FRES Fresh2 Group Ltd

 

U.S. SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of July 2023

 

Commission File Number: 001-39137

 

Fresh2 Group Limited

 

650 5TH AVE STE 2416

NEW YORK, NY 10019-6108

United States

(Address of principal executive office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F ☒   Form 40-F ☐

 

 

 

Entry Into Material Definitive Agreements

 

On May 24th, 2023, Fresh2 Group Limited (the “Company” or “Registrant”), through its subsidiary Foodbase Group Inc. (“Foodbase”) entered into an Interest Purchase Agreement with Mr. Haohan Xu (“Mr. Xu”), the CEO of the Company, and Nassau Enterprises LLC, a Delaware limited liability company (“Nassau”), of which Mr. Xu was the sole member, manager and CEO, whereby Foodbase purchased 19.64% of the membership interests in Nassau from Mr. Xu for one dollar. The transaction closed on May 24th, 2023. After the closing, Mr. Xu holds 8,036 voting units in Nassau, representing 80.36% of the outstanding membership interests in Nassau.

 

On May 24th, 2023, Foodbase entered into an Amended and Restated Operating Agreement with Nassau and Mr. Xu, whereby Foodbase agreed to contribute $5,500,000 in cash to Nassau, provided that Nassau will complete the purchase of 100% equity interests in SLV Windfall Group LLC, Windfall SLV Development LLC and SLV Windfall Management, LLC, respectively.

 

 

EXHIBIT INDEX

 

Exhibit		Description
10.1		Interest Purchase Agreement dated May 24, 2023.
10.2		Amended and Restated Operating Agreement dated May 24, 2023

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

	Fresh2 Group Limited
	By:	/s/ Haohan Xu
	Name:	Haohan Xu
	Title:	Chief Executive Officer
Dated: July 7, 2023

 

 

3

Exhibit 10.1

 

INTEREST PURCHASE AGREEMENT

 

THIS INTEREST PURCHASE AGREEMENT (the “Agreement”) is made and entered into as of May 24^th, 2023 by and among

 

(1) Haohan Xu, as the selling member of Nassau Enterprises LLC (“Seller”);

 

(2) Nassau Enterprises LLC, a company incorporated in Delaware (the “Company”); and

 

(3) Foodbase Group Inc., a Delaware Corporation (the “Purchaser”)

 

Each of the Purchaser, the Seller and the Company are referred to as a “Party” and collectively as “Parties.”

 

WHEREAS, the Seller desires to sell, and Purchaser desires to purchase 19.64% of the membership interests of the Company (“Purchased Interests”), for the consideration and on the terms and conditions set forth in this Agreement; and

 

WHEREAS, as consideration for the purchase of the Company’s interests, the Purchaser desires

to pay one dollar to the Seller.

 

NOW, THEREFORE, in consideration of the mutual promises made in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree as follows:

 

1. DEFINITIONS

 

The following terms used in this Agreement shall be construed to have the meaning set forth or referenced below.

 

“Affiliates”

means, with respect to any specified Person, any other Person who or which, directly or indirectly, Controls, is Controlled by, or is under common Control with such specified Person, including, without limitation, any officer, director, employee, member, partner or shareholder of such Person and any venture capital fund now or hereafter existing that is Controlled by or under common Control with one or more general partners or managing members of, or shares the same management company with, such Person;

 

“Agreement”

means this Interest Purchase Agreement;

 

“Board”

means the board of directors of the Purchaser;

 

 

“Charter Documents”

means to a Person, such Person’s memorandum and articles of association, certificate or articles of incorporation, by-laws, partnership agreement, joint venture agreements, formation agreement, limited liability company agreement and other organizational documents;

 

“Closing”

has the meaning given to it in Section 2.3(a);

 

“Company”

has the meaning given to it in the preamble of this Agreement;

 

“Company Intellectual Property”

means all patents, patent applications, trademarks, trademark applications, service marks, tradenames, copyrights, trade secrets, licenses, domain names, software, information and proprietary rights and processes as are necessary to the conduct of Company’s business as now conducted in all material respects;

 

“Confidential Information”

has the meaning given to it in Section 10.1;

 

“Control”

means the possession, directly or indirectly, of the power to direct or cause the direction of the management of a Person, whether through the ownership of voting securities, by contract, credit arrangement or proxy, as trustee, executor, agent or otherwise. For the purpose of this definition, a Person shall be deemed to Control another Person if such first Person, directly or indirectly, owns or holds more than fifty percent (50%) of the voting power in such other Person.

 

“Controlled”

has the meaning correlative to the foregoing;

 

“Disclosing Party”

has the meaning given to it in Section 10.4;

 

“Governmental Authority”

means (a) any nation or government or any nation, federal, state, province, municipality, local, autonomous region or any other political subdivision thereof; (b) any entity, authority or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government and any government authority, agency, department, board, commission or instrumentality or any political subdivision thereof, including any entity or enterprise owned or controlled by a government or a public international organization; or (c) any court, tribunal or arbitrator;

 

“Group”

means, collectively, the Company, and its direct or indirect Subsidiaries of the Company;

 

“Group Company”

means any member of the Group, individually;

 

 

“Group Material Adverse Effect”

means a material adverse effect on the business, assets (including intangible assets), liability, financial condition, property, prospects or results of operations of the Company, taken as a whole;

 

“Indemnified Person”

has the meaning given to it in Section 9.2;

 

“Indemnifying Person”

has the meaning given to it in Section 9.2;

 

“Key Employee”

means any executive-level employee (including division director and vice president-level positions);

 

“Knowledge”

means (i) with respect to the Seller, actual knowledge of executive-level employees of the Group; or (ii) with respect to the Company, actual knowledge of executive-level employees of the Company;

 

“Law”

means any statute, law, ordinance, regulation, rule, code, order, requirement or rule of law (including common law), official policy, rule or interpretation of any Governmental Authority with jurisdiction over the Group Companies, as the case may be;

 

“Lien”

means any mortgage, pledge, deed of trust, hypothecation, right of others, claim, security interest, encumbrance, burden, title defect, title retention agreement, lease, sublease, license, occupancy agreement, easement, covenant, condition, encroachment, voting trust agreement, charge, option, right of first offer, negotiation or refusal, proxy, lien, charge, adverse claim or other restrictions (including restrictions on transfer), or limitations of any nature whatsoever, including such liens as may arise under any contract;

 

“Party”

has the meaning given to it in the preamble of this Agreement;

 

“Person”

means any individual, corporation, partnership, trust, limited liability company, company limited by shares, unincorporated association or other entity;

 

“Public Official”

has the meaning given to it in Section 3.12(a);

 

 

“Purchaser”	has the meaning given to it in the preamble of this Agreement;
“Purchaser’s Advisors”	has the meaning given to it in Section 5.1;
“Purchaser’s Material Adverse Effect”	means a material adverse effect on the business, assets (including intangible assets), liabilities, financial condition, property, prospects or results of operations of the Purchaser’s
“SEC”	has the meaning given to it in Section 4.7(a);
“SEC Documents”	has the meaning given to it in Section 4.7(a);
“Securities Act”	means the United States Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder;
“Seller”	has the meaning given to it in the preamble of this Agreement;
“Purchased Interests”	means 19.64% of the membership interests of the Company;
“Subsidiary”	of any Person means any other Person of which at least fifty percent (50%) of the outstanding voting securities or other voting equity interests are owned, directly or indirectly, by such first Person and, for the avoidance of doubt, shall include any variable interest entity over which such Person or any of its subsidiaries effects Control pursuant to contractual arrangements and which is consolidated with such Person in accordance with generally accepted accounting principles applicable to such Person;
“Tax” or “Taxes”	means any and all national, federal, state, provincial, municipal and local taxes of any country, assessments and other governmental charges, duties, impositions and liabilities, including taxes based upon or measured by gross receipts, income, profits, capital gains, sales, use and occupation, and value added, ad valorem, stamp transfer, franchise, building, vehicle, land use, land appreciation, city and rural construction, tariff, withholding, payroll, recapture, employment, additional education, excise and property taxes, adjustment taxes, together with all interest, penalties and additions imposed with respect to such amounts and any obligations under any agreements or arrangements with any other Person with respect to such amounts and including any liability for taxes of a predecessor entity;

 

 

“Tax Return”	means any return, report declaration, filing form, claim for refund or information return or statement relating to Tax, including any schedule or attachment thereto and any amendment thereof.
“Third-Party Claim”	means any claim against any Indemnified Person by a third party;
“Transaction Documents”	means this Agreement, any registration rights agreement and all other agreements, instruments or documents entered into in connection with this Agreement;
“Transactions”	means the transactions contemplated by the Transaction Documents;
“US GAAP”	means the generally accepted accounting principles in the United States;

 

2. PURCHASE AND SALES OF INTERESTS

 

2.1 Purchased Interests.

 

Subject to the terms and conditions of this Agreement, and in reliance upon the representations, warranties, and covenants in this Agreement, at the Closing, the Purchaser shall purchase 19.64% of the membership interests of the Company from Seller, and Seller shall sell and transfer the Purchased Interest held by him to the Purchaser.

