[This Document has been Translated from Chinese to English]

 

Supplemental Agreement to the Project Financing Agreement

 

This Supplemental Agreement (the “Agreement”) is made and entered into by and
among the following parties on January 26, 2012.

 

(1)     Tianjin Cube Xindao Equity Investment Fund Partnership (LLP), Tianjin
Cube Xinde Equity Investment Fund Partnership (LLP), Tianjin Cube Xinren Equity
Investment Fund Partnership (LLP) and Tianjin Cube Xinyi Equity Investment Fund
Partnership (LLP) (hereinafter referred to as “Cube” collectively), which are
limited partnerships duly incorporated and legally existing under the laws of
the People’s Republic of China (“PRC” or “China”).

 

(2)     Tsining Housing Development Co., Ltd. (the “Borrower” or “Tsining”),
which is a limited liability company duly incorporated and legally existing
under the laws of China, with its address at No. 9, Baqiao South Road, Baqiao
District, Xi’an City.

 

(3)     Clever Advance Limited (the “Pledgor” or “Hong Kong Clever”), which is a
limited liability company duly incorporated and legally existing under the laws
of Hong Kong.

 

Whereas:

 

I.With respect to the financing matters of Xi’an Baqiao A and Baqiao B Project
(the “Financing”), each party has already jointly or respectively executed the
Project Financing Agreement, the Financial Advisor Agreement, the Transaction
Arrangement Agreement for the Xi’an Baqiao A and Baqiao B Project Financing, the
Financial Regulatory Agreement and the supplementary agreements to the
above-mentioned agreements (the “Financing Transaction Documents” collectively).

 

II.After the execution of the Financing Transaction Documents, Cube disbursed
the entrustment loan totaling RMB 200,000,000 (the “Entrustment Loan”) to
Tsining via China Construction Bank Shaanxi Branch (the “Bank”). The Bank and
the Borrower signed the Entrustment Loan Agreement (Jian Shan Ying Wei Dai No.
(2011) 001－004).

 

III.Tsining has not obtained the land use rights to Baqiao A and Baqiao B
Project on time due to the fact that the government did not have available land
quotas. After consultation between them, both Cube and Tsining intend to clarify
and supplement to the specific usage terms of the Entrustment Loan.

 

IV.The Entrustment Loan will expire on January 27, 2012, and the Tsining applies
for a six-month renewal.

 

Accordingly, each party reaches the Supplemental Agreement as follows:

 

Article 1: The Use of the Entrusted Loan

 

1.1According to the Transaction Arrangement Agreement for the Xi’an Baqiao A and
Baqiao B Project Financing, Cube agreed that Tsining may purchase the equity
interest of Shanxi Bihu Real Estate Development Co., Ltd using RMB 30,000,000 of
the Entrusted Loan. Considering that Tsining has not purchased such equity
interest, Tsining agrees to transfer back the RMB 30,000,000 mentioned above to
the joint account held by Cube and Tsining no later than February 29, 2012, and
use it in accordance with this Agreement, unless Cube otherwise agrees.

 

1.2Provided that Tsining satisfies the terms and conditions of this Agreement,
Cube agrees to use already disbursed Entrusted Loan for the Borrower’s
“Xinqingfang” real estate project (“Xinqingfang Project”) which is located at
No. 66 Huzhu Road, Xi’an in the following ways:

 

(1)No more than RMB 150,000,000 of the Entrustment Loan shall be used in buying
the state-owned land use right of Xinqingfang Project (“Project Land”).
Specifically, no more than RMB 100,000,000 can be used to pay the trade margins
in order to participate in the listing and auction of the Project Land, and upon
receiving the confirmation letter, no more than RMB 50,000,000 can be used to
pay the land assignment cost. However, Tsining promises to pay the excess using
its own funds if the land assignment cost exceeds the amount mentioned above.

 

 

 

 

 

(2)Tsining could use the remaining balance of the Entrustment Loan to fund the
Xinqingfang Project or pay other upfront costs.

 

1.3Concerning the usage of the money stipulated in Clause 1.2 (1) and (2), Cube
and Tsining agree to put them in a jointly managed account that is monitored by
the two parties before paying the money to any payee. The seals of the jointly
managed account will be kept by the representatives appointed respectively by
the two parties. If it is necessary to pay to someone from this account, the two
seals controlled by Cube and Tsining must be used together. If the jointly
managed account has an online banking payment function, Tsining must ensure that
the payment from the jointly managed account be completed only after obtaining
Cube’s authorization. In addition, concerning Tsining utilizing the capital in
the Entrusted Loan, Cube will appoint relevant personnel for the purposes of an
monitoringthe account. Cube will monitor the actual usage of the Entrusted Loan
in accordance with the provisions stipulated in this Agreement, in order to
ensure that the usage of the Entrusted Loan by the Tsining complies with
provisions in this Agreement.

 

 

Article 2: The Guarantee of the Entrusted Loan

 

2.1Besides the already existing guarantee measures for the Entrusted Loan,
Tsining and its affiliated companies agree to provide the following guarantee
measures to Cube:

 

(1)Upon the signing of this Agreement, Tsining and its affiliated companies
shall offer the following temporary security guarantees:

 

a)Two (2) sets of commercial properties totaling 2,053.23 square meters owned by
Tsining, which are located at “Xinxing Building” No. 88-89 Jianguo Road, Beilin
District, Xi’an, shall be used as security guarantees for the Entrusted Loan;

 

b)Twenty-five (25) residential properties totaling 1,579 square meters owned by
Shaanxi Xinxing Construction Project Co., Ltd. (hereinafter referred to as
“Xinxing Construction”), which are located at Junjingyuan I, No. 369 Jinhua
North Road, Xincheng District, Xi’an, shall be used as security guarantees for
the Entrusted Loan;

 

c)Seven (7) factory buildings totaling 16,351.79 square meters owned by Xi’an
Tianma Machinery Factory (hereinafter referred to as “Tianma Machinery
Factory”), which are located at No. 66 Huzhu Road, Beilin District, Xi’an, shall
be used as security guarantees for the Entrusted Loan.

 

(For an inventory of the above-mentioned mortgage properties, see Appendix A
hereto. The properties are collectively referred to herein as the “Temporary
Mortgages”).

 

For the aforementioned Temporary Mortgages, Tsining shall maintain insurance
approved by Cube.

 

(2)After the approval of the responsible local bureau of commerce, the parent
company of Tsining, Hong Kong Clever, shall use 100% of the equity of Tsining
held by it to offer a equity pledge guarantee for the Entrusted Loan, and shall
complete the registration formalities for the equity pledge with the applicable
industrial and commercial registration department, and Cube shall be the
first-order pledgee.

 

Cube agrees that after the above-mentioned equity pledge is finished, the pledge
of 100% of the equity of the Xi’an Disuo Trade and Business Co., Ltd. held by
Xi’an Xinxing Property Management Co., Ltd. shall be lifted.

 

(3)The other guarantors for the Entrusted Loan agree to use the guarantee
measures offered by them previously to continue tendering a guarantee for the
Entrusted Loan, and at this point, to offer a written confirmation to Cube (for
a form of its contents, see Appendix B hereto) for confirmation.

 

 

 

 

 

(4)Tsining agrees that within fifteen (15) business days from the day of
obtaining the Xinqingfang Project land use right certificate, Tsining will use
the Xinqingfang Project land use right and the construction in process (if
applicable) as a security guarantee for the Entrusted Loan, and Cube (or the
Bank) will be the first-order mortgagee of this security guarantee. Before this,
Cube shall appoint personnel to be responsible for keeping the original of the
Xinqingfang Project land use certificate. After going through the registration
formalities for the above-mentioned mortgages for the Xinqingfang Project land,
and if the mortgage rate of the Entrusted Loan (mortgage rate = assessed value
of all the security guarantees for the Entrusted Loan approved by Cube ÷
remaining sum of the principal of the Entrusted Loan ×100%) is not less than
50%, Cube agrees that the registration for the Temporary Mortgages shall be
lifted;

 

(5)Tsining shall use all the present and future accounts receivable of
Xinqingfang Project owned by Tsining to tender a guarantee to Cube.

 

2.2The aforementioned guarantee measures stipulated in Clause 2.1(1) to (3) are
the prerequisites for Tsining to use the Entrusted Loan in accordance with this
Agreement. If registration is needed, unless otherwise consented to by Cube in
writing, Tsining shall ensure that the mortgage or pledge must be registered
under Cube or under the name of the Bank within fifteen (15) business days after
the execution of this Agreement.

 

2.3Since the “Changanjiyong (2000) No. 2” Collective Land Use Right Certificate
(which contains an area of 1055.684 acres of land) held by Tsining’s
subsidiary—Xi’an Suodi Trading Company could not be used in the mortgage
registration by the registration authority at present, Cube agrees that the
aforementioned collective land use right will not be used as mortgage guarantee
for the Entrusted Loan.

 

Article 3: Undertakings of Tsining

 

3.1Tsining agrees it will ensure that the land used for the project can be
publicly sold by listing on 31st January, 2012 at the latest, and obtain the
certificate for use of the land no later than 31st March, 2012.

 

3.2Tsining promises to Cube that, with regard to the development and
construction of Xinqingfang Project:

 

(1)The progress of Xinqingfang Project and indexes of sales cash flow shall be
in compliance with the indexes listed in the table below:

 

Development Indexes By the end of February 2012 Obtain land transaction
confirmation By the end of March 2012 Obtain land certificate and mortgage the
land to the entrusted loan lender By the end of April 2012 Obtain land use
planning permit By the end of May 2012 Obtain construction project planning
permit By the end of June 2012 Obtain construction permit and pre-sale permit
Indexes of Sales Cash Inflow By the end of June 2012 RMB 70 million By the end
of July 2012 RMB 150 million By the end of August 2012 RMB 250 million

 

(2)Starting February 2012, every month RMB 10 million shall be extracted from
the sales revenue of Junjingyuan Third Phase or other income recognized by
Tsining other than the Xinqingfang Project to repay Cube the principal on the
loan until the principal of the loan and interests are fully paid.

 

 

 

 

 

If the index of cash flow generated by any phase of Xinqingfang Project is not
met, Tsining shall make up the difference with other income, and transfer them
into the account of the Xinqingfang Project supervised by Cube, which will be
regarded as complying with the index.

 

If in any phase the development index or the index of sales cash inflow under
Clause 3.2(1) is not met, unless Cube and Tsining agree on other conditions to
the satisfaction of Cube, Cube will have the right to supervise and manage the
banking account of Junjingyuan Third Phase.

 

(3)The monthly cash outflow of the Xinqingfang Project during its development
process shall not exceed the following budgets:

 

Time and Place Cash Expenditure Budget (RMB)

 Usage

December 2011 to January 2012 RMB 230 million Used for payment of land The First
Quarter of 2012 RMB 30 million Used for payment of initial cost of project,
project funds and other relevant costs The Second Quarter of 2012 RMB 40 million
July 2012 to August 2012 RMB 10 million

 

The above budgets are based on the following assumptions: (a) land-transferring
fees to be paid shall be no more than RMB 230 million; if they exceed that, the
above budgets can increase accordingly; (b) land-transferring fees and/or
transaction bonds began to be paid in December 2011; if the time is delayed, the
budget schedule would also be delayed accordingly; (c) the project will be
pre-sold starting June 2012; if the presale is conducted ahead of schedule, Cube
can negotiate with Tsining to adjust the budget. The above data can be further
adjusted if both parties agree.

 

(4)The monthly lowest price and the monthly average price of Xinqingfang Project
shall not be lower than those listed in the table below:

 

Type of Property The Monthly Lowest Price/RMB  Monthly Average Price/RMB
Ordinary Residence 6,000 7,000 Small Apartment (blank) 6,000 7,000 Shop on
Ground Floor 12,000 15,000 Commercial Plaza 18,000 21,000

 

If any pre-sale (or sale) price is lower than the above ones, Tsining must
notify Cube ahead of time and obtain approval from Cube.

 

(5)Since the “Xi’an Baqiao A and Baqiao B Project” stipulated previously by the
two parties in the Financing Transaction Documents is no longer applicable,
except otherwise provided by this Agreement, Cube agrees that Tsining should
continue monitoring the inflow and outflow of capital of Xinqingfang Project in
accordance with the capital supervision measures stipulated in the Capital
Supervision Agreement signed on 12 (month) 6 (day) 2011 by the two parties. In
the Capital Supervision Agreement, “Xi’an Baqiao A and Baqiao B Project” will be
replaced as Xinqingfang Project.

 

(6)According to the requirements of Cube, Tsining agrees to maintain appropriate
insurance for the in-progress constructions of the Xinqingfang Project.

 

3.3Tsining hereby agrees that after this Agreement goes into effect until
Tsining repays all the loans and related costs, Tsining will observe and satisfy
the following unless the prior written consent of Cube is first obtained:

 

(1)Tsining agrees that when it issues and distributes documents (including the
formal reports, notices, statements, etc.) relating to Xinqingfang Project to
its shareholders, it will send a copy of these documents to Cube.

 

(2)After signing this Agreement, Tsining shall provide Cube the following files:

 

 

 

 

 

a)Within the Entrust Loan period, before the 15th of each month, Tsining shall
submit to Cube the previous month’s bank statements of the jointly managed
account and bank statements from other bank accounts of Tsining;

 

b)Before the 15th of each month, Tsining shall submit to Cube the previous
month’s unaudited financial statements;

 

c)Tsining shall submit to Cube the weekly sale and operation information of
Xinqingfang Project after sales begin.

 

(3)If any of the following circumstances occur, Tsining must give Cube advance
written notice in and obtain Cube’s approval:

 

a)If any expenditure of Tsining’s will exceed RMB 1,000,000 and is not included
in the originally agreed upon budget;

 

b)If Tsining’s monthly spending will exceed RMB 3,000,000.

 

In this clause, concerning the items for which Tsining must obtain prior written
consent of Cube, Cube shall reply to Tsining within three (3) business days
after Tsining submits a written notice (including emails). If such response time
exceeds three (3) business days, this shall be considered as the tacit approval
of Cube.

 

3.4Tsining and its affiliates agree, except otherwise provided by this
Agreement, that Tsining and its affiliates will continue to observe and fulfill
all the stipulations in the Financing Transaction Documents.

 

Article 4: Entrusted Loan’s Extension

 

4.1Cube agrees to extend the Entrusted Loan by six (6) months upon its
expiration date of 27th January, 2012.

 

4.2Tsining shall pay Cube consulting fee for the extension period on the date
Tsining receives a written document in which the Bank agrees to give an
extension for the loan, which is 6.8% of the loan in the extension period.

 

4.3During the extension period of the Entrusted Loan, the monthly interest shall
stay the same.

 

Article 5: Termination of The Financing Transaction

 

5.1After signing this Agreement, Cube shall have right to terminate this
financing transaction in the following circumstances:

 

(1)Subject to a written waiver by Cube, the security described in Clause 2.1 (1)
to Clause 2.1 (3) of this Agreement cannot be satisfied on January 31, 2012;

 

(2)Subject to a written waiver by Cube, Tsining fails to acquire the land needed
for this project, or is unable to acquire such land before March 31, 2012;

 

(3)Cube has the right to terminate to terminate this transaction when there are
conditions that are due to the fault of Tsining as described in laws,
regulations, this Agreement, or the financing transaction documents.

 

5.2If Cube terminates this financing transaction according to this provision,
then the loan will be due immediately, Cube and/or the bank shall have right to
demand Tsining to pay back all the loans, all the interest and fees, and also
pay the penalties for breach of contract according to following, whichever is
higher:

 

(1)20% of total amount of the loans issued by the bank; or

 

 

 

 

 

(2)0.0015% for each day of total amount of the loans, starting from the date of
the issuance of loans to the date of repayment of all the loans. Any fees paid
by Tsining to Cube concerning this financing transaction will not be returned.

 

In addition, Cube shall have right to demand guarantees that Tsining will bear
liabilities.

 

Article 6 Other Arrangements

 

6.1The governing law and resolution of dispute provisions of the Project
Financing Agreement shall also apply to this Agreement.

 

6.2This Agreement is the amendment and supplement to the financing transaction
documents. In case any arrangements in the financing transaction documents and
relevant contracts or materials are different from those in this supplementary
agreement, this Agreement shall prevail.

 

6.3This Agreement and the financing transaction documents shall have the same
legal effect. Tsining shall be considered to have breached the contract if it
violates the arrangements in this Agreement, Cube shall have right to take
proper action to protect its rights and interests according to the financing
transaction documents and this Agreement, including, but not limited to,
announcing that the loan will be terminated before its due date, and demanding
Tsining and other parties to bear reasonable liabilities.

 

6.4This Agreement shall become effective after the affixation of the signatures
of each party’s authorized representatives in six copies, each party having
three copies with equal legal validity.

 

(Remainder of page intentionally left blank)

 

 

Tianjin Cube Xindao Equity Investment Fund Partnership (LLP) (Seal)

 

Tianjin Cube Xinde Equity Investment Fund Partnership (LLP)

 

Tianjin Cube Xinren Equity Investment Fund Partnership (LLP)

 

Tianjin Cube Xinyi Equity Investment Fund Partnership (LLP)

 

Signature of the Authorized Representative: /s/ Authorized Person

Name: Authorized Person

Title: Authorized Person

 

Tsining Housing Development Co., Ltd.
                                                       (Seal)

 

Signature of the Authorized Representative: /s/ Authorized Person

Name: Authorized Person

Title: Authorized Person

 

Clever Advance Limited
                                                                                 (Seal)

 

Signature of the Authorized Representative: /s/ Authorized Person

Name: Authorized Person

Title: Authorized Person

 

Signature Page to Supplemental Agreement to the Project Financing Agreement

 

 

 

Exhibit A: List of the Additional Collateral

 

 

No. Project Address Room No. Floor Area Nature of Property No. of Property
Ownership Certificate Owner 1 Xinxing Mason No. 88 Jianguo Rd, Beilin District
9-30201 2 277.03 Commercial 112510808IV-52-9-30201 Tsining Housing Development
Co., Ltd. 2 Xinxing Mason No. 88 Jianguo Rd, Beilin District 9-30711 7 776.20
Commercial 112510808IV-52-9-30711 Tsining Housing Development Co., Ltd.
Sub-total 2,053.23       3 Xinqingfang No. 66 Huzhu Rd, Beilin District 26 1
1,915.32 Industrial Factory N/A Tianma Machinery Factory 4 Xinqingfang No. 66
Huzhu Rd, Beilin District 1 4 3,488.32 Industrial Factory N/A Tianma Machinery
Factory 5 Xinqingfang No. 66 Huzhu Rd, Beilin District 113 2 1,472.04 Industrial
Factory N/A Tianma Machinery Factory 6 Xinqingfang No. 66 Huzhu Rd, Beilin
District 6 2 2,406.48 Industrial Factory N/A Tianma Machinery Factory 7
Xinqingfang No. 66 Huzhu Rd, Beilin District 5 2 6,073.45 Industrial Factory N/A
Tianma Machinery Factory 8 Xinqingfang No. 66 Huzhu Rd, Beilin District 7 2
996.18 Industrial Factory N/A Tianma Machinery Factory Sub-total 16,351.79      
9 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11108 11 123.18
Residential 1150110019-4-12-11108~1 Shaanxi Xinxing Construction Project Co.,
Ltd 10 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11109 11 56.79
Residential 1150110019-4-12-11109~1 Shaanxi Xinxing Construction Project Co.,
Ltd 11 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11111 11 56.10
Residential 1150110019-4-12-11111~1 Shaanxi Xinxing Construction Project Co.,
Ltd 12 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11112 11 56.43
Residential 1150110019-4-12-11112~1 Shaanxi Xinxing Construction Project Co.,
Ltd 13 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11113 11 56.43
Residential 1150110019-4-12-11113~1 Shaanxi Xinxing Construction Project Co.,
Ltd 14 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11115 11 55.23
Residential 1150110019-4-12-11115~1 Shaanxi Xinxing Construction Project Co.,
Ltd 15 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11120 11 54.85
Residential 1150110019-4-12-11120~1 Shaanxi Xinxing Construction Project Co.,
Ltd

 

 

 

 

 

16 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11118 11 55.15
Residential 1150110019-4-12-11118~1 Shaanxi Xinxing Construction Project Co.,
Ltd 17 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11208 12 123.18
Residential 1150110019-4-12-11208~1 Shaanxi Xinxing Construction Project Co.,
Ltd 18 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11209 12 56.79
Residential 1150110019-4-12-11209~1 Shaanxi Xinxing Construction Project Co.,
Ltd 19 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11210 12 56.79
Residential 1150110019-4-12-11210~1 Shaanxi Xinxing Construction Project Co.,
Ltd 20 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11212 12 56.43
Residential 1150110019-4-12-11212~1 Shaanxi Xinxing Construction Project Co.,
Ltd 21 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11219 12 55.15
Residential 1150110019-4-12-11219~1 Shaanxi Xinxing Construction Project Co.,
Ltd 22 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11211 12 56.10
Residential 1150110019-4-12-11211~1 Shaanxi Xinxing Construction Project Co.,
Ltd 23 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11213 12 56.43
Residential 1150110019-4-12-11213~1 Shaanxi Xinxing Construction Project Co.,
Ltd 24 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11214 12 54.46
Residential 1150110019-4-12-11214~1 Shaanxi Xinxing Construction Project Co.,
Ltd 25 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11215 12 55.23
Residential 1150110019-4-12-11215~1 Shaanxi Xinxing Construction Project Co.,
Ltd 26 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11216 12 53.79
Residential 1150110019-4-12-11216~1 Shaanxi Xinxing Construction Project Co.,
Ltd 27 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11217 12 55.15
Residential 1150110019-4-12-11217~1 Shaanxi Xinxing Construction Project Co.,
Ltd 28 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11218 12 55.15
Residential 1150110019-4-12-11218~1 Shaanxi Xinxing Construction Project Co.,
Ltd 29 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11220 12 54.85
Residential 1150110019-4-12-11220~1 Shaanxi Xinxing Construction Project Co.,
Ltd 30 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11110 11 56.79
Residential 1150110019-4-12-11110~1 Shaanxi Xinxing Construction Project Co.,
Ltd 31 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11114 11 54.46
Residential 1150110019-4-12-11114~1 Shaanxi Xinxing Construction Project Co.,
Ltd

 

 

 

 

 

32 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11116 11 53.79
Residential 1150110019-4-12-11116~1 Shaanxi Xinxing Construction Project Co.,
Ltd 33 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11117 11 55.15
Residential 1150110019-4-12-11117~1 Shaanxi Xinxing Construction Project Co.,
Ltd 34 Junjingyuan No. 369 Jinhua North Rd, Xincheng District 12-11119 11 55.15
Residential 1150110019-4-12-11119~1 Shaanxi Xinxing Construction Project Co.,
Ltd Sub-total 1,579.00       Total 19,984.02      

 

 

 

 

 

 

 

Exhibit 2: Form of Letter of Confirmation by Guarantor

 

Letter of Confirmation of Security

 

The Letter of Confirmation is made and entered into by and among following
parties on [......], 201_:

 

(1)Shanxi Xinxing Construction Project Co., Ltd. (“Xinxing Construction”) is a
limited liability company duly incorporated and legally existing under the laws
of China, with its address at No. 88, Jianguo Road, Xi’an City.

 

(2)Xi’an Xindadi Development Co., Ltd. (“Xindadi”) is a limited liability
company duly incorporated and legally existing under the laws of China, with its
address at No. 9, Baqiao Park West Road, Baqiao District, Xi’an City.

 

(3)Xi’an Xinxing Property Management Co., Ltd. (“Xinxing Property”) is a limited
liability company duly incorporated and legally existing under the laws of
China, with its address at Room 501, Fifth Floor, No.6 Xinxing Hanyuan, Youyi
East Road, Beilin District, Xi’an City.

 

(4)Wayfast Holdings Limited (“Wayfast Holdings”) is a limited liability company
duly incorporated and legally existing under the laws of British Virgin Islands.

 

(5)China Housing and Land Development Inc. (“China Housing”) is a limited
liability company duly incorporated and legally existing under the laws of
United States.

 

(6)Pingji LU, a Chinese citizen.

 

(Each of the above parties shall be hereinafter referred to as a “Party”
respectively, and as the “Parties” collectively.)

 

Whereas:

 

1)With regard to the financing matters of Xi’an Baqiao A and Baqiao B Project
(the “Financing”), Tianjin Cube Xindao Equity Investment Fund Partnership (LLP),
Tianjin Cube Xinde Equity Investment Fund Partnership (LLP), Tianjin Cube Xinren
Equity Investment Fund Partnership (LLP) and Tianjin Cube Xinyi Equity
Investment Fund Partnership (LLP) (the “Cube” collectively) has executed the
Project Financing Agreement as well as other relative agreements and legal
documents (the “Financing Transaction Documents”) with Tsining Housing
Development Co., Ltd. (the “Tsining”), and has already disbursed the entrustment
loan totaling RMB 200,000,000 (the “Entrustment Loan”) to Tsining via China
Construction Bank Shanxi Branch (the “Bank”);

 

Each party has provided the mortgage, pledge or guarantee to the Financing
respectively, and has executed the below security agreements or security
documents with Cube or the Bank thereby:

 

a)The Guarantee Agreement signed between Xinxing Construction and Cube at the
date of Month/Date 201_;

 

b)The Guarantee Agreement signed between Xindadi and Cube at the date of
Month/Date 201_;

 

c)Four Equity Pledge Agreements signed respectively between Xinxing Property and
Cube at the date of Month/Date 201_;

 

d)The Share Charge signed between Wayfast Holdings and Cube at the date of
Month/Date 201_;

 

e)The Guarantee Agreement and Equity Pledge Agreement signed between China
Housing as well as Tsining and Cube at the date of Month/Date 201_;

 

f)The Entrustment Loan Guarantee Agreement signed between Pingji LU and Cube at
the date of Month/Date 201_.

 

 

 

 

 

(The below security agreements or security documents shall be hereinafter
referred to as “Security Documents” collectively )

 

During the process of performing the Project Financing Agreement, the
Supplemental Agreement to the Project Financing Agreement (the “Supplemental
Agreement”) is made and entered into by and between Cube and Tsining at the date
of Month/Date 201_.

 

In order to clarify the security liabilities provided by each party to Cube for
Xining, each party represents and warrants that:

 

1)Each party understands and confirms that the Supplemental Agreement is made
and entered into by and between Cube and Tsining at the date of Month/Date 201_.
Each party is aware of and consent to the Supplemental Agreement signed by
Tsining. In particular, each party agrees that Cube provide a six-month
extension to the loan of Tsining on the basis of the original loan term.

 

2)The parties consent to continuously secure the obligations under the Financing
Transaction Documents and the Supplemental Agreement for Tsining. If there are
amendments or supplements to the terms of the Security Documents that have been
signed by one party or the parties, one party or the parties shall be liable to
the terms that have been amended or supplemented. Particularly, regarding the
joint and severable guarantee liabilities borne by each party pursuant to the
Security Documents, the parties agree that the term of guarantee shall be two
years from the expiration date after the six (6) month extension of the loan
term.

 

3)This Letter of Confirmation shall become effective on the date of execution.

 

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Shanxi Xinxing Construction Project Co., Ltd.     (Seal)

 

By Authorized Agent

 

Xi’an Xindadi Development Co., Ltd.                    (Seal)

 

By Authorized Agent

 

Xi’an Xinxing Property Management Co., Ltd. (Seal)

 

By Authorized Agent

 

Wayfast Holdings Limited                                         (Seal)

 

By Authorized Agent

 

China Housing and Land Development Inc.        (Seal)

 

By Authorized Agent

 

Pingji LU

 

Signature: _______________________

 

Signature Page of the Letter of Confirmation of Security