STOCK PURCHASE AGREEMENT
This
Agreement is made and entered into as of June 15, 2007, between Fine Lake
International Limited, (hereinafter referred to as "Buyer"), a company organized
under the laws of the British Virgin Islands and a wholly owned subsidiary
of
China Water and Drinks Inc., a Nevada corporation (hereinafter referred to
as
“CWD”), CWD and Xxxxx Xx (“Mr. Eng”) and Xxxxxx Xxxxx (“Xx. Xxxxx”), the
shareholders (hereinafter referred to jointly as “Sellers” and individually as a
“Seller”) of Pilpol (HK) Biological Limited, a Hong Kong company (hereinafter
referred to as “Pilpol” or the “Company”) that owns and operates Nanning Taoda
Drink Company Limited, a PRC company (“Nanning”) that is a bottled water
production company located at Nanning City (Guangxi Province) of the People’s
Republic of China .
WITNESSETH:
WHEREAS,
Xx. Xx is the owner of 70% of the issued and outstanding equity of the Company
(the “Ng Shares”), Xx. Xxxxx is the owner of 30% of the issued and outstanding
equity of the Company (the “Xxxxx Shares”) and the Sellers, together, are the
owners of 100.0% of the issued and outstanding equity (the “Shares”) of the
Company; and
WHEREAS,
each of the Sellers wishes to sell to the Buyer, and the Buyer wishes to
purchase from each of the Sellers, the Shares, upon the terms and subject to
the
conditions set forth herein;
NOW,
THEREFORE, in consideration of the premises and the mutual agreements and
covenants hereinafter set forth, the Buyer and each of the Sellers hereby agree
as follows:
ARTICLE
I
DEFINITIONS
SECTION
1.01 Certain
Defined Terms.
As used
in this Agreement, the following terms shall have the following
meanings:
“Action”
means
any claim, action, suit, arbitration, inquiry, proceeding or investigation
by or
before any Governmental Authority.
“Affiliate”
means,
with respect to any specified Person, any other Person that directly, or
indirectly through one or more intermediaries, controls, is controlled by,
or is
under common control with, such specified Person.
“Buyer”
has
the
meaning specified in the recitals to this Agreement.
“Company”
has
the
meaning specified in the recitals to this Agreement.
1
“Control”
(including the terms “controlled
by”
and
“under
common control with”),
with
respect to the relationship between or among two or more Persons, means the
possession, directly or indirectly or as trustee or executor, of the power
to
direct or cause the direction of the affairs or management of a Person, whether
through the ownership of voting securities, as trustee or executor, by contract
or otherwise, including, without limitation, the ownership, directly or
indirectly, of securities having the power to elect a majority of the board
of
directors or similar body governing the affairs of such Person.
“CWD”
has
the
meaning specified in the recitals to this Agreement.
“CWD
Common Stock”
means
the common stock, par value $0.001 per share of CWD.
“Encumbrance”
means
any security interest, pledge, mortgage, lien (including, without limitation,
environmental and tax liens), charge, encumbrance, adverse claim, preferential
arrangement or restriction of any kind, including, without limitation, any
restriction on the use, voting, transfer, receipt of income or other exercise
of
any attributes of ownership.
“GAAP”
means
generally accepted accounting principles in the United States.
“Governmental
Authority”
means
any United States federal, state or local or any foreign government,
governmental, regulatory or administrative authority, agency or commission
or
any court, tribunal, or judicial or arbitral body.
“Governmental
Order”
means
any order, writ, judgment, injunction, decree, stipulation, determination or
award entered by or with any Governmental Authority.
“Law”
means
any federal, state, local or foreign statute, law, ordinance, regulation, rule,
code, order, other requirement or rule of law.
“Xxxxx
Shares”
has
the
meaning specified in the recitals to this Agreement.
“Liabilities”
means
any and all debts, liabilities and obligations, whether accrued or fixed,
absolute or contingent, matured or un-matured or determined or determinable,
including, without limitation, those arising under any Law, Action or
Governmental Order and those arising under any contract, agreement, arrangement,
commitment or undertaking.
