Termination and Liquidation. 20.1 Subject to Article 20.3, the Company shall be dissolved and this Contract shall be terminated (a) upon expiration of the Joint Venture Term or any extension thereof or (b) if any of the following conditions or events occur and a resolution of the Shareholders’ Meeting is adopted for such dissolution: (1) if the Parties mutually agree in writing to terminate this Contract. (2) if occurrence of any force majeure event as set forth in and subject to the provisions of Article 23 that hinders the performance of this Contract for more than one-hundred and eighty (180) days; (3) the bankruptcy or insolvency of either Party; (4) if any governmental authority having authority over either Party or the Company promulgates any policy, law or regulation that is reasonably expected to cause significant long term adverse consequences to the Company or either Party and the Parties are unable to agree upon necessary adjustments as provided in Article 22.2 hereunder; (5) the Company’s business license is revoked, or it is ordered to close down or to be dissolved according to applicable laws and regulations; or (6) the Company encounters serious difficulty in its operations or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party having applied to a competent court to dissolve the Company and the court grants approval to do so. 20.2 Subject to Articles 20.3 and 20.4, if any of the terms and conditions of this Contract is materially breached by a Party and such breach is not cured by the breaching Party within 180 days after the other Party has delivered a written notice of the breach (the “Breach Notice”) to the breaching Party, the non-breaching Party may terminate this Contract by delivering another written notice (the “Breach Termination Notice”) to the breaching Party specifying a date of termination, which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, the non-breaching Party shall have the right to request the breaching Party to indemnify the losses it has incurred or suffered in accordance with Article 21 of this Contract. 20.3 Upon occurrence of any of the following: (a) the Parties are unable to reach agreement on the extension of the Joint Venture Term at least 180 days prior to the date of expiry of the same; (b) any of termination events as set forth in Article 20.1 occurs; or (c) Party A commits a material breach of this Contract and Party B has delivered a Breach Termination Notice to Party A pursuant to Article 20.2, Party B shall be entitled, at any time prior to the later of (i) the establishment of the liquidation committee by the Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering event, to notify Party A in writing to request that Party A sells its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party B to Party A. If following the occurrence of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12. 20.4 If Party B commits a material breach of this Contract and Party A has delivered a Breach Termination Notice to Party B pursuant to Article 20.2, Party A shall be entitled, at any time prior to the later of (a) the establishment of the liquidation committee by the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A of the Breach Termination Notice to Party B, Party A does not notify Party B in writing of its request for Party B to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12. 20.5 Subject to the provisions of this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party. 20.6 Upon the expiration of the Joint Venture Term or upon earlier termination of this Contract pursuant to the foregoing provisions of this Article 20, and subject to any process as otherwise provided in this Article 20, the Company shall proceed to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and the applicable laws and regulations of the PRC. For the avoidance of doubt, the Company shall not be dissolved and liquidated in the event that the entire equity interest in the Company is acquired by Party B pursuant to any of the processes provided in this Article 20. 20.7 The Company shall set up a liquidation committee to carry out the dissolution and liquidation of the Company. The liquidation committee shall comprise of at least one representative of each of the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise the following functions and powers during the process of liquidation: (1) preparing balance sheet and list of properties and assets of the Company, and preparing the liquidation plan of the Company; (2) notifying creditors of the Company by mail or public announcement; (3) disposing and liquidating the properties and assets of the Company; (4) handling and terminating any unfinished business activities of the Company; (5) paying off outstanding taxes and the taxes, costs and expenses incurred in the process of liquidation; (6) claiming and asserting creditor rights of the Company and discharging the debts and other liabilities of the Company in accordance with applicable laws; (7) disposing the remaining properties and assets after all debts and liabilities have been repaid and discharged; (8) accounting for and distributing remaining properties and assets, and the proceeds realized from the disposal of such properties and assets to the Parties; and (9) representing the Company in legal proceedings. 20.8 The liquidation committee shall notify the creditors of the Company in such manner and within such timeframe as required under applicable laws. 20.9 The liquidation committee shall after having prepared the balance sheet and list of properties assets of the Company, submit the same to the Parties. Party B may notify the liquidation committee in writing such properties or assets of the Company (including but not limited to testing equipment, intellectual property rights and customer contracts) that it wishes to acquire, and be entitled to a pre-emptive right to acquire such properties and assets through the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those offered by such third party. 20.10 After paying off the liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with their respective shareholding percentages in the Company. 20.11 During the liquidation procedure, the Company shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee. 20.12 After the liquidation procedure of the Company is completed, the liquidation committee shall prepare a liquidation report and submit the report to the Shareholders’ Meeting for confirmation and thereafter make all necessary filings and submissions to the SAMR to cancel the Company’s registration and hand in its business license. After the de-registration of the Company with the SAMR, its original accounting books shall be retained by Party B and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration of the Company.
Appears in 2 contracts
Samples: Joint Venture Contract (UL Solutions Inc.), Joint Venture Contract (UL Solutions Inc.)
Termination and Liquidation. 20.1 15.1 Subject to Article 20.3clause 15.2, the Company this Agreement shall be dissolved and this Contract shall be terminated terminate:
(a) upon expiration written agreement of the Joint Venture Term or any extension thereof or parties in accordance with the agreed terms; or
(b) if when the Council ceases to hold any shares in MERANTUN DEVELOPMENT LTD;
(c) when a resolution is passed by the Council or creditors, or an order is made by a court or other competent body or person instituting a process that shall lead to MERANTUN DEVELOPMENT LTD being wound up and its assets being distributed among MERANTUN DEVELOPMENT LTD’s creditors, shareholder or other contributors.
15.2 On termination of this Agreement, the following clauses shall continue in force:
(a) Clause 1 (Interpretation);
(b) this clause;
(c) Clause 17 (Confidentiality);
(d) Clause 21 (Assignment and Other Dealings);
(e) Clause 22 (Entire Agreement);
(f) Clause 24 (Variation and Waiver);
(g) Clause 25 (Costs);
(h) Clause 26 (No Partnership or Agency);
(i) Clause 27 (Notices);
(j) Clause 28 (Severance);
(k) Clause 30 (Third Party Rights)
(l) Clause 33 (Inadequacy of Damages); and
(m) Clause 34 (Governing Law and Jurisdiction).
15.3 Termination of this Agreement shall not affect any rights, remedies, obligations or liabilities of the following conditions or events occur and a resolution parties that have accrued up to the date of termination, including the right to claim damages in respect of any breach of the Shareholders’ Meeting agreement which existed at or before the date of termination.
15.4 Where, following an event referred to in clause 15.1(c), MERANTUN DEVELOPMENT LTD is adopted for such to be wound up and its assets distributed, the parties shall endeavour to ensure that, before dissolution:
(1a) if the Parties mutually agree in writing to terminate this Contract.
(2) if occurrence all existing contracts of any force majeure event as set forth in and subject MERANTUN DEVELOPMENT LTD are performed to the provisions of Article 23 extent that hinders the performance of this Contract for more than one-hundred and eighty (180) daysthere are sufficient resources;
(3b) the bankruptcy or insolvency of either PartyMERANTUN DEVELOPMENT LTD shall not enter into any new contractual obligations;
(4) if any governmental authority having authority over either Party or the Company promulgates any policy, law or regulation that is reasonably expected to cause significant long term adverse consequences to the Company or either Party and the Parties are unable to agree upon necessary adjustments as provided in Article 22.2 hereunder;
(5) the Company’s business license is revoked, or it is ordered to close down or to be dissolved according to applicable laws and regulations; or
(6) the Company encounters serious difficulty in its operations or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party having applied to a competent court to dissolve the Company and the court grants approval to do so.
20.2 Subject to Articles 20.3 and 20.4, if any of the terms and conditions of this Contract is materially breached by a Party and such breach is not cured by the breaching Party within 180 days after the other Party has delivered a written notice of the breach (the “Breach Notice”) to the breaching Party, the non-breaching Party may terminate this Contract by delivering another written notice (the “Breach Termination Notice”) to the breaching Party specifying a date of termination, which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, the non-breaching Party shall have the right to request the breaching Party to indemnify the losses it has incurred or suffered in accordance with Article 21 of this Contract.
20.3 Upon occurrence of any of the following: (a) the Parties are unable to reach agreement on the extension of the Joint Venture Term at least 180 days prior to the date of expiry of the same; (b) any of termination events as set forth in Article 20.1 occurs; or (c) Party A commits a material breach of this Contract and Party B has delivered a Breach Termination Notice to Party A pursuant to Article 20.2, Party B shall be entitled, at any time prior to the later of (i) the establishment of the liquidation committee by the Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering event, to notify Party A in writing to request that Party A sells its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party AMERANTUN DEVELOPMENT LTD’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure assets are distributed as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price soon as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party B to Party A. If following the occurrence of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.4 If Party B commits a material breach of this Contract and Party A has delivered a Breach Termination Notice to Party B pursuant to Article 20.2, Party A shall be entitled, at any time prior to the later of (a) the establishment of the liquidation committee by the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A of the Breach Termination Notice to Party B, Party A does not notify Party B in writing of its request for Party B to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.5 Subject to the provisions of this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party.
20.6 Upon the expiration of the Joint Venture Term or upon earlier termination of this Contract pursuant to the foregoing provisions of this Article 20, and subject to any process as otherwise provided in this Article 20, the Company shall proceed to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and the applicable laws and regulations of the PRC. For the avoidance of doubt, the Company shall not be dissolved and liquidated in the event that the entire equity interest in the Company is acquired by Party B pursuant to any of the processes provided in this Article 20.
20.7 The Company shall set up a liquidation committee to carry out the dissolution and liquidation of the Company. The liquidation committee shall comprise of at least one representative of each of the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise the following functions and powers during the process of liquidation:
(1) preparing balance sheet and list of properties and assets of the Company, and preparing the liquidation plan of the Company;
(2) notifying creditors of the Company by mail or public announcement;
(3) disposing and liquidating the properties and assets of the Company;
(4) handling and terminating any unfinished business activities of the Company;
(5) paying off outstanding taxes and the taxes, costs and expenses incurred in the process of liquidation;
(6) claiming and asserting creditor rights of the Company and discharging the debts and other liabilities of the Company in accordance with applicable laws;
(7) disposing the remaining properties and assets after all debts and liabilities have been repaid and discharged;
(8) accounting for and distributing remaining properties and assets, and the proceeds realized from the disposal of such properties and assets to the Partiespractical; and
(9d) representing the Company in legal proceedings.
20.8 The liquidation committee any assets transferred to MERANTUN DEVELOPMENT LTD pursuant to any relevant agreement shall notify the creditors of the Company in such manner and within such timeframe as required under applicable laws.
20.9 The liquidation committee shall after having prepared the balance sheet and list of properties assets of the Company, submit the same be returned to the Parties. Party B may notify Council or dealt with as the liquidation committee in writing such properties or assets of the Company (including but not limited to testing equipment, intellectual property rights and customer contracts) that it wishes to acquire, and be entitled to a pre-emptive right to acquire such properties and assets through the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those offered by such third partyCouncil directs.
20.10 After paying off the liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with their respective shareholding percentages in the Company.
20.11 During the liquidation procedure, the Company shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee.
20.12 After the liquidation procedure of the Company is completed, the liquidation committee shall prepare a liquidation report and submit the report to the Shareholders’ Meeting for confirmation and thereafter make all necessary filings and submissions to the SAMR to cancel the Company’s registration and hand in its business license. After the de-registration of the Company with the SAMR, its original accounting books shall be retained by Party B and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration of the Company.
Appears in 1 contract
Samples: Shareholder Agreement
Termination and Liquidation. 20.1 Subject to Article 20.3, the Company shall be dissolved and this Contract shall be terminated (a) upon expiration of the Joint Venture Term or any extension thereof or (b) if 19.1 In any of the following conditions or events occur and circumstances, a resolution of the Shareholders’ Meeting is adopted for such dissolution:
(1) if the Parties mutually agree in writing to terminate this Contract.
(2) if occurrence of any force majeure event as set forth in and subject to the provisions of Article 23 that hinders the performance of this Contract for more than one-hundred and eighty (180) days;
(3) the bankruptcy or insolvency of either Party;
(4) if any governmental authority having authority over either Party or the Company promulgates any policy, law or regulation that is reasonably expected to cause significant long term adverse consequences to the Company or either Party and the Parties are unable to agree upon necessary adjustments as provided in Article 22.2 hereunder;
(5) the Company’s business license is revoked, or it is ordered to close down or to be dissolved according to applicable laws and regulations; or
(6) the Company encounters serious difficulty in its operations or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party having applied to a competent court to dissolve the Company and the court grants approval to do so.
20.2 Subject to Articles 20.3 and 20.4, if any of the terms and conditions of this Contract is materially breached by a Party and such breach is not cured by the breaching Party within 180 days after the other Party has delivered a written notice of the breach (the “Breach Notice”) to the breaching Party, the non-breaching Party may terminate this Contract by delivering another written notice (the “Breach Termination Notice”) to the breaching Party specifying a date of termination, which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, the non-breaching Party shall have the right to request terminate this Contract by giving thirty (30) days' prior written notice to the breaching other Party:
(1) the terminating Party has the right pursuant to indemnify the losses it provisions of either Article 22.4 or 24.2 to terminate this Contract; or (2) the Board of Directors determines that the activities of the Cooperative Company are for any reason no longer commercially viable or determines that the Cooperative Company be dissolved.
19.2 Under any of the following circumstances, a Party shall have the right to terminate this Contract with immediate effect by written notice to the other Party:
(1) the terminating Party has incurred the right pursuant to the provisions of Article 5.3
(1) to terminate this Contract; (2) the other Party transfers all or suffered any part of its share of the Cooperative Company's registered capital in violation of the provisions of this Contract; (3) the other Party otherwise materially breaches this Contract or materially violates the Articles of Association, and such breach or violation is not cured within sixty (60) days of written notice to the breaching/violating Party; (4) the terminating Party has the right pursuant to the provisions of Article 5.5 to terminate this Contract; or (5) the other Party is declared bankrupt, or is the subject of proceedings for bankruptcy, dissolution or liquidation, or becomes unable to pay its debts as they become due.
19.3 Without limiting the generality of the provisions of Articles 19.1 and 19.2:
(1) Party A shall have the right to terminate this Contract in accordance with the provisions of Article 21 53(1); (2) Party B shall have the right to terminate this Contract by giving written notice to Party A provided that the Cooperative Company or Parry B through the Cooperative Company has paid all direct and indirect fees or liabilities incurred by the Board of Directors and General Manager of the Cooperative Company; and (3) Upon the termination of this Contract.
20.3 Upon occurrence Contract in accordance with this Article 19.3(1), Party B shall convey, at no cost to Party A, all of any of its interest in the following: (a) Cooperative Company to Party A and Party B shall thereafter have no interest in or right to the Parties are unable Cooperative Company or its assets and Party B shall have no further obligations or liabilities arising pursuant to reach agreement on the extension of the Joint Venture Term at least 180 days this Contract except those which arise prior to the date of expiry the said written notice to Party A.
19.4 Upon termination of this Contract in accordance with Articles 19.1, 19.2 or 19.3(2), a meeting of the same; (b) any Board of Directors shall be convened and both Parties shall make all possible endeavours to cause the directors each appointed to vote in favour of a resolution to dissolve the Cooperative Company, and the Cooperative Company shall forthwith submit an application for dissolution to the Examination and Approval Authority. Each Party agrees to take all actions and to sign all documents, and to cause its appointees on the Board of Directors to all actions and to sign all documents that are legally required to effect termination events as set forth in Article 20.1 occurs; or (c) Party A commits a material breach of this Contract and Party B has delivered a Breach Termination Notice dissolution of the Cooperative Company.
19.5 Upon expiration of the Contract Tenn or approval of an application to Party A dissolve the Cooperative Company pursuant to this Article 20.219, Party B or under other circumstances in which this Contract is terminated or the Cooperative Company is dissolved, liquidation of the Cooperative Company shall be entitled, at any time prior to the later of (i) the establishment of the liquidation committee by the Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering event, to notify Party A in writing to request that Party A sells its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out handled in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party B to Party A. If following the occurrence of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.4 If Party B commits a material breach of this Contract and Party A has delivered a Breach Termination Notice to Party B pursuant to Article 20.2, Party A shall be entitled, at any time prior to the later of (a) the establishment of the liquidation committee by the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A of the Breach Termination Notice to Party B, Party A does not notify Party B in writing of its request for Party B to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.5 Subject to the provisions of this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party.
20.6 Upon the expiration of the Joint Venture Term or upon earlier termination of this Contract pursuant to the foregoing provisions of this Article 20, and subject to any process as otherwise provided in this Article 20, the Company shall proceed to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and the applicable laws and regulations of China and with the PRC. For the avoidance of doubt, the Company shall provisions set forth below (in so far as they do not be dissolved conflict with such laws and liquidated in the event that the entire equity interest in the Company is acquired by Party B pursuant to any of the processes provided in this Article 20.
20.7 The Company shall set up a liquidation committee to carry out the dissolution and liquidation of the Company. The liquidation committee shall comprise of at least one representative of each of the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise the following functions and powers during the process of liquidation:regulations):
(1) preparing balance sheet The liquidation committee, which shall report to the Board of Directors, shall be made up of five (5) members, of whom one (1) shall be appointed by Party A and list of properties four (4) shall be appointed by Party B; (2) In developing and executing the liquidation plan, the liquidation committee shall use every effort to obtain the highest possible price for the Cooperative Company's assets and, subject to compliance with Chinese foreign exchange control regulations, to sell such assets for United States Dollars or other freely convertible foreign currencies and then distribute the remaining net assets of the Company, and preparing Cooperative Company to the liquidation plan of the Company;
(2) notifying creditors of the Company by mail or public announcementParties in. accordance with their respective Participation Ratios;
(3) disposing and liquidating the properties and assets If it is necessary to appraise any of the Company;
(4) handling and terminating any unfinished business activities of the Company;
(5) paying off outstanding taxes and the taxes, costs and expenses incurred in the process of liquidation;
(6) claiming and asserting creditor rights of the Company and discharging the debts and other liabilities of the Company in accordance with applicable laws;
(7) disposing the remaining properties and assets after all debts and liabilities have been repaid and discharged;
(8) accounting for and distributing remaining properties and assets, and the proceeds realized from the disposal of such properties and assets to the Parties; and
(9) representing the Company in legal proceedings.
20.8 The liquidation committee shall notify the creditors of the Company in such manner and within such timeframe as required under applicable laws.
20.9 The liquidation committee shall after having prepared the balance sheet and list of properties assets of the Company, submit the same to the Parties. Party B may notify the liquidation committee in writing such properties or assets of the Company (including but not limited to testing equipment, intellectual property rights and customer contracts) that it wishes to acquire, and be entitled to a pre-emptive right to acquire such properties and assets through the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those offered by such third party.
20.10 After paying off the liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with their respective shareholding percentages in the Company.
20.11 During the liquidation procedure, the Company shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee.
20.12 After the liquidation procedure of the Company is completedliquidated, the liquidation committee shall prepare appoint a liquidation report Sino-Foreign joint venture accounting firm registered in China and submit independent of either Party to handle thus work; and (4) Party B, at its own expense, shall have the report right to the Shareholders’ Meeting for confirmation and thereafter make obtain copies of all necessary filings and submissions to the SAMR to cancel the Company’s registration and hand in its business license. After the de-registration of the Company with the SAMRCooperative Company's accounting vouchers, its original accounting books shall be retained by Party B account books, account statements, minutes and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration resolutions of the CompanyBoard of Directors and other relevant documents after the conclusion of liquidation.
Appears in 1 contract
Samples: Cooperative Joint Venture Contract (Magnus International Resources, Inc.)
Termination and Liquidation. 20.1 Subject 27.01 For the purpose of this Article 27, a Party shall mean either A or B.
27.02 This Contract may be terminated if the Parties agree in writing that a termination of the Contract is in the best interests of the Parties, due to
(1) circumstances which make it impossible for the Company to Article 20.3operate effectively (failure to attain business goals and lack of future development), or
(2) the conditions or consequences of Force Majeure prevailing for a period in excess of six (6) months which have rendered the Company unable to continue the operation, or
(3) any other reasons. The Parties shall do their utmost to avoid a liquidation of the Company. Thus, before agreeing on termination, the Parties shall evaluate possibilities to continue the operation of the Company by one Party or by a third party. In the termination agreement, the Parties may agree that a Party may purchase by itself or have a third party purchase the other Party’s capital contribution and continue the operation of the Company. If both Parties are willing to purchase or have a third party purchase the other Party’s capital contribution, the Party which offers the higher price for the respective capital contribution shall have the right to purchase or have a third party purchase it. If the Company cannot continue to be operated in this way, its liquidation may be decided by the Board. Any such assignment or decision on liquidate shall be dissolved submitted to the Examination and Approval Authority for approval.
