Exhibit 10.3
CERTIFICATES CHANGE AND TECHNOLOGY SHARING AGREEMENT OF EIGHTEEN WELLNESS
PRODUCTS
This Agreement has been entered into as of October 26, 2005 in Wuqing New Tech
Industrial Park, Tianjin, and P.R.C. by the following Parties:
Assignor: Tianjin Tianshi Biological Development Co.,Ltd.( Hereinafter " Party
A") Legal Registered Office: Wuqing New Tech Industrial Park, Tianjin, P.R.C.
Legal Person: LI,JINYUAN
Assignee: Tianjin Tianshi Biological Engineering Ltd.( called Party B below)
Legal Registered Office: No.6, Yuanquan Rd. Wuqing New Tech Industrial Park,
Tianjin, P.R.C Legal Person: LI,JINYUAN
Whereas Party A holds the ownership of "Wellness Products Certificates" of 18
wellness products approved by State Food and Drug Administration of the P.R.
China (refer to Appendix 1) and relevant manufacture technology; and Party A
desires to change the sole ownership of "Wellness Products Certificates" of 18
wellness products and relevant manufacture technology into sharing ownership by
Party A and Party B,; and
Whereas Party B has long term cooperation relationship with Party A, and Party B
is responsible for sales and marketing of such 18 wellness products in China for
a long time. Party B agrees to share with Party A the above ownership of
"Wellness Products Certificates" of the 18 wellness products and manufacture
technology.
Therefore, in consideration of reinforcing the cooperation between the two
Parties and achieving the maximized economical benefits and returns for both
sides, Party A and Party B hereto agree as follows with regard to the above
ownership of "Wellness Products Certificates" of the 18 wellness products and
relevant manufacture technology:
1. CHANGE OF OWNERSHIP
1.1 Party A agrees to change the ownership of "Wellness Products Certificates"
of 18 wellness products and relevant manufacture technology, which is wholly
owned and indicated in Appendix 1. After changing, Party A and Party B holds the
above ownership of "Wellness Products Certificates" of 18 wellness products
together.
1.2 Party B agrees the above changing of ownership of 18 Wellness Products
Certificates and relevant manufacture technology, and agrees to share with Party
A the above ownership of 18 Wellness Products Certificates and relevant
manufacture technology.
1.3 Both Parties agree to apply to relevant authority for the changing ownership
of 18 Wellness Products Certificates and relevant manufacture technology in both
Parties' name. Both Parties shall prepare for and submit the required documents
based upon the requirements of authority and handle the relevant examining
procedures together.
1.4 After the changing of ownership, Party A and Party B shall hold the changed
ownership together and both Parties shall take the right as the owners of 18
Wellness Products Certificates and bear the obligations. Either of Party A or
Party B has the right to use the 18 Wellness Products Certificates solely and
under no restriction to produce, manufacture and sell the wellness products in
accord with the requirements of 18 Wellness Products Certificates and relevant
laws.
1.5 Both Parties agree that either of two Parties is not allowed to transfer the
ownership to any third party after the sole ownership of 18 Wellness Products
Certificates is changed into sharing ownership of two Parties.
1.6 Both Parties agree to recommend Party A as the principal of the 18 Wellness
Products Certificates after the changing of ownership based upon the provisions
of " Regulations of Wellness Products".
2. BUSINESS SCOPE AFTER TRANSFER OF OWNERSHIP
2.1 After the change of ownership of "Wellness Products Certificates" of the 18
wellness products, Party A and Party B still take the right of employing the
certificates within the scope prescribed previously.
2.2 After the transfer of manufacture technology of 18 wellness products, Party
B shall apply the technology without any restriction except for national laws
and regulations.
2.3 Party B shall bear all the responsibilities as a result of employing the
"Wellness Product Certificates" of 18 wellness products beyond the registered
business scope or against the laws.
3. COSTS FOR CHANGE
3.1 Both Parties come to the agreement that the costs for the change of the
ownership of the "Wellness Products Certificate" of the above 18 wellness
products and the production technology should be pursuant to the "Market
Evaluation Report" from the Nutrition Supplements Market Committee of the China
Healthcare Association.
