EX-4.42 12 v403466_ex4-42.htm EXHIBIT 4.42

 

Exhibit 4.42

 

EQUITY OPTION AGREEMENT

 

This Equity Option Agreement (this “Agreement”) is entered in Beijing, the People’s Republic of China (“PRC”, excluding the Hong Kong Special Administrative Region, the Macao Special Administrative Region and Taiwan, for the purposes of this Agreement) and dated May 22nd, 2014, by and between the following parties:

 

(1)PARTY A: beijing Jingwei sinan information technology Co., ltd (the “WFOE”)

Registered Address: Suite 515, North Building, Great Creativity Information Industry Garden, 18 Jiuxiaoqiao Middle Road, Chaoyang District

Legal Representative: Liu Jian

 

and

 

(2)PARTY B: YANG JING (the “Grantor”)

 

PRC Identification Card No: 310102197211124453

Address: Room 1504, No.2, Nong 138, Nandan Road, Xuhui District, Shanghai, PRC

 

(individually, a “Party” and collectively, the “Parties”)

 

WHEREAS:

 

A.The WFOE is a wholly foreign-owned enterprise, duly established and registered in Beijing under the laws of the PRC.

 

B.The Grantor currently holds 99% of the registered capital of Beijing Jingwei Zhihui Information Technology Co.,Ltd (the “Jingwei Zhihui”), a limited liability company with a registered capital of RMB 1,000,000 (the “Equity Interests”).

 

C.The Grantor entered into a Loan Agreement with the WFOE May 22nd, 2014(the “Loan Agreement”), pursuant to which the WFOE extended a loan in the amount of RMB 10,000 to the Grantor (the “Loan”).

 

D.The Grantor has agreed to grant exclusively to the WFOE an option to acquire the Equity Interest that has been registered in his name, subject to the terms and conditions set forth below.

 

Therefore, through friendly negotiation based on equal and mutual benefit, the Parties agree as follows:

 

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SECTION 1: GRANT OF THE OPTION

 

1.1Grant of Option

 

The Grantor hereby grants to the WFOE an option (the “Option”) to acquire all or portion of his Equity Interest at the price equivalent to the lowest price then permitted by PRC laws, and the WFOE shall make payment of such price by cancelling all or a same portion of the Loan. The Option shall become vested as of the date of this Agreement.

 

1.2Term

 

This Agreement shall take effect as of the Effective Date and shall remain in full force and effect until the earlier of (1) the date on which all of the Equity Interests have been acquired by the WFOE directly or through its designated representative (individual or legal person); or (2) the unilateral termination by the WFOE (at its sole and absolute discretion), by giving 30 days prior written notice to the Grantor of its intention to terminate this Agreement.

 

1.3Consideration of Option

 

The Grantor acknowledges that the WFOE’s provision of the Loan to the Grantor is deemed to be the consideration for the grant of the Option, the sufficiency and payment of which have been acknowledged and recognized.

 

1.4EFFECTIVE DATE

 

This Agreement shall be effective upon its being signed by the parties hereunder (“Effective Date”).

 

SECTION 2: EXERCISE OF THE OPTION AND ITS CLOSING

 

2.1Timing of Exercise

 

2.1.1The Grantor agrees that the WFOE in its sole discretion may at any time, and from time to time after the date hereof, exercise the Option granted by the Grantor, in whole or in part, to acquire all or any portion of his Equity Interest.

 

2.1.2For the avoidance of doubt, the Grantor hereby agrees that the WFOE shall be entitled to exercise the Option granted by the Grantor for an unlimited number of times, until all of his Equity Interest have been acquired by the WFOE.

 

2.1.3The Grantor agrees that the WFOE may designate in its sole discretion any third party to exercise the Option granted by the Grantor on its behalf, in which case the WFOE shall provide written notice to the Grantor at the time the Option granted by the Grantor is exercised.

