Document Code: CMBC-HT-363 (2011 Company
Version)


 













 


SME Financial Service Contract


(Appropriate for working capital loans)


Code: Public Debt #99012012296402




 





















 


China Minsheng Bank


 






    	 



    	 	



    
 


Contract Parties


 


 


 


Borrower: Beijing Wowjoint Machinery
Co. Ltd.


Address: 1108 A Block Tiancheng Mansion,
2# Xinfeng Road Deshengmenwai Street, Xicheng District, Beijing, P.R. China


Zip code: 100088


Legal representative/Responsible Person:
Liu Yabin                 


Telephone: 89579330


Fax: 89579553                               
  


                               


 


Party B: China
Minsheng Bank, Headquarter Branch Sales Department


Address: No 2 Fuxingmennei Street, Xicheng
District, Beijing, P.R. China


Zip code: 100031


Legal representative/Responsible Person:
Chen Jinzhong


Telephone: 58560088                                
 


Fax: 58560001                                
 


 


Both parties in accordance with relevant
state laws and regulations enter into this contract.


 






    	 



    	 	



    
 





Working Capital Loan Terms


 


Section 1: Loan purpose 


 


Article 1: The loan purpose
under the Contract is for: working capital for daily production and operation. Without the written consent of Party
B, Party A shall not change the loan purpose. 


 


Section 2: Loan amount and
terms 


 


Article 2: The loan amount
is 5 million. Currency is RMB. The above Loan amount refers to:


 


ý
Revolving line of credit under Integrated Credit Line, and credit terms are the same as the terms for the maximum credit amount.
Each loan terms shall conform to the terms on the Borrowing Certificate.


 


If Party A has signed the "Contract
for Joint Guarantee Credit", the validity, category and code number are           
  , which shall conform to those in the "Contract for Joint Guarantee Credit". Each loan terms shall
conform to the terms on the Borrowing Certificate. 


 


ý
Revolving line of credit under Non-Integrated Credit Line. Credit terms shall be from     Year     Month     Date
to     Year     Month     Date.
Each loan terms shall conform to the terms on the Borrowing Certificate.


 


þ
Single loan, is not a revolving credit line, the loan period from 2012.03.14 (the
first agreed loan drawdown date) to 2012.09.14 (the agreed loan maturity date). If the above dates are not
the same as those on the Borrowing Certificate, the dates on the Borrowing Certificate shall prevail.


 


Article 3: If the borrowing is drawn
under a revolving line of credit of Integrated Credit Line or Non-Integrated Credit Line, within the loan period and loan amount
limits Party A can apply for re-drawing of the repaid amount after obtaining approval from Party B. If Party A defaults, Party
B shall have the right to cancel any unused credit line. Once the line of credit expires, the unused amount is automatically cancelled. Party
A must apply for loan drawdown within the validity period, and the start date of each drawdown shall not exceed the last date of
the validity period. If validity period is adjusted, the last date of the validity period shall be adjusted accordingly. Prior
to each application for drawdown, Party A shall __ Business days in advance submit to Party B "Withdrawal / Payment
Application." After receipt of such application Party B shall decide whether to grant loans and notify Party B accordingly.


 


Section 3: Interest calculation 


 






    	 



    	 	



    
 


Article 4: Interest rates calculation


 


(A) ý
The annual loan interest rate is        %. The annual interest
rate is calculated using the applicable benchmark lending rate over the same period as published by the People's Bank of China
on the date of the Contract signing, plus a pre-determined floating rate.


 


þ
The annual loan interest rate is 7.93%, which
is the applicable benchmark lending rate over the same period as published by the People's Bank of China on the date of the Contract
signing þfloating
upward ýfloating
downward by 30%.


 


If the agreed interest rate and the actual
interest rate are different, the interest rate on the Borrowing Certificate shall prevail.


 


(B) Interest calculation should start
from the date Party B transfers the loan funds in accordance with Article 7, 8 and 9 in the Contract to the account, which Party
A opens at Party B’s branch. Party A shall pay to Party B on interest settlement date interest and principal payment due
from the drawdown date or last interest settlement date to this interest settlement date.


 


(C) Loan interest calculation and
interest settlement period:


 


þ Daily
accrual, monthly interest settlement, interest settlement date is the 20th day of each month, but the last interest
settlement date is the loan maturity date.


 


ý Daily
accrual, quarterly interest settlement, interest settlement date is the 20th day of each quarter or _____ date, but
the last interest settlement date is the loan maturity date.


 


ý If
the loan is less than one year, interest together with principal is paid on maturity date.


