0001079973-17-000125.txt : 20170217 0001079973-17-000125.hdr.sgml : 20170217 20170217074916 ACCESSION NUMBER: 0001079973-17-000125 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20170217 DATE AS OF CHANGE: 20170217 GROUP MEMBERS: XD ENGINEERING PLASTICS CO LTD SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: China XD Plastics Co Ltd CENTRAL INDEX KEY: 0001353970 STANDARD INDUSTRIAL CLASSIFICATION: PLASTICS FOAM PRODUCTS [3086] IRS NUMBER: 043836208 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-84400 FILM NUMBER: 17619749 BUSINESS ADDRESS: STREET 1: 500 5TH AVENUE, STE 960 CITY: NEW YORK STATE: NY ZIP: 10110 BUSINESS PHONE: 212-747-1118 MAIL ADDRESS: STREET 1: 500 5TH AVENUE, STE 960 CITY: NEW YORK STATE: NY ZIP: 10110 FORMER COMPANY: FORMER CONFORMED NAME: NB Telecom, Inc. DATE OF NAME CHANGE: 20060221 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Han Jie CENTRAL INDEX KEY: 0001453248 FILING VALUES: FORM TYPE: SC 13D/A MAIL ADDRESS: STREET 1: NO 9 QINLING RD, YINGBIN RD, STREET 2: CENTRALIZED IND PARK, HARBIN DEVELP CTR CITY: HEILONGJIANG STATE: F4 ZIP: 150078 SC 13D/A 1 cxdc_13da3.htm SCHEDULE 13D/A
 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13D/A
(RULE 13d-101)

(Amendment No. 3)*

Information to be Included in Statements Filed Pursuant to Rule 13d-1(a) and Amendments Thereto Filed Pursuant to Rule 13d-2(a)

CHINA XD PLASTICS COMPANY LIMITED
(Name of Issuer)
 
Common Stock, $0.0001 par value
(Title of Class of Securities)

16948F107
(CUSIP Number)

XD. Engineering Plastics Company Limited
Jie HAN
No. 9 Dalian North Road, Haping Road Centralized Industrial Park,
 Harbin Development Zone,
Heilongjiang Province, P. R. China 150060
(86) 451-8434-6600
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

February 16, 2017
(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. 

Note:  Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

*
The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
 
 


CUSIP No.
16948F107
 
 
1.
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
XD. Engineering Plastics Company Limited
2.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
(a)  
(b)  
3.
SEC USE ONLY
 
4.
SOURCE OF FUNDS (SEE INSTRUCTIONS):
OO
5.
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): 
6.
CITIZENSHIP OR PLACE OF ORGANIZATION
British Virgin Islands
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH
7.
SOLE VOTING POWER
0
8.
SHARED VOTING POWER
25,382,598
9.
SOLE DISPOSITIVE POWER
0
10.
SHARED DISPOSITIVE POWER
25,382,598
11.
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
25,382,598*
12.
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):
**
13.
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
49.2% of Common Stock and 100% of Series B Preferred Stock***
14.
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
CO
 
*
25,382,598 shares consist of (a) 24,382,598 shares of common stock, par value $0.0001 per share ("Common Stock") and (b) 1,000,000 shares of Series B Preferred Stock of par value $0.0001 each ("Series B Preferred Stock").
 
**
Excludes 16,000,000 shares of Series D Preferred Stock beneficially owned by MSPEA Modified Plastics Holding Limited.
 
***
Based on 49,556,541 outstanding shares of Common Stock and 1,000,000 shares of outstanding Series B Preferred Stock, as reported in China XD Plastics Company Limited's recently filed Form 10-Q, as filed with the Securities and Exchange Commission on November 9, 2016.
 
