Shen (Luo)	1002469

Contract Registration Number:		

 

 

 

 

 

 

 

 

CONTRACT FOR LEASEOF PREMISES OF 

 

SHENZHEN MUNICIPALITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Printed by Shenzhen MunicipalityPlanning and State Land Resources Bureau

CONTRACT FOR LEASE OFPREMISES

Lessor (PartyA):	ShenzhenJiannian Travel Limited
Address:	3/F, Xian Dai Meng Xiang Cheng, Nan You Road, Nan Shan District,			ShenzhenMunicipality
Postal Code:

Agent:

Address:

Postal Code:

Lessee (Party B):	SBS Technologies, Inc. Foreign Holding Company
Address:	(1)	2400 Louisiana Blvd. NE, AFC Building 5, Suite 600,Albuquerque, 
			NM USA 87110
		(2)	Room  501-502, Cyber Times Tower B,Tianan Cyber Park,				Futian District,Shenzhen Municipality
Postal Code:

Business Licence or Identity Card Number:

Agent:

Address:

Postal Code:

In accordance with the Contract Law of the People's Republicof China, Urban Real Estate Administration Law of the People's Republic ofChina, Regulation on Lease of Premises of Shenzhen Special Economic Zone and itsimplementing rules, Party A and Party B have agreed to enter into thisContract.

	**Article 1**	Party A shall lease the premises located at	Room 501-502, Cyber Times Tower B, Tianan Cyber Park,	Futian     District,Shenzhen Municipality (hereinafter referred to as the "Leased Premises") toParty B for Party B's use. The total leased area of the Leased Premises is441.14	square meters, subject to the area recorded in the Real Estate RightCertificate. The total number of floors of the building is 8	.		 
	Right holder of the Leased Premises:	ShenzhenJiannian Travel Limited  Chen Jian						  ;Real Estate Right Certificate or name and number of other effective documentsevidencing its ownership:							;Legal usage of the Leased Premises:	Office		.
	**Article 2**	The rent of the Leased Premises shall be calculatedbased on the area of the premises at a rate of RMB	  85	 per square meter permonth. The total monthly rent is RMB 	37,496.9	.	
	**Article 3**	Party B shall pay the first instalment of rent in theamount of RMB     37,496.9	 prior to 5th April 2004		.
	**Article 4**	Party B shall pay the rent to Party A :-
	þ	prior to the5th	day of eachmonth;
	□	prior to the 	day of the 	month of eachquarter;

	□	prior to the 	day of the	month of everyhalf year;

	□	prior to the 	day of the	month of eachyear.				
**	Party A shall issue tax invoice to Party B upon receipt of therent.
	(Both Parties shall jointly choose any one of theaforesaid 4 means and put a "√" in the box chosen.)

	**Article 5**	The term of lease of the Leased Premises by Party Bshall commence on 10th May 2004		 and expire on 9th May 2006		.
	The term agreedabove shall not exceed the approved term of land use. Any part of the termexceeding the said term of land use shall have no effect. Any loss causedthereby shall be borne in accordance with the agreement of both Parties (if any)or by Party A in the absence of agreement between the Parties.
	**Article 6**	Party A shall lease the Leased Premises in accordancewith the legal usage.
	Party B shall usethe Leased Premises in accordance with the legal usage and shall not change thelegal usage without authorisation.
	Any change in thelegal usage of the Leased Premises by Party B shall be consented by Party A inwriting. Party B shall make an application with the competent real estateauthority for change in land usage in accordance with the relevant laws andregulations, and may only change the use of the Leased Premises to the approvedusage after approval is obtained.
	**Article 7**	Party A shall, prior to 	1st April2004		,deliver the Leased Premises to Party B for Party B's use and attend to therelevant handover procedures.  
	If Party Adelivers the Leased Premises after the aforesaid time, Party B may request for acorresponding postponement of the effective term of this Contract. Both Partiesshall confirm the same in writing by signing and shall file the document withthe contract registration authority for record.
	**Article 8**	Upon delivery of the Leased Premises, both Partiesshall confirm the current conditions of the Leased Premises and the appurtenantfacilities thereof, the appurtenant properties, and other relevant conditions,and shall be specified in the Schedule hereto.
	**Article 9**	Party A may, upon delivery of the Leased Premises,collect from Party B a lease deposit in an amount not exceeding 3 month'srental, i.e. RMB	74,993.8	.
	Party A shallissue invoice to Party B for the lease deposit received.
	The conditions forParty A to refund the deposit to Party B are as follows:-
	1.	Party B shall have performed the Lease Contractduring the term of the Contract									
	2.										
	3.										
	þ	Any one of the conditions isfulfilled.
	□	All the conditions are fulfilled.

