Document:

EX-4.15

Exhibit 4.15

SECURITY AGREEMENT

DATED 13 FEBRUARY 2009

BETWEEN

CYBER LIGHTING HOLDING COMPANY LIMITED

as Chargor

and

GOLD SUN DAY LIMITED

as Chargee

 

 

CONTENTS

	 	 	 	 	 	 	 
	Clause	 	 	 	Page
	 
	 	 	 	 	 	 
	1.

	 	Interpretation
	 	 	3	 
	2.

	 	Creation of Security
	 	 	5	 
	3.

	 	Representations and Warranties — general
	 	 	8	 
	4.

	 	Restrictions on dealings
	 	 	11	 
	5.

	 	Land
	 	 	11	 
	6.

	 	Investments
	 	 	15	 
	7.

	 	Intellectual Property
	 	 	18	 
	8.

	 	Accounts
	 	 	19	 
	9.

	 	Relevant contracts
	 	 	21	 
	10.

	 	When Security becomes enforceable
	 	 	22	 
	11.

	 	Enforcement of Security
	 	 	22	 
	12.

	 	Receiver
	 	 	23	 
	13.

	 	Powers of Receiver
	 	 	24	 
	14.

	 	Application of proceeds
	 	 	26	 
	15.

	 	Expenses and indemnity
	 	 	27	 
	16.

	 	Delegation
	 	 	27	 
	17.

	 	Further assurances
	 	 	27	 
	18.

	 	Power of attorney
	 	 	28	 
	19.

	 	Preservation of Security
	 	 	28	 
	20.

	 	Miscellaneous
	 	 	30	 
	21.

	 	Release
	 	 	31	 
	22.

	 	Severability
	 	 	31	 
	23.

	 	Notices
	 	 	31	 
	24.

	 	Language
	 	 	32	 
	25.

	 	Amendments and Waivers
	 	 	32	 
	26.

	 	Set-off
	 	 	33	 
	27.

	 	Pro-Rata Sharing
	 	 	33	 
	28.

	 	Changes to the Parties
	 	 	33	 
	29.

	 	Counterparts
	 	 	33	 
	30.

	 	Governing Law
	 	 	33	 
	31.

	 	Enforcement
	 	 	33	 

	 	 	 	 	 	 	 	 	 
	Schedules	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	1.

	 	Security Assets
	 	 	35	 	 	 
	2.

	 	Form of resignation letter
	 	 	36	 	 	 
	3.

	 	Form of written resolution of directors
	 	 	37	 	 	 
	4.

	 	Form of authorisation letter
	 	 	38	 	 	 
	5.

	 	Forms of letter for Account Bank
	 	 	39	 	 	 
	6.

	 	Forms of letter for Relevant Contracts
	 	 	42	 	 	 
	7.

	 	Accession Deed
	 	 	45	 	 	 
	 
	 	 	 	 	 	 	 	 
	Signatories	 	 	46	 	 	 

 

 

THIS DEED is dated 13 February 2009 between:

	(1)	 	CYBER LIGHTING HOLDING COMPANY LIMITED, a company incorporated under the laws of Hong Kong
with its registered office at 50th Floor, Bank of China Tower, 1 Garden Road, Central, Hong
Kong and registration number 1247919 (the Chargor); and
	 
	(2)	 	GOLD SUN DAY LIMITED as security agent for itself and any other Finance Party appointing it
as security agent from time to time (the Chargee).

BACKGROUND:

	(A)	 	The Chargor enters into this Deed in connection with the Credit Agreement and the Guarantee
and Undertaking (as defined below).
	 
	(B)	 	The Chargor has also executed a Guarantee Acknowledgment in respect of its obligations under
the Guarantee and Undertaking.

IT IS AGREED as follows:

	1.	 	INTERPRETATION
	 
	1.1	 	Definitions

	 	 	In this Deed:
	 
	 	 	Accession Deed means a deed by which a new Finance Party becomes a party to this Deed,
substantially in the form of Schedule 7 (Form of Accession Deed), with such amendments as
the Chargee may approve or reasonably require.
	 
	 	 	Account Bank means, in relation to a Security Account, the bank with which that Security
Account is maintained.
	 
	 	 	Event of Default has the meaning given to that term under the Finance Documents.
	 
	 	 	Finance Document has the meaning given to that term in the Guarantee and Undertaking and
includes an Accession Deed.
	 
	 	 	Guarantee and Undertaking means the guarantee and undertaking dated 24 January 2009 between,
among others, Yingli Green Energy Holding Company Limited as guarantor and the Chargee.
	 
	 	 	Party means a party to this Deed.
	 
	 	 	Property Ordinance means the Conveyancing and Property Ordinance (Cap. 219 of the Laws of
Hong Kong).
	 
	 	 	Receiver means a receiver and manager or (if the Chargee so specifies in the relevant
appointment) a receiver, in either case, appointed under this Deed.
	 
	 	 	Secured Liabilities means all present and future obligations and Liabilities (whether actual
or contingent and whether owed jointly or severally or in any other capacity whatsoever) of
each Obligor to any Finance Party under each Finance Document, except for any obligation
which,

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	 	 	if it were so included, would result in this Deed contravening section 47A of the Companies
Ordinance (Cap. 32 of the Laws of Hong Kong).
	 
	 	 	Secured Loan Liabilities means all present and future obligations and Liabilities (whether
actual or contingent and whether owed jointly or severally or in any other capacity
whatsoever) of each Obligor to a Finance Party (other than a Warrantholder) under each
Finance Document (other than a Warrant Document).
	 
	 	 	Security Account means all accounts maintained in the name of the Chargor and identified as
a Security Account and includes, as at the date of this Deed, the accounts specified in
Schedule 1 (Security Assets) under the heading Security Accounts and includes:

	 	(a)	 	if there is a change of Account Bank, any account into which all or part of a
credit balance from a Security Account is transferred; and
	 
	 	(b)	 	any account which is a successor to a Security Account on any re-numbering or
re-designation of accounts and any account into which all or any part of a credit
balance of a Security Account is transferred for investment or other administrative
purposes.

	 	 	Security Assets means all assets of the Chargor the subject of any security created by this
Deed.
	 
	 	 	Security Period means the period beginning on the date of this Deed and ending on the date
on which the Chargee is satisfied that all the Secured Loan Liabilities have been
unconditionally and irrevocably paid and discharged in full.
	 
	1.2	 	Construction

	(a)	 	Capitalised terms defined in the Guarantee and Undertaking have, unless expressly defined in
this Deed, the same meaning in this Deed.

	(b)	 	The provisions of clause 1.2 (Construction) of the Guarantee and Undertaking apply to this
Deed as though they were set out in full in this Deed, except that references to the Guarantee
and Undertaking will be construed as references to this Deed.
	 
	(c)	 	(i) The term Finance Document includes all amendments and supplements including supplements
providing for further advances; and
	 
		 	(ii) the term this Security means any security created by this Deed.
	 
	(d)	 	Any covenant of the Chargor under this Deed (other than a payment obligation) remains in
force during the Security Period.
	 
	(e)	 	In the context of the rights, powers, privileges, discretions and immunities conferred on the
Chargee or a Receiver, references to charge or mortgage in any provision of the Property
Ordinance shall, for the purposes of this Deed, be deemed to be references to this Security
and references to mortgaged land in any provision of the Property Ordinance shall, for the
purposes of this Deed, be deemed to be references to the Security Assets.
	 
	(f)	 	An Event of Default is outstanding if it has occurred and has not been waived by the Chargee
in writing.
	 
	(g)	 	If the Chargee considers that an amount paid to a Finance Party under a Finance Document is
reasonably likely to be avoided or otherwise set aside on the liquidation or provisional

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	 	 	supervision of the payer or otherwise, then that amount will not be considered to have been
unconditionally and irrevocably paid for the purposes of this Deed.
	 
	(h)	 	Unless the context otherwise requires, a reference to a Security Asset includes the proceeds
of sale of that Security Asset.

	2.	 	CREATION OF SECURITY
	 
	2.1	 	General

	(a)	 	All the security created under this Deed:

	 	(i)	 	is created in favour of the Chargee for itself and as agent and trustee on
trust for the Finance Parties;
	 
	 	(ii)	 	is created over present and future assets of the Chargor;
	 
	 	(iii)	 	is created by the Chargor as the beneficial owner of its assets; and
	 
	 	(iv)	 	is security for the payment and discharge of all the Secured Liabilities.

	(b)	 	If the rights of the Chargor under a document cannot be secured without the consent of a
party to that document:

	 	(i)	 	the Chargor must notify the Chargee promptly;
	 
	 	(ii)	 	this Security will secure all amounts which the Chargor may receive, or has
received, under that document but exclude the document itself; and
	 
	 	(iii)	 	unless the Chargee otherwise requires, the Chargor must use reasonable
endeavours to obtain the consent of the relevant party to that document being secured
under this Deed.

	(c)	 	The Chargee holds the benefit of this Deed on trust for itself and the Finance Parties.

	2.2	 	Land

	(a)	 	The Chargor charges:

	 	(i)	 	by way of a first legal charge all estates or interests in any real property
now owned by it; this includes the real property (if any) specified in Schedule 1
(Security Assets) under its name under the heading Real Property; and
	 
	 	(ii)	 	(to the extent that they are not the subject of a legal charge under
sub-paragraph (i) above) by way of first fixed charge all estates or interests in any
real property.

	(b)	 	A reference in this Subclause to a charge of any real property includes:

	 	(i)	 	all buildings, fixtures, fittings and fixed plant and machinery on that
property; and
	 
	 	(ii)	 	the benefit of any covenants for title given or entered into by any predecessor
in title of the Chargor in respect of that property or any moneys paid or payable in
respect of those covenants.

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	2.3	 	Investments
	 
	(a)	 	The Chargor:

	 	(i)	 	mortgages by way of a first equitable mortgage all shares or equity interests
in any member of the Group (other than itself and Opco) owned by it or held by any
nominee on its behalf; and
	 
	 	(ii)	 	charges (to the extent that they are not the subject of a mortgage under
sub-paragraph (i) above) by way of a first fixed charge its interest in all shares,
stocks, debentures, bonds or other securities and investments owned by it or held by
any nominee on its behalf.

	(b)	 	A reference in this Subclause to a mortgage or charge of any stock, share, debenture, bond or
other security includes:

	 	(i)	 	any dividend, interest or distribution paid or payable in relation to it;
	 
	 	(ii)	 	any right, money or property accruing or offered at any time in relation to it
by way of redemption, substitution, exchange, bonus or preference, under option rights
or otherwise;
	 
	 	(iii)	 	any right against any clearance system; and
	 
	 	(iv)	 	any right under any securities account, custodian or other agreement in
relation to it.

	2.4	 	Plant and machinery
	 
	 	 	The Chargor charges by way of a first fixed charge all plant and machinery owned by it and
its interest in any plant or machinery in its possession.
	 
	2.5	 	Credit balances
	 
	 	 	The Chargor charges by way of a first fixed charge all of its rights in respect of any
amount standing to the credit of any account (including any account contemplated by this
Deed) it has with any person and the debt represented by it.
	 
	2.6	 	Book debts etc.
	 
	 	 	The Chargor charges by way of a first fixed charge:

	 	(a)	 	all of its book and other debts;
	 
	 	(b)	 	all other moneys due and owing to it; and
	 
	 	(c)	 	the benefit of all rights, securities or guarantees of any nature enjoyed or
held by it in relation to any item under paragraph (a) or (b) above.

	2.7	 	Insurances
	 
	 	 	The Chargor assigns absolutely, subject to a proviso for re-assignment on redemption, all of
its rights in respect of any contract or policy of insurance taken out by it or on its
behalf or in which it has an interest.

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	2.8	 	Other contracts
	 
	 	 	The Chargor assigns absolutely, subject to a proviso for re-assignment on redemption, all of
its rights in respect of:

	 	(a)	 	any agreement to which it is a party except to the extent that it is subject to
any fixed security created under any other term of this Clause; this includes the
agreements (if any) specified in Schedule 1 (Security Assets) under its name under the
heading Relevant Contracts;
	 
	 	(b)	 	any letter of credit issued in its favour; and
	 
	 	(c)	 	any bill of exchange or other negotiable instrument held by it.

	2.9	 	Intellectual property
	 
	 	 	The Chargor charges by way of a first fixed charge, all of its rights in respect of:

	 	(a)	 	any know-how, patent, trade mark, service mark, design, business name,
topographical or similar right; this includes the patents and trademarks (if any)
specified in Schedule 1 (Security Assets) under its name under the heading Specific
Intellectual Property Rights;
	 
	 	(b)	 	any copyright or other intellectual property monopoly right; or
	 
	 	(c)	 	any interest (including by way of licence) in any of the above,

	 	 	in each case whether registered or not and including all applications for the same.

	2.10	 	Miscellaneous
	 
	 	 	The Chargor charges by way of first fixed charge:

	 	(a)	 	any beneficial interest, claim or entitlement it has in any pension fund;
	 
	 	(b)	 	its goodwill;
	 
	 	(c)	 	the benefit of any authorization (statutory or otherwise) held in connection
with its use of any Security Asset;
	 
	 	(d)	 	the right to recover and receive compensation which may be payable to it in
respect of any authorization referred to in paragraph (c) above; and
	 
	 	(e)	 	its uncalled capital.

	2.11	 	Floating charge
	 
	(a)	 	The Chargor charges by way of a first floating charge all its assets not at any time
otherwise effectively mortgaged, charged or assigned by way of fixed mortgage, charge or
assignment under this Clause.
	 
	(b)	 	The Chargee may by notice to the Chargor convert the floating charge created by the Chargor
under this Deed into a fixed charge as regards any of the Chargor’s assets specified in that
notice, if:

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	 	(i)	 	an Event of Default is outstanding;
	 
	 	(ii)	 	the Chargee considers those assets to be in danger of being seized or sold
under any form of distress, attachment, execution or other legal process or to be
otherwise in jeopardy;
	 
	 	(iii)	 	the Chargor fails to comply, or takes or threatens to take any action which,
in the reasonable opinion of the Chargee, is likely to result in the Chargor failing to
comply with its obligations under Clause 4 (Restrictions on dealings),

	 	 	and upon issue of such notice by the Chargee to the Chargor in respect of any asset of the
Chargor, the floating charge over that asset shall immediately crystallise and become a
fixed charge.

	(c)	 	The floating charge created under this Deed will (in addition to the circumstances in which
the same will occur under general law) automatically convert into a fixed charge over all of
the Chargor’s assets on the convening of any meeting of the members of the Chargor to consider
a resolution to wind up the Chargor (or not to wind up the Chargor).
	 
	(d)	 	The giving by the Chargee of a notice under paragraph (b) above in relation to any asset of
the Chargor will not be construed as a waiver or abandonment of the Chargee’s rights to give
any other notice in respect of any other asset or of any other right of any other Finance
Party under this Deed or any other Finance Document.
	 
	3.	 	REPRESENTATIONS AND WARRANTIES — GENERAL
	 
	3.1	 	Representations and warranties
	 
	 	 	The Chargor makes the representations and warranties set out in this Clause to each Finance
Party.

	3.2	 	Status
	 
	 	 	It is a limited liability company, duly incorporated and validly existing under the laws of
the jurisdiction of its incorporation.

	3.3	 	Powers and authorisations
	 
	 	 	It has the power to enter into and perform, and has taken all necessary action to authorise
the entry into and performance of, this Deed and the transactions contemplated by this Deed.
	 
	3.4	 	Legal validity
	 
	 	 	Subject to any general principles of law limiting its obligations and referred to in any
legal opinion required under the Finance Documents, this Deed:

	 	(a)	 	constitutes its legally valid, binding and enforceable obligation; and
	 
	 	(b)	 	is in the proper form for its enforcement in the jurisdiction of its
incorporation.

	3.5	 	Non-conflict
	 
	 	 	The entry into and performance by it of, and the transactions contemplated by, this Deed do
not and will not conflict with:

8

 

	 	(a)	 	any law or regulation applicable to it; or
	 
	 	(b)	 	its or any of its Subsidiaries’ constitutional documents; or
	 
	 	(c)	 	any document which is binding upon it or any of its Subsidiaries’ or any of its
or any of its Subsidiaries’ assets.

	3.6	 	No default
	 
	(a)	 	No Event of Default is outstanding or will result from the entry into of, or the performance
of any transaction contemplated by, this Deed.
	 
	(b)	 	No other event or circumstance is outstanding which constitutes a default under any document
which is binding on it or any of its Subsidiaries to an extent or in a manner which has or is
reasonably likely to have a Material Adverse Effect.
	 
	3.7	 	Authorisations
	 
	 	 	Subject to the completion of the filing of particulars of the Security Interests created
under this Deed and the registration of this Deed with the Hong Kong Companies Registry, all
authorisations required by it in connection with the entry into, performance, validity and
enforceability of, and the transactions contemplated by, this Deed have been obtained or
effected (as appropriate) and are in full force and effect.
	 
	3.8	 	Stamp duties
	 
	 	 	No stamp or registration duty or similar Tax or charge is payable in its jurisdiction of
incorporation in respect of this Deed.
	 
	3.9	 	Immunity
	 
	(a)	 	The entry into by it of this Deed constitutes, and the exercise by it of its rights and
performance of its obligations under this Deed will constitute, private and commercial acts
performed for private and commercial purposes.
	 
	(b)	 	It will not be entitled to claim immunity from suit, execution, attachment or other legal
process in any proceedings taken in its jurisdiction of incorporation in relation to this
Deed.
	 
	3.10	 	No adverse consequences
	 
	(a)	 	It is not necessary under the laws of its jurisdiction of incorporation:

	 	(i)	 	in order to enable any Finance Party to enforce its rights under this Deed; or
	 
	 	(ii)	 	by reason of the entry into of this Deed or the performance by it of its
obligations under this Deed,

	 	 	that any Finance Party should be licensed, qualified or otherwise entitled to carry on
business in its jurisdiction of incorporation.

	(b)	 	No Finance Party is nor will be deemed to be resident, domiciled or carrying on business in
its jurisdiction of incorporation by reason only of the entry into, performance and/or
enforcement of this Deed.

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	3.11	 	Jurisdiction/governing law
	 
	(a)	 	In this Subclause:
	 
	 	 	Relevant Jurisdiction means, in relation to the Chargor:

	 	(i)	 	its jurisdiction of incorporation;
	 
	 	(ii)	 	any jurisdiction where any asset subject to or intended to be subject to this
Deed is situated;
	 
	 	(iii)	 	any jurisdiction where it conducts its business; and
	 
	 	(iv)	 	the jurisdiction whose laws govern the perfection of this Deed.

	(b)	 	Subject to any general principles of law limiting its obligations and referred to in any
legal opinion required under the Finance Documents, its:

	 	(i)	 	irrevocable submission under this Deed to the jurisdiction of the courts of
Hong Kong;
	 
	 	(ii)	 	agreement that this Deed is governed by Hong Kong law; and
	 
	 	(iii)	 	agreement not to claim any immunity to which it or its assets may be entitled,

	 	 	are legal, valid and binding under the laws of its Relevant Jurisdiction.

	(c)	 	Subject to any general principles of law limiting its obligations and referred to in any
legal opinion required under the Finance Documents, the choice of governing law in this Deed
will be recognised and enforced in its Relevant Jurisdiction.
	 
	(d)	 	Subject to any general principles of law limiting its obligations and referred to in any
legal opinion required under the Finance Documents, any judgment obtained in Hong Kong will be
recognised and be enforceable by the courts of its Relevant Jurisdiction.
	 
	3.12	 	Nature of security
	 
	 	 	This Deed creates those Security Interests it purports to create and is not liable to be
amended or otherwise set aside on its liquidation or provisional supervision or otherwise.
	 
	3.13	 	Times for making representations and warranties
	 
	(a)	 	The representations and warranties set out in this Deed (including in this Clause) are made
on the date of this Deed.
	 
	(b)	 	Unless a representation and warranty is expressed to be given at a specific date, each
representation and warranty under this Deed (other than the representations and warranties set
out in Clause 3.7 (Stamp duties) and Clause 3.9 (No adverse consequences) is deemed to be
repeated by the Chargor on each date during the Security Period.
	 
	(c)	 	When a representation and warranty is repeated, it is applied to the circumstances existing
at the time of repetition.

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	4.	 	RESTRICTIONS ON DEALINGS
	 
	 	 	The Chargor must not:

	 	(a)	 	create or permit to subsist any Security Interest on any Security Asset; or
	 
	 	(b)	 	sell, transfer, licence, lease or otherwise dispose of any Security Asset,

	 	 	except as expressly allowed under the Finance Documents.

	5.	 	LAND
	 
	5.1	 	General
	 
	 	 	In this Clause:
	 
	 	 	Fixtures means all fixtures and fittings and fixed plant and machinery on the Mortgaged
Property.
	 
	 	 	Insured Property Assets means the Premises and all other assets of the Chargor of an
insurable nature in the Premises.
	 
	 	 	Mortgaged Property means all real property included in the definition of Security Assets.
	 
	 	 	Premises means all buildings and erections included in the definition of Security Assets.
	 
	 	 	Report on Title means any report on title on the Mortgaged Property addressed and provided
at the request of the Chargee before the date of this Deed or, in the case of any Mortgaged
Property acquired after the date of this Deed, its date of acquisition.
	 
	5.2	 	Information for Report on Title
	 
	 	 	The Chargor represents to each Finance Party that:

	 	(a)	 	the information provided to the lawyers who prepared any Report on Title
relating to any of its Mortgaged Property for the purpose of that Report on Title was
true in all material respects at the date it was expressed to be given;
	 
	 	(b)	 	the information referred to in paragraph (a) above was at the date it was
expressed to be given complete and did not omit any information which, if disclosed
would make that information untrue or misleading in any material respect; and
	 
	 	(c)	 	as at the date of this Deed, nothing has occurred since the date of any
information referred to in paragraph (a) above which renders that information untrue or
misleading in any respect and which, if disclosed, would make that information untrue
or misleading in any material respect.

	5.3	 	Title
	 
	 	 	The Chargor represents to each Finance Party that except as disclosed in any Report on Title
relating to any of its Mortgaged Property:

	 	(a)	 	it is the legal and beneficial owner of its Mortgaged Property;

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	 	(b)	 	no breach of any law or regulation is outstanding which affects or might affect
materially the value of its Mortgaged Property;
	 
	 	(c)	 	there are no covenants, agreements, stipulations, reservations, conditions,
interest, rights or other matters whatsoever affecting its Mortgaged Property;
	 
	 	(d)	 	nothing has arisen or has been created or is subsisting which would be an
overriding interest over its Mortgaged Property;
	 
	 	(e)	 	no facilities necessary for the enjoyment and use of its Mortgaged Property are
enjoyed by that Mortgaged Property on terms entitling any person to terminate or
curtail its use;
	 
	 	(f)	 	it has received no notice of any adverse claims by any person in respect of the
ownership of its Mortgaged Property or any interest in it, nor has any acknowledgement
been given to any person in respect of its Mortgaged Property; and
	 
	 	(g)	 	its Mortgaged Property is held by it free from any Security Interest or any
tenancies or licences.

	5.4	 	Repair
	 
	 	 	The Chargor must keep:

	 	(a)	 	its Premises in good and substantial repair and condition and adequately and
properly painted and decorated; and
	 
	 	(b)	 	its Fixtures and all plant, machinery, implements and other effects owned by it
and which are in or on its Premises or elsewhere in a good state of repair and in good
working order and condition.

	5.5	 	Insurance
	 
	(a)	 	The Chargor must insure its Insured Property Assets against:

	 	(i)	 	loss or damage by fire;
	 
	 	(ii)	 	other risks normally insured against by persons carrying on the same class of
business as that carried on by it; and
	 
	 	(iii)	 	any other risks which the Chargee may reasonably require.

	(b)	 	Any insurance must be in a sum or sums not less than the replacement value of the Insured
Property Assets. For this purpose, replacement value means the total cost of entirely
rebuilding, reinstating or replacing those Insured Property Assets in the event of their being
completely destroyed, together with architects’ and surveyors’ fees.
	 
	(c)	 	Any insurance required under this Clause must be with an insurance company or underwriters
acceptable to the Chargee.
	 
	(d)	 	All moneys received or receivable under any insurance in respect of the Insured Property
Assets must be applied:

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	 	(i)	 	in replacing, restoring or reinstating the Insured Property Assets destroyed or
damaged or in any other manner which the Chargee may agree; or
	 
	 	(ii)	 	after a Default has occurred, if the Chargee so directs and the terms of the
relevant insurances allow, in or towards satisfaction of the Secured Liabilities.

	(e)	 	The Chargor must procure that a note of each Finance Party’s interest is endorsed upon all
policies of insurance maintained by the Chargor or any person on its behalf in respect of the
Insured Property Assets.
	 
	(f)	 	The Chargor must not do or permit anything to be done which may make void or voidable any
policy of insurance in connection with any Insured Property Asset.
	 
	(g)	 	The Chargor must promptly pay all premiums and do all other things necessary to keep each
policy of insurance in respect of its Insured Property Assets in force.
	 
	(h)	 	The Chargor must, immediately on demand by the Chargee, produce to the Chargee the policy,
certificate or cover note relating to any insurance policy and the receipt for the payment of
any premium for any insurance policy as the Chargee may request.
	 
	5.6	 	Compliance with leases
	 
	 	 	The Chargor must:

	 	(a)	 	perform all the terms on its part contained in any lease comprised in the
Mortgaged Property; and
	 
	 	(b)	 	not do or allow to be done any act as a result of which any lease comprised in
its Mortgaged Property may become liable to forfeiture or otherwise be terminated.

	5.7	 	Acquisitions
	 
	(a)	 	If the Chargor acquires any real property after the date of this Deed it must:

	 	(i)	 	notify the Chargee immediately;
	 
	 	(ii)	 	immediately on request by the Chargee and at the cost of the Chargor, execute
and deliver to the Chargee a legal charge in favour of the Chargee of that property in
any form which the Chargee may require; and
	 
	 	(iii)	 	give the Hong Kong Land Registry written notice of this Security.

	(b)	 	If the consent of the landlord in whom the reversion of a lease is vested is required for the
Chargor to execute a legal charge over it, the Chargor will not be required to perform that
obligation unless and until it has obtained the landlord’s consent. The Chargor must use its
reasonable endeavours to obtain the landlord’s consent.
	 
	5.8	 	Compliance with applicable laws and regulations
	 
	 	 	The Chargor must perform all its obligations under any law or regulation in any way related
to or affecting its Mortgaged Property.

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	5.9	 	Notices
	 
	 	 	The Chargor must, within 14 days after the receipt by it of any application, requirement,
order or notice served or given by any public or local or any other authority with respect
to the Mortgaged Property (or any part of it):

	 	(a)	 	deliver a copy to the Chargee; and
	 
	 	(b)	 	inform the Chargee of the steps taken or proposed to be taken to comply with
the relevant requirement.

	5.10	 	Leases
	 
	 	 	The Chargor must not grant or agree to grant (whether in exercise or independently of any
statutory power) any lease or tenancy of the Mortgaged Property or any part of it or accept
a surrender of any lease or tenancy or confer upon any person any contractual licence or
right to occupy the Mortgaged Property.

	5.11	 	Deposit of title deeds
	 
	 	 	The Chargor must deposit with the Chargee all deeds and documents of title relating to its
Mortgaged Property and all land charges and Hong Kong Land Registry search certificates and
similar documents received by it or on its behalf.
	 
	5.12	 	Access
	 
	 	 	The Chargor must permit the Chargee and any person nominated by it at all reasonable times
to enter any part of its Mortgaged Property and view the state of it.
	 
	5.13	 	Investigation of title
	 
	 	 	The Chargor must grant the Chargee or its lawyers on request all facilities within the power
of the Chargor to enable the Chargee or its lawyers (at the expense of the Chargor) to:

	 	(a)	 	carry out investigations of title to the Mortgaged Property; and
	 
	 	(b)	 	make such enquiries in relation to any part of the Mortgaged Property as a
prudent mortgagee might carry out.

	5.14	 	Report on title
	 
	 	 	The Chargor must, as soon as practicable after a request by the Chargee, provide the Chargee
with a report on title of the Chargor to the Mortgaged Property concerning those items which
may properly be sought to be covered by a prudent mortgagee in a lawyer’s report of this
nature.
	 
	5.15	 	Power to remedy
	 
	 	 	If the Chargor fails to perform any term affecting its Mortgaged Property, the Chargor must
allow the Chargee or its agents and contractors:

	 	(a)	 	to enter any part of its Mortgaged Property;

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	 	(b)	 	to comply with or object to any notice served on the Chargor in respect of its
Mortgaged Property; and
	 
	 	(c)	 	to take any action as the Chargee may reasonably consider necessary or
desirable to prevent or remedy any breach of any such term or to comply with or object
to any such notice.

	 	 	The Chargor must immediately on request by the Chargee pay the costs and expenses of the
Chargee or its agents and contractors incurred in connection with any action taken by it
under this Subclause.

	5.16	 	Additional covenants and conditions
	 
	 	 	The Chargor must comply with all the covenants and conditions contained in Part C of the
Second Schedule to the Property Ordinance, which are deemed to be incorporated by reference
into this Deed. In the event of any conflict or inconsistency between such additional
covenants and conditions and the terms of this Deed, the latter shall prevail.
	 
	6.	 	INVESTMENTS
	 
	6.1	 	General
	 
	 	 	In this Clause:
	 
	 	 	Investments means:

	 	(a)	 	all shares, stocks, debentures, bonds or other securities and investments
included in the definition of Security Assets in Clause 1.1 (Definitions);
	 
	 	(b)	 	any dividend or interest paid or payable in relation to any of the above; and
	 
	 	(c)	 	any right, money or property accruing or offered at any time in relation to any
of the above by way of redemption, substitution, exchange, bonus or preference under
option rights or otherwise.

	6.2	 	Investments
	 
	 	 	The Chargor represents to each Finance Party that:

	 	(a)	 	to the extent applicable, its Investments, are duly authorised, validly issued,
fully paid and not subject to any option to purchase or other similar right;
	 
	 	(b)	 	subject to this Deed, it is the sole legal and beneficial owner of its
Investments.

	6.3	 	Deposit
	 
	(a)	 	The Chargor must promptly deliver to the Chargee, or as the Chargee may direct:

	 	(i)	 	all certificates and other documents of title or evidence of ownership in
relation to any of its Investments;
	 
	 	(ii)	 	all corresponding instruments of transfer and sold notes (undated and signed in
blank) in respect of the shares of any company being mortgaged by the Chargor under
this Deed duly signed by or on behalf of the Chargor and other documents which may be

15

 

	 	 	 	requested by the Chargee in order to enable the Chargee or its nominees to be
registered as the owner or otherwise obtain a legal title to any of its Investments;
and
	 
	 	(iii)	 	signed (but undated) letters of resignation of the directors and secretary of
any company whose shares are mortgaged by the Chargor under this Deed (the mortgaged
company) substantially in the form of Schedule 2 (Form of resignation letter);
	 
	 	(iv)	 	a signed (but undated) resolution of all the directors of the mortgaged company
approving the resignation of the directors and the secretary and the appointment of
persons nominated by the Chargee as directors and secretary of the mortgaged company
substantially in the form of Schedule 3 (Form of written resolution of directors); and
	 
	 	(v)	 	signed (and dated) letters of authorisation of each of the directors and the
secretary of the mortgaged company substantially in the form of Schedule 4 (Form of
authorisation letter) authorising the Chargee or any of its officers to complete, date
and put into effect the letters of resignation of the directors and secretary referred
to in paragraph (iii) above and the resolutions of the directors referred to in
paragraph (iv) above.

	(b)	 	Forthwith upon any right, money or property (including any share, stock, debenture, bond or
other securities or investments) becoming a Security Asset, the Chargor must deliver to the
Chargee (or as the Chargee may direct) all documents referred to in sub-paragraphs (a)(i) and
(ii) above as if the references to the Security Asset in those sub-paragraphs were references
to such right, money or property.
	 
	(c)	 	Before this Security becomes enforceable, the Chargor may only dismiss or remove from office
or accept the resignation of any person acting as a director or secretary of and/or appoint or
accept the appointment of any other person as a director or the secretary of any mortgaged
company with the prior written consent of the Chargee.
	 
	(d)	 	Immediately upon the appointment of any person as a director or the secretary of any
mortgaged company, the Chargor must procure the delivery to the Chargee of the documents
referred to in sub-paragraphs (iii) to (v) above signed by the relevant person.
	 
	(e)	 	After this Security has become enforceable, the Chargee shall have the right to complete,
date and put into effect the documents referred to in sub-paragraphs (iii) and (iv) above and
to appoint such persons as the Chargee shall think fit as directors and secretary of any
mortgaged company.
	 
	6.4	 	Changes to rights
	 
	 	 	The Chargor must not take or allow the taking of any action on its behalf which may result
in the rights attaching to any of its Investments being altered or further shares in any
mortgaged company being issued.
	 
	6.5	 	Calls
	 
	(a)	 	The Chargor must pay all calls or other payments due and payable in respect of any of its
Investments.

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	(b)	 	If the Chargor fails to do so, the Chargee may pay the calls or other payments on behalf of
the Chargor. The Chargor must immediately on request reimburse the Chargee for any payment
made by the Chargee under this Subclause.
	 
	6.6	 	Other obligations in respect of Investments
	 
	(a)	 	The Chargor must promptly copy to the Chargee and comply with all requests for information
which is within its knowledge and (i) which are made under any law or regulation; (ii) any
listing or other authority (including Section 329 of the Securities and Futures Ordinance
(Cap. 571 of the Laws of Hong Kong) or any similar provision; and (iii) any provision
contained in any articles of association or other constitutional document relating to any of
its Investments. If it fails to do so, the Chargee may elect to provide such information as
it may have on behalf of the Chargor.
	 
	(b)	 	The Chargor must comply with all other conditions and obligations assumed by it in respect of
any of its Investments.
	 
	(c)	 	The Chargee is not obliged to:

	 	(i)	 	perform any obligation of the Chargor;
	 
	 	(ii)	 	make any payment, or to make any enquiry as to the nature or sufficiency of any
payment received by it or the Chargor; or
	 
	 	(iii)	 	present or file any claim or take any other action to collect or enforce the
payment of any amount to which it may be entitled under this Deed,

	 	 	in respect of any Investment.

	6.7	 	Voting rights
	 
	(a)	 	Until an Event of Default is outstanding:

	 	(i)	 	the Chargor may continue to exercise the voting rights, powers and other rights
in respect of the Investments; and
	 
	 	(ii)	 	all dividends or other income paid or payable in relation to any Investments
must be paid in accordance with the terms of the Finance Documents.

	 	 	The Chargor must indemnify the Chargee to its satisfaction (including with or without
security in respect of such indemnity) against any loss or liability or expense suffered or
incurred by the Chargee as a consequence of the Chargee acting in respect of the Investments
on the direction of the Chargor.

	(b)	 	If an Event of Default is outstanding, the Chargee may exercise (in the name of the Chargor
and without any further consent or authority on the part of the Chargor) any voting rights and
any powers or rights which may be exercised by the legal or beneficial owner of any
Investment, any person who is the holder of any Investment or otherwise.
	 
	6.8	 	Clearance systems
	 
	 	 	The Chargor must, if so requested by the Chargee, instruct any clearance system to transfer
any Investment held by it for the Chargor or its nominee to an account of the Chargee, an
Account Bank or its nominee with that clearance system.

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	6.9	 	Custodian arrangements
	 
	 	 	The Chargor must:

	 	(a)	 	promptly give notice to any custodian of any agreement with that custodian in
respect of any Investment in a form the Chargee may require; and
	 
	 	(b)	 	ensure that the custodian acknowledges that notice in a form the Chargee may
require.

	7.	 	INTELLECTUAL PROPERTY
	 
	7.1	 	General
	 
	 	 	In this Clause Intellectual Property Rights means:

	 	(a)	 	any know-how, patent, trade mark, service mark, design, business name,
topographical or similar right;
	 
	 	(b)	 	any copyright or other intellectual property monopoly right;
	 
	 	(c)	 	any interest (including by way of licence) in any of the above; or
	 
	 	(d)	 	any application for any of the above,

	 	 	in each case, whether registered or not, and whether or not included in Schedule 1 (Security
Assets) under the heading Specific Intellectual Property Rights.

	7.2	 	Representations
	 
	 	 	The Chargor represents to each Finance Party that:

	 	(a)	 	the Intellectual Property Rights owned by it are all of the Intellectual
Property Rights required by it in order for it to carry on its business as it is now
being conducted;
	 
	 	(b)	 	it is the sole legal and beneficial owner of those Intellectual Property
Rights;
	 
	 	(c)	 	those Intellectual Property Rights are free of any Security Interests (except
for those created by or under this Deed) and any other rights or interests (including
any licences) in favour of third parties;
	 
	 	(d)	 	it does not, in carrying on its business, infringe any Intellectual Property
Rights of any third party; and
	 
	 	(e)	 	to its knowledge, no Intellectual Property Right owned by it is being
infringed, nor is there any threatened infringement of any such Intellectual Property
Right.

	7.3	 	Preservation
	 
	(a)	 	The Chargor must:

	 	(i)	 	make such registrations and pay such fees, registration taxes and similar
amounts as are necessary to keep its Intellectual Property Rights necessary for its or
the relevant member of the Group’s business in full force and effect and record its
interest in that Intellectual Property Right;

18

 

	 	(ii)	 	take all other steps which are reasonably practicable to maintain and preserve
its interests in and the subsistence and validity of its Intellectual Property Rights
necessary for its or the relevant member of the Group’s business;
	 
	 	(iii)	 	if requested to do so by the Chargee, make entries in any public register of
its Intellectual Property Rights which either record the existence of this Deed or the
restrictions on disposal imposed by this Deed;
	 
	 	(iv)	 	use reasonable endeavours to prevent any infringement in any material respect
of its Intellectual Property Rights necessary for its or the relevant member of the
Group’s business; and
	 
	 	(v)	 	not use or permit its Intellectual Property Rights necessary for its or the
relevant member of the Group’s business to be used in a way or take any step or omit to
take any step in respect of that Intellectual Property Right which may materially and
adversely affect the existence or value of its Intellectual Property Rights or imperil
the right of any member of the Group to use such Intellectual Property Rights.

	(b)	 	The Chargor must ensure that, except with the prior consent of the Chargee, none of its
Intellectual Property Rights necessary for its or the relevant member of the Group’s business
which is registered is abandoned or cancelled, lapses or is liable to any claim of abandonment
for non-use or otherwise.
	 
	8.	 	ACCOUNTS
	 
	8.1	 	Representations
	 
	 	 	The Chargor represents to each Finance Party that:

	 	(a)	 	as at the date of this Deed, no Security Account exists;
	 
	 	(b)	 	it is the sole legal and beneficial owner of the credit balances from time to
time in each Security Account and the fixed or time deposits created or funded out of
such credit balances; and
	 
	 	(c)	 	those credit balances and fixed or time deposits are free of any Security
Interests (except for those created by or under this Deed) and (other than any netting
or set-off arrangement, arising by operation of law or contained in an Account Bank’s
standard account opening documentation used in ordinary day-to-day banking
arrangements, for the purpose of netting debit and credit balances) any other rights or
interests in favour of third parties.

	8.2	 	Accounts
	 
	(a)	 	The Chargor must not establish or maintain any account unless the Chargee has given its prior
written consent and such account constitutes a Security Account.
	 
	(b)	 	All Security Accounts must be maintained at a branch of the Account Bank approved by the
Chargee.
	 
	8.3	 	Change of Account Bank
	 
	(a)	 	The Account Bank may be changed to another bank or financial institution if the Chargee so
requires.

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	(b)	 	A change only becomes effective when the proposed new Account Bank agrees with the Chargee
and the Chargor, in a manner satisfactory to the Chargee, to fulfil the role of the Account
Bank under this Deed.
	 
	(c)	 	If there is a change of Account Bank, the amount (if any) standing to the credit of the
Security Accounts maintained with the old Account Bank will be transferred to the
corresponding Security Accounts maintained with the new Account Bank immediately upon the
appointment taking effect.
	 
	(d)	 	The Chargor must take any action which the Chargee may require to facilitate a change of
Account Bank and any transfer of credit balances (including the execution of bank mandate
forms).
	 
	8.4	 	Interest
	 
	 	 	Amounts standing to the credit of each Security Account will bear interest at a rate
considered by the Account Bank to be a fair market rate.
	 
	8.5	 	Book debts and receipts
	 
	(a)	 	The Chargor must get in and realise its:

	 	(i)	 	securities to the extent held by way of temporary investment;
	 
	 	(ii)	 	book and other debts and other moneys due and owing to it; and
	 
	 	(iii)	 	royalties, fees and income of any nature owed to it,

	 	 	in the ordinary course of its business and hold the proceeds of the getting in and
realisation (until payment into a Security Account if required in accordance with paragraph
(b) below) on trust for the Chargee.

	(b)	 	The Chargor must, except to the extent that the Chargee otherwise agrees, pay all the
proceeds of the getting in and realisation into a Security Account.
	 
	8.6	 	Withdrawals
	 
	(a)	 	Except with the prior consent of the Chargee or as provided below, the Chargor must not
withdraw any moneys standing to the credit of a Security Account.
	 
	(b)	 	The Chargee (or a Receiver) may (subject to the payment of any claims having priority to this
Security) withdraw amounts standing to the credit of a Security Account to meet an amount due
and payable under the Finance Documents when it is due and payable.
	 
	8.7	 	Notices of charge
	 
	 	 	The Chargor must:

	 	(a)	 	immediately following the execution of this Deed or following the establishment
of a Security Account, give notice to each Account Bank at which the Security Account
is held substantially in the form of Part 1 of Schedule 5 (Forms of letter for Account
Bank); and

20

 

	 	(b)	 	ensure that each Account Bank acknowledges the notice substantially in the
form of Part 2 of Schedule 5 (Forms of letter for Account Bank).

	9.	 	RELEVANT CONTRACTS
	 
	9.1	 	General
	 
	 	 	In this Clause:
	 
	 	 	Relevant Contract means:

	 	(a)	 	an agreement specified in Schedule 1 (Security Assets) under the heading
Relevant Contracts; and

	 	(b)	 	any other agreement to which the Chargor is a party and which the Chargee has
designated a Relevant Contract.

	9.2	 	Representations
	 
	 	 	The Chargor represents to each Finance Party that:

	 	(a)	 	all payments to it by any other party to a Relevant Contract to which it is a
party are not subject to any right of set-off or similar right;

	 	(b)	 	each such Relevant Contract is its legally binding, valid, and enforceable
obligation;

	 	(c)	 	it is not in default of any of its obligations under any such Relevant
Contract;
	 
	 	(d)	 	there is no prohibition on assignment in any such Relevant Contract; and
	 
	 	(e)	 	its entry into and performance of this Deed will not conflict with any term of
any such Relevant Contract.

	9.3	 	Preservation
	 
	 	 	The Chargor must not, without the prior consent of the Chargee:

	 	(a)	 	amend or waive any term of, or terminate, any Relevant Contract to which it is
a party; or

	 	(b)	 	take any action which might jeopardise the existence or enforceability of any
such Relevant Contract.

	9.4	 	Other undertaking
	 
	 	 	The Chargor must:

	 	(a)	 	duly and promptly perform its obligations, and diligently pursue its rights,
under each Relevant Contract to which it is a party; and
	 
	 	(b)	 	supply the Chargee and any Receiver with copies of each such Relevant Contract
and any information and documentation relating to any such Relevant Contract requested
by the Chargee or any Receiver.

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	9.5	 	Notices of assignment
	 
	 	 	The Chargor must:

	 	(a)	 	immediately following the execution of this Deed or following the execution of
a Relevant Contract, serve a notice of assignment, substantially in the form of Part 1
of Schedule 6 (Forms of letter for Relevant Contracts), on each counterparty to a
Relevant Contract to which it is a party; and

	 	(b)	 	use its reasonable endeavours to procure that each such party acknowledges that
notice, substantially in the form of Part 2 of Schedule 6 (Forms of letter for Relevant
Contracts) within 10 days of the notice referred to in paragraph (a) above.

	10.	 	WHEN SECURITY BECOMES ENFORCEABLE
	 
	10.1	 	Event of Default
	 
	 	 	This Security will become immediately enforceable if an Event of Default is outstanding.

	 
	10.2 	 	
Discretion
	 
	 	 	If an Event of Default is outstanding, the Chargee may in its absolute discretion enforce
all or any part of this Security in any manner it sees fit or in accordance with the
Guarantee and Undertaking.
	 
	10.3	 	Power of sale

	(a)	 	If an Event of Default is outstanding, the Chargee may, without prior notice to the Chargor
or prior authorisation from any court or otherwise any other person, sell or otherwise dispose
of all or any part of the Security Assets at the times, in the manner and on the terms it
thinks fit.
	 
	(b)	 	The power of sale and other powers conferred (or deemed by this Deed to be conferred) by the
Property Ordinance, as amended by this Deed, will be immediately exercisable at any time if an
Event of Default is outstanding.

	11.	 	ENFORCEMENT OF SECURITY
	 
	11.1	 	General
	 
	 	 	Paragraph 11 of the Fourth Schedule to the Property Ordinance does not apply to this
Security.
	 
	11.2	 	No liability as mortgagee in possession
	 
	 	 	Neither the Chargee nor any Receiver will be liable, by reason of entering into possession
of a Security Asset, to account as mortgagee in possession or for any loss on realisation or
for any default or omission for which a mortgagee in possession might be liable.
	 
	11.3	 	Privileges
	 
	 	 	Each Receiver and the Chargee is entitled to all the rights, powers, privileges and
immunities of mortgagees and receivers referred to in the Property Ordinance as if it were
such a mortgagee or receiver (and so that the statutory power of sale shall be exercisable
without regard to paragraph 11 of the Fourth Schedule to the Property Ordinance).

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	11.4	 	Protection of third parties
	 
	 	 	No person (including a purchaser) dealing with the Chargee or a Receiver or its or his
agents will be concerned to enquire:

	 	(a)	 	whether the Secured Liabilities have become payable;
	 
	 	(b)	 	whether any power which the Chargee or a Receiver is purporting to exercise has
become exercisable or is being properly exercised;
	 
	 	(c)	 	whether any money remains due under the Finance Documents; or
	 
	 	(d)	 	how any money paid to the Chargee or to that Receiver is to be applied.

	11.5	 	Redemption of prior mortgages
	 
	(a)	 	At any time after this Security has become enforceable, the Chargee may:

	 	(i)	 	redeem any prior Security Interest against any Security Asset; and/or
	 
	 	(ii)	 	procure the transfer of that Security Interest to itself; and/or
	 
	 	(iii)	 	settle and pass the accounts of the prior mortgagee, chargee or encumbrancer;
any accounts so settled and passed will be, in the absence of manifest error,
conclusive and binding on the Chargor.

	(b)	 	The Chargor must pay to the Chargee, immediately on demand, the costs and expenses incurred
by the Chargee in connection with any such redemption and/or transfer, including the payment
of any principal or interest.

	11.6	 	Contingencies
	 
	 	 	If this Security is enforced at a time when no amount is due under the Finance Documents but
at a time when amounts may or will become due, the Chargee (or the Receiver) may pay the
proceeds of any recoveries effected by it into a suspense account.
	 
	12.	 	RECEIVER
	 
	12.1	 	Appointment of Receiver
	 
	(a)	 	The Chargee may appoint any one or more persons to be a Receiver of all or any part of the
Security Assets if:

	 	(i)	 	an Event of Default is outstanding; or
	 
	 	(ii)	 	the Chargor so requests the Chargee in writing at any time.

	(b)	 	Any appointment under paragraph (a) above may be by deed, under seal or in writing under its
hand.

	12.2	 	Removal
	 
	 	 	The Chargee may by writing under its hand remove any Receiver appointed by it and may,
whenever it thinks fit, appoint a new Receiver in the place of any Receiver whose
appointment may for any reason have terminated.

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	12.3	 	Remuneration
	 
	 	 	The Chargee may fix the remuneration of any Receiver appointed by it.
	 
	12.4	 	Agent of Chargor
	 
	(a)	 	A Receiver will be deemed to be the agent of the Chargor for all purposes and accordingly
will be deemed to be in the same position as a Receiver duly appointed by a mortgagee under
the Property Ordinance. The Chargor alone is responsible for the contracts, engagements,
acts, omissions, defaults and losses of a Receiver and for liabilities incurred by a Receiver.
	 
	(b)	 	No Finance Party will incur any liability (either to the Chargor or to any other person) by
reason of the appointment of a Receiver or for any other reason.
	 
	12.5	 	Relationship with Chargee
	 
	 	 	To the fullest extent allowed by law, any right, power or discretion conferred by this Deed
(either expressly or impliedly) or by law on a Receiver may after this Security becomes
enforceable be exercised by the Chargee in relation to any Security Asset without first
appointing a Receiver and notwithstanding the appointment of a Receiver.
	 
	13.	 	POWERS OF RECEIVER

	13.1	 	General
	 
	(a)	 	A Receiver has all of the rights, powers and discretions set out below in this Clause in
addition to those conferred (or deemed by this Deed to be conferred) on it by any law,
including all the rights, powers and discretions conferred on a receiver under the Property
Ordinance.
	 
	(b)	 	If there is more than one Receiver holding office at the same time, each Receiver may (unless
the document appointing him states otherwise) exercise all of the powers conferred on a
Receiver under this Deed individually and to the exclusion of any other Receiver.
	 
	13.2	 	Possession
	 
	 	 	A Receiver may take immediate possession of, get in and collect any Security Asset and
without prejudice to the foregoing, cause to be registered all or any part of the Security
Assets in its own name or in the name of its nominee(s) or in the name of any purchaser(s)
thereof.
	 
	13.3	 	Carry on business
	 
	 	 	A Receiver may carry on the business of the Chargor in any manner he thinks fit.

	13.4	 	Employees
	 
	(a)	 	A Receiver may appoint and discharge managers, officers, agents, accountants, servants,
workmen and others for the purposes of this Deed upon such terms as to remuneration or
otherwise as he thinks fit.
	 
	(b)	 	A Receiver may discharge any person appointed by the Chargor.

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	13.5	 	Borrow money
	 
	 	 	A Receiver may raise and borrow money either unsecured or on the security of any Security
Asset either in priority to this Security or otherwise and generally on any terms and for
whatever purpose which he thinks fit.
	 
	13.6	 	Sale of assets
	 
	(a)	 	A Receiver may sell, exchange, convert into money and realise any Security Asset by public
auction or private contract and generally in any manner and on any terms which he thinks fit.
	 
	(b)	 	The consideration for any such transaction may consist of cash, debentures or other
obligations, shares, stock or other valuable consideration and any such consideration may be
payable in a lump sum or by instalments spread over any period which he thinks fit.
	 
	(c)	 	Fixtures, other than landlord’s fixtures, may be severed and sold separately from the
property containing them without the consent of the Chargor.
	 
	13.7	 	Leases
	 
	 	 	A Receiver may let or licence any Security Asset for any term and at any rent (with or
without a premium) which he thinks fit and may accept a surrender of any lease or tenancy or
licence of any Security Asset on any terms which he thinks fit (including the payment of
money to a licensee, lessee or tenant on a surrender).
	 
	13.8	 	Compromise
	 
	 	 	A Receiver may settle, adjust, refer to arbitration, compromise and arrange any claim,
account, dispute, question or demand with or by any person who is or claims to be a creditor
of the Chargor or relating in any way to any Security Asset.
	 
	13.9	 	Legal actions
	 
	 	 	A Receiver may bring, prosecute, enforce, defend and abandon any action, suit or proceedings
in relation to any Security Asset which he thinks fit.
	 
	13.10	 	Receipts
	 
	 	 	A Receiver may give a valid receipt for any moneys and execute any assurance or thing which
may be proper or desirable for realising any Security Asset.
	 
	13.11	 	Subsidiaries
	 
	 	 	A Receiver may form a Subsidiary of the Chargor and transfer to that Subsidiary any Security
Asset.
	 
	13.12	 	Delegation
	 
	 	 	A Receiver may delegate his powers in accordance with this Deed.
	 
	13.13	 	Lending
	 
	 	 	A Receiver may lend money or advance credit to any customer of the Chargor.

25

 

	13.14	 	Covenants, guarantees and indemnities
	 
	 	 	A Receiver may enter into bonds, covenants, guarantees, commitments, indemnities and other
obligations or liabilities as he shall think fit, make all payments needed to effect,
maintain or satisfy such obligations or liabilities and use the company seal (if any) of the
Chargor.
	 
	13.15	 	Acquisitions
	 
	 	 	A Receiver may purchase, lease, hire or otherwise acquire any assets or rights of any
description that he, in his absolute discretion, considers necessary or desirable for the
improvement or realisation of the whole or any part of the Security Assets or otherwise for
the benefit of the whole or any part of the Security Assets.
	 
	13.16	 	Protection of assets
	 
	 	 	A Receiver may:

	 	(a)	 	effect any repair or insurance and do any other act which the Chargor might do
in the ordinary conduct of its business to protect, preserve, maintain, manage or
improve any Security Asset;
	 
	 	(b)	 	commence and/or complete any building operation; and
	 
	 	(c)	 	apply for and maintain any planning permission, building regulation approval or
any other authorisation,
	 
	 	 	 	in each case as he thinks fit.

	13.17	 	Other powers
	 
	 	 	A Receiver may:

	 	(a)	 	do all other acts and things which he may consider desirable or necessary for
realising any Security Asset or incidental or conducive to any of the rights, powers or
discretions conferred on a Receiver under or by virtue of this Deed or law;
	 
	 	(b)	 	exercise in relation to any Security Asset all the powers, authorities and
things which he would be capable of exercising if he were the absolute beneficial owner
of that Security Asset; and
	 
	 	(c)	 	use the name of the Chargor for any of the above purposes.

	14.	 	APPLICATION OF PROCEEDS
	 
	(a)	 	Any moneys received by the Chargee or any Receiver after this Security has become enforceable
must be applied in the order of priority as set out in clause 5.7 (Partial Payments) of the
Guarantee and Undertaking.
	 
	(b)	 	This Clause is subject to the payment of any claims having priority over this Security. This
Clause does not prejudice the right of any Finance Party to recover any shortfall from the
Chargor.

26

 

	15.	 	EXPENSES AND INDEMNITY
	 
	(a)	 	The Chargor must:

	 	(i)	 	immediately on demand pay all costs and expenses (including legal fees)
incurred in connection with this Deed by any Finance Party, Receiver, attorney,
manager, agent or other person appointed by the Chargee under this Deed including any
arising from any actual or alleged breach by any person of any law or regulation,
whether relating to the environment or otherwise; and

	 	(ii)	 	keep each of them indemnified against any failure or delay in paying those
costs or expenses.

	(b)	 	This Clause shall survive any termination of this Deed.
	 
	16.	 	DELEGATION
	 
	16.1	 	Power of Attorney
	 
	 	 	The Chargee or any Receiver may delegate by power of attorney or in any other manner to any
person any right, power or discretion exercisable by it under this Deed.
	 
	16.2	 	Terms
	 
	 	 	Any such delegation may be made upon any terms (including power to sub-delegate) which the
Chargee or any Receiver may think fit.
	 
	16.3	 	Liability
	 
	 	 	Neither the Chargee nor any Receiver will be in any way liable or responsible to the Chargor
for any loss or liability arising from any act, default, omission or misconduct on the part
of any delegate or sub-delegate except where such a loss or liability results from the gross
negligence or wilful misconduct of the Chargee or that Receiver.
	 
	17.	 	FURTHER ASSURANCES
	 
	 	 	The Chargor must, at its own expense, take whatever action the Chargee or a Receiver may
require for:

	 	(a)	 	creating, perfecting or protecting any security intended to be created by this
Deed; or

	 	(b)	 	facilitating the realisation of any Security Asset, or the exercise of any
right, power or discretion exercisable, by the Chargee or any Receiver or any of its
delegates or sub-delegates in respect of any Security Asset.

	 	 	This includes:

	 	(i)	 	the execution of any transfer, conveyance, assignment or assurance of any
property, whether to the Chargee or to its nominee; or

	 	(ii)	 	the giving of any notice, order or direction and the making of any registration
or renewal,

	 	 	which, in any such case, the Chargee may think expedient.

27

 

	18.	 	POWER OF ATTORNEY
	 
	 	 	The Chargor, by way of security, irrevocably and severally appoints the Chargee, each
Receiver and any of its delegates or sub-delegates to be its attorney to take any action
which the Chargor is obliged to take (but failed to take) under this Deed. The Chargor
ratifies and confirms whatever any attorney does or purports to do under its appointment
under this Clause.
	 
	19.	 	PRESERVATION OF SECURITY
	 
	19.1	 	Continuing security
	 
	 	 	This Security is a continuing security and will extend to the ultimate balance of the
Secured Liabilities, regardless of any intermediate payment or discharge in whole or in
part.
	 
	19.2	 	Reinstatement
	 
	(a)	 	If any discharge (whether in respect of the obligations of any Obligor or any security for
those obligations or otherwise) or arrangement is made in whole or in part on the faith of any
payment, security or other disposition which is avoided or must be restored on insolvency,
liquidation, administration or otherwise without limitation, the liability of the Chargor
under this Deed will continue or be reinstated as if the discharge or arrangement had not
occurred.
	 
	(b)	 	Each Finance Party may concede or compromise any claim that any payment, security or other
disposition is liable to avoidance or restoration.
	 
	19.3	 	Waiver of defences
	 
	 	 	The obligations of the Chargor under this Deed will not be affected by any act, omission or
thing (whether or not known to it or any Finance Party) which, but for this provision, would
reduce, release or prejudice any of its obligations under this Deed. This includes:

	 	(a)	 	any time or waiver granted to, or composition with, any person;
	 
	 	(b)	 	any release of any person under the terms of any composition or arrangement;
	 
	 	(c)	 	the taking, variation, compromise, exchange, renewal or release of, or refusal
or neglect to perfect, take up or enforce, any rights against, or security over assets
of, any person;
	 
	 	(d)	 	any non-presentation or non-observance of any formality or other requirement in
respect of any instrument or any failure to realise the full value of any security;
	 
	 	(e)	 	any incapacity or lack of power, authority or legal personality of or
dissolution or change in the members or status of any person;
	 
	 	(f)	 	any amendment (however fundamental) of a Finance Document or any other document
or security;
	 
	 	(g)	 	any unenforceability, illegality, invalidity or non-provability of any
obligation of any person under any Finance Document or any other document or security
or the failure by any member of the Group to enter into or be bound by any Finance
Document; or
	 
	 	(h)	 	any insolvency or similar proceedings.

28

 

	19.4	 	Immediate recourse
	 
	(a)	 	The Chargor waives any right it may have of first requiring any Finance Party (or any trustee
or agent on its behalf) to proceed against or enforce any other right or security or claim
payment from any person or file any proof or claim in any insolvency, administration,
winding-up or liquidation proceedings relative to any other Obligor or any other person before
claiming from the Chargor under this Deed.
	 
	(b)	 	This waiver applies irrespective of any law or provision of a Finance Document to the
contrary.
	 
	19.5	 	Appropriations
	 
	 	 	At any time during the Security Period, each Finance Party (or any trustee or agent on its
behalf) may without affecting the liability of the Chargor under this Deed:

	 	(a)	(i)	 	 	refrain from applying or enforcing any other moneys, security or rights
held or received by that Finance Party (or any trustee or agent on its behalf) against
those amounts; or

	 	(ii)	 	apply and enforce the same in such manner and order as it sees
fit (whether against those amounts or otherwise; and

	 	(b)	 	hold in a suspense account any moneys received from the Chargor or on account
of the Chargor’s liability under this Deed.

	19.6	 	Non-competition
	 
	 	 	Unless the Security Period has expired or the Chargee otherwise directs, the Chargor will
not, after a claim has been made under this Deed or by virtue of any payment or performance
by it under this Deed:

	 	(a)	 	be subrogated to any rights, security or moneys held, received or receivable by
any Finance Party (or any trustee or agent on its behalf);

	 	(b)	 	be entitled to any right of contribution or indemnity in respect of any payment
made or moneys received on account of the Chargor’s liability under this Deed;

	 	(c)	 	claim, rank, prove or vote as a creditor of any Obligor or its estate in
competition with any Finance Party (or any trustee or agent on its behalf); or

	 	(d)	 	receive, claim or have the benefit of any payment, distribution or security
from or on account of any Obligor, or exercise any right of set-off as against any
Obligor.

	 	 	The Chargor must hold in trust for and immediately pay or transfer to the Chargee for the
Finance Parties any payment or distribution or benefit of security received by it contrary
to this Clause or in accordance with any directions given by the Chargee under this Clause.
	 
	19.7	 	Additional security
	 
	(a)	 	This Security is in addition to and is not in any way prejudiced by any other security now or
subsequently held by any Finance Party.

29

 

	(b)	 	No prior security held by any Finance Party (in its capacity as such or otherwise) over any
Security Asset will merge into this Security.
	 
	19.8	 	Security held by Chargor
	 
	 	 	The Chargor must not, without the prior consent of the Chargee, hold any security from any
other Obligor in respect of the Chargor’s liability under this Deed. The Chargor will hold
any security held by it in breach of this provision on trust for the Chargee.
	 
	20.	 	MISCELLANEOUS
	 
	20.1	 	Covenant to pay
	 
	 	 	The Chargor must pay or discharge the Secured Liabilities in the manner provided for in the
Finance Documents provided that the liability of the Chargor under this covenant is limited
to the net proceeds of sale or enforcement of the Security Assets.
	 
	20.2	 	New Accounts
	 
	(a)	 	If any subsequent charge or other interest affects any Security Asset, a Finance Party may
open a new account with the Chargor.
	 
	(b)	 	If the Finance Party does not open a new account, it will nevertheless be treated as if it
had done so at the time when it received or was deemed to have received notice of that charge
or other account.
	 
	(c)	 	As from that time all payments made to the Finance Party will be credited or be treated as
having been credited to the new account and will not operate to reduce any Secured Liability.
	 
	20.3	 	Time deposits
	 
	 	 	Without prejudice to any right of set-off any Finance Party may have under any other Finance
Document or otherwise, if any time deposit matures on any account the Chargor has with any
Finance Party within the Security Period when:

	 	(a)	 	this Security has become enforceable; and
	 
	 	(b)	 	no Secured Liability is due and payable,

	 	 	that time deposit will automatically be renewed for any further maturity which that Finance
Party considers appropriate.

	20.4	 	Certificates and determinations
	 
	 	 	Any certification or determination by the Chargee of an amount under this Deed will be, in
the absence of manifest error, conclusive evidence of the matters to which it relates.
	 
	20.5	 	Disclosure of information
	 
	 	 	Each Finance Party may disclose information in connection with this Deed in accordance with
clause 16 (Disclosure of information) of the Guarantee and Undertaking.

30

 

	21.	 	RELEASE
	 
	(a)	 	At the end of the Security Period, the Finance Parties must, at the request and cost of the
Chargor, take whatever action is reasonably necessary to release the Security Assets from this
Security.
	 
	(b)	 	Any release in relation to the Chargor will be conditional upon no security or payment to the
Chargee by or on behalf of the Chargor and/or any other Obligor being avoided or reduced by
virtue of any bankruptcy, insolvency, liquidation or similar laws of general application and
will in those circumstances be void.
	 
	22.	 	SEVERABILITY
	 
	 	 	If a term of this Deed is or becomes illegal, invalid or unenforceable in any respect under
any jurisdiction, that will not affect:

	 	(a)	 	the legality, validity or enforceability in that jurisdiction of any other term
of this Deed; or

	 	(b)	 	the legality, validity or enforceability in any other jurisdiction of that or
any other term of this Deed.

	23.	 	NOTICES
	 
	23.1	 	In writing
	 
	(a)	 	Any communication in connection with this Deed must be in writing and, unless otherwise
stated, may be given:

	 	(i)	 	in person, by post or fax; or
	 
	 	(ii)	 	to the extent agreed by the Parties making and receiving communication, by
e-mail or other electronic communication.

	(b)	 	For the purpose of this Deed, an electronic communication will be treated as being in
writing.

	(c)	 	Unless it is agreed to the contrary, any consent or agreement required under this Deed must
be given in writing.
	 
	23.2	 	Contact details
	 
	(a)	 	Except as provided below, the contact details of each Party for all communications in
connection with this Deed are those notified by that Party for this purpose to the Chargee on
or before the date it becomes a Party.
	 
	(b)	 	The contact details of the Chargor for this purpose are:

	 	 	 	 	 
	 

	 	Address:
	 	No. 3055, Fu Xing West Road, Baoding Hebei, PRC 071051
	 

	 	Fax number:
	 	+86 312 8929 800
	 

	 	E-mail:
	 	mqing@yinglisolar.com
	 

	 	Attention:
	 	Ms. Miao Qing

	(c)	 	The contact details of the Chargee for this purpose are:

	 	 	 	 	 
	 

	 	Address:
	 	c/o Asia Debt Management Hong Kong Limited

31

 

	 	 	 	 	 
	 

	 	 	 	1008 ICBC Tower
	 

	 	 	 	3 Garden Road Central
	 

	 	 	 	Hong Kong
	 

	 	Fax number:
	 	+852 2147 2813
	 

	 	Attention:
	 	Grace Tan / Chris Chan

	(d)	 	Any Party may change its contact details by giving five Business Days’ notice to the other
Party.
	 
	(e)	 	Where a Party nominates a particular department or officer to receive a communication, a
communication will not be effective if it fails to specify that department or officer.
	 
	23.3	 	Effectiveness
	 
	(a)	 	Except as provided below, any communication in connection with this Deed will be deemed to be
given as follows:

	 	(i)	 	if delivered in person, at the time of delivery;
	 
	 	(ii)	 	if posted, five Business Days after being deposited in the post, postage
prepaid, in a correctly addressed envelope;
	 
	 	(iii)	 	if by fax, when received in legible form; and
	 
	 	(iv)	 	if by e-mail or any other electronic communication, when received in legible
form.

	(b)	 	A communication given under paragraph (a) above but received on a non-Business Day or after
business hours in the place of receipt will only be deemed to be given on the next Business
Day in that place.
	 
	(c)	 	A communication to the Chargee will only be effective on actual receipt by it.
	 
	24.	 	LANGUAGE
	 
	 	 	Any notice given in connection with this Deed must be in English.
	 
	25.	 	AMENDMENTS AND WAIVERS
	 
	25.1	 	Procedures
	 
	 	 	Subject to the Guarantee and Undertaking, any term of this Deed may be amended or waived
with the agreement of the Chargor and the Chargee. The Chargee may effect, on behalf of any
Finance Party, an amendment or waiver allowed under this Clause.
	 
	25.2	 	Waivers and remedies cumulative
	 
	 	 	The rights of each Finance Party under this Deed:

	 	(a)	 	may be exercised as often as necessary;
	 
	 	(b)	 	are cumulative and not exclusive of its rights under the general law; and
	 
	 	(c)	 	may be waived only in writing and specifically.

	 	 	Delay in exercising or non-exercise of any right is not a waiver of that right.

32

 

	26.	 	SET-OFF
	 
	 	 	A Finance Party may set off any matured obligation owed to it by the Chargor under this Deed
(to the extent beneficially owned by that Finance Party) against any obligation (whether or
not matured) owed by that Finance Party to the Chargor, regardless of the place of payment,
booking branch or currency of either obligation. If the obligations are in different
currencies, the Finance Party may convert either obligation at a market rate of exchange in
its usual course of business for the purpose of the set-off.
	 
	27.	 	PRO-RATA SHARING
	 
	 	 	Clause 18 (Pro Rata Sharing) of the Guarantee and Undertaking shall apply to any amount
owing by the Chargor under this Deed to a Finance Party and is discharged by payment,
set-off or any other manner other than in accordance with the Guarantee and Undertaking.
	 
	28.	 	CHANGES TO THE PARTIES
	 
	28.1	 	The Chargor
	 
	 	 	The Chargor may not assign or transfer any of its rights or obligations under this Deed.
	 
	28.2	 	The Finance Parties
	 
	(a)	 	The Chargor consents to any assignment, transfer, novation or sub-participation of a Finance
Document under a Finance Document.
	 
	(b)	 	Any reference in this Deed to a Finance Party includes a new Finance Party under any Finance
Document.

	(c)	 	Any new Finance Party under any Finance Document shall enter into and deliver an accession
deed substantially in the form of Schedule 7 (Form of accession deed) to this Deed in the
capacity stated in such accession deed.
	 
	29.	 	COUNTERPARTS
	 
	 	 	This Deed may be executed in any number of counterparts. This has the same effect as if the
signatures on the counterparts were on a single copy of this Deed.
	 
	30.	 	GOVERNING LAW
	 
	 	 	This Deed is governed by Hong Kong law.
	 
	31.	 	ENFORCEMENT
	 
	31.1	 	Jurisdiction
	 
	(a)	 	The Hong Kong courts have exclusive jurisdiction to settle any dispute arising out of or in
connection with this Deed.
	 
	(b)	 	The Hong Kong courts are the most appropriate and convenient courts to settle any such
dispute arising out of or in connection with this Deed. The Chargor agrees not to argue to
the contrary and waives objection to those courts on the grounds of inconvenient forum or
otherwise in relation to proceedings in connection with this Deed.

33

 

	(c)	 	This Clause is for the benefit of the Finance Parties only. To the extent allowed by law,
the Finance Parties may take:

	 	(i)	 	proceedings in any other court; and
	 
	 	(ii)	 	concurrent proceedings in any number of jurisdictions.

	(d)	 	References in this Clause to a dispute in connection with this Deed includes any dispute as
to the existence, validity or termination of this Deed.
	 
	31.2	 	Waiver of immunity
	 
	 	 	The Chargor irrevocably and unconditionally:

	 	(a)	 	agrees not to claim any immunity from proceedings brought by a Finance Party
against it in relation to a Finance Document and to ensure that no such claim is made
on its behalf;
	 
	 	(b)	 	consents generally to the giving of any relief or the issue of any process in
connection with those proceedings; and
	 
	 	(c)	 	waives all rights of immunity in respect of it or its assets.

	31.3	 	Waiver of trial by jury
	 
	 	 	EACH PARTY WAIVES ANY RIGHT IT MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION IN
CONNECTION WITH ANY FINANCE DOCUMENT OR ANY TRANSACTION CONTEMPLATED BY ANY FINANCE
DOCUMENT. THIS DEED MAY BE FILED AS A WRITTEN CONSENT TO TRIAL BY COURT.

This Deed has been entered into as a deed on the date stated at the beginning of this Deed.

34

 

SCHEDULE 1

SECURITY ASSETS

REAL PROPERTY

NIL

SPECIFIC INTELLECTUAL PROPERTY RIGHTS

NIL

SECURITY ACCOUNTS

NIL

RELEVANT CONTRACTS

NIL

35

 

SCHEDULE 2

FORM OF RESIGNATION LETTER

[to be left blank]

The Board of Directors

[           ] (the Company)

[insert address of the registered office of the Company]

Dear Sirs,

Resignation

[I/We] hereby tender [my/our] unconditional and irrevocable resignation as [director]/[secretary]
of the Company with effect from the date of this letter. [I/We] confirm that:

	1.	 	[I/We] have no claims whatsoever against the Company or any of its subsidiaries or associated
companies (if any) on any account (whether for compensation, for loss of office, for accrued
remuneration or for fees or otherwise howsoever); and
	 
	2.	 	there is no outstanding agreement or arrangement with the Company or any of its subsidiaries
or associated companies (if any) under which the Company or any of such subsidiaries or
associated companies has or would have any obligation to [me/us] whether now or in the future
or under which [I/We] would derive any benefit.

	 	 	 	 	 	 	 
	[SIGNED, SEALED and DELIVERED

	 	 	)	 	 	 
	as a DEED by

	 	 	)	 	 	 
	[name of director/secretary]

	 	 	)	 	 	 
	in the presence of:

	 	 	)	 	 	 
	 
	 	 	 	 	 	 
	Witness:]
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	OR
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	[SEALED with the COMMON SEAL of

	 	 	)	 	 	 
	[name of director/ secretary]

	 	 	)	 	 	 
	and signed by

	 	 	)	 	 	 
	[director]

	 	 	)	 	 	 
	[director/secretary]

	 	 	)	 	 	 
	in the presence of:

	 	 	)	 	 	 

36

 

SCHEDULE 3

FORM OF WRITTEN RESOLUTION OF DIRECTORS

[           ] (the Company)

WRITTEN RESOLUTION OF ALL THE DIRECTORS made pursuant to Article [     ] of the Articles of
Association of the Company

CHANGES IN DIRECTORS

IT IS RESOLVED that the following be appointed additional directors of the Company with immediate
effect:-

[to be left blank]

IT IS RESOLVED that the resignation of the following persons as directors of the Company be
accepted with immediate effect:-

[to be left blank]

CHANGES IN SECRETARY

IT IS RESOLVED that the following person be appointed secretary of the Company with immediate
effect:-

[to be left blank]

IT IS RESOLVED that the resignation of the following person as secretary of the Company be
accepted with immediate effect:-

[to be left blank]

COMPANIES REGISTRY

IT IS RESOLVED that the above changes in directors and secretary of the Company be reported to the
Companies Registry on the requisite Return as soon as possible and for this purpose, any one
director or the new secretary of the Company be authorised to sign the said Return.

	 	 	 	 	 
	 
	 	 
	 	 

[all the directors of the Company to state their names and sign]

Date : [to be left blank]

37

 

SCHEDULE 4

FORM OF AUTHORISATION LETTER

[Date]

To :     Gold Sun Day Limited as Chargee

Dear Sirs,

Security Agreement dated 13 February 2009 between Cyber Lighting Holding Company

Limited and Gold Sun Day Limited (the Security Document)

[I/We] irrevocably authorise you or any of your officers or nominees to complete, date and put into
effect:-

	1.	 	the attached resignation letter signed by [me/us];
	 
	[2.	 	 the attached resolution signed by [me/us]; and
	 
	3.	 	any other document signed by [me/us] and delivered pursuant to the Security Document,]1

when the security constituted by the Security Document becomes enforceable in accordance with the
provisions of the Security Document.

	 	 	 	 	 	 	 
	[SIGNED, SEALED and DELIVERED

	 	 	)	 	 	 
	as a DEED by

	 	 	)	 	 	 
	[name of relevant director]

	 	 	)	 	 	 
	in the presence of

	 	 	)	 	 	 
	 
	 	 	 	 	 	 
	Witness:]
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	OR
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	[SEALED with the COMMON SEAL of

	 	 	)	 	 	 
	[                      ]

	 	 	)	 	 	 
	and signed by

	 	 	)	 	 	 
	[director]

	 	 	)	 	 	 
	[director/secretary]
	 	 	 	 	 	 
	in the presence of:]

	 	 	)	 	 	 

 

			
	1	 	delete if not applicable

38

 

SCHEDULE 5

FORMS OF LETTER FOR ACCOUNT BANK

PART 1

NOTICE TO ACCOUNT BANK

[On the letterhead of the Chargor]

To: [Account Bank]

[Date]

Dear Sirs,

Security Agreement dated 13 February 2009 between Cyber Lighting Holding Company

Limited and Gold Sun Day Limited (the Security Document)

This letter constitutes notice to you that under the Security Document we have charged (by way of a
first fixed charge) in favour of Gold Sun Day Limited (the Chargee) all our rights in respect of
any amount moneys standing to the credit of any account maintained by us with you (the Accounts).

We irrevocably instruct and authorise you to:

	(a)	 	disclose to the Chargee any information relating to any Account requested from you by the
Chargee;
	 
	(b)	 	comply with the terms of any written notice or instruction relating to any Account received
by you from the Chargee;
	 
	(c)	 	hold all sums standing to the credit of any Account to the order of the Chargee; and
	 
	(d)	 	pay or release any sum standing to the credit of any Account in accordance with the written
instructions of the Chargee.

We are not permitted to withdraw any amount from any Account without the prior written consent of
the Chargee.

We acknowledge that you may comply with the instructions in this letter without any further
permission from us.

We enclose a copy of the Security Document.

The instructions in this letter may not be revoked or amended without the prior written consent of
the Chargee.

This letter is governed by Hong Kong law.

39

 

Please confirm your agreement to the above by sending the attached acknowledgement to the Chargee
at:

	 	 	 
	Address:

	 	c/o Asia Debt Management Hong Kong Limited
	 

	 	1008 ICBC Tower
	 

	 	3 Garden Road Central
	 

	 	Hong Kong
	Fax number:

	 	+852 2147 2813
	Attention:

	 	Grace Tan / Chris Chan,

with a copy to ourselves.

Yours faithfully,

                    

(Authorised Signatory)

Cyber Lighting Holding Company Limited

40

 

PART 2

ACKNOWLEDGEMENT OF ACCOUNT BANK

[On the letterhead of the Account Bank]

	 	 	 
	To:

	 	Gold Sun Day Limited
	 
	 	 
	Copy:

	 	Cyber Lighting Holding Company Limited

[Date]

Dear Sirs,

Security Agreement dated 13 February 2009 between Cyber Lighting Holding Company

Limited and Gold Sun Day Limited (the Security Document)

We confirm receipt from Cyber Lighting Holding Company Limited (the Chargor) of a notice dated [                    ]
2009 of a charge upon the terms of the Security Document over all the rights of the
Chargor to any amount standing to the credit of any of the Chargor’s accounts with us (the
Accounts).

We confirm that we:

	(a)	 	accept the instructions contained in the notice and agree to comply with the notice;
	 
	(b)	 	have not received notice of the interest of any third party in any Account;
	 
	(c)	 	have neither claimed nor exercised, nor will claim or exercise, any security interest,
set-off, counter-claim or other right in respect of any Account; and
	 
	(d)	 	will not permit any amount to be withdrawn from any Account without your prior written
consent.

The Accounts maintained with us are:

[Specify accounts and account numbers]

This letter is governed by Hong Kong law.

Yours faithfully,

                    

(Authorised signatory)

[Account Bank]

41

 

SCHEDULE 6

FORMS OF LETTER FOR RELEVANT CONTRACTS

PART 1

NOTICE TO COUNTERPARTY

To:      [Contract party]

[Date]

Dear Sirs,

Security Agreement dated 13 February 2009 between Cyber Lighting Holding Company

Limited and Gold Sun Day Limited (the Security Document)

This letter constitutes notice to you that under the Security Document we have assigned by way of
security to Gold Sun Day Limited (the Chargee) all our rights in respect of [insert details of
Contract] (the Contract).

We confirm that:

	(a)	 	we will remain liable under the Contract to perform all the obligations assumed by us under
the Contract; and
	 
	(b)	 	none of the Chargee, its agents, any receiver or any other person will at any time be under
any obligation or liability to you under or in respect of the Contract.

We will also remain entitled to exercise all our rights, powers and discretions under the Contract,
and you should continue to give notices under the Contract to us, unless and until you receive
notice from the Chargee to the contrary stating that the security has become enforceable. In this
event, all the rights, powers and discretions will be exercisable by, and notices must be given to,
the Chargee or as it directs.

Please note that we have agreed that we will not amend or waive any provision of or terminate the
Contract without the prior consent of the Chargee.

This letter is governed by Hong Kong law.

Please acknowledge receipt of this letter by sending the attached acknowledgement to the Chargee
at:

	 	 	 
	Address:

	 	c/o Asia Debt Management Hong Kong Limited
	 

	 	1008 ICBC Tower
	 

	 	3 Garden Road Central
	 

	 	Hong Kong
	Fax number:

	 	+852 2147 2813
	Attention:

	 	Grace Tan / Chris Chan.

42

 

Yours faithfully,

                    

Cyber Lighting Holding Company Limited

(Authorised signatory)

43

 

PART 2

Acknowledgement of Counterparty

	 	 	 
	To:

	 	Gold Sun Day Limited as Chargee
	 
	 	 
	Copy:

	 	Cyber Lighting Holding Company Limited

[Date]

Dear Sirs,

We confirm receipt from Cyber Lighting Holding Company Limited (the Chargor) of a notice dated [          ]
2009 of an assignment on the terms of the Security Agreement dated 13 February 2009
of all the Chargor’s rights in respect of [insert details of the Contract] (the Contract).

We confirm that we will pay all sums due, and give notices, under the Contract as directed in that
notice.

This letter is governed by Hong Kong law.

Yours faithfully,

          
                    
          

(Authorised signatory)

[Counterparty]

44

 

SCHEDULE 7

ACCESSION DEED

	 	 	 
	To:

	 	Gold Sun Day Limited
	 
	 	 
	From:

	 	[PROPOSED NEW FINANCE PARTY]
	 
	 	 
	Copy to:

	 	CYBER LIGHTING HOLDING COMPANY LIMITED
	 
	 	 

Date: [                    ]

CYBER LIGHTING HOLDING COMPANY LIMITED

Security Agreement dated 13 February 2009

(the Security Document)

We refer to the Security Document. Words and expressions defined in the Security Document have the
same meaning when used in this Deed.

We, [name of new Party] of [address/registered office], agree to be bound by the terms of the
Security Document as a [          ].

Our contact details are as follows:

 [

].

This deed is a Finance Document.

This deed is intended to be executed as a deed and is governed by Hong Kong law.

By:

[PROPOSED NEW FINANCE PARTY]

[Execution under seal]

45

 

SIGNATORIES

Chargor

	 	 	 	 	 	 	 
	SEALED with the COMMON SEAL of

	 	 	)	 	 	 
	CYBER LIGHTING HOLDING

	 	 	)	 	 	 
	COMPANY LIMITED

	 	 	)	 	 	 
	and signed by /s/ Haifei Wang

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	in the presence of:

	 	 	)	 	 	 
	 
	 	 	 	 	 	 

Witness’ signature: /s/ Xu Tian

Witness’ address:

Witness’ name: Xu Tian

HK
Security Agreement

 

 

Chargee

	 	 	 	 	 
	 
	 	 	 	 
	GOLD SUN DAY LIMITED	 	 
	 
	 	 	 	 
	By:

	 	/s/ Grace Tan & Alexander Shaik
 

	 	 

HK
Security AgreementEX-4.16

Exhibit 4.16

ENGLISH TRANSLATION

EQUITY PLEDGE CONTRACT

DATED
FEBRUARY 13, 2009

by

CYBER POWER GROUP LIMITED

and

FINE SILICON CO., LTD

and

GOLD SUN DAY LIMITED

 

 

Equity Pledge Contract

PREAMBLE

THIS
EQUITY PLEDGE CONTRACT (the Contract) is made on _____  2009

BY AND AMONG

	(1)	 	Cyber Power Group Limited, a limited liability company incorporated in the British Virgin
Islands with its legal registered address at P.O. Box 957, Offshore Incorporations Centre,
Road Town, Tortola, British Virgin Islands (the Chargor);
	 
	(2)	 	Fine Silicon Co., Ltd, a wholly foreign-owned enterprise incorporated in the PRC with its
legal registered address at
(the Company); and
	 
	(3)	 	Gold Sun Day Limited, a limited liability company incorporated in British Virgin Islands with
its legal address at P.O. Box 3140, Road Town, Tortola, British Virgin Islands VG1110 as
chargee (the Chargee).

In this Contract, the Chargee, the Chargor and the Company are collectively referred to as the
Parties and each of them is referred to as a Party.

RECITAL:

	(1)	 	Yingli Energy (China) Co., Ltd., a wholly foreign owned company established in the PRC (the
Borrrower), entered into a credit agreement dated 24 January 2009 with the Chargee (the Credit
Agreement), whereby the Chargee intends to make available to the Borrower a loan in the amount
of up to USD80,000,000 (the Loan). The principal of the Loan shall be determined on the basis
of the amount of actual drawdown.
	 
	(2)	 	The Chargor holds 100% of equity interest in the Company’s registered capital of
USD140,000,000. The Chargor and the Borrower are under common control by the same controller
(i.e. YGE as defined under the Credit Agreement).
	 
	(3)	 	In order to ensure the full discharge of the Secured Obligations, the Chargor has agreed to
grant the Chargee security interest in connection with all of rights, title and interest over,
of and in the Charged Shares subject to terms and conditions of this Contract.

The Parties agree upon the following terms and conditions through consultation in order to
fully perform this Contract:

	1.	 	DEFINITIONS
	 
	1.1	 	In this Contract, unless the context requires otherwise:

“Approval Authority” means the Ministry of Commerce or its applicable local authority that
has issued the currently effective certificate of approval of the Company.

“Dividends” means all present and future:

	 	(a)	 	dividends and distributions of any kind received or receivable in respect of
any Charged Shares held by the Chargor in the Company;

2

 

	 	(b)	 	rights, shares, money or other assets accruing or offered by way of
redemption, bonus, option or otherwise in respect of any Charged Shares held by the
Chargor in the Company;
	 
	 	(c)	 	allotments, offers and rights accruing or offered in respect of any Charged
Shares held by the Chargor in the Company; and
	 
	 	(d)	 	other rights and assets attaching to, deriving from or exercisable by virtue
of the ownership of, Charged Shares held by the Chargor in the Company.

“Effective Date” means the date that this Contract has been approved by the Approval
Authority and registered with the Registration Authority.

“Shares” mean shares that the Chargor holds in the registered capital of the Company. At
the time when this Contract is signed, the registered capital of the Company is USD140,000,000 and
the Chargor holds 100% of shares in the Company.

“Hong Kong” means the Hong Kong Special Administrative Region of the People’s Republic of
China.

“Lien” means any lien, pledge, mortgage, security interest, claim, lease, license, charge,
option, right of first refusal, easement, servitude, transfer restriction, encumbrance or any other
similar restriction or limitation whatsoever.

“Charged Shares” mean all the equity interest held by the Chargor as a shareholder by
virtue of its USD140,000,000 capital contribution to the Company’s existing registered capital and
all the equity interest held by the Chargor by virtue of its contribution to any increase in
registered capital of the Company before the Secured Obligations are fully discharged.

“PRC” means the People’s Republic of China, and for purpose of this Contract, does not
include the Hong Kong Special Administrative Region, the Macau Special Administrative Region and
Taiwan.

“Registration Authority” means the applicable administrative authority of industries and
commerce that has issued the currently effective business license of the Company.

“Registered Capital” means all the registered capital of the Company from time to time.

“Secured Obligations” mean all the existing and future liabilities and obligations of the
Borrower owed to the Chargee under the Credit Agreement, including without limitation the repayment
of the Loan and the payment of the interest accrued thereon, overdue interest, compound interest,
indemnities, break costs, liquidated damages and other costs, expenses and payables in relation
thereto, as determined in accordance with the Credit Agreement. If the Credit Agreement is
declared void, the Secured Obligations shall be the obligations which the Borrower owes to the
Chargee under the invalid Credit Agreement, including but not limited to the repayment of the
principal, and the payment for indemnities, compensation and various expenses.

“Offshore
Account Charge” means a document dated ______ and entered into between the
Chargor and the Chargee in connection with a charge created over offshore accounts maintained in
the name of the Chargor.

“Security Account” means an account charged in favour of the Chargee in accordance with the
Offshore Account Charge.

3

 

“Material Adverse Effect” means a material adverse effect on:

	 	(a)	 	the business, prospects or financial condition of the Chargor, the Company
and its subordinates or of all of them as a whole;
	 
	 	(b)	 	the ability of the Chargor or the Company to perform its obligations under
this Contract;
	 
	 	(c)	 	the validity, enforceability or ranking of this Contract;
	 
	 	(d)	 	termination, ceassation of operations or business suspension of the Chargor,
the Company and its subordinates.

This Contract is subordinate to the Credit Agreement. Any terms used in this Contract
shall have the same meaning given to them in clause 1 of the Credit Agreement unless
defined otherwise in this Contract.

	1.2	 	The following terms are defined in the indicated clause or Schedule:

	 	 	 
	Borrower

	 	Recital (1)
	 
	 	 
	Company

	 	Recital (2)
	 
	 	 
	Contract

	 	Preamble
	 
	 	 
	Default

	 	Clause 6.1
	 
	 	 
	Loan

	 	Recital (1)
	 
	 	 
	Credit
Agreement

	 	Recital (1)
	 
	 	 
	Party
or Parties

	 	Preamble
	 
	 	 
	Chargee

	 	Preamble
	 
	 	 
	Chargor

	 	Preamble

	1.3	 	References herein to any Clause shall be construed as references to such clause under this
Contract unless the context otherwise requires.
	 
	1.4	 	References to a Party shall, where the context permits, include such Party’s successors and
permitted assigns.
	 
	1.5	 	The headings are inserted for convenience only and shall not affect the interpretation of
this Contract.
	 
	1.6	 	Unless the context requires otherwise, words importing the singular include the plural and
vice versa, and pronouns importing a gender include each of the masculine, feminine and neuter
genders.

4

 

	1.7	 	References to the knowledge, information, belief or awareness of any Person shall be deemed
to include the knowledge, information, belief or awareness such Person would have if such
Person had made reasonable inquiries.
	 
	2.	 	SECURITY INTEREST
	 
	2.1	 	Grant of Security Interest
	 
	 	 	As security for the Borrower’s full discharge of the Secured Obligations on time, the
Chargor hereby grants to the Chargee a continuing security interest of first priority in
the Charged Shares and their Dividends, which is subject to no other Liens. The Chargee
has the first priority in proceeds arising from disposal of the Charged Shares and
Dividends.
	 
	2.2	 	Share Register
	 
	 	 	The Chargor and the Company shall record such charge in the share register of the Company
at the time when this Contract is signed, and deliver to the Chargee a photocopy of the
updated share register reflecting such charge with a corporate seal of the Company affixed
thereto.
	 
	2.3	 	Approval and Registration
	 
	 	 	Within 64 days after this Contract is signed, the Chargor and the Company shall complete
all of the following approval and registration:
	 
	2.3.1	 	to obtain all relevant approval documents from the Approval Authority related to the
approval of the Security Interest granted under this Contract ; and
	 
	2.3.2	 	to register the Security Interests granted under this Contract with the Registration
Authority.
	 
	3.	 	REPRESENTATIONS AND WARRANTIES OF THE CHARGOR AND THE COMPANY
	 
	3.1	 	Representations and Warranties
	 
	 	 	The Chargor and the Company hereby represent and warrant to the Chargee that:

	 	(a)	 	each of the Chargor and the Company will deliver to the Chargee the latest
articles of association, business licence and approval certificates;
	 
	 	(b)	 	the Chargor is a limited liability company duly established and validly
existing under the laws of British Virgin Islands, and it has the full power and
authority to enter into, execute and deliver this Contract and to perform its
obligations under this Contract;
	 
	 	(c)	 	the execution and delivery by the Chargor and the Company of this Contract
and the performance by the Chargor and the Company of their respective obligations
hereunder have been respectively and duly authorized by all necessary corporate or
other action of the Chargor and the Company;
	 
	 	(d)	 	assuming the due authorization, execution and delivery hereof by the Chargee,
this Contract constitutes the legal, valid and binding obligation of the Chargor;

5

 

	 	(e)	 	the execution, delivery and performance of this Contract by the Chargor and
the Company will not (i) violate any provision of the organizational or constitutional
documents of the Chargor or the Company; (ii) require the Chargor or the Company to
obtain any consent, approval or action of, or make any filing with or giving any
notice to, any governmental authority in the Chargor’s or the Company’s country of
organization or any other person pursuant to any instrument, contract or other
agreement to which the Chargor or the Company is a party or by which the Chargor or
the Company is bound, other than any such consent, approval, action or filing that has
already duly obtained or made, or required under Section 2.3; (iii) conflict with any
of the terms and conditions of, or constitute (or with notice or lapse of time or both
constitute) a default or violation of any of the terms and conditions under, any
instrument, contract or other agreement to which the Chargor or the Company is a party
or by which the Chargor or the Company is bound; (iv) violate any order, judgment or
decree against, or binding upon, the Chargor
or the Company or upon its respective shares, properties or businesses; or (v) violate any law or regulation of the
Chargor’s or the Company’s country of organization or any other country in which it
maintains its principal office;
	 
	 	(f)	 	the Chargor is the sole legal and beneficial owner of, and has sole and valid
title to the Charged Shares, and the Charged Shares are free of any and all options to
purchase or similar rights of, or claims of, any other Person or any other Liens,
except the Security Interest created by this Contract;
	 
	 	(g)	 	the Company is a wholly foreign owned enterprise duly established and validly
existing under the laws of the PRC; the registered capital of the Company has been
fully paid off; the Charged Shares constitute the entire registered capital of the
Company, and represent all the capital contribution which the Company has received;
	 
	 	(h)	 	except for the stamp duty, no tax, fee, withholding tax and other expenses
will be payable in connection with execution, delivery and performance of this
Contract in the PRC; and
	 
	 	(i)	 	all the information related to the execution and performance of this Contract
which has been provided to the Chargee by the Chargor, the Company or their respective
agents, employees or representatives is true, complete and accurate and is not
misleading in any material respect.

	3.2	 	Repetition
	 
	 	 	Each of the representations and warranties in Clause 3.1 (other than those set out in
Clause 3.1(h)) is deemed to be made by the Chargor and the Company, by reference to the
facts and circumstances then existing, on the execution date, the Maturity Date and at all
times during the continuance of this Contract.
	 
	4.	 	UNDERTAKINGS OF THE CHARGOR AND THE COMPANY
	 
	4.1	 	No Disposal
	 
	 	 	Except as permitted under this Contract, the Chargor shall not sell, assign, transfer,
donate, pledge or otherwise encumber in any manner any of the Charged Shares and the
Dividends without the prior written consent of the Chargee.

6

 

	 	 	Except as permitted under this Contract, the Chargor and the Company shall not dispose of
any assets of value in annual aggregate exceeding 5% of the net asset value without the
prior written consent of the Chargee. The Chargor and the Company shall not expand
production capacity in connection with any ongoing project with an annual production
capacity of 3,000 tons, without the prior written consent of the Chargee.
	 
	4.2	 	No Dilution
	 
	 	 	The Chargor and the Company shall not issue any shares of stock or other securities in
addition to or in substitution for the Charged shares without the prior written consent of
the Chargee. If the Chargor increases its contribution to the registered capital of the
Company, all shares and the Dividends held by the Chargor as a result of such capital
increase shall also form part of the Charged Shares and Dividends hereunder. If any
approval from the Approval Authority or registration with the Registration Authority is
required, the Chargor and the Company undertakes to complete such approval and registration
formalities when applying for or registering the capital increase.
	 
	4.3	 	Actions Regarding Charged Shares
	 
	 	 	The Chargor and the Company shall immediately notify the Chargee in writing of the
occurrence or potential occurrence of any actions, suits, claims or legal, administrative
or arbitral proceedings or governmental inquiries, actions or investigations in relation to
the Charged Shares and the Dividends.
	 
	4.4	 	Material Adverse Effect on the Company
	 
	 	 	Neither the Chargor nor the Company shall do or omit to do any act which act or omission
would have a material adverse effect on the Charged Shares or the Security Interest created
on the Charged Shares and the Dividends by this Contract. In case of any material adverse
effect as set forth hereunder, the Chargor and the Company shall immediately notify the
Chargee in writing.
	 
	4.5	 	Defense of the Chargor and the Company
	 
	 	 	The Chargor and the Company shall defend, at their own cost, the Chargee’s rights, title,
lien and Security Interests in and to the Charged Shares and the Dividends against the
claims and demands of all Persons whosoever regarding the Charged Shares and the Dividends.
	 
	4.6	 	Further Assurance
	 
	 	 	Whenever requested by the Chargee, the Chargor and the Company shall promptly execute all
such other instruments, and promptly do all such other things, as may be necessary or
advisable in order to further and more fully vest in the Chargee all rights, interests,
powers, benefits, privileges and advantages conferred or intended to be conferred by this
Contract, or for the purpose of facilitating the full realization of the Security Interests
hereunder, including but not limited to submitting all applications to the Approval
Authority and/or the Registration Authority and providing all documents as required by such
authorities.
	 
	4.7	 	Undertakings of the Chargor in connection with Financial Indicators and the Company’s
Project Construction Schedule

7

 

	4.7.1	 	Undertakings of the Chargor in connection with Financial Indicators

	 	(a)	 	The ratio of the consolidated indebtedness to shareholders’ equity of the
Chargor will be less than or equal to 1.25;
	 
	 	(b)	 	The consolidated BVI Key Subsidiary Debt Service Coverage Ratio (as defined
in the YGE Guarantee and Undertaking Agreement listed in Schedule 2 of the Credit
Agreement) of the Chargor will be more than or equal to 1;

	4.7.2	 	Undertakings of the Chargor in connection with the Company’s Project Construction Schedule

	 	(a)	 	prior to 28 February 2009, a land grant contract will be entered into with
the land and resources bureau in connection with the land use right for the land of
phase 1 with an area of 800 mu, and the state-owned land use right certificate will be
obtained;
	 
	 	(b)	 	prior to 31 March 2009, with respect to the 3000 ton polysilicon project of
phase 1, the construction planning permit, the construction permit, the approval for
fire control and the approval for environment assessment of the third 1000 ton project
will be obtained;
	 
	 	(c)	 	within 20 months from the drawdown date of the Loan under the Credit
Agreement, the environment inspection, the fire control inspection, the production
equipment safety inspection and the construction completion inspection in respect of
the 3000 ton polysilicon project of phase 1 will be completed and the relevant title
certificate will be obtained;
	 
	 	(d)	 	within 22 months from the drawdown date of the Loan under the Credit
Agreement, the safety inspection of hazardous chemicals will be completed and the
waste discharge licence will be obtained;
	 
	 	(e)	 	within 1 month from the drawdown date of the Loan under the Credit Agreement,
design and procurement of facilities and equipment will be completed; within 9 months
from the drawdown date of the Loan, the trial run of key equipment such as the silane
system and reactors will be completed; within 10 months from the drawdown date of the
Loan, installation and trial operation of 5 Siemens reactors will be completed; within
13 months from the drawdown date of the Loan, the annual production capacity of 1,500
tons will be attained; within 16 months from the drawdown date of the Loan, the annual
production capacity of 3,000 tons will be attained.

	4.8	 	Inspection and Supervision
	 
	 	 	The Chargee is entitled to inspect on its own or appoint the independent third party
(including but not limited to technical advisors and financial advisors) to inspect the
following matters. The Chargor and the Company must comply with such inspection and provide
assistance:
	 
	4.8.1	 	to inspect financial revenue and expenditure, financial records and other information of the
Chargor and its subsidiaries;

8

 

	4.8.2	 	to inspect the development status of the ongoing 3,000 ton polysilicon project of the
Company, including but not limited to the project progress, the project quality, inspecting
whether the project progress corresponds to the budget, whether there are any technical
issues, whether the financial revenue and expenditure and financial records are reasonable,
and all the other matters relevant to such project. The Chargor and the Company shall provide
assistance. Should the Chargee or the third party appointed by it wish to photocopy relevant
documents during the inspection, the Chargor and the Company shall provide them with the
photocopies requested.

	4.9	 	No Loan
	 
	 	 	The Chargor warrants that at the time of execution of this Contract, there is no loan
provided by or borrowring to the Chargor or all of its affiliated companies, and the
Chargor and the Company undertake that the Chargor, the Company and all of their affiliated
companies will not provide any third party with loans or obtain any borrowring from any
third party in the future without the prior written consent of the Chargee.
	 
	4.10	 	No Security Provided
	 
	 	 	The Chargor and the Company warrant that at the execution of this Contract, the Chargor,
the Company and all of their affiliated companies have not provided, by any means to, any
third party with security, and undertake that the Chargor, the Company and all of their
affiliated companies will not provide, by any means, to any third party with security in
the future without the prior written consent of the Chargee.
	 
	4.11	 	No Merger, Amalgamation or Acquisition
	 
	 	 	The Chargor, the Company and all of their affiliated companies warrant that at the
execution of this Contract, they are not carrying out any merger, amalgamation or
acquisition, nor being merged, amalgamated or acquired in any form, and undertake that the
Chargor, the Company and all of their affiliated companies will not carry out any merger,
amalgamation or acquisition nor be merged, amalgamated or acquired in the future without
the prior written consent of the Chargee.
	 
	4.12	 	No Amendment to the Articles of Association and No Change of Control or Actual
Controller
	 
	 	 	The Chargor and the Company undertake that the articles of association of the Company will
not be amended without the prior written consent of the Chargee and that no change will
occur to the control or the actual controller before the Secured Obligations are fully
discharged.
	 
	4.13	 	Timely Provision of Financial Statements
	 
	 	 	Within 120 days after the end of each year, the Chargor shall provide the Chargee with a
full set of unaudited financial reports (including the balance sheet, income statement, and
cash flow statement) of the preceding year, and shall provide, within 60 days after the end
of each quarter, the Chargee with a full set of unaudited financial reports of the
preceding quarter (including the balance sheet, income statement, and cash flow statement).
	 
	 	 	Within 120 days after the end of each year, the Company shall provide the Chargee with
a full set of financial reports (including balance sheet, income statement, cash flow
statement and audit report) of the preceding year prepared in accordance with PRC

9

 

	 	 	accounting principles and audited by an accounting firm acceptable to the Chargee, and
shall provide, within 60 days after the end of each quarter, the Chargee with a full set of
unaudited financial reports of the preceding quarter (including balance sheet, income
statement, and cash flow statement) prepared in accordance with PRC accounting principles.

	4.14	 	Undertakings of Environment Protection
	 
	 	 	The Chargor and the Company shall comply with all environment protection requirements under
PRC laws and regulations and obtain all necessary approvals from the environment
authorities for all its projects. Each of the Chargor and the Company shall warrant that
it has never breached and will not breach any provisions related to environment protection
under PRC laws and regulations.
	 
	4.15	 	Compliance with Law
	 
	 	 	The Chargor and the Company shall comply with and shall not breach mandatory provisions
under laws and regulatory documents applicable to them including laws, regulations and
rules.
	 
	4.16	 	Offshore Charge Registration
	 
	 	 	Within 30 days after this Contract is signed, the Chargor shall:

	 	(a)	 	instruct its registered agent to create and maintain a Register of Charges
for the Chargor in accordance with Section 162 of the Business Companies Act 2004 of
the British Virgin Islands (the Register of Charges) and to enter particulars of the
security interests created pursuant to this Contract in the Register of Charges; and
	 
	 	(b)	 	instruct its registered agent to effect registration of this Deed at the
Registry of Corporate Affairs pursuant to Section 163 of the Business Companies Act
2004 of the British Virgin Islands.

Within 3 days from the date of receipt of the certificate of registration issued by
the Registrar of Corporate Affairs, the Chargor shall deliver or procure to be delivered to
the Chargee such certificate of registration as soon as possible.

	5.	 	RIGHTS PERTAINING TO CHARGED SHARES
	 
	5.1	 	Voting and Other rights
	 
	5.1.1	 	Subject to Section 5.1.2, except otherwise instructed by the Chargee in writing, the Chargor
shall be entitled to exercise or direct the exercise of the voting and other rights attached
to the Charged Shares as it sees fit provided that:

	 	(a)	 	it does so for a purpose not inconsistent with the Credit Agreement or any
other Finance Document; and
	 
	 	(b)	 	the exercise or failure to exercise those rights would not have an adverse
effect on the value of the Charged Shares and the Dividends and would not otherwise
prejudice the interests of the Chargee.

	5.1.2	 	Chargee’s Rights

10

 

	 	 	At any time upon occurrence of a event of default under Clause 6 hereof and/or an event of
default by the Borrower under Clause 21 of the Credit Agreement:

	 	(a)	 	the Chargee shall be entitled to exercise or direct the exercise of the
voting and other rights attached to any Charged Shares as it sees fit; and
	 
	 	(b)	 	and the Chargor and the Company shall comply or procure the compliance with
any directions of the Chargee in respect of the exercise of those rights and shall
promptly execute and/or deliver to the Chargee such forms of proxy or power of
attorney as it may require in connection with that exercise.

	5.2	 	Receiving Dividends
	 
	5.2.1	 	Whether prior to or after the Security Interests created by this Contract become
enforceable, the Company shall deposit to the Security Account such cash income as dividends
and distributions obtained from the Charged Shares. After the Security Interests created by
this Contract become enforceable, such cash income shall be immediately paid to the Chargee
upon the Chargee’s instruction.
	 
	5.2.2	 	After the Security Interests created by this Contract become enforceable, the Chargor will
direct, according to the written request of the Chargee, that any Dividends or other payments
which it or its nominee as holder thereof may be entitled to receive in respect of any of the
Charged Shares be paid to the Chargee for payment of the Secured Obligations.
	 
	5.3	 	Rights of Inspection and Supervision of the Company and the Company’s 3000-ton
Polysilicon Project
	 
	5.3.1	 	The Chargee is entitled to conduct, by itself or by relevant technicians of an independent
third party as appointed by the Chargee, onsite supervision of the Company’s ongoing 3000-ton
polysilicon project. In order to understand the status of the project, such supervision may be
conducted by taking the following steps:
	 
	5.3.1.1	 	receive status reports on the Company’s polysilicon project from the key management of the
Company;
	 
	5.3.1.2	 	review such financial documents as financial statements, accounting vouchers, accounting
books, and other relevant materials of the Company and the polysilicon project at any time;
	 
	5.3.1.3	 	to inspect the financial and capital status of the Company.
	 
	 	 	The Borrower shall cooperate with the Chargee and persons appointed by the Chargee in
connection with the above-mentioned activities.
	 
	5.3.2	 	After the Company’s 3000-ton polysilicon project commences operation (operation meaning any
production activity in connection with the project, including commissioning and partial
operation), the Chargee and persons appointed by the Chargee are entitled to review at any
time any product sales agreements. The Company shall notify the Chargee five days prior to
execution of any material product sales agreement. Material product sales agreement means
sales agreements of 100 ton or more.
	 
	6.	 	DEFAULT
	 
	6.1	 	Default Event

11

 

	 	 	The Chargor and the Company shall be deemed in default of this Contract if any of the
following default events (each as a Default) occur:

	6.1.1	 	any warranty or representation made by the Chargor and the Company hereunder is materially
untrue or erroneous; and/or the Chargor and the Company breaches any other obligation under
Clauses 2, 3, 4 or 5 hereof ; and/or there is any litigation in relation to the Charged Shares
under Clause 4.3 hereof; and/or there is any Material Adverse Effect on the Company and the
Chargor as provided under this Contract;
	 
	6.1.2	 	The Chargor or the Company ceases operation, is dissolved or subject to an order to cease
operation, bankrupt or liquidate, its business license is revoked by administration of
industry and commerce, its production safety license is revoked by safety supervision
administration, its pollution discharge license is revoked by environmental protection
administration or any material production safety accident occurs in the Company;
	 
	6.1.3	 	The Chargor or the Company is involved in any dispute, lawsuit, arbitration, administrative
proceedings or other legal proceedings or government enquiry, action or investigation or any
default under any material contract that, in reasonable opinion of the Chargee, will have
material adverse impact on the ability of the Chargor or the Company to perform its
obligations hereunder;
	 
	6.1.4	 	The Chargor or the Company directly or indirectly transfer assets of the Company.
	 
	7.	 	REALIZATION OF SECURITY INTERESTS
	 
	7.1	 	If any of the following events occur, the Chargee shall have the right to realize the
Security interests by disposal of the Charged Shares and the Dividends in any one or
combination of the means described under Clause 7.2:
	 
	7.1.1	 	In case of any event of default under Clause 21 of the Credit Agreement, the Chargee
notifies the Borrower in writing that the Secured Obligations become immediately due and
payable in accordance with clause 21.2 of the Credit Agreement, and the Borrower fails to
immediately and fully discharge the Secured Obligations after the said written notice from the
Chargee is delivered to the Borrower;
	 
	7.1.2	 	The Borrower fails to prepay the Loan when it is required to prepay such Loan in accordance
with Clauses 11.2 to11.4 of the Credit Agreement.
	 
	7.1.3	 	The Borrower fails to discharge the Secured Obligations as agreed upon maturity of the Loan;
	 
	7.1.4	 	The Chargor agrees to use the proceeds from disposal of the Security Interests to discharge
the Secured Obligations in priority;
	 
	7.1.5	 	Other circumstances where the Chargee has the right to exercise the Security Interests in
accordance with PRC laws and regulations.
	 
	7.2	 	Means of realization of Security Interests
	 
	 	 	The Chargee may realize the Security Interests by any or combination of the following
means:

12

 

	7.2.1	 	To require the Chargor and the Company to directly pay to the Chargee the Dividends in cash
payable to the Chargee or already paid to the Chargee in accordance with Clause 5.2 hereof;
	 
	7.2.2	 	Dispose the Charged Shares by auction or sale and get repaid in priority from the proceeds
of such auction or sale;
	 
	7.2.3	 	The Charged Shares are transferred to the Chargee at a price agreed by the two Parties,
which, after first being set off against the Secured Obligations, will be paid to the Chargor
(if any balance);
	 
	7.2.4	 	To dispose of the Charged Shares by other means permitted under PRC laws and regulations and
to be repaid in priority from the proceeds of such disposal.
	 
	8.	 	PROVISION OF DOCUMENTS AND IMPLEMENTATION OF ACTION
	 
	8.1	 	When the Chargee realizing the Security Interests, the Chargor and the Company shall provide
the Chargee or its representative with documents necessary or desirable for realization of the
Security Interests as required by the Chargee. The Chargor and the Company shall promptly
execute all documents and take all actions necessary or desirable for realization of the
Security Interests in accordance with Clause 7 hereof. Notwithstanding the general provisions
above, the Chargor and the Company shall endeavor to complete or assist the Chargee in
completing all approval and/or registration formalities with governmental authorities
(including but not limited to the Approval Authority and the Registration Authority) in
respect of the disposal of the Charged Shares.
	 
	9.	 	INDEMNITIES
	 
	 	 	The Chargor shall indemnify the Chargee against all loss, liabilities, damages, expenses
and costs incurred by the Chargee arising from the realization of the Security Interests
under Clause 7 hereof or performance of the terms and conditions of this Contract, and all
litigation, legal proceedings, claims, demands, expenses and costs potentially incurred,
suffered or generated by the Chargee due to failure of the Chargor or the Company to
perform or comply with any of undertakings and provisions as set out in this Contract and
any act or omission of the Chargor or the Company in connection with the Shares in any
respect, unless such loss, liabilities, damages, expenses and costs are caused by the
Chargor’s wilful default, bad faith or wilful misconduct.
	 
	10.	 	EFFECTIVENESS AND TERMINATION
	 
	10.1	 	Term
	 
	 	 	This Contract shall become effective on the date when the Security Interests are recorded
in the register of members of the Company and remain effective until the earlier of (i) the
discharge in full of the Secured Obligations, or (ii) the completion of the disposal of the
Charged Shares in accordance with Clause 7 and being repaid in priority from the proceeds
of such disposal.
	 
	10.2	 	Effectiveness of Security interests 
	 
	 	 	The Security Interests created by this Contract shall become effective from the Effective
Date.

13

 

	10.3	 	Release
	 
	 	 	Upon the discharge in full of the Secured Obligations, the Security Interests created by
this Contract shall be terminated, and the Chargor, the Chargee and the Company shall enter
into such documents or take such acts as may be necessary to revise the Company’s register
of members and release the charge created hereunder. The Chargor and the Company shall (if
applicable) file such revised register with the Registration Authority and carry out all
other procedures for the release of the Security Interest over the Charged Shares.
	 
	11.	 	GOVERNING LAW AND DISPUTE RESOLUTION
	 
	11.1	 	Governing Law
	 
	 	 	The execution, validity, interpretation and performance of and resolution of disputes under
this Contract shall be governed by the PRC laws and regulations.
	 
	11.2	 	Dispute Resolution
	 
	 	 	In the event of any dispute with respect to the interpretation and performance of the
provisions of this Contract, the Parties shall negotiate in good faith to resolve the
dispute. In the event the Parties fail to reach an agreement through negotiations, any
Party may bring lawsuit before a competent court in Hebei Province.
	 
	12.	 	MISCELLANEOUS
	 
	12.1	 	Communications
	 
	12.1.1	 	Notices: All notices or other communication in connection with the performance of this
Contract which shall be given in writing shall be deemed delivered at the time indicated
below:

	 	(a)	 	in the case of a letter, at the time of actual receipt, or where it is not
possible to confirm the time of actual receipt, at the time of receipt as indicated by
the postmark;
	 
	 	(b)	 	in the case of a facsimile transmission, at the time of the generation of a
transmission report confirming the recipient’s facsimile number, number of pages
transmitted, and the successful conclusion of the transmission.

	12.1.2	 	Address:

	 	 	 
	 

	 	For the Chargor:
	 

	 	722 Cui Yuan Street, Baoding, Hebei Province
	 

	 	Postal code: 071051
	 

	 	Tel: +86-0312-8922599
	 

	 	Fax: +86-0312-8922500
	 
	 	 
	 

	 	For the Chargee:
	 

	 	c/o Asia Debt Management Hong Kong Limited
	 

	 	1008 ICBC Tower, 3 Garden Road Central, Hong Kong
	 

	 	Attention: Grace Tan/ Chris Chan
	 

	 	Tel: +852-2536-4567

14

 

	 	 	 
	 

	 	Fax: +852-2147-2183
	 
	 	 
	 

	 	For the Company:
	 

	 	722 Cui Yuan Street, Baoding, Hebei Province
	 

	 	Postal code: 071051
	 

	 	Tel: +86-0312-8922599
	 

	 	Fax: +86-0312-8922500

	12.1.3	 	Electronic communications: Except as required to be made in writing hereunder, any
communication may be notified to the other Party via electronic mail, the respective email
address of each of the Parties as follows:

	 	 	 	 	 
	 

	 	Chargor:
	 	Attention: Li Zongwei; Email
address: bryan_li@yinglisolar.com
	 
	 	 	 	 
	 

	 	Company:
	 	Attention: Li Zongwei; Email
address: bryan_li@yinglisolar.com
	 
	 	 	 	 
	 

	 	Chargee:
	 	Attention: Chen Meizhi; Email
address: gt@admcap.com
	 
	 	 	 	 
	 

	 	 	 	Attention: Chen Peiying; Email
address: cc@admcap.com

Where a notice is given via electronic mail, it shall only be valid if it is received by
the recipient party in a readable format.

	12.1.4	 	Any change to the address or facsimile number or email address of any Party shall be
promptly notified to the other Parties. The Party with the obligation to give such notice
shall be liable for any consequences arising from the failure to issue such notice.
	 
	12.2	 	Confidentiality
	 
	 	 	The Parties acknowledge that all information exchanged in connection with this Contract,
whether orally or in writing, is confidential information and each Party shall keep all
such information confidential and without prior written consent of the other Parties, shall
not disclose any of such information to any third party, except:

	 	(a)	 	such information is in the public domain other than as a result of disclosure
by the Party receiving such information;
	 
	 	(b)	 	such disclosure is required by applicable laws or any rule or regulation of
any stock exchange;
	 
	 	(c)	 	any Party shall keep confidential any information provided to such Party by
the other Parties (or other persons on behalf of other Parties) in connection with
this Contract, except that a Party has the right to disclose the following
information:

	 	(i)	 	any information made publicly available other than as a
result of a breach of this Clause by such Party;
	 
	 	(ii)	 	any information in respect of any legal or arbitration
proceedings;
	 
	 	(iii)	 	any disclosure required under any law or regulation;
	 
	 	(iv)	 	any disclosure to the government, bank, tax or other
regulatory authority;
	 
	 	(v)	 	any disclosure to its professional consultant;

15

 

	 	(vi)	 	any disclosure to any rating agency;
	 
	 	(vii)	 	any disclosure within the scope permitted under paragraph (d) below;
	 
	 	(viii)	 	any disclosure to another group member; or
	 
	 	(ix)	 	any disclosure agreed by the relevant party.

	 	(d)	 	where the Chargee enters into (or may enter into) any transfer, share
participation or hedge agreement in any form in connection with this Contract (or any
other transaction in respect of which monies are payable in accordance with this
Contract) with (or through) an affiliate or any person (third party), the Chargee may
disclose to such third party:

	 	(i)	 	copies of this Contract; and
	 
	 	(ii)	 	any information obtained by the Chargee in accordance with or
in respect of this Contract,

provided that, prior to receipt of any confidential information, such third party
shall enter into an agreement with the Chargee, pursuant to which it agrees to keep
such information confidential in accordance with this Clause as if such third party
were the Chargee.

	 	(e)	 	This Clause shall supersede any confidentiality undertakings by a Party
before it becomes a party to this Contract.

	12.3	 	Severability
	 
	 	 	If any term or other provision of this Contract is invalid, illegal or incapable of being
enforced by any law or public policy, all other terms and provisions of this Contract shall
nevertheless remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially adverse to
any Party. Upon such determination that any term or other provision is invalid, illegal or
incapable of being enforced, the Parties hereto shall negotiate in good faith to modify
this Contract so as to effect the original intent of the Parties as closely as possible in
an acceptable manner to enable the transactions contemplated hereby are consummated as
originally contemplated to the greatest extent possible.
	 
	12.4	 	Expenses
	 
	 	 	The Chargor shall pay all reasonable costs and disbursements of and incidental to this
Contract, provided that if the Chargor intentionally or wilfully breaches this Contract,
the Chargee shall be indemnified by the Chargor for all costs and disbursements related to
such breach. The Chargor shall also pay and shall bear any tax liability imposed on the
Parties which arises out of or in connection with this Contract.
	 
	12.5	 	Waiver
	 
	 	 	No failure or delay by any Party in exercising any right, power or remedy under this
Contract shall operate as a waiver thereof, nor shall any single or partial exercise of the
same preclude any further exercise thereof or the exercise of any other right, power or
remedy. Without limiting the foregoing, no waiver by any Party of any breach by the

16

 

	 	 	other Party of any provision hereof shall be deemed to be a waiver of any subsequent breach
of that or any other provision hereof.

	12.6	 	Successors and Assigns
	 
	 	 	This Contract shall be binding upon the Parties, their respective successors and permitted
assigns.
	 
	12.7	 	Survival
	 
	 	 	The provisions of this Contract (including without limitation the warranties in Section 3),
insofar as the same shall not have been fully performed on the date of execution hereof,
shall remain in full force and effect after the date of execution of this Contract.
	 
	12.8	 	Further Assurances
	 
	 	 	Each of the Parties agrees to expeditiously execute such documents and perform such further
acts as may be reasonably required or desirable to carry out or to perform the provisions
and purposes of this Contract.
	 
	12.9	 	Amendment
	 
	 	 	This Contract may not be amended, modified or supplemented except by a written instrument
executed by each of the Parties.
	 
	12.10	 	Language
	 
	 	 	This Contract is written in Chinese in nine copies, the Chargee holding four copies, the
Chargor and the Company holding five copies.

17

 

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

Cyber Power Group Limited

Signed by: /s/ Zongwei Li

Name: Zongwei Li

Title:

Gold Sun Day Limited

Signed by: /s/ Grace Tan & Alexander Shaik

Name: Grace Tan & Alexander Shaik

Title:

Fine Silicon Co., Ltd.

Signed by: /s/ Zongwei Li

Name: Zongwei Li

Title:

18

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