Exhibit 5
[NAME IN CHINESE]
(HUACHEN AUTOMOTIVE GROUP HOLDINGS COMPANY LIMITED)
AND
HONG XING
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CALL OPTION AGREEMENT
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XXXXX &
00xx Xxxxx Xxxxxxxxx Xxxxx
00 Xxxxxxxx Xxxx
Xxxx Xxxx
LKL/EC/DK/DK01938.FIN2(HONG)(Clean).DOC
CONTENTS
CLAUSE HEADING PAGE
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1. Definitions and Interpretation..............................................................1
2. Call Option.................................................................................3
3. Further Obligations of the Parties..........................................................4
4. Restriction on Announcements................................................................6
5. General.....................................................................................6
6. Governing Law and Submission to Jurisdiction................................................7
Execution ............................................................................................8
DATE:
PARTIES:
(1) [NAME IN CHINESE] (HUACHEN AUTOMOTIVE GROUP HOLDINGS COMPANY LIMITED),
a wholly state-owned limited liability company established in the
People's Republic of China whose legal address is at 00 Xxxxxxxxxxx
Xxxx, Xxxxxxx Xxxxxxxx, Xxxxxxxx City, Liaoning Province 110032, PRC (
"HUACHEN"); and
(2) HONG XING of Suites 2303 - 2306, 23rd Floor, Great Xxxxx Xxxxxx, 00
Xxxxxxx Xxxx, Xxxxxxx, Xxxx Xxxx ("MR. HONG").
RECITALS:
(A) Pursuant to a sale and purchase agreement entered into between Huachen
and the Foundation on the date hereof, the Foundation agreed to sell,
and Huachen agreed to purchase, a total of 1,446,121,500 Shares
beneficially owned by the Foundation, representing approximately 39.45%
of the total issued share capital of the Company and the Foundation's
entire interest in the Company, and Huachen has agreed to make the
Offer, in each case subject to the terms and conditions set out
therein.
(B) On the date hereof, the Offerors agreed to form a syndicate for the
purpose of making the Offer.
(C) Huachen agrees to grant to Mr. Hong a call option in respect of
84,464,788 Shares upon the terms and conditions hereinafter contained.
TERMS AGREED:
1. DEFINITIONS AND INTERPRETATION
1.01 In this Deed where the context so admits the following words and
expressions shall have the following meanings:
"ADS" means an American depositary share representing ownership of 100
Shares in the issued share capital of the Company;
"COMPANY" means Brilliance China Automotive Holdings Limited;
"EVENT OF DEFAULT" means failure on the part of Mr. Hong to pay the
Balance in full on or before the relevant due date pursuant to Clause
3.01(a);
"FOUNDATION" means Chinese Financial Education Development Foundation,
a non-governmental non-profit making organisation established in the
PRC;
"HK$" means Hong Kong dollars, the lawful currency for the time being
of Hong Kong;
"HONG KONG" means the Hong Kong Special Administrative Region of the
PRC;
"OFFER" means the conditional cash offer to be made by CLSA Limited on
behalf of the Offerors in accordance with the Takeovers Code for the
Offer Shares as described in clause 4.01 of the Principal Agreement and
in the manner as shall be approved by the Executive Director for the
time being of the Corporate Finance Division of the Securities and
Futures Commission of Hong Kong and any delegate for the time being of
the Executive Director;
"OFFER SHARES" means the existing issued Shares (whether in the form of
ordinary shares with a par value of US$0.01 each in the capital of the
Company or ADSs) but excluding the Sale Shares and any other Shares
(whether in the form of ordinary shares with a par value of US$0.01
each in the capital of the Company or ADSs) owned by the Offerors and
parties acting in concert with them (within the meaning of the
Takeovers Code) on the date of this Deed and/or acquired or agreed to
be acquired by the Offerors and parties acting in concert with them
(within the meaning of the Takeovers Code) while the Offer remains open
for acceptance;
"OFFERORS" means Huachen, Mr. Hong, Xx. Xx Xiao An (also known as Xx
Xxx On), Mr. Su Qiang (also known as So Keung) and Mr. He Tao (also
known as Ho To);
"OPTION PERIOD" means the period of 3 years commencing from the date
falling 6 months after the earlier of:
(a) the end of the Offer; and
(b) the close of the Offer in accordance with the offer document
to be issued by the Offerors in respect of the Offer as
required under the Takeovers Code;
"OPTION SHARES" means 84,464,788 Shares;
"PARTIES" means the parties executing this Deed and "PARTY" means
either one of them;
"PRC" means the People's Republic of China but excluding, for the
purposes of this Deed, Hong Kong, Macau Special Administrative Region
of the PRC and Taiwan;
"PRINCIPAL AGREEMENT" means the sale and purchase agreement entered
into between Huachen and the Foundation on the date hereof in respect
of, inter alia, the sale and purchase of the Sale Shares;
"SALE SHARES" means the 1,446,121,500 Shares acquired by Huachen
pursuant to the Principal Agreement;
"SHARES" means ordinary shares with a par value of US$0.01 each in the
capital of the Company; and
"TAKEOVERS CODE" means the Hong Kong Code on Takeovers and Mergers; and
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"US$" means United States dollars, the lawful currency of the United
States of America.
1.02 The expressions "HUACHEN" and "MR. HONG" shall, where the context
permits, include their respective successors, personal representatives
and permitted assigns.
1.03 Unless the context requires otherwise, words importing the singular
include the plural and vice versa and words importing a gender include
every gender.
1.04 In construing this Deed:
(a) the rule known as the ejusdem generis rule shall not apply
and, accordingly, general words introduced by the word "other"
shall not be given a restrictive meaning by reason of the fact
that they are preceded by words indicating a particular class
of acts, matters or things; and
(b) general words shall not be given a restrictive meaning by
reason of the fact that they are followed by particular
examples intended to be embraced by the general words.
2. CALL OPTION
2.01 In consideration of payment by Mr. Hong of HK$1.00 to Huachen, Huachen
hereby irrevocably grants to Mr. Hong the right to purchase all or part
of the Option Shares at any time during the Option Period (the "CALL
OPTION"). Upon the expiry of such Option Period, the Call Option shall
lapse if not previously exercised.
2.02 The Call Option shall be exercised by Mr. Hong serving on Huachen
written notice (the "CALL OPTION NOTICE") of his wish to exercise the
same. The Call Option Notice shall specify the number of Shares in
respect of which the option is exercised and shall not be revocable by
Mr. Hong otherwise than with the consent in writing of Huachen.
2.03 The price at which such purchase shall take place pursuant to the Call
Option shall be HK$0.95 per Share (the "EXERCISE PRICE").
2.04 Completion of the purchase pursuant to a Call Option Notice shall take
place on the date falling 2 days after the date of receipt by Huachen
of the relevant Call Option Notice from Mr. Hong (or such other date as
the Parties may agree in writing) (the "OPTION COMPLETION DATE") at the
offices of Xxxxx & XxXxxxxx at 00xx Xxxxx, Xxxxxxxxx Xxxxx, 00 Xxxxxxxx
Xxxx, Xxxx Xxxx (or at such other place as the Parties may agree in
writing) when all (but not some) of the matters contained in this
Clause 2.04 shall occur:
(a) Mr. Hong shall pay to Huachen:
(i) the amount obtained by multiplying the number of
Shares in respect of which the option is exercised
(as specified in the Call Option Notice)
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(the "RELEVANT Shares") by the Exercise Price (the
"RELEVANT SUM"); or
(ii) if he so elects, 10% of the Relevant Sum; and
(b) Huachen shall, subject to compliance by Mr. Hong of his
obligation under Clause 2.04(a), deliver to Mr. Hong duly
executed instruments of transfer and sold notes in respect of
the Relevant Shares in favour of Mr. Hong accompanied by the
relevant share certificate(s).
3. FURTHER OBLIGATIONS OF THE PARTIES
3.01 In the event that Mr. Hong elects to pay 10% of the Relevant Sum as
contemplated in Clause 2.04(a)(ii), he shall:
(a) pay to Huachen 90% of the Relevant Sum (the "BALANCE") on or
before the day falling 3 years after the Option Completion
Date; and
(b) forthwith on the Option Completion Date:
(i) mortgage, charge and assign the Relevant Shares to
Huachen as a continuing security for the due and
punctual payment of Balance pursuant to the terms of
this Deed; and
(ii) deliver to Huachen, as security for the performance
of his payment obligation under Clause 3.01(a), the
share certificate(s) for the Relevant Shares.
3.02 Huachen shall, upon receipt of the Balance or any part thereof from Mr.
Hong in satisfaction of all or part of his obligations under Clause
3.01(a), as soon as reasonably practicable and at Mr. Hong's cost,
release to Mr. Hong certificate(s) for such number of Shares as is
calculated in accordance with the following formula, which he
previously delivered to Huachen pursuant to Clause 3.01(b)(ii) above
and which were held by Huachen as security for performance by Mr. Hong
of his obligation under Clause 3.01(a):
Amount received by Huachen from Mr. Hong on the relevant occasion
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Exercise Price x (0.9)
Upon payment of the Balance in full by Mr. Hong pursuant to Clause
3.01(a), Huachen shall, as soon as reasonably practicable and at Mr.
Hong's cost, release to Mr. Hong any share certificate(s) for any of
the Relevant Shares (if any) which:
(a) Mr. Hong previously delivered to Huachen pursuant to Clause
3.01(b)(ii) above and which were held by Huachen as security
for performance by Mr. Hong of his obligation under Clause
3.01(a); and
(b) have not been released to the Mr. Hong (whether pursuant to
this Clause 3.02 or otherwise).
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3.03 Mr. Hong agrees that, at any time after the occurrence of the Event of
Default, Huachen may:
(a) at the cost of Mr. Hong, register such part of the Relevant
Shares which are represented by share certificate(s) which
remain in the possession of Huachen in the name of Huachen or
its nominee; or
(b) if Huachen in its absolute discretion so elects, sell or
dispose of all or any part of the Relevant Shares which are
represented by share certificate(s) which remain in the
possession of Huachen.
In addition, and without limiting the generality of the foregoing, at
any time after the occurrence of the Event of Default, Mr. Hong
undertakes, forthwith upon Huachen's request, to do and execute or
procure to be done and executed all such further acts, deeds,
transfers, powers of attorney, proxies and other documents and things
which Huachen may require for perfecting Huachen's title to any of the
Relevant Shares which are represented by share certificate(s) which
remain in the possession of Huachen or for vesting or enabling it to
vest the same in itself, its nominee or in any purchaser.
3.04 Mr. Hong undertakes and agrees with Huachen that, so long as the
Balance or any part thereof remains owing and unless Huachen otherwise
agrees in writing:
(a) he will not create or attempt or agree to create or permit to
arise or exist any encumbrance over all or any part of the
Relevant Shares which are represented by share certificate(s)
which remain in the possession of Huachen or any interest
therein or otherwise assign, deal with or dispose of all or
any part of the Relevant Shares which are represented by share
certificate(s) which remain in the possession of Huachen
(except under or pursuant to this Deed);
(b) he will not grant in favour of any other person any interest
in or any option or other rights in respect of any part of the
Relevant Shares which are represented by share certificate(s)
which remain in the possession of Huachen;
(c) he will at all times remain the legal and beneficial owner of
such part of the Relevant Shares which are represented by
share certificate(s) which remain in the possession of
Huachen; and
(d) he will not do or cause or permit to be done anything which
may in any way depreciate, jeopardise or otherwise prejudice
the value of Huachen's security created pursuant to Clause
3.01(b)(i).
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4. RESTRICTION ON ANNOUNCEMENTS
Mr. Hong undertakes that as from the date of this Deed he will not
(save as required by law, any regulatory requirement, The Stock
Exchange of Hong Kong Limited, the Securities and Futures Commission of
Hong Kong or any rule of any relevant stock exchange) make any
announcement in connection with this Deed or the transactions or
arrangements contemplated hereunder or referred to herein unless
Huachen shall have given its consent to such announcement (which
consent may not be unreasonably withheld and may be given either
generally or in a specific case or cases and may be subject to
conditions).
