Document:

Exhibit 10.1

 

Execution Version

 

IRREVOCABLE UNDERTAKING

 

	
  To:

  	
  Atlantic
  Industries (the Offeror)

  
	
   

  	
  PO
  Box 309GT

  
	
   

  	
  Ugland
  House

  
	
   

  	
  South
  Church Street

  
	
   

  	
  George
  Town

  
	
   

  	
  Grand
  Cayman

  
	
   

  	
  Cayman
  Islands

  
	
   

  	
   

  
	
  From:

  	
  China
  Hui Yuan Juice Holdings Co., Ltd. (the Shareholder)

  
	
   

  	
  Scotia
  Centre

  
	
   

  	
  4th
  Floor

  
	
   

  	
  P.O. Box
  2804

  
	
   

  	
  George
  Town

  
	
   

  	
  Grand
  Cayman

  
	
   

  	
  Cayman
  Islands

  
	
   

  	
   

  
	
   

  	
  Mr. Zhu
  Xinli (the Guarantor)

  
	
   

  	
  c/o
  Beijing Huiyuan Beverage & Food Group Limited

  
	
   

  	
  Beixiaoying
  Town

  
	
   

  	
  Shunyi
  District

  
	
   

  	
  Beijing

  
	
   

  	
  People’s
  Republic of China

  

 

31 August 2008

 

Dear
Sirs,

 

Offer for China Huiyuan Juice Group Limited (Huiyuan)

 

The
Shareholder understands that an offer is to be made by or on behalf of the
Offeror to acquire all the issued ordinary shares of Huiyuan (the Share Offer), to acquire all the
outstanding convertible bonds of Huiyuan (the Convertible
Bond Offer) and to cancel all the outstanding share options of
Huiyuan (the Option Offer and, together
with the Share Offer and the Convertible Bond Offer, the Offers),
substantially on the terms of the draft announcement attached as Schedule 3 to
this Deed (the Announcement)
or on such other terms as may be agreed between the Offeror and Huiyuan or as
may be required to comply with the requirements of the Securities and Futures
Commission of Hong Kong (the SFC), the
Hong Kong Code on Takeovers and Mergers (the Code),
The Stock Exchange of Hong Kong Limited (the Stock
Exchange) or the Rules Governing the Listing of Securities
on the Stock Exchange (the Listing Rules).
This Deed sets out the terms and conditions on which the Shareholder will
accept the Share Offer when it is made and sets out certain undertakings to be
given by the Offeror to the Shareholder. The Guarantor has agreed to guarantee
the performance by the Shareholder of its obligations under this Deed.

 

A
reference in this Deed to the Offers, the Share Offer, the Convertible Bond Offer or the Option Offer  also includes any new,
increased, renewed or revised offers made by or on behalf of the Offeror to
acquire shares in Huiyuan, to acquire the outstanding convertible bonds of
Huiyuan or to cancel the share options of Huiyuan, as the case may be, provided
that the terms of such offers are no less favourable to acceptors than the
terms set out in the Announcement.

 

Terms
defined in Schedule 1 hereto shall have the same meaning in this Deed.

 

Dealings
and undertakings

 

1.                                       The Shareholder undertakes to the Offeror
that before the Offers close, lapse or are withdrawn, it shall not:

 

1

 

(a)                                  sell,
transfer, Encumber, or otherwise dispose of any interest in any Relevant Shares
or any Convertible Bonds, other than pursuant to its acceptance of the Share
Offer or the Convertible Bond Offer;

 

(b)                                 accept any
other offer in respect of the Relevant Shares or the Convertible Bonds;

 

(c)                                  vote in
favour of any resolution to approve any scheme of arrangement of Huiyuan which
is proposed in competition with the Offers; or

 

(d)                                 except
upon exercise of its rights of conversion under the Convertible Bonds, acquire,
and shall not permit any person acting in concert with it, to acquire any
Shares or any warrants, options, subscription rights or other rights to
subscribe for, acquire or convert into such Shares or any interest therein or
agree to do so without the prior written consent of the Offeror.

 

2.                                       The Guarantor
undertakes to the Offeror that before the Share Offer closes, lapses or is
withdrawn, it shall not, and shall procure that none of his Affiliates shall,
enter into any contract or arrangement with any Group Company without the prior
written consent of the Offeror, except: (i) pursuant to and in accordance
with the terms of any existing contract between the Guarantor and/or any of his
Affiliates and a Group Company; and (ii) for contracts or arrangements
entered into in the ordinary course of business of the Group and on normal arms’
length commercial terms and which would be treated as de minimis transactions
under Rule 14A.31 of the Listing Rules.

 

Undertaking to accept the Offers

 

3.                                       In consideration of the Offeror’s
undertakings in paragraph 5, the Shareholder undertakes to the Offeror
that it:

 

(a)                                  shall
accept the Share Offer in respect of the Relevant Shares in accordance with the
procedure for acceptance set out in the formal offer document to be issued by
or on behalf of the Offeror and Huiyuan in connection with the Offers (Composite Document) not later than
seven days after the Offeror posts the Composite Document to Huiyuan
shareholders;

 

(b)                                 shall use
its reasonable efforts to cause HKSCC Nominee Limited (HKSCC)
to accept the Share Offer in accordance with the procedure for acceptance set
out in the Composite Document not later than seven days after the Offeror posts
the Composite Document;

 

(c)                                  shall not
withdraw any acceptances of the Share Offer and will use its reasonable efforts
to cause HKSCC not to do so;

 

(d)                                 shall sell
the Relevant Shares free of any Encumbrance and together with all rights of any
nature attaching to those Shares, including the right to all dividends, and
other distributions, declared, made or paid on or after the date of the
Announcement; and

 

(e)                                  shall,
once the Share Offer has become or has been declared unconditional in all
respects, take all steps required of it under the terms of the Convertible
Bonds to convert all its Convertible Bonds into Shares and:

 

(i)                                     upon becoming the registered holder
of such Shares, it shall accept the Share Offer in respect of all such Shares
in accordance with the procedure

 

2

 

for acceptance set
out in the Composite Document not later than seven days after becoming the
registered holder of such Shares;

 

(ii)           it shall not withdraw any acceptances of the Share
Offer in respect of such Shares; and

 

(iii)          it shall sell such Shares free of any Encumbrance and
together with all rights of any nature attaching to those Shares, including the
right to all dividends, and other distributions, declared, made or paid on or
after the date of the Announcement; or

 

(f)            if either: (i) upon the Share Offer becoming or
being declared unconditional in all respects, there is insufficient time for it
to convert the Convertible Bonds into Shares according to the timetable of the
Offers as stipulated by the Code; or (ii) it is prevented or is unable to
convert the Convertible Bonds into Shares for any other reason:

 

(i)            it shall
accept the Convertible Bond Offer in respect of all the Convertible Bonds in
accordance with the procedure for acceptance set out in the Composite Document
not later than seven days after the Share Offer becomes or is declared
unconditional in all respects;

 

(ii)           it shall
not withdraw any acceptances of the Convertible Bond Offer; and

 

(iii)          it shall
sell the Convertible Bonds free from any Encumbrance of any nature whatsoever
and together with all rights of any nature attaching to those Convertible
Bonds, including the right to all interest payments paid on or after the date
of the Announcement.

 

Documentation

 

4.                                       The Shareholder and the Guarantor consent to:

 

(a)                                  this Deed
and the Deed of Non-Competition being disclosed to the SFC and the Stock
Exchange;

 

(b)                                 the
inclusion of references to them, particulars of this Deed and of the Deed of
Non-Competition, and their respective holdings of relevant securities of
Huiyuan by them being included in the Announcement and the Composite Document;
and

 

(c)                                  this Deed
and the Deed of Non-Competition being made available for inspection as required
by Note 1 to Rule 8 of the Code or the Listing Rules.