27.03 Under the following circumstances, either Party may terminate this Contract shall be terminated (a) upon expiration of by written notice to the Joint Venture Term or any extension thereof or (b) if any of the following conditions or events occur and a resolution of the Shareholders’ Meeting is adopted for such dissolutionother Party:
(1) if If a Party or any member of it materially breaches this Contract or the Parties mutually agree in writing to terminate this Contract.Articles of Association (i.e. seriously infringes the non-breaching Party’s and/or the Company's interests) and such breach is not cured within fifteen (15) days after receipt of written notice from the non-breaching Party;
(2) if occurrence If a Party or any member of any force majeure event as set forth it assigns or encumbers its capital contribution in and subject to the Company in violation of the provisions of Article 23 that hinders the performance of this Contract for more than one-hundred and eighty (180) daysContract;
(3) If a member of the bankruptcy other Party is declared bankrupt or insolvency is the subject of either proceedings for liquidation or dissolution or ceases to carry on business, or becomes unable to pay its debts as they become due and therefore is subject to conciliation and reorganization or receivership, and if in such case the other members of the other Party do not or cannot take over the affected member's capital contribution and/or the Subordinated Shareholder Loans in the Company within thirty (30) days after receipt of written notice from the non-affected Party;
(4) if any governmental authority having authority over either Party or If the accumulated losses of the Company promulgates any policy, law or regulation that is reasonably expected to cause significant long term adverse consequences to after start of commercial production exceed seventy percent (70%) of the Company or either Party registered capital and the Parties are unable to agree upon necessary adjustments reach an agreement for the restructuring of the Company's capitalization within thirty (30) days of receipt of written notice by either Party from the other Party.
27.04 No Party shall exercise its unilateral termination right as provided for in Article 22.2 hereunder;
(5) the Company’s business license is revoked, or it is ordered to close down or to be dissolved according to applicable laws and regulations; or
(6) the Company encounters serious difficulty in its operations or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party 27.03 without having applied to a competent court to dissolve the Company and the court grants approval to do so.
20.2 Subject to Articles 20.3 and 20.4, if any of the terms and conditions of this Contract is materially breached by a Party and such breach is not cured by the breaching Party within 180 days after consulted with the other Party has delivered a written notice in order to find an equitable solution. Such equitable solution may include an assignment of capital contribution within one Party.
27.05 If either Party's economic interests are adversely and materially effected by the promulgation of any new law of China or the amendment of any existing law of China after the signing of the breach Contract, such Party shall inform the other Party thereof in writing. The Parties shall then immediately consult with each other in order to find a feasible solution and they shall
(the “Breach Notice”1) use all lawful efforts to the breaching Party, the non-breaching reduce these adverse effects to a minimum and
(2) try to reach an agreement to avoid a unilateral termination. Either Party may terminate this Contract by delivering another if no agreement has been reached within twelve (12) months from the written notice information mentioned above.
27.06 In the circumstances of Article 27.03 sub-paragraphs (1) and (2), the “Breach Termination Notice”) Party failing to implement the obligations specified in the Contract and the Articles of Association and materially breaching the Contract shall be liable for compensating the losses thus caused to the breaching Party specifying a date of terminationother Party.
27.07 If this Contract is terminated pursuant to Article 27.03 sub-paragraphs (1) or (2), which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, then the non-breaching Party shall have the right and option to request purchase by itself or to cause a third party to purchase the capital contribution of the breaching member of the other Party ("Purchase Option").
27.08 If this Contract is terminated according to Article 27.03 sub-paragraph (3), then the non-affected Party shall have the Purchase Option for the capital contribution of the affected member of the other Party.
27.09 If the Contract is terminated according to Article 27.03 sub-paragraph (4), then either Party wishing to implement a restructuring shall have a Purchase Option. If both Parties, separately, are willing to implement a restructuring, then the Party which offers the higher price for the respective capital contribution shall have the Purchase Option. If neither Party is willing to implement a restructuring and no third party is willing to continue the operation of the Company, the Company shall be liquidated, unless otherwise decided by the Board.
27.10 In the event this Contract is terminated according to Article 27.05, the terminating Party shall have the right to cause the other Party to indemnify purchase itself or to cause a third party to purchase its capital contribution ("Sale Option") and the losses it has incurred other Party shall have a Purchase Option.
27.11 The Party having a Purchase Option or suffered Sale Option according to Articles 27.07 through 27.10 shall exercise this option by written notice to the other Party within thirty (30) days after the written notice on termination of the Contract. If a Purchase Option cannot be exercised and consumed because of legal or political reasons attributable to China, then the Party having the Purchase Option shall have a Sale Option.
27.12 If a Purchase Option is exercised or in case of an assignment in accordance with Article 21 27.09 with the result of members of both Parties still participating in the Company, then this ContractContract shall be continued between such members of both Parties and shall be amended accordingly.
20.3 Upon occurrence 27.13 Any change of any of the following: (a) the Parties are unable to reach agreement on the extension of the Joint Venture Term at least 180 days prior to the date of expiry of the same; (b) any of termination events as set forth in Article 20.1 occurs; or (c) Party A commits a material breach of this Contract and Party B has delivered a Breach Termination Notice to Party A pursuant to Article 20.2, Party B shall be entitled, at any time prior to the later of (i) the establishment of the liquidation committee by the Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering event, to notify Party A in writing to request that Party A sells its entire equity interest in the Company to Party B at shall conform with the relevant Chinese laws and regulations. The exercise of a price equal to the Fair Market Value of such equity interest. Any such sale Purchase Option or Sale Option shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party B to Party A. If following the occurrence approval of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution Examination and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.4 If Party B commits a material breach of this Contract and Party A has delivered a Breach Termination Notice to Party B pursuant to Article 20.2, Party A shall be entitled, at any time prior to the later of (a) the establishment of the liquidation committee by the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of Approval Authority. After receiving such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A of the Breach Termination Notice to Party B, Party A does not notify Party B in writing of its request for Party B to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.5 Subject to the provisions of this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party.
20.6 Upon the expiration of the Joint Venture Term or upon earlier termination of this Contract pursuant to the foregoing provisions of this Article 20, and subject to any process as otherwise provided in this Article 20, the Company shall proceed register the change of equity interest with the State Administration for Industry and Commerce.
27.14 Each Party shall be obliged to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and ensure that at least up to the applicable laws and regulations assignment of its capital contribution the PRC. For the avoidance operation of doubt, the Company shall not be dissolved interrupted by any such assignment and liquidated that negative effects are kept to a minimum. After the assignment, they are obligated to continue at reasonable conditions such services, deliveries, rights etc. which are vital for the operation of the Company. Services and deliveries shall not be interrupted until new contracts have been concluded in accordance with the above mentioned principle.
27.15 In the event that the entire equity interest Contract is terminated by any Party for any reason covered in Article 27.03 or 27.05 and the Party having the Purchase Option or Sale Option does not exercise its option, the Company is acquired shall be liquidated, unless otherwise decided upon by Party B pursuant to any of the processes provided in this Article 20Board.
20.7 The Company shall set up a liquidation committee to carry out the 27.16 For dissolution and liquidation of the Company, the Board shall prepare an application for dissolution and submit it to the relevant Examination and Approval Authority for approval. The liquidation committee shall comprise date of at least one representative of each of approval for the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise the following functions and powers during the process of liquidation:
(1) preparing balance sheet and list of properties and assets of the Company, and preparing the liquidation plan of the Company;
(2) notifying creditors dissolution of the Company by mail or public announcement;
(3) disposing the Examination and liquidating Approval Authority shall be the properties and assets date of commencement of the liquidation of the Company;.
(4) handling and terminating any unfinished business activities 27.17 With the approval of the Company;Board, the liquidation committee may employ necessary experts and working personnel to handle concrete matters of liquidation.
(5) paying off outstanding taxes 27.18 When the property to be liquidated is sold off, the Parties shall have the right of first refusal and the taxes, costs and expenses incurred in property shall be purchased by the process Party which offers the highest price.
27.19 The remaining property after the clearance of liquidation;
(6) claiming and asserting creditor rights debts of the Company and discharging the debts and other liabilities shall be sold or disposed of the Company in accordance with applicable laws;
(7) disposing the remaining properties and assets after all debts and liabilities have been repaid and discharged;
(8) accounting for and distributing remaining properties and assets, and the proceeds realized from the disposal of such properties and assets to the Parties; and
(9) representing the Company in legal proceedings.
20.8 The liquidation committee shall notify the creditors of the Company in such manner and within such timeframe as required under applicable laws.
20.9 The liquidation committee shall after having prepared the balance sheet and list of properties assets of the Company, submit the same to the Parties. Party B may notify the liquidation committee in writing such properties or assets of the Company (including but not limited to testing equipment, intellectual property rights and customer contracts) that it wishes to acquire, and be entitled to a pre-emptive right to acquire such properties and assets through the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those offered by such third party.
20.10 After paying off the liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with according to the proportion of their respective shareholding percentages in the Companycapital contributions.
20.11 During the liquidation procedure, the Company shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee.
20.12 After the liquidation procedure 27.20 On completion of the Company is completedliquidation, the liquidation committee shall prepare submit a liquidation report and submit the completion report to the Shareholders’ Meeting original Examination and Approval Authority after adoption by the Board, and the Company shall go through the formalities for confirmation and thereafter make all necessary filings and submissions to nullifying its registration in the SAMR to cancel the Company’s original registration authority and hand in back its business license. .
27.21 After the de-registration conclusion of the Company with the SAMR, its original accounting books shall be retained by Party B and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration of the Company, all the accounting books and documents shall be left in the care of A.
27.22 In the event that the Company fails to set up the liquidation committee within fifteen (15) days starting from the date of commencement of liquidation or that the liquidation committee comes across serious obstacles in its work and it is impossible for it to submit the liquidation report to the Examination and Approval Authority within six (6) months starting from the date of commencement of liquidation, any Party may make an application to the Court for liquidation.
27.23 If the Company has been declared to be bankrupt according to law, the relevant laws and administrative regulations on liquidation in bankruptcy shall be followed.
