Exhibit 10.2

 

FORM OF REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made and entered into
as of ______ __, 2015, between Kingold Jewelry, Inc., a company duly
incorporated and existing under the laws of Delaware (the “Company”), and
Fidelidade – Companhia de Seguros, S.A., a company duly incorporated and
existing under the laws of Portugal (the “Holder”).

 

In connection with the Convertible Note Purchase Agreement, dated as of April 2,
2015, entered into by the Company and the Holder (the “Purchase Agreement”), the
Company has agreed, upon the terms and subject to the conditions of the Purchase
Agreement, to issue and sell to the Holder a note of the Company (the “Note”),
which will, among other things, be convertible into shares of the Company's
common stock, $0.001 par value per share (the “Common Stock”) to the Holder (as
converted, the “Conversion Shares”) in accordance with the terms of the Purchase
Agreement and the Note.

 

To induce the Holder to consummate the transactions contemplated by the Purchase
Agreement, the Company has agreed to provide certain registration rights under
the Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor statute (collectively, the “1933 Act”), and
applicable state securities laws.

 

The Company and the Holder hereby agrees as follows:

 

Section 1.                Definitions. Capitalized terms used and not otherwise
defined herein that are defined in the Purchase Agreement shall have the
meanings given such terms in the Purchase Agreement. As used in this Agreement,
the following terms shall have the following meanings:

 

“Initial Registration Statement” means the initial Registration Statement filed
pursuant to this Agreement.

 

“Person” means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited
liability company or government or other entity.

 

“Prospectus” means the prospectus included in a Registration Statement
(including, without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated by the SEC pursuant to the 1933
Act), as amended or supplemented by any prospectus supplement, with respect to
the terms of the offering of any portion of the Registrable Securities covered
by a Registration Statement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.

 

“Effectiveness Deadline” means, (i) with respect to the Initial Registration
Statement required to be filed hereunder, the earlier of (A) the 90th calendar
day after the date of the issuance of the Note (or the 180th calendar day after
such date in the event that such Registration Statement is subject to review by
the SEC) and (B) the fifth Trading Day after the date the Company is notified
(orally or in writing, whichever is earlier) by the SEC that such Registration
Statement will not be reviewed or will not be subject to further review, and
(ii) with respect to any additional Registration Statements which may be
required pursuant to Section 2, the earlier of (A) the 90th calendar day
following the date on which an additional Registration Statement is required to
be filed hereunder (or the 180th calendar day after the date hereof in the event
that such Registration Statement is subject to review by the SEC) and (B) the
fifth Trading Day after the date the Company is notified (orally or in writing,
whichever is earlier) by the SEC that such Registration Statement will not be
reviewed or will not be subject to further review.

 

 

 

 

“Filing Deadline” means, with respect to the Initial Registration Statement
required hereunder, the 60th calendar day following the date of the issuance of
the Note and, with respect to any additional Registration Statements which may
be required pursuant to Section 2, the earliest practical date on which the
Company is permitted to file such additional Registration Statement related to
the Registrable Securities (taking into account any Staff position with respect
to date on which the Staff will permit such additional Registration Statement to
be filed with the SEC).

 

“Registrable Securities” means, as of any date of determination, (a) all
Conversion Shares then issuable upon conversion in full of the Note (assuming on
such date the Note is converted in full without regard to any conversion
limitations therein), and (b) any securities issued or then issuable upon any
stock split, dividend or other distribution, recapitalization or similar event
with respect to the foregoing; provided, however, that any such Registrable
Securities shall cease to be Registrable Securities for so long as (x) a
Registration Statement with respect to the sale of such Registrable Securities
is declared effective by the SEC under the 1933 Act and such Registrable
Securities have been disposed of in accordance with such effective Registration
Statement, or (y) such Registrable Securities are able to be sold without
restriction pursuant to Rule 144 (including, without limitation, volume
restrictions) and without the need for current public information required by
Rule 144(c)(1) (or Rule 144(i)(2), if applicable).

