Exhibit 10.5

 

 

 

No.: xd201308213452

 

 

 

 

 

 

Working Capital Loan Contract

 

 

 
 

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Note: This Contract is entered into by and between the borrower and the lender
after negotiation according to law and on the basis of equality and
voluntariness, and all the clauses hereof are true declarations of both parties’
intentions. To protect the borrower’s lawful rights and interests, the lender
specially reminds the borrower to pay adequate attention to all the clauses
related to both parties’ rights and obligations, especially the contents in
bold.

 

 

 
 

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[handwritten text is indicated in italics]

 

Lender: Bank of Handan Co., Ltd. Wu’an Sub-branch

Person in charge: Guo Jianxin

Contact person:

 

Domicile (Address): No.3 Fuzhong Garden, Fuqiang Street, Wu’an City

Zip code:

 

Tel:

 

 

Fax:

 

 

Email:

 

 

 

 

 

Borrower: Northern Altair Nanotechnologies Co., Ltd.

Legal representative: Zou Liming

Contact person:

 

Domicile (Address):

 

Zip code:

 

Tel:

 

 

Fax:

 

 

Email:

 

 

 

 

 

Through negotiation on an equal footing, the borrower and the lender reach
agreement on the lender’s granting of the loan hereunder to the borrower and
hereby enter into this Contract.

 

Article 1 Purpose of Loan

The loan hereunder shall be used for the following purpose and without the
lender’s written consent, the borrower shall not appropriate the loan for any
other purpose, and the lender is entitled to supervise the use of the loan.

Purpose of loan: Purchase of
goods                                                                                                                                                                                                              
                       

 

Article 2 Amount and Term of Loan

2.1 The loan hereunder is denominated in RMB, adding up to RMB 50,000,000 (SAY
FIFTY MILLION YUAN ONLY) (in case of discrepancy between the amounts in figures
and words, the latter shall prevail).

2.2 The term of the loan hereunder is 12 months, commencing on the date of
actual drawing (or commencing on the date of first drawing in case of several
drawings) subject to the IOU.

 

Article 3 Interest Rate, Interest and Costs

3.1 The interest rate of the loan in RMB shall be decided in the following
manner (1):

 

 

 
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(1)

Fixed interest rate, bearing a monthly interest rate of 9‰ and remaining
unchanged within the term hereof.

 

(2)

Floating interest rate, bearing a loan interest rate which is a sum of a
benchmark interest rate plus a floating range, the benchmark interest rate being
the one of the People’s Bank of China corresponding to ________ (date of
drawing/effective date of the Contract) and the term of the loan as agreed in
Article 2.2. The floating range shall be ______ (plus/minus) ___________%,
remaining unchanged within the term hereof. After the borrower draws the loan,
the benchmark interest rate shall be adjusted once a period which shall consist
of ___________ (1/3/6/12) month(s), and the interest shall accrue by period. The
deciding date of the interest rate for the second period shall be the
corresponding date which is one period after the date of drawing. If the month
of adjustment does not have the date corresponding to the date of drawing, the
last day of such month shall be deemed as the corresponding date, and the rest
of the other periods can be dealt with in the same manner. In case the borrower
draws the loan several times, regardless of the number of drawings within a
period, the current loan interest rate decided on the deciding date of the
interest rate for such period shall apply and an adjustment shall be made in the
following period.

 

(3)

Other: __________________________

3.2 The interest of the loan hereunder shall accrue on a daily basis from the
date of actual drawing and shall be settled on a monthly
(monthly/quarterly/semiannual) basis. When the loan becomes mature, the interest
shall be paid in full together with the principal. Daily interest rate = annual
interest rate/360.

3.3 The default interest rate hereunder shall be the original loan interest rate
plus 50%, and the interest rate of the interest penalty for the misappropriated
loan shall be the original loan interest rate plus 100%.

3.4 If the floating interest rate applies to the loan hereunder, the interest
rate shall still be adjusted in the original manner after the loan becomes
overdue.

3.5 If the interest of the loan is settled on a monthly basis, the date of
interest settlement shall be the 20th day of each month; if the interest of the
loan is settled on a quarterly basis, the date of interest settlement shall be
the 20th day of the last month of each quarter; and if the interest of the loan
is settled on a semiannual basis, the date of interest settlement shall be June
20 and December 20, respectively.

3.6 The first interest period shall commence on the date of actual drawing by
the borrower and end on the first date of interest settlement; the last interest
period shall commence on the day immediately following the end of the previous
interest period and end on the date of final repayment of the loan; and the
other interest periods shall commence on the day immediately following the end
of the previous interest period and end on the following date of interest
settlement.

3.7 In case the People’s Bank of China adjusts the measures for deciding the
loan interest rate, such measures shall apply without further notice from the
lender to the borrower.

 

 

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Article 4 Grant and Payment of Loan

4.1 The borrower shall draw the loan according to its actual spending demand.
The first drawing of the loan must be made before September 30, 2013 and the
last drawing thereof before _______; otherwise the lender shall be entitled to
cancel all or part of the loan. (This Article shall not apply to any revolving
loan)

4.2 With respect to the date of actual drawing and the date of repayment, the
dates recorded in the IOU handled by the borrower and the lender shall apply.
The IOU and the loan drawing voucher(s) are an integral part hereof, and except
the dates, in case of discrepancy between other recorded matters and those in
this Contract, the latter shall prevail.

4.3 The borrower must satisfy the following preconditions when drawing the loan;
otherwise the lender shall have no obligation to grant the borrower any money
unless the lender agrees to grant such loan in advance:

 

(1)

Except any credit loan, the borrower has provided a guarantee as required by the
lender and has completed handling relevant guarantee formalities;

 

(2)

There is no occurrence of any breach under this Contract or any other contract
between the borrower and the lender; and

 

(3)

The purpose of the loan as indicated in the provided certificate complies with
the agreed purpose.

4.4 Any written document provided by the borrower to the lender at the time of
drawing must be original; if the borrower is unable to provide the original, the
borrower may provide a copy affixed with its official seal with the lender’s
consent.

4.5 In applying for drawing, the borrower must submit a drawing application to
the lender at least 5 banking days earlier. Once such drawing application is
submitted, it shall not be canceled without the written consent of the lender.

4.6 After the borrower satisfies the drawing preconditions or the lender agrees
to grant the loan in advance, the lender shall be deemed to have granted the
loan to the borrower under this Contract when the lender transfers the loan to
the borrower’s designated account.

4.7 According to relevant regulatory provisions and the lender’s management
requirements, any loan that exceeds a certain amount or complies with other
conditions shall take the manner of imposing entrusted payment on the lender,
and the lender shall, according to the borrower’s drawing application and
payment entrustment, pay the loan to the payee in compliance with the agreed
purpose agreed herein. For this reason, the borrower shall otherwise sign an
agreement with the lender for entrusted payment as an appendix attached hereto,
and the borrower shall specially open or designate an account with the lender to
handle the entrusted payment.

 

 

 
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Article 5 Repayment

5.1 The main sources for the borrower’s repayment of the principal and interest
hereunder include without limitation:

 

(1)

the borrower’s sales incomes and profits; and

 

(2)

the realization of any of the borrower’s lawful assets.

5.2 The borrower shall repay the loan hereunder in the following manner (1):

 

(1)

The borrower shall repay the loan in lump-sum.

 

(2)

The borrower shall repay the loan in installments according to the following
repayment plan (another page may be attached when such plan contains too many
contents):

Date of planned repayment

Amount of planned repayment (ten thousand yuan)

                                                           

 

5.3 Where the loan hereunder belongs to the following circumstance, the borrower
shall forthwith repay the loan when the corresponding capital becomes available,
and in case of early repayment caused thereby, the borrower shall not be
required to pay any compensation:

 

_____________________________________________________________________

_____________________________________________________________________

 

 

 
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5.4 Except the circumstance agreed in Article 5.3, in case of early repayment,
the borrower shall pay the lender compensation equal to _____% of the amount of
repayment.

5.5 The borrower shall repay in full the principal and interest of the loan and
other amounts payable on time under this Contract. The borrower shall, one
banking day before the date of repayment and each date of interest settlement,
deposit in full the current interest and principal payable and other amounts
payable in its repayment account opened with the lender, and the lender shall be
entitled to proactively transfer and receive the same on such date of repayment
or of interest settlement, or to require the borrower to cooperate with the
lender in handling relevant transfer formalities. If the amount of the repayment
account is insufficient to pay all of the borrower’s amounts due and payable,
the lender shall be entitled to decide the reimbursement order.

5.6 If the borrower applies for early repayment of all or part of the loan, the
borrower shall submit a written application to the lender 10 banking days
earlier to seek the lender’s consent and shall pay compensation to the lender
according to the standard agreed herein.

5.7 In case of early repayment with the lender’s consent, the borrower shall, on
the date of early repayment, simultaneously pay in full the principal and
interest of the loan and other amounts, which become due and payable under the
Contract until such date of early repayment.

5.8 The lender is entitled to resume the loan earlier according to the
borrower’s capital receipt.

5.9 Where the borrower repays the loan earlier or the lender resumes the loan
earlier under this Contract so that the actual term of the loan is shortened,
the level of the corresponding interest rate shall not be adjusted and the
original loan interest rate shall remain in force and effect.

 

Article 6 Special Agreement on Revolving Loan (as an optional clause, this
article is ☐ applicable ☐ inapplicable)

6.1 The loan hereunder may be used cyclically, and the amount and term of the
loan as set forth in the aforesaid Article 2 are respectively the quota of the
revolving loan and the term of such quota which shall commence on the effective
date hereof.

6.2 In addition to the interest, the borrower shall also pay the lender a
commitment fee, which shall be paid in the following manner ______:

 

 

 
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(1) The commitment fee shall be _____% of the quota of the revolving loan and
shall be paid to the lender in lump-sum on the effective date hereof.

(2) After this Contract takes effect, the commitment fee shall, according to the
difference between the quota of the revolving loan and the amount already drawn
by the borrower (daily balance within the charging cycle) and an annual rate of
___%, be paid to the lender on the 20th day of each _____ (month/quarter/six
months) until the term of such quota expires.

(3) _______________________________________________.

6.3 Where the loan hereunder may be used cyclically, the sum of the borrower’s
balance at any time point within the term of the quota of the revolving loan
shall not exceed such quota; the loan term of each of the borrower’s drawings
shall commence on the date of actual drawing and end on the agreed date of
repayment subject to the record of the IOU, and the date of repayment for each
drawing shall not exceed the term of the said quota.

6.4 Where the loan hereunder may be used cyclically, the lender shall be
entitled to cancel the quota of the revolving loan if the borrower fails to
conduct any drawing for 3 consecutive months from the date of execution hereof.

 

Article 7 Guarantee

7.1 Except credit loans, the borrower shall provide the performance of its
obligations hereunder with a lawful and valid guarantee accepted by the lender.
A guarantee contract shall be signed separately.

7.2 The loan hereunder is a guaranteed (credit/guaranteed) loan.

7.3 Where the loan hereunder is a guaranteed loan, the guarantee manner is land
mortgage based on joint and several liability.

