EXHIBIT 10.22
DATED AS OF NOVEMBER 1, 1997
(1) DURABLE ELECTRONICS INDUSTRIES LIMITED
(AS COMPANY)
AND
(2) DURABLE ELECTRICAL METAL FACTORY LIMITED
(AS CHARGEE)
--------------------------------
CHARGE
--------------------------------
CONTENTS
CLAUSE HEADING PAGE
1. INTERPRETATION..................................................1
2. CHARGE AND ASSIGNMENT...........................................3
3. PERFECTION OF SECURITY AND FURTHER ASSURANCE....................4
4. REPRESENTATIONS BY THE COMPANY..................................4
5. OBLIGATIONS OF THE COMPANY......................................5
6. EVENTS OF DEFAULT...............................................7
7. ENFORCEMENT.....................................................7
8. CHARGEE'S ADDITIONAL POWERS AND RIGHTS.........................14
9. APPLICATION OF RECEIPTS........................................14
10. INDEMNITY......................................................15
11. APPLICABLE RATE OF EXCHANGE....................................15
12. COSTS AND EXPENSES.............................................15
13. GENERAL........................................................16
14. NOTICES........................................................17
15. GOVERNING LAW..................................................18
Schedule The Assets.....................................................20
THIS CHARGE is made as of the 1st day of November 1997.
BETWEEN:
(1) DURABLE ELECTRONICS INDUSTRIES LIMITED (the "COMPANY"), a company duly
incorporated under the laws of Hong Kong (Company No.: 35273) whose
registered office is at 1st Floor, Efficiency House, 35 Xxx Xxx Xxxxxx,
Xxx Xx Xxxx, Xxxxxxx, Xxxx Xxxx; and
(2) DURABLE ELECTRICAL METAL FACTORY LIMITED (the "CHARGEE") whose
registered office is at 1st Floor, Efficiency House, 35 Xxx Xxx Street,
San Po Kong, Kowloon, Hong Kong.
WHEREAS:
(A) Pursuant to a working capital loan agreement and a US$6,219,512 loan
agreement both dated as of 1 November 1997 (collectively the
"AGREEMENTS", which expression shall include such Agreements as may
from time to time be supplemented, amended, modified or replaced, and
"AGREEMENT" shall mean either of them) and made between the Company, as
borrower, the Chargee, as lender, and New M-Tech Corporation, as
guarantor, the Chargee agreed to provide certain loan facilities to the
Company upon the terms and conditions therein mentioned.
(B) The Company has undertaken with the Chargee under each of the
Agreements that the Company execute this Charge, and this Charge is
accordingly supplemental to each of the Agreements.
NOW THIS DEED WITNESSES as follows:
1. INTERPRETATION
1.1 Except as otherwise defined or redefined herein or the context
otherwise requires, all expressions defined in the Agreements shall
have the same meanings in this Charge.
1.2 In this Charge the following words and expressions shall have the
following meanings:
"CHARGED ASSETS": the property and assets charged under this Charge in
favour of the Chargee and all other property and assets which at any
time are or are required to be charged in favour of the Chargee under
this Charge;
1.
"ENCUMBRANCE": any mortgage, charge, pledge, hypothecation, lien,
assignment, title retention, option, right of set off, security
interest, trust arrangement and any other preferential right or
agreement to confer security and any transaction which, in legal terms,
is not a secured borrowing but which has an economic or financial
effect similar to that of a secured borrowing;
"FLOATING CHARGE ASSETS": the assets of such company from time to time
expressed to be charged by this Charge by way of floating charge;
"INTEREST": interest computed at the rate stated in clause 5.4 of each
of the Agreements for overdue sums and compounded according to the
usual practice from time to time of the Chargee in respect of all or
any of the Secured Indebtedness;
"LOAN": the aggregate principal amount from time to time borrowed or
outstanding under the Agreements;
"MINIMUM RISKS": the risks in respect of loss or damage by fire, xxxxx,
xxxxxxx, flood, lightning, civil commotion, riot, explosion, malicious
damage, aircraft and other aerial devices and articles dropped
therefrom, burst pipes and impact damage;
"ORDINANCE": the Conveyancing and Property Ordinance, Chapter 219 of
the Laws of Hong Kong;
"RECEIVER": a receiver or receivers appointed in accordance with the
provisions of this Charge;
"SECURED INDEBTEDNESS": the Loan and all interest thereon and all other
moneys which are now or may at any time hereafter be due, owing or
incurred by the Company, the Guarantor or any other security party to
the Chargee in respect of or in connection with the Loan whether
actually or contingently, alone or jointly with any other person, and
whether as principal debtor or surety or otherwise howsoever, and in
whatever name, form or style under or pursuant to the Agreements, this
Charge and any other securities issued or guaranteed by the Company,
the Guarantor or any other security party and now or hereafter held by
the Chargee;
this "SECURITY": the security constituted by this Charge;
"SENIOR DEBT": all present and future sums, liabilities and obligations
from time to time owing or incurred (actually or contingently) under,
pursuant to or in connection with the Leumi Credit Agreement and/or the
Senior Security;
"SENIOR SECURITY": the security granted under, pursuant to or in
connection with the Leumi Credit Agreement to secure the Senior Debt or
any part thereof, including any alterations or supplements to the
security, novations of the security or replacement of the security;
1.3 References in this Charge to statutes shall include any other statute,
bye-law, regulation or delegated legislation in force whether before or
after the date of this Charge modifying, re-enacting, extending or made
pursuant to the first-mentioned statute.
2.
1.4 References in this Charge to Clauses, Sub-clauses, Recitals and the
Schedule are references to those contained in this Charge.
1.5 Clause headings are for ease of reference only and shall not affect the
construction of this Charge.
1.6 Words importing the singular number only shall include the plural and
vice versa and words importing the masculine gender shall include the
feminine and neuter genders and vice versa.
1.7 The expression "CHARGEE" shall include its successors, assigns and
transferees and this Charge shall enure to the benefit of and be
enforceable by the Chargee notwithstanding any change in its
constitution or its absorption into or amalgamation with any other
person or the acquisition of all or part of its undertaking by any
other person.
2. CHARGE AND ASSIGNMENT
2.1 (a) Subject always to the Senior Security, the Company HEREBY
CHARGES in favour of the Chargee as security for the payment
and discharge of the Secured Indebtedness:
(i) by way of fixed charge all present and future
fixtures, plant, machinery, vehicles, furniture,
furnishings, fixtures, goods, assets, merchandise,
consumables, products computers, and other office
tools, equipment and appliances and the benefit of
all contracts and warranties relating to the same in
which the Company now or at any time during the
continuance of this Security has an interest
(including but not limited to those listed on the
Schedule); and
(ii) by way of floating charge all raw materials, stock-
in-trade, work-in-progress and inventory of the
Company from time to time and all other undertaking,
property and assets, both present and future of the
Company, including those comprised in the property,
assets and undertaking of the Company described in
Sub-clause (i) above if and insofar as the charge on
such property, assets and undertaking or on any part
or parts thereof shall for any reason be ineffective
as a fixed charge.
(b) The Charges may at any time by notice to the Company convert
the floating charge hereby created into a fixed charge as
regards such Charged Assets as may be specified (whether
generally or specifically) in such notice.
2.2 This Security is a continuing security and shall remain in force
notwithstanding any intermediate payment or settlement of account or
other matter whatsoever and is in addition to and shall not merge into
or otherwise prejudice or affect any guarantee, Encumbrance or other
right or remedy now or hereafter held by or available to the Chargee
and shall not be in any way prejudiced or affected thereby or by the
invalidity
3.
thereof or by the Chargee now or hereafter dealing with exchanging
releasing modifying or abstaining from perfecting or enforcing any of
the same or any right which the Chargee may now or hereafter have or
giving time for payment or indulgence or compounding with any other
person.
2.3 The Company shall not without the prior written consent of the Chargee
create or permit to arise or to subsist any Encumbrance upon the whole
or any part of the Charged Assets other than this Security and the
Senior Security and, without prejudice to the foregoing, any mortgage,
charge, lien, pledge or other Encumbrance hereafter created by the
Company (otherwise than in favour of the Chargee) shall be, and be
expressed to be, subject to and rank behind this Security.
2.4 The Company shall not, without the prior written consent of the
Chargee, part with, sell or dispose of the whole of the Charged Assets
or any part thereof except in the case of Floating Charge Assets
which may, subject to the other provisions of this Charge, be
disposed of in the ordinary course of business.
3. PERFECTION OF SECURITY AND FURTHER ASSURANCE
3.1 The Company shall, when required by the Chargee (whether before or
after this Security shall have become enforceable), execute and do all
such mortgages, charges, transfers, assignments, assurances,
instruments, notices, documents, acts and things in such form or
otherwise as the Chargee may require for maintaining, perfecting or
protecting the security intended to be hereby constituted, for further
charging the Charged Assets in order to further secure the Secured
Indebtedness, for converting any floating charge forming part of this
Security into a fixed charge, for protecting the Chargee's interest in
the Charged Assets or for effecting or facilitating the exercise by the
Chargee of its powers, authorities and discretions conferred on it or
any Receiver hereby or by statute. For the purposes of this Clause, a
certificate in writing signed by or on behalf of the Chargee to the
effect that any particular transfer, assignment, assurance, act or
thing required by the Chargee is reasonably required shall be
conclusive evidence of the fact.
3.2 The Company shall from time to time when so required by the Chargee
produce to and/or deposit with the Chargee, during the continuance of
this Security, all deeds and documents of title relating to the Charged
Assets or any of them.
4. REPRESENTATIONS BY THE COMPANY
The Company hereby represents and warrants that:
(a) the Company is and will, at all times during the subsistence
of this Security, be the sole lawful and beneficial owner of
all of the Charged Assets and has the right to charge the
Charged Assets in the manner herein free from any lien,
mortgage, charge or other Encumbrances (save for this Security
and the Senior Security).
(b) it has not sold or granted any rights of pre-emption over or
agreed to sell or grant any right of pre-emption over or
otherwise disposed of or agreed to dispose of,
4.
the benefit of all or any of its rights, title and interest in
and to the Charged Assets or any part thereof (save for the
Senior Security);
(c) the Company is not and is not deemed to be unable to pay its
debts within the meaning of Section 178 of the Companies
Ordinance nor will it be so deemed in consequence of its
entering into this Charge or any of the transactions
contemplated hereby or by the Agreements; and
(d) the execution of this Charge and the creation of this
Security are within the corporate powers of the Company and
the directors of the Company have taken all necessary action
to authorise such execution and creation and the
implementation of this Charge.
