Exhibit 10.20


 


Ref: BC2011080200000526


 


SPD BANK


 


Financing Agreement


 


SHANGHAI PUDONG DEVELOPMENT BANK


 



    	 



    	 



    

 


The Financing Agreement (as “Agreement”)
is made by and between Dalian Tongfa New Material Development Co., Ltd. (as “Client”) and Shanghai Pudong Development
Bank Dalian Branch (as “Financing Bank”)


 


Adhering to the principles of equality,
reciprocity, being law-abiding and self-willingness, two parties hereto agree as follow:


 


Section I General Terms and Conditions


1. Agreement means any documents or files
signed by both Client and Financing Bank within the limitation of financing agreement, including Change to Financing Agreement
(refer the form to Exhibit 1) and any subordinate financing documents, which should be deemed as part of and be read along with
the Agreement herein.


 


2. For the purpose of the Agreement, credit
Line means financing limitation (i) listed in the Financing Schedule under Section II, or (ii) specified under any effective Change
to Financing Agreement (whichever is later) signed by Client and Financing Bank. Client shall apply to Financing Bank for credit
loans within such limitation. Otherwise Financing Bank may refuse such application no matter the credit line has been touched.


 


Client shall pay commissions based on the
rate and way of payment agreed in Financing Schedule in according to the Agreement.


 


3. In case of any discrepancies between
the terms/conditions herein and the Financing Schedule, the Financing Schedule (including any Change to Financing Agreement entered
by Client and Financing Bank from time to time) shall prevail. If any subordinate financing documents signed hereby within the
limitation have discrepancies as opposed to the Agreement herein, the subordinate financing documents shall prevail regarding the
services involved.


 


In despite of the above-mentioned provision,
Financing Bank shall have right to terminate any credit line extended to Client or accelerate maturities of loans under any subordinate
documents by informing Client, as Financing Bank deems necessary to safeguard its creditor’s right. When Client is informed
regarding acceleration of maturity, Client shall reimburse loans immediately. For any letter of credit, letter of guarantee or
bank’s acceptance opened by Financing Bank as per Client’s application, Client shall replenish the related margin up
to 100% in no time.


 


4. In accordance with the Agreement herein
and any subordinate documents, Client may apply for the credit financing which Financing Bank may, but is not obligated to extend
(thereafter referred as “financing”). Forms of financing include short-term loans, discounted notes (agreed form of
interest payment included), promissory note (where Client as issuer and acceptor), factoring financing, letter of credit (domestic
L/C included), export bill, advance against import L/C, packing loan, advance against documentary collection, L/C opening (including
usance L/C and domestic L/C), L/G opening (including standby L/G), and bank’s acceptance opening. Please refer to Finance
Schedule for specific forms of financing.


 



    	 



    	 



    

 


5. For the purpose of Agreement herein,
subordinate financing documents include the following files signed by Client:


(a) current loan agreement and other files
signed by Client;


(b) note discount agreement and other files
signed by Client;


(c) promissory note agreement and other
files signed by Client;


(d) factoring financing application and
other files signed by Client;


(e) advance against export L/C, advance
against documentary collection and other files signed by Client;


(f) advance against import L/C and other
files signed by Client;


(g) packing loan agreement and other files
signed by Client;


(h) L/C opening agreement and other files
signed by Client;


(i) L/G opening and standby L/C; and


(j) bank’s acceptance agreement and
other files signed by Client.


 


Financing bank may from time to time revoke
any promissory loans to be extended to Client as per Agreement or subordinate documents, or commitment to open any documents subject
to Client’s requirement. However, Client shall not revoke or change any signed/filed application or agreement for financing
loans, otherwise shall bear the cost, expense and loss arising therefrom.


 


6. Filing. Client shall agree to file the
following documents or meet relevant criteria prior to signing the Agreement or at Financing Bank’s request. Nevertheless
Financing Bank shall have no obligation to verify the truth of the documents therein. The documents shall include:


(a) Client’s latest copy of articles
of incorporation and business license,


(b) Client’s board resolution that
authorizes Client to sign the Agreement and subordinate documents, provided that legal representative’s signing authority
is restricted by articles of incorporation.


(c) letter of authority issued by Client
to its authorized agent, and the signature copy of its agent,


(d) all the subordinate documents effectively
signed by Client at Financing Bank’s request,


(e) any loan origination date and opening
date of L/C, L/G or bank’s acceptance specified by Client shall be the operating business day of Financing Bank.


(f) any other documents and/or terms required
by Financing Bank from time to time.


 


7. Unless otherwise agreed, used Credit
Line means the amount of loans extended by Financing Bank as per the Agreement and subordinate documents, yet unpaid by Client,
plus the amount of bills opened at Client’s request, excluding any amount reimbursed by Client or its guarantor to Financing
Bank in form of cash (e.g. margin).


 



    	 



    	 



    

 


8. For the term of revolving credit line,
Client may continue to apply for using line of credit that is recovered after Client executes the liabilities hereunder, including
repaying loaned amount, replenishing 100% margin, or Financing Bank relieved of paying liability. Unless consented by Financing
Bank, installment credit line shall not be recovered after being used. Unless otherwise required, Financing Bank shall have right
to review status of Client and its collateral. Client passing the review may continue to use the credit line in next year. Financing
Bank may cancel such credit line for Client failing to pass who must cease using the unused and payable credit, in exception of
subordinate documents still in effect.


 


9. If the Agreement is backed by collaterals,
the collateral document shall be signed and in full force before Client applies for credit loans. If margin is required for opening
L/C, L/G, standby L/C, bank’s acceptance as per Financing Schedule, Client shall pay full margin before applying for such
opening. To apply for increasing credit line, Client shall add collaterals or urge guarantor to confirm such change and add more
collaterals.


 


10. In exception with law-required taxes
that must be withdrawn by Client when repaying loaned amount, Client shall pay full amount of loans hereunder without withdrawing
any deduction. Client shall, within fifteen days upon the said deduction subject to laws, furnish a complete set of tax certificates
with Financing Bank and pay extra equivalent to the amount of such deduction.


 


11. Representation and guarantees. Client
shall make following representation and guarantees as each time Financing Bank provides credit as per the Agreement and subordinate
documents.


(a) Client shall be registered subject
to China’s laws and regulations, excluding Hong Kong, Macaw and Taiwan. Additionally Client shall be authorized to sign the
Agreement and relevant documents, and have undertaken necessary activities to execute the Agreement in a lawful and effective way.


(b) Client by signing the Agreement and
performing the liabilities hereunder has not violated or will not violate any other signed contracts, documents, articles of incorporation,
applicable laws, regulations, orders, competent authority’s policies, resolution, decrees, nor will conflict with other liabilities
or arrangement borne by Client.


(c) Client, its any shareholder and affiliated
company isn’t involved into any proceedings or contingencies like liquidation, bankruptcy, shake-off, merger and acquisition,
spin-off, reorganization, winding-up, close-up or stop-off.


(d) Client is free from any civil, criminal
or administrative proceedings or similar arbitrations or contingencies that may pose significant impact.


(e) Client’s legal representative,
directors, supervisors or other senior officers, and any material assets of Client are free from events or contingencies like any
coercion, confiscation, detainment, freezing and inspection.


(f) Client represents that all the financial
sheets furnished by Client are subject to Chinese laws and regulations, reflecting its financial status in a truthful, complete
and fair manner. Client guarantees that all its or guarantor's materials, documents or files furnished to Financing Bank shall
be truthful, effective, accurate and complete without any omission or concealment;


 



    	 



    	 



    

 


(g) Client shall strictly abide by applicable
laws, regulations and business license throughout its operation. Client shall process the annual review in due time.


(h) Client guarantees that no other events
or contingencies may or will cast material interest adverse to Client's capability of executing the Agreement.


 


12. Commitment. Client shall make commitment
as follow:


(a) Client shall strictly follow and execute
each and any liability hereunder;


(b) Unless otherwise specified, Client
shall repay loaned amount or replenish 100% margin in a timely manner, in accordance with the Agreement and subordinate documents.
Client shall process, obtain and maintain effective the approvals, authority, registration and license required by applicable laws
and regulations, thus authorizing Client to sign and perform the obligations hereunder. Client shall provide the above-mentioned
approvals, authority, registration and license in no time as Financing Bank required.


(c) Having knowledge of being involved
into any legal proceeding, including criminal, civil, administrative or economic proceeding by which Client may be significantly
impacted, or having knowledge of Client's any important asset being coerced, confiscated, detained, frozen or under suspicion,
Client shall inform Financing Bank and explain relevant impact and adopted/planned countermeasures within five days (Financing
Bank's operation days) thereafter.


(d) Without obtaining Financing Bank's
written consent, Client shall be restricted to reimburse any liabilities of comparatively large sum or execute any liability as
guarantor, towards any third party in exception with Financing Bank.


(e) Client shall, prior to Financing Bank's
written consent, not incur any other liabilities or contingencies of comparatively large sum, nor intend to provide any liability
arrangement or senior guarantee to Client per se or any other third party.


(f) Unless Financing Bank extends approval
in written form, before fully performing the liabilities hereunder as of the date of signing the Agreement, Client shall promise
not to:


(i) be the subject of legal proceedings
including liquidation, shake-off, bankruptcy, acquisition, merger, spin-off, reorganization, stop-off, close-up and winding up;


(ii) sell, let, transfer, donate or dispose
any important asset in any form, unless required by normal operations;


(iii) change equity structure;


(iv) enter into any contracts or arrangements,
or assume any liabilities that may have significantly adverse interest.


(g) Client shall furnish other collaterals
required and approved by Financing Bank in a timely manner, provided that collaterals hereunder incur certain circumstances or
changes including (but not limited to ) guarantor involved into stop-off, shut-down, winding-up, bankruptcy, adverse impact to
its operation or financial position, legal proceeding, arbitration, business license being evicted, re-applied or revoked, its
legal representative, director, supervisors or senior officers involved into conviction, collaterals being devalued, confiscated
or probably decreased, or defaulting to revoke the collateral agreement.


 



    	 



    	 



    

 


(h) At Financing Bank's request, Client
shall process enforceable certifications with the notarization authority assigned by Financing Bank, and consequently bear expenses
arising therefrom and voluntarily accept such enforcement.


(i) Client shall from time to time give
notice to Financing Bank about any events that may impact its capability of performing the liabilities hereunder.


(j) Group Client's Special Guaranty (Applicable
to Group Client)


(i) Client shall timely report
any transaction accounting for 10% of actual fiduciary's net assets, including (a.) relationships among related parties, (b.) nature
and content of transaction, (c. ) price or percentage, (d.) pricing policy (including transaction without prices or very low price).


(ii) Financing bank shall have
right to revoke any unused credit line at discretion and retract part or whole of used credit or require Client to deposit 100%
margin, provided that actual fiduciary (a.) furnishes fake documents or conceal material financial information, (b.) alters use
of credit without Financing Bank's consent or uses credit to engage in illegal transactions, (c.) receives Financing Bank's loan
or credit by discounting or collateralizing the accounts receivables that are fake and fabricated by actual fiduciary and related
party, (d.) refuses any inspection or review from Financing Bank regarding credit usage or financial position, (e.) incurs material
events like merger and acquisition that Financing Bank deems probable to threaten the safety of credit, and (f.) intentionally
escapes from its liabilities to Financing Bank through related transaction.


 


13. Expense and Cost. Client shall, at
Financing Bank's request, reimburse Financing Bank's expenses arising from amendment, signing, enforcement, notarization, registration
and others in connection with the Agreement or related documents, in a quick manner. In exception with the tax expense paid by
Financing Bank under laws and regulations, Client shall bear stamp tax and other tax expenses under the Agreement and related documents.


 


14. Penalty rate on delayed payment or
altering use of RMB-denominated loan shall be specified under Financing Schedule upon parties hereto agree, and penalty calculation
and collection subject to regulations of People's Bank. For foreign currency-denominated credit, penalty-related rate and its calculation/collection
shall be agreed by both parties, specified under Financing Schedule and by under subordinate documents respectively.


 


15. Currency Exchange. When loan currency
and credit line currency are different, Financing Bank shall have right to determine the exchange rate at its discretion. Additionally
Financing Bank shall be entitled to require Client to immediately pay the excess amount calculated as difference between used credit
line and the above-mentioned maximum credit line due to exchange rate volatility. If Client's payment and credit line are denominated
in different currencies, Financing Bank shall have right to specify exchange rate at discretion, thus exchange rate risk being
borne by Client.


 



    	 



    	 



    

 


16. Proxy Payment and Elimination


Client shall thereby authorize Financing
Bank to represent Client to repay any outstanding liabilities, whether under the Agreement or subordinate documents, from Client's
bank accounts (regardless of currency type) opened in Financing Bank. Such proxy shall be irrevocable. If any exchange rate is
involved, Financing Bank shall calculate based on exchange rate determined at discretion, thus exchange rate risk being borne by
Client.


 


17. Bank Statement


Financing Bank shall abide by its practical
standards to set up a accounting ledger and records related to all the activities herein. Unless there are obvious errors, Client
shall agree that such ledger and records are the effective proof to Client's debt status.


 


18. Transaction


Client shall not transfer any rights or
obligations hereunder. But Financing Bank may transfer its rights or obligations hereunder and disclose any related information,
including information provided by Client and Client's Guarantor for the purpose of the Agreement herein, to any other third party
from time to time.


 


19. Disclosure


Client agrees that in addition to information
disclosed subject to Clause18, Financing Bank may also disclose any relevant information to its headquarters, branches, affiliations
and employees those organization retained. Meanwhile, any disclosure by Financing Bank in accordance with laws, regulations and
requirements by governments, jurisdiction bodies or supervision authorities shall be allowed.


 


20. Default


If Client defaults the Agreement and subordinate
documents including (a.) any violation of representations and guarantees hereunder, or such representation or guarantee is proved
to be untruthful, fraudulent, omitted, misleading or violated, and/or (b.) violation or nonfulfillment of any commitment hereunder,
and/or (c.) breaching any provision(s) under the Agreement or any subordinate document hereunder, and/or (d.) incurrence of adverse
circumstances that may threaten safety of loans, and/or (e.) guarantor's violation of any collateral-related documents, Financing
Bank shall, in addition to any damages, expenses and attorney fees arising, be entitled (but not obligated) to taking following
measures as whole or separately:


(a) adjusting or canceling any credit line
hereunder;


(b) announcing acceleration of maturity
regarding whole or part of liabilities under subordinate documents, and requiring Client to repay whole of principal and interest
in no time. For acceptable notes, L/C, L/G or standby L/C below credit line, Financing Bank may require Client to add margin or
transfer Client's deposit or deposit in settlement account to its margin account, held against any payment or margin advance in
the future. If Financing Bank has incurred margin advance for Client, Financing Bank shall have right to ask for repayment immediately.


 



    	 



    	 



    

 


(c) calculating penalty as per agreed penalty
rate under Agreement or subordinate documents, and outstanding penalty interest shall be compounded.


(d) deducting any deposits in Client's
accounts opened in Financing Bank as per Clause16 hereunder.


 


21. Other


Unsettled subject under the Financing Agreement
referred to ED750010000509 shall be bound by the Agreement. Such unsettled subject is deemed used line of credit.


 


22. Governing Laws and Jurisdiction


The Agreement herein is governed and interpreted
by laws of Peoples' Republic of China (excluding regions of Hong Kong, Macaw and Taiwan). Any disputes arising herefrom shall be
solved under the exclusive jurisdiction of the court where Financing Bank is located.


 


23. Force Majeure


Force majeure means the unpredictable,
inevitable and unstoppable situations, including but not limited to natural disasters, earthquakes, tornado, flood, fire, wars,
riot, epidemic diseases, government manipulation, strike, stopoff, blackout, communication failure, internet system malfunction/breaking
down, system and equipment malfunction. The party with the knowledge of force majeure should inform the other party in a early
manner. Two parties shall work together to solve the problems, however the suffering party is not obligated under such occasion.


 


24. Service. Client confirms that legal
instruments such as subpoena or notice regarding any proceedings hereunder shall be deemed serviced as long as such instruments
are delivered to the addresses firstly set above. Any change to such addresses without notifying Financing Bank shall not be deemed
effective.


 


25. Notices or other communications required
to be given by one party pursuant to this Agreement shall be in written form to the address of the other party set above. The dates
on such notices from Financing Bank shall be deemed to have been effective given shall be determined as follows: (a.)Notices sent
by courier shall be deemed effective given on the seventh day after they were sent by courier service; (b.)by personal delivery,
on the date of personal delivery , provided that receipt shall be acknowledged in writing by the receiving party; (c.) by facsimile
transmission or email, on the date of transmission.


However, any notices, requests or other
communications issued to Financing Bank shall be deemed serviced provided that Financing Bank has acknowledged the acceptation.
In case of giving notices and requests by facsimile transmission or email, Client must deliver the original copy attached with
seal personally or by courier to confirm.


 


26. Severability


If any provision under the Agreement or
any subordinate document shall be held invalid, illegal or unenforceable, the validity and enforceability of the remaining shall
not be affected.


 



    	 



    	 



    

 


27. Grace Period


Financing Bank's extending grace period
or delaying taking any measures against Client's default shall not (i) injure, impact or restrict Financing Bank's any rights and
interests as a creditor, not (ii) be construed as Financing Bank's approval for Client's default, nor (iii) be deemed as Financing
Bank relinquishes any rights to take any measures against Client's current or possible default in future.


 


28. Effectiveness. The Agreement shall
enter into full force as of the date the Agreement signed and attached seals by parties hereto, and signed or attached seals by
legal representatives or agents thereof. The Agreement continues to be effective unless Financing Bank revokes whole of credit
line and Client has no obligations of reimbursement or rights of financing hereunder.


 


29. The Agreement is made in duplicates,
each having equal legal force.


 


The blank is left intentionally.


 



    	 



    	 



    

 


Financing Schedule


 


Name of Client: Dalian Tongfa New
Material Development Co., Ltd.


 


Line of Credit (Currency): RMB Twenty
Million Only


 


Term: as of August 5th
2011 to August 1st 2012


 


If revolving line of credit: Yes


 


Guarantor: Dalian Tongfa New Material
Development Co., Ltd.


 


Type of Guarantee: Collateralization


 


Penalty Rate for Delayed Payment : daily
rate + 50%


 


Penalty Rate for Altering Use of Credit
Line: daily rate + 100%


 


Type of Financing: factoring with credit
line twenty million RMB only, interest rate based on half-year benchmark interest rate + 20%. The longest maturity of a single
loan shall not exceed 180, with 30-day grace period.


 



    	 



    	 



    

 


The Financing Agreement herein is signed
by parties hereunder on August 5th 2011. Client agrees that parties hereto have fully discussed each and every terms
herein and correctly understood meanings of their rights, liabilities and exemptions, when signing the Agreement.


 


	Client: (Seal)	 	Shanghai Pudong Development Bank (Seal)
	/s/ Chuan Tao Zheng	 	 /s/ Xin Hao Wang
	Legal Representative:	 	Legal Representative: