SHAREHOLDER TRUST AGREEMENT
Exhibit
10.15
This
agreement was undersigned by both parties on October 10, 2006 in Hailun City,
Heilongjiang Province:
Party A:
Henan Zhongpin Food Share Co., Ltd.
Legal
Address: ▇▇. ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Legal
Representative: Zhu Xianfu
Party B:
Liu Chaoyang
Address:
▇▇. ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇
Province
ID No.:
411022720520723
WHEREAS:
1. In
accordance with the “Company Law in the People’s Republic of China”, Party A
plans to invest 1 million RMB to set up a wholly-owned single member limited
liability company, Heilongjiang Zhongpin Food Co., Ltd. (hereinafter referred to
as “Heilongjiang Zhongpin”). In fact, however, during the registration process
for Heilongjiang Zhongpin, the Administration for Industry and Commerce in
Hailun City, Heilongjiang Province required that there must be two or more
shareholders to establish Heilongjiang Zhongpin.
2. After
several negotiations between Party A and the Administration for Industry and
Commerce in Hailun City, Heilongjiang Province, the request for a single member
limited liability company has not yet been approved. As a result, in order to
establish Heilongjiang Zhongpin, Party A plans to entrust Party B as a nominal
shareholder of Heilongjiang Zhongpin together with Party A to form Heilongjiang
Zhongpin. On behalf of Party A, Party B holds 10% of the equity capital of
Heilongjiang Zhongpin (a total investment of 100,000 RMB).
3. Party
B agrees to accept this consignment to be the nominal shareholder for
Heilongjiang Zhongpin, holding 10% of the equity capital of Heilongjiang
Zhongpin (for a total investment of 100,000 RMB) on behalf of Party
A.
THEREFORE,
based on the principle of equality and mutual benefit, after friendly
negotiation, both Parties agree to reach an agreement for Party A entrusting
Party B to hold its equity as follows, in order to comply and implement
together:
Section
One: Entrusting Content
1.1. Party
A voluntarily entrusts Party B as the nominal shareholder of a 100,000 RMB
investment of Heilongjiang Zhongpin, equaling 10% of the equity capital of
Heilongjiang Zhongpin. Party B shall, on Party A’s behalf, hold 10%
of the equity capital of Heilongjiang Zhongpin (hereinafter referred to as the
“Substitute Equity Capital”). To comply with Party A’s instructions, Party B
exercises the relevant rights of shareholders.
1.2. Party
A has the right to terminate this agreement at any time by notifying Party B.
Upon receipt of the notice from Party A, Party B shall take the approach
specified by Party A (including but not limited to volunteer donation, or to
take 1.00 RMB as an equivalent or methods such as naked transfer, etc.), during
its stipulated period, to transfer the Substitute Equity Capital to Party A or
another third party specified by Party A.
1.3. Party
B voluntarily accepts the above-mentioned entrustment from Party A, holding the
Substitute Equity Capital on Party A’s behalf. Party B shall exercise
the relevant rights for shareholders in accordance with Party A’s instructions,
and Party B entirely agrees with the arrangement set forth in this
agreement.
1.4. Both
sides agree that, except as set forth in Item 4.6, Party A shall pay the total
amount of 1.00 RMB as an equivalent for the entrustment under this agreement.
The payments shall be made on the effective date of this agreement.
Section
Two: Entrusting Scope
Party A
entrusts Party B with the follows rights and obligations:
1. Based
on Party A’s instructions, during Heilongjiang Zhongpin’s establishment process,
Party B shall use its own name to invest 100,000 RMB of Party A to carry out the
investment procedures for Heilongjiang Zhongpin, shall sign legal documents
related to the establishment of Heilongjiang Zhongpin and shall conduct
corresponding legal procedures.
2. Based
on Party A’s instructions, those who registered as the shareholders of
Heilongjiang Zhongpin shall sign their names on its shareholders’ list and
exercise the right to vote as Heilongjiang Zhongpin’s shareholders.
3. Based
on Party A’s instructions, those appointed as Heilongjiang Zhongpin’s Directors
or Supervisors shall exercise the right to vote as Directors or
Supervisors.
4. Based
on Party A’s instructions, Party B shall exercise the other rights of
shareholders authorized by the “Company Law in the People’s Republic of China”
and Heilongjiang Zhongpin’s stipulations.
Section
Three: Entrusting Period
The
entrusting period is from the effective date of this agreement to the
termination date explicitly notified from Party A to Party B.
Section
Four: Party A’s Rights and Obligations
4.1. Party
A, as the actual investor and holder of the Substitute Equity Capital, has the
actual and final right to dispose of the Substitute Equity Capital (including
but not limited to transfer, donation or pledge, etc.) and to obtain the
proceeds earned from Substitute Equity Capital, has the actual right of
shareholders of Heilongjiang Zhongpin, and has the actual and final right to
make decisions and take control of all matters of Heilongjiang
Zhongpin.
4.2. Party
A has the right, based on its own judgement, to give instructions at any moment
as to the rights stipulated by Section Two to Party B. Party B shall implement
such instructions unconditionally.
