The Construction Bank of China
LOAN COLLATERAL AGREEMENT
No. of Contract: 96(W)004
Xxxxxxx (Party A): Xianyang Daming Electronics Co. Ltd.
Address: 00 Xxxx Xxxxxxx Xxxx, Xxxxxxxx
Xxxxx Representative: Mr. Du, Qingsong
Bank Account: Construction Bank of China, Xianyang Branch
Mortgagee: Construction Bank of China, Xianyang Branch
Address:
Legal Representative:
To secure the fulfillment of Loan Agreement No.96(w)004, Party A will pledge its
property to Party B, under Party B's agreement. It is agreed as follows on the
basis of applicable law and regulation.
1. Party A will provide collateral goods under the attached appendix as
security.
2. Party A will get a loan of RMB 1,100,000 from the bank. Term of the loan is
from Sep.16,1996 till Mar.15, 1997.
3 . Party A guarantees its ownership of the underlying collateral goods.
4. Party A will submit the title of pledged property to Party B during the
period of collateral contract, which will be preserved by Party B.
5. The collateral assets include the Principle of RMB 1,100,000, interest,
default fee, compensatory fee, and other costs occurred.
6. The enforcement of the collateral contract is not affected by the loan
agreement.
7. Party A will be responsible for any expenses on appraisal, insurance,
verification, registration and preservation.
8. During the period of the contract, Party A is obliged to maintain the good
condition of underlying collateral goods, keep them in good shape. Party B may
inspect the collateral goods at any time.
9. During the period of the contract, Party A should insure collateral goods.
Party B should be the first beneficiary. The insurance certificate will be
preserved by Party B.
10. During the period of the contract, if a loss occurred beyond the insurance
policy or if there is devalue on collateral goods due to the third party's
fault, compensatory fee will be deposited into Party B's account by Party A.
Party A will have no right to use the fee.
11. If there is a devalue on collateral goods, Party A will be asked to provide
a warranty in connection with the loss.
12. During the period of the contract , Party A will be responsible for any
environmental pollution or other damages caused by underlying collateral goods.
13. During the period of contract, Party A is not permitted to grant, move,
transfer, lease and pledge the underlying collateral goods without Party B's
consent.
14. During the period of the contract, the income from collateral goods will be
first used to pay off Party B's loan.
15. On expiration date of the contract, Party B will entitle to disposal the
collateral goods and receive the payment at first priority, if Party A fail to
pay off the loan.
16. Under following situation, Party B may disposal the collateral goods, stop
releasing the loan under the Loan Agreement or declare the unpaid principle and
the accrued interest due.
1. Party A is bankrupt or dismissed.
2. If Party A does anything against Xx.0, Xx.0, Xx.00, Xx.00, Xx.00 of the
agreement or seriously commits default of the agreement. 3. During the period of
the Loan Agreement, if the debtor is forced to go bankruptcy, be dismissed, or
change the status, fail to use the loan as his report in the agreement and
therefore get the Bank involved into the serious lawsuit (or arbitration), or
anything happen that enable the Debtor to pay off the loan or the Bank finds out
that he is no longer a bonafide Debtor any more.
17. If any economical loss occurred is due to co-own, dispute, detain or other
pledge under the same collateral goods, which facts is hidden by Party A, Party
A will be fined the default fee of % the loan. If it can not cover the actual
loss sustained by Party B, Party A would have to pay the rest of it.
18. Any income received by Party A from disposing the collateral goods will be
distributed as follows:
1. For payment of the expenses in connection with the
collateral goods;
2. Paying off the accrued interest due
3. Paying off the principle, default fee and compensatory fee;
4. Paying off other expenses.
19. Miscellaneous:
20. Should any dispute arise due to the collateral goods, it will be settled in
local court, if there is no agreement reached by two parties.
21. The collateral contract will take effective on the date of registration.
22. The collateral contract is taking effective by authorized signature and
seal.
23. The contract has two copies, one for each party.
Xianyang Daming Electronics Co., Ltd. (Seal) Construction Bank, Xianyang Branch
(seal) (seal)
Legal Representative Legal Representative
Sep. 16, 1996 Sep. 16, 1996
I. Appendix of Collateral Contract Contract No. 96(w)004
Collateral Goods List
Name of collateral: Horiz. Yoke Winder
Type: 181-III
Unit: Set
Quality: 7
Muniments of title and number:
Address: Workshop in Daming Electronics
Co., Ltd.
Collateral assets: RMB 11.32 million
The other collateral asset by same pledge:
Remarks: Original value RMB14 million
Xxxxxxx: Xianyang Daming Electronics Co.,
Ltd. (seal)
Legal representative:
Pledgee: Construction of China Xianyang
Branch (seal)
Legal representative:
