Exhibit 10.2
Equity Pledge Agreement
By and
among
The Shareholder of Qingdao Niao
Bio-Technology Ltd.
Qingdao Niao Bio-Technology
Ltd.
and
NeoStem (China),
Inc.
June 1, 2009
EQUITY PLEDGE
AGREEMENT
THIS EQUITY
PLEDGE AGREEMENT (hereinafter referred to as “this
Agreement”) is executed by the following parties on June 1,
2009 in Qingdao City, the People’s Republic of China ( the
“PRC”):
(1) Sole
shareholder of Qingdao Niao Bio-Technology Ltd.
(hereinafter
as “Party A” or “Pledgor”)
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Name of the
Shareholder
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Shareholding
Ratio
（
% ）
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ID Card No.
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Contact Address
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Liu Hongbing
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100
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Room 102, Unit
4 Building 6, No.138 Huaneng Road, Licheng District, Ji’nan
City
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(2) NeoStem
(China), Inc. (hereinafter as “Party B” or
“Pledgee”)
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Registered
Address: Room 0425A, Building C, No.6 XiangGangZhong Road, Shinan
District, Qingdao City
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Legal Representative: Robin Smith
(3) Qingdao
Niao Bio-Technology Ltd. (hereinafter as “Party C” or
the “Company”)
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Registered
Address: Room 501, Unit 2 Building 1, No.17 YinChuanDong Road,
Laoshan District, Qingdao City
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Legal Representative: Liu Hongbing
(Pledgor, Pledgee and the Company may be
collectively called the “Parties” and individually as
“Each Party”.)
WHEREAS,
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The Company is
a domestic company incorporated and validly existing under PRC
Laws, and its business license No. is 370212230011070
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The Pledgor,
the PRC citizen ，
legally holds 100% Equity Interests
in the Company;
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The Pledgee, as
a wholly foreign-owned enterprise, was duly incorporated and
validly existing under the PRC Laws;
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Party B signed
a consigned management and technology service agreement (the
“Consigned Management and Technology Service
Agreement”) on June 1, 2009 with Party C and Party A, and
Party A agrees to pledge all his equities in Party C to Party B as
a guaranty for the performance of the obligations
thereunder.
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The Parties
signed an exclusive purchase option agreement (the “Exclusive
Purchase Option Agreement”) on June 1, 2009, and the Parties
thereto agree that Party A shall pledge all his equities in Party C
to Party B as a guaranty of the performance of the obligations
assumed by Party A and Party C thereunder.
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Party A and
Party B signed a loan agreement (the “Loan Agreement”)
on June 1, 2009, and the Party A agrees to pledge all his equities
in Party C to Party B as a guaranty of the performance of the
obligations thereunder.
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NOW
THEREFORE , the Parties,
through friendly negotiations, hereby enter into this Agreement
with respect to the equity pledge.
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1.
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Definitions
and Interpretation
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Unless otherwise provided in
this Agreement, the following terms shall have the following
meanings:
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1.1
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“PRC” refers to the People’s
Republic of China, excluding the HongKong Special Administrative
Region, Macao Special Administrative Region and Taiwan
Province;
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1.2
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“PRC
Laws” refers to all PRC laws, administrative regulations and
government rules in effect;
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1.3
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“Pledged
Equity” refers to all the equity in the Company as provided
in Article2.1;
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1.4
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“Main
Agreements” refers to the Loan Agreement, Consigned
Management and Technology Service Agreement and Exclusive Purchase
Option Agreement and the Appendixes thereof (if
applicable);
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1.5
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“Right of
Pledge” refers to the right owned by the Pledgee to be first
compensated from the money converted from or the proceeds from the
auction or sale of the Pledged Equity by the Pledgor to the Pledgee
in the event of default of Pledgor and/or Party C, and such right
shall cause the Pledgee to be entitled to the bonus arising from
Pledged Equity;
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1.6
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“AICB” refers to the competent
Administration Bureau of Industry and Commerce which is authorized
in accordance with PRC Laws to register the Pledged Equity
hereunder;
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1.7
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“Event of
Default” refers to the event as defined in Article 8
hereunder.
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1.8
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“Business
Day” refers to any day except Saturday, Sunday and other
public holidays as permitted by PRC Laws;
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2.1
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The Parties
agree that Pledgor shall pledge all his Equities in the Company to
the Pledgee as a guaranty for the performance of the obligations
assumed by the Pledgor and/or the Company under each of the Main
Agreements.
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In case the
Pledgor increase the registered capital in the Company during the
term of this Agreement, such increased capital shall be equally
deemed as the Pledged Equity.
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2.3
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In case any act
conducted by the Pledgor or the Company may cause the Right of
Pledge damaged so as to harm the interests of the Pledgee, the
Pledgee is entitled to require the Pledged Equity to be auctioned
or sold in advance and the proceeds from such auction or sale shall
be used to discharge the debt secured by the Pledged Equity in
advance.
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3.
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Registration
of Pledge
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Upon the
execution of this Agreement, the Pledgor shall cause the Company to
record the Right of Pledge in the register of shareholders and
deliver it with the common seal of the Company as well as the
original of equity contribution certificate of the Pledgor to the
Pledgee for keeping. Within the term of this Agreement, Party B
shall return the register of shareholders and equity contribution
certificate to the Company for modification registration with AICB,
and the Company shall complete the modification registration within
10 business days upon receipt of the register of
shareholders and equity contribution certificate, and Party A
together with the Company shall continue to deliver such modified
register of shareholders and equity contribution certificate to
Party B within 2 business days following the completion of the
aforesaid registration.
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3.2
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The Parties
agree that if AICB accept the registration with respect to the
equity pledge, he will promptly cause the Pledged Equity under this
Agreement to be recorded at AICB, and the Parties confirm that
whether the Pledged Equity is recorded as above or not shall not
affect the validity of this Agreement unless compulsorily required
by PRC Laws.
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3.3
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After the
signing of this Agreement, the Pledgor shall in accordance with the
Pledgee’s written request which may be made by the Pledgee
from time to time, together with the Pledgee, notarized this
agreement as well as the register of shareholders with the recorded
Pledged Equity in a notary public office as designated by the
Pledgee, and Party A and the Company shall give assistant with
respect to the notarization following the delivery of the notice
with the request of notarization by Party B.
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4.
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Representations and Warranties
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4.1
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Each Party
under this Agreement represents and warrants to other Parties that:
(1) it has relevant power, rights and authorizations for the
execution hereof, and performance of the obligations
hereunder;
(2) the
execution and performance of this Agreement shall not violate or
conflict with any of the terms and conditions of other agreements
signed between the Parties.
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4.2
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The Pledgor
represent and warrant to the Pledgee that:
(1) he is the
legal owner of the Pledged Equity, and have fulfilled the
obligations of capital contribution in the registered capital of
the Company;
(2) except for
the Right of Pledge as setup hereunder, the Pledged Equity is not
subject to any pledge, guaranty or other form of
encumbrances;
(3) he does not
or will not transfer the Pledged Equity to any third party or make
any agreements, whether oral or written, with respect to the
transfer of Pledged Equity.
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The Company
agrees to undertake the joint liability with respect to the
representations and warrants made by the Pledgor.
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5.
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Obligations
of Pledgor
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The dividend
and bonus arising from the Pledged Equity shall be deposited in an
escrow account for the supervision of the Pledgee.
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Apart from the
encumbrance set forth hereunder and under the Exclusive Purchase
Option Agreement, without the Pledgee’s prior written
consent, the Pledgor shall not sell, transfer, mortgage or
otherwise dispose of the Pledged Equity, nor shall place
encumbrances on such Pledged Equity;
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Without the
Pledgee’s prior written consent, the Pledgor shall not
supplement or amend the articles of association of the Company in
any manner, nor shall it increase or decrease the registered
capital or change the shareholding structure of the Company in any
manner;
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The Pledgor
shall not approve for the resolutions on the dissolution,
liquidation and change of legal form of the Company;
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The Pledgor
shall not approve for any Profit Distribution Proposal, nor shall
accept such distributed dividend without the Pledgee’s prior
written consent; At the Pledgee’s request, it shall promptly
approve for the Profit Distribution Proposal, and accept such
distributed dividend;
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At the
Pledgee’s request, the Pledgor shall provide the Pledgee with
all information regarding the business operation and financial
condition of the Company;
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The Pledgor
shall not incur or succeed to any debts or liabilities which may
adversely affect his equity interests in the Company without the
Pledgee’s prior written consent;
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The Pledgor
shall appoint, and appoint onl
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