 

2.2 Consideration.

 

The consideration for the Purchased Interests shall be one dollar.

 

2.3 Closing.

 

(a) The purchase and sale of the Purchased Interests shall take place on the effective date of this Agreement (the “Closing”).

 

(c) At the Closing, in addition to the fulfillment of all conditions set forth in Section 6 of this Agreement, the Seller shall deliver to the Purchaser an updated operating agreement of the Company after giving effect to the transfer of Purchased Interests of the Company to the Purchaser at the Closing.

 

 

3. REPRESENTATIONS AND WARRANTIES OF THE SELLER

 

Each of the Seller hereby represents and warrants to the Purchaser that the following representations are true and complete as of the date hereof and will be true and correct as of the date of the Closing, except as otherwise indicated.

 

3.1 Authorization.

 

Each Seller represents and warrants that he/she/it is legally competent to enter the Transaction Documents to which the Seller is a party. The Transaction Documents to which the Seller is a party, when executed and delivered by the Seller, will constitute valid and legally binding obligations of the Seller, enforceable in accordance with their terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other laws of general application affecting enforcement of creditors’ rights generally, and as limited by Laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

 

3.2 Intentionally reserved.

 

3.3 Corporate Power and Qualification.

 

The Company is a private company duly organized, validly existing under the laws of the State of Delaware and has all requisite corporate power and authority to own, lease and operate its assets and carry on its business as presently conducted. The Company is duly qualified to transact business and is in good standing as a foreign company in each jurisdiction in which it owns or leases property or conducts any business so as to require such qualification, except for those jurisdictions where the failure to be so qualified and in good standing would not individually or in the aggregate have a Group Material Adverse Effect. None of the activities, agreements, commitments, obligations or rights of the Company is ultra vires, unauthorized or in violation of its Charter Documents or any applicable Laws. The Company has not given any powers of attorney in force, and there are no outstanding authorities, express or implied by which any Person may enter into any contract or commitment to do anything outside the ordinary course of business on its behalf.

 

3.4 Capitalization of the Company.

 

Each Seller is the registered owner of the Purchased Interests of the Company, and all Purchased Interests are validly issued, fully paid and nonassessable. The Purchased Interests to be acquired by the Purchaser as of the Closing will be free and clear of all Liens.

 

 

3.5 Compliance with Laws and Other Instruments.

 

The Seller and the Company are in compliance with all applicable Laws in all aspects, except for that noncompliance where the failure to do so would not individually or in the aggregate have a Group Material Adverse Effect.

 

The Company is not in violation of its Charter Documents or equivalent constitutive documents as in effect.

 

3.6 Governmental Consents and Filing.

 

Assuming the accuracy of the representations made by the Purchaser in Section 4 of this Agreement, no consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any national, provincial, municipal, local, autonomous region and Governmental Authority is required on the part of any Group Company in connection with the consummation of the Transactions.

 

3.7 Financial Statements.

 

To the knowledge of each Seller, the financial statements of the Company fairly present the financial condition and the results of operations in all material aspects as at the date of and for the period referred to in such financial statements, all in accordance with US GAAP.

 

3.8 Enforceability.

 

The Transaction Documents, when executed and delivered by the Seller, shall constitute valid and legally binding obligations of them, enforceable against the Seller in accordance with their respective terms, except in each case as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other Laws of general application affecting enforcement of creditors’ rights generally, and as limited by Laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

 

3.9 No Insolvency.

 

(a) No order has been made, or petition presented, or resolution passed for the winding-up of any Group Company.

 

(b) No Group Company is insolvent.

 

(c) There are no circumstances which would entitle any Person to successfully present a petition for the winding-up or administration of any Group Company or to appoint a receiver over the whole or any part of the undertaking or assets of any Group Company.

 

 

3.11 Anti-Bribery, Anti-Corruption, Anti-Money Laundering and Sanctions.

 

(a) To the knowledge of each Seller, no Group Company or any officer, director, employee, agent, representative, consultant or any other Person associated with or acting for or on behalf of any Group Company, has offered, paid, promised to pay, or authorized the payment of any money, or offered, given a promise to give, or authorized the giving of anything of value, to any officer or employee or other Person acting in an official capacity for or on behalf of any Governmental Authority (including any entity or enterprise owned or controlled by a government), to any political party or official thereof or to any candidate for political office (or to any Person where a Group Company, its officer, director, employee, agent, representative, consultant or any other Person associated with or acting for or on behalf of the Group Company knew or was aware of a high probability that all or a portion of such money or thing of value would be offered, given or promised, directly or indirectly, to any of the foregoing) (a “Public Official”) for the purposes of:

 

(i) (x) influencing any act or decision of such Public Official, (y) inducing such Public Official to do or omit to do any act in violation of the lawful duty of such Public Official, or (z) securing any improper advantage; or

 

(ii) inducing such Public Official to use his or its influence with any Government Authority to affect or influence any act or decision of such Government Authority, in order to assist any Group Company in obtaining or retaining business for or with, or directing business to any Group Company.

 

(b) None of the officers, directors, employees, agents, representatives and consultants of, and none of the beneficial owners of any interest in, any Group Company is a Public Official.

 

3.12 No Litigation.

 

There is no material claim, action, suit, proceeding, arbitration, complaint, charge or investigation pending or, to the knowledge of each Seller, currently threatened against the Company. There is no material action, suit, proceeding or investigation by any Group Company pending or which any Group Company intends to initiate. There is no claim, action, suit, proceeding, arbitration, complaint, charge or investigation pending against the Seller that challenges, or could have the effect of preventing, delaying, making illegal, imposing limitations or conditions on, or otherwise interfering with, the Transactions.

 

4. REPRESENTATION AND WARRANTIES OF THE PURCHASER

 

The Purchaser hereby, represents and warrants to the Seller that the following representations are true and complete as of the date hereof and will be true and correct as of the date of the Closing, except as otherwise indicated.

 

4.1 Internationally Reserved.

 

 

4.2 Authorization.

 

The Purchaser has full power and authority to enter into the Transaction Documents. The Transaction Documents to which the Purchaser is a party, when executed and delivered by the Purchaser, will constitute valid and legally binding obligations of the Purchaser, enforceable in accordance with their terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other Laws of general application affecting enforcement of creditors’ rights generally, and as limited by Laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

 

4.3 Compliance with Laws and Other Instruments.

 

The Purchaser is in compliance with all applicable Laws in all aspects, except for those noncompliance where the failure to do so would not individually or in the aggregate have a Purchaser’s Material Adverse Effect. Except as otherwise disclosed in the SEC Documents, The Purchaser is not in violation of its Charter Documents or equivalent constitutive documents as in effect.

 

4.3 Governmental Consents and Filings.

 

Assuming the accuracy of the representations made by the Seller in Section 3 of this Agreement, except as required by the applicable securities laws, no consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any national, provincial, municipal, local, autonomous region and Governmental Authority is required on the part of the Purchaser in connection with the consummation of the Transactions.

 

4.4 No Litigation.

 

Except as otherwise disclosed in the SEC Documents, (1) there is no material claim, action, suit, proceeding, arbitration, complaint, charge or investigation pending or, to the knowledge of the Purchaser, currently threatened against the Purchaser, and (2) there is no material action, suit, proceeding or investigation by the Purchaser pending or which the Purchaser intends to initiate. There is no claim, action, suit, proceeding, arbitration, complaint, charge or investigation pending against the Purchaser that challenges, or could have the effect of preventing, delaying, making illegal, imposing limitations or conditions on, or otherwise interfering with, the Transactions.

 

4.5 Enforceability.

 

The Transaction Documents, when executed and delivered by the Purchaser, shall constitute valid and legally binding obligations of such Party, enforceable against such Party in accordance with their respective terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other Laws of general application affecting enforcement of creditors’ rights generally, and as limited by Laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

 

 

4.6 No Insolvency.

 

(a) The Purchaser is not insolvent.

