Lease Contract
Lessor: Northwest
Refractory Material Factory
Lessee: Xi’an
Baorun Industry Development Co. Ltd.
Pursuant to the “PRC Economics Contract
Law” and other relevant regulations, the two parties execute this contract,
after negotiation and reaching consensus, in order to stipulate the rights and
obligations of the lessor and the lessee.
Article
I Name,
Quantity and Proposed Use of the Asset to be Leased
1. The
lessee shall lease from the lessor a piece of land, the four boundaries of which
are: the east side ends at the east wall of the Clay Workshop Rest Lounge; the
west side ends at the peripheral wall on the protective slope of the material
ground; the south side ends at the middle line of the street in front of the
Gangyu Workshop; and the north side ends on the border of the flood-discharge
ditch adjoining the Boiler Room. The land is to be used for the
proposed oil tank supporting facility.
2. The
lessor has 7 oil tanks for its own use, total capacity of which is 8,000 cubic
meters. They are hereby to be leased to the lessee for the
development of its oil product storage business.
Article
II The
Term of the Lease
The term of the lease is for a total of
6 years from July 1, 2008 to June 30, 2016. The lessee shall
undertake procedures for the renewal of the lease contract if the lessee needs
to extend the term for the use of the land. The lease renewal shall
be completed two month in advance from the expiration date of the
lease. Failure to execute the contract for renewal shall be
considered forfeiture of the extension of the term for the use of the
land.
Article
III Rent,
Payment and other Provisions
1, The
annual rent is RMB700,000, payable in four installments per year.
2, Payment
method: can be in the form of cash or of bank wire.
Article
IV The
Rights and Obligations of the Two Parties
1. Lessor
Has the obligation to ensure the
provision of electricity, water and gas necessary for the lessee’s operation
activities, development and construction project during the term of the
lease. In the meantime, the lessor has the right to monitor the
leased property to ensure the security and protection of the state
asset.
2. Lessee
Has the right to legally enjoy the use
right of the leased asset during the term of the lease, and has the obligation
to pay rent and usage fees for electricity, water and other utilities on time
and in full as per this contract; the lessee has the obligation to bear tall
consequences resulting from fire control and safety, production safety and other
environmental protection measures.
Article
5 Breach
of Contract
If one side of the lessor and the
lessee fails to perform its duties in accordance to the provisions of the
contract, thus causing loss to the other side, it shall pay the corresponding
penalty fee for the breach to the other side. If both sides are at
faulty, then each side, on the basis of actual circumstances, shall bear its
corresponding liability for the breach.
Article
6 Force
Majeure
In the event of the occurrence of Force
Majeure, causing either side of the two parties inability to
execute, either in full or in part, the terms of the contract, the
contract may be altered or dissolved through negotiation between the two
parties. In the event of lessor’s declaration of
bankruptcy or other material policy adjustments, the legal binding power of this
contract survives with regard to the new owner of the contemplated asset after
the bankruptcy of the lessor, in addition to the provision that the lessee has
preferential right with regard to the purchase of the leased asset.
Article
7 Other
Stipulated Matters
Regarding the matters not discussed in
the contract, the two parties shall make amendment through negotiation; the
amendment shall have the same legal effect as that of this
contract. In any case, the subsequent amendment shall prevail, if the
provisions of this contract conflict with those of the amendment.
This contract has two copies, with each
party keeping two copies.
Lessor: Northwest
Refractory Material Factory (Seal)
Agent:
(signature)
Lessee: Xi’an
Baorun Industry Development Co. Ltd. (Seal)
Agent:
(signature)
Address of execution: Xiaobeibao,
Yaozhou District
Date of
execution: April 30,
2008