UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): June 11, 2017
CLEANTECH SOLUTIONS INTERNATIONAL, INC.
(Exact name of registrant as specified in Charter)
| Nevada | 001-34591 | 90-0648920 | ||
|
(State or other jurisdiction of incorporation or organization) |
(Commission File No.) | (IRS Employee Identification No.) |
No. 9 Yanyu Middle Road
Qianzhou Village, Huishan District, Wuxi City
Jiangsu Province, People’s Republic of China
(Address of Principal Executive Offices)
(86) 51083397559
(Registrant’s Telephone number)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b))
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Item 8.01 Other Events
On June 11, 2017, Cleantech Solutions International, Inc. (the “Company”) entered into an Exclusivity Agreement (the “Agreement”) with ECrent Capital Holdings Limited (“ECrent”) the terms of which became effective on the same day. Pursuant to the Agreement, the Company and ECrent agreed to engage in exclusive discussions regarding a potential acquisition by the Company of ECrent and/or any of its subsidiaries or otherwise all or part of ECrent’s business and potential business cooperation between the two companies (collectively, the “Potential Transactions”) for a period of three months commencing from the date of the Agreement (the “Exclusive Period”). Ms. Deborah Yuen, an affiliate of YSK 1860 Ltd., which is a principal shareholder of the Company, controls ECrent Holdings Limited, which is the majority shareholder of ECrent. ECrent agreed that, during the Exclusive Period, neither ECrent nor its agents, representatives or advisors will contact, solicit, discuss or negotiate with any third party with respect to any transaction relating to a transfer or pledge of securities of ECrent and/or its subsidiaries, a sale of ECrent’s business, a business cooperation or any other matters that may adversely affect the Potential Transactions or the parties’ discussion related thereto.
The parties also agreed to the Company’s establishment of a special committee of the board of directors of the Company that will be composed of disinterested directors in connection with discussions of a Potential Transaction. The Agreement contains a confidentiality provision for the Exclusive Period and two years thereafter. Since the Agreement merely provides for discussions between the Company and ECrent, there can be no assurances that the Company and ECrent may enter into any agreement to do a transaction, and even if an agreement is entered into, there can be no assurances that such transaction will be consummated, or that such transaction will be on terms beneficial to the Company.
A copy of the Agreement and the Company’s press release announcing the Agreement are attached hereto as Exhibit 99.1 and Exhibit 99.2.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description | |
| 99.1 | Exclusivity Agreement dated June 11, 2017 by and between the Company and ECrent Capital Holdings Limited | |
| 99.2 | Press Release, dated June 12, 2017 |
| 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.
| Date: June 15, 2017 | Cleantech Solutions International, Inc. | |
| By: | /s/ Jianhua Wu | |
| Jianhua Wu | ||
| Chief Executive Officer |
3
Exhibit 99.1
Exclusivity Agreement
This Exclusivity Agreement (the “Agreement”), dated as of June 17, 2017, is entered into by and between Cleantech Solutions International, Inc. (“Cleantech”), a company organised and existing under the laws of the state of Nevada, and ECrent Capital Holdings Limited (“ECrent”), a company incorporated in the British Virgin Islands. Cleantech and ECrent are hereinafter referred to as the “Parties” to this Agreement.
WHEREAS,
| A. | ECrent owns and operates certain rental sharing business through a global online platform (the “Business”); and |
| B. | The Parties intend to enter into exclusive discussion related to the Business. |
NOW THEREFORE, in consideration of the mutual covenants herein contained, and other good and valuable consideration, the Parties mutually agree as follows:
| I. | Exclusive Discussion |
1. The Parties hereby agree to engage in exclusive discussion (the “Discussion”) regarding (a) a potential acquisition by Cleantech of ECrent and/or any of its subsidiaries or otherwise all or part of the Business, and/or (b) potential business cooperation arrangements between Cleantech and ECrent (the “Potential Transaction”) during the period commencing on the date hereof and ending on the date that is three (3) months after the date hereof (the “Exclusive Period”). ECrent agrees that, without the prior written consent of Cleantech, during the Exclusive Period, neither ECrent nor its agents, representatives or advisors will contact, discuss or negotiate with any third party (other than those with Cleantech’s authorization) with respect to (i) any transaction relating to the sale, acquisition, exchange, pledge, or transfer of any securities of ECrent and/or its subsidiaries; (ii) any transaction relating to the sale of all or part of the Business; (iii) any business cooperation; or (iv) any other matters that may adversely affect the Potential Transaction or the Discussion.
2. During the Exclusive Period, ECrent shall not, and shall cause its agents, representatives and advisors not to, take any action to initiate, contact, induce, solicit, encourage, participate or assist any person or entity other than Cleantech and its respective affiliates in any offer, inquires, discussions, proposals or negotiations in connection with any transaction, contract, agreement, arrangement or commitments referred to above, and ECrent shall promptly inform Cleantech of any inquiry from any third party in connection therewith.
