Exhibit 10.8
LOAN AGREEMENT
The Loan Agreement (the "Agreement") is entered into as of October 27, 2006
between the following two parties:
(1) ATA Testing Authority (Holdings) Limited (the "Lender"), a limited
liability company established and registered in the British Virgin Islands
("BVI").
(2) Xxxx Xxx (the "Borrower")
PRC ID NUMBER: 000000000000000000
ADDRESS: Xxxx 0, Xxxxxxxx 0, 00 Xxx Xxxx Wo Road, Haidian District,
Beijing, PRC.
Lender and Borrower will each be referred to as a "Party" and collectively
referred to as the "Parties."
WHEREAS, Borrower, together with other individuals, intends to establish a
limited liability company with the company name of "(CHINESE CHARACTERS)" in
Beijing, People's Republic of China ("PRC") to operating ICP related test
preparation business("ICP Company") and hold 5% of the equity of ICP Company.
WHEREAS, Borrower wishes to borrow a loan from Lender to finance its
investment in ICP Company and Lender agrees to provide such loan to Borrower.
NOW THEREFORE, the Parties agree as follows:
1. LOAN
1.1 Lender agrees to provide a loan to Borrower with the principal amount equal
to the US Dollar equivalent of RMB 50,000 in accordance with the terms and
conditions set forth herein (the "Loan"). Term for such loan shall be ten
(10) years which may be extended upon the agreement of the Parties (the
"Term"). Notwithstanding the foregoing, in the following circumstances,
Borrower shall repay the Loan regardless if the Term has expired:
(1) Borrower deceases or becomes a person without legal capacity or with
limited legal capacity;
(2) Borrower commits a crime or is involved in a criminal act; or
(3) Lender or its designated assignee can legally purchase Borrower's
interest in ICP Company under the PRC law and Lender chooses to do so.
1.2 Lender shall remit the amount of the Loan to an account designated by
Borrower within seven (7) days after receiving Borrower's disbursement
notice in writing, provided that all of the conditions precedent to
disbursement set forth in Section 2 of this Agreement have been fully
satisfied. Borrower shall deliver a written confirmation to Lender within
one (1) day after receiving the amount of the Loan.
1.3 The Loan shall only be used by Borrower to invest in ICP Company's
registered capital. Without Lender's prior written consent, Borrower shall
not use the Loan for any other purpose or transfer or pledge his interest
in ICP Company to any third party.
1.4 Borrower can only repay the Loan by transferring all of his interest in ICP
Company to Lender or a third party designated by Lender when such transfer
is permitted under the PRC law.
1.5 In the event (1) Borrower transfers his interest to the Lender or a third
party transferee designated by Lender to the extent permitted by applicable
PRC laws or (2) Borrower receives any dividends from ICP Company, Borrower
shall pay the full amount of the proceeds it receives from such transfer or
from such dividends to Lender regardless if the amount of such proceeds
exceeds or is less than the amount of the Loan.
1.6 Lender and Borrower hereby jointly agree and confirm that Lender has the
right to, but has no obligation to, purchase or designate a third party
(legal person or natural person) to purchase all or part of Borrower's
interest in ICP Company at a price equal to the amount of the Loan (or at
the lowest price permitted by applicable PRC laws if the foregoing
determined price is not permitted in accordance with applicable PRC laws)
when such purchase is allowed under the PRC law. If Lender or the third
party assignee designated by Lender only purchases part of Borrower's
interest in ICP Company, the purchase price shall be reduced on a pro rata
basis.
1.7 In the event when Borrower transfers his interest in ICP Company to Lender
or a third party transferee designated by Lender, (i) if the amount of (1)
the actual transfer price paid by Lender or the third party transferee and
(2) the dividends (if any) received by Borrower from ICP Company equals or
is less than the principal amount of the Loan, to the extent permitted by
the applicable PRC laws, the Loan shall be deemed as interest free; or (ii)
if the amount of (1) the actual transfer price paid by Lender or the third
party transferee and (2) the dividends (if any) received by Borrower from
ICP Company is higher than the principal amount of the Loan, the amount
exceeding the principal amount of the Loan shall be deemed as an interest
accrued on the Loan and paid by Borrower to Lender in full.
2. CONDITIONS PRECEDENT TO DISBURSEMENT
The following conditions must be satisfied before the Loan is disbursed to
Borrower:
2.1 Subject to the terms of Section 1.2, Lender has received the written
disbursement notice from Borrower.
2.2 The representation and warranties under Section 3 remain true and correct
on the day when the disbursement notice is delivered to Lender and on the
date the Loan is disbursed to Borrower as if such representations and
warranties are made as of such dates.
2.3 Borrower has not materially breached any terms or conditions hereof.
3. REPRESENTATION AND WARRANTIES
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3.1 Lender hereby represents and warrants to Borrower that:
(a) Lender is a company registered and validly existing under the laws of
BVI;
(b) subject to its Memorandum and Articles of Association and other
organizational documents, Lender has full right, power and all
necessary approvals and authorizations to execute and perform this
Agreement;
(c) the execution and the performance of this Agreement will not
contravene any provision of law applicable to Lender or any
contractual restriction binding on or affecting it; and
(d) this Agreement shall constitute the legal, valid and binding
obligations of Lender, which is enforceable against Lender in
accordance with its terms upon its execution.
