EXCLUSIVE OPTION AGREEMENT AMONG SHAANXI BIOSTAR BIOTECH LTD AND THE FOURTEEN PERSONS INCLUDING WANG RONGHUA SHAANXI AOXING PHARMACEUTICAL CO., LTD. 【】July, 2007 XIANYANG, CHINA
AMONG
SHAANXI
BIOSTAR BIOTECH LTD
AND
THE
FOURTEEN PERSONS INCLUDING XXXX XXXXXXX
SHAANXI
AOXING PHARMACEUTICAL CO.,
LTD.
【】July,
2007
XIANYANG,
CHINA
This
Exclusive Option Agreement (the “Agreement”) is entered into as of 【】July,
2007 between the following parties in Xianyang.
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Party
A:
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Shaanxi
Biostar Biotech Ltd
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Registered
Address: 3rd floor, backyard of Industrial and Business Bureau, Shiji
Avenue, Xianyang.
Legal
Representative:
Xxxx Xxx
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Party
B:
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1.
Xxxx
Xxxxxxx, a citizen of PRC with ID Card number【●】
2.
Xxxx
Xxx, a citizen of PRC with ID Card number 【●】
3.
Xxxx
Xxxxxx, a citizen of PRC with ID Card number 【●】
4.
Wang
Rangmei, a citizen of PRC with ID Card number 【●】
5.
Xxx
Xxxxxx, a citizen of PRC with ID Card number 【●】
6.
Xxxx
Xxxxxx, a citizen of PRC with ID Card number 【●】,
7.
An
Xiaoru, a citizen of PRC with ID Card number 【●】
8.
Ao
Quanfang, a citizen of PRC with ID Card number 【●】
9.
Xxxx
Xxxxxxx, a citizen of PRC with ID Card number 【●】
10.
Qin Hongxia, a citizen of PRC with ID Card number 【●】
11.
Xx Xxxx, a citizen of PRC with ID Card number 【●】
12.
Xx Xxxxxxx, a citizen of PRC with ID Card number 【●】
13.
Bai Rong, a citizen of PRC with ID Card number 【●】
14.
Xx Xxx, a citizen of PRC with ID Card number 【●】
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1
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Party
C:
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Shaanxi
Aoxing Pharmaceutical Co., Ltd
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Registered
Address: Chenyangzhai, Xianyang
Legal
Representative: Xxxx
Xxxxxxx
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In
this
Agreement, Party A, Party B and Party C are called collectively as the “Parties”
and each of them is called as the “Party”.
WHEREAS:
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1.
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Party
A is a wholly foreign-owned enterprise incorporated under the laws
of the
People’s Republic of China (the “PRC”);
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2.
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Party
C is a limited liability company incorporated in Xianyang and with
business license issued by the Xianyang Municipal Administration
for
Industry and Commerce;
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3.
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As
of the date of this Agreement Party B are shareholders of Shaanxi
Aoxing
Pharmaceutical Co., Ltd (hereinafter referred to as “Shaanxi Aoxing”) and
collectively legally hold all of the equity interest of Shaanxi Aoxing.
Under this Agreement, Party B, The Fourteen Persons including Xxxx
Xxxxxxx
have acted collectively as one party to this
Agreement;
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NOW,
THEREFORE,
the
Parties through mutual negotiations hereby enter into this Agreement according
to the following terms and conditions:
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1.
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THE
GRANT AND EXERCISE OF PURCHASE
OPTION
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Grant:
Party B hereby grant Party A an irrevocable exclusive purchase option. Party
A
has right to purchase all or part of the shares of Party C currently owned
by
any of Party B, or to purchase all or part of the assets of Party C, in each
case in accordance with Article 1.3 of this contract. This purchase option
is
irrevocable and shall be exercised only by Party A (or the qualified persons
appointed by Party A). The term “person” used herein shall include any entity,
corporation, partnership, joint venture and non-corporate organizations.
2
Exercise
Procedures:
Party
A
shall notify Parties B in writing prior to exercising its option (the “Option
Notice” hereinafter).
The
next
day upon receipt of the Option Notice, Parties B and C, together with party
A
(or the qualified person appointed by Party A), shall promptly compile a whole
set of documents (the “Transfer Documents”) to be submitted to the government
bodies for approving the shares or assets transfer in connection with the Option
exercise so that the shares or assets transfer can be transferred, in whole
or
in part.
