SETTLEMENT AGREEMENT AND RELEASE
SETTLEMENT
AGREEMENT AND RELEASE
This
Settlement Agreement and Release (“Agreement”) is entered into this 6th day of
August, 2010 (the “Effective Date”) by and among Sinary Bio-Technology Holdings
Group, Inc. (“Sinary”) on the one hand, and Xxx Xxxx and Xxx Xxxx (together with
Xxx Xxxx, the “Sellers”), on the other hand. Sinary and the Sellers will be
referred to collectively in this Agreement as the “Parties.”
RECITALS
WHEREAS,
Sinary is a corporation organized under the laws of the State of
Nevada;
WHEREAS,
the Sellers were the owners of 100% of the equity interests in Heilongjiang
Weikang Bio-Technology Group Co., Ltd., a limited liability company
(“Heilongjiang Weikang”) organized and existing under the laws of the Peoples
Republic of China (“PRC”);
WHEREAS,
on October 25, 2007, Sinary entered into an Equity Interest Transfer Agreement
(the “Transfer Agreement”) with the Sellers, pursuant to which the Sellers
transferred to Sinary 100% of the equity interests of Heilongjiang Weikang in
consideration for Sinary’s agreement to pay the Sellers the sum of RMB
57,000,000 (the “Acquisition Price”) none of which has been paid as of the date
of this Agreement;
WHEREAS, pursuant to the terms of the
Transfer Agreement and the requirements of applicable PRC laws and regulations,
Sinary had until August 6, 2009 to remit the Acquisition Price, which date was
extended to June 30, 2010 pursuant to a verification letter issued by the
applicable PRC government agency on August 7, 2009;
WHEREAS,
on December 7, 2007, Weikang Bio-Technology Group Co., Ltd. (the “Company”), the
majority shareholders of the Company, Sinary and Xxxxx Xxxx, the sole
shareholder of Sinary, entered into a Share Exchange Agreement (the “Exchange
Agreement”), pursuant to which, Xxxxx Xxxx exchanged all of the outstanding
shares of Sinary for 24,725,200 shares of the Company’s common stock and Sinary
became a wholly-owned subsidiary of the Company;
WHEREAS,
pursuant to the Exchange Agreement, Sinary delivered $650,000 in cash to the
Company to pay all the Company’s outstanding obligations and to repurchase
certain outstanding shares of the Company’s common stock, which sum was advanced
to Sinary by Xxx Xxxx, a former shareholder of Heilongjiang Weikang and remains
unpaid as of the date of this Agreement (the “Advance” and together with the
Acquisition Price, the “Total Acquisition Price”);
WHEREAS,
on January 6, 2010 Xxxxx Xxxx formed Lucky Wheel Limited, a British Virgin
Islands corporation (“Lucky Wheel”). Xx. Xxxxx Xxxx is the sole
shareholder of Lucky Wheel. On June 29, 2010, Xx. Xxxx transferred
22,925,200 of her shares of the Company’s common stock to Lucky Wheel and
entered into a Call Option Agreement (the “Option Agreement”) with Xxx Xxxx,
pursuant to which Xxxxx Xxxx granted Xxx Xxxx an option to purchase, on terms
and conditions set forth in the Option Agreement, up to 100% of the shares of
Lucky Wheel. If and when the option is fully exercised, Xxx Xxxx will
become the sole shareholder of Lucky Wheel;
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WHEREAS,
Sinary and the Sellers desire to resolve the issues of payment of the Total
Acquisition Price and any claims that Sellers may have against Sinary, the
Company, any of its subsidiaries and affiliated entities, and any of the
Company’s officers, directors, employees and agents (the “Acquisition Price
Claims”) in accordance with this Agreement.
NOW,
THEREFORE, in consideration of the rights granted pursuant to the Option
Agreement, and the mutual promises and covenants contained herein, the
sufficiency and receipt of which is hereby acknowledged, the Parties hereby
agree as follows:
AGREEMENT
1. Acknowledgment of
Recitals. The factual statements set forth in the Recitals are
hereby incorporated herein and reaffirmed by the Parties as if fully set forth
in this Agreement.
