Document:

qtt-ex431_160.htm

 

Exhibit 4.31

 

LOAN AGREEMENT

 

THIS Loan Agreement (this “Agreement”) is executed on September 29, 2019 in Shanghai, the People's Republic of China (“PRC”) by and among the following parties: 

 

	
1.
	
Wanting Xu, Chinese, ID No.: [REDACTED];

 

	
2.
	
Min Gao, Chinese, ID No.: [REDACTED] (together with Wanting Xu hereinafter referred to as “Borrower”); and

 

	
3.
	
Shanghai Quyun Internet Technology Co., Ltd., a limited liability company established and validly existing under PRC law with its registered address at [REDACTED] (“Lender”). 

 

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

 

Whereas:

 

	
1.
	
The Lender is a wholly foreign-owned enterprise registered and established under the PRC law;

 

	
4.
	
As of the date of this Agreement, the Borrowers collectively own 100% of the equity interests in the Anhui Zhangduan Internet Technology Co., Ltd. (the “Domestic Company”), and their respective capital contribution amount and shareholding ratios are shown in Schedule I attached hereto;

 

	
2.
	
The Lender intends to provide the Borrowers with a loan for the purposes as specified in this Agreement.

 

Therefore, the Parties reached the agreements through negotiation as follows:

 

	
Article 1
	
Definitions

 

	
1.1
	
In this Agreement:

 

“Loan” means any and all loans provided by the Lender to the Borrower under this Agreement;

 

	
 
	

	
“Due date” shall have the meaning under Article 4.1 of this Agreement;

 

“Notice of Repayment” shall have the meaning under Article 4.2 of this Agreement;

 

“Repayment Application” shall have the meaning under Article 4.3 of this Agreement.

 

	
1.2
	
Relevant capitalized terms used and mentioned herein shall have the meanings 

		
given to them as below:

 

 “Articles” shall be interpreted as articles in this Agreement unless the context of this Agreement stipulates otherwise;

 

“Taxes and Fees” shall be interpreted as a charge of any tax, fee, tariff, or other charges of equivalent nature (including, but not limited to, any fine or interest relating to the taxes and fees that are not paid or delayed).

 

The “Borrower” or “Borrowers” and the “Lender” shall be interpreted as including successors and assignees of all Parties.

 

	
1.3
	
Unless otherwise specified, any reference made herein to this Agreement or any other agreement or document shall, depending on the situation, be interpreted as references made to the amendments, changes, substitutions or supplements that have been made or could be made from time to time to this Agreement or to such other agreements or documents.

 

	
Article 2
	
Loan

 

	
2.1
	
Based on the terms and conditions of this Agreement, the Lender agrees to provide loans to the Borrowers in accordance with the terms and conditions stipulated herein. The actual amount of the Loan shall be separately determined by the Borrowers and the Lender in written. The Borrowers agree to accept the aforesaid Loan provided by the Lender in accordance with the conditions and terms stipulated in this Agreement and to provide funds to the Domestic Company to develop its business. Without the consent of the Lender, the Borrower shall not use the Loan for any purpose other than those stipulated herein.

 

	
2.2
	
The Parties confirm that the Borrowers shall perform repayment obligations and other obligations under this Agreement to the Lender in accordance with the provisions of this Agreement.

 

	
2.3
	
According to the requirements of the Lender, the Borrowers has executed an Equity Pledge Agreement with the Lender, the Domestic Company and other shareholders of the Domestic Company on the date the same as the execution date hereof, pursuant to which the Borrowers have pledged all the shares of the Domestic Company owned by them to the Lender as a guarantee for the Loan.

 

	
Article 3
	
Interest

 

Unless otherwise agreed herein, the Lender acknowledges and confirms that the Loan under this Agreement shall be free of any interest whatsoever.

 

	
Article 4
	
Repayment

 

	
4.1
	
Unless the Parties unanimously agree to extend the Loan, any loan under this Agreement shall be fully repaid by the Borrowers at one time on one of the following dates whichever occurs earlier (“Due Date”): (i) upon the expiration of ten (10) years after the execution of this Agreement, or (ii) upon the 

 

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expiration of the operation term of the Lender, or (iii) upon the expiration of the operation term of the Domestic Company. Under such circumstance, to the extent that there is no violation of applicable laws and regulations, the Lender shall have the right to purchase or appoint a third party to purchase all the shares of the Domestic Company held by the Borrowers at that time at the lowest price permitted by the laws and regulations. The Parties agree to sign a separate agreement with other relevant parties with regard to the above matters.

 

	
4.2
	
From the execution date of this Agreement to the Due Date, the Lender may, at any time, decide to accelerate the maturity of the Loan on its absolute sole discretion by issuing a notice of repayment (“Repayment Notice”) to the Borrowers thirty (30) days in advance, requiring the Borrowers to repay part or all of the Loan amount. Under the circumstance that the Lender requests the Borrowers to repay according to the aforesaid provisions, the Parties agree and confirm that the Borrowers shall repay the Loan provided by the Lender to the Borrowers hereunder only by way of the following: to the extent permitted under PRC laws and regulations, the Borrowers shall, according to the requirements specified in the written notice of the Lender, transfer the equity interests of the Domestic Company to the Lender or its designated person, and repay the Loan hereunder to the Lender with the proceeds gained from their equity transfer. The Lender shall provide unconditional financial support to the Domestic Company based on this Agreement or any other agreement. Regardless of any provision otherwise agreed under this Agreement, the Lender irrevocably agrees that, if Borrowers are not able to (i.e. not permitted by law) repay the Loan in accordance with the provisions of this Agreement, it shall waive the right of requesting the repayment of the Borrowers.

 

	
4.3
	
When the Loan is due and the Borrowers are required to transfer the equity interests to the Lender or the person designated by the Lender, if, due to legal requirements or other reasons, the actual transfer price of the equity interests (the “Equity”) of the Domestic Company received by the Borrowers is higher than the principal of the Loan, the difference between the proceeds obtained from the Borrowers’ assignment of the Equity and the principal of the Loan shall be deemed as the interest of the Loan or as the cost for the occupation of funds, and shall be repaid to the Lender along with the principal of the Loan.

 

	
4.4
	
The Borrowers shall repay the aforementioned corresponding amount in cash or repay it in other forms determined by the resolution made by the Lender’s board of directors appropriately.

 

	
4.5
	
When the Borrowers repay the aforementioned corresponding amount in accordance with this Article 4, all Parties shall complete the agreed equity transfer matters at the same time, and ensure that the payment has been fully made. Meanwhile, the Lender or the third party designated by the Lender shall have legally and completely accepted the Equity of the Domestic Company according to the above-mentioned agreement, and there is no pledge or any other encumbrance on such equity interest. The Borrowers shall provide all reasonable assistance according to the foregoing agreement for the equity transfer of the Domestic Company, and cause other shareholders of the Domestic Company to waive their  rights of first refusal.

 

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4.6
	
Only when the Borrowers transfer all the equity interests in the Domestic Company they hold to the Lender or the third party designated by the Lender in accordance with this Article 4, and after the Loan is fully repaid (including the principal of the Loan and the maximum interest or cost of funds of the Loan as allowed by the applicable law at that time), it shall be deemed as a complete performance of the Borrower's repayment obligations under this Agreement.

 

	
Article 5
	
Taxes and Fees

 

All taxes and fees related to the Loan shall be borne by the Lender.

 

	
Article 6
	
Confidentiality

 

	
6.1
	
Whether or not this Agreement has been terminated, the Borrowers shall maintain confidentiality of all the information relating to the Lender’s trade secret, proprietary information, client information (“Confidential Information”) known to or obtained by the Borrowers during the course of execution and performance of this Agreement. The Borrowers shall only use such Confidential Information for purpose of their performance of their obligations hereunder. Without the Lender’s written consent, any of the Borrowers shall not disclose any Confidential Information to any third party, otherwise such Borrower shall bear the default liabilities and compensate the losses incurred to the Lender.

 

	
6.2
	
The following information is not deemed as Confidential Information:

	
 
	
(a)
	
Any information is known and obtained by the recipient previously through legitimate form which could be evidenced by proof;

	
 
	
(b)
	
Information of the public which is not due to the recipient’s fault; or 

	
 
	
(c)
	
Information obtained through other legitimate form by the recipient after the recipient received the information.

 

	
6.3
	
Subsequent to the termination of this Agreement, the Borrowers shall return, destroy all the documents, materials or software containing the Confidential Information or dispose in other corresponding ways upon request from the Lender, and refrain from using such Confidential Information.

 

	
6.4
	
Notwithstanding any other provision hereunder, the effect of this Article 6 shall not be influenced by suspension or termination of this Agreement.

 

	
Article 7
	
Representations and Warranties

 

	
7.1
	
The Borrowers hereby irrevocably covenant and warrant that, without the prior written consent from the Lender, the Borrowers shall not make or authorize other person (including but not limited to the director of the Domestic Company nominated by the Lender) to make any resolution, instruction, consent or order in any way, to prompt the Domestic Company to make any transaction which 

 

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will or may substantially affect the assets, rights, obligations or business (“Prohibited Transactions”) of the Domestic Company (including their branches and/or subsidiaries), including but not limited to:

 

	
 
	
(1)
	
borrow money from a third party or undertake any debt (except for the debts or guarantees arising from normal daily business activities and beyond the annual budget which amount does not exceed RMB 10,000,000 each);

 

	
 
	
(2)
	
provide guarantees to third parties for its own debt or provide any guarantee to a third party;

 

	
 
	
(3)
	
transfer any business, major assets, actual or potential business opportunities to a third party;

 

	
 
	
(4)
	
transfer or license any domain name, trademark, or other intellectual property (if any) that are legally owned by the Domestic Company to a third party;

 

	
 
	
(5)
	
transfer part or all of its equity interests in the Domestic Company to a third party;

 

	
 
	
(6)
	
any other major transaction;

 

or shall not execute any agreement, contract, memorandum or other form of transaction documents (“Prohibited Document”) concerning the Prohibited Transaction, and shall not indulge the process of any Prohibited Transaction or the execution of any Prohibited Document by any omission.

 

	
7.2
	
It will cause the directors and managers of the Domestic Company to strictly abide by this Agreement when performing their duties as the directors or managers, and do not conduct any action or omission which is contrary to any covenant aforementioned in any way.

 

	
Article 8
	
Notice

 

	
8.1
	
All notices and other communications required or sent under this Agreement shall be delivered personally, through registered mail, postage paid or business express service or fax to the Party’s following address. Each notice shall also be delivered by email at the same time. The dates on which the notices deemed to have been effectively delivered shall be determined as follows:

 

	
 
	
8.1.1
	
For notices delivered by personal delivery, express service or registered mail, postage paid, the effective delivery date shall be deemed as the date of delivery or refusal of receipt at the address specified for notices.

 

	
 
	
8.1.2
	
For notices delivered by fax, the effective delivery date shall be the date of successful transmit (as evidenced by an automatically generated confirmation of transmission)

	
8.2
	
For the purpose of notice, the addresses of the Parties are as follows:

 

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The Borrowers:

Wanting Xu

Address: [REDACTED]

Recipient: [REDACTED]

Mobile:    [REDACTED]

 

Min Gao

Address: [REDACTED]

Recipient: [REDACTED]

Mobile:    [REDACTED]

 

The Lender: Shanghai Quyun Internet Technology Co., Ltd.

Address: [REDACTED]

Recipient: [REDACTED]

Mobile:    [REDACTED]

 

	
8.3
	
Any Party may at any time change its address for notices by a notice delivered to the other Parties in accordance with the terms hereof.

 

	
Article 9
	
Default Liability

 

	
9.1
	
The Borrowers covenant that it will undertake the corresponding liability to compensate to the Lender for any action, charge, claim, cost, damage, request, fee, liability, loss and procedure suffered or caused by the Borrower’s violation of any obligation under this Agreement.

 

	
9.2
	
Notwithstanding any other provision of this Agreement, the effectiveness of this Article will not be influenced by suspension or termination of this Agreement.

 

 

	
Article 10
	
Miscellaneous

 

	
10.1
	
This Agreement is written in Chinese and executed in three (3) copies. Each party of this Agreement shall have one (1) and all the copies shall have equal legal effect.

 

	
10.2
	
The conclusion, effectiveness, implementation, modification, interpretation and termination of this Agreement shall all be governed by PRC laws.

 

	
10.3
	
Any dispute arising under this Agreement or related to this Agreement shall be resolved through negotiation among the disputing Parties. If the disputing Parties cannot reach an agreement within thirty (30) days after the dispute arose, the dispute shall be submitted to China International Economic and Trade Arbitration Commission. The arbitration shall be conducted in Shanghai according to the valid arbitration rules when submitting. The award of the arbitral tribunal shall be final and binding on all disputing Parties.

 

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10.4
	
Any right, power, and remedy given to the Parties by any provision in this Agreement shall not exclude any other right, power or remedy the Party enjoys in accordance with the laws and other provisions under this Agreement. In addition, the exercise by one Party of its rights, powers and remedies shall not exclude such Party’s exercise of other rights, powers and remedies it enjoys.

 

	
10.5
	
Any Party’s failure or delay to exercise any right, power and remedy enjoyed by this Agreement or laws (“Such Party’s Rights”) will not cause waiver of such rights. In addition, waiver of any single or part of Such Party’s Right will not exclude such Party’s exercising of such rights in other ways and exercising other rights.

 

	
10.6
	
The title of Articles in this Agreement is only set for reference only, and such titles shall not be used to or affect the interpretation of Articles in this Agreement under any circumstance.

 

	
10.7
	
Each Article of this Agreement can be severable and independent from any other Article. If at any time any one or several Articles of this Agreement are found to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining Articles of this Agreement shall not be affected thereby.

 

	
10.8
	
This Agreement and the schedules hereof shall replace all verbal or written agreements, understandings and communications which covenanted previously by all Parties in respect of the standard contents of this Agreement and its schedules. Any amendment and supplement to this Agreement shall be made in writing and shall take effect after properly executed by the Parties hereto.

 

	
10.9
	
Without the prior written consent from the Lender, any Borrower shall not transfer any of its rights and/or obligations under this Agreement to any third party; The Lender shall have the right to transfer any of its rights under this Agreement to any third party it designated without prior notice to any Borrower or consent from any Borrower.

 

	
10.10
	
This Agreement shall be binding on legitimate assignees or successors of the Parties.

 

 

[The remainder of this page intentionally left in blank.]

 

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 [Signature Page]

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the date first above written.

 

Wanting Xu

Signature: /s/ Wanting Xu     

 

 

Min Gao

Signature: /s/ Min Gao        

 

 

Shanghai Quyun Internet Technology Co., Ltd.

 (Seal)

 

Signature: /s/ Fei Shen                           

Name: Fei Shen

Title: Legal Representative

 

 

 

 

The Signature Page of Loan Agreement

 

 

SCHEDULE I

 

Company Name: Anhui Zhangduan Internet Technology Co., Ltd.

Shareholding Structure:

 

			
	
Shareholder Name
	
Amount of Contribution of Company’s registered capitals

(RMB/Yuan)
	
Shareholding Ratio

	
Wanting Xu
	
6,000,000
	
60%

	
Min Gao 
	
4,000,000
	
40%

	
Total
	
10,000,000
	
100%qtt-ex432_214.htm

 

 

Exhibit 4.32

 

Share Pledge Agreement

 

THIS Share Pledge Agreement (this “Agreement”) is executed on January 1, 2019 by and among the following parties in Shanghai, the People’s Republic of China (the “PRC” or “China”):

 

	
1.
	
Biao Liu, Chinese, ID No.: [REDACTED];

 

	
2.
	
Zhongyuan Zhang, Chinese, ID No.: [REDACTED] (together with Biao Liu hereinafter referred to respectively or collectively as “Pledgor” or “Pledgors” ); and 

 

	
3.
	
Shanghai Quyun Internet Technology Co., Ltd., a limited liability company established and validly existing under PRC law with its registered address at [REDACTED] (the “Pledgee”); and

 

	
4.
	
Shanghai DragonS Information Technology Co., Ltd., a limited liability company established and validly existing under PRC law with its registered address at [REDACTED] (“Company”).

 

In this Agreement, the above parties hereto may be individually referred to as a “Party” and collectively referred to as the “Parties”.

 

Whereas:

 

	
1.
	
The Pledgors are registered shareholders of the Company, collectively hold 100% of the Company’s equity interests. As of the date of this Agreement, the respective amount of capital contribution and proportion of shareholding of the Pledgors in the Company are as stated in Schedule I.

 

	
2.
	
Pursuant to the Exclusive Option Agreement (including the Agreement itself and any of its amendments or restatements, hereinafter referred to as the “Option Agreement”) executed by and among the Parties on the date of this Agreement, the Pledgors and/or the Company shall, as per requested by the Pledgee and to the extent permitted under the PRC law, transfer all or part of the equity interest held by the Pledgors and/or all or part of the assets in the Company to the Pledgee and/or any other entity or individual designated by the Pledgee.

 

	
3.
	
Pursuant to the Loan Agreement (including the Agreement itself and any of its amendments or restatements, hereinafter referred to as the “Loan Agreement”) executed by the Pledgors and the Pledgee on the date of this Agreement, the Pledgee agrees to provide loans to the Pledgors in accordance with the terms and conditions stipulated in the Loan Agreement.

 

	
4.
	
Pursuant to the Voting Rights Proxy Agreement (including the Agreement itself and any of its amendments or restatements, hereinafter referred to as the “Voting Rights Proxy Agreement”) executed by the Parties on the date of this Agreement, the Pledgors have irrevocably and fully authorized the person appointed by the Pledgee at that time to represent the Pledgors to exercise all their voting rights as shareholders in the Company.

 

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5.
	
Pursuant to the Exclusive Technical and Consulting Services Agreement (including the Agreement itself and any of its amendments or restatements, hereinafter referred to as the “Consulting Services Agreement”) executed by the Company and the Pledgee on the date of this Agreement, the Company has exclusively engaged the Pledgee to provide the Company relevant technical support and consultation services, and has agreed to pay corresponding service fees to the Pledgee for such provision of services.

 

	
6.
	
To secure the performance of the Pledgors and the Company of the Contractual Obligations (as defined below) and the repayment of the Secured Indebtedness (as defined below), the Pledgors agree to pledge all of their equity interests in the Company in favor of the Pledgee, and grant the Pledgee the first priority right of pledge.

 

By friendly negotiation, the Parties agree as follows:

 

	
1.
	
Definitions

 

Unless otherwise provided herein, the following words and terms shall have the respective meanings set forth below:

 

	
 
	
1.1
	
“Contractual Obligations” means all Contractual Obligations of the Pledgors and/or the Company under the Loan Agreement, the Consulting Service Agreement, the Option Agreement, the Voting Rights Proxy Agreement and this Agreement (and any of its amendments or restatements thereof).

 

	
 
	
1.2
	
“Pledge” means the security interest granted by the Pledgors to the Pledgee in accordance with Article 2 of this Agreement, which refers to the right to be compensated on a preferential basis with the conversion, auction or sales price of the equity interest enjoyed by the Pledgee.

 

	
 
	
1.3
	
“Transaction Agreements” means the Loan Agreement, the Option Agreement, the Voting Rights Proxy Agreement and the Consulting Service Agreement.

 

	
 
	
1.4
	
“Secured Indebtedness” includes all service fees as well as the interests incurred accordingly that shall be payable to the Pledgee and the repayment of the loan along with the interests incurred that shall be made by the Pledgors to the Pledgee under the Transaction Agreements; the amount of all direct, indirect and predictable loss of benefits raising out of any Event of Default (as defined below) caused by the Pledgors and/or the Company as determined by the Pledgee on its sole discretion (to the extent permitted by PRC law) which shall be fully binding on the Pledgors and the Company; all expenses of the Pledgee incurred from forcing the the Pledgors and/or the Company to perform the Contract Obligations, and fees and expenses for the enforcement of the Pledge (including but not limited to the legal fees, arbitration fees, costs of assessment and auction of the Pledged Interests and etc.).

 

	
 
	
1.5
	
“Pledged Interests” means all of the Company’s equity interests legally owned by the Pledgors as of the date of effectiveness of this Agreement which shall, pursuant to this Agreement, be pledged to the Pledgee as collateral security for the performance of the Contractual Obligations (as specifically stated in Schedule I).

 

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1.6
	
“Term of the Pledge” refers to the term set forth in Article 3 of this Agreement.

 

	
 
	
1.7
	
“Event of Default” refers to any of the circumstances listed in Article 7 of this Agreement. 

 

	
 
	
1.8
	
“Notice of Default” refers to the notice issued by the Pledgee in accordance with this Agreement declaring an Event of Default.

 

	
2.
	
Pledge of Equity Interests

 

Pursuant to this Agreement, the Pledgors hereby agree to pledge, all of the equity interest which are legally held and are entitled to be disposed by the Pledgors (collectively representing 100% equity interest in the Company) to the Pledgee, as a jointly liability guarantee to secure the performance of the Contractual Obligations and the repayment of the Secured Indebtedness of the Pledgors and the Company. 

 

	
3.
	
Term of the Pledge

 

	
 
	
3.1
	
This Pledge shall become effective on such date when the pledge of the equity interest contemplated herein is registered with competent authority of Administration for Industry and Commerce (“AIC”). The Pledge shall continue until all Contractual Obligations have been fully performed by the Pledgors and the Company and all Secured Indebtedness have been paid in full, or all of the Transaction Agreements have been terminated or turned invalid, or the Contractual Obligations have been terminated for legal reasons.

 

	
 
	
3.2
	
The Pledgors and the Company shall (1) record the Pledge made under this Agreement on the Company’s register of shareholders when appropriate after the execution of this Agreement, and (2) file the Pledge with the appropriate AIC to complete the pledge registration of the Pledged Interests under this Agreement after the execution of this Agreement when appropriate. Such registration of Pledged Interests shall be completed within 20 working days after the date of this Agreement or other time period agreed by the Parties, and the certification documents concerning the registration with AIC shall be delivered to and kept by the Pledgee. The Parties jointly confirm that, in order to complete the procedure of pledge registration with AIC, the Parties and other shareholders of the Company shall submit this Agreement, or, a Pledge Contract executed in the way complying with the requirements of the AIC of the registered place of the Company in which truly reflects the information of the Pledge under this Agreement (“Pledge Agreement for AIC Registration”) to AIC. Matters that are not specified in the Pledge Agreement for AIC Registration shall be subject to the provisions of this Agreement. The Pledgors and the Company shall, as per required by relevant AIC and pursuant to the PRC laws and regulations, submit all necessary documents and complete all necessary procedures to ensure that the Pledge will be registered as soon as possible after filing the application.

 

	
 
	
3.3
	
In case of any Event of Default, the Pledgee shall be entitled to dispose the Pledged Interests in accordance with Article 8 of this Agreement.

 

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3.4
	
Within the Term of Pledge, the Pledgors may, after obtaining prior consent from the Pledgee, receive dividends, bonuses or other profits generated from the Pledged Interests. The Pledgors agree that during the duration of the pledge of the equity interests, the Pledgee shall have the right to receive any dividend or bonus generated from the Pledged Interests. The Company shall pay such portion of fund to the bank account designated by the Pledgee.

 

	
4.
	
Custody of Pledge Certificate

 

Within the Term of Pledge set forth in this Agreement, the Pledgors shall deliver the capital contribution certificate for the equity interest in the Company and the register of shareholders containing the Pledge to the Pledgee for the Pledgee’s custody of such items. The Company shall not set up any register of shareholders other than the aforesaid one. The Pledgors shall deliver the above-mentioned capital contribution certificate and the register of shareholders to the Pledgee on the date of this Agreement, and the Pledgee shall maintain custody of such items throughout the entire Term of Pledge.

 

	
5.
	
Representations and Warranties of the Pledgors

 

	
 
	
5.1
	
The Pledgors are the legal owners of the Pledged Interests and there is no existing dispute in relation to the ownership of the Pledged Interests.

 

	
 
	
5.2
	
The Pledged Interests are free to be pledged and transferred according to laws, and the Pledgors have full rights and authorities to pledge the Pledged Interests to the Pledgee in accordance with the provisions of this Agreement.

 

	
 
	
5.3
	
The Pledgors have not placed any right of pledge or other security interests on the Pledged Interests except for the Pledge.

 

	
 
	
5.4
	
The Pledge under this Agreement constitutes the first priority right of pledge placed on the Pledged Interests.

 

	
 
	
5.5
	
The Pledgors and the Company warrant to the Pledgee that the above-mentioned representations and warranties are true and correct and will be completely complied with in any case before the Contract Obligations have been fully performed or the Secured Indebtedness has been completely repaid. 

 

	
6.
	
The Pledgors’ Covenants and Acknowledgements

 

	
 
	
6.1
	
The Pledgors hereby covenant to the Pledgee, that during the term of this Agreement, the Pledgors shall:

 

	
 
	
6.1.1
	
not transfer the Pledged Interests or create or permit the existence of any guarantee or other encumbrance on the Pledged Interests without prior written consent from the Pledgee, except for the performance of the Option Agreement;

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6.1.2
	
comply with and execute all the laws and regulations applicable to the pledge of rights, present the notice, order or recommendation issued or promulgated by relevant competent authorities regarding the Pledge to the Pledgee within 5 days upon receipt such item, and comply with the aforementioned notice, order or recommendation, or, as per reasonable requested or consent of the Pledgee, submit objections and representations with respect to the aforementioned matters;

 

	
 
	
6.1.3
	
promptly notify the Pledgee of any event or notice received by the Pledgors that may have an impact on the Pledgee’s rights to the equity interests or any portion thereof, and any event or notice received by the Pledgors that may have an impact on any warrant, obligation of the Pledgors or their performance of this Agreement.

 

	
 
	
6.2
	
The Pledgors agree that the right enjoyed by the Pledgee under the terms of this Agreement with respect to the Pledge shall not be interrupted or harmed by the Pledgors or any successor or representative of the Pledgors or any other person through any legal proceeding. 

	
 
	
6.3
	
The Pledgors guarantee the Pledgee that, in order to protect or perfect the security interests granted under this Agreement securing the payment of the consulting and service fees under the Transaction Agreements, the Pledgors agree to execute in good faith and to cause other parties who have an interest in the Pledge to execute all certificates, agreements, and/or perform and cause other parties who have an interest in the Pledge to perform as required by the Pledgee. The Pledgors further agree to facilitate the exercise by the Pledgee of its rights and authorities granted thereto by this Agreement, and to enter into all relevant documents regarding the ownership of equity interest with the Pledgee or designees of the Pledgee (individuals/legal entities). The Pledgors agree to provide the Pledgee within a reasonable time with all notices, orders and decisions regarding the Pledge that are required by the Pledgee.

	
 
	
6.4
	
The Pledgors guarantee the Pledgee that the Pledgors will comply with and perform all the guarantees, promises, agreements, representations and conditions under this Agreement. If the Pledgors is not performing or fail to fully perform its guarantees, promises, agreements, representations and conditions, the Pledgors shall compensate the Pledgee for all losses suffered thereby.

 

	
7.
	
Event of Default

 

	
 
	
7.1
	
Each of the following circumstances shall be considered as Event of Default:

 

	
 
	
7.1.1
	
Any breach of any of the Pledgors and/or the Company of any Contractual Obligation under the Loan Agreement, the Option Agreement, the Voting Rights Proxy Agreement, the Consulting Service Agreement, and/or this Agreement (and any amendment or restatement thereof);

 

	
 
	
7.1.2
	
Except for Article 6.1.1 of this Agreement, any waiver of the Pledgors of the Pledged Interests or any transfer or intended transfer of the Pledged Interests without written consent from the Pledgee;

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7.1.3
	
Any external loan, guarantee, compensation, commitment or other payment liability of any of the Pledgors and/or the Company is required to be repaid or performed in advance, or is expired but cannot be repaid or performed as scheduled, which, at Pledgee’s discretion, may be considered materially and adversely affect the ability of the Pledgors and/or the Company to perform its obligations hereunder;

 

	
 
	
7.1.4
	
Any occurrence of any material adverse change to the property of the Pledgors and/or the Company, which, at Pledgee’s discretion, may be considered materially affect the ability of the Pledgors and/or the Company to perform its obligations hereunder; and

 

	
 
	
7.1.5
	
Occurrence of any event that prevents the Pledgee to exercise its right with respect to the Pledge.

 

	
 
	
7.2
	
Upon notice or awareness of the occurrence of any circumstance or event that may lead to the above-mentioned circumstances described in Article 7.1, the Pledgors shall immediately notify the Pledgee in writing accordingly.

 

	
8.
	
Exercise of the Pledge

 

	
 
	
8.1
	
The Parties hereby agree that in the Event of Default, the Pledgee shall have the right to exercise all the rights and authorities of remedy for breach of contract enjoyed under the PRC laws, Transaction Agreements and this Agreement, including (but not limited to) auction or sale of the Pledged Interests and to be compensated in priority from what it gains after giving written notice to the Pledgors. The Pledgee is not responsible for any loss caused by its lawful and reasonable exercise of such rights and authorities.

 

	
 
	
8.2
	
Before the full payment of the consultation service fees and other fees under the Transaction Agreements has been made, the Pledgors shall not transfer the Pledge or the equity interest held in the Company without the Pledgee’s written consent.

 

	
 
	
8.3
	
For reasonable expenses incurred when the Pledgee exercises any or all of the above-mentioned rights and authorities, the Pledgee shall have the right to deduct such expenses from the funds obtained from the exercise of its rights and authorities, based on the actual situation.

	
 
	
8.4
	
The fund obtained from the exercise of the Pledgee of its rights and authorities shall be processed in the following order: 

 

Firstly, to pay for all expenses (including paying the emoluments of its attorneys and agents) arising from the disposal of the Pledged Interests and the exercise of the Pledgee of its rights and authorities;

 

Secondly, to pay payable taxes arising from the disposal of the Pledged Interests;

 

Thirdly, repay the Secured Indebtedness to the Pledgee;

 

6

 

 

The remaining fund after the deduction of the aforesaid items shall be returned by the Pledgee to the Pledgors or other person who enjoyed the right to the fund under relevant laws and regulations, or be deposited to the local notary office of the location of the Pledgee (any cost generated arising from such deposit shall be undertaken by the Pledgee).

 

	
 
	
8.5
	
The Pledgee has the right to appoint its legal counsels or other agents to exercise the Pledge on its behalf, and the Pledgor or the Company shall not raise any objections.

 

	
 
	
8.6
	
When the Pledgee disposes the Pledge in accordance with this Agreement, the Pledgors and the Company shall provide necessary assistance to enable the Pledgee to realize its Pledge.

 

	
 
	
8.7
	
The Pledgee shall be entitled to choose to, simultaneously or successively, exercise any of the remedies it enjoys for breach of contract. The Pledgee is not required to exercise any other remedy for breach of contract before exercising the right to auction or sell the Pledged Interests under this Agreement. The Pledgors or the Company does not have the right to challenge the Pledgee whether to exercise part of the Pledge or the sequential order of the exercise of the Pledge.

 

	
9.
	
Liability of Breach

 

	
 
	
9.1
	
The Pledgee has the right to terminate this Agreement and/or require the the Pledgor and the Company to fully indemnify the Pledgee if the Pledgor or the Company substantially breach any articles hereof; this article 9 shall not preclude any other rights of the Plegee hereunder.

 

	
 
	
9.2
	
Unless otherwise provided for by applicable laws, the Pledgor or the Company have no right to terminate or cancel this Agreement.

 

	
10.
	
Assignment

 

	
 
	
10.1
	
The Pledgors shall not grant or transfer its rights and obligations under this Agreement without prior consent from the Pledgee.

 

	
 
	
10.2
	
This Agreement shall be binding on the Pledgors, their successors and authorized assignees, and shall be valid to the Pledgee and each of its successors and assignees.

 

	
 
	
10.3
	
The Pledgee may assign all or any of its rights and obligations under the Transaction Agreements to its designees (individuals/legal entities) at any time. In such case, the assignee shall have the rights and obligations that the Pledgee enjoys and undertakes under this Agreement, as if it was the original party to this Agreement. When the Pledgee assigns the rights and obligations under the Transaction Agreements, the Pledgors shall, upon the Pledgee’s request, execute relevant agreements and/or documents relating to such assignment.

 

7

 

 

	
 
	
10.4
	
In the event of a change of the Pledgee due to the assignment, at the request of the Pledgee, the Pledgors shall execute a new pledge agreement with the new Pledgee on the same terms and conditions as this Agreement, and shall register such pledge with the relevant AIC.

 

	
 
	
10.5
	
The Pledgors shall strictly comply with the provisions of this Agreement and other relevant agreements jointly or respectively executed by the Parties, including the Exclusive Option Agreement and the Power of Attorney granted to the Pledgee, fulfill the obligations under each agreement, and refrain from any action/omission that may affect the effectiveness and enforceability of the Agreement. Any remaining right of the Pledgors with respect to the Pledged Interests hereunder shall not be exercised by the Pledgors except in accordance with written instructions from the Pledgee.

 

	
11.
	
Termination

 

	
 
	
11.1
	
Upon fully fulfilled its obligations hereunder and paid all the guaranteed debts, the Pledgor shall have the right to require the Pledgee to release the Pledge under this Agreement, within a reasonable time period, and the Pledgee shall taje necessary actions to deregister the Pledge with the relevant AIC.

 

	
 
	
11.2
	
Articles 9, 13, 14 and this article 11.2 will survive the termination of the Agreement.

 

	
12.
	
Service fees and other expenses

 

All fees and actual expenses relating to this Agreement, including but not limited to legal fees, costs of production, stamp duties, and any other tax, fee and etc. shall be borne by the Company.

 

	
13.
	
Confidentiality

 

Each Party hereto acknowledges and confirms to treat any oral or written material relating to this Agreement, the content of this Agreement and exchanged among for preparing or performing this Agreement as confidential information. Each party shall maintain the confidentiality of all such confidential information and shall not disclose any confidential information to any third party without the written consent of the other Parties, except for (a) any information is or will be acknowledged by the public (provided that it is not the result of a disclosure to the public without authorization made by a party who receives the confidential information); (b) any information required to disclose under the applicable laws and regulations, stock trading rules, or orders of government departments or courts; or (c) information required to be disclosed by any Party to its shareholders, investors, legal or financial counsels regarding the transaction stated in this Agreement, and such shareholders, legal or financial counsels shall also be required to comply with the confidentiality duties similar to the duties contained under this clause. Any disclosure by staff or agencies hired by a Party should be deemed as a disclosure by such party and such party shall be liable for breach of this Agreement. This article shall survive regardless of the termination of this Agreement for any reason. 

 

8

 

 

	
14.
	
Applicable Law and Dispute Resolution

 

	
 
	
14.1
	
The execution, effectiveness, interpretation, implementation, amendment and termination of this Agreement and the resolution of disputes shall be governed by PRC law.

 

	
 
	
14.2
	
Any dispute arising from interpretation and implementation of this Agreement shall be firstly solved by the Parties through friendly negotiation. If the dispute cannot be resolved within 30 days after the written notice sent from one party to the other for negotiation and resolution, any party may submit the relevant dispute to China International Economic and Trade Arbitration Commission for arbitration in accordance with the arbitration rules then effective. The arbitration shall be conducted in Shanghai and the language used is Chinese. The award of the arbitral tribunal shall be final and binding on the Parties.

 

	
 
	
14.3
	
When any dispute arising from interpretation and implementation of this Agreement occurs and when any dispute is under arbitration, except for the matters under dispute, the Parties shall continue to exercise their other rights under this Agreement and perform their other obligations under this Agreement.

 

	
15.
	
Notices

 

	
 
	
15.1
	
All notices and other communications required or sent under this Agreement shall be delivered personally, registered post, postage paid or business express service or fax to the Party’s following address. Each notice shall also be delivered by email. The dates on which the notices shall be deemed to have been effectively delivered shall be determined as follows:

 

	
 
	
15.2
	
For notices delivered by personal delivery, express service or registered post, postage paid, the effectively delivered date shall be deemed as the date of delivery or refusal at the address specified for notices.

 

	
 
	
15.3
	
For the notices delivered by fax, the effectively delivered date shall be deemed as the date of delivered successfully. (as evidenced by an automatically generated confirmation of transmission)

 

	
 
	
15.4
	
For the purpose of notice, the addresses of the Parties are as follows:

 

The Pledgors:

 

Biao Liu

Address: [REDACTED]

Recipient: [REDACTED]

Mobile:  [REDACTED]

 

Zhongyuan Zhang

Address: [REDACTED]

Recipient: [REDACTED]

Mobile:  [REDACTED]

 

9

 

 

The Pledgee: Shanghai Quyun Internet Technology Co., Ltd.

Address: [REDACTED]

Recipient: [REDACTED]

Mobile:  [REDACTED]

 

The Company: Shanghai DragonS Information Technology Co., Ltd.

Address: [REDACTED]

Recipient: [REDACTED]

Mobile:  [REDACTED]

 

	
 
	
15.5
	
Any Party may at any time send notice to other Parties in accordance with this Article to change its address for the purpose of receiving notice.

 

	
16.
	
Severability

 

If one or several provisions of this Agreement are found to be invalid, illegal or unenforceable according to any law or regulation in any aspect, the validity, legality or enforceability of the remaining provisions of this Agreement shall not be affected or damaged in any aspect. The Parties shall strive for replacing those invalid, illegal or unenforceable provisions with effective provisions within the highest limit of permission of laws and expectation of the Parties by sincerely negotiation, and the economic effects of such effective provisions shall as close as possible to that of those invalid, illegal or unenforceable provisions.

 

	
17.
	
Effectiveness

 

	
 
	
17.1
	
This Agreement shall become effective upon execution of the Agreement by all Parties.

 

	
 
	
17.2
	
Any amendment, supplement or change to this Agreement shall be made in writing and shall become effective upon completion of the governmental filing procedures (if applicable) after execution or affixing with seals of the Parties.

 

	
 
	
17.3
	
This Agreement is written in Chinese in four (4) originals. Each Party of this Agreement shall have one (1) and all the originals shall have equal legal validity.

 

[The remainder of this page intentionally left blank.]

10

 

 

[Signature Page]

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the date first above written.

 

	
Biao Liu
	
 

	
Signature:
	
/s/ Biao Liu
	
 

 

	
Zhongyuan Zhang
	
 

	
Signature:
	
/s/ Zhongyuan Zhang
	
 

 

Shanghai Quyun Internet Technology Co., Ltd.

(Seal)

 

	
Signature:
	
/s/ Lei Li
	
 

	
Name: Lei Li
	
 

	
Title: Legal Representative
	
 

 

Shanghai DragonS Information Technology Co., Ltd.

(Seal)

 

	
Signature:
	
/s/ Biao Liu
	
 

	
Name: Biao Liu
	
 

	
Title: Legal Representative
	
 

 

 

 

The Signature Page of Share Pledge Agreement

 

 

Schedule I

Company Name: Shanghai DragonS Information Technology Co., Ltd.

Shareholding Structure:

 

			
	
Shareholder Name
	
Amount of Contribution of Company’s registered capitals

(RMB/Yuan)
	
Shareholding Ratio

	
Biao Liu
	
6,000,000
	
60%

	
Zhongyuan Zhang 
	
4,000,000
	
40%

	
Total
	
10,000,000
	
100%

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