Pledge Contract of Maximum Amount
Exhibit 10.9
Pledge Contract of Maximum Amount
No. Xxxx Xxxxxxxx (Shuibei) Xxxxxxx Xxx Xx (2006) A110020600008
Xxxxxxx: Shenzhen BAK Battery Co., Ltd
Address: BAK Industry Zone, Kuichong, Longgang, Shenzhen
Creditor: Shuibei Branch, Shenzhen Commercial Bank
Address: Xx. 0000, Xxxxxx Xxx Xx, Xxxxxxxx
The Creditor and the Xxxxxxx have reached the following agreement in accordance with the Guarantee Law of People’s Republic of China and other relevant laws and regulations:
Article I. Pledge
| 1.1 | Shenzhen BAK Battery Co., Ltd. and Shuibei Division, Shenzhen Commercial Bank have entered into the Comprehensive Credit Facilities Agreement (reference no: Xxxx Xxxxxxxx (Shuibei) Shouxin Zi (2006) A110020600008, hereinafter referred to as “Master Agreement”). As requested by the Creditor, the Xxxxxxx undertakes to provide certificate of fixed deposit as pledge (hereinafter referred to as “Pledged Collateral”) for the indebtedness of the Xxxxxxx under the Master Agreement. |
| The details of the Pledged Collateral are described in the attached “Statement of Pledged Collateral” and relevant certificate, which are integral parts to this Contract. |
| The co-owner (if any) agrees to provide the aforesaid guaranty for the indebtedness of the Xxxxxxx under the Master Agreement. |
| 1.2 | The pledge shall cover all of the loan principal, interest, penalty interest, compound interest, breach of contract compensation, damages, undertaking fee and all the expenses such as litigation/arbitration cost, lawyer’s fee, travel cost etc. which is incurred to the Creditor in realizing its Creditor’s right. |
| The maximum loan principal shall be RMB 50 million yuan. The interest, compound interest, penalty interest and other expenses shall be determined in accordance with actual circumstances. |
| 1.3 | The value of the Pledged Collateral shall be determined when realizing the pledge. Party A shall bear the obligation of guaranty for the indebtedness under the Master Agreement within the limit of the value of the Pledged Collateral. In case of discrepancy between Clause 1.2 and this Clause 1.3, this Clause 1.3 shall prevail. |
| 1.4 | The guaranty of pledge provided by the Xxxxxxx is independent from other forms of guaranty. It shall not be replaced by other forms of guaranty either. |
| 1.5 | This Contract is irrevocable. This Contract shall not be influenced by any documentation or agreement entered into by the Xxxxxxx and any party, and shall not be influenced by the misuse of the credit facilities, insolvency, bankruptcy, loss of legal person status, amendment of articles of association, cease of business operation, acquisition, division and merger etc. of the Xxxxxxx, nor any change of the profession, position or financial capacity of the Xxxxxxx. |
| 1.6 | This Contract shall remain valid in case of invalidity of the Master Agreement or relevant agreements entered into under the Master Agreement. |
| 1.7 | The Xxxxxxx shall deliver the Pledged Collateral, accessory of the Pledged Collateral and relevant original certificates of the Pledged Collateral to the |
Creditor. Once the indebtedness under the Master Agreement has been settled, the guaranty of pledge shall be automatically terminated and the Creditor shall return the aforesaid Pledged Collateral, accessory of the Pledged Collateral and relevant original certificates of the Pledged Collateral to the Xxxxxxx.
Article II. Delivery of the Pledged Collateral
| 2.1 | The Xxxxxxx should deliver the accessory of the Pledged Collateral and relevant original certificates of the Pledged Collateral to the Creditor before May 8, 2006. |
| The delivery of the Pledged Collateral shall be recorded and confirmed by the statement signed by both Parties. |
| 2.2 | In case that registration of pledge or endorsement of bill is required, the Xxxxxxx shall complete all the required legal formalities and provide the original documentations to the Creditor. |
| 2.3 | The Creditor is entitled to demand the Xxxxxxx to conduct notary with enforcement power for this Contract. |
Article III. Insurance
| 3.1 | The Creditor is entitled to demand the Xxxxxxx to underwrite insurance for the Pledged Collateral and the first beneficiary under such insurance shall be the Creditor. The insured amount shall be (remaining balance of the bank loan principal + estimated interest within the credit facility term) X 110% and the insurance period shall be credit facility term + 5 months. |
| 3.2 | The Xxxxxxx shall pay the insurance fee timely and shall perform all the obligations under the insurance agreement. |
| 3.3 | The Xxxxxxx shall renew the insurance before all indebtedness under the Master Agreement has been settled. In case of Xxxxxxx’x failure to renew the insurance in time, the Creditor is entitled to renew the insurance at the cost of the Xxxxxxx. |
| 3.4 | In case of loss or damage of the Pledged Collateral, the insurance compensation shall first be paid to the Creditor for the settlement of the indebtedness under the Master Agreement. |
| 3.5 | The original insurance policy shall be kept by the Creditor before all the indebtedness under the Master Agreement has been settled. |
Article IV. Undertakings and Representations of the Xxxxxxx
| 4.1 | The Xxxxxxx has read the Master Agreement carefully and accepts all clauses of the Master Agreement. The Xxxxxxx agrees to sign this Contract of its own will. |
