Exhibit 10.10
JILIN YICAOTANG PHARMACEUTICAL CO., LTD. EQUITY AND CLAIM TRANSFER AGREEMENT
Party A (Transferor): Jilin Xxxx Xxx Science and Technology Limited Company
Legal Representative: Ms. Lianqin Qu
Business Address: 000 Xxxxxxxx Xxxxxx, Xxxx-Xxxx Development Area, Changchun,
Jilin, China.
Party B (Transferee): Xx. Xxxxxx Xxxx
National ID: 220225196010230114
Where as:
1. Party A is a corporation registered with Commerce and Industry Bureau
of Jilin.
2. Party B is a Chinese resident with civil capacity.
3. Jilin Yicaotang Pharmaceutical Co., Ltd. ("YCT") has a registered
capital of 10,000,000 RMB, Party A has 95% of equity interest.
4. As of January 21, 2007, YCT's has total asset of 23,840,000 RMB, total
liability of 15,930,000 RMB, net asset 7,910,000 RMB, Party A owns
7,520,000 RMB of YCT's shareholder's equity. Party A is also YCT's
creditor of 9,780,000 RMB debt (including 925,500 RMB debts which the
creditor is Jilin Bencaotang Pharmaceutical Co., Ltd ("BCT"), Party A
holds 75% of equity interest of BCT).
Based on the above, after negotiation, both Parties have made the following
agreement on the sale of Party A's shares and claims of YCT to Party B:
1. Party A will transfer 9,500,000 shares (represent 95% of the total
outstanding shares of YCT) and 9,780,000 RMB claims to Party B. The
consideration is 9,000,000 RMB (including the shares and claims).
2. Payment schedule (Party B is to pay the amount shown on the due date):
Due Date Amount Due (in RMB)
-------- -------------------
3 days after signing this agreement 500,000
May 30, 2007 500,000
November 30, 2007 1,000,000
May 30, 2008 1,000,000
November 30, 2008 1,000,000
May 30, 2009 1,000,000
November 30, 2009 1,000,000
May 30, 2010 1,000,000
November 30, 2010 1,000,000
May 30, 2011 1,000,000
Party B may make payment before the due date.
3. Party A will assist the share transfer and update YCT's Company
By-Laws and the shareholders list within one month when the first
payment of 500,000 RMB is made. Party B is responsible for the fees
for transferring of the shares.
4. After the shares are transferred to Party B, these shares (9,500,000
shares) will be used as collateral for the remaining payment of
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8,500,000 RMB. Party B is not allowed to transfer or dispose any
shares before the payment is made in full.
5. After the shares are transferred to Party B, Party B will be
responsible for all the liabilities and claims of YCT.
6. If Party B is unable to make a payment on the due date, Party A will
charge Party B 0.5% interest on the balance past due. If Party B is
unable to make a payment and interested (if any) within 6 months of
the due date, Party A is entitled to receive the unpaid shares and the
management of YCT. If Party B is unable to make a payment and Party A
claims the unpaid shares, the net asset per share at the time of the
claim should not be less than the net asset per share at the time when
Party A transfers the shares to Party B (Party B will pay the
difference if that is the case). When Party A claims the unpaid
shares, Party A is also entitled to part of the claims of YCT, up to
the percent of the shares it holds. When Party A claims the unpaid
shares, the interest charges (if there is any) is also due.
7. Before Party B made full payment to Party A, if either party violated
any part of this agreement, the party which violated the agreement
should compensate the other party for the loss.
8. Both Parties may negotiate additional agreement, the additional
agreement has the same legal status as this agreement.
9. This agreement has three copies, each party holds one copy, YCT holds
one copy. 10. This agreement is effective once signed by both parties
and stamped by Party A.
Party A (Transferor): Jilin Xxxx Xxx Science and Technology Limited Company
Legal Representative: Lianqin Qu (Signature) /s/ Lianqin Qu
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Party B: Xxxxxx Xxxx
Signature: /s/ Xxxxxx Xxxx
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Date: May 11, 2007
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