Henan Jinding Chemical Industry Industry Co, Ltd. And Hong Kong KINFAIR Holdings Limited Stock Purchase Agreement February 19, 2006
EXHIBIT
2.3
Henan
Jinding Chemical Industry Industry Co, Ltd.
And
Hong
Kong
KINFAIR Holdings Limited
February
19, 2006
1
Table
of Contents
| Chapter 1 |
Definition
|
|
| Chapter 2 |
Purchase
of Stock
|
|
| Chapter 3 |
Statements
and Assurance of the Selling Party
|
|
| Chapter 4 |
Statement
and Guarantee of Purchasing Party
|
|
| Chapter 5 |
Responsibilities
for Breach of Statement and Guarantees
|
|
| Chapter 6 |
Confidentiality
|
|
| Chapter 7 |
Breach
of Agreement
|
|
| Chapter 8 |
Force
Majeure
|
|
| Chapter 9 |
Dispute
Resolution
|
|
| Chapter 10 |
Governing
Law
|
|
| Chapter 11 |
Miscellaneous
Provisions
|
2
This
Stock Purchase Agreement (hereinafter called ‘this Agreement’) is entered by
both parties on February 19, 2006.
| (1) |
Henan
Jinding Chemical Industry Co, Ltd, a company legally incorporated
according to laws of People’s Republic of China (‘China’), whose legal
address is ▇▇▇ ▇▇▇▇ County, ▇▇▇ ▇▇▇▇ of He Nan Province. (hereinafter
called ‘Party A’).
|
| (2) |
KINFAIR
Holdings Limited, a company incorporated according to laws of Hong
Kong,
whose legal address is New Xian Li Mansion, No. 10, ▇▇▇ ▇▇▇▇▇ Street
in
Hong Kong (hereinafter called ‘Party
B’).
|
Whereas,
| 1. |
Henan
Jinding Chemical Industry Co, Ltd (hereinafter called ‘Jinding’) is a
limited company incorporated according to laws of China, whose legal
address is ▇▇▇ ▇▇▇▇ County, ▇▇▇ ▇▇▇▇ of He ▇▇▇ Province.
|
| 2. |
Party
A agrees to transfer all the stock of Jinding to Party B to change
Jingding to be a wholly foreign invested company (hereinafter called
‘wholly invested company’). Therefore, in the principle of equality and
mutual benefits, through friendly negotiation, the Parties enter
into this
Agreement according to the laws and regulations of China and relevant
stipulations of this Agreement.
|
Chapter
1 Definition
Article
One Definition
Unless
otherwise stipulated hereof, the following terms used in this Agreement are
defined as follows,
‘China’
in this Agreement refers to People’s Republic of China, not including Hong Kong,
Macaw and Tai Wan.
3
‘RMB’
refers to Ren Min Bi, legal currency of China.
‘Approving
Authority’ refers to the governmental department who has the right to approve
this Agreement and Regulations and Bylaws of the Company according to relevant
regulations about foreign invested projects in China.
‘Regulations
and Bylaws of the Company’ refers to the Regulations
and Bylaws of Wholly Foreign Invested Henan Jinding Chemical Industry Co.
Ltd.
‘Effective
Date’ refers to the effective date of this Agreement, i.e., the day the
approving authority approves this Agreement.
‘Business
License’ refers to the business license issued to the joint company by National
Industrial and Commercial Administration Ministry or local Industrial and
Commercial Administration authorized by the National Ministry.
‘Selling
Party’ refers to Party A in this Agreement.
‘Purchasing
Party’ refers to Party B in this Agreement.
‘Both
Parties’ refers to selling party and purchasing party.
‘Third
Party’ refers to any other person, legal person, other organization or entity
other than the parties of this Agreement.
‘Related
Company’, in some aspects, refers to any company controls or controlled by the
Party. ‘Control’ means ownership of more than 50% of the votable stock or
paid-up capital of a company, or having the right to appoint or elect most
of
the directors of a company.
‘Board
of
Directors’ refer to the board of directors of Jinding company.
‘Managing
Person’ refers to general manager, deputy general manager, chief accountant and
other managing persons directly reporting to general manager.
