Sample Business Contracts

General Banking Facilities Agreement - Natexis Banques Populaires and Bonso Electronics Ltd.

Loan Forms


12th Floor, CITIC Tower, I Tim Mel Avenue, Central, Hong Kong
Telephone : (852) 28 28 09 99 - Fax: (852) 25 83 98 01
Tlx : 80186 BFCEX

     Our ref: CCIB/SC/mch/03-L0013BONS0

     13th February 2003

     Bonso Electronics Limited
     Unit 1106-1110
     11/F, Star House
     3 Salisbury Road
     Hong Kong
     Attn.:  Mr. Hung-Gun Anthony SO

     Dear Sirs,


     We are pleased to inform that Natexis Banques Populaires, Hong Kong Branch
     (the "Lender") is prepared to make available the following uncommitted
     general banking facilities (the "Facilities") to you subject to the
     accompanying terms and conditions as stipulated in this letter (the
     "Facility Letter") and subject to the terms contained in our standard
     General Commercial Agreement, which terms shall apply to all transactions
     contemplated by this Facility Letter.

     1.   BORROWER

          Bonso Electronics Limited


          Bonso Electronics International Inc.

 Telephone : 01 48 00 48 00
 Siege social : 115, rue Montmartre - 75002 Paris
 Adresse postale : BP 265 09 - 75427 Paris Cedex 09


Societe anonyme au capital de 512 548 160 euros - RCS Paris 542 044 524


                                                                     Page 2 of 6
                                              Our Ref. CCIB/SC/mch/03-L0013BONS0

     3.   FACILITIES

          Up to USD2,000,000.00 (Say, United States Dollars Two Million only)
          available for:

     a)   Discount of export buyers' invoices with or without Export Credit
          Insurance Corporation ("ECIC") coverage up to 80% of total value of
          invoices for maximum tenor of 120 days;
     b)   negotiation of export Letter of Credit with discrepancies;
     c)   packing loan up to 70% of the value of the Export Letter of Credit
          issued by banks acceptable to the Lender up to 90 days;
     d)   purchase of Export Bills on the basis of Document against Payment
          ("D/P") and/or Document against Acceptance ("D/A") with recourse for a
          maximum duration of 90 days;

          with sub-limit oh

     e)   Up to USD1,500,000.00 available for:

          i)   the issuance of sight and/or usance Letter of Credit ("L/C") for
               a maximum usance period of 120 days;
          ii)  Trust Receipt financing ("T/R") for a maximum tenor of 120 days
               for imports under L/C issued by the Lender;
          iii) the issuance of shipping guarantee under LIC issued by the
          iv)  up to a notional sum of USD1,500,000.00 or its equivalent in
               other major convertible currencies available for Foreign Exchange
               Spot/Forward Contracts with a maximum tenor of six months;

     f)   Up to USD500,000.00 for discount of D/P, D/A export bills to Korona
          Haushaltswaren GmbH & Co. KG in Germany up to 120 days.


     1)   e) + f) shall not exceed USD1,500,000.00.

     2)   Aggregate tenor of T/R and Usance L/C shall not exceed 120 days.

     3)   The discount of DIP, D/A and export invoice is restricted to the
          pre-approved drawees only. Advance will be made against submission of
          invoice copy and/or copy of bill of lading and/or transport document.
          Upon maturity of the financing period, the relevant buyers shall remit
          payment directly to the Lender in favor of the Borrower.

     4.   PURPOSE

          Trade activities requirements.


          >    Corporate Guarantee duly executed by Bonso Electronics
               International Inc_ limit of USD2,000,000.00.

          >    Assignment of ECIC policy on approved drawees with the Lender as
               loss payee for discount of ECIC-covered export buyers' invoices.


                                                                       Page 3of6
                                              Our Ref. CCIB/SC/mch/03-L0013BONS0


          The Borrower and Corporate Guarantor undertake to

     a)   deliver to the Lender certified true copies of the Borrower's and the
          Corporate Guarantor's annual audited financial statements within 180
          days after each fiscal year and such other information (financial or
          otherwise) as the Lender may request;

     b)   notify the Lender promptly of the occurrence of any event which might
          affect the Borrower's and the Corporate Guarantor's ability to perform
          their obligations hereunder or any change in the shareholding or
          control of the Borrower or of the Corporate Guarantor.


          HKD5,000.00 (Say, Hong Kong Dollars Five Thousand), payable upon
          acceptance of this Facility Letter.


          UC Opening Commission and In Lieu of Exchange Commission

          First US$50,000 or its equivalent                    1/4%
          Balance                                              1/16%

          Handling Fee for Export Invoice Discount

          1/16% flat on the invoice value or minimum charge at HKD300.00.

          All other banking charges shall be subject to the Lender's standard
          scale of charge and the rules of The Hong Kong Association of Banks.

     9.   INTEREST

          Trade Finance                  : The Lender's Cost of Funds + 2% p.a.

          Export invoice discount with
           ECIC covered bills            : The Lender's Cost of Funds + 1% p.a.

          The interest shall be calculated on the basis of actual number of days
          elapsed on a year of 360 or 365 days, whichever is applicable to the
          currency concerned in accordance with general banking practice.
          Interest on Trade Finance is to be payable in arrears on the last day
          of each interest period.

          If any sum is not paid when due, that sum shall bear an overdue
          interest at a rate of 3% per annum above the rate as specified above
          from the due date to the date when actual payment is made in full.


                                                                     Page 4 of 6
                                              Our Ref. CCIB/SC/mch/03-L0013BONS0


          The Facilities will be available until further notice subject to the
          availability of funds and the receipt of the followings that are in
          form and substance satisfactory to the Lender

     a)   the attached copy of the Facility Letter duly signed by authorized
          signatories of the Borrower and the Corporate Guarantor signifying the
          acceptance of the agreement to the terms and conditions contained
          herein, with respective supporting board resolutions;

     b)   the Corporate Guarantee duly executed by. the Corporate Guarantor,
          with supporting board resolutions; (received)

     c)   certified copies of constitutional documents of the Borrower and the
          Corporate Guarantor, including Certificate of Incorporation, Business
          Registration Certificate, and Memorandum & Articles of Association;

     d)   the General Commercial Agreement duly completed and executed by the
          Borrower, with supporting board resolutions; (received)

     e)   account opening documentation duly completed by the Borrower;

     f)   certified copies of Identification/Passport of the authorized
          signatories of the Borrower and the Corporate Guarantor; (received)

     g)   such other documentation as may be reasonably requested by the Lender
          to validate the above Facilities.

     11.  WARRANTY

          The Borrower and the Corporate Guarantor hereby warrant that there has
          been no material adverse change in their respective financial
          conditions which would reduce their ability to meet their obligations

     12.  LAW AND VENUE

          This Facility Letter and the execution thereof shall be governed by
          and construed in accordance with the laws of Hong Kong Special
          Administrative Region ("Hong Kong"). The Borrower and the Corporate
          Guarantor hereby irrevocably agree to submit to the non-exclusive
          jurisdiction of the Hong Kong courts.


          The Borrower agrees to accept the appointment of the Corporate
          Guarantor to be its service agent to receive and acknowledge on behalf
          of the Corporate Guarantor of any writ, summons judgment or other
          notice of legal process in Hong Kong issued in relation to this
          Facility Letter. If for any reason that the Borrower (or its
          successor) no longer services as service agent of the Corporate
          Guarantor for this purpose, they shall promptly request the Corporate
          guarantor to appoint a successor service agent and notify the Lender
          thereof. The Corporate Guarantor agrees that any such legal process


                                                                     Page 5 of 6
                                               Our Ref.CCIB/SC/mch/03-L0013BONS0

          shall be sufficiently served on the Corporate Guarantor if delivered
          to the Borrower for service at its address for the time being in Hong
          Kong whether or not such agent gives notice thereof to the Corporate

As a general banking practice and notwithstanding any terms and conditions
specified above, the Lender reserves its overriding right to cancel, modify or
demand immediate repayment of all outstanding balances whether due or owing,
actual or contingent under the Facilities without prior notice. The usage and
the continual availability of the Facilities are subject to the Lender's
standard documentation, periodic review and the usual requirement that there
will be no material adverse change in the financial position of the Borrower and
the Corporate Guarantor.

Please indicate your acceptance of the above terms and conditions by signing and
returning to us the duplicate of this Facility Letter.

This Facility Letter, once accepted and upon our confirmation that all
Conditions Precedent have been satisfied, shall supersede our Facility Letter
dated 30'" January 2002 (Our ref. CORP/RC/mch/02-L0006Bonso) and the outstanding
thereunder shall be transferred as outstanding hereunder.

We are pleased to be of service to your company and look forward to a mutually
beneficial relationship.

Yours faithfully,
For and on behalf of
Natexis Banques Populaires
Hong Kong Branch

/s/  Tony AU                                /s/  Frederick FAN
-----------------------------               ----------------------------------
     Tony AU                                      Frederick FAN
     Deputy General Manager                       Head of Operations

We confirm our acceptance on the terms and conditions stated in above and agree
to be bound thereby.

For and on behalf of

Date: FEB 20, 2003


                                                                     Page 6 of 6
                                              Our Ref. CCIB/SC/mch/03-L0013BONS0

We, as Corporate Guarantor, hereby confirm and consent to the terms and
conditions of the Facilities, and confirm that our obligations under the
Guarantee of 18 MAR, 2002 continue in full force and effect and expressly extend
to and guarantee the performance of the terms and conditions of the Facilities.

For and on behalf of
Bonso Electronics International Inc.

Date: fEB 20, 2003