EXHIBIT 10.27
AMENDED AND RESTATED
EXCLUSIVE EQUITY PURCHASE OPTION AGREEMENT
This Amended and Restated Exclusive Equity Purchase Option Agreement (the
"AGREEMENT") is made and entered into as of ______________, 2006 (the "EFFECTIVE
DATE"), by and between:
1. PARTY A: [Name of the contracting shareholder of the affiliated entity], a
People's Republic of China ("PRC") national and holder of PRC identity card
number [ID number] ("PARTY A");
2. PARTY B: [Name of the affiliated entity, the wholly-owned foreign
enterprise], a company incorporated under the laws of the PRC and having
its principal office located at [Address] ("PARTY B"); and
3. PARTY C: [Name of the PRC subsidiary], a company incorporated under the
laws of the PRC and having its principal office located at [Address]
("PARTY C").
WHEREAS:
A. PARTY B has or caused to have extended a loan to PARTY A pursuant to an
Amended and Restated Loan Agreement dated as of [date];
B. PARTY A has agreed to provide PARTY B with the right to purchase, at the
sole discretion of PARTY B, part or all of PARTY A's equity interest in
PARTY C; and
C. PARTY A, PARTY B and PARTY C have entered into an Exclusive Equity Purchase
Option Agreement on [date] ("ORIGINAL OPTION Agreement").
NOW, THEREFORE, the parties expressly agree to amend and restate the Original
Option Agreement as follows:
1. For good and valuable consideration the receipt of which is hereby
acknowledged, PARTY A hereby grants to PARTY B the right to purchase (the
"PURCHASE RIGHT"), at PARTY B's sole discretion and as and when permitted
by PRC law, by PARTY B directly or in the name of a nominee (the "PARTY B
NOMINEE"), at the sole discretion of PARTY B, part or all of PARTY A's
equity interest in PARTY C, which represents the entire equity interest in
PARTY C, together with all property rights as may derive from or accrue to
the same, including without limitation, additional equity or replacement
securities representing interests in PARTY C or an affiliate or successor
in interest of PARTY C, and all dividends and other income or proceeds
derived
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therefrom or receivable or received on the sale, exchange, collection or
other disposition thereof, whether in cash, equity or other forms and
whether voluntary or involuntary, and distributions with respect thereto,
[_____] percent [_____]% of the total equity interest in PARTY C (the
"EQUITY INTEREST").
2. This Purchase Right is exercisable at the discretion of PARTY B, at any
time, for part or all of the Equity Interest, by providing PARTY A with
thirty (30) days prior written notice in the form attached at Exhibit A
(the "EXERCISE NOTICE") of its intent to exercise the Purchase Right.
2.1 Upon the conclusion of the thirty (30) day period, or at such earlier
time as agreed upon by the parties, PARTY B or the PARTY B NOMINEE, as
the case may be, PARTY A shall execute a binding equity transfer
agreement in the form attached at Exhibit B (the "EQUITY TRANSFER
AGREEMENT") or other form agreed by the Parties in accordance with the
then applicable laws for the transfer of the Equity Interest stated in
the Exercise Notice.
2.2 PARTY A shall, upon the request of PARTY B at any time, transfer such
portion of the Equity Interest as requested by PARTY B immediately to
PARTY B or the PARTY B NOMINEE.
2.3 PARTY A shall use its best efforts to procure timely finalization and
government approval and registration of the equity transfer
contemplated under this Purchase Right (the date of such approval or
registration, whichever is later, shall be the "TRANSFER DATE").
3. PARTY B or the PARTY B NOMINEE, as applicable, shall pay for the Equity
Interest by paying an amount equal to RMB[Amount] (the "AGGREGATE PURCHASE
PRICE"), or such other amount or by way of such other methods as permitted
by the then PRC law including, but not limited to, by set off against an
equivalent amount of debt owed by PARTY A. If the applicable PRC laws
require the evaluation of the Equity Interest to be transferred or
stipulates other restrictions or requirements in relation to the price of
the transfer of the Equity Interest in the performance of the Purchase
Right by PARTY B or the PARTY B NOMINEE such that the Aggregate Purchase
Price is lower than the lowest price allowed by the applicable laws, the
Parties agree that the purchase price shall be the lowest price allowed by
the applicable laws. If PARTY B or the PARTY B NOMINEE acquires the Equity
Interest in parts over a period of time through more than one exercise of
the Purchase Rights, then for each such exercise of the Purchase Rights,
the purchase price shall be the percentage of the Equity Interest being
acquired multiplied by the Aggregate Purchase Price or the lowest price
allowed by the applicable laws, as the case may be.