4.3. Party
A has the right, based on its own judgement, to take the approach specified by
Party A (including but not limited to volunteer donation, or to take 1.00 RMB as
an equivalent or methods such as naked transfer, etc.), to transfer the
Substitute Equity Capital to Party A or a specified third party. On that
occasion, Party B shall unconditionally execute the relevant legal documents
required and the relevant legal procedures to be implemented.
4.4. Party
A owns the right, based on its own judgement, to dissolve the entrustment of
Party B at any time, and ask Party B to transfer the Substitute Equity Capital
to Party A or a specified third Party in compliance with Item 4.3.
4.5. Party
A, pursuant to this agreement, holds the right to supervise and rectify Party
B’s improper entrusted conduct, and to ask for a compensation of losses
resulting from Party B’s neglectful entrustment.
4.6. All
expenditures, taxes relating to the formation and daily operation of
Heilongjiang Zhongpin, as well as all expenditures made by Party B to comply
with its obligations contained in Section Two of this agreement and expenditures
to implement this agreement, shall be assumed by Party A.
4.7. All
legal risks and investment risks related to the establishment and daily
operation of Heilongjiang Zhongpin, shall be assumed by Party A.
Section
Five: Party B’s Rights and Obligations
5.1. Party
B, entrusted by Party A, shall use its own name to hold the Substitute Equity
Capital. As a nominal holder of the Substitute Equity Capital, all the rights of
Party B are derived from the entrustment from Party A to Party B and the terms
and conditions of this agreement. Party B does not possess any right as a
shareholder of Heilongjiang Zhongpin, including the right to dispose of or earn
profits with respect to the Substitute Equity Capital or the right to make
decisions or control the affairs of Heilongjiang Zhongpin.
5.2. Without
written authorization from Party A, Party B shall not transfer or dispose of the
Substitute Equity Capital or the proceeds earned from the Substitute Equity
Capital, pledge the Substitute Equity Capital, nor implement any other conduct
that may harm Party A or Heilongjiang Zhongpin.
5.3. As
assignee, Party B holds the right, pursuant to Party A’s instruction, to
exercise the rights stipulated by Section Two of this agreement as a nominal
shareholder. However, Party B shall not use its identity as a nominal
shareholder to pursue its selfish interest or in any way that may result in an
adverse impact on Party A or Heilongjiang Zhongpin.
5.4. Without
the prior written consent of Party A, Party B shall not at any time entrust the
Substitute Equity Capital or the rights specified by Section Two of this
Agreement to a third party.
5.5. Party
B shall, based on Party A’s instruction at any moment, transfer the Substitute
Equity Capital to Party A or a third party specified by Party A, according to
the provisions of Items 4.3 and 4.4.
Section
Six: Legal Force
6.1. Upon
the signature and seal from Party A’s legal representative and Party B’s
signature, this agreement shall be effective.
6.2. If
this agreement shall be rendered null and void from pursuant any laws,
regulations, policy changes or government supervision, neither party bears any
compensation liability to the other party. The parties shall, however, based on
any solution proposed by Party A, immediately take corresponding measures to
avoid or reduce any loss for both.
Section
Seven: Confidentiality
7.1. Both
parties agree and urge the relevant insiders to assume a strict duty of
confidentiality with regard to all items under this agreement and issues
relating to the entrusted shareholding. Except as by specific stipulation of
law, or as required by the judiciary or government departments or by mutual
consent, both sides shall not make any disclosures to any third party, or else
bear the corresponding legal responsibility.
7.2. The
obligation of confidentiality on the parties is permanent, and shall survive the
termination of this agreement.
Section
Eight: Breach of Faith
Upon
entering this agreement, the two sides shall fulfill the obligations under this
agreement. Any party that does not carry out or inadequately implements the
stipulated obligations of this agreement shall bear the corresponding liability
for breaching this agreement and shall compensate the losses of the other party
accordingly.
Section
Nine: Laws and Dispute Settlement
9.1. The
subscription, operation, explanation, implementation and dispute settlement
under this agreement shall be in accordance with the laws and regulations of the
People’s Republic of China.
9.2. As
for any dispute under the agreement, both parties shall first attempt friendly
negotiation. If this fails, either party shall be entitled to submit arbitration
to the Beijing Arbitration Commission. The arbitration is final and binding on
both sides.
Section
Ten: Supplementary Articles
10.1. The
titles used in this agreement are only used as descriptions and shall not be
interpreted as an explanation of terms.
10.2. Upon
execution, if both parties sign a supplementary agreement related to this
entrusted shareholding, it shall be regarded as a valid component of this
agreement and shall have the same legal effect. If the supplementary agreement
is not in line with this one, the supplementary one shall control. If there are
several supplementary agreements, the agreement entered into last shall
control.
10.3. There
are two copies of this agreement and each party shall have one copy with equal
legal force.
10.4. The
two sides have signed this agreement on the date listed on the first page as
evidence.
(Signature
page, no text below)
Party A:
Henan Zhongpin Food Share Co., Ltd.
- Seal
-
Legal
Representative: Zhu Xianfu
/s/ Zhu
Xianfu
Party B:
Liu Chaoyang
/s/ Liu
Chaoyang