5. OBLIGATIONS OF THE COMPANY
5.1 The Company shall take all such action as is available to it:-
(a) to perfect and protect the security intended to be conferred
on the Chargee by or pursuant to this Charge;
(b) to maintain the security hereby intended to be created; and
(c) to make all such filings and registrations, and to take all
such other steps, as may be necessary in connection with the
creation, perfection or protection of any security which it
may, or may be required to, create in connection herewith.
5.2 During the continuance of this Security, the Company covenants that it
shall:-
(a) not without the prior written consent of the Chargee grant or
agree to grant any lease or licence affecting all or any of
the Charged Assets or accept or agree to accept any surrender
of any lease or licence thereof or agree, accept, suffer or
permit any alteration, variation or addition to the terms of
such lease or licence;
(b) at all times give to the Chargee such information as the
Chargee may reasonably require for the purpose of the
discharge of the powers, rights, duties, trusts, authorities
and discretions vested in it hereunder or by operation of law;
(c) ensure that it is and remains the sole, lawful and beneficial
owner of all of the Charged Assets free from any lien,
mortgage, charge or other Encumbrances (save for this Security
and the Senior Security and as otherwise permitted hereunder
or under the Agreements);
(d) indemnify the Chargee and, as a separate covenant, any
Receiver or Receivers appointed by it hereunder against all
existing and future Taxes, duties, charges, assessments,
impositions and outgoings whatever (whether imposed by deed or
statute or otherwise and whether in the nature of capital or
revenue and even
5.
though of a wholly novel character) now or at any time during
the continuance of this Security payable in respect of the
Charged Assets or any part thereof and, if any such sums shall
be paid or incurred by the Chargee or any such Receiver or
Receivers, the same shall be repaid by the Company on demand
together with Interest as if such sums were unpaid sums from
the time or respective times of the same having been paid or
incurred by the Chargee or such Receiver or Receivers, as the
case may be, to the date of such repayment;
(e) insure and keep insured all of the Charged Assets with such
insurer and against such risks (including, in any event, the
Minimum Risks) and in such amounts and otherwise upon such
terms as the Chargee may from time to time require in each
case in the name of the Chargee or with the interest of the
Chargee noted on the policy, as the Chargee may require, and
with a clause to ensure payment of any loss to the Chargee in
the full replacement value thereof, and maintain such other
insurances as are normally maintained by a prudent company
carrying on similar business, and duly pay and discharge all
premiums and other moneys necessary for effecting and keeping
up such insurances, and produce to and deposit with the
Chargee the policies of such insurance and all premium
receipts in respect thereof forthwith upon receipt of the
same, failing which the Chargee may take out or renew such
insurances in any sum which the Chargee may think expedient,
and all moneys expended by the Chargee under this Clause shall
be reimbursed by the Company on demand and bear Interest from
the time of the same having been expended and, until such
payment, the same shall be deemed part of the Secured
Indebtedness and shall be recoverable accordingly. Prior to
the occurrence of an Event of Default, all moneys to be
received by virtue of any of the aforesaid insurances shall,
at the option of the Chargee, be applied either in replacing,
restoring or reinstating the undertaking, property and assets
or part thereof destroyed or damaged or in prepayment and/or
reduction of the Secured Indebtedness (and pending such
application, the proceeds may be placed by the Chargee in a
suspense account). Upon and after the occurrence of an Event
of Default, all moneys to be received by virtue of any of the
aforesaid insurances shall be applied by the Chargee in
prepayment and/or reduction of the Secured Indebtedness (and
pending such application, the proceeds may be placed by the
Chargee in a suspense account);
(f) in the event that a deficiency exists after all moneys to be
received by virtue of any insurances referred to in Sub-clause
(e) above have been applied towards replacing restoring or
reinstating the Charged Assets or part thereof as referred to
in Sub-clause (e) above, the Company shall forthwith make good
or cause to be made good such deficiency;
(g) do all such things and execute all such documents as the
Chargee may reasonably require for the purpose of perfecting
the Chargee's security or assuring to the Chargee that the
assets of the Company will not be lost or dissipated;
(h) carry on its business in a proper and efficient manner and
shall not, without the prior written consent of the Chargee,
make any material alteration in the nature
6.
of that business or incur any expenditure or liabilities of an
exceptional or unusual nature; and
(i) promptly afford such facilities as the Chargee shall require
to enable the Chargee or its duly authorised agent to
investigate to its or their satisfaction the matters
aforesaid.
