C3 Capital, Limited And Gao Zhigang In matter of Xinjiang Ehe Mining and Metallurgy Co., Ltd. Enter Into Equity Interest Transfer Contract August, 2008
C3
Capital, Limited
And
▇▇▇
▇▇▇▇▇▇▇
In
matter of
Xinjiang
Ehe Mining and Metallurgy Co., Ltd.
Enter
Into
August,
2008
Contents
| Chapter I |
Definitions
of the Contract
|
4
|
| Chapter II |
Object
Equity Interest
|
6
|
| Chapter III |
Price
of Equity Interest Transfer
|
6
|
| Chapter IV |
Capital
Increase
|
7
|
|
|
||
| Chapter V |
Approval
and Checking
|
8
|
| Chapter VI |
Assumption
of Debts of Object Company
|
10
|
| Chapter VII |
Employees
|
11
|
| Chapter VIII |
Rights,
Obligations and Guarantees of Party B
|
11
|
| Chapter IX |
Rights,
Obligations and Guarantees of Party A
|
13
|
| Chapter X |
Performance,
Wind-up and Termination
|
14
|
| Chapter XI |
Representations
and Statements of Party B
|
15
|
| Chapter XII |
Representations
and Statements of Party A
|
17
|
| Chapter XIII |
Confidentiality
|
17
|
| Chapter XIV |
Liability
for Breach of Contract
|
18
|
| Chapter XV |
Force
Majeure
|
20
|
| Chapter XVI |
Disputes
Settlement
|
20
|
| Chapter XVII |
Applicable
Law
|
21
|
| Chapter XIX |
Miscellaneous
|
21
|
2
The
equity interest transfer contract (hereinafter referred to as “Contract”) is
made and entered by and among:
Party
A:
C3
Capital Limted, a company registered and established under the BVI Business
Companies Companies Act 2004 and incorporated on October 25th
2007,
its registration number is 1439706.
Party
B:
▇▇▇
▇▇▇▇▇▇▇, the
citizen of People’s Republic of China, ID No. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇; his domicile
is Renmin ▇▇▇▇▇▇ ▇▇. ▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇.
WHEREAS:
| 1. |
Xinjiang
Ehe Mining and Metallurgy Co., Ltd (the “Object Company”) was established
on August 7th, 2007. It plans to construct the project of 40,000
tons
green silicon carbide (the “Carborundum Project”) in Aletai Area of
Xinjiang Uygur Autonomous Region. The procedures of project proposal,
environmental protection, land use, resources use, planning, etc
is being
conducted, and construction has not yet been
started.
|
| 2. |
The
registered capital for the Object Company is RMB 1 million. The
shareholder is Party B and Changchun Masite Industry Co., Ltd (the
“Changchun Maisite Company”), and Party B holds 90% of the equity
interest.
|
| 3. |
Party
B plans to transfer to Party A all its holding shares of the Object
Company (“the Object Equity Interest”). Party A intends to accept
the equity interest. After Party A completes the transfer of equity
interest, the Object Company will become Chinese-foreign joint
venture.
|
3
According
to the principle of equality and mutual benefit and through friendly
consultation, Party A and Party B agree
on
the following terms and conditions in accordance with,
the
Contract Law of the People’s Republic of China,
and
other applicable Chinese laws and regulations. The parties will abide by and
fulfill the Contract in good faith.
Chapter
I Definitions of the Contract
Article
1 Definition
The
terms
hereinafter used in the Contract shall have the meanings set forth as
follows:
| 1.1 |
“Industrial
and commercial administration”
(AIC) means the industrial and commercial administration of People’s
Republic of China which performs the job of business registration
and
issues business license.
|
| 1.2 |
“Department
of Commerce”
means Ministry of Commerce of People’s Republic of China, or so far as the
examination and approval is concerned, the local department of commerce
with competent power of examination and
approval.
|
| 1.3 |
“Development
and Reform Department” means
national Development and Reform Committee and local Development and
Reform
Committee of different levels.
|
| 1.4 |
“Foreign
Exchange Administration”
means the State Administration of Foreign Exchange and local foreign
exchange administrations at all
levels.
|
| 1.5 |
“Examination
and Approval Authority”
means the relevant Chinese governmental departments having authority
defined by relevant Chinese laws, regulations, regulatory rules and
policies to examine and approve the Contract, the equity interest
transfer
and the capital increase, including but not limited to Ministry of
Commerce (MOC), National Development and Reform Commission (NDRC),
State
Administration of Foreign Exchange (SAFE), Industrial and Commercial
Administration (AIC), etc.
|
4
| 1.6 |
“Capital
Increase”
means, after Party A accepts the equity interests of the Object Company
from Party B, Party A puts additional registration capital into the
Object
company.
|
| 1.7 |
“Closing
date”
means the date on which the Object Equity Interest Transfer has performed
the formality of alteration registration with the industrial and
commercial administration, subject to the date on which the industrial
and
commercial administration has performed examination and approval
procedure
and issued new business license to the Object
Company.
|
| 1.8 |
“New
Business License”
means the new business license issued by the industrial and commercial
administration to the Object Company after completion of the Equity
Interest Transfer.
|
| 1.9 |
“Disclosed
Information”
means the related materials, explanation, statement and other information
disclosed or made by Party B to Party A or its designated intermediaries
during Party A’s due diligence investigation of the object company, the
Carborundum project and the object equity interest; or the information
disclosed by the Party B to Party A in relation to the object company,
the
Carborundum project and the object equity
interest.
|
| 1.10 |
“Employees”
mean all personnel who work in the Object Company and have employment
relations with or de facto employment relations with the Object
Company by
the date the contract is
executed.
|
| 1.11 |
“Encumbrance”
shall
mean any mortgage, pledge, other security interest, assignment, lien,
charge, option, trust interest, pre-emptive right, lease and any
other
restrictions or conditions.
|
| 1.12 |
“Force
Majeure”
means the special events such as earthquake, typhoon, flood disaster,
fire
disaster, war, political disturbance, etc., or the events defined
by
Chinese laws and regulations as Force
Majeure.
|
5
| 1.13 |
“PRC”
or
“China”
means the People’s Republic of China, and insofar as the Contract is
concerned, shall exclude Hong Kong, Taiwan and
Macau.
|
| 1.14 |
“Tax”
means the state or local taxes defined by Chinese laws and regulations,
including relevant interest, fine or any other burden imposed by
any
government authorities in relation to such
taxes.
|
Chapter
II Object
Equity Interest
| Article 2 |
According
to the provision of this Contract, Party B shall sell to Party A
their
respective equity interests of the Object Company (the Object Equity
Interest) and all the related rights and interests in a way free
of any
encumbrance. Party A shall pay the equity interest transfer
price.
|
| Article 3 |
Party
B guarantees that other shareholders of the Object Company agrees
to waive
their preemption right on the Object Equity
Interest.
|
| Article 4 |
After
the transfer of the equity interest is completed as per the Contract,
Party A will hold 90% equity interest of the Object
Company.
|
Chapter
III Price of Equity Interest Transfer
| Article 5 |
The
price of the equity interest transfer will be based on the evaluation
of
the object equity interest by the assets evaluation agency. The two
parties confirm that the price of the equity interest transfer is
US
dollars of equal value of RMB 0.9 Million Yuan (“equity interest transfer
price”).
|
| Article 6 |
Party
A shall fulfill the payment obligation of equity interest price by
the
closing date. If Party A makes the payment through foreign exchange,
the
procedures legally required for payment shall be
performed.
|
6
| Article 7 |
Each
payment of the equity
interest transfer shall be conditioned on the satisfaction of the
following:
|
| 7.1 |
The
equity interest transfer have been examined and approved by all
examination and approval authorities. Party A and Party B have
duly opened
accounts used to pay and receive the price of the equity
interest.
|
| 7.2 |
Party
A has completed the Due Diligence investigation. All the issues
which have
been pointed out by Party A have been solved in a way accepted
by Party
A.
|
| 7.3 |
The
representations and statements made by Party B in the Contract
are true
and correct.
|
| Article 8 |
The
Contractual parties shall bear their respective payable taxes arising
from
the revenue or activity under the Contract according to the relevant
laws,
administrative regulations, rules and normative documents.
|
| Article 9 |
Party
B shall issue formal and valid receipt and invoice to Party
A immediately
after receiving each equity interest transfer payment from
Party A. Within
5 (five) days after receiving the equity interest transfer
payment, Party
B shall go to the local foreign exchange administration and
conduct the
registration for receiving foreign exchange from foreign investor
for the
Equity Interest Transfer, it shall procure a corresponding
certificate
which is to be provided to Party
A.
|
Chapter
IV Capital Increase
| Article 10 |
Capital
Increase Arrangement
|
After
the
transfer of the Object Equity Interest, Party A shall increase the capital
investment of the Object Company. The amount of capital increased by Party
A
shall be fixed by Party A, Party B and their shareholders according to the
construction process of the Carborundum project and fund demand
7
| Article 11 |
The
precondition for payment of increased capital
|
| 11.1 |
The
Equity Interest Transfer has been approved by the examination and
approval
authorities and the Object Company has obtained Approval Certificate
for
Foreign Invested Enterprise.
|
| 11.2 |
The
statements and guarantees made by Party B in this contract are all
authentic and correct.
|
| 11.3 |
The
investment scale, construction process, operation plan etc have been
accepted by Party A.
|
| 11.4 |
Party
A has acquired the position as shareholder of the Object Company
and has
enjoyed the shareholder’s rights according to its holding of 90% shares.
The approval and handover of the Object Company has been completed
successfully.
|
| 11.5 |
The
approval procedures including the project approval, environmental
protection, land use, resources utilization, safety manufacture and
planning required for the construction and operation of the Carborundum
Project have been performed and the project construction can be started
legally.
|
| 11.6 |
The
loan of RMB 0.9 Million Yuan which Party B borrowed from the Object
Company on April 16th
2008 has been fully paid off by Party B to the Object Company. In
addition, the payment has been approved by Party
A.
|
| Article 12 |
The
increased capital shall be for the purpose of Carborundum Project
construction.
|
Chapter
V Approval and Checking
| Article 13 |
After
the execution of this Contract, Party A and Party B shall confirm
the date
for application to authorities for examination and approval. If this
equity interest transfer needs to be examined and verified by authorities
of development and reform, environmental protection, land etc, this
Contract shall be submitted to all these authorities for
approval.
|
8
| Article 14 |
Upon
the approval
of the
equity interest transfer by the examination and approval authorities,
Party A and Party B shall cooperate and immediately perform procedures
relating to the industrial and commercial alteration registration
for the
object equity interest
transfer.
|
| Article 15 |
Checking
|
| 15.1 |
Party
B promises that, after the execution of this Contract, all assets
or any
documents (including electronic data and written materials) of the
Object
Company shall be kept in full and safe condition and the checking
procedure shall be conducted.
|
| 15.2 |
Upon
the approval
of the
equity interest transfer by the examination and approval authorities,
Party
A and Party B shall form a check team and work together to do the
checking
work relating to the Object
Company.
|
| 15.3 |
The
object of checking includes but not limited
to:
|
| (1) |
All
the
official seals, financial seals and contract seals, etc of the Object
Company;
|
| (2) |
All
certificates and licenses of the Object Company;
|
| (3) |
The
assets of the Object Company;
|
| (4) |
The
financial books and the accounting records of the Object
Company;
|
| (5) |
All
documents on the archives of the Carborundum Project (including but
not
limited to the project application, feasibility study report, preliminary
design report, engineering
drawings, equipment drawings, all competent authorities’ replies, permits,
record-keeping or acceptance documents relating to the
Carborundum Project);
|
| (6) |
All
contracts for which the Object Company is one party (including but
not
limited to Engineering Construction Contract, Equipment Purchase
Contract
and Installation Contract, Electricity Provision contract, Raw Materials
Purchase Contract, Product Sales Contract and Loan Contracts)
;
|
9
| (7) |
Other
checking items reasonably required by Party
A.
|
| 15.4 |
The
checking work shall be completed within seven days upon
the approval
of the
equity interest transfer by the examination and approval
authorities.The
completion of the checking and handover work shall be confirmed by
signatures of0 both parties’ representatives.
|
| 15.5 |
After
the completion of the handover, the parties shall draw up detailed
list of
the handover items which shall be confirmed by representatives of
both
parties.
|
Chapter
VI Assumption of Debts of Object Company
| Article 16 |
Party
B shall disclose to Party A all loans
of the Object Company (including tax payable and administration cost).
Party B shall provide Party A with detailed list of the foregoing
debts
(the
list shall contain the amount of each debt, the debtor, the fulfillment
period, the guarantee condition and the names of the documents related
to
the debts, etc.).
|
| Article 17 |
It
is the responsibility of Party B to pay off all debts owed by the
Object
Company before the closing date. Party B shall perform the payment
obligation according to the deadline and the amount as agreed in
the
underlying documents of the paid-off debts. The conduct of payment
shall
be legal and valid.
|
| Article 18 |
The
debts owed by the Object Company before the closing date and undisclosed
by Party B at the time of executing the Contract shall be borne by
Party
B. If Party A or the Object Company detects that the undisclosed
debts do
exist, Party A or the Object Company is entitled to ask Party B to
immediately pay off or dispose of the debts.
|
10
| Article 19 |
In
respect of the debts owed by the Object Company before the closing
date
and agreed to be borne by Party B according to Article 17 and Article
18
of the Contract, if Party B does not pay off the debts or Party B
does not
bear the debts according to the Contract, thus causing a result that
the
related creditors make claims against the Object Company, the Object
Company or Party A is entitled to seek compensation from Party B
on the
basis of this Contract. The scope of compensation includes the debts
itself and all costs and expenses incurred by the Object Company
or Party
A in disposing of and settling the debts, including but not limited
to
litigation cost, arbitration fee, enforcement fee, attorney’s fee and
traveling costs etc.
|
Chapter
VII Employees
| Article 20 |
Within
three days upon the approval ofthe
equity interest transfer by the examination and approval authorities,
Party
B shall provide Party A with detailed list of employees and management
staffs for the Object Company (including gender, age, term of
labor
contracts, remuneration standard, position, labor contracts series
number
and etc).
|
| Article 21 |
If
the Object Company suffers from loss resulting from being claimed
by
employees for the disputes arising before the delivery date between
the
Object Company and employees, Party A has the right to recover
it from
Party B.
|
Chapter
VIII
Rights, Obligations and Guarantees of Party B
In
addition to the
rights,
obligations and guarantees of Party B as
specified
by other clauses of the Contract, Party B shall enjoy rights, bear obligations
and provide guarantees as per the following provisions of this chapter:
11
| Article22 |
Except
as otherwise provided by this Contract, upon
execution of the Contract, no act shall be performed which leads
to or may
lead to loss or damage of the assets, rights and interests of the
Object
Company.
|
| Article23 |
Upon
execution of the Contract, Party B shall not pledge, transfer or
put into
trusteeship its holding equity interest of the Object Company or
do any
other act which may affect Party A’s procurement of the object equity
interest
|
| Article24 |
Upon
execution of the Contract, Party B guarantees that: it will operate
and
manage the Object Company in normal matter with duty of care of a
kindhearted administrator, including but not limited to: (1) not
to change
the documents for establishing the Object Company; (2) not to change
the
financial policies of the Object Company; (3) when disposing of the
assets, the credits and debts and other rights and obligations of
the
Object Company, Party B shall procure advance approval from Party
A.
|
| Article25 |
Party
B shall be responsible for performing the examination, approval and
filing
procedures related to the equity interest
transfer.
|
| Article26 |
Party
B shall timely complete the checking affairs specified in Chapter
Five of
the Contract.
|
| Article27 |
Party
B
shall be responsible for the electricity use issue under the construction
and operation of Carborundum Project. Party B shall make the Object
Company sign preferential electricity supply contracts with electricity
supply organization and the contracts shall be approved by Party
B.
|
| Article28 |
Party
B shall be responsible for performing the approval procedures including
the project application, environmental protection, land owenership,
resources utilization, safety manufacture, planning, water intake
permit,
water and soil conservation required for the construction and operation
of
the Carborundum Project, so that the legal requirements for the project
construction and operation can be
met.
|
12
| Article29 |
Party
B shall make sure that the Object Company is able to obtain preferential
and high quality raw materials for the construction and operation
of the
Carborundum Project.
|
| Article30 |
Party
B shall
send timely written notice to Party A when Party B is in knowledge
of any
situation which may lead to failure in fulfilling all or part of
the
Contract.
|
| Article31 |
Party
B is entitled to receive the equity interest transfer price as per
the
Contract.
|
Chapter
IX
Rights, Obligations and Guarantees of Party A
In
addition to Party A’s rights, obligations and guarantees specified by other
clauses of the Contract, Party A shall enjoy rights, bear obligations and
provide guarantees in accordance with the following provisions:
| Article 32 |
Party
A shall assist Party B to perform all approval procedures in relation
to
the equity interest transfer and promise to provide all necessary
cooperation.
|
| Article 33 |
Party
A shall assist Party B to perform all industrial and commercial alteration
registration procedures in relation to the equity interest transfer
and
promise to provide all necessary
cooperation.
|
| Article 34 |
Party
A shall pay the equity interest transfer price to Party B as per
the
Contract and shall increase the registration capital of the Object
Company
as per the Contract.
|
| Article 35 |
Party
A shall
give timely written notice to Party B when Party A is in knowledge
of any
situation which may lead to failure in fulfilling all or any part
of the
Contract.
|
13
Chapter
X Performance,
Wind-up and Termination
| Article36 |
The
parties shall perform their contractual obligations fully and completely
as per the provisions of the Contract.
|
| Article37 |
Party
B and Party A shall work well together, give mutual cooperation,
prepare
all necessary application documents and complete all procedures relating
to the equity interest transfer under the Contract, including but
not
limited to examination and approval, record filing, industrial and
commercial registration. The costs and expenses occurred therefrom
shall
be borne evenly among the parties.
|
| Article38 |
If
there are any undisclosed facts or circumstances relating to the
Object
Company before the Contract is executed, which have material and
adverse
impact on the legal and normal operation of the Object Company after
the
closing date, Party A is entitled to terminate the
Contract.
|
| Article39 |
If
Party A does not pay the equity transfer price or does not increase
the
capital according to this Contract, Party B has the right to terminate
this Contract.
|
| Article40 |
If
Party A terminates the Contract as per Article 38 and Article 39
of the
Contract, it shall give written termination notice to Party B and
Party B
shall bear the breach of contract liability as per the
Contract.
|
| Article41 |
If
the equity interest transfer fail to be approved by the examination
and
approval authority and such failure is not caused by Party A or Party
B,
the Contract shall be automatically terminated and no parties to
the
Contract shall bear breach of contract
liability.
|
14
Chapter
XI Representations
and Statements of Party B
As
the
substantial basis for Party A to execute the Contract, Party B represent and
state that:
| Article 42 |
Party
B has full civil right capability and capacity for civil conduct
to
execute and fulfil the Contract and Party B has procured due authorization
to execute and fulfill the Contract. Party B has been authorized
to
execute and perform this Contract.
|
| Article 43 |
The
registered capital of the Object Company has been fully paid as per
related Chinese laws.
|
| Article 44 |
Unless
Chinese laws provide otherwise, the equity interest to be transferred
by
Party B to Party A does not bear any encumbrance preventing the transfer
to Party A.
|
| Article 45 |
The
execution, delivery and fulfilment of the Contract by Party B, will
not
(1) violate any articles of association of the Object Company; (2)
cause
the Object Company, or Party B to violate any agreements, covenants,
commitments or other documents; (3) violate any laws, administrative
regulations, rules, normative documents, administrative replies or
any
judgments, awards, verdicts, orders or decrees, where the violation
will
have material adverse impact on the business, operation, assets or
financial condition of the Object Company or Party B; or (4) result
in the
creation of (or the obligation to create) any encumbrance or restriction
of any kind on any properties or equity interests of the Object Company.
|
| Article 46 |
Except
the disclosed information, there is no other circumstance affecting
the
legality and validity of the equity interest transfer and there is
no
circumstance affecting the legal interest of the Object Company.
The
copies of the materials provided by Party B or the Object Company
to Party
A or Party A appointed professional agencies are consistent with
the
original copies and the original copies are truly existent, legal
and
valid. There are no other credits, debts, restrictive rights, potential
disputes, defects or flaws of the assets (including design and building
defects or flaws) of the Object Company which are undisclosed to
Party A.
|
15
| Article 47 |
The
Object Company has full ownership of the assets under its name. The
assets
are free of any encumbrance, mortgage, pledge or
liens.
|
| Article 48 |
By
the date the Contract is executed, the Object Company does not have
any
pending litigation, arbitration, administrative penalty nor does
the
Object Company have any fact or issue which may lead to a
dispute.
|
| Article 49 |
The
Object Company is in compliance with requirements of all Chinese
laws in
respect of environment protection, health and safety and does not
have any
harmful act which will entitle a third party to file a claim against
the
Object Company, demanding removal of the harm or obstacle or compensation
for its loss.
|
| Article 50 |
The
Object Company has legally completed tax registration and has legally
and
sufficiently fulfilled its tax payment obligations before the closing
date. The Object Company does not have any pending tax claim and
is not
threatened by any auditing or investigation.
|
| Article 51 |
The
Object Company after the closing date does not have any outstanding
salaries, remuneration, housing accumulation fund, social insurance,
employment compensation, employment injury compensation, nor does
the
Object Company have any labor disputes or potential issue which may
lead
to labor disputes.
|
| Article 52 |
From
the date the Contract is executed until the closing date, Party B
will
operate and manage the Object Company in normal manner. The operation,
business and condition of the Object Company will not have any material
and adverse change compared with the condition before the Contract
is
executed.
|
16
Chapter
XII
Representations and Statements of Party A
As
the
substantial basis for Party B to execute the Contract, Party A represent and
state that:
| Article 53 |
Party
A
has full civil right capability and capacity for civil conduct to
execute
and fulfil the Contract and has procured due authorization to execute
and
fulfil the Contract.
|
| Article 54 |
After
the Contract comes into effect, the Contract is legally binding upon
Party
A and is enforceable against Party A under relevant Chinese laws
of
bankruptcy, liquidation, reorganization, moratorium
and other laws relating to the creditor’s rights and
remedies.
|
| Article 55 |
The
execution and fulfilment of the Contract by Party A will not (1)
cause
Party A to violate any agreement, covenant, commitment or other document;
(2) violate any laws, statutory laws, regulations, statutory rules
or any
judgments, injunctions, orders or decrees where the violation will
have
materially adverse impact on the business, operation, assets or financial
condition of Party A.
|
Chapter
XIII
Confidentiality
| Article 56 |
The
party which receives the disclosed information as per the Contract,
shall:
|
| (1) |
Keep
the disclosed information confidential within five years upon execution
of
the Contract;
|
| (2) |
Except
that the above materials and information are disclosed to the employees
or
consultants on need-to-know basis, any party to the Contract shall
not
disclose to any third party the above materials and
information.
|
17
| Article 57 |
the
Provisions of Article 56 are not applicable
to:
|
| (1) |
the
information the receiving party has already known or the receiving
party
can prove the materials and information may be known through other
legal
channels before the disclosing party discloses the information to
the
receiving party,.
|
| (2) |
the
materials and information obtained by the receiving party from any
third
Party who is not subject to any confidentiality obligations.
|
| (3) |
the
materials and information which is required to bedisclosed as per
provision of laws and regulations.
|
Chapter
XIV Liability for Breach of Contract
| Article 58 |
If
Party A or Party B fails to obtain internal authorization to execute
and
fulfill the Contract, or, the execution and fulfillment of the Contract
contradicts with or contravenes articles of association, government
authorization or approval, or due to some reason one party shall
take
blame for, the Contract is invalidated, becomes impossible to be
fulfilled
or fully fulfilled, such party shall be deemed to have breached the
Contract. The breaching party shall pay the abiding party 1% of the
Equity
Interest Transfer Price as penalty.
|
| Article 59 |
If
the significant issues related to Party A but not disclosed by Party
A
before this Contract is executed, fail the realization of this equity
interest transfer, or Party A does not perform the capital increase
obligation, then Party B is entitled to terminate this Contract.
Party A
shall return the equity interest of the Object Company transferred
according to this Contract and shall also compensate Party B for
the total
losses resulted from the execution and performance of this
Contract.
|
| Article 60 |
If
Party B, before this Contract is executed, has not disclosed the
facts
which may impact the legal existence of the Object Company and the
Carborundum Project, thus the legal existence of the Object Company
or the
Carborundum Project is seriously impacted after the Equity Interest
Transfer is completed, Party A is entitled to terminate this Contract
and
Party B shall immediately repay all payments received as per the
Contract.
Party B shall also compensate Party A for the total losses resulted
from
the execution and performance of this
Contract.
|
18
| Article 61 |
If
Party A does not perform any of its obligations under this Contract,
and
this non-performance has a significant adverse impact on the construction
of Carborundum Project, in addition, Party A does not eliminate the
adverse effect or fulfill the compensation obligation, Party B has
the
right to terminate this Contract. Then Party A shall compensate Party
B
for its losses resulting from the execution and performance of this
Contract.
|
| Article 62 |
If
Party B does not perform any of its obligations under this Contract,
and
this non-performance has a significant adverse impact on the Object
Company after closing date, in addition, Party B does not eliminate
the
adverse effect or fulfill the compensation obligation, Party A has
the
right to terminate this Contract. Then Party B shall repay
all payments received as per the Contract and shall also compensate
Party
A for the total losses resulted from the execution and performance
of this
Contract.
