Loan Agreement Summary between Shenzhen BAK Battery Co., Ltd. and Agricultural Bank of China (Shenzhen Eastern Branch)
Shenzhen BAK Battery Co., Ltd. entered into a loan agreement with the Shenzhen Eastern Branch of the Agricultural Bank of China on October 23, 2006. The agreement provides for a total loan of RMB 34 million, split into two parts with different maturity dates in April 2007. The loan carries a fixed interest rate of 5.58%, with higher penalty rates for late repayment or misuse of funds. The loan is intended for working capital, and early repayment requires lender approval. Breach of contract may result in penalties, early repayment demands, and reimbursement of the lender's legal and related costs.
Exhibit 10.2
Summary of Loan Agreement entered into by and between Shenzhen BAK Battery Co., Ltd. and Shenzhen Eastern Branch, Agricultural Bank of China dated October 23, 2006.
Summary of the main articles
| • | Contract number: NO.81101200600001775 | |
| • | Loan Principal: RMB 34 million; | |
| • | Loan term: the loan RMB 20 million was from October 23, 2006 to April 15, 2007, and the other loan RMB 14 million was from October 23, 2006 to April 22, 2007. | |
| • | Interest rate: fixed rate of 5.58%; | |
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| • | Penalty interest rate for delayed repayment: 5.58% plus 50% *5.58%; |
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| • | Penalty interest rate for embezzlement of loan proceeds: 5.58% * 2; |
| • | Purpose of the loan is to provide working capital for the Company; | |
| • | Advanced repayment of loan needs to be approved by the Lender; | |
| • | Breach of contract penalties: suspension of loan un-provided, demand prepayment of loan principal and interest before maturity; imposition of punitive interest; compensation for the Lender’s expenses incurred due to the Company’s breach of contract such as lawyer’s fee, travel cost in case of litigation, etc. | |
Summary of the articles omitted
| • | Types of the loan |
| • | Clearing of the loan interest |
| • | Condition precedent to the drawing of the loan |
| • | Rights and obligations of the borrower |
| • | Rights and obligations of the lender |
| • | Guarantee of the loan |
| • | Dispute settlement |
| • | Miscellaneous |
| • | Validity |
| • | Notes |
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