 

“Registration Statement” means any registration statement required to be filed
hereunder pursuant to Section 2, including (in each case) the Prospectus,
amendments and supplements to any such registration statement or Prospectus,
including pre- and post-effective amendments, all exhibits thereto, and all
material incorporated by reference or deemed to be incorporated by reference in
any such registration statement.

 

“Rule 144” means Rule 144 promulgated by the SEC pursuant to the 1933 Act, as
such rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC having substantially the same effect as such rule.

 

“Rule 415” means Rule 415 promulgated by the SEC pursuant to the 1933 Act, as
such Rule may be amended or interpreted from time to time, or any similar rule
or regulation hereafter adopted by the SEC having substantially the same purpose
and effect as such Rule.

 

 

 

 

“SEC” means the United States Securities and Exchange Commission.

 

Section 2.                Registration Statement Requirements.

 

(a)                The Company shall prepare and, as soon as practicable, but in
no event later than the Filing Deadline, file with the SEC the Initial
Registration Statement on Form S-3, or such other form reasonably acceptable to
the Holder, covering the resale by the Holder of all or such portion of the
Registrable Securities (as determined on the date of such filing and the
effective date of such Registration Statement, as applicable) as permitted by
the SEC (provided that the Company shall use reasonably diligent efforts to
advocate with the SEC for the registration of all of the Registrable Securities)
pursuant to Rule 415. In no event shall the Company include any securities other
than Registrable Securities on any Registration Statement pursuant to this
Section 2 without the prior written consent of the Holder. The Company shall use
its reasonable best efforts to have such Initial Registration Statement, and
each other Registration Statement required to be filed pursuant to the terms
hereof, declared effective by the SEC as soon as practicable, but in no event
later than the applicable Effectiveness Deadline. If at any time all Registrable
Securities are not covered by the Initial Registration Statement filed pursuant
to this Section 2, the Company shall file with the SEC one or more additional
Registration Statements so as to cover all of the Registrable Securities not
covered by the Initial Registration Statement, in each case, as soon as
practicable (taking into account any Staff position with respect to date on
which the Staff will permit such additional Registration Statement(s) to be
filed with the SEC), but in no event later than the applicable Filing Deadline
for such additional Registration Statement(s). By 9:30 a.m. New York time on the
Business Day following the effective date of each Registration Statement filed
in accordance herewith, the Company shall file with the SEC in accordance with
Rule 424 under the 1933 Act the final prospectus to be used in connection with
sales pursuant to such Initial Registration Statement. The Company shall not be
required to keep such Registration Statements filed in connection herewith
effective (and the prospectus contained therein available for use) after the
earlier of (i) the date as of which the Holder may sell all of the Registrable
Securities required to be covered by such Registration Statement without
restriction pursuant to Rule 144 (including, without limitation, volume
restrictions) and without the need for current public information required by
Rule 144(c)(1) (or Rule 144(i)(2), if applicable) or (ii) the date on which the
Holder shall have sold all of the Registrable Securities either pursuant to a
Registration Statement or Rule 144 (such earlier date, the “Registration Rights
Expiration Date”, and such period commencing on the date hereof and ending on
the Registration Rights Expiration Date, the “Registration Period”).

 