5.3 Save for and subject to the Senior Security, the Company shall not,
without the prior written consent of the Chargee:
(a) sell, assign, transfer, mortgage, charge (including a charge
by way of floating charge) create or permit to arise any other
Encumbrance thereon, sub-divide, let, lease or otherwise
dispose, part with the use, occupation or possession or make
any arrangement for the sharing of or otherwise deal with the
Charged Assets or any part thereof (or any interest or
undivided share or shares therein) or agree to do any of the
above whereby any person other than the Company obtains the
use, occupation or possession of the Charged Assets or any
part thereof (irrespective of whether any rental or other
consideration is given) or cause or permit any second or
further charge to be effected of the Charged Assets or in any
way encumber the equity of redemption therein or diminish
jeopardise or prejudice the security hereby afforded to the
Chargee or permit the same to be done without the prior
written consent of the Chargee; and
(b) without prejudice to the generality of the foregoing, permit
any person to be or become entitled to assert any proprietary
or other like right or interest which might adversely affect
the value of the Charged Assets.
6. EVENTS OF DEFAULT
This Security shall become enforceable by the Chargee immediately upon
the happening of any Event of Default.
7. ENFORCEMENT
7.1 At any time after this Security shall have become enforceable, the
Chargee may (subject always to the Senior Debt and the Senior Security)
without prejudice to any other rights it may have and without prior
notice to the Company:
(a) sell, call in, collect, convert into money or otherwise deal
with or dispose of the Charged Assets or any part thereof on
an instalment basis or otherwise and generally in such manner
and upon such terms whatever as the Chargee may think fit and
the provisions of the Ordinance relating to and regulating the
exercise of the said power of sale shall, so far as they
relate to this Security, be varied and extended accordingly
and, in particular, paragraph 11 of the Fourth Schedule to
7.
the Ordinance shall not restrict the exercise by the Chargee
of the statutory power of sale conferred on it by the
Ordinance;
(b) exercise any and all powers which a Receiver could exercise;
and
(c) appoint by writing any person or persons to be a Receiver of
all or any part of the Charged Assets, from time to time
determine the remuneration of the Receiver and remove the
Receiver (except where an order of the Court is required
therefor) and appoint another in place of any Receiver,
whether he is removed by the Chargee or an order of the Court
or otherwise ceases to be the Receiver or one of two or more
Receivers. Every such appointment or removal, and every
delegation, appointment or removal by the Chargee in the
exercise of any right to delegate its powers or to remove
delegates herein contained, may be made either by deed or by
instrument in writing under the hand of any officer of the
Chargee or any person authorised in writing in that behalf by
any such officer.
7.2 Every Receiver for the time being holding office by virtue of an
appointment made by the Chargee hereunder shall (subject to any
limitations or restrictions expressed in the deed or other instrument
appointing him but notwithstanding any winding-up or dissolution of the
Company) have, in relation to the Charged Assets, or as the case may
be, that part of the Charged Assets in respect of which he was
appointed:
(a) all the powers (as varied and extended by the provisions
hereof) conferred by the Ordinance or otherwise by law on
mortgagees (whether or not in possession) and receivers
appointed under the Ordinance; and
(b) power in the name or on behalf and at the cost of the Company
which is the beneficial owner of such Charged Assets to
exercise all the powers and rights of an absolute owner and do
or omit to do anything which the Company itself could do.
7.3 The Receiver shall be the agent of the Company (which shall alone be
personally liable for the Receiver's acts, defaults and remuneration)
and in particular by way of addition to but with prejudice to any of
the foregoing, such Receiver shall have the following additional
powers:
(a) power to take possession of, collect and get in the Charged
Assets;
(b) power to sell (by public auction, private contract or
otherwise), lease or otherwise dispose of or concur in
selling, leasing, accepting surrenders or otherwise disposing
of the whole or any part of the Charged Assets in such manner
and generally upon such terms and subject to such covenants
and conditions granted or undertaken in the name of the
Company as he shall think fit, and in making any sale or other
disposal of any of the Charged Assets in the exercise of their
respective powers the Receiver or the Chargee may accept, as
and by way of consideration for such sale or other disposal,
cash, shares, loan capital or other obligations, including
without limitation consideration fluctuating according to or
8.
dependent upon profit or turnover and consideration the amount
whereof is to be determined by a third party. Any such
consideration may be receivable in a lump sum or by
instalments and upon receipt by the Receiver shall ipso facto
be and become charged with the payment of the Secured
Indebtedness. Any contract for any such sale or other disposal
by the Receiver or the Chargee may contain conditions
excluding or restricting the personal liability of the
Receiver or the Chargee (save for gross negligence, fraud or
wilful misconduct);
(c) power to demand and recover all the income in respect of any
of the Charged Assets by action, distress or otherwise in the
name of either of the Company or the Chargee to the full
extent of the estate or interest which the Company could
dispose of and to give effectual receipts accordingly for the
same;
(d) power to borrow from the Chargee or others on such terms
(with or without security) as he or the Chargee shall think
fit and so that, with the prior written consent of the
Chargee, any such security may be or include a charge on the
whole or any part of the Charged Assets ranking wholly or
partly in priority to or pari passu with this Security;
(e) power to make any arrangement or compromise of claims or enter
into any contracts in respect of the Charged Assets as he
shall think fit;
(f) power to effect and renew insurances relating to the Charged
Assets;
(g) power to employ, engage and appoint such managers and other
employees and professional advisers on such terms as he shall
think fit including without limitation power to engage his own
firm in the conduct of the receivership;
(h) power to carry out all repairs, developments, improvements and
other things which he or the Chargee shall consider necessary
or appropriate in respect of the Charged Assets;
(i) .power to sever any fixtures and fittings from any real
property include the Property or any part thereof, and sell
the same separately without the consent of the Company being
obtained thereto;
(j) power to make to the exclusion of the directors' power in that
behalf, calls conditionally or unconditionally in respect of
the uncalled capital of the Company and to enforce the same;
(k) power to exercise all voting and other rights attaching to
stocks, shares and other securities owned by the Company;
(l) power to grant any option or licence over all or any part of
the Charged Assets;
(m) power to carry on or authorise or concur in carrying on the
business of the Company in relation to the Charged Assets or
any part thereof and to manage and
9.
conduct the same and for such purposes to raise money on the
security of the Charged Assets or part thereof or interest
thereon in priority to this Security or otherwise and at such
rate of interest and generally on such terms and conditions as
he may think fit and no person lending any such money shall be
concerned to enquire as to the propriety or purpose of the
exercise of this power or see to the application of any moneys
so raised or borrowed provided that a Receiver shall not
exercise this power without first obtaining the written
consent of the Chargee;
(n) power to promote the formation of companies with a view to the
same purchasing all or any of the Charged Assets or otherwise;
(o) power to retain out of any money received by him his
remuneration and all cost, charges and expenses properly
incurred by him as Receiver;
(p) power to do all such other things as may seem to him to be
incidental or conducive to any other power vested in him or to
any of the matters or powers aforesaid; and
(q) power to exercise any of the above powers on behalf of and in
the name of the Company (notwithstanding any liquidation of
the Company) or on his own behalf.
7.4 The following provisions as to the appointment, powers, rights and
duties of a Receiver shall have effect in the event of the Chargee
appointing a Receiver pursuant to Clause 7.1:
(a) such appointment may be made either before or after the
Chargee shall have entered into or taken possession of the
Charged Assets or any part thereof;
(b) such Receiver may (at the absolute discretion of the Chargee)
be appointed either receiver of all the Charged Assets or of
such part or parts thereof as may be specified in the
appointment and in such latter event the powers hereinbefore
conferred on a Receiver shall have effect as though every
reference therein to the Charged Assets were limited to the
part or parts of the Charged Assets so specified;
(c) such Receiver or Receivers may be vested by the Chargee with
such powers and discretions, including powers of management,
as the Chargee may think expedient;
(d) unless otherwise directed by the Chargee, any Receiver may
exercise all the powers and authorities vested in the Chargee
hereunder;
(e) such Receiver shall in the exercise of his powers,
authorities and discretions conform to any regulations and
directions from time to time made and given by the Chargee
provided that no person dealing with such Receiver shall be
concerned to enquire whether such Receiver has so conformed to
such regulations or directions;
10.
(f) the Chargee may from time to time and at any time require any
such Receiver to give security for the due performance of his
duties as a receiver and may fix the nature and amount of the
security to be so given, but the Chargee shall not be bound in
any case to require any such security;
(g) save so far as otherwise directed by the Chargee, all monies
from time to time received by such Receiver shall be paid over
to the Chargee to be held by the Chargee on the trusts herein
declared of and concerning moneys which arise from any
letting, leasing, sale, calling in, collection, conversion or
other dealing with the Charged Assets;
(h) the Chargee may pay over to such Receiver any moneys
constituting part of the Charged Assets or the income thereof
to the intent that the same may be applied for the purposes
hereof by such Receiver, and the Chargee may from time to time
determine what funds the Receiver shall be at liberty to keep
in hand with a view to the performance of his duties as a
receiver;
(i) every such Receiver shall be the agent of the Company for all
purposes and the Company alone shall be responsible for his
acts and defaults, loss or misconduct (save in the case of
gross negligence, fraud or wilful misconduct) and for the
payment of his remuneration, and the Chargee shall not incur
any liability therefor by reason of the Chargee appointing him
as a receiver or otherwise;
(j) any Receiver may act in his own name or in the name of the
Chargee;
(k) every Receiver, attorney, manager, agent or other person
appointed by the Chargee hereunder shall be entitled to be
indemnified out of the Charged Assets and the income thereof
in respect of all liabilities and expenses incurred by him in
the execution or purported execution of the terms and
conditions of this Charge and against all actions,
proceedings, claims and demands in respect of any matter or
thing done or omitted in any way relating to the Charged
Assets and the Chargee may retain and pay out of any money in
its hands arising from the terms and conditions of this Charge
all sums necessary to effect such indemnity and all such sums
shall be a charge on the Charged Assets;
(l) where more than one Receiver is appointed in accordance with
the provisions herein contained any reference in this Charge
to a Receiver shall apply to both or all of the Receivers so
appointed, and the appointment of the Receivers shall be
deemed to be a joint and several appointment to the intent
that the rights, powers, duties and discretions vested in the
Receivers may be exercised jointly by the Receivers so
appointed or severally by each of them; and
(m) the foregoing powers of appointment of a Receiver shall be
and remain exercisable by the Chargee in respect of any part
of the Charged Assets in respect of which no appointment of a
Receiver by the Chargee shall from time to time be subsisting
and notwithstanding that an appointment under the provisions
of this Clause shall
11.
have subsisted and been withdrawn in respect of that property
or shall be subsisting in respect of any other part of the
Charged Assets.
