EXHIBIT 10.9
DATED 6TH JULY, 2005
(1) MINDRAY INTERNATIONAL HOLDINGS LIMITED
(2) SHENZHEN MINDRAY BIO-MEDICAL ELECTRONICS CO., LTD.
(3) THE INVESTORS
(4) THE MAJOR SHAREHOLDERS
(5) DRAGON CITY INTERNATIONAL INVESTMENT LIMITED
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SUBSCRIPTION AND SHARE PURCHASE AGREEMENT
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AGREED FORM DOCUMENTS
(1) Shareholders' Agreement
(2) Disclosure Letter
(3) Cayman Islands counsel opinion
(4) Registration rights term sheet
(5) Performance Adjustment Escrow Agreement
(6) Instruction Letter to Xxxxxxxx Chance
THIS AGREEMENT is made on 6th July 2005
BETWEEN:
(1) MINDRAY INTERNATIONAL HOLDINGS LIMITED a private limited company
incorporated in the Cayman Islands with its registered office at c/o Codan
Trust Company (Cayman) Limited, Century Yard, Cricket Square, Xxxxxxxx
Drive, P.O. Box 2681 GT, Xxxxxx Town, Grand Cayman, British West Indies
(the "COMPANY");
(2) SHENZAEN MINDRAY BIO-MEDICAL ELECTRONICS CO., LTD., a foreign invested
company limited by shares incorporated in the People's Republic of China,
with its legal address at Mindray Building, Keji 12' Road South, Hi-tech
Industrial park, Xxxxxxx, Xxxxxxxx, XXX, 000000 (the "PRC COMPANY");
(3) THE PERSONS whose names and addresses are set out in Part B of Schedule 1
(together the "INVESTORS" and each an "INVESTOR");
(4) THE INDIVIDUALS whose names and addresses are set out in Part A of Schedule
1 (the "MAJOR SHAREHOLDERS" and each a "MAJOR SHAREHOLDER"); and
(5) DRAGON CITY INTERNATIONAL INVESTMENT LIMITED, a private limited company
incorporated in the British Virgin Islands with its registered office at
OMC Xxxxxxxx, X.X. Xxx 0000, Xxxx Xxxx, Xxxxxxx, Xxxxxxx Xxxxxx Xxxxxxx
("XXX").
WHEREAS:
(A) The Company is a private limited company organised and existing under the
laws of the Cayman Islands.
(B) Immediately before the date of this Agreement, the Company had an
authorised share capital of HK$380,000 comprising 38,000,000 ordinary
shares of HK$0.01 and as at the date hereof, 1 ordinary share has been
issued and is fully paid or credited as fully paid. Pursuant to the
Restructuring (as defined below) the Company will acquire at least 80% of
the entire issued share capital of the PRC Company which is involved in the
business of research and development, manufacturing and distribution of
medical equipment and related products and the provision of services for
such equipment and products. Further information relating to the Company,
the PRC Company and its subsidiaries and DCL, immediately before the date
of this Agreement, is contained in Schedule 2 Part A and B.
(C) The Company has agreed to issue, and the Investors have agreed to subscribe
for the Subscription Shares (as defined below), the Major Shareholders have
agreed to sell, and the Investors have agreed to purchase the Secondary
Shares (as defined below) and DCL has agreed to sell, and the Investors
have agreed to purchase the DCL Shares (as defined below). The Completion
of the sale of the Secondary Shares and DCL Shares, and the subscription of
the Subscription Shares shall be simultaneous.
(D) This Agreement sets out the terms on which the Investors will invest in the
Company.
THE PARTIES AGREE as follows:
1. INTERPRETATION
1.1 In this Agreement:
"2005 NET PROFITS" means the consolidated net profits after tax and
minority interests of the PRC Company but excluding any one-time gains or
losses from asset sales, all as shown in the audited consolidated accounts
of the Group for the financial year ending 31 December 2005 as audited by a
Big 4 accounting firm in accordance with Accounting Principles;
"ACCOUNTS" means the audited consolidated accounts of the PRC Company for
the financial year ended on the Last Accounting Date, the auditors' report
on those accounts, the directors' report for that year and the notes to
those accounts;
"ACCOUNTING PRINCIPLES" means the International Financial Reporting
Standards ("IFRS") promulgated by the International Accounting Standards
Board ("IASB") (which includes standards and interpretations approved by
the IASB and International Accounting Standards (IAS) issued under previous
constitutions), together with its pronouncements thereon from time to time,
and applied on a consistent basis;
"AFFILIATE" means with respect to any person, any other person that
directly or indirectly, through one or more intermediaries, Controls, is
Controlled by, or under common Control with the first mentioned person;
"ANNUAL BUDGET" means the Group's annual budget attached as Schedule 5;
"ARTICLES" means the new articles of association of the Company as amended
from time to time and references in this Agreement to an "Article" shall be
construed accordingly;
"ASSOCIATE" has the meaning set out in the Listing Rules;
"BIG 4" means any of KPMG, Deloitte Touche Tohmatsu, PricewaterhouseCoopers
and Ernst & Young or their respective successors;
"BOARD" means the board of directors of the Company from time to time;
"BUSINESS DAY" means a day (excluding Saturday) on which banks are
generally open for business in Hong Kong and in the PRC;
"BUY-OUT EXPENDITURES" means the aggregate amount paid by the Company
whether in the form of cash or shares, for the acquisition of any shares in
the PRC Company made after the date on which the Convertible Redeemable
Preference Shares are issued to the Investors up to the Ownership
Adjustment Date;
"CAYMAN PRE MONEY VALUATION" means:
(US$341,440,000 x the Company's percentage ownership in the PRC
Company as of the Ownership Adjustment Date) - (Buy-out Expenditures)
"COMPANIES ORDINANCE" means the Companies Ordinance (Chapter 32 of the Laws
of Hong Kong), as amended from time to time;
"COMPLETION" means the completion of the subscription for, and allotment
of, the Subscription Shares and the sale and purchase of the Secondary
Shares and DCL Shares in accordance with Clause 3;
"COMPLETION DATE" means the date to be agreed by the parties for Completion
which is not later than 5 Business Days after the date on which the last of
the Conditions is satisfied or waived, as the case may be, unless another
date is agreed by all the parties in writing;
"CONDITIONS" has the meaning set out in Clause 2.1; "Confidential
Information" has the meaning set out in Clause 10;
"CONTROL" means the power of a person (or persons acting in concert) to
secure that the affairs of another are conducted directly or indirectly in
accordance with the wishes of that person (or persons acting in concert) by
means of: in the case of a company, being the beneficial owner of more than
50 per cent. of either the issued share capital of that company or of the
voting rights in that company, or having the right to appoint or remove a
majority of the directors or otherwise control the votes at board meetings
of that company by virtue of any powers conferred by the articles of
association, shareholders' agreement or any other document regulating the
affairs of that company; in the case of a partnership, being the beneficial
owner of more than 50 per cent. of the capital of that partnership, or
having the right to control the composition of or the votes to the majority
of the management of that partnership by virtue of any powers conferred by
the partnership agreement or any other document regulating the affairs of
that partnership; or, in the case of an individual, being an Associate of
that individual; and "CONTROLLED" shall be construed accordingly. For these
purposes, "PERSONS ACTING IN CONCERT", in relation to a person, are persons
who actively co-operate, pursuant to an agreement or understanding (whether
formal or informal), with a view to obtaining or consolidating Control of
that person;
"CONVERSION PRICE" means the price per Share to be issued upon conversion
of all or some of the Convertible Redeemable Preference Shares and which is
calculated in accordance with the Terms and Conditions;
"CONVERSION SHARES" means the Shares to be issued by the Company upon the
conversion of the Convertible Redeemable Preference Shares;
"CONVERTIBLE REDEEMABLE PREFERENCE SHARES" means the convertible redeemable
preference shares of HK$0.01 each in the capital of the Company, having the
rights and being subject to the restrictions set out in the Terms and
Conditions;
"CUT-OFF DATE" means 15 August 2005 or such later date as may be agreed by
any one of the Investors and the Major Shareholders in writing;
"DCL AMOUNT" means US$3,970,233 the aggregate purchase price for the DCL
Shares;
"DCL SHARES" means the total number of Convertible Redeemable Preference
Shares to be sold by DCL and bought by the Investors that is equal to
1/86a' ownership of the entire issued share capital of the PRC Company
immediately before Completion;
"DISCLOSURE LETTER" means the letter of today's date from the Warrantors to
the Investors together with the documents scheduled thereto for the
purposes of Clause 5 receipt of which has been acknowledged by the
investors;
"ENCUMBRANCE" means a lien, charge of other encumbrance or right
exercisable by a third party having similar effect including, without
limitation, options, warrants and other rights (including conversion or
pre-emption);
"ENVIRONMENTAL LAW" has the meaning set out in Warranty 10.3;
"ENVIRONMENTAL PERMIT" has the meaning set out in Warranty 10.1;
"EQUITY SHARE CAPITAL" means the issued share capital of the Company
including the Convertible Redeemable Preference Shares, but excluding any
part thereof which does not either as respects dividends or as respects
capital carry any right to participate beyond a specified amount or beyond
an amount calculated by reference to a specified rate in a distribution;
"ESCROWED SHARE CERTIFICATES" means share certificates for the maximum
number of shares (for the Major Shareholders) or Convertible Redeemable
Preference Shares (for the Investors) required to implement the Performance
Adjustment;
"ESCROWED SHARE TRANSFER INSTRUMENTS" means blank, undated transfer
instruments executed by each of the Major Shareholders and the Investors
and which are deposited with Law Debenture Corporation;
"FAMILY MEMBER" means the spouse, co-habitee, mother, father, grandmother,
grandfather, brother, sister or child of a Major Shareholder;
"FULLY DILUTED SHARE CAPITAL" means, at any time, the total number of
Shares then issued, assuming the conversion, exchange and exercise in full
of all of the then issued Ordinary Share Equivalents, including, the
conversion of all the issued Convertible Redeemable Preference Shares at
the then prevailing Conversion Price;
"GOVERNMENT AUTHORITY" means the government of any nation, state, province,
city, locality or other political subdivision thereof, any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government;
"GOVERNMENT OFFICIAL" means any officer or employee of any government or
any department, agency, or instrumentality thereof, or any person acting in
an official capacity for or on behalf of any such government or department,
agency, or instrumentality as well as persons employed by commercial
enterprises owned or. controlled by a PRC Government Authority;
"GROUP" means the Company and its subsidiaries, and the PRC Company and its
subsidiaries, and "Group Member" means any one of them (including the
Company itself);
"HK$" means the lawful currency of Hong Kong;
"HONG KONG" means the Hong Kong Special Administrative Region of the PRC;
"IPO" means a listing of the ordinary share capital of the Company on the
Stock Exchange;
"INTELLECTUAL PROPERTY RIGHTS" means:
(a) patents, trade marks, service marks, registered designs, applications
and rights to apply for any of those rights, trade, business and
company names, interne domain names and e-mail addresses, unregistered
trade marks and service marks, copyrights, database rights, rights in
software, knowhow, rights in designs and inventions; and
(b) rights under licences, consents, orders, statutes or otherwise in
relation to a right in paragraph (a);
"INTERNAL IT SYSTEMS" means the information and communications technologies
used by the Group, including hardware, proprietary and third party software
and networks;
"INVESTOR DIRECTOR" means the director appointed from time to time by the
Investors pursuant to Clause 3.1 of the Shareholders' Agreement, the first
such Investor Director . being appointed upon Completion;
"KEY EMPLOYEES" means those individuals whose names and PRC identity
numbers are set out in Schedule 7;
"LAST ACCOUNTING DATE" means 31 December 2004;
"LISTING" means the listing of, and commencement of dealing in, the
Company's shares (including, but not limited to, those held by the
Investors) on the Stock Exchange;
"LISTING RULES" means the Rules Governing the Listing of Securities on The
Stock Exchange of Hong Kong Limited which are in force from time to time;
"MATERIAL ADVERSE CHANGE" means any change to the business, operations,
assets, conditions (financial or otherwise), or prospects of any Group
Member that is or would
reasonably be expected to result in losses, damages, liabilities and claims
to the Group that in aggregate may reduce in the 12 months from the
occurrence of the event (or the last of them, as appropriate) the fair
market value of the Group by not less than US$20,000,000;
"ORDINARY SHARE EQUIVALENTS" means any security or obligation which is by
its terms convertible into or, exchangeable or exercisable for Shares or
other share capital of the Company, including without .limitation, the
Convertible Redeemable Preference Shares, other convertible preference
shares or convertible debt instruments, any option, warrant or other
subscription or purchase right with respect to the Shares or other share
capital in the Company;
"OTHER DOCUMENTS" means the Shareholders' Agreement and the Registration
Rights Agreement to be entered into between the Company and the Investors
as of the Completion Date and the Performance Adjustment Escrow Agreement;
"OWNERSHIP ADJUSTMENT DATE" means the earlier of (i) the earliest
practicable date prior to an IPO and (ii) the Performance Adjustment Date;
"PARENT GROUP" means with respect to an entity, its direct and indirect
subsidiaries and Affiliates;
"PERFORMANCE ADJUSTMENT" means the performance adjustment which is
calculated in accordance with Clause 8 of the Shareholders' Agreement;
"PERFORMANCE ADJUSTMENT DATE" means the date upon which adjustments shall
be performed which shall be a date that falls within 1 month following the
date the audited accounts of the PRC Company for the year ending 31
December 2005 are available but in any event no later than 30 June 2006;
"PERFORMANCE ADJUSTMENT ESCROW AGREEMENT" means the escrow agreement to be
entered into by the Investors, the Major Shareholders and Law Debenture
Corporation (or another escrow agent reasonably satisfactory to the
parties) which is in the agreed form;
"PERMITTED TRANSFER" means any transfer of Equity Share Capital:
(i) to a person who is to hold such Equity Share Capital transferred, as a
nominee on behalf of the transferor (but excludes any transfer by such
nominees and a nominee for the purposes of this definition excludes
any entity that is a member of an Investor);
(ii) by a nominee to the beneficial owner of such Equity Share Capital to
another nominee of the same beneficial owner; or
(iii) to an Affiliate; or
(iv) in the case of a Major Shareholder to a Family Member;
"PRC" means the People's Republic of China excluding, for the purposes of
this Agreement, Hong Kong, the Macau Special Administrative Region and
Taiwan;
"QUALIFIED IPO" has the meaning set out in the Shareholders' Agreement;
"REGISTRATION RIGHTS AGREEMENT" means the registration rights agreement
(which shall be based upon the registration rights term sheet which is in
the agreed form) to be entered into between the Investors and the Company;
"RESOLUTIONS" means the resolutions of the Company and the Board approving
execution of this Agreement and the Shareholders' Agreement, inter-alia,
the creation and allotment of the Subscription Shares and amendments to the
Articles to include the Terms and Conditions and provided permitted by the
laws of the Cayman Islands Clauses 3.1 to 3.8, 5.1 and 5.2 of the
Shareholders' Agreement, and the adoption of such amended Articles;
"RESTRUCTURING" means the acquisition of at least 80% of the entire issued
share capital of the PRC Company by the Company or through some other
entity or entities, all being owned entirely by the Company;
"RMVIB" means Renrninbi, the lawful currency of the PRC;
"SECONDARY SALE AMOUNT" means US$7,940,465 the aggregate purchase price for
the Secondary Shares;
"SECONDARY SHARES" means the total number of Convertible Redeemable
Preference Shares to. be sold by the Major Shareholders and bought by the
Investors that is equal to 2/86'h ownership of the entire issued share
capital of the PRC Company immediately before Completion;
"SHAREHOLDERS' AGREEMENT" means the shareholders' agreement relating to the
Company in the agreed form;
"SHARE(S)" means ordinary shares of HK$0.01 each in the issued share
capital of the Company existing on the date of this Agreement and all other
(if any) stock or shares from time to time and for the time being ranking
pan passu therewith and all other (if any) stock or shares in the Equity
Share Capital resulting from any sub-division, consolidation or
re-classification thereof; having the rights and being subject to the
restrictions set out in the Articles;
"STOCK EXCHANGE" means The Stock Exchange of Hong Kong Limited or such
other internationally recognised stock exchange as may be agreed by any one
of the Investors and the Major Shareholders in writing from time to time;
"SUBSCRIPTION AMOUNT" means US$40,000,000 in aggregate, representing (i)
the Subscription Monies, (ii) the Secondary Sale Amount, and (iii) the DCL
Amount
"SUBSCRIPTION MONIES" means US$28,089,302 representing the entire amount
paid by the Investors for the Subscription Shares;
"SUBSCRIPTION SHARES" means the total number of Convertible Redeemable
Preference Shares to be issued to the Investors and subscribed for by the
Investors that is equal to x in the following formula:
US$40,000,000 Total number of Shares in
x = ---------------- x issue in the Company Seconary DCL
Cayman Pre-Money immediate prior to - Shares - Shares
Valuation Completion
"TAX" means any form of Taxation, levy, duty, charge, contribution or
impost of . whatever nature (including any related fine, penalty, surcharge
or interest) imposed by a Tax Authority;
"TAX AUTHORITY" means any local, municipal, governmental, state, federal or
other fiscal, revenue, customs or excise authority, body or official
anywhere in the world including, without limitation, the Inland Revenue
Department of Hong Kong, the State Tax Bureau of the PRC and the relevant
provincial andlor local Tax bureau of the PRC;
"TERMS AND CONDITIONS" means the terms and conditions of the Convertible
Redeemable Preference Shares attached at Schedule 6;
"US$" means the lawful currency of the United States of America;
"WARRANTIES" means each of the statements set out in Schedule 3 (each a
"Warranty");
"WARRANTORS" means each of the Major Shareholders, DCL and the Company; and
"WARRANTY CLAIM" means a claim made by any of the Investors pursuant to or
under Clause 5 of this Agreement.
