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Share Pledge Agreement template
Share Pledge Agreement sample


What is Share Pledge Agreement?

Share Pledge Agreement Secures a loan with company shares, specifying the number and type of shares pledged as collateral, conditions for release, and default consequences.



Sample template:



SHARE PLEDGE AGREEMENT


This Share Pledge Agreement (the "Agreement") is made and entered into as of the __ day of _______, 20__ (the "Effective Date") by and between Jessica R. Evans, an individual residing at __________________________ ("Pledgor"), and [LENDER NAME], an individual residing at _____________________________ (the "Lender").

1. Pledge of Shares and Grant of Security Interest

1.1. Pledge


Pledgor hereby pledges, transfers, and assigns to Lender 10,000 common shares, representing approximately 5% of the total outstanding common shares of Innovative Tech Solutions, Inc., a corporation organized under the laws of the State of [STATE] (the "Company") and registered with the Securities and Exchange Commission (the "Pledged Shares"), as security for the prompt and complete payment and performance of all obligations of Pledgor under a certain loan agreement (the "Loan Agreement") entered into between Pledgor and Lender, and all extensions, renewals, and modifications thereof. The Pledged Shares shall constitute collateral (the "Collateral") securing the repayment of the loan made by Lender to Pledgor pursuant to the Loan Agreement (the "Loan").



2. Delivery of Pledged Shares

Pledgor shall promptly deliver to Lender the original stock certificates representing the Pledged Shares, endorsed in blank or accompanied by duly executed stock powers, and any other necessary instruments of transfer, all in form and substance satisfactory to Lender.



3. Representations and Warranties

3.1. Title and Authority


Pledgor represents and warrants that Pledgor has good and marketable title to the Pledged Shares, free and clear of any lien, security interest, or encumbrance, and that Pledgor has the right and authority to grant the security interest contemplated herein. Pledgor further represents and warrants that the Pledged Shares are fully paid and non-assessable and do not violate any applicable laws, regulations, or agreements to which Pledgor is a party or by which Pledgor is bound.



3.2. No Consents Required


Pledgor represents and warrants that the execution, delivery, and performance of this Agreement do not require the consent or approval of any person, including without limitation the Company, and do not violate any law, regulation, or order applicable to Pledgor or Pledgor's assets.



4. Covenants

4.1. Protection of Security Interest


Pledgor shall take all necessary steps to maintain the validity, priority, and perfection of the security interest granted pursuant to this Agreement, including but not limited to the execution and filing of any financing statements or amendments as may be reasonably requested by Lender.



4.2. Further Assurances


Pledgor shall execute and deliver such additional instruments, documents, and agreements and take such other actions as Lender may reasonably request in order to perfect, protect, or enforce the security interest created by this Agreement or give better evidence of the truth of the representations and warranties contained herein.



5. Rights and Remedies

5.1. Rights upon Default


If Pledgor defaults on any of the obligations secured by this Agreement (a "Default"), Lender may exercise any or all rights and remedies available to a secured party under applicable law, including but not limited to the sale, transfer, or otherwise disposal of the Collateral in accordance with the Uniform Commercial Code as adopted in the State of [STATE]. Lender shall provide Pledgor with written notice of its intent to exercise any such rights or remedies.



5.2. Application of Proceeds


Any proceeds realized by Lender upon exercise of its rights and remedies under this Agreement shall be applied first to the payment of Lender's costs and expenses incurred in connection with the exercise of such rights and remedies, and then to the reduction of the obligations secured by this Agreement, with any surplus to be remitted to Pledgor. In the event the proceeds are insufficient to satisfy the secured obligations, Pledgor shall remain liable for the deficiency.



6. Release of Collateral

Upon the complete satisfaction of the obligations secured by this Agreement, Lender shall promptly release the Collateral and execute and deliver such documents and take such other actions as may be reasonably necessary to evidence or effectuate such release, including but not limited to the termination of any financing statements filed in connection with this Agreement.



7. Governing Law; Entire Agreement

This Agreement shall be governed by and construed in accordance with the laws of the State of [STATE], without regard to its conflicts of law principles. This Agreement constitutes the entire agreement between the parties concerning the subject matter hereof and supersedes all prior or contemporaneous negotiations, representations, or agreements, whether oral or written.



8. Amendments, Waivers, and Consents

This Agreement may be amended, supplemented, or otherwise modified only by a written instrument duly executed by the parties. Any waiver, consent, or approval with respect to any breach or default or any matter or thing contained in this Agreement must be in writing and signed by the party granting such waiver or consent.



9. Notices

All notices, requests, consents, and other communications under this Agreement shall be in writing and shall be deemed duly given when personally delivered, when sent by email with confirmation of transmission, or three days after being deposited in the United States mail, first class, postage prepaid, and addressed to the parties at their respective addresses first set forth above or at such other address as a party may designate by notice to the other party.



IN WITNESS WHEREOF, the parties have executed and delivered this Share Pledge Agreement as of the Effective Date.

____________________________ ________________________________
Jessica R. Evans (Pledgor) [LENDER NAME] (Lender)

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Common Sections of a Share Pledge Agreement


In this Share Pledge Agreement, you will see the following sections:

  1. Pledge of Shares and Grant of Security Interest
  2. Delivery of Pledged Shares
  3. Representations and Warranties
  4. Covenants
  5. Rights and Remedies
  6. Release of Collateral
  7. Governing Law; Entire Agreement
  8. Amendments, Waivers, and Consents
  9. Notices


Summary of each section:

  1. Pledge of Shares and Grant of Security Interest : This section explains that the Pledgor (Jessica) is pledging 10,000 shares of Innovative Tech Solutions, Inc. to the Lender as collateral for a loan. The shares are being used as security to ensure that the loan is repaid.

  2. Delivery of Pledged Shares : This section requires the Pledgor to deliver the original stock certificates representing the pledged shares to the Lender, along with any necessary documents for transferring the shares.

  3. Representations and Warranties : In this section, the Pledgor guarantees that they have the legal right to pledge the shares and that doing so does not violate any laws or agreements. The Pledgor also confirms that no additional consent or approval is needed from anyone else to enter into this agreement.

  4. Covenants : This section outlines the Pledgor's responsibilities to maintain the security interest in the shares and to cooperate with the Lender in perfecting, protecting, or enforcing the security interest.

  5. Rights and Remedies : This section explains the Lender's rights if the Pledgor defaults on the loan, such as selling the pledged shares to recover the loan amount. It also outlines how the proceeds from the sale of the shares will be applied.

  6. Release of Collateral : This section states that once the loan is fully repaid, the Lender must release the pledged shares back to the Pledgor and take any necessary actions to remove the security interest.

  7. Governing Law; Entire Agreement : This section establishes that the agreement is governed by the laws of a specific state and that it represents the entire agreement between the parties, superseding any previous negotiations or agreements.

  8. Amendments, Waivers, and Consents : This section explains that any changes to the agreement must be in writing and signed by both parties, and that any waivers or consents must also be in writing.

  9. Notices : This section outlines how any notices or communications related to the agreement should be sent, such as by email or postal mail.

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