Exhibit
10.20  Dated the 22ndday of December 2003  JUGADA COMPANY LIMITED
(as Landlord)   AND   VALENCE TECHNOLOGY LIMITED
(as Tenant)   
  TENANCY AGREEMENT  of  Workshop
No.01-07 on the 20th Floor of APEC Plaza, No.49 Hoi Yuen Road, Kwun Tong,
Kowloon, Hong Kong  Term:A term of Three (3) years from 16th
November 2003 to 15th November 2006  Rental:HK$43,433.00
per month exclusive of rates, management fee and central chilled water charges  Deposit:HK$191,439.30  
   JOHNSON STOKES &MASTER,  SOLICITORS, & C.,  HONG KONG SAR.  MSY/CH/6560682/sy pc/ifd46793.w
(300703)  
   SECTION I  AGREEMENT  Parties
  
  AN
  AGREEMENT made this 22nd day of December Two Thousand and ThreeBETWEEN
  (i) the Company detailed as the Landlord in Part I of the Schedule hereto
  (hereinafter called the Landlord which expression shall include its
  successors and assigns) of the one part and (ii) the person firm or company
  detailed as the Tenant in Part I of the Schedule hereto (hereinafter
  called the Tenant which expression shall include its successors and
  permitted assigns) of the other part.WHEREBY
  IT IS AGREED as follows :-1.
  
  
  
  Agreement
  :-Premises
  
  1.01
  
  
  
  The
  Landlord shall let and the Tenant shall take ALL THOSE the premises
  (hereinafter referred to as the Premises) forming part of the building now
  known as APEC Plaza, No.49 Hoi Yuen Road, Kwun Tong, Kowloon, Hong Kong
  (hereinafter referred to as the Building) erected on All That piece or
  parcel of land registered in the Land Registry as Kwun Tong Inland Lot No.731
  which said Premises are more particularly described and set out in Part II of
  the Schedule attached hereto Together with the use in common with the
  Landlord and all others having the like right of the entrances staircases
  landings passages and public toilets in the Building in so far as the same
  are necessary for the proper use and enjoyment of the Premises and except in
  so far as the Landlord may from time to time restrict such use And together
  with the use in common as aforesaid of the escalators and air cooling
  services in the Building (if any and whenever the same shall be operating)
  for the term set forth in Part III of the Schedule hereto (hereinafter
  the Term) YIELDING AND PAYINGTerm
  Rent and other Charges [SEAL]  1 
   therefor throughout the
  Term such rent and other charges as are from time to time payable or
  ascertainable in accordance with the provisions set out in Part IV and Part
  -V- of the Schedule hereto and in this Agreement (all of which payments
  are unless the context otherwise requires or provides hereinafter included in
  the term the Rent) which sums shall be payable exclusive of rates and other
  outgoings and in advance clear of all deductions on the first day of each
  calendar month the first and last of such payments to be apportioned
  according to the number of days in the month included in the Term.  The Tenant agrees to use the Premises only
  for the purpose set forth in Part VII of the Schedule hereto and not for
  any other purpose and in the event that the user of the Premises designated
  in Part VII of the Schedule hereto shall specify the sale or supply
  thereat of any particular class or kind of goods or services the Tenant shall
  not use the Premises for the sale or provision of any other class or kind of
  goods services or other purpose whatsoever without the express permission of
  the Landlord in writing.UserSECTION II
  RENT AND OTHER CHARGES2.
  
  
  
  The
  Tenant agrees with the Landlord as follows :-Rent
  
  2.01
  
  
  
  To
  pay throughout the Term on the days and in the manner hereinbefore provided
  for payment thereof and in banknotes if so required by the Landlord such
  calendar monthly rent as is payable in accordance with the provisions of Part
  IV of the Schedule hereto;  2 
   Management
  fee and central chilled water charges
  
  2.02
  
  
  
  To
  pay on the days and in the manner hereinbefore provided the management fee
  and central chilled water charges as respectively set forth, in Part V of the
  Schedule for the provision of management services for the Premises and
  for the supply of chilled water for use by the Tenant in connection with its
  air-conditioning installation Provided always that the rate of the said management
  fee and central chilled water charges shall be subject to review by the
  Manager of the Building in accordance with the provisions in the Deed of
  Mutual Covenant and Management Agreement relating to the Building.  The Managers determination of the new
  rate of the said management fee and central chilled water charges shall (save
  in the case of manifest error) be conclusive.All
  running, operating, maintenance, cleaning and repair costs associated with
  the use of fan coil units or other air handling plant installed at the
  Premises will be borne by the Tenant in addition to the management fee and
  central chilled water charges.  The
  electric power for such fan coil units or other air handling plant installed
  within or exclusively for the Premises shall be connected to the Tenants
  electricity supply meter and the Tenant shall pay direct to the supply
  authority or contractor for the electric power thereby consumed.Rates
  
  2.03
  
  
  
  To
  pay and discharge all rates taxes assessments duties impositions charges and
  outgoings of an annual or recurring nature now or hereafter to be imposed or
  levied on the Premises or upon the owner or occupier in respect thereof by
  the Government of the Hong Kong Special Administrative Region of the Peoples
  Republic of China or other lawful authority (Government Rent and Property Tax
  alone excepted).  Without prejudice to
  the generality of this clause the  3 
   Tenant
  shall within 15 days from the date of receiving a demand in writing for the
  same either from the Landlord or from the Government of the Hong Kong Special
  Administrative Region of the Peoples Republic of China pay all rates imposed
  on the Premises in the first place to the Landlord who shall settle the same
  with the Government of the Hong Kong Special Administrative Region of the
  Peoples Republic of China.  In the
  event of the rates imposed not being individually assessed in respect of the
  Premises, the Tenant shall pay a part thereof in the same proportion as the
  gross floor area of the Premises bears to the gross floor area of the
  Building or part thereof so assessed, and in the event of the Premises not
  yet having been assessed to rates, the Tenant shall on the signing hereof and
  before it shall be entitled to possession of the Premises at the commencement
  of the Term and thereafter on each of the usual quarter days until the rates
  have been so assessed pay to the Landlord on account of the Tenants
  liability under this Clause a sum equal to the rates for that quarter (or a
  proportionate part thereof) which would be charged by the Government of the
  Hong Kong Special Administrative Region of the Peoples Republic of China on
  the basis of a rateable value equal to twelve months rent payable by the
  Tenant (such estimated rates to be paid on monthly basis in advance);
  Provided that upon assessment by the Government of the Hong Kong Special
  Administrative Region of the Peoples Republic of China of the rates payable
  in respect of the Premises, the total amount paid by the Tenant to the
  Landlord shall be adjusted accordingly and any surplus shall be refunded by
  the Landlord and any deficiency shall be made good by the Tenant.  4 
   Utility
  Charges & Deposits
  
  2.04
  
  
  
  To
  pay and discharge all deposits and charges in respect of gas water
  electricity air-conditioning and telephone as may be shown by or operated
  from the Tenants own metered supply or by accounts rendered to the Tenant in
  respect of all such utilities consumed on or in the Premises.SECTION III
  TENANTS OBLIGATIONS3.The Tenant hereby covenants undertakes and
  agrees with the Landlord as follows :-Compliance
  with Ordinances
  
  3.01
  
  
  
  To
  obey observe and comply with and to indemnify the Landlord against the breach
  of all ordinances, regulations, by-laws, rules and requirements of any
  Governmental or other competent authority relating to the use and occupation
  of the Premises, or to any other act, deed, matter or thing done, permitted,
  suffered or omitted therein or thereon by the Tenant or any employee, agent
  or licensee of the Tenant and without prejudice to the foregoing to obtain
  any licence approval or permit required by any Governmental or other
  competent authority in connection with the Tenants use or occupation of the
  Premises prior to the commencement of the Tenants business and to maintain
  the same in force and in all respects comply with the terms thereof during
  the currency of this tenancy and to indemnify the Landlord against the
  consequences of any breach of this provision;Fitting
  Out the Interior of the Premises
  