 

(b) There are no circumstances which would entitle any Person to successfully present a petition for the winding-up or administration of the Purchaser or to appoint a receiver over the whole or any part of the undertaking or assets of the Purchaser.

 

5. COVENANTS AND AGREEMENTS OF THE SELLER

 

5.1 Access and Investigation.

 

Between the date of this Agreement and the Closing, the Seller and the Company will and will cause each Group Company to, (a) afford the Purchaser and its representatives and prospective lenders and their representatives (collectively, the “Purchaser’s Advisors”) full and free access to each Group Company’s personnel, properties, contracts, books and records, and other documents and data, (b) furnish the Purchaser and each Purchaser’s Advisors with copies of all such contracts, books and records, and other existing documents and data as the Purchaser may reasonably request, and (c) furnish the Purchaser and the Purchaser’s Advisors with such additional financial, operating, and other data and information as the Purchaser may reasonably request.

 

5.2 Operation of the Group Business.

 

Between the date of this Agreement and the Closing, the Seller shall and shall cause the Company and each Group Company to:

 

(a) conduct the business of each Group Company only in accordance with its ordinary course of business consistent with past practices;

 

(b) pay its and its Group Companies’ debts and Taxes when due;

 

(c) pay or perform other material obligations when dues;

 

(d) use their best efforts to preserve intact the current business organization of each Group Company, keep available the services of the current officers, directors, employees, agent, representative and consultants of each Group Company, and maintain the relations and good will with suppliers, customers, landlords, creditors, employees, agents, and others having business relationships with each Group Company;

 

(e) confer with the Purchaser concerning operational matters of a material nature;

 

(f) maintain the assets owned or used by each Group Company in a state of repair and condition that complies with Law and contracts and is consistent with the requirements and normal conduct of the business of that Group Company; and

 

(g) maintain all records of each Group Company consistent with past practice.

 

 

5.3 Negative Covenants.

 

Except as otherwise expressly permitted by this Agreement, between the date of this Agreement and the Closing, the Seller shall, and shall cause the Company and the Group Companies not to, without the prior consent of the Purchaser:

 

(a) cause or permit any amendment or modification of the Charter Documents of any Group Company;

 

(b) declare or any pay dividends on or make any other distributions (whether in cash, stock or property) in respect of any of its or any of its Group Companies’ capital stock or share capital, or split, combine or reclassify any of its capital stock or share capital or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares or interests of its capital stock or share capital, or repurchase or otherwise acquire, directly or indirectly any shares or interests of its or its Group Companies’ capital stock or share capital, except from former employees, directors and consultants in accordance with agreements in effect prior to the date hereof providing for the repurchase of shares or interests in connection with any termination of service from it or its Group Companies;

 

(c) issue, deliver or sell, or authorize or propose the issuance, delivery or sale of, or purchase or propose the purchase of, any shares or interests of its or its Group Companies’ capital stock or share capital or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it or its Group Companies to issue any such shares or interests or other convertible securities;

 

(d) transfer to any Person or entity any rights to the Company Intellectual Property, other than non-exclusive licenses granted to customers in the ordinary course of business consistent with past practices;

 

(e) enter into or amend any agreements pursuant to which any other party is granted exclusive marketing or other exclusive rights of any type or scope with respect to any Company Intellectual Property;

 

(f) incur any indebtedness for borrowed money, or guarantee any such indebtedness, or issue or sell any debt securities or guaranty of any debt securities of others;

 

(g) enter into, terminate or amend, in a manner that would be reasonably expected to adversely affect the business of any Group Companies any agreement relating to the license, transfer or other disposition or acquisition of Company Intellectual Property rights or rights to any material contracts that are outside of the ordinary course of business;

 

(h) make any capital expenditures, capital additions or capital improvements, outside of the ordinary course of business;

 

(i) acquire or agree to acquire by merging with, or by purchasing a substantial portion of the stock or assets of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets that are material, individually or in the aggregate, to its business or the business of any of its Group Companies;

 

 

(j) revalue any of its or its Group Companies’ assets, other than in the ordinary course of business, consistent with past practice, or as required by changes in the applicable accounting standards; or

 

(k) other than in the ordinary course of business, make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, file any Tax Return or any amendment to a Tax Return, enter into any closing agreement, settle any claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes.

 

5.4 Required Approvals.

 

As promptly as practicable after the date of this Agreement, and in any event within the applicable time period prescribed by Law, the Seller shall, and shall cause each Group Company and each of their Affiliates to, make all filings and notifications required by Law to be made by them in connection with the Transactions, if any. The Seller shall, and shall cause each Group Company and each of their Affiliates to, cooperate with the Purchaser and its Affiliates with respect to all filings and notifications that are required by Law to be made in connection with the Transactions.

 

5.5 Notification.

 

Between the date of this Agreement and the Closing, the Seller will promptly notify the Purchaser in writing if the Seller become aware of any fact or condition that causes or constitutes a breach of the Seller and warranties as set forth in Section 3, or if the Seller becomes aware of the occurrence after the date of this Agreement of any fact or condition that would (except as expressly contemplated by this Agreement) cause or constitute a breach of any such representation or warranty had such representation or warranty been made as of the time of occurrence or discovery of such fact or condition. During the same period, the Seller will promptly notify the Purchaser of the occurrence of any breach of any covenant of the Seller in this Section 5 or of the occurrence of any event that may make the satisfaction of the conditions in Section 6 impossible or unlikely.

 

5.6 Best Efforts.

 

Between the date of this Agreement and the Closing, the Seller shall, and shall cause each Group Company to, use its best efforts to take, or cause to be taken, all actions, and to do, or cause to be done and cooperate with each other to do, all things necessary, proper or advisable to perform all of the obligations set forth in Section 5 and cause the conditions in Section 6 to be satisfied. The Seller shall, and cause each of its Affiliates to, exert best efforts to take, or cause to be taken, all actions, and to do, or cause to be done all things reasonably necessary, proper or advisable under applicable laws or otherwise to obtain all consents, approvals or conditions, if any, that may be required before the Closing. The Seller shall cooperate as requested by the Purchaser to obtain all such consents, approvals or conditions.

 

 

6. CONDITIONS TO THE PURCHASER’S OBLIGATIONS AT CLOSING

 

The obligations of the Purchaser to purchase Purchased Interests of the Company at the Closing are subject to the fulfilment, on or before such Closing, of each following condition, unless otherwise waived:

 

6.1 Representations and Warranties.

 

The representations and warranties of the Seller contained in Section 3 shall be true, correct and complete in all material respects as of such Closing, except where such breach of representations and warranties, individually or in the aggregate, could not reasonably be expected to result in a Group Material Adverse Effect.

 

6.2 Performance.

 

Each Seller and Group Company shall have performed and complied with, in all material respects, all covenants, agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by the Company on or before such Closing.

 

6.3 Transaction Documents.

 

Each Seller shall have delivered to the Purchaser all Transaction Documents, duly executed, to which he, she or it, as applicable, is a party.

 

7. CONDITIONS OF THE SELLER’S OBLIGATIONS AT CLOSING

 

The obligations of the Seller to sell Purchased Interests of the Company held by the Seller at the Closing are subject to the fulfillment, on or before such Closing, of each following condition, unless otherwise waived:

 

7.1 Representations and Warranties.

 

The representations and warranties of the Purchaser contained in Section 4 shall be true, correct and complete in all material respects as of such Closing, except where such breach of representations and warranties, individually or in the aggregate, could not reasonably be expected to result in a Purchaser’s Material Adverse Effect.

 

 

7.2 Performance.

 

The Purchaser shall have performed and complied with, in all material respects, all covenants, agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by them on or before such Closing.

 

7.3 Transaction Documents.

 

The Purchaser shall have delivered to each Seller all Transaction Documents, duly executed, to which it, he or she, as applicable, is a party.

 

8. TERMINATION

 

8.1 Termination Events.

 

This Agreement and any Transaction Document may, be notice given prior to or at the Closing, be terminated:

 

(a) by either the Purchaser or the Seller if a material breach of any provision of this Agreement has been committed by another Party and such breach has not been waived or rectified within thirty (30) days after the breach; or

 

(b) by mutual consent of the Purchaser and each of the Seller.

 

8.2 Effect of Termination.

 

Each Party’s right of termination under Section 8.1 is in addition to any other rights it may have under this Agreement or otherwise, and the exercise of a right of termination will not be an election of remedies. If this Agreement is terminated pursuant to Section 8.1, all further obligations of the Parties under this Agreement will terminate; provided, however, that if this Agreement is terminated by a Party because of the breach of the Agreement by another Party or because one or more of the conditions to the terminating Party’s obligations under this Agreement is not satisfied as a result of another Party’s failure to comply with its obligations under this Agreement, the terminating Party’s right to pursue all legal remedies will survive such termination unimpaired.

 

9. INDEMNIFICATION AND REMEDIES

 

9.1 Survival.

 

(a) All representations, warranties, covenants, and obligations in this Agreement, and any certificate, document, or other writing delivered pursuant to this Agreement will survive for one (1) year after the Closing and the consummation and performance of the Transactions. The covenants and other agreements of each Party contained in this Agreement shall survive the Closing until fully discharged in accordance with their terms, except for those covenants and agreements which shall be complied with or discharged prior to the Closing in accordance with the terms of this Agreement.

 

 

(b) If written notice of a claim for indemnification has been given in accordance with this Section 9.2 prior to the time at which the applicable representations, warranties, covenants or other agreements would otherwise terminate pursuant to the foregoing, then the relevant representations, warranties, covenants or other agreements shall survive such time as to such claim, until such claim has been finally resolved.

 

(c) The waiver of any condition relating to any representation, warranty, covenant, or obligation will not affect the right to indemnification, payment, reimbursement, or other remedy based upon such representation, warranty, covenant, or obligation.

 

9.2 Indemnification.

 

From and after the date of the Closing, each Party, as applicable (the “Indemnifying Person”), shall indemnify and hold the other relevant Parties and their respective directors, officers and agents (collectively, the “Indemnified Person”) harmless from and against any losses, claims, damages, liabilities, judgments, fines, obligations, expenses and liabilities of any kind or nature whatsoever, including but not limited to any investigative, legal and other expenses incurred in connection with, and any amounts paid in settlement of, any pending or threatened legal action or proceeding, and any taxes or levies that may be payable by such person by reason of the indemnification of any indemnifiable loss hereunder (collectively, “Losses”) resulting from or arising out of: (i) the breach of any representation or warranty of the Indemnifying Person contained in the Transaction Documents, or (ii) the violation or nonperformance, partial or total, of any covenant or agreement of the Indemnifying Person contained in the Transaction Documents. In calculating the amount of any Losses of an Indemnified Person hereunder, there shall be subtracted the amount of any insurance proceeds and third-party payments received by the Indemnified Person with respect to such Losses, if any.

 

9.3 Third-Party Claims.

 

(a) The Indemnified Person shall give notice of the assertion of a Third-Party Claim to the Indemnifying Person; provided, however, that no failure or delay on the part of an Indemnified Person in notifying an Indemnifying Person will relieve the Indemnifying Person from any obligation under this Section 9 except to the extent that the failure or delay materially prejudices the defense of the Third-Party Claim by the Indemnifying Person.

 

(b)

 

(i) Except as provided in Section 9, the Indemnifying Person may elect to assume the defense of the third-party claim with counsel satisfactory to the Indemnified Person by (a) giving notice to the Indemnified Person of its election to assume the defense of the Third-Party Claim and (b) giving the Indemnified Person evidence acceptable to the Indemnified Person that the Indemnifying Person has adequate financial resources to defend against the Third-Party Claim and fulfill its obligations under this Section 9, in each case no later than ten (10) days after the Indemnified Person gives notice of the assertion of a Third-Party Claim under Section 9.3(a).

 

 

(ii) If the Indemnifying Person elects to assume the defense of a Third-Party Claim:

 

(A) it shall diligently conduct the defense and, so long as it diligently conducts the defense, shall not be liable to the Indemnified Person for any Indemnified Person’s fees or expenses subsequently incurred in connection with the defense of the Third- Party Claim other than reasonable costs of investigation,

 

(B) the election will conclusively establish for purposes of this Agreement that the Indemnified Person is entitled to relief under this Agreement for any loss arising, directly or indirectly, from or in connection with the Third-Party Claim,

 

(C) no compromise or settlement of such Third- Party Claim may be effected by the Indemnifying Person without the Indemnified Person’s consent unless (I) there is no finding or admission of any violation by the Indemnified Person of any Laws or any rights of any Person, (II) the Indemnified Person receives a full release of and from any other claims that may be made against the Indemnified Person by the Third Party bringing the Third-Party Claim, and (III) the sole relief provided is monetary damages that are paid in full by the Indemnifying Person, and

 

(D) the Indemnifying Person shall have no liability with respect to any compromise or settlement of such claims effected without its consent.

 

(iii) If the Indemnifying Person does not assume the defense of a Third-Party Claim in the manner and within the period provided in Section 9.3(b)(i), or if the Indemnifying Person does not diligently conduct the defense of a Third-Party Claim, the Indemnified Person may conduct the defense of the Third-Party Claim at the expense of the Indemnifying Person and the Indemnifying Person shall be bound by any determination resulting from such Third-Party Claim or any compromise or settlement effected by the Indemnified Person.

 

 

(c) Notwithstanding the foregoing, if an Indemnified Person determines in good faith that there is a reasonable probability that a Third-Party Claim may adversely affect it or any Affiliate other than as a result of monetary damages for which it would be entitled to relief under this Agreement, the Indemnified Person may, by notice to the Indemnifying Person, assume the exclusive right to defend, compromise, or settle such Third-Party Claim.

 

(d) Notwithstanding the provisions of Section 11.12, the Parties consent to the nonexclusive jurisdiction of any court in which a proceeding is brought against any Indemnified Person for purposes of determining any claim that an Indemnified Person may have under this Agreement with respect to such proceeding or the matters alleged therein.

 

(e) With respect to any Third-Party Claim subject to this Section 9.3: (i) any Indemnified Person and any Indemnifying Person, as the case may be, shall keep the other Person fully informed of the status of such Third-Party Claim and any related proceeding at all stages thereof where such Person is not represented by its own counsel, and (ii) both the Indemnified Person and the Indemnifying Person, as the case may be, shall render to each other such assistance as they may reasonably require of each other and shall cooperate in good faith with each other in order to ensure the proper and adequate defense of any Third- Party Claim.

 

(f) In addition to Section 10, with respect to any Third-Party Claim subject to this Section 9.3, the Parties shall cooperate in a manner to reserve in full (to the extent possible) the confidentiality of all confidential information and the attorney-client and work product privileges. In connection therewith, each Party agrees that: (i) it shall use its best efforts, in respect of any Third-Party Claim in which it has assumed or participated in the defense, to avoid production of confidential information (consistent with applicable Law and rules of procedure) and (ii) all communications between any Party and counsel responsible for or participating in the defense of any Third-Party Claim shall, to the extent possible, be made so as to preserve any applicable attorney-client or work-product privilege.

 

(g) Any claim under this Section 9.3 for any matter involving a Third-Party Claim shall be indemnified, paid, or reimbursed promptly. If the Indemnified Person shall for any reason assume the defense of a Third-Party Claim, the Indemnifying Person shall reimburse the Indemnified Person on a monthly basis for the costs of investigation and the reasonable fees and expenses of counsel retained by the Indemnified Person.

 

9.4 Indemnitee Negligence.

 

The provisions in this Section 9 shall be enforceable regardless of whether the liability is based upon past, present or future acts, claims or Laws and regardless of whether any Person (including the Person from whom relief is sought) alleges or proves the sole, concurrent, contributory, or comparative negligence of the Person seeking relief, or the sole or concurrent strict liability imposed upon the person seeking relief.

 

10. CONFIDENTIALITY AND PRESS RELEASE

 

10.1 Disclosure of Terms.

 

The terms and conditions of this Agreement, the other Transaction Documents, any term sheet or memorandum of understanding entered into pursuant to the transactions contemplated hereby and thereby, all exhibits and schedules attached hereto and thereto, and the transactions contemplated hereby and thereby (collectively, the “Confidential Information”), including their existence, shall be considered confidential information and the Parties hereto shall not, and shall procure their respective Affiliates not to, disclose to any third party except as permitted in accordance with the provisions set forth below.

 

 

10.2 Press Release.

 

Any public announcement, including any press release, communication to employees customers, suppliers, or others having dealings with the Purchaser or the Company, or similar publicity with respect to this Agreement or any Transaction, will be issued, at such time, in such manner and containing such content as the Purchaser and all the Seller agree in writing, except that the affiliates of the Purchaser may issue any press release in its sole discretion without any consent from the Purchaser and any Seller.

 

10.3 Permitted Disclosure.

 

Notwithstanding anything in the foregoing to the contrary:

 

(a) the Seller may disclose any portion of the Confidential Information to the Company’s, officers, directors, Key Employees, investment bankers, lenders, accountants, auditors, business or financial advisors, and attorneys, in each case only where such persons or entities are under appropriate non-disclosure obligations imposed by professional ethics, law or otherwise;

 

(b) the Purchaser may disclose any portion of the Confidential Information to its current officers, directors, Key Employees, investment bankers, lenders, accountants, auditors, business or financial advisors, and attorneys, in each case only where such persons or entities are under appropriate non-disclosure obligations imposed by professional ethics, law or otherwise, and the affiliates of the Purchaser may disclose any portion of the Confidential Information in any of its public flings in its sole discretion; and

 

(c) the confidentiality obligations set out in Section 10.1 above do not apply to:

 

(i) information which was in the public domain or otherwise known to the relevant Party before it was furnished to it by another Party or, after it was furnished to that Party, entered the public domain otherwise than as a result of (i) a breach by that Party of this Section 10, or (ii) a breach of a confidentiality obligation by the discloser, where the breach was known to that Party;

 

(ii) information the disclosure of which is necessary in order to comply with any applicable Law, the order of any court, the requirements of a stock exchange or to obtain tax or other clearances or consents from any relevant authority; or

 

 

(iii) information disclosed by any director of the Company to its appointer or any of its Affiliates or otherwise in accordance with the foregoing provisions of this Section 10.

 

10.4 Other Information.

 

The provisions of this Section 10 shall be in addition to, and not in substitution for, the provisions of any separate non-disclosure agreement executed by any of the Parties hereto with respect to the Transactions.

 

11. MISCELLANEOUS

 

11.1 Fees and Expenses.

 

Except as otherwise provided in this Agreement or the other documents to be delivered pursuant to this Agreement, each Party will bear its respective fees and expenses incurred in connection with the preparation, negotiation, execution, and performance of this Agreement and the consummation and performance of the Transactions, including all fees and expenses of its officers, directors, partners, employees, agents or representatives. The obligation of each Party to bear its own fees and expenses will be subject to any rights of such Party arising from a breach of this Agreement by another Party.

 

The stamp duty in connection with the Transactions shall be borne equally by the Seller (on the one hand) and the Purchaser (on the other hand). Each Seller shall be solely responsible for his, her or its own income tax, capital gain tax or other forms of Taxes payable by the Seller under the applicable Laws.

 

11.2 Further Assurance.

 

The Parties will (a) execute and deliver to each other such other documents and (b) do such other acts and things as a Party may reasonably request for the purpose of carrying out the intent of this Agreement, the Transactions, and the documents to be delivered pursuant to this Agreement.

 

11.3 Entire Agreement.

 

This Agreement supersedes all prior agreements, whether written or oral, between the Parties with respect to its subject matter (including any letter of intent and, upon the Closing, any confidentiality obligation to which the Purchaser is subject) and constitutes a complete and exclusive statement of the terms of the agreement between the Parties with respect to the subject matter of this Agreement.

 

11.4 Amendment.

 

This Agreement may only be amended, supplemented, or otherwise modified by all Parties in writing.

 

 

11.5 Assignments and Successors.

 

The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the Parties. Nothing in this Agreement, express or implied, is intended to confer upon any Party other than the Parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

 

11.6 No Third-Party Rights.

 

Other than the Indemnified Persons and the Parties, no Person will have any legal or equitable right, remedy, or claim under or with respect to this Agreement. This Agreement may not be amended or terminated, and any provision of this Agreement may be waived, without the consent of any Person who is a Party to the Agreement.

 

11.7 Remedies Cumulative.

 

The rights and remedies of the Parties under this Agreement are cumulative and not alternative.

 

11.8 Governing Law.

 

This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to the principles of conflicts of law thereof.

 

11.9 Dispute Resolution.

 

Each Party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the State of New York for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby waives all rights to a trial by jury.

 

11.10 Attorney’s Fees.

 

In the event any claim, action, suit, proceeding, arbitration, complaint, charge or investigation is brought in respect of this Agreement or any of the documents referred to in this Agreement, the prevailing Party shall be entitled to recover reasonable attorneys’ fees and other costs incurred in such claim, action, suit, proceeding, arbitration, complaint, charge or investigation, in addition to any relief to which such Party may be entitled under applicable Law.

 

 

11.11 Enforcement of Agreement.

 

Each Party acknowledge and agree that the other Party would be irreparably harmed if any of the provisions of this Agreement are not performed in accordance with their specific terms and that any breach of this Agreement by such Party could not be adequately compensated in all cases by monetary damages alone. Accordingly, each Party agrees that, in addition to any other right or remedy to which the other Party may be entitled at law or in equity, such Party shall be entitled to enforce any provision of this Agreement by a decree of specific performance and to obtain temporary, preliminary, and permanent injunctive relief to prevent breaches or threatened breaches, without posting any bond or giving any other undertaking.

 

11.12 No Waiver.

 

Neither any failure nor any delay by any Party in exercising any right, power, or privilege under this Agreement or any of the documents referred to in this Agreement will operate as a waiver of such right, power, or privilege, and no single or partial exercise of any such right, power, or privilege will preclude any other or further exercise of such right, power, or privilege or the exercise of any other right, power, or privilege. To the maximum extent permitted by applicable Law, (a) no claim or right arising out of this Agreement or any of the documents referred to in this Agreement can be waived by a Party, in whole or in part, unless made in a writing signed by such Party, (b) a waiver given by a Party will only be applicable to the specific instance for which it is given, and (c) no notice to or demand on a Party will (i) waive or otherwise affect any obligation of that Party or (ii) affect the right of the Party giving such notice or demand to take further action without notice or demand as provided in this Agreement or the documents referred to in this Agreement.

 

11.13 Notices.

 

All notices and other communications required or permitted by this Agreement shall be in writing and will be effective, and any applicable time period shall commence, when (a) delivered to the following address by hand or by a nationally recognized overnight courier service (costs prepaid) addressed to the following address or (b) transmitted electronically to the following facsimile numbers or e-mail addresses, in each case marked to the attention of the Person (by name or title) designated below (or to such other address, facsimile number, e-mail address, or Person as a Party may designate by notice to the other Party):

 

The Seller:

Address: 650 5^th Ave, Suite 2416, New York, NY, 10019

E-mail: haohan@fresh2.co

 

 

The Purchaser:

Address: 650 5^th Ave, Suite 2416, New York, NY, 10019

E-mail: Xingyan_Gao@anpac.cn

 

The Company:

Address: 650 5^th Ave, Suite 2416, New York, NY, 10019

Email: haohan@fresh2.co

 

11.14 Severability.

 

If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect. Any provision of this Agreement held invalid or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable.

 

11.15 Time of Essence.

 

With regard to all dates and time periods set forth or referred to in this Agreement, time is of the essence.

 

11.16 Counterparts and Electronic Signatures.

 

(a) This Agreement and other documents to be delivered pursuant to this Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy and all of which, when taken together, will be deemed to constitute one and the same agreement or document, and will be effective when counterparts have been signed by each of the Parties and delivered to the other Party.

 

(b) A manual signature or electronic signature on this Agreement or other documents to be delivered pursuant to this Agreement, an image of which shall have been transmitted electronically, will constitute an original signature for all purposes. The delivery of copies of this Agreement or other documents to be delivered pursuant to this Agreement, including executed signature pages where required, by electronic transmission will constitute effective delivery of this Agreement or such other document for all purposes.

 

[Signature Pages Follow]

 

 

IN WITNESS WHEREOF, the Parties have executed this Interest Purchase Agreement as of the date first written above.

 

NASSAU ENTERPRISES LLC
By:	/s/ Haohan Xu
Name:	Haohan Xu
Title:	Manager

 

Foodbase Group Inc.
By:	/s/ Haohan Xu
Name:	Haohan Xu
Title:	CEO

 

Haohan Xu
/s/ Haohan Xu

 

[Signature Page to the Interest Purchaser Agreement]

 

 

 

Exhibit 10.2

 

AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT

FOR

NASSAU ENTERPRISES LLC

 

This Amended and Restated Limited Liability Company Agreement (hereinafter referred to as the "Agreement") is dated as of May 24^th, 2023, by and among Foodbase Group Inc. and Haohan Xu (hereinafter referred to collectively as the "Members" and individually as a "Member") and Nassau Enterprises LLC, a Delaware limited liability company (hereinafter referred to as "Company").

 

PREAMBLE

 

Whereas, the Company was formed by the filing of a certificate of formation with the Secretary of State of the State of Delaware on March 29, 2023.

 

WHEREAS, the Members wish to enter into this Agreement setting forth the terms and conditions governing the operation and management of the Company

 

NOW, THEREFORE, in consideration of the premises and the mutual promises, covenants and agreements contained in this Agreement, the parties hereto, intending to be legally bound hereby, agree to become members of a limited liability company under the laws of the State of Delaware in accordance with the following terms and conditions:

 

ARTICLE I. FORMATION AND PURPOSE

 

1.1 Governing Law and Government Filings. The Members have caused a Certificate of Formation that complies with the requirements of the Act to be properly filed with the Office of the Secretary of State for the State of Delaware (hereinafter referred to as the "Certificate") and shall execute such further documents and take such further action as is necessary or appropriate from time to time to comply with the requirements for the formation and operation of a limited liability company in the State of Delaware and in all other jurisdictions where the Company conducts its business.

 

1.2 Name. The name of the Company shall be Nassau Enterprises LLC.

 

1.3 Purpose of the Company. The purpose and business of the Company shall be to engage in products and lawful business activity agreed to by the Voting Members (as herein defined) and to conduct such other activities as may be necessary or appropriate to promote the business of the Company. The Company may exercise all the powers and privileges either granted or limited under the Act.

 

 

1.4 Registered Office; Registered Agent. The name of the registered agent for service of process on the Company in the State of Delaware is Incorporating Services, Inc. The address of the registered office of the Company in the State of Delaware is 3500 South Dupont Highway, Dover, Delaware, 19901, County of Kent.

 

1.5 Principal Place of Business. The Company's principal place of business shall be located at 650 5^th Avenue Suite #2416 New York NY 10019 or at such other place as the Members may select from time to time.

 

1.6 Expenses of Formation. The Company shall bear the expenses incident to its formation. Each Member shall bear his own personal expenses, if any, incurred in connection with his decision to enter into this Agreement.

 

ARTICLE II. TERM

 

2.1 Term. The term of the Company shall commence on the effective date of the filing of the Certificate with the Office of the Secretary of State of the State of Delaware and shall be perpetual.

 

ARTICLE III. CAPITAL CONTRIBUTIONS AND COMPANY INTERESTS

 

3.1 Company Capital. The capital of the Company shall be the aggregate sum of the capital contributions made by the Members to the Company in the manner provided for in this Agreement. ‌

 

3.2 Capital Contribution. Foodbase Group Inc. shall contribute Five Million and Five Hundred Thousand US Dollars ($5,500,000) (“Foodbase Contribution”) to the Company provided that the Company shall complete the purchase of 100% interests of SLV Windfall Group LLC, a Delaware limited liability company, Windfall SLV Development LLC, a Delaware limited liability company, and SLV Windfall Management, LLC, (together, “Target Companies”).

 

3.3 Company Interest. For purposes of this Agreement, the term "Company interest" shall mean each Member's share of the Company's net profits and net losses, the right to receive distributions of Company property and the rights, powers and liabilities of a Member as defined and described in the Act and this Agreement. The nature of a Company interest shall be personal property for all purposes.

 

3.4 Company Interests. The Company interest of the Members shall be represented by Voting Units (hereinafter referred to as the “Voting Units”) and Non-Voting Units (hereinafter referred to as the “Nonvoting Units”). With respect to Voting Units of the Company, each Voting Member shall be entitled to one vote per Voting Unit owned by such Member. The Nonvoting Units shall have no voting rights attached to them, and each member holding the Nonvoting Units shall not be entitled to vote any Nonvoting Units on any Company matter, unless otherwise provided herein. Each Member's Company interest shall be equal to the number of Units set forth in Schedule A.

 

 

Members holding any number of Voting Units greater than zero (0) are hereinafter referred to as the “Voting Members” and Members holding only Nonvoting Units, and no Voting Units, are hereinafter referred to as the “Nonvoting Members”.

 

3.5 Form of Contributions. All capital contributions made by a Member to the Company may be made in the form of cash, membership interests, stocks or other assets.

 

3.6 Additional Capital Contributions. No Member shall be required to make any further or additional capital contributions to the Company, except as required by the Act or this Agreement. No Member shall have the right to make additional capital contributions to the Company, except with the unanimous consent of Members.

 

3.7 Withdrawal of Capital Contributions. No Member shall have the right to withdraw or reduce such Member’s capital contributions to the Company, except with the unanimous consent of Members. No Member shall be entitled to receive any interest on his capital contributions to the Company.

 

3.8 Use of Contributions. The aggregate of all capital contributions made by the Members to the Company shall be available to the Company to carry out the purposes of the Company except as otherwise set forth in this Agreement.

 

3.9 Ownership of Property. All Company property, whether real or personal, tangible or intangible, shall be owned by the Company. No Member shall have any interest in any specific Company property.

 

3.10 No Right of Partition. Each Member waives any right he may have to cause Company property to be partitioned or otherwise divided among the Members, or to file a complaint or institute any proceeding at law or equity to cause Company property to be partitioned or otherwise divided among the Members.

 

 

3.11 Composition of Capital Accounts. The Company shall establish and maintain a separate capital account for each Member in accordance with applicable federal tax laws. Each Member's capital account shall be determined and maintained as follows:

 

a. Contributions, Income and Gains. Each Member's capital account shall be increased by: (1) the amount of money contributed by that Member; (2) the fair market value at the time of contribution of all property other than money contributed by that Member, reduced by any liabilities secured by that property which are assumed or taken subject to by the Company; and (3) that Member's share of Company income and gains, including income and gains which are exempt from or not recognized for federal income tax purposes, as computed for book purposes; and

 

b. Distributions, Deductions and Losses. Each Member's capital account shall be decreased by: (1) the amount of money distributed to that Member; (2) the fair market value at the time of distribution of all property other than money distributed to that Member, reduced by any liabilities secured by that property which are assumed or taken subject to by that Member; and (3) that Member's share of Company losses and deductions, including Company expenditures which are not deductible or capitalizable for federal income tax purposes, as computed for book purposes.

 

3.12 Transferee's Capital Account. In the event of a permitted transfer of a Company interest as provided in this Agreement, the capital account of the transferor shall become the capital account of the transferee to the extent it relates to the transferred Company interest.

 

3.13 Compliance with Applicable Federal Tax Laws. The manner in which the capital accounts of the Members are to be maintained pursuant to this Article III of this Agreement is intended to comply with the requirements of all applicable federal tax laws. If in the opinion of all of a majority in interest of the Voting Members the manner in which capital accounts are to be maintained pursuant to this Article III of this Agreement should be modified in order to comply with the applicable federal tax laws, then notwithstanding anything contained in this Agreement to the contrary, the Voting Members shall alter the method in which the capital accounts are maintained and amend this Agreement to reflect any such change in the manner in which capital accounts are maintained; provided, however, that any change in the manner of maintaining capital accounts shall not materially alter the economic agreement between the Members.

 

3.14 Foodbase Group Inc. has the right, but not the obligation, to make capital contribution up to an amount of $22,500,000 to the Company at the discretion of Foodbase Group Inc. at any time during two years (2) from signing of this Agreement. At the time of the Company receiving capital contributions of $22,500,000 from Foodbase Group, Haohan Xu or Haohan Xu’s successor shall transfer all his interests in the Company to Foodbase Group Inc. without any consideration. If Foodbase Group Inc. making capital contributions of less than $22,500,000, Haohan Xu or Haohan Xu’s successor shall transfer his interests in the Company to Foodbase Group Inc. pro rata in accordance with the capital contribution made by the Foodbase Group without any consideration.

 

 

ARTICLE IV. ALLOCATIONS AND DISTRIBUTIONS

 

4.1 Allocation of Company Items. All items of income, gain, loss, deduction or credit of the Company shall be allocated among the Members in proportion to their Company interests; provided, however, that for federal income tax purposes such items of income, gain, loss and deduction or credit with respect to property contributed by a Member to the Company shall be allocated between the Members so as to take account of the variation between the federal income tax basis of the property to the Company and its fair market value at the time of its contribution to the Company in accordance with applicable federal tax laws.

 

4.2 Reallocation on Transfer. In the event that a Member's interest is transferred in accordance with the provisions of this Agreement, the allocations provided in this Article IV of this Agreement shall be further reallocated between the transferor and the transferee in the same ratio as the number of days each of them owned the Company interest during the fiscal year of the Company for which the allocation is being made, unless the books of the Company permit the allocation of items of income and expense to the periods of time before and after the transfer, in which case the latter allocation shall be made.

 

4.3 Distribution of Net Cash. Following the end of each fiscal year of the Company and the adjustment of the Member's capital accounts for that fiscal year, the Company may distribute the Net Cash of the Company to the Members by the unanimous consent of Members in proportion to the Percentage of Membership Interests of the Members. The term "Net Cash" shall mean an amount which is equal to the net profits of the Company except that (a) depreciation of buildings, improvements, personal property and amortization of leasehold improvement, if applicable, shall not be considered a deduction, (b) payment of interest on and repayment of principal of, debts shall be considered a deduction, (c) any amounts expended on behalf of the Company for capital improvements or new investments with the unanimous consent of Members shall be considered a deduction, and (d) any reasonable reserve of capital with the unanimous consent of Members to provide funds to be invested in additional Company property, to provide funds for capital improvements for Company property, or to provide funds for any other contingency of the Company shall be considered a deduction.

 

ARTICLE V. COMPETITION

 

5.1 Any Member may engage in any other business, whether or not the same or similar to the business of the Company, and whether or not such other business is competitive with the Company. Neither the Company nor the other Members shall have any rights in the income or profits of that business.

 

 

ARTICLE VI. TAX, FINANCIAL AND ACCOUNTING MATTERS

 

6.1 Fiscal Year and Accounting Method. The fiscal year of the Company for both accounting and income tax purposes shall be the calendar year, and for both accounting and income tax purposes the Company shall report its operations and profits and losses in accordance with the cash method of accounting, unless a different method of accounting is required by applicable federal tax laws.

 

6.2 Annual Tax Return and Financial Statements. The accountant for the Company shall prepare all required tax returns for the Company as of the end of each fiscal year, including the balance sheet and statement of income and expenses relating to such fiscal year, and a statement of each Member's distributive share of the items of income, gain, loss, deduction and credit of the Company for tax purposes for such fiscal year. The Company shall furnish each Member with a copy of each such tax return and statement within thirty (30) days after the Company files its tax returns for such fiscal year.

 

6.3 Tax and Accounting Matters. All elections with respect to the preparation and filing of the Company tax returns, the reporting of items of Company income, gain, loss, deduction and credit, and all other elections which the Company or Members are entitled to make with respect to Company matters, shall be made only by the Company. Jing Ni shall be the Tax Matters Member for the Company for income tax purposes. All decisions as to accounting matters shall be made in accordance with generally accepted accounting principles applied on a basis consistent with prior periods.

 

6.4 Books and Records. The Company shall maintain a full and accurate set of books and records at its principal place of business. Each Member and his duly authorized representative shall have access to and may inspect and copy any such books and records at all reasonable times.

 

6.5 Bank Account. The Company shall open and maintain a bank account or bank accounts in the name of the Company at a bank or banks from time to time. All funds of the Company not otherwise invested shall be deposited in and withdrawn from such bank account(s).

 

ARTICLE VII. MANAGER

 

7.1 Managers. The Manager of the Company is:

 

Haohan Xu

 

Each Manager and CEO shall only be removed by the unanimous consent of the Voting Members, and serve until his successor is chosen by an unanimous consent of the Voting Members.

 

7.2 Responsibilities of Manager. The doing of any act or failure to do any act which may result in a loss to the Company, if done in good faith and in a manner reasonably believed to be in the best interest of the Company, shall not subject the Managers to any liability to the Company.

 

 

7.3 Powers of the Managers and Officer. The phrase "Majority Consent of Managers" as used in this Agreement shall mean a written consent of the majority of the Managers.

 

(i) Haohan Xu is the CEO (“CEO”) of the Company and shall have the authority and responsibility for the management of the Company and the operation of the business of the Company, including the day-to-day management, operations, unless otherwise specified in Section 7.3 (ii). The CEO shall have the full authority to execute bonds, mortgages, loans, leases, contracts and other legal instruments for the Company if agreed by the Manager, is authorized to open and sign bank accounts and to authorize other officers or persons to open and sign such accounts, and have the authority to take all other action necessary or appropriate in connection with his authority and duties of the management and business of the Company under this Agreement and applicable laws.

 

(ii) Notwithstanding the foregoing, the Company and the CEO shall not undertake any of the following actions without the Majority Consent of Managers:

 

a. borrow money or obtain bank or other commercial credit;

 

b. lending money;

 

c. amend this Agreement;

 

d. deviate from any of the purposes of the Company as set forth in Section 1.3;

 

e. take any action to reconstitute the Company in the event of the dissolution of the Company for any reason;

 

f. increase the salary of the Managers;

 

g. engage contractors and sub-contractors to construct and develop any real estate projects in which the Company directly or indirectly owns;

 

h. enter into joint venture agreements, operating agreements and the like relating to any acquisition or development;

 

i. expenditures beyond and not otherwise authorized by the Company budget;

 

j. Amend the approved budget of the Company;

 

k. Investment decisions or acquire shares, interests or assets of other entities.

 

 

7.4 Compensation for Managers. The Managers may be entitled to compensation for personal services rendered by them on behalf of the Company in their capacity as the Managers. For purposes of this Sub Article, reimbursement for out-of-pocket expenses shall not be construed as "compensation". The Managers shall be fully reimbursed by the Company for all out-of-pocket expenses incurred by them on behalf of the Company.

 

7.5 Indemnification of Managers. The Company shall appear, defend and indemnify the Managers from any and all claims, losses, expenses, costs, fines, penalties, judgments or damages, including reasonable attorneys' fees, which the Managers may incur by reason of any act or a failure to act with respect to the Company or in furtherance of its interest, if done in good faith and in a manner reasonably believed to be in the best interest of the Company.

 

7.6 Personal Liability of Members. No Member shall have any personal liability for the liabilities or obligations of the Company, except to the extent of the capital contributions made or required to be made by such Member to the Company in accordance with the terms of this Agreement.

 

ARTICLE VIII. ADMISSION , REMOVAL AND RESIGNATION OF MEMBERS

 

8.1 Initial Members. All persons having executed this Agreement as Members shall be admitted as Members without any further act on the part of the Company or the other Members.

 

8.2 Additional Members. Following the execution of this Agreement by the initial Members, persons acquiring a Company interest directly from the Company (whether the Company interests are being issued for the first time or being reissued as a result of a reacquisition by the Company) shall not be admitted as Members of the Company, except upon the written unanimous consent of Voting Members.

 

8.3 Successor Members. Any persons acquiring a Company interest by transfer from an existing Member shall not be admitted as a Member of the Company, except upon the written unanimous consent of Voting Members.

 

8.4 Preconditions to Admission. In no event shall a Member consent to the admission of any person as a Member of the Company, unless and until:

 

a. Such person agrees to execute this Agreement, as then amended, and such other instruments as may be required by the Act or necessary or appropriate to confirm and record such person's undertaking to be bound by the terms of this Agreement; and

 

 

b. Such person agrees to pay all the reasonable expenses, including attorney's fees, incurred by the Company in connection with the transfer, if any, and the admission of such person as a Member.

 

8.5 Reserved.

 

8.6 Resignation of Members. No Member shall resign from the Company prior to the dissolution and winding up of the Company, except upon the written unanimous consent of Voting Members. Any resigning Member transferring his Company interest in conformity with the transfer provisions of Article IX of this Agreement, whether to the Company, an existing Member or to a third party, shall be deemed to have resigned from the Company without violating this Agreement upon and to the extent of the transfer, and shall be entitled to payment for all amounts due to such Member under this Agreement in the same manner as provided for in Article IX of this Agreement.

 

ARTICLE IX. TRANSFER OF COMPANY INTERESTS

 

9.1 Transfers Restricted. No Member shall withdraw from the Company, or transfer all or any part of his Company interest, except as provided in this Article IX of this Agreement. In the event that a Member or a transferee of a Member violates any of the provisions of this Article IX of this Agreement, such transfer shall be null and void and of no force or effect.

 

9.2 "Transfer" Defined. The term "transfer" shall mean and include any distribution, sale, transfer, assignment, gift, creation of an encumbrance, pledge, hypothecation, grant of a security interest, lien or other disposition, either with or without consideration, of the Company interest of a Member.

 

9.3 Transfer Not an Event of Dissolution. Except as otherwise provided in Article X of this Agreement, the transfer by a Member of his Company interest shall not cause the dissolution or termination of the Company and the business of the Company may be continued thereafter by and for the benefit of the remaining Members.

 

9.4 Voluntary Transfer. No Member may withdraw from the Company or voluntarily transfer all or any part of his Company interest, without the written unanimous consent of Voting Members.

 

9.5 Permitted Transfers. Notwithstanding anything contained in this Agreement to the contrary, a Member shall have the right to transfer all or any part of his Company interest to another Member or to a transferee that bears one of the following relationships to the transferring Member: a spouse, a lineal descendant, or a trust created for the exclusive benefit of the transferring Member, the transferring Member’s spouse and/or the transferring Member’s lineal descendant(s).

 

 

9.6 Costs and Expenses of Transfer. The Transferring Member shall pay all costs and expenses incurred by the Company in connection with any transfer of a Company interest pursuant to this Article IX of this Agreement and/or another person's becoming a Member of the Company or an assignee of a Member of the Company, including, but not limited to, all filing, recording and publishing costs and reasonable attorneys' fees and disbursements.

 

ARTICLE X. DISSOLUTION AND TERMINATION

 

10.1 Reserved.

 

10.2 Events Causing Dissolution. The Company shall be dissolved upon the occurrence of the earliest of the following events:

 

a. By the written unanimous consent of Voting Members;

 

b. The death, insanity, retirement, resignation, removal, expulsion, bankruptcy or dissolution of a Voting Member or the occurrence of any other event which terminates the continued membership of a Voting Member in the Company, unless the business of the Company is continued by the written consent of a majority in interest of the remaining Voting Members within ninety (90) days following the occurrence of any such event; or

 

c. Upon the occurrence of any other event causing a dissolution under the Act or this Agreement.

 

10.3 Winding Up. Upon the dissolution of the Company, the last remaining Voting Member(s) or, if none, the personal representative of the last remaining Voting Member, shall conclude the business of the Company, wind up its affairs, distribute its assets in liquidation, and file all certificates or notices required by the Act to evidence such dissolution, liquidation and termination. Except as otherwise expressly provided for in the Act, all decisions pertaining to the dissolution of the Company shall be made in the same manner as decisions made in the ordinary course of the Company's business.

 

10.4 Termination. Upon the completion of the winding up of the Company’s affairs, the Company shall file a Certificate of Cancellation with the Delaware Secretary of State.

 

10.5 Final Accounting; Deficit Capital Accounts. Upon the dissolution of the Company, a final accounting shall be made of the capital account of each Member, adjusted up or down to reflect each Member's proportionate share of the Company's net profit or net loss from the time of the last previous accounting to the date of the dissolution. In the event a Member has a deficit balance in his capital account at the time of the dissolution of the Company, that Member shall be required to contribute sufficient capital to the Company within thirty (30) days of the date of the dissolution of the Company to eliminate the deficit balance in his capital account.

 

 

10.6 Priority of Distributions. Distributions in liquidation of the Company shall be made in the following order:

 

a. First, those owing to creditors of the Company, including Members who are creditors of the Company, and any foreseeable creditors within 10 years from the date of liquidation;

 

b. Second, those owing to the Members other than for capital and profits;

 

c. Third, those owing to the Members in respect of capital; and

 

d. Fourth, those owing to the Members in respect of profits in proportion to their Percentage of Membership Interests as set forth in Schedule A.

 

10.7 Payment of Claims. Upon the dissolution of the Company, the Company shall pay or make reasonable provisions to pay all claims and obligations of the Company, including all contingent, conditional or unmatured claims and obligations, known to the Company and all claims and obligations which are known to the Company, but for which the identity of the claimant is unknown. If the Company has sufficient assets, such claims and obligations shall be paid in full and any such provision for payment made shall be made in full. If there are insufficient assets, such claims and obligations shall be paid or provided for according to their priority and, among claims and obligations of equal priority, ratably to the extent of the assets available therefore. Any remaining Company assets shall be distributed as provided in Sub Article 10.5 of this Agreement.

 

10.8 Distributions in Kind. No Member may demand or receive property other than cash in return for his contributions, loans or advances to the Company or upon distribution or dissolution from the Company as provided herein unless specified otherwise by the Manager; provided, however, that in the event that all of the Voting Members at the time of dissolution so determine, it shall not be necessary to liquidate all of the property of the Company; but the property which shall not be required to be liquidated to satisfy the categories of distribution described in Sub Article 10.5 of this Agreement may be distributed in kind, including, but not limited to, undivided interests in such property, whether or not like property is distributed to each Member.

 

ARTICLE XI. GENERAL PROVISIONS

 

11.1 Notices. All notices, claims, instructions, requests, demands, consents, or other communications which are required or permitted under this Agreement shall be in writing and shall be deemed to have been properly given if and when sent by email or first class United States mail, registered or certified, postage prepaid, return receipt requested, to the addresses provided by each party.

 

 

11.2 Enforceability. The parties agree that the provisions of this Agreement shall be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provisions of this Agreement shall be adjudicated to be invalid, illegal or unenforceable, such provision of this Agreement shall be deemed amended to delete there from the portion thus adjudicated to be invalid, illegal or unenforceable, such deletion to apply only with respect to the operation of such provision of this Agreement in the particular jurisdiction in which such adjudication is made.

 

11.3 Descriptive Headings. The descriptive headings of the Sub Articles of this Agreement are inserted for convenience of reference only and shall not control or affect in any way the meaning, construction, or interpretation of this Agreement.

 

11.4 Governing Law. This Agreement has been executed in the State of Delaware and shall be governed by, and construed, interpreted and enforced in accordance with, the laws of the State of Delaware in all respects.

 

11.5 Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, personal representatives, successors and permitted assigns.

 

11.6 Entire Agreement. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements or understandings among the parties hereto with respect thereto. No representation, condition or understanding not expressed herein shall be binding upon the parties, unless subsequent to the date hereto and signed by all of the parties hereto. This Agreement may not be amended or modified except by a written instrument signed by a majority in interest of the Voting and Non-Voting Members.

 

11.7 Waiver of Breach. The waiver by any party hereto of a breach of any provision of this Agreement by another party hereto must be in writing and shall not operate or be construed as a waiver of any subsequent breach by such other party.

 

11.8 Authorship. No questions of interpretation or construction concerning this Agreement shall be construed or interpreted for or against any party based on the consideration of authorship.

 

11.9 Time of the Essence. Time is of the essence of this Agreement.

 

 

11.10 Gender. When used in this Agreement, singular terms include the plural as appropriate in the context, and masculine terms include the feminine and neuter genders as appropriate in the context.

 

11.11 Agreement in Counterparts. This Agreement may be executed in several counterparts and, as executed, shall constitute one Agreement, binding on all the parties hereto, notwithstanding that all the parties are not signatory to the original or the same counterpart. This Agreement may be executed by facsimile signature(s) or E-signatures.

 

11.12 Arbitration. Any dispute, claim, controversy arising out of or in connection with or relating to this Agreement or any breach or alleged breach hereof shall, upon the request of any party involved, be submitted to and settled by three (3) arbitrators in the principal place of business of the Company, pursuant to the Commercial Arbitration Rules of the American Arbitration Association. The decision of the arbitrators shall be final and binding. Judgment may be entered in any court of record in the appropriate jurisdiction upon the decision of the arbitrators. The cost of the arbitration shall be shared equally by the parties to the arbitration. Each of the parties shall pay their own attorneys' fees incurred in connection with the arbitration.

 

11.13 Tax Status. The parties to this Agreement intend that the Company shall be classified as a sole proprietorship or partnership or as the form of entity elected on Internal Revenue Service Form 8832 or Form 2553, a copy of which is attached hereto, and for federal, state and local income tax purposes the parties agree that the provisions of this Agreement shall be construed and applied in a manner that will not impair the qualification of the Company as such form of entity under the applicable provisions of the Internal Revenue Code, or the laws of any state or local tax authorities.

 

[Signature page to follow]

 

 

IN WITNESS WHEREOF, the parties hereto have signed, sealed and delivered this Agreement on the date hereinabove.

 

	MEMBER:
	Foodbase Group Inc.
	By:	/s/ Haohan Xu
	Name:	Haohan Xu
	Title:	CEO
	Haohan Xu
	/s/ Haohan Xu

 

 

Schedule A

 

Name of Member	Voting Units	Nonvoting Units	Total Units	Percentage of Membership Interests
Foodbase Group Inc.	1964	0	10000	19.64%
Haohan Xu	8036	0	10000	80.36%

 

 

 

 

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