Renminbi Loan Agreement Zhengzhou Branch of China CITIC Bank
EXHIBIT
10.17.3
Contract
Number: No. 081710 (2008) of Henan Bank Loan
Zhengzhou
Branch of China CITIC Bank
1
Borrower:
Henan Gerui Composite Materials Co., Ltd. (hereinafter referred to as “Party
A”)
Address:
Shuanghu Economic Development Zone, Zhengzhou
Postal
Code: 451191
Telephone:
0000-00000000
FAX:
0000-00000000
Legal
Representative: Xxxxxxxx Xx
Bank Name
and Account Number: Banking Department of Zhengzhou Branch of China CITIC Bank
7391010182600094320
Lender:
Zhengzhou Branch of China CITIC Bank
Address:
Xx.00 Xxxxxxx Xxxxx Xxxx, Xxxxxxxxx
Postal
Code: 450008
Telephone:
0000-00000000
FAX:
0000-00000000
Legal
Representative/Responsible Person: Rongxing Dou
Contract
Location: Zhengzhou
Contract
Date: July 16, 2008
In
pursuance to the relevant laws, regulations, and rules, such as “Contract Law of
the People’s Republic of China” and the “General Rules on Loans”, Party A and
Party B hereby entered this Contract after consideration of the foregoing and
the mutual covenants and conditions contained herein:
Article
I Type of Loan
1.1 Party
B agrees to provide Item (1) of the following
types of loans to Party A in accordance with the terms stipulated under this
Contract:
(1)
Short-Term Loan; (2) Medium-Term Loan; (3) Long-Term Loan.
Article
II Amount of Loan (Principle, similarly hereinafter) and Loan
Period
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*
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This
form of agreement is also used for the following
loans:
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Loan
in amount of RMB 5,000,000 valid from August 4, 2008 to August 3,
2009
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Loan
in amount of RMB 15,000,000 valid from June 17, 2008 to June 16,
2009
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Loan
in amount of RMB 8,000,000 valid from August 28, 2008 to February 28,
2009
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Loan
in amount of RMB 10,000,000 valid from September 1, 2008 to March 1,
2009
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Loan
in amount of RMB 10,000,000 valid from September 2, 2008 to March 2,
2009
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Loan
in amount of RMB 12,000,000 valid from September 3, 2008 to March 3,
2009
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2
2.1 The
loan amount under this Contract is Renminbi: Five Million Yuan
(￥5,000,000.00).
2.2 The
loan period under this Contract is one year, from July
16, 2008 to July 15, 2009.
2.3 The
actual loan period, actual withdrawal date, and the loan amount shall be
determined by the period, date, and the amount stated under the Loan Note of
this Contract. The Loan Note shall be an integral part of this Contract and
shall have the same legal effect as this Contract.
Article
III Purpose of Loan
3.1 The
loan under this Contract shall be used to supplement the working
capital. Party A shall not change the purpose of this loan without a
written approval from Party B. In case that Party A changes the purpose of the
loan without a written approval from Party B or violates the provisions of the
“General Rules on Loans” or other laws, regulations, and rule, Party B shall not
bear any responsibility resulting from the illegal use of this
loan.
Article
IV Interest Rate and Interest of Loan
4.1 The
interest rate of this loan shall be determined by Item (1) of the
followings:
(1) Based
on the actual withdrawal day of the loan, a floating rate of plus 10 (% or BPs) of
the prime interest rate for the same period and same type of loan from the China
People’s Bank. Hence, the interest rate of the loan for this Contract
is 8.217%.
(2) Based
on the contract day of the loan, a floating rate of ---- (% or BPs) of
the prime interest rate for the same period and same type of loan from the China
People’s Bank. Hence, the interest rate of the loan for this Contract is --- %.
4.2 The
interest rate adjustment method shall be determined by Item (2) of the
followings for this loan.
(1) Fixed
interest rate, which shall remain unchanged during the loan period.
(2) Floating
interest rate, which shall undergo adjustment based on Item ③
of the followings. The adjusted interest rate of the loan shall be the
determined interest rate based on the applicable prime interest rate for the
same period and same type of loan from the China People’s Bank undergoing
adjustment on the day of adjustment of interest rate in accordance with Article
4.1 of this Contract
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① From the day of
the actual withdrawal, the interest rate shall be adjusted every---months. The
interest rate adjustment day shall be the day corresponds to the actual
withdrawal day for the adjusted month. In case that the adjusted month has no
day corresponding to the actual withdrawal day, the last calendar day of the
adjusted month shall be the interest rate adjustment day.