 


(D) For overdue loan principal, Party
B shall calculate overdue penalty interest at normal interest rate increased by 50%, starting from the first overdue
date. Party B shall calculate normal interest and overdue penalty interest monthly on the interest settlement date, based on the
actual number of days overdue and accrued monthly.


 


(E) If Party A uses loans not in accordance
with agreed loan purposes, Party B shall calculate default penalty interest at normal interest rate increased by 100%,
starting from the first default date (inclusive). Party B shall calculate normal interest and default penalty interest monthly
on the interest settlement date, based on the actual number of days overdue and accrued monthly. Party B shall reserve the right
to pursue Party A’s liabilities resulting from other breaches of contract and declare at any time all or part of the outstanding
loans due immediately.


 


(F) After loan drawdown, if the People's
Bank of China adjusts the benchmark lending interest rates, the loan interest rate shall be adjusted with the following methods:


 






    	 



    	 	



    
 


ý Not
be adjusted.


 


þ Automatically
adjusted using the new benchmark lending interest rates plus agreed floating rate in accordance with Article 4, Paragraph (A) of
the Contract. For the loan which has already been drawn down, the newly adjusted loan interest rate shall start to apply on the
next day after the first interest rate settlement date following the adjustment date of the benchmark lending rates.


 


Once the normal loan interest rate is adjusted,
the overdue penalty interest rate and the default penalty interest rate shall automatically adjust accordingly, and shall begin
to apply at the same time by period.


 


If the interest rate is adjusted in accordance
with Article 4, Paragraph (F), there is no need for both parties to sign an agreement, and no need to notify or seek consent of
the other party or the guarantor.


 


ý Other
interest rate adjustment method:                                                       


 


Section 4: Loan drawdown and payment 


 


Article 5: After this
contract takes effect, Party A shall drawdown loans using the following method:


 


þ One-time drawdown of all loans under this contract;


 


ý Draw
down working capital loans in phases in accordance with the terms of the agreement in Annex 1;


 


ý Other
methods:                                                


 


Article 6: Before each
loan drawdown, Party A must meet the following prerequisites; in addition prior to each drawdown Party A must at least three business
days in advance submit drawdown application to Party B, otherwise Party B shall reserve the right to refuse drawdown. Party B allows
drawdown even if Party A does not meet all of the following prerequisites, which does not constitute performance defect by Party
B:


 


(A) At the request of Party B, Party
A has provided including but not limited to the following documents:


 


1. Party A’s business license,
organization code certificate and tax registration certificate after annual inspection, articles of association, identification
and identity card copy of the legal representative of Party A currently in effect.


 


2. List of Party A’s board of
directors and senior management personnel related to the loans, and each person’s specimen signature.


 






    	 



    	 	



    
 


3. Board resolution / shareholders
resolution concerning the loans and authorization of related personnel to sign loan agreement and other related documents.


 


4. Signed drawdown application by
Party A.


 


5. For each self pay loan drawdown,
after the first drawdown Party A shall provide description of use of the previous self pay loan.


 


(B) Party A in accordance with relevant
laws, regulations and rules have completed loan-related administrative licensing, approval, registration and other statutory procedures.


 


(C) The security documents related
to loan guarantees are already in effect, mortgage and pledge have been established.


 


(D) No event of any default has occurred,
or event of default occurs but it has been satisfactorily resolved or received exemption from Party B.


 


(E) Any representations and warranties
made by Party A are true, accurate and effective.


 


(F) Until each drawdown, there has
been no significant adverse change in Party A’s financial position.   


 


Article 7: Issuance
of loan


 


For Party A’s each drawdown, Party
B shall transfer approved loan to Party A’s loan account, and shall accrue interest starting from the loan drawdown date. The
loan account is:


 


þ Lending
escrow account, Party B does not sell important blank certificates, cannot do deposit and withdrawal; and unless otherwise agreed
to by Party B, cannot open e-banking platform.


 


Bank branch: China Minsheng Bank,
Weigongcun Branch                                                 .


 


Account number: 012101C910000182                                                        .


 


ý Settlement
Account


 


Bank branch:                                                        .


 


Account number:                                                 
        .


 


ý Other:                                                       . 


 


Article 8: Borrower's payment management
solutions


 






    	 



    	 	



    
 


(A) This loan shall take the following
payment option:


 


þ All
entrust payment.


 


ý All
self payment.


