STOCK FOR STOCK EQUIVALENT EXCHANGE AGREEMENT AND PLAN
STOCK
FOR STOCK EQUIVALENT
EXCHANGE
AGREEMENT AND PLAN
THIS
SHARE EXCHANGE AGREEMENT, dated as of the [__]
day of October, 2007 (the “Agreement”), by and among Teeka Tan Products, Inc., a
Delaware corporation
(the “Company”); Taiyuan Rongan Business Trading Company Limited, a Chinese
private company with an Operating License within the People’s Republic of China
duly issued to Mr. Aizhong An as the Authorized Representative (“TRBT”); and all
of the current TRBT Capital Contributors, each of whom has executed a
counterpart signature page to this Agreement (each, a “Shareholder” and
collectively, the “Shareholders”). The Company, TRBT and the
Shareholders are collectively referred to herein as the “Parties.”
W I T N E
S S E T H:
WHEREAS,
the Shareholders own all of the issued and outstanding capital of TRBT (the
“TRBT Shares”).
WHEREAS,
the parties to this Agreement intend to enter into a tax free exchange under the
U.S. Internal Revenue Service Regulations whereby the TRBT Shareholders will
assign 80% of 100% of the capital contributions in TRBT to the Company in
exchange for designated restricted common shares of the Company to be issued in
accordance with this Agreement;
WHEREAS,
the Company desires to transfer to the Shareholders, and the Shareholders desire
to acquire from the Company, 31,500,000 common shares of the Company as listed
on Schedule
A attached hereto;
WHEREAS,
the Company shall issue 1,400,000 warrants exercisable at the rate of one
warrant for one share of Company Common Stock at a price of $0.50 per share
(post- Roll Back) to an entity to be provided by TRBT prior to the
Closing;
WHEREAS,
in consideration for services provided, the Company shall issue to Mirador
Consulting 500,000 warrants exercisable at the rate of one warrant for one share
of Company Common Stock at a price of $1.00 per share (post- Roll Back) with an
expiration date one-year from the date of this Agreement;
WHEREAS,
TRBT states that all of its present assets, as summarily described in the
attached and incorporated Schedule
B of TRBT Assets and Liabilities, will be wholly owned by 6 subsidiaries,
each of which owns one property and each of which subsidiary is owned 76% by
TRBT at the closing of this Agreement, and such ownership by TRBT is not subject
to any claims or encumbrances except as set-out in Schedule
B;
WHEREAS,
it is intended that upon the closing of this Stock for Stock Equivalent Share
Exchange Agreement, the existing securities holders of the Company, including
the holders of stocks and warrants, shall together have no more than ten percent
(10%) of the shares (including warrants and options, if any) in the combined
entity.
WHEREAS,
the business purpose of the corporation will change from the marketing of sun
care products, to the building and operation of commercial real estate in
China.
NOW,
THEREFORE, in consideration, of the promises and of the mutual representations,
warranties and agreements set forth herein, the parties hereto agree as
follows:
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ARTICLE
I
THE
EXCHANGE
1.1 The
Exchange
(a) Upon the
terms and subject to the conditions of the Agreement, and in accordance with the
Corporation Laws of the State of Delaware as to the Company and the Company Laws
of the People’s Republic of China (“Chinese Law”) as to TRBT, the parties hereto
shall effect the following stock for stock equivalent exchange as provided
herein at Closing effective upon the Effective Time. TRBT represents
it can affirm and approve this Agreement by consent of its Authorized
Representative and sole shareholder.
(b) In
consideration of the mutual terms, covenants and conditions contained herein,
the Company shall issue and deliver to the Shareholders and/or their designees
31,500,000 shares of Company Common Stock as set forth opposite their and/or
their designee’s names on Schedule
A hereto or pursuant to separate instructions to be delivered prior to
Closing. Promptly after Closing, the Company Common Stock will be
delivered by the Company Transfer Agent to the designated owners for the benefit
of each TRBT Shareholder or designated assign, or to a shareholder
representative identified in writing who shall be the Authorized Representative
of TRBT. The shares will be legally issued and fully negotiable,
except as to customary restrictions on transferability of unregistered
stock.
(c) The
Company shall also issue and deliver warrants for the purchase of 1,400,000
shares of Company Common Stock post-Roll Back at a price of $0.50 per share to
the TRBT Shareholders and/or their designees in accordance with the distribution
set forth on Schedule
A.1 hereto or pursuant to separate instructions to be delivered prior to
Closing.
(d) In
addition, the Company shall issue or cause to be issued to Mirador Consulting
500,000 warrants post-Roll Back exercisable at the rate of one warrant for one
share of Company Common Stock at an exercise price of $1.00 per share and an
expiration date of one year from the Closing Date.
(e) In
consideration of the mutual terms, covenants and conditions contained herein,
the TRBT Shareholders agree, at closing, to contribute, transfer,
assign and convey 80% of the outstanding stock equivalent of TRBT, consisting of
registered capital in the registered amount of RMB 1.28 million. The
TRBT Shareholders further covenant and warrant that they will physically deliver
assignment of their proof of payment of capital of each of the shareholders at
closing and provide the Company at closing with TRBT’s adopted Board of
Shareholders Resolutions showing that 80% of TRBT capital contributions are
deemed transferred to the Company as set-out in Schedule
A in exchange for the designated shares of the Company Common
Stock.
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(f) At
closing, the Parties will execute and deliver the various separate certificates,
checks, agreements, resolutions, assignments, opinions, Amended Articles of the
Company, filings under Regulation “S” of the Securities Act of 1933 or other
applicable exemption from registration for the common shares issued to the TRBT
shareholders. The foregoing documents shall be delivered in draft
form to the respective parties not less than 5 days before
closing. Notwithstanding the execution of such separate documents for
record or recording purposes, this Agreement shall constitute and evidence the
intent to enter a final and complete exchange of shares in accord with its
terms.
(g) The
recitals in this Agreement shall be incorporated as binding facts, conditions,
obligations and undertakings on the parties.
1.2 Prior
to the Closing. Prior to
the Effective Time and as a condition to Closing, the Company shall undertake a
1 for 100 reverse stock split of the Company Common Stock (the “Pre-Closing
Shares) before any Company Common Stock is issued pursuant to this
Agreement.
1.3 Post
Closing Company Shares Outstanding. At the
completion of the Closing and the Roll Back, there will be issued and
outstanding the following Company Common Stock:
(a) Common
Shares: The total number of common shares to be delivered to the
Shareholders and/or their designees shall be 31,500,000, so that after the
exchange, the TRBT Shareholders shall own 90% of the common stock of the
Company, and the total number of common shares issued and outstanding shall be
35,000,000;
(b) Other
Securities: the Company shall have warrants and stock options issued
and outstanding in the following amounts: (i) 20,000 warrants issued to Charnin,
Calhoun, Long with the exercise price of $15.00 and expiration date of May 12,
2008; (ii) 10,000 share option to purchase TKAT common stock issued to ▇▇▇▇▇▇▇
with the exercise price of $5.00 (Restricted Stock with no registration rights)
and an expiration date of March 2011; (iii) 1,400,000 warrants issued to an
entity to be designated by TRBT prior to Closing with an exercise price of
$0.50; and (iv) 500,000 warrants issued to Mirador Consulting with an exercise
price of $1.00 and expiration date of one year from the date of the
Closing;
(c) After
Closing, there will be 200,000,000 authorized Company common shares and there
will be 10,000 authorized but unissued Company preferred
shares.
