Production Building Lease Contract
| Lessor: |
Dongguan
Diguang Electronics Science & Technology Co.,
Ltd.
|
| (Hereinafter referred to as Party A) |
Authorized
Representative: Ge Mingbo (assistant of president)
Address:
Chanshantou Hongmenshan Industry District, Dongguan
TEL:
▇▇▇▇-▇▇▇▇▇▇▇ FAX: ▇▇▇▇-▇▇▇▇▇▇▇ P.C.:523660
| Lessee: |
Dongguan
Branch, Shenzhen Diguang Electronics Co.
|
| (Hereinafter referred to as Party B) |
Authority
Representative: Song Hong (vice president)
Address: chanshantou
Hongmenshan Industry District, Dongguan
TEL:
▇▇▇▇-▇▇▇▇▇▇▇ FAX: ▇▇▇▇-▇▇▇▇▇▇▇ P.C.:523660
Pursuant
to the related regulations and laws, Party A and Party B have reached the
agreement through amicable consultation as follows:
Article
1: location, Area, Purpose and Use
1.1
Party
A will lease the production building (“Lease Material”) of Part A, which is
located at Dongguan Chanshantou Hongmenshan Industry District, to Party B for
use. It has confirmed by both sides that the area of Leas Material accounts
for
40,000 square meters.
1.2
The
Lease Material is performed as the production building for the fixed use of
Party B. The approval in writing will have to be made by Party A If Party B
intends to change this function, for which all the expenses to be required
and
paid in terms of formalities required in the governmental regulations will
be
born by Party B on his own.
1.3The
Lease Material is taken in the fixed form, which is under control of Party
B.
Article
2: Term of Lease
2.1
Term
of lease: 5 years, namely, from February 1st
2005 to
January 31st
2010
2.2
In
tow months prior to the expiration date of the lease, the request should be
put
forward for the approval of Party A. After the same approval, Party A and Party
B will execute a new lease contract for the relevant lease issues. At the same
lease condition, Party B will take a priority.
Article
3: Handover of Rental and Lease Material
3.1
The
lease term from February 1st
2005 to
April 31st 2005 is the period free of rent. The rent from May 1st 2005 to July
31st
2005
will be assumed by Shenzhen Diguang Electronics Co. Limited. Starting with
August 1st
2005,
the rent will be undertaken by Dongguan Branch, Shenzhen Diguang Electronics
Co.
Limited.
3.2
Within15 days from effective date of this lease contract, Party A will hand
over
to Party B the current Lease Material and Party B will agree to lease the same
Lease Material.
Article
4: Lease Expenses
4.1
Lease
Deposit
The
lease
deposit is 3 times as much as the rent for the first month, namely,
RMB1.14million.
4.2
rent
RMB950,000/M2
will be
taken as the rent per month in the 1st
and
2nd
years
including the maintenance fees, totaling up to RMB380,000/per month. In the
term
from the 3rd
to
5th
years
the rent will be based on RMB380,000/per month, which can be adjusted with
the
prevailing market price.
4.3
Power
Increase Capacity Fee and Electricity Fee
Party
A
will undertake to deal with the formalities of power increase capacity, however,
all the expenses to occur for the same formalities will be taken by Party B.
The
electricity fees to be used for all the production areas will be assumed by
Party B.
Article
5: Payment of Rent
5.1
Party
B will disburse RMB1.14million (deposit) to Party A in lump sum as of March
31st
2006. As
of the expiration of the lease term, Party will unconditionally return the
deposit to Party B within 15 days after all the due rent and expenses have
been
paid up to Party A and the Lease Material has been returned to Party A with
the
stipulated obligations in the contract completely fulfilled by Party
B.
5.2
Party
B will pay for the monthly rent to Party A on or as of the date of the
30th
as well
as remit the same rent to the following band account appointed by Party A or
the
payment will be made upon the other means that is approved by both parties
in
writing.
If
the
overdue payment is made on the rent, Party B will disburse the demurrage to
Party A, which comes to Late Days × 0.1% (of the total arrear rent).
5.3
Party
B will disburse the maintenance fee to Party A on or as of the date the
30th
every
month in accordance with Article 4.3 of the contract. If the overdue payment
is
made, Party B will disburse the demurrage to Party A, which comes to Late Days
×
0.1% (of the total arrear amount of maintenance fee).
5.4
After
execution of the contract, Party A will go through the related formalities
on
the power increase capacity, for which the expenses, but not limited to the
same
increase capacity, will be borne by Party B. Party B will pay for the same
expenses to Party A during the ongoing formalities that is handled by Party
A.
Article
6: lease Transfer
6.1
During the lease period, if Party A transfers all or part of the Lease Material,
Party A should ensure that Lessee can continue to fulfill the contract. At
the
same condition, Party B will take a priority.
Article
7: Special Facilities, Maintenance of Site
7.1
During the lease period, Party B will have the special right to use the
facilities attached for the Lease Material. Party B will take responsibility
for
the maintenance, upkeep and annual check for the special facilities of the
Lease
Material as well as ensure that the special facilities will work properly,
which
are returned to Party B with the Lease Material at the expiration of the
contract, for which Party A will have the right to make the inspection and
supervision.
7.2
Party
B will be responsible for the proper use and maintenance of the attachments
of
the Lease Material, and eliminate in time the various possible faults and
dangers so as to avoid all the possible hidden troubles.
7.3
In
the lease term, Party B will repair or recover the damages, which could happen
due to the mal-operation by Party B, the expenses will be taken by Party B.
Article
8: Safety of Fireproofing
8.1
In
the lease term, Party B must abide by the relevant regulations (Fireproofing
Rules of P.R.China) and make the active coordination with Party A for the good
fireproofing work, otherwise, all the responsibilities to be caused thereof
will
be taken by Party B.
8.2
Party
B will provide the fire extinguishers in the Lease Material pursuant to the
relevant regulations and it is forbidden to use the fire protection facilities
in the building for the other purposes.
8.3
Party
B will be all in charge of the safety of fireproofing in the Lease Material
pursuant to the related regulations from the fire protection department. Party
A
will have the right to check the fireproofing safety in the Lease Material
at
the reasonable time fixed by both sides, for which the prior notice in writing
should be issued to Party B, which is not allowed to be refused or delayed
without reason by Party B.
Article
9: liability of insurance
In
the
lease term, Party A will be in charge of the insurance purchase for the Lease
Material and Party B will be in charge of the insurance purchase for the
property and the others in the Lease Material including the liability insurance.
If both parties do not buy the insurances as above, the compensation and
liabilities to be caused will be separately taken by both parties.
Article
10: Management of Maintenance and Repair
10.1
At
the expiration of the lease term or the advance termination of the contract,
Party B will return the Lease Material to Party A with the building cleaned
and
the move completed as of the date of the expiration or by the date of the
advance termination. If the Lease Material is handed over by Party B without
the
litters’ clearance, then, Party B will assume the expenses that are used for
clearing the litters from Party A.
10.2
For
the use of the Lease Material, Party B must abide by the laws, regulations
that
are issued both from P.R.China or the local government as well as the relevant
rules that are stipulated on the maintenance and repair from Party A, otherwise,
Party B will assume the responsibility concerned. If Party B the other users
cannot make the normal operation around the buildings due to the mal-operation
against the above that is made by Party B, all the loss to occur will be
compensated for by Party B.
Article
11: Decoration
11.1
In
the lease term, if Party B intends to do the decoration and renovation, the
same
design plans will have to be provided to Party A for approval.
If
the
same plans could affect the public utilities and the other neighboring users,
Party A may oppose the same plan, for which Party B will make the modification.
The expenses for the same will be borne by Party B.
11.2
If
the plan could affect the main structure of the Lease Material, the same plan
cannot be carried out until the approval is given from Party A and the original
designing department in writing.
Article
12: Advance Termination of Contract
12.1
In
the lease term, if Party B owes Party A the rent or the maintenance fees for
more than three months, Party B will make the outstanding payment within five
days upon the written arrear notice issued by Party A. Party A will have the
right to stop Party B using the relevant facilities in the Lease Material,
for
which all the loss to be caused will be borne by Party A including, but not
limited to, the loss from Party B and re-lessee.
If
Party
B owes the rent or the maintenance fee for more than two months, Party A will
have the right to terminate the contract in advance and act in accordance with
Article 2. Party A may send fax or a letter to Party B to notify that the
contract automatically terminates. Party A will have the right to retain the
property of Party B in the Lease Material (including the property of re-lessee),
and after 5 days upon the written notice for the contract termination, Party
A
will make the application for the auction on the retained property to offset
all
the expenses occurred due to the lease, which should have been paid by Party
B.
12.2
Party B cannot terminate the contract in advance unless it is approved by Party
A. If Party B really intends to terminate the contract in advance, it should
be
done for Party B to notify Party A in writing three months in advance, and
the
end of the engagement cannot be fulfilled unless the following procedures are
finalized:
a)
Return
the Lease Material to Party A. b) Pay up the rent that happened in the lease
term and the other expenses occurred in the contract. c) Make the payment before
the termination of the contract or as of the date prior to the same termination
as the compensation that is equivalent to certain times as much as the rent
disbursed to Party A. Within 5 days after the above obligations are completed,
Party A will return the lease deposit (with no interest) of Party B to Party
B.
Article
13: Dismissal of Obligation
13.1
If
Party A cannot continue to fulfill the contract due to the modifications made
from the government in the laws and regulations in terms of the lease aspects,
the performance will be made pursuant to Article 2.
13.2
If
the contract cannot be fulfilled by any of the parties due to war, serious
natural disaster or Force Majeure, the party in Force Majeure should send an
email or fax to notify the other party immediately and within 30 days produce
the certificates to indicate that the contract or part of it cannot be fulfilled
or postponed, which should be issued from the notarization department in Force
Majeure area, if it is impossible to get it, the other authoritative certificate
should be offered. The party in Force Majeure is free of
obligation.
Article
14: Termination of Contract
Upon
the
advance termination of the contract or the expiration of the contract, if both
parties do not reach the renewing agreement, then, Party B should leave the
Lease Material prior to the date of the termination or expiration of the
contract and return it to Party A. Party B should pay the double rent to Party
A
if Party B does not leave or return the Lease Material beyond the fixed time.
But when notifying Party Party A will have the right to notify Party B in
writing that when the notice is not acceptable by Party B, Party A has the
right
to acquire the double rent and take back the Lease Material and forcibly to
evacuate the goods out of the lease Material without any responsibility for
cares.
Article
15: Tax and Expenses
According
to the relevant regulations and rules from the state and Dongguan, Guangdong
Province, Party A (Lessor) and Party B (lessee) will respectively take the
expenses such as the stamp tax, registration fee, notarization fee and the
others to be levied in connection with the contract. Party A will handle the
registration.
Article
16: Notice
All
the
notice and request, etc. from the contract and the documents from Party A to
Party B and vice versa should be given in writing. The letters and faxes from
Party A to Party B and vice versa will be deemed delivered once it is sent,
and
it is also deemed delivered that the registered mail is received as per the
contract address or the mail is deliver by a special person.
Article
17: Applicable Law
17.1
If
there is any dispute in the implementation of this contract, both parties will
make a solution through amicable consultation. In case the agreement cannot
be
reached, the dispute will be submitted for the arbitration. Both sides
unanimously agree that the arbitration will be judged at Shenzhen Branch, China
International Economy & Trade Arbitration Committee.
17.2
This
contract is governed and construed in the laws of the Peoples’ Republic of
China.
Article
18: Miscellaneous
18.1
For
the outstanding matters, the separate agreement can be executed after the
consultation by both parties.
18.2
There will be two copies of originals of this contract, one for each party.
Article
19: Effectiveness of Contract
This
contract will come into the execution with the signature and stamp.
Party
A
(stamp):
Authorized
representative (signature):
Party
B
(stamp):
Authorized
representative (signature):