UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 2011
HUTECH21 CO. LTD.
| 001-10559 |
| (Commission File Number) |
#201 Daerungtechnotown III
Gasan-Dong
Geumcheon-Gu, Seoul
Korea 153-772
(Address of Principal Executive Offices)
_______________
+82 2 2107 7200
(Registrant Telephone number)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F [ X ] Form 40-F [ ]
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [ ]
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [ ]
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Security Exchange Act of 1934.
Yes [ ] No [ X ]
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
| (1) |
This current report on Form 6-K is filed by Hutech21 Co. Ltd., a British Virgin Island corporation (the “Registrant”), in connection with the items set forth below.
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
On January 19, 2011, Taehoan Park, an individual from the Republic of Korea (“Mr. Park"), executed a promissory note (the “Note”), which was guaranteed by the Registrant, pursuant to which Mr. Park agreed to pay to Precursor Management Inc. (the "Lender") the sum of Four Hundred Thousand and 00/100 Dollars ($400,000), secured by a pledge of Ten Million (10,000,000) shares of Preferred Stock, par value $.0001 per share, of the Registrant standing in the name of Mr. Taehoan Park (our CEO and Director). Simultaneous to the execution of the Note, the Registrant executed a written guaranty (the “Guaranty”) which guaranty’s payment of the $400,000 pursuant to the Note. In the event that Mr. Park shall default on his obligations under the Note, we will be legally obligated to assume payments thereunder. In addition the Lender will have the right to foreclose on the stock pledged as security for the Note which would give the Lender full voting control over our company. A copy of the written Guaranty is attached hereto as Exhibit 10.3. This financing arrangement was negotiated as a condition to and in order to secure payment under the Plan of Exchange, the details of which were set forth in the Current Report on Form 6-K filed on April 14, 2011.
The foregoing description of the terms of the Note is qualified in its entirety by reference to the provisions of the Note filed as Exhibit 10.1 to this report, which is incorporated by reference herein.
FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits
| Exhibit No. | Description |
| 10.1 | Series 2011 Secured Note Due January 19, 2012, executed by Taehoan Park |
| 10.2 | Stock Pledge Agreement, dated July 1, 2011 |
| 10.3 | Guaranty, dated July 1, 2011 |
| (2) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: July 1, 2011
| HUTECH21 CO. LTD. | |
| By: | /s/ Taehoan Park |
| Taehoan Park | |
Chief Executive Officer; Chief Financial Officer | |
| (3) |
EXHIBIT INDEX
| Exhibit No. | Description |
| 10.1 | Series 2011 Secured Note Due January 19, 2012, executed by Taehoan Park |
| 10.2 | Stock Pledge Agreement, dated July 1, 2011 |
| 10.3 | Guaranty, dated July 1, 2011 |
THIS NOTE HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
No. 011911 U.S. $400,000
Original Issue Date: January 19, 2011
Holder: Precursor Management Inc.
| Address: | 2702-03, 27/F, Goldlion Digital Network Center | |
| 138 Tiyu Road East, Tianhe | ||
| Guangzhou, P.R. China 510620 |
SERIES 2011 SECURED NOTE DUE JANUARY 19, 2012
THIS promissory note (the “Note”), in the principal amount of Four Hundred Thousand and 00/100 Dollars ($400,000.00), evidencing a loan (the "Loan") made on January 19, 2011 (the "Loan Origination Date"), is a duly authorized Note of Taehoan Park, an individual from the Republic of Korea with offices at #201 Daerungtechnotown III Gasan-Dong Geumcheon-Gu, Seoul Korea 153-772 (the "Maker"), due not later than January 19, 2012 ("Maturity Date"), in an aggregate face amount of Four Hundred Thousand and 00/100 Dollars ($400,000.00).
FOR VALUE RECEIVED, the Maker promises to pay to the Holder or registered assigns, the principal sum of Four Hundred Thousand and 00/100 Dollars ($400,000.00) if paid on the Maturity Date ; upon the occurrence of an Event of Default, the amount of principal due hereunder shall conclusively be Four Hundred Thousand and 00/100 Dollars ($400,000.00), and all amounts due hereunder shall be immediately due and payable, together with a default fee equal as set forth below, and any amounts not so paid shall bear interest at the rate of 18% per annum from the of such default through and including the date of payment. The principal of, and interest on, this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, at the address of the Holder last appearing on the Note Register.
This Note is subject to the following additional provisions:
Section 1. Representations and Warranties of the Borrower. The Borrower represents and warrants to the Holder, as of the date hereof as follows:
(a) Authorization of Agreement. The Borrower, if not a natural person, is an entity duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization with full right, corporate, partnership or other applicable power and authority to enter into and to consummate the transactions contemplated by this Note and otherwise to carry out its obligations hereunder, and the execution, delivery and performance by the Borrower of this Note and all other documents delivered in connection herewith (the "Transaction Documents") have been duly authorized by all necessary corporate or similar action on the part of the Borrower. Each of the Transaction Agreements, when executed and delivered by the Borrower, will constitute a valid and legally binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other laws of general application affecting enforcement of creditors' rights generally, (b) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies, or (c) to the extent the indemnification provisions contained herein may be limited by federal or state securities laws.
(b) No Conflicts; Advice. Neither the execution and delivery of the Transaction Documents, nor the consummation of the transactions contemplated thereby, does or will violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge or other restriction of any government, governmental agency, or court to which the Borrower is subject or any provision of its organizational documents or other similar governing instruments, or conflict with, violate or constitute a default under any agreement, credit facility, debt or other instrument or understanding to which the Borrower is a party. The Borrower has consulted such legal, tax and investment advisers as it, in its sole discretion, has deemed necessary or appropriate in connection with its entering into the Note and the other Transaction Documents and consummating the transactions contemplated hereby and thereby.
(c) No Litigation. There is no action, suit, proceeding, judgment, claim or investigation pending, or to the knowledge of the Borrower, threatened against the Borrower which could reasonably be expected in any manner to challenge or seek to prevent, enjoin, alter or materially delay any of the transactions contemplated by this Note or the other documents delivered in connection herewith.
(d) Consents. No authorization, consent, approval or other order of, or declaration to or filing with, any governmental agency or body or other person is required for the valid authorization, execution, delivery and performance by the Borrower of the Note and the other documents delivered in connection herewith and the consummation of the transactions contemplated hereby and thereby.
