BUSINESS OPERATION AGREEMENT
This
Agreement is made on the 26th day of
November, 2008, at Shijiazhuang, People’s Republic of China (the “PRC”) by and
among the following parties:
Hebei
Xxxxxx Xxxx Trade Co., Ltd. ( “Party A”)
Registered
Address: 000 Xxxx Xxxxxxxxx Xxxx, Shijiazhuang
Legal
representative: Zhang Zhongwen
Hebei Hua
An Investment Co., Ltd. (“Party
B”)
Registered
Address: 000 Xxxx Xxxxxxxxx Xxxx, Xxxxxxxxxxxx
Legal
representative: Guo Zhongqi
WHEREAS:
1.
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Party
A, a wholly foreign owned enterprise organized and existing under the laws
of PRC. (For the purpose of this Agreement, excluded Hong Kong Special
Administrative Region, Macau Special Administrative Region and Taiwan
hereinafter the “PRC”)
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2.
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Party
B, a limited liability company registered and existing under the laws of
PRC.
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3.
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Party
A and Party B have agreed that, under the law of the PRC, Party B shall
assign the equity interests of 【22】4S Stores(
hereinafter “companies”) hold by him to Party A or any third party
designated by Party A unconditionally. So the ordinary course of business
will materially impact the interest of Party A after the acquisition of
equity interest of Party B
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NOW THEREFORE, through mutual
consultations, the Parties have reached the following
agreement:
1.
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OBLIGATION
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For the
purpose of guarantee the Agreements and obligations, Party B hereby acknowledges
and agrees that, other than with prior written consent of Party A or the third
party designated by Party A, Party B will not undertake or urge the Company to
undertake any transactions which may material impact the assets, obligations,
rights or business of the company, including but not limited:
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1.1
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It
will not undertake any business beyond the ordinary scope of
business;
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1.2
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It
will not lend any loan to third party or assume any indebtedness from any
third party;
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1
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1.3
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It
will not change or remove any directors or senior management
team.
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1.4
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It
will not sell or acquire any assets or rights exceed RMB 100,000 in value
to any third party, include but not limited to any intellectual
properties;
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1.5
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It
will not provide any of its assets or intellectual properties to be used
as securities or provide any other encumbrance
thereon;
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1.6
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It
will not modify the articles of association and bylaws of the Company or
alter the scope of business of the
Company;
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1.7
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It
will not alter the operation procedure or substantially modifying the
internal system;
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1.8
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It
will not transfer the rights and obligations hereunder to any third
party.
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Party A
has the right to inspect the business status of Company at any time and ask
Party B for assistance, including but not limited to provide the documents which
Party A believes is necessary and to answer the questions raised by Party A. In
the event that the conduct(s) of Party B or the Company lead the Party A
reasonably believes that it had violated the obligation provided in the Section
1 under this Agreement, Party A is entitled to require Party B to withdraw such
conduct(s), and Party B shall cause the Company to withdraw such conduct(s) (if
possible).
2.
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BUSINESS
OPERATION AND PERSONNEL ARRANGEMENT
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2.1 |
Party
B agrees to cause the Company to accept and enforce rigidly the advices in
connection with the appointment and dismissal of employees, the daily
business operation of the Company and the financing management systems of
the Company.
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2.2
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Party
B hereby agrees that, it will cause the Company to appoint the persons
designated by Party A to assume the position of director in accordance
with the procedure provided by laws, regulations and articles of
association, and cause such directors to elect the chairman of the board
according to the instruction by Party A. Party B shall appoint the
personnel designated by Party A as the Company’s general manager,
financial controller and other
officers
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2.3
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The
aforesaid director or officers designated by Party A shall loss all the
position in the Company in the event of dismissal (voluntarily or
involuntarily) or resignation from Party A. Party B shall cause the
Company to appoint other person designated by Party A to assume such
position under this circumstance.
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2.4
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For
the purpose of said Section 2.3, Party B will urge the Company to take any
and all necessary steps to accomplish the appointment and dismissal
procedure under the applicable law, regulations and articles of
association of the Company and provisions specified in this
Agreement.
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2
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2.5
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Simultaneously
with the execution of this Agreement, party B agrees to execute the Power
of Attorney (“POA”), appointing Party A’s authorized representatives as
his/her attorney with the power to vote at any meetings or in any other
circumstance, Party B further agrees to execute and deliver a new POA to
the effect of withdrawing the authorization with respect to the
representative of the Attorney in the POA and nominate the new
representative as the attorney on request of Party
A.
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3.
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MISCELLANEOUS
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3.1
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In
the event of expiration or termination of any one of the agreements
between the Parties, Party A is entitled to determine whether to terminate
all other agreements between the
Parties.
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3.2
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Party
B agrees, it will pay or transfer unconditionally to Party A any or all
bonus, dividends or any other revenues or benefits (no matter the form)
which it obtained from the Company as the shareholder. The taxes and
expenses regard with the transfer (if any) shall be assumed according to
the applicable laws.
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4.
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BREACH
OF CONTRACT
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4.1
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Unless
otherwise specified hereunder, in the event that Party B fails to perform
this Agreement fully and completely or terminate its performance
temporarily, and fails to correct his non-performance within 30 days after
the acceptance of Party A’s notice, it will be deemed as the breach of
contract.
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4.2
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Any
expenses (including but not limited to attorney fees, litigation fees,
arbitration fees and travel and lodging fees), responsibilities or damages
(including but not limited to reasonable loss of profit) undertaken by
Party A arising in connection with the non-performance of Party B shall be
indemnified by Party B.
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5.
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ENTIRE
AGREEMENT AND AMENDMENT
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5.1
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This
Agreement and any other contract mentioned or included expressly by the
Agreement constitute the entire the subject matter between the Parties
hereto, and supersedes all prior agreements, contracts, understandings and
communications.
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5.2
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No
amendment, supplementary or modification of this Agreement shall occur
except in writing. The amend agreement and supplementary agreement that
have been signed by the Parties shall have the same validity as this
Agreement.
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3
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6.
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GOVERNING
LAW
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The
execution, effectiveness, performance, construction and settlement of dispute of
this Agreement shall be governed by the laws of the PRC.
7.
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SETTLEMENT
OF DISPUTE
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7.1
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In
the event of any dispute with respect to or in connection with the
construction and performance of the provisions of this Agreement, the
Parties shall first negotiate in good faith to resolve the dispute. In the
event the Parties fail to reach an agreement on the resolution of such a
dispute, any Party may submit the relevant dispute to China International
Economic and Trade Arbitration Commission in Shijiazhuang for binding
arbitration. The languages used during arbitration shall be Chinese. The
arbitration shall be final and binding on both
Parties.
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7.2
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The
Parties shall in good faith in all other respects continue their
implementation of this Agreement except issues in dispute between the
Parties.
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8.
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NOTICES
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All
notices and other communications given or made pursuant hereto shall be in
writing and deliverer to the address as specified below by personally delivery,
registered mail pre-paid post, courier or facsimile transmission.
Party A:
Hebei Xxxxxx Xxxx Trade Co., Ltd.
Address:
000 Xxxx Xxxxxxxxx Xxxx, Xxxxxxxxxxxx
Facsimile:
0000-00000000
Telephone:
0000-00000000
Attention:
Zhang Zhongwen
Party B:
Hebei Hua An Investment Co., Ltd.
Address:
000 Xxxx Xxxxxxxxx Xxxx, Shijiazhuang
Facsimile:
0311-85068891Telephone: 0311-85068889
Attention:
Guo Zhongqi
9.
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EFFECTIVENESS,
TERMIN ATION AND MISCELLANEOUS
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9.1
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This
Agreement shall expire in 10 years following the date first above written
unless terminated earlier in accordance with the provisions specified in
this Agreement. The term of this
Agreement will be automatically extended for another ten-year period upon
expiry, unless Party A filed a 3 months’ prior written notice before the
expiration of the Agreement.
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9.2
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This
Agreement shall not be terminated by Party B during the term but Party A
can terminate this Agreement at any time without cause, by giving 30 day's
prior written notice to Party
B.
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4
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9.3
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If
any term or provision of this Agreement is determined to be invalid,
illegal or incapable of being enforced by any applicable laws and
regulations, all other conditions and provisions of this Agreement will
nevertheless remain in full force and effect. Upon such determination that
any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto will negotiate in good faith to modify this
Agreement so as to effect the original intent of the Parties as closely as
possible to the fullest extent permitted by applicable law in an
acceptable manner to the end that the transactions contemplated hereby are
fulfilled to the extent possible.
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9.4
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No
delay or omission by any Party in exercising the right, power or privilege
hereunder shall be deemed as a waiver of such right, power or privilege.
The single or partial exercise of any right, power or privilege shall not
preclude any exercise of any other right, power or
privilege.
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IN WITNESS WHEREOF, the
parties have duly executed this Agreement as of the date first written
above.
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[SIGNATURE
PAGE]
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Party
A: Hebei Xxxxxx Xxxx Trade Co., Ltd.(seal)
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Authorized
Representative(signature):
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Party
B: Hebei Hua An Investment Co., Ltd(seal)
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Authorized
Representative(signature):
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