Stock Purchase Agreement
Exhibit
10.4
Parties:
Party
A:
Jinzhou Wonder Industry (Group) Co., Ltd (“Wonder Group”)
Party
B:
Wonder Auto Limited (“Wonder Ltd.”)
April
28,
2004 in Beijing
RECITALS:
WHEREAS,
Jinzhou Halla Electrical Xx.Xxx.( “Halla”) is a joint-venture enterprise
established in compliance with the Chinese laws;
WHEREAS,
Wonder Group owns 61% of Halla’s stock at the execution of this
agreement.
WHEREAS,
Wonder Ltd. is a British Virgin Islands corporation.
WHEREAS,
Wonder Ltd. shall acquire all of the Halla’s stock owned by Wonder Group in
exchange for RMB 67,100,000.
NOW,
THEREFORE, the Parties intended to be legally bound, hereby agree as
follows.
1. Definition:
Halla:
Jinzhou
Halla Electrical Co. Ltd.
Transfer
Consideration: as defined in Section 3.2
2. Basic
Transaction:
2.1
Wonder Ltd. agrees to acquire from Wonder Group 61% of issued and outstanding
stock of Halla, including all the future interest derived from the shares.
The
transferred shares shall be clear and free of any encumbrance or restrictions
on
transfer.
2.2
Since
Halla intends to complete its distribution of profits, which are realized in
the
duration of year 2002 and from January to July of 2003, to its shareholders,
the
transaction does not affect any rights and benefits on the part of the
shareholders resulting from the aforementioned distribution.
2.3
After
the consummation of the transfer, Wonder Ltd. will own 60% of issued and
outstanding stock of Halla.
3. Price
and Payment Arrangement
1
3.1
Both
parties agree to determine the purchase price based on Halla’s net asset at the
date of July 31, 2003, which is estimated to be RMB1,687,000,000, audited by
an
accounting firm.
3.2
The
purchase price shall be RMB67,100,000, not including the undistributed profits
realized in the period defined in Article. 2.2.
3.3
Manners of Payment: payment shall be made by Party B’s parent company— Empower
Century Limited within 60 days after the closing.
4. Conditions
to Closing
4.1
Both
parties agree that the transfer becomes effective at the closing
date.
| i. |
Both
parties have full power and authority to execute and deliver this
agreement and to perform its obligations hereunder.
|
| ii. |
The
execution of the agreement and the transfer of the stock has been duly
authorized by all requisite corporation action of Party
A.
|
| iii. |
The
execution of the agreement and the transfer of the stock has been duly
authorized by all requisite corporation action of Party
B.
|
| iv. |
The
execution of the agreement and the transfer of the stock has been duly
authorized by board of directors of Party A and shareholders of Party
A
agree to waive their right of first refusal regarding the transferred
stock.
|
| v. |
The
transfer
of the stock has been approved by the Jinzhou Bureau of International
Trade, and Halla is approved by the Bureau to conduct international
trade
with foreign investors.
|
4.2
If
the conditions set forth in Article 4.1 are not satisfied at the closing date,
Party B can terminate the contract with written notice delivered to Party A.
4.3
If
the agreement is terminated pursuant to Article 4.2, the parties agree as
follows:
| i. |
All
obligations and duties, except those regarding confidentiality, are
discharged upon the termination of the agreement.
|
| ii. |
Both
parties shall extend effort in good faith to restore the other party
to
the original state before the closing.
|
| iii. |
Each
party shall bear its own cost incurred before the closing regarding
this
transaction.
|
2
| iv. |
If
the failure of the condition is caused by breach of contract on the
part
of one party, the other party reserves all his rights to legal remedies.
|
5. Closing
5.1
Both
parties agree to duly fulfill all the obligations set forth in this agreement.
5.2
If
Party A breaches Article 5.1, Party B can at its options continue its
performance under the agreement and Party A shall compensate all the damages
suffered by Party A and caused by Party B’s breaches.
6. Presentations
and Warranties of Party A
6.1
All
information furnished by Party A regarding this agreement is true and accurate.
6.2
Party
A shall compensate all the damages caused by its misrepresentation to Party
B.
6.3
Each
warranty set forth herein is consistent with each other.
6.4
Any
action or investigation in the course of due diligence on the part of Party
B
shall not affect its right to legal remedies for the damages caused by Party
A’s
misrepresentation, unless Party B executes release documents that are authorized
by Party B’s requisite corporation actions.
6.5
If
Party A breaches any obligations under this agreement before the execution
of
this agreement, Party B can terminate the agreement with written notice.
6.6
Party
A shall obtain all the required governmental or other consent and duly conduct
the relevant filings to relevant authorities.
7. Warranties
and Representations of Party B
7.1
Party
B is duly formed and in good standing under the laws of British Virginia
Islands.
8. Additional
Warranties and Representations of Party A
8.1
Party
A shall fulfill its obligations regarding the execution and performance of
the
agreement and the underlying transaction is clear and free of any encumbrance
or
obligations on the part of Party A owed to any third parties.
9. Disclosure
and Assistance of Party B’s due diligence.
10. Force
majeure
3
If
the
failure to comply with the agreeement is caused by interventing force not
attrituble to any party, both parties can terminate the contract with written
notice delivered to the other party.
11. Confidentiality
11.1
Both
parties shall treat and hold as confidential all of the information in
connection with this agreement.
11.2
Both
parties shall refrain from any public comments regarding this transaction
without the other party’s written consent.
11.3
All
the obligations defined in this provision shall survive the closing
herein.
12. Remidies
for Breaches of This Agreeement
12.1
Any
posponed actions or undertaking of remedial measures on the part of one party
after the breach on the part of the other party shall not affect the
non-breaching party’s right to any entitled legal remedies.
12.1
If
any provision was determined as illegal, void or unenforceable pursuant to
regulations in any relevant jurisdiction, other provisions shall continue in
full force and effect.
13. Tax
Matters:
Parties
shall pay taxes resulted from this transaction, if any, as required by the
applicable law..
14. Liabilities
for Breaches of This Agreement
14.1
Breaching party shall be responsible for any loss or damages caused by its
breaches of this agreement.
15. Termination
and Modifications of the Agreement
15.1
Any
change to this Agreement shall not be effietive without both partie’s written
consent.
15.2
This
agreement may be terminated in the following situations:
| i. |
With
both parties’ written consent
|
| ii. |
The
agreement is void by govermental action or demand that is final and
conclusive.
|
| iii. |
Any
material breach not corrected by the breaching party within 30 days
of the
written notice issued by the non-breaching
party.
|
4
15.3
If
this agreement is terminated by the non-breaching party, in absence of fraud
or
breaches set forth in Article 16.2 on the part of the non-breaching party,
all
obligations on the part of the non-breaching party shall be hereby released.
16. Disbute
Resolution
16.2
This
Agreement is governed by laws of the People’s Republic of China. Any laws or
regulation enacted after the execution of this agreement shall not have
retroactive effects on this agreement.
16.3
Any
dispute arisng from this agreement shall be first resolved by negotiation
between both parties. If the dispute is not resolved in 60 days after the
dispute is raised, either party can resort to the court sitting in the
jurisdiction where this agreement is executed.
Jinzhou
Wonder Group.
/s/
Xxxxxxx Xxxx
Wonder
limited
/s/
Xxxxx Xxxxx
5