 
 


CUSIP No.
16948F107
 
 
 
1.
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
JIE HAN
2.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
(a)  
(b)  
3.
SEC USE ONLY
 
4.
SOURCE OF FUNDS (SEE INSTRUCTIONS):
OO
5.
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): 
6.
CITIZENSHIP OR PLACE OF ORGANIZATION
People's Republic of China
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH
7.
SOLE VOTING POWER
8,127,533
8.
SHARED VOTING POWER
25,382,598
9.
SOLE DISPOSITIVE POWER
8,127,533
10.
SHARED DISPOSITIVE POWER
25,382,598
11.
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
33,510,131*
12.
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):
**
13.
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
65.6% of Common Stock and 100% of Series B Preferred Stock ***
14.
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
IN
 
*
33,510,131 shares consist of (a) 8,127,533 shares of Common Stock directly owned by Jie HAN and (b) 24,382,598 shares of Common Stock and 1,000,000 shares of Series B Preferred Stock beneficially owned by Jie HAN through his 100% ownership of XD. Engineering Plastics Company Limited.
 
**
Excludes 16,000,000 shares of Series D Preferred Stock beneficially owned by MSPEA Modified Plastics Holding Limited.
 
***
Based on 49,556,541 outstanding shares of Common Stock and 1,000,000 shares of outstanding Series B Preferred Stock, as reported in China XD Plastics Company Limited's recently filed Form 10-Q, as filed with the Securities and Exchange Commission on November 9, 2016.
 
 

INTRODUCTORY NOTES

This amendment No. 3 (this "Amendment No. 3") is filed jointly by XD. Engineering Plastics Company Limited  ("XD Engineering") and Mr. JIE HAN ("Mr. Han", together with XD Engineering, the "Reporting Persons", and each a "Reporting Person"), with respect to China XD Plastics Company Limited (the "Company" or "Issuer").

This Amendment No. 3 amends and supplements the Schedule 13D filed on January 16, 2009, as previously amended and supplemented by Amendment No. 1 filed on July 5, 2011 and Amendment No. 2 filed on September 29, 2011 by the Reporting Persons. Capitalized terms used but not defined in this Amendment No. 3 shall have the meanings assigned to such terms in the Schedule 13D.

ITEM 3.
SOURCES AND AMOUNT OF FUNDS OR OTHER CONSIDERATION

Item 3 of the Schedule 13D is hereby amended and supplemented by adding the following:

The Consortium (as defined in Item 4 below) anticipates that, at the price per share of the Company's Common Stock set forth in the Proposal (as described in Item 4 below), approximately US$91 million will be required for the Proposed Transaction.

It is anticipated that the funding for the Proposed Transaction will be provided by a combination of debt and equity capital. Equity financing is expected to be provided by the Consortium in the form of rollover equity in the Company and cash contributions from third party sponsors. Debt financing is expected to be provided by loans from third party financial institutions.

ITEM 4.
PURPOSE OF TRANSACTION

Item 4 of the Schedule 13D is hereby amended and supplemented by adding the following:

On February 16, 2017, Mr. Han, XD Engineering and MSPEA Modified Plastics Holding Limited, an affiliate of Morgan Stanley Private Equity Asia III, Inc. ("MSPEA") formed a consortium (the "Consortium") by entering into a consortium agreement (the "Consortium Agreement"), a copy of which is attached hereto as Exhibit 7.01. Under the Consortium Agreement, the Consortium agreed, among other things, (i) to jointly deliver a preliminary, non-binding proposal (the "Proposal") to the Company's board of directors (the"Board") for the acquisition of all of the outstanding shares of Common Stock of the Company not already owned by the Consortium at US$5.21 per share in cash (the "Proposed Transaction"), (ii) to deal exclusively with each other with respect to the Proposed Transaction for a maximum of six months after the date thereof, (iii) to conduct a joint assessment of the Company as promptly as reasonably, and (iv) to use their reasonable best efforts to work together to structure, negotiate and do all things necessary or desirable, subject to the Issuer's approval, to enter into the definitive agreements in respect of the Proposed Transaction.

On February 16, 2017, the Consortium submitted the Proposal to the Board, a copy of which is attached hereto as Exhibit 7.02. In the Proposal, the Consortium proposed to acquire all of the outstanding shares of Common Stock of the Company not already owned by the Consortium at US$5.21 per share in cash. The Consortium also stated in the Proposal that it is interested only in the Proposed Transaction, and that it does not intend to sell its shares in the Company to any other party. The Consortium intended to finance the transactions contemplated under the Proposal through a combination of debt and equity capital.  The Consortium expects that the Board will appoint a special committee of independent directors to consider the Proposal and make a recommendation to the Board.  The Consortium will not move forward with the Proposed Transaction unless it is approved by such a special committee, and the Proposed Transaction will be subject to a non-waivable condition requiring approval by majority shareholder vote of shareholders other than the Consortium members.
 
The Consortium indicated in the Proposal that it is prepared to negotiate and finalize the terms of the Proposed Transaction in definitive transaction documents, which will provide for covenants and conditions typical and appropriate for transactions of this type.  The Proposal also provided that no binding obligation on the part of the Company or the Consortium shall arise with respect to the Proposed Transaction unless and until definitive agreements have been executed.
 
 


 
If the Proposed Transaction is completed, the Company's Common Stock would become eligible for termination of registration pursuant to Section 12(g)(4) of the Securities Act and would be delisted from the NASDAQ Global Market.

References to the Consortium Agreement and the Proposal in this Schedule 13D are qualified in their entirety by reference to the Consortium Agreement and the Proposal, copies of which are attached hereto as Exhibit 7.01 and Exhibit 7.02 and incorporated herein by reference in its entirety.

Except as indicated above, the Reporting Persons have no plans or proposals which relate to or would result in any of the actions specified in Item 4 of Schedule 13D.

ITEM 6.
CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER

Item 6 is hereby amended to supplement the following:

The descriptions of the principal terms of the Consortium Agreement and the Proposal under Item 4 are incorporated herein by reference in their entirety.

ITEM 7.
MATERIAL TO BE FILED AS EXHIBITS

Exhibit 7.01
Consortium Agreement by and among Mr. Han, XD Engineering and MSPEA, dated as of February 16, 2017.
 
Exhibit 7.02
Proposal letter from the Consortium to the Board, dated as of February 16, 2017, incorporated herein by reference to Exhibit 99.1 to the Report on Form 8-K furnished by the Company to the SEC on February 17, 2017.
 
 
 
 
 



SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
 
 
Dated:  
February 17, 2017
 
 
 
 
 
 
 
XD. Engineering Plastics Company Limited
 
 
 
 
By:
/s/ Jie HAN
 
Name:    
Jie HAN
 
Title:
Authorized Signatory
 
 
 
 
 
 
 
Jie HAN
     
  /s/ Jie HAN
 
Jie HAN
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
EX-7.01 2 ex7x1.htm EXHIBIT 7.01

Exhibit 7.01
 
 

CONSORTIUM AGREEMENT
THIS CONSORTIUM AGREEMENT (this "Agreement") is dated as of February 16, 2017 and is entered into by and among Jie Han ("Founder"), XD. Engineering Plastics Company Limited, a company incorporated in the British Virgin Islands and wholly owned by Founder ("XD Engineering") and MSPEA Modified Plastics Holding Limited, an affiliate of Morgan Stanley Private Equity Asia III, Inc. ("MSPEA").  Each of Founder, XD Engineering and MSPEA is referred to herein as a "Party", and collectively, the "Parties".
RECITALS
WHEREAS, the Parties are interested in jointly pursuing a possible acquisition (the "Transaction") of all of the outstanding shares of common stock ("Common Stock") of China XD Plastics Company Limited (the "Company") through a special purpose vehicle ("Parent") to be formed by the Parties directly or indirectly in the Cayman Islands or another offshore jurisdiction;
WHEREAS, (a) in connection with the Transaction, the Parties will cause Parent to form a direct, wholly-owned subsidiary ("Merger Sub") under the laws of the State of Nevada, and (b) at the closing of the Transaction, the Parties intend that Merger Sub will be merged with and into the Company, with the Company being the surviving company and becoming a direct, wholly-owned subsidiary of Parent which will be beneficially owned by the Parties;
WHEREAS, on the date hereof, the Parties will submit a non-binding proposal, a copy of which is attached hereto as Schedule A (the "Proposal Letter"), to the board of directors of the Company (the "Company Board") in connection with the Transaction; and
WHEREAS, in accordance with the terms of this Agreement, the Parties will cooperate and participate in: (a) the evaluation of the Company, including conducting due diligence of the Company and its business; (b) discussions regarding the Proposal Letter with the Company; and (c) the negotiation of the terms of definitive documentation in connection with the Transaction (in which negotiations the Parties expect that the Company will be represented by a special committee of independent and disinterested directors of the Company Board), including an agreement and plan of merger among Parent, Merger Sub and the Company in form and substance to be agreed by the Parties (the "Merger Agreement"), which shall be subject to the approval of the shareholders of the Company and any financing documents in connection with the Transaction.
NOW, THEREFORE, the Parties agree as follows:
1. Certain Definitions.
"Competing Transaction" shall mean (i) any direct or indirect acquisition by any person or entity of any securities representing a controlling equity interest in the Company or all or substantially all of its assets or (ii) a recapitalization, restructuring, merger, consolidation or other business combination involving a change in control of the Company or any of its material subsidiaries, in either case other than the Transaction involving all of the Parties.
 
 

 
"Exclusivity Period" shall mean the period beginning on the date hereof and ending on the date of termination of this Agreement pursuant to Section 14.
"Representatives" shall mean, with respect to a person, such person's affiliates and its and their employees, directors, officers, partners, members, agents, advisors (including, but not limited to, legal counsel, accountants, consultants and financial advisors), and any representative of the foregoing.  The Representatives shall include the Legal Advisors as defined in Section 3(c).
"Shares" shall mean all capital stock in the Company.
2. Commitment to the Consortium.
(a) Within the Exclusivity Period, and except for actions taken by Founder in his capacity as the Chief Executive Officer, the Chairman of the Company Board or a Director of the Company, each Party will deal exclusively with each other with respect to the Transaction and will not, and will cause his or its Representatives acting in such capacity not to, without the written consent of the other Parties: (i) directly or indirectly initiate, solicit, encourage or otherwise engage in discussions or negotiations with the Company or any third party with respect to a Competing Transaction; (ii) provide any information to any third party with a view to the third party pursuing a Competing Transaction; or (iii) enter into any written or oral agreement, arrangement or understanding (whether legally binding or not) regarding, or do anything which is directly inconsistent with, or omit to do anything, which omission is directly inconsistent with, the Transaction involving all of the Parties as contemplated under this Agreement.
(b) Within the Exclusivity Period, each Party will not, and will not permit his or its affiliates or Representatives to, directly or indirectly: (i) sell, offer to sell, give, pledge, encumber, assign, grant any option for the sale of or otherwise transfer or dispose of, or enter into any agreement, arrangement or understanding to sell, any Shares beneficially owned by such Party ("Shareholder Shares") (in each instance a "Transfer"), or enter into any contract, option or other arrangement or understanding with respect to a Transfer or limitation on voting rights of the Shareholder Shares or any right, title or interest thereto or therein; (ii) deposit any Shareholder Shares into a voting trust or grant any proxy or enter into a voting agreement, power of attorney or voting trust with respect to any Shareholder Shares; (iii) take any action that would have the effect of preventing, disabling or delaying any Party or his or its affiliate from performing his or its obligations under this Agreement; or (iv) agree (whether or not in writing) to take any of the actions referred to in the foregoing clauses (i), (ii) or (iii) of this Section 2(b).  Notwithstanding the foregoing, Founder may make a Transfer to his spouse, siblings, parents, lineal descendants or antecedents or the estates of or trusts for the benefit of Founder or his spouse, siblings, parents or lineal descendants or antecedents, and MSPEA may make a Transfer to its affiliates; provided, however, that in all cases, any such Transfer shall not relieve the transferor of his or its obligations hereunder, and the transferee or other recipient executes a counterpart copy of this Agreement and becomes bound thereby as is the transferor.
(c) Subject to Section 2(a), and except for actions taken by Founder in his capacity as the Chief Executive Officer, the Chairman of the Company Board or a Director of the Company, each Party will, and will cause his or its Representatives to, immediately cease and terminate any existing activities, discussions and negotiations in connection with any Competing Transaction.
 