(e) Bankruptcy. The Borrower is not under the jurisdiction of a court in a Title 11 or similar case (within the meaning of Bankruptcy Code Section 368(a)(3)(A) (or related provisions)) or involved in any insolvency proceeding or reorganization.
(f) Purpose of Loan, Means of Repayment. The Borrower intends to use proceeds for the share acquisition between the Borrower and China Logistics, Inc. The Borrower has a reasonable, good-faith belief in its ability to repay the Loan evidenced by this Note as and when the same may become due and payable. The basis for such belief is set forth in Schedule A attached hereto, and the Borrower will have sufficient unencumbered income from Hutech21 to enable such repayment to be made, as more fully set forth in Schedule A attached hereto.
Section 2. Exchangeability and Transferability. This Note is exchangeable for an equal aggregate principal amount of Notes of different authorized denominations, as requested by the Holder surrendering the same, but shall not be issuable in denominations of less than integral multiples of Twenty Thousand Dollars ($20,000) unless such amount represents the full principal balance of Notes outstanding to such Holder. No service charge will be made for such registration of transfer or exchange. The Holder, by acceptance hereof, agrees to give written notice to the Maker before transferring this Note; such notice will describe briefly the proposed transfer and will give the Maker the name, address, and tax identification number of the proposed transferee, and will further provide the Maker with an opinion of the Lender’s counsel that such transfer can be accomplished in accordance with federal and applicable state securities laws (unless such transaction is permitted by the plan of distribution in an effective Registration Statement). Promptly upon receiving such written notice, the Maker shall present copies thereof to the Maker's counsel.
Section 3. Plan of Repayment. The Maker intends to repay this Note through application of proceeds that it expects to receive as set forth in Schedule A to this Note.
Section 4. Covenants. The Maker covenants and agrees that, so long as any amount is due and owing under the Note, it shall not:
(a) Fail to make any payment of the principal of interest on, or other obligations in respect of, this Note, free of any claim of subordination, as and when the same shall become due and payable on the Maturity Date , for ten (10) days after the same shall be due and payable;
(b) Fail to observe or perform any other covenant, agreement or warranty contained in, or otherwise commit, any breach of this Note;
(c) Suffer to have the guarantor (the "Guarantor") under the guarantee (the "Guarantee") or the pledgor (the "Pledgor") under the stock pledge agreement (the "Stock Pledge Agreement") entered into contemporaneously herewith and of even date herewith fail to observe or perform any covenant, agreement or warranty contained therein, or otherwise commit any breach thereof (this Note, the Guaranty, the Stock Pledge Agreement and all other documents delivered contemporaneously and in connection herewith collectively are referred to as the "Loan Documents");
(d) Commence or suffer to have the Guarantor or the Pledgor commence a voluntary bankruptcy case under insolvency laws as now or hereafter in effect or any successor thereto (the "Bankruptcy Code"); or suffer to have an involuntary case commenced against it, the Guarantor or the Pledgor under the Bankruptcy Code in which the petition is not controverted within thirty (30 days), or is not dismissed within sixty (60) days, after commencement of such involuntary case; or suffer to have a "custodian" (as defined in the Bankruptcy Code) appointed for, or take charge of, all or any substantial part of the property of the Maker, the Guarantor or the Pledgor, or commence any other proceeding under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction whether now or hereafter in effect relating to the Maker, the Guarantor or the Pledgor, or suffer to have commenced against it, the Guarantor or the Pledgor any such proceeding which remains undismissed for a period of sixty (60) days; or be, or suffer to have the Guarantor or the Pledgor be, adjudicated insolvent or bankrupt; or suffer to have any order of relief or other order approving any such case or proceeding entered; or suffer to have any appointment of any custodian or the like for any thereof or any substantial part of its property or the property of the Guarantor or the Pledgor which continues undischarged or unstayed for a period of sixty (60) days; or make, or suffer to have the Guarantor or the Pledgor make, a general assignment for the benefit of creditors; or fail to pay, or state that it is unable to pay, its debts generally as they become due; call, or suffer to have the Guarantor or the Pledgor call, a meeting of all of its respective creditors with a view to arranging a composition or adjustment of its debts; or by any act or failure to act indicate, or suffer to have the Guarantor or the Pledgor indicate, its consent to, approval of or acquiescence in any of the foregoing; or take any corporate or other action for the purpose of effecting any of the foregoing;
(e) Default, or suffer to have the Guarantor or the Pledgor default, in any of its respective obligations under any mortgage, credit agreement or other facility, indenture, agreement or other instrument under which there may be issued, or by which there may be secured or evidenced any indebtedness thereof in an amount exceeding thirty-seven thousand five hundred dollars ($37,500.00), whether such indebtedness now exists or shall hereafter be created and such default shall result in such indebtedness becoming or being declared due and payable prior to the date on which it would otherwise become due and payable;
(f) Be, or suffer to have the Guarantor or the Pledgor be, a party to any Change of Control Transaction (as defined below), or sell or dispose of all or in excess of forty-nine (49%) percent of its respective assets (based on book value calculation as reflected in the its most recent financial statements) in one or more transactions (whether or not such sale would constitute a Change of Control Transaction);
(g) Suffer to have the Common Stock to be suspended (save and except those temporary suspension of trading of stocks for the purpose of making public announcements in compliance with the listing rules of Securities and Exchange Commission) or delisted from trading for in excess of three (3) Trading Days;
(h) Suffer a determination or final determination, as the case may be, by the U.S. Securities and Exchange Commission or Financial Industry Regulatory Authority, or any applicable state regulatory authority, that it, the Guarantor or the Pledgor has violated serious applicable Securities Laws;
(i) Fail, or suffer to have the Pledgor or the Guarantor fail to file any requisite SEC Form, including but not limited to Form 20-F or Form 6-K when due, negatively effecting the listing status or resulting in delisting; or
(j) Make any representation or warranty that is materially untrue and incorrect in all material respects as of the date of this Note, except for representations and warranties that are expressly made as of a particular date, which shall be true and correct in all material respects as of such date.
