Document:

Unassociated Document

Exhibit 10.49

 

Working Capital Loan Contract

 

Code: 1317150101

 

Borrower:Beijing Wowjoint Machinery Co. Ltd.

 

Business registration number: 110102006704329

Legal representative/Responsible Person: Liu Yabin

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

Zip code: 100088

Bank name and account number: Bank of China, Beijing Shangdixinxi Branch, 338950597425

Telephone: 89579330                    Fax: 89579330

Lender:Bank of China Limited (BOC), Beijing Shangdi Branch

 

Legal representative/responsible person: Han Wen                    

Address: Building No. 6, Huihuang International Mansion, No. 1, Shangdi 10th Street, Haidian District, Beijing, P.R. China

Zip Code: 100085

Phone: 62410871                           Fax: 62410873

 

The Borrower and the Lender through fair negotiation agree on the terms on which the Lender shall grant loans to the Borrower. This contract is entered into so as to reflect such agreements.

This agreement is under the “Overall Credit Agreement” No. G16E131711 signed between Beijing Wowjoint Machinery Co. Ltd. and Bank of China (BOC), Beijing Shangdi Branch.

 

Article 1: Loan amount and term

Currency of loan: RMB.

Loan amount: 10 million.

 

Article 2: Loan term

Loan term: 12 months, starting from the actual date of withdrawal; if withdraw in phases, then start from the date of first withdrawal. 

The Borrower shall follow strictly the withdrawal schedule. If the actual withdrawal date is later than the scheduled withdrawal date, the Borrower shall still repay the loan on repayment date agreed in this agreement.  

 

Article 3: Loan purpose

Loan purpose: procurement of raw materials.

 

Without written consent of the Lender, the Borrower may not change the loan purpose, including but not limited to the following: the Borrower cannot use the loan to invest in fixed asset, stocks and so on, cannot use the loan on fields and uses of production and operation, which are restricted by the government.

 

  

1

  

 

Article 4: Loan interest rate and interest calculation

 

1. Loan interest rate

 

Loan interest rate is determined using the following #2 method:

(1) Fixed interest rate, annual interest rate N/A%. Interest rate remains unchanged during the life of the contract. 

 

(2) Floating interest rate, interest starts accruing from the actual withdrawal date; if withdraw in phases, starts from the first actual withdrawal date. Interest rate shall be reset every 3 months. The reset date shall be the first date of the next loan period. The next rate-setting date is corresponding to the date of the end of the last loan period; if at the time of rate setting, the month does not have a corresponding date to the loan withdrawal date, then the date is set to the last day of the month. 

For each borrowing:

RMB loan floating interest rate –

 

A. First loan period (from the actual withdrawal date to the end of the first floating period), interest rate shall be the corresponding People's Bank of China published benchmark lending rate for six months to one year (including one year) plus float upward by 10%; 

B. On the reset date, together with other withdrawals, the interest rate shall be reset to the corresponding People's Bank of China published benchmark lending rate for the same loan period plus float upward by 10%.

2. Interest rate calculation

Interest shall accrue daily starting from the actual withdrawal date.

Formula for calculating interest rate: principal x actual loan dates x daily interest rate

Based on 360 days per year, daily interest rate = annual interest rate / 360.

 

3. Interest payment

The Borrower shall pay interests using the following #1 payment method:

	
(1)

	
Quarterly payment on the 21st day of the last month of each quarter. The 20th date of the last month of each quarter is the interest settlement date.

	
(2)

	
Monthly payment on the 21st day of each month. The 20th date of each month is the interest settlement date.

If the last principal repayment date does not fall on the interest payment date, the last principal repayment date shall be the interest payment date, and the Borrower shall repay all interest due.

4. Penalty rate

	
(1)

	
If the Borrower fails to repay loans already due or use the loans not in accordance with agreed purposes, the Lender shall charge penalty interest rate agreed upon in this agreement on the portion of loans that has been overdue or misused, starting from the date of overdue misused, until all principal and interest are fully repaid.

 

  

2

  

 

For loans that are both overdue and misused, the Lender shall charge the higher penalty rate.

	
(2)

	
For loans that are overdue, the Lender shall charge both interest rate and penalty rate in accordance with Article 3.

	
(3)

	
Penalty rate:

Floating interest rate –

In accordance with Article 1 (floating rate period and determination method), penalty rate for overdue loans is calculated using the original loan interest rate plus 50% surcharge. Penalty rate for misused loans is calculated using the original loan interest rate plus 100% surcharge.

 

Article 5: Loan withdrawal prerequisites

The Borrower must meet the following prerequisites before loan withdrawal:

 

	
(1)

	
This agreement and its appendix have been effective;

	
(2)

	
The Borrower has provided guarantee as requested by the Lender. The guarantee has been effective and the Borrower has completed the statutory approval, registration or filing procedures as required by law;

	
(3)

	
The Borrower has reserved, entered into and executed the Borrower documents related to this agreement, the chops, relevant person list, signature samples, and filled in the relevant certificates;

	
(4)

	
The Borrower has opened bank accounts specific for this agreement as requested by the Lender;

	
(5)

	
The Borrower shall submit written withdrawal notice and relevant documents to demonstrate loan purpose to the Lender at least five banking days before withdrawal date;

	
(6)

	
The Borrower has provided to the Lender all the necessary resolution and authorization, in which the Board of Directors and relevant authorities have agreed to sign and execute this agreement;

	
(7)

	
The Lender has received written approval for loan withdrawal from the Guarantor, Beijing Zhongguanchun Sci-tech Guaranty Co., Ltd.

	
(8)

	
Other prerequisites required by laws or agreed by both parties: N/A

If the above prerequisites are not met, the Lender has the right to reject the Borrower’s application for loan withdrawal, unless the Lender makes an exception.

 

Article 6: Loan withdrawal time and method

1. The Borrower shall use the #1 time and method to make loan withdrawal:

 

	
(1)

	
On (year) 2013 (month) July (date) 24 one-time withdrawal;

	
(2)

	
Starting from (year) N/A (month) N/A (date) N/A (times) N/A withdrawal;

  

3

  

 

	
(3)

	
Withdraw in phases according to the following schedule:

	
Withdrawal Time

	
Withdrawal Amount

	
N/A

	
N/A

2. The Lender has the right to reject to reject the Borrower’s application for loan withdrawal for the portion of loan that the Borrower has not withdrawn past the above time.

Article 7: Disbursement of loan funds

1. Loan account

The Borrower shall set up the below bank account at the Lender for loan withdrawal and disbursement:

Account Name: Beijing Wowjoint Machinery Co. Ltd.

Account number: 338960597425

2. Loan disbursement method:

	
(1)

	
The loan disbursement method must be in accordance with laws and regulations, regulatory requirement and terms of this contract. The disbursement method should be specified in the loan withdrawal application in the case of single withdrawal. If the Lender believes that the loan disbursement method specified in the loan withdrawal application does not meet the requirement, the Lender has the right to change the loan disbursement method or stop the loan withdrawal and disbursement.

	
(2)

	
Lender entrusted payment: based on the Borrower’s withdrawal application and entrusted payment authorization, the Lender shall transfer the loan funds to the transaction counterparties, which are in accordance with agreed loan purpose under this contract. According to the relevant regulatory requirements by the Chinese Banking Regulatory Commission and the internal management guidelines, the Lender shall use the entrusted payment method if the disbursement satisfies one of the following conditions:

	
  

	
A.

	
The Lender and the Borrower newly established credit business relationship, and the Borrower’s credit rating has not reached the internal requirement of the Lender;

	
  

	
B.

	
In the loan withdrawal application, the disbursement counterparty is clearly stated (with clear bank account name and number), and each single disbursement exceeds RMB5,000,000 (not inclusive, for foreign currency loan use N/A exchange rate on the actual loan withdrawal date to convert);

	
  

	
C.

	
Other circumstances required by the Lender or agreed with the Borrower: under this contract we shall use lender entrusted payment method for all loans.

