Maximum Guarantee Agreement
Exhibit
10.86
Code
of the Agreement:
Guarantor (Party A): Henan Shuncheng Group Coal Coke Co.
Ltd.
Address:
South Industry Road, Tongye Town, Anyang County, Henan Province. Postal
Code:
Legal
Representative/Responsible Person: Wang Xinshun
Fax: Tel:
Creditor
(Party B): Anyang Branch, Construction Bank of China
Address: Postal
Code:
Legal
Representative/Responsible Person:
Fax: Tel:
WHEREAS
Party B
has continuously granted the Option 5 credit of
the following credits to Anyang Yuxin Active Lime Co., Ltd (hereinafter referred
to as the “Debtor”) and will sign and/or has signed agreement of loan in RMB,
agreement of loan in foreign currency, bank acceptance agreement, agreement of
issuing L/C, agreement of issuing Letter of Guarantee and/or other legal
documents with the Debtor from to (hereinafter
referred to as the “Term for Determining the Creditor's Rights”). All the
agreements, agreements and/or other legal documents mentioned hereinabove signed
during the Term for Determining the Creditor's Rights are hereinafter referred
to as “the Principal Agreement”.
Option
1 Releasing loan in RMB or Foreign
Currency;
Option
2 Acceptance of Commercial Draft;
Option
3 Issuing L/C;
Option
4 Issuing Letter of Guarantee;
Option
5 Other mode of granting credit: domestic
guarantee;
Party A
voluntarily assumes the maximum guarantee liability for the loans of the Debtor
under the Principal Agreement (specified hereinabove).
The
parties have reached a consensus to conclude this agreement in accordance
with relevant laws and regulations and will commit themselves to the terms and
conditions as stipulated hereunder.
Article
1 Scope
of Guarantee and the Maximum Amount
1.1 The
guarantee covers all debts under the Principal Agreement, including but not
limited to loan principal, interest (including default interest and compound
interest), liquidated damages, compensation, other expenses that shall be repaid
to Party B by the Debtor (including but not limited to the procedure fee,
telecommunication charges, incidentals and the banking charges relevant to the
L/C the Beneficiary reluctant to assume prepaid by Party B), and the expenses
attributable to the exercise of guarantee rights and the Creditor’s rights by
Party B (including but not limited to litigation fee, arbitration fee, charges
for preservation of property, travel expenses, enforcement fee, evaluation fees,
charges for auction of property, notarization fees, expenses for service,
announcement fee and attorney fee).
1.2 The
Maximum Amount guaranteed by this Agreement is RMB 10,000,000 (TEN MILLION YUAN)
and shall be decreased correspondingly with the amount that already paid due to
that Party A fulfills its guarantee obligation pursuant to this
Agreement.
1.3 The
scope of guarantee shall remain available to the loans, advances, interest,
expenses or any other Creditor’s rights of Party B, notwithstanding the time
when the loans, advances, interest, expenses or rights actually incur or rise is
not in the Term for Determining the Creditor’s Rights. The expiry date of the
term for performance of the debts under the Principal Agreement shall not
subject to the expiry date of the Term for Determining the Creditor’s
Rights.
Article
2 Mode
of Guarantee
The
guarantee mode hereof is guarantee with joint and several
liabilities.
Article
3 Guarantee
Period
3.1 Guarantee
period of the Agreement is calculated by giving creditor of the debtor in one
sum, that is , from the date of signature of the principal agreement of giving
credit to two year after the maturity date of debt under the Agreement and is
two years after the maturity date of each debt.
3.2 The
Guarantee Period shall be two years as of the expiry date provided in the
extension agreement if an extension agreement is reached regarding debt of the
Principal Agreement between the Debtor and the Creditor. The Guarantor’s joint
and several liabilities for the debts shall remain in force in the extended
period without the Guarantor’s prior content.
3.3 The
Guarantee Period shall be two years as of the early maturity date of the debts
in case Party B announces the early maturity according to the laws and
regulations or the Principal Agreement.
