exv4w12






Exhibit 4.12




CHINA LODGING GROUP, LIMITED




WARRANT FOR THE PURCHASE OF SHARES OF

COMMON STOCK OF CHINA LODGING GROUP, LIMITED



			
	 	 	 
	No.  2
	 	Warrant to Purchase

200,000 Shares







THIS SECURITY AND ALL SECURITIES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT REGISTRATION UNDER THE 1933 ACT UNLESS
EITHER (i)THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED IN CONNECTION
WITH SUCH DISPOSITION OR (ii) THE SALE OF SUCH SECURITIES IS MADE PURSUANT TO RULE 144
PROMULGATED UNDER THE 1933 ACT.



     FOR VALUE RECEIVED, CHINA LODGING GROUP, LIMITED, a company incorporated in the Cayman Islands
with limited liability (the “Company”), hereby certifies that Tongren Investment Holdings Limited,
its successor or permitted assigns (the “Holder”), is entitled, subject to the provisions of this
Warrant, to purchase from the Company, at the times specified herein, 200,000 fully paid and
non-assessable shares of ordinary shares of the Company, par value US$0.0001 per share (the “Common
Stock”), at a purchase price per share equal to the Exercise Price (as hereinafter defined). The
number of shares of Common Stock to be received upon the exercise of this Warrant and the price to
be paid for a share of Common Stock are subject to adjustment from time to time as hereinafter set
forth.



     1. Definitions. The following terms, as used herein, have the following meanings:



     “Board of Directors” means the board of directors of the Company.



     “Business Day” means any day except a Saturday, Sunday or other day on which commercial banks
in the City of New York are authorized by law to close.



     “Exercise Price” means US$1.54 per Warrant Share, as the same may be adjusted from time to
time as provided in this Warrant.



 









 





     “Expiration Time” means 5:00 p.m. New York City on February 10, 2010.



     “Person” means an individual, corporation, partnership, limited liability company,
association, trust or other entity or organization, including a government or political subdivision
or an agency or instrumentality thereof.



     “Warrant Shares” means the shares of Common Stock deliverable upon exercise of this Warrant,
as the same may be adjusted from time to time as provided in this Warrant.



     2. Exercise of Warrant.




     (a) The Holder is entitled to exercise this Warrant one time in whole on or before the
Expiration Time. To exercise this Warrant, the Holder shall deliver to the Company (i) an
executed Warrant Exercise Notice substantially in the form annexed to this Warrant and (ii)
this Warrant.




     (b) The Exercise Price may be paid either by wire transfer of immediately available
funds to an account designated by the Company or by certified or official bank check or bank
cashier’s check payable to the order of the Company. The Company shall pay any and all
documentary, stamp or similar issue or transfer taxes payable in respect of the issue or
delivery of the Warrant Shares; provided that the Company shall not be required to pay any
taxes that may be payable in respect of any transfer involved in the issuance and delivery
of the Warrant Shares in a name other than that of the Holder. Upon such payment, the Holder
shall be deemed to be the holder of record of the Warrant Shares subject to such exercise,
notwithstanding that the stock transfer books of the Company shall then be closed or that
certificates representing such Warrant Shares shall not then be actually delivered to the
Holder.




     (c) Upon surrender of this Warrant in conformity with the foregoing provisions, the
Company shall transfer to the Holder of this Warrant appropriate evidence of ownership of
the shares of Common Stock to which the Holder is entitled, registered or otherwise placed
in, or payable to the order of, the name or names of the Holder or its transferee pursuant
to paragraph 6 as may be directed in writing by the Holder, and shall deliver such evidence
of ownership to the Person or Persons entitled to receive the same, together with an amount
in cash in lieu of any fraction of a share as provided in paragraph 5 below.



     3. Restrictive Legend. Certificates representing shares of Common Stock issued pursuant to
this Warrant shall bear a legend substantially in the form of the legend set forth on the first
page of this Warrant to the extent that and for so long as such legend is required pursuant to
applicable securities laws.



