From the nature of rights and interests, this contract represents equity (the rights and interests invested in the fund). Legally, it can be pledged (equity pledge, real estate mortgage).
However, from the practical point of view, it depends on the enterprise type of this private equity fund, whether it is a limited company or a partnership, and whether investors are reflected in the industrial and commercial registration, which is to solve the registration problem of equity pledge. If you can register, there is no problem in legal procedure.
Finally, it depends on whether the lender accepts this pledge. This mainly depends on the lender's assessment of the future liquidity of this kind of equity. If it is easy to realize, the lender will accept it.
Second, can private equity funds mortgage loans?
Legal analysis: Private equity funds can not be used as collateral for mortgage, but can be used as the subject matter of pledge.
Legal basis: Civil Code of People's Republic of China (PRC).
Article 394 Where the debtor or a third party mortgages the property to the creditor to guarantee the performance of the debt without transferring the property, and the debtor fails to perform the due debt or realize the mortgage right according to the agreement of the parties, the creditor has the right to be paid in priority for the property. The debtor or the third party specified in the preceding paragraph is the mortgagor, the creditor is the mortgagee, and the property that provides guarantee is the mortgaged property.
Article 395 The following properties that the debtor or a third party has the right to dispose of may be mortgaged: (1) Buildings and other land attachments; (2) The right to use construction land; (3) the right to use the sea area; (4) Production equipment, raw materials, semi-finished products and products; (5) Buildings, ships and aircraft under construction; (6) means of transportation; (seven) other property not prohibited by laws and administrative regulations. The mortgagor may mortgage the property listed in the preceding paragraph together.
Article 400 To establish a mortgage, the parties shall conclude a mortgage contract in writing. A mortgage contract generally includes the following clauses: (1) the type and amount of secured creditor's rights; (2) The time limit for the debtor to perform the debt; (3) The name and quantity of the mortgaged property; (4) the scope of the guarantee.
Article 419 During the limitation of action for principal creditor's rights, the mortgagee shall exercise the right of mortgage. If it is not exercised, people will not be protected.
Third, can private equity funds mortgage loans?
Legal analysis: Private equity funds can not be used as collateral for mortgage, but can be used as the subject matter of pledge.
Legal basis: Civil Code of People's Republic of China (PRC).
Article 394 Where the property is mortgaged to the creditor to guarantee the possession of the debt, the creditor has the right to use himself or a third party as the mortgagor and the creditor as the mortgagee under the circumstances agreed by the parties.
Article 395 The following property that the debtor or a third party has the right to dispose of may be sealed up: (2) the right to use construction land; (3) the right to use the sea area; (4) production and products; (5) Buildings, ships and aircraft under construction; (6) means of transportation; (7) Law and administration. The mortgagor may mortgage the property listed in the preceding paragraph together.
Article 400 To establish a mortgage, the parties shall conclude a mortgage contract in writing. A mortgage contract generally includes the following clauses: (1) the type and amount of secured creditor's rights; (2) The time limit for the debtor to perform the debt; (3) Name and quantity of the collateral.
Article 419 During the limitation of action for principal creditor's rights, the mortgagee shall exercise the right of mortgage. If it is not exercised, people will not be protected.