In accordance with the principles of mutual benefit and by friendly consultations, Party A and Party B hereby
agree as follows in relation to the lease of the factory buildings and ancillary production equipment, etc. from
Party A to Party B.
a) Party A hereby agrees to lease to Party B the factory buildings, which are located at No.8, Wuzhouxilu,
Yangzhou Economic Development Area.
b) The total lease area is changed to 6.910.5M 2 (calculated according to the actual usable area).
c ÷ Party A hereby warrants that the factory buildings and the ancillary production equipment are all legally
owned by Party A without any legal defects.
d) The factory buildings and the ancillary equipment to be leased to Party B must be used for legal purpose.
02) Lease Term
a) Time of delivery: Party A should deliver the Premises to Party B by October 1 2007.
b) Duration of the lease: The proposed term of this lease is two years, from October 1 2007 to September 30
c) One month prior to the expiration of the lease term (before September 1 2007), if Party B intends to renew
the lease, the rent will be adjusted according to the consumer price index as promulgated by the government.
d) If Party B does not give the renewal request in writing within the above specified period, then, Party A has the
right to terminate the lease. But Party B has the preferred right to lease for a provisional period of 5 years.
e) This contract is the extended contract for the contract that was signed by both Parties as of October 1, 2005.
Once this contract comes into effect, the previous contract becomes out of validity.
03) Purpose of the Lease
The factory buildings and ancillary production equipment, etc. to be leased to Party B should be mainly used for
manufacturing purpose. Provided that the safety and quality of Party A’s buildings would not be affected, Party B
has the right to use reasonably the factory buildings (within th