“Material
Adverse Effect”
means
any circumstance, change in, or effect on the business of the Company or Nanning
that, individually or in the aggregate with any other circumstances, changes
in,
or effects on, the business of the Company or Nanning: (a) is, or could be,
materially adverse to the business, operations, assets or Liabilities, employee
relationships, customer or supplier relationships, prospects, results of
operations or the condition (financial or otherwise) of the Company or Nanning
or (b) could adversely affect the ability of the Buyer or the Company or Nanning
to operate or conduct any lawful business.
2
“Xx.
Xx”
has
the
meaning specified in the recitals to this Agreement.
“Xx.
Xxxxx”
has
the
meaning specified in the recitals to this Agreement.
“Nanning”
has
the
meaning specified in the recitals to this Agreement.
“Ng
Shares”
has
the
meaning specified in the recitals to this Agreement.
“PCAOB”
means
the Public Company Accounting Oversight Board.
“Person”
means
any individual, partnership, firm, corporation, association, trust,
unincorporated organization or other entity, as well as any syndicate or group
that would be deemed to be a person under Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended.
“Purchase
Price”
has
the
meaning specified in Section 2.02.
“Registration
Rights Agreement”
means
the Registration Rights Agreement dated as of May 31, 2007 by and among CWD
and
the investors parties thereto.
“Securities
Act”
means
the Securities Act of 1933, as amended.
“Seller”
and
“Sellers”
have
the respective meanings specified in the recitals to this
Agreement.
“Shares”
has
the
meaning specified in the recitals to this Agreement.
ARTICLE
II
PURCHASE
AND SALE OF THE SHARES
SECTION
2.01 Shares
being Sold.
Subject
to the terms and conditions of this Agreement, the Sellers shall sell to the
Buyer, and the Buyer shall purchase from the Sellers, free and clear of any
Encumbrance, the Shares. Xx. Xx hereby represents and warrants to the Buyer
that
the Ng Shares constitute 70% of the Company’s outstanding equity. Xx. Xxxxx
hereby represents and warrants to the Buyer that the Xxxxx Shares constitute
30%
of the Company’s outstanding equity. The Sellers hereby represent and warrant to
the Buyer that the Shares constitute 100.0% of the Company’s outstanding
equity.
SECTION
2.02 Purchase
Price.
In
consideration for the purchase of the Shares, the Buyer shall pay to the Sellers
the lesser of (i) US$11,780,000 and (ii) four times the Company’s net income
after tax for the year ended December 31, 2006 based on the audited financials
statements of the Company for its fiscal year ended December 31, 2006 (the
“2006
Financial Statements”) as provided for in Section 2.08 hereof (the “Purchase
Price”). The Purchase Price shall consist of cash (the “Cash Consideration”) as
described in Section 2.03 hereof and stock (the “Stock Consideration”) as
described in Section 2.04 hereof. The Sellers agree that 70% of the Deposit
(as
hereinafter defined), 70% of the Cash Consideration and 70% of the Stock
Consideration shall be paid to Xx. Xx and that 30% of the Deposit, 30% of the
Cash Consideration and 30% of the Stock Consideration shall be paid to Xx.
Xxxxx.
3
SECTION
2.03 Cash
Consideration.
Within
15 days of the date hereof, Buyer shall pay the Sellers a deposit in cash equal
to US$300,000 (the “Deposit”) and within 15 business days after Buyer has been
provided with the 2006 Financial Statements, Buyer shall pay Sellers an amount
in cash equal to 50% of the Purchase Price less the Deposit.
SECTION
2.04 Stock
Consideration; Lock-up.
On the
90th
day
following the effective date of the initial registration statement to be filed
by CWD pursuant to the Registration Rights Agreement (the “Stock Consideration
Payment Date”), CWD shall issue to the Sellers and Buyer shall deliver to the
Sellers such number of shares of CWD Common Stock determined by dividing the
amount which is 50% of the Purchase Price by the average closing price of CWD
Common Stock as quoted by the Over-the-Counter Bulletin Board for the 30 days
immediately preceding the Stock Consideration Payment Date (the “Average Stock
Price”); provided that notwithstanding the foregoing, in the event that the
Average Stock Price is less than $2.00 per shares, the Stock Consideration
shall
be determined based on an Average Stock Price of $2.00 per share. Each of the
Sellers hereby agrees that such Seller hall not sell, transfer or otherwise
dispose of any of the shares of CWD Common Stock comprising the Stock
Consideration and delivered to such Seller pursuant to this Section 2.04 for
a
period of two years following the Stock Consideration Payment Date.
