Document:

EX-4.10

 Exhibit 4.10 

 
  

SHARE PURCHASE AGREEMENT 
 (FPSO Sevan Piranema) 
  

 
 Between

 SEVAN MARINE ASA 
 and 
 PIRANEMA LLC 

regarding the shares in 
 SEVAN PRODUCTION AS 
 29 November 2011 

 TABLE OF CONTENTS 

 

					
	 1. Certain definitions
	  	 	4	  
	 2. Transfer of Shares and Remaining Debt
	  	 	11	  
	 3. Purchase Price
	  	 	11	  
	 4. Adjustment of the Purchase Price
	  	 	12	  
	 5. Closing
	  	 	13	  
	 6. Deliveries by the Buyer
	  	 	14	  
	 7. Deliveries by the Seller
	  	 	14	  
	 8. Seller’s pre-Closing covenants/Interim Period
	  	 	15	  
	 9. Post-Closing obligations
	  	 	16	  
	 10. Buyer’s conditions for Closing
	  	 	16	  
	 11. Best efforts
	  	 	17	  
	 12. Seller’s representations and warranties
	  	 	18	  
	 13. Seller’s liability
	  	 	22	  
	 14. Third Party Claims
	  	 	24	  
	 15. Buyer’s Representation and Warranties
	  	 	24	  
	 16. Buyer’s Liability
	  	 	25	  
	 17. Term and termination
	  	 	25	  
	 18. Expenses
	  	 	25	  
	 19. Confidentiality
	  	 	25	  
	 20. Notices
	  	 	26	  
	 21. Entire Agreement
	  	 	26	  
	 22. Announcement
	  	 	26	  
	 23. Miscellaneous
	  	 	26	  

 Schedules: 
  

	 	1.	Example balance sheet 

	 	2.	Data room index 

	 	3.	License 

	 	4.	Transfer Agreement relating to the Subsidiary Minority Shares 

  
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 This share purchase agreement (the “Agreement”) is entered into on 29
November 2011 by and between: 
 Sevan Marine ASA, a company registered in Norway with registration number 983 218 180
(“Seller”); and 
 Piranema LLC, a a company incorporated according to the law of the Marshall Islands of Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands (the “Buyer”), 
 (the Seller and the Buyer
individually a “Party” and collectively the “Parties”). 
 WHEREAS 

 

	 	a)	the Seller is the owner of the Shares; 

  

	 	b)	the Company (as defined below) is the owner of the FPSO Sevan Piranema (as defined below) and the Subsidiary Shares (as defined below) in the Subsidiary (as defined
below), and party to the Piranema Agreements (as defined below); 

  

	 	c)	Teekay (as defined below) and the Seller have entered into a term sheet dated 18 October 2011 (the “Term Sheet”), whereby they have agreed
to carry out a transaction which includes, among other matters, the acquisition by Teekay or an Affiliate of Teekay from the Seller or an Affiliate of the Seller, of the FPSO Sevan Voyageur, FPSO Sevan Piranema and FPSO Sevan Hummingbird (jointly,
the “FPSOs”), including (i) a non-exclusive, irrevocable and royalty free license to use each FPSO and all intellectual property and information required for the use, operation, modification, repair, maintenance and sale
of the FPSOs worldwide, and (ii) all relevant charter agreements, lease & operations agreements and such other agreements as identified by Teekay and directly related to the respective FPSO; 

 

	 	d)	the Subsidiary Minority Seller (as defined below) is the owner of the Subsidiary Minority Shares (as defined below); and 

 

	 	e)	therefore, the Parties have agreed that the Seller shall sell and that the Buyer shall purchase the Shares and the Remaining Debt, and that the Subsidiary Minority
Seller shall sell and the Subsidiary Minority Buyer shall purchase the Subsidiary Minority Shares, on and subject to the terms and conditions of this Agreement. 

  
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	1.	Certain definitions 

Unless defined herein, all capitalized terms in the Term Sheet shall have the same meaning in this Agreement. In addition, as used in
this Agreement, the following terms have the following meaning unless the context otherwise requires: 
  

					
		 	Accounting Principles	  	means the applicable generally accepted accounting principles as defined by law and regulations and accounting standards issued by the relevant accounting standards board, as set
out in the Financial Statements and applied by the Company and the Subsidiary, respectively.
			
		 	Actual Cash	  	shall mean the consolidated Cash of the Company and the Subsidiary as at Closing, as set out in the Closing Balance Sheet.
			
		 	Actual Debt	  	shall mean the consolidated Debt of the Company and the Subsidiary as at Closing, as set out in the Closing Balance Sheet.
			
		 	Actual Net Working Capital	  	shall mean the consolidated Net Working Capital of the Company and the Subsidiary as at Closing, as set out in the Closing Balance Sheet.
			
		 	Adjustment Amount	  	shall have the meaning ascribed to it in section 4.4.
			
		 	Affiliates	  	shall mean, with respect to any Person, another Person to which it is related as set out in Section 1-5 subsection 1 of the Norwegian Limited Liability Companies Act, and also any
Person by which such first mentioned Person is an Affiliate.
			
		 	Agreement	  	shall mean this Agreement and its Schedules (as amended).
			
		 	Business Days	  	shall mean a day other than Saturday, Sunday or any other day on which banks in Norway are closed.

  
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		 	 Buyers’ Representations
 and Warranties
	  	shall mean the representations and warranties given by the Buyers to the Seller as set forth in section 15.
			
		 	Cash	  	shall mean the sum of all cash in hand, at the bank or at any other financial institution and cash equivalents (to the extent not included in the Net Working Capital), an example
calculation of which as of 30 September 2011 has been included in Schedule 1.
			
		 	Cash Payment	  	shall mean USD 165 million less the Piranema Cost Contribution.
			
		 	Charter Contract	  	shall mean the charter contract between the Subsidiary and Petrobras for the FPSO Sevan Piranema.
			
		 	Closing	  	shall mean completion of the transfer of the Shares and the Remaining Debt as set out in section 2.
			
		 	Closing Balance Sheet	  	shall have the meaning ascribed to it in section 4.5.
			
		 	Closing Date	  	shall mean the date set out in section 5.1.
			
		 	Company	  	shall mean Sevan Production AS, a company registered in Norway with registration number 985 973 245.
			
		 	Confidential Information	  	shall have such meaning as described to that term in section 19.
			
		 	Debt	  	shall mean (i) the long term indebtedness of the Company and the Subsidiary owed to any third party, but excluding for the avoidance of doubt, any such liabilities owed by any of
them to each other, (ii) the principal component of any lease obligation that is required to be recorded as a capitalised lease in accordance with the Accounting Principles; and (iii) dividend and group contributions payables of the Company or the
Subsidiary (other than to the Company or the Subsidiary); all to the extent not included in the Net Working Capital, an example calculation of which as of 30 September 2011 has been included in Schedule 1, and also excluding the Remaining
Debt.

  
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		 	Debt Consideration	  	shall mean USD 164,990,000, which is the consideration for the Remaining Debt.
			
		 	Disclosed Information	  	shall mean all of the information made available to Teekay and its advisors in the virtual data room with project name “Blackhawk”, containing commercial, accounting,
technical, financial and legal information relating to the Company or the Subsidiary, including as specified in the index list attached as Schedule 2, and any additional information provided to Teekay including, but not limited to, management
presentations, responses to requests, memorandums, hand-outs, orally or pursuant to visits to premises and in any form or medium in which such information may be recorded or kept.
			
		 	Due Diligence	  	shall mean the due diligence investigations into the legal, operational, financial and technical (including on-site physical inspection of the FPSO Sevan Piranema) affairs of the
Company and the Subsidiary conducted by Teekay and its advisors prior to the Signing Date.
			
		 	EGM	  	shall mean the extraordinary general meeting of the Seller held on 14 November 2011.
			
		 	Encumbrances	  	shall mean any mortgages, charges, pledges, assignments liens, options rights of first refusal and pre-emption, non-disposal clauses, retention covenants, easements, usufructs,
agreements, statements and, without prejudice to the foregoing, generally any other restrictions or encumbrances of any kind.
			
		 	Financial Statements	  	shall mean the audited annual accounts of the Company and the unaudited annual accounts of the Subsidiary, respectively, in respect of the fiscal year 2010, if available, including
the balance sheet and profit and loss statement, and the notes thereto.

  
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		 	FPSO Sevan Piranema	  	shall mean the floating production, storage and offloading vessel Sevan Piranema with everything belonging to her on board and on shore including but not limited to, the offloading
system and the mooring system (including chains and anchors) and the spares belonging to the FPSO Sevan Piranema.
			
		 	Governmental Entity	  	shall mean any (i) multinational, federal, provincial, state, municipal, local or other governmental or public department, central bank, court, commission, board, bureau, agency or
instrumentality, domestic or foreign, (ii) any subdivision or authority of any of the foregoing, or (iii) any quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the
above.
			
		 	Intellectual Property	  	shall mean any intellectual property, including but not limited to (a) patents and patent applications, (b) registered and unregistered trademarks, trade names and product names,
(c) company names, (d) domain names, (e) copyrights, and (f) trade secrets and proprietary know-how.
			
		 	Intercompany Loans	  	shall mean the aggregate of the amounts owing (including any interest), as at the close of business on the Closing Date, from the Company or the Subsidiary to the members of the
Seller’s Group, but excluding the Remaining Debt.
			
		 	Interim Period	  	shall mean the period of time between the Signing Date of this Agreement and Closing.
			
		 	Loss	  	shall have the meaning ascribed to such term in section 13.1.
			
		 	Material Adverse Effect	  	shall mean any materially adverse effect with regard to the financial or physical condition, business, operations and prospects, of the Company, the Subsidiary and/or the FPSOs, as
relevant, other than any change, circumstance or effect resulting from general economic conditions or circumstances or any change, circumstance or effect generally affecting the industry in which the Seller’s Group, the Company or the
Subsidiary operates.

  
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		 	Net Debt	  	shall mean Debt less Cash.
			
		 	Net Working Capital	  	shall mean (a) the aggregate of all (i) accounts receivable, and (ii) any other current assets, including inventory, work in progress and goods under production, less (b) the
aggregate of (i) all accounts payable, (ii) other short term non interest bearing liabilities, (iii) actual reserves for bad debt allowances, inventories, work in progress, prepaid items and other current assets; all items to the extent not
including the Cash or Debt, an example calculation of which as at 30 September 2011 has been included in Schedule 1.
			
		 	Person	  	shall mean any individual, corporation, partnership, firm, joint venture, association, joint stock company, trust, unincorporated organisation, Governmental Entity or other
entity.
			
		 	Petrobras	  	shall mean Petróleo Brasileiro S.A, including its Affiliates.
			
		 	Piranema Agreements	  	shall mean the Charter Contract and service agreement entered into with Petrobras in respect of the FPSO Sevan Piranema, and any other material agreements entered into by Company or
any of its Affiliates in respect of the current operations of the FPSO Sevan Piranema.
			
		 	Piranema Bond	  	shall mean the USD 270 million senior secured callable bond loan 2007/2013, issued by the Seller, secured inter alia by a first priority mortgage over the FPSO Sevan
Piranema.
			
		 	Piranema Cost Contribution	  	shall mean the Piranema Cost Contribution calculated in accordance with section 3 of the Term Sheet.

  
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		 	Purchase Price	  	shall mean USD 165 million, which is the sum of the Share Consideration and the Debt Consideration.
			
		 	Remaining Debt	  	shall mean a loan from Seller to the Company with an outstanding total balance including any accrued but unpaid interest and any other unpaid charges, immediately before Closing of
USD 164,990,000.
			
		 	Seller’s Group	  	shall mean Sevan Marine ASA and its Affiliates, excluding the Company and the Subsidiary.
			
		 	Seller’s Knowledge	  	shall mean the actual knowledge each of Carl Lieungh, Reese McNeel (however without personal liability or any recourse for the Buyer, Teekay or any Affiliate thereof against
AlixPartners), Lars Ødeskaug, Oskar Mykland and Birte Norheim (limited to knowledge up to the time Norheim left Sevan), and the directors of Seller and the Company, had at the Signing Date and the Closing Date.
			
		 	Seller’s Representations and Warranties	  	shall mean the representations and warranties given by the Seller to the Buyer as set forth in section 12.
			
		 	Share Consideration	  	shall mean in the aggregate USD 10,000, divided into USD 9,000 for the Shares sold by the Seller and USD 1,000 for the Subsidiary Minority Shares.
			
		 	Shares	  	shall mean all issued and outstanding shares in the Company on a fully diluted basis, and any shares to be issued by the Company upon conversion of the Intercompany Loans as set out
in section 7.1(f).
			
		 	Signing Date	  	shall mean the date of this Agreement.
			
		 	Subsidiary	  	shall mean Sevan Piranema Servicios de Petróleo Ltda, a Brazilian limited company with reg. no. 07.457.961/0001-79.
			
		 	Subsidiary Minority Buyer	  	shall mean Teekay Offshore Partners LP, a company registered in the Marshall Islands.

  
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		 	Subsidiary Minority Seller	  	shall mean Sevan Marine do Brasil Ltda, a company registered in Brazil with registration number 04.513.237/0001-27.
			
		 	Subsidiary Minority Shares	  	shall mean 0.01 per cent of the quotas in the Subsidiary, owned by the Subsidiary Minority Seller, equal to 2 quotas, to be transferred by the Subsidiary Minority Seller to the
Subsidiary Minority Buyer pursuant to the Transfer Agreement.
			
		 	Subsidiary Shares	  	shall mean all issued and outstanding quotas of the Subsidiary on a fully diluted basis (less the Subsidiary Minority Shares).
			
		 	Target Net Debt	  	shall be USD 0.
			
		 	Target Net Working Capital	  	shall be USD 0.
			
		 	Tax	  	shall mean all tax liabilities, whether actual or deferred, in respect of income taxes, sales taxes, VAT, withholding taxes, stamp duties, share transfer taxes, payroll taxes,
social security taxes and property taxes and all other taxes and public duties of any kind, together with all interest, penalties and additions imposed with respect to such amounts.
			
		 	Tax Return	  	shall mean any return (including any information return), report, statement, schedule, notice, form or other document or information filed with or submitted to, or required to be
filed with or submitted to, any Governmental Entity in connection with the determination, assessment, collection or payment of any Taxes or in connection with the administration, implementation, or enforcement of or compliance with any applicable
statute, rule or regulation relating to any Taxes.
			
		 	Teekay	  	shall mean Teekay Corporation, a company incorporated under the laws of the Marshall Islands.

  
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	 Transfer Agreement
	  	shall mean the agreement attached hereto as Schedule 4.
		
	 Trustee
	  	shall mean Norsk Tillitsmann ASA, as trustee on behalf of the holders of the Piranema Bond.

  

	2.	Transfer of Shares and Remaining Debt 

  

	2.1	The Seller shall transfer the Shares and the Remaining Debt to the Buyer, on the terms and conditions set forth in this Agreement. 

 

	2.2	The Buyer shall have all rights and title to, and risk of, the Shares (which indirectly includes the FPSO Sevan Piranema and the Piranema Agreements), and the Remaining
Debt, from 00:00 hours CET on the Closing Date. 

  

	2.3	The Seller hereby grants to the Buyer, with effect from the Closing Date, a non-exclusive, perpetual, irrevocable and royalty free license to use the FPSO Sevan
Piranema and all Intellectual Property and information required for the use, operation, modification, repair, maintenance and sale of the FPSO Sevan Piranema worldwide, as further set out in Schedule 3. 

 

	2.4	The Shares and the Remaining Debt shall be transferred to the Buyer free of any Encumbrances on the Closing Date. All rights carried by the Shares are transferred with
the Shares, including, but not limited to, the title, the voting rights and the right to receive dividend on the Shares for the Company’s financial year 2011 and onwards. 

 

	2.5	The Parties agree to do or procure to be done all such further acts, including without limitation, execute or procure the execution of all such documents as may be
required to perfect the transfer of the Shares from the Seller to the Buyer. 

  

	3.	Purchase Price 

  

	3.1	The consideration for the Shares, the Subsidiarity Minority Shares and the Remaining Debt shall be the Purchase Price, adjusted as set out in section 4 below.

  

	3.2	The Cash Payment, shall, on or before Closing, be settled by cash payment to an account designated by the Trustee for distribution subject to Closing, to the Piranema
Bondholders, as full settlement of the Piranema Bond. 

  

	3.3	The Buyer shall on or before Closing transfer the Piranema Cost Contribution to the Trustee. The Trustee shall, subject to Closing, on the Seller’s behalf pay the
Piranema Cost Contribution to the relevant advisers and/or to Sevan with respect to reimbursement of the monthly retainers, fee reserves and fees that fall within the Advisory Fees (as defined in the Term Sheet). 

  
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	4.	Adjustment of the Purchase Price 

  

	4.1	Any adjustment of the Purchase Price in accordance with this section 4 shall be between and for the benefit and cost of Buyer or the Seller, and shall have no effect
for the holders of the Piranema Bond, provided that, for the avoidance of doubt, the Piranema Bondholders shall always be entitled to receive the Cash Payment. 

 

	4.2	Any adjustment of the Purchase Price in accordance with this section 4 relates to the value of the Shares and shall therefore in its entirety be allocated to and affect
the Share Consideration. 

  

	4.3	The Purchase Price is based on the assumption that the Company and the Subsidiary at the Closing Date shall have the Target Net Debt and the Target Net Working Capital.

  

	4.4	The Purchase Price shall be adjusted with an amount equal to (i) the Actual Cash, plus (ii) the Actual Net Working Capital (for the avoidance of doubt, the
Actual Net Working Capital shall be subtracted if it is a negative number) less (iii) the Actual Debt (such sum the “Adjustment Amount”). If the Adjustment Amount is a positive amount, it shall be paid by the Buyer to
the Seller. If the Adjustment Amount is a negative amount, it shall be paid by Seller to the Buyer. 

  

	4.5	The Adjustment Amount shall be calculated based on a consolidated balance sheet per the Closing Date (the “Closing Balance Sheet”). The Closing Balance
Sheet shall be prepared by the Seller in accordance with the Accounting Principles, shall be confirmed by the Seller’s auditor and shall be presented to Buyer no later than 30 Business Days after the Closing Date. The Buyer shall procure that
the Seller has access to all records of the Company and the Subsidiary reasonably required to produce the Closing Balance Sheet. 

  

	4.6	Any objection to the Closing Balance Sheet must be presented to the Seller within 30 Business Days after the date on which Buyer received the Closing Balance Sheet;
otherwise the Closing Balance Sheet will be final and the Adjustment Amount is immediately due for payment. If the Buyer objects to the Closing Balance Sheet, and the Buyer and the Seller fail to resolve the matter amicably within 10 Business Days
after the day on which the Buyer’s objection was received by the Seller, the Buyer and the Seller shall within 10 Business Days (i) either jointly appoint a Norwegian certified accountant or (ii) ask that the chairman of the Norwegian
Institute of Public Accountants appoint a Norwegian certified accountant (for the purposes of this section 4 the “Accountant”), who shall be immediately available to consider and resolve the matter in accordance with the Accounting
Principles. The Accountant shall decide on the matter based on written submissions from the Buyer and the Seller, which shall be submitted to the Accountant no later than 10 Business Days after the date on which the Accountant accepted the
Assignment. The Accountant shall deliver its decision within 30 Business Days after having accepted the assignment and the Adjustment Amount shall be paid within five Business Days of such decision. The decision of the Accountant is final and
binding (in the absence of manifest error) and shall be confidential. The cost of the Accountant shall be split 50/50 between the Buyer and the Seller. The Buyer and the Seller shall cover their own costs incurred in relation to the Closing Balance
Sheet and any dispute related thereto. 

  
 12 

	4.7	When the Closing Balance Sheet and Adjustment Amount (if any) is agreed or determined in accordance with this section 4, the Buyer or the Seller, as the case may be,
shall within five Business Days pay to the other Party by wire transfer of immediately available funds to the Buyer or the Seller, as the case may be, the Adjustment Amount (if any) together with interest calculated on the Adjustment Amount at a
rate equal to NIBOR (as quoted on page NIBP on the Reuters screen for interest periods of 6 months’ duration on the Closing Date) plus a margin of 200 basis points, for the period between Closing and the date the Adjustment Amount is paid (with
interest compounded every 6 months). 

  

	4.8	If any of the Parties fails to pay the Adjustment Amount by the deadline set out in sub-section 4.7, the prevailing interest on late payments in Norway as calculated in
accordance with the Norwegian Late Interest Payment Act (Nw. Forsinkelsesrenteloven) shall apply from such deadline until the Adjustment Amount is actually paid. 

 

	4.9	The Parties shall use their reasonable endeavours, and the Buyer shall procure that the Company and the Subsidiaries use their reasonable endeavours, to assist the
Buyer’s and the Seller’s respective representatives, the Buyer’s auditors, the Seller’s auditors and (if applicable) the Accountant and shall endeavour to procure that the matters required of each of them under this section 4 are
fulfilled as soon as practicable after their respective appointments. Without prejudice to the generality of the foregoing, each of the Parties shall promptly on request supply, or procure that promptly on request there is supplied, to such persons
all such documents and information as they each may reasonably require for fulfilment of their obligations under this section 4. 

  

	5.	Closing 

  

	5.1	Closing shall take place at the offices of Bugge, Arentz-Hansen & Rasmussen at Stranden 1, 0250 Oslo, on 30 November 2011 (the “Closing
Date”). 

  

	5.2	Each Party shall take all actions that are within its control and shall use all reasonable endeavours to procure the satisfaction of the conditions set out in section
10. 

  
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	6.	Deliveries by the Buyer 

  

	6.1	At Closing the Buyer shall: 

  

	 	a)	Pay the Purchase Price (including, for the avoidance of doubt, the Cash Payment) as set out in section 3; 

 

	 	b)	deliver all such documents which are required under Norwegian law for Seller to complete the registration of Buyer as owner of the Shares and all such documents which
are required under Brazilian law to complete the transfer of the Subsidiary Minority Shares; and 

  

	 	c)	deliver to the Seller such other documents and instruments as the Seller may reasonably request in order to properly perfect the Seller’s rights under this
Agreement. 

  

	7.	Deliveries by the Seller 

  

	7.1	At Closing the Seller shall: 

  

	 	a)	Do all such things and deliver all such documentation which is required to perfect the transfer of the Shares to the Buyer, and provide such documentation which under
Norwegian law properly confirms the Buyer as owner of the Shares, among other a transcript of the Company’s share register in which the Buyer is registered as the owner of the Shares and in which no Encumbrance over the Shares is registered,
and all such documents which are required under Brazilian law to complete the transfer of the Subsidiary Minority Shares; 

  

	 	b)	deliver to the Buyer a transcript from the Bahamas register, in which the FPSO Sevan Piranema is registered, which shall confirm that the Company is the owner of the
FPSO Sevan Piranema, and that no Encumbrance is registered over the FPSO Sevan Piranema; 

  

	 	c)	deliver to the Buyer a copy of the License executed by the Seller; 

  

	 	d)	deliver to the Buyer copy of the minutes of a meeting of the board of directors of the Company approving the transfer of the Shares to the Buyer without any conditions
or reservations; 

  

	 	e)	deliver to the Buyer written evidence of the resignation effective as at Closing by the current members of the board of the Company and the Subsidiary, and that they
have received all payments due and owing to them, and that they are not entitled to receive any additional fees or reimbursement of expenses from any the Company or the Subsidiary; 

  
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	 	f)	deliver to the Buyer written evidence that the Company and the Subsidiary confirm that all Intercompany Loans in existence before Closing has been settled in full by
contribution to equity to be completed by as an increase of the face value of the Shares (or Subsidiary Shares, if applicable) and not by issuance of new Shares (or Subsidiary Shares, if applicable), with the exception of the debt from the
Subsidiary towards the Seller and Sevan Marine Do Brasil Ltda, which will be forgiven by the Seller; 

  

	 	g)	evidence satisfactory to the Buyer of fulfilment of the conditions precedent for Closing as set out in section 10; 

 

	 	h)	deliver a copy of a notice from Seller to the Company that the Remaining Debt with effect from Closing has been assigned to the Buyer as new creditor; and

  

	 	i)	deliver to the Buyer such other documents and instruments as the Buyer may reasonably request in order to properly perfect the Buyer’s rights under this Agreement.

  

	8.	Seller’s pre-Closing covenants/Interim Period 

  

	8.1	The Seller undertakes to the Buyer that the operation and maintenance of the FPSO Sevan Piranema and the business of the Company and the Subsidiary in the Interim
Period shall be conducted in a manner consistent with past practice, hereunder that the Company and the Subsidiary shall continue to meet all expenditures and receive all income relating to their activities. 

 

	8.2	Seller shall in the Interim Period grant, and shall procure that the Company and the Subsidiary grant the Buyer’s and Buyer’s Affiliates’ personnel
access to their facilities, and to the extent legally permissible, provide the Buyer with information and reports reasonably requested by the Buyer. 

  

	8.3	Seller shall procure that the Company and the Subsidiary in the Interim Period without the Buyer’s prior written approval does not acquire or dispose of assets
which alone or in the aggregate are material. 

  

	8.4	Seller shall procure that the Company and the Subsidiary shall not settle any dispute, amend, cancel, terminate or waive any rights under the Piranema Agreements,
including, among other, the Charter Contract, or enter into new material agreements relating to the current or future operation of FPSO Sevan Piranema. 

  
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	8.5	The Seller shall during the Interim Period immediately notify the Buyer in writing about any Material Adverse Effect which has occurred or which the Seller reasonably
should have understood may occur. 

  

	8.6	To the extent all procedural steps to take place in respect of the transfer of the Subsidiary Minority Shares have not occurred at Closing, the Seller will assist, and
procures that the Subsidiary Minority Seller will assist, the Buyer and the Subsidiary Minority Buyer in ensuring that such procedural steps will be completed as soon as possible after Closing. 

 

	9.	Post-Closing obligations 

  

	9.1	The Seller shall for a period of six months after Closing assist the Buyer and Buyer’s Affiliates with matters relating to financials, accounting and bookkeeping
as reasonable requested by the Buyer to ensure that such matters are not adversely affected by the transaction. Any such post-closing services delivered by Seller shall be for the reasonable cost of Buyer as further agreed between the Seller and the
Buyer. 

  

	9.2	The Buyer undertakes to use its best efforts to as soon as reasonably possible and latest by 3 months following Closing replace Sevan Marine do Brasil Ltda, a Brazilian
limited company with reg. no. 04.513.237/001-27 (for the purposes of this sub-section 9.2 the “Brazilian Guarantor”), as the guarantor of the temporary admission condition of FPSO Sevan Piranema, and shall indemnify the
Brazilian Guarantor and/or the Seller for all costs incurred after Closing as a result of posting such guarantee. 

  

	10.	Buyer’s conditions for Closing 

  

	10.1	The obligation of the Buyer to consummate the transfer of the Shares is subject to the fulfilment, on or before the Closing Date, of each of the following:

  

	 	a)	All consents and/or approvals to the FPSO Transactions (as defined in the Term Sheet) being obtained, including (but not limited to) consents and/or amendments and/or
approvals with respect to (i) the Agreements (as defined in the Term Sheet), including but not limited to receipt of waivers from the Seller’s customers and key suppliers, satisfactory to Teekay, waiving their existing and continuing
rights of termination, step-in and other similar remedies available due to the Seller’s financial and other defaults as well as any claims for damages due to inter alia delays, (ii) any competition authorities and other public authorities
(if any), (iii) the bondholders under the Bond Loans (as defined in the Term Sheet) (including all such amendments, modifications and waivers as reasonably contemplated by the Term Sheet); such approvals to be granted by bondholders’
meetings in each Bond Loan where the required majority to allow for a repayment of the Bond Loans in accordance with “Repayment and termination of existing debts” as set out in the Term Sheet, and full release of all security thereunder is
obtained, and (iv) the ING Facility, including a consent from the banks not to enforce any security or to utilize the step-in rights of the banks under the ING Facility, and a consent from the banks to Teekay (or a subsidiary of Teekay)
assuming the ING Facility; 

  
 16 

	 	b)	execution of all Transaction (as defined in the Term Sheet) documents satisfactory to Teekay, the Seller and the Trustee; 

 

	 	c)	the EGM has resolved (i) to approve the FPSO Transactions, (ii) to approve the Omnibus Agreement (as defined in the Term Sheet), (iii) to issue the
shares under the Placements (as defined in the Term Sheet), (iv) to appoint two directors nominated by Teekay at the board of directors of Sevan, and (v) to appoint a new chairperson for the nomination committee of Sevan (or such other
member as agreed by Teekay), such person to be nominated by Teekay; 

  

	 	d)	no Material Adverse Effect has occurred between the date of the Term Sheet and Closing; 

 

	 	e)	any and all guarantee obligations whereby any member of the Seller’s Group has guaranteed the obligations of Sevan Drilling ASA (or any subsidiary or affiliate of
Sevan Drilling ASA) shall have been unconditionally released, and such releases documented to the reasonable satisfaction of Teekay; 

  

	 	f)	except as will not have a Material Adverse Effect; the Seller’s confirmation that the representations and warranties of the Seller are true and correct in all
material respects; and 

  

	 	g)	no injunction order or other order shall be in effect preventing or forbidding the consummation of the transfer of the Shares and no legal action or governmental
investigations shall be pending or threatened which, if adversely determined, would reasonably be expected to result in any such injunction or order. 

  

	11.	Best efforts 

 Between the
date of this Agreement and the Closing Date, the Seller and the Buyer, as applicable, shall use their best efforts to cause the conditions set out in section 10 to be satisfied as promptly as practicable, and will seek to take any other action
required or advisable in connection with the transfer of the Shares and the payment of the Purchase Price. 
 The Seller shall
promptly notify the Buyer in writing in the event of the occurrence of a Material Adverse Effect. In the event of a Material Adverse Effect, the Buyer shall have the right to be excused from its obligations under this Agreement without prejudice to
available remedies in the event of the Material Adverse Effect being the result of an action or omission on the part of the Seller. 

  
 17 

	12.	Seller’s representations and warranties 

  

	12.1	The Seller represents and warrants to the Buyer the following, other than as specifically stated below, as per the Signing Date and the Closing Date (the
“Seller’s Representations and Warranties”). 

  

	12.2	Title 

  

	    	The Seller is the legal owner of the Shares, and the Company is the legal owner of the Subsidiary Shares. 

 

	12.3	No Encumbrances 

  

	    	The Shares, Subsidiary Shares, FPSO Sevan Piranema and the Piranema Agreements are, or will on Closing be, free of any Encumbrances. 

 

	12.4	Shares and Subsidiary Shares 

  

	    	The Shares are owned by the Seller, are fully paid up and represent all shares issued by the Company. The Company has issued no instruments, including but not limited
to convertible loans, options and warrants, which may be converted into new shares in the Company and has not entered into any agreement to issue any such convertible instrument. 

 

	    	The Subsidiary Shares are owned by the Company, are fully paid up and represent all shares issued by the Subsidiary. The Subsidiary has issued no instruments, including
but not limited to convertible loans, options and warrants, which may be converted into new shares in the Subsidiary and has not entered into any agreement to issue any such convertible instrument. 

 

	12.5	Authority 

  

	    	The Seller has the full right, power and authority to enter into the Agreement and the agreements contemplated hereby and to perform and to consummate all transactions
contemplated thereby. 

  

	    	The Agreement (i) has been duly approved and authorised by the relevant decision-making bodies of the Seller, (ii) is valid and binding on the Seller, and
(iii) is enforceable against the Seller in accordance with its terms. 

  
 18 

	12.6	No Breach 

  

	    	Neither the execution nor the performance of the Agreement will (i) conflict with or constitute breach or violation of the articles of association of the Seller or
the Company and/or applicable law, (ii) provided that necessary consents have been obtained from Petrobras (to the extent required); conflict with or result in breach of any agreement concluded by the Seller, the Company or the Subsidiary or
otherwise give any other contracting party the right to terminate or constitute a default under any such agreement, (iii) conflict with or constitute violation of any judgment, decision or order made by any court or administrative body against
or binding upon the Seller, the Company or the Subsidiary, or (iv), conflict with or constitute a violation of any law or regulation applicable to Seller, the Company, or the Subsidiary. 

There are no injunctions or restraining orders or other orders preventing or forbidding the consummation of the transactions contemplated
by this Agreement, and there are no legal actions or governmental investigations pending or threatened which, if adversely determined, would reasonably be expected to result in any such injunction. 

There are no suits, claims, actions, investigations, challenges, inquiries or other proceedings by any Governmental Entity or other Person
pending or, to the Seller’s Knowledge, threatened which will be of material importance in connection with any of the transactions contemplated by this Agreement. 
  

	12.7	The Company and the Subsidiary 

 The Company is a Person duly organised, validly existing and in good standing order under the laws of Norway and is not in violation of any applicable corporate rules, and has the corporate power and
lawful authority to own, lease and operate its assets and business and to carry on its business as now being conducted. 
 The
Subsidiary is a Person duly organised, validly existing and in good standing order under the laws of Brazil and is not in violation of any applicable corporate rules, and has the corporate power and lawful authority to own, lease and operate its
assets and business and to carry on its business as now being conducted. 
 Each of the Company and the Subsidiary is duly
qualified or licensed to conduct the business it is currently conducting in each jurisdiction in which such qualification or licensing is necessary, if any. 
  

	12.8	Employees 

 As at the
Signing Date and the First Completion (as defined in the Term Sheet), the Company or the Subsidiary has not terminated or received notice of termination from such number of employees that the Company or the Subsidiary does not possess the manpower
and competence required for the operation of the FPSO Sevan Piranema in compliance with applicable law and the Piranema Agreements. 

  
 19 

	12.9	Financial Statements – Documentation 

 The Financial Statements have been prepared in accordance with the Generally Accepted Accounting Principles, applied on a consistent basis and show, in all material respects, a true and fair view of the
assets and liabilities and results for the Company and Subsidiary, as of its relevant dates and for the relevant periods. 
 The
Company and the Subsidiary have good, marketable and clear title to all assets listed in the Closing Balance Sheet and which is included in the Actual Cash or Actual Net Working Capital. 

 

	12.10 	Condition of the FPSO Sevan Piranema  

 The FPSO Sevan Piranema is in class. 
  

	12.11 	Taxes 

 The Company and
the Subsidiary has duly and timely filed all Tax Returns required to be filed by it on or prior to the Closing Date with any relevant Governmental Entity. 
 All Taxes, charges, penalties, deficiencies or assessments, and any interest or penalties thereon due have been fully and timely paid or, to the extent that they are not yet due for payment, fully accrued
for in the Financial Statements. 
 All Tax Returns are, correct and complete and with respect to the corporate income tax
correctly reflect the taxable income of the Subsidiary in the relevant fiscal years. The Company and the Subsidiary has not been notified that any of their Tax Returns are presently under audit, and no claims have been raised by any tax authority in
connection with the Company’s or the Subsidiary’s Tax Returns that have not been addressed or fully reserved for in the Financial Statements, and there have not been any other investigations by any tax authority during the past 24 months.

  

	12.12 	Environmental Matters 

 To
the Seller’s Knowledge, (i) the Company and the Subsidiary complies and have at all relevant times complied in all material respect, with applicable environmental laws and licences; (ii) no material claim in relation to environmental
matters has been made or threatened against the Company or the Subsidiary or any occupier of any property at any time owned or leased by the Company or the Subsidiary, and (iii) the Company and the Subsidiary have all environmental permits and
approvals that are required for their current operations. 
  

	12.13 	Disputes 

 As at the
Signing Date and the First Completion (as defined in the Term Sheet), the Company or the Subsidiary is not the subject of or in any way involved in, any material disputes, claims, litigation or other legal proceedings, and to the Seller’s
Knowledge, there are no circumstances giving rise to such disputes, claims, litigation or proceedings. 

  
 20 

	12.14 	Agreements 

 The Piranema
Agreements are valid, binding and enforceable. 
 No default or breach of any material obligation has occurred or exists under
the Piranema Agreement (which, for the avoidance of doubt, shall not include uptime requirements or similar obligations). 
 All
contracts between the Company or the Subsidiary and any Seller Group Person have been entered into as part on arms’ length basis. 
  

	12.15 	Actions and Proceedings 

There are no outstanding orders, judgments, injunctions, awards or decrees of any arbitrator, court or other Governmental Entity which may
affect the evaluation of the Shares, including the business of the Company and the Subsidiary, or which in whole or in part, may interfere with the current or contemplated business of the Company and the Subsidiary. The FPSO Sevan Piranema is
operated, and the Company and the Subsidiary is, in all material respects in compliance with all applicable laws and regulations. 
  

	12.16 	Insurance 

 The Company
and the Subsidiary have the insurance set out in the Disclosed Information, and such insurance will be maintained and fully paid for up to and until Closing. 
  

	12.17 	Competition matters 

 To
the Seller’s knowledge each of the Company and the Subsidiary have not received notification by any competent antitrust or competition authority that it is, or has been party to, or concerned in any agreement, arrangement, understanding or
concerted practice, which infringes any applicable competition law rule. The Company or the Subsidiary is or have not been in violation of any applicable competition laws or similar regulations. 

 

	12.18 	Anti-Money Laundering, Anti-Corruption 

 To the Seller’s Knowledge, no agent, employee or other Person associated on the Seller’s behalf with the FPSO Sevan Piranema or acting on behalf of the Company or the Subsidiary directly or
indirectly, has offered to pay or provide or has paid or provided anything of value in the form of any unlawful contribution, gift or other materially unlawful expense to any Person for the purpose of gaining or retaining business or obtaining any
unfair advantage, nor made any bribe, kickback or other similar unlawful payment. To the Seller’s Knowledge, the Company and the Subsidiary is in compliance with all applicable anti-money laundering laws and regulations. 

  
 21 

	12.19 	Completeness of Disclosed Information 

 To the Seller’s Knowledge, (i) the Disclosed Information is in all material respects regarding the Shares and the Piranema Agreements true and accurate, (ii) there is no information in the
possession of the Seller concerning the Shares and the Piranema Agreements that is of material importance for the Buyer’s evaluation of the Shares and the Piranema Agreements that has not been provided to Teekay or its advisers 

 

	12.20 	No other Warranties 

 The
Buyer agrees that (i) the Seller has made no expressed or implied representation or warranty regarding the Shares and the Piranema Agreements other than the Seller’s Representations and Warranties; (ii) no action or omission by the
Seller shall be construed as implying any other representation and/or warranty, and no information provided by the Seller (other than the Seller’s Representations and Warranties) shall be construed as being information (Nw. opplysninger)
provided by the Seller in the meaning of the Norwegian Sales of Goods Act of 13 May 1988 no 27 § 18; (iii) except for the Seller’s Representations and Warranties, the Shares and the Piranema Agreements are sold in their
condition (“as is”) as of the Signing Date (provided, however that the Buyer waives all rights to make claims under the Norwegian Sales of Goods Act of 13 May 1988 no 27 § 19, including § 19(c)). 

 

	13.	Seller’s liability 

  

	13.1	In the event of a breach of the Seller’s Representation and Warranties and/or in the event of the Seller’s failure to fulfil any of its obligations under this
Agreement, the Seller shall compensate (Nw. erstatte) the Buyer from and against any reasonably foreseeable direct, net loss thereby suffered or incurred by either of the Buyer, the Company or the Subsidiary (the “Loss”), on
the terms and conditions set out in this section 13. 

 13.2 The Buyer shall actively and in good faith seek to mitigate its Loss.

  

	13.3	The Seller’s duty to indemnify the Buyer for any Loss suffered by the Buyer, the Company or the Subsidiary as a result of the Seller’s breach of any of the
Seller’s Representation and Warranties shall be subject to the following limitations: 

  

	 	a)	The Seller shall have no obligation to indemnify the Buyer unless the Buyer gives notice to the Seller within 10 Business Days after the Buyer became aware of the
events or circumstances giving rise to the claim. The Buyer’s notice shall state the specific grounds supporting the claim. Any claim shall within reasonable time following Buyer’s notice be supported by information about the amount of the
claim and written documentation necessary to support the claim. 

  
 22 

	 	b)	The Seller shall only be liable for Loss if the Seller receive notice of such Loss no later than on the first anniversary of the Closing Date. The liability of the
Seller for breach of the Seller’s Representation and Warranties contained in section 12.11 (Taxes) shall, however, expire two years after the Closing Date. 

 

	13.4	The Seller shall not be liable for any Loss unless (i) each individual Loss exceeds USD 1,000,000; (ii) until the aggregate amount of all Losses (excluding
the Losses for which the Seller has no liability according to sub-section (i) above) exceeds USD 5,000,000 (for the purposes of this section 13.4 the “Basket Amount”), but shall then be liable for the entire amount and
not just the excess of the Basket Amount; but (iii) only for aggregate Losses up to a total amount equivalent to 25% of the Purchase Price. 

  

	13.5	The Seller has invited Teekay to perform a due diligence investigation of the Company and the Subsidiary, including a physical inspection of the FPSO Sevan Piranema,
and Teekay has completed its due diligence investigation prior to entering into the Agreement. The Buyer’s right to compensation or other remedies under this Agreement shall not extend to matters which Teekay or any of its advisors had or
reasonably could have acquired knowledge of from the Disclosed Information or other information provided by Seller or any of its advisors to Teekay in connection with the transactions contemplated by this Agreement, including any matter,
circumstance, event or issue referred to in the Disclosed Information or information which the Seller has made publicly available. 

  

	13.6	The limitations of the Seller’s liability set out in this section 13 shall not apply in the event of fraud or wilful or negligent misrepresentation on the part of
the Seller. 

  

	13.7	The remedies provided for in this section 13 shall exclude any other claim for damages, Purchase Price reduction and all other remedies which would otherwise be
available by law, including the Norwegian Sales of Goods Act 27/1988. 

  

	13.8	Petroleum National Agency has applied a penalty to Petrobras of BRL 4.5 million for non-conformities identified with respect to the Piranema FPSO. To the extent
the penalty is upheld (regardless of the amount) and Petrobras seeks a recourse from the Company and/or the Subsidiary, the Seller shall hold the Buyer, the Company and the Subsidiary harmless from and against all such recourse claims (including any
reasonable legal and other fees and costs incurred in connection with defending such recourse claim) without any of the limitations set out in section 13.3, 13.4 and 13.5 being applicable. 

  
 23 

	13.9	The Seller will hold the Buyer, the Company and the Subsidiary harmless for any penalty imposed by a Governmental Entity for late filings of the Financial Statements,
without any of the limitations set out in section 13.3, 13.4 and 13.5 being applicable. 

  

	14.	Third Party Claims 

  

	14.1	If the Buyer receives notice of any claim by a third party which is or may be subject to compensation by the Seller under section 13 (for the purposes of this section
14 a “Third Party Claim”), the Buyer shall thereafter give the Seller prompt, and latest within 7 days, written notice of such Third Party Claim with all relevant information in its (or any of its affiliates’) possession
and the Seller shall, at the Seller’s option, have the right to participate in the defence thereof by counsel of the Seller’s choice. 

  

	14.2	If the Seller acknowledges in writing its obligations to compensate the Buyer against all Losses that may result from such Third Party Claim, the Seller shall be
entitled, at the Seller’s option and cost, to assume and control the defence of such Third Party Claim through counsel of the Seller’s choice. No such Third Party Claim may be settled by the Seller without the written consent of the Buyer,
which consent shall not be unreasonably withheld or delayed, unless the settlement involves only the payment of money by the Seller. 

  

	14.3	Similarly, no Third Party Claim which is being defended in good faith by the Seller shall be settled by the Buyer, the Company or the Subsidiary or any other affiliate
of the Buyer without the written consent of the Seller. The Seller shall have no obligation to indemnify the Buyer for any Losses resulting from the settlement of Third Party Claims in violation of the provisions of this clause 14.3.

  

	15.	Buyer’s Representation and Warranties 

  

	15.1	The Buyer represents and warrants to the Seller that the following representations (the “Buyer’s Representations and Warranties”) are true
and correct as of the date hereof and shall be true and correct at the Closing Date: 

  

	15.2	The Buyer (i) is a corporation duly organized and validly existing under the laws of Marshall Islands and (ii) has the full right, power and authority to
enter into the Agreement and to consummate all transactions contemplated thereby. 

  

	15.3	The Buyer and the Subsudiary Minority Buyer represent and warrant to the Seller, on the Signing Date and the Closing Date that the Agreement (i) has been duly
approved and authorised by the relevant decision-making bodies of the Buyer and the Subsidiary Minority Buyer, (ii) is valid and binding on the Buyer and the Subsidiary Minority Buyer, and (iii) enforceable against the Buyer and the
Subsidiary Minority Buyer in accordance with its terms. 

  
 24 

	15.4	The Buyer (for the purposes of this section 15.4 including the Subsidiary Minority Buyer) also represents and warrants to the Seller that that the Buyer is adequately
capitalized or has or will have on the Closing Date the funds available to pay the Purchase Price. 

  

	16.	Buyer’s Liability 

  

	16.1	In the event of a Buyer’s breach of the Buyer’s Representations and Warranties and/or in the event of the Buyer’s failure to fulfil its agreements or
obligations under this Agreement, the Buyer shall compensate the Seller from all Losses thereby suffered or incurred by the Seller. 

  

	17.	Term and termination 

This Agreement may be terminated prior to the Closing as follows: 

 

	 	a)	on 30 November 2011 or such later date as the Seller and the Buyer may agree, if the Closing shall not have occurred by the close of business on such date other
than through the fault of the Party seeking to terminate this Agreement; or 

  

	 	b)	by mutual written agreement between the Parties. 

  

	18.	Expenses 

 Each Party
shall cover its own costs, fees and expenses incurred in connection with the preparation, execution and enforcement of this Agreement, including, without limitation, any costs, fees and expenses owed or paid to any attorneys, brokers, accountants
and advisors. 
  

	19.	Confidentiality 

 The
content of this Agreement and information of any kind or nature whatsoever (whether orally or in writing) regarding financial information, trade secrets, know-how and other proprietary business information regarding the Company and the Subsidiary,
the Parties or their Affiliates shall be deemed to be confidential and proprietary (“Confidential Information”). 
 Each Party shall treat, and shall cause its officers, directors, employees, advisors and auditors to treat, such information as strictly confidential and shall not divulge or disclose (directly or
indirectly) such information to any other person or entity (other than to its officers, directors, employees, advisors and auditors who reasonably require access to such Confidential Information for the purpose for which it was disclosed), except
when (i) such disclosure is required by law, listing rules or by any order of any administrative or judicial authority which is (x) final and subject to no appeal or (y) executory pending any appeal although not final; (ii) such
information has become public through no fault of the receiving Party or by agreement between the Parties; (iii) such information has been obtained separately by the receiving Party from a third party that is not bound by any confidentiality
regarding such information; or (iv) such disclosure is to financial rating agencies. 

  
 25 

	20.	Notices 

 Any notice given
or made under or in connection with this Agreement shall be in writing, and shall be sent by courier or by 
 e-mail. 

The address of each Party for the purpose of this Agreement is as follows: 

To the Seller and/or the Subsidiary Minority Seller: 
 Sevan Marine ASA 
 Kittelsbuktveien 5 

4836 Arendal 

Norway 
 Att: CFO

 e-mail: lth@sevanmarine.com 
 To the Buyer and/or the Subsidiary Minority Buyer: 
 c/o Teekay Corporation

 Att.: Lars Ola Tan Almaas with copy to Vince Lok 
 Lars-Ola.Almaas@teekay.com Vince.Lok@teekay.com 
  

	21.	Entire Agreement 

  

	21.1	This Agreement supersedes and replaces all previous agreements, communication, statements etc. by or between the Parties related to the subject matter of this
Agreement, other than the Term Sheet. 

  

	22.	Announcement 

  

	22.1	No Party shall make any announcement or public statement relating to the subject matter of this Agreement except with the prior written consent of the other Parties and
the other Parties shall, prior to any announcement being made, be given the opportunity to comment upon the content of such announcement. 

  

	23.	Miscellaneous 

  

	23.1	The Seller shall not at any time assign or transfer this Agreement or any of its legal, beneficial or other rights, benefits and/or obligations under this Agreement
without the prior written consent of the Buyer. The Buyer shall be entitled to assign this Agreement or its legal, beneficial or other rights, benefits and/or obligations under this Agreement to an Affiliate without consent from Seller.

  
 26 

	23.2	Any amendments to this Agreement shall be in writing and shall be signed by the Parties. 

 

	23.3	It is the Buyer’s responsibility to consider whether or not the transfer of the Shares requires the approval of the Norwegian Competition Authority.

  

	23.4	This Agreement shall be governed by and construed in accordance with Norwegian law. 

 

	23.5	The Parties shall seek to solve any dispute arising out or relating to this Agreement amicably through negotiations. If the relevant Parties fail to solve such dispute,
controversy or claim by an amicable written agreement within thirty Business Days after such negotiations have been initiated by any of the Parties, such dispute, controversy or claim shall be finally settled by arbitration in Oslo in accordance
with the Norwegian Arbitration Act 2004. The arbitration panel shall consist of three arbitrators, out of which Seller and Buyer shall appoint one each, and the two arbitrators so appointed shall appoint the third who shall act as the chairperson of
the panel. The language to be used in the arbitration proceedings shall be English. The arbitration proceedings and arbitral award shall be confidential. 

  

	23.6	Any provision of this Agreement held to be invalid, illegal or unenforceable shall not affect the validity, legality or enforceability of the remaining provisions
hereof. The Parties shall endeavour in good faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions, the financial effect of which comes as close as possible to that of the invalid, illegal or
unenforceable provisions. 

 * * * 
 This Agreement is executed in three counterparts, each of which shall constitute an original. 
 * * * 

  
 27 

							
	For the Seller:	  		  	For the Buyer:	  	
				
	/s/ L.K. SAME	  		  	/s/ Lars Ola Tan Almaas	  	
	Authorised Signatory	  		  	Authorised Signatory	  	
	Name: L.K. SAME	  		  	Name: LARS OLA TAN ALMAAS	  	
	Title: ATTORNEY-IN-FACT	  		  	Title: ATTORNEY-IN-FACT	  	

 We hereby acknowledge and agree to our obligations set out in Clauses 15.3 and 15.4, which shall be binding on us as if
we were a Party to this Agreement. We further accept to be bound by the provisions set out in Clause 23.4 (regarding governing law) and 23.5 (regarding dispute resolution). Any notice sent to the Buyer in accordance with Clause 20 shall be deemed to
have been sent to us. 
  

					
	 For the Subsidiary Minority

Buyer:
	  		  	
			
	/s/ Lars Ola Tan Almaas	  		  	
	Authorised Signatory	  		  	
	Name: LARS OLA TAN ALMAAS	  		  	
	Title: ATTORNEY-IN-FACT	  		  	

  
 28Loan Agreement dated as of June 29, 2011

 Exhibit 4.5.7 

English translation of the Chinese original 
 ENTRUSTMENT LOAN AGREEMENT 
 (For Corporate Business) 

Serial No.: Xing Yin Shen Tian An Wei Jie Zi (2011) No. 0002 

 

									
	Entrustor: Shenzhen Nepstar Pharmaceutical Co., Ltd. (affixed with the corporate seal)

									
			
	Domicile:	 	  
	 	

									
			
	Legal Representative/Principal Officer:	 	  
	 	

									
					
	Contact Person:	 	  
	 	Title:	 	  
	 	

									
			
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	Telephone Number:	 	  
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	Lender: Shenzhen Tian’an Branch of Industrial Bank Co., Ltd. (the “ Industrial Bank”) 

									
			
	Domicile:	 	  
	 	

									
			
	Legal Representative/Principal Officer:	 	  
	 	

									
					
	Contact Person:	 	  
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	Borrower: Shenzhen Nepstar Information and Technology Service Co., Ltd. (affixed with the corporate seal)

									
			
	Domicile:	 	  
	 	

									
			
	Legal Representative/Principal Officer:	 	  
	 	

									
					
	Contact Person:	 	  
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 1 

 Place of Execution: Shenzhen Branch of Industrial Bank Co., Ltd. 

Industrial Bank Building, Futian District, Shenzhen 

  
 2 

 Important Reminder for Agreement Signing 

In order to protect your interest, please read through carefully, examine and confirm each of the following items prior to your signing of this
agreement: 
 I. You have the right to sign this agreement, and you have obtained all the authorizations necessary for your signing
hereof to the extent any such authorization of any person is required under any law; 
 II. You have carefully read and fully understood
the provisions in this agreement and have paid special attention to those provisions concerning the assumption or release of responsibilities and the limitations on the liabilities of the Industrial Bank, and the contents of those sections
highlighted in bold; 
 III. Both your company and you yourself have fully understood the meaning of, the corresponding legal
consequences that may arise from, and are willing to be bound by, the provisions in this agreement; 
 IV. The draft of this agreement
provided by the Industrial Bank is a form only. In that draft, there is a blank left after each relevant article, and at the end of the agreement, an article under the heading of “Supplementary Provisions” is inserted for the parties to
this agreement to make any amendments, additions or deletions; and 
 V. Where you have any question about this agreement, please consult
the Industrial Bank. 

  
 3 

 Pursuant to the Entrusted Loan Entrusment Agreement by and between the Entrustor and the Lender dated
June 29, 2011 numbered as Xing Yin Shen Tian An Wei Tuo Zi (2011) No. 0002, the Lender is entrusted by the Entrustor to disburse the Entrusted Loan (as defined below) to the Borrower. With a view to specifying the
responsibilities and to acting in good faith, in accordance with relevant laws and regulations of the People’s Republic of China (the “PRC”) and after negotiations on an equal footing, the parties hereto hereby enter into this
Entrustment Loan Agreement (this “Agreement”) for mutual observance. 
  

	Article 1	Definitions and Interpretation 

 Unless
otherwise agreed in writing among the parties hereto, when used in this Agreement, the following terms shall be defined and interpreted as follows: 
 1. “Entrustment Loan” means a loan that shall be disbursed by the Lender (i.e., the Entrustee) for and on behalf of the Entrustor to a specific person, for specific purposes, in a
specific amount, for a specific tenor and at a specific interest rate determined by the Entrustor from the funds provided by the Entrustor to the Lender, and shall be recovered with the assistance of the Lender. In connection with each Entrustment
Loan, the Lender shall receive the charges only and not take any risks in any form. 
 A “Loan” means a monetary amount disbursed to
the Borrower by the Lender hereunder upon the entrustment of the Entrustor. 
 A “Borrowing” means a monetary amount received by the
Borrower from the Lender after the Borrower’s request to the Lender for Borrowing is reviewed and approved by the Lender, in each case in accordance with this Agreement. 
 Each party hereto agrees and acknowledges that the monetary amount disbursed to the Borrower by the Lender hereunder shall be consistent to the monetary amount received by the Borrower from the Lender
hereunder. 
 2. “Loan Risks” includes without limitation, legal and policy risks, credit risks, market risks, operational
risks, force majeure risks and any other risks. 
 “Legal and Policy Risks” means the risks that any Entrusted Loan is rendered
unable to be recovered on time or both on time and in full as a result of any modification of or change in applicable laws or regulations of the People’s Republic of China. 
 “Credit Risks” means the risks arising from any failure of the Borrower to satisfy its obligations for repayment under this Agreement. 

“Market Risks” means the risks that any Entrusted Loan is rendered unable to be recovered on time or both in full and on time as a
result of any change in macro policies, economic cycle, market price or any other similar factors. 
 “Operational Risks” means
the risks that any Entrusted Loan is rendered unable to be recovered on time or both in full and on time as a result of any incomplete or problematic procedures or improper management actions in the course of the disbursement and management of such
Entrustment Loan. 

  
 4 

 “Force Majeure Risks” means the risks that any Entrusted Loan is rendered unable to be
recovered on time or both in full and on time as a result of the occurrence of any objective circumstances that are unforeseeable, unavoidable or insurmountable by either the Entrustor or the Entrustee. 

“Other Risks” means any other risks that may render any Entrusted Loan unable to be recovered on time or both in full and on time,
excluding those described above. 
 3. “Obligations” or “Master Obligations” means the RMB obligations
generated from the disbursement of any Loan to the Borrower (the debtor) by the Lender (the creditor) after having reviewed and approved the applicable request from the Borrower, including the principal amounts, interest, default interest, compound
interest, liquidated damages, indemnities and the Expenses for the Enforcement of the Obligations incurred by the Lender. 
 Each of the parties
hereto agrees and acknowledges that the Obligations of the Borrower towards the Lender under this Agreement shall be consistent to the debts of the Borrower owed to the Lender under this Agreement. 

4. “Expenses for the Enforcement of Obligations” includes without limitation, costs and expenses for litigations, arbitrations, property
preservation, applications for enforcement, attorney fees and expenses, public announcements, appraisals, verifications, auctions, realizations, telecommunications, travels and disposals. 
 5. “Workday” used herein means a business day of the Lender; where in the course of the performance of this Agreement, any drawdown date or repayment date falls on a date that is not a
business day of the Lender, the drawdown or repayment shall be put off till the immediately following business day of the Lender. 
  

	Article 2	Amount of the Borrowing 

 The Borrowing
under this Agreement shall be in an amount of RMB [insert currency] Fourteen Million One Hundred and Seventy Thousand only. 
  

	Article 3	Purposes of the Borrowing 

 The Borrowing
received hereunder shall be applied towards the funding of working capital requirements. Without prior written consent of the Entrustor, the Borrower may not apply any part of the Borrowing towards any other purpose. 

 

	Article 4	Tenor of the Borrowing 

 1. The tenor of
the Borrowing hereunder shall be 12 months, starting on June 29, 2011 and ending on June 29, 2012 (the “Tenor”). 
 2. Where the Loan is to be disbursed in a lump-sum, the date of actual disbursement as recorded on the receipt of borrowing and/or certificate of borrowing shall be deemed as the disbursement date. Where
the date of actual disbursement is later than the disbursement date so recorded, the Tenor shall be extended accordingly. 

  
 5 

 [N/A 3. Pursuant to the instructions of the Entrustor, the Borrowing shall be disbursed by installments
in accordance with the following schedule: 
  

			
	On              [insert the applicable date], RMB
             [insert the applicable amount];	  	On              [insert the applicable date], RMB
             [insert the applicable amount];
		
	On              [insert the applicable date], RMB
             [insert the applicable amount];	  	On              [insert the applicable date], RMB
             [insert the applicable amount];
		
	On              [insert the applicable date], RMB
             [insert the applicable amount];	  	On              [insert the applicable date], RMB
             [insert the applicable amount];

 The Lender shall transfer each of the relevant amounts as specified above to the account of the Borrower on each of
the dates as specified above.] 
 4. Where the Loan is to be utilized by installments, all the installments shall expire on the same day, or
in other words, all the installments disbursed separately shall expire simultaneously on the expiration date specified on the receipt of borrowing and/the certificate of borrowing for the first installment. 

5. In the event that the Lender accelerates the Loan under the circumstances set forth herein or in accordance with the instructions of the Entrustor, it
shall be deemed that expiration date of the Tenor is accelerated accordingly. 
  

	Article 5	Interest Rate and Payment of Interest 

 1.
Subject to the negotiations between the Entrustor and the Borrower, the interest shall accrue on the Borrowing at the interest rate set forth with Item (1) below (the “Interest Rate”): 

(1) a fixed rate equal to 0% per annum. In the event that prior to the date of each actual disbursement after the disbursement date recorded under
Article 4 above, there is any adjustment to the PRC base interest rate, the fixe interest rate shall be adjusted accordingly to be equal to the PRC base interest rate for one-year loans effective on the date of actual disbursement plus/minus
[NA]%, or in other words, the actual interest rate applicable to the Borrowing shall be equal to the PRC base interest rate for one-year loans effective on the date of actual disbursement of the Borrowing multiplied by a coefficient
of [N/A]. The Tenor shall not be adjusted due to any adjustment to the PRC base interest rate. 
 (2) a floating rate, which shall
be determined once every [NA] (month(s)/quarter(s)/half a year (each such period an “Interest Period”)), where, the interest rate per annum shall be the PRC base interest rate for one-year loans effective on the date of
actual disbursement plus/minus [NA]%, or in other words, the actual interest rate applicable to the Borrowing shall be equal to the PRC base interest rate for one-year loans effective on the date of actual disbursement of the Borrowing
multiplied by a coefficient of [N/A]. The interest rate for the initial Interest Period shall be equal to the PRC base interest rate for one-year loans effective on the date of actual disbursement multiplied by the coefficient
specified in the preceding sentence; and on the day falling                      (months/quarters/half a year) after the date of actual disbursement,
the interest rate for the next Interest Period shall be determined by multiplying the then effective PRC base interest rate of the corresponding tier and the coefficient specified in the preceding sentence. 

  
 6 

 In case of any adjustment to the PRC base interest rate during the Tenor, no notice will be given to the
Borrower. 
 (3) any other interest rate: [NA]. 
 2. Where the Borrowing is disbursed by installments, the interest rate applicable to each installment shall be determined by taking the PRC base interest rate for one-year loans effective on the date of
actual disbursement of such installment as the standard for calculation. 
 3. In the event that the PRC base interest rate is cancelled, the
Entrustor hereby authorizes the Lender to redetermine the Interest Rate in accordance with the applicable PRC policies concerning interest rate, by adhering to the principal of fairness and good faith and by reference to the industrial practice, the
status of the interest rate and any other similar factor. In case the Borrower has any disagreement thereon, it shall consult with the Entrustor. Where such disagreement fails to be resolved through such consultation, the Entrustor shall have the
right to accelerate the Loan and the Borrower shall immediately pay any and all the principal and accrued interest then outstanding. 
 4.
Manners of Payment of the Interest 
 The interest accrued on the Borrowing shall be paid in the manners set forth in Item N/A
below: 
 (1) it is agreed hereunder that the 20th day of each
                     [insert the applicable calendar month]/
                     [insert “the last month of each quarter”] shall be an interest settlement date (an Interest Settlement
Date”), and the Borrower shall pay the Lender the accrued interest for the current Interest Period on the day immediately after the Interest Settlement Date; provided, however, that the interest for the last Interest Period shall be paid on the
expiration date of the Tenor. 
 (2) all the interest accrued on the Borrowing shall be paid in a lump-sum on the expiration date of the Tenor.

 (3) any alternative manners for the payment of the interest
                    . 
 5. Default Interest
and Compound Interest 
 (1) In the event that the Borrower misappropriates any amount of the Borrowing for any purpose other than those
specified herein, the Entrustor hereby authorizes the Lender to charge compound interest on such amount so misappropriated at a default interest rate equal to the Interest Rate plus N/A%. In the event that the Borrower fails to repay
any amount of the Loan and fails to reach agreement with the Entrustor on the extension of the Tenor, and as result, such amount becomes delinquent, the Entrustor hereby authorizes the Lender to charge default interest on such delinquent amount at a
default interest rate equal to the Interest Rate plus N/A%. In the event that any interest accrued on the Loan fails to be paid on time, the Entrustor hereby authorizes the Lender to charge compound interest at the default interest
rate applicable to the delinquent amount specified above. 

  
 7 

 (2) Where the Interest Rate is a fixed rate, the default interest rate shall also be a fixed one; and
accordingly, where the Interest Rate is a floating rate, the default interest rate shall also be a floating one. The floating period of the default interest shall be consistent to that of the Interest Rate. 

(3) The default interest and the compound interest shall be calculated and collected in the same way as the regular interest on the Loan set forth
herein. 
  

	Article 6	Repayment of the Principal 

 1. The
principal of the Borrowing hereunder shall be repaid in the manners set forth in Item (A) below: 
 (A) The principal of the Borrowing
shall be repaid in a lump-sum on the expiration date of the Tenor. 
 (B) The principal of the Borrowing shall be repaid by installments in
accordance with the following repayment schedule: 
  

			
	On              [insert the applicable date], RMB
             [insert the applicable amount];	  	On              [insert the applicable date], RMB
             [insert the applicable amount];
	On              [insert the applicable date], RMB
             [insert the applicable amount];	  	On              [insert the applicable date], RMB
             [insert the applicable amount];
	On              [insert the applicable date], RMB
             [insert the applicable amount];	  	On              [insert the applicable date], RMB
             [insert the applicable amount];

 (C) Any alternative manners for the repayment of the principal:
                    . 
 2. On each
repayment date and Interest Settlement Date specified in this Agreement, the Borrower shall punctually and in full, repay the principal of and the accrued interest on any amount of the Borrowing received hereunder. In the event that the Borrower
fails to repay punctually any principal of or interest on any amount of the Borrowing, the Lender shall have the right to debit from any account of the Borrower maintained with the Lender or any organization within the system of the Lender the
necessary amount in satisfaction of the fees, expenses, principal and interest due from the Borrower in accordance with the applicable regulations concerning banking accounting and in the order stipulated in the internal rules of the Lender.

 3. Where a repayment date falls on a date that is not a business day of the Lender, the repayment shall be put off till the immediately
following business day of the Lender; provided, however, that such date that is not a business day shall be included into the number of days during which the Loan is actually occupied. At the repayment of the last amount of the principal of the
Borrowing, any and all the accrued interest that remains outstanding by then shall be paid simultaneously, regardless of the provisions concerning the Interest Settlement Date set forth in Article 5 above. 

4. Subject to the review and consent of the Entrustor, the Borrower may prepay the whole or any part of the principal of the Entrusted Loan. 

  
 8 

	Article 7	Handling Charges 

 1. The Lender shall
receive handling charges equal to 1‰ of the amount of the Entrusted Loan. The handling charges shall be paid by the Borrower (Entrustor/Borrower) in a lump-sum prior to the disbursement of the Borrowing. 

2. Where the handling charges are to be paid by the Entrustor, the Entrustee shall be entitled to debit the same directly from any account of the
Entrustor. Where the handling charges are to be paid by the Borrower, the Entrustor shall be responsible for urging the Borrower to pay the same on time, and shall agree to pay the same on behalf of the Borrower where the Borrower fails to pay the
same on time, in which case, the Entrustee shall be entitled to debit the same directly from any account of the Entrustor. 
  

	Article 8	Security 

 [N/A 1. The borrowing
contemplated hereunder shall be guaranteed by the security to be provided by the guarantors acceptable to the Entrustor under the following security agreement(s): 
 (1) the                      [insert name of the security agreement] numbered as
                    , under which the security is provided in the form of
                    , and the guarantor is
                    ; 
 (2) the
                     [insert name of the security agreement] numbered as
                    , under which the security is provided in the form of
                    , and the guarantor is
                    ; and 
 (3) the
                     [insert name of the security agreement] numbered as
                    , under which the security is provided in the form of
                    , and the guarantor is
                    .] 
 2. Until the
execution and effectiveness of each and all the security agreements hereunder and the completion of all the required procedures for the perfection of the security created thereunder, the Lender shall have the right to withhold the performance of
such obligations as for the disbursement of the Loan. 
  

	Article 9	Representations and Undertakings of the Borrower 

 The Borrower hereby voluntarily makes the following representations and undertakings and will assume the legal liabilities for the truth thereof: 
 1. The Borrower is a legal entity established and validly existing under the laws of the PRC, and has the full capacity for civil conduct. The Borrower undertakes that it will, at the request of the
Entrustor or the Lender, provide the relevant certificates, permits and licenses as well as any other documents as requested by the Entrustor or the Lender from time to time. 
 2. The Borrower has the full power to perform all its obligations and responsibilities under this Agreement, and its liabilities for repayment hereunder will not be relieved or released as a result of any
order, any change of its financial status, or any agreement with any person. 

  
 9 

 3. The Borrower has the full power, authorization and legal right to execute this Agreement, and has
obtained or completed (i) any and all the internal corporate approvals, authorizations and any other relevant procedures, and (ii) any and all the approvals, registrations, authorizations, consents, permits and any other relevant
procedures from or with any required governmental or regulatory authorities necessary for its execution and performance of this Agreement, and all such approvals, registrations, authorizations, consents, permits and any other relevant procedures are
in full legal force and effect. 
 4. The execution of this Agreement by the Borrower fully complies with the relevant articles of association,
internal decisions, or shareholder or board resolutions of the Borrower. This Agreement does not conflict with or violate any of the articles of association, internal decisions, shareholder or board resolutions or policies of the Borrower.

 5. The execution and performance of this Agreement are based on the expression of the real intentions of the Borrower. The execution and the
performance of this Agreement do not violate any provision of any law, regulation, rule or contract by which the Borrower is bound. This Agreement is legal, valid and enforceable. The Borrower shall, promptly and on an unconditional basis, indemnify
the Entrustor and the Lender against any and all the losses arising from the invalidity of this Agreement due to any flaw in the right of the Borrower to the execution and performance of this Agreement. 

6. Any and all the documents, financial statements and other materials provided by the Borrower to the Entrustor or the Lender hereunder are true,
complete, accurate and effective, and the Borrower will maintain all the financial indices required by the Entrustor of the Lender. 
 7. The
Borrower agrees that the borrowing contemplated hereunder shall be bound by the rules and customary practice of the Lender, which shall be subject to the interpretation of the Lender. 
 8. In the event that the Borrower fails to perform any of the Obligations hereunder, it hereby authorizes the Lender to debit directly the corresponding amount from any account of the Borrower maintained
with the Lender or any organization within the system of the Lender. 
 9. No matter at what stage of the transaction after the execution of
this Agreement, where the Borrower submits to the Lender for review and approval of any document relating to any specific transaction, the Borrower shall ensure the truth of all such documents. The Lender will make a decision on the apparent truth
of any transaction documents, not participate in or know the substance of any specific transaction conducted by the Borrower, and not assume any liabilities therefor. 

  
 10 

 10. The Borrower hereby acknowledges that other than those disclosed to the Entrustor or the Lender, the
Borrower does not know any of the following circumstances, whether pending or threatened, which may result in the Entrustor or the Lender refusing to disburse the Borrowing hereunder: 
 (1) any obligations or contingent liabilities to which the Borrower is subject, including without limitation, any mortgage, pledge, lien or any other encumbrance created on any assets or income of the
Borrower that has not been disclosed to the Lender; 
 (2) any material noncompliance of discipline, violation of law, or claim involving the
Borrower or any of its senior officers; 
 (3) any default by the Borrower under any agreement between the Borrower and any of its other
creditors relating to obligations or creditor rights; 
 (4) there has not occurred and does not exist any litigation, arbitration or
administrative proceedings pending, or to the knowledge of the Borrower threatened, against the Borrower or any of its assets, and the Borrower is not subject to any liquidation or winding-up or any other similar proceedings by or against the
Borrower; or 
 (5) Any other circumstances which may have an adverse effect on the Borrower’s financial status or ability to repay debts.

 11. The Borrower hereby undertakes that it will apply the Borrowing towards the purposes specified herein, not misappropriate nor will it
allow any amount of the Borrowing to be applied towards any purpose in violation of the intent of this Agreement. The Borrower shall subject itself to and cooperate with the Entrustor or the Lender in the supervision, inspection and check by the
Entrustor or the Lender from time to time on the utilization of the Borrowing, the operational and financial activities, inventory, assets and liabilities, bank deposits and cash on hand of the Borrower, or any other requirement deemed necessary or
advisable by the Entrustor or the Lender. 
 12. The Borrower shall provide adequate and valid security or any other security deemed appropriate
or acceptable by the Entrustor. 
 13. The Borrower may not allow its registered capital to be reduced in any way. Without prior written consent
of the Entrustor, the Borrower may not transfer its obligations hereunder to any third party, whether in whole or in part. Prior to the full satisfaction of all its obligations hereunder, the Borrower may not satisfy any of its obligations owed to
any of its creditors prior to the same falling due. 
 14. In the event that the Lender is involved in any dispute between the Borrower and any
third party as a result of any litigation or arbitration or any other dispute between the Lender and the Borrower or any third party related to the Borrower due to the Lender’s performance of its obligations hereunder, the Borrower shall
indemnify the Lender against any and all the litigation or arbitration costs and expenses, attorney fees, and any other costs and expenses paid by the Lender in connection therewith. 
 15. The Borrower shall conduct all the settlement business arising under this Agreement through a settlement account opened by it with the Lender. 

 

	Article 10	Other Rights and Obligations 

  

	1.	The Entrustor shall transfer the entrusted funds into its account for entrustment loans on a timely basis. The Lender will not commence disbursement procedures in
accordance with the entrustment loan agreement and the loan contract etc. until the entrusted funds of the Entrustor have been deposited into its account for entrustment loans. 

  
 11 

	2.	The funds for Entrustment Loan shall be obtained from legitimate sources and may not be credit-extending fund obtained from the Lender; otherwise the Entrustor shall
bear legal liability correspondingly. 

  

	3.	The Entrustor and the Borrower shall provide true materials, including, without limitation, documents, statements and certificates, required by the Lender.

  

	4.	The Borrower shall repay the principal of the Entrustment Loan and interest accrued thereon in the same currency as that of the Borrowing, unless otherwise agreed by
the Entrustor and the Borrower. 

  

	5.	The Entrustor shall be responsible for any pre-loan-extending investigation on the Borrower, the surety or the collaterals and make determination upon the Borrower and
the surety or the collaterals after necessary analysis and evaluation. The scope of investigation shall include, without limitation, the purpose of the loan, basic information, credit standing, financial condition of the Borrower and the surety and
any other things required to be investigated. 

  

	6.	The Entrustor shall review the conditions for disbursement of the Entrustment Loan. Once the Loan is disbursed by the Lender, it shall be deemed that the Borrowing
shall have satisfied all the conditions for disbursement required by the Entrustor. 

  

	7.	The Entrustor shall be responsible for the collection of the Entrustment Loan, inspection of the use of the Entrustment Loan, understanding the operating activities and
financial condition of the Borrower as well as any disputes and security in relation to any indebtedness of the Borrower. 

  

	8.	Each of the Entrustor and the Lender shall have the right to monitor the use of the Borrowing by the Borrower. 

 

	9.	The Entrustor shall be entitled to take measures, such as litigation or arbitration, in accordance with applicable law or this Agreement, to recover the principal and
interest of the Loan, and the Lender shall give any assistance required for therefor. 

  

	10.	The Borrower hereby irrevocably authorizes the Lender to debit from the bank account of the Borrower for repayment of the principal of the Entrustment Loan and the
interest accrued thereon. 

  

	11.	If the Borrower fails to repay any principal of the Loan or any interest accrued thereon as agreed under this Agreement, the Entrustor shall assume any Loan Risks in
relation to the Entrustment Loan, and shall not require the Lender to assume any liability for reasons that the Lender fails to perform appropriate supervision, fails to promptly notify the Entrustor of any delay in repayment or any other reasons.
Any dispute between the Entrustor and the Borrower shall be irrelevant to the Lender. 

  

	12.	Unless otherwise agreed by the parties hereto, neither the Entrustor nor the Borrower may require the Lender to assume any other obligations or risks.

  
 12 

	13.	Where the Entrustor authorizes the Lender to initiate a lawsuit or arbitration on its behalf, it shall advance to the Lender the Expenses for the Enforcement of
Obligations, including, without limitation, fees in relation to litigation, arbitration, asset preservation, application for enforcement, announcement, appraisal, evaluation, auction, sale, communication, travel and accommodation and disposal, as
well as attorney’s fee. 

  

	Article 11	Acceleration of Loan 

 1. During the tenor
of the Borrowing, if the Borrower or the surety (i.e., the guarantor or the mortgagor under this Agreement) commits any of the following, the Entrustor shall have the right to cease any disbursement of any amount under this Agreement that has not
been disbursed, and accelerate all or portion of the principal and interest of the Loan. Where the Borrowing is repaid in installments and the Entrustor accelerates any one of the installments in accordance with this Agreement, all the other
installments that have not become due may be deemed due and payable: 
 (1) It provides any false materials or conceals any material operating
or financial matters, or any certificate or document submitted to the Entrustor or the Lender or any representations or warranties under Article 9 of this Agreement is proved to be untrue, inaccurate, incomplete or willful misleading; 

(2) It changes the scheduled purpose of the Borrowing without consent of the Entrustor , or misappropriates any Borrowing or use any Borrowing in any
illegal or non-compliant transactions; 
 (3) It refuses to accept any supervision or inspection of the Entrustor or the Lender on its use of
the loan proceeds and the relevant operating or financial activities; 
 (4) It carries out any significant merger, acquisition or
restructuring, which, in the view of the Entrustor, may affect the repayment of the Borrowing; 
 (5) It intentionally evades from or
invalidating any debt through related party transactions; 
 (6) Its credit standing deteriorates and it ability to repay any indebtedness,
including any contingent liability, apparently weakens; 
 (7) The Borrower fails to repay any principals and interest of or any expenses
relating to any Borrowing when they become due and payable; 
 (8) The Borrower ceases repayment of its indebtedness or is unable to or indicate
that it is unable to repay any indebtedness due and payable; 
 (9) The Borrower stops production, ceases its business, is declared bankrupt,
dissolves, is cancelled, is involved in any material economic dispute or its financial condition deteriorates or its business license is revoked; 
 (10) The Borrower fails to perform any of its obligations under Article 10 or any other obligations under this Agreement, or the surety fails to perform its obligations under the security agreement;

  
 13 

 (11) The value of any assets subject to mortgage or pledge decreases or potentially decreases, or the right
of pledge requires to be enforced prior to the date the Borrowing becomes due and payable; and 
 (12) any other events that adversely affect or
damage or potentially adversely affect or damage any rights or interests of the Entrustor or the Lender. 
 2. In the event of acceleration of
the Loan, the Entrustor shall be entitled to take appropriate measures under Article 12.1 and Article 12.5. 
  

	Article 12	Default Liability 

 1. If the Borrower is
in breach of any provision under this Agreement or the Lender is unable to perform its obligation due to any reason attributable to the Borrower, the Borrower shall bear the following liability for its breach of Agreement to the Entrustor:

 (1) if the Entrustment Loan has not been disbursed, the Entrustor shall have the right to terminate this Agreement and cease disbursement of
the Entrustment Loan; 
 (2) if the Entrustment Loan has not become due, the Entrustor shall have the right to terminate this Agreement and
accelerate the principal and interest of the Entrustment Loan; 
 (3) if the Entrustment Loan has become overdue, the Entrustor shall have be
entitled to overdue penalty interest; 
 (4) if the Borrower misappropriates the Entrustment Loan, the Entrustor shall be entitled to penalty
interest for the misappropriation; 
 (5) the Entrustor shall be entitled to take actions to enforce the obligations of the Borrower hereunder,
and any fees and expenses in connection with such enforcement shall be born by the Borrower; and 
 (6) the Entrustor shall have the right to
require the Borrower to indemnify it against any other economic loss. 
 2. If the Entrustor breaches this Agreement or the Lender is unable to
perform its obligation due to any reason attributable to the Entrustor, the Entrustor shall bear the following liability to the Borrower: 
 (1)
if the Entrustment Loan fails to be disbursed on time, the Entrustor shall disburse the Entrustment Loan as soon as possible; and 
 (2) the
Entrustor shall indemnify the Borrower against any economic losses. 
 3. If the Lender breaches this Agreement, the Lender shall indemnify the
Entrustor or the Borrower, as the case may be, against its economic losses in accordance with law. 

  
 14 

 4. [N/A] If the Entrustor/the Borrower fails to timely pay any handling charge, the Lender shall be
entitled to liquidated damages on a daily basis in an amount equal to     % of any unpaid handling charge. 
 The Entrustee
shall be entitled to debit from the account of the Entrustor for satisfaction of any liquidated damages required to be paid by the Entrustor. The Entrustor shall be responsible for procuring the Borrower to pay any liquidated damages owed by the
Borrower. If the Borrower fails to duly pay the liquidated damages, the Entrustor agrees to make such payment on behalf of the Borrower, and the Entrustee shall be entitled to debit from the account of the Entrustor. 

5. In the event that the surety under this Agreement (i.e., the guarantor, mortgagor or pledgor) incurs any of the following events, the Entrustor shall
have the right to take measures under 12.1: 
 (1) The guarantor fails to perform its obligations under the applicable guarantee agreement, or
its credit standing deteriorates, or it incurs any other events that weaken its ability of guarantee; 
 (2) The mortgagor fails to perform its
obligations under the applicable mortgage agreement, or intentionally damages or destroys the mortgaged assets, or the value of the mortgaged assets apparently decreases or may decrease, or it incurs any other events that prejudice the mortgage
rights of the Lender; or 
 (3) The pledgor fails to perform its obligations under the applicable pledge agreement, or the value of the pledged
assets apparently decreases or may decrease, or the right of pledge has to be enforced prior to the satisfaction of the Borrowing, or it incurs any other events that prejudice the right of pledge of the Lender. 

 

	Article 13	Continuity of Obligations 

 All
obligations of the Borrower under this Agreement shall be continuous and shall have full and equal binding effect on its successor, agent, receiver, assigns and surviving entity. 

 

	Article 14	Right to Set Off 

 In the case that the
Borrower or the surety fails to perform its liabilities or breaches its obligations under this Agreement which results in acceleration of its liabilities hereunder, the Lender shall have the right to debit from any account of the Borrower opened
with the Lender for repayment. If the currency under such account of the Borrower is different from the currency of the principal liabilities, it shall be converted at the buying rate published by the Lender on the date of debit. 

 

	Article 15	Extension of the Tenor 

 1. The Borrower
may request for extension of the tenor upon the expiration of the Entrustment Loan. 

  
 15 

 2. The Borrower shall submit written application for extension to the Lender thirty Workdays prior to the
expiration of the Entrustment Loan, provided that the application shall be approved by the Entrustor and the surety in writing. 
 3. If the
Entrustor approves the extension, the Lender shall enter into a supplemental agreement for the extension of the Entrustment Loan with the Borrower, the Entrustor and the surety. If the Entrustor refuses to approve the extension, the Borrower shall
perform its obligations hereunder in accordance with this Agreement. 
  

	Article 16	Governing Law, Jurisdiction and Dispute Resolution 

 1. This Agreement shall be governed by and construed in accordance with the PRC law, and any dispute in connection with this Agreement shall be solved in accordance with the PRC law. 

2. In the case of any controversy or dispute in connection herewith in the performance of this Agreement, it may be solved through negotiation. If such
negotiation fails, it shall be solved in accordance with the second method set forth below: 
 (1) to institute legal proceedings before the
court at the place of execution of this Agreement; 
 (2) to refer to Shenzhen Arbitration Commission for it to arbitrate under its then
effective arbitration rules. The arbitration is final and binding on all the parties involved. 
 (3) other measures:
                                        

 3. During litigation or arbitration, the terms that are not subject to dispute shall continue to be performed, and the Borrower shall not
refuse to perform any other obligations under this Agreement due to such litigation or arbitration. 
  

	Article 17	Correspondence, Communications and Notification 

 1. Any correspondence, communications and notification under this Agreement shall be made in writing and sent to the other party at the address or telex number listed on the cover page of this Agreement,
or by other means. 
 2. If any of the contact information of either party changes, it shall notify the other parties without any delay by any
instant method. If it fails to promptly notify the other parties and the other parties send any document, communications or notifications in accordance with the original contact information, any consequences resulting therefrom shall be borne by the
party who fails to make such prompt notification. 
 3. If any document, communication or notification is sent at the above address, it shall be
deemed delivered: 
 (1) if sent by mail, five Workdays after it is deposited with a post office by registered mail; 

(2) if sent by telex when transmission is completed and an answerback showing successful transmission is received; or 

  
 16 

 (3) if delivered in person when the addressee receives it. 

4. The parties agrees that the corporate seal, office seal, finance specific seal, contract specific seal, sending and receiving acknowledgement seal and
the loan specific seal of the Lender shall be valid seals for the correspondence, communication and notification among the parties. All the staff of the Entrustor and the Borrower shall be the authorized persons to sign on and receive the
correspondence, communication and notification sent to and from the other party. 
  

	Article 18	Effectiveness and Miscellaneous 

 1. This
Agreement shall become effective upon execution or seal by the parties hereto. 
 2. During the term of this Agreement, any grace, extension or
delay given by the Entrustor to the Borrower and the surety in the exercise of its rights or interests under this Agreement shall neither prejudice, affect or limit any and all rights or interests of the Entrustor under applicable law and this
Agreement, nor be deemed waiver by the Entrustor of any rights or interests under this Agreement, and nor affect any obligations of the Borrower under this Agreement. 
 3. If, at any time, any term of this Agreement becomes illegal, invalid or unenforceable in any respect, the legality, validity or enforceability of any other terms of this Agreement shall not be affected
or prejudiced. 
 4. Headings are included for convenience only and shall not be used for the construction of any provision of this Agreement or
any other purposes. 
 5. The exhibits hereto shall be an integral part of this Agreement and shall have the same legal effect as this
Agreement. 
 6. This Agreement shall be executed in four counterparts, with each of the Entrustor, the Lender and the Borrower holding one and
each counterpart shall have the same legal effect. 
  

	Article 19	Notarization and Voluntary Submission to Enforcement 

 1. If the Entrustor or the Lender requires this Agreement to be notarized, it shall be notarized by a notary public authorized by the relevant authority. 

2. This Agreement after being notarized is capable of being enforced. Where the Borrower fails to perform its liabilities hereunder or in the case of any
circumstances agreed hereunder under which the Entrustor or the Lender can enforce its rights, the Entrustor or the Lender shall have the right to apply for enforcement to the court with jurisdiction. 

 

	Article 20	Supplementary Provisions 

  

			
	  
	  	

  
 17 

			
		  	Shenzhen Nepstar Pharmaceutical Co., Ltd. (affixed with the corporate seal)
	Entrustor	  	 Seal: /s/ Shenzhen Nepstar Pharmaceutical Co., Ltd.

		
		  	Dated June 29, 2011
		
		  	Shenzhen Tian’an Branch of Industrial Bank Co., Ltd. (affixed with the corporate seal)
	Lender	  	 Seal: /s/ Shenzhen Tian’an Branch of Industrial Bank Co., Ltd.

		
		  	Dated June 29, 2011
		
		  	Shenzhen Nepstar Information and Technology Service Co., Ltd. (affixed with the corporate seal)
	Borrower	  	Seal: /s/ Shenzhen Nepstar Information and Technology Service Co., Ltd.
		
		  	Dated June 29, 2011

  
 18

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