VOTING AGREEMENT
EXECUTION
COPY
VOTING
AGREEMENT, dated as of January 21, 2010 (this "Agreement"), by and among
A-Power Energy Generation Systems, Ltd., a company incorporated under the laws
of the British Virgin Islands (the "Company"), and the
stockholders listed on the signature pages hereto under the heading "Shareholders" (each, a "Shareholder" and collectively,
the "Shareholders").
WHEREAS,
as of the date hereof, the Shareholders own collectively 12,858,000 Common
Shares, which represent in the aggregate approximately 32.48% of the total
issued and outstanding shares of the Company; and
WHEREAS,
as a condition to the willingness of the Investors to enter into the Securities
Purchase Agreement and to consummate the transactions contemplated thereby
(collectively, the "Transaction"), the Investors
have required that each Shareholder agrees, and in order to induce the Investors
to enter into the Securities Purchase Agreement, each Shareholder has agreed, to
enter into this Agreement with respect to all the Common Shares now owned and
which may hereafter be acquired by the Shareholders and any other securities, if
any, which such Shareholder is currently entitled to vote, or after the date
hereof, becomes entitled to vote, at any meeting of stockholders of the Company
(the "Other
Securities").
NOW,
THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements contained herein, and intending to be legally bound hereby, the
parties hereto hereby agree as follows:
ARTICLE
I
VOTING AGREEMENT OF THE
STOCKHOLDER
SECTION
1.01. Voting
Agreement. Subject to the last sentence of this
Section 1.01, each Shareholder hereby agrees that at any meeting of the
stockholders of the Company, however called, and in any action by written
consent of the Company's stockholders, each of the Shareholders shall vote the
Common Shares and the Other Securities: (a) in favor of the
Shareholder Approval (as defined in the Securities Purchase Agreement) as
described in Section 4(p) of the Securities Purchase Agreement and (b) against
any proposal or any other corporate action or agreement that would result in a
breach of any covenant, representation or warranty or any other obligation or
agreement of the Company under the Securities Purchase Agreement or which could
result in any of the conditions to the Company's obligations under the
Securities Purchase Agreement not being fulfilled. Each Shareholder
acknowledges receipt and review of a copy of the Securities Purchase Agreement
and the other Transaction Documents (as defined in the Securities Purchase
Agreement).
ARTICLE
II
REPRESENTATIONS AND
WARRANTIES OF THE STOCKHOLDER
Each
Shareholder hereby represents and warrants, severally but not jointly, to each
of the Investors as follows:
SECTION
2.01. Authority Relative to This
Agreement. Each Shareholder has all necessary legal capacity,
power and authority to execute and deliver this Agreement, to perform his or its
obligations hereunder and to consummate the transactions contemplated
hereby. This Agreement has been duly executed and delivered by such
Shareholder and constitutes a legal, valid and binding obligation of such
Shareholder, enforceable against such Shareholder in accordance with its terms,
except (a) as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or similar laws
now or hereafter in effect relating to, or affecting generally the enforcement
of creditors' and other obligees' rights, (b) where the remedy of specific
performance or other forms of equitable relief may be subject to certain
equitable defenses and principles and to the discretion of the court before
which the proceeding may be brought, and (c) where rights to indemnity and
contribution thereunder may be limited by applicable law and public
policy.
SECTION
2.02. No
Conflict. (a) The execution and delivery of this
Agreement by such Shareholder does not, and the performance of this Agreement by
such Shareholder shall not, (i) conflict with or violate any federal, state or
local law, statute, ordinance, rule, regulation, order, judgment or decree
applicable to such Shareholder or by which the Common Shares or the Other
Securities owned by such Shareholder are bound or affected or (ii) result in any
breach of or constitute a default (or an event that with notice or lapse of time
or both would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the Common Shares or the Other
Securities owned by such Shareholder pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise or other
instrument or obligation to which such Shareholder is a party or by which such
Shareholder or the Common Shares or Other Securities owned by such Shareholder
are bound.
(b) The
execution and delivery of this Agreement by such Shareholder does not, and the
performance of this Agreement by such Shareholder shall not, require any
consent, approval, authorization or permit of, or filing with or notification
to, any governmental entity by such Shareholder, other than the filing of an
amendment to the Schedule 13D previously filed by Xxxxxxxx Xx.
SECTION
2.03. Title to the
Shares. As of the date hereof, each Shareholder is the owner
of the number of Common Shares set forth opposite its name on Appendix A attached
hereto, entitled to vote, without restriction, on all matters brought before
holders of shares of the Company, which Common Shares represent on the date
hereof the percentage of the outstanding stock and voting power of the Company
set forth on such Appendix. Such Common Shares are all the securities
of the Company owned, either of record or beneficially, by such
Shareholder. Such Common Shares are owned free and clear of all
security interests, liens, claims, pledges, options, rights of first refusal,
agreements, limitations on such Shareholder's voting rights, charges and other
encumbrances of any nature whatsoever, other than restrictions on transfer
arising under the Securities Act of 1933, as amended. No Shareholder
has appointed or granted any proxy, which appointment or grant is still
effective, with respect to the Common Shares or Other Securities owned by such
Shareholder.
2
ARTICLE
III
COVENANTS
SECTION
3.01. No Disposition or
Encumbrance of Shares. Each Shareholder hereby covenants and
agrees that, until the Shareholder Approval has been obtained, except as
contemplated by this Agreement and the Lock-Up Agreements (as defined in the Securities Purchase Agreement),
such Shareholder shall not offer or agree to sell, transfer, tender,
assign, hypothecate or otherwise dispose of, grant a proxy or power of attorney
with respect to, or create or permit to exist any security interest, lien,
claim, pledge, option, right of first refusal, agreement, limitation on such
Shareholder's voting rights, charge or other encumbrance of any nature
whatsoever ("Encumbrance") with respect to
the Common Shares or Other Securities, directly or indirectly, initiate, solicit
or encourage any person to take actions which could reasonably be expected to
lead to the occurrence of any of the foregoing; provided, however, that any
such Shareholder may assign, sell or transfer any Common Shares or Other
Securities provided that any such recipient of the Common Shares or Other
Securities has delivered to the Company and each Investor a written agreement in
a form reasonably satisfactory to the Investors that the recipient shall be
bound by, and the Common Shares and/or Other Securities so transferred, assigned
or sold shall remain subject to this Agreement; and, provided, further, that
such shareholder may grant a proxy or power of attorney in connection with a
shareholders meeting to vote in accordance with Section 1.01
hereof.
SECTION
3.02. Company
Cooperation. The Company hereby covenants and agrees that it
will not, and such Shareholder irrevocably and unconditionally acknowledges and
agrees that the Company will not (and waives any rights against the Company in
relation thereto), recognize any Encumbrance or agreement on any of the Common
Shares or Other Securities subject to this Agreement unless the provisions of
Section 3.01 have been complied with.
ARTICLE
IV
MISCELLANEOUS
SECTION
4.01. Further
Assurances. Each Shareholder will execute and deliver such
further documents and instruments and take all further action as may be
reasonably necessary in order to consummate the transactions contemplated
hereby.
SECTION
4.02. Specific
Performance. The parties hereto agree that irreparable damage
would occur in the event any provision of this Agreement was not performed in
accordance with the terms hereof and that any Investor (without being joined by
any other Investor) shall be entitled to specific performance of the terms
hereof, in addition to any other remedy at law or in equity. Any
Investor shall be entitled to its reasonable attorneys' fees in any action
brought to enforce this Agreement in which it is the prevailing
party.
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SECTION
4.03. Entire
Agreement. This Agreement constitutes the entire agreement
among the Company and the Shareholders with respect to the subject matter hereof
and supersedes all prior agreements and understandings, both written and oral,
among the Company and the Shareholders with respect to the subject matter
hereof.
SECTION
4.04. Amendment. The
provisions of this Agreement may not be amended or waived, nor may this
Agreement be terminated by the Company other than pursuant to the provisions of
Section 4.07.
SECTION
4.05. Severability. If
any term or other provision of this Agreement is invalid, illegal or incapable
of being enforced by any rule of law, or public policy, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of this Agreement is not affected in
any manner materially adverse to any party. Upon such determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in a mutually acceptable manner in order that the terms of this
Agreement remain as originally contemplated to the fullest extent
possible.
SECTION
4.06. Governing
Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by the
internal laws of the State of New York, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of New York or
any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. The parties hereby
agree that all actions or proceedings arising directly or indirectly from or in
connection with this Agreement shall be litigated only in the Supreme Court of
the State of New York or the United States District Court for the Southern
District of New York located in New York County, New York. The
parties consent to the jurisdiction and venue of the foregoing courts and
consent that any process or notice of motion or other application to any of said
courts or a judge thereof may be served inside or outside the State of New York
or the Southern District of New York by registered mail, return receipt
requested, directed to the party being served at its address set forth on the
signature pages to this Agreement (and service so made shall be deemed complete
three (3) days after the same has been posted as aforesaid) or by personal
service or in such other manner as may be permissible under the rules of said
courts. Each of the Company and each Shareholder irrevocably waives,
to the fullest extent permitted by law, any objection which it may now or
hereafter have to the laying of the venue of any such suit, action, or
proceeding brought in such a court and any claim that suit, action, or
proceeding has been brought in an inconvenient forum. EACH PARTY HEREBY IRREVOCABLY WAIVES
ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
4
SECTION
4.07. Termination. This
Agreement shall terminate immediately when Shareholder Approval has been obtained in accordance
with Section 4(p) of the Securities
Purchase Agreement.
[Signature
Page Follows]
5
IN
WITNESS WHEREOF, each Shareholder and the Company has duly executed this
Agreement.
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THE
COMPANY:
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By:
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Name:
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Title:
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Dated:
January ___, 2010
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Address:
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Xx.
00 Xxxxxxxx Xxxx
Xxxxx Xxxxxxxx, Xxxxxxxx
Liaoning
Province 110021
China
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STOCKHOLDERS:
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Xxxxxxxx
Xx
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Dated: January
___, 2010
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Address:
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No.
44 Jingxing Road
Tiexi District, Shenyang
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Liaoning
Province 110021
China
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STOCKHOLDERS:
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Xxxx
X. Xxx
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Dated: January
___, 2010
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Address:
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No.
44 Jingxing Road
Tiexi District, Shenyang
Liaoning
Province 110021
China
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APPENDIX
A
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Shareholder
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Common Stock
Owned
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Percentage of Stock
Outstanding
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Voting Percentage
of Stock
Outstanding
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Xxxxxxxx
Xx
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11,278,000
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28.49 | % | 28.49 | % | |||||||
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Xxxx
X. Xxx
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1,580,000
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3.99 | % | 3.99 | % | |||||||
