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Commercial Pledge Agreement Template for Hong Kong

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Key Requirements PROMPT example:

Commercial Pledge Agreement

"I need a Commercial Pledge Agreement under Hong Kong law for pledging 10,000 shares in ABC Trading Limited as security for a HKD 5 million loan facility, with the agreement to be effective from March 1, 2025."

Document background
The Commercial Pledge Agreement is a crucial security document used in Hong Kong's commercial and financial sectors to create security interests over movable assets. It is commonly used in financing transactions where a lender requires security over specific assets such as shares, bank accounts, receivables, or other tangible or intangible property. The agreement must comply with Hong Kong's security creation and registration requirements, particularly under the Companies Ordinance if the pledgor is a company. The document typically includes detailed provisions on the pledge mechanics, representations and warranties, covenants, enforcement rights, and standard boilerplate clauses. This type of agreement is essential for protecting the interests of financial institutions and other commercial parties in secured lending transactions within Hong Kong's jurisdiction.
Suggested Sections

1. Parties: Identification of the Pledgor and Pledgee, including their full legal names, registration numbers (if companies), and registered addresses

2. Background: Context of the pledge agreement, including reference to any underlying facility or commercial arrangement being secured

3. Definitions and Interpretation: Definitions of key terms used in the agreement and rules of interpretation

4. Creation of Pledge: Express provisions creating the pledge and describing the pledged assets

5. Secured Obligations: Definition and scope of the obligations being secured by the pledge

6. Perfection and Registration: Requirements for perfecting the pledge and any necessary registration requirements

7. Representations and Warranties: Pledgor's representations regarding ownership, authority, and status of pledged assets

8. Covenants: Ongoing obligations of the Pledgor regarding the pledged assets

9. Rights and Obligations: Specific rights and obligations of both parties during the pledge period

10. Enforcement: Circumstances and procedures for enforcement of the pledge

11. Power of Attorney: Appointment of Pledgee as attorney for specific enforcement purposes

12. General Provisions: Standard contractual provisions including notices, amendments, governing law, etc.

Optional Sections

1. Income and Distributions: Provisions dealing with dividends, interest, or other income from pledged assets - include when pledged assets generate income

2. Custody Arrangements: Provisions regarding custody of pledged assets - include when assets are held by a third-party custodian

3. Further Advances: Provisions for securing future advances - include when contemplating additional secured obligations

4. Insurance: Requirements for insurance of pledged assets - include when assets are physical property

5. Tax Provisions: Allocation of tax obligations - include when pledge may have tax implications

6. Multiple Pledgors: Joint and several liability provisions - include when there is more than one pledgor

7. Currency Provisions: Currency conversion and payment provisions - include for cross-border transactions

Suggested Schedules

1. Schedule 1 - Description of Pledged Assets: Detailed description and/or list of all assets subject to the pledge

2. Schedule 2 - Secured Obligations: Detailed description of the secured obligations, including reference to facility agreements if applicable

3. Schedule 3 - Form of Notice of Pledge: Template notice to be sent to relevant third parties regarding the pledge

4. Schedule 4 - Perfection Requirements: Specific actions required to perfect the pledge in relevant jurisdictions

5. Schedule 5 - Forms of Transfer Documents: Template documents for transferring pledged assets upon enforcement

6. Appendix A - Required Authorizations: List of required corporate and regulatory authorizations

7. Appendix B - Registration Requirements: Detailed registration requirements and procedures

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions

















































Clauses































Relevant Industries

Banking

Financial Services

Asset Management

Securities Trading

Manufacturing

Trading

Import/Export

Logistics

Real Estate

Technology

Retail

Wholesale

Commodities

Relevant Teams

Legal

Finance

Treasury

Risk Management

Compliance

Corporate Secretarial

Credit

Commercial

Security & Collateral Management

Portfolio Management

Relevant Roles

Legal Counsel

Corporate Lawyer

Finance Manager

Treasury Manager

Credit Risk Manager

Security Trustee

Relationship Manager

Compliance Officer

Company Secretary

Chief Financial Officer

Commercial Director

Risk Manager

Transaction Manager

Portfolio Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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