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4. Loan Agreement and Promissory Notes dated December 23, 2015, privately arranged and duly
stamped, between Narkata and IIL the Agreement. Pursuant to the Agreement, IIL agrees to grant a loan to Narkata up to a maximum sum of Rp17,100,000,000, which shall be used to finance
working capital subject to the terms and conditions of this Agreement. The applicable interest rate is 12.0 per annum. The Agreement is valid from January 1, 2016, up to December 31, 2016, and
may be extended upon the mutual agreement of both parties. With respect to this Agreement, the parties agree to choose the Sidoarjo District Court Secretariat as a choice of forum for dispute
resolution. The parties are in the process of extending the Agreement. The parties remain subject to the Agreement and continue to perform their rights and obligations pursuant to this Agreement.
5. Loan Agreement and Promissory Notes dated December 23, 2015, privately arranged and duly
stamped, between Integriya and the Company the Agreement. Pursuant to the Agreement, the Company agrees to grant a loan to Integriya up to a maximum sum of Rp17,100,000,000, which
shall be used to finance working capital subject to the terms and conditions of this Agreement. The applicable interest rate is 12.0 per annum. The Agreement is valid from January 1, 2016, up to
December 31, 2016, and may be extended upon the mutual agreement of both parties. With respect to this Agreement, the parties agree to choose the Sidoarjo District Court Secretariat as a choice of
forum for dispute resolution. The parties are in the process of extending the Agreement. The parties remain subject to the Agreement and continue to perform their rights and obligations pursuant to
this Agreement.
13. Material Transactions and Agreements with Third Parties
In carrying out their business activities, the Group has prepared and entered into the following material agreements with third parties:
No. Subject
Description
1. Title of Agreement
Deed of Export Investment Credit Agreement No. 66 dated December 22, 2010, drawn up before Raden Ayu Poppy Darmawan, S.H., a Notary in Jakarta, which has been amended
several times and was last amended by the Deed of Ninth Amendment to the Export Investment Credit Agreement No. 20 dated December 7, 2015, drawn up before Julia
Seloadji, S.H., a Notary in Surabaya the Agreement.
The Parties -
Exim the Creditor; and
- The Company the Debtor
jointly referred to as the Parties.
Object of the Agreement
Credit Facilities extended to the Debtor in the form of:
a. Export Investment Credit Facility I the KIE I; b. Export Investment Credit Facility II the KIE II;
c. Export Investment Credit Facility III the KIE III; and d. Export Investment Credit Facility IV the KIE IV.
The funds shall be used for the following purposes: a. KIE I to finance acquisition of assets, including to repay the aflopendworking capital
credit facility from Bank BNI and the Long-Term Credit Facility from Bank BNI to refinance the assets of the Debtor’s subsidiaries.
b. To finance the procurement of machinery and equipment, to refinance the constructions of the warehouse, Kiln Dry Chamber, and the equipment under the
name of the Debtor and its Subsidiaries; c. KIE III to refinance the construction of the Building Component Unit and the
equipment under the Debtor’s name; and d. To finance the refinancing of investment credit used for the procurement of machinery
and other equipment. The Principal and
The principal and interest of the Credit Facilities granted by the Creditor to the Debtor are
124
No. Subject
Description
Interest of the Credit Facility
set out below: a. KIE I Facility totaling USD14,493,500.41, subject to an interest rate of 6.4 per
annum; b. KIE II Facility totaling USD5,000,000, subject to an interest rate of 6.4 per annum;
c. KIE III Facility totaling USD3,100,000, subject to an interest rate of 6.6 per annum; and
d. KIE IV Facility totaling Rp46,000,000,000, subject to an interest rate of 10.0 per annum;
Term and Extension The Credit Facilities granted by the Creditor to the Debtor are under the following terms:
a. KIE I and KIE II Facilities for a term of 4 years, commencing on December 22, 2010; b. KIE III Facility for a term of 4 years, commencing on October 18, 2011; and
c. KIE IV Facility for a term of 4 years, commencing on March 27, 2015.
As of the date of this Prospectus, the Debtor and Creditor are in the process of signing an extension of the Credit Facilities Agreement signed by and between the Company and
Exim.
Collateral The Credit Facilities granted by the Creditor to the Debtor are secured with the Group’s
assets as collateral as described below: a. Fiduciary lien on all of the Debtor’s trade receivables from third parties, with a
collateral value of Rp150,000,000,000.00; b. Fiduciary lien on all of the Debtor’s inventories in the form of raw materials, work in
process, supplies, and finished goods for furniture production, with a collateral value of Rp350,000,000,000.00;
c. Fiduciary lien on Narkata’s heavy equipment, with a collateral value of Rp16,575,000,000.00;
d. Plots of land owned by the Debtor under the following proofs of ownership: i
Right to Build Certificate the SHGB No. 67Desa Betro, with a total area of 9,475 m
2
; ii
SHGB No. 261Desa Betro, with a total area of 3,540 m
2
; iii SHGB No. 262Desa Betro, with a total area of 3,495 m
2
; iv
SHGB No. 288Desa Betro, with a total area of 57,463 m
2
; which are entirely located in the East Java Province, Sidoarjo Regency, Sedati
District, Betro Village, or locally known as Jalan Raya Betro No. 678; e. Plots of land owned by the Debtor under the following proofs of ownership:
i SHGB No. 806Desa Gemurung, with a total area of 63,053 m
2
; ii
SHGB No. 807Desa Gemurung, with a total area of 60,000 m
2
; both of which are entirely located in the East Java Province, Sidoarjo Regency,
Gedangan District, Gemurung Village, or locally known as Jalan Raya Betro No. 678; f. Fiduciary lien on all Belayan’s inventories in the form of timber stored or located in
Loa Buah, Samarinda, Mamahak Village, Kutai Barat Regency, East Kalimantan, with a collateral value of Rp150,000,000,000.00; and
g. Fiduciary lien on all Narkata’s inventories in the form of timber stored or located in Loa Duri Ulu Village, PO. Box 1182, RT01RW01, Loa Janan, Samarinda Seberang,
Samarinda, East Kalimantan, with a collateral value of Rp50,000,000,000. Assignment
NA Covenants and
Encumbrances For as long as the Debtor has payment obligations to the Creditor, then, the Debtor is
prohibited from conducting the following without prior written consent from the Creditor: 1. Conducting a merger or acquisition, except if required under government policy.
2. Conducting sales or transfers of or relinquishing rights over the Debtor’s assets, except if carried out in the normal course of business or if required under government
policy. 3. Obtaining new debts resulting in the Debtor being indebted directly or indirectly,
except if carried out in the normal course of trade transactions. 4. Expanding or restricting the Debtor’s business;
5. Using the Credit Facilities set out in the Agreement other than for the purpose of Credit Facilities set out in Article 5 of this Agreement.
6. Filing a petition andor commissioning other parties to file a petition for bankruptcy or suspension of debt payment obligation before the court of law.
125
No. Subject
Description
7. Selling or transferring in any way whatsoever or releasing a portion or all of the Debtor’s assets, except if carried out in the Debtor’s normal course of business.
8. Entering into transactions with any party, not exclusively limited to the Debtor’s affiliated companies, in a manner inconsistent with common trade practices.
9. Lending money to any party whatsoever, including but not limited to its affiliated companies, except if carried out in the Debtor’s normal course of business.
10. Transferring a portion or all the Debtor’s rights andor liabilities over credit facilities to other parties.
11. Conducting a business consolidation, making capital investments or acquiring shares of other companies;
12. Amending the Debtor’s Articles of Association or changing the Debtor’s status; 13. Distributing dividends or profit shares in any form whatsoever in any amount
whatsoever to its shareholders, except if carried out in order to increase the Debtor’s capital structure.
14. Changing or allowing its capital structure to be changed. 15. Changing the composition of the Debtor’s shareholders
16. Changing the compositions of management, for example the Board of Commissioners or the Board of Directors.
17. Acting as a guarantor or surety in any form or under any name whatsoever andor guaranteeing or pledging the Debtor’s assets as collateral to other parties.
18. Entering into any commitment that may cause any impediment to the Debtor’s ability to meet its obligations to the Creditor.
Unilateral Termination NA
Governing Laws This agreement is subject to and construed with the prevailing laws in the Republic of
Indonesia. Dispute Settlement
South Jakarta District Court in Jakarta. 2.
Title of Agreement Deed of Export Investment Credit Agreement No. 64 dated December 22, 2010, drawn up
before Raden Ayu Poppy Darmawan, S.H., a Notary in Jakarta, which has been amended several times and was last amended by the Deed of Eight Amendment to the Export
Working Capital Credit Agreement No. 19 dated December 7, 2015, drawn up before Julia Seloadji, S.H., a Notary in Surabaya.
The Parties -
Exim the Creditor; and
- The Company the Debtor
jointly referred to as the Parties.
Object of the Agreement
Credit Facilities are extended to the Debtor in the form of:
a. Export Working Capital Credit Facility I the KMKE I; b. Export Working Capital Credit Facility II the KMKE II;
c. Export Working Capital Credit Facility III the KMKE III; d. Export Working Capital Credit Facility IV the KMKE IV;
e. Export Working Capital Credit Facility V the KMKE V; and f. Export Working Capital Credit Facility VI the KMKE VI;
The funds shall be used for the following purposes: a. KMKE I Facility to finance the Debtor’s working capital;
b. KMKE II Facility to finance the Debtor’s working capital; c. KMKE III Facility to finance contractspurchase ordersother documents that are
acceptable, which demonstrates requests for procurement of furniture products; d. KMKE IV Facility to finance the Debtor’s and its business group’s Narkata and
Belayan working capital for sales to third parties non-affiliate; e. KMKE V Facility to finance the working capital for the furniture industry;
f. KMKE VI Facility to compensate the unrealized timber sales revenue from the Debtor’s and or its business group’s Belayan and Narkata buyers.
The Principal and Interest of the Credit
Facility The principal and interest of the Credit Facilities granted by the Creditor to the Debtor are
set out below: a. KMKE I Facility up to a principal amount of USD15,000,000.00, subject to an interest
rate of 6.1 per annum; b. KMKE II Facility up to a principal amount of USD5,000,000.00, subject to an interest
126
No. Subject
Description
rate of 10.0 per annum; c. KMKE III Facility up to a principal amount of Rp70,000,000,000.00, subject to an
interest rate of 6.1 per annum; d. KMKE IV Facility up to a principal amount of Rp80,000,000,000.00, subject to an
interest rate of 10.0 per annum; e. KMKE V Facility up to a principal amount of Rp54,000,000,000.00, subject to an
interest rate of 10.0 per annum; f. KMKE VI Facility up to a principal amount of Rp100,000,000,000.00, subject to an
interest rate of 10.0 per annum; Term and Extension
The Credit Facilities are granted by the Creditor to the Debtor under the following terms: a. The KMKE Facility I has been extended for a period of 12 months, commencing on
December 22, 2015, up to December 22, 2016, and may be extended in the term and procedures agreed by the Creditor and Debtor;
b. The KMKE Facility II has been extended for a period of 12 months, commencing on December 22, 2015, up to December 22, 2016, and may be extended in the term and
procedures agreed by the Creditor and Debtor; c. The KMKE Facility III has been extended for a period of 12 months, commencing on
December 22, 2015, up to December 22, 2016, and may be extended in the term and procedures agreed by the Creditor and Debtor;
d. The KMKE Facility IV has been extended for a period of 12 months, commencing on December 22, 2015, up to December 22, 2016, and may be extended in the term and
procedures agreed by the Creditor and Debtor; e. The KMKE Facility V has been extended for a period of 12 months up to May 20,
2018, and may be extended in the term and procedures agreed by the Creditor and Debtor;
f. The KMKE Facility VI has been extended for a period of 12 months, commencing on December 7, 2015, up to December 7, 2016, and may be extended in the term and
procedures agreed by the Creditor and Debtor; Collateral
The Credit Facilities granted by the Creditor to the Debtor are secured with the Group’s assets as collateral as described below:
a. Fiduciary lien on all of the Debtor’s trade receivables from third parties, with a collateral value of Rp150,000,000,000.00;
b. Fiduciary lien on all of the Debtor’s inventories in the form of raw materials, work in process, supplies, and finished goods for furniture production, with a collateral value
of Rp350,000,000,000.00; c. Fiduciary lien on Narkata’s heavy equipment, with a collateral value of
Rp16,575,000,000.00 sixteen billion five hundred seventy five million Rupiah; d. Plots of land owned by the Debtor under the following proofs of ownership:
i Right to Build Certificate the SHGB No. 67Desa Betro, with a total area of
9,475 m
2
; ii
SHGB No. 261Desa Betro, with a total area of 3,540 m
2
; iii SHGB No. 262Desa Betro, with a total area of 3,495 m
2
; iv
SHGB No. 288Desa Betro, with a total area of 57,463 m
2
; which are entirely located in the East Java Province, Sidoarjo Regency, Sedati
District, Betro Village, or locally known as Jalan Raya Betro No. 678; e. Plots of land owned by the Debtor under the following proofs of ownership:
i SHGB No. 806Desa Gemurung, with a total area of 63,053 m
2
; ii
SHGB No. 807Desa Gemurung, with a total area of 60,000 m
2
; both of which are entirely located in the East Java Province, Sidoarjo Regency,
Gedangan District, Gemurung Village, or locally known as Jalan Raya Betro No. 678; f. Fiduciary lien on all Belayan’s inventories in the form of timber stored or located in
Loa Buah, Samarinda, Mamahak Village, Kutai Barat Regency, East Kalimantan, with a collateral value of Rp150,000,000,000.00 one hundred fifty billion Rupiah; and
g. Fiduciary lien on all Narkata’s inventories in the form of timber stored or located in Loa Duri Ulu Village, PO. Box 1182, RT01RW01, Loa Janan, Samarinda Seberang,
Samarinda, East Kalimantan, with a collateral value of Rp50,000,000,000.00 fifty billion Rupiah.
Assignment NA
127
No. Subject
Description
Covenants and Encumbrances
For as long as the Debtor has payment obligations to the Creditor, then, the Debtor is prohibited from conducting the following without prior written consent from the Creditor:
1. Conducting a merger or acquisition, except if required under government policy.
2. Conducting sales or transfers of or relinquishing rights over the Debtor’s assets,
except if carried out in the normal course of business or if required under government policy.
3. Obtaining new debts resulting in the Debtor being indebted directly or indirectly,
except if carried out in the normal course of trade transactions. 4.
Expanding or restricting the Debtor’s business; 5.
Using the Credit Facilities set out in the Agreement other than for the purpose of Credit Facilities set out in Article 5 of this Agreement.
6. Filing a petition andor commissioning other parties to file a petition for bankruptcy or
suspension of debt payment obligation before the court of law. 7.
Selling or transferring in any way whatsoever or releasing a portion or all of the Debtor’s assets, except if carried out in the Debtor’s normal course of business.
8. Entering into transactions with any party, not exclusively limited to the Debtor’s
affiliated companies, in a manner inconsistent with common trade practices. 9.
Lending money to any party whatsoever, including but not limited to its affiliated companies, except if carried out in the Debtor’s normal course of business.
10. Transferring a portion or all the Debtor’s rights andor liabilities over credit facilities to other parties.
11. Conducting a business consolidation, making capital investments or acquiring shares of other companies;
12. Amending the Debtor’s Articles of Association or changing the Debtor’s status; 13. Distributing dividends or profit shares in any form whatsoever in any amount
whatsoever to its shareholders, except if carried out in order to increase the Debtor’s capital structure.
14. Changing or allowing its capital structure to be changed. 15. Changing the composition of the Debtor’s shareholders andor the Debtor’s
management Board of Commissioners andor Directors. 16. Acting as a guarantor or surety in any form or under any name whatsoever andor
guaranteeing or pledging the Debtor’s assets as collateral to other parties. 17. Entering into any commitment that may cause any impediment to the Debtor’s ability
to meet its obligations to the Creditor. Unilateral Termination
NA Governing Laws
This agreement is subject to and construed with the prevailing laws in the Republic of Indonesia.
Dispute Settlement South Jakarta District Court in Jakarta.
The Parties 1. BNI Bank; and
2. Interkraft Debtor.