1.2 In this Agreement, a reference to:
1.2.1 a "CERTIFIED COPY" is a reference to a document certified by a
director of the Company as being a true and complete copy of the
original;
1.2.2 "COSTS" includes a reference to costs, charges and expenses of every
description;
1.2.3 a "SUBSIDIARY" or "holding company" shall be construed in accordance
with Section 2 of the Companies Ordinance;
1.2.4 a document in the "agreed form" is a reference to a document in
substantially the form approved and for the purposes of identification
initialled by or on behalf of each of the parties;
1.2.5 a "PERSON" includes a reference to a body corporate, association,
joint venture or partnership, in each case, whether incorporated or
not;
1.2.6 a "PERSON" includes a reference to that person's heir, legal personal
representative or successors;
1.2.7 a "PARTY" is a reference to a party to this Agreement by virtue of it
having executed this Agreement and "parties" means all of them;
1.2.8 "INCLUDING" shall be construed without limitation; and
1.2.9 a Recital, a Clause or a Schedule, unless the context requires
otherwise, is a reference to a Recital of, Clause of or a Schedule to
this Agreement.
1.3 Where a consent or approval is expressed in this Agreement to be required
of the Investors it shall be deemed to have been given if the relevant
matter or transaction has been approved by (i) any one of the Investors in
writing and (ii) the Investor Director in compliance with all procedures in
the Articles regarding notice and Board meetings and either (a) Clauses
1.3.1 to, 1.3.3 have all been satisfied or (b) Clause 1.3.4 has been
satisfied:
1.3.1 been approved at a Board meeting at which the, Investor Director is
present with the Investor Director affirmatively voting in favour of
the specific relevant matter or transaction;
1.3.2 been recorded clearly in the minutes of that Board meeting as a
matter which requires the consent of the Investors and which has
received the prior consent of the Investor Director; and
1.3.3 a copy of the board minutes of the relevant meeting has been
acknowledged in writing or countersigned by the Investor Director as
representing a true and accurate record of the matters discussed and
agreed at that meeting by such Investor Director; or
1.3.4 been consented to in advance in writing by the Investor Director.
The Investor Director shall at all times be authorised to exercise the
approval rights of an Investor on behalf of all the Investors distinct from
the exercise of approval rights in his capacity as an Investor Director.
Such approval rights shall be exercised . . contemporaneously with the
exercise of Investor Director approval rights but by way of a separate
written instrument.
For the avoidance of doubt, if consent is sought and obtained from an
Investor andlor an Investor Director, such consent shall be binding on all
other Investors, and in the event that consent is requested in writing from
an Investor and/or an Investor Director and no reply is received within 5
Business Days of such request, consent shall be deemed to have been granted
by the Investors in the case of a request made of an Investor, and by the
Investor Director in the case of a request made of an Investor Director.
1.4 The headings in this Agreement do not affect its interpretation.
2. CONDITIONS AND CONDUCT BEFORE COMPLETION
2.1 Completion is subject to and conditional upon the following conditions:
2.1.1 receipt of all necessary approvals and consents required in
connection with the Restructuring and/or the matters contemplated
herein from any Government Authority;
2.1.2 completion of the Restructuring in accordance with applicable laws
and regulations and resulting in a corporate structure that can
qualify the Company for Listing pursuant to Chapter 8 of the Listing
Rules, save that in the event that the Subscription Amount is required
to effect the Restructuring and if all other PRC approvals necessary
for the completion of the Restructuring, other than any payment
obligations have been satisfied, then this Condition shall be deemed
to have been satisfied;
2.1.3 written confirmation, although this need not be in the form of an
opinion and for the avoidance of doubt can be in the form of an email,
from the accountants of the PRC Company (who shall be a Big 4
accounting firm) that following completion of the Restructuring it
will be appropriate under IFRS to adopt the pooling/merger method to
account for the combined results of the Company and the PRC Company;
2.1.4 Cayman Islands counsel for the Company has provided a legal opinion
addressed to the Investors substantially in the agreed form;
2.1.5 PRC counsel for the Company being King & Wood or some other counsel
acceptable to the Investors, has provided a legal opinion addressed to
the Investors covering those matters referred to in Schedule 4;
2.1.6 the passing of the Resolutions;
2.1.7 no material breach of this Agreement and the Warranties shall have
been true, complete and accurate, and not misleading when made and
shall be true, complete and accurate, and not misleading as of the
Completion Date as if made as of the Completion Date; provided,
however, that unless a material breach of this Agreement or of any
Warranty when made and as at the Completion Date is or is reasonably
likely to amount to, when aggregated with any other breach of any
Warranty or other obligation under this Agreement, a reduction of no
less than US$20,000,000 to the fair market value of the Group, this
Condition shall be deemed to have been satisfied;
2.1.8 no Government Authority has commenced any action in connection with
or in anticipation of the transactions hereunder (including the
Restructuring and any acquisition of an interest in the Company by the
Major Shareholders) that would render any such transactions void; or
enacted any statute or regulation which would prohibit or materially
restrict (i) the transactions contemplated
2.1.9 there has been no Material Adverse Change; and
2.1.10 Law Debenture Corporation (or another escrow agent reasonably
satisfactory to the parties), the Investors and the Major Shareholders
have executed the Performance Adjustment Escrow Agreement in the
agreed form,
(together the "CONDITIONS") being satisfied (or in the case of Conditions
2.1.1, 2.1.2 and 2.1.10 being waived in writing by mutual agreement between
the Company, DCL, the Major Shareholders and any one of the Investors and
in the case of Conditions 2.1.3 to 2.1.9 being waived in writing by any one
of the Investors) as soon as practicable following execution of this
Agreement.
2.2 The Company, DCL, the PRC Company and each of the Major Shareholders shall
each use its best endeavours to ensure the satisfaction of the Conditions
set out in Clause 2.1.
2.3 If, at any time, any party becomes aware of a fact or circumstance that
might prevent a Condition from being satisfied, it shall immediately inform
the other Parties of the matter in writing.
2.4 If the Conditions are not satisfied (or in the case of Conditions 2.1.1,
2.1.2 and 2.1.10 waived in writing by mutual agreement between the Company,
DCL, the Major Shareholders and any one of the Investors and in the case of
Conditions 2.1.3 to 2.1.9 waived in writing by any one of the Investors) on
or before the Cut-off Date, then this Agreement (other than Clauses 8, 9,
10, 11 and 12) shall automatically terminate and the parties shall have no
further obligations under this Agreement other than in respect . of Clauses
8, 9, 10, 11 and 12 but without prejudice to any accrued liabilities.
2.5 Save for as required in furtherance of completion of the Restructuring and
as expressly contemplated under the terms of this Agreement, at all times
prior to the Completion Date, the Company, DCL, the PRC Company and each of
the Major Shareholders undertake to the Investors that, subject to
compliance with all applicable laws and regulations, no Group Member shall
without the prior consent of any one of the Investors (such consent not to
be unreasonably withheld or delayed):
2.5.1 enter into any merger or consolidation of any Group Member with one
or more entities;
2.5.2 commence liquidation, unwinding or dissolution of any Group Member,
or the filing of bankruptcy or similar proceedings;
2.5.3 dispose of, either singly or in a series of transactions,' any assets
or property (other than in the ordinary course of business) owned by
any Group Member with a cumulative value of more than RMB100 million;
2.5.4 make any amendments (by merger or otherwise) to any Group Member's
articles of association or other constitutional documents save for any
incidental amendments required to be made to the articles of
association of the PRC Company in connection with operating matters in
the ordinary course of business, provided that the scope or
consequences of such amendments are not
likely to directly or indirectly circumvent or alter the rights of the
Investors or the approval rights of the Investors hereunder;
2.5.5 make any change to the authorized or issued share capital (including
the issuance of options or other rights to subscribe for such share
capital) of any Group Member;
2.5.6 amend (by merger or otherwise) the rights, preferences, privileges or
powers of the Convertible Redeemable Preference Shares;
2.5.7 retain any external professional advisor other than a Big 4
accounting firm to provide Tax advisory services to the Group or to
assist in the preparation of Tax returns;
2.5.8 enter into any transaction or series of related transactions, which
has as an objective and/or the effect of securing a Tax benefit;
2.5.9 implement any Tax-motivated restructuring of the Group or of the
business, operations or practices thereof;
2.5.10 adopt any share option or share incentive scheme or employee share
trust or share ownership plan;
2.5.11 declare any dividends or other distribution with respect to any
equity security;
2.5.12 take out any loan or incur any indebtedness in excess of RMB 100
million, whether in a single transaction or a series of related
transactions which occur within a three-month period;
2.5.13 make any capital commitment with an aggregate value in excess of
RMB100 million, whether in a single transaction or a series of related
transactions, by any Group Member unless such commitment has already
been approved;
2.5.14 conduct any transaction or series of transactions in excess of RMB2
million with a Major Shareholder (or any of its Affiliates or Family
Members) or a director of a Group Member or an Associate of any such
director;
2.5.15 make any change in any Group Member's auditors;
2.5.16 make any material changes to any Group Member's annual budget
(including the Annual Budget);
2.5.17 grant any security over any material assets of any Group Member or
extend a loan to or guarantee any loans for any party which is not a
Group Member; or
2.5.18 make any loan or advance to any person, firm, body corporate - or
other business other than in the normal course of business and on an
arm's length
2.6 At all times prior to the Completion Date, the Company, DCL, the PRC
Company and each of the Major Shareholders undertake to the Investors that:
2.6.1 it shall promptly disclose to any one of the Investors all relevant
information which comes to its attention in relation to any fact or
matter (whether existing on or before the date of this Agreement or
arising afterwards) which may constitute a material breach of this
Agreement or of any Warranty if the Warranties were to be repeated on
or at any time before Completion by reference to the facts and
circumstances then existing as if references in the Warranties to the
date of this Agreement were references to the relevant date; and
2.6.2 it shall fully notify and consult with the Investors, or procure that
the Investors are fully notified and consulted with, in relation to
any matters which may result in a Material Adverse Change.
3. COMPLETION
3.1 Completion will take place at the offices of Xxxxxxxx Chance in Hong Kong
on the Completion, Date or at such other place as the parties may agree. At
Completion all of the following shall take place (to the extent that it has
not taken place prior to Completion):
3.1.1 the Investors shall subscribe for such number of Convertible
Redeemable Preference Shares set against its name in Clause 3.1.2 and
pay the corresponding amount of the Subscription Monies in cash in
clear and immediately available funds on the same date to such account
as may be designated by the Company in writing not less than 2
Business Days before the Completion Date;
3.1.2 against receipt of the Subscription Monies in full, the Company shall
issue and allot to each Investor such percentage of the total number
of Subscription Shares (credited as fully paid) set opposite its name
in accordance with the following breakdown and the Company shall enter
each Investor's name in the register of members of the Company;
Percentage of
Subscription Shares Portion of Subscription
Investor Subscribed Monies Payable in USS
-------- ------------------- -----------------------
GS CAPITAL PARTNERS V FUND, L.P. 52.6560 14,790,703
GS CAPITAL PARTNERS V OFFSHORE FUND, L.P. 27.1999 7,640,262
GS CAPITAL PARTNERS V GmbH & CO. KG 18.0565 5,071,945
Percentage of
Subscription Shares Portion of Subscription
Investor Subscribed Monies Payable in USS
-------- ------------------- -----------------------
GS CAPITAL PARTNERS V INSTITUTIONAL, L.P. 2.0876 586,392
3.1.3 a person to be designated by the Investors shall be appointed to the
Board as the Investor Director;
3.1.4 the Investors shall purchase and the Major Shareholders shall sell
such percentage of the total number of Secondary Shares set out
against its name below and the Investors shall pay the corresponding
amount of the Secondary Sale Amount in cash in clear and immediately
available funds on the same date to an account designated by the Major
Shareholders in writing not less than 2 Business Days before the
Completion Date:
Percentage of Secondary Portion of Secondary Sale
Investor Shares Purchased Amount Payable in US$
-------- ----------------------- -------------------------
GS CAPITAL PARTNERS V FUND, L.P. 52.6560 4,181,131
GS CAPITAL PARTNERS V OFFSHORE FUND, L.P. 27.1999 2,159,799
GS CAPITAL PARTNERS V GmbH & CO. KG 18.0565 1,433,770
GS CAPITAL PARTNERS V INSTITUTIONAL, L.P. 2.0876 165,765
3.1.5 the Investors shall purchase and DCL shall sell such percentage of
the total number of DCL Shares set out against its name below and each
Investor shall pay the corresponding amount of the DCL Amount in cash
in clear and immediately available funds on the same date to an
account designated by DCL in writing not less than 2 Business Days
before the Completion Date:
Percentage of DCL Portion of DCL
Investor Shares Purchased Amount Payable in US$
-------- ----------------- ---------------------
GS CAPITAL PARTNERS V FUND, L.P. 52.6560 2,090,566
Percentage of DCL Portion of DCL
Investor Shares Purchased Amount Payable in US$
-------- ----------------- ---------------------
GS CAPITAL PARTNERS V OFFSHORE FUND, L.P. 27.1999 1,079,899
GS CAPITAL PARTNERS V GmbH & CO. KG 18.0565 716,885
GS CAPITAL PARTNERS V INSTITUTIONAL; L.P. 2.0876 82,883
3.1.6 the Company shall deliver to the Investors:
(a) the Shareholders' Agreement and the Registration Rights Agreement
duly executed by all the parties thereto except the Investors and
if the Major Shareholders hold Shares through a corporate entity,
deeds of adherence to the Shareholders' Agreement and this
Agreement will be executed by each such entity and delivered by
the Company, the effect of which will be that each such entity
will accede to all the obligations of the relevant Major
Shareholder in the Shareholders' Agreement and under thin
Agreement;
(b) subject to receipt of payment of the Subscription Monies in full
or a copy of irrevocable wire instructions to the Investors' bank
for the remittance of the Subscription Monies, share
certificate(s) for the Convertible Redeemable Preference Shares
in the name of the Investors as set out in Clause 3.1.2; and
(c) share certificates for the Secondary Shares as set out in Clause
3.1.4;
(d) share certificates for the DCL Shares as set out in Clause 3.1.5;
3.1.7 the Investors shall deliver:
(a) to the Company the Shareholders' Agreement and the Registration
Rights Agreement duly executed by all the Investors; and
(b) written authorisation confirming each Investor's authority to
enter into this Agreement and the Other Documents, and the
consummation of the transactions contemplated herein; and
(c) a copy of irrevocable wire transfer instructions to the
Investors' bank for the remittance of the Subscription Monies,
the Secondary Sale Amount and the DCL Amount;
3.1.8 the Major Shareholders shall deliver:
(a) to the Company their existing share certificates in relation to
the Secondary Shares; and
(b) to the relevant Investor an instrument of transfer, duly executed
in favour of the Investors to reflect the Secondary Shares being
transferred to each Investor in accordance with and as set out in
Clause 3.1.4;
3.1.9 DCL shall deliver to the Company their existing share certificate in
relation to the DCL Shares and shall deliver to the relevant Investor
an instrument of transfer, duly executed in favour of the Investors to
reflect the DCL Shares being transferred to each Investor in
accordance with and as set out in Clause 3.1.5; and
3.1.10 The parties shall instruct Xxxxxxxx Chance, Hong Kong to deliver to
Law Debenture Corporation (or some other escrow agent) the Escrowed
Share Transfer Instruments and the Escrowed Share Certificates.