Appears in 1 contract
Samples: Joint Venture Agreement (Medical International Technology Inc)
Termination and Liquidation. 20.1 Subject 14.1 Prior to Article 20.3the expiration of the Term, a Party and/or the Company shall be dissolved Parties may terminate this Articles of Association and this Contract shall be terminated the WFOE as follows (but subject to Section 14.3):
(a) upon expiration By written instrument of termination executed by both of the Joint Venture Term or any extension thereof or Parties;
(b) if By written notice of termination by a Party given to the other Party in the event that a final determination is made by a Governmental Entity or court with competent jurisdiction over the matter that it is unlawful for the WFOE or its business to be carried on or any substantially material provision of this Articles of Association shall be invalid, unlawful or unenforceable;
(c) By written notice of termination by a Party given to the other Party in the event that all or a significant part of the following conditions or events occur and a resolution assets of the Shareholders’ Meeting is adopted for such dissolution:WFOE are expropriated by any Governmental Entity;
(1d) By written notice of termination by a Party given to the other Party at or after the occurrence of a Bankruptcy Event with respect to the WFOE if the Parties mutually agree in writing occurrence of the Bankruptcy Event with respect to terminate this Contract.the WFOE would have a material adverse effect on the business, financial condition or results of operations of the WFOE;
(2e) if occurrence By written notice of any force majeure event as set forth in and subject termination by a Party given to the provisions other Party in the event that a Force Majeure Event resulting in a material adverse effect on the business, financial condition or results of Article 23 that hinders operations of the performance WFOE continues for a consecutive period of this Contract for more than one-one hundred and eighty (180) days;
(f) By written notice of termination by a Party given to the other Party at or after the entry of a decree of judicial dissolution of the WFOE under applicable Law;
(g) By written notice of termination by a Party given to the other Party at or after the sale, abandonment or other disposition by the WFOE of all or substantially all of its assets, business or properties, provided that, for clarification, the pledge, hypothecation or encumbrance of any or all of the WFOE's assets, business or properties shall not, in itself, constitute a sale, abandonment or other disposition for the purpose of this Section 14.1(g);
(h) By written notice of termination by a Party given to the other Party in the event of a continuing material breach by the other Party of any material provision of this Articles of Association, if all of the following applies: (1) the breach is not cured within thirty (30) days after the receipt by the breaching Party of written determination of the court with competent jurisdiction or an arbitrator to the effect that the Party has breached any such material provision or, if the breach is not reasonably capable of being cured within such thirty (30) days so long as the breaching Party continues to use good faith and reasonable efforts to effectuate the cure but in any event not longer than one-hundred eighty (180) days of receipt of such written determination, (2) the breach is not compensable solely by the payment of money damages, (3) the bankruptcy WFOE or insolvency a Party has become subject to criminal liability or suffered a material adverse effect on its reputation, business, financial condition or results of either Party;
(4) if any governmental authority having authority over either Party operations as a result of the breach or the Company promulgates any policy, law or regulation terminating Party has suffered a material adverse effect on its financial condition and results of operations taken as a whole as a result of the breach (provided that is reasonably expected this clause (3) shall not apply to cause significant long term adverse consequences to the Company or either Party and the Parties are unable to agree upon necessary adjustments as provided in a breach of Article 22.2 hereunder;
(5) the Company’s business license is revoked, or it is ordered to close down or to be dissolved according to applicable laws and regulations12 of this Articles of Association); or
(6i) the Company encounters serious difficulty in its operations or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party having applied to a competent court to dissolve the Company and the court grants approval to do so.
20.2 Subject to Articles 20.3 and 20.4, if any By written notice of the terms and conditions of this Contract is materially breached termination by a Party and such breach is not cured by the breaching Party within 180 days after given to the other Party has delivered Party, if the WFOE suffers significant losses during any fiscal year for a written notice reason other than the happening of a Force Majeure Event; for purposes of this Section, "significant losses" means aggregate losses in a fiscal year amounting to twenty-five percent (25%) or more of the breach (amount of the “Breach Notice”) registered capital of the WFOE. In the event that a Party elects to the breaching Party, the non-breaching Party may terminate this Contract by delivering another written notice (Articles of Association and the “Breach Termination Notice”) to the breaching Party specifying a date of termination, which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, the non-breaching Party shall have the right to request the breaching Party to indemnify the losses it has incurred or suffered in accordance with Article 21 of this Contract.
20.3 Upon occurrence of any of the following: (a) the Parties are unable to reach agreement on the extension of the Joint Venture Term at least 180 days prior to the date of expiry of the same; (b) any of termination events as set forth in Article 20.1 occurs; or (c) Party A commits a material breach of this Contract and Party B has delivered a Breach Termination Notice to Party A WFOE pursuant to Article 20.2, Party B shall be entitled, at any time prior to the later of (i) the establishment of the liquidation committee by the Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering event, to notify Party A in writing to request that Party A sells its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets)this Section 14.1, the Parties shall use all reasonable efforts cause their respective representatives on the Board of Directors to complete unanimously approve the sale termination of Party A’s equity interest pursuant to this Articles of Association and the foregoing within 120 days (which WFOE as promptly as practical after such election.
14.2 Except as provided in Section 14.1 above, and except only as may be reasonably extended required under applicable Law, no other act or occurrence shall cause a termination of this Articles of Association or the WFOE, it being the intention of the Parties that any other act or occurrence that would otherwise cause such a termination be waived by the Parties to the fullest extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party B to Party A. If following the occurrence of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12permitted under applicable Law.
20.4 If Party B commits a material breach of this Contract and Party A has delivered a Breach Termination Notice to Party B pursuant to Article 20.2, Party A shall be entitled, at any time prior to the later of (a) the establishment of the liquidation committee by the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A of the Breach Termination Notice to Party B, Party A does not notify Party B in writing of its request for Party B to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.5 Subject to the provisions of this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party.
20.6 14.3 Upon the expiration of the Joint Venture Term Term, or upon the earlier termination of this Contract pursuant the WFOE due to any situation described in Section 14.1, upon the unanimous resolution of the Board of Directors and the approval of the original Examination and Approval Authority, the liquidation procedures shall commence according to the foregoing provisions Measures for the Liquidation of this Article 20, Foreign Invested Enterprises and subject other applicable Laws of China. The Parties shall cause their respective representatives on the Board of Directors to any process as otherwise provided in this Article 20, unanimously approve the Company shall proceed to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and the applicable laws and regulations of the PRC. For the avoidance of doubt, the Company shall not be dissolved and liquidated in the event that the entire equity interest in the Company is acquired by Party B pursuant to any of the processes provided in this Article 20.
20.7 The Company shall set up a liquidation committee to carry out the dissolution termination and liquidation of the Company. The liquidation committee shall comprise WFOE as promptly as practical after the occurrence of at least one representative of each of the events specified in Section 14.1 hereof but in any event not later than 30 days after any such occurrence (unless the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise shall otherwise agree in writing).
14.4 Prior to the following functions and powers during sale of any assets of the process WFOE, each Party shall have the first priority right to a return of liquidationthe following:
(1a) preparing balance sheet all intellectual property and list of properties rights and assets of the Company, and preparing the liquidation plan of the Company;
(2) notifying creditors of the Company by mail or public announcement;
(3) disposing and liquidating the properties and assets of the Company;
(4) handling and terminating any unfinished business activities of the Company;
(5) paying off outstanding taxes and the taxes, costs and expenses incurred in the process of liquidation;
(6) claiming and asserting creditor rights of the Company and discharging the debts and other liabilities of the Company in accordance with applicable laws;
(7) disposing the remaining properties and assets after all debts and liabilities have been repaid and discharged;
(8) accounting for and distributing remaining properties and assets, and the proceeds realized from the disposal of such properties and assets to the Partiesknow-how; and
(9b) representing all installations, machinery, equipment, contract rights and other items of a proprietary nature, Such returned items shall be credited toward each Party's liquidation distribution at the Company in legal proceedings.
20.8 The liquidation committee shall notify the creditors then fair market value of the Company in such manner and within such timeframe as required under applicable laws.
20.9 The liquidation committee shall after having prepared the balance sheet and list of properties assets of the Companysaid items, submit the same to the Parties. Party B may notify or if the liquidation committee in writing distribution to which such properties or assets Party would have been entitled is insufficient to cover the value of the Company (including but not limited to testing equipmentsaid items, intellectual property rights and customer contracts) that it wishes to acquire, and then such Party shall be entitled to a pre-emptive right to acquire such properties and assets through the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those offered by such third partypurchase them at their then fair market value.
20.10 After paying off the 14.5 Upon completion of liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with their respective shareholding percentages in the Company.
20.11 During the liquidation procedureWFOE, the Company Liquidation Committee shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee.
20.12 After the liquidation procedure of the Company is completed, the liquidation committee shall prepare submit a liquidation report and submit the proceedings wind-up report to the Shareholders’ Meeting Board of Directors for confirmation approval and thereafter make all necessary filings and submissions submission to the SAMR Examination and Approval Authority and carry out necessary procedures to cancel the Company’s WFOE's Business License, tax registration, customs registration and hand in its business license. After the de-registration of the Company with the SAMR, its original accounting books shall be retained by Party B and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration of the Companyother necessary administrative formalities.
Appears in 1 contract
Termination and Liquidation. 20.1 Subject Article 104 Each Party shall have the right to Article 20.3, the Company shall be dissolved and terminate this Contract shall be terminated (a) upon prior to the expiration of the Joint Venture Contract Term or any extension thereof or (b) by written notice to the other Party if any of the following conditions or events occur and a resolution of the Shareholders’ Meeting is adopted for such dissolutionoccur:
(1) if in the Parties mutually agree event that either party fails to make its capital contribution, in writing to terminate whole or in part, within [90] days of the due date, or in the event that any of the conditions precedent set forth in Article 34 of this Contract.Contract have not been satisfied or waived within [120] days of the date on which this Contract is signed by the parties;
(2) if occurrence the other Party materially breaches this Contract or materially violates the Articles of any force majeure event as set forth in Association, and subject such breach or violation is not cured within sixty (60) days of written notice to the provisions of Article 23 that hinders the performance of this Contract for more than one-hundred and eighty (180) daysbreaching/violating Party;
(3) the bankruptcy Joint Venture Company or insolvency the other Party becomes bankrupt, or is the subject of either Partyproceedings for liquidation or dissolution, or ceases to carry on business, or becomes unable to pay its debts as they come due;
(4) if the other Party transfers all or any governmental authority having authority over either Party or part of its share of the Company promulgates any policy, law or regulation that is reasonably expected to cause significant long term adverse consequences to Joint Venture Company's registered capital in violation of the Company or either Party and the Parties are unable to agree upon necessary adjustments as provided in Article 22.2 hereunderprovisions of this Contract;
(5) any government authority having authority over any Party requires any provision of this Contract or the Company’s business license is revoked, or it is ordered to close down or Articles of Association to be dissolved according revised in such a way as to applicable laws and regulations; orcause significant adverse consequences to the Joint Venture Company or any Party;
(6) the Company encounters serious difficulty in its operations conditions or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if consequences of Force Majeure prevail with the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party having applied to result of a competent court to dissolve the Company and the court grants approval to do so.
20.2 Subject to Articles 20.3 and 20.4, if any of the terms and conditions of this Contract is materially breached by a Party and such breach is not cured by the breaching Party within 180 days after the other Party has delivered a written notice of the breach (the “Breach Notice”) major impairment to the breaching Party, the non-breaching Party may terminate this Contract by delivering another written notice (the “Breach Termination Notice”) to the breaching Party specifying a date of termination, which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, the non-breaching Party shall have the right to request the breaching Party to indemnify the losses it has incurred or suffered in accordance with Article 21 of this Contract.
20.3 Upon occurrence of any of the following: (a) the Parties are unable to reach agreement on the extension functioning of the Joint Venture Term at least 180 days prior Company for a period in excess of six (6) months and the Parties have been unable to find an equitable solution; or
(7) the date of expiry of Parties cannot implement the same; (b) any of termination events as set forth economic adjustment described in Article 20.1 occurs; or (c) 119. Article 105 If any Party A commits a material breach of gives notice to terminate this Contract and Party B has delivered a Breach Termination Notice to Party A pursuant to Article 20.2, Party B shall be entitled, at any time prior to the later of (i) the establishment of the liquidation committee by the Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering event, to notify Party A in writing to request that Party A sells its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets)104, the Parties shall use all reasonable efforts endeavour to complete resolve the sale problem through negotiation and agreement. If, within thirty (30) days of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by receipt of such notice, the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified have not agreed in writing by Party B to Party A. If following the occurrence of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed abovecontinue this Contract, then each Party and the Company directors appointed by each Party shall proceed be deemed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 have agreed to 20.12.
