Document:

Exhibit 4.28

 

Exclusive Option Agreement

 

The Exclusive Option Agreement (“the Agreement”) is concluded in Shanghai on September 27th, 2020 by the following both parties:

 

1.                           Shanghai Lightinthebox Information Technology Co., Ltd., a wholly foreign-owned enterprise incorporated in the PRC, registered address: Room 378, No.588, West Huanhu No. 2 Road, China (Shanghai) Pilot Free Trade Zone Lin-gang Special Area (“Sole-funded Company”);

 

2.                           Fu Qianneng, ID No.: (                   );

 

3.                           Liu Li, ID No.: (                   ); (collectively, together with Fu Qiannen, “existing shareholders”);

 

4.                           Dongguan Herui Supply Chain Management Co., Ltd., a limited liability company incorporated and validly existing under the laws of the PRC, registered address: No. 28, Middle Guanhuang Road, Gaobu Town, Dongguan City, Guangdong Province (“Domestic Company”).

 

The Sole-funded Company, each existing shareholder and the Domestic Company are referred to herein individually as “one party” and collectively as the “parties”. Whereas:

 

(1)                 The existing shareholders hold 100% equity interest of the Domestic Company in total, among which Fu Qianneng holds 40% equity of the Domestic Company and Liu Li holds 60% equity of the Domestic Company.

 

(2)                 On MM/DD/2020, the Sole-funded Company and the Domestic Company entered into the Exclusive Technical Consulting and Service Agreement (“Exclusive Technical Consulting and Service Agreement”). On the same day, the Sole-funded Company and each existing shareholder entered into the Equity Pledge Agreement (“Equity Pledge Agreement”) and a series of agreements.

 

(3)                 To the extent permitted by laws of the PRC, the existing shareholders and the Domestic Company intend to grant the Sole-funded Company and/or one or more persons designated by it the exclusive right to purchase all or part of the equity and/or assets of the Domestic Company at any time, and the Sole-funded Company intends to receive such authorization.

 

Upon consensus through negotiation, both parties reach the following agreement:

 

1.                      Purchase of equity and assets

 

1.1.         Grant of right. To the extent permitted by laws (including any laws, regulations, rules, notices, interpretations or other binding documents issued by any national or local legislative, administrative or judicial authority prior to or after the date of the Agreement, hereinafter referred to as the “laws of the PRC”) of the PRC, during the term of the Agreement, pursuant to the steps of exercise determined by the Sole-funded Company at its sole discretion and the price stipulated in Article 1.4 hereof, each existing shareholder hereby irrevocably grants the Sole-funded Company the irrevocable exclusive right (“exclusive equity option”) to purchase or designate one or more persons (the “designee”, shall be (a) Direct or indirect shareholders of the Sole-funded Company and their direct or indirect subsidiaries; (b) the Sole-funded Company, its direct or indirect shareholders and Chinese citizens among directors of their direct or indirect subsidiaries) to purchase all or part of the equity of the Domestic Company held by each existing shareholder from time to time. Except the Sole-funded Company and the designee, no third party enjoys the exclusive equity option. The Domestic Company hereby agrees to the grant of the exclusive equity option to the Sole-funded Company by the existing shareholders. “Person”, referred herein, means individual, corporation, joint venture, partnership, enterprise, trust or unincorporated organization.

 

 

To the extent permitted by laws of the PRC, during the term of the Agreement, pursuant to the steps of exercise determined by the Sole-funded Company at its sole discretion and the price stipulated in Article 1.4 hereof, the Domestic Company hereby irrevocably grants the Sole-funded Company the irrevocable exclusive right (“exclusive assets option”, collectively, together with “exclusive equity option” as “exclusive option”) to purchase or cause the designee to purchase all or part of the assets (“purchased assets”) from the Domestic Company.

 

1.2.         Exclusive right. The exclusive option is the exclusive right enjoyed by the Sole-funded Company. Without the prior written consent of the Sole-funded Company, the Domestic Company shall not sell, offer to sell, transfer, gift, pledge or otherwise dispose of the purchased equity to any other person in whole or in part, or authorize any other person to purchase all or part of the purchased equity; The Domestic Company shall not sell, offer to sell, transfer, gift, pledge or otherwise dispose of the purchased assets to any other person in whole or in part, or authorize any other person to purchase all or part of the purchased assets.

 

1.3.         Steps of exercise. The Sole-funded Company shall exercise its equity purchase option pursuant to the laws and regulations of the PRC. The Sole-funded Company may determine the time, manner, and frequency for exercising its exclusive option at its own discretion. When exercising its equity purchase option, the Sole-funded Company shall notify the existing shareholders and the Domestic Company in writing (“Equity Purchase Notice”) (in the form and content set out in Annex I hereto), describing the following: (a) The decision of the Sole-funded Company on the exercise of the option; (b) The equity that the Sole-funded Company intends to purchase from the existing shareholders (“target equity”); (c)      Purchase date/equity transfer date.

 

When exercising its assets purchase option, the Sole-funded Company shall notify the existing shareholders and the Domestic Company in writing (“Assets Purchase Notice”,  together with “Equity Purchase Notice”, collectively, hereinafter referred to as “Option Notice”) (in the form and content set out in Annex II hereto), describing the following: (a) The decision of the Sole-funded Company on the exercise of the option; (b) The assets that the Sole-funded Company intends to purchase from the existing shareholders (the “target assets”); (c) Purchase date/assets transfer date.

 

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1.4.         Purchase price. Except an assessment required by laws, when exercising the exclusive option by the Sole-funded Company, the price of the purchased equity (“equity purchase price”) shall be the minimum price allowed by laws of the PRC in force at equity transfer; The price of the purchased assets (“assets purchase price”) shall be the net book value of the purchased assets. However, if the minimum price allowed by laws of the PRC at that time is higher than the net book value of the purchased assets, the assets purchase price shall be the minimum price allowed by laws of the PRC. The Domestic Company agrees, if the total purchase price the Sole-funded Company pays for the equity or assets is over the amount which the existing shareholders invest to the Domestic Company and the Domestic Company receives the aforementioned total price, it shall return, pursuant to the request of the Sole-funded Company, the balance to the Solefunded Company or any person designated by it in a legal process.

 

1.5.         Exercise of rights. Where the Sole-funded Company exercises its exclusive option, to make the transfer of equity/assets consistent with the provisions of the Agreement and relevant laws in essence and procedure, the existing shareholders and the Domestic Company undertake to be obliged to take the following actions, individually or jointly:

 

(a)              Within seven workdays upon receipt of the purchase notice, the existing shareholders and the Domestic Company shall, in accordance with the Agreement and the Purchase Notice, make and sign all necessary documents, including the equity/assets transfer contract, with respect to the purchased equity/assets transfer, and transfer the purchased equity/assets to the Sole-funded Company and/or the designee by one time;

 

(b)              The existing shareholders shall instruct the Domestic Company to convene a shareholders’ meeting in a timely manner, at which the resolution for approving the transfer of equity/assets to the Sole-funded Company and/or the designee by the existing shareholders or the Domestic Company shall be passed;

 

(c)               With respect to the transfer of the purchased equity, if necessary, the existing shareholders and the Domestic Company shall sign the Equity Transfer Agreement (“Equity Transfer Agreement”) in the form set out in Annex III hereto. In the event of other provisions on the content and form of the Equity Transfer Agreement in laws of the PRC, laws of the PRC shall prevail. The closing (subject to the completion of registration of changes in industry and commerce by the industrial and commercial administrative department) of the purchased equity shall not be later than the fifteenth workday after the receipt of the Equity Purchase Notice by the existing shareholders and the Domestic Company, unless otherwise stipulated by each party as the case may be;

 

(d)              At the date of the Agreement, the existing shareholders and the Domestic Company shall also sign one or more Power of Attorney in the content and form set forth in Annex IV hereto, to authorize any person designated by the Sole-funded Company to sign and deliver the Equity/Assets Transfer Agreement and any other documents set forth herein on behalf of the existing shareholders and the Domestic Company;

 

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(e)               The existing shareholders and the Domestic Company shall take all necessary actions to carry out and complete the relevant approval and registration formalities without delay, to register the purchased equity/assets in the name of the Sole-funded Company and/or the designee effectively without any security interests to them. “Security interest”, referred in the Article and the Agreement, includes a warranty, guarantee, mortgage, pledge, third party right or interest, any equity option, acquisition right, preemptive right, right of set-off, retention of title or other guarantee arrangements, but does not include any security interest arising under the Agreement and the Equity Pledge Agreement (as defined below);

 

(f)                The existing shareholders and the Domestic Company shall take all necessary actions to avoid disturbing the transfer of the purchased equity/assets in essence and procedure. Except conditions expressly set forth herein, neither the existing shareholders nor the Domestic Company shall impose any impediment or restrictive condition on the transfer of the purchased equity/assets.

 

1.6.         The parties hereby agree that upon the exercise of the exclusive option by the Sole-funded Company, all transfer prices received by the existing shareholders and/or the Domestic Company for this purpose shall be paid to the Sole-funded Company or its designee for free.

 

2.                      Promises of parties

 

2.1.         Promises of the Domestic Company. The existing shareholders and the Domestic Company hereby irrevocably undertake:

 

(a)              Not to supplement, change or modify the Articles of Association of the Domestic Company in any form, increase or decrease its registered capital, or otherwise change its structure of registered capital, without the prior written consent of the Sole-funded Company or its parent company;

 

(b)              Maintain the existence of the Domestic Company and its subsidiaries in accordance with good financial and business standards and practices, operate and deal with affairs prudently and efficiently;

 

(c)               Not to sell, transfer, mortgage or otherwise dispose of the legal or beneficiary interest in the assets, business or income of the Domestic Company at any time since the date of the Agreement, or allow to set any other security interest in them, without the prior written consent of the Sole-funded Company or its parent company;

 

(d)              Not to generate, succeed, secure or allow any debt without the prior written consent of the Sole-funded Company or its parent company, however, excluding (i) Debts incurred in the normal or ordinary course of business other than by loans; and (ii) Debts that have been disclosed to and approved by the Sole-funded Company in writing;

 

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(e)               Operate all business in the normal course of business to maintain the asset value of the Domestic Company, and not to have any act / omission which is enough to affect its state of business and asset value;

 

(f)                Not to enter into any material contract (including but not limited to contracts with the value exceeding RMB 100,000) without the prior written consent of the Sole-funded Company or its parent company, excluding contracts signed in the normal course of business;

 

(g)               Not to provide any loan or credit to any person without the prior written consent of the Sole-funded Company or its parent company;

 

(h)              Provide all materials about the operation and financial situation of the Domestic Company to the Sole-funded Company as required by it;

 

(i)                  Purchase and sustain to hold the insurance from the insurance company accepted by the Sole-funded Company, and the amount and types of the insurance shall be the same as that normally insured by companies operating similar businesses and owning similar property or assets in the same region;

 

(j)                 Not to merge or combine with, or acquire or invest in any person without the prior written consent of the Sole-funded Company or its parent company;

 

(k)              Promptly notify the Sole-funded Company about any lawsuit, arbitration or administrative proceedings that have occurred or may occur in relation to the assets, business or revenue of the Domestic Company;

 

(l)                  Sign all necessary or appropriate documents, take all necessary or appropriate actions and file all necessary or appropriate complaints or make all necessary and proper defenses against all claims, to maintain the ownership of the Sole-funded Company to all assets of the Domestic Company;

 

(m)          Not to pay dividends, distributable interests and/or assets to any shareholders in any form, without the prior written consent of the Sole-funded Company or its parent company; If the existing shareholders have obtained any above interests, they shall notify the Sole-funded Company within three workdays and immediately transfer relevant interests to the Sole-funded Company for free; but the Domestic Company shall immediately distribute all distributable profits to its shareholders once required by the Sole-funded Company; and

 

(n)              Appoint the personnel designated or recognized by the Sole-funded Company as the director of the Domestic Company as required by the Sole-funded Company.

 

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2.2.         Undertakings of current shareholders. Each existing shareholder hereby irrevocably undertakes:

 

(o)              Not to supplement, change or modify the Articles of Association of the Domestic Company in any form, increase or decrease its registered capital, or otherwise change its structure of registered capital, without the prior written consent of the Sole-funded Company or its parent company;

 

(p)              Not to sell, transfer, mortgage or otherwise dispose of the legal or beneficial interest in the equity of the Domestic Company held by the existing shareholders at any time since the date of the Agreement, or allow to set any other security interest in them, without the prior written consent of the Sole-funded Company or its parent company, excluding the pledge set in the equity of the Domestic Company held by the existing shareholders in accordance with the Equity Pledge Agreement (“Equity Pledge Agreement”) signed by parties on the date of the Agreement;

 

(q)              Not to sell, transfer, mortgage or otherwise dispose of the ownership or beneficial interest in the equity at any time since the date of the Agreement, or allow to set any other security interest in it, without the prior written consent of the Sole-funded Company or its parent company, excluding any pledge on the equity of the Domestic Company in accordance with the Equity Pledge Agreement;

 

(r)                 Not to vote for or support or sign any resolution of the shareholders’ meeting of the Domestic Company approving the sale, transfer, mortgage or otherwise disposal of the legal or beneficial interest in any equity or assets, or allow to set any other security interest in them, without the prior written consent of the Sole-funded Company or its parent company, excluding the sale, transfer, mortgage or disposal to the Sole-funded Company or the designee;

 

(s)                Not to vote for or support or sign any resolution of the shareholders’ meeting of the Domestic Company approving the merger or combination of the Domestic Company with any other person, or acquisition of any person or investment in any person, or division, change of the registered capital and corporation form of the Domestic Company;

 

(t)                 Timely notify the Sole-funded Company of any lawsuit, arbitration or administrative proceedings occurred or likely to occur in relation to the equity owned by the existing shareholders;

 

(u)              Cause the shareholders’ meeting of the Domestic Company to vote for the transfer of the target equity stipulated herein;

 

(v)              Sign all necessary or appropriate documents, actively take all necessary or appropriate actions and/or file all necessary or appropriate complaints or make all necessary and proper defenses against all claims, to maintain the ownership of the target equity;

 

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(w)            Appoint the personnel designated or recognized by the Sole-funded Company as the director of the Domestic Company as required by the Sole-funded Company;

 

(x)              As required by the Sole-funded Company from time to time, unconditionally and immediately transfer its shares to the Sole-funded Company or its designated representative at any time, and waive its preemptive right to the equity transferred by other existing shareholders as above mentioned;

 

(y)              Strictly follow the Agreement and other contracts jointly or separately concluded between or among the Sole-funded Company, its parent company, the existing shareholders and the Domestic Company, perform its obligations under such contracts effectively, and not to take any act/omission that may affect the validity and enforceability of such contracts;

 

(z)               The existing shareholders irrevocably undertake to bear joint and several liabilities for obligations hereunder.

 

3.              Statements and warranties of the existing shareholders and the Domestic Company

 

The existing shareholders and the Domestic Company hereby jointly and individually state and warrant to the Sole-funded Company that, on the date of the Agreement and each equity transfer date:

 

3.1.         It has the power and capacity to sign and deliver the Agreement, and equity/assets transfer agreements (individually, “Transfer Agreement”) as a party pursuant to the Agreement for each transfer of target equity/assets, and to perform its obligations under the Agreement and any transfer agreement. Upon signing, the Agreement and each transfer agreement to which it’s a party shall constitute a legal, effective and binding obligation to it and be enforceable to it in accordance with the terms;

 

3.2.         The signing, delivery and performance of the Agreement or relevant equity/assets transfer agreement by the existing shareholders and the Domestic Company shall not:

 

(a) Conflict with, or violate the following documents or upon receipt of the relevant notice or with time: (i) Its business license, Articles of Association, permits, government approvals for its establishment, agreements relating to its establishment or any other framework documents, (ii) Other laws which are binding on it, (iii) Any contract, agreement and lease to which it is a party or which is binding on it or its assets, or other documents; (b) Cause any mortgage or other encumbrance on its assets, or enable any third party to create any mortgage or encumbrance on its assets, except pledge on the equity of the Domestic Company in accordance with the Equity Pledge Agreement; (c) Terminate or modify any terms of any contract, agreement and lease to which it is a party or which is binding on it or its assets or other documents, or enable any third party to terminate or modify terms of such documents; (d) Result in the suspension, revocation, damage, confiscation or non-renewal upon expiry of any approval, permit and registration from any government department applicable to it;

 

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3.3.         The Domestic Company has good and sellable ownership to all assets. The Domestic Company does not set any security interest to above assets;

 

3.4.         The Domestic Company has no outstanding debt, except the following: (i) debts incurred in the normal course of business, (ii) debts which have been disclosed to and agreed by the Sole-funded Company in writing, and (iii)          debts which have been disclosed to and agreed by the Sole-funded Company in writing; the existing shareholders legally and effectively own the equity of the Domestic Company held by them. Except any pledge on the equity of the Domestic Company in accordance with the Equity Pledge Agreement; the existing shareholders do not create any encumbrance on the equity of the Domestic Company;

 

3.5.         The Domestic Company complies with all applicable laws and regulations; and

 

3.6.         At present, there is no ongoing or pending or possible lawsuit, arbitration or administrative proceedings with respect to the equity, assets or other aspects of the Domestic Company.

 

The existing shareholders warrant to the Domestic Company that, it has made all proper arrangements and signed all necessary documents to ensure that, in case of death, incapacity, bankruptcy and divorce or other circumstances that may affect the exercise of shareholder rights, its successor, guardian, creditor, spouse or any other person who may obtain the equity or related rights will not affect or obstruct the performance of the Agreement.

 

The parties warrant that once the Sole-funded Company is permitted by the laws of the PRC to directly hold the equity of the Domestic Company and the Domestic Company may continue to carry out its business legally, the Sole-funded Company is entitled to immediately exercise all exclusive options.

 

4.              Confidentiality

 

Prior to and during the term of the Agreement, either party (“disclosing party”) has disclosed or may disclose confidential information (including but not limited to business information, customer information, financial data, contracts, etc.) to the other party (“receiving party”). The receiving party must keep the confidential information confidential, and shall not use it for other purposes not clearly stipulated herein, except under the following conditions: (a) the receiving party has already mastered the information, with evidence in the form of written records made prior to the disclosure by the disclosing party; (b) the information becomes public knowledge currently or in the future otherwise than through the receiving party’s breach of the Agreement; (c) the information is obtained by the receiving party from a third party having no obligation of confidentiality with respect to such confidential information; and (d) the information is disclosed by either party as required by relevant laws, rules or regulatory agencies, or be disclosed to its legal or financial advisers by either party for normal operation. If the employee or agency of either party discloses the confidentiality, it is deemed as disclosure of confidentiality of the party, and the party shall bear the responsibility for breach of contract in accordance with the Agreement. Regardless of the reason the Agreement is terminated in, this clause still remains valid.

 

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5.              Effectiveness and period of validity

 

The Agreement becomes valid on the date when it is signed by the parties.

 

The term of the Agreement is 10 years, which can be extended indefinitely, unless otherwise clearly terminated by the Sole-funded Company. Notwithstanding the foregoing, the Sole-funded Company is always entitled to dissolve the Agreement through notice to the existing shareholders and Domestic Company in writing with 30 days in advance, without taking the liability for breach of contract in respect of its unilateral dissolution of the Agreement.

 

6.              Termination

 

6.1.         Termination at expiry. Unless extended according to relevant clauses of the Agreement, the Agreement is terminated at expiry.

 

6.2.         Termination in advance. During the term of the Agreement, the existing shareholders and the Domestic Company shall not terminate the Agreement in advance, unless under the condition of gross negligence, fraud, other illegal acts or bankruptcy or dissolution or termination according to laws of the Sole-funded Company; The Agreement shall be terminated automatically if the Sole-funded Company is bankrupt or dissolved legally before the expiry of the Agreement. Notwithstanding the foregoing, the Sole-funded Company is always entitled to terminate the Agreement through sending written notice to the other party 30 days in advance at any time.

 

6.3.         Clauses after termination. Any obligations incurred or due under the Agreement prior to termination at expiry or in advance of the Agreement shall survive. After the Agreement is terminated, the rights and obligations of the parties under Article 4, Article 11.5 and Article 11.8 will remain valid.

 

7.              Liability for breach of contract and compensation

 

7.1.         Liability for breach of contract. The parties agree and confirm that, if either party (“default party”) materially breaches any covenant made hereunder, or materially fails or delays in performing any obligations hereunder, it shall constitute a default hereunder (“default”); either non-defaulting party (“observant party”) is entitled to require the default party to rectify or take remedial measures within a reasonable time. If the default party fails to rectify or take remedial measures within a reasonable time or ten (10) days upon receipt of the written notice from the other party making a request for rectification, the observant party is entitled to claim damages from the default party.

 

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7.2.         Compensation. The existing shareholders and the Domestic Company shall compensate the Sole-funded Company for any loss, damage, obligation and/or expense due to any lawsuit, claim or other requests against the Sole-funded Company arising or resulting from the execution of the Agreement, and shall and hold the Sole-funded Company harmless from and against any damage and loss caused by the behaviors of the shareholders or the Domestic Company or any request from any third party due to the behaviors of the existing shareholders and the Domestic Company.

 

8.              Governing laws and dispute resolution

 

8.1.         Governing laws. The conclusion, validity, interpretation and performance of the Agreement as well as resolution of disputes arising therefrom shall be governed by laws of the PRC.

 

8.2.         Dispute resolution. Any dispute generated by interpretation and performance of the Agreement is solved by the parties firstly through friendly negotiation. If it cannot be solved within thirty (30) days after one party receives the written notice on negotiated settlement from the other party, either party can submit the dispute to China International Economic and Trade Arbitration Commission for arbitration in accordance with its arbitration rules in force. The arbitration place is Beijing. The arbitration award is final and has binding effect on the parties.

 

8.3.         During the arbitration, except the dispute matters or obligations submitted for arbitration, the parties shall continue the performance of other obligations under the Agreement. The arbitrator is entitled to make appropriate award based on the actual situation to grant appropriate legal relief to the Sole-funded Company, including restricting the business operation of the Domestic Company, restricting by the existing shareholders, prohibiting or ordering a transfer or disposal of the equity or assets of the Domestic Company held by the existing shareholders, and requiring the existing shareholders to conduct the liquidation of the Domestic Company.

 

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8.4.         At the request of the disputing party, a competent court is entitled to grant provisional relief, such as award or order to detain or freeze the properties or equity of the default party. After the arbitration award takes effect, either party is entitled to apply to a court with jurisdiction for the enforcement of the award. In addition to courts in China Mainland, courts in Hong Kong and the Cayman Islands shall also have the jurisdiction for the above purposes.

 

9.              Change in law

 

9.1.         After the effectiveness of the Agreement, in case of any modification to any national or local laws, rules, regulations or other normative documents by any national or local legislative or administrative agencies, including any amendment, supplement or abolishment, interpretation or enactment of implementation measures or rules (collectively, “amendment”), or enactment of new laws, rules, regulations or other normative documents (collectively, “new regulations”), the following shall be applicable:

 

9.2.         If the amendment or new regulations is more favorable to any party (the other party is not seriously and adversely affected by it) than laws, rules, regulations or other normative documents in force on the effectiveness date of the Agreement, the parties shall apply to relevant agencies (if required) for the benefit from the amendment or new regulations. The parties shall make best efforts to facilitate the approval of the application.

 

9.3.         If the amendment or new regulations has direct or indirect serious adverse effects on the economic interests of the Sole-funded Company hereunder, and the parties fail to solve it in accordance with the Agreement, upon receiving the notice from the Sole-funded Company, the parties shall make all necessary modifications to the Agreement through negotiation to maintain the economic interests of the Sole-funded Company hereunder to the greatest extent.

 

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10.       Force majeure

 

10.1.           “Force majeure event” refers to any event which is out of the reasonable control of one party and is unavoidable with the reasonable care of the affected party, including but not limited to: government actions, forces of nature, fire, explosion, geographical changes, storms, floods, earthquakes, tides, lightning or wars. However, any shortage of credit, fund or financing shall not be regarded as an event which is out of the reasonable control of one party. If the performance of the Agreement is delayed or obstructed due to any force majeure event, the affected party shall not be liable to the other party hereunder with respect to the delayed or obstructed part. If the affected party seeks to be exempted from its duties under the Agreement or any terms hereof, it shall promptly notify the other party the exemption and all steps necessary for completing the performance.

 

10.2.           The affected party shall be exempted from any liability hereunder arising therefrom. The party seeking an exemption can be exempted from the liability, provided that the affected party has taken all reasonable and practicable efforts to perform the Agreement. And the exemption is only limited to the performance delayed or obstructed. Once the reason for exemption from liability is corrected and remedied, the parties agree to take their best efforts to resume the performance hereunder.

 

11.       Others

 

11.1.           Notice. Unless the change of the following address is notified in writing, the notice hereunder shall be served to the following address by hand, fax or registered post. If sent by registered post, the service of the notice shall be deemed to be effected on the date recorded in the return receipt; if sent by hand or fax, the service of the notice shall be deemed to be effected on the date of proper sending. If the notice is sent by fax, the original shall be served to the following address by registered mail or by hand as soon as it is sent:

 

Sole-funded Company: Shanghai Lightinthebox Information Technology Co.,  Ltd.

 

Address: Floor 5, Building 2, Yaxin Science & Tech Park, No.399, Shengxia Road, Pudong New Area, Shanghai

 

Tel./Fax: 

 

Addressee: Fu Qianneng

 

Domestic Company: Dongguan Herui Supply Chain Management Co., Ltd.

 

Address: Floor 5, Building 2, Yaxin Science & Tech Park, No.399, Shengxia Road, Pudong New Area, Shanghai

 

Tel./Fax: 

 

Addressee: Fu Qianneng

 

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11.2.           Further warranty. The parties agree to rapidly sign the documents reasonably required for or beneficial to the execution of all provisions and purposes of the Agreement, and take all further actions reasonably required for or beneficial to the execution of all provisions and purposes of the Agreement.

 

11.3.           Entire contract. Except further written amendments, supplements or modifications after the date of the Agreement, the Agreement shall constitute the entire contract between the parties regarding the subject matter hereof and shall supersede all previous negotiations, statements and contracts between the parties regarding the subject matter hereof, whether oral or written.

 

11.4.           Headings. The headings used herein are for convenience only and are not used to interpret, state or otherwise affect the meaning of the provisions hereof.

 

11.5.           Taxes and dues. Each party shall be liable for any and all transfer and registration taxes, costs and expenses incurred or levied in connection with the preparation and execution of the Agreement and each transfer contract and the consummation of the transactions contemplated by the Agreement and each transfer contract.

 

11.6.           Transfer of the Agreement. During the term of the Agreement, no party shall transfer part of or all of its rights and/or obligations hereunder to any third party without the prior written consent of the other party, except transfer by the Sole-funded Company to its affiliates.

 

11.7.           Severability of the Agreement. If one or several provisions of the Agreement are judged as invalid, illegal or unenforceable in any aspect according to any law or regulation, the validity, legality and enforceability of the remaining provisions of the Agreement shall not be affected or impaired in any aspect. The parties shall make effort to replace the invalid, illegal or unenforceable provisions with valid provisions through sincere consultation. The economic effect generated by such valid provisions shall be similar with that generated by invalid, illegal and unenforceable provisions to the greatest extent.

 

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11.8.           Waiver. The waiver of any terms and conditions hereunder by either party can only be effective in written form upon the signature of the parties. The waiver by either party due to the breach of the other party under some circumstances shall not be deemed as its waiver of similar breaches of contract of the other party under other circumstances. Either party’s failure to exercise or delay in exercising any right hereunder shall not constitute its waiver thereof, and any exercise or partial exercise of any right shall not preclude the exercise of such right again in the future.

 

11.9.           Modification and supplement of the Agreement. The parties shall make modifications and supplements to the Agreement in written agreement. The modification agreements and supplementary agreements to the Agreement which are properly signed by the parties are part of the Agreement, with the same legal force.

 

11.10.    Succession and assignment of the Agreement. The Agreement shall be binding on the successors and permitted assignees of the parties.

 

11.11.    Language. The Agreement shall be made in multiple copies in Chinese.

 

11.12.    Agreement text. The Agreement shall be in Chinese and be in sextuplicate, with each party holding one.

 

[There is no text below on this Page]

 

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(There is no text on this Page)

 

For the above purpose, the parties have signed the Agreement on the date first shown above.

 

Shanghai Lightinthebox Information Technology Co., Ltd. (Sealed)

 

	
/s/ Fu   Qianneng
    	
 
    
	
Fu Qianneng
    	
 
    

Position: Legal representative

 

The existing shareholder: Fu Qianneng

 

	
/s/ Fu   Qianneng
    	
 
    
	
 
    	
 
    

The existing shareholder: Liu Li

 

	
/s/ Liu Li
    	
 
    
	
 
    	
 
    

Domestic Company: Dongguan Herui Supply Chain Management Co., Ltd.

	
/s/ Liu Li
    	
 
    
	
Liu Li
    	
 
    

Position: Legal representative

 

Signature page of the Exclusive Option Agreement

 

 

Annex I

 

Equity Purchase Notice

 

To Fu Qianneng, Liu Li

 

The Exclusive Option Agreement was concluded on September 27th, 2020 by and between Fu Qianneng, Liu Li and the Company. Terms used herein shall have the same meaning as those defined in the Agreement.

 

The Company has decided to exercise the exclusive equity option set forth in the Exclusive Option Agreement, and hereby requests the Company/ [          ] [name of the company/person] designated by the Company to purchase 40% and 60% of the earnings on equity of Dongguan Herui Supply Chain Management Co., Ltd. held by Fu Qianneng and Liu Li, respectively. Fu Qianneng and Liu Li shall complete the closing of the purchased equity in accordance with the Exclusive Option Agreement within fifteen workdays upon receipt of the notice.

 

Shanghai Lightinthebox Information Technology Co., Ltd. (Sealed)

 

Date: [MM/DD/YY]

 

 

Annex II

 

Assets Purchase Notice

 

To Dongguan Herui Supply Chain Management Co., Ltd.

 

The Exclusive Option Agreement was concluded on September 27th, 2020 by and between Fu Qianneng, Liu Li and the Company. Terms used herein shall have the same meaning as those defined in the Agreement.

 

The Company has determined to exercise the exclusive equity option set forth in the Exclusive Option Agreement, and hereby requests the Company/ [          ] [name of the company/person] as the designee designated by the Company to purchase all assets (“assets to be assigned”) of your Company as listed in the list attached. Your Company shall transfer all assets to be assigned to the Company/[name of the designated company/person] in accordance with the Exclusive Option Agreement upon receipt of the notice.

 

Shanghai Lightinthebox Information Technology Co., Ltd. (Sealed)

 

Date: [MM/DD/YY]

 

 

Annex III

 

Equity Transfer Agreement

 

The Equity Transfer Agreement (“the Agreement”) was concluded by the following parties on [MM/DD/YY]:

 

Transferor: Fu Qianneng

 

ID No.: (               )

 

Address:

 

Transferor: Liu Li

 

ID No.: (               )

 

Address:

 

Assignee: [Shanghai Lightinthebox Information Technology Co., Ltd. or its designated assignee]

 

Registration No.:

 

Address:

 

The parties agreed as follows:

 

1.             Fu Qianneng and Liu Li agree to sell, in the minimum price allowed by laws of the PRC, and the assignee agrees to purchase 40% and 60% equity (hereinafter referred to as “purchased equity”) of Dongguan Herui Supply Chain Management Co., Ltd. held by Fu Qianneng and Liu Li respectively, under the same conditions.

 

2.             After the transfer of above purchased equity, the transferors shall not enjoy any right in the purchased equity and the assignee shall enjoy all rights of the transferors in the purchased equity.

 

3.             The effectiveness, interpretation, performance and dispute resolution of the Agreement shall be governed by laws of the PRC. Matters not covered herein and all disputes arising from the execution and performance of the Agreement shall be solved by the parties in accordance with the provisions of the Exclusive Option Agreement or through friendly negotiation. If the negotiation fails within 30 days after the raising of the dispute, each party is entitled to file the dispute to [China International Economic and Trade Arbitration Commission] for arbitration in accordance with its arbitration rules in force. The arbitration shall be conducted by three arbitrators in [Beijing] The arbitration party and the respondent shall each designate an arbitrator, and the third arbitrator shall be designated by China International Economic and Trade Arbitration Commission. If the number of the arbitration party or the respondent exceed two persons (natural person or legal person), they shall designate an arbitrator upon consensus through negotiation. The arbitration award is final and has binding effect on the parties. During the arbitration, except the dispute matters or obligations submitted for arbitration, the parties shall continue the performance of other obligations under the Agreement. The arbitrators is entitled to make appropriate award based on the actual situation to grant appropriate legal relief to the assignee, including restricting the business operation of Dongguan Herui Supply Chain Management Co., Ltd., restricting and prohibiting the transfer or disposal of the equity or assets of Dongguan Herui Supply Chain Management Co., Ltd. held by the transferor, and requiring the transferors to liquid Dongguan Herui Supply Chain Management Co., Ltd.

 

 

4.             At the request of the assignee, a competent court is entitled to grant provisional relief, such as award or order to detain or freeze the properties or equity of the default party. After the arbitration award takes effect, either party is entitled to apply for enforcement to a court with jurisdiction. In addition to courts in China Mainland, courts in China Hong Kong and the Cayman Islands shall also have the jurisdiction for the above purposes.

 

5.             The Agreement shall become effective from date when the parties sign it.

 

Transferor:

 

	
/s/ Fu   Qianneng
    	
 
    
	
Fu Qianneng
    	
 
    

 

	
/s/ Liu Li
    	
 
    
	
Liu Li
    	
 
    

 

Assignee:

 

[Shanghai Lightinthebox Information Technology Co., Ltd. or its designated assignee]

 

Signature of legal representative or authorized representative:

 

 

Annex IV

 

Irrevocable Power of Attorney (I)

 

I hereby issue the Power of Attorney in accordance with the Exclusive Option Agreement concluded by and between me, Shanghai Lightinthebox Information Technology Co., Ltd. and Dongguan Herui Supply Chain Management Co., Ltd. on September 27th, 2020.

 

I hereby irrevocably entrust and authorize [             ] (hereinafter referred to as “agency”) to act as my general agency for: (1) preparing and signing the Equity Transfer Agreement (as defined in the Exclusive Option Agreement); (2) preparing and signing all other necessary documents in connection with the transfer of the purchased equity (as defined in the Exclusive Option Agreement); (3) handling the approval, registration and other legal formalities in connection with the transfer of the purchased equity.

 

I hereby agree and recognize that the agency has the full authority to exercise the right to the extent of above authorization in such manner as the agent thinks fit, and I undertake to bear the duties or obligations arising from the exercise of such rights by the agency.

 

The Power of Attorney comes into effect with my signature and remains valid during the term of the Exclusive Option Agreement.

 

Hereby entrust.

 

	
/s/ Fu   Qianneng
    	
 
    
	
Fu Qianneng
    	
 
    

 

Date: [MM/DD/YY]

 

 

Annex IV

 

Irrevocable Power of Attorney (II)

 

I hereby issue the Power of Attorney in accordance with the Exclusive Option Agreement concluded by and between me, Shanghai Lightinthebox Information Technology Co., Ltd. and Dongguan Herui Supply Chain Management Co., Ltd. on September 27th, 2020.

 

I hereby irrevocably entrust and authorize [          ] (hereinafter referred to as “agency”) to act as my general agency for: (1) preparing and signing the Equity Transfer Agreement (as defined in the Exclusive Option Agreement); (2) preparing and signing all other necessary documents in connection with the transfer of the purchased equity (as defined in the Exclusive Option Agreement); (3) handling the approval, registration and other legal formalities in connection with the transfer of the purchased equity.

 

I hereby agree and recognize that the agency has the full authority to exercise the right to the extent of above authorization in such manner as the agent thinks fit, and I undertake to bear the duties or obligations arising from the exercise of such rights by the agent.

 

The Power of Attorney comes into effect with my signature and remains valid during the term of the Exclusive Option Agreement.

 

Hereby entrust.

 

	
/s/ Liu Li
    	
 
    
	
Liu Li
    	
 
    

 

Date: [MM/DD/YY]Exhibit 4.29

 

Equity Pledge Agreement

 

The Equity Pledge Agreement (hereinafter referred to as “the Agreement”) is signed by the following both parties in Shanghai on September 27th, 2020:

 

1.                 Pledgee: Shanghai Lightinthebox Information Technology Co., Ltd.

 

Registered address: Room 378, No.588, West Huanhu No. 2 Road, China (Shanghai) Pilot Free Trade Zone Lin-gang Special Area.

 

2.                 Pledgor: Fu Qianneng, ID No.: (                   )

 

3.                 Domestic Company: Dongguan Herui Supply Chain Management Co., Ltd

 

Registered address: No. 28, Middle Guanhuang Road, Gaobu Town, Dongguan City, Guangdong Province

 

Whereas:

 

(1)        The pledgor holds 40% equity of the Domestic Company, and there is no any pledge or any other encumbrance on its equity currently;

 

(2)        The pledgee is a wholly foreign-owned enterprise incorporated in the PRC. The pledgee and pledgor entered into the Exclusive Technical Consulting and Service Agreement (hereinafter referred to as the “Service Agreement”) on September 27th, 2020; the pledgee, the Domestic Company and the pledgor entered in to the Exclusive Option Agreement (“Exclusive Option Agreement”); the pledgor issues the Power of Attorney to the pledgee. The Exclusive Technical Consulting and Service Agreement, Exclusive Option Agreement and Power of Attorney above are collectively referred to as the “transaction documents”.

 

(3)        As the guarantee for the pledgor and the Domestic Company performing all contractual obligations (as defined below) hereunder, the pledgor shall provide the pledge guarantee to the pledgee with all equity of the Domestic Company held by it.

 

Upon consensus through negotiation, both parties reach the following agreement:

 

1.                       Definitions

 

Unless otherwise stipulated herein, the words used herein are defined as follows:

 

1.1                              Contractual obligations: refers to all obligations and responsibilities of the pledgor under the transaction documents and the statements, undertakings and warranties made under the transaction documents, as well as all obligations and responsibilities of the Domestic Company under the transaction documents and the statements, undertakings and warranties made under the transaction documents;

 

1.2                              Guaranteed debt: refers to the all direct and indirect and predictable loss of benefit suffered by the pledgee due to any default of the pledgor and/or the Domestic Company; and the costs incurred by the pledgee for forcing the pledgor and/or Domestic Company to perform their contractual obligations and realize the pledge.

 

1.3                               Pledge right: refers to the term set forth in Article 2.1 of the Agreement.

 

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1.4                               Pledged equity: refers to all equity of the Domestic Company legally held by the pledgor.

 

1.5                               Term of pledge: refers to the term set out in Article 4.1 of the Agreement.

 

1.6                               Event of default: refers to any circumstances set out in Article 8.1 of the Agreement.

 

1.7                               Notice of default: refers to the notice of default sent by the pledgee pursuant to the Agreement.

 

2.                       Pledge

 

Pursuant to the terms and conditions of the Agreement, the pledgee and the pledgor agree that the pledgor shall pledge its pledged equity to the pledgee as the guarantee for the full performance of the contractual obligations.

 

The pledgor and the Domestic Company shall make best effort to complete the registration formalities of the equity pledge hereunder in the industry and commerce administration authority, and to maintain the equity pledge registration effective continuously.

 

3.                       Pledge right

 

3.1             The pledgor shall pledge all equity of the Domestic Company held by it to the pledgee, as the guarantee for the pledgor and the Domestic Company performing all contractual obligations under the transaction documents.

 

3.2             The pledged equity guarantee covers all service fees, liquidated damages (if any), compensation and expenses for pledge right (including but not limited to attorney fees, arbitration fees, appraisal and auction fees of the pledged equity) payable to the pledgee.

 

3.3             The pledge right refers to right of the pledgee to be paid in priority with the income from the discount, auction or sale of the equity pledged to it by the pledgor.

 

4.                       Term of pledge

 

4.1             The Agreement shall come into effect upon registration of the equity pledge in the register of shareholders of the Domestic Company. The validity period of the pledge is the same as the maximum validity period of all contracts under the transaction documents.

 

4.2             The pledge right hereunder is effective from the pledge registration of the pledged equity in the industry and commerce administration department to the full repayment of the secured debts. Within 30 days since the date of the Agreement, pursuant to relevant laws and regulations of the PRC, the pledgor shall apply to the industry and commerce administration authority at the place where the Domestic Company is located for the registration of the pledge matters.

 

4.3             During the term of pledge, if the Domestic Company or the pledgor fails to fully perform all contractual obligations or in the event of any default set forth in Article 8.1, the pledgee is entitled to dispose of the pledge right in accordance with the provisions of the Agreement and relevant laws and regulations of the PRC.

 

5.                       The custody of the pledge certificate and the earnings from the pledged equity

 

5.1                   During the term of pledge stipulated herein, the Pledgor shall or cause the Domestic Company to execute the investment certificate (as the Annex I hereto) and the register of shareholders, deliver the above duly executed documents and the certificate of pledge registration issued by the industry and commerce administration authority to the pledgee for keeping during the term of pledge stipulated herein.

 

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5.2                   During the validity period of the Agreement, the pledgee is entitled to collect all earnings (if any) from the pledged equity, including but not limited to bonus, dividends and other cash and all non-cash earnings from the pledged equity.

 

6.                       Representations and warranties of the pledgor

 

6.1                                The pledgee is entitled to exercise, dispose of or transfer the pledge right in the manner specified herein.

 

6.2                                The pledgor individually and jointly represents, warrants and undertakes to the pledgee that:

 

6.2.1                     It has the full authority to conclude the Agreement and perform the obligations under the Agreement; it has granted its authorized representative the power to sign the Agreement. The terms of the Agreement shall be legally binding upon it since the effective date of the Agreement.

 

6.2.2                     As the legal owner of the pledged equity, the pledgor is entitled to pledge the pledged equity to the pledgee; the exercise of the pledge right by the pledgee will not be obstructed legally or actually.

 

6.2.3                     The Domestic Company is a limited liability company duly incorporated and validly existing under the laws of the PRC, duly registered in the industry and commerce administration department, and has passed all annual inspections. The registered capital of the Domestic Company is RMB 500,000.

 

6.2.4                     Its execution, delivery and performance of the Agreement will not:

 

(a)           Conflict with, or violate the following documents or upon receipt of the relevant notice or with time: (i) its business license, Articles of Association, permits, government approvals for its establishment, contracts relating to its establishment or any other framework documents, (ii) other laws which are binding on it, (iii) any contract to which the pledger and the Domestic Company are parties or which is binding on them or their assets, or other documents;

 

(b)            Create any pledge or other encumbrances to its assets or enable any third party to set any pledge or other encumbrances to its assets;

 

(c)             Terminate or modify any terms of any contract to which the Domestic Company is a party or which is binding on it or its assets or other documents, or enable any third party to terminate or modify terms of such documents;

 

(d)            Result in the suspension, revocation, damage, confiscation or non-renewal upon expiry of any approval, permit and registration from any government department applicable to it.

 

6.2.5                     Except the pledge of the pledgor hereunder, there is no mortgage, pledge or other forms of guarantee, priority, legal mortgage right, property preservation measures, seizure, custody, lease right, option or other forms of encumbrance (collectively, “encumbrance”) to the pledged equity hereunder on the effective date of the Agreement.

 

6.2.6                     Each pledgor may accept the equity of the Domestic Company held by other pledgors or subscribe the increased registered capital of the Domestic Company with the prior written consent of the pledgee. The equity accepted or the increased registered capital subscribed by the pledgor shall be covered in the pledged equity. After the pledgor accepts the equity or completes the capital increase of the Domestic Company, the pledgor and the Domestic Company shall be responsible for registering the changed equity pledge in the register of shareholders of the Domestic Company, and handle the equity pledge registration formalities in relevant industry and commerce registration authorities.

 

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6.2.7                     Timely notify the pledgee events which may affect the its right to the equity or its any part, or the notice received in connection with this; and events which may affect any warranty and obligation set by the pledgor for change of the Agreement, or the notice received in connection with this.

 

6.2.8                     For relevant certificates, licenses, authorizations and other legal documents necessary for the pledgee disposing of the pledged equity in accordance with the Agreement, it shall unconditionally provide or ensure the availability of above documents and give all kinds of convenience; the pledgor guarantees that, once the pledged equity is transferred to the pledgee or its designated beneficiary, the pledgor and/or Domestic Company will unconditionally fulfill all formalities required by laws, to enable the pledgee or its designated beneficiary to obtain the equity of the Domestic Company legally and effectively, including but not limited to the issuance of relevant documentary evidence, the signing of the equity transfer agreement and other relevant documents.

 

6.2.9                     It undertakes to the pledgee that the pledgor will follow and perform all warranties, undertakings, contracts, statements and conditions for the benefit of the pledgee. If the pledgor fails to perform or fully perform its warranties, undertakings, contracts, statements and conditions, the pledgor shall compensate the pledgee for all losses arising therefrom.

 

6.2.10              The pledger warrants to the pledgee that, it has made all proper arrangement and signed all necessary documents to ensure that, in case of death, incapacity, bankruptcy and divorce or other circumstances that may affect the exercise of equity, its successor, guardian, creditor, spouse or persons who may obtain the equity or related rights will not affect or obstruct the performance of the Agreement.

 

7.                       Undertakings of the pledgor

 

7.1                               During the term of the Agreement, the pledgor undertakes to the pledgee that it shall:

 

7.1.1                     Except the transfer of the equity to the pledgee or its designated personnel in accordance with the Exclusive Option Agreement, without the prior written consent of the pledgee:

 

A.               Not transfer the equity, or establish or allow the existence of any pledge or other forms of guarantee which may affect the rights and interests of the pledgee;

 

B.                Not take any acts which have reduced or may reduce the value of the pledged equity, or endanger the validity of the pledge hereunder. In case of obvious decrease in the value of the pledged equity which is sufficient to endanger the right of the pledgee, the pledgor shall immediately notify the pledgee and provide other properties satisfactory to the pledgee as guarantee upon the reasonable request of the pledgee, and take necessary actions to solve the above events or reduce the adverse effects. The pledgor further warrants that, during the validity period of the Agreement, the operation of the Domestic Company shall comply with laws of the PRC in all material aspects and maintain the continuous validity of all business licenses and qualifications of the Domestic Company.

 

7.1.2                     Comply with and implement provisions of relevant laws and regulations with respect to the pledge of rights, submit the notices, instructions or suggestions from or made by relevant competent authorities with respect to the pledge right to the pledgee within five days upon receipt, comply with above notices, instructions or suggestions, or make objections and statements in respect of the above matters at the reasonable request of the pledgee or with the consent of the pledgee;

 

7.1.3                     Timely notify the pledgee events which may affect the pledged equity or its any part of rights, or the notice received in connection with this; and any events that may change any warranty, obligations of the pledgor under the Agreement or may affect the performance of the pledgor’s obligations under the Agreement, or the notice received in connection with this.

 

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7.2                                The pledgor agrees that, the right for the pledgee exercising its pledge right it obtained under the Agreement shall not be interrupted or obstructed by the pledgor or its successor or principal or any other persons through legal procedures.

 

7.3                                The pledgor warrants to the pledgee that, to protect or perfect the security interest of the pledgee hereunder, the pledgor will sign in good faith and cause other parties which have interests in the pledge right to sign all certificates of rights and covenants required by the pledgee, and/or perform and cause other parties which have interests to perform actions required by the pledgee, provide convenience for the exercise of rights and authorizations granted to the pledgee hereunder, sign all change documents in connection with equity certificates with the pledgee or its designated person (natural person/legal person), and provide the pledgee with all notices, orders and decisions related to the pledge right as the pledgee thinks necessary within a reasonable period.

 

7.4                                The pledgor warrants to the pledgee that the pledgor will follow and perform all warranties, undertakings, contracts, statements and conditions for the benefit of the pledgee. If the pledgor fails to perform all or part of its warranties, undertakings, contracts, statements and conditions, the pledgor shall compensate the pledgee for all losses arising therefrom.

 

7.5                                The pledgor warrants to the pledgee that, the pledgor and other shareholders shall be jointly and severally liable for the obligations hereunder.

 

7.6                                Due to the equity transfer caused by the exercise of pledge by the pledgee, the pledgor irrevocably agrees to waive the preemptive right to the pledge the pledged equity to the pledgee by other shareholders of the Domestic Company.

 

8.                       Event of default

 

8.1                                  The following events shall be deemed as events of default:

 

8.1.1                     The pledgor or the Domestic Company fails to perform all of its contractual obligations pursuant to the transaction documents;

 

8.1.2                     There is material misrepresentation or error in any representations or warranties made by the pledgor set forth in Article 6 hereof, and/or the pledgor violates the representations and warranties set forth in Article 6 hereof;

 

8.1.3                     The pledgor violates the undertakings set forth in Article 7 hereof;

 

8.1.4                     The pledgor violates any terms of the Agreement;

 

8.1.5                     Except as stipulated in Article 7.1.1 hereof, the pledgor waives the pledged equity or transfers or otherwise disposes of the pledged equity without the written consent of the pledgee;

 

8.1.6                     Any external loan, guarantee, indemnity, undertaking or other repayment liabilities of the pledgor (1) is required to be repaid or performed in advance due to default; or (2) has become due but cannot be repaid or performed on time, resulting in that the pledgee believes that the pledgor’s capacity to perform its obligations hereunder has been affected;

 

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8.1.7                     The pledgor is incapable to pay general debts or other debts;

 

8.1.8                     The Agreement is illegal or the pledgor cannot continuously perform its obligations hereunder duet to the enactment of relevant laws and regulations;

 

8.1.9                     Any governmental consents, licenses, approvals or authorizations necessary for the performance, legality or validity of the Agreement is revoked, suspended, invalid or materially modified;

 

8.1.10              The pledgee believes that the pledgor’s capacity for performing its obligations hereunder is affected due to adverse changes to the assets owned by the pledgor;

 

8.1.11              The successor or the custodian of the Domestic Company can only perform partial or refuses to perform the payment liability under the service agreement;

 

8.1.12              Other circumstances under which the pledgee is incapable to dispose of the pledge right in accordance with relevant laws.

 

8.2                              The pledgor shall immediately notify the pledgee in writing if it is aware of or finds the occurrence of any matters set forth in Clause 8.1 or the events that may result in above matters.

 

8.3                              Unless the events of default set forth in Clause 8.1 are perfectly solved under the conditions to the satisfactory of the pledgee, the pledgee can send a default notice to the pledgor at or after the occurrence of the events of default, requiring the pledgor to immediately pay all debts and other amounts payable under the service agreement or exercise the pledge right pursuant to Article 9 hereof.

 

9.                       Exercise of pledge right

 

9.1                              In case of the pledgor’s breach or non-performance of any contractual obligations, the pledgee is entitled to dispose of all or part of pledged equity held by any shareholder (regardless whether the shareholder is in violation of the contractual obligations) of the Domestic Company, and to pay the expense set forth in Clause 3.2 with the price from the disposal of the pledged equity in priority.

 

9.2                              Prior to the full performance of contractual obligations, the pledgor shall not waive, transfer or otherwise dispose of the pledged equity without the written consent of the pledgee.

 

9.3                                 When exercising the pledge right, the pledgee shall give a written default notice to the pledgor.

 

9.4                                Subject to Article 10, the pledgee may dispose of the pledge right while giving the default notice in accordance with Article 10 or at any time after giving the default notice.

 

9.5                                Subject to Clause 8.3, the pledgee may excise its rights while giving the default notice in accordance with Article 8.3 or at any time after giving the default notice.

 

9.6                                In the event of the pledgor’s any breach or non-performance of any contractual obligation, the pledgee is entitled to discount all or part of the pledged equity hereunder in accordance with legal procedures, or be paid in priority with the income from the auction and sales of the equity until all secured debts are paid off.

 

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9.7                                While the pledgee exercising the pledge right pursuant to the Agreement, the pledgor shall not set an obstacle and shall provide necessary assistance, to help the pledgee achieve the pledge right.

 

9.8                                Amounts from exercising the pledge right by the pledgee shall be disposed of based on the following orders: firstly, pay all expenses (including the remuneration for the attorneys and agents) incurred in connection with the disposal of the pledged equity and the exercise of the rights and powers by the pledgee; secondly, pay taxes payable due to the disposal of the pledged equity; thirdly, repay the secured debts to the pledgee. For the balance after deducting above amounts, the pledgee shall return it to the pledgor or deposit it to those to whom the amount is entitled in accordance with relevant laws and regulations or the notary office in the place where the pledgee is located (the pledgor shall bear all expenses arising therefrom). If the amount from the discount, auction or sale of the pledged equity is insufficient to repay the secured debt, the pledgor shall pay off the insufficient part.

 

10. Liability for breach of contract and compensation

 

10.1                         Liability for breach of contract. Unless otherwise provided in the Agreement, both parties agree and confirm that if either party (“default party”) fails to perform any of its obligations hereunder or otherwise violates the Agreement, i.e., constituting a breach of the Agreement (“breach”), then the other party (“observant party”) is entitled to:

 

(a)                                  Send written notice to the default party, describing default nature and range and requiring default party to make remedy at its own expense within proper period specified in the notice (“remedy period”); and

 

(b)                                  If the default party fails to remedy the breach within the remedy period, the aggrieved party is entitled to require the default party to bear all liabilities arising from the breach, and to compensate the aggrieved party for all actual economic losses incurred, including but not limited to the attorney fees, legal fees or arbitration fees incurred for the lawsuit or arbitration proceedings relating to such breach. In addition, the aggrieved party is entitled to require the default party to actually perform the Agreement. The aggrieved party is also entitled to request an order from relevant arbitration agency or court for the actual performance and/or enforcement of terms agreed herein. The exercise of the above relief rights by the aggrieved party shall not prejudice its exercise of other relief rights in accordance with the Agreement and laws.

 

10.2                         Compensation. The pledgor shall fully compensate the pledgee with any loss, damage, obligation and/or expenses incurred by any lawsuit, claim or other requests against the pledgee arising from or caused by the performance of the Agreement, and protect the pledgee from any damage and loss of the pledgee arising from the pledgor’s behavior or any third party’s request in connection with the behavior of the pledgor.

 

11. Transfer

 

11.1                         The pledgor is not entitled to grant or transfer its rights and obligations hereunder without the prior consent of the pledgee.

 

11.2                         The Agreement is binding on the pledgor and its successors, and is valid to the pledgee and any of its successor and assignee.

 

11.3                         The pledgee may transfer any or all of its rights and obligations hereunder to its designated person (natural person/legal person) at any time. In such case, the assignee shall enjoy and undertake the rights and obligations enjoyed and undertaken the pledgee hereunder as if it is a party to the Agreement. When pledgee transfers its rights and obligations hereunder, at the request of the pledgee, the pledgor shall sign relevant agreements and/or documents for this transfer.

 

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11.4                         During the term of the Agreement, the pledgor shall not transfer part of or all its rights or obligations hereunder to any third party without the prior written consent of the pledgee. However, the pledgee is entitled to transfer part of or all its rights and obligations hereunder.

 

11.5                          In case of the change of the pledgee due to the transfer, the new pledgor and pledgee shall enter into a new pledge agreement.

 

12.                Termination

 

The Agreement shall be terminated after the full performance of all contractual obligations of the Domestic Company under transaction documents or after the dissolution of the contract. The pledgee shall dissolve the equity pledge hereunder in accordance with the written requirements of the pledgor, and the pledgor and the Domestic Company shall record the dissolution of the equity pledge in the register of shareholders of the Domestic Company and handle the dissolution formalities of equity pledge registration in the industry and commerce registration authority. The pledgor and the Domestic Company shall bear expenses arising from the dissolution of the equity pledge.

 

13.                Service charge and other fees

 

13.1                       The pledgor shall bear all fees and actual expenses in connection with the Agreement, including but not limited to legal fees, cost of production, stamp duty and any other taxes and fees. If the pledgee shall be liable for relevant taxes in accordance with laws, the pledgor shall compensate the pledgee with all taxes paid.

 

13.2                       If the pledgor fails to pay any taxes and fees payable in accordance with the Agreement, or the pledgee takes recourse in any way or manner due to other reasons, the pledgor shall bear all fees arising therefrom (including but not limited to various taxes, service charges, management fees, legal fees, attorney’s fees and insurance premiums for handling the pledge right).

 

14.                Governing laws and dispute resolution

 

14.1                       Governing laws. The conclusion, effectiveness, interpretation and performance of the Agreement as well as resolution of disputes arising from the Agreement shall be governed by laws of the PRC.

 

14.2                       Dispute resolution. Any dispute generated by interpretation and performance of the Agreement is solved by the parties firstly through friendly negotiation. If the dispute cannot be solved within thirty (30) days after one party receives the written notice on negotiated settlement from the other party, either party can submit the relevant dispute to Shanghai International Economic and Trade Arbitration Commission for arbitration in accordance with its arbitration rules in force. The place of arbitration shall be Shanghai; The language used in the arbitration is in Chinese. The arbitration award is final and has binding effect on the parties.

 

14.3                       During the arbitration, except the dispute matters or obligations submitted for arbitration, both parties shall continue the performance of other obligations under the Agreement. The arbitrator is entitled to make appropriate award based on the actual situation to grant appropriate legal relief to the Sole-funded Company, including restricting the business operation of the Domestic Company, restricting, prohibiting or ordering a transfer or disposal of the equity or assets of the Domestic Company, and conducting the liquidation of the Domestic Company.

 

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14.4                       At the request of the disputing party, a competent court  is entitled to grant provisional relief, such as award or order to detain or freeze the properties or equity of the default party. After the arbitration award takes effect, either party is entitled to apply for enforcement to a court with jurisdiction. In addition to courts in China Mainland, courts in China Hong Kong and the Cayman Islands also have the jurisdiction for the above purposes.

 

15.                Change in law

 

15.1                       After the effectiveness of the Agreement, in case of any modification to any national or local laws, rules, regulations or other normative documents by any national or local legislative or administrative agencies, including any amendment, supplement or abolishment, interpretation or enactment of implementation measures or rules (collectively, “amendment”), or enactment of new laws, rules, regulations or other normative documents (collectively, “new regulations”), the follows shall be applicable:

 

15.2                       If the amendment or new regulations is more favorable to any party (the other party is not seriously and adversely affected by it) than laws, rules, regulations or other normative documents in force on the effectiveness date of the Agreement, the parties shall apply to relevant agencies for the benefit from the amendment or new regulations (if required). The parties shall make best efforts to facilitate the approval of the application.

 

15.3                       If the amendment or new regulations has direct or indirect serious adverse effects on the economic interests of the pledgee hereunder, and the parties fail to solve the adverse effect on the economic interests of the pledgee in accordance with the Agreement, upon receiving the notice  from the pledgee, the parties shall make necessary modifications to the Agreement through negotiation to maintain the economic interests of the pledgee hereunder to the greatest extent.

 

16.                Force majeure

 

16.1                           “Force majeure event” refers to any event which is out of the reasonable control of one party and is unavoidable with the reasonable care of the affected party, including but not limited to natural disasters, government actions, forces of nature, fire, explosion, geographical changes, storms, floods, earthquakes, tides, lightning, wars or riots. However, any shortage of credit, fund or financing shall not be regarded as an event which is out of the reasonable control of one party. If the performance of the Agreement is delayed or obstructed due to any force majeure event, the affected party shall not be liable to the other party hereunder with respect to the delayed or obstructed part. If the affected party seeks to be exempted from its duties under the Agreement or any terms hereof, it shall promptly notify the other party the exemption and all steps necessary for completing the performance.

 

16.2                            The affected party shall be exempted from any liability hereunder arising therefrom. The party seeking an exemption can be exempted from the liability, provided that the affected party has taken all reasonable and practicable efforts to perform the Agreement. And the exemption is only limited to the performance delayed or obstructed. Once the reason for exemption from liability is corrected and remedied, both parties agree to take their best efforts to resume the performance hereunder.

 

17.                Others

 

17.1                     Notice. Unless the change of the following address is notified in writing, the notice hereunder shall be served to the following address by hand, fax or registered post. If sent by registered post, the service of the notice shall be deemed to be effected on the date recorded in the return receipt; if sent by hand or fax, the service of the notice shall be  effected on the date of proper sending. If the notice is sent by fax, the original shall be served to the following address by registered mail or by hand as soon as it is sent:  

 

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Sole-funded Company: Shanghai Lightinthebox Information Technology Co., Ltd.

 

Address: Floor 5, Building 2, Yaxin Science & Tech Park, No.399, Shengxia Road, Pudong New Area, Shanghai

 

Tel./Fax: 

 

Addressee: Fu Qianneng

 

Domestic Company: Dongguan Herui Supply Chain Management Co., Ltd

 

Address: Floor 5, Building 2, Yaxin Science & Tech Park, No.399, Shengxia Road, Pudong New Area, Shanghai

 

Tel./Fax: 

 

Addressee: Fu Qianneng

 

17.2                       Further warranty. The parties agree to promptly sign documents and take further actions reasonably necessary for implementing the provisions and purpose of the Agreement.

 

17.3                       Entire contract. Except the written amendments, supplements or modifications after the date of the Agreement, the Agreement shall constitute the entire contract between the parties regarding the subject matter hereof and shall supersede all previous negotiations, statements and contracts between the parties regarding the subject matter hereof, whether oral or written.

 

17.4                       Headings. The headings used herein are for convenience only and are not used to interpret, state or otherwise affect the meaning of the provisions hereof.

 

17.5                       Taxes and dues. All taxes and expenses incurred by each party with respect to the execution and performance of the Agreement shall be borne by each party respectively.

 

17.6                       Transfer of the Agreement. During the term of the Agreement, no party shall transfer part of or all of its rights and/or obligations hereunder to any third party without the prior written consent of the other party, except transfer by the pledgee to its affiliates.

 

17.7                       Severability of the Agreement. If any provision of the Agreement is judged as invalid, illegal or unenforceable under the laws of the PRC, remaining provisions hereof shall remain in full force. If any provision is judged as invalid, illegal or unenforceable, both parties shall amend the Agreement upon negotiation in good faith, to achieve the original intention of both parties to the greatest extent in an acceptable manner.

 

17.8                       Waiver. The waiver of any terms and conditions hereunder by either party can only be effective in written from upon the signature of the parties. The waiver by either party due to the breach of the other party under some circumstances shall not be deemed as its waiver of similar breaches of contract of the other party under other circumstances. Either party’s failure to exercise or delay in exercising any right hereunder shall not constitute its waiver thereof, and any exercise or partial exercise of any right shall not preclude the exercise of such right again in the future.

 

17.9                       Modification and supplement of the Agreement. The parties shall make modifications and supplements to the Agreement in written agreement. The modification agreements and supplementary agreements to the Agreement which are properly signed by the parties are part of the Agreement, with the same legal force.

 

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17.10                Succession and assignment of the Agreement. The Agreement is legally binding to the parties of the Agreement and legal successor and assignee of such party.

 

17.11                Agreement text. The Agreement shall be in Chinese and in multiple originals, with the same legal force. Both parties may sign copies of the Agreement separately.

 

17.12                Annex. The annex to the Agreement shall be an integral part of the Agreement.

 

[There is no text below on this Page]

 

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(There is no text on this Page)

 

For the above purpose, the parties have signed the Agreement on the date written at the start of this document.

 

Shanghai Lightinthebox Information Technology Co., Ltd. (Sealed)

 

	
/s/ Fu Qianneng
    	
 
    
	
Fu Qianneng
    	
 
    
	
Position: Legal   representative
    	
 
    

 

	
/s/ Fu Qianneng
    	
 
    
	
Fu Qianneng
    	
 
    

 

Dongguan Herui Supply Chain Management Co., Ltd. (Sealed)

 

	
/s/ Liu Li
    	
 
    
	
Liu Li
    	
 
    

Position: Legal representative

 

Signature page of the Equity Pledge Agreement

 

12

 

Annex I

 

Dongguan Herui Supply Chain Management Co., Ltd

Capital Contribution Certificate

 

Hereby certify

 

Fu Qianneng (ID No.:                        ) has contributed RMB 200,000, owning 40% equity of Dongguan Herui Supply Chain Management Co., Ltd.. The 40% equity has been fully pledged to Shanghai Lightinthebox Information Technology Co., Ltd.

 

	
Dongguan Herui Supply   Chain Management Co., Ltd. (Sealed)
    	
 
    
	
 
    	
 
    
	
/s/ Liu Li
    	
 
    
	
 
    	
 
    
	
Liu Li (legal representative)
    	
 
    
	
 
    	
 
    
	
September 27th, 2020
    	
 
    

 

13

 

Dongguan Herui Supply Chain Management Co., Ltd

 

	
Name/designation of the shareholder
    	
 
    	
ID No./registered address
    	
 
    	
Equity ratio
    	
 
    	
Registration of pledge
    
	
Fu Qianneng
    	
 
    	
(                   )
    	
 
    	
40%
    	
 
    	
40% equity has been pledged to Shanghai   Lightinthebox Information Technology Co., Ltd.
    

 

	
Dongguan Herui Supply   Chain Management Co., Ltd. (Sealed)
    	
 
    
	
 
    	
 
    
	
/s/ Liu Li
    	
 
    
	
 
    	
 
    
	
Liu Li (legal   representative)
    	
 
    
	
 
    	
 
    
	
September 27th, 2020
    	
 
    

 

14

 

Equity Pledge Agreement

 

The Equity Pledge Agreement (hereinafter referred to as “the Agreement”) is signed by the following both parties in Shanghai on September 27th, 2020:

 

1.                 Pledgee: Shanghai Lightinthebox Information Technology Co., Ltd.

 

Registered address: Room 378, No.588, West Huanhu No. 2 Road, China (Shanghai) Pilot Free Trade Zone Lin-gang Special Area.

 

2.                 Pledgor: Liu Li, ID No.: (                   )

 

3.                 Domestic Company: Dongguan Herui Supply Chain Management Co., Ltd

 

Registered address: No. 28, Middle Guanhuang Road, Gaobu Town, Dongguan City, Guangdong Province

 

Whereas:

 

(1)        The pledgor holds 60% equity of the Domestic Company, and there is no any pledge or any other encumbrance on its equity currently;

 

(2)        The pledgee is a wholly foreign-owned enterprise incorporated in the PRC. The pledgee and pledgor entered into the Exclusive Technical Consulting and Service Agreement (hereinafter referred to as the “Service Agreement”) on September 27th, 2020; the pledgee, the Domestic Company and the pledgor entered in to the Exclusive Option Agreement (“Exclusive Option Agreement”); the pledgor issues the Power of Attorney to the pledgee. The Exclusive Technical Consulting and Service Agreement, Exclusive Option Agreement and Power of Attorney above are collectively referred to as the “transaction documents”.

 

(3)        As the guarantee for the pledgor and the Domestic Company performing all contractual obligations (as defined below) hereunder, the pledgor shall provide the pledge guarantee to the pledgee with all equity of the Domestic Company held by it.

 

Upon consensus through negotiation, both parties reach the following agreement:

 

1.                       Definitions

 

Unless otherwise stipulated herein, the words used herein are defined as follows:

 

1.1                              Contractual obligations: refers to all obligations and responsibilities of the pledgor under the transaction documents and the statements, undertakings and warranties made under the transaction documents, as well as all obligations and responsibilities of the Domestic Company under the transaction documents and the statements, undertakings and warranties made under the transaction documents;

 

1.2                              Guaranteed debt: refers to the all direct and indirect and predictable loss of benefit suffered by the pledgee due to any default of the pledgor and/or the Domestic Company; and the costs incurred by the pledgee for forcing the pledgor and/or Domestic Company to perform their contractual obligations and realize the pledge.

 

1.3                               Pledge right: refers to the term set forth in Article 2.1 of the Agreement.

 

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1.4                               Pledged equity: refers to all equity of the Domestic Company legally held by the pledgor.

 

1.5                               Term of pledge: refers to the term set out in Article 4.1 of the Agreement.

 

1.6                               Event of default: refers to any circumstances set out in Article 8.1 of the Agreement.

 

1.7                               Notice of default: refers to the notice of default sent by the pledgee pursuant to the Agreement.

 

2.                       Pledge

 

Pursuant to the terms and conditions of the Agreement, the pledgee and the pledgor agree that the pledgor shall pledge its pledged equity to the pledgee as the guarantee for the full performance of the contractual obligations.

 

The pledgor and the Domestic Company shall make best effort to complete the registration formalities of the equity pledge hereunder in the industry and commerce administration authority, and to maintain the equity pledge registration effective continuously.

 

3.                       Pledge right

 

3.1             The pledgor shall pledge all equity of the Domestic Company held by it to the pledgee, as the guarantee for the pledgor and the Domestic Company performing all contractual obligations under the transaction documents.

 

3.2             The pledged equity guarantee covers all service fees, liquidated damages (if any), compensation and expenses for pledge right (including but not limited to attorney fees, arbitration fees, appraisal and auction fees of the pledged equity) payable to the pledgee.

 

3.3             The pledge right refers to right of the pledgee to be paid in priority with the income from the discount, auction or sale of the equity pledged to it by the pledgor.

 

4.                       Term of pledge

 

4.1             The Agreement shall come into effect upon registration of the equity pledge in the register of shareholders of the Domestic Company. The validity period of the pledge is the same as the maximum validity period of all contracts under the transaction documents.

 

4.2             The pledge right hereunder is effective from the pledge registration of the pledged equity in the industry and commerce administration department to the full repayment of the secured debts. Within 30 days since the date of the Agreement, pursuant to relevant laws and regulations of the PRC, the pledgor shall apply to the industry and commerce administration authority at the place where the Domestic Company is located for the registration of the pledge matters.

 

4.3             During the term of pledge, if the Domestic Company or the pledgor fails to fully perform all contractual obligations or in the event of any default set forth in Article 8.1, the pledgee is entitled to dispose of the pledge right in accordance with the provisions of the Agreement and relevant laws and regulations of the PRC.

 

5.                       The custody of the pledge certificate and the earnings from the pledged equity

 

5.1                   During the term of pledge stipulated herein, the Pledgor shall or cause the Domestic Company to execute the investment certificate (as the Annex I hereto) and the register of shareholders, deliver the above duly executed documents and the certificate of pledge registration issued by the industry and commerce administration authority to the pledgee for keeping during the term of pledge stipulated herein.

 

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5.2                   During the validity period of the Agreement, the pledgee is entitled to collect all earnings (if any) from the pledged equity, including but not limited to bonus, dividends and other cash and all non-cash earnings from the pledged equity.

 

6.                       Representations and warranties of the pledgor

 

6.1                                The pledgee is entitled to exercise, dispose of or transfer the pledge right in the manner specified herein.

 

6.2                                The pledgor individually and jointly represents, warrants and undertakes to the pledgee that:

 

6.2.1                     It has the full authority to conclude the Agreement and perform the obligations under the Agreement; it has granted its authorized representative the power to sign the Agreement. The terms of the Agreement shall be legally binding upon it since the effective date of the Agreement.

 

6.2.2                     As the legal owner of the pledged equity, the pledgor is entitled to pledge the pledged equity to the pledgee; the exercise of the pledge right by the pledgee will not be obstructed legally or actually.

 

6.2.3                     The Domestic Company is a limited liability company duly incorporated and validly existing under the laws of the PRC, duly registered in the industry and commerce administration department, and has passed all annual inspections. The registered capital of the Domestic Company is RMB 500,000.

 

6.2.4                     Its execution, delivery and performance of the Agreement will not:

 

(a)           Conflict with, or violate the following documents or upon receipt of the relevant notice or with time: (i) its business license, Articles of Association, permits, government approvals for its establishment, contracts relating to its establishment or any other framework documents, (ii) other laws which are binding on it, (iii) any contract to which the pledger and the Domestic Company are parties or which is binding on them or their assets, or other documents;

 

(b)            Create any pledge or other encumbrances to its assets or enable any third party to set any pledge or other encumbrances to its assets;

 

(c)             Terminate or modify any terms of any contract to which the Domestic Company is a party or which is binding on it or its assets or other documents, or enable any third party to terminate or modify terms of such documents;

 

(d)            Result in the suspension, revocation, damage, confiscation or non-renewal upon expiry of any approval, permit and registration from any government department applicable to it.

 

6.2.5                     Except the pledge of the pledgor hereunder, there is no mortgage, pledge or other forms of guarantee, priority, legal mortgage right, property preservation measures, seizure, custody, lease right, option or other forms of encumbrance (collectively, “encumbrance”) to the pledged equity hereunder on the effective date of the Agreement.

 

6.2.6                     Each pledgor may accept the equity of the Domestic Company held by other pledgors or subscribe the increased registered capital of the Domestic Company with the prior written consent of the pledgee. The equity accepted or the increased registered capital subscribed by the pledgor shall be covered in the pledged equity. After the pledgor accepts the equity or completes the capital increase of the Domestic Company, the pledgor and the Domestic Company shall be responsible for registering the changed equity pledge in the register of shareholders of the Domestic Company, and handle the equity pledge registration formalities in relevant industry and commerce registration authorities.

 

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6.2.7                     Timely notify the pledgee events which may affect the its right to the equity or its any part, or the notice received in connection with this; and events which may affect any warranty and obligation set by the pledgor for change of the Agreement, or the notice received in connection with this.

 

6.2.8                     For relevant certificates, licenses, authorizations and other legal documents necessary for the pledgee disposing of the pledged equity in accordance with the Agreement, it shall unconditionally provide or ensure the availability of above documents and give all kinds of convenience; the pledgor guarantees that, once the pledged equity is transferred to the pledgee or its designated beneficiary, the pledgor and/or Domestic Company will unconditionally fulfill all formalities required by laws, to enable the pledgee or its designated beneficiary to obtain the equity of the Domestic Company legally and effectively, including but not limited to the issuance of relevant documentary evidence, the signing of the equity transfer agreement and other relevant documents.

 

6.2.9                     It undertakes to the pledgee that the pledgor will follow and perform all warranties, undertakings, contracts, statements and conditions for the benefit of the pledgee. If the pledgor fails to perform or fully perform its warranties, undertakings, contracts, statements and conditions, the pledgor shall compensate the pledgee for all losses arising therefrom.

 

6.2.10              The pledger warrants to the pledgee that, it has made all proper arrangement and signed all necessary documents to ensure that, in case of death, incapacity, bankruptcy and divorce or other circumstances that may affect the exercise of equity, its successor, guardian, creditor, spouse or persons who may obtain the equity or related rights will not affect or obstruct the performance of the Agreement.

 

7.                       Undertakings of the pledgor

 

7.1                               During the term of the Agreement, the pledgor undertakes to the pledgee that it shall:

 

7.1.1                     Except the transfer of the equity to the pledgee or its designated personnel in accordance with the Exclusive Option Agreement, without the prior written consent of the pledgee:

 

A.               Not transfer the equity, or establish or allow the existence of any pledge or other forms of guarantee which may affect the rights and interests of the pledgee;

 

B.                Not take any acts which have reduced or may reduce the value of the pledged equity, or endanger the validity of the pledge hereunder. In case of obvious decrease in the value of the pledged equity which is sufficient to endanger the right of the pledgee, the pledgor shall immediately notify the pledgee and provide other properties satisfactory to the pledgee as guarantee upon the reasonable request of the pledgee, and take necessary actions to solve the above events or reduce the adverse effects. The pledgor further warrants that, during the validity period of the Agreement, the operation of the Domestic Company shall comply with laws of the PRC in all material aspects and maintain the continuous validity of all business licenses and qualifications of the Domestic Company.

 

7.1.2                     Comply with and implement provisions of relevant laws and regulations with respect to the pledge of rights, submit the notices, instructions or suggestions from or made by relevant competent authorities with respect to the pledge right to the pledgee within five days upon receipt, comply with above notices, instructions or suggestions, or make objections and statements in respect of the above matters at the reasonable request of the pledgee or with the consent of the pledgee;

 

7.1.3                     Timely notify the pledgee events which may affect the pledged equity or its any part of rights, or the notice received in connection with this; and any events that may change any warranty, obligations of the pledgor under the Agreement or may affect the performance of the pledgor’s obligations under the Agreement, or the notice received in connection with this.

 

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7.2                            The pledgor agrees that, the right for the pledgee exercising its pledge right it obtained under the Agreement shall not be interrupted or obstructed by the pledgor or its successor or principal or any other persons through legal procedures.

 

7.3                            The pledgor warrants to the pledgee that, to protect or perfect the security interest of the pledgee hereunder, the pledgor will sign in good faith and cause other parties which have interests in the pledge right to sign all certificates of rights and covenants required by the pledgee, and/or perform and cause other parties which have interests to perform actions required by the pledgee, provide convenience for the exercise of rights and authorizations granted to the pledgee hereunder, sign all change documents in connection with equity certificates with the pledgee or its designated person (natural person/legal person), and provide the pledgee with all notices, orders and decisions related to the pledge right as the pledgee thinks necessary within a reasonable period.

 

7.4                            The pledgor warrants to the pledgee that the pledgor will follow and perform all warranties, undertakings, contracts, statements and conditions for the benefit of the pledgee. If the pledgor fails to perform all or part of its warranties, undertakings, contracts, statements and conditions, the pledgor shall compensate the pledgee for all losses arising therefrom.

 

7.5                            The pledgor warrants to the pledgee that, the pledgor and other shareholders shall be jointly and severally liable for the obligations hereunder.

 

7.6                            Due to the equity transfer caused by the exercise of pledge by the pledgee, the pledgor irrevocably agrees to waive the preemptive right to the pledge the pledged equity to the pledgee by other shareholders of the Domestic Company.

 

8.                        Event of default

 

8.1                              The following events shall be deemed as events of default:

 

8.1.1                     The pledgor or the Domestic Company fails to perform all of its contractual obligations pursuant to the transaction documents;

 

8.1.2                     There is material misrepresentation or error in any representations or warranties made by the pledgor set forth in Article 6 hereof, and/or the pledgor violates the representations and warranties set forth in Article 6 hereof;

 

8.1.3                     The pledgor violates the undertakings set forth in Article 7 hereof;

 

8.1.4                     The pledgor violates any terms of the Agreement;

 

8.1.5                     Except as stipulated in Article 7.1.1 hereof, the pledgor waives the pledged equity or transfers or otherwise disposes of the pledged equity without the written consent of the pledgee;

 

8.1.6                     Any external loan, guarantee, indemnity, undertaking or other repayment liabilities of the pledgor (1) is required to be repaid or performed in advance due to default; or (2) has become due but cannot be repaid or performed on time, resulting in that the pledgee believes that the pledgor’s capacity to perform its obligations hereunder has been affected;

 

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8.1.7                     The pledgor is incapable to pay general debts or other debts;

 

8.1.8                     The Agreement is illegal or the pledgor cannot continuously perform its obligations hereunder duet to the enactment of relevant laws and regulations;

 

8.1.9                     Any governmental consents, licenses, approvals or authorizations necessary for the performance, legality or validity of the Agreement is revoked, suspended, invalid or materially modified;

 

8.1.10              The pledgee believes that the pledgor’s capacity for performing its obligations hereunder is affected due to adverse changes to the assets owned by the pledgor;

 

8.1.11              The successor or the custodian of the Domestic Company can only perform partial or refuses to perform the payment liability under the service agreement;

 

8.1.12              Other circumstances under which the pledgee is incapable to dispose of the pledge right in accordance with relevant laws.

 

8.2                            The pledgor shall immediately notify the pledgee in writing if it is aware of or finds the occurrence of any matters set forth in Clause 8.1 or the events that may result in above matters.

 

8.3                            Unless the events of default set forth in Clause 8.1 are perfectly solved under the conditions to the satisfactory of the pledgee, the pledgee can send a default notice to the pledgor at or after the occurrence of the events of default, requiring the pledgor to immediately pay all debts and other amounts payable under the service agreement or exercise the pledge right pursuant to Article 9 hereof.

 

9.                        Exercise of pledge right

 

9.1                            In case of the pledgor’s breach or non-performance of any contractual obligations, the pledgee is entitled to dispose of all or part of pledged equity held by any shareholder (regardless whether the shareholder is in violation of the contractual obligations) of the Domestic Company, and to pay the expense set forth in Clause 3.2 with the price from the disposal of the pledged equity in priority.

 

9.2                            Prior to the full performance of contractual obligations, the pledgor shall not waive, transfer or otherwise dispose of the pledged equity without the written consent of the pledgee.

 

9.3                            When exercising the pledge right, the pledgee shall give a written default notice to the pledgor.

 

9.4                            Subject to Article 10, the pledgee may dispose of the pledge right while giving the default notice in accordance with Article 10 or at any time after giving the default notice.

 

9.5                            Subject to Clause 8.3, the pledgee may excise its rights while giving the default notice in accordance with Article 8.3 or at any time after giving the default notice.

 

9.6                            In the event of the pledgor’s any breach or non-performance of any contractual obligation, the pledgee is entitled to discount all or part of the pledged equity hereunder in accordance with legal procedures, or be paid in priority with the income from the auction and sales of the equity until all secured debts are paid off.

 

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9.7                            While the pledgee exercising the pledge right pursuant to the Agreement, the pledgor shall not set an obstacle and shall provide necessary assistance, to help the pledgee achieve the pledge right.

 

9.8                            Amounts from exercising the pledge right by the pledgee shall be disposed of based on the following orders: firstly, pay all expenses (including the remuneration for the attorneys and agents) incurred in connection with the disposal of the pledged equity and the exercise of the rights and powers by the pledgee; secondly, pay taxes payable due to the disposal of the pledged equity; thirdly, repay the secured debts to the pledgee. For the balance after deducting above amounts, the pledgee shall return it to the pledgor or deposit it to those to whom the amount is entitled in accordance with relevant laws and regulations or the notary office in the place where the pledgee is located (the pledgor shall bear all expenses arising therefrom). If the amount from the discount, auction or sale of the pledged equity is insufficient to repay the secured debt, the pledgor shall pay off the insufficient part.

 

10.                 Liability for breach of contract and compensation

 

10.1                     Liability for breach of contract. Unless otherwise provided in the Agreement, both parties agree and confirm that if either party (“default party”) fails to perform any of its obligations hereunder or otherwise violates the Agreement, i.e., constituting a breach of the Agreement (“breach”), then the other party (“observant party”) is entitled to:

 

(a)                              Send written notice to the default party, describing default nature and range and requiring default party to make remedy at its own expense within proper period specified in the notice (“remedy period”); and

 

(b)                              If the default party fails to remedy the breach within the remedy period, the aggrieved party is entitled to require the default party to bear all liabilities arising from the breach, and to compensate the aggrieved party for all actual economic losses incurred, including but not limited to the attorney fees, legal fees or arbitration fees incurred for the lawsuit or arbitration proceedings relating to such breach. In addition, the aggrieved party is entitled to require the default party to actually perform the Agreement. The aggrieved party is also entitled to request an order from relevant arbitration agency or court for the actual performance and/or enforcement of terms agreed herein. The exercise of the above relief rights by the aggrieved party shall not prejudice its exercise of other relief rights in accordance with the Agreement and laws.

 

10.2                     Compensation. The pledgor shall fully compensate the pledgee with any loss, damage, obligation and/or expenses incurred by any lawsuit, claim or other requests against the pledgee arising from or caused by the performance of the Agreement, and protect the pledgee from any damage and loss of the pledgee arising from the pledgor’s behavior or any third party’s request in connection with the behavior of the pledgor.

 

11.      Transfer

 

11.1                     The pledgor is not entitled to grant or transfer its rights and obligations hereunder without the prior consent of the pledgee.

 

11.2                     The Agreement is binding on the pledgor and its successors, and is valid to the pledgee and any of its successor and assignee.

 

11.3                     The pledgee may transfer any or all of its rights and obligations hereunder to its designated person (natural person/legal person) at any time. In such case, the assignee shall enjoy and undertake the rights and obligations enjoyed and undertaken the pledgee hereunder as if it is a party to the Agreement. When pledgee transfers its rights and obligations hereunder, at the

request of the pledgee, the pledgor shall sign relevant agreements and/or documents for this transfer.

 

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11.4                     During the term of the Agreement, the pledgor shall not transfer part of or all its rights or obligations hereunder to any third party without the prior written consent of the pledgee. However, the pledgee is entitled to transfer part of or all its rights and obligations hereunder.

 

11.5                    In case of the change of the pledgee due to the transfer, the new pledgor and pledgee shall enter into a new pledge agreement.

 

12.                 Termination

 

The Agreement shall be terminated after the full performance of all contractual obligations of the Domestic Company under transaction documents or after the dissolution of the contract. The pledgee shall dissolve the equity pledge hereunder in accordance with the written requirements of the pledgor, and the pledgor and the Domestic Company shall record the dissolution of the equity pledge in the register of shareholders of the Domestic Company and handle the dissolution formalities of equity pledge registration in the industry and commerce registration authority. The pledgor and the Domestic Company shall bear expenses arising from the dissolution of the equity pledge.

 

13.                 Service charge and other fees

 

13.1                 The pledgor shall bear all fees and actual expenses in connection with the Agreement, including but not limited to legal fees, cost of production, stamp duty and any other taxes and fees. If the pledgee shall be liable for relevant taxes in accordance with laws, the pledgor shall compensate the pledgee with all taxes paid.

 

13.2                 If the pledgor fails to pay any taxes and fees payable in accordance with the Agreement, or the pledgee takes recourse in any way or manner due to other reasons, the pledgor shall bear all fees arising therefrom (including but not limited to various taxes, service charges, management fees, legal fees, attorney’s fees and insurance premiums for handling the pledge right).

 

14.                 Governing laws and dispute resolution

 

14.1                    Governing laws. The conclusion, effectiveness, interpretation and performance of the Agreement as well as resolution of disputes arising from the Agreement shall be governed by laws of the PRC.

 

14.2                    Dispute resolution. Any dispute generated by interpretation and performance of the Agreement is solved by the parties firstly through friendly negotiation. If the dispute cannot be solved within thirty (30) days after one party receives the written notice on negotiated settlement from the other party, either party can submit the relevant dispute to Shanghai International Economic and Trade Arbitration Commission for arbitration in accordance with its arbitration rules in force. The place of arbitration shall be Shanghai; The language used in the arbitration is in Chinese. The arbitration award is final and has binding effect on the parties.

 

14.3                    During the arbitration, except the dispute matters or obligations submitted for arbitration, both parties shall continue the performance of other obligations under the Agreement. The arbitrator is entitled to make appropriate award based on the actual situation to grant appropriate legal relief to the Sole-funded Company, including restricting the business operation of the Domestic Company, restricting, prohibiting or ordering a transfer or disposal of the equity or assets of the Domestic Company, and conducting the liquidation of the Domestic Company.

 

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14.4                    At the request of the disputing party, a competent court  is entitled to grant provisional relief, such as award or order to detain or freeze the properties or equity of the default party. After the arbitration award takes effect, either party is entitled to apply for enforcement to a court with jurisdiction. In addition to courts in China Mainland, courts in China Hong Kong and the Cayman Islands also have the jurisdiction for the above purposes.

 

15.                 Change in law

 

15.1                    After the effectiveness of the Agreement, in case of any modification to any national or local laws, rules, regulations or other normative documents by any national or local legislative or administrative agencies, including any amendment, supplement or abolishment, interpretation or enactment of implementation measures or rules (collectively, “amendment”), or enactment of new laws, rules, regulations or other normative documents (collectively, “new regulations”), the follows shall be applicable:

 

15.2                    If the amendment or new regulations is more favorable to any party (the other party is not seriously and adversely affected by it) than laws, rules, regulations or other normative documents in force on the effectiveness date of the Agreement, the parties shall apply to relevant agencies for the benefit from the amendment or new regulations (if required). The parties shall make best efforts to facilitate the approval of the application.

 

15.3                    If the amendment or new regulations has direct or indirect serious adverse effects on the economic interests of the pledgee hereunder, and the parties fail to solve the adverse effect on the economic interests of the pledgee in accordance with the Agreement, upon receiving the notice  from the pledgee, the parties shall make necessary modifications to the Agreement through negotiation to maintain the economic interests of the pledgee hereunder to the greatest extent.

 

16.                 Force majeure

 

16.1                    “Force majeure event” refers to any event which is out of the reasonable control of one party and is unavoidable with the reasonable care of the affected party, including but not limited to natural disasters, government actions, forces of nature, fire, explosion, geographical changes, storms, floods, earthquakes, tides, lightning, wars or riots. However, any shortage of credit, fund or financing shall not be regarded as an event which is out of the reasonable control of one party. If the performance of the Agreement is delayed or obstructed due to any force majeure event, the affected party shall not be liable to the other party hereunder with respect to the delayed or obstructed part. If the affected party seeks to be exempted from its duties under the Agreement or any terms hereof, it shall promptly notify the other party the exemption and all steps necessary for completing the performance.

 

16.2                     The affected party shall be exempted from any liability hereunder arising therefrom. The party seeking an exemption can be exempted from the liability, provided that the affected party has taken all reasonable and practicable efforts to perform the Agreement. And the exemption is only limited to the performance delayed or obstructed. Once the reason for exemption from liability is corrected and remedied, both parties agree to take their best efforts to resume the performance hereunder.

 

17.                 Others

 

17.1                     Notice. Unless the change of the following address is notified in writing, the notice hereunder shall be served to the following address by hand, fax or registered post. If sent by registered post, the service of the notice shall be deemed to be effected on the date recorded in the return receipt; if sent by hand or fax, the service of the notice shall be  effected on the date of proper sending. If the notice is sent by fax, the original shall be served to the following address by registered mail or by hand as soon as it is sent:

 

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Sole-funded Company: Shanghai Lightinthebox Information Technology Co., Ltd.

 

Address: Floor 5, Building 2, Yaxin Science & Tech Park, No.399, Shengxia Road, Pudong New Area, Shanghai

 

Tel./Fax: 

 

Addressee: Fu Qianneng

 

Domestic Company: Dongguan Herui Supply Chain Management Co., Ltd

 

Address: Floor 5, Building 2, Yaxin Science & Tech Park, No.399, Shengxia Road, Pudong New Area, Shanghai

 

Tel./Fax: 

 

Addressee: Fu Qianneng

 

17.2                     Further warranty. The parties agree to promptly sign documents and take further actions reasonably necessary for implementing the provisions and purpose of the Agreement.

 

17.3                     Entire contract. Except the written amendments, supplements or modifications after the date of the Agreement, the Agreement shall constitute the entire contract between the parties regarding the subject matter hereof and shall supersede all previous negotiations, statements and contracts between the parties regarding the subject matter hereof, whether oral or written.

 

17.4                     Headings. The headings used herein are for convenience only and are not used to interpret, state or otherwise affect the meaning of the provisions hereof.

 

17.5                     Taxes and dues. All taxes and expenses incurred by each party with respect to the execution and performance of the Agreement shall be borne by each party respectively.

 

17.6                     Transfer of the Agreement. During the term of the Agreement, no party shall transfer part of or all of its rights and/or obligations hereunder to any third party without the prior written consent of the other party, except transfer by the pledgee to its affiliates.

 

17.7                     Severability of the Agreement. If any provision of the Agreement is judged as invalid, illegal or unenforceable under the laws of the PRC, remaining provisions hereof shall remain in full force. If any provision is judged as invalid, illegal or unenforceable, both parties shall amend the Agreement upon negotiation in good faith, to achieve the original intention of both parties to the greatest extent in an acceptable manner.

 

17.8                     Waiver. The waiver of any terms and conditions hereunder by either party can only be effective in written from upon the signature of the parties. The waiver by either party due to the breach of the other party under some circumstances shall not be deemed as its waiver of similar breaches of contract of the other party under other circumstances. Either party’s failure to exercise or delay in exercising any right hereunder shall not constitute its waiver thereof, and any exercise or partial exercise of any right shall not preclude the exercise of such right again in the future.

 

17.9                     Modification and supplement of the Agreement. The parties shall make modifications and supplements to the Agreement in written agreement. The modification agreements and supplementary agreements to the Agreement which are properly signed by the parties are part of the Agreement, with the same legal force.

 

24

 

17.10              Succession and assignment of the Agreement. The Agreement is legally binding to the parties of the Agreement and legal successor and assignee of such party.

 

17.11              Agreement text. The Agreement shall be in Chinese and in multiple originals, with the same legal force. Both parties may sign copies of the Agreement separately.

 

17.12              Annex. The annex to the Agreement shall be an integral part of the Agreement.

 

[There is no text below on this Page]

 

25

 

(There is no text on this Page)

 

For the above purpose, the parties have signed the Agreement on the date written at the start of this document.

 

Shanghai Lightinthebox Information Technology Co., Ltd. (Sealed)

 

	
/s/ Fu Qianneng
    	
 
    
	
Fu Qianneng
    	
 
    

Position: Legal representative

 

	
/s/ Liu Li
    	
 
    
	
Liu Li
    	
 
    

 

Dongguan Herui Supply Chain Management Co., Ltd. (Sealed)

 

	
/s/ Liu Li
    	
 
    
	
Liu Li
    	
 
    

Position: Legal representative

 

Signature page of the Equity Pledge Agreement

 

26

 

Annex I

 

Dongguan Herui Supply Chain Management Co., Ltd

Capital Contribution Certificate

 

Hereby certify

 

Liu Li (ID No.:                               ) has contributed RMB 300,000, owning 60% equity of Dongguan Herui Supply Chain Management Co., Ltd.. The 60% equity has been fully pledged to Shanghai Lightinthebox Information Technology Co., Ltd.

 

	
Dongguan Herui Supply   Chain Management Co., Ltd. (Sealed)
    	
 
    
	
 
    	
 
    
	
/s/ Liu Li
    	
 
    
	
 
    	
 
    
	
Liu Li (legal   representative)
    	
 
    
	
 
    	
 
    
	
September 27th, 2020
    	
 
    

 

 

Dongguan Herui Supply Chain Management Co., Ltd

 

	
Name/designation
   of the shareholder
    	
 
    	
ID No./registered address
    	
 
    	
Equity ratio
    	
 
    	
Registration of pledge
    
	
Liu Li
    	
 
    	
(                              )
    	
 
    	
60
    	
%
    	
60% equity has been pledged to Shanghai   Lightinthebox Information Technology Co., Ltd.
    

 

	
Dongguan Herui Supply   Chain Management Co., Ltd. (Sealed)
    	
 
    
	
 
    	
 
    
	
/s/ Liu Li
    	
 
    
	
 
    	
 
    
	
Liu Li (legal   representative)
    	
 
    
	
 
    	
 
    
	
September 27th, 2020

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