LOAN CONTRACT Supervised by Bank of Beijing Co., Ltd. Loan Contract
(English
Translation)
Exhibit
10.16
Supervised
by Bank of Beijing Co., Ltd.
No.:
0019360
Borrower:
Beijing
PKU Chinafront Technology Co., Ltd.
(hereinafter referred to as “Party A”)
Address:
Room 717, E-wing Center, Haidian District Post code:
100086
Organization
code: 80202395-x Legal
Representative:
Xia Shudong
Tel:
00000000 Fax:
00000000
Bank:
Bank
of
Beijing Youyi Branch Account
No.:
0109100960012015026942
Lender:
Bank of Beijing Co., Ltd. Youyi Branch (hereinafter referred to as “Party
B”)
Address:
Haidian Xxx-xxxx Xxxxxxx, Xx.0, Xxxxxxxxxxxx Xxxxx Xxxxxx Post code:
100081
Organization
code: Legal
Representative/
Principal: Xx Xxxxxxx
Tel:
00000000 Fax:
00000000
In
accordance with relevant laws, regulations and rules, this Contract is concluded
by and between Party A and Party B through negotiations and by adhering to
the
principle of honesty, credit, equality and voluntariness, whereby both Parties
will observe and implement the Contract.
Chapter
1 Loan Type
Article
1
Party B agrees to provide short-term loan (short-term/
medium/
long-term loan) to Party A as agreed in the Contract.
Chapter
2 Uses of Loan
Article
2
Loans under the Contract will be used to supplement
the working capital.
Without
the written consent of Party B, Party A shall not make a bold to change the
uses
of loan determined in the Contract.
Chapter
3 Loan Amount and Term
Article
3
The loan under the Contract is denominated in RMB,
with an
amount of (in capital) THREE
MILLION YUAN,
(in
figure) 3,000,000.
Article
4
The term of the loan hereof is one month/
year,
commencing from September
15, 2006
to
September
15, 2007.
Article
5
Prior to the expiry of the loan term hereinbefore, in the event that Party
A
thinks it needs to extend the term, it shall render the Application for Loan
Extension to Party B 30 days prior to the
expiry of the loan. After acquiring the consent of Party B, Party A, Party
B and
its warrantor shall conclude a Loan Extension Agreement together.
Chapter
4 Loan Interest Rate and Interests
Article
6
Loan interest rate
6.1
The
annual interest rate of the loan hereof is 6-12%,
with
monthly interest rate of 5-1%;
6.2
The
interest rates of medium and long-term loans will be determined by year, and
are
subject to the initiation date of the loan term stipulated in the Contract.
The
next-year interest rate will be determined according to the loan interest rate
of the corresponding level when each year of loan expires and will be carried
out, which will not be deemed as a modification to the Contract;
6.3
In
the event that the People’s Bank of China adjusts the interest rate or the
method of determining interest rates during the implementation of the Contract
and such adjustment applies to the loan hereof, the relevant provisions of
the
People’s Bank of China shall be carried out, which will not be deemed as a
modification to the Contract.
Article
7
Interests
7.1
Interests of the loan hereof will be calculated by day as of the date when
the
loan is issued, and will be settled by quarter
(month/
quarter). The date of interest settlement is the 20th
of each
last month of a quarter (month/
last
month of a quarter);
7.2
In
the event that the interest payment date is not the business day of Party B,
the
interest payment date will be extended to the following first business day
of
Party B;
7.3
Party
A, when repaying the principal of the loan, shall clear the interests with
the
principal paid, and is not bounded by this Article;
7.4
Party
B will collect the compound interests to the accrued interests of Party A in
accordance with relevant provisions of the People’s Bank of
China;
7.5
In
case that the People’s Bank of China revises provisions on the calculation of
interests during the implementation of the Contract, and the revision adapts
to
the loan hereof, Party B may follow the relevant provisions of the People’s Bank
of China without informing Party B, which will not be deemed as a modification
to the Contract.