‘Fiscal
Year’ refers to the period from January 1 to December 31 of each year.
‘Prompt
Day’ refers to the third working day after all the prerequisites stipulated in
Article Four of this Agreement satisfied.
4
Chapter
2 Purchase of Stock
Article
Two Purchase of Stock
According
to the stipulations of this Agreement, the Selling Party agrees to transfer
and
the Purchasing Party agrees to buy 100% of the stock of Jinding company (‘stock
purchased’). Stock purchased includes but not limited to the right to vote,
collect profit and appoint directors enjoyed by the Selling Party due to
ownership of the stock.
Article
Three Transfer Price
The
transfer price in this Agreement is ▇▇▇ ▇▇ ▇▇▇▇▇▇▇ (‘Total Transfer Price’),
which will be paid according to Article Six of this Agreement.
Article
Four Prerequisite for Payment of Transfer Price
If
any of
the following is not satisfied and the Purchasing Party does not renounce the
condition in writing, the Purchasing Party will not be obliged to pay the
transfer price to the Selling Party:
| (1) |
This
Agreement and Regulations and Bylaws of the company are approved
by the
approving authority, without changing any terms or conditions hereof,
or
increasing any additional obligations to any Party or the wholly
invested
company, unless the other party is informed of the change or additional
obligation beforehand and both parties agree in written.
|
| (2) |
The
wholly invested company obtains the Approval of ▇▇▇ ▇▇▇▇ Commercial
Bureau.
|
| (3) |
The
wholly invested company obtains the Approval of ▇▇▇ ▇▇▇▇ Foreign
Investment Bureau.
|
5
| (4) |
The
Business License of the wholly invested company is issued.
|
Article
Five Prompt Day
The
prompt day is the third working day after all the prerequisites in Article
Four
of this Agreement are satisfied (‘Prompt Day’).
Article
Six Payment
The
Purchasing Party should pay 10% of the total transfer price or equivalent to
the
Selling Party though remittance or other method on the prompt day; pay 50%
of
the total transfer price or equivalent to the Selling Party though remittance
or
other method after all the assets of the Selling Party are transferred to the
Purchasing Party; the remaining price should be paid in once within one year.
All the payments should be paid to the bank account in China appointed by the
Selling Party.
Chapter
3 Statements and Assurance of the Selling Party
The
Selling Party hereby makes the following statements and assurance to the
Purchasing Party that during the period between signing day of this Agreement
and the prompt day,
| (1) |
There
is no fact that may bring great or negative influence to the interests
of
the Purchasing Party or Hu Li (co-benenficial)
Stock.
|
| (2) |
There
is no document that may bring great or negative influence to the
rights
and interests of the Purchasing Party or Hu Li (co-beneficial)
Stock.
|
| (3) |
No
litigation, arbitration, other legal or administrative procedures
or
governmental investigation against the Selling Party is undergoing;
or, as
far as the Selling Party knows, there is no threat that may affect
its
ability to sign and perform this Agreement.
|
6
Article
Seven Common Statements and Assurances
| (1) |
Party
A is a limited company incorporated in China according to laws of
China.
|
| (2) |
The
Selling Party has conducted all the necessary procedures required
by the
laws and regulations to obtain all the necessary registration and
approval, thus has the legal authority to sign and perform this Agreement.
|
| (3) |
The
Selling Party has taken all the necessary actions to obtain the
authorization to sign and perform this Agreement and to ensure that
its
delegate signed on this Agreement is duly authorized and that this
Agreement is binding to the Selling Party.
|
| (4) |
The
Selling Party has fully paid the registered capital of Jinding Company.
|
| (5) |
This
Agreement shall be legally binding to the Selling Party.
|
| (6) |
All
the materials and documents relevant to Jinding Company held by the
Selling Party that may bring about concrete and negative influence
to the
Selling Party’s ability to fully perform this Agreement and that may have
concrete influence to the Purchasing Party’s intention of signing this
Agreement are revealed to the Purchasing Party by the Selling Party.