SECTION
2.05 Closing.
The
closing of the transactions contemplated by this Agreement (the “Closing”) shall
take place on the date of signing of this Agreement.
SECTION
2.06 Delivery
by the Sellers.
At the
Closing, the Sellers shall deliver to the Buyer certificates representing the
Shares together with appropriate executed stock powers to transfer the Shares
to
the Buyer.
SECTION
2.07 Delivery
of Cash Consideration and Stock Consideration.
The
Sellers and the Buyer agree that deliveries of the Deposit, the Stock
Consideration and the Cash Consideration shall be made to the Sellers at the
addresses provided to the Buyer by the Sellers in writing in advance of the
date
on which such payments are required to be made hereunder.
SECTION
2.08 2006
Financial Statements.
The 2006
Financial Statements of the Company shall be audited by an accounting firm
registered with PCAOB and should be in conformity with GAAP.
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ARTICLE
III
REPRESENTATIONS
AND WARRANTIES
OF
THE SELLERS
As
an
inducement to the Buyer to enter into this Agreement, each of the Sellers hereby
represents and warrants to the Buyer as follows:
SECTION
3.01 Authority
of the Sellers.
Such
Seller has full power and authority to enter into this Agreement and to perform
such Seller’s obligations hereunder and to consummate the transactions
contemplated hereby. This Agreement has been duly executed and delivered by
such
Seller and constitutes a valid and legally binding obligation of such Seller
enforceable against such Seller in accordance with its terms, except to the
extent that its enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws relating to or affecting
creditors’ rights generally and by general equitable principles.
SECTION
3.02 Title
to the Shares, etc.
Xx. Xx
has good and marketable title to the Ng Shares, free and clear of any
Encumbrance. Xx. Xxxxx has good and marketable title to the Xxxxx Shares, free
and clear of any Encumbrance. The Shares have been legally and validly issued
are fully paid and nonassessable. Except pursuant to this Agreement, Xx. Xx
has
no agreement, arrangement, or understanding with respect to the Ng Shares or
Xx.
Xx’x ownership thereof.. Except pursuant to this Agreement, Xx. Xxxxx has no
agreement, arrangement, or understanding with respect to the Xxxxx Shares or
Xx.
Xxxxx’x ownership thereof..
SECTION
3.03 No
Consents, Approvals, Violations or Breaches.
Neither
the execution and delivery of this Agreement by such Seller, nor the
consummation by such Seller of the transactions contemplated hereby, will (i)
require any consent, approval, authorization or permit of, or filing,
registration or qualification with or prior notification to any Governmental
Authority, any state or any political subdivision thereof applicable to such
Seller, the Company or Nanning , (ii) violate any statute, Law, ordinance,
rule
or regulation of any Governmental Authority, or any judgment, order, writ,
decree or injunction or other Governmental Order applicable to such Seller,
the
Company or Nanning or any of such Seller’s properties or assets, or the
properties or assets of the Company or Nanning, or (iii) violate, conflict
with,
or result in a breach of any provisions of, or constitute a default (or any
event which, with or without due notice or lapse of time, or both, would
constitute a default) under, or result in the termination of, or accelerate
the
performance required by, any of the terms, conditions or provisions of any
note,
bond, mortgage, indenture, deed of trust, license, lease, agreement or other
instrument or obligation to which such Seller, the Company or Nanning is a
party
or by which such Seller, the Company or Nanning or any of such Seller’s
properties or assets or the properties or assets of the Company or Nanning
may
be bound.
5
SECTION
3.04 Full
Disclosure.
Such
Seller is not aware of any facts pertaining to the Company or Nanning that
affect adversely the Company or Nanning or which are likely in the future to
affect the Company or Nanning adversely, except as specifically disclosed in
this Agreement. No representation or warranty of such Seller in this Agreement
or any statement or certificate furnished or to be furnished to the Buyer
pursuant to this Agreement, or in connection with the transactions contemplated
by this Agreement, including the 2006 Financial Statements contains or will
contain any untrue statement of a material fact, or omits or will omit to state
a material fact necessary to make the statements contained herein or therein
not
misleading.
SECTION
3.05 Brokers.
No
broker, finder or investment banker is entitled to any brokerage, finder's
or
other fee or commission in connection with the transactions contemplated by
this
Agreement based upon arrangements made by or on behalf of such Seller, the
Company or Nanning.
SECTION
3.06 2006
Financial Statements.
The
2006 Financial Statements of the Company to be provided hereof shall have been
prepared in accordance with GAAP applied on a consistent basis during the
periods involved, except as may be otherwise specified in such financial
statements or the notes thereto, and fairly present in all material respects
the
financial position of the Company and its consolidated subsidiaries as of and
for the dates thereof and the results of operations and cash flows for the
periods then ended.
SECTION
3.07 Compliance
with Laws.
The
Company and Nanning each are and have been in compliance in all material
respects with all Laws, regulations, rules, orders, judgments, decrees and
other
requirements and policies, including Governmental Orders imposed by any
Governmental Authority applicable to such entity, their respective properties
or
the operation of their respective businesses. Such Seller is and has been in
compliance in all material respects with all Laws, regulations, rules, orders,
judgments, decrees and other requirements and policies, including Governmental
Orders imposed by any Governmental Authority applicable to such Seller and
the
Shares owned by such Seller.
SECTION
3.08 PRC
Subsidiaries.
The
Company has no direct or indirect subsidiaries other than Nanning. The Company
owns directly, all of the equity of Nanning free and clear of any Encumbrance,
and all the issued and outstanding equity of Nanning is validly issued and
are
fully paid, non-assessable and free of preemptive and similar rights.
SECTION
3.09 Additional
Representations and Warranties Relating to Nanning.
(i) All
material consents, approvals, authorizations or licenses requisite under PRC
law
for the due and proper establishment and operation of Nanning have been duly
obtained from the relevant PRC governmental authorities and are in full force
and effect.
(ii) All
filings and registrations with the PRC governmental authorities required in
respect of each of Nanning and its operations including, without limitation,
the
registration with the Ministry of Commerce, the State Administration of Industry
and Commerce, the State Administration for Foreign Exchange, tax bureau and
customs authorities have been duly completed in accordance with the relevant
PRC
rules and regulations, except where, the failure to complete such filings and
registrations does not, and would not, individually or in the aggregate, have
a
Material Adverse Effect.
6
(iii) Nanning
has complied with all relevant PRC laws and regulations regarding the
contribution and payment of its registered share capital, the payment schedule
of which has been approved by the relevant PRC governmental authorities. There
are no outstanding rights of, or commitments made by the Company or Nanning
to
sell any equity interest in Nanning.
(iv) Neither
the Company nor Nanning is in receipt of any letter or notice from any relevant
PRC governmental authority notifying it of revocation of any licenses or
qualifications issued to it or any subsidy granted to it by any PRC governmental
authority for non-compliance with the terms thereof or with applicable PRC
laws,
or the need for compliance or remedial actions in respect of the activities
carried out by Nanning, except such revocation does not, and would not,
individually or in the aggregate, have a Material Adverse Effect.
(v) Nanning
has conducted its business activities within the permitted scope of business
or
has otherwise operated its respective business in compliance with all relevant
legal requirements and with all requisite licenses and approvals granted by
competent PRC governmental authorities other than such non-compliance that
do
not, and would not, individually or in the aggregate, have a Material Adverse
Effect. As to licenses, approvals and government grants and concessions
requisite or material for the conduct of any part of the business of any PRC
Subsidiary which is subject to periodic renewal, neither the Company nor Nanning
has any knowledge of any grounds on which such requisite renewals will not
be
granted by the relevant PRC governmental authorities.
(vi) With
regard to employment and staff or labor, Nanning has complied with all
applicable PRC laws and regulations in all material respects, including without
limitation, laws and regulations pertaining to welfare funds, social benefits,
medical benefits, insurance, retirement benefits, pensions or the like, other
than such non-compliance that do not, and would not, individually or in the
aggregate, have a Material Adverse Effect.
SECTION
3.10 Investment
Intent.
Each
Seller is acquiring the shares of CWD Common Stock included in the Stock
Consideration as principal for his or her own account for investment purposes
only and not with a view to or for distributing or reselling such shares or
any
part thereof. Neither Seller has any agreement or understanding, directly or
indirectly, with any Person to distribute any of the shares of CWD Common Stock
included in the Stock Consideration.
7
SECTION
3.11 Seller
Status.
At the
time such Seller was offered the shares of CWD Common Stock, he or she was,
at
the date hereof he or she is, and at the Stock Consideration Payment Date,
he or
she will be an “accredited investor” as defined in Rule 501(a) under the
Securities Act and a “non-U.S. person” as defined in Rule 902 of Regulation S
promulgated the Securities Act.
SECTION
3.12 Access
to Information.
Such
Seller acknowledges that he or she has been afforded (i) the opportunity to
ask
such questions as he or she has deemed necessary of, and to receive answers
from, representatives of the CWD concerning CWD and the merits and risks of
acquiring the shares of CWD Common Stock included in the Stock Consideration;
(ii) access to information about CWD and its financial condition, results of
operations, business, properties, management and prospects sufficient to enable
him or her to evaluate his or her investment; and (iii) the opportunity to
obtain such additional information that CWD possesses or can acquire without
unreasonable effort or expense that is necessary to make an informed investment
decision with respect to his or her acquisition of the shares of CWD Common
Stock included in the Stock Consideration.
SECTION
3.13 Restrictive
Legend.
Such
Seller acknowledges that certificates evidencing the shares of CWD Common Stock
included in the Stock Consideration will contain the following
legend:
THESE
SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT SECURED BY SUCH SECURITIES.
8
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES
OF
THE BUYER
AND CWD
As
an
inducement to the Sellers to enter into this Agreement, the Buyer and CWD hereby
represent and warrant to the Sellers as follows:
SECTION
4.01 Organization
and Authority of the Buyer and CWD.
The
Buyer is a company duly organized, validly existing, and in good standing under
the laws of the British Virgin Islands and has all necessary corporate power
and
authority to execute, deliver, and perform this Agreement. CWD is a corporation
duly organized, validly existing, and in good standing under the laws of the
State of Nevada and has all necessary corporate power and authority to execute,
deliver, and perform this Agreement. The Buyer is a wholly-owned subsidiary
of
CWD. The execution, delivery, and performance of this Agreement has been duly
authorized by all requisite action on the part of each of the Buyer and CWD.
This Agreement shall have been duly executed and delivered by each of the Buyer
and CWD, and (assuming due authorization, execution, and delivery by each other
party hereto) constitutes a legal, valid, and binding obligation of each of
the
Buyer and CWD, enforceable against such entity in accordance with its
terms,
except
to the extent that its enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws relating to or affecting
creditors’ rights generally and by general equitable principles.
SECTION
4.02 No
Conflict.
The
execution, delivery and performance of this Agreement by each of the Buyer
and
CWD do not and will not (a) violate, conflict with or result in the breach
of
any provision of the respective charter, bylaws, or similar organizational
documents of the Buyer and CWD, (b) conflict with or violate any Law or
Governmental Order applicable to the Buyer or CWD or require any consent,
approval, authorization, or other order of, action by, filing with, or
notification to any Governmental Authority, or (c) conflict with, or result
in
any breach of, constitute a default (or event which with the giving of notice
or
lapse or time, or both, would become a default) under, require any consent
under, or give to others any rights of termination, amendment, acceleration,
suspension, revocation, or cancellation of, or result in the creation of any
Encumbrance on any of the assets or properties of the Buyer or CWD that would
have a material adverse effect on the ability of the Buyer or CWD to consummate
the transactions contemplated by this Agreement.
SECTION
4.03 Investment
Purpose.
The
Buyer is acquiring the Shares solely for the purpose of investment and not
with
a view to, or for offer or sale in connection with, any distribution
thereof.
SECTION
4.04 Brokers.
No
broker, finder or investment banker is entitled to any brokerage, finder's
or
other fee or commission in connection with the transactions contemplated by
this
Agreement based upon arrangements made by or on behalf of the Buyer or CWD.
9
ARTICLE
V
CONDITIONS
TO CLOSING
SECTION
5.01 Conditions
to Obligations of the Sellers.
The
obligations of the Sellers to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior to the Closing,
of
each of the following conditions:
(a) Representations,
Warranties and Covenants.
The
representations and warranties of the Buyer and CWD contained in this Agreement
shall have been true and correct when made and shall be true and correct in
all
material respects as of the Closing, with the same force and effect as if made
as of the dated of the Closing and the Buyer and CWD shall each have performed
all obligations under this Agreement required to be performed by it as of the
Closing;
(b) No
Proceeding or Litigation.
No
Action. shall have been commenced by or before any Governmental Authority
against any Seller, Nanning, the Company, CWD or the Buyer, seeking to restrain
or materially and adversely alter the transactions contemplated by this
Agreement that, in the reasonable, good faith determination of the Sellers,
is
likely to render it impossible or unlawful to consummate such
transactions.
SECTION
5.02 Conditions
to Obligations of the Buyer.
The
obligations of the Buyer to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment, at or prior to the Closing,
of
each of the following conditions:
(a) Representations,
Warranties, and Covenants.
The
representations and warranties of each of the Sellers contained in this
Agreement shall have been true and correct when made and shall be true and
correct as of the Closing with the same force and effect as if made as of the
Closing and the Seller and the Company shall have performed all obligations
under this Agreement required to be performed by it as of the
Closing.
(b) No
Proceeding or Litigation.
No
Action shall have been commenced or threatened by or before any Governmental
Authority against any Seller, Nanning, the Company, CWD or the Buyer, seeking
to
restrain or materially and adversely alter the transactions contemplated hereby
which the Buyer believes, in its reasonable, good faith determination, is likely
to render it impossible or unlawful to consummate the transactions contemplated
by this Agreement or that could have a Material Adverse Effect.
(c) Consents
and Approvals.
The
Buyer, Nanning, the Company, CWD and the Sellers shall have received or made,
each in form and substance satisfactory to the Buyer in its reasonable, good
faith determination all required filings and approvals from all Government
Authorities and notices to or required consents of any other third parties
that
the Buyer shall deem appropriate for the consummation of the transactions
contemplated by this Agreement.
(d) Resignations.
The
Buyer shall have received the resignations, effective as of the Closing, of
all
the directors and officers of the Company and Nanning, except for such persons
as Buyer shall have designated, and such persons as Buyer shall have designated
shall have been elected as directors and officers of the Company and Nanning,
to
be effective as of the Closing.
10
(e) Organizational
Documents.
The
Buyer shall have received a copy of (i) the Memorandum and Articles of
Association, as amended (or similar organizational documents), of each of the
Company and Nanning and accompanied by a certificate of the Secretary or
Assistant Secretary of such entity, dated as of the dated of the Closing,
stating that no amendments have been made to such Memorandum and Articles of
Association (or similar organizational documents) since such date, and (ii)
the
Bye-laws (or similar organizational documents) of each of the Company and
Nanning, certified by the Secretary or Assistant Secretary of such
entity;
(f) Minute
Books.
The
Buyer shall have received a copy of the minute books and stock registers of
the
Company and Nanning, certified by a Secretary or Assistant Secretary of the
Company and Nanning as of the date of the Closing;
SECTION
5.03 No
Material Adverse Effect.
No
event or events shall have occurred, or be reasonably likely to occur, which,
individually or in the aggregate, have, or could have, a Material Adverse
Effect.
ARTICLE
VI
SURVIVAL
OF REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION
SECTION
6.01 Survival.
All
representations, warranties, covenants and obligations of each party to this
Agreement shall, without regard to the death or dissolution of any party to
this
Agreement, survive the dated of the Closing and remain in full force and effect
for an unlimited period of time.
SECTION
6.02 Indemnification
by Sellers.