1.4 Time
and Place of Closing
Subject
to the conditions set forth in Article VII being completed and the delivery of
all documents set forth in Article VI, the closing of the transactions
contemplated hereby (the “Closing”) shall take place upon satisfaction or waiver
by the appropriate parties of all conditions precedent, at the offices of
_______________ on or before ________
__, 2007 (the “Closing Date”) at _:__ _.m. Pacific Time, or at such place
and time as mutually agreed upon by the parties hereto.
1.5 Effective
Time .The
Exchange shall become effective (the “Effective Time”) at such time as all of
the conditions set forth in Article VII hereof have been satisfied or waived by
the Parties hereto.
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1.6 Tax
Consequences .It is
intended by the parties hereto that for United States income tax purposes, the
contribution and transfer of the TRBT Shares by the Shareholders to the Company
in exchange for Company Shares constitutes a tax-deferred exchange within the
meaning of Section 351 of the Code.
1.7 Result
of Stock for Stock Equivalent Exchange. When the stock for
stock equivalent exchange has been fully consummated and implemented, the
following results or status to the parties shall be extant:
(a) The
Company will continue as a reporting company under SEC regulations with
ownership of and entitlement to 80% of shares/capital contribution of
TRBT.
(b) The
Bylaws of the Company, as in effect immediately prior to the closing, shall be
the Bylaws of the Company, but subject to amendment.
(c) The
persons nominated below shall be appointed at closing as interim directors of
the Company pursuant to election. The Directors named below shall
immediately upon appointment and following the closing hold an organizational
meeting of the Board to, inter
alia,
appoint the new officers for the Company as also set-out
below:
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|
DIRECTORS:
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1. Aizhong
An
2. ▇▇▇▇▇▇
▇▇▇
3. ▇▇▇▇▇▇
▇▇▇
4. Junhui
An
5. ▇▇▇▇
▇. ▇▇▇▇▇▇▇▇
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|
OFFICERS:
|
1. Aizhong
An, Chairman/CEO
2. ▇▇▇▇▇▇
▇▇▇, President/COO/Secretary
3. ▇▇▇▇▇▇
▇▇▇ , Vice President/CFO/Treasurer
4. Junhui
An, Vice President
(d) The
current officers of the Company, at closing, shall resign and new officers will
be appointed by the newly appointed board of directors as set forth
above.
(e) TRBT
understands that the above named director and officer nominees do not need to
disclose estimated direct and indirect compensation for such nominees; but, have
agreed to attach and incorporate Schedule
C to this Agreement setting out initial direct and indirect compensation
and share ownership/capital contribution.
(f) After
closing, the corporate name of the Company may remain unchanged, or may be
changed by approval of its board. Authority of the Company Board to electively
change such name shall be approved as part of the proxy, if any.
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ARTICLE
II
REPRESENTATIONS
AND WARRANTIES OF THE COMPANY
As an
inducement to, and to obtain the reliance of TRBT, the Company represents and
warrants as follows:
2.1 Due
Organization and Qualification; Due Authorization.
(a) The
Company is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware, with full corporate power and
authority to own, lease and operate its respective business and properties and
to carry on its business in the places and in the manner as presently conducted
or proposed to be conducted. The Company has the full power and
authority to conduct the business in which it will engage upon completion
of the transaction contemplated herein. The Company is in good standing as a
foreign corporation in each jurisdiction in which the properties owned, leased
or operated, or the business conducted, by it requires such qualification except
for any such failure, which when taken together with all other failures, is not
likely to have a material adverse effect on the business of the
Company. Accurate, current and complete copies of the Articles
of Incorporation and Bylaws of the Company are attached hereto as Schedule
D (1).
(b) The
Company does not own, directly or indirectly, any capital stock, equity or
interest in any corporation, firm, partnership, joint venture or other entity
except its subsidiaries a list of which are set forth on Schedule
D (2)
(c) The
Company has all requisite corporate power and authority to execute and deliver
this Agreement, and to consummate the transactions contemplated hereby and
thereby. The Company has taken all corporate action necessary for the execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby, and this Agreement constitutes the valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms, except as may be affected by bankruptcy, insolvency, moratoria or
other similar laws affecting the enforcement of creditors’ rights generally and
subject to the qualification that the availability of equitable remedies is
subject to the discretion of the court before which any proceeding therefore may
be brought, equitable remedies is subject to the discretion of the court before
which any proceeding therefore may be brought.
2.2 No
Conflicts or Defaults. The
execution and delivery of this Agreement by the Company and the consummation of
the transactions contemplated hereby do not and shall not (a) contravene the
Articles of Incorporation, as amended, or By-laws of the Company or (b) with or
without the giving of notice or the passage of time (i) violate, conflict with,
or result in a breach of, or a default or loss of rights under, any material
covenant, agreement, mortgage, indenture, lease, instrument, permit or license
to which the Company is a party or by which the Company is bound, or any
judgment, order or decree, or any law, rule or regulation to which the Company
is subject,
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(ii)
result in the creation of, or give any party the right to create, any lien,
charge, encumbrance or any other right or adverse interest (“Liens”) upon any of
the assets of the Company, (iii) terminate or give any party the right to
terminate, amend, abandon or refuse to perform, any material agreement,
arrangement or commitment to which the Company is a party or by which the
Company’s assets are bound, or (iv) accelerate or modify, or give any party the
right to accelerate or modify, the time within which, or the terms under which,
the Company is to perform any duties or obligations or receive any rights or
benefits under any material agreement, arrangement or commitment to which it is
a party.
2.3 Authorization;
Enforcement. The
person or entity executing these documents on behalf of the Company has the
requisite corporate power and authority to enter into and to consummate the
transactions contemplated in this Agreement and otherwise to carry out its
obligations hereunder and thereunder. The execution and delivery of
this Agreement by the Company and the consummation by it of the transactions
contemplated hereby thereby have been duly authorized by all necessary action on
the part of the Company and no further action is required by the Company, its
board of directors or its stockholders in connection therewith other than as set
forth in this Agreement. This Agreement has been (or upon delivery
will have been) duly executed by the Company and, when delivered in accordance
with the terms hereof and thereof, will constitute the valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms except (i) as limited by general equitable principles and applicable
bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (ii) as
limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies and (iii) insofar as indemnification and
contribution provisions may be limited by applicable law.
2.4 Capitalization
The
authorized capital stock of the Company immediately prior to giving effect to
the transactions contemplated hereby consists of 200,000,000 shares of Company
Common Stock at $0.0001 par value and 10,000 shares have been designated as
authorized blank check preferred stock. Prior to the Roll Back, there
were 87,906,665 shares of Company Common Stock issued and outstanding and 0
shares of company Preferred Stock issued and outstanding. All of the
outstanding shares of Company Common Stock are, and the Company Shares when
issued in accordance with the terms hereof, will be, duly authorized, validly
issued, fully paid and nonassessable, and have not been or, with respect to the
Company Shares will not be issued in violation of any preemptive right of
stockholders. Prior to the Closing, the only other issued and outstanding
securities of the company, other than common stocks, were: 1,999,999 warrants of
which all are exercisable at $.15 per share and expire on May 12, 2008 and
1,000,000 options to purchase company stock exercisable at $.05 per share and
expire in March 2011 (the amounts and exercise prices of these securities have
been modified in accordance with the Roll Back). There is no
outstanding voting trust agreement or other contract, agreement,
arrangement, call, commitment or other right of any character
obligating or entitling the Company to issue, sell, redeem or repurchase any of
its securities, and there is no outstanding security of any kind convertible
into or exchangeable for Company Common Stock. The Company has not granted
registration rights to any person.
2.5 Subsidiaries.
The
Company has one subsidiary, Teeka Tan, Inc.