3. The Parties acknowledge and agree that Cleantech’s board of directors (the “Cleantech Board”) may form a special committee (the “Special Committee”) composed of members of the Cleantech Board that are not affiliated with ECrent to engage in the Discussion. The Special Committee may engage independent financial advisor and legal counsel to assist the Special Committee and Cleantech in the Discussion.
| II. | Confidentiality |
Except as otherwise required by applicable law or regulation, by order of a court of competent jurisdiction, any competent authority or stock exchange, or otherwise permitted by this Agreement, each of Cleantech and ECrent shall not disclose to any third party any content or information in connection with the Discussion, or non-public information relating to the other Party (“Confidential Information”) without the prior consent of the other Party and shall keep Confidential Information strictly confidential. Each Party may disclose Confidential Information to its directors, managers, employees, professional advisers, accountants or lawyers (whether current or prospective) on a need-to-know basis; provided, however, that the disclosing Party shall ensure that such persons are subject to the same confidentiality obligation as they were under this Agreement. To the extent permitted by applicable law, for any Party to disclose Confidential Information to a court, a competent authority or stock exchange, such disclosing Party shall notify the other Party in advance of such disclosure and shall obtain the consent of the other Party with respect to the contents of such disclosure. This confidentiality provision shall survive expiration of the Exclusive Period for two (2) years from the expiration date of the Exclusive Period.
| III. | Miscellaneous |
1. Each Party hereby represents and warrants to the other Party that it has full legal right and authority to execute, deliver and perform fully its obligations under this Agreement. When executed and delivered by the Party, this Agreement shall constitute a valid and binding agreement of each Party, enforceable against such Party in accordance with its terms.
2. This Agreement shall be governed by, and constructed in accordance with, the laws of the State of New York.
3. This Agreement may be executed in any number of counterparts and by the different Parties on separate counterparts, each of which when so executed and delivered shall be an original, but all the counterparts shall together constitute one and the same instrument.
[Signature page follows]
| 2 |
IN WITNESS WHEREOF, the undersigned have executed this Exclusivity Agreement as of the date first set forth above.
| Cleantech Solutions International, Inc. | ||
| By: | ||
| Name: | LAU PING KEE | |
| Title: | Director | |
ECrent Capital Holdings Limited | ||
| By: | ||
| Name: | Liao Jiamei | |
| Title: | Business Development Manager | |
3
Exhibit 99.2
For Immediate Release
Cleantech Solutions International Enters into Agreement
with ECrent (China) for Sharing Economy Platform Development
Wuxi, Jiangsu Province, China – June 12, 2017 – Cleantech Solutions International, Inc. (“Cleantech Solutions” or “the Company”) (NASDAQ: CLNT) today announced that it has entered into exclusive discussions with ECrent Capital Holdings Limited (“ECrent”), a private company incorporated in British Virgin Islands focusing on developing and operating of a global rental platform to promote sharing economy across 30 countries and regions.
The Company’s board of directors plans to form a special committee consisting of independent directors to evaluate and negotiate, on behalf of the Company, the potential acquisition and/or business cooperation transaction(s) with ECrent. The special committee is also expected to engage independent financial and other advisors in connection with such potential transactions. The exclusive period is initially set for three months and may be extended by both parties.
About Cleantech Solutions International
Cleantech Solutions, through its affiliated companies, designs, manufactures and distributes a line of proprietary high and low temperature dyeing and finishing machinery to the textile industry. The Company’s latest business initiatives are focused on targeting the technology and sharing economy markets in China.
About ECrent Capital Holdings Limited
Ecrent Capital Holdings Limited operates ECrent platforms and local business operations across 30 countries and regions, including Greater China, Taiwan, Canada, Brazil, Argentina, Mexico, Thailand, India, Indonesia, Singapore, Malaysia, Philippines, Vietnam, Cambodia, Japan, Korea, Australia, New Zealand, United Kingdom, Germany, France, Poland, Switzerland, Netherlands, Denmark, Russia, Italy, Spain, Portugal, Greece. ECrent promotes sharing economy through rent to reduce environmental damages caused by excessive consumption.
Safe Harbor Statement
This release contains certain "forward-looking statements" relating to the business of the Company and its subsidiary and affiliated companies and certain potential transactions that they may enter into. These forward looking statements are often identified by the use of forward looking terminology such as "believes," "expects" or similar expressions. Such forward looking statements involve known and unknown risks and uncertainties that may cause actual results to be materially different from those described herein as anticipated, believed, estimated or expected. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website, including factors described in "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Form 10-K for the year ended December 31, 2016 and in our Form 10-Q for the quarter ended March 31, 2017. All forward-looking statements attributable to the Company or to persons acting on its behalf are expressly qualified in their entirety by these factors other than as required under the securities laws. The Company does not assume a duty to update these forward-looking statements.
Company Contacts:
Cleantech Solutions International, Inc.
May Liu, Investor Relations
E-mail: ir@cleantechsolutionsinternational.com
+852-31060372
Web: www.cleantechsolutionsinternational.com
Compass Investor Relations
Elaine Ketchmere, CFA
Email: eketchmere@compass-ir.com
+1-310-528-3031
Web: www.compassinvestorrelations.com
###