Reorganization Agreement January 19, 2006
Exhibit
10.2
January
19, 2006
This
agreement is entered into between Yangling Daiying Biotech & Pharmaceutical
Group Co., Ltd (“Yangling Daiying”) and Hunan Ze An Pharmaceutical Co., Ltd.
(“Ze An” formerly Hunan Xxx Xxx Pharmaceutical Co., Ltd.) and its shareholder
Xxxxxxx Xx, Xxxxx Xxxx and Xxxxxxxx Xx (“Shareholders of Ze An”).
Yangling
Daiying Biotech & Pharmaceutical Group Co., Ltd is a stock-based company
incorporated at No.10 Xxx Xxxxx South Road, Yangling Demonstration Zone,
Shaanxi, P.R. China, and with Xxxxxx Xxx as its legal
representative.
Hunan
Ze
An Pharmaceutical Co., Ltd is a limited company incorporated at Anxiang
Industrial Park, Hunan, P.R. China, and with Xxxxxxx Xx as its legal
representative.
In
order
to optimize and coordinate Yangling Daiying and Ze An’s resources, promote the
cross-province development, satisfy the requirements of the market, two parties
agree to reorganize under the following terms and conditions after carefully
considering the advantages of the two parties:
| 1. |
Shareholders
of Yangling Daiying and Ze An agree that the Reorganization Agreement
is
entered based on the principles of equality, free-will and mutual benefit.
This agreement is made in accordance with the Chinese laws and Xxxxx
Xxxx
is the legal representative of Ze An who is also the entitled person
to
sign on this agreement.
|
| 2. |
Shareholders
of Ze An invested RMB8,000,000 to found Ze An which is confirmed by
Yangling Daiying.
|
| 3. |
Yangling
Daiying shall pay Xxxxxxxx Xx RMB 1,440,000 for 18% of Ze An which
is held
by Xxxxxxxx Xx; Yangling Daiying shall pay Xxxxxxx Xx RMB1,960,000
and
120,900 shares of common stocks of Worldwide Biotech & Pharmaceutical
Company for 52% of the total stocks originally held by Xxxxxxx Xx which
equals 37% of the total ZeAn’s stock. The unit price of common stocks is
calculated as the negotiable price say, $1 per share and the total
amount
of which equals to RMB3,992,800 using the agreed upon exchange rate
of
RMB8.27 to US$1.00. Yangling Daiying shall pay Xxxxx Xxxx 90,670 shares
of
common stocks of Worldwide Biotech & Pharmaceutical Company for 10% of
Ze An which is held by Xxxxx Xxxx. The unit price of common stocks
is
calculated as the negotiable price say, $1 per share and the total
amount
of which equals to RMB3,992,800 using the agreed upon exchange rate
of
RMB8.27 to US$1.00. After the reorganization, Yangling Daiying controls
65% of Ze An, Xxxxx Xxxx controls 20% and Xxxxxxx Xx controls
15%.
|
| 4. |
Payment
Methods in Cash and Equity
|
| a) |
Yangling
Daiying shall pay Xxxxxxx Xx RMB720,000 and Xxxxxxx Xx RMB980,000 as
soon
as the Reorganization Agreement is
entered.
|
| b) |
It’s
Yangling Daiying’s responsibility to have its parent company, Worldwide
Biotech & Pharmaceutical Company to issue 120,900 shares of its common
stocks to Xxxxxxx Xx and 90,670 shares to Xxxxx
Xxxx.
|
| c) |
With
the cooperation of Ze An, Yangling Daiying has the responsibility to
do
the necessary filings for the reorganized company, such as registration,
tax report, registrations at the State Food and Drug Administration,
intellectual properties, trademarks, and related processes after the
acquisition. Yangling Daiying shall pay Xxxxxxxx Xx RMB720,000 and
Xxxxxxx
Xx RMB500,000.
|
| d) |
Shareholders
of Ze An acknowledge that Ze An does not have any undisclosed debts,
liabilities, assets lost, on-going lawsuit and potential lawsuit against
Ze An. Otherwise, shareholders of Ze An shall take all legal
responsibilities.
|
| e) |
The
reorganized company must be audited by international accountant firm,
shareholders of Ze An must assist the accountant firm to review the
financials for the former financial years. Yangling Daiying shall pay
Xxxxxxx Xx 480,000 when the financial auditing on Ze An is
done.
|
| 5. |
The
reorganized company shall appoint new Board of Directors. Yangling
Daiying
shall be the legal representative of the reorganized
company.
|
| 6. |
Upon
finishing the transaction, the new company shall be the share-controlling
company of Yangling Daiying, all of the operation activities shall
be in
accordance of Law of Corporations of P.R. China and Article in Law
of the
new company. Yangling Daiying has responsibilities to supervise, inspect
and direct the operation activities of the new company.
|
| 7. |
Upon
closing the transaction, the two parties shall cooperate with each
other
to finish the necessary registration process, and authorize international
accountant firm to start audit on Ze An’s
financials.
|
| 8. |
The
agreement can be amended with the written permissions from both parties.
|
| 9. |
Breaches
of the agreement: If there’s any party breaches any terms of the
agreement, the other party have the right to terminate the contract
and
request for compensation for all related damages, the disputed shall
be
resolved through arbitration or legal proceedings. The
agreement is governed by China law and under the jurisdiction of the
court
in Xi’an, P.R. China.
|
| 10. |
There
are six original copies of this Agreement, of which Yangling Daiying
takes
two copies, Ze An takes two copies and the other two copies are backed
up
at the related authorities.
|
| Yangling Daiying: Yangling Daiying Biotech Engineering Co., ltd | ||
| |
|
|
| Date: January 19, 2006 | By: | /s/ Xxxxxx Xxx |
|
|
||
| Legal Representative | ||
| Ze An: Hunan Ze An Pharmaceutical Co. Ltd. | ||
| |
|
|
| Date: January 19, 2006 | By: | /s/ Xxxxxxx Xx |
|
|
||
| Legal Representative | ||
