SHANGHAI PUDONG DEVELOPMENT BANK Contract for Guarantee of Maximum Line of Credit
Exhibit
10.6(a)
No.:
ZB7914200728056
SHANGHAI
PUDONG DEVELOPMENT BANK
Contract
for Guarantee of Maximum Line of Credit
Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
Contract
for Guarantee of Maximum Line of Credit
Guarantor:
Pan
Dangyu
Creditor:
Shanghai
Pudong Development Bank - Shenzhen Branch
WHEREAS,
In
order
to ensure that Debtor will fully and timely perform its obligations under the
Master Contract (see Article 7 hereof) and to secure the realization of
Creditor’s rights, Guarantor voluntarily offers to guarantee the repayment of
all the debts raised by Debtor under the Master Contract.
In
order
to specify the Parties’ rights and obligations, Guarantor and Creditor hereby
enter into this Contract upon negotiations to which they shall be
bound.
Article
1 Guaranteed Principal Credit
The
details about the principal credit guaranteed hereunder are set forth in Article
7 hereof.
Article
2 Responsibility for Guarantee
1.
|
Scope
of Guarantee
|
In
addition to the principal credit defined in this Contract, the Scope of
Guarantee hereunder covers also any and all interests accrued thereon (including
interests, penalty interests and compound interests), damages, compensations,
service charges and any other fees arising from the execution or performance
of
this Contract as well as expenses accrued for realizing Creditor’s guaranteed
rights and its credit (including but not limiting to disposal fees, taxes,
action expenses, auction fees, attorney fees, and travel expenses) and the
amount of security deposit additionally required by Creditor but unfulfilled
after the Master Contract enters into force.
2.
|
Manner
of Guarantee
|
Guarantee
hereunder shall be joint liability guarantee.
Guarantor
agrees and acknowledges that if Xxxxxx fails to fulfill its obligation to
repayment of debts under the Master Contract, Creditor shall have right to
require Guarantor, not other guarantor(s), at first to undertake its
responsibility for guarantee within the Scope agreed by him in this Contract,
no
matter whether Creditor otherwise has guaranteed rights to the credit under
the
Master Contract (including but not limiting to such manner of guarantee as
guarantee, mortgage, pledge, etc.).
Guarantor
hereby expressly waives its right to claim for advance fulfillment of material
guarantee provided by Debtor.
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
3.
|
Term
of Guarantee
|
The
Term
of Guarantee shall be calculated separately by individual particular debt owed
by Xxxxxx to Creditor, commencing from the date of expiry of the term for
payment of such debt under individual debt contract and ended by two years
thereafter.
Guarantor
shall be responsible to guarantee each installment repayment under individual
contracts executed during the Crediting Period and the term of such guarantee
shall commence from maturity of each installment debt until two years after
the
expiry date of the last installment repayment.
The
“maturity” and “expiry” referred herein include the circumstances upon which
Creditor declares earlier expiry.
If
the
principal credit is claimed to be expired earlier and it constitutes part or
all
of the credits accrued in the Crediting Period, the declared date of earlier
expiry shall be maturity of such part or all of the credits, and the Crediting
Period shall also be expired on the same date.
If
Creditor and Debtor have reached an agreement to renew the term for repayment
of
debts, the Term of Guarantee shall be ended by two years after the expiry of
the
renewed term for repayment of debts. The renewal of such term shall not be
subject to Guarantor’s consent, who shall still undertake joint liability for
guarantee.
4.
|
Amendment
to the Master Contract
|
Creditor’s
rights and interests hereunder shall not be affected by any grace or
postponement of repayment offered by Creditor to Debtor, or any modification,
amendment or replacement of any terms or conditions of the Master Contract
made
by Creditor and Debtor. Upon the above circumstances, it shall be deemed that
prior consent from Guarantor has already been obtained and Guarantor’s
responsibility for guarantee shall not be relieved thereby.
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
If
the
Master Contract allows Creditor to issue letter of credit, performance bond
or
standby letter of credit to Debtor, any modification made by Creditor and Debtor
to the letter of credit, performance bond or standby letter of credit under
the
Master Contract shall not be subject to the consent of Guarantor or otherwise
notice to Guarantor. Such modification shall be deemed that prior consent from
Guarantor has already been obtained and Guarantor’s responsibility for guarantee
shall not be relieved thereby.
