Loan Agreement Agreement #32101200800013640 The Borrower: Danyang Lihua Electron Co., Ltd The Lender: Agricultural Bank of China Danyang City Branch Pursuant to the relevant laws and regulations, after negotiating, the parties hereby agree as follows:
Exhibit
10.13
Agreement
#32101200800013640
The
Borrower: Danyang Lihua Electron Co., Ltd
The
Lender: Agricultural Bank of China Danyang City Branch
Pursuant
to the relevant laws and regulations, after negotiating, the parties hereby
agree as follows:
Article
1
Facility
1.
Type:
General liquid capital
2.
Purpose: Purchase of Copper
Clad Aluminum
3.
Currency and Amount: RMB Five Million and Two Hundred Thousand (RMB
5,200,000)
4.
Maturity:
(1)
Refer
to the chart below:
|
Launch
|
Maturity
|
||||||
|
Year
|
Month
|
Day
|
Amount
|
Year
|
Month
|
Day
|
Amount
|
|
2008
|
4
|
16
|
Five
Million and Two Hundred Thousand
|
2009
|
4
|
15
|
Five
Million and Two Hundred Thousand
|
(The
appendix for more items could not show herein shall constitute a part of this
agreement.)
(2)
Any
inconsistence with regard to the amount, launch date and maturity date between
hereunder and the borrowing certificate, the borrowing certificate shall
control. The borrowing certificate shall constitute a part of the agreement
and
shall have same legal effects.
(3)
If
the facility hereunder is a foreign exchange loan, the Borrower shall repay
the
principal and the accrued interest in the original currency.
5.
Interest Rate
The
RMB
borrowing interest rate shall be in accordance with the first method specified
below:
(1)
Floating Rate
The
borrowing interest rate is the benchmark interest rate to upwardly float thirty
percent (30%), exercised yearly interest rate is nine point seven hundred eleven
percent (9.711%). For the borrowing term is five and less than five years,
the
benchmark interest rate is the RMB borrowing benchmark interest rate on the
same
term announced by the People’s Bank of China (hereinafter the “PBC”); the
benchmark interest rate for the borrowing term is five or more than five year
is
the RMB borrowing benchmark interest rate on the same term announced by the
PBC.
The
adjustment period for the interest rate is one month. If the PBC adjusts RMB
borrowing benchmark interest rate, starting form the matching borrowing date
in
the first month of the next adjustment period, the Lender will adjust the
borrowing interest rate accordingly and re-calculate a new exercised interest
rate, and shall not need to notify the Borrower the adjustment. If the
adjustment date for benchmark interest rate and the launch date or the matching
borrowing date in the first month are the same day, starting from the adjustment
date of the benchmark interest rate to re-calculate the exercised interest
rate;
in the case no matching borrowing date, the last day of the aforesaid month
is
deemed to be the matching borrowing date.
(2)
Fixed
Rate (N/A)
The
borrowing interest rate is the benchmark interest rate to (upwardly/ downwardly)
float percent
(%), exercised yearly interest rate is percent
(%). For the borrowing term is five and less than five years, the benchmark
interest rate is the RMB borrowing benchmark interest rate on the same term
announced by the PBC; for the borrowing term is five or more than five year,
the
benchmark interest rate is the RMB borrowing benchmark interest rate on the
same
term announced by the PBC plus percent.
The
interest rate for the foreign exchange loan is calculated by
the method:
(1)Interest
margin of month LIBOR/HIBOR+ %
on the
monthly floating basis. LIBOR/HIBOR is the London Interbank Offer Rate / Hong
Kong Interbank Offer Rate on the date of two business days before the interest
calculation date announced by the Reuters
(2)Exercised
yearly interest rate is %
till
maturity of the facility.
(3)Other
methods .
6.
Settlement of the Interest
The
facility hereunder is settled on the monthly basis. The interest settlement
date
is the 20th
day of
each month. The Borrower shall pay the interest on every interest settlement
date. If the last repayment date for the principal is not on the interest
settlement date, the unpaid interest shall be repaid together with the principal
(the daily interest equals to the monthly interest/30)
Article
2
In
the
case the following conditions are not fulfilled, the Lender may not provide
the
facility hereunder:
1.
The
Borrower shall open the general account at the Lender.
2.
The
Borrower shall provide the relevant documents and information as the Lender
requests and complete the relevant procedures.
3.
In the
event the facility hereunder is a foreign exchange loan, the Borrower shall
complete the relevant permissions, registrations and other procedures as
required in accordance with laws and regulations.
4.
If the
facility hereunder is secured by pledged collaterals or mortgages, the relevant
legal procedures including but not limited to registrations and/ or insurances
have been completed as the Lender requests. The aforesaid secured interests
and
insurances shall be continuously valid and effective. In the event the facility
is guarantee by the guarantors, the guarantee agreements shall be signed and
become effective.
Article
3
The Lender’s Rights and Obligations
1.
The
Lender is entitled to inquire the Borrower’s production, financial condition,
inventory and the application of the facility funds; the Lender may request
the
borrower periodically to provide the materials such as related financial and
accounting reports.
2.
In the
event Item 7, 8,and 10 of the Article 4 occur or the Borrower engages in other
actions or conditions adversely affect the repayment of the facility, the Lender
may withhold funding, call the facility, or terminate the
agreement.
3.
In the
event the Lender calls the facility pursuant to the clause of the agreement
or
requests the Borrower to prepay the principal, the accrued interest, the
punitive interest, the compound interest and other expenses, the Lender may
directly withdraw the aforesaid payments from the Borrower’s
account.
4.
In the
event the Borrower’s payment is inadequate to repay the amount owed under the
agreement, the Lender may decide any of the principal, the accrued interest,
the
punitive interest, the compound interest and other expenses shall be repaid
first.
5.
In the
event the Borrower breaches its repayment obligations under the agreement,
the
Lender may disclose the breach to the public.
6.
The
lender shall launch the full amount of the facility to the Borrower on schedule
in accordance with the agreement.
Article
4
The Borrower’s Rights and Obligations
1.
The
Borrower is entitled to draw down the facility and use the facility funds in
accordance with the agreement.
2.
The
Borrower shall conduct the settlement and deposit related to the facility
hereunder through the account set forth in the Article 2.
3.
In the
event the facility hereunder is a foreign exchange loan, the Borrower shall
complete the relevant permissions, registrations and other procedures as
required in accordance with laws and regulations.
4.
The
Borrower shall repay the principal and the accrued interest in accordance with
the agreement. In the case the Borrower needs to roll over the facility, it
shall submit a written application within fifteen days before the maturity
of
the facility; after the Lender consents, the rollover agreement shall be signed
by and between the parties.
5.
The
Borrower shall use the facility funds in compliance with the purpose hereunder,
and shall not appropriate or misappropriate the facility funds.
6.
The
Borrower shall provide the authentic, integrated and valid financial report
or
other relevant information on monthly basis, and actively cooperate with the
Lender’s inspection with regard to its production, business operation, financial
condition and its compliance with the purpose hereunder
7.
In the
event the Borrower carries out outsource, lease, conversion to share-holding
system, co-operating business, merger, acquisition, split, joint venture, asset
transfer, reforming application, bankruptcy application or other actions could
change the debtor and creditor relationship or affect the Lender’s rights and
interests hereunder, it should send the written notice to the Lender before
carrying out the aforesaid actions. Without the Lender’s consent and perform the
repayment obligations or prepay the unpaid loans, the Borrower shall not carry
out the aforementioned actions.
8.
In the
event the Borrower engages in any other actions not specified in Article 4.7
and
have material adverse effects to its repayment obligations hereunder, for
example, the Borrower ceases productions, suspends business, deregisters
, is
revoked business license; or the legal representatives or the major responsible
persons engage in illegal activities, involve in major lawsuits or arbitrations;
its productions and business operations encounter severe difficulties; or the
financial conditions worsen, the Borrower shall send written notice to the
Lender immediately, and provide the acceptable collaterals to secure the
facility.
0.Xx
the
event the Borrower provides guarantees to the third parties, or provides its
material assets to the third parties as collaterals, and may affect its
repayment abilities, the Borrower shall send the prior written notice to the
Lender and request its consent.
10.
The
Borrower and its investors shall not withdraw funds, transfer assets or assign
shares to avoid its obligations to the Lender.
11.
The
Borrower shall immediately send the written notice to the Lender in the event
of
change in its name, legal representatives, business address, business scope,
and
other business registration items.
12.
In
the event the guarantor hereunder ceases productions, suspends business,
deregisters
, is
revoked business license, bankrupts and has loss in business; partially or
totally incapable to provide guarantee for the facility hereunder, or the values
of pledged or mortgaged collaterals or secured interests are impaired, the
Borrower shall immediately provide other acceptable collaterals or secured
interests to the Lender.
13.
The
Borrower shall assume all relevant expenses, including but not limited to legal
service, insurance, transportation, appraisal, registration and notary
fees.
Article
5
Prepayment
The
Borrower shall obtain the Lender’s prior consent to prepay the loan. In the
event the Lender agrees the Borrower to prepay the loan, the prepayment interest
shall be calculated by the second method:
1.
By the
agreed borrowing term and exercised borrowing interest set forth in the
agreement.
2.
By the
actual borrowing term and the agreed exercised borrowing interest upwardly
floating zero percent (0%).
Article
6
Breach
1.
In the
event the Lender is not in compliance with the agreement to launch the facility
in the agreed amount and the schedule and cause the Borrower’s loss, the Lender
shall pay the penalty calculated by the default amount and the deferral days.
The calculation of the penalty is the same calculation method as the deferral
repayment interest in the same term.
2.
In the
event the Borrower is not in compliance with the agreement to repay the
principal, the Borrower shall pay the Lender the punitive interest from the
deferral date to the repayment date on the interest rate calculated on the
basis
that the agreed exercised interest rate upwardly floating one point fifty
percent (1.50%). During the period of deferral, if the facility currency is
RMB
and the PBC upwardly adjusts its benchmark interest rate, the punitive interest
rate shall be adjusted accordingly from the adjustment date.
3.
In the
event the Borrower is not in compliance with the purpose hereunder, the Borrower
shall pay the Lender the punitive interest against the breach amount from the
breach date to the repayment date on the interest rate calculated on the basis
that the agreed exercised interest rate upwardly floating one hundred percent
(100%). During the period, if the facility currency is RMB and the PBC upwardly
adjusts its benchmark interest rate, the punitive interest rate shall be
adjusted accordingly from the adjustment date.
4.
To the
unpaid accrued interest, in accordance with the relevant regulations of PBC,
the
Lender may calculated the punitive interest as the compound interest. The unpaid
accrued interest includes the unpaid accrued interest during the period of
the
facility (including the punitive interest against the purpose )and the unpaid
accrued interest occurs after the deferral of repayment (including the punitive
interest for deferral and against the purpose). To the punitive interest for
the
unpaid accrued interest occurs during the period of the facility, the compound
interest rate shall be calculated by the agreed exercised interest rate
hereunder; after the maturity of the facility, the compound interest rate shall
be calculated by the deferral interest rate; the unpaid accrued interest for
deferral repayment shall be calculated by the deferral interest
rate.
5
In the
event the Borrower is not in compliance with the obligations hereunder, the
Lender is entitled to request the Borrower to amend the breach, to cease the
launch of the facility, to request the Borrower to prepay the launched
borrowings, to declare the other facilities under other agreements by and
between the Borrower and the Lender are matured or to adopt other actions to
secure the Lender’s assets.
6.
In the
event any guarantor under the agreement is not in compliance with the guarantee
agreement, the Lender is entitled to request the Borrower to amend the breach,
to cease the launch of the facility, to request the Borrower to prepay the
launched borrowings or to adopt other actions to secure the Lender’s
assets.
7.
In the
event the Lender files law suits or arbitrations to fulfill its interests
hereunder, the Borrower shall assume the legal, travel and other related
expenses the Lender may occur.
Article
7
Guarantee
The
guarantee for this agreement is the maximum guarantee. The guarantee agreement
shall be signed separately. The guarantee agreement number is
32905200700002755.
Article
8
Dispute Resolution
Any
dispute arising out of or related to this Agreement may be negotiated by the
parties, or be solved by the following method 1
:
1.
Submitted to and tried by the court, in which the Lender resides.
2.
Solved
via Arbitration
During
the period of conducting law suits or arbitrations, the clauses not under
disputes are still valid, effective and binding to the parties.
Article
9
Other Covenants
1.
The
Lender’s rights and interests hereunder shall be secured together by the maximum
guarantee agreement No. 32905200700002755 and 32110313901200806.
Article
10 Effectiveness of the agreement
The
agreement becomes effective on the date the parties sign or seal the
agreement.
Article
11
This
agreement is to be written up in three original copies with the Borrower, the
Lender and the Guarantor shall each hold one original copy, which shall have
same legal effects.
Article
12 Acknowledge
The
Lender has urged the Borrower to thoroughly and accurately understand each
clause set forth in the agreement, and has explain each clause to the Borrower.
Both parties have reach consensus to the agreement.
The
Borrower: Danyang Lihua Electron Co., Ltd
Legal
Representative (or authorized person)
The
Lender: Agricultural Bank of China Danyang City Branch
Legal
Representative (or authorized person)
Date:
April 16, 2008
Appendix:
Borrowing
Certificate
The
Borrower: Danyang Lihua Electron Co., Ltd
Type:
General liquid capital
Purpose:
Purchase of Copper
Clad Aluminum
Loan
Agreement No. 32101200800013640
Guarantee
Agreement No. 32905200700002755 and 32110313901200806
Launch
Date: 2008/4/16
Maturity
Date: 2009/4/15
Deposit
Account No. 10322901040004897
Amount:
RMB Five Million and Two Hundred Thousand (RMB 5,200,000)
Interest
Rate: 9.711%
