Guarantee Contracts

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					TA3493-PRC Development of an SME Credit Support System                  Draft Final Report


                                  Guarantee Contract

                                                           Contract No.


Guarantor (herewith as “Party A”):        China National Investment & Guarantee Co.
Ltd. Shanghai Branch (“I&G”)

Legal                                                                            address:
___________________________________________________________

Legal
representative:______________________________________________________

Telephone: ____________________            Fax:   ___________________     Post     code:
_______________

Lender (herewith as “Party B”)

Legal                                                          address:
_________________________________________________________________

Legal                                                     representative:
____________________________________________________________

Telephone:  ___________________            Fax:    _________________      Post     code:
_________________


With the Borrower __________________________’s application, Party A agrees to
provide guarantee in the form of guarantee for “RMB Borrowing Facility” with contract
No. (as principal contract) signed between borrower and Party B on the date of
__________________. After reviewing, Party B agrees Party A as a guarantor of
borrower. In terms of rules regulated by Government Law, after mutual negotiation,
both Party A and B work out this contract according to the following articles.

Article 1:  according to the principle contract signed between Borrower and Party B,
borrower borrows from Party B with the principal amount of RMB_________ (say
____________), monthly rate ____________, credit terms from yy_____ mm_____dd
_______ to yy _____ mm _______ dd _______.

Article 2:   the scope for the guarantee, and guarantee period
Party A agrees to provide guarantee for borrower with _________ % of the afore-said
principal amount of lending facility.
Party A’s guarantee period is 12 months at the expiry date of principal debt to be
exercised.
                                             1
                                                                 Appendix A 5.5. - 1
December 2001
TA3493-PRC Development of an SME Credit Support System                        Draft Final Report




Article 3:      the mode of guarantee
a.      Party A takes joint liabilities for the debt within the scope of guarantee. If
        principal contract is to exercise at the expired date, borrower doesn’t repay the
        exact amount of debt under this principal contract on time, both Party A and B
        shall discuss together. After several times’ alert with no result, Party B has the
        right to directly ask Party A to repay the debt at an agreed scope of guarantee
        within the contract at any time from the first day of overdue until to the three
        months. Party A shall on behalf of borrower repay the _______ % of principal to
        Party B within the 10 business days calculated from the date that Party A
        receives the notice from Party B.

b.     Party A doesn’t take any liabilities on any debt which is exceeded the scope of
       guarantee and guarantee period as well.

c.     Party A’s guarantee liabilities are reduced or released accordingly, with the
       situation that borrower exercises to repay the debt, or Party A on behalf of
       borrower repays the debt, or Party B takes back his lending facility because of
       borrower’s default.

Article 4:    Guarantee under this contract is for guarantor’s continuous duties. It is
not effected by any disputes, compensation and any instructions from senior-level units,
any agreements & documents signed between Party A and any units.              Also, this
guarantee doesn’t be changed due to Party A’s merge & acquisition, spin-off, operation-
suspended, cancellation, dismiss & bankruptcy etc., and due that any Parties under this
contract change their enterprises’ name, address, Contract, Article of Association, legal
representative, business scope & enterprises’ natures. If happened on the any of
above-mentioned situations, this guarantee contract continues to be valid.

Article 5:    If Party B and borrower change principal contract, or Party B transfers his
principal debt liabilities to the third party, or Party B allows borrower to transfer his debt,
should Party A provides his written approval. If violated, Party A’s guarantee liabilities
are released automatically.

Article 6:      Party B shall grant loan to borrower on time.

Article 7:    If Party B discovers that borrower doesn’t exercise to make repayment or
doesn’t full-duly exercise to make repayment regulated by principal contract, Party B
shall inform Party A, and Party B takes relevant measurement timely so as to reduce
the loss.

Article 8:    With the following situations, Party B shall take active measurement and
try to take back loans in advance. When found problems, Party B shall inform Party A
in a written paper within five days. But, Party A doesn’t exercise his liabilities in
advance for that reason.

                                              2
                                                                         Appendix A 5.5. - 2
December 2001
TA3493-PRC Development of an SME Credit Support System                       Draft Final Report


a.     Party B discovers borrowers’ other serious violation, or other debts are required
       to repay in advance.
b.     Borrower informs Party B in a written paper that he can’t repay the matured debt
       or he suggests to transfer his assets.
c.     Borrower is bankrupt announced by Judicial organs.
d.     Borrower is suited (arbitrated) by other creditor because of important debts’
       issue, or courts (arbitration organs) make judgement to seal up, freeze and retain
       borrower’s assets, or the judgement enforced by courts to exercise.
e.     The situation is sufficient to influence borrower exercising principal contract.

Article 9:     After Party A on behalf of borrower repays the debt, and he exercises his
right to force borrower to make repayment to him, Party B shall provide his assistance
on this enforcement.

Article 10:  This guarantee contract is subject to the principal contract. Because of
none creditor’s reason so as that principal contract is invalid, guarantor continues to
take guarantee liabilities.

Article 11:  Within the valid term of this contract, any parties of A & B have no right to
change or release this contract by himself. If needed to change contract’s article, both
Parties agrees to reach a written agreement after mutual negotiation.

Article 12:     Responsibilities on the violation
a.      If Party A breaks against (a) point of Article 3 of this contract, Party A isn’t on
        behalf of borrower to repay the matured debt, Party A shall pay 5% of total loan
        amount as compensation to Party B.
b.      If Party A breaks against Article 4 of this contract, Party A shall pay 5% of total
        loan amount as compensation to Party B.
c.      If Party B breaks against Article 5 of this contract, Party A’s guarantee liabilities
        are released automatically. And, Party B shall pay 5% of guarantee amount by
        Party A as compensation to Party A.
d.      If Party B breaks against Article 6 of this contract, Party A’s guarantee liabilities
        are released automatically.
e.      If Party B breaks against Article 7 & 8 of this contract, Party A has the right to
        release guarantee liabilities. And, Party B shall pay 5% of guarantee amount by
        Party A as compensation to Party A.

Article 13:   Resolution on the dispute
Dispute is happened when both Parties exercise this contract, and settled by both
Parties after negotiation. If both Parties can’t negotiate together, any Parties can file at
People’s Court at the premise of Party B.

Article 14:  This contract becomes valid and effective from the date that legal
representatives of both Parties or their respective agents sign and chop.


                                             3
                                                                        Appendix A 5.5. - 3
December 2001
TA3493-PRC Development of an SME Credit Support System                       Draft Final Report


Article 15:  This contract has one original and four copies. Both Party A & B have two
copies respectively.

Article 16:     Other articles are obligated by both Parties.


Party A: (chop)                                           Party B: (chop)

Legal representative: (signature)                         Legal representative: (signature)
(or authorized agent)                                            (or authorized agent)

Date:                                                     Date:




                                               4
                                                                        Appendix A 5.5. - 4
December 2001

				
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