(b)               If the staff of the SEC (the “Staff”) or the SEC seeks to
characterize any offering pursuant to a Registration Statement filed pursuant to
this Agreement as constituting an offering of securities that does not permit
such Registration Statement to become effective and be used for resales by the
Holder on a delayed or continuous basis under Rule 415 at then-prevailing market
prices (and not fixed prices) (or as otherwise may be reasonably acceptable to
the Holder), or if after the filing of the Initial Registration Statement with
the SEC pursuant to this Section 2, the Company is otherwise required by the
Staff or the SEC to reduce the number of Registrable Securities included in such
Initial Registration Statement, then the Company shall reduce the number of
Registrable Securities to be included in such Initial Registration Statement
(with the prior consent, not to be unreasonably withheld, of the Holder as to
the specific Registrable Securities to be removed therefrom) until such time as
the Staff and the SEC shall so permit such Registration Statement to become
effective and be used as aforesaid. Notwithstanding anything in this Agreement
to the contrary, if after giving effect to the actions referred to in the
immediately preceding sentence, the Staff or the SEC does not permit such
Registration Statement to become effective and be used for resales by the Holder
on a delayed or continuous basis under Rule 415 at then-prevailing market prices
(and not fixed prices) (or as otherwise may be reasonably acceptable to the
Holder), the Company shall not request acceleration of the effective date of
such Registration Statement, the Company shall promptly (but in no event later
than 48 hours) request the withdrawal of such Registration Statement pursuant to
Rule 477 under the 1933 Act. In the event of any reduction in Registrable
Securities pursuant to this paragraph, the Company shall file additional
Registration Statements as permitted by the Staff or the SEC in accordance with
this Section 2 until such time as all Registrable Securities have been included
in Registration Statements that have been declared effective and the prospectus
contained therein is available for use by the Holder.

 

 

 

 

(c)                In addition, in the event that the Staff or the SEC requires
the Holder seeking to resell securities under a Registration Statement filed
pursuant to this Agreement to be specifically identified as an “underwriter” in
order to permit such Registration Statement to become effective, and the Holder
does not consent to being so named as an underwriter in such Registration
Statement, then, in each such case, the Company shall reduce the total number of
Registrable Securities to be registered on behalf of the Holder, until such time
as the Staff or the SEC does not require such identification or until the Holder
accepts such identification and the manner thereof. If notwithstanding any such
reduction, the Staff or the SEC still requires that the Holder be specifically
identified as an “underwriter” in order to permit such Registration Statement to
be declared effect, the Holder may, at its option, elect to have no Registrable
Securities of the Holder be included in such Registration Statement; provided,
that solely for purposes of Section 12 of the Note, such Registration Statement
shall be deemed to have been declared effective as of the date of such election
by the Holder.

 

(d)               If the filing, initial effectiveness or continued use of a
registration statement, including a shelf registration statement pursuant to
Rule 415 under the Securities Act, in respect of a registration pursuant to this
Section 2 at any time (i) would require the Company to make a public disclosure
of material non-public information, which disclosure in the good faith judgment
of the board of directors of the Company both (A) would not be required to be
made at such time but for the filing, effectiveness or continued use of such
registration statement and (B) would not be in the best interests of the Company
or would have a material adverse effect on the Company or its business or on the
Company’s ability to effect a material proposed acquisition, disposition,
financing, reorganization, recapitalization or similar transaction, or (ii) if
the Company reasonably believes that effecting such registration would
materially and adversely affect an offering of securities of the Company, the
preparation of which is then contemplated, then the Company may, upon giving
prompt written notice of such action to the Holder, delay the filing or initial
effectiveness of, or suspend use of, such registration statement; provided, that
the Company shall not be permitted to do so (A) more than two times during any
12 month period, (B) for a period exceeding 30 days on any one occasion or (C)
for a period exceeding 60 days in any 12 month period. In the event the Company
exercises its rights under the preceding sentence, the Holder agrees to suspend,
promptly upon its receipt of the notice referred to above, its use of any
prospectus relating to such registration in connection with any sale or offer to
sell Registrable Securities. The Company shall promptly notify the Holder of the
expiration of any period during which it exercised its rights under this Section
2 (d). The Company agrees that, in the event it exercises its rights under this
Section 2(d), it shall, within 30 days (or 60 days, as applicable) following the
Holder’s receipt of the notice of suspension, update the suspended registration
statement as may be necessary to permit the Holder to resume use thereof in
connection with the offer and sale of its Registrable Securities in accordance
with applicable law. For the avoidance of doubt, this Section 2(d) does not
modify or affect the Filing Deadline or any of the Company’s obligations under
Section 2(a).

 

 

 

 

Section 3.                Registration Procedures. If and whenever the Company
is required by the provisions of Section 2 to effect the registration of any
Registrable Securities under the 1933 Act, the Company will, as expeditiously as
possible:

 

(a)                subject to the timelines provided in this Agreement, prepare
and file the Registration Statement with the SEC, with respect to such
Registrable Securities and use its reasonable best efforts to cause such
Registration Statement to become and remain effective for the period of the
distribution contemplated thereby (determined as herein provided), respond as
promptly as commercially practicable to any comments received from the SEC with
respect to a Registration Statement or any amendment thereto and file any
pre-effective amendments with respect to a Registration Statement as promptly as
reasonable possible, and promptly provide to the Holder copies of all filings
and SEC letters of comment related to the Holder or the offering of the
Registrable Securities (provided that the Company shall excise any information
contained therein which would constitute material non-public information
regarding the Company or any subsidiary) and notify the Holder (by telecopier or
by e-mail addresses provided by the Holder) on or before the second Business Day
thereafter that the Company receives notice that (i) the SEC has no comments or
no further comments on the registration statement, and (ii) the registration
statement has been declared effective;

 

(b)               prepare and file with the SEC such amendments and supplements
to such Registration Statement and the prospectus used in connection therewith
as may be necessary to keep such Registration Statement effective and prepare
and file with the SEC such additional Registration Statements as may be required
hereunder and to keep each additional Registration Statement effective, in each
case, at all times during the Registration Period;

 

(c)                furnish to the Holder such number of copies of the
Registration Statement and the prospectus included therein (including each
preliminary prospectus) as the Holder reasonably may request in order to
facilitate the public sale or their disposition of the securities covered by
such Registration Statement or make them electronically available;

 

(d)               use its reasonable best efforts to register or qualify the
Registrable Securities covered by such Registration Statement at all times
during the Registration Period under the securities or “Blue Sky” laws of such
jurisdictions as the Holder shall request in writing, provided, however, that
the Company shall not for any such purpose be required to qualify to transact
business as a foreign corporation in any jurisdiction where it is not so
qualified or to consent to service of process in any such jurisdiction;

 

 

 

 

(e)                if applicable, list the Registrable Securities covered by
such Registration Statement with the principal market or exchange on which the
Common Stock is then listed;

 

(f)                promptly notify the Holder of the Company’s becoming aware
that a prospectus relating thereto is required to be delivered under the 1933
Act, of the happening of any event or passage of time of which the Company has
knowledge as a result of which the prospectus contained in such Registration
Statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances then
existing or the financial statements included therein ineligible for inclusion
or which becomes subject to a SEC, state or other governmental order suspending
the effectiveness of the Registration Statement covering any of the Registrable
Securities. The Holder hereby covenants that it will not sell any Registrable
Securities pursuant to such prospectus during the period commencing at the time
at which the Company gives the Holder notice of the suspension of the use of
such prospectus in accordance with this Section 3(f) and ending at the time the
Company gives the Holder notice that the Holder may thereafter effect sales
pursuant to the prospectus, or until the Company delivers to the Holder or files
with the SEC an amended or supplemented prospectus.

 

(g)               The Company shall cooperate with any broker-dealer through
which the Holder proposes to resell its Registrable Securities in effecting a
filing with the FINRA Corporate Financing Department pursuant to FINRA Rule
5110, as requested by any the Holder, and the Company shall pay the filing fee
required by such filing within two (2) Business Days of request therefor.

 

Section 4.                Provision of Documents. It shall be a condition
precedent to the obligations of the Company to complete the registration
pursuant to this Agreement with respect to the Registrable Securities of the
Holder that the Holder shall furnish to the Company such information regarding
itself, the Registrable Securities held by it and the intended method of
disposition of the Registrable Securities held by it, as shall be reasonably
required to effect and maintain the effectiveness of the registration of such
Registrable Securities and shall execute such documents in connection with such
registration as the Company may reasonably request.

 

Section 5.                Expenses. All expenses incurred by the Company in
complying with Section 2, including, without limitation, all registration and
filing fees, printing expenses (if required), fees and disbursements of counsel
and independent public accountants for the Company, fees and expenses (including
reasonable counsel fees) incurred in connection with complying with state
securities or “Blue Sky” laws, fees of the Financial Industry Regulatory
Authority, Inc. (“FINRA”) in connection with any filing with FINRA pursuant to
FINRA Rule 5110 that may be required to be made by any broker through which the
Holder intends to make sales of Registrable Securities, transfer taxes, and fees
of transfer agents and registrars, are called “Registration Expenses.” The
Company will pay all Registration Expenses in connection with any Registration
Statement described in Section 2.

 

 

 

 

Section 6.                Indemnification.

 

(a)                In the event any Registrable Securities are included in any
Registration Statement under this Agreement, to the fullest extent permitted by
law, the Company will, and hereby does, indemnify, hold harmless and defend the
Holder, each of its directors, officers, shareholders, members, partners,
employees, agents, advisors, representatives (and any other Persons with a
functionally equivalent role of a Person holding such titles notwithstanding the
lack of such title or any other title) and each Person, if any, who controls the
Holder within the meaning of Section 15 of the 1933 Act or Section 20 of the
Securities Exchange Act of 1934 Act, as amended (the “1934 Act”), and each of
the directors, officers, shareholders, members, partners, employees, agents,
advisors, representatives (and any other Persons with a functionally equivalent
role of a Person holding such titles notwithstanding the lack of such title or
any other title) of such controlling Persons (each, an “Holder Party” and
collectively, the “Holder Parties”), against any losses, obligations, claims,
damages, liabilities, contingencies, judgments, fines, penalties, charges, costs
(including, without limitation, court costs, reasonable attorneys’ fees, costs
of defense and investigation), amounts paid in settlement or expenses, joint or
several, (collectively, “Claims”) incurred in investigating, preparing or
defending any action, claim, lawsuit, inquiry, proceeding, investigation or
appeal taken from the foregoing by or before any court or governmental,
administrative or other regulatory agency, body or the SEC, whether pending or
threatened, whether or not an Holder Party is or may be a party thereto
(“Indemnified Damages”), to which any of them may become subject insofar as such
Claims (or actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of or are based upon: (i) any untrue statement or alleged
untrue statement of a material fact in a Registration Statement or any
post-effective amendment thereto or in any filing made in connection with the
qualification of the offering under the securities or other “Blue Sky” laws of
any jurisdiction in which Registrable Securities are offered (“Blue Sky
Filing”), or the omission or alleged omission to state a material fact required
to be stated therein or necessary to make the statements therein not misleading
or (ii) any untrue statement or alleged untrue statement of a material fact
contained in any prospectus (as amended or supplemented) or in any prospectus
supplement or the omission or alleged omission to state therein any material
fact necessary to make the statements made therein, in light of the
circumstances under which the statements therein were made, not misleading (the
matters in the foregoing clauses (i) and (ii) being, collectively,
“Violations”). Subject to Section 6(c), the Company shall reimburse the Holder
Parties, promptly as such expenses are incurred and are due and payable, for any
legal fees or other reasonable expenses incurred by them in connection with
investigating or defending any such Claim. Notwithstanding anything to the
contrary contained herein, the indemnification agreement contained in this
Section 6(a): (i) shall not apply to a Claim by an Holder Party arising out of
or based upon a Violation which occurs in reliance upon and in conformity with
information furnished in writing to the Company by the Holder Party for the
Holder Party expressly for use in connection with the preparation of such
Registration Statement, prospectus or prospectus supplement or any such
amendment thereof or supplement thereto; (ii) shall not be available to the
Holder to the extent such Claim is based on a failure of the Holder to deliver
or to cause to be delivered the prospectus (as amended or supplemented) made
available by the Company (to the extent applicable), including, without
limitation, a corrected prospectus, if such prospectus (as amended or
supplemented) or corrected prospectus was timely made available by the Company
pursuant to Section 3 and then only if, and to the extent that, following the
receipt of the corrected prospectus no grounds for such Claim would have
existed; and (iii) shall not apply to amounts paid in settlement of any Claim if
such settlement is effected without the prior written consent of the Company,
which consent shall not be unreasonably withheld or delayed. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of the Holder Party and shall survive the transfer of any of the
Registrable Securities by the Holder pursuant to Section 8(f).

 

 

 

 

(b)               In connection with any Registration Statement in which the
Holder is participating, the Holder agrees to severally and not jointly
indemnify, hold harmless and defend, to the same extent and in the same manner
as is set forth in Section 6(a), the Company, each of its directors, each of its
officers who signs the Registration Statement and each Person, if any, who
controls the Company within the meaning of the 1933 Act or the 1934 Act (each,
an “Company Party”), against any Claim or Indemnified Damages to which any of
them may become subject, under the 1933 Act, the 1934 Act or otherwise, insofar
as such Claim or Indemnified Damages arise out of or are based upon any
Violation, in each case, to the extent, and only to the extent, that such
Violation occurs in reliance upon and in conformity with written information
relating to the Holder furnished to the Company by the Holder expressly for use
in connection with such Registration Statement; and, subject to Section 6(c) and
the below provisos in this Section 6(b), the Holder will reimburse a Company
Party any legal or other expenses reasonably incurred by such Company Party in
connection with investigating or defending any such Claim; provided, however,
the indemnity agreement contained in this Section 6(b) and the agreement with
respect to contribution contained in Section 7 shall not apply to amounts paid
in settlement of any Claim if such settlement is effected without the prior
written consent of the Holder, which consent shall not be unreasonably withheld
or delayed, provided further that the Holder shall be liable under this Section
6(b) for only that amount of a Claim or Indemnified Damages as does not exceed
the net proceeds to the Holder as a result of the applicable sale of Registrable
Securities pursuant to such Registration Statement. Such indemnity shall remain
in full force and effect regardless of any investigation made by or on behalf of
such Company Party and shall survive the transfer of any of the Registrable
Securities by the Holder pursuant to Section 8(f).

 

(c)                Promptly after receipt by an Holder Party or Company Party
(as the case may be) under this Section 6 of notice of the commencement of any
action or proceeding (including, without limitation, any governmental action or
proceeding) involving a Claim, the Holder Party or Company Party (as the case
may be) shall, if a Claim in respect thereof is to be made against any
indemnifying party under this Section 6, deliver to the indemnifying party a
written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying party and the Holder Party or the Company Party (as the case may
be); provided, however, an Holder Party or Company Party (as the case may be)
shall have the right to retain its own counsel with the fees and expenses of
such counsel to be paid by the indemnifying party if: (i) the indemnifying party
has agreed in writing to pay such fees and expenses; (ii) the indemnifying party
shall have failed promptly to assume the defense of such Claim and to employ
counsel reasonably satisfactory to the Holder Party or Company Party (as the
case may be) in any such Claim; or (iii) the named parties to any such Claim
(including, without limitation, any impleaded parties) include both the Holder
Party or Company Party (as the case may be) and the indemnifying party, and the
Holder Party or such Company Party (as the case may be) shall have been advised
by counsel that a conflict of interest is likely to exist if the same counsel
were to represent the Holder Party or such Company Party and the indemnifying
party (in which case, if the Holder Party or such Company Party (as the case may
be) notifies the indemnifying party in writing that it elects to employ separate
counsel at the expense of the indemnifying party, then the indemnifying party
shall not have the right to assume the defense thereof on behalf of the
indemnified party and such counsel shall be at the expense of the indemnifying
party, provided further that in the case of clause (iii) above the indemnifying
party shall not be responsible for the reasonable fees and expenses of more than
one (1) separate legal counsel for all Holder Parties or Company Parties (as the
case may be). The Company Party or Holder Party (as the case may be) shall
reasonably cooperate with the indemnifying party in connection with any
negotiation or defense of any such action or Claim by the indemnifying party and
shall furnish to the indemnifying party all information reasonably available to
the Company Party or Holder Party (as the case may be) which relates to such
action or Claim. The indemnifying party shall keep the Company Party or Holder
Party (as the case may be) reasonably apprised at all times as to the status of
the defense or any settlement negotiations with respect thereto. No indemnifying
party shall be liable for any settlement of any action, claim or proceeding
effected without its prior written consent; provided, however, the indemnifying
party shall not unreasonably withhold, delay or condition its consent. No
indemnifying party shall, without the prior written consent of the Company Party
or Holder Party (as the case may be), consent to entry of any judgment or enter
into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Company Party or Holder Party (as the case may be) of a release from all
liability in respect to such Claim or litigation, and such settlement shall not
include any admission as to fault on the part of the Company Party. For the
avoidance of doubt, the immediately preceding sentence shall apply to Sections
6(a) and 6(b) hereof. Following indemnification as provided for hereunder, the
indemnifying party shall be subrogated to all rights of the Company Party or
Holder Party (as the case may be) with respect to all third parties, firms or
corporations relating to the matter for which indemnification has been made. The
failure to deliver written notice to the indemnifying party within a reasonable
time of the commencement of any such action shall not relieve such indemnifying
party of any liability to the Holder Party or Company Party (as the case may be)
under this Section 6, except to the extent that the indemnifying party is
materially and adversely prejudiced in its ability to defend such action.

 

 

 

 

(d)               No Person involved in the sale of Registrable Securities who
is guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the 1933 Act) in connection with such sale shall be entitled to
indemnification from any Person involved in such sale of Registrable Securities
who is not guilty of fraudulent misrepresentation.

 

(e)                The indemnification required by this Section 6 shall be made
by periodic payments of the amount thereof during the course of the
investigation or defense, as and when bills are received or Indemnified Damages
are incurred; provided that the Holder shall promptly reimburse the Company for
all such payments to the extent a court of competent jurisdiction determines
that any Holder Party was not entitled to such payments.

 

 

 

 

(f)                The indemnity and contribution agreements contained herein
shall be in addition to (i) any cause of action or similar right of the Company
Party or Holder Party against the indemnifying party or others, and (ii) any
liabilities the indemnifying party may be subject to pursuant to the law.

 

Section 7.                Contribution. To the extent any indemnification by an
indemnifying party is prohibited or limited by law, the indemnifying party
agrees to make the maximum contribution with respect to any amounts for which it
would otherwise be liable under Section 6 to the fullest extent permitted by
law; provided, however: (i) no contribution shall be made under circumstances
where the maker would not have been liable for indemnification under the fault
standards set forth in Section 6 of this Agreement, (ii) no Person involved in
the sale of Registrable Securities which Person is guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) in
connection with such sale shall be entitled to contribution from any Person
involved in such sale of Registrable Securities who was not guilty of fraudulent
misrepresentation; and (iii) contribution by any seller of Registrable
Securities shall be limited in amount to the amount of net proceeds received by
such seller from the applicable sale of such Registrable Securities pursuant to
such Registration Statement. Notwithstanding the provisions of this Section 7,
the Holder shall not be required to contribute, in the aggregate, any amount in
excess of the amount by which the net proceeds actually received by the Holder
from the applicable sale of the Registrable Securities subject to the Claim
exceeds the amount of any damages that the Holder has otherwise been required to
pay, or would otherwise be required to pay under Section 6(b), by reason of such
untrue or alleged untrue statement or omission or alleged omission.

 

Section 8.                Miscellaneous.

 

(a)                Remedies. In the event of a breach by the Company or by the
Holder of any of their respective obligations under this Agreement, the Holder
or the Company, as the case may be, in addition to being entitled to exercise
all rights granted by law and under this Agreement, including recovery of
damages, shall be entitled to specific performance of its rights under this
Agreement. Each of the Company and the Holder agrees that monetary damages would
not provide adequate compensation for any losses incurred by reason of a breach
by it of any of the provisions of this Agreement and hereby further agrees that,
in the event of any action for specific performance in respect of such breach,
it shall not assert or shall waive the defense that a remedy at law would be
adequate.

 

(b)               Compliance. The Holder covenants and agrees that it will
comply with the prospectus delivery requirements of the 1933 Act as applicable
to it or an exemption therefrom in connection with sales of Registrable
Securities pursuant to a Registration Statement.

 

(c)                Piggy-Back Registrations. If, at any time prior to the six
month anniversary of the date of the issuance of the Note, there is not an
effective Registration Statement covering all of the Registrable Securities and
the Company shall determine to prepare and file with the SEC a registration
statement relating to an offering for its own account or the account of others
under the 1933 Act of any of its equity securities, other than on Form S-4 or
Form S-8 (each as promulgated under the 1933 Act) or their then equivalents
relating to equity securities to be issued solely in connection with any
acquisition of any entity or business or equity securities issuable in
connection with the Company’s stock option or other employee benefit plans, then
the Company shall deliver to the Holder a written notice of such determination
and, if within fifteen days after the date of the delivery of such notice, the
Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities the Holder
requests to be registered; provided, however, that the Company shall not be
required to register any Registrable Securities pursuant to this Section 8(c)
that are the subject of a then effective Registration Statement.

 

 

 

 

(d)               Amendments and Waivers. No provision of this Agreement may be
(i) amended other than by a written instrument signed by both parties hereto or
(ii) waived other than in a written instrument signed by the party against whom
enforcement of such waiver is sought. Failure of any party to exercise any right
or remedy under this Agreement or otherwise, or delay by a party in exercising
such right or remedy, shall not operate as a waiver thereof.

 

(e)                Notices. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be delivered as
set forth in the Purchase Agreement.

 

(f)                Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties. The Company may not assign (except by merger) its rights or
obligations hereunder without the prior written consent of the Holder. The
Holder may assign its rights and obligations hereunder to a third party in
connection with the transfer of the Note or the Registrable Securities permitted
under the Purchase Agreement, if the Holder agrees in writing with such
transferee or assignee (as the case may be) to assign all or any portion of such
rights, and a copy of such agreement is furnished to the Company within a
reasonable time after such transfer or assignment (as the case may be) and the
Company is, within a reasonable time after such transfer or assignment (as the
case may be), furnished with written notice of (a) the name and address of such
transferee or assignee (as the case may be), and (b) the securities with respect
to which such registration rights are being transferred or assigned (as the case
may be). The term “Holder” in this Agreement shall also include all such
transferees and assignees.

 

(g)               Execution and Counterparts. This Agreement may be executed in
two or more counterparts, all of which when taken together shall be considered
one and the same agreement and shall become effective when counterparts have
been signed by each party and delivered to the other party, it being understood
that both parties need not sign the same counterpart. In the event that any
signature is delivered by facsimile transmission or by e-mail delivery of a
“.pdf” format data file, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile or “.pdf”
signature page were an original thereof.

 

(h)               Governing Law. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be determined
in accordance with the provisions of the Purchase Agreement.

 

 

 

 

(i)                 Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable best efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.

 

(j)                 Headings. The headings in this Agreement are for convenience
only, do not constitute a part of the Agreement and shall not be deemed to limit
or affect any of the provisions hereof.

 

(Signature Pages Follow)

 

 

 

 

IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement
as of the date first written above.

 

 

KINGOLD JEWELRY, INC.

 

      By:         Name:   Zhihong Jia     Title:  Chairman and CEO

 

IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement
as of the date first written above.

 

 

Fidelidade – Companhia de Seguros, S.A.

 

 

        By:       Name:       Title:           By:       Name:       Title: