8-K

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 1934

Date of Report (date of earliest event reported): January 12, 2015

Gulf Resources, Inc.

(Exact name of registrant as specified in charter)

Delaware

(State or other jurisdiction of incorporation)

000-20936 (Commission File Number)   13-3637458 (IRS Employer Identification No.)

Level 11,Vegetable Building, Industrial Park of the East City

Shouguang City, Shandong, 262700, P.R. China

 (Address of principal executive offices and zip code)

+86 (536) 567-0008

 (Registrant's telephone number including area code)

 (Registrant's former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of registrant under any of the following provisions:

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b))

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

1.01 Entry into a Material Definitive Agreement.

On January 12, 2015, Gulf Resources, Inc. (the “Company”) and Shouguang City Haoyuan Chemical Company Limited, a wholly owned subsidiary of the Company (“SCHC”), entered into an Equity Interest Transfer Agreement (the “Agreement”) with Shouguang City Rongyuan Chemical Co, Ltd. (“SCRC”) and its shareholders, pursuant to which SCHC shall, upon closing, acquire SCRC and all rights, title and interest in and to all assets owned by SCRC, a leading manufacturer of materials for human and animal antibiotics in China and other parts of Asia.

In consideration for SCRC, SCHC shall pay $66.2 million in cash and issue approximately 7.27 million shares of common stock at a price of $2.00 per share, which represents a 73% premium over the previous 10 day closing price. Total consideration for the purchase of SCRC is approximately $80.8 million. The shareholders of SCRC have guaranteed that SCRC’s audited 2014 net income will not be less than approximately $11.4 million, otherwise the purchase price shall be proportionally adjusted based on a percentage less than the $11.4 million threshold.

From the effective date of the transaction until the closing date, all of SCRC’s income and rights shall belong to SCHC. The closing of the transactions contemplated by the Agreement shall occur when the Agreement has been approved by the regulatory authorities in China, and updates have been made to the register of members which are then filed with the relevant industrial and commercial bureaus in China.

A copy of the Agreement is attached to this Current Report on Form 8-K as Exhibit 10.1 and is incorporated herein by reference.

Item 8.01.  Other Events.

On January 13, 2015, the Company issued a press release announcing the signing of the Agreement. A copy of the press release is attached hereto as Exhibit 99.1.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number	Description
10.1	Acquisition Agreement, dated January 12, 2015
99.1	Press Release, dated January 13, 2015

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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.

GULF RESOURCES, INC.
By:	/s/ Min Li
Name:	Min Li
Title:	Chief Financial Officer

Dated: January 14, 2015

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Exhibit Index

Exhibit Number	Description
10.1	Acquisition Agreement, dated January 12, 2015
99.1	Press Release, dated January 13, 2015

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EX-10.1

EQUITY INTERESTS TRANSFER AGREEMENT

BETWEEN

SHOUGUANG CITY HAOYUAN CHEMICAL COMPANY LIMITED,

GULF RESOURCES, INC.

SHOUGUANG CITY RONGYUAN CHEMICAL CO, LTD.

YihongYuan

Weihua Chen

Weijie Chen

AND

Cuiping Liu

DATED AS OF

January 12, 2015

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This EQUITY INTERESTS TRANSFER AGREEMENT (this "Agreement") is entered into as of January 12, 2015 (the "Effective Date") in Shouguang City, Shandong Province, by and between the following parties:

(1) SHOUGUANG CITY HAOYUAN CHEMICAL COMPANY LIMITED, a company validly existing under the laws of China ("SCHC" or the “Buyer”), a subsidiary of Gulf Resources, Inc..

(2) GULF RESOURCES, INC. (“GURE”), a public company listed on NASDAQ and the parent company of SCHC.

(3) SHOUGUANG CITY RONGYUAN CHEMICAL COMPANY LIMITED, a company validly existing under the laws of China ("SCRC" or the “Target Company”). SCRC was registered on June 2007. Its business address is as follows: the Second Livind District, Qinghe Oildfield factory, Yangkou Township, Shouguang City, Shandong Province, China. SCRC has registered capital, which is fully paid, in the amount of RMB250 million. SCRC is a leading company based in China that manufacturers products used for antibiotics for human and animals.

(4) YihongYuan, Weihua Chen, Weijie Chen and Cuiping Liu, four individual residents of China, who own the following percentages of the equity interests of SCRC (collectively, the “Sellers”):

Cuiping Liu owns 0.296% of the equity interests of SCRC;

Weijie Chen owns 0.104% of the equity interests of SCRC;

Weihua Chen owns 39.84% of the equity interests of SCRC; and

Yihong Yuan owns 59.76% of the equity interests of SCRC.

