Document:

exv4w34

Exhibit 4.34

Translation

January 6, 2011

Equity Pledge Agreement

by and among

Han Junping

Xiong Wei

and

The9 Computer Technology Consulting (Shanghai) Co., Ltd.

Regarding

Shanghai Huopu Cloud Computing Terminal Technology Co., Ltd.

 

 

 

Equity Pledge Agreement

This Equity Pledge Agreement (hereinafter this “Agreement”) is entered into in Shanghai, the
People’s Republic of China (hereinafter “PRC”) as of January 6, 2011 by and among the
following Parties:

	(1)	 	Han Junping, a PRC citizen with his identity card number:                      and his
domicile address at                                         ;
	 
	(2)	 	Xiong Wei, a PRC citizen with his identity card number:                      and his
domicile address at                                         ;

(Han Junping and Xiong Wei are hereinafter referred individual and collectively to as the
“Pledgor(s)”)

	(3)	 	The9 Computer Technology Consulting (Shanghai) Co., Ltd., a company
with limited liability incorporated in Shanghai, the PRC with its
registered address at Room 103, Building 3, No. 690 Bibo Road,
Zhangjiang Hi-Tech Park, Shanghai, PRC (hereinafter the “Pledgee”).

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

WHEREAS:

	(1)	 	The Pledgors are the shareholders of Shanghai Huopu Cloud Computing
Terminal Technology Co., Ltd. (a company with limited liability
established and validly existing under the PRC Law, hereinafter the
“Company”) whose names appear on the register of members of the
Company, legally holding all equity interests of the Company
(hereinafter the “Company’s Equity”), and the capital contribution and
equity ratio of the Pledgors in the registered capital of the Company
as of the date of this Agreement is set out in Appendix I hereto.

	(2)	 	The Parties hereto entered into the Exclusive Call Option Agreement
dated December 13, 2010 (hereinafter the “Call Option Agreement”),
pursuant to which the Pledgors shall, to the extent permitted by the
PRC Law, transfer at the request of the Pledgee all or part of their
respective equity interests in the Company to the Pledgee and/or any
other entities or persons designated by it.

	(3)	 	The Parties hereto entered into the Shareholder Voting Proxy
Agreement dated December 13, 2010 (hereinafter the “Voting Right Proxy
Agreement”), pursuant to which the Pledgors shall irrevocably entrust
any person then designated by the Pledgee with full power to exercise
on their behalf all of their shareholders’ voting rights in the
Company.

 

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	(4)	 	Pursuant to the Loan Agreement dated December 13, 2010 between the
Pledgee and the Pledgors (hereinafter the “Loan Agreement”), the
Pledgee has already provided the Pledgors with a loan totaling Fifty
Million Renminbi (RMB50,000,000), which shall be repaid, in the sole
discretion of the Pledgee, by the Pledgors immediately when the
Pledgee makes a repayment request to the Pledgors in writing.
	 
	(5)	 	As the guarantee by the Pledgors for the performance of their
Contractual Obligations (as defined below) and repayment of their
Guaranteed Liabilities (as defined below), the Pledgors agree to
pledge all of the Company’s Equity owned by them to the Pledgee, and
grants herewith to the Pledgee the right of first priority in the
pledge.

Therefore, the Parties have reached the following agreement upon mutual consultations:

Article 1 — Definition

	1.1	 	Except as otherwise construed in the context, the following terms in
this Agreement shall be interpreted to have the following meanings:

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

“Guaranteed Liabilities” shall mean all direct, indirect and derivative losses and loss of
foreseeable profits suffered by the Pledgee due to any Event of Default (as defined below) of the
Pledgors and/or the Company, the amount of which shall be determined by the Pledgee in its absolute
sole discretion and by which the Pledgors shall be fully bound; and all costs incurred by the
Pledgee for its enforcement of the Contractual Obligations of the Pledgors.

“Transaction Agreements” shall mean the Loan Agreement, Call Option Agreement and Voting
Proxy Agreement.

“Event of Default” shall mean any breach by the Pledgors of their Contractual Obligations under the
Loan Agreement, Call Option Agreement, Voting  Proxy Agreement and/or this Agreement, and any
breach by the Company of its Contractual Obligations under the Voting  Proxy Agreement.

“Pledged Property” shall mean all of the Company’s Equity legally owned by the Pledgors when this
Agreement becomes effective and which will be pledged to the Pledgee according to the provisions
hereof as the guarantee for the performance by the Pledgors and the Company of their Contractual
Obligations (please see Appendix I hereto for the specific equity pledged by the Pledgors), and the
increased capital contributions and dividends described under Articles 2.6 and 2.7 hereof.

 

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“PRC Law” shall mean the laws, administrative regulations, administrative rules, local regulations,
judicial interpretations and other binding regulatory documents of the People’s Republic of China
then in effect.

	1.2	 	Any reference to the PRC Law herein shall be deemed (1) to include the
references to the amendments, changes, supplements and reenactments of
such law, irrespective of whether they take effect before or after the
formation 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	 	Except as otherwise stated in the context herein, all references to an
article, clause, item or paragraph shall refer to the relevant part of
this Agreement.

Article 2 — Equity Pledge

	2.1	 	The Pledgors hereby agree to pledge the Pledged Property which they
legally own and have the right to dispose of to the Pledgee according
to the provisions hereof as the guarantee for the performance of their
Contractual Obligations and repayment of their Guaranteed Liabilities.

	2.2	 	The Pledgors hereby undertake that they will be responsible for, on
the date hereof, recording the arrangement of the equity pledge
hereunder (hereinafter the “Equity Pledge”) on the register of members
of the Company. The Parties shall, immediately after the execution
hereof, make their best efforts to complete all formalities in
relation to the Equity Pledge with the industrial and commercial
registration authority to which the Company relates as soon as
possible.

	2.3	 	During the term of this Agreement, except for the willful material
negligence of the Pledgee or that such negligence is directly related
as cause/result to the consequence, the Pledgee shall not be liable in
any way to, nor shall the Pledgors have any right to claim in any way
or propose any demands on the Pledgee, in respect of the reduction in
value of the Pledged Property.

	2.4	 	Subject to compliance with Article 2.3 above, in case of any
possibility of obvious reduction in value of the Pledged Property
which is sufficient to jeopardize the Pledgee’s rights, the Pledgee
may demand the Pledgors to provide corresponding guarantee as
supplements. Where the Pledgors fail to do so, the Pledgee may at any
time auction or sell off the Pledged Property on behalf of the
Pledgors, and discuss with the Pledgors to use the proceeds from such
auction or sale-off as pre-repayment of the Guaranteed Liabilities, or
may submit such proceeds to the local notary institution where the
Pledgee is domiciled (any costs incurred in relation thereto shall be
borne by the Pledgors).
	 
	2.5	 	In case of any Event of Default, the Pledgee shall have the right to
dispose of the Pledged Property in the manner as set out in Article 4
hereof.

 

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	2.6	 	The Pledgors shall increase the capital of the Company unless with the
prior consent of the Pledgee. The increased capital contribution of
the Pledgors in the registered capital of the Company due to the
capital increase made by them shall also be deemed as part of the
Pledged Property.

	2.7	 	The Pledgors shall receive dividends or bonus from the Pledged
Property unless with the prior consent of the Pledgee. Any dividends
received by the Pledgors in connection with the Pledged Property shall
be deposited by the Company into the bank account designated by the
Pledgee, subject to the supervision of the Pledgee and used as the
Pledged Property to first repay the Guaranteed Liabilities.
	 
	2.8	 	The Pledgors agree that they will be jointly and severally liable to
the Pledgee for any Event of Default of the other Pledgors. Upon the
occurrence of the Event of Default, the Pledgors shall have the right
to dispose of any Pledged Property of any of the Pledgors pursuant to
this Agreement.

Article 3 — Release of Pledge

	3.1	 	After the Pledgors and the Company have fully and completely performed
all Contractual Obligations and repaid all Guaranteed Liabilities, the
Pledgee shall, at the request of the Pledgors, release the Equity
Pledge hereunder, and shall cooperate with the Pledgors to cancel the
record of the Equity Pledge in the register of members of the Company
and the registration thereof with the industrial and commercial
registration authority to which the Company relates. All reasonable
costs incurred by the release of the pledge shall be borne by the
Pledgors.

Article 4 — Disposal of the Pledged Property

	4.1	 	The Parties hereby agree that, in case of any Event of Default, the
Pledgee shall have the right to exercise, upon giving written notice
to the Pledgors, all remedies, rights and powers for breach available
to it under the PRC Law, Transaction Agreements and the terms hereof,
including (but not limited to) repayment in priority with proceeds
from auctions or sale-offs of the Pledged Property. The Pledgee shall
not be liable for any loss arising from its reasonable exercise of
such rights and powers.
	 
	4.2	 	The Pledgee shall have the right to designate in writing its legal
counsel or other agents to exercise on its behalf any and all rights
and powers set out above, and the Pledgors shall not oppose thereto.

	4.3	 	With regard to the reasonable costs incurred by the Pledgee in
connection with its exercise of any or all of the rights and powers
set out above, the Pledgee shall have the right to deduct such costs
in exact amount from the proceeds it acquires from the exercise of
such rights and powers.

 

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	4.4	 	The proceeds the Pledgee acquires from the exercise of its rights and
powers shall be used in the following order:

First, to pay any reasonable cost incurred in connection with the disposal of
the Pledged Property and the exercise by the Pledgee of its rights and powers
(including remuneration paid to its legal counsel and agents);

Second, to pay any taxes payable for the disposal of the Pledged Property; and

Third, to repay the Guaranteed Liabilities to the Pledgee.

In case of any balance after payment of the above amounts, the Pledgee shall return the same
to the Pledgors or other persons entitled thereto according to the relevant laws and
regulations, or submit the same to the local notary institution where the Pledgee is
domiciled (any costs incurred in relation thereto shall be borne by the Pledgors).

	4.5	 	The Pledgee shall have the option to exercise, simultaneously or in
certain sequence, any of the remedies for breach to which it is
entitled; the Pledgee shall not be required to exercise other remedies
for breach before its exercise of the right to the auctions or
sale-offs of the Pledged Property hereunder.

Article 5 — Costs and Expenses

	5.1	 	All actual expenses in connection with the creation of the Equity
Pledge hereunder, including (but not limited to) stamp duties, any
other taxes and all legal fees, etc shall be borne by the Pledgors and
the Pledgee, respectively.

Article 6 — Continuity and No Waiver

	6.1	 	The Equity Pledge hereunder is a continuous guarantee, the validity of
which shall continue until the full performance of the Contractual
Obligations or the full repayment of the Guaranteed Liabilities. No
exemption or grace period granted by the Pledgee in respect of any
breach of the Pledgors, nor delay by the Pledgee in exercising any of
its rights under the Transaction Agreements and this Agreement shall
affect the rights of the Pledgee under this Agreement, the relevant
PRC Law and the Transaction Agreements, the rights of the Pledgee to
demand at any time thereafter the strict performance of the
Transaction Agreements and this Agreement by the Pledgors or the
rights to which the Pledgee may be entitled due to any subsequent
breach by the Pledgors of the Transaction Agreements and/or this
Agreement.

Article 7 — Representations and Warranties

The Pledgors jointly and severally represent and warrant to the Pledgee as follows:

	7.1	 	The Pledgors are PRC citizen with full capacity, and have the legal
right and capacity to execute this Agreement and to bear legal
obligations hereunder.

 

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	7.2	 	All reports, documents and information concerning all issues of the
Pledgors and as required by this Agreement that are provided by the
Pledgors to the Pledgee prior to the effective date of this Agreement
are true and valid in all material aspects as of the effective date
hereof.

	7.3	 	All reports, documents and information concerning all issues of the
Pledgors and as required by this Agreement that are provided by the
Pledgors to the Pledgee after the effective date of this Agreement are
true and valid in all material aspects at the time of their
provisions.

	7.4	 	At the time of the effectiveness of this Agreement, the Pledgors are
the sole legal owner of the Pledged Property, with no existing dispute
whatever concerning the ownership of the Pledged Property. The
Pledgors have the right to dispose of the Pledged Property or any part
thereof.
	 
	7.5	 	Except for the encumbrance set on the Pledged Property hereunder and
the rights set under the Transaction Agreements, there is no other
encumbrance or third party interest set on the Pledged Property.

	7.6	 	The Pledged Property is capable of being pledged or transferred
according to the laws, and the Pledgors have the full right and power
to pledge the Pledged Property to the Pledgee according to this
Agreement.

	7.7	 	This Agreement constitutes the legal, valid and binding obligations on
the Pledgors when it is duly executed by the Pledgors.

	7.8	 	Any consent, permission, waiver or authorization by any third person,
or any approval, permission or exemption by any government authority,
or any registration or filing formalities (if required by laws) with
any government authority to be handled or obtained in respect of the
execution and performance hereof and the Equity Pledge hereunder have
already been handled or obtained, and will be fully effective during
the term of this Agreement.

	7.9	 	The execution and performance by the Pledgors of this Agreement are
not in violation of or conflict with any laws applicable to it, or any
agreement to which it is a party or which has binding effect on its
assets, any court judgment, any arbitration award, or any
administration authority decision.

	7.10	 	The pledge hereunder constitutes the encumbrance of first order in
priority on the Pledged Property.

	7.11	 	All taxes and costs payable in connection with acquisition of the
Pledged Property have already been paid in full by the Pledgors.
	 
	7.12	 	There is no pending or, to the knowledge of the Pledgors, threatened
litigation, legal proceeding or demand by any court or any arbitral
tribunal against the Pledgors, or their property, or the Pledged
Property, nor is there any pending or, to the knowledge of the
Pledgors, threatened litigation, legal proceeding or demand by any
government authority or any administration authority against the
Pledgors, or their property, or the Pledged Property, which is of
material or detrimental effect on the economic status of the Pledgors
or their capability to perform the obligations hereunder and the
Guaranteed Liabilities.

 

6

 

	7.13	 	The Pledgors hereby warrant to the Pledgee that the above
representations and warranties will be true and correct and fully
performed in all circumstances at any time before the Contractual
obligations are fully performed or the Guaranteed Liabilities are
fully repaid.

Article 8 — Undertakings by Pledgors

The Pledgors hereby severally and jointly undertake to the Pledgee as follows:

	8.1	 	In case that the value of the Pledged Property is detrimentally
affected due to any cause not attributable to the Pledgee, the
Pledgors shall, at the request of the Pledgee, provide the Pledgee
with further guarantee in the way and on the terms acceptable to the
Pledgee so as to supplement or replace the Pledged Property fully.

	8.2	 	Without the prior written consent of the Pledgee, the Pledgors shall
not further create or permit the creation of any new pledge or any
other encumbrance on the Pledged Property; any pledge or other
encumbrance on the whole or part of the Pledged Property created
without the prior written consent by the Pledgee shall be null and
void.

	8.3	 	Without first giving written notice to the Pledgee and having the
Pledgee’s prior written consent, the Pledgors shall not transfer the
Pledged Property, and any attempt by the Pledgors to transfer the
Pledged Property shall be null and void. The proceeds from any
transfer of the Pledged Property by the Pledgors shall be used to
repay to the Pledgee in advance the Guaranteed Liabilities or submit
the same to the third party as agreed with the Pledgee.

	8.4	 	In case of any litigation, arbitration or other demand which may
affect detrimentally the interest of the Pledgors or the Pledgee under
the Transaction Agreements and hereunder or the Pledged Property, the
Pledgors undertake to notify the Pledgee thereof in writing as soon as
possible and promptly and shall take, at the reasonable request of the
Pledgee, all necessary measures to ensure the pledged interest of the
Pledgee in the Pledged Property.

	8.5	 	The Pledgors shall not carry on or permit any act or action which may
affect detrimentally the interest of the Pledgee under the Transaction
Agreements and hereunder or the Pledged Property. The Pledgors shall
give up the right of first refusal to which they may be entitled when
the Pledgee realizes its right to the pledge.
	 
	8.6	 	The Pledgors shall, during the first month of each calendar quarter,
provide the Pledgee with the financial statement of the Company for
the preceding calendar quarter, including (but not limited to) its
balance sheet, profit statement and cash flow statement.

 

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	8.7	 	The Pledgors shall, after the execution hereof, make their best effort
and take all necessary means to complete the registration of the
Equity Pledge hereunder with the relevant industrial and commercial
administration departments as soon as possible. Moreover, the
Pledgors guarantee that they shall, at the reasonable request of the
Pledgee, take all necessary measures and execute all necessary
documents (including but not limited to supplementary agreement
hereof) so as to ensure the pledged interest of Pledgee in the Pledged
Property and the exercise and realization of the rights thereof.

	8.8	 	In case of assignment of any Pledged Property as a result of the
exercise of the right to the pledge hereunder, the Pledgors guarantee
that they will take all necessary measures to realize such assignment.
	 
	8.9	 	The Pledgors shall ensure that the procedures for convening
shareholders’ meetings and board meetings of the Company for the
purposes of executing this Agreement, creating the pledge and
exercising the right thereto, as well as the method of voting and
matters put for voting shall not in violation of laws, administrative
regulations or the articles of association of the Company.

Article 9 — Change of Circumstances

	9.1	 	As supplement and subject to compliance with other terms of the
Transaction Agreements and this Agreement, in case that at any time
the promulgation or change of any PRC Law, regulations or rules, or
change in interpretation or application of such laws, regulations and
rules, or the change of the relevant registration procedures enables
the Pledgee to believe that it will be illegal or in conflict with
such laws, regulations or rules to further maintain the effectiveness
of this Agreement and/or dispose of the Pledged Property in the way
provided herein, the Pledgors shall, at the written direction of the
Pledgee and in accordance with its reasonable request, promptly take
any action and/or execute any agreement or other document, in order
to:

	 	(1)	 	keep this Agreement and the right to the pledge hereunder remain in
effect;
	 
	 	(2)	 	facilitate the disposal of the Pledged Property in the way as provided
herein; and/or
	 
	 	(3)	 	maintain or realize the guarantee established or intended to establish
hereunder.

Article 10 — Effectiveness and Term of This Agreement

	10.1	 	This Agreement shall become effective upon the satisfaction of all of
the following conditions:

	 	(1)	 	this Agreement is duly executed by each of the Parties; and
	 
	 	(2)	 	the Equity Pledge hereunder has been legally recorded in the register
of members of the Company.

 

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After this Agreement becomes effective, the Pledgors shall, at the request of the Pledgee,
provide the registration certificate of the pledge issued by the industrial and commercial
administration departments to the Pledgee in a way that is satisfactory to the Pledgee.

	10.2	 	This Agreement shall have its valid term until the full performance
of the Contractual Obligations or the full repayment of the
Guaranteed Liabilities.

Article 11 — Notice

	11.1	 	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.

	11.2	 	Any such notice or other correspondences shall be deemed to have been
delivered, if sent by facsimile or telex, when it is sent, and if
delivered in person, when it is delivered, and if sent by post, five
(5) days after it was posted.

Article 12 — Miscellaneous

	12.1	 	Without the consent of the Pledgors, the Pledgee may assign its
rights and/or obligations hereunder to any third party after giving
notice to the Pledgors; however, the Pledgors shall not, without the
Pledgee’s prior written consent, assign their respective rights,
obligations and/or liabilities hereunder to any third party. Any
successors or permitted assignees (if any) of the Pledgors shall
continue to perform the obligations of the Pledgors under this
Agreement.

	12.2	 	The amount of the Guaranteed Liabilities determined by the Pledgee in
its sole discretion at the time when it exercises the right of pledge
to the Pledged Property according to this Agreement shall be the
conclusive evidence of the Guaranteed Liabilities hereunder.

	12.3	 	This Agreement is executed in Chinese in four (4) original copies,
with one (1) original to be retained by each party hereto, and one
original shall be used for the application for registration of the
Equity Pledge hereunder with the industrial and commercial
registration authority to which the Company relates.

	12.4	 	The formation, validity, execution, amendment, interpretation and
termination of this Agreement shall be governed by the PRC Laws.

	12.5	 	Any disputes arising out of and in connection with this Agreement
shall be resolved through consultations between the Parties. If the
Parties cannot reach an agreement regarding such disputes within
thirty (30) days of their occurrence, such disputes shall be
submitted to China International Economic and Trade Arbitration
Commission, Shanghai Branch, for arbitration in Shanghai in
accordance with the arbitration rules of such Commission, and the
arbitration award shall be final and binding on the Parties.

 

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	12.6	 	None of the rights, powers and remedies granted to the Parties by any
provisions herein shall preclude any other rights, powers and
remedies available to such Parties at law and under the other
provisions of this Agreement, nor shall the exercise by a party of
its rights, powers and remedies preclude any exercise by such party
of its other rights, powers and remedies.

	12.7	 	No failure or delay by a Party in exercising any of its rights,
powers and remedies hereunder or in accordance with laws (hereinafter
the “Party’s Rights”) shall result in a waiver thereof, nor shall the
waiver of any single or partial exercise of the Party’s Rights shall
preclude such Party from exercising such rights in any other way and
exercising the other Party’s Rights.

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

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

	12.10	 	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 12.1 of this Agreement, the
amendments or supplements to this Agreement shall become effective
only when duly signed by the Parties to this Agreement. The Parties
shall obtain permission from and/or complete registration or filing
formalities with any government authority according to law if any
amendment or supplement to this Agreement so requires.

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

	12.12	 	At the time of execution hereof, the Pledgors shall sign a power of
attorney (hereinafter the “Power of Attorney”), the format of which
is shown in Appendix II, to authorize any person designated by the
Pledgee to sign on its behalf according to this Agreement any and
all legal documents necessary for the exercise by the Pledgee of its
rights hereunder. Such Power of Attorney shall be delivered to the
Pledgee for 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]

 

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IN WITNESS HEREOF, the Parties have caused this Equity Pledge Agreement to be executed as of the
date and in the place first above written.

	 	 	 	 	 
	Han Junping	 	 
	 
	 	 	 	 
	Signature:

	 	/s/ Han Junping
 

	 	 
	 
	 	 	 	 
	Xiong Wei	 	 
	 
	 	 	 	 
	Signature:

	 	/s/ Xiong Wei
 

	 	 

The9
Computer Technology Consulting (Shanghai) Co., Ltd. [Chop
affixed]

(Company chop)

[Chop of Shanghai Huopu Cloud Computing Terminal Technology Co., Ltd. affixed]

 

 

Appendix I

Basic
Information of Huopu Cloud

	 	 	 
	Company Name

	 	Shanghai Huopu Cloud Computing Terminal Technology Co., Ltd.
	Registered Address

	 	Room 1F02, Block 14, No. 528, Yanggao North Road, New
Pudong District, Shanghai
	Registered Capital

	 	RMB50 million
	Legal Representative

	 	Junping Han

	 	 	 	 	 	 	 	 
	Capital Structure	 	Shareholder’s name	 	Contribution (RMB)	 	Capital Share
	 

	 	Junping Han
	 	30 million
	 	60	%
	 

	 	Wei Xiong
	 	20 million
	 	40	%
	 

	 	Total
	 	50 million
	 	100	%
	 
	 	 	 	 	 	 
	Financial Year	 	January 1 to December 31	 	 

 

 

 

Appendix II

Form of the Power of Attorney

I,                     , hereby irrevocably appoint
 _____, ID no.
 _____, as my
attorney-in-fact to sign all the requisite or ancillary legal documents required for The9 Computer
Technology Consulting (Shanghai) Co., Ltd. (“The9 Computer”) to exercise its rights under the
“Equity Pledge Agreement in relation to Shanghai Huopu Cloud Computing Terminal Technology Co.,
Ltd.” entered into between The9 Computer and myself.

Signature:                     

Date:exv4w35

Exhibit 4.35

Translation

December 13, 2010

Loan Agreement

by and among

Han Junping

Xiong Wei

and

The9 Computer Technology Consulting (Shanghai) Co., Ltd.

 

 

 

Loan Agreement

This Loan Agreement (hereinafter this “Agreement”) is entered into in Shanghai, the People’s
Republic of China (hereinafter “PRC”) as of December 13, 2010 by and among the following Parties:

	1.	 	The9 Computer Technology Consulting (Shanghai) Co., Ltd. (hereinafter
“The9 Computer”)

Registered address: Room 103, No. 690 Bibo Road, Zhangjiang Hi-Tech Park, Shanghai

	2.	 	Han Junping, a PRC citizen with his identity card number:                     

Domicile address:                     

	3.	 	Xiong Wei, a PRC citizen with his identity card number:                     

Domicile address:                     

(Han Junping and Xiong Wei are hereinafter referred to collectively as the “Borrowers” and
individually as the “Borrower”).

WHEREAS:

The Borrowers intend to request a loan from The9 Computer for its investment in
and establishment of Shanghai Huopu Cloud Computing Terminal Technology Co.,
Ltd. (hereinafter the “Company”), and The9 Computer also agrees to offer a loan
of Fifty Million Renminbi (RMB50,000,000) in aggregate (hereinafter the “Loan”)
to the Borrowers in accordance with the terms and conditions of this Agreement.
The parties, through amicable consultation and for the purpose of confirming
matters with regard to the Loan between them, hereby have reached the following
agreement:

Article 1 Sum and Interest Rate of Loan

	1.1	 	The sum of the Loan under this Agreement shall amount to Fifty Million
Renminbi (RMB50,000,000), which is the Loan of Fifty Million Renminbi
(RMB50,000,000) provided by The9 Computer to Borrowers, of which:

Thirty Million Renminbi (RMB 30,000,000) will be provided by The9
Computer to Han Junping

Twenty Million Renminbi (RMB 20,000,000) will be provided by The9
Computer to Xiong Wei

	1.2	 	The interest rate of the Loan under this Agreement shall be zero,
which means that no interest will be charged.

 

 

 

	1.3	 	Each of the Borrowers shall sign an equity pledge agreement with The9 Computer as per its
request to pledge all of his equity interest in the Company to The9 Computer as an guarantee
for the Loan.

Article 2 Use and Withdrawal of Loan

	2.1	 	The Borrowers shall apply the Loan hereunder only for the investment
in or the operation of the Company. The Borrowers shall not use any
part of the Loan for any other purpose unless with the prior written
consent of The9 Computer.

	2.2	 	The Borrower shall, within five (5) business days of the date hereof, make an request to
The9 Computer for the withdrawal of all the Loan hereunder in a lump sum. Subject to
compliance with the provisions of this Agreement, the Loan shall be paid by The9 Computer to
the bank accounts designated by the Borrowers as per their request.

Article 3 Term of Loan

	3.1	 	The term of the Loan under this Agreement shall expire on the date
when The9 Computer requests the Borrowers to repay the Loan in
accordance with Article 3.2 of this Agreement. However, the maximum
term shall not exceed the business term of The9 Computer (including
the business term as extended from time to time) or the business term
of the Company (including the business term as extended from time to
time), whichever is earlier (hereinafter “Term”). Upon expiry of the
Term, the Borrowers shall repay all outstanding amounts under the Loan
(hereinafter “Amounts”) in a lump sum on the expiry date of the Term.
	 
	 	 	Upon execution hereof, The9 Computer shall, at any time within the Term and in
its absolute discretion, be entitled to deliver to the Borrowers a repayment
notice under Article 4.1 of this Agreement, requesting the Borrowers to repay
all or part of their respective Amounts under this Agreement.

	3.2	 	Any Borrower required to make repayment shall repay the relevant
Amounts in cash, or in any other forms as decided by the board of
directors of The9 Computer by way of resolution duly passed by it. If
the repayment is made in cash, the Borrowers shall credit the entire
Amounts required by The9 Computer for repayment to the bank account
designated by The9 Computer within five (5) business days upon the
receipt of a repayment notice under Article 4.1 of this Agreement.

	3.3	 	If The9 Computer gives the repayment notice under Article 4.1 of this
Agreement to the Borrowers, it shall, without violating any applicable
laws and regulations, have the right to acquire on its own or
designate any third party to acquire all of the equity interests owned
by the Borrowers in the Company at the time when such notice is given
at the transfer price that is equivalent to the Amounts.

 

 

 

	3.4	 	The9 Computer shall, in its absolute discretion, also have the right
to demand to offset its creditor’s right to the Borrowers under this
Agreement against all or part of the transfer price required to be
paid by it to the Borrowers in connection with its exercise of the
relevant call option (hereinafter “Call Option”) when it exercises the
Call Option in accordance with the provisions of the Exclusive Call
Option Agreement entered into between The9 Computer and the Borrowers
on December 13, 2010 (hereinafter “Option Agreement”).

	3.5	 	The Borrower shall not be jointly and severally liable for the
repayment by the other Borrower of his Loan under this Agreement.

Article 4 Repayment Notice

	4.1	 	The repayment notice given by The9 Computer to the Borrower or any or
several of the Borrowers shall at least contain the following items:
name of Borrower, sum of Loan, sum of repayment, time of repayment and
bank account for repayment.

Article 5 Representations and Warranties

	5.1	 	The Borrower hereby represents and warrants as follows:

	 	5.1.1	 	he is a PRC citizen with full capacity, has full and independent
legal status and legal capacity to execute, deliver and perform this
Agreement, and may act independently as a party to lawsuit.

	 	5.1.2	 	he has full power to execute and deliver this Agreement and all the
other documents to be signed by him in relation to the transaction
referred to herein, and he has full power to complete the
transaction referred to herein. This Agreement shall be executed and
delivered by him legally and properly. This Agreement constitutes
the legal and binding obligations on him and is enforceable against
him in accordance with its terms and conditions.

	 	5.1.3	 	he has fully disclosed his financial conditions to The9 Computer
before the execution of this Agreement. As of the execution of this
Agreement, there exist no circumstances that may render him in
insolvency, nor are there any material liabilities that affects his
ability to repay debts. The9 Computer may demand him to perform his
obligations hereunder in accordance with this Agreement.

	5.2	 	The9 Computer hereby represents and warrants as follows:

	 	5.2.1	 	it is a limited liability company duly incorporated and legally
existing under the laws of the PRC with an independent legal person
status. It has full and independent legal status and legal capacity
to execute, deliver and perform this Agreement and may act
independently as a party to lawsuit.

	 	5.2.2	 	it has the full corporate power and authority to execute and deliver
this Agreement and all the other documents to be signed by it in
relation to the transaction referred to herein, and it has the full
power and authority to complete the transaction referred to herein.

 

 

 

Article 6 Term of Agreement

	6.1	 	This Agreement shall become effective once it is duly signed by the
parties. This Agreement confirms all matters with regard to the Loan
between the parties and shall terminate when the Borrowers repay in
full the Loan under this Agreement.

	6.2	 	If any of the Borrowers transfers his liabilities under this Agreement
with the prior consent of The9 Computer, then the successor of such
liabilities shall continue to perform such Borrower’s obligations
under this Agreement, and the obligations and undertakings of the
other Borrower under this Agreement shall not be adversely affected as
a result thereof.

Article 7 Taxes

	7.1	 	All taxes in connection with the Loan shall be borne by The9 Computer.

Article 8 Confidentiality

	8.1	 	Regardless of whether this Agreement has terminated or not, the Borrowers
shall be under an obligation to keep in confidence any trade secret,
proprietary information and customer information (hereinafter “Confidential
Information”) in connection with The9 Computer that are known to or received
by them due to the execution and performance of this Agreement. The
Borrowers shall use the Confidential Information only for the purpose of
performing their obligations under this Agreement. Without the written
permission of The9 Computer, the Borrowers shall not disclose the above
Confidential Information to any third party. Otherwise, they shall be liable
for the breach of this Agreement and make compensation for all losses arising
therefrom.

	8.2	 	The following information shall not be deemed as the Confidential Information:

	 	(a)	 	any information that has been legally known by the receiving party before
as evidenced by written documents;
	 
	 	(b)	 	any information entering the public domain not attributable to the fault
of the receiving party; or
	 
	 	(c)	 	any information lawfully acquired by the receiving party through other
sources after his/its receipt of such information.

	8.3	 	Following the termination of this Agreement, the Borrowers shall, upon
request by The9 Computer, return, destroy or otherwise dispose of all files,
materials or software containing the Confidential Information, and shall
cease to use such Confidential Information.
	 
	8.4	 	Notwithstanding any other provisions herein, the effect of this Article 8
shall not be affected by the suspension or termination of this Agreement.

 

 

 

Article 9 Undertakings and Warranties

	9.1	 	The Borrowers hereby irrevocably guarantee and warrant that they will
not in any way make nor authorize others (including but not limited to
the Company’s directors nominated by them) to make any resolution,
instruction, consent or order to procure the Company to carry out any
transaction that would or might substantially affect any asset, right,
obligation or business of the Company and/or its subsidiaries
(hereinafter “Prohibited Transaction”), including but not limited to:

	 	(1)	 	borrowing money from any third party or assuming any debts (except
for any single debt whose amount does not exceed One Hundred
Thousand Renminbi incurred in the usual and normal business
activities or any debt whose total amount does not exceed One Hundred
Thousand Renminbi in consecutive six months);
	 
	 	(2)	 	providing guarantees to any third party for its own debts, or
providing any guarantee to any third party;
	 
	 	(3)	 	transferring any businesses, major assets, actual or potential
business opportunities to any third party;
	 
	 	(4)	 	transferring any domain names, trademarks or other intellectual
property in which the Company has legal right to any third party;
	 
	 	(5)	 	transferring all or part of their equity interests in the Company
to any third party;
	 
	 	(6)	 	any other major transactions;

nor sign any agreement, contract, memorandum or transaction document
of any other form in respect of the Prohibited Transaction(hereinafter
“Prohibited Document”), nor will they allow any Prohibited Transaction
to be carried out nor any Prohibited Document to be signed through
omission to act.

	9.2	 	The Borrowers shall procure the directors and senior management of the
Company to strictly observe the provisions of this Agreement in
discharging their duties as directors and senior management of the
Company.

Article 10 Notices

	10.1	 	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.

	10.2	 	Any such notice or other correspondences shall be deemed to have been
delivered, if sent by facsimile or telex, when it is sent, and if
delivered in person, when it is delivered, and if sent by post, five
(5) days after it was posted.

 

 

 

Article 11 Liabilities for Breach of Contract

	11.1	 	The parties agree and confirm that, if any of the parties
(hereinafter the “Defaulting Party”) substantially violates any of
the provisions herein or substantially fails to perform any of the
obligations hereunder, such violation or failure shall constitute a
default under this Agreement (hereinafter a “Default”), and any of
the other non-defaulting parties (hereinafter a “Non-defaulting
Party”) shall have the right to require the Defaulting Party to
rectify such Default or take remedial measures within a reasonable
period. If the Defaulting Party fails to rectify such Default or
take remedial measures within such a reasonable period or within ten
(10) days after the other party notifies the Defaulting Party in
writing and requires it to rectify the Default, then the
Non-defaulting Party shall have the right to terminate this Agreement
and/or to demand the Defaulting Party to make compensation for any
loss.

	11.2	 	The rights and remedies set out herein shall be cumulative, and shall
not preclude any other rights or remedies provided by law.

	11.3	 	Notwithstanding any other provisions herein, the effect of this
Article shall not be affected by the suspension or termination of
this Agreement.

Article 12 Miscellaneous

	12.1	 	This Agreement is executed in Chinese in three (3) originals, with
one (1) original to be retained by each party hereto.

	12.2	 	The formation, effectiveness, performance, amendment, interpretation
and termination of this Agreement shall be governed by the laws of
the PRC.

	12.3	 	Any disputes arising out of and in connection with this Agreement
shall be resolved through consultations among the parties. If the
parties cannot reach an agreement regarding such disputes within
thirty (30) days upon their occurrence, such disputes shall be
submitted to China International Economic and Trade Arbitration
Commission, Shanghai Branch, for arbitration in Shanghai in
accordance with the arbitration rules of such Commission, and the
arbitration award shall be final and binding on the parties.

	12.4	 	None of the rights, powers and remedies granted to the parties by any
provisions herein shall preclude any other rights, powers and
remedies available to such parties at law and under the other
provisions of this Agreement, nor shall the exercise by a party of
its rights, powers and remedies preclude any exercise by such party
of its other rights, powers and remedies.

	12.5	 	No failure or delay by a party in exercising any of its rights,
powers and remedies hereunder or in accordance with laws (hereinafter
the “Party’s Rights”) shall result in a waiver thereof, nor shall the
waiver of any single or partial exercise of the Party’s Rights
preclude such party from exercising such rights in any other way and
exercising the other Party’s Rights.

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

 

 

 

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

	12.8	 	Any amendments or supplements to this Agreement shall be made in
writing and shall become effective only when duly signed by the
parties to this Agreement.

	12.9	 	Without the prior written consent of the lender, the Borrowers shall
not transfer any of their respective rights and/or obligations
hereunder to any third parties. The lender shall be entitled to
transfer any of its rights hereunder to any third party designated by
it after serving notice to the other parties.

	12.10	 	This Agreement shall be binding on the legal successors of the parties.

 

 

 

IN WITNESS HEREOF, the parties hereto have caused this Agreement to be executed as of the date and
in the place first above written.

The9 Computer Technology Consulting (Shanghai) Co., Ltd. [Chop affixed]

(Company chop)

	 	 	 	 	 
	Han Junping	 	 
	 
	 	 	 	 
	Signature:

	 	/s/ Han Junping
 

	 	 
	 
	 	 	 	 
	Xiong Wei	 	 
	 
	 	 	 	 
	Signature:

	 	/s/ Xiong Wei

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