 


ý Entrust
payment if meeting the following criteria, otherwise self payment:


 


Entrust payment conditions: 


 


1. Party A’s single payment
amount is greater than RMB N/A Million, excluding the number.


 


2.             N/A                              
  .


 


(B) In the above agreed payment
management solutions:


 


Entrust payment refers to Party A based
on Annex 3 to the working capital loan terms submit to Party B "Withdrawal / Payment Application",
business contracts and other related documents. After passing Party B’s examination, Party B shall, according to Party A's
payment application and payment entrustment instruction, transfer the loan funds through the loan account to the transaction party
for the agreed purpose.


 


Self payment refers to Party A based on
Annex 3 to the working capital loan terms submit to Party B "Withdrawal / Payment Application". After
passing Party B’s examination, Party B shall according to Party A's payment application transfer the loan funds to the loan
account, and Party A shall directly pay to the transaction party for the agreed purpose.


 


If using self-payment, Party A shall ☐
monthly ☐ quarterly submit periodic reports to Party B for loan usage records and information; furthermore, if
Party B has other requests, Party A shall provide timely loan usage records and information based on Party B’s requests.
If both parties further agree to other forms of monitoring, Party A shall perform other monitoring requirements as requested by
Party B.


 


(C) If during the loan payment process
Party A experiences credit decline, business profitability not being strong and unusual usage of loans, Party B shall have the
right to reduce the applicable payment amount and suspend the issuance of loans and payment. In this case, Party B shall timely
notify Party A and negotiate additional loan and payment conditions. 


 


Article 9: Payment of loans


 


Loan funds in the loan account shall be
paid in accordance with the agreed payment management solution for entrust payment or self payment. Party A shall apply for
each payment by submitting in advance to Party B "Withdrawal / Payment Application" and related documents,
after approval Party B shall pay in accordance with Party A’s payment application; if Party B believes that Party A’s
application is not qualified, Party B has the right to adjust or reject Party A's payment application, the resulting payment delays,
other consequences and liabilities shall be borne by Party A, and Party B shall not bear any liabilities. 


 






    	 



    	 	



    
 


Section 5: Repayment of loans 


 


Article 10: Repayment
of loans


 


(A) Party A shall repay loan principal
in the following ways:


 


þ Repay
all principal on maturity date;


 


ý
Repay in phases based on Annex 2 to working capital loan terms: “Party A Loan Repayment Timetable (Amount and Time)”.


 


(B) Party A hereby designates the
following account for loan repayment: 


 


Bank branch: China Minsheng Bank,
Weigongcun Branch                                                .


 


Account number: 0121014180000804                                                        .


 


This account shall be used to collect funds
for loan repayment as well as make loan repayment. Party A shall provide timely information on money inflow and outflow in the
account as requested by Party B. If requested by Party B, Party A shall sign a separate account management agreement on this
loan repayment account with Party B. Party B shall have the right to recover the loan in advance based on fund collection
for repayment.


 


(C) If the agreed drawdown date and
the actual drawdown date are different, the date on the Borrowing Certificate shall prevail. If the actual first drawdown
date differs from the agreed first drawdown date, the loan maturity date shall be determined as follows:


 


1. If Party A repays all loan principal
on maturity date, maturity date shall adjust automatically in accordance with the agreed loan period and the actual first drawdown
date.


 


2. If Party A repays loan principal
in phases, maturity date shall adjust automatically in accordance with the agreed loan period and the actual first drawdown date.
The remaining principal installment payment dates shall not change duet to the actual first drawdown date, and shall follow Annex 2
to working capital loan terms: “Party A Loan Repayment Timetable (Amount and Time)”.


 


(D) If the principal repayment date
falls on a statutory holiday, then it shall be postponed to the first business day after the principal repayment date and the corresponding
interest shall be calculated to the new date. If the interest settlement date falls on a statutory holiday, the corresponding
interest shall be calculated to the original date, but the interest payment date is postponed to the first business day after the
interest settlement date.


 






    	 



    	 	



    
 


(E) If Party A’s loan repayment
account has insufficient amount to repay loan principal and interest, Party B shall have the right to directly deduct from Party
A’s other accounts opened at any of China Minsheng Bank’s branches to pay loan principal, interest, penalty interest,
compound interest, liquidated damages and other fees payable. Party B shall not be liable for any resulting loss of interest and
other losses.


 


(F) Party A shall be allowed to do
early repayment if there are no overdue loans, and shall 10 business days in advance submit written application to Party B. For
Party A's written application for early repayment:


 


þ Party
B agrees to Party A’s early repayment and shall not charge prepayment penalty.