Chapter
5 Loan Withdrawal
Article
8
Unless the following preconditions are satisfied, Party B is not obliged to
provide the loan under the Contract to Party A:
8.1
Party
A shall fill in relevant due xxxx of loan and provide relevant files and
materials as required by Party B when making each withdrawal;
8.2
In
case that the loan hereof is guaranteed, Party A shall transact the legal
procedures in accordance with the requirements of Party B, such as the
notarization and/ or registration of the Guaranty Contract, and guarantee that
the guarantee will remain valid;
8.3
No
breach of the contract events listed in the Contract happens.
Article
9
Party A shall act according to Article 9.1 when withdrawing loans under the
Contract:
9.1
Single transfer: Party B will transfer the loan in full amount to that account
that Party A opened at Party B on September 15, 2006;
9.2
Series transfer: the loan will be withdrawn according to the time and amount
listed in the following table:
|
No.
|
Time
of withdrawal
|
Amount
(in capital)
|
Remarks
|
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|
1
|
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|
2
|
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|
3
|
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|
4
|
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|
5
|
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Article
10 Once the principal of the loan hereof has been transferred to the account
of
Party A in accordance with Article 8, it will be deemed that Party B has issued
the loan, and Party A has committed to borrow the amount concerned, also, the
loan provided by Party B begins to generate interests.
Article
11 In the event that the loan amount, loan date, repayment date are
differentiated from that recorded on the due xxxx of loan, records on the due
xxxx of loan shall prevail. The due xxxx of loan constitutes an ingredient
of
the Contract, and is of equal legal force as the Contract.
Chapter
6 Repayment of Loan
Article
12 Party A shall pay interests as stipulated in the Contract, and repay
principals of the loan as agreed in Article 12.1:
12.1
Principal repayment on maturity date: Party A shall repay all principal of
the
loan on September
15, 2007.
12.2
Repay the principal by installment according to the date and amount listed
in
the following table.
|
No.
|
Time
of repayment
|
Amount
(in capital)
|
Remarks
|
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|
1
|
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|
2
|
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|
3
|
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|
4
|
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|
5
|
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Article
13 Party B is entitled to deduct the principal, interest (including the penalty
interest and compound interest) and other accrued expenses, which Party A shall
pay according to the Contract, from the account of Party A opened at all the
branches of the Bank of Beijing.
Article
14 In case that Party A intends to repay the loan in advance, it shall give
a
30-day prior written application to Party B and acquire the consent of Party
B;
Party B is entitled to collect interests at the term and interest rate
stipulated in the Contract.
Chapter
7 Guarantee
Article
15 The guarantee of the loan hereof is in the form of: guarantee
of joint and several liability mortgage pledge. Party B and the
warrantor will conclude the first Guaranty Contract for detailed guaranty
issues:
15.1
Guarantee Contract with the number of 0019360;
15.2
Pledge Contract with the number of _______;
15.3
Mortgage Contract with the number of _______;
Party
A
hereby confirms that Party B is entitled to exercise the rights in the guaranty
contracts listed in this Article to realize the creditor’s rights of Party B.
Party A gives up all pleas on the rights of Party B hereinbefore.
Chapter
8 Declaration and Guarantee of Party A
Article
16 Party A hereby declares and guarantees that:
16.1
Party A is a(n)(√legal
person/ other organizations/ natural person) that exists legally in accordance
with the laws of the People’s Republic of China, and has independent and
integral civil capacity;
16.2
This
borrowing behavior is determined or authorized by the competent decision-making
organ (or person) of Party A, and is the authentic and effective meaning
expression of Party A;
16.3
Party A guarantees that the uses of the loan hereof are in compliance with
the
provisions of laws, regulations, administrative regulations, departmental rules,
industrial rules and the Articles of Association or constitutional files of
Party A, and has acquired relevant approval and authorization;
16.4
Party A guarantees that the materials and information that it provided to Party
B are authentic, accurate and integrated;
16.5
Party A guarantees that during the validity of the Contract, when it needs
to
undertake liabilities or provide warranty to other persons, it will inform
Party
B in writing 10 days prior to the happening of the event.
Chapter
9 Rights and Obligations of Both Parties
Article
17 The rights and obligations of Party A are as follows:
17.1
Party A is entitled to withdraw and use the loan according to the term and
uses
stipulated in the Contract;
17.2
Party A shall repay both the principal and interests of the loan as agreed
in
the Contract;
17.3
Party A shall accept the investigation, understanding and supervision of Party
B
to the uses of the loan under the Contract;
17.4
Party A shall actively cooperate with Party B in the investigation,
understanding and supervision of Party B to its production, operation and
financial position, and provide copies of its financial statements by month
to
Party B, such as the Balance Sheet, Income Statement, and Cash Flow
Statement;
17.5
In
the case that any event may constitute threats to the formal operation of Party
A or constitute material threat to Party A performing its repayment
responsibility under the Contract, Party A shall inform Party B in writing
immediately;
17.6
In
case that Party A has gone through activities that may change the
debtor-creditor relationship of the Contract or affect the rights and interests
of Party B, such as consolidation, spin-off, joint-stock reconstruction,
contract, lease, asset transfer, joint ownership, investment, applying for
suspending business for rectification, applying for dissolution, applying for
bankruptcy, Party A shall notify Party B in advance and get the written consent
of Party B, or it shall not carry out the behaviors hereinbefore before paying
off the loan under the Contract;
17.7
During the validity of the Contract, Party A shall inform Party B of the changes
of name, address or legal representative within 3 legitimate working days after
the changes;
17.8
In
case that Party A needs to transfer its debt under the Contract to the third
party, it shall acquire the written consent of Party B.
Article
18 Rights and Obligations of Party B
18.1
Party B is entitled to investigate, understand and supervise the operation
of
Party A and the uses of the loan, as well as require Party A to provide
materials concerning the loan hereof;
18.2
Party B is entitled to deduct the principal, interests, penalty interests,
compound interests and other accrued expenses that Party A shall pay according
to the Contract from the account of Party A;
18.3
Party B is entitled to withdraw the principal, interests, penalty interests,
compound interests of the loan hereof and all the other accrued expenses in
advance if any of the circumstances stipulated in Article 19
appears;
18.4
Party B shall loan to Party A as agreed in the Contract;
18.5
Party B shall keep the confidential materials and information provided by Party
A in secret, exclusive of the legal consultation;
18.6
Though there is no need for Party B to acquire the consent of Party A when
transferring its creditor’s right under the Contract to the third party, it
shall notify Party A after the conclusion of the contract for the transfer
of
creditor’s rights;
18.7
Unless Party B agrees, the payment of Party A shall liquidate the creditor’s
right of Party B according to the following sequence: (1) expenses arising
from
the realization of the creditor’s right; (2) compound interest; (3) penalty
interests for overdue payment; (4) interests; (5) principal.
Chapter
10 Responsibility for Breach of Contract
Article
19 Responsibility for breach of the contract
19.1
After the Contract comes into force, both Party A and Party B shall perform
their duties stipulated in the Contract, any Party, who does not perform or
partially perform his duties stipulated in the Contract, or violates any of
its
declarations and guarantees made in the Contract, shall assume corresponding
responsibilities for breach of contract, and compensate losses therefrom
suffered by the other party.
19.2
In
the event that Party A fails to repay the principal according to the repayment
date stipulated in the Contract, Party B is entitled to collect the penalty
interests at the rate of 23.8‰ per day against the overdue amount and days;
meanwhile, collect compound interests against the overdue interests according
to
pertinent provisions of the People’s Bank of China; in case that Party A fails
to use the loan as agreed in the Contract, Party B may calculate the penalty
interests at 3.06‰ per day against the embezzled amount and
days.
