Exhibit 10.12
CALL OPTION AND COOPERATION AGREEMENT
Among
ATA TESTING AUTHORITY (HOLDINGS) LIMITED.
MA XXXX XXXX
XXXX XXX
and
ATA ONLINE (BEIJING) EDUCATION TECHNOLOGY LIMITED
February, 00xx, 0000
XXXXXXX, XXXXX
CALL OPTION AND COOPERATION AGREEMENT
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This Call Option and Cooperation Agreement ("this Agreement") is entered into in
Beijing, People's Republic of China (the "PRC") on [February, 12th], 2007 by and
among:
Party A: ATA Testing Authority (Holdings) Limited.
Address: Sea Meadow House, Blackburne Highway, (X.X.Xxx 116), Road Town,
Tortola, British Virgin Islands
Party B: Ma Xxxx Xxxx
Address: Xx. 0 Xx Xxxx Xxx Xxx Xxxxxx, Xxxxxxx, Xxxxx
ID Number: 110102631021233
Party C: Xxxx Xxx
Address: Xx. 0 Xxxxxxxx 0, Xx. 00 Xxx Xxxx Wo Road, Haidian District,
Beijing, China
ID Number: 000000000000000000
Party D: ATA Online Education Technology Limited
Address: Xxxx 000, Xxxxxxxx 0, Xx. 00, Xxx Xxx Xxxx Xxxxx Road, Haidian
District, Beijing, China.
WHEREAS,
(1) Party D, a company with limited liability duly organized under the People's
Republic of China, Party B and Party C are shareholders of Party D and each
holds 90% and 10% equity interests in Party D, respectively;
(2) Party A, a company with limited liability duly organized and validly
existing under the laws of the British Virgin Islands, provides through its
wholly owned subsidiary in the PRC -- ATA Learning (Beijing), Inc. (hereinafter
referred to as "ATA Beijing") certain technical support, strategic consulting
and other services to Party D, and currently ATA Beijing is a major business
partner of Party D;
(3) To finance the investment by Party B and Party C in Party D, Party A has
entered into loan agreements respectively with Party B and Party C on October
27, 2006 and has entered into an amendment to loan agreement with Party C on [ ]
2007 (collectively, the "Loan Agreement"). According the Loan Agreement, Party A
has provided Party B and Party C with loans of 900,000 RMB Yuan and 100,000 RMB
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Yuan respectively. Pursuant to the Loan Agreement, Party B and Party C shall
invest the full amount of the loans in Party D's registered capital; and
(4) Party B and Party C hereto wish to grant Party A or its designated eligible
entity the exclusive purchase option to acquire, at any time upon satisfaction
of the requirements under the PRC law, the entire or a portion of Party D's
share equity/assets owned by Party B and/or Party C.
NOW THEREFORE, in accordance with the principle of sincere cooperation,
mutual benefit and joint development and after friendly negotiations, the
Parties hereby enter into the following agreements pursuant to the provisions of
relevant laws and regulations of the PRC:
ARTICLE 1 DEFINITIONS
The terms used in this Agreement shall have the meanings set forth below:
1.1. "This Agreement" means this Call Option and Cooperation Agreement and all
appendices thereto, including written instruments as originally executed and as
may from time to time be amended and supplemented by the Parties hereto through
written agreements;
1.2. "The PRC" means, for the purpose of this Agreement, the People's Republic
of China, excluding Hong Kong, Taiwan and Macao;
1.3. "Date" means the year, month and day. In this Agreement, "within" or "no
later than", when used before a year, month or day, shall always include the
relevant year, month or day.
ARTICLE 2 THE GRANT AND EXERCISE OF PURCHASE OPTION
2.1 The Parties hereto agree that Party A shall be granted an exclusive purchase
option to acquire, at any time upon satisfaction of the requirements under
applicable laws and conditions as agreed in this Agreement (including, without
limitation, when Party B and/or Party C cease to be Party D's directors or
employees, or Party B and/or Party C attempt to transfer their share equity in
Party D to any party other than the existing shareholders of Party D) or
designate eligible entity to acquire entire or a portion of Party D's share
equity or owned by Party B and Party C or each of them("Option"). The Option
granted hereby shall be irrevocable during the term of
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this Agreement and may be exercised by Party A or any eligible entity designated
by Party A.
2.2 Pursuant to the laws and regulations of the PRC, Party A (or its designated
eligible entity) may exercise the Option by delivering a written notice to any
of Party B and Party C or Party D (as the case maybe) (the "Exercise Notice").
The Exercise Notice shall define the specific portion of the shares to be
purchased from Party B and/or Party C or the assets to be purchased from Party D
(hereinafter referred to as the "Purchased Shares (Asset)) and the purchase
method.
2.3 Within thirty (30) days of the receipt of the Exercise Notice, Party B,
Party C or Party D (as the case may be) shall execute a share/asset transfer
contract and other documents necessary to carry through such transfer
(collectively, the "Transfer Documents") with Party A (or any eligible party
designated by Party A).
2.4 When applicable laws permit the exercise of the purchase option provided
hereunder and Party A elects to exercise such purchase option, Party B, Party C
and Party D shall unconditionally assist Party A to obtain all approvals,
permits, registrations, filings and other procedures necessary to effect the
transfer of relevant share equity or assets.
ARTICLE 3 REPRESENTATIONS AND WARRANTIES
Each party hereto represents to the other parties that:
3.1 It has all the necessary rights, powers and authorizations to enter into
this Agreement and perform its duties and obligations hereunder;
3.2 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.
ARTICLE 4 EXERCISE PRICE
When it is permitted by applicable laws, Party A (or any eligible party
designated by Party A) shall have the right to acquire, at any time, all of
Party D's assets or its share equity owned by Party B and Party C, at a price
equal to the sum of the principles of the loans (RMB 1,000,000) from Party A to
Party B and Party C under the Loan Agreement. If Party A (or any eligible party
designated by Party A) elects to purchase a portion of Party D's share equity or
assets, then the exercise price for such purpose shall be adjusted accordingly
based on the percentage of such share
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equity or assets to be purchased over the total share equity or assets. When
Party A (or a qualified entity designated by party A) is to acquire all or a
portion of Party D's equity share or assets from Party B and Party C pursuant to
this Agreement, Party A has the right to substitute the principal amounts Party
B and Party C respectively owe Party A under the Loan Agreement for the purchase
prices payable to Party B and Party C, respectively.
ARTICLE 5 COVENANTS
The Parties further agree as follows:
5.1 Before Party A (or a qualified entity designated by Party A) has acquired
all the equity or assets of Party D by exercising the purchase option provided
hereunder, Party D shall not:
5.1.1 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 by Party A in writing);
5.1.2 enter into any transaction which may materially affect its assets,
liability, operation, equity or other legal rights (unless such transaction is
relating to its daily operation or has been disclosed to and agreed by Party A
in writing); and
5.1.3 distribute any dividend to its shareholders in any manner.
5.2 Before Party A (or a qualified entity designated by party A) has acquired
all the equity/assets of Party D by exercising the purchase option provided
hereunder, Party B and/or Party C shall not individually or collectively:
5.2.1 supplement, alter or amend the articles of association of Party D in
any manner to the extent that such supplement, alteration or amendment may have
a material effect on Party D's assets, liability, operation, equity or other
legal rights (except for pro rata increase of registered capital mandated by
applicable laws);
5.2.2 cause Party D enter into any transaction to the extent such
transaction may have a material effect on Party D's assets, liability,
operation, equity or other legal rights (unless such transaction is relating to
Party D's daily operation or has been disclosed to and agreed by Party A in
writing); and
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5.2.3 cause Party D's board of directors adopt any resolution on
distributing dividends to its shareholders.
5.3 Party B and Party C shall, to the extent permitted by applicable laws, cause
Party D's operational term to be extended to equal the operational term of ATA
Beijing.
5.4 Party A shall provide financings to Party D to the extent Party D needs such
financing to finance its operation. In the event that Party D is unable to repay
such financing due to its losses, Party A shall waive all recourse against Party
D with respect to such financing.
5.5 To the extent Party B and/or Party C are subject to any legal or economic
liabilities to any institution or individual other than Party A as a result of
performing their obligations under this Agreement or any other agreements
between them and Party A or ATA Beijing, Party A shall provide all support
necessary to enable Party B and/or Party C to duly perform their obligations
under this Agreement and any other agreements and to hold Party B and/or Party C
harmless against any loss or damage caused by their performance of obligations
under such agreements.
5.6 To the extent Party A decides to transfer all its rights under the Loan
Agreement to any third party and informs the other parties in writing, Party A
shall have the right to transfer the rights and responsibilities under this
Agreement to any third party without the prior consent from the other parties.
ARTICLE 6 CONFIDENTIALITY
Each Party shall keep confidential all the content of this Agreement.
Without the prior consent of all Parties, no Party shall disclose any content of
this Agreement to any other party or make any public announcements with respect
to any content of this Agreement. Notwithstanding the forgoing provisions of
this Article 6, the following disclosure shall be permitted: (i) disclosure made
pursuant to any applicable laws or any rules of any stock exchange; (ii)
disclosure of information which has become public information other than due to
any breach by the disclosing party; (iii) disclosure to any Party's
shareholders, legal counsel, accountants, financial advisors or other
professional advisors, or (iv) disclosure to any potential purchasers of a Party
or its shareholders' equity/assets, its other investors, debts or equity
financing providers, provided that the receiving party of confidential
information has agreed to keep the relevant information confidential (such
disclosure shall be subject to the consent of Party A in the event that Party A
is not the potential purchaser).
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Parties agree that this Article 6 shall survive upon any invalidity,
modification, expiration or termination of this Agreement.
ARTICLE 7 APPLICABLE LAW AND EVENTS OF DEFAULT
The execution, effectiveness, interpretation, performance and dispute
resolution of this Agreement shall be governed by the laws of the PRC.
Any violation of any provision hereof, incomplete performance of any
obligation provided hereunder, any misrepresentation made hereunder, material
concealment or omission of any material fact or failure to perform any covenants
provided hereunder by any Party shall constitute an event of default. The
defaulting Party shall assume all the legal liabilities pursuant to the
applicable laws.
ARTICLE 8 DISPUTE RESOLUTION
8.1 Any dispute arising from the performance of this Agreement shall be first
subject to the Parties' friendly consultations. In the event any dispute cannot
be solved by friendly consultations, the relevant dispute shall be submitted to
China International Economic and Trade Arbitration Commission in accordance with
the then effective arbitration rules of the Commission for arbitration;
8.2 The arbitration shall be administered by the Beijing branch of China
International Economic and Trade Arbitration Commission in accordance with the
then effective arbitration rules of the Commission in Beijing;
8.3 The arbitration award shall be final and binding on the Parties. The costs
of the arbitration (including but not limited to arbitration fee and attorney
fee) shall be borne by the losing party, unless the arbitration award stipulates
otherwise.
ARTICLE 9 EFFECTIVENESS
9.1 This Agreement shall be effective upon the execution hereof by all Parties
hereto and shall remain effective thereafter. This Agreement may not be
terminated without the unanimous consent of all the Parties except Party A may,
by giving a thirty (30) days prior notice to the other Parties hereto, terminate
this Agreement. This Agreement shall fully replace and substitute the Call
Option and Cooperation Agreement dated October 27 2006 entered by ATA Testing
Authority (Holdings) Limited, ATA Online Education Technology Limited, Ma
Xiaofeng, Xxxx Xxx and Xxxx Xxxxxxx.
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9.2 In the term of this Agreement, to the extent that the operation term of
Party A or Party D expires or is terminated for other reasons, this Agreement
shall be terminated upon such expiration or termination, provided that, Party A
has transferred its rights and responsibilities pursuant to Article 5.6 under
this Agreement.
ARTICLE 10 AMENDMENT
All Parties hereto shall fulfill their respective obligations hereunder. No
amendment to this Agreement shall be effective unless such amendment has been
agreed by all of the Parties and Party A and Party D have obtained necessary
authorization and approvals with respect to such amendment (including the
approval that Party A must obtain from the audit committee or other independent
body established under the Xxxxxxxx-Xxxxx Act, the NASDAQ Rules under the board
of directors of its overseas holding company -- ATA, Inc.). The amendment or
modification to this Agreement shall be the integral part of this Agreement and
shall have the same legal effect as this Agreement.
ARTICLE 11 COUNTERPARTS
This Agreement is executed in four (4) counterparts. Party A, Party B,
Party C and Party D shall each hold one counterpart. All the counterparts shall
have the same legal effect.
ARTICLE 12 MISCELLANEOUS
12.1 Party B and Party C's obligations, covenants and liabilities to Party A
hereunder are joint and several, and Party B and Party C shall assume joint and
several liabilities with respect to such obligations, covenants and liabilities.
With respect to Party A, a default by Party B or Party C shall automatically
constitute a default by the other Party, and vice versa;
12.2 The title and headings contained in this Agreement are for convenience of
reference only and shall not in any way affect the meaning or interpretation of
any provision of this Agreement;
12.3 The Parties may enter into supplementary agreements to address any issue
not covered by this Agreement. The supplementary agreements so entered shall be
an appendix hereto as the integral part of this Agreement and shall have the
same legal effect as this Agreement.
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(THE FOLLOWING SPACE IS INTENTIONALLY LEFT BLANK)
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(Execution Page Only)
Party A: ATA Testing Authority (Holdings) Limited
(COMPANY SEAL):
Authorized Representative (Signature):
Party B: Ma Xxxx Xxxx
(Signature):
Party C: Xxxx Xxx
(Signature):
Party D: ATA Online (Beijing) Education Technology Limited
(COMPANY SEAL):
Authorized Representative (Signature):
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