Dated the 26th day of October 2009.
THIS AGREEMENT is made on the 26th day of October 2009
BETWEEN
(1)
▇▇▇▇▇, ▇▇▇▇-▇▇▇ ▇▇▇▇▇▇▇, holder of [identity card number xxxxx] of [address] (the
"Seller");and
(2)
Simple Earth, Inc., a corporation established under ·the laws of USA whose registered
office is situated at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Purchaser"). WHEREAS:
(A)
As at the date of this Agreement, the Seller is the owner of the Sale Shares, representing
100 per cent of the issued share capital of the Company.
(B) The Seller has agreed to sell to the Purchaser and the Purchaser has agreed to purchase from the Seller the Sale Shares for the consideration and otherwise upon and subject to the terms and conditions of this Agreement (the "Acquisition").
IT IS HEREBY AGREED as follows:
1.
DEFINITIONS AND INTERPRETATION
(A) In this Agreement (including the Recitals) the following expressions shall (unless the context otherwise requires) have the following meanings:
"Business" means the business of marketing, distribution or sale of bagasse-based paper products, which business has been conducted throughout the United States of America, Canada and Europe;
"Business Day'' means a day (other than a Saturday or Sunday) on which commercial banks in the USA are open for the transaction of general banking business by members of the public;
"Company" means SugarMade, Inc., a California corporation with a principal place of business located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇;
"Completion" means performance by the Seller and the Purchaser of their respective obligations under Clause 4;
"Completion Date" means the date of Completion as referred to in Clause 4{A);
-"Covenants" means the covenants set out in Clause 6;
"Convertible Promissory Notes" means those certain convertible promissory notes issued in a series and executed as at the date of Completion (or reasonably thereafter) by the Purchaser in favour of ▇▇▇▇▇▇▇ ▇▇▇▇▇ and certain other investors in the aggregate principal amount of five hundred forty thousand dollars ($540,000), the form of which is attached as Exhibit 3 hereto. For purposes of this Agreement, each such convertible promissory note shall .be defined as a "Convertible Note” and together, the "Convertible Promissory Notes".
"US$" means USA dollars;
"USA" means the United States of America;
"Sale Shares" means the Shares, representing 100 per cent of the issued and outstanding share capital of the common stock of the Company as at the date of this Agreement;
"Shares" means ordinary shares of capital of the Company and "Share" shall be construed accordingly;
"Stock Consideration" means collectively the 72,973 shares, representing 10 percent of the issued and outstanding capital stock of the Purchaser as at the date of this Agreement;
"Stock Option Plan" means the Company's 2009 Stock Option/Stock Issuance Plan pursuant to which 150,000 shares of the Company's Common Stock have been reserved for future issuance to the Company's employees, contractors and advisors, and pursuant to which no options have been granted or shares issued as of the Completion Date;
"Warranties" means the representations and warranties set out in Clause 5.
(B)
In this Agreement, unless the context otherwise requires, any reference to:
(i) a Clause, Recital or Exhibit is to a clause of or a recital or exhibit to this Agreement, as the case may be, and a reference to this Agreement includes each Exhibit;
(ii) “writing", or any cognate expression, includes a reference to any communication effected by telex, facsimile transmission, email correspondence or similar means; and
(iii) a document "in the agreed form" is a reference to the form of the relevant document agreed between the parties and initialed by them for the purpose of identification.
(C)
The headings in this Agreement are for convenience only and shall not affect the
construction of this Agreement.
2.
CONDITION PRECEDENT
(A)
Completion shall be conditional upon the following:
(i) the ▇▇▇▇ of Sale in the form attached hereto as Exhibit I is subsisting and valid as of the Completion Date;
(ii) the Exclusive Supplier Agreement in the form attached hereto as Exhibit 2 is subsisting and valid as at the Completion Date;
(iii)
there being no breach of the Warranties at any time up to (and including) the
Completion Date;
(iv) termination of that certain letter agreement dated May 1, 2009, by and among The MarketSource Companies, Sugar Cane paper Company-Hong Kong and Suagar Cane Paper Company-Asia Ltd, a copy of which is attached hereto as Exhibit 5.