  3.02
  
  (a)
  
  To
  fit out the interior of the Premises in accordance with such Premises plans
  and specifications including but not limited to electrical and mechanical
  layout, P & D design, etc. as shall have been first submitted by the
  Tenant to and approved in writing by the Landlord in a good and  5 
   proper
  workmanlike fashion.  Such fitting out
  works must not be commenced before such plans and specifications have been
  approved by the Landlord.(b)
  
  The
  Tenant shall pay to the Landlord on demand all mechanical, engineering and
  structural engineering consultants fees incurred by the Landlord in
  connection with the consideration and approval of the Tenants Plans or any
  modifications or amendments thereof.Installation
  of Telephone Cables
  
  3.03
  
  
  
  To
  make its own arrangements with regard to the installation of telephones or
  other communications systems within the Premises, but the installation of
  telephone and communications lines outside the Premises must be in the common
  ducting provided for that purpose and in all respects be in accordance with
  the Landlords directions;Good
  Repair of Interior
  
  3.04
  
  
  
  To
  keep all the interior part of the Premises including the flooring and
  interior plaster or other finishing material or rendering to walls floors and
  ceilings and the shopfront external grilles or shutters to the Premises and
  the Landlords fixtures and fittings therein and all additions (whether of
  the Landlord or the Tenant) thereto including (without limitation and
  wherever the same shall be installed in or upon the Premises) all escalators
  doors windows electrical installations and wiring light fittings suspended
  ceiling fire fighting apparatus and air-conditioning plant and ducting
  exhaust ducts, scrubber and carbon filters, grease traps and all pipes
  plumbing and drainage facilities and all painting, papering and decoration
  thereof in good clean tenantable substantial and proper repair and condition
  and as may be appropriate from time to time properly painted and decorated
  cleansed cleared or  6 
   replaced
  and so to maintain the same at the expense of the Tenant and to deliver up
  the same and all fittings, fixtures and additions therein and thereto other
  than tenants fixtures and fittings to the Landlord at the expiration or
  sooner determination of the said term in like condition and without prejudice
  to the generality of the foregoing during the last year of the term hereby
  reserved if reasonably required by the Landlord to repaint and decorate the
  interior of the Premises;Cleaning
  of Grease Trap
  
  3.05
  
  
  
  To
  clean and clear every grease trap (if any, and whether within or outside the
  Premises) serving the Premises or used by the Tenant as often as is necessary
  to ensure the free, uninterrupted and efficient working of the drainage and
  sewage facilities serving the Building. The Landlord shall be entitled from
  time to time to require the Tenant to do such cleaning and clearing at such
  regular intervals as may be prescribed by the Landlord. If default shall be
  made by the Tenant in fulfilling its obligations under this Clause the
  Landlord shall be entitled to do such cleaning and clearing, entering the
  Premises whenever necessary and the cost thereof shall be a debt due from the
  Tenant to the Landlord and be recoverable forthwith by action;Installation
  of wires cables and services
  
  3.06
  
  
  
  To
  install all wires pipes and cables and other services serving the Premises in
  and through the duets trunkings and conduits in the Building provided by the
  Landlord for such purposes and at all times in accordance with the Landlords
  directions and not to install any such wires pipes cables or other services
  without first providing the Landlord with full particulars and a fully
  detailed plan and diagram of such intended installation and obtaining the
  Landlords consent in regard thereto.  7 
   Replacement
  of Windows
  
  3.07
  
  
  
  To
  pay to or reimburse the Landlord the cost of replacing all broken or damaged
  windows or shopfront glass whether the same be broken or damaged by the
  negligence of the Tenant or owing to circumstances beyond the control of the
  Tenant;Repair
  of Electrical Installations
  
  3.08
  
  
  
  To
  repair or replace as so required by the appropriate utility company or
  authority under the terms of the Electricity Supply Ordinance or any
  statutory modification or re-enactment thereof or Regulations made thereunder
  by duly authorised contractor, statutory undertaker or authority as the case
  may be all the electricity wiring installations and fittings within the
  Premises and the wiring from the Tenants meter or meters to and within the
  same;Good
  Repair of Toilets & Water Apparatus
  
  3.09
  
  
  
  At
  the expense of the Tenant to maintain all toilets and sanitary and water
  apparatus as are located within the Premises (or elsewhere if used
  exclusively by the Tenant its employees invitees and licensees) in good clean
  and tenantable state and in proper repair and condition at all times during
  the said Term to the satisfaction of the Landlord and in accordance with the
  Regulations of the Public Health or Government Authority concerned;Cleaning
  & Cleaning Contractors
  
  3.10
  
  
  
  To
  keep the Premises including all external windows lights and shopfront glass
  at all times in a clean and sanitary state and condition, and for the better
  observance hereof the Tenant shall only employ as cleaners of the Premises
  such persons or firms as shall be nominated by the Landlord. Such Cleaners
  shall be employed at the expense of the Tenant;Cleaning
  of Drains
  
  3.11
  
  
  
  To
  pay on demand to the Landlord the cost properly incurred by the Landlord in
  cleansing and clearing any of the drains  8 
   choked
  or stopped up owing to improper or careless use by the Tenant or his
  employees invitees or licensees;To
  Permit Landlord To Enter & View
  
  3.12
  
  
  
  To
  permit the Landlord its agents and all persons authorised by it with or
  without workmen or others and with or without appliances at all reasonable times
  to enter upon the Premises to view the condition thereof and upon prior
  notice to the Tenant to take inventories of the fixtures and fittings therein
  and to carry out any work or repair required to be done provided that in the
  event of an emergency the Landlord its servants or agents may enter without
  notice and forcibly if need be;To
  Execute Repair on Receipt of Notice
  
  3.13
  
  
  
  To
  make good all defects and wants of repair to the Premises for which the
  Tenant may be liable within the space of one month from the receipt of
  written notice from the Landlord to repair amend and make good the same, and
  if the Tenant shall fail to execute such works or repairs as aforementioned
  to permit the Landlord to enter upon the Premises and execute the same and
  the cost thereof shall be a debt due from the Tenant to the Landlord and be
  recoverable forthwith by action;Inform
  Landlord of Damage
  
  3.14
  
  
  
  To
  give prompt notice to the Landlord or its agent of any damage that may be
  suffered to the Premises and of any accident to or defects in the water and
  gas pipes (if any) electrical wiring or fittings, fixtures or other services
  or facilities within the Premises;Protection
  from Typhoon
  
  3.15
  
  
  
  To
  take all necessary and appropriate precautions to protect the interior of the
  Premises from storm or typhoon damage;Indemnification
  of Landlord
  
  3.16
  
  
  
  To
  be wholly responsible for any loss damage or injury caused to any person
  whomsoever or to any property whatsoever directly or indirectly through the
  defective  9 
   or
  damaged condition or operation of any part of the interior of the Premises or
  any machinery or plant or any fixtures or fittings or wiring or piping
  therein for the repair of which the Tenant is responsible hereunder or in any
  way caused by or owing to the spread of fire smoke or fumes or the leakage or
  overflow of water of whatsoever origin from the Premises or any part thereof
  or through the act default or neglect of the Tenant his servants agents
  contractors licensees partners or customers and to make good the same by
  payment or otherwise and to indemnify the Landlord against all costs claims
  demands actions and legal proceedings whatsoever made upon the Landlord by any
  person in respect of any such loss damage or injury as aforesaid and all
  costs and expenses incidental thereto;Air-conditioning
  of Premises
  