|
| Article 63 |
During
the period from the Contract execution date to the closing date,
if Party
B commits any act which ▇▇▇▇▇ the assets, rights and interests of
the
Object Company, it shall constitute a breach of the Contract. Party
B
shall be liable to make compensation to Party A or the Object Company
for
any damages arising from the breach of the Contract.
|
| Article 64 |
If
Party A does not make the payment of equity interest transfer price
according to the deadline as agreed, for each day delay, Party A
shall pay
0.5‰ of the delayed amount as late payment
fee.
|
| Article 65 |
If
either Party A or Party B violates the obligations under the Contract
or
the representations and statements are false, or the guarantee
responsibilities are not fulfilled, it shall constitute a breach
of
contract. If the penalty as agreed is not sufficient to cover the
financial losses suffered by the abiding party in executing and fulfilling
the Contract, the breaching party shall make up the losses suffered
by the
abiding party.
|
19
Chapter
XV Force
Majeure
| Article 66 |
In
case Force Majeure event occurs, the obligations of the affected
party and
any time period binding on such affected party shall be suspended
and
extended automatically during the period of the Force Majeure event.
In
such case, the affected party shall not bear any liability for breach
of
the Contract as provided in the
Contract.
|
| Article 67 |
The
Party alleging the occurrence of a Force Majeure event shall inform
the
other Party in writing within seven (7) days after the Force Majeure
event, and shall provide sufficient evidence issued by competent
authority
proving the occurrence and the continuation of the Force
Majeure event
occurs. The party alleging Force Majeure shall, to the best of its
ability, eliminate the adverse effect of the Force Majeure event
on the
fulfillment of the Contract.
|
Chapter
XVI Disputes
Settlement
| Article 68 |
If
the Parties have disputes arising from the Contract and the dispute
cannot
be resolved through friendly consultation, any Party may submit the
dispute to China International Economic and Trade Arbitration Commission
(hereinafter referred to as “CIETAC”)
for arbitration in Beijing pursuant to the effective CIETAC arbitration
rules at the time of arbitration.
|
20
| Article 69 |
The
arbitration award issued by CIETAC shall be final and binding on
each
party.
|
Chapter
XVII Applicable
Law
| Article 70 |
The
establishment, validity, interpretation and implementation of this
Contract shall be governed and bound by the laws and regulations
of the
PRC. In the event the laws of the PRC do not have provision on a
certain
issue relating to this Contract, a reference shall be made to the
general
international commercial practice.
|
Chapter
XIX Miscellaneous
| Article 71 |
Amendment
|
Any
amendment to the Contract is only effective upon the execution of written
document by both Parties. If the amendment is only effective upon approval
by
relevant administrative departments according to Chinese laws, it shall be
approved by such competent administrative departments.
| Article 72 |
Severability
|
The
invalidity of any article in this
Contract shall not affect the validity of other articles in this
Contract.
| Article 73 |
Language
|
The
Contract is written and executed in Chinese and English. If there is any
discrepancy between the Chinese and English version, Chinese version shall
prevail.
| Article 74 |
The
Contract has six copies in duplicate. Each party keeps two copies.
The
other two copies shall be submitted for approval.
|
| Article 75 |
The
Contract shall be effective upon seals of both
parties.
|
| Article 76 |
Notification
|
| 76.1 |
Any
notice sent by one party to the other party shall be via express
mail
service. All notices shall be deemed to have been served on the
fifth day
after the date (subject to the postal seal) when the notices
are sent to
the correspondence address specified in the Contract. If the
date of
actual receipt is earlier than the said date, the date of actual
receipt
shall be the date of
receipt.
|
| 76.2 |
All
notices and correspondences shall be sent to the following addresses
unless the other party gives written notice to update such
addresses.
|
21
Party
A’s
correspondence address:
Phoneæ
Faxæ
Addresseeæ
Party
B’s
correspondence address:
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇; post code
830004.
Phone:
▇▇▇▇▇▇▇▇▇▇▇
Addressee:
▇▇▇
▇▇▇▇▇▇▇
Execution
page follows
22
[No
text
on this page, for signatures only]
Party
A C3 Capital, Limited
Authorized
representative:
Date:
Party
B ▇▇▇ ▇▇▇▇▇▇▇
Authorized
representative:
Date:
23