Document:

Exhibit 10.45

 

Execution Version

 

SHARE SUBSCRIPTION AGREEMENT

 

BETWEEN

 

ALIBABA GROUP HOLDING LIMITED

 

AND

 

浙江蚂蚁小微金融服务集团有限公司

(ZHEJIANG ANT SMALL AND MICRO FINANCIAL SERVICES

GROUP CO., LTD.)

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE 1
    	
DEFINITIONS
    	
2
    
	
 
    	
 
    	
 
    
	
1.1.
    	
Defined Terms
    	
2
    
	
 
    	
 
    	
 
    
	
1.2.
    	
Cross-Reference of   Other Definitions
    	
6
    
	
 
    	
 
    	
 
    
	
1.3.
    	
Certain Rules of   Construction
    	
7
    
	
 
    	
 
    	
 
    
	
ARTICLE 2
    	
BUSINESS SCOPE OF THE JOINT VENTURE
    	
8
    
	
 
    	
 
    	
 
    
	
ARTICLE 3
    	
ORGANIZATION
    	
8
    
	
 
    	
 
    	
 
    
	
3.1.
    	
Establishment of Joint   Venture Entities
    	
8
    
	
 
    	
 
    	
 
    
	
3.2.
    	
Koubei Holdco
    	
9
    
	
 
    	
 
    	
 
    
	
3.3.
    	
Koubei Shanghai Opco,   Koubei Hangzhou Opco, VIE Subsidiary and other Joint Venture Entities
    	
9
    
	
 
    	
 
    	
 
    
	
3.4.
    	
License to Use Parties’   Names and Branding
    	
10
    
	
 
    	
 
    	
 
    
	
3.5.
    	
Statements of Adhesion
    	
10
    
	
 
    	
 
    	
 
    
	
3.6.
    	
Conflicts
    	
10
    
	
 
    	
 
    	
 
    
	
ARTICLE 4
    	
SUBSCRIPTIONS AND CAPITAL   CONTRIBUTIONS
    	
10
    
	
 
    	
 
    	
 
    
	
4.1.
    	
Initial Capitalization
    	
10
    
	
 
    	
 
    	
 
    
	
4.2.
    	
Second Capitalization
    	
11
    
	
 
    	
 
    	
 
    
	
4.3.
    	
The Subscription Shares
    	
12
    
	
 
    	
 
    	
 
    
	
ARTICLE 5
    	
INITIAL CLOSING
    	
12
    
	
 
    	
 
    	
 
    
	
5.1.
    	
Initial Closing
    	
12
    
	
 
    	
 
    	
 
    
	
5.2.
    	
Conditions to the   Initial Closing
    	
13
    
	
 
    	
 
    	
 
    
	
ARTICLE 6
    	
SECOND CLOSING
    	
15
    
	
 
    	
 
    	
 
    
	
6.1.
    	
Second Closing
    	
15
    
	
 
    	
 
    	
 
    
	
6.2.
    	
Conditions to the   Second Closing
    	
15
    

 

i

 

TABLE OF CONTENTS

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE 7
    	
POST INITIAL CLOSING COVENANTS
    	
16
    
	
 
    	
 
    	
 
    
	
7.1.
    	
Fixed Assets
    	
16
    
	
 
    	
 
    	
 
    
	
7.2.
    	
Employees
    	
17
    
	
 
    	
 
    	
 
    
	
7.3.
    	
Business Contracts
    	
18
    
	
 
    	
 
    	
 
    
	
7.4.
    	
Cost Reimbursement
    	
20
    
	
 
    	
 
    	
 
    
	
7.5.
    	
Control of VIE   Subsidiary
    	
22
    
	
 
    	
 
    	
 
    
	
ARTICLE 8
    	
REPRESENTATIONS AND WARRANTIES
    	
23
    
	
 
    	
 
    	
 
    
	
8.1.
    	
Corporate Organization
    	
23
    
	
 
    	
 
    	
 
    
	
8.2.
    	
Authorization
    	
23
    
	
 
    	
 
    	
 
    
	
8.3.
    	
No Violation
    	
23
    
	
 
    	
 
    	
 
    
	
8.4.
    	
Litigation
    	
23
    
	
 
    	
 
    	
 
    
	
8.5.
    	
Fixed Assets
    	
24
    
	
 
    	
 
    	
 
    
	
8.6.
    	
Certain Contracts
    	
24
    
	
 
    	
 
    	
 
    
	
8.7.
    	
Exclusivity of   Representations
    	
24
    
	
 
    	
 
    	
 
    
	
ARTICLE 9
    	
COVENANTS
    	
24
    
	
 
    	
 
    	
 
    
	
9.1.
    	
Confidentiality
    	
24
    
	
 
    	
 
    	
 
    
	
9.2.
    	
Appropriate Action;   Consents; Filings
    	
25
    
	
 
    	
 
    	
 
    
	
9.3.
    	
Public Announcement and   Filings
    	
25
    
	
 
    	
 
    	
 
    
	
ARTICLE 10
    	
TERMINATION
    	
26
    
	
 
    	
 
    	
 
    
	
10.1.
    	
Termination
    	
26
    
	
 
    	
 
    	
 
    
	
10.2.
    	
Effect of Termination
    	
26
    
	
 
    	
 
    	
 
    
	
ARTICLE 11
    	
GENERAL PROVISIONS
    	
27
    

 

ii

 

TABLE OF CONTENTS

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
11.1.
    	
Notices
    	
27
    
	
 
    	
 
    	
 
    
	
11.2.
    	
Waiver
    	
28
    
	
 
    	
 
    	
 
    
	
11.3.
    	
Severability
    	
28
    
	
 
    	
 
    	
 
    
	
11.4.
    	
Governing Law
    	
28
    
	
 
    	
 
    	
 
    
	
11.5.
    	
Arbitration
    	
29
    
	
 
    	
 
    	
 
    
	
11.6.
    	
Counterparts
    	
30
    
	
 
    	
 
    	
 
    
	
11.7.
    	
No Consequential   Damages
    	
30
    
	
 
    	
 
    	
 
    
	
11.8.
    	
Successors and Assigns
    	
30
    
	
 
    	
 
    	
 
    
	
11.9.
    	
Limitation on Rights of   Others
    	
30
    
	
 
    	
 
    	
 
    
	
11.10.
    	
Entire Agreement; Amendment
    	
30
    
	
 
    	
 
    	
 
    
	
11.11.
    	
Expenses
    	
30
    
	
 
    	
 
    	
 
    
	
11.12.
    	
Construction
    	
30
    
	
 
    	
 
    	
 
    
	
11.13.
    	
Disclaimer of Agency
    	
31
    

 

iii

 

SHARE SUBSCRIPTION AGREEMENT

 

THIS SHARE SUBSCRIPTION AGREEMENT (this “Agreement”) is made as of September 7, 2015 by and between Alibaba Group Holding Limited, a company organized under the laws of the Cayman Islands (“AGH”), and 浙江蚂蚁小微金融服务集团有限公司 (Zhejiang Ant Small and Micro Financial Services Group Co., Ltd.), a company organized under the laws of the PRC (“ANT”).  The parties hereto are referred to collectively as the “Parties” and each as a “Party”.

 

RECITALS:

 

1.                                      AGH and ANT have been considering forming a joint venture (the “Joint Venture”) to engage in the business of providing certain O2O Services and Payment-related Merchant Operations Services.

 

2.                                      AGH and ANT wish to structure the Joint Venture by utilizing Koubei Holding Limited, a company organized under the laws of the Cayman Islands (the “Koubei Holdco”) which is 100% Beneficially Owned by AGH as of the date hereof, as the holding company of the Joint Venture, with the Koubei Holdco, in turn, being the sole Beneficial Owner of the key operating entities of the Joint Venture, including (a) 口碑(上海)信息技术有限公司 (Koubei (Shanghai) Information Technology Co., Ltd.), a wholly foreign-owned enterprise organized under the laws of the PRC in Shanghai, PRC (the “Koubei Shanghai Opco”), (b) 浙江口碑网络技术有限公司 (Zhe Jiang Koubei Technology Co., Ltd.), a wholly foreign-owned enterprise organized under the laws of the PRC (the “Koubei Hangzhou Opco”) and (c) 杭州口口相传网络技术有限公司 (Hangzhou Kou Kou Xiang Chuan Network Technology Co., Ltd.), a company organized under the laws of the PRC subject to a VIE Structure (the “VIE Subsidiary”).  A structure chart reflecting the ownership structure of the Joint Venture immediately after the Initial Closing is set out in Exhibit A.

 

3.                                      Each of AGH and ANT wishes to procure the contribution of certain cash and/or certain assets to the Joint Venture in exchange for the issuance of certain number of ordinary shares of the Koubei Holdco (“Shares”).  Immediately following the Initial Closing, AGH and ANT will each become a Beneficial Owner of fifty percent (50%) of all issued and outstanding shares in the capital of the Koubei Holdco.

 

4.                                      Having determined to proceed with the Joint Venture, the Parties wish to enter into (and/or cause their respective Affiliates to enter into) a series of transactions, on the terms and conditions set forth in this Agreement, to form such Joint Venture and effectuate the contribution of cash thereto and the transactions contemplated hereby.

 

NOW, THEREFORE, in consideration of the mutual premises and the covenants contained herein, the Parties hereby agree as follows:

 

1

 

ARTICLE 1

 

DEFINITIONS

 

1.1.                            DEFINED TERMS

 

The following terms shall have the following meanings for the purposes of this Agreement:

 

“Affiliate” means, with respect to any specified Person, any other Person who, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such specified Person; provided that, for the purposes of this definition, “control” (including with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by Contract or otherwise.  For the avoidance of doubt, (a) the Affiliates of a Person shall include the Subsidiaries of such Person, and (b) AGH shall not be an Affiliate of SoftBank or of Yahoo!, or vice versa, for purposes of this Agreement.

 

“AGH Co” means Ali KB Investment Holding Limited, a company organized under the laws of the Cayman Islands.

 

“AGH Fair Market Value” has the meaning set forth in Section 7.4(a).

 

“AGH Exclusive O2O Services” means O2O Services involving movie ticketing and travel services.

 

“AGH Newly Recruited JV Employee” means any employee newly recruited by AGH or any of its Subsidiaries during the period commencing from May 1, 2015 and ending on the date immediately prior to the date of the Initial Closing who has subsequently commenced employment with the Joint Venture pursuant to Section 7.2(b).

 

“Ancillary Agreements” means each of the agreements listed in Exhibit B, as well as all documents to be executed as contemplated by or pursuant to the provisions of such agreements or this Agreement.

 

“ANT Co” means ANT KBW Investment Limited, a company organized under the laws of the British Virgin Islands.

 

“ANT Fair Market Value” has the meaning set forth in Section 7.4(a).

 

“ANT Newly Recruited JV Employee” means any employee newly recruited by ANT or any of its Subsidiaries during the period commencing from May 1, 2015 and ending on the date immediately prior to the date of the Initial Closing who has subsequently commenced employment with the Joint Venture pursuant to Section 7.2(c).

 

“Beneficial Owner” of any security means any Person who, directly or indirectly, through any Contract, arrangement, understanding, relationship or otherwise has or shares (i) voting

 

2

 

power, which includes the power to vote, or to direct the voting of, such security; and/or (ii) investment power which includes the power to dispose, or to direct the disposition of, such security.  “Beneficially Own” and “Beneficial Ownership” shall have correlative meanings.

 

“Board of Directors” means the board of directors of the Koubei Holdco from time to time.

 

“Business Day” means each day that is not a Saturday, Sunday or other day on which banking institutions located in Shanghai or Hong Kong are authorized or obligated by applicable Laws to close.

 

“Confidential Information” means information delivered by or on behalf of a Party to another Party or its Representatives pursuant to, in connection with, or related to this Agreement or any of the transactions, rights or obligations contemplated by this Agreement; provided, that such term does not include information that (a) was publicly known prior to the time of such disclosure; (b) was otherwise known to such receiving Party and not subject to a duty to keep such information confidential prior to the time of such disclosure; (c) subsequently becomes publicly known through no act or omission by such receiving Party or any of its Representatives in breach of this Agreement; (d) otherwise becomes known to such receiving Party other than through disclosure by the delivering Party or any Person that such receiving Party knows to have a duty to keep such information confidential; or (e) is subject to the data sharing agreement dated August 12, 2014 between AGH and ANT.

 

“Contract” means any service agreement, cooperation agreement, loan or credit agreement, bond, debenture, note, mortgage, indenture, lease, supply agreement, license agreement, development agreement or other contract, agreement, obligation, commitment or instrument, including all amendments thereto.

 

“Data Platform Participation Agreement” means data platform participation agreement to be entered into by and between AGH and Koubei Holdco in substantially the form attached hereto as Exhibit B.7.

 

“Encumbrance” means any charge, claim, mortgage, lien, option, pledge, title defect, security interest or other restriction or limitation of any kind.

 

“Exchange Rate” means the applicable middle exchange rate published by the People’s Bank of China on its official website on the date of the relevant payment.

 

“Fiscal Year 2016” means for financial accounting purposes, April 1, 2015 (inclusive) to March 31, 2016 (inclusive).

 

“Governmental Approval” means any consent, approval, authorization, waiver, permit, grant, franchise, concession, agreement, license, certificate, exemption, Order, registration, declaration, filing, report or notice of any Governmental Authority.

 

“Governmental Authority” means any instrumentality, subdivision, court, administrative agency, commission, official or other authority of any country, state, province, prefect, municipality, locality or other government or political subdivision thereof, or any stock or

 

3

 

securities exchange, or any multi-national, quasi-governmental or self-regulatory or private body exercising any regulatory, taxing, importing or other governmental or quasi-governmental authority.

 

“Hong Kong” means the Hong Kong Special Administrative Region of the People’s Republic of China.

 

“Initial Capital Contributions” means the contributions and payments made in accordance with Section 4.1.1(b) (in the case of AGH) and Section 4.1.2(b) (in the case of ANT).

 

“Initial Closing” means the closing of each of the transactions set forth in Section 5.1.

 

“Joint Venture Entities” means the Koubei Holdco and its Subsidiaries from time to time (it being acknowledged that the Subsidiaries of the Koubei Holdco as of or around the Initial Closing are Koubei BVI, Koubei Hong Kong, the Koubei Shanghai Opco, the Koubei Hangzhou Opco and the VIE Subsidiary), and a “Joint Venture Entity” means any of them.

 

“Joint Venture Newly Recruited Employee” means any employee newly recruited by the Joint Venture during the period commencing from the date of the Initial Closing and ending on March 31, 2016.

 

“Law” means (a) any federal, state, territorial, foreign or local law, common law, statute, ordinance, rule, regulation, code, measure, notice, circular, opinion or Order of any Governmental Authority, including any rules promulgated by a stock exchange or regulatory body or (b) any applicable widely adopted industry standard rules and regulations (such as the Payment Card Industry Data Security Standard or PCIDSS).

 

“Macau” means the Macau Special Administrative Region of the People’s Republic of China.

 

“O2O Services” means the provision of services through online platforms or mobile devices (including without limitation e-coupons, online booking and online store locators) to enable users of such platforms or devices to identify, select or order through such platforms or devices services for purchase, delivery, consumption and/or utilization in person at offline establishments where such services are normally purchased and sold, delivered, consumed or utilized and provided.

 

“Order” means any judgment, order, writ, preliminary or permanent injunction, instruction or decree of any Governmental Authority or any arbitration award.