7.5 At any time after this Security becomes enforceable, the Chargee or
the Receiver may sever the fixtures and fittings from any real property
and sell the same separately without the consent of the Company being
obtained thereto.
7.6 Neither the Chargee nor any Receiver shall by reason of entering into
possession of the Charged Assets or any part thereof be liable to
account as mortgagee in possession or for any default or omission of
any nature whatsoever for which a mortgagee in possession might be
liable, or be liable for any loss or damage occasioned by or upon
realisation or for any diminution in value happening in or about the
exercise of any power conferred hereby or by statute and the Company
shall not have any right or action or claim against the Chargee or any
Receiver on the grounds that a better price could or might have been
obtained on any such realisation, sale or disposal or for any default
or omission of any nature whatsoever for which a mortgagee in
possession might be liable. The Company agrees with the Chargee that it
will not xxx the Receiver in respect of any of the matters referred to
above.
7.7 No person dealing with the Chargee or its agent or any Receiver
appointed hereunder or with its or his attorneys or agents shall be
concerned to enquire whether any event has occurred to authorise the
Receiver to act or the security hereby constituted has become
enforceable or be concerned with notice to the contrary, or whether the
power exercised or purported to be exercised has become exercisable or
whether any moneys remain due upon this Security or as to the necessity
or expediency of the stipulations and conditions subject to which any
sale shall be made, or otherwise as to the propriety or regularity of
any sale, calling in, dealing, collection, conversion or power
exercised or to see to the application of any money paid to the Chargee
or to any Receiver or its or his attorneys or agents, and in the
absence of fraud on the part of such person such dealing shall be
deemed so far as regards the safety and protection of such person to be
within the powers hereby conferred and to be valid and effectual
accordingly and the remedy of the Company in respect of any
irregularity or impropriety whatsoever in the exercise of such powers
shall be in damages only.
7.8 Upon any such letting, leasing, sale, calling in, collection or
conversion as aforesaid and upon any other dealing or transaction under
the provisions herein contained the receipt of the Chargee or any
Receiver for the rent or proceeds thereof and for any other moneys paid
to it or him shall effectually discharge the tenant, lessee, purchaser
or person paying the same therefrom and from being concerned to see to
the application or being answerable for the loss or misapplication
thereof.
7.9 The Chargee or any Receiver so appointed shall hold the moneys arising
from any such letting, leasing, sale, calling in, collection,
conversion or dealing under the powers herein contained and all moneys
received under any powers hereby conferred upon the Chargee or upon any
Receiver after the security hereby created has become enforceable upon
trust to be applied (subject to the payment of any claims having
priority to this Charge) in the following order:
12.
(a) unless the Charged Assets is sold subject to a prior
incumbrance, in discharge of that prior incumbrance;
(b) in payment of the Receiver's lawful remuneration, costs,
charges and expenses and all lawful costs and expenses
properly incurred in the sale or other dealing;
(c) in payment of the Secured Indebtedness, and any residue shall
be paid to the person who immediately before any sale or other
dealing was entitled to the Charged Assets or authorised to
give a receipt for the proceeds of the sale of the Charged
Assets.
7.10 The Company hereby irrevocably and by way of security appoints the
Chargee and any Receiver jointly and each of them severally to be the
Company's attorney (with full power of substitution) and in its name
and on its behalf and as its act and deed to sign, seal, execute,
deliver, perfect and do all deeds, instruments, acts and things
whatsoever which shall in the opinion of the Chargee (whose opinion
shall be conclusive and binding upon the Company) be necessary or
expedient that the Company should do or which the Chargee or a Receiver
is empowered to do under this Charge for the purpose of carrying out
any obligation hereby declared or imposed upon the Company or for
giving to the Chargee the full benefit of any of the provisions hereof
and generally to use the Company's name in the exercise of all or any
of the powers hereby conferred on the Chargee or any Receiver appointed
by the Chargee hereunder. The Chargee shall have full power to delegate
the power conferred on it by this Clause, but no such delegation shall
preclude the subsequent exercise of such power by the Chargee itself or
preclude the Chargee from making a subsequent delegation thereof to
some other person; and any such delegation may be revoked by the
Chargee at any time. The Company covenants that it will ratify and
confirm all that the attorney shall lawfully do or cause to be done by
virtue of these presents.
7.11 The power to appoint a Receiver conferred herein or by statute shall
be and remain exercisable by the Chargee notwithstanding any prior
appointment in respect of all or any part of the Charged Assets.
7.12 The Company declares that as and when this Security becomes
enforceable it will hold the Charged Assets (subject to the Company's
right of redemption) upon trust to convey, assign or otherwise deal
with the same in such manner and to such person as the Chargee shall
direct and declares that it shall be lawful for the Chargee by an
instrument under its common seal to appoint a new trustee or trustees
of the Charged Assets and in particular but without limitation at any
time or times to appoint a new trustee or trustees thereof in place of
the Company.
13.
