UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported):

July 31, 2019

 

Future FinTech Group Inc.

(Exact name of registrant as specified in its charter)

 

Florida   000-34502   98-0222013
(State or other jurisdiction
of incorporation)
  (Commission File Number)   (IRS Employer
Identification No.)

 

23F, China Development Bank Tower,

No. 2, Gaoxin 1st Road, Xi’an, China 710075

(Address of principal executive offices, including zip code)

 

(86-29) 8187-8277

(Registrant’s telephone number, including area code)

 

N/A

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange
on which registered
Common Stock, par value $0.001 per share   FTFT   Nasdaq Stock Market

 

 

 

 

 

 

Item 1.01 Entry into a Material Definitive Agreement

  

On July 31, 2019, Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd., (“CCM Tianjin”), a wholly owned subsidiary of Future FinTech Group Inc. (the “Company”), Chain Cloud Mall E-commerce (Tianjin) Co., Ltd., a limited liability company incorporated under the laws of the China (the “E-commerce Tianjin”), and Mr. Zeyao Xue and Mr. Kai Xu, citizens of China and shareholders of E-commerce Tianjin, entered into the following agreements, or collectively, the “Variable Interest Entity Agreements” or “VIE Agreements,” pursuant to which CCM Tianjin has contractual rights to control and operate the business of E-commerce Tianjin (the “VIE”).

 

Pursuant to Chinese law and regulations, a foreign owned enterprise cannot apply for and hold a license for operation of certain e-commerce businesses, the category of business which the Company plans to expand in China. CCM Tianjin is an indirectly wholly foreign owned enterprise of the Company. In order to comply with Chinese law and regulations, CCM Tianjin agreed to provide E-commerce Tianjin an Exclusive Operation and Use Rights Authorization to operate and use the Chain Cloud Mall System owned by CCM Tianjin.

 

E-commerce Tianjin was incorporated by Mr. Zeyao Xue and Mr. Kai Xu solely for the purpose of holding the operation license of the Chain Cloud Mall System. Mr. Zeyao Xue is a major shareholder of the Company and the son of Mr. Yongke Xue, our Chairman and Chief Executive Officer. Mr. Kai Xu is the Chief Operating Officer of the Company.

 

The VIE Agreements are as follows:

 

1) Exclusive Technology Consulting and Service Agreement by and between CCM Tianjin and E-commerce Tianjin. Pursuant to the Exclusive Technology Consulting and Service Agreement, CCM Tianjin agreed to act as the exclusive consultant of E-commerce Tianjin and provide technology consulting and services to E-commerce Tianjin. In exchange, E-commerce Tianjin agreed to pay CCM Tianjin a technology consulting and service fee, the amount of which is to be equivalent to the amount of net profit before tax of E-commerce Tianjin, payable on a quarterly basis after making up losses of previous years (if necessary) and deducting necessary costs, expenses and taxes related to the business operations of E-commerce Tianjin. Without the prior written consent of CCM Tianjin, E-commerce Tianjin may not accept the same or similar technology consulting and services provided by any third party during the term of the agreement. All the benefits and interests generated from the agreement, including but not limited to intellectual property rights, know-how and trade secrets, will be CCM Tianjin’s sole and exclusive property. This agreement has a term of 10 years and may be extended unilaterally by CCM Tianjin with CCM Tianjin's written confirmation prior to the expiration date. E-commerce Tianjin cannot terminate the agreement early unless CCM Tianjin commits fraud, gross negligence or illegal acts, or becomes bankrupt or winds up.

  

2) Exclusive Purchase Option Agreement by and among CCM Tianjin, E-commerce Tianjin, Mr. Zeyao Xue and Mr. Kai Xu. Pursuant to the Exclusive Purchase Option Agreement, Mr. Zeyao Xue and Mr. Kai Xu granted to CCM Tianjin and any party designated by CCM Tianjin the exclusive right to purchase, at any time during the term of this agreement, all or part of the equity interests in E-commerce Tianjin, or the “Equity Interests,” at a purchase price equal to the registered capital paid by Mr. Zeyao Xue and Mr. Kai Xu for the Equity Interests, or, in the event that applicable law requires an appraisal of the Equity Interests, the lowest price permitted under applicable law. Pursuant to powers of attorney executed by Mr. Zeyao Xue and Mr. Kai Xu, they irrevocably authorized any person appointed by CCM Tianjin to exercise all shareholder rights, including but not limited to voting on their behalf on all matters requiring approval of E-commerce Tianjin’s shareholder, disposing of all or part of the shareholder's equity interest in E-commerce Tianjin, and electing, appointing or removing directors and executive officers. The person designated by CCM Tianjin is entitled to dispose of dividends and profits on the equity interest without reliance on any oral or written instructions of Mr. Zeyao Xue and Mr. Kai Xu. The powers of attorney will remain in force for so long as Mr. Zeyao Xue and Mr. Kai Xu remain the shareholders of E-commerce Tianjin. Mr. Zeyao Xue and Mr. Kai Xu have waived all the rights which have been authorized to CCM Tianjin’s designated person under the powers of attorney.

 

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3) Equity Pledge Agreements by and among CCM Tianjin, E-commerce Tianjin, Mr. Zeyao Xue and Mr. Kai Xu. Pursuant to the Equity Pledge Agreements, Mr. Zeyao Xue and Mr. Kai Xu pledged all of the Equity Interests to CCM Tianjin to secure the full and complete performance of the obligations and liabilities on the part of E-commerce Tianjin and them under this and the above contractual arrangements. If E-commerce Tianjin, Mr. Zeyao Xue, or Mr. Kai Xu breaches their contractual obligations under these agreements, then CCM Tianjin, as pledgee, will have the right to dispose of the pledged equity interests. Mr. Zeyao Xue and Mr. Kai Xu agree that, during the term of the Equity Pledge Agreements, they will not dispose of the pledged equity interests or create or allow any encumbrance on the pledged equity interests, and they also agree that CCM Tianjin’s rights relating to the equity pledge should not be interfered with or impaired by the legal actions of the shareholders of E-commerce Tianjin, their successors or designees. During the term of the equity pledge, CCM Tianjin has the right to receive all of the dividends and profits distributed on the pledged equity. The Equity Pledge Agreements will terminate on the second anniversary of the date when E-commerce Tianjin, Mr. Zeyao Xue and Mr. Kai Xu have completed all their obligations under the contractual agreements described above. 

 

As a result of the above contractual arrangements, CCM Tianjin has substantial control over E-commerce Tianjin’s daily operations and financial affairs, election of its senior executives and all matters requiring shareholder approval. Furthermore, as the primary beneficiary of E-commerce Tianjin, the Company, via CCM Tianjin, is entitled to consolidate the financial results of E-commerce Tianjin in its own consolidated financial statements.

 

The Exclusive Operation and Use Rights Authorization Letter, the Exclusive Technology Consulting and Service Agreement, the Exclusive Purchase Option Agreement, the Equity Pledge Agreements and Powers of Attorney are filed as Exhibit 10.1, 10.2, 10.3, 10.4, 10.5, 10.6 and 10.7 to this Current Report on Form 8-K. The foregoing summary of the terms of the VIE Agreements is subject to, and qualified in its entirety by, the Exclusive Technology Consulting and Service Agreement, the Exclusive Purchase Option Agreement, and the Equity Pledge Agreements, which are incorporated herein by reference.

   

Item 9.01 Financial Statements and Exhibits

 

(d) Exhibits

 

Exhibit No.   Exhibit Title or Description
10.1   Exclusive Operation and Use Rights Authorization Letter by Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd., dated July 31, 2019.
10.2   Exclusive Technology Consulting and Service Agreement by and between Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd. and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd, dated July 31, 2019.
10.3   Exclusive Purchase Option Agreement by and among Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd., Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. Zeyao Xue and Kai Xu, dated July 31, 2019.
10.4   Equity Pledge Agreement by and among by and among Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd., Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. and Zeyao Xue, dated July 31, 2019.
10.5   Equity Pledge Agreement by and among by and among Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd., Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. and Kai Xu, dated July 31, 2019.
10.6   Power of Attorney issued by Zeyao Xue, dated July 31, 2019.
10.7   Power of Attorney issued by Kai Xu, dated July 31, 2019.

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  Future FinTech Group Inc.
   
Date: August 6, 2019 By: /s/ Yongke Xue
  Name: Yongke Xue
  Title: Chief Executive Officer

 

 

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Exhibit 10.1

 

Chain Cloud Mall System

 

Exclusive Operation and Use Rights Authorization Letter

 

We hereby authorize Chain Cloud Mall E-commerce (Tianjin) Co., Ltd, to exclusive operate and use the Chain Cloud Mall System and the authorization period of this letter is the same as the term of the EXCLUSIVE TECHNOLOGY CONSULTING AND SERVICE AGREEMENT entered into by and between Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd. and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019. Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd. has the right to unilaterally terminate this authorization at any time by providing a 30 day prior notice to Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. This authorization is only for Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. shall not re-authorize or assign such rights to any third party.

 

Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

July 31, 2019

Exhibit 10.2

 

EXCLUSIVE TECHNOLOGY CONSULTING AND SERVICE AGREEMENT

 

This EXCLUSIVE TECHNOLOGY CONSULTING AND SERVICE AGREEMENT (this “Agreement”), dated July 31, 2019, is made in Tianjin, the People’s Republic of China (the “PRC”) by and among:

 

Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd., with registered address at A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin; and

 

Party B: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd, with registered address at A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin.

 

(Party A and Party B individually, a “Party”; collectively, the “Parties”)

 

Whereas,

 

1. Party A is a wholly foreign-owned enterprise duly incorporated and validly existing under the PRC laws, having the resources and qualifications to provide Party B with technology consulting and services;

 

2. Party B is a limited liability company duly incorporated and validly existing under the PRC laws;

 

NOW, THEREFORE, the Parties hereby agree as follows through negotiations:

 

1. Technology Consulting and Services; Sole and Exclusive Rights and Interests

 

1.1 During the term of this Agreement, Party A agrees to provide Party B with technology consulting and services set forth in Exhibit I attached hereto subject to the terms and conditions of this Agreement.

 

1.2 Party B agrees to accept the technology consulting and services provided by Party A. Party B further agrees that during the term hereof, it will not accept the same or similar technology consulting and services with respect to the foregoing business operations from any third party, unless with prior written consent from Party A.

 

1.3 Any and all rights and interests arising from performance of this Agreement, including without limitation ownership, copyright, patent and other intellectual properties, technical and business secrets, which is developed by Party A, will be solely and exclusively owned by Party A.

 

2. Calculation and Payment of Technology Consulting and Services Fee

 

2.1 Party B agrees to pay technology consulting and services fee set forth under this Agreement to Party A for the technology consulting and services provided by Party A under this Agreement (the “Consulting Services Fee”).