 

“Payment-related Merchant Operations Services” means any payment-related merchant operations services (including without limitation merchant acquisition, system operation and maintenance, e-coupons, discount offers and other marketing and promotion efforts) provided to offline establishments such as convenience stores, supermarkets, department stores, franchise stores and vending machines.

 

4

 

“Person” means an individual, a partnership, a corporation, an association, a limited liability company, a joint stock company, a trust, a joint venture, an unincorporated organization, a group, a Governmental Authority or any other type of legal entity.

 

“PRC” means the People’s Republic of China (for the purpose of this Agreement, not including Hong Kong, Macau and Taiwan).

 

“Proceeding” means any action, suit, claim, hearing, proceeding, arbitration, mediation, audit, inquiry or investigation (whether civil, criminal, administrative or otherwise) by any Person or Governmental Authority.

 

“Renminbi” or “RMB” means lawful money of the PRC.

 

“Representatives” means a Person’s Affiliates, directors, managers, officers, employees, agents, attorneys, consultants, advisors or other representatives.

 

“Second Capital Contributions” means the contributions and payments made in accordance with Section 4.2.1(b) (in the case of AGH) and Section 4.2.2(b) (in the case of ANT).

 

“Second Closing” means the closing of each of the transactions set forth in Section 6.1.

 

“Social Security Benefits” means any schedule or arrangement that provides for the payment of any social insurance, pension insurance benefits, medical insurance benefits, work-related injury insurance benefits, maternity insurance benefits, unemployment insurance benefits and public housing reserve fund benefits or similar benefits, in each case as required by any applicable Law.

 

“SoftBank” means SoftBank Group Corp., a Japanese corporation and shareholder of AGH.

 

“Subsidiary” means, with respect to any Person, each other Person in which the first Person (a) Beneficially Owns, directly or indirectly, share capital or other equity interests representing more than fifty percent (50%) of the outstanding voting stock or other equity interests; (b) holds the rights to more than fifty percent (50%) of the economic interest of such other Person, including interests held through a VIE Structure or other contractual arrangements; or (c) has a relationship such that the financial statements of the other Person may be consolidated into the financial statements of the first Person under applicable accounting conventions.  For the avoidance of doubt, none of ANT or its Subsidiaries shall be deemed to be Subsidiaries of AGH or any of its Subsidiaries.

 

“U.S. Dollars” and “US$” shall each mean lawful money of the United States of America.

 

“VIE Structure” means the investment structure in which a PRC-domiciled operating entity and its PRC shareholders enter into a number of Contracts with a non-PRC investor (or a foreign-invested enterprise incorporated in the PRC invested by the non-PRC investor) pursuant to which the non-PRC investor achieves control of the PRC-domiciled operating entity and also consolidates the financials of the PRC-domiciled entity with those of the non-PRC investor.

 

5

 

“Yahoo!” means Yahoo! Inc., a Delaware corporation and a direct and indirect shareholder of AGH.

 

1.2.                            CROSS-REFERENCE OF OTHER DEFINITIONS

 

Each capitalized term listed below is defined in the corresponding Section or other part of this Agreement:

 

	
Term
    	
 
    	
Section
    
	
 
    	
 
    	
 
    
	
“AGH”
    	
 
    	
Preamble
    
	
“AGH Contracts”
    	
 
    	
7.3(a)
    
	
“AGH Employees”
    	
 
    	
7.2(a)
    
	
“AGH Fixed Assets”
    	
 
    	
7.1(a)
    
	
“AGH Reimbursable Employee Expenses”
    	
 
    	
7.4(a)
    
	
“Agreement”
    	
 
    	
Preamble
    
	
“ANT”
    	
 
    	
Preamble
    
	
“ANT Contracts”
    	
 
    	
7.3(a)
    
	
“ANT Employees”
    	
 
    	
7.2(a)
    
	
“ANT Fixed Assets”
    	
 
    	
7.1(a)
    
	
“ANT Reimbursable Employee Expenses”
    	
 
    	
7.4(a)
    
	
“ANT Remaining Contracts”
    	
 
    	
7.3(c)(iii)
    
	
“Assigned Obligations”
    	
 
    	
7.3(a)
    
	
“Commercial Agreement”
    	
 
    	
Exhibit B.8
    
	
“Contract Rights”
    	
 
    	
7.3(a)
    
	
“Cooperation Agreement”
    	
 
    	
Exhibit B.6
    
	
“Data Platform Participation Agreement”
    	
 
    	
Exhibit B.7
    
	
“Fixed Assets”
    	
 
    	
7.1(a)
    
	
“HKIAC”
    	
 
    	
11.5(a)
    
	
“Initial Closing Conditions”
    	
 
    	
5.2
    
	
“IP Transfer and License Agreement”
    	
 
    	
Exhibit B.4
    
	
“Joint Venture”
    	
 
    	
Recitals
    
	
“Koubei BVI”
    	
 
    	
Exhibit A
    
	
“Koubei Hangzhou Opco”
    	
 
    	
Recitals
    
	
“Koubei Holdco”
    	
 
    	
Recitals
    
	
“Koubei Holdco Articles”
    	
 
    	
Exhibit B.2
    
	
“Koubei Hong Kong”
    	
 
    	
Exhibit A
    
	
“Koubei Shanghai Opco”
    	
 
    	
Recitals
    
	
“Long Stop Date”
    	
 
    	
5.2
    
	
“Obligation”
    	
 
    	
7.3(a)
    
	
“Ownership Ratio”
    	
 
    	
3.2(b)
    
	
“Party” or “Parties”
    	
 
    	
Preamble
    
	
“Permitted Company Business”
    	
 
    	
Article 2
    
	
“POS”
    	
 
    	
Exhibit 7.3(b)
    
	
“Second Closing Conditions”
    	
 
    	
6.2
    

 

6

 

	
“Shared Services Agreement”
    	
 
    	
Exhibit B.5
    
	
“Shareholders Agreement”
    	
 
    	
Exhibit B.1
    
	
“Shares”
    	
 
    	
Recitals
    
	
“Statement of Adhesion”
    	
 
    	
Exhibit B.3
    
	
“VIE Subsidiary”
    	
 
    	
Recitals
    

 

1.3.                            CERTAIN RULES OF CONSTRUCTION

 

(a)           In this Agreement, unless the context otherwise requires:

 

(i)                                     references in this Agreement to “writing” or comparable expressions includes a reference to facsimile transmission or comparable means of communication (but excluding email communications in the case of agreements, amendments, consents, waivers or other documents required to be in written form signed by one or more parties or requested by a party to be communicated in writing other than by email(s));

 

(ii)                                  words expressed in the singular number shall include the plural and vice versa, and words expressed in the masculine shall include the feminine and neutral genders and vice versa;

 

(iii)                               references to Articles, Sections, Exhibits, Schedules and Recitals are references to articles, sections, exhibits, schedules and recitals of this Agreement;

 

(iv)                              references to this Agreement or any other agreement or document shall be construed as references to this Agreement or such other agreement or document, as the case may be, as the same may have been, or may from time to time be, amended, varied, novated or supplemented from time to time;

 

(v)                                 a reference to a subsection without further reference to a Section is a reference to such subsection as contained in the same Section in which the reference appears, and this rule shall also apply to paragraphs and other subdivisions;

 

(vi)                              the table of contents to this Agreement and all section titles or captions contained in this Agreement or in any Schedule or Exhibit annexed hereto or referred to herein are for convenience only and shall not be deemed a part of this Agreement and shall not affect the meaning or interpretation of this Agreement;

 

(vii)                           “include,” “includes” and “including” are deemed to be followed by “without limitation” whether or not they are in fact followed by such words or words of similar import;

 

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

 

7

 

(ix)                              references to a Person are also to its permitted successors and assigns and, in the case of an individual, to his or her heirs and estate, as applicable;

 

(x)                                 any reference to a “day” (including within the phrase “Business Day”) shall mean a period of 24 hours running from midnight to midnight;

 

(xi)                              any reference to times is to local times in Hong Kong unless otherwise stated; and

 

(xii)                           any reference in relation to any particular jurisdiction to any specific legal term for any action, remedy, method of judicial Proceeding, legal document, legal status, court, official or any legal concept or thing shall in respect of any other jurisdiction be treated as a reference to any analogous term in that jurisdiction.

 

(b)           The Schedules and Exhibits to this Agreement are incorporated into and form an integral part of this Agreement.  If an Exhibit is a form of agreement, such agreement, when executed and delivered by the parties thereto, shall constitute a document independent of this Agreement.

 

ARTICLE 2

 

BUSINESS SCOPE OF THE JOINT VENTURE

 

The scope of principal business of the Joint Venture shall be:

 

(a)           O2O Services, other than the AGH Exclusive O2O Services; and

 

(b)           Payment-related Merchant Operations Services

 

((a) and (b) collectively, the “Permitted Company Business”).

 

Any change in the scope of the Permitted Company Business shall be subject to the approval requirements set forth in the Shareholders Agreement.

 

ARTICLE 3

 

ORGANIZATION

 

3.1.                            ESTABLISHMENT OF JOINT VENTURE ENTITIES

 

The Permitted Company Business shall be carried out by the Koubei Shanghai Opco, the Koubei Hangzhou Opco, the VIE Subsidiary and/or such other Joint Venture Entities as determined by the Board of Directors from time to time.

 

8

 

3.2.                            KOUBEI HOLDCO

 

(a)           The activities of the Koubei Holdco shall include those associated with establishing, owning and managing all or some of the Joint Venture Entities and such other activities as determined by the Board of Directors from time to time, consistent with the scope of the Permitted Company Business.

 

(b)           As of the date of this Agreement, AGH Beneficially Owns 100% of the equity of the Koubei Holdco. The Parties agree that, subject to satisfaction or waiver of the Initial Closing Conditions, at the Initial Closing, AGH shall Beneficially Own 50% of the equity of the Koubei Holdco and ANT shall Beneficially Own the remaining 50% (the “Ownership Ratio”), in accordance with the particulars set out in Exhibit 3.2.

 

(c)           AGH shall hold its ownership interests in the Koubei Holdco indirectly through its wholly-owned Subsidiary(ies).  ANT hereby represents and warrants to AGH that the names, place of incorporation and ownership structure of each of the intermediary companies between ANT and the ANT Co set forth in the structure chart in Exhibit A are true and accurate.

 

(d)           Each of the AGH Co and the ANT Co shall be bound by and subject to all of the obligations created by this Agreement in respect of the Party which Beneficially Owns AGH Co and the ANT Co (as the case may be).  The holding of legal title to the Koubei Holdco by the AGH Co and the ANT Co shall not relieve the Parties of their respective obligations under this Agreement, and each Party shall continue to be liable for all obligations created pursuant hereto.

 

3.3.                            KOUBEI SHANGHAI OPCO, KOUBEI HANGZHOU OPCO, VIE SUBSIDIARY AND OTHER JOINT VENTURE ENTITIES

 

(a)           The Parties shall take such steps as are necessary to ensure that, on or before the Initial Closing, the particulars of the Koubei Shanghai Opco are consistent with those set out in Exhibit 3.3(a).  Any costs in connection with the establishment of the Koubei Shanghai Opco shall be borne by the Koubei Holdco.

 

(b)           The Parties shall take such steps as are necessary to ensure that, within thirty (30) days after the Initial Closing, the particulars of the Koubei Hangzhou Opco and VIE Subsidiary are consistent with those set out in Exhibit 3.3(b) and Exhibit 3.3(c) (as the case may be).

 

(c)           On or before the Initial Closing, the Parties shall, except as contemplated or permitted in paragraph (b) above, take such steps as are necessary to ensure that, immediately after the Initial Closing, each Joint Venture Entity has an ownership structure that is consistent with the structure chart set out in Exhibit A.

 

(d)           The Parties shall cause the Koubei Shanghai Opco, the Koubei Hangzhou Opco, the VIE Subsidiary and each other Joint Venture Entity to make all registrations, filings and recordings, obtain all permits, licenses and approvals and take such other preparatory actions consistent with the terms of this Agreement and the Ancillary Agreements as may be appropriate or necessary for the formation and operation of the Joint Venture.

 

9

 

3.4.                            LICENSE TO USE PARTIES’ NAMES AND BRANDING

 

The Joint Venture may operate under the “口碑 (Koubei)” brand and/or such other brand(s) as the Board of Directors may determine from time to time.

 

3.5.                            STATEMENTS OF ADHESION

 

Promptly following the date hereof (or in the event that the relevant Person is not established on the date hereof, promptly following the establishment of such Person), the Parties shall cause each of the AGH Co, the ANT Co, the Koubei Holdco, the Koubei Shanghai Opco, the Koubei Hangzhou Opco, the VIE Subsidiary and any other Joint Venture Entity to adhere to this Agreement by executing a Statement of Adhesion.  Upon the execution of such Statement of Adhesion, such relevant Person shall be bound by and subject to (a) any provisions herein which are intended to place an obligation on either or both Parties to cause such Person to do or not do certain acts and things, (b) the provisions in Article 1 (Definitions), Article 2 (Business Scope of the Joint Venture), Article 9 (Covenants) and Article 11 (General Provisions) as if such relevant Person is a Party to this Agreement, and (c) (only in the event that such relevant Person is a Joint Venture Entity) any provisions in the Shareholders Agreement which are intended to place an obligation on a Joint Venture Entity.

 

3.6.                            CONFLICTS

 

In the event of a conflict between the provisions of this Agreement and the terms of the organizational documents of the Koubei Holdco, the Koubei Shanghai Opco, the Koubei Hangzhou Opco, the VIE Subsidiary or any other Joint Venture Entity, (i) the provisions of this Agreement shall prevail to the fullest extent permitted under applicable Laws and (ii) the Parties shall, to the fullest extent permitted under applicable Laws, promptly do or procure that there shall be done all such acts and things and execute or procure the execution of all such documents and instruments in order to give full effect to this Agreement and to secure each of the Parties the full benefits of the rights, powers and remedies conferred upon such Party in this Agreement.

 

ARTICLE 4

 

SUBSCRIPTIONS AND CAPITAL CONTRIBUTIONS

 

4.1.                            INITIAL CAPITALIZATION

 

4.1.1.                  By AGH

 

At the Initial Closing:

 

(a)           AGH shall cause the AGH Co to subscribe for and accept from the Koubei Holdco, and the Parties shall cause the Koubei Holdco to issue and deliver to the AGH Co, 122,040,865 Shares (which shall, together with all the Shares Beneficially Owned by AGH immediately prior to the Initial Closing, constitute 50% of all issued and outstanding shares in the capital of the Koubei Holdco immediately after the Initial Closing); and

 

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(b)           in consideration for the issuance of Shares set forth in paragraph (a) above, AGH Co shall pay (or cause to be paid) to the Koubei Holdco Renminbi one billion two hundred five million seven hundred sixty-three thousand seven hundred and forty-six yuan (RMB1,205,763,746) (which shall, together with the net asset value of the Koubei Holdco and its Subsidiaries as shown in the pro forma consolidated balance sheet of the Koubei Holdco as of July 31, 2015, constitute AGH’s contribution to the Joint Venture upon the Initial Closing) in immediately available funds by electronic transfer.

 

4.1.2.                  By ANT

 

At the Initial Closing:

 

(a)           ANT shall cause the ANT Co to subscribe for and accept from the Koubei Holdco, and the Parties shall cause the Koubei Holdco to issue and deliver to the ANT Co, 151,805,563 Shares (which shall constitute 50% of all issued and outstanding shares in the capital of the Koubei Holdco immediately after the Initial Closing); and

 

(b)           in consideration for the issuance of Shares set forth in paragraph (a) above, ANT shall pay (or cause to be paid) to the Koubei Holdco Renminbi one billion four hundred ninety-nine million eight hundred thirty-eight thousand nine hundred and sixty-two yuan (RMB1,499,838,962) in immediately available funds by electronic transfer.

 

4.2.                            SECOND CAPITALIZATION

 

4.2.1.                  By AGH

 

At the Second Closing:

 

(a)           AGH shall cause the AGH Co to subscribe for and accept from the Koubei Holdco, and the Parties shall cause the Koubei Holdco to issue and deliver to the AGH Co, 151,821,862 Shares (which shall, together with all the Shares Beneficially Owned by AGH immediately prior to the Second Closing, constitute 50% of all issued and outstanding shares in the capital of the Koubei Holdco immediately after the Second Closing); and

 

(b)           in consideration for the issuance of Shares set forth in paragraph (a) above, AGH Co shall pay (or cause to be paid) to the Koubei Holdco Renminbi one billion four hundred ninety-nine million nine hundred and ninety-nine thousand and nine hundred and ninety-seven yuan (RMB1,499,999,997) in immediately available funds by electronic transfer.

 

4.2.2.                  By ANT

 

At the Second Closing:

 

(a)           ANT shall cause the ANT Co to subscribe for and accept from the Koubei Holdco, and the Parties shall cause the Koubei Holdco to issue and deliver to the ANT Co, 151,821,862 Shares (which shall, together with all the Shares Beneficially Owned by ANT immediately prior to the Second Closing, constitute 50% of all issued and outstanding shares in the capital of the Koubei Holdco immediately after the Second Closing); and

 

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(b)           in consideration for the issuance of Shares set forth in paragraph (a) above, ANT shall pay (or cause to be paid) to the Koubei Holdco Renminbi one billion four hundred ninety-nine million nine hundred and ninety-nine thousand and nine hundred and ninety-seven yuan (RMB1,499,999,997) in immediately available funds by electronic transfer.

 

4.3.                            THE SUBSCRIPTION SHARES

 

All Shares issued pursuant to this Agreement are to be credited as fully-paid and free from any Encumbrances.

 

ARTICLE 5

 

INITIAL CLOSING

 

5.1.                            INITIAL CLOSING

 

(a)           Time and Place.  The Initial Closing shall take place at 11:00 a.m. on the third Business Day following the fulfillment or waiver of all of the Initial Closing Conditions (other than those Initial Closing Conditions that by their terms are intended to or may be fulfilled at the Initial Closing), or such other date and time agreed by the Parties, at the offices of Fangda Partners, 30th Floor, One Exchange Square, 8 Connaught Place, Central in Hong Kong or any other place agreed in writing by the Parties.

 

(b)           Initial Closing Deliveries.  At the Initial Closing, each Party shall deliver (or cause to be delivered) to the other Party:

 

(i)                                     evidence of the fulfillment of all the Initial Closing Conditions for which it is responsible (other than those that have been waived by the other Party);

 

(ii)                                  a share transfer form in favor of AGH Co in respect of the Shares duly executed by the AGH together with the original share certificate in the name of the AGH in respect thereof;

 

(iii)                               share certificates in the name of AGH Co and ANT Co representing the number of Shares acquired by AGH Co and ANT Co in respect of the Initial Capital Contributions pursuant to Section 4.1 respectively, and a certified true copy of the register of members of the Koubei Holdco reflecting AGH Co’s and ANT Co’s ownership of such Shares;

 

(iv)                              a certified true copy of the register of directors of the Koubei Holdco reflecting the appointment of the two directors designated by AGH and ANT respectively;

 

(v)                                 five (5) counterparts of the Shareholders Agreement duly executed by Koubei Holdco, AGH, AGH Co, ANT and ANT Co;

 

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(vi)                              seven (7) counterparts of Statements of Adhesion duly executed by AGH Co, ANT Co, the Koubei Holdco, Koubei Hong Kong, Koubei BVI, the Koubei Hangzhou Opco and the VIE Subsidiary respectively;

 

(vii)                           three (3) counterparts of IP Transfer and License Agreement duly executed by AGH, ANT and the Koubei Holdco;

 

(viii)                        three (3) counterparts of Shared Services Agreement duly executed by AGH, ANT and the Koubei Holdco;

 

(ix)                              three (3) counterparts of Cooperation Agreement duly executed by AGH, ANT and the Koubei Holdco;

 

(x)                                 three (3) counterparts of Commercial Agreement duly executed by ANT, the Koubei Holdco and Alipay.com Co., Ltd.;

 

(xi)                              a copy of the directors or shareholders resolutions of such Party authorizing (A) the execution of this Agreement and the Ancillary Agreements to which such Party is a party and (B) the transactions contemplated thereby; and

 

(xii)                           with respect to the Ancillary Agreements to which any Affiliate of such Party is a party, a copy of the directors or shareholders resolutions of such Party’s Affiliate authorizing (A) the execution of the Ancillary Agreements to which such Party’s Affiliate is a party and (B) the transactions contemplated thereby.

 

(c)           Single Transaction.  Notwithstanding anything contrary in this Agreement, all actions to be performed at the Initial Closing shall be deemed a single transaction so that, at the option of the Party for whose benefit an action is to be performed, the Initial Closing shall not be deemed to have taken place unless and until all such actions have been performed.

 

5.2.                            CONDITIONS TO THE INITIAL CLOSING

 

The Initial Closing is conditional on the satisfaction or waiver of the following conditions (the “Initial Closing Conditions”):

 

(a)           ANT shall have obtained all Governmental Approvals that are necessary under PRC Laws for ANT, a PRC entity, to make overseas direct investment and consummate the transactions contemplated by this Agreement and the Ancillary Agreements, including the payment of its proportion of the Initial Capital Contributions (but, for the avoidance of doubt, excluding the payment of its proportion of the Second Capital Contributions).  Such Governmental Approvals shall include, without limitation, the outbound investment filing with the Management Committee of the China (Shanghai) Free Trade Zone and the foreign exchange registration with the relevant bank.

 

(b)           All other Governmental Approvals and all third party consents that are necessary for the consummation of the transactions contemplated by this Agreement and the Ancillary Agreements (other than the Data Platform Participation Agreement) having been obtained.

 

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(c)           All obligations of the Parties relating to the Koubei Holdco in Section 3.2 having been performed or complied with, and shareholders resolutions and directors resolutions of the Koubei Holdco adopting the Koubei Holdco Articles and approving the matters to be set out in Section 3.2 having been passed.

 

(d)           All obligations of the Parties relating to the Koubei Shanghai Opco in Section 3.3 having been performed or complied with.

 

(e)           No Person having been threatened or commenced any Proceedings (with reasonable legal grounds) to prohibit or otherwise challenge the transactions contemplated by this Agreement and the Ancillary Agreements (other than the Data Platform Participation Agreement).

 

(f)            No Laws having been passed that would prohibit or materially restrict the implementation of this Agreement and the Ancillary Agreements (other than the Data Platform Participation Agreement) or either Party’s participation in the Joint Venture.

 

(g)           Since the date of this Agreement, there not having occurred any material adverse change in the business, operations, assets, position (financial, trading or otherwise), profits or prospects of AGH or any event or circumstance that may result in such material adverse change.

 

(h)           Since the date of this Agreement, there not having occurred any material adverse change in the business, operations, assets, position (financial, trading or otherwise), profits or prospects of ANT or any event or circumstance that may result in such material adverse change.

 

(i)            Before the Initial Closing, each Ancillary Agreement (other than the Data Platform Participation Agreement) having been duly executed by all parties to it.

 

(j)            Each Ancillary Agreement (other than the Data Platform Participation Agreement) becoming unconditional (save in relation to any condition making completion of that agreement conditional upon completion of this Agreement) and not being terminated in accordance with its terms.

 

(k)           AGH’s obligations in respect of the Initial Closing shall be conditional on ANT’s portion of the Initial Capital Contributions having been made, and such condition shall only be waivable by AGH.

 

(l)            ANT’s obligations in respect of the Initial Closing shall be conditional on AGH’s portion of the Initial Capital Contributions having been made, and such condition shall only be waivable by ANT.

 

Each of the Parties shall use its best endeavors to fulfill or procure the fulfillment of all the Initial Closing Conditions for which it (or its Affiliates) is responsible as soon as practicable and in any event on or before September 30, 2015 (as may be extended by the Parties in writing, the “Long Stop Date”).

 

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ARTICLE 6

 

SECOND CLOSING

 

6.1.                            SECOND CLOSING

 

(a)                                 Time and Place.  The Second Closing shall take place on a date to be agreed in writing by the Parties, at the offices of Fangda Partners, 30th Floor, One Exchange Square, 8 Connaught Place, Central in Hong Kong or any other place agreed in writing by the Parties.

 

(b)                                 Second Closing Deliveries.  At the Second Closing, each Party shall deliver (or cause to be delivered) to the other Party:

 

(i)                                     evidence of the fulfillment of all the Second Closing Conditions for which it is responsible (other than those that have been waived by the other Party);

 

(ii)                                  share certificates in the name of AGH Co and ANT Co representing the additional number of Shares acquired by AGH Co and ANT Co in respect of the Second Capital Contributions pursuant to Section 4.2 respectively, and a certified true copy of the register of members of the Koubei Holdco reflecting AGH Co’s and ANT Co’s ownership of such additional Shares; and

 

(iii)                               two (2) counterparts of Data Platform Participation Agreement duly executed by AGH and the Koubei Holdco;

 

(c)                                  Single Transaction.  Notwithstanding anything contrary in this Agreement, all actions to be performed at the Second Closing shall be deemed a single transaction so that, at the option of the Party for whose benefit an action is to be performed, the Second Closing shall not be deemed to have taken place unless and until all such actions have been performed.

 

6.2.                            CONDITIONS TO THE SECOND CLOSING

 

The Second Closing is conditional on the satisfaction or waiver of the following conditions (the “Second Closing Conditions”):

 

(a)                                 ANT shall have obtained all Governmental Approvals that are necessary under PRC Laws for ANT, a PRC entity, to make overseas direct investment and consummate the transactions contemplated by this Agreement and the Ancillary Agreements, including the payment of its proportion of the Second Capital Contributions.  Such Governmental Approvals shall include, without limitation, the outbound investment filing with the Management Committee of the China (Shanghai) Free Trade Zone and the foreign exchange registration with the relevant bank.

 

(b)                                 All obligations of the Parties relating to the Koubei Hangzhou Opco and the VIE Subsidiary in Section 3.3 having been performed or complied with.

 

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(c)                                  AGH’s obligations in respect of the Second Closing shall be conditional on ANT’s portion of the Second Capital Contributions having been made, and such condition shall only be waivable by AGH.

 

(d)                                 ANT’s obligations in respect of the Second Closing shall be conditional on AGH’s portion of the Second Capital Contributions having been made, and such condition shall only be waivable by ANT.

 

Each of the Parties shall use its best endeavors to fulfill or procure the fulfillment of all the Second Closing Conditions for which it (or its Affiliates) is responsible as soon as practicable and in any event on or before December 31, 2015 (as may be extended by the Parties in writing).

 

ARTICLE 7

 

POST INITIAL CLOSING COVENANTS

 

7.1.                            FIXED ASSETS

 

(a)                                 Definitions.  The following terms shall have the following meanings for the purposes of this Section 7.1:

 

“AGH Fixed Assets” means the Fixed Assets owned by AGH and/or its Subsidiaries, including but not limited to portable device for office use, such as computers, mobile phones and office equipment used by the AGH Employees (as defined in Section 7.2(a)) primarily for the Permitted Company Business, as may be more specifically determined or adjusted by an agreement in writing by the Parties within fifteen (15) Business Days after March 31, 2016.

 

“ANT Fixed Assets” means the Fixed Assets owned by ANT and/or its Subsidiaries, including but not limited to portable device for office use, such as computers, mobile phones and office equipment used by the ANT Employees (as defined in Section 7.2(a)) primarily for the Permitted Company Business, as may be more specifically determined or adjusted by an agreement in writing by the Parties within fifteen (15) Business Days after March 31, 2016.

 

“Fixed Assets” means the fixed assets used primarily for the Permitted Company Business, excluding the fixed assets used primarily for “AGH Services” and “ANT Services” under the Shared Services Agreement.

 

(b)                                 AGH Fixed Assets.  On or before March 31, 2016 (or any other date agreed in writing by the Parties): (i) AGH shall cause all AGH Fixed Assets to be sold, transferred and delivered to the Koubei Shanghai Opco (or any other Joint Venture Entity designated by the Koubei Holdco) free and clear of any Encumbrances at the book value of such assets as of the date of the transfer; and (ii) the Parties shall cause such transferee to purchase and accept such assets.

 

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(c)                                  ANT Fixed Assets.  On or before March 31, 2016 (or any other date agreed in writing by the Parties): (i) ANT shall cause that all ANT Fixed Assets to be sold, transferred and delivered to the Koubei Shanghai Opco (or any other Joint Venture Entity designated by the Koubei Holdco) free and clear of any Encumbrances at the book value of such assets as of the date of the transfer; and (ii) the Parties shall cause such transferee to purchase and accept such assets.

 

7.2.                            EMPLOYEES

 

(a)                                 Definitions.  The following terms shall have the following meanings for the purposes of this Section 7.2:

 

“AGH Employees” means the employees whose primary job responsibilities are principally related to the Permitted Company Business as of the date immediately prior to the Initial Closing, including but not limited to those in the business development, operation, business development back office support, products, marketing, client and new employee training, business intelligence, technical development, user experience design, regional service centers support, customer services, administration, human resources and finance departments of Taodiandian team of AGH or its Subsidiaries, and as may be determined and adjusted by an agreement in writing by the Parties.

 

“ANT Employees” means the employees whose primary job responsibilities are principally related to the Permitted Company Business as of the date immediately prior to the Initial Closing, including but not limited to those in the business development, products, operation, business development back office support, customer services, business intelligence, technical development, user experience design, sales, finance, legal, human resources, public relations, government relations and administration departments of ANT or its Subsidiaries, and as may be determined and adjusted by an agreement in writing by the Parties.

 

(b)                                 AGH Employees.  As soon as practicable after the establishment of the Koubei Shanghai Opco, but in any event no later than March 31, 2016 (or any other date agreed in writing by the Parties):

 

(i)                                     AGH shall use its best efforts for the benefits of the Joint Venture to cause all of the existing employment contracts with the AGH Employees to be terminated; and

 

(ii)                                  the Parties shall cause the Koubei Shanghai Opco (or any other Joint Venture Entity) to enter into a new employment contract with each of the AGH Employees referred to in sub-paragraph (i) above, it being understood that each such new employment contract shall take effect immediately after the termination of the relevant existing employment contract.

 

(c)                                  ANT Employees.  As soon as practicable after the establishment of the Koubei Shanghai Opco, but in any event no later than March 31, 2016 (or any other date agreed in writing by the Parties):

 

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(i)                                     ANT shall use its best efforts for the benefits of the Joint Venture to cause all of the existing employment contracts with the ANT Employees to be terminated; and

 

(ii)                                  the Parties shall cause the Koubei Shanghai Opco (or any other Joint Venture Entity) to enter into a new employment contract with each of the ANT Employees referred to in sub-paragraph (i) above, it being understood that each such new employment contract shall take effect immediately after the termination of the relevant existing employment contract.

 

(d)                                 Responsibilities and Covenant to Assist.  The Parties shall cause AGH and ANT (as the case may be) to assume and be fully responsible for the payment of any and all accrued payroll, vacation pay, sick pay, severance, accrued but unpaid bonuses, Social Security Benefits and other benefits (including all related taxes with respect to such payments) related to or payable upon the termination of the employment of the AGH Employees and the ANT Employees (as the case may be).  AGH shall use its best efforts to assist the Koubei Shanghai Opco (or any other Joint Venture Entity) to employ and retain the AGH Employees.  ANT shall use its best efforts to assist the Koubei Shanghai Opco (or any other Joint Venture Entity) to employ and retain the ANT Employees.

 

(e)                                  Social Security Benefits.  Each of AGH and ANT shall use its best efforts to ensure that the Koubei Shanghai Opco (or any other Joint Venture Entity) will establish branches or subsidiaries in relevant localities which are necessary for the Joint Venture to contribute Social Security Benefits for its employees located at such localities pursuant to applicable Laws.

 

(f)                                   Equity Incentive Awards.  The Joint Venture shall launch its equity incentive plan(s) on or prior to March 31, 2016 and such equity incentive plan(s) will become effective as of March 31, 2016.  Prior to March 31, 2016, AGH and ANT (or ANT’s Affiliate) will grant equity incentive awards pursuant to their respective equity incentive plans as on-hire grants to AGH Newly Recruited JV Employees, ANT Newly Recruited JV Employees and Joint Venture Newly Recruited Employees who have the responsibilities or perform the functions of senior members of the management of the Joint Venture (as determined by AGH, ANT (or ANT’s Affiliate) and the Joint Venture jointly).  The equity incentive awards granted by each of AGH and ANT (or ANT’s Affiliate) to such AGH Newly Recruited JV Employees, ANT Newly Recruited JV Employees and Joint Venture Newly Recruited Employees under its equity incentive plan(s) pursuant to this Section 7.2(f) shall have the aggregate fair market value equal to fifty percent (50%) of the sum of the AGH Fair Market Value and ANT Fair Market Value of all equity incentive awards granted by AGH and ANT (as the case may be) to such AGH Newly Recruited JV Employees, ANT Newly Recruited JV Employees and Joint Venture Newly Recruited Employees, subject to adjustment as determined by AGH and ANT by reference to the human resources policies of AGH and ANT respectively.

 

7.3.                            BUSINESS CONTRACTS

 

(a)                                 Definitions.  The following terms shall have the following meanings for the purposes of this Section 7.3:

 

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“AGH Contracts” means the Contracts that relate primarily to the Permitted Company Business engaged by the Taodiandian business as described in Exhibit 7.3(a) hereto which shall be further updated by AGH within 20 Business Days after the Initial Closing to reflect the Contracts that relate primarily to the Permitted Company Business engaged by Taodiandian business effective as of the date immediately prior to the date of the Initial Closing.

 

“ANT Contracts” means the Contracts that relate primarily to the Permitted Company Business engaged by ANT and its Subsidiaries as described in Exhibit 7.3(b) hereto which shall be further updated by ANT within 20 Business Days after the Initial Closing to reflect the Contracts that relate primarily to the Permitted Company Business engaged by ANT and its Subsidiaries effective as of the date immediately prior to the date of the Initial Closing.

 

“Assigned Obligations” means all the Obligations in relation to the rights relating to payment related merchant operation that has been assigned to the assignee in accordance with Section 7.3(c)(ii) below.

 

“Contract Rights” means any right, power or remedy of any nature under any Contract, including rights to receive property or services or otherwise derive benefits from the payment, satisfaction or performance of another party’s Obligations, rights to demand that another party accept property or services or take any other actions, and rights to pursue or exercise remedies or options.

 

“Obligation” means any debt, liability or obligation of any nature, whether secured, unsecured, recourse, nonrecourse, liquidated, unliquidated, accrued, absolute, fixed, contingent, ascertained, unascertained, known, unknown or otherwise.

 

(b)                                 AGH Contracts.  As soon as practicable after the establishment of the Koubei Shanghai Opco, but in any event no later than March 31, 2016 (or any other date agreed in writing by the Parties):

 

(i)                                     AGH shall use commercially reasonable efforts to arrange for and cause that all of the Contract Rights of it and its Subsidiaries under each of the AGH Contracts to be conveyed, assigned and transferred to the Koubei Shanghai Opco (or any other Joint Venture Entity); and

 

(ii)                                  the Parties shall cause the assignee referred to in sub-paragraph (i) above to (1) accept such Contract Rights and (2) assume and be fully responsible for any and all Obligations of AGH and its Subsidiaries of any kind under each such AGH Contract, whether currently existing or hereinafter created.

 

(c)                                  ANT Contracts.  As soon as practicable after the establishment of the Koubei Shanghai Opco, but in any event no later than March 31, 2016 (or any other date agreed in writing by the Parties):

 

(i)                                     ANT shall use commercially reasonable efforts to arrange for and cause Koubei Holdco and/or any of the Joint Venture Entities to be parties to all of the ANT Contracts or other relevant documents which are to be

 

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assigned or novated either alone or together with ANT and/or its Subsidiaries; provided, however, ANT may postpone the assignment and novation of the ANT Remaining Contracts (as defined below) pursuant to Section 7.3(c) for purposes of maintaining good customer relationships;

 

(ii)                                  the Parties shall cause the assignee referred to in sub-paragraph (i) above to (1) accept such Contract Rights relating to payment related merchant operation and (2) assume and be fully responsible for any and all Assigned Obligations of ANT and its Subsidiaries under each such ANT Contract, whether currently existing or hereinafter created; and

 

(iii)                               If by March 31, 2016, there remains any ANT Contracts to which none of the Joint Venture Entities is a Party (“ANT Remaining Contracts”), ANT shall provide a list of such ANT Remaining Contracts within one (1) month of March 31, 2016.

 

(d)                                 ANT Remaining Contracts.  With respect to the ANT Remaining Contracts, the Parties agree that:

 

(i)                                     ANT and/or its Subsidiaries may continue to perform its Obligations under each ANT Remaining Contract and complete the transactions contemplated thereby in accordance with the terms thereof; and

 

(ii)                                  subject always to the terms and conditions of the Shareholders Agreement, an unanimous approval by members of the Board of Directors appointed by AGH and ANT (for the avoidance of doubt, approval from directors appointed by shareholders of Koubei Holdco other than AGH and ANT is not required) is required to make decision to take one of the following courses of actions in the event of a renewal of any ANT Remaining Contract with an external third party to such contract:

 

(1)                     one or more Joint Venture Entities, instead of ANT and/or its Subsidiaries, will enter into the renewal contract with the relevant third party(ies); or

 

(2)                     ANT and/or its Subsidiaries, instead of a Joint Venture Entity, will enter into the renewal contract with the relevant party(ies); or

 

(3)                     one or more Joint Venture Entities and ANT and/or its Subsidiaries will enter into the renewal contract together with the relevant party(ies).

 

7.4.                            COST REIMBURSEMENT

 

(a)                                 Definitions.  The following terms shall have the following meanings for the purposes of this Section 7.4:

 

“AGH Reimbursable Employee Expenses” means the aggregate of the following expenses incurred by AGH and its Affiliates:

 

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(i)                                     the amount equal to the aggregate Fair Market Value of all on-hire equity incentive awards granted by AGH under its equity incentive plan(s) to any and all AGH Newly Recruited JV Employees;

 

(ii)                                  the amount equal to the aggregate Fair Market Value of all on-hire equity incentive awards granted by AGH under its equity incentive plan(s) to any and all Joint Venture Newly Recruited Employees;

 

(iii)                               the aggregate amount of the year-end salaries exceeding the 12-month salaries paid by AGH and its Subsidiaries to its and their employees during Fiscal Year 2016 who subsequently commenced employment with the Joint Venture (pursuant to Section 7.2(b)), provided that the payment of such salaries were made before commencement of such employees’ employment with the Joint Venture;

 

(iv)                        the aggregate amount of the regular salaries and Social Security Benefits paid to or for each of the employees of AGH and its Subsidiaries that subsequently commenced employment with the Joint Venture (pursuant to Section 7.2(b)) for the period commencing from September 1, 2015 and ending on the date immediately prior to the date on which such employees commence employment with the Joint Venture; and

 

(v)                           For the purpose of this definition, “AGH Fair Market Value” means, as of date of granting on-hire equity incentive awards by AGH, which shall be the closing sales price for such shares as quoted on the principal exchange or system on which the shares are listed or traded on the grant date, such as New York Stock Exchange, or, if the grant date is not a trading date, the closing sales price as quoted on the principal exchange or system on which the shares are listed or traded on the trading date immediately preceding the grant date.

 

“ANT Reimbursable Employee Expenses” means the aggregate of the following expenses incurred by ANT and its Affiliates:

 

(i)                               the amount equal to the aggregate Fair Market Value of all on-hire equity incentive awards granted by ANT and/or its Affiliate under its equity incentive plan(s) to any and all ANT Newly Recruited JV Employees;

 

(ii)                            the amount equal to the aggregate Fair Market Value of all on-hire equity incentive awards granted by ANT and/or its Affiliate under its equity incentive plan(s) to any and all Joint Venture Newly Recruited Employees;

 

(iii)                         the aggregate amount of the year-end salaries exceeding the12-month salaries paid by ANT and its Subsidiaries to its and their employees during Fiscal Year 2016 who subsequently commenced employment with the Joint Venture (pursuant to Section 7.2(c)), provided that payment of such salaries were made before commencement of such employees’ employment with the Joint Venture;

 

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(iv)                        the aggregate amount of the regular salaries and Social Security Benefits paid to or for each of the employees of ANT and its Subsidiaries (who subsequently commence employment with the Joint Venture pursuant to Section 7.2(c)) during the period commencing from September 1, 2015 and ending on the date immediately prior to the date on which such employees commence employment with the Joint Venture; and

 

(v)                           For the purpose of this definition, “ANT Fair Market Value” means the value of the equity securities of ANT underlying the equity incentive award(s) granted by ANT and/or its Affiliate pursuant to Section 7.2(f), as of the date of grant of the applicable equity incentive award(s), to be determined in good faith by the board of directors of ANT or such other persons as authorized by the board of directors of ANT.

 

(b)                                 AGH/ANT Reimbursable Employee Expenses.  Within one (1) month after March 31, 2016 (or any other date agreed in writing by the Parties), the Parties shall cause the Joint Venture to reimburse (i) to AGH the AGH Reimbursable Employee Expenses and (ii) to ANT the ANT Reimbursable Employee Expenses.

 

(c)                                  Other Expenses.  After March 31, 2016, if any of AGH, ANT and their respective Affiliates incurs any expenses for the Joint Venture resulting from the Joint Venture’s non-cooperation and non-performance of its obligations under Sections 7.1, 7.2 and 7.3, the Parties shall cause the Joint Venture to reimburse such expenses to such relevant Person.  The Parties shall cause the Joint Venture to pay and reimburse:

 

(i)                                     AGH the considerations for, and expenses incurred by AGH (if any) related to, the transfer of AGH Fixed Assets, and

 

(ii)                                  ANT the considerations for, and expenses incurred by AGH (if any) related to, the transfer of ANT Fixed Assets (if any), in each case, within one (1) month after March 31, 2016.

 

(d)                                 Invoicing and Settlement of Reimbursement Amount(s).  With respect to each of the reimbursements referred to in paragraphs (b) to (c) above, each recipient of the applicable reimbursements shall invoice the Joint Venture (with a copy to the other Party) at least five (5) Business Days prior to the due date for settlement of reimbursement amount(s).  If the Joint Venture fails to make any payment of any undisputed reimbursement amount(s) due to a relevant recipient of reimbursement amount(s) under this Section 7.4 by the due date, such recipient shall be entitled to charge interest on such unpaid amount(s) at an annual rate equal to twelve percent (12%), accruing from the due date for such settlement of such reimbursement amount(s).  If, after thirty (30) days after the original due date for the relevant payment, the Parties have not resolved any dispute about any amount(s) actually owed, the Parties shall submit such dispute for dispute resolution in accordance with Section 11.5 of this Agreement.  The Joint Venture shall pay all amounts due under this Section 7.4 in Renminbi unless otherwise agreed by the Parties.

 

7.5.                            CONTROL OF VIE SUBSIDIARY

 

The Parties shall take such steps as are necessary to ensure that, within thirty (30) days after the Initial Closing, (i) the particulars of the VIE Subsidiary are consistent with those set out

 

22

 

in Exhibit 3.3(c) and (ii) the VIE Subsidiary is Controlled by the Koubei Hangzhou Opco through a VIE Structure.

 

ARTICLE 8

 

REPRESENTATIONS AND WARRANTIES

 

Each Party hereby represents and warrants to the other as follows:

 

8.1.                            CORPORATE ORGANIZATION

 

It is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation and governance.

 

8.2.                            AUTHORIZATION

 

It has corporate power and authority to enter into this Agreement and the Ancillary Agreements to which it is a party, and to perform the obligations hereunder and thereunder.  The execution, delivery and performance of this Agreement and the Ancillary Agreements to which it is a party and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate, entity or other actions.  This Agreement has been duly executed and delivered by it and, assuming the due authorization, execution and delivery by the other Party, this Agreement constitutes a valid and binding agreement enforceable against it in accordance with its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar laws of general applicability relating to or affecting creditor’s rights, and general equitable principles).  All Governmental Approvals required to make the execution and performance of this Agreement valid and binding upon such Party have been or will be obtained prior to the Initial Closing.

 

8.3.                            NO VIOLATION

 

The execution, delivery and performance of this Agreement by such Party will not (i) conflict with or violate any Law or Order applicable to it or (ii) conflict with, or result in a breach of or default under, any terms or conditions of the by-laws or other organizational documents or material contract, or other material obligation of such Party and such Party knows of no circumstance which would prevent its performance of this Agreement.

 

8.4.                            LITIGATION

 

There is no action, suit, Proceeding or claim affecting the Party or its interest in the Joint Venture pending or to the knowledge of such Party threatened in any court or by or before any commission, board, bureau, agency or other governmental instrumentality which could reasonably be expected to prevent the consummation by such Party of the transactions contemplated in this Agreement, the Ancillary Agreements or the performance of its obligations hereunder and thereunder.

 

23

 

8.5.                            FIXED ASSETS

 

With respect to the fixed assets to be transferred by such Party (or its Affiliates) to the Joint Venture pursuant to Section 7.1 of this Agreement, on the date of the transfer, such Party (or its Affiliates) will be the lawful and (where applicable) registered owner of such fixed assets and has the capacity and authority to transfer to the Joint Venture such fixed assets free of any Encumbrances.

 

8.6.                            CERTAIN CONTRACTS

 

With respect to the contractual arrangements made by such Party (or its Affiliates) under Section 7.3 of this Agreement, on the date on which such arrangements are effectuated, such Party (or its Affiliates) is the lawful owner of the relevant contractual rights and has the capacity and authority to assign such rights to the Joint Venture.

 

8.7.                            EXCLUSIVITY OF REPRESENTATIONS

 

The representations and warranties made by such Party in this Article 8 are the exclusive representations and warranties made by such Party with respect to this Agreement and the transactions contemplated hereby.

 

ARTICLE 9

 

COVENANTS

 

9.1.                            CONFIDENTIALITY

 

Each Party, and each Party’s Representatives who receive Confidential Information as permitted hereunder, shall maintain the confidentiality of Confidential Information in accordance with the procedures adopted by such Party in good faith to protect confidential information of third parties generally delivered to such Party; provided that such Party may deliver or disclose Confidential Information to:

 

(a)                                 such Party’s Representatives, and Persons related thereto who are informed of the confidentiality obligations of this Section 9.1; provided that such Party shall be responsible for any violation of such Party’s applicable procedures made by any such Person;

 

(b)                                 any Governmental Authority having jurisdiction over such Party to the extent required by applicable Law;

 

(c)                                  any other Person to which such delivery or disclosure may be required (i) to effect compliance with any Law applicable to such Party, or (ii) in response to any subpoena or other legal process; or

 

(d)                                 as permitted under Section 9.3;

 

provided that, in the cases of paragraphs (b) and (c) of this Section 9.1, the disclosing Party shall provide each other Party with prompt written notice thereof so that the appropriate

 

24

 

Party may seek (with the cooperation and reasonable efforts of the disclosing party) a protective Order, confidential treatment or other appropriate remedy, and in any event shall furnish only that portion of the information which is reasonably necessary for the purpose at hand and shall exercise reasonable efforts to obtain reliable assurance that confidential treatment will be accorded such information to the extent reasonably requested by any other Party.

 

9.2.                            APPROPRIATE ACTION; CONSENTS; FILINGS.

 

(a)                                 Each Party shall, promptly upon being required to do so by the other Party, do or procure that there shall be done all such acts and things and execute or procure the execution of all such documents and instruments in a form satisfactory to the first-mentioned Party as the first-mentioned Party may from time to time reasonably require (before or after Initial Closing) in order to give full effect to this Agreement and to secure to the first-mentioned Party the full benefit of the rights, powers and remedies conferred upon the first-mentioned Party in this Agreement.

 

(b)                                 Subject to applicable Law, each Party shall furnish to each other such necessary information and reasonable assistance as the other may request in connection with the preparation of any required filings or submissions with any Governmental Authority and will reasonably cooperate in responding to any inquiry from a Governmental Authority, including promptly informing the other party of such inquiry, consulting in advance before making any presentations or submissions to a Governmental Authority, and supplying each other with copies of all material correspondence, filings or communications with any Governmental Authority with respect to this Agreement (other than private or personal information pertaining to any individual applicants which may remain confidential).  No Party shall have any material communication or meeting (telephonic or in-person) regarding the transactions contemplated by this Agreement with a Governmental Authority without giving the other Party a reasonable opportunity to attend in person or by phone (unless the Governmental Authority prohibits such participation or attendance in the communication or meeting).

 

9.3.                            PUBLIC ANNOUNCEMENT AND FILINGS.

 

The Parties shall require mutual consent before issuing, and, to the extent practicable, give each other a reasonable opportunity to review and comment on, any press release or other public announcement with respect to this Agreement and the transactions contemplated hereby, and shall not issue any such press release or make any such public announcement prior to obtaining such mutual consent, except as may be required by applicable Law, court process or the rules and regulations of any national securities exchange or national securities quotation system.

 

25

 

ARTICLE 10

 

TERMINATION

 

10.1.                     TERMINATION

 

(a)                                 Notwithstanding anything in this Agreement to the contrary, this Agreement and the transactions contemplated hereby may, by written notice given at any time prior to the Initial Closing, be terminated:

 

(i)                                     by mutual written consent of AGH and ANT;

 

(ii)                                  by either AGH or ANT, without liability to the other party on account of such termination if the Initial Closing has not occurred (other than through the failure of any Party seeking to terminate this Agreement to fully comply with its obligations hereunder) on or before the Long Stop Date;

 

(iii)                               by either AGH or ANT, if a material breach of any provision of this Agreement has been committed by the other Party and such breach has not been waived or cured within thirty (30) days after the receipt of the notice thereof; provided, however, that termination pursuant to this Section 10.1(a)(iii) shall not relieve the breaching party of liability for such breach or otherwise; and

 

(iv)                              by either AGH or ANT, if any Governmental Authority shall have issued, enacted, entered, promulgated or enforced any order, or taken any other action restraining, enjoining or otherwise prohibiting the issuance of the Shares or the consummation of any other material transactions contemplated hereby and such order, or other action shall have become final and non-appealable, provided that the right to terminate this Agreement pursuant to this Section 10.1(a)(iv) shall not be available to any Party that has failed to fully comply with its obligations hereunder in any manner that shall have proximately contributed to the occurrence of such order.

 

10.2.                     EFFECT OF TERMINATION

 

Surviving Provisions.  In the event of the termination of this Agreement pursuant to Section 10.1 of this Agreement, this Agreement (other than Section 9.1 (Confidentiality), Section 9.3 (Public Announcement and Filings) and Article 11 (General Provisions), which shall remain in full force and effect) shall forthwith become null and void.

 

26

 

ARTICLE 11

 

GENERAL PROVISIONS

 

11.1.                     NOTICES

 

Any notice, request, instruction or other document to be given hereunder by a Party to another Party hereto shall be in writing, delivered in person, or mailed by certified or registered mail, return receipt requested, or transmitted by facsimile transmission with electronic confirmation of receipt, or sent by email, return receipt requested, to the addressee’s address, facsimile number or email address set forth below (or such other address, facsimile number or email address as the Party changing its address specifies in a notice to the other parties):

 

	
(a)
    	
if to a Joint   Venture Entity, then to:
    
	
 
    	
 
    
	
 
    	
Facsimile No.:
    	
 
    
	
 
    	
Email:
    	
 
    
	
 
    	
Attention:
    	
 
    
	
 
    	
 
    
	
(b)
    	
if to AGH, then   to:
    
	
 
    	
 
    
	
 
    	
Attention:
    	
 
    
	
 
    	
Facsimile No.:
    	
 
    
	
 
    	
Email:
    	
 
    
	
 
    	
 
    
	
 
    	
with a copy to   (which shall not constitute notice):
    
	
 
    	
 
    
	
 
    	
Fangda Partners   (Shanghai Office)
    
	
 
    	
Attention:
    	
 
    
	
 
    	
Facsimile No.:
    	
 
    
	
 
    	
Email:
    	
 
    

 

27

 

	
and              (c)
    	
if to ANT:
    
	
 
    	
 
    
	
 
    	
Attention:
    	
 
    
	
 
    	
Facsimile No.:
    	
 
    
	
 
    	
Email:
    	
 
    
	
 
    	
 
    
	
 
    	
with a copy to (which shall not constitute notice):
    
	
 
    	
 
    
	
 
    	
King & Wood Mallesons
    
	
 
    	
Attention:
    	
 
    
	
 
    	
Facsimile No.:
    	
 
    
	
 
    	
Email:
    	
 
    

 

Notices shall be deemed to have been given on the date of service, if served personally on the Party to whom notice is to be given, or on the first Business Day after transmission by facsimile or email transmission, if transmitted by facsimile or email as set forth above, or on the fifth Business Day after mailing, if mailed as set forth above.

 

11.2.                     WAIVER

 

No waiver shall be deemed to have been made by any Party of any of its rights under this Agreement unless the same is in writing and is signed on its behalf by its authorized officer.  Any such waiver shall constitute a waiver only with respect to the specific matter described in such writing and shall in no way impair the rights of the Party granting such waiver in any other respect or at any other time.

 

11.3.                     SEVERABILITY

 

If any provision of this Agreement shall be held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

11.4.                     GOVERNING LAW

 

This Agreement shall be governed by and construed and interpreted in accordance with the Law of the State of New York, which shall govern this Agreement and any controversy or claim arising out of or, to the extent permitted by applicable Law, relating to this Agreement.

 

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11.5.                     ARBITRATION

 

(a)                                 Any dispute, controversy, difference or claim arising out of or relating to this Agreement, including the existence, validity, interpretation, performance, breach or termination thereof or any dispute regarding non-contractual obligations arising out of or relating to it shall be referred to and finally resolved by arbitration administered by the Hong Kong International Arbitration Centre (“HKIAC”) under the UNCITRAL Arbitration Rules in force when the notice of arbitration is submitted.  The arbitration shall be conducted in Hong Kong.

 

(b)                                 The arbitration shall be conducted by three (3) arbitrators.  For the arbitration tribunal, the claimant(s) shall jointly appoint one (1) member of the arbitration tribunal and the respondent(s) shall jointly appoint one (1) member of the arbitration tribunal. The appointment of the third arbitrator shall be agreed by the claimant(s) and the respondent(s). If they fail to reach such an agreement within thirty (30) days after the appointment of the first member of the arbitration tribunal, the HKIAC shall appoint the third arbitrator.  The third arbitrator shall act as chair of the tribunal.

 

(c)                                  The arbitral award shall be in writing, state the reasons for the award, and be final and binding on the parties.

 

(d)                                 In order to facilitate the comprehensive resolution of related disputes, and upon request of any Party to the arbitration Proceeding, the arbitration tribunal may, within ninety (90) days of its appointment, consolidate the arbitration Proceeding with any other arbitration Proceeding involving any of the Parties relating to this Agreement and Ancillary Agreements.  The arbitration tribunal shall not consolidate such arbitrations unless it determines that (i) there are issues of fact or law common to the Proceedings, so that a consolidated Proceeding would be more efficient than separate Proceedings, and (ii) no Party would be prejudiced as a result of such consolidation through undue delay or otherwise.  In the event of different rulings on this question by the arbitration tribunal constituted hereunder and any tribunal constituted under this Agreement and Ancillary Agreements, the ruling of the tribunal constituted under this Agreement shall govern, and that tribunal shall decide all disputes in the consolidated Proceeding.

 

(e)                                  The Parties agree that the arbitration shall be kept confidential and that the existence of the Proceeding and any element of it (including any pleadings, briefs or other documents submitted or exchanged, any testimony or other oral submissions, and any awards) shall not be disclosed beyond the tribunal, the HKIAC, the Parties, their counsel and any person necessary to the conduct of the Proceeding, except as may be lawfully required in judicial Proceedings relating to the arbitration or otherwise, or as required by the New York Stock Exchange rules or the rules of any other quotation system or exchange on which the disclosing Party’s equity securities are listed or applicable Law.

 

(f)                                   Notwithstanding this Section 11.5 or any other provision to the contrary in this Agreement, no Party shall be obligated to follow the foregoing arbitration procedures where such Party intends to apply to any court of competent jurisdiction for an interim injunction or similar equitable relief against any other Party; provided that there is no unreasonable delay in the prosecution of that application.  None of the Parties shall institute a Proceeding in any court or administrative agency to resolve a dispute arising out of, relating to or in connection with this Agreement or the other Ancillary Agreements, except for a court proceeding to compel

 

29

 

arbitration or otherwise enforce this agreement to arbitrate, to enforce an order or award of the arbitration tribunal or petition for the provisional or emergency remedies provided for herein.

 

11.6.                     COUNTERPARTS

 

This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which shall be deemed to constitute one and the same instrument.

 

11.7.                     NO CONSEQUENTIAL DAMAGES

 

Neither Party or its Affiliates shall be liable to the other Party or its Affiliates for any indirect, incidental, special or consequential damages relating to a breach or alleged breach of this Agreement, including, but not limited to, loss of revenue, cost of capital or loss of business reputation or opportunity, whether such liability arises out of contract, tort (including negligence), strict liability or otherwise.

 

11.8.                     SUCCESSORS AND ASSIGNS

 

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

 

11.9.                     LIMITATION ON RIGHTS OF OTHERS

 

This Agreement is entered into between the Parties for the exclusive benefit of its Parties, and their successors and permitted assigns.  This Agreement is not intended to and shall not be construed to confer any benefits upon, or create any rights (including, without limitation, any third party beneficiary rights) in favor of, any Person other than the Parties.

 

11.10.              ENTIRE AGREEMENT; AMENDMENT

 

This Agreement, together with the Ancillary Agreements, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, whether oral or written, between the Parties (and their Affiliates) with respect to the subject matter hereof.  This Agreement may be amended only in writing signed by both Parties.

 

11.11.              EXPENSES

 

Except as otherwise provided herein or agreed to in writing by the Parties, each Party shall bear its own costs and expenses, including legal fees, associated with carrying on its business as a Party hereof.

 

11.12.              CONSTRUCTION

 

This Agreement has been submitted to the scrutiny of, and has been negotiated by, both Parties and their counsel, and shall be given a fair and reasonable interpretation in accordance with the terms hereof without consideration or weight being given to its having been drafted by any Party hereto or its counsel.

 

30

 

11.13.              DISCLAIMER OF AGENCY

 

This Agreement does not create any entity or relationship beyond the scope set forth herein, and except as otherwise expressly provided herein, this Agreement shall not constitute any Party the legal representative or agent of the other, nor shall any Party or any Affiliate of a Party have the right or authority to assume, create or incur any liability or obligation, express or implied, against, in the name of or on behalf of any other Party, its Affiliates, a Joint Venture Entity or its Affiliates.

 

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IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by their respective officers thereunto duly authorized as of the date first written above.

 

 

	
 
    	
Alibaba   Group Holding Limited
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Timothy A. Steinert
    
	
 
    	
Name:
    	
Timothy   Alexander Steinert
    
	
 
    	
Title:
    	
Authorized   Signatory
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
浙江蚂蚁小微金融服务集团有限公司
    
	
 
    	
(Zhejiang   Ant Small and Micro Financial Services Group Co., Ltd.)
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Jianwei Tu
    
	
 
    	
Name:
    	
Jianwei   Tu
    
	
 
    	
Title:
    	
Authorized   Signatory
    
				

 

[Signature Page to the Share Subscription Agreement]QuickLinks
 -- Click here to rapidly navigate through this document

 

 
 

  Exhibit 4.2    
    

 
 

  FORM OF REGISTRATION RIGHTS AGREEMENT    
    

        This Registration Rights Agreement (this "Agreement") is made and entered into as
of                 , 2015, by and among Midstates Petroleum Company, Inc., a Delaware corporation (the "Company"),
 Midstates Petroleum
Company LLC, a Delaware limited liability company ("Midstates Sub" and, together with the Company, the
"Issuers"), and
[                                    ] (the "Initial Purchaser"), which has agreed to
purchase the Issuers' 10.0% Senior Secured Second Lien Notes due 2020 (the "Initial Notes") pursuant to the Purchase Agreement (as defined below). The
Initial Notes will be fully and unconditionally guaranteed on a senior secured basis, jointly and severally, by any subsidiary of the Company formed or acquired after the Closing Date that executes a
guarantee in accordance with the terms of the Indenture, and their respective successors and assigns (collectively, the "Guarantors"), pursuant to their
guarantees (the "Guarantees"). The Initial Notes and any future Guarantee attached thereto are herein collectively referred to as the
"Initial Securities." 

        This
Agreement is made pursuant to the Purchase Agreement, dated May 19, 2015 (the "Purchase Agreement"), among the Issuers and the
Initial Purchaser (i) for the benefit of the Initial Purchaser and (ii) for the benefit of the holders from time to time of the Initial Securities, including the Initial Purchaser. In
order to induce the Initial Purchaser to purchase the Initial Securities, the Issuers have agreed to provide the registration rights set forth in this Agreement. The execution and delivery of this
Agreement is a condition to the obligations of the Initial Purchaser set forth in Section 5(g) of the Purchase Agreement. 

        The
parties hereby agree as follows: 

        SECTION 1.
Definitions. As used in this Agreement, the following capitalized terms shall have the following meanings: 

        Additional Interest:    As defined in Section 5 hereto. 

         Broker-Dealer:    Any broker or dealer registered under the Exchange Act. 

         Business Day:    Shall have the meaning ascribed to such term in Rule 14d-1 under the Exchange Act. 

         Closing Date:    The date of this Agreement. 

        Commission:    The Securities and Exchange Commission. 

         Company:    As defined in the preamble hereto. 

         Consummate:    A registered Exchange Offer shall be deemed "Consummated" for purposes of this Agreement upon the occurrence of
(i) the filing and
effectiveness under the Securities Act of the Exchange Offer Registration Statement relating to the Exchange Securities to be issued in the Exchange Offer, (ii) the maintenance of such
Registration Statement continuously effective and the keeping of the Exchange Offer open for a period not less than the minimum period required pursuant to  Section 3(b) hereof, and (iii) the
delivery by the Issuers to the Registrar under the Indenture of
Exchange Securities in the same aggregate principal amount as the aggregate principal amount of Initial Securities that were tendered by Holders thereof pursuant to the Exchange Offer. 

         EDGAR:    The Electronic Data Gathering, Analysis and Retrieval system of the Commission. 

        Exchange Act:    The Securities Exchange Act of 1934, as amended. 

         Exchange Offer:    The registration by the Issuers under the Securities Act of the Exchange Securities pursuant to a Registration
Statement pursuant to
which the Issuers offer the Holders of all outstanding Transfer Restricted Securities the opportunity to exchange all such outstanding Transfer Restricted Securities held by such Holders for Exchange
Securities in an aggregate principal amount 

 

equal
to the aggregate principal amount of the Transfer Restricted Securities tendered in such exchange offer by such Holders. 

         Exchange Offer Registration Statement:    The Registration Statement relating to the Exchange Offer, including the related Prospectus, as
defined in  Section 3(a) hereof. 

        Exchange Deadline:    As defined in Section 3(b) hereof. 

         Exchange Securities:    The 10.0% Senior Secured Second Lien Notes due 2020, of the same series under the Indenture as the Initial Notes
and any
Guarantee attached thereto, to be issued to Holders in exchange for Transfer Restricted Securities pursuant to this Agreement. 

         FINRA:    The Financial Industry Regulatory Authority, Inc., an independent regulatory organization. 

        Guarantees:    As defined in the preamble hereto. 

         Guarantors:    As defined in the preamble hereto. 

         Holders:    As defined in Section 2(b) hereof. 

         Indemnified Holder:    As defined in Section 8(a) hereof. 

        Indenture:    The Indenture, dated as of May 21, 2015, between the Issuers and Wilmington Trust, National Association, as trustee (the
"Trustee"), pursuant to which the Securities are to be issued, as such Indenture is amended or supplemented from time to time in accordance with the
terms thereof. 

         Initial Notes:    As defined in the preamble hereto. 

        Initial Placement:    The issuance and sale by the Issuers of the Initial Securities to the Initial Purchaser pursuant to the Purchase
Agreement. 

         Initial Purchaser:    As defined in the preamble hereto. 

         Initial Securities:    As defined in the preamble hereto. 

         Interest Payment Date:    As defined in the Securities. 

        Issuers:    As defined in the preamble hereto. 

         Person:    An individual, partnership, corporation, limited liability company, trust, unincorporated organization or other legal entity,
or a government
or agency or political subdivision thereof. 

         Prospectus:    The prospectus included in a Registration Statement, as amended or supplemented by any prospectus supplement and by all
other amendments
thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus. 

        Purchase Agreement:    As defined in the preamble hereto. 

         Registration Default:    As defined in Section 5 hereof. 

         Registration Statement:    Any registration statement of the Issuers relating to (a) an offering of Exchange Securities pursuant to
an Exchange
Offer or (b) the registration for resale of Transfer Restricted Securities pursuant to the Shelf Registration Statement, which is filed pursuant to the provisions of this Agreement, in each
case, including the Prospectus included therein, all amendments and supplements thereto (including post-effective amendments) and all exhibits and material incorporated by reference therein. 

2

 

         Securities:    The Initial Securities and the Exchange Securities. 

        Securities Act:    The Securities Act of 1933, as amended. 

         Shelf Filing Date:    As defined in Section 4(a) hereof. 

         Shelf Registration Statement:    As defined in Section 4(a) hereof. 

        Transfer Restricted Securities:    Each Initial Security, until the earliest to occur of (a) the date on which such Initial Security
is exchanged
in the Exchange Offer for an Exchange Security entitled to be resold to the public by the Holder thereof without complying with the prospectus delivery requirements of the Securities Act,
(b) the date on which such Initial Security has been effectively registered under the
Securities Act and disposed of in accordance with a Shelf Registration Statement, (c) the date on which such Initial Security is distributed to the public by a Broker-Dealer pursuant to the
"Plan of Distribution" contemplated by the Exchange Offer Registration Statement (including delivery of the Prospectus contained therein) and (d) the date on which such Initial Security ceases
to be outstanding. 

         Trust Indenture Act:    The Trust Indenture Act of 1939, as amended. 

         Underwritten Registration or Underwritten Offering:    A registration in which securities of the Issuers are sold to an underwriter for
reoffering to
the public. 

        SECTION 2.
Securities Subject to this Agreement. 

        (a)    Transfer Restricted Securities.    The securities entitled to the benefits of this Agreement are the Transfer
Restricted Securities. 

        (b)    Holders of Transfer Restricted Securities.    A Person is deemed to be a holder of Transfer Restricted
Securities (each, a "Holder") whenever such Person owns Transfer Restricted Securities. 

        SECTION 3.
Registered Exchange Offer. 

        (a)   Unless
the Exchange Offer shall not be permissible under applicable law or Commission policy (after the procedures set forth in  Section 6(a) hereof have been complied with), each of the Issuers shall
(i) cause to be filed with the Commission sufficiently promptly so
as to avoid a Registration Default with respect to the Exchange Offer, a Registration Statement under the Securities Act relating to the Exchange Securities and the Exchange Offer (the
"Exchange Offer Registration Statement"), (ii) use commercially reasonable efforts to cause such Exchange Offer Registration Statement to become
effective under the Securities Act sufficiently promptly so as to avoid a Registration Default with respect to the Exchange Offer, subject to the requirements of Section 3(b) hereof,
(iii) in connection with the foregoing, (A) file all pre-effective amendments to such Exchange Offer Registration Statement as may be necessary in order to cause such Exchange Offer
Registration Statement to become effective, (B) if applicable, file a post-effective amendment to such Exchange Offer Registration Statement pursuant to Rule 430A under the
Securities Act and (C) cause all necessary filings in connection with the registration and qualification of the Exchange Securities to be made under the state securities or blue sky laws of
such jurisdictions as are necessary to permit Consummation of the Exchange Offer, and (iv) upon the effectiveness of such Registration Statement commence the Exchange Offer. The Exchange Offer
shall be on the appropriate form permitting registration of the Exchange Securities to be offered in exchange for the Transfer Restricted Securities and to permit resales of Transfer Restricted
Securities held by Broker-Dealers as contemplated by Section 3(c) hereof. 

        (b)   The
Issuers shall cause the Exchange Offer Registration Statement to be effective continuously and shall keep the Exchange Offer open for a period of not less than the
minimum period required under applicable federal and state securities laws to Consummate the Exchange Offer; provided, however, that in no event shall
such period be less than 20 Business Days after the date notice 

3

 

of
the Exchange Offer is mailed to the Holders. The Issuers shall cause the Exchange Offer to comply with all applicable federal and state securities laws. No securities other than the Exchange
Securities shall be included in the Exchange Offer Registration Statement. The Issuers shall use commercially reasonable efforts to cause the Exchange Offer to be Consummated on the earliest
practicable date after the Exchange Offer Registration Statement has become effective, but in no event later than 270 days after the Closing Date (or if such 270th day is not a Business
Day, the next succeeding Business Day) (such 270th day herein referred to as the "Exchange Deadline"). 

        (c)   The
Issuers shall indicate in a "Plan of Distribution" section contained in the Prospectus forming a part of the Exchange Offer Registration Statement that any
Broker-Dealer who holds Initial Securities that are Transfer Restricted Securities and that were acquired for its own account as a result of market-making activities or other trading activities (other
than Transfer Restricted Securities acquired directly from the Issuers), may exchange such Initial Securities pursuant to the Exchange Offer; however, such Broker-Dealer may be deemed to be an
"underwriter" within the meaning of the Securities Act and must, therefore, deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of the Exchange
Securities received by such Broker-Dealer in the Exchange Offer, which prospectus delivery requirement may be satisfied by the delivery by such Broker-Dealer of the Prospectus contained in the
Exchange Offer Registration Statement. Such "Plan of Distribution" section shall also contain all other information with respect to such resales by Broker-Dealers that the Commission may require in
order to permit such resales pursuant thereto, but such "Plan of Distribution" shall not name any such Broker-Dealer or disclose the amount of Initial Securities held by any such Broker-Dealer except
to the extent required by the Commission as a result of a change in policy after the date of this Agreement. 

        Each
of the Issuers shall use commercially reasonable efforts to keep the Exchange Offer Registration Statement continuously effective, supplemented and amended as required by the
provisions of Section 6(c) hereof to the extent necessary to ensure that it is available for resales of Transfer Restricted Securities acquired
by Broker-Dealers for their own accounts as a result of market-making activities or other trading activities, and to ensure that it conforms with the requirements of this Agreement, the Securities Act
and the policies, rules and regulations of the Commission as announced from time to time, for a period ending on the earlier of (i) 180 days from the date on which the Exchange Offer
Registration Statement is declared effective and (ii) the date on which a Broker-Dealer is no longer required to deliver a prospectus in connection with market-making or other trading
activities. 

        The
Issuers shall provide sufficient copies of the latest version of such Prospectus to Broker-Dealers promptly upon request at any time during such 180-day (or shorter as provided in
the foregoing sentence) period in order to facilitate such resales. 

        SECTION 4.
Shelf Registration. 

        (a)    Shelf Registration.    If (i) the Issuers are not required to file an Exchange Offer Registration
Statement or to consummate the Exchange Offer for the Initial Securities because the Exchange Offer is not permitted by applicable law or Commission policy (after the procedures set forth in  Section 6(a) hereof have been complied with), (ii) for any reason the Exchange Offer is not Consummated by the Exchange Deadline, or
(iii) with respect to any Holder of Transfer Restricted Securities (A) such Holder is prohibited by applicable law or Commission policy from participating in the Exchange Offer, or
(B) such Holder may not resell the Exchange Securities acquired by it in the Exchange Offer to the public without delivering a prospectus and the Prospectus contained in the Exchange Offer
Registration Statement is not appropriate or available for such resales by such Holder, or (C) such Holder is a Broker-Dealer and holds Initial Securities acquired directly from the Issuers or
one of their affiliates, then, upon such Holder's request, the Issuers shall: 

4

 

          (i)  cause
to be filed a shelf registration statement pursuant to Rule 415 under the Securities Act, which may be an amendment to the Exchange Offer Registration
Statement (in either event, the "Shelf Registration Statement") as soon as practicable but in any event on or prior to 30 days after the date
such obligation arises (or if such 30th day is not a Business Day, the next succeeding Business Day), which Shelf Registration Statement shall provide for resales of all Transfer Restricted
Securities the Holders of which shall have provided the information required pursuant to Section 4(b) hereof; and 

         (ii)  use
their commercially reasonable efforts to cause such Shelf Registration Statement to be declared effective by the Commission on or before the 90th day after
the Shelf Registration Statement has been filed with the Commission (the "Shelf Filing Date") (or if such 90th day is not a Business Day, the
next succeeding Business Day). 

        Each
Issuer shall use commercially reasonable efforts to keep such Shelf Registration Statement continuously effective, supplemented and amended as required by the provisions of  Sections 6(b) and
(c) hereof to the extent necessary to ensure that it is available for
resales of Initial Securities by the Holders of Transfer Restricted Securities entitled to the benefit of this Section 4(a), and to ensure that
it conforms with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, for a period of at least one year
following the effective date of such Shelf Registration Statement (or shorter period that will terminate when all the Initial Securities covered by such Shelf Registration Statement have been sold
pursuant to such Shelf Registration Statement). 

        (b)    Provision by Holders of Certain Information in Connection with the Shelf Registration Statement.    No Holder
of Transfer Restricted Securities may include any of its Transfer Restricted Securities in any Shelf Registration Statement pursuant to this Agreement unless and until such Holder furnishes to the
Issuers in writing, within 20 Business Days after receipt of a request therefor, such information as the Issuers may reasonably request for use in connection with any Shelf Registration Statement or
Prospectus or preliminary Prospectus included therein. Each Holder as to which any Shelf Registration Statement is being effected agrees to furnish promptly to the Issuers all information required to
be disclosed in order to make the information previously furnished to the Issuers by such Holder not materially misleading. 

        SECTION 5.
Additional Interest. If (a) the Exchange Offer is not Consummated on or prior to the Exchange Deadline,
(b) a Shelf Registration Statement applicable to the Transfer Restricted Securities required to be filed by the terms of this Agreement is not declared effective (or does not automatically
become effective) on or prior to the 90th calendar day following any Shelf Filing Date (or if such 90th day is not a Business Day, the next succeeding Business Day), or (c) a
Shelf Registration Statement applicable to the Transfer Restricted Securities required to be filed by the terms of this Agreement is
declared effective (or automatically becomes effective) as required but thereafter fails to remain effective or becomes unusable in connection with resales for more than 30 calendar days (each such
event referred to in clauses (a) through (c) above, a "Registration Default"), the Issuers hereby agree that the interest rate borne by
the Transfer Restricted Securities shall be increased by 1.0% per annum payable in cash ("Additional Interest") for the period of occurrence of the
Registration Default until the earlier of the consummation of the Exchange Offer and such time as no Registration Default is in effect. Following the cure of all Registration Defaults, Additional
Interest will cease to accrue and the interest rate on the Transfer Restricted Securities will revert to the original rate; provided,  however, that, if
after the date such Additional Interest ceases to accrue, another Registration Default occurs, Additional Interest will again commence
accruing pursuant to the foregoing provisions. Additional Interest will be paid as provided in the Indenture. 

        All
obligations of the Issuers set forth in the preceding paragraph that are outstanding with respect to any Transfer Restricted Security at the time such security ceases to be a
Transfer Restricted Security 

5

 

shall
survive until such time as all such obligations with respect to such security shall have been satisfied in full. 

        SECTION 6.
Registration Procedures. 

        (a)    Exchange Offer Registration Statement.    In connection with the Exchange Offer, the Issuers shall comply with
all of the provisions of Section 6(c) hereof, shall use their commercially reasonable efforts to effect such exchange to permit the sale of
Transfer Restricted Securities being sold in accordance with the intended method or methods of distribution thereof, and shall comply with all of the following provisions: 

          (i)  If
in the reasonable opinion of counsel to the Issuers there is a question as to whether the Exchange Offer is permitted by applicable law, each of the Issuers hereby
agrees to seek a no-action letter or other favorable decision from the Commission allowing the Issuers to Consummate an Exchange Offer for such Initial Securities. Each of the Issuers hereby agrees to
pursue the issuance of such a decision to the Commission staff level but shall not be required to take commercially unreasonable action to effect a change of Commission policy. Each of the Issuers
hereby agrees, however, to (A) participate in telephonic conferences with the Commission, (B) deliver to the Commission staff an analysis prepared by counsel to the Issuers setting forth
the legal bases, if any, upon which such counsel has concluded that such an Exchange Offer should be permitted and (C) diligently pursue a favorable resolution by the Commission staff of such
submission. 

         (ii)  As
a condition to its participation in the Exchange Offer pursuant to the terms of this Agreement, each Holder of Transfer Restricted Securities shall furnish, upon the
request of the Issuers, prior to the Consummation thereof, a written representation to the Issuers (which may be contained in the letter of transmittal contemplated by the Exchange Offer Registration
Statement) to the effect that (A) it is not an affiliate of either Issuer, (B) it is not engaged in, and does not intend to engage in, and has no arrangement or understanding with any
Person to participate in, a distribution of the Exchange Securities to be issued in the Exchange Offer and (C) it is acquiring the Exchange Securities in its ordinary course of business. In
addition, all such Holders of Transfer Restricted Securities shall otherwise cooperate in the Issuers' preparations for the Exchange Offer. Each Holder hereby acknowledges and agrees that any
Broker-Dealer and any such Holder using the Exchange Offer to participate in a distribution of the securities to be acquired in the Exchange Offer (1) could not under Commission policy as in
effect on the date of this Agreement rely on the position of the Commission enunciated in Morgan Stanley and Co., Inc. (available
June 5, 1991) and Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in the Commission's letter to
Shearman & Sterling dated July 2, 1993, and similar no-action letters (which may include any no-action letter obtained pursuant to clause (i) above), and (2) must comply
with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction and that such a secondary resale transaction should be covered by an
effective registration statement containing the selling security holder information required by Item 507 or 508, as applicable, of Regulation S-K if the resales are of Exchange
Securities obtained by such Holder in exchange for Initial Securities acquired by such Holder directly from the Issuers. 

        (b)    Shelf Registration Statement.    In connection with the Shelf Registration Statement, each of the Issuers shall
comply with all the provisions of Section 6(c) hereof and shall use commercially reasonable efforts to effect such registration to permit the
sale of the Transfer Restricted Securities being sold in accordance with the intended method or methods of distribution thereof, and pursuant thereto each of the Issuers will as expeditiously as
possible prepare and file with the Commission a Registration Statement relating to the registration on any appropriate form under the Securities Act, which form 

6

 

shall
be available for the sale of the Transfer Restricted Securities in accordance with the intended method or methods of distribution thereof. 

        (c)    General Provisions.    In connection with any Registration Statement and any Prospectus required by this
Agreement to permit the sale or resale of Transfer Restricted Securities (including, without limitation, any Registration Statement and the related Prospectus required to permit resales of Initial
Securities by Broker-Dealers), each of the Issuers shall: 

          (i)  use
commercially reasonable efforts to keep such Registration Statement continuously effective and provide all requisite financial statements (including, if required by
the Securities Act or any regulation
thereunder, financial statements of Midstates Sub or any Guarantor) for the period specified in Section 3 or 4 hereof, as applicable; upon the
occurrence of any event that would cause any such Registration Statement or the Prospectus contained therein (A) to contain a material misstatement or omission or (B) not to be effective
and usable for resale of Transfer Restricted Securities during the period required by this Agreement, the Issuers shall file promptly an appropriate amendment to such Registration Statement, in the
case of clause (A), correcting any such misstatement or omission, and, in the case of either clause (A) or (B), use commercially reasonable efforts to cause such amendment to be declared
effective and such Registration Statement and the related Prospectus to become usable for their intended purpose(s) as soon as practicable thereafter; 

         (ii)  prepare
and file with the Commission such amendments and post-effective amendments to the applicable Registration Statement as may be necessary to keep the Registration
Statement effective for the applicable period set forth in Section 3 or 4 hereof, as applicable, or such shorter period as will terminate when
all Transfer Restricted Securities covered by such Registration Statement have been sold; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 under the Securities Act, and to comply fully with the applicable provisions of Rules 424 and 430A under the Securities Act in a timely manner; and comply with
the provisions of the Securities Act with respect to the disposition of all securities covered by such Registration Statement during the applicable period in accordance with the intended method or
methods of distribution by the sellers thereof set forth in such Registration Statement or supplement to the Prospectus; 

        (iii)  advise
the underwriters, if any, and selling Holders promptly and, if requested by such Persons, to confirm such advice in writing, (A) when the Prospectus or
any Prospectus supplement or post-effective amendment has been filed, and, with respect to any Registration Statement or any post-effective amendment thereto, when the same has become effective,
(B) of any request by the Commission for amendments to the Registration Statement or amendments or supplements to the Prospectus or for additional information relating thereto, (C) of
the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement under the Securities Act or of the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for offering or sale in any jurisdiction, or the initiation of any proceeding for any of the preceding purposes, (D) of the existence of any
fact or the happening of any event that makes any statement of a material fact made in the Registration Statement, the Prospectus, any amendment or supplement thereto, or any document incorporated by
reference therein untrue, or that requires the making of any additions to or changes in the Registration Statement or the Prospectus in order to make the statements therein (with respect to the
Prospectus or any supplement thereto, in light of the circumstances under which they were made) not misleading. If at any time the Commission shall issue any stop order suspending the effectiveness of
the Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Transfer
Restricted Securities under state securities or blue sky laws, each of the Issuers shall use commercially reasonable efforts to obtain the withdrawal or lifting of such order at the earliest possible
time; 

7

 

        (iv)  furnish
without charge to the Initial Purchaser, each selling Holder named in any Registration Statement, each of the underwriters, if any, before filing with the
Commission, copies of any Registration Statement or any Prospectus included therein or any amendments or supplements to any such Registration Statement or Prospectus (including all documents
incorporated by reference after the initial filing of such Registration Statement), which documents will be subject to the review and comment of such Holders and underwriters in connection with such
sale, if any, for a period of at least five Business Days, and the Issuers will not file any such Registration Statement or Prospectus or any amendment or supplement to any such Registration Statement
or Prospectus (including all such documents incorporated by reference) to which an Initial Purchaser of Transfer Restricted Securities covered by such Registration Statement or the underwriters, if
any, shall reasonably object in writing within five Business Days after the receipt thereof (such objection to be deemed timely made upon confirmation of telecopy transmission within such period). The
objection of an Initial Purchaser or underwriter, if any, shall be deemed to be reasonable if such Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed,
contains a material misstatement or omission; 

         (v)  promptly
prior to the filing of any document that is to be incorporated by reference into a Registration Statement or Prospectus, provide copies of such document to the
Initial Purchaser, each selling Holder named in any Registration Statement, and to the underwriters, if any, make the Issuers' representatives available for discussion of such document and other
customary due diligence matters, and include such information in such document prior to the filing thereof as such selling Holders or underwriters, if any, reasonably may request; 

        (vi)  make
available at reasonable times for inspection by the Initial Purchaser, the managing underwriters, if any, participating in any disposition pursuant to such
Registration Statement and any attorney or accountant retained by the Initial Purchaser or any of the underwriters, all financial and other records, pertinent corporate documents and properties of
each of the Issuers and cause the Issuers' officers, directors and employees to supply all information reasonably requested by any such Holder, underwriter, attorney or accountant in connection with
such Registration Statement or any post-effective amendment thereto subsequent to the filing thereof and prior to its effectiveness and to participate in meetings with investors to the extent
requested by the managing underwriters, if any; 

       (vii)  if
requested by any selling Holders or the underwriters, if any, promptly incorporate in any Registration Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as such selling Holders and underwriters, if any, may reasonably request to have included therein, including, without limitation, information
relating to the "Plan of Distribution" of the Transfer Restricted Securities, information with respect to the principal amount of Transfer Restricted Securities being sold to such underwriters, the
purchase price being paid therefor and any other terms of the offering of the Transfer Restricted Securities to be sold in such offering; and make all required filings of such Prospectus supplement or
post-effective amendment as soon as practicable after the Issuers are notified of the matters to be incorporated in such Prospectus supplement or post-effective amendment; 

      (viii)  cause
the Transfer Restricted Securities covered by the Registration Statement to be rated with the appropriate rating agencies, if so requested by the Holders of a
majority in aggregate principal amount of Securities covered thereby or the underwriters, if any; 

        (ix)  furnish
to the Initial Purchaser, each selling Holder and each of the underwriters, if any, without charge, at least one copy of the Registration Statement, as first
filed with the Commission, and of each amendment thereto, including financial statements and schedules, all documents incorporated by reference therein and all exhibits (including exhibits
incorporated therein by reference); 

8

 

         (x)  deliver
to each selling Holder and each of the underwriters, if any, without charge, as many copies of the Prospectus (including each preliminary prospectus) and any
amendment or supplement thereto as such Persons reasonably may request; each of the Issuers hereby consents to the use of the Prospectus and any amendment or supplement thereto by each of the selling
Holders and each of the underwriters, if any, in connection with the offering and the sale of the Transfer Restricted Securities covered by the Prospectus or any amendment or supplement thereto; 

        (xi)  enter
into such agreements (including an underwriting agreement), and make such representations and warranties, and take all such other actions in connection therewith
in order to expedite or facilitate the disposition of the Transfer Restricted Securities pursuant to any Registration Statement contemplated by this Agreement, all to such extent as may be requested
by the Initial Purchaser or by any Holder of Transfer Restricted Securities or underwriter in connection with any sale or resale pursuant to any Registration Statement contemplated by this Agreement;
and whether or not an underwriting agreement is entered into and whether or not the registration is an Underwritten Registration, each of the Issuers shall: 

        (A)  furnish
to the Initial Purchaser, each selling Holder and each underwriter, if any, in such substance and scope as they may request and as are customarily made by
issuers to underwriters in primary underwritten offerings, upon the date of the Consummation of the Exchange Offer or, if applicable, of the effectiveness of the Shelf Registration Statement: 

        (1)   a
certificate, dated the date of Consummation of the Exchange Offer or the date of effectiveness of the Shelf Registration Statement, as the case may be, signed by
(y) the Chairman of the Board, Chief Executive Officer or President and (z) the Chief Financial Officer or Chief Accounting Officer of each of the Issuers, confirming, as of the date
thereof, the matters set forth in Sections 5(c)(ii) and 5(f) of the Purchase Agreement and such other matters as such parties may reasonably request; 

        (2)   an
opinion, dated the date of Consummation of the Exchange Offer or the date of effectiveness of the Shelf Registration Statement, as the case may be, of counsel for the
Issuers, covering the matters set forth in Section 5(d) of the Purchase Agreement and such other matter as such parties may reasonably request, and in any event including a statement to the
effect that such counsel has participated in conferences with officers and other representatives of the Issuers, representatives of the independent public accountants for the Company, representatives
of the underwriters, if any, and counsel to the underwriters, if any, in connection with the preparation of such Registration Statement and the related Prospectus and have considered the matters
required to be stated therein and the statements contained therein, although such counsel has not independently verified the accuracy, completeness or fairness of such statements; and that such
counsel advises that, on the basis of the foregoing, no facts came to such counsel's attention that caused such counsel to believe that the applicable Registration Statement, at the time such
Registration Statement or any post-effective amendment thereto became effective, and, in the case of the Exchange Offer Registration Statement, as of the date of Consummation, contained an untrue
statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Prospectus contained in such
Registration Statement as of its date and, in the case of the opinion dated the date of Consummation of the Exchange Offer, as of the date of Consummation, contained an untrue statement of a material
fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Without limiting the foregoing,
such counsel may state further that such counsel assumes no responsibility for, and has not independently verified, the accuracy, completeness or fairness of the financial statements, notes and
schedules and other financial, accounting and reserve data 

9

 

included
in any Registration Statement contemplated by this Agreement or the related Prospectus; and 

        (3)   a
customary comfort letter, dated the date of effectiveness of the Shelf Registration Statement, from the Company's independent accountants and any other independent
accountants who have certified audited financial statements contained in or incorporated by reference into the Registration Statement, in the customary form and covering matters of the type
customarily requested to be covered in comfort letters by underwriters in connection with primary underwritten offerings, and covering or affirming the matters set forth in the comfort letters
delivered pursuant to Section 5(a) of the Purchase Agreement, without exception; 

        (B)  set
forth in full or incorporate by reference in the underwriting agreement, if any, the indemnification provisions and procedures of  Section 8 hereof with respect to all parties to be indemnified
pursuant to said Section; and 

        (C)  deliver
such other documents and certificates as may be reasonably requested by such parties to evidence compliance with  Section 6(c)(xi)(A) hereof and with any customary conditions contained in the
underwriting agreement or other agreement entered into by the
Issuers pursuant to this Section 6(c)(xi), if any. 

        If
at any time the representations and warranties of the Issuers set forth in Section 6(c)(xi)(A)(1) hereof cease to be true and
correct, the Issuers shall so advise the Initial Purchaser and the underwriters, if any, and each selling Holder promptly and, if requested by such Persons, shall confirm such advice in writing; 

       (xii)  prior
to any public offering of Transfer Restricted Securities, cooperate with the selling Holders, the underwriters, if any, and their respective counsel in
connection with the registration and qualification of the Transfer Restricted Securities under the state securities or blue sky laws of such jurisdictions as the selling Holders or underwriters, if
any, may request and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Transfer Restricted Securities covered by the Shelf Registration
Statement; provided, however, that neither Issuers shall be required to register or qualify as a foreign corporation where it is not then so qualified
or to take any action that would subject it to the service of process in suits or to taxation, other than as to matters and transactions relating to the Registration Statement, in any jurisdiction
where it is not then so subject; 

      (xiii)  shall
issue, upon the request of any Holder of Initial Securities covered by the Exchange Offer Registration Statement, Exchange Securities having an aggregate
principal amount equal to the aggregate principal amount of Initial Securities surrendered to the Issuers by such Holder in exchange therefor or being sold by such Holder; such Exchange Securities, in
certificated form, to be registered in the name of such Holder or in the name of the purchasers of such Securities, as the case may be; in return, the Initial Securities held by such Holder shall be
surrendered to the Issuers for cancellation; 

      (xiv)  cooperate
with the selling Holders and the underwriters, if any, to facilitate the timely preparation and delivery of certificates representing Transfer Restricted
Securities to be sold and not bearing any restrictive legends; and enable such Transfer Restricted Securities to be in such denominations and registered in such names as the Holders or the
underwriters, if any, may request at least two Business Days prior to any sale of Transfer Restricted Securities made by such Holders or underwriters; 

       (xv)  use
commercially reasonable efforts to cause the Transfer Restricted Securities covered by the Registration Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the seller or sellers thereof or the underwriters, if 

10

 

any,
to consummate the disposition of such Transfer Restricted Securities, subject to the proviso contained in Section 6(c)(xii) hereof; 

      (xvi)  if
any fact or event contemplated by Section 6(c)(iii)(D) hereof shall exist or have occurred, prepare a
supplement or post-effective amendment to the Registration Statement or related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter
delivered to the purchasers of Transfer Restricted Securities, the Prospectus will not contain an untrue statement of a material fact or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made, not misleading; 

     (xvii)  provide
a CUSIP number for all Exchange Securities not later than the effective date of the Registration Statement covering such Exchange Securities and provide the
Trustee under the Indenture with printed certificates for such Exchange Securities which are in a form eligible for deposit with the Depository Trust Company and take all other action necessary to
ensure that all such Exchange Securities are eligible for deposit with the Depository Trust Company; 

    (xviii)  cooperate
and assist in any filings required to be made with FINRA and in the performance of any due diligence investigation by any underwriter (including any
"qualified independent underwriter" as that term is defined within the rules and regulations of FINRA) that is required to be retained in accordance with the rules and regulations of FINRA; 

      (xix)  otherwise
use commercially reasonable efforts to comply with all applicable rules and regulations of the Commission, and make generally available to its security
holders, as soon as practicable, a consolidated earnings statement meeting the requirements of Rule 158 under the Securities Act (which need not be audited) for the twelve-month period
(A) commencing at the end of any fiscal quarter in which Transfer Restricted Securities are sold to underwriters in a firm commitment or best efforts Underwritten Offering or (B) if not
sold to underwriters in such an offering, beginning with the first month of the Company's first fiscal quarter commencing after the effective date of the Registration Statement; 

       (xx)  cause
the Indenture to be qualified under the Trust Indenture Act not later than the effective date of the first Registration Statement required by this Agreement, and,
in connection therewith, cooperate with the Trustee and the Holders of Securities to effect such changes to the Indenture as may be required for such Indenture to be so qualified in accordance with
the terms of the Trust Indenture Act; and to execute and use commercially reasonable efforts to cause the Trustee to execute, all documents
that may be required to effect such changes and all other forms and documents required to be filed with the Commission to enable such Indenture to be so qualified in a timely manner; and 

      (xxi)  if
not publicly available on EDGAR, provide promptly to each Holder upon reasonable request each document filed with the Commission pursuant to the requirements of
Section 13 and Section 15 of the Exchange Act. 