20.4 If Party B commits a material breach of terminate this Contract and Party A has delivered a Breach Termination Notice dissolve the Joint Venture Company. An application for the same shall forthwith be submitted to Party B the Examination and Approval Authority. Article 106 Following an application to dissolve the Joint Venture Company pursuant to Article 20.2105, Party A the Board of Directors shall be entitled, at any time prior to the later of (a) the establishment of the forthwith appoint a liquidation committee by which shall have the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice power to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A of the Breach Termination Notice to Party B, Party A does not notify Party B in writing of its request for Party B to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.5 Subject to the provisions of this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party.
20.6 Upon the expiration of represent the Joint Venture Term or upon earlier termination of this Contract pursuant to the foregoing provisions of this Article 20, and subject to any process as otherwise provided Company in this Article 20, the Company shall proceed to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and the applicable laws and regulations of the PRC. For the avoidance of doubt, the Company shall not be dissolved and liquidated in the event that the entire equity interest in the Company is acquired by Party B pursuant to any of the processes provided in this Article 20.
20.7 The Company shall set up a liquidation committee to carry out the dissolution and liquidation of the Companyall legal matters. The liquidation committee shall comprise of at least one representative of each of value and liquidate the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise the following functions and powers during the process of liquidation:
(1) preparing balance sheet and list of properties and Joint Venture Company's assets of the Company, and preparing the liquidation plan of the Company;
(2) notifying creditors of the Company by mail or public announcement;
(3) disposing and liquidating the properties and assets of the Company;
(4) handling and terminating any unfinished business activities of the Company;
(5) paying off outstanding taxes and the taxes, costs and expenses incurred in the process of liquidation;
(6) claiming and asserting creditor rights of the Company and discharging the debts and other liabilities of the Company in accordance with the applicable laws;
(7) disposing the remaining properties Chinese laws and assets after all debts and liabilities have been repaid and discharged;
(8) accounting for and distributing remaining properties and assets, regulations and the proceeds realized from the disposal of such properties and assets to the Parties; and
(9) representing the Company in legal proceedingsprinciples set forth herein.
20.8 The liquidation committee shall notify the creditors of the Company in such manner and within such timeframe as required under applicable laws.
20.9 The liquidation committee shall after having prepared the balance sheet and list of properties assets of the Company, submit the same to the Parties. Party B may notify the liquidation committee in writing such properties or assets of the Company (including but not limited to testing equipment, intellectual property rights and customer contracts) that it wishes to acquire, and be entitled to a pre-emptive right to acquire such properties and assets through the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those offered by such third party.
20.10 After paying off the liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with their respective shareholding percentages in the Company.
20.11 During the liquidation procedure, the Company shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee.
20.12 After the liquidation procedure of the Company is completed, the liquidation committee shall prepare a liquidation report and submit the report to the Shareholders’ Meeting for confirmation and thereafter make all necessary filings and submissions to the SAMR to cancel the Company’s registration and hand in its business license. After the de-registration of the Company with the SAMR, its original accounting books shall be retained by Party B and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration of the Company.
Appears in 1 contract
Termination and Liquidation. 20.1 Subject to Article 20.3, the Company shall be dissolved and this Contract shall be terminated (a) upon expiration of the Joint Venture Term or any extension thereof or (b) if any of the following conditions or events occur and a resolution of the Shareholders’ Meeting is adopted for such dissolution:
(1) if the Parties mutually agree in writing to terminate this Contract.
(2) if occurrence of any force majeure event as set forth in and subject to the provisions of Article 23 that hinders the performance of this Contract for more than one-hundred and eighty (180) days;
(3) the bankruptcy or insolvency of either Party;
(4) if any governmental authority having authority over either Party or the Company promulgates any policy, law or regulation that is reasonably expected to cause significant long term adverse consequences to the Company or either Party and the Parties are unable to agree upon necessary adjustments as provided in Article 22.2 hereunder;
(5) the Company’s business license is revoked, or it is ordered to close down or to be dissolved according to applicable laws and regulations; or
(6) the Company encounters serious difficulty in its operations or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party having applied to a competent court to dissolve the Company and the court grants approval to do so.
20.2 Subject to Articles 20.3 and 20.4, if any of the terms and conditions of this Contract is materially breached by a Party and such breach is not cured by the breaching Party within 180 days after the other Party has delivered a written notice of the breach (the “Breach Notice”) to the breaching Party, the non-breaching Party may terminate this Contract by delivering another written notice (the “Breach Termination Notice”) to the breaching Party specifying a date of termination, which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, the non-breaching 14.1 Any Party shall have the right to request terminate the Joint Venture Contract prior to the expiration of the Contract Term or any extension thereof, by written notice to the other Party, if any of the following events occur:
(a) the circumstances described in Articles 5.4;
(b) the circumstances described in Article 5.6;
(c) the circumstances described in Article 6.20;
(d) The other Party materially breaches the Joint Venture Contract or materially violates the Articles of Association, and such breach or violation is not cured within sixty (60) days of written notice to the breaching/violating Party; provided, however, that if the material breach or material violation cannot reasonably be cured within sixty (60) days or such longer term as the Parties may agree, but the breaching or violating Party commences to indemnify cure the losses it breach or violation within the 60-day period and diligently continues to cure the breach or violation, the non-breaching or non-violating Party shall not have the right to terminate the Joint Venture Contract, unless the breaching or violating Party has incurred not cured the breach or suffered violation within six (6) months after that sixty (60) days period or such longer term the Parties had agreed upon;
(e) the JV Company or the other Party becomes bankrupt, or is the subject of proceedings for liquidation or dissolution, or ceases to carry on business, or becomes unable to pay its debts as they come due;
(f) the other Party transfers or mortgages, pledges or otherwise encumbers all or any part of its equity interest in the JV Company in violation of the provisions of the Joint Venture Contract;
(g) any government authority having authority over any Party requires any provision of the Joint Venture Contract, the License Contract, the Business License or these Articles of Association to be revised in such a way as to cause significant adverse consequences to the JV Company or any of the Parties. In such case, neither Party may xxx the other Party for breaching of its obligation under Article 5.3;
(h) the assets of the JV Company, in whole or in substantial part, are nationalized or confiscated;
(i) the conditions or consequences of an Excusing Event (as defined in Article 20 of the Joint Venture Contract) prevail with the result of a major impairment to the functioning of the JV Company for a period in excess of six (6) months, and the Parties have been unable to find an equitable solution pursuant to Article 20 of the Joint Venture Contract;
(j) any Ancillary Contract is terminated other than the breaching Party; or
(k) any other termination event, as specified in PRC laws and regulations, occurs.
14.2 In the event that any Party gives notice to terminate the Joint Venture Contract pursuant to Article 14.1(b), Party A or a third party designated by Party A shall purchase from Party B and Party B shall assign to Party A or such a third party whatever interest Party B may have under this Contract and in the JV Company for a price of US$ 10. Within 10 days of the date of the notice of termination, the Parties shall sign a contract for assignment of Party B’s interest mentioned in the immediately preceding sentence and shall cause the directors appointed by them to approve the contract for assignment. The form and substance of the contract for assignment shall be substantially similar to those of the one attached hereto as Appendix 4 of the Joint Venture Contract. The Parties shall further submit the contract for assignment and other related documents to the Examination and Approval Authority for approval.
14.3 If any Party gives notice to terminate the Joint Venture Contract pursuant to Articles 14.1 (other than Article 14.1(b)), then the Parties shall endeavor to resolve the problem through negotiation and agreement. If, within sixty (60) days of a Party’s receipt of such termination notice, the Parties have not agreed in writing to continue the Joint Venture Contract, then Party A shall have the right to purchase all of Party B’s interest in the registered capital of the JV Company (a “Buyout”) subject to the terms and conditions of Articles 14.5 and 14.6. Without limitation to the foregoing, the Buyout right of Party A set forth above shall not apply in the event of a breach by Party A (or any of its Affiliates) under Articles 14.1(a), (d), (f) or (j);
14.4 If Party B gives notice to terminate the Joint Venture Contract pursuant to Articles 14.1(a), (d), (f) or (j), then the Parties shall endeavor to resolve the problem through negotiation and agreement. If, within sixty (60) days of Party A’s receipt of such termination notice, the Parties have not agreed in writing to continue the Joint Venture Contract, then Party B shall have the right to sell all of Party B’s interest in the registered capital of the JV Company and Party A shall have the obligation to buy Party B’s interest in the registered capital of the JV Company subject to the terms and conditions of Articles 14.5 and 14.6.
14.5 Within 30 days following the sixty (60) day period referred to in Article 14.3, Party A may serve a notice on Party B, in which Party A exercises its right to buy out Party B’s interest in the JV Company in accordance with Article 21 14.3 (“Party A Notice”). Within 30 days following the sixty (60) day period referred to in Article 14.4 , Party B may serve a notice on Party A, in which Party B requests Party A to buy out Party B’s interest in the JV Company in accordance with Article 14.4 (“Party B Notice”). Upon receipt of this Contractthe Party A Notice or the Party B Notice, as the case may be, the Parties shall promptly negotiate the price at which Party A may purchase Party B’s interest in the JV Company (“Buyout Price”).
20.3 Upon occurrence of any 14.6 If the Parties fail to agree on the Buyout Price within thirty (30) days from the date of the following: (a) Party A Notice or the Party B Notice, as the case may be, the Parties are unable shall, unless otherwise agreed, jointly conduct a valuation for the purpose of determining the Buyout Price. For such valuation, each Party shall nominate an independent and competent appraiser within forty-five (45) days from the date of the Party A Notice or the Party B Notice, as the case may be. Within seventy-five (75) days from the Date of the Party A Notice or the Party B Notice, as the case may be, the appraisers shall make their determination of the Buyout Price in a written report setting forth detailed reasons for such determination. If the two (2) appraisers cannot agree on a valuation and their respective valuations differ by no more than ten percent (10%) of the higher one, the average of the two (2) valuations shall be the Buyout Price. If the two (2) valuations differ by more than ten percent (10%) of the higher one, then the Parties shall proceed to reach liquidate the JV Company pursuant to this Article 14.
14.7 After the Buyout Price has been determined pursuant to Article 14.5 or Article 14.6, the Parties shall enter into an agreement for transfer of interest in the registered capital of the JV Company, and each Party shall cause the directors appointed by such Party to approve the agreement.