WHEREAS: the Sellers wish to sell, transfer and convey 100% equity interests of SCRC, and SCHC wishes to purchase and acquire the same from the Sellers based on the price, conditions and understandings set forth in this Agreement.

After the transfer of all of the Sellers’ shares, SCHC will own 100% equity interests of SCRC, and shall be entitled to all of its profit as well as possible operational risks and losses.

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The transfer of 100% equity interests of SCRC has been approved by all SCRC shareholders and board members.

NOW, THEREFORE, in consideration of the mutual promises contained herein, and for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged based on China and U.S. relevant laws, the parties agree as follows:

1. CERTAIN DEFINITIONS

"Closing" of the transactions contemplated by this Agreement shall occur when the transfer under this Agreement is approved by regulatory authorities, andupdates have been made to the register of members, and it has been registered and filed with relevant industrial and commercial bureaus in China (the "Closing Date").

"Person" shall mean any individual, entity or governmental body.

2. TRANSFER OF THE EQUITY INTERESTS AND PAYMENTS

2.1 The Sellers agree that, upon the Closing, they will complete the equity interests transfer registrations and relevant filings with China industrial and commercial bureaus after they receive approvals from various regulatory agencies and make such recordings on SCRC’s stock ledger.

2.2 The parties understand and acknowledge that the total purchase price for SCRC is RMB495,000,000 (the "Purchase Price"). Upon the terms and subject to all of the conditions contained herein, SCHC shall pay the Sellers, the following:

(a) 75% of RMB405,900,000 (the “Cash Purchase Price”) shall be paid in full within 3 business days of the Effective Date of this Agreement; and the remaining 25% of the Cash Purchase Price shall be paid in full within 3 business days of the Closing Date of this Agreement.

(b) 7,268,011shares of GURE’s common stock, par value $0.0005 per share (the “Restricted Stock”), at a price of $2.00 per share, representing an amount equal to RMB89,100,000 (approximately USD14,536,022) in the aggregate shall be issued by GURE to each Seller’s designee listed on the Exhibit 1 of this Agreement within 30 days of the Effective Date of this Agreement;

(c) The number of shares of Restricted Stock is based off of GURE common stock price at $2.00 per share. Based on the average closing price of GURE’s common stock on NASDAQ for the last 10 trading days prior to the Effective Date, which is $1.157, this represents a premium of 73%. The exchange rate applied shall be $1.00 = RMB6.1296, which is the published average exchange rate of the People’s Bank of China on January 9, 2015.

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The Sellers understand and agree that the GURE shall cause the restrictive legends set forth below, or substantially equivalent legends, to be placed upon any certificate(s) evidencing ownership of the Restricted Stock, together with any other legends that may be required by GURE or by applicable laws of the United States:

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION OTHERWISE COMPLIES WITH THE ACT.”

2.3 The parties understand and acknowledge that from the Effective Date until the Closing Date, all of SCRC’s income and rights shall belong to SCHC. SCRC shall not make any claim after the Closing Date. SCHC will not object to any board actions consistent with the terms of this Agreement which are made before the Closing Date.

2.4 Upon the Closing Date, Sellers shall  not have any rights, interests, or liabilities in SCRC.

2.5 All parties shall use their best efforts to complete the approval and registration procedures as soon as possible, including but not limited to, the modification registration at the industry and commercial bureau.

2.6 Any approvals or comments received by each party from the government, shall be promptly relayed to other parties by written notice.

3. REPRESENTATIONS AND WARRANTIES

3.1 The Sellers, jointly and severally, represent and warrant to SCHC the following:

(a) Authority.  Each Seller has the requisite power and authority to execute and deliver this Agreement and to perform his obligations hereunder, and to consummate the transactions hereby, and upon the execution and delivery of the instruments and documents specified herein. No further action will be required of the Sellers to vest legal title to and possession of SCRC in the name of SCHC, its successors and assigns, forever.

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(b) Title to Assets. The Sellers have good and marketable title the shares held by each of them in SCRC which have not been pledged or guaranteed to others. The Sellers will be responsible for any and all the possible economic and legal liabilities as a result of a violation of this Section 3.1(b).

(c) Sellers guarantee that SCRC’s 2014 audited net income will not be less than RMB70 million, otherwise the Purchase Price shall be proportionally adjusted.

(d) Sellers shall assist SCHC after the Closing Date to ensure that the entire process is executed successfully, and shall work with SCHC to ensure that SCRC’s original suppliers and customers are transitioned properly within one year from the Closing Date. Otherwise, the Sellers shall be responsible for all the loss incurred by SCHC.