 

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2.2Transfer

 

The Grantor agrees that the Option grant by him shall be freely transferable, in whole or in part, by the WFOE to any third party, and that, upon such transfer, the Option may be exercised by such third party upon the terms and conditions set forth herein, as if such third party were a party to this Agreement, and that such third party shall assume the rights and obligations of the WFOE hereunder.

 

2.3Notice Requirement

 

2.3.1To exercise an Option, the WFOE shall send a written notice to the Grantor, and such Option is to be exercised by no later than ten (10) days prior to each Closing Date (as defined below), specifying therein:

 

2.3.1.1The date of the effective closing of such acquisition (a “Closing Date”);

 

2.3.1.2the name of the person in which the Equity Interests shall be registered;

 

2.3.1.3the amount of Equity Interest to be acquired from the Grantor;

 

2.3.1.4the type of payment; and

 

2.3.1.5a letter of authorization, if a third party has been designated to exercise the Option.

 

2.3.2For the avoidance of doubt, it is expressly agreed among the parties that the WFOE shall have the right to exercise the Option and elect to register the Equity Interest in the name of another person as it may designate from time to time.

 

2.4Closing

 

On each Closing Date, the WFOE shall make payment by cancelling all or a portion of the Loan payable by the Grantor to the WFOE, in the same proportion that the WFOE or its designated party acquires the Equity Interest held by the Grantor.

  

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SECTION 3: COMPLETION

 

3.1Capital Contribution Transfer Agreement

 

Concurrently with the execution and delivery of this Agreement, and from time to time upon the request of the WFOE, the Grantor shall execute and deliver one or more capital contribution transfer agreements, each in the form and content substantially satisfactory to the WFOE (each, a “Transfer Agreement”), together with any other documents necessary to give effect to the transfer to the WFOE or its designated party of all or any part of the Equity Interest upon an exercise of the Option by the WFOE (the “Ancillary Documents”). Each Transfer Agreement and the Ancillary Documents are to be kept in the WFOE’s possession.

 

The Grantor hereby agrees and authorizes the WFOE to complete, execute and submit to the relevant company registrar any and all Transfer Agreements and the Ancillary Documents to give effect to the transfer of all or any part of the Equity Interest upon an exercise of the Option by the WFOE at its sole discretion where necessary and in accordance with this Agreement.

 

3.2Board Resolution

 

Notwithstanding Section 3.1 above, concurrently with the execution and delivery of this Agreement, and from time to time upon the request of the WFOE, the Grantor shall execute and deliver one or more resolutions of the board of directors and/or shareholders of the VIE Company, approving the following:

 

3.2.1The transfer by the Grantor of all or part of the Equity Interest held by the Grantor to the WFOE or its designated party; and

 

3.2.2any other matters as the WFOE may reasonably request.

 

Each Resolution is to be kept in the WFOE’s possession.

 

3.3Waiver of Right of First Refusal

 

Upon the prior written request of the WFOE, the Grantor shall waive any and all of his right of first refusal or other preemptive rights provided under the PRC laws or the articles of association of the VIE Company with respect to the equity transfer conducted by any other shareholder of the VIE Company.

 

3.4Return of Additional Consideration

 

If the WFOE or any transferee designated by the WFOE is required by applicable laws or competent authorities to pay any additional consideration (i.e., the transfer price is higher than the relevant registered capital of the VIE Company corresponding to the Equity Interest being transferred) to the Grantor for its exercise of the Options, the Grantor agrees to return any and all of such additional consideration to the WFOE or such transferee as soon as possible after the completion of such equity interest transfer.

