EXHIBIT 2.1
Translation From Japanese contract between Chiba Bank Ltd and Xxx Tokyo Co Ltd.
Financial Loan Document
Chiba Bank Ltd
25th March 2005
On behalf of Xxx Tokyo Co. Ltd.
Tokyo-to, Adachi-ku, higashi-hokima,
Xx. Xxxxxxxx Xxxxx, CEO
Guarantor
Tokyo-to, Taito-ku, Nihon-tsutusmi 1-30-1
Xx. Xxxxxxxx Xxxxx
1. Borrowing Terms
The borrower, has agreed on the following terms and for the following amount to
receive a loan and hereby confirms the write of same.
1. Borrowed Amount: YEN 100,000,000
2. Borrowing Purpose: long term working capital
3. Interest Rate: 2.900% (1 year to be calculated as 365 days)
4. Final repayment date: 25 March 2008
5. Repayment Schedule:
(1) First payment: 25 April 2005, First payment amount: YEN 2,800,000
(2) Last payment amount: YEN 2,000,000
(3) 2nd payment onwards, not including last payment
Schedule: from May 2005 - February 2008, a total of 34 payments
of YEN 2,800,000 each
(4) Each payment shall be made on the 25 day of every month
6. Interest payment method:
(1) Interest payments are seen to be allocated to the first part of
the repayment schedule
(2) The first payment of interest is due on the loan date, the second
payment on the 25th day of the first month of 2nd repayment
installment.
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7. Automatic deduction from account: The repayment amounts as discussed
in 5 and 6 above, shall be automatically deducted from the borrowers
account on the 25 day of each month. If repayment date falls on
holiday, then repayment shall be made on following work day.
8. Account for automatic deduction: The borrowers account for repayment
automatic deduction shall be Kanemachi Branch, Normal Account, Account
Number XXXXXX.
9. Security Deposit Association: not applicable
10. Penalty: If the borrower does not repay the money as per the terms of
this agreement, a penalty rate of 14% shall be paid on the outstanding
balance (calculated as 1 year being 365 days).
11.
(1) Special provisions: In respect to the automatic deduction of
repayment installments The bank will not receive as payment of
the required installments, such items as cheques, notes, or cash
payment. All payments shall be made as automatic deductions from
the account specified above. Should there not be sufficient funds
in that account at the time of deduction, the bank may accept
payment from the borrower the amount required for repayment. If
the borrower cannot pay by the required date, provision 10 will
indicate the required penalty.
(2) Bank charges deductible from account also If there are any small
charges association with this loan document, or provision for
receiving payment under this document, the bank may deduct these
charges from the account.
Bank Code: XXX-XXXXX-XXXXXXX
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2. Note.
If the borrower deposits with the bank a Note to show ability to repay
loan installments, the bank may be allowed to use these funds to clear
repayments under the schedule as provided for.
3. Interest Rate Fluctuations
The bank shall have the ability to change the rate of interest on this
loan in accordance with general banking provisions and customs that
would allow such.
4. Security
(1) If the bank requires further security on the loan or increasing
the security from the guarantor they may ask for this from time
to time.
(2) If the borrower does not fulfill the conditions under this loan
document, the bank is authorized to act in a legal manner with
regard to gaining title to any security under this loan, whether
by the borrower or the guarantor.
5. Restrictions on conditions of loan
If the borrower presents any of the following reasons, the bank may
determine to recalculate the repayment schedule for the loan or move
to have the loan cancelled and repaid immediately
(1) If the borrower fails to make repayments or becomes bankrupt, is
involved in a Chapter 7 or 11 winding up, or any other special
circumstance involving the ending of business operations
(2) If the borrower receives notice of inability to furnish cheques
as per the instruction of the cheque clearing house.
(3) If the borrower or Guarantor have a claim order placed against
their assets.
(4) If the borrowers (in the case of a company, the CEO of the
borrower) address becomes unknown to the bank
In the following circumstances, after giving notice to the borrower,
the bank may determine to recalculate the repayment schedule for the
loan or move to have the loan cancelled and repaid immediately.
(1) If the borrower is late in repaying any installment
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(2) If there is a lien or claim placed against any asset put up for
security
(3) If the borrower does not abide by the terms of conditions
(4) If the guarantor does not abide by the terms of conditions
(5) If any other condition arises requiring the bank to take
necessary action
6. Calculation
(1) If the bank suffers loss due to non-payment of amounts under this
loan agreement, then the bank may offset such loss with any other
assets of the borrower that the bank is custodian for.
