This Equity Pledge Agreement (hereinafter this
“Agreement”) is dated June 23, 2008, and entered into
in Xi’an, China by Xi'an Jiahui Real Estate Co., Ltd
("Jiahui"), with a registered address at 89 Chang’an Middle
Rd., Yangming Int’l Tower 27 th Floor,
Xi’an, Shaanxi, China (“Pledgee”), and each of
the shareholders of Party B listed on the signature pages hereto
(collectively, the “Pledgors”), and Shaanxi Xinyuan
Real Estate Co. Ltd., with a registered address at 89
Chang’an Middle Rd., Yangming Int’l Tower 26
th Floor, Xi’an, Shaanxi, China (“Party
B” or “Company”),
RECITALS
1. The Pledgee, a wholly foreign owned limited
company incorporated under law of China, has the expertise in the
business of real estate development, including sale and lease of
real estate.
2. The Pledgors are shareholders of the Company
and collectively own 100% of the outstanding equity interests of
the Company.
3. Pledgee and the Company have executed a
Consulting Services Agreement (hereinafter “ Consulting
Services Agreement ” or “ Services Agreement
”) concurrently herewith. Based on this agreement, The
Company shall pay technical consulting and service fees
(hereinafter the “ Consulting Services Fees ” or
“ Services Fees ”) to Pledgee for offering
consulting and related services. In addition, the parties
have contemporaneously entered into other agreements with respect
to business, operations, ownership and management of Party B.
4. In order to ensure that the Company will
perform its obligations under the Consulting Services Agreement and
the various other operation agreements described above, and in
order to provide an additional mechanism for the Pledgee to enforce
its rights to collect the Consulting Services Fees from the
Company, the Pledgors agree to pledge all their equity interest in
the Company as security for the performance of the obligations of
the Company under the Consulting Services Agreement and the payment
of Consulting Services Fees under such agreement.
NOW
THEREFORE , the Pledgee, the Company and the Pledgors through
mutual negotiations hereby enter into this Agreement based upon the
following terms:
1. Definitions and Interpretation
. Unless otherwise provided in this Agreement, the following terms
shall have the following meanings:
1.1 “ Pledge ” refers to the
full content of Section 2 hereunder.
1.2 “ Equity Interest ” refers
to all the equity interest in the Company legally held by the
Pledgors.
1.3 “
Term of Pledge ” refers
to the period provided for under Section 3.2 hereunder.
1.4 “
Event of Default ” refers
to any event in accordance with Section 7.1 hereunder.
1.5 “
Notice of Default ”
refers to the notice of default issued by the Pledgee in accordance
with this Agreement.
2.
Pledge . The Pledgors agree to
pledge their equity interest in the Company to the Pledgee (“
Pledged Collateral ”) as a security for the
obligations of the Company under the Consulting Services Agreement
and to ensure the performance of the various other operation
agreements among the parties hereto. Pledge under this Agreement
refers to the rights owned by the Pledgee, who shall be entitled to
a priority in receiving payment by the evaluation or proceeds from
the auction or sale of the equity interest pledged by the Pledgors
to the Pledgee.
3.
Term of Pledge .
3.1 The Pledge shall take effect as of the date
when the Pledge of the equity interest under this Agreement is
recorded in the Register of Shareholder of The Company. The term of
the Pledge shall last until two (2) years after the obligations
under the Consulting Services Agreement and other related
agreements are fulfilled.
3.2 During the term of the Pledge, the Pledgee
shall be entitled to vote, control, sell, or dispose of the pledged
assets in accordance with this Agreement in the event that Pledgors
do not perform their obligation under the Consulting Services
Agreement and the Company fails to pay the Consulting Service Fees
in accordance with the Consulting Services Agreement.
3.3 During the term of the Pledge, the Pledgee
shall be entitled to collect any and all dividends declared or paid
in connection with the equity interest.
4.
Pledge Procedure and
Registration
4.1 The Pledge under this Agreement shall be
recorded in the Register of Shareholders of the Company. The
Pledgor shall, within 10 days after the date of this Agreement,
process the registration procedures with Administration for
Industry and Commerce concerning the Pledge.