3.2 The obligations of each of the Investors pursuant to Clause 3.1.1, Clause
3.1.4 and Clause 3.1.5 shall be joint and several as between all of the
Investors, such that if any one of the Investors default in their
obligations under Clause 3.1.1, Clause 3.1.4 or Clause 3.1.5, the
non-defaulting Investors are jointly and severally liable to perform the
obligations of the defaulting Investor thereunder. Without prejudice to the
Company's rights pursuant to Clause 3.3, the Company, DCL and the Major
Shareholders are not obliged to complete this Agreement unless each
Investor complies with all of its obligations under this Clause 3.
3.3 Neither the Investors, the Company, the Major Shareholders nor DCL shall be
obliged to complete the issue of the Subscription Shares or the sale and
purchase of the Secondary Shares and DCL Shares unless the issue of the
Subscription Shares and the sale and purchase of the Secondary Shares and
DCL Shares are completed simultaneously.
3.4 If Completion does not take place in accordance with Clause 3.1 because
either the Company, DCL, the Major Shareholders or any one of the Investors
fails to comply with any of its obligations under this Clause 3 by or on
the Completion Date, the Company, DCL and the Major Shareholders (in the
case of such failure of an Investor) or the Investors (in the case of such
failure of the Company, DCL and the Major Shareholders) may, without
prejudice to other remedies, by notice to the other:
3.4.1 proceed to Completion to the extent reasonably practicable;
3.4.2 postpone Completion to a date not more than 30 days after the date
set for Completion in Clause 3.1 or any other date to be mutually
agreed between the parties in writing; or
3.4.3 terminate this Agreement (other than Clauses 8, 9, 10, 11 and 12)
whereupon the parties shall have no further obligations under this
Agreement other than in
respect of Clauses 8, 9, 10, 11 and 12 but without prejudice to any
accrued liabilities.
3.5 In accordance with the terms of the Instruction Letter to Xxxxxxxx Chance
in the agreed form, the Investors' legal or other advisers and the
Investors or their representatives shall be entitled, prior to the date of
Completion, to inspect at the offices of Xxxxxxxx Chance, Hong Kong all
documents to be delivered by the Major Shareholders', DCL and the Company
under this Clause 3.
4. USE OF PROCEEDS
The Company shall use the Subscription Monies received by it from the
Investors pursuant to Clause 3.1.1 for general working capital purposes,
expanding new business lines, expanding production capacity for medical
equipment, research and development, acquisition of business or assets, or
otherwise in connection with the operation or development of the business
of the Group or if appropriate; for facilitating the Restructuring or as
shareholder loans to other Group Members, or use such money to subscribe
for shares in any Group Member or for any other purposes, save that the
proceeds of the subscription monies are not to be distributed to
shareholders of the Company or any Group Member unless with the prior
consent of any one of the Investors.
5. WARRANTIES
5.1 Each of the Warrantors hereby severally, and not jointly and severally,
warrants, to the Investors that each of the Warranties is true, accurate
and not misleading at the date of this Agreement and as at the Completion
Date by reference to the facts and circumstances as at that date.
5.2 Each of the Warranties is separate and independent and the Investors shall
have a separate claim and right of action in respect of every breach.
Subject to Clause 5.5.5, the Warranties shall continue in full force and
effect after Completion.
5.3 Each of the Warranties is given subject to the matters fully and fairly
disclosed in the Disclosure Letter and by any matter expressly contemplated
under the terms of this Agreement or as required in furtherance of
completion of the Restructuring.
5.4 A reference in Schedule 3 to the Warrantors' knowledge, information, belief
or awareness, means the actual knowledge, information, belief or awareness
which a Warrantor has as at the date of this Agreement, provided that the
Warrantors shall be deemed to have constructive knowledge if any Warrantor
should reasonably be expected to possess such knowledge, information,
belief or awareness after making all reasonable enquiries.
5.5 Save for any Warranty Claim arising (or any delay in the discovery of which
arises) as a result of fraud, wilful misrepresentation or gross negligence
on the part of the relevant Warrantor:
5.5.1 the aggregate liability of the Warrantors to the Investors for all
Warranty Claims made by either one or all of the Investors shall not
exceed US$40,000,000;
5.5.2 in respect of each Warrantor (except the Company whose aggregate
liability for all Warranty Claims shall not exceed US$28,089,302), the
aggregate liability of a Warrantor for all Warranty Claims shall not
exceed the amount set opposite his or its name in the relevant column
of Schedule 1 Part A;
5.5.3 the liability of each Warrantor (except the Company whose liability
in respect of any Warranty Claim for which it is liable shall not
exceed 70% of the relevant Warranty Claim) in respect of any Warranty
Claim for which he/it is liable shall not exceed the proportion of the
relevant Warranty Claim which equals the proportion set opposite his
or its name in the relevant column of Schedule 1;
5.5.4 no Warrantor shall be liable in respect of a Warranty Claim unless
the total amount of one or more Warranty Claim(s) exceeds
US$1,000,000;
5.5.5 the Warrantors shall not be liable in respect of a Warranty Claim
unless
(a) written particulars thereof (stating in reasonable detail the
nature of the Warranty Claim) shall have been notified in writing
to each of them on or before the date which is the earlier of:
(i) three years after the date of completion; and
(ii) three months after the publication of the audited
consolidated accounts of the Group for the first financial
year after Listing; or
(iii) in relation to a Warranty Claim brought pursuant to the
Warranties set out in paragraph 7 of Schedule 3, written
particulars thereof shall have been notified in writing to
each of them on or before the expiration of all applicable
statutes of limitation with respect to the matters contained
in paragraph 7 of Schedule 3; and
(b) if the relevant Warranty Claim notified in accordance with Clause
5.5.5(a) has not been satisfied, settled or withdrawn,
proceedings in respect of the Warranty Claim shall have been
commenced in accordance with Clause 12 within two months of the
expiry of the notice of the dispute served in accordance with
Clause 12.2;
5.5.6 the Warrantor shall not be liable in respect of a Warranty Claim to
the extent that any Group Member recovers any sum (whether by payment,
discount, credit or otherwise) from any third party in respect of any
matter or event which could give rise to such Warranty Claim against
the Warrantors hereunder, and any such sum has been recovered; and, in
the event of such recovery occurring after the Warranty Claim has been
satisfied by the Warrantors, the Investors shall account
to the Warrantors in respect of its pro-rated share of any amount so
recovered up to the amount of the Warranty Claim;
5.5.7 no liability shall attach to any of the Warrantors in respect of any
Warranty Claim:
(a) to the extent that provision or reserve in respect of the matter
giving rise to such Warranty Claim has been provided for or noted
in the Accounts or that such matter or thing has been taken into
account therein;
(b) if such Warranty Claim would not have arisen but for a change in
the rate of Tax or a change in legislation made after the date
hereof or a change in the interpretation of the law after the
date hereof or a change by the relevant Tax Authority in the
method of applying or calculating the rate of Tax after the date
hereof or a change in any extra statutory concession or practice
previously made by any revenue authority (whether or not such
change purports to be effective retrospectively in whole or in
part) or if such Warranty Claim would not have arisen but for any
judgment delivered after the date hereof;
(c) to the extent that such Warranty Claim would not have arisen but
for a change (excluding any change self imposed by the Group) in
the treatrnent of assets and liabilities (including capital
allowances) in the future accounts of the Group; or
(d) to the extent. that the amount thereof corresponds to an increase
in the value of the assets of any other Group Member (minority
interests shall be taken into account for this purpose) resulting
from a reduction in its liability to Tax except insofar as such
increase is attributable to any decrease in rates of Tax, or
variation by the relevant Tax Authority in the method of applying
or calculating the rate of Tax, made after the date of
Completion.
5.6 All payments made by any party under this Clause 5 shall be made gross,
free of right of counterclaim or set off and without deduction or
withholding of any kind. If any deduction or withholding is required by
law, the Warrantor making the payment shall be obliged to pay the Investors
such additional sum (on a grossed-up basis) as will, after all deductions
or withholdings have been made, leave the Investors with the same amount as
it would have been entitled to receive in the absence of any such
requirement to make a deduction or withholding.
5.7 The provisions of Clauses 5.6 to 5.10 apply notwithstanding any other
provision of this Agreement and will not be discharged or cease to have
effect in consequence of any rescission or termination of any other
provisions of this Agreement.
58 Nothing in this Clause 5 shall limit or restrict an Investor's general
obligation at law to mitigate any loss or damage which it may incur in
consequence of any matter giving rise to a Warranty Claim.
5.8 Nothing in this Clause 5 shall have the effect of limiting or restricting
any liability as a result of any fraud, wilful misconduct or gross
negligence.
5.9 No Major Shareholder shall have any right of contribution from the Company
or the PRC Company or other recourse against the Company or the PRC Company
in respect of any liability such Major Shareholder may incur hereunder.
5.10 Each of the Warrantors shall indemnify the Investors and the Company for
any Tax liability (save as disclosed in the Accounts) arising in respect
of, by reference to or in consequence of (i) any income, profit or gains
earned, accrued or received on or before the Last Accounting Date or (ii)
any event which occurs or occurred on or before the Last Accounting Date.
6. AUTHORITY AND CAPACITY
6.1 Each of the Company, DCL, the PRC Company and the Major Shareholders
represents, warrants and undertakes to and with the Investors that the
execution and delivery of, and the performance by it of its obligations
under, this Agreement and the Other Documents, as applicable, in accordance
with and subject to the terms and conditions of this Agreement including,.
without limitation, the Conditions will not result in a breach of any
provision of its memorandum or article', of association or equivalent
constitutional documents.
6.2 Each Investor represents, warrants and undertakes to and with the Company,
DCL and the Major Shareholders that:
6.2.1 it is a limited partnership duly established and validly existing
under the laws of its jurisdiction of establishment;
6.2.2 it has the legal right and full power and authority to enter into and
perform this Agreement and the Other Documents, which when executed
will constitute valid and binding obligations on it, in accordance
with their respective terms;
6.2.3 the execution and delivery of, and the performance by it of its
obligations under, this Agreement and the Other Documents in
accordance with and subject to the terms and conditions of this
Agreement including, without limitation, the Conditions will not
result in a breach of any provision of its memorandum or articles of
association or equivalent constitutional documents; and
6.2.4 all of the information contained in Part B of Schedule 1 is true and
accurate in all respects.
7. COSTS AND FEES
Upon Completion, the Company shall pay for the professional fees, costs and
expenses reasonably and actually incurred by the Investors, up to a maximum
amount of US$250,000 and shall not be responsible for any professional fees
exceeding such sum.
Subject to production of proof, such professional fees shall be deducted
from the Subscription Monies payable by the Investors on Completion.
8. ANNOUNCEMENTS
Except as required by law, regulation or legal process, no announcement in
relation to the transactions contemplated by this Agreement shall be made
without the prior consent of any one of the Investors in the case of an
announcement by either any one of the Major Shareholders, the Company or
DCL and in the case of an announcement by any one of the Investors not
without the prior consent of any one of the Major Shareholders, DCL and the
Company.
9. NOTICES AND OTHER COMMUNICATIONS
9.1 Any notice or other communication under or in connection with this
Agreement shall be in writing and shall be delivered personally or sent by
registered post in a pre-paid envelope (and air mail in the case of an
address outside Hong Kong) or by facsimile, to the party due to receive the
notice or communication at its address set out in Clause 9.3 or such other
address as a party may specify by notice in writing to the others.
9.2 In the absence of evidence of earlier receipt, any notice or communication
shall be deemed to have been duly given:
9.2.1 if delivered personally, when left at the address stated in Clause
9.3 (or where such time is outside the normal business hours of the
recipient, on the opening of the next following Business Day);
9.2.2 if sent to an address in Hong Kong, on the Business Day after posing
it,
9.2.3 if sent by air mail to an address outside Hong Kong, five Business
Days after posting it; and
9.2.4 if sent by facsimile, when confirmation of its transmission has been
recorded by the sender's fax machine (or where such time is outside
the normal business hours of the recipient, on the opening of the next
following Business Day).
9.3 The addresses referred to in Clause 9.1 are:
THE MAJOR SHAREHOLDERS
Address: Mindray Building, Keji 12th Road South,
Hi-tech Industrial Park, Nanshan,
Shenzhen, PRC, 518057
Attention: Xu Hang/Li Xiting/Xxxxx Xxxxxx
Facsimile No: x00 000 0000 0000
DCL
Address: XXX Xxxxxxxx, X.X. Xxx 0000, Xxxx Xxxx, Xxxxxxx, Xxxxxxx
Virgin Islands
Attention: Xxxx Xxxx
Facsimile No: x00 000 0000 0000
THE INVESTORS
Address: Xxxxxxx Sachs (Asia) L.L.C., Xxxxxx Kong Center,
68 (Corrupted Text) Floor, 0 Xxxxx'x Xxxx
Xxxxxxx, Xxxx Xxxx.
Attention: Xxxxx Xxx
Facsimile No: x000 0000 0000
COMPANY
Address: Mindray Building, Keji 12th Road South,
Hi-tech Industrial Park, Nanshan,
Shenzhen, PRC, 518057
Attention: Xu Hang
Facsimile No: x00 000 0000 0000
10. CONFIDENTIAL INFORMATION
Subject to the provisions of this Clause 10, each party shall keep
confidential information (Corrupted Text) from the Company relating to the
Company's business and/or (Corrupted Text) affairs (Corrupted Text) the
Group and/or any information regarding the Major Shareholders or DCL (the
"CONFIDENTIAL INFORMATION") confidential unless:
10.1 that information comes into the public domain otherwise than throne: a bres
of that party's obligations under this Clause 10; or
10.2 such information is required to be disclosed by law, by. a rule of a
securities exchange on which that person's shares (or the shares of a
member of that person's Parent Group) are listed or traded or by a
governmental authority or other authority with relevant powers to which a
person (or a member of that person's Parent Gregp) is subject or submits,
whether or not the requirement has the force of law, provided that such
disclosure shall, so far as is practicable, be made after consultation with
the Company and after taking into account the Company's reasonable
requirements as to its timing, content and manner of making or despatch,
PROVIDED THAT each party may disclose Confidential Information when such
disclosure is required, to:
(a) members of that party's Parent Group;
(b) an employee or director of, or professional adviser, to any
member of that party's Parent Group; or
(c) any person to whom it is proposing to transfer shares in
accordance with the provisions of this Agreement,
(which disclosure shall be expressly permitted under the terms of
this Agreement) provided that the Party shall use reasonable
endeavours to ensure that the recipient of the Confidential
Information complies with the provisions of this Clause 10 and a
breach by the recipient is deemed to be a breach of the party
that
11. MISCELLANEOUS
11.1 The provisions of this Agreement shall be binding upon and accrue to the
benefit of the parties and their respective heirs, authorised
representatives, successors and assigns.
11.2 This Agreement may be amended only by a written document signed by all the
parties.
11.3 Any liability to any party hereunder may in whole or in part be released,
compounded or compromised or time or indulgence given by that party in
their absolute discretion as regards the other party under such liability
without in any way prejudicing or affecting the rights of the party to whom
such liability is owed against any such other party subject to the same or
a like liability whether joint or several or otherwise.
11.4 Nothing contained in this Agreement shall be deemed to constitute a
partnership between the parties and the parties shall not be deemed to be
connected with each other solely because they are parties to this
Agreement.
11.5 No failure to exercise or delay in exercising or enforcing- any right or
remedy under this Agreement shall constitute a waiver thereof and no single
or partial exercise or enforcement of any right or remedy under this
Agreement shall preclude or restrict the. further exercise or enforcement
of any such right or remedy. The rights and remedies provided in this
Agreement are (Corrupted Text) and not exclusive of (Corrupted Text) and
remedies provided by law.
11.6 The invalidity, illegality or unenforceability of any provision of this
Agreement shall not affect the continuation in force of the remainder of
this Agreement.
11.7 This Agreement may be executed in any number of counterparts all of which
duly executed and delivered shall constitute the same instrument.
