CLEANTECH SOLUTIONS INTERNATIONAL, INC. (NASDAQ:CLNT) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement
Item 2.01 Completion of Acquisition or Disposition of
Assets
to an agreement dated December 30, 2016, the Company, through its
wholly-owned subsidiary Fulland Limited, sold the stock of Wuxi
Fulland Wind Energy Equipment Co., Ltd. (Fulland Wind), to Wang
Jiahong for a sales price of RMB48 million (approximately
$6.9million). The Companys wind power equipment business was
conducted through Fulland Wind. The purchase price is payable in
three installments. The first installment of RMB 14,400,000
(approximately $2.1 million), which was payable three days after
the contract is in force, has been paid. A second installment of
RMB 14,400,000 (approximately $2.1 million) is due within six
months after the transfer registration formalities are completed
and, if the equity transfer registration formalities are
completed within one year without any third party claims on the
equity transfer, a final payment of RMB 19,200,000 (approximately
$2.7 million) is due 25 working days after the expiration of such
period.
Contemporaneously with the sale of the Fulland Wind stock, Wuxi
Huayang Heavy Industry Co., Ltd. (Heavy Industry), entered into a
lease with Wang Jiahong for a factory building owned by Heavy
Industry at an annual rental of RMB 680,566 (approximately
$98,000). The lease has a ten-year term, commencing January 1,
2017. The first years rent is payable in two installments, the
first installment, equal to 30% of the annual rental, being due
on signing the lease, has been paid. The balance is due before
the end of 2017. Heavy Industries is a variable interest entity
owned by the Companys chief executive officer and his wife and
whose financial statements are included in the Companys
consolidated financial statements.
Fulland Wind owns assets related to manufacturing of rolled rings
and related products. The identifiable long-lived tangible assets
allocated to the forged rolled rings and related components were
valued at $0 at September 30, 2016 and $14,212,045 at December
31, 2015. The identifiable long-lived assets that had been
allocated to the forged rolled rings and related equipment
segment at December 31, 2015 had been allocated at September 30,
2016 to the dyeing and finishing equipment segment to the extent
that the assets could be used by that segment and the balance to
equipment held for sale.
The sale of Fulland Wind followed declining sales of forged
rolled rings and related components, which were approximately
$32,000 for the three months ended September 30, 2016 and
$437,000 for the nine months ended September 30, 2016. The net
loss allocated to this segment was approximately $113,000 for the
three months ended September 30, 2016 and approximately $1.5
million for the nine months ended September 30, 2016. As a result
of the sale of Fulland Wind, the Company will reflect the
operations of the rolled rings and related products segment as a
discontinued operation in its financial statements.
Item 9.01 Financial Statements and Exhibits.
| (d) | Exhibits. |
| 99.1 |
English translation of agreement dated December 30, 2016 between the Company and Wang Jiahong. |
|
| 99.2 |
English translation of lease dated December 30, 2016 between Wuxi Huayang Heavy Industry Co., Ltd. and Wang Jiahong |
About CLEANTECH SOLUTIONS INTERNATIONAL, INC. (NASDAQ:CLNT)
Cleantech Solutions International, Inc., through its subsidiaries, manufactures and sells textile dyeing and finishing machines and sells forged products and fabricated products to a range of clean technology customers, including high precision forged rolled rings and related components for the wind power industry and other industries. The Company operates through three segments: dyeing and finishing equipment segment, forged rolled rings and related components segment, and petroleum and chemical equipment segment. Through its dyeing and finishing equipment segment, the Company designs, manufactures and distributes a line of high and low temperature dyeing and finishing machinery to the textile industry. Through its petroleum and chemical equipment segment, the Company produces and sells coal chemical equipment, formaldehyde plant and downstream products, a range of heat exchangers, separators, tanks, towers, reaction kettles and other products to petroleum and chemical industries. CLEANTECH SOLUTIONS INTERNATIONAL, INC. (NASDAQ:CLNT) Recent Trading Information
CLEANTECH SOLUTIONS INTERNATIONAL, INC. (NASDAQ:CLNT) closed its last trading session up +0.083 at 0.793 with 569,826 shares trading hands.