 

Offeror’s undertakings

 

5.                                       The Offeror agrees with the Shareholder and
the Guarantor that:

 

(a)                                  it will make the Offers in
accordance with the Announcement and the Announcement will be released
substantially in the form attached (or in such other form as may be agreed
between the Offeror and the Shareholder or as may be required to comply with
the requirements of the SFC or the Stock Exchange) within ten Business Days of
the date of this Deed(or such later date as the Offeror and the Shareholder may
agree);

 

(b)                                 it shall, at its own cost, use all
reasonable efforts to ensure that the Pre-Condition

 

3

 

is fulfilled promptly
after the date of the Announcement, and in any event, no later than the First
Long Stop Date;

 

(c)                                  without prejudice to the generality
of paragraph 5(b) above, it shall initiate contact with the relevant
Governmental Authority relating to the satisfaction of the Pre-condition within
seven days of the date of the Announcement with a view to making the PRC
Antitrust Filing within 20 days of the date of the Announcement;

 

(d)                                 it shall
not announce a change to the initial First Long Stop Date without the prior
consent of the Shareholder; and

 

(e)                                  subject to
the Share Offer becoming or being declared unconditional in all respects:

 

(i)            it shall procure that Huiyuan complies with its
material obligations under the Supply Contract;

 

(ii)           it undertakes that, throughout the term of the Supply
Contract, neither it nor any of its Affiliates, including the Group Companies,
will invest or acquire any interest, whether direct or indirect, in any
business or operation in the People’s Republic of China that competes with the
Upstream Business, provided nothing in this sub paragraph 5(e)(ii) shall
affect any existing investment or investments which it or its Affiliates has as
at the date of this Deed; and

 

(iii)          it confirms that it is its current intention that the
brand name “Huiyuan” will continue to be used in the juice business in the PRC
of the Offeror and its Affiliates.

 

Co-operation in relation to Pre-Condition

 

6.                                       The Offeror, the Shareholder and the
Guarantor shall, and, in the case of the Shareholder and the Guarantor, shall
use all reasonable efforts to procure that Huiyuan shall, use all reasonable
endeavours to co-operate with each other in any dealings with or submissions to
any Governmental Authority in connection with the Share Offer to ensure that
the Pre-Condition is satisfied promptly after the date of the Announcement and,
in connection with such co-operation, the Offeror, the Shareholder and the Guarantor
agree that:

 

(a)                                  each party shall notify the other
parties and their advisers (and provide copies or, in the case of non-written
communications, details) of any requests from or other communications with any
Governmental Authority relating to the Pre-Condition, provided that each party
shall not be required to disclose to the other parties any confidential
information or business secrets which have not previously been disclosed to
such parties (such information to be exchanged only on a counsel-to-counsel
basis by the parties’ advisers), and shall promptly comply with such requests;

 

(b)                                 each party shall consult and
cooperate with the other parties and their advisers prior to the submission of
any notifications, filings, presentations and memoranda, or other communication
orally or in writing, of any responses, arguments, proposals and analyses to
any Governmental Authority regarding the Pre-Condition and shall take into
account any reasonable comments and requests of the other parties and their advisers,
provided that each party shall not be required to disclose to the other parties
any confidential information or business secrets which have not previously been
disclosed to such parties (such information to be

 

4

 

exchanged only on a
counsel-to-counsel basis by the parties’ advisers);

 

(c)                                  all material discussions, telephone
calls and meetings with a Governmental Authority regarding the Pre-Condition
shall include representatives of the Offeror, Huiyuan and the Shareholder, or
their advisers, to the extent that such discussions, telephone calls and
meetings relate to information that is not confidential information or business
secrets which have not previously been disclosed to the other parties (such information
to be exchanged only on a counsel-to-counsel basis by the parties’ advisers);
and

 

(d)                                 each party
shall regularly review with the other parties and their advisers the progress
of any notifications or filings submitted in order to satisfy the Pre-Condition
with a view to obtaining clearance from any Governmental Authority at the
earliest reasonable opportunity.

 

Warranties

 

7.                                       The Shareholder warrants to the Offeror in
terms set out in Schedule 2 to this Deed (the  Warranties) as at the date of this Deed and the
Completion Date, by reference to the facts and circumstances existing as at
such dates respectively.

 

8.                                       Each of the Warranties shall be construed as
a separate and independent warranty and (except where expressly provided to the
contrary) shall not be limited or restricted by reference to or inference from
the terms of any other Warranty.

 

9.                                       The Warranties are given subject to and are
qualified by, any fact, matter or circumstance which has been Disclosed.

 

10.                                 The Shareholder undertakes to the Offeror
that, as soon as reasonably practicable upon it becoming aware, between the
date of this Deed and the Completion Date, of any fact, matter or circumstance
relating to any member of the Group, which may constitute a breach of any of
the Warranties as at the date of this Deed and/or would constitute a breach if
they were repeated at the Completion Date by reference to the facts and
circumstances then subsisting, it will promptly disclose in writing such fact,
matter or circumstance to the Offeror.

 

11.                                 The liability of the Shareholder for any
Claim shall be limited in the following manner:

 

(a)                                  the
liability of the Shareholder for any Claim shall not exceed 41.53% of
such Claim other than a Claim involving a breach of any statements set out
under Part A of Schedule 2 to this Deed (the  Title Warranties) provided that the maximum
aggregate liability of the Shareholder arising from a breach of the Title
Warranties together with all other Claims shall not exceed an amount equal to
the Consideration received by the Shareholder under the Share Offer (or an
equivalent amount in any other currency);

 

(b)                                 the Shareholder shall not be liable
for any Claim unless the aggregate amount of the liability of the Shareholder
for Claims brought against the Shareholder  exceeds HK$160,000,000 (or an equivalent
amount in any other currency), in which event the Shareholder will be liable
for the full amount and not just the excess;

 

(c)                                  the
Shareholder shall not be liable in respect of a Claim unless the Offeror has
given the Shareholder written notice of the Claim (stating in reasonable detail
the

 

5

 

nature of the Claim and, if
practicable, the amount claimed) on or before the date which is eighteen months
after the Completion Date;

 

(d)                                 any Claim shall (if it has not been
previously satisfied, settled or withdrawn) be deemed to have been withdrawn 6
months after the notice is given pursuant to paragraph 11(c) above,
unless legal proceedings in respect of it have been commenced by being both
issued and served. No new Claim may be made in respect of the facts, matters,
events or circumstances giving rise to any such withdrawn Claim;

 

(e)                                  if any Claim is based upon a
liability which is contingent only, the Shareholder shall not be liable to pay
unless and until such contingent liability gives rise to an obligation to make
a payment (but the Offeror has the right under paragraph 11(c) above
to give notice of that Claim before such time);

 

(f)                                    the Shareholder shall not be liable
for any Claim to the extent that it would not have arisen but for, or has been
increased or not reduced as a result of, any voluntary act, omission or
transaction carried out after the Completion Date by
the Offeror or any of its Affiliates (or its or their respective directors,
employees or agents or successors in title) outside the ordinary and usual
course of business of a Group Company as at the Completion Date;

 

(g)                                 the Offeror shall procure that all
reasonable steps are taken to avoid or mitigate any loss or damage which it may
suffer in consequence of any breach by the Shareholder of the terms of this
Deed or any fact, matter, event or circumstance likely to give rise to a Claim;

 

(h)                                 the Shareholder shall not be liable
in respect of any Claim to the extent that the amount of such Claim is covered
by a policy of insurance effected by or for the benefit of the Group Companies;

 

(i)                                     the Shareholder shall not be liable
for any Claim if and to the extent it is attributable to, or the amount of such
Claim is increased as a result of: (i) any legislation not in force at the
date of this Deed; (ii) any change of law (or any change in interpretation
on the basis of case law), regulation, directive, requirement or administrative
practice; or (iii) any change in the rates of taxation in force at the
date of this Deed;

 

(j)                                     the Offeror shall not be entitled to
recover damages or obtain payment, reimbursement, restitution or indemnity more
than once in respect of any one liability, loss, cost, shortfall, damage, deficiency,
breach or other set of circumstances which gives rise to more than one Claim;
and

 

(k)                                  if a breach of the Warranties is
capable of remedy, the Offeror shall only be entitled to compensation if it
gives the Shareholder written notice of the breach and the breach is not
remedied within 30 days after the date on which such notice is served on the
Shareholder.

 

12.                                 Nothing in this Deed shall limit or exclude
the liability of the Shareholder to the extent that such liability arises as a
result of its own fraud.

 

13.                                 The Shareholder undertakes, if any Claim is
made against it under this Deed, not to make any claim against any member of
the Group or, except where such claim arises out of any fraudulent act by the
person against whom the claim is to be made, any director, employee of the
Group on which the Shareholder may have relied before agreeing to any terms of

 

6

 

this Deed.

 

14.                                 The Guarantor warrants to the Offeror, as at
the date of this Deed and the Completion Date, by reference to the facts and
circumstances existing as at such dates respectively, that:

 

(a)                                  he has
obtained or satisfied all regulatory and other approvals, and any other
conditions, necessary to execute and perform his obligations under this Deed;
and

 

(b)                                 the
execution and delivery by him of this Deed, and the performance and completion
of this Deed by him:

 

(i)            will not infringe any
applicable laws;

 

(ii)           will not result in any
breach of the terms of, or constitute a default under, any instrument,
agreement or governmental, regulatory or other judgment, decree or order to
which he is a party or by which he is bound; and

 

(iii)          will not conflict with any
certificates, licences or permits he holds that enables him to carry on any
business or operations operated by him; and

 

(c)                                  this Deed constitutes legal, valid
and binding obligations of him enforceable in accordance with its terms.

 

15.                                 Each of the
Shareholder and the Guarantor acknowledges that the Offeror has entered into
this Deed in reliance upon the Warranties and the warranties set out in
paragraph 14.

 

Termination

 

16.                                 This Deed shall automatically terminate if:

 

(a)                                  the
Announcement is not released within ten Business Days of the date of this Deed
(or such later date as the Offeror and the Shareholder may agree);

 

(b)                                 the Offers
are not made (by posting of the Composite Document) by the Latest Despatch
Date;

 

(c)                                  the Offers
include any material terms or are subject to any conditions other than those
set out in the draft of the Announcement; or

 

(d)                                 the Share
Offer lapses or is withdrawn.

 

17.                                 Termination of this Deed shall be without
prejudice to a party’s accrued rights and remedies, obligations and liabilities
under this Deed as at the date of such termination.

 

Guarantee

 

18.                                 In consideration of the Shareholder entering
into this Deed at the request of the Guarantor, the Guarantor hereby
unconditionally and irrevocably guarantees to the Offeror, as primary
obligations of it:

 

(a)                                  the due
and punctual performance and observance by the Shareholder of its obligations,
commitments and undertakings under this Deed; and

 

(b)                                 if and
whenever the Shareholder shall be in default in the payment of any amount
payable under or in connection with this Deed or of any damages for breach of
the

 

7

 

same or any of the Warranties or
any other warranties, representations or undertakings contained herein after
being given notice to that effect by the Offeror, to pay to the Offeror all
such amounts that are payable by the Shareholder as though the Guarantor
instead of the Shareholder was expressed to be the principal debtor.

 

19.                                 The liability of the Guarantor under this
Deed shall not be released or diminished by any arrangements or alterations of
terms or any forbearance, neglect or delay in seeking performance of the
obligations hereby imposed or any granting of time or other indulgence for such
performance.

 

20.                                 The guarantee under paragraph 18 is to
be a continuing security to the Offeror for all obligations, commitments and
undertakings on the part of the Shareholder under this Deed. Any amount not
paid by the Shareholder and not recoverable from the Guarantor on the basis of
a guarantee (whether because of any legal limitation, disability or incapacity
on the part of the Shareholder or any other matter or thing whether known to
the Offeror or not) shall nevertheless be recoverable from the Guarantor on the
basis of an indemnity.

 

21.                                 As a separate and independent obligation, the
Guarantor undertakes, as principal obligor and not only as surety, that in the
event the Shareholder does not perform in full its obligations, commitments and
undertakings under this Deed, the Guarantor will itself then duly and
punctually perform the obligations, commitments and undertakings of the
Shareholder under this Deed as if all such obligations, commitments and
undertakings were obligations, commitments and undertakings of the Guarantor.

 

Appointment of attorney

 

22.                                 In order to secure the
performance of the Shareholder’s obligations under paragraph 3, the Shareholder
hereby irrevocably appoints any director for the time being of the Offeror to
be its attorney and agent in its name and on its behalf to execute a form or
forms of acceptance and/or such other documents and do such other acts and
things as may be necessary to accept (or procure the acceptance of) the Offers
in respect of the Relevant Shares and/or the Convertible Bonds PROVIDED THAT
such director shall only be authorised to execute such documents and perform such
actions on the Shareholder’s behalf if the Shareholder has failed to comply
with its obligations under paragraph 3.

 

Further assurance

 

23.                                 At any time after the
date of this Deed, each party shall, and shall use all reasonable endeavours to
procure that any necessary third party shall, execute such documents and do
such acts and things as any other party may reasonably require for the purpose
of giving that party the full benefit of all the provisions of this Deed in
their favour.

 

Undertaking survives

 

24.                                 The Warranties, the
warranties under paragraph 14 and all other provisions of this Deed,
insofar as the same shall not have been performed upon the Completion Date,
shall remain in full force and effect.

 

General

 

25.                                 This Deed may be executed in any number of
separate counterparts, each of which is an original but all of which together
shall constitute one and the same instrument.

 

8

 

26.                                 The failure to exercise or delay in
exercising a right or remedy provided by this Deed or by law does not impair or
constitute a waiver of the right or remedy or an impairment of a waiver of
other rights or remedies. No single or partial exercise of a right or remedy
provided under this Deed or by law prevents further exercise of the right or
remedy or the exercise of another right or remedy.

 

27.                                 If at any time any provision of this Deed is
or becomes illegal, invalid or unenforceable under the laws of any
jurisdiction, that shall not affect:

 

(a)                                  the
legality, validity or enforceability in that jurisdiction of any other
provision of this Deed; or

 

(b)                                 the
legality, validity or enforceability under the law of any other jurisdiction of
that or another provision of this Deed.

 

28.                                 Each party agrees that, if it fails to perform
or breaches any of the obligations under this Deed, damages may not be an
adequate remedy and accordingly, the parties to whom any such unperformed or
breached obligation is owed shall be entitled to the remedy of specific
performance.

 

Notices

 

29.                                 A notice or other
communication under or in connection with this Deed (a Notice)
shall be in writing; in the English language; and delivered personally or sent
by registered post (or air mail if overseas) or by fax to the party due to
receive the Notice to the address set out in paragraph 31.

 

30.                                 Unless there is
evidence that it was received earlier, a Notice is deemed given if:

 

(a)                                  delivered personally, when left at
the address referred to in paragraph 31;

 

(b)                                 sent by mail, except air mail, two
Business Days after posting it;

 

(c)                                  sent by air mail, six Business Days
after posting it; and

 

(d)                                 sent by fax, when confirmation of
its error-free transmission has been recorded by the sender’s fax machine,

 

provided
that in each case where delivery by hand or by fax occurs after 6:00 p.m.
on a Business Day or on a day which is not a Business Day, service shall be
deemed to occur at 9:00 a.m. on the next following Business Day. References
to time in this paragraph 30 are to local time in the country of the addressee.

 

31.                                 For the purposes of
paragraphs 29 and 20, Notices should be sent as follows:

 

(a)                                  in the case of the Offeror, to the
Offeror, c/o The Coca-Cola Company, NAT 456, P.O. Box 1731, Atlanta,
Georgia 30301, United States of America or on fax number 1-404-598-7791, marked
for the attention of Vice President and Director of Mergers and Acquisitions;

 

(b)                                 in the case of the Shareholder, to
the Shareholder at Scotia Centre, 4th Floor, P.O. Box 2804,
George Town, Grand Cayman, Cayman Islands or on fax number +8610 6048 9047,
marked for the attention of Mr. Zhu Xinli; and

 

9

 

(c)                                  in the case of the Guarantor, to the
Guarantor at c/o Beijing Huiyuan Beverage & Food Group Limited,
Beixiaoying Town, Shunyi District, Beijing, PRC or on fax number +8610 6048
9047.

 

Governing
law and arbitration

 

32.                                 This Deed shall be governed by and construed
in accordance with the laws of Hong Kong.

 

33.                                 Any dispute or claim arising out of or in
connection with or relating to this Deed (a Dispute),
or the interpretation, breach, termination or invalidity of this Deed including
the validity, scope and enforceability of this arbitration provision, shall be
finally resolved by arbitration in Hong Kong under the auspices of the Hong
Kong International Arbitration Centre (HKIAC) in
accordance with the UNCITRAL Arbitration Rules and the HKIAC Procedures
for the Administration of International Arbitration in force at the date of
this Deed (the UNCITRAL Arbitration Rules and the HKIAC Procedures collectively
referred to as the Arbitration Rules). There
shall be three arbitrators (the Arbitration Board).
If there are only two parties to the arbitration, each party shall appoint one
arbitrator and the two arbitrators so appointed shall appoint the third
arbitrator, who shall serve as the presiding arbitrator of the Arbitration
Board. If there are more than two parties to the arbitration, the parties shall
endeavour to agree on the procedure for appointing the arbitrators and if
within thirty (30) days of receipt of the Notice of Arbitration, the parties
have not reached an agreement on the procedure for appointing the arbitrators,
all the arbitrators shall be appointed by the HKIAC as soon as practicable upon
the receipt of a party’s request to the HKIAC. The parties shall not be limited
in their selection of arbitrators to any prescribed list; however, all
arbitrators shall be impartial and independent.

 

34.                                 The arbitration
proceedings shall be conducted and the award shall be rendered in English (with
a simultaneous translation of the proceedings into Chinese if so requested by
any party). If the Arbitration Rules are in conflict with the provisions
of this section, including the provisions concerning the appointment of
arbitrators, the provisions of this section shall prevail. The arbitrators
shall decide any Dispute submitted by the parties to the arbitration in
accordance with the governing law specified in paragraph 32. Judgment upon
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.

 

35.                                 The parties to the Dispute agree to
facilitate the arbitration by: (i) cooperating in good faith to expedite,
the conduct of the arbitration; (ii) conducting arbitration hearings to
the greatest extent possible on successive Business Days; and (iii) using
their best efforts to observe the time periods established by the Arbitration Rules or
by the Arbitration Board for the submission of evidence and briefs.

 

36.                                 In order to facilitate the comprehensive
resolution of related Disputes, all claims that arise under or in connection
with this Deed may be brought in a single arbitration. Upon the request of any party
to such arbitration, the Arbitration Board for such proceeding shall be
entitled to consolidate any arbitration proceeding constituted under this Deed
with any other arbitration proceeding constituted under this Deed,  if the Arbitration Board determines that (i) there
are issues of fact or law common to the proceedings so that a consolidated
proceeding would be more efficient than separate proceedings, and (ii) no
party would be unduly prejudiced as a result of such consolidation through
undue delay or otherwise. No such consolidation shall take place unless the
parties to all the relevant arbitrations are identical. In the event of
different rulings on consolidation by the Arbitration Board constituted
hereunder and another Arbitration Board constituted under this Deed, the ruling
of the Arbitration Board constituted first in time shall control. Such

 

10

 

Arbitration Board shall serve as the tribunal for any consolidated
arbitration, and shall have the power to make all orders consequential upon and
for the purposes of facilitating the consolidation of the arbitrations,
including orders as to costs.

 

37.                                 The costs and expenses of the arbitration,
including the fees of the Arbitration Board, shall be borne equally by each
party to the Dispute, and each party shall pay its own fees, disbursements and
other charges of its counsel; provided that the Arbitration Board shall have
the right to allocate the costs and expenses between each party as the
Arbitration Board deems equitable.

 

38.                                 The award of the Arbitration Board shall be
final and binding upon the disputing parties, and any party to the Dispute may
apply to a court of competent jurisdiction for enforcement of such award. Any
party to the Dispute shall, prior to the appointment of the Arbitration Board,
be entitled to seek preliminary injunctive relief, to prevent irreparable harm
from any court of competent jurisdiction pending the constitution of the
Arbitration Board. Without prejudice to such provisional remedies that may be
granted by a national court, the Arbitration Board shall have full authority to
grant provisional remedies, to order a party to seek modification or vacation
of an injunction issued by a national court, and to award damages for the
failure of any party to respect the Arbitration Board’s orders to that effect.

 

11

 

Yours faithfully,

 

 

	
  Executed as a deed under the Common Seal

  of CHINA HUI YUAN JUICE

  HOLDINGS CO., LTD. affixed in the

  presence of:

  	
   

  
	
   

  	
   

  
	
  /s/ Zhu Xin Li

  	
   

  
	
  Director

  	
   

  

 

 

	
  Signed, sealed and delivered by MR. ZHU

  XINLI in the presence of:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Witness

  	
   

  

 

 

AGREED AND ACCEPTED BY:

 

	
  Executed as a deed by  

  	
  Paul Etchells

  	
   

  
	
  

  as attorney for ATLANTIC INDUSTRIES

  in the presence of:

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Paul Etchells

  
	
   

  	
  Signature of attorney

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signature of Witness

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Name (print)

  	
   

  

 

12

 

SCHEDULE 1

 

DEFINITIONS

 

In this Deed:

 

Affiliate  means,
with respect to any Person, any other Person Controlling, Controlled by, or
under common Control with such Person, and with respect to an individual
Person, means that individual’s relative,
that is any spouse and any child (including adopted child and step-child), as
well as any entity which is Controlled by any of the foregoing acting singly or
together as well as such entity’s Affiliates;

 

Business Days means a day on which banks are open for the
transaction of normal banking business in Hong Kong and in the PRC (excluding
Saturday and Sunday);

 

Claim means any claim by the Offeror for a
breach of the Warranties;

 

Completion Date means the date on which the Share Offer
becomes or is declared unconditional in all respects;

 

Consideration  means HK$7,442,000,000, representing HK$12.20
per Relevant Share;

 

Control of a Person means: (i) with
respect to a corporate Person, direct or indirect ownership of more than thirty
percent of the outstanding voting securities of such corporate Person or the
ability to appoint more than one-third of the directors of the board or
equivalent governing body of such Person or the ability to direct or cause the
direction of the management and policies of such Person; (ii) with respect
to a non-corporate Person, the comparable voting interest (as set forth in (i) above)
for such non-corporate Person; (iii) the possession, direct or indirect,
of the power to direct or cause the direction of the management and policies of
a Person; or (iv) the operational or practical control of a Person; and
the terms Controls, Controlling and Controlled  shall have corresponding meanings PROVIDED THAT, in the
case of the reference to Affiliates in paragraph 5(e)(ii) only, it
means (v) with respect to a corporate Person, direct or indirect ownership
of more than fifty percent of the outstanding voting securities of such
corporate Person or the ability to appoint more than one-half of the directors
of the board or equivalent governing body of such Person or the ability to
direct or cause the direction of the management and policies of such Person; (vi) with
respect to a non-corporate Person, the comparable voting interest (as set forth
in (v) above) for such non-corporate Person; (vii) the possession,
direct or indirect, of the power to direct or cause the direction of the
management and policies of a Person; or (viii) the operational or
practical control of a Person; and the terms Controls,
Controlling and Controlled  shall, in connection with the reference to Affiliates in
paragraph 5(e)(ii) only, have corresponding meanings;

 

Convertible Bonds means the
US$6,000,000 of series A2.5 per cent. Convertible bonds due 2011 of face value
US$1,000 each issued by Huiyuan and held by the Shareholder;

 

Data Room means the electronic data room established by
Huiyuan containing certain documents and information relating to the Group
and/or the Offers virtually hosted and maintained by Merrill DataSite and
downloaded in its entirety onto duplicate CD-ROMs which have been initialed for
identification purposes by representatives of the Offeror and the Shareholder;

 

Deed of Non-Competition means the deed to be entered into on or
about the date of this Deed by the Guarantor in favor of the Offeror and
Huiyuan pursuant to which the Guarantor has undertaken that he will not, and
that he will procure that none of his Affiliates will, for a period of two
years from the Completion Date, directly or indirectly, carry on, participate
or be interested or engaged in or acquire or hold any business in the PRC which
is or may be in competition with the business

 

13

 

of Huiyuan;

 

Disclosed means fairly disclosed:

 

(A)                              in this
Deed; and

 

(B)                                in any of
the documents and information in the Data Room;

 

Encumbrance  means a mortgage, charge, pledge, lien,
option, restriction, right of first refusal, right of pre-emption, third-party
right or interest, or other encumbrance or security interest having similar
effect;

 

Executive  means the Executive Director of the Corporate
Finance Division of the SFC;

 

First Long Stop Date means the date which is 90 days after the
date of the Announcement, which date shall be automatically extended to the
date which is 200 days after the date of the Announcement if the Pre-Condition
is not satisfied before such date (or any other date as may be announced by the
Offeror and approved by the Executive and the Shareholder);

 

Governmental Authority means any national, state, municipal or
local government (including any subdivision, court, administrative agency or
commission or other authority thereof) or any quasi governmental or private
body exercising any regulatory, taxing, importing or other governmental or
quasi governmental authority in the PRC;

 

Group means Huiyuan and its subsidiaries, and member of the Group shall be
construed accordingly;

 

Group  Company means Huiyuan or a subsidiary of Huiyuan;

 

HK$ means Hong Kong dollars, the lawful currency
of Hong Kong;

 

Hong Kong means the Hong Kong Special Administrative
Region of the PRC;

 

Latest Despatch Date means the later of 21 days after the date of
the Announcement and the date which is 7 days after the Pre-Condition is
satisfied (or such later date to which the Executive, at the request of the
Offeror, may consent);

 

Listing Rules means the Rules Governing
the Listing of Securities on The Stock Exchange of Hong Kong Limited;

 

Person  means an
individual, a partnership, a corporation, an association, a joint stock
company, a trust, a joint venture, an unincorporated organisation, Governmental
Entity or any other entity;

 

PRC means the People’s Republic of China;

 

PRC Antitrust Filing means the submission of the formal
notification pursuant to The Antitrust Laws of the PRC to The Ministry of
Commerce of the PRC, Department of Treaty and Law, Antimonopoly Investigations
Office in connection with the Share Offer;

 

Pre-Condition means the pre-condition to the making of the
Share Offer as described in the Announcement;

 

Relevant Shares means 610,000,000 Shares directly or
indirectly owned by the Shareholder and representing 41.53% of Huiyuan’s entire
issued share capital as at the date of this Deed (which expression shall
include any other Shares issued after the date of this Deed and attributable to
or derived from the Relevant Shares);

 

14

 

Shares means the ordinary shares of US$0.00001 each
in the share capital of Huiyuan;

 

Supply Contract means the raw materials purchase and
recyclable containers sales agreement entered into between Huiyuan and Beijing
Huiyuan Beverage & Food Group Co., Ltd. and Beijing Huiyuan Juice &
Beverage Co., Ltd. on 31 March 2008;

 

Upstream Business means the business carried on as at the date
of this Deed by certain Affiliates of the Guarantor (but not any Group
Companies) relating to the production, supply and distribution of recyclable
containers, external packaging and raw materials for juice production; and

 

US$ means dollars of the United States of
America, the lawful currency of the United States of America.

 

15

 

SCHEDULE 2

 

WARRANTIES

 

In this Schedule 2:

 

Accounts means the audited consolidated balance
sheet, profit and loss account and cashflow statement of Huiyuan, in each case,
as at and for the period ended on the Accounts Date, together with the auditors’
reports and directors’ reports on and the notes to such accounts;

 

Accounts Date means 31 December 2007;

 

Applicable Laws means, with respect to any Person, any laws,
rules, regulations, guidelines, directives, judgments, decrees, order, notices,
rulings or decisions of any governmental or regulatory authority or stock
exchange that is applicable to such Person;

 

Intellectual Property means trade marks, internet domain names,
service marks and all rights in trade, business and company names including
(insofar as the foregoing rights are obtainable by registration) applications
for registration of the Group Companies;

 

Intellectual Property
Rights means all
Intellectual Property owned or used by any Group Company in or in connection
with its business; and

 

Tax  means any form of taxation and any levy,
duty, charge, contribution, withholding or impost in the nature of taxation
(including any related fine, penalty, or interest) imposed, collected or
assessed by, or payable to a Tax Authority; and Tax
Authority means any government, state or municipality or any
local, state, federal or other authority, body or official anywhere in the
world exercising a fiscal, revenue, customs or excise function.

 

In this Schedule 2, a
reference to “so far as the Shareholder is aware”
or any similar reference shall include the knowledge of the Guarantor.

 

PART A

 

1              RELEVANT
SHARES AND CONVERTIBLE BONDS

 

1.1           Save as Disclosed, the Shareholder is entitled to sell
and transfer, or procure the sale and transfer of, the full legal and beneficial
ownership of the Relevant Shares and the Convertible Bonds to the Offeror
pursuant to and in accordance with the terms and conditions of the Share Offer
and the Convertible Bond Offer, free from Encumbrances and with all rights
attaching thereto as at the date of the Offers (including the right to all
dividends, and other distributions, if any, declared, made or paid after the
date of the Announcement) and thereafter.

 

1.2           The Relevant Shares have
been validly allotted and issued and are fully paid or credited as fully paid
and are all the Shares legally or beneficially owned by the Shareholder.

 

1.3           Other than as Disclosed,
neither the Shareholder nor any of its Affiliates has any interest in any
securities of Huiyuan or any rights to subscribe for, purchase or otherwise
acquire any such securities.

 

1.4           The Shareholder is the
registered holder and beneficial owner of the Convertible Bonds.

 

PART B

 

2.             CAPACITY AND AUTHORITY OF SHAREHOLDER

 

16

 

2.1                                 The
Shareholder:

 

(A)                              has been
duly incorporated and constituted, and is legally subsisting under the laws of
its place of incorporation;

 

(B)                                has the
requisite power and authority to enter into, and to perform its obligations
under, this Deed; and

 

(C)                                has
obtained or satisfied all corporate, regulatory and other approvals, and any
other conditions, necessary to execute and perform its obligations under this
Deed.

 

2.2                                 The
execution and delivery by the Shareholder of this Deed, and the performance and
completion of this Deed by the Shareholder:

 

(A)                              subject to
satisfaction of the Pre-Condition, will not infringe any Applicable Laws;

 

(B)                                will not
result in any breach of the terms of, or constitute a default under, its
constitutional documents or any instrument, agreement or governmental,
regulatory or other judgment, decree or order to which the Shareholder is a
party or by which it is bound; and

 

(C)                                will not
conflict with any of its certificates, licences or permits that enable it to
carry on the business or operations operated by it.

 

2.3                                 This Deed
constitutes legal, valid and binding obligations of the Shareholder enforceable
in accordance with its terms.

 

3.                                      CHANGES SINCE
THE ACCOUNTS DATE

 

3.1                                 Since the
Accounts Date:

 

(A)                              no Group
Company has, save as Disclosed, created, allotted, issued, acquired, repaid or redeemed
any share or loan capital (or made any agreement or arrangement or undertaken
any obligation to do any of those things);

 

(B)                                there has
been no material adverse change in the turnover, or the financial or trading
position, of any Group Company which would be material in the context of the
Group taken as a whole;

 

(C)                                no Group
Company has entered into any material contract outside the ordinary course of
business consistent with past practice;

 

(D)                               no Group
Company has declared or paid any dividend or made any distribution of assets,
capital or profits; and

 

(E)                                 other than
in the ordinary course of its business and on arm’s length terms, no Group
Company has acquired or disposed of, or agreed to acquire or dispose of, an
asset of a value in excess of HK$50 million.

 

4.                                      INFORMATION

 

The Shareholder is not aware of any
unpublished information relating to the affairs, business or property of
Huiyuan or any Group Company which has or which might reasonably be expected to
have a materially adverse effect on the future profitability of the Group taken
as a whole, or has or might reasonably be expected to have a material adverse

 

17

 

effect on the net asset value of
the Group taken as a whole, in each case when compared to the position of the
Group as at the Accounts Date.

 

5.                                      INTELLECTUAL
PROPERTY

 

5.1                                 The
Intellectual Properties Disclosed are all the material Intellectual Properties
of the Group.

 

5.2                                 The
Intellectual Properties used by or in connection with the business of the Group
are Intellectual Properties which a Group Company is the registered owner or
applicant for registration. Such Intellectual Properties are owned by the
relevant Group Company free of any Encumbrances.

 

5.3                                 Except as
Disclosed, no Group Company has granted or is obliged to grant a licence,
assignment or security interest in respect of any of the material Intellectual
Property Rights referred to in paragraphs 5.1 and 5.2.

 

6.                                      PROPERTY

 

6.1                                 All
properties Disclosed and/or used by or in connection with facilities Disclosed
(the Properties) comprise all of the land
and premises vested in, occupied or used by, or in the possession, of the Group
Companies.

 

6.2                                 A Group
Company either possesses good and unencumbered land use rights over, or good
marketable title to, or has a valid and legal right to use, all the Properties.

 

7.                                      LICENCES AND
CONSENTS

 

7.1                                 Save as
Disclosed, all material licences, consents and other permissions and approvals
required for or in connection with the carrying on of the business now being
carried on by each Group Company, including business licences, industrial
production permits, sanitation permits and waste discharge permits (Licences):

 

(A)                              have been
obtained and are in full force and effect; and

 

(B)                                except as
Disclosed, are not limited in duration or subject to onerous conditions.

 

7.2                                 All
reports, returns or information required by law or as a condition of any
Licences to be made or given to any Person or authority in connection with the
business of any Group Company have been made or given to the appropriate Person
or authority.

 

7.3                                 There is
no circumstance which indicates that any Licences may be varied, revoked or not
renewed, or which may confer a right of variation or revocation.

 

8.                                      COMPLIANCE
WITH LAWS

 

Each
Group Company is carrying on its business and operations so that there have
been no breaches of Applicable Laws (including Applicable Laws in relation to
Tax) in any material respect which has had or is reasonably likely to have a
material adverse effect upon its assets or business.

 

9.                                      ENVIRONMENTAL

 

9.1                                 For the
purpose of this paragraph 9, the following terms shall have the following
meanings:

 

18

 

Environmental Law means all or any laws, and any relevant code
of practice, guidance, note, standard or other advisory material issued by any
Governmental Authority which from time to time relates to the protection of
human health or the environment or natural resources or the conditions of the
workplace or the generation, use, management, transportation, storage,
treatment or disposal of Hazardous Material;

 

Environmental Permits means all authorisations or agreements
required under Environmental Law in relation to the carrying on of the business
of any member of the Group or the occupation or use of the Properties or Former
Properties;

 

Former Properties means any land or premises or interest
formerly owned or occupied by any member of the Group;

 

Hazardous Material means any pollutant, or any hazardous,
toxic, radioactive, noxious, corrosive or caustic substance (whether in solid,
liquid or gaseous form) which alone or in combination with others is capable of
causing harm to the environment; and

 

Waste includes any unwanted or surplus substance irrespective of whether it
is capable of being recycled or recovered or has any value.

 

9.2                                 Each
member of the Group has complied in all material respects with applicable
Environmental Law.

 

9.3                                 Save as
Disclosed, each member of the Group has obtained all necessary Environmental
Permits (all of which are valid and subsisting) and each member of the Group
has complied in all material respects with all terms, conditions and
limitations in all Environmental Permits.

 

9.4                                 No
Environmental Permit may be revoked, modified or suspended as a result of the
acquisition by the Offeror of the Relevant Shares pursuant to the Share Offer.

 

9.5                                 No
circumstance exists, nor so far as the Shareholder is aware is likely to arise,
which could make it impossible, difficult or require material expenditure
(other than in the normal course of business consistent with past practices)
for the Group to comply with the conditions or limitations in any Environmental
Permits in the future or may result in any such Environmental Permits in the
future not being extended, renewed, granted or (where necessary) transferred
and no member of the Group has received any communication revoking, suspending,
alleging non-compliance, modifying or varying any of the Environmental Permits
or is not aware of any circumstances which might give rise to any such
communication being received.

 

9.6                                 No member
of the Group is engaged in any litigation, arbitration, administrative or
criminal proceedings or negotiations with any Person or Governmental Authority
relating to Environmental Law or its enforcement and (so far as the Shareholder
is aware) no litigation, arbitration, administrative or criminal proceedings or
negotiations with any Person or Governmental Authority relating to any actual
or potential liability under or non-compliance with Environmental Law are
pending, threatened or envisaged by or against any member of the Group.

 

9.7                                 So far as
the Shareholder is aware, there are no Hazardous Materials present at, on, in
or under the Properties save where stored or used in full compliance with
Environmental Law.

 

9.8                                 No member
of the Group is responsible (wholly or in part) for any clean up or other
corrective action in relation to any Properties or Former Properties or
activities or

 

19

 

operations undertaken or formerly
undertaken by a member of the Group and is not subject to any investigation or
inquiry by any Governmental Authority and has not received any communication
regarding clean up of any Properties or Former Properties.

 

9.9                                 All
reports resulting from all environmental or health and safety investigations,
audits, appraisals, policies or assessments undertaken or commissioned by a
member of the Group relating to a member of the Group’s operations, plant,
equipment, Properties or Former Properties have been provided to the Offeror
and, so far as the Shareholder is aware, any such investigation, audit or
appraisal or assessment was carried out competently and the contents of any
such reports are correct in all material respects, do not contain material
omissions and where recommendations have been made, these have been complied
with in all material respects.

 

10.                               PRODUCT LIABILITY

 

10.1                           There is no material claim in respect
of Product Liability outstanding or (so far as the Shareholder is aware)
threatened against or expected by the Group in relation to its business and (so
far as the Shareholder is aware) there are no circumstances which are likely to
give rise to any such claim. For this purpose, Product
Liability means a liability arising out of death, personal
injury or damage to property caused by a defective product or defective
services sold, supplied or provided by any member of the Group in the course of
its business on or prior to the date of this Deed.

 

10.2                           So far as
the Shareholder is aware, no member of the Group has manufactured, sold
or supplied any product or service, a significant portion of which:

 

(A)          is, was or will become, in any material
respect, faulty or defective;

 

(B)          does not comply in any material respect with
any warranty or representation, express or implied, made by or on behalf of any
member of the Group in respect of it or with all Applicable Laws; or

 

(C)          was sold or supplied on terms that any member
of the Group accepts an obligation to service or repair or replace such
products after delivery.

 

11.                               LITIGATION

 

11.1                           No Group Company is engaged
in any capacity in any significant litigation, arbitration, prosecution or
other legal proceedings, which has had or is reasonably likely to have, in each
case, a material adverse effect to the Group involving an amount in excess of
HK$5 million.

 

11.2                           There is no outstanding
judgment, order, decree, arbitral award or decision of a court, tribunal,
arbitrator or governmental agency against any Group Company, which has had or
is reasonably likely to have, in each case, a material adverse effect to the
Group involving an amount in excess of HK$5 million.

 

12.                               CONSEQUENCES OF THE OFFERS

 

12.1                           The completion of the Offers will
not:

 

(A)                              cause any member of the Group to lose the
benefit of any licence, consent, permit, approval or authorisation (public or
private) or any right or privilege it presently enjoys or relieve any Person of
any obligation to any member of the Group (whether contractual or otherwise) or
enable any Person to determine any such

 

20

 

obligation
or any contractual right or benefit now enjoyed by any member of the Group or
to exercise any right whether under an agreement with any member of the Group
or otherwise;

 

(B)                                save in respect of those loan facilities of
the Group that have been Disclosed, result in any present or future
indebtedness of any member of the Group becoming due or capable of being
declared due and payable prior to its stated maturity;

 

(C)                                save as Disclosed, give rise to or cause to
become exercisable any right of pre-emption;

 

(D)                               result in a breach of, or constitute a
default under, any provision of the memorandum or articles of association or
other constitutional documents of any member of the Group;

 

(E)                                 result in a breach of, or constitute a
default under any order, judgment or decree of any Governmental Authority by
which any member of the Group is bound or subject; or

 

(F)                                 save in respect of those loan facilities of
the Group that have been Disclosed, result in a breach of, or constitute a
default under the terms, conditions or provisions of any agreement,
understanding, arrangement or instrument (including, but not limited to, any of
any member of the Group’s contracts).

 

21

 

SCHEDULE 3

 

ANNOUNCEMENT

 

22Exhibit 10.2

 

Execution Version

 

IRREVOCABLE
UNDERTAKING

 

	
  To:

  	
  Atlantic
  Industries (the Offeror)

  
	
   

  	
  PO Box 309GT

  
	
   

  	
  Ugland House

  
	
   

  	
  South Church
  Street

  
	
   

  	
  George Town

  
	
   

  	
  Grand Cayman

  
	
   

  	
  Cayman Islands

  
	
   

  	
   

  
	
  From:

  	
  Danone Asia
  Pte. Ltd (the Shareholder)

  
	
   

  	
  3 Church Street

  
	
   

  	
  08-01

  
	
   

  	
  Samsung Hub

  
	
   

  	
  Singapore
  04948310

  
	
   

  	
   

  
	
   

  	
  Group Danone
  S.A. (the Guarantor)

  
	
   

  	
  17 Boulevard
  Haussmann

  
	
   

  	
  75009 Paris

  
	
   

  	
  France

  

 

31 August 2008

 

Dear Sirs,

 

Offer
for China Huiyuan Juice Group Limited (Huiyuan)

 

The Shareholder
understands that an offer is to be made by or on behalf of the Offeror to
acquire all the issued ordinary shares of Huiyuan (the Share
Offer), to acquire all the outstanding convertible bonds of
Huiyuan (the Convertible Bond Offer) and
to cancel all the outstanding share options of Huiyuan (the Option Offer and, together with the
Share Offer and the Convertible Bond Offer, the Offers),
substantially on the terms of the draft announcement attached as Schedule 2 to
this letter agreement (the Announcement)
or on such other terms as may be agreed between the Offeror and Huiyuan or as
may be required to comply with the requirements of the Securities and Futures
Commission of Hong Kong (the SFC), the
Hong Kong Code on Takeovers and Mergers (the Code),
The Stock Exchange of Hong Kong Limited (the Stock
Exchange) or the Rules Governing the Listing of Securities
on the Stock Exchange (the Listing Rules).  This letter agreement sets out the terms and
conditions on which the Shareholder will accept the Share Offer when it is made
and sets out certain undertakings to be given by the Offeror to the
Shareholder.  The Guarantor has agreed to
guarantee the performance by the Shareholder of its obligations under this
letter agreement.

 

A reference in
this letter agreement to the Offers, the Share Offer, the Convertible Bond Offer or the Option Offer  also includes any new,
increased, renewed or revised offers made by or on behalf of the Offeror to
acquire shares in Huiyuan, to acquire the outstanding convertible bonds of
Huiyuan or to cancel the share options of Huiyuan, as the case may be provided
that the terms of such offers are no less favourable to acceptors than the
terms set out in the Announcement.

 

Terms defined in
Schedule 1 hereto shall have the same meaning in this letter agreement.

 

1

 

Warranties

 

1.                                      The Shareholder
warrants to the Offeror, as at the date of this letter agreement and the date
the Share Offer becomes or is declared unconditional in all respects, by
reference to the facts and circumstances existing as at such dates
respectively, that:

 

(a)                                 it shall be entitled to sell and transfer, or procure the
sale and transfer of, the full legal and beneficial ownership of the Relevant
Shares to the Offeror pursuant to and in accordance with the terms and
conditions of the Share Offer, free from Encumbrances and with all rights
attaching thereto as at the date of the Share Offer (including the right to all
dividends, and other distributions, declared, made or paid after the date of
the Announcement) and thereafter;

 

(b)                                the Relevant Shares have been validly allotted and issued and
are fully paid or credited as fully paid and are all the Shares legally or
beneficially owned by the Shareholder free from Encumbrances;

 

(c)                                 other than as set out in this paragraph 1, neither it
nor any of its Associates (as defined in the Listing Rules) has any interest in
any securities of Huiyuan or any rights to subscribe for, purchase or otherwise
acquire any such securities;

 

(d)                                it has, subject to satisfaction of the Pre-Condition,
obtained or satisfied all corporate, regulatory and other approvals, and any
other conditions, necessary to execute and perform its obligations under this
letter agreement;

 

(e)                                 the execution and delivery by it of this letter agreement,
and the performance and completion of this letter agreement by it:

 

(i)                                    subject to satisfaction of the Pre-Condition, will not
infringe any applicable laws;

 

(ii)                                 will not result in any breach of the terms of, or constitute
a default under, its constitutional documents or any instrument, agreement or
governmental, regulatory or other judgment, decree or order to which it is a
party or by which it is bound; and

 

(iii)                              will not conflict with any of its certificates, licences or
permits that enable it to carry on the business or operations operated by it;
and

 

(f)                                   this letter agreement constitutes legal, valid and binding
obligations of it enforceable in accordance with its terms.

 

2.                                      The Guarantor
warrants to the Offeror, as at the date of this letter agreement and the date
the Share Offer becomes or is declared unconditional in all respects, by
reference to the facts and circumstances existing as at such dates
respectively, that:

 

(a)                                 it has, subject to satisfaction of the Pre-Condition,
obtained or satisfied all corporate, regulatory and other approvals, and any
other conditions, necessary to execute and perform its obligations under this
letter agreement; and

 

(b)                                the execution and delivery by it of this letter agreement,
and the performance and completion of this letter agreement by it:

 

(i)                                    will not, subject to satisfaction of the Pre-Condition,
infringe any applicable laws;

 

2

 

(ii)                                 will not result in any breach of the terms of, or constitute
a default under, its constitutional documents or any instrument, agreement or
governmental, regulatory or other judgment, decree or order to which it is a
party or by which it is bound; and

 

(iii)                              will not conflict with any of its certificates, licences or
permits that enable it to carry on the business or operations operated by it;
and

 

(c)                                 this letter agreement constitutes legal, valid and binding
obligations of it enforceable in accordance with its terms.

 

3.                                      Each of the
Shareholder and the Guarantor acknowledges that the Offeror has entered into
this letter agreement in reliance upon the warranties in paragraphs 1 and
2.

 

Dealings
and undertakings

 

4.                                      The Shareholder
undertakes to the Offeror that before the Share Offer closes, lapses or is
withdrawn, it shall not:

 

(a)                                 sell, transfer, Encumber, or otherwise dispose of any
interest in any Relevant Shares, other than pursuant to its acceptance of the
Share Offer;

 

(b)                                accept any other offer in respect of the Relevant Shares;

 

(c)                                 vote in favour of any resolution to approve any scheme of
arrangement of Huiyuan which is proposed in competition with the Share Offer;
or

 

(d)                                acquire, and shall not permit any person acting in concert
with it, to acquire any Shares or any warrants, options, subscription rights or
other rights to subscribe for, acquire or convert into such Shares or any
interest therein or agree to do so without the prior written consent of the
Offeror.

 

Undertaking to accept the
Offers

 

5.                                      In
consideration of the Offeror’s undertakings in paragraph 7, the Shareholder
undertakes to the Offeror that it:

 

(a)                                 shall accept the Share Offer in respect of the Relevant
Shares in accordance with the procedure for acceptance set out in the formal
offer document to be issued by or on behalf of the Offeror and Huiyuan in
connection with the Offers (Composite Document)
not later than seven days after the Offeror posts the Composite Document to
Huiyuan shareholders;

 

(b)                                shall use its reasonable efforts to cause HKSCC Nominee
Limited (HKSCC) to accept the Share
Offer in accordance with the procedure for acceptance set out in the Composite
Document not later than seven days after the Offeror posts the Composite
Document;

 

(c)                                 shall not withdraw any acceptances of the Share Offer and
will use its reasonable efforts to cause HKSCC not to do so; and

 

(d)                                shall sell the Relevant Shares free of any Encumbrance and
together with all rights of any nature attaching to those Shares, including the
right to all dividends, and other distributions, declared, made or paid on or
after the date of the Announcement.

 

3

 

Documentation

 

6.                                      The Shareholder
and the Guarantor consent to:

 

(a)                                 this letter agreement being disclosed to the SFC and the
Stock Exchange;

 

(b)                                the inclusion of references to them, and particulars of this
letter agreement and their respective holdings of relevant securities of
Huiyuan being included in the Announcement and the Composite Document; and

 

(c)                                 this letter agreement being made available for inspection as
required by Note 1 to Rule 8 of the Code or the Listing Rules.

 

Offeror’s undertakings

 

7.                                      The Offeror
agrees with the Shareholder that:

 

(a)                                 it will make the Offers in accordance with the Announcement
and the Announcement will be released substantially in the form attached (or in
such other form as may be agreed between the Offeror and the Shareholder or as
may be required to comply with the requirements of the SFC or the Stock
Exchange) within ten Business Days of the date of this letter agreement (or
such later date as the Offeror and the Shareholder may agree);

 

(b)                                it shall, at its own cost, use all reasonable efforts to
ensure that the Pre-Condition is fulfilled promptly after the date of the
Announcement, and in any event, no later than the First Long Stop Date;

 

(c)                                 without prejudice to the generality of paragraph 7(b) above,
it shall initiate contact with the relevant Governmental Authority relating to
the satisfaction of the Pre-Condition within seven days of the date of the
Announcement with a view to making the PRC
Antitrust Filing within 20 days of the date of the Announcement; and

 

(d)                                it shall not announce a change to the initial First Long Stop
Date without the prior consent of the Shareholder.

 

8.                                      Each party
shall regularly review with the other parties and their advisers the progress
of any notifications or filings submitted in order to satisfy the Pre-Condition
with a view to obtaining clearance from any Governmental Authority at the
earliest reasonable opportunity and, in particular, the Offeror shall inform
the Shareholder and the Guarantor within two Business Days of it submitting any
notification or filing, receiving any response from any Governmental Authority
or engaging in any material communications with any Governmental Authority (in
each case, in connection with the Pre-Condition), together with a brief summary
of such notification, filing, response or communication.

 

Termination

 

9.                                      This letter
agreement shall automatically terminate if:

 

(a)                                 the Announcement is not released within ten Business Days of
the date of this letter agreement (or such later date as the Offeror, Huiyuan
and the Shareholder may agree);

 

4

 

(b)                                the Offers are not made (by posting of the Composite
Document) by the Latest Despatch Date;

 

(c)                                 the Offers include any material terms or are subject to any
conditions other than those set out in the draft of the Announcement; or

 

(d)                                the Share Offer lapses or is withdrawn.

 

10.                                Termination of
this letter agreement shall be without prejudice to a party’s accrued rights
and remedies, obligations and liabilities under this letter agreement as at the
date of such termination.

 

Guarantee

 

11.                                In
consideration of the Shareholder entering into this letter agreement at the
request of the Guarantor, the Guarantor hereby unconditionally and irrevocably
guarantees to the Offeror, as primary obligations of it:

 

(a)                                 the due and punctual performance and observance by the
Shareholder of its obligations, commitments and undertakings under this letter
agreement;  and

 

(b)                                if and whenever the Shareholder shall be in default in the
payment of any amount payable under or in connection with this letter agreement
or of any damages for breach of the same or any of the Warranties or any other
warranties, representations or undertakings contained herein after being given
notice to that effect by the Offeror, to pay to the Offeror all such amounts
that are payable by the Shareholder as though the Guarantor instead of the
Shareholder was expressed to be the principal debtor.

 

12.                                The liability
of the Guarantor under this letter agreement shall not be released or
diminished by any arrangements or alterations of terms or any forbearance,
neglect or delay in seeking performance of the obligations hereby imposed or
any granting of time or other indulgence for such performance.

 

13.                                The guarantee
under paragraph 11 is to be a continuing security to the Offeror for all
obligations, commitments and undertakings on the part of the Shareholder under
this letter agreement.  Any amount not
paid by the Shareholder and not recoverable from the Guarantor on the basis of
a guarantee (whether because of any legal limitation, disability or incapacity
on the part of the Shareholder or any other matter or thing whether known to
the Offeror or not) shall nevertheless be recoverable from the Guarantor on the
basis of an indemnity.

 

14.                                As a separate
and independent obligation, the Guarantor undertakes, as principal obligor and
not only as surety, that in the event, the Shareholder does not perform in full
its obligations, commitments and undertakings under this letter agreement, the
Guarantor will itself then duly and punctually perform the obligations,
commitments and undertakings of the Shareholder under this letter agreement as
if all such obligations, commitments and undertakings were obligations,
commitments and undertakings of the Guarantor.

 

Appointment of attorney

 

15.                                In order to
secure the performance of the Shareholder’s obligations under paragraph 5, the
Shareholder hereby irrevocably appoints any director for the time being of the
Offeror to be its attorney and/or agent in its name and on its behalf to
execute a form or forms of acceptance and/or such other documents and do such
other acts and things as may be 

 

5

 

necessary to accept (or
procure the acceptance of) the Share Offer in respect of the Relevant Shares
PROVIDED THAT such director shall only be authorised to execute such documents
and perform such actions on the Shareholder’s behalf if the Shareholder has
failed to comply with its obligations under paragraph 5.

 

Further assurance

 

16.                                At any time
after the date of this letter agreement, each party shall, and shall use all
reasonable endeavours to procure that any necessary third party shall, execute
such documents and do such acts and things as any other party may reasonably
require for the purpose of giving that party the full benefit of all the
provisions of this letter agreement in their favour.

 

Undertaking survives

 

17.                                The warranties
under paragraphs 1 and 2 and all other provisions of this letter
agreement, insofar as the same shall not have been performed upon the Share
Offer becoming, or being declared to be, unconditional shall remain in full
force and effect.

 

General

 

18.                                This letter
agreement may be executed in any number of separate counterparts, each of which
is an original but all of which together shall constitute one and the same
instrument.

 

19.                                The failure to
exercise or delay in exercising a right or remedy provided by this letter
agreement or by law does not impair or constitute a waiver of the right or
remedy or an impairment of a waiver of other rights or remedies.  No single or partial exercise of a right or
remedy provided under this letter agreement or by law prevents further exercise
of the right or remedy or the exercise of another right or remedy.

 

20.                                If at any time
any provision of this letter agreement is or becomes illegal, invalid or
unenforceable under the laws of any jurisdiction, that shall not affect:

 

(a)                                 the legality, validity or enforceability in that jurisdiction
of any other provision of this letter agreement; or

 

(b)                                the legality, validity or enforceability under the law of any
other jurisdiction of that or another provision of this letter agreement.

 

21.                                Each party
agrees that, if it fails to perform or breaches any of the obligations under
this letter agreement, damages may not be an adequate remedy and accordingly,
the parties to whom any such unperformed or breached obligation is owed shall
be entitled to the remedy of specific performance.

 

Governing law and jurisdiction

 

22.                                This letter
agreement shall be governed by and construed in accordance with law of Hong
Kong and each of the Shareholder, the Guarantor and the Offeror each submit to
the exclusive jurisdiction of the courts of Hong Kong for all purposes in
connection with this letter agreement.

 

23.                                Process by
which any proceedings are begun may be served on the Offeror by being served on
The Coca-Cola Export Corporation at 38 Floor, Shell Tower, Times Square, 1
Matheson Street, Causeway Bay, Hong Kong, marked for the attention of the
General Counsel, Pacific Group, with a copy to be sent to the Offeror on fax
number 1-404-598-7791, 

 

6

 

marked for the attention of
the Vice President and Director of Mergers and Acquisitions.

 

24.                                Process by
which any proceedings are begun may be served on the Shareholder and/or the
Guarantor by being served on Asia Host Investment Ltd at Room 1905, Metropole
Square, 2 On Yiu Street, Shatin, New Territories, Hong Kong, with a copy to be
sent to the Shareholder on fax number +86 21 5298 6800, marked for the
attention of General Counsel Asia Pacific.

 

7

 

	
  Yours faithfully,

  	
   

  
	
   

  	
   

  
	
  /s/ David Flaveau

  	
   

  
	
  For and on
  behalf of

  	
   

  
	
  DANONE
  ASIA PTE. LTD

  	
   

  
	
   

  	
   

  
	
  Name: David Flaveau

  	
   

  
	
   

  	
   

  
	
  Title: Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  For and on
  behalf of

  	
   

  
	
  GROUP
  DANONE S.A.

  	
   

  
	
   

  	
   

  
	
  Name:

  	
   

  
	
   

  	
   

  
	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  AGREED AND ACCEPTED BY:

  	
   

  
	
   

  	
   

  
	
  /s/ Paul Etchells

  	
   

  
	
  For and on
  behalf of

  	
   

  
	
  ATLANTIC
  INDUSTRIES

  	
   

  
	
   

  	
   

  
	
  Name: Paul Etchells

  	
   

  
	
   

  	
   

  
	
  Title: Authorized Attorney

  	
   

  

 

8

 

SCHEDULE 1

 

DEFINITIONS

 

In this letter agreement:

 

Business Days  means a day on which banks are open
for the transaction of normal banking business in Hong Kong and in the PRC
(excluding Saturday and Sunday);

 

Encumbrance  means a mortgage, charge, pledge,
lien, option, restriction, right of first refusal, right of pre-emption,
third-party right or interest, or other encumbrance or security interest having
similar effect;

 

Executive  means the Executive Director of
the Corporate Finance Division of the SFC;

 

First Long Stop Date means the date which is 90 days
after the date of the Announcement, which date shall be automatically extended
to the date which is 200 days after the date of the Announcement if the
Pre-Condition is not satisfied before such date (or any other date as may be
announced by the Offeror and approved by the Executive and the Shareholder);

 

Governmental Authority means any national, state,
municipal or local government (including any subdivision, court, administrative
agency or commission or other authority thereof) or any quasi governmental or
private body exercising any regulatory, taxing, importing or other governmental
or quasi governmental authority in the PRC;

 

Hong Kong means the Hong Kong Special
Administrative Region of the PRC;

 

Latest Despatch Date means the later of 21 days after
the date of the Announcement and the date which is 7 days after the
Pre-Condition is satisfied (or such later date to which the Executive, at the
request of the Offeror, may consent);

 

PRC means the People’s Republic of
China;

 

PRC Antitrust Filing means the submission of the
formal notification pursuant to The Antitrust Laws of the PRC to The Ministry
of Commerce of the PRC, Department of Treaty and Law, Antimonopoly
Investigations Office in connection with the Share Offer;

 

Pre-Condition means the pre-condition to the
making of the Share Offer as described in the Announcement;

 

Relevant Shares means 337,497,501 Shares directly
or indirectly owned by the Shareholder and representing 22.98% of the Company’s
entire issued share capital as at the date of this letter agreement (which
expression shall include any other Shares issued after the date of this letter
agreement and attributable to or derived from the Relevant Shares); and

 

Shares means the ordinary shares of
US$0.00001 each in the share capital of Huiyuan.

 

9

 

SCHEDULE 2

 

ANNOUNCEMENT

 

10

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