Section 5. Events of Default. "Event of Default" wherever used herein, means the breach of any covenant hereof (whatever the reason and whether it shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any court, or any order, rule or regulation of any administrative or governmental body). Upon the occurrence of an Event of Default, which Event of Default is not cured within twenty-one (21) days after its occurrence and reasonable extension of time should be granted if the said event of default is likely to be successfully cured by such grant of extension of time , failing which, the sum of Four Hundred Thousand and 00/100 Dollars ($400,000.00) shall be immediately due and payable to the Holder, together with a default penalty in the amount of Forty-Five Thousand Dollars ($45,000), and thereupon default interest shall begin to accrue at the annual rate of eighteen (18%) percent per annum and the Holder shall be entitled to all remedies under the law and as set forth in the Guarantee or the Pledge Agreement.
Section 6. Interest Rate Limitation. The parties intend to conform strictly to the applicable usury laws in effect from time to time during the term of the Loan. Accordingly, if any transaction contemplated hereby would be usurious under such laws, then notwithstanding any other provision hereof: (i) the aggregate of all interest that is contracted for, charged, or received under this Note or under any other document shall not exceed the maximum amount of interest allowed by applicable law, (the "Highest Lawful Rate"), and any excess shall be credited to the Maker by the Holder forthwith thereafter (or, to the extent that such consideration shall have been paid, such excess shall be refunded to the Maker by the Holder forthwith); (ii) neither the Maker nor any other person now or hereafter liable hereunder shall be obligated to pay the amount of such interest to the extent that it is in excess of the Highest Lawful Rate; and (iii) the effective rate of interest shall be reduced to the Highest Lawful Rate. All sums paid, or agreed to be paid, to the Holder for the use, forbearance, and detention of the debt of the Maker to the Holder shall, to the extent permitted by applicable law, be allocated throughout the full term of the Note until payment is made in full so that the actual rate of interest does not exceed the Highest Lawful Rate in effect at any particular time during the full term thereof. If the total amount of interest paid or accrued pursuant to this Note under the foregoing provisions is less than the total amount of interest that would have accrued if a varying rate per annum equal to the interest rate under the Note had been in effect, then the Maker agrees to pay to the Holder an amount equal to the difference between (x) the lesser of (A) the amount of interest that would have accrued if the Highest Lawful Rate had at all times been in effect, or (B) the amount of interest that would have accrued if a varying rate per annum equal to the interest rate under this Note had at all times been in effect, and (y) the amount of interest accrued in accordance with the other provisions of this Note.
Section 7. Prepayment/Extension.
(a) The Maker shall have the right to prepay this Note in whole or in part prior to the Maturity Date.
(b) The Maker shall give at least ten (10) Days, but not more than fifteen (15) Days, written notice of any intention to prepay this Note prior to the Maturity Date or any extension thereof to the Holder, which notice shall specify the "Prepayment Date".
Section 8. Definitions. For the purposes hereof, the following terms shall have the following meanings:
"Business Day" means any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in the State of New York are authorized or required by law or other government action to close.
"Change of Control Transaction" means the occurrence of any of (i) an acquisition after the date hereof by an individual or legal entity or "group" (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act) of in excess of 49% of the voting securities of a person, coupled with a replacement of more than one-half of the members of such person's board of directors which is not approved by those individuals who are members of the board of directors on the date hereof in one or a series of related transactions, or (ii) the merger of such person with or into another entity, consolidation or sale of all or substantially all of the assets of such person in one or a series of related transactions, unless following such transaction, the holders of such person's securities continue to hold at least 40% of such securities following such transaction. The execution by such person of an agreement to which such person is a party or by which it is bound providing for any of the events set forth above in (i) or (ii) does not constitute the occurrence of the event until after the event in fact occurs.
"Common Stock" means the Common Stock of Hutech21 Co. Ltd., a British Virgin Islands company.
Section 9. Except as expressly provided herein, no provision of this Note shall not alter or impair the obligation of the Maker, which is absolute and unconditional, to pay the principal of interest and liquidated damages (if any) on, this Note at the time, place, and rate, and in the coin or currency, herein prescribed. This Note is a direct obligation of the Maker.
Section 10. If this Note shall be mutilated, lost, stolen or destroyed, the Maker shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed Note, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such Note, and of the ownership hereof, and indemnity, if requested, all reasonably satisfactory to the Maker.
Section 11. Choice of Law and Venue; Submission to Jurisdiction; Service of Process.
(a) THE VALIDITY OF THIS NOTE , ITS CONSTRUCTION, INTERPRETATION AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA (WITHOUT REFERENCE TO THE CHOICE OF LAW PRINCIPLES THEREOF). THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS NOTE SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF BROWARD, STATE OF FLORIDA OR, AT THE SOLE OPTION OF THE HOLDER, IN ANY OTHER COURT IN WHICH HOLDER SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY.
(b) THE MAKER HEREBY SUBMITS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION.
(c) THE MAKER HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT, OR OTHER PROCESS ISSUED IN ANY ACTION OR PROCEEDING AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT, OR OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO MAKER.
(d) NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO AFFECT THE RIGHT OF THE HOLDER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW, OR TO PRECLUDE THE ENFORCEMENT BY HOLDER OF ANY JUDGMENT OR ORDER OBTAINED IN SUCH FORUM OR THE TAKING OF ANY ACTION UNDER THIS AGREEMENT TO ENFORCE SAME IN ANY OTHER APPROPRIATE FORUM OR JURISDICTION.
(e) TO THE EXTENT DETERMINED BY SUCH COURT, THE MAKER SHALL REIMBURSE THE HOLDER FOR ANY REASONABLE LEGAL FEES AND DISBURSEMENTS INCURRED BY THE HOLDER IN ENFORCEMENT OF OR PROTECTION OF ANY OF ITS RIGHTS UNDER ANY OF THIS NOTE.
Section 12. Any waiver by the Maker or the Holder of a breach of any provision of this Note shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Note. The failure of the Maker or the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Note. Any waiver must be in writing.
Section 13. If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances.
Section 14. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day (or, if such next succeeding Business Day falls in the next calendar month, the preceding Business Day in the appropriate calendar month).
Section 15. Security. The obligation of the Maker for payment of principal, interest and all other sums hereunder, in the event of a default and failure of the Maker to perform hereunder, is secured by (i) a Guarantee of the Guarantor, and (ii) the pledge of certain securities (the "Pledged Shares") by the Guarantor as Pledgor under the terms and conditions of a Stock Pledge Agreement.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
| (1) |
IN WITNESS WHEREOF, the Maker has caused this instrument to be duly executed, as of the date first above indicated.