(B) If the conditions precedent referred to in Clause 2(A) shall not have been fulfilled (or waived by the Seller or the Purchaser, as the case may be) by the Completion Date, this Agreement shall become null and void ad initio and no Party shall have any liability or obligation to any other Party howsoever or whatsoever, save in respect of any failure to use best endeavors as aforesaid.
3.
SALE AND P'URCHASE OF THE SALE SHARES
(A) The Seller shall sell free from all encumbrances and together with all rights attached thereto as at the date of this Agreement (and all rights hereafter becoming attached or accruing thereto) and the Purchaser shall purchase the Sale Shares with effect from Completion in accordance with the terms and conditions of this Agreement together with all rights, charges, adverse claims and interests past, now and hereafter attached hereto.
(B)
The consideration for the Sale Shares shall comprise of the following:
(i)
an aggregate sw11 of 'US$400,000.00 which shall be paid by the Purchaser to the
Seller on Completion in accordance with the provisions of Clause 4(A)(vii & viii).
(ii)
the Stock Consideration which shall be paid by the Purchaser to the Seller on
Completion in accordance with the provisions of Clause 4(A)(ix).
(C)
Any stamp duty payable on the sale and purchase of the Sale Shares shall be borne by the
Seller and the Purchaser in equal shares.
4.
COMPLETION
(A)
Subject to the terms and conditions of this Agreement, Completion shall take place at the
offices of Niesar & ▇▇▇▇▇ LLP, 90 New ▇▇▇▇▇▇▇▇▇▇ Street, 9
Floor, ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ on October 26, 2009 or such other place or date as the Parties hereto may mutually agree in writing, when, except as indicated below, all but not part only of the business referred to below shall be transacted:
(i) the Purchaser shall deliver to the Seller a copy of the certificate of incorporation and the by-laws (or other constitutional documents) of the Purchaser and minutes of a meeting of the board of directors or other governing body of the Purchaser approving the execution of this Agreement and issuance of the Stock Consideration by the Purchaser and the performance of the Purchaser's obligations under this Agreement certified as true, complete and correct copies by a director or the secretary of the Purchaser;
(ii) the Seller shall deliver to the Purchaser a transfer of the Sale Shares, in the agreed form, duly executed in favour of the Purchaser together with the share certificates in respect of the Sale Shares;
(iii) the Seller shall cause a board meeting of the Company to be held at which the Seller shall resign as director of the Company with effect from the later of the date of Completion. Alternatively, such action may be taken by execution of a letter of resignation of the sole director of the Company, with effect from the later of the date of Completion;
(iv) the Seller shall cause a board meeting of the Company to be held at which the transfer of the Sale Shares shall, subject to the relevant Instrument of Transfer being duly stamped be passed for registration and registered and the Company shall issue and deliver to the Purchaser a new share certificate representing the Sale Shares. Alternatively, such action may be taken by execution of an action by written consent of the sole director of the Company;
(v) the Seller shall deliver to the Purchaser the written resignation as director of the
Company in the agreed form of the directors referred to in (iii) above;
(vi) the statutory books, books of account, title deeds, all insurance policies and receipts and other records and contracts and licenses and other documents, chops, seals and cheque books and other items belonging or relating to the Company as may be requested by the Purchaser and which are in the possession and control of the Seller;
(vii)
the Purchaser shall pay to the Seller (or as the Seller may direct by written notice) US$300,000.00 in cash in immediately available funds in part payment and
consideration for the sale and purchase of the Sale Shares, by electronic transfer to such bank account(s) as may be notified by the Seller to the Purchaser in writing not less than 3 Business Days before the Completion Date (and if more than one such bank account is so notified, in such proportions as the Seller may specify in such notification) or by way of a bank draft issued by a licensed bank in USA;
(viii)
the Purchaser shall issue and deliver a promissory note in the sum of US$60,000.00
in favour of the Seller payable on the 30th day of June 2010;
(ix) the Purchaser shall issue and deliver to the Seller share certificate, representing the Stock Consideration, issued and fully paid and duly registered in the name of the Seller;
(x) the Seller shall pay to the Purchaser in cash in immediately available funds by electronic transfer to such bank account(s) as may be notified by the Purchaser to the Seller in writing not less than 3 Business Days before the Completion Date or by way of a bank draft drawn on a licensed bank in USA in favour of the Government of USA an amount representing any stamp duty payable by the Seller pursuant to Clause 3(C);
(xi) ▇▇▇▇▇▇▇ ▇▇▇▇▇ shall pay to Purchaser US$15,000.00 in cash in immediately available funds by way of a bank draft issued by a licensed bank in USA;
(xii) within 30 days of the Completion Date, ▇▇▇▇▇▇▇ ▇▇▇▇▇, alone or in conjunction with other investors, shall pay to Purchaser US$185,000.00 in cash in immediately available funds by way of a bank draft issued by a licensed bank in USA;
(xiii) within 5 days of Purchaser's receipt of the funds described in Section 4(A)(xii) above, Purchaser shall pay to Seller US$40,000.00 in cash in immediately available funds by way of a bank draft issued by a licensed bank in USA;
(xiv) the Seller shall transfer and assign all of Seller's right t title and interest in and to the ▇▇▇▇ "Sugar Made", Serial Number 77625286, to Purchaser, including, without limitation, the filing of an assignment of such ▇▇▇▇ from the Seller to Purchaser within a reasonable time after the Completion Date, but in no event later than 15 days following the Completion Date.
(13)
If the Seller (on the one hand) or the Purchaser or the Purchaser on the other hand shall fail or be unable to comply with any of their respective obligations under Clause 4(A) despite the Completion becoming unconditional in accordance with the provisions hereof, then the Purchaser (in the case of any such noncompliance by the Seller) or the Seller (in the case of any such non-compliance by the Purchaser) shall not be obliged to perform any of their respective obligations under Clause 4(A) and shall be entitled (in addition to and without prejudice to any other rights or remedies available to it) to rescind this Agreement whereupon this Agreement shall be rescinded and shall cease to have effect. Witl1out
prejudice to the generality of the foregoing, the Purchaser shall not be required to complete the purchase of any of the Sale Shares unless the purchase of all of the Sale Shares is completed simultaneously. Save as aforesaid, neither the Seller or the Purchaser shall be entitled to rescind this Agreement, whether before or after Completion, for any reason whatsoever.
5.
THE WARRANTIES
(A)
The Seller represents and warrants to the Purchaser that:-
(i) it has full power to enter into and perform this Agreement and this Agreement constitutes its legally valid and binding obligations;
(ii) it has the full power, authority and legal right to own its assets and to carry on its business and is not in receivership or bankruptcy;
(iii) it has taken no steps to enter into bankruptcy or analogous proceedings and no petition has been presented for its winding up or similar proceedings taken and there are no grounds on which a petition or application could be based for the bankruptcy of or appointment of a receiver or the levy of distress or execution or the taking of analogous proceedings against it;
(iv) it is the sole legal and beneficial owner of the Sale Shares;
(v) save for the pre-emption and other provisions contained in the by-laws of the Company, there is no option, right to acquire, mortgage, charge, pledge, lien or other form of security or encumbrance or equity on, over or affecting the Sale Shares and there is no agreement or commitment to give or create any of the foregoing and no claim has been made by any person to be entitled to any of the foregoing; and
(vi) At the time of Completion, there shall be no liability for taxes, contract obligations or any other type of claim that may be asserted against the Company; including, without limitation, any obligation that the Company may have with respect to any income tax or Franchise tax arising out of the net taxable income of the Company from the date of the Company’s inception to the date of Completion.
(13)
The Purchaser represents and warrants to the Seller that:
(i) The Purchaser is a corporation duly organized, validly existing and in good standing w1der the laws of the USA. The Purchaser is duly authorized to conduct business and is in good standing under the laws of the USA and ahs full corporate power and authority and all licenses, permits and authorizations necessary to carry on the
businesses in which it is engaged, to own and use the properties owned and used by it and to execute, deliver and perform this Agreement. The execution and delivery of this Agreement and the consummation of the Acquisition and the issuance of the Stock Consideration and the other transactions contemplated hereby by the Purchaser have duly and validly authorized by all necessary corporate action. No other corporate acts or proceedings on the part of the Purchaser are necessary to authorize this Agreement or the transactions contemplated hereby;
(ii) This Agreement has been duly executed and delivered by the Purchaser and constitutes the legal valid and binding obligations of the Purchaser enforceable against it;
(iii) The entire-issued and outstanding capital stock of the Purchaser consists of 656,756 shares of common stock, no par value, which has been duly authorized and are validly issued and fully paid and free from encumbrances;
(iv) Save the Convertible Promissory Notes and the Stock Option Plan, there is no subscription, warrant, option, convertible security, or other right (contingent or other) to purchase or otherwise acquire equity securities of the Purchaser is authorized or outstanding and there is no commitment by the Purchaser to issue shares, subscriptions, warrants, options, convertible securities or other such rights or to distribute to holders of any of its equity securities any evidence of indebtedness and there is no written or oral agreement by the Purchaser to sell or transfer any common stocks of the Purchaser to any third person and there is no obligation (contingent or other) to purchase, redeem or otherwise acquire any of its equity security or any interest therein, or to pay any dividend or to pay any dividend or make any other distribution in respect of the common stock of the Purchaser;
(v) The shares of the common stock of the Purchaser that constitute the Stock Consideration are and/or will be duly authorized and validly issue, and as of the date of issuance shall be fully paid and free of all liens, charges, claims, encumbrance and liabilities whatsoever.
(C) The Parties represent and warrant to each other that the Warranties will be true at and fulfilled down to Completion in all respects as if they had been made or given at Completion and on the basis that a reference to the actual time of Completion were substituted for any express or implied reference to the time of this Agreement.
(D) The Parties undertake that they shall not, prior to Completion, do any act or thing or omit to do any act or thing the commission or omission of which would constitute a breach of the Warranties as if they were given at Completion or which would make any of the Warranties inaccurate or misleading if they were so given on the basis referred to in Clause
5(B).
(E) In addition to the rights of the Parties to damages or any other rights at common law in respect of any breach of the Warranties, each party agrees to fully indemnify and keep the other party fully indemnified and harmless against any loss or liability arising out of this Agreement suffered as a result of any breach of any of the Warranties of the indemnifying party, together with all costs, charges, interest, penalties and expenses incidental or relating thereto.
(F) The Parties shall be entitled to claim each other after Completion that any of the Warranties is or was untrue or misleading or has or had been breached at the date of Completion.
(G) The Parties undertake to do or procure to be done all such acts and things as may be necessary to ensure that the Warranties are true and correct in all respects as at the date of Completion, including, without limiting the generality of the foregoing, all such acts and things as may be required to perfect the title to the Sale Shares (on the part of the Seller) and to the Stock Consideration (on the part of the Purchaser) and/or to discharge any option, right to acquire, mortgage, charge, pledge, lien or other form of security or encumbrance or equity on, over or affecting the Sale Shares or any agreement or commitment to give or create any of the foregoing referred to in sub-Clause 5(A)(v) and sub-Clause 5(B)(v) respectively.
(6)
THE COVENANTS
(A) From and after the date of this Agreement through the Completion Date, except as expressly contemplated or permitted by this Agreement, the Parties shall conduct their businesses in the ordinary course of business, and use reasonable efforts to maintain and preserve its business organizations, assets, employees and advantageous business relationship;
(B) The Parties will use their best efforts to bring about the fulfillment of each of the conditions precedent to the obligations of the other ▇▇▇▇▇ to close the tra11sactions contemplated by this Agreement, and will render reasonable assistance to the other party as requested by such other party to enable it to fulfill its obligations hereunder. The Parties shall give notice to the other party, when they, respectively, have satisfied all of the conditions to the other party's obligation to close for which they, respectively, are responsible;
(C) Prior to Completion, neither the Seller, on the one hand, nor the Purchaser, the other hand, shall, without prior written consent of the other party:
(i) except in the ordinary course of business, enter into, amend or tem1inate any material contracts or agreements, including, without limitation, any agreements of employment, stock or asset sale, acquisition, merger, consolidation or other business acquisition, disposition, or combination, or make any change in any material contracts;
(ii)
amend its certificate of incorporation or by-laws;
(D) The Parties shall promptly advise the other party of any change or event having a material adverse effect on it or which it believes would or would be reasonably likely to cause or constitute a material breach of their respective representations, warranties or covenants hereunder;
(E) Prior to the date that is three (3) years after the date of this Agreement, the Seller shall not own or operate any Business in competition to that of the Purchaser or solicit its employees and/or enter into any advertising agreements with the Purchaser's competitors at any location in the United States or Europe;
(F) The Purchaser undertakes to honour the promissory note under Clause 4(A)(viii) and to pay an interest of 4 per cent per annum from the due day to the date of the final payment and agrees that the Seller may offset the same for any unfulfilled obligations, adjustments or breaches pursuant to this Agreement and undertakes that such adjustment report shall be issued to the Seller no later than 28th February 2011 along with the amount of offset to the promissory note.
(G) The Seller shall use its good faith best efforts to ensure that the terms of the Exclusive Supplier Agreement are honoured by Sugarcane Paper Co., Ltd., a Hong Kong entity, for the entire term of that Agreement;
(H) The Seller covenants with the Purchaser that the Seller shall use its good faith best efforts to cause the assets of Sugarcane Paper Co., Ltd., as described in the ▇▇▇▇ of Sale at1ached hereto as Exhibit 1, be transferred to either the Company or to Purchaser, free and clear of all claims as at the Completion Date.
(I) The Purchaser covenants with the Seller that in the event that the holders, or any of them, of the Convertible Promissory Notes exercise his, her, its or their right to convert such note(s) into shares of the common stock of the Purchaser pursuant to the terms of such Convertible Promissory Notes, then, within 7 days following such conversion, the Purchaser shall issue to Seller additional shares of the common stock of the Purchaser such that the total number of shares owned by Seller shall be equal to or not less than 10 percent of the combination of(i) the issued and outstanding capital stock of the Purchaser as at the Completion Date; and (ii) the aggregate of shares that the Purchaser issues to the holder(s) of the Convertible Promissory Note(s) following such conversion.
(J) The Purchaser covenants with the Seller that the Purchaser shall pay an earned payment in the aggregate sum of US$600,000.00, to which the Seller is entitled pursuant to the terms and conditions described in Exhibit 4 hereto, to the Seller in three equal annual payments in the fiscal year of 2010, 2011 and 2012 and within 30 days after the filing of the annual
financial statements by the Purchaser in each of the said respective fiscal years.
7.
LIMITATIONS ON CLAIMS
The Purchaser agrees that the aggregate liability of the Seller under this Agreement shall not exceed the aggregate of the amounts received by the Seller under this Agreement by way of consideration for the sale and purchase of the Sale Shares under Clause 3(B). The liability of the Seller in relation to the Warranties shall cease on the date four (4) years from the date of Completion, save as regards any alleged specific breach of which notice in writing has been given to the Seller prior to that date.
8.
CONFIDENTIALITY
The Seller shall and shall procure that its officers, employees, agents and advisors of each of them shall keep secret and confidential and not without the prior written consent of the Purchaser disclose to any party or make use of for its own purposes (otherwise than in the context of an addition to its general experience, knowledge or expertise) any of the confidential information, reports and documents received by it relating to any Group Company including, without limitation to the generality of the foregoing, all trade secrets, know-how, data, customer lists and information, business plans and forecasts, accounting and tax records and correspondence, save where disclosure is required either by reason of . law or if the relevant information comes to the public domain otherwise than by reason of the default of the Seller or officers, employees, agents or advisors of any of them.
9.
PURCHASER'S DECLARATION
The Purchaser hereby declares and confirms that it has full knowledge of and is satisfied that all the accounting, financial and trading positions, management affairs, and other affairs of the Company and the Purchaser hereby waives and abandons its rights, if any, to request the Seller to give any warranty, make any disclosure, procure any assistance or provide with any information in respect of the Company for the Purchaser to carry out any due diligence in respect of the above matters of the Company prior to Completion provided, however, that nothing in this Section 9 shall operate in derogation of Seller's warranty obligation set forth in Paragraph 5(A) and the corresponding indemnification obligations set forth in Paragraph 5(E).
10.
NATURE OF AGREEMENT
(A) This Agreement is personal to the parties and neither party may assign, mortgage, charge or sublicense any of its rights hereunder, or sub-contract or otherwise delegate any of its obligations hereunder, except with the prior written consent of the other party.
(B)
Nothing in this Agreement shall create, or be deemed to create, a partnership, or the
relationship of principal and agent, between the parties or any of them.
(C) This Agreement and documents referred to herein contains the entire agreement between the parties with respect to its subject matter (no party having relied on any representation or warranty made by any other party which is not a term of this Agreement) and may not be modified except by an instrument in writing signed by the parties and supersedes all and any previous agreements or arrangements between the parties hereto or any of them relating to the transactions contemplated hereby and all or any such previous agreements or arrangements (if any) shall cease and determine with effect from the date of execution of this Agreement.
(D) If any provision of this Agreement is held to be invalid, illegal or unenforceable, then such provision shall (so far as it is invalid, illegal or unenforceable) be given no effect and shall be deemed not to be included in this Agreement but without invalidating any of the remaining provisions of this Agreement. The parties shall nevertheless negotiate in good faith in order to agree the terms of a mutually satisfactory provision, achieving so nearly as possible the same commercial effect, to be substituted for the provision so found to be invalid, illegal or unenforceable.
(E) No failure or delay by any party in exercising any of its rights under this Agreement shall be deemed to be a waiver thereof nor shall a waiver of a breach of any provision of this Agreement be deemed to be a waiver of any subsequent breach of the same or any other provision.
(F)
Time shall be of the essence in this Agreement.
11.
NOTICES AND SERVICE
(A) Any notice or other communication required to be given under this Agreement shall be deemed duly served if left at or sent by registered or recorded delivery post, facsimile transmission or email correspondence to the addresses, the fax numbers or email addresses set out in Clause 11(B) or to such other address, fax number or email address as may have been last notified in writing by or on behalf of the relevant party to the other parties hereto. Any such notice shall be deemed to be served at the time when the same is left at the address of the party to be served and if served by post on the second Business Day next following the day of posting. Any notice served by facsimile transmission or email correspondence shall be deemed to have been served when sent provided that !he transmission was confirmed as sent by the originating machine or computer, as applicable.
(B)
Each notice or other communication given or made hereunder shall be in writing and delivered or sent to the relevant party at its address, fax number or email address set out below (or such other address, fax number or email address as the addressee has by five Business Days' prior written notice specified to the other parties):-
To the Seller
Name Address Attention Fax Number
Email Address
▇▇▇▇▇, ▇▇▇▇-▇▇▇ ▇▇▇▇▇▇▇
________________________
______________________
▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
To the Purchaser
Name Address Attention Fax Number
Email Address
Simple Earth Inc.
▇▇ ▇▇▇▇▇ ▇▇., ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Chief Executive Officer
____________________
▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy to (which shall not constitute notice):
Name
Address
▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇
Attention Fax Number Email Address
12.
MISCELLANEOUS
94114
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
415.882.5400
▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇; ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
(A) This Agreement may be signed or executed in one or more parts and where signed or executed in more than one part each part shall be deemed to constitute an integral part of the one Agreement.
(B) Each of the Parties shall pay its own costs, charges and expenses incurred in connection with the negotiation, preparation and implementation of tins Agreement.
13.
PROPER LAW AND JURISDICTION
This Agreement shall be governed by and construed and enforced in accordance with Inc. laws of the State of California, without reference to conflicts of laws rules. The federal and
state courts located within San Francisco, California shall have exclusive jurisdiction to adjudicate any dispute arising out of-this Agreement.
AS WITNESS whereof this Agreement is entered into the day and year first above written.
SIGNED by
the Seller
) /s/ ▇▇▇▇▇, ▇▇▇▇-▇▇▇ ▇▇▇▇▇▇▇
)
)
in the presence of:-
)
SIGNED by Ethan ▇▇▇▇▇ ▇▇▇▇▇▇
) /s/ Ethan ▇▇▇▇▇ ▇▇▇▇▇▇
)
for and on behalf of the Purchaser
)
)
in the presence of:-
)
▇▇▇▇ of Sale
Exclusive Supplier Agreement
Form of Convertible Promissory Note
Earned Payment Criteria
In each of the three fiscal years commencing after the Completion Date upon the Purchaser achieving (a) an net income of US$9Million, US$10Million and US$11Million in the fiscal year 2010, 2011 and 2012 respectively; and (b) an average gross profit margin of not less than 6 per cent; and such earned payment shall be due for payment 30 days after the filing of the annual financial statements by the Purchaser in the each of the respective fiscal year;
MarketSource Companies Letter Agreement
May 1,2009
Letter of Agreement
This agreement is between The MarketSource Companies (TMS) located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and Sugar Cane Paper Company-Hong Kong (SCPC-HK) and Sugar Cane Paper Company-Asia Ltd. (SCPC-A), located l6B, ▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇.
Whereas The Sugar Cane Paper Company-Hong Kong is the parent company and administrative arm of
The Sugar Cane Paper Company's administrative operations.
Whereas The Sugar Cane Paper Company-Asia is a wholly owned subsidiary of The Sugar Cane Paper
Company-HK and is the manufacturing entity of SCPC-HK , manufacturing it's bagasse paper products in
Taishan, China and California.
Whereas 1l1e MarketSource Company (TMS) or it's associated entity, MarketSource Paper Company (MSPC) is a sales, marketing, and distribution company, exclusively representing and distributing bagasse based product for SCPC-HK and/or SCPC-A.
Effective immediately, The MarketSource Companies is the exclusive distributor and agent of SCPC-HK and SCPC-A for all bagasse-based products, specifically copy paper for all market channels in North America, Central America and Europe (US based companies).
Disagreement will be contingent on the ability for TMS to deliver a viable customer of bagasse-based product (copy paper) that can purchase a significant available amount of production capacity of 8.5 x 11" and/or A4 size bagasse based copy paper by the end of 2009, based on production capacity of 11 metric tons of US size and 21 MT of A4 size.
Price
Base price:
$2.60 per ▇▇▇▇, FOB Shenzhen, China.
Price guarantee:
Not to exceed 5% year, with a 3 month notice in writing.
Capacity Guarantee (11st year - 2009)
Size | Composition | Capacity (annual rate) | |
8.5" X II" (US) | 100% re-cycled, 70% bagasse 30% bamboo | 11K metric tons | |
A4 | 100% re-cycled,70% bagasse, 30% bamboo | 21 K metric tons | |
8.5" X I 1" (US-SF) | 100% recycled | d 70% bagasse, 30% bamboo | IOK metric tons |
Other necessary requirements will be a mutual right to examine any agreements, contracts or commitments to associated parties that are in place, or future agreements, contracts or commitments that may be agreed to between associated parties, customers, factory etc., for example, SCPC-HK and Guangdong Paper Company (factory), TMS/Customer- or other Contracts.
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Chief Executive Officer
Sugar Cane Paper Company USA
Sugar Cane Paper Company Asia
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Chief Executive Officer
The Market Source Companies
MarketSource Paper Company