Article
3 Representations and Warranties
Guarantor
hereby represents and warranties to Creditor as follows:
(1)
|
Guarantor
is an independent legal body, has all necessary capacities for rights,
and
is capable to perform its obligations under this Contract in its
own name
and independently undertake civil
liabilities.
|
(2)
|
Guarantor
has right to execute this Contract and has already fulfilled any
and all
licenses and authorizations required for executing this Contract
and
performing its obligations hereunder. The terms and conditions of
this
Contract represent Guarantor’s true intention and have legal binding force
upon Guarantor.
|
(3)
|
Guarantor
warranties to observe laws and disciplines. The execution and performance
of this Contract are not against laws (including laws, regulations,
rules,
local laws, and judicial interpretations), articles of incorporation,
relevant instruments of appropriate authorities, judgments, or awards
with
which Guarantor shall comply, nor are they in conflict with any contract
or agreement already signed by Guarantor or any other obligations
undertaking by Guarantor.
|
(4)
|
Guarantor
warranties that any and all the financial statements (if there’s any)
provided by Guarantor are in conformity to the laws of China (excluding
Hong Kong Special Administrative Region, Macau Special Administrative
Region, and Taiwan) and truly, completely and fairly reflect Guarantor’s
financial conditions, and that any and all the materials, documents
and
information involved herein are true, valid, correct and complete
with
nothing concealed.
|
(5)
|
Guarantor
warranties to go through all the filings, registrations and other
procedures required for the effectiveness of this Contract and the
lawful
implementation of this Contract and pay relevant taxes and
levies.
|
(6)
|
Since
the issuance of the latest audited financial report, no significant
adverse changes have happened to Guarantor’s operating or financial
conditions.
|
(7)
|
Guarantor
has already disclosed to Creditor any and all the facts and situations
that are known or should be known by Guarantor and that are important
for
Creditor in making decisions on whether to give the funds to Debtor
under
the Master Contract.
|
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
(8)
|
Guarantor
warranties that on the date of execution hereof and during the term
of
this Contract, Guarantor did not and will not fail to pay or delay
payments including but not limiting employees’ salaries, medical
insurance, injury subsidies, allowances and
compensations.
|
(9)
|
Guarantor
warranties that no such circumstances or events exist that cause
or might
cause material negative influences to Guarantor’s capacity to perform this
Contract.
|
Article
4 Covenanted Matters
1.
|
Guarantor’s
Warranties
|
(1)
|
Guarantor
warranties that Guarantor will not take any of the following actions
before obtaining Creditor’s written
consent:
|
a.
|
sell,
gift, lease, lend, transfer, mortgage, pledge or otherwise dispose,
partially or fully, its substantial
assets;
|
b.
|
materially
change its operating structure or organization, including but not
limiting
to contracting, lease, joint operation, corporate transformation,
stock
transformation, transfer of shares, combination (or merger), joint
venture
(or joint cooperative venture), split, establishing subsidiary, transfer
of property, and reduction of capital,
etc.
|
c.
|
modify
the company’s articles of incorporation or change the company’s scope of
business or main businesses.
|
d.
|
provide
guarantee for a third party, which materially and adversely influences
Guarantor’s financial conditions or its capacity to perform its
obligations under this Contract.
|
e.
|
apply
for reorganization, bankruptcy or
dissolution.
|
f.
|
execute
any contract/agreement that has substantial adverse influences on
Guarantor’s capacity to perform its obligations hereunder or undertake
relevant obligations that have such
influences.
|
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
(2)
|
Guarantor
warranties that upon the occurrence of the following events, Guarantor
will immediately notice Creditor of such event on the date of occurrence
and deliver to Creditor originals of relevant notices and documents
(subjecting to be stamped if they are issued by non-natural person,
or
signed if they are issued by natural person) within five (5) banking
days
thereafter:
|
a.
|
the
occurrence of such event(s) that causes Guarantor’s representations and
warranties made hereunder become untrue or
incorrect.
|
b.
|
Guarantor
or its controlling shareholder, actual controller or associated parties
are involved in action or arbitration, or its/their assets are detached,
sealed, frozen, mandatory executed, or otherwise subjecting to such
measures of equal force, or its/their legal representative, directors,
supervisors or officers are involved in action, arbitration or other
mandatory proceedings.
|
c.
|
Guarantor’s
legal representative or his/her authorized agent, directors, chief
financial officials, address, company name or office site, etc are
changed, or Guarantor changes its domicile or regular residence address,
or engages in employment with a new employer, or is absent in its
residence city for a long time, or changes his name, or experiences
unfavorable changes in his income
level.
|
d.
|
is
claimed by other creditors to reorganize or go bankruptcy, or dismissed
by
higher governing agency.
|
(3)
|
Guarantor
warranties that in the course of execution and performance of this
Contract, Guarantor will, at the request of Creditor, provide relevant
financial materials or income proofs to Creditor at any
time.
|
(4)
|
if
the Master Contract allows Creditor to issue letter of credit, performance
bond or standby letter of credit to Debtor, Guarantor warranties
that if
Debtor fails to supplement its security deposit (including earlier
supplement) as required by Creditor, Guarantor shall undertake joint
liability to supplement such deposit, which shall not exempt Guarantor
from any responsibility for guarantee hereunder, and any losses (including
loss of interests) caused thereby shall be borne solely by
Guarantor.
|
(5)
|
Guarantor
agrees that before Debtor fully satisfies its debts to Creditor under
the
Master Contract, Guarantor shall not exercise its right to recourse
and
other relevant rights hereunder against
Debtor.
|
(6)
|
if
Debtor has made earlier repayment, partially or fully, to Creditor,
or if
Debtor has repaid its individual debts to Creditor separately, Guarantor
shall continue to undertaking joint liability for guarantee Creditor’s
credit against Debtor accrued thereafter.
|
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
2.
|
Withhold
and Withdraw
|
(1)
|
If
Guarantor has due payable debt(s) or security deposit subjecting
to be
supplemented, Guarantor hereby authorizes Creditor to directly withhold
and withdraw such amount of money from any of its account opened
in
Shanghai Pudong Development Bank for satisfying the said payment
or
supplementing security deposit.
|
(2)
|
Unless
otherwise stipulated by national authorities, the order of repayment
of
the due debts with money withheld and withdrawn shall be arranged
as
follows: firstly such money should be used for repayment of service
charges due to Guarantor and Debtor, then for due interests, and
last for
due principal. If there is more than one debt due on the same date,
Creditor shall decide the order of repayment of such
debts.
|
(3)
|
If
the money withheld and withdrawn is not in the currency of debt required
to be repaid, Creditor shall have right to settle/buy foreign exchanges
with such money at such rate of exchange as determined by Creditor
at its
discretion and the risk associated with exchange rate shall be borne
by
Guarantor.
|
3.
|
Credit
Proof
|
The
valid
and effective proof of the credit guaranteed by Guarantor shall be such
accounting documents as kept and issued by Creditor in accordance with its
business procedures and rules.
4.
|
Notice
and Service thereof
|
(1)
|
Any
notice communicated by either Party to the other Party shall be sent
to
the address given on the signature page hereof until the other Party
changes its address by a written notice. Any notice sent to the said
address shall be deemed as served on the following date: if it is
sent by
registered mail, on the 7th
banking day after the mail is sent to the other Party’s principal business
address (in the case of corporate and its branches or other economic
organization) or domicile (in the case of natural person); if it
is
delivered in person, on the date the recipient receives the notice
as
confirmed by his/her signature; and if it is sent by fax or email,
on the
date such fax or email is sent. Notwithstanding the afore said provision,
any and all the notices, requirements or other correspondences sent
or
delivered to Creditor shall be deemed as served to Creditor only
when
Creditor actually receives them. In addition, if they are sent by
fax or
email, the originals thereof (subjecting to be stamped in the case
of
non-natural person, or signed in the case of natural person) must
be
delivered in person or sent by post thereafter to Creditor for
confirmation.
|
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
(2)
|
Guarantor
agrees that the subpoena and notice issued to Guarantor in any action
filed against Guarantor shall be deemed as served when it is sent
to the
address given on the signature page hereof. Any change of the said
address
shall not be valid unless such change is noticed to Creditor in written
form in advance.
|
5.
|
Validity,
Amendment and Cancellation
|
(1)
|
This
Contract shall enter into effect after it is stamped by Creditor
and
Guarantor and signed or stamped respectively by their legal
representative/director or authorized agent (if Guarantor is natural
person, signature alone is required) and terminate at the time when
the
credits guaranteed hereunder are fully satisfied.
|
(2)
|
The
validity of this Contract is independent from that of the Master
Contract.
This Contract shall not be nullified or cancelled along with the
nullification or cancellation of the Master Contract.
|
(3)
|
After
this Contract enters into effect, neither Party shall modify or earlier
terminate this Contract without the consent of the other Party. In
the
case that this Contract needs to be amended or cancelled, the Parties
hereto shall negotiate it and reach a written agreement thereon.
|
Article
5 Defaulting Event and Resolution
1. |
Defaulting
Event
|
Any
of
the following events shall constitute default of Guarantor against
Creditor:
(1)
|
any
representations, explanations or warranties made by Guarantor hereunder,
or any notices, authorizations, licenses, consents, certificates
and other
documents made in accordance with or in relating to this Contract
are
incorrect or misleading at the time they are made, or have proven
to be
incorrect or misleading, or invalid or nullified or have no legal
force.
|
(2)
|
Guarantor
breaches any provision of the Article 4
hereof.
|
(3)
|
Guarantor
is wound up, reorganized, liquidated, administered or in trust, dissolved,
unlicensed or deregistered, or bankrupted, or ceases its business
or
operation.
|
(4)
|
Guarantor
is dead or declared dead, if it is natural
person.
|
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
(5)
|
Guarantor
shifts or attempts to shift its assets away under the disguise of
conjugal
changes.
|
(6)
|
Guarantor
experiences deteriorating financial situation or operating difficulties,
or such other events that adversely influence Guarantor’s normal
operation, financial conditions or debt-serving
capacity.
|
(7)
|
Guarantor
or its controlling shareholder, actual controller or associated parties
are involved in significant action or arbitration, or its/their assets
are
detached, sealed, frozen, mandatory executed, or otherwise subjecting
to
such measures of equal force, or its/their legal representative,
directors, overseers or executive officers are involved in action,
arbitration or other mandatory proceedings which adversely influences
Guarantor’s debt-serving capacity.
|
(8)
|
Guarantor
otherwise acts against this Contract that prevents normal performance
hereof, or infringes upon Creditor’s righteous interests.
|
2. |
Resolution
|
In
the
event of any default described above, Creditor shall have right to claim for
earlier maturity or expiry of the principal credit and/or Crediting Period
and
require Guarantor to undertake its responsibility for guarantee or require
Debtor to supplement security deposit, and in addition, require Guarantor to
pay
damages (to be calculated in accordance with Article 7 hereof). If the damages
are insufficient to compensate for Creditor’s losses caused thereby, Guarantor
shall compensate for them.
Article
6 Other Provisions
1. |
Applicable
Law
|
This
Contract shall be governed by the laws of the People’s Republic of China
(excluding Hong Kong Special Administrative Region, Macau Special Administrative
Regio, and Taiwan).
2. |
Dispute
Resolution
|
Any
dispute in relating to this Contract shall be settled through friendly
negotiations. If negotiation fails, the court of the district in which Creditor
is located shall have nonexclusive jurisdiction over such dispute. During the
period of dispute, the Parties shall continue performing undisputed terms and
conditions hereof.
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
3. |
Miscellaneous
Matters
|
(1) |
Any
matter that is not specified herein and needs to be supplemented
may be
covenanted and written down by the Parties under Article 7 hereof,
or
otherwise specified in a written agreement to be attached hereto.
The
attachment(s) of this Contract constitute an inseparable part hereof
and
shall have equal legal force as this
Contract.
|
(2) |
Unless
otherwise specified in this Contract, relevant terms and expressions
used
herein shall bear the same meaning as they are used in the Master
Contract.
|
Article
7 Contractual Elements
1. |
Master
Contract Guaranteed Hereunder (corresponding to WHEREAS
hereof)
|
(1) |
Master
Contract refers to the Agreement
on Line of Credit numbered
79142007280056
executed by Creditor and Debtor on September
18, 2007,
or contracts signed by Creditor and Debtor on continuous basis between
September
7, 2007 and
_________.
Creditor hereunder refers to Shanghai
Pudong Development Bank - Shenzhen Branch as
named in the Master Contract.
|
(2) |
Debtor
under the Master Contract is Shenzhen Highpower Technology Company
Limited., located in Shenzhen
.
|
2. |
Principal
Credit Guaranteed Hereunder (Corresponding to Article 1
hereof)
|
The
principal credit guaranteed hereunder shall be the credit of one or more types
granted by Creditor to Debtor on continuous basis under the Master Contract
between September
7, 2007 and
September
7, 2008
(“Crediting Period”), including but not limiting to various loans and debts
accrued by provision of bank
acceptance bills (name
of
intermediary business). The balance of the said principal credit shall not
exceed maximum twenty-eight
million, five hundred and seventy thousand (in
words) RMB
(currency)
during the Crediting Period. If the principal credit is granted in other
currency, it shall be converted into RMB at such rate as determined by Creditor
at its discretion.
3. |
Settlement
of Default (Corresponding to Article 5.2
hereof)
|
Damages:
equal to one
percent (in
words) of the principal credit.
4. |
The
attachment(s) of this Contract shall include: (corresponding to Article
6.3.(1) hereof)
|
5. |
Other
Matters agreed by the Parties (corresponding to Article 6.3(1)
hereof)
|
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
6. |
This
Contract shall have 4
originals,
1
is
held by Guarantor and 2
held
by Creditor, which shall have equal legal force.
|
(The
rest
part of this Page is intentionally left blank.)
(This
page is for signature only.)
In
witness whereof, this Contract has been duly executed by the undersigned
Guarantor and Creditor on September
18, 2007
where
the Parties have carefully discussed and explained all the terms and conditions
contained herein and have no doubts about them. Both Parties can correctly
understand the legal meaning of their rights and obligations and restrictions
or
exemption on/of their responsibilities.
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
Guarantor
(Stamp) Creditor
(Stamp)
Legal Representative or Authorized
Agent
(Stamp or signature)
|
Director or Authorized Agent
(Stamp or signature)
|
(Applicable to Legal Person) |
/s/ Pan Dangyu | |||
Guarantor
(Signature)
|
|||
Valid Type of Identity Certificate and
Number:
(Applicable to Natural Person) |
Address: | Business Address: |
Postal Code:
Tel:
Fax:
Email:
Contact person:
|
Postal Code:
Tel:
Fax:
Email:
Contact person:
|
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Shanghai
Pudong Development Bank Maximum
Loan
Guarantee Contract
Format
of
Letter of Warranty issued by Guarantor’s spouse for consent to dispose shared
properties (applicable if Guarantor is natural person)
Attachment:
Letter
of Warranty on Consent to Execution of Properties Shared with My
Husband
No.:
To:
Shanghai Pudong Development Bank - Shenzhen Branch
I,
Xxx
Xxxx-Xxx
(ID Card
No.),
as
Guarantor Pan
Xxxx-Xx’x
legal
spouse, hereby warranty as follows for the execution and performance of the
Contract for Guarantee of Maximum Line of Credit (numbered: ZB7914200728056):
I
am
fully informed of the said Contract signed by Pan
Xxxx-Xx.
I agree
on the execution and performance of the Contract and I acknowledge that Creditor
has right to dispose the properties shared with my spouse when Guarantor is
subject to undertake the responsibility for guarantee in accordance with the
Contract.
/s/ Xxx Xxxx-Xxx | |||
September 8, 2007 |
|||
Annex:
1.
Copy
of my ID Card.
2.
Copy
of my Marriage Certificate.
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