	
(3)

	
Borrower self payment: based on the Borrower’s loan withdrawal application, the Lender shall transfer the loan funds to the Borrower’s account, then the Borrower shall make disbursement directly to the transaction counterparties, in accordance with agreed loan purpose under this contract. Except the above stated circumstances, the Borrower self payment method shall apply to all other payments.

	
(4)

	
Disbursement method change: after submitting loan withdrawal application, if changes have occurred with respect to the Borrower‘s ability to pay to third parties, its credit rating and other conditions, the loan disbursement method shall change for the loan funds originally intended for the Borrower self payment, if conditions under Article 7, Section 2(2) are met. With respect to changes in disbursement method, amount, counterparty, use of funds and other details under the Lender entrusted payment method, the Borrower shall provide written explanation of disbursement method changes to the Lender, and re-submit loan withdrawal application, evidence to demonstrate fund use, and other relevant transaction information.

  

4

  

 

3. Specific conditions under the entrusted payment method:

	
(1)

	
Entrusted payment authorization. If conditions are met for Lender entrusted payment method, the Borrower shall give clear disbursement authorization in the loan withdrawal application, i.e. authorizes and entrusts the Lender to transfer the loan funds to the designated Borrower account, then directly make disbursement to the designated transaction counterparties, which are in accordance with agreed loan purpose under this contract. The Borrower shall provide counterparty’s account name, account number, amount and other necessary disbursement information.

	
(2)

	
Provide transaction information. If conditions are met for Lender entrusted payment method, at the time of each loan withdrawal, the Borrower shall provide to the Lender disbursement account information, counterparty account information and evidence to demonstrate that the loan withdrawal is in accordance with agreed loan purpose under this contract. The Borrower shall warrant that all of the information provided to the Lender is true, accurate, complete and effective. If the Lender could not complete its entrusted payment obligation on a timely basis due to the untrue, inaccurate or incomplete transaction information provided by the Borrower, the Lender shall not bear any responsibility and the Borrower’s loan repayment obligation under this contract shall not be affected.

	
(3)

	
The Lender’s obligation for entrusted loan payment:

	
  

	
A.

	
After the Borrower provides entrusted payment authorization and related transaction documents, the Lender shall use the loan funds to make disbursement to the Borrower’s transaction counterparties through the Borrower’s account after verification and approval.

	
  

	
B.

	
During the verification process, if the Lender finds that the evidence to demonstrate loan purpose and other transaction information provided by the Borrower is not in accordance with the requirement under this contract or has other defects, the Lender has the right to request the Borrower to add, change, explain or re-submit relevant information. Before the Borrower provides relevant transaction information that the Lender deems acceptable, the Lender has the right to reject any loan withdrawal and disbursement.

	
  

	
C.

	
If the transaction counterparty’s bank returns the funds, which results in the Lender’s inability to complete its obligation under the entrusted payment on time, the Lender shall not bear any responsibility and the Borrower’s loan repayment obligation shall not be affected. The Borrower hereby authorizes the Lender to freeze the funds returned by the transaction counterparty’s bank. Under this circumstance, the Borrower shall re-submit entrusted payment authorization, evidence to demonstrate loan purpose and other related transaction documents.

	
  

	
D.

	
The Borrower cannot split up the payment amount in order to avoid using the Lender Entrusted Payment method.

4. After the release of the loan funds, the Borrower shall promptly provide records and information related to the usage of the loan funds as requested by the Lender, the foregoing materials including but not limited to N/A.

5. The Lender has the right to redefine the prerequisites for loan withdrawal and payment, or stop the loan withdrawal and payment:

	
(1)

	
The Borrower splits up the payment amount in order to avoid using the Lender Entrusted Payment method, which is in violation of this contract;

	
(2)

	
The Borrower’s credit rating declines or the profitability of its principal business is not strong;

	
(3)

	
The Borrower’s unusual use of loan funds;

	
(4)

	
The Borrower has not promptly provided records and information related to the usage of the loan funds as requested by the Lender;

 

  

5

  

 

	
(5)

	
The Borrower makes payment using the loan funds in violation of this contract.

 

Article 8: Loan repayment

	
1.

	
The Borrower shall designate the below account for return of funds, i.e. all return funds shall go through this account. The Borrower shall timely report to the Lender account information regarding return of funds and transaction flows. The Lender has the right to ask the Borrower to explain the large amount or unusual transaction flows in the account, and supervise the account.

Account name: Beijing Wowjoint Machinery Co. Ltd.

Account number: 338960597425

	
2.

	
Unless agreed otherwise, the Borrower shall repay the loan under this contract using #2 method:

	
  

	
(1)

	
Repay all loans under this contract on maturity date.

	
  

	
(2)

	
Repay loans under this contract using the below repayment plan:

 

	
Repayment Time

	
Repayment Amount

	
May 1, 2014

	
RMB5,000,000

	
July 1, 2014

	
RMB5,000,000

	
  

	
(3)

	
Other repayment plan: N/A.

If the Borrower needs to change the above repayment plan, the Borrower is required to provide written application to the Lender 5 banking business days before the loan due date. Both parties need to confirm in writing to any change in repayment plan.

	
3.

	
Unless agreed otherwise, if the Borrower is delinquent in both loan principal and interest repayment, the Lender has the right to determine the order in which principal and interests are to be repaid: if repay in installment and the Borrower has several payment due and overdue, the Lender has the right to determine the order in which each payment is to be applied. If the Borrower and the Lender have several overdue loan contracts, the Lender has the right to determine the order of contract, in which each payment is to be applied.

	
4.

	
Unless agreed otherwise, the Borrower can prepay the loans, but must submit written notice 5 banking business days in advance to the Lender. The prepay amount must be applied first to the loan last due, repayment in reverse order.

	
5.

	
The Borrower shall repay the loans using the below #1 method:

	
  

	
(1)

	
The Borrower shall transfer sufficient amount into the below loan repayment account 5 banking business days before each principal and interest repayment due date. The Lender shall have the right to deduct from the account automatically on each principal and interest repayment due date.

 Loan repayment account Name: Beijing Wowjoint Machinery Co. Ltd.

Account number: 338960597425

	
  

	
(2)

	
Other repayment plan as agreed by both parties: N/A.

 

  

6

  

 

Article 9: Guarantee

	
1.

	
The security under this contract is:

  

Guarantor: Zhongguanchun Sci-tech Guaranty Co., Ltd., which provides maximum guarantee contract to the Lender under “Maximum Guarantee Contract “ (Code: BG16E131711A).

Guarantor: Liu Yabin, which provides maximum guarantee contract to the Lender under “Maximum Guarantee Contract “ (Code: BG16E131711B).

 

	
2.

	
If the Lender believes that events which will have negative impact on the ability of the Borrower or the Guarantor to perform this contract have occurred, the guarantee contract has become invalid, revoked or discharged, the financial condition of the Borrower or the Guarantor has deteriorated, they have been involved in major litigation, there are other reasons which may affect their ability to perform this contract, the Guarantor has violated the Guarantee contract or other contracts signed with the Lender,  the collateral has suffered depreciation, damage, loss and seizure which causes the collateral’s value to diminish or lose, the Lender has the right and the Borrower has the obligation to provide a new guarantee, change guarantor, etc. to provide adequate guarantee for the loans under this contract.

 

Article 10: Representations and warranties

1. The Borrower makes the following representations:

 

	
(1)

	
The Borrower has registered legally and continues to exist on a valid basis.  The Borrower also has complete civil power capacity and execution ability to sign and perform under this contract.

	
(2)

	
Signing and performing this contract is based on the true intention of the Borrower. The Borrower has obtained legal and valid authorization required under the Articles of Association or other related internal management documents. It is not in violation of any agreements, contracts and other legal documents that are biding on the Borrower. The Borrower has obtained or will obtain all necessary approvals, licenses, filings or registration required for signing and performing this contract.

	
(3)

	
All documents, financial reports, certificates and other information provided to the Lender under this contract have been true, complete, accurate and effective.