Where the guarantee is a maximum guarantee, the corresponding maximum guarantee
contract reads as follows:

Name of maximum guarantee contract: ______________ (No.: ________)

Surety (Pledgor/Mortgagor): ___________________________________________

7.4 In case the collateral hereunder is damaged, depreciates, suffers from
property right dispute, or is attached or detained, or the mortgagor disposes of
the collateral without authorization, or the surety securing the guarantee
encounters adverse change in financial position or any other change detrimental
to the lender, then the borrower shall promptly notify the lender and otherwise
provide another guarantee accepted by the lender.

 

 

 
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7.5 Where the loan hereunder is pledged with accounts receivable, in case of any
of the following circumstances within the term hereof, the lender shall be
entitled to announce early maturity of the loan and to require the borrower to
forthwith repay part or all of the principal and interest of the loan, or to add
any lawful, valid and sufficient guarantee accepted by the lender:

 

(1)

The bad debt ratio of the pledgor’s accounts receivable by the payer has
increased for 2 consecutive months;

 

(2)

The pledgor’s accounts receivable by the payer which have become due but have
not been collected take up more than _____% of the balance of such payer’s
accounts receivable;

 

(3)

The pledgor of the accounts receivable has trade dispute (including without
limited to dispute related to quality, technologies and services) or debt
dispute with the payer or any other third party, causing the accounts receivable
may fail to be repaid on time on the due date.

 

Article 8 Financial Agreement (as an optional clause, this article is ☐
applicable ☑ inapplicable)

Within the term hereof, the borrower shall abide by the following agreement on
financial indices:

______________________________________________________________________________

_______________________________________________________________________________

 

Article 9 Account Management

9.1 The borrower shall specially designate a capital receipt account at the
lender, which shall be used to receive corresponding sales incomes or to plan
the amount of repayment. Where such sales incomes are settled in a non-cash
manner, the borrower shall ensure that upon receipt thereof, such incomes will
be promptly transferred to the capital receipt account.

9.2 The lender is entitled to supervise the capital receipt account, including
without limited to understanding and overseeing the capital receipt and
expenditure thereof, and the borrower shall cooperate with the lender in this
respect. If required by the lender, the borrower shall specially sign an account
supervision agreement with the lender.

 

Article 10 Representations and Warranties

The borrower makes to the lender the following representations and warranties,
which remain always in force and effect within the term hereof:

10.1 The borrower has the qualification as a borrower according to law and has
the qualification and ability to sign and perform this Contract;

 

 

 
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10.2 All the authorizations or approvals necessary for the execution hereof have
been obtained, and the execution and performance hereof neither violate the
Company’s articles of association and relevant laws and regulations nor
contradict the obligations under other contracts that shall be assumed;

10.3 Other debts due and payable have been repaid on time and there is no
malicious default on the principal and interest of banking loans;

10.4 The borrower has a sound organization and a sound financial management
system and has never experienced any major violation of provisions or discipline
in the course of production and operation within the most recent year, and its
incumbent officers have no major bad records;

10.5 All the documents and materials provided to the lender are authentic,
accurate, complete and valid and do not contain false records, major omission or
misleading representations;

10.6 The financial accounting reports provided to the lender are prepared
according to China’s accounting standard and reflect truthfully, fairly and
completely the borrower’s operating status and liabilities, and since the ending
date of the latest financial accounting report, the borrower’s financial
position has never suffered any major adverse change; and

10.7 The borrower has never concealed any lawsuit, arbitration or claim related
to the borrower from the lender.

 

Article 11 Borrower’s Undertakings

11.1 The borrower will draw and use the loan according to the term and purpose
agreed herein and will not use the loan to invest in fixed assets or equity or
make the loan available in any way to securities markets, futures markets or
other purposes forbidden or restricted by relevant laws or regulations.

11.2 The borrower will repay the principal and interest of the loan and other
amounts payable under this Contract.

11.3 The borrower will accept and actively cooperate with the lender in
inspecting and overseeing the use of the loan, including the purpose thereof,
through account analysis, voucher inspection and on-site investigation, and will
regularly summarize and report the use of the loan as required by the lender.

