Document:

Exhibit 10.2

 

Equity Pledge Agreement

 

This Equity Pledge Agreement (hereinafter referred to as “this Agreement”) is signed in Hangzhou, China on 4th October 2018 among the following Parties:

 

Party A:       Hangzhou Yihan Technology Co., Ltd. is a limited liability company duly incorporated and validly existing under the laws of the People’s Republic of China, with its office in Room 410, F4, Building A11, No.9 Jiusheng Road, Jianggan District, Hangzhou.

 

(Hereinafter referred to as “Pledgee”)

 

Party B:       Hangzhou Xinghui Business Management Consulting Co., Ltd. is a limited liability company duly incorporated and validly existing under the laws of the People’s Republic of China, with its office in Room 409, F4, Building A11, No.9 Jiusheng Road, Jianggan District, Hangzhou, Zhejiang Province.

 

Feng Min, whose ID number is #####, with address of #####

 

(Hereinafter referred to as “Pledgor”)

 

Party C:       Hangzhou Hanyi E-commerce Co., Ltd. is a limited liability company duly incorporated and validly existing under the laws of the People’s Republic of China, with its office in Room 410, F4, Building A13, No.9 Jiusheng Road, Jianggan District, Hangzhou.

 

In this agreement, the Pledgee, Pledgor and Party C are individually called “Party” and collectively referred to as “Parties”.

 

Whereas:

 

1.                                          The Pledgor owns 100% equity of Party C. Party C is a limited liability company registered in Hangzhou, China. Party C acknowledges and confirms the Pledgor’s and Pledgee’s rights and obligations under this agreement. Party C agrees to provide all necessary assistance for equity pledge (including the pledge registration) under this agreement;

 

2.                                      The Pledgee is a wholly owned foreign enterprise registered in Hangzhou, Zhejiang Province. The Pledgee and Party C entered into the Exclusive Business Cooperation Agreement (hereinafter referred to as the “Business Cooperation Agreement”) on 4th October 2018. The Pledgee shall provide Party C with related exclusive technical services, technical consultations and other services based on the Exclusive Business Cooperation Agreement.

 

3.                                      The Parties hereunder signed an exclusive call option agreement (hereinafter referred to as the “Exclusive Call Option Agreement”) on 4th October 2018. To the extent permitted by PRC Laws and corresponding requirements, the Pledgor shall transfer Party C’s equity it holds to the Pledgee, and/or any other entity or individual designated by the Pledgee in whole or in part according to the Pledgee’s requirements provided that the Pledgee decides to buy the equity.

 

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4.                                      The Parties hereunder sign a proxy agreement on shareholders’ voting rights (hereinafter referred to as the “Proxy Agreement on Shareholders’ Voting Rights”) on 4th October 2018. The Pledgor has irrevocably entrusted the person designated by the Pledgee with the full power to exercise all her rights to entrust and vote as Party C’s shareholder.

 

5.                                      The Pledgor shall pledge, in favour of the Pledgee, the Pledged Equity Interests for securing the complete and due performance of the contractual obligations and debt settlement. Party C agrees with such equity pledge arrangement.

 

1.                                      Definitions

 

Unless otherwise defined hereunder, the following terms shall have the meanings as follows:

 

1.1                               “Pledgee’s Right” shall refer to the security interests granted to the Pledgee according to Article 2 of this agreement, namely the Pledgee’s Rights to enjoy the priority of compensation from equity discounts, transfer, auction or sales.

 

1.2                               “Equity” shall refer to all Party C’s equity lawfully held by the Pledgor from the effective date of this agreement, such that the Pledgor has rights to dispose and pledge it to the Pledgee according to provisions of this agreement as guarantee for Party C’s fulfillment of its obligations and debts hereunder (including the Pledgor’s current equity constituting Party C’s registered capital and all related equity) and increase equity as per Article 6.7 of this agreement.

 

1.3                               “Pledge term” shall have the meaning specified in Article 3 of this agreement.

 

1.4                               “Default” shall refer to any circumstance listed in Article 7 of this agreement.

 

1.5                               “Default notices” shall refer to the notices for announcing defaults issued by the Pledgee as per this agreement.

 

1.6                               “Contractual obligations” shall refer to all the Pledgor’s contractual obligations under the Exclusive Option Agreement and the Proxy Agreement on Shareholders’ Voting Rights; all Party C’s contractual obligations under the Business Cooperation Agreement, Exclusive Option Agreement and Proxy Agreement on Shareholders’ Voting Rights; and all the Pledgor’s and Party C’s contractual obligations under this agreement.

 

1.7                               “Transaction agreements” shall refer to the Business Cooperation Agreement, Exclusive Option Agreement and Proxy Agreement on Shareholders’ Voting Rights, or either of such agreements.

 

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1.8                               “Collateralized debts” shall mean (i) any or all debts that Party C owes to the Pledgee, including but not limited to consultation and service fees that Party C shall pay to the Pledgee according to the Business Cooperation Agreement on the given maturity date, ahead of time or in other ways, compensation, lawyers’ fees, arbitration fees, and fees for exercising rights of pledge such as equity evaluation and auction; (ii) all the Pledgee’s direct, indirect or derivative and foreseeable losses resulting from any default of the Pledgor or Party C. The basis for determining the amount of such losses shall include without limitation the Pledgee’s reasonable business plans and earnings forecasts, and all expenses incurred when the Pledgee forces the Pledgor and/or Party C to perform their contractual obligations.

 

1.9                               “PRC Laws” shall include all laws, regulations, rules, notices, interpretations or other binding documents legislated by any central or regional legislation, administrative or judicial department.

 

1.10                        “Security interests” shall include security, mortgage, third-party rights or interests, all rights to purchase equity, rights of acquisition, pre-emptive rights, rights of set-off, retained title or other collateral arrangements.

 

2.                                      Pledgee’s Right

 

2.1                               The Pledgor hereby pledges the Equity to the Pledgee in the first order of priority to guarantee prompt and full debt repayment and performance of contractual obligations. Party C agrees that the Pledgor may pledge the equity to the Pledgee as per this agreement.

 

2.2                               All Parties understand and acknowledge that the estimated monetary value generated for guaranteeing debts or related estimated value shall be changeable and floating until the settlement date (refer to Article 2.4 for the definition). The Pledgor and the Pledgee may adjust and confirm the maximum amount of debts guaranteed by the equity from time to time by the settlement date by revising and supplementing this agreement with both Parties’ consent in case of any change to the estimated monetary value of guaranteed debts and equity.

 

2.3                               In any of following events (hereinafter referred to as “events for settlement”), the value of guaranteed debts shall be determined based on the total amount of payable guaranteed that is not paid to the Pledgee on the latest date before any event for settlement occurs or on the date of the event (hereinafter referred to as “confirmed debts”):

 

(a)                                 The Business Cooperation Agreement has expired or has been terminated according to the relevant articles;

 

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(b)                                 The Pledgee issues a default notice to the Pledgor as per Article 7.3, because any default specified in Article 7 of this agreement has occurred and is still unsolved;

 

(c)                                  After proper investigation, the Pledgee reasonably determines that the Pledgee and/or Party C have become insolvent or might become insolvent; or

 

(d)                                 Any other event occurs, under which guaranteed debts shall be determined as per PRC laws, rules and regulations.

 

2.4                               To avoid ambiguity, the date on which the event for settlement occurs shall be deemed the settlement date (hereinafter referred to as the “settlement date”). The Pledgee shall have rights to exercise the rights of pledge as per Article 8 at its discretion on the settlement date or thereafter.

 

2.5                               Within the pledge term (refer to Article 3.1 for definition), the Pledgee shall have rights to accept any dividend, bonus or other distributable interests generated because of the equity. The Pledgor shall deposit or cause Party C to deposit such fructus in the account designated by the Pledgee in writing after receiving the Pledgee’s written requirements, or use such fructus for repaying guaranteed debts in advance. The Pledgor shall not withdraw such fructus deposited in the account deposited in the account designated by the Pledgee in writing without the written consent of the Pledgee.

 

2.6                               Within the term of this agreement, the Pledgee shall not assume any responsibility for any equity depreciation unless otherwise caused by the Pledgee’s intentions or gross negligence. In this case, the Pledgor shall have no right to make any claim or request to the Pledgee.

 

2.7                               Without violating Article 2.6 of this contract, the Pledgor agrees that the Pledgee may auction or sell the equity on behalf of the Pledgor anytime provided that any value of the equity is likely to decline and thereby probably impairs the Pledgee’s Rights, and the Pledgor agrees that the proceeds from such auction or sales shall be used for debt repayment or such money shall be held in escrow by a notary office of the area where the Pledgee is. All expenses thereby incurred shall be deducted from the proceeds from such auctions or sales. In addition, the Pledgor shall provide other property as guarantee to the Pledgee’s satisfaction, when there is a likelihood that any value of the equity might decline significantly and will probably impair the Pledgee’s Rights, the Pledgor must promptly notify the Pledgee, and take necessary actions to handle above events or minimize their adverse impacts in accordance with the Pledgee’s reasonable requirements, or else the Pledgor shall compensate the Pledgee for all direct or indirect losses thereby incurred.

 

2.8                               The equity pledge hereunder is a continuous guarantee. It shall be effective until full performance of all contractual obligations and full repayment of guaranteed debts. The Pledgee’s exemption or tolerance of the Pledgor’s any default or the Pledgee’s late exercising of any right under Transaction Agreements and this agreement shall not affect the Pledgee’s subsequent rights to ask the Pledgor or Party C to strictly perform the Transaction Agreements and this agreement thereafter according to this agreement, related PRC Laws and Transaction Agreements, or affect the Pledgee’s subsequent rights against the Pledgor’s or Party C’s breach of the Transaction Agreements and/or this agreement.