All
the materials and documents provided to the Purchasing Party are
complete
and true, without any falseness or misleading statements.
|
| (7) |
The
Selling Party’s signing and performance of the this Agreement will be
non-compliance with any laws, regulations, provisions, authorization
or
approval of governmental authorities, or any binding Agreements to
the
Selling Party, or lead to violation or non-performance of the
above
|
Article
8
Situation of ▇▇▇ ▇▇▇▇ incorporated company
| (1) |
▇▇▇
▇▇▇▇ incorporated company is legally formed according to Chinese
law and
regulations, and is operated effectively. The registered capital
of ▇▇▇
▇▇▇▇ incorporated company has already been handed
in.
|
| (2) |
All
the documents about ▇▇▇ ▇▇▇▇ incorporated company provided by seller
to
the purchaser should be real and
integrated.
|
7
| (3) |
The
assets directly or indirectly owned by ▇▇▇ ▇▇▇▇ incorporated company
must
be free of any right or claim or contract by a third party based
on
transfer, transaction, limit, option, mortgage, right of disposition,
lien, occupation or other kinds of security or right
limitation.
|
| (4) |
No
one can get the stocks of ▇▇▇ ▇▇▇▇ incorporated company based on
option or
any other agreement or arrangement or any other
reason.
|
| (5) |
The
accounting statements of ▇▇▇ ▇▇▇▇ incorporated company should be
made
based on the usual accounting principal, and all current debts and
contingent debts and capital obligations have already been properly
prepared or disclosed according to relevant law and
regulation.
|
| (6) |
The
accounting statements of ▇▇▇ ▇▇▇▇ incorporated company all truly
and
fairly reflect the financial situation of Hu Li incorporated company
by
the time of statement base date.
|
| (7) |
Besides
what has been disclosed in this agreement, account receivable listed
in
the accounting statements of ▇▇▇ ▇▇▇▇ incorporated company are in
good and
effective condition.
|
| (8) |
The
accounting records of ▇▇▇ ▇▇▇▇ incorporated company should be based
on
proper and coherent standards, and they record integrally and accurately
all the assets and business movements of ▇▇▇ ▇▇▇▇ incorporated
company.
|
| (9) |
All
the accounting statements and data of ▇▇▇ ▇▇▇▇ incorporated company
(no
matter whether they have been preserved in written form) should be
kept
separately in ▇▇▇ ▇▇▇▇ incorporated
company.
|
| (10) |
Except
what have been disclosed in this agreement, ▇▇▇ ▇▇▇▇ incorporated
company
has no other business.
|
| (11) |
▇▇▇
▇▇▇▇ incorporated company dose not violate any Chinese regulation,
rule,
order or provision.
|
| (12) |
The
seller ‘s obligations created by forming and fulfilling this agreement,
should not violate or lead to violate or be deemed to violate the
articles
of ▇▇▇ ▇▇▇▇ incorporated company or any agreement that Hu Li incorporated
company is one of its parties or any agreement or provisions by which
Hu
Li incorporated company should be bound.
|
8
Article
9
Ownership
| (1) |
The
seller is the legal solitary owner of the purchased stocks, and has
entire
authorized right and power to dispose the stocks. The purchased stocks
are
free of any future right, purchasing right, mortgage, impawn, warrant,
lien or other kinds of security or mortgage or property right: also
free
of any agreement or commitment that leads to or gives rise to future
right, purchasing right, mortgage, impawn, warrant, lien or other
kinds of
security or mortgage or property right stated as below, and free
of any
right or claim by a third person based on future right, purchasing
right,
mortgage, impawn, warrant, lien or other kinds of security or mortgage
or
property right stated as below.
|
| (2) |
▇▇▇
▇▇▇▇ incorporated company has well possession of its business, assets
and
rights and interests, and has entire authorized right and power to
dispose
its assets and rights and interests. Any asset of ▇▇▇ ▇▇▇▇ incorporated
company is free of any future right, purchasing right, mortgage,
impawn,
warrant, lien or other kinds of security or mortgage or property
right;
free of free of any agreement or commitment that leads to or gives
rise to
future right, purchasing right, mortgage, impawn, warrant, lien or
other
kinds of security or mortgage or property right stated as below,
and free
of any right or claim by a third person based on future right, purchasing
right, mortgage, impawn, warrant, lien or other kinds of security
or
mortgage or property right stated as
below.