        Each
Holder agrees by acquisition of a Transfer Restricted Security that, upon receipt of any notice from the Issuers of the existence of any fact of the kind described in  Section 6(c)(iii)(D) hereof,
such Holder will forthwith discontinue disposition of Transfer Restricted Securities pursuant to the applicable
Registration Statement until such Holder's receipt of the copies of the supplemented or amended Prospectus contemplated by Section 6(c)(xvi)
hereof, or until it is advised in writing ("the Advice") by the Issuers that the use of the Prospectus may be resumed, and has received copies of any
additional or supplemental filings that are incorporated by reference in the Prospectus. If so directed by the Issuers, each Holder will deliver to the Issuers (at the Issuers' expense) all copies,
other than permanent file copies then in such Holder's possession, of the Prospectus covering such Transfer Restricted Securities that was current at the time of receipt of such notice. In the event
the Issuers 

11

 

shall
give any such notice, the time period regarding the effectiveness of such Registration Statement set forth in Section 3 or 4 hereof, as applicable, shall be extended by the number of days
during the period from and including the date of the giving of such notice pursuant to Section 6(c)(iii)(D) hereof to and including the date when
each selling Holder covered by such Registration Statement shall have received the copies of the supplemented or amended Prospectus contemplated by  Section 6(c)(xvi) hereof or shall have received
the Advice; provided, however, that no such
extension shall be taken into account in determining whether Additional Interest is due pursuant to Section 5 hereof or the amount of such Additional Interest, it being agreed that the Issuers'
option to suspend use of a Registration Statement pursuant to this paragraph shall be treated as a Registration Default for purposes of Section 5
hereof. 

        SECTION 7.
Registration Expenses. 

        (a)   All
expenses incident to the Issuers' performance of or compliance with this Agreement will be borne by the Issuers, jointly and severally, regardless of whether a
Registration Statement becomes effective, including, without limitation: (i) all registration and filing fees and expenses (including filings made by the Initial Purchaser or any Holder with
FINRA (and, if applicable, the fees and expenses of any "qualified independent underwriter" and its counsel that may be required by the rules and regulations of FINRA)); (ii) all fees and
expenses of compliance with federal securities and state securities or blue sky laws; (iii) all expenses of printing (including printing certificates for the Exchange Securities to be issued in
the Exchange Offer and printing of Prospectuses), messenger and delivery services and telephone; (iv) all fees and disbursements of counsel for the Issuers and, subject to  Section 7(b) hereof,
the Holders of Transfer Restricted Securities; (v) all application and filing fees in connection with listing the
Exchange Securities on a securities exchange or automated quotation system pursuant to the requirements thereof; and (vi) all fees and disbursements of independent certified public accountants
of the Company (including the expenses of any special audit and comfort letters required by or incident to such performance). 

        Each
of the Issuers will, in any event, bear its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting
duties), the expenses of any annual audit and the fees and expenses of any Person, including special experts, retained by either Issuer. 

        (b)   In
connection with any Registration Statement required by this Agreement (including, without limitation, the Exchange Offer Registration Statement and the Shelf
Registration Statement), the Issuers, jointly and severally, will reimburse the Initial Purchaser and the Holders of Transfer Restricted Securities being tendered in the Exchange Offer and/or resold
pursuant to the "Plan of Distribution" contained in the Exchange Offer Registration Statement or registered pursuant to the Shelf Registration Statement, as applicable, for the reasonable fees and
disbursements of not more than one counsel, who shall be Milbank, Tweed, Hadley & McCloy LLP or such other counsel as may be chosen by the Holders of a majority in principal amount of
the Transfer Restricted Securities for whose benefit such Registration Statement is being prepared. 

        SECTION 8.
Indemnification. 

        (a)   The
Issuers, jointly and severally, agree to indemnify and hold harmless (i) each Holder and (ii) each Person, if any, who controls (within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act) any Holder (any of the Persons referred to in this clause (ii) being hereinafter referred to as a "controlling
person") and (iii) the respective officers, directors, partners, employees, representatives and agents of any Holder or any controlling person (any Person referred to in clause (i),
(ii) or (iii) may hereinafter be referred to as an "Indemnified Holder"), to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments,
actions and expenses (including, without limitation, and as incurred, reimbursement of all reasonable costs of investigating, preparing, pursuing, settling, compromising, paying or defending any claim
or action, or 

12

 

any
investigation or proceeding by any governmental agency or body, commenced or threatened, including the reasonable fees and expenses of counsel to any Indemnified Holder), joint or several,
directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue statement or alleged untrue statement of a material fact contained in any Registration
Statement or Prospectus (or any amendment or supplement thereto), or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages, liabilities or expenses are caused by an untrue statement or omission or alleged untrue statement or omission that is made in
reliance upon and in conformity with information relating to any of the Holders furnished in writing to the Issuers by any of the Holders expressly for use therein. This indemnity agreement shall be
in addition to any liability which the Issuers may otherwise have. 

        In
case any action or proceeding (including any governmental or regulatory investigation or proceeding) shall be brought or asserted against any of the Indemnified Holders with respect
to which indemnity may be sought against either Issuer, such Indemnified Holder (or the Indemnified Holder controlled by such controlling person) shall promptly notify the Issuers in writing;  provided, however, that the failure to give such notice shall not relieve either Issuer of its obligations pursuant to this Agreement. Such Indemnified
Holder shall have the right to employ its own counsel in any such action and the fees and expenses of such counsel shall be paid, as incurred, by the Issuers (regardless of whether it is ultimately
determined that an Indemnified Holder is not entitled to indemnification hereunder). The Issuers shall not, in connection with any one such action or proceeding or separate but substantially similar
or related actions or proceedings in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm
of attorneys (in addition to any local counsel) at any time for such Indemnified Holders, which firm shall be designated by the Holders. The Issuers shall be liable for any settlement of any such
action or proceeding effected with the Issuers' prior written consent, which consent shall not be withheld unreasonably, and each of the Issuers agrees to indemnify and hold harmless any Indemnified
Holder from and against any loss, claim, damage, liability or expense by reason of any settlement of any action effected with the written consent of the Issuers. The Issuers shall not, without the
prior written consent of each Indemnified Holder, settle or compromise or consent to the entry of judgment in or otherwise seek to terminate any pending or threatened action, claim, litigation or
proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not any Indemnified Holder is a party thereto), unless such settlement, compromise, consent or
termination includes an unconditional release of each Indemnified Holder from all liability arising out of such action, claim, litigation or proceeding. 

        (b)   Each
Holder of Transfer Restricted Securities agrees, severally and not jointly, to indemnify and hold harmless the Issuers and their respective directors, officers,
partners, employees, representatives and agents of the Issuers who sign a Registration Statement, and any Person controlling (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) either Issuer, and the respective officers, directors, partners, employees, representatives and agents of each such Person, to the same extent as the foregoing
indemnity from the Issuers to each of the Indemnified Holders, but only with respect to claims and actions based on information relating to such Holder furnished in writing by such Holder expressly
for use in any Registration Statement. In case any action or proceeding shall be brought against either Issuer or their respective directors or officers or any such controlling person in respect of
which indemnity may be sought against a Holder of Transfer Restricted Securities, such Holder shall have the rights and duties given the Issuers, and the Issuers, their respective directors, officers,
partners, employees, representatives and agents and such controlling person shall have the rights and duties given to each Holder by the preceding paragraph. 

        (c)   If
the indemnification provided for in this Section 8 is unavailable to an indemnified party under  Section 8(a) or (b)
 hereof (other than by reason of exceptions provided in those Sections)
in 

13

 

respect
of any losses, claims, damages, liabilities, judgments, actions or expenses referred to therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative
benefits received by the Issuers, on the one hand, and the Holders, on the other hand, from the Initial Placement (which in the case of the Issuers shall be deemed to be equal to the total gross
proceeds to the Issuers from the Initial Placement), the amount of Additional Interest which did not become payable as a result of the filing of the Registration Statement resulting in such losses,
claims, damages, liabilities, judgments actions or expenses, and such Registration Statement, or if such allocation is not permitted by applicable law, the relative fault of the Issuers, on the one
hand, and the Holders, on the other hand, in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative fault of the Issuers, on the one hand, and of the Indemnified Holder, on the other, shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by either Issuer, on the one hand, or the Indemnified
Holders, on the other hand, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party
as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of  Section 8(a)
hereof, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any
action or claim. 

        Each
Issuer and each Holder of Transfer Restricted Securities agree that it would not be just and equitable if contribution pursuant to this  Section 8(c) were determined by pro rata allocation (even if
the Holders were treated as one entity for such purpose) or by any other method of
allocation which
does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages,
liabilities or expenses referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8,
none of the Holders (and its related Indemnified Holders) shall be required to contribute, in the aggregate, any amount in excess of the amount by which the total discount received by such Holder with
respect to the Initial Securities exceeds the amount of any damages which such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of
such fraudulent misrepresentation. The Holders' obligations to contribute pursuant to this Section 8(c) are several in proportion to the
respective principal amount of Initial Securities held by each of the Holders hereunder and not joint. 

        SECTION 9.
Rule 144A. Each of the Issuers hereby agrees with each Holder, for so long as any Transfer Restricted Securities
remain outstanding, to make available to any Holder or beneficial owner of Transfer Restricted Securities in connection with any sale thereof and any prospective purchaser of such Transfer Restricted
Securities from such Holder or beneficial owner, the information required by Rule 144A(d)(4) under the Securities Act in order to permit resales of such Transfer Restricted Securities pursuant
to Rule 144A under the Securities Act. 

        SECTION 10.
Participation in Underwritten Registrations. No Holder may participate in any Underwritten Registration hereunder
unless such Holder (a) agrees to sell such Holders' Transfer Restricted Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (b) completes and executes all reasonable 

14

 

questionnaires,
powers of attorney, indemnities, underwriting agreements, lock-up letters and other documents required under the terms of such underwriting arrangements. 

        SECTION 11.
Selection of Underwriters. The Holders of Transfer Restricted Securities covered by the Shelf Registration Statement
who desire to do so may sell such Transfer Restricted Securities in an Underwritten Offering. In any such Underwritten Offering, the investment bankers and managing underwriters that will administer
such offering will be selected by the Holders of a majority in aggregate principal amount of the Transfer Restricted Securities included in such offering; provided, however, that such investment
bankers and managing underwriters must be reasonably satisfactory to the Issuers. 

        SECTION 12.
Miscellaneous. 

        (a)    Remedies.    Each of the Issuers hereby agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agree to waive the defense in any action for specific performance that a remedy at law would be adequate. 

        (b)    No Inconsistent Agreements.    Each of the Issuers will not on or after the date of this Agreement enter into
any agreement with respect to its securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. Neither Issuer has
previously entered into any agreement granting any registration rights with respect to its securities to any Person. The rights granted to the Holders hereunder do not in any way conflict with and are
not inconsistent with the rights granted to the holders of either Issuer's securities under any agreement in effect on the date hereof. 

        (c)    Adjustments Affecting the Securities.    The Issuers will not take any action, or permit any change to occur,
with respect to the Securities that would materially and adversely affect the ability of the Holders to Consummate any Exchange Offer. 

        (d)    Amendments and Waivers.    The provisions of this Agreement may not be amended, modified or supplemented, and
waivers or consents to or departures from the provisions hereof may not be given unless the Issuers have (i) in the case of Section 5
hereof and this Section 12(d)(i), obtained the written consent of Holders of all outstanding Transfer Restricted Securities and (ii) in
the case of all other provisions hereof, obtained the written consent of Holders of a majority of the outstanding principal amount of Transfer Restricted Securities (excluding any Transfer Restricted
Securities held by either Issuer or its Affiliates). Notwithstanding the foregoing, a waiver or consent to departure from the provisions hereof that relates exclusively to the rights of Holders whose
securities are being tendered pursuant to the Exchange Offer and that does not affect directly or indirectly the rights of other Holders whose securities are not being tendered pursuant to such
Exchange Offer may be given by the Holders of a majority of the outstanding principal amount of Transfer Restricted Securities being tendered or registered; provided,
however, that, with respect to any matter that directly or indirectly affects the rights of the Initial Purchaser hereunder, the Issuers shall obtain the written consent of the
Initial Purchaser with respect to which such amendment, qualification, supplement, waiver, consent or departure is to be effective. 

        (e)    Notices.    All notices and other communications provided for or permitted hereunder shall be made in writing
by hand-delivery, first-class mail (registered or certified, return receipt requested), telex, telecopier, or air courier guaranteeing overnight delivery: 

          (i)  if
to a Holder, at the address set forth on the records of the Registrar under the Indenture, with a copy to the Registrar under the Indenture; and 

15

 

if
to the Issuers: 

Midstates
Petroleum Company, Inc.

321 South Boston, Suite 1000

Tulsa, Oklahoma 74103

Facsimile: (918) 974-8550

Attention: Nelson Haight 

        All
such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if telecopied; and on the next Business Day, if timely delivered to an air courier guaranteeing overnight
delivery. 

        Copies
of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee at the address specified in the Indenture. 

        (f)    Successors and Assigns.    This Agreement shall inure to the benefit of and be binding upon the successors and
assigns of each of the parties, including, without limitation, and without the need for an express assignment, subsequent Holders of Transfer Restricted Securities; provided,
however, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign acquired
Transfer Restricted Securities from such Holder. 

        (g)    Counterparts.    This Agreement may be executed in any number of counterparts and by the parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. 

        (h)    Headings.    The headings in this Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning hereof. 

        (i)    Governing Law.    THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK. 

        (j)    Severability.    In the event that any one or more of the provisions contained herein, or the application
thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby. 

        (k)    Entire Agreement.    This Agreement is intended by the parties as a final expression of their agreement and
intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein with respect to the registration rights granted by the Issuers with respect to the Transfer Restricted Securities. This
Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter. 

16

QuickLinks

Exhibit 4.2

FORM OF REGISTRATION RIGHTS AGREEMENT

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