 


ý Party
B agrees to Party A’s early repayment, in addition to charge loan interest based on the actual days of fund use and agreed
interest rate, shall have the right to charge prepayment penalty in accordance with the following formula:


 


Prepayment penalty for early repayment = early
repayment amount × (agreed loan period - actual loan period) × daily liquidated damages ratio                     ;


 


ý Party
A shall not be allowed to do early repayment.


 


(G) If Party A believes that an extension
is necessary, Party A shall at least 30 days in advance of the maturity date submit application to Party B. If Party B examines
and approves, both parties shall sign a separate loan extension agreement. If Party B does not agree, Party A shall repay the loan
in full following the agreed repayment schedule. 


 


Section 6: Events of default


 


Article 11: Occurrence of any
of the following conditions is regarded as event of default by Party A:


 


(A) Party A fails to do drawdown procedures
at Party B at the agreed time, and the overdue time reaches or exceeds the agreed drawdown date by thirty calendar days. Party
B shall have the right to charge default interest based on the actual number of overdue days and overdue interest rate, and
the right to terminate this contract.


 


(B) Party A fails to pay the agreed
principal repayment amount when due.


 


(C) Party A fails to use loans in
accordance with agreed purposes, or fails to drawdown and repay the loan in accordance with this contract.


 


(D) Party A uses piecemeal method
to avoid drawdown as entrust payment.


 






    	 



    	 	



    
 


(E) Party A’s loan account and repayment
account is frozen or deducted by the relevant authorities, or Party A is involved in litigation, arbitration, administrative penalties
and other judicial and administrative procedures, which may adversely affect Party A’s performance of this contract.


 


(F) Significant changes in financial
position of Party A, or fails to meet the financial covenants in this contract.


 


(G) Other significant adverse change
in Party A, and Party A cannot remedy ​​within the time required by Party B.


 


Upon the occurrence of an Event of Default
by Party A, Party B shall have the right to exercise the appropriate rights in accordance with this contract, declare all or part
of the loan immediately due, recover the loan ahead of schedule, and stop lending. 


 


Article 12: Annexes to working
capital loan terms are as follows:


 


Annex 1: Party A Loan Drawdown Timetable
(Amount and Time)


 


Annex 2: Party A Loan Repayment
Timetable (Amount and Time)


 


Annex 3: “Withdrawal / Payment
Application"


 


Annex 4: Agreed Financial Covenants 


 






    	 



    	 	



    
 


Annexes


 


Section 1: Guarantee 


 


Article 1: In addition to collateral,
security deposit and other guarantee methods agreed under different terms in this contract, the claims under this contract have
the following guarantees:


 


ý Guarantee,
numbered                 "Guarantee
Contract",


 


ý Mortgage,
numbered                  "Mortgage
Contract",


 


ý Pledge,
numbered                  "Pledge
Contract",


 


þ Guarantee,
numbered  99012011296041 "Maximum Guarantee Contract",


 


ý Mortgage,
numbered                 "Maximum
Mortgage Contract",


 


ý Pledge,
numbered                "Maximum
Collateral Contract",


 


ý Other:                                                     


 


Section 2: Commitments and
guarantees 


 


Article 2: Party A’s commitments
and guarantees


 


(A) Party A was established by law,
is an independent legal entity in continued existence, has appropriate qualifications and full capacity to enter into and perform
this contract and any other related documents; has been duly authorized to sign, deliver, receive and perform the above mentioned
legal documents.


 


(B) All documents, information and
evidence provided to Party B in connection with signing of the contract and any other related documents are true, complete,
accurate and effective; all financial statements and other documents reflecting the operating condition of Party A accurately reflect
Party A’s true financial condition and operating condition up till the issuance date of the documents, and furthermore since
the issuance dates of the statements or documents, there are no material adverse change in Party A’s operation and financial
condition. Party A’s signing and performance of this contract do not conflict with its existing statutes, internal regulations,
or any binding contracts, agreements and other documents.


 


(C) Information contained in the applications
under the contract for various loan types are true, legitimate and effective. Party A does not miss or conceal any important
facts.


 


(D) At the time of contract signing,
it has not occurred nor is in existence any litigation, arbitration, administrative proceedings, judicial or administrative enforcement
procedures, or other potential major disputes, which may adversely impact Party A’s performance of this contract.


 






    	 



    	 	



    
 


Before all debts owed ​​to
the bank under this contract have been fully repaid, if any major litigation or legal proceeding against Party A has occurred,
or events which may materially and adversely affect Party A’s fulfillment of obligations under this contract have occurred,
or any events of default under this contract have occurred, Party A shall inform such event or events with written notice to Party
B within five working days from the date of possible occurrence, and shall in accordance with Party B’s requirements and
within permission of the laws endeavor to take measures to remedy or make appropriate arrangements to protect B's interests.


