Exhibit 10.18
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Wuxi Enzyme Factory as Transferor
and
Genencor Mauritius Ltd. as
Transferee
and
Genencor (Wuxi) Bio-Products Co.,
Ltd.
AGREEMENT FOR TRANSFER OF EQUITY
INTEREST
November 30, 2004
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AGREEMENT FOR TRANSFER OF EQUITY
INTEREST
THIS AGREEMENT FOR
TRANSFER OF EQUITY INTEREST is made by and among the following
Parties after friendly consultation on the basis of principles of
equality and mutual benefit:
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Wuxi Enzyme
Factory
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25 Tonghui Road
West
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Wuxi City,
Jiangsu Province
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The
People’s Republic of China, 214035
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Fax:
(0510) 370-9726
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Legal
Representative: Weidong Huang,
Director
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(hereinafter
referred to as “ Party A ” or
“WEF”);
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Genencor
Mauritius, Limited
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c/o Genencor
International, Inc.
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200 Meridian
Centre Blvd
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Suite 300
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Rochester, New
York 14618
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U. S.
A.
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Fax:(001-585)
244-2806
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Legal
Representative: John J. Gell,
Director
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(hereinafter
referred to as “ Party B ” or Genencor);
and
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Genencor (Wuxi)
Bio-Products Co., Ltd.
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27 Tonghui Road
West
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Wuxi City,
Jiangsu Province
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The
People’s Republic of China, 214035
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Fax:(0510)
370-9726
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Legal
Representative: John J. Gell,
Chairman
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(hereinafter
referred to as “ Party C ” or the
“JV”);
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(Party A, Party B and Party C are
hereinafter referred to collectively as the “ Parties
” and individually as a “ Party
”).
RECITALS
WHEREAS
, Party A and Synder, Inc., a
California, United States corporation (“Synder”)
entered into certain Equity Joint Venture Contract on
September 11, 1992, whereby Party A and Synder jointly
invested in and established a China-Foreign joint venture limited
liability company under the law of PRC, as approved by Wuxi Foreign
Investment Administration Commission (“Wuxi FIAC”) on
September 22,
1
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1992 [waijingmao — sufuzizi
(1992) 5488], and a business license was issued by Wuxi branch
of the State Administration of Industry and Commerce (“Wuxi
SAIC”) on September 28, 1992.
WHEREAS
, Party A and Synder entered into
certain Amendments to the Joint Venture Contract and Amendments to
Articles of Association on July 3, 1996 to decrease its
registered capital from [ * * * ] to [ * * * ] and adjust the
number of directors each party appoints to the board.
WHEREAS
, Party B and Synder entered into
certain Joint Venture Equity Purchase Agreement on May 8,
1998, whereby Synder transferred to Party B all of its 25% equity
interests in Party C. The transfer (“Synder Transfer”)
was approved by Wuxi FIAC on June 18, 1998 [(98) Xi Wai Guan
Wei Zi Zi No. 128], and was registered with (Wuxi SAIC) on
June 29, 1998.
WHEREAS
, Party A and Party B entered into
certain Equity Interest Transfer Agreement on May 10, 1998,
whereby Party A transferred to Party B part of its equity interests
in Party C. The transfer, together with Synder transfer, and
certain duly executed Amended and Restated Equity Joint Venture
Agreement and Amended and Restated Articles of Association were
approved by Wuxi FIAC and registered with Wuxi SAIC.
WHEREAS
, Party A and Party B entered into
certain Agreement for the First Amendment to the Amended and
Restated Equity Joint Venture Contract and First Amendments to the
Amended and Restated Articles of Association to increase the
Registered Capital from [ * * * ] to [ * * * ], and as a result,
the equity ratio between Party A and Party B has been adjusted to
15.15% for WEF, and 84.85% for Genencor. The amendments and capital
increase contemplated thereby were approved by Wuxi FIAC
[waijingmao — sufuzizi (2003) 5844] and registered with
Wuxi SAIC.
WHEREAS
, Party A intends to transfer all
of its 15.15% equity interest in Party C, and Party B intends to
purchase such equity interest.
NOW THEREFORE
, the Parties hereto have reached
the following agreement in accordance with Chinese laws and
regulations and through friendly consultation and in conformity
with the principle of “equality and mutual
benefit”.
AGREEMENT
Article 1.
Definitions .
The following terms, when used in
capitalized form in this Agreement, shall have the meanings
indicated in this Article 1. Other terms are defined elsewhere
in this Agreement.
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(1)
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“ Affiliate ”
shall have the meaning set forth in Article 2.
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(2)
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“ Agreement ”
means this Agreement for Transfer of Equity Interest and all
Appendices referenced herein.
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2
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(3)
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“ Articles of
Association ” means the Articles of Association of Party
C dated September 11, 1992, as amended by Amendments to
Articles of Association dated July 3, 1996, and May 10,
1998, and was replaced in its entirety by certain Amended and
Restated Articles of Association dated May 10, 1998 by Party A
and Party B, which was further amended by certain Agreement for the
First Amendment to the Amended and Restated Equity Joint Venture
Contract and First Amendment to the Amended and Restated Articles
of Association (“Agreement for First
Amendment”).
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(4)
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“ Assumed Obligations
” means Party A’s liabilities and obligations under the
Articles of Association.
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(5)
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“ WUXI FIAC ”
means Wuxi Foreign Investment Administration Commission, the
approving authority duly designated by the Ministry of Commerce of
the People’s Republic of China.
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(6)
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“ Closing ” shall
have the meaning set forth in Article 7.
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(7)
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“Employment Status
Date” shall have the meaning set forth in
Article 8(6).
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(8)
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“ Encumbrances ”
means any and all liens, claims, interests, options, rights of
first offer or refusal, pre-emptive rights or prior transfers,
agreements to provide any of the foregoing, and any other
restriction or limitation of any nature whatsoever affecting the
Transferred Interest.
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(9)
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“Joint Venture
Contract” means certain Equity Joint Venture
Contract entered into by and between Party A and Synder dated
September 11, 1992, as amended by Amendments to the Joint
Venture Contract dated July 3, 1996, and May 10, 1998,
and was replaced in its entirety by certain Amended and Restated
Joint Venture Contract dated May 10, 1998 by Party A and Party
B, which was further amended by Agreement for First
Amendment.
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(10)
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“ PRC ” means The
People’s Republic of China.
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(11)
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“ Registered Capital
” means the registered capital of Party C, which is [ * * *
], all of which has been paid in (see business license of Party C,
attached hereto as Exhibit A).
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(12)
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“ Transferred Interest
” means all of Party A’s right, title and interest in
and to Party C and in, to and under the JV Contract and the
Articles of Association, and including, without limitation, Party
A’s 15.15% equity ownership interest in the Registered
Capital of Party C, and including, further, any loans or other
obligations owing by Party C to Party A, if any.
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(13)
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“ WFOE ” means
wholly foreign owned enterprise.
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(14)
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“ Wuxi SAIC ”
shall have the meaning set forth in Recitals.
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3
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Article 2.
Transfer . Party A hereby
agrees to sell, convey and deliver to Party B, and, subject only to
the conditions expressly set forth in this Agreement, does by this
document sell, convey and deliver to Party B, the Transferred
Interest, free and clear of all Encumbrances; and Party B agrees to
accept and pay for such transfer and to assume the Assumed
Obligations, all in accordance with the terms and conditions of
this Agreement (the transfer by Party A of the Transferred Interest
and the assumption by Party B of the Assumed Obligations are
together referred to herein as the “ Transfer
”). Subject to necessary government approvals, Party B may
assign its right to receive the transfer of the Transferred
Interest to an Affiliate. For the purpose of this agreement, the
term “Affiliate” of Party B shall mean any corporation
or legal entity that (i) controls; (ii) is controlled by; or
(iii) under the common control with Party B.
Article 3. Purchase
Price . In exchange for
the Transferred Interest, Party B shall pay or cause to be paid to
or on behalf of Party A (as directed by Party A) a purchase price
in the amount of [ * * * ] (“ Purchase Price ”),
which is equivalent to Renminbi [ * * * ], converted in accordance
with the median of buying and selling rates as of the signing date
of this Agreement, in the manner and at the times provided in
Article 4.
Article 4. Payment of
Purchase Price . The
Purchase Price shall be paid in immediately available fund at the
Closing, as such term being defined in Article 7.
Article 5. Taxes and
Fees .
Each Party shall be responsible
for the payment of any taxes imposed on such Party as a result of
the Transfer. Party B shall pay all fees imposed in connection with
the governmental approvals required in connection with the
Transfer. Each Party shall be responsible for its own professional
and other third party and internal expenses incurred in connection
with the negotiation and performance of this Agreement.
Article 6. Conditions
Precedent . The Closing
of Transfer is subject to the fulfillment (or written waiver
executed by Party B) of the following conditions
precedent:
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(1)
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unanimous approval of the Transfer
and of the terminations and amendments identified in paragraph
(5) by the board of directors of Party C substantially in the
form attached hereto as Exhibit B;
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(2)
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approval of or consent to the
Transfer (including the Purchase Price and payment terms therefor)
and of the terminations and amendments identified in paragraph
(4) by the board of directors of Party A or equivalent
decision-making body and by the appropriate governmental authority
in charge of Party A;
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(3)
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approval of the Transfer (including
the Purchase Price and payment terms therefor) and of the
terminations and amendments identified in paragraph (5) by the
senior management of Party B;
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4
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(4)
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verification of the assets
evaluation report for the equity interest to be transferred and any
approval, confirmation, consent and documents as required by the
Approving Authority in giving the approval as specified in
paragraph (6) of this Article, by Wuxi Bureau of Finance or
any appropriate authority as designated by the State Assets
Supervision and Administration Commission of the People’s
Republic of China;
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(5)
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execution by the Parties of an
instrument formally terminating the JV Contract, in substantially
the form set forth in Exhibit C, and any necessary amendments
to the Articles of Association and other necessary government
documents formally removing Party A as a party thereto;
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(6)
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approval by the Wuxi Foreign
Investment Administration Commission (“Wuxi FIAC”),
which originally approved the establishment of the joint venture
of: (a) the Transfer (including the approval of an affiliate
of Party B as the recipient of the Transfer, should Party B so
decide); (b) all amendments to the JV Contract and Articles of
Association; and (c) establishment of Party C as a WFOE; and the
issuance by Wuxi FIAC of an amended approval certificate reflecting
such approvals, as well as the approval of any other governmental
authority necessary in order to consummate the contemplated
transaction;
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(7)
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issuance to Party C of an amended
business license by the Wuxi branch of the State Administration of
Industry and Commerce or its relevant local office, confirming that
Party C is a WFOE, wholly owned by Party B;
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(8)
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execution and delivery to Party C of
letters by the person appointed by Party A to the board of
directors of Party C resigning as director effective on the Closing
Date, in the form attached hereto as Exhibit D.
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Article 7. Closing of the
Transaction .
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(1)
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The
consummation of the Transfer shall take place within forty-five
(45) days following the satisfaction of the conditions set
forth in Article 6 or at such other time and place as the
Parties may agree in writing (the “ Closing Date
”). On the Closing Date, Party A shall deliver to Party C
evidence of the approvals described in paragraphs (2) and
(4) of Article 6 and the documents described in
paragraphs (5) and (8) of Article 6, and Party B
shall provide for the payment of the Purchase Price in
full.
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(2)
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Effective on the Closing Date, Party
A shall cease to have any right or interest in or to Party C,
including with respect to any of Party C’s assets or
liabilities, the Registered Capital of Party C, the right to
receive profits or dividends from Party C, any technology and
intellectual property owned or controlled by Party C and the right
to participate in the management or commercial matters of Party C,
and Party A shall cease to have any interest in the JV Contract and
Articles of Association.
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Article 8.
Representations, Warranties and Additional Covenants of Party
A .
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Party A hereby represents,
warrants and covenants to Party B as follows:
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(1)
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Organization and
Authority .
Party A is a legal entity duly organized and validly existing under
the laws of the PRC. Party A has full corporate power and authority
to enter into and perform this Agreement. This Agreement
constitutes the legal, valid and binding obligation of Party A,
enforceable against Party A in accordance with its terms. Party A
has taken all necessary action and obtained necessary approvals to
authorize the execution and performance of this
Agreement.
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(2)
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No Conflict . The execution and performance of
this Agreement by Party A does not and will not contravene,
conflict with or constitute a breach or default under Party
A’s articles of association, any resolution adopted by Party
A’s board of directors, or any material agreement or
instrument to which Party A is bound.
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(3)
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No Approvals . Except as specifically provided in
this Agreement, Party A is not required to obtain the consent or
approval of any governmental agency or other third party in order
to execute and perform its obligations under this
Agreement.
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(4)
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No Encumbrances
. There are now and at
the time of Transfer will be no Encumbrances affecting or impairing
the Transferred Interest or Party A’s right, power and
authority to transfer the Transferred Interest in accordance with
the terms of this Agreement.
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(5)
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No Company Obligations
. There are no
contractual or other obligations owing by Party C or Party B (other
than payment of the Purchase Price) to Party A, whether for the
payment of money, the return of equipment or other property, or for
any other reason, including without limitation, any rights to Party
C’s properties of any kind, tangible and intangible,
personal, real or intellectual, or rights under contracts, or for
reimbursement or compensation. Party A has fully performed all of
its obligations with respect to Party C arising under the Articles
of Association or under applicable law.
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(6)
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No Use of Confidential
Information .
Based on (i) the immediately preceding paragraph (5); and
(ii) the fact that effective on Closing, Party A shall no
longer have any rights, title and interests in and to Party C or
its properties; and (iii) under the JV Contract and Articles
of Association, unless prior written consent has been given by an
authorized representative of Party B or Party C, Party A and its
on-post and active employees as of November 30, 2004 (the
“Employment Status Date”) (exclusive of those who, on
the Employment Status Date are inactive and off-post workers,
“internally deemed
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