ACQUISITION AGREEMENT
THIS ACQUISITION AGREEMENT (the "Agreement") is
made and entered as of March 25, 2009, by and among Qufu Natural
Green Engineering Co., Ltd., a limited liability company organized
under the laws of the Peoples Republic of China
(“Buyer”), Qufu Shengren Pharmaceutical Co., Ltd., a
limited liability company organized under the laws of the Peoples
Republic of China (“Qufu Shengren”), and the
shareholders of Qufu Shengren listed on the signature page to this
Agreement (the “Shareholders”).
RECITALS
A. Qufu Shengren is a
limited liability company organized under the laws of the Peoples
Republic of China.
B. The Shareholders
own an interest in Qufu Shengren in an amount listed next to their
name on the signature page to this Agreement and collectively own
and hold a 100% interest in Qufu Shengren (the “Qufu Shengren
Interest”).
C. Buyer desires to acquire the Qufu
Shengren Interest and the Shareholders desire to sell to Buyer
their interest in Qufu Shengren for a total price of $3,097,242,
which represents 100% of the value of the net tangible assets of
Qufu Shengren as of December 30, 2008 as determined by an
independent asset appraiser in accordance with government-issued
assets appraisal principles in China. Buyer will acquire
such Qufu Shengren Interest in exchange for cash at Closing (the
“Cash Consideration”), as hereinafter defined and in
accordance with the terms and conditions set forth in this
Agreement.
D. Qufu Shengren is doing business in
China and related territories with the following
address:
NOW, THEREFORE, in consideration of the mutual
covenants, agreements, representations and warranties contained in
this Agreement, the parties hereto agree as follows:
Subject to the terms and conditions of this
Agreement, Buyer shall acquire the Qufu Shengren Interest for a
total consideration of $3,097,242 in cash, which amount represents
100% of the value of the net tangible assets of Qufu Shengren as of
December 30, 2008 as determined by an independent asset appraiser
in accordance with government-issued assets appraisal principles in
China, payable in cash at Closing (the “Purchase
Price”). The purchase price shall be paid to the
Shareholders in proportion to their ownership interest in Qufu
Shengren as set forth on the signature page to this
Agreement.
a. The closing
shall take place not later than April 30, 2009 (the
“Closing”). The parties agree that, subject
to the Closing, the acquisition of the Qufu Shengren shall be
effective as of March 25, 2009.
b. Procedure at
the Closing . At the Closing, the parties agree to
take the following steps in the order listed below (provided,
however, that upon their completion all of these steps shall be
deemed to have occurred simultaneously):
(i) Buyer and/or an affiliate of
Buyer as determined by Buyer shall deliver the Purchase Price to
Qufu Shengren; and
(ii) The Shareholders will transfer
their 100% interest in Qufu Shengren to Buyer by delivery of the
Qufu Shengren Interest and execution of such documentation as may
be reasonably requested by Buyer.
3.
REPRESENTATIONS AND WARRANTIES
OF QUFU SHENGREN AND THE SHAREHOLDERS
Qufu Shengren and the Shareholders hereby
represent and warrant as follows:
a. Organization
and Good Standing and Ownership of Qufu Shengren
. Qufu Shengren is duly organized, validly existing and
in good standing under the laws of the Peoples Republic of China,
and is entitled to own or lease its properties and to carry on its
business in the places where such properties are now owned, leased
or operated and as such business is now conducted. Qufu
Shengren is duly licensed or qualified and in good standing as a
Chinese company of limited liabilities where the character of the
properties owned by it or the nature of the business transacted by
it make such licenses or qualifications necessary. There
are no outstanding subscriptions, rights, options, warrants or
other agreements obligating either Qufu Shengren to issue, sell or
transfer any ownership interest in Qufu Shengren or an ownership of
the assets of Qufu Shengren. The Shareholders have no
relationship with Buyer and its parent company Sunwin International
Neutraceuticals, Inc., a Nevada corporation or its executive
officers or directors.
a. Asset Appraisal
Report, Books and Records . Qufu Shengren has
delivered to Buyer the assets appraisal report and schedules of
fixed assets of Qufu Shengren as of December 30, 2008 as determined
by an independent asset appraiser in accordance with
government-issued assets appraisal principles in China (the "Qufu
Shengren Asset Appraisal "). The Qufu Shengren Asset
Appraisal is true and accurate and fairly represents the value of
the assets of Qufu Shengren as of December 30, 2008, and has been
prepared in accordance with government-issued assets appraisal
principles in China. Since December 30, 2008 there have
been no material changes in the assets of Qufu Shengren.
b. Taxes
. Qufu Shengren has prepared and filed all appropriate
tax returns for all periods prior to and through the date hereof
for which any such returns have been required to be filed by it and
has paid all taxes shown to be due by said returns or on any
assessments received by it or has made adequate provision in its
financial statements for the payment thereof.
c. Compliance with
Laws . Qufu Shengren has complied with all
applicable laws, ordinances, regulations, inspections, orders,
judgments, injunctions, awards or decrees applicable to it or its
business which, if not complied with, would materially and
adversely affect the business of Qufu Shengren. Qufu
Shengren shall obtain the necessary approvals from the respective
regulatory authority and shall provide such valid license to
Buyer.
d. Authority to
Execute and Perform Agreements . Qufu Shengren and
the Shareholders have the full legal right and power and all
authority and approval required to enter into, execute and deliver
this Agreement and to perform fully their obligations
hereunder. This Agreement has been duly executed and
delivered and is the valid and binding obligation of , enforceable
in accordance with its terms, except as may be limited by
bankruptcy, moratorium, insolvency or other similar laws generally
affecting the enforcement of creditors' rights. The
execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby and the performance by this
Agreement, in accordance with its respective terms and conditions
will not:
i. require the
approval or consent of any governmental or regulatory body, or the
approval or consent of any other person;
ii. conflict with or
result in any breach or violation of any of the terms and
conditions of, or constitute (or with any notice or lapse of time
or both would constitute) a default under, any order, judgment or
decree applicable to Qufu Shengren or the Shareholders, or any
instrument, contract or other agreement to which is a
party or by or to which is bound or subject;
or
iii. result in the
creation of any lien or other encumbrance on the assets or
properties of Qufu Shengren or the Shareholders.
e. Actions and
Proceedings . There is no outstanding order,
judgment, injunction, award or decree of any court, governmental or
regulatory body or arbitration tribunal against or involving Qufu
Shengren.
f. Tangible
Assets . Qufu Shengren has full title and interest
in all machinery, equipment, furniture, leasehold improvements,
fixtures, vehicles, structures, owned or leased by Qufu Shengren,
any related capitalized items or other tangible property material
to the business of Qufu Shengren and as set forth in the Qufu
Shengren Asset Appraisal and as set forth on Schedule A attached
hereto (the "Qufu Shengren Assets"). Qufu Shengren holds
all rights, title and interest in all the Qufu Shengren Assets
owned by it or acquired by it after the date of the Qufu Shengren
Asset Appraisal, free and clear of all liens, pledges, mortgages,
security interests, conditional sales contracts or any other
encumbrances.
g. Liabilities
. Qufu Shengren do
