Exhibit 10.3

 

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Far Eastern International Bank

 

Credit Terms / Financial Transaction Terms Agreement

(exclusively for corporate finance purpose)

 

 

Customer: Prime World International Holding Ltd. Taiwan Branch

 

 

Agreement No.: _____________________________

 

 

Credit Line: NTD 80,000,000

 

 

Term of Agreement: From April 11th, 2019 to April 11th, 2020

 

 

First utilization date: Before July 10th, 2019

 

 

Regional Supervisor:__________ Business Supervisor:__________ Handling
Officer:__________

 

 

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Credit Terms / Financial Transaction Terms Agreement

 

 

This Agreement is made by and between the following parties:

 

Prime World International Holding Ltd. Taiwan Branch (the “Customer”)

 

Far Eastern International Bank Co., Ltd. (“FEIB”)

 

With reference to the Customer's application for loan / financial transaction
service to FEIB, the Customer has requested and has further signed a

 

□Comprehensive Credit Facilities Master Agreement / □Comprehensive Financial
Transaction Agreement /□ISDA. The Customer agree that aforementioned master
agreement provides the general terms and conditions governing the financial
transactions between the Customer. The Customer also agrees that without
violating the nature of the transactions contemplated by this Agreement and
applicable laws and regulations of the competent authority of FEIB, FEIB may,
upon the application of the Customer, exchange New Taiwan Dollars for foreign
currency in the equivalent amount and vice versa for disbursement of loans, at
the spot selling rate then posted by FEIB as the exchange rate unless otherwise
stipulated, while the relevant terms and conditions financial transactions. Now,
therefore, the parties hereby agree as follows. However, if FEIB does not
approve the commitment fees or fails to receive the approved commitment fees on
schedule, or the creditworthiness of the Customer deteriorates or likely to
deteriorate, FEIB may cancel any undrawn amount at any time and the Customer
shall raise no objection.

 

Loan and Financial Transaction Terms and Conditions (for the purposes of this
section, “the Bank” refers to FEIB):

 

I.Credit Type and Facility

Short-term comprehensive credit line NTD 80,000,000 only (or equivalent in other
currency), which includes the following types and their respective limits:

A.Short-term loan: NTD 80,000,000 only

B.Guarantees of commercial promissory notes: NTD 80,000,000 only

C.Import financing: NTD 80,000,000 only (or equivalent in other currency)

D.Export financing: NTD 80,000,000 only (or equivalent in other currency)    

II.Credit Period

1.The credit period will remain effective one (1) year from the signing date of
this agreement. Utilization shall be made within one year after the signing date
of the agreement; provided, that the signing of the agreement shall be made
within 90 days after the date of approval [of the facility] and that first
utilization shall be made within 90 days after the signing date of the
agreement. The Bank is entitled to reject any request if the above deadline is
not met.

2.Each utilization shall be repaid within 180 days.    

 

 

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III.Interest Rates and Service Fees

1.Credit line establishment fee: 0.25% of the credit line; charged upon the
first time of utilization.

2.With respect to NTD, the interest will bear at a rate equal to the Bank’s
published one-year fixed term time deposits rate plus 0.655% and calculated by a
floating rate, with margin to be adjusted every three months and may be
negotiated on a case-by-case basis based on the Bank’s funding status.

3.With respect to US Dollars, interest rate shall be TAIFX3 for a period equal
to the term of the utilization or the next longer tenor for which rates are
quoted, plus 0.7% (tax cost may extra be charged), with margin to be adjusted
every three months and may be negotiated on a case-by-case basis based on the
Bank’s funding status.

4.Annual Guarantee Handling Fee: 0.8%; calculated according to the actual number
of days; charged at the beginning of the period.

5.With respect to the issuance of letters of credit, a period of three months is
regarded as one term. The service fee for the first term is 0.1%. The service
fee for the second term is halved.

6.The interest of other foreign currencies may be negotiated on a case-by-case
basis based on the Bank’s funding cost.

 

IV.Utilization

1.May be utilized on a revolving basis.

2.For Section I. C (Import financing) and D (Export financing), loans will be
fully issued and utilized when INVOICE or other related documents are provided.

 

V.Repayment

1.For Section I. A (Short-term loan), the interest is paid monthly and the
principal shall be repaid upon maturity.

2.For Section I. B (Guarantees of commercial promissory notes) shall be repaid
upon maturity.

3.For Section I. C (Import financing) and D (Export financing), the principal
and interest shall be repaid upon maturity.

 

VI.Line of Credit Promissory Note

The Borrower shall issue a promissory note in the amount of the facility
extended hereunder and deliver same to the Bank.

 

VII. Others

 

1.The Borrower‘s headquarters company, Prime World International Holdings.,
Ltd., shall provide a document to certify their consent on the loan request of
the Borrower.

2.The Borrower‘s parent company, Applied Optoelectronics, Inc., shall issue a
Letter of Support.

3.Other matters not mentioned herein shall be governed by the Bank's
stipulations on credit granting.

 

 

 

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Date of verification Place of verification

Verified by

(signature)

April 11th, 2019 No.18, Gong 4th Rd., Gong’er Industrial Park, Linkou Dist., New
Taipei City                                

 

Signed by:

 

Far Eastern International Bank:

 

Representative:

 

Company I.D.:

 

Address:

 

Fax No.:

 

 

Customer: Prime World International Holding Ltd. Taiwan Branch (Registered seal
and signature affixed in person)

 

Representative: Lin, Chih-Hsiang

 

Company I.D.:28410552

 

Address: No.18, Gong 4th Rd., Gong’er Industrial Park, Linkou Dist., New Taipei
City

 

Fax no.:

 

 

Customer: (Registered seal and signature affixed in person)

 

Representative:

 

Company I.D.:

 

Address:

 

Fax no.:

 

 

 

 

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Customer and Security Provider:

(Registered seal and signature affixed in person)

 

Representative:

 

Company I.D.:

 

Address:

 

Fax no.:

 

 

Customer and Security Provider:

(Registered seal and signature affixed in person)

 

Representative:

 

Company I.D.:

 

Address:

 

Fax no.:

 

 

Security Provider: (Registered seal and signature affixed in person)

 

Representative:

 

Company I.D.:

 

Address:

 

Fax no.:

 

 

Security Provider: (Registered seal and signature affixed in person)

 

Representative:

 

Company I.D.:

 

Address:

 

Fax no.:

 

 

 

 

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Note 1: If a party to this Agreement is a minor or other person without full
legal capacity, this Agreement shall be signed in person by his legal
representative.

 

Note 2: For the purposes of this Agreement, the security provider refers to a
person providing security other than in the form of such negotiable securities
as stocks, bonds, certificates of deposit, or beneficial certificates. Persons
providing security in the form of such negotiable securities as stocks, bonds,
certificates of deposit, or beneficial certificates shall submit a security
provision agreement as required.

 

Note 3: For the resolution of disputes and avenues of complaints arising out of
this Agreement, please refer to the FEIB website.

 

 

 

 

Date: April 11th, 2019

 

 

 

 

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