Exhibit 10.6
 
ABC (2013) 3001
 
Contract on Import L/C Issuing limits
 
Contract No.: 12040220130000863
 
Dear clients, to protect your rights and interests, please read carefully the
terms and conditions of this contract (especially the terms and conditions in
bold letters) before signing to understand your rights and obligations
hereunder. If you have any doubt or question, please consult your bank.
 
Party A (full name): Tianjin Binhai Shisheng Business and Trade Group Co. , Ltd.
 
Party B (full name): Agricultural Bank of China Tianjin Heping Sub-branch
 
Party A hereby applies to Party B for issuing of reciprocal credit owing to the
import need, and agrees to make sufficient deposit of external payment within
the agreed time limit prior to such external payment. Party A and Party B hereby
enter into this Contract upon unanimous negotiation.
 
Article 1  For the purpose of this Contract, limits refer to the sum of balance
of issuable letter of credit as agreed in this Contract provided by Party B to
Party A. The issuing of letter or credit under this Contract (“L/C Issuing”)
includes the issuing and amendment of the letter of credit.
 
Article 2  Limits and Use Period
 
2.1
The limits for L/C issuing under this Contract (currency and amount in words):
Five Hundred and Twenty Million Yuan Only (RMB).

 
2.2
Use Period: from September 26th, 2013 to September 30th, 2014. The issuing date
and maturity date of each L/C issuing business that may occur during this period
shall be subject to the date as recorded in relevant vouchers filled out in
occurrence thereof. The maturity date of each L/C issuing business (inclusive of
L/C maturity date and Party B’s external payment date) shall survive the
maturity of this use period.

 
 
 

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Article 3  Use of Limits
 
3.1
Where Party A needs to use the L/C issuing limits under this Contract within the
limits and use period as agreed upon in this Contract, Party A shall furnish to
Party B the Application for Issuing of Irrevocable Documentary L/C / Commitment
of L/C Applicant for each business involved, and Party B shall have the right to
make decision on whether or not to issue L/C upon consideration of its financial
situation and upon inspection of Party A’s operation status as per related rules
and regulations.

 
3.2
Party A shall pay to Party B an amount at 15% of the L/C issuing amount as
deposit upon Party A’s issuing of each L/C. Where otherwise stipulated in the
Application for Issuing of Irrevocable Documentary L/C / Commitment of L/C
Applicant at issuing of each letter of credit, such stipulations shall be
observed and followed.

 
3.3
Where the use period expires, limits unused shall automatically be cancelled,
and Party A shall not reapply for use.

 
3.4
Except otherwise agreed by two parties hereto, they shall not separately enter
into the Import L/C Issuing Contract when L/C issuing limits hereunder are used
for L/C issuing.

 
3.5
Any subsequent financing if required with respect to the L/C issued hereunder
shall be subject to separate application, and shall be included in the separate
contract and guarantee contract upon Party B’s approval. The part not settled
with the above-mentioned subsequent financing shall be deemed to have used the
L/C issuing limits of this Contract.

 
Article 4  Party B may not deal with the L/C issuing business hereunder should
the following conditions be satisfied:
 
4.1
Party A has opened a general bank account with Party B.

 
4.2
For individual business, Party A has furnished to Party B the Application for
Issuing of Irrevocable Documentary L/C / Commitment of L/C Applicant and other
relevant information and acquired Party B’s approval and consent.

 
4.3
Party A, upon Party B’s request, has provided related documents and data,
acquired related approvals, handled registrations and gone through other legal
procedures for L/C issuing hereunder in accordance with pertinent regulations.

 
4.4
Party A has executed the guarantee contract if guarantee is required for L/C
issuing hereunder; Party A, upon Party B’s request, has properly gone through
legal procedures for registration and/or insurance should mortgage or pledge be
required for L/C issuing hereunder, and such guarantee and insurance shall
continue in force.

 
 
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Article 5  Party A’s Rights and Obligations
 
5.1
Party A shall have the right to apply for and deal with the issuing of letter of
credit in accordance with provisions of this Contract.

 
5.2
Party A shall provide Party B with the financial statements (including balance
sheet, income statement) and all related information and data (name of deposit
bank, account No. and deposit balance) that are true, complete and valid on the
monthly (monthly) basis. Party A shall timely provide true and valid import
contract and related information in accordance with the requirements of Party B,
which shall be subject to the examination and supervision of Party B.

 
5.3
Party A shall deal with the business conducted in RMB and foreign currencies
under this Contract through the bank account opened with Party B.

 
5.4
Party A shall properly go through legal procedures and procedures for
administrative inspection and approval necessary for the import, L/C issuing and
performance of this Contract.

 
5.5
Party A shall pay in full the L/C issuing deposit as indicated in this Contract.
Except otherwise agreed in the Application for Issuing of Irrevocable
Documentary L/C / Commitment of L/C Applicant, Party A shall pay in full the L/C
issuing deposit. If the currency used for deposit payment and the currency
stated on the L/C are not the same, Party A is willing to bear the risk of
changes in exchange rates. If the paid deposit becomes insufficient due to
exchange rate movements before payment by the L/C, Party A shall timely make up
the gap.

 
5.6
Party A shall open and modify the L/C in accordance with Uniform Customs and
Practice for Documentary Credits (ICC Publication No. 600), Irrevocable L/C
Application, L/C Modification Application and the requirements of the contract,
and shall bear all responsibilities arising therefrom.

 
5.7
Irrevocable L/C Application and L/C Modification Application and attachments
shall be filled out in English. Party B shall not be liable for any consequence
from illegible handwriting or ambiguous meaning, or the ambiguity caused by
filling in the form in Chinese.

 
5.8
Party A shall timely check the copy of the L/C or its amendment upon receipt of
the L/C or its amendment from Party B. In case of any discrepancy, Party A shall
notify Party B in written within two working days upon receipt of the copy;
otherwise, the L/C or its amendment shall be regarded as correct.

 
5.9
Where sight L/C is issued, Party A shall deposit in full the amount under the
letter of credit into the bank account nominated by Party B for Party B’s future
payment within two (2) working days upon Party B’s delivery of the Notice for
External Payment/Acceptance or the Notice for Domestic Payment / Acceptance,; if
time L/C is issued, Party A shall deposit in full the amount under the letter of
credit into the bank account nominated by Party B for Party B’s external payment
three (3) working days before the maturity of the acceptance or commitment.
Party A shall make payments under the L/C within the period as required by Party
B, including the amount of the L/C, the receivable handling fee and other
related expenses, like bank charges disclaimed by foreign beneficiary. Party A
shall unconditionally and fully bear the debt, interest, and cost resulting from
any form of advance payment, if any, in accordance with the contract, and shall
timely provide compensation as required by Party B.

 
 
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5.10
Party A shall notify Party B in written to go through foreign payment /
acceptance / confirmation of extension of payment date / dishonor procedure
within the period as stipulated in Foreign Payment / Acceptance Notice or
Domestic Payment / Acceptance Notice. Otherwise, Party B shall have the right to
make its own determination on foreign payment / acceptance / confirmation of
extension of payment date / dishonor, and Party A shall take full responsibility
for the consequences.

 
5.11
For usance bill accepted by Party B or deferred payment confirmed by Party B,
Party A has no right to require Party B to stop payment.

 
5.12
Where the L/C issuing limits already used exceed the L/C issuing limits agreed
upon in this Contract due to fluctuation of the exchange rate before the
maturity of each L/C under this Contract, Party A shall immediately return the
exceeding part or pay corresponding deposit.

 
5.13
Party A shall notify Party B in writing of the occurrence of the following
events and take assets preservation measures acceptable to Party B within five
(5) days thereafter:

 

 
(1)
the change of its subordination relationship and senior officials as well as the
amendment of its articles of association and the adjustment of its organization
structure.

 

 
(2)
shutdown, stoppage, deregistration, or revocation of its business license or
being applied for bankruptcy.

 

 
(3)
worsening of financial status, suffering of serious difficulties in operations,
or being involved in material litigation or arbitration.

 

 
(4)
the change of its name, domicile, legal representative, contact information and
other particulars.

 

 
(5)
occurrence of any other events which would adversely affect Party B’s
realization of its creditor’s right.

 
5.14
Party A shall obtain Party B’s consent and implement debt-paying measures
acceptable to Party B prior to the conducting of any of the following
activities:

 

 
(1)
Party A engages in contracting, leasing, shareholding reform, joint operation,
consolidation, merger, division, joint venture, transfer of assets, reduction of
registered capital, and application for rectification, dissolution or
bankruptcy, as well as other activities that have good chance to cause change in
the creditor-debtor relationship of this Contract or to influence Party B’s
realization of its creditor’s right;

 

 
(2)
Party A provides guarantee with respect to the liabilities of other parties, or
mortgages or pledges its major assets to any third party, which might affect its
solvency hereunder.

 
5.15
Party A and its investors shall not withdraw funds, transfer assets, or assign
shares in order to evade their liabilities to Party B.

 
 
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5.16
In case of shutdown, stoppage, deregistration, revocation of business license,
bankruptcy or operation loss of the guarantor hereunder, resulting in guarantee
inability or partial guarantee ability in relation thereto, or in depreciation
of guaranty, pledge or pledge right used for guaranteeing this Contract, Party A
shall immediately pay in full the L/C issuance finance deposit for the letter of
credit issued under this Contract, or provide other forms of guarantee
acceptable to Party B.

 
5.17
Party A shall not enter into any contract with any third party that may
prejudice Party B’s rights and interests hereunder.

 
Article 6  Party B’s Rights and Obligations
 
6.1
Party B shall issue the letter of credit to Party A in case Party A has properly
performed the agreed obligations hereunder, gone through required procedures and
satisfied Party B’s inspection requirements.

 
6.2
Party B shall be entitled to familiarize with Party A’s operations, financial
activities, L/C utilization and other situations, and request Party A to furnish
the financial statements and other documents, information and data within time
limit.

 
6.3
To modify the L/C, Party A shall submit a written application to Party B. Party
B shall have the right to determine whether the modification is applicable based
on the specific circumstances. No modification to the L/C shall take effect
until it is accepted by the beneficiary.

 
6.4
If Party A intends to refuse payment / acceptance / confirmation of extension of
payment date as a result of any discrepancy between the bill and the L/C, Party
A shall provide Party B with a written notice of dishonor, listing all
discrepancies, within the period as stipulated in Foreign Payment / Acceptance
Notice or Domestic Payment / Acceptance Notice. Party B shall have the right to
an independent review of the discrepancies, and Party B’s conclusion and
handling practice shall be final. If Party B determines that the discrepancy
claimed by Party A is not eligible for dishonor after review in accordance with
the international practice, Party B shall be entitled to take the initiative to
make foreign payment / acceptance / confirmation of extension of payment date,
and Party A agrees to give up its right of defense.

 
6.5
Party B shall not assume any responsibility for the consequences from loss,
delay, error or omission in mailing / telecommunication process.

 
6.6
In case (including but without limitation) circumstances listed in Item 13, Item
14 and Item 15 of Article 5 of this Contract happen, which may adversely
influence Party B’s realization of its creditor’s right, Party B shall have the
right to request Party A’s full payment of the L/C issuance finance deposit for
the issued letter of credit under this Contract, or take other assets
preservation measures.

 
 
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6.7
When making foreign payment, Party B shall have the right to take the initiative
to pay the money directly from Party A’s account opened at Party B. Where Party
A fails to make deposit in full and in a timely manner according to the Article
5 of this Contract, Party B shall be entitled to deduct the principals and
interests on the amounts early paid for Party A and other expenses payable by
Party A directly from any of Party A’s bank accounts as per the provisions of
this Contract, and the liabilities offset and offset sequence shall be
determined by Party B. In case Party B executes its right of offset pursuant to
the legal rules or provisions of this Contract, Party A may raise objection
thereto within seven (7) working days from the date on which Party B notifies
Party A of such execution in writing, orally or by other means.

 
6.8
In case of advance payment, and the repayments by Party A is insufficient to
cover the payables under this Contract, Party B may choose to pay back the
principals, interests or expenses on such advance payment with such repayments.

 
6.9
Where there’s more than one matured liability between Party A and Party B, and
Party A’s repayments are insufficient to cover all matured liabilities, the
liabilities to be settled with Party A’s repayments and the settlement sequence
shall be determined by Party B.

 
6.10
Where Party A fails to perform the repayment obligation, Party B may disclose
such failure to the public.

 
Article 7  Liabilities for Breach of the Contract
 
7.1
Where Party B violates the obligations specified in the Article 6 of this
Contract, Party B, besides continuing performance of this Contract, shall assume
liabilities in relation thereto according to law.

 
7.2
Where Party A fails to perform the payment obligation and Party B thus pays for
Party A, the amount paid by Party B for Party A shall be considered overdue
loan, and interest thereon shall be calculated by the following method (2) from
the date of such payment:

 

 
(1)
at         /10000 (in words) of daily interest rate before actual payment.

 

 
(2)
at 50% (in words) of (LIBOR (LIBOR / HIBOR) + 1%) of three (3) months from the
date of advance payment. LIBOR refers to London Interbank Offered Rate, and
HIBOR refers to Hong Kong Interbank Offer Rate.

 
Party B shall repay the advance payments / financing amounts and overdue
interests in the original currency in which letter of credit was issued.
 
7.3
Where Party A, in violation of the agreed obligations hereunder, has not issued
the letter of credit yet, Party B shall be entitled to refuse to issue the
letter of credit; where Party B has issued the letter of credit, Party A shall
promptly pay in full the L/C issuance finance deposit with respect to the issued
L/C. However, in the event that Party A fails to do so within the indicated
period, Party B shall be entitled to charge penalty at 5/10000 (in words) of the
portion yet to be paid.

 
 
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7.4
Where Party A violates the agreed obligations under this Contract, Party B shall
have the right to request Party A to correct such violation within the time
limit, cease the issuing of letter of credit, and announce immediate expiration
of liabilities under other contracts entered into with Party B, or take other
assets preservation measures.

 
7.5
Where any of guarantors under this Contract breaches against the agreed
obligations under the guarantee contract, Party B may cease issuing of letter of
credit to Party A, and request Party A to immediately pay in full the L/C
issuance finance deposit for the issued letter of credit under this Contract, or
take other assets preservation measures.

 
7.6
Where Party B has to realize its creditor’s right by way of litigation or
arbitration due to Party A’s violation of this Contract, Party A shall assume
the legal fees, travel expenses and other related fees paid by Party B
therefore.

 
Article 8  Special Agreement on Issuance of Nominal Forward L/C
 
8.1
Party B shall, upon Party A’s request, issue the forward L/C and promptly make
external payment, or if the paying bank is notified to make external payment,
Party B shall be deemed to have agreed to provide financing to Party A.

 
8.2
The financing period shall be from the payment date of Party B / paying bank to
the maturity date of draft / document. Party A undertakes to unconditionally
undertake payment responsibility to Party B on the maturity date of draft /
document and pay back all principals and interests on financing under the letter
of credit. Where Party A fails to make payment by due time, resulting in delayed
financing, the interest shall be calculated thereafter according to the
provisions of Item 2 of Article 7 herein.

 
8.3
The financing interest shall be calculated by multiplying financing interest
rate, financing period and financing amount. The financing interest rate shall
be subject to that specified in relevant vouchers.

 
8.4
Party A’s early repayment of the financing amount shall be subject to Party B’s
consent. Where the paying bank is not what mentioned herein, Party A shall
assume related commissions and / or penalty interests required for early
repayment.

 
8.5
Party A undertakes to waive its right of application to the court of law and
other related departments for stopping or freezing payment of amounts under the
nominal forward L/C.

 
Article 9  Guarantee
 
 
The creditor’s right under this Contract shall be guaranteed by execution of the
Maximum Guarantee Contract, which shall be separately signed. If the Maximum
Guarantee Contract is executed, the guarantee contract No. is 12100520130000131,
12100520130000132.

 
 
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Article 10  Dispute Settlement
 
Any dispute arising out of the performance of this Contract may be settled
through consultation or through the following method 10.1:
 
10.1
Litigation. Such dispute shall be governed by the people’s court at the domicile
of Party B.

 
10.2
Arbitration. A request may be filed with _____ (full name of the arbitration
institution) for arbitral award in accordance with the then effective
arbitration rules.

 
 
The performance of the remaining provisions herein not involved in the dispute
shall continue during arbitration or litigation.

 
Article 11  Miscellaneous
 
11.1
The Application for Issuing of Irrevocable Documentary L/C and the Application
for Amendment to Letter of Credit, advance payment voucher and etc. in relation
to this Contract shall be an integral part of this Contract.

 
11.2
The amount of deposit for individual business within the limits hereunder is the
amount in RMB after conversion at the then effective foreign exchange rate or
actual foreign amount. The applicant shall pay off related liabilities hereunder
after conversion at the foreign exchange rate of payment date when it makes
payment in accordance with this Contract.

 
11.3
The Applicant Tianjin Binhai Shisheng Business and Trade Group Co., Ltd. shall
early inform our bank of any intent to apply for financing from other financial
institutions.

 
Article 12  Effectiveness of the Contract
 
This Contract shall come into effect upon signature and stamp by the parties
hereto.
 
Article 13  This Contract is made in four copies with equal validity. Party A,
Party B and the Guarantor shall hold one copy thereof respectively.
 
Party A’s Declaration: Party B has informed us of relevant terms and conditions
(especially the terms and conditions in bold letter) according to law, and has
explained the concept, content and legal effect of relevant provisions upon our
request. We have been aware of and understanding the above-mentioned provisions.
 

Party A (signature and seal)      Party B:  (signature and seal)  

 
 
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[img1.jpg]     [img2.jpg]            
Legal Representative or Authorized Agent:
    Responsible Person or Authorized Agent:             [img3.jpg]    
[img4.jpg]            
Signing Date: September 26, 2013
   
Signing Date: September 26, 2013
           
Signed at: No. 54, Machang Road, Heping District, Tianjin
   
Signed at: No. 54, Machang Road, Heping District, Tianjin
 

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