LOAN AGREEMENT
The
Loan Agreement (the "Agreement") is entered into as of February 18, 2008 between
the following two parties.
(1)
Xxxxxxx
Xxxxx (the "Lender"), an individual with
LEGAL ADDRESS: Room 102, Bing Suite, Xx.00 Xxxxxxxxxxxxx, Xxxxxxxxx,
Xxxxx 000000
(2)
Baby Fox
International, Inc. (the "Borrower"), a Nevada State company in the United
Steates of America, with
ADDRESS:
Minhang District, 00 Xxxxxxx Xxxx, Xxxxx 000-X0, Xxxxxxxx, X.X.
Xxxxx
The
Lender and the Borrower will each be referred to as "One Party" and the Lender
together with the Borrower will be referred to as "Both Parties"
collectively.
WHEREAS,
the Borrower holds 100% equity in Shanghai Baby Fox Fashion Co., Ltd. (the
"Borrower's Company"), a limited liability company registered in the People's
Republic of China (the "PRC").
WHEREAS,
the Lender is an individual P. R. China citizen, The Lender intends to provide a
loan to the Borrower.
NOW
THEREFORE, Both Parties agree as follows:
1.
LOAN
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1.1
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The
Lender agrees to provide a long-term loan to the Borrower with the
principal as US$ 810,160.25, with five percent of annual interest (5%), in
accordance with the terms and conditions set forth in this Agreement. Term
for such loan will be five (5) years and shall be extended upon the
agreement of Both Parties through negotiations. During the term or
extended term of such loan, the Borrower shall refund the loan ahead of
the loan term or the extended loan
term.
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1.2
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The
Lender agrees to remit the amount of such loan to the account designated
by the Borrower within seven (7) days after receiving the Borrower's
written notification to use the loan, provided that all of the
preconditions set forth in Section 2 of this Agreement are satisfied. The
Borrower shall issue confirmation notification to the Lender on the day
receiving the amount of the loan. The commitments of the Lender under this
section are effective only to the Borrower itself, but not the Borrower's
inheritor or transferee.
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1
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1.3
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The
Borrower agrees to accept such loan provided by the Lender and agrees and
warrants hereby such loan shall be used only for the investment in the
Borrower's Company to expand the business of the company. Without the
Lender's prior written consent, the Borrower shall not use the amount of
such loan for any other purpose or transfer or pledge its equity in the
Borrower's Company to any other third
party.
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2. PRECONDITIONS
OF THE LOAN
The
Lender will be liable to provide loan to the Borrower in accordance with Section
1.1 when all of the following conditions are satisfied or are waived by the
Lender in writing.
2.1 Subject
to the terms of Section 1.2, the Lender receives the drawing notice formally
issued by the Borrower.
3.
REPRESENTATION AND WARRANTIES
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3.1
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The
Lender hereby represents and warrants to the Borrower that, from the
execution date of this Agreement until the date this Agreement
terminates,
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(a)
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the
Lender is an individual existing under the laws of The People’s Republic
of China;
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(b)
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the
Lender has full right, power and all necessary and appropriate approval
and authorization to execute and perform this
Agreement;
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(c)
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the
execution and the performance of this Agreement shall not be
against any enforceable and effective laws and
regulations, governmental approval, authorization and
notification, other government documents and any contracts
executed with, or commitments made to, any third party;
and
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(d)
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this
Agreement shall constitute the legal, valid and
binding obligations of the Lender, which is enforceable against
the Lender in accordance with its terms upon its
execution.
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2
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3.2
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The
Borrower hereby represents and warrants that, from the
execution date of this Agreement until the date this Agreement
terminates,
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(a)
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the
Borrower's Company is a limited liability company registered
and validly existing under the laws of Nevada State in
the United States of America, and the Borrower is the legal
owner of its equity interest in the Borrower’s
Company;
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(b)
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subject
to its articles of association and other organizational
documents, the Borrower has full right, power and all necessary
and appropriate approval and authorization to execute and
perform this Agreement;
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(c)
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the
execution and the performance of this Agreement shall not be
against any enforceable and effective laws and
regulations, governmental approval, authorization and
notification, other government documents and any contracts
executed with, or commitments made to, any third
party;
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(d)
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this
Agreement shall constitute the legal and valid obligations of
the Borrower, which is enforceable against the Borrower in
accordance with its terms upon its
execution;
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(g)
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there
are no disputes and legal or other proceedings pending or
threatened before any court, tribunal or other
regulatory authority and involving the Borrower;
and
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(h)
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the
Borrower's Company has completed all governmental approval,
authorization, license, register, filing and otherwise
necessary to carry out the business subject to its business
license and to possess its assets.
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4. COMMITMENTS
OF BORROWER
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4.1
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The Borrower, as major shareholder of the Borrower's Company, agrees
that it shall cause the Borrower's Company, during the term of
this Agreement,
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(a)
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not
to supply, amend or modify its articles of association,
to increase or decrease its registered capital, or to change
its capital structure in any way without the Lender's
prior written consent;
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(b)
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subject
to good financial and business rules and practices, to maintain
and operate its business and handle matters prudently and
effectively;
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(c)
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not
to sell, transfer, mortgage, dispose of in any other way, or to
create other security interest on, any of its assets, business
or legal right to collect interests without the Lender's prior
written consent;
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(d)
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without
the Lender's prior written consent, not to create, succeed to,
guarantee or permit any debt, except (i)the debt arising in the
course of the ordinary or daily business operation, but not
arising from the loan, and (ii)the debt being reported to the
Lender or having approved by the Lender in
writing;
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(e)
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to
operate persistently all the business of the Borrower's Company
and to maintain the value of its
assets;
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(f)
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without
the Lender's prior written consent, not to execute any material
contracts (during this stage, a contract will be deemed
material if the value of it exceeds US$10,000) except those
executed during the ordinary
operation;
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(g)
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not
to provide loan or credit to any person without the Lender's
prior written consent; (h) to provide information
concerning all of its operation and financial affairs subject
to the Lender's request;
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(i)
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to
purchase insurance from the insurance company accepted by the
Lender and maintain persistently such insurance, provided that
the amount and type of such insurance are as the same as, or
equivalent to, the insurance amount and insurance type taken
out generally by the company which operates, in the
same territory, the similar business and possesses the
similar properties or
assets;
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(j)
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not
to merger or combine with, buy or invest in, any other person
without the Lender's prior written
consent;
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(k)
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to
inform promptly the Lender of the pending or threatened suit,
arbitration or regulatory procedure concerning the assets,
business or income of the Borrower's
Company;
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(l)
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to
execute all necessary or appropriate documents, to take
all necessary or appropriate action and to bring all necessary
or appropriate lawsuit or to make all necessary and
appropriate defending against all claims, in order to maintain
the ownership of the Borrower's Company for all its
assets;
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(m)
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without
the Lender's prior written consent, not to issue dividends to
each shareholder in any form, provided however, the Borrower's
Company shall promptly allocate all its allocable profits to
each of its shareholders upon the Lender's
request;
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(n)
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to
appoint any person designated by the Lender to be the director
of the Borrower's Company subject to the
Lender's request;
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4.2 The
Borrower agrees that it shall, during the term of this Agreement,
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(a)
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not
sell, transfer, mortgage, dispose of in any other way,
or create other security interest on, any of its legal right
of equity or equity interest without the Lender's prior
written consent
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(b)
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cause
the shareholder's meeting appointed by the Lender not to sell,
transfer, mortgage, dispose of in any other way, or to create
other security interest on, any of the Borrower's legal right
of equity or equity interest without the Lender's prior written
consent, except that the counter party is the Lender or those
designated by the Lender;
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(c)
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cause
the shareholder's meeting appointed by the Lender not to merge
or combine with, buy or invest in, any person without the
Lender's prior consent;
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(d)
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promptly
inform the Lender of the pending or threatened
suit, arbitration or regulatory procedure concerning the
Borrower's equity in the Borrower's
Company;
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(e)
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execute
all necessary or appropriate documents, take all necessary or
appropriate action and bring all necessary or appropriate
lawsuit or make all necessary and appropriate defending against
all claims, in order to maintain the ownership of the
Borrower's Company for all its
assets;
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(f)
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do
nothing that may materially affect the assets, business
and liabilities of the Borrower's Company without the
Lender's prior written
consent;
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(g)
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appoint
any person to be the director of the Borrower's Company subject
to the Lender's request;
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5. DEFAULT
The
Borrower shall pay the overdue interests with 0.01% per day of the overdue
amount until the Borrower refunds all of the principal, overdue interests of the
principal and other money, in the event when the Borrower dose not perform its
obligation of repayment.
6. NOTIFICATIONS
Notice
or other communications under this Contract shall be delivered personally or
sent by facsimile transmission or by registered mail to the address set forth
below, except that such address has been changed in writing. The date noted on
the return receipt of the registered mail is the service date of the notice if
the notice is sent by registered mail; the sending date is the service date of
the notice if the notice is sent personally or by facsimile transmission. The
original of the notice shall be sent personally or by registered mail to the
following address after the notice is sent by facsimile.
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the
Lender:
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Room
102, Bing Suite, Xx.00 Xxxxxxxxxxxxx, Xxxxxxxxx, Xxxxx
000000 Attn: Jie-min
Xxxxx
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the
Borrower:
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Minhang
District, 00 Xxxxxxx Xxxx, Xxxxx 000-X0, Xxxxxxxx, X.X.
Xxxxx Attn: Board of
Director
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7.
CONFIDENTIALITY
Both
parties acknowledge and confirm that any oral or written materials concerning
this Agreement exchanged between them are confidential information. Both parties
shall protect and maintain the confidentiality of all such confidential data and
information and shall not disclose to any third party without the other party's
written consent, except (a) the data or information that was in the public
domain or later becomes published or generally known to the public, provided
that it is not released by the receiving party, (b) the data or information that
shall be disclosed pursuant to applicable laws or regualtions,and (c) the data
or information that shall be disclosed to One Party's legal counsel or financial
counsel who shall also bear the obligation of maintaining the confidentiality
similar to the obligations hereof. The undue disclosing of the confidential data
or information of One Party's legal counsel or financial counsel shall be deemed
the undue disclosing of such party who shall take on the liability of breach of
this Agreement. This section shall survive after this Agreement terminates by
any reason.
8. GOVERNING
LAW AND SETTLEMENT OF DISPUTES
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3.1
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The
execution, validity, interpretation,
performance, implementation, termination and settlement of
disputes of this Agreement shall be governed by the laws of
PRC.
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3.2
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Both
Parties shall strive to settle any dispute arising from the
interpretation or performance in connection with this Agreement
through friendly consultation within 30 days after One Party
ask for consultation. In case no settlement can be reached
through consultation, One Party can submit such matter to China
International Economic and Trade Arbitration Commission (the
"CIETAC"). The arbitration shall follow the current rules of
CIETAC, and the arbitration proceedings shall take place in
Shanghai. The arbitration award shall be final and binding upon
the Both Parties and shall be enforceable in accordance as its
terms.
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3.3
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In
case of any disputes arising out of the interpretation
and performance of this Agreement or any pending arbitration
of such dispute, Both Parties shall continue to perform
their rights and obligations under this Agreement, except that
such maters are involved in the
disputes.
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9. MISCELLANEOUS
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9.1
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This
Agreement shall be effective as of the date of execution
and shall expire when Both Parties has fully performed their
obligations under this
Agreement.
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9.2
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This
Agreement is executed in English forms, and in case of
conflicts, the English version shall
prevail.
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9.3
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Both
Parties may amend and supply this Agreement with a
written agreement The amendment and supplement duly executed by
Both Parties shall be part of this Agreement and shall have the
same legal effect as this
Agreement.
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9.4
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Any
provision of this Agreement that is invalid or
unenforceable shall not affect the validity and enforceability
of any other provisions
hereof.
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9.5
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The
Appendices referred to in this Agreement are an integral part
of this Agreement and have the same legal effect as this
Agreement.
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the
Lender: Xxx-xxxx Xxxxx
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the
Borrower: Baby Fox International, Inc.
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Xxxx
Xxxx
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Vice
President of Finance
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