EXCLUSIVE EQUITY INTEREST PURCHASE AGREEMENT
Exhibit
10.4
THIS EXCLUSIVE EQUITY INTEREST
PURCHASE AGREEMENT (the “Agreement”) is entered into by
and among the following parties effective as of March 25, 2010.
Party A: Beijing CHENGMUJINMING
Technology Service Co., Ltd, a wholly foreign-owned enterprise
incorporated under the PRC laws with its registered address at 1704F1 17th floor
Tsing Wun Contemporary Building, Mantingfangyuan housing estate, Qingyunli,
Haidian District, Beijing, China.
Party B: Shan Junfeng, a PRC
citizen with ID No. 370723195711293110
Address:
Apartment 1-1-201, Xx. 0 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx xxxxxxxx,
Xxxxx.
Party C: Weifang Jinzheng Poultry
Co., Ltd., a limited liability company duly established and validly
existing under the laws of the PRC, with its registered address at Daokou
Industry Park, Yingli Town, Shouguang, Shandong Province China
WHEREAS,
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1.
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Party B holds a 89.85% equity
interest in Party C; and
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2.
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Party
A and Party C, have entered into exclusive consulting service, and other
agreements.
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NOW THEREFORE, intending to be bound hereby, the Parties hereto agree as follows:
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1.
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Transfer of Equity
Interest
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1.1
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Grant of Purchase
Right
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Party B
hereby irrevocably grants Party A the exclusive right to purchase or designate
one or more persons (each a “Specified Person”) to purchase
all or any portion of the Equity Interest from Party B subject to compliance
with legal restrictions under applicable PRC laws (the “Purchase Right”). Party B
shall not sell or transfer all or any portion of the Equity Interest to any
party other than Party A and/or the Specified Person. Party C hereby agrees that
Party B may grant the Purchase Right to Party A, and the other shareholders of
Party C hereby waive any and all preemptive rights relating to the Equity
Interest evidenced by the Announcement document attached hereto as the Appendix.
The term “person” as used herein means an individual, corporation, joint
enterprise, partnership, enterprise, trust or non-corporation
organization.
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1.2
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Exercise of the Purchase
Right
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1.2.1
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To
the extent permitted under the PRC Laws, Party A, at its sole discretion,
may decide the specific time, method and number of its
exercise.
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Page 1 of
12
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1.2.2
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When
Party A intends to exercise the Purchase Right, it shall issue a written
notice (the “Purchase Notice”) to
Party B, and the Purchase Notice shall state the following: (a) Party
A intends to exercise the Purchase Right; (b) the percentage of the
Equity Interest to be purchased therewith; and (c) the effective date
or transfer date. Party A may exercise the Purchase Right one or more
times, in whole or in part.
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1.3
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Consideration of the Equity
Interest
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The
Transfer Fee (“Transfer
Fee”) payable by Party A shall be confirmed by both Party A and Party B
through negotiation according to the evaluation of the Equity Interest by the
relevant qualified institute, and it shall be the lowest price allowable by the
PRC laws and regulations.
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1.4
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Transfer of the Equity
Interest
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Each time
Party A exercises the Purchase Right in whole or in part:
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1.4.1
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Party B shall ensure that Party C
timely convenes a shareholders’ meeting, at which the shareholders of
Party C shall pass shareholders’ resolutions providing that Party B can
transfer to Party A or the Specified Person the Equity
Interest.
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1.4.2
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Party B shall enter into a Equity
Transfer Contract in relation to the Equity Interest in accordance with
this Agreement and Purchase
Notice.
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1.4.3
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The
Parties shall execute all other agreements or documents, obtain all
government approvals and consents, and take all actions necessary to
legally transfer the ownership of the Equity Interest to Party A or the
Specified Person and ensure that Party A or the Specified Person will be
registered as the owner of the Equity Interest. The Equity Interest shall
be free from any Security Interest or other encumbrance. For purposes of
this Agreement, “Security Interest” shall include any guarantee, mortgage,
third party rights or interest, purchase rights, preemption rights, offset
rights and any other security arrangements, but shall exclude any security
interest granted in accordance with this Agreement and the Equity Interest
Pledge Agreement entered into by and between Party B and Party A effective
as of March 25 ,2010 (“Equity Interest Pledge Agreement”). According to
the Equity Interest Pledge Agreement, Party B shall pledge all the equity
possessed by Party B in Party C to Party A as a guarantee of the fees
payable pursuant to the Exclusive Technical Consulting Service Agreement
entered into by and between Party C and Party A effective March 25,2010
(“Exclusive Technical Consulting Service
Agreement”).
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1.4.4
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Party
B and Party C shall unconditionally assist Party A in obtaining the
governmental approvals, permits, registrations, filings and completing all
the necessary formalities for obtaining the Purchase Equity
Interest.
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1.5
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Payment for the Equity
Interest
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1.5.1
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Party A shall pay the Transfer
Fee to Party B in accordance with the provision of Article
1.3.
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Page 2 of
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2.
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Covenants Relating to the Equity
Interest
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2.1
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Covenants of Party
C
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2.1.1
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Without the written consent of
Party A, Party C will not supplement, amend, or modify any provisions of
the constitutional documents of Party C and will not increase or reduce
its registered capital or change the equity holding structures in any
other way.
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2.1.2
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Party C shall remain legally
existing, in good standing, will prudently and efficiently operate its
business and deal with corporate affairs in accordance with commercial
standards and practice.
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2.1.3
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Without the prior written consent
of Party A, Party C shall not sell, transfer, mortgage or dispose of any
assets, business or beneficial rights of Party C, or allow any creation of
another security interest or other encumbrance upon its
assets.
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2.1.4
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Without the prior written consent
of Party A, Party C shall not incur, inherit, or guarantee any debts
except for (i) debt incured during the course of normal business
operations (excluding business loans); and (ii) the debt that has
been previously disclosed to Party A and to which Party A has provided
prior written consent.
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2.1.5
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Party C shall operate its
business normally to maintain the value of its assets, and shall not take
any action which shall bring any materially adverse influence upon the
business operation or the value of the
assets.
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2.1.6
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Without the prior written consent
of Party A, Party C shall not enter into any material agreement except in
the normal course of business. (For the purpose of this paragraph, an
agreement covering an amount in excess of RMB100,000 will be considered a
material agreement).
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2.1.7
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Without the prior written consent
of Party A, Party C shall not provide any loans or credit to any third
party.
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2.1.8
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At Party A’s request, Party C
shall provide Party A with any materials relating to the business
operation and financial status of Party
C.
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2.1.9
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Party C shall purchase insurance
from an insurance company acceptable to Party A and shall maintain such
insurance. The amount and kinds of such insurance shall be similar to
insurance carried by other companies which operate similar businesses and
possess similar assets.
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2.1.10
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Without the prior written consent
of Party A, Party C shall not merge with, combine with, make investment
in, purchase the equity or substantially all the assets of any other
entity.
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2.1.11
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Within 24 hours after receiving
notice or becoming aware thereof, Party C shall inform Party A of any
actual or potential litigation, arbitration, or administrative procedure
in relation to the Equity
Interest.
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2.1.12
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In order to keep the ownership of
all assets, Party C shall execute all necessary or proper documents, take
all necessary or proper actions, substitute all necessary or proper
claims, and make all necessary or proper answers to all compensation
claims.
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2.1.13
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Without
the prior written consent of Party A, Party C shall not allot any dividend
to any shareholder. However, Party C shall immediately allot all dividends
to the shareholders upon the request of Party
A.
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2.2
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Covenants of Party
B
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2.2.1
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Without the prior written consent
of Party A, Party B shall not sell, transfer, mortgage or dispose of any
rights or interest relating to the Equity Interest, or allow any creation
of other security interests or encumbrances on the Equity Interest
(excluding the Security Interest under this Agreement and the Equity
Interest Pledge
Agreement).
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Page 3 of
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2.2.2
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Party B shall use its best
efforts to prevent the shareholders of Party C from approving resolutions
relating to the sale, transfer, mortgage, or disposal of any rights or
interests relating to the Equity Interest, or allowing any creation of any
security interest or other encumbrance on the Equity Interest (excluding
the Security Interest created pursuant to this Agreement and the Equity
Interest Pledge Agreement).
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2.2.3
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Party B shall use its best
efforts to prevent the other shareholders of Party C from approving
resolutions relating to Party C’s merger with, combination with, purchase
of, or investment in any other
entity.
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2.2.4
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Party B shall inform Party A of
any actual or potential litigation, arbitration, or administrative
procedure in relation to the Equity
Interest.
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2.2.5
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Party B shall ensure that the
other shareholders of Party C approve the transfer of the Equity Interest
as set out in this
Agreement.
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2.2.6
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In order to keep ownership of the
Equity Interest, Party B shall cause Party C to execute all necessary or
proper documents, take all necessary or proper actions, substitute all
necessary or proper claims, and make all necessary or proper answer to all
compensation claims.
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2.2.7
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At the request of Party A from
time to time, Party B shall immediately transfer to Party A or the
Specified Person the Equity Interest unconditionally at any
time.
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2.2.8
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Party B shall strictly comply
with this Agreement and any other agreements which may be entered into by
and among Party B, Party C and Party A collectively or separately, and
shall perform its obligations under such agreements, and shall not take or
fail to take any actions which actions or inactions will affect the
validity and enforceability of such
agreements.
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3.
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Representations and
Warranties
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3.1
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Party B and Party C jointly and
severally represent and undertake as
follows:
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3.1.1
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Each such Party has the power to
enter into and deliver this Agreement and the Equity Transfer Contract to
be executed by Party B for the transfer of the Equity Interest and has the
power and capacity to perform its obligations under this Agreement and the
Equity Transfer Contract.
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3.1.2
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Neither the execution and
delivery of this Agreement or any Equity Transfer Contract, nor the
performance of the obligations under this Agreement or any Equity Transfer
Contract will: (i) violate any PRC laws; (ii) conflict with the
Articles of Association or other organizational documents of any party;
(iii) breach any contract or document which such Party is a party to
or which binds such Party; (iv) violate any required permit, approval
or any valid qualification; or (v) result in the cessation,
revocation or imposition of additional conditions on the required permit,
approval or qualification.
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3.1.3
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Party C has full and transferable
ownership of its assets and facilities. Besides the pledge and/or mortgage
incurred by this Agreement and the pledge of Party B’s equity interest
incurred by the Equity Interest Pledge Agreement, there is no other pledge
and/or mortgage on such assets and
facilities.
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Page 4 of
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3.1.4
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Party C has no outstanding debt
except for (i) the legal debt, incurred during the normal course of
business; and (ii) the debt that has been previously disclosed to
Party A.
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3.1.5
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Party C complies with all
applicable laws and
regulations.
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3.1.6
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There is no actual, pending or
potential litigation, arbitration, or administrative procedure in relation
to the Equity Interest, assets of Party C or other matters relating to
Party C.
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4.
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Effectiveness and Term of this
Agreement
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4.1
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This Agreement shall be executed
and come into effect as of the date first set forth above. This Agreement
shall expire on the date that is ten (10) years following the date
hereof unless earlier terminated as set forth in this Agreement or upon
mutual agreement of the Parties
hereto.
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4.2
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This
Agreement may be unilaterally extended prior to termination for a
successive ten(10) year term upon written notice by Party A, provided
such extension is permitted by law and subject to the approval of the
registration administration for the extension of Party C’s business
duration. The parties will cooperate to renew this Agreement upon such
notice by Party A if such renewal is legally permitted at the
time.
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5.
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Breach
of Contract
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5.1
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If
any party (“Defaulting Party”) breaches any provision of this Agreement,
which may cause damages to other parties (“Non-defaulting Party”), the
Non-defaulting Party can notify the Defaulting Party in writing,
requesting it rectify and correct such a breach of contract; if the
Defaulting Party does not take actions which rectify and correct such
breach to the satisfaction of the Non-defaulting Party within fifteen
(15) days upon the issuance of the written notice, the Non-defaulting
Party can take actions pursuant to this Agreement or other measures in
accordance with laws in response.
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5.2
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The
occurrence of the following events constitute a breach of contract by
Party B:
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5.2.1
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Any
violation by Party B of the provisions of this Agreement, or these exists
in the representation and warranties hereunder material mistakes,
inaccuracies or are otherwise
incorrect;
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5.2.2
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Transference
in any manner, or the pledging of any rights pursuant to this Agreement
without the prior written consent of Party
A;
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5.2.3
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This
Agreement and/or Equity Pledge Agreement becomes invalid or
unenforceable.
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5.3
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Should
a breach of contract or violation of provisions under Equity Pledge
Agreement and Business Operation Agreement occur, Party A can request
Party B that transfers all or part of Purchased Equity Interests at
Purchase Price to Party A or the Specified
Persons.
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6.
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Assignment
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6.1
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Without
prior written consent of the Party A, Party B shall not transfer its
rights and obligations under this Agreement to any third party; if Party B
dies, Party B agrees to transfer the rights and obligation under this
Agreement to the person approved by Party
A.
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Page 5 of
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6.2
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This
Agreement shall be binding on the successor to Party B and is effective on
any successor or transferee that is allowed by Party
A.
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6.3
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Party
B hereby agrees that Party A shall be able to transfer all of its rights
and obligation under this Agreement to any third party at its own
discretion. Upon such transfer, Party A is only required to provide
written notice to Party B, and no further consent from Party B will be
required.
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7.
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Governing Law and Dispute
Settlement
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7.1
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Governing
Law
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This
Agreement shall be governed by and interpreted according to the laws of the
PRC.
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7.2
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Dispute
Settlement
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With
regard to any dispute in relation to the interpretation or implementation of
this Agreement, the Parties shall negotiate in good faith to settle the dispute.
If the dispute cannot be settled within thirty (30) days from the date any
party issues written notice requesting settlement of a dispute through
negotiation, each party has the right to submit the dispute to the China
International Economic and Trade Arbitration Committee for arbitration according
to the valid arbitration rules. The arbitration shall be held in Beijing. The
arbitration award is final and binding on each party.
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8.
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Tax and
Expenses
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Each
party shall bear its own tax, costs and expenses relating to preparing for and
executing this Agreement, the Equity Transfer Contract and relation to
completing the contemplated deal.
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9.
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Notice
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Any
notice or other communication under this Agreement shall be in Chinese and be
sent to the address listed below or other address as may be designated from time
to time by hand delivery or mail or facsimile. Any notice required or given
hereunder shall be deemed to have been served: (a) on the same date if sent
by hand delivery; (b) on the tenth date after posting if sent by air-mail,
(c) on the fourth date if sent by the professional hand delivery which is
acknowledged worldwide; and (d) the receipt date displayed on the
transmission confirmation notice if sent by facsimile.
Party
A: Beijing CHENGMUJINMING Technology Service Co., Ltd
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Address:
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1704F1
00xx
xxxxx Xxxxxxxxxxxxxx Xxxxx, Mantingfangyuan housing estate, Qingyunli,
Haidian District, Beijing,
China.
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Party
B: Shan Junfeng
Address:
Apartment 0-0-000, Xx. 0 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx xxxxxxxx,
Xxxxx
Party
C: Weifang Jinzheng Poultry Co., Ltd.
Address:
Daokou Industry Park, Yingli Town, Shouguang, Shandong Province
China
Page 6 of
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10.
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Confidentiality
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10.1
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The Parties acknowledge and
confirm that any oral or written information relating to this Agreement
that is communicated among the Parties shall be deemed as confidential
information (“Confidential Information”). The Parties shall keep
confidential such Confidential Information and shall not disclose such
Confidential Information to any third party without the prior written
consent of the other Parties. The following information shall be excluded
from the definition of Confidential Information: (a) information that
is or becomes publicly available, so long as it is not disclosed by the
party receiving such Confidential Information; or (b) information
that is disclosed as required by applicable laws or regulations. In
addition, without ceasing to be Confidential Information, a Party may
disclose Confidential Information to its attorney or financial advisor so
long as such attorney or financial advisor needs access to such
information in order to ensure compliance with this Article and agrees to
keep such information confidential. The disclosure by the employee or
agent of each Party shall be deemed disclosure by such Party itself, and
the Party shall be liable therefor. The Parties agree that the provisions
of this Article shall survive notwithstanding the termination of this
Agreement.
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11.
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Further
Assurance
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11.1
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The Parties agree that each will,
without any hesitation, execute any necessary documents and take any
necessary actions for the purpose of performing the objectives of this
Agreement and will execute any documents and take any actions which are
beneficial for purposes of this
Agreement.
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12.
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Miscellaneous
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12.1
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Amendment and
Supplementation
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Any
revision, amendment or supplementation of this Agreement shall be in writing and
be executed by each Party.
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12.2
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Compliance with laws and
regulations
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The
Parties shall comply with all applicable laws and regulations which have been
formally issued and may be publicly acquired.
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12.3
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Entire
Agreement
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Unless it
is otherwise revised, amended or supplemented after execution, this Agreement
constitutes the entire agreement among the parties as to the subject matter of
this Agreement, and supersedes any prior oral or written negotiations,
statements or agreements among the parties relating thereto.
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12.4
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Headings
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Headings
in this Agreement are only set out for reading convenience, and shall not be
used to interpret, explain or otherwise influence the meaning of the provisions
of this Agreement.
Page 7 of
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12.5
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Severability
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If any of
the terms of this Agreement is declared invalid, illegal or unenforceable in
accordance with any applicable laws or regulations, the validity and
enforceability of the other terms hereof shall nevertheless remain unaffected,
and the Parties hereto agree to, through good faith negotiation, make valid
terms to replace such invalid, illegal or unenforceable terms, and the economic
results from such valid terms shall be close to, as much as may be possible, the
superseded invalid, illegal or unenforceable terms.
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12.6
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Successor
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This
Agreement shall be binding on the successor of each party or the transferee
permitted by the other parties and shall be interpreted for its
benefit.
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12.7
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Survival
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12.7.1
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Any duties incurred in relation
to this Agreement before expiration or early termination of this Agreement
shall continue to be effective after expiration or early termination of
the Agreement.
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12.7.2
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The provisions of Articles 7, 10
and 12.7 shall survive nothwithstanding the termination of this
Agreement.
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12.8
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Waiver
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Each
party may waive the terms and conditions under this Agreement in writing. Such
waiver document shall be effective only if it is duly signed by the party
granting such waiver. Any waiver relating to the breach of the other party in
certain circumstances shall not be deemed as a waiver for a similar breach in
other circumstances.
[The
remainder of this page is intentionally left blank]
Page 8 of
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EXCLUSIVE EQUITY INTEREST PURCHASE
AGREEMENT
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This page
is the signing page of this Exclusive Equity Interest Purchase
Agreement.
IN WITNESS WHEREOF, the
Parties have executed this Agreement on the date first above
written.
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Party
A: Beijing CHENGMUJINMING
Technology
Service Co., Ltd
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By:
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/s/
Shan Junfeng
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Name:
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Shan
Junfeng
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Its:
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Chief
Executive Officer
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Party
B: Shan Junfeng
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/s/
Shan Junfeng
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Shan
Junfeng
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Party
C: Weifang Jinzheng Poultry Co., Ltd.
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By:
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/s/
Shan Junfeng
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Name:
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Shan
Junfeng
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Its:
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Chief
Executive Officer
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Page 9 of
12
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EXCLUSIVE EQUITY INTEREST PURCHASE
AGREEMENT
|
Appendix
A
Announcement
Letter
Weifang
Jinzheng Poultry Co., Ltd. is a limited liability company duly established and
valid existing under the PRC laws, of which (i) I hold a 3.05% equity
interest and (ii) the other shareholders, Shan Junfeng, Xxxx Xxx and Xxxx
Xx, collectively hold the remaining 96.95% equity interest. I hereby irrevocably
waive any pre-emptive right I may have upon the other 96.95% equity interest
held by the other shareholders and will not encumber the transfer of the equity
interest you proposed.
This
Announcement Letter is effective as of March 25,2010.
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/s/
Xxxxx Xxxxx
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Xxxxx
Xxxxx
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Page 10
of 12
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EXCLUSIVE EQUITY INTEREST PURCHASE
AGREEMENT
|
Announcement
Letter
Weifang
Jinzheng Poultry Co., Ltd. is a limited liability company duly established and
valid existing under the PRC laws, of which (i) I hold a 3.55% equity
interest and (ii) the other shareholders, Shan Junfeng, Xxxxx Xxxxx and
Xxxx Xx, collectively hold the remaining 96.45% equity interest. I hereby
irrevocably waive any pre-emptive right I may have upon the other 96.45% equity
interest held by the other shareholders and will not encumber the transfer of
the equity interest you proposed.
This
Announcement Letter is effective as of March 25,2010.
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/s/
Xxxx Xxx
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Xxxx
Xxx
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Page 11
of 12
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EXCLUSIVE EQUITY INTEREST PURCHASE
AGREEMENT
|
Announcement
Letter
Weifang
Jinzheng Poultry Co., Ltd. is a limited liability company duly established and
valid existing under the PRC laws, of which (i) I hold a 3.55% equity
interest and (ii) the other shareholders, Shan Junfeng, Xxxxx Xxxxx and
Xxxx Xxx, collectively hold the remaining 96.45% equity interest. I hereby
irrevocably waive any pre-emptive right I may have upon the other 96.45% equity
interest held by the other shareholders and will not encumber the transfer of
the equity interest you proposed.
This
Announcement Letter is effective as of March 25,2010.
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/s/
Xxxx Xx
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Xxxx
Xx
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Page 12
of 12