TAEHOAN PARK
S: /s/ Taehoan Park
Name: Taehoan Park
Attest:
By:
| (2) |
SCHEDULE A
PLAN OF REPAYMENT
The loan will be repaid out of profits from Hutech21 Co. Ltd. Or its subsidiaries per the following payment terms:
STOCK PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT ("Agreement") is entered into as of July 1, 2011 by and among Precursor Management Inc. (the "Secured Party"), and Taehoan Park an individual residing in the Republic of Korea (the “Pledgor").
RECITALS
A. The Pledgor has agreed to pledge certain securities to secure performance of his obligations under Note, No. 011911 in the aggregate face amount of Four Hundred Thousand Dollars ($400,000.00) payable to the Secured Party (the "Note"). Capitalized terms in this Agreement which are not identified herein will have the meanings given such terms in the Note.
NOW, THEREFORE, in consideration of the premises, the mutual covenants and conditions contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
1. Grant of Security Interest True-up of Collateral. The Pledgor hereby pledges to the Secured Party as collateral and security for the Secured Obligations (as defined in Section 2) the securities, issued by Hutech21 Co. Ltd., a British Virgin Islands company; also referred to as the "Issuer" and initially set forth on the attached Schedule 1 of this Agreement. Unless otherwise set forth on Schedule 1 of this Agreement, the Pledgor is the beneficial and record owner of the Pledged Shares set forth on such Schedule. Such Pledged Shares, together with any additions, replacements, accessions or substitutes therefore or proceeds thereof, are hereinafter referred to collectively as the "Collateral." For purposes of this Section 1, the Market Value of the Collateral shall be calculated as the average of the volume weighted average prices for the Common Stock for the five (5) trading days immediately preceding the date on which it is measured, as reported by Bloomberg L.P. The value of any additional shares delivered into escrow as provided above shall be deemed to be the Market Value on the date on which the deficiency shall have occurred.
2. Secured Obligations. During the term hereof, the Collateral shall secure the performance by the Pledgor of its obligations, covenants, and agreements under this Pledge Agreement and the performance of its Obligations under the Note (the "Secured Obligations").
3. Assignment. Subject only to occurrence of events of default as specified in the note and upon exercise of its rights by the Secured Party under this Agreement, the Secured Party may assign or transfer the whole or any part of his security interest granted hereunder, and may transfer as collateral security the whole or any part of his security interest in the Collateral. The secured party is strictly prohibited to use or dispose of the Pledged Shares for the purpose of short financing or any kind of fund raising activities whereby the Pledged Shares are to be used as securities or otherwise the Pledged Shares will be encumbranced therefore.
4. The Pledgor' s Warranty. A. Title. The Pledgor represents and warrants hereby to the Secured Party as follows with respect to the Pledged Shares:
(i) The Collateral is free and clear of any encumbrances of every nature whatsoever, and the Pledgor is the sole owner of the Pledged Shares;
(ii) The Pledgor further agrees not to grant or create, any security interest, claim, lien, pledge or other encumbrance with respect to such Collateral or attempt to sell, transfer or otherwise dispose of the Collateral, until the Secured Obligations have been paid in full or this Agreement terminates; and
(iii) This Agreement constitutes a legal, valid and binding obligation of the Pledgor enforceable in accordance with its terms (except as the enforcement thereof may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium, and similar laws now or hereafter in effect),
B. Other. (i) The Pledgor has made necessary inquiries of both of the Issuers and believes that each of them fully intends to fulfill and has the capability of fulfilling the Secured Obligations to be performed by the Issuer in accordance with the terms of the Note.
(ii) The Pledgor is not acting, and has not agreed to act, in any plan to sell or dispose of any Pledged Shares in a manner intended to circumvent the registration requirements of the Securities Act of 1933, as amended, or any applicable state law.
(iii) The Pledgor has been advised by counsel of the elements of a bona-fide pledge for purposes of Rule 144(d)(3)(iv) under the Securities Act of 1933, as amended, including the relevant SEC interpretations, and affirms that the pledge of shares by the undersigned pursuant to this Pledge Agreement will constitute a bona-fide pledge of such shares for purposes of such Rule.
5. Collection of Dividends and Interest. During the term of this Agreement and so long as the Pledgor is not in default under the Note, the Pledgor is entitled to receive all dividends, distributions, interest payments, and other amounts that may be, or may become, due on any of the Collateral.
6. Preservation of the Value of the Collateral. The Pledgor shall pay all taxes, charges, and assessments against the Collateral and do all acts necessary to preserve and maintain the value thereof.
7. Remedies upon Default. Upon the occurrence and during the continuance of an Event of Default under the Note ("Event of Default"):
(a) The Secured Party may exercise in respect of the Collateral, all the rights and remedies of a Secured Party upon default under the law (irrespective of whether the law applies to the affected items of Collateral), and the Secured Party may by notice to the Pledgor (except as specified below) propose to sell the Collateral or any part thereof in one or more parcels at public or private sale, at any exchange, broker's board or at any of the Secured Party's offices or elsewhere, for cash, on credit or for future delivery, at such time or times at their prevailing market price and upon such other terms as the Secured Party may deem commercially reasonable, To the maximum extent permitted by applicable law, the Secured Party may be the purchaser of any or all of the Collateral at any such arms-length sale and shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such public sale at their prevailing market value, to use and apply all or any part of the Secured Obligations as a credit on account of the purchase price of any Collateral payable at such sale. Each purchaser at any such arms-length sale shall hold the property sold absolutely free from any claim or right on the part of the Pledgor, The Pledgor agrees that, to the extent notice of sale shall be required by law, at least twenty-one (21) calendar days notice to the Pledgor of the time and place of any public sale or the time after which a private sale (arms-length sale)is to be made shall constitute reasonable notification. The Secured Party shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Secured Party may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, with further notice to the Pledgor, be made at the time and place to which it was so adjourned. To the maximum extent permitted by law, The Pledgor hereby reserves any claims against the Secured Party arising because the price at which any Collateral may have been sold at such a private sale was less than the price that might have been obtained at a public sale, including the Secured Party accepts the first offer received and does not offer such Collateral to more than one offeree.
