F-1/A
As
filed with the Securities and Exchange Commission on
September 13, 2010.
Registration No. 333-169170
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1 TO
Form F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SouFun Holdings Limited
(Exact name of Registrant as specified in its charter)
Not Applicable
(Translation of Registrants name into English)
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Cayman Islands
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7374
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Not Applicable |
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(State or other jurisdiction of
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(Primary Standard Industrial
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(I.R.S. Employer |
incorporation or organization)
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Classification Code Number)
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Identification Number) |
8th Floor, Tower 3, Xihuan Plaza
No. 1 Xizhimenwai Avenue
Xicheng District, Beijing 100044
Peoples Republic of China
Telephone: 86-10-5930-6668
(Address and telephone number, including area code, of Registrants principal executive offices)
Law Debenture Corporate Services Inc.
400 Madison Avenue, 4th Floor
New York, New York 10017
(212) 750-6474
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
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Huanting Timothy Li
Sidley Austin LLP
Level 39,
Two International Finance Centre
8 Finance Street
Central, Hong Kong
(852) 2509-7888
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William Y. Chua
Sullivan & Cromwell LLP
28th Floor
Nine Queens Road Central
Hong Kong
(852) 2826-8688
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Leiming Chen
Simpson Thacher & Bartlett LLP
35th Floor, ICBC Tower
3 Garden Road
Central, Hong Kong
(852) 2514-7600 |
Approximate date of commencement of proposed sale to the public: as soon as practicable
after the effective date of this registration statement.
If any of the securities being registered on this Form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following
box. o
If this Form is filed to register additional securities for an offering pursuant to
Rule 462(b) under the Securities Act, please check the following box and list the Securities Act
registration statement number of the earlier effective registration statement for the same
offering. o
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the
Securities Act, check the following box and list the Securities Act registration statement number
of the earliest effective registration statement for the same offering. o
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the
Securities Act, check the following box and list the Securities Act registration statement number
of the earlier effective registration statement for the same offering. o
The Registrant hereby amends this Registration Statement on such date or dates as may be
necessary to delay its effective date until the Registrant shall file a further amendment which
specifically states that this Registration Statement shall thereafter become effective in
accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the
Registration Statement shall become effective on such date as the Securities and Exchange
Commission, acting pursuant to such Section 8(a), may determine.
TABLE OF CONTENTS
Explanatory Note
The sole purpose of this amendment is to amend the exhibit index and to file Exhibit 1.1
to the registration statement and to amend and restate Exhibits 3.2 and 5.1 to the registration
statement and the table set forth in Item 7 of Part II of the registration statement to correct certain clerical errors therein. No other changes have been made to the
registration statement. Accordingly, this amendment consists only of the facing page, this
explanatory note and Part II of the registration statement.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 6. Indemnification of Directors and Officers
Cayman Islands law does not limit the extent to which a companys articles of association
may provide indemnification of officers and directors, except to the extent any such provision may
be held by the Cayman Island courts to be contrary to the public interest, such as providing
indemnification against civil fraud or the consequences of committing a crime. The registrants
amended and restated articles of association provide that each officer or director, every auditor
for the time being of the registrant and the liquidator or trustee of the registrant shall be
indemnified and secured harmless out of the assets and profits of the registrant from and against
all actions, costs, charges, losses, damages and expenses which they or any of them shall or may
incur or sustain by or by reason of any act done, concurred in or omitted in or about the execution
of their duty or supposed duty, provided that the indemnity shall not extend to any matter in
respect of any fraud or dishonesty which may attach to any of said persons.
Pursuant to indemnification agreements, the form of which is filed as Exhibit 10.2 to
this Registration Statement, we will agree to indemnify our directors and officers against certain
liabilities and expenses incurred by such persons in connection with claims made by reason of their
being such a director or officer.
Insofar as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers or persons controlling the registrant pursuant to the foregoing
provisions, the registrant has been advised that in the opinion of the SEC such indemnification is
against public policy as expressed in the Securities Act and therefore is unenforceable.
Item 7. Recent Sales of Unregistered Securities
During the past three years, we issued our securities listed below without registering
the securities under the Securities Act. None of these transactions involved any underwriters
underwriting discounts or commissions, or any public offering. We believe that each of the
following option grants was exempt from registration in reliance on Rule 701 and Regulation S under
the Securities Act or Section 4(2) of the Securities Act.
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Underwriting |
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Number of |
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Consideration |
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discount and |
Purchaser |
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Date of sale or issuance |
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securities |
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(US$/share) |
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commission |
Certain directors, officers and employees as a group
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December 31, 2007
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options to purchase a total of 992,554 non-voting ordinary shares
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US$ 5.00
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Not applicable |
Certain directors, officers and employees as a group
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December 31, 2008
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options to purchase a total of 986,554 non-voting ordinary shares
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US$ 5.00
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Not applicable |
Certain directors, officers and employees as a group
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December 31, 2009
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options to purchase a total of 516,827 non-voting ordinary shares
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US$ 10.00
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Not applicable |
Certain directors, officers and employees as a group
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April 20, 2010 |
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options to
purchase a total of
18,750 non-voting
ordinary shares |
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US$ 10.00 |
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Not applicable |
II-1
Item 8. Exhibits and Financial Statement Schedules
(a) Exhibits
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Exhibit No. |
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Description of Exhibit |
1.1**
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Form of Underwriting Agreement |
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3.1*
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Third Amended and Restated Memorandum and Articles of Association of the Registrant |
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3.2**
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Fourth Amended and Restated Memorandum and Articles of Association of the Registrant |
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4.1*
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Specimen ordinary share certificate |
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4.2*
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Specimen American depositary receipt, incorporated by reference to Registration Statement on Form F-6
(Registration No. 333-169176) filed with the SEC |
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4.3*
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Form of Deposit Agreement, incorporated by reference to Registration Statement on Form F-6 (Registration
No. 333-169176) filed with the SEC |
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4.4*
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Shareholders Agreement, dated August 31, 2006 |
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4.5*
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Stock Related Award Incentive Plan of 1999 |
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4.6*
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2010 Stock Incentive Plan |
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4.7*
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Investors Rights Agreement among the Registrant, General Atlantic, Apax, Next Decade, Media Partner and
Digital Link, dated August 13, 2010 |
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4.8*
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Registration Rights Agreement among the Registrant, General Atlantic and Apax, dated August 13, 2010 |
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4.9*
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Options Exercise Agreement among Telstra International, the Registrant and Mr. Mo, dated August 12, 2010 |
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5.1**
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Opinion of Conyers, Dill & Pearman, Cayman Islands special counsel to the Registrant, regarding the validity
of the ordinary shares being registered |
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8.1*
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Opinion of Conyers, Dill & Pearman, special Cayman Islands tax counsel to the Registrant, regarding tax matters |
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8.2*
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Opinion of Sidley Austin LLP regarding certain U.S. tax matters |
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10.1*
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Form of Employment Agreement |
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10.2*
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Form of Indemnification Agreement |
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10.3*
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Form of Loan Agreement between and among SouFun Network or SouFun Media and Mr. Mo and Mr. Dai as shareholders
of a consolidated controlled entity |
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10.4*
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Form of Equity Pledge Agreement among SouFun Network or SouFun Media, Mr. Mo and/or Mr. Dai and/or other
shareholders of a consolidated controlled entity pledging the shares of the consolidated controlled entity |
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10.5*
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Form of Shareholders Proxy Agreement among SouFun Network or SouFun Media, a consolidated controlled entity,
Mr. Mo and/or Mr. Dai and/or other shareholders of the consolidated controlled entity |
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10.6*
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Form of Operating Agreement among SouFun Network or SouFun Media, a consolidated controlled entity, Mr. Mo
and/or Mr. Dai and/or other shareholders of the consolidated controlled entity |
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10.7*
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Form of Exclusive Technical Consultancy and Services Agreement between SouFun Network or SouFun Media and a
consolidated controlled entity |
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10.8*
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Form of Exclusive Call Option Agreement among SouFun Holdings Limited, Mr. Mo and/or Mr. Dai and/or other
shareholders of a consolidated controlled entity, the consolidated controlled entity and SouFun Network and/or
SouFun Media |
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10.9*
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Form of Amendment Agreement Relating to Exclusive Technical Consultancy and Services Agreement, Exclusive Call
Option Agreement, Operating Agreement and Other Agreements among SouFun Network and/or SouFun Media, a
consolidated controlled entity, Mr. Mo, Mr. Dai and/or other shareholders of the consolidated controlled
entity and SouFun Holdings Limited |
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10.10*
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Form of Intra-group Memorandum of Understanding between SouFun Network or SouFun Media and a consolidated
controlled entity |
II-2
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Exhibit No. |
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Description of Exhibit |
10.11*
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Web Promotion Technical Service Contract, dated April 23, 2010, between
CNED Hengshui Zhongcheng Wanyuan Home Co., Ltd. and SouFun Media |
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10.12*
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Individual Entrustment Loan Agreement, dated November 5, 2009, between
CNED Hengshui Zhongcheng Wanyuan Home Co., Ltd., as borrower, and Bank
of Communications, as lender, with SouFun Media, as principal |
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10.13*
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Web Promotion Technical Service Contract, dated February 5, 2010,
between Beijing Dong Fang Xi Mei Investment Consulting Co., Ltd. and
Beijing Technology |
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10.14*
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Termination Agreement With Respect to Web Promotion and Technical
Service Contract, dated July 5, 2010, between Beijing Dong Fang Xi Mei
Investment Consulting Co., Ltd. and Beijing SouFun Technical
Development Co. Ltd. |
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10.15*
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Web Promotion Technical Service Contract, dated July 16, 2010, between
Beijing Wei Ye Hang Real Estate Agency Co., Ltd. and Beijing SouFun
Technical Development Co. Ltd. |
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10.16*
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Indemnity Agreement among Mr. Mo, CNED Hengshui Zhengcheng Wanyuan Home
Co., Ltd. and the Registrant |
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21.1*
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List of subsidiaries of the Registrant |
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23.1*
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Consent of Ernst & Young Hua Ming |
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23.2*
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Consent of Conyers Dill & Pearman (included in Exhibit 5.1) |
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23.3*
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Consent of King & Wood |
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23.4*
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Consent of Jones Lang LaSalle Sallmanns Limited |
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23.5*
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Consent of CR-Nielsen |
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23.6*
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Consent of Data Center of China Internet |
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23.7*
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Consent of Shenzhen Union Strength Business Consulting Co., Ltd. |
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23.8*
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Consent of CCPIT Patent & Trademark Law Office |
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23.9*
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Consent of Qian Zhao, an independent director appointee |
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23.10*
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Consent of Sam Hanhui Sun, an independent director appointee |
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23.11*
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Consent of Jeff Xuesong Leng, an independent director appointee |
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23.12*
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Consent of Thomas Nicholas Hall, an independent director appointee |
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24.1*
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Power of Attorney (included on page II-5 of this Registration Statement) |
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99.1*
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Code of Business Conduct and Ethics of the Registrant |
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99.2*
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Anti-Fraud and Whistle-Blower Policy of the Registrant |
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* |
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Filed previously |
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** |
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Filed herewith |
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(b) Financial Statement Schedules.
None.
ITEM 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act, the information
omitted from the form of prospectus filed as part of this registration statement in reliance
upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to
Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act, each
post-effective amendment that contains a form of prospectus shall be deemed to be a new
registration statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering thereof.
(b) The undersigned registrant hereby undertakes to provide to the underwriters at the closing
specified in the underwriting agreement, certificates in such denominations and registered in such
names as required by the underwriters to permit prompt delivery to each purchaser.
(c) Insofar as indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the registrant pursuant to the
provisions described in Item 6, or otherwise, the registrant has been advised that, in the opinion
of the SEC, such indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final adjudication of such
issue.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant
certifies that it has reasonable grounds to believe that it meets all of the requirements for
filing on Form F-1 and has duly caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in Beijing, China on
September 13, 2010.
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SouFun Holdings Limited
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By: |
/s/ Tianquan Vincent Mo
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Name: |
Tianquan Vincent Mo |
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Title: |
Executive Chairman |
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Pursuant to the requirements of the Securities Act, this Registration Statement has been
signed by the following persons in the capacities and on
September 13, 2010.
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Signature |
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Title |
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/s/ Tianquan Vincent Mo
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Executive Chairman |
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Tianquan Vincent Mo |
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*
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Director |
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Quan Zhou |
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*
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Director |
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Shan Li |
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*
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President and Chief Executive Officer |
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(principal executive officer) |
Richard Jiangong Dai |
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*
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Chief Financial Officer |
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(principal financial officer) |
Lan Ying Guan |
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*
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Principal Accounting Officer |
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Ji Wenting |
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*By:
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/s/ Tianquan Vincent Mo
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Tianquan Vincent Mo |
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Attorney-in-fact |
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II-4
SIGNATURE OF AUTHORIZED REPRESENTATIVE IN THE UNITED STATES
Pursuant to the Securities Act of 1933, as amended, the undersigned, the duly authorized
representative in the United States of SouFun Holdings Limited, has signed this registration
statement or amendment thereto in City of New York, State of New
York, on September 13, 2010.
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Law Debenture Corporate Services Inc.
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By: |
/s/ Kate Ledyard
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Name: |
Kate Ledyard |
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Title: |
Manager
Law Debenture Corporate Services Inc. |
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II-5
INDEX TO EXHIBITS
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Exhibit No. |
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Description of Exhibit |
1.1**
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Form of Underwriting Agreement |
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3.1*
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Third Amended and Restated Memorandum and Articles of Association of the Registrant |
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3.2**
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Fourth Amended and Restated Memorandum and Articles of Association of the Registrant |
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4.1*
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Specimen ordinary share certificate |
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4.2*
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Specimen American depositary receipt, incorporated by reference to Registration Statement on Form F-6
(Registration No. 333-169176) filed with the SEC |
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4.3*
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Form of Deposit Agreement, incorporated by reference to Registration Statement on Form F-6 (Registration
No. 333-169176) filed with the SEC |
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4.4*
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Shareholders Agreement, dated August 31, 2006 |
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4.5*
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Stock Related Award Incentive Plan of 1999 |
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4.6*
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2010 Stock Incentive Plan |
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4.7*
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Investors Rights Agreement among the Registrant, General Atlantic, Apax, Next Decade, Media Partner and
Digital Link, dated August 13, 2010 |
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4.8*
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Registration Rights Agreement among the Registrant, General Atlantic and Apax, dated August 13, 2010 |
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4.9*
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Options Exercise Agreement among Telstra International, the Registrant and Mr. Mo, dated August 12, 2010 |
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5.1**
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Opinion of Conyers, Dill & Pearman, Cayman Islands special counsel to the Registrant, regarding the validity
of the ordinary shares being registered |
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8.1*
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Opinion of Conyers, Dill & Pearman, special Cayman Islands tax counsel to the Registrant, regarding tax matters |
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8.2*
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Opinion of Sidley Austin LLP regarding certain U.S. tax matters |
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10.1*
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Form of Employment Agreement |
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10.2*
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Form of Indemnification Agreement |
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10.3*
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Form of Loan Agreement between and among SouFun Network or SouFun Media and Mr. Mo and Mr. Dai as shareholders
of a consolidated controlled entity |
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10.4*
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Form of Equity Pledge Agreement among SouFun Network or SouFun Media, Mr. Mo and/or Mr. Dai and/or other
shareholders of a consolidated controlled entity pledging the shares of the consolidated controlled entity |
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10.5*
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Form of Shareholders Proxy Agreement among SouFun Network or SouFun Media, a consolidated controlled entity,
Mr. Mo and/or Mr. Dai and/or other shareholders of the consolidated controlled entity |
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10.6*
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Form of Operating Agreement among SouFun Network or SouFun Media, a consolidated controlled entity, Mr. Mo
and/or Mr. Dai and/or other shareholders of the consolidated controlled entity |
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10.7*
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Form of Exclusive Technical Consultancy and Services Agreement between SouFun Network or SouFun Media and a
consolidated controlled entity |
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10.8*
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Form of Exclusive Call Option Agreement among SouFun Holdings Limited, Mr. Mo and/or Mr. Dai and/or other
shareholders of a consolidated controlled entity, the consolidated controlled entity and SouFun Network and/or
SouFun Media |
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10.9*
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Form of Amendment Agreement Relating to Exclusive Technical Consultancy and Services Agreement, Exclusive Call
Option Agreement, Operating Agreement and Other Agreements among SouFun Network and/or SouFun Media, a
consolidated controlled entity, Mr. Mo, Mr. Dai and/or other shareholders of the consolidated controlled
entity and SouFun Holdings Limited |
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10.10*
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Form of Intra-group Memorandum of Understanding between SouFun Network or SouFun Media and a consolidated
controlled entity |
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Exhibit No. |
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Description of Exhibit |
10.11*
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Web Promotion Technical Service Contract, dated April 23, 2010, between
CNED Hengshui Zhongcheng Wanyuan Home Co., Ltd. and SouFun Media |
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10.12*
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Individual Entrustment Loan Agreement, dated November 5, 2009, between
CNED Hengshui Zhongcheng Wanyuan Home Co., Ltd., as borrower, and Bank
of Communications, as lender, with SouFun Media, as principal |
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10.13*
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Web Promotion Technical Service Contract, dated February 5, 2010,
between Beijing Dong Fang Xi Mei Investment Consulting Co., Ltd. and
Beijing Technology |
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10.14*
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Termination Agreement With Respect to Web Promotion and Technical
Service Contract, dated July 5, 2010, between Beijing Dong Fang Xi Mei
Investment Consulting Co., Ltd. and Beijing SouFun Technical
Development Co. Ltd. |
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10.15*
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Web Promotion Technical Service Contract, dated July 16, 2010, between
Beijing Wei Ye Hang Real Estate Agency Co., Ltd. and Beijing SouFun
Technical Development Co. Ltd. |
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10.16*
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Indemnity Agreement among Mr. Mo, CNED Hengshui Zhengcheng Wanyuan Home
Co., Ltd. and the Registrant |
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21.1*
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List of subsidiaries of the Registrant |
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23.1*
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Consent of Ernst & Young Hua Ming |
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23.2*
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Consent of Conyers Dill & Pearman (included in Exhibit 5.1) |
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23.3*
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Consent of King & Wood |
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23.4*
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Consent of Jones Lang LaSalle Sallmanns Limited |
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23.5*
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Consent of CR-Nielsen |
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23.6*
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Consent of Data Center of China Internet |
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23.7*
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Consent of Shenzhen Union Strength Business Consulting Co., Ltd. |
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23.8*
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Consent of CCPIT Patent & Trademark Law Office |
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23.9*
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Consent of Qian Zhao, an independent director appointee |
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23.10*
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Consent of Sam Hanhui Sun, an independent director appointee |
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23.11*
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Consent of Jeff Xuesong Leng, an independent director appointee |
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23.12*
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Consent of Thomas Nicholas Hall, an independent director appointee |
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24.1*
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Power of Attorney (included on page II-5 of this Registration Statement) |
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99.1*
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Code of Business Conduct and Ethics of the Registrant |
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99.2*
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Anti-Fraud and Whistle-Blower Policy of the Registrant |
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* |
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Filed previously |
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** |
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Filed herewith |
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EX-1.1
Exhibit 1.1
SouFun Holdings Limited
[] Class A Ordinary Shares in the form of American Depositary Shares
(each representing four Class A Ordinary Shares, par value HK$1.00 per Class A Ordinary Share)
FORM OF EQUITY UNDERWRITING AGREEMENT
[], 2010
Deutsche Bank Securities Inc.
60 Wall Street, 4th Floor
New York, New York 10005
and
Goldman Sachs (Asia) L.L.C.
68/F Cheung Kong Center
2 Queens Road Central
Hong Kong
As Representatives of the
Several Underwriters
Ladies and Gentlemen:
SouFun Holdings Limited, an exempted company incorporated in the Cayman Islands (the
Company), and Telstra International Holdings Limited, as a selling shareholder (Telstra), a
Bermuda company, and IDG Technology Venture Investment Inc., such shareholders, together with
Telstra, the Selling Shareholders), propose to sell to the several underwriters named in
Schedule I hereto (the Underwriters) for whom you are acting as representatives (the
Representatives) an aggregate of [] American depositary shares (ADSs) representing [] Class A
ordinary shares, par value HK$1.00 per share (the Class A Ordinary Shares), of the Company, of
which [] ADSs will be sold by the Company and [] ADSs will be sold by the Selling Shareholders.
The [] ADSs to be sold by the Company and the Selling Shareholders are referred to as the Firm
ADSs. The respective amounts of the Firm ADSs to be so purchased by the several Underwriters are
set forth opposite their names in Schedule I hereto, and the respective amounts to be sold
by the Selling Shareholders are set forth opposite their names in Schedule II hereto. The
Class A Ordinary Shares represented by the Firm ADSs (the Firm Shares) will be deposited by the
Company and Selling Shareholders with JPMorgan Chase Bank, N.A., as depositary (the Depositary).
The Firm Shares and the Firm ADSs are hereinafter collectively referred to as the Firm
Securities. The Selling Shareholders also propose to sell at the Underwriters option an
aggregate of up to [] additional ADSs of the Company (the Option ADSs) as set forth below,
solely to cover over-allotments (if any). To the extent that Option ADSs are sold to the
Underwriters pursuant to such option, such Class A Ordinary Shares represented by such Option ADSs
(the Option Shares) will be deposited by the Selling Shareholders with the Depositary. The
Option Shares and the Option ADSs are hereinafter collectively referred to as the Option
Securities. The Firm ADSs and the Option ADSs are hereinafter collectively referred to as the
ADSs. The Firm Shares and the Option Shares are hereinafter collectively referred to as the
Shares. The Firm Securities and the Option Securities (to the extent that the aforementioned
option is exercised) are hereinafter collectively referred to as the Offered Securities. The
public offering of the Offered Securities as described herein and in the General Disclosure
Package (as defined below) is hereinafter referred to as the Offering. The Representatives are
entering into this agreement with the Company, the Selling Shareholders and Vincent Tianquan Mo, a
natural person, (the Founder).
As the Representatives, you have advised the Company, the Founder and the Selling Shareholders
(a) that you are authorized to enter into this agreement (the Agreement) on behalf of the several
Underwriters, and (b) that the several Underwriters are willing, acting severally and not jointly,
to purchase the numbers of Firm ADSs set forth opposite their respective names in Schedule
I, plus their pro rata portion of the Option ADSs if you elect to exercise the over-allotment
option in whole or in part for the accounts of the several Underwriters.
In consideration of the mutual agreements contained herein and of the interests of the parties
in the transactions contemplated hereby, the parties hereto agree as follows:
1.
Representations and Warranties of the Company and the Founder.
(a) The Company and the Founder, jointly and severally, represents and warrants to each of the
Underwriters as follows:
(i) A registration statement on Form F-1 (File No. 333-169170) with respect to the Offered
Securities has been prepared by the Company in conformity in all material respects with the
requirements of the Securities Act of 1933, as amended (the Act), and the rules and regulations
(the Rules and Regulations) of the Securities and Exchange Commission (the Commission)
thereunder and has been filed with the Commission. Copies of such registration statement,
including any amendments thereto, the preliminary prospectuses (meeting the requirements of the
Rules and Regulations) contained therein and the exhibits, financial statements and schedules, as
finally amended and revised, have heretofore been delivered by the Company to you. Such
registration statement, together with any registration statement filed by the Company pursuant to
Rule 462(b) under the Act, is herein referred to as the Registration Statement, which shall be
deemed to include all information omitted therefrom in reliance upon Rules 430A, 430B or 430C under
the Act and contained in the Prospectus referred to below, has become effective under the Act and
no post-effective amendment to the Registration Statement has been filed, or is proposed to be
filed, as of the date of this Agreement. Prospectus means the form of prospectus first filed with
the Commission pursuant to and within the time limits described in Rule 424(b) under the Act. Each
preliminary prospectus included in the Registration Statement prior to the time it becomes
effective is herein referred to as a Preliminary Prospectus.
(ii) As of the Effective Date (as defined below), as of the Applicable Time (as defined
below), as of the Closing Date (as defined below) and as of the Option Closing Date (as defined
below), as the case may be, neither (i) the General Use Free Writing Prospectus(es) (as defined
below) issued at or prior to the Applicable Time, the Statutory Prospectus (as defined below), and
the information included on Schedule III hereto, all considered together (collectively, the
General Disclosure Package), nor (ii) any individual Limited Use Free Writing Prospectus (as
defined below), when considered together with the General Disclosure Package, included or will
include any untrue statement of a material fact or omitted or will omit to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, that neither the Company nor the Founder makes
any representation or warranty as to information contained in or omitted from the Registration
Statement, the Prospectus or any Issuer Free Writing Prospectus (as defined below), in
2
reliance upon, and in conformity with, written information furnished to the Company by or on
behalf of any Underwriter through the Representatives, specifically for use therein, it being
understood and agreed that the only such information is that described in Section 13 herein. As
used in this subsection and elsewhere in this Agreement:
Applicable Time means [] [a/p]m (New York time) on the date of this Agreement or such other
time as agreed to by the Company and the Representatives.
Effective Date with respect to the Registration Statement means the date of the Effective
Time thereof.
Effective Time with respect to the Registration Statement means the date and time of which
such Registration Statement was declared effective by the Commission or has become effective upon
filing pursuant to Rule 462(c).
Statutory Prospectus as of any time means the Preliminary Prospectus relating to the Offered
Securities that is included in the Registration Statement immediately prior to that time.
Issuer Free Writing Prospectus means any issuer free writing prospectus, as defined in
Rule 433 under the Act, relating to the Offered Securities in the form filed or required to be
filed with the Commission or, if not required to be filed, in the form retained in the Companys
records pursuant to Rule 433(g) under the Act.
General Use Free Writing Prospectus means any Issuer Free Writing Prospectus identified on
Schedule IV to this Agreement.
Limited Use Free Writing Prospectus means any Issuer Free Writing Prospectus that is not a
General Use Free Writing Prospectus.
(iii) (a) A registration statement on Form F-6 (No. 333-169176) in respect of the ADSs has
been filed with the Commission and such registration statement has become effective pursuant to the
Rules and Regulations (such registration statement, including all exhibits thereto, at the time it
became effective, being hereinafter referred to as the ADS Registration Statement), (b) no stop
order suspending the effectiveness of the ADS Registration Statement is in effect, and no
proceedings for such purpose are pending before or to the Companys and the Founders knowledge,
threatened by the Commission, (c) the ADS Registration Statement when it became effective
conformed, and any further amendments thereto will conform, in all material respects to the
requirements of the Act and the Rules and Regulations, and (d) the ADS Registration Statement, when
it became effective, did not contain and, on each Closing Date (as defined below) and as amended or
supplemented, will not contain, any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein not misleading.
(iv) A registration statement on Form 8-A (File No. 001-34862) in respect of the registration
of the Shares under the U.S. Securities Exchange Act of 1934, as amended (the Exchange Act), has
been filed with the Commission; such registration statement in the form heretofore delivered to you
and to you for each of the other Underwriters has been declared effective by the Commission in such
form; no other document with respect to such registration statement has heretofore been filed with
the Commission; no stop order suspending the effectiveness of such registration statement has been
issued and no proceeding for that purpose has been initiated or to the Companys and the Founders
knowledge threatened by the Commission (the various parts of such registration statement, including
all exhibits
3
thereto, each as amended at the time such part of the registration statement became
effective, being
hereinafter called the Form 8-A Registration Statement); and the Form 8-A Registration
Statement when it became effective conformed, and any further amendments thereto will conform, in
all material respects to the requirements of the Exchange Act and the rules and regulations of the
Commission thereunder, and did not and will not, as of the applicable effective date, contain an
untrue statement of a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
(v) The Commission has not issued an order preventing or suspending the use of any Preliminary
Prospectus, any Issuer Free Writing Prospectus or the Prospectus relating to the proposed offering
of the Offered Securities, and no proceeding for that purpose or pursuant to Section 8A of the Act
has been instituted or, to the Companys knowledge, threatened by the Commission. The Registration
Statement contains, and the Prospectus and any amendments or supplements thereto will contain, all
statements which are required to be stated therein by, and will conform to, the material
requirements of the Act and the Rules and Regulations.
(vi) Each Issuer Free Writing Prospectus, as of its issue date and at all subsequent times
through the completion of the public offer and sale of the Offered Securities or until any earlier
date that the Company notified or notifies to the Representatives as described in the next
sentence, did not, does not and will not include any information that conflicted, conflicts or will
conflict with the information contained in the Registration Statement or the Prospectus. If
following issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or
development as a result of which such Issuer Free Writing Prospectus conflicted with or would
conflict with the information then contained in the Registration Statement or as a result of which
such Issuer Free Writing Prospectus, if republished immediately following such event or
development, would include an untrue statement of a material fact or omitted or would omit to state
a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading: (i) the Company has promptly notified or
will promptly notify each of the Representatives; and (ii) the Company has promptly amended or will
promptly amend or supplement such Issuer Free Writing Prospectus to eliminate or correct such
conflict, untrue statement or omission.
(vii) The Company does not own or control, directly or indirectly, any corporation,
association or entity other than the following entities (collectively referred to as the Group
Entities): Selovo Investments Limited (Selovo), Pendiary Investments Limited (Pendiary), Max
Impact Investments Limited Max Impact), Bravo Work Investments Limited Service Co. Ltd.
(Bravo), China Index Academy Ltd. (China Index) SouFun Media Technology (Beijing) Co., Ltd.
(SouFun Media), Beijing SouFun Network Technology Co., Ltd. (SouFun Network), Beijing SouFun
Information Consultancy Co., Ltd. (Beijing Information), Beijing Zhong Zhi Shi Zheng Information
Technology Co., Ltd. (Beijing Zhong Zhi), Shanghai SouFun Information Co., Ltd. (SouFun
Shanghai), SouFun Information (Shenzhen) Co., Ltd. (SouFun Shenzhen), SouFun Information
(Tianjin) Co., Ltd. (SouFun Tianjin), SouFun Information (Guangzhou) Co., Ltd. (SouFun
Guangzhou), Beijing SouFun Internet Information Service Co., Ltd., (Beijing Internet), Beijing
Jia Tian Xia Advertising Co., Ltd. (Beijing Advertising), Beijing SouFun Science and Technology
Development Co., Ltd. (Beijing Technology), Beijing China Index Information Co., Ltd. (Beijing
China Index), Shanghai Jia Biao Tang Advertising Co., Ltd. (Shanghai JBT Advertising), Shanghai
SouFun Advertising Co., Ltd. (Shanghai Advertising), Beijing Century Jia Tian Xia Technology
Development Co., Ltd. (Beijing JTX Technology), Tianjin Jia Tian Xia Advertising Co., Ltd.
(Tianjin JTX Advertising), Shanghai China Index Consultancy Co., Ltd. (Shanghai China Index),
Beijing Li Tian Rong Ze Technology Development Co., Ltd. (Beijing Li Tian), and Tianjin Xin Rui
Jia Tian Xia Advertising Co., Ltd.
4
(Tianjin Xin Rui). Other than the Group Entities, no other
subsidiary of the Company is a Significant Subsidiary as defined in Regulation S-X under the Act.
(viii) The Company has been duly incorporated under the laws of the Cayman Islands, and is
validly existing as an exempted company with limited liability under the laws of the Cayman
Islands, with corporate power and authority to own or lease its properties and conduct its business
as described in the Registration Statement, the General Disclosure Package and the Prospectus.
Each of the Group Entities has been duly organized and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, with corporate power and
authority to own or lease its properties and conduct its business as described in the Registration
Statement, the General Disclosure Package and the Prospectus. The Company and each of the Group
Entities are duly qualified to transact business in all jurisdictions in which the conduct of their
business or the ownership or leasing of property requires such qualification, except to the extent
such failure to be qualified would not either (i) have, individually or in the aggregate, a
material adverse effect on the earnings, business, management, properties, assets, rights,
operations, condition (financial or otherwise) or prospects of the Company and of the Group
Entities taken as a whole, whether or not arising in the ordinary course, or (ii) prevent the
consummation of the transactions contemplated hereby (the occurrence of any such effect or any such
prevention described in the foregoing clauses (i) and (ii) being referred to as a Material Adverse
Effect); and except as disclosed in the Registration Statement, the General Disclosure Package and
the Prospectus, each of the business licenses and articles of association of each of the Group
Entities formed under the laws and regulations of the PRC is in full force and effect under, and in
compliance with PRC law.
(ix) The Company has, or will have at the first Closing Date (as the case may be), an
authorized and paid-in capitalization as set forth in the Prospectus, and all of the issued share
capital of the Company have been duly authorized and validly issued and are fully paid and
non-assessable and, at each Closing Date, will conform in all material respects to the description
of the Class A Ordinary Shares and the Class B ordinary shares of the Company, par value HK$1.00
per share (the Class B Ordinary Shares, together with the Class A Ordinary Shares, the Ordinary
Shares) contained in the Pricing Disclosure Package and the Prospectus; the Offered Securities to
be issued and sold by the Company and the Selling Shareholders have been duly authorized and when
issued and paid for as contemplated herein will be validly issued, fully paid and non-assessable
and freely transferable to and for the account of the several Underwriters; and no preemptive
rights of shareholders exist with respect to any of the Offered Securities or the sale thereof,
except as disclosed in the Registration Statement, the General Disclosure Package and the
Prospectus. There are no outstanding securities convertible into or exchangeable for, or warrants,
rights or options to purchase from the Company, or obligations of the Company to issue, Ordinary
Shares or any other class of share capital of the Company and neither the filing of the
Registration Statement nor the offering or sale of the Offered Securities as contemplated by this
Agreement gives rise to any rights, other than those which have been disclosed in the Registration
Statement, the General Disclosure Package and the Prospectus, waived or satisfied, for or relating
to the registration of any Offered Securities.
(x) The outstanding shares of capital stock of each of the Group Entities have been duly
authorized and validly issued, are fully paid and non-assessable and, except as set forth in the
Registration Statement, the General Disclosure Package and the Prospectus, are owned by the Company
or another Group Entity free and clear of all liens, encumbrances and equities and claims; and no
options, warrants or other rights to purchase, agreements or other obligations to issue or other
rights to convert any obligations into shares or ownership interests in the Group Entities are
outstanding.