	(Both Parties shall jointly choose one from the aforesaidtwo items, and shall put a  "√" in the box chosen.)

	Party A shall notrefund the deposit in the event of the occurrence of any of the followingcircumstances:-
	1.	Party B fails to perform the LeaseContract									
	2.										
	3.										
	**Article10	During theterm of the lease, Party A shall be responsible to pay the land use fee of theLeased Premises, and taxes, management fee for lease of premises and	―	 fee arising from the Leased Premises; Party B shall be responsible topay the water and electricity charges of the Leased Premises, hygiene charges,management fee of the building, 	―  fee and other fees incurred by the use of the Leased Premises.  
	**Article 11**	Party A shall ensure that the Leased Premises and theappurtenant facilities thereof delivered by it are fit for the purpose of thelease and shall warrant that the safety of the same complies with the relevantlaws, regulations and rules.
	If due to fault(intentional or otherwise) on the part of Party A, bodily harm is caused toParty B or loss is caused to the properties of Party B on the Leased Premises,Party B shall be entitled to claim for corresponding compensation from PartyA.
	**Article 12**	Party B shall use the Leased Premises and theappurtenant facilities thereof in a reasonable manner, and shall not use theLeased Premises to engage in illegal activities.  Party A shall not interferewith or impede the ordinary and reasonable use of the Leased Premises by PartyB.
	**Article 13**	In the course of use of the Leased Premises by PartyB, if any damage or malfunction of the Leased Premises or the appurtenantfacilities thereof impeding the safety and ordinary use of the same occurs, andthe occurrence of the same is not caused by fault on the part of Party B, PartyB shall promptly notify Party A and adopt all possible effective measures toprevent further enlargement of defect. Party A shall carry out repair workwithin        seven	 days from the receipt of the notice of Party B or shall authoriseParty B to carry out the repair work. If Party B is unable to notify Party A orif Party A fails to perform its obligation to repair within the aforesaid timelimit after the receipt of notice, Party B may carry out the repair work forParty A after reporting to the contract registration authority. 
	If immediaterepair work is necessary in emergency situations, Party B shall carry out therepair work for Party A and shall promptly notify Party A of the situation. 
	The cost andexpenses incurred by the repair work (including all reasonable expenses incurredby Party B in carrying out the repair work for Party A and in preventing theenlargement of defect) under any of the aforesaid two situations shall be borneby Party A. If Party B fails to perform its aforesaid obligations and fails topromptly notify Party A or adopt all possible effective measures, and therebycauses enlargement of defect, such part of the cost and expenses of repair work(attributable to the enlargement of defect) shall be borne by Party B.
	**Article14	In theevent of any improper or unreasonable use by Party B leading to the occurrenceof damage or malfunction of the Leased Premises or the appurtenant facilitiesthereof or any other situation impeding the safety of the same, Party B shallpromptly notify Party A and shall be responsible for repair work orcompensation. If Party B refuses to repair or compensate, Party A may, afterreporting to the contract registration authority, carry out the repair work forand at the expenses of Party B.
	**Article 15**	In the event of any remodelling of, improvement to, orrenovation of the Leased Premises by Party A or Party B during the effectiveterm of this Contract, Party A and Party B shall execute a separate agreement inwriting.
	In the event of the aforesaid situation, the remodelling,improvement or renovation work shall only be carried out after approval of therelevant authority is obtained (if such approval is necessary in accordance withthe regulations).

	**Article 16	**
	□	During the term of the lease, Party B may sub-lease the whole or any partof the Leased Premises to third parties and shall attend to the registrationprocedures with the competent authority for lease of real estate, provided thatthe term of the sub-lease shall not exceed the term of the lease hereunder.
	þ	Party B shall notsub-lease the whole or any part of the Leased Premises to any third party.However, during the term of the lease, Party B may, after obtaining the writtenconsent of Party A, sub-lease the whole or any part of the Leased Premises andattend to the registration procedures with the competent authority for lease ofreal estate by providing the authority with such documentary evidence ofconsent, provided that the term of the sub-lease shall not exceed the term ofthe lease hereunder.
	□	During the term of the lease, Party B shall not sub-lease the wholeor any part of the Leased Premises to any third party.
	(Both Parties shall choose any one of the aforesaid threeitems and put a "√" in the box chosen.)