14.8 If Party A does not exercise its Buyout right within thirty (30) days following the sixty (60)-day period provided for in Article 14.5, or Party B does not request Party A to purchase Party B’s interest in the JV Company in accordance with Article 14.5, or the two (2) valuations differ by more than ten percent (10%) of the higher one, then each Party and the directors on the extension of Board appointed by each Party shall be deemed to have agreed both to terminate the Joint Venture Term at least 180 days prior Contract and to dissolve the JV Company. An application for termination and dissolution of the JV Company shall be submitted to the date of expiry of Examination and Approval Authority.
14.9 Following an application to dissolve the same; (b) any of termination events as set forth in Article 20.1 occurs; or (c) Party A commits a material breach of this Contract and Party B has delivered a Breach Termination Notice to Party A JV Company pursuant to Article 20.214.8, Party B the Board shall be entitled, at any time prior to the later of (i) the establishment of the forthwith appoint a liquidation committee by that shall have the power to represent the JV Company in all legal matters. The liquidation committee shall value and liquidate the JV Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering event, to notify Party A in writing to request that Party A sells its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out ’s assets in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating and the principles set forth herein.
14.10 The liquidation committee shall be made up of three (3) members: Party A shall appoint two (2) members and Party B shall appoint one (1) member. Members of the liquidation committee may, but need not be, directors or senior employees of the JV Company. The liquidation committee may engage a lawyer and an accountant registered in such procedure (including exercising its right the PRC to assist the liquidation committee. When permitted by PRC law, any Party may also appoint professional advisors to assist the liquidation committee. The Board shall report the formation of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related the liquidation committee to the disposal relevant PRC government department in charge of state-owned assets)the JV Company.
14.11 The liquidation committee shall conduct a thorough examination of the JV Company’s assets and liabilities, on the basis of which it shall develop a liquidation plan. If approved by the Board of Directors, such liquidation plan shall be executed under the liquidation committee’s supervision.
14.12 During the liquidation procedures, Party A shall use reasonable efforts have the option to exclude any third party whose primary businesspurchase the assets of the JV Company which are used specifically for the production and /or testing of the JV Products at their original book value, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. and fully depreciated.
14.13 Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party B to Party A. If following the occurrence of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.4 If Party B commits a material breach of this Contract and Party A has delivered a Breach Termination Notice to Party B pursuant to Article 20.2, Party A shall be entitled, at any time prior to the later of (a) the establishment of the liquidation committee by the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating regulations, the liquidation expenses, including remuneration to members and the lawyers and accountants assisting the liquidation committee, shall be paid out of the JV Company’s assets in priority to the claims of other creditors.
14.14 After the liquidation and division of the JV Company’s assets and the settlement of all of its outstanding debts, the balance shall be paid over to the Parties in proportion to their respective holdings in the equity interest of the registered capital of the JV Company at the time of liquidation. Party B shall have a priority to receive its share of the balance in foreign exchange.
14.15 On completion of all liquidation work, the liquidation committee shall provide to the Examination and Approval Authority a liquidation completion report which has been approved by the Board, shall hand in the JV Company’s Business License to the original registration authority, and shall complete all other formalities for nullifying the JV Company’s registration in the PRC and other jurisdictions, where applicable. Party B shall have a right to obtain, at its own expense, copies of all of the JV Company’s accounting books and other documents; but the originals of such procedure (including exercising its right books and documents shall be left in the care of pre-emption pursuant to Article 19.1 or Party A. Except as otherwise provided under applicable PRC law to purchase such equity interest in Articles 12 and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related 14 of these Articles of Association, neither Party shall have any further obligations or liabilities to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason JV Company or the occurrence other Party under these Articles of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A Association upon completion of the Breach Termination Notice to Party B, Party A does not notify Party B in writing liquidation of its request for Party B to purchase Party A’s equity interest in the JV Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12this Article 14.
20.5 Subject to 14.16 The obligations and benefits set forth in the liquidation provisions of in this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B 14 shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing survive termination or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party.
20.6 Upon the expiration of the Joint Venture Term or upon earlier termination of this Contract pursuant to the foregoing provisions of this Article 20, and subject to any process as otherwise provided in this Article 20, the Company shall proceed to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and the applicable laws and regulations of the PRC. For the avoidance of doubt, the Company shall not be dissolved and liquidated in the event that the entire equity interest in the Company is acquired by Party B pursuant to any of the processes provided in this Article 20Contract.
20.7 The Company shall set up a liquidation committee to carry out the dissolution and liquidation of the Company. The liquidation committee shall comprise of at least one representative of each of the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise the following functions and powers during the process of liquidation:
(1) preparing balance sheet and list of properties and assets of the Company, and preparing the liquidation plan of the Company;
(2) notifying creditors of the Company by mail or public announcement;
(3) disposing and liquidating the properties and assets of the Company;
(4) handling and terminating any unfinished business activities of the Company;
(5) paying off outstanding taxes and the taxes, costs and expenses incurred in the process of liquidation;
(6) claiming and asserting creditor rights of the Company and discharging the debts and other liabilities of the Company in accordance with applicable laws;
(7) disposing the remaining properties and assets after all debts and liabilities have been repaid and discharged;
(8) accounting for and distributing remaining properties and assets, and the proceeds realized from the disposal of such properties and assets to the Parties; and
(9) representing the Company in legal proceedings.
20.8 The liquidation committee shall notify the creditors of the Company in such manner and within such timeframe as required under applicable laws.
20.9 The liquidation committee shall after having prepared the balance sheet and list of properties assets of the Company, submit the same to the Parties. Party B may notify the liquidation committee in writing such properties or assets of the Company (including but not limited to testing equipment, intellectual property rights and customer contracts) that it wishes to acquire, and be entitled to a pre-emptive right to acquire such properties and assets through the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those offered by such third party.
20.10 After paying off the liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with their respective shareholding percentages in the Company.
20.11 During the liquidation procedure, the Company shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee.
20.12 After the liquidation procedure of the Company is completed, the liquidation committee shall prepare a liquidation report and submit the report to the Shareholders’ Meeting for confirmation and thereafter make all necessary filings and submissions to the SAMR to cancel the Company’s registration and hand in its business license. After the de-registration of the Company with the SAMR, its original accounting books shall be retained by Party B and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration of the Company.
Appears in 1 contract
Termination and Liquidation. 20.1 15.1 Subject to Article 20.3clause 15.2, the Company this Agreement shall be dissolved and this Contract shall be terminated terminate:
(a) upon expiration written agreement of the Joint Venture Term or any extension thereof or parties in accordance with the agreed terms; or
(b) if whenthe Council ceases to hold any shares in [MERANTUN DEVELOPMENT LTD];
(c) when a resolution is passed by the Council or creditors, or an order is made by a court or other competent body or person instituting a process that shall lead to [MERANTUN DEVELOPMENT LTD] being wound up and its assets being distributed among [MERANTUN DEVELOPMENT LTD’s] creditors, shareholder or other contributors.
15.2 On termination of this Agreement, the following clauses shall continue in force:
(a) Clause 1 (Interpretation);
(b) this clause;
(c) Clause 17 (Confidentiality);
(d) Clause 21 (Assignment and Other Dealings);
(e) Clause 22 (Entire Agreement);
(f) Clause 24 (Variation and Waiver);
(g) Clause 25 (Costs);
(h) Clause 26 (No Partnership or Agency);
(i) Clause 27 (Notices);
(j) Clause 28 (Severance);
(k) Clause 33 (Inadequacy of Damages);
(l) Clause 35 (Governing Law and Jurisdiction); [and OR.]
(m) [INCLUDE ANY OTHER RELEVANT PROVISIONS5.
15.3 Termination of this Agreement shall not affect any rights, remedies, obligations or liabilities of the following conditions or events occur and a resolution parties that have accrued up to the date of termination, including the right to claim damages in respect of any breach of the Shareholders’ Meeting agreement which existed at or before the date of termination.
15.4 Where, following an event referred to in clause 15.1(c), [MERANTUN DEVELOPMENT LTD] is adopted for such to be wound up and its assets distributed, the parties shall endeavour to ensure that, before dissolution:
(1a) if the Parties mutually agree in writing to terminate this Contract.
(2) if occurrence all existing contracts of any force majeure event as set forth in and subject [MERANTUN DEVELOPMENT LTD] are performed to the provisions of Article 23 extent that hinders the performance of this Contract for more than one-hundred and eighty (180) daysthere are sufficient resources;
(3b) the bankruptcy or insolvency of either Party[MERANTUN DEVELOPMENT LTD] shall not enter into any new contractual obligations;
(4) if any governmental authority having authority over either Party or the Company promulgates any policy, law or regulation that is reasonably expected to cause significant long term adverse consequences to the Company or either Party and the Parties are unable to agree upon necessary adjustments as provided in Article 22.2 hereunder;
(5) the Company’s business license is revoked, or it is ordered to close down or to be dissolved according to applicable laws and regulations; or
(6) the Company encounters serious difficulty in its operations or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party having applied to a competent court to dissolve the Company and the court grants approval to do so.
20.2 Subject to Articles 20.3 and 20.4, if any of the terms and conditions of this Contract is materially breached by a Party and such breach is not cured by the breaching Party within 180 days after the other Party has delivered a written notice of the breach (the “Breach Notice”) to the breaching Party, the non-breaching Party may terminate this Contract by delivering another written notice (the “Breach Termination Notice”) to the breaching Party specifying a date of termination, which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, the non-breaching Party shall have the right to request the breaching Party to indemnify the losses it has incurred or suffered in accordance with Article 21 of this Contract.
20.3 Upon occurrence of any of the following: (a) the Parties are unable to reach agreement on the extension of the Joint Venture Term at least 180 days prior to the date of expiry of the same; (b) any of termination events as set forth in Article 20.1 occurs; or (c) Party A commits a material breach of this Contract and Party B has delivered a Breach Termination Notice to Party A pursuant to Article 20.2, Party B shall be entitled, at any time prior to the later of (i) the establishment of the liquidation committee by the Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering event, to notify Party A in writing to request that Party A sells its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure [MERANTUN DEVELOPMENT LTD’s] assets are distributed as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price soon as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party B to Party A. If following the occurrence of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.4 If Party B commits a material breach of this Contract and Party A has delivered a Breach Termination Notice to Party B pursuant to Article 20.2, Party A shall be entitled, at any time prior to the later of (a) the establishment of the liquidation committee by the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A of the Breach Termination Notice to Party B, Party A does not notify Party B in writing of its request for Party B to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.5 Subject to the provisions of this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party.
20.6 Upon the expiration of the Joint Venture Term or upon earlier termination of this Contract pursuant to the foregoing provisions of this Article 20, and subject to any process as otherwise provided in this Article 20, the Company shall proceed to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and the applicable laws and regulations of the PRC. For the avoidance of doubt, the Company shall not be dissolved and liquidated in the event that the entire equity interest in the Company is acquired by Party B pursuant to any of the processes provided in this Article 20.