8. CHARGEE'S ADDITIONAL POWERS AND RIGHTS
8.1 At any time after this Security shall have become enforceable the
Chargee or a Receiver may (but shall not be obliged to), subject always
to the Senior Security, do any such thing and incur any such
expenditure as the Chargee or such Receiver shall in its sole
discretion consider necessary or desirable to remedy each or any
default by the Company and to protect or realise this Security or its
interests under this Charge and in particular (but without limitation)
may enter upon the Company's property and may pay any moneys which may
be payable in respect of any of the Charged Assets and any moneys
expended in so doing by the Chargee or Receiver shall be deemed an
expense properly incurred and paid by the Chargee and the Company shall
reimburse the same on demand to the Chargee.
8.2 If the Company shall without the prior written agreement of the
Chargee create or permit to arise or subsist any Encumbrance (save for
this Security and the Senior Security) affecting the Charged Assets,
the Chargee may open a new account for the Company, and if the Chargee
does not in fact open such new account it shall nevertheless be treated
as if it had done so at the time when it received notice of such
Encumbrance and as from that time all payments made by or on behalf of
the Company to the Chargee shall be credited or be treated as having
been credited to the new account and such payments shall not operate to
reduce the amount due from the Company to the Chargee at the said time
(but this Clause shall not prejudice any security which apart from this
Clause the Chargee would have had for the discharge by the Company of
liabilities or obligations incurred after that time).
8.3 All moneys received, recovered or realised by the Chargee under this
Security may at the sole discretion of the Chargee be credited by the
Chargee to any suspense or impersonal account pending the application
from time to time of such moneys and accrued interest thereon at the
rate if any agreed in writing between the Company and the Chargee from
time to time (as the Chargee shall be entitled to do in its discretion)
in or towards the discharge of any of the Secured Indebtedness.
9 APPLICATION OF RECEIPTS
Subject to the Senior Security, any moneys received by or on behalf of
a Receiver or the Chargee under the powers hereby conferred shall
(subject to the repayment of any claims having priority to this Charge)
be paid or applied in the following order of priority:
(a) first, in satisfaction of all costs, charges and expenses
properly incurred and payments properly made by the Chargee or
any Receiver and of the remuneration of any Receiver;
(b) secondly, in or towards satisfaction of the Secured
Indebtedness in such order as the Chargee in its absolute
discretion shall decide; and
(c) thirdly, to the person or persons entitled thereto.
14.
10. INDEMNITY
The Company hereby agrees to indemnify and hold harmless the Chargee
and any Receiver from and against all actions, claims, expenses,
demands and liabilities now or hereafter brought against or incurred by
either or both of them, or against or by any person for whose act or
omission either or both of them may be liable, resulting directly or
indirectly from any breach or non-observance by the Company of any of
the provisions of this Charge or any payment in respect of provisions
of this Charge or any payment in respect of the Secured Indebtedness
(whether made by the Company or a third party) being set aside or
declared void for any reason. The Chargee shall be entitled so to
indemnify and hold harmless the Receiver on behalf of the Company which
shall re-imburse the Chargee accordingly. The Company's liability to
the Chargee under the first or second sentences hereof shall form part
of the Secured Indebtedness and Interest shall accrue thereon
accordingly.
11. APPLICABLE RATE OF EXCHANGE
All moneys received or held by the Chargee or by a Receiver under this
Charge may from time to time be converted into such other currency as
the Chargee considers necessary or desirable to cover the Secured
Indebtedness in that currency at the then prevailing spot or other
appropriate rate of exchange of the Chargee (as conclusively determined
by the Chargee) for the currency acquired against the currency in which
such moneys were received or held.
12. COSTS AND EXPENSES
The Company shall pay or reimburse to the Chargee or the Receiver (as
the case may be), on demand all costs, charges and expenses incurred
and all other money paid by the Chargee in connection with the
preparation and execution of this Charge and the exercise by the
Chargee or any Receiver of its or his rights, powers and discretions
under this Charge, the administration of this Charge, the protection
and the enforcement of this Security and the payment of the Secured
Indebtedness or any other sum due from the Company to the Chargee
including without limitation all remuneration and expenses payable to
the Chargee or Receiver, and all stamp and other duties and taxes (if
any) to which this Charge and any other document executed in connection
herewith may be subject; and all of the foregoing shall be deemed
expenses properly incurred and paid by the Chargee hereunder and may be
debited to any account of the Company and shall form part of the
Secured Indebtedness and Interest shall accrue thereon accordingly.
15.
13. GENERAL
13.1 No failure or delay by the Chargee in exercising any right, power or
privilege under this Charge shall operate as a waiver thereof, nor
shall any single or partial exercise by the Chargee of any right, power
or privilege preclude any further exercise thereof or the exercise of
any other right, power or privilege. The rights and remedies herein
provided are cumulative and not exclusive of any rights or remedies
provided by law.
13.2 Any release, settlement or discharge between the Company and the
Chargee shall be conditional upon no security or payment made or given
to the Chargee being avoided, reduced, set aside or rendered
unenforceable by virtue of any provision or enactment now or hereafter
in force relating to bankruptcy, insolvency or liquidation and if any
such security or payment shall be avoided, reduced, set aside or
rendered unenforceable the Chargee shall be entitled to recover the
full amount or value of any such security or payment from the Company
and otherwise to enforce this Charge as if such release, settlement or
discharge had not taken place.
13.3 The benefit of this Charge shall be transferable by the Chargee,
without regard to any set-off, counterclaim or equities between the
Company and the Chargee or any intermediate holder.
