PLEDGE AGREEMENT


 


THIS PLEDGE AGREEMENT
(this “Agreement”) dated as of this 21st day of December, 2012 (the “Effective Date”)
is made among Sino Gas International Holdings, Inc., a Utah corporation (the “Pledgor”) and Goldfield International
Investment Ltd., the holder of the Note (as defined herein) and listed as the Secured Party on the signature pages hereof (the
“Secured Party”).


 


WHEREAS, the Secured
Party has made a loan evidenced by an 8% Senior Secured Exchangeable Note (the “Note”) of Pledgor pursuant
to a Loan Agreement (the “Purchase Agreement” between the Secured Party and the Pledgor); and


 


WHEREAS, it is a condition
to the obligations of the Secured Party under the Purchase Agreement that the Pledgor pledge the Collateral and deliver this Pledge
Agreement; and


 


WHEREAS, Pledgor is
the sole shareholder of GAS Investment China Co., Ltd., a British Virgin Islands company (“GAS Investment”)
and has agreed to pledge the Collateral (as defined herein) as security for the full and punctual observance and performance of
the covenants and agreements contained herein and in the Purchase Agreement and in the Note.


 


NOW, THEREFORE, in consideration
of the premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, hereby agree as follows:


 



    	 



    	 



    

 


SECTION 1. Term;
Grant of Security Interests. 


 


(a)          The
term of this Agreement commenced on the Effective Date and shall terminate on the date the Note no longer remains due and outstanding.


 


(b)          In
order to secure the full and punctual observance and performance of the covenants and agreements contained herein and in the Purchase
Agreement and in the Note:


 


(i)          Pledgor
hereby assigns and pledges to the Secured Party, and grants to the Secured Party, security interests in and to, and a lien upon
and right of setoff against, and transfers to the Secured Party, as and by way of a security interest having priority over all
other security interests, with power of sale, all of its right, title and interest in and to the Collateral (as defined below).
The Secured Party shall have all of the rights, remedies and recourses with respect to the Collateral afforded a secured party
by the UCC, in addition to, and not in limitation of, the other rights, remedies and recourses afforded to the Secured Party by
this Agreement.


 


(ii)         On
or prior to the date of this Agreement, Pledgor shall deliver to the Collateral Agent in pledge hereunder an aggregate of 10,000,000
shares in Gas Investment, in the manner provided in Section 6(b) (the “Pledgor Shares”).


 


(iii)         If
Gas Investment at any time issues to Pledgor any shares then such shall constitute Collateral hereunder and shall include any
additional or substitute shares of stock of any class (or any security entitlements in respect thereof), and Pledgor shall immediately
pledge and deliver to the Secured Party in accordance with Section 6(b) all such shares and security entitlements as additional
Collateral hereunder.


 


(iv)         The
Security Interests are granted as security only and shall not subject the Secured Party to, or transfer or in any way affect or
modify, any obligation or liability of Pledgor with respect to any of the Collateral or any transaction in connection therewith.


 



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SECTION
2.  Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in
the Note or the Purchase Agreement. As used herein, the following words and phrases shall have the following meanings.


 


“Collateral”
means (i) the Pledged Items, including those described in Section 1(b); (ii) all additions to and substitutions for such
Pledged Items (including, without limitation, any securities or other property delivered or pledged pursuant to Section 1(b));
(iii) all income, proceeds and collections received or to be received, or derived or to be derived, now or any time hereafter
(whether before or after the commencement of any proceeding under applicable bankruptcy, insolvency or similar law, by or against
Pledgor, with respect to Pledgor) from or in connection with the Pledged Items (including, without limitation, any shares issued
by Gas Investment in respect of any shares constituting Collateral or any cash, securities or other property distributed in respect
of or exchanged for any shares constituting Collateral, or into which any such shares are converted, and any security entitlements
in respect of any of the foregoing); and (iv) all powers and rights now owned or hereafter acquired under or with respect to the
Pledged Items, as provided herein.


 


“Collateral
Event of Default” means, at any time, the occurrence of either of the following: (A) failure to deliver any additional
Collateral pursuant to Section 1(c) or (B) failure at any time of the Security Interests to constitute valid and perfected
security interests in all of the Collateral, subject to no Lien, or assertion of such by Pledgor or Gas Investment in writing
in each case for a period of more than five (5) Business Days following notice thereof to the Pledgor.


 


“Event of
Default” has the meaning provided in the Purchase Agreement.


 


“Location”
means, with respect to any party, the place such party is “deemed located” within the meaning of Section 9-307(b)(1)
of the UCC.


 


“Note”
has the meaning provided in the preamble hereto.


 


“Person”
means an individual, a corporation, a partnership, an association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.


 


“Pledged
Items” means, as of any date, any and all shares in Gas Investment and other items delivered to the Secured Party pursuant
to Sections 1(b) be held by the Secured Party under this Agreement.


 


“Pledgor”
has the meaning provided in the preamble hereto.


 


“Pledgor
Shares” means, as of the date hereof, an aggregate of 10,000,000 shares owned by the Pledgor.


 


“Secured
Party” has the meaning provided in the preamble hereto.


 


“Security
Interests” means the security interests in the Collateral created hereby.


 



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“Shares”
means the shares, par value 1-00 per share, of GAS Investment China Co., Ltd., a wholly owned subsidiary of Pledgor.


 


“UCC”
means the Uniform Commercial Code as in effect in the State of New York.


 



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SECTION 3. Representations
and Warranties of Pledgor. On the date hereof and continuing at all times until termination of this Agreement (including
on each date on which additional Collateral is pledged hereunder), Pledgor hereby represents and warrants to the Secured
Party that:


 


(a)(i) Pledgor
acquired and made full payment for all Shares pledged hereunder (or in respect of which security entitlements are pledged hereunder)
and owns and, at all times prior to the release of the Collateral pursuant to the terms of this Agreement, will own the Collateral
free and clear of any Liens (other than the Security Interests); and (ii) Pledgor is not and will not become a party to or
otherwise be bound by any agreement, other than this Agreement, that (x) restricts in any manner the rights of any present or
future owner of the Collateral with respect thereto or (y) provides any person other than the Pledgor, the Secured Party or any
securities intermediary through whom any Collateral is held (but, in the case of any such securities intermediary, only with respect
of Collateral held through it) with control (as defined in Section 8-106 of the UCC) with respect to any Collateral;


 


(b)other than
financing statements or other similar or equivalent documents or instruments with respect to the Security Interests, no financing
statement, security agreement or similar or equivalent document or instrument covering all or any part of the Collateral is on
file or of record in any jurisdiction in which such filing or recording would be effective to perfect a lien, security interest
or other encumbrance of any kind on such Collateral;


 


(c)all Shares
at any time pledged hereunder (or in respect of which security entitlements are pledged hereunder) are and will be (i) certificated
(and the certificate or certificates in respect of such Shares are and will be located in the United States) and registered in
the name of Pledgor or held through a securities intermediary whose securities intermediary’s jurisdiction (within the meaning
of Section 8-110(e) of the UCC) is located in the United States (other than in South Carolina or Rhode Island) or (ii) uncertificated
and either registered in the name of Pledgor or held through a securities intermediary whose securities intermediary’s jurisdiction
(within the meaning of Section 8-110(e) of the UCC) is located in the United States (other than in South Carolina or Rhode
Island), and, in any event subject to the control (as defined in the UCC) of the Secured Party;


 


(d)upon (i) the
delivery of certificates evidencing any Shares to the Secured Party in accordance with Section 6(b)(A) or the registration of
uncertificated Shares in the name of the Secured Party or its nominee in accordance with Section 6(b)(B), the Secured Party, a
valid and, as long as the Secured Party retains possession of such certificates or such uncertificated Shares remains so registered,
perfected security interest therein, in respect of which the Secured Party will have control, subject to no other Lien and (ii)
the crediting of any Shares to a segregated account of the Secured Party in accordance with Section 6(b)(C), the Secured Party
will have, a valid and, so long as such Shares continue to be credited to the account of the Secured Party, perfected security
interest in a security entitlement in respect thereof, in respect of which the Secured Party will have control, subject to no
other Lien;


 



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(e)no registration,
recordation or filing with any Person is required in connection with the execution and delivery of this Agreement or necessary
for the validity or enforceability hereof or for the perfection or enforcement of the Security Interests;


 


(f)the execution,
delivery and performance by the Pledgor of this Agreement have been duly authorized by all necessary action on the part of the
Pledgor and do not and will not violate, contravene or constitute a default under any provision of applicable law or regulation
or of the constitutive documents of the Pledgor or of any material agreement, judgment, injunction, order, decree or other instrument
binding upon the Pledgor;


 


(g)this Agreement
constitutes a valid and legally binding agreement of the Pledgor enforceable against the Pledgor in accordance with its terms;


 


(h)Pledgor has
not performed and will not perform any acts that might prevent the Collateral Agent from enforcing any of the terms of this Agreement
or that might limit the Collateral Agent in any such enforcement; and


 


(i)the Location
of Pledgor is the address set forth in Section 10(c).


 



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SECTION 4. Certain
Covenants of Pledgor.


 


Pledgor agrees that,
so long as any of the Pledgor’s obligations under the Note remains outstanding:


 


(a)Pledgor shall
ensure at all times that a Collateral Event of Default shall not occur, and shall pledge additional Collateral in the manner described
in Section 1(c) as necessary to cause such requirement to be met;


 


(b)Pledgor shall,
at the expense of Pledgor and in such manner and form as the Secured Party may require, give, execute, deliver, file and record
any financing statement, notice, instrument, document, agreement or other papers that may be necessary or desirable in order to
create, preserve, perfect, substantiate or validate any security interest granted (on a first priority basis) pursuant hereto
or to enable the Secured Party to exercise and enforce its rights and the rights hereunder with respect to such security interest
and to the extent permitted by applicable law, Pledgor hereby authorizes the Secured Party to execute and file, in the name of
Pledgor or otherwise, UCC financing or continuation statements (which may be carbon, photographic, photostatic or other reproductions
of this Agreement or of a financing statement relating to this Agreement) that the Secured Party in its sole discretion may deem
necessary or appropriate to further perfect, or maintain the perfection of, the Security Interests;


 


(c)Pledgor shall
warrant and defend its title to the Collateral, subject to the rights of the Secured Party, against the claims and demands of
all persons and the Secured Party may elect, but without an obligation to do so, to discharge any Lien of any third party on any
of the Collateral;


 


(d)Pledgor agrees
that it shall not change (1) its name or identity in any manner or (2) its Location, unless in either case (A) it shall have given
the Secured Party not less than fifteen (15) days’ prior notice thereof and (B) such change shall not cause any of the Security
Interests to become unperfected or subject any Collateral to any other Lien; and


 


(e)Pledgor agrees
that so long as the Note are outstanding it shall not (1) create or permit to exist any Lien (other than the Security Interests)
upon or with respect to the Collateral, (2) sell or otherwise dispose of, or grant any option with respect to, any of the Collateral
or (3) enter into or consent to any agreement pursuant to which any person other than the Pledgor, the Secured Party and any securities
intermediary through whom any of the Collateral is held (but in the case of any such securities intermediary only in respect of
Collateral held through it) has or will have control (within the meaning of Section 8-106 or 9-104 of the UCC) in respect of any
Collateral.


 



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SECTION 5.
Administration of the Collateral and Delivery of Additional Collateral.


 


(a)If any additional
Collateral is required to be delivered pursuant to Section 1(b), Pledgor shall deliver such additional Collateral to the
Secured Party within two (2) Business Days of receipt by the Pledgor. Concurrently with the delivery of any additional Collateral,
Pledgor shall deliver to the Secured Party a certificate of Pledgor substantially in the form of Exhibit A hereto and dated the
date of such delivery, (A) identifying the additional items of Collateral being pledged and (B) certifying that with respect
to such items of additional Collateral the representations and warranties contained in Section 3 are true and correct with respect
to such Collateral and otherwise on and as of the date thereof.


 


(b)Any delivery
of Shares as Collateral to the Secured Party by Pledgor shall be effected (A) in the case of Collateral consisting of certificated
Shares registered in the name of Pledgor, by delivery of certificates representing such Shares to the Secured Party, accompanied
by any required transfer tax stamps, and indorsed and otherwise in suitable form for transfer by delivery or accompanied by duly
executed instruments of transfer or assignment in blank, with signatures appropriately guaranteed, all in form and substance satisfactory
to the Secured Party, (B) in the case of Collateral consisting of uncertificated Shares registered in the name of Pledgor, by
transmission by Pledgor of an instruction to the issuer of such Shares instructing such issuer to register such Shares in the
name of the Secured Party or its nominee, accompanied by any required transfer tax stamps, and the issuer’s compliance with
such instructions or (C) in the case of Shares in respect of which security entitlements are held by Pledgor, by the crediting
of such Shares, accompanied by any required transfer tax stamps, to a segregated account of the Secured Party. Upon delivery of
any such Pledged Item under this Agreement, the Secured Party shall examine such Pledged Item and any certificates delivered pursuant
to Section 6(a) or otherwise pursuant to the terms hereof in connection therewith to confirm that they comply as to form with
the requirements for Collateral.


 


(c)If on any Business
Day the Secured Party determines that a Collateral Event of Default shall have occurred, the Collateral Agent shall promptly notify
Pledgor of such determination by telephone call to Pledgor followed by a written confirmation of such call.


 


(d)In the event
of an Event of Default, the Secured Party may cause any or all of the Shares pledged hereunder registered in the name of Pledgor
or its nominee to be transferred of record into the name of the Secured Party or its nominee. Pledgor shall promptly give to the
Secured Party copies of any notices or other communications received by Pledgor with respect to Shares pledged hereunder registered,
or held through a securities intermediary, in the name of Pledgor or its nominee.


 



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(e)Pledgor agrees
that it shall forthwith upon demand pay to the Secured Party:


 


(i)          amount
of any taxes that the Secured Party may have been required to pay by reason of the Security Interests or to free any of the Collateral
from any Lien thereon; and


 


(ii)         the
amount of any and all out-of-pocket expenses, including the fees and disbursements of counsel and of any other experts, that the
Secured Party may incur in connection with (A) the enforcement of this Agreement or the Note, including such expenses as are incurred
to preserve the value of the Collateral and the validity, perfection, rank and value of the Security Interests, (B) the collection,
sale or other disposition of any of the Collateral, (C) the exercise by the Collateral Agent of any of the rights conferred upon
it hereunder or (D) any Event of Default.


 


Any such amount not
paid on demand shall bear interest (computed on the basis of a year of 360 days and payable for the actual number of days elapsed)
at a rate per annum equal to 5% plus the rate reported by Bloomberg Financial L.P. as the prime rate.


 



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SECTION 6.
Income and Voting Rights in Collateral.


 


(a)The Secured
Party shall have the right to receive and retain all proceeds of the Collateral and Pledgor shall take all such action as the
Secured Party shall deem necessary or appropriate to give effect to such right. All such proceeds, including, without limitation,
all dividends and other payments and distributions that are received by Pledgor, shall be received in trust for the benefit of
the Secured Party and, if the Secured Party so directs shall be segregated from other funds of Pledgor and shall, forthwith upon
demand by the Secured Party be paid over to the Secured Party as Collateral in the same form as received (with any necessary endorsement).


 


(b)Unless an Event
of Default shall have occurred, Pledgor shall have the right, from time to time, to vote and to give consents, ratifications and
waivers with respect to the Collateral, and the Secured Party shall, upon receiving a written request from Pledgor, accompanied
by a certificate of the Pledgor stating that no Event of Default has occurred and is continuing, deliver to Pledgor, or as specified
in such request, such proxies, powers of attorney, consents, ratifications and waivers in respect of any of the Collateral that
is registered, or held through a securities intermediary, in the name of the Secured Party or its nominee, as shall be specified
in such request, and shall be in form and substance satisfactory to the Secured Party.


 


(c)If an Event
of Default shall have occurred, the Secured Party shall have the right, to the extent permitted by law, and Pledgor shall take
all such action as may be necessary or appropriate to give effect to such right, to vote and to give consents, ratifications and
waivers, and to take any other action with respect to any or all of the Collateral with the same force and effect as if the Secured
Party were the absolute and sole owner thereof.


 



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SECTION 7. Remedies
upon Events of Default.


 


(a)If any Event
of Default shall have occurred, the Secured Party shall have all the rights of a secured party under the Uniform Commercial Code
(whether or not in effect in the jurisdiction where such rights are exercised) and, in addition, without being required to give
any notice, except as herein provided or as may be required by mandatory provisions of law, shall, at the direction of the Secured
Party, sell all of the Collateral, or such lesser portion thereof as may be necessary to generate proceeds sufficient to satisfy
in full all of the obligations of the Pledgor under the Note or hereunder, at public or private sale or at any broker’s
board or on any securities exchange, for cash, upon credit or for future delivery, and at such price or prices as the Secured
Party may deem commercially reasonable. Pledgor covenants and agrees that it will execute and deliver such documents and take
such other action as the Secured Party deems necessary or advisable in order that any such sale may be made in compliance with
law. Upon any such sale, the Secured Party shall have the right to deliver, assign and transfer to the buyer thereof the Collateral
so sold. Each buyer at any such sale shall acquire the Collateral so sold absolutely and free from any claim or right of whatsoever
kind, including any equity or right of redemption of Pledgor that may be waived or any other right or claim of Pledgor. The notice
(if any) of such sale required by Section 9-613 of the UCC shall (1) in case of a public sale, state the time and place fixed
for such sale, (2) in case of sale at a broker’s board or on a securities exchange, state the board or exchange at which
such sale is to be made and the day on which the Collateral, or the portion thereof so being sold, will first be offered for sale
at such board or exchange, and (3) in the case of a private sale, state the day after which such sale may be consummated. Any
such public sale shall be held at such time or times within ordinary business hours and at such place or places as the Secured
Party may fix in the notice of such sale. At any such sale the Collateral may be sold in one lot as an entirety or in separate
parcels, as the Secured Party may determine. The Secured Party shall not be obligated to make any such sale pursuant to any such
notice. The Secured Party may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned
from time to time by announcement at the time and place fixed for the sale, and such sale may be made at any time or place to
which the same may be so adjourned. In case of any sale of all or any part of the Collateral on credit or for future delivery,
the Collateral so sold may be retained by the Secured Party until the selling price is paid by the buyer thereof, but the Secured
Party shall not incur any liability in case of the failure of such buyer to take up and pay for the Collateral so sold and, in
case of any such failure, such Collateral may again be sold upon like notice. The Secured Party, instead of exercising the power
of sale herein conferred upon it, may proceed by a suit or suits at law or in equity to foreclose the Security Interests and sell
the Collateral, or any portion thereof, under a judgment or decree of a court or courts of competent jurisdiction. The Secured
Party or any of its respective affiliates may be the purchaser, licensee, assignee or recipient of the Collateral or any part
thereof at any such sale and shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price
for all or any portion of the Collateral sold, assigned or licensed at such sale, to use and apply any of the obligations secured
hereunder owed to such Person as a credit on account of the purchase price of the Collateral or any part thereof payable by such
Person at such sale.


 



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(b)The Pledgor
recognizes that, by reason of certain prohibitions contained in the Securities Act of 1933, as amended (the “Securities
Act”), and applicable state securities laws or other prohibitions contained in laws, rules and regulations of governmental
authorities, the Secured Party may be compelled, with respect to any sale of all or any part of the Collateral, to limit purchasers
to those who will certify, among other things, that they are acquiring the Collateral for their own account, for investment and
not with a view to the distribution or resale thereof or that otherwise satisfy the requirements of such governmental authorities.
The Pledgor acknowledges that any such private sales may be at prices and on terms less favorable to the Secured Party that those
obtainable through a public sale without such restrictions (including, without limitation, a public offering made pursuant to
a registration statement under the Securities Act), and, notwithstanding such circumstances, agrees that any private sale shall
be deemed to have been made in a commercially reasonable manner and that the Secured Party shall have no obligation to engage
in public sales and no obligation to delay the sale of any Collateral for the period of time necessary to permit the issuer thereof
to register it for a form of public sale requiring registration under the Securities Act or under applicable state securities
laws, even if the Pledgor or the issuer, as the case may be, would agree to do so. If the Secured Party determines to exercise
its right to sell any or all of the Collateral, upon written request, Pledgor shall from time to time furnish to the Secured Party
all such information as the Secured Party may request in order to determine the number of securities included in the Collateral
which may be sold by the Secured Party as exempt transactions under the Securities Act and the rules of the Securities and Exchange
Commission thereunder, as the same are from time to time in effect.


 


(c)Pledgor hereby
irrevocably appoints the Secured Party its true and lawful attorney, with full power of substitution, in the name of Pledgor,
the Secured Party or otherwise, for the sole use and benefit of the Secured Party, but at the expense of Pledgor, to the extent
permitted by law, to exercise, at any time and from time to time while an Event of Default has occurred and is continuing, all
or any of the following powers to be performed at the sole direction of the Secured Party holding a majority of the outstanding
principal amount of the Note with respect to all or any of the Collateral:


 


(i)          to
demand, sue for, collect, receive and give acquittance for any and all monies due or to become due upon or by virtue thereof;


 


(ii)         to
settle, compromise, compound, prosecute or defend any action or proceeding with respect thereto;


 


(iii)        to
sell, transfer, assign or otherwise deal in or with the same or the proceeds or avails thereof, as fully and effectually as if
the Secured Party were the absolute owner thereof (including, without limitation, the giving of instructions and entitlement orders
in respect thereof);


 


(iv)          withdraw
all moneys, instruments, securities and other property in any bank, financial securities account, deposit or other account of
the Pledgor constituting Collateral for application to the obligations secured by this Agreement;


 






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(v)          retain
and apply any distributions on the Collateral to the obligations secured by this Agreement; and


 


(vi)          exercise
any and all rights as beneficial and legal owner of the Collateral, including perfecting assignment of and exercising any and
all voting, consensual and other rights and powers with respect to the Collateral.


 


provided that the Secured Party
shall give Pledgor at least ten (10) days’ prior written notice of the time and place of any sale or other intended disposition
of any of the Collateral, except any Collateral that threatens to decline speedily in value, including, without limitation, equity
securities, or is of a type customarily sold on a recognized market. The Secured Party and Pledgor agree that such notice constitutes
“reasonable notification” within the meaning of Section 9-612 of the UCC.


 


(d)Upon any delivery
or sale of all or any part of any Collateral made either under the power of delivery or sale given hereunder or under judgment
or decree in any judicial proceedings for foreclosure or otherwise for the enforcement of this Agreement, the Secured Party is
hereby irrevocably appointed the true and lawful attorney of Pledgor, in the name and stead of Pledgor, to make all necessary
deeds, bills of sale, instruments of assignment, transfer or conveyance of the property, and all instructions and entitlement
orders in respect of the property thus delivered or sold and to exercise any and all rights as beneficial and legal owner of the
Collateral, including perfecting assignment of and exercising any and all voting, consensual and other rights and powers with
respect to the Collateral. For that purpose the Secured Party may execute all such documents, instruments, instructions and entitlement
orders. This power of attorney shall be deemed coupled with an interest, and Pledgor hereby ratifies and confirms that which its
attorney acting under such power, or such attorney’s successors or agents, shall lawfully do by virtue of this Agreement.
If so requested by the Secured Party or by any buyer of the Collateral or a portion thereof, Pledgor shall further ratify and
confirm any such delivery or sale by executing and delivering to the Secured Party or to such buyer or buyers at the expense of
Pledgor all proper deeds, bills of sale, instruments of assignment, conveyance or transfer, releases, instructions and entitlement
orders as may be designated in any such request.


 


(e)In the case
of an Event of Default, the Secured Party may proceed to realize upon the security interest in the Collateral against any one
or more of the types of Collateral, at any time, as the Secured Party shall determine in its sole discretion subject to the foregoing
provisions of this Section 8. The proceeds of any sale of, or other realization upon, or other receipt from, any of the Collateral
shall be applied by the Secured Party in the following order of priorities:


 


first, to the
payment to the Secured Party of the expenses of such sale or other realization, the Secured Party and its agents and counsel,
and all expenses, liabilities and advances incurred or made by the Secured Party in connection therewith, including brokerage
fees in connection with the sale by the Secured Party of any Collateral;


 



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second, to
the payment to the Secured Party, ratably, of all of the Pledgor’s obligations under the Note; and


 


finally, if
all of the obligations of Pledgor hereunder and of the Pledgor under the Note have been fully discharged or sufficient funds have
been set aside by the Collateral Agent at the request of Pledgor for the discharge thereof, any remaining proceeds shall be released
to Pledgor.


 



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SECTION 8. Miscellaneous.
(a)This Agreement is not intended and shall not be construed to create any rights in any person other than the Secured
Party and their respective successors and assigns and no other person shall assert any rights as third party beneficiary
hereunder. Whenever any of the parties hereto is referred to, such reference shall be deemed to include the successors and
assigns of such party. All the covenants and agreements herein contained by or on behalf of Pledgor shall bind, and inure to
the benefit of, its successors and assigns whether so expressed or not, and shall be enforceable by and inure to the benefit
of the Secured Party and its respective successors and assigns. Without limiting the generality of the foregoing, the Secured
Party may assign or otherwise transfer any indebtedness held by it secured by this Agreement to any other Person, and such
other Person shall thereupon become vested with all the benefits in respect thereof granted to the Secured Party, herein or
otherwise. The Pledgor may not assign its rights or obligations under this Agreement without the prior written consent of
Secured Party.


 


(b)To the extent
permitted by law, the unenforceability or invalidity of any provision or provisions of this Agreement shall not render any other
provision or provisions herein contained unenforceable or invalid so long as this Agreement as so modified continues to express,
without material change, the original intentions of the parties as to the subject matter of this Agreement and the deletion of
such portion of this Agreement will not substantially impair the respective benefits or expectations of the parties hereto.


 


(c)Any provision
of this Agreement may be amended or waived if, and only if, such amendment or waiver is in writing and signed, in the case of
an amendment, by Pledgor, and the Secured Party or, in the case of a waiver, by the party against whom the waiver is to be effective.
No failure or delay by either party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right,
power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided
by law.


 


(d)All notices
and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by
any standard forms of telecommunication. Notices shall be directed as follows:


 


If to the Pledgor:


 


Sino Gas International Holdings,
Inc.


No.18 Zhong Guan Cun Dong St.


Haidian District


Beijing, P.R. China


Attention: Yuchuan Liu, Chairman
and CEO


 



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With a copy to:


 


Jiannan Zhang


Cadwalader, Wickersham & Taft
LLP


2301 China Central Place Tower
2


No. 79 Jianguo Road, Beijing 100025,
China


Fax: (86-10) 6599-7300


 


to the Secured Party
at its addresses for notices set forth in the Purchase Agreement.


 


(e)This Agreement
shall in all respects be construed in accordance with and governed by the laws of the State of New York; provided that as to Pledged
Items located in any jurisdiction other than the State of New York, the Secured Party shall, in addition to any rights under the
laws of the State of New York, have all of the rights to which a secured party is entitled under the laws of such other jurisdiction.


 


(f)Each party
hereby irrevocably and unconditionally submits, to the fullest extent permitted by applicable law, to the non-exclusive jurisdiction
of the Federal and state courts located 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.


 


(g)Each party
hereby irrevocably and unconditionally waives, to the fullest extent permitted by applicable law, any and all right to trial by
jury in any legal proceeding arising out of or related to this Agreement or the transactions contemplated hereby. Each party (i)
certifies that no representative, agent or attorney of the other party has represented, expressly or otherwise, that such other
party would not seek to enforce the foregoing waiver in the event of any such suit, action or proceeding and (ii) acknowledges
that it and the other parties have entered into this Agreement and acquired the Note, as applicable, in reliance on, among other
things, the mutual waivers and certifications in this Section.


 


(h)This Agreement
may be executed, acknowledged and delivered in any number of counterparts and all such counterparts taken together shall be deemed
to constitute one and the same agreement.


 


(i)This Agreement
constitutes the entire agreement and understanding among the parties with respect to its subject matter hereof and supersedes
all oral communications and prior writings with respect thereto.


 



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SECTION 9.
Termination of Pledge Agreement. This Agreement and the rights hereby granted by Pledgor in the Collateral shall cease,
terminate and be void upon fulfillment of all of the obligations of Pledgor hereunder and of the Pledgor under the Note and Purchase
Agreement. Any Collateral remaining at the time of such termination shall be fully released and discharged from the Security Interests
and delivered to Pledgor by the Secured Party, all at the request and expense of Pledgor. Notwithstanding the foregoing, Pledgor
agrees that its obligations hereunder and the security interest created hereunder shall continue to be effective or be reinstated,
as applicable, if at any time payment, or any part thereof, of all or any part of the obligations secured hereby is rescinded
or must otherwise be restored by the Secured Party upon the bankruptcy or reorganization of Pledgor or otherwise.


 



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


 


	PLEDGOR: 	Amount of 100% shares of 
	 	the Gas Investment:


 


	By:	/s/ Yuchuan Liu	 





	Name:	Yuchuan Liu	 
	Title:	Chief Executive Officer	 


 


SECURED PARTY:


 


	By:	/s/ Authorized Signatory	 





	Name:	Authorized Signatory	 
	Title:	Authorized Signatory	 


 


Signature
Page To Pledge Agreement


 



    	 



    	 



    

 


Exhibit A


to


Pledge Agreement


 


CERTIFICATE FOR
ADDITIONAL COLLATERAL





 


The undersigned, _______________
(“Pledgor”), hereby certifies, pursuant to Section 6(b) of the Pledge Agreement, dated as of December __, 2012,
among Pledgor, _________________, and the Secured Party named therein (the “Pledge Agreement”; terms defined
in the Pledge Agreement being used herein as defined therein), that:


 


1.Pledgor is
delivering, or causing to be delivered, in accordance with Section 1(c) of the Pledge Agreement, the following securities to the
Collateral Agent to be held by the Collateral Agent as additional Collateral (the “Additional Collateral”);


 


______________________________


______________________________


______________________________


 


2.Pledgor hereby
represents and warrants to the Secured Party that the representations and warranties contained in paragraphs (a), (b), (c), (d)
and (e) of Section 3 of the Pledge Agreement are true and correct with respect to the Additional Collateral on and as of
the date hereof.


 


This Certificate may
be relied upon by the Secured Party as fully and to the same extent as if this Certificate had been specifically addressed to
the Secured Party.


 


[SIGNATURE PAGE TO
FOLLOW]


 



    	 



    	 



    

 


IN WITNESS WHEREOF,
the undersigned has executed this Certificate this __ day of _____________, ____.


 


	 	 
	[Name]