 

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3.                                      Pledge Term

 

3.1                               The Pledgee’s Right shall take effect from the date on which it is registered with the administration for industry and commerce of the area where Party C is (hereinafter referred to as the “registration authority”). The Pledgee’s Right shall be valid from such effective date and expire when the last guaranteed debt and contractual obligation is repaid and fulfilled, and the Pledgee agrees to buy all Party C’s equity held by the Pledgor to the extent permissible by PRC laws.

 

3.2                               The Pledgee shall be authorized but not obliged to dispose of the Pledgee’s Right according to this contract provided that Party B and/or Party C fails to perform the contractual obligations or repay the guaranteed debts (including paying for exclusive consultations or services or failing to perform other obligations under any Transaction Agreement) within the pledge term.

 

4.                                      Registering the Pledgee’s Right and Keeping Equity Records within the Pledge Term

 

4.1                               The Pledgor and Party C agree and undertake that, after signing this agreement, Party C must immediately and the Pledgor must procure Party C to immediately record the arrangements for the equity pledge hereunder on Party C’s Register of Shareholders on the date of signing this agreement; and an application shall be submitted to the registration authority for registering (or changing) the equity pledge according to the Measures for the Registration of Equity Pledge at Administrative Departments for Industry and Commerce within 20 days after signing this agreement. The Pledgor and Party C further agree and undertake to handle all formalities for registering the equity pledge and get the registration notice from the registration authority within 30 days after the application for registering the equity pledge is formally accepted by the registration authority. The registration authority shall completely and accurately record matters about such equity pledge on the register of equity pledge.

 

4.2                               Within the pledge term specified hereunder, the Pledgor shall submit original contribution certificate for the equity and the register of shareholders documenting pledge (and other documents reasonably required by the Pledgee, including but not limited to the notice on pledge registration issued by the administration for industry and commerce) to the Pledgee. The Pledgee shall keep such documents within the entire pledge term specified hereunder.

 

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5.                                      Representations and Warranties of the Pledgor and Party C

 

The Pledgor represents and warrants to the Pledgee as follows:

 

5.1                               The Pledgor has complete and independent legal status and capacity under PRC Laws. Besides, the Pledgor has been legitimately authorized to sign, deliver and perform this agreement. The Pledgor may be an independent subject of litigations.

 

5.2                               The Pledgor is the sole legal owner and beneficiary of the equity. The Pledgor has full rights and power to pledge the equity to the Pledgee according to this agreement, while the Pledgor shall be also authorized to dispose of the equity and any part of the equity. Unless the Pledgor and the Pledgee additionally enter into an agreement, the Pledgor shall possess the legitimate and full title of the equity,

 

5.3                               The Pledgee shall have rights to dispose and transfer the equity as per this agreement.

 

5.4                               Except for the Pledgee’s Right, the Pledgor doesn’t set any security interest or other encumbrances on the equity. There is no dispute on the equity ownership, outstanding tax or fee on the equity. The ownership of the equity isn’t detained or subject to restraints of other legal proceedings or similar threats and can be pledged and transferred according to applicable laws.

 

5.5                               The Pledgor’s signing of this agreement or exercising of any right hereunder or performance of obligations hereunder will not violate or go against any laws, regulations, court awards, arbitration authority’s awards, administrative authorities’ decisions, agreements or contracts binding upon the Pledgor’s assets under which the Pledgor is party, or any commitments that the Pledgor makes to any third party.

 

5.6                               All documents, materials, statements and vouchers that the Pledgor offers to the Pledgee shall be accurate, true, complete and effective no matter if they are offered before or after this agreement takes effect or within the pledge term.

 

5.7                               This agreement shall constitute lawful, valid and binding obligations on the Pledgor after it is appropriately signed by the Pledgor.

 

5.8                               The Pledgor has full rights and authorities to sign and deliver this agreement and all other documents on aforementioned transactions hereunder to be signed. In addition, the Pledgor has full rights and authorities to complete such transactions.

 

5.9                               Apart from registering the equity pledge with a registration authority, any third party’s consent, permission, waiver or authorization, or any government organization’s approval, permission or exemption, or registration or filing formalities handled with any government agency, which are necessary for signing and performing this contract and making the equity pledge effective hereunder, have been obtained or handled, and will keep fully effective within the term of this agreement.

 

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5.10                        The pledge hereunder constitutes the first security interests in the equity under this contract.

 

5.11                        All taxes and fees for obtaining the equity have been fully paid by the Pledgor.

 

5.12                        The Pledgor, or its property or equity is not subject to any outstanding lawsuits, legal proceedings or requests or those that are known by the Pledgor to be threatening from any court or arbitration tribunal. Besides, The Pledgor, or its property or equity is not subject to any of such lawsuits, legal proceedings or requests from any government agency or administrative authority. There is no material or adverse impacts imposed upon the Pledgor’s economic conditions or abilities to fulfill obligations and perform the guarantee responsibilities hereunder.

 

5.13                        Unless otherwise specified hereunder, the Pledgee shall not be hindered from exercising its rights as Pledgee hereunder anywhere and anytime.

 

5.14                        Hereby, the Pledgor agrees to assume joint liability for all Party C’s statements and warranties under this agreement.

 

5.15                        The Pledgor undertakes to the Pledgee that all these statements and warranties shall be true, correct, accurate, complete and fully obeyed anytime under all circumstances before all contractual obligations are fulfilled or guaranteed debts are fully repaid.

 

Party C represents and warrants to the Pledgee as follows:

 

5.16                          Party C is a limited liability company lawfully incorporated and validly existing under PRC laws. Being qualified as independent legal entity, it may act as independent subject of litigation. Formally registered with a competent administration for industry and commerce, Party C has passed all previous annual reports or lawfully submitted the annual reports. With complete and independent legal status and standing, Party C has been appropriately authorized to sign, deliver and perform this agreement.

 

5.17                        This contract shall constitute legitimate, effective and binding obligations upon Party C after it is appropriately signed by Party C and takes effect.

 

5.18                        Party C owns the full power and authorities to sign and deliver this agreement and all other documents related to transactions hereunder. Party C also owns the full power and authorities to complete such transactions.

 

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5.19                        There is no material security interest or other encumbrance which might affect the Pledgee’s Rights or interests in equity, including but not limited to transfer of any of Party C’s intellectual property or any assets with a worth no less than RMB500,000, or any encumbrance in property or rights to use such assets.

 

5.20                        The equity, or Party C or its assets are not subject to any outstanding lawsuits, arbitrations or other legal proceedings or those known to be threatening by Party C from any court or arbitration tribunal. Besides, the Pledgor, or its property or equity is not subject to any of such lawsuits, arbitrations or legal proceedings from any government agency or administrative authority. There is no material or adverse impacts imposed upon Party C’s economic conditions or the Pledgor’s or Party C’s abilities to perform the obligations and guarantee responsibilities hereunder.

 

5.21                        Hereby, Party C agrees to assume joint liability for the Pledgor’s representations and warranties under this agreement.

 

5.22                        Party C’s signing of this contract and exercising of its rights hereunder or fulfillment of its obligations under this agreement will not violate or conflict with any laws, rules, any court judgments, any arbitration authority’s awards, any administrative authority’s decisions, any agreement or contract under which Party C is bound as a party or its assets are bound, or any commitment that Party C makes to any third party.

 

5.23                        All documents, materials, statements and proofs that Party C offers to the Pledgee shall be accurate, true, complete and valid no matter whether they are provided before or after this agreement takes effects within the pledge term.

 

5.24                        Apart from registering the equity pledge with a registration authority, any third party’s consent, permission, waiver or authorization, or any government organization’s approval, permission or exemption, or registration or filing formalities handled with any government agency, which are necessary for signing and performing this contract and making the equity pledge effective hereunder, have been obtained or handled, and will continue to be effective within the term of this agreement.

 

5.25                        The pledge hereunder constitutes the first lien secured interests in the equity under this contract.

 

5.26                        Party C hereby undertakes to the Pledgee that all the above representations and warranties shall be true and correct under any circumstance at any time before all contractual obligations are performed or guaranteed debts are fully repaid, and Party C will completely abide by such representations and warranties.

 

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6.                                      Undertakings and Further Consents of the Pledgor and Party C

 

The Pledgor undertakes and further agrees that:

 

6.1                               Within the term of this agreement, the Pledgor specially undertakes to the Pledgee that,

 

6.1.1                     Except for performing the Exclusive Call Option Agreement, the Pledgor shall not transfer or permit others to transfer the equity in whole or in part, impose or permit others to impose any new pledge, security interests or other encumbrance on the equity which might affect the Pledgee’s Rights and interests in the equity without the prior written consent of the Pledgee. For the equity transfer performed with the Pledgee’s written consent, the Pledgor shall firstly use the proceeds  from such equity transfer for repaying guaranteed debts to the Pledgee or hold the proceeds in escrow by a third person designated by the Pledgor.

 

6.1.2                     The Pledgor must obey and exercise all laws, rules and regulations applicable to Pledgee’s Rights. Within 5 days after receiving any notice, order or suggestion on pledge from related competent authorities (or any other related departments), the Pledgor shall show the Pledgee such notices, orders or suggestions, or bring forth objections or statements regarding them according to the Pledgee’s reasonable requirements or with the Pledgee’s consent.

 

6.1.3                     The Pledgor shall immediately notify the Pledgee of all events which might affect the Pledgee, the equity, or any rights of the Pledgee, or any events affecting the interests under Transaction Agreements and this agreement (including but not limited to any lawsuit, arbitration, other requests, any third party’s dispute over the equity title, any civil or criminal/administrative proceedings, arbitrations or any other legal proceedings filed against the Pledgor or equity when the Pledgee’s pledge is or might be subject to any third party’s adverse impacts, or potential threats of confronting any aforementioned lawsuit, arbitration or legal proceeding judged by the Pledgor), notices received by the Pledgor, and any event which might affect any warranties or obligations of the Pledgor under this agreement, and take all necessary measures to protect the Pledgee’s Rights and interests in the pledged equity according to the Pledgee’s reasonable requirements.

 

6.2                               The Pledgor agrees that the Pledgee’s exercise of the Pledgee’s Right hereunder shall not be interrupted by the Pledgor or any successor or representative of the Pledgor or any others through legal proceedings.

 

6.3                               To protect or improve the security interests granted for repaying debts and performing contractual obligations, and ensure the Pledgee’s exercise of the security interests over the pledged equity and such rights, the Pledgor hereby specially undertakes to register the equity pledge hereunder with related registration authority within 20 days after signing this agreement. Besides, the Pledgor shall appropriately sign and cause other Parties concerned in the equity pledge to sign all documents designated by the Pledgee (including but not limited to the supplemental agreement of this agreement), certificates, agreements, deeds and/or undertakings. The Pledgor also undertakes to take and cause other Parties concerned in the equity pledge to take actions required by the Pledgee, assist the Pledgee in exercising its rights and authorities hereunder, and sign all related documents regarding the equity title with the Pledgee or the party designated by the Pledgee (natural person/legal person). The Pledgor undertakes to provide the Pledgee with all notices, orders and decisions on the Pledgee’s Right within reasonable deadlines at the Pledgee’s request.

 

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6.4                               The Pledgor hereby specially undertakes to the Pledgee to obey and perform all warranties, undertakings, agreements, statements and requirements under this agreement. The Pledgor shall compensate the Pledgee all losses thereby incurred if the Pledgor fails to perform or only partially performs its warranties, undertakings, agreements, statements and requirements hereunder.

 

6.5                               The Pledgor shall make every effort (including offering other guarantees to the court or taking other measures to rescind the court’s or other departments’ coercive measures against the equity) in case that any court or other government agency takes any compulsory measures against the equity pledged hereunder.

 

6.6                               If the equity is concerned in any property preservation or compulsory enforcement, or is likely to depreciate or be loss to impair the Pledgee’s Rights, the Pledgor shall immediately inform the Pledgee of such circumstances in writing, and cooperatively take effective measures for protecting the Pledgee’s Rights and interests together with the Pledgee, including but not limited to offering extra property as mortgage or guarantee. If the Pledgor refuses to offer such mortgage or guarantee, the Pledgee may auction or sell the equity anytime, and firstly use the proceeds from such auction or sales for advance debt repayment or drawing. All expenses thereby incurred shall be borne by the Pledgor.

 

6.7                               Without the Pledgee’s prior written consent, the Pledgor and/or Party C shall not or help others increase, reduce or transfer Party C’s registered capital (or their amount of contributions to Party C), or impose any encumbrance on the registered capital (including the equity). On the premise of following this provision, Party C’s equity that the Pledgor registers and obtains after the signing date of this agreement (hereinafter referred to as the “extra equity”) and corresponding capital stock of such equity in Party C’s registered capital must be also deemed the equity that the Pledgor pledges to the Pledgee in accordance with this agreement. The Pledgor and Party C shall immediately enter into a supplementary equity pledge agreement on the extra equity with the Pledgee at the time of obtaining such extra equity, request Party C’s Board of Directors (executive director) and Shareholders’ Committee to approve the supplementary equity pledge agreement. Besides, they shall offer the Pledgee all necessary documents for signing the supplementary equity pledge agreement, including but not limited to: (a) the original capital contribution certificate on such extra equity issued by Party C, and (b) capital verification report on the extra equity issued by Chinese certified public accountants or duplicates of other capital contribution certificates. The Pledgor and Party C shall handle formalities for registering the pledge of such extra equity as per Article 4.1 of this agreement, and deliver related documents to the Pledgee for safekeeping according to Article 4.2 of this agreement.

 

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6.8                               Unless otherwise instructed by the Pledgee in writing in advance, the Pledgor and/or Party C agree that if the shares are transferred between the Pledgor and any third party (hereinafter referred to as the “share assignee”) against this agreement in part or in whole, the Pledgee and/or Party C shall ensure that the share assignee unconditionally admits the pledge and handles the necessary formalities for registering the pledge changes (including but not limited to signing related documents) in order to guarantee survival of the Pledgee’s Right. The Pledgor’s and/or Party C’s performance of this article shall not be construed as the Pledgee’s waiver of claims regarding their breach of this agreement. Hereby, the Pledgee preserves its rights to investigate their breach.

 

6.9                               If the Pledgee renders loans to Party C, the Pledgor and/or Party C agree to grant the Pledgee the Pledgee’s Right by pledging the equity as collateral, in order to guarantee the loan, and handle related formalities as soon as possible according to laws, regulations or local practices (if any), including but not limited to signing related documents and handling formalities for registering pledge or pledge changes.

 

6.10                        The Pledgor shall not or allow anyone to take any actions which might have adverse effects on the Pledgee’s Rights or equity under the Transaction Agreements and this agreement. Hereby, the Pledgor irrevocably waivers the pre-emptive rights when the Pledgee exercises the Pledgee’s Right.

 

6.11                        When it is necessary to transfer any equity for exercising the Pledgee’s Right hereunder, the Pledgor undertakes to make such transfer possible by taking all measures.

 

6.12                        The Pledgor shall ensure that the procedures for convening meetings and ways for voting/making decisions by the Shareholders’ Committee and the Board of Directors (or the executive director) for signing this agreement, imposing pledges and exercising the Pledgee’s Right do not violate laws, administrative regulations or Party C’s articles of associations.

 

6.13                        Before all contractual obligations are fulfilled and guaranteed debts are fully repaid, the Pledgor shall not waive the equity pledged to the Pledgee as per this agreement, and/or waive the fructus generated for holding such equity, including but not limited to dividends.

 

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6.14                        Before all contractual obligations are fulfilled and guaranteed debts are fully repaid, the Pledgor shall not allow Party C to transfer, sell or dispose of any of its assets in any other way through any resolution without the Pledgee’s prior written consent.

 

6.15                        The Pledgor shall not sign any document or make any related commitments (which have conflicts of interests with the agreements which have been signed and are being performed) with a third party other than Party C or the Pledgee or the nominee. The Pledgor shall not cause conflicts of interests among the Pledgor, the Pledgee and shareholders. In case of any such conflict of interests (the Pledgee shall have rights to unilaterally confirm if there is any such conflict of interests), the Pledgor shall try its best to promptly take measures to eradicate such conflicts with the Pledgee’s or its nominee’s prior written consent. The Pledgee shall be authorized to exercise the call options under the Exclusive Call Option Agreement if the Pledgor refuses to take actions to eliminate interests of conflicts.

 

6.16                        If any revision, supplementation or update of this agreement cannot take effect until the corresponding procedures for examination/approval and/or registration of pledge changes are completed as stipulated by applicable laws, the Pledgor shall register such changes with the relevant registration authorities within 5 days of the revision, supplementation or update.

 

Party C undertakes and further agrees that:

 

6.16                        If any third party’s consent, permission, waiver or authorization or any government organization’s approval, permission or exemption or registration or filing with any government organizations are necessary for signing/performing this agreement and pledging the equity hereunder, Party C shall try its best to assist in handling such formalities and keep them fully effective within the term of this agreement. Party C shall handle registration formalities for extending its business term if it expires within the term of this agreement, in order to maintain effectiveness of this agreement.

 

6.17                        Without the Pledgee’s prior written consent, Party C shall not help or allow the Pledgor to impose any new pledge on equity, or authorize any other security interests or encumbrances, or help or permit the Pledgor to transfer the equity.

 

6.18                        Party C agrees to strictly perform the obligations under articles 6.3, 6.7, 6.8, 6.9, 6.11, 6.12, 6.14 and 6.15 with the Pledgor.

 

6.19                        Without the Pledgee’s prior written consent, Party C shall not transfer or sell Party C’s assets or impose or allow others to impose any security interests or other encumbrances which might impact the Pledgee’s equity rights and interests, including but not limited to transfer of any of Party C’s intellectual property or any assets with a worth of no less than RMB500,000 or any encumbrance in property or rights to use such assets.

 

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6.20                        When there is any lawsuit, arbitration or other request which might have adverse impacts upon interests of Party C, equity or the Pledgee under Transaction Agreements and this agreement, Party C undertakes to promptly notify the Pledgee in writing, and take all necessary measures for protecting the Pledgee’s Rights and interests over the pledged equity according to the Pledgee’s reasonable requests.

 

6.21                        Party C shall not or allow anyone to take any actions which might have adverse impacts upon the Pledgee’s Rights or equity under the Transaction Agreements and this agreement.

 

6.22                        Party C shall provide the Pledgee with financial statements of the preceding quarter of the Gregorian calendar (including but not limited to the balance sheet, income statement and cash flow statement) within the first month of each quarter of the Gregorian calendar.

 

6.23                        Party C undertakes to take all necessary measures and sign all requisite documents according to the Pledgee’s reasonable requirements, so as to protect the Pledgee’s Rights and interests in the pledged equity, exercise and realize such rights and interests.

 

6.24                        When it is necessary to transfer any equity for exercising of the Pledgee’s Right hereunder, Party C undertakes to make such transfer possible by taking all measures.

 

6.25                        When the Pledgor is subject to liquidation, bankruptcy, dissolution, termination, death, loss of capacity or other circumstances which might impact its exercising of Party C’s equity, the Pledgor’s successor, or Party C’s current shareholder or assignee shall be deemed as Party of this agreement to inherit/bear all of the Pledgor’s rights and obligations under this agreement.

 

6.26                        This agreement shall be terminated if Party C is required to be dissolved or liquidated by PRC laws; Party C and Party B shall transfer all their assets (including the equity) to Party A without charge or at the minimum prices and within the limits permitted by current Chinese laws, or the current liquidator shall dispose of all Party C’s assets (including the equity) at its discretion for the purpose of protecting interests of shareholders and/or creditors of Party A’s direct or indirect parents overseas.

 

6.27                        All Parties undertake to each other that they shall terminate this agreement immediately once the Pledgee is permitted by PRC laws and the Pledgee decides to purchase all of Party C’s equity from the Pledgor in accordance with the Exclusive Option Agreement.

 

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7.                                      Defaults

 

7.1                               All of following circumstances shall be deemed defaults:

 

7.1.1                     The Pledgor violates or fails to perform any contractual obligations under the Exclusive Option Agreement, the Power of Attorney and/or this Agreement; Party C violates or fails to perform any contractual obligations under the Exclusive Option Agreement, Power of Attorney and/or this agreement.

 

7.1.2                     Any statements or undertakings made by the Pledgor under Article 5 of this agreement contain material misstatements or errors, and/or the Pledgor violates any undertakings under Article 5 of this agreement, and/or any commitments under Article 6 of this agreement;

 

7.1.3                     The Pledgor and Party C fail to register equity pledge with related registration authority according to Article 4.1;

 

7.1.4                     The Pledgor and Party C violate any rules or articles of this agreement;

 

7.1.5                     Unless otherwise clearly specified in Article 6.1.1, the Pledgor transfers or intends to transfer or waivers pledged equity or transfers pledged equity without the Pledgee’s written consent;

 

7.1.6                     The Pledgor’s loans, undertakings, compensations, commitments or other debts to a third party (1) are required to be repaid or performed ahead of time due to the Pledgor’s breach of the relevant agreement with the third party; or (2) have become due, but cannot be repaid or performed on time;

 

7.1.7                     The Pledgor cannot repay general debts or other debts;

 

7.1.8                     Any approval, license, consent, permission or authorization from government organizations making this agreement compulsorily enforceable, legitimate and effective is revoked, terminated, nullified or changes substantively;

 

7.1.9                     The promulgation of applicable laws makes this agreement illegal or makes it impossible for the Pledgor to continue to perform the obligations hereunder;

 

7.1.10              The Pledgee believes that the Pledgor’s abilities to fulfill its obligations hereunder have been affected in case of adverse changes to the Pledgor’s property.

 

7.1.11              Party C or its successor or trustee can only partially perform or refuses to perform its payment responsibilities under the Business Cooperation Agreement, and/or Party C can only partially repay or refuse to repay the guaranteed debts;

 

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7.1.12              Any other circumstances under which the Pledgee can’t or might not exercise its rights of pledge hereunder.

 

7.2                               The Pledgor shall immediately notify the Pledgee in writing once any circumstances mentioned in Article 7.1 are known or discovered, or any events leading to above circumstances have occurred.

 

7.3                               Unless the defaults listed in Article 7.1 have been solved to the Pledgee’s satisfaction within 30 days after receiving the Pledgee’s notice, the Pledgee may issue a default notice to the Pledgor when such defaults occur or any time after the occurrence, and exercise all its remedial rights and power against the defaults under PRC laws, transaction agreements and this agreement, including but not limited to:

 

(a)               asking the Pledgor and/or Party C to immediately make all outstanding payments due under the Business Cooperation Agreement, repay all debts due under the transaction agreements, make other payables due to the Pledgee, and/or repay the loan; and/or

 

(b)               Dispose of the Pledgee’s Right according to Article 8 of this agreement; and/or dispose of the pledged equity in other ways (including but not limited to giving discounts to the equity in whole or in part, and enjoying the priority of compensation from the proceeds of the equity auction and sales).

 

The Pledgee shall have rights to exercise any of such rights based on its independent judgments and choices. Under this situation, all other Parties of this agreement shall unconditionally agree and fully collaborate. The Pledgee shall not assume any responsibility for any loss resulting from its appropriate exercise of such rights and power.

 

7.4                               The Pledgee shall be authorized to appoint its lawyer or other agent in writing to exercise any and all such rights and power, while the Pledgor or Party C shall not raise any objection to such appointment.

 

7.5                               The Pledgee shall be authorized to simultaneously or successively exercise any of its remedies. Before exercising its rights to auction or sell the equity hereunder, the Pledgee need not exercise other remedies first.

 

8.                                      Exercise of the Pledgee’s Right

 

8.1                               Before all contractual obligations are performed and guaranteed debts are fully repaid, the Pledgor shall not transfer its right or its equity in Party C without the Pledgee’s prior written consent.

 

8.2                               The Pledgee may issue a default notice to the Pledgor according to Article 7.3 in exercising the Pledgee’s Right.

 

8.3                               The Pledgee may compulsorily enforce the Pledgee’s Right while issuing a default notice according to Article 7.3 or any time after issuing such notice. The Pledgor shall cease to own any equity-related rights or interests once the Pledgee decides on the compulsory enforcement of the Pledgee’s Right.

 

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8.4                               The Pledgee shall have disposition rights of the pledged equity in exercising the Pledgee’s Right, all payments received from the Pledgee in exercising the pledge shall be disposed of in the following order:

 

(a)               Pay all fees incurred for disposition of the equity and the Pledgee’s exercising of its rights and power, including the lawyer fees and agent’s fees;

 

(b)               Pay taxes for disposing of the equity;

 

(c)                Repay guaranteed debts to the Pledgee.

 

If there is a surplus after the above payments are deducted, the balance (excluding interests) shall be paid to the Pledgor or held in escrow by a third party authorized to receive such money according to the relevant PRC Laws or a local notary office of the place where the Pledgee is based (all expenses thereby incurred shall be deducted from such balance).

 

8.5                               The Pledgor and Party C shall provide necessary assistance when the Pledgee disposes of the Pledgee’s Right as per this agreement, in order for the Pledgee to compulsorily enforce the Pledgee’s Right according to this agreement.

 

8.6                               All actual outlays, taxes and legal fees related to the equity pledge and the Pledgee’s exercising of rights hereunder shall be assumed by Party C, except for those borne by the Pledgee as specified by laws. The Pledgee shall be authorized to deduct such expenses from the money earned from its exercising of rights and power on an accrual basis.

 

8.7                               The amount of guaranteed debts independently confirmed by the Pledgee in exercising its Pledgee’s Right over the equity according to this agreement shall be deemed as conclusive evidence of guaranteed debts hereunder.

 

9.                                      Transfer

 

9.1                               The Pledgor shall not transfer its rights and obligations hereunder without the Pledgee’s prior written consent.

 

9.2                               The Pledgor and Party C agree that, on the premise of not violating current PRC Laws, the Pledgee may assign or transfer any of its rights exercisable under this agreement, transaction agreements and other security documents to a third party in any way and according to articles and requirements that it deems appropriate (including the rights to reassign) after notifying the Pledgor and Party C.

 

9.3                               This agreement shall be binding upon the Pledgor, Party C and their respective successors and authorized assignees (if any) and shall be effective for the Pledgee, its successors and assignees.

 

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9.4                               When the Pledgee transfers any or all of its rights and obligations under transaction agreements to its designated party (natural person/legal person) anytime, the assignee shall enjoy and perform the Pledgee’s Rights and obligations hereunder as if it were an original party of this agreement. The Pledgor and/or Party C shall sign pertinent agreements or other documents related to such transfer at the Pledgee’s request when the Pledgee transfers its rights and obligations under the Transaction Agreements.

 

9.5                               If the Pledgee changes according to the transaction agreements or this agreement, the Pledgor and Party C shall enter into a new equity pledge agreement with the new Pledgee according to the same articles and requirements of this agreement, and handle corresponding formalities for pledge registration.

 

9.6                               The Pledgor shall strictly obey provisions of this agreement and other agreements that either party of this agreement concludes with any party, including transaction agreements, and perform the obligations hereunder and under other agreements (including transaction agreements) without any act or omission which might affect effectiveness and enforceability of such obligations. Unless otherwise instructed by the Pledgee in writing, the Pledgor shall not exercise any remaining rights in the equity pledged hereunder.

 

10.                               Termination

 

This agreement shall be terminated when the pledge term expires, and the Pledgor shall cancel or terminate this agreement as soon as possible to the extent feasible and practicable, and rescind the equity pledge hereunder. Besides, the Pledgee and Party C shall document the release of the equity pledge on Party C’s Register of Shareholders and register such cancellation with the relevant registration authority. The reasonable expenses incurred for releasing the equity pledge shall be borne by the Pledgor and Party C. Articles 12, 13 and 19.5 shall survive the termination of this agreement.

 

11.                               Effectiveness and Term

 

This agreement shall take effect after it is signed by all Parties hereunder. This agreement shall be terminated after the Exclusive Business Cooperation Agreement is terminated, all service fees hereunder are paid, and Party C does not bear any obligation anymore under the Exclusive Business Cooperation Agreement. Besides, Party A shall cancel or rescind this agreement as early as possible within a reasonable time limit, and jointly handle formalities for registering pledge cancellation with Party B. In addition, this agreement shall be automatically terminated once Party C completes liquidation procedures according to PRC Laws or its business license is cancelled, whereas the termination of this agreement shall not affect any Party’s rights and obligations before the termination of this agreement.

 

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12.                               Commissions and Other Expenses

 

All expenses and actual outlays related to this agreement, including but not limited to lawyers’ fees, flat costs, stamp duties, any other taxes and fees, shall be borne by Party C. The Pledgor shall cause Party C to fully reimburse the Pledgee for such paid taxes and fees if the Pledgee is required to bear some related taxes and fees as stipulated by applicable laws.

 

13.                               Responsibilities for Non-disclosure

 

All Parties admit that all oral or written materials exchanged with respect to this agreement are confidential. All Parties are required to keep such materials confidential. Without the prior written consent of all other Parties, no party is allowed to disclose any related materials to a third party unless in following cases: (a) such materials have been known to the public (but not disclosed by the party receiving such materials); (b) the materials are required to be disclosed by applicable laws or rules of any securities exchange; or (c) any Party of this agreement discloses the materials to its legal adviser or financial adviser regarding the transactions specified hereunder, and such legal adviser or financial adviser is bound by the same confidentiality obligations as those under this article. The disclosure of any confidential information by staff or organizations hired by any Party shall be deemed as such Party’s disclosure of such confidential materials, and such Party shall assume legal responsibilities for violating this agreement. This article shall survive the termination of this agreement, notwithstanding the reason of termination.

 

14.                               Governing Laws and Dispute Resolution

 

14.1                        The signing, effectiveness, interpretation, performance, modification and    termination of this agreement as well as dispute resolution hereunder shall be governed by PRC laws which have been formally announced and available in public. For matters not regulated by such PRC Laws, customary international laws and principles shall prevail.

 

14.2                        In case that any dispute occurs in interpreting and performing this agreement, the Parties of this agreement shall firstly try to resolve it through negotiation in good faith. If the Parties fail to reach a consensus on such dispute resolution through negotiation within 30 days as required by any Party, any Party may submit such dispute to the China International Economic and Trade Arbitration Commission, which will resolve the dispute through arbitration according to current effective arbitration rules. The arbitration shall be performed in Shanghai in Chinese. The arbitration awards shall be final and binding upon all Parties. The arbitration tribunal may decide upon compensation with respect to Party C’s rights in the equity, assets or property, or compensate the Pledgee for the losses resulting from other Parties’ breach of this agreement, adjudicate compulsory remedies or order Party C to go bankrupt regarding related businesses or compulsory asset transfer. After arbitration awards take effects, any party shall be authorized to apply to a competent court for enforcing arbitration awards. If necessary, arbitration organizations shall have rights to firstly ask the breaching party to immediately stop its defaults before giving the final awards on disputes of all Parties concerned, or prohibit the breaching party from conducting acts which might aggravate the Pledgee’s losses. Courts of Hong Kong, Cayman Islands, China or other competent courts (including courts of the place where Party C lives, or courts of the place where Party C’s or the Pledgee’s main assets are) shall have rights to grant or execute awards of an arbitration tribunal. They shall have rights to adjudicate or enforce temporary relief with respect to Party C’s rights and interests in the equity or property. They shall also have rights to offer temporary relief to the party making a request for arbitration by giving awards or judgments before the tribunal court forms. For instance, the breaching party may be ordered by way of court judgment or arbitrated award to immediately suspend their breaches or conduct which might further aggravate the Pledgee’s losses.

 

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14.3                        When any dispute occurs in interpreting or performing this agreement, or any dispute is under arbitration, Parties of this agreement shall continue to exercise their rights and performing their respective obligations hereunder except for disputed matters.

 

14.4                        If any PRC law, rules or regulations are promulgated or revised after the date of signing this agreement, or the interpretation or applicability of such laws, rules or regulations changes, the following provisions shall apply: (a) if the revised laws or newly promulgated rules are more preferential for any party as compared to laws, rules or regulations in effect at the time this agreement was signed without imposing material adverse impacts upon other Parties, the Parties of this agreement shall promptly apply for obtaining benefits from such modifications or new rules and try their best to have the application approved; or (b) the original articles of this agreement shall prevail if such revised laws or newly enacted rules directly or indirectly impose material adverse impacts upon any party’s economic interests hereunder. The Parties shall seek to be exempted from these revised laws or new rules by all lawful means. If the adverse impacts on any party’s economic benefits cannot be alleviated according to this agreement, all Parties shall promptly negotiate with each other and make all necessary revisions to this agreement after the affected party notifies all other Parties and protect the affected Party’s economic interests.

 

15.                               Force Majeure

 

15.1        “Force majeure” means unforeseeable, unavoidable and irresistible events which make it impossible to perform this agreement in part or in whole. Such events include but are not limited to earthquake, typhoon, flood, wars, strike, riot, government actions, or changes to laws or rules or their application.

 

15.2                        In the event of a force majeure incident, Party’s obligations hereunder shall be naturally suspended for the delay caused by the incident, and the term for performing its obligations shall be extended accordingly. Such party shall not be subject to any punishment or assume any responsibility. In case of a force majeure incident, all Parties shall immediately negotiate with each other to look for a fair solution, and make every reasonable effort to minimize impacts of force majeure.

 

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16.                               Notices

 

16.1                        All notices and other communications which are issued as required or permitted by this agreement shall be delivered in person or sent to the Parties’ address and fax number listed in Appendix 1 through registered mail, postage prepaid, commercial express delivery services or fax. After notice is sent, an email shall be sent to confirm the delivery. The date of effective delivery of such notices shall be determined as follows:

 

16.1.1              The notices shall be deemed to have been delivered to the designated address on the date of sending or rejection if they are delivered in person, express delivery services or registered mail, postage prepaid.

 

16.1.2              The notices shall be deemed to have been delivered if they are successfully sent by fax (should be confirmed by the message automatically generated upon successful delivery).

 

16.2                        Any party may issue a notice to all other Parties according to this article to inform them of the address, fax and/or email address, which can be changed from time to time.

 

17.                               Severability

 

If one or more articles of this agreement are adjudicated to be ineffective, illegitimate or unenforceable in any aspect according to any laws, rules or regulations, validity, legitimacy or enforceability of other articles of this agreement shall not be affected or impaired in any aspect. All Parties shall strive to replace such ineffective, illegitimate or unenforceable articles with valid ones to the maximum extent permitted by laws and expected by Parties. The economic results from such invalid articles shall be as similar as possible to those from ineffective, illegal or unenforceable articles.

 

18.                               Appendixes

 

Appendixes hereunder shall be integral parts of this agreement.

 

19.                               Revision, Modification, Supplementation and Texts

 

19.1                        All revisions, modifications and supplementations of this agreement shall be in writing. They shall take effects after they are signed or stamped by all Parties hereunder and governmental registration procedures (if applicable) are completed.

 

19.2                        This agreement is made in 5 copies. Each party shall hold one copy and the rest shall be used for industrial and commercial registration. All copies shall have equal legal forces.

 

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20.                               Others

 

20.1                        Except for the written revisions, supplementations or modifications made after the date of signing, this agreement shall constitute the entire agreement concluded among all Parties hereunder regarding the subject matter of this agreement. It shall supersede all previous oral and written negotiations, statements and contracts concluded regarding the subject matter of this agreement.

 

20.2                        This agreement shall be binding upon and beneficial to all Parties’ respective successors and authorized assignees.

 

20.3                        Any party may waive its rights hereunder, whereas such waiver shall be in writing and approved by all Parties’ signatures. Any party’s waiver against another party’s breach of this agreement under certain circumstance shall not be deemed as its waiver against such party’s similar breaches under other circumstances.

 

20.4                        The subtitles of this agreement are only for the convenience of reading. They shall not be used for interpreting, describing or impacting definitions under this agreement in other aspects.

 

20.5                        All Parties agree to promptly sign documents and take further actions which are reasonably necessary or convenient to perform this agreement and achieve its purposes.

 

20.6                        To the extent there is no violation of other articles of the Transaction Agreements and this agreement, the Pledgor and Party C shall immediately take actions according to the Pledgee’s written instructions and reasonable requirements provided that the enactment or changes of any PRC laws, rules or regulations, or changes to the interpretation or applicability of such laws, rules or regulations, or changes to related registration procedures make the Pledgee believe that keeping this agreement or the Pledgee’s Right hereunder effective and/or disposing of the equity in ways designated under this agreement may become illegal or violate such laws, rules or regulations, in order to: (1) keep this agreement and the pledge hereunder effective; (2) for the convenience of disposition of the equity in ways specified hereunder; and/or (3) maintain the guarantees which have been or are to be established hereunder.

 

20.7                        This agreement is a legal document independent of transaction agreements and other security documents, the invalidity of which shall not affect all Parties’ rights or obligations hereunder. If transaction agreements or other security documents are announced to be invalid, the Pledgor shall still continue to perform the outstanding contractual obligations and/or repay outstanding guaranteed debts to the Pledgee. Besides, the equity hereunder shall still be used as collateral for pledging the contractual obligations and guaranteed debts until the Pledgor fully repays the guaranteed debts and performs all contractual obligations.

 

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In witness whereof, this Equity Pledge Agreement is signed by all Parties on the date and in the place indicated on the first page of this agreement.

 

 

	
Hangzhou   Yihan Technology Co., Ltd. (seal)
    	
 
    
	
[Company seal is   affixed]
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
/s/ Sijia CHEN
    	
 
    
	
Name: Sijia Chen
    	
 
    
	
Title: Legal   Representative
    	
 
    

 

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In witness whereof, this Equity Pledge Agreement is signed by all Parties on the date and in the place indicated on the first page of this agreement.

 

 

	
Hangzhou Xinghui Business Management Consulting   Co., Ltd. (seal)
    
	
[Company seal is   affixed]
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
/s/ Min FENG
    	
 
    
	
Name: Min FENG
    	
 
    
	
Title: Legal   Representative
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Min   FENG
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Signature: 
    	
/s/ Min FENG
    	
 
    

 

23

 

In witness whereof, this Equity Pledge Agreement is signed by all Parties on the date and in the place indicated on the first page of this agreement.

 

 

	
Hangzhou   Hanyi E-commerce Co., Ltd (seal)
    	
 
    
	
[Company seal is   affixed]
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
/s. Lei SUN
    	
 
    
	
Name: Lei SUN
    	
 
    
	
Title: Legal   Representative
    	
 
    

 

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Annex 1.

 

For the purpose of notices, all Parties’ addresses are specifically indicated as follows:

 

Party A:  Hangzhou Yihan Technology Co., Ltd

Address: Room 410, F4, Building A11, No. 9 Jiusheng Road, Jianggan District, Hangzhou

 

Party B:

Hangzhou Xinghui Business Management Consulting Co., Ltd

Address: Room 409, F4, Building A11, No. 9 Jiusheng Road, Jianggan District, Hangzhou

 

Feng Min

Address: #####

 

Party C: Hangzhou Hanyi E-commerce Co., Ltd

Address: Room 430, F4, Building A13, No. 9 Jiusheng Road, Jianggan District, Hangzhou

 

25Exhibit 10.3

 

Exclusive Call Option Agreement

 

The exclusive call option agreement (hereinafter referred to as “this agreement”) was signed in Hangzhou on October 4 2018.

 

Party A:            Hangzhou Yihan Technology Co., Ltd., a limited liability company established and existing in accordance with the laws of the People’s Republic of China, situated at Room 410, Floor 4, Building A11, Jiusheng Road 9, Jianggan District, Hangzhou.

 

Party B:            Hangzhou Xinghui Enterprise Management Consulting Co., Ltd., a limited liability company established and existing according to the laws of the People’s Republic of China, situated at the Room 409, Floor 4, Building A11, Jiusheng Road 9, Jianggan District, Hangzhou, Zhejiang Province

 

Feng Min, ID card No.: ##########; address: ##########

 

Party C:            Hangzhou Hanyi E-commerce Co., Ltd., a limited liability company established and existing in accordance with the laws of the People’s Republic of China, is situated at Room 430, Floor 4, Building A13, Jiusheng Road 9, Jianggan District, Hangzhou

 

In this Agreement, each of Party A, Party B and Party C shall be hereinafter referred to as a “Party” individually, and as the “Parties” collectively.

 

Whereas:

 

Party B holds 100% equity interests of Party C collectively and Party B is inclined to grant Party A the irrevocable and exclusive call option to purchase all or part of the shares and/or assets held by Party C.

 

This agreement is hereby concluded among Party A, Party B and Party C through the Parties’ friendly negotiations:

 

1. Sales and Purchase of Equity

 

1.1 Grant of Option

 

Party B hereby exclusively, irrevocably and unconditionally grants Party A an irrevocable and exclusive right (hereinafter referred to as “Exclusive Call Option”) to purchase, or designate one or more persons (each, a “Nominee”) to purchase equity interests in Party C then held by Party B once or at multiple times at any time in part or in whole at Party A’s sole and absolute discretion to the extent permitted by PRC laws (including any central or local legislation, any laws, regulations, rules, notifications, explanations or other binding documents issued by administrative or judicial department before or after signing of this agreement, hereinafter referred to as “PRC laws”) and at the price described in article 1.3 herein. Except for Party A and the Nominee(s), any third person shall should not enjoy the Exclusive Call Option or other rights relating to the equity interests of Party B. Party C hereby agrees that Party A grants Party B the Exclusive Call Option. The term “person” as used herein shall refer to individuals, corporations, partnerships, partners, enterprises, trusts or non-corporate organizations

 

 

1.2 Steps for the exercise of Exclusive Call Option

 

Subject to the provisions of the laws and regulations of China, Party A may exercise the Exclusive Call Option by issuing a written notice (hereinafter referred to as the “Share Call Option Notice”) to Party B, specifying: (a) Party A’s decision to exercise the Exclusive Call Option; (b) the name and address of the Nominee(s) if any; (c) the share (hereinafter referred to as “Purchased Shares”) of equity interests to be purchased by Party A and/or the Nominee from Party B as planned; and (d) the date for purchasing the Purchased Shares or the date for transfer of the purchased equity interest. After receiving the Share Call Option Notice, Party B shall transfer the purchased equity interest to Party A and/or nominee through the way specified in article 1.4 herein in full.

 

1.3 Purchase price and payment

 

The total purchase price (hereinafter referred to as “share purchase price”) for the purchased equity interest shall be the nominal price when Party A exercises the Exclusive Call Option. However, if the relevant governmental department or PRC laws require that the purchase price be different from the nominal price, then the purchase price shall be the lowest price meeting such requirement. Notwithstanding, in the event that it is permitted by the PRC Laws, the purchase price Party A pay to Party B shall be returned by Party B to Party A. After necessary tax is withheld and deducted for the share purchase price in accordance with PRC laws, the share purchase price shall be paid to Party B’s designated account within 7 days as of the date when the Purchased Shares is officially transferred to Party A.

 

1.4 Transfer of Purchased Shares

 

For each exercise of the Exclusive Call Option:

 

1.4.1 Party B shall cause Party C to promptly convene the shareholders’ meeting, at which the resolution that the Purchased Shares are transferred to Party A/and or the Nominee by Party B shall be approved;

 

1.4.2 Party B shall sign share transfer contract with Party A and/or (if applicable) the Nominee according to this agreement or equity interest option notice;

 

1.4.3 The relevant Parties shall execute all other necessary contracts, agreements or documents (including but not limited to the amendment to the articles of association of Party C), obtain all necessary internal approvals, authorizations, governmental licenses and permissions (including but not limited to Party C’s business license), take all necessary actions to transfer valid ownership of the Purchased Shares to Party A and/or the Nominee under the circumstance of no security interests and cause Party A and/or the Nominee to become the registered owner of the Purchased Shares. For the purpose of this article and this agreement, “security interests” shall include securities, mortgages, third party’s rights or interests, any stock option, acquisition right, right of first refusal, right to offset, ownership retention or other security arrangements. However, any security interest created herein and under equity pledge agreement shall not be included. “Equity Pledge Agreement” regulated in the clause and this agreement and herein shall refer to the Equity Pledge Agreement signed by and among Party A, Party B and Party C on the date hereof. In order to guarantee that Party C can fulfill the obligations under the “exclusive business cooperation agreement” (hereinafter referred to as “Business Cooperation Agreement”) signed by Party C and Party A on the date hereof, and “Power of Attorney” signed by all Parties on the date hereof and this agreement, Party B pledges its equity interests in Party C to Party A in accordance with the Equity Pledge Agreement.

 

 

2. Covenants

 

2.1 Covenants about Party B or Party C

 

Party B (as a shareholder of Party C) and Party C hereby covenant as follows:

 

2.1.1 Without the prior written consent of Party A, they shall not supplement, change or amend the articles of association of Party C in any form, increase or decrease its registered capital, or change its structure of registered capital or business scope in other manners, and take any actions to split, dissolve or change Party C’s company form;

 

2.1.2 They shall maintain Party C’s valid existence in accordance with good financial and business standards and practices, deal with other businesses and affairs prudently and effectively, and urge Party C to fulfill the obligations under the Business Cooperation Agreement;

 

2.1.3 Without the prior written consent of Party A, legitimate rights to any of Party B’s assets with a value of over RMB1 million (tangible and intangible), businesses or income shall not be sold, transferred, pledged or disposed in other ways as of the signing date hereof, and shall not be allowed to have encumbrance of any security interests placed on them;

 

2.1.4 After liquidation described in article 3.6, Party B shall pay any residual value based on non-bilateral way payment to Party A in full or shall request such payment to take place. Provided that such payment is forbidden according to PRC laws, Party B shall pay such income to Party A or a designee of Party A under the circumstance permissible according to PRC laws;

 

2.1.5 Without the prior written consent of Party A, there should be no assume, guarantee or debt except (i) the debts not caused through loan in the ordinary course of business; and (ii) the debts that have been disclosed to Party A for which written consent of Party A has been obtained;

 

2.1.6 Operation should be maintained for all of Party C’s businesses in the ordinary course of business to keep the asset value of Party C and to refrain from any action/omission that may adversely affect Party C’s operating status and asset value; and Party A’s board of directors is entitled to monitor Party C’s assets to evaluate whether there is adverse effect on the ownership  of Party C’s assets. In case that Party A’s board of directors believe that Party C’s business activities have an adverse effect on the value of Party C’s assets or the ownership of Party C’s assets, Party A may engage legal consultant or other professional staffs to deal with such issues.

 

2.1.7 Without the prior written consent of Party A, no request shall be made to Party C to sign any major contract except the contracts signed in the ordinary course of business (as far as this paragraph is concerned, a contract with a price exceeding RMB1 million shall be deemed as a major contract);

 

2.1.8 Without the prior written consent of Party A, no request shall be made to Party C to provide any person with any loan or credit;

 

2.1.9 At the requirement of Party A, information shall be provided about Party C’s operation and financial condition to Party A and/or Party A’s director or indirect shareholder and/or auditors entrusted by each party.

 

2.1.10 If requested by Party A, insurance shall be purchased and maintained in respect of Party C’s assets from the insurance carrier accepted by Party A, and the amount and type of insurance shall be identical to that usually covered by the companies with similar business and similar properties or assets;

 

 

2.1.11 Without the prior written consent of Party A, no requests or permit shall be made to Party C to merge, consolidate with, acquire or invest in any person;

 

2.1.12 Notification shall be made to Party A of any ongoing or potential litigation, arbitration or administrative proceedings relating to Party C’s assets, business or revenue, and all necessary measures according to Party A’s reasonable requirements shall be taken. If Party C faces insolvency, enters or plans to enter bankruptcy liquidation, dissolution procedure, decides to dissolve or be dissolved, stop operation or with business license or any business certificate revoked, is taken to the law for litigation or arbitration or Party B has disagreement with third party over any asset, Party B and Party C covenant that they will notify Party A of related detail in writing immediately when they become aware that such situation may occur, and will coordinate with Party A in taking all actions and signing necessary legal documents to maintain Party A’s rights herein;

 

2.1.13 To maintain the ownership by Party C of all of its assets, all necessary or appropriate documents shall be signed, all necessary or appropriate actions shall be taken, and all necessary or appropriate defenses against all claims shall be made;

 

2.1.14 Without the prior written consent of Party A, Party C shall not distribute dividends to Party C’s shareholders in any form, but upon Party A’s written request, Party C shall immediately distribute all distributable profits to Party C’s shareholders according to the amount and proportion designated by Party A;

 

2.1.15 At the request of Party A, appointment shall be made to any person designated by Party A as the director, supervisor, chief financial officer and/or and senior manager of Party C, and/or remove any incumbent director, supervisor, chief financial officer and/or senior manager of Party C;

 

2.1.16 In case that any shareholder of Party C or Party C fails to comply with its tax obligations under the applicable laws that prevents the exercise of the Exclusive Call Option by Party A, Party A is entitled to demand Party C or Party C’s shareholders to comply with the tax obligations, or demand Party C or Party C’s shareholder to pay the tax to Party A so that Party A can pay it on behalf of Party C; and

 

2.1.17 As for the covenant applicable to Party C in article 2.1 herein, Party B and Party C shall cause Party C’s subsidiaries to similarly obey the covenant under applicable situations as if the subsidiaries are acting as Party C and bound by the corresponding articles herein.

 

2.2 Covenants of Party B

 

Party B hereby covenants as follow:

 

2.2.1 Without the prior written consent of Party A, Party B shall not sell, transfer, mortgage or dispose of any legal or beneficial interests of Party C’s shares held by Party B, or set encumbrance of any security interests for it except the pledge for Party C’s equity set according to the Equity Pledge Agreement;

 

2.2.2 Party B shall not have any business or other behaviors that may cause Party C’s reputation to be adversely affected;

 

2.2.3 Party B shall take all measures to ensure Party C’s business licenses are legitimate, effective and renewed in accordance with the law;

 

 

2.2.4 Party B shall not sign documents or make covenants with others that contains conflicts of interest with agreements or other legal documents signed or being executed by Party C. In case that there is a conflict of interest, Party B shall immediately adopt measures to eliminate it as much as possible with Party A’s consent. In case that Party B refuses to take measures to eliminate the conflict of interest, Party A is entitled to execute the Exclusive Call Option herein;

 

2.2.5 Party B shall not ask Party C to distribute dividends or profits in other forms with respect to the Party C’s shares held by Party B, nor shall Party B propose or vote for Party C to distribute dividends or profits in other forms with respect to the Party C’s shares held by Party B in the shareholders’ meeting. In any case, if Party B receives any of Party C’s benefits, profit distribution or dividends, Party B shall forfeit such benefits, profit distribution and dividends to the extent allowed under PRC laws, and instantly transfer such benefits, profit distribution and dividends to Party A or a designee of Party A;

 

2.2.6 Party B shall cause Party C’s shareholders’ meeting and/board of directors (executive directors) not to approve the sales, transfer, pledge or disposal of any legal or beneficial interests in Party C’s shares held by Party B without the prior written consent of Party A, or set any encumbrance for any security interests except the pledge for Party C’s equity set according to the Equity Pledge Agreement.

 

2.2.7 Party B shall cause Party C’s shareholders’ meeting and/board of directors (executive directors) not to approve Party C’s merger, partnership, joint venture or union with any person or acquisition or investment in any person, or Party C’s splitting, modification of articles of association and registered capital of Party C and modification of business scope and corporation form.

 

2.2.8 Party B shall instantly notify Party C of any ongoing or possible litigation, arbitration or administrative proceedings relating to Party C’s assets, business or revenue, and take all necessary measures according to Party A’s reasonable requests. Party B shall instantly notify Party C of situations having major adverse effect on Party C’s survival, business, financial condition, assets or business reputation, and also take all actions according to Party A’s reasonable requests;

 

2.2.9 Party B shall cause Party C’s shareholders’ meeting and/or board of directors (executive directors) to vote for the transfer of Purchased Shares regulated herein and also take any other actions that may possibly be required by Party A.

 

2.2.10 Party A may request at any time that Party B immediately and unconditionally transfer Party C’s shares held by Party B to Party A or nominee according to the Exclusive Call Option herein, and Party B shall abandon the preemptive right of the equity transfer of Party C’s other shareholders (if any);

 

2.2.11 Party B shall obey the terms of this agreement and other contracts (including but not limited to the Equity Pledge Agreement and Business Cooperation Agreement) signed by Party B, Party C and Party A jointly or respectively, fulfill the obligations of this agreement and foregoing other contracts, and shall not have any actions that may adversely affect their effectiveness and compulsory execution. If Party B possesses any residual right for the equity herein or Equity Pledge Agreement or power of attorney in which Party A is the beneficiary, Party B shall not execute such rights unless instructed by Party A in writing;

 

2.2.12 Prior to Party C’s liquidation, if Party A or its nominee has paid the share purchase price to Party B, but related changes in the registration in authority has not completed, Party B shall pay the income from distribution of residual property of Party C’s shares held by Party B to Party A or its nominee freely at the time of or after dissolution of Party C. Under such circumstance, Party B should not claim any rights for related income of residual property distribution (unless under Party A’s instruction);

 

 

2.2.13 Party B agrees to unconditionally return the amount received from Party A for the transfer of the Purchased Shares transferred by Party B to the extent that it is permitted by the PRC Laws at that time; and

 

2.2.14 Ensure that Party C will validly exist and not be terminated, liquidated or dissolved.

 

3. Representations and Warranties

 

Party B and Party C hereby represent and warrant to Party A, on the date of this agreement and each date of transfer of the Purchased Shares, that:

 

3.1 They have the power, capacity and authority to execute and deliver this agreement and any share transfer contracts to which they are parties concerning the Purchased Shares to be transferred thereunder (hereinafter referred to as “Transfer Contract”), and to perform their obligations and ability under this agreement and any Transfer Contract. Party B and Party C agree to enter into the Transfer Contract that is substantially consistent with the terms of this agreement upon Party A’s exercise of the Exclusive Call Option. This agreement and the Transfer Contract constitute or will constitute their legal, valid and binding obligations for each party and shall be enforceable against them in accordance with the provisions thereof;

 

3.2 The execution and delivery of this agreement or any Transfer Contract and the obligations under this agreement or any Transfer Contract shall not: (i) cause any violation of any applicable PRC laws; (ii) be inconsistent with the articles of association, regulations or other organizational documents of Party C; (iii) cause the violation of any contracts or instruments to which they are a party or which are binding on them, or constitute any breach under any contracts or instruments to which they are a party or which are binding on them; (iv) cause any violation of any condition for the grant and/or continued effectiveness of any licenses or permits issued to either of them; or (v) cause the suspension or revocation of or imposition of additional conditions to any licenses or permits issued to either of them;

 

3.3 Party B has a good and transferable title to the shares held by Party B in Party C. Except for Party B’s Equity Pledge Agreement and Party B’s power of attorney, Party B has not placed any security interest on such equity interests;

 

3.4 Party C has a good and transferable title to the assets possessed by Party C, and has not placed any security interest on the aforementioned assets;

 

3.5 Party C does not have any outstanding debts, except for (i) debt incurred in the ordinary course of business; and (ii) debts disclosed to Party A and for which Party A’s written consent has been obtained;

 

3.6 If Party C is dissolved or liquidated according to the requirements of PRC laws, Party C shall sell all of Party C’s assets to Party A or other eligible subject designated by Party A at the minimum price permitted by PRC laws. Party C shall then exempt any payment obligations from Party A or eligible subject designated by Party A to the extent permitted by PRC laws. Any profits from such transaction shall be paid to Party A or eligible subject designated by Party A as part of the service fees under the Business Cooperation Agreement to the extent permitted by PRC laws.

 

3.7 Party C obeys all PRC laws and regulations applicable to the acquisition of assets;

 

 

3.8 There are no significant pending or threatened litigation, arbitration or administrative proceedings relating to Party C’s equity and assets or Party C;

 

3.9 In case of Party B’s death, incapacitation, bankruptcy or other circumstances which may affect shares of Party C’s held by Party B, Party B’s successor or the shareholder or transferee of Party C’s shares will be deemed as one of the Parties herein, and inherit and undertake all rights and obligations of Party B herein; and

 

3.10 Party C’s shares held by Party B’s natural person shareholder are not the common property of the natural person shareholder and his spouse. Party B’s spouse does not possess and cannot control Party C’s equity. Party B’s natural person shareholder shall manage Party C and vote without being affected by Party B’s spouse.

 

4. Effective Date

 

4.1 This agreement shall become effective on the signing date and will remain effective until all of Party C’s shares held by Party B are transferred to Party A and/or any other person designated by Party A (subject to the date when the change registration of industry and commerce is completed) in accordance with this agreement. During the effective period of this agreement, Party B and Party C shall not propose to terminate this agreement unilaterally. Notwithstanding the terms set out above, Party A is entitled to terminate this agreement unilaterally at any time and shall not bear any liability for breach of the contract for terminating this agreement unilaterally.

 

4.2 This agreement will be automatically terminated when Party C enters liquidation procedure or Party C’s business license is revoked according to PRC laws. However, the termination of this agreement does not affect the rights and obligations of each party before the termination of this agreement.

 

5. Liability for Breach of this Agreement

 

5.1 Unless otherwise specified in other articles herein, if one Party fails to fulfill certain obligations herein or violates this agreement in other ways (hereinafter referred to as “Default Party”), the other Party (hereinafter referred to as “Damaged Party”) can: (a) notify the Default Party of the nature and scope of the violation in writing and ask the Default Party to remediate at its own expense within a reasonable period of time (hereinafter referred to as “Remediation Period”); and if the Default Party fails to take remedial measures during the Remediation Period, the Damaged Party is entitled to ask the Default Party to undertake all liabilities and compensate all actual economic losses incurred by the Damaged Party as a result of the violation, including but not limited to the legal fees incurred in litigation and arbitration proceedings relating to the violation. The Default Party is also entitled to ask the Default Party to perform its contractual obligations and request the court or the relevant arbitration institution to issue an order of specific performance by the Default Party; (b) terminate this agreement and ask the Default Party to undertake all liabilities and compensate all damages caused by the breach of contract; or (c) place the pledged shares on discount, auction or sales according to the Equity Pledge Agreement, be entitled to compensation priority in the amount of discount, auction and sales, and ask the Default Party to undertake all losses hereof. While exercising the foregoing remedial right, the Damaged Party is entitled to other remedial rights regulated herein and under the relevant laws and regulations.

 

5.2 All Parties agree and confirm that, subject to the compulsory requirements of PRC laws, if Party B or Party C is the Default Party, the Damaged Party is entitled to terminate this agreement unilaterally and ask the Default Party for compensation. However, if Party A is the Default Party, the Damaged Party shall exempt Party A’s obligation of compensating the losses, and unless the law states otherwise, the Damaged Party may not terminate this agreement under any circumstance.

 

 

6. Governing Laws and Dispute Settlement

 

6.1 Governing laws

 

The signing, validation, interpretation, implementation, modification and termination of this agreement and settlement of disputes herein shall be governed by officially released and publicized PRC laws. For matters that are not addressed by PRC laws that are officially announced and publicly available, customary international law and principles of international law shall apply.

 

6.2 Dispute settlement

 

Any disputes arising from the interpretation and implementation of this agreement shall be firstly solved through the Parties’ friendly negotiations. In case that the consensus on settlement of such disputes is not reached within 30 days after any Party asks other Parties to reach solution through friendly negotiations, any Party can submit the disputes to Shanghai International Economic Trade Arbitration Committee, which gives verdict according to the prevailing arbitration rule at that time. The arbitration shall take place in Shanghai and language for arbitration shall be Chinese. The arbitration award is final and binding for each party. The arbitral tribunal can order Party A be compensated with Party C’s equity interests, assets or property rights & interests due to the breach of contract of other Parties herein, or reach judgment of compulsory remediation through transfer of related business or assets or order Party C to declare bankruptcy. After the arbitration award goes into effect, any Party is entitled to ask the relevant court to execute the arbitration award. If necessary, the arbitral institution is entitled to order the Default Party to cease the breach of this agreement or not have behaviors that would further increase losses to Party A before making the final verdict. The courts in Hong Kong, Cayman Islands, China or other places with right of jurisdiction (the court in the place of Party C, or the court in the place of main asset of Party C or Party A shall be deemed as the court with right of jurisdiction) similarly are entitled to confer or execute the verdict of the arbitral tribunal and is also entitled to make judgment or execute temporary relief for Party C’s equity or property interests, and give verdict or judgment of providing certain temporary relief for the party instigating the arbitration before the establishment of arbitral tribunal, such as giving verdict or judgment of ordering the Default Party to cease illegal behaviors or not have behaviors of further increasing losses to Party A.

 

6.3 In the arbitration for any disputes arising from the interpretation and implementation of this agreement, all Parties herein shall continue to execute other rights and obligations herein except the matters herein in dispute.

 

6.4 After execution of this Agreement, if there are any issuance or alteration of any PRC laws, rules or regulations or if there are any change in interpretation or application of such laws, rules or regulations as of the signing date, the following agreement shall be applicable: to the extent of permission of PRC laws, (a) in case that the alteration of laws or newly issued regulations are more preferential for any Party compared to the relevant laws, decrees, orders or regulations that are prevailing on the signing date hereof, each party shall actively and immediately apply for obtaining the benefits brought by the modification or new regulations and try their best to obtain the approval for the application; or (b) in case that any Party’s economic benefit is directly or indirectly adversely influenced due to the alteration of foregoing laws or newly issued regulations, this agreement shall be continuously executed as scheduled while all Parties shall obtain the exemption from the observation of alteration or regulations through legitimate manners. If this agreement cannot be reached due to the decrease in economic benefit of any Party, all Parties shall immediately negotiate and make all necessary alterations to this agreement after receiving the notification of the affected Party to safeguard the economic benefit of the affected Party.

 

 

7 Taxes and Expenses

 

Each Party shall pay all transfer and registration taxes, expenses and fees incurred thereby or levied thereon in accordance with the PRC laws in connection with the preparation and execution of this agreement and the Transfer Contract, as well as the consummation of the transactions contemplated under this agreement and the Transfer Contract.

 

8 Notices

 

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

 

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

 

8.1.2 Notices given by facsimile transmission shall be deemed effectively delivered on the date of successful transmission (subject to transmission confirmation information automatically generated).

 

8.2 Any Party can change the receiving address, fax and/or e-mail address when sending out notices to other parties according to the clause herein.

 

9. Confidentiality

 

All Parties acknowledge that any oral or written information exchanged between the {arties in connection with this agreement is regarded as confidential information. Each party shall maintain confidentiality of all such confidential information, and without written consent of other parties, each party shall not disclose any relevant confidential information to any third party, except for following situations: (a) such information (not disclosed to the public by the party receiving the information) are known to the public; (b) the information is disclosed according to the requirements or regulations of applicable laws or any stock exchange; or (c) the information that any Party needs to disclose to the Party’s legal or financial consultant to fulfill the transaction regulated herein and the legal or financial consultant is also under the binding force of the confidentiality obligation in this article. Any confidential information disclosed by the staff of or institutions engaged by any Party shall be regarded as being disclosed by such party, and the party shall undertake legal responsibility for violating this agreement. If for any reason this agreement is terminated, this article shall still be valid.

 

10 Further Warranties

 

Each party agrees to promptly execute documents that are reasonably required for the implementation of the clauses and purposes of this agreement and take further actions that are reasonably required for the implementation of the clauses and purposes of this agreement.

 

11. Force Majeure

 

11.1 “Force majeure” refers to events that cannot be foreseen, avoided and overcome so that this agreement cannot be executed in part or full. Such events include but are not limited to earthquake, typhoon, flood, water disaster, war, strike, turmoil, governmental behavior, changes to legal regulations or their application.

 

 

11.2 In case of the occurrence of force majeure event, a Party ‘s obligation that is being affected by force majeure shall be automatically suspended during the delay caused by force majeure, and the party’s period of implementation of this agreement shall be automatically prolonged. The prolonged period is the period of the suspension, and the party shall not assume responsibility and suffer from punishment for it. In case of force majeure, all Parties shall instantly negotiate with each other to seek a fair solution and put forth reasonable efforts to minimize the effect of force majeure.

 

12 Others

 

12.1 Revision, alteration and supplementation

 

Revision, alteration and supplementation of this agreement shall be made through written agreement signed by each party. For example, if Nasdaq or other regulatory institutions proposes any revisions to this agreement, or revisions are required according to the Nasdaq listing rules or related regulations, the Parties shall revise this agreement accordingly.

 

12.2 Entire Agreement

 

Except for any revision, alteration and supplementation made after the execution of this agreement, this agreement shall constitute the entire agreement reached by and among the Parties hereto with respect to the subject matter hereof, and replace all prior oral and written consultations, representations and contracts reached with respect to the subject matter of this agreement.

 

12.3 Titles

 

The titles of this agreement are for convenience of reading only and shall not be used to interpret, explain or influence the meanings regulated herein.

 

12.4 Text

 

This agreement is made in four copies with each party holding one copy, all having the same legal effect.

 

12.5 Severability

 

In case one or several of the provisions of this agreement are found to be invalid, illegal or unenforceable in any aspect according to any laws or regulations, the validity, legality or enforceability of the remaining provisions of this agreement shall not be affected or compromised in any respect. All Parties shall strive for replacing such invalid, illegal or unenforceable provisions with effective ones to the extent permitted by law and in accordance with the expectations of the Parties, and the economic effect of such effective provisions shall be as close as possible to the that of those invalid, illegal or unenforceable provisions.

 

12.6 Successors

 

This agreement shall be binding on and shall be beneficial to the respective successors and the permitted transferee of each party .

 

12.7 Survival

 

12.7.1 Any obligations that occur or that are due as a result of this agreement before the expiration or termination of this agreement shall survive after the expiration or termination of this agreement thereof.

 

12.7.2 The provisions in articles 6, 8, 9 and 12.7 shall survive after termination of this agreement.

 

 

12.8 Waivers

 

Any Party may waive the terms and conditions of this agreement, but such waiver must be made in writing and signed by each party. Any waiver made by a Party in respect to another Party’s violation of this agreement shall not be regarded as waiver for other similar violations of this agreement under other situations.

 

12.9 Abidance of laws and regulations

 

Each party shall abide by and ensure their operation is in full compliance with all PRC laws and regulations that are officially released and can be obtained publicly.

 

12.10 Transfer of rights

 

Without prior written permission of Party A, Party C and/or Party B should not transfer any rights/and or obligations herein to any third party. Party B and Party C hereby agree that Party A is entitled to transfer any of Party A’s rights and/or obligations herein to any third party after notifying Party B and Party C in writing. Party B and Party C shall sign a supplementary agreement with the transferee or a new agreement containing substantially the same content herein with the transferee.

 

This agreement is signed by the following Parties herein in the place and on the date specified herein.

 

	
Hangzhou  Yihan Technology Co., Ltd.   (seal)
    	
 
    
	
[Company seal is affixed]
    	
 
    
	
 
    	
 
    
	
Signed by:
    	
/s/ Sijia CHEN
    	
 
    
	
Name: Sijia CHEN
    	
 
    
	
Position: Legal representative
    	
 
    
			

 

 

(No text below, the signing page of “Exclusive Call Option Agreement”)

 

Hangzhou Xinghui Enterprise Management Consulting Co., Ltd. (seal)

[Company seal is affixed]

 

	
Signed by:
    	
/s/ Min FENG
    	
 
    
	
Name: Min FENG
    	
 
    
	
Position: Legal representative
    	
 
    
	
 
    	
 
    
	
Feng   Min
    	
 
    
	
Signed by:
    	
/s/ Min FENG
    	
 
    

 

 

Hangzhou Hanyi E-commerce Co., Ltd. (seal)

[Company seal is affixed]

 

	
Signed by:
    	
/s/ Lei SUN
    	
 
    
	
Name: Lei SUN
    	
 
    
	
Position: Legal representative
    	
 
    

 

 

Attachment I

 

For the purpose of notification, each party’s address is as below:

 

Party A: Hangzhou Yihan Technology Co., Ltd.

Address: Room 410, Floor 4, Building A11, Jiusheng Road 9, Jianggan District, Hangzhou

 

Party B:

Hangzhou Xinghui Enterprise Management Consulting Co., Ltd.

Address: Room 409, Floor 4, Building A11, Jiusheng Road 9, Jianggan District, Hangzhou, Zhejiang Province

 

Feng Min

Address: ##########

 

Party C: Hangzhou Hanyi E-commerce Co., Ltd.

Address: Room 430, Floor 4, Building A13, Jiusheng Road 9, Jianggan District, Hangzhou

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