Upon
the
completion of the compilation of all the Transfer Documents and the Transfer
Documents being confirmed by Party A, Parties B and C shall promptly and
unconditionally obtain, together with Party A (or the qualified person appointed
by Party A), all approvals, permissions, registrations, documents and other
necessary approvals to effectuate the transfer of the shares and remaining
assets of Party C in connection with the Option exercise.
Exercise
Condition: Party A may immediately exercise the option of acquiring the equity
interests in or remaining assets of Party C whenever Party A considers it
necessary to acquire Party C and it is doable in accordance with PRC laws and
regulations.
| 2. |
Price
of Acquisition
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Party
A
and Party B shall enter into relevant agreements regarding the price of
acquisition based on the circumstances of the exercise of option. Party A has
the discretion to decide the time and arrangement of the acquisition, provided
that the acquisition will not violate any PRC laws or regulations then in
effect.
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3.
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REPRESENTATIONS
AND WARRANTIES
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3.1
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Each
party hereto represents to the other parties that: (1) it has all
the
necessary rights, powers and authorizations to enter into this Agreement
and perform its duties and obligations hereunder; and (2) the execution
or
performance of this Agreement shall not violate any significant contract
or agreement to which it is a party or by which it or its assets
are
bounded.
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3
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3.2
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Party
B hereto represents to Party A that: (1) they are legally registered
shareholders of Party C and have paid Party C the full amount of
their
respective portions of Party C's registered capital required under
the PRC
laws; (2) except Share Pledge Agreement, Party B has not mortgaged
or
pledged his shares of Party C, nor has either of them granted any
security
interest or borrow against his shares of Party C in any form; and
(3)
Party B has not sold or will not sell to any third party its equity
interests in Party C.
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3.3
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Party
C hereto represents to Party A that: (1) it is a limited liability
company
duly registered and validly existing under the PRC law; and (2) its
business operations are in compliance with applicable laws of the
PRC in
all material aspects.
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4.
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COVENANTS
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| The Parties further agree as follows: |
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4.1
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Before
Party A has acquired all the equity/assets of Party C by exercising
the
purchase option provided hereunder, Party C shall
not:
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4.1.1
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sell,
assign, mortgage or otherwise dispose of, or create any encumbrance
on,
any of its assets, operations or any legal or beneficiary interests
with
respect to its revenues (unless such sale, assignment, mortgage,
disposal
or encumbrance is relating to its daily operation or has been disclosed
to
and agreed upon by Party A in
writing);
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4.1.2
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enter
into any transaction which may materially affect its assets, liability,
operation, shareholders’ equity or other legal rights (unless such
transaction is relating to its daily operation or has been disclosed
to
and agreed upon by Party A in writing);
and
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4.1.3
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distribute
any dividend to its shareholders in any
manner.
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4.2
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Before
Party A has acquired all the equity/assets of Party C by exercising
the
purchase option provided hereunder, Party B and/or Party C shall
not
individually or collectively:
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4.2.1
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supplement,
alter or amend the articles of association of Party C in any manner
to the
extent that such supplement, alteration or amendment may have a material
effect on Party C's assets, liability, operation, shareholders’ equity or
other legal rights;
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4
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4.2.2
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cause
Party C to enter into any transaction to the extent such transaction
may
have a material effect on Party C's assets, liability, operation,
shareholders’ equity or other legal rights (unless such transaction is
relating to Party C's daily operation or has been disclosed to
and agreed
upon by Party A in writing);
and
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4.3
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Party
B shall entrust Party A to manage Party C in accordance with Entrusted
Management Agreement.
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5.
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ASSIGNMENT
OF AGREEMENT
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5.1
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Party
B and Party C shall not transfer their rights and obligations under
this
Agreement to any third party without the prior written consent of
Party A.
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5.2
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Each
of Party B and Party C hereby agrees that Party A shall have the
right to
transfer all of its rights and obligation under this Agreement to
any
third party whenever it desires. Any such transfer shall only be
subject
to a written notice sent to Party B and Party C by Party A, and no
any
further consent from Party B and Party C will be required.
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6.
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CONFIDENTIALITY
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| The Parties acknowledge and confirm that any oral or written materials exchanged by the Parties in connection with this Agreement are confidential. The Parties shall maintain the secrecy and confidentiality of all such materials. Without the written approval by the other Parties, any Party shall not disclose to any third party any relevant materials, but the following circumstances shall be excluded: |
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a.
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The
materials is known or will be known by the public (except for any
materials disclosed to the public by the Party who receives such
materials);
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b.
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The
materials are required to be disclosed under the applicable laws
or the
rules or provisions of stock exchange; or
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c.
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The
materials disclosed by each Party to its legal or financial consultant
relate to the transaction contemplated under this Agreement, and
such
legal or financial consultant shall comply with the confidentiality
set
forth in this Section. The disclosure of the confidential materials
by an
employee of any Party shall be deemed disclosure of such materials
by such
Party, and such Party shall be liable for breaching the contract.
This
Article 6 shall survive this Agreement even if this Agreement is
invalid,
amended, revoked, terminated or unenforceable by any reason.
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5
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7.
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BREACH
OF CONTRACT
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Any
violation of any provision hereof, any incomplete or mistaken performance
of any obligation provided hereunder, any misrepresentation made
hereunder, any material nondisclosure or omission of any material
fact, or
any failure to perform any covenants provided hereunder by any Party
shall
constitute a breach of this Agreement. The breaching Party shall
be liable
for any such breach pursuant to the applicable
laws.
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8.
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APPLICABLE
LAW AND DISPUTE RESOLUTION
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8.1
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Applicable
Law
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| The execution, validity, interpretation and performance of this Agreement and the disputes resolution under this Agreement shall be governed by the laws of PRC. |
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8.2
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Dispute
Resolution
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| The parties shall strive to settle any dispute arising from the interpretation or performance of this Agreement through friendly consultation. In case no settlement can be reached through consultation within thirty (30) days after such dispute is raised, each Party shall have the right to submit such matter to China International Economic and Trade Arbitration Commission (the “CIETAC”) in Beijing in accordance with its rules. The arbitration shall take place in Beijing. The arbitration award shall be final, conclusive and binding upon both parties. |
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9.
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EFFECTIVENESS
AND TERMINATION
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9.1
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This
Agreement shall be effective upon the execution hereof by all Parties
hereto and shall remain effective
thereafter.
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9.2
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This
Agreement may not be terminated without the unanimous consent of
all the
Parties except that Party A may, by giving a thirty (30) days prior
notice
to the other Parties hereto, terminate this
Agreement.
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6
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10.
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MISCELLANEOUS
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10.1
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Amendment,
Modification and Supplement
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| Any amendment and supplement to this Agreement shall be made by the Parties in writing. The amendment and supplement duly executed by each Party shall be deemed an integral part of this Agreement and shall have the same legal effect as this Agreement. |
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10.2
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Entire
Agreement
|
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| The Parties acknowledge that this Agreement constitutes the entire agreement of the Parties with respect to the subject matters therein and supersedes and replaces all prior or contemporaneous agreements and understandings in oral or written form. |
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10.3
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Severability
|
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| If any provision of this Agreement is adjudicated to be invalid or non-enforceable according to relevant PRC laws of the PRC, such a provision shall be deemed invalid only to the extent the PRC laws are applicable in China, and the validity, legality and enforceability of the other provisions hereof shall not be affected or impaired in any way. The Parties shall, through consultation based on the principal of fairness, replace such invalid, illegal or non-enforceable provision with valid provision so that any substituted provision may bring the similar economic effects as those intended by the invalid, illegal or non-enforceable provision. |
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10.4
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Headings
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| The headings contained in this Agreement are for the convenience of reference only and shall not in any other way affect the interpretation, explanation or the meaning of the provisions of this Agreement. |
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10.5
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Language
and Copies
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| This Agreement is written in Chinese and English. In case of any discrepancy between Chinese version and English version, Chinese version shall prevail. This Agreement is executed in three (3) copies for each version; each Party holds one and each original copy has the same legal effect. |
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10.6
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Successor
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| This Agreement shall bind and benefit the successor or the transferee of each Party. |
(REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK)
7
IN WITNESS THEREFORE, the parties hereof have caused this Agreement to be executed by their duly authorized representatives as of the date first written above.
PARTY
A: Shaanxi Biostar Biotech Ltd
(Seal)
Legal
Representative/Authorized Representative(Signature):
PARTY
B:
Xxxx
Xxxxxxx(signature):
Xxxx
Xxx(signature):
Xxxx
Xxxxxx(signature):
Wang
Rangmei(signature):
Xxx
Xxxxxx(signature):
Xxxx
Xxxxxx(signature):
An
Xiaoru(signature):
Ao
Quanfang(signature):
Xxxx
Xxxxxxx(signature):
Qin
Hongxia(signature):
Xx
Xxxx(signature):
Xx
Xxxxxxx(signature):
Bai
Rong(signature):
Xx
Xxx(signature):
PARTY
C: Shaanxi Aoxing Pharmaceutical Co., Ltd
(seal)
Legal
Representative/Authorized Representative(Signature):
8