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     4. Reservation of Shares. The Company hereby agrees that at all times there shall be reserved
for issuance and delivery upon exercise of this Warrant such number of its authorized but unissued
shares of Common Stock of the Company from time to time issuable upon exercise of this Warrant as
will be sufficient to permit the exercise in full of this Warrant. All such shares shall be duly
authorized and, when issued upon such exercise, shall be validly issued, fully paid and
non-assessable, free and clear of all liens, security interests, charges and other encumbrances or
restrictions on sale and free and clear of all preemptive rights, in each case except restrictions
on transfer contemplated by paragraph 3, to the extent created by the Holder.



     5. Fractional Shares. No fractional shares or scrip representing fractional shares shall be
issued upon the exercise of this Warrant, and in lieu of delivery of any such fractional share to
which the Holder may be entitled upon any exercise of this Warrant, the Company shall pay to the
Holder an amount in cash equal to such fraction multiplied by the current fair market value per
share as of the Business Day immediately preceding the date on which the Holder delivers the
Warrant Exercise Notice pursuant to paragraph 2(a), as determined in good faith by the Board of
Directors.



     6. Exchange, Transfer or Assignment of Warrant.




     (a) Each taker and holder of this Warrant, by taking or holding the same, consents and
agrees that the registered holder hereof may be treated by the Company and all other Persons
dealing with this Warrant as the absolute owner hereof for any purpose and as the Person
entitled to exercise the rights represented hereby.




     (b) Subject to this Warrant and compliance with applicable securities laws, the Holder
shall be entitled, with prior written consent of the Company, to assign and transfer this
Warrant, at any time only in whole, to any Person or Persons. Subject to the preceding
sentence, upon surrender of this Warrant to the Company, together with the attached Warrant
Assignment Form duly executed, the Company shall, as promptly as practicable and without
charge, execute and deliver a new Warrant in the name of the assignee or assignees named in
such Warrant Assignment Form and, if the Holder’s entire interest is not being assigned, in
the name of the Holder and this Warrant shall promptly be canceled.



     7. Restrictions on Transfer. The Holder, by acceptance hereof, agrees that, absent an
effective registration statement filed with the United States Securities and Exchange Commission
under the 1933 Act, covering the disposition or sale of this Warrant or the Warrant Shares issued
or issuable upon exercise hereof, as the case may be, and registration or qualification under
applicable state securities laws, such Holder will not sell, transfer, pledge, or hypothecate any
or all such Warrants or Warrant Shares, as the case may be, unless either (i) the Company has
received an opinion of counsel, in form and



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substance reasonably satisfactory to the Company, to the effect that such registration is not
required in connection with such disposition or (ii) the sale of such securities is made pursuant
to Rule 144 under the 1933 Act.




     8. Loss or Destruction of Warrant. Upon receipt by the Company of evidence satisfactory to it
(in the exercise of its reasonable discretion) of the loss, theft, destruction or mutilation of
this Warrant, and (in the case of loss, theft or destruction) of reasonably satisfactory
indemnification, and upon surrender and cancellation of this Warrant, if mutilated, the Company
shall execute and deliver a new Warrant of like tenor and date.



     9. Anti-dilution Provisions.




     (a) Common Stock Dividends, Subdivisions or Combinations. If the Company shall at any
time after the date hereof (A) declare and pay a dividend or make a distribution on Common
Stock payable in Common Stock, (B) subdivide or split the outstanding shares of Common Stock
into a greater number of shares or (C) combine or reclassify the outstanding shares of
Common Stock into a smaller number of shares, then in each such case:




     (i) the number of Warrant Shares issuable upon exercise of this Warrant
thereafter shall be proportionately adjusted so that the exercise of this
Warrant after such event shall entitle the Holder to receive the aggregate
number of shares of Common Stock that such Holder would have been entitled to
receive had such Holder exercised this Warrant immediately prior to such event;
and




     (ii) the Exercise Price thereafter shall be adjusted to equal the product
of the Exercise Price in effect immediately prior to such event multiplied by a
fraction (A) the numerator of which shall be the number of Warrant Shares
issuable upon the exercise of this Warrant immediately prior to such event and
(B) the denominator of which shall be the number of Warrant Shares issuable upon
the exercise of this Warrant immediately following such event.



     Any adjustment made pursuant to this paragraph 9(a) shall become effective immediately after
the applicable record date in the case of a dividend or distribution and immediately after the
applicable effective date in the case of a subdivision, split, combination or reclassification.