2

 
(d) Upon the termination of this Agreement in accordance with clause (iii) of Section 14, the Parties shall negotiate in good faith and in a commercially reasonable manner an extension of the term of this Agreement.
3. Process.
(a) Upon signing of this Agreement, the Parties shall immediately deliver the Proposal Letter to the Company Board.
(b) Within the term of this Agreement and as permitted by the Company Board, the Parties shall as promptly as reasonably practicable conduct a joint assessment of the Company, and shall in good faith and with mutual cooperation use their reasonable best efforts to work together to structure, negotiate and do all things necessary or desirable, subject to the Company's approval, to enter into the Merger Agreement and other ancillary documents in connection with the Transaction (the "Definitive Agreements").  This Agreement constitutes only a preliminary arrangement relating to a Transaction and does not constitute any binding commitment with respect to a Transaction.  Such commitment will result only from the execution of the Definitive Agreements (upon such execution, all actions by Parent will be subject to the prior approval of all of the Parties), and then will be on the terms provided in the Definitive Agreements.  The Parties and their respective affiliates and Representatives shall coordinate with each other in performing due diligence, securing debt (as applicable) and equity financing, and structuring and negotiating the Transaction, including establishing appropriate vehicles for the purpose of the Transaction; provided, however, that in no event will any Party be obligated without his or its consent to enter into or otherwise be a Party to any Definitive Agreements.
(c) Skadden , Arps, Slate, Meagher & Flom LLP ("Skadden" ) is acting as legal advisor to Founder and XD Engineering and Paul, Weiss, Rifkind, Wharton & Garrison LLP ("Paul Weiss") is acting as legal advisor to MSPEA.  Skadden and Paul Weiss are collectively referred to as the "Legal Advisors".
(d) All other advisors to the buyer consortium (the "Consortium"), including any financial advisor to the Consortium (collectively with the Legal Advisors, the "Consortium Advisors") shall be jointly selected by the Parties.
4. Confidentiality.  Each Party shall, and shall direct his or its Representatives to, keep this Agreement and the Transaction confidential and shall not make any public statement or announcement concerning or disclose to any third party the fact that discussions or negotiations are taking place concerning the Transaction or any of the terms, conditions or other facts with respect thereto, including the status thereof, other than as mutually agreed in writing by the Parties or as required by applicable laws, rules or regulations.  Each Party shall coordinate in good faith all press releases and regulatory filings (including any Schedule 13D filings to disclose its participation in the Transaction) and other public relation matters relating to the Transaction.  Notwithstanding the foregoing, MSPEA may disclose this Agreement or the status of negotiations between the Parties with respect to the Transaction to any investors in North Haven Private Equity Asia III, L.P..
5. Certain Fees and Expenses.
(a) If the Transaction is not consummated, and the failure for the Transaction to be consummated is not due to the willful misconduct of any Party, the Parties agree that: (i) each Party shall bear fees and out-of-pocket expenses payable by him or it to his or its respective Legal Advisor in connection with the Transaction incurred prior to the termination of this Agreement with respect to such Party; and (ii) each Party shall bear a percentage, which percentage shall be agreed between the Parties prior to the retention of any Consortium Advisors ("Pre-Agreed Percentage"), of all fees and out-of-pocket expenses payable in connection with the Transaction to the Consortium Advisors (other than the Legal Advisors) or any lender or other financing sources; provided, however, that each Party shall bear fees and out-of-pocket expenses payable by him or it to any advisor retained by him or it to conduct due diligence, or incurred by him or it in the defense, pursuit or settlement of any disputes or litigation relating to the Transaction.
 
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(b) Upon consummation of the Transaction, Parent shall reimburse each Party for all fees and out-of-pocket expenses incurred by him or it (including fees and expenses of his or its Legal Advisor retained pursuant to Section 3(c) hereof) in connection with the Transaction; provided, however, that such reimbursable expenses of each Party other than Founder incurred prior to the execution of this Agreement shall be limited to those approved in writing by Founder prior to the date hereof.
(c) Each Party shall share, ratably based on its Pre-Agreed Percentage, any termination, topping, break-up or other fees or amounts (including amounts paid in settlement of any disputes or litigation relating to the Transaction) payable by Parent (or one or more of its affiliates or designees), net of the expenses required to be borne by such Party pursuant to Section 5(a).
(d) This Section 5 shall survive the termination of this Agreement.
6. Remedies.  It is understood and agreed that money damages may not be a sufficient remedy for a breach of this Agreement by any Party and that each Party shall be entitled to seek equitable relief, including injunction and specific performance, as a remedy of any such breach by the other Parties.  Such remedies shall not be deemed to be the exclusive remedies for a breach by a Party but shall be in addition to all other remedies available at law or in equity to the other Parties.  Each Party further agrees not to raise as a defense or objection to the request or granting of such relief that any breach of this Agreement is or would be compensable by an award of money damages, and each Party agrees to waive any requirements for the securing or posting of any bond in connection with such remedy.
7. Governing Law; Arbitration.  This letter agreement and all matters arising out of or relating to this letter agreement shall be governed by and construed in accordance with the laws of Hong Kong, without reference to conflict of laws principles.  Any dispute, controversy or claim arising out of or relating to this letter agreement, including the validity, invalidity, breach or termination thereof, shall be settled by arbitration in Hong Kong under the Hong Kong International Arbitration Centre Administered Arbitration Rules (the "Rules") in force when the notice of arbitration is submitted in accordance with these Rules.  There shall be three arbitrators, one to be appointed by the claimant, one to be appointed by the respondent and the third to be appointed by the secretary general of the Hong Kong International Arbitration Centre.  The arbitration proceedings shall be conducted in English.
8. No Modification.  No provision in this Agreement can be waived, modified or amended except by written consent of the Parties, which consent shall specifically refer to the provision to be waived, modified or amended and shall explicitly make such waiver, modification or amendment.
 
4

 
9. No Waiver or Rights.  It is understood and agreed that no failure or delay by any Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.
10. Counterparts; Entire Agreement.  This Agreement may be signed and delivered by facsimile or portable document format via electronic mail and in one or more counterparts, each of which shall be deemed an original but all of which shall be deemed to constitute a single instrument.  This Agreement sets forth the entire agreement and understanding among the Parties and supersedes all prior agreements, discussions or documents relating thereto.  No Party shall be entitled to punitive, exemplary, special, unforeseen, incidental, indirect or other consequential damages.
11. Severability.  If any provision of this Agreement is found to violate any statute, regulation, rule, order or decree of any governmental authority, court, agency or exchange, such invalidity shall not be deemed to affect any other provision hereof or the validity of the remainder of this Agreement, and such invalid provision shall be deemed deleted herefrom to the minimum extent necessary to cure such violation.
12. Successors.  This Agreement shall inure to the benefit of, and be binding upon, the Parties and their respective successors and assigns.  No Party may assign or transfer, directly or indirectly, its rights or obligations hereunder without the prior written consent of the other Parties except as provided herein.  No assignment will relieve the assignor of its obligations hereunder.
13. No Third Party Beneficiaries.  Unless otherwise specifically provided herein, each Party agrees and acknowledges that nothing herein expressed or implied is intended to confer upon or give any rights or remedies to persons who are not a party to this Agreement under or by reason of this Agreement.
14. Term.  This Agreement shall terminate upon the earlier of: (i) the mutual written agreement by the Parties; (ii) the execution and delivery of the Definitive Agreements; and (iii) the date six months after the date hereof.

[Signatures to Follow on the Next Page]
 
 
5


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

JIE HAN
 

/s/ Jie HAN                                        


 
XD. Engineering Plastics Company Limited
 

By:  /s/ Jie HAN                                        
Name:  Jie HAN
Title:  Authorized Signatory 
 


MSPEA Modified Plastics Holding Limited
 

By:  /s/ Ivan John Sutlic                     
Name:  Ivan John Sutlic
Title:   Authorized Signatory















 
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