Exhibit 10.8
Loan Agreement
By and
between
The Shareholder of Beijing Ruijieao Bio-Technology Ltd.
and
NeoStem (China), Inc.
June 1, 2009
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Loan
Agreement
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Confidential
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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”).
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Sole
Shareholder of Beijing Ruijieao Bio-Technology
Ltd. (hereinafter as the “Borrower” or
“Party A”) :
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Name of Each
Shareholder
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Shareholding
Ratio (%)
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ID Card
No.
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Contact
Address
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Fu
Wenyuan
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100
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No.27 Shandabei Road, Licheng
District, Ji’nan City
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(2)
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NeoStem
(China), Inc. (hereinafter as the “Lender” or
“Party B”)
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Legal
Representative :
Robin Smith
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Address
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: Room 0425A,
Building C, No.6 XiangGangZhong Road, Shinan District, Qingdao
City.
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(Party A and
Party B are collectively called “the Parties” and
individually called “each Party” or “a
Party” in this Agreement.)
(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:
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;
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Loan
Agreement
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Confidential
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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.
2.1 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:
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Name of the
Shareholder
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Amount of the
Loan
(Yuan)
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Percentage
of Total
Principal
(
% )
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Fu
Wenyuan
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100,000.00
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100
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%
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Loan
Agreement
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Confidential
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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.
4.1 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.
5.1 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.
6.1 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:
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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;
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Loan
Agreement
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Confidential
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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.
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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:
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7.1.1
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Party A shall
approve increasing the registered capital by an amount equal to the
Total Principal.
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7.1.2
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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.
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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:
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Party A legally holds 100% of the Equity in the
Company;
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8.1.2
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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;
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8.1.3
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There are no material debts which will adversely
affect the Equity of Party A;
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Loan
Agreement
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Confidential
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8.1.4
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Execution of this Agreement by Party A shall not
constitute a breach of the articles of association of the
Company.
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8.2 Party A
warrants to Party B that, as of the execution date of this
Agreement:
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8.2.1
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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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