Exhibit 10.7
SHARE PLEDGE AGREEMENT
This Share Pledge Agreement (this "Agreement") has been executed by and
among the following parties on 23September 2010 in Beijing, the People's
Republic of China ("China" or the "PRC"):
PARTY A: ARKI (BEIJING) E-COMMERCE TECHNOLOGY CO., LTD. (hereinafter "Pledgee")
Address: No.15 # 0000, Xxxxx Xxxxxxx Xxxxx, Xx.00, Xxxxxxx Xxxx, Xxxxxxxx
Xxxxxxxx, Xxxxxxx
PARTY B: GAO FEI (hereinafter "Pledgor")
ID No.: 210802197904074019
PARTY C: AMERICA ARKI NETWORKSERVICE BEIJING CO., LTD.
Address: Xx.00X&00, Xxxxx 00, Xx.00, Xxxxxxx Xxxx, Xxxxxxxx Xxxxxxxx, Xxxxxxx
In this Agreement, each of Pledgee, Pledgor and Party C shall be referred
to as a "Party" respectively, and they shall be collectively referred to as the
"Parties".
WHEREAS:
1. Pledgor is a citizen of China, who became a shareholder of Party C on
August 26, 2010 and holds 50% of the equity interest in Party C. Party C is
a limited liability company registered in Beijing, China engaging in the
business of internet information service. Party C acknowledges the
respective rights and obligations of Pledgor and Pledgee under this
Agreement, and intends to provide any necessary assistance in registering
the Pledge;
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2. Pledgee is a wholly foreign-owned enterprise registered in China. Pledgee
and Party C partially owned by Pledgor have executed an Exclusive Business
Cooperation Agreement on 23September 2010 and Pledgee and Pledgor have
executed a Loan Agreement on 23August 2010;
3. To ensure that Party C fully performs its obligations under the Exclusive
Business Cooperation Agreement and pay the consulting and service fees
thereunder to the Pledgee when the same becomes due, and Pledgor fully
performs its obligations under the Loan Agreement and repay the loan
thereunder according to the Loan Agreement, Pledgor hereby pledges to the
Pledgee all of the equity interest he holds in Party C as security for
payment of the consulting and service fees by Party C under the Business
Cooperation Agreement.
To perform the provisions of the Business Cooperation Agreement, the
Parties have mutually agreed to execute this Agreement upon the following
terms.
1. DEFINITIONS
Unless otherwise provided herein, the terms below shall have the following
meanings:
1.1 Pledge: shall refer to the security interest granted by Pledgor to Pledgee
pursuant to Article 2 of this Agreement, i.e., the right of Pledgee to be
compensated on a preferential basis with the conversion, auction or sales
price of the Equity Interest.
1.2 Equity Interest: shall refer to all of the equity interest lawfully now
held and hereafter acquired by Pledgor in Party C.
1.3 Term of Pledge: shall refer to the term set forth in Section 3.2 of this
Agreement.
1.4 Business Cooperation Agreement: shall refer to the Exclusive Business
Cooperation Agreement executed by and between Party C and Pledgee on
23September2010.
1.5 Loan Agreement: shall refer to the loan agreement executed by and between
the Pledgor and Pledgee on 23August 2010.
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1.6 Event of Default: shall refer to any of the circumstances set forth in
Article 7 of this Agreement.
1.7 Notice of Default: shall refer to the notice issued by Pledgee in
accordance with this Agreement declaring an Event of Default.
2. THE PLEDGE
As collateral security for the prompt and complete payment and performance
when due (whether at stated maturity, by acceleration or otherwise) of any
or all the payments due by Party C, including without limitation the
consulting and services fees payable to the Pledgee under the Business
Cooperation Agreement, as well as the repayment obligation of Pledgor under
the Loan Agreement, Pledgor hereby pledges to Pledgee a first security
interest in all of Pledgor's right, title and interest, whether now owned
or hereafter acquired by Pledgor, in the Equity Interest of Party C.