3.2 Both Parties come to the agreement that the change of the ownership of the
"Wellness Products Certificate" of the above 18 wellness products and the
production technology aims at the reinforcement of bilateral cooperation and the
realization of economic returns satisfactory for both sides, and the transaction
price should be in accordance with what is confirmed in the "Market Evaluation
Report": Party B makes a payment of 9,869,796 RMB to Party A as the transfer
price.
3.3 Any cost charged in the process of the ownership change, including but not
limited to the fees from Approval authority, will be charged to Party A.
4. WAYS OF PAYMENTS
Party B must make the payment to Party A in accordance with the following
deadlines upon receiving the invoices from Party A:
4.1 Make a deposit equal to 20% of the total price upon the Agreement is signed,
that is 1,973,959.2 RMB.
4.2 Party B should pay the rest 7,895,836.8 RMB within 7 days after the
ownership name change of the "Wellness Products Certificate" 4.3 Both Parties
unanimously agree to pay by (1) cash, (2) check (3) remittance Payment by
remittance from Party B should be remitted to the designated account of Party A:
Account Number:
Name of the Bank:
5. TECHNOLOGY TRANSFER
5.1 Party A agrees to transfer all the specific technologies for wellness
products, including but not limited to the technological documents about
products formulations, production techniques, quality standard etc. to Party B,
simultaneously with the change of the ownership of the "Wellness Products
Certificate" of the wellness products, in order for Party B to produce the 18
wellness products under the "Wellness Products Certificate".
5.2 Party A should deliver the technologic documents to Party B within 7 working
days after the approval of the change of ownership of the "Wellness Products
Certificate" of the 18 wellness products.
5.3 After the delivery of the technologic documents to Party B, Party A should
still bear the responsibility to instruct Party B to test, try out and produce
until Party B can produce the first qualified products, but Party A does not
bear the responsibility of economic return attainable for Party B.
5.4 The specific technology for the 18 wellness products is jointly owned by
both Parties after the technologic transfer. Either Party is not allowed to
transfer the specific technology to any third party without the written
permission of the other party. Besides, without any restrictions, either Party
has the authority to employ the 18 specific technologies to manufacture, produce
and sell wellness products in its own name in accord with the "Wellness Products
Certificate".
5.5 Any newly exploited technical production based on the 18 specific
technologies from either Party after the technology transfer should belong to
both Parties.
5.6 After the technology transfer, both Parties should keep the technology under
secret conditions and are not allowed to disclose to any third party.
6 TESTING STANDARDS AND TESTING MANNERS FOR THE TECHNOLOGY TRANSFER
6.1 Testing Standards: in accordance with the national or industrial standards.
If no national or industrial standards, in accordance with the technologic
parameters promised to achieve by Party A.
6.2 Testing manners: Party B receives the technologic documents from Party A,
fully understands the content, and signs for confirmation.
7. DOCUMENT DELIVERY
7.1 The relevant technologic documents and letters, required by the Agreement,
shall be written in Chinese and delivered by courier or fax;
7.2 All the documents for delivery shall be regarded to have been delivered
according to the following date, whichever happens first:
o If delivered by courier, the date when they are submitted;
o If delivered by fax, the date when the return receipt is confirmed.
8. REPRESENTATIONS AND WARRANTIES
8.1 Party A and Party B each respectively represents and warrants that it has
the authority and capacity to enter into and execute this Agreement. The two
parties have hereto signed this agreement by their duly authorized officers and
representatives. The conclusion and execution of this agreement does not cause
to be in breach of any contract to or infringe the rights and interests of the
third party, or cause the other party to be liable for any responsibility to any
third party as a result of the performance of this agreement.
8.2 Party A represents and warrants that it owns the entire intellectual right
and technology material of the eighteen wellness products prior to such
agreement. It guarantees that the conclusion of the agreement does not infringe
any third party's technical rights and interests. Party A shall be responsible
for dealing with any legal issues which may incur and bear any costs and
liabilities in connection with the performance of this agreement.
8.3 Party A guarantees that the technical material which is transferred to Party
B is the most recent, and Party B holds the same technical material as Party A
does. It guarantees that the material is complete, properly drafted, and
reliable. Party A shall transfer the material to party B in accordance with the
rules hereinto.
