Document:

Exhibit 10.12

 

[English Translation]

 

Shareholders’ Voting Rights Agreement

 

This Shareholders’ Voting Rights Agreement (“Agreement”) is entered into by and among the following parties on November 1, 2017:

 

1.                                               Zhang Xi

 

ID Number:

 

2.                                               Shanghai Xi Zhi Enterprise Management Co., Ltd. (together with Zhang Xi, the “Shareholders”)

 

Registered Address:

 

Legal Representative: Zhang Xi

 

3.                                               Shanghai Jing Xue Rui Information and Technology Co., Ltd. (“WFOE”)

 

Registered Address:

 

Legal Representative: Meng Xiaoqiang

 

4.                                               Shanghai Rui Si Technology Information Consulting Co., Ltd. (“Company”)

 

Registered Address:

 

Legal Representative: Shi Wei

 

(In this Agreement, each a “Party”, collectively the “Parties”.)

 

WHEREAS:

 

1.                                               The Shareholders are the shareholders currently on record of the Company, aggregately holding 100% of the equity interests in the Company. Upon the execution date of this Agreement, their contributions to the registered capital of the Company and proportions of shareholding are set out in Schedule 1 to this Agreement.

 

2.                                               The Shareholders executed an equity pledge agreement regarding the aforesaid equity interests with the WFOE on the same date of this Agreement.

 

 

3.                                               The Shareholders intend to entrust the WFOE or the individual designated by the WFOE to exercise all their shareholders’ voting rights in the Company (including the shareholders’ voting rights resulting from any form of capital increase during the term of this Agreement), and the WFOE or its designated individual intends to accept such entrustment.

 

THEREFORE, upon friendly discussions, the Parties agree as follows:

 

1.                                               Voting Rights Entrustment

 

1.1                                        The Shareholders each hereby irrevocably authorize, in respect of all their equity interests in the Company, the WFOE or the person then designated by the WFOE (“Proxy”) to exercise on their behalf and at the Proxy’s own discretion the following rights they are respectively entitled to as shareholders of the Company and in accordance with the then effective articles of association of the Company (“Proxy Rights”), and undertake to immediately and respectively execute a power of attorney in the form and substance of Schedule 2 to this Agreement immediately after the WFOE’s designation of other person other than the WFOE as the Proxy:

 

1.1.1                              as the proxy of each Shareholder, proposing to convene and attending the shareholders’ meetings in accordance with the articles of association of the Company;

 

1.1.2                              on behalf of each Shareholder, exercising voting rights on all issues required to be discussed and resolved by the shareholders’ meeting, including without limitation the appointment and election of the Company’s directors and other senior management who shall be appointed and removed by the shareholders, and the sale or transfer of all or part of the Shareholder’s equity interests in the Company;

 

1.1.3                              as the proxy of each Shareholder and on behalf of such Shareholder, executing any document (including any necessary documents to be executed by and among relevant parties for transfer in accordance with the Exclusive Purchase Right Agreement and Equity Pledge Agreement (including any amendment, supplement or restatement thereto from time to time) or disposal of equity interests in other manner ) that the Shareholder is entitled to execute as a shareholder, and handling any required governmental approval, registration, filing and other procedures;

 

1.1.4                              other shareholders’ voting rights under the articles of association of the Company (including any other shareholders’ voting rights stipulated after an amendment to such articles of association);

 

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1.1.5                              other shareholders’ voting rights entitled to the Shareholders under the laws and regulations of the People’s Republic of China (including the contents thereof as modified, amended, supplemented or reenacted, effective before or after the date of this Agreement).

 

The Proxy has the right to sub-entrust and is entitled to sub-entrust other individual or entity regarding the handling of the aforesaid issues without prior notice to or prior consent of the relevant Shareholder. When and only when the WFOE issues a written notice to each Shareholder to replace the Proxy, each Shareholder shall immediately appoint the other Proxy then appointed by the WFOE to exercise the aforesaid Proxy Rights, and the new entrustment, once made, will replace the original entrustment , and the Shareholders shall respectively execute a power of attorney in the form and substance attached to this Agreement as Schedule 2 to the Proxy newly appointed by the WFOE; other than the aforesaid, each Shareholder shall not revoke the entrustment and authorization granted to the Proxy.

 

1.2                                        The WFOE will cause the Proxy to carefully and diligently perform the entrusted duties within the scope of authorization under this Agreement in accordance with relevant laws; all the documents executed by the Proxy on the aforesaid issues shall be deemed as executed by each Shareholder each themselves; each Shareholder acknowledges and assumes corresponding liabilities for, any legal consequences arising out of the exercise of the aforesaid Proxy Rights by the Proxy.

 

1.3                                        Each Shareholder hereby acknowledges that the Proxy is not required to seek the opinions of each Shareholder when exercising the aforesaid Proxy Rights, provided that the Proxy shall timely inform each Shareholder after each resolution or proposal of convening an extraodinary shareholders’ meeting is made. The Proxy shall provide the relevant minutes of the meetings and resolutions to the Shareholders after such shareholders’ meetings or the adoption of such resolutions.

 

1.4                                        Each Shareholder hereby undertake that after the execution of this Agreement, they will authorize the Proxy to exercise all shareholders’ rights entitled to them, regardless of any change in their proportions of shareholding in the Company, and they shall not exercise the Proxy Rights on their own without prior written consent of the WFOE.

 

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2.                                               Right to Information

 

2.1                                        For the purpose of exercising the Proxy Rights under this Agreement, the Proxy is entitled to be informed of the operation, business, customers, finance, employees and other relevant information of the Company and to access relevant materials of the Company; the Company shall, and the Shareholders shall cause the Company to, provide full cooperation with respect to such right.

 

3.                                               Exercise of the Proxy Rights

 

3.1                                        Each Shareholder shall provide full assistance in respect of the exerciseof the Proxy Rights by the Proxy, including, when necessary (for example, in order to meet the requirements of submission documents needed for approval of, registration and filing with governmental authorities), timely executing the resolutions of the shareholders’ meeting adopted by the Proxy or other relevant legal documents.

