AGREEMENT
Exhibit
10.7
(English
Translation)
Zhuanghe Port Industrial Zone
Management Committee (hereafter Party A) and Dalian Heavy Mining Equipment
Manufacturing Co. Ltd (hereafter Party B ), under the principle of Equal and
Reciprocal Benefit, have undergone friendly negotiation regarding Party B ‘s
plan to build a plant in the jurisdiction of Party A and hereby enter the
following agreement for both party to perform :
Article
One Scope
and Scale of Business
1.
Party B
agrees to invest in the jurisdiction of Party A. The project requires a land in
the area of 132 acres
(actual area depends on the result of official survey). The price for the use of
land shall follow the State policy. Party A shall provide full
redemption to Party B in a form of “levy first , redeem later”. The redemption
is intended to fund the Infrastructure of company. The term for use of land is
50 years.
2. The
business scope of company is researching, developing, designing, manufacturing,
assembling and testing of metallurgy machinery and large sets of
equipment.
3. Amount
of Investment: the total investment of XXX 000 xxxxxxx xxxxx xx completed within
three years, 50 million of which shall be completed in 2010 for
constructing the main workshops, office building and partial purchase of
equipments; 30 million of which shall be completed in 2011 for equipments; 50
million of which shall be completed in 2012 for workshops, assembly sites and
equipments purchase
Article
Two Project
Schedule
Before the end of November 2009, Party B shall complete the environmental assessment, the construction permit application and the other necessary early procedures to start construction. Any delay to the issuance of construction permit caused by Party A shall give an extension to the project accordingly.
Article
Three Duties
of Party A
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1.
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Party
A shall locate the actual place where Party B is to
invest.
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2.
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Party
A shall send its employee to assist Party B to obtain permits, make
changes to the registration and acquire business licenses and so on as in
the other procedures.
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3.
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Upon
the receipt of payment for use of land, Party A shall assist Party B in
the processing of expropriation license, project application and other
necessary documents for constructing
project.
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4. Party
A guarantees Party B the preferential incentives regarding loan discount,
financing aid, tax and the others from the Liaoning Province Coastal Economy
Lane Focused Developing Area, Dalian City Government and Zhuanghe City
Government. If any preferential incentives announced later on by the State and
each level of governments, Party A guarantees Party B shall acquire the priority
of such.
5. Party
A shall actively recommend Party B to the middle to small sized credit guarantee
corporations within the jurisdiction of the Liaoning Province, Dalian City and
Zhuanghe City for financing guarantee.
6.
Any
corporate income tax and VAT of Party B levied to the local Revenue shall be
returned in full for three
years starting from 2009, and thereafter in 50% for another three years starting
from 2012, which is
intended for the development of company.
7.
Any
township property tax levied to the local Revenue within two years after 2009
shall be funded back to
Party B in full.
8. Any
income tax levied from the individual employee of Party B to the local Revenue
shall be returned in 50% for five years after 2009. In particular, any
individual employee who purchases a property of value exceed RMB 200 thousand
shall enjoy 100% of tax return.
9. Pursuant
to Party B’s project schedule, Party A shall provide basic facilities, including
paving roads outside the red line around the plant zone, water, sewage,
electricity and one time electrical capacity upgrade, communication (telephone,
broad band and cable TV). Party A shall also be responsible for resident
relocation and site preparation.
10. Any
issue regarding to the environmental protection, safe production permit and fire
department, as long as Party B satisfies the requirement of relevant authorities
in its proposal and construction, Party A is to provide assistance in the
processing of license application.
11.
Any
administrative charge assumed to Party B shall be paid by Party A for three
years after 2009.
12. Party
A shall return in full the Land Transfer Fee for XXX 00 thousand/acre to Party B
in one time payment within 3 months after the end of the public land
bidding/auctioning/listing.
Article
Four Duties
of Party B
1. Pursuant
to Party A’s requirement, Party B shall furnish all the necessary documents and
submit the payment for relevant license application.
2. Pursuant
to the business proposal and project schedule, Party B shall distribute the
investment fund in place and on time.
3. Party
B shall legally operate the business and pay the tax prescribed by the authority
of jurisdiction to which it locates.
4. Any
drainage and sewage shall meet the State environmental standard.
5. Any
safety measures and producing activities shall satisfy the State’s safe
production requirement.
6. If
the conditions for construction are met, Party B shall activate the project
before November of 2009 pursuant to the proposed construction schedule and then
start producing, otherwise, depending on the actual process, Party A shall
reduce or even cancel the promisedpreferential incentives.
7.
The land
is intended for industrial use. Party B shall not change its intended
use after obtaining the Land Use
License; otherwise, Party A shall be able to repossess the land
unconditionally.
8. Party
B agrees to start construction as scheduled. If the land is left for undeveloped
for more than two years without any construction ever on, Party A shall be able
to repossess the land unconditionally.
9. Party
B shall timely transmit the Land Transfer Fee in one time payment to the
designated account of Party A.
Article
Five Breach of
Contract
1. Either
Party A or Party B is committed to perform its duty. If either party
breaches contract, resulting in the damage to the other, the breaching party
shall be held liable for all the damage.
2. If
Party B does not transfer the Land Use Fee on time, Party B shall be able to
revoke Party B’s right to the use of land.
3. If
Party B fails to obtain Land Use License on time due to the cause of Party A,
Party A shall return the Land Use Fee to Party B.
4. If
Party B fails to comply with the investment schedule as agreed by this contract,
Party A shall have right to reduce or even cancel the promised preferential
incentives depending on the actual processing.
5. Unless
advanced negotiation, neither Party A nor B shall disclose any information
pertaining to this contract. Any disclosure by one party resulting in the damage
to the other, the disclosing party shall be liable for any damage
incurred.
Article
Six Disclaimer
For any
Force Majored such as Act of God, which results in the
impossibility/impracticability of performance to this contract, neither party
shall be held liable in law.
Article
Seven Resolution
of Dispute
Any
dispute arising between the parties shall be resolved through negotiation, if
failed, shall be submitted to the
joint supervising authority for settlement or resorted to the People’s
court.
Article
Eight Miscellaneous
1. Any
issue not exhausted shall be negotiated and reduced to a supplemental agreement
between and by the parties. The supplemental agreement shall have the
same effect as this contract.
2. If
any adjustment to the State macro policy occurs, the relevant provision in this
contract shall apply accordingly.
Article
Nine Effectiveness
This
contract has two original copies, each held by one party to this contract, and
shall take effect immediately after it is signed by both
parties.
Party A:
Zhuanghe Lingang Industrial Zone Managing Committee
Party B:
Dalian Heavy Mining Equipment Manufacture Co. Ltd
(Seal) (Seal)
Seal in Circle: Zhuanghe
Lingang Industrial Zone Managing Committee
Seal in Circle: Dalian Heavy
Mining Equipment Manufacture Co. Ltd
/s/ Xxx
Xxxxx
Sha /s/
Xxxxx Xxxx
Authorized
Agent: Sha, Zhi
Qiang Authorized
Agent: Xxxx,
Xxxxx
September 17, 2009
