SHARE PURCHASE AGREEMENT
This SHARE PURCHASE AGREEMENT (this
“Agreement”) is made and entered into this December 24, 2008, by and between
Xxxxxx Xx (the “Purchaser”) and Hanqiao Zheng (the “Seller”).
RECITALS:
WHEREAS, the Seller is the owner of
18,706,943 shares (the “XXXX Shares”) of ownership interest of China Recycling
Energy Corporation, a Nevada Corporation (“XXXX”);
WHEREAS, the Purchaser is a natural
person and citizen of the People’s Republic of China;
WHEREAS, the Seller has determined that
it is in his best interests to sell, subject to the terms and conditions set
forth herein, all of the XXXX Shares; and
WHEREAS, the Purchaser has determined
that it is in his best interests to purchase, subject to the terms and
conditions set forth herein, all of the XXXX Shares.
AGREEMENT:
NOW, THEREFORE, in consideration of the
premises and the agreements set forth herein, the Seller and the Purchaser agree
as follows:
ARTICLE
I
SHARE
PURCHASE
Section 1.01. The Share
Purchase. Subject to the terms and conditions of this
Agreement, the Seller agrees to assign, transfer and deliver to the Purchaser,
at the Closing, all the XXXX Shares (18,706,943 shares) owned by him
for US Dollars 7,482777.20 in cash (US $ 0.40/per share representing
the fair market price of the XXXX common stocks quoted on OTCBB on the closing
date of December 23, 2008) (the “Share Purchase”).
Section 1.02. Execution
and Closing. The Share Purchase shall take place at such time and place
as the Seller and the Purchaser mutually agree upon, orally or in writing (which
time and place is designated as the “Closing”). The Seller shall
deliver to the Purchaser either (i) a certificate or certificates representing
the XXXX Shares or (ii) instruments of assignment or transfer that shall, in the
reasonable opinion of the Purchaser be necessary to transfer the XXXX Shares to
the Purchaser. The Purchaser shall also make the full payment of
7,482777.20 US Dollars to the Seller by either (i) bank wire transfer or (ii)
cashier’s check. The Agreement is not deemed executed and the Share
Purchase is not deemed completed until the Purchaser receives the physical
certificates representing the XXXX Shares delivered by the Seller and the Seller
receives the full payment made by the Purchaser.
ARTICLE
II
REPRESENTATIONS
AND WARRANTIES
Section 2.01. Representations
and Warranties of the Purchaser. The Purchaser represents and
warrants to the Seller as follows:
(a) The
Purchaser has all power and authority to execute, deliver and perform this
Agreement.
(b) The
XXXX Shares will be acquired for investment for the account of the Purchaser,
and not as a nominee or agent, and not with a view to the distribution or public
offering thereof. In connection therewith, the Purchaser confirms that he is
neither a U.S Person, as such term is defined in Rule 902(k) of Regulation S,
nor located within the United States, and that the transaction will be between
non-U.S. Persons, and take place outside of the United States.
(c) The
Purchaser has not been contacted concerning the acquired XXXX Shares or the
matters set forth in this Agreement by means of any advertisement or other
general solicitation.
(d) The
Purchaser understands that (i) the acquired XXXX Shares have not been registered
under either the Securities Act of 1933, as amended (the “Securities Act”) or
the securities laws of any state by reason of specific exemptions therefrom and
that such securities may be resold in the United States without registration
under the Securities Act only in certain limited circumstances.
(e) The
Purchaser has access to information relating to XXXX as the Purchaser deems
necessary to make an informed investment decision in connection with the
acquired XXXX Shares, and except as provided in Section 2.02 below, the Seller
is making no representations and warranties concerning the acquired XXXX Shares
or the business of the XXXX.
(f)
Purchaser understands that Regulation S promulgated under the Securities Act, is
available only for offers and sales of securities outside the United States, and
will comply with Regulation S, specifically complying with the restrictions on
re-sale of the securities of Rules 903 (a) and (b)(3) of Regulation
S.
