EFTA01849248.pdf

Draft-07-024042; CMH/JJXCOHEIG 13 March 2012 INVESTMENT LETTER To: Hedosophia Alpha Limited Roseneath. The Grange. St Peter Port. Guernsey GY1 3QJ We (the investor) agree to transfer to Hedosophia Alpha Limited (the 'Company') the amount set out below for investment on the following terms: Investment amount: The Investor will transfer to the Company US$1..1 million in immediately available cleared funds. on the date of signature of this document, into the bank account of the Company with ABN Amro (Guernsey) Limited of-PO-Box-2.53 Martello Court. Admiral Park. St Peter Port, Guernsey, GY1 30.l. as notified to the Investor. We anticipate the Company will enter into investment letters with up to (Ave) other investors (togethecwith.you_Smestore) over the next 30 days such that the Company will have funds for investment of between USS50 and 80 million. Investment proposition: The Company will seek to invest its funds in hotting the equity securities of privatelyheld consumer Internet companies ('Investments') as determined by the board of the Company. It is intended that the funds will have been fully invested within six months pr c• f;:n;l5 Cepcv.oe '77'7.'7 77 77 To the extent any funds (ne-fueling all Interest earned on funds price to making the Investments and on any uninvested funds) ha..o not been invested by [31 Decernboll 2012 (the 'final investment date). they will be repaid promptly to Investors en-ants,eininveieted-funde) in proportion to the amounts they transferred to the Company ('investment proportions') No gambl[ng or alcohol related investments may be made by the Company. Return on Investments: Until the full investment amount transferred to the Company by the Investor-and.ether Investors has been repaid (pari passu as between all-such Investors). all distributions and sales proceeds from Investments (net of all costs directly associated with making or realising investments. including any taxes, duties and similar charges ('transaction costs")) will be applied in repayment to all Investors, in their investment proportions, promptly upon receipt by the Company in respect of each Investment. Thereafter 70 per cent. of all distributions and sales proceeds from Investments (not of transaction costs) will be paid to all Investors in their investment proportions promptly upon receipt by the Company in respect of each Investment. and the remaining 30 per cent. will be retained by the Company. If. on 28 February 2017 (the 'termination date). the Company holds any Investment (Remaining Investment'. which shall Include the securities comprising that Investment and any cash realised from Investment(s) net). the Remaining Investment will be transferred to-all Investors (not of transaction costs) in their investment proportions on the following basis: (1) to the extent applicable on the termination date. the Remaining Investment will bo so transferred to all Investors until the full investment amounts originally transferred by them have boon repaid: (2) thereafter. 70 per cent. of any balance of the Remaining Investment will be so transferred to--all Investors. and 30 per cent. will be retained by the Company: and (3) for these purposes. the Company will determine the value of the Remaining Investment using: 0) the price of the most recent issue of new securities or sale of existing securities subsequent to. and comprising, that Investment which was in respect of no less than 0.5 per cent. of the issued equity securities of the company concerned (being. for each Investment, its Valuator'): or (ii) in the event that an Investment OKWoes not have a valuation. the price of the most recent issue of new securities or sale of existing securities comprising that Investment. In the event that betheath of the Directors (as defined below): either-(1) dies or becomes immediately and permanently incapacitated so severely that it is impossible for either-of4hernhim to act as a director of the Companyer-(24-arelpermarendy incapacitated hero shall include having a bankruptcy order made against him by a court in England. Hong Kong. Or Germany): (2) is certified, in a written opinion by a registered medical practitioner treating that-Dereotes-whe-ceves-a-weitteci-opinien-statinu-thaSeuch-Directerthe Director concerned that he has become physically or mentally incapable of acting as a director of tho Company and may remain so for more than three months: or (3) together with the oth_Diroctor no longer directly Of indirectly controls Over 50 per cent of the issued shares of the Comoapv ("control' I then the proves/Dna of the previeusimmedigtelv Ofeeeding paragraph shall apply. 40-4446-casex4heitto termination date shall be: taper; in the case of (1). the date of the death or permanent incapacity of the second Director: and-in the case of (2), the date of the medical certificate relating to the second DIrectorLoLio the case of (3), the date at which the Company's shareholder recoster is updated to reflect that the Directors no longer control the Company. Should the termination date occur before the final investment date, the provisions.under, 'Investment Proposition' above relating to return of uninvested funds shall also apply. The articles of association of the Company have been amended to include a prevision that, on-the- deallser-ineapabity-01-beth-DgeOtere-a&shot.'d an;, cent described in [1R3) above,occur. the Company's administrator (currently the-Trust Corporation of the Channel Islands Limited) will automatically have individual(s) appointed as directors to implement the provisions of this letter including transferring any Investments. EFTA_R1_00241232 EFTA01849248  2 Restrictions on investments by Directors: The Company wi41 beg owned and managed by Ian Osborne and Jacob Burda (the 'Directors') as a 50)50 pint venture company. Until the funds of the Company have boon fully invested (or. it later. the final investment date). the Company. shall procure neither of the Directors, nor any entity with which he is connected, shall make any Investment except through the Company. This restriction shall not apply to: (1) any passive...minerityiaggregating an investments of DileCterisil investments the Directors make in other third party managed funds investing in the internist sector: or (2) any share-based remuneration received for advisory or consultancy services given by any entity with which any Director is connected (together 'Exempt Investments`). The Due-PteffiCompany shall notify the Investors of the names of any Exempt Investments. and also if any such advisory or consultancy services are provided to companies convp4singin which Investments - are made.AlLOW0ialge(_lavoStinentamollgemadelopersonWlirlistuch_rteDiteCter rs.tnterested.unless °therm:se agreed with Investors. Any secured finaneuxt made by the Company will be made Only with the Prier agreement of the Investors No fees/expenses: No funds provided by any Investor will be used to meet any expenses of the Company. other than transaction costs. These expenses will be mot through funds provided to the Company by its shareholders. No management or other investment advisory fee will bo paid by the Company to any person. Reporting obligations: The Company will provide to the Investors: (1) annual audited accounts and reports with details of the Investments made and the financial position of the Company; and (2) quarterly letters giving information in respect of the Investments. including confirmation from the Company's accountants (currently Grant Thornton. Channel Islands) of the Investments held by the Company. Transfer terms: The transfer of the investment amount shall constitute the advance of a loan by the Investor to the Company. Interest shall only_ accrue on this loan to the extent provided forctated in relation to funds held before investment under •Invostment proposition' above. This loan shall be 111£43CUP34 and carry no voting rights or proprietary rights in the capital of the Company: and it shall only be repayable on the terms of this document, including on a winding u➢ of the _Company or in the event of a Malone! Breach as defined below), if and to the extent that (1) the Company receives distributions and/or sale proceeds from Investments or. (2) after the termination date, the Company makes a repayment in kind through the transfer of securities comprising Investments. The Investor will not be entitled to demand repayment of the investment amount in any other circumstances and hereby agrees that it will not exercise any right to do so. The Investor undertakes not to transfer this loan to any person save to an entity which is either: controlled by the same person(s); managed by the same person; or has the same beneficiaries, in each case, as the investor. :Material Breech-shall mean a material breach of a material term of this letter notified by the_ Investor to the Company_ in writing La Material Breach Notice'), which is not remedied within a reasonable time and following the Company nodona the remaining Investors of the Material Breach 75 in numbetottheamaining _Investors COMM) in wntind the loan should be rePavable on the terms of this document by reason of that Marone' Broach Law:-Confidenbality and Law: Except as required by law or regulation or (upon prior approval by the Investors) to the COmPanYS advisors and bankers. the Comoenv will not disclose the names or profiles of the Investors to any person This document is governed by and will be construed in accordance with two law of England. The courts of England are to have each/shy jurisdiction to settle any dispute ansing out of or in connection with this document. From: Agreed: (Investor's full name in block capitals) Hedosophia Alpha Limited By: Director By: Authorised signatory Address: Date: 2012 2 Workshare Professional comparison of CC_510774411_21.DOC and CC_511247491_ I 5.DOC. Performed on 13/03/2012. EFTA_R1_00241233 EFTA01849249 Document comparison by Workshare Professional on 13 March 2012 12:44:13 Input: Document 1 ID CATempNetRight‘Compare1CC_510774411_21.DOC Description CATemplNetRight‘CompareICC_510774411_21.DOC Document 2 ID CATemp\tsletRight‘Compare\CC 511247491 15.DOC Description CATemp\NetRight1Compare\CC_511247491_15.DOC Rendering set SandMMoves2 Legend: Insertion Deletietv- Style change Format change Moved deletion Inserted cell Deleted cell Moved cell Split/Merged cell Padding cell Statistics: Count Insertions 37 Deletions 33 Moved from 1 Moved to 1 Style change 0 Format changed 79 Total changes 151 3 Workshare Professional comparison of CC_510774411_21.DOC and CC_51124749I_15.DOC. Performed on 13/03/2012. EFTA_R1_00241234 EFTA01849250