 

3.2                                        If at any time during the term of this Agreement, the grant or exercise of the Proxy Rights under this Agreement cannot be realized for any reason (other than a breach of contract by the Shareholders or the Company), the Parties shall immediately seek an alternative scheme most similar to the provisions which cannot be realized and shall execute a supplementary agreement when necessary to amend or modify the terms of this Agreement so that the purpose of this Agreement can continue to be fulfilled.

 

3.3                                        If at any time during the term of this Agreement, the Shareholders sell or transfer all or part of their equity interests to any third party with consent of the WFOE, the Shareholders shall ensure the aforesaid third party will execute, before the closing of such equity transfer, an agreement in the form and substance basically the same with those of this Agreement, unless the WFOE waives such requirement through prior written consent.

 

4.                                               Exemption of Liability and Compensation

 

4.1                                        The Parties acknowledge that under no circumstances shall the WFOE be required to assume any liability or make any economic compensation or compensation in other aspects to the other Parties or to any third party in respect of the exercise of the Proxy Rights under this Agreement by the WFOE’s designated Proxy.

 

4.2                                        The Shareholders and the Company agree to indemnify the WFOE against all actual or potential losses arising from the designated Proxy’s exercise of the Proxy Rights and prevent the WFOE from any damages, including without limitation any losses incurred by litigations, recovery, arbitrations or claims for compensation initiated by any third party against the WFOE, or administration investigations or penalties of governmental authorities, except for those losses resulting from the Proxy’s willful conduct or gross negligence.

 

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5.                                               Representations and Warranties

 

5.1                                        The Shareholders hereby represent and warrant that:

 

5.1.1                              They are natural persons with full civil capacity; they have full and independent legal status and legal capacity, and have been duly authorized to execute, deliver and perform this Agreement, and may sue or be sued as an independent party.

 

5.1.2                              They have full power and authority to execute and deliver this Agreement and all other documents to be executed by them in connection with the transactions contemplated in this Agreement as well as full power and authority to consummate the transactions contemplated in this Agreement. This Agreement is lawfully and duly executed and delivered by them. This Agreement constitutes lawful and binding obligations enforceable against them in accordance with the terms of this Agreement.

 

5.1.3                              They are lawful shareholders on record of the Company as of the date of this Agreement; other than the rights created under this Agreement, the Equity Pledge Agreement (including any amendment, supplement or restatement thereto from time to time) and the Exclusive Purchase Right Agreement (including any amendment, supplement or restatement thereto from time to time) executed by and among the Shareholders, the Company and the WFOE, the Proxy Rights are free from any third party rights. In accordance with this Agreement, the Proxy may fully and sufficiently exercise the Proxy Rights under the then effective articles of association of the Company.

 

5.1.4                              The execution and performance of this Agreement by them do not violate or conflict with any law applicable to them in effect, any agreement to which they are a party or by which their assets are bound, any court judgment, any arbitral award, or any decision of any administrative authority.

 

5.2                                        The WFOE and the Company hereby respectively represent and warrant that:

 

5.2.1                              Each of them is a limited liability company duly registered and lawfully existing under the laws of its place of registration with independent legal personality; it has full and independent legal status and legal capacity to execute, deliver and perform this Agreement, and has been duly authorized to execute, deliver and perform this Agreement, and may sue or be sued as an independent party.

 

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5.2.2                              Each of them has full internal corporate power and authority to execute and deliver this Agreement and all other documents to be executed by it in connection with the transactions contemplated in this Agreement as well as full power and authority to consummate the transactions contemplated in this Agreement. This Agreement is lawfully and duly executed and delivered by it. The execution and performance of this Agreement by it do not violate or conflict with any law applicable to it in effect, any agreement to which it is a party or by which its assets are bound, any court judgment, any arbitral award, or any decision of any administrative authority. This Agreement constitutes lawful and binding obligations enforceable against it in accordance with the terms of this Agreement.

 

5.2.3                              Each of them warrants that the Proxy will fully and timely complies with and performs the provisions in respect of the Proxy under this Agreement, as if the Proxy were a party to this Agreement.

 

5.3                                        The Company further represents and warrants that:

 

5.3.1                              The Shareholders are lawful shareholders on record of the Company as of the date of this Agreement; other than the rights created under this Agreement, the Equity Pledge Agreement (including any amendment, supplement or restatement thereto from time to time) and the Exclusive Purchase Right Agreement (including any amendment, supplement or restatement thereto from time to time) executed by and among the Shareholders, the Company and the WFOE, the Proxy Rights are free from any third party rights. In accordance with this Agreement, the Proxy may fully and sufficiently exercise the Proxy Rights under the then effective articles of association of the Company.

 

6.                                               Term of Agreement

 

6.1                                        This Agreement shall be formed and become effective after being executed/sealed by the Parties or their authorized representatives; unless terminated in advance by written agreement of the Parties, or terminated in advance in accordance with Section 9.1 of this Agreement, this Agreement shall remain effective.

 

6.2                                        If either of the Shareholders transfers, with prior consent of the WFOE, all his/her/its equity interests in the Company, such Shareholder shall cease to be a party to this Agreement, provided that the obligations and undertakings of the other Parties under this Agreement shall not be adversely affected thereby, and each Shareholder permitted to transfer his/her/its equity interests shall cause and warrant that his/her/its transferee will continue to perform the obligations of such Shareholder under this Agreement.

 

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7.                                               Notice

 

7.1                                        Any notice, request, demand and other correspondences required by or made pursuant to this Agreement shall be made in writing and delivered to the relevant Parties.

 

7.2                                        Notices under this Agreement shall be delivered in person, by facsimile or by registered post to the following addresses unless changed by written notifications. The delivery date of the notice shall be the receiving date on the receipt if delivered by registered post, or the date of delivering to the recipient if delivered in person or by facsimile. If delivered by facsimile, the original notice should be immediately sent to the following addresses in person or by registered post after such delivery.

 

The WFOE: Shanghai Jing Xue Rui Information and Technology Co., Ltd.

Registered Address:

Tel:

Recipient: Zhang Xi

 

The Company and the Shareholders

Domicile:

Tel:

Recipient: Zhang Xi

 

8.                                               Confidentiality Obligations

 

8.1                                        During the term of this Agreement and after the termination of this Agreement, the Parties shall maintain the business secrets, exclusive information, customer information and all other information with confidential nature regarding other Parties obtained during the entry into and performance of this Agreement (“Confidential Information”) in strict confidence. Except where prior written consent has been obtained from the Party disclosing the Confidential Information or where disclosure to a third party is mandated by relevant laws and regulations or by the requirements of the listing place of a Party’s affiliate, or where the disclosure is made during the proceedings of any suit, arbitration or other legal proceedings or made, in relation to the aforesaid legal proceedings, to the courts, arbitration institutions, or relevant implementation or regulatory authorities of the legal proceedings, the Party receiving the Confidential Information shall not disclose any Confidential Information to any other third party; the Party receiving the Confidential Information shall not directly or indirectly use any Confidential Information other than for the purpose of performing this Agreement.

 

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8.2                                        The following information shall not constitute Confidential Information:

 

8.2.1                              any information that has already been previously obtained by the receiving Party in a lawful manner as proved by written records;

 

8.2.2                              any information that enters the public domain not due to the fault of the receiving Party; or

 

8.2.3                              any information lawfully acquired by the receiving Party from other sources after the receipt of relevant information.

 

8.3                                        A receiving Party may disclose the Confidential Information to its or its related parties’ relevant employees, agents, lenders or potential lenders (including the agents or trustees of the lenders), financing arrangers or potential financing arrangers or their appointed professionals, provided that such receiving Party shall ensure that the aforesaid persons comply with relevant terms and conditions of this Agreement or (as for any lenders (including the agents or trustees of the lenders) or the financing arrangers) relevant terms and conditions of the separately executed confidentiality agreements, and the receiving Party shall assume any liability arising out of the breach by the aforesaid persons of such relevant terms and conditions.

 

8.4                                        Notwithstanding any other provisions of this Agreement, the validity of this section shall not be affected by any termination of this Agreement.

 

9.                                               Liability for Default

 

9.1                                        The Parties agree and acknowledge that if any Party (“Defaulting Party”) materially breaches any provision of this Agreement, or materially fails to perform or delays in performing any obligation under this Agreement, it shall constitute a default under this Agreement (“Default”) and each of the non-defaulting Parties (“Non-defaulting Parties”) shall be entitled to request the Defaulting Party to cure such Default or take remedies within a reasonable time period. If the Defaulting Party fails to cure such Default or take remedies within such reasonable time period or within ten (10) days after the other Party notifies the Defaulting Party in writing and requests it to cure such Default, then:

 

9.1.1                              If any Shareholder or the Company is the Defaulting Party, the WFOE shall be entitled to terminate this Agreement and request the Defaulting Party to indemnify it for damages, or to request the Defaulting Party to continue to perform its obligations under this Agreement and to request the Defaulting Party to indemnify it for all the damages;

 

9.1.2                              If the WFOE is the Defaulting Party, the Non-defaulting Parties shall be entitled to request the WFOE to indemnify it for damages, provided that unless otherwise stipulated by laws or this Agreement or agreed by the Parties, the Non-defaulting Parties shall not be entitled to terminate or cancel this Agreement under any circumstances.

 

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9.2                                        Notwithstanding any other provisions of this Agreement, the validity of this section shall not be affected by the suspension or termination of this Agreement.

 

10.                                        Miscellaneous

 

10.1                                 This Agreement is made in Chinese in four (4) originals. Each Party to this Agreement shall hold one (1) copy and other copies are used for relevant procedures. All originals shall have equal legal effect.

 

10.2                                 The entry into, effectiveness, performance, amendment, interpretation and termination of this Agreement shall be governed by the laws of the People’s Republic of China.

 

10.3                                 Any dispute arising out of and in connection with this Agreement shall be settled by the Parties through consultations and shall, in the absence of an agreement being reached by the Parties within thirty (30) days from its occurrence, be submitted by any Party to China International Economic and Trade Arbitration Commission (“CIETAC”) for arbitration in accordance with the then effective arbitration rules of CIETAC. The place of arbitration shall be Beijing and the language for arbitration shall be Chinese. The arbitration award shall be final and binding on the Parties to this Agreement.

 

10.4                                 No rights, power or remedies granted to each Party by any provision of this Agreement shall preclude any other rights, power or remedies enjoyed by such Party in accordance with the laws or any other provisions under this Agreement and no exercise by a Party of any of its rights, powers and remedies shall preclude its exercise of its other rights, power and remedies.

 

10.5                                 No failure or delay by a Party in exercising any rights, power or remedies pursuant to this Agreement or any laws (“Such Rights”) shall result in a waiver of Such Rights; and no single or partial waiver of Such Rights shall preclude such Party from exercising Such Rights in any other manner or from exercising other Such Rights.

 

10.6                                 All the schedules listed in this Agreement constitute an integral part of this Agreement and have equal legal effect as the body text of this Agreement.

 

10.7                                 The section headings in this Agreement are for convenience of reference only and shall in no event be used in or affect the interpretation of the provisions of this Agreement.

 

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10.8                                 Each provision contained in this Agreement shall be severable and independent from any other provisions of this Agreement, and if at any time any one or more provisions of this Agreement become invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this Agreement shall not be affected thereby.

 

10.9                                 Any amendments or supplements to this Agreement shall be made in writing, and shall take effect only if duly executed by the Parties to this Agreement. Notwithstanding as otherwise agreed in this Agreement, without prior written consent of the WFOE, any Shareholder shall not revoke its entrustment of the Proxy Rights under this Agreement and any Shareholder and the Company shall not terminate this Agreement. Notwithstanding the aforesaid, the WFOE can at any time terminate this Agreement by sending a written notice to the Shareholders and the Company thirty (30) days in advance.

 

10.10                          Without prior written consent of the WFOE, other Parties shall not transfer any of their rights and/or obligations under this Agreement to any third party. The Shareholders and the Company hereby agree that the WFOE is entitled to transfer any of its rights and/or obligations under this Agreement to any third party without prior notice to or consent of relevant Shareholders or the Company.

 

10.11                          This Agreement shall be binding upon the lawful successors of the Parties.

 

[Intentionally left blank below]

 

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IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized representatives of the Parties as of the date first above written.

 

 

	
WFOE: Shanghai Jing Xue Rui Information and   Technology Co., Ltd. (seal)
    
	
 
    	
 
    
	
 
    	
 
    
	
Signature:
    	
/s/ Meng Xiaoqiang
    	
 
    
	
 
    	
 
    	
 
    
	
Name: Meng   Xiaoqiang
    	
 
    
	
 
    	
 
    
	
Position: Legal Representative
    	
 
    

 

Signature Page to Shareholders’ Voting Rights Agreement

 

 

IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized representatives of the Parties as of the date first above written.

 

 

	
Company:   Shanghai Rui Si Technology and Information Consulting Co., Ltd. (seal)
    
	
 
    
	
 
    	
 
    
	
Signature:
    	
/s/ Shi Wei
    	
 
    
	
 
    
	
Name: Shi Wei
    
	
 
    
	
Position: Legal Representative
    
			

 

Signature Page to Shareholders’ Voting Rights Agreement

 

 

IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized representatives of the Parties as of the date first above written.

 

 

	
Shareholder:
    
	
 
    
	
Zhang   Xi
    
	
 
    
	
 
    	
 
    
	
Signature:
    	
/s/ Zhang Xi
    	
 
    
			

 

Signature Page to Shareholders’ Voting Rights Agreement

 

 

IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized representatives of the Parties as of the date first above written.

 

 

	
Shareholder:
    
	
 
    
	
Shanghai   Xi Zhi Enterprise Management Co., Ltd. (Seal)
    
	
 
    
	
 
    
	
Signature:
    	
/s/ Zhang Xi
    	
 
    
	
 
    	
 
    
	
Name: Zhang Xi
    	
 
    
	
 
    	
 
    
	
Position: Legal Representative
    	
 
    

 

Signature Page to Shareholders’ Voting Rights Agreement

 

 

Schedule 1 Basic Information of the Company

 

Company Name: Shanghai Rui Si Technology and Information Consulting Co., Ltd.

 

Shareholding Structure:

 

	
Name of the Shareholder
    	
 
    	
 
    	
Amount of Capital
   Contribution
   (RMB/Yuan)
    	
 
    	
 
    	
Shareholding
   Percentage
    
	
Zhang Xi
    	
 
    	
 
    	
8,680,000
    	
 
    	
 
    	
62%
    
	
Shanghai Xi Zhi Enterprise Management Co., Ltd.
    	
 
    	
 
    	
5,320,000
    	
 
    	
 
    	
38%
    
	
Total
    	
 
    	
 
    	
14,000,000
    	
 
    	
 
    	
100%
    

 

Schedule 1 to Shareholders’ Voting Rights Agreement

 

 

Schedule 2:

 

Power of Attorney

 

This power of attorney (“Power of Attorney”), executed by Zhang Xi (ID Number: ) on [ ] [ ], 2017, is being issued in favor of [ ] (Domicile: [ ], ID Number/Registered Number: [ ]) (“Proxy”).

 

I, Zhang Xi, hereby grant to the Proxy a general proxy power authorizing the Proxy to exercise as my proxy and at the Proxy’s own discretion, the following rights I enjoy as a shareholder of Shanghai Rui Si Technology and Information Consulting Co., Ltd. (“Company”):

 

(1)                                          as my proxy, proposing to convene and attending the shareholders’ meetings in accordance with the articles of association of the Company;

 

(2)                                          as my proxy, exercising voting rights on all issues discussed and resolved by the shareholders’ meeting, including without limitation the appointment and election of the Company’s directors and other senior management who shall be appointed and removed by the shareholders’ meeting;

 

(3)                                          as my proxy and on my behalf, executing any document (including any necessary documents to be executed by and among relevant parties for transfer or disposal in other manner of equity interests in accordance with the Exclusive Purchase Right Agreement and Equity Pledge Agreement (including any amendment, supplement or restatement thereto from time to time)) that I am entitled to execute as a shareholder, and handling any required governmental approval, registration, filing and other procedures on my behalf;

 

(4)                                          as my proxy, exercising other shareholders’ voting rights under the articles of association of the Company (including any other shareholders’ voting rights stipulated after an amendment to such articles of association);

 

(5)                                          other shareholders’ voting rights the Shareholders are entitled to under the laws and regulations of the People’s Republic of China (including the contents thereof as modified, amended, supplemented or reenacted, effective before or after the date of issuance of this Power of Attorney).

 

The Proxy has the right to sub-entrust and is entitled to sub-entrust other individual or entity regarding the handling of the aforesaid issues without prior notice to me or prior consent of mine.

 

Schedule 2 to Shareholders’ Voting Rights Agreement

 

 

I hereby irrevocably confirm that unless Shanghai Jing Xue Rui Information and  Technology Co., Ltd. (“WFOE”) issues an instruction to me requesting the replacement of the Proxy, this Power of Attorney shall remain valid until the expiry or advance termination of the Shareholders’ Voting Rights Agreement (including any amendment or restatement thereto), executed by and among the WFOE, Shanghai Xi Zhi Enterprise Management Co., Ltd., the Company and me on [ ] [ ], 2017.

 

This Letter is hereby issued.

 

	
 
    	
Zhang Xi
    
	
 
    	
 
    
	
 
    	
Signature:
    	
 
    
	
 
    	
 
    
	
 
    	
Date: [ ] [ ],   2017
    

 

 

Schedule 2:

 

Power of Attorney

 

This power of attorney (“Power of Attorney”), executed by Shanghai Xi Zhi Enterprise Management Co., Ltd. on [ ] [ ], 2017, is being issued in favor of [ ] (Domicile: [ ], ID Number/Registered Number: [ ]) (“Proxy”).

 

Our company, Shanghai Xi Zhi Enterprise Management Co., Ltd., hereby grant to the Proxy a general proxy power authorizing the Proxy to exercise as our company’s proxy and at the Proxy’s own discretion, the following rights enjoyed by our company as a shareholder of Shanghai Rui Si Technology and Information Consulting Co., Ltd. (“Company”):

 

(1)                                          as our company’s proxy, proposing to convene and attending the shareholders’ meetings in accordance with the articles of association of the Company;

 

(2)                                          as our company’s proxy, exercising voting rights on all issues discussed and resolved by the shareholders’ meeting, including without limitation the appointment and election of the Company’s directors and other senior management who shall be appointed and removed by the shareholders’ meeting;

 

(3)                                          as our company’s proxy and on our company’s behalf, executing any document (including any necessary documents to be executed by and among relevant parties for transfer or disposal in other manner of equity interests in accordance with the Exclusive Purchase Right Agreement and Equity Pledge Agreement (including any amendment, supplement or restatement thereto from time to time)) that our company is entitled to execute as a shareholder, and handling any required governmental approval, registration, filing and other procedures on our company’s behalf;

 

(4)                                          as our company’s proxy, exercising other shareholders’ voting rights under the articles of association of the Company (including any other shareholders’ voting rights stipulated after an amendment to such articles of association);

 

(5)                                          other shareholders’ voting rights the Shareholders are entitled to under the laws and regulations of the People’s Republic of China (including the contents thereof as modified, amended, supplemented or reenacted, effective before or after the date of issuance of this Power of Attorney).

 

The Proxy has the right to sub-entrust and is entitled to sub-entrust other individual or entity regarding the handling of the aforesaid issues without prior notice to or prior consent of our company.

 

 

Our company hereby irrevocably confirms that unless Shanghai Jing Xue Rui Information and Technology Co., Ltd. (“WFOE”) issues an instruction to our company requesting the replacement of the Proxy, this Power of Attorney shall remain valid until the expiry or advance termination of the Shareholders’ Voting Rights Agreement (including any amendment or restatement thereto), executed by and among the WFOE, Zhang Xi, the Company and our company on [ ] [ ], 2017.

 

This Letter is hereby issued.

 

	
 
    	
Shanghai   Xi Zhi Enterprise Management Co., Ltd.
    
	
 
    	
 
    
	
 
    	
Signature:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Authorized   Representative:
    	
 
    
	
 
    	
 
    
	
 
    	
Date: [ ] [   ], 2017Exhibit 10.13

 

[English Translation]

 

Loan Agreement

 

This Loan Agreement (“Agreement”) is entered into by and between the following parties in Shanghai on November 1, 2017:

 

Party A: Shanghai Jing Xue Rui Information and Technology Co., Ltd.

 

Address: ***

 

Party B1: Zhang Xi

 

ID Number: ***

 

Party B2: Shanghai Xi Zhi Enterprise Management Co., Ltd. (together with Zhang Xi, “Party B”)

 

Address: ***

 

WHEREAS:

 

1.                                               Party A is a wholly foreign-owned enterprise lawfully registered and incorporated under the laws of the People’s Republic of China (“PRC”);

 

2.                                               Party B holds 100% of the equity interests in Shanghai Rui Si Technology Information Consulting Co., Ltd. (“Target Company”), among which: Party B1 holds 62% of the equity interests in the Target Company; and Party B2 holds 38% of the equity interests in the Target Company.

 

3.                                               Party A intends to provide Party B with loans for the purpose provided under this Agreement.

 

NOW, THEREFORE, the Parties enter into this Agreement to specify the terms and conditions of such loans as follows:

 

1.                                               Loans

 

1.1                                        Party A agrees to provide loans without interest for Party B pursuant to the terms and conditions of this Agreement, the amount of which shall be separately agreed in writing between the Parties; Party B agrees to accept such loans pursuant to the terms and conditions of this Agreement and apply it for the purpose of funding  business development of the Target Company or other purposes agreed by Party A.

 

 

2.                                               Term of the Loans

 

2.1                                        Except for the circumstances under Section 3.1 of this Agreement, the term of the loans provided by Party A for Party B under this Agreement shall be ten (10) years from the date of this Agreement; the term of the loans shall be automatically extended by ten years upon its expiry and shall be automatically further extended by ten years upon each expiry. At any time during the term of the loans or any extended term of the loans, Party A is entitled to send a written notice to Party B requesting the repayment of the loans and Party B shall repay the loans within thirty (30) days after receipt of such written notice. Without Party A’s written notice, Party B shall not make prepayment of the loans during the term of the loans or any extended term of the loans.

 

3.                                               Repayment of the Loans

 

3.1                                        During the term of the loans or any extended term of the loans, if any of the following circumstances occurs to any party of Party B, Party A is entitled to determine by written notice that all loans owed by such party of Party B to Party A become immediately due and such party of Party B shall repay the loans in the manner stipulated in this Agreement:

 

(1)                       such party of Party B fails to repay any of its other indebtedness when it becomes due and payable, or there is occurrence of any other material personal indebtedness that may affect its capability of repayment under this Agreement;

 

(2)                       such party of Party B, in case it is a natural person, deceases, has no civil capability or limited civil capability;

 

(3)                       such party of Party B ceases to be a shareholder of the Target Company for any reason;

 

(4)                       such party of Party B commits any criminal act or is involved in any criminal activities;

 

(5)                       A claim with a value more than RMB1,000,000 is made against such party of Party B  by any third party;

 

(6)                       any Event of Default (as defined in the Equity Pledge Agreement) occurs; or

 

(7)                       to the extent permitted by PRC laws, Party A can directly hold equity interests in the Target Company and the Target Company can lawfully continue its business as currently operated, and Party A has sent a written notice pursuant to Section 3.2 under this Agreement to Party B regarding the purchase of its equity interests in the Target Company to exercise its purchase right.

 

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3.2                                        The Parties hereby agree and acknowledge that to the extent permitted by PRC laws, Party A is entitled but not obligated to at any time purchase or designate any other person (including natural persons, legal persons or other entities) to purchase all or part of Party B’s equity interests in the Target Company (“Purchase Right”). Upon Party A’s issuance of written notice to exercise its Purchase Right, Party B shall, as intended and instructed by Party A, immediately transfer all its equity interests in the Target Company at the lowest price permissible under then applicable laws and regulations to Party A or such person designated by Party A. The Parties agree to execute separate agreements with other applicable parties regarding the aforesaid matter.

 

3.3                                        The Parties hereby agree and acknowledge that Party B shall repay the loans under this Agreement to Party A only in the following manner: upon maturity or accelerated maturity of the loans under this Agreement, Party B (or its successor or transferee) shall, pursuant to the requirements in Party A’s written notice, transfer its equity interests in the Target Company to Party A or any person designated by Party A to the extent permitted by PRC laws, and repay the loans provided by Party A to Party B under this Agreement with proceeds from such transfer of equity interests. Party A shall provide unconditional financial support to the Target Company on reliance of this Agreement or other agreement. Notwithstanding anything to the contrary under this Agreement, Party A hereby irrevocably agrees that if Party B is unable (for example, not permitted by laws) to repay the loans under this Agreement, Party A shall waive its right to claim the repayment of the loans from Party B.

 

3.4                                        The Parties hereby agree and acknowledge that, unless otherwise agreed under this Agreement, Party A shall not charge any interest on the loans provided for Party B. Notwithstanding the foregoing, when the loans are due and Party B is required to transfer its equity interests to Party A or any person designated by Party A, if the actual transfer price of Party B’s equity interests in the Target Company (“Corresponding Equity”) is higher than the principal of the loans provided to Party B due to legal requirements or any other reason, the portion of the proceeds from transfer of the Corresponding Equity by Party B in excess of such principal shall constitute interest accrued upon the loans or costs of funding commitment and shall be repayable to Party A together with the principal of the loans.

 

3.5                                        The Parties hereby agree and acknowledge that, Party B is deemed to have fulfilled its repayment obligations under this Agreement only when the following conditions are all satisfied:

 

(1)                       to the extent permitted by PRC laws, Party B has transferred all of its equity interests in the Target Company to Party A and/or any person designated by Party A; and

 

(2)                       Party B has used all of the proceeds from the transfer of Corresponding Equity (including the principal of the loans and the highest interest accrued upon the loans or funding costs permitted by then applicable laws) as to Party A repayment of the loans.

 

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4.                                               Security

 

4.1                                        In order to secure repayment of the debts under this Agreement, Party B agrees to pledge all of its equity interests in the Target Company to Party A (“Equity Pledge”).

 

4.2                                        The Parties acknowledge that other than the loans contemplated under this Agreement, the debts secured by the Equity Pledge shall also include all the debts and obligations of Party B and/or the Target Company owed to Party A under the Exclusive Technology and Consultation Service Agreement, Exclusive Purchase Right Agreement and Shareholders’ Voting Rights Agreement, each executed by the parties thereto on the date of this Agreement. The Parties agree to separately execute the Equity Pledge Agreement with applicable parties regarding the aforesaid matter.

 

5.                                               Representations and Warranties

 

5.1                                        Party A represents and warrants to Party B that:

 

(1)                       It is a limited liability company duly registered and lawfully existing under the laws of its place of registration with independent legal personality; it has full and independent legal status and legal capacity to execute, deliver and perform this Agreement, and has been duly authorized to execute, deliver and perform this Agreement, and may sue or be sued as an independent party;

 

(2)                       It has full internal corporate power and authority to execute and deliver this Agreement and all other documents to be executed by it in connection with the transactions contemplated in this Agreement as well as full power and authority to consummate the transactions contemplated under this Agreement. This Agreement is lawfully and duly executed and delivered by it. The execution and performance of this Agreement by it do not violate or conflict with any law applicable to it in effect, any agreement to which it is a party or by which its assets are bound, any court judgment, any arbitral award, or any decision of any administrative authority. This Agreement constitutes lawful and binding obligations enforceable against it in accordance with the terms of this Agreement;

 

(3)                       The principal of the loans provided by Party A for Party B is lawfully owned by Party A.

 

5.2                                        Party B represent and warrant to Party A that:

 

(1)                       Party B are natural persons with full civil capacity; they have full and independent legal status and legal capacity, and have been duly authorized to execute, deliver and perform this Agreement, and may sue or be sued as an independent party;

 

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(2)                       They have the full power and authority to execute and deliver this Agreement and all other documents to be executed by it in connection with the transactions contemplated in this Agreement as well as full power and authority to consummate the transactions contemplated in this Agreement. The entry into and performance of this Agreement by them do not violate or conflict with any law applicable to them in effect, any agreement to which they are a party or by which their assets are bound, any court judgment, any arbitral award, or any decision of any administrative authority. This Agreement is lawfully and duly executed and delivered by them. This Agreement constitutes lawful and binding obligations enforceable against them in accordance with the terms of this Agreement. The execution and performance of this Agreement by them comply with the Target Company’s articles of association or other organizational documents;

 

(3)                       There is no pending or threatened dispute, litigation, arbitration, administrative proceedings or any other proceedings in which Party B is involved;

 

(4)                       This Agreement constitutes lawful and effective obligations enforceable against Party B in accordance with relevant laws;

 

(5)                       Other than the pledge created under the Equity Pledge Agreement (including any amendment, supplement or restatement thereto from time to time) executed by Party B on the date of this Agreement in respect of the Equity Pledge and the proxy rights created under the Shareholders’ Voting Rights Agreement (including any amendment, supplement or restatement thereto from time to time) executed by Party B on the date of this Agreement, Party B have not created any lien, pledge, or any other security on their equity interests in the Target Company, have not issued any offer to any third party on transfer of such equity interests, have not accepted any offer issued by any third party to purchase such equity interests, and have not executed any agreement regarding the transfer of Party B’s equity interests in the Target Company with any third party.

 

5.3                                        Party B undertake that, during the term of this Agreement:

 

(1)                       Without prior written consent of Party A, they shall not use the loans for any purpose other than as agreed in this Agreement;

 

(2)                       Without prior written consent of Party A, they shall not sell, transfer, pledge or otherwise dispose of, or permit to create any encumbrances on (including direct or indirect sale, transfer, pledge or disposal in any manner of the equity interests in the Target Company or relevant rights and interests thereof (and if Party B hold equity interests in the company indirectly through any intermediary, they shall not sell, transfer, pledge in any manner or otherwise dispose of their equity interests and rights and interests thereof in such intermediary, and shall ensure such intermediary will not issue equity interests to any third party)) any lawful or beneficial rights and interests of their equity interests in the Target Company at any time from the date of this Agreement, other than the pledge created on the equity interests in the Target Company under the Equity Pledge Agreement (including any amendment, supplement or restatement thereto from time to time) executed by the parties thereto on the date of this Agreement and the proxy rights created on the equity interests in the Target Company under the Shareholders’ Voting Rights Agreement (including any amendment, supplement or restatement thereto from time to time) executed by the parties thereto on the date of this Agreement;

 

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(3)                       Without prior written consent of Party A, they shall not, during the shareholders’ meeting of the Target Company, vote in favor of, support or execute any shareholders’ resolution to approve the sale, transfer, pledge or disposal in any other manner of, or permit to create any encumbrances on any lawful or beneficial rights and interests of any equity interests or assets, except made to Party A or its designated entity or individual;

 

(4)                       Without prior written consent of Party A, they shall not in any manner agree, support or approve merger or consolidation of the Target Company with any other entity, merger or acquisition of the Target Company by any other entity, or investment by the Target Company in any entity, or split-up of the Target Company, change in the registered capital or the form of the Target Company;

 

(5)                       Each time Party A exercises its Purchase Right of the equity interests, they shall cause the Target Company to promptly convene a shareholders’ meeting and vote in favor of the transfer of the purchased equity interests under this Agreement;

 

(6)                       At Party A’s request at any time, they shall immediately transfer their equity interests in the Target Company to Party A and/or its designated person and waive their rights of first refusal regarding the equity interests of the Target Company;

 

(7)                       At the request of Party A, they shall immediately inform Party A of any actual or potential litigation, arbitration or administrative proceedings regarding their equity interests;

 

(8)                       Prior to the transfer of their equity interests to Party A, they shall execute all necessary or proper documents, take all necessary or proper actions, raise all necessary and proper claims of right, or make all necessary or proper defenses against claims of compensation so as to maintain the ownership of their equity interests;

 

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(9)                       If Party B sell their equity interests in the Target Company to the extent permitted by Party A, they shall repay the loans to Party A with all the proceeds received from such sale in priority;

 

(10)                At the request of Party A, they shall appoint or engage the persons designated by Party A as directors and senior management members of the Target Company;

 

(11)                Without prior written consent of Party A, they shall not, and shall cause the management of the Target Company not to,  dispose of any material company assets (other than that incurred in the ordinary course of business);

 

(12)                Without prior written consent of Party A, they shall not, and shall cause the management of the Target Company not to,  terminate any material agreements entered into by the Target Company or enter into any other agreements in conflict with such existing material agreements;

 

(13)                Without prior written consent of Party A, they shall not appoint or remove any director, supervisor or any other management member of the Target Company who shall be appointed and removed by the existing shareholders;

 

(14)                Without prior written consent of Party A, they shall cause the Target Company not to declare or make any distribution of any distributable profits, bonuses or dividends;

 

(15)                They shall ensure that the Target Company will maintain its valid existence and will not be terminated, liquidated or dissolved without prior written consent of Party A;

 

(16)                Without prior written consent of Party A, they shall not cause or agree to any amendment by the Target Company of its articles of association;

 

(17)                Without prior written consent of Party A, they shall not cause or agree to any material change by the Target Company of its business scope, or termination or suspension by the Target Company of any of the business currently conducted by the Target Company;

 

(18)                Without prior written consent of Party A, they shall ensure that the Target Company will not lend or borrow money (other than that required in the ordinary course of business), provide guarantee or any other form of security, or assume any substantial obligations beyond its ordinary course of business;

 

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(19)                Without prior written consent of Party A, they shall not cause or agree to any related party transaction between the Target Company and any of its direct or indirect shareholders, directors, supervisors, management or their respective affiliates;

 

(20)                Without prior written consent of Party A, they shall not conduct any action or omission that will cause conflict of interest between them and the company or Party A;

 

(21)                Without prior written consent of Party A, they shall not conduct any action or omission which is likely to impair the assets or goodwill of the Target Company or affect the validity of the business permits of the Target Company;

 

(22)                They shall promptly inform Party A of any circumstances to their knowledge which are likely to have a material adverse effect on the existence, business operation, financial conditions, assets or goodwill of the Target Company;

 

(23)                Without prior written consent of Party A, they shall not cause or agree to any material amendment by the Target Company to its accounting policies or to any change by the Target Company of its accountants ;

 

(24)                They shall strictly comply with all the provisions in this Agreement and any other agreements jointly or severally executed by the parties thereto, duly perform all obligations under such agreements, and shall not conduct any action or omission which is capable to affect the validity and enforceability of such agreements.

 

For the purpose of this Section 5.3, “Target Company” shall refer to the Target Company and all of its subsidiaries (unless otherwise required by the context).

 

6.                                               Liability for Default, Governing Law and Dispute Resolution

 

6.1                                        Any Party whose breach of this Agreement results in all or any part of this Agreement being incapable to be performed shall be liable for such breach and indemnify the other Party for its losses thereby incurred (including any litigation fee and legal fee incurred thereby); if both Parties are in breach of this Agreement, they shall bear corresponding liabilities respectively based on actual situations. If Party B fail to perform their repayment obligations within the term under this Agreement, they shall pay overdue interest at 0.01% of the amount overdue and payable on daily basis until the date of repayment of all principals, overdue interest and other amounts.

 

6.2                                        The entry into, effectiveness, interpretation and the dispute resolution of this Agreement shall be governed by PRC laws.

 

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6.3                                        Any dispute arising out of or in connection with this Agreement shall be resolved by the Parties through consultations and shall, in the absence of an agreement being reached by the Parties within thirty (30) days from its occurrence, be submitted by any Party to China International Economic and Trade Arbitration Commission (“CIETAC”) for arbitration in accordance with the then effective arbitration rules of CIETAC. The place of arbitration shall be Beijing and the language for arbitration shall be Chinese. The arbitration award shall be final and binding on the Parties to this Agreement.

 

7.                                               Confidentiality

 

7.1                                        Prior to the entry into and during the term of this Agreement, a Party (“Disclosing Party”) disclosed or may from time to time disclose confidential information (including without limitation operation information, clients materials, financial materials, and contracts) to the other Party (“Receiving Party”). The Receiving Party shall keep the confidential information in confidence and shall not use such confidential information except for the purposes explicitly provided under this Agreement. The preceding sentence is not applicable to any information (a) that has already been obtained by the Receiving Party with evidence prepared in writing prior to the Disclosing Party’s disclosure of such information, (b) that becomes or may become public not due to the Receiving Party’s breach of contract; (c) acquired by the Receiving Party from a third party that has no confidentiality obligations regarding such information; and (d) disclosed by either Party in accordance with relevant laws, regulations, courts, arbitration institutions or regulatory authorities, or any information disclosed to the legal or financial advisors, lenders or potential lenders (including the agents or trustees of the lenders), and financing arrangers or potential financing arrangers of such Party or its related parties in its ordinary course of business.

 

7.2                                        This Article 7 shall bind upon the Parties regardless of termination or expiry of this Agreement.

 

8.                                               Force Majeure

 

8.1                                        A “Force Majeure” event refers to any event which is unforeseeable, unavoidable and/or insurmountable, resulting in the inability of either Party to this Agreement to perform all or part of this Agreement. Such event shall include without limitation earthquakes, typhoons, floods, fires, wars, strikes, turbulence, governmental actions, and changes in laws or the application thereof.

 

8.2                                        If a Force Majeure event occurs, a Party’s obligations under this Agreement affected by Force Majeure shall be automatically suspended during the delay period caused by such Force Majeure event and the term of performance of such obligations shall be automatically extended by such term of suspension, and such Party shall not be punished or assume any liability for such reason. In occurrence of a Force Majeure event, the Parties shall negotiate immediately to seek a fair solution, and shall make all reasonable efforts to reduce the impact of such Force Majeure event to the minimum.

 

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9.                                               Miscellaneous

 

9.1                                        Any approval, instruction, demand, notice, exercise or waiver of any right, or other action of Party A shall be made in writing and attached with the resolutions of relevant shareholders’ meeting, board of directors or similar decision-making body of such company’s offshore indirect holding company (ONESMART EDUCATION GROUP LIMITED) approving thereof (provided that such approval is required under the articles of association of ONESMART EDUCATION GROUP LIMITED).

 

9.2                                        This Agreement shall be formed and become effective upon execution/fixture of seal by the Parties or their authorized representatives.  After the date hereof, this Agreement may not be amended unless mutually agreed by the Parties in writing.

 

9.3                                        This Agreement is severable and any invalidity or unenforceability of any specific provision shall not affect the validity and enforceability of other provisions of this Agreement.

 

9.4                                        No failure or delay by a Party in exercising any right under this Agreement shall operate as waiver of such right by such Party; and the exercise or partial exercise of any right by such Party shall not prevent it from exercising such right again in the future.

 

9.5                                        This Agreement shall be binding upon the Parties and their respective inheritors, successors and permitted transferees and shall be entered into solely for the interests of the aforesaid people. Without prior written consent of Party A, Party B shall not transfer, pledge or otherwise transfer any of its rights, interests or obligations under this Agreement.

 

9.6                                        Party B hereby agree that Party A is entitled to transfer any of its rights and obligations under this Agreement to other third party when needed and without prior notice to or consent of Party B. Without prior written consent of Party A, Party B shall not transfer any of its rights and obligations under this Agreement to any third party.

 

9.7                                        The notices under this Agreement shall be delivered in person, by facsimile or by registered post to the following addresses unless changed by written notifications. The delivery date of the notice shall be the receiving date on the receipt if delivered by registered post, or the date of delivering to the recipient if delivered in person or by facsimile. If delivered by facsimile, the original notice should be immediately sent to the following addresses in person or by registered post after such delivery.

 

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Party A: Shanghai Jing Xue Rui Information and Technology Co., Ltd.

Registered Address: ***

Tel: ***

Recipient: ***

 

Party B: Zhang Xi, Shanghai Xi Zhi Enterprise Management Co., Ltd.

Domicile: ***

Tel: ***

Recipient: ***

 

9.8                                        This Agreement is made in Chinese in three (3) originals, each of which shall have equal legal effect.

 

[Intentionally left blank below]

 

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IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized representatives of the Parties as of the date first above written.

 

	
Party A:
    	
 
    
	
 
    	
 
    
	
Shanghai   Jing Xue Rui Information and Technology Co., Ltd. (seal)
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
/s/ Meng Xiaoqiang
    	
 
    
	
 
    	
 
    
	
Name:   Meng Xiaoqiang
    	
 
    
	
 
    	
 
    
	
Position: Legal Representative
    	
 
    

 

Signature Page to Loan Agreement

 

 

IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized representatives of the Parties as of the date first above written.

 

Party B:

 

Zhang Xi

 

	
Signature:
    	
/s/ Zhang Xi
    	
 
    

 

Signature Page to Loan Agreement

 

 

IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized representatives of the Parties as of the date first above written.

 

	
Party B:
    	
 
    
	
 
    	
 
    
	
Shanghai   Xi Zhi Enterprise Management Co., Ltd. (Seal)
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
/s/ Zhang Xi
    	
 
    
	
 
    	
 
    
	
Name:   Zhang Xi
    	
 
    
	
 
    	
 
    
	
Position: Legal Representative
    	
 
    

 

Signature Page to Loan Agreement

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