(b) The Pledgor hereby acknowledges that the sale by the Secured Party of any Collateral pursuant to the terms hereof in compliance with the Securities Act of 1933, as amended, as now in effect or as hereafter amended, or any similar statute hereafter adopted with similar purpose or effect (the "Securities Act"), as well as applicable "Blue Sky" or other state securities laws, may require strict limitations as to the manner in which the Secured Party or any subsequent transferee of the Collateral may dispose thereof. The Secured Party shall be obliged to obtain the maximum possible price for the Collateral.
(c) If the Secured Party shall determine to exercise its right to sell all or any portion of the Collateral pursuant to this Agreement, then the Pledgor agrees that, upon request of the Secured Party, the Pledgor, at its own expense, shall:
(i) execute and deliver, or cause the officers and directors of the Issuer to execute and deliver, to any person, entity or governmental authority as the Secured Party may choose, all necessary documents which, in the Secured Party's reasonable judgment, may be necessary or appropriate for approval, or be required by, any regulatory authority located in any city, county, state or country where the Pledgor engages in business, in order to transfer or to more effectively transfer the Pledged Interests or otherwise enforce the Secured Party's rights hereunder; and
(ii) do or cause to be done all such other acts and things as may be necessary to make such sale of the Collateral or any part thereof valid and binding and in compliance with applicable law; and
(iii) cause the Pledgor to timely file all periodic reports required to be filed by the Pledgor under the Securities Exchange Act of 1934, as amended.
8. (a) Term of Agreement. This Agreement shall continue in full force and effect until payment in full of the Note. Upon payment in full of the Note, the security interests in the relevant Collateral shall be deemed to have been released and this Agreement shall be deemed to have been discharged and ineffective, and the Collateral or any portion of the Collateral not transferred to or sold by the Secured Party shall be returned to the Pledgor forthwith. Upon termination of this Pledge Agreement, the relevant Collateral shall be returned within five (5) trading days to the Pledgor, as contemplated above.
(b) Application of Proceeds. Upon the occurrence and during the continuance of an Event of Default, any cash held by the Secured Party as Collateral and all cash proceeds received by the Secured Party in respect of any sale of, collection from, or other realization upon all or any part of the Collateral pursuant to the exercise by the Secured Party of its remedies as a secured creditor as provided in Section 11 shall be applied from time to time by the Secured Party as provided in the Note. The Secured Party shall account for and refund the surplus of the proceeds to the Pledgor, if any.
9. Indemnity and Expenses. Subject to occurrence of events of default, the Pledgor agrees:
(a) To indemnify and hold harmless the Secured Party from and against all reasonable loss and damage (including, without limitation, reasonable attorneys' fees and expenses) in any way arising out of or in connection with this Agreement or the Secured Obligations, except to the extent the same shall arise as a result of the gross negligence or willful misconduct of the party seeking to be indemnified; and
(b) To pay and reimburse the Secured Party upon demand for all reasonable costs and expenses (including, without limitation, reasonable attorneys' fees and expenses) that the Secured Party may necessarily incur in connection with (i) the custody, use or preservation of, or the sale of, collection from or other realization upon, any of the Collateral, including the reasonable expenses of re-taking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the Collateral, (ii) the exercise or enforcement of any rights or remedies granted hereunder, under the Note or otherwise available to it (whether at law, in equity or otherwise),
10. Choice of Law and Venue; Submission to Jurisdiction; Service of Process.
(a) THE VALIDITY OF THIS AGREEMENT, ITS CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA (WITHOUT REFERENCE TO THE CHOICE OF LAW PRINCIPLES THEREOF). THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF BROWARD, STATE OF FLORIDA OR, AT THE SOLE OPTION OF THE SECURED PARTY, IN ANY OTHER COURT IN WHICH THE SECURED PARTY SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY.
(b) THE PLEDGOR HEREBY SUBMITS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION.
(c) THE PLEDGOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT, OR OTHER PROCESS ISSUED IN ANY ACTION OR PROCEEDING AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT, OR OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE PLEDGOR
(d) NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO AFFECT THE RIGHT OF THE SECURED PARTY TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW, OR TO PRECLUDE THE ENFORCEMENT BY THE SECURED PARTY OF ANY JUDGMENT OR ORDER OBTAINED IN SUCH FORUM OR THE TAKING OF ANY ACTION UNDER THIS AGREEMENT TO ENFORCE SAME IN ANY OTHER APPROPRIATE FORUM OR JURISDICTION.
11. Amendments; etc. No amendment or waiver of any provision of this Agreement nor consent to any departure by the Pledgor herefrom shall in any event be effective unless the same shall be in writing and signed by the Secured Party and the Pledgor, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. No failure on the part of the Secured Party to exercise, and no delay in exercising any right under this Agreement, any other document or documents delivered in connection with the transactions contemplated by the Note, this Agreement or any of the three guarantees being delivered in connection herewith (the "Guarantees") of even date herewith (all such documents, including the Note, this Agreement and the Guarantees are hereinafter referred to collectively as the "Loan Documents", and each individually as a "Loan Document"), or otherwise with respect to any of the Secured Obligations, shall operate as a waiver thereof; nor shall any single or partial exercise of any right under this Agreement, any other Loan Document, or otherwise with respect to any of the Secured Obligations preclude any other or further exercise thereof or the exercise of any other right. The remedies provided for in this Agreement or otherwise with respect to any of the Secured Obligations are cumulative and not exclusive of any remedies provided by law.
12. Notices. Unless otherwise specifically provided herein, all notices shall be in writing addressed to the respective party as set forth below: and may be personally served, faxed, telecopied or sent by overnight courier service or United States mail:
If to the Pledgor:
Hutech21 Co. Ltd.
#201 Daerungtechnotown III
Gasan-Dong Geumcheon-Gu,
Seoul Korea 153-772
If to the Secured Party:
Precursor Management, Inc.
2702-03, 27/F, Goldlion Digital Network Center
138 Tiyu Road East, Tianhe
Guangzhou, P.R. China 510620
Any notice given pursuant to this Section 12 shall be deemed to have been given: (a) if delivered in person, when delivered; (b) if delivered by fax, on the date of transmission if transmitted on a Business Day before 4:00 p.m. at the place of receipt or, if not, on the next succeeding Business Day (as defined in the Note); (c) if delivered by overnight courier, two (2) days after delivery to such courier properly addressed; or (d) if by United States mail, four (4) Business Days after depositing in the United States mail, with postage prepaid and properly addressed. Any party hereto may change the address or fax number at which it is to receive notices hereunder by notice to the other party in writing in the foregoing manner.
13. Continuing Security Interest. This Agreement shall create a continuing security interest in the Collateral and shall: (a) remain in full force and effect until the indefeasible payment in full of the Secured Obligations, including the cash collateralization, expiration, or cancellation of all Secured Obligations, if any, consisting of letters of credit, and the full and final termination of any commitment to extend any financial accommodations under the Note; (b) be binding upon the Pledgor and its successors and assigns; and (c) inure to the benefit of the Secured Party and his successors, transferees, and assigns. Upon the indefeasible payment in full of the Secured Obligations, including the cash collateralization, expiration, or cancellation of all Secured Obligations, if any, consisting of letters of credit, and the full and final termination of any commitment to extend any financial accommodations under the Note, the security interests granted herein shall automatically terminate and all rights to the Collateral shall revert to the Pledgor forthwith. Upon any such termination, the Secured Party, at the Pledgor's expense, shall execute and deliver to the Pledgor such documents as the Pledgor shall reasonably request to evidence such termination. Such documents shall be prepared by the Pledgor and shall be in form and substance reasonably satisfactory to the Secured Party.
14. Security Interest Absolute. To the maximum extent permitted by law, all rights of the Secured Party, all security interests hereunder, and all obligations of the Pledgor hereunder, shall be absolute and unconditional irrespective of
(a) any lack of validity or enforceability of any of the Secured Obligations or any other agreement or instrument relating thereto, including any of the Loan Documents;
(b) any change in the time, manner, or place of payment of, or in any other term of, all or any of the Secured Obligations, or any other amendment or waiver of or any consent to any departure from any of the Credit Documents, or any other agreement or instrument relating thereto;
(c) any exchange, release, or non-perfection of any other collateral, or any release or amendment or waiver of or consent to departure from any Guarantee for all or any of the Secured Obligations;
(d) any other circumstances that might otherwise constitute a defense available to, or a discharge of, the Pledgor.
15. Headings. Section and subsection headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement or be given any substantive effect.
16. Severability. In case any provision in or obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.
17. Counterparts; Telefacsimile Execution. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same Agreement. Delivery of an executed counterpart of this Agreement by telefacsimile shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by telefacsimile also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, or binding effect hereof.
IN WITNESS WHEREOF, the Pledgor and the Secured Party have caused this Agreement to be duly executed and delivered by their officers thereunto duly authorized as of the date first written above.
PLEDGOR
Signed: /s/ Taehoan Park
Name: Taehoan Park
SECURED PARTY
PRECURSOR MANAGEMENT, INC.
By: /s/ Weiheng Cai
Name: Weiheng Cai
President
SCHEDULE 1
Pledged Interests:
A) 10,000,000 shares of Preferred Stock
Name of Issuer: Hutech21 Co. Ltd. (F/K/A China Logistics, Inc.)
Jurisdiction of Organization: British Virgin Islands
Type of Interest: Shares of Preferred Stock
Number of Shares/Units outstanding (if applicable): 10,000,000 shares of Preferred Stock
Certificate Number(s) (if any):
Percentage of Outstanding Interests in Issuer: Voting Control
Date Acquired: July 1, 2011
For Pledgor
Mr. Taehoan Park
GUARANTY
THIS GUARANTY is dated as of July 1, 2011 ("Guaranty") and made by Hutech21 Co. Ltd. (F/K/A China Logistics, Inc.), a British Virgin Islands corporation with offices at #201 Daerungtechnotown III Gasan-Dong Geumcheon-Gu, Seoul Korea 153-772 (the "Guarantor"), in favor of Precursor Management Inc., a corporation organized under the laws of the British Virgin Islands, with offices at 2702-03, 27/F, Goldlion Digital Network Center, 138 Tiyu Road East, Tianhe, Guangzhou, P.R. China (the "Lender").
WITNESSETH
WHEREAS, Taehoan Park, an individual residing in the Republic of Korea (the "Borrower"), and the Lender are parties to a note, dated as of January 19, 2011 referred to as the Series 2011 Secured Note Due January 19, 2012 (such note, as amended, restated, supplemented or otherwise modified from time to time, being hereinafter referred to as the "Note");
WHEREAS, pursuant to the Note and this Guaranty entered into by the Guarantor, the Guarantor is required to execute and deliver to the Lender a guaranty that the Note and all other obligations under the Note and the pledge agreement by and between the Pledgor thereunder and the Lender of even date herewith (such pledge agreement, as amended, restated, supplemented or otherwise modified from time to time, being hereinafter referred to as the "Pledge Agreement"; the Note, the Guaranty, and the Pledge Agreement, together with all other documents required to be delivered in connection herewith and therewith are collectively referred to as the "Loan Documents"); and
NOW, THEREFORE, in consideration of the premises and the agreements herein, the Guarantor hereby agrees with the Lender, as follows:
Section 1. Definitions. Reference is hereby made to the Note for a statement of the terms thereof. All terms used in this Guaranty which are defined in the Note and not otherwise defined herein shall have the same meanings herein as set forth therein. As used in this Guaranty, the following terms have the following meanings (terms defined in the singular to have the same meaning when used in the plural):
"Borrower" has the meaning specified in the preamble above.
"Guaranty" means this Guaranty.
"Guaranteed Obligations" means the obligation of the borrower for repayment of the loan as referred to in the Note.
“Note” refers to that certain secured promissory note dated January 19, 2011.
Section 2. Rules of Interpretation. When used in this Guaranty: (1) "or" is not exclusive, (2) a reference to a law or document includes any amendment or modification to such law or document and (3) a reference to an agreement, instrument or document includes any amendment or modification of such agreement, instrument or document.
Section 3. Guaranty. The Guarantor hereby guarantees to the Lender and his successors, endorsees, transferees and assigns the prompt and complete payment, as and when due and payable in accordance with the terms of the Note or of all of the Guaranteed Obligations now existing will be paid strictly in accordance with their terms.
