SALE AND PURCHASE AGREEMENT IN RELATION TO THE OWNERSHIP INTEREST OF HANGZHOU HOLLYSYS AUTOMATION CO., LTD. BETWEEN TEAM SPIRIT INDUSTRIAL LIMITED AND GIFTED TIME HOLDINGS LIMITED
IN
RELATION TO THE OWNERSHIP INTEREST
OF
HANGZHOU
HOLLYSYS AUTOMATION CO., LTD.
BETWEEN
TEAM
SPIRIT INDUSTRIAL LIMITED
AND
GIFTED
TIME HOLDINGS LIMITED
Dated:
January 12, 2006
A3
This
SALE AND PURCHASE AGREEMENT
(Hereinafter referred as “this Agreement”) is entered into on the 12th
day of
January 2006.
BETWEEN:-
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(1)
|
TEAM
SPIRIT INDUSTRIAL LIMITED,
(Hereinafter referred as “Party A”), a company incorporated in the British
Virgin Islands with limited
liability;
|
|
(2)
|
GIFTED
TIME HOLDINGS LIMITED,
(Hereinafter referred as “Party B”), a company incorporated in the British
Virgin Islands with limited
liability.
|
(Party
A
and Party B may be called “Party A and B” or “both Parties” together, or “the
Party” or “each Party” under this Agreement)
WHEREAS:-
| (A) |
As
of the date of this Agreement,
Party A is the registered owner of Hangzhou HollySys Automation Co.,
Ltd.
(Hereinafter referred as "HZ HollySys") holding 30% of the entire
ownership interest in HZ HollySys;
and
|
| (B) |
Party
A agrees that Party A shall sell 30% ownership interest in HZ HollySys
to
Party B in accordance with the conditions set forth in this Agreement.
Party B agrees that Party B shall purchase the 30% ownership interest
in
HZ HollySys.
|
Therefore,
Party A and Party B enter into this Agreement based on the following
conditions:-
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1.
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DEFINITIONS
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1.1
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In
this Agreement, unless otherwise expressed or required by context,
the
following words and expressions shall have the respective meanings
set
opposite thereto as follows:-
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Expression
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Meaning
|
|
"Agreement"
|
Sales
and Purchase Agreement dated [12th January 2006] and its appendix
entered
into between the Party A and Party
B
|
|
"HZ
HollySys"
|
Hangzhou
HollySys Automation Co., Ltd. Party A holds 30% of the entire
ownership
interest in HZ HollySys
|
|
"Transaction"
|
the
transaction with respect to the sale and purchase of the
30% ownership
interest in HZ HollySys between Party A and Party B in accordance
with the
conditions set forth in this
Agreement
|
|
"Sale
Share"
|
the
fully paid share which is legally and beneficially owned
by Party A,
representing 30% of the entire issued share capital of
HZ HollySys as at
the date of this Agreement
|
|
"Consideration"
|
the
agreed total consideration payable by Party B to
Party A for the sale and
purchase of the Sale Share in accordance with the
condition 3 set forth in
this Agreement
|
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"Signature
Date"
|
the
official date for signature of this Agreement
stated in this
Agreement
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"Effective
Date"
|
the
date upon the fulfillment of all the conditions
specified in this
Agreement
|
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"Business
Day"
|
a
day on which banks are open for business
other than (i) a Saturday or a
Sunday; or (ii) a "general holiday"
|
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"RMB"
|
Renminbi,
the legal currency of the P.R.China
|
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2.
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SALE
AND PURCHASE OF THE SALE SHARE
|
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2.1
|
Party
A agrees that Party A shall sell the Sale Share to Party B in accordance
with the terms and conditions set forth in this Agreement. Party
B agrees
that Party B shall purchase the Sale Share in accordance with the
terms
and conditions set forth in this
Agreement.
|
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3.
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CONSIDERATION
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3.1
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Both
Parties agree that the total consideration payable by Party B to
Party A
for the sale of the Sale Share shall be RMB
60,474,000.
|
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3.2
|
Both
Parties agree that Party B shall pay the consideration of the Sale
Share
to Party A or any third party designated by Party A by issuing
common
stock with equivalent value of the Sale Share, representing 7,966
shares
of Party B’s common stock, which take 15.932% of its total outstanding
stocks.
|
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4.
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PARTY
A’S RIGHTS AND OBLIGATIONS
|
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4.1
|
Party
A has the right, power and authority to sell and transfer the Sale
Share.
|
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4.2
|
Party
A is the sole beneficial owner of the Sale Share which shall be
transferred and assigned to Party B pursuant to the terms of this
Agreement free from all claims, charges, liens, encumbrances, third
party
rights, disputes, litigations and arbitrations of any kind
whatsoever;
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4.3
|
Party
A has not entered into any contracts or agreements which may
conflict with
this Agreement. Party A shall not transfer any rights and obligations
under this Agreement to any third party.
