Document:

Exhibit 10.1

 

(ted)
Employment Agreement

 

This
EMPLOYMENT AGREEMENT (the “Agreement”), is entered into as of December 11, 2017, by and between Helios And
Matheson Analytics Inc., a Delaware corporation (the “Company”), and Theodore Farnsworth (“Executive”).

 

WHEREAS,
the Company recognizes that the Executive has had and is expected to continue to have a critical and essential role in guiding
the Company and in developing the Company’s business;

 

WHEREAS,
the Executive is expected to make major contributions to the stability, growth and financial strength of the Company;

 

WHEREAS,
the Company has determined that appropriate arrangements should be taken to encourage the continued attention and dedication of
the Executive to his assigned duties without distraction;

 

WHEREAS,
in consideration of the Executive’s employment with the Company, the Company desires to provide the Executive with certain
compensation and benefits as set forth in this Agreement;

 

WHEREAS,
as of the date of this Agreement, the Company wishes to continue Executive’s service as a Chief Executive Officer under
the terms of an employment agreement on the terms set forth herein, which shall supersede all previous agreements regarding Executive’s
employment by the Company; and

 

WHEREAS,
the Executive desires to be employed by the Company on the terms contained in this Agreement.

 

NOW,
THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

 

1. Position
and Duties. 

 

(a) The
Executive shall serve as the Chief Executive Officer of the Company reporting to the Company’s Board of Directors (the “Board”).
The Executive shall primarily work out of 444 Brickell Avenue, Miami, Florida 33131 (the “Executive’s Office”).

 

(b) The
Company agrees to propose to the shareholders of the Company at each appropriate meeting of such shareholders during the Term
and any Renewal Term, the election and reelection of the Executive as a member of the Board. Provided the Executive is elected
by the shareholders to the Board, the Executive shall be appointed Chairman of the Board. In addition, without further compensation,
the Executive shall serve as a director or officer of one or more of the Company’s subsidiaries or affiliates if so elected
or appointed from time to time. 

 

(c) The
Executive shall have such duties, authority and responsibilities as are consistent with the role of Chief Executive Officer and
as may be set forth in the Bylaws of the Company. For purposes of the applicability of the Company compensation plans to the Executive,
Executive shall be considered an “employee.” Executive shall devote a substantial amount of his business time to the
performance of his duties hereunder, but such requirement shall not prevent Executive from (i) serving as a member of the board
of directors of unaffiliated companies, (ii) serving on civic, charitable, educational, religious, public interest or public service
boards, (iii) managing the Executive’s personal and family investments, and (iv) engaging in or having an ownership interest
in other businesses. In addition, the Executive has disclosed, in writing, to the Company his involvement in entities and investments
other than the Company (collectively, the “Outside Activities”). The Company shall permit the Executive to
continue to engage in the Outside Activities provided that the Executive agrees to disclose to the Board, in writing, any actual
or potential conflict of interest arising out of any such Outside Activity and no such Outside Activity materially interferes
with Executive’s ability to perform his responsibilities hereunder.

 

     

     

    

 

2. Term.
This Agreement and Executive’s employment hereunder shall be for an initial term of five (5) years commencing on the
date hereof (the “Effective Date”) and ending on the fifth anniversary of the Effective Date (the “Expiration
Date”), unless terminated earlier by the Company or the Executive pursuant to Section 4 of this Agreement (the “Term”).
Thereafter, this Agreement shall automatically be renewed and the Term shall be extended for additional consecutive terms of 1
year (each a “Renewal Term”), unless such renewal is objected to by either the Company or the Executive upon
90 days written notice prior to the commencement of the next Renewal Term. In the event of renewal, the last day of each Renewal
Term shall be deemed the new Expiration Date.

 

3. Compensation
and Related Matters.

 

(a) Base
Salary. The Executive’s initial annual base salary shall be $325,000, less applicable withholdings (the “Base
Salary”). The Base Salary shall be payable in accordance with the Company’s normal payroll procedures in effect
from time to time. On each anniversary of this Agreement the base salary will increase no less than $15,000 (“minimum”).
The Board shall review the Base Salary annually and may increase the Base Salary more than the minimum, and the term “Base
Salary” shall refer to such increased amount. 

 

(b) Annual
Bonus. For 2017, the Executive shall receive a cash bonus in the amount of $350,000 payable on or before December 29, 2017,
and an award of 53,255 shares of Company common stock, which shall vest in their entirety on February 15, 2019, (the “Principal
Market”), which shall be received by the Executive no later than March 15, 2018. After 2017 and during the Term, the
Executive will receive an annual cash bonus and an annual award of shares of common stock, subject to vesting conditions, in respect
of each full or partial fiscal year of the Company, as well as other cash or equity bonuses, as determined in the sole discretion
of the Board based on its assessment of Company and individual performance in relation to performance targets, a subjective evaluation
of Executive’s performance or such other criteria as may be established by the Board (the “Annual Bonus”).
The Annual Bonus will be paid no later than the 75th day following the end of the fiscal year to which the Annual Bonus
relates. The annual cash target bonus is 25% of the Base Salary and the value of the annual award of shares of Company common
stock, as of the date of the grant, will be equal to 200% of the Base Salary as determined by the closing price of the common
stock on the Principal Market on the date of grant (which shares of common stock shall vest ratably at the end of each of the
six calendar quarters subsequent to the calendar quarter in which the grant is made). Any award of common stock pursuant to this
Agreement shall be subject to the Company’s receipt of all corporate approvals required by applicable law or the rules and
regulation of the Principal Market and the terms of a Restricted Stock Award Agreement between Executive and the Company to be
agreed upon following the execution of this Agreement and prior the issuance of any common stock award to the Executive (each,
an “Award Agreement”). 

 

(c) Milestone
Bonuses. In addition to any other compensation to which the Executive is entitled, upon the Company initially attaining any
of the milestones set forth on Schedule 1 hereof, Executive will be entitled to awards of common stock calculated in accordance
with Schedule 1 hereof. Any such award of common stock shall be subject to the terms of the applicable Award Agreement.

 

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(d) Capital
Raise Bonus For Extraordinary Performance in 2017. Upon the execution of this Agreement, the Executive shall become entitled
to receive a one-time bonus of $1,000,000 for his extraordinary efforts above and beyond his duties as the Chief Executive Officer,
specifically with respect to bringing capital sources that have been critical to the Company’s needs in 2017, which shall
be paid to the Executive no later than December 29, 2017. The Executive may, in his sole discretion, subject to the Company’s
and the Executive’s compliance with applicable legal and regulatory requirements, elect to accept unregistered shares of
common stock of the Company in lieu of the cash bonus described above, valued based on the last closing price of the common stock
on Nasdaq preceding the execution of this Agreement. 

 

(e) Long
Term Incentive Plan. The Executive shall be entitled to participate in all bonus or other compensation programs adopted by
the Company and applicable generally to senior executives of the Company.

 

(f) Equity
Incentive Plan. The Executive shall be awarded shares of common stock of the Company, subject to vesting conditions, as set
forth in Exhibit A hereto, subject to the terms of the applicable Award Agreement. Additionally, the Executive shall be
entitled to participate in any and all plans providing for awards of equity or instruments convertible into equity adopted by
the Company and applicable generally to other senior executives of the Company.

 

(g) Business
Expenses. The Company shall promptly reimburse the Executive for all reasonable and necessary business-related expenses incurred
in connection with the performance of the Executive’s duties hereunder in accordance with the policies and procedures then
in effect and established by the Company for its senior executive officers, provided that the Executive furnishes the Company
with all supporting information and documentation relevant to such expenses as the Company may reasonably request. The Executive
is entitled, though not required, to travel first class or business class on all domestic and international flights. If the Executive
leases an apartment in New York City in connection with duties that the Executive is providing to the Company or its affiliates,
the Executive shall provide the Company with a copy of the lease and the Company shall pay the rent directly to the landlord.
In connection with such lease, the Executive shall provide the Company with a schedule of all trips that the Executive makes to
New York City in order to conduct business relating to the Company or its affiliates.

 

(h) Health
Insurance. Executive shall be entitled to participate in any Company health insurance plan on the same terms and conditions
as other Company senior executives are permitted to participate.

 

(i) Life
Insurance. To the extent practicable, the Company shall, during the Term, pay the premiums of a life insurance policy, providing
coverage in the amount of $3,000,000, payable to a beneficiary chosen by Executive, which insures the life of Executive. Executive
shall provide all information and cooperation reasonably necessary to obtain such life insurance policy. 

 

(j) Automobile
Allowance. During the Term, Executive shall receive a monthly automobile allowance in the amount of $750.00 per month for
automobile-related expenses.

 

(k) Other
Benefits. The Executive shall be entitled to participate in all pension, savings and retirement plans, welfare and insurance
plans, practices, policies, programs and perquisites of employment applicable generally to other senior executives of the Company.

 

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(l) Vacation.
The Executive shall be entitled to accrue up to 20 paid vacation days in each year, which shall be accrued ratably. The Executive
shall also be entitled to all paid holidays given by the Company to its executives and employees. Any unused vacation days shall
be rolled forward to be used in future years, provided that vacation days shall not accrue further if Executive has 30 accrued
but unused vacation days. 

 

(m) Sick
Days. The Executive shall be entitled to accrue up to 5 paid sick days in each year, which shall be accrued ratably. Any unused
sick days shall be rolled forward to be used in future years, provided that sick days shall not accrue further if Executive has
10 accrued but unused sick days.

 

(n) Withholding.
All amounts payable to the Executive under this Section 3 shall be subject to all required federal, state and local withholding,
payroll and insurance taxes and requirements.

 

4. Termination.

 

(a) Death.
The Executive’s employment hereunder shall terminate upon his death.

 

(b) Disability.
The Company may terminate the Executive’s employment if the Executive becomes subject to a Disability. For purposes of this
Agreement, “Disability” means the Executive is unable to perform the essential functions of his position as
CEO, with or without a reasonable accommodation, for a period of 120 consecutive days or 180 days during any rolling consecutive
12 month period.

 

(c) Termination
by Company for Cause. The Company may terminate the Executive’s employment for Cause. For purposes of this Agreement,
“Cause” means the Executive’s: (i) willful misconduct, gross negligence, fraud, embezzlement
or other material dishonesty with respect to the affairs of the Company or any of its affiliates; (ii) material failure to meet
minimum performance expectations of the Board; (iii) conviction, plea of nolo contendere, guilty plea, or confession to
either a felony or any lesser crime relating to the affairs of the Company or any of its affiliates or of which fraud, embezzlement,
or moral turpitude is a material element; or (iv) a material breach of this Agreement or a breach of a fiduciary duty owed
to the Company, provided that any such breach, if curable, shall not constitute Cause unless the Company has provided the Executive
with (x) written notice of the acts or omissions giving rise to a termination of his employment for Cause; (y) the opportunity
to correct the act or omission within 30 days after receiving the Company’s notice (the “Cure Period”);
and (z) an opportunity to be heard before the Board with the Executive’s counsel present prior to the expiration of the
Cure Period. 

 

(d) Termination
by the Company without Cause. The Company may not terminate the Executive’s employment during any Term or Renewal Term
without Cause. 

 

(e) Termination
by the Executive. The Executive may terminate his employment at any time for any reason other than a Good Reason, upon 30
days prior written notice. 

 

(f) Termination
by the Executive for Good Reason. The Executive may terminate his employment for Good Reason by providing written notice.
For purposes of this Agreement, “Good Reason” means: (i) a material reduction in the Executive’s Base
Salary; (ii) a material diminution in the Executive’s responsibilities as CEO; (iii) the assignment of duties to the Executive
materially inconsistent with his position as CEO; (iv) the requirement that the Executive relocate his primary place of employment
more than 20 miles from Executive’s Office (unless such location is closer to the Executive’s primary residence);
or (v) the Company’s material breach of this Agreement; provided that Good Reason based on a material breach shall exist
only if within 90 days of the Company’s act or omission resulting in a material breach, the Executive notifies the Company
in a writing of the act or omission, the Company fails to correct the act or omission within 30 days after receiving the Executive’s
written notice and the Executive actually terminates his employment within the 30 days following the end of such 30-day cure period.

 

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(g) Expiration.
Executive’s employment shall terminate on the Expiration Date.

 

(h) Termination
Date. The “Termination Date” means: (i) if the Executive’s employment is terminated by his death
under Section 4(a), the date of his death; (ii) if the Executive’s employment is terminated on account of his Disability
under Section 4(b), the date on which the Company provides the Executive a written termination notice; (iii) if the Company terminates
the Executive’s employment for Cause under Section 4(c), the date on which the Company provides the Executive a written
termination notice, unless the circumstances giving rise to the termination are subject to the Cure Period, in which case the
date on which the Company provides the Executive a written termination notice following the end of the Cure Period; (iv) if, despite
the restriction against doing so under Section 4(d), the Company terminates the Executive’s employment without Cause under
Section 4(d), 90 days after the date on which the Company provides the Executive a written termination notice; (v) if the Executive
resigns his employment without Good Reason under Section 4(e), 30 days after the date on which the Executive provides the Company
a written termination notice; (vii) if the Executive resigns his employment with Good Reason under Section 4(f), the date on which
the Executive provides the Company a timely written termination notice, except the Termination Date shall be the last day of the
relevant 30-day cure period, if applicable; and (viii) the Expiration Date if the Executive’s employment terminates under
Section 4(g).

 

5. Compensation
upon Termination.

 

(a) Termination
by the Company for Cause; by the Executive without Good Reason; or upon the Expiration Date following the Executive’s election
not to Renew. If the Executive’s employment with the Company is terminated pursuant to Section 4(c), 4(e), or 4(g),
the Company shall pay or provide to the Executive the following amounts through the applicable Termination Date: any earned but
unpaid Base Salary, unpaid expense reimbursements, any earned but unpaid Annual Bonus, and the value of any accrued and unused
vacation days (the “Accrued Obligations”) on or before the time required by law but in no event more than 30
days after the Executive’s Termination Date.

 

(b) Death;
Disability. If the Executive’s employment terminates because of his death as provided in Section 4(a) or because of
a Disability as provided in Section 4(b), then the Executive (or his authorized representative or estate) shall be entitled to
the following: 

 

(i) the
Accrued Obligations earned through the applicable Termination Date (payable on or before the time required by law but in no event
more than 30 days after the applicable Termination Date);

 

(ii) a
pro-rata portion of the Executive’s Annual Bonus, if any, for the fiscal year in which the Executive’s termination
occurs (determined by multiplying the amount of such bonus which would be due for the full fiscal year by a fraction, the numerator
of which is the number of days during the fiscal year of termination that the Executive is employed by the Company and the denominator
of which is 365) payable at the same time bonuses for such year are paid to other senior executives of the Company;

 

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(iii) vest
the Executive on the applicable Termination Date for any and all previously granted outstanding equity-incentive awards subject
to time-based vesting criteria as if the Executive continued to provide services to the Company for 12 months following the applicable
Termination Date;

 

(iv) Subject
to the Executive’s or, in the event of his death, his eligible dependents’ timely election of continuation coverage
under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), the Company shall reimburse
the Executive or his eligible dependents the monthly premium payable to continue his and his eligible dependents’ participation
in the Company’s group health plan (to the extent permitted under applicable law and the terms of such plan) which covers
the Executive (and the Executive’s eligible dependents) for a period of eighteen (18) months, provided that the Executive
is eligible and remains eligible for COBRA coverage; and provided, further, that in the event that the Executive
obtains other employment that offers group health benefits, such continuation of coverage by the Company shall immediately cease.
 If the reimbursement of any COBRA premiums would violate the nondiscrimination rules or cause the reimbursement of claims
to be taxable under the Patient Protection and Affordable Care Act of 2010, together with the Health Care and Education Reconciliation
Act of 2010 (collectively, the “Act”) or Section 105(h) of the Internal Revenue Code (the “Code”),
the Company paid premiums shall be treated as taxable payments and be subject to imputed income tax treatment to the extent necessary
to eliminate any discriminatory treatment or taxation under the Act or Section 105(h) of the Code; and

 

(v) in
the case of a termination due to Disability, in addition to the aforementioned awards, continuation of the Base Salary in effect
on the Termination Date until the earlier of (A) the 12 month anniversary of the Termination Date, and (B) the date Executive
is eligible to commence receiving payments under the Company’s long-term disability policy. If the net compensation from
the Base Salary is greater than the net compensation from the long-term disability policy, the Company, through the 12 month anniversary
of the Termination Date will compensate the Executive’s estate the difference in net compensation.

 

(c) Termination
by the Company without Cause, by the Executive with Good Reason. If the Executive’s employment is terminated by the
Company without Cause despite the restriction against doing so under Section 4(d), or the Executive terminates his employment
for Good Reason as provided in Section 4(f), then the Executive shall, except to the extent Section 5(d) is applicable, be entitled
to the following:

 

(i) the
Accrued Obligations earned through the applicable Termination Date (payable on or before the time required by law but in no event
more than 30 days after the applicable Termination).

 

(ii) severance
in a single lump sum installment in an amount equal to 2x the sum of (A) the Base Salary at the rate in effect on the Termination
Date, plus (B) an amount equal to 2x the maximum Annual Bonus for which the Executive is eligible in the fiscal year in which
the Termination Date occurs, or if, there is no Annual Bonus for which he is eligible in the fiscal year in which the Termination
Date occurs, 2x the Annual Bonus most recently issued to the Executive. The severance is payable no later than 30 days following
the applicable Termination Date.

 

(iii) A
pro-rata portion of the Executive’s Annual Bonus, if any, for the fiscal year in which the Executive’s termination
occurs (determined by multiplying the amount of such bonus which would be due for the full fiscal year by a fraction, the numerator
of which is the number of days during the fiscal year of termination that the Executive is employed by the Company and the denominator
of which is 365) payable at the same time bonuses for such year are paid to other senior executives of the Company.

 

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(iv) full
vesting of the Executive in any and all previously granted outstanding equity-based incentive awards subject to time-based vesting
criteria.

 

(v) Subject
to the Executive’s timely election of continuation coverage under COBRA, the Company shall reimburse the Executive the monthly
premium payable to continue his and his eligible dependents’ participation in the Company’s group health plan (to
the extent permitted under applicable law and the terms of such plan) which covers the Executive (and the Executive’s eligible
dependents) for a period of 18 months, provided that the Executive is eligible and remains eligible for COBRA coverage;
and provided, further, that in the event that the Executive obtains other employment that offers group health benefits,
such continuation of coverage by the Company shall immediately cease.  If the reimbursement of any COBRA premiums would violate
the nondiscrimination rules or cause the reimbursement of claims to be taxable under the Act or Section 105(h) of the Code, the
Company paid premiums shall be treated as taxable payments and be subject to imputed income tax treatment to the extent necessary
to eliminate any discriminatory treatment or taxation under the Act or Section 105(h) of the Code.

 

(d) Change
of Control: Termination by the Company without Cause, by the Executive with Good Reason. If the Executive’s employment
is terminated by the Company in breach of Section 4(d), or the Executive terminates his employment for Good Reason as provided
in Section 4(f), and such termination occurs (x) at the same time as, or within the 12 month period following, the consummation
of a Change in Control or (y) within the 60 day period prior to the date of a Change in Control where the Change in
Control was under consideration at the time of Executive’s Termination Date, then the Executive shall be entitled to the
following:

 

(i) the
Accrued Obligations earned through the Termination Date (payable on or before the time required by law but in no event more than
30 days after the applicable Termination);

 

(ii) severance
in a single lump sum installment in amount equal to 2x the sum of (A) the Base Salary at the rate in effect on the Termination
Date, plus (B) an amount equal to 2x the maximum Annual Bonus for which the Executive is eligible in the fiscal year in which
the Termination Date occurs, or, if, there is no Annual Bonus for which he is eligible in the fiscal year of the Termination Date,
2x the Annual Bonus most recently issued to the Executive. If either the Base Salary or Annual Bonus has been reduced either 60
days prior to a Change in Control or within 12 months following a Change in Control then severance shall be based upon the previously
highest Base Salary and the highest Annual Bonus previously awarded to the Executive. The severance is payable no later than 30
days following the Termination Date;

 

(iii) a
pro-rata portion of the Executive’s Annual Bonus, if any, for the fiscal year in which the Executive’s termination
occurs (determined by multiplying the amount of such bonus which would be due for the full fiscal year by a fraction, the numerator
of which is the number of days during the fiscal year of termination that the Executive is employed by the Company and the denominator
of which is 365) payable at the same time bonuses for such year are paid to other senior executives of the Company. If there is
no Annual Bonus for which he is eligible in the fiscal year of the Termination Date, then the award shall be based upon a pro
rata share of the Annual Bonus most recently issued to the Executive. If the Annual Bonus has been reduced either 60 days prior
to a Change in Control or within 12 months following a Change in Control then such pro-rata bonus shall be based upon the highest
Annual Bonus previously awarded to the Executive;

 

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(iv) full
vesting of the Executive in any and all outstanding previously granted equity-based incentive awards subject to time-based vesting
criteria;

 

(v) subject
to the Executive’s timely election of continuation coverage under COBRA, reimbursement by the Company of the monthly premium
payable to continue the Executive’s and his eligible dependents’ participation in the Company’s group health
plan (to the extent permitted under applicable law and the terms of such plan) which covers the Executive (and the Executive’s
eligible dependents) for a period of 18 months, provided that the Executive is eligible and remains eligible for COBRA
coverage; and provided, further, that in the event that the Executive obtains other employment that offers group
health benefits, such continuation of coverage by the Company shall immediately cease.  If the reimbursement of any COBRA
premiums would violate the nondiscrimination rules or cause the reimbursement of claims to be taxable under the Act or Section
105(h) of the Code, the Company paid premiums shall be treated as taxable payments and be subject to imputed income tax treatment
to the extent necessary to eliminate any discriminatory treatment or taxation under the Act or Section 105(h) of the Code.

 

(e) Change
of Control: For purposes of Section 5(d), a change of control shall have occurred upon any of the following:

 

(i) any
person or entity or group becoming the beneficial owner, directly or indirectly, of securities of the Company representing more
than 50% of the total voting power of all its then outstanding voting securities; 

 

(ii) a
merger or consolidation of the Company in which its voting securities immediately prior to the merger or consolidation do not
represent, or are not converted into securities that represent, a majority of the voting power of all voting securities of the
surviving entity immediately after the merger or consolidation; 

 

(iii) a
sale of substantially all of the assets of the Company or a liquidation or dissolution of the Company; or 

 

(iv) individuals
who, as of the date of the signing of this Agreement, constitute the Board of Directors (the “Incumbent Board”) cease
for any reason to constitute at least a majority of such Board; provided that any individual who becomes a director of the Company
subsequent to the date of the signing of this Agreement, whose election, or nomination for election by the Company stockholders,
was approved by the vote of at least a majority of the directors then in office shall be deemed a member of the Incumbent Board.

 

(f) 
Consequence of a Change in Control. Notwithstanding the terms of any employee compensation plan, if, as of the date of
a Change in Control, Executive holds equity awards issued under such a plan that are not vested and, if applicable, exercisable,
such equity awards shall become fully vested and, if applicable, exercisable, as of the date of the Change in Control if the acquirer
does not agree to assume or substitute for equivalent equity awards such outstanding unvested equity awards. 

 

(g) No
Mitigation or Offset. In the event of any termination of Executive’s employment hereunder, Executive shall be under
no obligation to seek other employment or otherwise mitigate the obligations of the Company under this Agreement, and there shall
be no offset against any amounts due under this Agreement on account of any remuneration attributable to any subsequent employment
that Executive may obtain.

 

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(h) Effect
of Termination on Officer and Board Positions. Any termination of the Executive with respect to the Executive’s standing
as an executive officer or Board Member must expressly designate which such role is subject to termination. The termination of
the Executive as an Officer will not thereby terminate the Executive’s Board status unless the termination so states, in
which event the Executive shall resign his Board position as a condition to receiving any of the payments set forth in this Section
5.

 

6. Section
409A Compliance.

 

(a) All
in-kind benefits provided and expenses eligible for reimbursement under this Agreement shall be provided by the Company or incurred
by the Executive during the time periods set forth in this Agreement. All reimbursements shall be paid as soon as administratively
practicable, but in no event shall any reimbursement be paid after the last day of the taxable year following the taxable year
in which the expense was incurred. The amount of in-kind benefits provided or reimbursable expenses incurred in one taxable year
shall not affect the in-kind benefits to be provided or the expenses eligible for reimbursement in any other taxable year. Such
right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.

 

(b) To
the extent that any of the payments or benefits provided for in Section 5(b), (c) or (d) are deemed to constitute non-qualified
deferred compensation benefits subject to Section 409A of the United States Internal Revenue Code (the “Code”),
the following interpretations apply to Section 5: 

 

(i) Any
termination of the Executive’s employment triggering payment of benefits under Section 5(b), (c) or (d) must constitute
a “separation from service” under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h) before distribution
of such benefits can commence. To the extent that the termination of the Executive’s employment does not constitute a separation
of service under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h) (as the result of further services that
are reasonably anticipated to be provided by the Executive to the Company or any of its parents, subsidiaries or affiliates at
the time the Executive’s employment terminates), any benefits payable under Section 5(b), (c) or (d) that constitute deferred
compensation under Section 409A of the Code shall be delayed until after the date of a subsequent event constituting a separation
of service under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h). For purposes of clarification, this Section
6(b)(i) shall not cause any forfeiture of benefits on the Executive’s part, but shall only act as a delay until such time
as a “separation from service” occurs.

 

(ii) If
the Executive is a “specified employee” (as that term is used in Section 409A of the Code and regulations and other
guidance issued thereunder) on the date his separation from service becomes effective, any benefits payable under Section 5(b),
(c) or (d) that constitute non-qualified deferred compensation under Section 409A of the Code shall be delayed until the earlier
of (A) the business day following the six-month anniversary of the date his separation from service becomes effective, and (B)
the date of the Executive’s death, but only to the extent necessary to avoid such penalties under Section 409A of the Code.
On the earlier of (A) the business day following the six-month anniversary of the date his separation from service becomes effective,
and (B) the Executive’s death, the Company shall pay the Executive in a lump sum the aggregate value of the non-qualified
deferred compensation that the Company otherwise would have paid the Executive prior to that date under Section 5(b), (c) or (d)
of this Agreement.

 

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(iii) It
is intended that each installment of the payments and benefits provided under Section 5(b), (c) or (d) of this Agreement shall
be treated as a separate “payment” for purposes of Section 409A of the Code. 

 

(iv) Neither
the Company nor the Executive shall have the right to accelerate or defer the delivery of any such payments or benefits except
to the extent specifically permitted or required by Section 409A of the Code.

 

7. Excess
Parachute Payments.

 

(a) To
the extent that any payment, benefit or distribution of any type to or for the benefit of the Executive by the Company or any
of its affiliates, whether paid or payable, provided or to be provided, or distributed or distributable pursuant to the terms
of this Agreement or otherwise (including, without limitation, any accelerated vesting of stock options or other equity-based
awards) (collectively, the “Total Payments”) would be subject to the excise tax imposed under Section 4999
of the Internal Revenue Code of 1986, as amended (the “Code”), then the Total Payments shall be reduced (but
not below zero) so that the maximum amount of the Total Payments (after reduction) shall be one dollar ($1.00) less than the amount
which would cause the Total Payments to be subject to the excise tax imposed by Section 4999 of the Code, but only if the Total
Payments so reduced result in the Executive receiving a net after tax amount that exceeds the net after tax amount the Executive
would receive if the Total Payments were not reduced and were instead subject to the excise tax imposed on excess parachute payments
by Section 4999 of the Code. Unless the Executive shall have given prior written notice to the Company to effectuate a reduction
in the Total Payments if such a reduction is required, any such notice consistent with the requirements of Section 409A of the
Code to avoid the imputation of any tax, penalty or interest thereunder, the Company shall reduce or eliminate the Total Payments
by first reducing or eliminating any cash severance benefits (with the payments to be made furthest in the future being reduced
first), then by reducing or eliminating any accelerated vesting of stock options or similar awards, then by reducing or eliminating
any accelerated vesting of restricted stock or similar awards, then by reducing or eliminating any other remaining Total Payments.
The preceding provisions of this Section 7(a) shall take precedence over the provisions of any other plan, arrangement or agreement
governing the Executive’s rights and entitlements to any benefits or compensation.

 

(b) If
the Total Payments to the Executive are reduced in accordance with Section 7(a), as a result of the uncertainty in the application
of Section 4999 of the Code at the time of the initial reduction under Section 7(a), it is possible that Total Payments to the
Executive which will not have been made by the Company should have been made (“Underpayment”) or that Total
Payments to the Executive which were made should not have been made (“Overpayment”). If an Underpayment has
occurred, the amount of any such Underpayment shall be promptly paid by the Company to or for the benefit of the Executive. In
the event of an Overpayment, then the Executive shall promptly repay to the Company the amount of any such Overpayment together
with interest on such amount (at the same rate as is applied to determine the present value of payments under Section 280G of
the Code or any successor thereto), from the date the reimbursable payment was received by the Executive to the date the same
is repaid to the Company

 

    10

     

    

 

8. Confidentiality
and Restrictive Covenants. 

 

(a) Covenant
Against Disclosure. All Confidential Information (defined below) relating to the Business of the Company and its affiliates
is, shall be and shall remain the sole property and confidential business information of them, free of any rights of the Executive.
The Executive shall not make any use of the Confidential Information except in the performance of his duties hereunder and shall
not disclose any Confidential Information or trade secret to third parties except as required by law, with the limited qualification
that in accordance with the Defend Trade Secrets Act of 2016, an individual shall not be held criminally or civilly liable under
any Federal or State trade secret law for the disclosure of a trade secret that is made either: (1) in confidence to a Federal,
State, or local government official, either directly or indirectly, or to an attorney, solely for the purpose of reporting or
investigating a suspected violation of law; or (2) in a complaint or other document filed in a lawsuit or other proceeding, if
such filing is made under seal, “Confidential Information” includes without limitation such documents as business
plans, source code, documentation, financial analysis, marketing plans, customer names, customer lists, customer data, contracts
and other business information, including the information of the Company and its affiliates, existing or prospective customers,
clients, investors or other third parties with whom the Company and its affiliates hereto have relationships or conduct business
that may be disclosed to the Executive as part of the Executive’s employment. Notwithstanding anything else set forth herein,
nothing in this Agreement shall be construed to prohibit Executive from reporting, without first notifying the Company or otherwise,
possible violations of law or regulation to any governmental agency or entity.

 

(b) Return
of Company Documents. On the Termination Date or on any prior date upon the Company’s written demand, the Executive
will return all Confidential Information in his possession, directly or indirectly, that is in written or other tangible form
(together with all duplicates thereof).

 

(c) Further
Covenant. During the Term and through the first anniversary of the Termination Date, the Executive shall not, directly or
indirectly, take any of the following actions, and, to the extent the Executive owns, manages, operates, controls, is employed
by or participates in the ownership, management, operation or control of, or is connected in any manner with, any business, the
Executive will use his best efforts to ensure that such business does not take any of the following actions:

 

(i) persuade
or attempt to persuade any customer of the Company or its affiliates to cease doing business with the Company or its affiliates,
or to reduce the amount of business any customer does with the Company or its affiliates;

 

(ii) solicit
for himself or any entity the business of a person or entity that was a customer of the Company or its affiliates within the 12
months prior to the termination of the Executive’s employment, in competition with the Company or its affiliates; or

 

(iii) persuade
or attempt to persuade any employee of the Company or its affiliates to leave the employ of the Company or its affiliates, or
hire or engage, directly or indirectly, any individual who was an employee of the Company or its affiliates within 1 year prior
to the Executive’s Termination Date.

 

9. D&O
Insurance.  At the request of the Executive, the Company obtain and continue for as long as Executive is employed by
the Company, directors’ and officers’ insurance coverage at levels no less than $5,000,000 with an insurance company
rated “A” or higher.

 

10. Waiver.
Except with respect to opportunities in which the Company would be interested in the ordinary course of its business and which
are presented to the Executive in his capacity as a director or executive officer of the Company, the  Board has renounced
on behalf of the Company and its shareholders all interest and expectancy to (or being offered any opportunity to participate
in) any opportunity presented to the Executive that may be considered a corporate opportunity of the Company, and the Executive
shall have no obligation to communicate, offer, or present any opportunity presented to the Executive that may be considered a
corporate opportunity of the Company, whether centered on geography, land rights, or otherwise (the “Renouncement”). 
The Company acknowledges that the Renouncement is a material term of this Agreement and the Executive is specifically relying
on the Renouncement in agreeing to enter into this Agreement.  Except with respect to opportunities in which the Company
would be interested in the ordinary course of its business and which are presented to the Executive in his capacity as a director
or executive officer of the Company, to the fullest extent permitted by law, the Company hereby prospectively waives any and all
claims arising from any business transacted by the Executive that could be construed as a corporate opportunity of the Company. 
A copy of the Board resolution is attached hereto as Exhibit B.

 

    11

     

    

 

11. No
Disparagement. During the Term and through the second anniversary of the Termination Date, the Executive will not make public
statements or communications that disparage the Company or any of its businesses, services, products, affiliates or current, former
or future directors and executive officers in their capacity as such. During the Term and through the second anniversary of the
Termination Date, the Company will instruct its directors and executives not to make public statements or communications that
disparage the Executive. The foregoing obligations shall not be violated by truthful statements to any governmental agency or
entity, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation,
depositions in connection with such proceedings).

 

12. Indemnification.
During the Term and thereafter, the Company shall indemnify and hold the Executive and the Executive’s heirs and representatives
harmless, to the maximum extent permitted by law, against any and all damages, costs, liabilities, losses and expenses (including
reasonable attorneys’ fees) as a result of any claim or proceeding (whether civil, criminal, administrative or investigative),
or any threatened claim or proceeding (whether civil, criminal, administrative or investigative), against the Executive that arises
out of or relates to the Executive’s service as an officer, director or employee, as the case may be, of the Company, or
the Executive’s service in any such capacity or similar capacity with any affiliate of the Company or other entity at the
Company’s request, both prior to and after the Effective Date, and to promptly advance to the Executive or the Executive’s
heirs or representatives such expenses, including litigation costs and attorneys’ fees, upon written request with appropriate
documentation of such expense upon receipt of an undertaking by the Executive or on the Executive’s behalf to repay such
amount if it shall ultimately be determined that the Executive is not entitled to be indemnified by the Company. During the Term
and thereafter, the Company also shall provide the Executive with coverage under its then current directors’ and officers’
liability policy to the same extent that it provides such coverage to its other executive officers. If the Executive has any knowledge
of any actual or threatened action, suit or proceeding, whether civil, criminal, administrative or investigative, as to which
the Executive may request indemnity under this provision, the Executive will give the Company prompt written notice thereof; provided
that the failure to give such notice shall not affect the Executive’s right to indemnification. The Company shall be entitled
to assume the defense of any such proceeding and the Executive will use reasonable efforts to cooperate with such defense. To
the extent that the Executive in good faith determines that there is an actual or potential conflict of interest between the Company
and the Executive in connection with the defense of a proceeding, the Executive shall so notify the Company and shall be entitled
to separate representation at the Company’s expense by counsel selected by the Executive (provided that the Company may
reasonably object to the selection of counsel within 10 business days after notification thereof) which counsel shall cooperate,
and coordinate the defense, with the Company’s counsel and minimize the expense of such separate representation to the extent
consistent with the Executive’s separate defense. This Section 12 shall continue in effect after the termination of the
Executive’s employment or the termination of this Agreement

 

13. Disputes.

 

(a) Any
dispute or controversy arising out of or relating to this Agreement or your employment shall be brought solely in the state and
federal courts located in the State and County of New York.

 

    12

     

    

 

(b) BOTH
THE COMPANY AND THE EXECUTIVE HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE FEDERAL
OR STATE LAW.

 

(c) In
the event of any contest or dispute relating to this Agreement or the termination of Executive’s employment hereunder, the
non-prevailing party in any such contest or dispute shall be liable for the attorneys’ fees and costs of the prevailing
party.

 

14. Integration.
This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all
prior agreements between the parties concerning such subject matter.

 

15. Successors.
This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal representatives, executors,
administrators, heirs, distributees, devisees and legatees. In the event of the Executive’s death after his termination
of employment but prior to the completion by the Company of all payments due him under this Agreement, the Company shall continue
such payments to the Executive’s beneficiary designated in writing to the Company prior to his death (or to his estate,
if the Executive fails to make such designation). The Company shall require any successor to the Company to expressly assume and
agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if
no such succession had taken place.

 

16. Enforceability.
If any portion or provision of this Agreement (including, without limitation, any portion or provision of any section of this
Agreement) shall to any extent be declared illegal or unenforceable by a court of competent jurisdiction, then the remainder of
this Agreement, or the application of such portion or provision in circumstances other than those as to which it is so declared
illegal or unenforceable, shall not be affected thereby, and each portion and provision of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.

 

17. Survival.
The provisions of this Agreement shall survive the termination of this Agreement or the termination of the Executive’s employment
to the extent necessary to effectuate the terms contained herein.

 

18. Waiver.
No waiver of any provision hereof shall be effective unless made in writing and signed by the waiving party. The failure of any
party to require the performance of any term or obligation of this Agreement, or the waiver by any party of any breach of this
Agreement, shall not prevent any subsequent enforcement of such term or obligation or be deemed a waiver of any subsequent breach.

 

19. Notices.
Any notices, requests, demands and other communications provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by a nationally recognized overnight courier service or by registered or certified mail, postage prepaid, return
receipt requested, to the Executive at the last address the Executive has filed in writing with the Company or, in the case of
the Company, at its main offices,

 

	 	If to Executive:	Theodore Farnsworth

444
Brickell Avenue 

Miami
Florida 33131

 

	 	If to Company:	Helios and Matheson Analytics Inc.

350
5th Ave - Ste 7520 

New
York, NY 10118 

Attention:
CFO

 

    13

     

    

 

20. Amendment.
This Agreement may be amended or modified only by a written instrument signed by the Executive and by a duly authorized representative
of the Company.

 

21. Governing
Law. This is a New York contract and shall be construed under and be governed in all respects by the laws of New York for
contracts to be performed in that State and without giving effect to the conflict of laws principles of New York or any other
State.

 

22. Counterparts.
This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same document.

 

[REMAINDER
OF THIS PAGE LEFT INTENTIONALLY BLANK]

 

    14

     

    

 

IN
WITNESS WHEREOF, the parties have executed this Agreement effective on the date and year first above written.

 

	 	HELIOS
    AND MATHESON ANALYTICS INC.
	 	 	 
	 	By:	/s/
    Stuart Benson
	 	Name:	Stuart
    Benson
	 	Title:	Chief
    Financial Officer
	 	 	 
	 	THEODORE
    FARNSWORTH 
	 	 
	 	/s/
    Theodore Farnsworth

 

    15

     

    

 

Exhibit
A

 

Initial
Award 

 

As of the Effective Date,
the Company shall grant to the Executive 2,000,000 shares of common stock (subject to proportionate adjustment for any stock split
or combination or other recapitalization event), subject to the terms of the applicable Award Agreement. The shares shall vest
in their entirety on February 15, 2019, which is 18 months following August 15, 2017, the date on which the Company entered into
a Securities Purchase Agreement to acquire a majority stake in MoviePass Inc. (the “MoviePass SPA”), which requires
that the Company enter into a 5-year employment agreement with the Executive prior to the closing under the MoviePass SPA. 

 

Treatment
resulting from termination of employment 

 

	Death or Disability	 	All unvested award shares immediately vest on the applicable Termination Date.
	 	 	 
	Voluntary quit	 	All unvested award shares that did not yet vest will be cancelled on the last day of employment.
	 	 	 
	Termination for Cause	 	All unvested award shares that did not yet vest will be cancelled on the last day of employment.
	 	 	 
	Termination without Cause/ Quit for Good Reason	 	All unvested award shares immediately vest on the applicable Termination Date.

 

The
terms of any award under this Exhibit A shall be more fully set forth in an Award Agreement. It is expressly acknowledged and
agreed that this Exhibit A is a summary of the contemplated terms of the applicable Award Agreement, which shall be subject to
the Company’s receipt of all corporate approvals required by applicable law or the rules and regulations of the Principal
Market prior to effectiveness thereof. To the extent that there is any conflict between the terms of this Exhibit A and the applicable
Award Agreement, the terms of the Award Agreement shall govern.

 

    16

     

    

 

Exhibit
B

 

(Board
Resolutions for Prospective Waiver of Corporate Opportunities)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    17

     

    

 

SCHEDULE
1

 

Market
Capitalization Milestones

 

If
the Company’s common stock is publicly traded during the Term and the market capitalization of the Company is for 20 consecutive
trading days during the Term at or above the following milestones, the Executive shall receive, within five business days following
such 20th consecutive trading day, an award of shares of Company common stock (a) which shall vest upon the later of February
15, 2019 and the end of the applicable three-month period following the applicable date of the grant, and (b) that, upon the date
of the grant, shall have an aggregate value equal the percentage of the market capitalization set forth next to the applicable
milestone* below based on the closing price of the common stock on the Principal Market on the date of the grant (the “Fair
Market Value”):

 

	Company 
Market Capitalization Milestone	 	Percentage
	$100,000,000	 	3%
	$150,000,000	 	3%
	$200,000,000	 	4%
	$250,000,000	 	4%
	$300,000,000	 	5%
	$350,000,000	 	5%
	$400,000,000	 	7%
	$450,000,000	 	7%
	$500,000,000	 	9%
	every additional $100,000,000 thereafter (cumulated with the applicable immediately preceding milestone)	 	10%

 

Each
milestone above is a separate milestone for which the Executive may earn the applicable percentage. The Executive will be entitled
to earn the applicable percentage for each milestone only once. The Company’s market capitalization for each applicable
milestone and measurement period will be determined based on the market capitalization reported by Bloomberg LP. 

 

*
For example:

 

If
the Company’s market capitalization is at least $250,000,000 as of market close for at least 20 consecutive trading days
and the Fair Market Value is $12.50 per share, Executive shall receive 800,000 fully vested shares of common stock of the Company
(800,000 *$12.50 = $10,000,000 which is 4% of $250,000,000).

 

The
terms of any award under this Schedule 1 shall be more fully set forth in an Award Agreement. It is expressly acknowledged and
agreed that this Schedule 1 is a summary of certain contemplated terms of the applicable Award Agreement, which shall be subject
to the Company’s receipt of all corporate approvals required by applicable law or the rules and regulations of the Principal
Market prior to effectiveness thereof. To the extent that there is any conflict between the terms of this Schedule 1 and the applicable
Award Agreement, the terms of the Award Agreement shall govern.

 

 

18Exhibit 4.3

	
 
    

 

LEXINFINTECH HOLDINGS LTD.

 

AND

 

THE BANK OF NEW YORK MELLON

 

As Depositary

 

AND

 

OWNERS AND HOLDERS OF AMERICAN DEPOSITARY SHARES

 

Deposit Agreement

 

                       , 2017

	
 
    

 

 

TABLE OF CONTENTS

 

	
ARTICLE 1.
    	
DEFINITIONS
    	
1
    
	
SECTION 1.1.
    	
American Depositary   Shares
    	
1
    
	
SECTION 1.2.
    	
Commission
    	
2
    
	
SECTION 1.3.
    	
Company
    	
2
    
	
SECTION 1.4.
    	
Custodian
    	
2
    
	
SECTION 1.5.
    	
Delisting Event
    	
2
    
	
SECTION 1.6.
    	
Deliver; Surrender
    	
2
    
	
SECTION 1.7.
    	
Deposit Agreement
    	
3
    
	
SECTION 1.8.
    	
Depositary;   Depositary’s Office
    	
3
    
	
SECTION 1.9.
    	
Deposited Securities
    	
3
    
	
SECTION 1.10.
    	
Disseminate
    	
3
    
	
SECTION 1.11.
    	
Dollars
    	
4
    
	
SECTION 1.12.
    	
DTC
    	
4
    
	
SECTION 1.13.
    	
Foreign Registrar
    	
4
    
	
SECTION 1.14.
    	
Holder
    	
4
    
	
SECTION 1.15.
    	
Insolvency Event
    	
4
    
	
SECTION 1.16.
    	
Owner
    	
4
    
	
SECTION 1.17.
    	
Receipts
    	
5
    
	
SECTION 1.18.
    	
Registrar
    	
5
    
	
SECTION 1.19.
    	
Replacement
    	
5
    
	
SECTION 1.20.
    	
Restricted Securities
    	
5
    
	
SECTION 1.21.
    	
Securities Act of 1933
    	
5
    
	
SECTION 1.22.
    	
Shares
    	
5
    
	
SECTION 1.23.
    	
SWIFT
    	
6
    
	
SECTION 1.24.
    	
Termination Option   Event
    	
6
    
	
 
    	
 
    	
 
    
	
ARTICLE 2.
    	
FORM OF RECEIPTS,   DEPOSIT OF SHARES, DELIVERY, TRANSFER AND SURRENDER OF AMERICAN DEPOSITARY   SHARES
    	
6
    
	
SECTION 2.1.
    	
Form of Receipts;   Registration and Transferability of American Depositary Shares
    	
6
    
	
SECTION 2.2.
    	
Deposit of Shares
    	
7
    
	
SECTION 2.3.
    	
Delivery of American   Depositary Shares
    	
8
    
	
SECTION 2.4.
    	
Registration of   Transfer of American Depositary Shares; Combination and Split-up of Receipts;   Interchange of Certificated and Uncertificated American Depositary Shares
    	
8
    
	
SECTION 2.5.
    	
Surrender of American   Depositary Shares and Withdrawal of Deposited Securities
    	
9
    
	
SECTION 2.6.
    	
Limitations on   Delivery, Transfer and Surrender of American Depositary Shares
    	
10
    
				

 

i

 

	
SECTION 2.7.
    	
Lost   Receipts, etc.
    	
11
    
	
SECTION 2.8.
    	
Cancellation and   Destruction of Surrendered Receipts
    	
11
    
	
SECTION 2.9.
    	
Pre-Release of American   Depositary Shares
    	
11
    
	
SECTION 2.10.
    	
DTC Direct Registration   System and Profile Modification System
    	
12
    
	
 
    	
 
    	
 
    
	
ARTICLE 3.
    	
CERTAIN OBLIGATIONS OF   OWNERS AND HOLDERS OF AMERICAN DEPOSITARY SHARES
    	
13
    
	
SECTION 3.1.
    	
Filing Proofs,   Certificates and Other Information
    	
13
    
	
SECTION 3.2.
    	
Liability of Owner for   Taxes
    	
13
    
	
SECTION 3.3.
    	
Warranties on Deposit   of Shares
    	
14
    
	
SECTION 3.4.
    	
Disclosure of Interests
    	
14
    
	
 
    	
 
    	
 
    
	
ARTICLE 4.
    	
THE DEPOSITED   SECURITIES
    	
14
    
	
SECTION 4.1.
    	
Cash Distributions
    	
14
    
	
SECTION 4.2.
    	
Distributions Other   Than Cash, Shares or Rights
    	
15
    
	
SECTION 4.3.
    	
Distributions in Shares
    	
16
    
	
SECTION 4.4.
    	
Rights
    	
16
    
	
SECTION 4.5.
    	
Conversion of Foreign   Currency
    	
18
    
	
SECTION 4.6.
    	
Fixing of Record Date
    	
19
    
	
SECTION 4.7.
    	
Voting of Deposited   Shares
    	
19
    
	
SECTION 4.8.
    	
Tender and Exchange   Offers; Redemption, Replacement or Cancellation of Deposited Securities
    	
21
    
	
SECTION 4.9.
    	
Reports
    	
22
    
	
SECTION 4.10.
    	
Lists of Owners
    	
23
    
	
SECTION 4.11.
    	
Withholding
    	
23
    
	
 
    	
 
    	
 
    
	
ARTICLE 5.
    	
THE DEPOSITARY, THE   CUSTODIANS AND THE COMPANY
    	
23
    
	
SECTION 5.1.
    	
Maintenance of Office   and Transfer Books by the Depositary
    	
23
    
	
SECTION 5.2.
    	
Prevention or Delay of   Performance by the Company or the Depositary
    	
24
    
	
SECTION 5.3.
    	
Obligations of the   Depositary and the Company
    	
25
    
	
SECTION 5.4.
    	
Resignation and Removal   of the Depositary
    	
26
    
	
SECTION 5.5.
    	
The Custodians
    	
27
    
	
SECTION 5.6.
    	
Notices and Reports
    	
27
    
	
SECTION 5.7.
    	
Distribution of   Additional Shares, Rights, etc.
    	
28
    
	
SECTION 5.8.
    	
Indemnification
    	
28
    
	
SECTION 5.9.
    	
Charges of Depositary
    	
29
    
	
SECTION 5.10.
    	
Retention of Depositary   Documents
    	
30
    
				

 

ii

 

	
SECTION 5.11.
    	
Exclusivity
    	
31
    
	
 
    	
 
    	
 
    
	
ARTICLE 6.
    	
AMENDMENT AND   TERMINATION
    	
31
    
	
SECTION 6.1.
    	
Amendment
    	
31
    
	
SECTION 6.2.
    	
Termination
    	
31
    
	
 
    	
 
    	
 
    
	
ARTICLE 7.
    	
MISCELLANEOUS
    	
32
    
	
SECTION 7.1.
    	
Counterparts;   Signatures
    	
32
    
	
SECTION 7.2.
    	
No Third Party   Beneficiaries
    	
33
    
	
SECTION 7.3.
    	
Severability
    	
33
    
	
SECTION 7.4.
    	
Owners and Holders as   Parties; Binding Effect
    	
33
    
	
SECTION 7.5.
    	
Notices
    	
33
    
	
SECTION 7.6.
    	
Arbitration; Settlement   of Disputes
    	
34
    
	
SECTION 7.7.
    	
Appointment of Agent   for Service of Process; Submission to Jurisdiction; Jury Trial Waiver
    	
35
    
	
SECTION 7.8.
    	
Waiver of Immunities
    	
36
    
	
SECTION 7.9.
    	
Governing Law
    	
36
    
				

 

iii

 

DEPOSIT AGREEMENT

 

DEPOSIT AGREEMENT dated as of            , 2017 among LEXINFINTECH HOLDINGS LTD., a company incorporated under the laws of the Cayman Islands (herein called the Company), THE BANK OF NEW YORK MELLON, a New York banking corporation (herein called the Depositary), and all Owners and Holders (each as hereinafter defined) from time to time of American Depositary Shares issued hereunder.

 

W I T N E S S E T H:

 

WHEREAS, the Company desires to provide, as set forth in this Deposit Agreement, for the deposit of Shares (as hereinafter defined) of the Company from time to time with the Depositary or with the Custodian (as hereinafter defined) under this Deposit Agreement, for the creation of American Depositary Shares representing the Shares so deposited and for the execution and delivery of American Depositary Receipts evidencing the American Depositary Shares; and

 

WHEREAS, the American Depositary Receipts are to be substantially in the form of Exhibit A annexed to this Deposit Agreement, with appropriate insertions, modifications and omissions, as set forth in this Deposit Agreement;

 

NOW, THEREFORE, in consideration of the premises, it is agreed by and between the parties hereto as follows:

 

ARTICLE 1.                                                   DEFINITIONS

 

The following definitions shall for all purposes, unless otherwise clearly indicated, apply to the respective terms used in this Deposit Agreement:

 

SECTION 1.1.                                          American Depositary Shares.

 

The term “American Depositary Shares” shall mean the securities created under this Deposit Agreement representing rights with respect to the Deposited Securities.  American Depositary Shares may be certificated securities evidenced by Receipts or uncertificated securities.  The form of Receipt annexed as Exhibit A to this Deposit Agreement shall be the prospectus required under the Securities Act of 1933 for sales of both certificated and uncertificated American Depositary Shares.  Except for those provisions of this Deposit Agreement that refer specifically to Receipts, all the provisions of this Deposit Agreement shall apply to both certificated and uncertificated American Depositary Shares.

 

Each American Depositary Share shall represent the number of Shares specified in Exhibit A to this Deposit Agreement, except that, if there is a distribution upon Deposited Securities covered by Section 4.3, a change in Deposited Securities covered by Section 4.8 with respect to which additional American Depositary Shares are not delivered or a sale of Deposited Securities under Section 3.2 or 4.8, each American Depositary Share shall thereafter represent the amount of Shares or other Deposited Securities that are then on deposit per American Depositary Share after giving effect to that distribution, change or sale.

 

1

 

SECTION 1.2.                                          Commission.

 

The term “Commission” shall mean the Securities and Exchange Commission of the United States or any successor governmental agency in the United States.

 

SECTION 1.3.                                          Company.

 

The term “Company” shall mean LexinFintech Holdings Ltd., a company incorporated under the laws of the Cayman Islands, and its successors.

 

SECTION 1.4.                                          Custodian.

 

The term “Custodian” shall mean The Hongkong and Shanghai Banking Corporation Limited , as custodian for the Depositary in Hong Kong for the purposes of this Deposit Agreement, and any other firm or corporation the Depositary appoints under Section 5.5 as a substitute or additional custodian under this Deposit Agreement, and shall also mean all of them collectively.

 

SECTION 1.5.                                          Delisting Event.

 

A “Delisting Event” occurs if the American Depositary Shares are delisted from a securities exchange on which the American Depositary Shares were listed and the Company has not listed or applied to list the American Depositary Shares on any other securities exchange.

 

SECTION 1.6.                                          Deliver; Surrender.

 

(a)                                 The term “deliver”, or its noun form, when used with respect to Shares or other Deposited Securities, shall mean (i) book-entry transfer of those Shares or other Deposited Securities to an account maintained by an institution authorized under applicable law to effect transfers of such securities designated by the person entitled to that delivery or (ii) physical transfer of certificates evidencing those Shares or other Deposited Securities registered in the name of, or duly endorsed or accompanied by proper instruments of transfer to, the person entitled to that delivery.

 

(b)                                 The term “deliver”, or its noun form, when used with respect to American Depositary Shares, shall mean (i) registration of those American Depositary Shares in the name of DTC or its nominee and book-entry transfer of those American Depositary Shares to an account at DTC designated by the person entitled to that delivery, (ii) registration of those American Depositary Shares not evidenced by a Receipt on the books of the Depositary in the name requested by the person entitled to that delivery and mailing to that person of a statement confirming that registration or (iii) if requested by the person entitled to that delivery, execution and delivery at the Depositary’s Office to the person entitled to that delivery of one or more Receipts evidencing those American Depositary Shares registered in the name requested by that person.

 

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(c)                                  The term “surrender”, when used with respect to American Depositary Shares, shall mean (i) one or more book-entry transfers of American Depositary Shares to the DTC account of the Depositary, (ii) delivery to the Depositary at its Office of an instruction to surrender American Depositary Shares not evidenced by a Receipt or (iii) surrender to the Depositary at its Office of one or more Receipts evidencing American Depositary Shares.

 

SECTION 1.7.                                          Deposit Agreement.

 

The term “Deposit Agreement” shall mean this Deposit Agreement, as it may be amended from time to time in accordance with its provisions.

 

SECTION 1.8.                                          Depositary; Depositary’s Office.

 

The term “Depositary” shall mean The Bank of New York Mellon, a New York banking corporation, and any successor as depositary under this Deposit Agreement.  The term “Office”, when used with respect to the Depositary, shall mean the office at which its depositary receipts business is administered, which, at the date of this Deposit Agreement, is located at 101 Barclay Street, New York, New York 10286.

 

SECTION 1.9.                                          Deposited Securities.

 

The term “Deposited Securities” as of any time shall mean Shares at such time deposited or deemed to be deposited under this Deposit Agreement, including without limitation, Shares that have not been successfully delivered upon surrender of American Depositary Shares, and any and all other securities, property and cash received by the Depositary or the Custodian in respect of Deposited Securities and at that time held under this Deposit Agreement.

 

SECTION 1.10.                                   Disseminate.

 

The term “Disseminate,” when referring to a notice or other information to be sent by the Depositary to Owners, shall mean (i) sending that information to Owners in paper form by mail or another means or (ii) with the consent of Owners, another procedure that has the effect of making the information available to Owners, which may include (A) sending the information by electronic mail or electronic messaging or (B) sending in paper form or by electronic mail or messaging a statement that the information is available and may be accessed by the Owner on an Internet website and that it will be sent in paper form upon request by the Owner, when that information is so available and is sent in paper form as promptly as practicable upon request.

 

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SECTION 1.11.                                   Dollars.

 

The term “Dollars” shall mean United States dollars.

 

SECTION 1.12.                                   DTC.

 

The term “DTC” shall mean The Depository Trust Company or its successor.

 

SECTION 1.13.                                   Foreign Registrar.

 

The term “Foreign Registrar” shall mean the entity that carries out the duties of registrar for the Shares and any other agent of the Company for the transfer and registration of Shares, including, without limitation, any securities depository for the Shares.

 

SECTION 1.14.                                   Holder.

 

The term “Holder” shall mean any person holding a Receipt or a security entitlement or other interest in American Depositary Shares, whether for its own account or for the account of another person, but that is not the Owner of that Receipt or those American Depositary Shares.

 

SECTION 1.15.                                   Insolvency Event.

 

An “Insolvency Event” occurs if the Company institutes proceedings to be adjudicated as bankrupt or insolvent, consents to the institution of bankruptcy or insolvency proceedings against it, files a petition or answer or consent seeking reorganization or relief under any applicable law in respect of bankruptcy or insolvency, consents to the filing of any petition of that kind or to the appointment of a receiver, liquidator, assignee, trustee, custodian or sequestrator (or other similar official) of it or any substantial part of its property or makes an assignment for the benefit of creditors, or if the Company admits its inability to pay its debts as they become due in the ordinary course of business.

 

SECTION 1.16.                                   Owner.

 

The term “Owner” shall mean the person in whose name American Depositary Shares are registered on the books of the Depositary maintained for that purpose.

 

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SECTION 1.17.                                   Receipts.

 

The term “Receipts” shall mean the American Depositary Receipts issued under this Deposit Agreement evidencing certificated American Depositary Shares, as the same may be amended from time to time in accordance with the provisions of this Deposit Agreement.

 

SECTION 1.18.                                   Registrar.

 

The term “Registrar” shall mean any corporation or other entity that is appointed by the Depositary to register American Depositary Shares and transfers of American Depositary Shares as provided in this Deposit Agreement.

 

SECTION 1.19.                                   Replacement.

 

The term “Replacement” shall have the meaning assigned to it in Section 4.8.

 

SECTION 1.20.                                   Restricted Securities.

 

The term “Restricted Securities” shall mean Shares that (i) are “restricted securities,” as defined in Rule 144 under the Securities Act of 1933, except for Shares that could be resold in reliance on Rule 144 without any conditions, (ii) are beneficially owned by an officer, director (or person performing similar functions) or other affiliate of the Company, (iii) otherwise would require registration under the Securities Act of 1933 in connection with the public offer and sale thereof in the United States or (iv) are subject to other restrictions on sale or deposit under the laws of the Cayman Islands, a shareholder agreement or the articles of association or similar document of the Company.

 

SECTION 1.21.                                   Securities Act of 1933.

 

The term “Securities Act of 1933” shall mean the United States Securities Act of 1933, as from time to time amended.

 

SECTION 1.22.                                   Shares.

 

The term “Shares” shall mean Class A ordinary shares of the Company that are validly issued and outstanding, fully paid and nonassessable and that were not issued in violation of any pre-emptive or similar rights of the holders of outstanding securities of the Company; provided, however, that, if there shall occur any change in nominal or par value, a split-up or consolidation or any other reclassification or, upon the occurrence of an event described in Section 4.8, an exchange or conversion in respect of the Shares of the Company, the term “Shares” shall thereafter also mean the successor securities resulting from such change in nominal or par value, split-up or consolidation or such other reclassification or such exchange or conversion.

 

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SECTION 1.23.                                   SWIFT.

 

The term “SWIFT” shall mean the financial messaging network operated by the Society for Worldwide Interbank Financial Telecommunication, or its successor.

 

SECTION 1.24.                                   Termination Option Event.

 

The term “Termination Option Event” shall mean an event of a kind defined as such in Section 4.1, 4.2 or 4.8.

 

ARTICLE 2.                               FORM OF RECEIPTS, DEPOSIT OF SHARES, DELIVERY, TRANSFER AND SURRENDER OF AMERICAN DEPOSITARY SHARES

 

SECTION 2.1.                                          Form of Receipts; Registration and Transferability of American Depositary Shares.

 

Definitive Receipts shall be substantially in the form set forth in Exhibit A to this Deposit Agreement, with appropriate insertions, modifications and omissions, as permitted under this Deposit Agreement.  No Receipt shall be entitled to any benefits under this Deposit Agreement or be valid or obligatory for any purpose, unless that Receipt has been (i) executed by the Depositary by the manual signature of a duly authorized officer of the Depositary or (ii) executed by the facsimile signature of a duly authorized officer of the Depositary and countersigned by the manual signature of a duly authorized signatory of the Depositary or the Registrar or a co-registrar.  The Depositary shall maintain books on which (x) each Receipt so executed and delivered as provided in this Deposit Agreement and each transfer of that Receipt and (y) all American Depositary Shares delivered as provided in this Deposit Agreement and all registrations of transfer of American Depositary Shares, shall be registered.  A Receipt bearing the facsimile signature of a person that was at any time a proper officer of the Depositary shall, subject to the other provisions of this paragraph, bind the Depositary, even if that person was not a proper officer of the Depositary on the date of issuance of that Receipt.

 

The Receipts and statements confirming registration of American Depositary Shares may have incorporated in or attached to them such legends or recitals or modifications not inconsistent with the provisions of this Deposit Agreement as may be required by the Depositary or required to comply with any applicable law or regulations thereunder or with the rules and regulations of any securities exchange upon which American Depositary Shares may be listed or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Receipts and American Depositary Shares are subject by reason of the date of issuance of the underlying Deposited Securities or otherwise.

 

American Depositary Shares evidenced by a Receipt, when the Receipt is properly endorsed or accompanied by proper instruments of transfer, shall be transferable as certificated registered securities under the laws of the State of New York.  American Depositary Shares not evidenced by Receipts shall be transferable as uncertificated registered securities under the laws of the State of New York.  The Depositary, notwithstanding any notice to the contrary, may treat the Owner of American Depositary Shares as the absolute owner thereof for the purpose of determining the person entitled to distribution of dividends or other distributions or to any notice provided for in this Deposit Agreement and for all other purposes, and neither the Depositary nor the Company shall have any obligation or be subject to any liability under this Deposit Agreement to any Holder of American Depositary Shares (but only to the Owner of those American Depositary Shares).

 

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SECTION 2.2.                                          Deposit of Shares.

 

Subject to the terms and conditions of this Deposit Agreement, Shares or evidence of rights to receive Shares may be deposited under this Deposit Agreement by delivery thereof to any Custodian, accompanied by any appropriate instruments or instructions for transfer, or endorsement, in form satisfactory to the Custodian.

 

As conditions of accepting Shares for deposit, the Depositary may require (i) any certification required by the Depositary or the Custodian in accordance with the provisions of this Deposit Agreement, (ii) a written order directing the Depositary to deliver to, or upon the written order of, the person or persons stated in that order American Depositary Shares representing those deposited Shares, (iii) evidence satisfactory to the Depositary that those Shares have been re-registered in the books of the Company or the Foreign Registrar in the name of the Depositary, a Custodian or a nominee of the Depositary or a Custodian, (iv) evidence satisfactory to the Depositary that any necessary approval for the transfer or deposit has been granted by any governmental body in each applicable jurisdiction and (v) an agreement or assignment, or other instrument satisfactory to the Depositary, that provides for the prompt transfer to the Custodian of any dividend, or right to subscribe for additional Shares or to receive other property, that any person in whose name those Shares are or have been recorded may thereafter receive upon or in respect of those Shares, or, in lieu thereof, such agreement of indemnity or other agreement as shall be satisfactory to the Depositary.

 

At the request and risk and expense of a person proposing to deposit Shares, and for the account of that person, the Depositary may receive certificates for Shares to be deposited, together with the other instruments specified in this Section, for the purpose of forwarding those Share certificates to the Custodian for deposit under this Deposit Agreement.

 

The Depositary shall refuse, and shall instruct the Custodian to refuse, to accept Shares for deposit if the Depositary has received a notice from the Company that the Company has restricted transfer of those Shares under the Company’s articles of association or any applicable laws or that the deposit would result in any violation of the Company’s articles of association or any applicable laws. The Company shall notify the Depositary in writing with respect to any restrictions on transfer of its Shares for deposit under this Deposit Agreement.

 

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The Depositary shall instruct each Custodian that, upon each delivery to a Custodian of a certificate or certificates for Shares to be deposited under this Deposit Agreement, together with the other documents specified in this Section, that Custodian shall, as soon as transfer and recordation can be accomplished, present that certificate or those certificates to the Company or the Foreign Registrar, if applicable, for transfer and recordation of the Shares being deposited in the name of the Depositary or its nominee or that Custodian or its nominee.

 

Deposited Securities shall be held by the Depositary or by a Custodian for the account and to the order of the Depositary or at such other place or places as the Depositary shall determine.

 

SECTION 2.3.                                          Delivery of American Depositary Shares.

 

The Depositary shall instruct each Custodian that, upon receipt by that Custodian of any deposit pursuant to Section 2.2, together with the other documents  or evidence required under that Section, that Custodian shall notify the Depositary of that deposit and the person or persons to whom or upon whose written order American Depositary Shares are deliverable in respect thereof.  Upon receiving a notice of a deposit from a Custodian, or upon the receipt of Shares or evidence of the right to receive Shares by the Depositary, the Depositary, subject to the terms and conditions of this Deposit Agreement, shall deliver, to or upon the order of the person or persons entitled thereto, the number of American Depositary Shares issuable in respect of that deposit, but only upon payment to the Depositary of the fees and expenses of the Depositary for the delivery of those American Depositary Shares as provided in Section 5.9, and of all taxes and governmental charges and fees payable in connection with that deposit and the transfer of the deposited Shares.  However, the Depositary shall deliver only whole numbers of American Depositary Shares.

 

SECTION 2.4.                                          Registration of Transfer of American Depositary Shares; Combination and Split-up of Receipts; Interchange of Certificated and Uncertificated American Depositary Shares.

 

The Depositary, subject to the terms and conditions of this Deposit Agreement, shall register a transfer of American Depositary Shares on its transfer books upon (i) in the case of certificated American Depositary Shares, surrender of the Receipt evidencing those American Depositary Shares, by the Owner or by a duly authorized attorney, properly endorsed or accompanied by proper instruments of transfer or (ii) in the case of uncertificated American Depositary Shares, receipt from the Owner of a proper instruction (including, for the avoidance of doubt, instructions through DRS and Profile as provided in Section 2.10), and, in either case, duly stamped as may be required by the laws of the State of New York and of the United States of America. Upon registration of a transfer, the Depositary shall deliver the transferred American Depositary Shares to or upon the order of the person entitled thereto.

 

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The Depositary, subject to the terms and conditions of this Deposit Agreement, shall upon surrender of a Receipt or Receipts for the purpose of effecting a split-up or combination of such Receipt or Receipts, execute and deliver a new Receipt or Receipts for any authorized number of American Depositary Shares requested, evidencing the same aggregate number of American Depositary Shares as the Receipt or Receipts surrendered.

 

The Depositary, upon surrender of certificated American Depositary Shares for the purpose of exchanging for uncertificated American Depositary Shares, shall cancel the Receipt evidencing those certificated American Depositary Shares and send the Owner a statement confirming that the Owner is the owner of the same number of uncertificated American Depositary Shares.  The Depositary, upon receipt of a proper instruction (including, for the avoidance of doubt, instructions through DRS and Profile as provided in Section 2.10) from the Owner of uncertificated American Depositary Shares for the purpose of exchanging for certificated American Depositary Shares, shall cancel those uncertificated American Depositary Shares and register and deliver to the Owner a Receipt evidencing the same number of certificated American Depositary Shares.

 

The Depositary may appoint one or more co-transfer agents for the purpose of effecting registration of transfers of American Depositary Shares and combinations and split-ups of Receipts at designated transfer offices on behalf of the Depositary.  In carrying out its functions, a co-transfer agent may require evidence of authority and compliance with applicable laws and other requirements by Owners or persons entitled to American Depositary Shares and will be entitled to protection and indemnity to the same extent as the Depositary.

 

SECTION 2.5.                                          Surrender of American Depositary Shares and Withdrawal of Deposited Securities.

 

Upon surrender at the Depositary’s Office of American Depositary Shares for the purpose of withdrawal of the Deposited Securities represented thereby and payment of the fee of the Depositary for the surrender of American Depositary Shares as provided in Section 5.9 and payment of all taxes and governmental charges payable in connection with that surrender and withdrawal of the Deposited Securities, and subject to the terms and conditions of this Deposit Agreement, the Owner of those American Depositary Shares shall be entitled to delivery (to the extent delivery can then be lawfully and practicably made), to or as instructed by that Owner, of the amount of Deposited Securities at the time represented by those American Depositary Shares, but not any money or other property as to which a record date for distribution to Owners has passed (since money or other property of that kind will be delivered or paid on the scheduled payment date to the Owner as of that record date).  That delivery shall be made, as provided in this Section, without unreasonable delay.

 

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As a condition of accepting a surrender of American Depositary Shares for the purpose of withdrawal of Deposited Securities, the Depositary may require (i) that each surrendered Receipt be properly endorsed in blank or accompanied by proper instruments of transfer in blank and (ii) that the surrendering Owner execute and deliver to the Depositary a written order directing the Depositary to cause the Deposited Securities being withdrawn to be delivered to or upon the written order of a person or persons designated in that order.

 

Thereupon, the Depositary shall direct the Custodian to deliver, subject to Sections 2.6, 3.1 and 3.2, the other terms and conditions of this Deposit Agreement and local market rules and practices, to the surrendering Owner or to or upon the written order of the person or persons designated in the order delivered to the Depositary as above provided, the amount of Deposited Securities represented by the surrendered American Depositary Shares, and the Depositary may charge the surrendering Owner a fee and its expenses for giving that direction by cable (including SWIFT) or facsimile transmission.

 

At the request, risk and expense of an Owner surrendering American Depositary Shares for withdrawal of Deposited Securities, and for the account of that Owner, the Depositary shall direct the Custodian to forward any cash or other property comprising, and forward a certificate or certificates, if applicable, and other proper documents of title, if any, for, the Deposited Securities represented by the surrendered American Depositary Shares to the Depositary for delivery at the Depositary’s Office or to another address specified in the order received from the surrendering Owner.

 

SECTION 2.6.                                          Limitations on Delivery, Transfer and Surrender of American Depositary Shares.

 

As a condition precedent to the delivery, registration of transfer or surrender of any American Depositary Shares or split-up or combination of any Receipt or withdrawal of any Deposited Securities, the Depositary, Custodian or Registrar may require payment from the depositor of Shares or the presenter of the Receipt or instruction for registration of transfer or surrender of American Depositary Shares not evidenced by a Receipt of a sum sufficient to reimburse it for any tax or other governmental charge and any stock transfer or registration fee with respect thereto (including any such tax or charge and fee with respect to Shares being deposited or withdrawn) and payment of any applicable fees as provided in this Deposit Agreement, may require the production of proof satisfactory to it as to the identity and genuineness of any signature and may also require compliance with any regulations the Depositary may establish consistent with the provisions of this Deposit Agreement, including, without limitation, this Section 2.6.

 

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The delivery of American Depositary Shares against deposit of Shares generally or against deposit of particular Shares may be suspended, or the registration of transfer of American Depositary Shares in particular instances may be refused, or the registration of transfer of outstanding American Depositary Shares generally may be suspended, during any period when the transfer books of the Depositary are closed, or if any such action is deemed necessary or advisable by the Depositary or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission, or under any provision of this Deposit Agreement, or for any other reason.  Notwithstanding anything to the contrary in this Deposit Agreement, the surrender of outstanding American Depositary Shares and withdrawal of Deposited Securities may not be suspended, subject only to (i) temporary delays caused by closing of the transfer books of the Depositary or the Company or the Foreign Registrar, if applicable, or the deposit of Shares in connection with voting at a shareholders’ meeting, or the payment of dividends, (ii) the payment of fees, taxes and similar charges, and (iii) compliance with any U.S. or foreign laws or governmental regulations relating to the American Depositary Shares or to the withdrawal of the Deposited Securities.

 

The Depositary shall not knowingly accept for deposit under this Deposit Agreement any Shares that, at the time of deposit, are Restricted Securities.

 

SECTION 2.7.                                          Lost Receipts, etc.

 

If a Receipt is mutilated, destroyed, lost or stolen, the Depositary shall deliver to the Owner the American Depositary Shares evidenced by that Receipt in uncertificated form or, if requested by the Owner, execute and deliver a new Receipt of like tenor in exchange and substitution for such mutilated Receipt, upon surrender and cancellation of that mutilated Receipt, or in lieu of and in substitution for that destroyed, lost or stolen Receipt.  However, before the Depositary will deliver American Depositary Shares in uncertificated form or execute and deliver a new Receipt, in substitution for a destroyed, lost or stolen Receipt, the Owner must (a) file with the Depositary (i) a request for that replacement before the Depositary has notice that the Receipt has been acquired by a bona fide purchaser and (ii) a sufficient indemnity bond and (b) satisfy any other reasonable requirements imposed by the Depositary.

 

SECTION 2.8.                                          Cancellation and Destruction of Surrendered Receipts.

 

The Depositary shall cancel all Receipts surrendered to it and is authorized to destroy Receipts so cancelled.

 

SECTION 2.9.                                          Pre-Release of American Depositary Shares.

 

Notwithstanding Section 2.3, the Depositary may deliver American Depositary Shares prior to the receipt of Shares pursuant to Section 2.2 (a “Pre-Release”).  The Depositary may, pursuant to Section 2.5, deliver Shares upon the surrender of American Depositary Shares that have been Pre-Released, whether or not that surrender is prior to the termination of that Pre-Release or the Depositary knows that those American Depositary Shares have been Pre-Released.  The Depositary may receive American Depositary Shares in lieu of Shares in satisfaction of a Pre-Release.  Each Pre-Release must be (a) preceded or accompanied by a written representation from the person to whom American Depositary Shares or Shares are to be delivered, that such person, or its customer, owns the Shares or American Depositary Shares to be remitted, as the case may be, (b) at all times fully collateralized with cash or such other collateral as the Depositary deems appropriate, (c) terminable by the Depositary on not more than five (5) business days’ notice, and (d) subject to all indemnities and credit regulations that the Depositary deems appropriate.  The number of American Depositary Shares outstanding at any time as a result of Pre-Release will not normally exceed thirty percent (30%) of all American Depositary Shares outstanding; provided, however, that the Depositary reserves the right to change or disregard that limit from time to time as it deems appropriate.

 

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The Depositary may retain for its own account any compensation received by it in connection with Pre-Release.

 

SECTION 2.10.                                   DTC Direct Registration System and Profile Modification System.

 

(a)                                 Notwithstanding the provisions of Section 2.4, the parties acknowledge that DTC’s Direct Registration System (“DRS”) and Profile Modification System (“Profile”) apply to the American Depositary Shares upon acceptance thereof to DRS by DTC.  DRS is the system administered by DTC that facilitates interchange between registered holding of uncertificated securities and holding of security entitlements in those securities through DTC and a DTC participant.  Profile is a required feature of DRS that allows a DTC participant, claiming to act on behalf of an Owner of American Depositary Shares, to direct the Depositary to register a transfer of those American Depositary Shares to DTC or its nominee and to deliver those American Depositary Shares to the DTC account of that DTC participant without receipt by the Depositary of prior authorization from the Owner to register that transfer.

 

(b)                                 In connection with DRS/Profile, the parties acknowledge that the Depositary will not determine whether the DTC participant that is claiming to be acting on behalf of an Owner in requesting a registration of transfer and delivery as described in paragraph (a) above has the actual authority to act on behalf of that Owner (notwithstanding any requirements under the Uniform Commercial Code).  For the avoidance of doubt, the provisions of Sections 5.3 and 5.8 apply to the matters arising from the use of the DRS/Profile.  The parties agree that the Depositary’s reliance on and compliance with instructions received by the Depositary through the DRS/Profile system and otherwise in accordance with this Deposit Agreement shall not constitute negligence or bad faith on the part of the Depositary.

 

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ARTICLE 3.                               CERTAIN OBLIGATIONS OF OWNERS AND HOLDERS OF AMERICAN DEPOSITARY SHARES

 

SECTION 3.1.                                          Filing Proofs, Certificates and Other Information.

 

Any person presenting Shares for deposit or any Owner or Holder may be required from time to time to file with the Depositary or the Custodian such proof of citizenship or residence, exchange control approval, or such information relating to the registration on the books of the Company or the Foreign Registrar, if applicable, to execute such certificates and to make such representations and warranties, as the Depositary may deem necessary or proper.  The Depositary may withhold the delivery or registration of transfer of American Depositary Shares, the distribution of any dividend or other distribution or of the proceeds thereof or the delivery of any Deposited Securities until that proof or other information is filed or those certificates are executed or those representations and warranties are made.  The Depositary shall provide the Company, upon the Company’s written request and at the Company’s expense, as promptly as practicable, copies of any information or other materials that it receives pursuant to this Section 3.1, to the extent that disclosure is permitted under applicable law.

 

SECTION 3.2.                                          Liability of Owner for Taxes.

 

If any tax or other governmental charge shall become payable by the Custodian or the Depositary with respect to or in connection with any American Depositary Shares or any Deposited Securities represented by any American Depositary Shares or in connection with a transaction to which Section 4.8 applies, that tax or other governmental charge shall be payable by the Owner of those American Depositary Shares to the Depositary. The Depositary may refuse to register any transfer of those American Depositary Shares or any withdrawal of Deposited Securities represented by those American Depositary Shares until that payment is made, and may withhold any dividends or other distributions or the proceeds thereof, or may sell for the account of the Owner any part or all of the Deposited Securities represented by those American Depositary Shares and apply those dividends or other distributions or the net proceeds of any sale of that kind in payment of that tax or other governmental charge but, even after a sale of that kind, the Owner of those American Depositary Shares shall remain liable for any deficiency.  The Depositary shall distribute any net proceeds of a sale made under this Section that are not used to pay taxes or governmental charges to the Owners entitled to them in accordance with Section 4.1.  If the number of Shares represented by each American Depositary Share decreases as a result of a sale of Deposited Securities under this Section, the Depositary may call for surrender of the American Depositary Shares to be exchanged on a mandatory basis for a lesser number of American Depositary Shares and may sell American Depositary Shares to the extent necessary to avoid distributing fractions of American Depositary Shares in that exchange and distribute the net proceeds of that sale to the Owners entitled to them.

 

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SECTION 3.3.                                          Warranties on Deposit of Shares.

 

Every person depositing Shares under this Deposit Agreement shall be deemed thereby to represent and warrant that those Shares and each certificate therefor, if applicable, are validly issued, fully paid and nonassessable and were not issued in violation of any preemptive or similar rights of the holders of outstanding securities of the Company and that the person making that deposit is duly authorized so to do.  Every depositing person shall also be deemed to represent that the Shares, at the time of deposit, are not Restricted Securities.  All representations and warranties deemed made under this Section shall survive the deposit of Shares and delivery of American Depositary Shares.

 

SECTION 3.4.                                          Disclosure of Interests.

 

When required in order to comply with applicable laws and regulations or the articles of association or similar document of the Company, the Company may from time to time request each Owner and Holder to provide to the Depositary information relating to: (a) the capacity in which it holds American Depositary Shares, (b) the identity of any Holders or other persons or entities then or previously interested in those American Depositary Shares and the nature of those interests and (c) any other matter where disclosure of such matter is required for that compliance.   Each Owner and Holder agrees to provide all information known to it in response to a request made pursuant to this Section.  Each Holder consents to the disclosure by the Owner or any other Holder through which it holds American Depositary Shares, directly or indirectly, of all information responsive to a request made pursuant to this Section relating to that Holder that is known to that Owner or other Holder.  The Depositary agrees to use reasonable efforts, at the Company’s expense, to comply with written instructions requesting that the Depositary forward any request authorized under this Section to the Owners and to forward to the Company any responses it receives in response to that request.

 

ARTICLE 4.                           THE DEPOSITED SECURITIES

 

SECTION 4.1.                                          Cash Distributions.

 

Whenever the Depositary receives any cash dividend or other cash distribution on Deposited Securities, the Depositary shall, subject to the provisions of Section 4.5, convert that dividend or other distribution into Dollars and distribute the amount thus received (net of the fees and expenses of the Depositary as provided in Section 5.9) to the Owners entitled thereto, in proportion to the number of American Depositary Shares representing those Deposited Securities held by them respectively; provided, however, that if the Custodian or the Depositary shall be required to withhold and does withhold from that cash dividend or other cash distribution an amount on account of taxes or other governmental charges, the amount distributed to the Owners of the American Depositary Shares representing those Deposited Securities shall be reduced accordingly.  However, the Depositary will not pay any Owner a fraction of one cent, but will round each Owner’s entitlement to the nearest whole cent.

 

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The Company or its agent will remit to the appropriate governmental agency in each applicable jurisdiction all amounts withheld and owing to such agency.  The Depositary will forward to the Company or its agent such information from its records as the Company may reasonably request to enable the Company or its agent to file necessary reports with governmental agencies.

 

If a cash distribution would represent a return of all or substantially all the value of the Deposited Securities underlying American Depositary Shares, the Depositary may require surrender of those American Depositary Shares and may require payment of or deduct the fee for surrender of American Depositary Shares (whether or not it is also requiring surrender of American Depositary Shares) as a condition of making that cash distribution.  A distribution of that kind shall be a Termination Option Event.

 

SECTION 4.2.                                          Distributions Other Than Cash, Shares or Rights.

 

Subject to the provisions of Sections 4.11 and 5.9, whenever the Depositary receives any distribution other than a distribution described in Section 4.1, 4.3 or 4.4 on Deposited Securities (but not in exchange for or in conversion or in lieu of Deposited Securities), the Depositary shall cause the securities or property received by it to be distributed to the Owners entitled thereto, after deduction or upon payment of any fees and expenses of the Depositary and any taxes or other governmental charges, in proportion to the number of American Depositary Shares representing such Deposited Securities held by them respectively, in any manner that the Depositary deems equitable and practicable for accomplishing that distribution (which may be a distribution of depositary shares representing the securities received); provided, however, that if in the opinion of the Depositary such distribution cannot be made proportionately among the Owners entitled thereto, or if for any other reason (including, but not limited to, any requirement that the Company or the Depositary withhold an amount on account of taxes or other governmental charges or that securities received must be registered under the Securities Act of 1933 in order to be distributed to Owners or Holders) the Depositary deems such distribution not to be lawful and feasible, the Depositary may adopt such other method as it may deem equitable and practicable for the purpose of effecting such distribution, including, but not limited to, the public or private sale of the securities or property thus received, or any part thereof, and distribution of the net proceeds of any such sale (net of the fees and expenses of the Depositary as provided in Section 5.9) to the Owners entitled thereto, all in the manner and subject to the conditions set forth in Section 4.1.  The Depositary may withhold any distribution of securities under this Section 4.2 if it has not received satisfactory assurances from the Company that the distribution does not require registration under the Securities Act of 1933.  The Depositary may sell, by public or private sale, an amount of securities or other property it would otherwise distribute under this Section 4.2 that is sufficient to pay its fees and expenses in respect of that distribution.

 

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If a distribution under this Section 4.2 would represent a return of all or substantially all the value of the Deposited Securities underlying American Depositary Shares, the Depositary may require surrender of those American Depositary Shares and may require payment of or deduct the fee for surrender of American Depositary Shares (whether or not it is also requiring surrender of American Depositary Shares) as a condition of making that distribution.  A distribution of that kind shall be a Termination Option Event.

 

SECTION 4.3.                                          Distributions in Shares.

 

Whenever the Depositary receives any distribution on Deposited Securities consisting of a dividend in, or free distribution of, Shares, the Depositary may deliver to the Owners entitled thereto, in proportion to the number of American Depositary Shares representing those Deposited Securities held by them respectively, an aggregate number of American Depositary Shares representing the amount of Shares received as that dividend or free distribution, subject to the terms and conditions of this Deposit Agreement with respect to the deposit of Shares and issuance of American Depositary Shares, including withholding of any tax or governmental charge as provided in Section 4.11 and payment of the fees and expenses of the Depositary as provided in Section 5.9 (and the Depositary may sell, by public or private sale, an amount of the Shares received (or American Depositary Shares representing those Shares) sufficient to pay its fees and expenses in respect of that distribution).  In lieu of delivering fractional American Depositary Shares, the Depositary may sell the amount of Shares represented by the aggregate of those fractions (or American Depositary Shares representing those Shares) and distribute the net proceeds, all in the manner and subject to the conditions described in Section 4.1.  If and to the extent that additional American Depositary Shares are not delivered and Shares or American Depositary Shares are not sold, each American Depositary Share shall thenceforth also represent the additional Shares distributed on the Deposited Securities represented thereby.

 

If the Company declares a distribution in which holders of Deposited Securities have a right to elect whether to receive cash, Shares or other securities or a combination of those things, or a right to elect to have a distribution sold on their behalf, the Depositary may, after consultation with the Company, make that right of election available for exercise by Owners in any manner the Depositary considers to be lawful and practical.  As a condition of making a distribution election right available to Owners, the Depositary may require satisfactory assurances from the Company that doing so does not require registration of any securities under the Securities Act of 1933.

 

SECTION 4.4.                                          Rights.

 

(a)                                 If rights are granted to the Depositary in respect of deposited Shares to purchase additional Shares or other securities, the Company and the Depositary shall endeavor to consult as to the actions, if any, the Depositary should take in connection with that grant of rights.  The Depositary may, to the extent deemed by it to be lawful and practical (i) if requested in writing by the Company, grant to all or certain Owners rights to instruct the Depositary to purchase the securities to which the rights relate and deliver those securities or American Depositary Shares representing those securities to Owners, (ii) if requested in writing by the Company, deliver the rights to or to the order of certain Owners, or (iii) sell the rights to the extent practicable and distribute the net proceeds of that sale to Owners entitled to those proceeds.  To the extent rights are not exercised, delivered or disposed of under (i), (ii) or (iii) above, the Depositary shall permit the rights to lapse unexercised.

 

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(b)                                 If the Depositary will act under (a)(i) above, the Company and the Depositary will enter into a separate agreement setting forth the conditions and procedures applicable to the particular offering.  Upon instruction from an applicable Owner in the form the Depositary specified and upon payment by that Owner to the Depositary of an amount equal to the purchase price of the securities to be received upon the exercise of the rights, the Depositary shall, on behalf of that Owner, exercise the rights and purchase the securities.  The purchased securities shall be delivered to, or as instructed by, the Depositary.  The Depositary shall (i) deposit the purchased Shares under this Deposit Agreement and deliver American Depositary Shares representing those Shares to that Owner or (ii) deliver or cause the purchased Shares or other securities to be delivered to or to the order of that Owner.  The Depositary will not act under (a)(i) above unless the offer and sale of the securities to which the rights relate are registered under the Securities Act of 1933 or the Depositary has received an opinion of United States counsel that is satisfactory to it to the effect that those securities may be sold and delivered to the applicable Owners without registration under the Securities Act of 1933.

 

(c)                                  If the Depositary will act under (a)(ii) above, the Company and the Depositary will enter into a separate agreement setting forth the conditions and procedures applicable to the particular offering.  Upon (i) the request of an applicable Owner to deliver the rights allocable to the American Depositary Shares of that Owner to an account specified by that Owner to which the rights can be delivered and (ii) receipt of such documents as the Company and the Depositary agreed to require to comply with applicable law, the Depositary will deliver those rights as requested by that Owner.

 

(d)                                 If the Depositary will act under (a)(iii) above, the Depositary will use reasonable efforts to sell the rights in proportion to the number of American Depositary Shares held by the  applicable Owners and pay the net proceeds to the Owners otherwise entitled to the rights that were sold, upon an averaged or other practical basis without regard to any distinctions among such Owners because of exchange restrictions or the date of delivery of any American Depositary Shares or otherwise.

 

(e)                                  Payment or deduction of the fees of the Depositary as provided in Section 5.9 and payment or deduction of the expenses of the Depositary and any applicable taxes or other governmental charges shall be conditions of any delivery of securities or payment of cash proceeds under this Section 4.4.

 

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(f)                                   The Depositary shall not be responsible for any failure to determine that it may be lawful or feasible to make rights available to or exercise rights on behalf of Owners in general or any Owner in particular, or to sell rights.

 

SECTION 4.5.                                          Conversion of Foreign Currency.

 

Whenever the Depositary or the Custodian receives foreign currency, by way of dividends or other distributions or the net proceeds from the sale of securities, property or rights, and if at the time of the receipt thereof the foreign currency so received can in the judgment of the Depositary be converted on a reasonable basis into Dollars and the resulting Dollars transferred to the United States, the Depositary shall convert or cause to be converted, as promptly as practicable, by sale or in any other manner that it may determine that foreign currency into Dollars, and those Dollars shall be distributed to the Owners entitled thereto.  A cash distribution may be made upon an averaged or other practicable basis without regard to any distinctions among Owners based on exchange restrictions, the date of delivery of any American Depositary Shares or otherwise and shall be net of any expenses of conversion into Dollars incurred by the Depositary as provided in Section 5.9.

 

If a conversion of foreign currency or the repatriation or distribution of Dollars can be effected only with the approval or license of any government or agency thereof, the Depositary may, but will not be required to, file an application for that approval or license.

 

If the Depositary determines that in its judgment any foreign currency received by the Depositary or the Custodian is not convertible on a reasonable basis into Dollars transferable to the United States, or if any approval or license of any government or agency thereof that is required for such conversion is not filed or sought by the Depositary or is not obtained within a reasonable period as determined by the Depositary, the Depositary may distribute the foreign currency received by the Depositary to, or in its discretion may hold such foreign currency uninvested and without liability for interest thereon for the respective accounts of, the Owners entitled to receive the same.

 

If any conversion of foreign currency, in whole or in part, cannot be effected for distribution to some of the Owners entitled thereto, the Depositary may in its discretion make that conversion and distribution in Dollars to the extent practicable and permissible to the Owners entitled thereto and may distribute the balance of the foreign currency received by the Depositary to, or hold that balance uninvested and without liability for interest thereon for the account of, the Owners entitled thereto.

 

The Depositary may convert currency itself or through any of its affiliates and, in those cases, acts as principal for its own account and not as agent, advisor, broker or fiduciary on behalf of any other person and earns revenue, including, without limitation, transaction spreads, that it will retain for its own account.  The revenue is based on, among other things, the difference between the exchange rate assigned to the currency conversion made under this Deposit Agreement and the rate that the Depositary or its affiliate receives when buying or selling foreign currency for its own account.  The Depositary makes no representation that the exchange rate used or obtained in any currency conversion under this Deposit Agreement will be the most favorable rate that could be obtained at the time or that the method by which that rate will be determined will be the most favorable to Owners, subject to the Depositary’s obligations under Section 5.3.  The methodology used to determine exchange rates used in currency conversions is available upon request.

 

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SECTION 4.6.                                          Fixing of Record Date.

 

Whenever a cash dividend, cash distribution or any other distribution is made on Deposited Securities or rights to purchase Shares or other securities are issued with respect to Deposited Securities (which rights will be delivered to or exercised or sold on behalf of Owners in accordance with Section 4.4) or the Depositary receives notice that a distribution or issuance of that kind will be made, or whenever the Depositary receives notice that a meeting of holders of Shares will be held in respect of which the Company has requested the Depositary to send a notice under Section 4.7, or whenever the Depositary will assess a fee or charge against the Owners, or whenever the Depositary causes a change in the number of Shares that are represented by each American Depositary Share, or whenever the Depositary otherwise finds it necessary or convenient, the Depositary shall fix a record date, which shall be the same as, or as near as practicable to, any corresponding record date set by the Company with respect to Shares, (a) for the determination of the Owners (i) who shall be entitled to receive the benefit of that dividend or other distribution or those rights, (ii) who shall be entitled to give instructions for the exercise of voting rights at that meeting or (iii) who shall be responsible for that fee or charge or (iv) for any other purpose for which the record date was set, or (b) on or after which each American Depositary Share will represent the changed number of Shares.  Subject to the provisions of Sections 4.1 through 4.5 and to the other terms and conditions of this Deposit Agreement, the Owners on a record date fixed by the Depositary shall be entitled to receive the amount distributable by the Depositary with respect to that dividend or other distribution or those rights or the net proceeds of sale thereof in proportion to the number of American Depositary Shares held by them respectively, to give voting instructions or to act in respect of the other matter for which that record date was fixed, or be responsible for that fee or charge, as the case may be.

 

SECTION 4.7.                                          Voting of Deposited Shares.

 

(a)                                 Upon receipt of notice of any meeting of holders of Shares at which holders of Shares will be entitled to vote, if requested in writing by the Company, the Depositary shall, as soon as practicable thereafter, Disseminate to the Owners a notice, the form of which shall be in the sole discretion of the Depositary, that shall contain (i) the information contained in the notice of meeting received by the Depositary, (ii) a statement that the Owners as of the close of business on a specified record date will be entitled, subject to any applicable provision of Cayman Islands law and of the articles of association or similar documents of the Company, to instruct the Depositary as to the exercise of the voting rights pertaining to the amount of Shares represented by their respective American Depositary Shares, (iii) a statement as to the manner in which those instructions may be given, including an express indication that instructions may be given or deemed given in accordance with the last sentence of paragraph (b) below if no instruction is received, to the Depositary to give a discretionary proxy to a person designated by the Company, and (iv) the last date on which the Depositary will accept instructions (the “Instruction Cutoff Date”).

 

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(b)                                 Upon the written request of an Owner of American Depositary Shares, as of the date of the request or, if a record date was specified by the Depositary as of that record date, received on or before any Instruction Cutoff Date established by the Depositary, the Depositary may, and if the Depositary sent a notice under the preceding paragraph shall, endeavor, in so far as practicable, to vote or cause to be voted the amount of deposited Shares represented by those American Depositary Shares in accordance with the instructions set forth in that request.  The Depositary shall not vote or attempt to exercise the right to vote that attaches to the deposited Shares other than in accordance with instructions given by Owners and received by the Depositary or as provided in the following sentence. If (i) the Company instructed the Depositary to Disseminate a notice under paragraph (a) above and complied with paragraph (d) below and (ii) no instructions are received by the Depositary from an Owner with respect to a matter and an amount of American Depositary Shares of that Owner on or before the Instruction Cutoff Date, the Depositary shall deem that Owner to have instructed the Depositary to give a discretionary proxy to a person designated by the Company with respect to that matter and the amount of deposited Shares represented by that amount of American Depositary Shares and the Depositary shall give a discretionary proxy to a person designated by the Company to vote that amount of deposited Shares as to that matter, except that no instruction of that kind shall be deemed given and no discretionary proxy shall be given with respect to any matter as to which the Company informs the Depositary (and the Company agrees to provide such information as promptly as practicable in writing, if applicable) that (x) the Company does not wish a proxy given, (y) substantial opposition exists or (z) the matter materially and adversely affects the rights of holders of Shares.

 

(c)                                  There can be no assurance that Owners generally or any Owner in particular will receive the notice described in paragraph (a) above in time to enable Owners to give instructions to the Depositary prior to the Instruction Cutoff Date.

 

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(d)                                 In order to give Owners a reasonable opportunity to instruct the Depositary as to the exercise of voting rights relating to Shares, if the Company will request the Depositary to Disseminate a notice under paragraph (a) above, the Company shall give the Depositary notice of the meeting, details concerning the matters to be voted upon and copies of materials to be made available to holders of Shares in connection with the meeting not less than 30 days prior to the meeting date.

 

SECTION 4.8.                                          Tender and Exchange Offers; Redemption, Replacement or Cancellation of Deposited Securities.

 

(a)                                 The Depositary shall not tender any Deposited Securities in response to any voluntary cash tender offer, exchange offer or similar offer made to holders of Deposited Securities (a “Voluntary Offer”), except when instructed in writing to do so by an Owner surrendering American Depositary Shares and subject to any conditions or procedures the Depositary may require.

 

(b)                                 If the Depositary receives a written notice that Deposited Securities have been redeemed for cash or otherwise purchased for cash in a transaction that is mandatory and binding on the Depositary as a holder of those Deposited Securities (a “Redemption”), the Depositary, at the expense of the Company, shall (i) if required, surrender Deposited Securities that have been redeemed to the issuer of those securities or its agent on the redemption date, (ii) Disseminate a notice to Owners (A) notifying them of that Redemption, (B) calling for surrender of a corresponding number of American Depositary Shares and (C) notifying them that the called American Depositary Shares have been converted into a right only to receive the money received by the Depositary upon that Redemption and those net proceeds shall be the Deposited Securities to which Owners of those converted American Depositary Shares shall be entitled upon surrenders of those American Depositary Shares in accordance with Section 2.5 or 6.2 and (iii) distribute the money received upon that Redemption to the Owners entitled to it upon surrender by them of called American Depositary Shares in accordance with Section 2.5 (and, for the avoidance of doubt, Owners shall not be entitled to receive that money under Section 4.1).  If the Redemption affects less than all the Deposited Securities, the Depositary shall call for surrender a corresponding portion of the outstanding American Depositary Shares and only those American Depositary Shares will automatically be converted into a right to receive the net proceeds of the Redemption.  The Depositary shall allocate the American Depositary Shares converted under the preceding sentence among the Owners pro-rata to their respective holdings of American Depositary Shares immediately prior to the Redemption, except that the allocations may be adjusted so that no fraction of a converted American Depositary Share is allocated to any Owner.  A Redemption of all or substantially all of the Deposited Securities shall be a Termination Option Event.

 

(c)                                  If the Depositary is notified of or there occurs any change in nominal value or any subdivision, combination or any other reclassification of the Deposited Securities or any recapitalization, reorganization, sale of assets substantially as an entirety, merger or consolidation affecting the issuer of the Deposited Securities or to which it is a party that is mandatory and binding on the Depositary as a holder of Deposited Securities and, as a result, securities or other property have been or will be delivered in exchange, conversion, replacement or in lieu of, Deposited Securities (a “Replacement”), the Depositary shall, if required, surrender the old Deposited Securities affected by that Replacement of Shares and hold, as new Deposited Securities under this Deposit Agreement, the new securities or other property delivered to it in that Replacement.  However, the Depositary may elect to sell those new Deposited Securities if in the opinion of the Depositary it is not lawful or not practical for it to hold those new Deposited Securities under this Deposit Agreement because those new Deposited Securities may not be distributed to Owners without registration under the Securities Act of 1933 or for any other reason, at public or private sale, at such places and on such terms as it deems proper and proceed as if those new Deposited Securities had been Redeemed under paragraph (b) above.  A Replacement shall be a Termination Option Event.

 

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(d)                                 In the case of a Replacement where the new Deposited Securities will continue to be held under this Deposit Agreement, the Depositary may call for the surrender of outstanding Receipts to be exchanged for new Receipts specifically describing the new Deposited Securities and the number of those new Deposited Securities represented by each American Depositary Share.  If the number of Shares represented by each American Depositary Share decreases as a result of a Replacement, the Depositary may call for surrender of the American Depositary Shares to be exchanged on a mandatory basis for a lesser number of American Depositary Shares and may sell American Depositary Shares to the extent necessary to avoid distributing fractions of American Depositary Shares in that exchange and distribute the net proceeds of that sale to the Owners entitled to them.

 

(e)                                  If there are no Deposited Securities with respect to American Depositary Shares, including if the Deposited Securities are cancelled, or the Deposited Securities with respect to American Depositary Shares have become apparently worthless, the Depositary may call for surrender of those American Depositary Shares or may cancel those American Depositary Shares, upon notice to Owners, and a Termination Option Event occurs.

 

SECTION 4.9.                                          Reports.

 

The Depositary shall make available for inspection by Owners at its Office any reports, notices and other communications, including any proxy solicitation material, received from the Company which are both (a) received by the Depositary as the holder of the Deposited Securities and (b) made generally available to the holders of those Deposited Securities by the Company.  The Company shall furnish reports and communications, including any proxy soliciting material to which this Section applies, to the Depositary in English, to the extent those materials are required to be translated into English pursuant to any regulations of the Commission.

 

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SECTION 4.10.                                   Lists of Owners.

 

Upon written request by the Company, the Depositary shall, at the expense of the Company, furnish to it a list, as of a recent date, of the names, addresses and American Depositary Share holdings of all Owners.

 

SECTION 4.11.                                   Withholding.

 

If the Depositary determines that any distribution received or to be made by the Depositary (including Shares and rights to subscribe therefor) is subject to any tax or other governmental charge that the Depositary is obligated to withhold, the Depositary may sell, by public or private sale, all or a portion of the distributed property (including Shares and rights to subscribe therefor) in the amounts and manner the Depositary deems necessary and practicable to pay those taxes or charges, and the Depositary shall distribute the net proceeds of that sale, after deduction of those taxes or charges, to the Owners entitled thereto in proportion to the number of American Depositary Shares held by them respectively.

 

Services for Owners and Holders that may permit them to obtain reduced rates of tax withholding at source or reclaim excess tax withheld, and the fees and costs associated with using services of that kind, are not provided under, and are outside the scope of, this Deposit Agreement.

 

Each Owner and Holder agrees to indemnify the Company, the Depositary, the Custodian and their respective directors, employees, agents and affiliates for, and hold each of them harmless against, any claim by any governmental authority with respect to taxes, additions to tax, penalties or interest arising out of any refund of taxes, reduced withholding at source or other tax benefit received by it.

 

ARTICLE 5.   THE DEPOSITARY, THE CUSTODIANS AND THE COMPANY

 

SECTION 5.1.                                          Maintenance of Office and Transfer Books by the Depositary.

 

Until termination of this Deposit Agreement in accordance with its terms, the Depositary shall maintain facilities for the execution and delivery, registration, registration of transfers and surrender of American Depositary Shares in accordance with the provisions of this Deposit Agreement.

 

The Depositary shall keep books for the registration of American Depositary Shares, which shall be open for inspection by the Owners at the Depositary’s Office during regular business hours, provided that such inspection is not for the purpose of communicating with Owners in the interest of a business or object other than the business of the Company or a matter related to this Deposit Agreement or the American Depositary Shares.

 

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The Depositary may close the transfer books, at any time or from time to time, when deemed expedient by it in connection with the performance of its duties under this Deposit Agreement.

 

If any American Depositary Shares are listed on one or more stock exchanges, the Depositary shall act as Registrar or appoint a Registrar or one or more co-registrars for registry of those American Depositary Shares in accordance with any requirements of that exchange or those exchanges.

 

SECTION 5.2.                                          Prevention or Delay of Performance by the Company or the Depositary.

 

Neither the Depositary nor the Company nor any of their respective directors, employees, agents or affiliates shall incur any liability to any Owner or Holder:

 

(i) if by reason of (A) any provision of any present or future law or regulation or other act of the government of the United States, any State of the United States or any other state or jurisdiction, or of any governmental or regulatory authority or stock exchange; (B) (in the case of the Depositary only) any provision, present or future, of the articles of association or similar document of the Company, or by reason of any provision of any securities issued or distributed by the Company, or any offering or distribution thereof; or (C) any event or circumstance, whether natural or caused by a person or persons, that is beyond the ability of the Depositary or the Company, as the case may be, to prevent or counteract by reasonable care or effort (including, but not limited to earthquakes, floods, severe storms, fires, explosions, war, terrorism, civil unrest, labor disputes or criminal acts; interruptions or malfunctions of utility services, Internet or other communications lines or systems; unauthorized access to or attacks on computer systems or websites; or other failures or malfunctions of computer hardware or software or other systems or equipment), the Depositary or the Company is, directly or indirectly, prevented from, forbidden to or delayed in, or could be subject to any civil or criminal penalty on account of doing or performing and therefore does not do or perform, any act or thing that, by the terms of this Deposit Agreement or the Deposited Securities, it is provided shall be done or performed;

 

(ii) for any exercise of, or failure to exercise, any discretion provided for in this Deposit Agreement (including any determination by the Depositary to take, or not take, any action that this Deposit Agreement provides the Depositary may take);

 

(iii) for the inability of any Owner or Holder to benefit from any distribution, offering, right or other benefit that is made available to holders of Deposited Securities but is not, under the terms of this Deposit Agreement, made available to Owners or Holders; or

 

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(iv) for any special, consequential or punitive damages for any breach of the terms of this Deposit Agreement.

 

Where, by the terms of a distribution to which Section 4.1, 4.2 or 4.3 applies, or an offering to which Section 4.4 applies, or for any other reason, that distribution or offering may not be made available to Owners, and the Depositary may not dispose of that distribution or offering on behalf of Owners and make the net proceeds available to Owners, then the Depositary shall not make that distribution or offering available to Owners, and shall allow any rights, if applicable, to lapse.

 

SECTION 5.3.                                          Obligations of the Depositary and the Company.

 

The Company assumes no obligation nor shall it be subject to any liability under this Deposit Agreement to any Owner or Holder, except that the Company agrees to perform its obligations specifically set forth in this Deposit Agreement without negligence or bad faith.

 

The Depositary assumes no obligation nor shall it be subject to any liability under this Deposit Agreement to any Owner or Holder (including, without limitation, liability with respect to the validity or worth of the Deposited Securities), except that the Depositary agrees to perform its obligations specifically set forth in this Deposit Agreement without negligence or bad faith.

 

Neither the Depositary nor the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of any Deposited Securities or in respect of the American Depositary Shares on behalf of any Owner or Holder or any other person.

 

Each of the Depositary and the Company may rely, and shall be protected in relying upon, any written notice, request, direction or other document believed by it to be genuine and to have been signed or presented by the proper party or parties.

 

Neither the Depositary nor the Company shall be liable for any action or non-action by it in reliance upon the advice of or information from legal counsel, accountants, any person presenting Shares for deposit, any Owner or any other person believed by it in good faith to be competent to give such advice or information.

 

The Depositary shall not be liable for any acts or omissions made by a successor depositary whether in connection with a previous act or omission of the Depositary or in connection with any matter arising wholly after the removal or resignation of the Depositary, provided that in connection with the issue out of which such potential liability arises the Depositary performed its obligations without negligence or bad faith while it acted as Depositary.

 

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The Depositary shall not be liable for the acts or omissions of any securities depository, clearing agency or settlement system in connection with or arising out of book-entry settlement of American Depositary Shares or Deposited Securities or otherwise.

 

In the absence of bad faith on its part, the Depositary shall not be responsible for any failure to carry out any instructions to vote any of the Deposited Securities, or for the manner in which any such vote is cast or the effect of any such vote.

 

The Depositary shall have no duty to make any determination or provide any information as to the tax status of the Company or any liability for any tax consequences that may be incurred by Owners or Holders as a result of owning or holding American Depositary Shares.

 

No disclaimer of liability under the Securities Act of 1933 is intended by any provision of this Deposit Agreement.

 

SECTION 5.4.                                          Resignation and Removal of the Depositary.

 

The Depositary may at any time resign as Depositary hereunder by written notice of its election so to do delivered to the Company, to become effective upon the appointment of a successor depositary and its acceptance of that appointment as provided in this Section.  The effect of resignation if a successor depositary is not appointed is provided for in Section 6.2.

 

The Depositary may at any time be removed by the Company by 90 days’ prior written notice of that removal, to become effective upon the later of (i) the 90th day after delivery of the notice to the Depositary and (ii) the appointment of a successor depositary and its acceptance of its appointment as provided in this Section.

 

If the Depositary resigns or is removed, the Company shall use its reasonable efforts to appoint a successor depositary, which shall be a bank or trust company having an office in the Borough of Manhattan, The City of New York.  Every successor depositary shall execute and deliver to the Company an instrument in writing accepting its appointment under this Deposit Agreement.  If the Depositary receives notice from the Company that a successor depositary has been appointed following its resignation or removal, the Depositary, upon payment of all sums due it from the Company, shall deliver to its successor a register listing all the Owners and their respective holdings of outstanding American Depositary Shares and shall deliver the Deposited Securities to or to the order of its successor.  When the Depositary has taken the actions specified in the preceding sentence (i) the successor shall become the Depositary and shall have all the rights and shall assume all the duties of the Depositary under this Deposit Agreement and (ii) the predecessor depositary shall cease to be the Depositary and shall be discharged and released from all obligations under this Deposit Agreement, except for its duties under Section 5.8 with respect to the time before that discharge.  A successor Depositary shall notify the Owners of its appointment as soon as practical after assuming the duties of Depositary.

 

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Any corporation or other entity into or with which the Depositary may be merged or consolidated shall be the successor of the Depositary without the execution or filing of any document or any further act.

 

SECTION 5.5.                                          The Custodians.

 

The Custodian shall be subject at all times and in all respects to the directions of the Depositary and shall be responsible solely to it.  The Depositary in its discretion may at any time appoint a substitute or additional custodian or custodians, each of which shall thereafter be one of the Custodians under this Deposit Agreement.  If the Depositary receives notice that a Custodian is resigning and, upon the effectiveness of that resignation there would be no Custodian acting under this Deposit Agreement, the Depositary shall, as promptly as practicable after receiving that notice, appoint a substitute custodian or custodians, each of which shall thereafter be a Custodian under this Deposit Agreement.  The Depositary shall require any Custodian that resigns or is removed to deliver all Deposited Securities held by it to another Custodian.

 

SECTION 5.6.                                          Notices and Reports.

 

If the Company takes or decides to take any corporate action of a kind that is addressed in Sections 4.1 to 4.4, or 4.6 to 4.8, or that effects or will effect a change of the name or legal structure of the Company, or that effects or will effect a change to the Shares, the Company shall notify the Depositary and the Custodian of that action or decision as soon as it is lawful and practical to give that notice.  The notice shall be in English and shall include all details that the Company is required to include in any notice to any governmental or regulatory authority or securities exchange or is required to make available generally to holders of Shares by publication or otherwise.

 

The Company will arrange for the translation into English, if not already in English, to the extent required pursuant to any regulations of the Commission, and the prompt transmittal by the Company to the Depositary and the Custodian of all notices and any other reports and communications which are made generally available by the Company to holders of its Shares.  If requested in writing by the Company, the Depositary will Disseminate, at the Company’s expense, those notices, reports and communications to all Owners or otherwise make them available to Owners in a manner that the Company specifies as substantially equivalent to the manner in which those communications are made available to holders of Shares and compliant with the requirements of any securities exchange on which the American Depositary Shares are listed.  The Company will timely provide the Depositary with the quantity of such notices, reports, and communications, as requested by the Depositary from time to time, in order for the Depositary to effect that Dissemination.

 

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The Company represents that as of the date of this Deposit Agreement, the statements in Article 11 of the Receipt with respect to the Company’s obligation to file periodic reports under the United States Securities Exchange Act of 1934, as amended, are true and correct.  The Company agrees to promptly notify the Depositary upon becoming aware of any change in the truth of any of those statements.

 

SECTION 5.7.                                          Distribution of Additional Shares, Rights, etc.

 

If the Company or any affiliate of the Company determines to make any issuance or distribution of (1) additional Shares, (2) rights to subscribe for Shares, (3) securities convertible into Shares, or (4) rights to subscribe for such securities (each a “Distribution”), the Company shall notify the Depositary in writing in English as promptly as practicable and in any event before the Distribution starts and, if reasonably requested in writing by the Depositary, the Company shall furnish to the Depositary either (i) evidence satisfactory to the Depositary that the Distribution is registered under the Securities Act of 1933 or (ii) a written opinion from U.S. counsel for the Company that is reasonably satisfactory to the Depositary, stating that the Distribution does not require, or, if made in the United States, would not require, registration under the Securities Act of 1933.

 

The Company agrees with the Depositary that neither the Company nor any company controlled by, controlling or under common control with the Company will at any time deposit any Shares that, at the time of deposit, are Restricted Securities.

 

SECTION 5.8.                                          Indemnification.

 

The Company agrees to indemnify the Depositary, its directors, employees, agents and affiliates and each Custodian against, and hold each of them harmless from, any liability or expense (including but not limited to any fees and expenses incurred in seeking, enforcing or collecting such indemnity and the reasonable fees and expenses of counsel) that may arise out of or in connection with (a) any registration with the Commission of American Depositary Shares or Deposited Securities or the offer or sale thereof in the United States or (b) acts performed or omitted, pursuant to the provisions of or in connection with this Deposit Agreement and the American Depositary Shares, as the same may be amended, modified or supplemented from time to time, (i) by either the Depositary or a Custodian or their respective directors, employees, agents and affiliates, except for any liability or expense arising out of the negligence or bad faith of either of them, or (ii) by the Company or any of its directors, employees, agents and affiliates.

 

The indemnities contained in the preceding paragraph shall not extend to any Losses arising out of information relating to the Depositary or any Custodian, as the case may be, furnished in writing by the Depositary to the Company expressly for use in any registration statement, proxy statement, prospectus or preliminary prospectus or any other offering documents relating to the American Depositary Share, the Shares or any other Deposited Securities (it being acknowledged that, as of the date of this Deposit Agreement, the Depositary has not furnished any information of that kind).  The indemnities contained in the preceding paragraph shall not extend to any liability or expense which arises solely and exclusively out of a Pre-Release (as defined in Section 2.9) of American Depositary Shares pursuant to Section 2.9 and which would not otherwise have arisen had those American Depositary Shares not been the subject of a Pre-Release pursuant to Section 2.9; provided, however, that the indemnities provided in the preceding paragraph shall apply to any such liability or expense (i) to the extent that such liability or expense would have arisen had those American Depositary Shares not be the subject of a Pre-Release, or (ii) which may arise out of any misstatement or alleged misstatement or omission or alleged omission in any registration statement, proxy statement, prospectus (or placement memorandum), or preliminary prospectus (or preliminary placement memorandum) relating to the offer or sale of American Depositary Shares, except to the extent any such liability or expense arises out of (x) information relating to the Depositary or any Custodian (other than the Company), as applicable, furnished in writing and not materially changed or altered by the Company expressly for use in any of the foregoing documents, or, (y) if such information is provided, the failure to state a material fact necessary to make the information provided not misleading.

 

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The Depositary agrees to indemnify the Company, its directors, employees, agents and affiliates and hold them harmless from any liability or expense (including but not limited to any fees and expenses incurred in seeking, enforcing or collecting such indemnity and the reasonable fees and expenses of counsel) that may arise out of acts performed or omitted by the Depositary or any Custodian or their respective directors, employees, agents and affiliates due to their negligence or bad faith.

 

SECTION 5.9.                                          Charges of Depositary.

 

The following charges shall be incurred by any party depositing or withdrawing Shares or by any party surrendering American Depositary Shares or to whom American Depositary Shares are issued (including, without limitation, issuance pursuant to a stock dividend or stock split declared by the Company or an exchange of stock regarding the American Depositary Shares or Deposited Securities or a delivery of American Depositary Shares pursuant to Section 4.3), or by Owners, as applicable:  (1) taxes and other governmental charges, (2) such registration fees as may from time to time be in effect for the registration of transfers of Shares generally on the Share register of the Company or Foreign Registrar and applicable to transfers of Shares to or from the name of the Depositary or its nominee or the Custodian or its nominee on the making of deposits or withdrawals hereunder, (3) such cable (including SWIFT) and facsimile transmission fees and expenses as are expressly provided in this Deposit Agreement, (4) such expenses as are incurred by the Depositary in the conversion of foreign currency pursuant to Section 4.5, (5) a fee of $5.00 or less per 100 American Depositary Shares (or portion thereof) for the delivery of American Depositary Shares pursuant to Section 2.3, 4.3 or 4.4 and the surrender of American Depositary Shares pursuant to Section 2.5 or 6.2, (6) a fee of $.05 or less per American Depositary Share (or portion thereof) for any cash distribution made pursuant to this Deposit Agreement, including, but not limited to Sections 4.1 through 4.4 and Section 4.8, (7) a fee for the distribution of securities pursuant to Section 4.2 or of rights pursuant to Section 4.4 (where the Depositary will not exercise or sell those rights on behalf of Owners), such fee being in an amount equal to the fee for the execution and delivery of American Depositary Shares referred to above which would have been charged as a result of the deposit of such securities under this Deposit Agreement (for purposes of this item 7 treating all such securities as if they were Shares) but which securities are instead distributed by the Depositary to Owners, (8) in addition to any fee charged under item 6 above, a fee of $.05 or less per American Depositary Share (or portion thereof) per annum for depositary services, which will be payable as provided in item 9 below, and (9) any other charges payable by the Depositary or the Custodian, any of the Depositary’s or Custodian’s agents or the agents of the Depositary’s or Custodian’s agents, in connection with the servicing of Shares or other Deposited Securities (which charges shall be assessed against Owners as of the date or dates set by the Depositary in accordance with Section 4.6 and shall be payable at the sole discretion of the Depositary by billing those Owners for those charges or by deducting those charges from one or more cash dividends or other cash distributions).

 

29

 

The Depositary may collect any of its fees by deduction from any cash distribution payable, or by selling a portion of any securities to be distributed, to Owners that are obligated to pay those fees.

 

In performing its duties under this Deposit Agreement, the Depositary may use brokers, dealers, foreign currency dealers or other service providers that are owned by or affiliated with the Depositary and that may earn or share fees, spreads or commissions.

 

The Depositary, subject to Section 2.9, may own and deal in any class of securities of the Company and its affiliates and in American Depositary Shares.

 

SECTION 5.10.                                   Retention of Depositary Documents.

 

The Depositary is authorized to destroy those documents, records, bills and other data compiled during the term of this Deposit Agreement at the times permitted by the laws or regulations governing the Depositary, unless the Company requests that those papers be retained for a longer period or turned over to the Company or to a successor depositary.

 

30

 

SECTION 5.11.                                   Exclusivity.

 

Without prejudice to the Company’s rights under Section 5.4, the Company agrees not to appoint any other depositary for issuance of depositary shares, depositary receipts or any similar securities or instruments so long as The Bank of New York Mellon is acting as Depositary under this Deposit Agreement.

 

ARTICLE 6.                                                   AMENDMENT AND TERMINATION

 

SECTION 6.1.                                          Amendment.

 

The form of the Receipts and any provisions of this Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary without the consent of Owners or Holders in any respect that they may deem necessary or desirable.  Any amendment that would impose or increase any fees or charges (other than taxes and other governmental charges, registration fees, cable, telex or facsimile transmission costs, delivery costs or other such expenses), or that would otherwise prejudice any substantial existing right of Owners, shall, however, not become effective as to outstanding American Depositary Shares until the expiration of 30 days after notice of that amendment has been Disseminated to the Owners of outstanding American Depositary Shares. Every Owner and Holder, at the time any amendment so becomes effective, shall be deemed, by continuing to hold American Depositary Shares or any interest therein, to consent and agree to that amendment and to be bound by this Deposit Agreement as amended thereby. Upon the effectiveness of an amendment to the form of Receipt, including a change in the number of Shares represented by each American Depositary Share, the Depositary may call for surrender of Receipts to be replaced with new Receipts in the amended form or call for surrender of American Depositary Shares to effect that change of ratio.  In no event shall any amendment impair the right of the Owner to surrender American Depositary Shares and receive delivery of the Deposited Securities represented thereby, except in order to comply with mandatory provisions of applicable law.

 

SECTION 6.2.                                          Termination.

 

(a)                                 The Company may initiate termination of this Deposit Agreement by notice to the Depositary.  The Depositary may initiate termination of this Deposit Agreement if (i) at any time 90 days shall have expired after the Depositary delivered to the Company a written resignation notice and a successor depositary has not been appointed and accepted its appointment as provided in Section 5.4, (ii) an Insolvency Event or Delisting Event occurs with respect to the Company or (iii) a Termination Option Event has occurred or will occur.  If termination of this Deposit Agreement is initiated, the Depositary shall Disseminate a notice of termination to the Owners of all American Depositary Shares then outstanding setting a date for termination (the “Termination Date”), which shall be at least 90 days after the date of that notice, and this Deposit Agreement shall terminate on that Termination Date.

 

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(b)                                 After the Termination Date, the Company shall be discharged from all obligations under this Deposit Agreement except for its obligations to the Depositary under Sections 5.8 and 5.9.

 

(c)                                  At any time after the Termination Date, the Depositary may sell the Deposited Securities then held under this Deposit Agreement and may thereafter hold uninvested the net proceeds of any such sale, together with any other cash then held by it hereunder, unsegregated and without liability for interest, for the pro rata benefit of the Owners of American Depositary Shares that remain outstanding, and those Owners will be general creditors of the Depositary with respect to those net proceeds and that other cash.  After making that sale, the Depositary shall be discharged from all obligations under this Deposit Agreement, except (i) to account for the net proceeds and other cash (after deducting, in each case, the fee of the Depositary for the surrender of American Depositary Shares, any expenses for the account of the Owner of such American Depositary Shares in accordance with the terms and conditions of this Deposit Agreement and any applicable taxes or governmental charges) and to pay them to Owners upon surrender of American Depositary Shares in accordance with Section 2.5, (ii) for its obligations under Section 5.8 and (iii) to act as provided in paragraph (d) below.

 

(d)                                 After the Termination Date, if any American Depositary Shares shall remain outstanding, the Depositary shall continue to receive dividends and other distributions pertaining to Deposited Securities (that have not been sold), may sell rights and other property as provided in this Deposit Agreement and shall deliver Deposited Securities (or sale proceeds) upon surrender of American Depositary Shares (after payment or upon deduction, in each case, of the fee of the Depositary for the surrender of American Depositary Shares, any expenses for the account of the Owner of those American Depositary Shares in accordance with the terms and conditions of this Deposit Agreement and any applicable taxes or governmental charges).  After the Termination Date, the Depositary shall not accept deposits of Shares or deliver American Depositary Shares.  After the Termination Date, (i) the Depositary may refuse to accept surrenders of American Depositary Shares for the purpose of withdrawal of Deposited Securities (that have not been sold) if in its judgment the requested withdrawal would interfere with its efforts to sell the Deposited Securities, (ii) the Depositary will not be required to deliver cash proceeds of the sale of Deposited Securities until all Deposited Securities have been sold and (iii) the Depositary may discontinue the registration of transfers of American Depositary Shares and suspend the distribution of dividends and other distributions on Deposited Securities to the Owners and need not give any further notices or perform any further acts under this Deposit Agreement except as provided in this Section.

 

ARTICLE 7.                                                   MISCELLANEOUS

 

SECTION 7.1.                                          Counterparts; Signatures.

 

This Deposit Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of those counterparts shall constitute one and the same instrument.  Copies of this Deposit Agreement shall be filed with the Depositary and the Custodians and shall be open to inspection by any Owner or Holder during regular business hours.

 

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Any manual signature on this Deposit Agreement that is faxed, scanned or photocopied, and any electronic signature valid under the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. § 7001, et. seq., shall for all purposes have the same validity, legal effect and admissibility in evidence as an original manual signature, and the parties hereby waive any objection to the contrary.

 

SECTION 7.2.                                          No Third Party Beneficiaries.

 

This Deposit Agreement is for the exclusive benefit of the Company, the Depositary, the Owners and the Holders and their respective successors and shall not be deemed to give any legal or equitable right, remedy or claim whatsoever to any other person.

 

SECTION 7.3.                                          Severability.

 

In case any one or more of the provisions contained in this Deposit Agreement or in a Receipt should be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained in this Deposit Agreement or that Receipt shall in no way be affected, prejudiced or disturbed thereby.

 

SECTION 7.4.                                          Owners and Holders as Parties; Binding Effect.

 

The Owners and Holders from time to time shall be parties to this Deposit Agreement and shall be bound by all of the terms and conditions of this Deposit Agreement and of the Receipts by acceptance of American Depositary Shares or any interest therein.

 

SECTION 7.5.                                          Notices.

 

Any and all notices to be given to the Company shall be in writing and shall be deemed to have been duly given if personally delivered or sent by domestic first class or international air mail or air courier or sent by facsimile transmission or email attaching a pdf or similar bit-mapped image of a signed writing, provided that receipt of the facsimile transmission or email has been confirmed by the recipient, addressed to LexinFintech Holdings Ltd., 27/F CES Tower, No. 3099 Keyuan South Road, Nanshan District, Shenzhen 518052, The People’s Republic of China, or any other place to which the Company may have transferred its principal office with notice to the Depositary.

 

33

 

Any and all notices to be given to the Depositary shall be in writing and shall be deemed to have been duly given if in English and personally delivered or sent by first class domestic or international air mail or air courier or sent by facsimile transmission or email attaching a pdf or similar bit-mapped image of a signed writing, addressed to The Bank of New York Mellon, 101 Barclay Street, New York, New York 10286, Attention:  Depositary Receipt Administration, or any other place to which the Depositary may have transferred its Office with notice to the Company.

 

Delivery of a notice to the Company or Depositary by mail or air courier shall be deemed effected when deposited, postage prepaid, in a post-office letter box or received by an air courier service.  Delivery of a notice to the Company or Depositary sent by facsimile transmission or email shall be deemed effected when the recipient acknowledges receipt of that notice.

 

A notice to be given to an Owner shall be deemed to have been duly given when Disseminated to that Owner.  Dissemination in paper form will be effective when personally delivered or sent by first class domestic or international air mail or air courier, addressed to that Owner at the address of that Owner as it appears on the transfer books for American Depositary Shares of the Depositary, or, if that Owner has filed with the Depositary a written request that notices intended for that Owner be mailed to some other address, at the address designated in that request.  Dissemination in electronic form will be effective when sent in the manner consented to by the Owner to the electronic address most recently provided by the Owner for that purpose.

 

SECTION 7.6.                                          Arbitration; Settlement of Disputes.

 

Any controversy, claim or cause of action brought by any party hereto against the Company arising out of or relating to the Shares or other Deposited Securities, the American Depositary Shares, the Receipts or this Deposit Agreement, or the breach hereof or thereof, if so elected by the claimant, shall be settled by arbitration in accordance with the International Arbitration Rules of the American Arbitration Association, and judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof.

 

The place of the arbitration shall be The City of New York, State of New York, United States of America, and the language of the arbitration shall be English.

 

The number of arbitrators shall be three, each of whom shall be disinterested in the dispute or controversy, shall have no connection with any party thereto, and shall be an attorney experienced in international securities transactions. Each party shall appoint one arbitrator and the two arbitrators shall select a third arbitrator who shall serve as chairperson of the tribunal. If a dispute, controversy or cause of action shall involve more than two parties, the parties shall attempt to align themselves in two sides (i.e., claimant(s) and respondent(s)), each of which shall appoint one arbitrator as if there were only two parties to such dispute, controversy or cause of action. If such alignment and appointment shall not have occurred within thirty (30) calendar days after the initiating party serves the arbitration demand, the American Arbitration Association shall appoint the three arbitrators, each of whom shall have the qualifications described above. The parties and the American Arbitration Association may appoint from among the nationals of any country, whether or not a party is a national of that country.

 

34

 

The arbitral tribunal shall have no authority to award any consequential, special or punitive damages or other damages not measured by the prevailing party’s actual damages and may not, in any event, make any ruling, finding or award that does not conform to the terms and conditions of this Deposit Agreement.

 

SECTION 7.7.                                          Appointment of Agent for Service of Process; Submission to Jurisdiction; Jury Trial Waiver.

 

The Company hereby (i) designates and appoints the person named in Exhibit A to this Deposit Agreement, located in the State of New York, as the Company’s authorized agent upon which process may be served in any suit or proceeding (including any arbitration proceeding) arising out of or relating to the Shares or Deposited Securities, the American Depositary Shares, the Receipts or this Deposit Agreement (a “Proceeding”), (ii) consents and submits to the jurisdiction of any state or federal court in the State of New York in which any Proceeding may be instituted and (iii) agrees that service of process upon said authorized agent shall be deemed in every respect effective service of process upon the Company in any Proceeding.  The Company agrees to deliver to the Depositary, upon the execution and delivery of this Deposit Agreement, a written acceptance by the agent named in Exhibit A to this Deposit Agreement of its appointment as process agent.  The Company further agrees to take any and all action, including the filing of any and all such documents and instruments, as may be necessary to continue that designation and appointment in full force and effect, or to appoint and maintain the appointment of another process agent located in the United States as required above, and to deliver to the Depositary a written acceptance by that agent of that appointment, for so long as any American Depositary Shares or Receipts remain outstanding or this Deposit Agreement remains in force.  In the event the Company fails to maintain the designation and appointment of a process agent in the United States in full force and effect, the Company hereby waives personal service of process upon it and consents that a service of process in connection with a Proceeding may be made by certified or registered mail, return receipt requested, directed to the Company at its address last specified for notices under this Deposit Agreement, and service so made shall be deemed completed five (5) days after the same shall have been so mailed.

 

EACH PARTY TO THIS DEPOSIT AGREEMENT (INCLUDING, FOR AVOIDANCE OF DOUBT, EACH OWNER AND HOLDER) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING AGAINST THE COMPANY AND/OR THE DEPOSITARY DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THE SHARES OR OTHER DEPOSITED SECURITIES, THE AMERICAN DEPOSITARY SHARES OR THE RECEIPTS, THIS DEPOSIT AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREIN OR THEREIN, OR THE BREACH HEREOF OR THEREOF, INCLUDING, WITHOUT LIMITATION, ANY QUESTION REGARDING EXISTENCE, VALIDITY OR TERMINATION (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).

 

35

 

SECTION 7.8.                                          Waiver of Immunities.

 

To the extent that the Company or any of its properties, assets or revenues may have or may hereafter become entitled to, or have attributed to it, any right of immunity, on the grounds of sovereignty or otherwise, from any legal action, suit or proceeding, from the giving of any relief in any respect thereof, from setoff or counterclaim, from the jurisdiction of any court, from service of process, from attachment upon or prior to judgment, from attachment in aid of execution or judgment, or from execution of judgment, or other legal process or proceeding for the giving of any relief or for the enforcement of any judgment, in any jurisdiction in which proceedings may at any time be commenced, with respect to its obligations, liabilities or any other matter under or arising out of or in connection with the Shares or Deposited Securities, the American Depositary Shares, the Receipts or this Deposit Agreement, the Company, to the fullest extent permitted by law, hereby irrevocably and unconditionally waives, and agrees not to plead or claim, any immunity of that kind and consents to relief and enforcement as provided above.

 

SECTION 7.9.                                          Governing Law.

 

This Deposit Agreement and the Receipts shall be interpreted in accordance with and all rights hereunder and thereunder and provisions hereof and thereof shall be governed by the laws of the State of New York.

 

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IN WITNESS WHEREOF, LEXINFINTECH HOLDINGS LTD. and THE BANK OF NEW YORK MELLON have duly executed this Deposit Agreement as of the day and year first set forth above and all Owners and Holders shall become parties hereto upon acceptance by them of American Depositary Shares or any interest therein.

 

	
 
    	
LEXINFINTECH HOLDINGS   LTD.
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
THE BANK OF NEW YORK   MELLON,
    
	
 
    	
as Depositary
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    

 

37

 

EXHIBIT A

 

	
 
    	
AMERICAN DEPOSITARY   SHARES

(Each American   Depositary Share represents

             deposited Shares)
    

 

THE BANK OF NEW YORK MELLON

AMERICAN DEPOSITARY RECEIPT

FOR CLASS A ORDINARY SHARES OF

LEXINFINTECH HOLDINGS LTD.

(INCORPORATED UNDER THE LAWS OF THE CAYMAN ISLANDS)

 

The Bank of New York Mellon, as depositary (hereinafter called the “Depositary”), hereby certifies that                                         , or registered assigns IS THE OWNER OF                                     

 

AMERICAN DEPOSITARY SHARES

 

representing deposited Class A ordinary shares (herein called “Shares”) of LexinFintech Holdings Ltd., incorporated under the laws of the Cayman Islands (herein called the “Company”).  At the date hereof, each American Depositary Share represents        Shares deposited or subject to deposit under the Deposit Agreement (as such term is hereinafter defined) with a custodian for the Depositary (herein called the “Custodian”) that, as of the date of the Deposit Agreement, was The Hongkong and Shanghai Banking Corporation Limited located in Hong Kong.  The Depositary’s Office is located at a different address than its principal executive office.  Its Office is located at 101 Barclay Street, New York, N.Y. 10286, and its principal executive office is located at 225 Liberty Street, New York, N.Y. 10286.

 

THE DEPOSITARY’S OFFICE ADDRESS IS

101 BARCLAY STREET, NEW YORK, N.Y. 10286

 

1.                                      THE DEPOSIT AGREEMENT.

 

This American Depositary Receipt is one of an issue (herein called “Receipts”), all issued and to be issued upon the terms and conditions set forth in the Deposit Agreement dated as of           , 2017 (herein called the “Deposit Agreement”) among the Company, the Depositary, and all Owners and Holders from time to time of American Depositary Shares issued thereunder, each of whom by accepting American Depositary Shares agrees to become a party thereto and become bound by all the terms and conditions thereof.  The Deposit Agreement sets forth the rights of Owners and Holders and the rights and duties of the Depositary in respect of the Shares deposited thereunder and any and all other securities, property and cash from time to time received in respect of those Shares and held thereunder (those Shares, securities, property, and cash are herein called “Deposited Securities”).  Copies of the Deposit Agreement are on file at the Depositary’s Office in New York City and at the office of the Custodian.

 

A-1

 

The statements made on the face and reverse of this Receipt are summaries of certain provisions of the Deposit Agreement and are qualified by and subject to the detailed provisions of the Deposit Agreement, to which reference is hereby made.  Capitalized terms defined in the Deposit Agreement and not defined herein shall have the meanings set forth in the Deposit Agreement.

 

2.                                      SURRENDER OF AMERICAN DEPOSITARY SHARES AND WITHDRAWAL OF SHARES.

 

Upon surrender at the Depositary’s Office of American Depositary Shares for the purpose of withdrawal of the Deposited Securities represented thereby and payment of the fee of the Depositary for the surrender of American Depositary Shares as provided in Section 5.9 of the Deposit Agreement and payment of all taxes and governmental charges payable in connection with that surrender and withdrawal of the Deposited Securities, and subject to the terms and conditions of the Deposit Agreement, the Owner of those American Depositary Shares shall be entitled to delivery (to the extent delivery can then be lawfully and practicably made), to or as instructed by that Owner, of the amount of Deposited Securities at the time represented by those American Depositary Shares, but not any money or other property as to which a record date for distribution to Owners has passed (since money or other property of that kind will be delivered or paid on the scheduled payment date to the Owner as of that record date).  The Depositary shall direct the Custodian with respect to delivery of Deposited Securities and may charge the surrendering Owner a fee and its expenses for giving that direction by cable (including SWIFT) or facsimile transmission.  That delivery will be made, at the office of the Custodian, except that, at the request, risk and expense of the surrendering Owner, and for the account of that Owner, the Depositary shall direct the Custodian to forward any cash or other property comprising, and forward a certificate or certificates, if applicable, and other proper documents of title, if any, for, the Deposited Securities represented by the surrendered American Depositary Shares to the Depositary for delivery at the Depositary’s Office or to another address specified in the order received from the surrendering Owner.

 

3.                                      REGISTRATION OF TRANSFER OF AMERICAN DEPOSITARY SHARES; COMBINATION AND SPLIT-UP OF RECEIPTS; INTERCHANGE OF CERTIFICATED AND UNCERTIFICATED AMERICAN DEPOSITARY SHARES.

 

The Depositary, subject to the terms and conditions of the Deposit Agreement, shall register a transfer of American Depositary Shares on its transfer books upon (i) in the case of certificated American Depositary Shares, surrender of the Receipt evidencing those American Depositary Shares, by the Owner or by a duly authorized attorney, properly endorsed or accompanied by proper instruments of transfer or (ii) in the case of uncertificated American Depositary Shares, receipt from the Owner of a proper instruction (including, for the avoidance of doubt, instructions through DRS and Profile as provided in Section 2.10 of that Agreement), and, in either case, duly stamped as may be required by the laws of the State of New York and of the United States of America. Upon registration of a transfer, the Depositary shall deliver the transferred American Depositary Shares to or upon the order of the person entitled thereto.

 

A-2

 

The Depositary, subject to the terms and conditions of the Deposit Agreement, shall upon surrender of a Receipt or Receipts for the purpose of effecting a split-up or combination of such Receipt or Receipts, execute and deliver a new Receipt or Receipts for any authorized number of American Depositary Shares requested, evidencing the same aggregate number of American Depositary Shares as the Receipt or Receipts surrendered.

 

The Depositary, upon surrender of certificated American Depositary Shares for the purpose of exchanging for uncertificated American Depositary Shares, shall cancel the Receipt evidencing those certificated American Depositary Shares and send the Owner a statement confirming that the Owner is the owner of the same number of uncertificated American Depositary Shares.  The Depositary, upon receipt of a proper instruction (including, for the avoidance of doubt, instructions through DRS and Profile as provided in Section 2.10 of the Deposit Agreement) from the Owner of uncertificated American Depositary Shares for the purpose of exchanging for certificated American Depositary Shares, shall cancel those uncertificated American Depositary Shares and register and deliver to the Owner a Receipt evidencing the same number of certificated American Depositary Shares.

 

As a condition precedent to the delivery, registration of transfer, or surrender of any American Depositary Shares or split-up or combination of any Receipt or withdrawal of any Deposited Securities, the Depositary, the Custodian, or Registrar may require payment from the depositor of the Shares or the presenter of the Receipt or instruction for registration of transfer or surrender of American Depositary Shares not evidenced by a Receipt of a sum sufficient to reimburse it for any tax or other governmental charge and any stock transfer or registration fee with respect thereto (including any such tax or charge and fee with respect to Shares being deposited or withdrawn) and payment of any applicable fees as provided in the Deposit Agreement, may require the production of proof satisfactory to it as to the identity and genuineness of any signature and may also require compliance with any regulations the Depositary may establish consistent with the provisions of the Deposit Agreement.

 

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The delivery of American Depositary Shares against deposit of Shares generally or against deposit of particular Shares may be suspended, or the registration of transfer of American Depositary Shares in particular instances may be refused, or the registration of transfer of outstanding American Depositary Shares generally may be suspended, during any period when the transfer books of the Depositary are closed, or if any such action is deemed necessary or advisable by the Depositary or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission, or under any provision of the Deposit Agreement, or for any other reason.  Notwithstanding anything to the contrary in the Deposit Agreement or this Receipt, the surrender of outstanding American Depositary Shares and withdrawal of Deposited Securities may not be suspended subject only to (i) temporary delays caused by closing the transfer books of the Depositary or the Company or the Foreign Registrar, if applicable, or the deposit of Shares in connection with voting at a shareholders’ meeting, or the payment of dividends, (ii) the payment of fees, taxes and similar charges, and (iii) compliance with any U.S. or foreign laws or governmental regulations relating to the American Depositary Shares or to the withdrawal of the Deposited Securities.  The Depositary shall not knowingly accept for deposit under the Deposit Agreement any Shares that, at the time of deposit, are Restricted Securities.

 

4.                                      LIABILITY OF OWNER FOR TAXES.

 

If any tax or other governmental charge shall become payable by the Custodian or the Depositary with respect to or in connection with any American Depositary Shares or any Deposited Securities represented by any American Depositary Shares or in connection with a transaction to which Section 4.8 of the Deposit Agreement applies, that tax or other governmental charge shall be payable by the Owner of those American Depositary Shares to the Depositary.  The Depositary may refuse to register any transfer of those American Depositary Shares or any withdrawal of Deposited Securities represented by those American Depositary Shares until that payment is made, and may withhold any dividends or other distributions or the proceeds thereof, or may sell for the account of the Owner any part or all of the Deposited Securities represented by those American Depositary Shares, and may apply those dividends or other distributions or the net proceeds of any sale of that kind in payment of that tax or other governmental charge but, even after a sale of that kind, the Owner shall remain liable for any deficiency.  The Depositary shall distribute any net proceeds of a sale made under Section 3.2 of the Deposit Agreement that are not used to pay taxes or governmental charges to the Owners entitled to them in accordance with Section 4.1 of the Deposit Agreement.  If the number of Shares represented by each American Depositary Share decreases as a result of a sale of Deposited Securities under Section 3.2 of the Deposit Agreement, the Depositary may call for surrender of the American Depositary Shares to be exchanged on a mandatory basis for a lesser number of American Depositary Shares and may sell American Depositary Shares to the extent necessary to avoid distributing fractions of American Depositary Shares in that exchange and distribute the net proceeds of that sale to the Owners entitled to them.

 

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5.                                      WARRANTIES ON DEPOSIT OF SHARES.

 

Every person depositing Shares under the Deposit Agreement shall be deemed thereby to represent and warrant that those Shares and each certificate therefor, if applicable, are validly issued, fully paid and nonassessable and were not issued in violation of any preemptive or similar rights of the holders of outstanding securities of the Company and that the person making that deposit is duly authorized so to do.  Every depositing person shall also be deemed to represent that the Shares, at the time of deposit, are not Restricted Securities.  All representations and warranties deemed made under Section 3.3 of the Deposit Agreement shall survive the deposit of Shares and delivery of American Depositary Shares.

 

6.                                      FILING PROOFS, CERTIFICATES, AND OTHER INFORMATION.

 

Any person presenting Shares for deposit or any Owner or Holder may be required from time to time to file with the Depositary or the Custodian such proof of citizenship or residence, exchange control approval, or such information relating to the registration on the books of the Company or the Foreign Registrar, if applicable, to execute such certificates and to make such representations and warranties, as the Depositary may deem necessary or proper.  The Depositary may withhold the delivery or registration of transfer of any American Depositary Shares, the distribution of any dividend or other distribution or of the proceeds thereof or the delivery of any Deposited Securities until that proof or other information is filed or those certificates are executed or those representations and warranties are made.

 

As conditions of accepting Shares for deposit, the Depositary may require (i) any certification required by the Depositary or the Custodian in accordance with the provisions of the Deposit Agreement, (ii) a written order directing the Depositary to deliver to, or upon the written order of, the person or persons stated in that order, the number of American Depositary Shares representing those Deposited Shares, (iii) evidence satisfactory to the Depositary that those Shares have been re-registered in the books of the Company or the Foreign Registrar in the name of the Depositary, a Custodian or a nominee of the Depositary or a Custodian, (iv) evidence satisfactory to the Depositary that any necessary approval for the transfer or deposit has been granted by any governmental body in each applicable jurisdiction and (v) an agreement or assignment, or other instrument satisfactory to the Depositary, that provides for the prompt transfer to the Custodian of any dividend, or right to subscribe for additional Shares or to receive other property, that any person in whose name those Shares are or have been recorded may thereafter receive upon or in respect of those Shares, or, in lieu thereof, such agreement of indemnity or other agreement as shall be satisfactory to the Depositary.  The Depositary shall refuse, and shall instruct the Custodian to refuse, to accept Shares for deposit if the Depositary has received a notice from the Company that the Company has restricted transfer of those Shares under the Company’s articles of association or any applicable laws or that the deposit would result in any violation of the Company’s articles of association or any applicable laws.

 

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7.                                      CHARGES OF DEPOSITARY.

 

The following charges shall be incurred by any party depositing or withdrawing Shares or by any party surrendering American Depositary Shares or to whom American Depositary Shares are issued (including, without limitation, issuance pursuant to a stock dividend or stock split declared by the Company or an exchange of stock regarding the American Depositary Shares or Deposited Securities or a delivery of American Depositary Shares pursuant to Section 4.3 of the Deposit Agreement), or by Owners, as applicable:  (1) taxes and other governmental charges, (2) such registration fees as may from time to time be in effect for the registration of transfers of Shares generally on the Share register of the Company or Foreign Registrar and applicable to transfers of Shares to or from the name of the Depositary or its nominee or the Custodian or its nominee on the making of deposits or withdrawals hereunder, (3) such cable (including SWIFT) and facsimile transmission fees and expenses as are expressly provided in the Deposit Agreement, (4) such expenses as are incurred by the Depositary in the conversion of foreign currency pursuant to Section 4.5 of the Deposit Agreement, (5) a fee of $5.00 or less per 100 American Depositary Shares (or portion thereof) for the delivery of American Depositary Shares pursuant to Section 2.3, 4.3 or 4.4 of the Deposit Agreement and the surrender of American Depositary Shares pursuant to Section 2.5 or 6.2 of the Deposit Agreement, (6) a fee of $.05 or less per American Depositary Share (or portion thereof) for any cash distribution made pursuant to the Deposit Agreement, including, but not limited to Sections 4.1 through 4.4 and 4.8 of the Deposit Agreement, (7) a fee for the distribution of securities pursuant to Section 4.2 of the Deposit Agreement or of rights pursuant to Section 4.4 of that Agreement (where the Depositary will not exercise or sell those rights on behalf of Owners), such fee being in an amount equal to the fee for the execution and delivery of American Depositary Shares referred to above which would have been charged as a result of the deposit of such securities under the Deposit Agreement (for purposes of this item 7 treating all such securities as if they were Shares) but which securities are instead distributed by the Depositary to Owners, (8) in addition to any fee charged under item 6, a fee of $.05 or less per American Depositary Share (or portion thereof) per annum for depositary services, which will be payable as provided in item 9 below, and (9) any other charges payable by the Depositary or the Custodian, any of the Depositary’s or Custodian’s agents or the agents of the Depositary’s or Custodian’s agents, in connection with the servicing of Shares or other Deposited Securities (which charges shall be assessed against Owners as of the date or dates set by the Depositary in accordance with Section 4.6 of the Deposit Agreement and shall be payable at the sole discretion of the Depositary by billing those Owners for those charges or by deducting those charges from one or more cash dividends or other cash distributions).

 

The Depositary may collect any of its fees by deduction from any cash distribution payable, or by selling a portion of any securities to be distributed, to Owners that are obligated to pay those fees.

 

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The Depositary, subject to Article 8 hereof, may own and deal in any class of securities of the Company and its affiliates and in American Depositary Shares.

 

From time to time, the Depositary may make payments to the Company to reimburse the Company for costs and expenses generally arising out of establishment and maintenance of the American Depositary Shares program, waive fees and expenses for services provided by the Depositary or share revenue from the fees collected from Owners or Holders.  In performing its duties under the Deposit Agreement, the Depositary may use brokers, dealers, foreign currency dealers or other service providers that are owned by or affiliated with the Depositary and that may earn or share fees, spreads or commissions.

 

8.                                      PRE-RELEASE OF AMERICAN DEPOSITARY SHARES.

 

Notwithstanding Section 2.3 of the Deposit Agreement, the Depositary may deliver American Depositary Shares prior to the receipt of Shares pursuant to Section 2.2 of the Deposit Agreement (a “Pre-Release”).  The Depositary may, pursuant to Section 2.5 of the Deposit Agreement, deliver Shares upon the surrender of American Depositary Shares that have been Pre-Released, whether or not that surrender is prior to the termination of that Pre-Release or the Depositary knows that those American Depositary Shares have been Pre-Released.  The Depositary may receive American Depositary Shares in lieu of Shares in satisfaction of a Pre-Release.  Each Pre-Release must be (a) preceded or accompanied by a written representation from the person to whom American Depositary Shares or Shares are to be delivered, that such person, or its customer, owns the Shares or American Depositary Shares to be remitted, as the case may be, (b) at all times fully collateralized with cash or such other collateral as the Depositary deems appropriate, (c) terminable by the Depositary on not more than five (5) business days’ notice, and (d) subject to all indemnities and credit regulations that the Depositary deems appropriate.  The number of American Depositary Shares outstanding at any time as a result of Pre-Release will not normally exceed thirty percent (30%) of all American Depositary Shares outstanding; provided, however, that the Depositary reserves the right to change or disregard that limit from time to time as it deems appropriate.

 

The Depositary may retain for its own account any compensation received by it in connection with Pre-Release.

 

9.                                      TITLE TO AMERICAN DEPOSITARY SHARES.

 

It is a condition of the American Depositary Shares, and every successive Owner and Holder of American Depositary Shares, by accepting or holding the same, consents and agrees that American Depositary Shares evidenced by a Receipt, when the Receipt is properly endorsed or accompanied by proper instruments of transfer, shall be transferable as certificated registered securities under the laws of the State of New York, and that American Depositary Shares not evidenced by Receipts shall be transferable as uncertificated registered securities under the laws of the State of New York.  The Depositary, notwithstanding any notice to the contrary, may treat the Owner of American Depositary Shares as the absolute owner thereof for the purpose of determining the person entitled to distribution of dividends or other distributions or to any notice provided for in the Deposit Agreement and for all other purposes, and neither the Depositary nor the Company shall have any obligation or be subject to any liability under the Deposit Agreement to any Holder of American Depositary Shares, but only to the Owner.

 

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10.                               VALIDITY OF RECEIPT.

 

This Receipt shall not be entitled to any benefits under the Deposit Agreement or be valid or obligatory for any purpose, unless this Receipt shall have been (i) executed by the Depositary by the manual signature of a duly authorized officer of the Depositary or (ii) executed by the facsimile signature of a duly authorized officer of the Depositary and countersigned by the manual signature of a duly authorized signatory of the Depositary or the Registrar or a co-registrar.

 

11.                               REPORTS; INSPECTION OF TRANSFER BOOKS.

 

The Company is subject to the periodic reporting requirements of the Securities Exchange Act of 1934 and, accordingly, files certain reports with the Securities and Exchange Commission. Those reports will be available for inspection and copying through the Commission’s EDGAR system or at public reference facilities maintained by the Commission in Washington, D.C.

 

The Depositary will make available for inspection by Owners at its Office any reports, notices and other communications, including any proxy soliciting material, received from the Company which are both (a) received by the Depositary as the holder of the Deposited Securities and (b) made generally available to the holders of those Deposited Securities by the Company.  The Company shall furnish reports and communications, including any proxy soliciting material to which Section 4.9 of the Deposit Agreement applies, to the Depositary in English, to the extent such materials are required to be translated into English pursuant to any regulations of the Commission.

 

The Depositary will keep books for the registration of American Depositary Shares and transfers of American Depositary Shares, which shall be open for inspection by the Owners at the Depositary’s Office during regular business hours, provided that such inspection shall not be for the purpose of communicating with Owners in the interest of a business or object other than the business of the Company or a matter related to the Deposit Agreement or the American Depositary Shares.

 

12.                               DIVIDENDS AND DISTRIBUTIONS.

 

Whenever the Depositary receives any cash dividend or other cash distribution on Deposited Securities, the Depositary will, if at the time of receipt thereof any amounts received in a foreign currency can in the judgment of the Depositary be converted on a reasonable basis into Dollars transferable to the United States, and subject to the Deposit Agreement, as promptly as practicable, convert that dividend or other cash distribution into Dollars and distribute the amount thus received (net of the fees and expenses of the Depositary as provided in Article 7 hereof and Section 5.9 of the Deposit Agreement) to the Owners entitled thereto; provided, however, that if the Custodian or the Depositary is required to withhold and does withhold from that cash dividend or other cash distribution an amount on account of taxes or other governmental charges, the amount distributed to the Owners of the American Depositary Shares representing those Deposited Securities shall be reduced accordingly.  If a cash distribution would represent a return of all or substantially all the value of the Deposited Securities underlying American Depositary Shares, the Depositary may require surrender of those American Depositary Shares and may require payment of or deduct the fee for surrender of American Depositary Shares (whether or not it is also requiring surrender of American Depositary Shares) as a condition of making that cash distribution.  A distribution of that kind shall be a Termination Option Event.

 

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Subject to the provisions of Section 4.11 and 5.9 of the Deposit Agreement, whenever the Depositary receives any distribution other than a distribution described in Section 4.1, 4.3 or 4.4 of the Deposit Agreement on Deposited Securities (but not in exchange for or in conversion or in lieu of Deposited Securities), the Depositary will cause the securities or property received by it to be distributed to the Owners entitled thereto, after deduction or upon payment of any fees and expenses of the Depositary and any taxes or other governmental charges, in any manner that the Depositary deems equitable and practicable for accomplishing that distribution (which may be a distribution of depositary shares representing the securities received); provided, however, that if in the opinion of the Depositary such distribution cannot be made proportionately among the Owners of Receipts entitled thereto, or if for any other reason the Depositary deems such distribution not to be lawful and feasible, the Depositary may adopt such other method as it may deem equitable and practicable for the purpose of effecting such distribution, including, but not limited to, the public or private sale of the securities or property thus received, or any part thereof, and distribution of the net proceeds of any such sale (net of the fees and expenses of the Depositary as provided in Article 7 hereof and Section 5.9 of the Deposit Agreement) to the Owners entitled thereto all in the manner and subject to the conditions set forth in Section 4.1 of the Deposit Agreement.  The Depositary may withhold any distribution of securities under Section 4.2 of the Deposit Agreement if it has not received satisfactory assurances from the Company that the distribution does not require registration under the Securities Act of 1933.  The Depositary may sell, by public or private sale, an amount of securities or other property it would otherwise distribute under this Article that is sufficient to pay its fees and expenses in respect of that distribution.  If a distribution under Section 4.2 of the Deposit Agreement would represent a return of all of substantially all the value of the Deposited Securities underlying American Depositary Shares, the Depositary may require surrender of those American Depositary Shares and may require payment of or deduct the fee for surrender of American Depositary Shares (whether or not it is also requiring surrender of American Depositary Shares) as a condition of making that distribution.  A distribution of that kind shall be a Termination Option Event.

 

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Whenever the Depositary receives any distribution consisting of a dividend in, or free distribution of, Shares, the Depositary may deliver to the Owners entitled thereto, an aggregate number of American Depositary Shares representing the amount of Shares received as that dividend or free distribution, subject to the terms and conditions of the Deposit Agreement with respect to the deposit of Shares and issuance of American Depositary Shares, including the withholding of any tax or other governmental charge as provided in Section 4.11 of the Deposit Agreement and the payment of the fees and expenses of the Depositary as provided in Article 7 hereof and Section 5.9 of the Deposit Agreement (and the Depositary may sell, by public or private sale, an amount of Shares received (or American Depositary Shares representing those Shares) sufficient to pay its fees and expenses in respect of that  distribution).  In lieu of delivering fractional American Depositary Shares, the Depositary may sell the amount of Shares represented by the aggregate of those fractions (or American Depositary Shares representing those Shares) and distribute the net proceeds, all in the manner and subject to the conditions described in Section 4.1 of the Deposit Agreement.  If and to the extent that additional American Depositary Shares are not delivered and Shares or American Depositary Shares are not sold, each American Depositary Share shall thenceforth also represent the additional Shares distributed on the Deposited Securities represented thereby.

 

If the Company declares a distribution in which holders of Deposited Securities have a right to elect whether to receive cash, Shares or other securities or a combination of those things, or a right to elect to have a distribution sold on their behalf, the Depositary may, after consultation with the Company, make that right of election available for exercise by Owners any manner the Depositary considers to be lawful and practical.  As a condition of making a distribution election right available to Owners, the Depositary may require satisfactory assurances from the Company that doing so does not require registration of any securities under the Securities Act of 1933.

 

If the Depositary determines that any distribution received or to be made by the Depositary (including Shares and rights to subscribe therefor) is subject to any tax or other governmental charge that the Depositary is obligated to withhold, the Depositary may sell, by public or private sale, all or a portion of the distributed property (including Shares and rights to subscribe therefor) in the amounts and manner the Depositary deems necessary and practicable to pay any those taxes or charges, and the Depositary shall distribute the net proceeds of that sale, after deduction of those taxes or charges, to the Owners entitled thereto in proportion to the number of American Depositary Shares held by them respectively.

 

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Each Owner and Holder agrees to indemnify the Company, the Depositary, the Custodian and their respective directors, employees, agents and affiliates for, and hold each of them harmless against, any claim by any governmental authority with respect to taxes, additions to tax, penalties or interest arising out of any refund of taxes, reduced withholding at source or other tax benefit received by it.  Services for Owners and Holders that may permit them to obtain reduced rates of tax withholding at source or reclaim excess tax withheld, and the fees and costs associated with using services of that kind, are not provided under, and are outside the scope of, the Deposit Agreement.

 

13.                               RIGHTS.

 

(a)                                 If rights are granted to the Depositary in respect of deposited Shares to purchase additional Shares or other securities, the Company and the Depositary shall endeavor to consult as to the actions, if any, the Depositary should take in connection with that grant of rights.  The Depositary may, to the extent deemed by it to be lawful and practical (i) if requested in writing by the Company, grant to all or certain Owners rights to instruct the Depositary to purchase the securities to which the rights relate and deliver those securities or American Depositary Shares representing those securities to Owners, (ii) if requested in writing by the Company, deliver the rights to or to the order of certain Owners, or (iii) sell the rights to the extent practicable and distribute the net proceeds of that sale to Owners entitled to those proceeds.  To the extent rights are not exercised, delivered or disposed of under (i), (ii) or (iii) above, the Depositary shall permit the rights to lapse unexercised.

 

(b)                                 If the Depositary will act under (a)(i) above, the Company and the Depositary will enter into a separate agreement setting forth the conditions and procedures applicable to the particular offering.  Upon instruction from an applicable Owner in the form the Depositary specified and upon payment by that Owner to the Depositary of an amount equal to the purchase price of the securities to be received upon the exercise of the rights, the Depositary shall, on behalf of that Owner, exercise the rights and purchase the securities.  The purchased securities shall be delivered to, or as instructed by, the Depositary.  The Depositary shall (i) deposit the purchased Shares under the Deposit Agreement and deliver American Depositary Shares representing those Shares to that Owner or (ii) deliver or cause the purchased Shares or other securities to be delivered to or to the order of that Owner.  The Depositary will not act under (a)(i) above unless the offer and sale of the securities to which the rights relate are registered under the Securities Act of 1933 or the Depositary has received an opinion of United States counsel that is satisfactory to it to the effect that those securities may be sold and delivered to the applicable Owners without registration under the Securities Act of 1933.

 

(c)                                  If the Depositary will act under (a)(ii) above, the Company and the Depositary will enter into a separate agreement setting forth the conditions and procedures applicable to the particular offering.  Upon (i) the request of an applicable Owner to deliver the rights allocable to the American Depositary Shares of that Owner to an account specified by that Owner to which the rights can be delivered and (ii) receipt of such documents as the Company and the Depositary agreed to require to comply with applicable law, the Depositary will deliver those rights as requested by that Owner.

 

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(d)                                 If the Depositary will act under (a)(iii) above, the Depositary will use reasonable efforts to sell the rights in proportion to the number of American Depositary Shares held by the applicable Owners and pay the net proceeds to the Owners otherwise entitled to the rights that were sold, upon an averaged or other practical basis without regard to any distinctions among such Owners because of exchange restrictions or the date of delivery of any American Depositary Shares or otherwise.

 

(e)                                  Payment or deduction of the fees of the Depositary as provided in Section 5.9 of the Deposit Agreement and payment or deduction of the expenses of the Depositary and any applicable taxes or other governmental charges shall be conditions of any delivery of securities or payment of cash proceeds under Section 4.4 of that Agreement.

 

(f)                                   The Depositary shall not be responsible for any failure to determine that it may be lawful or feasible to make rights available to or exercise rights on behalf of Owners in general or any Owner in particular , or to sell rights.

 

14.                               CONVERSION OF FOREIGN CURRENCY.

 

Whenever the Depositary or the Custodian receives foreign currency, by way of dividends or other distributions or the net proceeds from the sale of securities, property or rights, and if at the time of the receipt thereof the foreign currency so received can in the judgment of the Depositary be converted on a reasonable basis into Dollars and the resulting Dollars transferred to the United States, the Depositary shall convert or cause to be converted by sale or in any other manner that it may determine that foreign currency into Dollars, and those Dollars shall be distributed to the Owners entitled thereto.  A cash distribution may be made upon an averaged or other practicable basis without regard to any distinctions among Owners based on exchange restrictions, the date of delivery of any American Depositary Shares or otherwise and shall be net of any expenses of conversion into Dollars incurred by the Depositary as provided in Section 5.9 of the Deposit Agreement.

 

If a conversion of foreign currency or the repatriation or distribution of Dollars can be effected only with the approval or license of any government or agency thereof, the Depositary may, but will not be required to, file an application for that approval or license.

 

If the Depositary determines that in its judgment any foreign currency received by the Depositary or the Custodian is not convertible on a reasonable basis into Dollars transferable to the United States, or if any approval or license of any government or agency thereof that is required for such conversion is not filed or sought by the Depositary or is not obtained within a reasonable period as determined by the Depositary, the Depositary may distribute the foreign currency received by the Depositary to, or in its discretion may hold such foreign currency uninvested and without liability for interest thereon for the respective accounts of, the Owners entitled to receive the same.

 

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If any conversion of foreign currency, in whole or in part, cannot be effected for distribution to some of the Owners entitled thereto, the Depositary may in its discretion make that conversion and distribution in Dollars to the extent practicable and permissible to the Owners entitled thereto and may distribute the balance of the foreign currency received by the Depositary to, or hold that balance uninvested and without liability for interest thereon for the account of, the Owners entitled thereto.

 

The Depositary may convert currency itself or through any of its affiliates and, in those cases, acts as principal for its own account and not as agent, advisor, broker or fiduciary on behalf of any other person and earns revenue, including, without limitation, transaction spreads, that it will retain for its own account.  The revenue is based on, among other things, the difference between the exchange rate assigned to the currency conversion made under the Deposit Agreement and the rate that the Depositary or its affiliate receives when buying or selling foreign currency for its own account.  The Depositary makes no representation that the exchange rate used or obtained in any currency conversion under the Deposit Agreement will be the most favorable rate that could be obtained at the time or that the method by which that rate will be determined will be the most favorable to Owners, subject to the Depositary’s obligations under Section 5.3 of that Agreement.  The methodology used to determine exchange rates used in currency conversions is available upon request.

 

15.                               RECORD DATES.

 

Whenever a cash dividend, cash distribution or any other distribution is made on Deposited Securities or rights to purchase Shares or other securities are issued with respect to Deposited Securities (which rights will be delivered to or exercised or sold on behalf of Owners in accordance with Section 4.4 of the Deposit Agreement) or the Depositary receives notice that a distribution or issuance of that kind will be made, or whenever the Depositary receives notice that a meeting of holders of Shares will be held in respect of which the Company has requested the Depositary to send a notice under Section 4.7 of the Deposit Agreement, or whenever the Depositary will assess a fee or charge against the Owners, or whenever the Depositary causes a change in the number of Shares that are represented by each American Depositary Share, or whenever the Depositary otherwise finds it necessary or convenient, the Depositary shall fix a record date, which shall be the same as, or as near as practicable to, any corresponding record date set by the Company with respect to Shares, (a) for the determination of the Owners (i) who shall be entitled to receive the benefit of that dividend or other distribution or those rights, (ii) who shall be entitled to give instructions for the exercise of voting rights at that meeting, (iii) who shall be responsible for that fee or charge or (iv) for any other purpose for which the record date was set, or (b) on or after which each American Depositary Share will represent the changed number of Shares.  Subject to the provisions of Sections 4.1 through 4.5 of the Deposit Agreement and to the other terms and conditions of the Deposit Agreement, the Owners on a record date fixed by the Depositary shall be entitled to receive the amount distributable by the Depositary with respect to that dividend or other distribution or those rights or the net proceeds of sale thereof in proportion to the number of American Depositary Shares held by them respectively, to give voting instructions or to act in respect of the other matter for which that record date was fixed, or be responsible for that fee or charge, as the case may be.

 

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16.                               VOTING OF DEPOSITED SHARES.

 

(a)                                 Upon receipt of notice of any meeting of holders of Shares at which holders of Shares will be entitled to vote, if requested in writing by the Company, the Depositary shall, as soon as practicable thereafter, Disseminate to the Owners a notice, the form of which shall be in the sole discretion of the Depositary, that shall contain (i) the information contained in the notice of meeting received by the Depositary, (ii) a statement that the Owners as of the close of business on a specified record date will be entitled, subject to any applicable provision of Cayman Islands law and of the articles of association or similar documents of the Company, to instruct the Depositary as to the exercise of the voting rights pertaining to the amount of Shares represented by their respective American Depositary Shares, (iii) a statement as to the manner in which those instructions may be given, including an express indication that instructions may be given or deemed given in accordance with the last sentence of paragraph (b) below if no instruction is received, to the Depositary to give a discretionary proxy to a person designated by the Company, and (iv) the last date on which the Depositary will accept instructions (the “Instruction Cutoff Date”).

 

(b)                                 Upon the written request of an Owner of American Depositary Shares, as of the date of the request or, if a record date was specified by the Depositary, as of that record date, received on or before any Instruction Cutoff Date established by the Depositary, the Depositary may, and if the Depositary sent a notice under the preceding paragraph shall, endeavor, in so far as practicable, to vote or cause to be voted the amount of deposited Shares represented by those American Depositary Shares in accordance with the instructions set forth in that request.  The Depositary shall not vote or attempt to exercise the right to vote that attaches to the deposited Shares other than in accordance with instructions given by Owners and received by the Depositary or as provided in the following sentence. If (i) the Company instructed the Depositary to Disseminate a notice under paragraph (a) above and complied with paragraph (d) below and (ii) no instructions are received by the Depositary from an Owner with respect to a matter and an amount of American Depositary Shares of that Owner on or before the Instruction Cutoff Date, the Depositary shall deem that Owner to have instructed the Depositary to give a discretionary proxy to a person designated by the Company with respect to that matter and the amount of deposited Shares represented by that amount of American Depositary Shares and the Depositary shall give a discretionary proxy to a person designated by the Company to vote that amount of deposited Shares as to that matter, except that no instruction of that kind shall be deemed given and no discretionary proxy shall be given with respect to any matter as to which the Company informs the Depositary (and the Company agrees to provide such information as promptly as practicable in writing, if applicable) that (x) the Company does not wish a proxy given, (y) substantial opposition exists or (z) the matter materially and adversely affects the rights of holders of Shares.

 

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(c)                                  There can be no assurance that Owners generally or any Owner in particular will receive the notice described in paragraph (a) above in time to enable Owners to give instructions to the Depositary prior to the Instruction Cutoff Date.

 

(d)                                 In order to give Owners a reasonable opportunity to instruct the Depositary as to the exercise of voting rights relating to Shares, if the Company will request the Depositary to Disseminate a notice under paragraph (a) above, the Company shall give the Depositary notice of the meeting, details concerning the matters to be voted upon and copies of materials to be made available to holders of Shares in connection with the meeting not less than 30 days prior to the meeting date.

 

17.                               TENDER AND EXCHANGE OFFERS; REDEMPTION, REPLACEMENT OR CANCELLATION OF DEPOSITED SECURITIES.

 

(a)                                 The Depositary shall not tender any Deposited Securities in response to any voluntary cash tender offer, exchange offer or similar offer made to holders of Deposited Securities (a “Voluntary Offer”), except when instructed in writing to do so by an Owner surrendering American Depositary Shares and subject to any conditions or procedures the Depositary may require.

 

(b)                                 If the Depositary receives a written notice that Deposited Securities have been redeemed for cash or otherwise purchased for cash in a transaction that is mandatory and binding on the Depositary as a holder of those Deposited Securities (a “Redemption”), the Depositary, at the expense of the Company, shall (i) if required, surrender Deposited Securities that have been redeemed to the issuer of those securities or its agent on the redemption date, (ii) Disseminate a notice to Owners (A) notifying them of that Redemption, (B) calling for surrender of a corresponding number of American Depositary Shares and (C) notifying them that the called American Depositary Shares have been converted into a right only to receive the money received by the Depositary upon that Redemption and those net proceeds shall be the Deposited Securities to which Owners of those converted American Depositary Shares shall be entitled upon surrenders of those American Depositary Shares in accordance with Section 2.5 or 6.2 of the Deposit Agreement and (iii) distribute the money received upon that Redemption to the Owners entitled to it upon surrender by them of called American Depositary Shares in accordance with Section 2.5 of that Agreement (and, for the avoidance of doubt, Owners shall not be entitled to receive that money under Section 4.1 of that Agreement).  If the Redemption affects less than all the Deposited Securities, the Depositary shall call for surrender a corresponding portion of the outstanding American Depositary Shares and only those American Depositary Shares will automatically be converted into a right to receive the net proceeds of the Redemption.  The Depositary shall allocate the American Depositary Shares converted under the preceding sentence among the Owners pro-rata to their respective holdings of American Depositary Shares immediately prior to the Redemption, except that the allocations may be adjusted so that no fraction of a converted American Depositary Share is allocated to any Owner.  A Redemption of all or substantially all of the Deposited Securities shall be a Termination Option Event.

 

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(c)                                  If the Depositary is notified of or there occurs any change in nominal value or any subdivision, combination or any other reclassification of the Deposited Securities or any recapitalization, reorganization, sale of assets substantially as an entirety, merger or consolidation affecting the issuer of the Deposited Securities or to which it is a party that is mandatory and binding on the Depositary as a holder of Deposited Securities and, as a result, securities or other property have been or will be delivered in exchange, conversion, replacement or in lieu of, Deposited Securities (a “Replacement”), the Depositary shall, if required, surrender the old Deposited Securities affected by that Replacement of Shares and hold, as new Deposited Securities under the Deposit Agreement, the new securities or other property delivered to it in that Replacement.  However, the Depositary may elect to sell those new Deposited Securities if in the opinion of the Depositary it is not lawful or not practical for it to hold those new Deposited Securities under the Deposit Agreement because those new Deposited Securities may not be distributed to Owners without registration under the Securities Act of 1933 or for any other reason, at public or private sale, at such places and on such terms as it deems proper and proceed as if those new Deposited Securities had been Redeemed under paragraph (b) above.  A Replacement shall be a Termination Option Event.

 

(d)                                 In the case of a Replacement where the new Deposited Securities will continue to be held under the Deposit Agreement, the Depositary may call for the surrender of outstanding Receipts to be exchanged for new Receipts specifically describing the new Deposited Securities and the number of those new Deposited Securities represented by each American Depositary Share.  If the number of Shares represented by each American Depositary Share decreases as a result of a Replacement, the Depositary may call for surrender of the American Depositary Shares to be exchanged on a mandatory basis for a lesser number of American Depositary Shares and may sell American Depositary Shares to the extent necessary to avoid distributing fractions of American Depositary Shares in that exchange and distribute the net proceeds of that sale to the Owners entitled to them.

 

(e)                                  If there are no Deposited Securities with respect to American Depositary Shares, including if the Deposited Securities are cancelled, or the Deposited Securities with respect to American Depositary Shares become apparently worthless, the Depositary may call for surrender of those American Depositary Shares or may cancel those American Depositary Shares, upon notice to Owners, and a Termination Option Event occurs.

 

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18.                               LIABILITY OF THE COMPANY AND DEPOSITARY.

 

Neither the Depositary nor the Company nor any of their respective directors, employees, agents or affiliates shall incur any liability to any Owner or Holder:

 

(i) if by reason of (A) any provision of any present or future law or regulation or other act of the government of the United States, any State of the United States or any other state or jurisdiction, or of any governmental or regulatory authority or stock exchange; (B) (in the case of the Depositary only) any provision, present or future, of the articles of association or similar document of the Company, or by reason of any provision of any securities issued or distributed by the Company, or any offering or distribution thereof; or (C) any event or circumstance, whether natural or caused by a person or persons, that is beyond the ability of the Depositary or the Company, as the case may be, to prevent or counteract by reasonable care or effort (including, but not limited to earthquakes, floods, severe storms, fires, explosions, war, terrorism, civil unrest, labor disputes or criminal acts; interruptions or malfunctions of utility services, Internet or other communications lines or systems; unauthorized access to or attacks on computer systems or websites; or other failures or malfunctions of computer hardware or software or other systems or equipment), the Depositary or the Company is, directly or indirectly, prevented from, forbidden to or delayed in, or could be subject to any civil or criminal penalty on account of doing or performing and therefore does not do or perform, any act or thing that, by the terms of the Deposit Agreement or the Deposited Securities, it is provided shall be done or performed;

 

(ii) for any exercise of, or failure to exercise, any discretion provided for in the Deposit Agreement (including any determination by the Depositary to take, or not take, any action that the Deposit Agreement provides the Depositary may take);

 

(iii) for the inability of any Owner or Holder to benefit from any distribution, offering, right or other benefit that is made available to holders of Deposited Securities but is not, under the terms of the Deposit Agreement, made available to Owners or Holders; or

 

(iv) for any special, consequential or punitive damages for any breach of the terms of the Deposit Agreement.

 

Where, by the terms of a distribution to which Section 4.1, 4.2 or 4.3 of the Deposit Agreement applies, or an offering to which Section 4.4 of that Agreement applies, or for any other reason, that distribution or offering may not be made available to Owners, and the Depositary may not dispose of that distribution or offering on behalf of Owners and make the net proceeds available to Owners, then the Depositary shall not make that distribution or offering available to Owners, and shall allow any rights, if applicable, to lapse.

 

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Neither the Company nor the Depositary assumes any obligation or shall be subject to any liability under the Deposit Agreement to Owners or Holders, except that they agree to perform their obligations specifically set forth in the Deposit Agreement without negligence or bad faith.  The Depositary shall not be subject to any liability with respect to the validity or worth of the Deposited Securities.  Neither the Depositary nor the Company shall be under any obligation to appear in, prosecute or defend any action, suit, or other proceeding in respect of any Deposited Securities or in respect of the American Depositary Shares, on behalf of any Owner or Holder or other person.  Neither the Depositary nor the Company shall be liable for any action or non-action by it in reliance upon the advice of or information from legal counsel, accountants, any person presenting Shares for deposit, any Owner or Holder, or any other person believed by it in good faith to be competent to give such advice or information.  Each of the Depositary and the Company may rely, and shall be protected in relying upon, any written notice, request, direction or other document believed by it to be genuine and to have been signed or presented by the proper party or parties.  The Depositary shall not be liable for any acts or omissions made by a successor depositary whether in connection with a previous act or omission of the Depositary or in connection with a matter arising wholly after the removal or resignation of the Depositary, provided that in connection with the issue out of which such potential liability arises, the Depositary performed its obligations without negligence or bad faith while it acted as Depositary.  The Depositary shall not be liable for the acts or omissions of any securities depository, clearing agency or settlement system in connection with or arising out of book-entry settlement of American Depositary Shares or Deposited Securities or otherwise.  In the absence of bad faith on its part, the Depositary shall not be responsible for any failure to carry out any instructions to vote any of the Deposited Securities or for the manner in which any such vote is cast or the effect of any such vote.  The Depositary shall have no duty to make any determination or provide any information as to the tax status of the Company or any liability for any tax consequences that may be incurred by Owners or Holders as a result of owning or holding American Depositary Shares.  No disclaimer of liability under the Securities Act of 1933 is intended by any provision of the Deposit Agreement.

 

19.                               RESIGNATION AND REMOVAL OF THE DEPOSITARY; APPOINTMENT OF SUCCESSOR CUSTODIAN.

 

The Depositary may at any time resign as Depositary under the Deposit Agreement by written notice of its election so to do delivered to the Company, to become effective upon the appointment of a successor depositary and its acceptance of such appointment as provided in the Deposit Agreement.  The Depositary may at any time be removed by the Company by 90 days’ prior written notice of that removal, to become effective upon the later of (i) the 90th day after delivery of the notice to the Depositary and (ii) the appointment of a successor depositary and its acceptance of its appointment as provided in the Deposit Agreement.  The Depositary in its discretion may at any time appoint a substitute or additional custodian or custodians.

 

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20.                               AMENDMENT.

 

The form of the Receipts and any provisions of the Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary without the consent of Owners or Holders in any respect which they may deem necessary or desirable.  Any amendment that would impose or increase any fees or charges (other than taxes and other governmental charges, registration fees, cable, telex or facsimile transmission costs, delivery costs or other such expenses), or that would otherwise prejudice any substantial existing right of Owners, shall, however, not become effective as to outstanding American Depositary Shares until the expiration of 30 days after notice of that amendment has been Disseminated to the Owners of outstanding American Depositary Shares. Every Owner and Holder, at the time any amendment so becomes effective, shall be deemed, by continuing to hold American Depositary Shares or any interest therein, to consent and agree to that amendment and to be bound by the Deposit Agreement as amended thereby. Upon the effectiveness of an amendment to the form of Receipt, including a change in the number of Shares represented by each American Depositary Share, the Depositary may call for surrender of Receipts to be replaced with new Receipts in the amended form or call for surrender of American Depositary Shares to effect that change of ratio.  In no event shall any amendment impair the right of the Owner to surrender American Depositary Shares and receive delivery of the Deposited Securities represented thereby, except in order to comply with mandatory provisions of applicable law.

 

21.                               TERMINATION OF DEPOSIT AGREEMENT.

 

(a)                                 The Company may initiate termination of the Deposit Agreement by notice to the Depositary.  The Depositary may initiate termination of the Deposit Agreement if (i) at any time 90 days shall have expired after the Depositary delivered to the Company a written resignation notice and a successor depositary has not been appointed and accepted its appointment as provided in Section 5.4 of that Agreement, (ii) an Insolvency Event or Delisting Event occurs with respect to the Company or (iii) a Termination Option Event has occurred or will occur.  If termination of the Deposit Agreement is initiated, the Depositary shall Disseminate a notice of termination to the Owners of all American Depositary Shares then outstanding setting a date for termination (the “Termination Date”), which shall be at least 90 days after the date of that notice, and the Deposit Agreement shall terminate on that Termination Date.

 

(b)                                 After the Termination Date, the Company shall be discharged from all obligations under the Deposit Agreement except for its obligations to the Depositary under Sections 5.8 and 5.9 of that Agreement.

 

(c)                                  At any time after the Termination Date, the Depositary may sell the Deposited Securities then held under the Deposit Agreement and may thereafter hold uninvested the net proceeds of any such sale, together with any other cash then held by it hereunder, unsegregated and without liability for interest, for the pro rata benefit of the Owners of American Depositary Shares that remain outstanding, and those Owners will be general creditors of the Depositary with respect to those net proceeds and that other cash.  After making that sale, the Depositary shall be discharged from all obligations under the Deposit Agreement, except (i) to account for the net proceeds and other cash (after deducting, in each case, the fee of the Depositary for the surrender of American Depositary Shares, any expenses for the account of the Owner of such American Depositary Shares in accordance with the terms and conditions of the Deposit Agreement and any applicable taxes or governmental charges) and pay them to Owners upon surrender of American Depositary Shares in accordance with Section 2.5 of that Agreement and (ii) for its obligations under Section 5.8 of that Agreement and (iii) to act as provided in paragraph (d) below.

 

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(d)                                 After the Termination Date, if any American Depositary Shares shall remain outstanding, the Depositary shall continue to receive dividends and other distributions pertaining to Deposited Securities (that have not been sold), may sell rights and other property as provided in the Deposit Agreement and shall deliver Deposited Securities (or sale proceeds) upon surrender of American Depositary Shares (after payment or upon deduction, in each case, of the fee of the Depositary for the surrender of American Depositary Shares, any expenses for the account of the Owner of those American Depositary Shares in accordance with the terms and conditions of the Deposit Agreement and any applicable taxes or governmental charges).  After the Termination Date, the Depositary shall not accept deposits of Shares or deliver American Depositary Shares.  After the Termination Date, (i) the Depositary may refuse to accept surrenders of American Depositary Shares for the purpose of withdrawal of Deposited Securities (that have not been sold) if in its judgment the requested withdrawal would interfere with its efforts to sell the Deposited Securities, (ii) the Depositary will not be required to deliver cash proceeds of the sale of Deposited Securities until all Deposited Securities have been sold and (iii) the Depositary may discontinue the registration of transfers of American Depositary Shares and suspend the distribution of dividends and other distributions on Deposited Securities to the Owners and need not give any further notices or perform any further acts under the Deposit Agreement except as provided in Section 6.2 of that Agreement.

 

22.                               DTC DIRECT REGISTRATION SYSTEM AND PROFILE MODIFICATION SYSTEM.

 

(a)                                 Notwithstanding the provisions of Section 2.4 of the Deposit Agreement, the parties acknowledge that DTC’s Direct Registration System (“DRS”) and Profile Modification System (“Profile”) apply to the American Depositary Shares upon acceptance thereof to DRS by DTC.  DRS is the system administered by DTC that facilitates interchange between registered holding of uncertificated securities and holding of security entitlements in those securities through DTC and a DTC participant.  Profile is a required feature of DRS that allows a DTC participant, claiming to act on behalf of an Owner of American Depositary Shares, to direct the Depositary to register a transfer of those American Depositary Shares to DTC or its nominee and to deliver those American Depositary Shares to the DTC account of that DTC participant without receipt by the Depositary of prior authorization from the Owner to register that transfer.

 

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(b)                                 In connection with DRS/Profile, the parties acknowledge that the Depositary will not determine whether the DTC participant that is claiming to be acting on behalf of an Owner in requesting registration of transfer and delivery described in paragraph (a) above has the actual authority to act on behalf of that Owner (notwithstanding any requirements under the Uniform Commercial Code).  For the avoidance of doubt, the provisions of Sections 5.3 and 5.8 of the Deposit Agreement apply to the matters arising from the use of the DRS/Profile.  The parties agree that the Depositary’s reliance on and compliance with instructions received by the Depositary through the DRS/Profile system and otherwise in accordance with the Deposit Agreement, shall not constitute negligence or bad faith on the part of the Depositary.

 

23.                               ARBITRATION; SETTLEMENT OF DISPUTES.

 

Any controversy, claim or cause of action brought by any party hereto against the Company arising out of or relating to the Shares or other Deposited Securities, the American Depositary Shares, the Receipts or the Deposit Agreement, or the breach hereof or thereof, if so elected by the claimant, shall be settled by arbitration in accordance with the International Arbitration Rules of the American Arbitration Association, and judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof.

 

The place of the arbitration shall be The City of New York, State of New York, United States of America, and the language of the arbitration shall be English.

 

The number of arbitrators shall be three, each of whom shall be disinterested in the dispute or controversy, shall have no connection with any party thereto, and shall be an attorney experienced in international securities transactions. Each party shall appoint one arbitrator and the two arbitrators shall select a third arbitrator who shall serve as chairperson of the tribunal. If a dispute, controversy or cause of action shall involve more than two parties, the parties shall attempt to align themselves in two sides (i.e., claimant(s) and respondent(s)), each of which shall appoint one arbitrator as if there were only two parties to such dispute, controversy or cause of action. If such alignment and appointment shall not have occurred within thirty (30) calendar days after the initiating party serves the arbitration demand, the American Arbitration Association shall appoint the three arbitrators, each of whom shall have the qualifications described above. The parties and the American Arbitration Association may appoint from among the nationals of any country, whether or not a party is a national of that country.

 

The arbitral tribunal shall have no authority to award any consequential, special or punitive damages or other damages not measured by the prevailing party’s actual damages and may not, in any event, make any ruling, finding or award that does not conform the terms and conditions of the Deposit Agreement.

 

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24.                               APPOINTMENT OF AGENT FOR SERVICE OF PROCESS; SUBMISSION TO JURISDICTION; JURY TRIAL WAIVER; WAIVER OF IMMUNITIES.

 

The Company has (i) appointed Law Debenture Corporate Services Inc., 801 Second Avenue, Suite 403,  New York, New York 10017, located in the State of New York, as the Company’s authorized agent upon which process may be served in any suit or proceeding (including any arbitration proceeding) arising out of or relating to the Shares or Deposited Securities, the American Depositary Shares, the Receipts or this Agreement, (ii) consented and submitted to the jurisdiction of any state or federal court in the State of New York in which any such suit or proceeding may be instituted, and (iii) agreed that service of process upon said authorized agent shall be deemed in every respect effective service of process upon the Company in any such suit or proceeding.

 

EACH PARTY TO THE DEPOSIT AGREEMENT (INCLUDING, FOR AVOIDANCE OF DOUBT, EACH OWNER AND HOLDER) THEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING AGAINST THE COMPANY AND/OR THE DEPOSITARY DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THE SHARES OR OTHER DEPOSITED SECURITIES, THE AMERICAN DEPOSITARY SHARES OR THE RECEIPTS, THE DEPOSIT AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREIN OR THEREIN, OR THE BREACH HEREOF OR THEREOF, INCLUDING WITHOUT LIMITATION ANY QUESTION REGARDING EXISTENCE, VALIDITY OR TERMINATION (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).

 

To the extent that the Company or any of its properties, assets or revenues may have or hereafter become entitled to, or have attributed to it, any right of immunity, on the grounds of sovereignty or otherwise, from any legal action, suit or proceeding, from the giving of any relief in any respect thereof, from setoff or counterclaim, from the jurisdiction of any court, from service of process, from attachment upon or prior to judgment, from attachment in aid of execution or judgment, or other legal process or proceeding for the giving of any relief or for the enforcement of any judgment, in any jurisdiction in which proceedings may at any time be commenced, with respect to its obligations, liabilities or any other matter under or arising out of or in connection with the Shares or Deposited Securities, the American Depositary Shares, the Receipts or the Deposit Agreement, the Company, to the fullest extent permitted by law, hereby irrevocably and unconditionally waives, and agrees not to plead or claim, any such immunity and consents to such relief and enforcement.

 

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25.                               DISCLOSURE OF INTERESTS.

 

When required in order to comply with applicable laws and regulations or the articles of association or similar document of the Company, the Company may from time to time request each Owner and Holder to provide to the Depositary information relating to: (a) the capacity in which it holds American Depositary Shares, (b) the identity of any Holders or other persons or entities then or previously interested in those American Depositary Shares and the nature of those interests and (c) any other matter where disclosure of such matter is required for that compliance.   Each Owner and Holder agrees to provide all information known to it in response to a request made pursuant to this Section.  Each Holder consents to the disclosure by the Owner or other Holder through which it holds American Depositary Shares, directly or indirectly, of all information responsive to a request made pursuant to this Section relating to that Holder that is known to that Owner or other Holder.  The Depositary agrees to use reasonable efforts, at the Company’s expense, to comply with written instructions requesting that the Depositary forward any request authorized under this Section to the Owners and to forward to the Company any responses it receives in response to that request.

 

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