 

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SECTION 4: REPRESENTATIONS AND WARRANTIES

 

4.1Representations and Warranties

 

The Grantor represents and warrants to the WFOE that:

 

4.1.1he has the full power and authority to enter into, and perform under, this Agreement;

 

4.1.2his signing of this Agreement or fulfilling of any of his obligations hereunder does not violate any laws, regulations and contracts to which he is bound, or require any government authorization or approval;

 

4.1.3there is no lawsuit, arbitration or other legal or government procedures pending which, based on his knowledge, shall materially and adversely affect this Agreement and the performance thereof;

 

4.1.4he has disclosed to the WFOE all documents issued by any government department that might cause a material adverse effect on the performance of his obligations under this Agreement;

 

4.1.5he has not been declared bankrupt by a court of competent jurisdiction;

 

4.1.6save as disclosed to the WFOE, his Equity Interest is free and clear from all liens, encumbrances and third party rights;

 

4.1.7he will not transfer, donate, pledge, or otherwise dispose of his Equity Interest in any way unless otherwise agreed by the WFOE;

 

4.1.8the Option granted to the WFOE by him shall be exclusive, and he shall in no event grant the Option or any similar rights to a third party by any means whatsoever; and

 

4.1.9the Grantor further represents and warrants to the WFOE that he owns 70% of the Equity Interest of the VIE Company. The Parties hereby agree that the representations and warranties set forth in Sections 4 (except for Section 4.1.9) shall be deemed to be repeated as of each Closing Date as if such representation and warranty were made on and as of such Closing Date.

 

4.2Covenants and Undertakings

 

The Grantor covenants and undertakes that:

 

4.2.1he will complete all such formalities as are necessary to make the WFOE or its designated party a proper and registered shareholder of the VIE Company. Such formalities include, but are not limited to, assisting the WFOE with the obtaining of necessary approvals of the equity transfer from relevant government authorities (if any), the submission of the Transfer Agreement(s) to the relevant administration for industry and commerce for the purpose of amending the articles of association, changing the shareholder register and undertaking any other changes;

 

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4.2.2he will, upon request by the WFOE, establish a domestic entity to hold the interests in the VIE Company as a Chinese joint venture partner in case the VIE Company is restructured into a foreign-invested telecommunication enterprise; and

 

4.2.3he will not amend the articles of association, increase or decrease the registered capital, sell, transfer, mortgage, create or allow any encumbrance or otherwise dispose of the assets, business, revenues or other beneficial interests, incur or assume any indebtedness, or enter into any material contracts, except in the ordinary course of business (for the purpose of this paragraph, any contract with a value exceeding RMB 100,000 shall be deemed to be a material contract).

 

SECTION 5: TAXES

 

Any taxes and duties that might arise from the execution and performance of this Agreement, including any taxes and expenses incurred by and applicable to the Grantor as a result of the exercise of the Option by the WFOE or its designated party, or the acquisition of the Equity Interest from the Grantor, will be borne by the WFOE.

 

SECTION 6: GOVERNING LAW AND DISPUTE SETTLEMENT

 

6.1Governing Law

 

The execution, validity, performance and interpretation of this Agreement shall be governed by and construed in accordance with the laws of the PRC.

 

6.2Friendly Consultation

 

If a dispute arises in connection with the interpretation or performance of this Agreement, the Parties shall attempt to resolve such dispute through friendly consultations between them or mediation by a neutral third party.

 

If the dispute cannot be resolved in the aforesaid manner within thirty (30) days after the commencement of such discussions, either Party may submit the dispute to arbitration.

 

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6.3Arbitration

 

Any dispute arising in connection with this Agreement shall be submitted to the China International Economic and Trade Arbitration Commission (“CIETAC”) Beijing headquarter for arbitration. The arbitration shall follow the then current rules of CIETAC, and the arbitration proceedings shall be conducted in Chinese and shall take place in Beijing. The arbitration award shall be final and binding upon the parties. This article shall not be affected by the termination or elimination of this Agreement.

 

6.4Matters not in Dispute

 

In case of any disputes arising out of the interpretation and performance of this Agreement or any pending arbitration of such dispute, each Party shall continue to perform their obligations under this Agreement, except for the matters in dispute.