 


(E) Party A does not have any significant
liabilities and contingent liabilities which it has not notified Party B. At the time of contract signing, no event of default
listed in Article 5 of this Annex has occurred or is continuing, and Party A is not in breach of any contracts, applicable laws,
rules, regulations, decisions and rulings related to its assets, or any agreements, contracts or other contractual documents to
which Party A is a counterparty; furthermore the signing of this contract or any documents under this contract to which Party A
is a counterparty, or performance of the above mentioned agreements and obligations under these documents, shall not lead to any
breach under any other agreements or documents.


 


(F) Party A shall completely and appropriately
perform all the commitments, guarantees, obligations and responsibilities under this contract, and shall keep confidential Party
B’s financial information, technical data or information, information or documents related to its business or operational
aspects, including but not limited to the text of this contract and other business secrets which should be kept confidential according
to the laws, except otherwise provided or disclosed in accordance with laws, regulations and administrative and judicial requirements.


 


(G) Party A shall ensure that all
matters have obtained the required government and / or other approval, authorization, permission and consent, and that
such approval, authorization, permission and consent continue to be legal and valid.


 


(H) Party A shall accept Party B’s
investigation, understanding and monitoring of the use of loans drawn under this contract.


 


(I) Party A shall actively cooperate and
consciously accept Party B’s inspection and supervision of its production, operation and financial condition, and in accordance
with Party B’s requirement promptly submit financial statements, explanation of its fulfillment of business contracts, and
related evidence.


 


(J) In the event of a major threat to Party
A’s normal operations or its ability to perform the repayment obligation under this contract, including but not limited to
events under Clause (D) of this section, Party A shall promptly notify Party B in writing.


 






    	 



    	 	



    
 


(K) If Party A conducts foreign investment,
substantial increase in debt financing, merger, division, acquisition, stock transfer, outsource, lease, transfer of assets, joint
venture, apply for stop order, dissolution, settlement, restructuring, bankruptcy as well as other acts which are sufficient to
cause changes to the contract claims and liabilities or impact Party B’s rights, Party A shall give advance notice to and
obtain written consent from Party B, otherwise Party A shall not carry out such acts.


 


(L) If Party A provides security for other
party’s debt, Party A shall notify and obtain prior written consent from Party B.


 


(M) Party A guarantees that it shall not
by single transaction or series of transactions sale, transfer or otherwise dispose of any of its major assets, unless agreed to
by Party B.


 


(N) During the term of the contract, if
Party A changes domicile, name, legal representative, responsible person and other important matters, or senior management personnel
changes occur, Party A shall notify Party B in writing within seven days after the occurrence of the changes.


 


(O) If Party A needs to transfer its obligations
under this contract to a third party, Party A must obtain prior written consent from Party B.


 


(P) If other major adverse events which
may affect Party A’s solvency occur, Party A shall promptly notify Party B.


 


(Q) Party A commits to use the loans
for the purposes in accordance with this contract, applicable laws and regulations, and shall not use for purposes not listed in
this contract. 


 


Section 3: Other rights and obligations 


 


Article 3: Other rights and
obligations


 


(A) Party A shall fulfill its obligations
in accordance with legal requirements and agreements of specific loan types; Party B shall have the right at any time to inspect
Party A’s payment management, loan management and other specific operating conditions, and request Party A to provide information
on performance of business contracts and related evidence. Party A shall cooperate with such management and inspection by
Party B.


 


(B) During the contract performance period,
Party A shall submit to Party B as requested its true financial statements, and information on all of its bank accounts, balance
of deposits and loans and so on.


 


(C) In case the Guarantor breaches
any obligation or commitment under the guarantee contract or loses its guarantee abilities, or the value of collateral is damaged
or significantly reduced, Party A commits to immediately provide a new guarantee in accordance with Party B’s requirements
to ensure its satisfaction or prepay its debt.


 






    	 



    	 	



    
 


(D) Prior to Party A or Guarantor
establishes effective guarantee contracts and completes the procedures for establishing the mortgage or pledge in accordance with
Party B's requirement, Party B shall have no obligation to perform contractual obligations under the contract.


 


(E) Unless otherwise agreed by both
parties, Party A shall bear all costs relating to this contract and guarantees under this contract, including but not limited to
legal fees, arbitration fees, attorney fees, assessment fees, registration fees, custodial fees, appraisal fees, notary fees, travel
claims and other costs for implementation of debt claims and security rights.