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2.6 No
Assets or Liabilities. Except
as set forth on the Financial Statements and as incurred in the ordinary course
of business, or for those not incurred in the ordinary course of business as set
forth on Schedule
E hereto, the Company does not have any (a) assets of any kind or (b)
liabilities or obligations, whether secured or unsecured, accrued, determined,
absolute or contingent, asserted or unasserted or otherwise.
2.7 Taxes. The
Company has filed all United States federal, state, county and local returns and
reports which were required to be filed on or prior to the date hereof in
respect of all income, withholding, franchise, payroll, excise, property, sales,
use, value-added or other taxes or levies, imposts, duties, license and
registration fees, charges, assessments or withholdings of any nature whatsoever
(together, “Taxes”), and has paid all Taxes (and any related penalties, fines
and interest) which have become due pursuant to such returns or reports or
pursuant to any assessment which has become payable, or, to the extent its
liability for any Taxes (and any related penalties, fines and interest) has not
been fully discharged, the same have been properly reflected as a liability on
the books and records of the Company and adequate reserves therefore have been
established.
2.8 Indebtedness;
Contracts; No Defaults. Except
as otherwise disclosed, the Company’s periodic reports available on the ▇▇▇▇▇
filing system contain an accurate, current and complete list and
description of each contract and agreement required to be disclosed, whether
written or oral, other than this Agreement, (the "Contracts") to which the
Company is a party to or by which the Company or any of its assets are
bound. An accurate, current and complete copy of the
Contracts has been or will be made available to TRBT for inspection and
copying. No claim of breach of contract, tort, product liability or
other claim, contingent or otherwise, has been asserted or threatened
against the Company nor, to the best of the Company's knowledge, is capable of
being asserted by any employee, creditor, claimant or other person against the
Company. No state of facts exists or has existed, nor has any
event occurred, which could give rise to the assertion of any such claim by
any person.
2.9 Offers. There
are no outstanding offers, bids, proposals or quotations made by the Company
which, if accepted, would create a Contract with the Company.
2.10 Contracts. On the
Closing Date:
(a) The only
material contract, franchise agreement, license agreement, or other commitment
to which the Company is a party or by which it or any of its properties are
bound is the Exclusive Distribution Agreement with ▇▇▇▇▇▇▇ of which they entered
into an Addendum to terminate the exclusive portion of the Agreement and the
Company no longer orders product from ▇▇▇▇▇▇▇ pursuant to the Exclusive
Distribution Agreement.
(b) The
Company is not a party to any contract, agreement, commitment or instrument or
subject to any charter or other corporate restriction or any judgment, order,
writ, injunction, decree or award materially and adversely affects, or in the
future may (as far as the Company can now foresee) materially and adversely
affect, the business, operations, properties, assets or conditions of
prevention.
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(c) The
Company is not a party to any material oral or written: (i) contract for the
employment of any officer or employee; (ii) profit sharing, bonus, deferred
compensation, stock option, severance pay, pension benefit or retirement plan,
agreement or arrangement covered by Title IV of the Employee Retirement Income
Security Act, as amended; (iii) agreement, contract or indenture relating to the
borrowing of money; (iv) guaranty of any obligation for the borrowing of money
or otherwise, excluding endorsements made for collection and other guaranties,
of obligations, which, in the aggregate exceeds $1,000; (v) consulting or other
contract with an unexpired term of more than one year or providing for payments
in excess of $10,000 in the aggregate; (vi) collective bargaining agreement;
(vii) contract, agreement or other commitment involving payments by it for more
than $10,000 in the aggregate.
2.11 Compliance
with Law. The
Company is in compliance with all applicable federal, state, local and foreign
laws and regulations relating to the protection of the environment and human
health. There are no claims, notices, actions, suits, hearings, investigations,
inquiries or proceedings pending or, to the knowledge of the Company, threatened
against the Company that are based on or related to any environmental matters or
the failure to have any required environmental permits, and there are no past or
present conditions that the Company has reason to believe are likely to give
rise to any material liability or other obligations of the Company under any
environmental laws. The Company has not generated any hazardous
wastes or engaged in activities which are or could be interpreted to be
potential violations of laws or judicial decrees in any manner regulating
the generation or disposal of hazardous waste. There are no on-site or
off-site locations where the Company has stored, disposed or arranged for
the disposal of chemicals, pollutants, contaminants, wastes, toxic
substances, petroleum or petroleum products; there are no underground
storage tanks located on property owned or leased by the Company, and no
polychlorinated biphenyls are used or stored at any property owned or leased by
the Company.
2.12 Permits
and Licenses. The
Company has all certificates of occupancy, rights, permits, certificates,
licenses, franchises, approvals and other authorizations as are reasonably
necessary to conduct its respective business and to own, lease, use, operate and
occupy its assets, at the places and in the manner now conducted and operated,
except those the absence of which would not materially adversely affect its
respective business.
2.13 Litigation. There
is no claim, dispute, action, suit, proceeding or investigation pending or, to
the knowledge of the Company, threatened, against or affecting the business of
the Company, or challenging the validity or propriety of the transactions
contemplated by this Agreement, at law or in equity or admiralty or before any
federal, state, local, foreign or other governmental authority, board, agency,
commission or instrumentality, nor to the knowledge of the Company, has any such
claim, dispute, action, suit, proceeding or investigation been pending or
threatened, during the twelve month period preceding the date hereof. Except as
disclosed on Schedule
F hereto, there is no outstanding judgment, order, writ, ruling,
injunction, stipulation or decree of any court, arbitrator or federal, state,
local, foreign or other governmental authority, board, agency, commission or
instrumentality, against or materially affecting the business of the Company
except as set out in Schedule F. The Company has not received any written or
verbal inquiry from any federal, state, local, foreign or other governmental
authority, board, agency, commission or instrumentality concerning the possible
violation of any law, rule or regulation or any matter disclosed in respect of
its business.
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2.14 Patents;
Trademarks and Intellectual Property Rights. The
Company does not own or possesses any patents, trademarks, service marks, trade
names, copyrights, trade secrets, licenses, information, Internet web site(s) or
proprietary rights of any nature.
2.15 Securities
Law Compliance. The
Company has complied with all of the applicable requirements of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) and the Securities Act of
1933, as amended (the “Securities Act”), except as otherwise disclosed in the
SEC Reports, and has complied in all material respects with all applicable blue
sky laws in all material respects, except as otherwise disclosed in the SEC
Reports.
2.16
Officers,
Directors, Agents, etc. ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ are the sole officers and directors of the
Company. ▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇ have employment agreements with
the Company until April 15, 2008 (the “Company Employment
Agreements”). To date, Mr. John and ▇▇. ▇▇▇▇▇▇ have accrued
approximately $150,000 in unpaid salary under the Company Employment
Agreements. All employment contracts shall be cancelled and
terminated and all accrued but unpaid salaries will be forgiven prior to the
Closing Date.
2.17 Labor
Matters. The Company is not a party to: (i) any profit
sharing, pension, retirement, deferred compensation, bonus, stock option, stock
purchase, retainer, consulting, health, welfare or incentive plan or
agreement or other employee benefit plan, whether legally binding or not;
or (ii) any plan providing for "fringe benefits" to its employees, including,
but not limited to, vacation, disability, sick leave, medical, hospitalization
and life insurance and other insurance plans, or related benefits; or (iii) any
employment agreements other than those particular employment agreements
with the officers and directors. No person or party including, but
not limited to, governmental agencies of any kind, has any claim or basis for
any action or proceeding against the Company arising out of any statute,
ordinance or regulation relating to discrimination in employment or to
employment practices or occupational safety and health
standards.
2.18 Books
and Records. The Company’s books and records, financials and
others, are and have been properly prepared and maintained in form and substance
adequate for preparing audited financial statements in accordance with generally
accepted accounting principles, and fairly and accurately reflect all of
the Company’s assets, obligations and accruals, and all transactions (normally
reflected in books and records in accordance with generally accepted
accounting principles) to which the Company is or was a party or by which
the Company or any of its assets are or were affected.
2.19 Consents. The
execution, delivery and performance by the Company of this Agreement and the
consummation by the Company of the transactions contemplated hereby do not
require any consent that has not been received prior to the date hereof, except
as for the Roll Back.
2.20 Conduct
Since Date of Balance Sheet. Except as otherwise set forth
herein, none of the following has occurred since the date of the Balance
Sheet:
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(a) Any
material adverse change in the financial condition, obligations,
capitalization, business, prospects or operations of the Company, nor are there
any circumstances known to the Company which might result in such a material
adverse change or such an effect;
(b) Any
increase of indebtedness of the Company other than in the ordinary course of
business;
(c) Any
settlement or other resolution of any dispute or proceeding other than in the
ordinary course of business;
(d) Any
cancellation by the Company, without payment in full, of any obligation to
the Company of any shareholder, director, officer or employee of the Company (or
any member of their respective families), or any entity in which any
shareholder, director or officer of the Company (or any member of their
respective families) has any direct or indirect interests;
(e) Any
obligation incurred by the Company other than in the ordinary course of
business;
(f) Any
payment, discharge or satisfaction of any obligation or judgment, other than in
the ordinary course of business; or
(g) Any
agreement obligating the Company to do or take any of the actions referred to in
this Section outside the ordinary course of business.
2.21 Full
Disclosure. All the representations and warranties made
by the Company herein or in any Schedule, and all of the statements, documents
or other information pertaining to the transaction contemplated herein made or
given by the Company, its agents or representatives, are complete and accurate
and does not contain any untrue statement of material fact or omit any
information required to make the statements and information provided, in light
of the transaction contemplated herein, non-misleading, accurate and
meaningful.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF TRBT
As an
inducement to, and to obtain the reliance of the Company, TRBT represents and
warrants as follows:
3.1 Due
Organization and Qualification; Subsidiaries, Due
Authorization. TRBT is a company with an Operating License and
an Authorized Representative validly existing and in good standing under the
laws of the People’s Republic of China, Shanxi Province, City of Taiyuan and has
its current principal business address in ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇, but intends to locate its principal U.S. offices at ▇▇▇
▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇. TRBT and its
Authorized Representative has the power and authority and all material
governmental licenses, authorizations, permits, consents and approvals required
to use the land and own, license or lease and operate its properties and to
conduct its business as presently conducted by it in the manner and location
where conducted.
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3.2 Authorization;
Enforcement. The person or entity executing these documents on
behalf of TRBT has the requisite corporate power and authority to enter into and
to consummate the transactions contemplated in this Agreement and otherwise to
carry out its obligations hereunder and thereunder. The execution and
delivery of this Agreement by TRBT and the consummation by it of the
transactions contemplated hereby thereby have been duly authorized by all
necessary action on the part of TRBT and no further action is required by TRBT,
its board of directors or its stockholders in connection therewith other than as
set forth in this Agreement. This Agreement has been (or upon
delivery will have been) duly executed by TRBT and, when delivered in accordance
with the terms hereof and thereof, will constitute the valid and binding
obligation of TRBT enforceable against TRBT in accordance with its terms except
(i) as limited by general equitable principles and applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (ii) as limited by laws
relating to the availability of specific performance, injunctive relief or other
equitable remedies and (iii) insofar as indemnification and contribution
provisions may be limited by applicable law.
3.3 No
Conflicts or Defaults. The
execution and delivery of this Agreement by TRBT and the consummation of the
transactions contemplated hereby do not and shall not (a) contravene the
governing documents of TRBT or any of its subsidiaries, or (b) with or without
the giving of notice or the passage of time, (i) violate, conflict with, or
result in a breach of, or a default or loss of rights under, any material
covenant, agreement, mortgage, indenture, lease, instrument, permit or license
to which TRBT or any of its subsidiaries is a party or by which TRBT or any of
its subsidiaries or any of their respective assets are bound, or any judgment,
order or decree, or any law, rule or regulation to which their assets are
subject, (ii) result in the creation of, or give any party the right to create,
any lien upon any of the assets of TRBT or any of its subsidiaries, (iii)
terminate or give any parry the right to terminate, amend, abandon or refuse to
perform any material agreement, arrangement or commitment to which TRBT is a
party or by which TRBT or any of its assets are bound, or (iv) accelerate or
modify, or give any party the right to accelerate or modify, the time within
which, or the terms under which TRBT is to perform any duties or obligations or
receive any rights or benefits under any material agreement, arrangement or
commitment to which it is a party.
3.4 Capitalization.
(a) The
entire registered capital of TRBT consists of RMB 1.6 million contributed by 1
capital contributor. In addition:
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(i)
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there
are no warrants, options or other stock rights, conversion
privileges, stock purchase plans or other agreements or undertakings which
obligate TRBT now or upon the occurrence of some future event to issue
shares of capital stock, or to transfer or assign its registered
capital.
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(ii)
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there
are no restrictions on the transfer or assignment of proof of payment of
capital of TRBT other than those imposed by relevant U.S. state and
federal securities laws, and
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11
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(iii)
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no
capital contributor of TRBT is entitled to any preemptive or similar
statutory or contractual rights, either arising pursuant to an agreement
or instrument to which TRBT is a party or which are otherwise binding on
TRBT.
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(b) The
capital contributions of the shareholders have been duly made to the company as
evidenced by the proof of payment issued by TRBT.
(c) The
persons named herein as the TRBT Shareholders hold all the equity interest of
TRBT and such equity interest is transferable pursuant to this Agreement, and
title is fully and exclusively vested in the TRBT Shareholders as such capital
contributors’ interest is identified in Schedule
A as attached and incorporated.
3.5 Subsidiaries. TRBT
has six (6) subsidiaries and TRBT owns seventy six percent (76%) of
each.
3.6 Taxes. TRBT
has filed all returns and reports which were required to be filed on or prior to
the date hereof, and has paid all Taxes (and any related penalties, fines and
interest) which have become due pursuant to such returns or reports or pursuant
to any assessment which has become payable, or, to the extent its liability for
any Taxes (and any related penalties, fines and interest) has not been fully
discharged, the same have been properly reflected as a liability on the books
and records of TRBT and adequate reserves therefore have been established. All
such returns and reports filed on or prior to the date hereof have been properly
prepared and are true, correct (and to the extent such returns reflect judgments
made by TRBT such judgments were reasonable under the circumstances) and
complete in all material respects. Except as indicated in the Disclosure
Schedule, no extension for the filing of any such return or report is currently
in effect. Except as indicated on the Disclosure Schedule, no tax return or tax
return liability of TRBT has been audited or, presently under audit. All taxes
and any penalties, fines and interest which have been asserted to be payable as
a result of any audits have been paid. Except as indicated on the Disclosure
Schedule, TRBT has not given or been requested to give waivers of any statute of
limitations relating to the payment of any Taxes (or any related penalties,
fines and interest). There are no claims pending for past due Taxes. Except as
indicated on the Disclosure Statement, all payments for withholding taxes,
unemployment insurance and other amounts required to be paid for periods prior
to the date hereof to any governmental authority in respect of employment
obligations of TRBT have been paid or shall be paid prior to the Closing and
have been duly provided for on the books and records of TRBT and in the TRBT
Financial Statements.
3.7 Financial
Statements. Schedule
B to this Agreement, includes copies of the (i) balance sheet of TRBT at
December 31, 2005 and 2006, and the related statements of operations,
stockholders’ equity (deficit) and cash flows for the fiscal year then ended,
including the notes thereto, as audited by ▇▇▇▇▇▇ & Co., independent
registered public accounting firm, and (ii) unaudited balance sheet of TRBT at
July 31, 2007, and the related statements of operations, and cash flows for the
nine month period then ended (the “TRBT Financial Statements”). The Financial
Statements, together with the notes thereto, have been prepared in accordance
with U.S. generally accepted accounting principles applied on a basis consistent
throughout all periods presented. The Financial Statements present fairly the
financial position of TRBT as of the dates and for the periods indicated. The
books of account and other financial records of TRBT have been maintained in
accordance with good business practices.
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3.8 Compliance
with Law.
TRBT is conducting their respective businesses in material compliance with all
applicable law, ordinance, rule, regulation, court or administrative order,
decree or process, or any requirement of insurance carriers material to its
business. TRBT has not received any notice of violation or claimed violation of
any such law, ordinance, rule, regulation, order, decree, process or
requirement. TRBT has not generated any hazardous wastes or engaged
in activities which are or could be interpreted to be potential violations of
laws or judicial decrees in any manner regulating the generation or
disposal of hazardous waste. There are no on-site or off-site
locations where TRBT has stored, disposed or arranged for the disposal
of chemicals, pollutants, contaminants, wastes, toxic substances, petroleum
or petroleum products; there are no underground storage tanks located on
property owned or leased by TRBT.
3.9 Litigation:
(a) There
is no claim, dispute, action, suit, proceeding or investigation pending or
threatened, against or affecting TRBT or any of its subsidiaries or challenging
the validity or propriety of the transactions contemplated by this Agreement, at
law or in equity or admiralty or before any federal, state, local, foreign or
other governmental authority, board, agency, commission or instrumentality, has
any such claim, dispute, action, suit, proceeding or investigation been pending
or threatened, during the 12-month period preceding the date
hereof;
(b) There
is no outstanding judgment, order, writ, ruling, injunction, stipulation or
decree of any court, arbitrator or federal, state, local, foreign or other
governmental authority, board, agency, commission or instrumentality, against or
materially affecting TRBT or any of its subsidiaries; and
(c) Neither
TRBT nor its subsidiaries has received any written or verbal inquiry from any
federal, state, local, foreign or other governmental authority, board, agency,
commission or instrumentality concerning the possible violation of any law, rule
or regulation or any matter disclosed in respect of its business.
3.10 Consents. The
execution, delivery and performance by TRBT of this Agreement and the
consummation by TRBT of the transactions contemplated hereby do not require
any consent that has not been received prior to the date hereof, except as
disclosed in Section 7.1.
3.11 Books
and Records. TRBT's books and records are and have been
properly prepared and maintained in form and substance adequate for preparing
audited financial statements in accordance with generally accepted accounting
principles, and fairly and accurately reflect all of TRBT's assets,
obligations and accruals, and all transactions (normally reflected in books
and records in accordance with generally accepted accounting
principles) to which TRBT is or was a party or by which TRBT or any of its
assets are or were affected.
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3.12 Other
Liabilities. No claim of breach of contract, tort, product
liability or other claim (whether arising from TRBT's business operations or
otherwise), contingent or otherwise, has been asserted or threatened against
TRBT nor, to the best of TRBT's knowledge, is capable of being asserted by
any employee, creditor, claimant or other person against TRBT. No
state of facts exists or has existed, nor has any event occurred, which could
give rise to the assertion of any such claim by any person.
3.13 Conduct
Since Date of Balance Sheet. Except as otherwise set forth
herein, none of the following has occurred since the date of the Balance
Sheet:
(a) Any
material adverse change in the financial condition, obligations,
capitalization, business, prospects or operations of TRBT, nor are there any
circumstances known to TRBT which might result in such a material adverse change
or such an effect;
(b) Any
increase of indebtedness of TRBT other than in the ordinary course of
business;
(c) Any
settlement or other resolution of any dispute or proceeding other than in the
ordinary course of business;
(d) Any
cancellation by TRBT, without payment in full, of any obligation to TRBT of
any shareholder, director, officer or employee of TRBT (or any member of their
respective families), or any entity in which any shareholder, director or
officer of TRBT (or any member of their respective families) has any direct or
indirect interests;
(e) Any
obligation incurred by TRBT other than in the ordinary course of
business;
(f) Any
payment, discharge or satisfaction of any obligation or judgment, other than in
the ordinary course of business; or
(g) Any
agreement obligating TRBT to do or take any of the actions referred to in this
Section outside the ordinary course of business.
3.14 Consents. The
execution, delivery and performance by TRBT of this Agreement and the
consummation by TRBT of the transactions contemplated hereby do not
require any consent that has not been received prior to the date
hereof.
3.15 Judgments. There
is no outstanding judgment against TRBT. There is no health or safety
problem involving or affecting TRBT. There are no open workers
compensation claims against TRBT, or any other obligation, fact
or circumstance which would give rise to any right of indemnification on
the part of any current or former shareholder, partner, director, officer,
employee or agent of TRBT, or any heir or personal representative thereof,
against TRBT or any successor to the business of TRBT.
3.16 Improper
Payments. Neither TRBT, nor any of its current or former
shareholders, partners, directors, officers or employees or agents, nor any
person acting on behalf of TRBT, has, directly or indirectly, made any bribe,
kickback or other payment of a similar or comparable nature, whether lawful
or not, to any person, public or private, regardless of form, whether in
money, property or services, to obtain favorable treatment for business secured
or special concessions already obtained.
14
No
funds or assets of TRBT were donated, lent or made available directly or
indirectly for the benefit of, or for the purpose of supporting or opposing, any
government or subdivision thereof, political party, candidate or committee,
either domestic or foreign. TRBT has not maintained and does not
maintain a bank account, or any other account of any kind, whether domestic or
foreign, which account was not or is not reflected in the TRBT corporate books
and records, or which account was not listed, titled or identified in the name
of TRBT.
3.17 Full
Disclosure. All the representations and warranties made
by TRBT herein or in any Schedule hereto, and all of the statements,
documents or other information pertaining to the transaction contemplated
herein made or given by TRBT, its agents or representatives are complete
and accurate, and do not omit any information required to make the
statements and information provided, in light of the transaction
contemplated herein, non-misleading, accurate and meaningful.
ARTICLE
IV
REPRESENTATION
AND WARRANTIES OF THE SHAREHOLDERS
Each
Shareholder for himself, herself or itself only, and not with respect to any
other Shareholder, hereby severally represents and warrants to the Company that
now and/or as of the Closing:
4.1 Title
to Shares. Each of
the Shareholders is the legal and beneficial owner of the TRBT Shares to be
transferred to the Company by such Shareholders. Upon consummation of
the exchange contemplated herein, the Company will acquire from each of the
Shareholders good and marketable title to the TRBT Shares, free and clear of all
liens excepting only such restrictions upon future transfers by the Company, if
any, as may be imposed by applicable law.
4.2 Due
Authorization. Each of
the Shareholders has all requisite power and authority to execute and deliver
this Agreement, and to consummate the transactions contemplated hereby and
thereby. This Agreement constitutes the valid and binding obligation of each of
the Shareholders, enforceable against such Shareholders in accordance with its
terms, except as may be affected by bankruptcy, insolvency, moratoria or other
similar laws affecting the enforcement of creditors’ rights generally and
subject to the qualification that the availability of equitable remedies is
subject to the discretion of the court before which any proceeding therefore may
be brought.
4.3 Purchase
for Investment.
(a) Each of
the Shareholders is acquiring the Company Shares for investment for each of the
Shareholders’ own account and not as a nominee or agent, and not with a view to
the resale or distribution of any part thereof, and such Shareholders have no
present intention of selling, granting any participation in, or otherwise
distributing the same. Each of the Shareholders further represents that he, she
or it does not have any contract, undertaking, agreement or arrangement with any
person to sell, transfer or grant participation to such person or to any third
person, with respect to any of the Company Shares.
15
(b) Each of
the Shareholders understands that the Company Shares are not registered under
the Securities Act on the ground that the sale and the issuance of securities
hereunder is exempt from registration under the Act pursuant to Regulation S
thereof, and that the Company’s reliance on such exemption is predicated on each
of the Shareholders’ representations set forth herein.
4.4 Investment
Experience. Each of
the Shareholders acknowledges that he, she or it can bear the economic risk of
his or her investment, and has such knowledge and experience in financial and
business matters that he, she or it is capable of evaluating the merits and
risks of the investment in the Company Shares.
4.5 Information. Each of
the Shareholders has carefully reviewed such information as such Shareholders
deemed necessary to evaluate an investment in the Company Shares. To the full
satisfaction of each of the Shareholders, he, she or it has been furnished all
materials that he, she or it has requested relating to the Company and the
issuance of the Company Shares hereunder, and each Shareholder has been afforded
the opportunity to ask questions of representatives of the Company to obtain any
information necessary to verify the accuracy of any representations or
information made or given to the Shareholders. Notwithstanding the foregoing,
nothing herein shall derogate from or otherwise modify the representations and
warranties of the Company set forth in this Agreement, on which the Shareholders
has relied in making an exchange of the TRBT Shares for the Company
Shares.
4.6 Restricted
Securities. Each of
the Shareholders understands that the Company Shares may not be sold,
transferred, or otherwise disposed of without registration under the Act or an
exemption therefrom, and that in the absence of an effective registration
statement covering the Company Shares or any available exemption from
registration under the Act, the Company Shares must be held indefinitely. Each
of the Shareholders is aware that the Company Shares may not be sold pursuant to
Rule 144 promulgated under the Securities Act unless all of the conditions of
that Rule are met. Among the conditions for use of Rule 144 may be the
availability of current information to the public about the
Company.
4.7 Exempt
Issuance. Each
of the Shareholders acknowledges that he, she or it must assure the Company that
the offer and sale of the Company Shares to such Shareholder qualifies for an
exemption from the registration requirements imposed by the Securities Act and
from applicable securities laws of any state of the United
States. Each of the Shareholders agrees that he meets the criteria
established in one or more of subsections (a) or (b), below.
(a) Accredited
Investor, Section 4(2) of the Securities Act and/or Rule 506 of Regulation
D. The Shareholder qualifies as an “accredited investor”, as
that term is defined in Rule 501 of Regulation D, promulgated under the
Securities Act.
(b) Offshore
Investor, Rule 903 of Regulation S. The Shareholder is not a
U.S. Person, as defined in Rule 901 of Regulation S, promulgated under the
Securities Act, and the Shareholder, severally but not jointly, represents and
warrants to the Company that:
16
(i) The
Shareholder is not acquiring the Company Shares as a result of, and such
Shareholder covenants that e, she or it will not engage in any “directed selling
efforts” (as defined in Regulation S under the Securities Act) in the
United States in respect of the Company Shares which would include any
activities undertaken for the purpose of, or that could reasonably be expected
to have the effect of, conditioning the market in the United States for the
resale of any of the Company Shares;
(ii) The
Shareholder is not acquiring the Company Shares for the account or benefit of,
directly or indirectly, any U.S. Person;
(iii) The
Shareholder is a resident of the People’s Republic of China;
(iv) the offer
and the sale of the Company Shares to such Shareholder as contemplated in this
Agreement complies with or is exempt from the applicable securities legislation
of the People’s Republic of China;
(v) the
Shareholder is outside the United States when receiving and executing this
Agreement and that the Shareholder will be outside the United States when
acquiring the Company Shares,
(vi) and the
Shareholder covenants with Company that:
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(1)
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offers
and sales of any of the Company Shares prior to the expiration of a period
of one year after the date of original issuance of the Company Shares (the
one year period hereinafter referred to as the “Distribution Compliance
Period”) shall only be made in compliance with the safe harbor provisions
set forth in Regulation S, pursuant to the registration provisions of the
Securities Act or an exemption therefrom, and that all offers and sales
after the Distribution Compliance Period shall be made only in compliance
with the registration provisions of the Securities Act or an exemption
therefrom and in each case only in accordance with applicable state
securities laws; and
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(2)
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The
Shareholder will not engage in hedging transactions with respect to the
Company Shares until after the expiration of the Distribution Compliance
Period.
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ARTICLE
V
COVENANTS
5.1 Further
Assurances. Each of
the Parties shall use its reasonable commercial efforts to proceed promptly with
the transactions contemplated herein, to fulfill the conditions precedent for
such party’s benefit or to cause the same to be fulfilled and to execute such
further documents and other papers and perform such further acts as may be
reasonably required or desirable to carry out the provisions of this Agreement
and to consummate the transactions contemplated herein.
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ARTICLE
VI
DELIVERIES
6.1 Items to
be delivered to TRBT and/or the Shareholders prior to or at Closing by the
Company:
(a) Articles
of Incorporation and amendments thereto, By-laws and amendments thereto, and a
certificate of good standing in the Company’s state of
incorporation;
(b) all
applicable schedules hereto;
(c) all
minutes and resolutions of board of director and shareholder meetings in
possession of the Company;
(d) shareholder
list;
(e) all
financial statements and all tax returns in possession of the
Company;
(f) resolution
from the Company’s Board appointing the designees of the Shareholders to the
Company’s Board of Directors;
(g) resolution
from the Company’s Board, and if applicable, shareholder resolutions approving
this transaction and authorizing the issuances of the shares
hereto;
(h) letters
of resignation from the Company’s current officers and directors and
acknowledgement that any employment agreements with TKAT are cancelled and
terminated effective upon Closing and after the appointments described
herein;
(i) certificates
representing shares of the Company Shares issued in the denominations as set
forth opposite the name of the Shareholders and/or its designees on Schedule
A to this Agreement;
(j) an
opinion from counsel to the Company, dated the Closing Date, in a form deemed
acceptable by TRBT and its counsel; and
(k) any
other document reasonably requested by the Shareholders that it deems necessary
for the consummation of this transaction.
6.2 Items
to be delivered to the Company prior to or at Closing by TRBT and the
Shareholders:
(a) TRBT
shall deliver or assign to the Company the TRBT proof of payment of capital by
the respective capital contributors/shareholders listed on Schedule
A issued by TRBT, and execute and deliver the applicable documents of
conveyance and assignment of title;
18
(b) a
resolution that grants authority to the person or entity executing this
Agreement on behalf of TRBT to enter into the agreement and bind TRBT to the
terms and conditions of this Agreement;
(c) an
agreement from each Shareholder surrendering his or her shares agreeing to a
restriction on the transfer of the Exchange Stock as described in Section 2
hereof (“Offshore Restricted Securities Agreement”);
(d) a
copy of a consent of TRBT’s Board of Shareholders authorizing TRBT to
take the necessary steps toward Closing the transaction described by this
Agreement in the form set forth in Schedule B;
(e) Certificates
of Good Standing for TRBT by Gong An (Public Security) of Taiyuan;
(f) an
opinion by counsel to TRBT, dated the Closing Date, in a form deemed acceptable
by the Company and its counsel; and
(g) such
other documents, instruments or certificates as shall be reasonably requested by
the Company or its counsel.
ARTICLE
VII
CONDITIONS
PRECEDENT
7.1 Conditions
Precedent to Closing. The
obligations of the Parties under this Agreement shall be and are subject to
fulfillment, prior to the Effective Time of this Agreement, of each of the
following conditions:
(a) That each
of the representations and warranties of the Parties contained herein shall be
true and correct at the time of the Closing date as if such representations and
warranties were made at such time except for changes permitted or contemplated
by this Agreement;
(b) That the
Parties shall have performed or complied with all agreements, terms and
conditions required by this Agreement to be performed or complied with by them
prior to or at the time of the Closing;
(c) TRBT
shall have received, and delivered documentation of, the approvals required, if
any, from the Ministry of Commerce of the People’s Republic of China, the China
Securities Regulatory Commission, the State Administration of Foreign Exchange,
or any other Chinese governmental agency regulating the ownership of business
operations in China by non-Chinese nationals and/or the ownership of offshore
companies doing business in China by Chinese nationals;
(d) The
Company shall have received all of the regulatory, shareholder and other third
party consents, permits, approvals and authorizations necessary to consummate
the transactions contemplated by this Agreement;
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(e) The
Company shall have complied with Rule 14(f)(1) of the Exchange Act, if
required.
(f) The
Company shall have filed all quarterly and annual reports up to and including
the quarterly report due by November 14, 2007 for the third quarter of
2007. TRBT has agreed to pay the reasonable costs associated with
filing the 10Q for the third quarter of 2007.
(g) The
Company will effectuate an approximate 100 for 1 reverse split of the Company
Common Stocks of the Company prior to the time of closing (the “Roll
Back”).
(h) That
the Company shall have settled, paid or otherwise resolved the Convertible Notes
payable in the principal amount of $200,000 plus accrued interest;
(i) No
litigation shall have been instituted on or before the time of the Closing
by any person, the result of which did or could prevent or make illegal the
consummation of the transaction contemplated by this Agreement, or which
had or could have a material adverse effect on the business of any of the
Parties.
(j) TRBT
and the Shareholders shall have received all of the regulatory, shareholder and
other third party consents, permits, approvals and authorizations necessary to
consummate the transactions contemplated by this Agreement; and
(k) The
Shareholders shall have delivered to the Company the share certificates and duly
executed stock powers from the Shareholders transferring the TRBT Shares to the
Company.
ARTICLE
VIII
INDEMNIFICATION
8.1 Indemnity
of the Company. The
Company agrees as to defend, indemnify and hold harmless the Shareholders from
and against, and to reimburse the Shareholders with respect to, all liabilities,
losses, costs and expenses, including, without limitation, reasonable attorneys’
fees and disbursements (collectively the “Losses”) asserted against or incurred
by the Shareholders by reason of, arising out of, or in connection with any
material breach of any representation or warranty contained in this Agreement
made by the Company or in any document or certificate delivered by the Company
pursuant to the provisions of this Agreement or in connection with the
transactions contemplated thereby.
8.2 Indemnity
of the Shareholders. The
Shareholders, joint and severally, agree to defend, indemnify and hold harmless
the Company from and against, and to reimburse the Company with respect to, all
losses, including, without limitation, reasonable attorneys’ fees and
disbursements, asserted against or incurred by the Company by reason of, arising
out of, or in connection with any material breach of any representation or
warranty contained in this Agreement and made by the Shareholders or in any
document or certificate delivered by the Shareholders pursuant to the provisions
of this Agreement or in connection with the transactions contemplated thereby,
it being understood that the Shareholders shall have responsibility hereunder
only for the representations and warranties made by the
Shareholders.
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8.3 Indemnification
Procedure. A party
(an “Indemnified Party”) seeking indemnification shall give prompt notice to the
other party (the “Indemnifying Party”) of any claim for indemnification arising
under this Article VIII. The Indemnifying Party shall have the right to assume
and to control the defense of any such claim with counsel reasonably acceptable
to such Indemnified Party, at the Indemnifying Party’s own cost and expense,
including the cost and expense of reasonable attorneys’ fees and disbursements
in connection with such defense, in which event the Indemnifying Party shall not
be obligated to pay the fees and disbursements of separate counsel for such in
such action. In the event, however, that such Indemnified Party’s legal counsel
shall determine that defenses may be available to such Indemnified Party that
are different from or in addition to those available to the Indemnifying Party,
in that there could reasonably be expected to be a conflict of interest if such
Indemnifying Party and the Indemnified Party have common counsel in any such
proceeding, or if the Indemnified Party has not assumed the defense of the
action or proceedings, then such Indemnifying Party may employ separate counsel
to represent or defend such Indemnified Party, and the Indemnifying Party shall
pay the reasonable fees and disbursements of counsel for such Indemnified Party.
No settlement of any such claim or payment in connection with any such
settlement shall be made without the prior consent of the Indemnifying Parry
which consent shall not be unreasonably withheld.
ARTICLE
IX
TERMINATION
9.1 Termination. This
Agreement may be terminated at any time before or, at Closing,
by:
(a) The
mutual agreement of the Parties;
(b) Either
the Company or TRBT, but not by a Shareholder if-
(i) Any
provision of this Agreement applicable to a party shall be materially untrue or
fail to be accomplished; or
(ii) Any legal
proceeding shall have been instituted or shall be imminently threatening to
delay, restrain or prevent the consummation of this
Agreement;
(c) Upon
termination of this Agreement for any reason, in accordance with the terms and
conditions set forth in this paragraph, each said party shall bear all costs and
expenses as each party has incurred.
ARTICLE
X
COVENANTS
SUBSEQUENT TO CLOSING
10.1 Subsequent
SEC Filings. The
Chief Executive Officer and Chief Financial Officer, or other principal
administrative and financial officers, of the Company shall cooperate with and
assist TRBT with the preparation of the first Quarterly or Annual Report, as
applicable, to be filed with the Commission subsequent to the Closing to the
extent disclosure is required regarding the prior operations, financial
condition, or actions of, or other information pertaining to, the Company for
the period(s) ended prior to the Closing. Such cooperation and
assistance shall include, but not be limited to, provision of subcertifications
regarding the disclosures controls and procedures and internal control over
financial reporting of the Company, provision of and participation in review of
interim financial statements, and review and provision of feedback on a draft of
the required Report.
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ARTICLE
XI
MISCELLANEOUS
11.1 Survival
of Representations, Warranties and Agreements. Each of
the parties hereto is executing and carrying out the provisions of this
Agreement in reliance upon the representations, warranties and covenants and
agreements contained in this agreement or at the closing of the transactions
herein provided for and not upon any investigation which it might have made or
any representations, warranty, agreement, promise or information, written or
oral, made by the other party or any other person other than as specifically set
forth herein. Except as specifically set forth in this Agreement,
representations and warranties and statements made by a party to in this
Agreement or in any document or certificate delivered pursuant hereto shall not
survive the Closing Date, and no claims made by virtue of such representations,
warranties, agreements and covenants shall be made or commenced by any party
hereto from and after the Closing Date. Each warranty and
representation made by a party in this Agreement or pursuant hereto is
independent of all other warranties and representations made by the same party
in this Agreement or pursuant hereto (whether or not covering identical, related
or similar matters) and must be independently and separately
satisfied. Exceptions or qualifications to any such warranty or
representation shall not be construed as exceptions or qualifications to any
other warranty or representation.
11.2 Access
to Books and Records. During
the course of this transaction through Closing, each party agrees to make
available for inspection all corporate books, records and assets, and otherwise
afford to each other and their respective representatives, reasonable access to
all documentation and other information concerning the business, financial and
legal conditions of each other for the purpose of conducting a due diligence
investigation thereof. Such due diligence investigation shall be for the purpose
of satisfying each party as to the business, financial and legal condition of
each other for the purpose of determining the desirability of consummating the
proposed transaction. The Parties further agree to keep confidential and not use
for their own benefit, except in accordance with this Agreement any information
or documentation obtained in connection with any such
investigation.
11.3 Further
Assurances. If, at
any time after the Closing, the parties shall consider or be advised that any
further deeds, assignments or assurances in law or that any other things are
necessary, desirable or proper to complete the merger in accordance with the
terms of this agreement or to vest, perfect or confirm, of record or otherwise,
the title to any property or rights of the parties hereto, the Parties agree
that their proper officers and directors shall execute and deliver all such
proper deeds, assignments and assurances in law and do all things necessary,
desirable or proper to vest, perfect or confirm title to such property or rights
and otherwise to carry out the purpose of this Agreement, and that the proper
officers and directors the parties are fully authorized to take any and all such
action.
11.4 Notice. All
communications, notices, requests, consents or demands given or required under
this Agreement shall be in writing and shall be deemed to have been duly given
when delivered to, or received by prepaid registered or certified mail or
recognized overnight courier addressed to, or upon receipt of a facsimile sent
to, the party for whom intended, as follows, or to such other address or
facsimile number as may be furnished by such party by notice in the manner
provided herein:
22
If
to the Shareholders and TRBT:
Taiyuan
Rongan Business Trading Company Limited
▇▇▇
▇▇▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
With
a copy to:
▇▇▇▇▇▇
& ▇▇▇▇▇▇, LLP
Attn:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
If
to the Company:
Teeka Tan
Products, Inc.
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇
▇
▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
With a
copy to:
▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ & Beilly, LLP
▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇. ▇.▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
11.5 Entire
Agreement. This
Agreement, the Disclosure Schedules and any instruments and agreements to be
executed pursuant to this Agreement, sets forth the entire understanding of the
parties hereto with respect to its subject matter, merges and supersedes all
prior and contemporaneous understandings with respect to its subject matter and
may not be waived or modified, in whole or in part, except by a writing signed
by each of the parties hereto. No waiver of any provision of this Agreement in
any instance shall be deemed to be a waiver of the same or any other provision
in any other instance. Failure of any party to enforce any provision of this
Agreement shall not be construed as a waiver of its rights under such
provision.
11.6 Successors
and Assigns. This
Agreement shall be binding upon, enforceable against and inure to the benefit
of, the parties hereto and their respective heirs, administrators, executors,
personal representatives, successors and assigns, and nothing herein is intended
to confer any right, remedy or benefit upon any other person. This Agreement may
not be assigned by any party hereto except with the prior written consent of the
other parties, which consent shall not be unreasonably
withheld.
23
11.7 Governing
Law. This
Agreement shall in all respects be governed by and construed in accordance with
the laws of the State of Delaware are applicable to agreements made and fully to
be performed in such state, without giving effect to conflicts of law
principles.
11.8 Counterparts. This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
11.9 Construction.
Headings contained in this Agreement are for convenience only and shall not be
used in the interpretation of this Agreement. References herein to Articles,
Sections and Schedules are to the articles, sections and schedules,
respectively, of this Agreement. The Disclosure Schedule is hereby incorporated
herein by reference and made a part of this Agreement. As used herein, the
singular includes the plural, and the masculine, feminine and neuter gender each
includes the others where the context so indicates.
11.10 Severability. If any
provision of this Agreement is held to be invalid or unenforceable by a court of
competent jurisdiction, this Agreement shall be interpreted and enforceable as
if such provision were severed or limited, but only to the extent necessary to
render such provision and this Agreement enforceable.
11.11
Litigation. If
any party hereto is required to engage in litigation or arbitration against any
other party hereto, either as plaintiff or as defendant, in order to enforce or
defend any of its or his rights under this Agreement, and such litigation
results in a final judgment in favor of such party (the "Prevailing Party"),
then the party or parties against whom said final judgment is obtained shall
reimburse the Prevailing Party for all direct, indirect or incidental expenses
incurred by the Prevailing Party in so enforcing or defending its or his rights
hereunder, including, but not limited to, all attorneys' fees, paralegals' fees,
court costs and other expenses incurred throughout all negotiations, trials
or appeals undertaken in order to enforce the Prevailing Party's rights
hereunder.
24
IN
WITNESS WHEREOF, each of the parties hereto has executed this Agreement as of
the date first set forth above.
Teeka
Tan Products, Inc.
By:_____________________________
Name:
__________
Title:
Chairman
Taiyuan
Rongan Business Trading Company Limited
By:_____________________________
Name:
Title:
Chief Executive Officer
[SIGNATURE
PAGES FOR SHAREHOLDERS FOLLOW]
25
TAIYUAN
RONGAN BUSINESS TRADING COMPANY LIMITED
SHAREHOLDERS’
SIGNATURE PAGE TO
Dated:
October ___, 2007
Among
Teeka Tan Products, Inc.,
Taiyuan
Rongan Business Trading Company Limited, and
the
Shareholders of Taiyuan Rongan Business Trading Company Limited
The
undersigned Shareholder hereby executes and delivers the Share Exchange
Agreement (the “Agreement”)
to which this Signature Page is attached, which, together with all counterparts
of the Agreement and Signature Pages of the other parties named in said
Agreement, shall constitute one and the same document in accordance with the
terms of the Agreement.
|
(Signature)
|
|
|
(Type
or print name)
|
|
|
(Type
or print name as it should appear on certificate, if
different)
|
|
| Address: | |
| Telephone: | |
| Facsimile: | |
Number
of TRBT Shares Held:
26
SCHEDULE
A
TRBT
Capital Ownership Schedule
|
Name
|
Number of TEEKA TAN
Common to be Issued (shown as a % of total TEEKA
TAN common after closing)
|
|
1.
Mandarin Century Holdings Ltd., BVI
|
18,991,000 (54.26%)
|
|
2.
Master Power Holdings Group Ltd, BVI
|
2,100,000 (6.00%)
|
|
3. Accord
Success Ltd., BVI
|
3,150,000 (9.00%)
|
|
4.
Kind Achieve Group, BVI
|
259,000 (0.74%)
|
|
5.
All Possible Group Ltd., BVI
|
4,025,000 (11.50%)
|
|
6.
Grand Opus Co. Ltd., BVI
|
1,575,000 (4.50%)
|
|
7.
Eastco United Limited, BVI
|
1,400,000 (4.00%)
|
|
TOTAL
|
31,500,000
(90%)
|
SCHEDULE
A.1
PERSONS
ENTITLED TO 1,400,000 WARRANTS
27
SCHEDULE
B
TRBT
ASSETS AND LIABILITIES (FINANCIAL STMTS)
28
SCHEDULE
C
COMPENSATION
OF TKAT INCOMING OFFICERS AND DIRECTORS
29
SCHEDULE
D(1)
TEEKA
TAN PRODUCTS, INC. ARTICLES AND BYLAWS
30
SCHEDULE
D(2)
TEEKA
TAN PRODUCTS, INC. SUBSIDIARIES
______________
31
SCHEDULE
E
TEEKA
TAN PRODUCTS, INC.
FINANCIAL
STATEMENTS
32
SCHEDULE
E
TEEKA
TAN PRODUCTS, INC.
LITIGATION
33