(xi) The information set forth under the caption Capitalization in the Registration
Statement and the Prospectus (and any similar section or information contained in the General
Disclosure
5
Package) is true and correct in all material respects. All of the Offered Securities
conform (or will conform at each Closing Date, as the case may be) to the description thereof
contained in the Registration Statement, the General Disclosure Package and the Prospectus. The
authorized capital conforms as to
legal matters in all material respects to the description thereof contained in the
Registration Statement and the Prospectus (and any similar section or information contained in the
General Disclosure Package).
(xii) The information set forth under the caption Description of the American Depositary
Shares, insofar as they purport to constitute a summary of the ADSs, and under Taxation, insofar
as they purport to describe the legal matters and documents referred to therein, are accurate and
fair summaries of such legal matters and documents.
(xiii) Except as disclosed in the Registration Statement, the General Disclosure Package and
the Prospectus, the ownership structures of Beijing Zhong Zhi, SouFun Media and SouFun Network
(collectively, the PRC Subsidiaries), Beijing Advertising, Beijing Internet, Beijing Technology,
Shanghai Advertising, Shanghai China Index, Beijing Li Tian, Beijing China Index, Shanghai JBT
Advertising, Tianjin JTX Advertising, Beijing JTX Technology and Tianjin Xin Rui (collectively, the
PRC Operating Companies) as described in the General Disclosure Package and the Prospectus under
the caption Our History and Corporate Structure are not in breach or violation of, and
immediately after the Offering, will not be in breach or violation of any applicable PRC laws, has
not been challenged by any governmental agency and there are no legal, arbitration, governmental or
other legal proceedings, pending before or to the knowledge of the Company and the Founder,
threatened or contemplated by any Governmental Agency in respect of the ownership structures of the
PRC Subsidiaries and PRC Operating Companies, expect as disclosed in the General Disclosure
Package; and the contractual arrangements (the Agreements) among the PRC Subsidiaries and PRC
Operating Companies as described in the General Disclosure Package and the Prospectus under the
caption Our History and Corporate Structure does not and immediately after the Offering, will not
violate current PRC laws.
(xiv) Each of the Agreements to which the PRC Subsidiaries and PRC Operating Companies is a
party has been duly authorized, executed and delivered by each such entity, as the case may be, and
each such entity has, to the extent applicable, taken all necessary corporate action to authorize
the execution, delivery and performance thereof; each of the PRC Subsidiaries and the PRC Operating
Companies had the corporate power and capacity to enter into and perform its obligations
thereunder; each of the Agreements to which each such entity is a party constitutes the legal,
valid and binding obligation of such entity, as the case may be, enforceable against such entity,
as the case may be, in accordance with its terms, except as disclosed in the Registration
Statement, the General Disclosure Package and the Prospectus, and subject to, as to enforceability,
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors rights and to general equity principles; each of
the Agreements to which each shareholder of the PRC Operating Companies is a party has been duly
executed and delivered by each such shareholder; each shareholder of the PRC Operating Companies
had the power and capacity to enter into and perform its obligation thereunder; each of the
Agreements to which such shareholder is a party constitutes the legal, valid and binding
obligations of such shareholder, enforceable against such shareholder in accordance with its terms,
except as disclosed in the Registration Statement, the General Disclosure Package and the
Prospectus, and subject to, as to enforceability, bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to or affecting
creditors rights and to general equity principles.
(xv) The execution and delivery of, and the performance of the respective obligations under
each of the Agreements by each of the PRC Subsidiaries and PRC Operating Companies to which it is a
party and the consummation of the transactions contemplated therein will not: (a) conflict with or
result in a breach or violation of any of the terms or provisions of, or constitute a default
under, any indenture,
6
mortgage, deed of trust, loan agreement or other agreement or instrument
governed by PRC law to which it is a party or by which it or any of its properties or assets are
bound; (b) result in any violation of any provision of its articles of association or other
constituent documents or business license; or (c) result in
any violation of any statute or any order, rule or regulation of any governmental agency
having jurisdiction over the Company or any of the Group Entities or any of their properties or
assets, except, in the case of (a) and (c), such conflict, breach, violation or default that would
not, individually or in the aggregate, result in a Material Adverse Effect; and the execution and
delivery, and the performance of the respective obligations under each Agreements by each
shareholder of the PRC Operating Companies to which it is a party and the consummation of the
transactions contemplated therein, will not result in any violation of PRC law.
(xvi) Each of the Agreements is in proper legal form under the PRC laws for the enforcement
thereof against each of the PRC Subsidiaries, PRC Operating Companies and their respective
shareholders, as the case may be, in the PRC without further action by any of the PRC Subsidiaries,
the PRC Operating Companies or their respective shareholders; no governmental authorizations are
required to be obtained for the performance by any of the PRC Subsidiaries, the PRC Operating
Companies or their respective shareholders of their obligations under the Agreements, or the
consummation of the transactions contemplated under each of the Agreements, other than those
already obtained, except as disclosed in the General Disclosure Package.
(xvii) Except as disclosed in the Registration Statement, the General Disclosure Package and
the Prospectus, neither the Company nor any of the Group Entities has sent or received any written
communication regarding termination of, or intent not to renew, any of the material contracts or
agreements specifically referred to or described in the General Disclosure Package, or specifically
referred to or described in, or filed as an exhibit to, the Registration Statement, and no such
termination or non-renewal has been threatened by the Company, any of the Group Entities or, to the
Companys best knowledge after due inquiry, any other party to any such contract or agreement.
(xviii) There are no statutes, regulations, contracts or other documents that are required to
be described in the Registration Statement, the General Disclosure Package and the Prospectus or to
be filed as exhibits to the Registration Statement that are not described or filed as required.
(xix) The Company has not, directly or indirectly, distributed and will not distribute any
offering materials in connection with the offering and sale of the Offered Securities other than
any Preliminary Prospectus, the Prospectus and other materials, if any, permitted under the Act and
consistent with Section 4(a)(ii) below. The Company will file with the Commission all Issuer Free
Writing Prospectuses in the time required under Rule 433(d) under the Act. The Company has
satisfied or will satisfy the conditions in Rule 433 under the Act to avoid a requirement to file
with the Commission any electronic road show.
(xx) (a) At the time of filing the Registration Statement; and (b) as of the date hereof (with
such date being used as the determination date for purposes of this clause (b)), the Company was
not and is not an ineligible issuer (as defined in Rule 405 under the Act, without taking into
account any determination by the Commission pursuant to Rule 405 under the Act that it is not
necessary that the Company be considered an ineligible issuer), including, without limitation, for
purposes of Rules 164 and 433 under the Act with respect to the offering of the Offered Securities
as contemplated by the Registration Statement.
(xxi) Except as disclosed in the Registration Statement, the General Disclosure Package and
the Prospectus, there are no contracts, agreements or understandings between the Company and any
7
person granting such person the right to require the Company to file a registration statement under
the Act with respect to any securities of the Company owned or to be owned by such person or to
require the Company to include such securities in the securities registered pursuant to a
Registration Statement or in
any securities being registered pursuant to any other registration statement filed by the
Company under the Act (collectively, registration rights).
(xxii) The consolidated financial statements of the Company and the Group Entities, together
with related notes and schedules as set forth in the Registration Statement, the General Disclosure
Package and the Prospectus, present fairly the financial position and the results of operations and
cash flows of the Company and the Group Entities, at the indicated dates and for the indicated
periods. Such financial statements and related schedules have been prepared in accordance
accounting principles generally accepted in the United States (US GAAP), consistently applied
throughout the periods involved, except as disclosed therein, and all adjustments necessary for a
fair presentation of results for such periods have been made. The summary and selected
consolidated financial and statistical data included in the Registration Statement, the General
Disclosure Package and the Prospectus presents fairly the information shown therein and such data
has been compiled on a basis consistent with the financial statements presented therein and the
books and records of the Company. The Company and the Group Entities do not have any material
liabilities or obligations, direct or contingent (including any off-balance sheet obligations or
any variable interest entities within the meaning of Financial Accounting Standards Board
Interpretation No. 46), not disclosed in the Registration Statement, the General Disclosure Package
and the Prospectus. There are no financial statements (historical or pro forma) that are required
to be included in the Registration Statement, the General Disclosure Package or the Prospectus that
are not included as required.
(xxiii) Ernst & Young Hua Ming, who have certified certain of the financial statements filed
with the Commission as part of the Registration Statement, the General Disclosure Package and the
Prospectus, is an independent registered public accounting firm with respect to the Company and the
Group Entities within the meaning of the Act and the applicable Rules and Regulations and the
Public Company Accounting Oversight Board (United States) (the PCAOB).
(xxiv) Except as disclosed in the Registration Statement, the General Disclosure Package and
the Prospectus, the Company is not aware of, and has not publicly disclosed or reported to its
audit committee or board of directors, and within 135 days following the date of this Agreement,
the Company does not expect to publicly disclose or report to its audit committee or board of
directors, a (a) significant deficiency, material weakness in its internal control over financial
reporting, (b) change in internal control over financial reporting or (c) fraud involving
management or other employees who have a significant role in internal control (each, an Internal
Control Event), any violation of, or failure to comply with, the Securities Laws (as defined
below). Securities Laws means, collectively, the Sarbanes-Oxley Act of 2002, as amended, and the
rules and regulations promulgated by the Commission and the New York Stock Exchange (the NYSE)
thereunder (the Sarbanes-Oxley Act), the Act, the Exchange Act, the Rules and Regulations, the
auditing principles, rules, standards and practices applicable to auditors of issuers (as defined
in the Sarbanes-Oxley Act) promulgated or approved by the PCAOB (the PCAOB Rules), and the rules
of the NYSE.
(xxv) Solely to the extent that the Sarbanes-Oxley Act has been applicable to the Company,
there is and has been no failure on the part of the Company to comply in all material respects with
any provision of the Sarbanes-Oxley Act. The Company has taken all necessary actions to ensure
that it is in compliance with all provisions of the Sarbanes-Oxley Act that are in effect and with
which the Company is required to comply and is actively taking steps to ensure that it will be in
compliance with other provisions of the Sarbanes-Oxley Act not currently in effect or which will
become applicable to the Company.
8
(xxvi) Except as described in the General Disclosure Package, no material indebtedness (actual
or contingent) and no material contract or arrangement is outstanding between the Company or any
of the Group Entities and any director or executive officer of the Company or any of the Group
Entities or any person connected with such director or executive officer (including his/her spouse,
infant children, any company or undertaking in which he/she holds a controlling interest).
(xxvii) The section entitled Managements Discussion and Analysis of Financial Condition and
Results of Operations Liquidity and Capital Resources in the General Disclosure Package
accurately and fully describes: (A) all material trends, demands, commitments, events,
uncertainties and risks, and the potential effects thereof, that the Company believes would
materially affect liquidity and are reasonably likely to occur; and (B) all off-balance sheet
transactions, arrangements, and obligations, including, without limitation, relationships with
unconsolidated entities that are contractually limited to narrow activities that facilitate the
transfer of or access to assets by the Company or any of the Group Entities, such as structured
finance entities and special purpose entities (collectively, off-balance sheet arrangements) that
are reasonably likely to have a material effect on the liquidity of the Company or any of the Group
Entities or the availability thereof or the requirements of the Company or any of the Group
Entities for capital resources.
(xxviii) There is no action, suit, claim or proceeding pending or, to the knowledge of the
Company, threatened against the Company or any of the Group Entities, or to which any of the
properties of the Company or any of the Group Entities is subject, before any court or
administrative agency or otherwise, or any contractual dispute ongoing or, to the knowledge of the
Company, threatened against the Company or any of its Group Entities, which if determined or
otherwise resolved adversely to the Company or any of the Group Entities would have a Material
Adverse Effect, except as set forth in the Registration Statement, the General Disclosure Package
and the Prospectus.
(xxix) The Company and the Group Entities have good and marketable title to all of the
properties and assets reflected in the consolidated financial statements hereinabove described or
described in the Registration Statement, the General Disclosure Package and the Prospectus, subject
to no lien, mortgage, pledge, charge or encumbrance of any kind except those reflected in such
financial statements or described in the Registration Statement, the General Disclosure Package and
the Prospectus or which would not materially affect the value thereof or materially interfere with
the use made of, or to be made thereof by them of, such property. The Company and the Group
Entities occupy their leased properties under valid and binding leases, except as would not be
material or would not materially interfere with the use made of such property, in each case except
as described in the Registration Statement, the General Disclosure Package and the Prospectus.
(xxx) The Company and the Group Entities have filed all tax returns that have been required to
be filed or have requested extensions thereof (except in any case where the failure so to file
would not have a Material Adverse Effect); and, except as set forth in the Registration Statement,
the General Disclosure Package and the Prospectus have paid all taxes indicated by such returns and
all assessments, fines or penalties received by them or any of them to the extent that such taxes,
assessments, fines or penalties have become due, except for any such taxes, assessments, fines or
penalties currently being contested in good faith or which would not, individually or in the
aggregate, have a Material Adverse Effect. All tax liabilities (including any liabilities
currently being contested in good faith) have been adequately provided for in the financial
statements of the Company, and the Company does not know of any actual or proposed additional
material tax assessments.
(xxxi) Since the respective dates as of which information is given in the Registration
Statement, the General Disclosure Package and the Prospectus, as each may be amended or
supplemented,
9
there has not been any material adverse change or any development involving a
prospective material adverse change in or affecting the earnings, business, management, properties,
assets, rights, operations,
condition (financial or otherwise), or prospects of the Company and the Group Entities taken
as a whole, whether or not occurring in the ordinary course of business, and there has not been any
material transaction entered into or any material transaction that is probable of being entered
into by the Company or the Group Entities, other than transactions in the ordinary course of
business and changes and transactions described in the Registration Statement, the General
Disclosure Package and the Prospectus, as each may be amended or supplemented. The Company has not
purchased any of its outstanding capital stock, nor declared or paid any dividend other than
ordinary and customary dividends, and there has not been any material changes in the capital stock,
short-term debt or long-term debt of the Company and the Group Entities, other than transactions
described in the Registration Statement, the General Disclosure Package and the Prospectus, as each
may be amended or supplemented. The Company and its subsidiaries have no material contingent
obligations which are not disclosed in the Companys financial statements which are included in the
Registration Statement, the General Disclosure Package and the Prospectus.
(xxxii) All dividends and other distributions declared and payable on the Ordinary Shares may
under the current laws and regulations of the Cayman Islands be paid to the Depositary, and all
such dividends and other distributions will not be subject to withholding or other taxes under the
laws and regulations of the Cayman Islands and are otherwise free and clear of any other tax,
withholding or deduction in the Cayman Islands and without the necessity of obtaining any consents,
approvals, authorizations, orders, registrations, clearances or qualifications of or with any court
or Governmental Agency having jurisdiction over the Company or any of the Group Entities or any of
their respective properties (hereinafter referred to as Governmental Authorizations) in the
Cayman Islands.
(xxxiii) All dividends and other distributions declared and payable on the share capital of
Selovo and Pendiary may under the current laws and regulations of British Virgin Islands be paid to
their shareholders, the Company, and all such dividends and other distributions will not be subject
to withholding or other taxes under the laws and regulations of the British Virgin Islands and are
otherwise free and clear of any other tax, withholding or deduction in the British Virgin Islands
and without the necessity of obtaining any Governmental Authorization in the British Virgin
Islands.
(xxxiv) All dividends and other distributions declared and payable on the share capital of Max
Impact, Bravo and China Index may under the current laws and regulations of Hong Kong be paid to
their shareholders, the Company, Selovo or Pendiary, as the case may be, and all such dividends and
other distributions will not be subject to withholding or other taxes under the laws and
regulations of Hong Kong and are otherwise free and clear of any other tax, withholding or
deduction in Hong Kong and without the necessity of obtaining any Governmental Authorization in
Hong Kong.
(xxxv) Except as described in the General Disclosure Package, all dividends and other
distributions declared and payable on the share capital of any of the PRC Subsidiaries may under
the current laws and regulations of the PRC be freely transferred out of the PRC and may be paid in
U.S. dollars, and all such dividends and other distributions will not be subject to withholding or
other taxes under the laws and regulations of the PRC and are otherwise free and clear of any other
tax, withholding or deduction in the PRC, and without the necessity of obtaining any Governmental
Authorization in the PRC.
(xxxvi) No stamp or other issuance or transfer taxes or duties and no capital gains, income,
withholding or other taxes are payable by or on behalf of the Underwriters to the government of the
PRC, the Cayman Islands, the British Virgin Islands, Hong Kong or any political subdivision or
taxing authority thereof or therein in connection with: (A) the issuance, sale and delivery of the
Offered Shares and Offered Securities by the Company and the Selling Shareholders to or for the
respective accounts of
10
the several Underwriters or (B) the sale and delivery by the Underwriters of
the Offered Shares and Offered Securities to the initial purchasers thereof in the manner
contemplated by this Agreement.
(xxxvii) Neither the Company nor any of the Group Entities is or with the giving of notice or
lapse of time or both, will be, (a) in violation of its certificate or articles of incorporation,
by-laws, memorandum of association, articles of association, certificate of formation, limited
liability agreement, partnership agreement or other organizational documents or (b) in violation of
or in default under any agreement, lease, contract, indenture or other instrument or obligation to
which it is a party, by which it, or any of its properties, is bound, or to which any of its
properties is subject, and, solely with respect to this clause (b), which violation or default
would have a Material Adverse Effect.
(xxxviii) The execution and delivery of this Agreement and the consummation of the
transactions herein contemplated and the fulfillment of the terms hereof will not conflict with or
result in a breach of any of the terms or provisions of, or constitute a default under, (a) any
indenture, mortgage, deed of trust or other agreement or instrument to which the Company or any
Group Entity is a party or by which the Company or any Group Entity or any of their respective
properties is bound, (b) of the articles of incorporation or by-laws of the Company or (c)
otherwise contravene any law, order, rule or regulation judgment, order, writ or decree applicable
to the Company or any Group Entity of any court or of any government, regulatory body or
administrative agency or other governmental body having jurisdiction, except in the case of (a) and
(c), those that would not, individually or in the aggregate, have a Material Adverse Effect.
(xxxix) The execution and delivery of, and the performance by the Company of its obligations
under, this Agreement has been duly and validly authorized by all necessary corporate action on the
part of the Company, and this Agreement has been duly executed and delivered by the Company.
(xl) The deposit agreement (the Deposit Agreement) has been duly authorized by the Company
and, when duly executed and delivered by the Company, and, assuming the Depositary has satisfied
those legal requirements that are applicable to it to the extent necessary to make the Deposit Agreement enforceable against it, will under the applicable laws of the United States and the
Cayman Islands constitute a valid, binding and enforceable agreement of the Company, except as such
enforceability may be limited by applicable bankruptcy, insolvency, moratorium and other similar
laws affecting the rights of creditors generally and the application of general equitable
principles, and, assuming the accuracy and compliance with the representations, warranties and
covenants made by the Company and the Selling Shareholders herein, upon issuance by the Depositary
of ADSs against the deposit of the Firm Shares and the Option Shares in respect thereof in
accordance with the provisions of the Deposit Agreement, such ADSs will be duly and validly issued
and the persons in whose names the ADSs are registered will be entitled to the rights specified
therein and in the Deposit Agreement free and clear of all liens, encumbrances or claims and will
be freely transferable to or for the account of the several Underwriters and (to the extent
described in the General Disclosure Package) the initial purchasers thereof; and there are no
restrictions on subsequent transfers of the ADSs under the laws of the Cayman Islands, the PRC or
the United States except as described in the General Disclosure Package under the captions
Description of Share Capital, Description of American Depositary Shares and Shares Eligible
for Future Sale; and the Deposit Agreement and the ADSs conform in all material respects to the
descriptions thereof contained in the Registration Statement, General Disclosure Package and the
Prospectus.
(xli) The custodian agreement between each Selling Shareholder (except for Telstra) and the
Company (the Custodian Agreement) has been duly authorized by the Company and, when duly executed
and delivered by the Company, and, assuming the Custodian has satisfied those legal requirements
that are applicable to it to the extent necessary to make the Custodian Agreement enforceable
11
against it, will under the applicable laws of the United States and the Cayman Islands constitute a
valid, binding and enforceable agreement of the Company, except as such enforceability may be
limited by
applicable bankruptcy, insolvency, moratorium and other similar laws affecting the rights of
creditors generally and the application of general equitable principles.
(xlii) Each approval, consent, order, authorization, designation, declaration or filing by or
with any regulatory, administrative or other governmental body necessary in connection with the
execution and delivery by the Company of this Agreement and the Deposit Agreement and the
consummation of the transactions herein and therein contemplated has been obtained or made and is
in full force and effect (except such additional steps as may be required by the Commission or the
Financial Industry Regulatory Authority (the FINRA) or such additional steps as may be necessary
to qualify the Offered Securities for public offering by the Underwriters under state securities or
Blue Sky laws or such consents the absence of which would not, individually or in the aggregate,
have a Material Adverse Effect).
(xliii) Except as disclosed in the Registration Statement, the General Disclosure Package and
the Prospectus, the Company and each of the Group Entities hold all material licenses, certificates
and permits from governmental authorities which are necessary to the conduct of their businesses,
and neither the Company nor any of the Group Entities has received any notice of proceedings
related to the revocation or modification of any such license, certificate or permit, which,
individually or in the aggregate, if the subject of an unfavorable decision, ruling or finding
would have a Material Adverse Effect.
(xliv) Except as described in the Registration Statement, General Disclosure Package and the
Prospectus, the Company and the Group Entities each own or possess the right to use all patents,
patent rights, trademarks, trade names, service marks, service names, copyrights, license rights,
know-how (including trade secrets and other unpatented and unpatentable proprietary or confidential
information, systems or procedures) and other intellectual property rights (collectively,
Intellectual Property) necessary to or material to carry on their business; neither the Company
nor any of the Group Entities has infringed, and none of the Company or the Group Entities have
received notice of conflict with, any Intellectual Property of any other person or entity. There
are no outstanding options, licenses or agreements of any kind relating to the Intellectual
Property of the Company or the Group Entities that are required to be described in the Registration
Statement, the General Disclosure Package and the Prospectus and are not described in all material
respects. Neither the Company nor any Group Entity is party to or bound by any options, licenses
or agreements with respect to the Intellectual Property of any other person or entity that are
required to be set forth in the Prospectus and are not described in all material respects. None of
the technology employed by the Company or the Group Entities has been obtained or is being used by
the Company or the Group Entities in violation of any contractual obligation binding on the
Company, the Group Entities or any of their officers, directors or employees or otherwise in
violation of the rights of any persons; none of the Company or any Group Entity has received any
written or oral communications alleging that the Company has violated, infringed or conflicted
with, or, by conducting its business as set forth in the Registration Statement, the General
Disclosure Package and the Prospectus, would violate, infringe or conflict with, any of the
Intellectual Property of any other person or entity. The Company knows of no infringement by
others of Intellectual Property owned by or licensed to the Company or the Group Entities, except
for such infringement that would not, individually or in the aggregate, have a Material Adverse
Effect.
(xlv) Neither the Company, nor to the Companys knowledge, any of its affiliates, has taken or
may take, directly or indirectly, any action designed to cause or result in, or which has
constituted or which might reasonably be expected to constitute, the stabilization or manipulation
of the price of the ADSs to facilitate the sale or resale of the ADSs.
12
(xlvi) The Company does not believe that it was a passive foreign investment company (PFIC)
within the meaning of Section 1297(a) of the United States Internal Revenue Code of 1986, as
amended, for the taxable year ended December 31, 2009, does not expect to be a PFIC in the current
taxable year ending December 31, 2010. The Company will use reasonable best efforts not to take
any action that would result in the Company becoming a PFIC during 2010 or in the future.
(xlvii) The Company has not sold, issued or distributed any Ordinary Shares during the
six-month period preceding the date hereof, including any sales pursuant to Rule 144A, Regulation D
or Regulation S promulgated under the Act, other than Ordinary Shares issued pursuant to employee
benefit plans, qualified share option plans or other employee compensation plans or pursuant to
outstanding options, rights or warrants.
(xlviii) The Company is a foreign private issuer within the meaning of Rule 405 under the
Act.
(xlix) The Company is not, and after giving effect to the offering and sale of the Offered
Securities contemplated hereunder and the application of the net proceeds from such sale as
described in the Registration Statement, the General Disclosure Package and the Prospectus, will
not be required to register as an investment company within the meaning of such term under the
Investment Company Act of 1940 as amended (the 1940 Act), and the rules and regulations of the
Commission thereunder.
(l) Except as disclosed in the Registration Statement, General Disclosure Package and the
Prospectus, the Company maintains a system of internal accounting controls (as defined in the
Commissions regulations) sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with managements general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in conformity with GAAP and to
maintain accountability for assets; (iii) access to assets is permitted only in accordance with
managements general or specific authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is taken with respect
to any differences.
(li) Except as disclosed in the Registration Statement, General Disclosure Package and the
Prospectus, the Company has established and maintains disclosure controls and procedures (as
defined in Rules 13a-14(c) and 15d-14(c) under the Exchange Act); the Companys disclosure
controls and procedures are reasonably designed to ensure that all information (both financial and
non-financial) required to be disclosed by the Company in the reports that it files or submits
under the Exchange Act is recorded, processed, summarized and reported within the time periods
specified in the rules and regulations of the Exchange Act, and that all such information is
accumulated and communicated to the Companys management as appropriate to allow timely decisions
regarding required disclosure.
(lii) The statistical, industry-related and market-related data included in the Registration
Statement, the General Disclosure Package and the Prospectus are based on or derived from sources
which the Company reasonably and in good faith believes are reliable and accurate, and such data
agree with the sources from which they are derived. The respective reports prepared by CR-Nielsen
and Data Center of China Internet were prepared at our request based on a contractual arrangement
which the Company negotiated on an arms-length basis and such reports present the market in a
manner similar to the way a report might have been prepared by an organization knowledgeable in the
industry, but not retained by a market participant.
(liii) Except as disclosed in the Registration Statement, the General Disclosure Package and
the Prospectus, the Company and each of the Group Entities carry, or are covered by, insurance by
13
insurers of recognized financial responsibility in such amounts and covering such risks as is
adequate for the conduct of their respective businesses and as is prudent and customary for
companies engaged in similar businesses.
(liv) To the Companys knowledge, there are no affiliations or associations between any member
of FINRA and any of the Companys officers, directors or 5% or greater securityholders, except as
set forth in the Registration Statement; and there are no contracts, agreements or understandings
between the Company and any person that would give rise to a valid claim against the Company or any
Underwriter for a brokerage commission, finders fee or other like payment in connection with the
issuance and sale of the Offered Securities.
(lv) Except as described in the Registration Statement, General Disclosure Package and the
Prospectus, neither the Company nor any of the Group Entities is in violation of any statute, rule,
regulation, decision or order of any governmental agency or body or any court, domestic or foreign,
relating to the use, disposal or release of hazardous or toxic substances or relating to the
protection or restoration of the environment or human exposure to hazardous or toxic substances
(collectively, Environmental Laws), owns or operates any real property contaminated with any
substance that is subject to Environmental Laws, is liable for any costs pursuant to any
Environmental Laws (including in connection with off-site disposal or contamination), or is subject
to any claim relating to any environmental laws, which violation, contamination, liability, cost or
claim would, individually or in the aggregate, have a Material Adverse Effect; and the Company is
not aware of any pending investigation which might lead to such a claim.
(lvi) The ADSs have been approved for listing subject to notice of issuance on the NYSE.
(lvii) There are no relationships or related-party transactions involving the Company or any
of the Group Entities or any other person required to be described in the Prospectus which have not
been described as required.
(lviii) Neither the Company nor any of its subsidiaries, nor any director or officer of the
Company or any of the Group Entities, nor, to the knowledge of the Company, any agent, employee or
affiliate of it or any of its subsidiaries (a) is aware of or has taken any action, directly or
indirectly, that would result in a violation by such persons of the FCPA or any law, rule or
regulation promulgated to implement the OECD Convention on Combating Bribery of Foreign Public
Officials in International Business Transactions, signed December 17, 1997, or any other law, rule
or regulation of similar purpose and scope, including, without limitation, making use of the mails
or any means or instrumentality of interstate commerce corruptly in furtherance of an offer,
payment, promise to pay or authorization of the payment of any money, or other property, gift,
promise to give, or authorization of the giving of anything of value to any foreign official or
any foreign political party or official thereof of any candidate for any foreign office or any
candidate for foreign political office, in contravention of the FCPA and the Company, its
subsidiaries and, to the knowledge of the Company, its affiliates have conducted their businesses
in compliance with the FCPA and have instituted and maintain policies and procedures designed to
ensure, and which are reasonably expected to continue to ensure, continued compliance therewith,
and (b) is aware of or has made any contribution or other payment to any official of, or candidate
for, any federal or state office in violation of any law which violation is required to be
disclosed in the Registration Statement. FCPA means the Foreign Corrupt Practices Act of 1977,
as amended, and the rules and regulations thereunder. The operations of the Company and the
Subsidiaries are and have been conducted at all times in compliance with applicable financial
record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of
1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations
thereunder and any related or similar rules, regulations or guidelines,
14
issued, administered or enforced by any governmental agency and any Executive order,
directive, or regulation pursuant to the authority thereof, or any orders or licenses issued
thereunder (collectively, Money Laundering Laws) and no action, suit or proceeding by or before
any court or governmental agency, authority or body or any arbitrator involving the Company or any
of the Group Entities with respect to the Money Laundering Laws is pending or, to the best
knowledge of the Company, threatened.
(lix) Except as set forth in the Registration Statement, neither the Company nor any of the
Group Entities, nor any director or officer of the Company or any of the Group Entities, nor, to
the knowledge of the Company, any agent, employee or affiliate of it or any of its subsidiaries has
taken any action, directly or indirectly, that would result in a violation by such persons of laws
and regulations imposing U.S. economic sanctions measures, including, but not limited to, any
sanctions administered by the U.S. Office of Foreign Assets Control of the U.S. Treasury Department
(OFAC) (including but not limited to the designation as a specially designated national or
blocked person thereunder), Her Majestys Treasury, the European Union, and the Office of Export
Enforcement of the U.S. Department of Commerce (OEE), and any sanctions measures under the
International Emergency Economic Powers Act, the Trading with the Enemy Act, the United Nations
Participation Act, and the Syria Accountability and Lebanese Sovereignty Act, all as amended, and
any executive order, directive, or regulation pursuant to the authority of any of the foregoing,
including the regulations of the United States Treasury Department set forth under 31 CFR, Subtitle
B, Chapter V, as amended, or any orders or licenses issued thereunder.
(lx) Each of the Company and each of the Companys directors that signed the Registration
Statement is aware of and has been advised as to, the content of the Regulations on Mergers and
Acquisitions of Domestic Enterprises by Foreign Investors (the M&A Rules) jointly adopted by six
PRC regulatory agencies, namely, the PRC Ministry of Commerce, the State Assets Supervision and
Administration Commission, the State Administration for Taxation, the State Administration for
Industry and Commerce, the China Securities Regulatory Commission (the CSRC), and the State
Administration of Foreign Exchange, and which became effective on September 8, 2006 M&A Rules, in
particular the relevant provisions thereof which purport to require offshore special purpose
vehicles, or SPVs, formed for listing purposes and controlled directly or indirectly by PRC
companies or individuals, to obtain the approval of the CSRC prior to the listing and trading of
their securities on an overseas stock exchange; the Company has received legal advice specifically
with respect to the M&A Rules from its PRC counsel and the Company understands such legal advice;
and the Company has fully communicated such legal advice from its PRC counsel to each of its
directors that signed the Registration Statement and each director has confirmed that he or she
understands such legal advice; each director of the Company that signed the Registration Statement
has received legal advice to his or her satisfaction with respect to the M&A Rules and his or her
fiduciary duties as a director of the Company in respect of the M&A Rules from his or her PRC legal
counsel or has declined to obtain such advice after being offered by the Company for the Company to
bear the cost of any such advice; the Company and each director of the Company that signed the
Registration Statement understands the potential personal liability to which each director of the
Company that signed the Registration Statement and the executive officers of the Company may be
subject in the event that the issuance, offering and sale of the Offered Securities as contemplated
in this Agreement or the listing and trading of the ADSs on the NYSE were deemed not to be in
compliance with the M&A Rules.
(lxi) The issuance and sale of the Offered Securities, the listing and trading of the ADSs on
the NYSE or the consummation of the transactions contemplated by this Agreement, the Deposit
Agreement is not and will not be, as of the date hereof or at each Closing Date (as defined
herein), adversely affected by the M&A Rules or any official clarifications, guidance,
interpretations or implemen-
15
tation rules in connection with or related to the M&A Rules (collectively, the M&A Rules and
Related Clarifications).
(lxii) As of the date of the Statutory Prospectus contained in the General Disclosure Package
and as of the date hereof, the M&A Rules did not and do not apply to the issuance and sale of the
Offered Securities, the listing and trading of the ADSs on the NYSE, or the consummation of the
transactions contemplated by this Agreement and the Deposit Agreement.
(lxiii) Each of the Company and the Group Entities that were incorporated outside of the PRC
has taken, or is in the process of taking, reasonable steps to comply with, and to ensure
compliance by each of its shareholders, option holders, directors, officers and employees that is,
or is directly or indirectly owned or controlled by, a PRC resident or citizen with any applicable
rules and regulations of the relevant PRC government agencies (including but not limited to the
Ministry of Commerce, the National Development and Reform Commission and the State Administration
of Foreign Exchange) relating to overseas investment by PRC residents and citizens or the
repatriation of the proceeds from overseas offering and listing by offshore special purpose
vehicles controlled directly or indirectly by PRC companies and individuals, such as the Company
(the PRC Overseas Investment and Listing Regulations), including without limitation, requesting
each shareholder, option holder, director, officer and employee that is, or is directly or
indirectly owned or controlled by, a PRC resident or citizen to complete any registration and other
procedures required under applicable PRC Overseas Investment and Listing Regulations.
(lxiv) No labor dispute with the employees of the Company or any of the Group Entities exists
or, to the knowledge of the Company, is imminent, that could reasonably be expected to have a
Material Adverse Effect.
(lxv) Except as disclosed in the Registration Statement, the General Disclosure Package and
the Prospectus, under the laws of the Cayman Islands and the British Virgin Islands, the courts of
the Cayman Islands and British Virgin Islands will recognize and give effect to the choice of law
provisions set forth in Section 8(f) hereof and enforce judgments of U.S. courts obtained against
the Company to enforce this Agreement; under the laws of the PRC, the choice of law provisions set
forth in Section 8(f) hereof will be recognized by the courts of the PRC and any judgment obtained
in any state or federal court located in the Borough of Manhattan, The City of New York, New York
(each, a New York Court) arising out of or in relation to the obligations of the Company under
this Agreement will be recognized in PRC courts subject to the applicable provisions of the Civil
Procedure Law of the PRC relating to the enforceability of foreign judgments.