 


Section 4: Credit line adjustment
and accelerated payment of debt 


 


Article 4: During the contract
term, under any of the following circumstances, Party B shall have the right to adjust the credit amount, stop payment of unused
amount or request Party A to prepay in whole or in part of its debts:


 


(A) Party A is experiencing significant
deterioration in its business or has experienced major operational difficulties.


 


(B) Relevant markets of Party A’s
business is experiencing significant changes.


 


(C) Major national policy adjustments.


 


(D) Party A is in breach of contracts,
agreements, unilateral commitments or guarantees, debt claims which Party A signed as a counterparty with others; acceleration
of debt maturity has been declared or may be declared by other creditors due to such breach. 


 


Section 5: Events of default 


 


Article 5: Occurrence of any
of the following conditions is regarded as event of default by Party A:


 


(A) Party A cannot
fully and appropriately fulfill any of its commitment, guarantee, obligation or responsibility.


 


(B) The Guarantor cannot fully and
appropriately fulfill any of its commitment, guarantee, obligation or responsibility, or any guarantor which provide guarantees
to Party A cannot fully and appropriately fulfill any of its commitment, guarantee, obligation or responsibility, under other guarantee
documents.


 


(C) In the event of Party A having
any other loans, guarantees, indemnities, undertakings or other debt obligations which are overdue, or having entered litigation,
arbitration or enforcement proceedings, Party B believes that Party A’s ability to perform the contract has been or may be
adversely affected.


 






    	 



    	 	



    
 


(D) There has been adverse change
to the guarantees under the contract which may impact Party B’s claims, including but not limited to guarantees or other
security methods under the contract have not been effective, is ineffective, or have been declared to be withdrawn, the guarantors
have experienced partial or complete loss of ability to perform guarantees or have expressly declared that they will not perform
guarantee obligations, or mortgaged and pledged properties have experienced damages, losses and diminution in value, while Party
A fails to provide new guarantees as requested by Party B.


 


(E) During the contract term, Party
A or the Guarantor expressly or by their actions declares that they will not fulfill their respective contractual obligation.


 


(F) Party A provides to Party B false or
conceals important facts of the balance sheet, income statement and other important materials, or refuses to accept Party B’s
supervision of its use of credit line, production, management and financial activities.


 


(G) Party A transfers properties,
withdraws funds, avoids debt obligations, and commits other acts, which breach Party B’s rights and interests.


 


(H) Party A breaches other obligations
under the contract. 


 


Article 6: Upon Party A’s
default, Party B shall have the right to unilaterally decide to adjust the unused credit line amount, stop releasing the unused
amount, request debt prepayment in whole or in part, request Party A in accordance with this contract to bear penalty interest,
compound interest, default interest, liquidated damages, payment of compensation and damages, and other responsibilities. 


 


Article 7: If Party A and Guarantor
are overdue in performing any obligation or liability, Party B shall have the right at any time to directly deduct any of Party
A’s accounts in China Minsheng Bank to repay debt, and at the same time have the right to dispose any properties which Party
A has ownership, disposition rights or income rights of and are in the possession or custody of China Minsheng Bank, and to use
the proceeds to settle debt. Party B shall not need to bear responsibility for any loss caused to Party A arising out of such cash
conversion, sale, transfer and disposal. 


 


Article 8: Unless otherwise
provided in the Specific Business Terms under the contract, any payment received by Party B in exercising its rights shall discharge
Party B’s claims in the following order: (1) the cost of exercising claims and security rights; (2) damages
and compensation; (3) liquidated damages; (4) compound and penalty interest; (5) overdue interest; (6) interest; (7) principal; and
(8) other payables. 


 


Party B shall have the right to unilaterally
change the liquidation order. 


 


Section 6: Serving of notices 


 


Article 9: Unless otherwise
agreed, all notices shall be considered duly served on the following dates to the notified party: (1) if delivery, the
date served shall be the date of receipt by any staff or agents of the recipient; (2) if by registered mail, courier or express
mail from the same city, the date served shall be the next working day after the mailing date; and (3) if by registered
mail, courier or express mail from a different city, the date served shall be the third working day after the mailing date. However,
if the foregoing dates differ from the actual dates of receipts or signed receipts, the date served shall be the earliest date. 


 






    	 



    	 	



    
 


Article 10: If Party A changes information
and fails to fulfill the notification obligation, any notices or documents issued by Party B in accordance with the information
recorded in this contract, regardless of whether Party A receives such info, shall be considered as duly delivered. In addition,
Party A shall bear corresponding liability for breach of contract. 


 


Section 7: Settlement of disputes 


 


Article 11: Both parties shall
resolve all disputes arising from this contract through consultation; if consultation fails, shall litigate at the People's Court
of Party B’s domicile. 


 


Section 8: Effectiveness of contract 


 


Article 12: The contract shall
take effect after signing by both parties’ authorized signatories (including legal representatives, responsible persons or
authorized agents) via signature or seal, in addition to affixing the official seals or contract seals of both parties. 


 


Article 13: "Contract
Parties", "Specific Business Terms" and "Annexes" together constitute full terms of this contract.


 


Specific Business Terms must include at
least one of the following terms: "Comprehensive Credit Terms", "Working Capital Loan Terms", "Terms of
Bankers' Acceptances", "Terms of Discounted Commercial Bills ", ​​"Terms of Guarantees", "Terms
of Corporate Account Overdraft", "Terms of Factoring Lines" and respective annexes. If the contract main body
and the Specific Business Terms are inconsistent, the Business Terms shall prevail. 


 


Section 9: Other terms 


 


Article 14: Any term preceding
by "□" can be selected or non-selected. For the selected terms, "□" shall be replaced by "√";
for non-selected terms, "□" shall be replaced by "×".


 


If the information under this contract,
which is required to be completed and selected, has already been included in the "Elements of SME Financial Service Contracts
Table", both parties do not have to fill in or select in this contract. The format of the Table has to be recognized
by Party B. If both parties choose to use the Element Table, it shall become an integral part of this contract. 


 






    	 



    	 	



    
 


Article 15: Contract name and
the title of each article is used for reading convenience only and as such do not cause any restriction or impact on the content
or interpretation thereof. 


 


Article 16: In signing
of this contract, Party B shall have carried out a detailed description and interpretation of all the terms of the contract to
Party A. Both parties shall have raised no objections to any of the terms, and have accurate understanding of the lawful definitions
of the rights, obligations and limitation of liability of both parties, and exemption of terms.


 


Article 17: Party
A agrees that Party B shall have the right, in accordance with Chinese laws and requirement from financial regulatory agencies,
to provide relevant information and other information provided by Party A to the People's Bank of China’s and other legitimate
credit institutions’ credit information database so that institutions and individuals with appropriate qualifications can
check and use such info. In the event of Party A’s defaults under the contract, Party B shall have the right to decide whether
to publicly disclose such defaults based on review of such non-compliance; and for the purpose of debt collection shall have the
right to make available relevant information to debt collection agencies.


 


Article 18: Except the specific
loan types as agreed in this contract, if Party B grants other loan types to Party A, both parties shall sign separate loan agreement
specific to the particular loan type, if the new agreement is inconsistent with this contract, the new agreement shall prevail. 


 


Article 19: Other matters agreed
by both parties:


 


ý 1. Before
Party A fully repays the debt under this contract, without the written consent of Party B, Party A shall not reduce its registered
capital.


 


ý 2. Before
Party A fully repays the debt under this contract, without the written consent of Party B, Party A shall not distribute dividends.


 


ý
3. Before Party A fully repays the debt under this contract,
without the written consent of Party B, Party A shall not repay any shareholder or related party loans.


 


ý 4. At
the request of Party B, Party A shall before               
complete capital increase to                million.


 


ý 5. At
the request of Party B, Party A shall maintain average daily deposit at the accounts opened at Party B of no less than               million.


 


ý 6. The
maximum amount of discounted commercial bills by Party A under this contract shall be                ,
denominated in                . Any
third parties listed under the "Confirmation of Maximum Discounted Commercial Bills Credit Line Amount" signed by Party
A may use the credit line.


 






    	 



    	 	



    
 


ý 7. Party A shall allow all wholly owned or majority owned
companies of Party A which are set out in the annex to use the line of credit under the contract. The said companies and Party
B shall separately sign the related loan contracts. If the said companies do not fulfill contract obligations, Party A shall fulfill
instead.


 


ý 8. Based
on the                            line
of credit granted by Party B, and the signed "SME financial service contracts" of code no.                ,
all wholly owned or majority owned companies of Party A which are set out in the annex shall use the line of credit under the contract.



 


ý 9. Mandatory
contract notarization.


 


þ 10. Other: service
scope listed under SME Financial Service Contract No. 99012011296041.


 


Article 20: Original of this
contract consists of 4 copies in total, and each party keeps 1 copy. All copies have the same legal
effect. 


 


Article 21: Supplementary Appendix:
"List of companies on which fiduciary (Party A) permits to use its comprehensive line of credit"


 






    	 



    	 	



    
 




(This page is "SME Financial Service
Contract" signature page) 


 


Party A (seal): 


 


Authorized Signatory (signature or seal): Liu
Yabin


 


2012.03.14


 


 


 


Party B (seal): 


 


Authorized Signatory (signature or seal): Zhang
Xihong


 


2012.03.14


 






    	 



    	 	



    
 




Annex 1 to Working Capital Loan Terms:



 


Party A Loan Drawdown Timetable (Amount
and Time)


 


Number: ___________ 


 


	Frequency	Drawdown time	Drawdown Amount
	1	 	 
	2	 	 
	3	 	 
	4	 	 
	5	 	 
	6	 	 
	7	 	 
	8	 	 
	9	 	 
	10	 	 


 


If the drawdown time and amount are different
from those on the Borrowing Certificate, the time and amount on the Borrowing Certificate shall prevail.


 






    	 



    	 	



    
 




Annex 2 to Working Capital Loan Terms: 


 


Party A Loan Repayment Timetable (Amount
and Time)


 


Number: ___________ 


 





	Frequency	Drawdown time	Drawdown Amount
	1	 	 
	2	 	 
	3	 	 
	4	 	 
	5	 	 
	6	 	 
	7	 	 
	8	 	 
	9	 	 
	10	 	 


 


If the actual loan due date is changed,
the due date on the Borrowing Certificate shall prevail. 


 






    	 



    	 	



    
 




Annex 3 of Working Capital Loan
Terms:


 


Withdrawal / Payment Application


 


Code: _______________


 


China Minsheng Bank, Headquarter
Branch Sales Department: 


 


In accordance with the "SME Financial
Service Contract" code of Public Debt #99012012296402 signed by both our company and your bank, we hereby apply:


 


1.
þ Loan amount:
5 million. Currency: RMB. Loan period: 6 months. Purpose: working capital for daily
operation. Interest: 7.93%. If the above information is inconsistent with the actual, the Borrowing Certificate
shall prevail.


 


Our company intends to draw down on the
following date: 2012.03.14.


 


2.
ý Application
for payment using the withdrawal funds under the contract as follows:


 


(A)
ý pay out all
amount drawn under clause 1 above in the same loan amount, currency type, loan period and purpose.


 


(B)
ý pay out part
of the amount drawn under clause 1 above in the same loan amount, currency type, loan period and purpose. Loan amount:  .
Currency:  . 


 


(C)
ý pay out amount
already drawn. Loan amount: . Currency  . Loan period:  . Purpose:  . Interest: 
.. If the above information is inconsistent with the actual, the Borrowing Certificate shall prevail.


 


This application shall adopt the following
____ method of payment:


 


1. Entrust payment


 


(1) The applicant shall provide commercial
contracts and other documents required by your bank, warrant that these documents are true and valid, in addition the amount applied
and entrusted to pay shall be consistent with commercial contracts.


 


(2) The applicant unconditionally
and irrevocably consents to entrust your bank to pay out the loan funds under this application using the following details: 


 






    	 



    	 	



    
 


	
        Order

         

        No.

         
	Account Name
 (Payee name)	Bank Branch	Account Number	Amount
 (to decimal points)	Use of Proceeds	Remarks
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 


 


2. Self Payment


 


(1) The applicant promises to use the loan
funds under this application in accordance with the stated loan purposes. The applicant shall not be free to change the above loan
purposes. If the applicant intends to change the loan purposes, the applicant shall obtain the written consent of your bank; otherwise
the applicant shall be liable for breach of contract.


 


(2) The applicant unconditionally
and irrevocably consents to entrust your bank to transfer the loan funds under this application to the following bank account of
the applicant that was opened at your bank:


 


Account name: _______________________________________________________

Account number: _______________________________________________________

Opening bank branch: _____________________________________________________ 


 


The applicant has fulfilled its contractual
obligations in accordance with the above-mentioned "SME Financial Service Contract" and has provided all documents related
to this application as requested by your bank. We warrant that the above documents are true and valid; otherwise the applicant
shall be liable for breach of contract. We hereby apply for your bank’s approval.  


 


The applicant (stamped seal):


 


Authorized signatory (signature or seal): Liu
Yabin


 


Date of Application: 2012.03.14


 


Attachments:


 


□ Business Contracts:________________________(
contract name and number).


 


□ Details of previous
self payment.


 


□ Other documents requested
by your bank:                           
                      


 






    	 



    	 	



    
 




Annex 4 of Working Capital Loan
Terms:


 


 


 


Agreed Financial Covenants


 


                                     


 


Code: ___________