Exhibit 10.12
Note agreement with Kuwait
375
[GRAPHIC OMITTED][GRAPHIC OMITTED]
Commercial Bank of Kuwait
FACILITY(S) CONTRACT
This contract is concluded on 20/08/98 between:
1-The: COMMERCIAL BANK OF KUWAIT
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First Party: The Bank
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Address: X.X XXX 0000, XXXXX 00000, XXXXXX
2-Mr/Messrs: TELESOURCE CNMI INC.
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Second Party: The Customer
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Address: X.X. Xxx 0000, XXXXX 00000, XXXXXX
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Both being fully eligible to agree and enter into contract agreed as follows:
Item 1: Description of Facilities & Limits
The Bank hereby agrees to offer accommodation and banking facilities to the
Customer unto the limit of KB $ 25,000,000.00
$ TWENTY FIVE MILLION ) and an amount of
- for foreign exchange
trading( ________________________ ) on his Account No. 01-11-01670-5
with ________________________________ Branch and
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subject to the conditions stated below:
Types of Facilities
1. LOAN for $25,000,000/ maximum to be used for a period
of_________________________ at 3 % p.a.
IN ADDITION TO 3/6 MONTH LIBOR_______________________________________________
2. for maximum to be used
for a period of_________________________ at
% p.a.
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3. for maximum to be used
for a period of_________________________ at
% p.a.
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4. for maximum to be used
for a period of_________________________ at
% p.a.
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5. for maximum to be used
for a period of_________________________ at
% p.a.
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6. for maximum to be used
for a period of_________________________ at
% p.a.
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7. for maximum to be used
for a period of_________________________ at
% p.a.
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8. for maximum to be used
for a period of_________________________ at
% p.a.
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Item 2 : Purpose of Facilities
The Customer shall use the facilities subject of this Contract for the purpose
provided for i.e. FINANCE CONSTRUCTION OF
POWER GENERATION STATION________________________________________________________
Item 3: Period of Facilities
1. The facilities subject of this contract shall become operative
on / / and
shall fall due for repayment on
/ / without prejudice to the validity of this contract and the
enforceability of all the provisions herein
contained upon the
Customer until the full satisfaction of all his obligations hereunder. 2. The
Bank may renew this contract upon its expiry date for further similar period(s)
unless the Customer notifies the Bank otherwise one month at least prior to the
expiry date. In the event at renewal, this contract shall remain valid and fully
binding upon the Customer until such date when he fulfils all his obligations
hereunder without prejudice to the authorities granted to the Bank under items
(4) and (7) hereof and its right to take the necessary action to obtain its
entire rights. 3.The Bank is entitled at any time to cease or cancel the
accommodation and facilities hereby granted to the Customer and to require the
immediate payment of all outstanding amounts related thereto without indicating
the reasons or giving notice or warning or the Customer having the right to
oppose thereto, in such event, sit the rights at the Bank towards the Customer
shall fall due and become immediately payable without any notice, warning or
judicial judgment or any other legal proceeding, whatsoever. Item 4:Interests 1.
The Bank will charge to the daily balance of any overdrawn account related to
the aforesaid facilities the interest rate hereby specified in accordance with
the Bank's usual practice, in the event that the daily overdrawn balances exceed
the XX xxxx limits agreed on hereunder, the Bank may calculate interest based on
the maximum limit of the contractual interest rate specified by the Central Bank
of Kuwait being on that date % p.s. or the rate to be specified, in future, by
the Central Bank of Kuwait, whichever higher. In respect of the daily overdrawn
foreign currency balances where the Customer exceed the agreed limits, interest
shall be at the rate of % p.a. over the rate stated in item (1) above. Interest
shall be calculated tram the date on which the facility limits were exceeded
until lull settlement without prejudice to the Bank's right to take the
necessary action to recover the excess amount plus accrued interests.
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2. Interests calculated in accordance with the preceding paragraph shall become
payable and charged to the Customer's account quarterly/semi-annually/annually
as per the applicable banking regulations without prejudice to the conditions of
the loan(s) stated in paragraph(2) of item (6) below. 3. It is explicitly agreed
that the Bank shall not pay any Interest to the Customer on the credit balances
of his accounts on which these facilities have been granted. 4. Throughout the
validity of this contract, the Bank shall reserve the right to amend or increase
the agreed Interest rare In respect of the accommodation and facilities subject
of this contract at any time particularly in any of the following events: A. if
the proceeds of foreign exchange trading operations were credited to the
Customers account. B. If any amount owing from the Customer from loan
installments, value of promissory notes. bearer bonds, bills of lading and
others plus accrued interests were, charged to his account. C. lf the amounts
resulting from the Customer's usage of credit and ATM cards were charged to his
account D. If the maximum limit of the contractual interest rates specified by
the Central Bank of Kuwait has been increased. The revised Interest rate becomes
operative from the date specified by the Bank and advised to the Customer, in
any form, including the interest debit advice. 5. The Bank may, in respect of
any amounts which the Customer defaults the timely payment thereof, calculate
delay interest based on the maximum contractual interest rate specified by the
Central Bank of Kuwait on the date of such default or the maximum limit
specified throughout this contract whichever higher. Delay interest for foreign
currencies shall be calculated at % p.a. over the interest rate herein stated.
Calculation of delay interest shall be in the same manner as applicable to the
contractual interest rate stipulated above in accordance with the applicable
banking practice without prejudice to the Bank's right to stop or cancel these
facilities pursuant Item 7 hereof. Item 5: Commissions Without prejudice to the
other items herein stated, the Bank charges a front-end commitment fee
(commitment Interest) at % pa. on the entire amounts of the overdraft facilities
granted hereunder. The Bank shall also charge on the non-cash facilities the
commissions specified in accordance with the banking rules applicable in the
Bank and the Customer acknowledges his full agreement thereto. These commissions
shall be charged In advance upon the utilization and extension of these
facilities from the date of such utilization up to the expiry date.
Item 6: Repayment
1. The Customer undertakes to repay the outstanding debt balance, interests,
commissions and expenses owing from him hereunder on the due date pursuant to
the provisions of this contract without prejudice to the following paragraph of
this item. 2. The Customer shall settle the loan (a) covered by these facilities
amounting to KD $ 25,000,000/ -- ($ TWENTY FIVE MILLION
ONLY____________________________________________________________________________
in the following manner or according to the attached payment schedule which
forms an integral part hereof: In lump sum/by
______________________________installments for KD each
(________________________________________ _____________ The first installment
shall fall due on / / and the last installment for KD ________________ ( ) on /
/ . Interests are payable on a monthly basis or _____________________. 3. The
Bank may claim the Customer for any difference In exchange rates in addition to
expenses, compensations and others incurred as a result of being granted or
utilizing the facilities subject of this contract The Bank may, inrespect of
entering into foreign currency forward sale contracts, also decide at any time
to cancel this type of facility and claim the Customer to pay the difference in
exchange rates in addition to related expenses, compensations and any other
dues. Item 7: Default If the Customer defaults the timely payment of any amount
or the satisfaction of any other obligation hereunder, whatsoever, the Bank may
cease or cancel the accommodation and facilities subject of this contact without
notice or warning or any other action, taking into consideration that all
amounts incurred hereunder and owing from the Customer shall become immediately
payable and the Bank may charge delay interests on the outstanding amounts
pursuant to Item (4) above. Item 8: Acknowledgement of Account Balance The
Customer acknowledges that the balance of his account(s) No. 01-11-01670-5 with
the Bank is in debit/credit for KD $ 3,086.96 ($ THREE THOUSAND EIGHTY SIX &
CENTS 96) on 19 / 08 / 98 plus interest accrued on the said overdrawn balance as
of / / . Item 9: Bank Books & Entries The Customer acknowledges the correctness
of the Bank's books and accounts which he accepts as conclusive evidence of his
obligations hereunder. He may not oppose to their correctness in any manner,
whatsoever, and waives his right to request the auditing of the Bank's books,
accounts and entries under these obligations by force of a court order. Item 10:
Acknowledgement of Account Statements 1. In the event that the Bank had not
received a written objection from the Customer as to the correctness of the
account statement within 15 days from the date such statement has been forwarded
to him by ordinary mail It shall be deemed as an acknowledgement on his part of
the correctness of the details contained In this statement and a final agreement
to ail the entries therein contained. 2. If the Customer had not received the
account statement within 15 days from the date of despatch (quarterly or as
agreed) and had not requested the Bank for same in writing within one week from
that date, he may not oppose against not having received it nor to the entries
therein contained in any manner, whatsoever. Item 11: Non Assignment The
Customer may not assign or waive his obligations hereunder In favor of others
without the Bank's prior approval in writing.
Item 12: Other Conditions & Provisions
1. All types of accounts, whatsoever, opened and existing in the Customers name
& to be opened in his name in future with the Bank or any of Its branches
whether In Kuwait or abroad shall be deemed as securing each other, regardless
of their titles. The Bank may combine or consolidate all or any of these
accounts or apply the credit balance in any of them to set off a debit balance
in another or freeze the credit balance In any of these accounts until the
Customer fulfills all his obligations towards the Bank. The Customer shall
authorize the Bank to effect any set-off debit the credit balance and make any
entries, settlements or transfers in any accounts existing at present or to be
opened in the Customers name with any of the Batik's branches in Kuwait or
abroad. 2. All monies, securities, commercial papers, precious metals, goods and
other rights, whatsoever, registered or deposited at present or to be registered
or deposited in future in the Customers name with the Bank or any of its
branches in Kuwait or abroad are deemed as possessorily mortgaged in favor of
the Bank against all the obligations towards the Bank without the need to
acknowledge same The Bank may recover Its debt directly from the monies
mentioned above by priority set-off and precedence over any other creditor
without any notice, warning or legs proceeding. The Customer undertakes to sign
end execute alt transfers, assignments mortgages, powers of attorney and any
other documents which the Bank may require for perfecting the Bank's title to
any securities subject of this contract. The Customer authorizes the Bank to
sign on his behalf in respect of any action required to finalize these
documents.
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3. The Customer undertakes to provide the Bank within 3 months from the end of
the fiscal year with his annual balance sheet duly examined by an authorized
auditor with his networth declaration on a semi-annual or annual basis as may be
determined by the Bank at its sole discretion together with full reports on his
financial status in the forthcoming stage. He also undertakes to satisfy any
queries made by the Bank it this respect substantiated with evidencing
documents. Item 13: Indulgence The customer acknowledges that any indulgence on
part of the Bank in respect of the limits, terms or due dates of the facilities
hereby granted shall not affect the binding effect of all the conditions and
provisions of this contract upon the customer. Indulgence on part of the Bank
shall not be deemed a waiver of any of its rights nor shall it diminish such
rights. Item 14: Selected Domicile The Customer acknowledges that all
correspondence, account statements, legal and judicial notices forwarded to him
by the Bank to his address stated herein or to the address last known to the
Bank In a registered letter with acknowledgement of receipt are correct and
binding upon him and producing an legal effects. Any change in the Customer's
address becomes effective only from the date of receiving an advice from the
Customer on changing this address. Item 15: Law & Judicial Jurisdiction: This
contract shall be subject to the provisions of the laws applicable in the State
of Kuwait. The Arabic version shall be deemed as the legally binding text in the
event of dispute. The courts of Kuwait City shall have the sole jurisdiction for
any legal disputes arising hereunder.
First Party Second Party TELESOURCE CNMI INC.
Name: X.X. XXXXXXXX Signature:/s/ K. J. Semikian______
Name:____________________ Signature:___________________
Name:____________________ Signature: __________________
Name:____________________ Signature:___________________
Loan Installment Repayment Schedule
Installment Amount ( ) Due Date Installment Amount ( ) Due Date
IN LUMP SUM, 36 MONTHS
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AFTER DATE OF LAST DRAW
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DOWN
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Name:___________________________ Signature: __________________________
Name:___________________________ Signature: __________________________
Name:___________________________ Signature: __________________________
Name:___________________________ Signature: __________________________
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Acknowledgement of
Irrevocable Joint and Several Guarantee
We have reviewed the conditions and provisions of the Facility Contract
dated 20/08/98 signed between the Commercial Bank of Kuwait (hereinafter
referred to as the "Bank") and its customer mr/Messrs TELESOURCE CNMI
INC.__________________________________
(hereinafter referred to as the "Debtor"). We hereby acknowledge that we
agree to be bound towards you jointly with the Debtor for all obligations
and amounts, whatsoever, owing to the Bank under the above contract for
any reason, whatsoever. This guarantee covers all amounts charged to the
account(s) on which the facilities have been granted in any form and the
overdrawn balance existing in the account upon closing it or any other
account on which the facilities are being used. This guarantee is
continuous, unconditional and irrevocable. Under this guarantee, the Bank
may claim us for the outstanding debt balance arising from the above
contract and all related interests, expenses, commissions and others
without us having the right to oppose thereto. Our guarantee shall remain
valid, continuous and legally binding in the event of renewal, extension
or amendment of the facility contract for any reason, whatsoever until
the Bank recovers all its rights from the guaranteed debtor. It is
understood that all monies, securities, commercial papers, precious
metals, goods and other rights, whatsoever, registered or deposited in
our name at present or to be registered or deposited in our name in
future with the Bank or any of its branches in Kuwait or abroad guarantee
the fulfillment of our obligations hereunder without the need to
acknowledge the same. The Bank may recover its debt directly from me
monies mentioned above byway of priority set-off and precedence over any
other creditor without notice, wanting or any other action, whatsoever,
and without prejudice to the Bank's right to take the necessary actions
to recover its rights in full. The Bank may deduct the debt guaranteed by
us from any accounts open at present or to be opened in our name in
future with any of Its branches in Kuwait abroad without any notice,
warning or any other action, whatsoever. We understand that we submit to
all the provisions stipulated in the facility contract mentioned above.
We also undertake to provide the Bank with any statements they may
require at any time on current financial position or balance sheet
provided we substantiate our responses with evidencing documents. This
guarantee shall be governed by law applicable in Kuwait and to the sole
jurisdiction of the Kuwaiti courts. We accept the local jurisdiction of
the city courts in respect of any depute arising hereunder.
Joint Guarantor
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Name of Joint Guarantor(s) Account No. Signatures
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FOUAD SAUD XXXXX XXXXXXXXX /s/ Fouad Saud Xxxxx Xxxxxxxxx
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NASRALLAR SAUD XXXXX XXXXXXXXX /s/ Nasrallar Saud Xxxxx Xxxxxxxxx
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SAYED XXXXX XXXXXXXXX & SONS CO. W.L.L. /s/ Sayed Xxxxx Xxxxxxxxx & Sons Co. W.L.L.
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Guarantor(s) Address:
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Date:
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