8.4 Party B guarantees that it has acquired or shall acquire the production
license, healthy certification, and guarantees that it meets all the necessary
requirements for producing and manufacturing wellness products.
8.5 Party B guarantees that it products and manufactures in accordance with the
original formulation, quality standard, production techniques of the six
wellness products and in compliance with national laws and regulations. Party B
is responsible for any economic losses suffered by itself as a result of Party
B's breaching the above articles under this agreement. And Party B shall
reimburse Party A any economic losses, directly or indirectly suffered by Party
A arising out of or in connection with Party B's default.
9. LIABILITY FOR BREACH OF THE AGREEMENT
9.1 If Party A does not provide Party B with the technical materials and
guidance on tests, trial, and production in accordance with the time, quantity,
quality provisions stipulated hereinabove, Party A shall pay Party B penalty
equal to the sum of 5% of technology transfer fee.
9.2 If Party A transfers such technology to any third party without prior
approval by Party B, it shall pay Party B penalty equal to the sum of 5% of
technology transfer fee.
9.3 In the event that there is any technical error for the transferred
technology Party A shall make corrections and improve the quality promptly. If
such improvement still cannot reach the production standard, Party A shall pay
Party B penalty equal to the sum of 5% of technology transfer fee, moreover,
reimburse Party B any losses incurred arising out of or in connection therewith.
9.4 If Party B does not pay transfer fee to Party A in accordance with the time
and amount stipulated by this Agreement, Party B shall pay penalty to Party A
subject to the bank's rules with respect to deferring payment.
10. CHANGES AND DISSOLUTION OF THE AGREEMENT
10.1 Without any reasonable cause either party shall not change or terminate
this Agreement.
10.2 In the case of failure to complete the ownership transfer procedures of
"Wellness Products Certificate" as a result of the change of national policy
after the conclusion of this agreement, both parties shall have the right to
terminate this Agreement. In such case, both parties shall not bear
responsibilities for default and suffer the losses arising out of this by
themselves respectively.
11 GOVERNING LAW AND SETTLEMENT OF DISPUTE
11.1 The conclusion, validity, interpretation, implementation, amendments,
termination and settlement of dispute arising out of or in connection with this
agreement shall be governed by the laws of the PRC.
11.2 The two parties hereto shall make all reasonable efforts to solve any
dispute arising out of the implementation of this agreement through friendly
consultation. In case no settlement can be reached through consultation, the
court where Party A is located shall have jurisdiction to hear and determine the
suit subject to this written agreement.
12 OTHERS
12.1 A supplemental agreement shall be signed separately thereafter by both
parties if some other items are to be covered.
12.2 The changed parts, if there are any, shall be invalid unless they are
properly sealed and validated by both parties.
12.3 If any provision of this Agreement or part thereof is rendered void or
unenforceable, it shall not affect in any way the validity or enforceability of
any other provision of this Agreement.
12.4 The Agreement shall take effect after both parties have affixed their
respective seals under the hands of their respective officers duly authorized in
that behalf. In the event that a notarization is needed, the Agreement shall
become effective after it is notarized by public notarial authority.
This Agreement shall be executed in eight originals. Each party holds one copy
and others will be submitted to the authorized governmental department in the
course of proceeding the transfer application procedures.
IN WITNESS WHEREOF this Agreement has been entered into the day and year first
above written.
PARTY A: TIANJIN TIANSHI BIOLOGICAL DEVELOPMENT CO., LTD.
SIGNED BY /s/ Xxxxxxx Xx
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DATE October 26, 2005
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CONTACT Xxxxx Xxx
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TEL 0000-00-00000000
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FAX 0000-00-00000000
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ADD. Xx. 0, Xxxxxxxx Xxxx, Xxxxxx Xxx-xxxx Xxxxxxxxxx Xxxx, Tianjin, P.R. China
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PARTY B: TIANJIN TIANSHI BIOLOGICAL ENGINEERING CO., LTD.
SIGNED BY /s/ Xxxxxxx Xx
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DATE October 26, 2005
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CONTACT Xxxxx Xxx
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TEL 0000-00-00000000
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FAX 0000-00-00000000
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ADD. Xx. 0, Xxxxxxxx Xxxx, Xxxxxx Xxx-xxxx Xxxxxxxxxx Xxxx, Tianjin, P.R. China
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