	
(4)

	
Transaction background for which the Borrower applies to the Lender for loan funds is true and legal, it is not used for illegal purpose such as laundering money.

	
(5)

	
The Borrower has not concealed from the Lender any events, which may negatively its and the Guarantor’s financial condition and ability to perform this contract.

	
(6)

	
The Borrower and the projects on which the loan funds will be used meet the national environmental requirements. They are not corporations and projects that were published and identified by relevant state departments as having outstanding energy consumption and pollution issues and not having been able to rectify effectively. They do not have energy consumption and pollution issues.

	
(7)

	
Other items for representation: N/A.

2. The Borrower makes the following warrants:

	
(1)

	
As requested by the Lender, regularly and timely submit financial reports (including but not limited to annual, quarterly and monthly reports) and other related info. The Borrower warrants that it will continue to satisfy the below financial ratio requirement: N/A;

	
(2)

	
If the Borrower has signed or will sign counter-guarantee agreement or similar agreements with the Guarantor regarding its guarantee obligations under this contract, these agreements will not damage any rights of the Lender under this contract;

  

7

  

 

	
(3)

	
The Borrower shall accept credit check and supervision by the Lender and shall provide sufficient assistance and cooperation. For Borrower self payment, shall provide regular consolidated report on fund payment and usage as required by the Lender. Specific consolidated report time: N/A;

	
(4)

	
Prior to merger, split, capital reduction, ownership transfer, outside investments, substantial increase in debt financing, transfer of major assets and debts and any other actions which may adversely affect the Borrower’s ability to repay loans, the Borrower shall obtain prior written consent from the Lender;

If one of the following circumstances occurs, the Borrower shall timely notify the Lender:

 

	
A.

	
Change of the Borrower’s or the Guarantor’s articles of association, operation scope, registered capital or legal representative;

	
B.

	
Changes in the mode of operation such as any form of association, joint venture with foreign-owned firms, cooperation, contract management, reorganization, restructuring, IPO planning and so on;

	
C.

	
Involved in major litigation or arbitration, economic disputes, seizure, detention or supervision of assets or collateral, or establish new guarantee on the collateral;

	
D.

	
Going out of business, dissolution, liquidation, being ordered to stop business, revocation of business license, or application (by application) for bankruptcy;

 

	
E.

	
The shareholders, directors and current senior management personnel have been involved in major cases or economic disputes;

	
F.

	
Events of default under other contracts;

	
G.

	
Encountering operational difficulties and deterioration in financial condition, etc.

	
(5)

	
The Borrower’s debt obligation under the contract shall have priority claim before its debt to shareholders, and shall enjoy equal position as other creditors of similar debt;

	
(6)

	
The Borrower shall not pay dividends and bonuses in any form to shareholders from the contract effective date until the date of paying off all of the loan principal, interest and other payables under the contract.

	
(7)

	
The Borrower shall not reduce its solvency through disposal of its own assets, and warrant not to provide external guarantees with total amount higher than 0.5 times of its net assets, in addition the total and single external guarantee amount shall not exceed the limits set in the company’s article of associations;

	
(8)

	
Except agreed usage of loan funds under this contract or agreed by the Lender, the Borrower can not transfer loan funds under this contract to accounts with same names or accounts of related parties;

For transferring of loan funds to accounts with same names or accounts of related parties, the Borrower shall provide corresponding evidence.

	
(9)

	
The Lender has the right of early recovery of loan funds based on the Borrower’s return of funds status.

	
(10)

	
Other items for warranties: N/A.

 

  

8

  

 

Article 11: Disclosure of related party transactions

Both parties agree to use the #1 clause:

	
1.

	
The Borrower is not one of the group customers listed on “Guidelines on Credit Risk Management of Commercial Bank’s Group Customers” (referred to as “Guidelines”) of the Lender.

	
2.

	
The Borrower is one of the group customers listed on “Guidelines on Credit Risk Management of Commercial Bank’s Group Customers” (referred to as “Guidelines”) of the Lender. The Borrower shall timely report to the Lender any transactions that account for above 10% of its net assets, including the relationships among each transaction counterparties, transaction project and transaction nature, transaction amount or corresponding ratio, valuation policy (including transaction with no dollar amount or only symbolic amount).

If one of the below situation occurs for the Borrower, the Lender shall have the right to unilaterally stop payment on unused loan funds and request partial or full principal and interest repayment ahead of schedule: use fake contracts with related parties, notes receivables without actual transactions, accountants receivables and other claims to get discount or pledge from the bank, in order to get bank loans or credit; major mergers, acquisitions, restructuring and so on which the Lender feels may impact the loan safety; intentionally avoid bank debt using related party transactions; other situations outlined in Clause 18 under the “Guidelines”.

Article 12: Events of default and handling

One of the following events constitutes a default by the Borrower under this contract:

 

	
(1)

	
The Borrower has not fulfilled its obligations under this contract to the Lender, and its loan repayment responsibility;

	
(2)

	
The Borrower has not disbursed the loan funds in accordance with this contract or used loan funds for agreed purpose in this contract;

	
(3)

	
The representations made by the Borrower in this contract are untrue, or the Borrower is in violations of warranties made in this contract;

	
(4)

	
Situations listed under Article 10, Clause 2(4) occur, which the Lender believes may impact the Borrower’s or the Guarantor’s financial condition and ability to perform the contract. The Borrower does not provide new guarantee and replace guarantor in accordance with this contract;

	
(5)

	
The Borrower's credit status has declined, or its profitability, solvency, operations, cash flows and other financial indicators drop below the agreed standards in this contract or in other financial agreements.

	
(6)

	
The Borrower has events of default under other contracts signed with the Lender or other associated companies of the Bank of China Limited; the Borrower has events of default under loan contracts signed with other financial institutions;

	
(7)

	
The Guarantor is in violation of the guarantee contract, or has events of default under other contracts signed with the Lender or other associated companies of the Bank of China Limited;

	
(8)

	
The Borrower goes out of business, or is in dissolution, revocation or bankruptcy.

	
(9)

	
The Borrower has been or may be involved in major economic disputes, litigation, arbitration, seizure, detention or mandatory enforcement of assets, legal investigation by judicial, taxation, administrative or other authorities, or having been given punitive measures by law, which have or may affect its fulfillment of obligations under this contract;

  

9

  

 

	
(10)

	
Changes in the Borrower’s principal individual investors, key management personnel’s abnormal changes, being missing, being investigated by judicial authorities or being restricted of personal freedom, which have or may affect its fulfillment of obligations under this contract;

	
(11)

	
When the Lender conducts annual audit (starting from the first anniversary of the contract effective date) of the Borrower’s financial condition and ability to perform the contract, the Lender finds situations which may impact the Borrower’s or the Guarantor’s financial condition and ability to perform the contract;

	
(12)

	
The return of funds account has large amount or unusual fund inflows and outflows, and the Borrower cannot provide acceptable explanation materials to the Lender;

	
(13)

	
The Borrower is in violation of other agreements in this contract regarding its rights and obligations.

If the events of default outlined above occur, the Lender shall have the right to take the following measures separately or simultaneously based on specific situation:

 

	
(1)

	
Require the Borrower and the Guarantor to cure the default within a time limit;

	
(2)

	
Reduce, suspend, cancel or terminate fully or partially the credit limit extended to the Borrower;

	
(3)

	
Suspend or terminate loans and other financing instrument under this contract and other contracts entered into between the Lender and the Borrower; and suspend or terminate fully or partially, stop withdrawal, payment and handling of some or all of the undrawn loans and trade finance loans;

	
(4)

	
Declare that some or all of the outstanding principal and interests of the loans / trade finance loans and other loan receivables under this contract and other contracts entered into between the Lender and the Borrower immediately due;

	
(5)

	
Terminate or release this contract, fully or partially terminate or release other contracts entered into between the Borrower and the Lender;

	
(6)

	
Require the Borrower to compensate for damages caused to the Lender due to its breach of contract;

	
(7)

	
Deduct from the Borrower’s accounts opened with the Lender and/or the Bank of China’s other companies in order to repay some or all of the debts under the contract. The loan not yet due under the account shall be deemed due in advance. If the currency in the account is different from that of the Lender’s credit operation, the Lender’s applicable exchange rates on the deduction date shall apply. 

