Common use of JVC Clause in Contracts

JVC. Instead of provision of guarantee, the Providing Party may elect to provide financial assistance to the JVC on behalf of the Non-Providing Party through shareholder loans. In such case, the JVC shall pay the Providing Party interest as compensations on the total amount of the loans at an interest rate same as the interest rate on the bank loans of the same term, and bear all taxes and expenses in relation to the payment of the interest. In case the JVC is unable to obtain funds as described above, the Investing Parties shall provide the required funds to the JVC in proportion to their ownership percentage. If either Party fails to provide funds in accordance with the above provisions (referred to as “Non-Providing Party” in this Section), the other Party (referred to as “Providing Party” in this Section) shall have the right to elect a) to terminate this Contract and liquidate the JVC by giving written notice to the other Party, or b) to purchase the equity interests held by the Non-Providing Party in the JVC in accordance with the provisions of PRC Laws at a price based on valuation. The JVC shall, upon Investing Parties’ request at any time, pay the principal and accrued interest on the above funds provided by the Parties on a pro rata basis (e.g., the principal and interest paid by the JVC to the Investing Parties shall be in proportions to their perspective contribution to the funds).