Pledge Agreement, dated as of January 9, 2019, by and between Cellular Biomedicine Group Ltd. (HK) and China Merchants Bank Co., Ltd., Shanghai Branch

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1. Pledge Applied by Party B

Serial No.	Name	Quantity	Value	Pledge Rate	Term	Right (Ownership) No.	Ownership Certificate
1	Certificate of time deposit	one	US$17,000,000.00	100%	One year	0007675051

 

2. The pledge hereunder refers to the maximum pledge.

 

2.1 During the credit extension period, Party A may provide Party B (or the Authorized Applicant) with credit extension for multiple times within the Credit Line; the specific type and amount of credit extension, whether types of credit extension may be adjusted and specific use conditions etc. shall be subject to the content approved by Party A. If Party A adjusts the original opinions approved by itself in accordance with the application of Party B (or the Authorized Applicant) during the credit extension period, the approval opinion produced by Party A subsequently shall constitute the supplement and modification of the original one, and the rest can be done in the same manner.

 

 

2.2 Upon expiration of the credit extension period, if the loan, advance money or other credit line Party A provides with Party B (or the Authorized Applicant) under the Credit Extension Agreement still bears any balance, Party B shall apply the pledge to assume the guarantee liability within the pledge guarantee scope confirmed by Article 3 hereof; if Party A presses Party B (or the Authorized Applicant) for payment prior to the expiry date of the credit extension period in accordance with the Credit Extension Agreement and specific contract clauses, Party B shall apply the pledge to assume the guarantee liability within the pledge guarantee scope confirmed by Article 3 hereof as well.

 

2.3 Where Party A provides Party B (or the Authorized Applicant) with such credit businesses as commercial acceptance, L/C (including entrusted establishment of L/C and back-to-back credit, same as below), letter of guarantee, back letter of delivery, factoring and cross-border interconnected trade financing within the credit extension period, if Party A never advances any money for Party B or provides guarantee for any payment prior to the expiry date of the credit extension period, yet actually does so under the foregoing business item upon expiration thereof, Party B shall apply the pledge to assume the guarantee liability within the pledge guarantee scope confirmed by Article 3 hereof.

 

2.4 Where Party A and Party B (or the Authorized Applicant) reach an agreement on the term of specific business, interest rate and amount or change relevant agreements during the performance process of each business under the Credit Extension Agreement, or Party A adjusts the interest rate during the pledge guarantee period in accordance with the Credit Extension Agreement and/or the agreement of each specific business, it’s unnecessary to gain the consent of Party B or additionally notify Party B, which Party B shall recognize and exerts no influence on the pledge guarantee liability attributed to Party B hereunder.

 

2.5 If the document received by Party A for any L/C business under the Credit Extension Agreement is reviewed by Party A as existing discrepancy, which the Authorized Applicant accepts, Party B shall apply the pledge to assume the guarantee liability for the principal and interest of creditor’s rights generated from the external acceptance or payment conducted by Party A thereby. Party B is prohibited to propose any demurrer on the ground that it is absent for the acceptance of the discrepancy or that Party B is not notified for the discrepancy.

 

2.6 In terms of the modification of any L/C or letter of guarantee (or standby letter of credit) hereunder, or the extension of any forward L/C acceptance or due payment, it’s unnecessary to obtain the consent of Party B or additionally notify Party B, which Party B shall recognize and exerts no influence on the pledge guarantee liability attributed to Party B hereunder.

2.7 It is confirmed by Party B that, all the business agreements concluded by Party A and Party B (or the Authorized Applicant) for specific businesses hereunder (either single agreement/application form or framework agreement) shall constitute an inseparable component of the Credit Extension Agreement, and jointly stipulate the rights and obligations of specific businesses.

 

 

2.8 In terms of the letter of guarantee / guarantee for customs tax payment / guarantee for bill payment transacted by Party A as applied by Party B (or the Authorized Applicant), the transfer of relevant rights and interests thereof shall exert no influence on the guarantee obligation attributed to Party B hereunder. It is committed by Party B that, it shall not propose any demurrer on this ground.