11.4 The borrower will accept the lender’s credit check, and at the request of
the lender, provide such accounting materials as balance sheets and profit and
loss statements as well as other materials reflecting the borrower’s solvency,
and actively assist and cooperate with the lender in investigating,
understanding and overseeing the borrower’s production, operation and financial
position.

 

 

 
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11.5 Without the written consent of the lender, the borrower will in no way
distribute dividends or bonuses before fully repaying the principal and interest
of the loan hereunder and other accounts payable.

11.6 In case of any merger, division, capital reduction, equity change, transfer
of major assets and creditor’s rights, major external investment, substantial
increase in debt financing or any other action that may adversely affect the
lender’s rights and interests, the borrower will obtain the lender’s written
consent beforehand or make arrangements for the realization of the lender’s
creditor’s rights to the satisfaction of the lender before conducting any of the
said actions.

11.7 The borrower will promptly notify the lender if:

 

(1)

The Company’s articles of association, business scope, registered capital, or
legal representative changes;

 

(2)

The borrower goes out of business, is dissolved or liquidated, stops doing
business for internal rectification, or applies (or suffers application) for
bankruptcy, or its business license is revoked or canceled;

 

(3)

The borrower is or may be involved in any major economic dispute, lawsuit or
arbitration, or its property is attached, detained or supervised according to
law; or

 

(4)

The borrower’s shareholders, directors and/or incumbent officers are suspected
of involving in any major case or economic dispute.

11.8 The borrower will disclose promptly, comprehensively and accurately the
relationship with affiliated parties and any affiliated transactions to the
lender.

11.9 The borrower will promptly sign for various notices mailed by the lender or
otherwise served.

11.10 The borrower will not dispose of its own assets in such a manner as may
reduce its solvency; the borrower’s provision of a guarantee to a third party
will not damage the lender’s rights and interests.

11.11 If the loan hereunder is granted in a credit manner, the borrower will
regularly report its external guarantee to the lender completely, truthfully and
accurately and will sign an account supervision agreement as required by the
lender. Where the borrower’s provision of any external guarantee may affect the
performance of its obligations hereunder, such provision shall be subject to the
written consent of the lender.

11.12 The borrower will bear any expenses arising from the execution and
performance hereof and any expenses that have been paid and become due and
payable by the lender in order to realize the creditor’s rights hereunder,
including without limited to legal costs or arbitration cost, property
preservation expenses, attorney fees, enforcement fees, assessment fees, auction
expenses, and public announcement expenses.

11.13 The reimbursement order of the debt hereunder will prevail over that of
the debt owed to the borrower’s shareholders, and the debt hereunder will have a
status at least equal to that of the same type of debt owed by the borrower to
other creditors. 

 

 
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authority’s investigation according to law or limit the personal freedom, which
has affected or may affect the performance of obligations hereunder.

 

(8)

The borrower uses any false contract with any affiliated party or any
transaction without any actual transaction background to extract the lender’s
capital or credit extension, or intentionally escapes the lender’s creditor’s
rights through any affiliated transaction;

 

(9)

The borrower has or may gone or go out of business, been or be dissolved or
liquidated, stopped or stop doing business for internal rectification, or
applied or apply (or suffered or suffer application) for bankruptcy, or its
business license has been or may be revoked or canceled;

 

(10)

The borrower causes any responsibility accident owing to its violation of laws
and regulations, regulatory provisions or industry standards in respect of food
safety, production safety and environmental protection, which has affected or
may affect the performance of its obligations hereunder;

 

(11)

If the loan hereunder is granted in a credit manner, the creditor’s indices such
as credit rating, profitability, asset-liability ratio, and net cash flow from
operating fail to comply with the lender’s credit loan conditions; or without
the written consent of the lender, the borrower creates any mortgage/pledge or
provides any external security to others with its effective operating assets,
which has affected or may affect the performance of its obligations hereunder;

 

(12)

There occurs any other circumstance that may cause the realization of the
lender’s creditor’s rights hereunder to be affected adversely.

13.2 If the borrower breaches the Contract, the lender shall be entitled to take
one or more of the following measures:

 

(1)

To require the borrower to cure such breach within a time limit;

 

(2)

To stop granting the borrower the loan and other financing amounts under this
Contract and other contracts between the lender and the borrower, and to cancel
in part or in whole the loan and other financing amounts that the borrower fails
to draw;

 

(3)

To announce immediate maturity of the outstanding loan and other financing
amounts under this Contract and other contracts between the lender and the
borrower and to immediately resume the outstanding amounts;

 

(4)

To require the borrower to compensate the lender for any loss caused by the said
breach; and/or

 

(5)

To take other measures which are prescribed by laws and regulations, which are
agreed herein or which the lender thinks necessary.

13.3 Where the loan becomes mature (including being announced mature
immediately) but the borrower fails to repay the loan as agreed, the lender
shall be entitled to charge an interest penalty at the default interest rate
agreed herein from the date of default. The interest that the borrower fails to
pay on time shall be compounded at the default interest rate.

 

 

 
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13.4 Where the borrower fails to use the loan for the purpose agreed herein, the
lender shall be entitled to impose an interest penalty on the misappropriated
part at the interest rate of the interest penalty for the misappropriated loan
as agreed herein from the date of such misappropriation, and the interest that
fails to be paid during the misappropriation of the loan shall be compounded at
the interest rate of the interest penalty for the misappropriated loan.

13.5 Where both the circumstances set forth in the said Articles 13.3 and 13.4
occur to the borrower at the same time, the default interest rate or the
interest rate of the interest penalty, whichever is higher, shall apply,
provided that both rates shall not apply concurrently.

13.6 Where the borrower fails to repay on time the principal and interest
(including default interest, interest penalty and compound interest) of the loan
or other accounts payable, the lender shall be entitled to call such repayment
through public announcement on the media.

13.7 Where the relationship of control or being controlled between the
borrower’s affiliated party and the borrower changes, or the circumstances
specified in Article 13.1 other than in Articles 13.1(1) and (2) occur to the
borrower’s affiliated party, which has affected or may affect the performance of
the borrower’s obligations hereunder, the lender shall be entitled to take
various measures agreed herein.

 

Article 14 Deduction

14.1 Where the borrower fails to pay as agreed the debt hereunder that becomes
due and payable (including being announced due and payable immediately), the
lender shall be entitled to deduct a corresponding amount as a reimbursement
from all of the borrower’s RMB and foreign currency accounts opened with the
lender or its other branches until the whole of the borrower’s debt hereunder is
reimbursed in full.

14.2 Where the currency of any deduction is different from the currency
hereunder, the conversion thereof shall be made based on the exchange rate
applicable to the lender on the date of deduction. The borrower shall bear the
interest and other expenses incurred from the date of deduction until the date
of reimbursement (the date when the lender converts the deduction into the
currency hereunder according to national foreign exchange administration
policies and actually reimburses the debt hereunder) and the difference arising
from fluctuation in the exchange rate during such period.

14.3 Where the amount deducted by the lender is insufficient to reimburse the
whole of the borrower’s debt, the lender shall be entitled to decide the
reimbursement order.

 

 

 
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Article 15 Assignment of Rights and Obligations

15.1 The lender is entitled to assign all or part of its rights hereunder to a
third party and such assignment is not subject to the borrower’s consent.
Without the written consent of the lender, the borrower shall not assign any of
its rights and obligations hereunder.

15.2 The lender may, according to the operation and management need, authorize
or entrust any of its other branches to perform its rights and obligations
hereunder, or put the creditor’s rights of the loan hereunder under the takeover
and management of any of its other branches, which is accepted by the borrower
and is not subject to the borrower’s consent. The branch that takes over the
lender’s rights and obligations shall be entitled to exercise all the rights
hereunder and to in the name of the branch, file a lawsuit with the people’s
court, submit to arbitration or petition for enforcement with respect to the
dispute hereunder.

 

Article 16 Taking Effect, Modification and Cancellation

16.1 This Contract shall take effect on the date of execution and shall
terminate on the date when the performance of all of the borrower’s obligations
hereunder is completed.

16.2 Any modification hereto shall be agreed by the parties through negotiation
and shall be made in writing. The modification clause or agreement constitutes a
part hereof and has the same legal force and effect as this Contract. Except the
modified part, the remainder hereof shall remain in force and effect and so
shall the original clauses before the modified part takes effect.

16.3 No modification or cancellation hereof shall affect the contracting
parties’ rights to claim compensation for any loss. No cancellation hereof shall
affect the force and effect of the dispute resolution clause.

 

Article 17 Applicable Laws and Dispute Resolution

The execution, force and effect, interpretation, performance and dispute
resolution hereof shall be governed by the laws of the People’s Republic of
China. Any dispute or controversy arising from or in connection with this
Contract shall be resolved by both parties through negotiation; shall such
negotiation fail, it shall be resolved in the manner agreed herein.

 

 

 
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Article 18 Notices

18.1 All the notices hereunder shall be sent in writing. Unless otherwise
agreed, both parties’ designated domiciles as specified herein shall be the
mailing and contact addresses. Where either party changes its mailing address or
any other contact information, such party shall promptly notify the other party
in writing.

18.2 If either party hereto refuses to sign for any notice or any notice cannot
be served, the notifying party may serve such notice by means of notarization or
public announcement.

 

Article 19 Miscellaneous

19.1 The lender’s non-exercise or partial exercise of or delay in exercise of
any right hereunder shall not constitute any waiver or modification of such
right or any other right or affect its further exercise of such right or any
other right.

19.2 The invalidity or unenforceability of any clause hereof shall not affect
the validity and enforceability of the remaining clauses hereof or the force and
effect of the whole Contract.

19.3 The lender is entitled to, in accordance with the provisions of relevant
laws and regulations or the requirements of the financial regulatory authority,
provide the credit reference system of the People’s Bank of China and any other
legally established credit information database with any information on this
Contract and the borrower’s other relevant information for inquiry and use by
organizations or individuals with appropriate qualification. For the purpose of
the execution and performance hereof, the lender is also entitled to inquire
about the borrower’s relevant information through the credit reference system of
the People’s Bank of China and any other legally established credit information
database.

19.4 For the purpose hereof, such expressions as “affiliated parties”,
“relationship with affiliated parties”, “affiliated transaction”, “major
individual investor”, and “key management personnel” shall have the same meaning
of the same expressions in the Corporate Accounting Standard No. 36 – Disclosure
of Affiliated Parties (Cai Kuai [2006] No. 3) and any subsequent revision
thereof.

19.5 The documents and vouchers related to the loan hereunder which are prepared
and kept by the lender according to its business rules constitute valid evidence
proving the relationship between the borrower and the lender in respect of the
creditor’s rights and the debt and are legally binding upon the borrower.

19.6 For the purpose hereof, (1) any reference hereto includes any amendment or
supplement hereto; and (2) the clause headings are for reference only,
constituting neither any interpretation hereof nor any limitation to the
contents thereunder and the scope thereof.

 

 

 
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Article 20 Dispute Resolution

The dispute hereunder shall be settled in the following manner (2):

 

(1)

The dispute shall be submitted to __________________ Arbitration Commission for
arbitration according to its arbitration rules then in force and effect, and the
place of arbitration shall be ___________. The arbitration award shall be final
and binding upon both parties.

 

(2)

The dispute shall be resolved by filing a lawsuit with the court at the place
where the lender locates.

 

Article 21 Miscellaneous

21.1 This Contract is made in three copies, with the borrower, the lender and
Wu’an Municipal Bureau of Land and Resources each holding one copy, and all the
copies have the same legal force and effect.

21.2 The following appendices and other appendices jointly confirmed by both
parties constitute an integral part hereof and have the same legal force and
effect as this Contract.

Appendix 1: Drawing Application

Appendix 2:

Appendix 3:

 

 

Article 22 Other Matters Agreed by Both Parties

     

Article 5.4 is unenforceable for the time being.

 

 

 

 

 

 

 

 

 

 

 

 

 

 
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It is confirmed by both parties that both the borrower and the lender have fully
negotiated all the clauses hereof. The lender has reminded the borrower to pay
special attention to all the clauses related to both parties’ rights and
obligations and to have a comprehensive and accurate understanding thereof, and
has interpreted and explained relevant clauses at the request of the borrower.
The borrower has carefully read and fully understood all the clauses hereof, and
the borrower and the lender have a completely identical understanding of the
clauses hereof and have no objection to the contents hereof.

 

Lender (Official seal): [seal:] Bank of Handan Co., Ltd. Wu’an Sub-branch,
[1304810013252]

Person in charge/Authorized agent:
[signature]                                                   
                          

 

 

 

Borrower (Official seal): [seal:] Northern Altair Nanotechnologies Co., Ltd.,
[1304810017957]

Legal representative/Authorized agent:
[signature]                                              
                          

 

 

 

 

 

 

Signed on: August 27, 2013

 

 

 
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Appendix 1:

 

Drawing Application

 

 

To: Bank of Handan Co., Ltd. Wu’an Sub-branch

 

According to the Working Capital Loan Contract (hereinafter referred to as the
“Loan Contract) numbered xd201308213452 that was entered into by and between you
and us on August 27, 2013, we have comprehensively fulfilled all the
preconditions for drawing as agreed therein and hereby make the following
drawing application to you:

 

I.

We intend to draw from you the loan with an amount of RMB (currency) FIFTY
MILLION YUAN ONLY (in words) on September 23, 2013.

II.

The term of this loan is 12 months, ending on August 27, 2014.

III.

Please transfer this loan to our following account:

 

Account name: Northern Altair Nanotechnologies Co., Ltd.

 

Account number: 866350100100082672               

 

Bank of deposit: Bank of Handan Co., Ltd. Wu’an Sub-branch

IV.

According to the loan contract and the entrusted payment agreement, this loan
shall be paid by: ☑ entrusting the lender with payment; or ☐ the borrower’s
independent payment.

 

By entrusting the lender with payment, we authorize and entrust you to transfer
this loan to our account and then to pay the loan to the account of the
following payee in compliance with the purpose agreed in the Loan Contract:

 

Account name: Altair Nanotechnologies (China) Co., Ltd.

 

Account number: 674358611[8]49                    

 

Bank of deposit: Bank of China, Bonded Area Sub-branch

[If this loan needs to be paid to several payees, see the appendix for the list
of payees and accounts]

 V. We hereby confirm to you as follows:

1. This loan will be used for the purpose agreed in the Loan Contract;

 

 

 
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2.

On the date of sending such application and the date of drawing, all of our
representations, warranties and undertakings in the Loan Contract are still
authentic, accurate, complete and valid;

 

3.

As of the date of sending this Application, our production and operation as well
as financial and credit status have never suffered any major adverse change;

 

4.

On the date of sending this Application, there is no breach or anticipatory
breach under or in connection with the Loan Contract, and we further confirms
that no breach will occur or exist on the date of drawing; and

 

5.

This Application shall be irrevocable after being sent.

 

 

 

 

 

 

Borrower (Official seal): [seal:] Northern Altair Nanotechnologies Co., Ltd.,
[1304810017957]

Legal representative/Authorized agent:
[signature]                                                         
              

 

 

 

Date: September 23, 2013

 

 

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