	**Article 17**	During the effective term of this Contract, if Party Aintends to transfer the ownership of the whole or any part of the LeasedPremises, Party A shall notify Party B in writing one month prior to thetransfer. Party B shall have pre-emptive right to purchase the Leased Premisesprovided that the terms and conditions offered to it are no less favourable thanthose offered to other third parties.
	In the event of a transfer of the Leased Premises to anythird party, Party A shall have the responsibility to inform the transferee, atthe time of the execution of the transfer contract, to continue the performanceof this Contract. 

	**Article 18**	In the event of the occurrence of any of the followingcircumstances during the effective term of this Contract, this Contract may bedischarged or amended:-
	(1)	this Contract is incapable of being performed dueto force majeure;

	(2)	the Leased Premises are confiscated, acquired,recovered or demolished by the government;

	(3)	mutual agreement is reached by both Parties.

	**Article 19**	In the event of the occurrence of any of the followingcircumstances, Party A may, regarding the loss caused thereby,
	□	demand for damages from Party B;
	þ	forfeit the leasedeposit;
	□	demand Party B to pay a penalty for the default in the amount ofRMB 	     .
	(Both Parties shall make a choice among the aforesaidthree items and put a "√" in the corresponding box.) :-

   	(1)	Party B fails to pay rent for more than30	days(	onemonth);
	(2)	Party B fails to pay fees in the total amount ofmore than RMB 20,000	which may cause loss to Party A;
	(3)	Party B uses the Leased Premises to engage inillegal activities that are prejudicial to the public interest or third partyinterest;

	(4)	Party B changes the structure or the legal usageof the Leased Premises without authorisation;

	(5)	Party B, in violation of Article 14 herein, failsto bear the responsibility to repair or pay the cost and expenses for the repairwork, and thereby causes material damage to the premises or facilities;

	(6)	Party B renovates the Leased Premises without theconsent of Party A and approval of the relevant authority;

	(7)	Party B sub-leases the Leased Premises to thirdparties without authorisation.

	Apart from the right to claim for breach of contract ordamages against Party B, Party A may also discharge the Contract or request foran amendment of the terms of the Contract, in accordance with the aforesaidcircumstances. 

	**Article 20**	In the event of the occurrence of any of the followingcircumstances, Party B may, regarding the loss caused thereby,
	□	demand for damages from Party A;
	þ	demand Party A topay an amount equals to two times of the lease deposit;
	□	demand Party A to pay a penalty for the default in the amount ofRMB 	     .
	(Both Parties shall make a choice among the aforesaidthree items and put a "√" in the corresponding box.) :-

	(1)	Party A delays in delivering the Leased Premisesfor more than -30	days (-one       month);
	(2)	Party A breaches the 1st paragraph of Article 11herein, rendering the purpose of the lease by Party B incapable of beingachieved;

	(3)	Party A, in violation of Article 13 herein, failsto bear the responsibility to repair or pay the cost and expenses of the repairwork;

	(4)	Party A remodels, improves or renovates the LeasedPremises without the consent of Party B or approval of the relevant authority.

	Apart from the right to claim for breach of contract ordamages against Party A, Party B may also discharge the Contract (in this case,Party B shall, after receiving compensation, notify Party A in writing anddeliver the Leased Premises) or request for an amendment of the terms of theContract, in accordance with the aforesaid circumstances. 

	Party B shall not be liable to pay rent to Party A fromthe date of receipt of notice by Party A until the date of receipt ofcompensation by Party B.

	**Article 21**	After termination of this Contract, Party B shallleave and deliver the Leased Premises within 	three	days, warrantthat the Leased Premises and the appurtenant facilities are in good conditions(save and except for the ordinary wear and tear), pay all fees payable by PartyB and attend to the handover procedures.
	If Party B fails to leave or deliver the Leased Premiseswithin the time limit, Party A shall be entitled to recover the Leased Premisesand demand Party B to pay an amount equals to two times of the rent for theperiod of delay.

	**Article 22**	If Party B intends to continue to lease the LeasedPremises after expiration of the term of the lease hereunder, Party B shall makea demand for renewal of lease to Party A  two	months prior to theexpiration of the term of the lease. Party B shall have pre-emptive right tolease in the event of same terms and conditions.
	If Party A and Party B reach an agreement on renewal oflease, both Parties shall execute another contract and register the same withthe contract registration authority.

