SHARE TRANSFER AGREEMENT
THIS SHARE TRANSFER AGREEMENT, dated as of January 12, 2005 is entered into
by and between Harbin Tech.Full Industry Co., Ltd., ("Party A") as transferor,
and Harbin Tech.Full Electric Co., Ltd. ("Party B") as transferee.
Whereas:
1. Party A and Party B, respectively, are companies organized under the
laws of the People's Republic of China"PRC";
2. Party B is a wholly owned subsidiary of Tech Full International, Inc.,
a company organized under the laws of Delaware ("Tech Full
International"); and Tech Full International seeks to become a public
company in the United States, under the name of Harbin Electric, Inc.
("Pubco");
3. Party A and Baldor Electric Company ("Baldor") entered into a Joint
Venture Contract dated May 20, 2004 (the "JV Agreement") to jointly
establish a company known as Harbin Baldor Tech.Full Electric Company
Limited ( the "JV "), of which Party A owns 65%. Baldor is a US public
company listed on the New York Stock Exchange under stock symbol
"BEZ". Baldor is a designer, manufacturer and marketer of electric
motors, drives and generators;
4. Party A hereby irrevocably transfers its ownership of sixty-five
percent (65%) of the JV's equity ownership to Party B, and Party B is
willing to accept such shares;
Now, the parties, intending to be legally bound, agree as follows:
ARTICLE I
DEFINITIONS
Unless it is decided by law, regulations, other legally binding principles,
rules, orders, and notice, or it is decided otherwise in this Agreement, the
terms and titles in this Agreement shall have the following meanings:
1.1 "Shareholder's Right" shall mean all of the JV shareholder's rights
under the laws of the PRC.
1.2 "Interest, Benefit, Claims, and Other Rights Associated with the
Shareholder's Right" shall mean all other rights and benefits that
Party A is entitled to as a shareholder other than the rights as
described in 1.1.
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ARTICLE II
TRANSFER OF SHARES
2.1 Party A shall transfer its entire ownership in the JV to Party B
according to the terms and conditions in this Agreement, as well as
the Shareholder's Right and all the Interest, Benefit, Claims and
Other Rights associated with the Shareholder's Right. Furthermore,
Party A shall transfer all of its rights, benefits and obligations
under the JV Agreement to Party B according to the terms and
conditions in this Agreement.
ARTICLE III
CONSIDERATION
3.1 Party B will, through Pubco, deliver to Party A, one million newly
issued restricted shares of Pubco. Such shares shall be issued to
Party A or its designated third party.
ARTICLE IV
TAXATION
4.1 All taxation and fees relating to the transfer and performance of this
Agreement are pursuant to the current taxation policies under
applicable laws of PRC. Party A warrants that under laws of the PRC,
the transfer of equity ownership hereto is a tax free event.
ARTICLE V
EFFECTIVENESS
5.1 This Agreement shall come into effect upon the execution hereof by all
the parties hereto.
ARTICLE VI
TERMINATION
6.1 Party A has the right to terminate this Agreement only due to the
occurrence of either one of the following:
(a) Tech Full International fails to become a public company in the
United States; or
(b) Party B fails to issue the shares prescribed in Article 3 when
Tech Full International becomes a public company in the United
States.
6.2 If Party A terminates this Agreement due to the occurrence of any of
the items in Article 6.1 above, Party A does not need to compensate
Party B. However, Party A shall reimburse Party B for any expenses
incurred by Party B provided that Party B can prove that the said
expenses were incurred due to the wrongful actions of Party A, and the
said expenses were incurred.
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ARTICLE VII
STATEMENT AND GUARANTEE
7.1 Party A makes the following statement and guarantee:
(a) It is a duly registered company in good standing under the laws
of PRC.
(b) It invested in the JV in accordance with Chinese law, and there
is no legal impediment for it to obtain the shares of the JV.
(c) It has the right and authority to execute and implement this
Agreement.
(d) The person signing this Agreement on behalf of Party A is duly
authorized by the Board of Directors.
(e) It has obtained the necessary consent for the transfer from
Baldor.
7.2 Party B makes the following statement and guarantee:
(a) It is a duly registered company in good standing under the laws
of PRC.
(b) It has the right and the capability to sign this Agreement, and
to execute its responsibilities under this Agreement. Once this
Agreement becomes effective, it shall fully and completely carry
out its duties under this Agreement.
(c) It has the right and authority to execute and implement this
Agreement.
(d) The person signing this Agreement on behalf of Party B is duly
authorized by the Board of Directors.
ARTICLE VIII
DISPUTE SETTLEMENT
8.1 In the event of any dispute resulting from the execution of this
Agreement, the parties shall resolve the dispute through friendly
negotiation. If the dispute cannot be resolved through friendly
negotiation, the parties shall submit the dispute to a competent court
for settlement.
ARTICLE IX
GOVERNING LAW
9.1 This Agreement shall be governed by, construed and interpreted in
accordance with the laws of the PRC.
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ARTICLE X
MISCELLANEOUS
10. 1 All notices or other communications under this Agreement shall be in
writing and shall be deemed to be duly given when (a) delivered in
person, or (b) sent by telecopy, telegram or telex, or (c) deposited
in the mail, postage prepaid, addressed as follows:
If to Harbin Tech.Full Industry Co., Ltd.:
Address: Junction of Haping Road and Weihai Road of Haping
Concentration District, Harbin Development Zone
Attn: Xxxxxx Xx
Tel: 0000-00000000
If to Harbin Tech.Full Electric Co., Ltd.:
Address: No. 9 Haping West Road, Haping Concentration
District, Harbin Development Zone
Attn.: Chungang Xia
Tel: 0000-00000000
Any party may, by notice to the other party, change the address to which
such notices are to be given.
10.2 Unless it is agreed in writing by the other party, neither shall have
the right to transfer or assign its rights and obligations to any
third parties.
10.3 No provisions of this Agreement shall be amended or modified by any
party, unless such amendment or modification is in writing and
executed.
10.4 Matters not included in this Agreement shall be negotiated by both
parties and the parties shall enter into supplementary written
agreements regarding the same. The supplementary written agreements
have equal legal effect with this agreement.
10.5 This Agreement is written both in Chinese and English. The Chinese
version will prevail if there is any conflict between the two
versions.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized representatives as of the day and year first above
mentioned.
Party A: Harbin Tech.Full Industry Co., Ltd.
Authorized Representative signature: /s/ Yang Tian Fu
Party B: Harbin Tech.Full Electric Co., Ltd.
Authorized Representative signature: /s/ Xxxx XxXxxxxxx
