Lease Agreement - LE0701
Lease
Agreement - LE0701
This
Lease Agreement (hereinafter referred to as "the Lease") is entered into as
of
December
31, 2007 in
the
city of Shanghai, by and between SHANGHAI KAI HONG TECHNOLOGY CO., LTD.
(hereinafter referred to as "Party A") with its registered office at ▇▇.▇ ▇▇▇▇
▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ Export Processing Zone, Shanghai, P.R.China and
SHANGHAI DING HONG ELECTRONIC CO., LTD. (hereinafter referred to as "Party
B")
with its registered office at ▇▇.▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇.▇.▇▇▇▇▇.
Party
A
and Party B are collectively referred to as the “Parties” and individually as a
“Party”.
WHEREAS,
The
Parties agree on the lease of the 5th floor (set forth in Exhibit 1, hereinafter
referred to as “Area 1”) The Parties also agree on the lease of the 4th floor of
the Accommodation Building (set forth in Exhibit 2, hereinafter referred to
as
"Area 2"). Party B represents that it is the lawful owner of the Accommodation
Building (as defined below).
1.
Definitions
Unless
otherwise defined in this Lease, the terms used herein shall have the following
meanings:
1.1
"Accommodation Building" shall mean the six-story dormitory building located
on
the ▇▇▇ ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇.
1.2
"Area
1" shall mean the 5th floor of the Accommodation Building (Exhibit 1, 5th Floor
Layout for the Accommodation Building).
1.3
"Area
2" shall mean the 4th floor of the Accommodation Building (Exhibit 2, 4th Floor
Layout for the Accommodation Building)
1.4
"Effective Date" shall mean the date on which this Lease will take effect after
the legal representatives or authorized representatives of the Parties affix
their signatures and corporate seals on the Lease.
1.5
"Lease
Term" shall mean the period of time on which Party A is entitled to use the
Lease Area and Party B is entitled to receive rent from Party A in accordance
with the terms and conditions of the Lease.
1.6
"Lease Area" shall mean Area 1 and Area 2
1.7
“Actual Lease Area” shall mean Area 1 and the future possible lease area of Area
2.
2. The
Construction and Facilities of the Accommodation Building
2.1 Party
B
shall deliver the Accommodation Building in compliance with the requirement
of
Exhibit 3 (Exhibit 3 - Decoration and Facilities Requirement of Accommodation
Building). Party B agrees that decoration and facilities shall be at its own
expenses.
2.2 Party
B
promises that the construction and building quality of the Accommodation
Building shall be in compliance with all the relevant quality standards. Party
B
shall obtain from all necessary government authority checked and accepted
inspection certificates. Party B guarantees the quality of the facilities of
the
Accommodation Building and the quality of the equipments in each room. Party
B
further guarantees the quality of the materials used in making the facilities
in
the Accommodation Building shall meet Party A's and relevant inspection’s
requirements.
3.
Lease Term
3.1For
Area 1, the Parties agree that the Lease Term is _5
(five)_year(s)
commencing on
April
27, 2007.
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3.2 The Parties agree that the Lease Term for Area 1 and Area 2 shall be automatically renewed for successive 5 year lease unless Party A gives written notice of termination not less than 30 days before the expiration of any Lease Term. During the Lease Term or any renewal period, Party B shall not terminate this Contract without Party A's written approval. For the renewal period, the items relating to the rental set forth in Article 6 of the Lease shall be adjusted on the basis of the market prices at the time of renewal and after consultation between the Parties.
3.3
If
during any term of this Lease, Party B receives from a third party a bona fide,
legally binding offer to lease the portion of Area 1 and/or Area 2 not already
leased by Party A, Party B shall notify Party A of this fact. The notice shall
specify all the terms of the bona fide third party offer. Party A shall then
have thirty (30) days to lease that portion of the Area 1 and/or Area 2
specified in the third party’s bona fide offer for the rent and related details
set forth in Articles4 and 5. Party B shall not lease Area 1 and Area 2 to
any
third party until the thirty (30) days has expired without Party A exercising
its right of first refusal. Any other terms not specified in this Lease
regarding Area 1 and Area 2, both Parties shall negotiate and sign a
supplemental agreement for these unspecified terms. Such signed supplemental
agreement shall constitute a aprt of the entire Lease and shall have the same
effectiveness as the entire Lease.
3.4
As
for the future possible lease area in Area 2, Party A has provided the necessary
size of the lease area in Area 2 (the “Area 2 future lease”), terms for the Area
2 future lease shall be separately negotiated by the Parties and stated in
a
signed supplemental lease agreement to this Lease. Such signed supplemental
lease agreement shall then constitute a part of the entire Lease and shall
have
the same effectiveness as the entire Lease.
4.
Gross Area of the Rent Area
4.1
There
are 18
dorm
rooms with area of 824
square
meters and a TV room of 32
square
meters in Area 1. The gross area of Area 1 is 856
square
meters.
4.2
There
are 20
dorm
rooms with area of 1,150
square
meters and a TV room of 32
square
meters in Area 2. The gross area of Area 2 is 1,182
square
meters.
5.
Rental
5.1
The
Parties agree that the monthly rent for Area 1 shall be RMB29.80 per square
meter and for a total of RMB25,508.80
per
month.
5.2
The
Parties agree that the monthly rent for Area 2 shall be RMB 29.80 per square
meter and for a total of RMB35,223.60
per
month.
6.
Deposit
For
the
lease of Actual Lease Area, Party A shall pay Party B a deposit amount of
RMB25,508.80
within
10 days of the effective date of the Lease.
7.
Method of Payment
For
the
Actual Lease Area, Party A shall pay the Rental in RMB to the RMB bank account
as designated by Party B before the first day of every month.
8.
Termination of the Lease
If
either
Party terminates the Lease prior to the expiration of the Rent Term without
the
consent from the other Party, the Party that terminates the Lease shall pay
damages to the other Party to compensate for such Party’s actual loss. The
amount of damages shall include, but not be limited to, the reasonable profits,
out-of-pocket costs, legal service fees, Court fees, arbitration fees,
accounting fees and removal or relocation fees.
9.
Insurance and Repair Costs
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9.1
During the term of the Lease, Party B shall purchase and maintain insurance
coverage to cover any and all casualty damage to the Accommodation Building,
and
shall be responsible for repairing all structural damages to the building that
are not the result of improper use by Party A. Party A shall be responsible
for
all repair costs arising from improper Building usage by Party A. If Party
B
cannot obtain building insurance, Party A will need to obtain insurance for
the
Actual Lease Area, and Party B will reimburse Party A for all costs of such
insurance coverage.
9.2
Party
B shall be entitled to inspect the Accommodation Building at reasonable
intervals and upon reasonable notice to Party A. Party A shall provide
assistance to allow such inspections.
10.
Liability for Breach of the Lease
10.1
If
Party A violates Article 5 of the Lease for failing to pay the Rental, then
Party A shall pay a penalty at the rate of 0.021% of the Rental for each day
of
delay.
10.2
If
Party B breaches any of its warranties set forth in this Lease, Party B shall
compensate Party A for all of Party A’s losses and damages including
consequential, special, punitive and incidental damages.
10.3
Party A shall not:
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(1)
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sub-lease
the rent area or exchange the use of the rent area with any third
party
without Party B's prior written
consent.
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(2)
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alter
the structure of the rent area or damage the Building without Party
B's
prior written consent.
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| (3) |
change
the lease purpose stipulated by the competent authorities without
Party
B's consent.
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11.
Warranties
11.1
Party B hereby warrants that if the Accommodation Building is sold to any third
party during the Rent Term or the period of renewal, such third party shall
be
required to fulfill all obligations of Party B under the Lease. If said third
party fails to carry out the Lease, Party B shall compensate Party A for all
of
Party A’s losses and damages including consequential, special, punitive and
incidental damages.
11.2
In
case Party B mortgages the Accommodation Building to the third party, any loss
suffered by Party A shall be paid by Party B.
12.
Force Majeure
12.1.
The
definition of Force Majeure
Force
Majeure shall mean any event which arises after the Effective Date that is
beyond the control of the Parties, and is unforeseen, unavoidable and
insurmountable, and which prevents total or partial performance by either Party.
Such events shall include earthquakes, typhoons, flood, fire, war, acts of
government or public agencies, strikes and ay other event which cannot be
foreseen, prevented and controlled, including events which are recognized as
Force Majeure in general international commercial practice.
12.2
Consequences of Force Majeure
a.
If an
event of Force Majeure occurs, the contractual obligation of a Party affected
by
such an event shall be suspended during the period of delay and the time for
performing such obligation shall be extended, without penalty, for a period
equal to such suspension.
b.
The
Party claiming Force Majeure shall give prompt notice to the other Party in
writing and shall furnish, within fifteen (15) days thereafter, sufficient
proof
of the occurrence and expected duration of such Force Majeure. The Party
claiming Force Majeure shall also use all reasonable efforts to mitigate or
eliminate the effects of the Force Majeure.
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c.
If an
event of Force Majeure occurs, the Parties shall immediately consult with each
other in order to find an equitable solution and shall use all reasonable
efforts to minimize the consequences of such Force Majeure.
13.
Effective Date of the Lease
The
Lease
shall become effective after the legal representatives or authorized
representatives of both Parties affix their signatures and company seals on
the
Lease.
14.
Language of the Lease
The
Lease
is made and executed in Chinese and English, both versions having equal
validity.
15.
Settlement of Dispute
15.1
Friendly consultations
a.
In the
event of any dispute, difference, controversy or claim arising out of or related
to the Lease, including, but not limited to, any breach, termination or validity
of the Lease, (the "Dispute") then upon one Party giving the other Party notice
in writing of the Dispute (the "Notice of Dispute"), the Parties shall attempt
to resolve such Dispute through friendly consultation.
b.
If the
Dispute has not been resolved through friendly consultations with thirty (30)
days from the Notice of Dispute, the Dispute shall be resolved by arbitration
in
accordance with Article 15.2 of this Lease. Such arbitration may be initiated
by
either Party.
15.2
Arbitration
The
arbitration shall be conducted by Shanghai Arbitration Commission in Shanghai,
China in accordance with its procedure and rules. The arbitration award shall
be
final and binding on the Parties. The costs of arbitration shall be borne by
the
losing Party except as may be otherwise determined by the arbitration
tribunal.
15.3
Continuance of performance
Except
for the matter in Dispute, the Parties shall continue to perform their
respective obligations under the Lease during any friendly consultations or
any
arbitration pursuant to this Article 15.
15.4
Separability
The
provisions of this Article 15 shall be separable from the other terms of the
Lease. Neither the terminated nor the invalidity of the Lease shall affect
the
validity of the provisions of this Article 15.
16.
Applicable Law
The
validity, interpretation and implementation of the Lease and the settlement
of
Disputes shall be governed by relevant PRC laws and regulations that are
officially promulgated and publicly available.
17.
Miscellaneous
17.1
Any
amendment to this Lease shall be in writing and duly signed by both Parties.
Such Amendment shall constitute a part of the entire Lease.
17.2
Both
Parties acknowledge that they are aware of their respective rights, obligations
and liabilities and will perform their obligations under the Lease in accordance
with the provisions of the Lease. If one Party violates the Lease, the other
Party shall be entitled to claim damages in accordance with the
Lease.
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17.3
Any
notice or written communication requited or permitted by this Lease shall be
made in writing in Chinese and English and sent by courier service. The date
of
receipt of a notice or communication shall be deemed to be seven (7) days after
the letter is deposited with the courier service provided the deposit is
evidenced by a confirmation receipt. All notice and communications shall be
sent
to the appropriate address set forth below, until the same is changed by notice
given in writing to the other Party.
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To:
Party A
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Address: ▇▇.▇
▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ Export Processing Zone, Shanghai,
P.R.China
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Attn.:
Shanghai Kai Hong Technology Co.,
Ltd.
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To:
Party B
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Address:
▇▇.▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇.▇.▇▇▇▇▇
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Attn.:
Shanghai Ding Hong
Electronic Co., Ltd.
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17.4
This
Lease comprises the entire understanding between the Parties with respect to
its
subject matters and supersedes any previous or contemporaneous communications,
representations, or agreements, whether oral or written. For purposes of
construction, this Lease will be deemed to have been drafted by both Parties.
No
modification of this Lease will be binding on either Party unless in writing
and
signed by an authorized representative of each Party.
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Party
A:
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Shanghai
Kai Hong Technology Co., Ltd.
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Party
B:
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Shanghai Ding
Hong Electronic Co., Ltd.
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Representative:
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Representative:
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Date:
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Date:
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