19.3
In
case that it is due to the default of Party A that Party B has to realize its
creditor’s right by means of litigation, Party A shall bear all expenses arising
from the realization of the creditor’s right, such as the litigation fees,
attorney fees, traveling expenses and other expenses.
Article
20 In case of any of the following circumstances, Party B is entitled to
announce the maturity of the Contract immediately, withdraw all the loans that
it has issued and stop issuing any loan further.
20.1
Party A fails to use the loan as agreed in the Contract, or pay interest or
principals on schedule;
20.2
During the validity of the Contract, Party A encounters such circumstances
as
poor management, losses or virtual gain and real loss, or debt dispute, or
damage or loss of the mortgaged or pledged goods under the contract and other
circumstances that may threat the loan safety;
20.3
Party A provides fake financial statements or financial statements holding
back
important facts to Party B or refuses to accept the supervision of Party B
to
its uses of loan, production, operation and financial activities;
20.4
Party A fails to perform any obligation stipulated in the Contract, or violates
any statement and guarantee hereof, or the warrantor fails to perform any duty
provided in the Guaranty Contract;
20.5
Party A encounters any event that may threaten the creditor’s right of Party B
while performing the Contract.
Chapter
11 Force Majeure
Article
21 In case that it is due to the force majeure that Party A cannot fulfill
his
duties under the Contract, Party A shall inform Party A within three legitimate
working days as of the date when the force majeure happened, and provide the
written certificate on the force majeure issued by local notary office; and
negotiate with Party B to conclude an agreement on the modification of the
Contract. Otherwise, Party B is entitled to deem that the loan expires and
require Party A to repay the principal and interests of the loan hereof in
advance and write off the loan limit that has not been
withdrawn.
Chapter
12 Dispute Resolution
Article
22 All disputes arising from the implementation of the Contract shall be settled
through negotiations. Should no agreement is reached through negotiations and
an
litigation is necessary, it is under the jurisdiction of the People’s Count
where Party B is located (domicile of Party A/ domicile of Party B/ the place
where the Contract is entered into).
Chapter
13 Effectiveness, Modification and Termination of the
Contract
Article
23 The Contract will come into force according to the second mode:
23.1
Come
into force after being signed and stamped by the legal representatives of Party
A and Party B/ Principals or their authorized representatives;
23.2
Come
into being after being signed and stamped by the legal representatives of Party
A and Party B/ Principals or their authorized representatives, and come into
force as of the date when the Guaranty Contract stipulated in Chapter 7 of
the
Contract goes into effect.
Article
24 After the Contract goes into effect, neither Party A nor Party B shall make
a
bold to change or terminate the Contract in advance. When it is necessary to
modify or terminate the Contract, both Parties shall reach consensus through
negotiations and concluded written agreement.
Chapter
14 Attachment
Article
25 Attachments of the Contract are as follows:
25.1
Due
xxxx of the loan
25.2
25.3
25.4
25.5
Article
26 Attachments of the Contract constitute the indispensable parts of the
Contract and are of equal legal force as the text of the Contract.
Chapter
15 Supplementary Provisions
Article
27 Notices in the form of telegraph or fax will be deemed as arrival when sent
out; notices in the form mail will be deemed as arrival 3 days after the
mailing.
Article
28 Other issues agreed by both Parties:
___________________________________________________________
___________________________________________________________
___________________________________________________________
Article
29 Party A and Party B may agree on matters uncovered in the Contract and reach
written agreement.
Article
30 This Contract is made in triplicate, with Party A, Party B and the
guarantee
company
holding
one of equal legal force.
Article
31 This Contract is concluded by and between Party A and Party B in Haidian
District
on
September
15, 2006.
| Party A (Stamp): | Party B (Stamp): |
| Legal Representative (Signature): | Legal Representative (Signature): |
| (Or Authorized Representative) | (Or Authorized Representative) |