(lxvi) Except as described in the Registration Statement, General Disclosure Package and the
Prospectus, the Company has not sold, issued or distributed any Ordinary Shares during the
six-month period preceding the date hereof, including any sale pursuant to Rule 144A, Regulation D
or Regulation S under the Act, other than Ordinary Shares issued pursuant to share option plans,
employee compensation plans or pursuant to outstanding options, rights or warrants.
(lxvii) The Company has taken all reasonable steps to comply with, and to ensure compliance by
all of the Companys shareholders and prior holders who are PRC residents or PRC citizens with any
applicable rules and regulations of the State Administration of Foreign Exchange (the SAFE Rules
and Regulations), including without limitation, taking reasonable steps to require each of its
shareholders and option holders that is, or is directly or indirectly owned or controlled by, a PRC
resident or PRC citizen to complete any registration and other procedures required under applicable
SAFE Rules and Regulations.
16
(lxviii) Each forward-looking statement (within the meaning of Section 27A of the Act or
Section 21E of the Exchange Act) contained in the Registration Statement, each Preliminary
Prospectus, the General Disclosure Package, the Prospectus and each Issuer Free Writing Prospectus,
if any, has been made or reaffirmed with a reasonable basis and in good faith.
(lxix) To the best of the Companys knowledge after due inquiry, the sale of Ordinary Shares
by Telstra to General Atlantic Mauritius Limited, Hunt 7-A Guernsey L.P. Inc, Hunt 7-B Guernsey
Inc. and Hunt 6-A Guernsey L.P. Inc., and Next Decade (collectively, the Private Placement
Purchasers) pursuant to a Share Purchase Agreement dated as of August 13, 2010 (the Private
Placement) was conducted in accordance with Regulation S under the Securities Act or pursuant to
an exemption from registration under the Act, and all requirements of Regulation S or of such
exemption were duly complied with by the Company, Telstra and Private Placement Purchasers.
(lxx) Assuming the truth and accuracy of the representations and warranties of Telstra and the
Private Placement Purchasers under the Share Purchase Agreement dated as of August 13, 2010, the
Private Placement will not be integrated with the offering of Offered Securities hereunder pursuant
to applicable rules and regulations issued under the Act.
(b) Each of the Selling Shareholders (other than as indicated below) severally and not jointly
represents and warrants as follows:
(i) Such Selling Shareholder has been duly organized and is validly existing as a company or a
limited partnership, as the case may be, in good standing (where applicable) in its jurisdiction of
organization. Such Selling Shareholder now has, and at the Closing Date and the Option Closing
Date, as the case may be (as such dates are hereinafter defined), will have, good and valid title
to the Ordinary Shares to be deposited with the Depositary against issuance of the ADSs to be sold
by such Selling Shareholder hereunder, free and clear of all liens, encumbrances, equities or
claims. Assuming the Deposit Agreement has been duly authorized and delivered by the parties
thereto, the ADSs so delivered by such Selling Shareholder will be freely transferable by such
Selling Shareholder to or for the account of the several Underwriters and (to the extent described
in the Prospectus) the initial purchasers thereof; and there are no restrictions on subsequent
transfers of the Ordinary Shares or ADSs under the applicable laws of the Cayman Islands, the PRC
or the United States, except as described in the Prospectus under the captions Description of
American Depositary Shares, Description of Share Capital or Shares Eligible for Future Sale.
(ii) Such Selling Shareholder has full right, power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. This Agreement has been duly authorized,
executed and delivered by or on behalf of such Selling Shareholder and is a valid and binding
agreement of such Selling Shareholder, enforceable against such Selling Shareholder in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws of general applicability relating to or affecting creditors
rights and to general equitable principles. The execution and delivery of this Agreement and the
consummation by such Selling Shareholder of the transactions herein contemplated and the
fulfillment by such Selling Shareholder of the terms hereof will not require any consent, approval,
authorization, or other order of, or qualification with, any court, regulatory body, administrative
agency or other governmental body for the performance by the respective Selling Shareholder of its
obligations under such Agreement (except as may be required under the Act by the Commission, by
FINRA and as may be required under the securities laws of various U.S. States (or Blue Sky laws) or
foreign jurisdictions, such consents that have already been obtained or such consents the absence
of which would not, individually or in the aggregate, have a material adverse effect on the ability
of such Selling Shareholder to consummate the transactions contemplated hereby).
17
(iii) The execution and delivery of this Agreement by such Selling Shareholder and the
consummation of the transactions herein contemplated and the fulfillment of the terms hereof will
not conflict with or result in a breach of any of the terms or provisions of, or constitute a
default under, (a) the certificate, articles of incorporation, by-laws or similar organizational
documents of such Selling Shareholder, (b) any other agreement or instrument binding upon such
Selling Shareholder or any judgment, order, writ or decree applicable to such Selling Shareholder
of any court or of any government, regulatory body or administrative agency or other governmental
body having jurisdiction over such Selling Shareholder, or (c) otherwise contravene any provision
of applicable law, except in the case of (b) and (c) as would not, individually or in the
aggregate, prevent the consummation by the Selling Shareholder of the transactions contemplated
hereby.
(iv) Such Selling Shareholder has not taken and will not take, directly or indirectly, any
action designed to, or which has constituted, or which might reasonably be expected to cause or
result in the stabilization or manipulation of the price of the Offered Securities of the Company
and, other than as permitted by the Act, the respective Selling Shareholder will not distribute any
prospectus or other offering material in connection with the offering of the Offered Securities.
(v) Other than Telstra, which makes no representation or warranty as to any matter addressed
in this paragraph, the questionnaire containing certain information regarding such Selling
Shareholder and the election form which sets forth the amount of Shares such Selling Shareholder
has elected to sell in the Offering (the Questionnaire and Election Form), completed by such
Selling Shareholder and submitted to the Company by facsimile on or before August 6, 2010 does not
and as of each Closing Date will not contain any untrue statement of material fact nor does it omit
to state any material fact required to be stated therein or necessary to make the statements
therein not misleading and such Selling Shareholders election to sell the number of Shares
indicated in the Election Form is valid and binding on such Selling Shareholder.
(vi) Except as disclosed in the Registration Statement, General Disclosure Package or the
Prospectus, no consent, approval or waiver is required under any instrument or agreement to which
such Selling Shareholder is a party or by which such Selling Shareholder is bound or under which it
is entitled to any right or benefit, in connection with the offering, sale or purchase by the
Underwriters of any of the Firm Shares which may be sold by such Selling Shareholder under this
Agreement or the consummation by such Selling Stockholder of any of the other transactions
contemplated hereby;
(vii) There are no affiliations or associations between any of the Underwriters and such
Selling Shareholder or any affiliate of such Selling Shareholder, except as set forth in the
Registration Statement.
(viii) Other than Telstra, which makes no representation or warranty as to any matter
addressed in this paragraph, each Selling Shareholder has deposited, or will deposit on or prior to
the Closing Date (as defined below), the Firm Shares with the Depositary against the issuance of
the ADSs to be sold by it to the Underwriters and has instructed or will instruct the Depositary to
deliver such ADSs to the Underwriters against payment by the Underwriters therefor at the Closing
Date (as defined below).
(ix) No stamp or other issuance or transfer taxes or duties or similar taxes are payable in
the United States or the Cayman Islands by or on behalf of the Underwriters, the Company, or the
purchasers of the Offered Securities to any taxing authority thereof or therein in connection with
(i) the sale and delivery of Firm Shares and Option Shares by each Selling Shareholder, in
accordance with the terms of this Agreement and as described in the Registration Statement, the
General Disclosure Package
18
and the Prospectus or (ii) the sale and delivery by the Underwriters of Offered Securities to
the initial purchasers thereof in accordance with the terms of this Agreement.
(x) Such Selling Shareholder has not, prior to the execution of this Agreement, offered or
sold any Shares by means of any prospectus (within the meaning of the Act), or used any
prospectus (within the meaning of the Act) in connection with the Offering, in each case other
than the then most recent Preliminary Prospectus.
(xi) Such Selling Shareholder has reviewed the Registration Statement, the General Disclosure
Package and the Prospectus, and none of the information furnished to the Company by such Selling
Shareholder in writing expressly for use in the Registration Statement, as of its effective time,
the General Disclosure Package, as of the Applicable Time, any individual Limited Use Free Writing
Prospectus, when considered together with the General Disclosure Package, includes any untrue
statement of a material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however, that such Selling
Shareholder makes no representation or warranty as to information contained in or omitted from any
Issuer Free Writing Prospectus, in reliance upon, and in conformity with, written information
furnished to the Company by or on behalf of any Underwriter through the Representatives,
specifically for use therein, it being understood and agreed that the only such information is that
described in Section 13 herein.
(xii) The sale of the Firm ADSs and the Option ADSs by such Selling Shareholder pursuant
hereto is not prompted by any material information concerning the Company or any of the Group
Entities which is not set forth in the Registration Statement, the General Disclosure Package and
the Prospectus.
(xiii) The Offered Securities to be sold by such Selling Shareholder, when issued and
delivered against payment therefor, will be freely transferable by the Selling Shareholders to or
for the account of the several Underwriters and (to the extent described in the Prospectus) the
initial applicable purchasers thereof; and there are no restrictions on subsequent transfers of
such Offered Securities under the laws of the PRC, the Cayman Islands, the British Virgin Islands,
Hong Kong or the United States except as described in the General Disclosure Package under the
captions Description of Share Capital, Description of American Depositary Shares, Shares
Eligible for Future Sale and Underwriting.
(xiv) The Selling Shareholder and any of its direct or indirect owners or controlling persons,
that is a PRC resident or PRC citizen is in compliance with any applicable SAFE Rules and
Regulations, including without limitation, having completed or being in the process of completing
any registration and other procedures required under applicable SAFE Rules and Regulations.
(xv) Neither such Selling Shareholder nor any director of the Company who is an employee of
such Selling Shareholder, nor, to the knowledge of such Selling Shareholder, any employee or
controlled affiliate of such Selling Shareholder (which for the avoidance of doubt shall not be
deemed to include the Company, and of the Group Entities or any shareholder of the Company other
than such Selling Shareholder) has taken any action, directly or indirectly, that would result in a
violation by such persons of laws and regulations imposing U.S. economic sanctions measures,
including, but not limited to, any sanctions administered by the U.S. Office of Foreign Assets
Control of the U.S. Treasury Department (OFAC) and the Office of Export Enforcement of the U.S.
Department of Commerce (OEE), and any sanctions measures under the International Emergency
Economic Powers Act, the Trading with the Enemy Act, the United Nations Participation Act, and the
Syria Accountability and Lebanese Sovereignty Act, all as amended, and any executive order,
directive, or regulation pursuant to the authority of any of the foregoing, including the
regulations of the United States Treasury Department set forth under 31 CFR, Subtitle B, Chapter V,
as amended, or any orders or licenses issued thereunder; and such Selling
19
Shareholder will not directly or indirectly use the proceeds of the offering, or lend,
contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or
other person or entity, for the purpose of financing the activities of any person currently subject
to any U.S. sanctions administered by OFAC or the OEE or for the purpose of financing any activity
that is prohibited as to U.S. persons under U.S. sanctions administered by OFAC or the OEE.
(xvi) With respect to Telstra, concerning which the Selling Shareholders other than Telstra
make no representation or warranty as to any matter addressed in this paragraph, no registration
under the Act is required for the offer and sale of the Ordinary Shares by Telstra to the Private
Placement Purchasers, pursuant to a Share Purchase Agreement dated as of August 13, 2010.
2.
Purchase and Sale with respect to the Firm Shares.
(a) On the basis of the representations, warranties and covenants herein contained,
and subject to the conditions herein set forth, the Company agrees to sell to the Underwriter []
Firm Shares and each of the Selling Shareholders, severally and not jointly, agrees to sell to the
Underwriters the number of Firm Shares set forth opposite the name of such Selling Shareholder in
Schedule II hereof, and each Underwriter agrees, severally and not jointly, to purchase, at a price
of $[] per ADS, the number of Firm ADSs set forth opposite the name of each Underwriter in
Schedule I hereof, subject to adjustments in accordance with Section 9 hereof. The number of Firm
ADSs to be purchased by each Underwriter from each Selling Shareholder shall be as nearly as
practicable in the same proportion to the total number of Firm ADSs being sold by each Selling
Shareholder as the number of Firm ADSs being purchased by each Underwriter bears to the total
number of Firm ADSs to be sold hereunder. The obligations of each of the Selling Shareholders
shall be several and not joint.
(b) Other than Telstra, which makes no representation or warranty as to any matter
addressed in this paragraph, certificates in negotiable form for the total number of the Shares
underlying the total number of ADSs to be sold hereunder by the Selling Shareholders have been
placed in custody with the Company as custodian (the Custodian) pursuant to the Custodian
Agreement executed by each Selling Shareholder for delivery of all Firm ADSs and any Option ADSs to
be sold hereunder by the Selling Shareholders. Each of the Selling Shareholders
specifically agrees that the Firm ADSs and any Option ADSs represented by the certificates held in
custody for the Selling Shareholders under the Custodian Agreement are subject to the interests of
the Underwriters hereunder, that the arrangements made by the Selling Shareholders for such custody
are to that extent irrevocable, and that the obligations of the Selling Shareholders hereunder
shall not be terminable by any act or deed of the Selling Shareholders (or by any other person,
firm or corporation including the Company, the Custodian or the Underwriters) or by operation of
law (including the death of an individual Selling Shareholder or the dissolution of a corporate
Selling Shareholder) or by the occurrence of any other event or events, except as set forth in the
Custodian Agreement. If any such event should occur prior to the delivery to the Underwriters of
the Firm ADSs or the Option ADSs hereunder, certificates for the Firm Shares underlying the Firm
ADSs or the Options Shares underlying the Option ADSs, as the case may be, shall be delivered by
the Custodian in accordance with the terms and conditions of this Agreement as if such event has
not occurred. The Custodian is authorized to receive and acknowledge receipt of the proceeds of
sale of the ADSs representing the Shares held by it against delivery of such ADSs.
(c) Payment for the Firm ADSs to be sold hereunder is to be made in Federal (same day) funds
to(x) an account designated by the Company for the ADSs to be sold by it, (x) an account designated
by Telstra for the Firm ADSs to be sold by it and (y) to an account designated by the Custodian for
the Firm ADSs to be sold by the Selling Shareholders (other than Telstra), in each case against
delivery of certificates therefor to the Representatives for the several accounts of the
Underwriters. Such payment and delivery are to be made through the facilities of The Depository
Trust Company at 10:00 a.m., New York time, on September
20
[], 2010 or at such other time and date not later than five business days thereafter as you
and the Company shall agree upon, such time and date being herein referred to as the Closing
Date. (As used herein, business day means a day on which the NYSE is open for trading and on
which banks in the City of New York, New York are open for business and not permitted by law or
executive order to be closed.) The certificates for the Firm Shares shall be delivered by the
Selling Shareholders, other than Telstra, in such denominations and in such registrations as the
Representatives request in writing not later than the second full business day prior to the Closing
Date, and will be made available for inspection by the Representatives at least one business day
prior to the Closing Date.
(d) In addition, on the basis of the representations and warranties herein contained and
subject to the terms and conditions herein set forth, the Selling Shareholders hereby grant an
option to the several Underwriters to purchase the Option ADSs at the price per ADS as set forth in
Section 2(a) hereof. The maximum number of Option ADSs to be sold by the Selling Shareholders is
set forth opposite their respective names on Schedule II hereto. The option granted hereby may be
exercised in whole or in part by giving written notice (i) at any time before the Closing Date and
(ii) only once thereafter within 30 days after the date of this Agreement, by you, as
Representatives of the several Underwriters, to the Company and Telstra setting forth the number of
Option ADSs as to which the several Underwriters are exercising the option and the time and date at
which such certificates are to be delivered. If the option granted hereby is exercised in part,
the respective number of Option ADSs to be sold by the each of the Selling Shareholders listed in
Schedule II hereto shall be determined on a pro rata basis in accordance with the percentages set
forth opposite their names on Schedule II hereto, adjusted by you in such manner as to avoid
fractional shares or fractional ADSs. The time and date at which certificates for Option ADSs are
to be delivered shall be determined by the Representatives but shall not be earlier than three nor
later than 10 full business days after the exercise of such option, nor in any event prior to the
Closing Date (such time and date being herein referred to as the Option Closing Date). If the
date of exercise of the option is three or more days before the Closing Date, the notice of
exercise shall set the Closing Date as the Option Closing Date. The number of Option ADSs to be
purchased by each Underwriter shall be in the same proportion to the total number of Option Shares
being purchased as the number of Firm ADSs being purchased by such Underwriter bears to the total
number of Firm ADSs, adjusted by you in such manner as to avoid fractional Ordinary Shares or
fractional ADSs. The option with respect to the Option ADSs granted hereunder may be exercised
only to cover over-allotments in the sale of the Firm ADSs by the Underwriters. You, as
Representatives of the several Underwriters, may cancel such option at any time prior to its
expiration by giving written notice of such cancellation to the Company, Telstra and the
Attorney-in-Fact. To the extent, if any, that the option is exercised, payment for the Option ADSs
shall be made on the Option Closing Date in Federal (same day) funds drawn to the order of Telstra
for the Option ADSs to be sold by it against delivery of certificates therefor through the
facilities of The Depository Trust Company, the City of New York, New York.
(e) If on the Closing Date or Option Closing Date, as the case may be, any Selling Shareholder
fails to sell the Firm ADSs or Option ADSs which such Selling Shareholder has agreed to sell on
such date as set forth in Schedule II hereto, the Company agrees that it will sell or arrange for
the sale of that number of ADSs to the Underwriters which represents Firm ADSs or the Option ADSs
which such Selling Shareholder has failed to so sell, as set forth in Schedule II hereto, or such
lesser number as may be requested by the Representatives.
3.
Sale of Offered Securities to Public; Delivery and Payment.
(a) It is understood that the several Underwriters are to make an offering of the Offered
Securities in the manner contemplated in the Registration Statement as soon as the Representatives
deem it advisable to do so. The Offered Securities are to be initially offered to the public in
the United States and
21
outside the United States at the initial public offering price set forth in the Prospectus
(the Offer Price). The Representatives may from time to time thereafter change the Offer Price
and other selling terms.
(b) It is further understood that you will act as the Representatives for the Underwriters in
the offering and sale of the Offered Securities in accordance with the Master Agreement Among
Underwriters entered into by you and the several other Underwriters.
4. Covenants of the Company and the Selling Shareholders.
(a) The Company covenants and agrees with the several Underwriters that:
(i) The Company will (a) prepare and timely file with the Commission under Rule 424(b) under
the Act a Prospectus in a form approved by the Representatives containing information previously
omitted at the time of effectiveness of the Registration Statement in reliance on Rules 430A, 430B
or 430C under the Act, and (b) not file any amendment to the Registration Statement or distribute
an amendment or supplement to the General Disclosure Package or the Prospectus of which the
Representatives shall not previously have been advised and furnished with a copy or to which the
Representatives shall have reasonably objected in writing or which is not in compliance with the
Rules and Regulations.
(ii) The Company will (a) not make any offer relating to the Offered Securities that would
constitute an Issuer Free Writing Prospectus or that would otherwise constitute a free writing
prospectus (as defined in Rule 405 under the Act) required to be filed by the Company with the
Commission under Rule 433 under the Act unless the Representatives approve its use in writing prior
to first use (each, a Permitted Free Writing Prospectus); provided that the prior written consent
of the Representatives hereto shall be deemed to have been given in respect of the Issuer Free
Writing Prospectus(es) included in Schedule III hereto, (b) treat each Permitted Free
Writing Prospectus as an Issuer Free Writing Prospectus, (c) comply with the requirements of Rules
164 and 433 under the Act applicable to any Issuer Free Writing Prospectus, including the
requirements relating to timely filing with the Commission, legending and record keeping and (d)
not take any action that would result in an Underwriter or the Company being required to file with
the Commission pursuant to Rule 433(d) under the Act a free writing prospectus prepared by or on
behalf of such Underwriter that such Underwriter otherwise would not have been required to file
thereunder. The Company will satisfy the conditions in Rule 433 under the Act to avoid a
requirement to file with the Commission any electronic road show.
(iii) The Company will advise the Representatives promptly (a) when the Registration Statement
or any post-effective amendment thereto shall have become effective, (b) of receipt of any comments
from the Commission, (c) of any request of the Commission for amendment of the Registration
Statement or for supplement to the General Disclosure Package or the Prospectus or for any
additional information, and (d) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or any order preventing or suspending the use of any
Preliminary Prospectus, any Issuer Free Writing Prospectus or the Prospectus, or of the institution
of any proceedings for that purpose or pursuant to Section 8A of the Act. The Company will use its
best efforts to prevent the issuance of any such order and to obtain as soon as possible the
lifting thereof, if issued.
(iv) The Company will cooperate with the Representatives in endeavoring to qualify the Offered
Securities for sale under the securities laws of such jurisdictions as the Representatives may
reasonably have designated in writing and will make such applications, file such documents, and
furnish such information as may be reasonably required for that purpose, provided that the Company
shall not be required to qualify as a foreign corporation or to file a general consent to service
of process in any jurisdiction where it is not now so qualified or required to file such a consent.
The Company will, from
22
time to time, prepare and file such statements, reports, and other documents, as are or may be
required to continue such qualifications in effect for so long a period as the Representatives may
reasonably request for distribution of the Offered Securities.
(v) The Company will deliver to, or upon the order of, the Representatives, from time to time,
as many copies of any Preliminary Prospectus as the Representatives may reasonably request. The
Company will deliver to, or upon the order of, the Representatives, from time to time, as many
copies of any Issuer Free Writing Prospectus as the Representatives may reasonably request. The
Company will deliver to, or upon the order of, the Representatives during the period when delivery
of a Prospectus (or, in lieu thereof, the notice referred to under Rule 173(a) under the Act) (the
Prospectus Delivery Period) is required under the Act, as many copies of the Prospectus in final
form, or as thereafter amended or supplemented, as the Representatives may reasonably request. The
Company will deliver to the Representatives at or before the Closing Date, four signed copies of
the Registration Statement and all amendments thereto including all exhibits filed therewith, and
will deliver to the Representatives such number of copies of the Registration Statement (including
such number of copies of the exhibits filed therewith that may reasonably be requested) and of all
amendments thereto, as the Representatives may reasonably request.
(vi) The Company will comply with the Act and the Rules and Regulations, and the Exchange Act,
and the rules and regulations of the Commission thereunder, so as to permit the completion of the
distribution of the Offered Securities as contemplated in this Agreement and the Prospectus. If
during the period in which a prospectus (or, in lieu thereof, the notice referred to under Rule
173(a) under the Act) is required by law to be delivered by an Underwriter or dealer, any event
shall occur as a result of which, in the judgment of the Company or in the reasonable opinion of
the Underwriters, it becomes necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances existing at the time the Prospectus is
delivered to a purchaser, not misleading, or, if it is necessary at any time to amend or supplement
the Prospectus to comply with any law, the Company promptly will prepare and file with the
Commission an appropriate amendment to the Registration Statement or supplement to the Prospectus
so that the Prospectus as so amended or supplemented will not, in the light of the circumstances
when it is so delivered, be misleading, or so that the Prospectus will comply with applicable law.
(vii) If the General Disclosure Package is being used to solicit offers to buy the Offered
Securities at a time when the Prospectus is not yet available to prospective purchasers and any
event shall occur as a result of which, in the judgment of the Company or in the reasonable opinion
of the Underwriters, it becomes necessary to amend or supplement the General Disclosure Package in
order to make the statements therein, in the light of the circumstances, not misleading, or to make
the statements therein not conflict with the information contained in the Registration Statement
then on file, or if it is necessary at any time to amend or supplement the General Disclosure
Package to comply with any law, the Company promptly will prepare, file with the Commission (if
required) and furnish to the Underwriters and any dealers an appropriate amendment or supplement to
the General Disclosure Package so that the General Disclosure Package as so amended or supplemented
will not, in the light of the circumstances, be misleading or conflict with the Registration
Statement then on file, or so that the General Disclosure Package will comply with the law.
(viii) The Company will make generally available to its security holders, as soon as it is
practicable to do so, but in any event not later than 15 months after the effective date of the
Registration Statement, an earnings statement (which need not be audited) in reasonable detail,
covering a period of at least twelve consecutive months beginning after the effective date of the
Registration Statement, which
23
earnings statement shall satisfy the requirements of Section 11(a) of the Act and Rule 158
under the Act and will advise you in writing when such statement has been so made available.
(ix) Prior to the Closing Date, the Company will furnish to the Underwriters, as soon as they
have been prepared by or are available to the Company, a copy of any unaudited interim financial
statements of the Company for any period subsequent to the period covered by the most recent
financial statements appearing in the Registration Statement and the Prospectus.
(x) No offering, sale, short sale or other disposition of any Ordinary Securities of the
Company or other securities convertible into or exchangeable or exercisable for Ordinary Shares or
derivative of Ordinary Shares (or agreement for such) will be made for a period of 180 days after
the date of the Prospectus, directly or indirectly, by the Company otherwise than hereunder or with
the prior written consent of each of the Representatives. Notwithstanding the foregoing, if (a)
during the last 17 days of the 180-day restricted period, the Company issues an earnings release or
material news or a material event relating to the Company occurs; or (b) prior to the expiration of
the 180-day restricted period, the Company announces that it will release earnings results during
the 16-day period following the last day of the 180-day restricted period, then in each case the
restrictions imposed by this Agreement shall continue to apply until the expiration of the 18-day
period beginning on the date of the release of the earnings results or the occurrence of material
news or a material event relating to the Company, as the case may be, unless each of the
Representatives waives, in writing, such extension.
(xi) The Company will use its best efforts to list the ADSs on the NYSE and maintain the
listing of the ADSs on the NYSE.
(xii) The Company has caused each shareholder (including option holders, but except for
Telstra, which has entered into a lock-up agreement through Section 4(b)(i) hereof), officer and
director of the Company to furnish to you, on or prior to the date of this agreement, a letter or
letters, substantially in the form attached hereto as Exhibit A (the Lock-up Agreement); and the
Company will not facilitate any shareholders conversion of Ordinary Shares to ADSs during the
effective period of such Lock-up Agreements (including any automatic extension thereof as
contemplated therein) and not to release the Depositary from the obligations set forth in, or
otherwise amend, terminate or fail to enforce, the Depositary Agreement without the consent of the
Representatives.
(xiii) The Company will use its best efforts to procure its shareholders who are PRC residents
to comply with any applicable registrations or approvals required by the State Administration of
Foreign Exchange (the SAFE).
(xiv) The Company will provide the Depositary with all the necessary authorizations,
information and instructions to enable the Depositary to perform its duties in accordance with and
as contemplated by the terms of this Agreement, the Deposit Agreement, the Registration Statement,
General Disclosure Package and the Prospectus.
(xv) The Company will indemnify and hold harmless the Underwriters against any documentary,
stamp or similar issuance tax, including any interest and penalties, on the creation, issuance and
sale of the Offered Securities and on the execution and delivery of this Agreement. All payments
to be made by the Company hereunder shall be made without withholding or deduction for or on
account of any present or future taxes, duties or governmental charges whatsoever unless the
Company is compelled by law to deduct or withhold such taxes, duties or charges. In that event,
the Company shall pay such additional amounts as may be necessary in order that the net amounts
received after such withholding or
24
deduction shall equal the amounts that would have been received if no withholding or deduction
had been made.
(xvi) The Company will not take, directly or indirectly, any action designed to cause or
result in, or that has constituted or might reasonably be expected to constitute, the stabilization
or manipulation of the price of any securities of the Company.
(xvii) If the Company elects to rely upon Rule 462(b), the Company shall file a Rule 462(b)
Registration Statement with the Commission in compliance with Rule 462(b) by 10:00 p.m.,
Washington, D.C. time, on the date of this Agreement, and the Company shall at the time of filing
either pay to the Commission the filing fee for the Rule 462(b) Registration Statement or give
irrevocable instructions for the payment of such fee pursuant to Rule 111(b) under the Act; the
Company shall give the Representatives notice of any filings made pursuant to the Exchange Act or
the rules or regulations of the Commission under the Exchange Act within 48 hours prior to the
Applicable Time; the Company will give the Representatives notice of its intention to make any such
filing from the Applicable Time to the Closing Date and will furnish the Representatives with
copies of any such documents a reasonable amount of time prior to such proposed filing, as the case
may be, and will not file or use any such document to which the Representatives or counsel for the
Underwriters shall object.
(xviii) Upon request of any Underwriter, the Company will furnish, or cause to be furnished,
to such Underwriter an electronic version of the Companys trademarks, servicemarks and corporate
logo for use on the website, if any, operated by such Underwriter for the purpose of facilitating
the online offering of the ADSs (the License); provided, however, that the License shall be used
solely for the purpose described above, is granted without any fee and may not be assigned or
transferred.
(xix) Prior to each Closing Date, to issue no press release or other communication directly or
indirectly and hold no press conferences with respect to the Company or any of the Group Entities,
the financial condition, results of operations, business, properties, assets, or liabilities of the
Company or any of the Group Entities, or the offering of the ADSs, without the prior consent of the
Representatives (which consent shall not to be unreasonably withheld or delayed).
(xx) The Company shall not invest, or otherwise use the proceeds received by the Company from
its sale of the Offered ADSs in such a manner as would require the Company to register as an
investment company under the 1940 Act.
(xxi) The Company will not engage, directly or indirectly, in any other activities that would
result in such breach of U.S. Sanctions or any embargos or sanctions regulations imposed by the
United Nations. For the purposes of this paragraph, U.S. Sanctions include all U.S. sanctions or
regulations issued or administered by the OFAC, all U.S. regulations codified in Chapter V of title
31, U.S. Code of Federal Regulations, all U.S. regulations issued under the authority of the
Trading with the Enemy Act, the International Emergency Economic Powers Act, the International
Security and Development Cooperation Act, the Antiterrorism and Effective Death Penalty Act, the
Cuban Liberty and Democratic Solidarity (Libertad) Act, or the United Nations Participation Act,
the aforementioned statutes themselves, and all orders, licenses or rules issued under the
authority of any of the foregoing. The Company will maintain and implement adequate internal
controls and procedures to monitor and audit transactions that are reasonably designed to detect
and prevent any use of the proceeds from the offering of the ADSs contemplated hereby that is
inconsistent with any of the Companys representations and obligations under this paragraph.
25
(b) Each of the Selling Shareholders covenants and agrees with the several Underwriters that:
(i) No offering, sale, short sale or other disposition of any Ordinary Shares or other share
capital of the Company or other securities convertible, exchangeable or exercisable for Ordinary
Shares or derivative of Ordinary Shares owned by the Selling Shareholder or request the
registration for the offer or sale of any of the foregoing (or as to which the Selling Shareholder
has the right to direct the disposition of) will be made for a period of 180 days after the date of
this Agreement, directly or indirectly, by such Selling Shareholder, other than as contemplated
hereby or with the prior written consent of each of the Representatives on behalf of all of the
Underwriters. Notwithstanding the foregoing, if (a) during the last seventeen days of the 180-day
restricted period, the Company issues an earnings release or material news or a material event
relating to the Company occurs; or (b) prior to the expiration of the 180-day restricted period,
the Company announces that it will release earnings results during the sixteen-day period following
the last day of the 180-day restricted period, then in each case the restrictions imposed by this
Section 4(b)(i) shall continue to apply until the expiration of the eighteen-day period beginning
on the date of the release of the earnings results or the occurrence of material news or a material
event relating to the Company, as the case may be, unless each of the Representatives waives on
behalf of all of the Underwriters, in writing, such extension; provided, however, that nothing in
this paragraph shall prohibit Telstra from selling and transferring the Ordinary Shares to the
Private Placement Purchasers pursuant to the Private Placement.
(ii) In order to document the Underwriters compliance with the reporting and withholding
provisions of the U.S. Tax Equity and Fiscal Responsibility Act of 1982 and the Interest and
Dividend Tax Compliance Act of 1983 with respect to the transactions herein contemplated, such
Selling Shareholder agrees to deliver to you prior to or on the Closing Date a properly completed
and executed United States Treasury Department Form W-8 or W-9 (or other applicable form or
statement specified by Treasury Department regulations in lieu thereof).
(iii) Such Selling Shareholder will not take, directly or indirectly, any action designed to
cause or result in, or that has constituted or might reasonably be expected to constitute, the
stabilization or manipulation of the price of the Offered Securities.
(iv) Such Selling Shareholder agrees that it will not prepare or have prepared on its behalf
or use or refer to, any free writing prospectus (as defined in Rule 405 under the Act), and
agrees that it will not distribute any written materials in connection with the offer or sale of
the Offered Securities.
(v) During the Prospectus Delivery Period, such Selling Shareholder will advise the
Representatives promptly, and will confirm such advice in writing to the Representatives, of any
change in the information relating to such Selling Shareholder in the Registration Statement, the
Prospectus or any document comprising the General Disclosure Package.
(vi) Such Selling Shareholder will pay any documentary, stamp or similar issue tax, including
any interest and penalties, on the sale of the Firm Shares and, the Option Shares and arising as a
result of its execution and delivery of this Agreement. All payments to be made by such Selling
Shareholder hereunder shall be made without withholding or deduction for or on account of any
present or future taxes, duties or governmental charges whatsoever unless such Selling Shareholder
is compelled by law to deduct or withhold such taxes, duties or charges. In that event, such
Selling Shareholder shall pay such additional amounts as may be necessary in order that the net
amounts received after such withholding or deduction shall equal the amounts that would have been
received if no withholding or deduction had been made.
26
(vii) Such Selling Shareholder and/or its direct or indirect owners or controlling persons
that is a PRC resident or PRC citizen will use its best efforts to comply with any applicable SAFE
Rules and Regulations, including without limitation, completing any registration and other
procedures required under applicable SAFE Rules and Regulations, and irrevocably authorizing the
controlling person in writing, in accordance with applicable SAFE Rules and Regulations, to handle
any registrations and other procedures required under applicable SAFE Rules and Regulations on
their behalf.
(viii) (i) The net proceeds received by such Selling Shareholder from the sale of the ADSs
pursuant to this Agreement will not directly or indirectly be used, or lent, contributed or
otherwise made available to any subsidiary, joint venture partner or other person or entity,
towards any sales or operations in Belarus, Cote dIvoire, Cuba, Democratic Republic of the Congo,
Iran, Iraq, Liberia, Myanmar, North Korea, Syria, Sudan, Zimbabwe or any other country sanctioned
by OFAC or for the purpose of financing the activities of any person currently subject to any U.S.
sanctions administered by the OFAC, Her Majestys Treasury or the European Union; (ii) to use the
net proceeds received by it from the sale of the ADSs pursuant to this Agreement in a manner that
will be in compliance with and will not result in the breach by any person of the U.S. Sanctions or
any embargos or sanctions regulations imposed by the United Nations; and (iii) not to engage,
directly or indirectly, in any other activities that would result in such breach of U.S. Sanctions
or any embargos or sanctions regulations imposed by the United Nations. For the purposes of this
paragraph, U.S. Sanctions include all U.S. sanctions or regulations issued or administered by the
OFAC, all U.S. regulations codified in Chapter V of title 31, U.S. Code of Federal Regulations, all
U.S. regulations issued under the authority of the Trading with the Enemy Act, the International
Emergency Economic Powers Act, the International Security and Development Cooperation Act, the
Antiterrorism and Effective Death Penalty Act, the Cuban Liberty and Democratic Solidarity
(Libertad) Act, or the United Nations Participation Act, the aforementioned statutes themselves,
and all orders, licenses or rules issued under the authority of any of the foregoing.
(ix) Each of the Selling Shareholders (except for Telstra, which has entered into a lock-up
agreement through Section 4(b)(i) hereof) will furnish to you, on or prior to the date of this
Agreement, a Lock-up Agreement.
5. Costs and Expenses.
The Company will pay all costs, expenses and fees incident to the performance of the
obligations of the Company under this Agreement, including, without limiting the generality of the
foregoing, the following: accounting fees of the Company; the fees and disbursements of counsel
for the Company; the cost of printing and delivering to, or as requested by, the Underwriters
copies of the Registration Statement, Preliminary Prospectuses, the Issuer Free Writing
Prospectuses, the Prospectus, this Agreement, the Underwriters invitation letter, the listing
application, the Blue Sky survey and any supplements or amendments thereto; the filing fees of the
Commission; the filing fees of FINRA; the listing fee of the NYSE; and the costs and expenses
(including without limitation any damages or other amounts payable in connection with legal or
contractual liability) associated with the reforming of any contracts for sale of the Offered
Securities made by the Underwriters caused by a breach of the representation in Section 1(a)(ii)).
Telstra agrees to pay for roadshow expenses incurred in connection with the offering up to an aggregate amount of US$500,000. Any transfer taxes imposed on the sale of the Offered Securities to the several Underwriters will
be paid by the Company and each Selling Shareholder pro rata. The Company shall not,
however, be required to pay for any of the Underwriters expenses (other than those related to
qualification under FINRA rules or regulations and Blue Sky laws) except that, if this Agreement
shall not be consummated because the conditions in Section 6 hereof are not satisfied, or because
this Agreement is terminated by the Representatives pursuant to Section 11 hereof, or by reason of
any failure, refusal or inability on the part of the Company or the Selling Shareholders to perform
any undertaking or satisfy any condition of this Agreement or to comply with any of the terms
hereof on their part to be performed, unless such failure, refusal or inability is due primarily to
the default or
27
omission of any Underwriter, the Company shall reimburse the several Underwriters for
reasonable out-of-pocket expenses, including fees and disbursements of counsel, reasonably incurred
in connection with investigating, marketing and proposing to market the Offered Securities or in
contemplation of performing their obligations hereunder; but the Company and the Selling
Shareholders shall not in any event be liable to any of the several Underwriters for damages on
account of loss of anticipated profits from the sale by them of the Offered Securities. All
amounts payable hereunder in respect of fees and expenses shall be paid in U.S. dollars and free
and clear of, and without any deduction or withholding for or on account of, any applicable taxes,
levies, duties, charges or other deductions or withholdings levied in any jurisdiction from or
through which payment is made, unless such deduction or withholding is required by applicable law,
in which event the Company or the relevant Selling Shareholder, as the case may be, will pay
additional amounts so that the persons entitled to such payments will receive the amount that such
persons would otherwise have received but for such deduction or withholding (except as otherwise
provided hereunder).
Except as otherwise provided above, any out-of-pocket expenses incurred by the several
Underwriters for the road show in connection with the offering and sale of the Offered ADSs that
have not been reimbursed by the Company or the Selling Shareholder shall be bourne by the
Underwriters in the same proportion as the respective underwriting obligations of the Underwriters.
6. Conditions of Obligations of the Underwriters.
(a) The several obligations of the Underwriters to purchase the Firm Securities on the Closing
Date and the Option Securities, if any, on the Option Closing Date are subject to the accuracy, as
of the Closing Date or the Option Closing Date, as the case may be, of the representations and
warranties of the Company, the Founder and each of the Selling Shareholders contained herein, and
to the performance by the Company and each of the Selling Shareholders of their covenants and
obligations hereunder and to the following additional conditions:
(i) Each of the Registration Statement and the ADS Registration Statement and all
post-effective amendments thereto shall have become effective and the Prospectus and each Issuer
Free Writing Prospectus required shall have been filed as required by Rules 424, 430A, 430B, 430C
or 433 under the Act, as applicable, within the time period prescribed by, and in compliance with,
the Rules and Regulations, and any request of the Commission for additional information (to be
included in the Registration Statement, the ADS Registration Statement or otherwise) shall have
been disclosed to the Representatives and complied with to their reasonable satisfaction. No stop
order suspending the effectiveness of the Registration Statement or the ADS Registration Statement,
as amended from time to time, shall have been issued; no proceedings for that purpose or pursuant
to Section 8A under the Act shall have been taken or, to the knowledge of the Company or the
Selling Shareholders, shall be contemplated or threatened by the Commission; and no injunction,
restraining order or order of any nature by a Federal or state court of competent jurisdiction
shall have been issued as of the Closing Date which would prevent the issuance and sale of the
Offered Securities.
(ii) As of the Applicable Time, the Representatives shall have received certified copies of
the shareholders resolutions and the resolutions of the administrative board of the Company
authorizing the Offering and of the resolutions of the board of directors of each Selling
Shareholder, authorizing the issuance and sale of the Offered Securities.
(iii) Subsequent to the earlier of (A) the Applicable Time and (B) the execution and delivery
of this Agreement, if there are any debt securities or preferred stock of or guaranteed by the
Company or any of the Group Entities that are rated by a nationally recognized statistical rating
organization, as such term is defined by the Commission for purposes of Rule 436(g)(2) under the
Act, (i) no downgrading
28
shall have occurred in the rating accorded any such debt securities or preferred stock and
(ii) no such organization shall have publicly announced that it has under surveillance or review,
or has changed its outlook with respect to, its rating of any such debt securities or preferred
stock (other than an announcement with positive implications of a possible upgrading).
(iv) No event or condition of a type described in Section 1(a)(xxxi) hereof shall have
occurred or shall exist, which event or condition is not described in the General Disclosure
Package (excluding any amendment or supplement thereto) and the Prospectus (excluding any amendment
or supplement thereto) and the effect of which in the judgment any of the Representatives makes it
impracticable or inadvisable to proceed with the offering, sale or delivery of the Offered
Securities on the Closing Date or the Option Closing Date, as the case may be, on the terms and in
the manner contemplated by this Agreement, the General Disclosure Package and the Prospectus.
(v) On or after the date hereof there shall not have occurred any of the following: (a) any
outbreak or escalation of hostilities or declaration of war or national emergency or other national
or international calamity or crisis or change in economic or political conditions if the effect of
such outbreak, escalation, declaration, emergency, calamity, crisis or change on the financial
markets of the PRC or the United States would, in your judgment, make it impracticable or
inadvisable to market the Offered Securities or to enforce contracts for the sale of the Offered
Securities, or (b) suspension of trading in securities generally on the NYSE, the American Stock
Exchange, the NASDAQ Global Market, the Shanghai Stock Exchange or the Shenzhen Stock Exchange or
limitation on prices (other than limitations on hours or numbers of days of trading) for securities
on any such exchange, (c) the enactment, publication, decree or other promulgation of any statute,
regulation, rule or order of any court or other governmental authority which in your opinion
materially and adversely affects or may materially and adversely affect the business or operations
of the Company, (d) the declaration of a banking moratorium by Peoples Republic of China, United
States or New York State authorities, (e) the suspension of trading of the Companys ADSs by the
NYSE, the Commission, or any other governmental authority or, (f) the taking of any action by any
governmental body or agency in respect of its monetary or fiscal affairs, the effect of which in
the judgment of any of the Representatives makes it impracticable or inadvisable to proceed with
the offering, sale or delivery of the Offered Securities on the Closing Date or the Option Closing
Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the
General Disclosure Package and the Prospectus.
(vi) The Representatives shall have received on the Closing Date or the Option Closing Date,
as the case may be, the opinions and disclosure letter of Sidley Austin LLP, special United States
counsel for the Company, dated the Closing Date or the Option Closing Date, as the case may be,
addressed to the Underwriters, in the form set forth in Exhibit B.
(vii) The Representatives shall have received on the Closing Date, the opinion of Milbank
Tweed Hadley McCloy LLP, special United States counsel for the Company, dated the Closing Date,
addressed to the Underwriters, stating that (i) the Private Placement was conducted in accordance
with Regulation S under the Securities Act or pursuant to an exemption from registration under the
Act, and (ii) the Private Placement will not be integrated with the offering of Offered Securities
hereunder pursuant to applicable rules and regulations issued under the Act.
(viii) The Representatives shall have received on the Closing Date or the Option Closing Date,
as the case may be, the opinions of King & Wood, PRC counsel for the Company, dated the Closing
Date or the Option Closing Date, as the case may be, addressed to the Underwriters, in the form set
forth in Exhibit C.
29
(ix) The Representatives shall have received on the Closing Date or the Option Closing Date,
as the case may be, the opinions of Conyers Dill & Pearman, Cayman Islands and British Virgin
Islands counsel for the Company, dated the Closing Date or the Option Closing Date, as the case may
be, addressed to the Underwriters, in the form set forth in Exhibit D.
(x) The Representatives shall have received on the Closing Date or the Option Closing Date, as
the case may be, the opinions of Haldanes, special Hong Kong S.A.R. counsel for the Company, dated
the Closing Date or the Option Closing Date, as the case may be, addressed to the Underwriters, in
the form set forth in Exhibit E.
(xi) The Representatives shall have received on the Closing Date or the Option Closing Date,
as the case may be, the opinions of [], United States counsel for the Selling Shareholders (other
than Telstra), dated the Closing Date or the Option Closing Date, as the case may be, addressed to
the Underwriters in the form set forth in Exhibit F.
(xii) The Representatives shall have received on the Closing Date or the Option Closing Date,
as the case may be, the opinions (including a no registration opinion related to the sale of
Ordinary Shares by Telstra to certain investors pursuant to an exemption from registration under
the Act) of Sullivan & Cromwell LLP, special United States counsel to Telstra, dated the Closing
Date or the Option Closing Date, as the case may be, addressed to the Underwriters in the form set
forth in Exhibit G.
(xiii) The Representatives shall have received on the Closing Date or the Option Closing Date,
as the case may be, the opinions of local counsel for the Founder and the Selling Shareholders,
dated the Closing Date or the Option Closing Date, as the case may be, addressed to the
Underwriters (and stating that it may be relied upon by counsel to the Underwriters), in their
respective form set forth in Exhibit H.
(xiv) The Representatives shall have received from Simpson Thacher & Bartlett LLP, United
States counsel for the Underwriters, such opinions and disclosure letter, dated the Closing Date,
with respect to such matters as the Representatives may require, and the Company shall have
furnished to such counsel such documents as they request for the purpose of enabling them to pass
upon such matters.
(xv) The Representatives shall have received from Fangda Partners, PRC counsel for the
Underwriters, such disclosure letter, opinion or opinions, dated the Closing Date, with respect to
such matters as the Representatives may require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them to pass upon such matters.
(xvi) The Representatives shall have received on the Closing Date or the Option Closing Date,
as the case may be, such opinion or opinions dated the Closing Date or the Option Closing Date, as
the case may be, of Paul, Hastings, Janofsky & Walker LLP, counsel to the Depositary, in their
respective form set forth in Exhibit I.
(xvii) You shall have received, on each of the date hereof, the Closing Date and, if
applicable, the Option Closing Date, a letter dated the date hereof, the Closing Date or the Option
Closing Date, as the case may be, in form and substance satisfactory to you, of Ernst &
Young Hua Ming confirming that they are an independent registered public accounting firm with
respect to the Company and the Group Entities within the meaning of the Act and the applicable
Rules and Regulations and the PCAOB and stating that in their opinion the financial statements and
schedules examined by them and included in the Registration Statement, the General Disclosure
Package and the Prospectus comply in form in all material respects with the applicable accounting
requirements of the Act and the related Rules and Regulations; and
30
containing such other statements and information as is ordinarily included in accountants
comfort letters to Underwriters with respect to the financial statements and certain financial
and statistical information contained in the Registration Statement, the General Disclosure Package
and the Prospectus.
(xviii) The Representatives shall have received on the Closing Date and, if applicable, the
Option Closing Date, as the case may be, a certificate or certificates of the Chief Executive
Officer and the Chief Financial Officer of the Company to the effect that, as of the Closing Date
or the Option Closing Date, as the case may be, each of them severally represents in the form set
forth in Exhibit J.
(xix) The Representatives shall have received as of the Applicable Time and on the Closing
Date and, if applicable, the Option Closing Date, as the case may be, a certificate of each of the
Selling Shareholders to the effect that, as of the Closing Date or the Option Closing Date, as the
case may be, each of them severally represents in the form set forth in Exhibit K.
(xx) On the date hereof, the Selling Shareholders (except for Telstra) shall have furnished
for review by the Representatives executed copies of the Power of Attorney and Custodian Agreement.
(xxi) Each of the Selling Shareholders shall have transferred the Firm Shares to be sold in
accordance with Section 2 above.
(xxii) The Firm Shares and Option Shares, if any, have been duly listed, subject to notice of
issuance, on the NYSE.
(xxiii) The Lockup Agreements described in Sections 4(a)(xii) and 4(b)(ix) and as set forth in
Exhibit A are in full force and effect.
7. Conditions of the Obligations of the Company and the Selling
Shareholders.
The obligations of the Company and each of the Selling Shareholders to sell and deliver the
portion of the Firm Shares required to be delivered as and when specified in this Agreement are
subject to the conditions that at the Closing Date or the Option Closing Date, as the case may be,
(i) no stop order suspending the effectiveness of the Registration Statement shall have been issued
and in effect or proceedings therefor initiated or threatened, (ii) Telstra shall have received the
disclosure letter of Sidley Austin LLP, United States counsel for the Company, dated the Closing
Date or the Option Closing Date, as the case may be, addressed to Telstra, in the form set forth in
Exhibit B, (iii) Telstra shall have received the letter from Ernst & Young Hua Ming specified in
Section 6(a)(xvi) and (iv) each of the Company and the Founder shall have executed and delivered to
Telstra a Master Transaction Agreement in a form and substance satisfactory to Telstra, addressing,
among other matters, payment of certain previously declared dividends and indemnification
arrangements for the benefit of Telstra and its affiliates.
8. Indemnification.
(a)
(1) The Company agrees to indemnify and hold harmless each Underwriter and each person, if
any, who controls any Underwriter within the meaning of either Section 15 of the Act or Section 20
of the Exchange Act, against any losses, claims, damages or liabilities to which such Underwriter
or any such controlling person may become subject under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect thereof) arise out of
or are based upon (i) any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus, the Prospectus or any amendment or
31
supplement thereto or (ii) the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not misleading in the
light of the circumstances under which they were made; provided, however, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage or liability arises out
of or is based upon an untrue statement or alleged untrue statement, or omission or alleged
omission made in the Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus, the Prospectus, or such amendment or supplement, in reliance upon and in conformity
with (i) written information furnished to the Company by or through the Representatives
specifically for use therein, it being understood and agreed that the only such information
furnished by any Underwriter consists of the information described as such in Section 13 herein.
(2) The Founder agrees to indemnify and hold harmless each Underwriter and each person, if
any, who controls any Underwriter within the meaning of either Section 15 of the Act or Section 20
of the Exchange Act, against any losses, claims, damages or liabilities to which such Underwriter
or any such controlling person may become subject under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect thereof) arise out of
or are based upon (i) any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus, the Prospectus or any amendment or supplement thereto or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances under which they were made;
provided, however, that the Founder will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged
untrue statement, or omission or alleged omission made in the Registration Statement, any
Preliminary Prospectus, any Issuer Free Writing Prospectus, the Prospectus, or such amendment or
supplement, in reliance upon and in conformity with (i) written information furnished to the
Company by or through the Representatives specifically for use therein, it being understood and
agreed that the only such information furnished by any Underwriter consists of the information
described as such in Section 13 herein; provided, further that none of the Underwriters shall be
entitled to seek indemnification under this subsection 8(a)(2) from the Founder unless (i) the
Company has filed for bankruptcy protection, announced that it is insolvent, received a
going-concern qualification from its independent public accountants, or announced that there is
considerable doubt that it will be able to continue as a going concern, or (ii) a decree or order
by a court having jurisdiction shall have been entered under any applicable bankruptcy, insolvency,
reorganization or other similar law (A) adjudging the Company or any of its Significant
Subsidiaries (as defined in Regulation S-X under the Act) as bankrupt or insolvent, or approving
as properly filed a petition seeking reorganization of the Company or any of its Significant
Subsidiaries or (B) appointing a receiver or liquidator or trustee or assignee in bankruptcy or
insolvency of the Company or any of its Significant Subsidiaries or any of its property or (C)
ordering the winding up or liquidation of the affairs of the Company or any of its Significant
Subsidiaries.
(3) The Company and the Founder agree to reimburse each Underwriter and each such controlling
person upon demand for any legal or other out-of-pocket expenses reasonably incurred by such
Underwriter or such controlling person in connection with investigating or defending any such loss,
claim, damage or liability, action or proceeding or in responding to a subpoena or governmental
inquiry related to the offering of the Offered Securities, whether or not such Underwriter or
controlling person is a party to any action or proceeding. In the event that it is finally
judicially determined that the Underwriters were not entitled to receive payments for legal and
other expenses pursuant to this subparagraph, the Underwriters will promptly return all sums that
had been advanced pursuant hereto; provided, however that none of the Underwriters shall be
entitled to seek reimbursement under this subsection 8(a)(3) from the Founder unless both of the
following conditions are met: (a) the Underwriter shall first have sought reimbursement from the
Company in writing under subsection 8(a)(3) and (b) the Company has not satisfied such request
32
for indemnification in full within 30 days of written notification. Notwithstanding the
foregoing, an Underwriter shall not be required to make an initial demand on the Company if the
Company has filed for bankruptcy protection, announced that it is insolvent, received a
going-concern qualification from its independent public accountants, or announced that there is
considerable doubt that it will be able to continue as a going concern.
(b) Each of the Selling Shareholders, other than Telstra, agrees, severally and not jointly,
to indemnify the Underwriters and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, against any losses, claims,
damages or liabilities to which such Underwriter or controlling person may become subject under the
Act or otherwise; provided, however, that such Selling Shareholder will be liable in any such case
only to the extent such losses, claims, damages or liabilities arise out of or are based upon an
untrue statement of a material fact in, or an omission of a material fact required or necessary to
be stated in order to make the statements that are made not misleading from, the information
relating to such Selling Shareholder furnished to the Company by such Selling Shareholder in
writing expressly for use in the Registration Statement, as of its effective time, the General
Disclosure Package, as of the Applicable Time, and any individual Limited Use Free Writing
Prospectus; provided, further, that the aggregate liability of each Selling Shareholder pursuant to
this Section 8(b) shall not exceed the aggregate net proceeds before expenses received by such
Selling Shareholder from the Underwriters for the Offered Securities. This indemnity obligation
will be in addition to any liability which the Company, the Founder and Telstra may otherwise have.
(c) Telstra agrees to indemnify the Underwriters and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, against
any losses, claims, damages or liabilities to which such Underwriter or controlling person may
become subject under the Act or otherwise; provided, however, that Telstra will be liable in any
such case only to the extent such losses, claims, damages or liabilities arise out of or are based
upon an untrue statement of a material fact in, or an omission of a material fact required or
necessary to be stated in order to make the statements that are made not misleading from, the
information relating to Telstra furnished to the Company by Telstra in writing expressly for use in
the Registration Statement, as of its effective time, the General Disclosure Package, as of the
Applicable Time, and any individual Limited Use Free Writing Prospectus. This indemnity obligation
will be in addition to any liability which the Company, the Founder and the Selling Shareholders,
other than Telstra, may otherwise have.
(d) Each Underwriter, severally and not jointly, will indemnify and hold harmless the Company,
each of its directors, each of its officers who have signed the Registration Statement, each of the
Selling Shareholders, the Founder and each person, if any, who controls the Company, such Selling
Shareholders or the Founder within the meaning of the Act, against any losses, claims, damages or
liabilities to which the Company or any such director, officer, Selling Shareholder or controlling
person may become subject under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of or are based upon (i) any
untrue statement or alleged untrue statement of any material fact contained in the Registration
Statement, any Preliminary Prospectus, any Issuer Free Writing Prospectus, the Prospectus or any
amendment or supplement thereto, or (ii) the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were made; and will reimburse any
legal or other expenses reasonably incurred by the Company or any such director, officer, Selling
Shareholder or controlling person in connection with investigating or defending any such loss,
claim, damage, liability, action or proceeding; provided, however, that each Underwriter will be
liable in each case to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission has been made in the Registration Statement, any
Preliminary Prospectus, any Issuer Free Writing Prospectus, the Prospectus or such amendment or
supplement, in reliance upon
33
and in conformity with written information furnished to the Company by or through the
Representatives specifically for use therein, it being understood and agreed that the only such
information furnished by any Underwriter consists of the information described as such in Section
13 herein. This indemnity agreement will be in addition to any liability which such Underwriter
may otherwise have.
(e) In case any proceeding (including any governmental investigation) shall be instituted
involving any person in respect of which indemnity may be sought pursuant to this Section 8, such
person (the indemnified party) shall promptly notify the person against whom such indemnity may
be sought (the indemnifying party) in writing. No indemnification provided for in Section 8(a),
(b), (c) or (d) shall be available to any party who shall fail to give notice as provided in this
Section 8(e) if the party to whom notice was not given was unaware of the proceeding to which such
notice would have related and was materially prejudiced by the failure to give such notice, but the
failure to give such notice shall not relieve the indemnifying party or parties from any liability
which it or they may have to the indemnified party for contribution or otherwise than on account of
the provisions of Section 8(a), (b), (c) or (d). In case any such proceeding shall be brought
against any indemnified party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it
shall wish, jointly with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party and shall pay as incurred the fees and
disbursements of such counsel related to such proceeding. In any such proceeding, any indemnified
party shall have the right to retain its own counsel at its own expense. Notwithstanding the
foregoing, the indemnifying party shall pay as incurred (or within 30 days of presentation) the
fees and expenses of the counsel retained by the indemnified party in the event that (i) the
indemnifying party and the indemnified party shall have mutually agreed to the retention of such
counsel, (ii) the named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing interests between them or
(iii) the indemnifying party shall have failed to assume the defense and employ counsel acceptable
to the indemnified party within a reasonable period of time after notice of commencement of the
action. It is understood that the indemnifying party shall not, in connection with any proceeding
or related proceedings in the same jurisdiction, be liable for the reasonable fees and expenses of
more than one separate firm for all such indemnified parties (in addition to any local counsel).
Such firm shall be designated in writing by you in the case of parties indemnified pursuant to
Section 8(a), (b) or (c) and by the Company, the Founder and the Selling Shareholders in the case
of parties indemnified pursuant to Section 8(c). If at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature
contemplated by Section 8(a), (b) or (c) effected without its written consent if (i) such
settlement is entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such
settlement at least 30 days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with such request prior to the
date of such settlement. In addition, the indemnifying party will not, without the prior written
consent of the indemnified party, settle or compromise or consent to the entry of any judgment in
any pending or threatened claim, action or proceeding of which indemnification may be sought
hereunder (whether or not any indemnified party is an actual or potential party to such claim,
action or proceeding) unless such settlement, compromise or consent includes an unconditional
release of each indemnified party from all liability arising out of such claim, action or
proceeding.
(f) To the extent that the indemnification provided for in this Section 8 is unavailable to or
insufficient to hold harmless an indemnified party under Section 8(a), (b), (c) or (d) above in
respect of any losses, claims, damages or liabilities (or actions or proceedings in
34
respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) in such proportion as is appropriate to reflect the relative benefits received by the
Company, the Founder and the Selling Shareholders on the one hand and the Underwriters on the other
from the offering of the Offered Securities. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law then each indemnifying party
shall contribute to such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative fault of the Company
and the Selling Shareholders on the one hand and the Underwriters on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof), as well as any other relevant equitable considerations.
The relative benefits received by the Company, the Founder and the Selling Shareholders on the one
hand and the Underwriters on the other shall be deemed to be in the same proportion as the total
net proceeds from the offering (before deducting expenses) received by the Selling Shareholders
bear to the total underwriting discounts and commissions received by the Underwriters, in each case
as set forth in the table on the cover page of the Prospectus. The relative fault 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 the Company, the Founder or the Selling Shareholders on the one hand or the
Underwriters on the other and the parties relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company, the Founder, the Selling Shareholders and the Underwriters agree that it would
not be just and equitable if contributions pursuant to this Section 8(f) were determined by pro
rata allocation (even if the Underwriters 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
above in this Section 8(f). The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions or proceedings in respect thereof) referred to
above in this Section 8(f) shall be deemed to include 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 subsection (f), (i) no Underwriter shall be required
to contribute any amount in excess of the underwriting discounts and commissions applicable to the
Offered Securities purchased by such Underwriter, (ii) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent misrepresentation, and (iii) no
Selling Shareholder shall be required to contribute any amount in excess of the proceeds received
by such Selling Shareholder from the Underwriters in the offering. The Underwriters obligations
in this Section 8(f) to contribute are several in proportion to their respective underwriting
obligations and not joint.
(g) In any proceeding relating to the Registration Statement, any Preliminary Prospectus, any
Issuer Free Writing Prospectus, the Prospectus or any supplement or amendment thereto, each party
against whom contribution may be sought under this Section 8 hereby consents to the jurisdiction of
any court having jurisdiction over any other contributing party, agrees that process issuing from
such court may be served upon it by any other contributing party and consents to the service of
such process and agrees that any other contributing party may join it as an additional defendant in
any such proceeding in which such other contributing party is a party. In any proceeding relating
to the Registration Statement, any Preliminary Prospectus, any Issuer Free Writing Prospectus, the
Prospectus, any supplement or amendment thereto, or in relation to or in connection with this
Agreement, each of the Company and the Selling Shareholders irrevocably submits to the jurisdiction
of the courts of any U.S. federal and state court located in the City of New York, and waives any
objection to proceedings in such courts whether on the grounds that the proceedings have been
brought in an inconvenient forum or otherwise. These submissions are made for the benefit of the
Underwriters and shall not affect the right of the Underwriters to take
35
proceedings in any other
court of competent jurisdiction nor shall the taking of proceedings in one or more
jurisdiction preclude the Underwriters from taking proceedings in any other jurisdiction
(whether concurrently or not).
(h) Any losses, claims, damages, liabilities or expenses for which an indemnified party is
entitled to indemnification or contribution under this Section 8 shall be paid by the indemnifying
party to the indemnified party as such losses, claims, damages, liabilities or expenses are
incurred. The indemnity and contribution agreements contained in this Section 8 and the
representations and warranties of the Company, the Founder and the Selling Shareholders set forth
in this Agreement shall remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter or any person controlling any Underwriter,
the Company, its directors or officers or any persons controlling the Company, the Founder or the
Selling Shareholders (ii) acceptance of any Offered Securities and payment therefor hereunder, and
(iii) any termination of this Agreement. A successor to any Underwriter, or any person controlling
any Underwriter, or to the Company, its directors or officers, or any person controlling the
Company, the Founder and the Selling Shareholders, shall be entitled to the benefits of the
indemnity, contribution and reimbursement agreements contained in this Section 8.
9. Default by Underwriters.
If on the Closing Date or the Option Closing Date, as the case may be, any Underwriter shall
fail to purchase and pay for the portion of the Offered Securities which such Underwriter has
agreed to purchase and pay for on such date (otherwise than by reason of any default on the part of
the Company or a Selling Shareholder), you, as Representatives of the Underwriters, shall use your
reasonable efforts to procure within 24 hours thereafter one or more of the other Underwriters, or
any others, to purchase from the Company and the Selling Shareholders such amounts as may be agreed
upon and upon the terms set forth herein, the Offered Securities which the defaulting Underwriter
or Underwriters failed to purchase. If during such 24 hours you, as such Representatives, shall
not have procured such other Underwriters, or any others, to purchase the Offered Securities agreed
to be purchased by the defaulting Underwriter or Underwriters, then (a) if the aggregate number of
shares with respect to which such default shall occur does not exceed 10% of the Offered Securities
to be purchased on the Closing Date or the Option Closing date, as the case may be, the other
Underwriters shall be obligated, severally, in proportion to the respective numbers of Offered
Securities which they are obligated to purchase hereunder, to purchase the Offered Securities which
such defaulting Underwriter or Underwriters failed to purchase, or (b) if the aggregate number of
shares of Offered Securities with respect to which such default shall occur exceeds 10% of the
Offered Securities to be purchased on the Closing Date or the Option Closing Date, as the case may
be, the Company and the Selling Shareholders or you as the Representatives of the Underwriters will
have the right, by written notice given within the next 24-hour period to the parties to this
Agreement, to terminate this Agreement without liability on the part of the non-defaulting
Underwriters or of the Company or of the Selling Shareholders except to the extent provided in
Sections 5 and 8 hereof. In the event of a default by any Underwriter or Underwriters, as set
forth in this Section 9, the Closing Date or Option Closing Date, as the case may be, may be
postponed for such period, not exceeding seven days, as you, as Representatives, may determine in
order that the required changes in the Registration Statement, the General Disclosure Package or in
the Prospectus or in any other documents or arrangements may be effected. The term Underwriter
includes any person substituted for a defaulting Underwriter. Any action taken under this Section
9 shall not relieve any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
10. Notices.
All communications hereunder shall be in writing and, except as otherwise provided herein,
will be mailed, delivered, telecopied or telegraphed and confirmed as follows: if to the
Underwriters, to each
36
of Deutsche Bank Securities Inc., 60 Wall Street, 4th Floor, New
York, New York 10005; Attention: Syndicate
Manager, with a copy to Deutsche Bank Securities Inc., 60 Wall Street, New York, New York
10005, Attention: General Counsel; Goldman Sachs (Asia) L.L.C., 68/F Cheung Kong Center, 2 Queens
Road Central, Hong Kong; if to the Company, the Founder or the Selling Shareholders (other than
Telstra), to SouFun Holdings Limited, 8/F, Tower 3, Xihuan Plaza, 1 Xizhimenwai Street, Xicheng
District, Beijing 100044, China, Attention: [Vincent Mo]; if to Telstra, to Telstra International
Holdings Limited, 41/242 Exhibition Street, Melbourne, Victoria 3000, Australia, Attention: Tarek
Robbiati, Group Managing Director, Telstra International.
11. Termination.
This Agreement may be terminated by you by notice to the Company, the Founder and each of the
Selling Shareholders:
(a) at any time prior to the Closing Date or any Option Closing Date (if different from the
Closing Date and then only as to the Option Shares) if any of the following has occurred: (i) since
the respective dates as of which information is given in the Registration Statement, the General
Disclosure Package and the Prospectus, any material adverse change or any development involving a
prospective material adverse change in or affecting the earnings, business, management, properties,
assets, rights, operations, condition (financial or otherwise) or prospects of the Company and the
Group Entities taken as a whole, whether or not arising in the ordinary course of business, (ii)
any material adverse change in financial markets in the United States or the international
financial markets or any outbreak or escalation of hostilities or declaration of war or national
emergency or other national or international calamity or crisis in each case the effect of such
outbreak, escalation, declaration, emergency, calamity, crisis or change on the financial markets
of the United States or the international financial markets would, in your judgment, make it
impracticable or inadvisable to market the Offered Securities or to enforce contracts for the sale
of the Offered Securities, or (iii) trading in any securities of the Company has been suspended or
materially limited by the NYSE, or trading generally on the NYSE or in the NASDAQ Global Market has
been suspended or materially limited, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices have been required, by any of said exchanges or by such system or by
order of the Commission, the FINRA. or any other governmental authority, (iv) the enactment,
publication, decree or other promulgation of any statute, regulation, rule or order of any court or
other governmental authority which in your opinion materially and adversely affects or may
materially and adversely affect the business or operations of the Company, (v) a material
disruption in commercial banking or securities settlement or clearance services in the United
States or the Peoples Republic of China or the declaration of a banking moratorium by the Peoples
Republic of China, United States or New York State authorities, (vi) any downgrading, or placement
on any watch list for possible downgrading, in the rating of any of the Companys debt securities
by any nationally recognized statistical rating organization (as defined for purposes of Rule
436(g) under the Exchange Act); or (vii) the taking of any action by any governmental body or
agency in respect of its monetary or fiscal affairs which in your reasonable opinion has a material
adverse effect on the securities markets in the United States; or
(b) as provided in Sections 6 and 9 of this Agreement.
12. Successors.
This Agreement has been and is made solely for the benefit of the Underwriters, the Company,
the Founder and the Selling Shareholders and their respective successors, executors,
administrators, heirs and assigns, and the officers, directors and controlling persons referred to
herein, and no other person
37
will have any right or obligation hereunder. No purchaser of any of
the Offered Securities from any Underwriter shall be deemed a successor or assign merely because of
such purchase.
13. Information Provided by Underwriters.
The Company, the Founder, the Selling Shareholders and the Underwriters acknowledge and agree
that the only information furnished or to be furnished by any Underwriter to the Company for
inclusion in the Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus or the Prospectus consists of the information set forth in the third, twelfth through
seventeenth, nineteenth (the first sentence only), twenty-first, twenty-second, twenty-third (the
first sentence only) and twenty-fourth paragraphs under the caption Underwriting in the
Prospectus.
14. Applicable Law
This Agreement shall be governed by, and construed in accordance with, the law of the State of
New York, including, without limitation, Section 5-1401 of the New York General Obligations Law.
The Company and each of the Selling Shareholders hereby submit to the non-exclusive
jurisdiction of the Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby. The Company and the Selling Shareholders irrevocably and unconditionally waive
any objection to the laying of venue of any suit or proceeding arising out of or relating to this
Agreement or the transactions contemplated hereby in Federal and state courts in the Borough of
Manhattan in The City of New York and irrevocably and unconditionally waive and agree not to plead
or claim in any such court that any such suit or proceeding in any such court has been brought in
an inconvenient forum.
Each of the Company, the Founder and the Selling Shareholders, other than Telstra, appoints
Law Debenture Corporate Services Inc., 400 Madison Avenue, 4th Floor, New York, New York
10017 U.S.A., as its authorized agent in New York, upon which process may be served in any such
proceeding, and agrees that service of process upon such agent, and written notice of said service
to Company, the Founder and each Selling Shareholder, other than Telstra, as applicable, by the
person serving the same to the address provided in Section 10, shall be deemed in every respect
effective service of process upon the Company, the Founder and each Selling Shareholder, other than
Telstra, as applicable, in any such proceeding. The Company, the Founder and each of the Selling
Shareholders, other than Telstra, further agree to take any and all action as may be necessary to
maintain such designation and appointment of such agent in full force and effect for a period of
seven years from the date of this Agreement, provided that following the appointment of a
replacement authorized agent, the Company, the Founder and each of the Selling Shareholders, other
than Telstra, upon whom process may be served in any such proceeding in lieu of any existing agent
and the receipt of written notice by the Underwriters, the Company, the Founder and the Selling
Shareholders, other than Telstra, may terminate the appointment of any such existing agent.
Telstra appoints [], as its authorized agent in New York, upon which process may be served in
any such proceeding, and agrees that service of process upon such agent, and written notice of said
service to Telstra, as applicable, by the person serving the same to the address provided in
Section 10. Notices, shall be deemed in every respect effective service of process upon Telstra in
any such proceeding. Telstra further agrees to take any and all action as may be necessary to
maintain such designation and appointment of such agents in full force and effect for a period of
seven years from the date of this Agreement, provided that following the appointment of a
replacement authorized agent by Telstra upon whom process may be served in any such proceeding in
lieu of any existing agent and the receipt of written notice by the Underwriters, Telstra may
terminate the appointment of any such existing agent.
38
15. Miscellaneous.
The reimbursement, indemnification and contribution agreements contained in this Agreement and
the representations, warranties and covenants in this Agreement shall remain in full force and
effect regardless of (a) any termination of this Agreement, (b) any investigation made by or on
behalf of any Underwriter or controlling person thereof, or by or on behalf of the Company or its
directors or officers or any Selling Shareholder or controlling person thereof, as the case may be,
and (c) delivery of and payment for the Offered Securities under this Agreement.
The Company, the Founder and the Selling Shareholders acknowledge and agree that each
Underwriter in providing investment banking services to the Company, the Founder and the Selling
Shareholders in connection with the offering, including in acting pursuant to the terms of this
Agreement, has acted and is acting as an independent contractor and not as a fiduciary and the
Company, the Founder and the Selling Shareholders do not intend such Underwriter to act in any
capacity other than as an independent contractor, including as a fiduciary or in any other position
of higher trust.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument.
The Underwriters, on the one hand, and the Company, the Founder and the Selling Shareholders,
on the other hand, waive any right to trial by jury in any action, claim, suit or proceeding with
respect to your engagement as underwriter or your role in connection herewith.
If the foregoing letter is in accordance with your understanding of our agreement, please sign
and return to us the enclosed duplicates hereof, whereupon it will become a binding agreement among
the Selling Shareholders, the Founder, the Company and the several Underwriters in accordance with
its terms.
39
Any person executing and delivering this Agreement as attorney-in-fact for a Selling
Shareholder represents by so doing that he has been duly appointed as attorney-in-fact by such
Selling Shareholder pursuant to a validly existing and binding power of attorney which authorizes
such attorney-in-fact to take such action.
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Very truly yours,
SOUFUN HOLDINGS LIMITED
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By: |
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Name: |
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Title: |
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TELSTRA INTERNATIONAL HOLDINGS LIMITED
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By: |
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Name: |
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Title: |
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THE FOUNDER
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Vincent Tianquan Mo |
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ATTORNEY-IN-FACT FOR THE SELLING
SHAREHOLDERS (OTHER THAN TELSTRA)
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By: |
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Name: |
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Title: |
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40
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the date first
above written.
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DEUTSCHE BANK SECURITIES INC. |
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As Representative of the several
Underwriters listed on Schedule I
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By: |
Deutsche Bank Securities Inc. |
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By: |
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Authorized Officer |
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By: |
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Authorized Officer |
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GOLDMAN SACHS (ASIA) L.L.C.
As Representative of the several Underwriters listed on Schedule I
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By: |
Goldman Sachs (Asia) L.L.C. |
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By: |
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Authorized Officer |
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41
SCHEDULE I
Schedule of Underwriters
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Underwriter |
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Number of Firm ADSs to be Purchased |
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Deutsche Bank Securities Inc. |
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[] |
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Goldman Sachs (Asia) L.L.C |
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[] |
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Total |
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[] |
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42
SCHEDULE II
Schedule of Selling Shareholders
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Number of |
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Number of |
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Firm ADSs |
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Option ADSs |
Selling Shareholder |
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to be Sold |
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to be Sold |
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Telstra International Holdings Limited
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[] |
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[] |
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IDG
Technology Venture Investment Inc.
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[] |
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[] |
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Total
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[] |
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[] |
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43
SCHEDULE III
The following information is also included in the General Disclosure Package:
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The offer price to the public of the Offered Securities as set forth herein; |
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[Any other items dependent on the offer price]; and |
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[TBD] |
44
SCHEDULE IV
Issuer Free Writing Prospectus as defined in the Agreement shall include each of the following
documents:
45
EXHIBIT A
LOCK-UP AGREEMENT
[date]
SouFun Holdings Limited
8/F, Tower 3, Xihuan Plaza
1 Xizhimenwai Street, Xicheng District
Beijing 100044, China
Deutsche Bank Securities Inc.
60 Wall Street
New York, New York 10005
USA
and
Goldman Sachs (Asia) L.L.C.
68/F Cheung Kong Center
2 Queens Road Central
Hong Kong
As Representatives of the
Several Underwriters
Ladies and Gentlemen:
The undersigned understands that Deutsche Bank Securities Inc. and Goldman Sachs (Asia)
L.L.C., as representatives (the Representatives) of the several underwriters (the
Underwriters), propose to enter into an Underwriting Agreement (the Underwriting Agreement)
with SouFun Holdings Limited (the Company), the Founder, and the Selling Shareholders named
therein, providing for the public offering by the Underwriters, including the Representatives, of
American depositary shares (ADSs) representing Class A ordinary shares, par value HK$1.00 per
Class A ordinary share (the Ordinary Shares) of the Company (the Public Offering). Capitalized
terms used but not defined herein shall have the meanings ascribed to them in the Underwriting
Agreement.
To induce the Underwriters that may participate in the Public Offering to continue their
efforts in connection with the Public Offering, the undersigned agrees that, without the prior
written consent of each of the Representatives, the undersigned will not, and will procure that its
affiliates will not, directly or indirectly, offer, sell, pledge, purchase any option or contract
to sell (including any short sale), grant any option, right or warrant to purchase or otherwise
dispose of any ADSs or Ordinary Shares of the Company (including, without limitation, Ordinary
Shares of the Company which may be deemed to be beneficially owned by the undersigned on the date
hereof in accordance with the rules and regulations of the United States Securities and Exchange
Commission, Ordinary Shares which may be issued upon exercise of a stock option or warrant and any
other security convertible into or exchangeable for ADSs or Ordinary Shares) or file or cause to be
filed any registration statement under the U.S. Securities Act of 1933, as amended, or enter into
any Hedging
46
Transaction (as defined below) relating to the ADSs or Ordinary Shares (each of the foregoing
referred to as a Disposition) during the period specified in the following paragraph (the
Lock-Up Period). The foregoing restriction is expressly intended to preclude the undersigned
from engaging in any Hedging Transaction (as defined below) or other transaction which is designed
to or reasonably expected to lead to or result in a Disposition during the Lock-Up Period even if
the securities would be disposed of by someone other than the undersigned. Hedging Transaction
means any short sale (whether or not against the box) or any purchase, sale or grant of any right
(including, without limitation, any put or call option) with respect to any security (other than a
broad-based market basket or index) that includes, relates to or derives any significant part of
its value from the ADSs or Ordinary Shares whether such Hedging Transaction is to be settled by
delivery of ADSs, Ordinary Shares, other securities, in cash or otherwise.
The initial Lock-Up Period will commence on the date hereof and continue until, and include,
the date that is 180 days after the date of the final prospectus relating to the Public Offering
(the Initial Lock-Up Period); provided, however, that if (1) during the last seventeen days of
the Initial Lock-Up Period, (A) the Company releases earnings results or (B) material news or a
material event relating to the Company occurs, or (2) prior to the expiration of the Initial
Lock-Up Period, the Company announces that it will release earnings results during the sixteen-day
period following the last day of the Initial Lock-Up Period, then in each case the Lock-Up Period
will be extended until the expiration of the eighteen-day period beginning on the date of the
release of the earnings results or the occurrence of material news or a material event relating to
the Company, as the case may be, unless the Representatives waive, in writing, such extension.
Notwithstanding the foregoing, the Lock-Up Period shall not apply to (A) the Offered
Securities to be sold by the undersigned pursuant to the Underwriting Agreement and (B) transfers
of ordinary shares as a bona fide gift or gifts; provided that in the case of any transfer or
distribution pursuant to clause (B), each donee or distributee shall execute and deliver to each of
the Representatives a lock-up letter in the form of this paragraph; and provided, further, that in
the case of any transfer or distribution pursuant to clause (B), no filing by any party (donor,
donee, transferor or transferee) under the U.S. Securities Exchange Act of 1934, as amended, or
other public announcement shall be required or shall be made voluntarily in connection with such
transfer or distribution (other than a filing on a Form 5 made after the expiration of the 180-day
period referred to above).
The undersigned agrees that the Company may, and that the undersigned will, (i) with respect
to any Ordinary Shares or other Company securities for which the undersigned is the record holder,
cause the transfer agent for the Company to note stop transfer instructions with respect to such
securities on the transfer books and records of the Company and (ii) with respect to any Ordinary
Shares or other Company securities for which the undersigned is the beneficial holder but not the
record holder, cause the record holder of such securities to cause the transfer agent for the
Company to note stop transfer instructions with respect to such securities on the transfer books
and records of the Company.
In addition, the undersigned hereby waives any and all notice requirements and rights with
respect to registration of securities pursuant to any agreement, understanding or otherwise setting
forth the terms of any security of the Company held by the undersigned, including any registration
rights agreement to which the undersigned and the Company may be party; provided that such waiver
shall apply only to the proposed Public Offering, and any other action taken by the Company in
connection with the proposed Public Offering.
The undersigned hereby agrees that, to the extent that the terms of this Lock-Up Agreement
conflict with or are in any way inconsistent with any registration rights agreement to which the
undersigned and the Company may be a party, this Lock-Up Agreement supersedes such registration
rights agreement.
47
The undersigned hereby represents and warrants that the undersigned has full power and
authority to enter into this Lock-Up Agreement. All authority herein conferred or agreed to be
conferred shall survive the death or incapacity of the undersigned and any obligations of the
undersigned shall be binding upon the heirs, personal representatives, successors and assigns of
the undersigned.
Notwithstanding anything herein to the contrary, if the closing of the Public Offering has not
occurred prior to [], this agreement shall be of no further force or effect.
[remainder of page intentionally left blank]
48
EX-3.2
Exhibit 3.2
THE COMPANIES LAW (REVISED)
COMPANY LIMITED BY SHARES
AMENDED AND RESTATED MEMORANDUM OF ASSOCIATION
OF
SouFun Holdings Limited
(adopted
by special resolution passed on August 4, 2010; effective
conditional and
immediately upon
commencement of trading of the Companys American Depositary
Shares
representing Class A Ordinary
Shares of the Company on the New York Stock Exchange)
NAME
1. |
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The name of the Company is SouFun Holdings Limited. |
REGISTERED OFFICE
2. |
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The Registered Office of the Company shall be at the offices of Offshore Incorporations
(Cayman) Limited, Scotia Centre, 4th Floor, P.O. Box 2804, George Town, Grand Cayman,
KY1-1112. Cayman Islands. |
GENERAL OBJECTS AND POWERS
3. |
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Subject to the following provisions of this Memorandum, the objects for which the Company is
established are unrestricted and shall include, but without limitation: |
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(a) |
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to act and to perform all the functions of a holding company in all its
branches and to co-ordinate the policy and administration of any subsidiary company or
companies wherever incorporated or carrying on business or of any group of companies of
which the Company or any subsidiary company is a member or which are in any manner
controlled directly or indirectly by the Company; |
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(b) |
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to act as an investment company and for that purpose to acquire and hold upon
any terms and, either in the name of the Company or that of any nominee, shares, stock,
debentures, debenture stock, annuities, notes, mortgages, bonds, obligations and
securities, foreign exchange, foreign currency deposits and commodities, issued or
guaranteed by any company wherever incorporated or carrying on business, or by any
government, sovereign, ruler, commissioners, public body or authority, supreme,
municipal, local or otherwise, by original subscription, tender, purchase, exchange,
underwriting, participation in syndicates or in any other manner and whether or not
fully paid up, and to make payments thereon as called up or in advance of calls or
otherwise and to subscribe for the same, whether conditionally or absolutely, and to
hold the same with a view to investment, but with the power to vary any investments,
and to exercise and enforce all rights and powers conferred by or incident to the
ownership thereof, and to invest and deal with the moneys of the Company not
immediately required upon such securities and in such manner as may be from time to
time determined. |
4. |
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Subject to the following provisions of this Memorandum, the Company shall have and be capable
of exercising all the functions of a natural person of full capacity irrespective of any
question of corporate benefit, as provided by Section 27(2) of The Companies Law (Revised). |
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5. |
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Nothing in this Memorandum shall permit the Company to carry on a business for which a
licence is required under the laws of the Cayman Islands unless duly licensed. |
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6. |
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If the Company is exempted, it shall not trade in the Cayman Islands with any person, firm or
corporation except in furtherance of the business of the Company
carried on outside the Cayman Islands; provided that nothing in this clause shall be construed as to
prevent the Company effecting and concluding contracts in the Cayman Islands, and exercising
in the Cayman Islands all of its powers necessary for the carrying on of its business
outside the Cayman Islands. |
LIMITATION OF LIABILITY
7. |
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The liability of each member is limited to the amount from time to time unpaid on such
members shares. |
AUTHORISED CAPITAL
8. |
|
The authorized share capital of the Company is HK$600,000,000 divided into 50,767426 Class A
Ordinary Shares of a par value of HK$1.00 each and 25,298,329 Class B Ordinary Shares of a par
value of HK$1.00 each and 523,934,245 undesignated shares of a par value of HK$1.00 each
(which shall have the rights as determined by the board of directors of the Company in
accordance with the articles of association of the Company), with power for the Company
insofar as is permitted by law to redeem or purchase any of its shares and to increase or
reduce the said capital subject to the provisions of the Companies Law (Revised), this
Memorandum and the Articles of Association and to issue any part of its capital, whether
original, redeemed or increased with or without any preference, priority or special privilege
or subject to any postponement of rights or to any conditions or restrictions and so that
unless the conditions of issue shall otherwise expressly declare every issue of shares whether
stated to be preference or otherwise shall be subject to the powers hereinbefore contained. |
The Companies Law (Revised)
Company Limited by Shares
THE AMENDED AND RESTATED
ARTICLES OF ASSOCIATION
OF
SOUFUN HOLDINGS LIMITED
(Adopted
by way of a special resolution passed on 4 August 2010,
effective conditional and immediately upon commencement of trading of the Companys
American Depositary Shares representing Class A Ordinary Shares of the Company on the
New York Stock Exchange)
I N D E X
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SUBJECT |
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Article No. |
Table A |
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1 |
Interpretation |
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2 |
Share Capital |
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3 |
Alteration Of Capital |
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4-7 |
Share Rights |
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8-9 |
Variation Of Rights |
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10-11 |
Shares |
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12-15 |
Share Certificates |
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16-21 |
Lien |
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22-24 |
Calls On Shares |
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25-33 |
Forfeiture Of Shares |
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34-42 |
Register Of Members |
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43-44 |
Record Dates |
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45 |
Transfer Of Shares |
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46-51 |
Transmission Of Shares |
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52-54 |
Untraceable Members |
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55 |
General Meetings |
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56-58 |
Notice Of General Meetings |
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59-60 |
Proceedings At General Meetings |
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61-65 |
Voting |
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66-77 |
Proxies |
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78-83 |
Corporations Acting By Representatives |
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84 |
No Action By Written Resolutions Of Members |
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85 |
Board Of Directors |
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86 |
Disqualification Of Directors |
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87 |
Executive Directors |
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88-89 |
Alternate Directors |
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90-93 |
Directors Fees And Expenses |
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94-96 |
Directors Interests |
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97-100 |
General Powers Of The Directors |
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101-106 |
Borrowing Powers |
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107-110 |
Proceedings Of The Directors |
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111-120 |
Audit Committee |
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121-123 |
Officers |
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124-127 |
Register of Directors and Officers |
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128 |
Minutes |
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129 |
Seal |
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130 |
Authentication Of Documents |
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131 |
Destruction Of Documents |
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132 |
Dividends And Other Payments |
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133-142 |
Reserves |
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143 |
Capitalisation |
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144-145 |
Subscription Rights Reserve |
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146 |
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SUBJECT |
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Article No. |
Accounting Records |
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147-151 |
Audit |
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152-157 |
Notices |
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158-160 |
Signatures |
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161 |
Winding Up |
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162-163 |
Indemnity |
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164 |
Amendment To Memorandum and Articles of Association
And Name of Company |
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165 |
Information |
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166 |
Registration by Way of Continuation |
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167 |
- 1 -
INTERPRETATION
TABLE A
1. The regulations in Table A in the Schedule to the Companies Law (Revised) do not apply to the
Company.
INTERPRETATION
2. (1) In these Articles, unless the context otherwise requires, the words standing in the first
column of the following table shall bear the meaning set opposite them respectively in the second
column.
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WORD |
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MEANING |
Audit Committee
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the audit committee of the Company formed by the Board pursuant to Article
121 hereof, or any successor audit committee. |
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Auditor
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the independent auditor of the Company which shall be an internationally
recognized firm of independent accountants. |
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Articles
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these Articles in their present form or as supplemented or amended or substituted
from time to time. |
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Board or Directors
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the board of directors of the Company or the directors present at a
meeting of directors of the Company at which a quorum is present. |
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capital
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the share capital from time to time of the Company. |
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Class A Ordinary Share
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a class A ordinary share of HK$1.00 each in the capital of the
Company. |
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Class B Ordinary Share
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a class B ordinary share of HK$1.00 each in the capital of the
Company. |
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clear days
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in relation to the period of a notice, that period excluding the day when the
notice is given or deemed to be given and the day for which it is given or on which it
is to take effect. |
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clearing house
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a clearing house recognised by the laws of the jurisdiction in which the
shares of the Company (or depositary receipts therefor) are listed or quoted on a |
- 2 -
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WORD |
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MEANING |
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stock
exchange or interdealer quotation system in such
jurisdiction. |
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Company
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SouFun Holdings Limited. |
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competent regulatory a competent
regulatory authority in the
territory authority
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where the
shares of the Company (or depositary
receipts therefor) are listed or quoted on a stock
exchange or interdealer quotation system in such
territory. |
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debenture and
debenture holder
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include debenture stock and debenture
stockholder respectively. |
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Designated Stock
Exchange
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the New York Stock Exchange or the NASDAQ Stock
Market. |
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dollars and $
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dollars, the legal currency of the United States of America. |
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Exchange Act
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the Securities Exchange Act of 1934, as amended. |
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Hong Kong dollars and
HK$
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Hong Kong dollars, the legal currency of The Hong Kong Special
Administrative Region of The Peoples
Republic of China. |
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head office
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such office of the Company as the Directors may from time to time
determine to be the principal office of the Company. |
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Law
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The Companies Law, Cap. 22 (Law 3 of 1961, as consolidated and revised) of the
Cayman Islands. |
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Liquidation Event
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(a) any consolidation, amalgamation or merger of the
Company with or into any person, or any other
corporate reorganization, including a sale or
acquisition of the capital of the Company, in which the
Members immediately before such transaction own less
than 50% of the Companys voting power immediately
after such transaction; |
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(b) a tender offer, take-over bid, arrangement or other
business combination, in which the Members
immediately before such transaction own less than 50%
of the Companys voting power immediately after such
transaction; |
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(c) a sale of all or substantially all of the assets of the
Company; or |
- 3 -
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WORD |
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MEANING |
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(d) the exclusive licensing of all or substantially all of
the intellectual property of the Company to a third party. |
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Member
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a duly registered holder from time to time of the shares in the capital of the
Company. |
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month
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a calendar month. |
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NASD
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National Association of Securities Dealers. |
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NASD Rules
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the rules set forth in the NASD Manual. |
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Notice
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written notice unless otherwise specifically stated and as further defined in these
Articles. |
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Office
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the registered office of the Company for the time being. |
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ordinary resolution
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a resolution shall be an ordinary resolution when it has been passed
by a simple majority of votes cast by such Members as, being entitled so to do, vote in
person or, in the case of any Member being a corporation, by its duly authorised
representative or, where proxies are allowed, by proxy at a general meeting of which
not less than ten (10) clear days Notice has been duly given. |
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paid up
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paid up or credited as paid up. |
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Register
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the principal register and where applicable, any branch register of Members of
the Company to be maintained at such place within or outside the Cayman Islands as the
Board shall determine from time to time. |
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Registration Office
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in respect of any class of share capital such place as the Board may
from time to time determine to keep a branch register of Members in respect of that
class of share capital and where (except in cases where the Board otherwise directs)
the transfers or other documents of title for such class of share capital are to be
lodged for registration and are to be registered. |
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SEC
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the United States Securities and Exchange Commission. |
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Seal
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common seal or any one or more duplicate seals of the |
- 4 -
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WORD |
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MEANING |
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Company (including a securities
seal) for use in the Cayman Islands or in any place outside the Cayman Islands. |
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Secretary
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any person, firm or corporation appointed by the Board to perform any of the
duties of secretary of the Company and includes any assistant, deputy, temporary or
acting secretary. |
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special resolution
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a resolution shall be a special resolution when it has been passed by a
majority of not less than two-thirds of votes cast by such Members as, being entitled
so to do, vote in person or, in the case of such Members as are corporations, by their
respective duly authorised representative or, where proxies are allowed, by proxy at a
general meeting of which not less than ten (10) clear days Notice, specifying (without
prejudice to the power contained in these Articles to amend the same) the intention to
propose the resolution as a special resolution, has been duly given. Provided that,
except in the case of an annual general meeting, if it is so agreed by a majority in
number of the Members having the right to attend and vote at any such meeting, being a
majority together holding not less than sixty-six and two-thirds (66.66) per cent. in
nominal value of the shares giving that right and in the case of an annual general
meeting, if it is so agreed by all Members entitled to attend and vote thereat, a
resolution may be proposed and passed as a special resolution at a meeting of which
less than ten (10) clear days Notice has been given; |
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a special resolution shall be effective for any purpose for
which an ordinary resolution is expressed to be required
under any provision of these Articles or the Statutes. |
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Statutes
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the Law and every other law of the Legislature of the Cayman Islands for the time
being in force applying to or affecting the Company, its Memorandum of Association
and/or these Articles. |
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year
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a calendar year. |
(2) In these Articles, unless there be something within the subject or context inconsistent
with such construction:
- 5 -
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(a) |
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words importing the singular include the plural and vice versa; |
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(b) |
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words importing a gender include both gender and the neuter; |
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(c) |
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words importing persons include companies, associations and bodies of persons
whether corporate or not; |
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(d) |
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the words: |
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(i) |
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may shall be construed as permissive; |
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(ii) |
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shall or will shall be construed as imperative; |
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(e) |
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expressions referring to writing shall, unless the contrary intention appears,
be construed as including printing, lithography, photography and other modes of
representing words or figures in a visible form, and including where the representation
takes the form of electronic display, provided that both the mode of service of the
relevant document or notice and the Members election comply with all applicable
Statutes, rules and regulations; |
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(f) |
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references to any law, ordinance, statute or statutory provision shall be
interpreted as relating to any statutory modification or re-enactment thereof for the
time being in force; |
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(g) |
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save as aforesaid words and expressions defined in the Statutes shall bear the
same meanings in these Articles if not inconsistent with the subject in the context; |
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(h) |
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references to a document being executed include references to it being executed
under hand or under seal or by electronic signature or by any other method and
references to a notice or document include a notice or document recorded or stored in
any digital, electronic, electrical, magnetic or other retrievable form or medium and
information in visible form whether having physical substance or not; |
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(i) |
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Section 8 of the Electronic Transactions Law (2003) of the Cayman Islands, as
amended from time to time, shall not apply to these Articles to the extent it imposes
obligations or requirements in addition to those set out in these Articles. |
SHARE CAPITAL
3. (1) The share capital of the Company at the date on which these Articles come into effect shall
be divided into 50,767,426 Class A Ordinary shares of a par value of HK$1.00 each, 25,298,329 Class
B Ordinary Shares of a par value of HK$1.00 each and 523,934,245 undesignated shares of a par value
of HK$1.00 each which shall have the rights as
- 6 -
determined by the Board in accordance with these Articles. Except as expressly provided in
this Article 3, the Class A Ordinary Shares and the Class B Ordinary Shares shall have the same
rights and privileges and rank equally, share ratably and be identical in all respects as to all
matters.
(2) Subject to the Law, the Companys Memorandum and Articles of Association and, where
applicable, the rules of the Designated Stock Exchange and/or any competent regulatory authority,
any power of the Company to purchase or otherwise acquire its own shares shall be exercisable by
the Board in such manner, upon such terms and subject to such conditions as it thinks fit.
(3) No share shall be issued to bearer.
(4) The Class A Ordinary Shares shall entitle the holder to one vote per share. The Class B
Ordinary Shares shall entitle the holder to ten votes per share.
(5) Each holder of the Class A Ordinary Shares and the Class B Ordinary Shares shall be
entitled to share equally, on a per share basis, in such dividends and other distributions of cash,
property or shares of the Company as may be declared by the Board from time to time; provided,
however, that in the event that such dividend is paid in the form of shares of the Company or
rights to acquire such shares, the holders of Class A Ordinary Shares shall receive Class A
Ordinary Shares or rights to acquire Class A Ordinary Shares, as the case may be, and the holders
of Class B Ordinary Shares shall receive Class B Ordinary Shares or rights to acquire Class B
Ordinary Shares, as the case may be.
(6) In the event of a winding-up or dissolution of the Company, whether voluntary or
involuntary or for the purpose of a reorganization or otherwise or for the purpose of a
reorganization or otherwise or upon any distribution of capital, the holders of Class A Ordinary
Shares and Class B Ordinary Shares shall be entitled to share equally, on a per share basis, the
surplus assets of the Company.
(7) Upon the occurrence of a Liquidation Event, the holders of Class A Ordinary Shares and
Class B Ordinary Shares shall be entitled to share equally, on a per share basis, in the proceeds
of such Liquidation Event. In the event that such proceeds are received by the Company as a result
of such Liquidation Event, the Company shall declare and pay such proceeds to Members of the
Company.
(8) The Class B Ordinary Shares entitle the holder to convert such shares into Class A
Ordinary Shares on a one to one (1:1) basis at any time upon delivery of written notice to the
Board of Directors.
(9) Upon any sale, pledge, transfer, assignment or disposition of Class B Ordinary Shares by a
holder thereof to any person or entity which is not at any time a majority-owned and
majority-controlled subsidiary of Next Decade Investments Limited, Media Partner Technology
Limited, IDG Technology Venture Investment, Inc. or Digital Link Investments Limited, the Class B
Ordinary Shares shall automatically convert into Class A Ordinary Shares (and, for the avoidance of
doubt, at any time such subsequent holder ceases to be a
- 7 -
majority-owned and majority-controlled subsidiary of Next Decade Investments Limited, Media
Partner Technology Limited, IDG Technology Venture Investment, Inc. or Digital Link Investments
Limited, the Class B Ordinary Shares held by such holder shall automatically convert into Class A
Ordinary Shares.
(10) The Class A Ordinary Shares shall generally entitle the holder to enjoy all of the rights
attaching to the Class A Ordinary Shares. The Class B Ordinary Shares shall generally entitle the
holder to enjoy all of the rights attaching to the Class B Ordinary Shares.
ALTERATION OF CAPITAL
4. The Company may from time to time by ordinary resolution in accordance with the Law alter the
conditions of its Memorandum of Association to:
|
(a) |
|
increase its capital by such sum, to be divided into shares of such amounts, as
the resolution shall prescribe; |
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(b) |
|
consolidate and divide all or any of its capital into shares of larger amount
than its existing shares; |
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(c) |
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without prejudice to the powers of the Board under
Article 12, divide its shares into several classes and without prejudice to any special rights previously
conferred on the holders of existing shares attach thereto respectively any
preferential, deferred, qualified or special rights, privileges, conditions or such
restrictions which in the absence of any such determination by the Company in general
meeting, as the Directors may determine provided always that, for the avoidance of
doubt, where a class of shares has been authorized by the Company no resolution of the
Company in general meeting is required for the issuance of shares of that class and the
Directors may issue shares of that class and determine such rights, privileges,
conditions or restrictions attaching thereto as aforesaid, and further provided that]
where the Company issues shares which do not carry voting rights, the words
non-voting shall appear in the designation of such shares and where the equity
capital includes shares with different voting rights, the designation
of each class of shares, other than those with the most favourable voting rights, must include the words
restricted voting or limited voting; |
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(d) |
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sub-divide its shares, or any of them, into shares of smaller amount than is
fixed by the Memorandum of Association (subject, nevertheless, to the Law), and may by
such resolution determine that, as between the holders of the shares resulting from
such sub-division, one or more of the shares may have any such preferred, deferred or
other rights or be subject to any such restrictions as compared with the other or
others as the Company has power to attach to unissued or new shares; |
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(e) |
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cancel any shares which, at the date of the passing of the resolution, have not
been taken, or agreed to be taken, by any person, and diminish the amount of |
- 8 -
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its
capital by the amount of the shares so cancelled or, in the case of shares, without
par value, diminish the number of shares into which its capital is divided. |
5. The Board may settle as it considers expedient any difficulty which arises in relation to any
consolidation and division under the last preceding Article and in particular but without prejudice
to the generality of the foregoing may issue certificates in respect of fractions of shares or
arrange for the sale of the shares representing fractions and the distribution of the net proceeds
of sale (after deduction of the expenses of such sale) in due proportion amongst the Members who
would have been entitled to the fractions, and for this purpose the Board may authorise some person
to transfer the shares representing fractions to their purchaser or resolve that such net proceeds
be paid to the Company for the Companys benefit. Such purchaser will not be bound to see to the
application of the purchase money nor will his title to the shares be affected by any irregularity
or invalidity in the proceedings relating to the sale.
6. The Company may from time to time by special resolution, subject to any confirmation or consent
required by the Law, reduce its share capital or any capital redemption reserve in any manner
permitted by law.
7. Except so far as otherwise provided by the conditions of issue, or by these Articles, any
capital raised by the creation of new shares shall be treated as if it formed part of the original
capital of the Company, and such shares shall be subject to the provisions contained in these
Articles with reference to the payment of calls and instalments, transfer and transmission,
forfeiture, lien, cancellation, surrender, voting and otherwise.
SHARE RIGHTS
8. Subject to the provisions of the Law, the rules of the Designated Stock Exchange and the
Memorandum and Articles of Association and to any special rights conferred on the holders of any
shares or class of shares, and without prejudice to Article 12 hereof, any share in the Company
(whether forming part of the present capital or not) may be issued with or have attached thereto
such rights or restrictions whether in regard to dividend, voting, return of capital or otherwise
as the Board may determine, including without limitation on terms that they may be, or at the
option of the Company or the holder are, liable to be redeemed on such terms and in such manner,
including out of capital, as the Board may deem fit.
9. Subject to the Law, any preferred shares may be issued or converted into shares that, at a
determinable date or at the option of the Company or the holder as the Board may determine.
VARIATION OF RIGHTS
10. Subject to the Law and without prejudice to Article 8, all or any of the special rights
- 9 -
for the
time being attached to the shares or any class of shares may, unless otherwise provided by the
terms of issue of the shares of that class, from time to time (whether or not the Company is being
wound up) be varied, modified or abrogated with the sanction of a special resolution passed at a
separate general meeting of the holders of the shares of that class. To every such separate
general meeting all the provisions of these Articles relating to general meetings of the Company
shall, mutatis mutandis, apply, but so that:
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(a) |
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the necessary quorum (whether at a separate general meeting or at its adjourned
meeting) shall be a person or persons (or in the case of a Member being a corporation,
its duly authorized representative) together holding or representing by proxy not less
than one-third in nominal value of the issued shares of that class; |
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(b) |
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every holder of shares of the class shall be entitled on a poll to one vote for
every such share held by him; and |
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(c) |
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any holder of shares of the class present in person or by proxy or authorised
representative may demand a poll. |
11. The special rights conferred upon the holders of any shares or class of shares shall not,
unless otherwise expressly provided in the rights attaching to or the terms of issue of such
shares, be deemed to be varied, modified or abrogated by the creation or issue of further shares
ranking pari passu therewith.
SHARES
12. (1) Subject to the Law, these Articles and, where applicable, the rules of the Designated Stock
Exchange and without prejudice to any special rights or restrictions for the time being attached to
any shares or any class of shares, with the written consent of the holders of not less than 50.1%
of the issued and outstanding Class B Ordinary Shares, the unissued shares of the Company (whether
forming part of the original or any increased capital) shall be at the disposal of the Board, which
may offer, allot, grant options over or otherwise dispose of them to such persons, at such times
and for such consideration and upon such terms and conditions as the Board may in its absolute
discretion determine but so that no shares shall be issued at a discount. In particular and
without prejudice to the generality of the foregoing, the Board is hereby empowered to authorize by
resolution or resolutions from time to time the issuance of one or more classes or series of
preferred shares and to fix the designations, powers, preferences and relative, participating,
optional and other rights, if any, and the qualifications, limitations and restrictions thereof, if
any, including, without limitation, the number of shares constituting each such class or series,
dividend rights, conversion rights, redemption privileges, voting powers, full or limited or no
voting powers, and liquidation preferences, and to increase or decrease the size of any such class
or series (but not below the number of shares of any class or series of preferred shares then
outstanding) to the extent permitted by Law. Without limiting the generality of the foregoing, the
resolution or resolutions providing for the establishment of any class or series
of preferred shares may, to the extent permitted by law, provide that such class or series
- 10 -
shall be
superior to, rank equally with or be junior to the preferred shares of any other class or series.
(2) Neither the Company nor the Board shall be obliged, when making or granting any allotment
of, offer of, option over or disposal of shares, to make, or make available, any such allotment,
offer, option or shares to Members or others with registered addresses in any particular territory
or territories being a territory or territories where, in the absence of a registration statement
or other special formalities, this would or might, in the opinion of the Board, be unlawful or
impracticable. Members affected as a result of the foregoing sentence shall not be, or be deemed
to be, a separate class of members for any purpose whatsoever. Except as otherwise expressly
provided in the resolution or resolutions providing for the establishment of any class or series of
preferred shares, no vote of the holders of preferred shares of or ordinary shares shall be a
prerequisite to the issuance of any shares of any class or series of the preferred shares
authorized by and complying with the conditions of the Memorandum and Articles of Association.
(3) The Board may issue options, warrants or convertible securities or securities of similar
nature conferring the right upon the holders thereof to subscribe for, purchase or receive any
class of shares or securities in the capital of the Company on such terms as it may from time to
time determine.
13. The Company may in connection with the issue of any shares exercise all powers of paying
commission and brokerage conferred or permitted by the Law. Subject to the Law, the commission may
be satisfied by the payment of cash or by the allotment of fully or partly paid shares or partly in
one and partly in the other.
14. Except as required by law, no person shall be recognised by the Company as holding any share
upon any trust and the Company shall not be bound by or required in any way to recognise (even when
having notice thereof) any equitable, contingent, future or partial interest in any share or any
fractional part of a share or (except only as otherwise provided by these Articles or by law) any
other rights in respect of any share except an absolute right to the entirety thereof in the
registered holder.
15. Subject to the Law and these Articles, the Board may at any time after the allotment of shares
but before any person has been entered in the Register as the holder, recognise a renunciation
thereof by the allottee in favour of some other person and may accord to any allottee of a share a
right to effect such renunciation upon and subject to such terms and conditions as the Board
considers fit to impose.
SHARE CERTIFICATES
16. Every share certificate shall be issued under the Seal or a facsimile thereof and shall specify
the number and class and distinguishing numbers (if any) of the shares to which it relates, and the
amount paid up thereon and may otherwise be in such form as the Directors may from time to time
determine. No certificate shall be issued representing shares of
more than one class. The Board may by resolution determine, either generally or in any
- 11 -
particular
case or cases, that any signatures on any such certificates (or certificates in respect of other
securities) need not be autographic but may be affixed to such certificates by some mechanical
means or may be printed thereon.
17. (1) In the case of a share held jointly by several persons, the Company shall not be bound to
issue more than one certificate therefor and delivery of a certificate to one of several joint
holders shall be sufficient delivery to all such holders.
(2) Where a share stands in the names of two or more persons, the person first named in the
Register shall as regards service of notices and, subject to the provisions of these Articles, all
or any other matters connected with the Company, except the transfer of the shares, be deemed the
sole holder thereof.
18. Every person whose name is entered, upon an allotment of shares, as a Member in the Register
shall be entitled, without payment, to receive one certificate for all such shares of any one class
or several certificates each for one or more of such shares of such class upon payment for every
certificate after the first of such reasonable out-of-pocket expenses as the Board from time to
time determines.
19. Share certificates shall be issued within the relevant time limit as prescribed by the Law or
as the Designated Stock Exchange may from time to time determine, whichever is the shorter, after
allotment or, except in the case of a transfer which the Company is for the time being entitled to
refuse to register and does not register, after lodgment of a transfer with the Company.
20. (1) Upon every transfer of shares the certificate held by the transferor shall be given up to
be cancelled, and shall forthwith be cancelled accordingly, and a new certificate shall be issued
to the transferee in respect of the shares transferred to him at such fee as is provided in
paragraph (2) of this Article. If any of the shares included in the certificate so given up shall
be retained by the transferor a new certificate for the balance shall be issued to him at the
aforesaid fee payable by the transferor to the Company in respect thereof.
(2) The fee referred to in paragraph (1) above shall be an amount not exceeding the relevant
maximum amount as the Designated Stock Exchange may from time to time determine provided that the
Board may at any time determine a lower amount for such fee.
21. If a share certificate shall be damaged or defaced or alleged to have been lost, stolen or
destroyed a new certificate representing the same shares may be issued to the relevant Member upon
request and on payment of such fee as the Company may determine and, subject to compliance with
such terms (if any) as to evidence and indemnity and to payment of the costs and reasonable
out-of-pocket expenses of the Company in investigating such evidence and preparing such indemnity
as the Board may think fit and, in case of damage or defacement, on delivery of the old certificate
to the Company provided always that where share warrants have been issued, no new share warrant
shall be issued to replace one that has been lost unless the Board has determined that the original
has been destroyed.
- 12 -
LIEN
22. The Company shall have a first and paramount lien on every share (not being a fully paid share)
for all moneys (whether presently payable or not) called or payable at a fixed time in respect of
that share. The Company shall also have a first and paramount lien on every share (not being a
fully paid share) registered in the name of a Member (whether or not jointly with other Members)
for all amounts of money presently payable by such Member or his estate to the Company whether the
same shall have been incurred before or after notice to the Company of any equitable or other
interest of any person other than such member, and whether the period for the payment or discharge
of the same shall have actually arrived or not, and notwithstanding that the same are joint debts
or liabilities of such Member or his estate and any other person, whether a Member of the Company
or not. The Companys lien on a share shall extend to all dividends or other moneys payable
thereon or in respect thereof. The Board may at any time, generally or in any particular case,
waive any lien that has arisen or declare any share exempt in whole or in part, from the provisions
of this Article.
23. Subject to these Articles, the Company may sell in such manner as the Board determines any
share on which the Company has a lien, but no sale shall be made unless some sum in respect of
which the lien exists is presently payable, or the liability or engagement in respect of which such
lien exists is liable to be presently fulfilled or discharged nor until the expiration of fourteen
(14) clear days after a notice in writing, stating and demanding payment of the sum presently
payable, or specifying the liability or engagement and demanding fulfilment or discharge thereof
and giving notice of the intention to sell in default, has been served on the registered holder for
the time being of the share or the person entitled thereto by reason of his death or bankruptcy.
24. The net proceeds of the sale shall be received by the Company and applied in or towards payment
or discharge of the debt or liability in respect of which the lien exists, so far as the same is
presently payable, and any residue shall (subject to a like lien for debts or liabilities not
presently payable as existed upon the share prior to the sale) be paid to the person entitled to
the share at the time of the sale. To give effect to any such sale the Board may authorise some
person to transfer the shares sold to the purchaser thereof. The purchaser shall be registered as
the holder of the shares so transferred and he shall not be bound to see to the application of the
purchase money, nor shall his title to the shares be affected by any irregularity or invalidity in
the proceedings relating to the sale.
CALLS ON SHARES
25. Subject to these Articles and to the terms of allotment, the Board may from time to time make
calls upon the Members in respect of any moneys unpaid on their shares (whether on account of the
nominal value of the shares or by way of premium), and each Member shall (subject to being given at
least fourteen (14) clear days Notice specifying the time and place of payment) pay to the Company
as required by such notice the amount called on his shares. A call may be extended, postponed or
revoked in whole or in part as
the Board determines but no member shall be entitled to any such extension, postponement
- 13 -
or
revocation except as a matter of grace and favour.
26. A call shall be deemed to have been made at the time when the resolution of the Board
authorising the call was passed and may be made payable either in one lump sum or by instalments.
27. A person upon whom a call is made shall remain liable for calls made upon him notwithstanding
the subsequent transfer of the shares in respect of which the call was made. The joint holders of
a share shall be jointly and severally liable to pay all calls and instalments due in respect
thereof or other moneys due in respect thereof.
28. If a sum called in respect of a share is not paid before or on the day appointed for payment
thereof, the person from whom the sum is due shall pay interest on the amount unpaid from the day
appointed for payment thereof to the time of actual payment at such rate (not exceeding twenty per
cent. (20%) per annum) as the Board may determine, but the Board may in its absolute discretion
waive payment of such interest wholly or in part.
29. No Member shall be entitled to receive any dividend or bonus or to be present and vote (save as
proxy for another Member) at any general meeting either personally or by proxy, or be reckoned in a
quorum, or exercise any other privilege as a Member until all calls or instalments due by him to
the Company, whether alone or jointly with any other person, together with interest and expenses
(if any) shall have been paid.
30. On the trial or hearing of any action or other proceedings for the recovery of any money due
for any call, it shall be sufficient to prove that the name of the Member sued is entered in the
Register as the holder, or one of the holders, of the shares in respect of which such debt accrued,
that the resolution making the call is duly recorded in the minute book, and that notice of such
call was duly given to the Member sued, in pursuance of these Articles; and it shall not be
necessary to prove the appointment of the Directors who made such call, nor any other matters
whatsoever, but the proof of the matters aforesaid shall be conclusive evidence of the debt.
31. Any amount payable in respect of a share upon allotment or at any fixed date, whether in
respect of nominal value or premium or as an instalment of a call, shall be deemed to be a call
duly made and payable on the date fixed for payment and if it is not paid the provisions of these
Articles shall apply as if that amount had become due and payable by virtue of a call duly made and
notified.
32. On the issue of shares the Board may differentiate between the allottees or holders as to the
amount of calls to be paid and the times of payment.
33. The Board may, if it thinks fit, receive from any Member willing to advance the same, and
either in money or moneys worth, all or any part of the moneys uncalled and unpaid or instalments
payable upon any shares held by him and upon all or any of the moneys so advanced (until the same
would, but for such advance, become presently payable) pay interest at such rate (if any) as the
Board may decide. The Board may at any
time repay the amount so advanced upon giving to such Member not less than one months
- 14 -
Notice of
its intention in that behalf, unless before the expiration of such notice the amount so advanced
shall have been called up on the shares in respect of which it was advanced. Such payment in
advance shall not entitle the holder of such share or shares to participate in respect thereof in a
dividend subsequently declared.
FORFEITURE OF SHARES
34. (1) If a call remains unpaid after it has become due and payable the Board may give to the
person from whom it is due not less than fourteen (14) clear days Notice:
|
(a) |
|
requiring payment of the amount unpaid together with any interest which may
have accrued and which may still accrue up to the date of actual payment; and |
|
|
(b) |
|
stating that if the Notice is not complied with the shares on which the call
was made will be liable to be forfeited. |
(2) If the requirements of any such Notice are not complied with, any share in respect of
which such Notice has been given may at any time thereafter, before payment of all calls and
interest due in respect thereof has been made, be forfeited by a resolution of the Board to that
effect, and such forfeiture shall include all dividends and bonuses declared in respect of the
forfeited share but not actually paid before the forfeiture.
35. When any share has been forfeited, notice of the forfeiture shall be served upon the person who
was before forfeiture the holder of the share. No forfeiture shall be invalidated by any omission
or neglect to give such Notice.
36. The Board may accept the surrender of any share liable to be forfeited hereunder and, in such
case, references in these Articles to forfeiture will include surrender.
37. Any share so forfeited shall be deemed the property of the Company and may be sold, re-allotted
or otherwise disposed of to such person, upon such terms and in such manner as the Board
determines, and at any time before a sale, re-allotment or disposition the forfeiture may be
annulled by the Board on such terms as the Board determines.
38. A person whose shares have been forfeited shall cease to be a Member in respect of the
forfeited shares but nevertheless shall remain liable to pay the Company all moneys which at the
date of forfeiture were presently payable by him to the Company in respect of the shares, with (if
the Directors shall in their discretion so require) interest thereon from the date of forfeiture
until payment at such rate (not exceeding twenty per cent. (20%) per annum) as the Board
determines. The Board may enforce payment thereof if it thinks fit, and without any deduction or
allowance for the value of the forfeited shares, at the date of forfeiture, but his liability shall
cease if and when the Company shall have received payment in full of all such moneys in respect of
the shares. For the purposes of this Article any sum which, by the terms of issue of a share, is
payable thereon at a fixed time which is subsequent to the date of forfeiture, whether on account
of the nominal value of the share or
- 15 -
by way of premium, shall notwithstanding that time has not yet arrived be deemed to be payable at
the date of forfeiture, and the same shall become due and payable immediately upon the forfeiture,
but interest thereon shall only be payable in respect of any period between the said fixed time and
the date of actual payment.
39. A declaration by a Director or the Secretary that a share has been forfeited on a specified
date shall be conclusive evidence of the facts therein stated as against all persons claiming to be
entitled to the share, and such declaration shall (subject to the execution of an instrument of
transfer by the Company if necessary) constitute a good title to the share, and the person to whom
the share is disposed of shall be registered as the holder of the share and shall not be bound to
see to the application of the consideration (if any), nor shall his title to the share be affected
by any irregularity in or invalidity of the proceedings in reference to the forfeiture, sale or
disposal of the share. When any share shall have been forfeited, notice of the declaration shall
be given to the Member in whose name it stood immediately prior to the forfeiture, and an entry of
the forfeiture, with the date thereof, shall forthwith be made in the register, but no forfeiture
shall be in any manner invalidated by any omission or neglect to give such notice or make any such
entry.
40. Notwithstanding any such forfeiture as aforesaid the Board may at any time, before any shares
so forfeited shall have been sold, re-allotted or otherwise disposed of, permit the shares
forfeited to be bought back upon the terms of payment of all calls and interest due upon and
expenses incurred in respect of the share, and upon such further terms (if any) as it thinks fit.
41. The forfeiture of a share shall not prejudice the right of the Company to any call already made
or instalment payable thereon.
42. The provisions of these Articles as to forfeiture shall apply in the case of non-payment of any
sum which, by the terms of issue of a share, becomes payable at a fixed time, whether on account of
the nominal value of the share or by way of premium, as if the same had been payable by virtue of a
call duly made and notified.
REGISTER OF MEMBERS
43. (1) The Company shall keep in one or more books a Register of its Members and shall enter
therein the following particulars, that is to say:
|
(a) |
|
the name and address of each Member, the number and class of shares held by him
and the amount paid or agreed to be considered as paid on such shares; |
|
|
(b) |
|
the date on which each person was entered in the Register; and |
|
|
(c) |
|
the date on which any person ceased to be a Member. |
|
|
(2) |
|
The Company may keep an overseas or local or other branch register of |
-16-
Members resident in any place, and the Board may make and vary such regulations as it
determines in respect of the keeping of any such register and maintaining a Registration Office in
connection therewith. The Register and branch register(s) shall together be treated as the
Register for the purposes of these Articles.
44. The Register and branch register of Members, as the case may be, shall be open to inspection
for such times and on such days as the Board shall determine by Members without charge or by any
other person, upon a maximum payment of US$2.50 or such other sum specified by the Board, at the
Office or Registration Office or such other place at which the Register is kept in accordance with
the Law. The Register including any overseas or local or other branch register of Members may,
after compliance with any notice requirement of the Designated Stock Exchange, be closed at such
times or for such periods not exceeding in the whole thirty (30) days in each year as the Board may
determine and either generally or in respect of any class of shares.
RECORD DATES
45. For the purpose of determining the Members entitled to notice of or to vote at any general
meeting, or any adjournment thereof, or entitled to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other distribution or
allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or
exchange of shares or for the purpose of any other lawful action, the Board may fix, in advance, a
date as the record date for any such determination of Members, which date shall not be more than
sixty (60) days nor less than ten (10) days before the date of such meeting, nor more than sixty
(60) days prior to any other such action.
If the Board does not fix a record date for any general meeting, the record date for
determining the Members entitled to a notice of or to vote at such meeting shall be at the close of
business on the day next preceding the day on which notice is given, or, if in accordance with
these Articles notice is waived, at the close of business on the day next preceding the day on
which the meeting is held. If corporate action without a general meeting is to be taken, the
record date for determining the Members entitled to express consent to such corporate action in
writing, when no prior action by the Board is necessary, shall be the first date on which a signed
written consent setting forth the action taken or proposed to be taken is delivered to the Company
by delivery to its head office. The record date for determining the Members for any other purpose
shall be at the close of business on the day on which the Board adopts the resolution relating
thereto.
A determination of the Members of record entitled to notice of or to vote at a meeting of the
Members shall apply to any adjournment of the meeting; provided, however, that the Board may fix a
new record date for the adjourned meeting.
TRANSFER OF SHARES
46. Subject to these Articles, any Member may transfer all or any of his shares by an
-17-
instrument of transfer in the usual or common form or in a form prescribed by the Designated Stock
Exchange or in any other form approved by the Board and may be under hand or, if the transferor or
transferee is a clearing house or a central depository house or its nominee(s), by hand or by
machine imprinted signature or by such other manner of execution as the Board may approve from time
to time.
47. The instrument of transfer shall be executed by or on behalf of the transferor and the
transferee provided that the Board may dispense with the execution of the instrument of transfer by
the transferee in any case which it thinks fit in its discretion to do so. Without prejudice to
the last preceding Article, the Board may also resolve, either generally or in any particular case,
upon request by either the transferor or transferee, to accept mechanically executed transfers.
The transferor shall be deemed to remain the holder of the share until the name of the transferee
is entered in the Register in respect thereof. Nothing in these Articles shall preclude the Board
from recognising a renunciation of the allotment or provisional allotment of any share by the
allottee in favour of some other person.
48. (1) The Board may, in its absolute discretion, and without giving any reason therefor, refuse
to register a transfer of any share (not being a fully paid up share) to a person of whom it does
not approve, or any share issued under any share incentive scheme for employees upon which a
restriction on transfer imposed thereby still subsists, and it may also, without prejudice to the
foregoing generality, refuse to register a transfer of any share to more than four joint holders or
a transfer of any share (not being a fully paid up share) on which the Company has a lien.
(2) The Board in so far as permitted by any applicable law may, in its absolute discretion, at
any time and from time to time transfer any share upon the Register to any branch register or any
share on any branch register to the Register or any other branch register. In the event of any
such transfer, the shareholder requesting such transfer shall bear the cost of effecting the
transfer unless the Board otherwise determines.
(3) Unless the Board otherwise agrees (which agreement may be on such terms and subject to
such conditions as the Board in its absolute discretion may from time to time determine, and which
agreement the Board shall, without giving any reason therefor, be entitled in its absolute
discretion to give or withhold), no shares upon the Register shall be transferred to any branch
register nor shall shares on any branch register be transferred to the Register or any other branch
register and all transfers and other documents of title shall be lodged for registration, and
registered, in the case of any shares on a branch register, at the relevant Registration Office,
and, in the case of any shares on the Register, at the Office or such other place at which the
Register is kept in accordance with the Law.
49. Without limiting the generality of the last preceding Article, the Board may decline to
recognise any instrument of transfer unless:-
|
(a) |
|
a fee of such maximum sum as the Designated Stock Exchange may determine to be
payable or such lesser sum as the Board may from time to time require is paid to the
Company in respect thereof; |
-18-
|
(b) |
|
the instrument of transfer is in respect of only one class of share; |
|
|
(c) |
|
the instrument of transfer is lodged at the Office or such other place at which
the Register is kept in accordance with the Law or the Registration Office (as the case
may be) accompanied by the relevant share certificate(s) and such other evidence as the
Board may reasonably require to show the right of the transferor to make the transfer
(and, if the instrument of transfer is executed by some other person on his behalf, the
authority of that person so to do); and |
|
|
(d) |
|
if applicable, the instrument of transfer is duly and properly stamped. |
50. If the Board refuses to register a transfer of any share, it shall, within three months after
the date on which the transfer was lodged with the Company, send to each of the transferor and
transferee notice of the refusal.
51. The registration of transfers of shares or of any class of shares may, after compliance with
any notice requirement of the Designated Stock Exchange, be suspended at such times and for such
periods (not exceeding in the whole thirty (30) days in any year) as the Board may determine.
TRANSMISSION OF SHARES
52. If a Member dies, the survivor or survivors where the deceased was a joint holder, and his
legal personal representatives where he was a sole or only surviving holder, will be the only
persons recognised by the Company as having any title to his interest in the shares; but nothing in
this Article will release the estate of a deceased Member (whether sole or joint) from any
liability in respect of any share which had been solely or jointly held by him.
53. Any person becoming entitled to a share in consequence of the death or bankruptcy or winding-up
of a Member may, upon such evidence as to his title being produced as may be required by the Board,
elect either to become the holder of the share or to have some person nominated by him registered
as the transferee thereof. If he elects to become the holder he shall notify the Company in
writing either at the Registration Office or Office, as the case may be, to that effect. If he
elects to have another person registered he shall execute a transfer of the share in favour of that
person. The provisions of these Articles relating to the transfer and registration of transfers of
shares shall apply to such notice or transfer as aforesaid as if the death or bankruptcy of the
Member had not occurred and the notice or transfer were a transfer signed by such Member.
54. A person becoming entitled to a share by reason of the death or bankruptcy or winding-up of a
Member shall be entitled to the same dividends and other advantages to which he would be entitled
if he were the registered holder of the share. However, the Board may, if it thinks fit, withhold
the payment of any dividend payable or other advantages in respect of such share until such person
shall become the registered holder of the share or shall have effectually transferred such share,
but, subject to the requirements of Article 75(2) being met, such a person may vote at meetings.
-19-
UNTRACEABLE MEMBERS
55. (1) Without prejudice to the rights of the Company under paragraph (2) of this Article, the
Company may cease sending cheques for dividend entitlements or dividend warrants by post if such
cheques or warrants have been left uncashed on two consecutive occasions. However, the Company may
exercise the power to cease sending cheques for dividend entitlements or dividend warrants after
the first occasion on which such a cheque or warrant is returned undelivered.
(2) The Company shall have the power to sell, in such manner as the Board thinks fit, any
shares of a Member who is untraceable, but no such sale shall be made unless:
|
(a) |
|
all cheques or warrants in respect of dividends of the shares in question,
being not less than three in total number, for any sum payable in cash to the holder of
such shares in respect of them sent during the relevant period in the manner authorised
by the Articles of the Company have remained uncashed; |
|
|
(b) |
|
so far as it is aware at the end of the relevant period, the Company has not at
any time during the relevant period received any indication of the existence of the
Member who is the holder of such shares or of a person entitled to such shares by
death, bankruptcy or operation of law; and |
|
|
(c) |
|
the Company, if so required by the rules governing the listing of shares on the
Designated Stock Exchange, has given notice to, and caused advertisement in newspapers
to be made in accordance with the requirements of, the Designated Stock Exchange of its
intention to sell such shares in the manner required by the Designated Stock Exchange,
and a period of three months or such shorter period as may be allowed by the Designated
Stock Exchange has elapsed since the date of such advertisement. |
For the purpose of the foregoing, the relevant period means the period commencing twelve
(12) years before the date of publication of the advertisement referred to in paragraph (c) of this
Article and ending at the expiry of the period referred to in that paragraph.
(3) To give effect to any such sale the Board may authorise some person to transfer the said
shares and an instrument of transfer signed or otherwise executed by or on behalf of such person
shall be as effective as if it had been executed by the registered holder or the person entitled by
transmission to such shares, and the purchaser shall not be bound to see to the application of the
purchase money nor shall his title to the shares be affected by any irregularity or invalidity in
the proceedings relating to the sale. The net proceeds of the sale will belong to the Company and
upon receipt by the Company of such net proceeds it shall become indebted to the former Member for
an amount equal to such net proceeds. No trust shall be created in respect of such debt and no
interest shall be payable in respect of it and the Company shall not be required to account for any
money earned from the net
-20-
proceeds which may be employed in the business of the Company or as it thinks fit. Any sale under
this Article shall be valid and effective notwithstanding that the Member holding the shares sold
is dead, bankrupt or otherwise under any legal disability or incapacity.
GENERAL MEETINGS
56. An annual general meeting of the Company shall be held in each year other than the year in
which these Articles were adopted at such time and place as may be determined by the Board.
57. Each general meeting, other than an annual general meeting, shall be called an extraordinary
general meeting. General meetings may be held at such times and in any location in the world as
may be determined by the Board.
58. (1) Subject to the provisions of paragraph (2) of this Article below, only a majority of the
Board or the Chairman of the Board may call extraordinary general meetings, which extraordinary
general meetings shall be held at such times and locations (as permitted hereby) as such person or
persons shall determine.
(2) General meetings shall also be convened on the requisition in writing of any Member or
Members entitled to attend and vote at general meetings of the Company holding at least 20 percent
of the paid up voting share capital of the Company deposited at the Office specifying the objects
of the meeting for a date no later than 21 days from the date of deposit of the requisition signed
by the requisitionists, and if the Directors do not convene such meeting for a date not later than
45 days after the date of such deposit, the requisitionists themselves may convene the general
meeting in the same manner, as nearly as possible, as that in which general meetings may be
convened by the Directors, and all reasonable expenses incurred by the requisitionists as a result
of the failure of the Directors to convene the general meeting shall be reimbursed to them by the
Company.
NOTICE OF GENERAL MEETINGS
59. (1) An annual general meeting and any extraordinary general meeting may be called by not less
than ten (10) clear days Notice but a general meeting may be called by shorter notice, subject to
the Law, if it is so agreed:
|
(a) |
|
in the case of a meeting called as an annual general meeting, by all the
Members entitled to attend and vote thereat; and |
|
|
(b) |
|
in the case of any other meeting, by a majority in number of the Members having
the right to attend and vote at the meeting, being a majority together holding not less
than sixty-six and two-thirds per cent. (66.66%) in nominal value of the issued shares
giving that right. |
(2) The notice shall specify the time and place of the meeting and, in case of special
-21-
business (as defined in Article 61), the general nature of the business. The notice convening an
annual general meeting shall specify the meeting as such and the notice convening a meeting to pass
a Special Resolution shall specify the intention to propose the resolution as a Special Resolution.
Notice of every general meeting shall be given to all Members other than to such Members as, under
the provisions of these Articles or the terms of issue of the shares they hold, are not entitled to
receive such notices from the Company, to all persons entitled to a share in consequence of the
death or bankruptcy or winding-up of a Member and to each of the Directors and the Auditors.
60. The accidental omission to give Notice of a meeting or (in cases where instruments of proxy are
sent out with the Notice) to send such instrument of proxy to, or the non-receipt of such Notice or
such instrument of proxy by, any person entitled to receive such Notice shall not invalidate any
resolution passed or the proceedings at that meeting.
PROCEEDINGS AT GENERAL MEETINGS
61. (1) All business shall be deemed special that is transacted at an extraordinary general
meeting, and also all business that is transacted at an annual general meeting, with the exception
of the followings which shall be deemed ordinary business:
|
(a) |
|
the declaration and sanctioning of dividends; |
|
|
(b) |
|
consideration and adoption of the accounts and balance sheet and the reports of
the Directors and Auditors and other documents required to be annexed to the balance
sheet; and |
|
|
(c) |
|
the election of Directors. |
(2) No business other than the appointment of a chairman of a meeting shall be transacted at
any general meeting unless a quorum is present at the commencement of the business. At any general
meeting of the Company, two (2) Members entitled to vote and present in person or by proxy or (in
the case of a Member being a corporation) by its duly authorised representative representing shares
carrying a majority of the rights to vote of all rights of all shares entitled to attend and vote
at the meeting throughout the meeting shall form a quorum for all purposes.
(3) Shareholders may participate in any general meeting by means of a conference telephone or
other communications equipment through which all persons participating in the meeting can
communicate with each other simultaneously and instantaneously and, for the purpose of counting a
quorum, such participation shall constitute presence at a meeting as if those participating were
present in person.
62. If within thirty (30) minutes (or such longer time not exceeding one hour as the chairman of
the meeting may determine to wait) after the time appointed for the meeting a quorum is not
present, the meeting shall stand adjourned to the same day in the next week at the same time and
place or to such time and place as the Board may determine. If at
-22-
such adjourned meeting a quorum is not present within half an hour from the time appointed for
holding the meeting, the meeting shall be dissolved.
63. The chairman of the Company shall preside as chairman at every general meeting. If at any
meeting the chairman is not present within fifteen (15) minutes after the time appointed for
holding the meeting, or is not willing to act as chairman, the Directors present shall choose one
of their number to act, or if one Director only is present he shall preside as chairman if willing
to act. If no Director is present, or if each of the Directors present declines to take the chair,
or if the chairman chosen shall retire from the chair, the Members present in person or by proxy
and entitled to vote shall elect one of their number to be chairman.
64. The chairman may adjourn the meeting from time to time and from place to place, but no business
shall be transacted at any adjourned meeting other than the business which might lawfully have been
transacted at the meeting had the adjournment not taken place. When a meeting is adjourned for
fourteen (14) days or more, at least seven (7) clear days notice of the adjourned meeting shall be
given specifying the time and place of the adjourned meeting but it shall not be necessary to
specify in such notice the nature of the business to be transacted at the adjourned meeting and the
general nature of the business to be transacted. Save as aforesaid, it shall be unnecessary to
give notice of an adjournment.
65. If an amendment is proposed to any resolution under consideration but is in good faith ruled
out of order by the chairman of the meeting, the proceedings on the substantive resolution shall
not be invalidated by any error in such ruling. In the case of a resolution duly proposed as a
special resolution, no amendment thereto (other than a mere clerical amendment to correct a patent
error) may in any event be considered or voted upon.
VOTING
66. Subject to any special rights or restrictions as to voting for the time being attached to any
shares by or in accordance with these Articles (including, without prejudice to the generality of
the foregoing, the rights of the Class B Ordinary Shares), at any general meeting on a show of
hands every Member present in person (or being a corporation, is present by a duly authorised
representative), or by proxy shall have one vote and on a poll every Member present in person or by
proxy or, in the case of a Member being a corporation, by its duly authorised representative shall
have one vote for every fully paid share of which he is the holder but so that no amount paid up or
credited as paid up on a share in advance of calls or instalments is treated for the foregoing
purposes as paid up on the share. Notwithstanding anything contained in these Articles, where more
than one proxy is appointed by a Member which is a clearing house or a central depository house (or
its nominee(s)), each such proxy shall have one vote on a show of hands. A resolution put to the
vote of a meeting shall be decided on a show of hands unless (before or on the declaration of the
result of the show of hands or on the withdrawal of any other demand for a poll) a poll is demanded
by the chairman of such meeting or by any one Member present in person or in the case of a Member
being a corporation by its duly authorised representative or by proxy for the time being entitled
to vote at the meeting. A demand by
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a person as proxy for a Member or in the case of a Member being a corporation by its duly
authorised representative shall be deemed to be the same as a demand by a Member.
67. Unless a poll is duly demanded and the demand is not withdrawn, a declaration by the chairman
that a resolution has been carried, or carried unanimously, or by a particular majority, or not
carried by a particular majority, or lost, and an entry to that effect made in the minute book of
the Company, shall be conclusive evidence of the facts without proof of the number or proportion of
the votes recorded for or against the resolution.
68. If a poll is duly demanded the result of the poll shall be deemed to be the resolution of the
meeting at which the poll was demanded. There shall be no requirement for the chairman to disclose
the voting figures on a poll.
69. A poll demanded on the election of a chairman, or on a question of adjournment, shall be
taken forthwith. A poll demanded on any other question shall be taken in such manner (including
the use of ballot or voting papers or tickets) and either forthwith or at such time (being not
later than thirty (30) days after the date of the demand) and place as the chairman directs. It
shall not be necessary (unless the chairman otherwise directs) for notice to be given of a poll not
taken immediately.
70. The demand for a poll shall not prevent the continuance of a meeting or the transaction of any
business other than the question on which the poll has been demanded, and, with the consent of the
chairman, it may be withdrawn at any time before the close of the meeting or the taking of the
poll, whichever is the earlier.
71. On a poll votes may be given either personally or by proxy.
72. A person entitled to more than one vote on a poll need not use all his votes or cast all the
votes he uses in the same way.
73. All questions submitted to a meeting shall be decided by a simple majority of votes except
where a greater majority is required by these Articles or by the Law. In the case of an equality of
votes, whether on a show of hands or on a poll, the chairman of such meeting shall be entitled to a
second or casting vote in addition to any other vote he may have.
74. Where there are joint holders of any share any one of such joint holder may vote, either in
person or by proxy, in respect of such share as if he were solely entitled thereto, but if more
than one of such joint holders be present at any meeting the vote of the senior who tenders a vote,
whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint
holders, and for this purpose seniority shall be determined by the order in which the names stand
in the Register in respect of the joint holding. Several executors or administrators of a deceased
Member in whose name any share stands shall for the purposes of this Article be deemed joint
holders thereof.
75. (1) A Member who is a patient for any purpose relating to mental health or in respect of whom
an order has been made by any court having jurisdiction for the protection or management of the
affairs of persons incapable of managing their own affairs may vote,
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whether on a show of hands or on a poll, by his receiver, committee, curator bonis or other person
in the nature of a receiver, committee or curator bonis appointed by such court, and such receiver,
committee, curator bonis or other person may vote on a poll by proxy, and may otherwise act and be
treated as if he were the registered holder of such shares for the purposes of general meetings,
provided that such evidence as the Board may require of the authority of the person claiming to
vote shall have been deposited at the Office, head office or Registration Office, as appropriate,
not less than forty-eight (48) hours before the time appointed for holding the meeting, or
adjourned meeting or poll, as the case may be.
(2) Any person entitled under Article 53 to be registered as the holder of any shares may vote
at any general meeting in respect thereof in the same manner as if he were the registered holder of
such shares, provided that forty-eight (48) hours at least before the time of the holding of the
meeting or adjourned meeting, as the case may be, at which he proposes to vote, he shall satisfy
the Board of his entitlement to such shares, or the Board shall have previously admitted his right
to vote at such meeting in respect thereof.
76. No Member shall, unless the Board otherwise determines, be entitled to attend and vote and to
be reckoned in a quorum at any general meeting unless he is duly registered and all calls or other
sums presently payable by him in respect of shares in the Company have been paid.
77. If:
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(a) |
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any objection shall be raised to the qualification of any voter; or |
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(b) |
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any votes have been counted which ought not to have been counted or which might
have been rejected; or |
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(c) |
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any votes are not counted which ought to have been counted; |
the objection or error shall not vitiate the decision of the meeting or adjourned meeting on
any resolution unless the same is raised or pointed out at the meeting or, as the case may be, the
adjourned meeting at which the vote objected to is given or tendered or at which the error occurs.
Any objection or error shall be referred to the chairman of the meeting and shall only vitiate the
decision of the meeting on any resolution if the chairman decides that the same may have affected
the decision of the meeting. The decision of the chairman on such matters shall be final and
conclusive.
PROXIES
78. Any Member entitled to attend and vote at a meeting of the Company shall be entitled to appoint
another person as his proxy to attend and vote instead of him. A Member who is the holder of two
or more shares may appoint more than one proxy to represent him and vote on his behalf at a general
meeting of the Company or at a class meeting. A proxy need not be a Member. In addition, a proxy
or proxies representing either a Member who is an individual or a Member which is a corporation
shall be entitled
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to exercise the same powers on behalf of the Member which he or they represent as such Member could
exercise.
79. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his
attorney duly authorised in writing or, if the appointor is a corporation, either under its seal or
under the hand of an officer, attorney or other person authorised to sign the same. In the case of
an instrument of proxy purporting to be signed on behalf of a corporation by an officer thereof it
shall be assumed, unless the contrary appears, that such officer was duly authorised to sign such
instrument of proxy on behalf of the corporation without further evidence of the facts.
80. The instrument appointing a proxy and (if required by the Board) the power of attorney
or other authority (if any) under which it is signed, or a certified copy of such power or
authority, shall be delivered to such place or one of such places (if any) as may be specified for
that purpose in or by way of note to or in any document accompanying the notice convening the
meeting (or, if no place is so specified at the Registration Office or the Office, as may be
appropriate) not less than forty-eight (48) hours before the time appointed for holding the meeting
or adjourned meeting at which the person named in the instrument proposes to vote or, in the case
of a poll taken subsequently to the date of a meeting or adjourned meeting, not less than
twenty-four (24) hours before the time appointed for the taking of the poll and in default the
instrument of proxy shall not be treated as valid. No instrument appointing a proxy shall be valid
after the expiration of twelve (12) months from the date named in it as the date of its execution,
except at an adjourned meeting or on a poll demanded at a meeting or an adjourned meeting in cases
where the meeting was originally held within twelve (12) months from such date. Delivery of an
instrument appointing a proxy shall not preclude a Member from attending and voting in person at
the meeting convened and in such event, the instrument appointing a proxy shall be deemed to be
revoked.
81. Instruments of proxy shall be in any common form or in such other form as the Board may approve
(provided that this shall not preclude the use of the two-way form) and the Board may, if it thinks
fit, send out with the notice of any meeting forms of instrument of proxy for use at the meeting.
The instrument of proxy shall be deemed to confer authority to demand or join in demanding a poll
and to vote on any amendment of a resolution put to the meeting for which it is given as the proxy
thinks fit. The instrument of proxy shall, unless the contrary is stated therein, be valid as well
for any adjournment of the meeting as for the meeting to which it relates.
82. A vote given in accordance with the terms of an instrument of proxy shall be valid
notwithstanding the previous death or insanity of the principal, or revocation of the instrument of
proxy or of the authority under which it was executed, provided that no intimation in writing of
such death, insanity or revocation shall have been received by the Company at the Office or the
Registration Office (or such other place as may be specified for the delivery of instruments of
proxy in the notice convening the meeting or other document sent therewith) two hours at least
before the commencement of the meeting or adjourned meeting, or the taking of the poll, at which
the instrument of proxy is used.
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83. Anything which under these Articles a Member may do by proxy he may likewise do by his duly
appointed attorney and the provisions of these Articles relating to proxies and instruments
appointing proxies shall apply mutatis mutandis in relation to any such attorney and the instrument
under which such attorney is appointed.
CORPORATIONS ACTING BY REPRESENTATIVES
84. (1) Any corporation which is a Member may by resolution of its directors or other
governing body authorise such person as it thinks fit to act as its representative at any meeting
of the Company or at any meeting of any class of Members. The person so authorised shall be
entitled to exercise the same powers on behalf of such corporation as the corporation could
exercise if it were an individual Member and such corporation shall for the purposes of these
Articles be deemed to be present in person at any such meeting if a person so authorised is present
thereat.
(2) If a clearing house (or its nominee(s)) or a central depository entity, being a
corporation, is a Member, it may authorise such persons as it thinks fit to act as its
representatives at any meeting of the Company or at any meeting of any class of Members provided
that the authorisation shall specify the number and class of shares in respect of which each such
representative is so authorised. Each person so authorised under the provisions of this Article
shall be deemed to have been duly authorised without further evidence of the facts and be entitled
to exercise the same rights and powers on behalf of the clearing house or central depository entity
(or its nominee(s)) as if such person was the registered holder of the shares of the Company held
by the clearing house or a central depository entity (or its nominee(s)) including the right to
vote individually on a show of hands.
(3) Any reference in these Articles to a duly authorised representative of a Member being a
corporation shall mean a representative authorised under the provisions of this Article.
NO ACTION BY WRITTEN RESOLUTIONS OF MEMBERS
85. Any action required or permitted to be taken at any annual or extraordinary general meetings of
the Company may be taken only upon the vote of the Members at an annual or extraordinary general
meeting duly noticed and convened in accordance with these Articles and the Law and may not be
taken by written resolution of Members without a meeting.
BOARD OF DIRECTORS
86. (1) Unless otherwise determined by the Company in general meeting, the number of Directors
shall not be less than two (2). There shall be no maximum number of Directors unless otherwise
determined from time to time by the Members in general meeting. The Directors shall be elected or
appointed in the first place by the subscribers to the
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Memorandum of Association or by a majority of them and thereafter in accordance with these Articles
and shall hold office until their successors are elected or appointed.
(2) Subject to the Articles and the Law, the Company may by ordinary resolution elect any
person to be a Director either to fill a casual vacancy or as an addition to the existing Board.
(3) The Directors shall have the power from time to time and at any time to appoint any
person as a Director to fill a casual vacancy on the Board or as an addition to the existing Board.
Any Director so appointed by the Board shall hold office only until the next following annual
general meeting of the Company and shall then be eligible for re-election.
(4) No Director shall be required to hold any shares of the Company by way of qualification
and a Director who is not a Member shall be entitled to receive notice of and to attend and speak
at any general meeting of the Company and of all classes of shares of the Company.
(5) Subject to any provision to the contrary in these Articles, a Director may be removed by
way of an ordinary resolution of the Members at any time before the expiration of his period of
office notwithstanding anything in these Articles or in any agreement between the Company and such
Director (but without prejudice to any claim for damages under any such agreement).
(6) A vacancy on the Board created by the removal of a Director under the provisions of
subparagraph (5) above may be filled by the election or appointment by ordinary resolution of the
Members at the meeting at which such Director is removed or by the affirmative vote of a simple
majority of the remaining Directors present and voting at a Board meeting.
(7) The Company may from time to time in general meeting by ordinary resolution increase or
reduce the number of Directors but so that the number of Directors shall never be less than two
(2).
DISQUALIFICATION OF DIRECTORS
87. The office of a Director shall be vacated if the Director:
(1) resigns his office by notice in writing delivered to the Company at the Office or tendered
at a meeting of the Board;
(2) |
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becomes of unsound mind or dies; |
(3) without special leave of absence from the Board, is absent from meetings of the Board for
six consecutive months and the Board resolves that his office be vacated; or
(4) becomes bankrupt or has a receiving order made against him or suspends
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payment or compounds with his creditors;
(5) is prohibited by law from being a Director; or
(6) ceases to be a Director by virtue of any provision of the Statutes or is removed from
office pursuant to these Articles.
EXECUTIVE DIRECTORS
88. The Board may from time to time appoint any one or more of its body to be the Chairman of the
Board, a managing director, joint managing director or deputy managing director or to hold any
other employment or executive office with the Company for such period (subject to their continuance
as Directors) and upon such terms as the Board may determine and the Board may revoke or terminate
any of such appointments. Any such revocation or termination as aforesaid shall be without
prejudice to any claim for damages that such Director may have against the Company or the Company
may have against such Director. A Director appointed to an office under this Article shall be
subject to the same provisions as to removal as the other Directors of the Company, and he shall
(subject to the provisions of any contract between him and the Company) ipso facto and immediately
cease to hold such office if he shall cease to hold the office of Director for any cause.
89. Notwithstanding Articles 94, 95 and 96, an executive director appointed to an office
under Article 88 hereof shall receive such remuneration (whether by way of salary, commission,
participation in profits or otherwise or by all or any of those modes) and such other benefits
(including pension and/or gratuity and/or other benefits on retirement) and allowances as the Board
may from time to time determine, and either in addition to or in lieu of his remuneration as a
Director.
ALTERNATE DIRECTORS
90. Any Director may at any time by Notice delivered to the Office or head office or at a meeting
of the Directors appoint any person (including another Director) to be his alternate Director. Any
person so appointed shall have all the rights and powers of the Director or Directors for whom such
person is appointed in the alternative provided that such person shall not be counted more than
once in determining whether or not a quorum is present. An alternate Director may be removed at
any time by the body which appointed him and, subject thereto, the office of alternate Director
shall continue until the happening of any event which, if we were a Director, would cause him to
vacate such office or if his appointer ceases for any reason to be a Director. Any appointment or
removal of an alternate Director shall be effected by Notice signed by the appointor and delivered
to the Office or head office or tendered at a meeting of the Board. An alternate Director may also
be a Director in his own right and may act as alternate to more than one Director. An alternate
Director shall, if his appointor so requests, be entitled to receive notices of meetings of the
Board or of committees of the Board to the same extent as, but in lieu of, the Director appointing
him and shall be entitled to such extent to attend and vote as a Director at any such meeting at
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which the Director appointing him is not personally present and generally at such meeting to
exercise and discharge all the functions, powers and duties of his appointor as a Director and for
the purposes of the proceedings at such meeting the provisions of these Articles shall apply as if
he were a Director save that as an alternate for more than one Director his voting rights shall be
cumulative.
91. An alternate Director shall only be a Director for the purposes of the Law and shall only be
subject to the provisions of the Law insofar as they relate to the duties and obligations of a
Director when performing the functions of the Director for whom he is appointed in the alternative
and shall alone be responsible to the Company for his acts and defaults and shall not be deemed to
be the agent of or for the Director appointing him. An alternate Director shall be entitled to
contract and be interested in and benefit from contracts or arrangements or transactions and to be
repaid expenses and to be indemnified by the Company to the same extent mutatis mutandis as if he
were a Director but he shall not be entitled to receive from the Company any fee in his capacity as
an alternate Director except only such part, if any, of the remuneration otherwise payable to his
appointor as such appointor may by Notice to the Company from time to time direct.
92. Every person acting as an alternate Director shall have one vote for each Director for whom he
acts as alternate (in addition to his own vote if he is also a Director). If his appointor is for
the time being absent from the Peoples Republic of China or otherwise not available or unable to
act, the signature of an alternate Director to any resolution in writing of the Board or a
committee of the Board of which his appointor is a member shall, unless the notice of his
appointment provides to the contrary, be as effective as the signature of his appointor.
93. An alternate Director shall ipso facto cease to be an alternate Director if his appointor
ceases for any reason to be a Director, however, such alternate Director or any other person may be
re-appointed by the Directors to serve as an alternate Director PROVIDED always that, if at any
meeting any Director retires but is re-elected at the same meeting, any appointment of such
alternate Director pursuant to these Articles which was in force immediately before his retirement
shall remain in force as though he had not retired.
DIRECTORS FEES AND EXPENSES
94. The Directors shall receive such remuneration as the Board may from time to time determine.
Such remuneration shall be deemed to accrue from day to day.
95. Each Director shall be entitled to be repaid or prepaid all travelling, hotel and incidental
expenses reasonably incurred or expected to be incurred by him in attending meetings of the Board
or committees of the Board or general meetings or separate meetings of any class of shares or of
debentures of the Company or otherwise in connection with the discharge of his duties as a
Director.
96. Any Director who, by request, goes or resides abroad for any purpose of the Company or who
performs services which in the opinion of the Board go beyond the
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ordinary duties of a Director may be paid such extra remuneration (whether by way of salary,
commission, participation in profits or otherwise) as the Board may determine and such extra
remuneration shall be in addition to or in substitution for any ordinary remuneration provided for
by or pursuant to any other Article.
DIRECTORS INTERESTS
97. A Director may:
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(a) |
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hold any other office or place of profit with the Company (except that of
Auditor) in conjunction with his office of Director for such period and upon such terms
as the Board may determine. Any remuneration (whether by way of salary, commission,
participation in profits or otherwise) paid to any Director in respect of any such
other office or place of profit shall be in addition to any remuneration provided for
by or pursuant to any other Article; |
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(b) |
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act by himself or his firm in a professional capacity for the Company
(otherwise than as Auditor) and he or his firm may be remunerated for professional
services as if he were not a Director; |
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(c) |
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continue to be or become a director, managing director, joint managing
director, deputy managing director, executive director, manager or other officer or
member of any other company promoted by the Company or in which the Company may be
interested as a vendor, shareholder or otherwise and (unless otherwise agreed) no such
Director shall be accountable for any remuneration, profits or other benefits received
by him as a director, managing director, joint managing director, deputy managing
director, executive director, manager or other officer or member of or from his
interests in any such other company. Subject as otherwise provided by these Articles
the Directors may exercise or cause to be exercised the voting powers
conferred by the shares in any other company held or owned by the Company, or exercisable by them as
Directors of such other company in such manner in
all respects as they think fit (including the exercise thereof in favour of any
resolution appointing themselves or any of them directors, managing directors, joint
managing directors, deputy managing directors, executive directors, managers or
other officers of such company) or voting or providing for the payment of
remuneration to the director, managing director, joint managing director, deputy
managing director, executive director, manager or other officers of such other
company and any Director may vote in favour of the exercise of such voting rights in
manner aforesaid notwithstanding that he may be, or about to be, appointed a
director, managing director, joint managing director, deputy managing director,
executive director, manager or other officer of such a company, and that as such he
is or may become interested in the exercise of such voting rights in manner
aforesaid. |
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Notwithstanding the foregoing, no Independent Director as defined in NASD Rules or in
Rule 10A-3 under the Exchange Act, and with respect of whom the Board has determined constitutes an
Independent Director for purposes of compliance with applicable law or the Companys listing
requirements, shall without the consent of the Audit Committee take any of the foregoing actions or
any other action that would reasonably be likely to affect such Directors status as an
Independent Director of the Company.
98. Subject to the Law and to these Articles, no Director or proposed or intending Director shall
be disqualified by his office from contracting with the Company, either with regard to his tenure
of any office or place of profit or as vendor, purchaser or in any other manner whatever, nor shall
any such contract or any other contract or arrangement in which any Director is in any way
interested be liable to be avoided, nor shall any Director so contracting or being so interested be
liable to account to the Company or the Members for any remuneration, profit or other benefits
realised by any such contract or arrangement by reason of such Director holding that office or of
the fiduciary relationship thereby established provided that such Director shall disclose the
nature of his interest in any contract or arrangement in which he is interested in accordance with
Article 99 herein. Any such transaction that would reasonably be likely to affect a Directors
status as an Independent Director, or that would constitute a related party transaction as
defined by Item 7.N of Form 20F promulgated by the SEC, shall require the approval of the Audit
Committee.
99. A Director who to his knowledge is in any way, whether directly or indirectly, interested in a
contract or arrangement or proposed contract or arrangement with the Company shall declare the
nature of his interest at the meeting of the Board at which the question of entering into the
contract or arrangement is first considered, if he knows his interest then exists, or in any other
case at the first meeting of the Board after he knows that he is or has become so interested. For
the purposes of this Article, a general Notice to the Board by a Director to the effect that:
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(a) |
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he is a member or officer of a specified company or firm and is to be regarded
as interested in any contract or arrangement which may after the date of the Notice be
made with that company or firm; or |
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(b) |
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he is to be regarded as interested in any contract or arrangement which may
after the date of the Notice be made with a specified person who is connected with him; |
shall be deemed to be a sufficient declaration of interest under this Article in relation to
any such contract or arrangement, provided that no such Notice shall be effective unless either it
is given at a meeting of the Board or the Director takes reasonable steps to secure that it is
brought up and read at the next Board meeting after it is given.
100. Following a declaration being made pursuant to the last preceding two Articles, subject to any
separate requirement for Audit Committee approval under applicable law or the listing rules of the
Companys Designated Stock Exchange, and unless disqualified by
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the chairman of the relevant Board meeting, a Director may vote in respect of any contract or
proposed contract or arrangement in which such Director is interested and may be counted in the
quorum at such meeting.
GENERAL POWERS OF THE DIRECTORS
101. (1) The business of the Company shall be managed and conducted by the Board, which may pay all
expenses incurred in forming and registering the Company and may exercise all powers of the Company
(whether relating to the management of the business of the Company or otherwise) which are not by
the Statutes or by these Articles required to be exercised by the Company in general meeting,
subject nevertheless to the provisions of the Statutes and of these Articles and to such
regulations being not inconsistent with such provisions, as may be prescribed by the Company in
general meeting, but no regulations made by the Company in general meeting shall invalidate any
prior act of the Board which would have been valid if such regulations had not been made. The
general powers given by this Article shall not be limited or restricted by any special authority or
power given to the Board by any other Article.
(2) Any person contracting or dealing with the Company in the ordinary course of business
shall be entitled to rely on any written or oral contract or agreement or deed, document or
instrument entered into or executed as the case may be by any two of the Directors acting jointly
on behalf of the Company and the same shall be deemed to be validly entered into or executed by the
Company as the case may be and shall, subject to any rule of law, be binding on the Company.
(3) Without prejudice to the general powers conferred by these Articles it is hereby expressly
declared that the Board shall have the following powers:
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(a) |
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To give to any person the right or option of requiring at a future date that an
allotment shall be made to him of any share at par or at such premium as may be agreed. |
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(b) |
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To give to any Directors, officers or employees of the Company an interest in
any particular business or transaction or participation in the profits thereof or in
the general profits of the Company either in addition to or in substitution for a
salary or other remuneration. |
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(c) |
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To resolve that the Company be deregistered in the Cayman Islands and continued
in a named jurisdiction outside the Cayman Islands subject to the provisions of the
Law. |
102. The Board may establish any regional or local boards or agencies for managing any of the
affairs of the Company in any place, and may appoint any persons to be members of such local
boards, or any managers or agents, and may fix their remuneration (either by way of salary or by
commission or by conferring the right to participation in the profits of the Company or by a
combination of two or more of these modes) and pay the working
- 33 -
expenses of any staff employed by them upon the business of the Company. The Board may delegate to
any regional or local board, manager or agent any of the powers, authorities and discretions vested
in or exercisable by the Board (other than its powers to make calls and forfeit shares), with power
to sub-delegate, and may authorise the members of any of them to fill any vacancies therein and to
act notwithstanding vacancies. Any such appointment or delegation may be made upon such terms and
subject to such conditions as the Board may think fit, and the Board may remove any person
appointed as aforesaid, and may revoke or vary such delegation, but no person dealing in good faith
and without notice of any such revocation or variation shall be affected thereby.
103. The Board may by power of attorney appoint any company, firm or person or any fluctuating body
of persons, whether nominated directly or indirectly by the Board, to be the attorney or attorneys
of the Company for such purposes and with such powers, authorities and discretions (not exceeding
those vested in or exercisable by the Board under these Articles) and for such period and subject
to such conditions as it may think fit, and any such power of attorney may contain such provisions
for the protection and convenience of persons dealing with any such attorney as the Board may think
fit, and may also authorise any such attorney to sub-delegate all or any of the powers, authorities
and discretions vested in him. Such attorney or attorneys may, if so authorised under the Seal of
the Company, execute any deed or instrument under their personal seal with the same effect as the
affixation of the Companys Seal.
104. The Board may entrust to and confer upon a managing director, joint managing director, deputy
managing director, an executive director or any Director any of the powers exercisable by it upon
such terms and conditions and with such restrictions as it thinks fit, and either collaterally
with, or to the exclusion of, its own powers, and may from time to time revoke or vary all or any
of such powers but no person dealing in good faith and without notice of such revocation or
variation shall be affected thereby.
105. All cheques, promissory notes, drafts, bills of exchange and other instruments, whether
negotiable or transferable or not, and all receipts for moneys paid to the Company shall be signed,
drawn, accepted, endorsed or otherwise executed, as the case may be, in such manner as the Board
shall from time to time by resolution determine. The Companys banking accounts shall be kept with
such banker or bankers as the Board shall from time to time determine.
106. (1) The Board may establish or concur or join with other companies (being subsidiary companies
of the Company or companies with which it is associated in business) in establishing and making
contributions out of the Companys moneys to any schemes or funds for providing pensions, sickness
or compassionate allowances, life assurance or other benefits for employees (which expression as
used in this and the following paragraph shall include any Director or ex-Director who may hold or
have held any executive office or any office of profit under the Company or any of its subsidiary
companies) and ex-employees of the Company and their dependants or any class or classes of such
person.
(2) The Board may pay, enter into agreements to pay or make grants of revocable or irrevocable
pensions or other benefits to employees and ex-employees and their
- 34 -
dependants, or to any of such persons, including pensions or benefits additional to those, if
any, to which such employees or ex-employees or their dependants are or may become entitled under
any such scheme or fund as mentioned in the last preceding paragraph. Any such pension or benefit
may, as the Board considers desirable, be granted to an employee either before and in anticipation
of or upon or at any time after his actual retirement, and may be subject or not subject to any
terms or conditions as the Board may determine.
BORROWING POWERS
107. The Board may exercise all the powers of the Company to raise or borrow money and to mortgage
or charge all or any part of the undertaking, property and assets (present and future) and uncalled
capital of the Company and, subject to the Law, to issue debentures, bonds and other securities,
whether outright or as collateral security for any debt, liability or obligation of the Company or
of any third party.
108. Debentures, bonds and other securities may be made assignable free from any equities between
the Company and the person to whom the same may be issued.
109. Any debentures, bonds or other securities may be issued at a discount (other than shares),
premium or otherwise and with any special privileges as to redemption, surrender, drawings,
allotment of shares, attending and voting at general meetings of the Company, appointment of
Directors and otherwise.
110. (1) Where any uncalled capital of the Company is charged, all persons taking any subsequent
charge thereon shall take the same subject to such prior charge, and shall not be entitled, by
notice to the Members or otherwise, to obtain priority over such prior charge.
(2) The Board shall cause a proper register to be kept, in accordance with the
provisions of the Law, of all charges specifically affecting the property of the Company and of any
series of debentures issued by the Company and shall duly comply with the requirements of the Law
in regard to the registration of charges and debentures therein specified and otherwise.
PROCEEDINGS OF THE DIRECTORS
111. The Board may meet for the despatch of business, adjourn and otherwise regulate its meetings
as it considers appropriate. Questions arising at any meeting shall be determined by a majority of
votes. In the case of any equality of votes the chairman of the meeting shall have an additional
or casting vote.
112. A meeting of the Board may be convened by the Secretary on request of a Director or by any
Director. The Secretary shall convene a meeting of the Board of which notice may be given in
writing or by telephone or in such other manner as the Board may from time to time determine
whenever he shall be required so to do by the president or chairman,
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as the case may be, or any Director.
113. (1) The quorum necessary for the transaction of the business of the Board may be fixed by the
Board and, unless so fixed at any other number, shall be two (2) of the Directors. An alternate
Director shall be counted in a quorum in the case of the absence of a Director for whom he is the
alternate provided that he shall not be counted more than once for the purpose of determining
whether or not a quorum is present.
(2) Directors may participate in any meeting of the Board by means of a conference telephone
or other communications equipment through which all persons participating in the meeting can
communicate with each other simultaneously and instantaneously and, for the purpose of counting a
quorum, such participation shall constitute presence at a meeting as if those participating were
present in person.
(3) Any Director who ceases to be a Director at a Board meeting may continue to be present and
to act as a Director and be counted in the quorum until the termination of such Board meeting if no
other Director objects and if otherwise a quorum of Directors would not be present.
114. The continuing Directors or a sole continuing Director may act notwithstanding any vacancy in
the Board but, if and so long as the number of Directors is reduced below the minimum number fixed
by or in accordance with these Articles, the continuing Directors or Director, notwithstanding that
the number of Directors is below the number fixed by or in accordance with these Articles as the
quorum or that there is only one continuing Director, may act for the purpose of filling vacancies
in the Board or of summoning general meetings of the Company but not for any other purpose.
115. The Chairman of the Board shall be the chairman of all meetings of the Board. If the
Chairman of the Board is not present at any meeting within five (5) minutes after the time
appointed for holding the same, the Directors present may choose one of their number to be chairman
of the meeting.
116. A meeting of the Board at which a quorum is present shall be competent to exercise all the
powers, authorities and discretions for the time being vested in or exercisable by the Board.
117. (1) The Board may delegate any of its powers, authorities and discretions to committees
(including, without limitation, the Audit Committee), consisting of such Director or Directors and
other persons as it thinks fit, and they may, from time to time, revoke such delegation or revoke
the appointment of and discharge any such committees either wholly or in part, and either as to
persons or purposes. Any committee so formed shall, in the exercise of the powers, authorities and
discretions so delegated, conform to any regulations which may be imposed on it by the Board.
(2) All acts done by any such committee in conformity with such regulations, and in fulfilment
of the purposes for which it was appointed, but not otherwise, shall have like force and effect as
if done by the Board, and the Board (or if the Board delegates such power,
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the committee) shall have power to remunerate the members of any such committee, and charge
such remuneration to the current expenses of the Company.
118. The meetings and proceedings of any committee consisting of two or more members shall be
governed by the provisions contained in these Articles for regulating the meetings and proceedings
of the Board so far as the same are applicable and are not superseded by any regulations imposed by
the Board under the last preceding Article, indicating, without limitation, any committee charter
adopted by the Board for purposes or in respect of any such committee.
119. A resolution in writing signed by all the Directors except such as are temporarily unable to
act through ill-health or disability shall (provided that such number is sufficient to constitute a
quorum and further provided that a copy of such resolution has been given or the contents thereof
communicated to all the Directors for the time being entitled to receive notices of Board meetings
in the same manner as notices of meetings are required to be given by these Articles) be as valid
and effectual as if a resolution had been passed at a meeting of the Board duly convened and held.
Such resolution may be contained in one document or in several documents in like form each signed
by one or more of the Directors and for this purpose a facsimile signature of a Director shall be
treated as valid.
120. All acts bona fide done by the Board or by any committee or by any person acting as a
Director or members of a committee, shall, notwithstanding that it is afterwards discovered that
there was some defect in the appointment of any member of the Board or such committee or person
acting as aforesaid or that they or any of them were disqualified or had vacated office, be as
valid as if every such person had been duly appointed and was qualified and had continued to be a
Director or member of such committee.
AUDIT COMMITTEE
121. Without prejudice to the freedom of the Directors to establish any other committees, for so
long as the shares of the Company (or depositary receipts therefor) are listed or quoted on the
Designated Stock Exchange, the Board shall establish and maintain an Audit Committee as a committee
of the Board, the composition and responsibilities of which shall comply with the NASD Rules and
the rules and regulations of the SEC.
122. (1) The Board shall adopt a formal written audit committee charter and review and assess the
adequacy of the formal written charter on an annual basis.
(2) The Audit Committee shall meet at least once every financial quarter, or more frequently
as circumstances dictate.
123. For so long as the shares of the Company (or depositary receipts therefor) are listed or
quoted on the Designated Stock Exchange, the Company shall conduct an appropriate review of all
related party transactions on an ongoing basis and shall utilize the Audit Committee for the review
and approval of potential conflicts of interest. Specially, the Audit Committee shall approve any
transaction or transactions between the Company and
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any of the following parties: (i) any member owning an interest in the voting power of the Company
or any subsidiary of the Company that gives such member significant influence over the Company or
any subsidiary of the Company, (ii) any director or executive officer of the Company or any
subsidiary of the Company and any relative of such director or executive officer, (iii) any person
in which a substantial interest in the voting power of the Company is owned, directly or
indirectly, by any person described in (i) or (ii) or over which such a person is able to exercise
significant influence, and (iv) any affiliate (other than a subsidiary) of the Company.
OFFICERS
124. (1) The officers of the Company shall consist of the Chairman of the Board, the Directors and
Secretary and such additional officers (who may or may not be Directors) as the Board may from time
to time determine, all of whom shall be deemed to be officers for the purposes of the Law and these
Articles.
(2) The Directors shall, as soon as may be after each appointment or election of Directors,
elect amongst the Directors a chairman and if more than one Director is proposed for this office,
the election to such office shall take place in such manner as the Directors may determine.
(3) The officers shall receive such remuneration as the Directors may from time to time
determine.
125. (1) The Secretary and additional officers, if any, shall be appointed by the Board and shall
hold office on such terms and for such period as the Board may determine. If thought fit, two or
more persons may be appointed as joint Secretaries. The Board may also appoint from time to time
on such terms as it thinks fit one or more assistant or deputy Secretaries.
(2) The Secretary shall attend all meetings of the Members and shall keep correct minutes of
such meetings and enter the same in the proper books provided for the purpose. He shall perform
such other duties as are prescribed by the Law or these Articles or as may be prescribed by the
Board.
126. The officers of the Company shall have such powers and perform such duties in the
management, business and affairs of the Company as may be delegated to them by the Directors from
time to time.
127. A provision of the Law or of these Articles requiring or authorising a thing to be done by or
to a Director and the Secretary shall not be satisfied by its being done by or to the same person
acting both as Director and as or in place of the Secretary.
REGISTER OF DIRECTORS AND OFFICERS
128. The Company shall cause to be kept in one or more books at its Office a Register of
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Directors and Officers in which there shall be entered the full names and addresses of the
Directors and Officers and such other particulars as required by the Law or as the Directors may
determine. The Company shall send to the Registrar of Companies in the Cayman Islands a copy of
such register, and shall from time to time notify to the said Registrar of any change that takes
place in relation to such Directors and Officers as required by the Law.
MINUTES
129. (1) The Board shall cause minutes to be duly entered in books provided for the purpose:
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(a) |
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of all elections and appointments of officers; |
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(b) |
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of the names of the Directors present at each meeting of the Directors and of
any committee of the Directors; |
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(c) |
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of all resolutions and proceedings of each general meeting of the Members,
meetings of the Board and meetings of committees of the Board and where there are
managers, of all proceedings of meetings of the managers. |
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(2) |
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Minutes shall be kept by the Secretary at the Office. |
SEAL
130. (1) The Company shall have one or more Seals, as the Board may determine. For the
purpose of sealing documents creating or evidencing securities issued by the Company, the Company
may have a securities seal which is a facsimile of the Seal of the Company with the addition of the
word Securities on its face or in such other form as the Board may approve. The Board shall
provide for the custody of each Seal and no Seal shall be used without the authority of the Board
or of a committee of the Board authorised by the Board in that behalf. Subject as otherwise
provided in these Articles, any instrument to which a Seal is affixed shall be signed
autographically by one Director and the Secretary or by two Directors or by such other person
(including a Director) or persons as the Board may appoint, either generally or in any particular
case, save that as regards any certificates for shares or debentures or other securities of the
Company the Board may by resolution determine that such signatures or either of them shall be
dispensed with or affixed by some method or system of mechanical signature. Every instrument
executed in manner provided by this Article shall be deemed to be sealed and executed with the
authority of the Board previously given.
(2) Where the Company has a Seal for use abroad, the Board may by writing under the Seal
appoint any agent or committee abroad to be the duly authorised agent of the Company for the
purpose of affixing and using such Seal and the Board may impose restrictions on the use thereof as
may be thought fit. Wherever in these Articles reference is made to the Seal, the reference shall,
when and so far as may be applicable, be deemed to
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include any such other Seal as aforesaid.
AUTHENTICATION OF DOCUMENTS
131. Any Director or the Secretary or any person appointed by the Board for the purpose may
authenticate any documents affecting the constitution of the Company and any resolution passed by
the Company or the Board or any committee, and any books, records, documents and accounts relating
to the business of the Company, and to certify copies thereof or extracts therefrom as true copies
or extracts, and if any books, records, documents or accounts are elsewhere than at the Office or
the head office the local manager or other officer of the Company having the custody thereof shall
be deemed to be a person so appointed by the Board. A document purporting to be a copy of a
resolution, or an extract from the minutes of a meeting, of the Company or of the Board or any
committee which is so certified shall be conclusive evidence in favour of all persons dealing with
the Company upon the faith thereof that such resolution has been duly passed or, as the case may
be, that such minutes or extract is a true and accurate record of proceedings at a duly constituted
meeting.
DESTRUCTION OF DOCUMENTS
132. (1) The Company shall be entitled to destroy the following documents at the following times:
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(a) |
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any share certificate which has been cancelled at any time after the expiry of
one (1) year from the date of such cancellation; |
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(b) |
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any dividend mandate or any variation or cancellation thereof or any
notification of change of name or address at any time after the expiry of two (2)
years from the date such mandate variation cancellation or notification was recorded by
the Company; |
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(c) |
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any instrument of transfer of shares which has been registered at any time
after the expiry of seven (7) years from the date of registration; |
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(d) |
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any allotment letters after the expiry of seven (7) years from the date of issue
thereof; and |
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(e) |
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copies of powers of attorney, grants of probate and letters of administration
at any time after the expiry of seven (7) years after the account to which the relevant
power of attorney, grant of probate or letters of administration related has been
closed; |
and it shall conclusively be presumed in favour of the Company that every entry in the
Register purporting to be made on the basis of any such documents so destroyed was duly and
properly made and every share certificate so destroyed was a valid
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certificate duly and properly cancelled and that every instrument of transfer so destroyed was
a valid and effective instrument duly and properly registered and that every other document
destroyed hereunder was a valid and effective document in accordance with the recorded particulars
thereof in the books or records of the Company. Provided always that: (1) the foregoing provisions
of this Article shall apply only to the destruction of a document in good faith and without express
notice to the Company that the preservation of such document was relevant to a claim; (2) nothing
contained in this Article shall be construed as imposing upon the Company any liability in respect
of the destruction of any such document earlier than as aforesaid or in any case where the
conditions of proviso (1) above are not fulfilled; and (3) references in this Article to the
destruction of any document include references to its disposal in any manner.