Section 4. Limitation of Liability. The obligation of the Guarantor under this Guaranty shall be limited to an aggregate amount equal to the principal plus interest and default penalties, if applicable, as such amount is set forth under the Note and subject to avoidance under Section 548 of the United States Bankruptcy Code or any comparable provision of any applicable state or international law.
Section 5. Type of Guaranty. This Guaranty is absolute and unconditional and as such is not subject to any conditions and the Guarantor is fully liable to perform all of its duties and obligations under this Guaranty as of the date of execution of this Guaranty. This Guaranty is a continuing guaranty and applies to all future Guaranteed Obligations. This Guaranty is a guaranty of payment only. The obligations and liabilities of the Guarantor under this Guaranty shall not be conditioned or contingent upon the pursuit by the Lender of any right or remedy against the Borrower, the Guarantor or any other person which may be or become liable in respect of all or any part of the Guaranteed Obligations, or against any assets securing the payment of the Guaranteed Obligations or guarantee for such Guaranteed Obligations or right of setoff with respect to such Guaranteed Obligations. This Guaranty is irrevocable and as such cannot be canceled, terminated or revoked by the Guarantor.
Section 6. Security Interest. To secure the payment of the obligations of the Guarantor under this Guaranty, the Guarantor has executed an Affidavit of Confession of Judgment in the form annexed hereto as Exhibit 1.
Section 7. Notices. Reasonable notices are required to be given by the Lender to the Guarantor that cover all notices including (1) notice of any actions taken by the Lender, the Borrower, the Guarantor or any other person under any Guaranty Document, and (2) notices of nonpayment or nonperformance, notices of protest and notices of dishonor.
Section 8. Waiver of Defenses. The Guarantor hereby waives any and all defenses to the performance by the Guarantor of its duties and obligations under this Guaranty subject to events of default, including any defense based on any of the following:
(1) any failure of the Lender to disclose to the Guarantor any information relating to the business, condition (financial or otherwise), operations, performance, properties or prospects of any party obligated to make payment on any and all Guaranteed Obligations, whether as principal or guarantor, now or hereafter known to the Lender,
(2) any exchange or release of, or non-perfection of any security interest on or in any assets securing the payment of the Guaranteed Obligations,
(3)
any subordination of any or all of the Guaranteed Obligations with notice to the
Guarantor,
(4) any act or omission of the Lender in connection with the enforcement of, or the exercise of rights and remedies, including any election of, or the order of exercising any, remedies, with respect to (a) the Guaranteed Obligations, (b) any other guarantor of the Guaranteed Obligations, or (c) any assets securing the payment of the Guaranteed Obligations,
Section 9. Subrogation. The Guarantor may not exercise any rights which the Guarantor may acquire by way of subrogation or contribution, whether acquired by any payment made under this Guaranty, by any setoff or application of funds of the Borrower, by the Lender or otherwise, until (1) the payment in full of the Guaranteed Obligations (after the Lender no longer has any obligation or arrangement to provide credit to the Borrower, including under or pursuant to a line of credit), and (2) the payment of all fees and expenses to be paid by the Guarantor pursuant to this Guaranty. If any amount shall be paid to the Guarantor on account of such subrogation or contribution rights at any time when all of the Guaranteed Obligations and all such other expenses shall not have been paid in full (after the Lender no longer has any obligation or arrangement to provide credit to the Borrower, including under or pursuant to a line of credit), such amount shall be held in trust for the benefit of the Lender, shall be segregated from the other funds of the Guarantor and shall forthwith be paid over to the Lender to be credited and applied in whole or in part by the Lender against the Guaranteed Obligations, whether matured or unmatured, and all such other fees and expenses in accordance with the terms of the Loan Documents.
Section 10. Representations. At the time of execution of this Guaranty and each time the Lender provides credit as noted above, the Guarantor represents and warrants to the Lender as follows:
(1) Name. The exact legal name of the Guarantor is the name specified in the preamble to this Guaranty. The Guarantor has not been known by any other names during the two (2) years prior to the date of the Guaranty unless otherwise disclosed to the Lender.
(2) Location. The principal location of the Guarantor is as specified in the preamble to this Guaranty.
(3) No Contravention. The execution, delivery and performance by the Guarantor of this Guaranty do not and will not (a) violate any provision of any law, order, writ, judgment, injunction, decree, determination, or award presently in effect applicable to the Guarantor, (b) result in a breach of or constitute a default under any indenture or loan or credit agreement or any other agreement, lease, or instrument to which the Guarantor is a party or by which the Guarantor or its properties may be bound or affected, or (c) result in, or require, the creation or imposition of any lien upon or with respect to any of the properties now owned or hereafter acquired by the Guarantor.
(4) Governmental Authority. No authorization, approval or other action by, and no notice to or filing with, any governmental authority is required for the due execution, delivery and performance by the Guarantor of this Guaranty.
(5) Legally Enforceable Guaranty. This Guaranty is the legal, valid and binding obligation of the Guarantor, enforceable against the Guarantor in accordance with its terms, except to the extent that such enforcement may be limited by (a) applicable bankruptcy, insolvency, and other similar laws affecting creditors' rights generally, or (b) general equitable principles, regardless of whether the issue of enforceability is considered in a proceeding in equity or at law.
Section 11. Remedies. The Lender shall not, by any act, delay, omission or otherwise, be deemed to have waived any of its rights or remedies under this Guaranty or otherwise. A waiver by the Lender of any right or remedy hereunder on any one occasion, shall not be construed as a ban or waiver of any such right or remedy which the Lender would have had on any future occasion, nor shall the Lender be liable for exercising or failing to exercise any such right or remedy. The rights and remedies of the Lender under this Guaranty are cumulative and, as such, are in addition to any other rights and remedies available to the Lender under law or any other agreements.
Section 12. Indemnity and Expenses. The Guarantor hereby indemnifies the Lender from and against any and all claims, losses, damages and liabilities arising out of or resulting from this Guaranty (including, without limitation, enforcement of this Guaranty), except claims, losses, damages or liabilities resulting from the Lender's gross negligence and willful misconduct.
The Guarantor will upon demand pay to the Lender the amount of any and all expenses, including the fees and expenses of its counsel and of any experts and agents, which the Lender may incur in connection with (3) the exercise or enforcement of any of the rights of the Lender under this Guaranty,
Section 13. Amendments. No amendment or waiver of any provision of this Guaranty, nor consent to any departure by the Guarantor from this Guaranty, shall in any event be effective unless the same shall be in writing and signed by the Guarantor and the Lender, and then such amendment or waiver shall be effective only in the specific instance and for the specific purpose for which given.
Section 14. Addresses for Notices. All notices and other communications provided for under this Guaranty shall be in writing and, mailed or delivered by messenger or overnight delivery service, addressed, in the case of the Guarantor at its address specified below its signature, and in the case of the Lender at the address specified below, or as to any such party at such other address as shall be designated by such party in a written notice to the other party complying as to delivery with the terms of this Section.
If to the Lender:
Precursor Management, Inc.
2702-03, 27/F, Goldlion Digital Network Center
138 Tiyu Road East, Tianhe
Guangzhou, P.R. China 510620
If to the Guarantor:
Hutech21 Co. Ltd.
#201 Daerungtechnotown III
Gasan-Dong Geumcheon-Gu,
Seoul Korea 153-772
All such notices and other communications shall, when mailed, be effective three (3) days after being placed in the mails, or when delivered to a messenger or overnight delivery service, be effective one (1) day after being delivered to the messenger or overnight delivery service, in each case, addressed as specified above.
Section 15. Assignment and Transfer of Obligations. This Guaranty will bind the estate of the Guarantor as to Guaranteed Obligations to the extent of the limited liabilities as referred to in Section 4 hereof created or incurred both before and after the bankruptcy or liquidation of the Guarantor, whether or not the Lender receives notice of such bankruptcy or liquidation. This Guaranty shall inure to the benefit of the Lender and his successors, transferees and assigns. The Guarantor may not transfer or assign its obligations under this Guaranty. The Lender may assign or otherwise transfer all or a portion of his rights or obligations with respect to the Guaranteed Obligations to any other party subject to due notice being given to the Guarantor, and such other party shall then become vested with all the benefits in respect of such transferred Guaranteed Obligations granted to the Lender in this Guaranty or otherwise. The Guarantor agrees that the Lender can provide information regarding the Guarantor to any prospective or actual successor, transferee or assign subject to the principles of confidentiality..
Section 16. Setoff. The Guarantor agrees that, in addition to, and without limiting, any right of setoff, the Lender's lien or counterclaim the Lender may otherwise have, the Lender shall be entitled, at its option, to offset balances (general or special, time or demand, provisional or final) held by it for the account of the Guarantor to the extent of the limited liabilities as referred to in Section 4 hereof, at any of the offices of the Lender, in Dollars or any other currency, against any amount payable by the Guarantor to the Lender under this Guaranty which is not paid when demanded (regardless of whether such balances are then due to the Guarantor), in which case the Lender shall promptly notify the Guarantor, provided that the Lender's failure to give such notice shall not affect the validity of such offset.
Section 17. Submission to Jurisdiction. The Guarantor hereby irrevocably submit to the exclusive jurisdiction of any federal or state court sitting in the county of Broward, State of Florida over any action or proceeding arising out of or related to this Guaranty and agrees with the Lender that personal jurisdiction over the Guarantor rests with such courts for purposes of any action on or related to this Guaranty. The Guarantor hereby waives personal service by manual delivery and agrees that service of process may be made by prepaid certified mail directed to the Guarantor at the address of the Guarantor for notices under this Guaranty or at such other address as may be designated in writing by the Guarantor to the Lender, and that upon mailing of such process such service will be effective as if the Guarantor were personally served. The Guarantor agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any manner provided by law. The Guarantor further waives any objection to venue in any such action or proceeding on the basis of inconvenient forum. The Guarantor agrees that any action on or proceeding brought against the Lender shall only be brought in such courts.
Section 18. Governing Law. This Guaranty shall be governed by and construed in accordance with the laws of the State of Florida without regard to its principles of conflicts of law.
Section 19. Subordination. Once a demand for payment is made on the Guarantor under this Guaranty, the Guarantor will not (1) make any demand for payment of, or take any action to accelerate, any obligation owed to the Guarantor by the Borrower, (2) seek to collect payment of, or enforce any right or remedies against the Borrower, any of the obligations owed to the Guarantor by the Borrower or any guarantees, credit supports, collateral or other security related to or supporting any of such obligations, or (3) commence, or join with any other creditor in commencing, any bankruptcy or similar proceeding against the Borrower. The Guarantor also agrees that the payment of all obligations of the Borrower to the Guarantor shall be subordinate and junior in time and right of payment in accordance with the terms of this Section 19 to the prior payment in full (in cash) of the Guaranteed Obligations. In furtherance of such subordination, (1) to the extent possible, the Guarantor will not take or receive from the Borrower any payments, in cash or any other property, by setoff or any other means, of any or all of the obligations owed to the Guarantor by the Borrower, or purchase, redeem, or otherwise acquire any of such obligations, or change the terms or provisions of any such obligations and (2) if for any reason and under any circumstance the Guarantor receives a payment on such obligation, whether in a bankruptcy or similar proceeding or otherwise, all such payments or distributions upon or with respect to such obligations shall be received in trust for the benefit of the Lender, shall be segregated from other funds and property held by the Guarantor and shall be forthwith paid over to the Lender in the same form as so received (with any necessary endorsement) to be applied (in the case of cash) to, or held as collateral (in the case of securities or other non-cash property) for, the payment or prepayment of the Guaranteed Obligations.
Section 20. Miscellaneous. This Guaranty is in addition to and not in limitation of any other rights and remedies the Lender may have by virtue of any other instrument or agreement previously, contemporaneously or hereafter executed by the Guarantor or any other party or by law or otherwise. If any provision of this Guaranty is contrary to applicable law, such provision shall be deemed ineffective without invalidating the remaining provisions of this Guaranty. Titles in this Guaranty are for convenience of reference only and shall not affect the interpretation or construction of this Guaranty. This Guaranty constitutes the entire agreement between the Guarantor and the Lender with respect to the matters covered by this Guaranty and supersedes all written or oral agreements with respect to such matters.
IN WITNESS 'WHEREOF, the Guarantor has duly executed and delivered this Guaranty as of the date of this Guaranty.
HUTECH21 CO. LTD.
By: /s/ Taehoan Park
Name: Taehoan Park
Title: CEO
Attest:________________________
By: