Exhibit 10.32
 
Plant and Office Building Lease Agreement
 
[Unofficial Translation]
 
Lessor (hereinafter referred to as Party A) : Tianjin Shengkai Industrial
Technology Development Co., Ltd.
 
Address: Wanggang Road 27, South Development Zone, Tianjin City
 
Lessee (hereinafter referred to as Party B) : Tianjin Longhan Jingmi Industrial
Co., Ltd.
 
Address: Road 4, #28, Saida Moju Yuan C4-C5, Xiqing Economic Development Zone,
Tianjin City
 
This agreement is made by and between the parties on the matter of lease of the
plant and office building pursuant to the Contract Law of the People’s Republic
of China, Law of the People’s Republic of China on Urban Real Estate
Administration and other relevant laws under the principles of equality, mutual-
benefit, and valuable consideration.
 
1.  
The Status of the Plant

A.  
Party A is willing to lease to Party B the plant and office building located in
Wanggang Road 27, South Development Zone, Tianjin City (hereinafter referred to
as the “Premise”), the total area of the Premise is 6133.75 square meters,
(please see the Certificate of Land Property Ownership #112030902147 for more
detailed information).

B.  
The purpose of use of the Premise is only for production. Party B shall not
change the purpose of use of the Premise without Party A’s consent.

 
2.  
Lease Term

A.  
The term of the lease agreement is five years, commencing from August 15, 2011
to October 15, 2016.

B.  
Under the circumstance that the government makes a plan of the area where the
Premise is located, Party B shall remove out of the Premise unconditionally at
the cost of Party B per the request of Party A.  Under the circumstance that
there is no such government plan, Party B has the preemptive right to renew this
lease agreement for 5 five years once the lease expired.

 
3.  
Availability of the Premise
Party A shall make the Premise available to Party B for the purpose of use
within 10 days from the effective date of this lease agreement, and Party B
shall sign all the lease documents, and Party B agrees to lease the Premise and
facilities as its current status.  Please see the attachment for the facilities.

 
4.  
Rental and Deposit

A.  
The rental fees is 900,000RMB per year (nine hundred thousand RMB), among which
800,000 RMB (eight hundred thousand RMB) shall be wired to the account
designated by Party A by the way of bank transfer, 100,000 RMB (one hundred
thousand RMB) shall

 
 
 

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be wired to the account designated by Party A by the way of cash wire.  The
payment shall be made once half a year.  The rental fee is 75,000 RMB per month
(seventy-five thousand RMB), and Party A is responsible for the tax which is
required according to the regulation.

B.  
Party B shall pay Party A 50,000 RMB as deposit when this lease agreement is
entered into.  If the deposit is not delivered within 10 days after the lease
agreement is made, the agreement will be terminated automatically, and Party B
shall compensate Party A in the amount of the deposit.  Party A shall return the
deposit without the interests to Party B when the lease expired, under the
conditions that no breach of the Agreement by Party B, no destroy of the
facility on the Premise and Party B has made all the rental fee, tax and all
other expenses derived from the lease agreement.

C.  
Delivery of the rental fee: Party B can use the Premise since the effective date
of this agreement, commencing from October 15, 2011.  The rental fee shall be
made once half a year.

D.  
Within 10 days after the Agreement is made, Party B shall make the payment of
400,000 RMB (four hundred thousand RMB) as first payment, which is considered as
part of the rental fee of the six months period from October 15, 2011 to April
15, 2012.  The rest of the payment which is 50,000 RMB (fifty thousand RMB)
shall be paid by cash when the second payment is made, which is when the rental
fee of the second six-month period is made.  In the case that Party B does not
make the first payment within the 10 days after the agreement is made, the
agreement will be terminated automatically, and Party B shall compensate Party A
for the losses.  Party A shall issue the invoice to Party B when it receives the
cash payment from Party B.

E.  
During the term of the lease, from 2012, Party B shall pay the rental fee for
the six-month period from July to December to Party A before March 1 and pay the
rental fee for the six-month period from January to June to Party A before
September 1.
There are three pieces specific equipment and one elevator in the plant which
needs the examination by the authorized entity once two years.  Party B is
responsible for the safety of using the equipment, and Party A is responsible
for the examination fee.
Party A shall submit the decoration and repair plan to Party B when the
agreement is entered, and Party B shall be responsible for the expenses of using
the facilities on the Premise.

F.  
With respect to the rental fee, tax and deposit (excluded the cash payment) set
forth in the provision, Party B shall make the payment to the below bank account
designated by Party A by the way of bank transfer:
Name:  Tianjin Shengkai Industrial Technology Development Co., Ltd.
Bank:   Pufa Bank Tianjin Branch
Account number: 7701054740007087

 
5.  
Other Expenses

A.  
During the term of the lease, Party B shall be responsible for the fee of supply
of water, electricity, gas, telephone and communication.  Party B shall make the
full payment once a month, and shall be responsible for penalty fee and all the
consequences if it fails to make on time payment.  The method of the payment is
that Party A will make the

 
 
 

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payment for Party B, and then Party B shall make the same payment to Party A
within the 3 days after Party A makes the payment for Party B.

B.  
Power capacity expansion fee:  the power capacity provided by Party A is 500KVA,
and the power capacity could be expanded if more is required.  Party A shall be
responsible for handling the process of expanding the power capacity, and Party
B shall be responsible for the fee for the power capacity expansion.  Party A
shall start the process of expanding the power capacity when this agreement is
effective, and Party B shall pay Party A any fee derived from the process.

C.  
With respect to the fees set forth in this provision, if Party B fails to make
such payment 30 days later than the payment is due, Party A has the right to
cancel this agreement and request Party B compensate Party A for any losses
(including direct loss and indirect loss), and Party A has the right to maintain
the deposit.

 
6.  
Party A’s warrants during the term of the lease:

A.  
Party A guarantees that it leases the Premise pursuant to the regulations, and
requirements of national government and local government;

B.  
Party A has an exclusive ownership of the Premise leased to Party B.  Party A
will be responsible for cleaning the issues if anyone claims the ownership of
the Premise.  And Party A shall be responsible for the loss of Party B resulted
from such issue.

 
7.  
Party B’s warrants during the term of the lease:

A.  
Party B shall use the premise and the facilities properly without changing the
Premise, expanding the Premise or making attachment to it without the consent of
Party A.  Under the circumstances that Party B needs to repair the Premise or
expand the facilities, it shall not commence doing that until getting the
consent form Party A and the approval from the relevant government authority
after Party A submits the application to the government authority.  Party B
shall be responsible for all the fees.

D.  
Party B shall pay the rental fee according to the lease agreement.  If Party B
fails to make the payment on time, besides the rental fee, it shall also pay to
Party A the penalty equal to 0.5% of the monthly rental fees for each day
delay.  In the case that Party B fails to make the payment beyond 60 days
behind, Party A has the right to cancel this agreement and request Party B
compensate Party A for any losses (including direct loss and indirect loss), and
Party A has the right to maintain the deposit and rental fees.

 
8.  
Repair responsibility of the premise:

A.  
Party B shall be responsible to repair the Premise and the facilities during the
term of the lease;

B.  
Party B is not responsible for any destroy of the Premise or the facilities due
to the force majeure;

C.  
Party B has the responsibility to use and maintain the Premise and facilities
properly, and Party B is also responsible to eliminate the fault and danger that
might happen on the Premise to avoid any potential trouble.  Party B shall be
responsible for compensating the loss due to Party B’s untimely repair which
results in the destroying incident of the Premise, loss of the properties or
personal injury.

 
 
 

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D.  
Party B shall give the assistance when Party A is conducting the regular
examination and repair of the Premise.

 
9.  
Transfer of the Lease, Amend the Agreement and Return of the Premise

A.  
During the term of the lease, Party B has the right to decorate the Premise, and
such decoration has to be made lawfully.

B.  
During the term of the lease, any transfer of the lease wholly or partially to
the third party shall be made with the consent of Party A, and a separate
contract shall be entered into.  In the case that it is transferred without
Party A’s consent, Party A has the right to cancel this agreement and request
Party B compensate Party A for any losses (including direct loss and indirect
loss), and Party A has the right to maintain the deposit and the rental fees.

C.  
During the term of the lease, two parties shall consult with each other when
they want to amend or terminate the agreement.  The party who wants to terminate
the agreement shall compensate the other party for the loss unless it is exempt
pursuant to the laws.

D.  
Party B shall clean the Premise, remove out of the Premise  and return the
Premise to Party A before the term of the lease is about to expire or when the
agreement is terminated.  Party B shall be responsible for the cleaning fees
occurred to Party A in the case that Party B does not do the cleaning when it
returns the Premise to Party A.

E.  
Party B shall obey the laws, regulations and adhere to the policies regarding
property management of the Premise made by Party A, and Party B shall be
responsible for the consequence if it violates.  Party B shall be responsible
for the losses if it affects the others nearby the Premise due to its violations
of the laws, regulations and the policies.

 
10.  
Provision of Decoration

A.  
During the term of the lease, if Party B wants to decorate or change the
Premise, it has to submit the decoration plan to Party A in advance to get Party
A’s consent, and submit to the government authority for approval if any is
required.  Party A can raise a disagreement to the decoration plan if it would
affect others on the commonly-shared facilities, and Party B shall make changes
accordingly.  Party B shall be responsible for the changing and decoration fee.

B.  
Under the circumstances that the decoration changing plan might affect the main
structure of the Premise, such plan cannot be carried out until it is approved
in writing by Party A and the entity who designed the Premise.

 
11.  
Advertisement

A.  
No advertisement board can be set up on the Premise by Party B unless it is done
with the written consent of Party A and all the relevant government approval
procedures have been gone through.

B.  
No advertisement board can be set up around the Premise by Party B unless it is
done with the written consent of Party A and pursuant to the government
regulations.

 
12.  
Fire Safety

 
 
 

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A.  
During the term of the lease, Party B shall adhere to the laws and regulations
of fire safety strictly, and play an active assisting role in the fire safety
matters; otherwise, Party B shall bear all the relevant loss.

B.  
Party B shall have fire extinguishers according to the relevant regulations on
the Premise, and it is not allowed to use the fire safety facility on the
Premise for other purpose.

C.  
It is required to have the approval of the department in charge when some level
one work involving fire is conducted on the Premise temporarily (such as welding
work).

D.  
Party B shall be responsible for the fire safety on the Premise according to the
regulations of the fire department.  Party A has the right to examine the fire
safety of the Premise at the reasonable time which agreed by the two parties,
Party B cannot object or delay to agree such suggestion unless it is with
acceptable reasons.

 
13.  
Fees
Party B shall bear the stamp duty tax and registration fees derived from this
agreement.

 
14.  
Applicable Laws and Dispute Resolutions
 
The agreement shall be governed and interpreted under the laws of the People’s
Republic of China. Any dispute arising out of or relating to this agreement
shall be settled by the parties hereto through friendly consultation.  If any
dispute is not settled through friendly consultation by the parties, such
dispute shall be submitted to the people’s court which has the jurisdiction over
such dispute.

 
15.  
Miscellaneous

A.  
This agreement terminates automatically in the case that the ownership of the
Premise is recovered by the government by the way of demolition or any other
way.  Party B shall return the Premise timely and all the demolition
compensation belongs to Party A.

B.  
With respect to the matters which are not covered in the agreement, the parties
can enter into supplement agreement upon consultation.

C.  
The agreement shall be effective when it is signed and sealed by the parties,
and only after Party A receives the deposit made by Party B.

D.  
This agreement is made in two original copies, and each party shall hold one
original copy.

 

 
[
 
Party A (sealed) : Tianjin Shengkai Industrial Technology Development Co., Ltd.
 
Legal Representative: Wang Chen
 
Authorized Representative: Guo Wei
 

 
 
 

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Party B : Tianjin Longhan Jingmi Industrial Co., Ltd.
 
Legal Representative: Longquan Li
 
Authorized Representative: Longquan Li
 
Date of signature: August 3, 2011