5. GENERAL
5.01 Each notice, demand or other communication given or made under this
Deed shall be in writing and delivered or sent to the relevant Party at
its address stated at the beginning of this Deed (or such other address
as the addressee has by 5 days' prior written notice specified to the
other Party).
5.02 This Deed constitutes the whole agreement between the Parties and
supersedes any previous agreements or arrangements between them
relating to the subject matter hereof; it is expressly declared that no
variations hereof shall be effective unless made in writing signed by
the Parties or duly authorised representatives of the Parties.
5.03 All of the provisions of this Deed shall remain in full force and
effect notwithstanding completion of the purchase of Shares pursuant to
the Call Option Notice to which such Shares relate in accordance with
Clause 2.04 (except insofar as they set out obligations which have been
fully performed on the relevant Option Completion Date).
5.04 If any provision or part of a provision of this Deed or its application
to any Party shall be, or be found by any authority or court of
competent jurisdiction to be, invalid or unenforceable, such invalidity
or unenforceability shall not affect the other provisions or parts of
such provisions of this Deed, all of which shall remain in full force
and effect.
5.05 No failure or delay by Huachen in exercising any right, power or remedy
under this Deed shall operate as a waiver thereof, nor shall any single
or partial exercise of the same preclude any further exercise thereof
or the exercise of any other right, power or remedy. Without limiting
the foregoing, no waiver by Huachen of any breach of any provision
hereof shall be deemed to be a waiver of any subsequent breach of that
or any other provision hereof.
5.06 This Deed may be executed in one or more counterparts, and by the
Parties on separate counterparts, but shall not be effective until each
Party has executed at least one counterpart and each such counterpart
shall constitute an original of this Deed but all the counterparts
shall together constitute one and the same instrument.
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5.07 This Deed has been executed in the English language and the Chinese
language. In the event of any inconsistency between the English
language version and the Chinese language version, the English language
version shall prevail.
6. GOVERNING LAW AND SUBMISSION TO JURISDICTION
6.01 This Deed shall be governed by and construed in accordance with the
laws of Hong Kong and the Parties hereby irrevocably submit to the
non-exclusive jurisdiction of the Hong Kong courts.
6.02 Huachen hereby irrevocably appoints Xx. Xx Xiao An (also known as Xx
Xxx On) of Suites 2303 - 2306, 23rd Floor, Great Xxxxx Xxxxxx, 00
Xxxxxxx Xxxx, Xxxxxxx, Xxxx Xxxx as its agent to receive and
acknowledge on its behalf service of any writ, summons, order, judgment
or other notice of legal process in Hong Kong. If for any reason the
agent named above (or its successor) refuses to serve or no longer
serves as agent of Huachen for this purpose, Huachen shall promptly
appoint a successor agent, notify Mr. Hong thereof and deliver to Mr.
Hong a copy of the new process agent's acceptance of appointment,
provided that until Mr. Hong receives such notification, he shall be
entitled to treat the agent named above (or its said successor) as the
agent of Huachen for the purposes of this Clause 6.02. Huachen agrees
that any such legal process shall be sufficiently served on it if
delivered to such agent for service at its address for the time being
in Hong Kong whether or not such agent gives notice thereof to it.
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IN WITNESS WHEREOF the parties hereto have executed this document as a deed on
the date appearing at the head hereof.
SIGNED, SEALED AND DELIVERED )
by HONG XING ) SEAL /s/ Hong Xing
) -------------
in the presence of: )
/s/ Xxxx Xxx
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THE COMMON SEAL of )
[NAME IN CHINESE] )
(HUACHEN AUTOMOTIVE GROUP HOLDINGS )
COMPANY LIMITED) ) SEAL /s/ Xxxx Xxx Shan
was hereunto affixed in the presence of: ) -----------------
/s/ Zhu Xxx Xxxx )
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