Document:

Exhibit 4.22

 

English Translation

 

Equity Pledge Agreement

 

Regarding Shanghai E-Cheng Asset Management Co., Ltd.

 

By and among

 

Qimin WU

 

Tianxiang HU

 

Baoyi Investment Consulting (Shanghai) Co., Ltd.

 

And

 

Shanghai E-Cheng Asset Management Co., Ltd.

 

March 13, 2017

 

 

EQUITY PLEDGE AGREEMENT

 

This EQUITY PLEDGE AGREEMENT (this “Agreement”) is entered into in Shanghai, the PRC, on March 13, 2017 by and among:

 

1.                                      Qimin WU
  Identity Card No.: ***

 

2.                                      Tianxiang HU
 Identity Card No.: ***

 

(Qimin WU and Tianxiang HU are hereinafter referred to individually as a “Pledgor” and collectively as the “Pledgors”.)

 

3.                                      Baoyi Investment Consulting (Shanghai) Co., Ltd. (the “Pledgee”)
 Registered address: Room 104, Block 94, 149 Yan Chang Road, Shanghai

 

4.                                      Shanghai E-Cheng Asset Management Co., Ltd. (the “Company”)
 Registered address: Room 221 Block 1, 195 Yong He Zhi Road, Zhabei district, Shanghai

 

(In this Agreement, the above parties are referred to individually as a “Party” and collectively as the “Parties”.)

 

WHEREAS

 

(1)                                 The Pledgors are the registered shareholders of the Company, legally holding all the equity interest in the Company (the “Company Equity Interest”). Appendix 1 sets forth the capital contribution amount and the shareholding percentage of each Pledgor in the registered capital of the Company on the signing date of this agreement.

 

(2)                                 The Parties to this Agreement entered into the Exclusive Call Option Agreement (the “Call Option Agreement”) on March 13, 2017. Under the Call Option Agreement, the Pledgors shall, to the extent permitted by the PRC Law, transfer all or part of the equity interest they hold in the Company to the Pledgee and/or any other entity or individual designated by the Pledgee based on the Pledgee’s request.

 

(3)                                 The Parties to this Agreement entered into the Shareholder Voting Rights Proxy Agreement (the “Proxy Agreement”) on March 13, 2017. Under the Proxy Agreement, the Pledgors irrevocably delegated the individual then designated by the Pledgee with the full power to exercise on behalf of the Pledgors all their shareholder voting rights in the Company.

 

 

(4)                                 The Pledgors and Pledgee entered into a Loan Agreement on March 13, 2017 (the “Loan Agreement”). The Pledgee has provided the Pledgors with a loan in the amount of RMB1,000,000 (in words: one million Yuan).

 

(5)                                 The Company and Pledgee entered into an Exclusive Technical Assistance Agreement (the “Service Agreement”) on May 14, 2014. According to the agreement, the Company exclusively hired Pledgee to provide assistance in connection with relevant technology transfer, technology licensing, technical services and equipment provision, and agreed to pay Pledgee the corresponding fees for such technical assistance.

 

(6)                                 As the Pledgors’ security for the performance of the Contractual Obligations (as defined below) and the discharge of the Secured Liabilities (as defined below), the Pledgors are willing to pledge all the Company Equity Interest they hold in favor of the Pledgee and grant the Pledgee the first pledge, and the Company agrees to such equity interest pledge arrangement.

 

THEREFORE, the Parties, after consultations, hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

1.1                               Unless otherwise indicated in the context in this Agreement, the following terms shall be interpreted as follows.

 

“Contractual Obligations” means all the contractual obligations of the Pledgors under the Call Option Agreement, the Proxy Agreement and the Loan Agreement, all the contractual obligations of the Company under the Call Option Agreement and the Proxy Agreement, and all the contractual obligations of the Pledgors and the Company under this Agreement.

 

“Secured Liabilities” means all the direct, indirect and derivative losses and loss of foreseeable interest incurred by the Pledgee due to any Event of Default (as defined below) on the part of the Pledgors and/or the Company; the basis for determining the amount of such losses includes but not limited to the reasonable commercial plan and profit forecast of the Pledgee; and all the expenses incurred by the Pledgee to enforce the performance by the Pledgors and/or the Company of their Contractual Obligations.

 

“Transaction Documents” means the Call Option Agreement, the Proxy Agreement and the Loan Agreement.

 

“Event of Default” means any breach by any Pledgor of any of its Contractual Obligations under the Call Option Agreement, the Proxy Agreement, the Loan Agreement and/or this Agreement, and any breach by the Company of any of its contractual obligations under the Call Option Agreement, the Proxy Agreement, the Service Agreement and/or this Agreement.

 

 

“Pledged Equity Interest” means all the Company Equity Interest lawfully owned by the Pledgors as of the date hereof and to be pledged to the Pledgee in accordance with this Agreement as the security for the performance of the Contractual Obligations by the Pledgors and the Company (see Appendix 1 for the specific Pledged Equity Interest of each Pledgor), together with the increased capital contribution amount and the dividend as provided in Article 2.6 and Article 2.7 of this Agreement.

 

“PRC” means the People’s Republic of China, for the purpose of this Agreement, excluding Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan.

 

“PRC Law” means the then-effective laws, administrative regulations, administrative rules, local regulations, judicial interpretations, and other binding regulatory documents of the PRC.

 

1.2                               Any reference to any PRC Law in this Agreement shall be deemed (1) to include references to the amendments, changes, supplements and restatement of such PRC Law, irrespective of whether they take effect before or after the execution of this Agreement, and (2) to include the references to other decisions, notices and regulations enacted in accordance therewith or effective as a result thereof.

 

1.3                               Unless otherwise specified in the context herein, any reference to an Article, clause, item or paragraph in this Agreement shall refer to the corresponding part of this Agreement.

 

ARTICLE II

 

PLEDGE OF EQUITY INTEREST

 

2.1                               The Pledgors hereby agree to pledge the Pledged Equity Interest, which they lawfully own and are entitled to dispose of, to the Pledgee in accordance with the provisions of this Agreement as the security for the performance of the Contractual Obligations and the discharge of the Secured Liabilities. The Company hereby agrees to the Pledgors’ pledge of the Pledged Equity Interest to the Pledgee in accordance with the provisions of this Agreement.

 

2.2                               The Pledgors undertake to be responsible for registering the equity interest pledge arrangement (the “Equity Pledge”) under this Agreement on the Company’s register of shareholders on the signing date of this agreement.

 

The Parties shall use their best efforts to apply to the registration authority in charge of the Company for registration of the Equity Pledge under this Agreement immediately after the signing of this Agreement.

 

 

2.3                               During the valid term of this Agreement, unless attributable to the Pledgee’s willful conduct or the Pledgee’s gross negligence with direct causation to the consequence, the Pledgee shall in no way be held liable to any reduction of the value of the Pledged Equity Interest, and the Pledgors have no right to claim any compensation or other request in any way against the Pledgee.

 

2.4                               Without breaching the provisions of Article 2.3 above, if there is any probability that the value of the Pledged Equity Interest will notably reduce which is sufficient to jeopardize the rights of the Pledgee, the Pledgee may at any time auction or sell the Pledged Equity Interest on behalf of the Pledgors, and may reach agreement with the Pledgors to use the proceeds from such auction or sales to prepay the Secured Liabilities or to deposit such proceeds with the notary office in the place where the Pledgee is domiciled (all expenses so incurred shall be assumed by the Pledgee). Further, if requested by the Pledgee, the Pledgors shall offer additional property as security.

 

2.5                               Upon the occurrence of any Event of Default, the Pledgee has the right to dispose of the Pledged Equity Interest in accordance with Article 4 of this Agreement.

 

2.6                               The Pledgors shall not increase the registered capital of the Company without the Pledgee’s prior consent. The increased capital contribution amount of the Pledgors in the registered capital of the Company as a result of such capital increase of the Company shall be a part of the Pledged Equity Interest.

 

2.7                               No dividend or capital bonus on the Pledged Equity Interest shall be distributed to the Pledgors without the Pledgee’s prior consent. The Pledgors agree that during the term of pledge, the Pledgee has the right to collect any dividend or capital bonus out of the Pledged Equity Interest. The Company shall pay such amount to the bank account designated by the Pledgee.

 

2.8                               The Pledgee has the right to dispose of any of the Pledged Equity Interest of any Pledgor in accordance with this Agreement after the occurrence of any Event of Default.

 

ARTICLE III

 

RELEASE OF PLEDGE

 

3.1                               After the Pledgors and the Company fully and completely perform all of the Contractual Obligations and discharge all of the Secured Liabilities, the Pledgee shall, upon the Pledgors’ request, release the Equity Pledge under this Agreement and cooperate with the Pledgors to deregister the Equity Pledge on the Company’s register of shareholders and with the administration of industry and commerce in charge of the Company. The Pledgee shall assume the reasonable expenses arising out of the release of the Equity Pledge.

 

 

ARTICLE IV

 

DISPOSAL OF PLEDGED EQUITY INTEREST

 

4.1                               The Parties agree that if any Event of Default occurs, the Pledgee has the right to, by notifying the Pledgors in writing, exercise all the remedial rights and powers that it is entitled to under the PRC Law, the Transaction Documents and the provisions of this Agreement, including but not limited to being compensated in first priority with proceeds from auctions or sales of the Pledged Equity Interest. The Pledgee shall not be liable to any loss caused by its reasonable exercise of such rights and powers.

 

4.2                               The Pledgee has the right to delegate in writing its lawyers or other agents to exercise all or any part of its rights and powers above, and neither the Pledgors nor the Company may oppose thereto.

 

4.3                               The Pledgee has the right to deduct the reasonable expenses actually incurred from its exercise of all or any part of its rights and powers above from the proceeds gained from its exercise of such rights and powers.

 

4.4                               The proceeds gained from the Pledgee’s exercise of its rights and powers shall be settled in accordance with the following order:

 

(1)                                 firstly, pay all expenses arising out of the disposal of the Pledged Equity Interest and the Pledgee’s exercise of its rights and powers (including the remuneration paid to its lawyers and agents);

 

(2)                                 secondly, pay the taxes and charges payable for the disposal of the Pledged Equity Interest; and

 

(3)                                 thirdly, repay the Secured Liabilities to the Pledgee.

 

If there is any balance after the payment of the above amounts, the Pledgee shall return the balance to the Pledgors or any other person entitled to such amount pursuant to relevant laws and regulations, or deposit such amount with the notary office in the place where the Pledgee is domiciled (all expenses so incurred to be assumed by the Pledgee).

 

4.5                               The Pledgee has the discretion to, simultaneously or in certain sequence, exercise any remedies for defaults it is entitled to. The Pledgee may exercise its rights to auction or sell the Pledged Equity Interest under this Agreement without first exercising any other remedies for defaults.

 

 

ARTICLE V

 

COSTS AND EXPENSES

 

5.1                               All actual expenses related to the creation of the Equity Pledge under this Agreement, including but not limited to the stamp duty, any other taxes and all legal fees and etc., shall be assumed by the Parties respectively.

 

ARTICLE VI

 

CONTINUITY AND NO WAIVER

 

6.1                               The Equity Pledge created under this Agreement is a continuing assurance, which shall be valid until the Contractual Obligations are fully performed or the Secured Liabilities are fully discharged. No waiver or grace period of any default of the Pledgors given by the Pledgee, nor the Pledgee’s delayed exercise of any of its rights under the Transaction Documents and this Agreement, shall affect the rights of the Pledgee under this Agreement, the Transaction Documents and the relevant PRC Law to require at any time thereafter the Pledgors to strictly implement the Transaction Documents and this Agreement, or the rights the Pledgee is entitled to with respect to the Pledgors’ subsequent breach of the Transaction Documents and/or this Agreement.

 

ARTICLE VII

 

UNDERTAKINGS BY THE COMPANY

 

Each of the Pledgors respectively represents and warrants to the Pledgee as follows:

 

7.1                               The Pledgors are PRC citizens with full legal capacity, having full rights and powers to execute this Agreement and assume the legal obligations in accordance with this Agreement.

 

7.2                               All the reports, documents and information related to the Pledgors and all the matters required under this Agreement that the Pledgors provided to the Pledgee prior to the effectiveness of this Agreement are true and accurate in all material respects as of the effectiveness of this Agreement.

 

7.3                               All the reports, documents and information related to the Pledgors and all the matters required under this Agreement to be provided by the Pledgors to the Pledgee after the effectiveness of this Agreement will be true and valid in all material respects at the time of provision.

 

7.4                               As of the effectiveness of this Agreement, the Pledgors are the sole legal owners of the Pledged Equity Interest. There is no then pending disputes on the ownership of the Pledged Equity Interest. The Pledgors are entitled to dispose of the Pledged Equity Interest or any part thereof.

 

 

7.5                               Except the security interest created over the Pledged Equity Interest under this Agreement and the rights created under the Transaction Documents, there are no other security interest or third party rights or any other encumbrance over the Pledged Equity Interest.

 

7.6                               The Pledged Equity Interest can be legally pledged and transferred, and the Pledgors have full rights and powers to pledge the Pledged Equity Interest to the Pledgee in accordance with the provisions of this Agreement.

 

7.7                               This Agreement, upon due execution by the Pledgors, constitutes the lawful, valid and binding obligations of the Pledgors.

 

7.8                               Any third party approvals, permits, waivers and authorizations, any approvals, permits and waivers of any governmental authorities, or any registration or filing formalities with any government authorities (if legally required), which is required with respect to the execution and performance of this Agreement and the Equity Pledge under this Agreement, have been obtained or completed (subject to clause 2 of Article 2.2), and will be fully effective during the valid term of this Agreement.

 

7.9                               Each Pledgor’s execution and performance of this Agreement does not violate or conflict with any laws applicable thereto, any agreement to which it is a party or by which its assets are bound, any court adjudication, any arbitration award or any decision of administrative authorities.

 

7.10                        The pledge under this Agreement constitutes the security interest over the Pledged Equity Interest with the first priority.

 

7.11                        All taxes and expenses payable for obtainment of the Pledged Equity Interest have been paid by the Pledgors in full.

 

7.12                        There is no pending or, to the knowledge of the Pledgors, threatened lawsuit, legal proceeding or claim at any court or arbitration tribunal against the Pledgors or their property or the Pledged Equity Interest, nor is there any pending or, to the knowledge of the Pledgors, threatened lawsuit, legal proceeding or claim at any government agency or administrative authority against the Pledgors or their property or the Pledged Equity Interest, which will have material or adverse effect on the financial conditions of the Pledgors or their abilities to perform their obligations and security liabilities under this Agreement.

 

7.13                        The Pledgors hereby undertake to the Pledgee that the above representations and warranties will all be true and accurate and be fully complied with under any circumstances and at any time before the Contractual Obligations are performed in full or the Secured Liabilities are discharged in full.

 

 

ARTICLE VIII

 

COMPANY’S REPRESENTATIONS AND WARRANTIES

 

The Company represents and warrants to the Pledgee as follows:

 

8.1                               The Company is a limited liability company duly registered and lawfully existing under the PRC Law with independent legal person status, having independent and full legal status and capacity to execute, deliver and perform this Agreement, and can be an independent party to a lawsuit.

 

8.2                               All the reports, documents and information related to the Pledged Equity Interest and all the matters required under this Agreement which the Company provided to the Pledgee prior to the effectiveness of this Agreement are true and accurate in all material respects as of the effectiveness of this Agreement.

 

8.3                               All the reports, documents and information related to the Pledged Equity Interest and all the matters required under this Agreement to be provided by the Company to the Pledgee after the effectiveness of this Agreement will be true and valid in all material respects at the time of provision.

 

8.4                               This Agreement, upon due execution by the Company, constitutes the lawful, valid and binding obligations of the Company.

 

8.5                               It has full internal corporate power and authorization to execute and deliver this Agreement and all other documents related to the transaction contemplated in this Agreement and to be executed by it. It has full power and authorization to consummate the transaction contemplated in this Agreement.

 

8.6                               There is no pending or, to the knowledge of the Company, threatened lawsuit, legal proceeding or claim at any court or arbitration tribunal against the Pledged Equity Interest, the Company or its assets, nor is there any pending or, to the knowledge of the Company, threatened lawsuit, legal proceeding or claim at any government agency or administrative authority against the Pledged Equity Interest, the Company or its assets, which will have material or adverse effect on the financial conditions of the Company or the Pledgors’ abilities to perform their obligations and security liabilities under this Agreement.

 

8.7                               The Company hereby agrees to assume the joint and several liabilities to the Pledgee with respect to the representations and warranties made by each of the Pledgors under Article 7.4, Article 7.5, Article 7.6, Article 7.8 and Article 7.10 of this Agreement.

 

8.8                               The Company hereby undertakes to the Pledgee that the above representations and warranties will all be true and accurate and be fully complied with under any circumstance and at any time before the Contractual Obligations are performed in full and the Secured Liabilities are discharged in full.

 

 

ARTICLE IX

 

PLEDGORS’ UNDERTAKINGS

 

Each Pledgor hereby respectively undertakes to the Pledgee as follows:

 

9.1                               Without the prior written consent of the Pledgee, the Pledgors shall not create, or allow to be created, any new pledge or any other security interest over the Pledged Equity Interest. Any pledge or other security interest created over all or any part of the Pledged Equity Interest without the prior written consent of the Pledgee shall be invalid.

 

9.2                               Without the prior written notice to and the prior written consent of the Pledgee, the Pledgors shall not transfer the Pledged Equity Interest and no proposed transfer of the Pledged Equity Interest by the Pledgors shall be invalid. The proceeds obtained from the Pledgors’ transfer of the Pledged Equity Interest shall be used first to prepay the Secured Liabilities to the Pledgee or to be deposited with a third party as agreed with the Pledgee.

 

9.3                               In the event of occurrence of any lawsuit, arbitration or other claim which may have adverse effect on the interests of the Pledgors or the Pledgee under the Transaction Documents and this Agreement or on the Pledged Equity Interest, the Pledgors undertake to notify the Pledgee in writing as soon as possible and in a timely manner, and, as reasonably required by the Pledgee, to take all necessary measures to ensure the pledge interest of the Pledgee over the Pledged Equity Interest.

 

9.4                               The Pledgors undertake to complete the registration formalities to extend the business term of the Company within three months prior to the expiration of the business term of the Company so as to continue the effect of this Agreement.

 

9.5                               The Pledgors shall not take, or allow to be taken, any act or action which may have adverse effect on the Pledgee’s interests under the Transaction Documents and this Agreement or on the Pledged Equity Interest. The Pledgors waive the right of first refusal to purchase the Pledged Equity Interest when the Pledgee realizes its pledge rights.

 

9.6                               The Pledgors shall, after the signing of this Agreement, use their best efforts and take all necessary measures to register the Equity Pledge under this Agreement with the relevant administration of industry and commerce as soon as possible, and the Pledgors undertake to, as reasonably required by the Pledgee, take all necessary measures and execute all necessary documents (including but not limited to any agreement supplemental to this Agreement) to ensure the pledge interest of the Pledgee over the Pledged Equity Interest and the exercise and realization thereof.

 

9.7                               If the exercise of the right of pledge under this Agreement results in the transfer of any Pledged Equity Interest, the Pledgors undertake to take all measures to effect such transfer.

 

 

9.8                               The Pledgors shall ensure that the convening process, voting methods and content of the shareholders meetings and board meetings of the Company convened for the purpose of the execution of this Agreement, creation and exercise of the right of pledge under this Agreement be not in conflict with the laws, administrative regulations or the articles of association of the Company.

 

ARTICLE X

 

COMPANY’S UNDERTAKINGS

 

10.1                        If any third party approval, permit, waiver or authorization, or any approval, permit or waiver of any governmental authorities, or any registration or filing formalities with any government authorities (if legally required) is required to be obtained or completed for the execution and performance of this Agreement and for the Equity Pledge under this Agreement, the Company shall endeavor to assist in obtaining it and keeping it fully effective throughout the valid term of this Agreement.

 

10.2                        Without the prior written consent of the Pledgee, the Company shall not assist in or allow the Pledgors’ creation of any new pledge or other security interest over the Pledged Equity interest.

 

10.3                        Without the prior written consent of the Pledgee, the Company shall not assist in or allow the Pledgors’ transfer of the Pledged Equity Interest.

 

10.4                        In the event of occurrence of any lawsuit, arbitration or other claim which may have adverse effect on the Company, the Pledged Equity Interest or the Pledgee’s interests under the Transaction Documents and this Agreement, the Company undertakes to notify the Pledgee in writing as soon as possible and in a timely manner, and, as reasonably required by the Pledgee, to take all necessary measures to ensure the pledge interest of the Pledgee over the Pledged Equity Interest.

 

10.5                        The Company undertakes to complete the registration formalities to extend its business term within three months prior to the expiration of its business term so as to continue the effect of this Agreement.

 

10.6                        The Company shall not take, or allow to be taken, any act or action which may have adverse effect on the Pledgee’s interests under the Transaction Documents and this Agreement or on the Pledged Equity Interest, including but not limited to any act or action subject to the restrictions under Article 9.

 

10.7                        The Company shall, in the first month of each calendar quarter, provide the Pledgee with the financial statements of the Company for the immediately preceding calendar quarter, including but not limited to the balance sheet, the profit and loss statements and the cash flow statements.

 

 

10.8                        The Company undertakes to, as reasonably required by the Pledgee, take all necessary measures and execute all necessary documents (including but not limited to any agreement supplemental to this Agreement) to ensure the pledge interest of the Pledgee over the Pledged Equity Interest and the exercise and realization thereof.

 

10.9                        If the exercise of the right of pledge under this Agreement results in the transfer of any Pledged Equity Interest, the Company undertakes to take all measures to effect such transfer.

 

ARTICLE XI

 

CHANGE OF CIRCUMSTANCES

 

11.1                        As a supplement to, and not in conflict with, the Transaction Documents and the other provisions of this Agreement, if at any time, due to the promulgation or change of any PRC Law, regulations or rules, or the change of interpretation or application of such laws, regulations or rules, or the change of relevant registration procedures, the Pledgee believes that it is illegal or in conflict with  such laws, regulations and rules to keep this Agreement effective, to keep the right of pledge under this Agreement effective and/or to dispose of the Pledged Equity Interest in accordance with this Agreement, the Pledgors and the Company shall promptly take any action and/or execute any agreement or other document upon written instruction by the Pledgee and as reasonably required by the Pledgee, so as to:

 

(1)                                 keep this Agreement and the right of pledge under this Agreement effective;

 

(2)                                 facilitate the disposal of the Pledged Equity Interest in accordance with this Agreement; and/or

 

(3)                                 keep or realize the security created or intended to be created by this Agreement.

 

ARTICLE XII

 

EFFECTIVENESS AND TERM OF THIS AGREEMENT

 

12.1                        This Agreement shall come into effect upon the satisfaction of all of the following conditions:

 

(1)                                 this Agreement has been duly executed by the Parties;

 

(2)                                 the Equity Pledge under this Agreement has been duly registered on the register of shareholders of the Company.

 

The Pledgors shall provide the Pledgee with the evidence of the registration of the Equity Pledge on the register of shareholders in a form to the satisfaction of the Pledgee, and shall, after the registration of the Equity Pledge is completed and as required by the Pledgee,  provide the Pledgee with the pledge certificate issued by the administration of industry and commerce in a form to the satisfaction of the Pledgee.

 

 

12.2                        The term of this Agreement shall end upon the full performance of the Contractual Obligations or the full discharge of the Secured Liabilities.

 

ARTICLE XIII

 

NOTICES

 

13.1                        Any notice, request, demand and other correspondences required by this Agreement or made in accordance with this Agreement shall be delivered in writing to the relevant Party.

 

13.2                        If any of such notice or other correspondences is transmitted by facsimile or telex, it shall be treated as delivered immediately upon transmission; if delivered in person, it shall be treated as delivered at the time of delivery; if posted by mail, it shall be treated as delivered five (5) days after posting.

 

ARTICLE XIV

 

MISCELLANEOUS

 

14.1                        The Pledgors and the Company agree that the Pledgee may, upon notice to the Pledgors and the Company, assign the Pledgee’s rights and/or obligations hereunder to any third party. However, neither Pledgors nor the Company shall, without the Pledgee’s prior written consent, assign their rights, obligations or liabilities hereunder to any third party. The respective successors or permitted assigns (if any) of the Pledgors and the Company shall continue to perform the respective obligations of the Pledgors and the Company under this Agreement.

 

14.2                        The amount of the Secured Liabilities determined by the Pledgee at its own discretion when the Pledgee exercises its right of pledge to the Pledged Equity Interest pursuant to the provisions hereof hall be regarded as the conclusive evidence of the Secured Liabilities hereunder.

 

14.3                        This Agreement is written in Chinese and executed in five (5) originals, with one (1) original to be retained by each Party hereto. One (1) original is to be used for the application to the administration of industry and commerce in charge of the Company for registration of the Equity Pledge under this Agreement.

 

14.4                        The execution, effectiveness, performance, revision, interpretation and termination of this Agreement shall be governed by the PRC Law.

 

14.5                        Any dispute arising out of and in connection with this Agreement shall be resolved through consultations among the Parties. In case the Parties fail to reach agreement within thirty (30) days after the dispute arises, such dispute shall be submitted to China International Economic and Trade Arbitration Commission Shanghai Commission for arbitration in Shanghai in accordance with such Commission’s arbitration rules in effect at the time of applying for arbitration, and the arbitration award shall be final and binding on the Parties.

 

 

14.6                        None of the rights, powers or remedies granted to any Party by any provision herein shall preclude any other rights, powers or remedies available to such Party at law and under the other provisions of this Agreement. In addition, the exercising by one Party of any of its rights, powers and remedies shall not exclude such Party from exercising any of its other rights, powers and remedies.

 

14.7                        No failure or delay by a Party in exercising any rights, powers and remedies available to it hereunder or at law (the “Available Rights”) shall result in a waiver thereof, nor shall the waiver of any single or partial exercise of the Available Rights shall exclude such Party from exercising such rights in any other way and exercising the other Available Rights.

 

14.8                        The headings of the provisions herein are for reference only, and in no event shall such headings be used for or affect the interpretation of the provisions hereof.

 

14.9                        Each provision contained herein shall be severable and independent from each of the other provisions. If any one or more provisions herein become(s) invalid, illegal or unenforceable at any time, the validity, legality and enforceability of the remaining provisions herein shall not be affected as a result thereof.

 

14.10                 Any amendments or supplements to this Agreement shall be made in writing. Except for assignment by the Pledgee of its rights hereunder according to Article 14.1, the amendments or supplements to this Agreement shall take effect only upon the due execution by the Parties to this Agreement. If any amendments or supplements to this Agreement legally require any approval of and/or any registration or filing with any government authority, the Parties shall obtain such approval and/or complete such registration or filing in accordance with law.

 

14.11                 This Agreement shall be binding on the legal successors of the Parties.

 

14.12                 Simultaneously with the execution of this Agreement, each Pledgor shall respectively sign a power of attorney (the “Power of Attorney”) to authorize any person designated by the Pledgee to sign on the Pledgor’s behalf according to this Agreement any and all legal documents necessary for the exercise of the Pledgee’s rights hereunder. Such Power of Attorney shall be delivered to the Pledgee to keep in custody and, when necessary, the Pledgee may at any time submit the Power of Attorney to the relevant government authority.

 

[The remainder of this page intentionally left blank]

 

 

[EXECUTION PAGE]

 

IN WITNESS WHEREOF, this EQUITY PLEDGE AGREEMENT is executed by the following Parties on the date first written above.

 

	
Qimin WU
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Qimin WU
    	
 
    
	
 
    	
 
    	
 
    
	
Tianxiang HU
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Tianxiang HU
    	
 
    
	
 
    	
 
    	
 
    
	
Baoyi Investment   Consulting (Shanghai) Co., Ltd.
    	
 
    
	
(Seal)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/seal/ Baoyi Investment Consulting   (Shanghai) Co., Ltd.
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Shanghai E-Cheng Asset Management Co., Ltd.
    	
 
    
	
(Seal)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/seal/ Shanghai E-Cheng Asset Management   Co., Ltd.
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    

 

 

Annex 1:

 

Company’s General Information

 

	
Company name:
    	
 
    	
Shanghai E-Cheng Asset Management Co., Ltd.
    
	
 
    	
 
    	
 
    
	
Registered address:
    	
 
    	
Room 221 Block 1, 195 Yong He Zhi Road, Zhabei   district, Shanghai
    
	
 
    	
 
    	
 
    
	
Registered capital:
    	
 
    	
RMB1,000,000
    
	
 
    	
 
    	
 
    
	
Legal representative:
    	
 
    	
Qimin WU
    

 

	
Shareholder’s name
    	
 
    	
Contribution in
   registered capital
    	
 
    	
Percentage of
   contribution
    	
 
    	
Method of
   contribution
    	
 
    
	
Qimin WU
    	
 
    	
RMB
    	
700,000
    	
 
    	
70
    	
%
    	
Cash
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Tianxiang HU
    	
 
    	
RMB
    	
300,000
    	
 
    	
30
    	
%
    	
Cash
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Total
    	
 
    	
RMB
    	
1,000,000
    	
 
    	
100
    	
%
    	
/
    	
 
    

 

 

Annex 2:

 

FORM OF POWER OF ATTORNEY

 

I, [*], hereby irrevocably delegate [*] (identity card number: [*]) to act as my authorized representative to execute all legal documents necessary or useful for Baoyi Investment Consulting (Shanghai) Co., Ltd. to exercise its rights under the “Equity Pledge Agreement regarding Shanghai E-Cheng Asset Management Co., Ltd.” entered into by Shanghai E-Cheng Asset Management Co., Ltd., it and me.

 

	
 
    	
Signature:
    
	
 
    	
Date:ex_110071.htm

 

 

 

 

 

EXHIBIT 4.7

 

 

 

 

 

 

 

 

AMERICANN, INC.

 

WARRANT TO PURCHASE COMMON STOCK

 

SERIES VIII

 

 

This is to certify that, FOR VALUE RECEIVED, _________, or registered assigns (“Holder”), is entitled to purchase, subject to the provisions of this Warrant, from AmeriCann, Inc. (the “Company”), __________ shares of the common stock of the Company (“Common Stock”). This Warrant may be exercised at a purchase price of $1.50 per share at any time on or prior to October 17, 2022. The number of shares of Common Stock to be received upon the exercise of this Warrant and the price to be paid for a share of Common Stock may be adjusted from time to time as hereinafter set forth. The shares of Common Stock deliverable upon such exercise, as may be adjusted from time to time, are hereinafter sometimes referred to as “Warrant Stock”; and the exercise price of a share of Common Stock in effect at any time, and as may be adjusted from time to time, is hereinafter sometimes referred to as the "Exercise Price."

 

(a) Exercise of Warrant. This Warrant may be exercised in whole or in part at any time or from time to time but not later than 5.00 P.M., Mountain time, on October 17, 2022. If the Expiration Date is a day on which banking institutions are authorized by law to close, then this Warrant may be exercised on the next succeeding day which shall not be such a day, by presentation and surrender of this Warrant to the Company or at the office of its stock transfer agent, if any, with the Purchase Form annexed hereto duly executed and accompanied by payment of the Exercise Price for the number of Shares of Warrant Stock specified in such form, together with all Federal and state taxes applicable upon such exercise.

 

If this Warrant should be exercised in part only, the Company, upon surrender of this Warrant for cancellation, shall execute and shall deliver a new Warrant evidencing the right of the Holder to purchase the balance of the Shares of Warrant Stock purchasable hereunder. Upon receipt by the Company of this Warrant at the office or the agency of the Company, in proper form for exercise, the Holder shall be deemed to be the Holder of record of the Shares of Warrant Stock issuable upon such exercise, notwithstanding that the stock transfer books of the Company shall then be closed or that certificates representing such Shares of Warrant Stock shall not then be actually delivered to the Holder.

 

(b) Reservation of Shares of Warrant Stock. The Company hereby agrees that, at all times, there shall be reserved for issuance and/or delivery upon exercise of this Warrant such number of shares of its Common Stock as shall be required for issuance or delivery upon exercise of this Warrant.

 

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(c)    Fractional Shares. No fractional Shares of Warrant Stock or scrip representing fractional Shares of Warrant Stock shall be issued upon the exercise of this Warrant. With respect to any fraction of a Share of Warrant Stock called for upon any exercise hereof, the Company shall pay to the Holder an amount in cash equal to such fraction multiplied by the current market value of such fractional share determined as follows:

 

(i)     If the Company's Common Stock is publicly traded, the average daily closing prices for 30 consecutive trading days immediately preceding the date of exercise of this Warrant. The closing price for each day shall be the last sale price regular-way or, in case no such sale takes place on such date, the average of the closing bid and asked prices regular-way, on the principal national securities exchange in which the Company's Common Stock is listed or admitted to trading, or if it is not listed or admitted to trading on any national securities exchange, the last sale price of such Common Stock on the consolidated transaction reporting system of the National Association of Securities Dealers ("NASD"), if such last sale information is reported on such system, or if not so reported, the average of the closing bid and asked prices of such Common Stock on the National Association of Securities Dealers Automatic Quotation system ("NASDAQ"), or any comparable system, or if the Common Stock is not listed on NASDAQ, or a comparable system, the average of the closing bid and asked prices as furnished by two members of the NASD selected from time to time by the Company for that purpose.

 

(ii)     If the Company's Common Stock is not publicly traded, the current value shall be an amount, not less than the book value, determined in such reasonable manner as may be prescribed by the Board of Directors of the Company, such determination to be final and binding on the Holder.

 

(d)     Exchange, Assignment or Loss of Warrant. This Warrant is exchangeable, without expense, at the option of the Holder, upon presentation and surrender hereof to the Company or at the office of its stock transfer agent, if any, for other Warrants of different denominations entitling the Holder thereof to purchase in the aggregate the same number of Shares of Warrant Stock purchasable hereunder. This Warrant may not be sold, hypothecated, assigned, or transferred prior to the date this Warrant is first exercisable. Any assignment shall be made subject to the provisions of Section (j) by surrender of this Warrant to the Company or at the office of its stock transfer agent, if any, with the Assignment Form annexed hereto duly executed and with funds sufficient to pay any transfer tax; whereupon, the Company, without charge, shall execute and shall deliver a new Warrant in the name of the assignee named in such instrument of assignment and this Warrant shall promptly be cancelled.

 

This Warrant may be divided or may be combined with other Warrants which carry the same rights upon presentation hereof at the office of the Company or at the office of its stock transfer agent, if any, together with a written notice specifying the names and the denominations in which new Warrants are to be issued and signed by the Holder hereof. The term "Warrant" as used herein includes any Warrants issued in substitution for or replacement of this Warrant or into which this Warrant may be divided or exchanged. Upon receipt by the Company of evidence satisfactory to it of the loss, theft, destruction, or mutilation of this Warrant, and (in the case of loss, theft, or destruction) of reasonably satisfactory indemnification, and upon surrender and cancellation of this Warrant, if mutilated, the Company will execute and will deliver a new Warrant of like tenor and date. Any such new Warrant executed and delivered shall constitute an additional contractual obligation on the part of the Company, whether or not this Warrant so lost, stolen, destroyed or mutilated shall be at any time enforceable by anyone.

 

(e)     Rights of the Holder. The Holder, by virtue hereof, shall not be entitled to any rights of a stockholder in the Company, either at law or in equity, and the rights of the Holder are limited to those expressed in the Warrant and are not enforceable against the Company except to the extent set forth herein.

 

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(f)     Anti-Dilution Provisions.

 

(i)      Adjustment of Price. Anything in this Section (f) to the contrary notwithstanding, if the Company shall issue, at any time, Common Stock or convertible securities by way of dividend, forward stock split or other distribution on any stock of the Company or subdivide or combine the outstanding shares of Stock, the Exercise Price shall be proportionately decreased in the case of such issuance, forward stock split, or distribution (on the day following the date fixed for determining shareholders entitled to receive such additional shares) or proportionately increased in the case of such combination (on the date that such combination shall become effective), provided, however, should the Company cancel or fail to make such dividend or other distribution or other issuance, the Exercise Price shall be forthwith adjusted to the price which would have prevailed prior to the Company setting such record date.

 

(ii)     No Adjustment for Small Amounts. Anything in this Section to the contrary notwithstanding, the Company shall not be required to give effect to any adjustment in the Exercise Price unless and until the net effect of one or more adjustments, determined as above provided, shall have required a change of the Exercise Price by at least one cent, but when the cumulative net effect of more than one adjustment so determined shall be to change the actual Exercise Price by at least one cent, such change in the Exercise Price shall thereupon be given effect.

 

(iii)     Number of Shares Adjusted. Upon any adjustment of the Exercise Price, the Holder of this Warrant shall thereafter (until another such adjustment) be entitled to purchase, at the new Exercise Price, the number of Shares of Warrant Stock, calculated to the nearest full shares, obtained by multiplying the number of shares of Stock initially issuable upon exercise of this Warrant by the Exercise Price in effect on the date hereof and dividing the product so obtained by the new Exercise Price.

 

(g)     Officer's Certificate. Whenever the Exercise Price shall be adjusted as required by the provisions of Section (f) hereof, the Company shall forthwith file with its Secretary or an Assistant Secretary at its principal office, and with its stock transfer agent, if any, an Officer's Certificate showing the adjusted Exercise Price, determined as herein provided, and setting forth in reasonable detail the facts requiring such adjustment. Each such Officer's Certificate shall be made available at all reasonable times for inspection by the Holder; and the Company, after each such adjustment, shall forthwith deliver a copy of such certificate to the Holder. Such certificate shall be conclusive as to the correctness of such adjustment.

 

(h)     Notices to Warrant Holders. So long as this Warrant shall be outstanding and unexercised (i) if the Company shall pay any dividend or shall make any distribution upon the Common Stock or (ii) if the Company shall offer to the holders for subscription or purchase by them any shares of stock of any class or any other rights or (iii) if any capital reorganization of the Company; reclassification of the capital stock of the Company; consolidation or merger of the Company with or into another corporation; sale, lease or transfer of all or substantially all of the property and assets of the Company to another corporation; or voluntary or involuntary dissolution, liquidation, or winding up of the Company shall be effected, then, in any such case, the Company shall cause to be delivered to the Holder, at least ten (l0) days prior to the date specified in (x) or (y) below, as the case may be, a notice containing a brief description of the proposed action and stating the date on which (x) a record is to be taken for the purpose of such dividend, distribution, or rights, or (y) such reclassification, reorganization, consolidation, merger, conveyance, lease, dissolution, liquidation, or winding up is to take place and the date, if any, is to be fixed, as of which the holders of record shall be entitled to exchange their Shares for securities or other property deliverable upon such reclassification, reorganization, consolidation, merger, conveyance, dissolution, liquidation, or winding up.

 

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(i)     Reclassification, Reorganization or Merger. In case of any reclassification, or capital reorganization (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of an issuance of Common Stock by way of dividend or other distribution or of a subdivision or combination), or in case of any consolidation or merger of the Company with or into another corporation (other than a merger with a subsidiary, in which merger the Company is the continuing corporation and which does not result in any reclassification, or capital reorganization) or in case of any sale or conveyance to another corporation of the property of the Company as an entirety or substantially as an entirety, the Company shall cause effective provision to be made so that the Holder shall have the right thereafter, by exercising this Warrant, to purchase the kind and amount of shares of Stock and other securities and property receivable upon such reclassification; capital reorganization; or other consolidation, merger, sale, or conveyance as may be issued or payable with respect to or in exchange for the number of Shares of the Company theretofore purchasable upon the exercise of this Warrant had such recapitalization; capital reorganization; or other consolidation, merger, sale or conveyance not taken place. Any such provisions shall include provision for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Warrant. The foregoing provisions of this Section (i) shall similarly apply to successive reclassifications; capital reorganizations; and to successive consolidations, mergers, sales, or conveyances.

 

In the event that in any such capital reorganization or reclassification, consolidation, merger, sale or conveyance, additional shares shall be issued in exchange, conversion, substitution or payment, in whole or in part, for a security of the Company other than Stock, any such issue shall be treated as an issue of Stock covered by the provisions of subsection (f) hereof with the amount of the consideration received upon the issue thereof being determined by the Board of Directors of the Company, such determination to be final and binding on the Holder.

 

(j)     Transfer to Comply with the Securities Act of l933.

 

(i)     This Warrant or the Warrant Stock or any other security issued or issuable upon exercise of this Warrant may not be sold, transferred, or otherwise disposed of except to a person who, in the opinion of counsel for the Company, is a person to whom this Warrant or such Warrant Stock may legally be transferred pursuant to Section (d) hereof without registration and without the delivery of a current Prospectus under the Act with respect thereto and then only against receipt of an agreement of such person to comply with the provisions of this Section (k) with respect to any resale or other disposition of such securities.

 

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(ii)     The Company may cause the following legend or one similar thereto to be set forth on each certificate representing Warrant Stock or any other security issued or issuable upon exercise of this Warrant not theretofore distributed to the public or sold to underwriters for distribution to the public pursuant to Section (j) hereof, unless counsel for the Company is of the opinion as to any such certificate that such legend is unnecessary:

 

The shares represented by this Certificate have not been registered under the Securities Act of l933 (the "Act") and are "restricted securities" as that term is defined in Rule 144 under the Act. The shares may not be offered for sale, sold, or otherwise transferred except pursuant to an effective registration statement under the Act or pursuant to an exemption from registration under the Act, the availability of which is to be established to the satisfaction of the Company.

 

(l)     Applicable Law. This Warrant shall be governed by and construed in accordance with the laws of Delaware.

 

 

 

	February ___, 2018	AMERICANN, INC.	 
	 	 	 
	 	 	 
	 	By	 	 
	 	 	Timothy Keogh, Chief Executive Officer	 

 

 

 

 

 

 

 

 

 

 

AmeriCann Warrant $1.50 2-19-18

 

5

 

 

PURCHASE FORM

 

Dated            .

 

The undersigned hereby irrevocable elects to exercise the within Warrant to the extent of purchasing         Shares of Warrant Stock and hereby makes payment of $                   in payment of the actual exercise price thereof.

 

 

 

INSTRUCTIONS FOR REGISTRATION OF STOCK

 

Name                                                                                     

                  (Please typewrite or print in block letters)

 

Address                                                                   

                                                                  

 

Signature                                                                 

 

ASSIGNMENT FORM

 

FOR VALUE RECEIVED,                                                hereby sells, assigns, and transfers unto:

 

Name:                                                                                      

                     (Please typewrite or print in block letters)

 

Address                                                                   

                                                                  

 

the right to purchase the Common Stock represented by this Warrant to the extent of              shares as to which such right is exercisable and does hereby irrevocably constitute and appoint                    attorney, to transfer the same on the books of the Company with full power of substitution in the premises.

 

 

	Dated:                      .	Signature                                                 

 

 

 

 

 

AmeriCann Warrant $1.50 2-19-18

 

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