SHARE EXCHANGE AGREEMENT By and Among SINO-BIOTICS, INC., and CH INTERNATIONAL HOLDINGS LIMITED, and KEG INTERNATIONAL LIMITED Dated as of July 16, 2008
By
and
Among
SINO-BIOTICS,
INC.,
and
CH
INTERNATIONAL HOLDINGS LIMITED,
and
KEG
INTERNATIONAL LIMITED
Dated
as
of July 16, 2008
TABLE
OF CONTENTS
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PAGE
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ARTICLE
I REPRESENTATIONS, COVENANTS, AND WARRANTIES OF CH
INTERNATIONAL
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3
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Section
1.01
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Organization
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4
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|
Section
1.02
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Capitalization
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4
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|
Section
1.03
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Subsidiaries
and Predecessor Corporations
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4
|
|
Section
1.04
|
Financial
Statements
|
4
|
|
Section
1.05
|
Information
|
5
|
|
Section
1.06
|
Options
or Warrants
|
5
|
|
Section
1.07
|
Absence
of Certain Changes or Events
|
5
|
|
Section
1.08
|
Contracts
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6
|
|
Section
1.09
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No
Conflict With Other Instruments
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7
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|
Section
1.10
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Compliance
With Laws and Regulations
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7
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|
Section
1.11
|
Approval
of Agreement
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7
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|
Section
1.12
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Valid
Obligation
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7
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ARTICLE
II REPRESENTATIONS, COVENANTS, AND WARRANTIES OF SINO
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7
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|
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Section
2.01
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Organization
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8
|
|
Section
2.02
|
Capitalization
|
8
|
|
Section
2.03
|
Subsidiaries
and Predecessor Corporations
|
8
|
|
Section
2.04
|
Financial
Statements
|
8
|
|
Section
2.05
|
Information
|
9
|
|
Section
2.06
|
Options
or Warrants
|
9
|
|
Section
2.07
|
Absence
of Certain Changes or Events
|
9
|
|
Section
2.08
|
Litigation
and Proceedings
|
10
|
|
Section
2.09
|
Contracts
|
10
|
|
Section
2.10
|
No
Conflict With Other Instruments
|
10
|
|
Section
2.11
|
Compliance
With Laws and Regulations
|
10
|
|
Section
2.12
|
Approval
of Agreement
|
10
|
|
Section
2.13
|
Material
Transactions or Affiliations
|
11
|
|
Section
2.14
|
Bank
Accounts; Power of Attorney
|
11
|
|
Section
2.15
|
Valid
Obligation
|
11
|
|
Section
2.16
|
Filings
|
11
|
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ARTICLE
III PLAN OF EXCHANGE
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12
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|
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Section
3.01
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The
Exchange
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12
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Section
3.02
|
Anti-Dilution
|
12
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|
Section
3.03
|
Closing
Events
|
12
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|
Section
3.04
|
Termination
|
12
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ARTICLE
IV SPECIAL COVENANTS
|
12
|
|
|
Section
4.01
|
Access
to Properties and Records
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12
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|
Section
4.02
|
Delivery
of Books and Records
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13
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|
Section
4.03
|
Third
Party Consents and Certificates
|
13
|
|
Section
4.04
|
Cancellation
of Shares Held By Principal Stockholder
|
13
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|
Section
4.05
|
Designation
of Directors and Officers
|
13
|
|
Section
4.06
|
Indemnification
|
13
|
|
Section
4.07
|
The
Acquisition of Sino Common Stock
|
14
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ARTICLE
V CONDITIONS PRECEDENT TO OBLIGATIONS OF SINO
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14
|
|
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Section
5.01
|
Accuracy
of Representations and Performance of Covenants
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15
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|
Section
5.02
|
Officer’s
Certificate
|
15
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|
Section
5.03
|
Good
Standing
|
15
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|
Section
5.04
|
Approval
by Stockholder
|
15
|
|
Section
5.05
|
No
Governmental Prohibition
|
15
|
|
Section
5.06
|
Consents
|
15
|
|
Section
5.07
|
Other
Items
|
15
|
|
ARTICLE
VI CONDITIONS PRECEDENT TO OBLIGATIONS OF CH INTERNATIONAL AND
THE
STOCKHOLDER
|
16
|
|
|
Section
6.01
|
Accuracy
of Representations and Performance of Covenants
|
16
|
|
Section
6.02
|
Officer’s
Certificate
|
16
|
|
Section
6.03
|
Good
Standing
|
16
|
|
Section
6.04
|
No
Governmental Prohibition
|
16
|
|
Section
6.05
|
Consents
|
16
|
|
Section
6.06
|
Legal
Opinion
|
16
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| ARTICLE VII MISCELLANEOUS |
17
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|
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Section
7.01
|
Brokers
|
17
|
|
Section
7.02
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Governing
Law
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17
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Section
7.03
|
Notices
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17
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|
Section
7.04
|
Attorney’s
Fees
|
18
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|
Section
7.05
|
Confidentiality
|
18
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|
Section
7.06
|
Public
Announcements and Filings
|
19
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|
Section
7.07
|
Entire
Agreement
|
19
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|
Section
7.08
|
Recitals
|
19
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|
Section
7.09
|
Third
Party Beneficiaries
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19
|
|
Section
7.10
|
Expenses
|
19
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|
Section
7.11
|
Survival;
Termination
|
19
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|
Section
7.12
|
Counterparts
|
19
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|
Section
7.13
|
Amendment
or Waiver
|
19
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|
Section
7.14
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Best
Efforts
|
20
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Section
7.15
|
Entire
Agreement
|
20
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CH
INTERNATIONAL SCHEDULES
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23
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SINO
SCHEDULES
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24
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EXHIBIT
A
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A-1
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EXHIBIT
B
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B-1
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2
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THIS
SHARE EXCHANGE AGREEMENT
(this
“Agreement”)
is
entered into as of this 16th day
of
July 2008, by and among SINO-BIOTICS,
INC., a
Delaware corporation (“Sino”),
CH
INTERNATIONAL HOLDINGS LIMITED,
a
British Virgin Islands investment holding company (“CH
International”)
and
KEG
INTERNATIONAL LIMITED,
a
British Virgin Islands company (the “Stockholder”),
upon
the following premises:
RECITALS:
WHEREAS,
Sino is
a U.S. publicly held corporation with no significant operations;
and
WHEREAS,
CH
International is a wholly-owned subsidiary of the Stockholder; and
WHEREAS,
the
Stockholder owns one hundred percent (100%) of the issued and outstanding
shares
of capital stock of CH International (the “CH
International Shares”);
and
WHEREAS,
Sino
desires to acquire the CH International Shares in exchange for the issuance
by
Sino to the Stockholder of Ninety-Three Million (93,000,000) newly-issued
shares
of Sino’s common stock, par value $0.001 per share (“Sino
Common Stock”),
on
the terms and subject to the conditions set forth herein (the “Exchange”);
and
WHEREAS,
the
parties hereto intend for this transaction to constitute a tax-free
reorganization pursuant to the provisions of Section 368(a)(1)(B) of the
Internal Revenue Code of 1986, as amended.
AGREEMENT:
NOW
THEREFORE,
on the
stated premises and for and in consideration of the mutual covenants and
agreements hereinafter set forth and the mutual benefits to the parties to
be
derived herefrom, and intending to be legally bound hereby, it is hereby
agreed
as follows:
ARTICLE
I
REPRESENTATIONS,
COVENANTS, AND WARRANTIES OF CH INTERNATIONAL
As
an
inducement to, and to obtain the reliance of Sino, except as set forth in
those
schedules prepared by CH International which are attached and made a part
hereto
(the “CH
International Schedules”),
CH
International hereby represents and warrants as of the date hereof (the
“Closing
Date”)
as
follows:
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3
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Section
1.01 Organization. CH International is a company duly organized,
validly existing, and in good standing under the laws of the British Virgin
Islands and has the corporate power and is duly authorized under all applicable
laws, regulations, ordinances and orders of public authorities to carry
on its
business in all material respects as it is now being conducted. Included
in
Item 1.01 of the CH International Schedules are complete and correct
copies of the Memorandum and Articles of Association of CH International
as in
effect on the date hereof (the “CH International Charter”). The execution
and delivery of this Agreement does not, and the consummation of the
transactions contemplated hereby will not, violate any provision of the
CH
International Charter. CH International has taken all actions required
by law,
from its CH International Charter, or otherwise to authorize the execution
and
delivery of this Agreement. CH International has full power, authority,
and
legal right and has taken all action required by law, the CH International
Charter, and otherwise to consummate the transactions herein
contemplated.
Section
1.02 Capitalization.
The
authorized capitalization of CH International consists of Fifty Thousand
(50,000) ordinary shares of capital stock, par value $1.00 per share
(“CH
International Capital Stock”).
There
are One Hundred (100) shares of CH International Capital Stock currently
issued
and outstanding. The issued and outstanding shares are legally issued, fully
paid and non-assessable and not issued in violation of the preemptive or
other
rights of any person.
Section
1.03 Subsidiaries
and Predecessor Corporations.
The
following entities are subsidiaries of CH International:
(a) Zhejiang
CH Lighting Company Limited (“CH
Lighting”),
a
wholly-owned operating entity organized under the laws of The People’s Republic
of China (“PRC”)
on
September 27, 2000;
(b) Zhejiang
CH Lighting Technology Company Limited (“CH
Technology”)
- a
wholly-owned operating entity organized under the laws of the PRC on March
31,
2003;
(c) Zhejiang
Shaoxing CH Lamps Manufacturing Company (“CH
Lamps”),
a
wholly-owned operating entity organized under the laws of the PRC on September
27, 2000;
(d) CH
Lighting (Hong Kong) (“CH
Hong Kong”),
a
company organized under the laws of Hong Kong on November 10, 2000 and
wholly-owned subsidiary of CH Lighting; and
(e) Shangyu
CH Laboratory Testing Company Limited (“CH
Labs”),
a
ninety percent (90%) owned entity organized under the laws of the PRC on
January
7, 2008.
Beyond
these entities, CH International does not have any other subsidiaries and
does
not own, beneficially or of record, any shares of any other corporation.
For
purposes hereinafter, the term “CH
International”
also
includes CH Lighting, CH Technology, CH Lamps, CH Hong Kong, and its ninety
percent (90%) ownership in CH Labs.
Section
1.04 Financial
Statements.
(a) Included
in Item
1.04(a) of the CH International Schedules
are (i)
the audited balance sheet of CH International as of September 30, 2007 and
the
related audited statements of operations, stockholders’ equity and cash flows
for the periods ended September 30, 2007 and 2006 together with the notes
to
such statements and the opinion of Mazars CPA Limited, independent certified
public accountants of CH International (the “CH
Audited Financial Statements”).
-
4
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(b) Included
in Item 1.04(b)
of the CH International Schedules
are: (i)
an unaudited balance sheet of CH International at March 31, 2008 and the
related
unaudited statements of operations, stockholders’ equity and cash flows for the
three (3) and six (6) months ended March 31, 2008; all such financial statements
have been reviewed by Mazars CPA Limited, independent certified public
accountants of CH International (together with the CH Audited Financial
Statements, the “CH
Financial Statements”).
(c) All
such
financial statements have been prepared in accordance with generally accepted
accounting principles of the United States (“GAAP”)
consistently applied throughout the periods involved. The CH International
balance sheets are true and accurate and present fairly as of their respective
dates the financial condition of CH International. As of the date of such
balance sheets, except as and to the extent reflected or reserved against
therein, CH International had no liabilities or obligations (absolute or
contingent) which should be reflected in the balance sheets or the notes
thereto
prepared in accordance with GAAP, and all assets reflected therein are properly
reported and present fairly the value of the assets of CH International,
in
accordance with GAAP. The statements of operations, stockholders’ equity and
cash flows reflect fairly the information required to be set forth therein
by
GAAP.
(d) CH
International has no liabilities with respect to the payment of any federal,
state, county, local or other domestic or foreign taxes (including any
deficiencies, interest or penalties), except for taxes accrued but not yet
due
and payable (if any).
(e) CH
International has timely filed all state, federal or local income and/or
franchise tax returns required to be filed by it from inception to the date
hereof. Each of such income tax returns reflects the taxes due for the period
covered thereby, except for amounts which, in the aggregate, are
immaterial.
(f) All
of CH
International’s assets are reflected in the CH Financial Statements, and, except
as set forth in the CH Financial Statements or the notes thereto, CH
International has no material liabilities, direct or indirect, matured or
unmatured, contingent or otherwise.
Section
1.05 Information.
The
information concerning CH International set forth in this Agreement and in
the
CH International Schedules is complete and accurate in all material respects
and
does not contain any untrue statement of a material fact or omit to state
a
material fact required to make the statements made, in light of the
circumstances under which they were made, not misleading.
Section
1.06 Options
or Warrants.
Except
as set forth in the CH Financial Statements, there are no existing options,
warrants, calls, or commitments of any character relating to the authorized
and
unissued shares of capital stock of CH International.
Section
1.07 Absence
of Certain Changes or Events.
Since
March 31, 2008:
(a) there
has
not been any material adverse change in the business, operations, properties,
assets, or condition (financial or otherwise) of CH International;
-
5
-
(b) CH
International has not (i) amended the CH International Charter; (ii) declared
or
made, or agreed to declare or make, any payment of dividends or distributions
of
any assets of any kind whatsoever to stockholders or purchased or redeemed,
or
agreed to purchase or redeem, any of its capital stock; (iii) made any material
change in its method of management, operation or accounting, (iv) entered
into
any other material transaction other than sales in the ordinary course of
its
business; or (v) made any increase in or adoption of any profit sharing,
bonus,
deferred compensation, insurance, pension, retirement, or other employee
benefit
plan, payment, or arrangement made to, for, or with its officers, directors,
or
employees; and
(c) CH
International has not (i) granted or agreed to grant any options, warrants
or
other rights for its stocks, bonds or other corporate securities calling
for the
issuance thereof, (ii) borrowed or agreed to borrow any funds or incurred,
or
become subject to, any material obligation or liability (absolute or contingent)
except as disclosed herein and except liabilities incurred in the ordinary
course of business; (iii) sold or transferred, or agreed to sell or transfer,
any of its assets, properties, or rights or canceled, or agreed to cancel,
any
debts or claims; or (iv) issued, delivered, or agreed to issue or deliver
any
stock, bonds or other corporate securities including debentures (whether
authorized and unissued or held as treasury stock) except in connection with
this Agreement.
(d) Except
as
set forth in Item
1.07(d) of the CH International Schedules,
there
are no actions, suits, proceedings, or investigations pending or, to the
knowledge of CH International after reasonable investigation, threatened
by or
against CH International or affecting CH International or its properties,
at law
or in equity, before any court or other governmental agency or instrumentality,
domestic or foreign, or before any arbitrator of any kind. CH International
does
not have any knowledge of any material default on its part with respect to
any
judgment, order, injunction, decree, award, rule, or regulation of any court,
arbitrator, or governmental agency or instrumentality or of any circumstances
which, after reasonable investigation, would result in the discovery of such
a
default.
Section
1.08 Contracts.
(a) All
“material” contracts, agreements, franchises, license agreements, debt
instruments or other commitments to which CH International is a party or
by
which it or any of its assets, products, technology, or properties are bound
other than those incurred in the ordinary course of business are set forth
on
Item
1.08 of the CH International Schedules.
A
“material” contract, agreement, franchise, license agreement, debt instrument or
commitment is one which (i) will remain in effect for more than six (6) months
after the date of this Agreement or (ii) involves aggregate obligations of
at
least One Hundred Thousand Dollars ($100,000).
(b) All
contracts, agreements, franchises, license agreements, and other commitments
to
which CH International is a party or by which its properties are bound and
which
are material to the operations of CH International taken as a whole are valid
and enforceable by CH International in all respects, except as limited by
bankruptcy and insolvency laws and by other laws affecting the rights of
creditors generally.
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6
-
(c) Except
as
included or described in the CH International Schedules or reflected in the
most
recent CH International balance sheet, CH International is not a party to
any
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, (iii) agreement, contract, or indenture
relating to the borrowing of money, (iv) guaranty of any obligation; (vi)
collective bargaining agreement; or (vii) agreement with any present or former
officer or director of CH International.
Section
1.09 No
Conflict With Other Instruments.
The
execution of this Agreement and the consummation of the transactions
contemplated by this Agreement will not result in the breach of any term
or
provision of, constitute a default under, or terminate, accelerate or modify
the
terms of any indenture, mortgage, deed of trust, or other material agreement,
or
instrument to which CH International is a party or to which any of its assets,
properties or operations are subject.
Section
1.10 Compliance
With Laws and Regulations.
To the
best of its knowledge, CH International has complied with all applicable
foreign
and domestic statutes and regulations of any federal, state, provincial or
other
governmental entity or agency thereof, except to the extent that noncompliance
would not materially and adversely affect the business, operations, properties,
assets, or condition of CH International or except to the extent that
noncompliance would not result in the occurrence of any material liability
for
CH International.
Section
1.11 Approval
of Agreement.
The
Sole Director of CH International has authorized the execution and delivery
of
this Agreement by CH International and has approved this Agreement and the
transactions contemplated hereby, and will recommend to the Stockholder that
the
Exchange be accepted by the Stockholder.
Section
1.12 Valid
Obligation.
This
Agreement and all agreements and other documents executed by CH International
in
connection herewith constitute the valid and binding obligation of CH
International, enforceable in accordance with its terms, except as may be
limited by bankruptcy, insolvency, moratorium 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.
ARTICLE
II
REPRESENTATIONS,
COVENANTS, AND WARRANTIES OF SINO
As
an
inducement to, and to obtain the reliance of CH International and the
Stockholder, except as set forth in those schedules prepared by Sino which
are
attached and made a part hereto (the “Sino
Schedules”),
Sino
represents and warrants, as of the date hereof and as of the Closing Date,
as
follows:
-
7
-
Section
2.01 Organization.
Sino is
a corporation duly organized, validly existing, and in good standing under
the
laws of the State of Delaware and has the corporate power and is duly authorized
under all applicable laws, regulations, ordinances, and orders of public
authorities to carry on its business in all material respects as it is now
being
conducted. Set forth in Item
2.01 of the Sino Schedules
are
complete and correct copies of the Certificate of Incorporation (as amended)
and
Bylaws of Sino as in effect on the Closing Date. The execution and delivery
of
this Agreement does not, and the consummation of the transactions contemplated
hereby will not, violate any provision of Sino’s Certificate of Incorporation
(as amended) or Bylaws. Sino has taken all action required by law, its
Certificate of Incorporation (as amended), its Bylaws, or otherwise to authorize
the execution and delivery of this Agreement, and Sino has full power,
authority, and legal right and has taken all action required by law, its
Certificate of Incorporation (as amended), Bylaws, or otherwise to consummate
the transactions herein contemplated.
Section
2.02 Capitalization.
Sino’s
authorized capitalization consists of (a) Five Hundred Million (500,000,000)
shares of Sino Common Stock, of which 29,180,616
shares
are issued and outstanding on the date immediately preceding the Closing
Date
and (b) Five Million (5,000,000) shares of preferred stock designated, none
of
which are issued or outstanding on the Closing Date. All issued and outstanding
shares of Sino Common Stock are legally issued, fully paid, and non-assessable
and not issued in violation of the preemptive or other rights of any
person.
Section
2.03 Subsidiaries
and Predecessor Corporations.
Item
2.03 of the Sino Disclosure Schedules
sets
forth a brief description of all of Sino’s predecessors. Sino does not have any
subsidiaries and does not own, beneficially or of record, any shares of any
other corporation.
Section
2.04 Financial
Statements.
(a) Set
forth
in Item
2.04(a) of the Sino Schedules
are (i)
the audited balance sheets of Sino as of September 30, 2008 and the related
audited statements of operations, stockholders’ equity and cash flows for the
year ended September 30, 2008 together with the notes to such statements
and the
opinion of Xxxxxx
& Xxxxxx, PC,
independent certified public accountants of Sino with respect
thereto.
(b) Set
forth
in Item
2.04(b) of Sino Schedules
are: (i)
an unaudited balance sheet of Sino at March 31, 2008 and the related unaudited
statements of operations, stockholders’ equity and cash flows for the three (3)
and six (6) months ended March 31, 2008 and all such financial statements
have
been reviewed by Xxxxxx
& Xxxxxx, PC,
independent certified public accountants with respect thereto.
(c) All
such
financial statements have been prepared in accordance with GAAP consistently
applied throughout the periods involved. The Sino balance sheets are true
and
accurate and present fairly as of their respective dates the financial condition
of Sino. As of the date of such balance sheets, except as and to the extent
reflected or reserved against therein, Sino had no liabilities or obligations
(absolute or contingent) which should be reflected in the balance sheets
or the
notes thereto prepared in accordance with GAAP, and all assets reflected
therein
are properly reported and present fairly the value of the assets of Sino,
in
accordance with GAAP. The statements of operations, stockholders’ equity and
cash flows reflect fairly the information required to be set forth therein
by
GAAP.
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8
-
(d) Sino
has
no liabilities with respect to the payment of any federal, state, county,
local
or other taxes (including any deficiencies, interest or penalties), except
for
taxes accrued but not yet due and payable.
(e) Sino
has
timely filed all state, federal or local income and/or franchise tax returns
required to be filed by it from its inception to the date hereof. Each of
such
income tax returns reflects the taxes due for the period covered thereby,
except
for amounts which, in the aggregate, are immaterial.
(f) All
of
Sino’s assets are reflected on its financial statements, and, except as set
forth in the Sino Schedules or the financial statements of Sino or the notes
thereto, Sino has no material liabilities, direct or indirect, matured or
unmatured, contingent or otherwise.
(g) Sino
shall have no liabilities on the Closing Date.
Section
2.05 Information.
The
information concerning Sino set forth in this Agreement and the Sino Schedules
is complete and accurate in all material respects and does not contain any
untrue statements of a material fact or omit to state a material fact required
to make the statements made, in light of the circumstances under which they
were
made, not misleading.
Section
2.06 Options
or Warrants.
There
are no existing options, warrants, calls, or commitments of any character
relating to the authorized and unissued stock of Sino.
Section
2.07 Absence
of Certain Changes or Events.
Since
March 31, 2008:
(a) There
has
not been any material adverse change in the business, operations, properties,
assets or condition (financial or otherwise) of Sino;
(b) Sino
has
not (i) amended its Certificate of Incorporation (as amended) or Bylaws;
(ii)
declared or made, or agreed to declare or make any payment of dividends or
distributions of any assets of any kind whatsoever to stockholders or purchased
or redeemed, or agreed to purchase or redeem, any of its capital stock; (iii)
made any material change in its method of management, operation or accounting;
(iv) entered into any transactions or agreements other than in connection
with
this Agreement and the transactions contemplated herein; or (v) made any
increase in or adoption of any profit sharing, bonus, deferred compensation,
insurance, pension, retirement, or other employee benefit plan, payment,
or
arrangement, made to, for or with its officers, directors, or employees;
and
(c) Sino
has
not (i) granted or agreed to grant any options, warrants, or other rights
for
its stock, bonds, or other corporate securities calling for the issuance
thereof; (ii) borrowed or agreed to borrow any funds or incurred, or become
subject to, any material obligation or liability (absolute or contingent)
except
liabilities incurred in the ordinary course of business; (iii) sold or
transferred, or agreed to sell or transfer, any of its assets, properties,
or
rights, or canceled, or agreed to cancel, any debts or claims; or (iv) issued,
delivered or agreed to issue or deliver, any stock, bonds or other corporate
securities including debentures (whether authorized and unissued or held
as
treasury stock), except in connection with this Agreement.
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9
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Section
2.08 Litigation and Proceedings There are no actions, suits,
proceedings or investigations pending or threatened by or against Sino or
affecting Sino or its properties, at law or in equity, before any court or
other
governmental agency or instrumentality, domestic or foreign, or before any
arbitrator of any kind. Sino has no knowledge of any default on its part
with
respect to any judgment, order, writ, injunction, decree, award, rule or
regulation of any court, arbitrator, or governmental agency or instrumentality
or any circumstance which after reasonable investigation would result in
the
discovery of such default.
Section
2.09 Contracts.
Except
as set forth in Item
2.09 of the Sino Schedules:
(a) Sino
is
not a party to, and its assets, products, technology and properties are not
bound by, any contract, franchise, license agreement, agreement, debt instrument
or other commitments whether such agreement is in writing or oral.
(b) Sino
is
not a party to or bound by, and the properties of Sino are not subject to
any
contract, agreement, other commitment or instrument; any charter or other
corporate restriction; or any judgment, order, writ, injunction, decree,
or
award; and
(c) Sino
is
not a party to any 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, (iii) agreement,
contract, or indenture relating to the borrowing of money, (iv) guaranty
of any
obligation, (vi) collective bargaining agreement; or (vii) agreement with
any
present or former officer or director of Sino.
Section
2.10 No
Conflict With Other Instruments.
The
execution of this Agreement and the consummation of the transactions
contemplated by this Agreement will not result in the breach of any term
or
provision of, constitute a default under, or terminate, accelerate or modify
the
terms of, any indenture, mortgage, deed of trust, or other material agreement
or
instrument to which Sino is a party or to which any of its assets, properties
or
operations are subject.
Section
2.11 Compliance
With Laws and Regulations.
To the
best of its knowledge, Sino has complied with all applicable statutes and
regulations of any federal, state, or other applicable governmental entity
or
agency thereof. This compliance includes, but is not limited to, the filing
of
all reports to date with federal and state securities authorities.
Section
2.12 Approval
of Agreement.
The
Board of Directors of Sino has authorized the execution and delivery of this
Agreement by Sino and has approved this Agreement and the transactions
contemplated hereby.
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10
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Section
2.13 Material
Transactions or Affiliations.
There
exists no contract, agreement or arrangement between Sino and any predecessor
and any person who was at the time of such contract, agreement or arrangement
an
officer, director, or person owning of record or known by Sino to own
beneficially, five percent (5%) or more of the issued and outstanding common
stock of Sino and which is to be performed in whole or in part after the
date
hereof or was entered into not more than three (3) years prior to the Closing
Date. Neither any officer, director, nor five percent (5%) stockholder of
Sino
has, or has had since inception of Sino, any known interest, direct or indirect,
in any such transaction with Sino which was material to the business of Sino.
Sino has no commitment, whether written or oral, to lend any funds to, borrow
any money from, or enter into any other transaction with, any such affiliated
person.
Section
2.14 Bank
Accounts; Power of Attorney.
Set
forth in Item
2.14 of the Sino Schedules
is a
true and complete list of (a) all accounts with banks, money market mutual
funds
or securities or other financial institutions maintained by Sino within the
past
twelve (12) months, the account numbers thereof, and all persons authorized
to
sign or act on behalf of Sino, (b) all safe deposit boxes and other similar
custodial arrangements maintained by Sino within the past twelve (12) months,
(c) the check ledger for the last twelve (12) months and (d) the names of
all
persons holding powers of attorney from Sino or who are otherwise authorized
to
act on behalf of Sino with respect to any matter, other than its officers
and
directors, and a summary of the terms of such powers or
authorizations.
Section
2.15 Valid
Obligation.
This
Agreement and all agreements and other documents executed by Sino in connection
herewith constitute the valid and binding obligation of Sino, enforceable
in
accordance with its terms, except as may be limited by bankruptcy, insolvency,
moratorium 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.
Section
2.16 Filings.
Sino
has timely filed all reports required to be filed by it under the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”).
Section
2.17 OTCBB.
Sino’s
Common Stock is traded on the Over-The-Counter Bulletin Board (“OTCBB”)
and
the pink sheets and meets all requirements to be listed on the OTCBB and
the
pink sheets.
Section
2.18 Correspondence
with SEC.
Except
as set forth in Item
2.18 of the Sino Schedules,
Sino
has had no correspondence with the U.S. Securities & Exchange Commission
(the “SEC”)
relating to Sino’s filings with the SEC.
Section
2.19 Xxxxxxxx-Xxxxx
Certifications.
Sino
has made all certifications to the SEC required to date under Sections 302
and
906 of the Xxxxxxxx-Xxxxx Act of 2002.
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11
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ARTICLE
III
PLAN
OF EXCHANGE
Section
3.01 The
Exchange.
On the
terms and subject to the conditions set forth in this Agreement, on the Closing
Date, the Stockholder, by executing this Agreement, shall assign, transfer
and
deliver, free and clear of all liens, pledges, encumbrances, charges,
restrictions or known claims of any kind, nature, or description, the CH
International Shares, constituting all of the shares of CH International
Capital
Stock, including voting power, of CH International. In exchange for the transfer
of the CH International Shares by the Stockholder, Sino shall issue to the
Stockholder Ninety-Three Million (93,000,000) shares of Sino Common Stock,
which
such shares shall represent seventy-seven and one half percent (77.5%) of
total
number of issued and outstanding shares of Sino Common Stock upon issuance.
On
the Closing Date, the Stockholder shall surrender its certificate or
certificates representing the CH International Shares to Sino, Sino’s counsel or
Sino’s registrar or transfer agent. Upon consummation of the transaction
contemplated herein, all of the shares of CH International Capital Stock
shall
be held by Sino. Upon consummation of the transaction contemplated herein
(including, but not limited to, the cancellation of the shares set forth
in
Section 4.04 herein below), there shall be One Hundred Twenty Million
(120,000,000) shares of Sino Common Stock issued and outstanding.
Section
3.02 Anti-Dilution.
The
number of shares of Sino Common Stock issuable upon exchange pursuant to
Section
3.01 herein above shall be appropriately adjusted to take into account any
other
stock split, stock dividend, reverse stock split, recapitalization, or similar
change in the Sino Common Stock which may occur between the date of the
execution of this Agreement and the Closing Date.
Section
3.03 Closing
Events.
On the
Closing Date, Sino, CH International and the Stockholder shall execute,
acknowledge, and deliver (or shall ensure to be executed, acknowledged, and
delivered), any and all certificates, opinions, financial statements, schedules,
agreements, resolutions, rulings or other instruments required by this Agreement
to be so delivered on or prior to the Closing Date, together with such other
items as may be reasonably requested by the parties hereto and their respective
legal counsel in order to effectuate or evidence the transactions contemplated
hereby.
Section
3.04 Termination.
This
Agreement may be terminated by the Board of Directors of CH International
only
in the event that Sino or CH International do not meet the conditions precedent
set forth in Articles V and VI. If this Agreement is terminated pursuant
this
Section, this Agreement shall be of no further force or effect, and no
obligation, right or liability shall arise hereunder.
ARTICLE
IV
SPECIAL
COVENANTS
Section
4.01 Access
to Properties and Records.
Sino
and CH International will each afford to the officers and authorized
representatives of the other full access to the properties, books and records
of
Sino or CH International, as the case may be, in order that each may have
a full
opportunity to make such reasonable investigation as it shall desire to make
of
the affairs of the other, and each will furnish the other with such additional
financial and operating data and other information as to the business and
properties of Sino or CH International, as the case may be, as the other
shall
from time to time reasonably request. Without limiting the foregoing, as
soon as
practicable after the end of each fiscal quarter (and in any event through
the
last fiscal quarter prior to the Closing Date), each party shall provide
the
other with quarterly internally prepared and unaudited financial
statements.
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12
-
Section
4.02 Delivery
of Books and Records.
On or
prior to the Closing Date, CH International shall deliver to Sino the originals
of the corporate minute books, books of account, contracts, records, and
all
other books or documents of CH International now in the possession of CH
International or its representatives. Sino shall deliver to CH International
the
originals of the corporate minute books, books of account, contracts, records,
and all other books or documents of Sino now in the possession of Sino or
its
representatives.
Section
4.03 Third
Party Consents and Certificates.
Sino
and CH International hereby agree to cooperate with each other in order to
obtain any required third party consents to this Agreement and the transactions
herein contemplated.
Section
4.04 Cancellation
of Shares Held By Principal Stockholder.
Concurrent and simultaneous with the consummation of this Agreement on the
Closing Date, Venture Fund I, Inc., Sino’s principal stockholder (the
“Principal
Stockholder”)
shall
cancel 2,180,616 shares of Sino Common Stock held by the Principal Stockholder.
Section
4.05 Designation
of Directors and Officers.
On the
Closing Date, (a) Zhao
Guosong shall
be
appointed to serve as a director of Sino, (b) Xxxxx Xxxxxx shall resign as
President, Chief Executive Officer, Chief Operations Officer, Treasurer,
and
Secretary of Sino (which shall constitute resignation from all of his positions
as an officer of Sino), (c) Zhao Guosong shall be appointed to serve as
President and Chief Executive Officer of Sino and (d) Xxxxx Xxxxx-I
shall be appointed to serve as Chief Financial Officer of Sino. After compliance
by Sino with Rule 14F-1 promulgated under the Exchange Act, Xx. Xxxxxx’x
resignation as a director shall become effective and Gan Caiying, along with
Xxx
Xxxxx, Ge
Minhai, He Wei, Man Yun and Lu
Guangming
shall be
appointed to serve as directors of Sino, with Zhao Guosong serving as Chairman
of the Board and Gan Caiying serving as Vice Chairman of the Board. Sino
shall
draft all necessary instruments to effect the appointments described in this
Section 4.05.
Section
4.06 Indemnification.
(a)
CH
International hereby agrees to indemnify Sino and each of the officers, agents
and directors of Sino as of the date of execution of this Agreement against
any
loss, liability, claim, damage, or expense (including, but not limited to,
any
and all expense whatsoever reasonably incurred in investigating, preparing,
or
defending against any litigation, commenced or threatened, or any claim
whatsoever) (“Loss”),
to
which it or they may become subject arising out of or based on any inaccuracy
appearing in or misrepresentations made under Article I of this Agreement.
The
indemnification provided for in this paragraph shall survive the closing
hereunder and the consummation of the transactions contemplated hereby and
termination of this Agreement for two (2) years following the Closing
Date.
(b)
Sino
hereby agrees to indemnify CH International and each of the officers, agents,
and directors of CH International and the Stockholder as of the date of
execution of this Agreement against any Loss to which it or they may become
subject arising out of or based on any inaccuracy appearing in or
misrepresentation made under Article II of this Agreement. The indemnification
provided for in this paragraph shall survive the Closing hereunder and the
consummation of the transactions contemplated hereby and termination of this
Agreement for one (1) year following the Closing Date.
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13
-
Section
4.07 The
Acquisition of Sino Common Stock.
Sino
and CH International acknowledge and agree that the consummation of this
Agreement including the issuance of the Sino Common Stock to the Stockholder
in
exchange for the CH International Common Stock as contemplated hereby
constitutes the offer and sale of securities under the Securities Act of
1933,
as amended (the “Securities
Act”)
and
applicable state statutes. Sino and CH International agree that such
transactions shall be consummated in reliance on exemptions from the
registration and prospectus delivery requirements of such statutes, which
depend, among other items, on the circumstances under which such securities
are
acquired.
(a) In
order
to provide documentation for reliance upon the exemptions from the registration
and prospectus delivery requirements for such transactions, the Stockholder
shall execute and deliver to Sino the Investment Representation Letter in
substantially the form of Exhibit
A
attached
hereto.
(b) In
connection with the transactions contemplated by this Agreement, Sino and
CH
International shall each file, with the assistance of the other and their
respective legal counsel, such notices, applications, reports, or other
instruments as may be deemed by them to be necessary or appropriate in an
effort
to document reliance on such exemptions, and the appropriate regulatory
authority in the States where the Stockholder is domiciled or is otherwise
required to file such notices, applications, reports or other instruments
unless
an exemption requiring no filing is available in such jurisdictions, all
to the
extent and in the manner as may be deemed by such parties to be
appropriate.
(c) In
order
to more fully document reliance on the exemptions as provided herein, CH
International, the Stockholder, and Sino shall execute and deliver to the
other,
at or prior to the Closing Date, such further letters of representation,
acknowledgment, suitability, or the like as CH International, the Stockholder
or
Sino and their respective counsel may reasonably request in connection with
reliance on exemptions from registration under such securities
laws.
(d) The
Stockholder acknowledges that the basis for relying on exemptions from
registration or qualifications are factual, depending on the conduct of the
various parties, and that a legal opinion will be provided to the effect
that
the transactions contemplated hereby are in fact exempt from registration
or
qualification.
ARTICLE
V
CONDITIONS
PRECEDENT TO OBLIGATIONS OF SINO
The
obligations of Sino under this Agreement are subject to the satisfaction,
on or
before the Closing Date, of the following conditions:
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14
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Section
5.01 Accuracy
of Representations and Performance of Covenants.
The
representations and warranties made by CH International and the Stockholder
in
this Agreement were true when made and shall be true at the Closing Date
with
the same force and effect as if such representations and warranties were
made at
and as of the Closing Date (except for changes therein permitted by this
Agreement). CH International shall have performed or complied with all covenants
and conditions required by this Agreement to be performed or complied with
by CH
International prior to or on the Closing Date. Sino shall be furnished with
a
certificate, signed by a duly authorized executive officer of CH International
and dated the Closing Date, to the foregoing effect.
Section
5.02 Officer’s
Certificate.
Sino
shall have been furnished with a certificate dated the Closing Date and signed
by a duly authorized officer of CH International to the effect that no
litigation, proceeding, investigation, or inquiry is pending, or to the best
knowledge of CH International threatened, which might result in an action
to
enjoin or prevent the consummation of the transactions contemplated by this
Agreement, or, to the extent not disclosed in the CH International Schedules,
by
or against CH International, which might result in any material adverse change
in any of the assets, properties, business, or operations of CH
International.
Section
5.03 Good
Standing.
Sino
shall have received a certificate of good standing from the Registrar of
Companies in the British Virgin Islands, dated as of a date within ten (10)
business days prior to the Closing Date certifying that CH International
is in
good standing as a limited company in the British Virgin Islands.
Section
5.04 Approval
by Stockholder.
The
Exchange shall have been approved, and shares delivered in accordance with
Section 3.01, by the holders of not less than one hundred percent (100%)
of the
outstanding CH International Capital Stock, including voting power, of CH
International, unless a lesser number is agreed to by Sino.
Section
5.05 No
Governmental Prohibition.
No
order, statute, rule, regulation, executive order, injunction, stay, decree,
judgment or restraining order shall have been enacted, entered, promulgated
or
enforced by any court or governmental or regulatory authority or instrumentality
which prohibits the consummation of the transactions contemplated
hereby.
Section
5.06 Consents.
All
consents, approvals, waivers or amendments pursuant to all contracts, licenses,
permits, trademarks and other intangibles in connection with the transactions
contemplated herein, or for the continued operation of CH International after
the Closing Date on the basis as presently operated shall have been
obtained.
Section
5.07 Other
Items.
(a) Sino
shall have received a list containing the names, addresses, and number of
shares
held by each holder of capital stock in CH International as of the Closing
Date,
certified by an executive officer of CH International as being true, complete
and accurate; and
(b) Sino
shall have received such further opinions, documents, certificates or
instruments relating to the transactions contemplated hereby as Sino may
reasonably request.
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15
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ARTICLE
VI
CONDITIONS
PRECEDENT TO OBLIGATIONS OF CH INTERNATIONAL
AND
THE STOCKHOLDER
The
obligations of CH International and the Stockholder under this Agreement
are
subject to the satisfaction, at or before the Closing Date, of the following
conditions:
Section
6.01 Accuracy
of Representations and Performance of Covenants.
The
representations and warranties made by Sino in this Agreement were true when
made and shall be true as of the Closing Date (except for changes therein
permitted by this Agreement) with the same force and effect as if such
representations and warranties were made at and as of the Closing Date. Sino
shall have performed and complied with all covenants and conditions required
by
this Agreement to be performed or complied with by Sino. Prior to or on the
Closing Date, Sino shall furnish to CH International a certificate signed
by a
duly authorized officer of Sino and dated the Closing Date, to the foregoing
effect.
Section
6.02 Officer’s
Certificate.
CH
International shall have been furnished with certificates dated the Closing
Date
and signed by duly authorized executive officers of Sino, to the effect that
no
litigation, proceeding, investigation or inquiry is pending, or to the best
knowledge of Sino threatened, which might result in an action to enjoin or
prevent the consummation of the transactions contemplated by this Agreement
or,
to the extent not disclosed in the Sino Schedules, by or against Sino, which
might result in any material adverse change in any of the assets, properties
or
operations of Sino.
Section
6.03 Good
Standing.
CH
International shall have received a certificate of good standing from the
Secretary of State of Delaware or other appropriate office, dated as of a
date
within five (5) days prior to the Closing Date certifying that Sino is in
good
standing as a corporation in the State of Delaware and has filed all tax
returns
required to have been filed by it to date and has paid all taxes reported
as due
thereon.
Section
6.04 No
Governmental Prohibition.
No
order, statute, rule, regulation, executive order, injunction, stay, decree,
judgment or restraining order shall have been enacted, entered, promulgated
or
enforced by any court or governmental or regulatory authority or instrumentality
which prohibits the consummation of the transactions contemplated
hereby.
Section
6.05 Consents.
All
consents, approvals, waivers or amendments pursuant to all contracts, licenses,
permits, trademarks and other intangibles in connection with the transactions
contemplated herein, or for the continued operation of Sino after the Closing
Date on the basis as presently operated shall have been obtained.
Section
6.06 Legal
Opinion. CH
International shall have been furnished with a legal opinion from Sino’s counsel
in the form of Exhibit
B
hereto
stating, among other things, that the transactions contemplated hereby are
exempt from registration or qualification and that all presently issued and
outstanding shares of Sino Common Stock, and all shares of Sino Common Stock
which are being issued to the Stockholder pursuant to this Agreement on the
date
hereof, have been duly authorized, validly issued and are fully paid and
nonassessable and free of any preemptive or similar rights, have been issued
in
compliance with applicable securities laws and regulations.
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16
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Section
6.07 Other
Items.
CH
International shall have received further opinions, documents, certificates,
or
instruments relating to the transactions contemplated hereby as CH International
may reasonably request.
ARTICLE
VII
MISCELLANEOUS
Section
7.01 Brokers.
Sino
and CH International agree that there were no finders or brokers involved
in
bringing the parties together or who were instrumental in the negotiation,
execution or consummation of this Agreement. Sino and CH International each
agree to indemnify the other against any claim by any third person other
than
those described above for any commission, brokerage, or finder’s fee arising
from the transactions contemplated hereby based on any alleged agreement
or
understanding between the indemnifying party and such third person, whether
express or implied from the actions of the indemnifying party.
Section
7.02 Governing
Law.
This
Agreement shall be governed by, enforced, and construed under and in accordance
with the laws of the United States of America and, with respect to the matters
of State law, with the laws of the State of Delaware. Venue for all matters
shall be in Miami, Florida, without giving effect to principles of conflicts
of
law thereunder. Each of the parties (a) irrevocably consents and agrees that
any
legal or equitable action or proceedings arising under or in connection with
this Agreement shall be brought exclusively in the federal courts of the
United
States. By execution and delivery of this Agreement, each party hereto
irrevocably submits to and accepts, with respect to any such action or
proceeding, generally and unconditionally, the jurisdiction of the aforesaid
court, and irrevocably waives any and all rights such party may now or hereafter
have to object to such jurisdiction.
Section
7.03 Notices.
Any
notice or other communications required or permitted hereunder shall be in
writing and shall be sufficiently given if personally delivered to it or
sent by
telecopy, overnight courier or registered mail or certified mail, postage
prepaid, addressed as follows:
|
If
to CH International, to:
|
CH
International Holdings Limited
|
|
1419
Worldwide Industrial Centre
|
|
|
43-47
Xxxx Xxx Street
|
|
|
Fotan,
New Territories, Hong Kong
|
|
|
Attention:
Zhao Guosong
|
|
|
Telephone:
00000-00000000
|
|
|
Facsimile:
00852-35860221
|
|
|
With
copies to:
|
K&L
Gates LLP
|
|
Wachovia
Financial Center
|
|
|
000
Xxxxx Xxxxxxxx Xxxx., Xxxxx 0000
|
|
|
Xxxxx,
XX 00000
|
|
|
Attention:
Xxxxxxx X. Xxxxxx, Esq.
|
|
|
Telephone
(000) 000-0000
|
|
|
Facsimile:
(000) 000-0000
|
|
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17
-
|
KEG
International Limited
|
|
|
Xxxx
00, 0X
|
|
|
Xxx
Xxxxx Xxxxx
|
|
|
00
Xxx Xxxxx Xxxxxx
|
|
|
Xxxxxxx,
Xxxx Xxxx
|
|
|
Attention:
Zhao Guosong
|
|
|
Telephone:
00000-00000000
|
|
|
Facsimile:
00852-28450504
|
|
|
If
to Sino, to:
|
Sino-Biotics,
Inc.
|
|
000
Xxxxx Xxxxxxxxx, xxxxx 000
|
|
|
Xxxxxxxxxxxx,
XX 00000
|
|
|
Attention:
Xxxx Xxxxxxx, Esq.
|
|
|
Telephone:
(000) 000-0000
|
|
|
Facsimile:
(000) 000-0000
|
|
|
With
copies to:
|
Xxxxxxx
& Xxxxxxx, LLP
|
|
000
Xxxxx Xxxxxxxxx, xxxxx 000
|
|
|
Xxxxxxxxxxxx,
XX 00000
|
|
|
Attention:
Xxxx Xxxxxxx, Esq.
|
|
|
Telephone:
(000) 000-0000
|
|
|
Facsimile:
(000) 000-0000
|
or
such
other addresses as shall be furnished in writing by any party in the manner
for
giving notices hereunder, and any such notice or communication shall be deemed
to have been given (i) upon receipt, if personally delivered, (ii) on the day
after dispatch, if sent by overnight courier and (iii) upon dispatch, if
transmitted by facsimile or telecopy and receipt is confirmed by telephone.
Section
7.04 Attorney’s
Fees.
In the
event that either party institutes any action or suit to enforce this Agreement
or to secure relief from any default hereunder or breach hereof, the prevailing
party shall be reimbursed by the losing party for all costs, including
reasonable attorney’s fees, incurred in connection therewith and in enforcing or
collecting any judgment rendered therein.
Section
7.05 Confidentiality.
Each
party hereto agrees with the other that, unless and until the transactions
contemplated by this Agreement have been consummated, it and its representatives
will hold in strict confidence all data and information obtained with respect
to
another party or any subsidiary thereof from any representative, officer,
director or employee, or from any books or records or from personal inspection,
of such other party, and shall not use such data or information or disclose
the
same to others, except (i) to the extent such data or information is published,
is a matter of public knowledge, or is required by law to be published; or
(ii)
to the extent that such data or information must be used or disclosed in order
to consummate the transactions contemplated by this Agreement. In the event
of
the termination of this Agreement, each party shall return to the other party
all documents and other materials obtained by it or on its behalf and shall
destroy all copies, digests, work papers, abstracts or other materials relating
thereto, and each party will continue to comply with the confidentiality
provisions set forth herein.
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18
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Section
7.06 Public
Announcements and Filings.
Unless
required by applicable law or regulatory authority, none of the parties will
issue any report, statement or press release to the general public, to the
trade, to the general trade or trade press, or to any third party (other than
its advisors and representatives in connection with the transactions
contemplated hereby) or file any document, relating to this Agreement and the
transactions contemplated hereby, except as may be mutually agreed by the
parties. Copies of any such filings, public announcements or disclosures,
including any announcements or disclosures mandated by law or regulatory
authorities, shall be delivered to each party at least one (1) business day
prior to the release thereof.
Section
7.07 Entire
Agreement.
This
Agreement represents the entire agreement between the parties relating to the
subject matter thereof and supersedes all prior agreements, understandings
and
negotiations, written or oral, with respect to such subject matter.
Section
7.08 Recitals.
The
above
recitals are true and correct and are incorporated herein, in their entirety,
by
this reference.
Section
7.09 Third
Party Beneficiaries.
This
contract is strictly between Sino, the Stockholder and CH International, and,
except as specifically provided, no director, officer, stockholder (other than
the Stockholder), employee, agent, independent contractor or any other person
or
entity shall be deemed to be a third party beneficiary of this
Agreement.
Section
7.10 Expenses.
Subject
to Section 7.04 above, whether or not the Exchange is consummated, each of
Sino,
the Stockholder and CH International will bear their own respective expenses,
including legal, accounting and professional fees, incurred in connection with
the Exchange or any of the other transactions contemplated hereby; provided,
however, that upon the consummation of the Exchange, Sino will not be
responsible for the legal, accounting and other professional fees incurred
by
Sino prior to the Closing Date in connection with the Exchange or an of the
other transactions contemplated hereby.
Section
7.11 Survival;
Termination.
The
representations, warranties, and covenants of the respective parties shall
survive the Closing Date and the consummation of the transactions herein
contemplated for a period of two (2) years.
Section
7.12 Counterparts.
This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original and all of which taken together shall be but a single
instrument.
Section
7.13 Amendment
or Waiver.
Every
right and remedy provided herein shall be cumulative with every other right
and
remedy, whether conferred herein, at law, or in equity, and may be enforced
concurrently herewith, and no waiver by any party of the performance of any
obligation by the other shall be construed as a waiver of the same or any other
default then, theretofore, or thereafter occurring or existing. At any time
prior to the Closing Date, this Agreement may by amended by a writing signed
by
all parties hereto, with respect to any of the terms contained herein, and
any
term or condition of this Agreement may be waived or the time for performance
may be extended by a writing signed by the party or parties for whose benefit
the provision is intended.
-
19
-
Section
7.14 Best
Efforts.
Subject
to the terms and conditions herein provided, each party shall use its best
efforts to perform or fulfill all conditions and obligations to be performed
or
fulfilled by it under this Agreement so that the transactions contemplated
hereby shall be consummated as soon as practicable. Each party also agrees
that
it shall use its best efforts to take, or cause to be taken, all actions and
to
do, or cause to be done, all things necessary, proper or advisable under
applicable laws and regulations to consummate and make effective this Agreement
and the transactions contemplated herein.
Section
7.15 Entire
Agreement.
This
Agreement represents the entire agreement between the parties relating to the
subject matter thereof and supersedes all prior agreements, understandings
and
negotiations, written or oral, with respect to such subject matter.
[Signature
Page To Follow]
-
20
-
IN
WITNESS WHEREOF,
the
corporate parties hereto have caused this Share Exchange Agreement to be
executed by their respective officers, hereunto duly authorized, as of the
date
first-above written.
|
SINO-BIOTICS,
INC.
|
|
|
By:
|
/s/
Xxxxx Xxxxxx
|
|
Name:
Xxxxx Xxxxxx
|
|
|
Title:
Sole Officer and Director
|
|
|
CH
INTERNATIONAL HOLDINGS LIMITED
|
|
|
By:
|
/s/
Zhao Guosong
|
|
Name:
Zhao Guosong
|
|
|
Title:
Sole Officer and Director
|
|
-
21
-
The
undersigned Stockholder of CH International hereby agrees to participate in
the
Exchange on the terms set forth above. Subject to Section 7.11 above, the
undersigned hereby represents and affirms that it has read each of the
representations and warranties of CH International set out in Article I hereof
and that, to the best of its knowledge, all of such representations and
warranties are true and correct.
|
KEG
INTERNATIONAL LIMITED
|
|
|
By:
|
/s/
Zhao Guosong
|
|
Name:
Zhao Guosong
|
|
|
Title:
Sole Director
|
|
-
22
-
CH
INTERNATIONAL SCHEDULES
|
Item
1.01
|
Memorandum
and Articles of Association of CH International Holdings
Limited
|
|
Please
see Annex A attached hereto.
|
|
|
Item
1.04(a)
|
Audited
Financial Statements of CH International for the fiscal year ended
September 30, 2007
|
|
Please
see Annex B attached hereto.
|
|
|
Item
1.04(b)
|
Unaudited
Consolidated Financial Statements of CH International Holdings Limited
for
the six (6) months ended March 31, 2008
|
|
Please
see Annex C attached hereto.
|
|
|
Item
1.07(d)
|
Litigation
and Proceedings
|
On
January 12, 2008, a dispute arouse from performance of two (2) sales contracts
entered into by and between CH Technology and Shenzhen Saiyue Industrial Co.,
Ltd. (“Saiyue”)
whereby Saiyue was required to refund an advance payment of RMB141,049.80
(US$20,742) to CH Technology and to bear the legal costs in connection
therewith. Such case is now pending before the Shenzhen Futian District Court.
|
Item
1.08
|
Material
Contacts
|
|
Please
see Annex
D
attached hereto.
|
-
23
-
SINO
SCHEDULES
|
Item
2.01
|
Certificate
of Incorporation (as amended) and Bylaws
|
|
Please
see Annex E and Annex F attached hereto.
|
|
|
Item
2.03
|
Predecessor
Corporations.
|
Sino’s
predecessor, Innovative Coatings, a Georgia Corporation, ceased operations
in
June 2003. On August 1, 2003, ICC Holdings Corp. was formed as a wholly-owned
subsidiary of Innovative Coatings. Also on August 1, 2003, Instachem
Systems was formed as a wholly-owned subsidiary of ICC Holdings Corp. and ICC
Merger Corp. was formed as a wholly-owned subsidiary of Instachem Systems.