	**Article 23**	Party A and Party B shall observe all provisionsherein. If any Party commits a breach of the Contract, such Party shall bear thecorresponding responsibility in accordance with the provisions herein.
	**Article 24**	Matters not stipulated herein may be agreed by Party Aand Party B in the Schedule hereto. The Schedule hereto shall form an integralpart of this Contract and shall, after being executed by both Parties, have thesame force and effect as this Contract. 
	If Party A and Party B reach an agreement to amend theContract during the term of the lease, both Parties shall register suchagreement with the original contract registration authority. The registeredagreement shall have the same force and effect as this Contract.

	

	**Article 25**	In the event of any dispute arising from thisContract, Party A and Party B shall resolve the dispute through consultation,failing which, the Parties may submit the dispute to the contract registrationauthority for mediation. Failing such mediation, the Parties may:-
	þ	apply to ShenzhenArbitration Commission for arbitration;
	□	apply to China International Economic and Trade ArbitrationCommission, Shenzhen Commission for arbitration;
	□	bring a lawsuit in the People's Court.
	(Both Parties shall choose any one of the aforesaid waysof dispute resolution, and put a  "√" in the corresponding box.)

	**Article 26**	This Contract shall take effect upon execution.
	Party A and Party B shall register the Contract with thecompetent authority within 10 days from the date of execution of thisContract.

	**Article 27**	The Chinese version of this Contract shall be theauthentic version of this Contract.
	

	**Article 28**	This Contract shall be executed infourfive	counterparts. Party A shall retain one	counterpart. Party B shallretain  onetwo	counterparts. The contract registration authority shall retainone	counterpart. The relevant authority shall retain one	counterpart.  
 

Party A (sign & chop):

 

Legal Representative: Chen Jian

Tel:

Bank Account:

Agent (sign & chop):								Date:

 

Party B (sign & chop):

 

Legal Representative: Ryan Ge

Tel:

Bank Account:

Agent (sign & chop):								Date:

 

Registration Clerk (sign & chop):

 

Contract Registration Authority (sign &chop):				Date:

JSM draft: 31st March2004
**SUPPLEMENTAL AGREEMENT TO 

CONTRACT FOR LEASE OF PREMISES**
This Supplemental Agreement (hereinafter referred to as"**this Agreement**") is executed by the following Parties on [		] 2004in [place]:-

Lessor (Party A):	Shenzhen Jiannian Travel Limited

Lessee (Party B):	SBS Technologies, Inc. Foreign HoldingCompany

Please refer to the Main Contract for detailed information ofParty A and Party B.
**Preamble

Party A and Party B have executed the Contract forLease of Premises (hereinafter referred to as the "**Main Contract**") on[		] 2004, under which Party A shall lease the Leased Premises under theMain Contract (hereinafter referred to as the "**Premises**") to Party B forParty B's use. After sufficient consultation, both Parties have agreed toexecute this Agreement to amend and supplement the Main Contract. This Agreementand the Main Contract shall be collectively referred to as the "**LeaseContract**".
**Article 1	Title of the Premises**
	Party A warrants to Party B that Party A is the legal owner of thePremises and has the right to lease the Premises to Party B for Party B's use,and that the Premises are not subject to any kind of encumbrance. If Party A nolonger has the ownership of or right to lease the Premises during the term ofthe lease (regardless of the reason), and Party B is therefore unable to use thePremises in accordance with the Lease Contract, it shall be deemed as a breachof contract by Party A and Article 20 of the Main Contract shall apply.**Article 2	Use of the Premises**
	The legal usage of the Premises is [commercial, office]. Both Partiesagree and confirm that the purpose of leasing the Premises by Party B from PartyA is to provide office premises for the wholly foreign-owned enterprise (whichis a wholly-owned subsidiary of Party B, hereinafter referred to as the "**NewCompany**") to be established by Party B in Shenzhen Municipality inaccordance with the law. Therefore, after the New Company is incorporated inaccordance with the law, all rights and obligations under the Lease Contractshall be enjoyed and borne by the New Company and the New Company shall be thelessee under the Lease Contract replacing Party B. Party B shall no longer be aParty to the Lease Contract after being replaced by the New Company, and shallnot be liable to bear any responsibility and obligation under the LeaseContract.**Article 3	Rent Invoice**
	In accordance with Article 4 of the Main Contract, Party A shall issuetax invoice to Party B upon receipt of rent. Both Parties agree that Party Ashall issue the official invoice to Party B on or before the second day afterthe date of receipt of each instalment of rent, failing which, Party B shall beentitled to refuse to pay rent that is subsequently payable and shall onlyresume payment of rent to Party A when Party A issues official invoice to PartyB. The refusal to pay rent by Party B under this Article shall not constituteany breach of contract under the Lease Contract on the part of Party B.**Article 4	Management and Broker Fees  	Party Bshall pay directly to the management company selected by Party A to manage thepremises an amount per month not to exceed ten percent (10%) of the rent payableto Party A under the Main Contract.  The current management company is_________, with an address of ________________.  Party A shall provide Party Bwritten notice upon any change of management company.

	In connection with execution of the Main Contract andthis Agreement, Party B shall pay to Shenzhen Zhonglian Estate EnterpriseDevelopment Limited the amount of CNY 18,748.45, which represents payment infull of all amounts due and payable by Party B for any brokers or finders whohave a claim for any commission, finder's fee or other payment through  Party Aresulting from execution of the Main Contract and Agreement or from the leasingtransaction evidenced by the Main Contract and Agreement.  
**	Renovation
	Both Parties agree and confirm that during the term of the lease, Party Bshall be entitled to carry out reasonable partition and ordinary renovation workin respect of the interior of the Premises in accordance with its needs, andParty A has no right to intervene. Article 15 of the Main Contract shall notapply to the renovation work carried out by Party B in respect of the interiorof the Premises. Upon expiration or early termination of the term of the lease,Party B shall not remove the interior renovation work of the Premises and shallnot be required to reinstate the Premises when Party B delivers the Premises toParty A.**Article 5	Transfer**
	If Party A transfers the Premises during the term of the lease inaccordance with Article 17 of the Main Contract, Party A shall, after thetransfer, assume joint responsibility under the Lease Contract. In the event ofany violation of or failure to perform the responsibilities and obligationsunder the Lease Contract by the transferee of the Premises, Party B shall beentitled to make a claim against Party A.**Article 6	Right of Renewal**
	During the term of the lease (including the term of any renewal oflease), Party B shall be entitled to the right of renewal under Article 22 ofthe Main Contract. Each term of renewal shall be two years. The rent for the 3rdand 4th years shall all be increased by 5%. Any increase or decrease in rentafter the 4th year shall be determined in accordance with market circumstances.The following provision of Article 22 of the Main Contract shall not apply: 
	"Party B shall have pre-emptive right to lease in theevent of same terms and conditions." 

	Save and except Party A and Party B have agreedotherwise, Party A must consent to the request of Party B for a renewal of thelease in accordance with the provision of this Article for at least 3 times.Party A and Party B shall execute a new lease contract for such renewal andattend to the relevant registration formalities.
**Article 7	Right ofFirst Refusal

	During the term of the lease (including the term of any renewal oflease), Party B shall have a right of first refusal in respect of renting otheroffice premises owned by Party A in the same building where the Premises arelocated.**Article 8	Taxes

	During the term of the lease, Party B shall not pay any other fees toParty A, save and except for the rent under the Main Contract and the variousfees and taxes under Article 10 of the Main Contract.
	All fees and taxes incurred for handling registration ofthe Lease Contract with the competent authority shall be borne by Party A.
**Article 9	Execution and Effectiveness**
	This Agreement shall be executed by both Parties at the time of executionof the Main Contract. This Agreement shall take effect at the same time of theMain Contract, after signing and affixing of company chops by the legalrepresentatives or authorised agents of both Parties. 
	This Agreement shall constitute a supplement and anamendment to the Main Contract. In the event of any inconsistency between thisAgreement and the Main Contract, this Agreement shall prevail.
**Article 10	Others**
	This Agreement shall be executed in [		] counterparts. Party Ashall retain [	] counterparts. Party B shall retain [		] counterparts.The competent registration authority shall retain [		] counterparts.
 
**Party A: Shenzhen Jiannian Travel Limited (officialchop)		
**Party B: SBS Technologies, Inc. Foreign HoldingCompany (official chop)

Authorised Representative:				AuthorisedRepresentative:

[		] 2004					[		] 2004

 

Registration Clerk (sign & chop):			ContractRegistration Authority (sign & 							chop):  

[		] 2004					[		] 2004

	********************