Agreement on Imported Material for Processing
EXHIBIT
4.17
Party
A:
Shenzhen Long Gong City Ping Hu Golden Bright Factory
(or
named
Processing Factory below)
Party
B:
Golden Bright Plastic Manufacturing Co. Ltd.
Business
Unit: Shenzhen Long Gong City Foreign Economic Services Company
The
three
parties are on the basis of obeying the laws and related regulations of PRC,
with equality and mutual benefits. Regarding to the processing assembly of
plastic products, electronic assembly, toy products, etc business for Party
B,
it is agreed unanimously as follows:
1. Responsibility
of each party:
Party
A responsible to -
| 1) |
Provides
location on Long Gong City, gross area is 1,000 square meter., with
50-100
workers, for production of the above processing assembly product
to Party
B for delivery to Hong Kong and other
countries.
|
| 2) |
Provides
the existing facilities of water and electricity supply for production.
Party B is responsible for the newly installation of facilities and
the
consumption of water on production and electricity
expenses.
|
| 3) |
Provides
assistance to Party B on import and export
issues.
|
| 4) |
Provides
the factory manager, accounting and warehouse personnel for supervising
the operation of factory and finance
management.
|
Party
B responsible to -
| 1) |
Provides
the production equipment facilities without asking to pay
(see attached list). The
value of the equipment is HK$300,000. The property right belongs
to Party
B.
|
| 2) |
Without
asking to pay to provide the processing raw material, accessory material,
packaging material etc.
|
| 3) |
Suggests
Party A to change the workers if the workers cannot reach the standard
after training but have no right to layoff
workers.
|
| 4) |
Pays
any charges imposed on supervising the processing raw material, accessory
material, packaging material etc.
|
2.
The Processing Quantity:
| 1) |
90,000
orders quantity will be processed by Party B in the First Year and
the
processing fee is approximately HK$30,000 paid by Party A. There
shall be
increment of processing quantity in the Second Year. Party B shall
fix the
processing quantity based on this agreement (Production
Contract)
|
3.
The Local Labor Working Fee:
| 1) |
The
trail (training) period is 3 months. During the trail period, the
monthly
local labor working fee is HK$550 per head (25 working days per month
and
eight hours per day). Party B shall get the approval from Party A
for
arranging work overtime and the extra allowances shall be added to
the
normal local labor working fee.
|
| 2) |
After
the trail period, the monthly local labor working fee is set as HK$650
or
above per head and shall be adjusted according to inflation rate
in every
two years.
|
| 3) |
Party
B is responsible for the consumption of water on production and
electricity expenses.
|
| 4) |
Party
B shall pay the fixed local labor working fee HK$13,000 monthly for
the
factory and production facilities provided by Party A and remit to
Party A
through the bank in China. The fee shall be adjusted according to
inflation rate in every two years.
|
| 5) |
Party
B shall not pay the working fee to the workers directly. The working
fee
must remit to Party A according to the regulation of
country.
|
4. Ratio
of Wastage:
| 1) |
During
trial production period, Party B provides the raw and accessory materials
without asking to pay, and report the actual
wastage.
|
| 2) |
After
the trial production period, the ratio of wastage is agreed by both
parties, and list out in the Production
Contract.
|
5. Imported
Material and Delivery:
| 1) |
Party
B should fix the processing quantity based on this agreement (Production
Contract), and provide enough raw & accessory material, and packaging
materials for each month usage. In order for the normal production
in
factory, Party B is required to deliver the raw & accessory material,
and packaging materials to the Processing Factory seven days in advance
before the start of production.
|
| 2) |
In
order for Party B to start the normal activities, the Processing
Factory
should deliver to Party B according to the agreed delivery date,
time,
quality, and quantity stated in the Production
Contract.
|
| 3) |
Party
B provides the machinery, light, ventilation facilities and raw &
accessory material, packaging materials etc. The transaction takes
place
in the Processing Factory. After processing the products by the Processing
Factory, Party B inspects the products and arrange transportation,
and the
Processing Factory will not be responsible for any shortage and re-do
work.
|
6. Way
of Remittance:
| 1) |
Local
labor working fee is to be settled monthly. Party B is required to
purchase the bank draft (or cashier order) from the bank in Hong
Kong to
Party A. Party A can draw the money from the bank issued the bank
draft
through the Bank of China (Long Gong branch) by the Business Unit,
Shenzhen Long Gong City Foreign Economic Services Company. If the
payment
is 15 days overdue, additional interest based on current bank interest
rate is required to pay to Party A. If the payment is 30 days overdue,
Party A reserves the right to stop the delivery or take any other
actions.
|
7. Transportation
and Insurance:
| 1) |
Party
B provides the equipment facilities, raw & accessory materials,
packaging material and also responsible for the transportation expense
after processing by the Processing
Factory.
|
| 2) |
Party
B should buy the insurance from China People’s Insurance Co Ltd covering
the risk for importing of raw, accessory and packaging material;
exporting
of finished products; the equipment facilities, the raw, accessory
and
packaging material stored in the factory during the processing period;
as
well as the labour and property risk.
|
8. Exchange
of Technology:
After
the
machinery facilities arrived at the Processing Factory, Party B should arrange
technician to install the machineries as soon as possible. The Processing
Factory shall provide assistance. Starting from the trial production period,
Party B should arrange technological training to the workers until the workers
can basically understand the production technology and process the normal
production. Party B is responsible for the trainer salary and all training
expenses. The Processing Factory is responsible to provide a convenient living
condition for the appointed trainers.
9. Arbitration
:
Any
unclear issues in this agreement, both parties can compromise to change and
supplement. In case of any dispute, both parties should try to solve the
dispute
in a harmonious way. If the dispute can be solved, the case shall be filed
to
the China International Trade Development Committee and the Foreign Economic
Trade Arbitrary Committee Shenzhen Branch Committee for arbitration. Both
parties should obey the final decision made by the arbitration. The fail
party
is responsible for the arbitrary expense.
10.
Validity
of Agreement :
This
agreement is valid for 7 years with immediate effect from the date approved
by
the related authority and signed by all parties. The validity period is February
20, 1993 to February 20, 1999. For any early termination or extension of
this
agreement, it is required to give 3 months’ notice to the other party. Both
parties shall agree and the related authorities shall approve for the
termination or extension. The party terminated the agreement shall pay one
month
local labor working fee to the other party as compensation.
After
the
expiry of the agreement, the property right of the fixed assets (e.g. factory,
dormitory building) and any machinery sold to Party A before shall belong
to
Party A. The property right of the movable assets provided by Party B (e.g.
machinery, facilities, vehicles etc) without asking to pay before shall belong
to Party B and is required to handle according to the regulations set by
Customs.
Any
party
fails to execute this agreement after the agreement come into effective for
two
months, the other party reserves the right to terminate the agreement after
getting the approval from the related authority.
If
Party
B fails to produce in six consecutive months, Party A reserves the right
to
terminate the agreement after getting the approval from the related authority.
Party B shall compensate any losses occurred to Party A.
This
Agreement has 6 original copies. Party A, Party B and the Business Unit will
each have a set of original copy that all have equal binding power. There
are
also several duplicate copies.
For
any
other issues not included in this agreement, amendment on this agreement
or
supplementary agreement shall be made and need the approval by the related
authority in order to come into effective.
Party
A:
Shenzhen Long Gong City Ping Hu Golden Bright Factory
Party
B:
Golden Bright Plastic Manufacturing Co. Ltd.
Business
Unit: Shenzhen Long Gong City Foreign Economic Services Company
(all
Parties signed and stamped)
Signed
in
Shenzhen on 17 February, 1993
