverse effect on the rights granted by Global to
      ACP hereunder.
      This consent may not be unreasonably
withheld.

            

    

    

    8.           INDEMNITY

    
      

      
        	
                 
      

              	
                8.1

              	
                Global
      agrees to defend, indemnify and hold ACP its members,
      officers, directors, agents, sublicenses and employees harmless from any
      and all claims, demands, causes of action, costs, expenses and losses
      (including reasonable attorney’s fees and costs) resulting from (i) any
      action brought by a third party claiming that the exercise by ACP of its rights under
      the license granted to it pursuant to Section
      2 infringed the rights of such third party or (ii) any
      representation or warranty of Global contained in Section
      5.1 being false or
      incorrect or breached in material respect. The provisions of this Section
      8.1 shall survive the expiration or termination of this Agreement
      for any reason and shall not be affected
  thereby.

              

      

       

      
        
          
          

        

        
          -5-

          
            

          

        

        
          
          

        

      

    

    
      	
               
      

            	
              8.2

            	
              ACP agrees to defend,
      indemnify and hold Global, its shareholders, officers, directors, agents,
      sublicenses and employees harmless from any and all claims, demands,
      causes of action, costs, expenses and losses (including reasonable
      attorneys’ fees and costs) resulting from any representation or warranty
      of ACP contained
      in Section
      5.2 being false or incorrect or breached in any material respect.
      The provisions of this Section
      8.2 shall survive the expiration or termination of this Agreement
      for any reason and shall not be affected
  thereby.

            

    

    

    9.           TERM

    

    
      	
               
      

            	
              9.1

            	
              The
      term of this Agreement shall be 15 years or, from the date of
      issuance     of any of the patents listed on
      Exhibit
      A attached as granted to Global by the U.S. Patent Office with
      respect to the MBS Process, until the expiration of the last of such
      patents, whichever is longer.

            

    

    

    10.           CONFIDENTIALITY

    

    
      	
               
      

            	
              10.1

            	
              Each
      party hereto shall maintain as strictly confidential the terms and
      conditions of this Agreement between ACP and Global, and
      shall not disclose the same to any other person, provided, however, that
      (i) any party may disclose any such terms and conditions (a) to such
      parties officers, employees, counsel, accountants, auditors and
      representatives who, in any such case, have a need to know such
      information in connection with the performance of their services for such
      party; (b) to, or as required by, any governmental body or regulatory
      authority pursuant to such party’s good faith interpretation of any law,
      rule or regulation to which such party may subject, including, without
      limitation, or any other legal proceeding between the parties; and (c)
      ACP may disclose
      any such terms and conditions to potential investors in ACP and its investment
      bankers and advisors on a confidential basis; and (ii) the obligations of
      the parties hereunder with respect to confidentiality shall not apply to
      any information that is or becomes publicly known or available through no
      fault of the disclosing party.

            

    

    

    
      	
               
      

            	
              10.2

            	
              ACP acknowledges that
      the MBS Patents and the MBS Process  constitutes a valuable
      asset and trade secret of Global and further acknowledges that Global has
      an exclusive proprietary right and interest in and to the MBS Patents and
      the MBS Process under an exclusive license and that any information,
      corrections, programs and work product conceived, created or developed
      alone or with ACP
      and others relating in any way to the MBS Patents and the MBS Process is
      confidential trade secret information and may not be made available to nor
      disclosed to any third party without prior consent of Global. Upon the
      expiration or termination of this Agreement, ACP shall promptly
      return to Global all proprietary and confidential information in this
      possession relating to the MBS Patents and the MBS Process delivered or
      disclosed to ACP
      during the performance of this
Agreement.

            

    

    

    11.           NOTICES

    
      

      
        	
                 
      

              	
                11.1

              	
                Notices and other communications given
      hereunder shall be in writing and shall
      be deemed to have been adequately given and delivered when received by the
      party to which such notice is being given after the same shall have been
      deposited in the mail, registered or certified, with postage prepaid, or
      deposited with any telegraphic or cable agency, with charges prepaid for
      immediate transmission, or delivered by express courier, or transmitted by
      facsimile and receipt of such transmission appropriately confirmed, and
      addressed as
follows:

              

      

       

      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

      

    

    To:           Anasazi
Capital
Corp.             To:
Global Technologies Group, Inc.

    513
Vintage
Way                           1304
North Lake Shore Dr.

    Brandon,
Florida
33511                 Sarasota,
Florida 34231

    Attn:
Joel
Edison                            Attn:
James Fallacaro

    

    Or to
such other address as the party to receive such notice may from time to time
designate in writing to the other party.

    

    12.           MISCELLANEOUS

    
      

      
        	
                 
      

              	
                12.1

              	
                This Agreement shall inure to the benefit of
      and shall be binding upon Each
      of the party’s hereto and there respective successors and assigns. Neither
      party hereto may assign this Agreement or its rights hereunder to any
      other party without the prior written consent of the other party
      hereto.

              

      

      
        
          

          
            	
                     
      

                  	
                    12.2

                  	
                    THIS AGREEMENT SHALL BE
      GOVERNED BY AND CONSTRUES IN ACCORDANCE WITH THE LAWS OF THE STATE OF
      FLORIDA. ANY CASE, CONTROVERSY, SUIT, ACTION OR PROCEEDING ARISING OUT OF
      OR IN CONNECTION WITH OR RELATED TO THIS AGREEMENT SHALL BE BROUGHT IN ANY
      FEDERAL OR STATE COURT LOCATED IN THE COUNTRY AND STATE OF FLORIDA AND
      EACH OF ACP AND GLOBAL IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH
      COURT INANY SUCH SUIT, ACTION OR
      PROCEEDING.

                  

          

           

        

      

    

    
      	
               
      

            	
              12.3

            	
              This
      Agreement embodies the entire agreement and
      understanding   between ACP and Global relating
      to the subject matter hereof and supersedes all prior agreements and
      understandings relating to the subject matter
  hereof.

            

    

    

    
      	
               
      

            	
              12.4

            	
              This
      Agreement may be executed in any number of counterparts, each of
      which shall be an original, but all of which together shall constitute one
      instrument.

            

    

    
      

      
        	
                 
      

              	
                12.5

              	
                
                  The
      division of this Agreement into Sections and the insertion of
      headings  are for convenience of reference only and shall not
      affect the construction or
      interpretation of this
Agreement.

                

              

      

       

    

    
      	
               
      

            	
              12.6

            	
              This
      Agreement shall not in any manner be amended, supplemented or modified
      except by a written instrument executed on behalf of the parties hereto
      by their duly authorized
representatives.

            

    

            

    
      
        	
                 
      

              	
                12.7

              	
                Any
      provision of this Agreement that is prohibited or unenforceable in
      any jurisdiction
      shall, as to such jurisdiction, ineffective to the extent of such
      prohibition
      or unenforceability in any jurisdiction shall (to the full extent
      permitted by law) not invalidate or render unenforceable such provision in
      any other jurisdiction.

              

      

                 

      
        	
                 
      

              	
                12.8

              	
                Each
      covenant contained herein shall be construed (absent express provision
      to the contrary) as being independent of each other covenant herein,
      so that compliance with any one covenant shall not (absent such an express
      contrary provision) be deemed to excuse compliance with any other
      covenant. Where any provision herein refers to action to betaken by any
      person, or which such person is prohibited from taking, such provision
      shall be applicable whether such action is taken directly by such
      person.

              

      

       

      
        
          
          

        

        
          -7-

          
            

          

        

        
          
          

        

      

    

    IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed by their duly
authorized representatives.

     

    
      
        	 	GLOBAL TECHNOLOGIES GROUP,
      INC.	 
	 	 	 	 
	 	
                By:
      

              	/s/ James
      Fallacaro	 
	 	 	James
      Fallacaro	 
	 	 	President	 
	 	 	 	 

      

      
        	 	ANASAZI CAPITAL
      CORP.	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ Joel
      H. Edelson	 
	 	 	Joel
      H. Edelson	 
	 	 	President	 
	 	 	 	 

      

    

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    EXHIBIT
A

    

    DESCRIPTION OF
PATENTS

    

    The MBS
technology is a product of U.S patents developed, filed and issued to Solucorp
Industries, Ltd., U.S. Patent numbers 5,898,093 and 5,877,393. Global
Technologies Group, Inc. has an exclusive license from Solucorp Industries, Ltd.
for North, Central, South America, Canada and Russia for Brownfield and
Redevelopment properties which was purchased by and issued to Global
Technologies Group, Inc. on October 20, 2008.

    

    
      
        
        

      

      
        -9-exfiftytwo.htm

 

 

 

 

 

 

 

September  29, 2009

Mr. Henry Jia

Mr. Frank Zheng

Mr. Yuan Da Xia

Re: Binding Plan for the Deconsolidation of JPI

Dear  Sirs:

The Following is a binding plan regarding the proposed deconsolidation of and financing for Jade Pharmaceuticals, Inc. (“JPI”); sale of ordinary shares of JPI to Mssrs. Henry Jia, Frank Zheng and Yuan Da Xia  (the “China Shareholders”); and the other events that will lead to AMDL, Inc. (“ADL”)  losing
management and Board control of and owning a minority interest in JPI (collectively, the “Deconsolidation Plan”).

	
Item
	  	
Description

	  	  	  
	
Structure:
	  	
The Deconsolidation Plan will take place in the following manner:

 

1.JPI will amend its Articles of Incorporation to increase its authorized capital to 100 million ordinary shares.

2.ADL’s current ownership of 1 share of JPI will be exchanged for approximately 28 million new shares of JPI (with no voting rights) common stock such that ADL will hold 1 share of JPI common stock for each dollar of net asset value of JPI as determined by an independent valuation of JPI to be completed prior to close of the Definitive
Agreements (as defined herein), which value is currently estimated at approximately $28 million dollars.

3.The China Shareholders will convert their past due salaries of ADL (approximately $900,000) into new shares of JPI common stock (that has full voting rights) equal to approximately three (3%) percent of JPI based on an independent valuation of JPI.

4.The China Shareholders will exchange approximately 500,000 shares of ADL common stock, which they currently own, for such number of new shares of JPI common stock (that has full voting rights) based on the 5-day VWAP at closing and the independent valuation of JPI.

 

The parties acknowledge and understand that by agreeing to items 1-4 no economic benefits will flow to AMDL from the operations of JPI unless JPI issues a dividend or AMDL is able sell its shares in JPI. There are no current planned JPI dividends and or potential sales of AMDL’s shares in JPI.

 

The parties further acknowledge and understand that by agreeing to items 1-4 and the changes to the Board of Directors of JPI discussed below it will eventually lead to AMDL losing complete control of JPI at the shareholder, management and Board levels.

 

Following completion of steps 1 to 4:

 

5.JPI will authorize an equity incentive plan for management with the ability to issue additional shares of JPI common stock equal to approximately 34% of JPI based on certain to be determined performance goals.

6.ADL will convert approximately $5.5 million of inter-company advances to JPI into an unsecured promissory note with an interest rate of 12%.  Such note or portion thereof will be convertible prior to an IPO, provided that ADL’s ownership of JPI upon conversion cannot exceed 49%.

7.JPI will commence a private placement during the 4th quarter of 2009, for the sale of up to 50% interest in JPI.

8.JPI will agree to use its best efforts to complete an IPO on the Shenzhen Stock Exchange, Hong Kong Stock Exchange, Shanghai Stock Exchange or a similar exchange by September 30, 2012, wherein it will sell to the public such number of JPI shares as are equal to an approximately 25% interest in JPI at that time.

 

 

	  	  	  
	
Definitive Agreements:
	  	
The parties will use their best efforts to negotiate the following agreements (collectively, the “Definitive Agreements”):

 

1.JPI Shareholders Agreement between the China Shareholders and ADL.  This agreement will detail the rights and duties of the parties.

2.Debt Conversion Agreement between ADL, the China Shareholders and JPI.

3.Share Exchange Agreement between ADL, the China Shareholders and JPI.

4.Debt Conversion Agreement and Promissory Note between ADL and JPI.

 

 

	  	  	  
	
Timeline:
	  	
The Parties will use their best efforts to complete the plan of Deconsolidation in accordance with the following timeline:

 

1.October 2009 – Entry into Definitive Agreements between JPI, ADL and the China Shareholders.

2.October 2009 – Completion and approval of Equity Incentive Plan for JPI.

3.October 2009 – Complete independent valuation of JPI.

4.November – December 2009 – Commence and close private placement of JPI stock.

5.Prior to September 30, 2012 – Complete IPO of JPI stock on Shenzhen, Hong Kong, Shanghai or similar stock exchange.

 

	  	  	  
	
Ownership Post Deconsolidation Plan
	  	
Because there are a number of events that cannot be determined with certainty, it is difficult to determine the exact ownership of ADL at any given time during the deconsolidation process, however, it is currently anticipated the ADL’s ownership interest will progressively decrease such that following the completion of the private
placement of JPI stock and assuming that JPI achieves certain performance goals, ADL will own less than 50% of JPI common stock prior to the commencement of the proposed IPO.

 

	  	  	  
	
Board Composition:
	  	
Upon close of the Definitive Agreements, JPI will take the necessary corporate actions to create a five-person Board of Directors, of which the China Shareholders shall appoint 3 members and ADL shall appoint 2 members. Provided, further, that at such time as ADL’s ownership interest drops below 20% ADL shall have the right to appoint
not more than one (1) member of JPI’s Board; and, at such time as ADL’s ownership drops below 10% it shall no longer have the right to appoint members to JPI’s Board.

	  	  	  
	
Confidentiality:
	  	
Until such time as the parties negotiate and execute the Definitive Agreements, the parties agree to keep this term sheet confidential; provided, however, that ADL may make such disclosures as it or its counsel deem necessary and appropriate pursuant to SEC or NYSE-Amex rules and regulations in its sole discretion.

	  	  	  
	
Binding Nature of Term Sheet:
	  	
Based upon ratification by ADL’s Board of Directors, the terms set forth herein, except for the requirement of Confidentiality, shall be binding on the parties and are intended to illustrate the intentions of the parties on a go-forward basis until such time as they are superseded by the Definitive Agreements.

 

Please indicate your agreement to the foregoing by signing below.

 

	  	
Very Truly Yours,

ADL, INC.

 

By:_______________________________

Douglas MacLellan

Chief Executive Officer

 

	
AGREED TO AND ACCEPTED

on September __,  2009:

 

___________________________

Henry Jia

 

___________________________

Frank Zheng

 

___________________________

Yuan Da Xia

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