3. TERM OF PLEDGE
3.1 The Pledge shall become effective on such date when the pledge of the
Equity Interest contemplated herein has been registered with relevant
administration for industry and commerce (the "AIC"). The Pledge shall be
continuously valid until all payments due under the Business Cooperation
Agreement and the loan under the Loan Agreement have been fulfilled or
repaid by Party C or its subsidiaries. Pledgor and Party C shall (1)
register the Pledge in the shareholders' register of Party C within 3
business days following the execution of this Agreement, and (2) submit
this Agreement or other form of the Agreement as required by the AIC to the
AIC for application of the registration of the Pledge of the Equity
Interest contemplated herein within 10 business days following the
execution of this Agreement. Pledgor and Party C shall submit all necessary
documents and complete all necessary procedures, as required by the PRC
laws and regulations and the relevant AIC, to ensure that the Pledge of the
Equity Interest shall be registered with the AIC as soon as possible after
filing.
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3.2 During the Term of Pledge, in the event Party C fails to pay the exclusive
consulting or service fees in accordance with the Business Cooperation
Agreement or fails to repay the loan under the Loan Agreement, Pledgee
shall have the right, but not the obligation, to dispose of the Pledge in
accordance with the provisions of this Agreement.
4. CUSTODY OF RECORDS FOR EQUITY INTEREST SUBJECT TO PLEDGE
4.1 During the Term of Pledge set forth in this Agreement, Pledgor shall
deliver to Pledgee's custody the capital contribution certificate for the
Equity Interest and the shareholders' register containing the Pledge within
one week from the execution of this Agreement. Pledgee shall have custody
of such items during the entire Term of Pledge set forth in this Agreement.
4.2 Pledgee shall have the right to collect dividends generated by the Equity
Interest during the Term of Pledge.
5. REPRESENTATIONS AND WARRANTIES OF PLEDGOR
5.1 Pledgor is the sole legal and beneficial owner of the Equity Interest.
5.2 Pledgee shall have the right to dispose of and transfer the Equity Interest
in accordance with the provisions set forth in this Agreement.
5.3 Except for the Pledge, Pledgor has not placed any security interest or
other encumbrance on the Equity Interest.
6. COVENANTS AND FURTHER AGREEMENTS OF PLEDGOR
6.1 Pledgor hereby covenants to the Pledgee, that during the term of this
Agreement, Pledgor shall:
6.1.1not transfer the Equity Interest, place or permit the existence of any
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security interest or other encumbrance on the Equity Interest, without
the prior written consent of Pledgee, except for the performance of
the Exclusive Option Agreement executed by Pledgor, Pledgee and Party
C;
6.1.2comply with the provisions of all laws and regulations applicable to
the pledge of rights, and within 5 days of receipt of any notice,
order or recommendation issued or prepared by relevant competent
authorities regarding the Pledge, shall present the aforementioned
notice, order or recommendation to Pledgee, and shall comply with the
aforementioned notice, order or recommendation or submit objections
and representations with respect to the aforementioned matters upon
Pledgee's reasonable request or upon consent of Pledgee;
6.1.3promptly notify Pledgee of any event or notice received by Pledgor
that may have an impact on Pledgee's rights to the Equity Interest or
any portion thereof, as well as any event or notice received by
Pledgor that may have an impact on any guarantees and other
obligations of Pledgor arising out of this Agreement.
6.2 Pledgor agrees that the rights acquired by Pledgee in accordance with this
Agreement with respect to the Pledge shall not be interrupted or harmed by
Pledgor or any heirs or representatives of Pledgor or any other persons
through any legal proceedings.
6.3 To protect or perfect the security interest granted by this Agreement for
payment of the consulting and service fees under the Business Cooperation
Agreement, Pledgor hereby undertakes to execute in good faith and to cause
other parties who have an interest in the Pledge to execute all
certificates, agreements, deeds and/or covenants required by Pledgee.
Pledgor also undertakes to perform and to cause other parties who have an
interest in the Pledge to perform actions required by Pledgee, to
facilitate the exercise by Pledgee of its rights and authority granted
thereto by this Agreement, and to enter into all relevant documents
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regarding ownership of Equity Interest with Pledgee or designee(s) of
Pledgee (natural persons/legal persons). Pledgor undertakes to provide
Pledgee within a reasonable time with all notices, orders and decisions
regarding the Pledge that are required by Pledgee.
6.4 Pledgor hereby undertakes to comply with and perform all guarantees,
promises, agreements, representations and conditions under this Agreement.
In the event of failure or partial performance of its guarantees, promises,
agreements, representations and conditions, Pledgor shall indemnify Pledgee
for all losses resulting therefrom.
7. EVENT OF BREACH
7.1 The following circumstances shall be deemed Event of Default:
7.1.1Party C fails to pay in full any of the consulting and service fees
payable under the Business Cooperation Agreement or breaches any other
obligations of Party C thereunder;
7.1.2Anyrepresentation or warranty by Pledgor in Article 5 of this
Agreement contains material misrepresentations or errors, and/or
Pledgor violates any of the warranties in Article 5 of this Agreement;
7.1.3Pledgor and Party C fail to register the Pledge in the shareholders'
register of Party C or to complete Pledge registration stipulated in
Section 3.1;
7.1.4 Pledgor or Party C breach any provisions of this Agreement;
7.1.5Except as expressly stipulated in Section 6.1.1, Pledgor transfers or
purports to transfer or abandons the Equity Interest pledged or
assigns the Equity Interest pledged without the written consent of
Pledgee;
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7.1.6Any of Pledgor's own loans, guarantees, indemnifications, promises or
other debt liabilities to any third party or parties (1) become
subject to a demand of early repayment or performance due to default
on the part of Pledgor; or (2) become due but are not capable of being
repaid or performed in a timely manner;
7.1.7Any approval, license, permit or authorization of government agencies
that makes this Agreement enforceable, legal and effective is
withdrawn, terminated, invalidated or substantively changed;
7.1.8The promulgation of applicable laws renders this Agreement illegal or
renders it impossible for Pledgor to continue to perform its
obligations under this Agreement;
7.1.9Adverse changes in properties owned by Pledgor, which lead Pledgee to
believe that that Pledgor's ability to perform its obligations under
this Agreement has been affected;
7.1.10 The successor or custodian of Party C is capable of only partially
perform or refuses to perform the payment obligations under the
Business Cooperation Agreement;
7.1.11 Pledgor fails to repay the loan according to the Loan Agreement or
breaches any other obligations of Pledgor thereunder; and
7.1.12 Any other circumstances occur where Pledgee is or may become unable
to exercise its right with respect to the Pledge in accordance with
the relevant laws and regulations.
7.2 Upon notice or discovery of the occurrence of any circumstances or event
that may lead to the aforementioned circumstances described in Section 7.1,
Pledgor shall immediately notify Pledgee in writing accordingly.
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7.3 Unless an Event of Default set forth in this Section 7.1 has been
successfully resolved to Pledgee's satisfaction, Pledgee may issue a Notice
of Default to Pledgor in writing upon the occurrence of the Event of
Default or at any time thereafter and demand that Pledgor immediately pay
all outstanding payments due under the Business Cooperation Agreement and
all other payments due to Pledgee, and/or dispose of the Pledge in
accordance with the provisions of Article 8 of this Agreement.
8. EXERCISE OF PLEDGE
8.1 Prior to the full payment of the consulting and service fees described in
the Business Cooperation Agreement and the loan described in the Loan
Agreement, without the Pledgee's written consent, Pledgor shall not assign
the Pledge or the Equity Interest in Party C.
8.2 Pledgee may issue a Notice of Default to Pledgor when exercising the
Pledge.
8.3 Subject to the provisions of Section 7.3, Pledgee may exercise the right to
enforce the Pledge concurrently with the issuance of the Notice of Default
in accordance with Section 8.2 or at any time after the issuance of the
Notice of Default. Once Pledgee elects to enforce the Pledge, Pledgor shall
cease to be entitled to any rights or interests associated with the Equity
Interest.
8.4 In the event of default, Pledgee is entitled to dispose of the Equity
Interest pledged, to the extent permitted and in accordance with applicable
laws, without obligation to account to Pledgor for proceeds of disposition
and Pledgor hereby waives any rights it may have to demand any such
accounting from Pledgee. Likewise, in such circumstance Pledgor shall have
no obligation to Pledgee for any deficiency remaining after such
disposition of the Equity Interest pledged.
8.5 When Pledgee disposes of the Pledge in accordance with this Agreement,
Pledgor and Party C shall provide necessary assistance to enable Pledgee to
enforce the Pledge in accordance with this Agreement.
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9. ASSIGNMENT
9.1 Without Pledgee's prior written consent, Pledgor shall not have the right
to assign or delegate its rights and obligations under this Agreement.
9.2 This Agreement shall be binding on Pledgor and its successors and permitted
assigns, and shall be valid with respect to Pledgee and each of its
successors and assigns.
9.3 At any time, Pledgee may assign any and all of its rights and obligations
under the Business Cooperation Agreement and/or Loan Agreement to its
designee(s) (natural/legal persons), in which case the assigns shall have
the rights and obligations of Pledgee under this Agreement, as if it were
the original party to this Agreement. When the Pledgee assigns the rights
and obligations under the Business Cooperation Agreement, upon Pledgee's
request, Pledgor shall execute relevant agreements or other documents
relating to such assignment.
9.4 In the event of a change in Pledgee due to an assignment, Pledgor shall, at
the request of Pledgee, execute a new pledge agreement with the new pledgee
on the same terms and conditions as this Agreement.
9.5 Pledgor shall strictly abide by the provisions of this Agreement and other
contracts jointly or separately executed by the Parties hereto or any of
them, including the Exclusive Option Agreement and the Power of Attorney
granted to Pledgee, perform the obligations hereunder and thereunder, and
refrain from any action/omission that may affect the effectiveness and
enforceability thereof. Any remaining rights of Pledgor with respect to the
Equity Interest pledged hereunder shall not be exercised by Pledgor except
in accordance with the written instructions of Pledgee.
10. TERMINATION
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Upon the full payment of the consulting and service fees under the Business
Cooperation Agreement and loan under the Loan Agreement, and upon
termination of Party C's obligations under the Business Cooperation
Agreement and the Loan Agreement, this Agreement shall be terminated, and
Pledgee shall then cancel or terminate this Agreement as soon as reasonably
practicable.
11. HANDLING FEES AND OTHER EXPENSES
All fees and out of pocket expenses relating to this Agreement, including
but not limited to legal costs, costs of production, stamp tax and any
other taxes and fees, shall be borne by Party C.
12. CONFIDENTIALITY
The Parties acknowledge that the existence and the terms of this Agreement
and any oral or written information exchanged between the Parties in
connection with the preparation and performance this Agreement are regarded
as confidential information. Each Party shall maintain confidentiality of
all such confidential information, and without obtaining the written
consent of the other Party, it shall not disclose any relevant confidential
information to any third parties, except for the information that: (a) is
or will be in the public domain (other than through the receiving Party's
unauthorized disclosure); (b) is under the obligation to be disclosed
pursuant to the applicable laws or regulations, rules of any stock
exchange, or orders of the court or other government authorities; or (c) is
required to be disclosed by any Party to its shareholders, investors, legal
counsels or financial advisors regarding the transaction contemplated
hereunder, provided that such shareholders, investors, legal counsels or
financial advisors shall be bound by the confidentiality obligations
similar to those set forth in this Section. Disclosure of any confidential
information by the staff members or agencies hired by any Party shall be
deemed disclosure of such confidential information by such Party, which
Party shall be held liable for breach of this Agreement. This Section shall
survive the termination of this Agreement for any reason.
13. GOVERNING LAW AND RESOLUTION OF DISPUTES
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13.1 The execution, effectiveness, construction, performance, amendment and
termination of this Agreement and the resolution of disputes hereunder
shall be governed by the laws of China.
13.2 In the event of any dispute with respect to the construction and
performance of this Agreement, the Parties shall first resolve the dispute
through friendly negotiations. In the event the Parties fail to reach an
agreement on the dispute within 30 days after either Party's request to the
other Parties for resolution of the dispute through negotiations, either
Party may submit the relevant dispute to the China International Economic
and Trade Arbitration Commission for arbitration, in accordance with its
Arbitration Rules. The arbitration shall be conducted in Beijing, and the
language used in arbitration shall be Chinese. The arbitration award shall
be final and binding on all Parties.
13.3 Upon the occurrence of any disputes arising from the construction and
performance of this Agreement or during the pending arbitration of any
dispute, except for the matters under dispute, the Parties to this
Agreement shall continue to exercise their respective rights under this
Agreement and perform their respective obligations under this Agreement.
14. NOTICES
14.1 All notices and other communications required or permitted to be given
pursuant to this Agreement shall be delivered personally or sent by
registered mail, postage prepaid, by a commercial courier service or by
facsimile transmission to the address of such party set forth below. A
confirmation copy of each notice shall also be sent by E-mail. The dates on
which notices shall be deemed to have been effectively given shall be
determined as follows:
14.1.1 Notices given by personal delivery, by courier service or by
registered mail, postage prepaid, shall be deemed effectively given on
the date of receipt or refusal at the address specified for notices.
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14.1.2 Notices given by facsimile transmission shall be deemed effectively
given on the date of successful transmission (as evidenced by an
automatically generated confirmation of transmission).
14.2 For the purpose of notices, the addresses of the Parties are as follows:
Party A: Arki (Beijing) E-commerce Technology Co., Ltd.
Address: Xxxx 000, Xxxxxxxx Xx.00, Xxxxx Central Place, Xx.00,
Xxxxxxx Xxxx, Xxxxxxxx Xxxxxxxx, Xxxxxxx
Facsimile: 010-65305285
Party B: Gao Fei
Address: Xxxx 000, Xxxxxxxx Xx.00, Xxxxx Central Place, Xx.00,
Xxxxxxx Xxxx, Xxxxxxxx Xxxxxxxx, Xxxxxxx
Facsimile: 010-65305285
Party C: America Arki Networkservice Beijing Co., Ltd.
Address: 03B&05B, Floor 25, Xx.00, Xxxxxxx Xxxx, Xxxxxxxx Xxxxxxxx,
Xxxxxxx
Facsimile: 010-65305285
14.3 Any Party may at any time change its address for notices by a notice
delivered to the other Parties in accordance with the terms hereof.
15. SEVERABILITY
In the event that one or several of the provisions of this Contract are
found to be invalid, illegal or unenforceable in any aspect in accordance
with any laws or regulations, the validity, legality or enforceability of
the remaining provisions of this Contract shall not be affected or
compromised in any respect. The Parties shall strive in good faith to
replace such invalid, illegal or unenforceable provisions with effective
provisions that accomplish to the greatest extent permitted by law and the
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intentions of the Parties, and the economic effect of such effective
provisions shall be as close as possible to the economic effect of those
invalid, illegal or unenforceable provisions.
16. ATTACHMENTS
The attachments set forth herein shall be an integral part of this
Agreement.
17. EFFECTIVENESS
17.1 Any amendments, changes and supplements to this Agreement shall be in
writing and shall become effective upon completion of the governmental
filing procedures (if applicable) after the affixation of the signatures or
seals of the Parties.
17.2 This Agreement is written in Chinese and English in three copies. Pledgor,
Pledgee and Party C shall hold one copy respectively. Each copy of this
Agreement shall have equal validity. In case there is any conflict between
the Chinese version and the English version, the Chinese version shall
prevail.
17.3 This Agreement constitutes the entire agreement between the Parties hereto,
and supersedes all prior discussions, negotiations and agreements among
them, with respect to the subject matter of this Agreement.
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IN WITNESS WHEREOF, the Parties have caused their authorized
representatives to execute this Share Pledge Agreement as of the date first
above written.
Party A: Arki (Beijing) E-commerce Technology Co., Ltd.
By: /s/ Xxx Xxxxxxx
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Name: Xxx Xxxxxxx
Title: Legal Representative
Party B: Gao Fei
By: /s/ Gao Fei
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Party C: America Arki Networkservice Beijing Co., Ltd.
By: /s/ Gao Fei
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Name: Gao Fei
Title: Legal Representative
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ATTACHMENTS:
1. Shareholders' register of AMERICA ARKI NETWORKSERVICE BEIJING CO., LTD;
2. The Capital Contribution Certificate for the Formation of AMERICA ARKI
NETWORKSERVICE BEIJING CO., LTD;
3. Exclusive Business Cooperation Agreement.
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