	
(8)

	
Exercise security interest on the collateral;

	
(9)

	
Request the Guarantor to assume guarantee obligation;

	
(10)

	
Other measures which the Lender deems necessary and probable.

 

Article 13: Reservation of rights

Not exercise partially or fully any rights by any one party, or not request the other party to perform and assume partially or fully any obligations and responsibilities under the contract shall not constitute a waiver or change of such rights and obligations by such party.

One party’s leniency, extension or delay in exercising rights over the other party under this contract shall not affect any rights enjoyed by this party under this contract or by laws and regulations, and shall not deem to a waiver of such rights.

 

  

10

  

Article 14: Change, amendment or termination

After negotiation by both parties, this contract can be changed or amended in writing. Any changed or amended terms shall form an integral part of this contract. 

Unless required by laws and regulations or otherwise agreed by both parties, this contract shall not be terminated until all of the rights and obligations have been fulfilled under this contract.

Unless required by laws and regulations or otherwise agreed by both parties, invalidity of any terms under this contract shall not affect the legality of other terms.

 

Article 15: Application of the laws and dispute resolution

 

People’s Republic of China laws is applicable to this contract.

After the contract becomes effective, for all disputes arising out of or relating to this contract both parties can resolve through negotiation. If negotiation is not successful, any one party can adopt #2 resolution method:

	
(1)

	
Submit the dispute to N/A arbitration commission, using the arbitration rules in force at the time of arbitration application submission, in N/A (arbitration venue) for arbitration. 

	
(2)

	
Based on the laws or the exercise of rights and obligations under this contract or single agreement, the Borrower can sue the Lender on the People’s court where the Lender or the Bank of China’s other companies is located.

	
(3)

	
Based on the laws, any party can sue on the People’s court that has jurisdiction.

During the dispute resolution period, if this dispute does not affect the performance of other terms in this contract, then all the other terms shall continue to be executed.

 

Article 16: Annexes

 

The following annexes and other mutually agreed upon annexes by both parties shall form an integral part of this contract, and are as legally valid as the contract.

 

1. Loan Withdrawal Application Form  

Article 17: Other agreed matters

	
1.

	
Without the written consent of the Lender, the Borrower may not transfer any of its rights and obligations under the contract to a third party. 

	
2.

	
If due to operation needs the Lender needs to delegate other Bank of China Ltd.’s other companies to perform the rights and obligations under this contract, or assign loan operations under this contract to Bank of China Ltd.’s other companies to undertake and manage, the Borrower hereby consents. The Bank of China Ltd.’s other companies to which the Lender delegates or assigns shall be entitled to exercise all rights under this contract and shall have the right to dispute under this contract through litigation, arbitration or application to apply to enforce claims using its own name.

  

11

  

 

	
3.

	
Under no circumstances whereby it affects other agreements in this contract, this contract shall be legally binding on parties, its respective heirs and delegates.

	
4.

	
Unless otherwise agreed, both parties designate home address listed in this contract for mailing and contact, and warrant that if the mailing and contact address is changed, the party shall in writing promptly notify the other party.

	
5.

	
The transactions under this contract are based on the independent interests of each party. If required by relevant laws, regulation and regulatory requirements, the transaction counterparties become the Lender’s related parties or persons, the parties can not use the related party relationships to affect the fairness of the transactions.

	
6.

	
Headings and business names in this contract are used for reference convenience only, and shall not be used to explain any clauses or rights and obligations of any parties under this contract.

	
7.

	
Following the provisions of relevant laws and regulations as well as regulatory requirements, the Lender shall have the right to provide information relating to this contract and the Borrower to the People's Bank of China’s credit system and other credit information database established by law, for query and use by appropriately qualified agency or individual. The Lender shall also have the right to query information related to the Borrower through the People's Bank of China’s credit system and other credit information database established by law, for the purpose of establishing and performing under this contract.

	
8.

	
If a loan withdrawal date or repayment date falls on a statutory holiday, the date will be postponed to the first working day after the statutory holiday.

	
9.

	
If due to laws, regulations or regulatory requirements by authorities, the Lender cannot perform this contract or cannot perform in accordance with this contract, the Lender shall have the right to request changes to this contract or any single agreements under this contract based on the laws, regulations or regulatory requirements by authorities. Due to this reason the contract has to be terminated or changed, which causes the Lender unable to perform this contract or perform in accordance with this contract, the Lender shall bear no responsibility.

	
Article 18: Contract effectiveness

 

This contract shall become effective on the date of signing by the Borrower’s and the Lender’s legal representative (responsible person) or the respective authorized signors, and stamping with respective official seals.

 

This contract shall have 6 copies, of which the Borrower and the Lender each hold 3 copies. All copies have the same legal validity.

 

Borrower (seal):Beijing Wowjoint Machinery Co. Ltd.

Authorized Signor: Liu Yabin

 

Contract signed on:  2013.07.02

 

Lender (seal): Bank of China Limited, Beijing Shangdi Branch

 

Authorized Signor: Han Wen  

 

Contract signed on: 2013.07.02

 

 

12Unassociated Document

Exhibit 10.50

 

Bank of Beijing

C12014

Contract Number:  0174170

 

Loan Contract

(Suitable for corporate customer’s working capital loan)

Borrower: Beijing Wowjoint Machinery Co. Ltd.

Lender: Bank of Beijing, Shangdi Branch

Contract Signing Date: August 7, 2013

  

  

  

 

Loan Contract 

  

Borrower: Beijing Wowjoint Machinery Co. Ltd.

Organization code: 75961712-9 

Business license: 11010200670432

Legal representative/responsible person: Liu Yabin 

Address: Du Shi Industrial Park, Songzhuang Town, Tongzhou Dist., Beijing, P.R. China or 1108 A Block, Tiancheng Mansion, #2 Xinfeng Rd., Deshengmenwai St, Xicheng District. Beijing, P.R. China

Zip code: 101118 

Telephone: 89579330 

Fax: 89579553

Contact person: Rui Peng 

Lender (hereinafter referred to as “Bank of Beijing”): Bank of Beijing, Shangdi Branch

Legal representative/responsible person: Yu Guirui   

Position: Branch Manager

Address: 1 Shangdixinxi Road, Haidian District, Beijing

Zip code: 100085

Telephone: 82895586

Fax: 82895592

In accordance with the “Law of the People’s Republic of China on Contract”, the following contract conditions and General Terms and Conditions for Loan Contract, the Borrower and the Bank of Beijing (hereinafter referred to as “both parties”) make this contract on the signing date stated on the cover at the place of domicile of Bank of Beijing through cooperative/friendly negotiation.

A. Associated contract (fill when appropriate):

This contract is a specific business contract numbered [0159579] and signed between the accrediting party Bank of Beijing, Shangdi Branch and the accredited party Beijing Wowjoint Machinery Co. Ltd., under the Comprehensive Credit Contract.

B. Loan amount and period:

B.1 The loan currency under this contract is RMB, and the loan amount is (in case of discrepancy of amounts in words and in figures, the amount in words shall prevail, the same below): (in words) five million Yuan only, (in figures): RMB 5,000,000.00 Yuan.

B.2 The period for this loan contract is 12 months since the first withdrawal date.

 

  

2

  

B.3 The expiry date of loan shall be the date on which the loan period specified in B.2 expires.

C. Contract interest rate:

C.1 In case of RMB loan, the contract interest rate shall be determined based on the base interest rate on the withdrawal date þupward 15%. The contract interest rate during the loan period shall be adjusted XXX times.

C.2 In case of foreign currency loan, the contract interest rate shall be determined based on the HIBOR (for HK currency) or LIBOR (for other foreign currencies) interest rate (which is the rate on the second working day before the withdrawal date) with a XXX months period, with increased base point not less than [XXX BP], for which the value stated in the loan receipt approved by the Bank of Beijing shall prevail.

C.3 Before the loan under this contract is fully repaid, the above contract interest rate during the loan period shall float as per 2.4 hereof.

D. Withdrawal plan, use of loan and account monitoring:

D.1 The withdrawal period is XXX days, commencing on the signing date.

D.2 The Borrower shall use loan funds in accordance with the stated purpose in the loan receipt approved by the Bank of Beijing. However the Borrower shall use entrust payment method if single payment exceeds RMB10,000,000.

D.3 Loan funds shall be transferred to the Borrower’s bank account opened at the Bank of Beijing with account number of 01090946300120102114378 (if the Borrower and the Bank of Beijing mutually agree to change, the new account number shall be stated in the loan receipt). The Borrower shall use this account to make payment to third parties using the loan funds, and shall accept the inspection and supervision of Bank of Beijing.

D.4 The Borrower shall at Bank of Beijing (name of opening branch) set up a bank account with number of 01090946300120102114378 with account name of Beijing Wowjoint Machinery Co. Ltd. as the account for return of funds (can be changed with the approval of Bank of Beijing). The Borrower shall quarterly report to Bank of Beijing account information regarding return of funds and transaction flows, and promise to cooperate with Bank of Beijing’s inspection and supervision. For the above account, Bank of Beijing shall inspect, supervise and manage in accordance with terms agreed in this contract.

 

E. Purpose of loan: purchase raw materials, daily working capital.

F. Principal repayment plan:

All principal shall be repaid by the final maturity date, and will be repaid in lump sum at maturity.

 

If repaid in installment per the following plan, and the specific repayment plan in the loan receipt approved by the Bank of Beijing shall prevail (unit: RMB):

 

	
XXX

	  

 

  

3

  

 

G. Interest repayment plan:

All interest shall be repaid by the final maturity, and will be repaid by installment during the loan period on the 21st day of the last month of each quarter every quarter.

 

K. Borrower’s commitments on key financial indexes:

(a) The ratio of tangible net assets (paid-up capital stock plus capital accumulation fund) to total liability does not exceed [XXX%];

(b) Minimum net assets not less than RMB (in words) [XXX%];

(c) Total annual pre-tax profits not less than RMB (in words) [XXX%];

(d) The ratio of circulating assets to circulating liabilities (i.e. current ratio) not less than [XXX%];

(e) The ratio of profits before tax and interest to interest expenses (interest coverage ratio) not less than [XXX%].

M. Guarantee (the guarantee document shall prevail):

Surety guarantee: name of guarantor: Beijing Zhongguancun Sci-tech Guaranty Co., Ltd.

U. Appendix (loan receipt and the following appendix are part hereof): XXX.

W. Compulsory enforcement notarization:

No compulsory enforcement notarization is required for this contract.

X. Special agreement:

 

	
     Blank

	  

 

Y. The Borrower hereby acknowledges that: Bank of Beijing has drawn his attention to clauses relating to responsibility or rights limitations, and has given full explanations and descriptions of the contract, and that revision and addition (if any) agreed between both parties have been stated in the special agreement column or supplementary agreement; through full review and discussion with Bank of Beijing, the Borrower fully understands and agrees all contents hereof including Terms and Conditions of Loan Contract, General Terms and Conditions and Appendix of Contract, without doubts or objections.

Z. Signing of both parties:

	
Borrower (seal)

	
Bank of Beijing (seal):

	  	  
	
Legal representative

	
Responsible person

	
Or Authorized representative:

Liu Yabin

	
Or Authorized representative:

Yu Guirui

 

  

4

  

 

General Terms and Conditions for Loan Contract

1. Definitions and explanations

1.1 Unless otherwise expressly noted, the following terms in this contract shall have the following meanings:

 

This contract: refers to the whole part consisting of all of the following documents: Terms and Conditions of Loan Contract (Clauses A-Z as main contents), General Terms and Conditions of Loan Contract, loan receipt signed by both parties, other appendixes of contract listed in Clause U hereof, and other documents (including, but not limited to, supplementary agreement, commitment letter, etc.) which legally and effectively determine both parties’ rights and obligations under this contract; however, it specially refers to the corresponding clauses of Terms and Conditions of Loan Contract and General Terms and Conditions of Loan Contract when clauses hereof are cited without different description.

Base interest rate: it refers to the legal base interest rate for RMB loan of corresponding period issued by the People’s Bank of China (if the legal base interest rate of such period is cancelled, then the base interest rate determined and issued by the Bank of Beijing shall prevail); base interest rate over the same period refers to the base interest rate determined as per the agreed period as defined in Clause B.2.

LIBOR (HIBOR): it refers to the London (Hongkong) Interbank Offered Rate issued on relevant webpages of authoritative financial telecommunications such as Reuters or Bloomberg at about 11am of London (Hongkong) time on the very day. The data of the previous last day shall prevail if the above interest rate data is not available.

Entrusted Payment: based on the Borrower’s withdrawal request and entrusted payment authorization, Bank of Beijing shall transfer the loan funds to the transaction counterparties through the Borrower’s account, in accordance with agreed loan purpose under this contract.

Self Payment: based on the Borrower’s withdrawal request, Bank of Beijing shall transfer the loan funds to the Borrower’s account, then the Borrower shall make payment directly to the transaction counterparties, in accordance with agreed loan purpose under this contract.

Guarantee documents: they refer to any documents such as guarantee contracts, guarantee clauses and guarantee letter, and commitments signed or agreed by guarantor for setting guarantee.

Laws and regulations: they refer to the laws, administrative regulations and judicial interpretations by the Supreme People’s Court applicable to the mainland of the People’s Republic of China, other than Hongkong, Macao and Taiwan.

 

  

5

  

 

Financial rules: they refer to the rules, regulations and instructions given by the bank regulatory bodies, the People’s Bank of China and foreign exchange management department.

Working day: it refers to any day on which commercial banks in the city where the Bank of Beijing is located provide services for corporate customers, excluding legal festivals and holidays, Saturday and Sunday, but including Saturday and Sunday on which the public shall work as per government’s temporary regulation.

Corresponding date: corresponding date by month refers to the same date each month corresponding to the first loan withdrawal date under this contract (if no corresponding date, refers to the last date of the month). Corresponding date by quarter refers to the same date in the last month of each quarter corresponding to the first loan withdrawal date under this contract (if no corresponding date, refers to the last date of the last month of each quarter). Corresponding date by year refers to the same date each year corresponding to the first loan withdrawal date under this contract (if no corresponding date, refers to the last date of that particular month).

1.2 Any terms having been defined in this contract shall have the same meaning in any document hereunder or made as per this contract, unless otherwise expressly specified in the document.

2. Loan

2.1 See Clause B hereof for the loan currency, amount and loan period under this contract. The specific amount of each loan which actually occurs hereunder shall be the amount stated on the loan receipt, which constitutes part hereof.

2.2 The Borrower may withdraw a loan in the withdrawal period agreed in Clause D hereof, and change of withdrawal plan shall be subject to the consent of the Bank of Beijing. Any loan amount not withdrawn after expiry of the withdrawal period will be cancelled automatically and may not be withdrawn any more. Whenever the Borrower requests a withdrawal, the Bank of Beijing shall not be obliged to grant a loan, unless all of the following conditions are met:

(1) The guarantee document specified in Clause M hereof has been made, with handover and registration procedures completed.

(2) The Borrower has completed account opening and other procedures reasonably required by the Bank of Beijing, and has provided the Bank of Beijing with documents and relevant certificates reasonably stating its specific capital use and capital flow arrangement, and the Bank of Beijing has raised no objections after review. When this Contract is a credit contract as stated in Clause A, sufficient available limit shall be reserved for the Borrower hereunder.

 

  

6

  

(3) No defaults hereunder are performed by the Borrower, and no defaults hereunder are performed by the guarantor.

(4) Laws and regulations, financial rules and national credit policy effective at that time neither impose significant influences on contract performance by one party hereto, nor prohibit or restrict loan granting or withdrawal hereunder.

(5) Other conditions as agreed herein or in laws and regulations and financial rules.

2.3 If the Borrower meets withdrawal conditions, the Bank of Beijing shall grant a loan in full amount within 3 working days. The loan shall be deemed as having been withdrawn and used by the Borrower once the loan is transferred to the Borrower’s account, and the day shall be the withdrawal day of this loan and the loan interest shall commence from that day as per the contract interest rate. When an RMB loan is withdrawn in several times, the contract interest rate shall be determined for each withdrawal respectively based on the base interest rate over the same period on the very day and the floating range stated in Clause C.1 hereof.

If using the entrusted payment method through Bank of Beijing, (i) the Borrower shall at least 3 working days in advance (or other period reasonably agreed by Bank of Beijing) provide completed commercial contracts and other related transaction documents (including but not limited to transaction subject being clear with complete signature, filling out standardized transaction documents or evidence). Before releasing loan funds, Bank of Beijing shall verify whether the above info meets the agreed conditions in this contract. After Bank of Beijing’s verification, the loan funds shall be transferred to the Borrower’s transaction counterparties through the Borrower’s account (no need for the Borrower to separately provide settlement evidence). The Borrower shall make a good record. The time when the loan funds arrives at the account of the transaction counterparties shall be determined in reference to the arrival time of the exchange settlement  as well as the opening time of the related system. The transaction fees based on Bank of Beijing’s rate standard effective at the time of payment shall be deducted from the Borrower’s account by transaction or in aggregate by Bank of Beijing (unless the Borrower takes the initiative to pre-pay separately); (ii) the Borrower shall be responsible for any delay in loan withdrawal or entrust payment caused by the incomplete, unqualified, untimely information submitted by the Borrower or there is reasonable doubt regarding the information; (iii) Due to the Borrower’s abnormal account status, the Borrower’s transaction counterparties’ incomplete, inaccurate or abnormal account status, inter-bank payment or settlement systems, or other problems unrelated to Bank of Beijing, after arriving in the Borrower’s bank account the loan funds cannot pay to or arrive in time at the Borrower’s transaction counterparties’ accounts. Any transaction fees, loan interest or other negative consequences such as loss and delay resulting from the above scenarios shall be borne by the Borrower. But Bank of Beijing shall use reasonably efforts to continue the payment procedures, or leave funds in the Borrower’s account/pending account and notify the Borrower to complete the relevant procedures.

 

  

7

  

If using the self payment method, the Borrower shall provide timely loan usage plan as required by Bank of Beijing, and after loan withdrawal shall within the 10th day of each month provide aggregated fund payment info to Bank of Beijing. Bank of Beijing shall have the right to analyze the account, verify the fund transfer evidence or on-site investigation in order to confirm whether the loan fund payment is in accordance with the terms of this contract. The Borrower shall cooperate.

The loan funds shall be entrusted to pay through Bank of Beijing or the Bank of Beijing shall be able to monitor usage. Before the debt in this contract is fully repaid, Bank of Beijing shall have the right to refuse to sell checks, conduct deposit and withdrawal, open internet banking, phone banking or other methods for monitoring related accounts and the fund usage within the accounts.

During the loan payment process, if Bank of Beijing finds that the Borrower experiences credit decline, its main business profitability is not strong or has unusual usage of loans, Bank of Beijing shall have the right to request change in how loan funds are used. The Borrower shall accept and cooperate.

2.4 As the loan hereunder is a loan with floating interest rate, the contract interest rate shall float during the loan period in such a manner: (i) for an RMB loan, the contract interest rate shall be adjusted automatically and calculated in sub-stage in accordance with the base interest rate over the same period applicable at that time and the floating range as stated in C.1 hereof, from corresponding date (first day of each calendar month, first day of each calendar quarter, and Jan. 1 of each year) respectively, in the adjustment frequency (as per month, quarter and year) as agreed in C.1 hereof; (ii) in case of foreign currency loan, the contract interest rate for each interest period (including the first day and excluding the last day) shall be the LIBOR (HIBOR) rate (annual interest rate expressed in percentage) for corresponding currency and period on the second business day of such foreign currency one day prior to the starting day of such interest period, plus the increased base point value (100 BPs as 1%) agreed in C.2 hereof; automatic interest rate adjustment above shall not be deemed as change to the contract. When the contract interest rate is converted from annual interest rate to daily interest rate, Hongkong dollar shall be calculated as per 365 days a year, and RMB and other currencies shall be calculated as per 360 days a year.

2.5 The Borrower warrants that this loan will be used for the purpose as stated in Clause E hereof, and warrants that such use purpose will not be in violation of provisions of laws and regulations and financial rules; the Borrower undertakes that it will not use this loan in items or services where use of commercial bank loans is prohibited by laws and regulations or financial rules. The Borrower shall obtain a written consent of the Bank of Beijing prior to change of use purpose.

 

  

8

  

2.6 The Borrower shall repay the principal of this loan as agreed in Clause F hereof, and repay loan interest as agreed in Clause G; an interest period shall commence from each interest repayment day (including) to the next interest repayment day (excluding) (the first interest period commences from the withdrawal date and the last interest period ends at maturity of the principal); When each loan principal is repaid, all interests incurred by such principal shall be settled, and all principal, interests and other amounts payable shall be settled on maturity. In case of non-working day, the Borrower shall deposit sufficient amount of money in its account in advance so that the Bank of Beijing can deduct from its account on the very day or on the sequent first working day after extension. Interest will be calculated as per the contract interest rate during such extension.

2.7 In order to repay relevant the amounts payable in a timely manner, the Borrower shall open and always maintain in the Bank of Beijing an account as stated hereof (in case of change of account, the changed account shall apply to this contract continually), and shall deposit full amount of money repayable to such account for deduction by the Bank of Beijing. The Borrower may also directly transfer money to its Bank of Beijing account for repayment, and shall timely notify the Bank of Beijing of such service No. for the repayment. The Bank of Beijing may, at its discretion, deduct any amount payable from any account the Borrower has opened in the Bank of Beijing Company system, and will notify the Borrower of such deduction in the form of bank account or other forms.

 

2.8 Unless otherwise there are substantial and sufficient opposite evidences, the bank voucher generated by the Bank of Beijing shall be effective evidence for loan granting and principal repayment hereunder.

3. Advance repayment and extension

3.1 The Borrower may not repay money during the withdrawal period. If the Borrower requests advance repayment after the withdrawal period, the Borrower shall, 30 days in advance, submit to the Bank of Beijing an irrevocable written application stating the proposed principal amount for advance repayment and the repayment plan for the remaining loan principal; where the Bank of Beijing consents in writing after review, the Borrower shall perform advance repayment on the advance repayment date, pay to the Bank of Beijing advance repayment compensation as specified in Clause N.1 hereof (advance years shall be the quotient obtained by dividing the actual day number from advance repayment date to the agreed maturity date by 365, with two decimals reserved), and settle all interests incurred by advance repaid principal and other amounts overdue. The remaining principal (if any) shall be repaid as per the new repayment plan consented by the Bank of Beijing (the last repayment date shall still be no later than the last maturity date). Where the Borrower fails to submit or both parties fail to reach a new repayment plan, reverse repayment shall apply (i.e. the advance repaid capital will be used to repay the amount that will be overdue at last); the contract interest rate shall not be adjusted by virtue of advance repayment or as per the period determined in the new repayment plan.

 

  

9

  

3.2 Where the Borrower requests an extension, the Borrower shall, at least 30 days before the maturity date, submit to the Bank of Beijing a written extension application stating extension reasons and repayment capital arrangement after such extension. After the Bank of Beijing consents through review and the Borrower meets the conditions required by the Bank of Beijing, both parties shall sign an extension agreement, with extension procedures handles as per such agreement. If the Bank of Beijing does not agree on extension or both parties fail to sign an extension agreement, the Borrower shall still perform repayment as agreed herein.

3.3 During the loan period, Bank of Beijing shall have the right to request the Borrower to prepay, based on the Borrower’s return of funds situation (including but not limited to the early return of funds marked for repayment, the Borrower’s available liquidity after repayment is sufficient for normal funding requirement, etc.). After the prepayment notice by Bank of Beijing arrives at the Borrower, the loan principal and interest is due on the date of prepayment designated by Bank of Beijing, and the Borrower shall timely repay as requested.

4. Commitment and guarantee

4.1 Both parties hereby undertake and guarantees to the other party that: (1) The party has the qualification and ability to enter into and perform this contract, and the person who signs this contract on behalf of the party has been fully authorized to enter into this contract; (2) The conclusion and performance of this contract by the party are not in breach of organization documents such as regulation, laws and regulations and financial rules and other law documents it shall observe, and the party has obtained any necessary internal and external authorization, permission and filing so that this contract is legally binding to the party and lawfully enforceable.

4.2 The Borrower undertakes and guarantees to perform the following obligations before performance of this contract is completed:

(1) The Borrower is always a legal entity that is established lawfully and operates continually, and will handle legal procedures such as annual inspection. The borrower shall, prior to conclusion of this contract and application for withdrawal each time, submit to the Bank of Beijing true and complete information regarding financial and operation conditions of the Borrower and other important information in connection with this contract.

 

(2) The Borrower shall have sufficient and legal repayment sources that match with the repayment plan, and sufficient repayment capability, and ensure that relevant capital and resources support under the production and operation projects for which loan is used are in place timely and in full amount so that the projects can go on smoothly.

(3) Production and operation comply with laws and regulations, environmental protection requirements, tax regulations set forth in laws and regulations and other provision, and necessary approval and permission documents are obtained timely and lawfully and effectively.

 

  

10

  

(4) The Borrower accepts and actively coordinates the Bank of Beijing’s inspection and supervision concerning its financial and operation conditions, and the use of loan hereunder, including, but not limited to: (i) reasonably stating the capital flow of each loan hereunder as required by the Bank of Beijing, providing relevant repayment voucher and evidence, and proving conformance to this contract; (ii) by the end of April each year, submitting to the Bank of Beijing complete audited financial statements (including notes) of previous year and audit reports, and submitting, the first month of each quarter, to the Bank of Beijing copies of financial statements such as balance sheet, profit and loss statement, and cash flow statement (in case of audited half-year or quarterly financial statements, the complete audited statements and audit reports shall be provided).

(5) All application information, financial statements and other information provided to the Bank of Beijing are true, complete, lawful and effective, without any fraud, significant omission or misleading.

(6) Where the Borrower performs merger, division, reduces registered capital, applies for close of business for rectification/ takeover / disbanding / bankruptcy or items that affect the existence of the applicant or its continual operations, the Borrower shall, at least 30 days in advance, notify the Bank of Beijing of such item and obtain the Bank’s written consent; if a third party requests or an administrative/judicial organ orders the Borrower to close its business for rectification / takeover / disbanding / bankruptcy, or suspend or cancel its operation license for main operating business or major business, the Borrower shall notify in writing the Bank of Beijing of such condition as soon as possible (no later than 3 working days) after notification, and take measures timely for remedy.

(7) When the Borrower makes any changes to industrial and commercial registrations, top ten shareholders, directors, financial officer, or contact address, it shall notify the Bank of Beijing of such item as soon as possible (no later than 5 working days).

(8) Where the Borrower provides any guarantee (or liability responsibility or similar arrangement of guarantee nature) for a third party or reaches with a third party partner / contracting operation, waiver of significant creditor’s rights, acquisition for restructuring, transfer of main business or similar significant transaction that may reduce the Borrower’s repayment capability, the Borrower shall obtain written consent from the Bank of Beijing in advance, except that the above items will not impose significant adverse influences on the Borrower’s capability to perform this contract and that the total amount or total guarantee amount of the above-mentioned significant transaction does not exceed 30% of total assets of the Borrower and 50% of its net assets.

 

  

11

  

(9) The Borrower shall notify timely in writing the Bank of Beijing of any affiliated transaction with a total amount up to or exceeding more than 10% of its net assets (affiliated parties and affiliated transaction shall be identified in accordance with Chinese accounting standards or international accounting standards lawfully applicable to the Borrower), including: affiliating relations of transaction parties, transaction items and property, transaction amount or corresponding proportion, pricing policy (including transactions with no amount or with only symbolistic amount), etc. and the Borrower shall not perform affiliated transaction in which registered capitals are withdrawn, bank capital or credit is obtained through fictitious transaction, liabilities are evaded through asset transfer, or transactions that severely impair its repayment capability or illegal transactions such as money laundering.

 

(10) The Borrower shall always observe the commitment as stated in Clause K hereof, and will maintain in agreed scope relevant financial indexes (calculated in accordance with Chinese accounting standards or international accounting standards lawfully applicable to the Borrower).

(11) The Borrower will not distribute dividend or bonus to shareholders in any form when the net profit after tax of an accounting year is zero or negative, or the net profit after tax is not sufficient to cover the accumulative losses of previous accounting years, or when the profit before tax is not sufficient to settle next loan principal repayable.

(12) The Borrower shall, no later than the first withdrawal date, provide the Bank of Beijing with the Guarantee as agreed in Clause M hereof, see guarantee document for details. The Borrower warrants to maintain the pledge rate and mortgage rate thereunder in the range (if any) as agreed thereunder; the Borrower undertakes that it fully understands, agree and accepts the clauses and contents contained in relevant guarantee documents, and warrants that all guarantees submitted to the Bank of Beijing based on relevant guarantee documents are lawful, effective and lawfully enforceable.

5. Expenses of taxation

The Borrower and the Bank of Beijing shall bear the stamp tax payable hereunder respectively. The taxes and administrative fees imposed by the government or organs exercising administrative management authority (except those taxes the Bank of Beijing shall bear lawfully on its own) and notarial fees (if any), and guarantee fees (if any) shall be borne by the Borrower.

6. Default and remedy measures

6.1 The occurrence of any one or more of the following shall constitute default of the Borrower:

 

(1) The Borrower fails to use the loan as agreed herein, or fails to repay, on schedule and in full amount, the interest, principal or other amounts payable.

 

  

12

  

(2) The Borrower fails to (or states expressly or indicates by act that it will not) completely perform any commitment, guarantees, obligations or responsibilities hereunder in an appropriate way.

(3) Any guarantor fails to completely perform any commitment, guarantees, obligations or responsibilities under the guarantee document in an appropriate way, or other default events under the guarantee document occur, or the mortgage / pledge (if any) experiences damage, loss, transfer of ownership, seal up / freezing / seizure or enforcement, or the guarantee document or the guarantee right of the Bank of Beijing is identified as invalid, cancelled or rescinded without written consent of the Bank of Beijing.

(4) Any significant credit financing, guarantee, indemnification or other repayment obligation of the Borrower cannot be performed at maturity, or the operating license for the main business or major business is suspended or cancelled, or the Borrower is involved in procedures such as close of business for rectification / takeover / disbanding / declaration of bankruptcy.

(5) The Borrower’s financial or operating conditions experience significant adverse changes, or produce bad credit records, or are involved in disputes or administrative penalty that may impose significant adverse influences on its repayment capability or the performance of this contract, or other conditions occur that may impose severe adverse influences on the creditor’s right or security interest.

6.2 Where the Borrower fails to repay, on schedule and in full amount, any loan principal and interests payable or other amounts payable, additional penalty interest for the unpaid amounts shall be paid as per day at 150% of contract interest rate applicable for the same period (overdue penalty interest rate); where the Borrower uses a loan for a purpose that does not comply with contract provisions or provisions set forth in laws and regulations or financial rules, it shall immediately repay the principal and interest for the above loan used in breach of contract, and additional penalty interest for such loan shall be paid as per day for the breach period at 200% of contract interest rate applicable for the same period (appropriation penalty interest rate); where the loan is used in breach of contract and is also overdue, appropriation penalty interest rate shall apply. Penalty interest as state above does not influence other breach remedy rights of the Bank of Beijing.

6.3 Should any breach event hereunder occur to the Borrower, the Bank of Beijing shall have the right to exercise its breach remedy rights as agreed herein or in accordance with provisions set forth in laws and regulations and financial rules, including, but not limited to, requirement for correction of breach, stopping granting loan, payment of penalty interest, exercise of security interest and right of lien according to law, declaration of immediate maturity of whole or part debt hereunder, declared collection, requirement for compensation of loss and payment of all expenses and fees (including, but not limited to, law expenses/arbitration expenses, disposal expenses such as evaluation / appraisal/auction, attorney fee, investigation fee, travel expenses and other reasonable fees) to the Bank of Beijing incurred in connection with realization of creditor’s right and security right.

 

  

13

  

6.4 Where the currency of amount collected by the Bank of Beijing for exercising rights differs from the currency of the amount unpaid by the Borrower, such amount shall be exchanged at the exchange rate issued by the Bank of Beijing for the currency of amount sold and unpaid and currency of amount purchased and collected, to settle creditor’s right of Bank, and any exchange rate loss and fees for exchange so incurred shall be borne by the Borrower. The Borrower shall be obliged to coordinate in handling exchange procedures.

6.5 The amounts collected by the Bank of Beijing for exercising rights shall settle its creditor’s rights in the following sequence: (1) expenses and fees for realization of creditor’s rights and security interest, and other fees that the Borrower shall bear, (2) damages, compensation and penalty, (3) penalty interest, (4) loan interest, (5) principal, (6) other amounts payable; however, the Bank of Beijing may change the said settlement sequence. If the Borrower has many amount payable, the settlement sequence determined by the Bank of Beijing shall prevail.

6.6 Where one party undergoes force majeure and has provided the other party with evidence issued by authoritative organ within 5 working days after occurrence, corresponding liabilities for breach of contract may be exempted according to laws, however, in order to avoid doubt, both parties hereby conform that corresponding liabilities for breach of contract may be exempted when the Borrower undergoes force majeure, however, the Borrower shall still have the obligation to repay the principal of loan withdrawn, loan interest calculated as per contract interest rate and fees for realization of creditor’s rights and security interest.

 

7. Governing laws and dispute settlement

7.1 This contract shall be governed by the laws and regulations of the People’s Republic of China; and all disputes hereunder and in connection with this contract shall be settled through friendly consultation. If no agreement is reached, the dispute may be referred to the people’s court of the place where the Bank of Beijing is located.

7.2 Where the guarantee document contains express written agreement regarding law application and dispute settlement thereunder, such agreement applies. If there is not written agreement, or written agreement is not express, or the agreement is invalidated or cancelled according to laws, the laws and regulations of the People’s Republic of China apply and the disputes may be referred to the people’s court of the place where the Bank of Beijing is located.

 

  

14

  

8. Supplementary articles

8.1 This contract is a specific business contract under relationship contract (if any) as stated in Clause A hereof. Items not mentions herein shall be subject to provisions under the relation contract. In case of any discrepancy between the two, this contract shall prevail. Where there are discrepancies between the special agreement in Clause X hereof and other clauses of body hereof, the special agreement shall prevail; the appendixes as listed in Clause U hereof shall constitute part of this contract. Unless otherwise expressly agreed in writing in the body of this contract or appendixes hereof, the body of this contract shall prevail in case of any discrepancy between such appendixes and the body of this contract.

8.2 Where any party sends a notice or document hereunder: (1) in form of personal delivery or entrusted delivery, the delivery date shall be the date on which the notified party or its receipt agent signs for receipt; (ii) in form of express mail service or intracity registered mail (including municipal area and suburb), the delivery date shall be the third day after the mail is sent; (iii) in other mail methods, the delivery date shall be the seventh day after the mail is sent; if there is discrepancy between the delivery date as determined as per provisions above and the actual receiving date or formal signing date of the notified party, the earlier date shall prevail. However, in order to avoid any doubt, both parties hereby confirm that any document which the Bank of Beijing requires the Borrower to submit personally shall be directly submitted by a designated person to the person authorized by the Bank of Beijing. Any party who changes its contact way shall notify the other party; otherwise the other party shall still have the right to deem the contact way prior to such change as valid.

8.3 The Bank of Beijing may provide information regarding this contract to the credit system and information base established through powerful government departments.

8.4 Unless otherwise agreed herein, any party shall be obliged to keep confidential any commercial secrets procured during conclusion and performance of this contract and belonging to the other party, and other undisclosed information the party expressly requires keeping confidential before the above information loses privacy. Without written permit of the other party, such information shall not be publicly disclosed or disclosed to any third party; However, disclosure by one party of such information in accordance with provisions of relevant laws and regulations, as required by powerful organs or the exchange where listing is made, or as reasonably required by this contract to this party’s auditor, financial advisor, legal advisor or other intermediaries (such party shall ask such intermediaries and their staff to assume confidentiality obligation) shall not be deemed as default of confidentiality obligation.

 

  

15

  

 

8.5 The effect of this contract is independent of guarantee document, relationship contract (if any) and any contract / agreement / commitment, without being influenced by the validity and enforceability of the above documents. Where any clauses or contents hereof are cancelled or identified as being invalid according to laws, the effect of other clauses and contents shall not be influenced and still remain valid. Failure to exercise corresponding remedy rights by the other party in case of default by one party shall not be deemed as waiver of such rights or permit of such default.

8.6 This contract is entered into by and between the Borrower and the Bank of Beijing on the contract signing date at the place of domicile of Bank of Beijing, and shall take effect after it is signed by the legal representative / responsible person / authorized representative and sealed with company seal (or contract seal recognized by a document with company seal). This contract is made in three originals (corresponding number of originals shall be signed if notarization is required or if guarantee registration procedures are handled), with the Bank of Beijing holding two originals and the Borrower holding one original. Each original has equal legal effect. In case of guarantor, the Borrower shall be responsible for provide a copy of this contract for the guarantor, however, failure to do so by the Borrower will not impose adverse influences on the Bank of Beijing’s creditor’s rights and security interests.

(No additional contents below)

 

  

16

  

             Bank of Beijing

4-063

C12026

Contract Number:  0174170

Loan Entrust Payment Instruction

  

Bank of Beijing, Shangdi Branch: 

In accordance with the "Loan Contract" Number: 0174170 signed by both our company (the Borrower) and your bank, your bank has or will shortly transfer loan funds in accordance with “Loan Receipt” Number: 0174170 to our bank account opened at your branch (account name: Beijing Wowjoint Machinery Co. Ltd., account number: 01090946300120102114378, bank opening branch: Shangdi Branch).

    

We unconditionally and irrevocably consent to entrust your bank to pay out the loan funds under this application using the following details, in accordance with your bank’s examination agreed in this contract: 

 

	
Order

 

No.

	
Payee Account Info

	
Payment Amount (Currency: RMB)

	
Bank Branch

	
Account Name

	
Account Number

	
In Figures

	
In Numbers

	
1

	
ICBC Beijing, Dewai Branch

	
Beijing Runtuo Industrial Technology Co. Ltd.

	
0200001309020152337

	
Five Million

	
5,000,000

	
2

	  	  	  	  	  
	
3

	  	  	  	  	  
	
4

	  	  	  	  	  
	
5

	  	  	  	  	  
	
6

	  	  	  	  	  

☐ Please see other payment details related to this Instruction on appendices stamped with seal.

Please examine and execute this instruction. Other transaction documents will be submitted separately.

Loan funds reserved seal:

Bank branch checked and confirmed seal:

The Borrower (stamped seal):

Legal representative/authorized signatory (signature or seal): Liu Yabin

Date of Application: 2013.08.07 

 

 

17

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00232-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00232-of-00352.parquet"}]]