o | REGISTRATION STATEMENT PURSUANT TO SECTION 12(B) OR 12(G) OF THE SECURITIES EXCHANGE ACT OF 1934 |
þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Date of event requiring this shell company report |
John Layburn, Acting Chief Financial Officer and Chief
Strategy and Compliance Officer Phone: +86 (10) 8438 1031 Email: john.layburn@agriacorp.com |
David Pasquale, Senior Vice President
Phone: +1 914 337 1117 Email: david.pasquale@agriacorp.com |
|
21/F Tower B, PingAn International Finance Center,
1-3 Xinyuan South Road, Chaoyang District Beijing 100027, Peoples Republic of China |
Two Park Place
Bronxville, New York 10708 United States of America |
Title of Each class | Name of Each Exchange on Which Registered | |
American Depositary Shares, each representing
two ordinary shares, par value $0.0000001 per share |
New York Stock Exchange |
Large accelerated filer o | Accelerated filer o | Non-accelerated filer þ |
US GAAP
þ
|
International Financial Reporting Standards as issued
by the International Accounting Standards Board o |
Other o |
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Exhibit 4.40 | ||||||||
Exhibit 4.41 | ||||||||
Exhibit 4.42 | ||||||||
Exhibit 4.43 | ||||||||
Exhibit 4.44 | ||||||||
Exhibit 4.45 | ||||||||
Exhibit 4.46 | ||||||||
Exhibit 4.47 | ||||||||
Exhibit 4.48 | ||||||||
Exhibit 4.54 | ||||||||
Exhibit 4.55 | ||||||||
Exhibit 4.56 | ||||||||
Exhibit 4.57 | ||||||||
Exhibit 4.58 | ||||||||
Exhibit 8.1 | ||||||||
Exhibit 12.1 | ||||||||
Exhibit 12.2 | ||||||||
Exhibit 13.1 | ||||||||
Exhibit 13.2 | ||||||||
Exhibit 15.1 | ||||||||
Exhibit 15.2 | ||||||||
Exhibit 15.3 | ||||||||
Exhibit 15.4 |
| we, us, our company, the Company, our and Agria refer to Agria Corporation, a Cayman Islands company, and its predecessor entities, subsidiaries and, unless the context indicates otherwise, Guanli, our consolidated affiliated entity, and its subsidiaries and associates (including its 49% owned associate Wuwei Ganxin Seeds Company Limited, or Ganxin); |
| P3A refers to Taiyuan Primalights III Agriculture Development Co., Ltd., a limited liability company established in China, which was one of our consolidated affiliated entities until it was disposed of in July 2010; |
| Guanli refers to our consolidated affiliated entity, Shenzhen Guanli Agricultural Technology Co., Ltd., which is a limited liability company established in China; |
| PGW refers to PGG Wrightson Group, in which we hold 50.01% equity interest; |
| China or PRC refers to the Peoples Republic of China, excluding, for purposes of this annual report, Taiwan, Hong Kong and Macau; |
| shares or ordinary shares refers to our ordinary shares, and preferred shares refers to our series A redeemable convertible preferred shares, all of which were converted into our ordinary shares upon the completion of our initial public offering on November 13, 2007; |
| ADSs refers to our American depositary shares, each of which represents two ordinary shares; and |
| all references to RMB or Renminbi are to the legal currency of China; all references to $, US$, dollars and US dollars are to the legal currency of the United States. |
| our future business development, results of operations and financial condition; | ||
| changes in our revenues, cost and expense items; |
| our anticipated development strategies, which may include potential acquisitions and divestitures, expanding into new sectors within the agricultural industry, expanding sales into new regions, and expanding our product offerings; |
| our strategy to expand our research and development capability; |
| the growth in demand in China for corn and vegetable seeds; |
1
| our ability to attract customers and end users and enhance our brand recognition; |
| future changes in government regulations affecting our business; |
| trends and competition in the agricultural industry, particularly in China, New Zealand, Australia and South America; and |
| our ability to retain and motivate existing management and other key personnel and to recruit and integrate additional qualified personnel into our operations. |
ITEM 1. | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS |
ITEM 2. | OFFER STATISTICS AND EXPECTED TIMETABLE |
ITEM 3. | KEY INFORMATION |
2
For the Year Ended December 31, | ||||||||||||||||
2008 | 2009 | 2010 | ||||||||||||||
RMB | RMB | RMB | $ | |||||||||||||
(In thousands, except share, per share and per ADS data) | ||||||||||||||||
Consolidated Statements of Operations Data:
|
||||||||||||||||
Revenue
|
3,000 | 3,013 | 29,022 | 4,397 | ||||||||||||
Cost of revenue
|
(2,651 | ) | (5,285 | ) | (17,345 | ) | (2,628 | ) | ||||||||
|
||||||||||||||||
Gross profit
|
349 | (2,272 | ) | 11,677 | 1,769 | |||||||||||
|
||||||||||||||||
|
||||||||||||||||
Operating expenses:
|
||||||||||||||||
Selling expenses
|
| (166 | ) | (875 | ) | (132 | ) | |||||||||
General and administrative expenses
|
(864,771 | ) | (89,453 | ) | (97,796 | ) | (14,818 | ) | ||||||||
Research and development expenses
|
(1,932 | ) | (1,156 | ) | (114 | ) | (17 | ) | ||||||||
|
||||||||||||||||
Total operating expenses
|
(866,703 | ) | (90,775 | ) | (98,785 | ) | (14,967 | ) | ||||||||
|
||||||||||||||||
Operating loss
|
(866,354 | ) | (93,047 | ) | (87,108 | ) | (13,198 | ) | ||||||||
|
||||||||||||||||
Other income (expenses):
|
||||||||||||||||
Interest income
|
33,744 | 8,489 | 22,448 | 3,401 | ||||||||||||
Interest expense
|
(26 | ) | (40 | ) | (2,266 | ) | (343 | ) | ||||||||
Exchange loss
|
(11,812 | ) | (16,602 | ) | (2,843 | ) | (431 | ) | ||||||||
Unrealized (loss) gain in investment
|
| (548 | ) | 1,946 | 295 | |||||||||||
Other expense
|
(2,119 | ) | (33 | ) | (1,341 | ) | (203 | ) | ||||||||
Other income
|
90 | 2,799 | 20,634 | 3,126 | ||||||||||||
Loss from equity investments
|
| | (2,223 | ) | (337 | ) | ||||||||||
|
||||||||||||||||
Loss before income tax
|
(846,477 | ) | (98,982 | ) | (50,753 | ) | (7,690 | ) | ||||||||
Income tax
|
(25,577 | ) | (10,915 | ) | (7,104 | ) | (1,076 | ) | ||||||||
|
||||||||||||||||
Loss from continuing operations
|
(872,054 | ) | (109,897 | ) | (57,857 | ) | (8,766 | ) | ||||||||
Income (loss) from discontinued operations
|
121,053 | (25,378 | ) | (1,314 | ) | (199 | ) | |||||||||
|
||||||||||||||||
Net loss
|
(751,001 | ) | (135,275 | ) | (59,171 | ) | (8,965 | ) | ||||||||
|
||||||||||||||||
|
||||||||||||||||
Loss per ordinary share:
|
||||||||||||||||
Loss per share from continuing operations basic
and diluted
|
(6.91 | ) | (0.88 | ) | (0.49 | ) | (0.07 | ) | ||||||||
|
||||||||||||||||
Income (loss) per share from discontinued operations
basic and diluted
|
0.96 | (0.20 | ) | (0.01 | ) | * | ||||||||||
|
||||||||||||||||
Net loss per share basic and diluted
|
(5.95 | ) | (1.08 | ) | (0.50 | ) | (0.08 | ) | ||||||||
|
||||||||||||||||
Weighted average number of ordinary shares outstanding:
|
||||||||||||||||
Basic
|
126,262,529 | 125,271,946 | 118,377,357 | 118,377,357 | ||||||||||||
|
||||||||||||||||
Diluted
|
126,262,529 | 125,271,946 | 118,377,357 | 118,377,357 | ||||||||||||
|
* | Less than 0.01 per share |
As of December 31, | ||||||||||||||||
2008 | 2009 | 2010 | ||||||||||||||
RMB | RMB | RMB | $ | |||||||||||||
(In thousands) | ||||||||||||||||
Consolidated Balance Sheets Data:
|
||||||||||||||||
Cash and cash equivalents
|
1,176,767 | 737,825 | 358,228 | 54,277 | ||||||||||||
Accounts receivable
|
162,820 | 109,265 | 284 | 43 | ||||||||||||
Total assets
|
2,077,762 | 2,006,153 | 1,617,750 | 245,114 | ||||||||||||
Total current liabilities
|
53,056 | 94,129 | 153,992 | 23,332 | ||||||||||||
Ordinary shares
|
| | | | ||||||||||||
Additional paid-in capital
|
2,368,520 | 2,381,377 | 2,285,611 | 346,305 | ||||||||||||
Total shareholders equity
|
1,835,560 | 1,712,486 | 1,463,758 | 221,782 |
3
Noon Buying Rate | ||||||||||||||||
Period | Period End | Average (1) | Low | High | ||||||||||||
(RMB per $1.00) | ||||||||||||||||
2006
|
7.8041 | 7.9579 | 8.0702 | 7.8041 | ||||||||||||
2007
|
7.2946 | 7.5806 | 7.8127 | 7.2946 | ||||||||||||
2008
|
6.8225 | 6.9193 | 7.2946 | 6.7800 | ||||||||||||
2009
|
6.8259 | 6.8295 | 6.8470 | 6.8176 | ||||||||||||
2010
|
6.6000 | 6.7715 | 6.8330 | 6.6306 | ||||||||||||
November
|
6.6670 | 6.6538 | 6.6892 | 6.6791 | ||||||||||||
December
|
6.6000 | 6.6497 | 6.6745 | 6.6000 | ||||||||||||
2011
|
||||||||||||||||
January
|
6.6017 | 6.5843 | 6.6017 | 6.5809 | ||||||||||||
February
|
6.5713 | 6.5761 | 6.5965 | 6.5520 | ||||||||||||
March
|
6.5483 | 6.5645 | 6.5743 | 6.5483 | ||||||||||||
April
|
6.4900 | 6.5267 | 6.5477 | 6.4900 | ||||||||||||
May
|
6.4786 | 6.4957 | 6.5073 | 6.4786 | ||||||||||||
June (through June 17)
|
6.4700 | 6.4785 | 6.4830 | 6.4700 |
(1) | Annual averages are calculated from month-end rates. Monthly averages are calculated using the average of the daily rates during the relevant period. |
4
5
| maintain our competitive position in China and compete in each of our business segments with Chinese and international companies, many of which have longer operating histories and greater financial resources than we do; |
| offer commercially successful seed products to attract and retain direct customers and ultimate users; |
| retain access to the farmland we currently use and obtain access to additional farmland for expansion; |
| continue our existing arrangements with village collectives that grow our corn seed products and enter into new arrangements with additional village collectives; |
| maintain effective control of our costs and expenses; and |
| retain and motivate our management and skilled technical staff and recruit and integrate additional qualified personnel into our operations. |
6
7
8
9
10
11
12
13
14
| revoking Guanlis business and operating licenses; |
| confiscating relevant income and imposing fines and other penalties; |
| prohibiting or restricting Guanlis operations in China; |
| requiring us or Guanli to restructure Guanlis ownership structure or operations; |
| restricting or prohibiting our use of the proceeds from our initial public offering to finance our businesses and operations in China; or |
| imposing conditions or requirements with which we or our subsidiaries or Guanli may not be able to comply. |
15
16
17
18
19
| announcement of securities law class action lawsuits against us and our directors and officers; |
| delays in our periodic earnings announcements; |
| announcements of technological or competitive developments; |
| regulatory developments in our target markets affecting us, our customers or our competitors; |
| actual or anticipated fluctuations in our quarterly operating results; |
| changes in financial estimates by securities research analysts; |
20
| changes in the economic performance or market valuations of our seeds; |
| additions to or departures of our executive officers and key personnel; |
| fluctuations in the exchange rates between the US dollar and RMB; and |
| sales or anticipated sales of additional ADSs. |
21
22
| Our board of directors has the authority to establish from time to time one or more series of shares, including preferred shares without action by our shareholders and to determine, with respect to any series of preferred shares, the terms and rights of that series, including the designation of the series; number of shares of the series; dividend rights, dividend rates, conversion rights, voting rights; and rights and terms of redemption and liquidation preferences. |
| Our board of directors may issue a series of preferred shares without action by our shareholders to the extent of available authorized but unissued shares. Accordingly, the issuance of preferred shares may adversely affect the rights of the holders of the ordinary shares. Issuance of preference shares may dilute the voting power of holders of ordinary shares. |
| Subject to applicable regulatory requirements, our board of directors may issue additional ordinary shares or rights to acquire ordinary shares without action by our shareholders to the extent of available authorized but unissued shares. |
ITEM 4. | INFORMATION ON THE COMPANY |
23
24
25
26
27
% | ||||
Agria Group
|
80.81 | % | ||
New Hope International
|
11.95 | % | ||
Ngai Tahu
|
7.24 | % |
28
| for the period from January 15, 2010 to December 31, 2011, 8.0% per annum on the principal amount of the notes; |
| for the period from January 1, 2012 to December 31, 2013, the two-year swap on December 31, 2011 plus a margin of 5.5%; |
| for subsequent two-year periods commencing on January 1, 2014, January 1, 2016 and so on, the two-year swap at the start of the relevant two-year period plus a margin of 6.5%. |
29
| Growing a focused seed business in China. We believe that the PRC government and the agricultural industry participants share the same goal of improving agricultural productivity, which is evidenced by strong foreign and domestic investment flowing into the agricultural industry in China. We consider that focusing on the seed sector will best position us to achieve sustainable growth in the future. |
| Developing strong expertise in operational management. The agricultural sector in China is highly fragmented with many small companies whose growth potential is hindered by a lack of experienced operational management. Our investment in and strategic partnership with PGW, which owns the largest seed company in the southern hemisphere gives us an access to a management team experienced in running modern international seed businesses. In June 2010, we also recruited Mr. Chuanli Zhou as the head of our seeds division. Mr. Zhou has over 20 years of experience in the seed industry in China and was previously the general manager of Shandong Denghai-PIONEER Seed Company, a joint venture between Pioneer Hi-Bred International Inc., a leading international agricultural company, and Shandong Denghai Seeds Co., Ltd. |
| Acquiring proprietary technologies. The seed industry is a technology-centered business and companies with sufficient quantity and quality of proprietary technologies have a significant competitive edge. We will continue to leverage our recent investment in and partnership with CNAAS to develop proprietary technologies. We are also at various stages of discussions regarding potential investments in seed companies with proprietary seed producers. |
30
31
32
33
34
35
36
37
38
| exercise effective control over Guanli, Agria Agriculture and Zhongyuan; |
| receive substantially all of the earnings and other economic benefits from Guanli, Agria Agriculture and Zhongyuan to the extent permissible under PRC law in consideration for the services provided by Agria Brother; and |
| have an exclusive option to purchase all or part of the equity interests in P3A, Guanli, Agria Agriculture and Zhongyuan in each case when and to the extent permitted by PRC law. |
ITEM 4A. | UNRESOLVED STAFF COMMENTS |
ITEM 5. | OPERATING AND FINANCIAL REVIEW AND PROSPECTS |
39
For the Years Ended December 31, | ||||||||||||||||||||||||||||
2008 | 2009 | 2010 | ||||||||||||||||||||||||||
RMB |
% of
Revenues |
RMB |
% of
Revenues |
RMB | $ |
% of
Revenues |
||||||||||||||||||||||
(In thousands, except percentages) | ||||||||||||||||||||||||||||
Revenue
|
3,000 | 100 | % | 3,013 | 100 | % | 29,022 | 4,397 | 100 | % | ||||||||||||||||||
Cost of revenue
|
(2,651 | ) | (88.4 | )% | (5,285 | ) | (175.4 | )% | (17,345 | ) | (2,628 | ) | (59.8 | )% | ||||||||||||||
|
||||||||||||||||||||||||||||
Gross profit
|
349 | 11.6 | % | (2,272 | ) | (75.4 | )% | 11,677 | 1,769 | 40.2 | % | |||||||||||||||||
|
||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||||||
Selling expenses
|
| 0.0 | % | (166 | ) | (5.5 | )% | (875 | ) | (132 | ) | (3.0 | )% | |||||||||||||||
General and administrative expenses
|
(864,771 | ) | (28,825.7 | )% | (89,453 | ) | (2,968.9 | )% | (97,796 | ) | (14,818 | ) | (337.0 | )% | ||||||||||||||
Research and development expenses
|
(1,932 | ) | (64.4 | )% | (1,156 | ) | (38.4 | )% | (114 | ) | (17 | ) | (0.4 | )% | ||||||||||||||
|
||||||||||||||||||||||||||||
Total operating expenses
|
(866,703 | ) | (28,890.1 | )% | (90,775 | ) | (3,012.8 | )% | (98,785 | ) | (14,967 | ) | (340.4 | )% | ||||||||||||||
|
||||||||||||||||||||||||||||
Operating loss
|
(866,354 | ) | (28,878.5 | )% | (93,047 | ) | (3,088.2 | )% | (87,108 | ) | (13,198 | ) | (300.1 | )% | ||||||||||||||
|
||||||||||||||||||||||||||||
Other income (expenses):
|
||||||||||||||||||||||||||||
Interest income
|
33,744 | 1,124.8 | % | 8,489 | 281.7 | % | 22,448 | 3,401 | 77.3 | % | ||||||||||||||||||
Interest expense
|
(26 | ) | (0.9 | )% | (40 | ) | (1.3 | )% | (2,266 | ) | (343 | ) | (7.8 | )% | ||||||||||||||
Exchange loss
|
(11,812 | ) | (393.7 | )% | (16,602 | ) | (551.0 | )% | (2,843 | ) | (431 | ) | (9.8 | %) | ||||||||||||||
Unrealized (loss) gain in investment
|
| | (548 | ) | (18.2 | )% | 1,946 | 295 | 6.7 | % | ||||||||||||||||||
Other expense
|
(2,119 | ) | (70.6 | )% | (33 | ) | (1.1 | )% | (1,341 | ) | (203 | ) | (4.6 | )% | ||||||||||||||
Other income
|
90 | 3.0 | % | 2,799 | 92.9 | % | 20,634 | 3,126 | 71.1 | % | ||||||||||||||||||
Loss from equity investments
|
| | | | (2,223 | ) | (337 | ) | (7.7 | )% | ||||||||||||||||||
|
||||||||||||||||||||||||||||
Loss before income tax
|
(846,477 | ) | (28,215.9 | )% | (98,982 | ) | (3,285.2 | )% | (50,753 | ) | (7,690 | ) | (174.9 | )% | ||||||||||||||
Income tax
|
(25,577 | ) | (852.5 | )% | (10,915 | ) | (362.3 | )% | (7,104 | ) | (1,076 | ) | (24.5 | )% | ||||||||||||||
|
||||||||||||||||||||||||||||
Loss from continuing operations
|
(872,054 | ) | (29,068.4 | )% | (109,897 | ) | (3,647.5 | )% | (57,857 | ) | (8,766 | ) | (199.4 | )% | ||||||||||||||
Income (loss) from discontinued
operation
|
121,053 | 4,035.1 | % | (25,378 | ) | (842.3 | )% | (1,314 | ) | (199 | ) | (4.5 | )% | |||||||||||||||
|
||||||||||||||||||||||||||||
Net loss
|
(751,001 | ) | (25,033.3 | )% | (135,275 | ) | (4,489.8 | )% | (59,171 | ) | (8,965 | ) | (203.9 | )% | ||||||||||||||
|
40
For the Year Ended December 31, | ||||||||||||||||||||||||||||||||||||||||
2008 | 2009 | 2010 | ||||||||||||||||||||||||||||||||||||||
% of | % of | % of | ||||||||||||||||||||||||||||||||||||||
Sales | Total | Sales | Total | Sales | Total | |||||||||||||||||||||||||||||||||||
Volume | Revenue | Revenues | Volume | Revenue | Revenues | Volume | Revenue | $ | Revenues | |||||||||||||||||||||||||||||||
(Revenue in RMB thousands and sales volume in kg) | ||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||
Edible corn seeds
|
| | | 385 | 13 | 0.4 | % | 811,056 | 28,715 | 4,351 | 99.0 | % | ||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||
Field corn seeds
|
| | | | | | 2,464 | 8 | 1 | 0.0 | % | |||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||
Vegetable seeds
|
| | | | | | 481 | 299 | 45 | 1.0 | % | |||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||
Royalty income
|
| 3,000 | 100.0 | % | | 3,000 | 99.6 | % | | | | | ||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||
Total
|
| 3,000 | 100.0 | % | 385 | 3,013 | 100.0 | % | 814,001 | 29,022 | 4,397 | 100.0 | % |
| In September 2009, we acquired Nong Ke Yu, an edible corn seeds business engaged in research and development, production, distribution and sales of seeds for edible corn for human consumption. Due to the seasonal nature of this business and the timing of the acquisition, revenue derived from Nong Ke Yu in 2009 was very low. However, in 2010, we benefited fully from Nong Ke Yus business and operations. |
| In January 2010, we acquired BeOK, a company engaged in research, production and marketing of vegetable seeds. |
| In September 2010, we invested in Ganxin and entered into an exclusive sales agency agreement with them. Under the terms of the exclusive sales agency agreement, we have the exclusive right to sell the entire production volume of all current and future varieties of field corn seeds owned or developed by Ganxin. Due to the seasonal nature of this business and the timing of the acquisition, no material revenue was derived from field corn seeds in 2010. |
41
2008 | 2009 | 2010 | ||||||||||||||||||||||||||||||||||||||||||
Cost of | Gross | Gross | Cost of | Gross | Gross | Cost of | Cost of | Gross | Gross | Gross | ||||||||||||||||||||||||||||||||||
Revenue | Profit | Profit | Revenue | Profit | Profit | Revenue | Revenue | Profit | Profit | Profit | ||||||||||||||||||||||||||||||||||
RMB000 | RMB000 | % | RMB000 | RMB000 | % | RMB000 | USD000 | RMB000 | USD000 | % | ||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||
Edible Corn Seeds
|
| | | 8 | 5 | 38.5 | % | 17,104 | 2,592 | 11,611 | 1,759 | 40.4 | % | |||||||||||||||||||||||||||||||
Field Corn Seeds
|
| | | | | | 8 | 1 | 0 | 0 | 4.3 | % | ||||||||||||||||||||||||||||||||
Vegetable Seeds
|
| | | | | | 233 | 35 | 66 | 10 | 22.1 | % | ||||||||||||||||||||||||||||||||
Other Cost of Revenue
|
2,651 | 349 | 11.6 | % | 5,277 | (2,277 | ) | (75.9 | )% | | | | | | ||||||||||||||||||||||||||||||
Total
|
2,651 | 349 | 11.6 | % | 5,285 | (2,272 | ) | (75.4 | )% | 17,345 | 2,628 | 11,677 | 1,769 | 40.2 | % |
42
43
44
| an RMB20.3 million ($3.1 million) net profit from discontinued operations for the period through the date of disposal; |
| an RMB212.8 million ($32.2 million) loss on disposal of discontinued operations; and |
| an RMB191.2 million ($29.0 million) reversal of deferred tax liabilities released due to the divestiture of our discontinued operations. |
45
46
Buildings and improvements
|
5-30 years | |||
Plant and machinery
|
5-10 years | |||
Furniture and office equipment
|
5 years | |||
Motor vehicles
|
5-6 years |
47
48
49
For the Year Ended December 31, | ||||||||||||||||
2008 | 2009 | 2010 | ||||||||||||||
RMB | RMB | RMB | $ | |||||||||||||
(In thousands) | ||||||||||||||||
Net cash provided by/(used in) operating activities
|
209,096 | (6,281 | ) | (9,210 | ) | (1,398 | ) | |||||||||
Net cash used in investing activities
|
(337,636 | ) | (429,981 | ) | (277,153 | ) | (41,991 | ) | ||||||||
Net cash (used in)/provided by financing activities
|
(13,612 | ) | (2,026 | ) | (76,396 | ) | (11,575 | ) | ||||||||
Effect of exchange rate changes on cash
|
(68,234 | ) | (654 | ) | (16,838 | ) | (2,551 | ) | ||||||||
Net decrease in cash and cash equivalents
|
(210,386 | ) | (438,942 | ) | (379,597 | ) | (57,515 | ) | ||||||||
Cash and cash equivalents at the beginning of the year
|
1,387,153 | 1,176,767 | 737,825 | 111,792 | ||||||||||||
Cash and cash equivalents at the end of the year
|
1,176,767 | 737,825 | 358,228 | 54,277 |
50
As of December 31, | ||||||||||||
2008 Pro forma | 2009 Pro forma | 2010 | ||||||||||
(Unaudited) | (Unaudited) | Actual | ||||||||||
(RMB000) | (RMB000) | (RMB000) | ||||||||||
|
||||||||||||
Assets:
|
||||||||||||
Current assets:
|
||||||||||||
Cash and cash equivalents
|
1,169,732 | 670,623 | 358,228 | |||||||||
Restricted cash
|
| | 136,000 | |||||||||
Accounts receivable
|
1,500 | 104 | 284 | |||||||||
Inventories
|
| 21,668 | 74,368 | |||||||||
Prepayments and other current assets
|
10,415 | 8,854 | 19,046 | |||||||||
Amounts due from related parties
|
| | 1,300 | |||||||||
Assets held for sale current
|
231,565 | 257,699 | | |||||||||
|
||||||||||||
Total current assets
|
1,413,212 | 958,948 | 589,226 | |||||||||
|
||||||||||||
|
51
As of December 31, | ||||||||||||
2008 Pro forma | 2009 Pro forma | 2010 | ||||||||||
(Unaudited) | (Unaudited) | Actual | ||||||||||
(RMB000) | (RMB000) | (RMB000) | ||||||||||
Non-current assets:
|
||||||||||||
Property, plant and equipment, net
|
24,741 | 26,145 | 6,245 | |||||||||
Investment at fair value
|
| 414,047 | 403,490 | |||||||||
Investment under equity method
|
| | 47,894 | |||||||||
Investments under cost method
|
| 7,000 | 165,444 | |||||||||
Intangible assets, net
|
191,650 | 373,913 | 353,026 | |||||||||
Goodwill
|
| 9,818 | 10,135 | |||||||||
Non-current prepayments
|
244,904 | 40,458 | 40,258 | |||||||||
Deferred tax assets
|
438 | 3,480 | 2,032 | |||||||||
Assets held for sale noncurrent
|
202,816 | 172,344 | | |||||||||
|
||||||||||||
Total non-current assets
|
664,549 | 1,047,205 | 1,028,524 | |||||||||
|
||||||||||||
Total assets
|
2,077,761 | 2,006,153 | 1,617,750 | |||||||||
|
||||||||||||
|
||||||||||||
Liabilities and shareholders equity
|
||||||||||||
Current liabilities:
|
||||||||||||
Short-term bank borrowings
|
| | 59,604 | |||||||||
Tax payable
|
2,488 | | 338 | |||||||||
Accounts payable
|
| 1,442 | 177 | |||||||||
Accrued expenses and other liabilities
|
7,532 | 45,167 | 51,030 | |||||||||
Amounts due to related parties
|
| | 42,843 | |||||||||
Deferred tax liability
|
| 63 | | |||||||||
Liabilities associated with assets held for sale current
|
43,037 | 47,457 | | |||||||||
|
||||||||||||
Total current liabilities
|
53,057 | 94,129 | 153,992 | |||||||||
|
||||||||||||
|
||||||||||||
Non-current liabilities:
|
||||||||||||
Liabilities associated with held for sale noncurrent
|
189,145 | 199,538 | | |||||||||
Total non-current liabilities
|
189,145 | 199,538 | | |||||||||
|
||||||||||||
Total liabilities
|
242,202 | 293,667 | 153,992 | |||||||||
|
||||||||||||
|
||||||||||||
Total shareholders equity
|
1,835,559 | 1,712,486 | 1,463,758 | |||||||||
|
||||||||||||
Total liabilities and shareholders equity
|
2,077,761 | 2,006,153 | 1,617,750 | |||||||||
|
52
53
Payment Due by December 31, | ||||||||||||||||||||||||
Total | 2011 | 2012 | 2013 | 2014 | Thereafter | |||||||||||||||||||
(in RMB thousands) | ||||||||||||||||||||||||
Short-term borrowings
(1)
|
||||||||||||||||||||||||
- principal
|
59,604 | 59,604 | ||||||||||||||||||||||
- interest
|
20 | 20 | ||||||||||||||||||||||
Building and premises lease obligations
(2)
|
11,038 | 2,898 | 2,371 | 561 | 347 | 4,861 | ||||||||||||||||||
Purchase obligations
(3)
|
80 | 80 | | | | | ||||||||||||||||||
Commitment for further investment in PGW
(4)
|
743,820 | 743,820 | | | | | ||||||||||||||||||
Investment into Zhongnong
(5)
|
28,000 | 28,000 | ||||||||||||||||||||||
Capital expenditure commitment
(6)
|
24 | 24 | ||||||||||||||||||||||
|
||||||||||||||||||||||||
Total
|
842,586 | 834,446 | 2,371 | 561 | 347 | 4,861 | ||||||||||||||||||
|
(1) | Includes short-term borrowings and future interest obligations. | |
(2) | Includes lease obligations for our office premises, buildings under non-cancelable leases and land used to test seed varieties. | |
(3) | Represents commitments for the purchase of seeds. | |
(4) | Represents commitments to make a partial offer to increase Agria Singapores stake in PGW to 50.01% at an offer price of NZ$0.60 per share and associated expenses for the subscription in a convertible redeemable note that was issued by PGW in January 2010. In December, 2010, we and New Hope Group entered into an agreement whereby both we and New Hope International would be jointly and severally liable for funding the acquisition. Prior to completion of the acquisition, this agreement were superseded by the agreements described in Item 4 Business Overview Structure of our investment in PGW. | |
(5) | Represents commitments to make remaining investment into Zhongnong. | |
(6) | Represents commitments for the purchase of equipment. |
| our future business development, results of operations and financial condition; |
| changes in our revenues, cost and expense items; |
54
| our anticipated development strategies, which may include potential acquisitions and divestitures, expanding into new sectors within the agricultural industry, expanding sales into new regions, and expanding our product offerings; |
| our strategy to expand our research and development capability; |
| the growth in demand in China for corn and vegetable seeds; |
| our ability to attract customers and end users and enhance our brand recognition; |
| future changes in government regulations affecting our business; |
| trends and competition in the agricultural industry, particularly in China, New Zealand, Australia and South America; and |
| our ability to retain and motivate existing management and other key personnel and to recruit and integrate additional qualified personnel into our operations. |
ITEM 6. | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES |
Directors and Executive Officers | Age | Position/Title | ||||
Guanglin Lai
|
47 | Chairman of the Board of Directors | ||||
Xie Tao
|
48 | Chief Executive Officer and Director | ||||
Gary Kim Ting Yeung
|
45 | Director | ||||
Kenneth J. DeWoskin
|
68 | Independent Director | ||||
Shangzhong Xu
|
61 | Independent Director | ||||
Jiuran Zhao
|
49 | Independent Director | ||||
Joo Hai Lee
|
55 | Independent Director | ||||
Sean Shao
|
54 | Independent Director | ||||
|
||||||
John Layburn
|
36 | Acting Chief Financial Officer and Chief Strategy and Compliance Officer | ||||
Weizhong Wang
|
48 | Chief Strategy Officer, Corn Seed | ||||
Kean Seng U
|
44 | Head of Corporate and Legal Affairs | ||||
David Pasquale
|
40 | Senior Vice President |
55
56
57
58
| selecting the independent auditors and pre-approving all auditing and non-auditing services permitted to be performed by the independent auditors; |
| reviewing with the independent auditors any audit problems or difficulties and managements response; |
| reviewing and approving all proposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act; |
59
| discussing the annual audited financial statements with management and the independent auditors; |
| reviewing major issues as to the adequacy of our internal controls and any special audit steps adopted in light of material control deficiencies; |
| annually reviewing and reassessing the adequacy of our audit committee charter; |
| meeting separately and periodically with management and the independent auditors; and |
| reporting regularly to the board of directors. |
| reviewing and recommending to the board total compensation packages for our senior executives; |
| approving and overseeing the total compensation packages for our chief executive officer; |
| reviewing and recommending director compensation to the board; and |
| periodically reviewing and approving any long-term incentive compensation or equity plans, programs or similar arrangements, annual bonuses, employee pension and welfare benefit plans. |
| selecting and recommending nominees for election or re-election to the board or appointments to fill any vacancy; |
| annually reviewing with the board the current composition of the board with regards to characteristics such as independence, age, skills, experience and availability of service to us; |
| periodically advising the board with regard to significant developments in the law and practice of corporate governance as well as our compliance with applicable laws and regulations, and making recommendations to the board on all matters of corporate governance and on any remedial action to be taken; and |
| monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance. |
60
Number of full- | Percentage of | Number of part- | Percentage of | |||||||||||||
time Employees | Total Employees | time Employees | Total Employees | |||||||||||||
China Seeds
|
62 | 45 | % | 28 | 20 | % | ||||||||||
Administration
|
48 | 35 | % | | | |||||||||||
|
||||||||||||||||
Total
|
110 | 80 | % | 28 | 20 | % |
| each of our directors and executive officers as of the date of this annual report; and |
| each person known to us to own beneficially more than 5% of our ordinary shares as of June 8, 2011. |
61
Ordinary Shares Beneficially Owned | ||||||||
Number (1) | % (2) | |||||||
Directors and Executive Officers:
|
||||||||
Guanglin Lai
(3)
|
48,788,667 | 43.9 | ||||||
Xie Tao
|
* | * | ||||||
Gary Kim Ting Yeung
|
* | * | ||||||
Kenneth J. DeWoskin
|
* | * | ||||||
Shangzhong Xu
|
* | * | ||||||
Jiuran Zhao
|
* | * | ||||||
Joo Hai Lee
|
| | ||||||
Sean Shao
|
* | * | ||||||
John Layburn
|
* | * | ||||||
Weizhong Wang
|
* | * | ||||||
Kean Seng U
|
* | * | ||||||
David Pasquale
|
* | * | ||||||
All directors and executive officers as a group
(4)
|
52,852,533 | 45.9 | ||||||
Principal Shareholders:
|
||||||||
Morgan Finanz Capital Limited
(5)
|
31,076,750 | 28.1 | ||||||
Brothers Capital Limited
(6)
|
17,445,250 | 15.7 | ||||||
Heartland Advisors, Inc.
(7)
|
10,231,970 | 9.2 | ||||||
TPG Capital, L.P.
(8)
|
8,650,000 | 7.8 | ||||||
Zhixin Xue
(9)
|
7,549,640 | 6.8 | ||||||
Dubai Group Limited
(10)
|
6,600,000 | 6.0 |
* | Less than 1% or our total issued and outstanding shares | |
(1) | Beneficial ownership is determined in accordance with Rule 13d-3 of the General Rules and Regulations under the Exchange Act and includes voting or investment power with respect to the securities. | |
(2) | For each person and group included in this table, percentage ownership is calculated by dividing the number of shares beneficially owned by such person or group by the sum of 110,766,600, being the number of ordinary shares outstanding as of June 8, 2011, and the number of ordinary shares underlying share options held by such person or group that are exercisable within 60 days after the date of this annual report if any. | |
(3) | Includes (i) 17,445,250 ordinary shares owned by BCL, a British Virgin Islands company wholly owned by Mr. Lai, and (ii) 31,076,750 ordinary shares owned by Morgan Finanz Capital Limited, a British Virgin Islands company wholly owned by BCL. The business address of Mr. Lai is Room 21/F Tower B, PingAn International Finance Center, 1-3 Xinyuan South Road, Chaoyang District, Beijing 100027, Peoples Republic of China. | |
(4) | Certain directors and executive officers have been granted options pursuant to our 2007 Share Incentive Plan. See B. Compensation of Directors and Executive OfficersShare Incentives. | |
(5) | Morgan Finanz Capital Limited is a company incorporated in the British Virgin Islands. Morgan Finanz Capital Limited is wholly owned by BCL, which in turn is wholly owned by Mr. Guanglin Lai. Mr. Guanglin Lai is the sole director of Morgan Finanz Capital Limited. | |
(6) | Includes 17,445,250 ordinary shares held by BCL, a British Virgin Islands company wholly owned by Mr. Lai, The business address of BCL is 21/F Tower B, PingAn International Finance Center, 1-3 Xinyuan South Road, Chaoyang District, Beijing 100027, Peoples Republic of China. | |
(7) | In the form of ADSs, each representing two ordinary shares, based on Form 13-F filed with the SEC by Heartland Advisors, Inc. for the quarter ended March 31, 2011. The business address of Heartland Advisors, Inc. is 789 North Water Street. Suite 500, Milwaukee, WI 53202. | |
(8) | In the form of ADSs, each representing two ordinary shares, based on Form 13-F filed with the SEC by TPG Capital, L.P. for the quarter ended March 31, 2010. TPG Capital, L.P. is ultimately owned by Tarrant Capital Advisors, Inc., a Delaware company, whose shareholders are David Bonderman and James Coulter. The registered address for both of these companies is c/o Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. | |
(9) | Based on the Schedule D filed with the SEC on July 23, 2008. The business address of Mr. Xue is Floor 25, Golden Port Hotel, No. 35 North Bing Zhou Road, Tai Yuan City, Shanxi Province 030012, Peoples Republic of China. |
62
(10) | Based on the Schedule 13G/A filed with the SEC on February 17, 2009. Dubai Ventures Group Limited, a company incorporated in Cayman Islands, holds 3,300,000 ADS, representing 6,600,000 ordinary shares of the company. Dubai Ventures Group Limited is wholly owned by Dubai Ventures Group L.L.C., whose General Manager is Dubai Group Limited, which has the authority, among other things, to acquire, purchase, subscribe for, sell, assign and/or transfer any shares owned by Dubai Ventures Group L.L.C. The directors of Dubai Group Limited are Fadhel Abdulbaqi Abu Al Hassan Al Qaed Al Ali, Hashim Abdulla Ahmad Al Babal, Soud Ahmad Abdulrahman Baalawi and Mohammad Abdulla Ali Al Gergawi. The address for Dubai Group Limited is c/o Paget Brown Trust Company Ltd., West Wind Building, Harbour Drive, George Town, Grand Cayman, British West Indies. |
ITEM 7. | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS |
63
64
65
66
ITEM 8. | FINANCIAL INFORMATION |
67
68
ITEM 9.
THE OFFER AND LISTING
Sales Price ($)
High
Low
17.00
7.00
11.75
1.21
4.53
0.75
3.31
1.20
1.85
0.75
3.77
1.05
2.62
1.69
4.53
1.90
3.31
1.77
1.56
1.18
1.83
1.11
2.07
1.33
1.97
1.41
2.12
1.71
1.89
1.53
2.10
1.26
1.57
1.18
1.38
1.20
1.32
0.94
Table of Contents
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
ITEM 10.
ADDITIONAL INFORMATION
Table of Contents
banks and other financial institutions;
insurance companies;
regulated investment companies;
real estate investment trusts;
broker-dealers;
traders that elect to use a mark-to-market method of
accounting;
U.S. expatriates;
tax-exempt entities;
persons liable for alternative minimum tax;
persons holding an ADS or ordinary share as part of a straddle, hedging, conversion or
integrated transaction;
Table of Contents
persons that actually or constructively own 10% or more of
the total combined voting power of all classes of our voting stock;
partnerships or other pass-through entities, or persons holding ADSs or ordinary shares through such entities; or
persons who acquired ADSs or ordinary shares pursuant to the exercise of any employee
share option or otherwise as compensation.
an individual who is a citizen or resident of the United States;
a corporation (or other entity treated as a corporation for U.S. federal income tax
purposes) created or organized in the United States or under the laws of the United States, any
state thereof or the District of
Columbia;
an estate, the income of which is subject to U.S. federal income taxation regardless of its
source; or
a trust that (1) is subject to the primary supervision of a court within the United
States and the control of one or more U.S. persons for all substantial decisions or (2) has a valid election in effect
under applicable U.S. Treasury regulations to be treated as a U.S. person.
at least 75% of its gross income for such year is passive income, or
at least 50% of the value of its assets (based on an average of the quarterly values of
the assets) during such year is attributable to assets that produce
passive income or are held for
the production of passive income (the asset test).
Table of Contents
the excess distribution or recognized gain will be allocated ratably over your holding period for the ADSs or ordinary shares,
the amount allocated to the current taxable year, and any taxable years in your holding period prior to the
first taxable year in which we became a PFIC, will be treated as ordinary income, and
the amount allocated to each other taxable year will be subject to tax at the highest tax rate in
effect for individuals or corporations, as applicable, for each such year, and the interest charge generally applicable to underpayments of tax
will be imposed on the resulting tax attributable to each such year.
Table of Contents
Table of Contents
Table of Contents
ITEM 11.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Table of Contents
ITEM 12.
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
Persons depositing or withdrawing shares must pay:
For:
Table of Contents
Persons depositing or withdrawing shares must pay:
For:
agents for servicing the deposited securities
ITEM 13.
DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
ITEM 14.
MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
Table of Contents
ITEM 15.
CONTROLS AND PROCEDURES
Controls designed to ensure that significant transactions were appropriately accounted
for did not operate effectively due to the lack of sufficient qualified and trained
personnel to review and test the application of U.S. GAAP, and significant turnover of
senior management and personnel in the finance related functions during the second half of
2009.
Table of Contents
We have strengthened our monitoring control over financial reporting to include
additional review by our chief financial officer and senior finance staff over the
application of U.S. GAAP accounting knowledge, the selection and evaluation of U.S. GAAP
accounting policies, critical accounting judgments and estimates, reporting and
disclosures.
We implemented a series of review and monitoring controls over the financial statement
closing process which will ensure complete and accurate reporting of transactions, in
particular, those unusual or non-recurring events, in compliance with U.S. GAAP.
We appointed external consultants with relevant expertise and experience in U.S. GAAP
and internal control over financial reporting to assist our management in addressing the
material weaknesses noted. These external consultants review on a top down basis the
application of U.S. GAAP. The scope of this review had a particular focus on those areas
identified by senior management and through discussions between senior management and our
auditor as being unusual, non-recurring or of a higher risk of being stated in a manner not
compliant with US GAAP.
Strengthened our internal audit team through the appointment of external consultants
with relevant experience and expertise to train and review the work of our internal audit
staff and to support our testing of internal controls over financial reporting.
Divested the consolidated entity in which the material misstatement from the
misapplication of U.S. GAAP arose and restructured our head-office and remaining operating
entities finance teams to ensure greater integration between our head-office finance team
and our operating entities.
Our audit committee is monitoring the remediation plan on an ongoing basis and providing
the necessary oversight to ensure that we are effectively addressing our material weakness.
ITEM 16A.
AUDIT COMMITTEE FINANCIAL EXPERT
ITEM 16B.
CODE OF ETHICS
Table of Contents
ITEM 16C.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
For the Year Ended December 31,
2009
2010
$
$
1,037,233
886,813
1,037,233
886,813
(1)
Audit fees means the aggregate fees billed for professional services rendered by our
principal auditors for the audit of our annual financial statements and the performance of agreed
upon procedures on our comparative unaudited interim financial statements.
ITEM 16D.
EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
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ITEM 16E.
PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
Total Dollar Amount
Approximate Dollar
of ADSs Purchased as
Value of ADSs that
Total Number of
Average Price Paid
Part of Publicly
may Yet be Purchased
Period
ADSs Purchased
Per ADS
(1)
Announced Plan
(2)
Under the Plan
(1)
33,949
$
5.0644
$
171,931
$
9,828,069
32,289
$
5.0348
$
162,569
$
9,665,500
36,393
$
4.7657
$
173,438
$
9,492,062
22,450
$
4.4485
$
99,869
$
9,392,193
25,000
$
4.2728
$
106,820
$
9,285,373
19
$
4.2800
$
81
$
9,285,292
26,261
$
3.2976
$
86,598
$
9,198,693
500
$
3.3960
$
1,698
$
9,196,995
23,139
$
3.3367
$
77,208
$
9,119,788
17,744
$
1.9904
$
35,318
$
9,084,470
27,256
$
1.5475
$
42,179
$
9,042,291
24,669
$
1.6066
$
39,633
$
9,002,658
2,400
$
1.5900
$
3,816
$
8,998,842
10,535
$
1.6111
$
16,973
$
8,981,869
12,396
$
1.5155
$
18,786
$
8,963,083
5,000
$
1.4104
$
7,052
$
8,956,031
10,000
$
0.9982
$
9,982
$
8,946,049
15,381
$
0.9651
$
14,844
$
8,931,205
15,381
$
0.9998
$
15,378
$
8,915,827
15,381
$
0.9709
$
14,933
$
8,900,893
15,381
$
0.9624
$
14,803
$
8,886,091
15,381
$
0.9423
$
14,494
$
8,871,597
21,893
$
0.8815
$
19,299
$
8,852,299
21,893
$
0.8793
$
19,251
$
8,833,048
21,293
$
0.8927
$
19,008
$
8,814,040
21,893
$
0.8550
$
18,719
$
8,795,321
21,893
$
0.8237
$
18,033
$
8,777,288
24,552
$
0.8276
$
20,319
$
8,756,969
24,552
$
0.8324
$
20,437
$
8,736,532
24,552
$
0.8262
$
20,285
$
8,716,247
24,552
$
0.8137
$
19,978
$
8,696,269
24,552
$
0.8252
$
20,260
$
8,676,009
1,470
$
1.7482
$
2,570
$
8,673,439
620,000
$
2.1396
$
1,326,561
$
8,673,439
(1)
Each of our ADSs represents two ordinary shares.
(2)
On August 12, 2008, we announced that our board of directors had approved a share repurchase
program to repurchase from the open market up to $10 million worth of our outstanding ADSs
from time to time within the next 24 months. The timing and amount of any repurchase will be
determined by our management, based on market conditions, ADS price and other factors, and
will be subject to the restrictions relating to volume, price and timing under applicable law,
including Rule 10b-18 under the Exchange Act. We have canceled the ADSs repurchased and their
underlying ordinary shares. The approval of our board of directors for the stock repurchase
program expired on August 6, 2010.
ITEM 16F.
CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT
Table of Contents
ITEM 16G.
CORPORATE GOVERNANCE
ITEM 17.
FINANCIAL STATEMENTS
ITEM 18.
FINANCIAL STATEMENTS
Table of Contents
ITEM 19.
EXHIBITS
Exhibit Number
Description of Document
1.1
2.1
2.2
2.3
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
4.10
4.11
4.12
Table of Contents
Exhibit Number
Description of Document
4.13
4.14
4.15
4.16
4.17
4.18
4.19
4.20
4.21
4.22
4.23
4.24
4.25
4.26
4.27
Table of Contents
Exhibit Number
Description of Document
4.28
4.29
4.30
4.31
4.32
4.33
4.34
4.35
4.36
4.37
4.38
4.39
4.40
*
4.41
*
4.42
*
4.43
*
Table of Contents
Exhibit Number
Description of Document
4.44
*
4.45
*
4.46
*
4.47
*
4.48
*
4.49
4.50
4.51
4.52
4.53
4.54
*
4.55
*
4.56
*
4.57
*
4.58
*
8.1
*
11.1
12.1
*
12.2
*
13.1
*
13.2
*
Table of Contents
Exhibit Number
Description of Document
15.1
*
15.2
*
15.3
*
15.4
*
*
Filed with this annual report on Form 20-F
Table of Contents
AGRIA CORPORATION
By:
/s/ Xie Tao
Name:
Xie Tao
Title:
Chief Executive Officer
Table of Contents
Page
1-2
3
4
5-6
7
8-41
Table of Contents
Agria Corporation
June 28, 2011
Table of Contents
Shenzhen, Peoples Republic of China
June 29, 2010,
except for Note 6, as to which the date is
June 28, 2011
Table of Contents
(Amounts in thousands of Renminbi (RMB) and U.S. dollars (US$),except for number of shares)
Table of Contents
Note
2008
2009
2010
2010
(RMB)
(RMB)
(RMB)
(US$)
3,000
3,013
29,022
4,397
(2,651
)
(5,285
)
(17,345
)
(2,628
)
349
(2,272
)
11,677
1,769
(166
)
(875
)
(132
)
(864,771
)
(89,453
)
(97,796
)
(14,818
)
(1,932
)
(1,156
)
(114
)
(17
)
(866,703
)
(90,775
)
(98,785
)
(14,967
)
(866,354
)
(93,047
)
(87,108
)
(13,198
)
33,744
8,489
22,448
3,401
(26
)
(40
)
(2,266
)
(343
)
(11,812
)
(16,602
)
(2,843
)
(431
)
3, 24
(548
)
1,946
295
(2,119
)
(33
)
(1,341
)
(203
)
9
90
2,799
20,634
3,126
(2,223
)
(337
)
(846,477
)
(98,982
)
(50,753
)
(7,690
)
17
(25,577
)
(10,915
)
(7,104
)
(1,076
)
(872,054
)
(109,897
)
(57,857
)
(8,766
)
6
121,053
(25,378
)
(1,314
)
(199
)
(751,001
)
(135,275
)
(59,171
)
(8,965
)
18
(6.91
)
(0.88
)
(0.49
)
(0.07
)
18
0.96
(0.20
)
(0.01
)
*
18
(5.95
)
(1.08
)
(0.50
)
(0.08
)
18
126,262,529
125,271,946
118,377,357
118,377,357
18
126,262,529
125,271,946
118,377,357
118,377,357
*
Table of Contents
2008
2009
2010
2010
(RMB)
(RMB)
(RMB)
(US$)
(751,002
)
(135,275
)
(59,171
)
(8,965
)
768,540
21,598
3,272
2,223
337
23,088
10,915
8,489
1,286
548
(1,946
)
(295
)
45,299
14,833
9,835
1,490
7,496
20,325
536
81
13,766
16,479
2,985
452
12,636
24,292
25,003
3,788
12,815
7,346
138
21
16,622
22,508
615
601
25,122
47,404
(21
)
(3
)
(5,173
)
(34,936
)
(54,496
)
(8,257
)
35,237
(8,697
)
(10,182
)
(1,543
)
(3,027
)
1,719
(1,300
)
(197
)
414
(1,536
)
(1,042
)
(158
)
2,488
(2,507
)
338
51
(5,511
)
3,939
(1,523
)
(231
)
5,262
6,163
6,283
952
(1,025
)
(805
)
42,843
6,491
5,434
403
200
30
209,096
(6,281
)
(9,210
)
(1,398
)
(414,595
)
(165,446
)
(25,067
)
(7,000
)
(40,000
)
(6,061
)
516
(663
)
(100
)
(87,486
)
(13,254
)
(69,215
)
(3,400
)
(568
)
(86
)
(256,361
)
(25,227
)
(5,502
)
13,167
17,010
2,577
(337,636
)
(429,981
)
(277,153
)
(41,991
)
Table of Contents
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
For the years ended December 31, 2008, 2009 and 2010
(Amounts in thousands of Renminbi (RMB) and U.S. dollar (US$))
2008
2009
2010
2010
(RMB)
(RMB)
(RMB)
(US$)
17,600
8,750
119,209
18,062
(23,960
)
(8,800
)
(59,605
)
(9,031
)
(136,000
)
(20,606
)
(7,252
)
(1,976
)
(13,612
)
(2,026
)
(76,396
)
(11,575
)
(68,234
)
(654
)
16,838
(2,551
)
(210,386
)
(438,942
)
(379,597
)
(57,515
)
1,387,153
1,176,767
737,825
111,792
1,176,767
737,825
358,228
54,277
1,147
980
148
1,729
262
802
209,311
11,859
182,600
27,700
204,200
30,900
(21,600
)
(3,300
)
Table of Contents
Accumulated
Additional
Other
Retained
Total
Number of
Ordinary
Paid-in
Statutory
Comprehensive
Earnings
Shareholders
Ordinary Shares
Shares
Capital
Reserves
Loss
(deficit)
Equity
(RMB)
(RMB)
(RMB)
(RMB)
(RMB)
(RMB)
126,400,000
1,561,933
76,953
(9,421
)
218,742
1,848,207
(751,002
)
(751,002
)
(68,232
)
(68,232
)
(819,234
)
768,540
768,540
(600,000
)
(7,252
)
(7,252
)
45,299
45,299
125,800,000
2,368,520
76,953
(77,653
)
(532,260
)
1,835,560
(135,275
)
(135,275
)
(656
)
(656
)
(135,931
)
(640,000
)
(1,976
)
(1,976
)
14,833
14,833
125,160,000
2,381,377
76,953
(78,309
)
(667,535
)
1,712,486
(59,171
)
(59,171
)
(16,838
)
(16,838
)
(76,010
)
76,953
(76,953
)
237
(237
)
(14,393,400
)
(182,554
)
(182,554
)
9,835
9,835
110,766,600
2,285,611
237
(95,147
)
(726,943
)
1,463,758
346,305
36
(14,417
)
(110,142
)
221,782
Table of Contents
1.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
1.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
1.
Date of
Place of
Percentage of
Principal
Name
incorporation
incorporation
shareholdings
Activities
March 29, 2007
PRC
100
%
Research and development
July 6, 2005
BVI
100
%
Investment holding
September 19, 2003
Hong Kong
100
%
Investment holding
April 11, 2008
PRC
100
%
Service of biotechnology and investment holding
November 5, 2009
Hong Kong
100
%
Sale of upstream agricultural products and investment holding
September 29, 2009
BVI
100
%
Investment holding
December 19, 2009
BVI
100
%
Investment holding
Date of
Place of
Name
incorporation
incorporation
Principal Activities
November 6, 2008
PRC
Investment holding
August 31, 1998
PRC
Research, production and marketing of edible corn seeds
November 5, 2009
Hong Kong
Sale of upstream agricultural products
September 16, 2009
PRC
Research and development
September 16, 2009
PRC
Research and development, service, sales and investment
November 5, 2009
Hong Kong
Investment holding
Aug 1, 2008
PRC
Research, production and marketing of vegetable seeds
Oct 21, 2010
PRC
Sales of corn seeds
*
**
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
2.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
2.
5-30 years
5-10 years
5 years
5-6 years
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
2.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
2.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
2.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
2.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
2.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
3.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
3.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
4.
As at September 30, 2009
(RMB000)
(US$000)
5,516
808
596
87
12,456
1,825
6,446
944
1,355
199
508
74
(5,086
)
(745
)
(13,674
)
(2,003
)
(16,233
)
(2,378
)
3,362
494
(63
)
(9
)
9,817
1,437
5,000
733
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
5.
2009
2010
2010
(RMB000)
(RMB000)
(US$000)
47,000
7,122
894
135
47,894
7,257
Share of post-
Proportion of
Cost of
acquisition
ownership
investment
profit / (loss)
Name of Associates
interest
Principal activity
(RMB000)
(RMB000)
Co., Ltd.
49.0
%
Production of corn seeds
40,000
1,183
Industry Co.,
Ltd.
18.9
%
Research and
development and
co-operation with CNAAS
7,000
(289
)
47,000
894
6.
2008
2009
2009
(RMB000)
(RMB000)
(US$000)
231,565
257,699
39,045
202,815
172,344
26,113
(232,182
)
(246,995
)
(37,423
)
202,198
183,048
27,735
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
6.
From January 1, 2010 to
Discontinued Operations
2008
2009
date of disposal
(RMB000)
(RMB000)
(RMB000)
(US$000)
465,064
173,956
112,277
17,012
121,053
(25,378
)
(192,468
)
(29,162
)
121,053
(25,378
)
(1,314
)
(199
)
7.
2009
2010
2010
(RMB000)
(RMB000)
(US$000)
119,935
423
64
(10,670
)
(139
)
(21
)
109,265
284
43
2008
2009
2010
2010
(RMB000)
(RMB000)
(RMB000)
(US$000)
(38
)
(12,853
)
(10,670
)
(1,617
)
(12,848
)
(14,664
)
(139
)
(21
)
10,670
1,617
33
7,916
8,931
(12,853
)
(10,670
)
(139
)
(21
)
8.
2009
2010
2010
(RMB000)
(RMB000)
(US$000)
7,447
10,181
1,543
6,339
1,407
213
59,586
62,780
9,512
73,372
74,368
11,268
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
9.
2009
2010
2010
(RMB000)
(RMB000)
(US$000)
40,738
40,258
6,100
4,985
106
16
29,732
1,586
240
1,005
1,772
17,414
2,639
850
(1,723
)
(60
)
(9
)
36,621
19,046
2,886
(1)
(2)
(3)
2008
2009
2010
2010
(RMB000)
(RMB000)
(RMB000)
(US$000)
(1,480
)
(1,125
)
(1,723
)
(261
)
(598
)
1,663
252
355
(1,125
)
(1,723
)
(60
)
(9
)
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
10.
2009
2010
2010
(RMB000)
(RMB000)
(US$000)
72,499
1,684
255
7,240
984
149
4,265
1,788
271
9,509
6,560
994
12,937
106,450
11,016
1,669
(18,228
)
(4,771
)
(723
)
88,222
6,245
946
11.
Gross
Carrying
Accumulated
Net Carrying
Net Carrying
Value
Amortization
Value
Value
(RMB000)
(RMB000)
(RMB000)
(US$000)
397,457
(28,541
)
368,916
54,046
42,273
(22,217
)
20,056
2,938
256
(127
)
129
19
439,986
(50,885
)
389,101
57,003
Gross
Carrying
Accumulated
Net Carrying
Net Carrying
Value
Amortization
Value
Value
(RMB000)
(RMB000)
(RMB000)
(US$000)
395,637
(45,186
)
350,451
53,098
15,000
(12,500
)
2,500
379
258
(183
)
75
11
410,895
(57,869
)
353,026
53,488
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
11.
Year ending December 31
(RMB000)
(US$000)
19,082
2,892
16,561
2,509
16,535
2,505
16,535
2,505
16,535
2,505
267,778
40,572
353,026
53,488
12.
13.
2009
2010
2010
(RMB000)
(RMB000)
(US$000)
8,750
59,604
9,031
14.
2009
2010
2010
(RMB000)
(RMB000)
(US$000)
8,601
373
56
17,594
155
24
2,115
11,494
28,347
4,296
6,684
1,133
172
1,200
8,696
6,725
1,019
12,151
9,805
1,483
5,086
3,563
4,492
682
77,184
51,030
7,732
(i)
(ii)
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
15.
16.
17.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
17.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
17.
2008
2009
2010
2010
(RMB000)
(RMB000)
(RMB000)
(US$000)
(30,479
)
(29,013
)
(24,856
)
(3,766
)
(815,998
)
(69,969
)
(25,897
)
(3,924
)
(846,477
)
(98,982
)
(50,753
)
(7,690
)
2008
2009
2010
2010
(RMB000)
(RMB000)
(RMB000)
(US$000)
2,488
5,719
866
23,089
10,915
1,385
210
25,577
10,915
7,104
1,076
2008
2009
2010
2010
(RMB000)
(RMB000)
(RMB000)
(US$000)
(846,477
)
(98,982
)
(50,753
)
(7,690
)
(211,619
)
(24,746
)
(12,688
)
(1,923
)
205,365
5,597
838
127
(50
)
(8
)
568
86
28,722
10,596
4,502
682
2,787
19,523
13,838
2,097
322
(55
)
96
15
25,577
10,915
7,104
1,076
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
17.
2009
2010
2010
(RMB000)
(RMB000)
(US$000)
131
11
2
5,144
802
122
1,513
1,184
179
137
19,406
13,838
2,097
219
35
5
26,550
15,870
2,405
(23,070
)
(13,838
)
(2,097
)
3,480
2,032
308
(63
)
(63
)
(191,154
)
(191,154
)
2009
2010
2010
(RMB)
(RMB)
(US$)
7,751
12,492
1,893
983
1,271
2,487
(8,733
)
(1,323
)
12,492
3,759
570
*
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
17.
18.
19.
Name of Related Parties
Relationship with the Group
A company owned by a director of P3A
A subsidiary of Taiyuan Relord
A director of P3A
A director of P3A
A director of P3A
A 49% Associate
A 18.9% Associate
A 19.0% Associate
*
(1)
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
2008
2009
2010
2010
(RMB000)
(RMB000)
(RMB000)
(US$000)
26,019
3,942
3,044
461
204
102
15
6
6
216
29,165
4,418
910
138
6,464
979
*
(2)
(i)
(ii)
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
20.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
20.
Weighted-
Weighted-
Average
Aggregate
Weighted-
average
Remaining
Intrinsic
Number of
average
grant-date
Contractual
Value
Share Option
Shares
Exercise Price
fair value
Term
(US$000)
9,120,500
19,239
2,434,000
US$
0.87
(510,000
)
(2,200,000
)
8,844,500
US$
2.97
2,340,000
0.92
0.44
(784,600
)
2.81
1.59
(450,000
)
2.40
1.65
9,949,900
2.53
3.30
6.72
1,735
9,949,900
2.53
3.30
6.72
1,735
5,494,500
2.71
0.56
6.05
581
9,949,900
US$
2.53
3.30
5,160,000
1.00
0.24
(735,000
)
2.69
1.02
(1,136,800
)
2.77
1.56
13,238,100
1.90
2.38
8.18
94
13,238,100
1.90
2.38
8.18
94
6,373,567
US$
2.46
US$
1.08
7.44
31
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
20.
2008
2009
2010
2.67% 4.23%
3.17%
3.26% 3.30%
34.91% 49.94%
48.62%
62.21% 62.35%
40.19%
48.62%
62.33%
3.31 5.58
2.77
3.93
For the years ended December 31,
2008
2009
2010
2010
RMB000
RMB000
RMB000
US$000
520
206
44,732
14,596
9,835
1,490
47
31
45,299
14,833
9,835
1,490
21.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
22.
Year ending December 31
(RMB000)
(US$000)
2,898
439
2,371
359
561
85
347
53
347
53
4,514
683
11,038
1,672
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
22.
23.
24.
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
24.
Level 1
Observable inputs that reflect quoted prices (unadjusted) for identical assets
or liabilities in active markets.
Level 2
Include other inputs that are directly or indirectly observable in the marketplace.
Level 3
Unobservable inputs which are supported by little or no market activity.
Fair Value Measurement at December 31, 2009
Quoted Prices
in
Active
Significant
Markets for
Other
Identical
Observable
Unobservable
Fair Value at
Fair Value at
Assets
Inputs
Inputs
December 31,
December 31,
(Level 1)
(Level 2)
(Level 3)
2009
2009
(RMB000)
(RMB000)
(RMB000)
(RMB000)
(US000)
414,047
414,047
60,658
Fair Value Measurement at December 31, 2010
Quoted Prices
in
Active
Significant
Markets for
Other
Identical
Observable
Unobservable
Fair Value at
Fair Value at
Assets
Inputs
Inputs
December 31,
December 31,
(Level 1)
(Level 2)
(Level 3)
2010
2010
(RMB000)
(RMB000)
(RMB000)
(RMB000)
(US000)
403,490
403,490
61,135
25.
a)
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
25.
b)
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
25.
c)
26.
2008
2009
2010
2010
(RMB000)
(RMB000)
(RMB000)
(US$000)
(19,744
)
(26,700
)
(26,293
)
(3,983
)
(19,744
)
(26,700
)
(26,293
)
(3,983
)
(19,744
)
(26,700
)
(26,293
)
(3,983
)
23,735
3,379
385
58
(14
)
(22
)
(21
)
(3
)
(433
)
24
(70
)
(11
)
(752,842
)
(111,956
)
(48,345
)
(7,325
)
19,557
2,963
(749,298
)
(135,275
)
(54,787
)
(8,301
)
(1,704
)
(4,384
)
(664
)
(751,002
)
(135,275
)
(59,171
)
(8,965
)
(751,002
)
(135,275
)
(59,171
)
(8,965
)
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
26.
2008
2009
2010
2010
(RMB)
(RMB)
(RMB)
(US$)
(751,002
)
(135,275
)
(59,171
)
(8,965
)
752,842
111,956
48,345
7,325
1,422
(616
)
(6,271
)
(950
)
1,704
(1,704
)
(390
)
(59
)
(833
)
9,651
1,883
285
4,133
(15,988
)
(15,604
)
(2,364
)
(230,918
)
(737,525
)
(38,852
)
(5,888
)
(230,918
)
(737,525
)
(38,852
)
(5,888
)
(7,252
)
(1,976
)
(7,252
)
(1,976
)
(63,764
)
(87
)
(16,838
)
(2,551
)
(297,801
)
(755,576
)
(71,294
)
(10,803
)
1,142,017
844,216
88,640
13,430
844,216
88,640
17,346
2,627
Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the years ended December 31, 2008, 2009 and 2010
Pages | ||||
ARTICLE I DEFINITIONS
|
1 | |||
SECTION 1.01. Certain Defined Terms
|
1 | |||
ARTICLE II PURCHASE AND SALE
|
3 | |||
SECTION 2.01. Purchase and Sale
|
3 | |||
SECTION 2.02. Purchase Price
|
3 | |||
SECTION 2.03. Closing
|
3 | |||
SECTION 2.04. Deliveries at the Closing
|
3 | |||
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE SELLER
|
4 | |||
SECTION 3.01. Authority to Execute and Perform this Agreement
|
4 | |||
SECTION 3.02. Transferred Shares
|
4 | |||
SECTION 3.03. No Conflicts
|
4 | |||
SECTION 3.04. Controlling Agreements
|
4 | |||
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
|
5 | |||
SECTION 4.01. Authority to Execute and Perform this Agreement
|
5 | |||
ARTICLE V UNDERTAKINGS
|
5 | |||
SECTION 5.01. Confidentiality
|
5 | |||
SECTION 5.02. Consents and Approvals in relation to the Lease Transfer Agreements
|
5 | |||
ARTICLE VI CONDITIONS PRECEDENT
|
6 | |||
SECTION 6.01. Conditions Precedent to the Obligations of the Seller and the Purchaser
|
6 | |||
SECTION 6.02. Conditions Precedent to the Purchasers Obligations
|
6 | |||
SECTION 6.03. Conditions Precedent to the Sellers Obligations
|
7 | |||
ARTICLE VII INDEMNIFICATION
|
7 | |||
SECTION 7.01. Indemnification by the Seller
|
7 | |||
SECTION 7.02. Indemnification by the Purchaser
|
7 | |||
ARTICLE VIII GENERAL PROVISIONS
|
8 | |||
SECTION 8.01. Expenses
|
8 | |||
SECTION 8.02. Termination
|
8 | |||
SECTION 8.03. Notices
|
8 | |||
SECTION 8.04. Severability
|
8 | |||
SECTION 8.05. Amendment
|
9 | |||
SECTION 8.06. Governing Law, Arbitration
|
9 | |||
SECTION 8.07. Assignment and Succession
|
9 | |||
SECTION 8.08. Headings
|
9 | |||
SECTION 8.09. Language
|
9 |
1
2
3
4
5
6
7
|
If to the Seller: | |||
|
||||
|
Xue Zhixin
Address: 25th Floor, Jin Gang Hotel, No.91 Bing Zhou North Road, Taiyuan City, Shanxi Province |
|||
|
||||
|
Fax: 0351-4727112 | |||
|
||||
|
If to the Purchaser: | |||
|
||||
|
Agria Corporation
Address: 21/F Tower B, PingAn International Finance Center, 1-3 Xinyuan South Road, Chaoyang District, Beijing, China |
|||
|
||||
|
Attn: Xie Tao | |||
|
||||
|
Fax: 010-84381003 |
8
9
Seller
:
|
||||
By: | /s/ Xue Zhixin | |||
Name: | Xue Zhixin | |||
Purchaser
:
AGRIA CORPORATION |
||||
By: | /s/ Xie Tao | |||
Name: | Xie Tao | |||
Title: | Chief Executive Officer |
10
1. |
Power of Attorney
|
|
2. |
Equity Pledge Agreement
|
|
3. |
Exclusive Call Option Agreement
|
|
4. |
Exclusive Technology Development, Technology Support and Technology Service
Agreement
|
|
5. |
Exclusive Consultancy Service Agreement
|
|
6. |
Proprietary Technology License Agreement
|
|
7. |
Letter of Undertaking
|
11
Appendix A:
|
Assignment and Assumption Agreement regarding the Exclusive Call Option Agreement | |
|
||
Appendix B:
|
Assignment and Assumption Agreement regarding the Exclusive Technology Development, Technology Support and Technology Service Agreement | |
|
||
Appendix C:
|
Termination Notice regarding the Exclusive Consultancy Service Agreement | |
|
||
Appendix D:
|
Termination Notice regarding the Proprietary Technology License Agreement | |
|
||
Appendix E:
|
Termination Notice regarding the Equity Pledge Agreement | |
|
||
Appendix F:
|
New Letter of Undertaking | |
|
||
Appendix G:
|
Lease Transfer Agreements |
12
1. |
Assignment and Assumption
|
2. |
Consideration
|
3. |
Closing
|
4. |
Representations and Warranties
|
a. |
The Assignor represents and warrants to the Assignee that:
|
(i) |
it has not assigned, mortgaged, pledged,
encumbered, or otherwise hypothecated any of its right, title or
interest under the Exclusive Call Option Agreement, except as set forth
in this Assignment;
|
||
(ii) |
the execution, delivery and performance of this
Assignment, including but not limited to the consummation of the
transactions contemplated hereby and thereby do not and will not
violate, conflict with or result in a breach of, or constitute a
default (or create an event which, with notice or lapse of time or
both, would constitute a default in the Exclusive Call Option
Agreement) of the terms, conditions or provisions under the Exclusive
Call Option Agreement; and
|
||
(iii) |
the Assignor has full power and authority to
enter into this Assignment, perform the obligations of such party
hereunder and consummate the transactions contemplated hereby. All
necessary and appropriate action has been taken by such party with
respect to the execution and delivery of this Assignment. This
Assignment constitutes the valid and binding obligation of such party
enforceable in accordance with the terms hereof, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors
rights and to general equity principles.
|
b. |
the Assignee represents and warrants to the Assignor that it
has full power and authority to enter into this Assignment, perform the
obligations of such party hereunder and consummate the transactions
contemplated hereby. All necessary and appropriate action has been taken by
such party with respect to the execution and delivery of this Assignment. This
Assignment constitutes the valid and binding obligation of such party
enforceable in accordance with the terms hereof, subject to bankruptcy,
insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors rights and to general equity principles.
|
2
5. |
Conditions Precedent
|
a. |
the obligations of the Assignor to complete the Closing, unless
otherwise waived in writing by the Assignor, are subject to the fulfillment of
each of the following conditions on or before the Closing Date:
|
(i) |
the representations and warranties of the
Assignee shall be true and correct on the Closing Date;
|
||
(ii) |
the Share Purchase Agreement has been fully
executed;
|
||
(iii) |
the documents required in Section 6.01(a) to
Section 6.01(f) under the Share Transfer Agreement have been fully
executed; and
|
||
(iv) |
the conditions required in Section 6.02 under
the Share Transfer Agreement have been satisfied.
|
b. |
The obligations of the Assignee to complete the Closing, unless
otherwise waived in writing by the Assignee, are subject to the fulfillment of
each of the following conditions on or before the Closing Date:
|
(i) |
the representations and warranties of the
Assignor shall be true and correct on the Closing Date;
|
||
(ii) |
the Share Purchase Agreement has been fully
executed; and
|
||
(iii) |
the conditions required in Section 6.03 under
the Share Transfer Agreement have been satisfied.
|
6. |
Termination
|
7. |
Expense
|
3
8. |
Severability
|
9. |
Amendment
|
10. |
Assignment and Succession
|
11. |
Governing Law, Arbitration
|
4
12. |
Notices
|
|
If to the Assignor: | |||
|
||||
|
Aero-Biotech Science & Technology Co., Ltd.
Address: 21th Floor, Tower B, Pingan International Financial Center, No. 1-3 Xinyuan South Road, Chaoyang District, Beijing Attn: Xie Tao Fax: 010-84381003 Postcode: 100027 |
|||
|
||||
|
If to the Assignee: | |||
|
||||
|
Mr. Xue Zhixin
Address: 25th Floor, Jin Gang Hotel, No.91 Bing Zhou North Road, Taiyuan City, Shanxi Province Attn: Xue Zhixin Fax: 0351-4727112 Postcode: 030001 |
13. |
Headings
|
14. |
Language
|
5
ASSIGNOR | ASSIGNEE | |||||||||
|
||||||||||
Aero-Biotech Science & Technology Co., Ltd. | Xue Zhixin | |||||||||
|
||||||||||
By: | /s/ Xie Tao | /s/ Xue Zhixin | ||||||||
|
Name: | Xie Tao | ||||||||
|
Title: | Chief Executive Officer | ||||||||
|
||||||||||
Seal:
|
6
(1) |
Party A is a citizen of the Peoples Republic of China, who owns non-patent technologies
listed in Annex I (such technologies and related information, manual, handbook, files, etc.
hereinafter referred to as Proprietary Technology);
|
(2) |
Party B is a limited liability company duly registered and established in Taiyuan City,
Shanxi Province of China under the laws of China and primarily engages in the development and
production of agricultural seeds, tree seeds and species of live stock;
|
(3) |
Party A agrees to grant to Party B the exclusive right to use the Proprietary Technology
under this Agreement in accordance with the terms and conditions of this Agreement, and Party
B agrees to accept such license in accordance with the same terms and conditions.
|
1. |
PERMISSION GRANT
|
|
1.1 |
Proprietary Technology
|
(a) |
Party A agrees, according to the terms and conditions under this Agreement, to
grant to Party B, and Party B agrees to accept the right to use the Proprietary
Technology in China according to the same terms and conditions. The license under this
Agreement is exclusive, and except with the written consent of Party A, Party B shall
not transfer the Proprietary Technology to any third party, nor shall it jointly share,
use, develop, improve or innovate the Proprietary Technology with any third party.
|
(b) |
Both parties agree that, should there be any improvement or innovation
technological achievements resulted during the course of using the Proprietary
Technology by Party B, the relevant rights and ownership shall be exclusively vested in
Party A unless it is otherwise provided by Chinese laws and regulations or mutually
agreed by both parties. Party B shall not hold any rights and interests.
|
1.2 |
Scope
|
(a) |
The Proprietary Technology granted to Party B herein shall only be used on
Party Bs business in development and production of stock breeding. Unless provided in
this contract to the contrary, without written consent of Party A, Party B shall not
use the Proprietary Technology in other purpose or re-license for the use of any third
party, whether for normal application, training or commercial sharing.
|
(b) |
The right granted to Party B to use the Proprietary Technology herein shall be
effective only in China. Party B agrees not to use such Proprietary Technology, whether
directly or indirectly, in other geographical areas.
|
2. |
PAYMENT METHOD
|
3. |
PARTY AS RIGHTS AND PROTECTION
|
3.1 |
In the effective term of this Agreement and thereafter, Party B agrees not to challenge or
question the validity of the proprietary right and this Agreement in connection with the
aforesaid Proprietary Technology; and not to perform any acts that Party A believes will
impair Party As rights and license.
|
3.2 |
Party B agrees to provide the necessary assistance to protect Party As rights on the
Proprietary Technology. Should any third party bring an infringement claim against Party As
Proprietary Technology, at Party As discretion, Party A may respond to such compensation
litigation in its own name, in Party Bs name or in both parties name. In the event any third
party commits any infringement behavior in connection with such Proprietary Technology, Party
B shall notify Party A such immediately within its scope of knowledge; only Party A is
entitled to decide whether to take action against such infringement behavior.
|
3.3 |
Party B agrees to use the Proprietary Technology only in the manner as provided in this
Agreement and shall not use the Proprietary Technology in any manner which Party A deems as
deceptive, misleading or in other manner that may impair the Proprietary Technology or Party
As reputation.
|
2
4. |
CONFIDENTIALITY PROVISIONS
|
4.1 |
Party B shall keep confidential all the material and information (hereinafter referred to as
Confidential Information
) understood or accessed by Party B as a result of accepting
the Proprietary Technology license; and upon the termination of this Agreement, Party B
shall, upon Party As request, return to Party A or destroy any such documents and materials
that contain Confidential Information, and shall delete any Confidential Information from
any relevant memory device, and shall discontinue using such Confidential Information.
Without the written consent of Party A, Party B shall not disclose to any third party, give
or transfer such Confidential Information.
|
4.2 |
Both parties agree that this Article 4 shall remain valid regardless of whether this
Agreement shall become invalid, altered, discharged, terminated or unenforceable.
|
5. |
REPRESENTATION AND WARRANTY
|
|
5.1 |
Party A represents and warrants as follows:
|
(a) |
Party A has the right to execute and perform this Agreement and to adopt all
necessary and appropriate corporate actions to execute and deliver this Agreement not
to in violation of any restrictions imposed by laws and agreement binding or having an
effect upon it.
|
(b) |
This Agreement, once executed, shall constitute legitimate, valid, binding and
enforceable obligations on Party A under the conditions of this Agreement.
|
||
(c) |
Party A shall hold full and complete rights towards the Proprietary Technology.
|
5.2 |
Party B represents and warrants as follows:
|
(a) |
Party B is a validly existing limited liability company legally registered in
accordance with the Chinese laws.
|
(b) |
Party B signs and perform this Agreement within the power and business scope of
the company; adopted all necessary corporate actions, duly authorized, and obtained the
consent and approvals (as required) of third party or government; and not to in
violation of any restrictions imposed by laws and company policies and agreement
binding or having an effect upon it.
|
(c) |
This Agreement, once executed, shall constitute legitimate, valid, binding and
enforceable obligations on Party B under the conditions of this Agreement.
|
6. |
EFFECTIVENESS AND TERM
|
6.1 |
This Agreement shall be effective when it is executed on the date written on the first page
of this Agreement. Unless it is early terminated according to this Agreement, this Agreement
shall remain effective during the operation term of Party B.
|
6.2 |
On written consent by both parties, this Agreement is renewable upon expiry and the renewal
term shall be determined by both parties through consultation.
|
3
7. |
DEFAULT RESPONSIBILITY AND TERMINATION
|
|
7.1 |
Default Responsibility
|
7.2 |
Discharge and Termination
|
|
During the effective term of this Agreement, Party A may, at any time, by giving a thirty
(30) day prior written notice to Party B, terminate this Agreement; unless as otherwise
expressly provided herein, without a reasonable written consent of Party A, Party B shall
not terminate or discharge this Agreement unilaterally.
|
||
7.3 |
Results of Termination or Expiration
|
8. |
FORCE MAJEURE
|
8.1 |
Force Majeure
refers any event that is beyond the reasonable control of a party,
and it is unavoidable even under the reasonable care of the affected party, such events shall
include but not limited to: acts of government, forces of nature, fire, explosion, typhoon,
floods, earthquakes, tidal, lightning or war. However, credit, capital or financing shortage
shall not be considered as matters beyond a partys reasonable control. The party, affected by
Force Majeure, seeks exemption from performing its responsibilities under this Agreement or
under any provision of this Agreement, shall notify the other party as soon as possible
regarding such matter of exemption
|
8.2 |
When the performance of this Agreement is delayed or prevented due to the aforementioned
definition of Force Majeure, the affected party shall not assume any responsibility under
this Agreement provided that the affected party has endeavored its reasonable effort to
perform the agreement and to the extent of the part of the performance being delayed or
prevented. Once the cause of such liability exemption is redressed or remedied, both parties
agree to resume the performance of this Agreement with their best effort. If the influence of
force majeure has rendered the performance of this Agreement becomes impossible, both parties
agree, at the request of Party A, to use their greatest efforts to adopt other resolutions to
realize the purposes of this Agreement.
|
4
9. |
DISPUTE RESOLUTION
|
10. |
NOTICE
|
5
11. |
RETRANSFER, SUBLICENSE
|
|
Without the prior written consent of Party A, Party B shall not transfer, pledge or
sublicense the rights and obligations of and under this Agreement.
|
||
12. |
GOVERNING LAW
|
|
The validity, performance and interpretation of this Agreement shall be governed by laws of
China.
|
||
13. |
AMENDMENT AND SUPPLEMENT
|
|
Amendments and supplements to this Agreement shall be made in the form of a written
instrument. The relevant amendment agreement and supplemental agreement to this Agreement,
duly signed by both parties, shall be an integral part of this Agreement and shall have the
same legal effect as this Agreement.
|
||
14. |
SEVERABILITY
|
|
If any provision of this Agreement is held invalid or unenforceable due to the inconsistency
with the relevant laws, then such provision shall be deemed invalid only within the scope of
the related jurisdiction and that it shall not affect the legality of the other provisions
under this Agreement.
|
||
15. |
ANNEX
|
|
Any annex of this Agreement is an integral part of this Agreement, and it shall have the
same legal effect.
|
||
IN WITNESS WHEREOF, both parties have caused their legal representative or authorized
representative to execute this Agreement on the date first above written.
|
||
16. |
DUPLICATES
|
|
This Agreement is signed in quadruplicate, each party holds two originals and each original
shall have the same legal force and effect.
|
6
PARTY A: Xue Zhixin | ||||||
|
||||||
Signature: | /s/ Xue Zhixin | |||||
|
||||||
PARTY B : Primalights III Agriculture Development Co., Ltd. | ||||||
|
||||||
Signature: | /s/ Xue Zhixin | |||||
|
Name: | Xue Zhixin | ||||
|
Title: | Legal Representative | ||||
|
||||||
Seal:
|
7
8
1. |
Assignment and Assumption
|
2. |
Closing
|
3. |
Representations and Warranties
|
a. |
The Assignor represents and warrants to the Assignee that:
|
(i) |
it has not assigned, mortgaged, pledged,
encumbered, or otherwise hypothecated any of its right, title or
interest under the Technology Development Agreement, except as set
forth in this Assignment;
|
(ii) |
the execution, delivery and performance of this
Assignment, including but not limited to the consummation of the
transactions contemplated hereby and thereby do not and will not
violate, conflict with or result in a breach of, or constitute a
default (or create an event which, with notice or lapse of time or
both, would constitute a default in the Technology Development
Agreement) of the terms, conditions or provisions under the Technology
Development Agreement;
|
(iii) |
the Assignor has full power and authority to
enter into this Assignment, perform the obligations of such party
hereunder and consummate the transactions contemplated hereby. All
necessary and appropriate action has been taken by such party with
respect to the execution and delivery of this Assignment. This
Assignment constitutes the valid and binding obligation of such party
enforceable in accordance with the terms hereof, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors
rights and to general equity principles.
|
b. |
The Assignee represents and warrants to the Assignor that it
has full power and authority to enter into this Assignment, perform the
obligations of such party hereunder and consummate the transactions
contemplated hereby. All necessary and appropriate action has been taken by
such party with respect to the execution and delivery of this Assignment. This
Assignment constitutes the valid and binding obligation of such party
enforceable in accordance with the terms hereof, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors rights and to general
equity principles.
|
2
4. |
Conditions Precedent
|
a. |
the obligations of the Assignor to complete the Closing, unless
otherwise waived in writing by the Assignor, are subject to the fulfillment of
each of the following conditions on or before the Closing Date:
|
(i) |
the representations and warranties of the
Assignee shall be true and correct on the Closing Date;
|
(ii) |
the Share Purchase Agreement has been fully
executed;
|
(iii) |
the documents required in Section 6.01(a) to
Section 6.01(f) under the Share Transfer Agreement have been fully
executed; and
|
(iv) |
the conditions required in Section 6.02 under
the Share Transfer Agreement have been satisfied.
|
b. |
The obligations of the Assignee to complete the Closing, unless
otherwise waived in writing by the Assignee, are subject to the fulfillment of
each of the following conditions on or before the Closing Date:
|
(i) |
the representations and warranties of the
Assignor shall be true and correct on the Closing Date;
|
(ii) |
the Share Purchase Agreement has been fully
executed; and
|
(iii) |
the conditions required in Section 6.03 under
the Share Transfer Agreement have been satisfied.
|
5. |
Termination
|
||
This Assignment shall be terminated at any time prior to the Closing by a mutual
written consent of the Assignor and the Assignee.
|
|||
6. |
Expense
|
||
All costs and expenses, including but not limited to, fees and disbursements of
counsel, financial advisors and accountants, incurred in connection with this
Assignment and the transactions contemplated hereby shall be paid by the party
incurring such costs and expenses.
|
|||
7. |
Severability
|
||
If any term or other provision of this Assignment is invalid, illegal or incapable
of being enforced by any law or public policy, all other terms and provisions of
this Assignment shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not affected
in any manner materially adverse to either party hereto. Upon such determination
that any term or other provision is invalid, illegal or incapable of being enforced,
the parties hereto shall negotiate in good faith to modify this Assignment so as to
effect the original intent of the parties as closely as possible in an acceptable
manner in order that the transactions contemplated hereby are consummated as
originally contemplated to the greatest extent possible.
|
3
8. |
Amendment
|
||
This Assignment may not be amended or modified except by an instrument in writing
signed by, or on behalf of, the Assignor and the Assignee.
|
|||
9. |
Assignment and Succession
|
||
This Assignment may not be assigned by operation of law or otherwise without the
express written consent of the other party (which consent may be granted or withheld
in the sole discretion of such party). This Assignment shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
|
|||
10. |
Governing Law, Arbitration
|
||
This Agreement shall be governed by, and construed in accordance with, the Laws of
the Peoples Republic of China. In the event that a dispute arises in connection
with the interpretation or implementation of this Agreement, the parties shall
attempt in the first instance to resolve such dispute through friendly
consultations. If the dispute is not resolved through consultations within thirty
(30) days after any party has served a written notice on the other parties
requesting the commencement of consultations, then any party may submit the dispute
for arbitration to the China International Economic and Trade Arbitration Commission
in accordance with its rules in force at the time. The arbitration shall take place
in Beijing and be conducted in Chinese. The arbitration award shall be final,
binding and non-appealable on the parties.
|
|||
11. |
Notices
|
||
All notices, requests, claims, demands and other communications hereunder will be in
writing and will be given or made and will be deemed to have been duly given or made
upon receipt by delivery in person, by courier service, by confirmed telecopy (with
a copy sent by another means specified herein), or by registered or certified mail
(postage prepaid, return receipt requested) to the parties at the following
addresses or at such other address for a party as will be specified by like notice.
|
|
If to the Assignor: | |||
|
||||
|
Aero-Biotech Science & Technology Co., Ltd.
Address: 21th Floor, Tower B, Pingan International Financial Center, No. 1-3 Xinyuan South Road, Chaoyang District, Beijing Attn: Xie Tao Fax: 010-84381003 Postcode: 100027 |
4
|
If to the Assignee: | |||
|
||||
|
Mr. Xue Zhixin
Address: 25th Floor, Jin Gang Hotel, No.91 Bing Zhou North Road, Taiyuan City, Shanxi Province Fax: 0351-4727112 Postcode: 030001 |
12. |
Headings
|
13. |
Language
|
5
ASSIGNOR | ASSIGNEE | |||||||||
|
||||||||||
Aero-Biotech Science & Technology Co., Ltd. | Xue Zhixin | |||||||||
|
||||||||||
By: | /s/ Xue Tao | /s/ Xue Zhixin | ||||||||
|
Name: | Xie Tao | ||||||||
|
Title: | Chief Executive Officer | ||||||||
|
||||||||||
Seal:
|
6
To:
|
Primalights III Agriculture Development Co., Ltd. | |
|
||
|
Address: Middle Area of Highway 73, Zhuang Er Shang Village,
Huang Ling Rural Area, Xiaodian District, Taiyuan City |
|
|
||
|
Fax: 0351- 7123671 | |
|
||
|
Tel: 0351- 7870123 |
Very truly yours, | ||||||
|
||||||
Aero-Biotech Science & Technology Co. Ltd. | ||||||
|
||||||
Signature: | /s/ Xie Tao | |||||
|
Name: | Xie Tao | ||||
|
Title: | Chief Executive Officer |
1. |
Party A is citizen of the Peoples Republic of China.
|
|
2. |
Party B is a limited liability company established and registered in Taiyuan City, Shanxi
Province of China under Chinese laws. Its scope of business includes automation control
greenhouse construction, yield farmland development; demonstration plots set up, corn seed
production; crop seeds wholesale and retail, seedling seed production, wholesale and retail,
livestock, processing and marketing of agricultural and sideline products.
|
3. |
Party A agrees to provide under this Agreement consulting services to Party B and Party B
agrees to accept such consulting services from Party A.
|
4. |
EXCLUSIVE CONSULTANCY AND SERVICES; MONOPOLIZED AND EXCLUSIVE INTERESTS
|
4.1 |
During the term of this Agreement, Party A agrees, in accordance with the terms and
conditions of this Agreement, to provide to Party B the exclusive consultancy services in the
aspect of management, marketing promotion and sales, including, but not limited to:
|
(a) |
assist Party B to formulate the management model and operational plan of the
company;
|
||
(b) |
assist Party B to formulate the marketing development plan;
|
||
(c) |
provide marketing and client resources information to Party B;
|
||
(d) |
conduct specific marketing research and survey;
|
||
(e) |
assist Party B to establish a sales and marketing network.
|
4.2 |
Party B agreed to accept the consulting services rendered by Party A. Party B further agrees
that unless with a prior written consent of Party A, during the term of this Agreement, Party
B shall not accept professional consulting and services provided by any third party.
|
5. |
CALCULATION, PAYMENT AND SECURITY OF CONSULTING SERVICE
|
5.1 |
Both parties agree to calculate and pay the consulting service fee under this Agreement
according to Annex 1.
|
5.2 |
Both parties shall be responsible to pay their respective taxes for executing and performing
this Agreement as legally required.
|
(a) |
Party A executes and performs this Agreement within his power, with the
necessary and appropriate actions to sign and deliver, and that this Agreement is not
in violation of the restrictions or limitation under the laws and agreements binding or
influential to him;
|
||
(b) |
Once this Agreement is signed, it constitutes legal, valid, binding and
enforceable obligations to Party A under the provisions of this Agreement.
|
6.2 |
Party B hereby represents and warrants as follows:
|
(a) |
Party B is a limited liability company legitimately registered, established and
validly existing in accordance with Chinese laws, and that its main business involves
the development and production of agroforestry species;
|
||
(b) |
Party B performs and executes this Agreement within the power and business
scope of the company, with the necessary and appropriate corporate action and
authorization, and obtained the necessary approval and consent of the government and
third-party, and that it is not in violation of the restriction and limitations under
the laws and agreements binding or influential to it;
|
||
(c) |
Once this Agreement is signed, it constitutes legal, valid, binding and
enforceable obligations to Party B under the provisions of this Agreement.
|
7. |
CONFIDENTIALITY
|
2
8. |
EFFECTIVENESS AND TERM
|
|
8.1 |
This Agreement shall be effective on the date it is signed.
|
8.2 |
This Agreement shall remain effective within the operating term of Party B, unless it is
early terminated by the provisions of another relevant contract entered separately by both
parties or by the provisions of this Agreement.
|
|
9. |
TERMINATION
|
9.1 |
EARLY TERMINATION. During the effective term of this Agreement, unless Party A commits gross
negligence, fraud, other violations of law or bankruptcy, Party B shall not early terminate
this Agreement. Notwithstanding the aforesaid covenant, Party A is entitled to terminate this
Agreement by giving a written notice thirty (30) days in advance to Party B at any time.
During the term of this Agreement, if Party B violates this Agreement, Party A can terminate
this Agreement by giving a written notice to Party B.
|
12.1 |
Force majeure refers to any event that is beyond the reasonable control of a party, it is
unavoidable even the affected party has given reasonable attention to it, including but not
limited to, the acts of government, acts of nature, fire, explosion, typhoon, flood,
earthquake, tidal, lightning or war. However, credit, capital or financing shortage shall not
be considered as matters beyond the partys reasonable control. The party, affected by the
force majeure and seeking to remove its responsibilities of this Agreement, shall promptly
notify the other party regarding such responsibilities exemption matter and let to the other
party know the steps to be taken to fulfill it.
|
12.2 |
When the performance of this Agreement is delayed or prevented due to force majeure, the
affected party shall not assume any responsibility under this Agreement to the extent it is
within the scope of the delay or prevention. The affected party shall
take appropriate measures to reduce or eliminate the impact of force majeure and take
effort to resume the performance of the obligation delayed or prevented by the event of
force majeure . Once the event of force majeure is removed, both parties agree to resume
the performance of this Agreement with their greatest efforts.
|
3
13. |
NOTICE
|
4
14. |
ENTIRE AGREEMENT
|
15. |
SEVERABILITY
|
16. |
AMENDMENTS AND SUPPLEMENTS
|
17. |
COUNTERPART
|
5
PARTY A: Mr. Xue Zhixin | ||||||
|
||||||
Signature: | /s/ Xue Zhixin | |||||
|
||||||
PARTY B: Primalights III Agriculture Development Co., Ltd. | ||||||
|
||||||
Signature: | /s/ Xue Zhixin | |||||
|
Name: | Xue Zhixin | ||||
|
Title: | Legal Representative |
6
1. |
Formula for calculation
|
|
Party B shall pay RMB
million consulting service fee every year to Party A.
|
||
2. |
Payment method
|
(i) |
Every fiscal year Party A will issue a settlement statement to Party B,
according to the content of the services provided to Party B, and submit to Party B in
writing for verification and confirmation.
|
||
(ii) |
Party B shall pay the consulting service fee to Party As designated account
within the due date as indicated in the settlement statement provided by Party A. Party
B should facsimile or mail the copy of remittance voucher to Party A.
|
3. |
Adjustment mechanism
|
|
If Party A deems that the pricing mechanism stipulated in this agreement is inapplicable for
some reason that the pricing mechanism needs to be adjusted, Party A should negotiate with
Party B actively and in good faith to determine a new standard or mechanism of charges,
within 7 working days after Party As written request for such adjustment.
|
7
To:
|
Primalights III Agriculture Development Co., Ltd. | |
|
Address: Primalights III Agriculture Development Co., Ltd.
Middle Area of Highway 73, Zhuang Er Shang Village, |
|
|
Huang Ling Rural Area, Xiaodian District, Taiyuan City | |
|
||
|
Tel: 0351- 7870123 | |
|
||
|
Fax: 0351- 7123671 |
Very truly yours, | ||||||
|
||||||
Aero-Biotech Science & Technology Co. Ltd. | ||||||
|
||||||
Signature: | /s/ Xie Tao | |||||
|
Name: | Xie Tao | ||||
|
Title: | Chief Executive Officer |
To:
|
Primalights III Agriculture Development Co., Ltd.
Address: Middle Area of Highway 73, Zhuang Er Shang Village, Huang Ling Rural Area, Xiaodian District, Taiyuan City Fax: 0351- 7123671 Tel: 0351- 7870123 |
|
|
||
|
Juan Li
PRC Identification Card No. : 420983197609010023 Units 1 & 8, 17th Floor, Duty-free Business Building, No.6 Fu Hua First Road, Futian District, Shenzhen City Fax: 0755-82766965 Tel: 0755-82766980 |
|
|
||
|
Zhaohua Qian
PRC Identification Card No. : 130224670510033 Room 716, Huan Tai Building, South Street, Zhong Guan Cun, Haidian District, Beijing Fax: 010-62109298 Tel: 010-62109299 |
|
|
||
|
Zhixin Xue
PRC Identification Card No. : 140102196210230813 Address: 25th Floor, Jin Gang Hotel, No.91 Bing Zhou North Road, Taiyuan City, Shanxi Province Fax: 0351-4727112 Tel: 0351-4727118 |
|
|
||
|
Mingshe Zhang
PRC Identification Card No. : 140104710212037 25th Floor, Jin Gang Hotel, No.91 Bing Zhou North Road, Taiyuan City, Shanxi Province Fax: 0351-4727111 Tel: 0351-4727111 |
Aero-Biotech Science & Technology Co., Ltd. | ||||||
|
||||||
By: | /s/ Xie Tao | |||||
|
Name: | Xie Tao | ||||
|
Title: | Chief Executive Officer |
- 2 -
Aero-Biotech Science & Technology Co., Ltd. | ||||||
|
||||||
By: | /s/ Xie Tao | |||||
|
Name: | Xie Tao | ||||
|
Title: | Chief Executive Officer |
Shareholders Agreement |
|
|
|
||
Relating to Agria Asia Investments Limited |
|
|
|
||
Agria Group Limited ( Agria Group ) |
|
|
New Hope International (Hong Kong) Limited ( New Hope ) |
|
|
Agria Corporation |
|
Details
|
4 | |||
|
||||
Agreed terms
|
5 | |||
|
||||
1. Defined terms and interpretation
|
5 | |||
|
||||
1.1 Defined terms
|
5 | |||
1.2 Interpretation
|
6 | |||
1.3 Headings
|
6 | |||
|
||||
2. Commencement
|
7 | |||
|
||||
2.1 Commencement
|
7 | |||
|
||||
3. Rights of First Offer and Tag-along Right of New Hope
|
7 | |||
|
||||
3.1 Right of First Offer
|
7 | |||
3.2 Tag-Along Right
|
7 | |||
3.3 Permitted Transfers
|
8 | |||
|
||||
4. Put Option of New Hope
|
8 | |||
|
||||
4.1 Put Option
|
8 | |||
4.2 Repurchase Price
|
9 | |||
|
||||
5. Covenant
|
9 | |||
|
||||
5.1 Security Agreements
|
9 | |||
5.2 Further Action
|
10 | |||
5.3 Information
|
10 | |||
|
||||
6. Warranties
|
10 | |||
|
||||
6.1 Capacity and status
|
10 | |||
6.2 Information accuracy
|
10 | |||
6.3 Legal advice
|
11 | |||
6.4 Confidentiality obligations
|
11 | |||
6.5 Announcements
|
11 | |||
6.6 Exceptions
|
11 | |||
6.7 Survival
|
11 | |||
|
||||
7. Termination
|
12 | |||
|
||||
7.1 Automatic termination
|
12 | |||
7.2 Accrued rights
|
12 | |||
|
||||
8. Disputes
|
12 | |||
|
||||
9. Notices and other communications
|
13 | |||
|
||||
9.1 Service of notices
|
13 | |||
9.2 Effective on receipt
|
13 | |||
|
||||
10. Miscellaneous
|
14 | |||
|
||||
10.1 Alterations
|
14 | |||
10.2 Approvals and consents
|
14 | |||
10.3 Costs
|
14 | |||
10.4 Assignment
|
14 |
page 2
10.5 Survival
|
14 | |||
10.6 Counterparts and electronic copies
|
14 | |||
10.7 No merger
|
14 | |||
10.8 Entire agreement
|
14 | |||
10.9 Further action
|
14 | |||
10.10 Severability
|
14 | |||
10.11 Waiver
|
14 | |||
10.12 Relationship
|
15 | |||
10.13 Governing law and jurisdiction
|
15 | |||
10.14 Effectiveness
|
15 | |||
|
||||
Signing page
|
16 | |||
|
||||
Exhibit I First Pledge Agreement
|
17 |
page 3
Name
|
Agria Group Limited | |
Short name
|
Agria Group | |
Notice Details
|
21/F Tower B, PingAn International Finance Center, 1-3
Xinyuan South Road,
Chaoyang District, Beijing, China |
|
|
||
Fax
|
010-84381003 | |
Attention
|
John Layburn | |
|
||
Name
|
Agria Corporation | |
Short name
|
Agria Corporation | |
Notice Details
|
21/F Tower B, PingAn International Finance Center, 1-3
Xinyuan South Road,
Chaoyang District, Beijing, China |
|
|
||
Fax
|
010-84381003 | |
Attention
|
John Layburn | |
|
||
Name
|
New Hope International (Hong Kong) Limited | |
Short name
|
New Hope | |
Notice Details
|
Suite 2508, West Tower, LG Twin Tower, Jianguomenwai Avenue, Chaoyang District, Beijing, China | |
|
||
Fax
|
010-65676087 | |
Attention
|
Tianli Zhang |
A | Agria Group, a company incorporated under the laws of British Virgin Islands, is a wholly-owned subsidiary of Agria Corporation, a NYSE listed company incorporated under the laws of Cayman Islands. | |
B | New Hope is a company with limited liability incorporated under the laws of the Hong Kong Special Administrative Region of the PRC. | |
C | Agria Asia Investments Limited ( Company ), is a company incorporated under the laws of British Virgin Islands whose shareholders became Agria Group and New Hope pursuant to certain subscription agreements entered into between Agria Group, New Hope and the Company. | |
D | The Company is the sole shareholder of Agria (Singapore) Pte. Ltd. ( Subsidiary ) which holds 50.01% of the shares in PGG Wrightson Limited, a New Zealand public company with the largest rural services business in New Zealand ( PGW ). | |
E | New Hope intends to be a medium to long term holder of shares in the Company, unless changed circumstances cause New Hope to change its objectives, in which case the parties hereto will use their respective reasonably best efforts to agree upon a partial or full exit for New Hope. Agria and New Hope have entered into this agreement in connection with certain matters relating to their shareholdings in the Company unless there is any other agreement reached between Agria Group and New Hope. |
page 4
1. | Defined terms and interpretation | |
1.1 | Defined terms | |
In this agreement: | ||
Affiliate means, with respect to any person, any other person directly or indirectly Controlling, Controlled by, or under common Control with such person. | ||
Business Day means a day that is not a Saturday or Sunday, or a public holiday in any of Beijing, China, the City of New York, New York, USA and Auckland and Christchurch, New Zealand. | ||
Change in Control means any change in the largest beneficial owner (as such term is defined in Section 13 of the U.S. Securities Exchange Act of 1934) of the shares of Agria Corporation as of the date of this Agreement. | ||
Completion Date means 29 April 2011. | ||
Conditions means any required material third-party or governmental approvals, compliance with applicable laws and the absence of any injunction or similar legal order preventing such transaction. | ||
Confidential Information means any of the following which is not in the public domain: |
(a) | information concerning the contents of the Transaction Documents or any transaction undertaken under the Transaction Documents; |
(b) | all data bases, source codes, methodologies, manuals, artwork, advertising manuals, trade secrets and all financial, accounting, marketing and technical information, customer and supplier lists, know-how, technology, operating procedures and other information, used by or relating to the Company or the Subsidiary and its transactions and affairs; |
(c) | all notes and reports incorporating or derived from information referred to in paragraph (a) or (b); and |
(d) | all copies of the information, notes and reports referred to in paragraphs (a) to (c). |
page 5
1.2 | Interpretation | |
In this agreement, unless the context otherwise requires: |
(a) | the singular includes the plural and vice versa and a gender includes other genders; |
(b) | another grammatical form of a defined word or expression has a corresponding meaning; |
(c) | a reference to a clause, paragraph, schedule or annexure is to a clause in or paragraph of or schedule or annexure to this agreement and a reference to this agreement includes any schedule or annexure; |
(d) | a reference to a document or instrument, includes the document or instrument as novated, altered, supplemented or replaced from time to time; | ||
(e) | a reference to time is to New Zealand time; |
(f) | a reference to a party to this agreement, and a reference to a party to a document includes the partys executors, administrators, successors and permitted assigns and substitutes; |
(g) | a reference to a person includes a natural person, partnership, body corporate, association, governmental or local authority or agency or other entity; |
(h) | a reference to a statute, ordinance, code or other law includes regulations and other instruments under it and consolidations, amendments, re-enactments or replacements of any of them; |
(i) | the meaning of general words is not limited by specific examples introduced by including , for example or similar expressions; |
(j) | any agreement, representation, warranty or indemnity in favour of two or more parties (including where two or more persons are included in the same defined term) is for the benefit of them jointly and severally; |
(k) | a rule of construction does not apply to the disadvantage of a party because the party was responsible for the preparation of this agreement or any part of it; |
(l) | if a day on or by which an obligation must be performed or an event must occur is not a Business Day, the obligation must be performed or the event must occur on or by the next Business Day; and |
(m) | if a calculation relating to the issue or Transfer of Shares under this agreement results in a number that is, or includes, a fraction, the fraction is rounded down to the nearest whole number. |
1.3 | Headings |
page 6
2. | Commencement | |
2.1 | Commencement | |
This agreement shall commence on the date of this Agreement. | ||
3. | Rights of First Offer and Tag-along Right of New Hope | |
3.1 | Right of First Offer | |
3.1.1 | If Agria Corporation proposes to Transfer all or any part of its shares in Agria Group, other than to a Permitted Transferee (as defined below), Agria Corporation shall first give written notice (the ROFO Notice ) to New Hope stating its bona fide intention to Transfer such shares ( Relevant Shares ), including a description of any material terms, including the amount of the Relevant Shares and the price per share (the ROFO Price ), of such intended Transfer. The ROFO Notice shall constitute an irrevocable and binding written offer (the Offer ) to sell all, but not part, of the Relevant Shares at the ROFO Price and on the offer terms specified in the Offer. | |
3.1.2 | New Hope may accept the Offer by delivering an irrevocable written acceptance (an Acceptance ) to Agria Corporation within 15 days after the receipt of the ROFO Notice. Following any Acceptance, the closing of the purchase of the Relevant Shares and any Shares being sold pursuant to the exercise of a Tag-Along Right in accordance with Section 3.2 shall take place on the 90th day (unless such day is not a Business Day, in which case it will occur on the Business Day immediately after the 90th day) after the date of such Acceptance unless the parties agree on a different time, subject to the satisfaction of any Conditions, in which case, such closing shall be delayed pending satisfaction of such Conditions; provided, that if any Conditions remain unsatisfied as of the 120th day after the date of Acceptance (the Expiration Date ), New Hope shall be deemed to have not delivered such Acceptance and Section 3.1.3 shall apply. | |
3.1.3 | If New Hope does not deliver an Acceptance within 15 days after the receipt of the ROFO Notice, and otherwise in accordance with Section 3.1.2, Agria Corporation shall have the right, subject to Section 3.2, to sell the Relevant Shares to a third party at a price no less than the ROFO Price and at terms and conditions no less favourable to Agria Corporation than those terms and conditions stated in the ROFO Notice for a period of 270 days from the later of (x) the 15th day following the Offer Date and (y) the Expiration Date (the Sale Period ). If Agria Corporation does not Transfer the applicable Relevant Shares before the end of the Sale Period, Agria Corporation may not sell any Relevant Shares without complying with this Section 3.1. | |
3.1.4 | For the avoidance of doubt, Agria Corporations rights and obligations under this agreement shall only be with respect to this Section 3.1. | |
3.2 | Tag-Along Right | |
3.2.1 | Subject to compliance with Section 3.1, if Agria Group proposes to Transfer the shares in the Company to a person (the Purchaser ), other than (i) in accordance with Section 3.1, or (ii) to a Permitted Transferee as defined below (a Tag-Along Sale ), Agria Group shall give written notice (a Tag-Along Notice ) to New Hope at least 30 days prior to the consummation of such proposed Tag-Along Sale setting forth: |
(a) | the total number of Shares proposed to be Transferred to the Purchaser (the Tag-Along Offered Shares ) and the sale price per share; | ||
(b) | the identity of the Purchaser; | ||
(c) | any other material terms and conditions of the proposed Transfer; and | ||
(d) | the expected date of the proposed Transfer. |
page 7
3.2.2 | Upon delivery of a Tag-Along Notice, New Hope shall have the right, but not the obligation, to sell up to its Pro Rata Portion of the Tag-Along Offered Shares at the same price per share, for the same form of consideration and pursuant to the same terms and conditions as set forth in the Tag-Along Notice. If New Hope wishes to participate in the Tag-Along Sale, it shall provide irrevocable written notice to Agria Group no later than 20 days after the date of the Tag-Along Notice. Such notice shall (i) set forth the number of Shares that New Hope elects to include in the Tag-Along Sale, which number shall not exceed its Pro Rata Portion of the Tag-Along Offered Shares, and (ii) constitute New Hopes binding agreement to sell such Shares in the Tag-Along Sale on the terms and conditions applicable to the Tag-Along Sale. Agria Group shall not consummate the Tag-Along Sale unless the Purchaser purchases all of the Shares requested to be included in the Tag-Along Sale by New Hope on the same terms and conditions applicable to Agria Group; provided, that if the number of Shares which Agria Group and New Hope elect to sell in the Tag-Along Sale is more than the Tag-Along Offered Shares, to the extent that the Purchaser does not elect to purchase such excess shares, the number of shares to be sold by Agria Group and New Hope shall be reduced on a pro rata basis according to the proportion which the number of Shares that each of Agria Group and New Hope elects to have included in the Tag-Along Sale pursuant to this Section 3.2 bears to the total number of Shares elected by Agria Group and New Hope to have included in the Tag-Along Sale pursuant to this Section 3.2. |
3.2.3 | Agria Group shall have the right for a period of 120 days (which period may be extended to 180 days to satisfy any Conditions) after the expiration of the 20-day period referred to in Section 3.2.2 to Transfer the Tag-Along Offered Shares subject to the Tag-Along Notice (not otherwise sold by New Hope) to the Purchaser at a price not greater than the price contained in, and otherwise on terms and conditions not materially more favourable to Agria Group than those set forth in the Tag-Along Notice. After the end of the 120-day period referred to in this Section 3.2.3, Agria Group will not effect Transfer of any shares that are the subject of the Tag-Along Notice without commencing de novo the procedures set forth in this Section 3.2. |
3.2.4 | Pro Rata Portion means with respect to New Hope, in the case that Agria Group proposes to Transfer all or any portion of its Shares, such portion of Shares held by New Hope that represents the same percentage of the total number of Shares held by it as the total number of Shares proposed to be sold by Agria Group represents to the total number of Shares held by Agria Group. | |
3.3 | Permitted Transfers | |
Sections 3.1 and 3.2 do not apply to a Transfer to a company of which the ROFO Seller is the sole beneficial owner of the shares or to a wholly owned subsidiary of that company ( Permitted Transferee ). |
4. | Put Option of New Hope | |
4.1 | Put Option | |
4.1.1 | New Hope shall have the right to sell its Shares in the Company to Agria Group (the Put Option ) as follows: |
(a) | within 30 days after 12 months following the Completion Date, New Hope shall have the right to serve a prior written notice to Agria Group to sell up to 30% of the Shares in the Company initially subscribed by it to Agria Group; |
(b) | within 30 days after 24 months following the Completion Date, New Hope shall have the right to serve a prior written notice to Agria Group to sell up to 60% of the Shares in the Company less any Shares sold under Section 4.1.1 (a) that were initially subscribed by it to Agria Group; and |
(c) | within 30 days after 36 months following the Completion Date, New Hope shall have the right to serve a prior written notice to Agria Group to sell up to 100% of the Shares in the Company less the Shares sold under Section 4.1.1 (a) and Section 4.1.1 (b) that were initially subscribed by it to Agria Group. |
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4.1.2 | Within 45 days after the occurrence of any or all of the following events, which information shall be promptly communicated to New Hope by Agria Group within 5 days after such occurrence, New Hope shall have the right to serve a written notice to Agria Group to sell all of the Shares in the Company held by it: |
(a) | Agria Corporation has undergone a Change in Control; or |
(b) | Agria Corporation unilaterally terminates the service agreement (to be entered into and a copy forthwith after execution to be delivered to New Hope) between Mr. Xie Tao and Agria Corporation within three years following the Completion Date without cause. |
4.2 | Repurchase Price | |
The repurchase price ( Repurchase Price ) payable by Agria Group to New Hope upon exercise of the Put Option by New Hope shall be a price to be agreed upon in writing by Agria Group and New Hope. | ||
5. | Covenant | |
5.1 | Security Agreements | |
5.1.1 | Agria Group shall: |
(a) | execute and deliver the First Pledge Agreement upon the signing of this Agreement; and |
(b) | cause Mr. Guanglin Lai to execute and deliver the Personal Guaranty in a form to be agreed between New Hope and Agria Group upon the signing of this Agreement |
5.1.2 | In the event that the Subsidiary executes and delivers the Second Pledge Agreement to New Hope, the parties agree that the First Pledge Agreement and the Personal Guaranty shall be terminated and the relevant parties thereunder shall be released and discharged from any and all obligations and liabilities with respect to the First Pledge Agreement and the Personal Guaranty. |
5.1.3 | The Security Agreements will terminate if the Put Options have been exercised by New Hope to the fullest extent and Agria Group has paid to New Hope all of the considerations in connection with the Put Options as determined by Section 4.2. |
5.1.4 | The Security Agreement will terminate if New Hope does not exercise the Put Options within 30 days after 36 months following the Completion. |
5.1.5 | The Security Agreement will also terminate if New Hope does not exercise the Put Options within 45 days after the occurrence of all of the events set forth in Section 4.1.2 (a) (b), which information shall be promptly communicated to New Hope by Agria Group within 5 days after such occurrence. |
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5.2 | Further Action |
5.3 | Information |
6. | Warranties |
6.1 | Capacity and status |
(a) | it is validly existing under the laws of its place of incorporation; |
(b) | it has the power to enter into and perform its obligations under this agreement and to carry out the transactions contemplated by this agreement; |
(c) | it has taken all necessary action to authorise its entry into and performance of this agreement and to carry out the transactions contemplated by this agreement; and |
(d) | its obligations under this agreement are valid and binding and enforceable against it in accordance with their terms. |
6.2 | Information accuracy |
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6.3 | Legal advice |
6.4 | Confidentiality obligations |
(a) | use the Confidential Information only to make decisions regarding their investment in the Group, and |
(b) | keep that Confidential Information confidential and not disclose it or allow it to be disclosed to any third party except, and in all cases subject to any obligations under any applicable laws or regulations: |
(i) | with the prior written approval of the other party; or |
(ii) | to officers, employees and consultants or advisers of the parties (or their Related Companies) who have a need to know (and only to the extent that each has a need to know) and are aware that the Confidential Information must be kept confidential, |
6.5 | Announcements |
6.6 | Exceptions |
(a) | is disclosed to a party, but at the time of disclosure is rightfully known to or in the possession or control of the party and not subject to an obligation of confidentiality on the party; |
(b) | is public knowledge (except because of a breach of this agreement or any other obligation of confidence); |
(c) | is required to be disclosed by law or order of any court, tribunal, authority or regulatory body or in connection with the enforcement of this agreement or by the rules of a stock exchange, in which case the disclosing party shall discuss with the other party within a reasonable period before the disclosure and make reasonable efforts to seek confidential treatment as reasonably requested by the other party to the extent practicable. |
6.7 | Survival |
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7. | Termination | |
7.1 | Automatic termination |
(a) | if all parties agree; |
(b) | for any party, when it stops holding, directly or indirectly, any Shares, at which time the Shareholder has no further rights or obligations under this agreement; | ||
(c) | when the Company is liquidated; or | ||
(d) | on the day on which an agreement to sell all the Shares is completed. |
7.2 | Accrued rights |
8. | Disputes |
(a) | The parties agree to negotiate in good faith to resolve any dispute among them regarding this Agreement. If the negotiations do not resolve the dispute to the reasonable satisfaction of all Parties to the dispute within thirty (30) days of notification of the dispute in writing by one party delivered to the other Party, the dispute shall be referred to arbitration under Section 8(b). |
(b) | The arbitration shall be conducted in Hong Kong under the auspices of the Hong Kong International Arbitration Centre (the HKIAC ). There shall be three arbitrators. The complainant and the respondent to such dispute shall each select one arbitrator within thirty (30) days after giving or receiving the demand for arbitration. Such arbitrators shall be freely selected, and the parties hereto shall not be limited in their selection to any prescribed list. The Chairman of the HKIAC shall select the third arbitrator. If either Party to the arbitration does not appoint an arbitrator who has consented to participate within the said thirty (30) day period, the relevant appointment shall be made by the Chairman of the HKIAC. |
(c) | The arbitration proceedings shall be conducted in English. The arbitration tribunal shall apply the Arbitration Rules of the HKIAC in effect at the time of the arbitration. However, if such rules are in conflict with the provisions of this Section 8, including the provisions concerning the appointment of arbitrators, the provisions of this Section 8 shall prevail. |
(d) | Each party shall cooperate with any party to the dispute in making full disclosure of and providing complete access to all information and documents requested by such party in connection with such arbitration proceedings, subject only to any confidentiality obligations binding on the party receiving the request. |
(e) | The award of the arbitration tribunal shall be final and binding upon and the exclusive remedy of the disputing parties, and any party to the dispute may apply to a court of competent jurisdiction for enforcement of such award. |
(f) | Any party to the dispute shall be entitled to seek preliminary injunctive relief, if possible, from any court of competent jurisdiction pending the constitution of the arbitral tribunal. |
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9. | Notices and other communications | |
9.1 | Service of notices |
(a) | in writing, in English and signed by a person duly authorised by the sender; and |
(b) | hand delivered or sent by prepaid post or facsimile or e mail to the recipients address for Notices, as varied by any Notice given by the recipient to the sender. |
9.2 | Effective on receipt |
(a) | if hand delivered, on delivery; |
(b) | if sent by prepaid post, on the second Business Day after the date of posting to an address within the country in which the notice was sent (or on the seventh Business Day after the date of posting if posted to a place outside the country from which the notice was sent); |
(c) | if sent by facsimile, on the date and time shown on the transmission report by the machine from which the facsimile was sent which indicates that the facsimile was sent in its entirety and in legible form to the facsimile number of the addressee notified for the purposes of this clause; or |
(d) | if sent by email, on the date and time at which it enters the addressees information system (as shown in a confirmation of delivery report from the senders information system, which indicates that email was sent to the email address of the addressee notified for the purposes of this clause), |
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10. | Miscellaneous | |
10.1 | Alterations |
10.2 | Approvals and consents |
10.3 | Costs | |
All costs and expenses (including, without limitation, fees and disbursements of counsel, financial advisers and accountants) incurred in connection with this agreement and the transactions contemplated hereby shall be paid by each party. | ||
10.4 | Assignment |
(a) | Subject to clause 10.4(b), a party may only assign this agreement or a right under this agreement with the prior written consent of each other party. | ||
(b) | A party hereto may assign its rights under this agreement to a person to whom it sells all of its Shares in accordance with, and subject to, this agreement. |
10.5 | Survival | |
Any indemnity or obligation of confidentiality under this agreement is independent from the other obligations of the parties and survives termination of this agreement. Any other term which by its nature is intended to survive termination of this agreement survives termination of this agreement. | ||
10.6 | Counterparts and electronic copies | |
This agreement may be executed in counterparts. All executed counterparts constitute one document. This agreement may be executed on the basis of an exchange of facsimile, scanned or other electronic copies and execution of this agreement by such means is to be a valid and sufficient execution. | ||
10.7 | No merger | |
The rights and obligations of the parties under this agreement do not merge on completion of any transaction contemplated by this agreement. | ||
10.8 | Entire agreement | |
This agreement, together with the other Transaction Documents, constitutes the entire agreement between the parties in connection with its subject matter and supersedes all previous agreements or understandings between the parties in connection with its subject matter. | ||
10.9 | Further action | |
Each party must do, at its own expense, everything reasonably necessary (including executing documents) to give full effect to this agreement and any transaction contemplated by it. | ||
10.10 | Severability | |
A term or part of a term of this agreement that is illegal or unenforceable may be severed from this agreement and the remaining terms or parts of the term of this agreement continue in force. | ||
10.11 | Waiver | |
A party does not waive a right, power or remedy if it fails to exercise or delays in exercising the right, power or remedy. A single or partial exercise by a party of a right, power or remedy does not prevent another or further exercise of that or another right, power or remedy. A waiver of a right, power or remedy must be in writing and signed by the party giving the waiver. |
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10.12 | Relationship | |
Except where this agreement expressly states otherwise, this agreement does not create a relationship of employment, trust, agency or partnership between the parties. | ||
10.13 | Governing law and jurisdiction | |
This agreement is governed by the laws of the Hong Kong Special Administrative Region of the Peoples Republic of China ( Hong Kong ) and each party irrevocably and unconditionally submits to the exclusive jurisdiction of the courts of Hong Kong. | ||
10.14 | Effectiveness | |
The effectiveness of this Agreement is subject to the transaction contemplated in the Transaction Documents being approved by relevant authorities in China. To the extent that any provision or term of this agreement requires approval under any law of New Zealand or the NZX Listing Rules, such provision or term will not take effect until or unless such approval is obtained or waived and the terms of any such approval complied with. |
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SIGNED
by
AGRIA GROUP LIMITED
by its
duly authorised signatory: |
/s/ Lai Guanglin
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Lai Guanglin | |||
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|
Name of authorised signatory | |||
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SIGNED
by
AGRIA CORPORATION
by its duly
|
/s/ Xie Tao | |||
|
||||
authorised signatory, only with respect
to Section 3.1 hereof:
|
Signature of authorised signatory | |||
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||||
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Xie Tao | |||
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||||
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Name of authorised signatory | |||
|
||||
SIGNED
by
NEW HOPE INTERNATIONAL
|
/s/ [Illegible] | |||
|
||||
(HONG KONG) LIMITED
by its duly
authorised signatory: |
Signature of authorised signatory | |||
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||||
|
||||
|
Name of authorised signatory |
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(1) | Agria Group Limited , a company incorporated under the laws of the British Virgin Islands (the Chargor ); and |
(2) | New Hope International (Hong Kong) Limited , a company incorporated under the laws of Hong Kong ( Chargee ); |
(3) | Whereas: |
(A) | The Chargor, the Chargee and Agria Asia Investments Limited entered into a subscription agreement ( Subscription Agreement ) dated 14 April 2011 and a related shareholder agreement ( Shareholder Agreement ) dated 28 June 2011 in respect of the subscription of the shares in Agria Asia Investment Limited on 29 April 2011. It is a condition under the Shareholder Agreement that the Chargor shall enter into this share charge in relation to the issued share capital of the Charged Company (as defined below). |
(B) | The Chargee shall hold the benefit of this Charge for itself and on trust for the holders of the Notes. |
1 | Definitions and Interpretation |
1.1 | In this Charge (except where the context otherwise requires) words and expressions shall have the same meanings assigned to them as defined in the Subscription Agreement and the Shareholder Agreement and the following words and expressions shall have the following meanings: |
BCA
|
means the BVI Business Companies Act, 2004 (as amended); | |
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Business Day
|
means, in the case of delivery of a notice, any day which is not a Saturday or Sunday or public holiday in the place at which the notice is left or sent, and in any other case, any day which is not a Saturday or Sunday or a public holiday in the British Virgin Islands; | |
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Charge
|
means this share charge to be entered into between the Chargor and the Chargee; |
Charged Shares
|
means the Initial Shares and all and any other shares, warrants and other securities of any kind (including loan capital) of the Charged Company now or at any time in the future legally and/or beneficially owned by the Chargor or in which the Chargor has any interest and all rights, benefits and advantages now or at any time in the future deriving from or incidental to any of the Charged Shares, including, without limitation: |
(a) | all dividends, interest and other income paid or payable in relation to any Charged Shares; and | ||
(b) | all shares, securities, rights, monies or other property accruing, offered or issued at any time by way of redemption, conversion, exchange, substitution, preference, option or otherwise in respect of any Charged Shares (including but not limited to proceeds of sale); |
|
Charged Shares shall exclude any shares of the Charged Company that may be sold to Ngai Tahu Holdings Corporation Limited (Ngai Tahu) by the Chargor pursuant to a conditional share purchase agreement between Ngai Tahu and the Chargor dated 15 April 2011. | |
|
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Charged Company
|
means the company set forth in Column C of Schedule 1 in this Charge; | |
|
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Company
|
means Agria Asia Investment Limited, a company incorporated in the British Virgin Islands of PO Box 957, Road Town, Tortola, British Virgin Islands; | |
|
||
Enforcement Notice
|
means an enforcement notice served by the Chargee on the Chargor; | |
|
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Initial Shares
|
means the shares listed in Schedule 1, which are registered at the date of this Charge in the name of the Chargor; | |
|
||
Insolvency Act
|
means the BVI Insolvency Act, 2003 (as amended); | |
|
||
Receiver
|
means as defined in Clause 8; | |
|
||
Register of Members
|
means the register of members held at the Charged Companys registered office, containing the names and addressed of the persons who hold shares in the Charged Company, the number of each class and series of shares held by each member, the date on which the name of each member was entered in the register of members, and the date on which any eligible person ceased to be a member of the Charged Company; |
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Registry
|
means the Registry of Corporate Affairs in the British Virgin Islands; | |
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Secured Obligations
|
means all and any amounts of any kind, now or in the future, actual or contingent, due or payable (or expressed to be due or payable) by the Chargor to the Chargee in any currency, actually or contingently, solely and/or jointly and/or severally with another or others as principal or surety on any account whatsoever under or in connection with the Put Option defined and contemplated in the Shareholder Agreement; | |
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Security Interest
|
means any mortgage, charge, pledge, lien, encumbrance, right of set off or any security interest, howsoever created or arising; and | |
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Shareholder
Agreement
|
means a shareholder agreement entered into by and between Chargor, Chargee and the Agria Corporation dated 28 June 2011, containing, among other matters, the Put Option as defined in the Shareholder Agreement. | |
|
||
Subscription
Agreement
|
means a subscription agreement entered into bv and between Chargor, Chargee, the Company in connection with the subscription of shares in the Company on 29 April 2011 (as may be amended from time to time); | |
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Termination Event
|
means any breach of, or a termination event, or default or event of default under the Shareholder Agreement by the Company or this Charge by the Chargor that is either incapable of remedy or if capable of remedy has been continuing for 7 Business Days following notification by the Chargee. |
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1.2 | In this Charge: |
(a) | any reference to a Recital, Clause or Schedule is to the relevant Recital, Clause or Schedule of or to this Charge and any reference to a Sub-Clause or paragraph is to the relevant Sub-Clause or paragraph of the Clause or Schedule in which it appears; | ||
(b) | the clause headings are included for convenience only and shall not affect the interpretation of this Charge; | ||
(c) | use of the singular includes the plural and vice versa ; | ||
(d) | use of any gender includes the other genders; | ||
(e) | any phrase introduced by the terms including, include, in particular or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms; and | ||
(f) | references to any document or agreement are to be construed as references to such document or agreement as is in force for the time being and as amended, varied supplemented, substituted or novated from time to time. |
1.3 | The Recitals and Schedules form part of this Charge and shall have effect as if set out in full in the body of this Charge and any reference to this Charge includes the Recitals and Schedules. |
1.4 | The obligations of each person (if more than one person) constituting the Chargor under this Charge are joint and several. |
1.5 | In the event of any conflict between the provisions of this Charge and the Shareholder Agreement, the provisions of the Shareholder Agreement shall prevail. |
2 | Covenant to Pay |
3 | Charge |
3.1 | The Chargor, with full title guarantee, hereby charges by way of first fixed charge as a continuing security for the payment and discharge of the Secured Obligations, all its right, title, interest and benefit present and future in, to and under the Charged Shares subject to the provisions for release of this Charge set out below. |
3.2 | Unless and until a Termination Event has occurred: |
(a) | the Chargor shall be entitled to exercise all voting rights attaching to the Charged Shares or any thereof for all purposes not inconsistent with the purposes of this Charge, any of the Secured Obligations or of the Shareholder Agreement; and |
(b) | the Chargor shall be entitled to receive and retain any and all dividends and other distributions paid in respect of the Charged Shares or any thereof. |
4
3.3 | Subject to Clauses 3.4 and 3.5, on the irrevocable and unconditional payment or discharge by or on behalf of the Chargor of the Secured Obligations in full, the Chargee shall, at the request and cost of the Chargor, release this Charge. |
3.4 | Any receipt, release or discharge of any security created by this Charge or of any liability arising under this Charge may only be given by the Chargee in accordance with the provisions on this Charge and shall not release or discharge the Chargor from any liability to the Chargee for the same or any other monies which may exist independently of this Charge. Where such receipt, release or discharge relates to only part of the Secured Obligations such receipt, release or discharge shall not prejudice or affect any other part thereof nor any of the rights and remedies of the Chargee hereunder or under any other agreement nor any of the obligations of the Chargor under this Charge or any other agreement. |
3.5 | Any release, discharge or settlement between the Chargor and the Chargee shall be conditional upon no security, disposition or payment to the Chargee or any other person being void, set aside or ordered to be refunded pursuant to any enactment or law relating to liquidation, administration or insolvency or for any other reason whatsoever and if such condition is not fulfilled the Chargee shall be entitled to enforce this Charge as if such release, discharge or settlement had not occurred and any such payment had not been made. |
3.6 | The restriction on the consolidation of mortgages and on power of sale imposed by sections 35 and 40 respectively of the Conveyancing and Law of Property Act 1961 (as amended) (the CPA Act ) shall not apply to the security constituted by this Charge. |
4 | Covenants by the Chargor |
4.1 | it shall deliver to the Chargee the following (on the date hereof) in form and substance acceptable to the Chargee as security in accordance with the terms of this Charge: |
(a) | the original share certificates in respect of the Initial Shares; |
(b) | blank, signed and undated transfers in respect of the Initial Shares in the form set out in Schedule 2; |
4.2 | it shall deliver to the Chargee the following (within 10 Business Days from the date hereof), a certified true copy of the Chargors register of charges, duly stamped and filed at the Registry, showing details of this Charge; |
4.3 | it shall promptly pay (and shall indemnify the Chargee on demand against) all calls, instalments and other payments which may be made or become due in respect of the Charged Shares and so that, in the event of default by the Chargor, the Chargee may do so on behalf of the Chargor; |
5
4.4 | it shall not, except with the prior written consent of the Chargee: |
(a) | create or permit to exist over all or part of the Charged Shares (or any interest therein) any Security Interest (other than created or expressly permitted to be created under this Charge) whether ranking prior to, pari passu with or behind the security contained in this Charge; or |
(b) | sell, transfer or otherwise dispose of the Charged Shares or any interest therein or attempt or agree to so dispose (other than in accordance with this Charge); or |
(c) | permit any person other than the Chargor or the Chargee or the Chargees nominee or nominees to be registered as, or become the holder of, the Charged Shares; or |
(d) | vote in favour of a resolution to amend, modify or change the memorandum and articles of association of the Charged Company or to continue the Charged Company in a jurisdiction outside the British Virgin Islands; or |
(e) | to the extent that the same is within the control of the Chargor, allow or consent to any further shares in the Charged Company being issued to any person other than the Chargor (and for the avoidance of doubt any such shares issued to the Chargor will form part of the Charged Shares in accordance with this Charge); |
4.5 | it shall promptly forward to the Chargee all material notices, reports, accounts and other documents relating to the Charged Shares which it may receive from time to time (including all notices of meetings of the shareholders of the Charged Company); |
4.6 | at any time after the occurrence of a Termination Event it shall exercise all voting and other rights and powers which may at any time be exercisable by the holder of the Charged Shares as the Chargee may in its absolute discretion direct; |
4.7 | it shall not take or accept any Security Interest from the Charged Company or, in relation to the Secured Obligations, from any third party, without the Chargees prior written consent; |
4.8 | unless directed in writing to do so by the Chargee it shall not prove in a liquidation or winding up of the Charged Company until all the Secured Obligations are paid in full and if directed to prove by the Chargee (or if the Chargor otherwise receives any payment or other benefit in breach of this Clause or Clause 4.9) the Chargor shall hold all monies received by it on trust for the Chargee to satisfy the Secured Obligations; and |
4.9 | until all of the Secured Obligations have been paid in full, it shall not claim payment whether directly or by set-off, lien, counterclaim or otherwise of any amount which may be or has become due to the Chargor by the Charged Company other than as contemplated and/or expressly permitted by the Shareholder Agreement. |
6
5 | Representations and Warranties by the Chargor |
5.1 | the Chargor is the absolute sole legal and beneficial owner of all of the Initial Shares free of all Security Interests, trusts, equities and third party claims whatsoever (save those under this Charge) and that all of the Initial Shares are fully paid up; |
5.2 | the Initial Shares represent 80.81% of the shares issued by the Charged Company; |
5.3 | the Initial Shares are freely transferable on the books of the Charged Company and no consents or approvals are required in order to register a transfer of the Initial Shares; |
5.4 | no litigation against the Chargor or the Charged Company is current or, to their knowledge pending or threatened; |
5.5 | it is duly incorporated and in good standing under the laws of the jurisdiction in which it is incorporated and has and will at all times have the necessary power to enter into and perform its obligations under this Charge and has duly authorised the execution and delivery of this Charge and the performance of its obligations hereunder; |
5.6 | this Charge constitutes its legal, valid, binding and enforceable obligation and is a first priority security interest over the Charged Shares effective in accordance with its terms; |
5.7 | the execution, delivery, observance and performance by the Chargor of this Charge will not require the Chargor to obtain any licences, consents or approvals and will not result in any violation of any law, statute, ordinance, rule or regulation applicable to it; |
5.8 | it is not necessary to file details of this Charge anywhere in the world, save as set out in sections 162 and 163 of the BCA; |
5.9 | it has obtained all the necessary authorisations and consents to enable it to enter into this Charge and the necessary authorisations and consents will remain in full force and effect at all times during the subsistence of the security constituted by this Charge; |
5.10 | the execution, delivery, observance and performance by the Chargor of the Charge will not constitute an event of default or trigger any enforcement under any Security Interest in the Chargors assets nor will it result in the creation of any Security Interest over or in respect of the present or future assets of the Charged Company; |
5.11 | the execution, enforcement or payments made under this Charge will not be subject to any taxes, fees or charges (including stamp duty) in the British Virgin Islands; and |
5.12 | it will procure that details of the Charged Shares shall be entered into the register of members of the relevant Charged Company. |
6 | Power of Attorney |
7
7 | Enforcement |
7.1 | The percentage of the Companys shares that may be enforceable under this charge shall be equal to the Repurchase Price (as defined in the Shareholders Agreement) as a percentage of the fair value of the Companys equity. |
7.2 | After this Charge has become enforceable, in accordance with Clause 7.3, the Chargee may in its absolute discretion enforce all or any part of this Charge in any manner it sees fit. For the avoidance of doubt, the Chargees rights of enforcement shall include (without limitation) the right: |
(a) | to perfect or improve its title to and security over the Charged Shares in such manner as the Chargee may in its absolute discretion determine; |
(b) | with notice to, or upon consent or concurrence by, the Chargor to sell the Charged Shares or any part thereof by such method, at such place and upon such terms as the Chargee may in its absolute discretion determine, with power to postpone any such sale and in any such case the Chargee may exercise any and all rights attaching to the Charged Shares as the Chargee in its absolute discretion may determine and without being answerable for any loss occasioned by such sale or resulting from postponement thereof or the exercise of such rights; |
(c) | to receive and retain all dividends and other distributions made on or in respect of the Charged Shares or any thereof and any such dividends and other distributions received by the Chargor after such time shall be held in trust by the Chargor for the Chargee and be paid or transferred to the Chargee on demand to be applied towards the discharge of the Secured Obligations; |
(d) | to exercise (or enable its nominees to exercise) any and all powers, discretion, voting or other rights or entitlements conferred on a holder of the Charged Shares in such manner as the Chargee may in its absolute discretion determine; |
(e) | to exercise any and all other rights, powers and discretions of the Chargor in respect of the Charged Shares in such manner as the Chargee may in its absolute discretion determine; |
(f) | to procure that the Chargee or its nominee or nominees is registered in the Register of Members of the Charged Company as holder of the legal title in and to the Charged Shares; |
(g) | otherwise to enforce any of the rights of the Chargee under or in connection with this Charge in such manner as the Chargee may in its absolute discretion determine; and |
(h) | to date and deliver the documents delivered to it pursuant to this Charge as it considers appropriate and to take all steps to register the Charged Shares in the name of the Chargee or its nominee or nominees and to assume control as the registered owner of the Charged Shares. |
8
7.3 | Subject to Clause 7.4 below, the Chargees rights of enforcement in relation to this Charge (other than those listed in section 66(5) of the BCA) shall become immediately enforceable upon the occurrence of a Termination Event. |
7.4 | For the purposes of section 66(7) of the BCA, notwithstanding any other provision of this Charge, the Chargee may enforce all rights of enforcement set out in section 66(5) of the BCA immediately upon the occurrence of a Termination Event that has been continuing for one day and which remains unrectified for a period of not less than one Business Day following notice given by the Chargee to the Chargor instructing the Chargor to immediately rectify such Termination Event (an Unrectified Termination Event ). |
7.5 | Neither the Chargee nor any Receiver (as defined in Clause 8 below) will be liable, by reason of entering into possession of a Charged Share, to account as mortgagee in possession or for any loss on realisation or for any default or omission for which a mortgagee in possession might be liable. |
8 | Receiver |
8.1 | Without prejudice to the provisions of Clause 7 above, upon the service of an Enforcement Notice the Chargee shall immediately become entitled to appoint one or more person or persons eligible to be appointed as a receiver under the Insolvency Act as the Chargee thinks fit to be a receiver (the Receiver ) in relation to the Charged Shares. Where the Chargee appoints two or more persons as Receiver, the Receivers may act jointly or independently. |
8.2 | The Receiver may take such action in relation to the enforcement of this Charge including, without limitation, to sell, charge or otherwise dispose of the Charged Shares, to exercise any powers, discretion, voting or other rights or entitlements in relation to the Charged Shares and generally to carry out any other action which he may in his sole discretion deem necessary in relation to the enforcement of this Charge. |
8.3 | To the fullest extent permissible under law, the Chargee may exercise any right or power that the Receiver may exercise in relation to the enforcement of this Charge. |
8.4 | The Receiver shall have, in addition to the other powers set out in this Clause, the following powers: |
(a) | power to take possession of, collect and get in the Charged Shares and, for that purpose, to take such proceedings as may seem to him to be expedient; |
(b) | power to raise or borrow money and grant security over the Charged Shares; |
(c) | power to appoint an attorney or accountant or other professionally qualified person to assist him in the performance of his functions; |
(d) | power to bring or defend any action or other legal proceedings in the name of and on behalf of the Chargor in respect of the Charged Shares; |
9
(e) | power to do all acts and execute in the name and on behalf of the Chargor any document or deed in respect of the Charged Shares; |
(f) | power to make any payment which is necessary or incidental to the performance of his functions; |
(g) | power to make any arrangement or compromise on behalf of the Chargor in respect of the Charged Shares; |
(h) | power to rank and claim in the insolvency or liquidation of the Charged Company and to receive dividends and to accede to agreements for the creditors of the Charged Company; |
(i) | power to present or defend a petition for the winding up of the Charged Company; and |
(j) | power to do all other things incidental to the exercise of the foregoing powers. |
8.5 | The Receiver shall be the agent of the Chargor and the Chargor alone shall be responsible for his acts and defaults and liable on any contracts made, entered into or adopted by the Receiver. The Chargee shall not be liable for the Receivers acts, omissions, negligence or default, nor be liable on contracts entered into or adopted by the Receiver. |
9 | Application of Monies |
9.1 | The Chargee (and any Receiver) shall apply the monies received by it as a result of the enforcement of the security: |
(a) | first, in payment or satisfaction of the expenses related to enforcement of this security (including without limitation the fees and expenses of the Receiver); |
(b) | secondly, in meeting claims of the Chargee in respect of the Secured Obligations; and | ||
(c) | thirdly, in payment of the balance (if any) to the Chargor. |
9.2 | The Chargee shall not be liable for any loss or damage: |
(a) | occasioned by any sale or disposal of the Charged Shares or an interest in the Charged Shares; or |
(b) | arising out of the exercise, or failure to exercise, any of its powers under this Charge; or |
(c) | occasioned by any neglect or default to pay any instalment or accept any offer or notify the Chargor of any such neglect or default; or |
(d) | occasioned by any other loss of whatever nature in connection with the Charged Shares. |
10 | Protection of Purchasers |
10
11 | Continuing Security and Non-Merger |
12 | Currency |
12.1 | For the purpose of, or pending the discharge of, any of the Secured Obligations the Chargee may, in its sole discretion, convert any moneys received or recovered in any currency under this Charge (including the proceeds of any previous conversion under this Clause) from their existing currency of denomination into any other currency at such rate or rates of exchange and at such time as the Chargee thinks fit. |
12.2 | No payment to the Chargee (whether under any judgment or court order or otherwise) shall discharge the Secured Obligations in respect of which it was made unless and until the Chargee shall have received payment in full in the currency in which such Secured Obligations were incurred and, to the extent that the amount of any such payment shall on actual conversion into such currency fall short of such Secured Obligations expressed in that currency, the Chargee shall have a further separate cause of action against the Chargor and shall be entitled to enforce this Charge to recover the amount of the shortfall. |
13 | Costs |
14 | Variation and Amendment |
15 | Assignment |
15.1 | The Chargor may not assign or transfer all or any part of its rights, benefits or obligations under this Charge to any other person without the prior written consent of the Chargee. |
15.2 | The Chargee may not assign or otherwise transfer the whole or any part of the rights, benefits and obligations under the Charge to any other person without the prior written consent of the Chargor. |
16 | Entire Agreement |
11
17 | Further Assurance |
17.1 | The Chargor shall promptly execute all documents and do all things that the Chargee may specify for the purpose of: |
(a) | securing and perfecting its security over or title to all or any of the Charged Shares; or |
(b) | enabling the Chargee to vest all or part of the Charged Shares in its name or in the names of its nominee(s), agent or any purchaser. |
18 | Notices |
18.1 | Without prejudice to any other method of service of notices and communications provided by law, a demand or notice under this Charge shall be in writing signed by an officer or agent of the Chargee or the Chargor, as the case may be, and may be served on the Chargor or the Chargee, as the case may be, by hand, by post, or by facsimile transmission. Any such notice or communication shall be sent to the address or number of the relevant party as set out below: |
18.2 | Any such notice or communication given by the Chargee shall be deemed to have been received: |
(a) | if sent by facsimile transmission, at the time of transmission, or the following Business Day if transmitted after normal business hours; |
(b) | if delivered personally (including being sent by courier), at the time of delivery, or the following Business Day if delivered after normal business hours; and |
(c) | if posted, on the fifth Business Day following the day on which it was properly despatched by courier. |
12
18.3 | Any notice given by the Chargor shall be deemed to have been given only on actual receipt by the Chargee. |
18.4 | In proving such service it shall be sufficient to prove that the envelope containing such notice was addressed to the address of the relevant party set out in Clause 18.1 (or as otherwise notified by that party hereunder) and delivered either to that address or into the custody of the postal authorities as a pre-paid recorded delivery, registered post or airmail letter, or that the notice was transmitted by fax to the fax number of the relevant party set out in Clause 18.1 (or as otherwise notified by that party hereunder). |
18.5 | For the avoidance of doubt, notice given under this Charge shall not be validly served if sent by e-mail. |
19 | Miscellaneous |
19.1 | All sums payable by the Chargor under this Charge shall be paid without any set-off, counterclaim, withholding or deduction whatsoever unless required by law in which event the Chargor will simultaneously with making the relevant payment under this Charge pay to the Chargee such additional amount as will result in the receipt by the Chargee of the full amount which would otherwise have been receivable and will supply the Chargee promptly with evidence satisfactory to the Chargee that the Chargor has accounted to the relevant authority for the sum withheld or deducted. |
19.2 | No delay or omission on the part of the Chargee in exercising any right or remedy under this Charge shall impair that right or remedy or operate as or be taken to be a waiver of it nor shall any single, partial or defective exercise of any such right or remedy preclude any other or further exercise under this Charge of that or any other right or remedy. |
19.3 | The Chargees rights powers and remedies under this Charge are cumulative and are not, nor are they to be construed as, exclusive of any rights, powers or remedies provided by law or otherwise and may be exercised from time to time and as often as the Chargee deems expedient. |
19.4 | Any waiver by the Chargee of any terms of this Charge or any consent or approval given by the Chargee under it shall be effective only if given in writing and then only for the purpose and upon the terms and conditions (if any) on which it is given. |
19.5 | If at any time any one or more of the provisions of this Charge is or becomes illegal, invalid or unenforceable in any respect under any law of any jurisdiction neither the legality, validity or enforceability of the remaining provisions of this Charge nor the legality, validity or enforceability of such provision under the law of any other jurisdiction shall be in any way affected or impaired as a result. |
19.6 | Any statement, certificate or determination of the Chargee as to the Secured Obligations or (without limitation) any other matter provided for in this Charge shall, in the absence of manifest error, be conclusive and binding on the Chargor. |
19.7 | The Chargor shall at all times maintain an agent for service of process in the British Virgin Islands. Such agent shall be ____ of _____ and any writ, judgment or other notice of legal process shall be sufficiently served on the Chargor if delivered to such agent at its address set out above. The Chargor undertakes not to revoke the authority of the above agent and if, for any reason, such agent no longer serves as agent of the Chargor to receive service of process the Chargor shall promptly appoint another such agent and advise the Chargee of the new agents name and address for service. |
13
20 | Law and Jurisdiction |
20.1 | This Charge is governed by, and shall be construed in accordance with, the laws of the British Virgin Islands. |
20.2 | The Chargor irrevocably agree for the exclusive benefit of the Chargee that the courts of the British Virgin Islands shall have jurisdiction to hear and determine any suit, action or proceeding and to settle any dispute which may arise out of or in connection with this Charge and for such purposes irrevocably submits to the jurisdiction of such courts. |
21 | Counterparts |
14
|
||||
Title: Director
|
||||
In the presence of:
|
||||
|
||||
|
||||
Title:
|
||||
|
||||
EXECUTED AS A DEED for and on behalf of New Hope International (Hong Kong) Limited as Charge e | ||||
|
||||
|
||||
Title: Director
|
||||
In the presence of:
|
||||
|
||||
|
||||
Title:
|
15
Column A
Column B
Column C
Column D
Column E
Place of
incorporation
Place of
of Charged
Charged
incorporation
No. of
Chargor
Company
Company
of Chargor
shares
British Virgin Islands
Agria Asia Investment Limited
British Virgin Islands
84,078,522
17
(1) |
Agria Group Limited
, a company incorporated under the laws of the British Virgin Islands (the
Chargor
); and
|
(2) |
New Hope International (Hong Kong) Limited
, a company incorporated under the laws of Hong
Kong (
Chargee
);
|
(A) |
The Chargor, the Chargee and Agria Asia Investments Limited entered into a subscription
agreement (
Subscription Agreement
) dated 14 April 2011 and a related shareholder agreement
(
Shareholder Agreement
) dated 28 June 2011 in respect of the subscription of the shares in
Agria Asia Investment Limited on 29 April 2011. It is a condition under the Shareholder
Agreement that the Chargor shall enter into this share charge in relation to the issued share
capital of the Charged Company (as defined below).
|
(B) |
The Chargee shall hold the benefit of this Charge for itself and on trust for the holders of
the Notes.
|
1 |
Definitions and Interpretation
|
1.1 |
In this Charge (except where the context otherwise requires) words and expressions shall have
the same meanings assigned to them as defined in the Subscription Agreement and the
Shareholder Agreement and the following words and expressions shall have the following
meanings:
|
BCA
|
means the BVI Business Companies Act, 2004 (as amended); | |
|
||
Business Day
|
means, in the case of delivery of a notice, any day which is not a Saturday or Sunday or public holiday in the place at which the notice is left or sent, and in any other case, any day which is not a Saturday or Sunday or a public holiday in the British Virgin Islands; | |
|
||
Charge
|
means this share charge to be entered into between the Chargor and the Chargee; |
|
||
Charged Shares
|
means the Initial Shares and all and any other
shares, warrants and other securities of any kind
(including loan capital) of the Charged Company
now or at any time in the future legally and/or
beneficially owned by the Chargor or in which the
Chargor has any interest and all rights, benefits
and advantages now or at any time in the future
deriving from or incidental to any of the Charged
Shares, including, without limitation:
(a) all dividends, interest and other income paid
or payable in relation to any Charged Shares; and
(b) all shares, securities, rights, monies or
other property accruing, offered or issued at any
time by way of redemption, conversion, exchange,
substitution, preference, option or otherwise in
respect of any Charged Shares (including but not
limited to proceeds of sale);
Charged Shares shall exclude any shares of the Charged Company that may be sold to Ngai Tahu Holdings Corporation Limited (Ngai Tahu) by the Chargor pursuant to a conditional share purchase agreement between Ngai Tahu and the Chargor dated 15 April 2011. |
|
|
||
Charged Company
|
means the company set forth in Column C of Schedule 1 in this Charge; | |
|
||
Company
|
means Agria Asia Investment Limited, a company incorporated in the British Virgin Islands of PO Box 957, Road Town, Tortola, British Virgin Islands; | |
|
||
Enforcement Notice
|
means an enforcement notice served by the Chargee on the Chargor; | |
|
||
Initial Shares
|
means the shares listed in Schedule 1, which are registered at the date of this Charge in the name of the Chargor; | |
|
||
Insolvency Act
|
means the BVI Insolvency Act, 2003 (as amended); | |
|
||
Receiver
|
means as defined in Clause 8; | |
|
||
Register of Members
|
means the register of members held at the Charged Companys registered office, containing the names and addressed of the persons who hold shares in the Charged Company, the number of each class and series of shares held by each member, the date on which the name of each member was entered in the register of members, and the date on which any eligible person ceased to be a member of the Charged Company; | |
|
||
Registry
|
means the Registry of Corporate Affairs in the British Virgin Islands; |
2
|
||
Secured Obligations
|
means all and any amounts of any kind, now or in the future, actual or contingent, due or payable (or expressed to be due or payable) by the Chargor to the Chargee in any currency, actually or contingently, solely and/or jointly and/or severally with another or others as principal or surety on any account whatsoever under or in connection with the Put Option defined and contemplated in the Shareholder Agreement; | |
|
||
Security Interest
|
means any mortgage, charge, pledge, lien, encumbrance, right of set off or any security interest, howsoever created or arising; and | |
|
||
Shareholder Agreement
|
means a shareholder agreement entered into by and between Chargor, Chargee and the Agria Corporation dated 28 June 2011, containing, among other matters, the Put Option as defined in the Shareholder Agreement. | |
|
||
Subscription Agreement
|
means a subscription agreement entered into bv and between Chargor, Chargee, the Company in connection with the subscription of shares in the Company on 29 April 2011 (as may be amended from time to time); | |
|
||
Termination Event
|
means any breach of, or a termination event, or default or event of default under the Shareholder Agreement by the Company or this Charge by the Chargor that is either incapable of remedy or if capable of remedy has been continuing for 7 Business Days following notification by the Chargee. |
1.2 |
In this Charge:
|
(a) |
any reference to a Recital, Clause or Schedule is to the relevant Recital,
Clause or Schedule of or to this Charge and any reference to a Sub-Clause or paragraph
is to the relevant Sub-Clause or paragraph of the Clause or Schedule in which it
appears;
|
(b) |
the clause headings are included for convenience only and shall not affect the
interpretation of this Charge;
|
||
(c) |
use of the singular includes the plural and
vice versa
;
|
(d) |
use of any gender includes the other genders;
|
(e) |
any phrase introduced by the terms including, include, in particular or
any similar expression shall be construed as illustrative and shall not limit the sense
of the words preceding those terms; and
|
(f) |
references to any document or agreement are to be construed as references to
such document or agreement as is in force for the time being and as amended, varied
supplemented, substituted or novated from time to time.
|
3
1.3 |
The Recitals and Schedules form part of this Charge and shall have effect as if set out in
full in the body of this Charge and any reference to this Charge includes the Recitals and
Schedules.
|
1.4 |
The obligations of each person (if more than one person) constituting the Chargor under this
Charge are joint and several.
|
1.5 |
In the event of any conflict between the provisions of this Charge and the Shareholder
Agreement, the provisions of the Shareholder Agreement shall prevail.
|
2 |
Covenant to Pay
|
3 |
Charge
|
3.1 |
The Chargor, with full title guarantee, hereby charges by way of first fixed charge as a
continuing security for the payment and discharge of the Secured Obligations, all its right,
title, interest and benefit present and future in, to and under the Charged Shares subject to
the provisions for release of this Charge set out below.
|
|
3.2 |
Unless and until a Termination Event has occurred:
|
(a) |
the Chargor shall be entitled to exercise all voting rights attaching to the
Charged Shares or any thereof for all purposes not inconsistent with the purposes of
this Charge, any of the Secured Obligations or of the Shareholder Agreement; and
|
(b) |
the Chargor shall be entitled to receive and retain any and all dividends and
other distributions paid in respect of the Charged Shares or any thereof.
|
3.3 |
Subject to Clauses 3.4 and 3.5, on the irrevocable and unconditional payment or discharge by
or on behalf of the Chargor of the Secured Obligations in full, the Chargee shall, at the
request and cost of the Chargor, release this Charge.
|
3.4 |
Any receipt, release or discharge of any security created by this Charge or of any liability
arising under this Charge may only be given by the Chargee in accordance with the provisions
on this Charge and shall not release or discharge the Chargor from any liability to the
Chargee for the same or any other monies which may exist independently of this Charge. Where
such receipt, release or discharge relates to only part of the Secured Obligations such
receipt, release or discharge shall not prejudice or affect any other part thereof nor any of
the rights and remedies of the Chargee hereunder or under any other agreement nor any of the
obligations of the Chargor under this Charge or any other agreement.
|
4
3.5 |
Any release, discharge or settlement between the Chargor and the Chargee shall be conditional
upon no security, disposition or payment to the Chargee or any other person being void, set
aside or ordered to be refunded pursuant to any enactment or law relating to liquidation,
administration or insolvency or for any other reason whatsoever and if such condition is not
fulfilled the Chargee shall be entitled to enforce this Charge as if such release, discharge
or settlement had not occurred and any such payment had not been made.
|
3.6 |
The restriction on the consolidation of mortgages and on power of sale imposed by sections 35
and 40 respectively of the Conveyancing and Law of Property Act 1961 (as amended) (the
CPA
Act
) shall not apply to the security constituted by this Charge.
|
4 |
Covenants by the Chargor
|
4.1 |
it shall deliver to the Chargee the following (on the date hereof) in form and substance
acceptable to the Chargee as security in accordance with the terms of this Charge:
|
(b) |
blank, signed and undated transfers in respect of the Initial Shares in the
form set out in Schedule 2;
|
4.2 |
it shall deliver to the Chargee the following (within 10 Business Days from the date hereof),
a certified true copy of the Chargors register of charges, duly stamped and filed at the
Registry, showing details of this Charge;
|
4.3 |
it shall promptly pay (and shall indemnify the Chargee on demand against) all calls,
instalments and other payments which may be made or become due in respect of the Charged
Shares and so that, in the event of default by the Chargor, the Chargee may do so on behalf of
the Chargor;
|
(a) |
create or permit to exist over all or part of the Charged Shares (or any
interest therein) any Security Interest (other than created or expressly permitted to
be created under this Charge) whether ranking prior to, pari passu with or behind the
security contained in this Charge; or
|
(b) |
sell, transfer or otherwise dispose of the Charged Shares or any interest
therein or attempt or agree to so dispose (other than in accordance with this Charge);
or
|
(c) |
permit any person other than the Chargor or the Chargee or the Chargees
nominee or nominees to be registered as, or become the holder of, the Charged Shares;
or
|
(d) |
vote in favour of a resolution to amend, modify or change the memorandum and
articles of association of the Charged Company or to continue the Charged Company in a
jurisdiction outside the British Virgin Islands; or
|
(e) |
to the extent that the same is within the control of the Chargor, allow or
consent to any further shares in the Charged Company being issued to any person other
than the Chargor (and for the avoidance of doubt any such shares issued to the Chargor
will form part of the Charged Shares in accordance with this Charge);
|
5
4.5 |
it shall promptly forward to the Chargee all material notices, reports, accounts and other
documents relating to the Charged Shares which it may receive from time to time (including all
notices of meetings of the shareholders of the Charged Company);
|
4.6 |
at any time after the occurrence of a Termination Event it shall exercise all voting and
other rights and powers which may at any time be exercisable by the holder of the Charged
Shares as the Chargee may in its absolute discretion direct;
|
4.7 |
it shall not take or accept any Security Interest from the Charged Company or, in relation to
the Secured Obligations, from any third party, without the Chargees prior written consent;
|
4.8 |
unless directed in writing to do so by the Chargee it shall not prove in a liquidation or
winding up of the Charged Company until all the Secured Obligations are paid in full and if
directed to prove by the Chargee (or if the Chargor otherwise receives any payment or other
benefit in breach of this Clause or Clause 4.9) the Chargor shall hold all monies received by
it on trust for the Chargee to satisfy the Secured Obligations; and
|
4.9 |
until all of the Secured Obligations have been paid in full, it shall not claim payment
whether directly or by set-off, lien, counterclaim or otherwise of any amount which may be or
has become due to the Chargor by the Charged Company other than as contemplated and/or
expressly permitted by the Shareholder Agreement.
|
5 |
Representations and Warranties by the Chargor
|
5.1 |
the Chargor is the absolute sole legal and beneficial owner of all of the Initial Shares free
of all Security Interests, trusts, equities and third party claims whatsoever (save those
under this Charge) and that all of the Initial Shares are fully paid up;
|
5.2 |
the Initial Shares represent 80.81% of the shares issued by the Charged Company;
|
5.3 |
the Initial Shares are freely transferable on the books of the Charged Company and no
consents or approvals are required in order to register a transfer of the Initial Shares;
|
5.4 |
no litigation against the Chargor or the Charged Company is current or, to their knowledge
pending or threatened;
|
5.5 |
it is duly incorporated and in good standing under the laws of the jurisdiction in which it
is incorporated and has and will at all times have the necessary power to enter into and
perform its obligations under this Charge and has duly authorised the execution and delivery of this
Charge and the performance of its obligations hereunder;
|
6
5.6 |
this Charge constitutes its legal, valid, binding and enforceable obligation and is a first
priority security interest over the Charged Shares effective in accordance with its terms;
|
5.7 |
the execution, delivery, observance and performance by the Chargor of this Charge will not
require the Chargor to obtain any licences, consents or approvals and will not result in any
violation of any law, statute, ordinance, rule or regulation applicable to it;
|
5.8 |
it is not necessary to file details of this Charge anywhere in the world, save as set out in
sections 162 and 163 of the BCA;
|
5.9 |
it has obtained all the necessary authorisations and consents to enable it to enter into this
Charge and the necessary authorisations and consents will remain in full force and effect at
all times during the subsistence of the security constituted by this Charge;
|
5.10 |
the execution, delivery, observance and performance by the Chargor of the Charge will not
constitute an event of default or trigger any enforcement under any Security Interest in the
Chargors assets nor will it result in the creation of any Security Interest over or in
respect of the present or future assets of the Charged Company;
|
5.11 |
the execution, enforcement or payments made under this Charge will not be subject to any
taxes, fees or charges (including stamp duty) in the British Virgin Islands; and
|
5.12 |
it will procure that details of the Charged Shares shall be entered into the register of
members of the relevant Charged Company.
|
6 |
Power of Attorney
|
7 |
Enforcement
|
7.1 |
The percentage of the Companys shares that may be enforceable under this charge shall be
equal to the Repurchase Price (as defined in the Shareholders Agreement) as a percentage of
the fair value of the Companys equity.
|
7
7.2 |
After this Charge has become enforceable, in accordance with Clause 7.3, the Chargee may in
its absolute discretion enforce all or any part of this Charge in any manner it sees fit. For
the avoidance of doubt, the Chargees rights of enforcement shall include (without limitation)
the right:
|
(a) |
to perfect or improve its title to and security over the Charged Shares in such
manner as the Chargee may in its absolute discretion determine;
|
(b) |
with notice to, or upon consent or concurrence by, the Chargor to sell the
Charged Shares or any part thereof by such method, at such place and upon such terms as
the Chargee may in its absolute discretion determine, with power to postpone any such
sale and in any such case the Chargee may exercise any and all rights attaching to the
Charged Shares as the Chargee in its absolute discretion may determine and without
being answerable for any loss occasioned by such sale or resulting from postponement
thereof or the exercise of such rights;
|
(c) |
to receive and retain all dividends and other distributions made on or in
respect of the Charged Shares or any thereof and any such dividends and other
distributions received by the Chargor after such time shall be held in trust by the
Chargor for the Chargee and be paid or transferred to the Chargee on demand to be
applied towards the discharge of the Secured Obligations;
|
(d) |
to exercise (or enable its nominees to exercise) any and all powers,
discretion, voting or other rights or entitlements conferred on a holder of the Charged
Shares in such manner as the Chargee may in its absolute discretion determine;
|
(e) |
to exercise any and all other rights, powers and discretions of the Chargor in
respect of the Charged Shares in such manner as the Chargee may in its absolute
discretion determine;
|
(f) |
to procure that the Chargee or its nominee or nominees is registered in the
Register of Members of the Charged Company as holder of the legal title in and to the
Charged Shares;
|
(g) |
otherwise to enforce any of the rights of the Chargee under or in connection
with this Charge in such manner as the Chargee may in its absolute discretion
determine; and
|
(h) |
to date and deliver the documents delivered to it pursuant to this Charge as it
considers appropriate and to take all steps to register the Charged Shares in the name
of the Chargee or its nominee or nominees and to assume control as the registered owner
of the Charged Shares.
|
7.3 |
Subject to Clause 7.4 below, the Chargees rights of enforcement in relation to this Charge
(other than those listed in section 66(5) of the BCA) shall become immediately enforceable
upon the occurrence of a Termination Event.
|
7.4 |
For the purposes of section 66(7) of the BCA, notwithstanding any other provision of this
Charge, the Chargee may enforce all rights of enforcement set out in section 66(5) of the BCA
immediately upon the occurrence of a Termination Event that has been continuing for one day
and which remains unrectified for a period of not less than one Business Day following notice
given by the Chargee to the Chargor instructing the Chargor to immediately rectify such
Termination Event (an
Unrectified Termination Event
).
|
8
7.5 |
Neither the Chargee nor any Receiver (as defined in Clause 8 below) will be liable, by reason
of entering into possession of a Charged Share, to account as mortgagee in possession or for
any loss on realisation or for any default or omission for which a mortgagee in possession
might be liable.
|
8 |
Receiver
|
8.1 |
Without prejudice to the provisions of Clause 7 above, upon the service of an Enforcement
Notice the Chargee shall immediately become entitled to appoint one or more person or persons
eligible to be appointed as a receiver under the Insolvency Act as the Chargee thinks fit to
be a receiver (the
Receiver
) in relation to the Charged Shares. Where the Chargee appoints
two or more persons as Receiver, the Receivers may act jointly or independently.
|
8.2 |
The Receiver may take such action in relation to the enforcement of this Charge including,
without limitation, to sell, charge or otherwise dispose of the Charged Shares, to exercise
any powers, discretion, voting or other rights or entitlements in relation to the Charged
Shares and generally to carry out any other action which he may in his sole discretion deem
necessary in relation to the enforcement of this Charge.
|
8.3 |
To the fullest extent permissible under law, the Chargee may exercise any right or power that
the Receiver may exercise in relation to the enforcement of this Charge.
|
8.4 |
The Receiver shall have, in addition to the other powers set out in this Clause, the
following powers:
|
(a) |
power to take possession of, collect and get in the Charged Shares and, for
that purpose, to take such proceedings as may seem to him to be expedient;
|
||
(b) |
power to raise or borrow money and grant security over the Charged Shares;
|
(c) |
power to appoint an attorney or accountant or other professionally qualified
person to assist him in the performance of his functions;
|
(d) |
power to bring or defend any action or other legal proceedings in the name of
and on behalf of the Chargor in respect of the Charged Shares;
|
(e) |
power to do all acts and execute in the name and on behalf of the Chargor any
document or deed in respect of the Charged Shares;
|
(f) |
power to make any payment which is necessary or incidental to the performance
of his functions;
|
(g) |
power to make any arrangement or compromise on behalf of the Chargor in respect
of the Charged Shares;
|
(h) |
power to rank and claim in the insolvency or liquidation of the Charged Company
and to receive dividends and to accede to agreements for the creditors of the Charged
Company;
|
(i) |
power to present or defend a petition for the winding up of the Charged
Company; and
|
(j) |
power to do all other things incidental to the exercise of the foregoing
powers.
|
9
8.5 |
The Receiver shall be the agent of the Chargor and the Chargor alone shall be responsible for
his acts and defaults and liable on any contracts made, entered into or adopted by the
Receiver. The Chargee shall not be liable for the Receivers acts, omissions, negligence or
default, nor be liable on contracts entered into or adopted by the Receiver.
|
9 |
Application of Monies
|
9.1 |
The Chargee (and any Receiver) shall apply the monies received by it as a result of the
enforcement of the security:
|
(a) |
first, in payment or satisfaction of the expenses related to enforcement of
this security (including without limitation the fees and expenses of the Receiver);
|
(b) |
secondly, in meeting claims of the Chargee in respect of the Secured
Obligations; and
|
||
(c) |
thirdly, in payment of the balance (if any) to the Chargor.
|
9.2 |
The Chargee shall not be liable for any loss or damage:
|
(a) |
occasioned by any sale or disposal of the Charged Shares or an interest in the
Charged Shares; or
|
(b) |
arising out of the exercise, or failure to exercise, any of its powers under
this Charge; or
|
(c) |
occasioned by any neglect or default to pay any instalment or accept any offer
or notify the Chargor of any such neglect or default; or
|
(d) |
occasioned by any other loss of whatever nature in connection with the Charged
Shares.
|
10 |
Protection of Purchasers
|
11 |
Continuing Security and Non-Merger
|
10
12 |
Currency
|
12.1 |
For the purpose of, or pending the discharge of, any of the Secured Obligations the Chargee
may, in its sole discretion, convert any moneys received or recovered in any currency under
this Charge (including the proceeds of any previous conversion under this Clause) from their
existing currency of denomination into any other currency at such rate or rates of exchange
and at such time as the Chargee thinks fit.
|
12.2 |
No payment to the Chargee (whether under any judgment or court order or otherwise) shall
discharge the Secured Obligations in respect of which it was made unless and until the Chargee
shall have received payment in full in the currency in which such Secured Obligations were
incurred and, to the extent that the amount of any such payment shall on actual conversion
into such currency fall short of such Secured Obligations expressed in that currency, the
Chargee shall have a further separate cause of action against the Chargor and shall be
entitled to enforce this Charge to recover the amount of the shortfall.
|
13 |
Costs
|
14 |
Variation and Amendment
|
15 |
Assignment
|
15.1 |
The Chargor may not assign or transfer all or any part of its rights, benefits or obligations
under this Charge to any other person without the prior written consent of the Chargee.
|
15.2 |
The Chargee may not assign or otherwise transfer the whole or any part of the rights,
benefits and obligations under the Charge to any other person without the prior written
consent of the Chargor.
|
16 |
Entire Agreement
|
17 |
Further Assurance
|
17.1 |
The Chargor shall promptly execute all documents and do all things that the Chargee may
specify for the purpose of:
|
(a) |
securing and perfecting its security over or title to all or any of the Charged
Shares; or
|
(b) |
enabling the Chargee to vest all or part of the Charged Shares in its name or
in the names of its nominee(s), agent or any purchaser.
|
11
18 |
Notices
|
18.1 |
Without prejudice to any other method of service of notices and communications provided by
law, a demand or notice under this Charge shall be in writing signed by an officer or agent of
the Chargee or the Chargor, as the case may be, and may be served on the Chargor or the Chargee,
as the case may be, by hand, by post, or by facsimile transmission. Any such notice or
communication shall be sent to the address or number of the relevant party as set out below:
|
18.2 |
Any such notice or communication given by the Chargee shall be deemed to have been received:
|
(a) |
if sent by facsimile transmission, at the time of transmission, or the
following Business Day if transmitted after normal business hours;
|
(b) |
if delivered personally (including being sent by courier), at the time of
delivery, or the following Business Day if delivered after normal business hours; and
|
(c) |
if posted, on the fifth Business Day following the day on which it was properly
despatched by courier.
|
18.3 |
Any notice given by the Chargor shall be deemed to have been given only on actual receipt by
the Chargee.
|
18.4 |
In proving such service it shall be sufficient to prove that the envelope containing such
notice was addressed to the address of the relevant party set out in Clause 18.1 (or as
otherwise notified by that party hereunder) and delivered either to that address or into the
custody of the postal authorities as a pre-paid recorded delivery, registered post or airmail
letter, or that the notice was transmitted by fax to the fax number of the relevant party set
out in Clause 18.1 (or as otherwise notified by that party hereunder).
|
18.5 |
For the avoidance of doubt, notice given under this Charge shall not be validly served if
sent by e-mail.
|
12
19 |
Miscellaneous
|
19.1 |
All sums payable by the Chargor under this Charge shall be paid without any set-off,
counterclaim, withholding or deduction whatsoever unless required by law in which event the
Chargor will simultaneously with making the relevant payment under this Charge pay to the
Chargee such additional amount as will result in the receipt by the Chargee of the full amount
which would otherwise have been receivable and will supply the Chargee promptly with evidence
satisfactory to the Chargee that the Chargor has accounted to the relevant authority for the
sum withheld or deducted.
|
19.2 |
No delay or omission on the part of the Chargee in exercising any right or remedy under this
Charge shall impair that right or remedy or operate as or be taken to be a waiver of it nor
shall any single, partial or defective exercise of any such right or remedy preclude any other
or further exercise under this Charge of that or any other right or remedy.
|
19.3 |
The Chargees rights powers and remedies under this Charge are cumulative and are not, nor
are they to be construed as, exclusive of any rights, powers or remedies provided by law or
otherwise and may be exercised from time to time and as often as the Chargee deems expedient.
|
19.4 |
Any waiver by the Chargee of any terms of this Charge or any consent or approval given by the
Chargee under it shall be effective only if given in writing and then only for the purpose and
upon the terms and conditions (if any) on which it is given.
|
19.5 |
If at any time any one or more of the provisions of this Charge is or becomes illegal,
invalid or unenforceable in any respect under any law of any jurisdiction neither the
legality, validity or enforceability of the remaining provisions of this Charge nor the
legality, validity or enforceability of such provision under the law of any other jurisdiction
shall be in any way affected or impaired as a result.
|
19.6 |
Any statement, certificate or determination of the Chargee as to the Secured Obligations or
(without limitation) any other matter provided for in this Charge shall, in the absence of
manifest error, be conclusive and binding on the Chargor.
|
19.7 |
The Chargor shall at all times maintain an agent for service of process in the British Virgin
Islands. Such agent shall be ______ of ______ and any writ, judgment or other notice of
legal process shall be sufficiently served on the Chargor if delivered to such agent at its
address set out above. The Chargor undertakes not to revoke the authority of the above agent
and if, for any reason, such agent no longer serves as agent of the Chargor to receive service
of process the Chargor shall promptly appoint another such agent and advise the Chargee of the
new agents name and address for service.
|
20 |
Law and Jurisdiction
|
20.1 |
This Charge is governed by, and shall be construed in accordance with, the laws of the
British Virgin Islands.
|
20.2 |
The Chargor irrevocably agree for the exclusive benefit of the Chargee that the courts of the
British Virgin Islands shall have jurisdiction to hear and determine any suit, action or
proceeding and to settle any dispute which may arise out of or in connection with this Charge
and for such purposes irrevocably submits to the jurisdiction of such courts.
|
13
/s/ Lai Guanglin | ||||
Name:
|
Lai Guanglin | |||
Title:
|
Director | |||
|
||||
In the presence of: | ||||
|
||||
/s/ Mia Li | ||||
Name:
|
Mia Li | |||
Title:
|
In-house Counsel |
/s/ [Illegible] | ||||
Name:
|
||||
Title:
|
Director | |||
|
||||
In the presence of: | ||||
|
||||
Name:
|
||||
Title:
|
14
Column A
Column B
Column C
Column D
Column E
Place of
incorporation of
Charged
Company
Charged
Company
Place of
incorporation of
Chargor
No. of
shares
British Virgin
Islands
Agria Asia
Investment Limited
British Virgin
Islands
84,078,522
16
Clause | Page | |||
|
||||
1. Interpretation
|
1 | |||
2. Guarantee
|
2 | |||
3. Discharge And Release
|
2 | |||
4. Demands
|
3 | |||
5. Permitted Transfer
|
3 | |||
6. Choice Of Law
|
3 | |||
7. Jurisdiction And Process Agent
|
3 |
THIS GUARANTEE
is made on 28 June 2011
|
|
BETWEEN
|
(1) | Guanglin Lai, holding passport (No. ________) (the Guarantor ) and |
(2) | Agria Group Limited, a company incorporated under the laws of the British Virgin Island (the Company ); |
(3) | New Hope International (Hong Kong) Limited, a company incorporated in Hong Kong ( the Beneficiary ) |
(A) | the Company and the Beneficiary entered into a shareholders agreement on_____, 2011 (the Shareholders Agreement ) in connection with their shareholding in Agria Asia Investments Limited, a company incorporated under the laws of the British Virgin Island ( Agria Asia ). |
(B) | under the Shareholders Agreement, the Company agreed that it will cause the Guarantor to enter into this Guarantee; and | |
(C) | it is intended by the parties hereto that this Guarantee shall take effect as a deed. |
1. | Interpretation | |
1.1 | Definitions : In this Guarantee (including the recitals), except where the context otherwise requires: |
1.2 | Interpretation: except where the context otherwise requires, any references in this Guarantee to: |
(a) | a clause shall be to a clause of this Guarantee; |
(b) | any agreement or document (including, without limitation, references to this Guarantee) shall be deemed to include references to a concession, contract, deed, franchise, license, treaty or undertaking and to such agreement or other document as varied, supplemented, novated or replaced from time to time; |
(c) | persons shall be deemed to be references to or to include, as appropriate, any corporation, association, partnership or other entity and includes their respective successors, transferees, assigns and any persons with whom they may at any time amalgamate; and |
(d) | winding up includes bankruptcy and any procedure under any applicable law which is analogous to winding up or bankruptcy. |
1
2. | Guarantee |
2.1 | At the request of Agria Corporation and in the interest of Agria Corporation, the Guarantor hereby unconditionally and irrevocably: |
(a) | guarantees to the Beneficiary prompt payment by the Company on the due date and due discharge of all of the Guaranteed Obligations in accordance with the Shareholders Agreement; and |
(b) | subject to the terms of the Shareholders Agreement, undertakes to the Beneficiary that, if and each time that the Company does not make payment of any amount of the Guaranteed Obligations, in each case in accordance with the Shareholders Agreement, the Guarantor shall pay to the Beneficiary to which the amount is due in whatever currency denominated or, as the case may be, perform or procure performance of any of the Companys other obligations not performed upon first written demand by the Beneficiary. |
2.2 | The Guarantor acknowledges having received a copy of the Shareholders Agreement and confirms its acceptance of the provisions thereof. |
3. | Discharge And Release | |
3.1 | Upon the first to occur of the following events: |
(a) | the Guaranteed Obligations have been irrevocably discharged in full; |
(b) | the Second Pledge Agreement (as defined in the Shareholders Agreement) has been duly executed and delivered by Agria (Singapore) Pte. Ltd. to the Beneficiary; |
(c) | the Put Options (as defined in the Shareholders Agreement) have been exercised by the Beneficiary to the fullest extent and the Company has paid to the Beneficiary all of the considerations in connection with the Put Options as determined by Section 4.2 of the Shareholders Agreement; | ||
(d) | (i) New Hope does not exercise the Put Option within 30 days after three years following the Completion Date (as defined in the Shareholders Agreement) or (ii) New Hope does not exercise the Put Option within 45 days after the occurrence of all of the events set forth in Section 4.1.2 (a) (b) of the Shareholders Agreement, which occurrence shall be communicated to New Hope by Agria Group within 5 days after such occurrence; and |
(e) | the Beneficiary has waived the Companys performance of the Guaranteed Obligations. |
2
4. | Demands |
5. | Permitted Transfer |
6. | Choice Of Law |
7. | Jurisdiction And Process Agent |
7.1 | All the parties agree that any dispute or claim arising out of or in connection with or relating to this Guarantee, or the breach, termination or invalidity hereof (including the validity, scope and enforceability of this arbitration provision), shall be finally resolved by arbitration in Hong Kong under the auspices of the Arbitration Centre and in accordance with the Hong Kong International Arbitration Centre Procedures for the Administration of International Arbitration ( Arbitration Rules ) as are in force at the date of this Guarantee and as may be amended by the rest of this Clause 7.1. For the purpose of such arbitration, there shall be three arbitrators ( Arbitration Board ). The Beneficiary(ies) involving the dispute shall select one arbitrator and the Guarantor shall select one arbitrator. All selections shall be made within 30 days after the selecting party gives or receives the demand for arbitration. Such arbitrators shall be freely selected, and the parties shall not be limited in their selection to any prescribed list. The Chairman of the Arbitration Centre shall select the third arbitrator. If any arbitrator to be appointed by a party has not been appointed and consented to participate within 30 days after the selection of the first arbitrator, the relevant appointment shall be made by the Chairman of the Arbitration Centre. |
7.2 | All arbitration proceedings shall be conducted in English in strict confidence. The Arbitration Board shall decide any such dispute or claim strictly in accordance with the governing law specified in Clause 6. The order for enforcement of any arbitral award rendered hereunder may be entered in any court having jurisdiction, or application may be made to such court for a judicial acceptance of the award and an order of enforcement, as the case may be. |
3
7.3 | Any award made by the Arbitration Board shall be final and binding on each of the Parties that were parties to the dispute. The Parties expressly agree to waive the applicability of any laws and regulations that would otherwise give the right to appeal the decisions of the Arbitration Board so that there shall be no appeal to any court of law for the award of the Arbitration Board, and a Party shall not challenge or resist the enforcement action taken by any other Party in whose favour an award of the Arbitration Board was given. |
7.4 | The Guarantor irrevocably waives any objections to the jurisdiction of any courts referred to in this Clause 7. |
7.5 | The Guarantor irrevocably consents to service of process or any other document in connection with the arbitration proceedings by facsimile transmission, personal service, delivery at any address specified in this Guarantee or in the Shareholders Agreement or any other usual address, mail or in any other manner permitted by Hong Kong law, the law of the place of service or the law of the jurisdiction where proceedings are instituted. |
4
SIGNED, SEALED AND DELIVERED | ) | |||||||||||
as a DEED by | ) | /s/ Lai Guanglin | ||||||||||
|
|
|||||||||||
the Guarantor | ) | |||||||||||
in the presence of: Mia Li | ) | |||||||||||
|
||||||||||||
SIGNED for and on behalf of | ) | |||||||||||
Agria Group Limited | ) | /s/ Lai Guanglin | ||||||||||
|
|
|||||||||||
|
||||||||||||
by: | /s/ Lai Guanglin | ) | ||||||||||
|
Title: | Director | ) | |||||||||
|
) | |||||||||||
|
||||||||||||
SIGNED for and on behalf of | ) | |||||||||||
New Hope International (Hong Kong) Limited | ||||||||||||
|
||||||||||||
by: | /s/ [Illegible] | ) | ||||||||||
|
Title: | Director | ) | |||||||||
|
) |
5
(1) |
Agria Corporation, a company incorporated under the laws of Cayman Islands (the
Company
);
and
|
|
(2) |
Guanglin Lai (the
Indemnified Person
)
|
(A) |
Agria Group Limited (
Agria Group
), a company incorporated under the laws of British Virgin
Islands and a wholly-owned subsidiary of the Company, and New Hope International (Hong Kong)
Limited (
New Hope
) entered into a shareholders agreement on 28 June 2011 (the
Shareholders
Agreement
) in connection with their shareholding in Agria Asia Investments Limited (
Agria
Asia
), a company incorporated under the laws of the British Virgin Island.
|
(B) |
Pursuant to the Shareholders Agreement, New Hope and the Indemnified Person entered into a
Deed of Guarantee on 28 June, 2011 (the
Deed of Guarantee
), whereby the Indemnified Person
made a personal guarantee (the
Guarantee
) to New Hope for Agria Groups payment obligation
in the event that New Hope exercises its put option pursuant to the Shareholders Agreement.
|
(C) |
The Company has agreed to indemnify the Indemnified Person in respect of his obligations and
liabilities arising out of the Guarantee (the
Obligations
) in accordance with this Deed.
|
(a) |
The Company unconditionally and irrevocably agrees to:
|
(i) |
indemnify the Indemnified Person for all amounts paid to New Hope under the
Deed of Guarantee together with relevant expenses he may incur; and
|
(ii) |
indemnify and hold harmless the Indemnified Person from and against all
losses, costs, damages, expenses, liabilities, actions, claims and demands whatsoever
which the Indemnified Person may incur or sustain or which may be made against the
Indemnified Person by reason of or in any way whatsoever in connection with the
performance of the Obligations under the Deed of Guarantee.
|
(b) |
All payments to be made under this Deed shall be made in full by cash or shares of the
Company at the election of the Indemnified Person, without any set-off or counterclaim
whatsoever and free and clear of any deductions or withholdings in the relevant currency on
the due date to such account as the Indemnified Person may from time to time specify.
|
(c) |
In the event that the Indemnified Person elects to receive the payment to be made by the
Company in the form of shares of the Company pursuant to Section 1(b), the number of shares of
the Company shall be determined based on the volume weighted average price of the ADSs
representing the Companys ordinary shares on the New York Stock Exchange during the three
months from April 13, 2011 being the date on which the Indemnity was approved by the Board of Directors.
|
1
2. |
MISCELLANEOUS
|
(a) |
This Deed shall be continuing and will extend to the ultimate balance of the Obligations,
regardless of any intermediate payment or discharge in whole or in part.
|
(b) |
This Deed shall be binding on the Company and its successors but the Company may not assign
or transfer all or any of its rights or obligations under this Deed. If the Indemnified
Person transfers all or part of its liability under the Obligations to a third party, it shall
so notify the Company and the Indemnified Person shall be entitled to assign to such third
party all rights and benefits under this Deed as relate to the liability of the Indemnified
Person under such Obligations.
|
(c) |
This Deed shall come into effect on the date it is signed by the parties and shall remain in
full force until the Guarantee has been terminated or has expired.
|
|
(d) |
It is intended that this document takes effect as a deed.
|
3. |
NOTICES
|
(a) |
Any notice or other communication to a party to this Deed must be in writing. It must be
addressed for the attention of such person, and sent to such address or fax number as set
forth on signature page hereto or to such other address or fax number as that party may from
time to time notify to the other parties.
|
(b) |
Any notice or other communication made or delivered by one person to another under or in
connection with this Deed will only be effective:
|
(i) |
if by way of fax, when received in legible form; or
|
(ii) |
if by way of letter, when it has been left at the relevant address or five (5)
Business Days after being deposited in the post postage prepaid in an envelope
addressed to it at that address.
|
4. |
LAW AND JURISDICTION
|
(a) |
This Deed is governed by Hong Kong law.
|
(b) |
All the parties agree that any dispute or claim arising out of or in connection with or
relating to this Deed, or the breach, termination or invalidity hereof (including the
validity, scope and enforceability of this arbitration provision), shall be finally resolved
by arbitration in Hong Kong under the auspices of the Arbitration Centre and in accordance
with the Hong Kong International Arbitration Centre Administered Arbitration Rules
(
Arbitration Rules
) as are in force at the date of this Guarantee and as may be amended by
the rest of this Clause 4(b). For the purpose of such arbitration, there shall be three
arbitrators (
Arbitration Board
). The Company shall select one arbitrator and the Indemnified
Person shall select one arbitrator. All selections shall be made within 30 days after the
selecting party gives or receives the demand for arbitration. Such arbitrators shall be freely
selected, and the parties shall not be limited in their selection to any prescribed list. The
Chairman of the Arbitration Centre shall select the third arbitrator. If any arbitrator to be
appointed by a party has not been appointed and consented to participate within 30 days after
the selection of the first arbitrator, the relevant appointment shall be made by the Chairman
of the Arbitration Centre.
|
2
(c) |
All arbitration proceedings shall be conducted in English in strict confidence. The
Arbitration Board shall decide any such dispute or claim strictly in accordance with the
governing law specified in 4(a). The order for enforcement of any arbitral award rendered
hereunder may be entered in any court having jurisdiction, or application may be made to such
court for a judicial acceptance of the award and an order of enforcement, as the case may be.
|
(d) |
Any award made by the Arbitration Board shall be final and binding on each of the Parties
that were parties to the dispute. The Parties expressly agree to waive the applicability of
any laws and regulations that would otherwise give the right to appeal the decisions of the
Arbitration Board so that there shall be no appeal to any court of law for the award of the
Arbitration Board, and a Party shall not challenge or resist the enforcement action taken by
any other Party in whose favour an award of the Arbitration Board was given.
|
(e) |
The Indemnified Person irrevocably waives any objections to the jurisdiction of any courts
referred to in this Clause 4.
|
(f) |
The Indemnified Person irrevocably consents to service of process or any other document in
connection with the arbitration proceedings by facsimile transmission, personal service,
delivery at any address specified in this Deed or in the Shareholders Agreement or any other
usual address, mail or in any other manner permitted by Hong Kong law, the law of the place of
service or the law of the jurisdiction where proceedings are instituted.
|
3
SIGNED, SEALED AND DELIVERED
|
) | /s/ Lai Guanglin | ||||||
|
||||||||
as a
DEED
by
|
) | |||||||
the Indemnified Person
|
) | |||||||
in the presence of: Mia Li
|
) | |||||||
|
||||||||
SIGNED, SEALED AND DELIVERED
|
) | /s/ Gary Yeung | ||||||
|
||||||||
as a
DEED
by
|
||||||||
for and on behalf of
|
) | |||||||
AGRIA CORPORATION
|
) | |||||||
in the presence of:
|
) |
4
Name | Place of Incorporation | |
Agria Group Limited
|
British Virgin Islands | |
China Victory International Holdings Limited
|
Hong Kong | |
Agria Asia Investments Limited
|
British Virgin Islands | |
Agria (Singapore) Pte. Ltd.
|
Singapore | |
Aero Biotech Science & Technology Co., Ltd.
|
PRC | |
Agria Brother Biotech (Shenzhen) Co., Ltd.
|
PRC | |
Agria Biotech Overseas Limited
|
Hong Kong | |
PGG Wrightson Group Ltd.
|
New Zealand | |
Agria Corporation (New Zealand) Ltd.
|
New Zealand |
Name | Place of Incorporation | |
Shenzhen Guanli Agricultural Technology Co., Ltd.
|
PRC | |
Shenzhen Agria Agricultural Co., Ltd.
|
PRC | |
Shenzhen Zhongyuan Agriculture Co., Ltd.
|
PRC | |
Beijing Nong Ke Yu Seeds International Co., Ltd.
|
PRC | |
Tianjin Beiao Seed Technology Development Co., Ltd.
|
PRC | |
Wuwei NKY Seeds Co., Ltd.
|
PRC | |
Agria Asia International Limited
|
Hong Kong | |
Agria HongKong Limited
|
Hong Kong |
By: | /s/ Xie Tao | |||||
|
Name: | Xie Tao | ||||
|
Title: | Chief Executive Officer |
By: | /s/ John Layburn | |||||
|
Name: | John Layburn | ||||
|
Title: | Acting Chief Financial Officer |
By: | /s/ Xie Tao | |||||
|
Name: | Xie Tao | ||||
|
Title: | Chief Executive Officer |
By: | /s/ John Layburn | |||||
|
Name: | John Layburn | ||||
|
Title: | Acting Chief Financial Officer |
Sincerely yours,
|
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/s/ Commerce & Finance Law Offices | ||||
Commerce & Finance Law Offices |
Our ref
|
GDK/JLL/630408/3932871v1 | |
Direct tel
|
+852 2971 3090 | |
Email
|
jo.lit@maplesandcalder.com |
Yours faithfully,
|
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|
||
/s/ Maples and Calder
|
||
|
||
Maples and Calder
|
/s/ Ernst & Young Hua Ming
|
||
Shenzhen, Peoples Republic of China
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June 28, 2011
|
/s/ GHP Horwath, P.C.
|
||
GHP
Horwath, P.C.
|
||
Denver, Colorado
June 28, 2011 |