3.2 Borrower hereby represents and warrants to Lender that:
(a) Borrower has full right, power and all necessary and appropriate
approval and authorization to execute and perform this Agreement;
(b) the execution and the performance of this Agreement will not
contravene any provision of law applicable to Borrower or any
contractual restriction binding on or affecting Borrower;
(c) this Agreement shall constitute the legal and valid obligations of
Borrower, which is enforceable against Borrower in accordance with its
terms upon its execution; and
(d) there are no legal or other proceedings before any court, tribunal or
other regulatory authority pending or threatened against Borrower.
4. OBLIGATIONS AFTER DISBURSEMENT
4.1 Upon the establishment of ICP Company, Borrower shall formally execute an
equity pledge agreement (the "Equity Pledge Agreement") with Lender's
wholly owned subsidiary as designated by Lender ("ATA (Beijing)"), under
which Borrower agrees to pledge all his interest in ICP Company to ATA
(Beijing).
4.2 Upon the establishment of ICP Company, Borrower shall execute and cause ICP
Company to execute as well a call option and cooperation agreement (the
"Call option Agreement") with Lender and/or ATA (Beijing), according to
which Borrower grants Lender and/or ATA (Beijing) an irrevocable option to
purchase all of his interest in ICP Company when certain conditions
provided in the agreement are met.
5. NOTIFICATIONS
Notice or other communications under this Agreement shall be delivered
personally or sent by facsimile transmission or by registered mail to the
address set forth below, except that such address has been changed in
writing. The date noted on the return
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receipt of the registered mail is the service date of the notice if the
notice is sent by registered mail; the sending date is the service date of
the notice if the notice is sent personally or by facsimile transmission.
The original of the notice shall be sent personally or by registered mail
to the following address after the notice is sent by facsimile.
Lender: ATA Testing Authority (Holdings) Limited
Address: 0xx Xxxxx, Xxxx Xxxxx
0 Xxxxxxxx Xxxx Xxxxxx
Jianguomen Nei
Beijing 100005, China
Borrower: Xxxx Xxx
Address: 0xx Xxxxx, Xxxx Xxxxx
0 Xxxxxxxx Xxxx Xxxxxx
Jianguomen Nei
Beijing 100005, China
6. CONFIDENTIALITY
The Parties acknowledge and confirm that any oral or written materials
concerning this Agreement exchanged between them are confidential
information. The Parties shall protect and maintain the confidentiality of
all such confidential data and information and shall not disclose to any
third party without the other party's written consent, except (a) the data
or information that was in the public domain or later becomes published or
generally known to the public, provided that it is not released by the
receiving party, (b) the data or information that shall be disclosed
pursuant to applicable laws or regulations, and (c) the data or information
that shall be disclosed to One Party's legal counsel or financial counsel
who shall also bear the obligation of maintaining the confidentiality
similar to the obligations hereof. The undue disclosing of the confidential
data or information of One Party's legal counsel or financial counsel shall
be deemed the undue disclosing of such party who shall take on the
liability of breach of this Agreement.
7. GOVERNING LAW AND SETTLEMENT OF DISPUTES
7.1 The execution, validity, interpretation, performance, implementation,
termination and settlement of disputes of this Agreement shall be governed
by the laws of Hong Kong, SAR.
7.2 In event of any dispute arising from or in connection with this Agreement,
the Parties shall attempt to resolve the dispute through friendly
consultations. In the event that satisfactory resolution is not reached
within thirty (30) days after commencement of such consultation, the
dispute shall be submitted (which submission may be made by either Borrower
or Lender) to resolution by arbitration administered by Hong Kong
International Arbitration Center (the "Center") in Beijing, China, in
accordance with the procedural rules of the Center, which are in effect at
the time the application for
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arbitration is made. The arbitral award shall be final and binding upon all
parties hereto.
8. MISCELLANEOUS
8.1 This Agreement can only be amended by written agreements jointly executed
by the parties. Lender may freely and at its sole discretion assign any of
its rights and delegate any of its responsibilities under this Agreement to
a third party.
8.2 Any provision of this Agreement that is invalid or unenforceable shall not
affect the validity and enforceability of any other provisions hereof.
8.3 This Agreement shall substitute and replace in full the Loan Agreement
dated May 19 2006 between the Lender and the Borrower.
(THE FOLLOWING SPACE IS INTENTIONALLY LEFT BLANK)
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IN WITNESS WHEREOF, the Parties have duly executed this Agreement, or have
caused this Agreement to be duly executed on their behalf, as of the date first
hereinabove set forth.
LENDER:
ATA TESTING AUTHORITY (HOLDINGS) LIMITED
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By:
Title:
BORROWER:
XXXX XXX
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