 

3. Scope of Pledge Guarantee

 

3.1 The scope of pledge guarantee hereunder shall cover the loan Party A provides for Party B (or the Authorized Applicant) within the Credit Line under the Credit Extension Agreement, the total balance of other principal credited (no more than RMB one hundred million only) as well as interest, default interest, compound interest, liquidated damages, factoring charge, expense on recovering creditor’s rights and realizing pledge, and other related expenditures, including but not limited to:

 

3.1.1 Balance of loan principal issued by Party A in accordance with each specific contract under the Credit Extension Agreement and corresponding interests, default interests, compound interests, liquidated damages and related expenditures;

 

3.1.2 Balance of principal paid by Party A on behalf of Party B (or the Authorized Applicant) as a result of performing the commercial bill, L/C, letter of guarantee / guarantee for customs tax payment / guarantee for bill payment, letter of guarantee for delivery, corresponding interests, default interests, compound interests, liquidated damages and related expenditures, as well as debts owed by Party B to Party A due to the guarantee for commercial bill accepted by Party B (or the Authorized Applicant);

 

3.1.3 Balance of external payment entrusted by Party A for trade financing business under the Credit Extension Agreement and corresponding interests, default interests, compound interests, liquidated damages and related expenditures;

 

3.1.4 Creditor’s rights of Party B’s (or the Authorized Applicant’s) receivables transferred to Party A under the factoring business and corresponding liquidated damages for delay (overdue fine and expenditures), and/or the fundamental payment for acquisitions (fundamental payment for underwriting) paid by Party A to Party B (or the Authorized Applicant) by virtue of own capital or other funds of legal source as well as relevant factoring expense;

 

3.1.5 Advance money for Party B (or the Authorized Applicant) as a result of Party A’s performance of the obligations attributed to the issuing bank under the L/C reissued by other branch of China Merchants Bank subject to the entrustment of Party A upon request of Party B (or the Authorized Applicant), inward documentary bills generated from the issuance of such L/C, balance of the principal for pick-up guarantee, as well as corresponding interests, default interests, compound interests, liquidated damages and related expenditures;

 

3.1.6 All the debts owed by Party B (or the Authorized Applicant) under such businesses as derivatives transaction and gold lease;

3.1.7 Documentary credit or advance money assumed by Party A pursuant to specific business agreements for the purpose of repaying the coordination platform financing (no matter within the credit extension period or not), provided that Party A transacts such cross-border interconnected trade financing as entrusted establishment of L/C, entrusted overseas financing and cross border express trading for Party B (or the Authorized Applicant) under the Credit Extension Agreement, as well as corresponding interests, default interests, compound interests, liquidated damages and related expenditures;

 

3.1.8 Arrearages of specific business under / (name of agreement required) with serial number as   originally executed by Party A (or subordinates of Party A) or / and Party B (or the Authorized Applicant);

 

3.1.9 Expenses (including but not limited to litigation fees, attorney’s fees, announcement fees, delivery fees and travel expense) incurred by Party A as a result of charging debts against Party B (or the Authorized Applicant) and realizing pledge.

 

3.2 In terms of the cyclical credit line, if the loan provided by Party A for Party B (or the Authorized Applicant) or the balance of other principal credited is over the Credit Line, Party B shall not assume the guarantee liability for the excessive part. Instead, it shall assume the guarantee liability for the loan or the balance of other principal credited within the Credit Line, as well as corresponding interests, default interests, liquidated damages, compound interests and related expenditures.

 

 

3.3 Where Party A transacts such debts as under repayment of new loan, conversion of old loan or L/C, letter of guarantee and bill etc. (no matter such old loan, L/C, letter of guarantee and bill etc. occurs during or prior to the credit extension period) for Party B (or the Authorized Applicant) during the credit extension period, it is confirmed by Party B that, the debts generated therefore shall be included into the scope of guarantee liability.

 

3.4 Where Party B (or the Authorized Applicant) applies for import letter of credit, and the same L/C subsequently witnesses inward documentary bills actually, import letter of credit and inward documentary bills shall occupy the same credit line. In other words, on the occurrence of inward documentary bills, if the limit recovered upon external payment of L/C is used to transact inward documentary bills, it shall be deemed that the same limit of the original import letter of credit is occupied. It’s confirmed by Party B that, the debts generated therefore shall be included into the scope of guarantee liability.

 

4. Independence of the Contract

 

 

5. Pledge Term

 

 

6. Transfer and Delivery of the Pledge

 

6.1 If the pledge hereunder is a movable property, Party B shall transfer the pledge to Party A for occupation on the execution date of this Contract.

 

 

 

6.2 If the pledge hereunder is title, Party B shall deliver the document of title to Party A on the execution date of this Contract, and make corresponding records thereon. Party A shall properly preserve the document of title. Should the document of title suffer loss as a result of improper preservation, Party A shall assume the re-application expense.

 

6.3 Where Party B fails to transfer or deliver the pledge in a timely manner, Party B shall be held responsible for compensation with regard to the losses suffered by Party A therefore.

 

7. Pledge Registration

 

7.1 The pledge hereunder must go through the pledge registration according to law. Otherwise, no pledge may be established. Party B shall coordinate with Party A to perform the pledge registration in corresponding registration management authority by holding this Contract and relevant materials within the time period required by Party A.

 

7.2 Party B shall actively cooperate with Party A to transact relevant formalities as per the preceding paragraph on the principle of honesty and credibility. In case of any change of registered information such as legal person and corporate name, or upon occurrence of dissenting registration, Party B shall timely notify Party A. Where the timely transaction of relevant formalities fails for reasons attributed to Party B, or the registration becomes invalid for the failure of notifying alteration in registered information, Party B shall assume the compensation liability for losses suffered by Party A therefore.

 

7.3 Where company shares are deemed as the pledge hereunder, in case of any allotment of shares (namely, allotment of shares to original shareholders) or additional issuance during the pledge period, Party B shall perform the purchase obligation in full amount, and apply them for pledge together with pledged shares, instead of waiving the right of allotment of shares or additional issuance.

 

 

8. Preservation of Pledge and Fruits

 

8.1 Party A is obliged to preserve the pledge hereunder in a proper manner. Should the pledge suffer losses or damages as a result of improper preservation, Party A shall assume the civil liability.

 

8.2 Where Party A fails to properly preserve the pledge hereunder, which may cause the loss or damages to the pledge thereof, Party B shall be entitled to ask Party A to draw the pledge, or require the prepayment of debts for the purpose of pledge return.

 

8.3 Party A shall be entitled to collect the fruits generated from the pledge, which shall be initially applied to offset the expense on fruits collection. Party A shall enjoy the pledge for the residual fruits.

 

9. Insurance

 

9.1 Party B is obliged to take Party A as the first beneficiary, to transact sufficient property insurance for the pledge, and to deliver the policy to Party A for preservation. In principle, the insured term shall be longer than the credit extension period stipulated by the Credit Extension Agreement. Where the credit extension period is prolonged or the credit debt fails to be repaid upon expiration, Party B must go through the formality for the purpose of prolonging the insured term. If the insured property suffers any losses, Party A shall be entitled to preferentially take back the principal and interests and other relevant fees under the Credit Extension Agreement from the insurance compensation, or deposit the insurance compensation into the account of cash guarantee deposit, or negotiate with Party B to transact the withdrawal formalities of insurance compensation, so as to collect corresponding amounts / pay payables upon expiration of loans, discounted or accepted drafts, L/C produced and letter of guarantee under the Credit Extension Agreement.

 

9.2 Where Party B fails to purchase insurance for the pledge or fails to prolong the insured term as required, Party A shall be entitled to directly purchase insurance or extend the insured term on behalf of Party B and have relevant expenses undertaken by Party B, in which circumstance Party A can conduct direct deduction from any account of Party B.

 

9.3 Where Party B (or the Authorized Applicant) fails to repay all the debts under the Credit Extension Agreement upon expiration of the insured term, Party B must go through the renewal formality for the insured term of the pledge. Otherwise, Party A shall be entitled to transact the formality on behalf of Party B and have relevant expenses undertaken by Party B, in which circumstance Party A can conduct direct deduction from any account of Party B.

10. Assumption of Relevant Expenses

 

 

11. Disposition of the Pledge

 

11.1 If the pledge suffers damages or has its value substantially declined during the validity hereof, which is likely to endanger the rights of Party A, Party A shall be entitled to ask Party B to provide corresponding guarantee; if Party B refuses to provide guarantee, Party A may conduct auctions or sales of the pledge, apply the proceeds obtained from auctions or sales thereof to repay the loan, advance money, principal and interests of other creditor’s rights etc. under the Credit Extension Agreement in advance, or carry out drawing from the third party stipulated with Party B.

 

11.2 Party A shall be entitled to dispose the pledge according to law if:

 

11.2.1 Party B (or the Authorized Applicant) commits any event of default stipulated by the Credit Extension Agreement, or any specific business agreement;

 

11.2.2 Party B or other pledgors/mortgagors/guarantors commit any event of default stipulated by the Credit Extension Agreement, or Party B fails to perform its obligations hereunder;

 

11.2.3 Party B, while being a natural person, has neither successor nor donee on death, or the successor and donee of Party B waives inheritance or legacy and refuses to perform the obligations hereunder;

 

11.2.4 Party B, while being a legal person or other entity, suffers termination of business, withdrawal or cancellation of business license, and applies for or is applied for bankruptcy and dissolution;

 

11.2.5 The materials concerning tax rebate amount and its transfer into account provided by Party B to Party A is proved to be falsified or forged;

 

11.2.6 There are other events threatening the realization of creditor’s rights under the Credit Extension Agreement.

 

11.3 Where Party B conceals the co-ownership and disputes of the pledge, or Party B enjoys neither ownership nor disposition of the pledge, Party A shall be entitled to ask Party B to provide new guarantee after becoming aware thereof. If Party B fails to provide new guarantee as required by Party A, Party B shall assume the liquidated damages at  % of the Credit Line under the Credit Extension Agreement. Should Party A suffer any economic losses therefore, Party B shall be held responsible for compensating all the economic losses of Party A. Under this circumstance, Party A shall be entitled to instantly exercise the right of recourse against Party B or the Authorized Applicant.

 

11.4 Where the pledge suffers declining market value/value/damage, or has the pledge rate no longer satisfying Party A’s requirements or touching the early warning line (early warning line: see 16.8 ) as a result of market changes or fluctuation of exchange rate; or the pledge is equity of the Authorized Applicant held by Party B and the equity shares subject to pledge more than 50% (including 50%) of the total shares of the Authorized Applicant; or the equity transaction price is lower than the net assets value per share, Party B shall provide cash deposit as required by Party A, or increase/replace with new guarantee, so as to remedy the gap arising from the declining market value of the pledge. Otherwise, it shall be deemed that, Party B commits the event of default under the Credit Extension Agreement, and Party A may take corresponding remedies for its breach.

12. Where the pledge hereunder is a document of title (including but not limited to bill, bond, warehouse receipt, deposit receipt and bill of lading) or any financing product, if the expiry date of the said document of title or the said financing product is earlier than the expiry date of each specific business under the Credit Extension Agreement, on the expiration of the said document of title or the said financing product, Party A shall conduct redemption or realization and apply the proceeds obtained therefore to repay the debts attributed to Party B (or the Authorized Applicant) under the Credit Extension Agreement in advance (under this circumstance, relevant debts shall due in advance), or directly deposit relevant amounts into the account of cash deposit opened by Party B in the side of Party A to be the pledge guarantee for the debts owed by Party B (or the Authorized Applicant) under the Credit Extension Agreement, or negotiate with Party B for the pick-up of the goods under the said document of title and transact drawing, which Party B has no objection to. Furthermore, Party B shall coordinate with Party A to transact relevant formalities as required.

 

 

 

 

13. Special Provisions on the Pledge of Export Tax Rebate Account

 

 

 

 

 

 

 

14. Special Provisions on the Pledge of Receivables

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

16. Miscellaneous

 

16.1 It is confirmed by Party B that, any operation of Party A for transacting specific business for Party B (or the Authorized Applicant) and any operation concerning this Contract performed by Party A may be processed by any branch within the jurisdiction of Party A, and have the said branch generating, issuing or producing relevant letters. The business operation of branches within the jurisdiction of Party A and letters produced thereby shall be deemed as the act of Party A and have binding effect on the Parties.

 

16.2 If Party B experiences division and merger (acquisition) etc. during the validity hereof, the institution(s) upon change shall assume or respectively assume the obligations hereunder. If Party B is declared as suffering dissolution or bankruptcy, Party A shall be entitled to dispose the pledged property in advance.

 

16.3 If Party A grants any tolerance or grace to any breach or delay committed by Party B (or the Authorized Applicant) during the validity hereof, or postpones its exercise of due rights and interests under the Credit Extension Agreement, it shall not damage, influence or restrict any rights and interests enjoyed by Party A as the creditor in accordance with relevant legal provisions and this Contract, and cannot be deemed that Party A waives the rights of taking remedies for breach either at present or in the future.

 

16.4 Upon effectiveness of this Contract, neither Party may alter or terminate this Contract at its own discretions, unless it is agreed upon by the opposite Party. In case of any necessity for altering or terminating this Contract, the Parties shall reach negotiated consensus, and execute a written agreement. Prior to the conclusion of such agreement, clauses of this Contract shall still remain valid.

 

16.5 All notices, requirements or other documents concerning this Contract between Party A and Party B shall be given upon in written form (including but not limited to letter, fax, email, e-bank of Party A, short message of mobile phone or WeChat).

 

 

 

 

16.5.1 As to the personal delivery (including but not limited to delivery by attorney/notary, and express mail), it shall be deemed to have been properly given after the recipient signs for (in case of any refusal by the recipient, it shall be deemed to have been properly given on the refusal date / return date or seven (7) days upon the delivery date (whichever is earlier)); as to the delivery by mail, it shall be deemed to have been properly given at seven (7) days after the delivery; as to the delivery by fax, email, e-bank notice of Party A, short message of mobile phone or WeChat, the date when successful delivery has been displayed by the corresponding system of the sender shall be deemed as the date of arrival.

 

 

16.5.2 The aforesaid contact address, email, fax number, mobile phone number and WeChat number shall simultaneously serve as the address for service of the Parties’ notary documents and judicial documents (including but not limited to indictment / application form for arbitration, evidence, summons, notice of respondence to action, notice of burden of adducing evidence, notice of court session, notice about hearing, judgment/award, order, mediation decision, notice of performance within time limit and other legal documents at the hearing and implementation stage). Where any appellate court or notary authority sends the aforesaid documents to the address for service in writing as stipulated, it shall be deemed as given upon (the specific delivery criteria shall refer to the foregoing clause 16.5.1.).

 

16.6 Unless it is otherwise stipulated in an explicit manner, all terms mentioned hereunder shall enjoy the same meaning in the Credit Extension Agreement.

 

16.7 If the credit debt is other than in RMB, Party A shall be entitled to directly apply the proceeds obtained hereunder for foreign exchange purchasing in accordance with the exchange rate published by Party A on repayment, so as to clear the credit debt. The amount of the debt other than in RMB under the Master Contract shall be calculated in accordance with the exchange rate (buying rate) published by Party A on repayment.

 

16.8 It is committed by Party B that, during the validity hereof, the principal of the pledge provided by Party B shall cover the loan principal and interest under the Credit Extension Agreement; if they are in different currencies, the pledge rate shall be controlled within 93% (namely, the principal of pledge no less than the amount of loan principal and interest * business exchange rate / 0.93); if the pledge rate is over (including) 95% as a result of exchange rate fluctuation, Party B shall timely supplement the pledge as required by Party A to control the pledge rate within 93%; if the pledge rate is up to 98%, subject to the demand of Party A, Party B shall take more effective means to supplement the pledge for the purpose of controlling the pledge rate within 93%.

 

17. Transfer of Creditor’s Rights and Pledge

 

17.1 No matter the creditor’s rights of the maximum pledge guarantee are confirmed, if Party A transfers the creditor’s rights under the Credit Extension Agreement to a third party in whole, the maximum pledge shall be transferred to the assignee of creditor’s rights as well.

 

17.2 If Party A transfers the creditor’s rights in partial upon confirmation of the creditor’s rights of the pledge hereunder, the said part of pledge shall be transferred as well. Then, Party A shall apply the creditor’s rights not transferred to enjoy the pledge together with the assignee of transferred creditor’s rights according to the proportion of the amount of creditor’s rights. If Party A transfers the creditor’s rights in partial prior to the confirmation of the creditor’s rights for pledge guarantee hereunder, the said part of pledge shall be transferred as well. Correspondingly, the maximum amount of Party A’s principal creditor’s rights guaranteed by the original maximum pledge shall decline (namely, deduction of the amount of the transferred creditor’s rights from the maximum amount of Party A’s principal creditor’s rights guaranteed by the original maximum pledge). Upon confirmation of the principal creditor’s rights of Party A not transferred, Party A shall apply the creditor’s rights not transferred to enjoy the pledge together with the assignee of transferred creditor’s rights according to the proportion of the amount of creditor’s rights.

18. Applicable Law and Dispute Resolution

 

18.1 The conclusion and interpretation of this Contract as well as the dispute resolution shall be governed by the laws of the People’s Republic of China (excluding laws in Hong Kong, Macao and Taiwan).

 

18.2 Any dispute arising from the performance of this Contract shall be settled by the Parties in accordance with the ways stipulated under the Credit Extension Agreement.

 

19. Effectiveness of the Pledge Contract

 

 

20. Supplementary Articles