Pledge Agreement Contract Template

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Pledge Agreement

 

This Pledge Agreement (hereinafter referred to as the “Agreement”) is made and entered into as of July 28, 2016, by and between Party A and Party B.

 

  1. The Equity Exchange has filed an application with the Shenzhen Stock Exchange (“SZSE”) in accordance with the Provisions for the Administration of Equity Exchange and the Rules for the Administration of Exchange, and has obtained the approval of the SZSE for the establishment of the Qianhai Equity Exchange (the “Exchange”);

 

  1. Party A and Party B have entered into the Equity Exchange Membership Agreement (the “Membership Agreement”) dated as of July 28, 2016, and the Equity Exchange Clearing Agreement (the “Clearing Agreement”) dated as of July 28, 2016, and have thus become members of the Exchange;

 

  1. In accordance with the law, the Provisions for the Administration of Equity Exchange and the Rules for the Administration of Exchange, the Parties shall sign the following pledge agreement to pledge the shares in the pledged company (as defined below) to the Exchange as security for the performance of the Parties’ obligations under the Membership Agreement, the Clearing Agreement and other relevant agreements; NOW, THEREFORE, the Parties agree as follows:

 

  1. Definitions

 

1.1 In this Agreement, unless otherwise specified or required by the context, the following terms shall have the following meanings:

 

1.1.1 For purposes of this Agreement, the term "Affiliates" means any Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the pledgor or the pledgee. Control shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of the controlled entity, whether through ownership of voting securities, by contract, or otherwise. Without limiting the foregoing, control shall be presumed to exist where one entity owns, directly or indirectly, more than 50% of the voting stock or ownership interests of another entity. The term "Person" means an individual, corporation, partnership, limited liability company, trust, joint venture, association, joint-stock company, or any other entity or organization.

 

1.1.2 “Business Day” means, with respect to any action required or permitted to be taken on a particular day, any day other than a Saturday, Sunday or official public holiday in Shenzhen, Guangdong Province, China.

 

1.1.3 “Equity Exchange Membership Rules” means the Equity Exchange Membership Rules formulated by the Equity Exchange from time to time. 1.1.4 “Exchange” has the meaning set forth in the preamble hereto.

 

1.1.5 “Governmental Authority” means any governmental or quasi-governmental body, agency, department, commission, court, tribunal or arbitrator, whether domestic or foreign.

 

1.1.6 “Laws” means any laws, regulations, ordinances, statutes, treaties, rules, codes, edicts, judgments, orders, decrees, injunctions, writs, awards, permissions, licenses, quotas, charges and charges imposed by a Governmental Authority.

 

1.1.7 “Member” means a member of the Exchange as defined in the Equity Exchange Membership Rules.

 

1.1.8 “Membership Agreement” means the Equity Exchange Membership Agreement entered into by and between Party A and Party B on July 28, 2016.

 

1.1.9 “Person” means any individual, corporation, partnership, limited partnership, joint venture, trust, unincorporated organization or Governmental Authority.

 

1.1.10 “Pledged Company” means Shenzhen Qianhai Equity Exchange Co., Ltd., a limited liability company legally established and validly existing under the laws of the People’s Republic of China, with its registered address at Floor 11-15, Building A, Phase I, Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone, Nanshan District, Shenzhen, Guangdong Province, China.

 

1.1.11 “Pledged Shares” means the ( ) shares of common stock of the Pledged Company, with a par value of RMB 0.10 per share, issued by the Pledged Company and legally and beneficially owned by Party A.

 

1.1.12 “Profit” means the proceeds of the Pledged Shares that Party A receives from the disposal of the Pledged Shares.

 

1.1.13 “Securities Law” means the Securities Law of the People’s Republic of China.

1.1.14 “Shenzhen Stock Exchange Membership Rules” means the Shenzhen Stock Exchange Membership Rules formulated by the SZSE from time to time.

 

1.1.15 “SZSE” means Shenzhen Stock Exchange.

 

1.1.16 “SZSE Membership Rules” means the Shenzhen Stock Exchange Membership Rules formulated by the SZSE from time to time.

 

1.2 Unless otherwise specified or required by the context, the following terms shall have the following meanings when used in this Agreement:

 

1.2.1 “including”, “include”, and other similar terms, when used in this Agreement, shall be deemed to be followed by “without limitation” or other similar phrase;

 

1.2.2 The headings in this Agreement are for reference only and shall not affect the interpretation hereof;

 

1.2.3 The use of any gender herein shall include all genders;

 

1.2.4 The use of the singular herein shall include the plural and vice versa;

 

1.2.5 The use of any terminology herein shall be deemed to include any equivalent terminology;

 

1.2.6 The use of the term “Party” herein shall include both of the Parties and the use of the term “Parties” herein shall be deemed to mean both of the Parties;

 

1.2.7 The use of the term “herein”, “hereunder”, “hereby”, “hereof”, or similar terms in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement;

 

1.2.8 The use of any terminology herein shall be deemed to include any similar terminology; and

 

1.2.9 The use of the term “shall” in this Agreement is mandatory and the use of the term “may” in this Agreement is permissive.

 

  1. Pledge of Pledged Shares

 

2.1 Party A hereby pledges and grants to the Exchange a security interest in the Pledged Shares and all rights attached to the Pledged Shares as collateral for the performance of Party A's obligations under the Membership Agreement, the Clearing Agreement, and any other agreements between the Parties (collectively referred to as the 'Agreements'). The Pledged Shares shall be held in custody by the Exchange and shall only be used to secure the performance of Party A's obligations under the Agreements.

 

For the purposes of this Agreement, 'Pledged Shares' means the shares of stock or other equity interests in any entity owned by Party A, as set forth in Schedule 1 attached hereto, and any additional shares or interests in any such entity subsequently acquired by Party A and pledged pursuant to this Agreement.

 

Party A agrees to take all necessary actions to maintain the validity and enforceability of the Pledged Shares, including but not limited to the payment of all fees and taxes associated with the ownership and maintenance of the Pledged Shares. The Exchange shall have the right to vote or cause to be voted any and all of the Pledged Shares at any meeting of stockholders or equity holders.

 

This pledge of the Pledged Shares shall remain in effect until the Pledged Shares are released or returned in accordance with Article 2.6 of this Agreement. Party A understands and acknowledges that any failure to fulfill its obligations under the Agreements shall constitute an event of default and the Exchange may exercise its rights under this pledge to liquidate the Pledged Shares to satisfy any such obligations.

 

This pledge shall also be binding upon any successor or assign of Party A and shall inure to the benefit of the Exchange's successors and assigns. Party A hereby authorizes the Exchange to file financing statements or other similar documents as may be necessary or advisable to perfect the Exchange's security interest in the Pledged Shares

 

2.2 The Pledged Shares shall be pledged to the Exchange upon the execution of this Agreement, and the pledging of the Pledged Shares shall not require any consent or authorization of the Pledged Company, or any other Person.

 

2.3 Party A hereby grants the Exchange a security interest in the Pledged Shares and all rights attached thereto as collateral to secure the full and timely performance of all of Party A’s obligations under the Membership Agreement, the Clearing Agreement and any other agreements between the Parties (the “Pledge Agreement” and the “Pledged Shares”, respectively).

 

Party A irrevocably authorizes the Exchange to take any and all actions necessary to perfect and maintain the perfection of the Pledge over the Pledged Shares, including but not limited to filing any UCC financing statement or other document, providing notice to the Pledged Company of the pledge, and executing and filing any document or notice that the Exchange may reasonably request from time to time, in each case without further consent from Party A.

 

The Pledged Shares shall be held by the Exchange as collateral until the Pledge is released in accordance with the terms of this Agreement. The Exchange shall have the right to sell or dispose of all or any part of the Pledged Shares in accordance with applicable law and this Agreement, without notice to or consent from Party A, in the event of a default by Party A.

 

Party A shall execute all documents and take any further action as may be necessary or desirable to perfect and maintain the Pledge and to protect the interests of the Exchange in the Pledged Shares, including without limitation the execution and delivery of any power of attorney or other document requested by the Exchange

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

 

PLEDGOR:

 

[PLEDGOR NAME]

 

By:_________________________

 

[AUTHORIZED SIGNATORY NAME AND TITLE]

 

PLEDGE HOLDER:

 

[PLEDGE HOLDER NAME]

 

By:_________________________

 

[AUTHORIZED SIGNATORY NAME AND TITLE]