Agricultural Bank of China Pattern Contract Loan Agreement November 2004
Exhibit
10.16
Agricultural
Bank of China
Pattern
Contract
November
2004
ABCS(2004)1001
Borrowing
Contract
Contract
No. NO42101200600009897
Borrower
(full name): Wuhan
Blower Co., Ltd.
Lender
(full name): Agricultural
Bank of China Wuhan Qingshan Branch
This
contract is entered by and between the two parties above via negotiation
pursuant to relevant laws and regulations of PRC.
Article
1: Loan
1.
Type
of loan: Short
term floating capital loan
2.
Purpose of loan: Purchase
of raw material
3.
Currency and sum of loan: RMB
TEN MILLION YUAN
4.
Loan
period:
(1)
See
following table for loan period.
|
Release
|
Due
|
|||||
|
Date
|
Amount
|
Date
|
Amount
|
|||
|
October
30, 2006
|
TEN
MILLION YUAN
|
October
30, 2007
|
TEN
MILLION YUAN
|
|||
(Form
attached due to insufficient rows is a component part of this
contract.)
(2)
In
the case that the amount, release date and due date in this contract are not
consistent with those in the loan certificate, the latter is seen as standard.
The loan certificate is a component part of this contract and has equal legal
effect with the contract.
(3)
If
the loan is in foreign currency, the borrower has to return the principal and
interest in original currency on due.
5.
Interest rate of loan
The
interest rate is fixed according to first method below:
-2-
(1)
Floating interest rate
The
interest rate is 10%
above
benchmark rate, i.e. 6.732%
annually. The benchmark rate for loan of five years and below is the RMB
benchmark loan interest of the same period announced by People’s Bank of China;
the benchmark rate for loan above five years is the RMB benchmark loan interest
of the same period announced by People’s Bank of China plus ____ %.
The
period for interest rate adjustment is three
months.
If the People’s Bank of China adjusts the benchmark interest rate from the
corresponding day of the first month of the next period after the adjustment,
the interest rate of the loan is calculated based on the new interest rate
and
method above without additional notice to the borrower. If the benchmark
interest rate is adjusted on the same day as the loan release date or
corresponding day of the first month of the interest rate adjustment, the new
interest rate is adopted starting from the adjustment date. If there is no
corresponding day for the loan adjustment, the last day of the month is deemed
as the corresponding day of loan.
(2)
Fixed
interest rate
Interest
rate of loan is _____ above/below benchmark rate, i.e. _____ annually, till
the
due date. The benchmark rate for a loan of five years and below is the RMB
benchmark loan interest of the same period announced by People’s Bank of China;
the benchmark rate for a loan above five years is the RMB benchmark loan
interest of the same period announced by People’s Bank of China plus ____
%.
Foreign
exchange loan interest rate is fixed according to _____ method
below:
(1)
Floating interest loan by ____ month(s) made up of _____ month(s) of (LIBOR
/
HIBOR) plus interest difference of ____%. LIBOR / HIBOR is the London / Hongkong
interest rate of inter-bank lending interest rate of two working days before
the
interest calculation day corresponding period before announced by
Reuters.
(2)
Interest rate of loan is _____ % annually till the due date.
(3)
Other
methods:_______________________________________.
6.
Interest settlement
Interest
of the loan under this contract is settled by
month
(month/season),
and the settlement day is the 20th
of
each
month
(each
month/the last month of each quarter). The borrower shall pay the interest
on
the settlement day. If the last maturity day of loan principal is not on
interest settlement day, the unpaid interest shall be settled together with
the
principal. (Daily interest rate = monthly interest rate/30)
Article
2:
If
following conditions are not met, the lender shall have the right to cancel
the
provision of loan under this contract:
1.
The
borrower opens a
general savings account
with the
lender.
-3-
2.
The
borrower provides relevant documents and materials according to the requirement
of the borrower and settles relevant procedures.
3.
If the
loan under this contract is a foreign exchange loan and the borrower has already
handled approval, registration and other statutory procedures related to this
contract are governed according to relevant regulations.
4.
If the
loan under this contract has a mortgage or pledge, the legal procedures such
as
registration and insurance have been handled according to the lender’s
requirement, and the guarantee and insurance remains effective. If the loan
under this contract has guarantee, the guarantee contract has been signed and
has taken effect.
Article
3: Rights
and responsibilities of the lender
1.
The
lender is entitled to learn the operation status, financial activities,
inventory and use of the loan, etc., and require the borrower to provide
documents, material and information, such as financial statement.
2.
In the
case of behaviors or situations of the borrower including but not limited to
Sections 7, 8 and 10 of Article 4, the lender has the right to terminate the
release of the loan or withdraw the loan in advance.
3.
In the
case of withdrawing the loan principal, interest, default interest, compound
interest and other obligatory fees according to this contract or in advance,
the
lender can deduct from any account of the borrower.
4.
If the
amount paid back by the borrower is not enough to clear all amounts payable,
the
lender can choose to use the loan to cover the loan principal, interest, default
interest, compound interest and other obligatory fees.
5.
If the
borrower fails to fulfill the responsibility to pay back the loan, the lender
has the right to disclose such breach of contract to the public.
6.
Release loan in full amount on schedule according to this contract to the
borrower.
Article
4: Rights
and responsibilities of the borrower
1.
The
borrower has the right to obtain and use the loan according to stipulation
of
the contract.
2.
The
borrower has the right to handle settlement and saving related to the loan
under
this contract via the account stipulated in Article 2 of this
contract.
-4-
3.
If the
loan under this contract is a foreign exchange loan, the borrower shall handle
approval, registration and other statutory procedures related to this contract
according to relevant regulations.
4.
The
borrower shall return the principal and interest on time. If the borrower needs
to extend the loan period, it shall submit a written application to the lender
15 days before the due date and sign a loan period extension contract once
approved by the lender.
5.
The
borrower shall use the loan according to the purpose specified in this contract,
and impropriation or embezzlement is prohibited.
6.
The
borrower shall provide the lender with an authentic, complete and valid
financial statement and other relevant materials and information each month,
and
actively cooperate with the lender on supervision of its operation status,
financial activities and use of the loan.
7.
The
lender shall be informed of activities of the borrower that are sufficient
to
cause change in liability relation or affect realization of lender’s credit
right in advance, including contracting, renting, stock system reform, joint
operation, merger, acquisition, split-off, joint venture, asset transfer,
application for stop operation, application for disbandment, and application
for
bankruptcy, etc. Upon approval by the lender, the borrower shall carry out
the
responsibility for liquidation or liquidate debts in advance; otherwise,
activities above shall be implemented.
8.
Apart
from activities above, the borrower shall also inform the lender in writing
of
other situations that may lead to significant unfavorable influence on
fulfillment of responsibilities by the borrower, such as stop production, halt
of business, registration cancellation, business license revocation, legal
representative or main responsible person engaging in illegal activities and
involved in serious lawsuit or arbitration, serious difficulty in operation
and
deterioration in financial conditions, and implement credit guarantee measures
recognized by the lender.
9.
The
borrower shall also inform the lender in writing of its activities that may
affect its capability to pay back the loan under this contract in advance,
such
as guarantee for liability of a third party or mortgaging its main asset to
a
third party, and the lender’s approval shall be obtained before such
activities.
10.
The
borrower and its investors shall not withdraw or transfer the capital or
transfer their stocks at discretion with the purpose of evading liability to
the
lender.
11.
The
borrower shall promptly inform the lender in writing of changes of its name,
legal representative, residence and scope of business, etc.
-5-
12.
In
the case of stop production, halt of business, registration cancellation,
business license revocation, bankruptcy or operation loss of the guarantor
of
the loan under this contract, thus leading to complete or partial loss of
corresponding guarantee capability, or in the case of devaluation of collateral,
pledge or pledged right, the borrower shall provide the lender with other
guarantee measures recognized by the lender.
13.
The
lender shall bear various charges related to this contract and guarantee under
this contract, such as lawyer service, insurance, transport, evaluation,
registration, preservation, appraisal and notarization, etc.
Article
5:
Payment
repaid ahead of time
If
the
borrower intends to repay the loan ahead of time, the lender’s approval shall be
obtained. If the lender approves, interest for the portion repaid ahead of
time
is calculated according to first method below:
1.
Calculate according to loan period and interest rate stipulated in this
contract.
2.
Calculate according to actual loan period and interest rate stipulated in this
contract plus _____%.
Article
6:
Liability for breach of contract
1.
If the
lender fails to release the loan in full amount on schedule according to this
contract to the borrower, which incurs loss to the borrower, the lender shall
pay penalty for breach of contract to the borrower based on the amount of breach
and days delayed. The penalty for breach of contract is calculated in the same
way as the calculation of interest in the case of delayed
repayment.
2.
If the
borrower fails to pay back the loan principal according to the period specified
in this contract, the lender will collect default interest starting from the
date of delay of payment according to the interest rate of loan stipulated
in
this contract with 50
%
plus
until the principal and interest are paid off. During the delayed period in
the
case of RMB loan, if the People’s Bank of China raises the benchmark interest
rate of RMB loan, the default interest rate will be raised on the same day
accordingly.
3.
If the
borrower fails to use the loan according to the purpose specified in this
contract, the lender will collect a fine for breach of contract starting from
the date of breach according to the interest rate of loan stipulated in this
contract with 100
%
plus
until the principal and interest are paid off. During this period in the case
of
RMB loan, if the People’s Bank of China raises the benchmark interest rate of
RMB loan, the default interest rate will be raised on the same day
accordingly.
4.
For
payable interest that is not paid, the lender will collect compound interest
according to regulations issued by the People’s Bank of China.
-6-
5.
If the
borrower fails to bear the responsibility under this contract, the lender has
the right to require the borrower to correct the behaviors of the breach,
terminate the release of loan, withdraw the released loan in advance, announce
that other loan contracts between the lender and borrower are due immediately,
or take other asset guarantee measures.
6.
For
all actions taken by any guarantor under this contract going against the
responsibility specified in the guarantee contract, the lender has the right
to
terminate the release of loan, withdraw the released loan in advance, or take
other asset guarantee measures.
7.
If the
borrower breaches the contract and thus the lender has to realize its credit
right by means of litigation and arbitration, the borrower shall bear the lawyer
fee, travel expense and other relevant fees incurred to the borrower.
Article
7:
Loan
guarantee
The
loan
under this contract is guaranteed by means of mortgage,
while
the guarantee contract is to be signed separately. If maximum amount guarantee
is adopted, the guarantee contract number is: 42906200600004397.
Article
8:
Settlement of disputes
In
the
case disputes occur during implementation of this contract, the borrower and
the
lender can either settle them via negotiation or according to first method
below:
1.
Litigation, which is under the jurisdiction of people’s court where the lender's
domicile is located.
2.
Arbitration. Submit the case to _______________________________ (full name
of
the arbitration body according to its arbitration rules).
During
the process of litigation or arbitration, articles of this contract which are
not involved in arbitration will still be executed.
Article
9:
Other
issues
Article
10:
Effecting of the contract
This
contract takes effect upon signing and stamping by the borrower and
lender.
Article
11:
Number
of contract copies
This
contact is made out in
quintuplicate.
The
borrower, the lender, the guarantor, registration office of the Real Estate
Administration Bureau and Bureau of State Land and Resources hold
one original respectively,
which
shall have the same legal effect.
-7-
Article
12:
Note
The
lender has notified the borrower to have a comprehensive and accurate
understanding of articles of this contract, and has explained corresponding
articles as required by the borrower, thus both parties have a consistent
understanding of this contract while signing the contract.
| Borrower (SIGNATURE OR SEAL): |
Lender
(SIGNATURE
OR SEAL):
|
||
| Wuhan Blower Co., Ltd |
Agricultural
Bank of China Wuhan
Qingshan Branch
|
||
|
Legal
Representative
or
authorized agent:
/s/
Xx Xxx
(Seal)
|
Responsible
Person
or authorized agent: /s/
Piao
Gonggang
(Seal)
|
||
|
Signing
date: October 30, 2006
Signed
at: Agricultural Bank of China Wuhan Qingshan Branch
|
|||
-8-