  3.17
  
  
  
  Where
  any plant machinery or equipment for cooling or circulating air is installed
  in or about the Premises (whether by the Landlord or the Tenant) the Tenant
  will to the extent of the Tenants control over the same at all times use and
  regulate the same to ensure that the air-conditioning plant is employed to
  best advantage in the conditions from time to prevailing and without
  prejudice to the generality of the foregoing will operate and maintain such
  plant within the Premises as the Landlord may reasonably determine to ensure
  a reasonably uniform standard of air cooling or conditioning throughout the
  Building;Refuse
  & Garbage Removal
  
  3.18
  
  
  
  To
  be responsible for the removal of refuse and garbage from the Premises to
  such location as shall be specified by the Landlord from time to time and to
  use only that type of refuse container as is specified by the Landlord from
  time to time. In the event of the Landlord providing a collection service for
  refuse and garbage the same shall be used by the Tenant to the exclusion of
  any other similar service and the use of  10 
   such
  service provided by the Landlord shall be at the sole cost of the Tenant;Service
  Entrances
  
  3.19
  
  
  
  To
  load and unload goods only at such times and through such entrances and by
  such service lifts (if any) as shall be designated by the Landlord for this
  purpose from time to time;Common
  Areas
  
  3.20
  
  
  
  To
  pay to or reimburse to the Landlord the cost of repairing any damage caused
  to any part of the common areas of the Building occasioned by the Tenant his
  licensees employees agents or contractors or any other person claiming
  through or under the Tenant;Contractors
  Employees Invitees & Licensees
  
  3.21
  
  
  
  To
  be liable for any act default negligence or omission of the Tenants
  contractors, employees invitees or licensees as if it were the act default
  negligence or omission of the Tenant and to indemnify the Landlord against
  all cost claims demands expenses or liability to any third party in
  connection therewith;Directory Boards
  
  3.22
  
  
  
  To
  pay the Landlord immediately upon demand the cost of affixing repairing or
  replacing as necessary the Tenants name in lettering to the directory boards
  at the Building;Regulations
  
  3.23
  
  
  
  To
  obey and comply with such Regulations as may from time to time be made or
  adopted by the Landlord in accordance with Section X hereof;Security
  System
  
  3.24
  
  
  
  To
  ensure that its own security system within and at the entrance of the
  Premises is at all times compatible with and linked up to the security system
  for the Building provided and operated by the Landlord (if any);  11 
   Yield
  Up Premises & Handover
  
  3.25
  
  
  
  To
  yield up the Premises with all fixtures fittings and additions therein and
  thereto at the expiration or sooner determination of this Agreement in good
  clean and tenantable repair and condition in accordance with the stipulations
  hereinbefore contained together with all keys giving access to all parts of
  the Premises Provided That(a)
  
  Where
  a suspended ceiling system (the Suspended Ceiling System) had been
  installed at the Premises (whether by the Landlord or was present either at
  the commencement of the Term or when the Tenant took possession of the
  Premises) the Tenant shall at its own cost reinstate repair and make good all
  damage caused to the Suspended Ceiling System to the satisfaction of the
  Landlord before delivering up possession of the Premises to the Landlord;(b)
  
  (i)
  
  Where
  there are any installations, additions, alterations, fittings and fixtures
  upon or in the Premises whether the same have been made or installed prior to
  or after the commencement of the Term; or(ii)
  
  Where
  the Tenant has made any alterations or installed any fixtures fittings or
  additions in or to the Premises and notwithstanding that the Landlords
  consent for so doing may have been obtained or have been given or be deemed
  to have been giventhe
  Landlord may at its sole discretion require the Tenant at the Tenants sole
  cost and expense to reinstate or remove or do away with all or any such
  installations, additions, alterations, fittings or fixtures or any part or
  portion thereof and to make good and repair in a proper and workmanlike
  manner any damage to the  12 
   Premises
  and the Landlords fixtures and fittings therein caused by such removal or
  reinstatement and deliver up the Premises to the Landlord in a bare shell
  condition to the satisfaction of the Landlord.SECTION IV
  LANDLORDS OBLIGATIONS4.
  
  
  
  The
  Landlord agrees with the Tenant as follows :-Quiet
  Enjoyment
  
  4.01
  
  
  
  To
  permit the Tenant duly paying the Rent rates and other charges and the
  service charge hereby agreed to be paid on the days and in manner herein
  provided for .payment of the same and observing and performing the agreements
  stipulations terms conditions and obligations herein contained to have quiet
  possession and enjoyment of the Premises during the said term without any
  interruption by the Landlord or any person lawfully claiming under or through
  or in trust for the Landlord;Government
  Rent
  
  4.02
  
  
  
  To
  pay the Government Rent and Property Tax attributable to or payable in
  respect of the Premises;Air-conditioning
  
  4.03
  
  
  
  To
  use reasonable endeavours to maintain the escalators, fire services
  equipment, security installations and air-conditioning plant and water
  chilling apparatus and other services provided within the Building not within
  the Premises in proper working order and condition;Chilled
  Water Supply
  
  4.04
  
  (a)
  
  Subject
  to Section VI Sub-clause 6.01(i) hereof to provide a supply of chilled
  water to the Premises for the purposes of the Tenants air-conditioning
  during the normal business hours to be decided by the Manager of the Building
  whose decision shall be final and conclusive;  13 
   (b)
  
  Subject
  to Section VI Sub-clause 6.01 (i) hereof the Landlord shall, at the
  absolute discretion of the Landlord, supply the Tenant with a supply of
  chilled water to the Premises for the purposes of the Tenants
  air-conditioning during hours outside the normal business hours upon request
  being made by the Tenant to the Landlord. 
  The cost for such additional hours of chilled water supply from time
  to time shall be determined by the Landlord or the building manager whose
  decision shall be final and notified to the Tenant from time to time and
  shall be paid by the Tenant to the Landlord with the rent and other charges
  payable under this Tenancy Agreement and shall be recoverable by the Landlord
  as part of the air-conditioning and management charges hereunder.Obligation
  Where Landlord not owner of Whole Building
  
  4.05
  
  
  
  In
  the event that the Landlord is not the owner of the whole of the Building,
  the obligations of the Landlord under Section IV Sub- Clauses 4.03 and
  4.04 hereof shall be deemed to have been modified so that the Landlord shall
  only be under an obligation to use reasonable endeavours to procure that the
  manager appointed under the Deed of Mutual Covenant or any Sub- Deed of
  Mutual Covenant affecting the Building or the incorporated owners of the
  Building shall do the things referred to in such Sub-Clauses to the extent
  that they are within the power and duty of the manager or incorporated owners
  and the Landlord shall not be liable to the Tenant or any other person for
  the failure on the part of the manager or incorporated owners to do any such
  things.Rights
  Reserved to the Landlord
  
  4.06
  
  
  
  It
  is hereby agreed and expressly confirmed that the following rights are
  excepted and reserved to the Landlord (its successors and assigns and all
  persons having the like right) throughout the said Term :-  14 
   (a)
  
  the
  right of free and uninterrupted passage and running of water, soil, gas,
  drainage, electricity and all other services or supplies through such sewers,
  watercourses, conduits, pipes, wires, cables and ducts as are now or may
  hereafter be in, on or under the Premises and serving or capable of serving
  the Building or any adjoining or neighbouring property TOGETHER WITH the
  right to enter upon the Premises to inspect repair replace or maintain any
  such sewers, watercourses, conduits, pipes, wires, cables and ducts Provided
  That in the exercise of this latter right the Landlord shall cause as little
  damage or inconvenience to the Tenant as possible and forthwith make good any
  damage caused;(b)
  
  the
  full and free right and liberty to enter upon the Premises in the
  circumstances in which the covenants by the Tenant contained in these
  presents permit such entry and in particular but without prejudice to the
  generality of the foregoing the right to enter into and upon the Premises at
  all times for the purpose of obtaining access to and egress from any
  machinery or switch rooms or the like remaining under the control of the
  Landlord and located on any of the floors of the Building on which any
  portion of the Premises is situated;(c)
  
  the
  right from time to time on giving reasonable notice to the Tenant (such
  notice not to be required in case of emergency or breakdown) and causing as
  little inconvenience to the Tenant as  15 
   reasonably
  possible to suspend the air-conditioning system, lifts, escalators, electric
  power, water supply and any other building service provided in or serving the
  Building for the purpose of servicing, maintaining, repairing, renewing,
  improving or replacing the same and any of them;(d)
  
  the
  right from time to time and without the necessity of joining the Tenant or
  any other person to enter into such Deed of Mutual Covenant or Sub-Deed of
  Mutual Covenant or Management Agreement affecting the Building or any part
  thereof as the Landlord shall deem appropriate.SECTION V
  RESTRICTIONS AND PROHIBITIONS5.
  
  
  
  The
  Tenant hereby agrees with the Landlord as follows :-Installation
  & Alterations
  
  5.01
  
  (a)
  
  Not
  without the previous written consent of the Landlord to erect install or
  alter any fixtures partitioning or other erection or installation in the
  Premises or to make suffer or permit to be made any alterations or additions
  to the electrical wiring installation air-conditioning plant or ducting (if
  any) and lighting fixtures or any part thereof or other Landlords fixtures
  nor without the like consent to install or permit or suffer to be installed
  any plant equipment apparatus or machinery including any safe or other object
  which imposes a weight on any part of the flooring in excess of that for
  which it was designed. The Landlord shall be entitled to prescribe the
  maximum weight and permitted location of safes and other heavy equipment and
  to require that the same stand on supports of such  16 
   dimensions
  and material to distribute the weight as the Landlord may deem necessary. All
  reasonable and proper fees incurred by the Landlord in obtaining the approval
  of its architects to the location of heavy objects shall be borne by the
  Tenant and payment therefor may be imposed as a pre-requisite to the Tenant
  receiving such consent;(b)
  
  Not
  to install any air-conditioning plant or equipment of any kind on or within
  or at any part of the Premises without the prior consent of the Landlord in
  writing AND the Tenant shall comply with the directions and instructions of
  the Landlord regarding installation and shall at its own expense be
  responsible for their periodic inspection maintenance and repair and for the
  replacement of defective wiring and the Tenant shall be strictly liable for
  any damage caused by the installation operation defect or removal of such
  units;(c)
  
  Not
  to make or permit or suffer to be made any alterations in or additions to the
  mechanical or electrical installations in the Building nor to install or
  permit or suffer to be installed any equipment, apparatus or machinery which
  exceeds the loading of the electrical installations in the Building nor to
  install or permit or suffer to be installed any equipment, apparatus or
  machinery which exceeds the loading of the electrical main or wiring or which
  consumes electricity not metered through the Tenants separate meter;(d)
  
  Not
  to make or permit or suffer to be made any alterations to any installation or
  fixture so as to affect or be likely to affect the supply of water,
  electricity or other utility or service to or in the Building;(e)
  
  In
  carrying out any approved work hereunder the Tenant its servants agents
  contractors and workmen shall obey and  17 
   comply
  with all reasonable instructions and directions which may be given by the
  Landlord, its Project Manager or other authorised representatives in
  connection with the carrying out of such work;(f)
  
  Any
  fees or expenses incurred by the Landlord in connection with the giving of
  consents hereunder shall be borne by the Tenant;Injury
  to Main Walls
  
  5.02
  
  
  
  Not
  without the previous written consent of the Landlord to cut maim or injure or
  permit or suffer to be cut maimed or injured any doors windows walls beams
  structural members or other part of the fabric of the Premises;Alterations
  to Exterior
  
  5.03
  
  
  
  Not
  to affix anything or paint or make any alteration whatsoever to the exterior
  of the Premises save as provided in Section V Clause 5.07 hereof;Obstructions
  to Outside Windows
  
  5.04
  
  
  
  Not
  to block up darken or obstruct or obscure any shop front window or any other
  window or lights belonging to the Premises without having obtained the
  express written consent of the Landlord which consent may be given subject to
  such conditions as the Landlord may in its absolute discretion consider fit
  to impose;Not
  to erect gates or grilles
  
  5.05
  
  
  
  Not
  without the prior written consent of the Landlord to erect or install doors,
  gates, metal grilles, shutters or other similar installation whatsoever
  whether temporary or permanent at the doorway or entrance to the Premises or
  at any of the fire exits therefrom or erect any such doors or metal grille or
  shutter or gate that might in any way contravene the regulations from time to
  time in force of the Fire Services Department or other competent authority
  concerned, nor in any other respect to contravene the said regulations;  18 
   Noise
  
  5.06
  
  
  
  Not
  to cause or produce or suffer or permit to be produced on or in the Premises
  any sound or noise (including sound produced by broadcasting from
  Rediffusion, Television, Radio and any apparatus or instrument capable of
  producing or reproducing music and sound) or any vibration or resonance or
  other form of disturbance or other acts or things in or on the Premises which
  is or are or may be a nuisance to the tenants or occupiers of adjacent or
  neighbouring premises or to users and customers of the same or to the Landlord
  and in the event of the Tenants permitted business use of the Premises as
  defined in Part VII of the Schedule hereto requiring any sound or noise
  to be produced or reproduced within the Premises or any part thereof to
  install and maintain to the satisfaction of the Landlord appropriate and
  adequate sound absorbing and insulating material so as to prevent such sound
  or noise from escaping from the Premises and from becoming a nuisance or
  annoyance to other tenants or occupiers of the Building or any part thereof
  or any adjoining or adjacent premises.Signs
  
  5.07
  
  
  
  Save
  as permitted pursuant to Clause 3.22 hereof not to exhibit or display on or
  affix to the exterior of the Premises or on the interior face of the curtain
  wall and window of the Premises any writing sign signboard or other device
  whether illuminated or not nor to affix any writing sign signboard or other
  device in at or above any common area lobby landing or corridor of the
  Building.  Provided always that the
  Tenant shall be entitled to have its name and business displayed in lettering
  and/or characters to a design and standard of workmanship approved by the
  landlord (which approval shall not be unreasonably withheld) on a signboard
  upon the front of the Premises.  19 
   If
  the Tenant carries on business under a name other than its own name it shall
  be entitled to have that name displayed aforesaid but the Tenant shall not be
  entitled to change the business name without the previous written consent of
  the Landlord (which consent shall not be unreasonably withheld) and without
  prejudice to the foregoing the Landlord may in connection with any
  application for consent under this clause require the Tenant to produce such
  evidence as it shall think fit to show that no breach of Section V
  Clause 5.21 hereof has taken place or is about to take place;Auction
  & Sales
  
  5.08
  
  
  
  Not
  to conduct or permit any auction fire bankruptcy close-out or similar sale of
  things or properties of any kind to take place on the Premises Provided that
  this provision shall not preclude the conduct of genuine periodic seasonal or
  promotional sales where the permitted user of the Premises includes shop or
  retail uses;Illegal
  Immoral or Improper Use
  
  5.09
  
  
  
  Not
  to use or cause permit or suffer to be used any part of the Premises for
  gambling or for any illegal immoral or improper purposes or in any way so as
  to cause nuisance or annoyance inconvenience or damage or danger to the
  Landlord or the tenants or occupiers of adjacent or neighbouring Premises;No
  Touting
  
  5.10
  
  
  
  Not
  to tout or solicit or procure or permit any touting or soliciting for
  business or the distribution of any pamphlets notices or advertising matter
  outside the Premises or anywhere within the Building by any of the Tenants
  servants agents or licensees;Sleeping
  or Domestic Use
  
  5.11
  
  
  
  Not
  to use the Premises or any part thereof as sleeping quarters or as domestic
  premises within the meaning of any ordinance for the time being in force or
  to allow any person to remain on the Premises  20 
   overnight
  unless with the Landlords prior permission in writing;Storage
  of dangerous goods
  
  5.12
  
  
  
  Not
  to keep or store or cause or permit or suffer to be kept or stored any extra
  hazardous or dangerous goods within the meaning of the Dangerous Goods
  Ordinance and the regulations thereunder or any Statutory modification or
  re-enactment thereof;User
  
  5.13
  
  
  
  Not
  to use the Premises for any purpose other than the purpose specified in Part
  VII of the Schedule hereto;Obstructions
  in Passages
  
  5.14
  
  
  
  Not
  to place or leave or suffer or permit to be placed or left by any contractor
  employee invitee or licensee of the Tenant any boxes furniture articles or
  rubbish in the entrances or any of the staircases passages or landings of the
  Building used in common with other tenants or the Landlord or otherwise
  encumber the same;Parking
  & Loading
  
  5.15
  
  
  
  Not
  to park in obstruct or otherwise use nor permit to be parked in obstructed or
  otherwise used by any employee agent or licensee of the Tenant those areas of
  the Building allocated to parking the movement of or access for vehicles or
  designated as loading/unloading areas other than in accordance with the
  Regulations made from time to time by the Landlord;Goods
  & Merchandise Outside the Premises
  
  5.16
  
  
  
  Not
  to place expose or leave or permit to be placed exposed or left for display
  sale or otherwise any goods or merchandise whatsoever upon or over the ground
  outside the Premises;Free
  Standing Signs
  
  5.17
  
  
  
  Not
  to place expose or leave or permit to be placed exposed or left any free
  standing signs upon or over the ground outside the Premises or in any of the
  staircases passages or landings of the Building used in common with other
  Tenants or the Landlord;  21 
   Preparation
  of Food & Prevention of Odours
  
  5.18
  
  
  
  Not
  to cause or permit any offensive or unusual odours arising out of the
  preparation of food upon the Premises (if so permitted under the terms of
  Part VII of the Schedule) to emanate from the Premises so as to cause in the
  Landlords opinion a nuisance to other occupiers or users of the Building;Food
  by Serviceways
  
  5.19
  
  
  
  Not
  to permit or allow any food stuffs or food containers to be brought onto or
  removed from the Premises except by way of service entrances service exits
  and (if any) service lifts or otherwise as may be directed by the Landlord
  from time to time;Animals,
  Pets & Infestation
  
  5.20
  
  
  
  Not
  to keep or permit or suffer to be kept any pets animals or livestock inside
  the Premises and to take all such reasonable steps and precautions to the satisfaction
  of the Landlord as shall be necessary to prevent the Premises or any part
  thereof from becoming infested by termites rats mice roaches or any other
  pests or vermin and for the better observance hereof the Landlord may require
  the Tenant at the Tenants cost to employ such pest extermination contractors
  as the Landlord may nominate and at such intervals as the Landlord may
  direct;Alienation
  
  5.21
  
  
  
  Not
  to assign underlet or otherwise part with the possession of the Premises or
  any part thereof in any way whether by way of subletting lending sharing or
  other means whereby any person or persons not a party to this Agreement
  obtains the use or possession of the Premises or any part thereof
  irrespective of whether any rental or other consideration is given for such
  use or possession and in the event of any such transfer sub-letting sharing
  assignment or parting with the possession of the Premises (whether for
  monetary consideration or not) this Agreement shall absolutely determine  22 
   and
  the Tenant shall forthwith vacate the Premises on notice to that effect from
  the Landlord. The Tenancy shall be personal to the Tenant named in the
  Schedule to this Agreement and without in any way limiting the
  generality of the foregoing the following acts and events shall unless
  approved in writing by the Landlord be deemed to be breaches of this clause
  :-(i)
  
  In
  the case of a tenant which is a partnership the taking in of one or more new
  partners whether on the death or retirement of an existing partner or
  otherwise;(ii)
  
  In
  the case of a tenant who is an individual (including a sole surviving partner
  of a partnership tenant) the death insanity or disability of that individual
  to the intent that no right to use possess occupy or enjoy the Premises or
  any part thereof shall vest in the executors administrators personal
  representatives next of kin trustee or committee of any such individual;(iii)
  
  In
  the case of a tenant which is a corporation any take-over reconstruction
  amalgamation merger voluntary liquidation or change in the person or persons
  who owns or own a majority of its voting shares or who otherwise has or have
  effective control thereof;(iv)
  
  The
  giving by the Tenant of a Power of Attorney or similar authority whereby the
  donee of the Power obtains the right to use possess occupy or enjoy the
  Premises or any part thereof or does in fact use possess occupy or enjoy the
  same;  23 
   (v)
  
  The
  change of the Tenants business name without the previous written consent of
  the Landlord which consent the Landlord may give or withhold at its
  discretion;Breach
  of Government Lease
  
  5.22
  
  
  
  Not
  to cause suffer or permit any contravention of the negative or restrictive
  provisions of the Government Lease or Conditions of Grant under which the
  Landlord holds the Premises or any Deed of Mutual Covenant or any Sub-Deed of
  Mutual Covenant affecting the Building and to indemnify the Landlord against
  any such breach;Breach
  of Insurance Policy
  
  5.23
  
  
  
  Not
  to cause or suffer or permit to be done any act or thing whereby the policy
  or policies of insurance on the Premises against damage by fire or liability
  to Third Parties for the time being subsisting may become void or voidable or
  whereby the rate of premium or premiums thereon may be increased, and to
  repay to the Landlord on demand all sums paid by the Landlord by way of increased
  premium or premiums thereon and all expenses incurred by the Landlord in and
  about any renewal of such policy or policies arising from or rendered
  necessary by a breach of this Clause;Prohibited
  Names
  
  5.24
  
  
  
  Not
  without the previous written consent of the Landlord to name or include in
  the name of the business or company operated by the Tenant the name of the
  Building or any name similar thereto and not at any time to change the name
  of the business or company to include any such name as aforesaid.Locks
  
  5.25
  
  
  
  Not
  without the previous written consent of the Landlord (such consent not to be
  unreasonably withheld) to alter the existing locks, bolts and fittings on the
  entrance doors to the Premises nor to install any additional locks, bolts or
  fittings thereon.  24 
   Tenants
  Association
  
  5.26
  
  
  
  Not
  to form or organise or attempt or make any effort to form or organise any
  tenants association or union jointly with any tenants of the Building for
  whatever objects or purposes during the continuance of the tenancy.Overload
  
  5.27
  
  
  
  Not
  to place on any part of floors of the Premises any article, machinery, goods
  or merchandise which may cause the maximum floor loading-bearing capacity
  thereof to be exceeded.SECTION VI
  EXCLUSIONS6.IT IS HEREBY FURTHER EXPRESSLY AGREED AND
  DECLARED that the Landlord shall not in any circumstances be liable to the
  Tenant or any other person whomsoever :-Breakdown
  of Lifts, Air-Conditioning, Utilities
  
  6.01
  
  (i)
  
  In
  respect of any loss of profit or of business or loss of life or loss, injury
  or damage to person or property or for any disruption or inconvenience caused
  to or suffered or sustained by the Tenant or any other person caused by or
  through or in any way owing to or arising out of or connected with any defect
  in or breakdown or suspension of service of the lifts air-conditioning
  system, electric power or water supplies, or any other building service provided
  in or serving the Building, orFire
  and overflow of water
  
  
  
  (ii)
  
  In
  respect of any loss of profit or of business or loss of life or loss injury
  or damage to person or property or for any disruption or inconvenience caused
  to or suffered or sustained by the Tenant or any other person caused by or
  through or in any way owing to or arising out of or connected with any escape
  of fumes smoke fire or any  25 
   other
  substance or thing or the overflow of water from anywhere within the
  Building, orSecurity
  
  
  
  (iii)
  
  For
  the security or safekeeping of the Premises or any contents therein and in
  particular but without prejudice to the generality of the foregoing the
  provision by the Landlord of watchmen and caretakers or any mechanical or
  electrical systems of alarm of whatever nature shall not create any
  obligation on the part of the Landlord as to the security of the Premises or
  any contents therein and the responsibility for the safety of the Premises
  and the contents thereof shall at all times rest with the Tenant,nor
  shall the rent hereinbefore mentioned or other charges payable hereunder or
  any part thereof abate or cease to be payable on account of any of the
  foregoing.SECTION VII
  ABATEMENT OF RENTSuspension
  of Rent in case of Fire
  
  7.01
  
  
  
  If
  the Premises or the Building or any part thereof shall at any time during the
  tenancy be destroyed or damaged or become inaccessible owing to fire water
  storm typhoon defective construction white ants earthquake subsidence of the
  ground or any calamity beyond the control of the Landlord so as to render the
  Premises unfit for commercial use or inaccessible and the policy or policies
  of insurance effected by the Landlord shall not have been vitiated or payment
  of policy monies refused in whole or in part in consequence of any act or
  default of the Tenant or if at any time during the continuance of this
  Tenancy the Premises or the Building shall be condemned as a dangerous
  structure or a demolition order or closing order shall  26 
   become
  operative in respect of the Premises or the Building then the rent hereby
  reserved or a fair proportion thereof according to the nature and extent of
  the damage sustained or order made shall be suspended until the Premises or
  the Building shall again be rendered accessible and fit for commercial use
  Provided that should the Premises or the Building not have been reinstated in
  the meantime either the Landlord or the Tenant may at any time after six
  months from the occurrence of such damage or destruction or order give to the
  other of them notice in writing to determine this present tenancy and
  thereupon the same and everything herein contained shall cease and be void as
  from the date of the occurrence of such destruction or damage or order or of
  the Premises becoming inaccessible or unfit for commercial use but without
  prejudice to the rights and remedies of either party against the other in
  respect of any antecedent claim or breach of the agreements stipulations
  terms and conditions herein contained or of the Landlord in respect of the
  rent payable hereunder prior to the coming into effect of the suspension.SECTION VIII
  DEFAULT8.
  
  
  
  It
  is hereby expressly agreed and declared as follows :-Default
  
  8.01
  
  
  
  If
  the Rent and/or the management fee and/or the central chilled water charges
  and/or any other sums payable hereunder or any part thereof shall be in
  arrear for fifteen (15) days after the same shall become payable (whether
  formally demanded or not) or if there shall be any breach or non-performance
  of any of the stipulations conditions or agreements herein contained  27 
   and
  on the part of the Tenant to be observed or performed which the Tenant shall
  fail to rectify or take all necessary steps towards rectification within a
  period of 15 days of being advised in writing of the breach or if the Tenant
  shall stop or suspend payment of its debts or be unable to or admit inability
  to pay its debts as they fall due or enter into any scheme of arrangements
  with its creditors or have any encumbrancer take possession of any of its
  assets in circumstances in which the Landlord shall have reasonable grounds
  for believing that the ability of the Tenant to pay the rentals and other
  charges hereby reserved and to observe and perform its obligations under this
  Agreement shall have been prejudiced or put at risk or have a receiving order
  made against it or in such circumstances as aforesaid fail to satisfy any
  judgment that may be given in any action against it after final appeal or if
  the Tenant shall become bankrupt or being a corporation go into liquidation
  (save for the purposes of amalgamation or reconstruction) or if the Tenant,
  shall suffer any execution to be levied upon the Premises or otherwise on the
  Tenants goods or if in such circumstances as aforesaid the Tenant shall
  suspend or cease or threaten to suspend or cease to carry on its business or
  should any event occur or proceedings be taken with respect to the Tenant in
  any jurisdiction to which the Tenant is subject which has an effect
  equivalent or similar to any of the events or circumstances described above
  then and in any such case it shall be lawful for the Landlord at any time
  thereafter to re-enter on and upon the Premises or any part thereof in the
  name of the whole and thereupon this Agreement shall absolutely determine but
  without prejudice to any right or action by the Landlord in respect of any
  outstanding breach or non-observance or non-performance by the Tenant of any
  of the terms of this Agreement.  A
  written  28 
   notice
  served by the Landlord on the Tenant in manner hereinafter provided to the
  effect that the Landlord thereby exercises the power of determination and/or
  re-entry hereinbefore contained shall be a full and sufficient exercise of
  such power without physical entry on the part of the Landlord notwithstanding
  any statutory or common law provision to the contrary.  All costs and expenses including any legal
  costs and fees incurred by the Landlord in demanding payment of the rent and
  other charges aforesaid (if the Landlord elects to demand) or the extent of
  any loss to the Landlord arising out of this Clause shall be paid by the
  Tenant and shall be recoverable from the Tenant as a debt or be deductable by
  the Landlord from any deposit held by the Landlord hereunder;Interest
  
  8.02
  
  
  
  Notwithstanding
  anything herein contained in the event of default in payment of rent or other
  monies payable by the Tenant hereunder for a period of 14 days from the date
  when payment is due (whether formally demanded or not) the Tenant shall pay to
  the Landlord on demand daily interest on all such sums outstanding at the
  rate of 1.5% per calendar month calculated from the date on which the same
  shall be due for payment (in accordance with the provisions contained in that
  behalf herein) until the date of payment as liquidated damages and not as
  penalty provided that the demand and/or receipt by the Landlord of interest
  pursuant to this Clause shall be without prejudice to and shall not affect
  the right of the Landlord to exercise any other right or remedy hereof
  (including but without prejudice to the generality of the foregoing the right
  of re-entry) exercisable under the terms of this Agreement;Acceptance
  of Rent
  
  8.03
  
  
  
  The
  acceptance of any rent by the Landlord hereunder shall not be deemed to
  operate as a waiver by the Landlord of any right to  29 
   proceed
  against the Tenant in respect of any breach non-observance or non-performance
  by the Tenant of any of the agreements stipulations terms and conditions
  herein contained and on the part of the Tenant to be observed and performed;Acts
  of Employees Invitees & Licensees
  
  8.04
  
  
  
  For
  the purpose of these presents any act default neglect or omission of any
  guest, visitor, servant, contractor, employee, agent, invitee or licensee of
  the Tenant shall be deemed to be act default neglect or omission of the
  Tenant;Distraint
  
  8.05
  
  
  
  For
  the purpose of Part III of the Landlord and Tenant (Consolidation) Ordinance
  (Chapter 7) and of this Agreement, the Rent payable in respect of the
  Premises shall be and be deemed to be in arrear if not paid in advance at the
  times and in the manner hereinbefore provided for payment thereof.Disconnection
  of Air-conditioning Chilled Water Etc.
  
  8.06
  
  
  
  In
  addition and without prejudice to the Landlords rights under Clauses 8.01
  and 8.02 hereof, the Landlord shall be entitled, and the Tenant hereby
  specifically authorises the Landlord, in the event of any breach or default
  by the Tenant of or in the performance of any of the terms and conditions of
  this Agreement, cut off or otherwise disconnect the supply of water,
  electricity and air-conditioning chilled water or any of them to the Premises
  and in the event that the Tenant shall have deserted, abandoned or no longer
  be occupying the Premises or on the expiration or sooner determination of the
  Term to dispose of all objects including goods merchandise equipment
  furniture and fixtures in or at the Premises in such manner as the Landlord shall
  deem fit, and any expenses in connection therewith shall be paid by the
  Tenant and shall be recoverable from it as a debt. The Landlord shall incur
  no liability whatsoever to the Tenant in respect of anything done or omitted
  to be done in  30 
   pursuance
  or purported pursuance of this Clause and the Tenant shall indemnify and keep
  the Landlord fully indemnified against all actions, proceedings, claims,
  costs and expenses in respect of anything done or omitted to be done by the
  Landlord in pursuance or purported pursuance of this Clause.SECTION IX
  DEPOSITDeposit
  
  9.01
  
  
  
  The
  Tenant shall on the signing hereof deposit with the Landlord the sum or sums
  specified in Part VI of the Schedule hereto (being the equivalent of
  three months rent and management fee and central chilled water charges at
  the rates payable therefor at the commencement of the Term) to secure the due
  observance and performance by the Tenant of the agreements stipulations terms
  and conditions herein contained and on the part of the Tenant to be observed
  and performed which said deposit shall be held by the Landlord throughout the
  currency of this Agreement free of any interest to the Tenant with the right
  for the Landlord (without prejudice to any other right or remedy hereunder)
  to deduct therefrom the amount of any Rent rates and other charges payable
  hereunder and any costs expenses loss or damage sustained by the Landlord as
  the result of any non-observance or non-performance by the Tenant of any of
  the said agreements stipulations obligations or conditions. In the event of
  any deduction being made by the Landlord from the said deposit in accordance
  herewith during the currency of this Agreement the Tenant shall forthwith on
  demand by the Landlord make a further deposit equal to the amount so deducted
  and failure by the Tenant so to do shall entitle the Landlord forthwith to
  re-enter upon the  31 
   Premises
  and to determine this Agreement as hereinbefore provided.Increase
  in Deposit
  
  9.02
  
  
  
  The
  amount of the deposit shall be increased following each and any increase in
  rent or the management fee and central chilled water charges provided for
  herein to a sum equal to three (3) months rent and management fee and
  central chilled water charges at the rates payable therefor at the date or
  dates of such increase becoming effective, and the Tenant shall make payment
  accordingly and the provisions of this Section IX shall apply to such
  further deposits.Repayment
  of Deposit
  
  9.03
  
  
  
  Subject
  as aforesaid the said deposit and any further deposits paid shall be refunded
  to the Tenant by the Landlord without interest within a reasonable period of
  time after the expiration or sooner determination of this Agreement and
  delivery of vacant possession to the Landlord and after settlement of the
  last outstanding claim by the Landlord against the Tenant for any arrears of
  Rent rates and other charges and for any breach non-observance or
  non-performance of any of the agreements stipulations terms and conditions
  herein contained and on the part of the Tenant to be observed or performed
  whichever shall be the later.SECTION X
  REGULATIONSIntroduction
  of Regulations
  
  10.01
  
  
  
  The
  Landlord shall be entitled from time to time and by notice in writing to the
  Tenant to make introduce and subsequently amend adopt or abolish if necessary
  such Regulations as it may consider necessary for the proper operation and
  maintenance of the Building.  32 
   Conflict
  
  10.02
  
  
  
  Such
  Regulations shall be supplementary to the terms and conditions contained in
  this Agreement and shall not in any way derogate from such terms and
  conditions. In the event of conflict between such Regulations and the terms
  and conditions of this Agreement the terms and conditions of this Agreement
  shall prevail.Exclusion
  of Liability
  
  10.03
  
  
  
  The
  Landlord shall not be liable for any loss or damage howsoever caused arising
  from any non-enforcement of the Regulations or non-observance thereof by any
  third party.SECTION XI
  INTERPRETATION AND MISCELLANEOUSName
  of Building
  
  11.01
  
  
  
  The
  Landlord reserves the right to name the Building with any such name or style
  as it in its sole discretion may determine and at any time and from time to
  time to change alter substitute or abandon any such name without thereby
  becoming liable to compensate the Tenant for any loss expense or
  inconvenience caused to the Tenant as a consequence thereof provided that the
  Landlord shall give the Tenant and the Postal and other relevant Government
  Authorities not less than three months notice of its intention so to do.Alterations
  to the Building
  
  11.02
  
  
  
  The
  Landlord reserves the right from time to time to improve extend add to or
  reduce the Building or in any manner whatsoever alter or deal with the
  Building (other than the Premises) Provided always that in exercising such
  right the Landlord will endeavour to cause as little inconvenience to the
  Tenant as is practicable in the circumstances and make good any damage caused
  to the Premises within a reasonable period of time.  33 
   Functions
  & Display
  
  11.03
  
  
  
  Notwithstanding
  anything herein contained or implied to the contrary the Landlord may permit
  any person or organization to hold any functions or exhibition or display any
  merchandise in any part or parts of the common areas of the Building at such
  times and upon such terms and conditions as the Landlord may in its absolute
  discretion think fit.Public
  Address System
  
  11.04
  
  
  
  Notwithstanding
  anything herein contained or implied to the contrary the Landlord may provide
  and install a public address system throughout the common areas of the
  Building and may play relay or broadcast or permit any other person to play
  relay or broadcast recorded music or public announcements thereon.Condonation
  Not A Waiver
  
  11.05
  
  
  
  No
  condoning excusing or overlooking by the Landlord of any default breach or
  non-observance or non-performance by the Tenant at any time or times of any
  of the agreements stipulations terms and conditions herein contained shall
  operate as a waiver of the Landlords right hereunder in respect of any
  continuing or subsequent default breach or non-observance or non- performance
  or so as to defeat or affect in any way the rights and remedies of the
  Landlord hereunder in respect of any such continuing or subsequent default or
  breach and no waiver by the Landlord shall be inferred from or implied by
  anything done or omitted by the Landlord, unless expressed in writing and
  signed by the Landlord. Any consent given by the Landlord shall operate as a
  consent only for the particular matter to which it relates and shall in no
  way be considered as a waiver or release of any of the provisions hereof nor
  shall it be construed as dispensing with the necessity of obtaining the
  specific written consent of the Landlord in the future, unless expressly so
  provided.  34 
   Letting
  Notices & Entry
  
  11.06
  
  
  
  During
  the three months immediately before the expiration or sooner determination of
  the said Term of tenancy the Tenant shall permit all persons having written
  authority to enter and view the Premises and every part thereof at all
  reasonable times PROVIDED FURTHER that the Landlord shall be at liberty to
  affix and maintain without interference upon any external part of the
  Premises a notice stating that the Premises are to be let and such other
  information in connection therewith as the Landlord shall reasonably require
  during the aforementioned period of 3 months.Service
  of Notice
  
  11.07
  
  
  
  Any
  notice required to be served on the Tenant shall be sufficiently served if
  delivered to or despatched by registered post or left at the Premises or at
  the last known address of the Tenant. Any notice required to be served on the
  Landlord shall be sufficiently served if delivered or despatched by
  registered post to its registered office from time to time. A notice sent by
  registered post shall be deemed to be given at the time and date of posting.Gender
  
  11.08
  
  
  
  In
  this Agreement if the context otherwise permits or requires words importing
  the singular number shall include the plural number and vice versa and words
  importing the masculine feminine or neuter gender shall include the other of
  them and references to persons shall include bodies corporate or
  unincorporate.Marginal
  Notes, Headings & Index
  
  11.09
  
  
  
  The
  Marginal Notes Headings and index are intended for guidance only and do not
  form part of this Agreement nor shall any of the provisions of this Agreement
  be construed or interpreted by reference thereto or in any way affected or
  limited thereby.  35 
   Stamp
  Duty & Costs
  
  11.10
  
  
  
  The
  legal costs of and incidental to the preparation execution and completion of
  this Agreement shall be borne by the Landlord and the Tenant in the manner
  stipulated in Part VIII of the Schedule hereto.  The stamp duty and registration fee (if
  any) on this Agreement shall be borne by the parties hereto in equal shares.Deed
  of Mutual Covenant and Management Agreement
  
  11.11
  
  
  
  The
  Tenant shall observe and comply with and perform all the covenants terms and
  provisions in the Deed of Mutual Covenant or Sub-Deed of Mutual Covenant or
  Management Agreement (if any) relating to the Building so far as they relate
  to the Premises and shall indemnify the Landlord against the breach
  non-observance or non- performance thereof.In
  the event that under any such Deed of Mutual Covenant or Sub-Deed of Mutual
  Covenant or Management Agreement the supply of chilled water and/or the operation
  and/or the management of the Building or the right, power or duty thereto
  shall be controlled by or vested in a manager the Tenant shall pay all
  air-conditioning and service charge and all management and maintenance
  charges relating to the Premises as may be payable under such Deed of Mutual
  Covenant or Sub-Deed of Mutual Covenant or Management Agreement.No
  Fine
  
  11.12
  
  
  
  The
  Tenant acknowledges that no fine premium key money construction money or
  other consideration has been paid or will be payable by the Tenant to the
  Landlord for the grant of this tenancy.Exclusion
  of Warranties
  
  11.13
  
  
  
  This
  Agreement sets out the full the agreement reached between the parties and no
  other representations have been made or warranties given relating to the
  Building or the Premises.  36 
   Joint
  & Several Liability
  
  11.14
  
  
  
  Where
  more than one person is included in the expression the Tenant all such
  persons shall be jointly and severally liable for the performance and
  observance of the terms, conditions and agreements contained herein and on
  the part of the Tenant to be performed and observed.Special
  Conditions
  
  11.15
  
  
  
  The
  parties hereto further agree that they shall respectively be bound by and
  entitled to the benefit of the Special Conditions set out in Part IX of the
  Schedule hereto.  AS
WITNESS the hands of the parties hereto the day and year first above written.  37 
   THE SCHEDULE ABOVE
REFERRED TO  PART I  The
  Landlord
  
  :
  
  JUGADA
  COMPANY LIMITED whose registered office is situate at 45th Floor, Sun Hung
  Kai Centre, 30 Harbour Road, Hong Kong.The
  Tenant
  
  :
  
  VALENCE
  TECHNOLOGY LIMITED ( [ILLEGIBLE) whose registered office is situate at Unit
  213-5 &8, Tech Center, 72 Tat Chee Avenue, Kowloon Tong, Hong Kong.  PART II  The Premises  All
Those WORKSHOP NOS.01-07 on the TWENTIETH FLOOR of APEC PLAZA, No. 49 Hoi Yuen
Road, Kwun Tong, Kowloon erected on All That piece or parcel of land registered
in the Land Registry as Kwun Tong Inland Lot No.731 which said Workshop is for
the purpose of identification only more particularly shown on the plan attached
hereto and thereon delineated and coloured Pink.  PART III  The Term  A
term of Three (3) years commencing on the 16th day of November 2003 and
expiring on the 15th day of November 2006.  PART IV  The Calendar Monthly Rent  HONG
KONG DOLLARS FORTY THREE THOUSAND FOUR HUNDRED AND THIRTY THREE ONLY
(HK$43,433.00) payable in advance on the first day of each and every calendar
month clear of all deductions exclusive of rates, management fee and central
chilled water charges.  38 
   PART V  The Management Fee
and the Central Chilled Water Charges  HONG
KONG DOLLARS TWENTY THOUSAND THREE HUNDRED AND EIGHTY AND CENTS TEN ONLY
(HK$20,380.10) per calendar month, payable monthly in advance on the first day
of each and every calendar month.  PART VI  The Deposit  HONG
KONG DOLLARS ONE HUNDRED NINETY ONE THOUSAND FOUR HUNDRED THIRTY NINE AND CENTS
THIRTY ONLY (HK$191,439.30) being the equivalent of three (3) calendar months
rent, management fee and central chilled water charges.  PART VII  User  Restricted
to use for industrial use under the trading name of Valence Technology
Limited provided that the Tenant shall obtain all necessary licences and
approval required by any Government Authority in connection with such use and
provided that the Landlord does not warrant that the Premises are fit to be used
for such purpose or any particular purpose.  PART VIII  Legal Costs  The
legal costs of and incidental to the preparation execution and completion of
this Agreement shall be borne by the Landlord and the Tenant in equal shares.  39 
   PART IX  Special Conditions  1.Rent free period  Notwithstanding anything to the contrary contained in this Agreement,
the Tenant shall be entitled to occupy the Premises for the following period :  (i)from 16th November 2003 to 15th
January 2004 (both dates inclusive),  (ii)from 16th November 2004 to 15th
January 2005 (both dates inclusive); 
and  (iii)from 16th November 2005 to 15th
December 2005 (both dates inclusive)  free of rent provided that during the said rent free period the Tenant
shall pay all rates, management fee and central chilled water charges and other
outgoings payable in respect of the Premises.  2.The Landlord reserves its right of free and
uninterrupted passage egress from and ingress to the common services of the
Building in or under above or through the Premises.  In particular, but without affecting the generality of the
aforesaid, the Landlord shall have the right to install, affix, erect or permit
to be installed, affixed or erected any aerial, transmitter or other
telecommunication cable wiring or equipment on or above the false ceiling or
otherwise over or under the Premises and the Tenant shall permit the Landlord
or its authorized agent or contractor to enter the Premises to install affix
erect maintain or repair such aerial transmitter cable wiring or equipment at
all reasonable time upon prior appointment and shall not remove, alter or
otherwise cause damage to such aerial transmitter cable wiring or equipment at
the Premises and shall indemnify the Landlord against all claims demands
actions proceeding loss or damages costs and expenses arising from the breach
of this provision by the Tenant.  40 
   SIGNED by
  Wong
  Chin Wah
  ))
  For
  and on behalf of)
  JUGADA    COMPANY   LIMITED)for
  and on behalf of Jugada Company
  )
  /s/Wong Chin Wah)
  Authorised Signature(s)Limited
  whose signature is verified by:-
  )   /s/Majestic Sin YeungMajestic
  Sin YeungJohnson
  Stokes & Master
  Solicitor, Hong Kong SAR   SIGNED by
  CHOI
  Yat Ming
  )
  For and on behalf of)
  VALENCE
  TECHNOLOGY LIMITED)
  [ILLEGIBLE])for
  and on behalf of the Tenant in the
  )
  /s/CHOI Yat Ming)
  Authorized
  Signature(s)presence
  of:-
  )/s/
  CHAM Tze Kwong ReivlinCHAM
  Tze Kwong ReivlinHKID
  No. E849223(2)  41 
   RECEIVED
  on or before the day and year first above
  ))written
  of and from the Tenant the above mentioned
  ))deposit
  of HONG KONG DOLLARS ONE
  )
  
  HK$191,439.30)HUNDRED
  NINETY ONE THOUSAND FOUR
  )For
  and on behalf ofHUNDRED
  AND THIRTY NINE AND CENTS
  
  JUGADA
  COMPANY LIMITEDTHIRTY
  ONLY.
  
  /s/
  Wong Chin WahAuthorised Signature(s)Signature
  verified by :-  /s/Majestic Sin YeungMajestic
  Sin YeungJohnson
  Stokes & Master
  Solicitor, Hong Kong SAR  42 
   APEC PLAZA     [SEAL]
  20th Floor Plan   Identification Only To
Scale  43