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4. PARTY B represents and warrants to PARTY A that each of the following
representations and warranties is true and accurate in all material
respects and is not misleading as of the date of this Agreement and will be
true and accurate in all material respects and not misleading as of the
Transfer Date:
4.1 This Agreement is a valid and legally binding agreement of PARTY B,
enforceable against PARTY B in accordance with its terms.
4.2 PARTY B has obtained all corporate authorizations required to empower
it to enter into this Agreement and to perform its obligations under
this Agreement and to carry out the transactions contemplated to be
performed on its part hereby.
5. PARTY A and PARTY C represent and warrant to PARTY B that each of the
representations and warranties set out in this Section 5 is true and
accurate in all material respects and is not misleading as of the date of
this Agreement and will be true and accurate in all material respects and
not misleading as of the Transfer Date and covenant as follows:
5.1 This Agreement is a valid and legally binding agreement of PARTY A,
enforceable against it in accordance with its terms. Neither the
execution and delivery of this Agreement by PARTY A, nor the
performance by PARTY A of its obligations hereunder, nor the
consummation of the transactions contemplated hereby, will violate any
statute or law or any judgment, decree, order, regulation or rule of
any court or governmental authority to which PARTY A is subject.
5.2 The execution, delivery and performance of the obligations of this
Agreement and the consummation of the transactions contemplated
hereunder shall not contravene any of PARTY A's obligations to any
person under any contract, security document, undertaking, agreement,
instrument or otherwise.
5.3 PARTY A is both the legal and beneficial owner of the Equity Interest
of record; save and except as agreed by PARTY B in writing in advance,
PARTY A has not granted, issued nor agreed to grant or issue any
option, right to acquire, mortgage, charge, pledge, lien or other form
of security or encumbrances on, over or affecting any part of the
Equity Interest.
5.4 Without prior written consent of PARTY B, PARTY A shall not agree,
vote in favour of, support or execute or permit to be executed any
shareholders resolution during PARTY C's shareholders' meeting that
approves any variation, supplement, change or renewal of the Articles
of Association of PARTY C;
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increase or decrease in the registered capital of PARTY C; or to
change the structure of the registered capital in any other manner;
5.5 Upon the request of PARTY B, PARTY A shall procure PARTY C to provide
all materials relating to the operations and financial status of PARTY
C;
5.6 Without the prior written consent of PARTY B, PARTY A shall not agree,
vote in favour of, support or execute or permit the execution of any
shareholders resolution during PARTY C's shareholders' meeting that
approves PARTY C to merge with or become associated with, or acquire
or invest in any person or entity;
5.7 PARTY A shall notify PARTY B of the occurrence or the potential
occurrence of any litigation, arbitration or administrative procedure
related to the Equity Interest or the assets, business or revenues of
PARTY C;
5.8 Without the prior written consent by PARTY B, PARTY A shall not
request or permit PARTY C to distribute dividends or profits to
him/her, and PARTY A shall not agree, vote in favour of, support or
execute any shareholders resolution during PARTY C's shareholders'
meeting that approves PARTY C to issue any dividends or profits to
PARTY B in any form;
5.9 Upon the request of PARTY B, PARTY A shall procure a shareholder's
meeting of PARTY C be convened to appoint person(s) recommended by
PARTY B to be the directors or the legal representative of PARTY C;
5.10 PARTY A will not dispose of or encumber or permit the disposition or
encumbrance of the Equity Interest in any manner without the prior
written consent of PARTY B, notwithstanding any contradicting
provisions in any other agreements between PARTY A and PARTY B.
5.11 PARTY C is duly incorporated in its place of incorporation and is
validly existing under the laws of the PRC.
5.12 PARTY C has the requisite corporate power and authority to own and
operate its properties and assets and to carry on its business as set
forth in its business license.
5.13 PARTY C has obtained all requisite franchises, licences, consents,
permits, exemptions and approvals to carry on advertising business and
its other business in all the places and in the manner in which such
business is now conducted and it can obtain, without undue burden or
expense, any similar authority for the conduct of such business as
proposed to be conducted.
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6. As permitted by the then applicable PRC laws and regulations, each party
hereto agrees to do any and all things, take any and all actions, perform
any further acts and execute and deliver any further documents that are
reasonably necessary to carry out and effect the provisions of this
Agreement.
7. Any amendment and supplement of this Agreement shall be made by the Parties
in writing. The amendment and supplement duly executed by each Party shall
be deemed as a part of this Agreement and shall have the same legal effect
as this Agreement. The observance of any term of this Agreement may be
waived only with the consent of the party with the right to enforce such
term.
8. Except as may be otherwise provided herein, all notices, requests, waivers
and other communications made pursuant to this Agreement shall be made in
accordance with the notice provisions of the equity pledge agreement dated
[date] and ___________________, respectively signed among PARTY A, PARTY B
and PARTY C.
