Document:

Exhibit 10.43

 

English Translation

 

SHARE SUBSCRIPTION AGREEMENT

 

between

 

Suning Commerce Group Co., Ltd.

 

and

 

Taobao (China) Software Co., Ltd.

 

Date: 9 August 2015

 

 

Table of Contents

 

	
RECITALS:
    	
 
    	
2
    
	
 
    	
 
    	
 
    
	
ARTICLE I
    	
DEFINITIONS
    	
2
    
	
 
    	
 
    	
 
    
	
ARTICLE II
    	
PRIVATE PLACEMENT AND SHARE SUBSCRIPTION
    	
8
    
	
 
    	
 
    	
 
    
	
ARTICLE III
    	
PAYMENT OF SHARE SUBSCRIPTION PRICE AND   COMPLETION OF NEW SHARES ISSUANCE
    	
9
    
	
 
    	
 
    	
 
    
	
ARTICLE IV
    	
REPRESENTATIONS AND WARRANTIES OF COMPANY
    	
11
    
	
 
    	
 
    	
 
    
	
ARTICLE V
    	
REPRESENTATIONS AND WARRANTIES OF SUBSCRIBER
    	
12
    
	
 
    	
 
    	
 
    
	
ARTICLE VI
    	
COVENANTS
    	
12
    
	
 
    	
 
    	
 
    
	
ARTICLE VII
    	
RIGHTS OF SUBSCRIBER AS INVESTOR
    	
17
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII
    	
INDEMNIFICATION
    	
18
    
	
 
    	
 
    	
 
    
	
ARTICLE IX
    	
EFFECTIVENESS AND TERMINATION
    	
19
    
	
 
    	
 
    	
 
    
	
ARTICLE X
    	
MISCELLANEOUS
    	
21
    
	
 
    	
 
    	
 
    
	
APPENDIX I
    	
 
    	
27
    
	
 
    	
 
    	
 
    
	
APPENDIX II
    	
 
    	
29
    
	
 
    	
 
    	
 
    
	
APPENDIX III
    	
 
    	
31
    
	
 
    	
 
    	
 
    
	
EXHIBIT 4
    	
 
    	
33
    
	
 
    	
 
    	
 
    
	
EXHIBIT 5
    	
 
    	
38
    

 

i

 

Share Subscription Agreement

 

This Share Subscription Agreement (this “Agreement”) is entered into on 9 August 2015 in Shanghai, PRC by and between:

 

(A)                               Suning Commerce Group Co., Ltd. (the “Company”), a company limited by shares organized and existing under the PRC Laws, with its domicile at 1-5/F, Jinshan Building, No.8 Shanxi Road, Nanjing, Jiangsu Province; and

 

(B)                               Taobao (China) Software Co., Ltd. (the “Subscriber”), a limited liability company organized and existing under the PRC Laws, with its domicile at Jingfeng Village, Wuchang Sub-district, Yuhang District, Hangzhou.

 

The parties to this Agreement may be collectively referred to as the “Parties” and individually a “Party” in this Agreement.

 

RECITALS:

 

WHEREAS, the Company is a company limited by shares organized and existing under the PRC Laws, and the RMB ordinary shares issued by it have been listed on the Shenzhen Stock Exchange (“SZSE”) (with its stock abbreviation being “Suning Commerce” and its ticker symbol being “002024”).

 

WHEREAS, the Company intends to make private placement of RMB ordinary shares (“New Shares”) to the Subscriber, and the Subscriber intends to subscribe for such New Shares, and the number of the New Shares accounts for nineteen point ninety-nine percent (19.99%) of the total share capital of the Company immediately after the completion of this Issuance.  The face value per each New Share is RMB 1.00, which is denominated in RMB.  The Subscriber intends to subscribe for the New Shares in cash in RMB.

 

WHEREAS, the Company intends to subscribe for the Alibaba shares issued to it by Alibaba Group Holding Limited (“Alibaba”, a company listed on the New York Stock Exchange, with its stock abbreviation being “BABA”) (the “Alibaba Share Subscription Transaction”).

 

WHEREAS, the affiliates of the Subscriber and the Company have executed the Business Cooperation Framework Agreement with respect to business cooperation (the “Business Cooperation Framework Agreement”) on 9 August 2015.

 

Therefore, in consideration of the aforesaid statement of facts and the mutual agreements and covenants contained below in this Agreement, the Parties agree as follows:

 

ARTICLE I                                                     DEFINITIONS

 

SECTION 1.01        Defined Terms

 

 

In this Agreement, unless otherwise defined in the context, the following terms shall have the following meaning:

 

“Real Property” means all of the land (use right), buildings, constructions, structures or the fixtures thereon and all other attachments thereto.

 

“Laws” means laws, regulations, rules and directives of the PRC or any country other than the PRC, or provincial, local or similar laws, regulations, rules and directives.

 

“Encumbrance” means any security interest, pledge, mortgage, lien (including right of priority for taxation, right of revocation and subrogation right), lease, license, indebtedness, preferential arrangements, claims, defects, restrictive covenants, conditions or any kind of restrictions, including any restriction on the use, ownership, voting, transfer, profiting or exercise of any other ownership interest, the right of first refusal or the pre-emptive right.

 

“Indebtedness” means all debts, liabilities and obligations, whether or not cumulated or fixed, absolute or contingent, matured or undue, vested or unvested, including the debts, liabilities and obligations which may be incurred under any Law, Demand or Government Order and under any contract, agreement, arrangement, covenant or undertaking.

 

“AIC” means the State Administration for Industry & Commerce of the PRC or local administrations for industry and commerce (as the case may be) or any of their successors.

 

“Knowledge of the Company” means the actual knowledge of the directors, supervisors and senior executives of the Company.

 

“External Representative of the Company” means the Person other than the directors, senior management personnel and employees of the Group Member that acts on behalf of any of the Group Members.

 

“Working Day” means any day other than Saturday, Sunday and public holidays in the PRC or Hong Kong as provided for by the Law.

 

“Affiliate” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by or under common control with such Person, or with respect to a natural person, also includes any of his/her lineal relatives.  For such purpose, “Control” means the possession of the power to directly or indirectly determine the management and policies of another Person through holding of voting securities, or by contract or otherwise.

 

“Group Member” means the Company and any or all of the members within all Persons in which the Company holds more than 50% of the equity interest or which are controlled directly or indirectly by the Company.

 

“RMB” means the legal currency of the PRC.

 

“Trade Secrets” means trade secrets, know-how, and other confidential or proprietary technology, business and other materials, including the technology and know-how for manufacturing and production, research and development materials, techniques, drawings,

 

 

specifications, designs, planning, plans, technical data, financial, marketing and business data, pricing and cost data, business and marketing plans, customers and suppliers list and information, as well as all rights to restrict the use of or disclose all of the foregoing in any jurisdiction.

 

“Taxes” means any and all taxes, fees, levies, impositions, customs duties and other charges of any type (together with any and all interest, fines, additional taxes and additional sums collected therefor) levied by any Government Authority (including without limitation the tax authority), including the taxes or other fees levied on revenues, franchise, incidental income or other profits, gross income, properties, sales, use, salaries, employment, social security, unemployment compensation or net value; taxes or other fees which in nature are excise tax, withholding tax, transfer tax, stamp tax, deed tax, value-added tax or business tax; charges for licenses, registrations and documents; as well as customs duties, taxes and similar charges.

 

“Demand” means any claim, lawsuit, complaint, appeal, arbitration, settlement, adjudication, inquiry, investigation or other procedures instituted by or against any Person.

 

“Business” means the business which is currently conducted and to be conducted in future by each Group Member.

 

“Government Authority” means governmental, regulatory or administrative department, organ or committee or any court, tribunal or judicial or arbitral body.

 

“Government Official” means any official, employee or public employee of any Government Authority.

 

“Government Order” means any order, writ, judgment, injunction, ruling, adjudication, regulation or decision made by any Government Authority or jointly with any other Government Authority.

 

“Government Approval” means any consent, approval, authorization, waiver, permission, franchise, license, certificate, exemption, registration, filing, report or notice granted or made by any Government Authority.

 

“CSRC” means the China Securities Regulatory Commission.

 

“Intellectual Property” means (i) all patents, (ii) trademarks, service marks, trade names, trade dress and domain names, and the goodwill exclusive thereto, (iii) copyright, including the copyright for computer software and the copyright for database, (iv) confidential and proprietary information, including Trade Secrets and know-how, (v) any right similar to Items (i) to (iv) provided in any Law, and (vi) the registration and registration application for any of the foregoing, regardless of whether any of the foregoing has been registered, whether an application has been filed for registering any of the foregoing, or whether no registered is required for any of the foregoing.

 

“Material Adverse Effect” means any material adverse effect on the business, properties, financial position, assets or operating results of the Group Member (in its entirety);

 

 

however, in no event shall any of the exceptions set forth below, whether individually or jointly with other exceptions set forth below, be deemed to constitute material adverse effect, nor shall they be taken into consideration when determining whether any material adverse effect occurs: (i) any effect arising from the announcement, pending status or completion of the transaction contemplated in this Agreement or the Alibaba Share Subscription Transaction, or the compliance of the terms and conditions of this Agreement, Alibaba Group Share Subscription Transaction, (ii) any effect arising from the change that generally affects any main industry that is engaged in by the Group Member, (iii) any effect arising from the change of the general economic, financial, credit or securities market conditions which would affect China, the US or the whole world, including change of interest rate or exchange rate, (iv) any plague, earthquake, typhoon, tornado or other natural disasters, declaration of war, terrorist act, armed conflict or other similar force majeure event, (v) change of the accounting standards or any interpretations thereof which would be applicable to the Group Member, or the change of any applicable Law or any interpretation or enforcement thereof, (vi) any act or omission performed at the request of the Subscriber or with prior consent of the Subscriber, (vii) failure to achieve any internal or public forecast, estimate or guidance; however, the basic reason for failure to reach any internal or public forecast, estimate or guidance set forth in Item (vii) may be taken into consideration when determining whether any material adverse effect occurs, or (viii) any change of the Company’s stock price or trading volume; however, the basic reason for the change of the Company’s stock price or trading volume may be taken into consideration when determining whether any material adverse effect occurs; furthermore, with respect to Items (ii), (iii) and (v), such change, in respect of the Group Member (in its entirety), and other companies of similar size in any main industry in which the Group Member is engaged, has no materially disproportionate adverse effect.

 

“Material Contract” means the contracts and agreements entered into by the Group Member and disclosed as required by Chapter IX “Transactions Required to be Disclosed” in the Stock Listing Rules of the Shenzhen Stock Exchange (Revised in 2014).

 

“PRC” means the Peoples’ Republic of China, excluding only for the purpose of this Agreement Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan.

 

“PRC GAAP” means the generally accepted accounting principles which are consistently applied during the whole applicable period and which are valid in the PRC, including the Enterprise Accounting System issued by the Ministry of Finance of the PRC and other applicable enterprise accounting standards and rules.

 

“CSDCC” means China Securities Depository and Clearing Company Limited Shenzhen Branch.

 

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

 

“Major Group Member” means, among the Group Members, all of the Group Members of which the total assets, net assets or revenues account for more than five percent (5%)

 

 

of the consolidated total assets, net assets or revenues of the Company for the latest complete financial year, except LAOX Co., Ltd.

 

“Leased Real Property” means the real property leased by any Group Member and all easements, permits, rights and attachments thereto.

 

“Transfer” means, with respect to any securities, to directly or indirectly transfer, sell, assign, pledge, mortgage, create security interest on or separately dispose of, or create or permit the creation of any encumbrance on such securities.

 

SECTION 1.02        Definitions

 

The following terms have the meaning set forth in the Sections set forth below:

 

	
Definition
    	
 
    	
Location
    
	
 
    	
 
    	
 
    
	
“Alibaba”
    	
 
    	
Recitals
    
	
 
    	
 
    	
 
    
	
“Alibaba Share   Subscription Transaction”
    	
 
    	
Recitals
    
	
 
    	
 
    	
 
    
	
“Confidential Information”
    	
 
    	
Section 6.09(a)
    
	
 
    	
 
    	
 
    
	
“this Issuance”
    	
 
    	
Section 2.01(a)
    
	
 
    	
 
    	
 
    
	
“this Agreement”
    	
 
    	
Preamble
    
	
 
    	
 
    	
 
    
	
“Initial List”
    	
 
    	
Section 6.07(b)
    
	
 
    	
 
    	
 
    
	
“Representative”
    	
 
    	
Section 6.09(b)
    
	
 
    	
 
    	
 
    
	
“Pricing Benchmark Date”
    	
 
    	
Section 2.01(a)
    
	
 
    	
 
    	
 
    
	
“Anti-corruption Law”
    	
 
    	
Section 4.14(a), Exhibit 4
    
	
 
    	
 
    	
 
    
	
“Parties”
    	
 
    	
Preamble
    
	
 
    	
 
    	
 
    
	
“Share Subscription Price”
    	
 
    	
Section 2.02(b)
    
	
 
    	
 
    	
 
    
	
“Share Subscription   Acknowledgement Letter”
    	
 
    	
Section 2.01(a)
    
	
 
    	
 
    	
 
    
	
“Share Subscription   Quantity”
    	
 
    	
Section 2.01(a)
    
	
 
    	
 
    	
 
    
	
“Company”
    	
 
    	
Preamble
    
	
 
    	
 
    	
 
    
	
“Interim Period”
    	
 
    	
Section 6.04
    

 

 

	
Definition
    	
 
    	
Location
    
	
 
    	
 
    	
 
    
	
“Subscription Price Per   Share”
    	
 
    	
Section 2.02(a)
    
	
 
    	
 
    	
 
    
	
“Subscriber”
    	
 
    	
Preamble
    
	
 
    	
 
    	
 
    
	
“SZSE”
    	
 
    	
Recitals
    
	
 
    	
 
    	
 
    
	
“Effectiveness Conditions”
    	
 
    	
Section 9.01
    
	
 
    	
 
    	
 
    
	
“Effectiveness Notice”
    	
 
    	
Section 9.03
    
	
 
    	
 
    	
 
    
	
“Non-breaching Party”
    	
 
    	
Section 8.01(a)
    
	
 
    	
 
    	
 
    
	
“Lock-up Period”
    	
 
    	
Section 6.07(a)
    
	
 
    	
 
    	
 
    
	
“Lock-up Covenant”
    	
 
    	
Section 6.07(a)
    
	
 
    	
 
    	
 
    
	
“Breaching Party”
    	
 
    	
Section 8.01(a)
    
	
 
    	
 
    	
 
    
	
“New Shares”
    	
 
    	
Recitals
    
	
 
    	
 
    	
 
    
	
“New Shares Registration   Date”
    	
 
    	
Section 3.04(c)
    
	
 
    	
 
    	
 
    
	
“Business Cooperation   Framework Agreement”
    	
 
    	
Recitals
    
	
 
    	
 
    	
 
    
	
“Party”
    	
 
    	
Preamble
    
	
 
    	
 
    	
 
    
	
“Dispute”
    	
 
    	
Section 10.11
    
	
 
    	
 
    	
 
    
	
“Payment Date”
    	
 
    	
Section 3.01
    
	
 
    	
 
    	
 
    
	
“Notice on Full   Satisfaction of Conditions to Payment of Share Subscription Price”
    	
 
    	
Section 3.01
    

 

SECTION 1.03       Other Interpretative Provisions

 

In this Agreement, unless otherwise provided or required in the context:

 

(a)                                 “Hereof”, “herein”, “hereunder” and similar terms shall mean the entirety of this Agreement rather than any specific provision of this Agreement; any reference to any schedule, annex, section and sub-section shall be to the schedule, annex, section and sub-section of this Agreement, unless otherwise indicated.

 

(b)                                 The term “include” does not have a restrictive meaning, and shall mean

 

 

“include without limitation”.

 

(c)                                  The table of contents and headings in this Agreement are inserted for reference only, and shall not in any way affect the interpretation of this Agreement.

 

(d)                                 Any agreement, instrument or other document referred to in this Agreement shall mean the agreement, instrument or other document which may be amended, supplemented or modified from time to time.

 

(e)                                  This Agreement shall be construed to have been jointly drafted by the Parties, and shall not give rise to any assumption or burden of proof that is in favor of or adverse to any other Party on the ground that any provision in this Agreement is drafted by a Party.

 

ARTICLE II                                                PRIVATE PLACEMENT AND SHARE SUBSCRIPTION

 

SECTION 2.01        Issuance and Subscription of Shares

 

(a)                                 Pursuant to the terms and conditions of this Agreement, the Company will issue RMB ordinary shares to the Subscriber in private placement (“this Issuance”), and the quantity of the stocks of the Company that the Subscriber will subscribe for (the “Share Subscription Quantity”) represents nineteen point ninety-nine percent (19.99%) of the total share capital of the Company immediately after this Issuance (the fractional part of the calculation result of the number of the issued shares shall be ignored).  According to the total share capital of the Company as of the execution date of this Agreement and the plan for this Issuance determined by the board of directors of the Company, the Share Subscription Quantity shall be 1,861,012,043 shares.

 

During the period from the announcement date of the board resolution regarding this Issuance (the “Pricing Benchmark Date”) to the Issuance Date, if the Company performs any rights and interests distribution, capitalization from capital public reserve, rights issue, other forms of recapitalization or it is under any other circumstance which would cause a change of the total share capital of the Company, the Company will, pursuant to the calculation formula stipulated in relevant rules of the CSRC, adjust the Share Subscription Quantity, and ensure that the Share Subscription Quantity accounts for nineteen point ninety-nine percent (19.99%) of the total share capital of the Company immediately after this Issuance (the fractional part of the calculation result of the number of the issued shares shall be ignored).

 

The Company shall, on the date of the Effectiveness Notice, sign and deliver to the Subscriber a Share Subscription Acknowledgement Letter (in the form attached hereto as Appendix I, the “Share Subscription Acknowledgement Letter”), to notify the Subscriber of the Share Subscription Quantity.

 

(b)                                 The New Shares issued by the Company in private placement pursuant to this Agreement shall be listed on the SZSE in accordance with Section 3.04(d) in this Agreement.

 

SECTION 2.02        Subscription Price Per Share and Share Subscription Price

 

 

(a)                                 The subscription price per share for the New Shares (the “Subscription Price Per Share”) shall be RMB 15.23, accounting for one hundred and five point seventy-six percent (105.76%) of the average trading price of the Company stocks for the 20 trading days prior to the Pricing Benchmark Date.  Notwithstanding the foregoing, during the period from the Pricing Benchmark Date to the Issuance Date, if the Company performs any rights and interests distribution, dividend distribution, or any allocation, rights issue or recapitalization from capital public reserve or other ex-right or ex-dividend, subject to the compliance with the relevant rules in the PRC Laws regarding the pricing of the shares issued by the listed company in private placement, the Subscription Price Per Share shall be adjusted according to the calculation formula stipulated in the relevant rules of the CSRC.  The Share Subscription Acknowledgement Letter shall indicate the Subscription Price Per Share finally determined.

 

(b)                                 The total subscription price for the New Shares which shall be paid by the Subscriber (the “Share Subscription Price”) shall be the Subscription Price Per Share determined in the Share Subscription Acknowledgement Letter multiplied by the Share Subscription Quantity.