② From the day of
the actual withdrawal, the interest rate shall be adjusted on --- Year --- Month --- Day, with the
interest rate being adjusted every--- months after the
interest rate adjustment day. The interest rate adjustment day shall be the day
corresponds to the day for the first interest rate adjustment day. In
case that the adjusted month has no day corresponding to the first interest rate
adjustment day, the last calendar day of the adjusted month shall be the
interest rate adjustment day.
③ From the day of
the actual withdrawal, the adjustment day of the prime interest rate of the
China People’s Bank shall be the adjustment day for the interest rate of this
loan.
4.3 The
interest period shall commence on the day of actual withdrawal for this
loan. The calculation formula for the interest shall be: interest =
actual balance of the loan × the actual days of the loan period × interest
rate/360 days.
4.4 For
the loan that is not repaying principal and interest in a lump sum, the first
day of interest settlement shall be July 20, 2008. The interest
calculating method shall be determined by Item (1) of the
followings:
(1) Monthly,
which shall be the 20th of
every month;
(2) Quarterly,
which shall be the 20th of the
last month in a quarter.
4.5 Prior
to every date of interest settlement, Party A shall prepare sufficient amount of
money in the account opened in Party B for Party B to timely deduct the interest
from the account. In case that Party A chooses other method for
interest payment to Party B, Party A shall assure the timely transfer of
interest to Party B. In case that the date of the interest settlement
is a bank non-working day, the money shall be transferred one bank working day
in advance. Should Party B fail to receive the corresponding interest
in full on the date of interest settlement, the act shall be deemed as delay
interest payment of Party A.
4.6 The
interests and the principal shall be fully paid upon expiration of the loan
period. In case that the expiration date of the loan is a legal
holiday or non-working day, the loan shall be settled on the last bank working
day before the legal holiday or the non-working day. The interest
shall be calculated in accordance with the contract interest rate. However, the
interest corresponding to the number of days between the date of expiration and
the settlement date that is calculated according to the contract interest rate
shall be deducted. Should the loan fail to be settled on the first
bank working day after the legal holiday or the non-working day, interest shall
be calculated according to the terms for overdue loan, starting from that
date.
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Article
V Withdrawal
5.1 Party
A shall make withdrawal according to the following schedule. The
planned withdrawal dates shall be bank working days.
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Item
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Date
of Withdrawal
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Amount
of Withdrawal
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1.
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July
16, 2008
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￥5,000,000.00
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---
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---
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---
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---
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---
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---
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5.2 In
case that Party A or the Guarantor fails to fulfill all the obligations required
by the laws or stipulated under this Contract, including but not limited to
Party A fails to timely provide the complete loan materials as required by Party
B and the Guarantor fails to timely complete the guarantee registration
procedure, Party A agrees that Party B shall have the right to change the
aforementioned withdrawal schedule. Should the change of withdrawal
plan cause change in the loan period, the terms stipulated under Article 2.3 of
this Contract shall be followed.
5.3 Unless
specified otherwise by this Contract, Party A shall undergo withdrawal in
accordance with the withdrawal schedule stipulated under this
Contract. Party A shall not change the withdrawal schedule without
written approval from Party B. Should the withdrawal time and/or
withdrawal amount be changed, Party A shall notify Party B in writing with five bank working
days in advance. Party B agrees to grant five bank working
days of withdrawal grace period. If the loan is not withdrawn at the
end of the grace period, this loan shall be deemed as voluntary forfeit by Party
A. Party A shall not undergo withdrawal of this loan any more and
shall bear the responsibilities for breach of contract in accordance with the
terms stipulated under Article 12.2 of this Contract.
5.4 Where
Party A voluntarily cancel the loan leading to the change in the actual release
of the principle of the loan by Party B, the actual occurred loan notes under
this Contract shall be used to calculate the principle of the loan under this
Contract.
5.5 Three
bank working days before every planned withdrawal date, Party A shall submit an
irrevocable withdrawal note or loan note or other withdrawal notice to Party B
in accordance with the withdrawal schedule stated in the aforementioned Article
5.1 or in accordance with the modified withdrawal schedule agreed by Party B in
writing. The loan shall be released after examination and approval by
Party B in accordance with the notice. The notice shall be used as
proof of the withdrawal. In case that Party A fails to either submit
the withdrawal notice or a request for delayed withdrawal, the terms stipulated
under Article 5.3 shall be followed.
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Article
VI Repayment Method
6.1 Item
(1) of the
following repayment methods shall be used for the loan stated under this
Contract:
(1) Fixed
date of interest payment with repayment of principle upon expiration of
loan;
(2) Repayment
of interests and principle in one lump sum;
(3) Other
method:
6.2 Party
A shall repay the principle in accordance with the following
schedule:
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Item
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Date
of Repayment
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Amount
of Repayment
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1.
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July
15, 2009
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￥5,000,000.00
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---
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---
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---
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---
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---
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---
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---
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---
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---
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---
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---
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---
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6.3 An
amount not lower than the interests and principle of the loan that should be
repaid by Party A shall be transferred to the account opened in Party B (Account
number: 7391010182600094320)
before the date of the repayment. Party A shall authorize Party B to
deduct the interests and principle of the loan automatically from the
account.
6.4 Where
Party A desires to settle the loan early, a written irrevocable early repayment
schedule shall be submitted to Party B with 30 days in advance before the date
of planned loan settlement. Party A must receive a written approval
from Party B.
Article
VII Extension Period of Loan
7.1 Where
Party A fails to repay the loan stated under this Contract and needs to extend
the loan period, a written application shall be submitted to Party B with thirty bank working
days in advance before the expiration of the loan. A loan extension
agreement shall be signed after examination and approval from Party
B. In case that Party B disapproves the loan extension, Party A shall
timely repay the loan. Otherwise, Party B shall have the right to
treat this loan as an overdue loan.
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Article
VIII Guarantee of Loan
8.1 Item(s)
(2) & (3)
of the following guarantee methods shall be used for the loan stated under this
Contract:
(1) Mortgage
guarantee;
(2) Collateral
guarantee;
(3) Warrandice;
(4) Other
types of guarantee:
Party B
and the Guarantor shall sign the following numbered guarantee contracts
regarding the specific guarantee matters for the aforementioned
guarantee(s).
(1) Contract Number 081710 of
Chattel Mortgage Contract
(2) No. 081710 (2008) of Maximum
Guarantee of Zhengzhou Branch of China CITIC Bank
(3) ---
(4) ---
Article
IX Declaration and Guarantee of Party A
9.1 Party
A is a Chinese legal entity or other organization that is legally established in
accordance with the laws of the People’s Republic of China, shall legally have
the civil right capacity and action capacity necessary for the signing and
execution of this Contract, and shall be able to bear the civil responsibilities
independently. Moreover, Party A has already received all the
internal and external approvals and authorizations necessary and legally for the
signing of this agreement.
9.2 All
the documents, reports, and statements provided by Party A in accordance with
the laws and the requirements of Party B are all valid, legal, truthful,
accurate, and complete.
Article
X Rights and Obligations of Party A
10.1
Party A shall have the right to withdraw and use the loan in accordance with the
period and purposed stipulated under this Contract.
10.2
Party A shall fully repay the principle and interests of the loan in accordance
with the terms stipulated under this Contract.
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12.4.10
Party A fails to fulfill the related matters, such as settlement or deposit at
Party B as contracted;
12.4.11
Party A arbitrarily changes the purpose of loan;
12.4.12
The senior managerial personnel of Party A are suspected in case(s) of major
corruption, bribery, embezzlement, or other illegal operation(s);
12.4.13
Occurrence of breach of contract by Party A with other creditors;
12.4.14
Violation of terms or breach of contract stipulated under guarantee contracts by
the Guarantor of Party A;
12.4.15
Other matters by Party A jeopardizing and damaging or possibly jeopardizing and
damaging the interests of Party B.
12.5
Party B shall have the right to charge additional 50% of penalty
interest rate in accordance with the actual number of days of delay and the
applicable interest rate at that time for the loan of this Contract in addition
to the right of exercising the rights stipulated under Article
12.4.
12.6
Where Party A fails to timely pay the interest, Party B shall have the right to
calculate and collect compound interests in accordance with the actual number of
days of delay and the penalty interest rate stipulated under Article
12.5
12.7
Where Party A fails to use the loan in accordance with the purpose stipulated
under this Contract, Party B shall have the right to charge additional 100% of penalty
interest rate in accordance with the actual number of days of delay and the
applicable interest rate at that time for the loan of this Contract on the
portion of the illegal use, starting from the day of the illegal use in addition
to the right of exercising the rights stipulated under Article
12.4.
12.8
Where Party A repays the loan early, Party B shall have the right to charge one
lump-sum penalty in accordance with the amount of early repayment, remaining
loan period, the interest rate of loan as stated under this Contract, and the
--- % of rate.
The formula for calculating penalty is: penalty = amount of early repayment ×
remaining loan period (calculated based on year) × interest rate of the loan as
stated under this Contract × rate.
12.9 All
the costs (including but not limited to litigation fees, traveling expenses,
attorney fee (within 100% of the total amount of the creditor’s rights),
property preservation fee, notarization fee, translation fee, appraisal, and
auction fee) incurred on Party B to actualize creditor’s rights shall be borne
by Party A.
Article
XIII Continuity of Obligations
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13.1 All
obligations of Party A stated in this Contract shall have continuity, which
shall have full binding force to its inheritor, receiver, transferee, and the
entity after merger, restructuring, and name change and shall be not be impacted
in any way by any dispute, claim, legal proceeding, directive orders from higher
authorities and debtor of the main contract and any contract or agreement signed
with any natural persons or legal persons. Moreover, the obligations
shall not be changed in any ways as result of bankruptcy, inability to repay
debts, loss of business qualifications, and change of articles of
association.
Article
XIV Notarization
14.1 In
case that any side of the contracted parties makes a notarization request, the
notarization of this Contract shall be carried out at the notarization
authorities authorized by the State. Party A shall bear the cost.
14.2 In
case Party B makes the request of notarization with effective compulsory
execution, Party A agrees that Party B may take this Contract and apply to the
relevant notarization authority for the issuance of notarization with effective
compulsory execution. Should Party B fail to receive full repayment
of the principle and interests of the loan and the related costs within the time
limit stipulated under this Contract, Party B may directly take this
notarization to the local People’s Court of Party B and apply for compulsory
execution. All incurred costs shall be borne by Party
A. Party A unconditionally agrees that the local court of Party B may
legally undergo compulsory execution and that all the rights to defense shall be
forfeited.
Article
XV Other Agreed Matters
Party A guarantee that no
capital of this bank loan shall enter the stock market or real estate market
through its own bank account or bank account(s) of any other third
party. Otherwise, any loss incurred on Party B shall be borne by
Party A.
In case
that the terms stipulated under this article in contradiction with the terms
stipulated under other articles, the terms of this article shall
prevail.
Article
XVI Applicable Laws
16.1 The
laws of the People’s Republic of China shall be applicable for this
Contract.
Article
XVII Settlement of Dispute
17.1 All
disputes in connection with this Contract of the execution thereof shall be
settled through friendly negotiations. In case that no settlement can
be reached through negotiations, both parties agree that Item (2) of the following
methods shall be used for settlement:
(1) Arbitration
at
Arbitration Commission;
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(2) Submission
of the case for prosecution or applying for compulsory execution to the local
People’s Court of Party B.
Article
XVIII Accumulation of Rights of Party B
18.1 The
rights of Party B under this Contract shall be cumulative and shall not impact
and exclude any rights enjoyed by Party B regarding Party A in accordance with
the laws and other contracts. Unless specified in writing by Party B
that Party B is not going to fully exercise, partly exercise, or delayed
exercise any of its rights, the waiver or partly waiver of the rights shall not
be constituted, and the continuous exercise of the rights or exercise of any
other rights shall not be impacted, hindered, and obstructed.
Article
XIX Effectiveness, Change, and Termination of Contract
19.1 This
Contract shall come into force upon signing by the legal representative or
authorized representative of Party A and the legal representative or responsible
person or authorized representative of Party B with affix of the official seals
or contract seals from both parties.
19.2
Unless specified otherwise in the Contract, neither Party A nor Party B shall
arbitrarily change or terminate this Contract after the entry into force of this
Contract. Where change or termination of this Contract is
necessary, both parties shall reach consensus and a written
agreement.
19.3
Party B may transfer all or part of the creditor’s rights stated under this
Contract to a third party after the entry into force of this Contract and does
not have to receive permission from Party A. However, Party A shall
be notified in writing.
19.4
After the entry into force of this Contract, where Party A transfers all or part
of the debt to a third party, a written document approving the transfer and the
continuous fulfillment of obligation by the guarantor or a new guarantee is
submitted to Party B. A written approval must be obtained from Party
B.
Article
XX Miscellaneous
20.1
Party A and Party B may reach a written agreement on matters not discussed in
this Contract and shall be an attachment of this Contract. Any
attachment, modification, or supplement to this Contract shall be an integral
part of this Contract and shall have the same legal force.
20.2 In
case that certain article or part of an article of this Contract is deemed
invalid, the invalid article or the invalid part shall not impact the
effectiveness of this Contract and other articles or other content of the
article of this Contract.
20.3 Any
notification, request, or other communications, including but not limited to
telex, telegraph, and FAX delivered to Party A from Party B regarding this
Contract shall be deemed received by Party A upon
delivery. Registered postal mails shall be deemed received by Party A
starting on the third day from the mailing day.
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20.4 This
Contract is made out in three original copies
with Party A holding one copy, Party B
holding one
copy, and the relevant authority holding one
copy.
20.5
Party B has already taken reasonable method to draw attention to Party A
regarding the terms excluding or limiting its responsibilities under this
Contract and has provided sufficient explanation regarding the relevant articles
in accordance with the request of Party A. Both Party A and Party B
have no misunderstanding regarding the content of all the articles stipulated
under this Contract.
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Party
A (Official Seal or Contract Seal)
Legal
Representative:
(or
Authorized Representative)
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Party
B (Official Seal or Contract Seal)
Legal
Representative/Responsible Person:
(or
Authorized Representative)
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