2. Waiving Rights to Payment of Total
Acquisition Price. The Sellers and each of them hereby waive
any right that Sellers have to payment of the Total Acquisition Price by way of
a contribution to capital.
3. Release
of Claims against Company.
(a) As
of the Effective Date, the Sellers and each of them, hereby fully and completely
release and discharge absolutely and forever, the Company, its parents,
affiliates, subsidiaries, officers, directors, shareholders, attorneys, legal
representatives, partners, agents and employees, and their successors and
assigns (the “Released Parties”), from any and all claims, rights, demands,
injuries, debts, damages liabilities, acts or omissions, obligations, actions,
causes of action, costs, expenses or liens, whether known or unknown, suspected
or unsuspected, of every kind or nature which now exist or have existed in favor
of the Sellers, including those arising from or in any way connected to the
Exchange Agreement, the failure to pay the Total Acquisition Price, and any
acts, statements, conduct, representations and omissions made by any of the
Released Parties in connection therewith.
(b) The
Sellers and each of them hereby acknowledge that neither of the Sellers has
relied upon any representation of any kind made by any of the Released Parties
in making the foregoing release.
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(c) SELLERS
UNDERSTAND THAT THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN
CLAIMS. In giving the release herein, which includes claims which may
be unknown to Sellers at present, Sellers acknowledge that each of them have
read and understand Section 1542 of the California Civil Code, which reads as
follows:
A
general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which
if known by him or her must have materially affected his or her settlement with
the debtor.
Sellers
hereby expressly waive and relinquish all rights and benefits under that section
and any law of any other jurisdiction of similar effect with respect to Sellers
release of any unknown or unsuspected claims herein.
(d) The
Sellers and each of them hereby agree, represent and warrant that each has
obtained the advice of independent counsel of his own choosing, in negotiations
for and the preparation of this Agreement, including the foregoing release, that
each has read the provisions of this Agreement, including the foregoing release,
that each has had the foregoing release fully explained by such counsel, and
that each is fully aware of its contents and legal effect. The
Sellers and each of them hereby agree, represent and warrant that the Sellers
and each of them have executed this Agreement on the advice of such counsel,
after careful and independent investigation, and not under fraud, duress or
undue influence.
3. Miscellaneous
Provisions.
(a) This
Agreement is made exclusively for the benefit of and solely for the protection
of the Sellers on the one hand, and the Released Parties on the other hand, and
no other person or persons shall have the right to enforce the provisions hereof
by action or legal proceedings or otherwise.
(b) This
Agreement is entered into, shall be governed by, and shall be construed in
accordance with, the laws of the State of California for contracts made and to
be performed therein.
(c) This
Agreement may not be changed or modified or any covenant or provision in this
Agreement waived, except by another agreement, in writing, signed by the party
affected by the modification or waiver.
(d) This
Agreement constitutes the entire, final and binding agreement between the
Parties; no other statement or representation, written or oral, express or
implied, has been received and relied upon in the settlement contained in this
Agreement; and all prior discussions, statements and negotiations made or that
have occurred prior to the Effective Date shall be deemed merged into this
Agreement and shall not be used for any other purpose whatsoever.
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(e) Each
of the Parties acknowledges that he or it: (i) has read and understands the
provisions of this Agreement; (ii) has consulted, with legal counsel who has
read and reviewed this Agreement; (iii) understands the rights and remedies that
the Parties are receiving, the rights that Sinary is forbearing from and the
rights and remedies that the Sellers are waiving by their agreement thereto; and
(iv) has made the agreements set forth herein knowingly, voluntarily and
intentionally.
[Signature
Pages Follow]
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IN
WITNESS WHEREOF, the parties have executed this Agreement as of the day and year
first written above, which shall be deemed its Effective Date.
| SINARY BIO-TECHNOLOGY HOLDINGS GROUP, INC. | |||
| By: | /s/ Xxxxx Xxxx | ||
| Name: Xxxxx Xxxx | |||
| Title: President | |||
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Xxx
Xxxx
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By:
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/s/ Xxx Xxxx | ||
| Name: Xxx Xxxx | |||
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Xxx
Xxxx
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By:
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/s/ Xxx Xxxx | ||
| Name: Xxx Xxxx | |||
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