Article
4 Independence
of the Guarantee Agreement
This
Agreement is independent of the Principal Agreement in the
validity, in other words, the validity of this Agreement will not be affected in
the events that the Principal Agreement is not
established or established without effectiveness, or the Principal Agreement is
invalid in whole or in part, or the Principal Agreement is cancelled
or terminated. Party A shall assume the joint and several liabilities for the
debts incurred in the return of property or arising out of the reimbursement of
the loss if it has been confirmed that the Principal Agreement is not
established or established without effectiveness, or the Principal
Agreement is invalid in
whole or in part, or the Principal Agreement is cancelled or terminated.
Article
5 Alteration
of the Principal Agreement
5.1 Party
A hereby agrees to assume the guarantee liability on the Maximum Amount stated
in this Agreement in the Scope of Guarantee defined in the Agreement in case of
any alteration agreed by to the Principal Agreement (including but not limited
to any extension of loan term or any increase of the amount of the loan
principal) and any consensus reached between Party B and the Debtor in the
Principal Agreement, without the notification of such alternation and consensus
in such case.
5.2 The
guarantee liability of Party A shall not be relieved in case of any one of the
following circumstances:
|
5.2.1
|
the
restructuring, consolidation, merger, division, increase & decrease of
the registered capital, joint venture, consortium and change of name of
Party B or the Debtor;
|
|
5.2.2
|
Party
B entrusts its obligations under the Principal Agreement to the third
party.
|
|
5.2.3
|
the
guarantee under this Agreement is to be transferred with the transfer of
the Creditor’s rights under the Principal
Agreement.
|
|
5.2.4
|
Party
A shall assume the joint and several liabilities in accordance with the
Agreement notwithstanding the transfer of the Creditor’s rights or the
debts under the Principal Agreement has not yet taken effect, or is
invalid or such transfer is cancelled or
terminated.
|
Article
6 Guarantee
Liability
6.1 Party
A shall assume the guarantee liability in the scope of guarantee in case of the
maturity of the debt under the Principal Agreement or the infringement of the
provisions of the Principal Agreement by the Debtor, or in case that the Debtor
fails to repay the debt in due time and in full when Party B announces the early
maturity of the debts under the Principal Agreement according to the terms and
conditions of the Principal Agreement or the relevant laws and
regulations.
Party A
shall pay the liquidated damage 0.05% of the overdue amount on a daily basis
from the date of expiry to the date when Party A pays up the payable amounts in
case that Party A fails to pay the due amounts in full in the term required by
Party B. The maximum liability stated in this Agreement shall not be the upper
limit of the sum of the guarantee liability Party A assumes and the liquidated
damage mentioned hereinabove in this case.
6.2 No
matter whether Party B has other surety for the Creditor’s rights under the
Principal Agreement (including but not limited to guarantee, mortgage, pledge,
Letter of Guarantee and Standby L/C), whether the surety mentioned hereinabove
has established, and/or whether the surety has taken effect, and/or whether
Party B has claimed its rights against other guarantors, and/or whether the
third party agrees to assume the debt in part or in whole under the Principal
Agreement, and/or whether the above-mentioned surety is provided by the Debtor
itself, the guarantee liability Party A shall undertake under this Agreement
shall not be relieved and Party B can directly ask Party A to assume its
guarantee liability in the scope of guarantee in accordance with the Agreement,
free of any objection from Party A.
6.3 Party
A shall hold harmless Party B from and against any damages or losses related to
or arising out of the claim of right of subrogation or right of recourse by
Party A if the debt under the Principal Agreement can not get a full settlement
even after Party A performed its guarantee liability since the maximum guarantee
liability defined in this Agreement is less than the amount of the actual debt
balance under the Principal Agreement. In addition, Party A agrees that the
repayment of the debts under the Principal Agreement shall have priority over
the exercise of the right of subrogation or right of recourse.
In other
words, prior to the full settlement of the debts of Party B:
|
6.3.1
|
Party
A agrees not to claim right of subrogation or right of recourse against
the Debtor or other guarantors. Party A shall apply the amounts it
acquires in case that Party A somehow performs the rights mentioned
hereinabove first in the settlement of the outstanding
debt.
|
|
6.3.2
|
Party
A agrees not to claim its rights on the collateral or the amounts it
receives after the disposition of the collateral as a result of its right
of subrogation or any other reasons in case that guarantee in rem is also
attached to the debt under the Principal Agreement, and in this case the
collateral and the amounts mentioned hereinabove will be used to repay the
debt balance first;
|
|
6.3.3
|
The
amounts Party A receives due to the counter guarantee which the Debtor or
other guarantors may provide to Party A shall be first used in the
settlement of the overdue debt of Party
B.
|
6.4 Party
A shall have a full understanding of Interest Rate Risk (IRR), on this account
Party A shall assume the joint and several liabilities on the increased
interest, default interest and compound interest as a result of the adjustment
of interest rate and the change of the method for calculating or settling the
interest made by Party B in accordance with the provisions of the Principal
Agreement or in response to the change of national interest policy.
6.5 Party
B is entitled to deduct the amounts in RMB or in other currencies from the
accounts the Debtor opens in Construction Bank of China’s business system for
the settlement of any one due debt in case that the Debtor is indebted to Party
B besides the debts under the Principal Agreement, and the deduction will not
constitute any relief to the guarantee liability of Party A.
Article
7 Other
Obligations of Party A
7.1 Party
A is responsible for the supervision of the employment of the loan (including
the use of the loan). Party A shall accept the supervision made by Party B on
its capital, property and business condition and submit relevant information,
documents or materials such as the financial statement as required by Party B
and shall promise all documents and materials submitted to Party B are accurate,
real, complete and valid. Party A shall not provide the guarantee beyond its
guarantee capability to the third party without the prior written consent of
Party B;
7.2 In
case of the following circumstances: contracting, taking-over,
leasing, shareholding system reform, decrease of registered capital,
investment, consortium, consolidation, merger, acquisition and reconstruction,
division, joint venture with foreign investment (or cooperation), applying for
or being applied for restructuring, applying for dissolution, being revoked,
applying for or being applied for bankruptcy, change of controlling shareholders
or actual controller or transfer of significant asset, being
shut-down, being imposed on huge amount of penalty by relevant
authorities, revocation of Business License, cancellation of
registration, being involved in big legal disputes, deteriorating financial
situation, or experiencing serious difficulties in its production and
operations, inability of legal representatives or major responsible person to
perform responsibilities, or incapacitation of legal representatives or major
responsible person to assume the guarantee liability, Party A shall notify Party
B in a timely manner and be responsible for the commitment, transfer or
succession of the guarantee liability under the Agreement as required by Party B
or providing new guarantee accepted by Party B for the performance of the
Principal Agreement.
7.3 In
case of change of business registration items such as name, legal representative
or responsible person, domicile, scope of business, registered capital or
articles of association, Party A shall give Party B a written notification with
relevant materials attached thereto in three business days after the
change.
Article
8 Other
Clauses
8.1 the
deduction of payables
Party B
is entitled to deduct the payable amounts in RMB or other currencies owed by
Party A under this Agreement from the accounts Party A opens in the business
system of Construction Bank of China, without prior notification to Party A.
Party A shall assist Party B in handling the procedures of settlement and sale
of foreign exchange or procedures of foreign exchange trading if any and shall
bear the exchange rate risk.
8.2 Use
of Party A’s Information
Party A
allows Party B to make inquiries on the credit standing of Party A in relevant
authorities or organizations or in the credit database approved by People’s Bank
of China and the institutions in charge of credit rating and credit information
collection, and also authorizes Party B to provide the credit information of
Party A to the credit database approved by People’s Bank of China and the
institutions in charge of credit rating and credit information collection. Party
A hereby agrees that Party B has the right to use and disclose the information
of Party A in a proper manner for business necessity.
8.3 Loan
Collection by Announcement
Party B
has the right to inform the relevant authorities or organizations of the
infringement by Party A and collect the loan by issuing a public notice through
the news media.
8.4 Evidentiary
Effect of Party B’s Record
In the
absence of reliable and conclusive evidence to the contrary, Party B’s
accounting record of loan principal, interest, expenses and repayment history,
the documents and voucher prepared or preserved by Party B verifying the
drawing, repayment and payment of interest by the Debtor and the record or
voucher of loan collection by Party B shall be the effective and conclusive
evidence of the debt under the Principal Agreement. Unilateral preparation or
preservation of the record, data, documents and voucher by Party B shall not be
a ground for Party A to raise its objection in this case.
8.5 Retention
of Rights
The
rights Party B enjoys under this Agreement shall not affect and deny other
rights accessible to Party B in accordance with laws, regulations and other
agreements. Any tolerance, extension, preferential measure or delay in
performing any right under this Agreement shall not be deemed as waiver of the
rights and interests under the Agreement nor be considered as permission or
approval of any infringement of this Agreement and shall neither affect,
preclude and hinder any further exercise thereof or other rights by Party B nor
impose any liability or obligation on Party B.
The
guarantee liability Party A shall assume under this Agreement shall not be
relieved in case Party B refuses to exercise or delays the exercise of any right
under the Principal Agreement or Party B has not exhausted the remedies of the
Principal Agreement. Nevertheless the guarantee liability of Party A will be
relieved correspondingly in case of the debt relief made by Party
B.
8.6 Dissolution
or Bankruptcy of the Debtor
Party A
shall notify Party B of reporting claims upon being informed that the Debtor has
filed or been filed for dissolution or bankruptcy proceedings and shall
participate in the bankruptcy proceedings in a timely manner for the beforehand
exercise of right of recourse. In case Party A fails to exercise the right of
recourse in advance after it knows or should know the dissolution or bankruptcy
proceedings of the Debtor, Party A shall bear the losses thereof if
any.
Notwithstanding
the provisions of Clause 5.2 of the Section, in case of a compromise agreement
or reorganization plan reached between Party B and the Debtor during the
bankruptcy proceedings, the rights Party B enjoys under this Agreement will not
be damaged due to the compromise agreement or reorganization plan, nor will the
guarantee liability of Party A be relieved. Party A shall not defend against the
claim of rights raised by Party B with the provisions of the compromise
agreement or reorganization plan. Party B retains the right to ask Party A to
pay off the outstanding debt arising from the concession made by Party B to the
Debtor in the compromise agreement or reorganization plan.
8.7 Dissolution
or Bankruptcy of Party A
In case
Party A has filed or been filed for dissolution or bankruptcy, Party B is
entitled to participate in the liquidation or bankruptcy proceedings and report
claims notwithstanding the debt under the Principal Agreement has not yet
matured.
8.8 Party
A shall promptly notify Party B in writing of the change in case of Party A
changes the postal address or contact information. Any losses caused by delayed
notifying shall be borne by Party A.
8.9 Settlement
of Disputes
All
disputes and argues arising from the performance of this agreement shall be
solved through negotiation by the parties; if negotiation fails, the parties
agree to adopt the Option One of the
following settlement of disputes:
Option 1
Submit the disputes to the court at the domicile of Party B;
Option 2
Submit the disputes to__________Board of
Arbitration in accordance with its arbitration rules effective at the time of
application. Place of Arbitration__________ The award of the arbitration
shall be final and binding upon both parties.
During
the lawsuit or arbitration, other provisions in the agreement that may not
be affected shall be performed continuously.
8.10 Executing
the Agreement
The
agreement shall be effective as of the date of signing by legal representatives
or authorized representatives of the Parties and sealed by the
Parties.
8.11 The
Agreement shall be in duplicate.
8.12 Other
Provisions
|
No.
|
Article
9 Statement
& Commitment of Party A
9.1 Party
A is fully aware of the business scope and scope of authority;
9.2 Party
A has read all clauses of the Agreement and the Principal Agreement and Party B
has provided explanation to the clauses as required by Party A. Party A hereto
has accurate and correct understanding of the terms and conditions of this
Agreement and the Principal Agreement and the legal consequences.
9.3 Party
A is legally qualified to be a guarantor and Party A provides the guarantee
pursuant to the laws, regulations, rules and the provisions of Party A’s
articles of association or corporate document and with the approval of
managements and/or authorities. All losses caused by Party A’s unauthorized
signing of the Agreement shall be borne by Party A, including but not limited to
compensating the losses Party B suffers in full.
9.4 Party
A hereby confirms that it has a full understanding of the asset, debt, business,
credit standing and creditworthiness of the Debtor, the capacity and authority
for the Debtor to execute the Principal Agreement and the terms and conditions
of the Principal Agreement.
(No
clauses in the signature page)
Party
A:
Common
Seal:
Legal
Representative or
Authorized
representative: /s/ Wang Xinshun
Party
B:
Common
Seal:
Legal
Representative or
Authorized
representative
(signature): [illegible]
Dated
5th
Jan. 2010
