Stock Equity Transfer Agreement in relation to Shanxi Taizihu Food Co., Ltd. and Shanxi Huichun Bean Products Co., Ltd.

EX-10.1 2 v301599_ex10-1.htm EXHIBIT 10.1

Translation

Stock Equity Transfer Agreement

in relation to

Shanxi Taizihu Food Co., Ltd.

and

Shanxi Huichun Bean Products Co., Ltd.

Party A: He Hao; identity card No. 14621196712090054

Address: No. 402, Unit 1, Er Yun Family Block, Qu Wo Xian, Shanxi Province, China; Postal code: 043400

Party B: Xu Qinghe ; identity card No. 14262119680826221X

Address: No. 81, Nan Jie Xiang, Dong Ning Village, Shi Cun County, Qu Wo Xian, Shanxi Province, China;

Postal code: 043400

Party C: Xie Jinqing; identity card No. 142602196708210050

Address: No. 47, North 1 Hutong, Er Xiang West, Hui Bin Street, Houma City, Shanxi Province, China;

Postal code: 043000

Party D: Beijing Kanggang Food Development Co. Ltd

Legal Representative: Liu Jiming

Address: No. 168, Kangjia Gou, Jianguo East Road, Chaoyang District, Beijing, China; Posal code: 100025

Party E: Redsun Technology (Shenzhen) Co. Limited;

Legal Representative: Ding Yunlin

Address: 1stFloor, Block 96, Xia Henliang, Tongshen Community, Daliang Jie Road, Bao An District, Shenzhen City, Postal Code: 518000

Party A, Party B, Party C (together with Party D hereinafter collectively called the “Transferors”) and Party E (hereinafter called the “Transferee”) in respect of the transfers of stock equity of Shanxi Taizihu Food Co. Ltd. (hereinafter called “Taizihu”) and Party D and Party E in respect of the transfers of stock equity of Shanxi Huichun Bean Products Co., Ltd. (hereinafter called the “Huichun”), through equal, voluntary and friendly negotiations, agreed in Beijing on February 2, 2012 as follows:

Article I – Stock Equity Transfer Price and Terms of Payment

Party A shall transfer its shareholdings representing 50% in the registered share capital of Taizihu (hereinafter called the “Stock Equity”) to Party E, at the price of RMB14,773,222.

Party B shall transfer its shareholdings representing 32.5% in the registered share capital of Taizihu (hereinafter called the “Stock Equity”) to Party E, at the price of RMB9,602,594.

Party C shall transfer its shareholdings representing 17.5% in the registered share capital of Taizihu (hereinafter called the “Stock Equity”) to Party E, at the price of RMB5,170,628.

Party D shall transfer its shareholdings representing 15% in the registered share capital of Huichun (hereinafter called the “Stock Equity”) to Party E, at the price of RMB5,158,556.

Party E shall purchase the above Stock Equities at the prices mentioned above.

Upon execution of this Agreement, the Transferee shall settle payments of the above purchase prices within 15 days with the respective Transferors in respect of the transfers of the Stock Equities.

Effective signing hereof, Party E shall become the shareholder of Taizihu and Huichun respectively, and thereafter shall enjoy the profits and bear the losses of Taizihu and Huichun, in accordance with the shareholding ratio in and the provisions of the charters of Taizihu and Huichun respectively.

Article II - Warranties

The Transferors warrant that the Stock Equities to be respectively transferred to the Transferee are the authentic contributions of the Transferors to Taizihu and Huichun and are legally owned by the Transferors who possess the complete rights of ownership and disposition thereof. The Transferors further warrant that there is no mortgage, pledge or securities over the Stock Equities which are free from any third party’s recourse. The Transferors shall bear full responsibilities arising from such recourse.

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The Transferors warrant that all documents in relation to Taizihu and Huichun which they provided to the Transferee and the auditors and legal counsel engaged by the Transferee are true, accurate, complete and valid.

The Transferors warrant that the financial statements they provided to the Transferee and the auditors and legal counsel engaged by the Transferee are true, accurate and complete and other than those disclosed in the said financial statements, there are no other undisclosed liabilities or contingent liabilities and the Transferors shall bear all consequential responsibilities should this warranty be defaulted.

The Transferee and the auditors and legal counsel engaged by the Transferee shall have the obligation to keep confidential information of Taizihu and Huichun obtained from Taizihu and Huichun and the Transferee herein warrants not to disclose such confidential information, without the permission of the Taizihu and Huichun, to third parties other than to agents, consultants, legal counsel and auditors engaged by the Transferee, save and except disclosure of such confidential information is required by relevant rules and regulations applicable to the Transferee or is required in response to valid orders of court of competent jurisdiction or authorized government agency.

The Transferors warrant that Taizihu and Huichun did not incur any claim and/or debt and did not distribute dividends during the course of negotiation of the transfers of Stock Equities (i.e. between December 31, 2011 and the date of closing of the transfers of the Stock Equities), other than those incurred in the ordinary course of business.

Upon completion of the transfers of the said Stock Equities, the original entitlements and due obligations therein shall be simultaneously transferred to the Transferee.

The Transferors acknowledge the charters of Taizhu and Huichun and warrant that they shall execute their obligations and responsibilities in accordance with the charters.

The Transferors warrant that they shall complete formalities with relevant government authorities for the transfers of the Stock Equities.

Article III –Profit and Loss Sharing

Prior to the completion of the transfers of the Stock Equities, the Transferors shall be entitled to the profits and shall bear the losses of Taizihu and Huichun respectively and after the completion of the transfers of the Stock Equities, the profits and losses thereof shall be respectively enjoyed and borne by the Transferee.

Article IV – Obligations of Management

Party A, Party B and Party C as the original shareholders and the Management of Taizihu and Huichun (hereinafter called the “Management”) shall upon closing of the transfer of Stock Equities, diligently and responsibly perform duties of daily operations and management of Taizihu and Huichun, as follows:

The Management shall ensure normal business operations of Taizihu and Huichun being carried out and marketing channels, intellectual properties (including trade-marks, patents, patented technology, processing techniques, etc.) operated before the closing of the transfers of Stock Equities being continuously operated as effectively as before the closing of the transfers of Stock Equities.

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The Management by itself or via third parties shall not carry on business operations similar to the business operations of Taizihu and Huichun and shall not assist third parties to carry on business operations competing with those of Taizihu and Huichun.

The Management shall be obliged to keep confidential information of Taizihu and Huichun (including customer base, suppliers, intellectual properties, financial data, etc.).

The Management warrants that the financial results (audited revenue and net profit), after closing of the transfers of Stock Equities, for the first half year of 2012, shall not be worse than the average financial results of the corresponding periods of years 2010 and 2011.

The Management agrees to the Transferee’s retaining a total of RMB2 million out of the purchase prices as the surety for the performance of the obligations Management and the retained amount shall be released to the Management upon the above conditions being satisfied.

Article V - Expenses Sharing

Expenses arising from the transfers of the Stock Equities shall be borne by the Transferors and Transferee jointly.

Article VI - Resolutions on disputes

Any dispute related to the validity, performance, breach or termination of this Agreement shall be resolved by all the parties through friendly negotiation. If the dispute remains unsettled, it shall be subject to the jurisdiction of the People’s Court in Beijing.

Article VII - Supplement

This Agreement shall be executed in 10 copies each of which shall possess the same legal validity. Each of Parties A, B, C, D and E shall retain one original executed copy, each of Taizihu and Huichun shall retain one original executed copy and the remaining counterparts shall be submitted to the relevant government authorities. This Agreement shall become effective upon being sealed by or signed by the respective authorized representatives of all the parties hereto.

Party A :