     (b) Certain Distributions. If the Company shall fix a record date for the making of a
distribution to holders of Common Stock of shares of securities, evidences of indebtedness,
assets, cash, rights or warrants



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(other than dividends of shares of Common Stock for which an adjustment is made
pursuant to paragraph 9(a)), then in each such case:





     (i) the Exercise Price thereafter shall be adjusted to equal the product of
the Exercise Price in effect immediately prior to the record date multiplied by
a fraction (A) the numerator of which shall be the current fair market value per
share as of such record date, as determined in good faith by the Board of
Directors, less the amount of cash and/or the portion of the fair market value
of the securities, evidences of indebtedness, assets, rights or warrants to be
so distributed with respect to one share of Common Stock and (B) the denominator
of which shall be such current fair market value per share; and.




     (ii) the number of Warrant Shares issuable upon exercise of this Warrant
thereafter shall be adjusted to equal the product of the number of Warrant
Shares issuable upon exercise of this Warrant immediately prior to such record
date multiplied by a fraction (A) the numerator of which shall be the Exercise
Price in effect immediately prior to such record date and (B) the denominator of
which shall be the Exercise Price in effect immediately following such record
date.



     Any adjustment made pursuant to this paragraph 9(b) shall become effective immediately after
the applicable record date. In the event that such distribution is not so made, the Exercise Price
and the number of Warrant Shares issuable upon exercise of this Warrant shall again be adjusted to
be the Exercise Price and the number of Warrant Shares issuable upon exercise of the Warrant that
would be in effect if such record date had not been so fixed.




     (c) Consolidation, Merger or Sale of Assets. In the event of any consolidation of the
Company with, or merger of the Company into, any other Person, any merger of another Person
into the Company (other than a merger which does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of Common Stock) or any sale or
transfer of all or substantially all of the assets of the Company to the Person formed by
such consolidation or resulting from such merger or to the Person that acquires such assets
pursuant to any such sale or transfer of all or substantially all of the assets of the
Company, as the case may be, the Holder shall have the right thereafter to exercise this
Warrant for the kind and amount of securities, cash and/or other property receivable upon
such consolidation, merger, sale or transfer by a holder of the number of shares of Common
Stock for which this Warrant may have been exercised immediately prior to such
consolidation, merger, sale or transfer. In determining the kind and amount of securities,
cash and/or other property receivable upon such consolidation, merger, sale or transfer, if
the holders of Common Stock have the right to elect as to the consideration to be



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received upon the consummation of such consolidation, merger, sale or transfer, then
the consideration that the Holder shall be entitled to receive upon exercise shall be deemed
to be the kind and amount of consideration received by the majority of all holders of Common
Stock that affirmatively make an election (or of all such holders if none make an election).
Adjustments for events subsequent to the effective date of such a consolidation, merger,
sale or transfer of assets shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Warrant. In any such event, effective provisions shall be
made in the certificate or articles of incorporation of the resulting or surviving
corporation, in any contract of sale, merger, conveyance, lease, transfer or otherwise so
that the provisions set forth herein for the protection of the rights of the Holder shall
thereafter continue to be applicable; and any such resulting or surviving corporation shall
expressly assume the obligation to deliver, upon exercise, such shares of stock, other
securities, cash and property.




     (d) Certain Determinations. For purposes of any computation of any adjustment required
under this paragraph 9:




     (i) adjustments shall be made successively whenever any event giving rise
to such an adjustment shall occur;




     (ii) if any portion of any consideration to be received by the Company in a
transaction giving rise to such an adjustment shall be in a form other than
cash, the fair market value of such non-cash consideration shall be utilized in
such computation. Such fair market value shall be determined in good faith by
the Board of Directors; provided that if the Holder shall object to any such
determination, the Board of Directors shall retain an independent appraiser
reasonably satisfactory to the Holder to determine such fair market value. The
expense of such independent appraiser shall be shared equally by the Company and
the Holder. The Holder shall be notified promptly of any consideration other
than cash to be received by the Company and furnished with a description of the
consideration and the fair market value thereof, as determined in accordance
with the foregoing provisions;




     (iii) such calculations shall be made to the nearest one-tenth of a cent or
to the nearest hundredth of a share, as the case may be; and




     (iv) no adjustment in the Exercise Price or the number of Warrant Shares
issuable upon exercise of the Warrant, as the case may be, shall be required if
the amount of such adjustment would be less than one-tenth of a cent or
hundredth of a share, as the case may be.



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     (e) Certificates as to Adjustments. Upon the occurrence of each adjustment to the
Exercise Price and/or the number of Warrant Shares issuable upon exercise of this Warrant,
the Company shall promptly compute such adjustment in accordance with the terms hereof and
furnish to the Holder a certificate setting forth such adjustment and showing in reasonable
detail the facts upon which such adjustment is based.




     (f) Notices. In the event that the Company shall propose at any time to effect any of
the events described in paragraphs (a) through (c) above that would result in an
adjustment to the Exercise Price, the number of Warrant Shares issuable upon exercise of
this Warrant or a change in the type of securities or property to be delivered upon exercise
of this Warrant, the Company shall send notice to the Holder in the manner set forth in
paragraph 10. In the case of a dividend or other distribution, such notice shall be sent
at least 5 days prior to the applicable record date and shall specify such record date and
the date on which such dividend or other distribution is to be made. In any other case,
such notice shall be sent at least 5 days prior to the effective date of any such event and
shall specify such effective date. In all cases, such notice shall specify such event in
reasonable detail, including the effect on the Exercise Price and the number, kind or class
of securities or other property issuable upon exercise of this Warrant.



     10. Services Provided by Tongren Investment Holdings Limited. In consideration for the
warrant issued hereunder, Tongren Investment Holdings Limited agrees to provide the Company with an
annual hotel marketing research report relating to the Hangzhou area for six (6) years from 2010 to
2015 (inclusive). The report shall be researched-based and include RevPAR and occupancy for hotels
by segments of budget, economy, mid-scale without food and beverage and 4-5 star hotels. Such
annual report, in form and substance reasonably satisfactory to the Company, shall be delivered to
the Company prior to May 31 of each of such six (6) years. In avoidance of any doubt, the services
provided hereby are solely out of China and to and for the benefit of the Company.



     11. Notices. Any notice, demand or delivery authorized by this Warrant shall be in writing
and shall be given to the Holder or the Company, as the case may be, at its address (or facsimile
number) set forth below, or such other address (or facsimile number) as shall have been furnished
to the party giving or making such notice, demand or delivery:



     If to the Company:



China Lodging Group, Limited

5th Floor, Block 57, No. 461 Hongcao Road, Xuhui District

Shanghai 200233, China

Facsimile: 86-21-6485-6019

Attention: Min (Jenny) Zhang






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     with a copy to:


Davis Polk & Wardwell LLP

26/F, Twin Towers (West)

B12 Jian Guo Men Wai Avenue, Chaoyang District

Beijing 100022, China

Facsimile: 86-10-8567-5123

Attention: Howard Zhang




     If to the Holder:


Tongren Investment Holdings Limited

6 Huntang Bridge, Stadium Road

Hangzhou, China

Facsimile: 86-571-2899-3322

Attention: Chen Xiangdong




     Each such notice, demand or delivery shall be deemed received on the date of receipt by the
recipient thereof if received prior to 5:00 p.m. in the place of receipt and such day is a Business
Day. Otherwise, any such notice, demand or delivery shall be deemed not to have been received
until the next succeeding Business Day.



     12. Rights of the Holder. Prior to any exercise of this Warrant, the Holder shall not, by
virtue hereof, be entitled to any rights of a shareholder of the Company, including, without
limitation, the right to vote, to receive dividends or other distributions, to exercise any
preemptive right or to receive any notice of meetings of shareholders or any notice of any
proceedings of the Company except as may be specifically provided for herein.



     13. Liability for breach. If the holder fails to provide the Company with the annual report
on time, the holder shall pay the Company 3000 dollars as liquidated damages.



     14. GOVERNING LAW. THIS WARRANT AND ALL RIGHTS ARISING HEREUNDER SHALL BE CONSTRUED AND
DETERMINED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, AND THE PERFORMANCE
THEREOF SHALL BE GOVERNED AND ENFORCED IN ACCORDANCE WITH SUCH LAWS.



     15. Amendments; Waivers. Any provision of this Warrant may be amended or waived if, and only
if, such amendment or waiver is in writing and signed, in the case of an amendment, by the Holder
and the Company, or in the case of a waiver, by the party against whom the waiver is to be
effective. No failure or delay by either party in exercising any right, power or privilege



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hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.




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     IN WITNESS WHEREOF, the Company has duly caused this Warrant to be signed by its duly
authorized officer and to be dated as of January 15, 2010.



	 	 	 	 	 
	 	CHINA LODGING GROUP, LIMITED

 	 
	 	By:  	/s/  Tuo (Matthew) Zhang
 	 
	 	 	Name:  	Tuo (Matthew) Zhang 	 
	 	 	Title:  	Chief Executive Officer 	 
	 



Acknowledged and Agreed:




	 	 	 	 	 
	Tongren Investment Holdings Limited

 	 	 
	By:  	/s/ Chen Xiangdong
 	 	 
	 	Name:  	Chen Xiangdong 	 	 
	 	For and on behalf of Tongren

Investment Holdings Limited 	 	 
	 
















 





WARRANT EXERCISE NOTICE




(To be delivered prior to exercise of the Warrant

by execution of the Warrant Exercise Subscription Form)



To: China Lodging Group, Limited




     The undersigned hereby notifies you of its intention to exercise the Warrant to purchase
shares of Common Stock, par value US$0.0001 per share, of China Lodging Group, Limited. The
undersigned intends to exercise the Warrant to purchase 200,000 shares (the “Warrant Shares”) at
US$1.54 per Share (the Exercise Price currently in effect pursuant to the Warrant). As indicated
below, the undersigned intends to pay the aggregate Exercise Price for the Warrant Shares in by
wire transfer of immediately available funds or by certified or official bank or bank cashier’s
check.



Date:                     




	 	 	 	 	 
	 	
 	 
	 	(Signature of Owner) 	 
	 
	 
	 	(Street Address)
	 
	 
	 
	 	
(City)                    (State)                     (Zip Code) 	 
	 



	 	 	 	 	 
	Payment:

	 	o
	 	US$                     wire transfer of immediately available funds
	 
	 	 	 	 
	 

	 	o
	 	US$                     certified or official bank or bank cashier’s
check











 









 








WARRANT EXERCISE SUBSCRIPTION FORM




(To be executed only upon exercise of the Warrant

after deliver of Warrant Exercise Notice)


To: China Lodging Group, Limited




     The undersigned irrevocably exercises the Warrant for the purchase of 200,000 shares (the
“Warrant Shares”) of Common Stock, par value US$0.0001 per share, of China Lodging Group, Limited
(the “Company”) at US$1.54 per Share (the Exercise Price currently in effect pursuant to the
Warrant) and herewith makes payment of US$                     (such payment being made as specified in the
undersigned’s previously-delivered Warrant Exercise Notice), all on the terms and conditions
specified in the within Warrant, surrenders this Warrant and all right, title and interest therein
to the Company and directs that the Warrant Shares deliverable upon the exercise of this Warrant be
registered or placed in the name and at the address specified below and delivered thereto.


Date:                     




	 	 	 	 	 
	 	
 	 
	 	(Signature of Owner) 	 
	 
	 
	 	(Street Address)
	 
	 
	 
	 	
(City)                    (State)                     (Zip Code) 	 
	 







 









 







Securities and/or check to be issued to:



 




Please insert social security or identifying number:


 





Name:



 




Street Address:



 




City, State and Zip Code:


 





Any unexercised portion of the Warrant evidenced by the within Warrant to be issued to:



Please insert social security or identifying number:


 





Name:


 





Street Address:


 





City, State and Zip Code:



 










 









 








WARRANT ASSIGNMENT FORM




Dated                     , _____






	 	 	 
	FOR VALUE RECEIVED, _____________________ hereby sells, assigns and transfers unto
	  
	 
	 	 (please type or print in block letters)	 
	(the “Assignee”), 
	 	 






 



(insert address)



its right to purchase up to shares of Common Stock represented by this Warrant and does hereby
irrevocably constitute and appoint                                          Attorney, to transfer the same on the
books of the Company, with full power of substitution in the premises.



Signature: