Document:

ex_140467.htm

Exhibit 10.7

 

 

 

 

March 29, 2019

 

Kona Grill Inc.

15059 N. Scottsdale Rd. Suite 300

Scottsdale, AZ 85254

 

Dear Board of Directors:

 

This letter confirms and sets forth the terms and conditions of the engagement between Alvarez & Marsal North America, LLC (“A&M”) and Kona Grill Inc. and its subsidiaries, and its assigns and successors (the “Company”), including the scope of the services to be performed and the basis of compensation for those services. Upon execution of this letter by each of the parties below and receipt of the retainer described below, this letter will constitute an agreement between the Company and A&M (the “Agreement”).

 

	
			1.

				
			Description of Services

			

 

	 	
			(a)

				
			Officers. In connection with this engagement, A&M shall make available to the Company:

			

 

	 	
			(i)

				
			Jonathan M. Tibus to serve as the Chief Executive Officer (the “CEO”);

			

 

	 	
			(ii)

				Christopher J. Wells to serve as the Chief Restructuring Officer (the “CRO”); and

 

	 	
			(iii)

				
			One full time staff person to assist the CEO and CRO in their respective duties.

			

 

	 	
			(iv)

				Mr. Tibus’ and Mr. Wells’ appointments as CEO and CRO shall be effective as of April 17, 2019. Prior to such date Mr. Tibus and Mr. Wells shall serve in a consulting capacity to the Company with respect to the activities described in items (ii) through (x) of subpart (b) of this Section 1.

 

	 	
			(v)

				Upon the mutual agreement of A&M and the Board or Board Representative (as defined below), A&M will provide additional employees of A&M and/or its affiliates and wholly-owned subsidiaries (“Additional Personnel”) as required (collectively, with Mr. Tibus, Mr. Wells, and staff person, the “Engagement Personnel”), to assist in the execution of the duties as set forth more fully herein.

 

 

 

 

 

 

Kona Grill Inc.

March 29, 2019

 

	 	
			(b)

				
			Duties.

			

 

	 	
			(i)

				
			The CEO will perform those duties in a professional and workmanlike manner consistent with a Chief Executive Officer and with industry standards for professionals in similar positions. Additionally, it is anticipated that the Engagement Personnel, as required, will perform activities that may include the following

			

 

	 	
			(ii)

				
			Perform a financial review of the Company, including but not limited to a review and assessment of financial information that has been, and that will be, provided by the Company to its creditors, including without limitation its short and long-term projected cash flows and operating performance;

			

 

	 	
			(iii)

				
			Assist in the identification (and implementation) of cost reduction and operations improvement opportunities;

			

 

	 	
			(iv)

				
			Assist the Company with cash management including the development and maintenance of a 13-week cash flow forecast, creation of a DIP/ Cash Collateral budget as necessary, and preparation of reports and analyses to manage cash commitments and disbursements;

			

 

	 	
			(v)

				
			Monitor daily cash allocation and cash management/AP processes; assist management with cash maximization strategies;

			

 

	 	
			(vi)

				
			Communicate with the Company’s stakeholders, including but not limited to vendors, customers, employees, lenders, creditor committees, Court officials, attorneys and other service providers, as required;

			

 

	 	
			(vii)

				
			Assist the Company with issues related to its financing, sale and reorganization efforts, including assistance in preparation of reports and liaison with creditors;

			

 

	 	
			(viii)

				
			If requested, formulate and assist with the execution of a restructuring and/or reorganization plan, including preparation of a liquidation analysis and claims anlayses;

			

 

	 	
			(ix)

				
			Assist the Company with the formulation and execution of any communication plan regarding any strategic alternative pursued;

			

 

	 	
			(x)

				
			Assist the Company and their counsel in contingency planning;

			

 

	 	
			(c)

				
			The Engagement Personnel shall perform such other services as requested or directed by the board of the directors of the Company (the “Board”), the Company’s Strategic Alternatives Committee (the “Committee”), Shawn Hassel in his capacity as a representative of the Board and the Committee (the “Board Representative”) or such other Company personnel as authorized by the Board or Committee, and agreed to by A&M that is not duplicative of work others are performing for the Company.

			

 

-2-

 

 

Kona Grill Inc.

March 29, 2019

 

	 	
			(d)

				
			The Engagement Personnel shall report to the Board or other applicable designees, as directed by the Board or Board Representative and, at the request of the Board or Board Representative, will make recommendations to and consult with the Board and the Committee.

			

 

	 	
			(e)

				
			The Engagement Personnel will continue to be employed, by A&M and, while rendering services to the Company, will continue to work with other personnel at A&M in connection with unrelated matters that will not unduly interfere with the services rendered by the Engagement Personnel pursuant to this Agreement. With respect to the Company, however, the Engagement Personnel shall operate under the direction of the Board. The Engagement Personnel do not have authority to bind the Company without the prior approval of the Board or the Board Representative. Except for fraud, gross negligence and willful misconduct, A&M shall have no liability to the Company for any acts or omissions of the Engagement Personnel related to the performance or non-performance of services at the direction of the Board, Committee and/or Board Representative and consistent with the requirements of the Engagement and this Agreement.

			

 

	 	
			(f)

				
			In connection with the services to be provided hereunder, from time to time A&M may utilize the services of employees of its affiliates and subsidiaries as Engagement Personnel. Such affiliates and subsidiaries are wholly owned by A&M’s parent company and employees

			

 

	
			2.

				
			Information Provided by Company and Forward Looking Statements. The Company shall use all reasonable efforts to: (i) provide the Engagement Personnel with access to management and other representatives of the Company; and (ii) to furnish all data, material, and other information concerning the business, assets, liabilities, operations, cash flows, properties, financial condition and prospects of the Company that Engagement Personnel reasonably request in connection with the services to be provided to the Company. The Engagement Personnel shall rely, without further independent verification, on the accuracy and completeness of all publicly available information and information that is furnished by or on behalf of the Company and otherwise reviewed by Engagement Personnel in connection with the services performed for the Company. The Company acknowledges and agrees that the Engagement Personnel are not responsible for the accuracy or completeness of such information and shall not be responsible for any inaccuracies or omissions therein. A&M and Engagement Personnel are under no obligation to update data submitted to them or to review any other areas unless specifically requested by the Board to do so.

			

 

You understand that the services to be rendered by the Engagement Personnel may include the preparation of projections and other forward-looking statements, and numerous factors can affect the actual results of the Company’s operations, which may materially and adversely differ from those projections. In addition, Engagement Personnel will be relying on information provided by the Company in the preparation of those projections and other forward-looking statements.

 

-3-

 

 

Kona Grill Inc.

March 29, 2019

 

	
			3.

				
			Limitation of Duties. Neither A&M, nor the Engagement Personnel make any representations or guarantees that, inter alia, (i) an appropriate restructuring proposal or strategic alternative can be formulated for the Company, (ii) any restructuring proposal or strategic alternative presented to the Company’s management or the Board will be more successful than all other possible restructuring proposals or strategic alternatives, (iii) restructuring is the best course of action for the Company, or (iv) if formulated, that any proposed restructuring plan or strategic alternative will be accepted by any of the Company’s creditors, shareholders and other constituents. Further, neither A&M, nor the Engagement Personnel, assume any responsibility for the Company’s decision to pursue, or not pursue any business strategy, or to effect, or not to effect any transaction. The Engagement Personnel shall be responsible for implementation only of the restructuring proposal or alternative approved by the Board and only to the extent and in the manner authorized and directed by the Board.

			

 

	
			4.

				
			Compensation.

			

 

	 	
			(a)

				
			A&M will receive weekly compensation for the services of three initial Engagement Personnel (Tibus, Wells, 1 Support Staff) based on hourly rates (see below) not to exceed a fixed monthly fee, per person, as follows:

			

 

	 	
			(b)

				
			A&M’s hourly rates for Engagement Personnel is based on the following:

			

 

	 	Jonathan Tibus	$975 per hour
	 	Chris Wells 	$900 per hour
	 	 	 
	 	Other Engagement Personnel, if necessary:
	 	Managing Directors	$875-1,100
	 	Directors	$675-850
	 	Analysts/Associates 	$400-650

   

	 	
			(c)

				
			Courtesy Discount and fee cap: For this engagement, A&M will discount the above rates by 10% and provide an initial, one-time fee discount of $60,000 . In addition, all fees will be subject to the following monthly limits:

			

 

	 	Jonathan Tibus	Not to exceed $150,000 in any month
	 	Chris Wells	Not to exceed $120,000 in any month
	 	Total fees	Not to exceed $390,000 in the aggregate in any month.

          

Such rates shall be subject to adjustment annually at such time as A&M adjusts its rates generally, however, in no event shall A&M’s total monthly fees exceed $390,000. All fees and expenses will be billed on a biweekly basis or, at A&M’s discretion, more frequently. Invoices will be payable in arrears immediately upon invoice.

 

-4-

 

 

Kona Grill Inc.

March 29, 2019

 

	 	
			(d)

				
			In addition to the hourly compensation, A&M is eligible for incentive compensation in the amount of $100,000 (the “Incentive Fee”) to be considered upon the earlier of (x) the consummation of a Chapter 11 plan of reorganization; and (y) the sale, transfer, or other disposition of all or a substantial portion of the assets or equity of the Company in one or more transactions. Payment of the Incentive fee will be at the sole discretion of the Board.

			

 

	 	
			(e)

				
			To the extent staffing changes would result in additional personnel required, the fixed amount above would be augmented after discussion and approval of the Board;

			

 

	 	
			(f)

				
			In addition, A&M will be reimbursed for its reasonable out-of-pocket expenses incurred in connection with this assignment, such as travel, lodging, duplicating, messenger and telephone charges.

			

 

	 	
			(g)

				
			The Company shall promptly remit to A&M a retainer in the amount of $180,000, which shall be credited against any amounts due at the termination of this engagement and returned upon the satisfaction of all obligations hereunder.

			

 

	
			5.

				
			Termination.

			

 

	 	
			(a)

				
			This Agreement will apply from the commencement of the services referred to in Section 1 and may be terminated with immediate effect by either party without cause by written notice to the other party.

			

 

	 	
			(b)

				
			A&M normally does not withdraw from an engagement unless the Company misrepresents or fails to disclose material facts, fails to pay fees or expenses, or makes it unethical or unreasonably difficult for A&M to continue performance of the engagement, or other just cause exists.    

			

 

	 	
			(c)

				
			On termination of the Agreement, any fees and expenses due to A&M shall be remitted promptly (including fees and expenses that accrued prior to but are invoiced subsequent to such termination). 

			

 

	 	
			(d)

				
			The provisions of this Agreement that give the parties rights or obligations beyond its termination shall survive and continue to bind the parties.

			

 

	
			6.

				
			No Audit. Company acknowledges and agrees that A&M and Engagement Personnel are not being requested to perform an audit, review or compilation, or any other type of financial statement reporting engagement that is subject to the rules of the AICPA, SEC or other state or national professional or regulatory body.

			

 

	
			7.

				
			No Third Party Beneficiary. The Company acknowledges that all advice (written or oral) provided by A&M and the Engagement Personnel to the Company in connection with this engagement is intended solely for the benefit and use of the Company (limited to its Board and management) in considering the matters to which this engagement relates. The Company agrees that no such advice shall be used for any other purpose or reproduced, disseminated, quoted or referred to at any time in any manner or for any purpose other than accomplishing the tasks referred to herein without A&M’s prior approval (which shall not be unreasonably withheld), except as required by law.

			

 

-5-

 

 

Kona Grill Inc.

March 29, 2019

 

	
			8.

				
			Conflicts. A&M is not currently aware of any relationship that would create a conflict of interest with the Company or those parties-in-interest of which you have made us aware. However, we note that note that Shawn Hassel a member of the Board and Chairman of the Committee (who introduced A&M to this opportunity) is a prior Managing Director with A&M.  Mr. Hassel left full time employment with A&M in 2015. Since his departure, A&M’s parent company (Alvarez & Marsal Holdings, LLC (“A&M Holdings)) has made periodic payments to Mr. Hassel of amounts owed to him (plus interest) for the repurchase of his membership interests he held in A&M Holdings, in accordance with the terms of A&M Holdings limited liability company agreement.  On March 8, 2019, A&M Holdings paid the entire amount then outstanding for such interests in order to (a) reduce its interest exposure for future payments and (b) avoid having any financial obligation to Mr. Hassel when engaged in any matter in which he is involved.

			

 

Because A&M and its affiliates and subsidiaries comprise a consulting firm (the “Firm”) that serves clients on an international basis in numerous cases, both in and out of court, it is possible that the Firm may have rendered or will render services to, or have business associations with, other entities or people which had or have or may have relationships with the Company, including creditors of the Company. The Firm will not be prevented or restricted by virtue of providing the services under this Agreement from providing services to other entities or individuals, including entities or individuals whose interests may be in competition or conflict with the Company’s, provided the Firm makes appropriate arrangements to ensure that the confidentiality of information is maintained.

 

	
			9.

				
			Confidentiality/Non-Solicitation.

			

 

A&M and Engagement Personnel shall keep as confidential all non-public information received from the Company in conjunction with this engagement, except: (i) as requested by the Company or its legal counsel; (ii) as required by legal proceedings; or (iii) as reasonably required in the performance of this engagement. All obligations as to non-disclosure shall cease as to any part of such information to the extent that such information is, or becomes, public other than as a result of a breach of this provision. The Company, on behalf of itself and its subsidiaries and affiliates and any person which may acquire all or substantially all of its assets agrees that, until two (2) years subsequent to the termination of this engagement, it will not solicit, recruit, hire or otherwise engage any employee of A&M or any of its affiliates who worked on this engagement while employed by A&M or its affiliates (“Solicited Person”). Should the Company or any of its subsidiaries or affiliates or any person who acquires all or substantially all of its assets extend an offer of employment to or otherwise engage any Solicited Person and should such offer be accepted, A&M shall be entitled to a fee from the Company equal to the Solicited Person’s hourly client billing rate at the time of the offer multiplied by 4,000 hours for a Managing Director, 3,000 hours for a Senior Director and 2,000 hours for any other A&M employee. The Company acknowledges and agrees that this fee fairly represents the loss that A&M will suffer if the Company breaches this provision. The fee shall be payable at the time of the Solicited Person’s acceptance of employment or engagement.

 

-6-

 

 

	
			10.

				
			Indemnification/Limitations on Liability. The Company shall indemnify the Engagement Personnel acting as officers (the “Indemnified Professionals”) to the same extent as the most favorable indemnification it extends to its officers or directors, whether under the Company’s bylaws, its certificate of incorporation, by contract or otherwise, and no reduction or termination in any of the benefits provided under any such indemnities shall affect the benefits provided to the Indemnified Professionals. The Indemnified Professionals shall be covered as officers under the Company’s existing director and officer liability insurance policy. As a condition of A&M accepting this engagement, a Certificate of Insurance evidencing such coverage shall be furnished to A&M prior to the effective date of this Agreement The Company shall give thirty (30) days’ prior written notice to A&M of cancellation, non-renewal, or material change in coverage, scope, or amount of such director and officer liability policy. The Company shall also maintain such insurance coverage for the Indemnified Professionals for a period of not less than three years following the date of the termination of the Indemnified Professionals’ services hereunder. The provisions of this section are in the nature of contractual obligations and no change in applicable law or the Company’s charter, bylaws or other organizational documents or policies shall affect the Indemnified Professionals’ rights hereunder. The attached indemnity and limitation on liability provisions are incorporated herein and the termination of this agreement or the engagement shall not affect those provisions, which shall remain in full force and effect.

			

 

	
			11.

				
			Joint and Several Liability

			

 

The Company and each of its subsidiaries (“Company Entities”) hereby acknowledge and agree that they are each jointly and severally liable to A&M and its affiliates for all of the Company's representations, warranties, covenants, liabilities and obligations set forth in the Agreement. Any beneficiary of this agreement may seek to enforce any of its rights and remedies hereunder against any or all Company Entities in any order at any time in its sole discretion.

 

	
			12.

				
			Miscellaneous. This Agreement (together with the attached indemnity provisions), including, without limitation, the construction and interpretation thereof and all claims, controversies and disputes arising under or relating thereto, shall be governed and construed in accordance with the laws of the State of New York, without regard to principles of conflict of law that would defer to the laws of another jurisdiction. The Company and A&M agree to waive trial by jury in any action, proceeding or counterclaim brought by or on behalf of the parties hereto with respect to any matter relating to or arising out of the engagement or the performance or non-performance of A&M hereunder. The Company and A&M agree, to the extent permitted by applicable law, that any Federal Court sitting within the Southern District of New York shall have exclusive jurisdiction over any litigation arising out of this Agreement; to submit to the personal jurisdiction of the Courts of the United States District Court for the Southern District of New York; and to waive any and all personal rights under the law of any jurisdiction to object on any basis (including, without limitation, inconvenience of forum) to jurisdiction or venue within the State of New York for any litigation arising in connection with this Agreement. Notwithstanding anything herein to the contrary, in the event the Company commences a proceeding under the Bankruptcy Code, any and all disputes arising out of this Agreement shall be subject to the exclusive jurisdiction of the court overseeing said bankruptcy proceeding.

			

 

-7-

 

 

Kona Grill Inc.

March 29, 2019

 

This Agreement shall be binding upon A&M and the Company, their respective heirs, successors, and assignees, and any heir, successor, or assignee of a substantial portion of A&M’s or the Company’s respective businesses and/or assets, including any Chapter 11 Trustee. This Agreement incorporates the entire understanding of the parties with respect to the subject matter hereof and may not be amended or modified except in writing executed by the Company and A&M. Notwithstanding anything herein to the contrary, A&M may reference or list the Company’s name and/or logo and/or a general description of the services in A&M’s marketing materials, including, without limitation, on A&M’s website.

 

 

 

If the foregoing is acceptable to you, kindly sign the enclosed copy to acknowledge your agreement with its terms.

 

	 	Very truly yours,
	 	 	 
	 	Alvarez & Marsal North America, LLC
	 	 	 
	 	 	 
	 	 	 
	 	By:	 /s/ Jonathan Tibus                                                              
	 	 	Jonathan M. Tibus
	 	 	Managing Director

 

 

	 	Accepted and agreed:
	 	 	 
	 	Kona Grill Inc., on behalf of itself and its subsidiaries
	 	 	 
	 	By:	/s/ Christi Hing                                
	 	 	Title: Christi Hing, CFO

 

-8-

 

 

INDEMNIFICATION AND LIMITATION ON LIABILITY AGREEMENT

 

This indemnification and limitation on liability agreement is made part of an agreement, dated March 29, 2019 (which together with any renewals, modifications or extensions thereof, is herein referred to as the "Agreement") by and between Alvarez & Marsal North America, LLC ("A&M”) and Kona Grill Inc. together with its subsidiaries (jointly and severally, the “Company”), for services to be rendered to the Company by A&M.

 

A.     The Company agrees to indemnify and hold harmless each of A&M, its affiliates and their respective shareholders, members, managers, employees, agents, representatives and subcontractors (each, an "Indemnified Party" and collectively, the "Indemnified Parties") against any and all losses, claims, damages, liabilities, penalties, obligations and expenses, including the costs for counsel or others (including employees of A&M, based on their then current hourly billing rates) in investigating, preparing or defending any action or claim, whether or not in connection with litigation in which any Indemnified Party is a party, or enforcing the Agreement (including these indemnity provisions), as and when incurred, caused by, relating to, based upon or arising out of (directly or indirectly) the Indemnified Parties' acceptance of or the performance or nonperformance of their obligations under the Agreement; provided, however, such indemnity shall not apply to any such loss, claim, damage, liability or expense to the extent it is found in a final judgment by a court of competent jurisdiction (not subject to further appeal) to have resulted primarily and directly from such Indemnified Party's gross negligence or willful misconduct. The Company also agrees that (a) no Indemnified Party shall have any liability (whether direct or indirect, in contract or tort or otherwise) to the Company for or in connection with the engagement of A&M, except to the extent that any such liability for losses, claims, damages, liabilities or expenses are found in a final judgment by a court of competent jurisdiction (not subject to further appeal) to have resulted primarily and directly from such Indemnified Party's gross negligence or willful misconduct and (b) in no event will any Indemnified Party have any liability to the Company for special, consequential, incidental or exemplary damages or loss (nor any lost profits, savings or business opportunity). The Company further agrees that it will not, without the prior consent of an Indemnified Party, settle or compromise or consent to the entry of any judgment in any pending or threatened claim, action, suit or proceeding in respect of which such Indemnified Party seeks indemnification hereunder (whether or not such Indemnified Party is an actual party to such claim, action, suit or proceedings) unless such settlement, compromise or consent includes an unconditional release of such Indemnified Party from all liabilities arising out of such claim, action, suit or proceeding.

 

B.     These indemnification provisions shall be in addition to any liability which the Company may otherwise have to the Indemnified Parties. In the event that, at any time whether before or after termination of the engagement or the Agreement, as a result of or in connection with the Agreement or A&M’s and its personnel’s role under the Agreement, A&M or any Indemnified Party is required to produce any of its personnel (including former employees) for examination, deposition or other written, recorded or oral presentation, or A&M or any of its personnel (including former employees) or any other Indemnified Party is required to produce or otherwise review, compile, submit, duplicate, search for, organize or report on any material within such Indemnified Party’s possession or control pursuant to a subpoena or other legal (including administrative) process, the Company will reimburse the Indemnified Party for its out of pocket expenses, including the reasonable fees and expenses of its counsel, and will compensate the Indemnified Party for the time expended by its personnel based on such personnel’s then current hourly rate.

 

 

 

 

Kona Grill Inc.

March 29, 2019

 

C.     If any action, proceeding or investigation is commenced to which any Indemnified Party proposes to demand indemnification hereunder, such Indemnified Party will notify the Company with reasonable promptness; provided, however, that any failure by such Indemnified Party to notify the Company will not relieve the Company from its obligations hereunder, except to the extent that such failure shall have actually prejudiced the defense of such action. The Company shall promptly pay expenses reasonably incurred by any Indemnified Party in defending, participating in, or settling any action, proceeding or investigation in which such Indemnified Party is a party or is threatened to be made a party or otherwise is participating in by reason of the engagement under the Agreement, upon submission of invoices therefor, whether in advance of the final disposition of such action, proceeding, or investigation or otherwise. Each Indemnified Party hereby undertakes, and the Company hereby accepts its undertaking, to repay any and all such amounts so advanced if it shall ultimately be determined that such Indemnified Party is not entitled to be indemnified therefor. If any such action, proceeding or investigation in which an Indemnified Party is a party is also against the Company, the Company may, in lieu of advancing the expenses of separate counsel for such Indemnified Party, provide such Indemnified Party with legal representation by the same counsel who represents the Company, provided such counsel is reasonably satisfactory to such Indemnified Party, at no cost to such Indemnified Party; provided, however, that if such counsel or counsel to the Indemnified Party shall determine that due to the existence of actual or potential conflicts of interest between such Indemnified Party and the Company such counsel is unable to represent both the Indemnified Party and the Company, then the Indemnified Party shall be entitled to use separate counsel of its own choice, and the Company shall promptly advance its reasonable expenses of such separate counsel upon submission of invoices therefor. Nothing herein shall prevent an Indemnified Party from using separate counsel of its own choice at its own expense. The Company will be liable for any settlement of any claim against an Indemnified Party made with the Company's written consent, which consent shall not be unreasonably withheld.

 

D.     .In order to provide for just and equitable contribution if a claim for indemnification pursuant to these indemnification provisions is made but it is found in a final judgment by a court of competent jurisdiction (not subject to further appeal) that such indemnification may not be enforced in such case, even though the express provisions hereof provide for indemnification, then the relative fault of the Company, on the one hand, and the Indemnified Parties, on the other hand, in connection with the statements, acts or omissions which resulted in the losses, claims, damages, liabilities and costs giving rise to the indemnification claim and other relevant equitable considerations shall be considered; and further provided that in no event will the Indemnified Parties' aggregate contribution for all losses, claims, damages, liabilities and expenses with respect to which contribution is available hereunder exceed the amount of fees actually received by the Indemnified Parties pursuant to the Agreement. No person found liable for a fraudulent misrepresentation shall be entitled to contribution hereunder from any person who is not also found liable for such fraudulent misrepresentation.

 

-10-

 

 

Kona Grill Inc.

March 29, 2019

 

E.     In the event the Company and A&M seek judicial approval for the assumption of the Agreement or authorization to enter into a new engagement agreement pursuant to either of which A&M would continue to be engaged by the Company, the Company shall promptly pay expenses reasonably incurred by the Indemnified Parties, including attorneys' fees and expenses, in connection with any motion, action or claim made either in support of or in opposition to any such retention or authorization, whether in advance of or following any judicial disposition of such motion, action or claim, promptly upon submission of invoices therefor and regardless of whether such retention or authorization is approved by any court. The Company will also promptly pay the Indemnified Parties for any expenses reasonably incurred by them, including attorneys' fees and expenses, in seeking payment of all amounts owed it under the Agreement (or any new engagement agreement) whether through submission of a fee application or in any other manner, without offset, recoupment or counterclaim, whether as a secured claim, an administrative expense claim, an unsecured claim, a prepetition claim or a postpetition claim.

 

F.     Neither termination of the Agreement nor termination of A&M's engagement nor the filing of a petition under Chapter 7 or 11 of the United States Bankruptcy Code (nor the conversion of an existing case to one under a different chapter) shall affect these indemnification provisions, which shall hereafter remain operative and in full force and effect.

 

G.     .The rights provided herein shall not be deemed exclusive of any other rights to which the Indemnified Parties may be entitled under the certificate of incorporation or bylaws of the Company, any other agreements, any vote of stockholders or disinterested directors of the Company, any applicable law or otherwise.

 

 

 

	
			 

			Kona Grill, Inc., on behalf of itself 

			and its subsidiaries

			 

			 

			 

			 

			By:      /s/ Christi Hing                           

			 

				
			ALVAREZ & MARSAL NORTH

			AMERICA, LLC

			 

			 

			 

			 

			By:   /s/ Jonathan Tibus                       

			

 

-11-Exhibit 4.11

 

Share Pledge Agreement

 

This Share Pledge Agreement (this “Agreement”)
has been executed by and among the following Parties on January 28, 2019 in Hangzhou:

 

		Party A:	Weidai Co., Ltd. (hereinafter “Pledgee”)

 

		Address:	Room A-B102-1102, No. 198 of Qidi Road, Xiaoshan Economic-technical Development Zone, Xiaoshan District, Hangzhou, Zhejiang
Province

 

		Party B:	[Name] (hereinafter “Pledgor”)

 

		ID Number:	[ID
number]

 

		Party C:	Hangzhou
                                         Yuntuo group co., LTD.

 

		Address:	Room A-B102-1237, No. 198 of Qidi Road, Xiaoshan Economic-technical Development Zone, Xiaoshan District, Hangzhou, Zhejiang
Province

 

		Legal Representative:	***

 

In this Agreement, each of Pledgee, Pledgor
and Party C shall be referred to as a “Party” respectively, and they shall be collectively referred to as the
“Parties”.

 

Whereas,

 

		1.	Pledgor is the citizen of the People's Republic of China (“China”), and holds              % of the equity interest in Party C. Party C is a limited liability company registered in Hangzhou, China. Party
C acknowledges the respective rights and obligations of Pledgor and Pledgee under this Agreement, and agrees to provide any necessary
assistance in registering the Pledge;

 

		2.	Pledgee is a Wholly Foreign Owned Enterprise registered in Hangzhou, China. Pledgee and Party C
have executed an Exclusive Business Cooperation Agreement on January 28, 2019 (the “Exclusive Business Cooperation Agreement”);
Pledgee, Pledgor and Party C entered into the Exclusive Call Option Contract on January 28, 2019 (the “Exclusive Call
Option Contract”), and Pledgor executed the Power of Attorney to authorize Pledgee on January 28, 2019 (the “Power
of Attorney”; together with the Exclusive Business Cooperation Agreement, the Exclusive Call Option Contract and this
Contract, the “Control Agreements”).

 

		3.	To ensure that Pledgee collects all payments due by Party C, including without limitation the consulting
and service fees regularly from Party C, and guarantee the performance by Party C and Pledgor of other obligations under the Control
Agreements, Pledgor hereby pledge all of the equity interest he/she holds in Party C as security for the obligations under the
Control Agreements.

 

    	 	Share Pledge Agreement	 

     

    

 

		1.	Definitions

 

Unless otherwise
provided herein, the terms below shall have the following meanings:

 

		1.1	“Pledge” shall refer to the security interest granted by Pledgor to Pledgee
pursuant to Article 2 of this Agreement, i.e., the right of Pledgee to be compensated on a preferential basis with the conversion,
auction or sales price of the Equity Interest.

 

		1.2	“Equity Interest” shall refer to all of the equity interest lawfully now held
and hereafter acquired by Pledgor in Party C.

 

		1.3	“Term of Pledge” shall refer to the term set forth in Section 3 of this Agreement.

 

		1.4	“Contractual Obligations” shall mean all obligations of the Pledgor and Party C under
the Exclusive Business Cooperation Agreement, the Exclusive Call Option Contract, the Power of Attorney and this Contract (including,
without limitation, the obligation to pay consulting and service fees to the Pledgee when they fall due and payable (whether on
the specified due date, by early repayment or otherwise) in accordance with the Exclusive Business Cooperation Agreement).

 

		1.5	“Secured Indebtedness” shall mean all direct, indirect and consequential losses and
loss of foreseeable profits suffered by the Pledgee due to any Event of Default of the Pledgor and/or Party C. The basis for the
amounts of such losses includes, but is not limited to, reasonable business plans and profit forecasts of the Pledgee, and all
costs incurred by the Pledgee in connection with its enforcement of the Contractual Obligations against the Pledgor and/or Party
C.

 

		1.5	“Event of Default” shall refer to any of the circumstances set forth in Article 7 of this Agreement.

 

		1.6	“Notice of Default” shall refer to the notice issued by Pledgee in accordance with this Agreement declaring
an Event of Default.

 

		2.	The Pledge

 

		2.1	As collateral security for the prompt and complete payment and performance when due (whether
                                                                             at stated maturity, by acceleration or otherwise) of any or all the payments due by Party C, including without limitation the
                                                                             consulting and services fees payable to the Pledgee under the Exclusive Business Cooperation Agreement (collectively, the
                                                                             “Secured Obligations”), Pledgor hereby pledges to Pledgee a first security interest in the              %
                                                                             (¥                 .00) Equity
                                                                             Interest of Party C owned by the Pledgor (including the                %
                                                                             registered capital (amount of capital contribution) currently owned by the Pledgor and all relevant equity interest, as well
                                                                             as other registered capital (amount of capital contribution) and all relevant equity interest, which may be obtained by
                                                                             the Pledgor in the future),the amount of secured creditor's rights is
                                                                             ¥                         .00.

 

		2.2	The Parties understand and agree that the monetary valuation arising from, relating to or in connection
with the Secured Obligations shall be a variable and floating valuation until the Settlement Date (as defined below).

 

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		2.3	Upon the occurrence of any of the events below (each an “Event of Settlement”),
the Secured Obligations shall be fixed at a value of the sum of all Secured Obligations that are due, outstanding and payable to
the Pledgee on or immediately prior to the date of such occurrence (the “Fixed Obligations”):

 

		(a)	any other Control Agreement expires or is terminated pursuant to the stipulations thereunder;

 

		(b)	the occurrence of an Event of Default pursuant to Section 7 that is not resolved, which results
in the Pledgee serving a Notice of Default to the Pledgor pursuant to Section 7.3;

 

		(c)	the Pledgee reasonably determines (having made due enquiries) that the Pledgor and/or Party C is
insolvent or could potentially be made insolvent; or

 

		(d)	any other event that requires the settlement of the Secured Obligations in accordance with relevant
laws of the PRC.

 

		2.4	For the avoidance of doubt, the day of the occurrence of an Event of Settlement shall be the settlement
date (the “Settlement Date”). On or after the Settlement Date, the Pledgee shall be entitled, at the election
of the Pledgee, to enforce the Pledge in accordance with Section 8.

 

		2.5	The Pledgee is entitled to collect dividends or other distributions, if any, arising from the Equity
Interest during the Term of the Pledge (as defined below).

 

		2.6	The Pledgor may increase the capital of Party C only with the prior written consent of the Pledgee.
Any increase in the capital contributed by the Pledgor to the registered capital of Party C as a result of any capital increase
shall also be deemed as the Equity Interest pledged hereunder.

 

		2.7	If Party C is required to be dissolved or liquidated in accordance with the mandatory provisions
of the laws of the PRC, after Party C completes dissolution or liquidation procedures in accordance with law, any interests distributed
to the Pledgor by Party C in accordance with law shall be, as requested by the Pledgee, (1) deposited into an account designated
by the Pledgee, placed under the custody of the Pledgee, used to provide security for the Contractual Obligations and first applied
towards the satisfaction of the Secured Indebtedness; or (2) unconditionally donated to the Pledgee or the person designated by
the Pledgee subject to the laws of the PRC.

 

		3.	Term of Pledge

 

		3.1	The Pledge shall become effective as of the date when the pledge of the Equity Interest is registered
with the local administration of industry and commerce (the “Registration Authority”). The Term of the Pledge
(the “Term of Pledge Authority”) shall end when the Contractual Obligations and the Secured Indebtedness secured
by the Pledge are paid or fully fulfilled. The Parties agree that, promptly after the execution of this Agreement (but in no event
later than 20 days from the execution date of this Agreement), Pledgor and Party A shall submit their application for pledge registration
to the Registration Authority in accordance with the Measures on Share Pledge Registration with the Administration of Industry
and Commerce. The Parties also agree that within fifteen (15) days as of the Registration Authority officially commences the
acceptance of equity pledge application, Pledgor and Party C shall complete the pledge registration procedure, obtain the pledge
registration notice and completely and accurately register the Pledge of Equity Interest on the Pledge Registration Book of the
Registration Authority. The Parties jointly acknowledge that, for the purpose of completing equity pledge registration formalities,
the Parties shall submit this Contract or an equity pledge contract which is executed in the form requested by the administrative
authority for industry and commerce in the locality of Party C and truly reflects the information regarding the Pledge hereunder
(the “Pledge Contract for Industrial and Commercial Registration”) to the administrative authority for industry
and commerce. This Contract shall apply to the matters not mentioned in the Pledge Contract for Industrial and Commercial Registration.

 

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		3.2	During the Term of Pledge, in the event Party C fails to perform the Contractual Obligations or
repay the Secured Indebtedness, Pledgee shall have the right, but not the obligation, to dispose of the Pledge in accordance with
the provisions of this Agreement.

 

		4.	Custody of Records for Equity Interest subject to Pledge

 

		4.1	During the Term of Pledge set forth in this Agreement, Pledgor shall deliver to Pledgee's custody
the capital contribution certificate for the Equity Interest and the shareholders' register containing the Pledge (and other documents
reasonably requested by the Pledgee, including without limitation the notice of registration of the Pledge issued by relevant administration
of industry and commerce) within one week from the date the Pledge is registered. Pledgee shall have custody of such items during
the entire Term of Pledge set forth in this Agreement.

 

		5.	Representations and Warranties of Pledgor and Party C

 

The Pledgor Represent and Warrant to the Pledgee
that:

 

		5.1	Pledgor is the sole legal and beneficial owners of the Equity Interest. Except for being subject
to other agreements entered into by the Pledgor and the Pledgee, the Pledgor enjoys legal and complete ownership of the Equity
Interest.

 

		5.2	Pledgee shall have the right to dispose of and transfer the Equity Interest in accordance with
the provisions set forth in this Agreement.

 

		5.3	Except for the Pledge, Pledgor has not placed any security interest or other encumbrance on the
Equity Interest. There are no controversies over the ownership of the Equity Interest. The Equity Interest is not seized or subject
to any other legal proceedings or similar threats, and is good for transfer and pledging according to applicable laws.

 

		5.4	The Pledgor's execution of this Agreement and exercise of its rights under this Agreement (or fulfillment
of its obligations under this Agreement) will not breach any laws, regulations, and agreements or contracts to which the Pledgor
is a party, or any promise the Pledgor has made to any third parties.

 

		5.5	All documents, materials, statements and certificates provided by the Pledgor to the Pledgee are
accurate, true, complete and valid.

 

Party C Represent and
Warrant to the Pledgee that:

 

		5.6	Party C is a limited liability company registered under the laws of China and legally exists. Party
C has the qualification of an independent legal person, enjoys complete and independent legal status and the legal capacity to
sign, deliver and fulfill this Agreement.

 

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		5.7	Upon due execution of Party C, this Agreement constitute legal, effective and binding obligation
on Party C.

 

		5.8	Party C has the complete internal right and authorization to sign and deliver this Agreement and
all other documents relating to the transactions contemplated under this Agreement. Party C has the complete right and authorization
to complete the transactions contemplated under this Agreement.

 

		5.9	Regarding the assets owned by Party C, there are not any guarantee interests or any other encumbrance
on property rights that are substantial and may impact the Pledgee's right and interests in the Equity Interest (including without
limitation transfer of any of Party C's intellectual properties or any assets with an a value equaling or over RMB 100,000, or
any encumbrance on the ownership or right to use of such assets).

 

		5.10	Without the prior written consent of Party A, they shall not incur, inherit, guarantee or suffer
the existence of any debt, except for (i) debts incurred in the ordinary course of business other than through loans; and (ii)
debts disclosed to Party A for which Party A's written consent has been obtained;

 

		5.11	They shall always operate all of Party C's businesses during the ordinary course of business to
maintain the asset value of Party C and refrain from any action/omission that may affect Party C's operating status and asset value;

 

		5.12	In any court or arbitration tribunal, there are no pending (or, as far as Party knows, threatening)
litigation, arbitration or other legal proceedings against the Equity Interest, Party C or its assets, and in any governmental
agencies or departments, there are no pending (or, as far as Party knows, threatening) administrative proceedings or penalties
against the Equity Interest, Party C or its assets, which may substantially and adversely impact Party C's economic condition or
the Pledgor's ability to fulfill their obligations and guarantee liabilities under this Agreement.

 

		5.13	Party C hereby agrees that it is jointly and severally liable to the Pledgee for all representations
and warranties made by any and all of the Pledgor under this Agreement.

 

		5.14	Party C hereby warrants to the Pledgee that, at any time and under any circumstances prior to complete
fulfillment of the obligations under this Agreement or the secured debts being fully repaid, the aforementioned representations
and warranties are true and accurate and will be fully complied with.

 

		6.	Covenants and Further Agreements of Pledgor

 

The covenants and further agreements
of the Pledgor are set forth below.

 

		6.1	Pledgor hereby covenants to the Pledgee, that during the term of this Agreement, Pledgor shall:

 

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		6.1.1	not transfer (or agree to others' transfer of) all or any part of the Equity Interest, place or
permit the existence of any security interest or other encumbrance that may affect the Pledgee's rights and interests in the Equity
Interest, without the prior written consent of Pledgee, except for the performance of the Exclusive Option Agreement executed by
Pledgor, Pledgee and Party C on January 28, 2019;

 

		6.1.2	comply with the provisions of all laws and regulations applicable to the pledge of rights, and
within 5 days of receipt of any notice, order or recommendation issued or prepared by relevant competent authorities (or any other
relevant parties) regarding the Pledge, shall present the aforementioned notice, order or recommendation to Pledgee, and shall
comply with the aforementioned notice, order or recommendation or submit objections and representations with respect to the aforementioned
matters upon Pledgee's reasonable request or upon consent of Pledgee;

 

		6.1.3	promptly notify Pledgee of any event or notice received by Pledgor that may have an impact on Pledgee's
rights to the Equity Interest or any portion thereof, as well as any event or notice received by Pledgor that may have an impact
on any guarantees and other obligations of Pledgor arising out of this Agreement.

 

		6.2	Pledgor agrees that the rights acquired by Pledgee in accordance with this Agreement with respect
to the Pledge shall not be interrupted or harmed by Pledgor or any heirs or representatives of Pledgor or any other persons through
any legal proceedings.

 

		6.3	To protect or perfect the security interest granted by this Agreement, Pledgor hereby undertakes
to execute in good faith and to cause other parties who have an interest in the Pledge to execute all certificates, agreements,
deeds and/or covenants required by Pledgee. Pledgor also undertakes to perform and to cause other parties who have an interest
in the Pledge to perform actions required by Pledgee, to facilitate the exercise by Pledgee of its rights and authority granted
thereto by this Agreement, and to enter into all relevant documents regarding ownership of Equity Interest with Pledgee or designee(s)
of Pledgee (natural/legal persons). Pledgor undertakes to provide Pledgee within a reasonable time with all notices, orders and
decisions regarding the Pledge that are required by Pledgee.

 

		6.4	Pledgor hereby undertakes to comply with and perform all guarantees, promises, agreements, representations
and conditions under this Agreement. In the event of failure or partial performance of its guarantees, promises, agreements, representations
and conditions, Pledgor shall indemnify Pledgee for all losses resulting therefrom.

 

		6.5	If the Equity Interest pledged under this Agreement is, for any reason, subject to mandatory measures
imposed by the court of law or other governmental departments, the Pledgor shall try their best to release such mandatory measures
imposed by the court of law or other governmental departments, including without limitation providing to the court of law other
kinds of security or other measures.

 

		6.6	If there is a possibility that the value of the Equity Interest will be decreased and such decrease
is sufficient to harm the rights and interests of the Pledgee, the Pledgee may request the Pledgor to provide additional collateral
or security. If the Pledgor refuses to provide such security, the Pledgee may, at any time, sell the Equity Interest or put it
up for auction, and use the monies obtained from such sale or auction to settle the secured obligations in advance or put such
monies under custody; all expenses therefore occurred shall be borne by the Pledgor.

 

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		6.7	Without the prior written consent from the Pledgee, the Pledgor and/or Party C shall not (by themselves
or assisting others to) increase, decrease or transfer the registered capital of Party C (or their capital contribution to Party
C) or impose any encumbrances on it, including the Equity Interest. Subject to the forgoing provision, any Equity Interest which
is registered and obtained by the Pledgor subsequent to the date of this Agreement shall be called "Additional Equity Interest".
The Pledgor and Party C shall, immediately after the Pledgor obtains the Additional Equity Interest, enter with the Pledgee supplemental
share pledge agreement for the Additional Equity Interest, make the board of directors and shareholders meeting of Party C approve
the supplemental share pledge agreement, and deliver to the Pledgee all documents necessary for the supplemental share pledge agreement,
including without limitation (a) the original certificate issued by Party C about shareholders' capital contribution relating to
the Additional Equity Interest; and (b) the verified photocopy of the capital contribution verification report (issued by certified
public accountant in China) regarding the Additional Equity Interest. The Pledgor and Party C shall, according to Article 3.1 of
this Agreement, handle the pledge registration procedures relating to the Additional Equity Interest.

 

		6.8	Unless otherwise instructed by the Pledgee in writing, the Pledgor and/or Party C agree that, if
part of or all of the Equity Interest is transferred between the Pledgor and any third parties in violation of this Agreement ("Transferee
of the Equity Interest"), then the Pledgor and/or Party C shall ensure that the Transferee or the Equity Interest will unconditionally
recognize the Pledge and follow necessary procedures for modification of the registration of the Pledge (including without limitation
signing relevant documents) so as to ensure the continued existence of the Pledge.

 

		6.9	If the Pledgee provides to Party C loan of monies, the Pledgor and/or the Party C agree to pledge
the Equity Interest to the Pledgee for security of such additional loan of monies, and to follow procedures as soon as possible
according to relevant laws, regulations or local practice (if any), including without limitation executing relevant documents and
completing registration procedures for setting up (or modification) of a pledge.

 

The covenants and further agreements
of Party C are set forth below.

 

		6.10	If, for the execution of this Agreement and Pledge under this Agreement, it is necessary to obtain
any third party consent, approval, waiver or authorization, any governmental approval, license or waiver, or complete registration
procedures in any governmental departments (as required by the law), then Party C will try its best to assist in obtainning the
same and cause it to remain in effect during the term of this Agreement.

 

		6.11	Without prior written consent of the Pledgee, Party C will not provide any person with any loan
or credit or guarantee in any form; assist or allow the Pledgor to set up any new pledges or grant other security over the Equity
Interest, nor will Party C assist or allow the Pledgor to transfer the Equity Interest.

 

		6.12	Party C agrees to, jointly with the Pledgor, strictly comply with Article 6.7, Article 6.8 and
Article 6.9 of this Agreement.

 

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		6.13	Without prior written consent of the Pledgee, Party C shall not transfer its assets or set up (or
allow the existence of) any security or encumbrances on property rights that may affect the Pledgee's rights and interests in the
Equity Interest (including without limitation transfer of any of Party C's intellectual properties or any assets with an a value
equaling or over RMB 100,000, or any encumbrance on the ownership or right to use of such assets).

 

		6.14	Where there are any litigations, arbitrations or any other claims, which may adversely impact party
C, the Equity Interest, or the Pledgee's interests under the Control Agreements, Party C shall, as soon as possible, send timely
notice to the Pledgee and according to reasonable requests of the Pledgee take all necessary measures to protect the Pledgee's
interests in the Equity Interest.

 

		6.15	Party C shall not conduct or allow any acts or actions that may adversely impact the Equity Interest
or Pledgee's interest under the Control Agreements.

 

		6.16	Party C shall, during the first month of each quarter, provide to the Pledgee its financial statements
for the preceding quarter, including without limitation its balance sheets, profit statements and cash flow statements.

 

		6.17	Party C shall, pursuant to the Pledgee's reasonable requests, take all necessary measures and sign
all necessary documents so as to ensure and protect the Pledgee's rights over the Equity Interest and realization of them.

 

		6.18	If the exercise of the Pledge under this Agreement results to any transfer of the Equity Interest,
Party C agrees and warrants that it will take all measures to effect such transfer.

 

		6.19	Party B shall ensure and cause the other shareholders of Party C to ensure that Party C will complete
the operation term extension registration formalities within three (3) months prior to the expiration of its operation term so
that the validity of this Contract shall be maintained.

 

		7.	Event of Default

 

		7.1	The following circumstances shall be deemed Event of Default:

 

		7.1.1	Party C fails to pay in full any of the consulting and service fees payable under the Exclusive
Business Cooperation Agreement, or fail to repay its loan or breaches any other obligations of Party C under the Control Agreements;

 

		7.1.2	Any representation or warranty by Pledgor in Article 5 of this Agreement contains material misrepresentations
or errors, and/or Pledgor violates any of the warranties in Article 5 of this Agreement;

 

		7.1.3	Pledgor and Party C fail to complete the registration of the Pledge with Registration Authority;

 

		7.1.4	Pledgor and Party C breach any provisions of this Agreement;

 

		7.1.5	Except as expressly stipulated in Section 6.1.1, Pledgor transfers or purports to transfer or abandons
the Equity Interest pledged or assigns the Equity Interest pledged without the written consent of Pledgee;

 

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		7.1.6	Any of Pledgor's own loans, guarantees, indemnifications, promises or other debt liabilities to
any third party or parties (1) become subject to a demand of early repayment or performance due to default on the part of Pledgor;
or (2) become due but are not capable of being repaid or performed in a timely manner;

 

		7.1.7	Any approval, license, permit or authorization of government agencies that makes this Agreement
enforceable, legal and effective is withdrawn, terminated, invalidated or substantively changed;

 

		7.1.8	The promulgation of applicable laws renders this Agreement illegal or renders it impossible for
Pledgor to continue to perform its obligations under this Agreement;

 

		7.1.9	Adverse changes in properties owned by Pledgor, which lead Pledgee to believe that that Pledgor's
ability to perform its obligations under this Agreement has been affected;

 

		7.1.10	The successor or custodian of Party C is capable of only
partially performing or refuses to perform the payment obligations under the Exclusive Business Cooperation Agreement; and

		 	 

		7.1.11	Any other circumstances occur where Pledgee is or may
become unable to exercise its right with respect to the Pledge.

 

		7.2	Upon notice or discovery of the occurrence of any circumstances or event that may lead to the aforementioned
circumstances described in Section 7.1, Pledgor shall immediately notify Pledgee in writing accordingly.

 

		7.3	Unless an Event of Default set forth in this Section 7.1 has been successfully resolved to Pledgee's
satisfaction within thirty (30) days of the Pledgee’s notice, Pledgee may issue a Notice of Default to Pledgor in writing
upon the occurrence of the Event of Default or at any time thereafter and demand that Pledgor immediately pays all outstanding
payments due under the Control Agreements, and/or repays loans and all other payments due to Pledgee, and/or disposes of the Pledge
in accordance with the provisions of Article 8 of this Agreement.

 

		8.	Exercise of Pledge

 

		8.1	Pledgor shall not assign the Pledge or the Equity Interest in Party C without the Pledgee's written
consent.

 

		8.2	Pledgee may issue a Notice of Default to Pledgor when exercising the Pledge.

 

		8.3	Subject to the provisions of Section 7.3, Pledgee may exercise the right to enforce the Pledge
concurrently with the issuance of the Notice of Default in accordance with Section 7.2 or at any time after the issuance of the
Notice of Default. Once Pledgee elects to enforce the Pledge, Pledgor shall cease to be entitled to any rights or interests associated
with the Equity Interest.

 

		8.4	In the event of default, to the extent permitted, Pledgee is entitled to take possession of the
Equity Interest pledged hereunder and to dispose of the Equity Interest pledged and exercise all of its remedies and rights for
breach of contract in accordance with law; if, after satisfying all obligations secured, there is any balance in the monies collected
by the Pledgee by enforcing the Pledge, then such balance shall be, without calculation of interests, paid to the Pledgor or other
parties entitled to receive such balance. The Pledgee shall not be liable for any loss caused by its reasonable exercise of its
remedies and rights for breach of contract. The Pledgee shall have the right, at its option, to exercise any of its remedies for
breach of contract simultaneously or successively. The Pledgee shall not be required to exercise other remedies for breach of contract
before its exercise of the right to be repaid in priority out of the proceeds from the conversion, auction or sale of the Equity
Interest pledged hereunder.

 

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		8.5	When Pledgee disposes of the Pledge in accordance with this Agreement, Pledgor and Party C shall
provide necessary assistance to enable Pledgee to enforce the Pledge in accordance with this Agreement.

 

		8.6	Unless otherwise provided by the law, all expenses, tax, charges and all legal fees relating to
the establishment of the Pledge and enforcement of it shall be borne by the Pledgor.

 

		9.	Assignment

 

		9.1	Without Pledgee's prior written consent, Pledgor shall not have the right to assign or delegate
its rights and obligations under this Agreement.

 

		9.2	This Agreement shall be binding on Pledgor and its successors and permitted assigns, and shall
be valid with respect to Pledgee and each of its successors and assigns.

 

		9.3	At any time, Pledgee may assign any and all of its rights and obligations under the Exclusive Business
Cooperation Agreement to its designee(s) (natural/legal persons), in which case the assigns shall have the rights and obligations
of Pledgee under this Agreement, as if it were the original party to this Agreement. When the Pledgee assigns the rights and obligations
under the Exclusive Business Cooperation Agreement, upon Pledgee's request, Pledgor shall execute relevant agreements or other
documents relating to such assignment.

 

		9.4	In the event of a change in Pledgee due to an assignment, Pledgor shall, at the request of Pledgee,
execute a new pledge agreement with the new pledgee on the same terms and conditions as this Agreement.

 

		9.5	Pledgor shall strictly abide by the provisions of this Agreement and other contracts jointly or
separately executed by the Parties hereto or any of them, including the Exclusive Option Agreement and the Power of Attorney granted
to Pledgee, perform the obligations hereunder and thereunder, and refrain from any action/omission that may affect the effectiveness
and enforceability thereof. Any remaining rights of Pledgor with respect to the Equity Interest pledged hereunder shall not be
exercised by Pledgor except in accordance with the written instructions of Pledgee.

 

		10.	Termination

 

Upon the full performance and
payment of the consulting and service fees under the Exclusive Business Cooperation Agreement and upon termination of Party C's
obligations under the Control Agreements, this Agreement shall be terminated, and Pledgee shall then cancel or terminate this Agreement
as soon as reasonably practicable.

 

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Unless otherwise provided by
laws, in no event shall the Pledgor or Party C have the right to terminate or rescind this Contract.

 

		11.	Handling Fees and Other Expenses

 

All fees and out of pocket expenses
relating to this Agreement, including but not limited to legal costs, costs of production, stamp tax and any other taxes and fees,
shall be borne by Party C. If Applicable Laws requires that Pledgee should bear some related taxes and fees, Pledgor shall cause
Party C to fully repay Pledgee the paid taxes and fees.

 

		12.	Confidentiality

 

The Parties acknowledge that
any oral or written information exchanged among them with respect to this Agreement is confidential information. Each Party shall
maintain the confidentiality of all such information, and without obtaining the written consent of other Parties, it shall not
disclose any relevant information to any third parties, except in the following circumstances: (a) such information is or will
be in the public domain (provided that this is not the result of a public disclosure by the receiving party); (b) information disclosed
as required by applicable laws or rules or regulations of any stock exchange; or (c) information required to be disclosed by any
Party to its legal counsel or financial advisor regarding the transaction contemplated hereunder, and such legal counsel or financial
advisor are also bound by confidentiality duties similar to the duties in this section. Disclosure of any confidential information
by the staff members or agency hired by any Party shall be deemed disclosure of such confidential information by such Party, which
Party shall be held liable for breach of this Agreement. This section shall survive the termination of this Agreement for any reason.

 

		13.	Governing Law and Resolution of Disputes

 

		13.1	The execution, effectiveness, construction, performance, and the resolution of disputes hereunder
shall be governed by the formally published and publicly available laws of China. Matters not covered by formally published and
publicly available laws of China shall be governed by international legal principles and practices.

 

		13.2	In the event of any dispute with respect to the construction and performance of the provisions
of this Agreement, the Parties shall negotiate in good faith to resolve the dispute. In the event the Parties fail to reach an
agreement on the resolution of such a dispute within 30 days after any Party's request for resolution of the dispute through negotiations,
any Party may submit the relevant dispute to the China International Economic and Trade Arbitration Commission (“CIETAC”)
for arbitration, in accordance with its then effective arbitration rules. The arbitration shall be conducted in Beijing, and the
language used during arbitration shall be Chinese. The arbitration ruling shall be final and binding on all Parties.

 

		13.3	Upon the occurrence of any disputes arising from the construction and performance of this Agreement
or during the pending arbitration of any dispute, except for the matters under dispute, the Parties to this Agreement shall continue
to exercise their respective rights under this Agreement and perform their respective obligations under this Agreement.

 

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		14.	Notices

 

		14.1	All notices and other communications required or permitted to be given pursuant to this Agreement
shall be delivered personally or sent by registered mail, postage prepaid, by a commercial courier service or by facsimile transmission
to the address of such party set forth below. A confirmation copy of each notice shall also be sent by email. The dates on which
notices shall be deemed to have been effectively given shall be determined as follows:

 

		14.1.1	Notices given by personal delivery, by courier service
or by registered mail, postage prepaid, shall be deemed effectively given on the date of delivery or refusal at the address specified
for notices.

		 	 

		14.1.2	Notices given by facsimile transmission shall be deemed
effectively given on the date of successful transmission (as evidenced by an automatically generated confirmation of transmission).

 

		14.2	For the purpose of notices, the addresses of the Parties are as follows:

 

	Party A:	Weidai Co., Ltd.
	 	 
	Address:	50/F, Fortune Financial Center, No. 37 Jiefang East Rd., Jiangan District, Hangzhou City, Zhejiang Province.
	 	 
	Attn:	***
	 	 
	Phone:	***
	 	 
	Party B:	[Name]
	 	 
	Address:	***
	 	 
	Attn:	***
	 	 
	Phone:	***
	 	 
	Party C:	Hangzhou Yuntuo group co., LTD.
	 	 
	Address:	50/F, Fortune Financial Center, No. 37 Jiefang East Rd., Jiangan District, Hangzhou City, Zhejiang Province.
	 	 
	Attn:	***
	 	 
	Phone:	***

 

		14.3	Any Party may at any time change its address for notices by a notice delivered to the other Parties
in accordance with the terms hereof.

 

		15.	Severability

 

In the event that one or several
of the provisions of this Agreement are found to be invalid, illegal or unenforceable in any aspect in accordance with any laws
or regulations, the validity, legality or enforceability of the remaining provisions of this Agreement shall not be affected or
compromised in any respect. The Parties shall strive in good faith to replace such invalid, illegal or unenforceable provisions
with effective provisions that accomplish to the greatest extent permitted by law and the intentions of the Parties, and the economic
effect of such effective provisions shall be as close as possible to the economic effect of those invalid, illegal or unenforceable
provisions.

 

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		16.	Attachments

 

The attachments set forth herein shall be an integral
part of this Agreement.

 

		17.	Effectiveness

 

		17.1	Any amendments, changes and supplements to this Agreement shall be in writing and shall become
effective after the affixation of the signatures or seals of the Parties.

 

		17.2	This Agreement is written in Chinese and English in four (4) copies. Each of the Pledgor, Pledgee
and Party C shall hold one (1) copy, respectively; and one (1) copy shall be submitted to the Registration Authority. Each copy
of this Agreement shall have equal validity. In case there is any conflict between the Chinese version and the English version,
the Chinese version shall prevail.

 

		17.3	With the execution of this Agreement on the date hereof, the Pledgor shall cause his/her spouse
to execute and deliver to the Pledgee a spousal consent letter.

 

[The space below is intentionally left blank.]

 

    	 	Share Pledge Agreement	 

     

    

 

IN WITNESS WHEREOF, the Parties have caused
their authorized representatives to execute this Share Pledge Agreement as of the date first written above.

 

	Party A:
    Weidai Co., Ltd. (Company Seal)	 
	 	 
	By:	 
	 	 
	Name:	 

 

    	 	Share Pledge Agreement-Signature Page	 

     

    

 

IN WITNESS WHEREOF, the Parties have caused
their authorized representatives to execute this Share Pledge Agreement as of the date first written above.

 

	Party B: ***	 
	 	 
	By:	 

 

    	 	Share Pledge Agreement-Signature Page	 

     

    

 

IN WITNESS WHEREOF, the Parties have caused
their authorized representatives to execute this Share Pledge Agreement as of the date first written above.

 

	Party C: Hangzhou Yuntuo group co., LTD. (Company Seal)	 
	 	 
	By:	 
	 	 
	Name:	 

 

    	 	Share Pledge Agreement-Signature Page

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