11.8 None of the parties to this Agreement may assign or transfer any of its
rights or obligations under this Agreement with the exception that a party
may assign all rights and obligations under this Agreement to a transferee
in connection with a Permitted Transfer.
12. GOVERNING LAW AND ARBITRATION
12.1 This Agreement shall be governed by and construed in accordance with the
laws of Hong Kong.
12.2 If any dispute between the parties arises in connection with this
Agreement, they shall use all reasonable endeavours to resolve the matter
amicably. If one party gives another notice that a material dispute has
arisen and those parties are unable to resolve the dispute
within 30 days of service of notice, then the dispute shall be referred to
arbitration in accordance with Clause 12.3.
12.3 All disputes arising out of or in connection with this Agreement shall be
finally settled under the Rules of Arbitration of the International Chamber
of Commerce by three arbitrators appointed in accordance with the said
Rules. The arbitration institute shall be the International Court of
Arbitration of the International Chamber of Commerce. The place of
arbitration shall be in Hong Kong. The language of the arbitration shall be
English.
13. PREVIOUS AGREEMENTS
The parties acknowledge that this Agreement will replace any agreement
(whether in writing or not) entered into by any party relating to the
Company or shareholdings in the Company.
AS WITNESS the hands of the parties or their duly authorised representatives the
day nd year first above written.
SCHEDULE 1
PART A - THE MAJOR SHAREHOLDERS
(I) (2) (3)
NAME AND IDENTITY NUMBER (IF PROPORTION OF ANY CLAIM UNDER THE MAXIMUM AGGREGATE LIABILITY UNDER
APPLICABLE) WARRANTIES FOR WHICH IT IS LIABLE THE WARRANTIES
---------------------------- --------------------------------- ---------------------------------
Xu Hang 6% US$2,382,140
No. 440301196205186972
Li Xiting 12% US$4,764,279
No. 420106510617441
Xxxxx Xxxxxx 2% US$794,047
No. 310104611009045
DCL 10% US$3,970,233
PART B - THE INVESTORS
1. GS CAPITAL PARTNERS V FUND, L.P.
- nature (e.g. limited
liability company): Limited partnership
- place of incorporation: Delaware
- registered office: The Corporation Trust Company,
Corporation Trust Center, 0000 Xxxxxx
Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, XXX
- relationship with other
Investors: General Partner:
Affiliates of the Xxxxxxx Sachs Group,
Inc.
2. GS CAPITAL PARTNERS V OFFSHORE FUND, LP.
- nature (e.g. limited
liability company): Limited partnership
- place of incorporation: Cayman Islands
- registered office: c/o M&C Corporate Services Limited, P.O.
Box 309, Grand Cayman, Cayman Islands,
British West Indies
- relationship with other
Investors: General Partner:
Affiliates of the Xxxxxxx Xxxxx Group,
Inc.
3. GS CAPITAL PARTNERS V GmbH & CO. KG
- nature (e.g. limited
liability company): Limited partnership
- place of incorporation: Germany
- registered address: c/o Goldman, Sachs & Co., OHG,
Messeturm, Xxxxxxxxx-Xxxxx-Xxxxxx, 00,
00000 Xxxxxxxxx/Xxxx Xxxxxxx
- relationship with other
Investors: General Partner:
Affiliates of the Xxxxxxx Sachs Group,
Inc.
4. GS CAPITAL PARTNERS V INSTITUTIONAL, L.P.
- nature (e.g. limited
liability company): Limited partnership
- place of incorporation: Delaware
- registered office: The Corporation Trust Company,
Corporation Trust Center, 0000 Xxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, XXX
- relationship with other
Investors: General Partner:
Affiliates of the Xxxxxxx Xxxxx Group,
Inc.
SCHEDULE 2
PART A - DETAILS OF THE GROUP
A. THE COMPANY
1. Company number CT-150186
2. Address of registered office c/o Codan Trust Company (Cayman)
Limited, Century Yard, Cricket
Square, Xxxxxxxx Drive, P.O. Box
2681 GT, Xxxxxx Town, Grand Cayman,
British West Indies
3. Date and place of incorporation 10 June 2005
Cayman Islands
4. Ar,horised share capital HK$380,000
5. Issued share capital HK$0.01
6. Directors Xu Xxxx
Xx Xiting
7. Auditors Deloitte Touche Tohinatsu
B. PRC COMPANY
1. Company number Qi Gu Xxx Xxxx Zong Zi No. 109722
2. Address of registered office Mindray Building, Keji 12th Road
South, Hi-tech Industrial Park,
Nanshan, Shenzhen, PRC, 818057
3. Date and place of incorporation 25 January 1999
Xxxxxxxx, XXX
0. Authorised share capital RMB86,000,000
5. Issued share capital RBM86,000,000
6. Directors Xu Xxxx
Xx Xiting
Nie Xxxx
Xxxx Fuqing
Dai Xxxxxxx
Xxxxx Shaokang
Xxxxxx Xxxxx
7. Auditors Deloitte Touche Tohinatsu
C. Beijing Shen Mindray Medical Electronic Technology Institute Co., Ltd.
1. Company number 1101081782163
2. Address of registered office 5-5 (31F West), Block 0, 0 Xxxxxx
Xx Xxxx, Xxxxxxx Xxxxxxxx, Xxxxxxx
XXX
0. Date and place of incorporation 6 December 2004
Beijing, PRC
4. Authorised share capital RMB10,000,000
5. Issued share capital RMB10,000,000
6. Directors Li Xiting
7. Auditors N/A
D. GREATEST ELITE LIMITED
1. Company number 565901
2. Address of registered office X.X. Xxx 000, (Corrupted Text)
Incorporations Centre, Road Town,
Tortola, British Virgin Islands
3. Date and place of incorporation 28 October 2003
British Virgin Islands
4. Authorised share capital US$50,000
5. Issued share capital US$10
6. Directors Xu Hang
7. Auditors N/A
E. GIANT GLORY INVESTMENTS LIMITED
1. Company number 565616
2. Address of registered office P.O. Box 957, Offshore
Incorporations Centre, Road Town,
Tortola, British
Virgin Islands
3. Date and place of incorporation 28 October 2003
British Virgin Islands
4. Authorised share capital US$50,000
5. Issued share capital US$10
6. Directors Li Xiting
7. Auditors N/A
PART B - DETAILS OF DCL
A. DRAGON CITY INTERNATIONAL INVESTMENT LIMITED
1. Company number 582231
2. Address of registered office OMC Xxxxxxxx, P.O. Box 3152, Road
Town, Tortola , British Virgin
Islands
3. Date and place of incorporation 18 February 2004 British Virgin
Islands
4. Authorised share capital US$50,000
5. Issued share capital US$1
6. Directors Xxx Xxx Yu
7. Auditors N/A
SCHEDULE 3
WARRANTIES
1. INFORMATION
1.1 All written information save for any projections or forecasts, provided by
the Warrantors to the Investors or their representatives or advisers in
their due diligence investigations of the Group, was when given, and is at
the date hereof, true and correct in all material respects.
1.2 For the avoidance of doubt, other than as disclosed pursuant to the
Disclosure Letter and by any matter expressly contemplated for under the
terms of this Agreement or as required in furtherance of completion of the
Restructuring, none of the documents or other information disclosed to the
Investors or their representatives or advisers shall be deemed to qualify
the Warranties set out in this Schedule 3.
2. CAPACITY AND AUTHORITY
2.1 Incorporation and existence
The Company, DCL and the PRC Company are limited companies duly
incorporated or established under the laws of the jurisdictions set out in
items 3 of Schedule (Corrupted Text) A and B and have been in continuous
existence since incorporation or establishment. The foreign investment
enterprise approval certificate and business licence of the PRC Company are
in full force and effect as are the business licenses and constitutent
documents of the other Group Members, branch establishments and
representative offices established in the PRC.
2.2 Right, power and authority
2.2.1 Each of the Company, DCL, the PRC Company and the Major Shareholders
has the right, power and authority, and has taken all action necessary
(including obtaining all applicable governmental, statutory,
regulatory or other consents, licenses, authorizations, waivers or
exemptions), to execute, deliver and exercise its rights, and perform
its obligations, under this Agreement and each document to be executed
by it at or before Completion.
2.2.2 Each Group Member has the right, power and authority to conduct in
accordance with laws its business as conducted at the date of this
Agreement and to own its properties and assets.
2.3 Binding agreements
The obligations of the Company, DCL and each Major Shareholder under this
Agreement and each document to be executed by it at or before Completion
are, or when the relevant document is executed will be, enforceable in
accordance with their respective terms.
2.4 Non-contravention
2.4.1 Neither entry into this Agreement nor entry into, and implementation
of the transactions contemplated hereunder will:
(a) result in violation or breach by the Company, DCL, the PRC
Company or any Major Shareholders of any applicable laws,
regulations or administrative rules or orders in the PRC;
(b) amount to a violation or default by the Company, DCL, the PRC
Company or any Major Shareholders with respect to any statute,
regulation, order, decree or judgment of any court or any
governmental or regulatory authority in the PRC; or
(c) constitute a breach by the Company, DCL, the PRC Company or any.
Major Shareholders of any contract, agreement, undertaking or
commitment to which any Group Member or Major Shareholder is a
party,
provided that no warranty is made regarding the enforceability of this
Agreement against the PRC Company yr whether the provision of
warranties by the PRC Company contravenes PRC (Corrupted Text).
2.4.2 Other than as referred to in this Agreement, no consents, (Corrupted
Text), registrations, authorizations or pen:a are required to be
obtained by any Group Member or Major Shareholder in connection with
the execution and performance of this Agreement.
2.5 Special Purpose Entity
The Company and each of its subsidiaries has not had and will not have any
assets (excluding cash) other than its ownership of the registered capital
of the PRC Company and has conducted no business and assumed no liabilities
other than its obligations under this Agreement and in respect of the
acquisition of shares in the PRC Company.
3. SHARES AND SUBSIDIARY UNDERTAKINGS
3.1 The Shares
3.1.1 The Subscription Shares when allotted and issued, in accordance with
the terms of this Agreement will upon Completion be duly and validly
authorised, properly allotted and issued to the Investors free from
all Encumbrances, credited as fully paid and will have all the rights
set out in the Terms and Conditions.
3.1.2 The Secondary Shares and DCL Shares will be properly allotted and
issued and will upon Completion be credited as fully paid and will be
transferred to the Investors free from all Encumbrances.
3.1.3 Save for the acquisition of shares in the PRC Company pursuant to the
Restructuring, there is no agreement, arrangement or obligation
requiring the creation, allotment, issue, transfer, redemption or
repayment of, or the grant to a person of the right (conditional or
not) to require the allotment, issue, transfer, redemption or
repayment of, a share in the capital of any Group Member (including,
without limitation, an option or right of pre-emption or conversion).
3.1.4 Save for the Shareholders' Agreement, there is no agreement,
arrangement or obligation to create or give an Encumbrance, in
relation to any Equity Share Capital or other share capital (either
issued or unissued) of the Company or the Company's interest in the
registered capital of the PRC Company. No person has claimed to be
entitled to an Encumbrance in relation to any of the Equity Share
Capital or other share capital of the Company or the Company's
interest in the registered capital of the PRC Company. There are no
securities convertible into or ultimately exchangeable or exercisable
for any Equity Share Capital or other share capital of any Group
Member.
3.1.5 Immediately prior to Completion the Major Shareholders shall directly
or indirectly hold a (Corrupted Text) minimum of 50% of the entire
issued share capital of the Company.
3.1.6 The Company shall upon Completion hold, directly or indirectly, a
minimum of 80% of the registered capital of the PRC Company.
3.2 Subsidiary Undertakings
3.2.1 The Company and the PRC Company do not have any subsidiaries or
Associates other than those set out in Schedule 2 Part A.
3.2.2 The Company has not agreed to acquire an interest in or merge or
consolidate with, a corporate body or any other person other than the
Group Members.
3.2.3 Minority shareholders in the PRC Company have no rights other than
those required under PRC law or as set out in the articles of
association of the PRC Company.
4. LIABILITIES
4.1 Indebtedness
4.1.1 No Group Member has outstanding or has agreed to create or incur loan
capital, borrowings or indebtedness in the nature of borrowings, other
than (i) as shown in the Accounts or (ii) as incurred since the Last
Accounting Date in the ordinary course of its business which as of
Completion do not exceed in aggregate RMB30,000,000.
4.1.2 No financial indebtedness of any Group Member has become or is now
due and payable, or capable of being declared due and payable, in each
case before its
normal or originally stated maturity, and there has been no event of
default in relation to any such financial indebtedness.
4.2 Guarantees and indemnities
4.2.1 No Group Member is a party to or is liable under a guarantee,
indemnity or other agreement to secure or incur a financial or other
obligation with respect to another person's obligation other than for
a Group Member.
4.2.2 No part of the loan capital, borrowings or indebtedness in the nature
of borrowings of the Company or the PRC Company is dependent on the
guarantee or indemnity of, or security provided by, another person
which is not a Group Member.
4.3 No loans have been made by or on behalf of any Group Member to any director
or shareholder of a Group Member other than as disclosed in the Accounts.
5. ACCOUNTS
5.1 The Accounts have been prepared and audited on a proper and consistent
basis and in accordance with the Accounting Principles.
5.2 No change in (Corrupted Text) the accounts of the PRC Company for each of
the three financial ears of the (Corrupted Text) Company ended on the Last
Accounting Date, except as stated in the audited balance sheets and profit
and less accounts for those years.
5.3 The Accounts show a true and fair view of the assets, liabilities and state
of affairs of the PRC Company as at the Last Accounting Date and of the
profits and losses of the PRC Company for the financial year ended on the
Last Accounting Date.
5.4 The Accounts fully disclose and provide adequately for all bad and doubtful
debts, all liabilities (actual, contingent or otherwise) and all financial
commitments existing at the Last Accounting Date.
6. CURRENT TRADING
6.1 Since the Last Accounting Date:
6.1.1 the business and activities of the PRC Company have been carried on
in the ordinary and usual course as a going concern;
6.1.2 there has been no Material Adverse Change in the financial or trading
position or earnings, business or prospects of the PRC Company since
the Last Accounting Date;
6.1.3 no material changes other than in the ordinary course of business
have occurred in the assets and liabilities shown in the Accounts;
6.1.4 no dividend or other distribution has been declared, paid or made by
any Group Member (except for dividends provided for in the Accounts);
6.1.5 no share or loan capital has been issued or agreed to be issued by
any Group Member;
6.1.6 all transactions between a Group Member and any Major Shareholder
have been on an arm's length terms;
6.1.7 no contract, liability or commitment (whether in respect of capital
expenditure or otherwise) has been entered into by a Group Member
which is of a long-term or unusual nature which involved or (Corrupted
Text) could involve, singly or cumulatively, an obligation of a
material nature or magnitude (a liability for expenditure in excess of
RMB50,000,000 being included as material for this purpose for any
contract, liability or commitment entered into prior to the date of
this Agreement and RMB100,000,000 for any contract, liability or
commitment entered into in the period from the date of this Agreement
up to (Corrupted Text);
6.1.8 no Group Member has (other than in the ordinary and usual course of
business) acquired or disposed of, or agreed to acquire or dispose of,
any business or any asset having a value in excess of RMB30,000,000;
or
6.1.9 with respect to the existing employees of a Group Member, no chance
has been made to their terms of employment, including retirement or
benefit commitments, by any Group Member (other than those required by
law) which could increase its total staff costs by more than
RMB20,000,000 per annum or the remuneration of any one director or
employee by more than RMB1,000,000 per annum.
7. TAX
7.1 As far as the Warrantors are aware the PRC Company has paid all Tax which
it has become liable to pay and is not liable to pay under the applicable
laws a penalty, surcharge, fine or interest in connection with Tax.
7.2 The Company and the PRC Company have within applicable time limits made all
returns, provided all information and maintained all records in (Corrupted
Text) relation to Tax as they are required to make under the applicable
laws, and have fully complied on a timely basis with all notices served on
them and any other requirements lawfully made of them by any Tax Authority.
7.3 As far as the Warrantors are aware the PRC Company is not involved in and
does not expect to be involved in any dispute in relation to Tax with any
Tax Authority. So far as the Warrantors are aware no Tax Authority has
investigated or indicated that it intends to investigate the PRC Company's
Tax affairs.