(2) If the bank plans to offset any asset as indicated above, then
the bank will give advance notice to the borrower of such, and
offer the borrower the chance to provide other means for payment
first.
(3) In 6.1, if the bank uses such assets to repay the loan, the bank
may calculate loss of interest and fees up to the date of return.
6.2 Calculation (continued)
(1) If the time for repayment has been exceeded, the borrower may
still repay the loan by use of its assets which may be in the
custody of the bank.
(2) If under the above section, the borrower makes such offset, it
must offer notice in writing to the bank and sign such required
documentation to effect the transfer of assets to the bank.
(3) In above section, outstanding interest or fees must also be
calculated and paid to the bank.
7. Note, Exchange
(1) If a Note has been exchanged with the bank as security for this
loan, then under section 6 if amounts are required to be
calculated, such Note may be utilized and is not required to be
returned.
(2) If in section 2 a Note exists that is to be offset against the
debt, the borrower shall ensure that the rights to the Note are
available to the bank immediately.
(3) If the bank under Section 6 plans to assume the rights under a
Note, under certain circumstances this will not be possible:
1. if the bank cannot locate the borrower
2. if the borrower is using the bank as point of payment on the
Note
3. if there is some problem surrounding the Note
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4. If there is any other reason why the Note can not be used
(4) If under section 2 a Note has been issued, and calculation for
return of funds has been made, and there is notice of other
claimants to the Note, the bank shall stop such Note and process
it.
8. Appropriation
If the borrower has insufficient funds for repayment of debt amount or
for calculation as under section 6, the bank may choose suitable means
of appropriation.
(1) If under section 6.2 above the borrower makes payment to cancel
any deficit on the loan, if any amount remains outstanding, the
bank may make appropriations for the amount as requested by the
borrower.
(2) If the borrower does not make any request in 8.1, the bank may
make its own determination for appropriation and the borrower may
not object to this.
(3) If under 8.1 the borrowers requested method may lead to damage to
assets, then the bank may without delay object to the method of
appropriation and determine its own means for appropriation
instead.
(4) Under 8.2 if the bank determines its own method for appropriation
of funds, this method shall also determine the period under which
the borrower shall remain liable for amounts under this contract.
9. Risk-bearing
(1) If for any reason, the documentation surrounding this loan should
be lost, destroyed or otherwise become unavailable, the bank may
with reference to its internal records, reconstruct the
documentation. In such a case the borrower may not make any claim
against the bank.
(2) If due to such loss or damage above, the borrowers collateral
should suffer some damage, the bank will not be held liable.
(3) If for any reason, under circumstances where a Note has been
passed, that Note should be rendered invalid or unavailable for
presentation due to the banks conduct, the bank shall take
responsibility for that Notes value.
(4) If any documentation surrounding a Note shall be found to be
incorrect, or fraudulently produced, the borrower shall bear all
liability for the documentation.
(5) The borrower shall be liable for any charges required for
ensuring the safety of any security or Notes passed to the bank.
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10. Change of Notification Matter
(1) If there is any change to notification matters of the borrower
such as business name, change of officers, change of address,
then the borrower shall inform the bank immediately.
(2) if the borrower has a change as above, and due to that notices
from the bank are delayed or do not arrive, such notices will be
deemed delivered as if they had been under normal circumstances.
11. Reporting and Investigation
(1) If the bank requests information about the borrowers financial or
business status, the borrower shall provide such information
immediately. If investigation is required, the borrower will make
materials available.
(2) If there is a significant change in the financial or business
status of the borrower, the bank can request a report on this.
12. Creation of Notarial Deed
If the borrower receives a request to notarize agreements in a Deed,
then they will organize this. Further, the cost of notarization shall
be paid by the borrower.
13. Agreement Jurisdiction
If there should be any disagreement over this agreement requiring
legal process, the jurisdiction of courts will be that closest to
Kanemachi Branch of the bank.
14. Guarantor
(1) The Guarantor assumes responsibility for all losses that may
result to the Bank out of the non performance of this contract by
the borrower.
(2) The Guarantor agrees not to make claim to any assets of the
borrower under control of the bank.
(3) If the Guarantor should be guarantor for the borrower on any
other matter, this contract shall not affect such other matter,
neither shall any agreement to limit the amount of guarantee on
an other matter have any affect on this contract.
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