13.4 A certificate signed by an officer of the Chargee as to the amount at
any time of the Secured Indebtedness or any part thereof or any
Interest accrued thereon shall be binding and conclusive on the
Company.
13.5 This Security:
(a) shall be a continuing security and shall not be considered
satisfied by any intermediate payment or settlement of account
or otherwise but shall remain in force until all the Secured
Indebtedness shall have been paid or discharged in full;
(b) shall not prejudice or be prejudiced by any other security
held by the Chargee at any time or any right the Chargee might
have against any other person in respect of the Secured
Indebtedness or any part thereof; and
(c) shall not be affected or discharged by the taking, holding,
varying, non-enforcement or release by the Chargee of any
other security for all or any of the sums payment of which is
hereby covenanted to be made or is hereby secured, or by any
other thing done or omitted or neglected to be done by the
Chargee in relation to any such other security, and is in
addition to and not in substitution for any other security
which the Chargee may at any time hold for the payment of such
moneys or any of them and may be enforced without first having
recourse to any such other security.
13.6 If any one or more of the provisions contained in this Charge shall be
invalid, illegal, or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
16.
13.7 No provisions hereof may be amended, waived, discharged or terminated
orally, but only by an instrument in writing signed by the party
against whom enforcement of the amendment, waiver, discharge or
termination is sought.
13.8 This Charge shall be binding upon and enure to the benefit of each
party hereto and its permitted assigns, except that the Company may not
assign or transfer any of its rights or benefits hereunder.
14. NOTICES
14.1 Any notice or other communication served, given or made under this
Charge will be in writing and, without prejudice to the validity of any
other method of service, may be delivered personally or by courier or
sent by facsimile transmission, addressed as follows:
(a) if to the Chargee, to:
Address: 0xx Xxxxx, Xxxxxxxxxx Xxxxx
00 Xxx Xxx Xxxxxx
San Po Kong
Kowloon
Hong Kong
Facsimile transmission number: (000) 0000 0000
Attention: Xx. Xxxxxxx So
C.C.: Xx. Xxxxxx X. Xxxxx;
(b) if to the Company, to:
Address: 1st Floor, Efficiency Xxxxx
00 Xxx Xxx Xxxxxx
Xxx Xx Xxxx
Xxxxxxx
Xxxx Xxxx
Facsimile transmission number: (000) 0000 0000
Attention: Xx. Xxxx Xxxxxx
C.C.: Xx. Xxx Xxxxxx;
or to any other address or facsimile transmission number, or person for
whose attention the communication is to be addressed, as the relevant
addressee may substitute by fourteen days' prior notice in writing to
the other party to this Charge.
14.2 Any notice or other communication will be deemed to have been duly
served, given or made (i) in the case of posting, two Business Days
after the envelope containing the notice was delivered to the courier;
or (ii) in the case of delivery, when left at the relevant address; or
(iii) in the case of a facsimile transmission, on receipt by the
addressee of the substantially complete text in legible form.
17.
14.3 All notices, certificates and other documents and communications given
or made under or in connection with this Charge will be in the English
language.
15. GOVERNING LAW
15.1 This Charge shall be governed by and construed in all respects in
accordance with English law and it is irrevocably agreed for the
exclusive benefit of the Chargee that the courts of England are to have
non-exclusive jurisdiction to settle any disputes which may arise out
of or in connection with this Charge and that accordingly any suit,
action or proceeding arising out of or in connection with this Charge
(in this Clause referred to as "PROCEEDINGS") may be brought in such
courts. Nothing in this Clause shall limit the right of the Chargee to
take the Proceedings against the Company in any other court of
competent jurisdiction, nor shall the taking of Proceedings in one or
more jurisdictions preclude the taking of Proceedings in any other
jurisdiction, whether concurrently or not.
15.2 The Company hereby appoints_________________________________________ of
______________________________________________________________________,
England (marked for the attention of _________________________________)
as its authorised agent for the purpose of accepting service of process
for all purposes in connection with this Charge.
15.3 To the extent that the Company may be entitled in any jurisdiction to
claim for itself or any of its property or assets immunity in respect
of its obligations under this Charge from service of process,
jurisdiction, suit, judgment, execution, attachment (whether before
judgment, in aid of execution or otherwise) or legal process or to the
extent that in any jurisdiction there may be attributed to it or all or
any of its property or assets immunity of that kind (whether or not
claimed), the Company irrevocably agrees not to claim and irrevocably
waives that immunity to the fullest extent permitted by the laws of
that jurisdiction.
IN WITNESS WHEREOF this Charge has been duly executed by all the parties hereto
the day and year first above written.
THE COMPANY
SIGNED, SEALED and DELIVERED )
by )
as attorney for and on behalf of ) /S/ ILLEGIBLE
DURABLE ELECTRONICS )
INDUSTRIES LIMITED )
as its Deed in the presence of )
18.
THE CHARGEE
SIGNED, SEALED and DELIVERED )
by )
as attorney for and on behalf of ) /S/ ILLEGIBLE
DURABLE ELECTRICAL METAL )
FACTORY LIMITED )
as its Deed in the presence of )
19.
SCHEDULE
THE ASSETS
20.