7.4 No Group Member will have any liability for Taxes in the PRC or any other
jurisdiction other than liabilities incurred in the ordinary course of
business between the Last Accounting Date and the date of this Agreement.
8. ASSETS
8.1 Title
8.1.1 Each asset included in the Accounts or acquired by the PRC Company
since the Last Accounting Date (other than assets disposed of in the
ordinary course of business or which are the subject matter of
operating or finance or capital leases) is:
(a) legally and beneficially owned solely by the PRC Company free
from any Encumbrance (other than retention of title claims or
liens arising in the ordinary course of business) and in the case
of real property and land use rights, the PRC Company is the
legal osiner and grantee of the land use rights (with all grant
fees paid in fell) in respect of such real property and has
building ownership certificates for such property; and
(b) where capable of possession, in the possession or under the
control of the PRC Company.
8.1.2 No Group Member is insolvent or unable to pay its debts as they fall
due.
9. INTELLECTUAL PROPERTY
9.1 As far as the Warrantors are aware, all of the Intellectual Property Rights
owned and/or used by the PRC Company in its business is:
9.1.1 valid, subsisting and enforceable and nothing has been done or
omitted to be done by which it may cease to be valid and enforceable;
and
9.1.2 either legally and beneficially owned by, and/or validly granted to
the PRC Company free from any licence, Encumbrance, restriction on use
or disclosure obligation.
9.2 So far as the Warrantors are aware, no act has been done or has been
omitted to be done to entitle any authority or person to cancel, forfeit or
modify any of the Intellectual Property Rights owned and/or used by the PRC
Company.
9.3 So far as the Warrantors are aware, the Intellectual Property Rights
currently owned and/or used by the PRC Company comprise all the
Intellectual Property necessary for the PRC Company to operate its business
as such business has been operated before the date of this Agreement.
9.4 So far as the Warrantors are aware, none of the operations of a Group
Member infringe, or are likely to infringe, upon any rights held by any
third party.
9.5 The Internal IT Systems are either owned by, or (Corrupted Text) properly
licensed or leased to, a Group Member. No Group Member is in material
default under the licenses or leases.
9.6 No claim has been made by any third party which alleges any infringing act
or process which would fall within this Warranty (Corrupted Text) or which
otherwise disputes the right of any Group Member to use any Intellectual
Property Rights relating to its business.
10. ENVIRONMENTAL MATTERS
10.1 So far as the Warrantors are aware, the PRC Company has:
10.1.1 obtained each permit, licence, consent, approval, registration or
other authorisation ("ENVIRONMENTAL PERMIT") required for its business
operations under any Environmental Law, and each Environmental Permit
is in full force and effect;
10.1.2 complied in all material respects with the terms and conditions on
which any Environmental Permit has beer given to it; and
10.1.3 complied in all material respects with any notification or claim
made within the two years ending on the date of this Agreement by any
relevant authority in respect of any breach of Environmental Law.
10.2 So far as the Warrantors are aware, the PRC Company is under no
investigation or enquiry by any relevant authority in relation to any
breach of Environmental Law or the failure to comply with the term: and
conditions of any Environmental Permit.
10.3 No Group Member is in material breach of any applicable statute, law,
regulation or order relating to the environment ("ENVIRONMENTAL LAW") and
no material expenditures are or will be required in order to comply with
any such Environmental Law, and so far as the Warrantors are aware there
are no circumstances which may give rise to any material non-compliance
with or material liability under any Environmental Law in relation to the
business of the Group.
11. AGREEMENTS
11.1 No Group Member is a member of a joint venture, consortium, partnership or
association (other than bona fide trade association) or profit (or loss)
sharing agreement or arrangement.
11.2 No Group Member is a party to and is not liable under any material,
long-term, onerous or unusual agreement or arrangement ("unusual" for the
purposes of this paragraph means an agreement or arrangement that involves
or is likely to involve either (i) expenditure by a Group Member in excess
of RMB50,000,000 per annum for agreements or arrangements entered into
prior to the date of this Agreement and RMB100,000,000 per annum for
agreements or arrangements entered into in the period from the date of this
Agreement up to Completion or (ii) obligations or restrictions on the Dart
of a Group Member of an unusual or exceptional nature and not in the
ordinary
11.3 So far as the Warrantors are aware, all subsisting material agreements
which any Group Member has entered into are valid, legal and binding and
were entered into by way of a bargain at arm's length.
11.4 So far as the Warrantors are aware, there are no circumstances whereby,
following a change in the control of any Group Member or in the composition
of the board of directors of a Group Member, any of the principal customers
of or suppliers to any Group Member would cease to remain customers or
suppliers to the same extent and of the same nature as prior to the date
hereof.
11.5 No Group Member has given any powers of attorney or other authority
express, implied or ostensible which is still outstanding or effective to
any person or entity to enter into any contract or commitment to do
anything on its behalf other than the authority of employees to enter into
routine trading contracts in the normal course of their duties.
11.6 No (Corrupted Text) Member nor so far as the Warrantors are aware, any
party with whom any Group Member has entered into an arrangement, agreement
or obligation is in material breach of the arrangement, agreement or
obligation.
11.7 There are no contracts, understandings, transactions or proposed
transactions between any Group Member on the one hand and any Major
Shareholder on the other hand. No Major Shareholder has any direct or
indirect ownership in any business entity with which any Group Member' has
a business relationship, or any business (Corrupted Text) that competes
with any Group Member, other than passive shareholdings of less then
(Corrupted Text) in publicly listed companies.
11.8 All insurance policies of each Group Member are in full force and effect
and are not void or voidable, all premiums payable to date have been paid
and each Group Member has complied in all material respects with the terms
and conditions of such pet
12. LITIGATION AND COMPLIANCE WITH LAW
12.1 No Group Member is involved in a civil, criminal, arbitration,
administrative or other proceeding or so far as the Warrantors are aware an
investigation (other than in relation to the collection of debts arising in
the ordinary course of business of a Group Member). So far as the
Warrantors are aware, no civil, criminal, arbitration, administrative or
other proceeding is pending or threatened by or against any Group Member
(other than in relation to the collection of debts arising in the usual
course of business).
12.2 So far as the Warrantors are aware, no fact or circumstance exists which
might give rise to a civil, criminal, arbitration, administrative or other
proceeding or investigation involving any Group Member.
12.3 So far as the Warrantors are aware, each Group Member has at all times
conducted its business and dealt with its assets in all material respects
in accordance with all applicable legal and administrative requirements.
12.4 So far as the Warrantors are aware, no Group Member has sold or supplied
any product or service which is or was in any material respect faulty,
defective or dangerous (unless inherently dangerous) or which did not at
the time of sale or supply comply with all applicable laws and regulations.
12.5 So far as the Warrantors are aware, no act or transaction has been effected
by or on behalf of any Group Member, nor any of their directors, officers
or senior management staff, involving the making or authorizing of any
payment, or the giving of anything of value, to any government official or
party official for the purpose of influencing the recipient in his official
capacity in order to obtain business, retain business or direct business to
any Group Member or other person.
13. EMPLOYEES
13.1 No Group Member has entered into any arrangements regarding any future
variation in any contract of employment in respect of any of its directors
and employees or any agreement imposing an obligation on a Group Member to
increase by an amount equivalent to RMB1,000,000 or more per annum, the
basis and/or rates of remuneration and/or the provision of other benefits
in kind to or on behalf of any of its directors or employees at any future
date.
13.2 Each Group Member has complied in all material respects with all applicable
statutes and regulations referring to employ and social welfare matters
including without limitation the terms and conditions of each employee's
employment.
13.3 Incentive Schemes
No Group Member has in existence any share incentive scheme, share option
scheme or profit sharing, bonus, commission or other incentive scheme for
all or any of its directors or any share option scheme for all or any of
its employees, miler than as set out under the Shareholders' Agreement.
13.4 Payments on Termination
Except to the extent (if any) to which provision or allowance has been made
in the Accounts:
(a) no liability in excess of RMB 1 million has been incurred by a
Group Member for breach of any contract of employment or for
services or for any other liability accruing from the termination
of any contract of employment or for services;
(b) no gratuitous payment has been made or benefit given (or promised
to be given) by a Group Member in connection with the actual or
proposed termination or suspension of employment, or variation of
any contract of employment, of any present or former director or
employee of a Group Member.
13.5 There is not in existence any written or unwritten contract of employment
with any employee that cannot be terminated by a Group Member on six months
notice or less without giving rise to a claim for damages or compensation
(other than a statutory redundancy payment or statutory compensation for
unfair dismissal) or, in either case, the equivalent in any relevant
jurisdiction.
13.6 No Key Employee has given notice which has not yet expired terminating his
or her employment or would be entitled to give notice as a result of this
Agreement.
14. MISCELLANEOUS
No shareholder in the PRC Company holding 5% or more of its registered
capital or Major Shareholder, their respective spouse, nor their respective
parents are a Government Official in the PRC or a member of the central
committee of the communist party of the PRC.
SCHEDULE 4
PRC COUNSEL OPINION MATTERS
1. The PRC Company has the right, power and authority to enter into and
perform its obligations under this Agreement, and this Agreement is legally
binding against the PRC Company.
2. All applicable PRC permits, approvals, registrations and filings required
to be obtained pursuant to the Restructuring have been obtained. The
Restructuring does not contravene PRC law or regulations.
3. Each of the Shareholders (as such term is defined in the Shareholders'
Agreement) has the right, power and authority to enter into and perform its
respective obligations under the Shareholders' Agreement and this
Agreement, if applicable, and such agreements are legally binding against
each of them.
4. Each (Corrupted Text) the PRC Company and its subsidiaries has been duly
incorporated (Corrupted Text) xxxxxx the laws (Corrupted Text) the PRC and
is entitled to conduct business pursuant to its business license, which
remains in full force and effect.
SCHEDULE 5
ANNUAL BUDGET
Proposal of 2004 Annual General Meeting of Shareholders: Explanations on the
2005 Annual Financial Budget Plan
(Draft)
2004 Annual General Meeting of Shareholders
of
Shenzhen Mindray Bio-medical Electronics Co., Ltd.
EXPLANATIONS ON 2005 ANNUAL FINANCIAL BUDGET PLAN (DRAFT)
In preparing the 2005 Annual Financial Budget Plan (Draft), the company has
implemented the guiding principle of increasing revenues and saving costs and
paid full attention to the following factors of uncertainty:
1. Pricing policy, increase of total sale volume and adjustment of sale
methods of existing products and new products of the company;
2. Continued implementation by the company in 2005 of the guiding
principle of arrangement of production and operation in line with
market demand;
3. Stability of the related national tax policies;
4. As a high-tech enterprise, in order to maintain high-speed growth and
enhance its core competence, the company will carry on large-amount
input into its core research and development. The research and
development expenses in 2005 will be increased from RMB 615.5 million
in 2004 to RMB 950.7 million.
In view of the above, the estimates of the major financial data in 2005 are as
follows:
in ten thousand yuan
2005 2004 Growth
Item Budget Final Account Rate
---- ------ ------------- ------
Revenues from principal business 98,744 65,485 50.79%
less: costs in principal business 44,900 27,772 61.68%
taxes in principal business
and extra charges 95 31
------ ------ ------
Profit from principal business 53,748 37,678 42.65%
plus: profit from other business 998 -874 14.20%
less: operating expenses 13,249 9,527 39.07%
management expenses 13,856 8,821 57.08%
R&D expenses 9,507 6,155 54.47%
financial expenses 525 56 809.60%
------ ------ ------
Operating profit 25,121 18,401 36.52%
plus: investment gains 36
revenues from subsidies 3,400 2,661 27.80%
Non-operating revenues 22
less: non-operating expenditures 535
------ ------ -----
Gross profit 28,521 20,586 38.55%
less: income taxes 1,922 1,199 60.27%
------ ------ -----
Net profit 26,600 19,387 37.20%
====== ====== =====
The above proposal has been reviewed and approved by the first meeting of the
second board of directors of the company in accordance with the relevant
provisions of the related laws, administrative regulations, other regulatory
documents and the Article of Association of Shenzhen Mindray Bio-medical
Electronics Co., Ltd.. This proposal is hereby submitted for review by the
general meeting of shareholders.
Board of Directors
Shenzhen Mindray Bio-medical
Electronics Co., Ltd. (corporate seal)
March 5, 2005
SCHEDULE 6
TERMS AND CONDITIONS OF W. CONVERTIBLE
REDEEMABLE PREFERENCE SHARES
[To be included in the appropriate sections of amended Articles of Association
with appropriate adjustment of Article numbering and cross references]
The rights and restrictions attaching to the Preference Shares are as follows:
15. INCOME
i. If the Company declares any dividend or other
distribution on any Shares, the Holders are
entitled to share in such dividend or other
distribution on a pro rata basis as if each
Preference Share had been converted
immediately prior to the record date for
determining the shareholders of the Company
eligible to receive such dividend or other
distribution (the "Participating Dividend").
ii. The Participating Dividend is payable in
priority to a payment of a dividend to the
holders of any other class of share cre2ital
of the Company.
(2) CAPITAL
i. On a return of capital on winding up or
otherwise (other than on conversion,
redemption or purchase of shares), the
Company's asses avail.`?e for distribution
among the members shall be applied in
reraying the Holders the following amount
(the "Liquidation Preference") pro zeta
:among the Hoiders for each Preference Share
they hold, in priority to a repayment to the
holders of any other class of share, a sum
equal to (i) the Subscription Price plus
interest accrued daily on the basis of a
365-day year at a compound annual rate of 8%
on the Subscription Price (calculated from
the Subscription Date up to and including the
date of the commencement of the winding up or
(in any other case) the date of the return of
capital) less (ii) any Participating
Dividends received;
ii. If the Holders' entitlements under the
Liquidation Preference have not been
satisfied in full, each Preference Share
shall be entitled to share pro rata
-45-
(on an as-converted basis) with the Shares in
the remaining assets (if any) of the Company
available for distribution.
(3) VOTING AND CLASS RIGHTS
a. At all times prior to a Qualified IPO and for so long as the Holders,
together with their transferees under Permitted Transfers hold in
aggregate no less than the lower of (i) 50% of their percentage
interest of shareholdings held upon the Subscription Date (whether
converted or not) or (ii) 5% of the Equity Share Capital, the Company
and the Shareholders shall use their respective rights and powers,
whether as shareholder, director or otherwise to procure, that no
Group Member shall do or agree to do any of the following matters
unless with the prior consent (such consent (or refusal) not to be
i. the entering into any merger or consolidation
of any Group Member with one or more
entities;
ii. the liquidation, winding up or dissolution of
any Group Member, or the filing of bankruptcy
or similar proceedings;
iii. the disposal of any assets or property (other
than in the ordinary course of business)
owned by any Group Member of a total value
per transaction of more than RMB 100 million;
iv. any amendments (by merger or otherwise) to
any Group Member's articles of association or
other constitutional documents save for any
incidental amendments required to be made to
the, articles of association of the PRC
Company in connection with operating matters
in the ordinary course of business, provided
that the scope or consequences of such
amendments are not likely to directly or
indirectly circumvent or alter the rights of
the Holders or the approval rights of the
Holders hereunder;
v. any repurchase or redemption of the equity of
any Group Member other than a redemption of
the Preference Shares or a repurchase of any
Conversion Shares as agreed upon by the
Holder;
vi. the (Corrupted Text) of, or any act
(Corrupted Text)(Corrupted Text) or Ordinary
Share Equivalents into, Shan (Corrupted Text)
or dividends or assets senior or pari passe
to the (Corrupted Text) Shares;
-46-
vii. the issuance of any Equity Share (Corrupted
Text) or Ordinary Share Eq'dvalents ether
than in connection with (i) an IPO, (ii) an
acquisition of minority interests in the PRC
Company or (iii) pursuant to the exercise of
options granted under aey share incentive
schemes appre-xx xxx the Board and any one or
t Holders provided that in each case such
issuance would not otherwise require the
consent of any one of the Holders pursuant to
Articles 3.1.6 or 3.1.12;
viii. any amendments (by merger or otherwise) to
the rights, preferences, privileges or powers
of the Preference Shares;
ix. the retention of any external professional
advisor other than a Big 4 accounting firm to
provide Tax advisory services to the Group or
to assist in the preparation of Tax returns;
x. the entry into any transaction or series of
related transactions by any Group Member,
which has as an objective and/or the effect
of securing a Tax benefit;
xi. any Tax-motivated restructuring of the Group
or of the business, operations or practices
thereof;
xii. the adoption of any share option or share
incentive scheme or employee share trust or
share ownership plan; and
xiii. any transaction or series of transactions in
excess of RMB2 million by any Group Member
with a Major Shareholder (or any of its
Associates or Family Members) or a director
of a Group Member or an Associate of any such
director.
For the avoidance of doubt the Holders' holdings for the purpose of this Article
3.1 shall include any Preference Shares which are subject to a redemption demand
pursuant to a Redemption Notice pursuant to Article 5 until such Redemption
Notice has been satisfied in full.
b. Prior to a Qualified IPO, for so long as the Audited Net Income in any
financial year is less than RMB500 million the prior consent (such
consent (or refusal) not to be unreasonably delayed) of any one of the
Holders is required in relation to the matters referred to below, save
that if the Audited Net Income for any financial year exceeds RMB500
million, from the time that such Financial Statements are. released to
the Holders in accordance with Clause 2.1 of the
-47-
Subscription Agreement, the prior consent of any one of the Holders
shall not be required in relation to any of the matters referred to
below and no prior consent is required to be obtained in relation to
such matters unless the Audited Net Income falls below RMB500 million
for two consecutive financial years and in which case the prior
consent of any one of the Holders in relation to the matters referred
to below is required from the date in the following financial year on
which the Financial Statements are released to the Holders in
accordance with Clause 2.1 of the Subscription Agreement:
i. the declaration of dividends or any
distribution made with respect to a equity
security by any Group Member in respect of
any financial year commencing 1 January 2005
or thereafter of more than 60% of such Group
Member's Audited Net Income (as shown in the
Financial Statements) of that year;
ii. the taking out of any loan or the incurrence
of any indebtedness by the Group or a Group
Member in excess of RMB 100 million, whether
in a single transaction or a series of
related transactions which occur within a
three-month period;
iii. any capital commitment with an aggregate
value in excess of RMB 100 million, whether
in a single transaction or a series of
related transactions, by any Group Member
unless such commitment has already been
specifically approved;
iv. any Group Member making any acquisition or
disposal of or relating to any Intellectual
Property Rights with a value attributable to
such right in excess of RMB100 million or
more;
v. any change in any Group Member's auditors;
vi. any material changes to any Group Member's
business plan previously approved by the
Board;
vii. the granting of any security over any
material assets of the Group or extending a
loan to or guaranteeing any loans for any
person which is not a Group Member; or
viii. the making of any loan or advance to any
person, firm, body corporate or other
business other than in the normal course of
business and on an arm's length basis.
-48-
(4) CONVERSION
i. Each Preference Share shall convert in
accordance with the provisions of this
Article 4:
1. at the election of its Holder at any
time and from time to time including,
for the avoidance of doubt, at any time
during the period between a Redemption
Notice Date and a Redemption Date as set
out in Article 5(a); or
2. immediately before a Qualified IPO (but
not an IPO that is not a Qualified IPO)
upon the underwriting agreement becoming
unconditional in all respects; or
3. prior to an IPO, if any rules,
regulations, ruling or requirements of
the Stock Exchange do not allow the
continuing existence of the Preference
Shares following the IPO, and in which
case the Preference Shares shall be
converted into some other similar
instruments to be agreed to by the
Holder, with substantially the same
rights as the Preference Shares and as
permitted by the Stock Exchange. For the
avoidance of doubt, the foregoing
conversion or exchange shall not be
mandatory and shall be at the sole
discretion of the Holders.
Each Preference Share being converted shall convert into such number
of fully paid Shares as determined by dividing (x) the Subscription
Price for each Preference Share by (y) the then prevailing Conversion
Price. The initial Conversion Price shall be equal to the Subscription
Price and shall thereafter be subject to adjustment in accordance with
Article 4(h) and 4(i).
ii. In this Article 4, a "Conversion Date" is the
date on which a Holder requires any or all of
its Preference Shares to be converted as set
out in a Conversion Notice (or if the Holder
requires his Preference Shares to be
converted on a day which is not a Business
Day, the next Business Day) or (if mandatory
conversion occurs upon a Qualified IPO) the
day on which the underwriting agreement
becomes unconditional in all respects.
-49-
iii. A Holder may convert any or all of his
Preference Shares, as set out in Article
4(a)(i), by serving notice of conversion
("Conversion Notice") together with his
relevant share certificate on the Company at
least ten Business Days before the relevant
Conversion Date. A Conversion Notice once
given may not be withdrawn without the
Company's written consent. The conversion of
all the Preference Shares, as set out in
Article 4(a)(ii), shall be automatic and each
Holder shall be deemed to have served a
Conversion Notice on the Company and shall be
bound to deliver the certificate for his
Preference Shares to the Company as soon as
practicable after the Qualified IPO and in
any event within seven days thereafter.
iv. The Conversion Shares to which a Holder is
entitled upon conversion:
1. shall be validly issued and delivered,
credited as fully paid and free of all
Encumbrances;
2. shall rank pari passu in all respects
and form one class with the Shares then
in issue; and
3. shall entitle the Holder to be paid an
appropriate proportion of all dividends
and other distributions declared, made
or paid on Shares after the Conversion
Date.
The Company covenants that it will at all times reserve and maintain
authority to issue, solely for the purpose of issue or delivery upon any
conversion herein provided, the maximum number of Shares issuable upon
conversion of all Preference Shares.
v. The allotment of Conversion Shares shall be
made on the relies ant Convess-csa Date. A
certificate for Conversion Shares shall be
sent as soon as practicable after the
relevant Conversion Date to the Holder
without charge and, if a fractional
entitlement results from the conversion, a
cheque in respect of such fractional
entitlement shall also be sent. In the
meantime, transfers of Conversion Shares
shall be certified against the register.
vi. Subject to the terms of the Preference Shares
as set out herein and the Companies
Ordinance, the Board
-50-
may in its absolute discretion use any means
available under law to effect conversion in
accordance with the terms hereunder.
vii. No fractions of Shares shall be allotted or
issued to a Holder upon conversion. All
Shares (including fractions thereof) issuable
upon conversion of more than one Preference
Share held by a Holder thereof shall be
aggregated for purposes of determining
whether the conversion would result in the
issuance of any fractional Share. If, after
the aforementioned aggregation, the
conversion would result in the issuance of
any fractional Share, the Company shall, in
lieu of issuing any fractional share, pay
cash equal to the product of such fraction
multiplied by the fair value of one Share on
the date of conversion. Fair value shall be
determined in good faith by the Board.
viii. Subject to Article 4(i), if any of the
following events occur, the Conversion Price
shall be adjusted so that the Holder shall be
entitled to receive such number of Conversion
Shares (expressed as a percentage of the
Fully Diluted Share Capital) as it would have
been entitled to receive after such event had
the Preference Shares been converted
immediately prior to such event:
1. the Company issues further shares in the
capital of the Company on an allotment
of fully paid Shares pursuant to a
capitalisation of profits or reserves to
holders of Shares (provided that no
adjustment to the Conversion Price shall
be made when Shares are allotted by way
of capitalisation of profits or reserves
at the election of the shareholder
instead of cash in respect of all or
part of a dividend or dividends; in
which case, an adjustment, for such
allotment shall be handled in accordance
with Article 4(i);
2. there is a consolidation or sub-division
(or both) of Shares or of. Ordinary
Equivalents;
3. there is an issue of Ordinary Share
Equivalents in a- reclassification of
Shares, other than as contemplated in
Article 4(i); or
-51-
4. the share capital of the Company is
altered in any other way whatsoever not
otherwise dealth with in this Article 4.
An adjustment made pursuant to this Article 4(b) shall become
effective (x) in the case of any such issue or distribution, on the
date immediately following the close of business on the record date
for the determination of holders of Shares entitled to receive such
dividend or distribution car (v) in the case of any such subdivision,
alteration, combination or reclassification to the close of business
on the day upon which such corporate action becomes effective.
ix. If the Company issues or tierces to issue
farther Shares or Ordinssy Shore Equivalents
of the Company excluding (i) any Shares (or
options representing any Shares) issued to
employees, officers or directors o!" the Comp
@n;' pursuant to employee share purchase or
option or grant plans or agreements or other
incentive share arrangements approved by the
Board and any one of the Holders and (ii) any
shares issued in an IPO (including a
Qualified IPO) (the "Additional Shares")
without consideration or for a consideration
per share less than the prevailing Conversion
Price then in such circumstances the
Conversion Price shall be adjusted as
follows:
[ D ]
[ -- ]
A = B [ C + B ]
[ ----- ]
[ E ]
where
1. A is the revised Conversion Price after
adjustment;
2. B is the applicable Conversion Price
immediately prior to the adjustment;
3. C is the sum of (x) the total number of
Shares issuable upon conversion of the
Preference Shares outstanding and (y)
the total number of Shares that would be
issuable upon conversion of any
Preference Shares that have been
redeemed or converted since the
Subscription Date (as if such Preference
Shares were still outstanding), in each
case at the Conversion Price in effect
immediately prior to the adjustment;
-52-
4. D is the aggregate consideration
received in respect of the Additional
Shares; and
5. E is the sum of "C" plus the number of
Additional Shares (or, if the Additional
Shares are Ordinary Share Equivalents,
the number of Shares into which the
Additional Shares are convertible before
any adjustments);
For the purpose of this Article 4(i), the consideration received by the
Company for the issue of Additional Shares shall be computed as follows:
(1) insofar as it consists of cash, the aggregate of the cash received by
the Company;
(2) insofar as it consists of property other than cash, the fair market
value thereof at the time of such issue, as determined in good faith
by the Board provided that if the Holders disagree with such
valuation, fair market value shall be determined by the Company's
auditors (acting as experts and not as arbitrators and whose decision
shall be final and binding save in the case of manifest error) and
such expense incurred shall be borne equally between the Company and
the Holders; and
(3) the consideration per One received by the Company for Additional
Shares that are Ordinary Share Equivalents shall be determined by
dividing:
(x) the total amount, if any, received or receivable by the Company
as consideration for the issue of such Ordinary Share
Equivalents, plus the minimum aggregate amount of additional
consideration (as set forth in the instruments relating thereto,
with regard to any provision contained therein for a subsequent
adjustment of such consideration) payable to the Company upon the
exercise, conversion or exchange of such Ordinary Share
Equivalents; by
(y) the maximum number of Shares (as set forth in the instruments
relating thereto, with regard to any provision contained therein
for a subsequent adjustment of such number) that may be issued
upon the exercise of such Ordinary Share Equivalents or the
conversion or exchange of such Ordinary Share Equivalents.
x. Adjustment under Article 4(i) shall be made
whenever such Shares or Ordinary Share
Equivalents are issued, and shall become
effective on the date of such issue.
Notwithstanding the foregoing, in the event of an issue of Ordinary Share
Equivalents where the number of Shares into which such Ordinary Share
-53-
Equivalent is only capable of determination under Article 4(i)(3)(y)
upon the determination of an IPO Price, such adjustment shall be made
at the time the .'PO Price is determined. Adjustment to the Conversion
Price of the Preference Shares shall be made notwithstanding any
conversion of such Preference Shares into Shares or conversion or
exchange into other Ordinary Share Equivalents in connection with the
IPO.
xi. The ownership adjustment (the "Ownership
Adjustment" shall be the adjustment to the
Holders' aggregate holding on the Ownership
Adjustment Date and the Conversion Price will
be adjusted such that the Holders' aggregate
holding in the Company on such date
immediately after the Ownership Adjustment is
equal to the holding expressed as a
percentage in the formula below:
US$40,000,000
E = -----------------------------------------------------------------
(US$341,440,000 x Company's Subscription Buy-out
percentage ownership in the + Monies - Expenditures
PRC Company as of the
Ownership Adjustment Date
E = the revised percentage holding of the Holders' following the
Ownership Adjustment
xii. Upon any adjustment to the Conversion Price,
the Company shall within a reasonable period
(not to exceed 30 Business Days) following
any of the relevant transactions triggering
the adjustment deliver to the Purchaser a
certificate setting forth in reasonable
detail the event requiring the adjustment and
the method by which such adjustment was
calculated and specifying the Conversion
Price then in effect following such
adjustment.
xiii. If a dispute arises concerning an adjustment
of the Conversion Price in accordance with
this Article 4, the Board shall refer the
matter to the Company's auditors (acting as
experts and not as arbitrators and whose
finding shall be final and binding on all
concerned, save in the case of manifest
error) and any expense incurred shall be
borne equally between the Company and the
Holders.
xiv. Notwithstanding the carve-out of IPOs from
the Conversion Price adjustment mechanism in
Article 4(i), in the event of an issue of
shares in an IPO in which the per share issue
price is lower than the Conversion Price then
prevailing, the IPO Anti-
-54-
Dilution Amount shall be calculated and
settled in cash by payment of a cheque to the
Holders within 30 days after the IPO
(regardless of whether the Preference Shares
are converted into Shares or converted or
exchanged into some other instrument in
connection with the IPO).
xv. In the event that the Company at any time or
from time to time takes any action affecting
its Shares similar to or having an effect
similar to any of the actions described in
Article 4(h) or 4(i) (but not including any
action described in Article 4(h) or 4(i)),
and the Board in good faith determine that it
would be equitable in the circumstances to
adjast the Conversion Price as a ro: o such
action, then, and in each such case, the
Conversion Pie shall be adjusted in such
manner and at such time as the Board in good
faith determines would be equitable in the
circumstances.
xvi. All adjustments to the Conversion Price under
Article 4 are independent.
(5) REDEMPTION
i. In this Article 5, a "Redemption Notice Date"
is the date on hIlith Holder serves a notice
requiring a Preference Share to be redeemed
while "Redemption Date" is the date on which
the Preference Share is redeemed by the
Company.
ii. A Holder may from time to time
1. on or after the third anniversary of the
date of issue of such Preference Shares;
2. at any time after the occurrence of a
Accelerated Redemption Event; or
3. in the event of a Trade Sale on or
before the third anniversary of the
Subscription Date,
require the Company to redeem all or some of his Preference Shares for cash
by serving notice of redemption ("Redemption Notice") together with its
relevant share certificate; or
iii. In the event of a proposed Trade Sale the
Company shall give notice of such Trade Sale
and the terms
-55-
thereof to any one of the Holders not less
than 15 Business Days prior to the proposed
completion date of such Trade Sale.
iv. The redemption amount payable with respect to
each Preference Share ("Redemption Amount"),
shall be a sum equal to (i) the Subscription
Price plus an amount which would provide for
interest accrued daily on the basis of a
365-thy year at a compound annual rate of 10%
on the Subscription Price (calculated from
the Subscription Date up to and including the
Redemption Date) in respect of the Preference
Share less (ii) any Participating Dividends
paid on such Preference Share prior to the
Redemption Date.
v. On the Redemption Notice Date, the Redemption
Amount shall become a debt due and payable by
the Company to the relevant Holder(s),
whether or not the Company has enough profits
available for distribution or other requisite
funds to pay the relevant Redemption Amount.
Without limitation on either (i) any rights
or remedies of the Holders arising under the
foregoing sentence or elsewhere (including
the right to xxx for damages) or (ii) the
obligations of the Company under Article 6,
if the Company is unable to redeem all of the
Preference Shares degrees squired to be
redeemed, it shall redeem as many of the
Preference Shares as it can (on a pro rata
basis, if Redemption Notices are outstanding
from more than one Holder) and the balance as
soon as possible thereafter.
vi. Within 45 Business Days after the Redemption
Date, the Company shall pay the Redemption
Amount to the Holder in respect of those
Preference Shares which are to be redeemed
against receipt of the relevant share
certificate (or an indemnity in a form
reasonably satisfactory to the Board respect
of a share certificate which cannot be
produced). If the Holder produces neither the
share certificate nor a satisfactory
indemnity, the Company may retain the.
portion of the Redemption Amount
corresponding to such Preference Shares until
delivery of the certificate or a satsifactory
indemnity.
-56-
vii. The Company shall cancel share certificates
in respect of redeemed Prefcience Shares and
issue fresh certificates without charge in
respect of any Preference Shares represented
by those certificates remaining outstanding.
(6) REDEMPTION PAYMENT PROCEDURES
At any time after a Holder exercises its redemption rights, the Company
shall take any and all action necessary to obtain adequate cash to fund
such redemption.
(7) PRE-EMPTION RIGHTS ON NEW ISSUES
Save for (i) issues of Shares (or options representing such Shares) to
employees, officers or directors of the Company pursuant to employee share
purchase, share option or share grant plans or agreements or other
incentive share arrangements approved by the Board and any one of the
Holders or (ii) issue of the Conversion Shares, the Company shall not allot
or issue any Shares or Ordinary Share Equivalents on any terms to a person
unless it has made an offer to the Holder to allot and issue to him on the
same terms a proportion of those Shares or Ordinary Share Equivalents which
is equal to such Holder's Percentage Interest (with any fractional
proportion rounded up to the nearest one-tenth of one percent).
(8) FURTHER COVENANTS
i. So long as any Preference Shares are
outstanding, the Company shall promptly, upon
the occurrence of a Accelerated Redemption
Event, give written notice to the Holders of
such Accelerated Redemption Event; and
ii. The Company and the Holders shall pay any and
all taxes in equal shares that may be payable
in respect of the issue or delivery of the
Conversion Shares. The Company shall not,
however, be required to pay any tax which may
be payable in respect of any transfer
involved in the issue and delivery of
Conversion Shares in a name other than that
in which the Preference Shares so converted
were registered, and no such issue or
deli-vary shall be made unless avid until the
person requesting such issue has paid to the
Company the amount f any such tax, or has
established to th sat c :c.ion of the Compaey
that tax has been paid.
(9) DEFINITIONS
"Accelerated Redemption Event" means any Bankruptcy Event;
-57-
"Accounting Principles" means the International Financial Reporting
Standards promulgated by the International Accounting Standards Board
("IASB") (which includes standards and interpretations approved by the IASB
and International Accounting Standards (IAS) issued under previous
constitutions), together with its pronouncements thereon from time to time,
and applied on a consistent basis;
"Additional Shares" has the meaning set out in Article 4(i);
"Affiliate" means with respect to any person, any other person that
directly or indirectly, through one or more intermediaries, Controls, is
Controlled by, or under common Control with the first mentioned person;
"Articles" means the articles of association of the Company, as amended
from time to time;
"Associate" has the meaning set out in the Listing Rules;
"Audited Net Income" for any financial year means the net income of the PRC
Company as set forth in the audited Financial Statements for such financial
year
"Bankruptcy Event" means any of the following:
a. any Group Member shall commence any case,
proceeding or other action (1) under any
existing or future law of any jurisdiction,
domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of
debtors. seeking to have an order for relief
entered with respect to it, or seeking to
adjudicate it bankrupt or insolvent, or
seeking reorganization, arrangement,
adjustment, winding-up, liquidation,
dissolution, composition or other relief with
respect to it or its debts, or (2) seeking
appointment of a receiver, trustee,
custodian, conservator or other similar
official for it or for all or any substantial
part of its assets; or
b. there shall be commenced against any Group
Member any case, proceeding or other action
of a nature referred to in clause (i) above;
or
c. there shall be commenced against any Group
Member any case, proceeding or other action
seeking issuance of a warrant of attachment,
execution, distraint or similar process
against all or any substantial part of its
assets which results in the entry of an order
for any such relief; or
d. any Group Member shall (1) make a general
assignment for the benefit of its creditors,
or (2) shall admit its inability to pay its
debts when they bccoiae due; or
-58-
e. one or more judgments or decress shall be
entered against any Group Member involving,
in the aggregate, a liability (to the extent
not paid or fully covered by insurance)
amounting to more than the net asset value of
the Company on a consolidated basis, and all
such judgments or decress shall not have been
vacated, discharged, stayed or bonded pending
appear within thirty (30) days from the entry
thereof, or any action shall be taken by a
judgment creditor to levy upon assets or
properties of Group Member to enforce any
such judgment;
"Big 4" means any of KPMG, Deloitte Touche Tohmatsu, PricewaterhouseCoopers
Ernst & Young or their respective successors:
"Board" means the board of directors of the Company from time to time;
"Business Day" means a day (excluding Saturday) on which banks are
generally open for business in Hong Kong and in the PRC;
"Buy-out Expenditures" means the aggregate amount paid by the Company
whether in the form of cash or shares, for the acquisition of any shares in
the PRC Company made after the date on which the Preference Shares are
issued to the Holders up to the Ownership Adjustment Date;
"Company" means Mindray International Holdings Limited;
"Companies Ordinance" means the Companies Law, Cap. 22 (Law 3 of 1961, as
consolidated and revised) of the Cayman Islands;
"Control" means the power of a person (or persons acting in concert) to
secure that the affairs of another are conducted directly or indirectly in
accordance with the wishes of that person (or persons acting in concert) by
means of: in the case of a company, being the beneficial owner of more than
50 per cent. of either the issued share capita] of that company or of the
voting rights in that company, or having the right to appoint or remove a
majority of the directors or otherwise control the votes at board meetings
of that company by virtue of any powers conferred by the articles of
association, shareholders' agreement or any other document regulating the
affairs of that company; in the case of a partnership, being the beneficial
owner of more than 50 per cent. of the capital of that partnership, or
having the right to control the composition of or the votes to the majority
of the management of that partnership by virtue of any powers conferred by
the partnership agreement or any other document regulating the affairs of
that partnership; or, in the case of an individual, being an Associate of
that individual; and "Controlled" shall be construed accordingly. For these
purposes, "persons acting in concert", in relation to a person, are persons
who actively co-operate, pursuant to an agreement or understanding (whether
formal or informal), with a view to obtaining or consolidating Control of
that person;
-59-
"Conversion Price" means the price per Share to be issued upon conversion
of all or some of the Preference Shares and which is calculated in
accordance with Article 4(e) (subject to adjustments pursuant to Article
4(i));
"Conversion Shares" means the Shares to be issued by the Company upon
conversion of the Preference Shares;
"Conversion Date" has the meaning set out in Article 4(b);
"Conversion Notice" has the meaning set out in Article 4(c);
"DCL" means Dragon City International Investment Limited;
"DCL Shares" means the number cf Preference Shares acquired from DCL
pursuant to the Subscription Agreement;
"Equity Share Capital" means the issued share capital of the Company
including the Preference Shares, but excluding any part thereof which does
not either as respects dividends or as respects capital carry any right to
participate beyond a specified amount or beyond an amount calculated by
reference to a specified rate in a distribution;
"Family Member" means the spouse, co-habitee, mother, father, grandmother,
grandfather, brother, sister or child of a Major Shareholder;
"Financial Statements" shall include a balance sheet, income statement and
statement of cash flows prepared in accordance with the Accounting
Principles;
"Fully Diluted Share Capital" means at any time the total number of Shares
then issued, assuming the conversion, exchange and exercise in full of all
of the then issued Ordinary Share Equivalents, including, the conversion of
all of the issued Preference Shares at the then prevailing Conversion
Price;
"Group" means the Company and its subsidiaries, the PRC Company and its
subsidiaries, and "Group Member" means any one of them (including the
Company itself).
"Holders" means the holders from time to time of the Preference Shares;
"Hong Kong" means the Hong Kong Special Administrative Region of the PRC;
"Investors" means GS Capital Partners V Fund, L.P., GS Capital Partners V
Offshore Fund, L.P., GS Capital Partners V GmbH & Co. KG and GS Capital
Partners V Institutional, L.P.;
"Intellectual Property Rights" means:
i. patents, trade marks, service marks,
registered designs, applications and rights
to apply for any of those rights, trade,
business and company names,
-60-
internee domain names and e-mail addresses,
unregistered trademarks and service marks,
copyrights, database rights, rights in
software, knowhow, rights in designs and
inventions; and
ii. rights under licenses, consents, orders
statutes or otherwise in relation to a right
in paragraph (a);
"IPO" means a listing of the ordinary share capital of the Company on the
Stock Exchange;
"IPO Anti-Dilution Amount" means for each Preference Share, the difference
between (x) Conversion Price in effect immediately before an IPO and (v)
the Conversion Price that would be in etfect if the Conversion Price
adjustment formula in Article 4(i) were applied with respect to new shares
issued in the IPO (if such IPO offering price is lower than the prevailing
Conversion Price immediately prior to the IPO);
"IPO Price" means the lowest price in the range for the offering price per
ordinary share of the Company to be listed on the Stock Exchange;
"Liquidation Preference" has the meaning set out in Article 2(a);
"Listing Rules" means the Rules Governing the Listing of Securities on the
Stock Exchange of Hong Kong Limited;
"Major Shareholders" means Xu Hang, Li Xiting and Xxxxx Xxxxxx and "Major
Shareholder" means any one of them;
"Ordinary Share Equivalents" means any security or obligation which is by
its terms convertible into or exchangeable or exercisable for Shares or
other share capital of the Company, including without limitation, the
Preference Shares, other convertible preference shares or convertible debt
instruments, any option, warrant or other subscription or purchase right
with respect to the Shares or such other share capital in the Company;
"Ownership Adjustment Date" means the earlier of (i) the earliest
practicable date prior to an IPO and (ii) the Performance Adjustment Date;
"Ownership Adjustment Factor" has the meaning set out in Article 4(k);
"Participating Dividend" has the meaning set out in Article 1(a);
"Percentage Interest" means at any time the amount resulting from dividing
(x) the aggregate number of Shares into which each Preference Share is then
convertible by (y) the Fully Diluted Share Capital;
"Performance Adjustment Date" means the date epos which adjustmset shall he
performed which shall be a date that falls within 1 month following the
dote the audited
-61-
accounts of the PRC Company for the year ending 31 December 2005 are
available hut in any event no later than 30 June 2006;
"Permitted Transfers" means any transfer of Equity Share Capital:
1. to a person who is to hold such Equity
Share Capital transferred, as a niminee
on behalf of the transferor (but
excludes any transfer by such nominees
and a nominee for the purposes of this
definition excludes any entity that is a
member of an Investor);
2. by a nominee to the beneficial owner of
such Equity Share Capital to another
nominee of the same beneficial owner; or
3. to an Affiliate; or
4. in the case of a Major Shareholder to a
Family Member;
"Preference Shares" means the convertible redeemable preference shares of
HK$0.01 each in the capital of the Company, having the rights set out
herein;
"Qualified IPO" means an IPO on the Stock Exchange which occurs within the
following periods with the corresponding minimum IPO Price or an IPO to
which any one of the Investors has otherwise consented expressly to as a
Qualified IPO:
IPO Timing
(No. of months after the
Completion Date up to the date
of any prospectus issued in
connection with a Listing) 0-6 6-12 12-18 18-24 Thereafter
IPO Price as % of the
Conversion Price 100% 120% 135% 170% 200%
"Redemption Amount" has the meaning set out in Article 5(c);
"Redemption Date" has the meaning set out in Article 5(a);
"Redemption Notice" has the meaning set out in Article 5(b);
"Redemption Notice Date" has the meaning set out in Article 5(a);
"Secondary Shares" means the number of Preference Shares acquired from the
Major Shareholders pursuant to the Subscription Agreement;
"Share(s)" means ordinary shares of HK$0.01 each in the issued share
capital of the Company in issue from time to time and all other (if any)
stock or
-62-
shares from time to time and for the time being ranking par; passu
therewith and all other (if any) stock or shares in the Equity Share
Capital resulting from any sub-division, consolidation or
re-classification thereof; having the rights and being subject to the
restrictions set out in the Articles;
"Stock Exchange" means The Stock Exchange of Hong Kong Limited or such
other internationally recognised stock exchange as may be agreed by any one
of the Holders and the Major Shareholders in writing from time to tine;
"Subscription Date" means the date of subscription of the Preference Shares
by the Holders;
"Subscription Agreement" means the subscription and share purchase
agreement dated 6 July 2005 and entered into between the Company, DCL, the
Investors and the Major Shareholders in relation to, inter alia, the
subscription for the Preference Shares by the Investors;
"Subscription Price" means the Subscription Amount divided by the sum of
the number of Preference Shares issued and the Seconda:y Sale Shares and
DCL Shares purchased pursuant to the Subscription Agreement;
"Trade Sale" means any event whereby either (i) the Major Shareholders and
their transferees under Permitted Transfers in aggregate cease to directly
or indirectly hold legal and beneficial ownership and voting rights of at
least 30% of the Fully Diluted Share Capital of the Company; or (ii) the
Company's Voting rights or interest in the registered capital of the PRC
Company decreases at any time to less that 80%, or (iii) a sale of all or
substantially all of the assets of the PRC Company or the Company;
"Tax" means any form of Taxation, levy, duty, charge, contribution or
impost of whatever nature (including any related fine, penalty, surcharge
or interest) imposed by a Tax Authority; and
"Tax Authority" means any local, municipal, governmental, state, federal or
other fiscal, revenue, customs or excise authority, body or official
any-where in the world including, without limitation, the Inland Revenue
Department of Hong Kong, the State Tax Bureau of the PRC and the relevant
provincial and/or local Tax bureau of the PRC.
-63-
EXHIBIT A
FORM OF REDEMPTION NOTICE [date]
To: [the Company]
[Address]
Re: Redemption Notice in relation to the Preference Shares
Dear Sirs:
We, the Holders, hereby deliver this Redemption notice pursusrt to Section 4(b)
of the Certificate of Designations (as hereinafter defined) and hereby notify
the Company of the exercise of the redemption right set forth in Section 5(b)[i]
[ii] [iii] of the Certificate of Designations to redeem [___] Preference Shares
at a redemption price calculated pursuant to Section 5(d) ((the "Redemption
Price").
Aggregate accrued but unpaid dividends with respect to the Preference Shares be
redeemed: US$ [__________]
Total Redemption Amount: US$ [__________]
Please kindly transfer to each of the redeeming Holders their pro rata share of
the Redemption Amount in accordance with the provisions of Section 5(f) of the
Certificate of Designations.
Capitalized terms used herein and not otherwise defined shall have their
respective meanings as set forth in the Certificate of Designations contained in
Schedule A to the Amended and Restated Articles of Association of the Company
(the "Certificate of Designations").
Very truly yours,
[Names of the Holder(s)]
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
-64-
EXHIBIT B
FORM OF CONVERSION NOTICE
To: [the Company]
[Address]
Re: Conversion Notice in relation to the Preference Shares
Dear Sirs:
We, the Holders, hereby deliver this Conversion Notice pursuant to Section 4(c)
of the Certificate of Designations (as hereinafter defined) and hereby notify
the Company of the exercise of the conversion right set forth in Section 4(a)[i]
[ii] [iii] of the Certificate of Designations to convert [ ] Preference Shares
at the applicable Conversion Price.
Aggregate accrued but unpaid dividends with respect to the Preference Shares be
converted: US$ [__________________]
Total Shares to be issued upon conversion: [____________________] Shares
Please kindly issue to each of the Holders their pro rata share of the Shares
issuable upon conversion in accordance with this Conversion Notice and with the
provisions of Section 4(e) of the Certificate of Designations.
Capitalized terms used herein and not otherwise defined shall have their
respective meanings as set forth in the Certificate of Designations contained in
Schedule A to the Amended and Restated Articles of Association of the Company
(the "Certificate of Designations").
Very truly yours,
[Names of the Holder(s)]:
By:
------------------------------------
Name:
----------------------------------
Title:
------------------------------------
-65-
SCHEDULE 7
KEY EMPLOYEES
Key Employee ID No.
------------ ------
Xu Hang 440301196205186972
Li Xiting 420106510617441
Wang Fuqing 352229671112553
Xxxxx Xxxxxx 310104611009045
Xxx Xxxxxxxxx 510212196809170375
Mu Xxxxx 420106540917527
Yan Baiping 610103196308042019
Xxx Xxxxxx 340111631019752
Xxxx Xxxxxxx 220104540212442
Xxxxx Xxxxxx 610103196209172432
Xx Xxx 310110197206205013
-66-
EXECUTED by the parties:
GS CAPITAL PARTNERS V FUND, L.P.
BY: GSCP V Advisors, L.L.C.
its General Partner
BY: /s/ Xxxxx X. Xxxx
---------------------------------
Xxxxx X. Xxxx
GS CAPITAL PARTNERS V FUND, L.P.
BY: GSCP V Offshore Advisors, L.L.C.
its General Partner
BY: /s/ Xxxxx X. Xxxx
---------------------------------
Xxxxx X. Xxxx
GS CAPITAL PARTNERS V FUND, L.P.
BY: GS Advisors V, L.L.C.
its Managing Limited Partner
BY: /s/ Xxxxx X. Xxxx
---------------------------------
Xxxxx X. Xxxx
GS CAPITAL PARTNERS V FUND, L.P.
BY: GSCP Advisors V, L.L.C.
its General Partner
BY: /s/ Xxxxx X. Xxxx
---------------------------------
Xxxxx X. Xxxx
-67-
Signed by
-------------------------------------
/s/ Li Xiting
-------------------------------------
LI XITING
duly authorised for and on behalf of
MINDRAY INTERNATIONAL HOLDINGS
LIMITED
Signed by
-------------------------------------
/s/ Xu Hang
-------------------------------------
XU HANG
duly authorised for and on behalf of
SHENZHEN MINDRAY BIO-MEDICAL
ELECTRONICS CO., LTD.
Signed by
-------------------------------------
/s/ Xxx Xxx Yu
-------------------------------------
XXX XXX YU
duly authorised for and on behalf of
DRAGON CITY INTERNATIONAL INVESTMENT
LIMITED
-68-
Signed by
/s/ Xu Hang
-------------------------------------
XU HANG
Signed by
/s/ Li Xiting
-------------------------------------
LI XITING
Signed by
/s/ Xxxxx Xxxxxx
-------------------------------------
XXXXX XXXXXX
-69-
TABLE OF CONTENTS
Page
----
1. INTERPRETATION....................................................... 2
2. CONDITIONS AND CONDUCT BEFORE COMPLETION............................. 10
3. COMPLETION........................................................... 13
4. USE OF PROCEEDS...................................................... 17
5. WARRANTIES........................................................... 17
6. AUTHORITY AND CAPACITY............................................... 20
7. COSTS AND FEES....................................................... 20
8. ANNOUNCEMENTS........................................................ 21
9. NOTICES AND OTHER COMMUNICATIONS..................................... 21
10. CONFIDENTIAL INFORMATION............................................. 22
11. MISCELLANEOUS........................................................ 23
12. GOVERNING LAW AND ARBITRATION........................................ 23
13. PREVIOUS AGREEMENTS.................................................. 24
14. INFORMATION.......................................................... 32
15. CAPACITY AND AUTHORITY............................................... 32
16. SHARES AND SUBSIDIARY UNDERTAKINGS................................... 33
17. LIABILITIES.......................................................... 34
18. ACCOUNTS............................................................. 35
19. CURRENT TRADING...................................................... 35
20. TAX.................................................................. 36
21. ASSETS............................................................... 37
22. INTELLECTUAL PROPERTY................................................ 37
23. ENVIRONMENTAL MATTERS................................................ 38
24. AGREEMENTS........................................................... 38
25. LITIGATION AND COMPLIANCE WITH LAW................................... 39
26. EMPLOYEES............................................................ 40
27. MISCELLANEOUS........................................................ 41
SCHEDULE I Part A - THE MAJOR SHAREHOLDERS
Part B - THE INVESTORS
-i-
TABLE OF CONTENTS
(continued)
Page
----
SCHEDULE 2 Part A - DETAILS OF THE GROUP
Part B - DETAILS OF DCL
SCHEDULE 3 WARRANTIES
SCHEDULE 4 PRC COUNSEL OPINION MATTERS
SCHEDULE 5 ANNUAL BUDGET
SCHEDULE 6 TERMS AND CONDITIONS OF THE CONVERTIBLE REDEEMABLE PREFERENCE
SHARES
SCHEDULE 7 KEY EMPLOYEES
-ii-
Execution Version
SUBSCRIPTION AND SHARE PURCHASE AMENDMENT AGREEMENT
This Agreement is made on 22 August 2005
BETWEEN:
(1) MINDRAY INTERNATIONAL HOLDINGS LIMITED a private limited company
incorporated in the Cayman Islands with its registered office at c/o Codan
Trust Company (Cayman) Limited, Century Yard, Crickets Square, Xxxxxxxx
Drive, P.O. Box 2681 GT, Xxxxxx Town, Grand Cayman, British West Indies
(the COMPANY);
(2) SHENZHEN MINDRAY BIO MEDICAL ELECTRONICS CO., LTD., a foreign invested
company limited by shares incorporated in the People's Republic of China,
with its legal address at Mindray Building, Keji 12th Road South, Hi-tech
Industrial Park, Nanshan, Shenzhen, PRC, 518057 (the PRC COMPANY);
(3) THE PERSONS whose names and addresses are set out in Part B of Schedule 1
(together the INVESTORS and each an INVESTOR);
(4) THE INDIVIDUALS whose names and addresses are set out in Part A of Schedule
1 (the MAJOR SHAREHOLDERS and each a MAJOR SHAREHOLDER); and
(5) DRAGON CITY INTERNATIONAL INVESTMENT LIMITED, a private limited company
incorporated in the British Virgin Islands with its registered office at
OMC Xxxxxxxx, P.O. Box 3152, Road Town, Tortola, British Virgin Islands
(DCL).
WHEREAS:
(A) The Parties on 6 July 2005 entered into a Subscription and Share Purchase
Agreement (the SSPA) under which the Parties have agreed that the
Investors, subject to satisfaction of various conditions precedent and
closing day obligations as set out therein, shall (i) subscribe for and be
issued certain convertible redeemable preference shares issued by the
Company (the SUBSCRIPTION SHARES) for consideration of US$28,089,302 (the
SUBSCRIPTION MONIES) and (ii) purchase from the Major Shareholders and DCL
certain additional convertible, redeemable preference shares in the Company
(the SECONDARY SHARES and DCL SHARES, respectively) for aggregate
consideration, respectively, of US$7,940,465 (the SECONDARY SALE AMOUNT)
and US$3,970,233 (the. DCL AMOUNT).
(B) The Cut-off Date (as defined in the SSPA) has expired, and the Parties wish
to extend the Cut-off Date as permitted under the terms of the SSPA.
(C) The Parties have agreed to revise the funding mechanics for the
Subscription Monies and Secondary Sale Amount and timing of such funding to
effect funding prior to Completion under the SSPA.
(D) The Company and the Investors have on same date executed an Escrow
Agreement with The Hongkong and Shanghai Banking Corporation Limited as
escrow agent (the ESCROW AGENT) whereby the Subscription Monies will be
paid into escrow and released to the Company pending Completion.
(E) The Investors, the Major Shareholders and DCL have agreed that the
Secondary Sale Amount and DCL Amount shall be paid by the Investors prior
to Completion in accordance with the terms set out herein with such
Secondary Sale Amount and DCL Amount to be repaid to the Investors, as set
out herein, if Completion for any reason does not occur.
(F) The Investors, the Major Shareholders and DCL have on same date executed
share mortgage agreements (together, the SHARE MORTGAGE AGREEMENTS) under
which each of the Major Shareholders (excluding Xxxxx Xxxxxx) shall
mortgage to the Investors a portion of its shares in an entity which
indirectly holds an interest in the PRC Company to secure their respective
repayment obligations for the Secondary Sale Amount.
(G) Xu Hang has on same date executed share mortgage agreements (the BACK-STOP
SHARE MORTGAGE AGREEMENTS) to secure the repayment obligations of Xxxxx
Xxxxxx and DCL for Cheng Minghe's pro-rata portion of the Secondary Sale
Amount and the DCL Amount, respectively. The Back-Stop Share Mortgages
shall continue to be effective until the Relevant Date (as defined
therein).
THE PARTIES AGREE as follows:
1. Within one Business Day (defined as any day when banks in New York and Hong
Kong are open for general business) following the satisfaction of the following
Conditions Precedent, the Investors shall pay the Secondary Sale Amount and DCL
Amount to the Major Shareholders and DCL in the proportions set out in the SSPA
in consideration for the purchase of the Secondary Shares and DCL Shares:
(i) Execution of the Share Mortgage Agreements by the Major Shareholders and
DCL;
(ii) Provision to the Investors of original share certificates and executed
transfer forms in blank as are required to perfect the security created
under the Back-stop Share Mortgage Agreements and the Share Mortgage
Agreements (other than the Share Mortgage Agreement executed by DCL in
respect of shares in Greatest Elite). The Major Shareholders and DCL shall
endeavor to provide such certificates and transfer forms within three
Business Days after the date of execution of this Agreement;
(iii) The execution of an escrow agreement with the Escrow Agent in form and
substance satisfactory to the Investors; and
(iv) The Investors have received a legal opinion from the Investors' British
Virgin Islands counsel relating to the Share Mortgage Agreements and
Back-stop Share Mortgage
Page 2
Agreements, provided that such Condition Precedent shall bedeemed waived if
the opinion is not received within three (3) Business Days after the date
of execution of this Agreement.
2. In the event that the SSPA is terminated for any reason whatsoever prior to
Completion, each Major Shareholder and DCL shall on a several basis within five
(5) days after such termination (PAYMENT DEADLINE) repay an amount equal to (i)
its respective portion of the Secondary Sale Amount (in the case of the Major
Shareholders) as set out in Schedule 1 or (ii) the DCL Amount (in the case of
DCL), in US dollars to the Investors. Such amounts shall be transferred by the
Major Shareholders and DCL to an account(s) designated by the Investors without
deduction or set-off of any kind. Interest shall accrue daily on any amounts not
paid by the Payment Deadline (including amounts payable under Clause 3) at the
rate of 8% per annum.
3. The Investors shall be entitled to be paid (and the relevant Major
Shareholders and DCL shall pay to the Investors) an amount equal to 40% of all
dividends declared on shares mortgaged under the Share Mortgage Agreements or
Back-stop Share Mortgage Agreements during the period commencing from the date
of payment by the Investors under Clause 1 of the Secondary Sale Amount and DCL
Amount and terminating with respect to any particular mortgaged shares upon the
earlier of (i) the date of expiration of the security period (as defined in the
relevant Share Mortgage Agreement or Back-stop Share Mortgage Agreement) and
(ii) Completion under the SSPA.
4. The Cut-off Date as defined in the SSPA is hereby extended to 15 February
2006 and the SSPA shall be amended accordingly.
5. Existing Clause 1.1 of the SSPA shall be amended by adding the following
definitions:
"AMENDMENT AGREEMENT" means the Amendment Agreement executed on 22 August
2005 by the Parties;
"ESCROW AGENT" means The Hongkong and Shanghai Banking Corporation Limited;
6. Existing Clause 3.1.4 of the SSPA (other than the table which shall remain)
shall be replaced by the following new Clause 3.1.4:
"the Investors shall purchase and each of the Major Shareholders shall sell
such percentage of the total number of Secondary Shares set out against its
name below in consideration for payment of the Secondary Sale Amount under
the Amendment Agreement:"
7. Existing Clause 3.1.5 of the SSPA (other than the table which shall remain)
shall be replaced by the following new Clause 3.1.5:
"the Investors shall purchase and DCL shall sell the DCL Shares in
consideration for payment of the DCL Amount under the Amendment Agreement:"
8. Existing Clauses 3.1.6(a) and 3.1.7(a) shall be revised by deleting the words
"and the Registration Rights Agreement".
Page 3
9. Existing Clause 3.1.6(b) of the SSPA shall be replaced by the following new
Clause 3.1.6(b):
"(b) subject to deposit of the Subscription Monies in full with the Escrow
Agent and receipt of a copy of the Escrow Agreement's joint signatory
instructions to the Escrow Agent to release the Subscription Monies'to
the Company executed by the Investors' representative, share
certificate(s) for the Convertible Redeemable Preference Shares in the
name of the Investors as set out in Clause 3.1.2;"
10. Existing Clause 3.1.7(c) of the SSPA shall be replaced by the following new
Clauses 3.1.7(c) and 3.1.7(d):
"(c) a copy of the Escrow Agreement's joint signatory instructions to the
Escrow Agent to release the Subscription Monies to the Company
executed by the Investors' representative; and"
"(d) (i) Deeds of Release relating to the Share Mortgage Agreements,
executed by the Investors; and (ii) all original share certificates
and transfer forms which were delivered by the mortgagors under the
Share Mortgage Agreement to the Investors."
11. The following new Clause 11.9 shall be added:
"The Investors shall enjoy the registration rights set out in the
registration rights term sheet in the agreed form."
12. This Agreement amends the SSPA only to the extent expressly provided herein.
13. This Agreement shall be governed by and construed in accordance with the
laws of Hong Kong.
14. If any dispute between the parties arises in connection with this Agreement,
they shall use all reasonable endeavours to resolve the matter amicably. If one
party gives another notice that a material dispute has arisen and those parties
are unable to resolve the dispute within 30 days of service of notice, then the
dispute shall be referred to arbitration in accordance with Clause 15.
15. All disputes arising out of or in connection with this Agreement shall be
finally settled under the Rules of Arbitration of the International Chamber of
Commerce by three arbitrators appointed in accordance with the said Rules. The
arbitration institute shall be the International Court of Arbitration of the
International Chamber of Commerce. The place of arbitration shall be in Hong
Kong. The language of the arbitration shall be English.
Page 4
16. This Agreement may be entered into by any Party by executing a counterpart
hereof. All such counterparts when taken together shall constitute one and the
same instrument and this Agreement shall only take effect upon the execution by
each of the Parties hereto.
EXECUTED by the parties:
GS CAPITAL PARTNERS V FUND, L.P.
BY: GSCP V Advisors, L.L.C.
its General Partner
BY: /s/ Xxxx X.Xxx
---------------------------------------
GS CAPITAL PARTNERS V OFFSHORE FUND, L.P.
BY: GSCP V Offshore Advisors, L.L.C.
its General Partner
BY: /s/ Xxxx X.Xxx
---------------------------------------
GS CAPITAL PARTNERS V GmbH & CO. KG
BY: GS Advisors V, L.L.C.
its Managing Limited Partner
BY: /s/ Xxxx X.Xxx
---------------------------------------
GS CAPITAL PARTNERS V INSTITUTIONAL, L.P.
BY: GS Advisors V, L.L.C.
its General Partner
BY: /s/ Xxxx X.Xxx
---------------------------------------
Signed by
-------------------------------------------
-------------------------------------------
duly authorised for and on behalf of )
MINDRAY INTERNATIONAL HOLDINGS LIMITED )
Page 5
Signed by
-------------------------------------------
/s/ Xxx Xxx Yu
-------------------------------------------
duly authorised for and on behalf of )
DRAGON CITY INTERNATIONAL INVESTMENT LIMITED )
Signed by
/s/ Xu Hang
-------------------------------------------
XU HANG
Signed by
/s/ Li Xiting
-------------------------------------------
LI XITING
Signed by
/s/ Xxxxx Xxxxxx
-------------------------------------------
XXXXX XXXXXX
Page 6
SCHEDULE 1
PART A - THE MAJOR SHAREHOLDERS
Pro-rata portion of Secondary Sale Amount
Xu Hang US$2,382,139
ID No. 440301196205186972
Li Xiting US$4,764,279
ID No. 420106510617441
Xxxx Xxxxxx US$794,047
ID No. 310104611009045
PART B - THE INVESTORS
1. GS CAPITAL PARTNERS V FUND, L.P.
- nature (e.g. limited
liability company): Limited partnership
- place of incorporation: Delaware
- registered office: The Corporation Trust Company,
Corporation Trust Center,
0000 Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, XXX
- relationship with other
Investors: General Partner:
Affiliates of the Xxxxxxx Sachs Croup,
Inc.
2. GS CAPITAL PARTNERS V OFFSHORE FUND, L.P.
- nature (e.g. limited
liability company): Limited partnership
- place of incorporation: Cayman Islands
Page 7
- registered office: c/o M&C Corporate Services Limited,
P.O. Box 309, Grand Cayman,
Cayman Islands,
British West Indies
- relationship with other
Investors: General Partner:
Affiliates of the Xxxxxxx Xxxxx Group,
Inc.
3. GS CAPITAL PARTNERS V GmbH & CO. KG
- nature (e.g. limited
liability company): Limited partnership
- place of incorporation: Germany
- registered address: c/o Goldman, Sachs & Co., OHG,
Messeturm, Xxxxxxxxx-Xxxxx-Xxxxxx,
00, 00000 Xxxxxxxxx/Xxxx
Xxxxxxx
- relationship with other
Investors: General Partner:
Affiliates of the Xxxxxxx Sachs Group,
Inc.
4. GS CAPITAL PARTNERS V INSTITUTIONAL, L.P.
- nature (e.g. limited
liability company): Limited partnership
- place of incorporation: Delaware
- registered office: The Corporation Trust Company,
Corporation Trust Center,
0000 Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, XXX
Page 8
- relationship with other
Investors: General Partner:
Affiliates of the Xxxxxxx Xxxxx Group,
Inc.
Page 9
