Exhibit 10.18
LEASE AGREEMENT
This Agreement is entered into between Jen Xxxx Xxxxx and Xxx Xxxx Xxx("Party
A") and Kid Castle Educational Corporation ("Party B").
For the purpose of renting the subject building, both parties agree as follows:
1. SUBJECT BUILDING
Owner: Jen Xxxx Xxxxx and Xxx Xxxx Xxx
Location: Xx. 000, Xxxx-Xx Xx., Xxxxxxx 0, Xxxx Xxxxxx, Xxxxxx Xxxxxx
Lease Scope: principal building, accessory building and common area,
the total area is 3,300 sq m
Building No.: 00037, 00038, 00039, 00040, 00041, 00109 and 00110
Title scope: complete ownership with mortgage
Lease scope: the whole marked building 3 parking lots
(No. 7~9, exclusive for 24-hour tenant) Public facilities
such as existing roads, lanes and stairs (in addition to
the marked building)
376 pings for temporary lease (in addition to the marked
building) (a "ping" is an area approximately equal to 36
square feet)
3. LEASE PERIOD
1. Lease period: 10 years (November 1, 2004 to October 31, 2014)
2. Temporary lease period: 6 months (December 01, 2004 to May 31, 2005)
4. RENT AND METHOD OF PAYMENT
1) NT$300 per ping, total 1000 pings (including public facilities such
as stairs).
The rent of NT$300,000 (including 10% income tax) shall be paid
monthly on or before the 6th day of every month. Party B shall draw
6 mature checks every six months from the execution date without
delay or refusal for any reason.
Rent for the first two months from the execution date will be
exempted. The rent will be collected from January 1, 2005.
2) Rent for temporary lease is NT$300 per ping, total 376 pings
(including
public facilities such as stairs).
The rent of NT$112,800 (including 10% income tax) shall be paid
monthly on or before the 6th day of every month. Party B shall draw
6 mature checks every six months from the execution date without
delay or refusal for any reason.
3) Party B shall issue withholding certificate for filing tax report.
5. INCREASE OF RENT
The rent will be increased from beginning of the 4th year of this
Agreement period, which will be calculated according to the annual
increase rate of consumer price index (house rent index) announced by the
Directorate-General of Budget, Accounting and Statistics of the Executive
Yuan.
6. DEPOSIT
The deposit is NT$712,800 (including deposit of NT$112,800 for temporary
lease). Party B shall pay the deposit upon execution of this Agreement.
Party A shall return the above deposit to Party B without interest at the
end of lease period when Party B returns the subject building pursuant to
this Agreement.
9. LIMITATION ON USE OF THE SUBJECT BUILDING
Party B is using the subject building for storage and distribution of
books. Party B shall not allow others to use part of or the whole subject
building by sub-leasing, lending or any other methods. Party B shall not
transfer the rights of tenancy to others.
11. LIABILITY OF TENANT
Party B shall maintain the subject building with the care of a good faith
custodian.
13. END OF LEASE PERIOD
If Party A terminates this Agreement before the end of lease period, it
shall inform Party B with a 6-month written notice. If Party A terminates
this Agreement before the end of the 3rd year of the lease period, it
shall pay Party B NT$600,000 as compensation; if Party A terminates this
Agreement during the 4th and 5th year of the lease period, it shall pay
Party B NT$300,000 as compensation.
If Party B terminates this Agreement before the end of lease period, it
shall inform Party A with a 6-month written notice. If Party B terminates
this Agreement before end of the 3rd year of the lease period, it shall
pay Party A NT$600,000 as compensation; if Party B terminates this
Agreement during the 4th and 5th year of the lease period, it shall pay
Party A NT$300,000 as compensation.
Party B may terminate the temporary lease before the end of lease period,
and, upon termination by Party B, Party A shall return any rent that has
been paid but is not yet due without interest and the NT$112,800 deposit.
19. TERMINATION OF THIS AGREEMENT BY PARTY A
Party A may terminate this Agreement if Party B:
1) delays the payment amounting to three-months' rent, and does not
make the payment after Party A has requested such payment.
2) violates Article 9
3) violates Article 10(2)
20. TERMINATION OF THIS AGREEMENT BY PARTY B
Party B may terminate this Agreement if:
1) Party A fails to repair damages of the subject building when Party A
is liable for such repair, and still does not repair after a
reasonable period from the date Party B requested such repair.
2) Party A is unable to reach an agreement with Party B to reduce rent
as provided for in Article 12(1)
3) The subject building is defective which may threaten the safety or
health of Party B or its housemates.
4) If the governmental authority finds the subject building has been
used for illegal purpose and tears down part of the building, which
causes Party B unable to use the building, Party B may terminate
this Agreement, and Party A shall return undue rent and deposit, and
pay Party B one-month's rent as a compensation for moving.
This Agreement also contains provisions with respect to obligations of each
Party, such as payment of taxes and other fees, repairing and returning of the
subject building, transferring ownership of the subject building, and other
miscellaneous matters.
