Lease Agreement (English Translation)
Exhibit
10.16
(English
Translation)
In
accordance with Contract
Law of the PRC
and
other relevant laws and regulations, the lessor Fuyong Yingfeng Machinery &
Equipment Factory (“Party A”) and the lessee Shenzhen Ritar Power Co., Ltd.
(“Party B”) have reached the following agreement (the “Agreement”) through
friendly negotiation.
Article
1 Lease Property
Party
A
agrees to lease Party B the property (the “Lease Property”) located at the
second floor of block A1, 3rd
Area (A)
of Xinhexinxing, Fuyong Town, Bao’an District, Shenzhen with an area of 2,100
square meters.
Article
2 Usage
The
Lease
Property shall be used as factory, and the maximum weight that each square
meter
of land of the Lease Property can support is 550 kilograms. Unless agreed upon
by both parties, Party B shall not alter the structure and usage of this Lease
Property, or it shall bear whole liability.
Article
3 Lease Term
The
lease
term shall be one year, commencing on 15th
March
2007 and expiring on 14th
March
2008.
Article
4 Rental and Payment Mode
| 1) |
The
rent shall be RMB 25,200 Yuan per month (RMB 12 Yuan per square meter
per
month). After every 2 years commencing from the coming into effect
of this
Agreement, the rent shall increase 5% on the basis of the preceding
month’s rent.
|
| 2) |
The
rent and other fees shall be paid monthly, and Party B shall pay
the
monthly rent to Party A before the 5th
day of each month, and Party A shall present relevant receipts to
Party B
when it receives the rent (Party B shall be responsible for relevant
taxes). In case Party B fails to pay the monthly rent timely, it
shall pay
an overdue penalty calculated as 5‰ of the unpaid overdue fees per day.
|
Article
5 Deposit
| 1) |
Party
B shall pay the safety deposit (the “Deposit”) RMB 50,000 to Party A on
the date of the coming into effect of this Agreement. After Party
B enters
into the Lease Property, it shall pay the rent of the first month
to Party
A, and the Deposit will be returned to Party B after this Agreement
expires and all the fees have been paid
off.
|
| 2) |
The
Deposit shall not be used to set off the rent, management fee, utilities
or other relevant fees.
|
Article
6 Date of Transfer and Improvements
| 1) |
Party
A shall deliver the Lease Property to Party B by 15th
March, 2007 for improvements, and the rents shall be collected from
15th
April, 2007. The plan of improvements shall be delivered to Party
A in
writing and approved by Party A .
|
| 2) |
Party
B shall pay the fees for electricity during the period of
improvements.
|
| 3) |
Party
A shall be entitled to supervise Party B’s construction and cure any
activity which may be deemed to be breach of the improvements
plan.
|
1
Article
7 Rights and Obligations of Party A
| 1) |
Party
A shall provide the original facilities in relation to the use of
water
and electricity to Party B. In case Party B needs additional facilities
related to the use of water and electricity, Party A shall choose
qualified products and install them, and Party B shall bear the relevant
expenses.
|
| 2) |
In
case Party B delays to pay the rent, management fee or fees for water
and
electricity to Party A for more than one month, this Agreement shall
be
terminated and Party A is entitled to refuse to return the Deposit
to
Party B.
|
| 3) |
Party
A shall provide the access to the original elevator (load
capability:2000KG) to Party B or more parties, and Party B shall
comply
with relevant national rules in relation to the use of elevator.
The
maintenance and annual test fee shall be born by Party A, and the
charge
for electricity of such elevator shall be born by Party
B.
|
Article
8 Rights and Obligations of Party B
| 1) |
Party
B shall use the Lease Property subject to relevant laws, regulations
and
rules and actively support and assist Party A to have the Lease Property
examined and supervised by relevant authorities. Party B shall be
fully
responsible for the safety of the company’s personnel, property and
materials.
|
| 2) |
As
of the execution of this Agreement or immediately following the
commencement of the operation of Party B on the Lease Property, Party
B
shall deliver its business license and other relevant certificates
to
Party A for record. Party B shall bear whole liabilities which result
from
Party A’ s unlawful acts and also the economic loss of party A (if
any).
|
| 3) |
Party
B shall comply with the rules issued by Party A, including, but not
limited to Car Management Rules, Guest Management Rules
etc.
|
| 4) |
Party
B shall not alter the structure of the Lease Property. In case of
any
special situation, Party B shall negotiate with Party A and obtain
the
approval of Party A to alter the structure under the supervision
of
testing personnel from Party A without affecting the main infrastructure
of the Lease Property.
|
| 5) |
No
pets or other animals are allowed within the working and living
area.
|
| 6) |
Party
will be responsible for the maintenance of this Lease Property during
the
term of this Agreement.
|
| 7) |
In
the event that Party B intends to place outdoor advertisement, it
shall
obtain the prior written consent of Party A and relevant approval
of
relevant authority and comply with relevant laws and regulations.
Party B
shall be responsible for the safety of placing such advertisement
and the
management of such advertisement.
|
Article
9 Fire Control and Manufacture
| 1) |
Party
B shall comply with relevant laws and regulations in respect of the
fire
control and manufacture and make good arrangements to secure the
safety.
|
| 2) |
In
the event that Party B intends to make alterations or improvements
of the
Lease Property, it shall deliver the alteration or improvements plan
in
writing to Party A for review and obtain the written approval of
Party A.
Party B shall go through relevant procedures with the fire control
authority and obtain relevant
approvals.
|
2
|
3)
|
Party
B shall adopt necessary measures to protect the fire control facilities
(such as fireplug, fire extinguisher, emergency light etc.) in
the Lease
Property.
|
| 4) |
During
the lease term, Party B shall ensure that the evacuation path and
safe
exit are unblocked. Party B shall not take up the firebreak or block
the
evacuation path.
|
| 5) |
Party
A shall be entitled to examine, supervise the fire control and manufacture
of Party B and request Party B cure the defects. Party A is entitled
to
terminate this Agreement if Party B refuses to do so.
|
| 6) |
Any
liability or loss incurred from the fire control or manufacture of
Party B
shall be born by Party B, and any loss incurred from such matter
to Party
A or any third party also shall be born by Party
B.
|
Article
10 Labor Dispute
| 1) |
During
the lease term, Party B shall be responsible for the employee salaries
and
purchase social insurance and responsible for work-related injury,
medical
treatment of its employees subject to the Labor Law and any other
relevant
laws. If Party B fails to fulfill its obligations in this Article
10 after
Party A gives written notice, Party A shall be entitled to terminate
this
Agreement.
|
| 2) |
Any
liability incurred from the aforesaid matter shall be born by Party
B, and
if any loss incurred from the aforesaid matter to Party A, Party
A shall
be entitled to claim for damages.
|
Article
11 Other Fees of Party B
| 1) |
The
charge for electricity of each month shall be calculated on the basis
of
actual used electricity and in accordance with the charging standard
adopted by the Agricultural and Electrical
Company.
|
| 2) |
The
telephone fees shall be paid directly to the relevant authority by
Party
B.
|
| 3) |
The
water fees shall be calculated in accordance with the fee schedule
adopted
by the Water Company.
|
| 4) |
All
the fees in respect of the debt, credit, governmental management,
Business
License, taxes, property lease etc.
|
Article
12 Sublease
Without
prior consent of Party A, Party B shall not sublease part or whole of the Lease
Property to any third party. In case Party A agrees to the sublease, the rent
of
the sublease shall be decided by Party A and Party A has the right to the part
of sublease rent which exceeds the rent for Party B.
Article
13 Termination and Extension of the Agreement
When
the
lease term expires, Party B shall guarantee the intactness of the Lease Property
and all its facilities and go through the following procedures:
| 1) |
settle
all the fees (including rental, charge for water and electricity
and other
payable fees);
|
| 2) |
deliver
the keys, the Lease Property and its facilities subject to relevant
provisions of this Agreement to Party A, and compensate for any damages
(if any);
|
| 3) |
transfer
the extended premises, water and electricity facilities to Party
A without
charge, transfer the improvements to Party A according to Party A’s
requirement, recover or repair the premises if necessary and pay
relevant
expenses.
|
| 4) |
Party
A shall return the Deposit to Party B, and Party B shall vacate the
Lease
Property within 3 days. In case Party B fails to vacate the Lease
Property
within 3 days, the title of the property located in the Lease Property
shall be deemed as being abandoned by Party B, and Party A shall
be
entitled to dispose of such property and claim for double rent for
the
overdue period from Party A.
|
3
| 5) |
If
Party B needs to continue the use of the Lease Property after the
Contract
expires, it shall submit a written notice 3 months prior to the expiration
of the lease term to Party A and Party B shall have the right of
first
refusal.
|
Article
14 Termination of the Agreement due to Party B’s Fault
In
case
Party B terminates this Agreement unilaterally, it shall pay compensation to
Party A in an amount equal to two month’s rent and Party A shall be entitled to
retain the Deposit. If any loss to Party A is incurred from the termination,
Party A shall be entitled to possess certain property of Party B as collaterals
in accordance with the extent of the loss, and if no agreement can be reached
within 15 days, Party A shall be entitled to dispose of the aforesaid
collaterals to set off the loss of Party A and retain the right for further
claims. It shall be deemed as termination of this Agreement by Party B if any
of
the following condition is satisfied:
| 1) |
Party
B subleases the Lease Property without Party A’s
consent;
|
| 2) |
Party
B alters the structure and usage of the Lease Property
unilaterally;
|
| 3) |
Party
B produces counterfeit and inferior products and engages in other
unlawful
businesses;
|
| 4) |
Party
B fails to comply with the Labor Law and Fire Control Rules and fails
to
cure after receiving relevant notice;
|
| 5) |
Party
B damages the Lease Property on purpose;
|
| 6) |
Party
B delays to pay the rental for at least one
month;
|
Article
15 Automatic Termination of the Agreement
During
the lease term, this Agreement shall be terminated and each of the parties
shall
be free from liability in case that any of the following conditions is
satisfied:
1)
The
Agreement cannot be performed due to force majeure or unexpected
accidents;
2)
Government decides to confiscate the Lease Property;
3)
Any
other conditions subject to relevant laws.
Article
16 Performance of this Agreement
During
the lease term, any party who fails to perform any obligation stipulated in
this
Agreement shall bear corresponding liability subject to relevant provisions
under this Agreement. In case any lease agreement is needed for completing
relevant procedures with the relevant authority, this Agreement shall prevail
for the purpose of performing such lease agreement.
Article
17 Dispute Settlement
Any
dispute arising out of this Agreement shall be negotiated by both parties,
and
if no agreement can be reached, either party may bring relevant lawsuit to
the
court within the jurisdiction.
Article
18 Side Agreement
Any
issue
not covered by this Agreement shall be otherwise agreed by both parties in
a
side agreement. The side agreement shall prevail in terms of any discrepancy
between the side agreement and the Agreement.
Article
19 Effect of this Agreement
There
are
two originals of this Agreement. Each party shall hold one original. The two
originals shall have the same legal effect.
4
Party
A:
Fuyong
Yingfeng Machinery & Equipment Factory
(Corporate
Seal)
Party
B:
Shenzhen
Ritar Power Co., Ltd.
(Corporate
Seal)
Date:
15th March, 2007
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