|
| (3) |
In
order to possess their assets and have their rights, the seller and
▇▇▇
▇▇▇▇ incorporated company have already get all registration and
ratification, no matter whether they come from government or company,
and
for the purpose of owning those assets and/or having those rights,
there
is no need to get permission from Chinese government or agreement
by any
third party, or show their agreements to Chinese government, or pay
any
kind of fee or cost to Chinese government or any third
party.
|
9
| (4) |
There
is not any issue that may give side influences to assets and rights
and
interests owned by ▇▇▇ ▇▇▇▇ incorporated company.
|
(5)
▇▇▇
▇▇▇▇ incorporated company has already got and entirely preserved all the
property right documents and other relevant documents relating to the main
properties and rights and interests owned by each other.
(6)
The
right to use land and/or housing ownership of ▇▇▇ ▇▇▇▇ incorporated company
are/is in good and legal condition, and free of any illegal things, and all
the
due rents, taxes and other items (if there has any) that should be paid to
those
rights above have already been paid, and all the relevant agreement, provision,
obligation, term and contract have already been fully and legally preserved
and
fulfilled.
(7)
The
projects that ▇▇▇ ▇▇▇▇ incorporated company have already built or will build
should confirm with Chinese law and regulation as well as the requirement set
up
by Chinese government in every aspect.
Article10
Debts and obligations
(1)
Except debts that arise in the normal business movements and have been disclosed
in the accounting statements, ▇▇▇ ▇▇▇▇ incorporated company has no other debt
or
obligation, and all loan conditions of Hu Li incorporated company meet the
normal needs of commercial loan, or even more preferential.
(2)
Up to
the account day, except the debts listed in each accounting records, ▇▇▇ ▇▇▇▇
incorporated company does not have any other grave responsibility, including
any
real or contingent tax obligations or any obligation based on arrangement or
agreement of security, compensation or warrant, or obligations that the company
promise to fulfill to a third party.
10
(3)
▇▇▇
▇▇▇▇ incorporated company has not received any repayment notice relating to
any
loan or other loan contract, and there are no future items that violate the
contract relating to any loan or other loan contract.
(4)
▇▇▇
▇▇▇▇ incorporated company has not made or provide any loan, financial support,
warrant, letter of guarantee or other kind of security to any other
company(including affiliate company).
Article
11 Requirements of supervision and registration
| (1) |
According
to requirements of relevant registration agency or other agencies,
▇▇▇
▇▇▇▇ incorporated company has all the reports, decisions, applications
or
other required documents handed in and registered in a proper
way.
|
| (2) |
All
the decisions made by the board of directors of ▇▇▇ ▇▇▇▇ incorporated
company have already been recorded legally and accurately, and there
are
not unrecorded decisions.
|
Article12
Taxes
| (1) |
▇▇▇
▇▇▇▇ incorporated company complies with any tax law and regulations
that
apply to it, and according to those tax law and regulations preserves
relevant tax records and documents.
|
| (2) |
Every
year, according to relevant Chinese tax law and regulation, all tax
declaration sheets of ▇▇▇ ▇▇▇▇ incorporated company should have been
handed in in time; and every important aspect of all the tax declaration
sheets should be appropriate and accurate, and relevant tax
administrations have not made big adjustment to that tax declaration
sheet.
|
Article13
Entrust, manager and deputy
▇▇▇
▇▇▇▇
incorporated company dose not make any entrust or special authorization
(including entrust of bank) which exceeds the need of normal operation, and
not
authorize any single person with the power of attorney by any agreement or
arrangement.