(2) Notwithstanding any provision contained in these Articles, the Directors may, if permitted
by applicable law, authorise the destruction of documents set out in sub-paragraphs (a) to (e) of
paragraph (1) of this Article and any other documents in relation to share registration which have
been microfilmed or electronically stored by the Company or by the share registrar on its behalf
provided always that this Article shall apply only to the destruction of a document in good faith
and without express notice to the Company and its share registrar that the preservation of such
document was relevant to a claim.
DIVIDENDS AND OTHER PAYMENTS
133. Subject to the Law, the Company in general meeting or the Board may from time to time declare
dividends in any currency to be paid to the Members but no dividend shall be declared in excess of
the amount recommended by the Board.
134. Dividends may be declared and paid out of the profits of the Company, realised or unrealised,
or from any reserve set aside from profits which the Directors determine is no longer needed. The
Board may also declare and pay dividends out of share premium account or any other fund or account
which can be authorised for this purpose in accordance with the Law.
135. Except in so far as the rights attaching to, or the terms of issue of, any share otherwise
provide:
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(a) |
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all dividends shall be declared and paid according to the amounts paid up on the
shares in respect of which the dividend is paid, but no amount paid up on a share in
advance of calls shall be treated for the purposes of this Article as paid up on the
share; and |
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(b) |
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all dividends shall be apportioned and paid pro rata according to the amounts
paid up on the shares during any portion or portions of the period in respect of which
the dividend is paid. |
136. The Board may from time to time pay to the Members such interim dividends as appear to the
Board to be justified by the profits of the Company and in particular (but
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without prejudice to the generality of the foregoing) if at any time the share capital of the
Company is divided into different classes, the Board may pay such interim dividends in respect of
those shares in the capital of the Company which confer on the holders thereof deferred or
non-preferential rights as well as in respect of those shares which confer on the holders thereof
preferential rights with regard to dividend and provided that the Board may also pay any fixed
dividend which is payable on any shares of the Company half-yearly or on any other dates, whenever
such profits, in the opinion of the Board, justifies such payment.
137. The Board may deduct from any dividend or other moneys payable to a Member by the Company on
or in respect of any shares all sums of money (if any) presently payable by him to the Company on
account of calls or otherwise.
138. No dividend or other moneys payable by the Company on or in respect of any share shall bear
interest against the Company.
139. Any dividend, interest or other sum payable in cash to the holder of shares may be paid by
cheque or warrant sent through the post addressed to the holder at his registered address or, in
the case of joint holders, addressed to the holder whose name stands first in the Register in
respect of the shares at his address as appearing in the Register or addressed to such person and
at such address as the holder or joint holders may in writing direct. Every such cheque or warrant
shall, unless the holder or joint holders otherwise direct, be made payable to the order of the
holder or, in the case of joint holders, to the order of the holder whose name stands first on the
Register in respect of such shares, and shall be sent at his or their risk and payment of the
cheque or warrant by the bank on which it is drawn shall constitute a good discharge to the Company
notwithstanding that it may subsequently appear that the same has been stolen or that any
endorsement thereon has been forged. Any one of two or more joint holders may give effectual
receipts for any dividends or other moneys payable or property distributable in respect of the
shares held by such joint holders.
140. All dividends or bonuses unclaimed for one (1) year after having been declared may be invested
or otherwise made use of by the Board for the benefit of the Company until claimed. Any dividend
or bonuses unclaimed after a period of six (6) years from the date of declaration shall be
forfeited and shall revert to the Company. The payment by the Board of any unclaimed dividend or
other sums payable on or in respect of a share into a separate account shall not constitute the
Company a trustee in respect thereof.
141. Whenever the Board or the Company in general meeting has resolved that a dividend be paid or
declared, the Board may further resolve that such dividend be satisfied wholly or in part by the
distribution of specific assets of any kind and in particular of paid up shares, debentures or
warrants to subscribe securities of the Company or any other company, or in any one or more of such
ways, and where any difficulty arises in regard to the distribution the Board may settle the same
as it thinks expedient, and in particular may issue certificates in respect of fractions of shares,
disregard fractional entitlements or round the same up or down, and may fix the value for
distribution of such specific assets, or any part thereof, and may determine that cash payments
shall be made to any Members upon the footing of the value so fixed in order to adjust the rights
of all parties, and may vest any
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such specific assets in trustees as may seem expedient to the Board and may appoint any person to
sign any requisite instruments of transfer and other documents on behalf of the persons entitled to
the dividend, and such appointment shall be effective and binding on the Members. The Board may
resolve that no such assets shall be made available to Members with registered addresses in any
particular territory or territories where, in the absence of a registration statement or other
special formalities, such distribution of assets would or might, in the opinion of the Board, be
unlawful or impracticable and in such event the only entitlement of the Members aforesaid shall be
to receive cash payments as aforesaid. Members affected as a result of the foregoing sentence
shall not be or be deemed to be a separate class of Members for any purpose whatsoever.
142. (1) Whenever the Board or the Company in general meeting has resolved that a dividend be paid
or declared on any class of the share capital of the Company, the Board may further resolve either:
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(a) |
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that such dividend be satisfied wholly or in part in the form of an allotment
of shares credited as fully paid up, provided that the Members entitled thereto will be
entitled to elect to receive such dividend (or part thereof if the Board so determines)
in cash in lieu of such allotment. In such case, the following provisions shall apply: |
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(i) |
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the basis of any such allotment shall be determined by the
Board; |
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(ii) |
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the Board, after determining the basis of allotment, shall give
not less than ten (10) days Notice to the holders of the relevant shares of
the right of election accorded to them and shall send with such notice forms of
election and specify the procedure to be followed and the place at which and
the latest date and time by which duly completed forms of election must be
lodged in order to be effective; |
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(iii) |
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the right of election may be exercised in respect of the whole
or part of that portion of the dividend in respect of which the right of
election has been accorded; and |
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(iv) |
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the dividend (or that part of the dividend to be satisfied by
the allotment of shares as aforesaid) shall not be payable in cash on shares in
respect whereof the cash election has not been duly exercised (the non-elected
shares) and in satisfaction thereof shares of the relevant class shall be
allotted credited as fully paid up to the holders of the non-elected shares on
the basis of allotment determined as aforesaid and for such purpose the Board
shall capitalise and apply out of any part of the undivided profits of the
Company (including profits carried and standing to the credit of any reserves
or other special account, share premium account, capital redemption reserve
other than the Subscription Rights Reserve) as the Board may determine, such
sum as may be required to pay up in full the appropriate number of shares of
the relevant class for allotment and distribution to and |
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amongst the holders of the non-elected shares on such basis; or |
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(b) |
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that the Members entitled to such dividend shall be entitled to elect to
receive an allotment of shares credited as fully paid up in lieu of the whole or such
part of the dividend as the Board may think fit. In such case, the following
provisions shall apply: |
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(i) |
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the basis of any such allotment shall be determined by the
Board; |
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(ii) |
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the Board, after determining the basis of allotment, shall give
not less than ten (10) days Notice to the holders of the relevant shares of
the right of election accorded to them and shall send with such notice forms of
election and specify the procedure to be followed and the place at which and
the latest date and time by which duly completed forms of election must be
lodged in order to be effective; |
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(iii) |
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the right of election may be exercised in respect of the whole
or part of that portion of the dividend in respect of which the right of
election has been accorded; and |
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(iv) |
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the dividend (or that part of the dividend in respect of which
a right of election has been accorded) shall not be payable in cash on shares
in respect whereof the share election has been duly exercised (the elected
shares) and in lieu thereof shares of the relevant class shall be allotted
credited as fully paid up to the holders of the elected shares on the basis of
allotment determined as aforesaid and for such purpose the Board shall
capitalise and apply out of any part of the undivided profits of the Company
(including profits carried and standing to the credit of any reserves or other
special account, share premium account, capital redemption reserve other than
the Subscription Rights Reserve) as the Board may determine, such sum as may be
required to pay up in full the appropriate number of shares of the relevant
class for allotment and distribution to and amongst the holders of the elected
shares on such basis. |
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(2) |
(a) |
The shares allotted pursuant to the provisions of paragraph (1) of this
Article shall rank pari passu in all respects with shares of the same class (if any)
then in issue save only as regards participation in the relevant dividend or in any
other distributions, bonuses or rights paid, made, declared or announced prior to or
contemporaneously with the payment or declaration of the relevant dividend unless,
contemporaneously with the announcement by the Board of their proposal to apply the
provisions of sub-paragraph (a) or (b) of paragraph (2) of this Article in relation to
the relevant dividend or contemporaneously with their announcement of the distribution,
bonus or rights in question, the Board shall specify that the shares to be allotted
pursuant to the provisions of paragraph (1) of this Article |
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shall rank for participation in such distribution, bonus or rights. |
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(b) |
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The Board may do all acts and things considered necessary or
expedient to give effect to any capitalisation pursuant to the provisions of
paragraph (1) of this Article, with full power to the Board to make such
provisions as it thinks fit in the case of shares becoming distributable in
fractions (including provisions whereby, in whole or in part, fractional
entitlements are aggregated and sold and the net proceeds distributed to those
entitled, or are disregarded or rounded up or down or whereby the benefit of
fractional entitlements accrues to the Company rather than to the Members
concerned). The Board may authorise any person to enter into on behalf of all
Members interested, an agreement with the Company providing for such
capitalisation and matters incidental thereto and any agreement made pursuant
to such authority shall be effective and binding on all concerned. |
(3) The Company may upon the recommendation of the Board by ordinary resolution resolve in
respect of any one particular dividend of the Company that notwithstanding the provisions of
paragraph (1) of this Article a dividend may be satisfied wholly in the form of an allotment of
shares credited as fully paid up without offering any right to shareholders to elect to receive
such dividend in cash in lieu of such allotment.
(4) The Board may on any occasion determine that rights of election and the allotment of
shares under paragraph (1) of this Article shall not be made available or made to any shareholders
with registered addresses in any territory where, in the absence of a registration statement or
other special formalities, the circulation of an offer of such rights of election or the allotment
of shares would or might, in the opinion of the Board, be unlawful or impracticable, and in such
event the provisions aforesaid shall be read and construed subject to such determination. Members
affected as a result of the foregoing sentence shall not be or be deemed to be a separate class of
Members for any purpose whatsoever.
(5) Any resolution declaring a dividend on shares of any class, whether a resolution of
the Company in general meeting or a resolution of the Board, may specify that the same shall be
payable or distributable to the persons registered as the holders of such shares at the close of
business on a particular date, notwithstanding that it may be a date prior to that on which the
resolution is passed, and thereupon the dividend shall be payable or distributable to them in
accordance with their respective holdings so registered, but without prejudice to the rights inter
se in respect of such dividend of transferors and transferees of any such shares. The provisions
of this Article shall mutatis mutandis apply to bonuses, capitalisation issues, distributions of
realised capital profits or offers or grants made by the Company to the Members.
RESERVES
143. (1) The Board shall establish an account to be called the share premium account and
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shall carry to the credit of such account from time to time a sum equal to the amount or value of
the premium paid on the issue of any share in the Company. Unless otherwise provided by the
provisions of these Articles, the Board may apply the share premium account in any manner permitted
by the Law. The Company shall at all times comply with the provisions of the Law in relation to
the share premium account.
(2) Before recommending any dividend, the Board may set aside out of the profits of the
Company such sums as it determines as reserves which shall, at the discretion of the Board, be
applicable for any purpose to which the profits of the Company may be properly applied and pending
such application may, also at such discretion, either be employed in the business of the Company or
be invested in such investments as the Board may from time to time think fit and so that it shall
not be necessary to keep any investments constituting the reserve or reserves separate or distinct
from any other investments of the Company. The Board may also without placing the same to reserve
carry forward any profits which it may think prudent not to distribute.
CAPITALISATION
144. The Company may, upon the recommendation of the Board, at any time and from time to time pass
an ordinary resolution to the effect that it is desirable to capitalise all or any part of any
amount for the time being standing to the credit of any reserve or fund (including a share premium
account and capital redemption reserve and the profit and loss account) whether or not the same is
available for distribution and accordingly that such amount be set free for distribution among the
Members or any class of Members who would be entitled thereto if it were distributed by way of
dividend and in the same proportions, on the footing that the same is not paid in cash but is
applied either in or towards paying up the amounts for the time being unpaid on any shares in the
Company held by such Members respectively or in paying up in full unissued shares, debentures or
other obligations of the Company, to be allotted and distributed credited as fully paid up among
such Members, or partly in one way and partly in the other, and the Board shall give effect to such
resolution provided that, for the purposes of this Article, a share premium account and any capital
redemption reserve or fund representing unrealised profits, may be applied only in paying up in
full unissued shares of the Company to be allotted to such Members credited as fully paid.
145. The Board may settle, as it considers appropriate, any difficulty arising in regard to
any distribution under the last preceding Article and in particular may issue certificates in
respect of fractions of shares or authorise any person to sell and transfer any fractions or may
resolve that the distribution should be as nearly as may be practicable in the correct proportion
but not exactly so or may ignore fractions altogether, and may determine that cash payments shall
be made to any Members in order to adjust the rights of all parties, as may seem expedient to the
Board. The Board may appoint any person to sign on behalf of the persons entitled to participate
in the distribution any contract necessary or desirable for giving effect thereto and such
appointment shall be effective and binding upon the Members.
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SUBSCRIPTION RIGHTS RESERVE
146. The following provisions shall have effect to the extent that they are not prohibited by and
are in compliance with the Law:
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(1) |
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If, so long as any of the rights attached to any warrants issued by the Company
to subscribe for shares of the Company shall remain exercisable, the Company does any
act or engages in any transaction which, as a result of any adjustments to the
subscription price in accordance with the provisions of the conditions of the warrants,
would reduce the subscription price to below the par value of a share, then the
following provisions shall apply: |
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(a) |
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as from the date of such act or transaction the Company shall establish and
thereafter (subject as provided in this Article) maintain in accordance with the
provisions of this Article a reserve (the Subscription Rights Reserve) the amount of
which shall at no time be less than the sum which for the time being would be required
to be capitalised and applied in paying up in full the nominal
amount of the additional shares required to be issued and allotted credited as fully
paid pursuant to sub-paragraph (c) below on the exercise in full of all the
subscription rights outstanding and shall apply the Subscription Rights Reserve in
paying up such additional shares in full as and when the same are allotted; |
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(b) |
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the Subscription Rights Reserve shall not be used for any purpose other than
that specified above unless all other reserves of the Company (other than share premium
account) have been extinguished and will then only be used to make good losses of the
Company if and so far as is required by law; |
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(c) |
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upon the exercise of all or any of the subscription rights represented by any
warrant, the relevant subscription rights shall be exercisable in respect of a nominal
amount of shares equal to the amount in cash which the holder of such warrant is
required to pay on exercise of the subscription rights represented thereby (or, as the
case may be the relevant portion thereof in the event of a partial exercise of the
subscription rights) and, in addition, there shall be allotted in respect of such
subscription rights to the exercising warrantholder, credited as fully paid, such
additional nominal amount of shares as is equal to the difference between: |
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(i) |
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the said amount in cash which the holder of such warrant is
required to pay on exercise of the subscription rights represented thereby (or,
as the case may be, the relevant portion thereof in the event of a partial
exercise of the subscription rights); and |
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(ii) |
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the nominal amount of shares in respect of which such subscription
rights would have been exercisable having regard to the provisions of |
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the conditions of the warrants, had it been possible for such subscription
rights to represent the right to subscribe for shares at less than par and
immediately upon such exercise so much of the sum standing to the credit of
the Subscription Rights Reserve as is required to pay up in full such
additional nominal amount of shares shall be capitalised and applied in
paying up in full such additional nominal amount of shares which shall
forthwith be allotted credited as fully paid to the exercising
warrantholders; and |
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(d) |
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if, upon the exercise of the subscription rights represented by any warrant,
the amount standing to the credit of the Subscription Rights Reserve is not sufficient
to pay up in full such additional nominal amount of shares equal to such difference as
aforesaid to which the exercising warrantholder is entitled, the Board shall apply any
profits or reserves then or thereafter becoming available (including, to the extent
permitted by law, share premium account) for such purpose until such additional nominal
amount of shares is paid up and allotted as aforesaid and until then no dividend or
other distribution shall be paid or made on the fully paid shares of the Company then
in issue. Pending such payment and allotment, the exercising warrantholder shall be
issued by the Company with a certificate evidencing his right to the allotment of such
additional nominal amount of shares. The rights represented by any such certificate
shall be in registered form and shall be transferable in whole or in part in units of
one share in the like manner as the shares for the time being are transferable, and the
Company shall make such arrangements in relation to the maintenance of a register
therefor and other matters in relation thereto as the Board may think fit and adequate
particulars thereof shall be made known to each relevant exercising warrantholder upon
the issue of such certificate. |
(2) Shares allotted pursuant to the provisions of this Article shall rank pari passu in all
respects with the other shares allotted on the relevant exercise of the subscription rights
represented by the warrant concerned. Notwithstanding anything contained in paragraph (1) of this
Article, no fraction of any share shall be allotted on exercise of the subscription rights.
(3) The provision of this Article as to the establishment and maintenance of the Subscription
Rights Reserve shall not be altered or added to in any way which would vary or abrogate, or which
would have the effect of varying or abrogating the provisions for the benefit of any warrantholder
or class of warrantholders under this Article without the sanction of a special resolution of such
warrantholders or class of warrantholders.
(4) A certificate or report by the auditors for the time being of the Company as to
whether or not the Subscription Rights Reserve is required to be established and maintained and if
so the amount thereof so required to be established and maintained, as to the purposes for which
the Subscription Rights Reserve has been used, as to the extent to which it has been used to make
good losses of the Company, as to the additional nominal amount of shares required to be allotted
to exercising warrantholders credited as fully paid, and as
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to any other matter concerning the Subscription Rights Reserve shall (in the absence of
manifest error) be conclusive and binding upon the Company and all warrantholders and shareholders.
ACCOUNTING RECORDS
147. The Board shall cause true accounts to be kept of the sums of money received and expended by
the Company, and the matters in respect of which such receipt and expenditure take place, and of
the property, assets, credits and liabilities of the Company and of all other matters required by
the Law or necessary to give a true and fair view of the Companys affairs and to explain its
transactions.
148. The accounting records shall be kept at the Office or, at such other place or places as the
Board decides and shall always be open to inspection by the Directors. No Member (other than a
Director) shall have any right of inspecting any accounting record or book or document of the
Company except as conferred by law or authorised by the Board or the Company in general meeting.
149. Subject to Article 150, a printed copy of the Directors report, accompanied by the balance
sheet and profit and loss account, including every document required by law to be annexed thereto,
made up to the end of the applicable financial year and containing a summary of the assets and
liabilities of the Company under convenient heads and a statement of income and expenditure,
together with a copy of the Auditors report, shall be sent to each person entitled thereto at
least ten (10) days before the date of the general meeting and laid before the Company at the
annual general meeting held in accordance with Article 56 provided that this Article shall not
require a copy of those documents to be sent to any person whose address the Company is not aware
or to more than one of the joint holders of any shares or debentures.
150. Subject to due compliance with all applicable Statutes, rules and regulations, including,
without limitation, the rules of the Designated Stock Exchange, and to obtaining all necessary
consents, if any, required thereunder, the requirements of Article 149 shall be deemed satisfied in
relation to any person by sending to the person in any manner not prohibited by the Statutes, a
summary financial statement derived from the Companys annual accounts and the directors report
which shall be in the form and containing the information required by applicable laws and
regulations, provided that any person who is otherwise entitled to the annual financial statements
of the Company and the directors report thereon may, if he so requires by notice in writing served
on the Company, demand that the Company sends to him, in addition to a summary financial statement,
a complete printed copy of the Companys annual financial statement and the directors report
thereon.
151. The requirement to send to a person referred to in Article 149 the documents referred to in
that article or a summary financial report in accordance with Article 150 shall be deemed satisfied
where, in accordance with all applicable Statutes, rules and regulations, including, without
limitation, the rules of the Designated Stock Exchange, the Company publishes copies of the
documents referred to in Article 149 and, if applicable, a summary
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financial report complying with Article 150, on the Companys computer network or in any other
permitted manner (including by sending any form of electronic communication), and that person has
agreed or is deemed to have agreed to treat the publication or receipt of such documents in such
manner as discharging the Companys obligation to send to him a copy of such documents.
AUDIT
152. Subject to applicable law and rules of the Designated Stock Exchange, the Directors shall
appoint an auditor to audit the accounts of the Company and such auditor shall hold office until
the Directors appoint another auditor. Such auditor may be a Member but no Director or officer or
employee of the Company shall, during his continuance in office, be eligible to act as an auditor
of the Company.
153. Subject to the Law the accounts of the Company shall be audited at least once in every
year.
154. The remuneration of the Auditor shall be fixed by the Board.
155. If the office of auditor becomes vacant by the resignation or death of the Auditor, or by his
becoming incapable of acting by reason of illness or other disability at a time when his services
are required, the Directors shall fill the vacancy and determine the remuneration of such Auditor.
156. The Auditor shall at all reasonable times have access to all books kept by the Company and to
all accounts and vouchers relating thereto; and he may call on the Directors or officers of the
Company for any information in their possession relating to the books or affairs of the Company.
157. The statement of income and expenditure and the balance sheet provided for by these Articles
shall be examined by the Auditor and compared by him with the books, accounts and vouchers relating
thereto; and he shall make a written report thereon stating whether such statement and balance
sheet are drawn up so as to present fairly the financial position of the Company and the results of
its operations for the period under review and, in case information shall have been called for from
Directors or officers of the Company, whether the same has been furnished and has been
satisfactory. The financial statements of the Company shall be audited by the Auditor in
accordance with generally accepted auditing standards. The Auditor shall make a written report
thereon in accordance with generally accepted auditing standards and the report of the Auditor
shall be submitted to the Members in general meeting. The generally accepted auditing standards
referred to herein may be those of a country or jurisdiction other than the Cayman Islands. If so,
the financial statements and the report of the Auditor should disclose this act and name such
country or jurisdiction.
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NOTICES
158. Any Notice or document, whether or not, to be given or issued under these Articles from the
Company to a Member shall be in writing or by cable, telex or facsimile transmission message or
other form of electronic transmission or communication and any such Notice and document may be
served or delivered by the Company on or to any Member either personally or by sending it through
the post in a prepaid envelope addressed to such Member at his registered address as appearing in
the Register or at any other address supplied by him to the Company for the purpose or, as the case
may be, by transmitting it to any such address or transmitting it to any telex or facsimile
transmission number or electronic number or address or website supplied by him to the Company for
the giving of Notice to him or which the person transmitting the notice reasonably and bona fide
believes at the relevant time will result in the Notice being duly received by the Member or may
also be served by advertisement in appropriate newspapers in accordance with the requirements of
the Designated Stock Exchange or, to the extent permitted by the applicable laws, by placing it on
the Companys website and giving to the member a notice stating that the notice or other document
is available there (a notice of availability). The notice of availability may be given to the
Member by any of the means set out above. In the case of joint holders of a share all notices
shall be given to that one of the joint holders whose name stands first in the Register and notice
so given shall be deemed a sufficient service on or delivery to all the joint holders.
159. Any Notice or other document:
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(a) |
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if served or delivered by post, shall where appropriate be sent by airmail and
shall be deemed to have been served or delivered on the day following that on which the
envelope containing the same, properly prepaid and addressed, is put into the post; in
proving such service or delivery it shall be sufficient to prove that the envelope or
wrapper containing the notice or document was properly addressed and put into the post
and a certificate in writing signed by the Secretary or other officer of the Company or
other person appointed by the Board that the envelope or wrapper containing the notice
or other document was so addressed and put into the post shall be conclusive evidence
thereof; |
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(b) |
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if sent by electronic communication, shall be deemed to be given on the day on
which it is transmitted from the server of the Company or its agent. A notice placed
on the Companys website is deemed given by the Company to a Member on the day
following that on which a notice of availability is deemed served on the Member; |
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(c) |
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if served or delivered in any other manner contemplated by these Articles,
shall be deemed to have been served or delivered at the time of personal service or
delivery or, as the case may be, at the time of the relevant despatch or transmission;
and in proving such service or delivery a certificate in writing signed by the
Secretary or other officer of the Company or other person appointed by the Board as to
the act and time of such service, |
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delivery, despatch or transmission shall be
conclusive evidence thereof; and |
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(d) |
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may be given to a Member in the English language or such other language as may
be approved by the Directors, subject to due compliance with all applicable Statutes,
rules and regulations. |
160. (1) Any Notice or other document delivered or sent by post to or left at the registered
address of any Member in pursuance of these Articles shall, notwithstanding that such Member is
then dead or bankrupt or that any other event has occurred, and whether or not the Company has
notice of the death or bankruptcy or other event, be deemed to have been duly served or delivered
in respect of any share registered in the name of such Member as sole or joint holder unless his
name shall, at the time of the service or delivery of the notice or document, have been removed
from the Register as the holder of the share, and such service or delivery shall for all purposes
be deemed a sufficient service or delivery of such Notice or document on all persons interested
(whether jointly with or as claiming through or under him) in the share.
(2) A notice may be given by the Company to the person entitled to a share in consequence of
the death, mental disorder or bankruptcy of a Member by sending it through the post in a prepaid
letter, envelope or wrapper addressed to him by name, or by the title of representative of the
deceased, or trustee of the bankrupt, or by any like description, at the address, if any, supplied
for the purpose by the person claiming to be so entitled, or (until such an address has been so
supplied) by giving the notice in any manner in which the same might have been given if the death,
mental disorder or bankruptcy had not occurred.
(3) Any person who by operation of law, transfer or other means whatsoever shall become
entitled to any share shall be bound by every notice in respect of such share which prior to his
name and address being entered on the Register shall have been duly given to the person from whom
he derives his title to such share.
SIGNATURES
161. For the purposes of these Articles, a cable or telex or facsimile or electronic transmission
message purporting to come from a holder of shares or, as the case may be, a Director, or, in the
case of a corporation which is a holder of shares from a director or the secretary thereof or a
duly appointed attorney or duly authorised representative thereof for it and on its behalf, shall
in the absence of express evidence to the contrary available to the person relying thereon at the
relevant time be deemed to be a document or instrument in writing signed by such holder or Director
in the terms in which it is received.
WINDING UP
162. (1) The Board shall have power in the name and on behalf of the Company to present a petition
to the court for the Company to be wound up.
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(2) A resolution that the Company be wound up by the court or be wound up
voluntarily shall be a special resolution.
163. (1) Subject to any special rights, privileges or restrictions as to the distribution of
available surplus assets on liquidation for the time being attached to any class or classes of
shares (i) if the Company shall be wound up and the assets available for distribution amongst the
Members of the Company shall be more than sufficient to repay the whole of the capital paid up at
the commencement of the winding up, the excess shall be distributed pari passu amongst such members
in proportion to the amount paid up on the shares held by them respectively and (ii) if the Company
shall be wound up and the assets available for distribution amongst the Members as such shall be
insufficient to repay the whole of the paid-up capital such assets shall be distributed so that, a
nearly as may be, the losses shall be borne by the Members in proportion to the capital paid up, or
which ought to have been paid up, at the commencement of the winding up on the shares held by them
respectively.
(2) If the Company shall be wound up (whether the liquidation is voluntary or by the court)
the liquidator may, with the authority of a special resolution and any other sanction required by
the Law, divide among the Members in specie or kind the whole or any part of the assets of the
Company and whether or not the assets shall consist of properties of one kind or shall consist of
properties to be divided as aforesaid of different kinds, and may for such purpose set such value
as he deems fair upon any one or more class or classes of property and may determine how such
division shall be carried out as between the Members or different classes of Members. The
liquidator may, with the like authority, vest any part of the assets in trustees upon such trusts
for the benefit of the Members as the liquidator with the like authority shall think fit, and the
liquidation of the Company may be closed and the Company dissolved, but so that no contributory
shall be compelled to accept any shares or other property in respect of which there is a liability.
INDEMNITY
164. (1) The Directors, Secretary and other officers for the time being of the Company and the
liquidator or trustees (if any) for the time being acting in relation to any of the affairs of the
Company and everyone of them, and everyone of their heirs, executors and administrators, shall be
indemnified and secured harmless out of the assets and profits of the Company from and against all
actions, costs, charges, losses, damages and expenses which they or any of them, their or any of
their heirs, executors or administrators, shall or may incur or sustain by or by reason of any act
done, concurred in or omitted in or about the execution of their duty, or supposed duty, in their
respective offices or trusts; and none of them shall be answerable for the acts, receipts, neglects
or defaults of the other or others of them or for joining in any receipts for the sake of
conformity, or for any bankers or other persons with whom any moneys or effects belonging to the
Company shall or may be lodged or deposited for safe custody, or for insufficiency or deficiency of
any security upon which any moneys of or belonging to the Company shall be placed out on or
invested, or for any other loss, misfortune or damage which may happen in the execution of their
respective
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offices or trusts, or in relation thereto; PROVIDED THAT this indemnity shall not extend
to any matter in respect of any fraud or dishonesty which may attach to any of said persons.
(2) Each Member agrees to waive any claim or right of action he might have, whether
individually or by or in the right of the Company, against any Director on account of any action
taken by such Director, or the failure of such Director to take any action in the performance of
his duties with or for the Company; PROVIDED THAT such waiver shall not extend to any matter in
respect of any fraud or dishonesty which may attach to such Director.
AMENDMENT TO MEMORANDUM AND ARTICLES OF ASSOCIATION
AND NAME OF COMPANY
165. No Article shall be rescinded, altered or amended and no new Article shall be made until the
same has been approved by a special resolution of the Members. A special resolution shall be
required to alter the provisions of the Memorandum of Association or to change the name of the
Company.
INFORMATION
166. No Member shall be entitled to require discovery of or any information respecting any detail
of the Companys trading or any matter which is or may be in the nature of a trade secret or secret
process which may relate to the conduct of the business of the Company and which in the opinion of
the Directors it will be inexpedient in the interests of the members of the Company to communicate
to the public.
REGISTRATION BY WAY OF CONTINUATION
167. The Company may by Special Resolution resolve to be registered by way of continuation in a
jurisdiction outside the Cayman Islands or such other jurisdiction in which it is for the time
being incorporated, registered or existing. In furtherance of a resolution adopted pursuant to this
Article, the Directors may cause an application to be made to the Registrar of Companies to
deregister the Company in the Cayman Islands or such other jurisdiction in which it is for the time
being incorporated, registered or existing and may cause all such further steps as they consider
appropriate to be taken to effect the transfer by way of continuation of the Company.
EX-5.1
Exhibit 5.1
September 2, 2010
SouFun Holdings Limited
8th Floor, Tower 3, Xihuan Plaza
No.1 Xizhimenwai
Xicheng District
Beijing 100044
P.R.C.
Dear Sirs,
Re: SouFun Holdings Limited (the Company)
We have acted as special Cayman Islands legal counsel to the Company in connection with a
registration statement on Form F-1 to be filed with the U.S. Securities and Exchange Commission
(the Commission) (the Registration Statement, which term does not include any other document or
agreement whether or not specifically referred to therein or attached as an exhibit or schedule
thereto), relating to the registration under the U.S. Securities Act of 1933, as amended (the
Securities Act) of class A ordinary shares, par value HK$1.00 to be offered by certain
shareholders of the Company (the Ordinary Shares).
For the purposes of giving this opinion, we have examined a copy of the Registration Statement. We
have also reviewed the memorandum of association and articles of association of the Company, each
certified by the Secretary of the Company on September 2, 2010, copies of written resolutions of
the members of the Company passed on August 4, 2010 and written resolutions of the board of
directors of the Company passed on August 4, 2010, a certificate of good standing issued by the
Registrar of Companies in relation to the Company on July 15, 2010 (the Certificate Date) and
such other documents and made such enquiries as to questions of law as we have deemed necessary in
order to render the opinion set forth below.
We have assumed (a) the genuineness and authenticity of all signatures and the conformity to the
originals of all copies (whether or not certified) examined by us and the authenticity and
completeness of the originals from which such copies were taken; (b) that where a document has been
examined by us in draft form, it will be or has been executed in the form of that draft, and where
a number of drafts of a document have been examined by us all changes thereto have been marked or
otherwise drawn to our attention; (c) the accuracy and completeness of all factual representations
made in the Registration Statement and other documents reviewed by us; and (d) that there is no
provision of the law of any jurisdiction, other than the Cayman Islands, which would have any
implication in relation to the opinions expressed herein.
We have made no investigation of and express no opinion in relation to the laws of any jurisdiction
other than the Cayman Islands. This opinion is to be governed by and construed in accordance with
the laws of the Cayman Islands and is limited to and is given on the basis of the current law and
practice in the Cayman Islands. This opinion is issued solely for the purposes of filing the
Registration Statement and the offering of the Ordinary Shares by the Company and is not to be
relied upon in respect of any other matter.
On the basis of and subject to the foregoing, we are of the opinion that:
1. |
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As at the Certificate Date, the Company is duly incorporated and existing under the laws of
the Cayman Islands in good standing (meaning solely that it has not failed to make any filing
with any Cayman Islands government authority or to pay any Cayman Islands government fee which
would
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make it liable to be struck off by the Registrar of Companies and thereby cease to exist
under the laws of the Cayman Islands). |
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2. |
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The Ordinary Shares, when sold as contemplated by the Registration Statement, will be duly
authorised by the Company and validly issued, fully paid and non-assessable (which term means
when used herein that no further sums are required to be paid by the holders thereof in
connection with the issue of such shares). |
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to
the references to our firm under the captions Enforceability of Civil Liabilities and Legal
Matters in the prospectus forming a part of the Registration Statement. In giving this consent, we
do not hereby admit that we are experts within the meaning of Section 11 of the Securities Act or
that we are within the category of persons whose consent is required under Section 7 of the
Securities Act or the Rules and Regulations of the Commission promulgated thereunder.
Yours faithfully,
Conyers Dill & Pearman
2