 

SECTION 7: CONFIDENTIALITY

 

7.1Confidential Information

 

The contents of this Agreement and the annexes hereof shall be kept confidential. No Party shall disclose any such information to any third party (except for the purpose described in Section 2.2 and by prior written agreement among the parties). Each Party's obligations under this clause shall survive the termination of this Agreement.

 

7.2Exceptions

 

If a disclosure is explicitly required by law, any courts, arbitration tribunals, or administrative authorities, such disclosure by any Party shall not be deemed a violation of Section 7.1 above.

 

SECTION 8: MISCELLANEOUS

 

8.1Entire Agreement

 

8.1.1This Agreement constitutes the entire agreement and understanding among the Parties in respect of the subject matter hereof and supersedes all prior discussions, negotiations and agreements among them. This Agreement shall only be amended by a written instrument signed by all the parties.

 

8.1.2The appendices attached hereto shall constitute an integral part of this Agreement and shall have the same legal effect as this Agreement.

 

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8.2Notices

 

8.2.1Unless otherwise designated by the other Party, any notices or other correspondences among the parties in connection with the performance of this Agreement shall be delivered in person, by express mail, e-mail, facsimile or registered mail to the following correspondence addresses and fax numbers:

 

Beijing Jingwei Sinan Information Technology Co.,Ltd

Address: Suite 505, North Building, Great Creativity Information Industry Garden, 18 Jiuxiaoqiao Middle Road, Chaoyang District

Fax: 86-10-64362600

Tel : 86-10-84481818

Addressee : Liu Jian

 

Yang Jing

Address: 5/F, North Building, Great Creativity Information Industry Garden, 18 Jiuxiaoqiao Middle Road, Chaoyang Distric

Fax: 86-10-64362600

Tel : 86-10-84481818

 

8.2.2Notices and correspondences shall be deemed to have been effectively delivered:

 

8.2.2.1at the exact time displayed in the corresponding transmission record, if delivered by facsimile, unless such facsimile is sent after 5:00 pm or on a non-business day in the place where it is received, in which case the date of receipt shall be deemed to be the following business day;

 

8.2.2.2on the date that the receiving Party signs for the document, if delivered in person (including express mail);

 

8.2.2.3on the fifteenth (15th) day after the date shown on the registered mail receipt, if sent by registered mail;

 

8.2.2.4on the successful printing by the sender of a transmission report evidencing the delivery of the relevant e-mail, if sent by e-mail.

 

8.3Binding Effect

 

This Agreement, upon being signed by the parties or their duly authorized representatives, shall be binding on the parties and their successors and assigns.

 

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8.4Language and Counterparts

 

This Agreement shall be executed in two (2) originals in English, with one (1) original for each party.

 

8.5Days and Business Day

 

A reference to a day herein is to a calendar day. A reference to a business day herein is to a day on which commercial banks are open for business in the PRC.

 

8.6Headings

 

The headings contained herein are inserted for reference purposes only and shall not affect the meaning or interpretation of any part of this Agreement.

 

8.7Singular and Plural

 

Where appropriate, the plural includes the singular and vice versa.

 

8.8Unspecified Matter

 

Any matter not specified in this Agreement shall be handled through mutual discussions among the parties and stipulated in separate documents with binding legal effect, or resolved in accordance with PRC laws.

 

8.9Survival of Representations, Warranties, Covenants and Obligations

 

The respective representations, warranties, covenants and obligations of the parties, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any party, and shall survive the transfer and payment for the Equity Interest.

 

This Agreement has been signed by the parties or their duly authorized representatives on the date first specified above.

 

[The space below is intentionally left blank.]

 

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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed on their behalf by a duly authorized representative as of the date first written above.

 

Beijing Jingwei Sinan Information Technology Co., ltd

(Company Seal)

 

By:  /s/ Liu Jian  
Authorized Representative: Liu Jian  
   
Yang Jing  
   
By:  /s/ Yang Jing  

 

[SIGNATURE PAGE TO EQUITY OPTION AGREEMENT]

 

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