9. Any information received by one party from the other party in connection
with the transfer contemplated by this Agreement shall be confidential. The
parties hereto agree that any such information shall be used solely for the
purpose of evaluating and consummating the transfer contemplated hereby,
and that neither party shall publish through the news media or leak or
disclose to any person who is not a party to this Agreement any such
information.
10. The titles and subtitles used in this Agreement are used for convenience
only and are not to be considered in construing or interpreting this
Agreement.
11. If the parties hereto are unable to settle any dispute arising from the
provisions of this Agreement through mediation, any party hereto can submit
the dispute for final and binding arbitration to the China International
Economic and Trade Arbitration Commission ("CIETAC") in Shanghai for
arbitration before a panel of three (3) arbitrators pursuant to the then
valid arbitration rules of CIETAC.
12. The language used in arbitration shall be Chinese and English. Any document
used in arbitration may be written in Chinese and/or English.
13. Any arbitration decision shall be final and all expenses for arbitration
shall be borne by the losing party.
14. This Agreement shall be governed by the laws of the PRC.
15. Unless otherwise terminated pursuant to Clause 16 below, this Agreement
shall take effect upon the due execution by both parties and shall remain
valid and effective
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for ten (10) years (the "TERM"). The Term may be extended for successive of
ten (10) years upon Party B's prior written notice.
16. This Agreement shall be terminated by the occurrence of any of the
following event:-
16.1 when PARTY A has transferred all the Equity Interest to PARTY B or the
PARTY B NOMINEE subject to the provisions herein;
16.2 the term of operation of either PARTY B or PARTY C expires and has not
been otherwise renewed; or
16.3 PARTY A and PARTY B mutually agrees in writing.
17. This Agreement shall replace the Original Option Agreement and shall
constitute the entire agreement of the Parties with respect to the subject
matters therein and supercede and replace all prior or contemporaneous
agreements and understandings in verb or/and in writing (including but not
limited to the Original Option Agreement).
18. Any provision of this Agreement which is invalid, illegal or unenforceable
in any jurisdiction shall, as to that jurisdiction, be ineffective to the
extent of such invalidity, illegality or unenforceability, without
affecting in any way the remaining provisions hereof in such jurisdiction
or rendering that or any other provision of this Agreement invalid, illegal
or unenforceable in any other jurisdiction. The Parties shall, through
friendly consultation, make reasonable efforts to replace those invalid,
illegal or non-enforceable provisions with valid provisions that may bring
similar economic effects with the effects caused by those invalid, illegal
or non-enforceable provisions.
THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.
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IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized
representatives of the parties as of the day and year first above written in
Shanghai, People's Republic of China.
PARTY A:
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[Name of the contracting shareholder
of the affiliated entity]
PARTY B:
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[Name of the affiliated entity, the
wholly-owned foreign enterprise]
By:
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Title: Legal Representative
PARTY C:
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[Name of the PRC subsidiary]
By:
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Title: Legal Representative
EXHIBIT A
EXERCISE NOTICE
(To be signed only upon exercise of Purchase Right)
To: [Name of the contracting shareholder of the affiliated entity]
Reference is made to the Amended and Restated Exclusive Equity Purchase Option
Agreement (the "AGREEMENT") dated as of [____________], 2006 between [Name of
the contracting shareholder of the affiliated entity], [Name of the affiliated
entity, the wholly-owned foreign enterprise] and [Name of the PRC subsidiary]
("PARTY C").
The undersigned, the holder of a right to purchase the equity interest in PARTY
C pursuant to the Agreement, hereby irrevocably exercises the purchase right
granted under the Agreement for the purchase thereunder, of [____________]
percent of the total Equity Interest held in PARTY C by [Name of the contracting
shareholder of the affiliated entity].
DATED:
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By:
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Name:
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Title:
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EXHIBIT B
EQUITY TRANSFER AGREEMENT
This Equity Transfer Agreement (this "AGREEMENT") is entered into on the
____________________________ by the following parties:
1. Name: [Name of the contracting shareholder of the affiliated entity] (the
"TRANSFEROR")
Address: [____________]
2. Name: [____________] (the "TRANSFEREE")
Address: [____________]
The Transferor and the Transferee hereby agree as follows:
1. EQUITY TRANSFER
(a) The Transferor hereby agrees to transfer, pursuant to the terms and
conditions hereunder, [____________] percent ([____________]%) of the total
equity interest in [Name of the PRC subsidiary] ("XYZ"), constituting such
interest the Transferor holds in XYZ, to the Transferee. The Transferee
hereby agrees to such transfer.
(b) Following the approval or registration (whichever is earlier) of such
equity transfer by the relevant government authority (the "APPROVAL
AUTHORITY") which normally regulates and approves such transactions, the
Transferor shall cease to have any direct or indirect, formal or informal,
participation in the business and financial affairs and operations of XYZ
and, shall cease to have any rights over any tangible or intangible assets
of XYZ.
2. CONSIDERATION
Transferee shall pay for the Equity Interest by paying an amount equal to
RMB[____________] or such other amount or by way of such other methods as
permitted by the then PRC law, including but not limited by a set off of an
equivalent amount of debt owed by Transferor.
3. TRANSFEREE'S REPRESENTATIONS AND WARRANTIES
The Transferee represents and warrants that the execution, delivery and
performance of this Agreement do not contravene any law or contractual
restriction binding it.
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4. TRANSFEROR'S REPRESENTATIONS AND WARRANTIES
(a) The execution, delivery and performance of this Agreement do not contravene
any contractual restriction binding it.
(b) XYZ is a corporation duly incorporated, validly existing and in good
standing under the laws of the People's Republic of China.
(a) Subject to the approval from the Approval Authority (if any), this
Agreement constitutes its legal, valid and binding obligations enforceable
in accordance with its terms.
5. CONDITIONS PRECEDENT TO PAYMENT
Transferee's payment obligations under Article 2 of this Agreement for the
equity transfer contemplated hereunder are subject to Transferee's receipt of
evidence of satisfaction of the following conditions precedent:
(a) The Approval Authority has approved and registered this Agreement and the
equity transfer hereunder; and
(b) A valid business license for XYZ reflecting the equity transfers hereunder
(including changes to the names reflected as Legal Representative, but
without any changes to the business scope) has been issued.
6. APPORTIONMENT OF RELEVANT EXPENSES
All relevant expenses incurred in connection with the equity transfer hereunder
(including, without limitation, the accountants' fees and amendment fees for the
industry and commerce registration) shall be borne by the Transferee.
7. CONFIDENTIALITY OF THE TRANSACTION
Any information received by one party from the other party in connection with
the transfer contemplated by this Agreement shall be deemed to be confidential.
The parties hereto agree that any such information shall be used solely for the
purpose of evaluating and consummating the transfer contemplated hereby, and
that neither party shall publish through the news media or leak or disclose to
any person who is not a party to this Agreement any such information.
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8. AGREEMENT TO PERFORM NECESSARY ACTS
Each party hereto agrees to do any and all things, take any and all the actions,
perform any further acts and execute and deliver any further documents that are
reasonably necessary to carry out and effect the provisions of this Agreement.
9. RESOLUTION OF DISPUTES
(a) All disputes in connection with this Agreement shall be settled by friendly
consultations between the parties. In the event no agreement can be reached
within sixty days after one party proposes friendly consultations to settle
such dispute, either party may bring such dispute to the Shanghai Branch of
the Chinese International Economic and Trade Arbitration Commission in
Shanghai, People's Republic of China for arbitration under the then current
rules of such commission.
(b) The language used in arbitration shall be Chinese and English. Any document
used in arbitration may be written in Chinese and/or English.
(c) Any arbitration decision shall be final and all expenses for arbitration
shall be borne by the losing party.
10. GOVERNING LAWS
This Agreement shall be governed by the laws of the People's Republic of China.
11. ENTIRE AGREEMENT
Save for an amended and restated exclusive equity purchase option agreement
entered into by the Transferor and the Transferee dated [_________], 2006, this
Agreement represents the entire agreement among the parties hereto regarding the
equity transfers contemplated hereby and replaces and supersedes any other
written or oral agreements between parties on the same subject.
12. TERMS OF VALIDITY
If required by applicable law, this Agreement shall be submitted for approval to
the Approval Authority after due execution by the parties hereto and shall
become effective on the day the approval document is issued by the Approval
Authority or the said equity transfer has been duly registered, whichever date
is earlier.
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The Agreement is signed by the parties on the ____ day of ____________, 200_ in
________, People's Republic of China.
Transferor:
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[Name of the contracting shareholder]
Transferee:
By:
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Title:
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AUTHORISATION LETTER
For value received, I hereby assigns all right, title and interest in [_____]
percent ([_____]%) of the total equity interest of [Name of the PRC subsidiary
("XYZ"), a PRC limited liability company, to [_____] or such other party as
[_____] may designate in writing (the "TRANSFEREE"), and does hereby irrevocably
and unconditionally constitute and appoints any one of the directors of [_____]
to cause the respective equity interest of XYZ to be transferred to [_____] on
the records of the Administration of Industry and Commerce.
Executed this _________________________.
SHAREHOLDER:
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[Name of the contracting shareholder]
