EX-10.13A










	







EXHIBIT 10.13A



HSBC 





Our Ref GUM CBA 020287 

(Via Facsimile & Hand Delivery) 






	
PRIVATE AND CONFIDENTIAL 

Telesource CNMI, Inc. 

KS Sablan Bldg., Sadog Tasi 

Box 10000, PPP 402 PMB 

Saipan, MP 96950 	
26 March 2002 




	


Attn: Mr KJ Semikian, President 




Re: Renewal and Amendment of Credit
Facilities 





Dear Mr Semikian: 





With reference to our recent
discussions, we, The Hongkong Shanghai Banking Corporation Limited (the “Bank”), are
pleased to confirm the renewal and amendment of the undermentioned credit facilities to
Telesource CNMI, Inc. (the “Borrower”). These facilities are subject to review at any
time and in any event by 30 November 2002, and also subject to our overriding right of
withdrawl and repayment on demand, including the right to call for cash to cover on
demand for prospective and contingent liabilities. 











A.  


			FACILITY TYPE
		PRESENT LIMITS
		PROPOSED LIMTS
	
	 	 	1. Revolving Line	 	USD2,000,000.00	 	Nil.	 
	 	 	2. Commercial Loan	 	Nil.	 	USD7,500,000.00	 
				
	
		 	TOTAL FACILITIES	 		 	USD7,500,000.00	 






	B. 		PURPOSE: 







			1. 		To
finance operational costs for several ongoing projects.








	C. 		REPAYMENT
TERM: 







			1. 		Interest
and principal due 02 November 2002, 40 days prior to expiry of Standby Letter of Credit
on 12 December 2002.








	D. 		INTEREST
RATE: 







	 	     0.5%
over the “Bank’s Base Lending Rate” (BBLR).






	 	     The
“Bank’s Base Lending Rate” means the base index rate established by the New York Office
of the Bank from time to time in good faith in its discretion for general pricing of its
short term loans to ordinary commercial borrowers. Such rates may be established and
changed from time to time.






	 	     Interest
on overdue amounts, both principal and interest, will accrue additional interest at Five
Percent (5.0%) over the above rate.













	










	E. 		FEE: 







	 	     A
non-refundable front end Arrangement Fee of USD75,000, or 1% of the facility amount is
due upon acceptance of this Offer Letter, of which USD10,000 has been paid.








	F. 		SECURITY: 







			1. 		An
irrevocable standby letter of credit issued by Al Ahli Bank of Kuwait (AKBC) and
confirmed by Bank of New York, New York, USA (YORK) for not less than USD7,500,000,
naming the Bank as beneficiary.






			2. 		Assignment
of receivables and/or Promissory Notes from parties acceptable to the Bank, such as the
Commonwealth Utilities Corporation. The value of the security to be a minimum of 125% of
the total interest amount at maturity, based on the Net Present Value of the Security.






			3. 		Corporate
Guarantee from the Borrower’s parent company, Telesource International, Inc. securing the
full facility amount.








	G. 		COVENANTS: 







			1. 		Submission
of the Borrower’s audited financial statements within 120 days of the Borrower’s fiscal
year end and at least once a year.






			2. 		Submission
of Guarantor’s audited financial statements at least once a year and prior to the
designated review date.






			3. 		Submission
of other information as the Bank may reasonably request from time to time.








	H. 		CONDITIONS
PRECDENT: 







	 	
The
Bank will require the following:






			1. 		The
Bank shall be in receipt of the Standby Letter of Credit in form and content satisfactory
to the Bank.






			2. 		Audited
financial statements for Telesource CNMI, Inc. for fiscal years ending 31 December 1999
and 2000 (RECEIVED 20FEB02)






			3. 		Draft
copies of audited financial statements for Telesource CNMI, Inc. and Telesource
International, Inc. for fiscal year end 31 December 2001 to be submitted to the Bank no
latter than 15 April 2002.








	I. 		OTHER
TERMS AND CONDITIONS:) 









			1. 		This
facility will be subject to an annual review at any time and in any event by 30 November
2002 or 40 days before the expiry of the Standby Letter of Credit.






			2. 		All
expenses in respect of this facilities are to be for the account of the Borrower. All
processing/legal/recording/other fees, if any, shall be for your account and will be
automatically debited from your current account if no other arrangements are made.







	


If the effect of any, or a
change in any, law or regulation is to increase the cost to us of advancing
maintaining or funding this facility or to reduce the effective return to us, we
reserve the right to require payment on demand of such amounts as we consider
necessary to compensate us therefore. 



As stated above, the above
terms are for indication purposes only and are subject to formal approval by the
Bank. Should the above conditions be acceptable to the Borrower, please have the
Borrower sign the enclosed copy of this letter and return it to the Bank. This
letter of indication will remain open for acceptance until the close of business
on 10 April 2002 and if not accepted by that date will deemed to have lapsed. 



















	





We hope you will find the above
terms of interest and look forward to your reply 



Yours sincerely, 



/s/Pilar O Pangelinan 



Pilar O Pangelinan 



AVP Corporate Banking 



POP/adlc 



BORROWER’S ACKNOWLEDGMENT AND
ACCEPTANCE 





On behalf of Telesource CNMI, Inc.,
I/We hereby accept the terms and conditions of this Letter of Indication.  



/s/ KJ Semikian 



By: KJ Semikian 



ITS: CEO and President 



Date: 3-25-02 





/s/ Bud Curley 



By: Bud Curley 



ITS: CFO 



Date: 3-25-02 



GUARANTOR’S ACKNOWLEDGMENT AND
ACCEPTANCE 





As Guarantor(s), I acknowledge the
terms and conditions of this Indication Letter for additional facilities, and I confirm
that the current standing or modification of Borrower’s loan agreement pursuant to
the terms of this letter is hereby authorized and shall in no way affect or impair
Guarantor’s liability under its guaranty, nor shall it affect or impair the pledge
of any security by Guarantor to secure Borrower’s performance.  



TELESOURCE INTERNATIONAL, INC. 



/s/ KJ Semikian 



By: KJ Semikian 



ITS: CEO and President 



Date: 3-25-02 





/s/ Bud Curley 



By: Bud Curley 



ITS: CFO 



Date: 3-25-02 





















	







AUTHORIZATION TO DEBIT ACCOUNT 





Kindly debit account no.
_____________ for USD65,000.00 in respect of the remaining balance of the Bank’s
Arrangement Fee. 





/s/ KJ Semikian 



By: KJ Semikian 



ITS: CEO and President 



Date: 3-25-02 





DEMAND PROMISSORY NOTE 



(Corporation) 





Loan No. 002-014694 





Saipan Commonwealth of the Northern
Mariana Islands 



15 March 2002 





$ USD 7,500,000.00 





On demand or if no demand is made on
02 November 2002, for the value received, the undersigned promises to pay to the order of
The Hongkong and Shanghai Banking Corporation Limited (the “Bank”) at Saipan,
Mariana Islands, the principal sum of United States Seven Million Five Hundred Thousand
and No/100 Dollars (USD7,500,000.00) with interest thereon from date, payable at
USD7,500,000.00 plus accrued interest on 02 November 2002 at the rate of ONE HALF percent
(0.5%) per annum above the Bank’s prime rate which is defined as the normal rate of
interest then being offered by the Bank for loans to substantial and responsible
commercial borrowers as such rate shall change from time to time and computed on the
basis of a 360-day-year and actual days elapsed. The Bank shall not be required to notify
the undersigned of such rate fluctuations. The term “prime rate“as used in this
noted means the Bank’s primary base rate for pricing short term commercial loans
whose interest rate float with such prime rate. The Bank’s prime rate as defined
herein is subject to change from time to time and may be lowered, higher or equal to the
“prime rate“as used by other lending institutions. The interest rates charged
on commercial loans in the future by the Bank may be higher or lower than the prime rate
as defined herein. The interest rate applicable to this note shall be adjusted by the
Bank from time to time in accordance with the change and movements in the Bank’s
prime rate. All payments paid hereunder shall be credited first to accrued interest (and
to late payment charges, if any), and then to principal in lawful monthly of the United
States of American. If any interest due herein is not paid when due, it shall bear like
interest as the principal amount hereof.  



If any sum payable hereunder shall
not be paid when due, without limiting any other rights of the holder hereof, the
interest rate with respect to such sum shall automatically be increased by FIVE percent
(5.0%) per annum, effective on the date such sum is due. The undersigned jointly and
severally agree to pay all costs of collection (including attorney’s fee) incurred
by the holder of this Note, whether or not suit be brought. In any litigation arising out
of or relating to this Note, in which the holder of this Note is an adverse party, each
of the undersigned hereby waives trial by jury. Each of the undersigned hereby further
waives presentment, demand for payment, notice of dishonor, notice of nonpayment,
protest, notice of protest, and any and all other notices and demands in connection with
the delivery, acceptance, performance, default, or enforcement of this Note, and each of
the undersigned hereby waives the benefits of any statute of limitation with respect to
any action to enforce, or otherwise related to, this Note.  



In no event shall the undersigned be
obligated to pay any amount under the Note that exceeds the maximum amount allowable by
law. If any sum is collected in excess of the applicable maximum amount allowable by law,
the excess collected shall, at the Bank’s discretion, be applied to reduce the
principal balance of this Note or return to the undersigned.  



















	





No waiver or modification of any of
the terms or provision of this Note shall be valid or binding unless set forth in writing
signed by the holder of this Note, and then only to the extent herein specifically set
forth. The holder of this Note is hereby authorized, without notice of the undersigned,
to cause or permit one or more co-makers to be added, released or withdrawn as parties
hereto, without relieving the other parties hereto of their liability and obligation
hereunder.  










	Address:		Box
10000, PPP 402 PMB 
Saipan, MP 96950  






	


Telesource CNMI, Inc. 



KJ Semikian 



By: Khajadour J. Semikian 



ITS: President