20.7 The Company shall set up a liquidation committee to carry out the dissolution and liquidation of the Company. The liquidation committee shall comprise of at least one representative of each of the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise the following functions and powers during the process of liquidation:
(1) preparing balance sheet and list of properties and assets of the Company, and preparing the liquidation plan of the Company;
(2) notifying creditors of the Company by mail or public announcement;
(3) disposing and liquidating the properties and assets of the Company;
(4) handling and terminating any unfinished business activities of the Company;
(5) paying off outstanding taxes and the taxes, costs and expenses incurred in the process of liquidation;
(6) claiming and asserting creditor rights of the Company and discharging the debts and other liabilities of the Company in accordance with applicable laws;
(7) disposing the remaining properties and assets after all debts and liabilities have been repaid and discharged;
(8) accounting for and distributing remaining properties and assets, and the proceeds realized from the disposal of such properties and assets to the Partiespractical; and
(9d) representing the Company in legal proceedings.
20.8 The liquidation committee any assets transferred to [MERANTUN DEVELOPMENT LTD]pursuant to any relevant agreement shall notify the creditors of the Company in such manner and within such timeframe as required under applicable laws.
20.9 The liquidation committee shall after having prepared the balance sheet and list of properties assets of the Company, submit the same be returned to the Parties. Party B may notify Council or dealt with as the liquidation committee in writing such properties or assets of the Company (including but not limited to testing equipment, intellectual property rights and customer contracts) that it wishes to acquire, and be entitled to a pre-emptive right to acquire such properties and assets through the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those offered by such third partyCouncil directs.
20.10 After paying off the liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with their respective shareholding percentages in the Company.
20.11 During the liquidation procedure, the Company shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee.
20.12 After the liquidation procedure of the Company is completed, the liquidation committee shall prepare a liquidation report and submit the report to the Shareholders’ Meeting for confirmation and thereafter make all necessary filings and submissions to the SAMR to cancel the Company’s registration and hand in its business license. After the de-registration of the Company with the SAMR, its original accounting books shall be retained by Party B and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration of the Company.
Appears in 1 contract
Samples: Shareholder Agreement
Termination and Liquidation. 20.1 Subject to Article 20.3, the Company shall be dissolved and this Contract shall be terminated (a) upon expiration of the Joint Venture Term or any extension thereof or (b) if any of the following conditions or events occur and a resolution of the Shareholders’ Meeting is adopted for such dissolution:
(1) if the Parties mutually agree in writing to terminate this Contract.
(2) if occurrence of any force majeure event as set forth in and subject to the provisions of Article 23 that hinders the performance of this Contract for more than one-hundred and eighty (180) days;
(3) the bankruptcy or insolvency of either Party;
(4) if any governmental authority having authority over either Party or the Company promulgates any policy, law or regulation that is reasonably expected to cause significant long term adverse consequences to the Company or either Party and the Parties are unable to agree upon necessary adjustments as provided in Article 22.2 hereunder;
(5) the Company’s business license is revoked, or it is ordered to close down or to be dissolved according to applicable laws and regulations; or
(6) the Company encounters serious difficulty in its operations or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party having applied to a competent court to dissolve the Company and the court grants approval to do so.
20.2 Subject to Articles 20.3 and 20.4, if any of the terms and conditions of this Contract is materially breached by a Party and such breach is not cured by the breaching Party within 180 days after the other Party has delivered a written notice of the breach (the “Breach Notice”) to the breaching Party, the non-breaching Party may terminate this Contract by delivering another written notice (the “Breach Termination Notice”) to the breaching Party specifying a date of termination, which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, the non-breaching 104 Each Party shall have the right to request terminate this Contract prior to the breaching expiration of the Contract Term by written notice to the other Party to indemnify the losses it has incurred or suffered in accordance with Article 21 of this Contract.
20.3 Upon occurrence of if any of the following: following events occur:
(a1) In the Parties are event that either Party fails to make its capital contribution, in whole or in part, within ninety (90) days of the due date, or in the event that any of the conditions precedent set forth in Article 35 of this Contract have not been satisfied or waived within one hundred twenty (120) days of the date on which this Contract is signed by the Parties;
(2) The other Party materially breaches this Contract or materially violates the Articles of Association, and such breach or violation is not cured within sixty (60) days of written notice to the breaching/violating Party;
(3) The Joint Venture Company or the other Party becomes bankrupt, or is the subject of proceedings for liquidation or dissolution, or ceases to carry on business, or becomes unable to reach agreement on the extension pay its debts as they come due;
(4) The other Party transfers all or any part of its share of the Joint Venture Term at least 180 days prior to the date of expiry Company's registered capital in violation of the same; provisions of this Contract;
(b5) Any government authority having authority over any of termination events as set forth in Article 20.1 occurs; or (c) Party A commits a material breach requires any provision of this Contract or the Articles of Association to be revised in such a way as to cause significant adverse consequences to the Joint Venture Company or any Party;
(6) The conditions or consequences of Force Majeure prevail with the result of a major impairment to the functioning of the Joint Venture Company for a period in excess of six (6) months and the Parties have been unable to find an equitable solution; or
(7) The Parties cannot implement the economic adjustment described in Article 120. Article 105 If any Party B has delivered a Breach Termination Notice gives notice to Party A terminate this Contract pursuant to Article 20.2104, the Parties shall endeavour to resolve the problem through negotiation and agreement. If, within thirty (30) days of receipt of such notice, the Parties have not agreed in writing to continue this Contract, then each Party B and the directors appointed by each Party shall be entitled, at any time prior deemed to have agreed to terminate this Contract and dissolve the Joint Venture Company. An application for the same shall forthwith be submitted to the later Examination and Approval Authority. Article 106 Following an application to dissolve the Joint Venture Company pursuant to Article 105, the Board of Directors shall forthwith appoint a liquidation committee which shall have the power to represent the Joint Venture Company in all legal matters. The liquidation committee shall value and liquidate the Joint Venture Company's assets in accordance with the applicable Chinese laws and regulations and the principles set forth herein. Article 107 The liquidation committee shall be made up of three (i3) the establishment members, of whom one (1) member shall be nominated by Party A and two (2) members shall be nominated by Party B. Members of the liquidation committee by the Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering eventmay, to notify Party A in writing to request that Party A sells its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisalbut need not be, administrative approval, public listing directors or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party B to Party A. If following the occurrence of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.4 If Party B commits a material breach of this Contract and Party A has delivered a Breach Termination Notice to Party B pursuant to Article 20.2, Party A shall be entitled, at any time prior to the later of (a) the establishment of the liquidation committee by the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A of the Breach Termination Notice to Party B, Party A does not notify Party B in writing of its request for Party B to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.5 Subject to the provisions of this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party.
20.6 Upon the expiration senior employees of the Joint Venture Term or upon earlier termination of this Contract pursuant to the foregoing provisions of this Article 20, and subject to any process as otherwise provided in this Article 20, the Company shall proceed to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and the applicable laws and regulations of the PRC. For the avoidance of doubt, the Company shall not be dissolved and liquidated in the event that the entire equity interest in the Company is acquired by Party B pursuant to any of the processes provided in this Article 20.
20.7 The Company shall set up a liquidation committee to carry out the dissolution and liquidation of the Company. The liquidation committee may engage a lawyer and an accountant registered in China to assist the liquidation committee. When permitted by Chinese law, any Party may also appoint professional advisors to assist the liquidation committee. The Board of Directors shall comprise of at least one representative of each report the formation of the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise to the following functions and powers during the process of liquidation:
(1) preparing balance sheet and list of properties and assets department in charge of the Joint Venture Company, and preparing the liquidation plan of the Company;
(2) notifying creditors of the Company by mail or public announcement;
(3) disposing and liquidating the properties and assets of the Company;
(4) handling and terminating any unfinished business activities of the Company;
(5) paying off outstanding taxes and the taxes, costs and expenses incurred in the process of liquidation;
(6) claiming and asserting creditor rights of the Company and discharging the debts and other liabilities of the Company in accordance with applicable laws;
(7) disposing the remaining properties and assets after all debts and liabilities have been repaid and discharged;
(8) accounting for and distributing remaining properties and assets, and the proceeds realized from the disposal of such properties and assets to the Parties; and
(9) representing the Company in legal proceedings.
20.8 . Article 108 The liquidation committee shall notify the creditors conduct a thorough examination of the Company in such manner Joint Venture Company's assets and within such timeframe as required liabilities, on the basis of which it shall develop a liquidation plan, which, if approved by the Board of Directors, shall be executed under applicable laws.
20.9 The the liquidation committee shall after having prepared committee's supervision. Article 109 Upon liquidation, the balance sheet and list of properties Party which originally contributed or sold (directly or indirectly) assets of to the Joint Venture Company, submit the same to the Parties. Party B may notify the liquidation committee in writing such properties or assets of the Company (including but not limited to testing equipmenttechnology assets that were contributed to the Joint Venture Company through license, intellectual property rights and customer contracts) that it wishes to acquire, and be entitled to shall have a pre-emptive priority right to acquire purchase such properties and assets through if the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those price offered by such third party.
20.10 After paying off Party is not less favourable than other offers received by the Joint Venture Company. Article 110 In developing and executing the liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with their respective shareholding percentages in the Company.
20.11 During the liquidation procedure, the Company shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee.
20.12 After the liquidation procedure of the Company is completedplan, the liquidation committee shall prepare a liquidation report and submit use every effort to obtain the report highest possible price for the Joint Venture Company's assets and, subject to the Shareholders’ Meeting compliance with PRC foreign exchange control regulations, sell such assets for confirmation and thereafter make all necessary filings and submissions to the SAMR to cancel the Company’s registration and hand in its business license. After the de-registration of the Company with the SAMR, its original accounting books shall be retained by Party B and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration of the CompanyUnited States Dollars or other freely convertible foreign currencies.
Appears in 1 contract
Termination and Liquidation. 20.1 16.1 Subject to Article 20.3clause 16.2 this agreement shall terminate when there is only one Member.
16.2 On termination of this agreement, the Company following clauses shall be dissolved continue in force:
a( ) Clause 1 i(nterpretation);
b( ) this clause;
c( ) Clause 18 c( onfidentiality); d( ) Clause 23 a( ssignment and other dealings) ; e( ) Clause 24 (entire agreement); f() Clause 25 v( ariation and waiver); g( ) Clause 26 (costs); h( ) Clause 27 (no partnership or agency); i() Clause 28 (notices;) j() Clause 29 (severance); k( ) Clause 34 i(nadequacy of damages); and l() Clause 35 g( o verning law and jurisdiction).
16.3 Termination of this Contract agreement shall be terminated (a) upon expiration not affect any rights, remedies, obligations or liabilities of the Joint Venture Term or any extension thereof or (b) if any of the following conditions or events occur and a resolution of the Shareholders’ Meeting is adopted for such dissolution:
(1) if the Parties mutually agree in writing to terminate this Contract.