| 4.2 | The execution and alteration of the relevant agreements entered into by the Creditor and the Xxxxxxx under the Master Agreement do not need the confirmation of the Xxxxxxx unless such agreements are in conflict with the Master Agreement. The Xxxxxxx undertakes that the Xxxxxxx shall continue to assume the obligation of pledge in case of the amendment of the Master Agreement by the Creditor and the Xxxxxxx and such amendment does not need the consent of the Xxxxxxx. Without prejudice to the above, the Xxxxxxx shall assume the obligation of pledge for the indebtedness under the Master Agreement before the amendment if such amendment increases the indebtedness of the Xxxxxxx and such amendment has not been approved by the Xxxxxxx in writing. |
| 4.3 | The Xxxxxxx undertakes that all the documentation, materials and information provided by the Xxxxxxx to the Creditor are authentic, accurate, complete and valid. |
| 4.4 | The Pledged Collateral is owned by the Xxxxxxx and there is no legal dispute over the ownership of the Pledged Collateral. The Pledged Collateral has not been pledged to any other party. The Xxxxxxx has obtained all necessary authorization or approval to execute and perform this Contract. |
| 4.5 | The Xxxxxxx shall not transfer, donate, allow any other party to use or create any other security right over the Pledged Collateral or dispose of the Pledged Collateral in any other form without written consent by the Creditor. |
| 4.6 | The Xxxxxxx agrees that the Creditor may designate a third party to keep the Pledged Collateral as deemed necessary by the Creditor. |
Article V. Performance of Pledge
| 5.1 | The Creditor is entitled to execute the pledge rights under one of the following circumstances: |
| (1) | the Xxxxxxx fails to pay the principal/interest or any cost under the Master Agreement upon expiry of such indebtedness (or upon expiry date as declared by the Creditor); |
| (2) | The Xxxxxxx transfers, donates, allows any other party to use or creates any other security right over the Pledged Collateral or disposes of the Pledged Collateral in any other form without written consent by the Creditor; |
| (3) | The Xxxxxxx is dissolved, terminated or declared bankruptcy; |
| (4) | The Pledged Collateral is damaged or devaluates to the detriment of the Creditor without any fault of the Creditor and the Xxxxxxx fails to provide any other security as required by the Creditor; |
| (5) | Any other circumstances as determined by laws. |
| 5.2 | Under the abovementioned circumstances, the Creditor is entitled to sell the Pledged Collateral by auction or by any other ways or directly offset the indebtedness by agreements with the Xxxxxxx. |
| 5.3 | The Xxxxxxx irrevocably authorizes the Creditor to have the interests of pledge (including but not limited to interests, dividends, charge for use) after the second month of Xxxxxxx violates the Master Agreement and the Creditor shall assistant the Xxxxxxx to execute the above rights unconditionally. |
Article VI Breach of Contract
| 6.1 | In case that this Contract or the pledge under this Contract become invalid, terminated due to failure of the Xxxxxxx to perform any obligations under this Contract, and the Xxxxxxx fails to provide any other form of guaranty as required by the Creditor, then the Xxxxxxx shall bear the following liabilities for breach of contract: |
| The Xxxxxxx shall pay all the indebtedness under the Master Agreement and pay a breach of compensation equivalent to 10% of the remaining balance of the principal under the Master Agreement. |
| 6.2 | In case that the value of the Pledged Collateral is decreased due to failure of the Xxxxxxx to perform any obligations under this Contract, and the Xxxxxxx fails to recover the value of the Pledged Collateral or provide any other form of guaranty as required by the Creditor, then the Xxxxxxx shall bear the following liabilities for breach of contract: |
| The Xxxxxxx shall pay all the indebtedness under the Master Agreement and pay a breach of compensation equivalent to 5% of the remaining balance of the principal under the Master Agreement. |
Article VII. Other Issues Agreed by Both Parties
N/A
Article VIII. Miscellaneous
| 8.1 | The Xxxxxxx shall bear all the cost for the assessment, registration, notary, maintenance, storage, repair, insurance, transportation for the Pledged Collateral. |
| 8.2 | Any dispute arising from this Contract shall be submitted to the People’s Court of the place of the Creditor and the laws of People’s Republic of China shall be the governing law. |
| 8.3 | This Contract shall come into effect once it is signed by the Xxxxxxx and the legal representative/authorized representative of the Creditor and stamped with the company stamp of the Xxxxxxx and the pledge is delivered to the Creditor by the Xxxxxxx. If the pledge is required to be registered or the relevant bill is required to be endorsed, this Contract shall come into effect once the pledge has been registered or bill endorsement has been accomplished. The Contract shall be terminated once all indebtedness, its interests and other expenses have been fully paid off. |
| 8.4 | This Contract has five originals, the Creditor shall retain two originals, the Xxxxxxx shall retain one original, the Obligator shall retain one original and the registered bureau shall retain one original. |
| Xxxxxxx (Stamp): [Company chop of Shenzhen BAK Battery Co., Ltd.] |
| Legal Representative/Authorized Representative (Signature): /s/ |
| Date: 8 May 2006 |
| Venue: Shenzhen |
| Creditor (Stamp): [Company chop of Shubei Branch, Shenzhen Commercial Bank] |
| Legal Representative/Authorized Representative (Signature): /s/ |
| Date: 8 May 2006 |
| Venue: Shenzhen |
Appendix: Statement of Pledged Collateral
No. Xxxx Xxxxxxxx (Shuibei) Xxxxxxx Xxx Xx (2006) A110020600008
May 8, 2006
Name: Certificate of Fixed Deposit
No. of Certificate: XX00004184
Quantity: 1
Unit: RMB Yuan
Original Value: RMB 50,000,000 yuan
Assessed Gross Valuation: RMB 50,000,000 yuan
Delivered by : [company chop of Shenzhen BAK Battery Co., Ltd.]
Date:
Received by [company chop of Shuibei Branch, Shenzhen Commercial Bank]
Date:
