S.L. 386.5 Art. 7AShares subject to pledge.

(1) Where shares in a foreign company which is to be continued in Malta in terms of these regulations are subject to a pledge, charge, assignment by way of security or other similar security, hereinafter referred to as ''pledge'', in the country or jurisdiction where the foreign company was formed and incorporated or registered, such pledge shall continue to be valid and effective under the laws of Malta, and following the registration of the company as continued in Malta shall be fully enforceable as a pledge of shares in terms of article 122 of the Act subject to the following conditions:

(a) that the pledge has been validly created in writing as a right of security and preference over shares under the laws of the country or jurisdiction where the foreign company was formed and incorporated or registered;

(b) that the pledge is valid and effective as of the date of issue of the provisional certificate of registration in Malta;

(c) that a notice of pledge be delivered to the Registrar for registration in terms of article 122(2) of the Act within fourteen days of the date of issue of the provisional certificate of registration in Malta.

(2) A pledge of shares as mentioned in subregulation (1) -

(a) shall continue to be regulated by the law chosen by the parties and such law shall apply to all the rights, including rights of enforcement thereof, and obligations of the parties thereto, except to the extent the pledge is enforced in Malta in which case the relevant provisions of article 122 of the Act shall apply;

(b) shall continue to be subject to any submission made by the parties to the jurisdiction of any foreign court or arbitration which submission shall be valid and effective and shall remain fully in force.

(3) The party delivering the notice of pledge to the Registrar in Malta in terms of this regulation shall also notify the other party to the pledge agreement by serving him with a true copy of the said notice within fourteen days of notification to the Registrar.

(4) On termination of the pledge, a notice of termination of the pledge shall be delivered to the Registrar for registration in accordance with the provisions of article 122(15) of the Act.