M&A Agreement
Exhibit
10.1
Party
A: Shouguang
City Haoyuan Chemical Co., Ltd ("Haoyuan")
Party
B: YUAN
Fengxia, XXXX Xxxx, XXXX Xxx
To
optimize business structure and meet the demand of business development for the
realization of maximal mutual benefit, Party A and Party B, after amicable
consultation based on the principles of mutual interest and development and in
the spirit of cooperation and win-win, have entered into this Agreement as
follows:
1. Party
A acquires from Party B all the assets (see attached table of itemized assets)
of the bromine factory (annual bromine production capacity of 4,000
ton and annual salt production capacity of 150,000 ton) located in Beishan
Village, Yingli Township, Shouguang City; the final consideration of the
acquisition is determined to be XXX 000 xxxxxxx (xx which 70% to be paid in cash
and 30% in stocks issued by Haoyuan's US parent company with the stock price
based on the average price of the last 30 trading days prior to the transaction
date).
2. Upon
completion of the M&A, the ownership of all the factory buildings,
production facilities, water xxxxx, underwater cables, electricity provision
facilities that are currently in Party B's ownership shall belong to Party
A. Party B shall be responsible for its original debt claims and loan
obligations. In addition, Party B shall ensure that the unusable
xxxxx listed on the table of itemized assets must not exceed 10 and the length
of the unusable water ditches must not exceed 200 meters; otherwise, there shall
be a deduction, from the total consideration hereunder, at the rate of 2 times
the replacement cost.
3. Party
B promises that Party B will automatically dissolve the 50-year land lease
contract between Party B and the village in the production area with regard to
11.02 km2 land
and that Party B shall assist our company [sic, meaning Haoyuan] in entering
into a new 50-year land lease contract with the village; otherwise, Party B
shall pay 10% of the security deposit as compensation to Party A.
4. Party
B promises that it will dissolve the employment contracts with its original
factory workers and pay them their salaries and compensation pursuant to the
relevant laws and statutes of the State; Party B guarantees that Party A will
not experience any related disputes with its original employees and that Party B
will should properly handle the placement work for its original employees. Party
A has the right to recruit its own employees based on its
need.
5. Party
B promises that it will settle all the contracts with its original suppliers and
customers, and resolve all corresponding debt claims and loan obligations, and
guarantees that Party A will not have any related disputes with its original
suppliers and customers. Party A has the right to choose its new suppliers and
customers and enter into new contract with them.
6. Party
A only purchases the production-related facilities and inventories, has no
relationship with the original operating entity , and will not assume any rights
and obligations from the original operating entity.
7. Upon
execution of this Agreement, Party A shall pay to Party B 20% of the
consideration in the total amount of RMB 22.1 million as security deposit; upon
payment of the deposit, Party A will enter the premise to commence the
production organization. Within 3 days upon the execution of this
agreement, Party A and Party B shall form an assets inventory group to take
inventory of Party B assets on the premise. Upon completion of the
asset inventory, and on the condition that there is no dispute, Party
A shall pay all the cash portion of the total transfer consideration (i.e., RMB
56 million even) by September 30, 2009. Party A and Party B will then
formally proceed with the procedures of the hand-over (including relevant land
lease contract and the execution of a new land lease contract for which Party B
has the responsibility for assistance as Party A requested).
8. If
Party A fails to pay the remaining cash portion of the acquisition consideration
by September 30, 2009, Party B has the right to terminate the M&A agreement,
and Party B shall keep the security deposit, recover all the assets of the
bromine factory and have no legal responsibility.
9. The
two parties shall discuss supplemental agreement regarding other matters not
covered herein and the supplemental agreement shall have the same legal
effect. Any dispute about this agreement may be submitted to the
People's Court of Shouguang City.
10. This
agreement is in duplicate, with one to each party.
|
Party
A:
|
Shouguang
City Haoyuan Chemical Co., Ltd (company
seal)
|
|
Legal Representative:
|
/s/ Xxxx XXXX |
|
Party
B:
|
WANG Han /s/WANG
Han
XXXX
Xxxx /s/
XXXX Xxxx
XXXX
Xxxxxxx
/s/ XXXX
Xxxxxxx
|
August 31, 2009
