Blueprint





 


 





 


 

 



SHARE PLEDGE AGREEMENT

 


THIS SHARE PLEDGE
AGREEMENT dated as of the 16th
day of Oct, 2017 .

 


 



BETWEEN:


 


JERRY KROLL,
an individual with an address at 102 E
1st Ave,

 


Vancouver, British Columbia V5T I A4 (the
"Pledgor")



AND:

 


 



CHONGQING ZONGSHEN AUTOMOBILE INDUSTRY CO.,

 


LTD., a company validly existing under the laws of the
People's Republic of China, having an office at Zongshen Industrial
Zone,

 


Chaoyouchang, Banan District, Chongqing, China
(the "Zongshen")


 

 


 



WHEREAS:

 


 

 

A. Zongshen
and ElectraMeccanica Vehicles Corp., a company incorporated under
the laws of the Province of British Columbia ("EMV"), entered into a memorandum of understanding dated
the 18th
day of September, 2017 (the
"MOU"); and

 


 

B. Pursuant
to the MOU, the Pledgor has agreed to pledge the Pledged EMV Shares
(as hereinafter defined) to and in favour of Zongshen.

 


 

 

C. Zongshen
(Canada) Environtech Ltd. ("Environtech"), a
Canadian affiliate of Zongshen, has agreed to accept the pledge of
Pledged EMV Shares for and on behalf of the Zongshen, and otherwise
act on behalf of Zongshen under this Agreement;

 


 


NOW THEREFORE
for good and valuable consideration
(the receipt and sufficiency of which are hereby acknowledged) the
Pledgor and Zongshen agree as follows:

 


 

 



ARTICLE 1 INTERPRETATION

 


 


1.1 Defined Terms.
As used in this agreement, the
following words and phrases have the following
meanings:

 


 




(a)

"Agreement" means this share pledge agreement and all
schedules hereto, as amended, supplemented, extended, renewed,
restated, replaced or superseded from time to
time.





 


 




(b)

"Business Day"
means a day that is not a Saturday,
Sunday or civic or statutory holiday in Vancouver, British
Columbia.





 


 




(c)

"Collateral"
means all of the Pledged EMV Shares,
substitutions therefor and proceeds of disposition thereof and all
other property that may at any time be received by or
otherwise






 

 


 


distributed
to or acquired by the Pledgor in any manner in respect of, or in
substitution for, or in addition to, or in exchange for, or on
account of, any of the foregoing, including without limitation, any
shares or other securities resulting from the subdivision,
consolidation, change, conversion or reclassification of any of the
foregoing.


 


1



 


 




 








 






 




(d)

"Default Notice"
has the meaning ascribed in Section
3.2 hereunder.





 


 

 




(e)

"Event of Default"
has the meaning ascribed in Section
3.2 hereunder.





 


 


(t) "Obligations"
means the obligations of EMV to
Zongshen, arising under or pursuant to the MOU.

 


 




(g)

"Pledged EMV Shares"
means the number of shares issued and
outstanding in the authorized share structure of EMV that are
registered in the name of and beneficially held by the Pledgor, as
set out opposite the name of the Pledgor in Schedule "A" attached
hereto.





 


 




(h)

"Security Discharge
Date" means the time at which
Zongshen tenders receipt of payment by EMV for the prototype mold
at the end of the 6 month period, as contemplated by the
MOU.





 


 




(i)

"Security Interest"
has the meaning ascribed in Section
2.1 hereunder.





 


 

 


1.2 Other Usages.
References to "this agreement", "the
agreement", "hereof', "herein", and like references refer to this
Share Pledge Agreement and not to any particular Article, section
or other subdivision of this agreement.

 


 


1.3 Plural and Singular.
Where the context so requires, words
importing the singular number shall include the plural and vice
versa.

 


 


1.4 Headings. The insertion of headings in this agreement is for
convenience of reference only and shall not affect the construction
or interpretation of this agreement.

 


 

 


1.5 Applicable Law.
This agreement and all documents
delivered pursuant hereto shall be deemed to be governed by and
construed in accordance with the laws of the Province of British
Columbia, Canada.


 


1.6 Time of the Essence.
Time shall in all respects be of the
essence of this agreement, and no extension or variation of this
agreement or any obligation hereunder shall operate as a waiver of
this provision.

 


 

 



ARTICLE2 PLEDGE OF
COLLATERAL


 


2.1 Pledge of Collateral.
As continuing security for the
performance by EMV of the Obligations, the Pledgor hereby grants a
security interest in and pledges the Collateral to and in favour of
Zongshen (the said security interest and pledge of the Collateral
being hereinafter referred to as the "Security
Interest").

 


 

 

2.2 Distributions.
All interest, cash dividends, income
and revenue from Pledged EMV Shares shall be collected by and
payable to the Pledgor (and not Zongshen) and shall not form part
of the Collateral.

 


 

2.3 Voting Rights.
Unless and until an Event of Default
has occurred and is continuing, the Pledgor shall be entitled to
vote the Pledged EMV Shares and to give consents, waivers, notices
and ratifications, and to take
other action in respect of the Pledged EMV Shares, provided
however, that the Pledgor will not vote or give any consent,
waiver, notice or ratification or take any action which would be
prejudicial to the interests of Zongshen, impair, reduce the value
of or restrict the transferability of the Collateral or be
inconsistent with or violate any provision of this Agreement, the
MOU or any other agreement relating hereto or
thereto.

 


 

2.4 Attachment
of Security Interest. The
parties hereby acknowledge their mutual intention that the Security
Interest is to attach, for the purposes of the Act, at the earliest
time permissible under the laws governing this Agreement and that
value has been given and that the Pledgor has rights in the
Collateral existing on the date hereof.


 


 



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ARTICLE3

 



DEFAULT AND ENFORCEMENT

 


 

3.1 Default.
The Pledgor shall be in default under
this Agreement if EMV fails to satisfy the Obligations pursuant to
the terms of the MOU.

 


 


3.2 Default Notice.
In the event of any default as set out
in Section 3.1, Zongshen shall provide written notice of the same
to the Pledgor (the "Default Notice").
In the event that the event of default
has not been remedied within three (3) Business Days of its receipt
of the Default Notice (an "Event of Defau
lt"):

 


 

 




(a)

Zongshen
shall be entitled to take all steps as are reasonably necessary in
order to have the Pledged EMV Shares registered in the name
ofZongshen in the books and records of EMV;





 


 




(b)

Zongshen may exercise in respect of the Collateral
all the rights and remedies of a secured party on default under
the Personal Property Security
Act (British
Columbia);





 


 




(c)

the
Security Interest shall immediately become enforceable and Zongshen
or its nominee may realize on any or all of the Collateral and
sell, lease, assign, give options to purchase, or otherwise dispose
of and deliver any or all of the Collateral (or contract to do any
of the above), in one or more parcels at any public or private sale
or elsewhere, with or without advertising or other formality,
except as required by applicable law, on such terms and conditions
as Zongshen may deem advisable and at such prices as it may deem
best, for cash or on credit or for future delivery;





 


 




(d)

Zongshen
may vote any or all of the Pledged EMV Shares (whether or not
transferred to Zongshen or its nominee) and give or withhold all
consents, waivers and ratifications with respect thereto and
otherwise act with respect thereto as though it were the outright
owner thereof; and





 


 




(e)

Zongshen
may exercise any and all rights, privileges, entitlements and
options pertaining to any of the Collateral as if Zongshen were the
absolute owner of such Collateral.






 

 

3.3 Zongshen
may waive any breach by the Pledgor of any of the provisions
contained in this Agreement or any default by the Pledgor in the
observance or the performance of any term or condition of this
Agreement, provided always that no act or omission of Zongshen
shall extend to or be taken in any manner whatsoever to affect any
subsequent breach or default of the Pledgor or the rights resulting
therefrom.

 


 

3.4 The
parties hereto shall sign such further and other papers, cause such
meetings to be held, resolutions passed, exercise their vote and
influence, do and perform and cause to be done and performed
such further and other acts and things
as may be necessary or desirable in order to give effect to this
Agreement.


 

3.5 The
rights of Zongshen under this Agreement are cumulative and not
exclusive of any right or remedy which Zongshen would otherwise
have.

 


 

 



ARTICLE 4

 



REPRESENTATIONS, WARRANTIES AND COVENANTS

 


 

4.1 Representations
and Warranties of the Pledgor. The Pledgor represents and warrants to and in
favour of Zongshen as of the date hereof, that:

 


 




(a)

the
Pledgor has not entered into any agreement with or granted to any
person, firm or corporation any option or any right or privilege
capable of becoming an agreement or option to acquire any right or
interest in any of the Collateral (other than as created by this
Agreement);





 


 




(b)

the
Pledgor is the legal and beneficial owner of the Collateral free
and clear of all liens, charges, pledges, restrictions (other than
restrictions arising under any applicable securities laws) and
encumbrances (other than as created by this
Agreement);






 


 

3





 




 








 






 




(c)

the
Pledgor has the full right and legal capacity to enter into this
Agreement and to grant to Zongshen the Security Interest in the
Collateral;





 


 




(d)

this
Agreement has been duly executed and delivered by the Pledgor and
constitutes a legal, valid and binding obligation of the Pledgor
enforceable by Zongshen against the Pledgor in accordance with its
terms, except as enforceability may be limited by applicable
bankruptcy laws and general principles of equity;





 


 




(e)

the
execution and delivery by the Pledgor of this Agreement, and the
performance of his obligations under this Agreement, do not and
will not breach or result in a default under any contract or
covenant by which he is bound;





 


 




(f)

the
pledge, assignment and delivery of the Collateral pursuant to this
Agreement creates a valid, perfected, first pledge of and a
perfected security interest in such Collateral, subject to no prior
pledge, lien, mortgage, hypothecation, security interest, charge,
option or encumbrance; and





 


 

 




(g)

the
Pledged EMV Shares pledged by the Pledgor to Zongshen hereunder
have been validly issued, are fully paid and
non-assessable.






 


All
of the foregoing representations and warranties made herein shall
survive the execution and delivery of this Agreement and shall be
deemed to be continuously made hereunder so long as any of the
Obligations remain outstanding.

 


 

4.2 Covenants
of the Pledgor. The Pledgor
hereby covenants and agrees with Zongshen, as soon as practicable
following receipt thereof, to deliver to Zongshen or Zongshen's
nominee, all certificates representing any shares or other
securities issued to Zongshen in substitution for the Pledged EMV
Shares or any other Collateral, and any shares or securities in
addition to those delivered upon the execution hereof, in each
case, duly endorsed in blank for transfer or accompanied by any and
all powers of attorney or instruments necessary to permit transfer
thereof. The Pledgor will not sell, assign, transfer, pledge or
encumber in any other manner the Collateral except in favour of
Zongshen.


 

 


 

4.3 Covenants
of Pledgor. The Pledgor hereby
covenants and agrees with Zongshen that it shall, from time to time
at its own expense, take such further action as Zongshen may
reasonably request for the purpose of obtaining or preserving the
full benefits of, and the rights and powers granted by, this
agreement, and agrees to sign and deliver, or cause to be signed
and delivered, to Zongshen all such further and other deeds,
documents, certificates, agreements and written instruments and to
take all such further action as may, in the reasonable opinion of
Zongshen, be reasonably necessary for the purpose of better
assuring to Zongshen, perfecting or enforcing the security
constituted hereby.

 


 

 



ARTICLE 5 RELEASE OF
COLLATERAL

 


 

5.1 Release
of Collateral. Upon the
Security Discharge Date and without the need for any direction or
action on the part of the Pledgor, Zongshen shall, as soon as
practicable, release and return to the Pledgor the Collateral and
all documents evidencing ownership of or title to the
Collateral.

 


 

5.2 Non-Release.
The security constituted hereby shall
not be released, discharged or in any way be affected
by:

 


 




(a)

any
increase or decrease in the amount of the Obligations of the
Pledgor;





 


 




(b)

an
extension of time for payment of the Obligations of the Pledgor;
or





 


 




(c)

any
forbearance whatsoever whether as to time, performance or
otherwise, or any compromise, arrangement or plan or reorganization
affecting the Pledgor.






 



4



 


 

 




 








 





 


 

 



ARTICLE 6

 



GENERAL CONTRACT PROVISIONS

 


 

6.1 Notices.
Any notices to a party under the
prov1s1ons of this Agreement shall be valid and effective if
delivered personally by courier or by facsimile or other acceptable
means of electronic transmission to, or if given by registered
mail, postage prepaid, to the addresses first above mentioned as
applicable to each party hereto, and shall be deemed to have been
given on the date of delivery personally or by facsimile
transmission if so delivered prior to 5:00 p.m. (Vancouver time) on
a Business Day and otherwise on the next Business Day or on the
third Business Day after such letter has been mailed, as the case
may be. The parties hereto may from time to time notify the other
party of a change in address which thereafter, until changed by
further notice, shall be the address of such party for all purposes
of this Agreement.

 


 

6.2 Severability.
Any provision hereof which is
prohibited or unenforceable shall be ineffective to the extent of
such prohibition or unenforceability without invalidating the
remaining provisions hereof.

 


 

6.3 Successors
and Assigns. This Agreement
enures to the benefit of and is binding upon the parties and their
respective successors and permitted assigns. Neither party to this
Agreement shall assign any right, title or interest in this
Agreement without the prior written consent of the other
party.

 


 

6.4 Entire
Agreement. This Agreement and
the agreements referred to herein constitute the entire agreement
between the parties hereto and supersede any prior agreements,
undertakings, declarations, representations and understandings,
both written and verbal, in respect of the subject matter
hereof.

 


 

 

6.5 Counterparts.
This Agreement may be executed and
delivered by the parties in one or more counterparts, each of which
will be an original, and each of which may be delivered by
facsimile or functionally
equivalent electronic means, and those counterparts will together
constitute one and the same instrument.


 

6.6 Environtech.
The Parties agree that Environtech may
act as Zongshen's nominee and agent in respect of the all matters
under this Agreement, including without limitation, accepting the
Pledged EMV Shares on behalf of Zongshen, and exercising all rights
and taking all actions for and on behalf of Zongshen
hereunder.


 


 

 



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blank.]


 

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IN WITNESS WHEREOF,
the parties hereto have executed this
agreement as of the date first above mentioned.


 


 

 
SIGNED and DELIVERED by JERRY                                  
           
           
   


 
KROLL in the presence of:    
           
           
           
           
           
           
           
           
            s/ Jerry
Kroll


    
          
           
           
           
           
           
           
           
           
           
           
           
           Jerry
Kroll


    
           
           
           
           
           
           
           
           
           
           
           
           
          CEO and General
Manager





s/ Sam
Wolf       


 Witness
(Signature) 



 



Sam
Wolf    



Name (please
print)  


 


 2018-814
Royal Avenue, New Westminster,
B.C                                                               


Address, City, Province


 



CHONGQING ZONGSHEN AUTOMOBILE INDUSTRY CO., LTD.

 

s/
Liu Gang 


Authorized
Signatory



 


 

 
6



 


 




 








 






 


 

 

SCHEDULE "A"


 



PLEDGED EMV SHARES


 


	
 Shareholder

	
 Type and
Number of Shares


	
 Price
per Share (USO)


	
 Certificate Number(s)



	
 Jerry Kroll


	
 800,000 Common Shares of
Electrameccania Vehicles Corp.


	
 $2.00

	
 •