合资合同-en.doc

Draft JOINT VENTURE CONTRACT for INVESTMENT IN AND OPERATION OF PARTY C between and TABLE OF CONTENTS Page CHAPTER 1DEFINITIONS .1 CHAPTER 2ESTABLISHMENT AND LEGAL FORM OF THE JOINT ENTURE.3 CHAPTER 3PARTIES TO THE CONTRACT .5 CHAPTER 4PURPOSE, SCOPE AND SCALE.6 CHAPTER 5TOTAL INVESTMENT, REGISTERED CAPITAL AND ITS TRANSFER.6 CHAPTER 6FINANCING OF THE JOINT VENTURE.11 CHAPTER 7RESPONSIBILITIES OF THE PARTIES. .11 CHAPTER 8: TRADEMARKS. .13 CHAPTER 9: BOARD OF DIRECTORS. .13 CHAPTER 10 OPERATION AND MANAGEMENT OF THE JOINT VENTURE . .21 CHAPTER 11 ANNUAL BUSINESS PLAN. .25 CHAPTER 12 LABOR MANAGEMENT. .26 CHAPTER 13 PROFIT DISTRIBUTION, ACCOUNTING AND AUDIT. .28 CHAPTER 14 TAXATION AND INSURANCE. .31 CHAPTER 15 CONFIDENTIALITY . .32 CHAPTER 16 NON-COMPETITION. .32 CHAPTER 17 TERM OF JOINT VENTURE, EARLY TERMINATION AND LIQUIDATION. .33 CHAPTER 18 BREACH OF CONTRACT . .36 CHAPTER 19 FORCE MAJEURE. .36 CHAPTER 20 SETTLEMENT OF DISPUTES. .37 CHAPTER 21 APPLICABLE LAW. .38 CHAPTER 22 REPRESENTATIONS AND WARRANTIES . .38 CHAPTER 23 MISCELLANEOUS. .39 APPENDIX 1ARTICLES OF ASSOCIATION OF THE JOINT VENTURE APPENDIX 2 REGISTERED TRADEMARKS Comment DX1: Page: 1 Tentative English name. Comment DX2: Page: 1 “Agreement” in the Chinese original, as is the case in many other places. THIS JOINT VENTURE CONTRACT ( “Contract”) is entered on , 2004, in between: (1), an enterprise legal person established and existing under the laws of the Peoples Republic of China with its legal address at (“Party A”); and (2), a legal person established and existing under the laws of with its legal address at (“Party B”); Party A and Party B may be collectively referred to as the “Parties” or the “Shareholders” and individually as a “Party” or a “Shareholder”. RECITAL In accordance with the laws and regulations of the Peoples Republic of China, the Equity Sale and Subscription Agreement (as defined below) dated , 2004 among Party A, Party B and (Party C”), a limited liability company established and existing under the laws of the Peoples Republic of China) and this Contract, and following friendly consultations, the Parties have agreed to reorganize Party C into a Sino-foreign equity joint venture jointly owned by the Shareholders (the “Joint Venture”) in which Party A shall have of the equity interests and Party B shall have of the equity interests. The Parties are desirous to enter into this Contract to set out the rights and obligations between them in respect of the reorganization of Party C into an equity joint venture company. The Parties have hereby agreed as follows: CHAPTER 1DEFINITIONS 1.1Unless otherwise provided herein, the following terms when used herein shall have the following meanings: “Affiliate”, in relation to a Party, means an entity that directly or indirectly controls, or is controlled by, or is under common control with, that Party. For the purpose of this definition, “control” means the ownership, directly or indirectly, of 50% or more of the voting shares, registered capital or other interests in such entity, or the possession, directly or indirectly, of the power to appoint a majority of the members of the management, management committee or board of directors or similar decision-making body of such entity, whether through the ownership of voting shares, by contract or otherwise. “Appendix” means any appendix of this Contract. “Articles of Association” means the articles of association of the Joint Venture, attached hereto as Appendix 1. “Party C” means , before its reorganization into the Joint Venture, a limited liability company established and existing under the laws of the Peoples Republic of China. “Board” means the board of directors of the Joint Venture. “Business Licence” means the amended enterprise legal person business licence issued to the Joint Venture by the Industry and Commerce Administration. “Approval” means the approval reply issued to the Joint Venture by the competent Authority of the government approving the change of Party C into a Sino-foreign equity joint venture enterprise. “China” means the Peoples Republic of China. For the purposes of this Contract only, “China” refers to the parts of China other than Hong Kong, Macao and Taiwan. “Establishment of the Joint Venture” means the change of Party C as a wholly state-owned limited liability company into a Sino-foreign equity joint venture enterprise in accordance with the relevant laws and regulations, the approval of the Authority, the Equity Sale and Subscription Agreement and this Contract. “Change Date” means the date on which Party C receives from the industry and commerce registration authority its enterprise legal person business licence that changes it into the Joint Venture. “Confidential Information” includes (a) all information of a confidential nature disclosed, directly or indirectly, by a Party (the “Disclosing Party”) to another Party (the “Receiving Party”) in written, oral or any other form, or by the Company to any Party (including its Affiliates) in such forms, before or after the date of this Contract, including any information concerning the organization, operation, technical processes, plans or ideas, products, know- how, intellectual properties, design rights, trade secrets, market opportunities or business affairs of the Disclosing Party or the Company; and (b) the negotiations and consultations between the Parties in connection with the transaction contemplated in the Equity Sale and Subscription Agreement and this Contract and the existence and details of such agreements. “Force Majeure” means all events which cannot be controlled or foreseen, or even if foreseeable, cannot be avoided by the Parties and which prevent the total or partial performance by any Party, including without limitation any act of God, sabotage, accident, industrial strike, war, unavailability of means of transport, government act and other similar unexpected events. “Joint Venture” means the Sino-foreign equity joint venture enterprise resulting from the change of Party C in accordance with the laws and regulations of China and this Contract, which has been established with the approval of the competent Authority of the government and to which the Industry and Commerce Administration has issued a business licence. “Joint Venture Equity” means the equity interests owned by Party A and the equity interests owned by Party B in the Joint Venture, as adjusted from time to time according to the change of the registered capital of the Joint Venture. “Senior Officers” means the General Manager, Deputy General Managers, Chief Financial Officer, Chief Accountant and other employees of the Company so designated by the Board, except otherwise provided herein. “Officers” means the Senior Officers and other employees of the Company so designated by the Board. “Authority” means all government departments of China having the authority to approve the transactions relating to the Establishment of the Joint Venture, including without limitation the foreign investment administration authority. “RMB” means, Renminbi, the legal currency of China. “Industry and Commerce Administration” means the State Administration for Industry and Commerce or its authorized branches. “Equity Sale and Subscription Agreement” means the agreement dated among Party A, Party B and Party C for the sale and purchase of and the subscription for the equity interests in Party C. “Working Day” means any week day from Monday to Friday, excluding any legal holiday specified by the governments of China and . 1.2In this Contract: 1.2.1a reference to “subsidiary” shall be interpreted as a reference to an entity that is controlled by another entity through the ownership of shares or equity interests or through other arrangements. The term “control” means the possession of the power to direct the affairs of such entity through the ownership of 50% or more of the voting shares or other equity interests in such entity or, although without such voting shares, through the voting rights and other means, or by contract or otherwise; 1.2.2a reference to “controlling company” shall be so interpreted that when an entity is a subsidiary of another entity, such another entity shall be deemed its controlling company; 1.2.3a reference to “entity” shall include any individual, firm, company or any joint venture, consortium or partnership consisting in two or more of the preceding entities (whether with or without independent legal person status); 1.2.4a reference to any clause, paragraph and Appendix shall be a reference to the relevant clause, paragraph and Appendix of this Contract, unless otherwise provided; 1.2.5a reference to any time of the day shall mean Beijing time; and 1.2.6the headings herein shall not affect the construction of this Contract. CHAPTER 2ESTABLISHMENT AND LEGAL FORM OF THE JOINT VENTURE Establishment Comment DX3: Page: 4 This is another reference to the Joint Venture, but is not defined. 2.1The Joint Venture shall be established on the date on which the industry and commerce registration authority issues an enterprise legal person business licence in which it is changed into a Sino-foreign equity joint venture enterprise. 2.2The Parties shall be jointly responsible for taking all actions necessary for the Joint Venture. 2.3After signing this Contract, the Parties shall promptly submit this Contract, the Articles of Association, the Equity Sale and Subscription Agreement and any other required document to the Authority for examination and approval. The Parties shall inform each other of the status of the examination and approval within a reasonable time and, unless otherwise restricted by the applicable laws and regulations of China, promptly fax to the other Party any communication received from the Authority (including the approval reply and approval certificate). 2.4Within one month of obtaining the approval of such Authority, the Parties shall as soon as possible take action to cause the Joint Venture to complete the registration of the Joint Venture in accordance with the applicable joint venture laws and regulations and other relevant laws and regulations of China. The Parties shall keep each other reasonably informed of the progress and the relevant evidence (if any). 2.5Unless otherwise agreed by the Parties, if a payment is required to be made to a third party in the performance of any obligation under Clauses 7.1 and 7.2, the Party required to make the payment shall first make such payment on behalf of the Company and then receive reimbursement from the funds of the Joint Venture after the Change Date, provided however that the Party required to make any payment is able to provide a receipt for such payment and that such payment is of a reasonable amount and has been approved by the Company or the other Party (such approval not to be unreasonably withheld). Name, Address and Branch of the Joint Venture 2.6The Chinese name of the Joint Venture shall be: in Chinese, and _ in English. 2.7The address of the Joint Venture shall be: , China. 2.8Subject to the consent of the Board and the approval of the Authority, the Joint Venture may establish branches in China in accordance with the needs of its business. Legal Form The form of the Joint Venture shall be a limited liability company. Unless otherwise provided herein or required by a resolution of the Board, a Party shall not be required to provide further funds to the Joint Venture or to a third party on behalf of the Joint Venture in the form of capital contribution, loan, advance or guarantee or in other forms once it has paid its capital contribution to the registered capital of the Joint Venture. The Parties shall be liable for the losses and debts of the Joint Venture only to the extent of their respective capital contributions. The creditors of the Joint Venture shall have recourse only to the assets of the Joint Venture and, unless any Party has provided a guarantee to the creditors in respect of the debts of the Joint Venture, shall not require any Party to assume additional liability for the debts of the Joint Venture. The Parties shall share the profits and losses of the Joint Venture in accordance with their respective paid capital contributions to the Joint Venture. 2.9The Joint Venture shall be an independent legal person as provided under the laws and regulations of China. The activities of the Joint Venture shall be governed and protected by the relevant laws and regulations of China. The business of the Joint Venture shall be controlled by the Board at all times. Unless expressly delegated or authorized by the Board, neither Party shall engage in any transaction or carry on any other activities on behalf of the Joint Venture. 2.10The Joint Venture shall comply with all applicable laws at all times. 2.11During the period between the date of this Contract and the Change Date, Party A shall cause Party C and its Affiliates to conduct their business as it was generally, duly and customarily conducted before the conclusion of this Contract. CHAPTER 3PARTIES TO THE CONTRACT 3.1The Parties to this Contract shall be 3.1.1, established in accordance with the laws and regulations of China, with its registered address at . The legal representative of Party A: Name: Position: Nationality: 3.1.2 The legal representative of Party B: Name: Position: Nationality: Change of Representative 3.2Each Party shall have the right to change its legal representative or authorized representative (as the case may be). In the event of such change, the other Party shall be promptly notified of the name, position and nationality of the new representative. CHAPTER 4PURPOSE, SCOPE AND SCALE 4.1Purpose of the Joint Venture To diversify the investments of the Company, and ultimately privatize the capital and internationalize the business of the Company; to strengthen the ability of the Company to compete in the international market; to enlarge its share and boost its strength in the construction machinery industry; to establish “” as an internationally-known brand name; to establish a permanent construction machinery base in ; and to provide an above-average return to the Shareholders. 4.2Business Scope of the Joint Venture 4.3Business Scale of of the Joint Venture CHAPTER 5TOTAL INVESTMENT AND REGISTERED CAPITAL AND ITS TRANSFER Total Investment 5.1The total investment of the Joint Venture shall be RMB million (“Total Investment”). Registered Capital and Financing 5.2The registered capital of the Joint Venture shall be RMB million (“Registered Capital”). Contribution to the Registered Capital upon the Establishment of the Joint Venture 5.3The Parties shall contribute to the Registered Capital in the following manner: 5.3.1The contribution to the Registered Capital of the Joint Venture by Party A shall be RMB , representing of the Reg