Restrictions on Equity Transfer Clause Samples
Restrictions on Equity Transfer. (1) Under no circumstances shall Party A directly or indirectly transfer any corporate equity to an entity (“competitor”) or its affiliated party that maintains a competitive relationship with the business of the Target Company unless it acquires the written consent of the Target Company ahead of time.
(2) Within one year after the eligible listing of the Target Company (or longer period provided by applicable laws and regulations), Party A shall not transfer or entrust others to manage the shares of the Target Company held by it in any form, nor propose that the Target Company repurchase the shares of the Target Company held by it. Upon expiration of the aforesaid time limit, the shares of the Target Company held by Party A can be traded in the relevant market, except for those prohibited from being sold in accordance with the mandatory provisions of applicable laws, and the transaction shall strictly follow laws, administrative regulations, departmental rules, normative documents and relevant regulations of regulatory authorities such as exchanges, and corresponding information disclosure obligations shall be fulfilled.
Restrictions on Equity Transfer. (a) As of December 31, 2022 or until other date agreed in writing between the Original Shareholder and the New Shareholder (referred to as the “Long Stop Date” in this Article 5.1), without prior written consent of the New Shareholder, the Original Shareholder may not transfer or dispose of the equity in the Target Company held by it in any way, including but not limited to direct or indirect transfer of any part of the equity in the Target Company held by it, or creation of any pledge or Encumbrance over such equity. Any equity transfer in breach of this Article shall be invalid, and the transferee shall not enjoy the rights as shareholder of the Company, nor be deemed as a Shareholder by the Target Company.
(b) For the avoidance of doubt, before the Long Stop Date, the provisions of Article 5.1(a) shall not be restricted by Article 71 of the Company Law, that is, where the Original Shareholder proposes to transfer the equity in the Target Company held by it and notifies the New Shareholder in writing to seek consent for its equity transfer, but the New Shareholder fails to reply within 30 days upon receipt of such written notice, it shall not be deemed that the New Shareholder has consented to such transfer; and if the New Shareholder does not consent to the transfer, it has no obligation to purchase such equity proposed to transfer, and the refusal of the New Shareholder to purchase such equity proposed to transfer shall not be deemed as its consent to such transfer. The Original Shareholder agrees that it shall not invoke the provision of Article 71 of the Company Law to defend against the right of the New Shareholder under this Article. Provisions of Article 5.1 (a) shall not apply after the Long Stop Date.
Restrictions on Equity Transfer. (a) Without the prior written consent of the Investors, the Existing Shareholders shall not transfer or dispose of their equity interest in the Company in any manner, including but not limited to direct or indirect transfer of any part of the equity interest they hold in the Company, or creation of pledge on such equity interest.
(b) Unless there are prohibitory or restrictive provisions under the Laws and Regulations or otherwise provided elsewhere hereunder, the disposal by the Investors of their equity interest in the Company shall not be subject to any restrictions provided, however, that the Existing Shareholders shall be entitled to exercise their statutory right of first refusal pursuant to the Company Law.
(c) Notwithstanding the foregoing, no shareholder shall directly or indirectly transfer the equity interest it holds in the Company to any competitor of the Company. A list of the existing competitors of the Company is attached hereto as Schedule I; any addition of new competitors or adjustments by the Company to such list may be made only upon proposal by the Company or its directors and a unanimous consent of the directors at a Board meeting.