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Loan Agreement

Loan Agreement

Loan Agreement | Document Parties: Beijing Ruijieao Bio-Technology Ltd | NeoStem (China), Inc You are currently viewing:
This Loan Agreement involves

Beijing Ruijieao Bio-Technology Ltd | NeoStem (China), Inc

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Title: Loan Agreement
Date: 7/13/2009
Industry: Healthcare Facilities     Sector: Healthcare

Loan Agreement, Parties: beijing ruijieao bio-technology ltd , neostem (china)  inc
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Exhibit 10.8

 

Loan Agreement

 

By and between

 

The Shareholder of Beijing Ruijieao Bio-Technology Ltd.

 

and

 

NeoStem (China), Inc.

 

June 1, 2009

 


 

Loan Agreement

Confidential

 

Loan Agreement

 

This Loan Agreement (this “Agreement”) is executed by and between the following Parties on June 1, 2009, in Qingdao City, the People’s Republic of China ( the “PRC”).

 

(1)  

Sole Shareholder of Beijing Ruijieao Bio-Technology Ltd. (hereinafter as the “Borrower” or “Party A”) :

 

Name of Each

Shareholder

 

Shareholding

Ratio (%)

 

ID Card No.

 

Contact Address

Fu Wenyuan

 

100

 

 

 

No.27 Shandabei Road, Licheng District, Ji’nan City

 

 (2)

NeoStem (China), Inc. (hereinafter as the “Lender” or “Party B”)

Legal Representative Robin Smith

 

Address

: Room 0425A, Building C, No.6 XiangGangZhong Road, Shinan District, Qingdao City.

(Party A and Party B are collectively called “the Parties” and individually called “each Party” or “a Party” in this Agreement.)

 

WHEREAS:

 

(1) The Borrower (Party A) hold 100% of the equity interests in Beijing Ruijieao Bio-Technology Ltd. (the “Company”);

 

(2) Party B is a wholly foreign-owned enterprise incorporated under the PRC laws;

 

(3) Party A desires to secure a loan from Party B, for the purpose of increasing the registered capital of the Company, by pledging its equity in the Company to Party B as a guaranty of the loan, and Party B agrees to provide the loan to Party A ;

 

NOW, THEREFORE,  The Parties have agreed through friendly negotiation to the terms and conditions with respect to the loan hereunder as follows:

 

1. DEFINITION

 

Except where provided otherwise, the terms used in this Agreement shall mean:

 

1.1 “PRC” refers to the People’s Republic of China, excluding the Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan Province;

 

 

1


 

 

Loan Agreement

Confidential

 

1.2 “PRC Laws” refers to all PRC laws, administrative regulations and government rules in effect;

 

1.3 “RMB” refers to the legal currency within the PRC;

 

1.4 “Loan” refers to the Total Principal to be loaned to the Borrower by the Lender in accordance with Article 2 hereunder;

 

1.5 “The Company” refers to Beijing Ruijieao Bio-Technology Ltd., a domestic company which is incorporated and validly existing under PRC Laws; its business license No. is 11010811860295, and its registered address is Room 2007 20/F, Qingyundangdai Building, No.9 Mantingfangyuan Community, Qingyun Li, Haidian District, Beijing City;

 

1.6 “Shareholder” refers to the sole Shareholders of the Company;

 

1.7 “Equity” or “Equity Interests” refers to the equity interests in the Company;

 

1.8 “Equity Transfer” refers to the assignment of Equity Interests in the Company held by Party A to Party B or its designated third party in accordance with the provisions of the exclusive purchase option agreement (the “Exclusive Purchase Option Agreement”) executed on June 1, 2009.

 

1.9 “Asset Transfer” refers to the assignment of the assets of the Company by the Company to Party B or its designated third party in accordance with the provisions of the Exclusive Purchase Option Agreement.

 

1.10 “Consideration for Equity Transfer” has the meaning set forth in Section 6 of this Agreement.

 

1.11 “Consideration for Assets Transfer” has the meaning set forth in Section 6 of this Agreement.

 

2. THE TOTAL LOAN AMOUNT

 

2.1 The total principal amount of the loan hereunder is RMB 100,000.00Yuan (the “Total Principal”), and the amount and ratio of the loan to be made to the Shareholder is as set forth in the following table:

 

Name of the

Shareholder

 

Amount of the Loan 

(Yuan)

 

 

Percentage of Total 

Principal %

 

Fu Wenyuan

 

 

100,000.00

 

 

 

100

%

 

 

2


 

 

Loan Agreement

Confidential

 

3.  TERM OF THIS AGREEMENT

 

3.1 Unless otherwise provided, the term of this Agreement shall begin from the Effective Date and expire when the loan is completely repaid by the Borrower in accordance with the provisions of Article 6 hereunder.

 

4. LOAN USAGE

 

4.1 The full amount of the loan provided hereunder shall be used to increase the registered capital of the Company, and the Borrower shall in no event change the usage without the prior written consent of the Lender.

 

4.2 The Borrower shall cause the Company to complete the registration of the Company with the competent Administration Bureau of Industry and Commerce in respect of the increase in the registered capital of the Company within thirty (30) business days upon receipt of the Loan hereunder, and such period may be prolonged upon the consent of the Lender.

 

5. LOAN INTEREST

 

5.1 Except as provided in Section 5.2 hereunder, the Loan hereunder shall be interest-free.

 

5.2 If the Consideration for Equity Transfer or the Consideration for Asset Transfer, in accordance with Section 6 hereof, is higher than the Total Principal as a result of the requirements of then applicable law or for any other reason, the excess shall be deemed to be loan interest/utilizing fees of the Loan to the largest extent permitted by PRC Laws, and will be paid to Party B by Party A together with loan principal.

 

6.  LOAN REPAYMENT

 

6.1 The Loan shall be repaid upon receipt of written notice sent by Party B to Party A (the “Repayment Notice”), which shall instruct Party A to repay the Loan in accordance with Section 6.3 hereof.

 

6.2 The Repayment Notice shall indicate the term of repayment, which shall be adjusted from time to time by Party B in accordance with the provisions of PRC Laws regarding equity transfers (the “Repayment Term”).

 

6.3 Except as provided otherwise by the Repayment Notice, Party A shall make payment to Party B during the Repayment Term as follows:

 

6.3.1 

In the event of any Equity Transfer by Party A, the after-tax consideration paid to Party A in exchange for such Equity Transfer (including the principal and interest of the loan, if applicable) (hereinafter as the “Consideration for Equity Transfer”) shall be used by Party A to repay the Loan to Party B;

 

 

3


 

 

Loan Agreement

Confidential

 

6.3.2 

In the event that the Company receives consideration for any Asset Transfer, Party A shall cause the Company to adopt a plan of profit distribution to transfer all after-tax income of the Company to Party B to the greatest extent permitted by PRC Laws, in order to repay the loan made by Party B under this agreement.

 

6.4 If the Consideration for Equity Transfer or Consideration for Asset Transfer is lower than the total principal under this Agreement, Party A shall be exempted from the shortfall repayment obligation.

 

7. CONDITONS FOR GRANTING OF THE LOAN

 

7.1 The loan shall be granted only upon satisfaction of all the following conditions:

 

7.1.1 

Party A shall approve increasing the registered capital by an amount equal to the Total Principal.

 

7.1.2 

Party A, or the Company on behalf of Party A, shall execute all documents necessary for the registration with the competent Administration Bureau of Industry and Commerce in respect of the increase of registered capital of the Company.

 

7.2 Party B shall grant the Loan immediately and deposit it in the escrow account as agreed by Party B for increasing the registered capital of the Company after it receives written evidence which proves that Party A has fulfilled all the conditions under Section 7.1 hereof.

 

8. WARRANTIES AND UNDERTAKINGS

 

8.1 Party A hereby represents and warrants to Party B that, as of the execution date of this Agreement:

 

8.1.1

Party A legally holds 100% of the Equity in the Company;

8.1.2

Except as otherwise provided in the Equity Pledge Agreement and Exclusive Purchase Option Agreement, there is no pledge or other form of encumbrance on the Equity;

 

8.1.3

There are no material debts which will adversely affect the Equity of Party A;

 

 

4


 

 

Loan Agreement

Confidential

 

8.1.4

Execution of this Agreement by Party A shall not constitute a breach of the articles of association of the Company.

 

8.2 Party A warrants to Party B that, as of the execution date of this Agreement:

 

8.2.1

Except as otherwise provided in the Equity Pledge Agreement and Exclusive Purchase Option Agreement, without Party B’s prior written consent, Party A shall not transfer, sell, mortgage or otherwise dispose of assets or income of the Company;

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