 

 

 

2.2 The Parties agree to determine and pay the Consulting Services Fee according to Exhibit II attached hereto.

 

3. Representations and Warranties

 

3.1 Party A hereby represents and warrants that:

 

3.1.1. It is a wholly foreign-owned enterprise duly incorporated and validly existing under the laws of the PRC;

 

3.1.2. Its execution and performance of this Agreement are within the scope of its corporate power and business; it has taken necessary corporate actions and obtained appropriate authorization and necessary consent and approvals from third parties and government agency, and execution of this Agreement will not constitute a breach of any law or contract which has binding or other effect upon it; and

 

3.1.3. This Agreement, once executed, constitutes legal, valid and binding obligations of Party A, and is enforceable upon Party A pursuant to its terms.

 

3.2 Party B hereby represents and warrants that:

 

3.2.1. It is a limited liability company duly incorporated and validly existing under the laws of the PRC;

 

3.2.2. Its execution and performance of this Agreement are within the scope of its corporate power and business; it has taken necessary corporate actions and obtained appropriate authorization and necessary consent and approvals from third parties and government agency, and execution of this Agreement will not constitute a breach of any law or contract which has binding or other effect upon it; and

 

3.2.3. This Agreement, once executed, constitutes legal, valid and binding obligations of Party B, and is enforceable upon Party B pursuant to its terms.

 

4. Confidentiality

 

4.1 Party B agrees to take reasonably best efforts to keep in confidence Party A’s confidential information and materials (“Confidential Information”) that it may be aware of or have access to in connection with its acceptance of Party A’s exclusive consulting and services. Without prior written consent from Party A, Party B shall not disclose, offer or transfer any Confidential Information to any third party. If this Agreement terminates and upon Party A’s request, Party B shall return to Party A or destroy all of the documents, materials or software containing Confidential Information, and shall delete any Confidential Information from all relevant memory devices and cease to use any Confidential Information.

 

44.2 This Article 4 will survive any change, termination or expiration of this Agreement.

 

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5. Breach of Contract

 

If either party (the “Defaulting Party”) breaches any provision of this Agreement, which causes damage to the other Party (the “Non-defaulting Party”), the Non-defaulting Party may notify the Defaulting Party in writing and request it to rectify and correct such breach of contract; if the Defaulting Party fails to take any action satisfactory to the Non-defaulting Party to rectify and correct such breach within fifteen (15) working days upon the issuance of the written notice by the Non-defaulting Party, the Non-defaulting Party may take the actions pursuant to this Agreement or pursue other remedies in accordance with laws.

 

6. Effectiveness and Term

 

6.1 This Agreement shall take effect as of the date first written above. The term of this Agreement is ten (10) years unless early termination occurs in accordance with relevant provisions herein or any other agreement reached by the Parties.

 

6.2 This Agreement may be extended upon Party A’s written confirmation prior to the expiration of this Agreement and the extended term shall be determined by Party A.

 

7. Termination

 

7.1 This Agreement shall be terminated on the expiring date unless it is renewed in accordance with the relevant provisions herein.

 

7.2 During the term hereof, Party B may not make early termination of this Agreement unless Party A commits gross negligence, fraud or other illegal action, or goes bankrupt. Notwithstanding the foregoing, Party A shall always have the right to terminate this Agreement by issuing a thirty (30) days’ prior written notice to Party B.

 

7.3 The rights and obligations of the Parties under Articles 4 and 5 will survive termination of this Agreement.

 

8. Governing Law and Dispute Resolution

 

8.1 The execution, interpretation, performance of this Agreement and the disputes resolution under this Agreement shall be governed by the PRC laws.

 

8.2 The parties hereto shall strive to settle any dispute arising from the interpretation or performance of the terms under this Agreement through friendly consultation in good faith. In case no settlement can be reached through consultation within thirty (30) days after the request for consultation is made by either Party, any Party can submit such matter to China International Economic and Trade Arbitration Commission for arbitration in accordance with its then effective rules. The arbitration shall take place in Beijing. The arbitration award shall be final and binding upon both Parties.

 

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9. Force Majeure

 

9.1 “Force Majeure Event” shall mean any event beyond the reasonable controls of the Party so affected, which are unpredictable, unavoidable, irresistible even if the affected Party takes a reasonable care, including but not limited to governmental acts, Act of God, fires, explosion, geographical variations, storms, floods, earthquakes, morning and evening tides, lightning or wars, riot, strike, and any other such events that all Parties have reached a consensus upon. However, any shortage of credits, funding or financing shall not be deemed as the events beyond reasonable controls of the affected Party.

 

9.2 In the event that the performance of this Agreement is delayed or interrupted due to the said Force Majeure Event, the affected Party shall be excused from any liability to the extent of the delayed or interrupted performance. The affected Party which intends to seek exemption from its obligations of performance under this Agreement or any provision of this Agreement shall immediately inform the other Party of such a Force Majeure Event and the measures it needs to take in order to complete its performance.

 

10. Notices

 

All notices or other correspondences given by either Party pursuant to this Agreement shall be made in writing and may be delivered in person, or by registered mail, postage prepaid mail, generally accepted courier service or facsimile to the following addresses of the relevant Party or both Parties, or any other address notified by the other Party from time to time, or another person’s address designated by it. The date when the notice is deemed to be duly served shall be determined as the follows: (a) a notice delivered personally is deemed duly served upon the delivery; (b) a notice sent by mail is deemed duly served on the seventh (7 ) day after the air registered mail with postage prepaid has been sent out (as is shown on the postmark), or the fourth (4 ) day after delivery to the internationally recognized courier service agency; and (c) a notice sent by facsimile transmission is deemed duly served upon the receipt time as is shown on the transmission confirmation of relevant documents.

 

If to Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

Address: A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

 

Telephone: 86-

 

Attention: Yongning Jia

 

If to Party B: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

Address: A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

 

Telephone: 86-

 

Attention: Kai Xu

 

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11. Assignment

 

Party B shall not assign its rights and obligations under this Agreement to any third party without the prior written consent of Party A.

 

12. Severability

 

If any provision of this Agreement is held void, invalid or unenforceable by a court of competent jurisdiction or arbitration authority, the validity, legality and enforceability of the other provisions hereof shall not be affected or impaired. The Parties shall cease performing such void, invalid or unenforceable provisions and revise such void, invalid or unenforceable provisions only to the extent closest to the original intention thereof to recover its validity or enforceability for such specific facts and circumstances.

 

13. Amendment and Supplement to Agreement

 

Any amendment and supplement to this Agreement shall be made in writing by the Parties. Any agreements on such amendment and supplement duly executed by both Parties shall be deemed as a part of this Agreement and shall have the same legal effect as this Agreement.

 

14. Miscellaneous

 

14.1 The headings contained in this Agreement are for the convenience of reference only and shall not be used to interpret, explain or otherwise affect the meaning of the provisions of this Agreement.

 

14.2 The Parties agree to promptly execute any document and take any other action reasonably necessary or advisable to perform provisions and purpose of this Agreement.

 

14.3 The Parties confirm that this Agreement shall, upon its effectiveness, constitute the entire agreement and common understanding of the Parties with respect to the subject matters herein and fully supersede all prior verbal and/or written agreements and understandings with respect to the subject matters herein.

 

14.4 This Agreement shall be binding upon and for the benefit of all the Parties hereto and their respective inheritors, successors and the permitted assigns.

 

14.5 Any Party’s failure to exercise the rights under this Agreement in time shall not be deemed as its waiver of such rights and would not affect its future exercise of such rights.

 

14.6 Any attachment hereto is an integral part of and has the same effect with this Agreement.

 

14.7 This Agreement is made in two originals with each Party holding one and both originals are equally authentic.

 

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(Signature Page of Exclusive Technology Consulting and Service Agreement)

 

IN WITNESS THEREOF, each Party hereto has caused this Agreement duly executed by their respective legal representative or duly authorized representative on its behalf as of the date first written above.

 

 

 

Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

(Seal)

 

 

 

Party B: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

(Seal)

 

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Exhibit I: List of Technology Consulting and Services

 

Party A will provide the following technology consulting and services to Party B:

 

(1) webpage design and content creation for all of the existing and potential websites of Party B;

 

(2) technology research and development required in connection Party B’s business operations, including development, design and production of database software for information storage, customer interface software and other related technologies as well as granting license of such technology to Party B;

 

(3) technology application and implementation for Party B’s business operations, including without limitation master design, installation, commissioning and trial operation of technical systems;

 

(4) routine maintenance, supervision, commissioning and trouble shooting for Party B’s computer network equipment, including prompt customer information input to database, or promptly update database and customer interface, as well as other related technical services;

 

(5) consulting services for procurement of equipment, software and hardware systems necessary for web-based business operations by Party B, including without limitation consulting and advising on selection, installation and commissioning of tool software, application software and technical platform, as well as the selection, type and function of complementary hardware facilities and equipment;

 

(6) appropriate training and technical support for Party B’s employees, including without limitation providing training on customer services or technologies, sharing knowledge and experience on installation and operation of systems and equipment, assisting to resolve any problem in connection with system and equipment installation and operation, consulting and advising on operation of any other web edition platform and software, and assisting to collect and compile information and contents;

 

(7) technology consulting and response to enquiries raised by Party B relating to network equipment, technical products and software; and

 

(8) any other technical services and consulting required by Party B for business operations.

 

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Exhibit II: Calculation and Payment of Technology Consulting and Services Fee

 

I. To the extent permitted by PRC law, after making up losses of previous years (if necessary) and deducting necessary costs, expenses and taxes with respect to business operation, Party B shall pay in full to Party A the pre-tax profit without calculating the exclusive consultation and service fee hereunder as the fee for Party A’s provision of consultation and services to Party B hereunder, but Party A has the right to adjust the amount of such fee based on specific situation of Party A’s provision of the exclusive consultation and service to Party B, Party B’s state of operation and Party B’s developmental needs.

 

II. The amount of the Service Fee shall be negotiated by the Parties based on the following factors:

 

  1. the level of technological difficulty and complexity of consultation and services;

 

  2. the time spent on consultation and services by Party A’s employees;

 

  3. the specific content and commercial value of consultation and services; and

 

  4. market reference prices for consultation and services of the same type.

 

III. Party A shall calculate the Service Fee on a quarterly basis, and within thirty (30) days from the beginning of any quarter, notify Party B by issuing the Service Fee bill for the previous quarter to Party B. Within ten (10) business days after receiving such notice, Party B shall pay such fee to the bank account designated by Party A. Party B shall, within ten (10) business days after the transfer of the amount, send Party A the photocopy of the voucher of the transfer by email, fax or mail.

 

IV. Party A has the right to adjust at any time the standard of the consulting and service fee according to the amount and contents of the consulting services it has provided to the Party B.

 

 

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Exhibit 10.3

 

EXCLUSIVE PURCHASE OPTION AGREEMENT

 

This EXCLUSIVE PURCHASE OPTION AGREEMENT (this “Agreement”), dated July 31, 2019, is made in Tianjin, the People’s Republic of China (the “PRC”) by and among:

 

Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd., a wholly foreign owned company incorporated in the PRC with registered address at A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin;

 

Party B: Zeyao Xue; Kai Xu;

 

And

 

Party C: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd., a limited liability company incorporated and existing under the laws of the PRC, with registered address at A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin.

 

(Party A, Party B and Party C individually being referred to as a “Party” and collectively the “Parties”)

 

Whereas,

 

1. Party C is a limited liability company duly incorporated and validly existing under the PRC laws. Party B has an aggregate holding of 100% equity interests in Party C, with Zeyao Xue and Kai Xu holding 90% and 10% thereof, respectively;

 

2. Party A and Party B have made an Equity Pledge Agreement (the “Equity Pledge Agreement”) dated July 31, 2019.

 

NOW, THEREFORE, the Parties hereby agree as follows through negotiations:

 

1. Purchase and Sale of Equity Interests

 

1.1 Grant of Right

 

Party B hereby exclusively and irrevocably grants Party A an exclusive option to purchase or designate one or several person(s) (the “Designated Person”) to purchase all or any part of the equity interests held by Party B in Party C (the “Purchase Option”) at any time from Party B at the price specified in Article 1.3 of this Agreement in accordance with the procedures determined by Party A at its own discretion and to the extent permitted by the PRC laws. No party other than Party A and the Designated Person may have the Purchase Option. Party C hereby agrees Party B to grant the Purchase Option to Party A. For purpose of this Section 1.1 and this Agreement, “person” means any individual, corporation, joint venture, partnership, enterprise, trust or non-corporation organization.

 

1.2 Procedures

 

Party A may exercise the Purchase Option subject to its compliance with the PRC laws and regulations. Upon exercising the Purchase Option, Party A will issue a written notice (the “Equity Interest Purchase Notice”) to Party B which notice will specify: (i) Party A’s decision to exercise the Purchase Option; (ii) the percentage of equity interest to be purchased from Party B (the “Purchased Equity Interest”); (iii) the date of purchase/equity interest transfer, and (iv) and the purchase price.

 

 

 

 

1.3 Purchase Price

 

1.3.1. When Party A exercises the Purchase Option, the purchase price of the Purchased Equity Interest

 

(“Purchase Price”) shall be equal to the registered capital paid by Party B for the Purchased Equity Interest, unless applicable PRC laws and regulations require appraisal of the Purchased Equity Interest or any other restriction on the Purchase Price.

 

1.3.2. If applicable PRC laws require appraisal of the Purchased Equity Interest or any other restrictions on the Purchase Price in connection with exercise of the Purchase Option by Party A, Party A and Party B agree that the Purchase Price of the Purchased Equity Interest shall be the lowest price permissible under applicable laws.

 

1.4 Transfer of the Purchased Equity Interest

 

When Party A exercises the Purchase Option:

 

1.4.1. Party B shall cause Party C to promptly convene a shareholders’ meeting, during which a resolution shall be adopted to approve transfer of the equity interest to Party A and/or the Designated Person and waiver of its right of first refusal regarding the Purchased Equity Interest by Party B;

 

1.4.2. Party B shall enter into an equity interest transfer agreement with Party A and/or the Designated

 

Person pursuant to the terms and conditions of this Agreement and the Purchase Notice;

 

1.4.3. The Parties shall execute all other contracts, agreements or documents, obtain all governmental approvals and consents, and conduct all actions that are necessary to transfer the ownership of the Purchased Equity Interest to Party A and/or the Designated Person free from any Security Interest and cause Party A and/or the Designated Person to be registered as the owner of the Purchased Equity Interest. For the purpose of this Section 1.4.3 and this Agreement, “Security Interest” includes guarantees, mortgages, pledges, third-party rights or interests, any purchase option, right of acquisition, right of first refusal, right of set-off, ownership detainment or other security arrangements, but excludes any security interest arising from this Agreement or the Equity Pledge Agreement.

 

1.4.4. Party B and Party C shall unconditionally use its best efforts to assist Party A in obtaining the governmental approvals, permits, registrations, filings and complete all formalities necessary for the transfer of the Purchased Equity Interest.

 

2. Covenants regarding the Equity Interest

 

2.1 Party C hereby covenants that:

 

2.1.1 Without prior written consent by Party A, it will not supplement, change or amend the Articles of

 

Association, increase or decrease the registered capital, or otherwise change the registered capital structure of Party C;

 

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2.1.2 It will maintain due existence of Party C, prudently and effectively operate and handle its business in accordance with fair financial and business standards and customs;

 

2.1.3 Without prior written consent of Party A, it will not sell, transfer, pledge or otherwise dispose any legal or beneficial interest of any assets, businesses or income of Party C, or permit existence of such Security Interest;

 

2.1.4 Without prior written consent by Party A, it will not incur, inherit, guarantee or allow the existence of any debt, except for (i) any debt incurred during its ordinary course of business rather than from borrowing; and (ii) any debt which has been disclosed to and obtained the written consent from Party A;

 

2.1.5 It will always conduct business operations in the ordinary course to maintain its asset value, and refrain from any action/omission that may adversely affect its business operations and asset value;

 

2.1.6 Without prior written consent by Party A, it will not to enter into any material agreement other than those executed in its ordinary course of business (for purpose of this Section 2.1.6, a material agreement means any agreement with a contract value exceeding RMB one hundred thousand Yuan (RMB 100,000));

 

2.1.7 Without prior written consent by Party A, it will not provide any loan or guaranty to any person;

 

2.1.8 Upon Party A’s request, it will provide Party A with information regarding its operations and financial conditions;

 

2.1.9 It will buy and maintain requisite insurance policies from an insurer acceptable to Party A, the amount and type of which will be the same with those maintained by the companies having similar operations, properties or assets in the same region;

 

2.1.10 Without prior written consent by Party A, it will not combine, merge with, acquire or make investment to any person;

 

2.1.11 It will immediately notify Party A of any actual or potential litigation, arbitration or administrative proceeding regarding its assets, business and income;

 

2.1.12 In order to keep its ownership of the equity interest of Party C, it will execute all requisite or appropriate documents, conduct all requisite or appropriate actions, and make all requisite or appropriate claims, or make requisite or appropriate defense against all claims; and

 

2.1.13 Without prior written consent by Party A, it will not distribute any dividend or bonus to any of its shareholders.

 

2.2 Party B hereby covenants that:

 

2.2.1 Without prior written consent by Party A, it will not supplement, change or amend the Articles of

 

Association, increase or decrease the registered capital, or otherwise change the registered capital structure of Party C;

 

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2.2.2 Without the prior written consent by Party A, it will not sell, transfer, pledge or otherwise dispose any legal or beneficial interest of the equity interests of Party C held by it, or allow other security interests to be created on it, except for the pledge set upon Party C’s equity interests held by Party B pursuant to the Equity Pledge Agreement;

 

2.2.3 It will procure that without prior written consent by Party A, no resolution be made at any meeting of Party C’s shareholders to approve Party C to sell, transfer, pledge or otherwise dispose any legal or beneficial interest of the equity interests of Party C held by it, or allow other security interests to be created on it, except for the pledge set upon Party C’s equity interests held by Party B pursuant to the Equity Pledge Agreement;

 

2.2.4 It will procure that without prior written consent by Party A, no resolution be made at any meeting of Party C’s shareholders to approve merger, consolidation, purchase or investment with or any person by Party C;

 

2.2.5 It will immediately notify Party A of any actual or potential litigation, arbitration or administrative proceeding regarding its assets, business and income;

 

2.2.6 It will cause Party C’s shareholders’ meeting to vote for the transfer of the Purchased Equity Interest provided hereunder;

 

2.2.7 In order to keep its ownership of the equity interests of Party C, it will execute all requisite or appropriate documents, conduct all requisite or appropriate actions, and make all requisite or appropriate claims, or make requisite or appropriate defense against all claims;

 

2.2.8 At the request of Party A, it will appoint any person nominated by Party A to the board of Party C;

 

2.2.9 At the request of Party A at any time, it will transfer unconditionally and immediately the Purchased Equity Interest to Party A or any Designated Person and waive the right of first refusal regarding the Purchased Equity Interest. If the equity interest of Party C could be sold or transferred to any party other than Party A or the Designated Person, Party B may not waive its right of first refusal without Party A’s consent;

 

2.2.10 It will strictly comply with the provisions of this Agreement and other agreements jointly or severally executed by any of the Parties, duly perform all obligations under such agreements, and will not make any act or omission which may affect the validity and enforceability of these agreements; and

 

2.2.11 It irrevocably undertakes to be severally and jointly liable for the obligations provided hereunder.

 

2.3 Party A hereby convenants that:

 

To satisfy the cash flow requirements with regard to the business operations of Party C or make up Party C’s losses accured through such operations, Party A agrees that it shall, through itself or its designated person, provide financial support to Party C.

 

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3. Representations and Warranties

 

Each of Party B and Party C represents and warrants, jointly and severally, to Party A that as of the date of this Agreement:

 

3.1 It has the rights and powers to execute and deliver this Agreement and any equity interest transfer agreement (the “Transfer Agreement”) executed for each transfer of the Purchased Equity Interest contemplated hereunder to which it is a party, and perform its obligations under this Agreement and any Transfer Agreement. Once executed, this Agreement and the Transfer Agreement to which it is a party will be its legal, valid and binding obligations and enforceable against it according to the terms of this Agreement and the Transfer Agreement.

 

3.2 None of its execution, delivery and performance of this Agreement or any Transfer Agreement will:

 

(i) breach any applicable PRC laws; (ii) conflict with its articles of association or any other organizational documents;(iii) breach any agreement or document to which it is a party or binding upon it, or constitute breach of any such agreement or document; (iv) breach any condition on which basis any of its permits or approvals is granted and/or will continue to be effective; or (v) cause any of its permits or approvals to be suspended, cancelled or imposed with additional conditions.

 

3.3 Party B has good and entire ownership of and creates no security interest or encumbrance upon any of its assets.

 

3.4 Party C has no outstanding debt, except for those (i) incurred during its ordinary course of business, and (ii) disclosed to and approved in writing by Party A.

 

3.5 Party C is in compliance with all applicable laws and regulations.

 

4. Effectiveness and Term

 

4.1 This Agreement shall be effective as of the date of its execution.

 

4.2 The term of this Agreement is ten (10) years. This Agreement may be extended for another ten (10) years upon Party A’s written confirmation prior to the expiration of this Agreement, and so forth thereafter.

 

4.3 During the term provided in Section 4.2, if Party A or Party C is terminated at expiration of their respective operation term (including any extension of such term) or by any other reason, this Agreement shall be terminated upon such termination.

 

5. Termination

 

5.1 At any time during the term of this Agreement and any extended term hereof, if Party A cannot exercise the Purchase Option pursuant to Section 1 due to then applicable laws, Party A can, at its own discretion, unconditionally terminate this Agreement by issuing a written notice to Party B without any liability.

 

5.2 If Party C is terminated due to bankruptcy, dissolution or being ordered to close down by the laws during the term of this Agreement and its extension period,, the obligations of Party B hereunder shall be terminated upon the termination of Party C; notwithstanding anything to the contrary, Party B shall immediately repay the principal and any interest accrued thereupon under accrued thereupon under any loan agreement between the Party A and Party C.

 

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5.3 Except under circumstances indicated in Section 5.2, Party B may not unilaterally terminate this Agreement at any time during the term and extension periods of this Agreement without Party A’s written consent.

 

6. Taxes and Expenses

 

Each Party shall bear any and all taxes, costs and expenses related to transfer and registration as required by the PRC laws incurred by or imposed on such Party arising from the preparation and execution of this Agreement and the consummation of the transaction contemplated hereunder.

 

7. Breach of Contract

 

7.1 If either Party (“Defaulting Party”) breaches any provision of this Agreement, which causes damage to other Parties (“Non-defaulting Party”), the Non-defaulting Party could notify the Defaulting Party in writing and request it to rectify and correct such breach of contract; if the Defaulting Party fails to take any action satisfactory to the Non-defaulting Party to rectify and correct such breach within fifteen (15) days upon the issuance of the written notice by the Non-defaulting Party, the Non-defaulting Party may take the actions pursuant to this Agreement or take other remedies in accordance with the laws.

 

7.2 The following events shall constitute a default by Party B:

 

(1) Party B breaches any provision of this Agreement, or any representation or warranty made Party B under this Agreement is untrue or proves inaccurate in any material aspect;

 

(2) Party B assigns or otherwise transfers or disposes of any of its rights under this Agreement without the prior written consent by Party A; or

 

(3) Any breaches by Party B which renders this Agreement and the Equity Pledge Agreement unenforceable.

 

7.3 Should a breach of contract by Party B or violation by Party B of the Equity Pledge Agreement occur, Party A may request Party B to immediately transfer all or any part of the Purchased Equity Interests to Party A or the Designated Person pursuant to this Agreement.

 

8. Notices

 

Notices or other communications required to be given by any Party pursuant to this Agreement shall be made in writing and delivered personally or sent by mail or facsimile transmission to the addresses of the other Parties set forth below or other designated addresses notified by such other Parties to such Party from time to time. The date when the notice is deemed to be duly served shall be determined as the follows: (a) a notice delivered personally is deemed duly served upon the delivery; (b) a notice sent by mail is deemed duly served on the seventh (7) day after the date when the air registered mail with postage prepaid has been sent out (as is shown on the postmark), or the fourth (4 ) day after the delivery date to the internationally recognized courier service agency; and (c) a notice sent by facsimile transmission is deemed duly served upon the receipt time as is shown on the transmission confirmation of relevant documents.

 

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If to Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

Address: A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

 

Phone: 86-

 

Attention: Yongning Jia

 

If to Party B:

 

乙方:

 

Zeyao Xue

 

Address: 23F, China Development Bank Tower, No. 2 Gaoxin 1st Road, Xi'an, Shaanxi

 

Phone: 86-29-

 

Kai Xu

 

Address: A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

 

Phone: 86-

 

If to Party C: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd

 

Address: A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

 

Phone: 86-

 

Attention: Kai Xu

 

9. Applicable Law and Dispute Resolution

 

9.1 The formation, validity, performance and interpretation of this Agreement and the disputes resolution under this Agreement shall be governed by the PRC laws.

 

9.2 The Parties shall strive to settle any dispute arising from or in connection with this Agreement through friendly consultation. In case no settlement can be reached through consultation within thirty (30) days after the request for consultation is made by any Party, any Party can submit such matter to China International Economic and Trade Arbitration Commission for arbitration in accordance with its then effective rules. The arbitration shall take place in Beijing. The arbitration award shall be final and binding upon all the Parties.

 

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10. Confidentiality

 

All Parties acknowledge and confirm that any oral or written materials exchanged by and between the Parties in connection with this Agreement are confidential. All Parties shall keep in confidence all such information and not disclose it to any third party without prior written consent from other Parties unless: (a) such information is known or will be known by the public(except by disclosure of the receiving party without authorization); (b) such information is required to be disclosed in accordance with applicable laws or rules or regulations; or (c) if any information is required to be disclosed by any party to its legal or financial advisor for the purpose of the transaction of this Agreement, such legal or financial advisor shall also comply with the confidentiality obligation similar to that stated hereof. Any disclosure by any employee or agency engaged by any Party shall be deemed the disclosure of such Party and such Party shall assume the liabilities for its breach of contract pursuant to this Agreement. This Article shall survive expiration or termination of this Agreement.

 

11. Miscellaneous

 

11.1 The headings contained in this Agreement are for the convenience of reference only and shall not be used to interpret, explain or otherwise affect the meaning of the provisions of this Agreement.

 

11.2 The Parties agree to promptly execute any document and take any other action reasonably necessary or advisable to perform provisions and purpose of this Agreement.

 

11.3 The Parties confirm that this Agreement shall, upon its effectiveness, constitute the entire agreement and common understanding of the Parties with respect to the subject matters herein and fully supersede all prior verbal and/or written agreements and understandings with respect to the subject matters herein.

 

11.4 The Parties may amend and supplement this Agreement in writing. Any amendment and/or supplement to this Agreement by the Parties is an integral part of and has the same effect with this Agreement.

 

11.5 This Agreement shall be binding upon and for the benefit of all the Parties hereto and their respective inheritors, successors and the permitted assigns.

 

11.6 Any Party’s failure to exercise the rights under this Agreement in time shall not be deemed as its waiver of such rights and would not affect its future exercise of such rights.

 

11.7 If any provision of this Agreement is held void, invalid or unenforceable by a court of competent jurisdiction, governmental agency or arbitration authority, the validity, legality and enforceability of the other provisions hereof shall not be affected or impaired in any way. The Parties shall cease performing such void, invalid or unenforceable provisions and revise such void, invalid or unenforceable provisions only to the extent closest to the original intention thereof to recover its validity or enforceability for such specific facts and circumstances.

 

11.8 Unless with prior written consent from Party A, none of Party B or Party C may assign any of its rights and obligations under this Agreement to any third party.

 

11.9 This Agreement is made in four (4) originals with each Party holding one (1) original. Each original has the same effect.

 

(No text below)

 

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(Signature Page)

 

IN WITNESS THEREOF, each Party has signed or caused its authorized representative to sign this Agreement as of the date first written above.

 

Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

(Seal of Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.)

 

By: /s/ Yongning Jia  
     
Party B:  
     
Zeyao Xue  
     
By: /s/ Zeyao Xue  
     
Kai Xu  
     
By: /s/ Kai Xu  
     
Party C: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.  
     
/s/ Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.  
     
By: (Seal of Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.)  

 

 

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Exhibit 10.4

 

Equity Pledge Agreement

 

This EQUITY PLEDGE AGREEMENT, (this “ Agreement ”), dated July 31, 2019, is made in Tianjin, the People’s Republic of China (“ PRC ”) by and among:

 

Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

 

Party B: Zeyao Xue ;

 

Party C: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

 

(Party B is referred to as “Pledgor” hereinafter; Party A is referred to as “Pledgee” hereinafter; and either the Pledgor or the Pledgee is individually referred to as a “Party” and collectively referred to as the “Parties”.)

 

Whereas,

 

(1) Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. (“E-commerce Tianjin”) is a limited liability company duly incorporated and validly existing under the PRC laws, with the registered share capital of RMB 188.88 million.
   
(2) The Pledgor holds 90% of total equity interests of E-commerce Tianjin. The amount of pledged debt equals the value of the Pledged Equity Interests as defined below, together with obligations under the relevant agreements.
   
(3) The Pledgee is a wholly foreign owned company duly incorporated and existing under the laws of the PRC.
   
(4) The Pledgee and E-commerce Tianjin entered into an Exclusive Technology Consulting and Service Agreement on July 31, 2019 (“Services Agreement”).
   
(5) The Pledgor, E-commerce Tianjin and the Pledgee entered into an Exclusive Purchase Option Agreement on July 31, 2019 (“Exclusive Purchase Option Agreement”). In addition, the Pledgor delivered the Power of Attorney to the Pledgee on July 31, 2019 (“Power of Attorney”, together with the Services Agreements and Exclusive Purchase Option Agreement, collectively referred as “Master Agreement”).
   
(6) In order to secure the Pledgor’s performance of his obligations under this Agreement and the Master Agreement, and in order to ensure E-commerce Tianjin to be able to perform its obligations under the Services Agreements, the Pledgor hereby pledges all the equity interests held by him in E-commerce Tianjin as the guaranty for his and/or E-commerce Tianjin’s performance of obligations under the Master Agreement.

 

 

 

 

NOW, THEREFORE, the Parties hereby agree as follows through friendly negotiations:

 

1. Definition

 

Unless otherwise specified herein, the following words shall have the meanings as follows:

 

  1.1 Pledge Right: means the priority right the Pledgee owns, with respect to the proceedings arising from selling at a discount, auction of, or selling off the equity interests pledged by the Pledgor to the Pledgee.
     
  1.2 Pledged Equity Interests: means all the equity interests duly held by the Pledgor in E-commerce Tianjin, i.e. 90% equity interests of E-commerce Tianjin, as well as all the other rights created over it.
     
  1.3 Term of Pledge: means the period of term specified in Article 3 hereof.
     
  1.4 Event of Default: means any of the circumstances listed in Article 7 hereof.
     
  1.5 Notice of Default: means any notice issued by the Pledgee to the Pledgor in accordance with this Agreement specifying an Event of Default.

 

2. Pledge Right and Scope of Guaranty

 

  2.1 The Pledgor agrees to pledge all the Pledged Equity Interests to the Pledgee as the guaranty for his and/or E-commerce Tianjin’s performance of all the obligations under the Master Agreement and all the liabilities of indemnification to the Pledgee which may arise due to the invalidity or cancellation of the Master Agreement. E-commerce Tianjin agrees with such equity pledge arrangement.
     
  2.2 The effect of guaranty under the Master Agreement will not be prejudiced by any amendment or change of the Master Agreement. The invalidity or cancellation of the Master Agreement does not impair the validity of this Agreement. In the event that the Master Agreement is deemed as invalid, or cancelled or revoked for any reason, the Pledgee is entitled to realize its pledge right in accordance with Article 8 hereof.

 

3. Creation and Term of Pledge

 

  3.1 The Pledge Right hereunder shall be reflected on the register of shareholders and the capital contribution certificate in accordance with the form as attached to this Agreement.
     
  3.2 The term of the Pledge Right is effective from the registration of pledge of equity interests with the Administration for Industry and Commerce of the place where E-commerce Tianjin is registered, till the day on which all the obligations under the Master Agreement are fully performed (“Term of Pledge”).
     
  3.3 During the Term of Pledge, if the Pledgor and/or E-commerce Tianjin fails to perform any obligation under or arising from the Master Agreement, the Pledgee has the right to dispose of the Pledge Right in accordance with Article 8 hereof.

 

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4. Possession of Pledge Certificates

 

  4.1 The Pledgor shall deliver the register of shareholders and capital contribution certificate of E-commerce Tianjin which reflects the pledge of equity interests as mentioned in above Article 3 within three (3) business days from the execution of this Agreement, to the Pledgee for its possession, and the Pledgee is obligated to keep the received pledge documents.
     
  4.2 The Pledgee is entitled to all the proceeds in cash including the dividends and all the other non-cash proceeds arising from the Pledge Equity Interests since July 31, 2019.

 

5. Representations and Warranties of the Pledgor

 

  5.1 The Pledgor is the legal owner of Pledged Equity Interests.
     
  5.2 Once the Pledgee intends to exercise the rights of the Pledgee under this Agreement anytime, it shall be protected from any interference from any other party.
     
  5.3 The Pledgee has the right to dispose of or transfer the Pledge Right in the way as described hereunder.
     
  5.4 The Pledgor has never created any other pledge right or any other third party right over the Pledged Equity Interests except towards the Pledgee.

 

6. Covenants from the Pledgor

 

  6.1 During the term of this Agreement, the Pledgor covenants to the Pledgee as follows:

 

  6.1.1 Without prior written consent of the Pledgee, the Pledgor should not transfer the Pledged Equity Interests, or create or allow creation of any new pledge or any other security upon the Pledged Equity Interests which may impair the rights and/or interest of the Pledgee, except for the transfer of Pledged Equity Interests to the Pledgee or the person designated by the Pledgee in accordance with the Exclusive Purchase Option Agreement.
     
  6.1.2 The Pledgor shall abide by and exercise all the provisions of laws and regulations in relation to the pledge of rights, and shall present the Pledgee any and all notices, directions or suggestions issued by related competent authorities within two (2) days upon the receipt of such notices, directions or suggestions, and shall comply with such notices, directions or suggestions, or present its opposite opinions and representations regarding the above mentioned issues according to the reasonable request of the Pledgee or with the consent from the Pledgee;
     
  6.1.3 The Pledgor shall give prompt notice to the Pledgee regarding any occurrence or received notice which may influence the Pledged Equity Interests or any part of the Pledged Equity Interests held by the Pledgee, or may change any warranties or obligations of the Pledgor under this Agreement or may influence the performance of obligations by the Pledgor hereunder.

 

  6.2 The Pledgor agrees that, the right of the Pledgee to exercise of Pledge Right hereunder in accordance with this Agreement, shall not be interfered or impaired by any legal proceedings taken by the Pledgor, or the successor or designated person of the Pledgor or any other person.

 

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  6.3 The Pledgor warrants to the Pledgee that, in order to protect or consummate the guaranty provided by this Agreement regarding the performance of the Master Agreement, the Pledgor will faithfully sign, or cause any other party which is materially related to the Pledge Right to sign, any and all right certificates and deeds, and/or take, or cause any other party which is materially related to the Pledge Right to take, any and all actions, reasonably required by the Pledgee, and will facilitate the exercise of the rights and authorizations granted to the Pledgee under this Agreement, enter into any change to related equity certificate with the Pledgee or the Pledgee’s designated person (individual/legal person), and provide to the Pledgee any and all notices, orders and decisions as deemed necessary by the Pledgee.
     
  6.4 The Pledgor undertakes to the Pledgee he will abide by and perform all representations, warranties and undertakings to protect the interests of the Pledgee. The Pledgor shall indemnify the Pledgee any and all losses suffered by the Pledgee due to the Pledgor’s failure or partial failure in performance of his representations, warranties or undertakings.
     
  6.5 The Pledgor covenants to the Pledgee he assumes several and joint liabilities with respect to the obligations hereunder.
     
  6.6 The Pledgor irrevocably agrees to waive the preemptive right with respect to the Pledged Equity Interests pledged by other shareholders of E-commerce Tianjin to the Pledgee, as well as the transfer of equity interests due to the exercise of Pledge Right by the Pledgee.

 

7. Event of Default

 

  7.1 Any of the following is deemed as an Event of Default:

 

  7.1.1 E-commerce Tianjin fails to perform its obligations under the Master Agreement;
     
  7.1.2 Any representation or warranty of the Pledgor under this Agreement is substantially misleading or untrue, and/or the Pledgor breaches any of his representations and warranties under this Agreement;
     
  7.1.3 The Pledgor breaches its covenants hereunder;
     
  7.1.4 The Pledgor breaches any provision hereof;
     
  7.1.5 Except that the Pledgor transfers the equity interests to the Pledgee or the Pledgee’s designated person in accordance with the Exclusive Purchase Option Agreement, the Pledgor waives the Pledged Equity Interests or transfers the Pledged Equity Interests without the written consent from the Pledgee;

 

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  7.1.6 Any external borrowings, guaranty, indemnification, undertakings or any other liabilities of the Pledgor (1) is required to be repaid or exercised early due to its default; or (2) is not repaid or exercised when due, which makes the Pledgee reasonably believes that the ability of the Pledgor to perform his obligations under this Agreement has been impaired.
     
  7.1.7 The Pledgor fails to repay general debts or other liabilities;
     
  7.1.8 This Agreement is deemed to be illegal with promulgation of related laws, or the Pledgor is unable to continue to perform his obligations hereunder;
     
  7.1.9 The consent, permit, approval or authorization from the competent authorities for making this Agreement enforceable, legal or valid is revoked, suspended, invalidated or materially amended;
     
  7.1.10 Adverse change occur with respect to the assets of the Pledgor, which makes the Pledgee reasonably believes that the ability of the Pledgor to perform his obligations under this Agreement has been impaired.
     
  7.1.11 Successor of the Pledgor or E-commerce Tianjin can only perform part of, or refuses to perform, its obligations under this Agreement.
     
  7.1.12 Other circumstances occur which make the Pledgee unable to exercise or dispose of the Pledge Right in accordance with related laws.

 

  7.2 In the event that is aware of or discover that any issue described in the above Article 7.1 or any other issue which may cause the occurrence of such mentioned issues has occurred, the Pledgor shall give a prompt written notice to the Pledgee.
     
  7.3 Unless that the Event of Default specified in above Article 7.1 has been resolved to the satisfaction of the Pledgee, otherwise the Pledgee is entitled to (not obligated to) serve a Notice of Default to the Pledgor immediately following or any time after the occurrence of the Event of Default, to require the Pledgor and E-commerce Tianjin to immediately perform its obligations under the Master Agreement (including without limitation to payment of the due and unpaid debts and other amounts payable under the Services Agreements) or dispose of the Pledge Right in accordance with Article 8 hereof.

 

8. Exercise of Pledge Right

 

  8.1 Prior to the fulfillment of performance of the obligations under the Master Agreement, the Pledgor should not transfer the Pledged Equity Interests without the written consent of the Pledgee.

 

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  8.2 In the event of occurrence of the Event of Default described in above Article 7, the Pledgee shall give a Notice of Default to the Pledgor when exercising the Pledge Right. The Pledgee may exercise the right to dispose of the Pledge Right at the same time of or any time after the service of the Notice of Default.
     
  8.3 The Pledgee has the right to sell in accordance with legal procedure or dispose of in the other way allowed by law the Pledged Equity Interests hereunder. If the Pledgee decides to exercise the Pledge Right, the Pledgor undertakes to transfer all of his shareholder rights to the Pledgee for exercise. In addition, the Pledgee has the priority to receive the proceedings arising from selling at a discount, auction of, or selling off the equity interests pledged by the Pledgor to the Pledgee according to the legal proceedings.
     
  8.4 When the Pledgee is disposing of the Pledge Right in accordance with this Agreement, the Pledgor should not create any obstacle, and shall provide any necessary assistance to help the Pledgee to realize the Pledge Right.

 

9. Transfer of Agreement

 

  9.1 Unless with the prior consent from the Pledgee, the Pledgor has no right to grant or transfer any of his rights and obligations hereunder.
     
  9.2 This Agreement is binding upon the Pledgor and his successor, as well as the Pledgee, and its successors and assignees permitted by the Pledgee.
     
  9.3 The Pledgee is entitled to transfer any or all rights and obligations under the Master Agreement to any person (individual/legal person) designated by it at anytime. Under this circumstance, the assignee have the same rights and obligations as the Pledgee under this Agreement, as if such rights and obligations are granted to it as a party to this Agreement. When transferring the rights and obligations under the Services Agreements, this Agreement, the Exclusive Purchase Option Agreement and/or Power of Attorney, the Pledgor shall sign any and all related agreement and/or documents as required by the Pledgee.
     
  9.4 With the change of pledgee due to the transfer, all the parties to the new pledge shall enter into a new pledge contract, which shall be substantially same to this Agreement in the content and to the satisfaction of the Pledgee.

 

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10. Effectiveness and Termination

 

  10.1 This Agreement becomes effective on the date hereof. All Parties agree and confirm that the terms and conditions hereof become effective since July 31, 2019.
     
  10.2 The Parties confirm that whether the pledge hereunder has been registered and recorded or not will not impair the effectiveness and validity of this Agreement.
     
  10.3 This Agreement will terminate two (2) years after the Pledgor and /or E-commerce Tianjin no longer assume any liability under or arising from the Master Agreement.
     
  10.4 Release of pledge shall be recorded accordingly on the register of shareholders of E-commerce Tianjin and related deregistration formalities shall be proceeded with at the Administration for Industry and Commerce of the place where E-commerce Tianjin is registered.

 

11. Processing Fee and Other Costs

 

All fees and actual costs related to this Agreement, including not limited to legal fees, processing fee, duty stamp and all the other related taxes and expenses shall be borne by the Pledgor. If related taxes is borne by the Pledgee in accordance with laws, then the Pledgor shall fully indemnify the Pledgee all the taxes withheld by the Pledgee.

 

12. Force Majeure

 

  12.1 “Force Majeure Event” shall mean any event beyond the reasonable controls of the Party so affected, which are unpredictable, unavoidable, irresistible even if the affected Party takes a reasonable care, including but not limited to governmental acts, Act of God, fires, explosion, geographical variations, storms, floods, earthquakes, morning and evening tides, lightning or wars, riot, strike, and any other such events that all Parties have reached a consensus upon. However, any shortage of credits, funding or financing shall not be deemed as the events beyond reasonable controls of the affected Party.
     
  12.2 In the event that the performance of this Agreement is delayed or interrupted due to the said Force Majeure Event, the affected Party shall be excused from any liability to the extent of the delayed or interrupted performance. The affected Party which intends to seek exemption from its obligations of performance under this Agreement or any provision of this Agreement shall immediately inform the other Party of such a Force Majeure Event and the measures it needs to take in order to complete its performance.

 

13. Dispute Resolution

 

  13.1 The formation, validity, performance and interpretation of this Agreement and the disputes resolution under this Agreement shall be governed by the PRC laws.
     
  13.2 The Parties shall strive to settle any dispute arising from or in connection with this Agreement through friendly consultation. In case no settlement can be reached through consultation within thirty (30) days after the request for consultation is made by any Party, any Party can submit such matter to China International Economic and Trade Arbitration Commission for arbitration in accordance with its then effective rules. The arbitration shall take place in Beijing. The arbitration award shall be final and binding upon all the Parties.

 

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14. Notices

 

Notices or other communications required to be given by any Party pursuant to this Agreement shall be made in writing and delivered personally or sent by mail or facsimile transmission to the addresses of the other Parties set forth below or other designated addresses notified by such other Parties to such Party from time to time. The date when the notice is deemed to be duly served shall be determined as the follows: (a) a notice delivered personally is deemed duly served upon the delivery; (b) a notice sent by mail is deemed duly served on the seventh (7th) day after the date when the air registered mail with postage prepaid has been sent out (as is shown on the postmark), or the fourth (4th) day after the delivery date to the internationally recognized courier service agency; and (c) a notice sent by facsimile transmission is deemed duly served upon the receipt time as is shown on the transmission confirmation of relevant documents.

 

If to the Pledgee: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

Address: A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

Phone: 86-

Attention: Yongning Jia

 

If to the Pledgor: Zeyao Xue

 

Address: 23F, China Development Bank Tower, No. 2 Gaoxin 1st Road, Xi'an, Shaanxi

Phone: 

 

15. Miscellaneous

 

  15.1 The headings contained in this Agreement are for the convenience of reference only and shall not be used to interpret, explain or otherwise affect the meaning of the provisions of this Agreement.
     
  15.2 The Parties agree to promptly execute any document and take any other action reasonably necessary or advisable to perform provisions and purpose of this Agreement.
     
  15.3 The Parties confirm that this Agreement shall, upon its effectiveness, constitute the entire agreement and common understanding of the Parties with respect to the subject matters herein and fully supersede all prior verbal and/or written agreements and understandings with respect to the subject matters herein.
     
  15.4 The Parties may amend and supplement this Agreement in writing. Any amendment and/or supplement to this Agreement duly signed by the Parties is an integral part of and has the same effect with this Agreement.
     
  15.5 Any Party’s failure to exercise the rights under this Agreement in time shall not be deemed as its waiver of such rights and would not affect its future exercise of such rights.

 

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  15.6 If any provision of this Agreement is held void, invalid or unenforceable by a court of competent jurisdiction, governmental agency or arbitration authority, the validity, legality and enforceability of the other provisions hereof shall not be affected or impaired in any way. The Parties shall cease performing such void, invalid or unenforceable provisions and revise suchvoid, invalid or unenforceable provisions only to the extent closest to the original intention thereof to recover its validity or enforceability for such specific facts and circumstances.
     
  15.7 Any schedule hereto is an integral part of and has the same effect with this Agreement.
     
  15.8 This Agreement is made in five (5) originals with each Party holding one (1) original. And other originals are submitted to the AIC for proceeding with the formalities of registration of pledge of equity interests.

 

[No text below]

 

9

 

 

(Signature Page)

 

IN WITNESS THEREOF, each Party has signed or caused its legal representative to sign this Agreement as of the date first written above.

 

Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd

 

/s/ Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd

 

(Seal of Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd)

 

Signature of authorized representative: /s/ Yongning Jia                                  

 

Party B: Zeyao Xue  
   
By: /s/ Zeyao Xue  

 

Party C: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

/s/ Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

(Seal of Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.)

 

Signature page for the Equity Pledge Agreement

 

10

 

 

Schedule 1:

 

Register of Shareholders of Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

Name of Shareholder   Shareholding Percentage     Registration of Pledge

Zeyao Xue

 

    90 %   In accordance with the Equity Pledge Agreement by and among Zeyao Xue, Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019, Zeyao Xue has pledged all the equity interests held by him to Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

Kai Xu

 

    10 %   In accordance with the Equity Pledge Agreement by and among Kai Xu, Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019, Kai Xu has pledged all the equity interests held by him to Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

 

                                                         (Seal )      

Legal representative (signature)

Date:                                                 

 

11

 

 

Schedule 2:

 

Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

Capital Contribution Certificate (No.: 001)

 

Company: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

Date of Incorporation: April 04, 2019

Registered Capital: RMB 188,880,000

Shareholder: Zeyao Xue

Shareholder Ownership of E-commerce Tianjin: 90% of all equity interest of Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

In accordance with the Equity Pledge Agreement by and among Zeyao Xue, Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019, Zeyao Xue has pledged all the equity interests held by him to Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

  Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.
   
  Signature: (Seal)                                                
  Name: Yongning Jia
  Title: Legal representative
  Date: July 31, 2019

 

12

 

 

Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

Capital Contribution Certificate (No.: 002)

 

Company: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

Date of Incorporation: April 04, 2019

Registered Capital: RMB 188,880,000

Shareholder: Kai Xu

Shareholder Ownership of E-commerce Tianjin: 10% of all equity interest of Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

In accordance with the Equity Pledge Agreement by and among Kai Xu, Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019, Kai Xu has pledged all the equity interests held by him to Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

  Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.
   
  Signature: (Seal)                                                
  Name: Yongning Jia
  Title: Legal representative
  Date: July 31, 2019

 

 

13

 

Exhibit 10.5  

 

Equity Pledge Agreement

 

This EQUITY PLEDGE AGREEMENT, (this “ Agreement ”), dated July 31, 2019, is made in Tianjin, the People’s Republic of China (“ PRC ”) by and among:

 

Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

 

Party B: Kai Xu ;

 

Party C: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

 

(Party B is referred to as “Pledgor” hereinafter; Party A is referred to as “Pledgee” hereinafter; and either the Pledgor or the Pledgee is individually referred to as a “Party” and collectively referred to as the “Parties”.)

 

Whereas,

 

(1) Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. (“E-commerce Tianjin”) is a limited liability company duly incorporated and validly existing under the PRC laws, with the registered share capital of RMB 188.88 million.

 

(2) The Pledgor holds 10% of total equity interests of E-commerce Tianjin. The amount of pledged debt equals the value of the Pledged Equity Interests as defined below, together with obligations under the relevant agreements.

 

(3) The Pledgee is a wholly foreign owned company duly incorporated and existing under the laws of the PRC.

 

(4) The Pledgee and E-commerce Tianjin entered into an Exclusive Technology Consulting and Service Agreement on July 31, 2019 (“Services Agreement”).

 

(5) The Pledgor, E-commerce Tianjin and the Pledgee entered into an Exclusive Purchase Option Agreement on July 31, 2019 (“Exclusive Purchase Option Agreement”). In addition, the Pledgor delivered the Power of Attorney to the Pledgee on July 31, 2019 (“Power of Attorney”, together with the Services Agreements and Exclusive Purchase Option Agreement, collectively referred as “Master Agreement”).

 

(6) In order to secure the Pledgor’s performance of his obligations under this Agreement and the Master Agreement, and in order to ensure E-commerce Tianjin to be able to perform its obligations under the Services Agreements, the Pledgor hereby pledges all the equity interests held by him in E-commerce Tianjin as the guaranty for his and/or E-commerce Tianjin’s performance of obligations under the Master Agreement.

 

 

 

 

NOW, THEREFORE, the Parties hereby agree as follows through friendly negotiations:

 

1. Definition

 

Unless otherwise specified herein, the following words shall have the meanings as follows:

 

1.1 Pledge Right: means the priority right the Pledgee owns, with respect to the proceedings arising from selling at a discount, auction of, or selling off the equity interests pledged by the Pledgor to the Pledgee.
     
1.2 Pledged Equity Interests: means all the equity interests duly held by the Pledgor in E-commerce Tianjin, i.e. 10% equity interests of E-commerce Tianjin, as well as all the other rights created over it.
     
1.3 Term of Pledge: means the period of term specified in Article 3 hereof.

 

1.4 Event of Default: means any of the circumstances listed in Article 7 hereof.

 

1.5 Notice of Default: means any notice issued by the Pledgee to the Pledgor in accordance with this Agreement specifying an Event of Default.
     
2. Pledge Right and Scope of Guaranty

 

2.1 The Pledgor agrees to pledge all the Pledged Equity Interests to the Pledgee as the guaranty for his and/or E-commerce Tianjin’s performance of all the obligations under the Master Agreement and all the liabilities of indemnification to the Pledgee which may arise due to the invalidity or cancellation of the Master Agreement. E-commerce Tianjin agrees with such equity pledge arrangement.

 

2.2 The effect of guaranty under the Master Agreement will not be prejudiced by any amendment or change of the Master Agreement. The invalidity or cancellation of the Master Agreement does not impair the validity of this Agreement. In the event that the Master Agreement is deemed as invalid, or cancelled or revoked for any reason, the Pledgee is entitled to realize its pledge right in accordance with Article 8 hereof.
     
3. Creation and Term of Pledge

3.1 The Pledge Right hereunder shall be reflected on the register of shareholders and the capital contribution certificate in accordance with the form as attached to this Agreement.

3.2 The term of the Pledge Right is effective from the registration of pledge of equity interests with the Administration for Industry and Commerce of the place where E-commerce Tianjin is registered, till the day on which all the obligations under the Master Agreement are fully performed (“Term of Pledge”).

3.3 During the Term of Pledge, if the Pledgor and/or E-commerce Tianjin fails to perform any obligation under or arising from the Master Agreement, the Pledgee has the right to dispose of the Pledge Right in accordance with Article 8 hereof.
     
4. Possession of Pledge Certificates

4.1 The Pledgor shall deliver the register of shareholders and capital contribution certificate of E-commerce Tianjin which reflects the pledge of equity interests as mentioned in above Article 3 within three (3) business days from the execution of this Agreement, to the Pledgee for its possession, and the Pledgee is obligated to keep the received pledge documents.
     
4.2 The Pledgee is entitled to all the proceeds in cash including the dividends and all the other non-cash proceeds arising from the Pledge Equity Interests since July 31, 2019.

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5. Representations and Warranties of the Pledgor

5.1 The Pledgor is the legal owner of Pledged Equity Interests.

 

5.2 Once the Pledgee intends to exercise the rights of the Pledgee under this Agreement anytime, it shall be protected from any interference from any other party.
5.3 The Pledgee has the right to dispose of or transfer the Pledge Right in the way as described hereunder.

 

5.4 The Pledgor has never created any other pledge right or any other third party right over the Pledged Equity Interests except towards the Pledgee.

6. Covenants from the Pledgor

6.1 During the term of this Agreement, the Pledgor covenants to the Pledgee as follows:

6.1.1 Without prior written consent of the Pledgee, the Pledgor should not transfer the Pledged Equity Interests, or create or allow creation of any new pledge or any other security upon the Pledged Equity Interests which may impair the rights and/or interest of the Pledgee, except for the transfer of Pledged Equity Interests to the Pledgee or the person designated by the Pledgee in accordance with the Exclusive Purchase Option Agreement.
     
6.1.2 The Pledgor shall abide by and exercise all the provisions of laws and regulations in relation to the pledge of rights, and shall present the Pledgee any and all notices, directions or suggestions issued by related competent authorities within two (2) days upon the receipt of such notices, directions or suggestions, and shall comply with such notices, directions or suggestions, or present its opposite opinions and representations regarding the above mentioned issues according to the reasonable request of the Pledgee or with the consent from the Pledgee;
     
6.1.3 The Pledgor shall give prompt notice to the Pledgee regarding any occurrence or received notice which may influence the Pledged Equity Interests or any part of the Pledged Equity Interests held by the Pledgee, or may change any warranties or obligations of the Pledgor under this Agreement or may influence the performance of obligations by the Pledgor hereunder.
     
6.2 The Pledgor agrees that, the right of the Pledgee to exercise of Pledge Right hereunder in accordance with this Agreement, shall not be interfered or impaired by any legal proceedings taken by the Pledgor, or the successor or designated person of the Pledgor or any other person.

 

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6.3 The Pledgor warrants to the Pledgee that, in order to protect or consummate the guaranty provided by this Agreement regarding the performance of the Master Agreement, the Pledgor will faithfully sign, or cause any other party which is materially related to the Pledge Right to sign, any and all right certificates and deeds, and/or take, or cause any other party which is materially related to the Pledge Right to take, any and all actions, reasonably required by the Pledgee, and will facilitate the exercise of the rights and authorizations granted to the Pledgee under this Agreement, enter into any change to related equity certificate with the Pledgee or the Pledgee’s designated person (individual/legal person), and provide to the Pledgee any and all notices, orders and decisions as deemed necessary by the Pledgee.
     
6.4 The Pledgor undertakes to the Pledgee he will abide by and perform all representations, warranties and undertakings to protect the interests of the Pledgee. The Pledgor shall indemnify the Pledgee any and all losses suffered by the Pledgee due to the Pledgor’s failure or partial failure in performance of his representations, warranties or undertakings.
     
6.5 The Pledgor covenants to the Pledgee he assumes several and joint liabilities with respect to the obligations hereunder.
     

6.6 The Pledgor irrevocably agrees to waive the preemptive right with respect to the Pledged Equity Interests pledged by other shareholders of E-commerce Tianjin to the Pledgee, as well as the transfer of equity interests due to the exercise of Pledge Right by the Pledgee.
     
7. Event of Default

 

7.1 Any of the following is deemed as an Event of Default:

7.1.1 E-commerce Tianjin fails to perform its obligations under the Master Agreement;

 

7.1.2 Any representation or warranty of the Pledgor under this Agreement is substantially misleading or untrue, and/or the Pledgor breaches any of his representations and warranties under this Agreement;

 

7.1.3 The Pledgor breaches its covenants hereunder;

 

7.1.4 The Pledgor breaches any provision hereof;

 

7.1.5 Except that the Pledgor transfers the equity interests to the Pledgee or the Pledgee’s designated person in accordance with the Exclusive Purchase Option Agreement, the Pledgor waives the Pledged Equity Interests or transfers the Pledged Equity Interests without the written consent from the Pledgee;
     
7.1.6 Any external borrowings, guaranty, indemnification, undertakings or any other liabilities of the Pledgor (1) is required to be repaid or exercised early due to its default; or (2) is not repaid or exercised when due, which makes the Pledgee reasonably believes that the ability of the Pledgor to perform his obligations under this Agreement has been impaired.
     
7.1.7 The Pledgor fails to repay general debts or other liabilities;

 

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7.1.8 This Agreement is deemed to be illegal with promulgation of related laws, or the Pledgor is unable to continue to perform his obligations hereunder;

 

7.1.9 The consent, permit, approval or authorization from the competent authorities for making this Agreement enforceable, legal or valid is revoked, suspended, invalidated or materially amended;

 

7.1.10 Adverse change occur with respect to the assets of the Pledgor, which makes the Pledgee reasonably believes that the ability of the Pledgor to perform his obligations under this Agreement has been impaired.

 

7.1.11 Successor of the Pledgor or E-commerce Tianjin can only perform part of, or refuses to perform, its obligations under this Agreement.

 

7.1.12 Other circumstances occur which make the Pledgee unable to exercise or dispose of the Pledge Right in accordance with related laws.

 

7.2 In the event that is aware of or discover that any issue described in the above Article 7.1 or any other issue which may cause the occurrence of such mentioned issues has occurred, the Pledgor shall give a prompt written notice to the Pledgee.

 

7.3 Unless that the Event of Default specified in above Article 7.1 has been resolved to the satisfaction of the Pledgee, otherwise the Pledgee is entitled to (not obligated to) serve a Notice of Default to the Pledgor immediately following or any time after the occurrence of the Event of Default, to require the Pledgor and E-commerce Tianjin to immediately perform its obligations under the Master Agreement (including without limitation to payment of the due and unpaid debts and other amounts payable under the Services Agreements) or dispose of the Pledge Right in accordance with Article 8 hereof.

 

8. Exercise of Pledge Right

8.1 Prior to the fulfillment of performance of the obligations under the Master Agreement, the Pledgor should not transfer the Pledged Equity Interests without the written consent of the Pledgee.

 

8.2 In the event of occurrence of the Event of Default described in above Article 7, the Pledgee shall give a Notice of Default to the Pledgor when exercising the Pledge Right. The Pledgee may exercise the right to dispose of the Pledge Right at the same time of or any time after the service of the Notice of Default.

 

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8.3 The Pledgee has the right to sell in accordance with legal procedure or dispose of in the other way allowed by law the Pledged Equity Interests hereunder. If the Pledgee decides to exercise the Pledge Right, the Pledgor undertakes to transfer all of his shareholder rights to the Pledgee for exercise. In addition, the Pledgee has the priority to receive the proceedings arising from selling at a discount, auction of, or selling off the equity interests pledged by the Pledgor to the Pledgee according to the legal proceedings.

 

8.4 When the Pledgee is disposing of the Pledge Right in accordance with this Agreement, the Pledgor should not create any obstacle, and shall provide any necessary assistance to help the Pledgee to realize the Pledge Right.

 

9. Transfer of Agreement

9.1 Unless with the prior consent from the Pledgee, the Pledgor has no right to grant or transfer any of his rights and obligations hereunder.

 

9.2 This Agreement is binding upon the Pledgor and his successor, as well as the Pledgee, and its successors and assignees permitted by the Pledgee.
     
9.3 The Pledgee is entitled to transfer any or all rights and obligations under the Master Agreement to any person (individual/legal person) designated by it at anytime. Under this circumstance, the assignee have the same rights and obligations as the Pledgee under this Agreement, as if such rights and obligations are granted to it as a party to this Agreement. When transferring the rights and obligations under the Services Agreements, this Agreement, the Exclusive Purchase Option Agreement and/or Power of Attorney, the Pledgor shall sign any and all related agreement and/or documents as required by the Pledgee.

 

9.4 With the change of pledgee due to the transfer, all the parties to the new pledge shall enter into a new pledge contract, which shall be substantially same to this Agreement in the content and to the satisfaction of the Pledgee.

 

10. Effectiveness and Termination

10.1 This Agreement becomes effective on the date hereof. All Parties agree and confirm that the terms and conditions hereof become effective since July 31, 2019.
     
10.2 The Parties confirm that whether the pledge hereunder has been registered and recorded or not will not impair the effectiveness and validity of this Agreement.

 

10.3 This Agreement will terminate two (2) years after the Pledgor and /or E-commerce Tianjin no longer assume any liability under or arising from the Master Agreement.
     

10.4 Release of pledge shall be recorded accordingly on the register of shareholders of E-commerce Tianjin and related deregistration formalities shall be proceeded with at the Administration for Industry and Commerce of the place where E-commerce Tianjin is registered.

 

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11. Processing Fee and Other Costs

All fees and actual costs related to this Agreement, including not limited to legal fees, processing fee, duty stamp and all the other related taxes and expenses shall be borne by the Pledgor. If related taxes is borne by the Pledgee in accordance with laws, then the Pledgor shall fully indemnify the Pledgee all the taxes withheld by the Pledgee.

 

12. Force Majeure

12.1 “Force Majeure Event” shall mean any event beyond the reasonable controls of the Party so affected, which are unpredictable, unavoidable, irresistible even if the affected Party takes a reasonable care, including but not limited to governmental acts, Act of God, fires, explosion, geographical variations, storms, floods, earthquakes, morning and evening tides, lightning or wars, riot, strike, and any other such events that all Parties have reached a consensus upon. However, any shortage of credits, funding or financing shall not be deemed as the events beyond reasonable controls of the affected Party.
     
12.2 In the event that the performance of this Agreement is delayed or interrupted due to the said Force Majeure Event, the affected Party shall be excused from any liability to the extent of the delayed or interrupted performance. The affected Party which intends to seek exemption from its obligations of performance under this Agreement or any provision of this Agreement shall immediately inform the other Party of such a Force Majeure Event and the measures it needs to take in order to complete its performance.

 

13. Dispute Resolution

13.1 The formation, validity, performance and interpretation of this Agreement and the disputes resolution under this Agreement shall be governed by the PRC laws.
     
13.2 The Parties shall strive to settle any dispute arising from or in connection with this Agreement through friendly consultation. In case no settlement can be reached through consultation within thirty (30) days after the request for consultation is made by any Party, any Party can submit such matter to China International Economic and Trade Arbitration Commission for arbitration in accordance with its then effective rules. The arbitration shall take place in Beijing. The arbitration award shall be final and binding upon all the Parties.

 

14. Notices

Notices or other communications required to be given by any Party pursuant to this Agreement shall be made in writing and delivered personally or sent by mail or facsimile transmission to the addresses of the other Parties set forth below or other designated addresses notified by such other Parties to such Party from time to time. The date when the notice is deemed to be duly served shall be determined as the follows: (a) a notice delivered personally is deemed duly served upon the delivery; (b) a notice sent by mail is deemed duly served on the seventh (7th) day after the date when the air registered mail with postage prepaid has been sent out (as is shown on the postmark), or the fourth (4th) day after the delivery date to the internationally recognized courier service agency; and (c) a notice sent by facsimile transmission is deemed duly served upon the receipt time as is shown on the transmission confirmation of relevant documents.

 

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If to the Pledgee: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 


Address:A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

Phone: 86-

Attention: Yongning Jia

 

If to the Pledgor: Kai Xu

 

Address: A-19 Zhongguancun Kexin Industrial Park, Shuangjie Town, Beichen District, Tianjin

Phone: 86-

 

15. Miscellaneous

15.1 The headings contained in this Agreement are for the convenience of reference only and shall not be used to interpret, explain or otherwise affect the meaning of the provisions of this Agreement.
     
15.2 The Parties agree to promptly execute any document and take any other action reasonably necessary or advisable to perform provisions and purpose of this Agreement.
     
15.3 The Parties confirm that this Agreement shall, upon its effectiveness, constitute the entire agreement and common understanding of the Parties with respect to the subject matters herein and fully supersede all prior verbal and/or written agreements and understandings with respect to the subject matters herein.
     
15.4 The Parties may amend and supplement this Agreement in writing. Any amendment and/or supplement to this Agreement duly signed by the Parties is an integral part of and has the same effect with this Agreement.
     
15.5 Any Party’s failure to exercise the rights under this Agreement in time shall not be deemed as its waiver of such rights and would not affect its future exercise of such rights.
     
15.6 If any provision of this Agreement is held void, invalid or unenforceable by a court of competent jurisdiction, governmental agency or arbitration authority, the validity, legality and enforceability of the other provisions hereof shall not be affected or impaired in any way. The Parties shall cease performing such void, invalid or unenforceable provisions and revise suchvoid, invalid or unenforceable provisions only to the extent closest to the original intention thereof to recover its validity or enforceability for such specific facts and circumstances.
     
15.7 Any schedule hereto is an integral part of and has the same effect with this Agreement.
 
15.8 This Agreement is made in five (5) originals with each Party holding one (1) original. And other originals are submitted to the AIC for proceeding with the formalities of registration of pledge of equity interests.
[No text below]

 

8

 

 

(Signature Page)

 

IN WITNESS THEREOF, each Party has signed or caused its legal representative to sign this Agreement as of the date first written above.

 

Party A: Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd

 

/s/ Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd

 

(Seal of Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd)

 

Signature of authorized representative: /s/ Yongning Jia                                  

 

Party B: Kai Xu  
   
By: /s/ Kai Xu  

  

Party C: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

/s/ Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

(Seal of Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.)

 

Signature page for the Equity Pledge Agreement

 

9

 

 

Schedule 1:

 

Register of Shareholders of Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

Name of Shareholder

 

Shareholding Percentage

   

Registration of Pledge

Zeyao Xue
    90 %   In accordance with the Equity Pledge Agreement by and among Zeyao Xue, Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019, Zeyao Xue has pledged all the equity interests held by him to Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

Kai Xu

 

    10 %   In accordance with the Equity Pledge Agreement by and among Kai Xu, Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019, Kai Xu has pledged all the equity interests held by him to Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

 

                                                         (Seal )     

 

Legal representative (signature)

Date:                                               

 

10

 

 

Schedule 2:

 

Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

Capital Contribution Certificate (No.: 001)

 

Company: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

Date of Incorporation: April 04, 2019

Registered Capital: RMB 188,880,000

Shareholder: Zeyao Xue

Shareholder Ownership of E-commerce Tianjin: 90% of all equity interest of Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

 

In accordance with the Equity Pledge Agreement by and among Zeyao Xue, Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019, Zeyao Xue has pledged all the equity interests held by him to Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

  Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.
   
  Signature: (Seal)                                                
  Name: Yongning Jia
  Title: Legal representative
  Date: July 31, 2019

 

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Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

Capital Contribution Certificate (No.: 002)

 

Company: Chain Cloud Mall E-commerce (Tianjin) Co., Ltd.

Date of Incorporation: April 04, 2019

Registered Capital: RMB 188,880,000

Shareholder: Kai Xu

Shareholder Ownership of E-commerce Tianjin: 10% of all equity interest of Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

In accordance with the Equity Pledge Agreement by and among Kai Xu, Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd and Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019, Kai Xu has pledged all the equity interests held by him to Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd.

 

  Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. (seal)
   
  Signature: (Seal)                                                
  Name: Yongning Jia
  Title: Legal Representative
  Date: July 31, 2019

 

 

12

 

 

Exhibit 10.6

 

 Power of Attorney

 

The undersigned, Zeyao Xue, a citizen of the People’s Republic of China (the “PRC”) and a holder of 90% of the equity interests of Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. (the “Tianjin Company”) (the “Shareholding”), hereby irrevocably authorizes any natural person appointed by Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd. (the “WFOE”) to exercise the following rights during the term of this Power of Attorney:

 

Any natural person appointed by the WFOE is hereby authorized to exercise on behalf of the undersigned as his sole and exclusive agent the rights in respect of the Shareholding including without limitation: (1) attend shareholders’ meeting of the Tianjin Company and sign resolutions thereof on behalf of the undersigned; (2) exercise all rights of the undersigned as a shareholder of the Tianjin Company according to laws and the articles of association of the Tianjin Company, including without limitation the rights to vote and to sell, transfer, pledge or dispose all or any part of the Shareholding; and (3) designate and appoint on behalf of the undersigned the legal representative, chairperson, director, supervisor, chief executive officer and any other senior management of the Tianjin Company.

 

Subject to the powers and authorities provided under this Power of Attorney, any natural person appointed by the WFOE will have the right to sign on behalf of the undersigned any transfer agreement contemplated under the Exclusive Purchase Option Agreement to which the undersigned will be a party, and to perform the Equity Pledge Agreement and the Exclusive Purchase Option Agreement, each of which is dated the date hereof and to which the undersigned is a party. Exercise of such right will not have any restriction upon this Power of Attorney.

 

Unless otherwise provided under this Power of Attorney, any natural person appointed by the WFOE has the right to transfer, apply or otherwise dispose any cash dividend, bonus and any other non-cash gain arising from the Shareholding without reliance of any oral or written instruction from the undersigned.

 

Unless otherwise provided under this Power of Attorney, any natural person appointed by the WFOE has the right to take any action regarding the Shareholding according to his/her own judgment without any oral or written instruction from the undersigned.

 

Any and all the actions associated with the Shareholding made by any natural person appointed by the WFOE will be deemed as the action of the undersigned, and any and all documents relating to the Shareholding executed by any natural person appointed by the WFOE shall be deemed to be executed and acknowledged by the undersigned.

 

Any natural person appointed by the WFOE may delegate this power of attorney by assigning his/her rights relating to the conduct of the aforesaid matter and exercise of the Shareholding to any other person or entity at his/her own discretion without prior notice to or consent from the undersigned.

 

This Power of Attorney is irrevocable and effective as of the date hereof as long as the undersigned is a shareholder of the Tianjin Company. This Power of Attorney supersedes any other power of attorney previously signed by the undersigned.

 

During the term of this Power of Attorney, the undersigned hereby waives all of the rights associated with the Shareholding which have been authorized to any natural person appointed by the WFOE and will not exercise any such right by himself.

 

 

By: /s/ Zeyao Xue                                        
Dated: July 31, 2019  

 

 

 

Exhibit 10.7

 

Power of Attorney

 

The undersigned, Kai Xu, a citizen of the People’s Republic of China (the “PRC”) and a holder of 10% of the equity interests of Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. (the “Tianjin Company”) (the “Shareholding”), hereby irrevocably authorizes any natural person appointed by Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd. (the “WFOE”) to exercise the following rights during the term of this Power of Attorney:

 

Any natural person appointed by the WFOE is hereby authorized to exercise on behalf of the undersigned as his sole and exclusive agent the rights in respect of the Shareholding including without limitation: (1) attend shareholders’ meeting of the Tianjin Company and sign resolutions thereof on behalf of the undersigned; (2) exercise all rights of the undersigned as a shareholder of the Tianjin Company according to laws and the articles of association of the Tianjin Company, including without limitation the rights to vote and to sell, transfer, pledge or dispose all or any part of the Shareholding; and (3) designate and appoint on behalf of the undersigned the legal representative, chairperson, director, supervisor, chief executive officer and any other senior management of the Tianjin Company.

 

Subject to the powers and authorities provided under this Power of Attorney, any natural person appointed by the WFOE will have the right to sign on behalf of the undersigned any transfer agreement contemplated under the Exclusive Purchase Option Agreement to which the undersigned will be a party, and to perform the Equity Pledge Agreement and the Exclusive Purchase Option Agreement, each of which is dated the date hereof and to which the undersigned is a party. Exercise of such right will not have any restriction upon this Power of Attorney.

 

Unless otherwise provided under this Power of Attorney, any natural person appointed by the WFOE has the right to transfer, apply or otherwise dispose any cash dividend, bonus and any other non-cash gain arising from the Shareholding without reliance of any oral or written instruction from the undersigned.

 

Unless otherwise provided under this Power of Attorney, any natural person appointed by the WFOE has the right to take any action regarding the Shareholding according to his/her own judgment without any oral or written instruction from the undersigned.

 

Any and all the actions associated with the Shareholding made by any natural person appointed by the WFOE will be deemed as the action of the undersigned, and any and all documents relating to the Shareholding executed by any natural person appointed by the WFOE shall be deemed to be executed and acknowledged by the undersigned.

 

Any natural person appointed by the WFOE may delegate this power of attorney by assigning his/her rights relating to the conduct of the aforesaid matter and exercise of the Shareholding to any other person or entity at his/her own discretion without prior notice to or consent from the undersigned.

 

This Power of Attorney is irrevocable and effective as of the date hereof as long as the undersigned is a shareholder of the Tianjin Company. This Power of Attorney supersedes any other power of attorney previously signed by the undersigned.

 

During the term of this Power of Attorney, the undersigned hereby waives all of the rights associated with the Shareholding which have been authorized to any natural person appointed by the WFOE and will not exercise any such right by himself.

 

 

By: /s/ Kai Xu                                           
Dated: July 31, 2019