(g) Legends. The
Purchaser acknowledges that the XXXX Shares he acquires will bear the following
restrictive legend:
THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY
PURCHASING THE SECURITIES, ACKNOWLEDGES THAT SUCH SECURITIES MAY BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY: (A) TO THE COMPANY, (B)
OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
REGULATION S UNDER THE SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE LOCAL OR
STATE LAWS AND REGULATIONS, (C) INSIDE THE UNITED STATES PURSUANT TO (I) RULE
144A UNDER THE SECURITIES ACT TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS
A QUALIFIED INSTITUTIONAL BUYER THAT IS PURCHASING FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF ONE OR MORE QUALIFIED INSTITUTIONAL BUYERS TO WHOM WRITTEN NOTICE
IS GIVEN THAT THE OFFER, SALE OR TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A
OR (II) THE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER, IF AVAILABLE, AND ANY APPLICABLE STATE SECURITIES LAWS OR
(D) IN A TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT
OR ANY APPLICABLE UNITED STATES FEDERAL OR STATE SECURITIES LAWS, AFTER
PROVIDING AN OPINION OF COUNSEL OF RECOGNIZED STANDING REASONABLY SATISFACTORY
TO THE COMPANY TO THAT EFFECT.
(h) The
Purchaser acknowledges that he is aware of his obligations under the Securities
Exchange Act of 1934 (the “1934 Act”), including, but not limited to those
filing obligations that are triggered as a result of the consummation of the
sale of the XXXX Shares pursuant to Sections 13 and 16 of the 1934 Act, together
with filings required to be made by the Company, under the control of the
Purchaser, after the consummation of the sale of the XXXX Shares.
Section 2.02. Representations
and Warranties of the Seller. The Seller represents and
warrants to the Purchaser as follows:
(a) The
Seller has all power and authority to execute, deliver and perform this
Agreement.
(b) This
Agreement is the valid and binding obligation of the Seller, enforceable against
the Sellers in accordance with its terms.
(c) The
Seller is the record and beneficial owner of the XXXX Shares acquired by
Purchaser, and the XXXX Shares conveyed pursuant to this agreement have not been
assigned, pledged, sold, transferred or otherwise previously conveyed; provided,
however, the XXXX Shares are pledged pursuant to that certain Share
Pledge Agreement dated November 16, 2007, as amended by that First Amendment to
Pledge Agreement dated the date hereof.
ARTICLE
III
MISCELLANEOUS
Section 3.01. Governing
Law; Successors and Assigns. This Agreement shall be governed and
construed in accordance with the law of the State of New York and applicable
federal law and shall be binding upon the heirs, personal
representatives, executors, administrators, successors and assigns of
the parties
Section 3.02. Entire
Agreement. This Agreement constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersedes and
replaces any prior agreement or understanding between the Purchaser and the
Seller with respect to the transfer of the XXXX Shares between the Seller and
the Purchaser.
Section 3.03. Headings. The
headings of the Sections of this Agreement are for convenience and shall not by
themselves determine the interpretation of this Agreement.
Section 3.04. Counterparts.
This Agreement may be executed in any number of counterpart copies, all of which
copies shall constitute one and the same instrument.
Section 3.05. Independent
Counsel. The Purchaser and the Seller each acknowledge that
this Agreement has been prepared by XxXxxxx Long & Xxxxxxxx LLP, counsel to
XXXX, and that XxXxxxx Long & Xxxxxxxx LLP is not representing, and is not
acting on behalf of, the Seller or Purchaser in connection with this
Agreement. The Seller and Purchaser have been provided with an
opportunity to consult with their own counsel and their own business, securities
and tax advisors with respect to this Agreement.
(THE
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK)
(SIGNATURE
PAGE FOLLOWS)
IN WITNESS WHEREOF, the
parties hereto have signed this Share Purchase Agreement as of the date first
above written.
| SELLER | |||||
| By: |
/s/
Hanqiao Zheng
|
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|
Hanqiao
Zheng
|
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| PURCHASER | |||||
| By: |
/s/
Xxxxxx Xx
|
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|
Xxxxxx
Xx
|
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