(f) Regulation S. None of the Sellers nor their designees are a "U.S. Person" as defined in Rule 902 of Regulation S promulgated under the Securities Act (the “Securities Act”).  At the time this transaction was originated, each of the Sellers and their designees were outside the United States.  Each of the Sellers or their designees are receiving the Restricted Stock solely for the their own accounts and not for the account or benefit of any U.S. Person.

3.2 Each of SCHC and the Sellers represent and warrant respectively to the other as follows:

(a) Each of SCHC and the Sellers warrants that they have taken all necessary actions for the execution and performance of this Agreement, and they have obtained all necessary approvals and/or authorizations to execute this Agreement.

(b) Except as otherwise disclosed, the performance of the transaction contemplated hereunder is not subject to the consent, approval or order of any governmental authorities or any other third parties, nor is it subject to any conditions precedent as registration with, qualification verification by or document delivery to any governmental authorities or any other third parties.

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4. INDEMNIFICATION

4.1 If SCHC cannot obtain the equity interests of SCRC which the Sellers agree to sell under this Agreement due to the Sellers’ misrepresentation or concealing of the true situations of such equity interests, the Sellers shall return the full amount of the Purchase Price and pay to SCHC a compensation equal to the Purchase Price.

4.2 SCHC agrees to pay the Sellers overdue compensation for late payment at a rate of 0.05% per day of the overdue amount of the payment..

4.3 Taxes and Levy from Government Agency

All taxes and levy related to the transfer of SCRC equity interests shall be paid by the relevant party pursuant to relevant laws.

5. MISCELLANEOUS PROVISIONS.

5.1 Entire Agreement. This Agreement, along with the documents and agreements to be executed in connection herewith, constitutes the full understanding of the parties, a complete allocation of risks between them and a complete and exclusive statement of the terms and conditions of their agreement relating to the subject matter hereof and supersedes any and all prior agreements, whether written or oral, that may exist between the parties with respect thereto.

5.2 Modification. Any modification of this Agreement shall be made in written, and shall be effective upon the execution of all parties’ authorized representatives and the approval of the relevant authority.

5.3 Severability. In case any provision of the Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected thereby.

5.4 Counterparts. This Agreement may be executed in eight (8) counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together will constitute an integral party of this Agreement. Each of the seven signing parties will hold one original copy of this Agreement and the eighth original copy will be used for government authority approval purpose.

5.11 Governing Law. This Agreement shall be governed by and construed exclusively in accordance with the laws of China.

5.12 Dispute Resolution. The Parties agree to negotiate in good faith to resolve any dispute between them regarding this Agreement. If the negotiations do not resolve the dispute to the reasonable satisfaction of all Parties within 2 months after the commencement of the negotiation, such dispute shall be referred to and finally settled by arbitration at Shandong Arbitration Committee in accordance with their rules. The arbitration ruling shall be final and binding to all parties.

[Signature page follows]

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IN WITNESS HEREOF the Parties hereto have caused this Agreement to be executed by their duly authorized representatives as of the date first hereinabove mentioned.

Buyer: SHOUGUANG CITY HAOYUAN CHEMICAL COMPANY LIMITED

  /s/ Naihui Miao

Name: Naihui Miao

Title:  Director & Vice Manager

Sellers:

/s/ Cuiping Liu

Name:  Cuiping Liu

/s/ WeiJie Chen

Name: Weijie Chen

/s/ Weihua Chen

Name: Weihua Chen

/s/ Yihong Yuan

Name: Yihong Yuan

Target Company: SHOUGUANG CITY RONGYUAN CHEMICAL CO, LTD.

/s/ Cuiping Liu

Name: Cuiping Liu

Title: Authorized Representative

AGREED as of the date first above written:

GULF RESOURCES, INC.

/s/ Xiaobin Liu

Name: Xiao Bin Liu

Title:  CEO

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Exhibit 1

Designee of the Seller	Number of Shares to Be Issued
Cuiping Liu	21,513(0.296%)
Weijie Chen	7,559(0.104%)
Weihua Chen	2,895,576(39.84%)
Yihong Yuan	4,343,363(59.76%)
	Total: 7,268,011 (100%)

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EX-99.1

Gulf Resources Accelerates Its Transformation, Enters Into an Equity

Interests Transfer Agreement With Shouguang City Rongyuan Chemical Co., Ltd.

SHOUGUANG, China, Jan. 13, 2015 (GLOBE NEWSWIRE) -- Gulf Resources, Inc. (Nasdaq:GURE) has accelerated its transformation from a manufacturer of raw materials into an integrated producer of value added downstream products with its acquisition of Shouguang City Rongyuan Chemical Co., Ltd. (SCRC), a leading manufacturer of materials for human and animal antibiotics in China and other parts of Asia.

Xiaobin Liu, the Chief Executive Officer of Gulf Resources stated, "As our shareholders know, we have generated substantial cash flow and at the end of the third quarter, GURE had cash of $132 million and shareholder's equity of $307.1 million. We informed our shareholders that we intended to use our excess cash to build a faster growing and higher margin business that was not as subject to the economic cycles that has impacted our bromine business."

"In 2014, despite the weakness in the overall Chinese economy, our chemical business, which has higher margins and return on investment than our other business segments, has shown improved profits," Xiaobin Liu continued. "With the acquisition of SCRC we are moving into a downstream business that we believe will help GURE increase its profit margins, improve its return on investment, produce more consistent and reliable earnings and lessen our dependence on the economically sensitive bromine industry."

SCRC is a leading manufacturer of materials for human and animal antibiotics in China. We believe there will be an increased demand for these products due to the wide reform of the medical system in China. We also believe there will be an increased demand in other Asian countries. SCRC has been a solid customer for our company in the past. In 2014, SCRC purchased approximately $5.4 million of bromine from GURE.

In this transaction, our wholly owned subsidiary, Shouguang City Haoyuan Chemical Company Limited (SCHC) signed an equity interest transfer agreement with the four individual shareholders of SCRC. Consideration for this transaction consists of $66.2 million in cash and the issuance of shares of approximately 7.27 million shares of common stock at a price of $2.00 per share which is a 73% premium over the previous 10 day closing price, bringing the total consideration for the purchase of SCRC to $80.8 million. Following the transaction, we will have approximately 46.17 million shares outstanding.

The shareholders of SCRC have guaranteed that SCRC's audited 2014 net income will not be less than RMB70 million (approximately $11.4 million), otherwise the purchase price shall be proportionally adjusted based on a percentage less than the RMB70 million threshold. From the effective date of the transaction until the closing date, all of SCRC's income and rights shall belong to SCHC. The closing of this transaction shall occur when the equity interests transfer under the agreement is approved by regulatory authorities, and updates have been made to the register of members which will then be filed with relevant industrial and commercial bureaus in China.

GURE believes SCRC will generate net income for 2014 in the range of $11-12 million. In 2015, GURE believes that SCRC will contribute additional revenue of approximately $60 million, with a contribution to net income of approximately $15 million.

Overall, we expect that the Chinese economy and bromine demand will remain relatively soft. However, with the acquisition and the expansion of our chemical business, we expect 2015 total revenue will increase to $190 million, and net income will increase to the range of $33 million to $34 million (approximately $0.74 per share) based on current bromine price levels.

Xiaobin Liu states "We will continue to pursue a long-term growth strategy by expanding our business segments, exploring more brine water resources, obtaining bromine assets through acquisition, developing new projects, and continually looking for and making attractive horizontal and vertical acquisitions, while evaluating our cash flow from operating activities, which will help the company achieve a sustainable long-term competitive advantage."

"With a solid base in bromine, crude salt, chemicals, and now materials for human and animal antibiotic products," Xiaobin Liu stated, "We believe we can generate higher income and return on investment that will greatly enhance shareholder value."

The closing of the transaction is subject to certain closing conditions. Further details on the terms of this transaction can be found in the company's 8-K, which is expected to be filed with the U.S. Securities and Exchange Commission on January 14, 2015.

About Gulf Resources, Inc.

Gulf Resources, Inc. operates through two wholly-owned subsidiaries, Shouguang City Haoyuan Chemical Company Limited ("SCHC") and Shouguang Yuxin Chemical Industry Co., Limited ("SYCI"). The company believes that it is one of the largest producers of bromine in China. Elemental Bromine is used to manufacture a wide variety of compounds utilized in industry and agriculture. Through SYCI, the company manufactures chemical products utilized in a variety of applications, including oil and gas field explorations and papermaking chemical agents. For more information, visit www.gulfresourcesinc.com.

Forward-Looking Statements

Certain statements in this news release contain forward-looking information about Gulf Resources and its subsidiaries business and products within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. The actual results may differ materially depending on a number of risk factors including, but not limited to, the general economic and business conditions in the PRC, future product development and production capabilities, shipments to end customers, market acceptance of new and existing products, additional competition from existing and new competitors for bromine and other oilfield and power production chemicals, changes in technology, the ability to make future bromine asset purchases, and various other factors beyond its control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risks factors detailed in the company's reports filed with the Securities and Exchange Commission. Gulf Resources undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.

Gulf Resources, Inc.

Web: http://www.gulfresourcesinc.com

CEO Assistant & Director of Investor Relations

Helen Xu

IR Manager

Max Ma