11
Article
14 Legality
| (1) |
There
is no exceeding his authority, unauthorized, or illegal indeed, agreement
or right of ▇▇▇ ▇▇▇▇ incorporated
company.
|
| (2) |
All
the fatal documents of ▇▇▇ ▇▇▇▇ incorporated company coming into
being in
the operation, should be preserved, if they have been
sealed.
|
Article
15. Agreement
Jinding
Incorporation has not served any notice related to its important agreements,
important property, or violation or breach of contract, or violation of any
important laws or other responsibilities
Article
16 Employees
| (1) |
Directors,
managerial personnel or proxies of Jinding Incorporation have never
lodged
claims for compensations against Jinding Incorporation due to termination
of employment relations or any other reasons. And Jinding Incorporation
has never provided loans or any other fringe benefits to such directors,
managerial personnel or proxies besides such fringe benefits as shall
be
provided to them according to law.
|
| (2) |
The
employment of formal employees of Huli Incorporation and its employing
conditions are consistent with provisions of Chinese law and
rules.
|
Article
17. Bankruptcy/Lawsuit
| (1) |
All
or part of the businesses or properties of Jinding Incorporation
have not
been taken over by any receiver.
|
| (2) |
There
is not any appeal to terminate or dissolve Jinding Incorporation,
or any
resolutions to liquidate or dissolve Jinding Incorporation that have
been
made or passed.
|
12
| (3) |
No
termination of payment or insolvency referred to in relevant laws
and
rules exists in any Jinding
Incorporation.
|
| (4) |
Jinding
Incorporation does not have any pending judgment of grave influence
on its
operation with itself being the
defendant.
|
| (5) |
Jinding
Incorporation does not have any ongoing or impending lawsuits,
arbitration, charges or any other legal proceedings, nor does it
have any
ongoing appeals or lawsuit (including criminal and civil lawsuits)
or
those that need to be terminated or those of threat to itself against
Jinding Incorporation, for which it shall be responsible or which
it is
related to.
|
| (6) |
Jinding
Incorporation or its directors or managerial personnel do not have
any
violation of law listed below:
|
| (i) |
Criminal
acts or illegal acts related to business of Jinding
Incorporation
|
| (ii) |
Violation
of commitment related to business and activities of Jinding
Incorporation
|
| (iii) |
Violation
of agreement or legal obligations or infringement on rights on the
part of
the seller or others, which may entitle the third party to terminate
any
agreement with Jinding Incorporation being one party thereof, or
may cause
appeals or bans against Jinding
Incorporation.
|
Article
18. Intellectual Property Rights
Operation
of Jinding Incorporation will not infringe upon any intellectual property rights
of any other persons, and it has paid all the royalties or expenses that shall
be paid according to relevant license agreements.
Article
19. Arrangement between Associated Companies
Besides
the associated transactions that have been revealed, there is not any other
agreement or arrangement between Jinding Incorporation and its associated
companies.
13
Article
20. Operation after Date of Signing
From
the
date of signing to the prompt day, Jinding Incorporation:
| (1) |
has
not announced or granted any dividends or other distributions besides
the
distribution or dividends revealed in the
agreement.
|
| (2) |
is
carrying out and will continue normal businesses and
operation.
|
| (3) |
No
grave negative changes have occurred to its financial
status.
|
| (4) |
No
great depreciation or losses have occurred to the net value of its
tangible assets.
|
| (5) |
No
great changes have occurred to its liabilities or probable
responsibilities;
|
| (6) |
has
not signed any transactions that have caused or will cause
responsibilities of Huli Incorporation for its taxes(or such taxes
shall
be exempted, reduced, deducted or offset even though there are or
may be
such transactions
|
| (7) |
Jinding
Incorporation has not signed any agreements beyond its normal
businesses.
|
Chapter
4
Statement and Guarantee of Purchasing Party
Article
21. Statement and Guarantee of Purchasing Party
The
purchasing party has hereby made the following statements and guarantees to
the
seller from the date of signing the agreement to the prompt day
thereof:
| (1) |
The
purchasing party is a limited liabilities company formally established
according to law in effective duration and normal
operation.
|
| (2) |
The
purchasing party has handled all the necessary formalities according
to
the laws and rules it shall abide by, and has obtained all the necessary
registration and approval as well as have necessary rights under
such laws
and rules to sign the agreement and perform various obligations under
such
agreement.
|
| (3) |
The
purchasing party has taken all the necessary internal actions to
obtain
authorization for itself to sign and perform the agreement. The
representative that signs on the agreement has obtained full authority
to
sign the agreement and make the purchasing party bound by the
agreement.
|
14
| (4) |
The
agreement shall have legal binding force on the purchasing party
from the
date of signing.
|
| (5) |
The
purchasing party signing the agreement and performing its obligations
under such agreement will not conflict with the by-laws, internal
regulations, any laws, rules, regulations, or authorization or approval
of
any government agencies or departments, or any agreements with the
purchasing party being one party thereof or binding the purchasing
party
or any provisions thereof, or lead to violation of the aforesaid
regulations, or non-performance of the aforesaid
provisions.
|
| (6) |
There
is not any ongoing lawsuit, arbitration, other legal or administrative
proceedings or government investigations against the purchasing party,
or
any threat influencing its capacities of signing or performing the
agreement as far as the purchasing party knows.
|
| (7) |
The
materials in all the materials related to the sole incorporation
held by
the purchasing party, which have substantial or adverse influence
on the
purchasing party`s capacity of performing all of its obligations
under the
agreement, or those that will have substantial influences on the
will of
the other party to sign the agreement if disclosed to the other party,
have been disclosed to the other party., and the materials provided
by the
purchasing party to the other party do not contain any substantial
unfaithful or misleading
statements.
|
| (8) |
The
purchasing party guarantees payment of the transferring price according
to
provision of the agreement.
|
Chapter
5 Responsibilities for Breach of Statement and Guarantees
Article
22.
Responsibilities for Breach of Statement and Guarantees
In
case
any mistakes, misses, misleading or unfaithful parts are discovered in any
part
of the aforesaid statement or guarantee of either party within two(2) years
from
the date of signing the agreement, the other party shall be entitled to require
the party violating the statement or guarantee to make full compensation for
such losses, damages, cost or expenses.
Chapter
6 Confidentiality
Article
23. Confidentiality
| (1) |
Either
party once disclosed or may disclose to the other party confidential
and
exclusive materials related to their own businesses and financial
status,
and other confidential issues. In addition, the two parties may obtain
the
confidential and exclusive materials related to the joint venture.
The
party receiving all the aforesaid materials(including written and
non-written materials, hereinafter referred to as “confidential
materials”), unless otherwise provided for in other non-disclosure
agreements,
|
| (i) |
shall
keep the aforesaid confidential materials in
secrecy.
|
| (ii) |
shall
not disclose the aforesaid confidential materials to any personnel
or
entities other than the employees of its own that need to know the
aforesaid confidential to perform their
duties.
|
| (2) |
The
provision of the aforesaid item(1) does not apply for the following
confidential materials:
|
| (i) |
The
written record made before the party disclosing materials to the
receiving
party can prove the materials known to the
receiver.
|
| (ii) |
The
materials known to the public due to reasons other than violation
of the
agreement by the receiver
|
16
| (iii) |
The
materials the receiver obtains from any third party that does not
undertake any confidentiality obligation for the confidential
materials.
|
| (3) |
Either
party, if requested by the other party, shall sign a non-disclosure
agreement separately for the confidential materials obtained from
the
other party or its associated companies, and the provisions therein
shall
be similar to those provided for in Chapter 6.
|
| (4) |
Either
party shall make out rules and regulations to make itself and the
directors, senior staffs and other employees to abide by the
confidentiality obligation stated in Chapter 6
too.
|
| (5) |
The
provisions in Chapter 6 do not apply for any third party disclosing
materials to any associated companies, any public or private loaners,
or
financial funding agent or institution, employees, consultants of
the two
parties, or that to which either party is expected to transfer all
of part
of its rights or obligations under the agreement, and in this case,
such
materials can only be disclosed to personnel or entities that need
to know
such materials as duly required by business, provided that such personnel
and entities shall make commitment in writing to keep such materials
in
secrecy.
|
In
case
the aforesaid materials are required to be disclosed according to law, the
provisions in Chapter do not apply for disclosing materials to any government,
or any relevant agency or departments. And the party required to make the
aforesaid disclosure shall notify the other party of such requirement and its
provisions immediately before the aforesaid disclosure. The other party shall
be
entitled to put forth its objection to disclosure of the aforesaid materials
to
relevant agency or department, and seek the provisions it may determine with
full power to keep any confidential materials to be disclosed in
secrecy.
| (6) |
Without
any restriction to the aforesaid provisions in Chapter 6, either
party
shall not publish or publicly disclose materials related to the joint
venture(including confidential materials) unless it obtains the written
approval of the other party for the contents to be publishd or publicly
disclosed and the time thereof, provided that any provision of the
item(6)
shall not hinder the publishing or disclosure consistent with regulations
of law, rules or regulations of securities exchanges it has made
according
to its judgment made in good faith.
|
17
| (7) |
As
far as any natural person or legal person that was once one party
of the
agreement is concerned, the provisions of the Chapter 6 still have
binding
force after it transfers its rights and obligations under the agreement
and is no longer one party of the
agreement.
|
Chapter
7 Breach of Agreement
Article
24: Breach of Agreement
(1)
Where
Party B fails to pay Party A the price of equity transfer in accordance with
the
stipulation specified in Article 6 hereof, Party B may pay Party A the price
of
equity transfer within thirty (30) days (“grace period”) from the delivery date
specified in Article 6 hereof, but it shall pay Party A a default fine amounting
to 0.03% of the sum unpaid per day. The total amount of default fine shall
be
calculated in accordance with the actual overdue days. In case that Party B
fails to pay Party A the total price of equity transfer within the grace period,
Party A shall have the right to rescind this Agreement and require Party B
to
indemnify all losses suffered by Party A arising from such default.
(2) Where
any
Party hereto breaches this Agreement, it shall be liable for the breach of
agreement in accordance with this Agreement and applicable laws. In case that
both Parties breach this Agreement, they shall bear the liabilities
respectively. Notwithstanding the above stipulation, any Party hereto shall
not
liable to the other Party for any indirect losses or damages.
Chapter
8 Force Majeure
Article
25: Force majeure
(1)
Force
majeure means any unforeseeable event beyond the reasonable control of the
Parties taking place after the signing of this Agreement, which prevents any
Party from performing any of its obligations under this Agreement, in whole
or
in part. An event of force majeure includes, but is not limited to, earthquake,
typhoon, flood, fire, war, interruption of transportation at home or abroad,
government actions, epidemic ,civil riot, strike, and other events being deemed
as events of force majeure in accordance with general international commercial
practice. Lack of funds shall not be interpreted as an event of force
majeure.
(2)
If an
event of force majeure occurs, which prevents the affected Party from performing
any of its obligations under this Agreement, in whole or in part, the affected
Party shall has the right to stop performing its obligations under this
Agreement within the delayed period by reasons of force majeure and shall not
be
deemed a breach of this Agreement.
(3)
The
Party affected by an event of force majeure, shall notify the other Party in
writing without delay and, within fifteen (15) days thereafter, provide detailed
information regarding the event of force majeure and sufficient proof
thereof.
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(4)
If an
event of force majeure occurs, The Parties shall consult with each other without
delay to find a fair solution and shall make all reasonable efforts to minimize
or remove the effects of the event of force majeure. In case when events of
force majeure last more than six (6) months and no fair solutions have been
found by the Parties, any Party shall have the right to terminate this Agreement
by notifying the other party and shall not be responsible for any damage or
loss
because of its failure in performing this Agreement in whole or in part.
Chapter
9 Dispute Resolution
Article
26: Arbitration
Any
dispute arising from, out of, or in connection with, the execution of this
Agreement, shall be settled by the Parties through friendly consultation. In
case no settlement can be reached within sixty (60) days after the beginning
of
the consultation, any Party may submit the dispute to China International Trade
Arbitration Committee in Beijing to be arbitrated according to its rules and
regulations. There shall be three (3) arbitrators, all of whom shall be fluent
in both English and Mandarin. Party A and Party B shall appoint one (1)
arbitrator each. The two arbitrators appointed respectively by the Parties
hereto as aforesaid thus appointed shall thereupon select a third arbitrator.
In
the further event that the two arbitrators appointed respectively by the parties
hereto as aforesaid should be unable to reach agreement on the appointment
of
the third arbitrator, the chairman of the Arbitration Committee shall select
the
third arbitrator to be the chief arbitrator.
Article
27: Award of Arbitration
The
award
of arbitration shall be final and binding upon both Parties and shall be
enforced in accordance with its terms.
Article
28: Expenses
Unless
otherwise specified in the arbitral award, the arbitration fees shall be borne
by the losing Party.
Article
29: Continue to Implement this Agreement during Arbitration
During
the period when a dispute is being arbitrated, the Parties shall continue to
implement this Agreement in all respects, except for the matters in
dispute.
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Chapter
10 Governing Law
Article
30: Governing Law
The
formation of this Agreement, its validity, interpretation, execution and all
disputes in connection herewith, shall be governed by the laws of the People’s
Republic of China. In the event that there is no publicly available law in
the
People’s Republic of China governing a particular matter relating to this
Agreement, reference shall be made to general international commercial
practices.
Chapter
11 Miscellaneous Provisions
Article
31: Waiver
Failure
on the part of any Party to exercise any right under this Agreement shall not
operated as a waiver thereof, nor shall any single or partial exercise of any
right preclude any other or future exercise thereof.
Article
32: Assignment
Unless
otherwise specified in this Agreement, neither Party hereto shall assign this
Agreement or any of its rights and obligations hereunder without the other
Party’s prior written consent or without the approval of examination and
approval authorities provided that such assignment is required to be approved
in
accordance with the law.
Article
33: Amendment
This
Agreement is entered into for the interests of Selling Party and Purchasing
Party and their legal successors and for the interests of each Transferee and
shall be binding upon all of them. This Agreement shall not be amended in the
oral manner. No amendment to this Agreement shall be effective unless made
in
writing and signed by all of the Parties and approved by examination and
approval authorities provided that such amendment is required to be approved
in
accordance with the law.
Article
34: Severability
If
any of
the provisions of this Agreement is held invalid, such invalidity shall not
affect in any way the validity of any other provisions of this Agreement.
Article
35: Validity of Counterparts
This
Agreement is executed in four (4) originals and three (3) copies. The Selling
Party and the Purchasing Party shall respectively hold one (1) original. Two
other originals shall submit to examination and approval authorities and the
competent administration of industry and commerce, respectively. The wholly
foreign-funded company shall keep the copies of this Agreement for record.
Provided that if relevant competent departments require copies of this
Agreement, Party A and Party B may sign several copies of this
Agreement.
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Article
36: Notices
Unless
otherwise specified in this Agreement, notices and other written communications
between the Parties shall be written in Chinese and shall be delivered by
courier service or sent by facsimile transmission and shall be confirmed by
the
letter delivered by the courier service company. Such notices shall be deemed
to
have been effectively given on the following dates: (1) Notices sent by courier
service shall be deemed to have been effectively given within seven (7) working
days after they were sent out; (2) Notices sent by facsimile transmission shall
be deemed to have been effectively served within three (3) working days after
they were sent out. The confirmation report of the successful transmission
shall
be provided as evidence and the aforesaid confirmed letter shall be sent out.
All
notices and other communications shall be delivered to the following addresses,
unless notice of change of address is provided in writing to the other
party:
Selling
Party: Henna Jinding Chemical Industry Co., Ltd
Address:
▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇.
Fax
number:
▇▇▇▇-▇▇▇▇▇▇▇
Purchasing
Party: KINFAIR
Holdings Limited
Address:
▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇
▇▇▇▇▇
▇▇▇▇▇,
▇▇
Ice
House Street, Central. Hong Kong.
Fax
number: 00852—2845 0504
Mail
receiver: Su Ziying
Article
37: Entire Agreement
This
Agreement constitutes the entire agreement between the Parties in respect of
the
subject matter set our herein and shall supercede any and all previous
discussions, negotiations and agreements between the Parties relating to such
subject matter.
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IN
WITNESS WHEREOF, the duly authorized representatives of each of the Parties
hereto have caused this Agreement to be executed the day and year first written
above.
Selling
Party: Henna Jinding Chemical Industry Co., Ltd
Signature:
/s/ Zhou ▇▇▇▇ ▇▇▇▇▇
Purchasing
Party: KINFAIR
Holdings Limited
Signature:
/s/ KINFAIR Holdings Limited
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