English Summary of Equity Transfer Agreement
Exhibit
10.1
English
Summary of
This
Equity Transfer Agreement (the “Agreement”) was executed in Jinzhou City,
Liaoning Province on June 24, 2010 by the following parties:
Between: Achieve Gain Group
Limited, a corporation duly formed under the laws of the British Virgin Islands
(hereinafter referred to as the “Seller”);
And: Friend Birch Limited, a
corporation duly formed under the laws of Hong Kong (hereinafter referred to as
the “Buyer”, and together with the Seller, “the Parties”);
WHEREAS, Vital Glee
Development Limited, a corporation duly formed under the laws of British Virgin
Islands with its legal address at P.O. Box 438, Offshore Incorporations Centre,
Road Town, Tortola, British Virgin Islands (hereinafter referred to as “the
Company”);
WHEREAS, the Seller holds 100%
equity interest of the company;
WHEREAS, the Seller hereby
agrees to sell to the Buyer, and the Buyer hereby agrees to buy from the Seller
the 100% equity interest of the Company in accordance of the terms of this
Agreement;
WHEREAS, the Seller hereby
represents that it’s the sole owner of 100% equity interest in the Company and
such equity interest is not subject to any lien, encumbrance, litigations or
deputes; and
WHEREAS, the boards of
directors of the Parties have approved the transactions contemplated by this
Agreement.
NOW, THEREFORE, the Parties,
pursuant to the principle of equality and mutual benefit and through friendly
consultations, hereby enter into this Agreement on the 24th date of June, 2010
and reach the agreements as follows:
Clause
1 Equity Interests to be Transferred, Consideration and Payment
1.1 The
Seller hereby agrees to sell to the Buyer and the Buyer hereby agrees to
purchase from the Seller the 100% equity interest of the Company.
1.2 The
Buyer hereby agrees to buy from the Seller 100% equity interest of the company,
in exchange for a total cash consideration of fifteen million U.S. Dollars
(US$15,000,000) (the “Consideration”), and the Seller hereby covenants to
achieve the target net profit of one million and six hundred thousand U.S.
Dollars (US$1,600,000) within twelve (12) months after the effectiveness of this
Agreement (from July 1, 2010 to June 30, 2011).
1.3
Payment of the Consideration:
1.3.1 The
Buyer hereby agrees to pay eight million and seven hundred thousand U.S. dollars
(US$8,700,000.00) to the designated bank account of the Seller as the first
installment of the Consideration which shall be a condition precedent for the
closing of this Agreement;
1.3.2
Before December 31, 2010, the Buyer shall pay three million one hundred and
fifty thousand U.S. dollars (US$3,150,000.00) to the designated bank account of
the Seller;
1.3.3
Before June 31, 2011, the Buyer shall pay the remaining three million one
hundred and fifty thousand U.S. dollars (US$3,150,000.00) to the designated bank
account of the Seller; In case the Company fails to achieve the profit target as
set forth in Clause 1.2 above, the Seller agrees the Consideration will be
reduced in proportion to the un-fulfilled profit.
Clause
2 Closing
2.1 The
closing date of this Agreement will be the sixth business day after satisfaction
of the condition precedent stipulated in Clause 1.3.1.
2.2 Upon
the closing of this Agreement, the Seller shall deliver or cause to deliver the
following document to the Buyer:
2.2.1
Agreement duly executed by the Seller;
2.2.2
Resignations duly executed by existing director of the Company;
2.2.3
Duly executed board resolutions of the Seller approving the closing of this
Agreement.
2.3 Upon
the closing of this Agreement, the Buyer shall deliver:
2.3.1 The
Agreement duly executed by the Buyer;
2.3.2
Duly executed board resolutions of the Buyer approving the closing of this
Agreement.
Clause
3 The Right and Responsibility Associated with the Transfer of Equity
Interest
3.1 Upon
the transfer of the 100% equity interest of the Company, the Seller shall
transfer all of its the right and responsibility associated with such equity
interest, and the Buyer will bear all responsibility as the shareholder of the
Company.
3.2 The
Buyer shall be responsible for the timely registration of the transfer of the
equity interest of the Company. The Seller shall assist the Buyer to provide all
necessary documents provide that the Buyer provides a three-day prior
notice.
3.3 Upon
the effectiveness of this Agreement, the Buyer shall own the 100% equity
interest in the Company and its associated rights and
responsibilities.
Clause
4 Distribution of Profits
4.1 The
Seller shall have right to all profits generated before June 30, 2010 that is
distributable in accordance with the applicable laws.
Clause
5 Transfer of the Equity Interest
5.1 Upon
effective of this Agreement, the Seller shall sign all the related legal
documents requested by the Buyer.
5.2 Upon
satisfaction of the section above, the Buyer shall responsible for handle the
registration and the Seller shall provide necessary assistance.
5.3 The
expenses incurred for the registration of the equity interest transfer shall be
borne by the respective Party.
5.4 The
Buyer shall timely transfer the equity interest, and bear the consequences
caused by any delay.
Clause
6 Right and Obligations
6.1 The
Seller shall transfer the 100% equity interest in the Company and shall have the
right to receive the Consideration in accordance with the terms of this
Agreement.
6.2 The
Seller shall assist the Buyer to complete the transfer of the equity interest in
the Company in accordance with this Agreement.
6.3 The
Buyer shall receive the 100% equity interest in the Company and be responsible
for handle the registration of such equity interest transfer in accordance with
this Agreement.
Clause
7 Remedies
7.1 If
one Party breaches its obligations hereunder for any reasons, such breaching
Party shall be liable for all losses suffered by the non-breaching Party as a
result thereof.
7.2 In
the event the Buyer fails to perform its obligations Under Clause 1 hereof and
such non-performance lasts fifteen (15) business days, the Seller may
unilaterally terminate the Agreement. If this Agreement is so terminated by the
Seller, the Buyer shall pay to the Seller a liquidated damage in an amount equal
to ten percent (10%) of the Consideration.
Clause
8 Dispute Resolution
8.1 All
disputes between the Parties arising out of or in connection with this Agreement
shall be settled between the Parties through friendly negotiation. If an
agreement cannot be reached between the Parties within thirty (30) days upon the
receipt of the written notice by the disputing Party, either Party may submit
the dispute to arbitration to the China International Economic and Trade
Arbitration Commission for final resolution in accordance with its arbitration
rules. The judgment of the arbitration panel shall be final and binding upon the
Parties and both Parties hereby agree to abide by such judgment of the
arbitration panel. The arbitration fees shall be borne by the losing
Party.
Clause
9 Confidentiality
9.1 The
Parties shall not disclose any confidential information received from the other
Party during the execution and performance of this Agreement to any third party
without the other Party’s consent, except for any disclosure made in compliance
with the requirement of the regulatory agencies.
Clause
10 Effectiveness Date
10.1 This
agreement will become effective on the Closing Date (July 1, 2010)
Clause
11 Force Majeure
11.1 If
performance of this Agreement in whole or in part is prevented, restricted or
interfered with by reason of an earthquake, storm, flood, fire, war, strike or
any other cause beyond the reasonable control of the Parties (each a “Force
Majeure condition”), then the affected Party shall provide the other Party with
a valid evidentiary document setting forth in detail the Force Majeure Condition
within fifteen (15) days, its expected duration and the consequences thereof.
The Parties shall thereafter consult with each other so as to avoid or minimize
any adverse effect of any Force Majeure Condition on this Agreement or the
transactions contemplated hereunder. However, if a Force Majeure condition lasts
for more than three (3) months, the Parties shall try their best to avoid or
reduce damages cause by negotiation. If the Parties cannot agree on a mutually
satisfying solution within three (3) months of such negotiation, either Party
may terminate this Agreement by giving the other Party a thirty (30) days
written notice of such termination.
Clause
12 Miscellaneous
12.1 This
agreement is written and executed in Chinese.
12.2 This
Agreement contains the entire agreement between the Parties with respect to the
transactions contemplated herein and supersedes all prior negotiations,
agreements and understandings.
12.3 In
case any one or more of the provisions of this Agreement is held invalid,
illegal or unenforceable in whole or in part, the validity, legality and
enforceability of the remaining provisions or the remaining applications shall
not be affected or impaired.
12.4 The
preamble forms an integral part of the present Agreement.
12.5 Any
notices, requests, and communications required or provided for under this
Agreement shall be in writing and shall be delivered via mail, facsimile or
express mail.
12.6 This
Agreement shall be executed in eight (8) copies. The Seller and the Buyer shall
keep one (1) copy. The remaining six (6) copies for purposes of the Share
Transfer and any required governmental filings therefore.
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The
Seller: Achieve Gain Group Limited
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Authorized
Representative:
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/s/ ▇▇▇▇▇▇ ▇▇
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The
Buyer: Friend Birch Limited
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Authorized
Representative:
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/s/ ▇▇▇▇▇▇▇▇
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