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[BANK OF CHINA HONG KONG BRANCH LETTERHEAD]
EXHIBIT 10.4(a)
Ref: CD/CI/910250/LS/rk
May 27, 1991
Zindart Industrial Company Limited,
Flat C & D, 25/F, Block 1,
Tai Ping Industrial Centre,
57 Ting Kok Road,
Tai Po,
New Territories.
Attn: Ms. Domina Leung
Dear Sirs,
Re: General Banking Facilities
We are pleased to offer you General Banking Facilities ("the Facilities") on
the following terms and conditions.
1. Allocation of the Facilities
1.1 The Facilities are available by way of:-
(a) Overdraft Facility up to the extent of HKD1,000,000.00. Interest
will be charged at 2% per annum over our best lending rate or
cost of fund, whichever is the higher, currently 12.5% p.a.,
subject to fluctuation at our sole and absolute discretion;
(b) Letters of Credit Issuance and Inward Bills Facility up to the
extent of HKD3,000,000.00 (within which Trust Receipt Facility
for period up to 120 days and/or Shipping Guarantees Issuance
Facility up to the extent of HKD2,000,000.00 is available).
1.2 The abovementioned Facilities shall be deemed automatically drawn down
by you and/or advanced by us to you when payment is made by us under
the relevant Facilities.
1.3 Without prejudice to Clause 3, we reserve the right at any time to
re-allocate at our sole and absolute discretion the various banking
facilities.
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[BANK OF CHINA HONG KONG BRANCH LETTERHEAD]
2. Interest Rate and Calculation
2.1 Save and except expressly provided otherwise in this letter, all amounts
advanced/drawn under the Facilities shall be charged with interest at the
relevant usual standard rates (as well after as before judgment) as we
may from time to time at our sole and absolute discretion charge our
customers on similar advances.
2.2 Interest will accrue from day to day and be calculated on the basis of
the actual number of days elapsed and a 365 day year for Hong Kong Dollar
and Sterling Pound and a 360 day year for any other currency.
2.3 All accrued interest shall be paid in arrears on any appointed date
according to our customary practice and if not so paid shall be
capitalized as principal advance and bear interest at the same rate.
2.4 We reserve the right to collect default interest on any sum overdue and
not paid which will be charged at the rate of 4.25% p.a. over the best
lending rate as may be quoted by us from time to time (as well after as
before judgment) from the date of default to actual payment in full.
3. Expiry of the Facilities
The Facilities will be subject to review on a regular basis and shall
expire forthwith as and when we have given you notice of termination.
Whilst it is our present intention that the Facilities should remain
available to you until that date and notwithstanding any other provision
of this letter, we nevertheless reserve the right at our sole and
absolute discretion to increase, reduce and/or vary the Facilities or any
part or parts thereof at any time to be effective forthwith by notice to
you.
4. Repayment
4.1 All amounts borrowed under the Facilities (including interest accrued
thereon) are repayable on demand.
4.2 All payments made by you to us are to be made in the currency of the
Facilities in immediately available funds without set-off or
counter-claim and free and clear of and without withholding or deduction
for any and all present or future taxes, duties or other charges.
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[Bank of China, Hong Kong Branch Letterhead]
4.3 Any payment made to us not in its correct currency may at our absolute
discretion be converted into the currency of the relevant Facilities to
cover your obligations and liabilities in that currency at the then
prevailing spot rate of exchange as conclusively determined by us for
purchasing the currency of the relevant Facilities with the existing
currency.
5. Conclusive Statement of Account
Any statement of account relating to the Facilities signed as correct by
any one of our officers shall be conclusive evidence of your
indebtedness to us and be binding on you, save for manifest errors.
6. Conditions Precedent
The Facilities will be available for drawing when we have received the
following documents in form and content satisfactory to us:
(a) The signed copy of the duplicate of this letter together with board
resolutions indicating your acceptance of the Facilities on terms
and conditions set out in this letter;
(b) An Agreement of Pledge duly executed by your authorized officer(s);
(c) A Running Trust Receipt Agreement duly executed by your authorized
officer(s);
(d) A General Shipping Guarantee duly executed by your
authorized officers(s);
(e) A General Letter of Hypothecation and Power of Attorney duly
executed by your authorized officer(s);
(f) A deposit for HKD1,000,000.00 (interest to be accumulated) with
Bank of China, Hong Kong Branch in name of Zindart Industrial
Company Limited under lien to us.
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[BANK OF CHINA HONG KONG BRANCH LETTERHEAD]
7. Further Covenants
All necessary corporate resolutions required to be passed by you and on
the part of your shareholders, directors and officers to authorize this
letter and its execution and performance have been properly passed in
accordance with the laws of Hong Kong and your Memorandum and Articles
of Association and this letter constitutes legal, valid and binding
obligations on your part.
8. Waivers and rights cumulative
No delay or omission on the part of us in exercising any right, power,
privilege or remedy in respect of this letter shall impair such right,
power, privilege or remedy, or be construed as a waiver of it, nor shall
any single partial exercise of any such right, power, privilege or
remedy preclude any further exercise of it or the exercise of any other
right, power, privilege or remedy. The rights, powers, privileges and
remedies provided in this letter are cumulative and not exclusive of any
rights, powers, privileges or remedies provided by law.
9. Handling Charges
Handling charges of HKD5,000.00 flat shall be paid by you upon
acceptance of this letter.
10. Expense
All expenses including but not limited to legal fees, communications and
other out-of-pocket expenses are for your account.
11. Governing Law
The laws of Hong Kong.
Please signify your understanding and acceptance of this offer by signing and
returning the duplicate of this letter to us on or before June 27, 1991,
failing which this offer shall lapse.
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[LETTERHEAD]
Bank of China
Should you have any queries, please do feel free to contact our Ms. Lian Chin
at 8265545 at any time. We are here to serve you better.
Yours faithfully,
For Bank of China, Hong Kong Branch
/s/ [signature illegible]
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Authorized Signature(s)
After due and careful consideration of the terms of
this letter, we agree to observe and be bound by all
the terms and conditions herein set out.
For and on behalf of
ZINDART INDUSTRIAL CO., LTD.
/s/ [signature illegible]
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Date: June 13, 1991
[STAMP]
For and on behalf of
ZINDART INDUSTRIAL CO., LTD.
/s/ [signature illegible]
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Director(s)
[STAMP]
[illegible]