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4.4
|
Party
A agrees to take all and any necessary actions, executes and
delivers any
legal documents (including any necessary approvals from the
government
authorities) to complete the transaction
hereunder.
|
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5.
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PARTY
B’S RIGHTS AND OBLIGATIONS
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5.1
|
Party
B is fully capable of entering into this Agreement and performing
all
obligations and duties hereunder;
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5.2
|
Party
B shall fully pay the consideration to Party A in time pursuant
to the
terms in this Agreement.
|
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5.3
|
Party
B has not entered into any contracts or agreements which may
conflict with
this Agreement. The Purchase shall not transfer any rights and
obligations
under this Agreement to any third
party.
|
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5.4
|
During
the period from the signature date of this Agreement to the
completion
date of the transaction hereunder, Party B agrees that Party
B shall not
propose or enter into any negotiations or discussions or enter
into any
letter of intend, agreements or understandings which may conflict
with the
transaction hereunder.
|
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6.
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DEFAULT
|
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6.1
|
After
effective date of this Agreement, it may constitute default,
if either
Party is in breach, nonperforming, or partly performing
terms of this
Agreement, or is in breach of any warranties, representations
and
undertakings of this Agreement. The non-defaulting Party
can allow the
defaulting Party to cure such default in a reasonable time
period. If the
defaulting Party does not cure within the reasonable time
period, the
non-defaulting Party shall be entitled to terminate the
Agreement, and
hold the defaulting Party liable for all the damages and
economic loss
resulting from the defaulting Party’s default. The economic loss shall not
exceed the amount that defaulting Party could anticipate
or should
anticipate as of the date of this
Agreement.
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7.
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FORCE
MAJEURE
|
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7.1
|
Neither
Party shall be liable to the other for any delay
or failure to perform its
obligation under this Agreement, if such failure
or delay is due to force
majeure.
|
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8.
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GOVERNING
LAW AND DISPUTE
RESOLUTION
|
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8.1
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Any
dispute arising out of this Agreement shall be resolved by both Parties
through mutual negotiation. If both Parties could not reach an agreement,
either Party may initiate legal action in the competent
jurisdiction.
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8.2
|
This
Agreement shall be governed by and construed in accordance with the
laws
of PRC.
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9.
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EFFECTIVE
|
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9.1
|
Upon
and after all of the following conditions have been satisfied and
fulfilled, this Agreement shall come into
effective:
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9.1.1
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This
Agreement has been signed by both Parties’ legal representatives or
authorized persons;
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9.1.2
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The
transaction in this Agreement has been approved by the
Board of HZ
HollySys;
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9.1.3
|
This
Agreement has been approved by the original government
authorities.
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10.
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CONFIDENTIALITY
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10.1
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Save
as required by any applicable law, court order or other regulatory
requirements, none of the parties hereto shall make, any press or
other
announcement or release or disclose any information, document and
data
concerning this Agreement or the transaction herein referred to or
disclose the identity of the other parties hereto (save disclosure
to
their respective professional advisers under a duty of confidentiality)
without the prior written consent of the other parties
hereto.
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11.
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MODIFICATION,
TERMINATION, SUPPLEMENTARY
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11.1
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The
modification of this Agreement shall not be effective without
written
agreement through negotiation. If both Parties could not reach
an
agreement, this Agreement remains effective. Any modification,
construction or renunciation to this Agreement shall be invalid
if without
a written agreement signed by both
Parties.
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11.2
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If
either party is in breach of this Agreement, non-default party
may
terminate this Agreement. Both Parties may agree to cancel
this Agreement
with written agreement.
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11.3
|
This
Agreement may terminate in the following circumstances: (i)
Both Parties
agree to terminate this Agreement; (ii) Non-default party
terminates this
Agreement pursuant to the terms and conditions of this Agreement;
(iii)
the transaction under this Agreement has been
completed.
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11.4
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Both
Parties may sign supplemental agreement regarding to related
matters of
this Agreement. Supplemental agreement and this Agreement
have the same
effect.
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12.
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MISCELLANEOUS
|
This
Agreement is executed in four copies, two copies for each Party, and both
Parties may execute the duplicate.
IN
WITNESS WHEREOF, the Parties hereto have caused their duly authorized
representatives to execute this Agreement.
| /s/ Cheng Wusi | |||
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For and on behalf of
TEAM SPIRIT INDUSTRIAL
LIMITED
in the presence of Director
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| /s/ Xxxx Xx | |||
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For and on behalf of
GIFTED TIME HOLDINGS
LIMITED
in the presence of Director
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