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1、COMPENSATION TRADE CONTRACT Contract No.： _ Date of Signing： _ Place of Signing： _ The two Parties： Party A： _ Address： _ Tel：_Fax： _ E-mail： _ Party B： _ Address： _ Tel：_Fax： _ E-mail：_ WITNESSETH Whereas Party B has machines and equipment, which are now used in Party Bs manufacturing of _, and is
2、willing to sell to Party A the machines and equipment； and Whereas Party B agrees to buy the products, _, made by Party A using the machines and equipment Party B supplies, in compensation for the price of the machines and equipment, and Whereas Party A agrees to purchase from Party B the machines a
3、nd equipment, and Whereas Party A agrees to sell to Party B the products, _, in compensation of the price of Party Bs machines and equipment； Now therefore, in consideration of the premises and covenants described hereinafter, Party A and Party B agree a follows： ARTICLE 1 TRANSACTIONS A） Party B ag
4、rees to provide Party A with _ machines to be used in production, their auxiliary machinery, accessories and spare parts and a variety of measuring and testing instruments required in the process of production. The details of the models, names, specifications,quantity, prices, packing, delivery , et
5、c. thereof shall be specified in an additional equipment-import agreement to be concluded by and between both parties which shall serve as an component part hereof. B） The total value of the machines, auxiliary equipment, etc. supplied by part B shall be paid off by Party A with part of the manufact
6、ures made therewith and/or other goods, or with（designate name）products made in （Name of the plant）if both parties agree. The specific name（s）, quantity, price, delivery, etc. of the goods granted as the make-up payment shall be decided in an additional compensation goods-supply agreement made by th
7、e parties which shall serve as a component part hereof. The equipment-import agreement and compensation-goods-supply agreement aforesaid may be merged as one called sales agreement on compensation trade（See appendix）. ARTICLE 2 PAYMENT Both parties agree to open letters of credit in favor of each ot
8、her, i.e. Party A will open, at regular intervals, long term letters of credit in favor of Party B to pay by installments the total cost of the machines and auxiliary equipment provided by Party B； whereas Party B will open sight letters of credit in favor of Party A to pay the products to be delive
9、red by Party A. Party A shall pay for the total cost of the machines and auxiliary equipment with the money remitted by Party B as reimbursement for the products to be delivered by Party A. In case the sum to be paid by Party B fails to cover the value of the long-term letters of credit opened by Pa
10、rty A, the difference shall be made up by Party B by paying that much to Party A in advance, before the long-term letters of credit are due, to enable Party A to reimburse on time the long-term letters of credit it opens. The payment of the long-term letters of credit opened by Party A is based on P
11、arty Bs opening a sight letter of credit under the provisions and on its paying the advance required herein. Thus, Party B warrants, guarantees and covenants that it will open the letters of credit and pay the advance as provided herein. ARTICLE 3 REIMBURSEMENT Party A shall reimburse Party B for al
12、l the machines and auxiliary equipment supplied by Party B by delivering goods to Party B on a monthly basis and the reimbursement will last for_ year（s） and _months（s）. The reimbursement shall start approximately _month（s） after the first delivery of the machines and, in principle, the money to be
13、reimbursed per month shall be _percent of the total amount due for the machines. With a _month（s） notice to Party B, Party A may reimburse Party B in advance. Within the reimbursement period, Party B shall, under the provisions of the additional sales agreement aforesaid, open, sight, irrevocable, d
14、ivisible and assignable letters of credit, covering the full amount, in favor of Party A. ARTICLE 4 STANDARD MONEY AND PRICE STANDARD The standard money for this transaction is （Name of currency）. All the machinery, auxiliary equipment and measuring and testing instruments , etc. provided by Party B
15、 shall be valued with （Name of currency）, while the goods provided by Party A to Party B as reimbursement shall be valued with the basis price （Name of currency） of the same goods exported by Party A at the time when this agreement is entered into, and the total price （Name of currency） shall be changed into that of （Name o f currency） in accordance with the exchange rate then. ARTICLE 5 INTREREST Party A shall pay the interest on its long-term letters of credit and the interest
