Exhibit 10.12
LOAN AGREEMENT
The Loan Agreement (the "Agreement") is entered into as of May 27, 2004
between the following two parties:
(1) CHINA FINANCE ONLINE CO. LTD. (the "Lender"), a limited liability
company established and registered in Hong Kong, SAR.
REGISTERED ADDRESS: Unit C, 8/F, East Wing, Sincere Insurance
Xxxxxxxx 0-0, Xxxxxxxx Xxxx, Xxxx Xxxx, SAR.
(2) XXXX XX (the "Borrower")
PRC ID NUMBER: 110108491204891
ADDRESS: Rm 616,Tower A, COFCO Plaza, 8 Jianguomennei Dajie,
Beijing, 100005 P.R.China
Lender and Borrower will each be referred to as a "Party" and
collectively referred to as the "Parties."
WHEREAS, Borrower holds 55% of the equity of Fuhua Innovation
Technology Development Co., Ltd. ("Fuhua"), a limited liability company
established and registered in the People's Republic of China (the "PRC").
WHEREAS, Borrower wishes to borrow a loan from Lender to finance its
investment in Fuhua and Lender agrees to provide such loan to Borrower.
NOW THEREFORE, the Parties agree as follows:
1. LOAN
1.1 Lender agrees to provide a loan to Borrower with the principal amount
equal to the US Dollar equivalent of RMB 1,650,000 in accordance with
the terms and conditions set forth herein (the "Loan"). Term for such
loan shall be ten (10) years which may be extended upon the agreement
of the Parties (the "Term"). Notwithstanding the foregoing, in the
following circumstances, Borrower shall repay the Loan regardless if
the Term has expired:
(1) Borrower deceases or becomes a person without legal capacity or
with limited legal capacity;
(2) Borrower commits a crime or is involved in a criminal act; or
(3) Lender or its designated assignee can legally purchase Borrower's
interest in Fuhua under the PRC law and Lender chooses to do so.
1.2 Lender shall remit the amount of the Loan to an account designated by
Borrower within seven (7) days after receiving Borrower's disbursement
notice in writing, provided that all of the conditions precedent to
disbursement set forth in Section 2 of
this Agreement have been fully satisfied. Borrower shall deliver a
written confirmation to Lender within one (1) day after receiving the
amount of the Loan.
1.3 The Loan shall only be used by Borrower to invest in Fuhua's registered
capital. Without Lender's prior written consent, Borrower shall not use
the Loan for any other purpose or transfer or pledge his interest in
Fuhua to any third party.
1.4 Borrower can only repay the Loan by transferring all of his interest in
Fuhua to Lender or a third party designated by Lender when such
transfer is permitted under the PRC law.
1.5 In the event Borrower transfers his interest to any third party other
than Lender, Borrower shall pay the full amount of the proceeds it
receives from such transfer to Lender regardless if the amount of such
proceeds exceeds the amount of the Loan.
1.6 Lender and Borrower hereby jointly agree and confirm that Lender has
the right to, but has no obligation to, purchase or designate a third
party (legal person or natural person) to purchase all or part of
Borrower's interest in Fuhua at a price equal to the amount of the Loan
when such purchase is allowed under the PRC law. If Lender or the third
party assignee designated by Lender only purchases part of Borrower's
interest in Fuhua, the purchase price shall be reduced on a pro rata
basis.
1.7 In the event when Borrower transfers his interest in Fuhua to Lender or
a third party transferee designated by Lender, (i) if the actual
transfer price paid by Lender or the third party transferee equals or
is less than the principal amount of the Loan, the Loan shall be deemed
as interest free; or (ii) if the actual transfer price paid by Lender
or the third party transferee is higher than the principal amount of
the Loan, the amount exceeding the principal amount of the Loan shall
be deemed as an interest accrued on the Loan and paid by Borrower to
Lender in full.
2. CONDITIONS PRECEDENT TO DISBURSEMENT
The following conditions must be satisfied before the Loan is disbursed
to Borrower:
2.1 Subject to the terms of Section 1.2, Lender has received the written
disbursement notice from Borrower.
2.2 Borrower and Lender's wholly owned subsidiary, China Finance Online
(Beijing) Co., Ltd. ("CFO (Beijing)"), have formally executed a equity
pledge agreement (the "Equity Pledge Agreement"), under which Borrower
agrees to pledge all his interest in Fuhua to CFO (Beijing).
2.3 Borrower, CFO (Beijing) and Fuhua have executed a purchase option and
cooperation agreement (the "Purchase Option Agreement"), according to
which Borrower grants CFO (Beijing) an irrevocable option to purchase
all of his interest in Fuhua when certain conditions provided in the
agreement are met.
2.4 The Equity Pledge Agreement and Purchase Option Agreement remain valid
and effective. None of the parties under such agreements have
materially breached any terms or conditions thereof and all of the
necessary approvals, consents,
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authorizations and registrations required under such agreements have
been obtained or completed.
2.5 The representation and warranties under Section 3 remain true and
correct on the day when the disbursement notice is delivered to Lender
and on the date the Loan is disbursed to Borrower as if such
representations and warranties are made as of such dates.
2.6 Borrower has not materially breached any terms or conditions hereof.
3. REPRESENTATIONS AND WARRANTIES
3.1 Lender hereby represents and warrants to Borrower that:
(a) Lender is a company registered and validly existing under the laws
of Hong Kong, SAR;
(b) subject to its Memorandum and Articles of Association and other
organizational documents, Lender has full right, power and all
necessary approvals and authorizations to execute and perform this
Agreement;
(c) the execution and the performance of this Agreement will not
contravene any provision of law applicable to Lender or any
contractual restriction binding on or affecting it; and
(d) this Agreement shall constitute the legal, valid and binding
obligations of Lender, which is enforceable against Lender in
accordance with its terms upon its execution.
3.2 Borrower hereby represents and warrants to Lender that:
(a) Fuhua is a limited liability company registered and validly
existing under the laws of PRC and Borrower owns 55% of Fuhua's
equity;
(b) Borrower has full right, power and all necessary and appropriate
approval and authorization to execute and perform this Agreement;
(c) the execution and the performance of this Agreement will not
contravene any provision of law applicable to Borrower or any
contractual restriction binding on or affecting Borrower;
(d) this Agreement shall constitute the legal and valid obligations of
Borrower, which is enforceable against Borrower in accordance with
its terms upon its execution; and
(e) there are no legal or other proceedings before any court, tribunal
or other regulatory authority pending or threatened against
Borrower.
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4. NOTIFICATIONS
Notice or other communications under this Agreement shall be delivered
personally or sent by facsimile transmission or by registered mail to
the address set forth below, except that such address has been changed
in writing. The date noted on the return receipt of the registered mail
is the service date of the notice if the notice is sent by registered
mail; the sending date is the service date of the notice if the notice
is sent personally or by facsimile transmission. The original of the
notice shall be sent personally or by registered mail to the following
address after the notice is sent by facsimile.
Lender: China Finance Online Co. Ltd.
Address: Unit C, 8/F, East Wing
Sincere Insurance Xxxxxxxx 0-0
Xxxxxxxx Xxxx, Xxxx Xxxx, SAR.
Borrower: Xxxx Xx
Address: Rm 616,Tower A, COFCO Plaza,
8 Jianguomennei Dajie,
Beijing, 100005 P.R.China
5. CONFIDENTIALITY
The Parties acknowledge and confirm that any oral or written materials
concerning this Agreement exchanged between them are confidential
information. The Parties shall protect and maintain the confidentiality
of all such confidential data and information and shall not disclose to
any third party without the other party's written consent, except (a)
the data or information that was in the public domain or later becomes
published or generally known to the public, provided that it is not
released by the receiving party, (b) the data or information that shall
be disclosed pursuant to applicable laws or regulations, and (c) the
data or information that shall be disclosed to One Party's legal
counsel or financial counsel who shall also bear the obligation of
maintaining the confidentiality similar to the obligations hereof. The
undue disclosing of the confidential data or information of One Party's
legal counsel or financial counsel shall be deemed the undue disclosing
of such party who shall take on the liability of breach of this
Agreement.
6. GOVERNING LAW AND SETTLEMENT OF DISPUTES
6.1 The execution, validity, interpretation, performance, implementation,
termination and settlement of disputes of this Agreement shall be
governed by the laws of Hong Kong, SAR.
6.2 In event of any dispute arising from or in connection with this
Agreement, the Parties shall attempt to resolve the dispute through
friendly consultations. In the event that satisfactory resolution is
not reached within thirty (30) days after commencement of such
consultation, the dispute shall be submitted (which submission may be
made by either Borrower or Lender) to resolution by arbitration
administered by Hong Kong
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International Arbitration Center (the "Center") in Beijing, China, in
accordance with the procedural rules of the Center, which are in effect
at the time the application for arbitration is made. The arbitral award
shall be final and binding upon all parties hereto.
7. MISCELLANEOUS
7.1 This Agreement is executed in both Chinese and English. In case of any
inconsistency between the two versions, the Chinese version shall
prevail.
7.2 This Agreement can only be amended by written agreements jointly
executed by the parties.
7.3 Any provision of this Agreement that is invalid or unenforceable shall
not affect the validity and enforceability of any other provisions
hereof.
IN WITNESS WHEREOF, the Parties have duly executed this Agreement, or have
caused this Agreement to be duly executed on their behalf, as of the date first
hereinabove set forth.
LENDER:
CHINA FINANCE ONLINE CO. LTD
/s/ Zhongshan Qian
____________________________
By:
Title: CFO
BORROWER:
XXXX XX
/s/ Xxxx Xx
____________________________
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