(2) if occurrence of any force majeure event as set forth in and subject to the provisions of Article 23 Members that hinders the performance of this Contract for more than one-hundred and eighty (180) days;
(3) the bankruptcy or insolvency of either Party;
(4) if any governmental authority having authority over either Party or the Company promulgates any policy, law or regulation that is reasonably expected to cause significant long term adverse consequences to the Company or either Party and the Parties are unable to agree upon necessary adjustments as provided in Article 22.2 hereunder;
(5) the Company’s business license is revoked, or it is ordered to close down or to be dissolved according to applicable laws and regulations; or
(6) the Company encounters serious difficulty in its operations or management and is consequently unable to substantially realize its desired purpose as stated in this Contract and if the Company continues to operate, the shareholders will suffer significant losses and such difficulty cannot be solved by any other means, either Party having applied to a competent court to dissolve the Company and the court grants approval to do so.
20.2 Subject to Articles 20.3 and 20.4, if any of the terms and conditions of this Contract is materially breached by a Party and such breach is not cured by the breaching Party within 180 days after the other Party has delivered a written notice of the breach (the “Breach Notice”) to the breaching Party, the non-breaching Party may terminate this Contract by delivering another written notice (the “Breach Termination Notice”) to the breaching Party specifying a date of termination, which shall be a date at least 180 days following the Breach Termination Notice, and, in addition, the non-breaching Party shall have the right to request the breaching Party to indemnify the losses it has incurred or suffered in accordance with Article 21 of this Contract.
20.3 Upon occurrence of any of the following: (a) the Parties are unable to reach agreement on the extension of the Joint Venture Term at least 180 days prior accrued up to the date of expiry termination,including the right to claim damages in respect of any breach of the same; (b) any agreement which existed at or before the date of termination events as set forth in Article 20.1 occurs; or (c) Party A commits a material breach of termination.
16.4 If this Contract and Party B has delivered a Breach Termination Notice to Party A pursuant to Article 20.2, Party B shall be entitled, at any time prior to agreement terminates each party shall,if requested by the later of (i) other,procure that the establishment name of the liquidation committee Company is changed to avoid confusion with the name o f the par ty making the request.
16.5 Where and only where a party elects by written notice served on the Company; and (ii) the expiry of a ninety (90)-day period following the occurrence of the relevant triggering event, to notify Party A in writing to request that Party A sells its entire equity interest in other party for the Company to Party B at a price equal to be wound up in the Fair Market Value of such equity interest. Any such sale shall be subject to and carried specific circumstances which are set out in accordance with then applicable laws this agreement , the Members shall agree a suitable basis for dealing wi th the interests and regulations (including those relating to the disposal assets of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject consistent with the principles set out in clause 16.6 and shall endeavour to any State-owned asset appraisalensure that, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right before dissolution:
a( ) all existing contracts of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties Company are performed to the extent necessary due to any then prevailing legal or regulatory reason or that the occurrence of a force majeure eventre are sufficient resources;
b( ) following the request notified in writing by Party B to Party A. If following the occurrence of the relevant triggering event, Party B does not notify Party A in writing of its request to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.4 If Party B commits a material breach of this Contract and Party A has delivered a Breach Termination Notice to Party B pursuant to Article 20.2, Party A shall be entitled, at any time prior to the later of (a) the establishment of the liquidation committee by the Company; and (b) the expiry of a ninety (90)-day period following the delivery by Party A of the Breach Termination Notice to Party B, to notify Party B in writing to request that Party B purchases the entire equity interest in the Company held by Party A at a price equal to the Fair Market Value of such equity interest. Any such sale shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure as a buyer unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the request notified in writing by Party A to Party B. If following the delivery by Party A of the Breach Termination Notice to Party B, Party A does not notify Party B in writing of its request for Party B to purchase Party A’s equity interest in the Company within the timeframe prescribed above, then the Company shall proceed to carry out the dissolution and liquidation procedure in accordance with Articles 20.6 to 20.12.
20.5 Subject to the provisions of this Article 20.5, if a Change of Control Involving Competitor occurs in respect of Party A, Party B shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party A, to notify Party A in writing to require Party A to sell its entire equity interest in the Company to Party B at a price equal to the Fair Market Value of such equity interest. If a Change of Control Involving Competitor occurs in respect of Party B, Party A shall be entitled, in its sole discretion and at any time following such Change of Control Involving Competitor in respect of Party B, to notify Party B in writing to require Party B to purchase Party A’s entire equity interest in the Company at a price equal to the Fair Market Value of such equity interest. Any sale of Party A’s equity interest pursuant to the foregoing shall be subject to and carried out in accordance with then applicable laws and regulations (including those relating to the disposal of state-owned assets). If the then applicable laws and regulations require that any sale of Party A’s equity interest in the Company be subject to any State-owned asset appraisal, administrative approval, public listing or bidding procedure, then such procedure shall be complied with and Party B shall acknowledge and agree to follow such procedure. Party A agrees that Party B may participate in such procedure unless Party B is prohibited by applicable PRC laws and regulations from participating in such procedure (including exercising its right of pre-emption pursuant to Article 19.1 or otherwise as provided under applicable PRC law to purchase such equity interest and at such price as determined pursuant to such procedure). Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), Party A shall use reasonable efforts to exclude any third party whose primary business, by revenue, consists of testing, inspection and/or certification of third-party products and/or services. Subject to compliance with then applicable laws and regulations (including those related to the disposal of state-owned assets), the Parties shall use all reasonable efforts to complete the sale of Party A’s equity interest pursuant to the foregoing within 120 days (which may be reasonably extended by the Parties to the extent necessary due to any then prevailing legal or regulatory reason or the occurrence of a force majeure event) following the initial request notified in writing by Party A or Party B, as applicable. For the purpose of this Article 20.5, a “Change of Control Involving Competitor” of a Party (the “Change of Control Party”) means, (a) any consolidation, amalgamation, merger, scheme of arrangement or similar business combination transaction or reorganization of the Change of Control Party by, with or into any other Person, or (b) the acquisition of more than 50% of the outstanding equity interests or voting rights in the Change of Control Party, in each case such that immediately following such transaction a competitor of the other Party or of the Company (other than any Affiliate of the Change of Control Party) (i) owns in the aggregate more than 50% of the outstanding equity interests or voting rights in the Change of Control Party (or the surviving entity in such transaction) or (ii) has the right to appoint or nominate a majority of the members of the board or similar governing body of the Change of Control Party (or the surviving entity in such transaction). Notwithstanding the foregoing, (x) a public listing of securities of a Party or any of its Affiliates, or (y) if a Party is publicly listed or is under the direct or indirect control of an Affiliate that is publicly listed, then any acquisition, disposal, issuance or other transaction in the shares of the relevant publicly listed entity shall not constitute a “Change of Control Involving Competitor” of such Party.
20.6 Upon the expiration of the Joint Venture Term or upon earlier termination of this Contract pursuant to the foregoing provisions of this Article 20, and subject to any process as otherwise provided in this Article 20, the Company shall proceed to be dissolved and liquidated in accordance with Articles 20.7 through 20.12 and the applicable laws and regulations of the PRC. For the avoidance of doubt, the Company shall not be dissolved enter into any new contractual obligations; and
c( ) the Company 's assets are d istributed as soon as practical.
16.6 The parties have agreed to the following principles to govern financial liabilities arising upon t he Company being wound up : f inancial and liquidated in employment liabilities for any staff seconded or transferred other than under Tupe from City will remain the event liability of City and City shall indemnify and keep indemnified the County against any f inancial and empl oyment Liabilities ;
a( ) financial and employment liabilities for any staff seconded or transferred other than under Tupe from County will remain the liability of County and County shall indemnify and keep indemnified the City against any financial and employ ment liabilities ;
b( ) The parties agree that the entire equity interest in secondment of their staff for the provision of services to the Company is acquired by Party B pursuant will not be a relevant transfer in relation to such staff but if any such staff assert Tupe rights against the other party then any TUPE implications and liabilities will be the responsibility and liability of the processes provided in this Article 20.
20.7 The Company organisation transferring the related posts and shall set up a liquidation committee to carry indemnify the other party against all employee liabilities arising out the dissolution and liquidation of the Company. The liquidation committee shall comprise of at least one representative of each of the Parties and such other persons (including professional advisors) as permitted or required under applicable law. The liquidation committee may exercise the following functions and powers during the process of liquidation:
(1) preparing balance sheet and list of properties and assets of the Company, and preparing the liquidation plan of the Company;
(2) notifying creditors Tupe inrespect of the Company by mail being wound up or public announcement;
(3) disposing and liquidating ot herwise that arise during the properties and assets period of the Company;
(4) handling and terminating any unfinished business activities of the Company;
(5) paying off outstanding taxes and the taxes, costs and expenses incurred in the process of liquidation;
(6) claiming and asserting creditor rights of the Company and discharging the debts and other liabilities of the Company in accordance with applicable laws;
(7) disposing the remaining properties and assets after all debts and liabilities have been repaid and discharged;
(8) accounting for and distributing remaining properties and assets, and the proceeds realized from the disposal of such properties and assets to the Parties; and
(9) representing the Company in legal proceedingsSecondment .
20.8 The liquidation committee shall notify the creditors of the Company in such manner and within such timeframe as required under applicable laws.
20.9 The liquidation committee shall after having prepared the balance sheet and list of properties assets of the Company, submit the same to the Parties. Party B may notify the liquidation committee in writing such properties or assets of the Company (including but not limited to testing equipment, intellectual property rights and customer contracts) that it wishes to acquire, and be entitled to a pre-emptive right to acquire such properties and assets through the asset disposal and liquidation procedure administered by the liquidation committee, provided that where a valid offer for any such property or asset has been received from a third party, Party B shall exercise such pre-emptive right on terms and conditions taken as a whole that are not less favorable to Party A than those offered by such third party.
20.10 After paying off the liquidation expenses (including remuneration of the liquidation committee, any expenses in connection with the legal proceedings, and expenses incurred in the common interest of creditors), wages of employees, social insurance contributions and other employees liabilities, outstanding taxes, debts and liabilities of the Company, any properties or assets (or the proceeds realized from the disposal of such properties and assets) remaining thereafter shall be distributed among the Parties in accordance with their respective shareholding percentages in the Company.
20.11 During the liquidation procedure, the Company shall continue to exist but shall not carry out any business or trading activities other than such activities strictly related to the purpose of liquidation as determined by the liquidation committee.
20.12 After the liquidation procedure of the Company is completed, the liquidation committee shall prepare a liquidation report and submit the report to the Shareholders’ Meeting for confirmation and thereafter make all necessary filings and submissions to the SAMR to cancel the Company’s registration and hand in its business license. After the de-registration of the Company with the SAMR, its original accounting books shall be retained by Party B and copies shall be kept by Party A. The liquidation committee shall also make a public announcement regarding the ceased-registration of the Company.
Appears in 1 contract
Samples: Members’ Agreement