The
Sellers, jointly and severally, shall indemnify and hold harmless the Buyer,
CWD
and any Affiliate, successor or assign of the Buyer, or CWD (each an
“Indemnitee”), from and against, and shall compensate and reimburse each of the
Indemnitees for, any damages that are directly or indirectly suffered or
incurred by any of the Indemnitees or to which any of the Indemnitees may
otherwise become subject at any time (regardless of whether or not such damages
relate to any third party claim) and that arise directly or indirectly from
or
as a direct or indirect result of, or are directly or indirectly connected
with
any
breach of any of the representations or warranties made by any Seller in this
Agreement
or any
breach of any covenant or obligation of any Seller in this
Agreement.
SECTION
6.03 Indemnification
By Buyer and CWD.
The
Buyer
and CWD shall jointly and severally indemnify and hold harmless the Sellers
from
and against, and shall compensate and reimburse the Sellers for, any damages
that are directly or indirectly suffered or incurred by the Sellers or to which
the Sellers may otherwise become subject at any time (regardless of whether
or
not such damages relate to any third party claim) and that arise directly or
indirectly from or as a direct or indirect result of, or are directly or
indirectly connected with any breach of any representation or warranty made
by
the Buyer or CWD in this Agreement or any breach of any covenant or obligation
of the Buyer or CWD in this Agreement. The maximum liability of the Buyer and
CWD for any and all claims for indemnification made pursuant to this Agreement
shall not exceed the Purchase Price.
11
ARTICLE
VII
MISCELLANEOUS
SECTION
7.01 Expenses.
Each of
the parties shall bear its own expenses incurred in conjunction with the Closing
hereunder.
SECTION
7.02 Further
Assurances.
From
time to time, at the request of the Buyer and without further consideration,
the
Sellers shall transfer all other documents in relation to the Shares, the
Company and Nanning
SECTION
7.03 Parties
in Interest.
All the
terms and provisions of this Agreement shall be binding upon, shall inure to
the
benefit of, and shall be enforceable by the heirs, beneficiaries,
representatives, successors, and assigns of the parties hereto.
SECTION
7.04 Prior
Agreements; Amendments.
This
Agreement supersedes all prior agreements and understandings between the parties
with respect to the subject matter hereof. This Agreement may be amended only
by
a written instrument duly executed by the parties hereto or their respective
successors or assigns.
SECTION
7.05 Headings.
The
section and paragraph headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretations
of
this Agreement.
SECTION
7.06 Confidentiality.
Each
party hereby agrees that all information provided by the other party and
identified as "confidential" will be treated as such, and the receiving party
shall not make any use of such information other than with respect to this
Agreement. If the Agreement shall be terminated, each party shall return to
the
other all such confidential information in their possession, or will certify
to
the other party that all of such confidential information that has not been
returned has been destroyed.
SECTION
7.07 Notices.
All
notices, requests, demands, and other communications hereunder shall be in
writing and shall be deemed to have been duly given if delivered or mailed
(registered or certified mail, postage prepaid, return receipt requested) to
the
parties at their address specified herein, with a copy sent as
follows:
12
If
to the
Sellers:
19,
Xx
Xxxx Xi Shi Road,
Nanning
City,
Guangxi
Province, PRC
If
to the
Buyer or CWD:
17,
J
Avenue, Yijing Garden,
Aiguo
Road, Louhu District,
Shenzhen
City, PRC
SECTION
7.08 Effect.
In the
event any portion of this Agreement is deemed to be null and void under any
state or federal law, all other portions and provisions not deemed void or
voidable shall be given full force and effect.
SECTION
7.09 Counterparts.
This
Agreement may be executed simultaneously in several counterparts, each of which
shall be deemed an original, but all of which together shall constitute one
and
the same instrument.
13
IN
WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
Buyer and the Sellers on the date first above written.
| SELLERS: | BUYER: | |
| Shareholders of Pilpol (HK) Biological Limited | Fine Lake International Limited | |
| /s/ Xxxxx Xx | ||
| Xxxxx Xx | ||
| /s/ Xxxxxx Xxxxx | By: /s/ Xu Hong Bin | |
| Xxxxxx Xxxxx |
Name:
Xu Hong Bin
|
|
|
Title:
Director
|
||
| China Water and Drinks Inc. | ||
| By: /s/ Xu Hong Bin | ||
|
Name:
Xu Hong Bin
|
||
|
Title:
Director
|
14