On August 11, 2003, ICC Holdings Corp. merged with its parent company,
Innovative Coatings, to change its State of incorporation from Georgia to
Oklahoma. On August 12, 2003, ICC Merger Corp. bought ICC Holdings Corp. A
new corporation with ownership unrelated to the above, Sino-Biotics, Inc.,
was
formed in Delaware on July 6, 2005. On July 18, 2005, Instachem Systems
sold ICC Merger Corp. to an individual for $500. On July 19, 2005, Sino
bought Instachem Systems. As a result of the above, the pre-existing creditors
of the original operating entity, Innovative Coatings, were spun off through
the
sale of ICC Merger in July 2005.
|
Item
2.04(a)
|
Audited
Financial Statements of Sino for the fiscal year ended September
30,
2007
|
|
Please
see Annex G attached hereto.
|
|
|
Item
2.04(b)
|
Unaudited
Consolidated Financial Statements of Sino for the three (3) and six
(6)
months ended March 31, 2008
|
|
Please
see Annex H attached hereto.
|
|
|
Item
2.09
|
Material
Contracts
|
|
None.
|
|
|
Item
2.14
|
Bank
Accounts; Powers of Attorney
|
|
None.
|
|
|
Item
2.18
|
Correspondence
with SEC
|
|
Please
see Annex
I
attached hereto.
|
-
24
-
EXHIBIT
A
FORM
OF INVESTMENT LETTER
The
Board
of Directors of Sino-Biotics, Inc.
Re: Purchase
of Shares of Common Stock of Sino-Biotics, Inc.
Gentlemen:
In
connection with the acquisition by the undersigned of Ninety-Three Million
(93,000,000) shares of common stock of Sino-Biotics, Inc., par value $0.001
per
share (the “Securities”),
the
undersigned represents that the Securities are being acquired without a view
to,
or for, resale in connection with any distribution of such Securities or any
interest therein without registration or other compliance under the Securities
Act of 1933, as amended (“Securities
Act”),
and
that the undersigned has no direct or indirect participation in any such
undertaking or in the underwriting of such an undertaking.
The
undersigned understands that the Securities have not been registered, but are
being acquired by reason of a specific exemption under the Securities Act as
well as under certain State statutes for transactions by an issuer not involving
any public offering and that any disposition of the subject Securities may,
under certain circumstances, be inconsistent with this exemption and may make
the undersigned an “underwriter” within the meaning of the Securities Act. It is
understood that the definition of an “underwriter” focuses on the concept of
“distribution” and that any subsequent disposition of the Securities can only be
effected in transactions which are not considered distributions. Generally,
the
term “distribution” is considered synonymous with “public offering” or any other
offer or sale involving general solicitation or general advertising. Under
present law, in determining whether a distribution occurs when securities are
sold into the public market, under certain circumstances one must consider
the
availability of public information regarding the issuer, a holding period for
the securities sufficient to assure that the persons desiring to sell the
securities without registration first bear the economic risk of their
investment, and a limitation on the number of securities which the stockholder
is permitted to sell and on the manner of sale, thereby reducing the potential
impact of the sale on the trading markets. These criteria are set forth
specifically in Rule 144 promulgated under the Securities Act. After six (6)
months from the date the Securities are fully paid for and the subscription
is
accepted by the issuer, all as calculated in accordance with that Rule, sales
of
the Securities in reliance on Rule 144 can only be made in limited amounts
in
accordance with the terms and conditions of that Rule. After one (1) year from
the date the Securities are fully paid for, as calculated in accordance with
that Rule, the Securities can generally be sold without meeting these conditions
provided the holder is not (and has not been for the preceding three (3) months)
an affiliate of the issuer.
A-1
Sino-Biotics,
Inc.
Page
Two
The
undersigned acknowledges that the Securities must be held and may not be sold,
transferred, or otherwise disposed of for value unless it is subsequently
registered under the Securities Act or an exemption from such registration
is
available; the issuer is under no obligation to register the Securities under
the Securities Act or under Section 12 of the Securities Exchange Act of 1934,
as amended, except as may be expressly agreed to by it in writing; if Rule
144
is available, and no assurance is given that it will be, initially only routine
sales of such Securities in limited amounts can be made in reliance on Rule
144
in accordance with the terms and conditions of that Rule; the issuer is under
no
obligation to the undersigned to make Rule 144 available, except as may be
expressly agreed to by it in writing; in the event Rule 144 is not available,
compliance with Regulation A or some other exemption may be required before
the
undersigned can sell, transfer, or otherwise dispose of such Securities without
registration under the Securities Act; the issuer’s registrar and transfer agent
will maintain a stop transfer order against the registration of transfer of
the
Securities; and the certificate representing the convertible promissory notes
and warrants composing the Securities will bear a legend in substantially the
following form so restricting the sale of such Securities.
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND ARE “RESTRICTED
SECURITIES” WITHIN THE MEANING OF RULE 144 PROMULGATED UNDER THE SECURITIES ACT.
THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR
TRANSFERRED WITHOUT COMPLYING WITH RULE 144 IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION OR OTHER COMPLIANCE UNDER THE SECURITIES ACT.
The
issuer may refuse to register transfer of the securities in the absence of
compliance with Rule 144 unless the undersigned furnishes the issuer with a
“no-action” or interpretative letter from the U.S. Securities and Exchange
Commission or an opinion of counsel reasonably acceptable to the issuer stating
that the transfer is proper; further, unless such letter or opinion states
that
the Securities are free of any restrictions under the Securities Act, the issuer
may refuse to transfer the Securities to any transferee who does not furnish
in
writing to the issuer the same representations and agree to the same conditions
with respect to such Securities as are set forth herein. The issuer may also
refuse to transfer the securities if any circumstances are present reasonably
indicating that the transferee’s representations are not accurate.
| Very truly yours, | ||
|
Dated:______________________
|
||
|
Zhao
Guosong for and on behalf of KEG
|
||
|
International
Limited
|
||
A-2
EXHIBIT
B
[FORM
OF LEGAL OPINION]
ANNEX
A
[MEMORANDUM
AND ARTICLES OF ASSOCIATION OF CH INTERNATIONAL HOLDINGS
LIMITED]
ANNEX
B
[AUDITED
FINANCIAL STATEMENTS OF CH INTERNATIONAL HOLDINGS LIMITED FOR THE FISCAL YEAR
ENDED SEPTEMBER 30, 2007]
ANNEX
C
[UNAUDITED
CONSOLIDATED FINANCIAL STATEMENTS OF CH INTERNATIONAL HOLDINGS LIMITED FOR
THE
SIX MONTHS ENDED MARCH 31, 2008]
B-1
ANNEX
E
[CERTIFICATE
OF INCORPORATION (AS AMENDED) OF SINO]
ANNEX
F
[BYLAWS
OF SINO]
ANNEX
G
[AUDITED
FINANCIAL STATEMENTS OF SINO FOR THE FISCAL YEAR ENDED SEPTEMBER 30,
2007]
ANNEX
H
[UNAUDITED
FINANCIAL STATEMENTS FOR THE THREE AND SIX MONTHS ENDED MARCH 31,
2008]
ANNEX
I
[SINO
CORRESPONDENCE WITH THE SEC]
