TMK Battery Systems Signs Purchase Agreement with Lithium Battery Producer Dongfang Hualian

China TMK Battery Systems Inc. ("TMK" or "the Company") (formerly, Deerfield Resources, Ltd.), a Chinese manufacturer and distributor of customized rechargeable battery solutions to global consumer product companies, today announced it completed a share purchase agreement with Loyal Top Capital Investment Limited ("Loyal Top") for the purchase of Shenzhen Dongfang Hualian Technology Co., Ltd. ("Dongfang Hualian"). Separately, the Company completed a $16 million preferred stock equity financing agreement ("financing agreement") with China Development Industrial Bank and ZTE Energy Limited.

On August 13, 2011, TMK completed a purchase agreement with Loyal Top, the legal entity that owns and controls 100% of Dongfang Hualian to consummate TMK’s acquisition. Under the terms of the purchase agreement, the Company will acquire 100% equity interest in Dongfang Hualian in exchange for a cash payment of approximately $11 million and 8.1 million shares of the Company’s common stock. Dongfang Hualian is a lithium battery producer which designs, manufactures and sells lithium batteries.

The Company previously made an advance cash payment of approximately $10.5 million toward the purchase price. The formal closing of the acquisition, expected on or before September 15, 2011, requires approval by all relevant regulatory authorities and registration of Loyal Top’s ownership of Dongfang Hualian with the Shenzhen Administration for Industry and Commerce. The purchase agreement contains a make-good provision that Dongfang Hualian achieves a net profit of approximately $9.3 million for the calendar year ending December 31, 2011. The audited financial statements reported that Dongfang Hualian generated approximately $41 million in revenue and approximately $5.5 million in net income during 2010.

On May 28, 2011 and June 20, 2011, the Company signed separate purchase agreements with China Development Industrial Bank and ZTE Energy Co., Ltd., respectively, for the two investors to purchase an aggregate of 8,000,000 shares of the Company’s preferred stock convertible at $2 per share.

"These transformative transactions position the Company for the next phase of growth," remarked Mr. Henian Wu, Chairman and President of the Company. "Dongfang Hualian, with a state-of-the-art production facility built in 2008 and 20 patents related to lithium ion battery technologies, provides us with an entry into a multi-billion dollar, rapidly growing global market opportunity.

Based in Shenzhen, PRC and founded in 1999, TMK manufactures and distributes high rate discharge Nickel Metal Hydride ("Ni-MH") multi-cell batteries in its manufacturing facility located in Shenzhen, China. TMK maintains a diverse roster of large, consumer-focused clients with major production facilities in China. The Company works with its clients throughout the product design cycle to develop and integrate reliable and long-lasting rechargeable power solutions for widely used consumer products, which include home appliances, cordless power tools, medical devices, multiple personal communication devices and electric bicycles segments. The Company is also focused on becoming a supplier of back-up power solutions to the telecommunications industry and for traffic lighting applications.