 

ARTICLE III                                           PAYMENT OF SHARE SUBSCRIPTION PRICE AND COMPLETION OF NEW SHARES ISSUANCE

 

Section 3.01        Payment of Share Subscription Price

 

(a)                                 To the extent that all conditions set forth in Section 3.02 in this Agreement are proven to be satisfied or waived (except those which shall be satisfied on the Payment Date pursuant to their terms), within five (5) Working Days after receipt of the written notice sent by the Company pursuant to Section 3.02 herein, the Subscriber shall pay the full amount of the Share Subscription Price to the bank account specially opened for this Issuance as designated by the Company in the Effectiveness Notice.  The date when the Share Subscription Price is fully remitted to the bank account designated by the Company shall be referred to as the “Payment Date” hereunder.  The Parties agree that, upon the receiving bank confirming that the Share Subscription Price has been remitted to the bank account designated by the Company, the Subscriber shall be deemed to have fully performed its payment obligation with respect to its subscription for the New Shares according to this Agreement.

 

(b)                                 If due to any reason attributable to the Company or the Government Order or force majeure, the Company fails to complete formalities for registering all of the New Shares under the Subscriber’s A-share securities account within the time limit prescribed in Section 3.04(c) herein, upon the request of the Subscriber, the Company shall or shall cause relevant parties to fully refund the Share Subscription Price to the Subscriber.

 

SECTION 3.02     Conditions to Payment of Share Subscription Price

 

The Subscriber’s obligation to pay the Share Subscription Price pursuant to this Agreement shall be subject to the satisfaction or written waiver by the Subscriber of each of the following conditions prior to or on the Payment Date:

 

 

(a)                                 Representations, Warranties and Covenants. Certain representations and warranties of the Company in this Agreement (i.e., Sections 4.01, 4.02(a), 4.06, 4.07(b), 4.12(a), 4.14(a) and (b) and 4.17 in Exhibit 4) shall be true, accurate and not misleading as of the execution date of this Agreement, and shall be true, accurate and not misleading in all material respects on the Payment Date, and have the same force and effect as if they were made on the Payment Date; the covenants and agreements contained in this Agreement which shall be performed by the Company on or prior to the Payment Date shall have been performed in all material respects;

 

(b)                                 Approval and Consent.  The CSRC shall have approved this Issuance pursuant to this Agreement and the supplementary agreement (if any) signed by the Parties for this Issuance; the board of directors and the shareholders meeting of the Company have approved this Issuance;

 

(c)                                  Alibaba Share Subscription Transaction. All agreements relating to the Alibaba Share Subscription Transaction shall have been duly signed and delivered, and all of the closing conditions under the Alibaba Share Subscription Transaction shall have been satisfied (except those which shall be satisfied on the closing date of the Alibaba Share Subscription Transaction pursuant to their terms);

 

(d)                                 No Material Adverse Change. There shall be no event or events that would individually or collectively cause any Material Adverse Effect, and no event that would individually or collectively cause any Material Adverse Effect shall be reasonably expected to occur;

 

(e)                                  Effectiveness Notice. The Subscriber shall have received the Effectiveness Notice that conforms to the provisions in Section 9.03 herein.

 

The Company shall, within two (2) Working Days after all conditions set forth above are satisfied (except those which shall be satisfied on the Payment Date pursuant to its terms), deliver a written notice (the “Notice on Full Satisfaction of Conditions to Payment of Share Subscription Price”, in the form attached hereto as Appendix II) to the Subscriber, notifying the Subscriber that such conditions have been satisfied.

 

SECTION 3.03        CONDITIONS PRECEDENT TO ISSUANCE AND REGISTRATION OF NEW SHARES

 

The Company’s obligation to issue and sell the New Shares to the Subscriber hereunder shall be subject to the satisfaction or written waiver by the Company of all of the following conditions on or prior to the Payment Date:

 

(a)                                 Representations, Warranties and Covenants. Certain representations and warranties of the Subscriber in this Agreement (i.e., Sections 5.01 and 5.02(a) in Exhibit 5) shall be true, accurate and not misleading as of the execution date of this Agreement, and shall be true, accurate and not misleading in all material respects on the Payment Date, and have the same force and effect as if they were made on the Payment Date; and

 

 

(b)                                 Approval and Consent. The CSRC shall have approved this Issuance pursuant to this Agreement and the supplementary agreement (if any) signed by the Parties for this Issuance.

 

Section 3.04        Issuance and Registration of New Shares

 

(a)                                 The Subscriber shall, as soon as possible after the execution of this Agreement, launch the opening of its A-share securities account, and timely notify the Company of the progress of the opening, and the Subscriber shall, within three (3) Working Days after it opens A-share securities account with CSDCC, notify the Company in writing of the opening of such account, and provide a proof for such opening.

 

(b)                                 The Company shall, within seven (7) Working Days after the Payment Date, obtain the capital verification report issued by a qualified accounting firm registered in the PRC which is engaged by it with respect to the Share Subscription Price paid by the Subscriber, and provide the Subscriber with a scanned copy of such capital verification report via email.

 

(c)                                  The Company shall, within ten (10) Working Days after the Payment Date, apply for going through the procedures for registering all of the New Shares under the Subscriber’s A-share securities account with CSDCC.  The Company shall cause CSDCC to register all of the New Shares under the Subscriber’s A-share securities account as soon as possible, and the Subscriber shall provide reasonable and necessary assistance and cooperation therefor.  The date when CSDCC registers all of the New Shares under the Subscriber’s A-share securities account shall be the registration date of the new shares (the “New Shares Registration Date”).

 

(d)                                 Within fifteen (15) Working Days after the New Shares Registration Date, the Company shall complete the formalities for listing the New Shares on the SZSE; within thirty (30) Working Days after the New Shares Registration Date, the Company shall register the change regarding this Issuance with the AIC.

 

SECTION 3.05        Shareholders’ Right

 

From the New Shares Registration Date, the Subscriber shall be entitled to all rights, interests and incomes in the New Shares, including without limitation sharing the undistributed profits accumulated prior to this Issuance with other shareholders of the Company in proportion to the percentage of the shares held by the Subscriber in the Company.

 

ARTICLE IV                                            REPRESENTATIONS AND WARRANTIES OF COMPANY

 

The Company hereby represents and warrants to the Subscriber that, as of the execution date of this Agreement and the Payment Date, all representations and warranties in Exhibit 4 are true, accurate, complete and not misleading.

 

 

ARTICLE V                                                 REPRESENTATIONS AND WARRANTIES OF SUBSCRIBER

 

The Subscriber hereby represents and warrants to the Company that, as of the execution date of this Agreement and the Payment Date, all representations and warranties in Exhibit 5 are true, accurate, complete and not misleading.

 

ARTICLE VI                                            COVENANTS

 

Section 6.01        Arrangements for Interim Period

 

(a)                                 The Company agrees and undertakes that, during the period from the execution date of this Agreement to the New Shares Registration Date, unless (i) otherwise agreed herein, or (ii) mutually agreed with the Subscriber, the Company shall:

 

(i)                                     carry out the Business under the normal operation model which is consistent with its past practices;

 

(ii)                                  comply with the PRC Laws and internal management policies of the Company;

 

(b)                                 without limiting Section 6.01(a) above, during the period from the execution date of this Agreement to the New Shares Registration Date, (i) otherwise agreed herein, or (ii) mutually agreed with the Subscriber:

 

(i)                                     no material change shall be made to the major Business of any Major Group Member; or

 

(ii)                                  the Company shall not amend any provision relating to the structure of its board of directors or voting right in its articles of association;

 

(c)                                  without limiting Section 6.01(a) above, during the period from the execution date of this Agreement to the New Shares Registration Date, the Company (or other Major Group Members) shall, to the extent possible, reach an agreement with the Subscriber for:

 

(i)                                     the performance of any material related party transaction between the Major Group Members; or

 

(ii)                                  the disposal of material assets by any Major Group Member.

 

Section 6.02        Information Access

 

From the execution date of this Agreement to the Payment Date, to the extent that the Company receives reasonable notice from the Subscriber, the Company shall: (a) allow the Subscriber and its authorized representatives to discuss with the management personnel of the

 

 

Major Group Members; and (b) provide the representatives of the Subscriber with the financial and operational data and other information (or the photocopies thereof) relating to the Business which may be reasonably requested by the Subscriber from time to time and which can be provided by the Company to the Subscriber in accordance with the applicable Laws; provided that any such access or provision of the information shall be conducted during the normal business hours of the Major Group Members, and shall not unreasonably interrupt the normal operation of the Major Group Members.  The Company shall and shall have the obligation to cause all Major Group Members and their representatives to render cooperation for the above information access by the Subscriber.

 

Section 6.03        Notice on Specific Event

 

The Company shall timely notify the Subscriber in writing of: (a) all events, circumstances and facts which might result in its breach of any of the representations, warranties or covenants hereunder, or which might render any of its representations or warranties hereunder untrue in any respect, and (b) any fact, change, condition and circumstance which is known to it and which will or is reasonably expected to render it impossible to satisfy any condition set forth in Section 3.02 herein.

 

Section 6.04        Non-Solicitation or Negotiation

 

The Company agrees that, except the transaction contemplated herein, from the execution date of this Agreement to (a) the New Shares Registration Date, or (b) the termination of this Agreement (whichever is earlier, the “Interim Period”), if the Company or any Major Group Member intends to conduct any of the following transactions with any person other than the Group Members: (A) any acquisition or obtaining in any other way of all or any part of the shares or equities in a Major Group Member or the major assets or Businesses of a Major Group Member, (B) any transaction involving a merger or consolidation of a Major Group Member, the Company shall, in this regard, fully communicate with the Subscriber and reach an agreement to the extent possible.

 

Section 6.05        Use of Raised Funds

 

The projects invested with the funds raised in this Issuance shall be the arrangements currently proposed by the Company in light of its own needs, and such arrangements may be adjusted accordingly by the Company after following relevant procedures in accordance with the law, based on the approval situation and the change of market conditions and other factors.

 

Section 6.06        Issuance of New Shares

 

(a)                                 As of the New Shares Registration Date, the New Shares represents nineteen point ninety-nine percent (19.99%) of the total share capital of the Company on a fully diluted basis;

 

 

(b)                                 As of the New Shares Registration Date, all of the New Shares shall be duly authorized and validly issued, and the Subscriber will obtain the legal, valid, full and exclusive ownership of all of the New Shares, free of any Encumbrance (except the limitation on Transfer set forth in Section 6.07 herein), and with no obligation to make additional investment in or contribution to the Company under any Law or contract.  The issuance of the New Shares by the Company violates no pre-emptive right.

 

Section 6.07        Limitation on Transfer of New Shares And Holding of Additional Shares By Subscriber

 

(a)                                 Within thirty-six (36) months from the New Shares Registration Date (the “Lock-up Period”), the Subscriber shall not Transfer or sell the New Shares.  The Subscriber shall, pursuant to the applicable Laws and relevant rules and requirements of the CSRC and the SZSE, issue relevant lock-up covenants for the New Shares subscribed by it in this Issuance (the “Lock-up Covenant”) and handle the lock-up for the New Shares.  During the period of the Lock-up Covenant, the Subscriber shall not Transfer the New Shares subscribed by it under this Agreement.

 

(b)                                 In no event shall the Subscriber Transfer or sell the shares it holds in the Company to a competitor of the Company.  For the purpose of this section, a competitor of the Company shall mean any of the Persons and their Affiliates on the competitor list provided by the Company to the Subscriber on the execution date of this Agreement (the “Initial List”), and the Company may update the Initial List for once at the end of any calendar year.  For the avoidance of doubt, the Transfer by the Subscriber of the shares in the Company by centralized bidding shall not be subject to this Section 6.07(b).

 

(c)                                  Upon completion of this Issuance, without prior written consent of the Company, none of the Subscriber or its Affiliates shall in any way hold additional shares in the Company, except where: (i) the holding of additional shares is caused by the dividend distribution or rights issue by the Company to all of its shareholders; or (ii) Mr. Zhang Jindong or the Person designated by Mr. Zhang Jindong ceases to be the actual controller of the Company.

 

Section 6.08        Maintenance of Listing Status

 

Except with approval by the resolution of the shareholders’ meeting of the Company or due to any other factors which are beyond the control of the Company, the Company undertakes to continuously comply with the requirements of the PRC laws, the CSRC and the SZSE regarding listed companies (including appropriately filing with the SZSE for record all notices, reports, announcements, statements and other documents which are required by the SZSE with respect to the companies listed on the SZSE), and prior to the New Shares Registration Date and within six (6) years after the New Shares Registration Date, to maintain the listing status and qualification of the Company.

 

Section 6.09        Confidentiality

 

(a)                                 Unless otherwise agreed in writing by the Parties, the Parties shall not and shall cause their Affiliates and Representatives not to directly or indirectly disclose or permit the

 

 

disclosure of (i) the existence or contents of this Agreement, this Issuance, or the transaction contemplated under this Agreement, (ii) any terms, conditions or other respects of this Agreement, this Issuance or the transaction contemplated under this Agreement, or (iii) the negotiation regarding this Agreement, this Issuance or the transaction contemplated under this Agreement (the “Confidential Information”).

 

(b)                                 Notwithstanding the foregoing, the Parties may (i) only for the purpose of its own use, disclose the Confidential Information to the employees, officers, directors, partners, agents, accountants, legal counsels, representatives or advisors of the Parties (the “Representatives”) who have a need to know the Confidential Information, provided that such Party shall ensure such Representatives are aware of and undertake the same confidentiality obligation; (ii) pursuant to the provisions of the applicable Laws and applicable rules of the stock exchange, disclose to any relevant Government Authority or the stock exchange the Confidential Information which shall be disclosed as required by applicable Laws; and (iii) to the extent reasonable and necessary for any Party to comply with applicable anti-trust and Tax Law, as required by applicable Laws or Government Authority, such Party may disclose the information relating to the transaction contemplated hereunder, provided that in the case of Item (iii), the disclosing party shall (to the extent permitted by applicable Laws), within a reasonable time limit prior to the disclosure, discuss with the other Party and make its best commercial efforts to ensure the disclosed information is kept confidential.

 

(c)                                  The Parties shall, pursuant to the requirements of the CSRC and the SZSE, perform the information disclosure obligation relating to this Agreement and the transaction contemplated hereunder.  The Company shall, subject to compliance with the Laws, confirm with the Subscriber in advance the contents relating to this Agreement or this Issuance which propose to be disclosed.

 

Section 6.10        No Promotion

 

Without prior written consent of the Subscriber or its Affiliates, regardless of whether the Subscriber directly or indirectly holds any shares in the Company, the Company shall not and shall cause its Affiliates not to, for marketing, advertising, promotion or other purposes, use, publish or copy the name of the Subscriber or any of its Affiliates (including without limitation “阿里巴巴”, “淘宝”, “阿里”,  “全球速卖通”, “淘”, “天猫” , “一淘” , “聚划算”, “阿里旅行  去啊”, “阿里妈妈”,  “阿里云”,  “云OS”, “万网”,  “口碑” , “虾米” , “蚂蚁金服” , “蚂蚁” , “支付宝” , “小微金服” , “1688” , “来往”, “一达通” , “友盟” , “酷盘” ,  “天天动听” , “优视” , “高德” , “去啊”, “钉钉”, “余额宝”, “招财宝”,  “芝麻信用”, “Alibaba”, “Taobao” , “Ali” , “AliExpress” ,  “Tao” ,  “Tmall” , “eTao” , “Juhuasuan” , “Alitrip”, “Alimama” , “Aliyun” , “YunOS” , “HiChina”, “Koubei” , “Xiami” , “Ant Financial” , “Ant” ,  “Alipay” , “Xiao Wei Jin Fu” , “Laiwang” , “OneTouch” , “Umeng” , “Kanbox” , “Kupan” , “TTPOD” , “UCWeb” , “UC” , “AutoNavi” , “Alitrip” , “DingTalk”, “Yu’e Bao”, “Zhaocaibao”, “Sesame Credit”, “11 Main” which is individually or in combination, and subsidiary marks and graphic patterns of the above brands (including without limitation the smiling face of Alibaba Group, the bull design of Alibaba Network, ant design of Taobao, design of Taobao doll, cat design of Tmall, design of Juxiaomeng doll of Juhuasuan, ant design of Ant Financial, lion and Zhi Xiaobao designs of Alipay, ingot design of Zhaocaibao and sesame design of Sesame Credit))

 

 

or any similar company name, firm name, trademark, product or service name, domain name, graphic mark, mark, logo or any specific description which enables any third party to identify the Subscriber or any of its Affiliates.  In accordance with Section 9.05 herein, the liabilities and obligations of the Company under this section shall survive the termination of this Agreement and shall have full binding force.

 

Similarly, without prior written consent of the Company or its Affiliates, the Subscriber shall not and shall cause its Affiliates not to, for marketing, advertising, promotion or other purposes, use, publish or copy the name of the Company or any of its Affiliates (including without limitation 苏宁, s苏宁, S + 苏宁+ S + Suning, S+苏宁+Suning, 苏宁+S+SUNING, SUNING苏宁, 蘇寧, 苏宁电器, 苏宁云商, 苏宁易购, e苏宁易购, e 苏宁易购SUNING.CN, e苏宁易购www.suning.cn, 苏宁易购 www.suning.cn, 苏宁易购www.suning.cn, 苏宁众包, 苏宁云店, 苏宁云台, 苏宁云购, 苏宁微店, 苏宁团店, 苏宁闪店, 云苏宁购无界, 电器专家+picture, 苏宁3C, 苏宁3C+, 苏宁电脑, 苏宁手机, 苏宁数码, 苏宁通讯, 苏宁银河, 苏宁首秀, 苏宁精品店, 苏宁私享家, 苏宁优立方,  苏宁3C+, 苏宁3c帮客, 苏宁it帮客, 苏宁帮客, IT帮客, 苏宁电脑, 苏宁音响, 苏宁5S阳光服务, 苏宁阅读, 苏宁电器广场, 苏宁广场, 苏宁国际广场, 苏宁好买家, 苏宁家电, 苏宁超市, 易付宝, 零钱宝, 苏宁易付宝, 苏宁团团赚, 苏宁电器至真至诚阳光服务, 苏宁服务易栈, 缤购, 阳光包, 阳光保, 红孩子, 红婴孩, 乐购仕, 乐购思, 乐购仕生活广场, SUNING, Suning.com, 苏宁易购suning.com and lion design (square eyes), 苏宁易购suning.com and lion design (round eyes), suning.com and lion design, SUNING+Digital, SUNINGELITE, e苏宁易购www.suning.cn, 易购SUNING.CN, SUNINGPLAZA, SUNINGWISDOMVALLEY, WWWCNSUNINGCOM, Image Vision, musicmax, MUSICVOX, ASOBIT CITY, ASOBIT TOWN, ASOBITCITY(variation), ASOBITCITY(graph), LAOX LIFE, LAOX, laox, Expo超级旗舰店(graph), , redbaby and graph, redbaby graph, 缤购, BINGGOCOM which is individually or in combination, and the names and graphs of the APPs developed by the Company, or any similar company name, firm name, trademark, product or service name, domain name, graphic mark, mark, logo or any specific description which enables any third party to identify the Company or any of its Affiliates.  In accordance with Section 9.05 herein, the liabilities and obligations of the Subscriber under this section shall survive the termination of this Agreement and shall have full binding force.

 

Section 6.11        Further Action

 

The Parties shall make all reasonable efforts, take or cause the taking of all necessary and proper actions, perform or cause the performance of all necessary, proper or advisable matters under applicable Laws, and execute and deliver all necessary documents and other instruments, in order to perform the provisions in this Agreement and consummate the transaction contemplated under this Agreement.  In particular, the Company shall (i) perform all proper and timely acts, convene the shareholders’ meeting, and submit the matters relating to this Issuance to the shareholders’ meeting for deliberation; and (ii) file an application to relevant competent authorities with respect to this Issuance for examination and approval, and subject to compliance with the Laws, prior to submitting the relevant materials, the Company shall fully discuss and reach an agreement with the Subscriber with respect to the contents relating to the Subscriber therein, and give a prior notice to and update the Subscriber on the communication

 

 

with the competent authorities; the Subscriber shall have the right, where appropriate and feasible, to designate representatives to participate in the interviews or meetings between the Company and relevant competent authorities with respect to this Issuance.

 

Section 6.12        ELECTION OF DIRECTORS

 

Within five (5) Working Days after the New Shares Registration Date, the Company shall give a notice of convening the shareholders’ meeting, in order to deliberate on the re-election of members of the board of directors.  The director candidates shall include two (2) candidates nominated by the Subscriber for non-independent directors.

 

ARTICLE VII                                       RIGHTS OF SUBSCRIBER AS INVESTOR

 

Section 7.01                            Nomination to Board

 

Upon the completion of this Issuance, the board of the Company shall be composed of no more than nine (9) directors.  On condition that the Subscriber has not transferred or sold any shares of the Company, if the Subscriber holds no less than fifteen percent (15%) shares of the Company, the Subscriber shall have the right to nominate two (2) non-independent directors; if the Subscriber holds less than fifteen percent (15%) but more than ten percent (10%) shares of the Company, the Subscriber has the right to nominate one (1) non-independent director.  If the Subscriber has transferred or sold any shares of the Company, the Subscriber has the right to nominate one (1) non-independent director as long as the Subscriber holds no less than ten percent (10%) shares of the Company.  Subject to the Laws of the PRC and the articles of association of the Company, the persons so nominated shall be the directors of the Company if approved by the shareholders’ meeting of the Company.

 

Section 7.02                            Right of First Refusal

 

Upon the completion of this Issuance, if the Company intends to further issue any securities, without any violation of the applicable the Laws of the PRC and the articles of association of the Company, the Subscriber shall have the right of first refusal to subscribe for the securities to be issued by the Company at the same price and conditions offered to any other Persons, to ensure that the proportion of shares held by the Subscriber in the Company immediately before such issuance of securities on a fully diluted basis shall remain unchanged immediately after the completion of such issuance of securities.

 

Section 7.03                            Right to Information

 

Without any violation of the applicable Laws and the internal management rules of the Company, upon reasonable request of the Subscriber, the Company shall provide necessary assistance to the Subscriber or its consultant, to enable the Subscriber to meet any requirements for preparing its accounting report, internal audit or compliance.  The Company

 

 

shall comply with the applicable Laws and listing rules and publish quarterly, semi-annual and annual reports of the Company within such period as required thereunder.

 

ARTICLE VIII                                  INDEMNIFICATION

 

Section 8.01              Liability for Indemnification

 

(a)                                 If a Party (“Breaching Party”) commits a violation of any of its representations, statements, warranties, undertakings, covenants or obligations under this Agreement, the Breaching Party shall indemnify the other Party (“Non-Breaching Party”) from and against any and all losses, damages, costs and expenses, interests and penalties suffered by or incurred to the Non-Breaching Party due to such breach.

 

(b)                                 Notwithstanding the above, unless the indemnification payable to the Non-Breaching Party due to the Breaching Party’s violation of any of its representations, statements, warranties, undertakings, covenants or obligations under this Agreement is, in the aggregate, more than one point five percent (1.5%) of the total share subscription price, the Breaching Party shall not be liable to the Non-Breaching Party for indemnification.

 

(c)                                  For all claims with respect to the representations and warranties made by the Company in Article IV of this Agreement, the indemnification is limited to the maximum amount as follows:

 

(1)                                 in relation to the representations and warranties under Sections 4.01, 4.03, 4.04 and 4.05 of Exhibit 4 hereto, 100% of the Share Subscription Price;

 

(2)                                 in relation to any other representations and warranties made by the Company under Article IV of this Agreement, twenty percent (20%) of the Share Subscription Price.

 

For the avoidance of any doubt, the Company shall not be liable for any indemnification exceeding the maximum amount as set out above.

 

Section 8.02              Other Remedies

 

The Parties agree that the indemnification as provided for in Section 8.01 shall not be the sole remedy available to the Non-Breaching Party in case of any violation by the Breaching Party of any of its representations and warranties under this Agreement or any failure by the Breaching Party to fulfill and comply with any of its undertakings and covenants under this Agreement.  If the Breaching Party fails to duly perform or violates any provisions of this Agreement, the Non-Breaching Party may seek for any other rights or any and all other remedies available pursuant to this Agreement and the Laws of the PRC applicable to this Agreement.

 

 

ARTICLE IX                                           EFFECTIVENESS AND TERMINATION

 

Section 9.01              Effectiveness

 

This Agreement shall be concluded upon its execution by the Parties by affixing their common seal hereto.  Articles I, IV, V, VI (except for Sections 6.05, 6.07, 6.08 and 6.12), VIII, IX and X shall become effective upon its execution by the legal representative or authorized representative of each of the Parties by affixing their names or common seal, and the remaining Articles of this Agreement regarding this Issuance shall become effective on the date on which all of the following conditions (“Effectiveness Conditions”) are met or satisfied:

 

(a)                                 the board of directors and the shareholders’ meeting of the Company shall have approved this Issuance; and

 

(b)                                 CSRC shall have approved this Issuance pursuant to this Agreement and a supplementary agreement (if any) between the Parties with respect to this Issuance.

 

Section 9.02              Cooperation to Satisfy Effectiveness Conditions

 

(a)                                 The Parties will cooperate with each other to take all necessary actions and measures (including execution of specific documents and execution and delivery of any other necessary or reasonable documents from time to time in accordance with general principles of this Agreement and based on actual demands) to effect the Effectiveness Conditions as soon as possible.  The Company shall take all appropriate and prompt actions to convene a shareholders’ meeting to which any matters concerning this Issuance shall be submitted for review and approval.  The Parties shall apply this Issuance to the competent Government Authority for review and approval.  Subject to the Laws, the Company shall, before its submission of any documents, negotiate and reach an agreement with the Subscriber on any provisions of such documents concerning the Subscriber and notify the Subscriber in advance of, and update the Subscriber with, any communication with the competent Government Authority.

 

(b)                                 If one of the Effectiveness Conditions has been satisfied, the Company shall, within three (3) Working Days after it has become aware that such Effectiveness Condition has been satisfied, notify the Subscriber in writing of the same and provide a copy of all relevant documents showing that the Effectiveness Condition has been satisfied.  In addition, the Parties agree not to, and shall ensure that they and their Affiliates shall not, enter into any transactions, or take any actions, which may prevent, delay or interfere with the full effectiveness of this Agreement, until this Agreement enters into full force and effect.

 

(c)                                  If any of the Effectiveness Conditions is not satisfied due to any failure by a Party to perform in good faith or to do its reasonably commercial efforts to cause any of the Effectiveness Conditions to be satisfied, such Party shall not terminate this Agreement or be exempt from performing or assuming any of its obligations or duties under this Agreement on the ground that the Effectiveness Conditions have not been satisfied.

 

Section 9.03              Effectiveness Notice

 

 

Within five (5) Working Days from the day on which the Company has become aware that all of the Effectiveness Conditions have been satisfied or on any other dates as otherwise agreed by the Parties, the Company shall send a written notice to the Subscriber of the satisfaction of all of the Effectiveness Conditions (“Effectiveness Notice”) in such a form as set out in Appendix III hereto, attaching all relevant documents showing the satisfaction of all of the Effectiveness Conditions, details of a bank account as designated by the Company to receive the Share Subscription Price and any other documents as required by the Subscriber for the purpose of investment.

 

Section 9.04              Termination

 

This Agreement may be terminated at any time prior to the Payment Date as follows:

 

(a)                                 the Subscriber shall be entitled to terminate this Agreement, if, between the execution date of this Agreement and the Payment Date: (i) certain event or circumstance occurs that has caused the failure to satisfy any of the conditions under Section 3.02, or (ii) the Company makes a general assignment for the benefit of its creditors, or (iii) any legal proceedings have been initiated by or against the Company to declare the entering into bankruptcy proceedings, bankruptcy or insolvency of the Company, or to carry out liquidation, winding-up, reorganization or debt restructuring for bankruptcy, insolvency or reorganization pursuant to any Laws, and any of the foregoing has not been cured or removed within fifteen (15) Working Days after a written notice of the same has been sent by the Subscriber;

 

(b)                                 the Company or the Subscriber shall be entitled to terminate this Agreement if this Issuance does not take place within twenty-four (24) months or any period extended by the Parties through mutual agreement following the execution date of this Agreement, provided that the right to terminate this Agreement under this Section 9.04(b) shall not be available to a Party whose failure to substantially perform hereof has been the primary cause of or resulted in the failure of this Issuance to occur on or before that date;

 

(c)                                  the Company or the Subscriber shall be entitled to terminate this Agreement if any competent Government Authority has issued any valid orders, statutes or rulings, or has taken any other actions, to restrict, prevent or otherwise prohibit this Issuance;

 

(d)                                 the Company shall be entitled to terminate this Agreement if the conditions for payment of the Share Subscription Price have been satisfied but the Subscriber fails to pay the Share Subscription Price within fifteen (15) Working Days after the day on which such conditions have been satisfied; or

 

(e)                                  upon the mutual agreement in writing of the Parties.

 

Section 9.05              Survival of Certain Sections

 

 

If this Agreement is terminated pursuant to Section 9.04, this Agreement shall become invalid immediately and neither Party shall be subject to any obligations and duties, provided that (a) the provisions of Section 6.09, Section 6.10, Article VIII, Section 9.04, Section 9.05 and Article X shall survive the termination of this Agreement, and (b) no provisions of this Agreement shall release a Party from any obligations and duties to be assumed by it due to any breach of this Agreement prior to the termination of this Agreement.

 

ARTICLE X                                                MISCELLANEOUS

 

Section 10.01       Fees

 

Each Party hereto shall bear its own fees, costs and expenses (including but not limited to those for legal advisor and financial advisor) incurred in connection with the preparation, execution and performance of this Agreement and this Issuance.

 

Section 10.02       Taxes

 

Each Party hereto shall declare and pay the Taxes imposed on it pursuant to all applicable Laws airing out of or in connection with the execution and performance of this Agreement and implementation of any transactions contemplated hereby.

 

Section 10.03       Assignment

 

This Agreement shall be binding upon and inure for the benefit of successors and assigns of each Party hereto.  Neither Party may assign this Agreement without the prior written consent of the other Party.

 

Section 10.04       Entire Agreement

 

This Agreement and any other documents to be delivered hereunder (including Appendices I to III, Exhibits 4 to 5 ) constitute the entire understanding and agreement between the Parties with respect to the subject matter of this Agreement and supersede any previous written or oral agreement and covenant between the Parties with respect to the subject matter hereof.

 

Section 10.05       Severability

 

If any terms or other provisions of this Agreement are held to be invalid, illegal or unenforceable pursuant to any Laws or public policies, all of the remainder terms and provisions of this Agreement shall remain in full force and effect as long as any transactions contemplated hereby have not been affected, in financial or legal respect, in a manner which may have an material adverse effect on a Party.  When any terms or other provisions hereof are held to be invalid, illegal or unenforceable, the Parties shall negotiate in good faith to modify this Agreement to effectuate the original intention of the Parties as closely as possible in an

 

 

acceptable way so that the transactions contemplated hereby can be completed to a maximum extent.

 

Section 10.06       Waiver

 

Either Party hereto may (a) extend time for other Party to perform its obligations hereunder or take any other actions, (b) waive its right to require the other Party to be liable for any inaccurate representations and warranties made by the other Party in this Agreement or any documents to be delivered under this Agreement, or (c) waive its right to require the other Party to comply with any covenants in this Agreement or satisfy any conditions precedent to any obligations hereunder.  No such extension or waiver shall be valid unless expressively set out in any written documents signed by the Parties bound upon by such extension or waiver.  No waiver of any term or condition of this Agreement shall be deemed as a waiver of its right to any subsequent breach of the same term or conditions, or a waiver of its right to the same term or condition subsequently, or a waiver of its right to any other terms or conditions of this Agreement.  No failure of a Party to claim any of its rights hereunder shall constitute a waiver of the Party of such right.  All rights and remedies available under this Agreement are cumulative and addition to any other rights or remedies otherwise available.

 

Section 10.07       Amendment

 

This Agreement shall not be amended or modified unless by (a) a written document signed or sealed by the Parties or their respective authorized representative or (b) a waiver made pursuant to Section 10.06.

 

Section 10.08       No Third Party Benefit

 

This Agreement shall be binding upon and inure for the benefit of the Parties and their respective successors and permitted assigns.

 

Section 10.09       Notice

 

All notices required or permitted under this Agreement shall be made in writing and deemed to have been duly given:

 

(a)                                 if delivered personally, when given to the other Party to which the notice is sent under this Agreement;

 

(b)                                 if sent by facsimile with a confirmation of transmission, when a confirmation of transmission is received if sent during normal business hours of the addressee; or on the second (2nd) Working Day after sending if sent out of business hours of the addressee;

 

(c)                                  if sent by courier service, three (3) days after given to the courier service; or

 

 

(d)                                 if sent by e-mail, when sent to the server of the other Party to which the notice is sent under this Agreement

 

All communication shall be sent to the following addresses or any other addresses notified by a Party to the other Party in writing ten (10) days in advance:

 

	
If to the Company:
    
	
Attention:
    	
 
    
	
Address:
    	
Suning Commerce   Group Co., Ltd.
    
	
Tel:
    	
 
    
	
Fax:
    	
 
    
	
E-mail:
    	
 
    
	
 
    	
 
    
	
If to the Subscriber:
    
	
Attention:
    	
Legal Department
    
	
Address:
    	
 
    
	
Tel:
    	
 
    
	
Fax:
    	
 
    
	
E-mail:
    	
 
    

 

For the avoidance of doubt, any written notice or communication required to be sent by the Company to the Subscriber under this Agreement shall be deemed to have been duly made if sent by email, in the form of text and/or attachment, to such an email box as designated by the Subscriber from such an email box as designated by the Company, without affixing thereto the Company’s seal; and a written reply shall deemed to have been made if sent by email to the Company by the Subscriber from the email box as designated under this Section 10.09, in the form of text and/or attachment, without affixing thereto the Subscriber’s seal.  The Subscriber shall reply as soon as possible after having received such notice.  All notice or communication sent by the Company to the Subscriber shall be deemed to have been consented by the Subscriber in writing if not replied by the Subscriber within 2 Working Days after such notice is given.  If either Party intends to change the email box designated by it, it shall send a notice of change to the email box designated by the other Party 2 Working Days in advance.

 

Section 10.10       Counterparts

 

This Agreement shall be executed in eight (8) counterparts, with one (1) held by the Company, one (1) held by the Subscriber and the remaining kept by the Company for handling relevant governmental procedures, each of which shall be deemed an original with equal effect.

 

Section 10.11       Governing Law and Dispute Resolution

 

(a)                                 This Agreement shall be governed by, and construed in accordance with, the Laws of the PRC.

 

 

(b)                                 Any dispute arising out of the execution of, or in connection with, this Agreement (“Dispute”) shall be resolved in first instance through consultation between the Parties.  The requesting Party shall inform the other Party immediately of the Dispute explaining the nature thereof by sending a notice with a specific date.  If the Dispute cannot be resolved within thirty (30) days following the date of the notice, the Dispute shall be submitted by either Party to a court having jurisdiction thereof for litigation.

 

Section 10.12       Language

 

This Agreement is made in Chinese.

 

[Remainder of page intentionally left blank]

 

 

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of the first date written above.

 

 

	
 
    	
Suning Commerce Group Co., Ltd.
    
	
 
    	
(seal)
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Signed by:   [Corporate Seal] /s/ Ren Jun
    
	
 
    	
Name:
    
	
 
    	
Position:
    

 

 

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of the first date written above.

 

 

	
 
    	
Taobao (China)   Software Co., Ltd.
    
	
 
    	
(seal)
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Signed by: [Corporate   Seal]
    
	
 
    	
Name:
    
	
 
    	
Position:
    

 

 

APPENDIX I

 

Form of Letter of Acknowledgement for Share Subscription

 

Letter of Acknowledgement for Share Subscription

 

This Letter of Acknowledgement for Share Subscription (this “LOA”) is signed by the Company at      on                , 201  .

 

Whereas

 

1                               The Company and the Subscriber entered in a Share Subscription Agreement on August 8, 2015 (“Share Subscription Agreement”);

 

2                               [Information of ex-dividend and ex-right of the Company (if any)];

 

3                               Pursuant to Section 9.03 of the Share Subscription Agreement, the Company sent to the Subscriber the Effectiveness Notice on the date of this LOA.

 

Pursuant to Article II of the Share Subscription Agreement, the Company hereby acknowledges that:

 

The Share Subscription Quantity of this Issuance is [   ] and the Subscription Price Per Share is RMB [   ].  The Share Subscription Price payable by the Subscriber is RMB [   ].

 

Unless otherwise provided for herein, the capitalized terms used herein shall have the same meanings ascribed to them in the Share Subscription Agreement.

 

[The Remainder of this Page Intentionally Left Blank; Signature Page Follows]

 

27

 

IN WITNESS WHEREOF, the Party hereto have caused this LOA to be executed as of the first date written above.

 

 

	
Suning Commerce Group   Co., Ltd.
    	
 
    
	
 
    	
 
    
	
(seal)
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Signed by:
    	
 
    	
 
    
	
 
    	
 
    
	
Name:
    	
 
    
	
 
    	
 
    
	
Position:
    	
 
    
			

 

28

 

APPENDIX II

 

Notice on Full Satisfaction of Conditions to Payment of Share Subscription Price

 

To: Taobao (China) Software Co., Ltd.

Address: 5th Floor, 3# Building, 969 Wenyi West Road, Yuhang District, Hangzhou City, Zhengjiang Province

Attention: Legal Department

Fax: 0571-86561717

 

Date:               , 201   

 

Dear Sir or Madam,

 

We refer to the Share Subscription Agreement between Suning Commerce Group Co., Ltd. and Taobao (China) Software Co., Ltd. dated August 8, 2015 (“Share Subscription Agreement”).  The capitalized terms used herein shall have the same meanings ascribed to them in the Share Subscription Agreement.

 

Pursuant to Section 9.03 of the Share Subscription Agreement, we hereby notify you that:

 

(1)             certain representations and warranties made by the Company in the Share Subscription Agreement (Sections 4.01, 4.02(a), 4.06, 4.07(b), 4.12(a), 4.14(a) and (b) and 4.17 of Exhibit 4) are true, accurate and not misleading as of the execution date of the Share Subscription Agreement, and shall be true, accurate and not misleading in all material respects as of the Payment Date and have same effect as if the same were made on the prior to the Payment Date under the Share Subscription Agreement have been fulfilled in all material respects;

 

(2)             no one or more events have occurred which may individually or collectively cause a Material Adverse Effect, and no events are reasonably expected to occur which may individually or collectively cause a Material Adverse Effect;

 

(3)             except for Section 3.02(e), all conditions to payment of the Share Subscription Price under Section 3.02 of the Share Subscription Agreement are satisfied on           , 201  .

 

[The Remainder of this Page Intentionally Left Blank; Signature Page Follows]

 

29

 

	
Regards,
    	
 
    
	
 
    	
 
    
	
 
    	
Suning Commerce Group   Co., Ltd.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Position:
    	
 
    

 

List of Schedules

 

1.                  A copy of an approval issued by CSRC approving this Issuance; and

2.                  Effectiveness Notice.

 

30

 

APPENDIX III

 

Form of Effectiveness Notice

 

Effectiveness Notice

 

To: Taobao (China) Software Co., Ltd.

Address: 5th Floor, 3# Building, 969 Wenyi West Road, Yuhang District, Hangzhou City, Zhengjiang Province

Attention: Legal Department

Fax: 0571-86561717

 

Date:               , 201

 

Dear Sir or Madam,

 

We refer to the Share Subscription Agreement between Suning Commerce Group Co., Ltd. and Taobao (China) Software Co., Ltd. dated August 8, 2015 (“Share Subscription Agreement”).  The capitalized terms used herein shall have the same meanings ascribed to them in the Share Subscription Agreement.

 

Pursuant to Section 9.03 of the Share Subscription Agreement, we hereby notify you that:

 

(1)                       The Effectiveness Conditions as set forth in Section 9.01 of the Share Subscription Agreement are satisfied on           , 201  , with relevant evidence documents attached hereto.

 

(2)                       Information of the bank account designated by us to receive the Share Subscription Price is as follows:

 

	
Bank:
    	
[                ]
    
	
 
    	
 
    
	
Address:
    	
[                ]
    
	
 
    	
 
    
	
Account No.:
    	
[                ]
    
	
 
    	
 
    
	
Account Name:
    	
[                ]
    
	
 
    	
 
    
	
SWIFT CODE:
    	
[                ]
    

 

Regards,

 

Suning Commerce Group Co., Ltd.

 

31

 

	
 
    	
By:
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Position:
    	
 
    

 

List of Schedules:

 

1.                  A board resolution of the Company approving this Issuance;

2.                  A resolution of shareholders’ meeting of the Company approving this Issuance;

3.                  An approval issued by CSRC approving this Issuance; and

4.                  Approvals issued by other governmental authorities if necessary.

 

32

 

EXHIBIT 4

 

Representations and Warranties of Company

 

The Company hereby represents and warrants to the Subscriber, other than those set forth in any documents announced or disclosed three years prior to the execution date of this Agreement (i.e. from August    , 2012) (except for any forward-looking representations or disclaimers contained in the documents announced or disclosed, or non-specific risk disclosure contained in risk disclosure, but not excluding any factual information disclosed therein):

 

Section 4.01                             Organization and Authority.  The Company is a company limited by shares duly organized, validly existing and in good standing under the Laws of the PRC.  The Company has all requisite power and authority and full legal capacity to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby.  Subject to the Effectiveness Conditions as set forth in this Agreement, all necessary corporation actions have been taken for the authorization of the execution and delivery by the Company of this Agreement, the performance of its obligations hereunder and the consummation of the transactions contemplated hereby.  This Agreement has been duly executed and delivered, and, if the Subscriber has duly authorized, executed and delivered this Agreement, subject to Section 9.01 of this Agreement, this Agreement constitutes its legal, valid and binding obligations and is enforceable against it in accordance with its terms.  The Company is not in winding-up, or becomes bankrupt and insolvent, or is unable to pay its debts as they fall due.  The Company has not entered into any liquidation or taking-over proceedings under the Laws of the PRC.  There are no petitions filed, orders made, valid resolutions adopted or any other actions taken in relation to its liquidation, winding-up, declaration of bankruptcy or any other similar events.

 

Section 4.02                             Non-Contravention.  The execution, delivery and performance by the Company of this Agreement (a) is not in any breach or violation of or in conflict with any provisions of its articles of association or any other constitutional documents; (b) is not in any breach or violation of the applicable Laws or the Government Orders (or results in any single event or a series of events which may cause a Material Adverse Effect due to such Laws or Government Orders), causing a Material Adverse Effect on the Company; or (c) results in any violation or breach of any Material Contracts, documents or arrangements to which it is a party or which is binding on any of its assets, or constitute a default under, or give rise to any rights of termination, modification, acceleration of performance, suspension, withdrawal or cancellation of such contracts, documents or arrangement, or result in the creation of any Encumbrance upon any equity interests or assets of any Group Members under such contracts, documents or arrangements, which may cause a Material Adverse Effect on the Company.

 

Section 4.03                             Consents and Approvals.  No consents, permits or authorizations are required from any other Persons (including creditors, but excluding the Government Authority) in connection with the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, except for those which, if not obtained, will not cause a Material Adverse Effect.

 

Section 4.04                             Key Group Members other than the Company.  Each of the key

 

33

 

Group Members, other than the Company, is a limited liability company or a company limited by shares duly organized, validly existing and in good standing under the Laws of the place where it is incorporated, and is not in winding-up, or becomes bankrupt and insolvent, or is unable to pay its debts as they fall due, and has not entered into any liquidation or taking-over proceedings under the Laws of the place where it is incorporated. There are no petitions filed, orders made, valid resolutions adopted or any other actions taken in relation to its liquidation, winding-up, declaration of bankruptcy or any other similar events.

 

Section 4.05                             Capital Structure.  The total share capital of the Company is 7,383,043,200 ordinary shares as of the execution date of this Agreement, all of which have been duly authorized and issued without any additional obligation of capital contribution.  The registered capital of each of the key Group Members has been paid up in full or paid by installment in accordance with the Laws and the provisions of its articles of association; the payment of the registered capital is in compliance with the Laws and the provisions of its articles of association; none of its shareholders have any additional obligation to make further capital contribution other than that which has not been paid as it does not fall due.

 

Section 4.06                             Compliance with Laws.  Each of the key Group Members has carried out its Business in compliance with all applicable Laws and Government Orders and none of its business activities are in violation of such Laws and Government Orders in any material respects or may result in any illegal actions causing a Material Adverse Effect.  Each of the key Group Members has obtained all of the Government Approvals, in any respects, necessary for it to carry out its business activities and is not in violation of such Government Approvals, and all of such Government Approvals are valid.  There are no reasons or circumstances which may cause such Government Approvals to be invalid or withdrawn, except for any circumstances which will not cause a Material Adverse Effect.

 

Section 4.07                             Demands.

 

(a)          Except for those disclosed on any statutory disclosure media (not subject to the three-year period as set forth above), there are no outstanding or (to the knowledge of the Company) potential Demands (including those made by or to the Government Authority) against or concerning any of the Group Members or their assets.  None of the Group Members or their assets are subject to any Government Orders which may cause a Material Adverse Effect.

 

(b)          There are no Demands against any of the Group Members, whether occurred or likely to occur, which are reasonably expected to impose restrictions on this Issuance, or make any material change to the substantially commercial terms of this Issuance (i.e. Article II and Section 6.07 of this Agreement), or likely cause this Issuance not to be consummated, or likely constitute a Material Adverse Effect.

 

Section 4.08                             Material Contracts.  The Material Contracts of each of the Group Members: (a) are legally formed and binding on all parties thereto and in full force and effect; and (b) shall remain in force and effect after the closing of the transactions contemplated hereby and will not result in a Material Adverse Effect due to this Issuance.  To the knowledge of the Group Members or the Company, none of the counterparties to the Material Contracts are in material violation of the Material Contracts.  All of the Material Contracts executed by the Group

 

34

 

Members are duly disclosed in accordance with the applicable Laws of the PRC.

 

Section 4.09                             Assets.  Except for those disclosed on any statutory disclosure media (not subject to the three-year period as set forth above), each of the Group Members legally owns its own Real Property used or to be used in the course of the Business, and there are no Encumbrances over such assets which may have a Material Adverse Effect.  Each material Leased Real Property is a subject matter of valid and binding leases between the lessor (as one party) and the Group Member (as the other party).  In relation to each of such leases, (1) it is valid, binding and enforceable in accordance with its terms under applicable Laws; (2) the lessor thereto owns, or is authorized by the owner of the Leased Real Property to rent out, the Leased Real Property, except for any circumstances which will not have a Material Adverse Effect.

 

Section 4.10                             Intellectual Property.  (i) Each of the Group Members owns all rights and interest in the main Intellectual Property solely owned by it.  There is no Encumbrance over such main Intellectual Property.  Each of the Group Members has the right to use the Intellectual Property owned by it without limitation in its continuing business; (ii) each of the Group Members is duly licensed to use the Intellectual Property licensed to it and the licensor thereof has not terminated the license during the period of license; (iii) none of the Intellectual Property now used by each of the Group Members is held to be invalid or unenforceable; (iv) each of the Intellectual Property registered with the Government Authority is in compliance with the applicable Laws and all filing, payment and other actions to be done or taken to maintain such Intellectual Property in full force and effect have been done, provided that matters which will not cause a Material Adverse Effect are excluded under items (ii) to (iv).  To the knowledge of the Company: (a) neither the operation of the Business of the Group Members nor the use of the Intellectual Property has infringed or misappropriated the Intellectual Property of any third party or conflicted with the Intellectual Property of any third party Person, and there are no claims by any third party in relation to the foregoing; (b) no Persons are doing anything which may infringe the Intellectual Property of the Group Members; (c) none of the Intellectual Property of the Group Members is subject to any Government Orders which may impose restrictions on the use thereof or have an effect on the validity or enforceability thereof, provided that matters which will not cause a Material Adverse Effect are excluded under items (a), (b) and (c).

 

Section 4.11                             Taxes.  Each of the Group Members is in compliance with the Tax Laws in all material respects for the period since its establishment or within any statutory retrospective limitation periods, whichever is longer.

 

Section 4.12                             Financial Statement.

 

(a)                       The audited consolidated annual balance sheets of the Company for the fiscal years ended December 31, 2012, December 31, 2013 and December 31, 2014 and the audited consolidated profit statements and cash flow statements of the Company in connection therewith, together with all the notes and exhibits thereto, which have been disclosed by the Company, and the unaudited consolidated half-year balance sheet of the Company as of June 30, 2015 and the unaudited consolidated profit statement and cash flow statement of the Company in connection therewith, together with all the notes and exhibits thereto: (i) have been prepared in accordance with the PRC GAAP and past practices of the Company applied on a consistent basis;

 

35

 

and (ii) present a true, accurate and fair view in all material respects of the consolidated financial position, results of operations and cash flows of the Company as at the respective dates thereof and for the periods covered thereby.

 

(b)                       Unless set forth in the audited consolidated balance sheet for the fiscal year ended December 31, 2014 (including all the notes and exhibits thereto), the Group Members have no material Indebtedness of any kind, except for the Indebtedness (i) incurred in the course of the normal business activities since December 31, 2014; or (ii) reflected in the unaudited consolidated half-year balance sheet of the Company as of June 30, 2015 and the unaudited consolidated profit statement and cash flow statement of the Company in connection therewith, together with all the notes and exhibits.

 

Section 4.13                             No Specific Changes.  Except for the execution, negotiation and performance of this Agreement and each other agreement and document executed and delivered by the Parties hereto or their respective Affiliates in relation to or in connection with the transactions contemplated under this Agreement, since June 30, 2015, the Key Group Members have continued to carry out their business operations in the ordinary and usual course of business consistent with past practice in all material respects.  There are no events, changes or circumstances occurred which may cause a Material Adverse Effect.

 

Section 4.14                             Specific Compliance Matters.

 

(a)                       Over the last five years, neither the Company nor its directors and senior officers have engaged in any activities set forth in paragraph (c) violating any applicable provisions of the Criminal Laws of the PRC, the Anti-Unfair Competition Laws of the PRC and the Foreign Corrupt Practices Act of USA regarding anti-unfair competition, anti-bribery and anti-commercial bribery, anti-corruption and anti-money laundering (the “Anti-Corruption Laws”);

 

(b)                       Neither the Company nor its directors and senior officers have engaged in and will not engage in any activities which are set forth in paragraph (c) or may cause the Subscriber or any of its Affiliates to commit any conduct in violation of the Anti-Corruption Laws;

 

(c)                        None of the Group Members, to the knowledge of the Company, have offered, committed or authorized to pay any money or offered to give, granted, committed to give or award anything of value to any of the Government Officials in order to: (1) have an influence on the Government Officials’ actions and decisions when they are exercising their official authority; (2) induce the Government Officials to take or not to take any actions in violation of their statutory duties; (3) acquire improper advantages; (4) induce the Government Officials to have an influence on any actions or decisions of the Government Authority;

 

(d)                       None of any Government Official or Government Authority now has any statutory or beneficial ownership in the Company and the Share Subscription Price paid by the Subscriber to the Company hereunder;

 

(e)                        Each of the Group has established an efficient controlling system which is expected to be sufficient to prevent, discover and deter any violation of the Anti-Corruption

 

36

 

Laws as set forth in paragraph (c) above;

 

(f)                         The operation activities of each of the Group Members are carried out at all time in compliance with requirements regarding financial records and reports under the applicable anti-money laundering laws.  There are no outstanding or threatened litigation concerning any of the Group Members made by or to any of the Government Authority arising out of any violation of the anti-money laundering laws.

 

Section 4.15                             Qualified Issuer.  No circumstances as set forth in Article 39 of the Administrative Measures for the Issuance of Securities by Listed Companies have occurred to the Company.

 

Section 4.16                             Employees.  Each of the Group Members has complied with all applicable Laws regarding employment or employment relationship in all material respects.

 

Section 4.17                             Disclosure of Information.  The Company has complied with the Laws of the PRC and rules of CSRC and SZSE regarding listed companies.  The Company has disclosed information in accordance with the Laws of the PRC and regulatory requirements of SZSE regarding disclosure of information.  The information disclosed by the Company is true, accurate and complete without any false records, misleading statement or material omission.  There are no facts which may have a Material Adverse Effect on any of the key Group Members but is not disclosed in this Agreement or information disclosed by the Company.

 

37

 

EXHIBIT 5

 

Representations and Warranties of Subscriber

 

The Subscriber hereby represents and warrants to the Company, as of the execution date of this Agreement and the Payment Date:

 

Sectin 5.01                                    Organization and Authority.  It is a limited liability company duly organized, validly existing and in good standing under the Laws of the PRC.  It has all requisite power and authority and full legal capacity to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby.  Subject to the Effectiveness Conditions as set forth in this Agreement, all necessary corporation actions have been taken for the authorization of its execution and delivery of this Agreement, the performance of its obligations hereunder and the consummation of the transactions contemplated hereby.  This Agreement has been duly executed and delivered by it, and, if the Company has duly authorized, executed and delivered this Agreement, subject to Section 9.01 of this Agreement, this Agreement constitutes its legal, valid and binding obligations and is enforceable against it in accordance with its terms.

 

Sectin 5.02                                    Non-Contravention.  The execution, delivery, and performance by it of this Agreement is and will not be (a) in any breach or violation of or in conflict with any provisions of its articles of association or any other constitutional documents; or (b) in any breach or violation of the applicable Laws or the Government Orders.

 

Sectin 5.03                                    Financial Capacity and Performance Capacity.  As of the Payment Date, the Subscriber has sufficient and legal fund resources to enable it to subscribe for the New Shares in accordance with the terms and conditions of this Agreement and pay the Share Subscription Price on a timely basis in accordance with this Agreement.

 

38Exhibit 10.44

 

INVESTMENT AGREEMENT

 

dated as of August 9, 2015

 

by and between

 

ALIBABA GROUP HOLDING LIMITED

 

and

 

SUNING COMMERCE GROUP CO., LTD.

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE IDEFINITIONS   AND INTERPRETATION
    	
1
    
	
 
    	
 
    	
 
    
	
Section 1.01
    	
Definitions
    	
1
    
	
Section 1.02
    	
Interpretation and   Rules of Construction
    	
7
    
	
 
    	
 
    	
 
    
	
ARTICLE IIPURCHASE   AND SALE OF SECURITIES
    	
7
    
	
 
    	
 
    	
 
    
	
Section 2.01
    	
Purchase of Issued   Shares
    	
7
    
	
Section 2.02
    	
Determination of Number   of Issued Shares and Aggregate Purchase Price
    	
7
    
	
Section 2.03
    	
Payment of Purchase   Price
    	
8
    
	
Section 2.04
    	
Closing
    	
9
    
	
 
    	
 
    	
 
    
	
ARTICLE IIIREPRESENTATIONS   AND WARRANTIES OF THE PURCHASER
    	
9
    
	
 
    	
 
    	
 
    
	
Section 3.01
    	
Organization
    	
9
    
	
Section 3.02
    	
Authorization;   Enforcement; Validity
    	
9
    
	
Section 3.03
    	
No Conflicts
    	
10
    
	
Section 3.04
    	
Consents
    	
10
    
	
Section 3.05
    	
Litigation
    	
10
    
	
Section 3.06
    	
Status and Investment   Intent of the Purchaser
    	
10
    
	
Section 3.07
    	
Source of Funds
    	
11
    
	
Section 3.08
    	
Independent   Investigation
    	
11
    
	
Section 3.09
    	
Brokers and Finders
    	
11
    
	
 
    	
 
    	
 
    
	
ARTICLE IVREPRESENTATIONS   AND WARRANTIES OF THE COMPANY
    	
11
    
	
 
    	
 
    	
 
    
	
Section 4.01
    	
Organization and   Qualification
    	
12
    
	
Section 4.02
    	
Capitalization
    	
12
    
	
Section 4.03
    	
Subsidiaries
    	
12
    
	
Section 4.04
    	
Authorization;   Enforcement; Validity
    	
12
    
	
Section 4.05
    	
No Conflicts
    	
13
    
	
Section 4.06
    	
Consents
    	
13
    
	
Section 4.07
    	
Issuance of Issued   Shares
    	
13
    
	
Section 4.08
    	
Public Documents
    	
13
    
	
Section 4.09
    	
Compliance with Laws
    	
14
    
	
Section 4.10
    	
Financial Statements
    	
14
    
	
Section 4.11
    	
Undisclosed Liabilities
    	
15
    
	
Section 4.12
    	
Absence of Changes
    	
15
    

 

i

 

	
Section 4.13
    	
Litigation
    	
15
    
	
Section 4.14
    	
No Other   Representations
    	
16
    
	
Section 4.15
    	
Brokers and Finders
    	
16
    
	
 
    	
 
    	
 
    
	
ARTICLE VAGREEMENTS   OF THE PARTIES
    	
16
    
	
 
    	
 
    	
 
    
	
Section 5.01
    	
Further Assurances
    	
16
    
	
Section 5.02
    	
Responsibility to   Notify
    	
16
    
	
Section 5.03
    	
PRC Regulatory Filings
    	
16
    
	
Section 5.04
    	
Confidentiality; Public   Disclosure
    	
17
    
	
Section 5.05
    	
No Promotion
    	
17
    
	
Section 5.06
    	
Supplemental Listing   Application
    	
18
    
	
Section 5.07
    	
Purchaser Transfer   Restrictions
    	
18
    
	
 
    	
 
    	
 
    
	
ARTICLE VICONDITIONS   TO THE COMPANY’S OBLIGATION
    	
21
    
	
 
    	
 
    	
 
    
	
Section 6.01
    	
Representations and   Warranties; Covenants
    	
21
    
	
Section 6.02
    	
No Stop Order
    	
21
    
	
Section 6.03
    	
No Action
    	
21
    
	
Section 6.04
    	
PRC Regulatory Filings
    	
21
    
	
Section 6.05
    	
Onshore Investment
    	
22
    
	
Section 6.06
    	
Stand-by Letter of   Credit
    	
22
    
	
Section 6.07
    	
Officer’s Certificate
    	
22
    
	
 
    	
 
    	
 
    
	
ARTICLE VIICONDITIONS   TO THE PURCHASER’S OBLIGATION
    	
22
    
	
 
    	
 
    	
 
    
	
Section 7.01
    	
Representations and   Warranties; Covenants
    	
22
    
	
Section 7.02
    	
No Stop Order
    	
23
    
	
Section 7.03
    	
No Action
    	
23
    
	
Section 7.04
    	
No Material Adverse   Effect
    	
23
    
	
Section 7.05
    	
PRC Regulatory Filings
    	
23
    
	
Section 7.06
    	
Onshore Investment
    	
23
    
	
Section 7.07
    	
Company Officer’s   Certificate
    	
23
    
	
 
    	
 
    	
 
    
	
ARTICLE VIIITERMINATION
    	
23
    
	
 
    	
 
    	
 
    
	
Section 8.01
    	
Termination
    	
23
    
	
Section 8.02
    	
Effect of Termination
    	
24
    
	
 
    	
 
    	
 
    
	
ARTICLE IXINDEMNIFICATION
    	
24
    
	
 
    	
 
    	
 
    
	
Section 9.01
    	
Survival
    	
24
    
	
Section 9.02
    	
Indemnification
    	
24
    

 

ii

 

	
Section 9.03
    	
Limitation to Liability
    	
25
    
	
 
    	
 
    	
 
    
	
ARTICLE XMISCELLANEOUS
    	
26
    
	
 
    	
 
    	
 
    
	
Section 10.01
    	
Expenses
    	
26
    
	
Section 10.02
    	
Governing Law
    	
26
    
	
Section 10.03
    	
Dispute Resolution
    	
26
    
	
Section 10.04
    	
Counterparts
    	
26
    
	
Section 10.05
    	
Severability
    	
27
    
	
Section 10.06
    	
Entire Agreement
    	
27
    
	
Section 10.07
    	
Notices
    	
27
    
	
Section 10.08
    	
No Third Party   Beneficiaries
    	
28
    
	
Section 10.09
    	
Successors and Assigns
    	
28
    
	
Section 10.10
    	
Construction
    	
28
    
	
Section 10.11
    	
Further Assurances
    	
29
    
	
Section 10.12
    	
Adjustment of Share   Numbers
    	
29
    
	
Section 10.13
    	
Specific Performance
    	
29
    
	
Section 10.14
    	
Amendment; Waiver
    	
29
    
	
Section 10.15
    	
Language Version
    	
29
    

 

iii

 

INVESTMENT AGREEMENT

 

THIS INVESTMENT AGREEMENT (this “Agreement”), dated as of August 9, 2015, is made by and between ALIBABA GROUP HOLDING LIMITED, an exempted company with limited liability incorporated under the Laws of the Cayman Islands (the “Company”), and SUNING COMMERCE GROUP CO., LTD., a joint stock company incorporated under the Laws of the People’s Republic of China (the “Purchaser” and, together with the Company, the “Parties” and each a “Party”).

 

RECITALS

 

WHEREAS, the Company desires to issue, sell and deliver to the Purchaser, and the Purchaser desires to purchase and acquire from the Company, upon the terms and conditions set forth in this Agreement, certain Ordinary Shares of the Company (the “Offshore Investment”); and

 

WHEREAS, concurrently with the Parties’ execution and delivery of this Agreement, (i) 淘宝(中国)软件有限公司 (Taobao (China) Software Co., Ltd.), an Affiliate of the Company (the “Onshore Investor”) is entering into a Share Subscription Agreement with the Purchaser (as may be amended, supplemented or modified from time to time in accordance with the terms thereof, the “Onshore Investment Agreement”), pursuant to which, among other things, the Purchaser will issue, sell and deliver to the Onshore Investor, and the Onshore Investor will purchase and acquire from the Purchaser, upon the terms and conditions set forth in the Onshore Investment Agreement, certain shares of the Purchaser (the “Onshore Investment”), and (ii) the Onshore Investor is entering into a Business Cooperation Framework Agreement with the Purchaser (the “Business Cooperation Framework Agreement”), which agreement contemplates certain business cooperation between the Parties and/or their Affiliates, as applicable.

 

NOW, THEREFORE, in consideration of the premises set forth above, the mutual promises and covenants set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Purchaser hereby agree as follows:

 

ARTICLE I
 DEFINITIONS AND INTERPRETATION

 

Section 1.01                             Definitions.  In this Agreement, except to the extent otherwise provided or that the context otherwise requires:

 

“ADS” means the American Depositary Shares, each of which represents one (1) Ordinary Share, of the Company;

 

“Affiliate” means, with respect to any specified Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such specified Person;

 

“Aggregate Purchase Price” has the meaning set forth in Section 2.02(c);

 

1

 

“Agreement” has the meaning set forth in the Preamble;

 

“Bankruptcy and Equity Exception” has the meaning set forth in Section 3.02;

 

“Business Cooperation Framework Agreement” has the meaning set forth in the Recitals;

 

“Business Day” means any day that is not a Saturday, a Sunday or other day on which banks are required or authorized by Law to be closed in Nanjing, Hong Kong or New York;

 

“Closing” has the meaning set forth in Section 2.04(a);

 

“Closing Date” has the meaning set forth in Section 2.04(a);

 

“Company” has the meaning set forth in the Preamble;

 

“Company Bank Account” has the meaning set forth in Section 2.03(b);

 

“Company Competitors” has the meaning set forth in Section 5.07(d);

 

“Company Share Plans” means, collectively, all of the equity incentive plans of the Company as disclosed in the Public Documents;

 

“Company’s Bid” has the meaning set forth in Section 5.07(c)(iv);

 

“Confidentiality Agreement” has the meaning set forth in Section 5.04(a);

 

“Contract” means any agreement, contract, lease, indenture, instrument, note, debenture, bond, mortgage or deed of trust or other agreement, commitment, arrangement or understanding;

 

“Control” (including the terms “Controlled by” and “under common Control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, as trustee or executor, by contract or otherwise, including the ownership, directly or indirectly, of securities having the power to elect a majority of the board of directors or similar body governing the affairs of such Person or securities that represent a majority of the outstanding voting securities of such Person;

 

“Encumbrance” means any security interest, pledge, mortgage, lien, charge, claim, hypothecation, title defect, right of first option or refusal, right of preemption, third-party right or interests, put or call right, lien, adverse claim of ownership or use, or other encumbrance of any kind;

 

“Enumerated PRC Regulatory Filings” means (i) the filing with the National Development and Reform Commission of the PRC, (ii) the filing with the Ministry of Commerce of the PRC, and (iii) the registration with the State Administration of Foreign Exchange of the PRC, in each case, by the Purchaser in respect of the Offshore Investment;

 

2

 

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder;

 

“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession that are in effect from time to time, as codified and described in FASB Statement No. 18, the FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles, and applied consistently throughout the periods involved;

 

“Governmental Authority” means any federal, national, foreign, supranational, state, provincial, local, municipal or other political subdivision or other government, governmental, regulatory or administrative authority, agency, board, bureau, department, instrumentality or commission or any court, tribunal, judicial or arbitral body of competent jurisdiction or stock exchange;

 

“ICC Rules” has the meaning set forth in Section 10.03;

 

“Indemnified Liabilities” has the meaning set forth in Section 9.02(a);

 

“Initial Cash Payment Amount” has the meaning set forth in Section 2.03(b);

 

“Issued Shares” has the meaning set forth in Section 2.01;

 

“Judgment” has the meaning set forth in Section 3.05;

 

“knowledge” means, with respect to any party, the actual knowledge of such party’s executive officers (as defined in Rule 405 under the Securities Act);

 

“Law” means any federal, national, foreign, supranational, state, provincial or local statute, law, ordinance, regulation, rule, code, order, requirement or rule of law (including common law), official policy, rule or interpretation of any Governmental Authority with jurisdiction over the Company or the Purchaser, as the case may be;

 

“Long Stop Date” means the second anniversary of the date of this Agreement;

 

“Material Adverse Effect” means any material adverse effect on the business, properties, financial condition, assets or results of operations of the Company and its Subsidiaries, taken as a whole, provided, however, that in no event shall any of the following exceptions, alone or in combination with the other enumerated exceptions below, be deemed to constitute, nor shall be taken into account in determining whether a Material Adverse Effect has occurred: (i) any effect resulting from the announcement, pendency or consummation of the transactions contemplated by, or from compliance with the terms and conditions of, this Agreement, any other Transaction Document or any Onshore Transaction Document, (ii) any effect that results from changes generally affecting any of the principal industries in which the Company or its Subsidiaries operate, (iii) any effect that results from changes affecting general

 

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economic, financial, credit or securities market conditions in the PRC, the United States or globally, including changes in interest rates or foreign exchange rates, (iv) any pandemic, earthquake, typhoon, tornado or other natural disaster, declaration of war, act of terrorism, armed hostilities or other similar force majeure event, (v) changes in generally accepted accounting principles or any interpretation thereof that are applicable to the Company or any of its Subsidiaries, or changes in applicable Laws or any interpretation or enforcement thereof, (vi) actions taken (or omitted to be taken) at the request of or with the prior consent of the Purchaser, (vii) any failure to meet any internal or public projections, forecasts, or guidance, provided that the underlying causes that lead to any failure to meet any internal or public projections, forecasts, or guidance as set forth in (vii) may be taken into account in determining whether a Material Adverse Effect has occurred, or (viii) any change in the Company’s stock price or trading volume, in and of itself, provided that the underlying causes that lead to any change in the Company’s stock price or trading volume as set forth in (viii) may be taken into account in determining whether a Material Adverse Effect has occurred; provided, further, that with respect to clauses (ii), (iii) and (v), such change does not have a materially disproportionate adverse effect on the Company and its Subsidiaries, taken as a whole, compared to major competitors of the Company and its Subsidiaries or other companies of similar size operating in the principal industries in which the Company or its Subsidiaries operate;

 

“Material Subsidiary” means a Subsidiary of the Company that is listed in Exhibit 8.1 to the Company’s Annual Report on Form 20-F for the fiscal year ended March 31, 2015, filed with the SEC on June 25, 2015;

 

“Memorandum and Articles” means the Amended and Restated Memorandum and Articles of Association of the Company in effect from time to time;

 

“Measurement Date” has the meaning set forth in Section 4.02;

 

“NYSE” means the New York Stock Exchange;

 

“Offshore Investment” has the meaning set forth in the Recitals;

 

“Onshore Investment” has the meaning set forth in the Recitals;

 

“Onshore Investment Agreement” has the meaning set forth in the Recitals;

 

“Onshore Investor” has the meaning set forth in the Recitals;

 

“Onshore New Share Registration” means the issuance of the new shares in the Purchaser to, and the registration of such shares in the securities account of, the Onshore Investor pursuant to the Onshore Investment Agreement;

 

“Onshore New Share Registration Date” means the “New Share Registration Date” (新股登记日) as defined in the Onshore Investment Agreement, being the date on which the Onshore New Share Registration occurs;

 

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“Onshore Payment” means the payment by the Onshore Investor of the purchase price for the new shares in the Purchaser to be issued to the Onshore Investor pursuant to the Onshore Investment Agreement;

 

“Onshore Payment Date” means the “Payment Date” (支付日) as defined in the Onshore Investment Agreement, being the date on which the Onshore Payment occurs;

 

“Onshore Purchase Price” means the aggregate amount of the purchase price for the Onshore Investment pursuant to the Onshore Investment Agreement;

 

“Onshore Transaction Documents” means the Onshore Investment Agreement, the Strategic Cooperation Agreement and each of the other agreements and documents entered into or delivered by the parties thereto or their respective Affiliates in connection with the transactions contemplated by the Onshore Investment Agreement;

 

“Ordinary Shares” has the meaning set forth in Section 4.02;

 

“Party” or “Parties” has the meaning set forth in the Preamble;

 

“Per Share Issue Price” has the meaning set forth in Section 2.01;

 

“Permits” has the meaning set forth in Section 4.09;

 

“Permitted Transfers” means (i) Transfers to a wholly-owned Subsidiary of the Purchaser, and (ii) Transfers to the depository bank of the Company for purposes of converting the Issued Shares into ADSs to be issued and registered in the name of the Purchaser or a wholly-owned Subsidiary of the Purchaser;

 

“Person” means any individual, partnership, corporation, association, joint stock company, trust, joint venture, limited liability company, organization, entity or Governmental Authority;

 

“PRC” means the People’s Republic of China, excluding, for purposes of this Agreement, Hong Kong, Macau and Taiwan;

 

“PRC Regulatory Filings” has the meaning set forth in Section 5.03;

 

“Proceedings” has the meaning set forth in Section 3.05;

 

“Public Documents” has the meaning set forth in Section 4.08;

 

“Purchaser” has the meaning set forth in the Preamble;

 

“Purchaser Designee” has the meaning set forth in Section 10.09;

 

“Relevant Exchange Rate” has the meaning set forth in Section 2.02(a)(i);

 

“Relevant Trading Day” has the meaning set forth in Section 5.07(b)(i);

 

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“RMB” means Renminbi, the lawful currency of the PRC;

 

“RMB Aggregate Purchase Price” ha the meaning set forth in Section 2.02(a)(ii);

 

“ROFO Notice” has the meaning set forth in Section 5.07(c)(ii);

 

“ROFO Notice Period” has the meaning set forth in Section 5.07(c)(iii);

 

“ROFO Securities” has the meaning set forth in Section 5.07(c)(i);

 

“ROFO Transferor” has the meaning set forth in Section 5.07(c)(i);

 

“ROFR Election Period” has the meaning set forth in Section 5.07(b)(ii);

 

“ROFR Exercise Notice” has the meaning set forth in Section 5.07(b)(ii);

 

“ROFR Offer Notice” has the meaning set forth in Section 5.07(b)(i);

 

“ROFR Sale Proposal” has the meaning set forth in Section 5.07(b)(i);

 

“ROFR Sale Window” has the meaning set forth in Section 5.07(b)(i);

 

“ROFR Securities” has the meaning set forth in Section 5.07(b)(i);

 

“SBLC” has the meaning set forth in Section 2.03(a);

 

“SBLC Amount” has the meaning set forth in Section 2.03(a);

 

“SBLC Expiry Date” has the meaning set forth in Section 2.03(a);

 

“SEC” means the U.S. Securities and Exchange Commission;

 

“Securities” means any Ordinary Shares or any equity interest of, or shares of any class in the share capital (ordinary, preferred or otherwise) of, the Company and any convertible securities, options, warrants and any other type of equity or equity-linked securities convertible, exercisable or exchangeable for any such equity interest or shares of any class in the share capital of the Company;

 

“Securities Act” means the U.S. Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder;

 

“Subsidiary” of any Person means any corporation, partnership, limited liability company, joint stock company, joint venture or other organization or entity, whether incorporated or unincorporated, which is Controlled by such Person;

 

“Supplemental Listing Application” has the meaning set forth in Section 5.06;

 

“Trading Day” means a day (U.S. Eastern Time) on which the NYSE is open for trading.

 

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“Transaction Documents” mean this Agreement and each of the other agreements and documents entered into or delivered by the parties hereto or their respective Affiliates in connection with the transactions contemplated by this Agreement;

 

“Transfer” means, with respect to any Securities, the direct or indirect transfer, sale, assignment, pledge, mortgage, grant of a security interest or other disposal of, or granting or permitting any Encumbrance on such Securities, and “Transfers”; “Transferring” and “Transferred” shall have correlative meanings;

 

“U.S.” or “United States” means the United States of America; and

 

“US$” or “USD” means United States dollars, the lawful currency of the United States.

 

Section 1.02                             Interpretation and Rules of Construction.  In this Agreement, except to the extent otherwise provided or that the context otherwise requires:

 

(a)                                 when a reference is made in this Agreement to an Article or Section, such reference is to an Article or Section of this Agreement;

 

(b)                                 the headings for this Agreement are for reference purposes only and do not affect in any way the meaning or interpretation of this Agreement;

 

(c)                                  the words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, refer to this Agreement as a whole and not to any particular provision of this Agreement;

 

(d)                                 all terms defined in this Agreement have the defined meanings when used in any certificate or other document made or delivered pursuant hereto, unless otherwise defined therein;

 

(e)                                  the definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms;

 

(f)                                   references to a Person are also to its successors and permitted assigns; and

 

(g)                                  the use of the term “or” is not intended to be exclusive.

 

ARTICLE II
 PURCHASE AND SALE OF SECURITIES

 

Section 2.01                             Purchase of Issued Shares.  Subject to the conditions and on the terms of this Agreement, on the Closing Date, the Company shall issue and sell to the Purchaser, and the Purchaser shall subscribe for and purchase from the Company, such number of Ordinary Shares to be determined pursuant to Section 2.02 (the “Issued Shares”) for a purchase price per Ordinary Share of US$81.51 (the “Per Share Purchase Price”).

 

Section 2.02                             Determination of Number of Issued Shares and Aggregate Purchase Price.

 

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(a)                                 For purposes hereof,

 

(i)                                     “Relevant Exchange Rate” shall mean the USD:RMB middle exchange rate last published by China Foreign Exchange Trade System under the authorization of the People’s Bank of China as of the date that is five (5) Business Days prior to the Onshore Payment Date; and

 

(ii)                                  “RMB Aggregate Purchase Price” shall mean the lower of (x) 50% of the Onshore Purchase Price, and (y) RMB14,000,000,000.

 

(b)                                 The number of Issued Shares shall be the lower of (i) 27,800,000, and (ii) the USD equivalent of the RMB Aggregate Purchase Price (calculated at the Relevant Exchange Rate) divided by the Per Share Purchase Price (rounded down to the nearest whole Ordinary Share).

 

(c)                                  The total purchase price for all of the Issued Shares (the “Aggregate Purchase Price”) shall be an amount, denominated in USD, equal to the number of Issued Shares determined pursuant to Section 2.02 multiplied by the Per Share Purchase Price .

 

Section 2.03                             Payment of Purchase Price.

 

(a)                                 On the Onshore Payment Date and concurrently with the payment by the Onshore Investor of the Onshore Purchase Price, the Purchaser shall cause to be issued and delivered to the Company an irrevocable, unconditional, US$ denominated stand-by letter of credit (the “SBLC”) in favor of the Company in form and substance satisfactory to the Company and issued by an internationally reputable bank acceptable to the Company with (i) a USD denominated face value amount of not less than the shortfall of the Initial Cash Payment Amount (as defined below) from the Aggregate Purchase Price (the “SBLC Amount”); and (ii) an expiry date which is no earlier than the date that is 30 Business Days after the Onshore Payment Date (the “SBLC Expiry Date”).

 

(b)                                 As soon as practicable after the Onshore Purchase Price has been received by the Purchaser, and in any event prior to the Closing, the Purchaser shall, in accordance with Section 2.03(c), pay the Company by wire transfer of immediately available USD funds in an amount not less than RMB5,400,000,000 equivalent (calculated at the Relevant Exchange Rate) which amount will be notified by the Purchaser in writing to the Company at least one (1) Business Day prior to the Onshore Payment Date (the “Initial Cash Payment Amount”) to a bank account (the “Company Bank Account”) designated in writing by the Company at least five (5) Business Days prior to the Onshore Payment Date.

 

(c)                                  The Purchaser shall ensure that, within five (5) Business Days after the Purchaser has received the Onshore Payment, an amount equal to RMB equivalent of the Initial Cash Payment Amount (from the proceeds it receives from the Onshore Investment or otherwise) be in an onshore RMB bank account of the Purchaser available to be remitted to the Company pending currency exchange and remittance procedures at the applicable financial institutions, and shall otherwise use its best efforts to procure that the Initial Cash Payment Amount is received by the Company in the Company Bank Account no later than the Onshore New Share Registration Date.

 

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(d)                                 The Purchaser hereby irrevocably undertakes to pay to the Company (subject only to the satisfaction or waiver by the Purchaser, at or before the Onshore Payment Date, of each of the conditions set forth in ARTICLE VII) by wire transfer of immediately available USD funds to the Company Bank Account, an amount equal to the SBLC Amount as soon as practicable after the Onshore Payment Date and in any event no later than 5 Business Days prior to the SBLC Expiry Date, and the Company shall be entitled to draw on the SBLC for its full amount in the event that the Company shall not have received such amount in the Company Bank Account as of the 5th Business Day prior to the SBLC Expiry Date.

 

Section 2.04                             Closing.

 

(a)                                 Date and Time.  The closing of the Offshore Investment (the “Closing”) shall take place at the offices of Simpson Thacher & Bartlett, ICBC Tower, 3 Garden Road, Central, Hong Kong, on the latest of the Onshore New Share Registration Date, the date on which the Company has received the Initial Cash Payment Amount, and the date on which the SBLC has been delivered, or on such other date and time as may be mutually agreed in writing by the Parties.  The date on which the Closing occurs is referred to herein as the “Closing Date.”

 

(b)                                 Closing Delivery.  At the Closing, and subject to the Purchaser having complied with its obligations set forth in Section 2.03(b) and, if the Purchaser has not paid the Aggregate Purchase Price to the Company in cash in full as of such time, the SBLC remaining in full force and effect, the Company shall deliver to the Purchaser: (i) a share certificate representing the Issued Shares, duly executed on behalf of the Company and registered in the name of the Purchaser (or, if applicable, the Purchaser Designee); and (ii) a certified copy of the register of members of the Company, reflecting the Purchaser’s (or, if applicable, the Purchaser Designee’s) ownership of the Issued Shares.

 

ARTICLE III
 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

 

The Purchaser represents and warrants to the Company as of the date hereof and as of the Onshore Payment Date (or, if a representation or warranty is made as of a specified date, as of such date) that:

 

Section 3.01                             Organization.  The Purchaser is a joint stock company duly incorporated, validly existing and in good standing under the Laws of the PRC and has the requisite corporate power and authorization to own, lease and operate its properties and to carry on its business as now being conducted.

 

Section 3.02                             Authorization; Enforcement; Validity.  The Purchaser has the requisite corporate power and authority to execute and deliver this Agreement and the other Transaction Documents to which it is a party and perform its obligations under this Agreement and such other Transaction Documents in accordance with the terms hereof.  The execution, delivery and performance of this Agreement and the other Transaction Documents to which the Purchaser is a party and the consummation of the transactions contemplated hereby and thereby have been duly and validly authorized by all requisite corporate action by the Purchaser.  This Agreement has been, and the other Transaction Documents to which the Purchaser is a party will be, duly

 

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executed and delivered by the Purchaser, and, assuming the due authorization, execution and delivery by the Company, constitutes a legal, valid and binding obligation of the Purchaser, enforceable against the Purchaser in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors’ rights and to general equity principles (the “Bankruptcy and Equity Exception”).

 

Section 3.03                             No Conflicts.  The execution, delivery and performance by the Purchaser of this Agreement and the other Transaction Documents to which it is a party and the consummation by the Purchaser of the transactions contemplated hereby and thereby will not (a) result in a violation of the articles of association of the Purchaser, (b) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any Contract to which the Purchaser is a party, or (c) result in a violation of any Law applicable to the Purchaser or by which any property or asset of the Purchaser is bound or affected, except in the case of clauses (b) and (c) above, for such violations which would not, individually or in the aggregate, have a material adverse effect on the ability of the Purchaser to consummate the transactions contemplated hereunder and under the Onshore Transaction Documents.

 

Section 3.04                             Consents.  In connection with the entering into and performance of this Agreement and the other Transaction Documents to which it is a party, the Purchaser is not required to obtain any consent, authorization or order of, or make any filing or registration with, (a) any Governmental Authority in order for it to execute, deliver or perform any of its obligations under or contemplated by this Agreement and the other Transaction Documents to which it is a party, or (b) any third party pursuant to any agreement, indenture or instrument to which the Purchaser is a party, in each case in accordance with the terms hereof or thereof other than such as have been made or obtained except, in each case, for the PRC Regulatory Filings and such other consents, authorizations, orders, filings or registrations that, if not obtained or made, would not, individually or in the aggregate, have a material adverse effect on the ability of the Purchaser to consummate the transactions contemplated hereunder and under the Onshore Transaction Documents.

 

Section 3.05                             Litigation.  As of the date hereof, there are no pending or, to the Purchaser’s knowledge, threatened, legal, administrative, arbitral or other claims, suits, actions or proceedings or governmental or regulatory investigations (“Proceedings”) of any nature against the Purchaser or any of its Subsidiaries, which would, individually or in the aggregate, have a material adverse effect on the Purchaser’s ability to consummate the transactions contemplated hereunder and under the Onshore Transaction Documents.  There is no judgment, order, injunction or decree (“Judgment”) outstanding against the Purchaser or any of its Subsidiaries, except for any Judgment which would not, individually or in the aggregate, have a material adverse effect on the Purchaser’s ability to consummate the transactions contemplated hereunder and under the Onshore Transaction Documents.

 

Section 3.06                             Status and Investment Intent of the Purchaser.

 

(a)                                 Not a U.S. Person.  The Purchaser is not a “U.S. person” within the meaning of Regulation S under the Securities Act.

 

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(b)                                 Experience.  The Purchaser (i) has sufficient knowledge and experience in financial and business matters to be capable of evaluating the merits and risks involved in purchasing the Issued Shares and (ii) is capable of bearing the economic risk of the Offshore Investment.

 

(c)                                  No Public Sale or Distribution.  The Purchaser is acquiring the Issued Shares for its own account and not with a view towards, or for resale in connection with, the public sale or distribution thereof, except pursuant to sales registered or exempted under the Securities Act.  The Purchaser does not have any agreement or understanding, directly or indirectly, with any Person to distribute any of the Issued Shares.  The Purchaser is not a broker-dealer registered with the SEC under the Exchange Act or an entity engaged in a business that would require it to be so registered as a broker-dealer.

 

(d)                                 Restricted Securities.  The Purchaser acknowledges that the Issued Shares are “restricted securities” (within the meaning of Rule 144 of the Securities Act) that have not been registered under the Securities Act or any applicable state securities law and may not be offered or sold except pursuant to registration or to an exemption from the registration statements of the Securities Act.

 

(e)                                  Share Ownership.  The Purchaser does not beneficially own any Ordinary Shares or any other Securities of the Company.

 

Section 3.07                             Source of Funds.  The funds used by the Purchaser to pay the Aggregate Purchase Price are not directly or (to the knowledge of the Purchaser) indirectly derived from activities that contravene applicable anti-money laundering Laws.

 

Section 3.08                             Independent Investigation.  The Purchaser has conducted its own independent investigation, review and analysis of the business, operations, assets, liabilities, results of operations, financial condition and prospects of the Company and its Subsidiaries, which investigation, review and analysis was done by the Purchaser and its Affiliates and representatives.  In entering into this Agreement, the Purchaser acknowledges that the Company and its representatives have not made any representations, warranties, estimates or projections, and it has not relied on any representations, warranties, estimates or projections of the Company or its representatives, other than the specific representations and warranties of the Company set forth in ARTICLE IV.

 

Section 3.09                             Brokers and Finders.  Neither the Purchaser nor any of its Affiliates is a party to any agreement, arrangement or understanding with any Person (other than Goldman Sachs Gao Hua Securities Company Limited and CITIC Securities Company Limited or their respective Affiliates) that would give rise to any valid right, interest or claim against or upon the Company or the Purchaser for any brokerage commission, finder’s fee or other similar compensation, as a result of the transactions contemplated by the Transaction Documents.

 

ARTICLE IV
 REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

The Company represents and warrants to the Purchaser as of the date hereof and as of the Onshore Payment Date (or, if a representation or warranty is made as of a specified date, as of

 

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such date) that, except as set forth in its Public Documents filed or furnished prior to the date hereof (excluding disclosure of non-specific risks included in any forward-looking statement, disclaimer or risk factor disclosure contained in its Public Documents, but without excluding any factual information disclosed therein):

 

Section 4.01                             Organization and Qualification.  The Company is an exempted company duly incorporated, validly existing and in good standing under the Laws of the Cayman Islands, and has the requisite corporate power and authorization to own, lease and operate its properties and to carry on its business as now being conducted.  The Company is duly qualified or licensed to do business in each jurisdiction in which the property owned, leased or operated by it or the nature of the business conducted by it makes such qualification or licensing necessary, except where the failure to be so qualified or licensed would not, individually or in the aggregate, have a Material Adverse Effect.

 

Section 4.02                             Capitalization.  As of the date of this Agreement, the authorized share capital of the Company is US$100,000 divided into 4,000,000,000 ordinary shares of a par value of US$0.000025 each (the “Ordinary Shares”).  As of March 31, 2015 (the “Measurement Date”), (i) 2,495,499,036 Ordinary Shares were issued and outstanding, (ii) 16,775,577 Ordinary Shares were issuable upon exercise of options issued and outstanding pursuant to the Company Share Plans, (iii) 77,890,207 Ordinary Shares were subject to unvested restricted share units issued and outstanding pursuant to the Company Share Plans, and (iv) 22,111,169 Ordinary Shares were authorized for issuance pursuant to the Company’s 2014 Post-IPO Equity Incentive Plan.  From the Measurement Date to the date of this Agreement, other than the issuance of Ordinary Shares pursuant to the exercise of options issued pursuant to the Company Share Plans or settlement of restricted shares or restricted share units issued pursuant to the Company Share Plans, no other Ordinary Shares, options, restricted shares or restricted share units have been issued by the Company. Except as set forth in this Section 4.02, as of the Measurement Date, no Securities convertible into or exchangeable or exercisable for any Ordinary Shares are outstanding.

 

Section 4.03                             Subsidiaries.  Each Material Subsidiary has been duly organized, is validly existing and in good standing (with respect to jurisdictions that recognize the concept of good standing) under the Laws of its jurisdiction of organization, and has the requisite corporate power and authorization to own, lease and operate its properties and to carry on its business as now being conducted.  Each Material Subsidiary is duly qualified or licensed to do business in each jurisdiction in which the property owned, leased or operated by it or the nature of the business conducted by it makes such qualification or licensing necessary, except where the failure to be so qualified or licensed would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

Section 4.04                             Authorization; Enforcement; Validity.  The Company has the requisite corporate power and authority to execute and deliver this Agreement and the other Transaction Documents to which it is a party and perform its obligations under this Agreement and such other Transaction Documents in accordance with the terms hereof.  The execution, delivery and performance of this Agreement and the other Transaction Documents to which the Company is a party and the consummation of the transactions contemplated hereby and thereby have been duly and validly authorized by all requisite corporate action by the Company, and no other filing,

 

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consent or authorization on the part of the Purchaser is necessary to authorize or approve this Agreement or the other Transaction Documents or, other than any required filing or notification with the SEC or the NYSE regarding the issuance of the Issued Shares, to consummate the transactions contemplated hereby or thereby.  This Agreement has been, and the other Transaction Documents to which the Company is a party will be, duly executed and delivered by the Company, and, assuming the due authorization, execution and delivery by the Purchaser, constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to the Bankruptcy and Equity Exception.

 

Section 4.05                             No Conflicts.  The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party and the consummation by the Company of the transactions contemplated hereby and thereby will not (a) result in a violation of the Memorandum and Articles, (b) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any Contract to which the Company or any of its Subsidiaries is a party, or (c) result in a violation of any Law applicable to the Company or by which any property or asset of the Company or any of its Subsidiaries is bound or affected, except in the case of clauses (b) and (c) above, for such conflicts, defaults, rights or violations which, individually or in the aggregate, would not result in a Material Adverse Effect.

 

Section 4.06                             Consents.  In connection with the entering into and performance of this Agreement and the other Transaction Documents to which the Company is a party, subject to the accuracy of the warranties of the Purchaser in Section 3.06, the Company is not required to obtain any consent, authorization or order of, or make any filing or registration with, (a) any Governmental Authority in order for it to execute, deliver or perform any of its obligations under or contemplated hereby or thereby or (b) any third party pursuant to any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party, in each case in accordance with the terms hereof or thereof other than such as have been made or obtained, and except for (i) any required filing or notification with the SEC or the NYSE regarding the issuance of the Issued Shares (including the Supplemental Listing Application), and (ii) such consents, authorizations, orders, filings or registrations that, if not obtained or made, would not, individually or in the aggregate, result in a Material Adverse Effect.

 

Section 4.07                             Issuance of Issued Shares.  The Issued Shares are duly authorized, and, when issued and paid for in accordance with the terms hereof and entered in the register of members of the Company, will be validly issued, non-assessable and fully-paid, and free from all Encumbrances (except for Encumbrances created or imposed by the Transaction Documents or under applicable securities Laws).  Assuming the accuracy of the representations and warranties set forth in Section 3.06, the offer, issuance and sale by the Company of the Issued Shares to the Purchaser is exempt from registration under the Securities Act.

 

Section 4.08                             Public Documents.  The Company has timely filed or furnished, as applicable, all reports, schedules, forms, statements and other documents required to be filed or furnished by it with the SEC pursuant to the Securities Act or the Exchange Act (all of the foregoing documents filed with or furnished to the SEC and all exhibits included therein and financial statements, notes and schedules thereto and documents incorporated by reference

 

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therein being hereinafter referred to as the “Public Documents”).  As of their respective filing or furnishing dates pursuant to the Exchange Act (and to the extent such Public Documents were amended, as of the date of filing of such amendment) and as of the date of effectiveness in the case of Public Documents filed pursuant to the Securities Act, the Public Documents (a) complied as to form in all material respects with the requirements of the Securities Act or the Exchange Act, as the case may be, and the rules and regulations of the SEC promulgated thereunder, as applicable, and (b) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.  As of the date of this Agreement, there are no outstanding or unresolved comment letters received from the SEC or its staff with respect to any Public Document.

 

Section 4.09                             Compliance with Laws.  The business of the Company and its Subsidiaries is not being conducted, and has not been conducted at any time during the three years prior to the date hereof, in violation of any applicable Laws (including, without limitation, the U.S. Foreign Corrupt Practices Act, as amended, and PRC anti-bribery laws) or government order applicable to the Company except for violations which would not, individually or in the aggregate, result in a Material Adverse Effect.  Except as disclosed in the Public Documents, the Company or its relevant Subsidiaries have all permits, licenses, authorizations, consents, orders and approvals (collectively, the “Permits”) required under applicable Laws to carry on their business as presently conducted, except where the failure to have such Permits would not result in a Material Adverse Effect. Except as disclosed in the Public Documents, all such Permits are in full force and effect and, to the knowledge of the Company, no suspension or cancellation of any of them is threatened, except where such failure to be in full force and effect, or such suspension or cancellation, would not result in a Material Adverse Effect. The Company is in compliance in all material respects with the applicable listing and corporate governance rules and regulations of the NYSE. The Company and its Subsidiaries have taken no steps to delist the ADSs from the NYSE. As of the date of this Agreement, the Company has not received any notification from the SEC or the NYSE indicating that the SEC or the NYSE, as applicable, is contemplating suspending or terminating the listing of the ADSs (or the applicable registration under the Exchange Act related thereto).

 

Section 4.10                             Financial Statements.  As of their respective dates, the financial statements of the Company included in the Public Documents complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto.  The consolidated financial statements of the Company (including any related notes thereto) included or incorporated by reference in the Public Documents fairly presented in all material respects the consolidated financial position of the Company as of the dates indicated therein and the consolidated results of its operations, cash flows and changes in shareholders’ equity for the periods specified therein, other than as corrected or clarified in a subsequent Public Document.  Such financial statements were prepared in accordance with GAAP applied on a consistent basis (except (a) as may be otherwise indicated in such financial statements or the notes thereto, or (b) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed to summary statements or subject to recurring year-end adjustments).

 

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Section 4.11                             Undisclosed Liabilities.  Since March 31, 2015, the Company and its Subsidiaries do not have any liabilities or obligations that would be required to be disclosed on a consolidated balance sheet of the Company in accordance with GAAP, other than (a) liabilities or obligations reflected on, reserved against, or disclosed in the Company’s balance sheet as of March 31, 2015 included in the Public Documents (excluding those liabilities or obligations discharged or paid in full prior to the date of this Agreement), (b) liabilities or obligations that would not, individually or in the aggregate, have a Material Adverse Effect, and (c) liabilities incurred since March 31, 2015 in the ordinary course of business consistent with past practices and any liabilities incurred pursuant to this Agreement.

 

Section 4.12                             Absence of Changes.  Except for the execution and performance of this Agreement, the other Transaction Documents, the Onshore Transaction Documents and the discussions, negotiations and transactions related hereto and thereto, since March 31, 2015, the Company and its Subsidiaries have conducted their respective businesses in all material respects in the ordinary course of business consistent with past practice and there has not been:

 

(a)                                 any Material Adverse Effect;

 

(b)                                 any amendment to the Memorandum and Articles;

 

(c)                                  any sale of all or substantially all of the assets of the Company and its Subsidiaries, taken as a whole;

 

(d)                                 any merger or consolidation of the Company or any Material Subsidiary with or into another Person;

 

(e)                                  (i) any declaration, setting aside or payment of any dividend or other distribution with respect to any share capital of the Company or any Material Subsidiary (except for dividends or other distributions by any Subsidiary to the Company or to any of the Company’s wholly owned Subsidiaries), or (ii) any redemption, repurchase or other acquisition of any share capital of the Company or any Material Subsidiary;

 

(f)                                   any adoption of resolution to approve or petition or similar proceeding or order in relation to a plan of complete or partial liquidation, dissolution, scheme of arrangement, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any Material Subsidiary;

 

(g)                                  any receiver, trustee, administrator or other similar Person appointed in relation to the affairs of the Company or its property or any material part thereof; or

 

(h)                                 any agreement to carry out any of the foregoing.

 

Section 4.13                             Litigation.  As of the date hereof, there are no pending or, to the Company’s knowledge, threatened, Proceedings of any nature against the Company or any of its Subsidiaries, which would, individually or in the aggregate, have a Material Adverse Effect.  There is no Judgment outstanding against the Company or any of its Subsidiaries, except for any Judgment which would not, individually or in the aggregate, have a Material Adverse Effect.

 

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Section 4.14                             No Other Representations.  In entering into this Agreement, the Company acknowledges that the Purchaser and its representatives have not made any representations, warranties, estimates or projections, and it has not relied on any representations, warranties, estimates or projections of the Purchaser or its representatives, other than the specific representations and warranties of the Purchaser set forth in ARTICLE III.

 

Section 4.15                             Brokers and Finders.  Neither the Company nor any of its Affiliates is a party to any agreement, arrangement or understanding with any Person (other than China International Capital Corporation Limited or its Affiliates) that would give rise to any valid right, interest or claim against or upon the Purchaser or the Company for any brokerage commission, finder’s fee or other similar compensation, as a result of the transactions contemplated by the Transaction Documents.

 

ARTICLE V
 AGREEMENTS OF THE PARTIES

 

Section 5.01                             Further Assurances.  Each Party shall use its reasonable best efforts to fulfill or obtain the fulfillment of the conditions precedent to its obligation to consummate the transactions contemplated by this Agreement on a timely basis, including the execution and delivery of any documents, certificates, instruments or other papers that are reasonably required for the consummation of such transactions, and will cooperate and consult with the other and use its reasonable best efforts to prepare and file all necessary documentation, to effect all necessary applications, notices, petitions, filings and other documents, and to obtain all necessary permits of, or any exemption by, all Governmental Authorities, necessary or advisable to consummate the transactions contemplated by this Agreement.

 

Section 5.02                             Responsibility to Notify.  From the date hereof through the Closing Date, the Parties shall promptly notify each other in writing of any event, condition or circumstances occurring from the date hereof through the Closing Date which would, or would reasonably be expected to, (a) result in any conditions set forth in ARTICLE VI or ARTICLE VII not to be satisfied, or (b) result in any material violation of any provision of this Agreement.  If a notice of any matter pursuant to this Section 5.02 contains an express admission by the notifying Party that such matter has caused or will cause any conditions set forth in ARTICLE VI (if the notifying Party is the Purchaser) or ARTICLE VII (if the notifying Party is the Company) to be incapable of being satisfied on or prior to the Long Stop Date, and the receiving Party nevertheless proceeds to consummate the Offshore Investment, the receiving Party shall be deemed to have irrevocably waived its right to indemnification pursuant to ARTICLE IX with respect to the matter set forth in such notice.

 

Section 5.03                             PRC Regulatory Filings.  The Purchaser shall, as soon as practicable after the date hereof, duly make all filings necessary under applicable PRC Laws (including, for the avoidance of doubt, the Enumerated PRC Regulatory Filings) in respect of the Offshore Investment and the transactions contemplated by the Transaction Documents (the “PRC Regulatory Filings”). Following each PRC Regulatory Filing, the Purchaser shall (i) promptly notify the Company of such PRC Regulatory Filing, (ii) use reasonable best efforts to promptly complete such PRC Regulatory Filing and obtain written confirmation or acceptance thereof from the applicable Governmental Authority as soon as practicable, and (iii) upon such PRC

 

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Regulatory Filing having been confirmed or accepted by the applicable Governmental Authority, promptly notify the Company of such confirmation or acceptance and provide proof thereof.  The Parties shall reasonably cooperate with each other (including furnishing to each other all necessary information) in connection with the preparation and making of the PRC Regulatory Filings and resolving any investigation or other inquiry of any Governmental Authority in connection therewith.  The Purchaser shall promptly inform the Company of any material communication with any Governmental Authority regarding any PRC Regulatory Filing with reasonable details and, to the extent reasonably practicable, provide advanced notice to the Company in respect of, and permit representatives of the Company to participate in, any meeting with any Governmental Authority in respect of any such filing, investigation or other inquiry.

 

Section 5.04                             Confidentiality; Public Disclosure.

 

(a)                                 The confidentiality terms of the confidentiality agreement dated as of August 7, 2015 (the “Confidentiality Agreement”) between the Parties are hereby incorporated herein by reference and shall continue in full force and effect until the first anniversary of the Closing Date or, if this Agreement is terminated prior to the Closing, until the first anniversary of such termination.

 

(b)                                 Without limiting any other provision of this Agreement, the Parties will, to the extent permitted by applicable Law, consult with each other before issuance, and provide each other the opportunity to review, comment upon and concur with, and use all reasonable efforts to agree on, any press release or public statement with respect to this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby, and will not (to the extent practicable) issue any such press release or make any such public statement prior to such consultation and agreement, except as may be required by Law or an applicable securities exchange, provided that the disclosing Party shall, to the extent permitted by applicable Law or the applicable securities exchange and if reasonably practicable, inform the other Party about the disclosure to be made pursuant to such requirements prior to the disclosure.

 

Section 5.05                             No Promotion.

 

(a)                                 Except as required for conducting ordinary course of business cooperation between the Company and/or its Affiliates on the one hand and the Purchaser and/or its Affiliates on the other than (and in compliance with the terms and conditions of such cooperation), without the prior written consent of or otherwise agreed in writing to by the Company, and whether or not the Closing is consummated, the Purchaser shall not, and shall procure that its Affiliates do not use for advertising or promotion purposes, the name of the Company or any Affiliate of the Company, either alone or in combination, including “阿里巴巴” (Chinese equivalent for “Alibaba”), “淘宝” (Chinese equivalent for “Taobao”), “阿里” (Chinese equivalent for “Ali”), “全球速卖通” (Chinese brand for “AliExpress”), “淘” (Chinese equivalent for “Tao”), “天猫” (Chinese equivalent for “Tmall”), “一淘” (Chinese equivalent for “eTao”), “聚划算” (Chinese equivalent for “Juhuasuan”), “阿里旅行 去啊” (Chinese equivalent for “Alitrip”), “阿里妈妈” (Chinese equivalent for “Alimama”), “阿里云” (Chinese equivalent for “Aliyun”), “云OS” (Chinese equivalent for “YunOS”), “万网” (Chinese brand for “HiChina”), “口碑” (Chinese equivalent for “Koubei”), “虾米” (Chinese equivalent for “Xiami”), “蚂蚁金服” (Chinese brand

 

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for “Ant Financial”), “蚂蚁” (Chinese brand for “Ant”), “支付宝” (Chinese brand for “Alipay”), “小微金服” (Chinese equivalent for “Xiao Wei Jin Fu”), “1688”, “来往” (Chinese equivalent for “Laiwang”), “一达通” (Chinese equivalent for “OneTouch”), “友盟” (Chinese equivalent for “Umeng”), “酷盘” (Chinese equivalent for “Kanbox/ Kupan”), “天天动听” (Chinese equivalent for “TTPOD”), “优视” (Chinese equivalent for “UC / UCWeb”), “高德” (Chinese equivalent for “AutoNavi”), “去啊” (Chinese equivalent for “Alitrip”), “钉钉” (Chinese equivalent for “DingTalk”), “余额宝” (Chinese equivalent for “Yu’e Bao”),”招财宝” (Chinese equivalent for “Zhaocaibao”), “芝麻信用” (Chinese equivalent for “Sesame Credit”), “Alibaba”, “Taobao”, “Ali”, “AliExpress”, “Tao”, “Tmall”, “eTao”, “Juhuasuan”, “Alimama”, “Aliyun”, “YunOS”, “HiChina”, “Koubei”, “Xiami”, “Ant Financial”, “Ant”, “Alipay”, “Xiao Wei Jin Fu”, “Laiwang”, “OneTouch”, Umeng”, “Kanbox”, “Kupan”, “TTPOD”, “UCWeb”, “UC”, “AutoNavi”, “Alitrip”, “DingTalk”, “Yu’e Bao”, “Zhaocaibao”, “Sesame Credit”, “11 Main”, the associated devices and logos of the above brands (including but not limited to the smiling face device of Alibaba Group , cow device of Alibaba.com, ant device of Taobao, Tao doll device of Taobao, cat device of Tmall, Juxiaomeng device of Juhuasuan, ant device of Ant Financial, lion device of Alipay, Zhixiaobao device of Alipay, ingot device of Zhaocaibao and sesame device of Sesame Credit).

 

(b)                                 Except as required for conducting ordinary course of business cooperation between the Company and/or its Affiliates on the one hand and the Purchaser and/or its Affiliates on the other than (and in compliance with the terms and conditions of such cooperation), without the prior written consent of or otherwise agreed in writing to by the Purchaser, and whether or not the Closing is consummated, the Company shall not, and shall procure that its Affiliates do not use for advertising, publicity or promotion purposes, the name of the Purchaser or any Affiliate of the Purchaser, either alone or in combination, including “苏宁”, “苏宁易购”, “苏宁云商”, “乐购仕 , “LAOX”, “易付宝”, “Suning”, “苏宁阅读”, “IT帮客”, “红孩子”, “Red Baby” and the associated devices and logos of the above brands.

 

(c)                                  Without the prior written consent of or otherwise agreed in writing to by Company, and whether or not the Closing is consummated, each Party shall not, and shall procure that its Affiliates do not represent, directly or indirectly, that any product or services provided by it, has been approved or endorsed by the other Party or any of its Affiliates.

 

Section 5.06                             Supplemental Listing Application.  The Company shall file with the NYSE the supplemental listing application in respect of the Issued Shares as soon as reasonably practicable after the Closing (the “Supplemental Listing Application”).

 

Section 5.07                             Purchaser Transfer Restrictions.

 

(a)                                 The Purchaser shall not, and shall procure its Affiliates who hold any Issued Shares or ADSs representing any Issued Share to not, except with the prior written consent of the Company or in connection with a Permitted Transfer:

 

(i)                                     at any time on or before the 6-month anniversary of the Closing Date: Transfer any Issued Share or any ADS representing any Issued Share;

 

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(ii)                                  at any time after the 6-month anniversary of the Closing Date and on or before the 18-month anniversary of the Closing Date: Transfer any Issued Shares or any ADS representing any Issued Shares, except any Transfer that (x) is a block trade of such Securities conducted pursuant to the procedures set forth in Section 5.07(b), and (y) would not result in the Purchaser and its wholly-owned Subsidiaries collectively holding less than 50% of the Issued Shares (including, for purposes of this subsection (ii), any ADS representing the Issued Shares); and

 

(iii)                               at any time after the 18-month anniversary of the Closing Date and on or before the 36-month anniversary of the Closing Date: Transfer any Issued Share or any ADS representing any Issued Share if such Transfer would result in the Purchaser and its wholly-owned Subsidiaries collectively holding less than 50% of the Issued Shares (including, for purposes of this subsection (iii), any ADS representing the Issued Shares).

 

(b)                                 Right of First Refusal.

 

(i)                                     If the Purchaser or any of its Affiliates intends to conduct a block trade of any Securities during the time period specified in Section 5.07(a)(ii), the Purchaser shall notify the Company in writing of such intention and specify in such notice (the “ROFR Sale Proposal”) (x) the number and type of Securities proposed to be so sold (the “ROFR Securities”), (y) the period of time during which such Securities are proposed to be sold (the “ROFR Sale Window”), provided, however, that the Sale Window shall commence not less than 10 Trading Days after Company’s receipt of the Sale Proposal and shall be a period of not more than 10 consecutive Trading Days.  After the close of market on any Trading Day during the Sale Window (the “Relevant Trading Day”), but prior to the open of market on the immediately following Trading Day, the Purchaser may offer to sell to the Company all of the Offered Securities by delivering a written notice to the Company specifying the per share price at which the Purchaser is willing to sell the Offered Securities (the “ROFR Offer Notice”).

 

(ii)                                  The Company shall have an option to, by written notice (the “ROFR Exercise Notice”) to the Purchaser at any time after an Offer Notice has been given and prior to the open of market on the second Trading Day after the Relevant Trading Day (the “ROFR Election Period”), elect to purchase all or a portion of the Offered Securities at a price per share equal to that set forth in the Offer Notice.  If the Company has duly delivered the Exercise Notice within the Election Period, then payment for the Offered Securities to be purchased shall be made by the Company, against delivery of such Offered Securities, no later than the 10th Business Day after the Company’s delivery of the Exercise Notice.

 

(iii)                               If the Company does not elect to purchase all of the Offered Securities in accordance with Section 5.07(b)(ii), then, the Purchaser (or its Affiliate, as applicable) shall be entitled to sell the remaining Offered Securities via block trades at any time thereafter but prior to the open of market of the fourth Trading Day after the expiration of the Election Period, at a price per share not less than the price specified in the Offer Notice.  In the event the Purchaser (or its Affiliate, as applicable) does not sell all the Offered Securities during such period, the rights of the Company under Section 5.07(b)(i) and Section 5.07(b)(ii) shall be revived and shall be applicable to each subsequent proposed block trade of such Offered Securities during the time period specified in Section 5.07(a)(ii).

 

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(c)                                  Right of First Offer.

 

(i)                                     From and after the 18-month anniversary of the Closing Date, the Company shall have a right of first offer if the Purchaser or any of its Affiliates (the “ROFO Transferor”) proposes to Transfer (other than a Permitted Transfer) any Issued Shares or any ADSs representing the Issued Shares (collectively, the “ROFO Securities”) owned by it to any Person. Each time a ROFO Transferor proposes to Transfer any ROFO Securities, it shall first make (and the Purchaser shall procure the ROFO Transferor to make) an offer to sell the ROFO Securities to the Company in accordance with the following provisions of this Section 5.07(c).

 

(ii)                                  The ROFO Transferor shall give written notice (the “ROFO Notice”) to the Company stating the ROFO Transferor’s bona fide intention to Transfer the ROFO Securities and specifying the number of ROFO Securities.

 

(iii)                               Upon receipt of the ROFO Notice, the Parties agree to procure the ROFO Transferor and the Company to negotiate in good faith for a period of 10 Business Days (the “ROFO Notice Period”) the terms and conditions of Transfer of the ROFO Securities by the ROFO Transferor to the Company.  If the ROFO Transferor and the Company agree on the terms and conditions of the Transfer in accordance with this Section 5.07(c)(iii), then payment for the ROFO Securities to be purchased shall be made by the Company, against delivery of such ROFO Securities, no later than the 10th Business Day after such agreement.

 

(iv)                              If the Parties fails to agree on the terms and conditions of the proposed Transfer in accordance with Section 5.07(c)(iii), the ROFO Transferor may, during the 10 Business Day period following the expiration of the ROFO Notice Period, Transfer all of the ROFO Securities not purchased by the Company, provided that, during such 10 Business Day period, (x) the Company shall have the right to deliver a notice to the ROFO Transferor stating the material terms (including the price and number of ROFO Securities it intends to purchase) (the “Company’s Bid”) prior to such ROFO Securities having been transferred in accordance with this Section 5.07(c)(iv) and (y) the Purchaser shall not Transfer any ROFO Securities to any Transferee on terms and conditions less favorable to the ROFO Transferor than those set forth in the Company’s Bid unless the Purchaser agrees to Transfer to the Company the number of ROFO Securities at the price set forth in the Company’s Bid. If the ROFO Transferor does not Transfer the ROFO Securities within such period, the rights provided hereunder shall be deemed to be revived and the ROFO Securities shall not be offered to any Person unless first re-offered to the Company in accordance with this Section 5.07(c).

 

(d)                                 Notwithstanding anything herein to the contrary, the Purchaser shall not, and shall procure its Affiliates who hold any Issued Shares or ADSs representing any Issued Shares to not, Transfer any Issued Shares or any ADS representing any Issued Shares to any Company Competitor, provided, however, that this Section 5.07(d) shall not apply to any sale of Securities conducted through the automated trading system of the applicable securities exchange where the identity of the prospective purchaser is unknown and could not reasonably be known to the seller of such Securities.  For purposes hereof, “Company Competitors” means (i) Persons designated in writing by the Company to the Purchaser on or about the date hereof and as such designations may be updated by the Company (as determined by the Company in good faith) from time to time by written notice to the Purchaser, provided that the Company shall not

 

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update such designations more than twice during any calendar year, and (ii) Subsidiaries and, to the Purchaser’s knowledge, other Affiliates of any Person who is designated under subsection (i).

 

ARTICLE VI
 CONDITIONS TO THE COMPANY’S OBLIGATION

 

The obligation of the Company hereunder to issue and sell the Issued Shares to the Purchaser at the Closing is subject to the satisfaction or waiver by the Company, at or before the Onshore Payment Date, of each of the following conditions:

 

Section 6.01                             Representations and Warranties; Covenants.

 

(a)                                 Each representation and warranty made by the Purchaser in Section 3.01, Section 3.02 and Section 3.07 shall be true and correct in all respects as of the date of this Agreement and as of the Onshore Payment Date as though made at that date (except for those representations and warranties that speak as of a specific date, which shall be so true and correct as of such specified date).

 

(b)                                 Each representation and warranty made by the Purchaser in ARTICLE III (other than those enumerated in Section 6.01(a)) shall be true and correct in all respects, as of the date of this Agreement and as of the Onshore Payment Date as though made at that date (except for those representations and warranties that speak as of a specific date, which shall be so true and correct as of such specified date), except, in each case, where the failure of any such representations and warranties to be so true and correct, individually or in the aggregate, has not had and would not have a material adverse effect on the ability of the Purchaser to consummate the transactions contemplated hereunder and under the Onshore Transaction Documents.

 

(c)                                  The Purchaser shall have performed, satisfied and complied with the covenants and agreements required by this Agreement to be performed, satisfied or complied with by the Purchaser at or prior to the Onshore Payment Date, except for such non-compliance which would not, individually or in the aggregate, result in a material adverse effect on the ability of the Purchaser to consummate the transactions contemplated hereunder and under the Onshore Transaction Documents.

 

Section 6.02                             No Stop Order.  No stop order suspending the qualification or exemption from qualification of ADSs from trading on the NYSE shall have been issued and no Proceeding for that purpose shall have been commenced or shall be pending or threatened.

 

Section 6.03                             No Action.  No Law or Judgment entered by or with any Governmental Authority with competent jurisdiction, shall be in effect that enjoins, prohibits or materially alters the terms of the transactions contemplated by the Transaction Documents, nor any Proceeding challenging any Transaction Document or the transactions contemplated hereby and thereby, or seeking to prohibit, alter, prevent or delay the Closing, shall have been instituted or being pending before any Governmental Authority.

 

Section 6.04                             PRC Regulatory Filings.  The Purchaser shall have duly made all PRC Regulatory Filings and the Company shall have received copies of written evidence issued by the applicable Governmental Authorities showing that each PRC Regulatory Filing has been

 

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unconditionally confirmed or accepted, and all such confirmation or acceptance shall remain in full force and effect.

 

Section 6.05                             Onshore Investment.  All conditions precedent to the Onshore Investor’s obligation to pay the Onshore Purchase Price as set forth in Section 3.02 of the Onshore Investment Agreement shall have been satisfied or duly waived in accordance with the Onshore Investment Agreement (other than the condition set forth in Section 3.02(c) of the Onshore Investment Agreement).

 

Section 6.06                             Stand-by Letter of Credit.  The Company shall have received the SBLC, which shall be in full force and effect as of the Onshore Payment Date.

 

Section 6.07                             Officer’s Certificate.  The Purchaser shall have delivered to the Company a certificate, dated as of the Onshore Payment Date, executed by a duly authorized officer of the Purchaser, certifying to the fulfillment of the condition specified in Section 6.01.

 

ARTICLE VII
 CONDITIONS TO THE PURCHASER’S OBLIGATION

 

The obligations of the Purchaser under Section 2.03 are subject to the satisfaction or waiver by the Purchaser, at or before the Onshore Payment Date, of each of the following conditions:

 

Section 7.01                             Representations and Warranties; Covenants.

 

(a)                                 Each representation and warranty made by the Company in Section 4.01, Section 4.02, Section 4.03, Section 4.04 and Section 4.07 shall be true and correct in all respects as of the date of this Agreement and as of the Onshore Payment Date as though made at that date (except for those representations and warranties that speak as of a specific date, which shall be so true and correct as of such specified date).

 

(b)                                 Each representation and warranty made by the Company in ARTICLE IV (other than those enumerated in Section 7.01(a)) shall be true and correct in all respects, as of the date of this Agreement and as of the Onshore Payment Date as though made at that date (except for those representations and warranties that speak as of a specific date, which shall be so true and correct as of such specified date), except, in each case, where the failure of any such representations and warranties to be so true and correct, individually or in the aggregate, has not had and would not have a Material Adverse Effect.

 

(c)                                  The Company shall have performed, satisfied and complied with the covenants and agreements required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Onshore Payment Date, except for such non-compliance which would not, individually or in the aggregate, result in a material adverse effect on the ability of the Company to consummate the transactions contemplated hereunder and under the Onshore Transaction Documents.

 

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Section 7.02                             No Stop Order.  No stop order suspending the qualification or exemption from qualification of ADSs from trading on the NYSE shall have been issued and no Proceeding for that purpose shall have been commenced or shall be pending or threatened.

 

Section 7.03                             No Action.  No Law or Judgment entered by or with any Governmental Authority with competent jurisdiction, shall be in effect that enjoins, prohibits or materially alters the terms of the transactions contemplated by the Transaction Documents, nor any Proceeding challenging any Transaction Document or the Shareholders Agreement or the transactions contemplated hereby or thereby, or seeking to prohibit, alter, prevent or delay the Closing, shall have been instituted or being pending before any Governmental Authority.

 

Section 7.04                             No Material Adverse Effect.  No Material Adverse Effect shall have occurred after the date hereof and be continuing as of the Onshore Payment Date.

 

Section 7.05                             PRC Regulatory Filings.  All Enumerated PRC Regulatory Filings shall have been made with, and unconditionally confirmed or accepted by, the applicable Governmental Authorities, and all such confirmation or acceptance shall remain in full force and effect.

 

Section 7.06                             Onshore Investment.  The Onshore Investor shall have paid the Onshore Purchase Price pursuant to Section 3.01 of the Onshore Investment Agreement.

 

Section 7.07                             Company Officer’s Certificate.  The Company shall have delivered to the Purchaser a certificate, dated as of the Onshore Payment Date, executed by a duly authorized officer of the Company, certifying to the fulfillment of the conditions specified in Section 7.01 and Section 7.04.

 

ARTICLE VIII
 TERMINATION

 

Section 8.01                             Termination.  Subject to Section 8.02, this Agreement may be terminated and the transactions contemplated by this Agreement abandoned at any time prior to the Onshore Payment Date:

 

(a)                                 by the mutual written consent of the Company and the Purchaser;

 

(b)                                 by the Company or the Purchaser if any Law, or any final, non-appealable injunction or order shall have been enacted, issued, promulgated, enforced or entered which is in effect and has the effect of prohibiting the sale, issuance or purchase of the Issued Shares;

 

(c)                                  by the Purchaser if there has been a breach of any representation, warranty, covenant or agreement by the Company under this Agreement that would give rise to the failure of the condition set forth in Section 7.01, and such breach is not cured within 30 days of receipt of written notice thereof from the Purchaser;

 

(d)                                 by the Company if there has been a breach of any representation, warranty, covenant or agreement by Purchaser under this Agreement that would give rise to the

 

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failure of the condition set forth in Section 6.01, and such breach is not cured within 30 days of receipt of written notice thereof from the Company;

 

(e)                                  by the Company or the Purchaser, upon written notice to the other Party, if the Onshore Payment has not occurred as of the Long Stop Date, provided, however, that the right to terminate this Agreement under this Section 8.01(e) shall not be available to any Party whose failure to fulfill any obligation under this Agreement shall have been the principal cause of, or shall have resulted in, the failure of the Onshore Payment to occur on or prior to such date; or

 

(f)                                   by the Company or the Purchaser, upon written notice to the other Party, if the Onshore Investment Agreement has been terminated in accordance with its terms prior to the Onshore Payment Date.

 

Section 8.02                             Effect of Termination.  In the event of termination of this Agreement as provided in Section 8.01, written notice thereof shall be given to the other Party specifying the provision hereof pursuant to which such termination is made, and this Agreement shall forthwith become void and there shall be no liability or obligation on the part of the Parties; provided that (a) nothing herein shall relieve any Party from liability for any breach of this Agreement that occurred before such termination and (b) the provisions of this ARTICLE VIII, ARTICLE X, Section 5.04 and Section 5.05 shall remain in full force and effect and survive any termination of this Agreement pursuant to the terms of this ARTICLE VIII.

 

ARTICLE IX
 INDEMNIFICATION

 

Section 9.01                             Survival.  Other than the representations and warranties set forth in Section 3.01, Section 3.02, Section 4.01, Section 4.02, Section 4.03, Section 4.04 and Section 4.07, which shall survive the Closing until the expiration of the applicable statute of limitations, the representations and warranties of the parties set forth in ARTICLE III and ARTICLE IV shall survive the Closing until the first anniversary of the Closing Date.  All of the covenants or other agreements of the Parties contained in this Agreement shall survive the Closing until fully performed in accordance with their terms.

 

Section 9.02                             Indemnification.

 

(a)                                 The Company, from and after the Closing, shall defend, protect, indemnify and hold harmless the Purchaser, its Affiliates and their respective officers, directors, employees and agents from and against any and all actions, causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith, and including reasonable attorneys’ fees and disbursements (the “Indemnified Liabilities”), incurred by the Purchaser as a result of, or arising out of, or relating to (i) any misrepresentation or breach of any representation or warranty made by the Company in this Agreement, or (ii) any breach of any covenant, agreement or obligation of the Company contained in this Agreement.

 

(b)                                 The Purchaser, from and after the Closing, shall defend, protect, indemnify and hold harmless the Company, its Affiliates and their respective officers, directors, employees and agents from and against any and all Indemnified Liabilities incurred by the

 

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Company as a result of, or arising out of, or relating to (i) any misrepresentation or breach of any representation or warranty made by the Purchaser in this Agreement, or (ii) any breach of any covenant, agreement or obligation of the Purchaser contained in this Agreement.

 

Section 9.03                             Limitation to Liability.  Notwithstanding anything to the contrary in this Agreement and except in the case of fraud or deliberate breach by a Party in connection with the transactions contemplated under this Agreement:

 

(a)                                 no claim for indemnification may be asserted nor may any Proceeding be commenced against either Party for breach of any representation, warranty, covenant or agreement contained herein, unless written notice of such claim or Proceeding is received by such Party describing in reasonable detail the facts and circumstances with respect to the subject matter of such claim or proceeding on or prior to the date on which the representation, warranty, covenant or agreement on which such claim or Proceeding is based ceases to survive as set forth in Section 9.01.  In the event that a notice of claim for indemnification under this ARTICLE IX has been given within the applicable survival period, the representations and warranties that are the subject of such indemnification claim (and the right to pursue such claim) shall survive with respect to such claim until such time as such claim is finally resolved in accordance with the provisions hereof;

 

(b)                                 the Company shall not be liable to the Purchaser for any Indemnified Liabilities (i) unless and until the aggregate amount of such Indemnified Liabilities in respect of the indemnification hereunder exceeds US$46,000,000 and once such amount has been exceeded, the Company shall be liable for the aggregate amount of all Indemnified Liabilities and not merely the excess, and (ii) unless and until the amount of Indemnified Liabilities arising from any particular inaccuracy in or breach of any representation, warranty exceeds US$2,000,000, provided that, the limitation to the Company’s liabilities under this Section 9.03(b) shall not apply to any breach of any representation or warranty made by the Company under Section 4.01, Section 4.02, Section 4.03, Section 4.04 or Section 4.07;

 

(c)                                  the Company shall have no liabilities or obligations under this ARTICLE IX from and after the aggregate amount of all Indemnified Liabilities exceeds (i) with respect to all claims under ARTICLE IX (other than claims for Indemnified Liabilities arising out of any breach of any representation or warranty made by the Company under Section 4.01, Section 4.02, Section 4.03, Section 4.04 or Section 4.07), an amount equal to 25% of the Aggregate Purchase Price, and (ii) with respect to all claims under ARTICLE IX arising out of any breach of any representation or warranty made by the Company under Section 4.01, Section 4.02, Section 4.03, Section 4.04 or Section 4.07), an amount equal to 100% of the Aggregate Purchase Price;

 

(d)                                 no Party shall have any liability under any provision of this Agreement for any punitive, incidental, consequential, special or indirect damages, including loss of future revenue or income, or loss of business reputation or opportunity relating to the breach or alleged breach of this Agreement;

 

(e)                                  the Party seeking indemnification pursuant to this ARTICLE IX shall use commercially reasonable efforts to pursue all legal rights and remedies available in order to

 

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mitigate and minimize any Indemnifiable Liabilities subject to indemnification pursuant to this ARTICLE IX promptly upon becoming aware of any event or circumstance that could reasonably be expected to constitute or give rise to such Indemnifiable Liabilities; and

 

(f)                                   notwithstanding any other provision contained herein, from and after the Closing, a claim for indemnification pursuant to this ARTICLE IX shall be the sole and exclusive remedy of any Party for any claims against the other Party arising out of or resulting from this Agreement or other Transaction Documents and the transactions contemplated hereby and thereby; provided that a Party shall also be entitled to seek specific performance or other equitable remedies pursuant to Section 10.13.

 

ARTICLE X
 MISCELLANEOUS

 

Section 10.01                      Expenses.  Except as otherwise provided in this Agreement and the other Transaction Documents, each Party shall bear and pay its own costs, fees and expenses incurred by it in connection with the Transaction Documents and the transactions contemplated by the Transaction Documents.

 

Section 10.02                      Governing Law.  This Agreement shall be governed by, and construed in accordance with, the laws of Hong Kong, without regard to principles of conflict of laws thereunder.

 

Section 10.03                      Dispute Resolution.  Any dispute, controversy or claim arising out of or relating to this Agreement, including, but not limited to, any question regarding the breach, termination or invalidity thereof shall be finally resolved by arbitration in Hong Kong in accordance with the rules (the “ICC Rules”) of the International Chamber of Commerce in force at the time of commencement of the arbitration.

 

(a)                                 The arbitral tribunal shall consist of three arbitrators.  The arbitrators shall be appointed in accordance with the ICC Rules.

 

(b)                                 The language to be used in the arbitration proceedings shall be English.

 

(c)                                  Any arbitration award shall be (i) in writing and shall contain the reasons for the decision, (ii) final and binding on the parties hereto and (iii) enforceable in any court of competent jurisdiction, and the parties hereto agree to be bound thereby and to act accordingly.

 

(d)                                 In the event a dispute is referred to arbitration hereunder, the Parties shall continue to exercise their remaining respective rights and fulfill their remaining respective obligations under this Agreement.

 

(e)                                  It shall not be incompatible with this arbitration agreement for any party to seek interim or conservatory relief from courts of competent jurisdiction before the constitution of the arbitral tribunal.

 

Section 10.04                      Counterparts.  This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become

 

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effective when counterparts have been signed by each party and delivered to the other parties. A facsimile or “PDF” signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature were an original.

 

Section 10.05                      Severability.   If any provision of this Agreement is found to be invalid or unenforceable, then such provision shall be construed, to the extent feasible, so as to render the provision enforceable and to provide for the consummation of the transactions contemplated hereby on substantially the same terms as originally set forth herein, and if no feasible interpretation would save such provision, it shall be severed from the remainder of this Agreement, which shall remain in full force and effect unless the severed provision is essential to the rights or benefits intended by the parties. In such event, the parties shall use commercially reasonable efforts to negotiate, in good faith, a substitute, valid and enforceable provision or agreement, which most nearly effects the parties’ intent in entering into this Agreement.

 

Section 10.06                      Entire Agreement.  This Agreement, the other Transaction Documents and the Onshore Transaction Documents, together with all the schedules and exhibits hereto and thereto and the certificates and other written instruments delivered in connection therewith from time to time on and following the date hereof, constitute and contain the entire agreement and understanding between the Parties with respect to the subject matter hereof and thereof and supersedes any and all prior negotiations, correspondence, agreements, understandings, duties or obligations between the Parties in respect of the subject matter hereof and thereof.

 

Section 10.07                      Notices.  Except as may be otherwise provided herein, any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (a) upon receipt, when delivered personally; (b) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); (c) one (1) Business Day after deposit with an internationally recognized overnight courier service; in each case properly addressed to the party to receive the same or (d) upon dispatch, when sent by electronic mail, provided that the sender of such email shall not have, within 24 hours after such electronic mail is sent, received any automated response that such electronic mail is undeliverable to the intended recipient or the delivery is being delayed. The addresses and facsimile numbers for such communications shall be:

 

	
If to the Company:
    	
 
    
	
 
    	
 
    
	
Alibaba Group   Holding Limited
    
	
Address:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
E-mail:
    	
 
    
	
Attention:
    	
 
    
	
 
    	
 
    
	
with a copy (for   informational purposes only) to:
    
	
 
    	
 
    
	
Simpson   Thacher & Bartlett
    

 

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Address:
    	
 
    
	
 
    	
 
    
	
Email:
    	
 
    
	
Attention:
    	
 
    
	
 
    	
 
    
	
If to the Purchaser:
    	
 
    
	
 
    	
 
    
	
Suning Commerce   Group Co., Ltd.
    
	
Address:
    	
 
    
	
Email:
    	
 
    
	
Attention:
    	
 
    
	
 
    	
 
    
	
with a copy (for   informational purposes only) to:
    
	
 
    	
 
    
	
Sullivan &   Cromwell
    
	
Address:
    	
 
    
	
Email:
    	
 
    
	
Attention:
    	
 
    

 

A party may change or supplement the addresses given above, or designate additional addresses, for purposes of this Section 10.07 by giving the other parties written notice of the new address in the manner set forth above.

 

Section 10.08                      No Third Party Beneficiaries. This Agreement shall be binding upon and inure solely to the benefit of, and be enforceable by, only the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

 

Section 10.09                      Successors and Assigns.  The provisions of this Agreement shall inure to the benefit of, and shall be binding upon, the successors and permitted assigns of the parties hereto. Except as otherwise provided herein, neither this Agreement nor any of the rights, interests, or obligations hereunder shall be assigned by any party hereto (whether by operation of law or otherwise) without the prior written consent of the other parties hereto; provided, however, that the Purchaser may designate, by written notice to the Company no later than five (5) Business Days prior to the Closing, a wholly-owned Subsidiary of the Purchaser reasonably acceptable to the Company (the “Purchaser Designee”), to be registered as the owner of the Issued Shares at the Closing, provided further that the Purchaser shall remain jointly and severally liable with the Purchaser Designee under this Agreement.

 

Section 10.10                      Construction. Each Party has participated in the drafting and negotiation of this Agreement. If an ambiguity or question of intent or interpretation arises, this Agreement must be construed as if it is drafted by all the parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of authorship of any of the provisions of this Agreement.

 

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Section 10.11                      Further Assurances.  Each Party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as any other parties may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

Section 10.12                      Adjustment of Share Numbers.  If there is a subdivision, split, share dividend, combination, reclassification or similar event with respect to any of the Ordinary Shares, then the numbers and types of shares of such Ordinary Shares referred to in this Agreement shall be adjusted to the number and types of shares that a holder of such number of shares would own or be entitled to receive as a result of such event if such holder had held such number of shares immediately prior to the record date for, or effectiveness of, such event.

 

Section 10.13                      Specific Performance.  The Parties acknowledge and agree that irreparable harm may occur for which money damages would not be an adequate remedy in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that, in addition to any other remedies at law or in equity, the Parties shall be entitled to injunction and other equitable remedies, including specific performance of the terms and provisions of this Agreement, without posting any bond or other undertaking.

 

Section 10.14                      Amendment; Waiver. Except as specifically provided herein, this Agreement may be amended, modified or supplemented only by a written instrument duly executed by the Parties. Except as specifically provided herein, the observance of any provision in this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only by the written consent of the Party against whom such waiver is to be effective.  Any amendment or waiver effected in accordance with this Section 10.14 shall be binding upon the Parties and their respective assigns. It is agreed that no delay or omission to exercise any right, power or remedy accruing to any party, upon any breach, default or noncompliance by another party under this Agreement, shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence therein, or of or in any similar breach, default or noncompliance thereafter occurring.

 

Section 10.15                      Language Version. This Agreement is written and executed in English and Chinese.  In the event of any inconsistency between the two language versions, the English version shall prevail.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties hereto have caused their respective signature page to this Agreement to be duly executed as of the date first written above.

 

 

	
 
    	
ALIBABA GROUP HOLDING LIMITED
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Timothy A. Steinert
    
	
 
    	
 
    	
Name: Timothy Alexander Steinert
    
	
 
    	
 
    	
Title:     Authorized Signatory
    

 

 

	
 
    	
SUNING COMMERCE GROUP CO., LTD.
    
	
 
    	
 
    	
 
    
	
 
    	
(Company Chop)
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Ren Jun
    
	
 
    	
 
    	
Name: 
    
	
 
    	
 
    	
Title:

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