Document:

ex101.htm

    
      EXHIBIT
10.1

    

    DOUGLAS
EMMETT, INC.

    2006
OMNIBUS STOCK INCENTIVE PLAN

    AMENDMENT
NO. 1

     

    Effective
upon approval by the stockholders of Douglas Emmett, Inc., the terms of the
Douglas Emmett, Inc. 2006 Omnibus Stock Incentive Plan (the "Plan")
are hereby amended as follows:

     

    1. Increase in
Number of Shares Authorized. The maximum number of
shares of Stock reserved and available for issuance under Section 3(a) of the
Plan shall be increased by 24,080,163 shares, which would bring the total number
of shares of Stock available for future grant under the Plan as of April 13,
2009 to 27,600,000 (subject to adjustment as set forth in the
Plan).

    

    2. Effect of
Awards.  For purposes of determining the number of shares of
Stock available for issuance under Section 3(a) of the Plan, the impact of any
Awards made after April 13, 2009 shall be determined by multiplying the number
of shares of Stock underlying such grant by the multiplier below:

    

    
      
        
          
            
              
                	
                        Type
      of Award

                      	
                        Multiplier

                      
	
                        Deferred
      Stock Award, Restricted Stock Award or Other Stock-Based Award that
      delivers the full value of the underlying Shares

                      	
                        2.0

                      
	
                        Stock
      Option, Stock Appreciation Right or Other Stock-Based Award that delivers
      the value of the underlying Shares in excess of  100% of the
      Company’s stock price (e.g. Stock Options with an exercise price of at
      least 100% of such price) on the date of grant and which has a term of
      more than five years.

                      	
                        1.0

                      
	
                        Stock
      Option, Stock Appreciation Right or Other Stock-Based Award that delivers
      the value of the underlying Shares in excess of  100% of the
      Company’s stock price on the date of grant and which has a term of five
      years or less

                      	
                        0.9

                      

              

            

          

        

      

    

    

    The impact of Awards made prior to
April 13, 2009 will continue to be calculated in accordance with the second
sentence of Section 3(a) of the Plan.

    

    3. Effect of
Repurchases.  Shares of Stock and Stock equivalents repurchased
by the Company with any cash proceeds from option exercises shall not be added back to
the shares of Stock and Stock equivalents available for grant under the
Plan.

    

    4. No Repricings
without Stockholder Approval.  Notwithstanding anything to the
contrary contained in the Plan, without the approval of a majority of the
Company’s stockholders (i) no Stock Option or Stock Appreciation Right issued
hereunder may be amended to reduce the exercise price thereof below the exercise
price of such Stock Option or Stock Appreciation Right on the date of grant and
(ii) no Stock Option or Stock Appreciation Right may be granted in exchange for
the cancellation or surrender of a Stock Option or Stock Appreciation Right
having a lower exercise price.  The second sentence of Section 16 of
the Plan is hereby deleted.

    

    5. Maximum Term for
Stock Appreciation Rights.  The term of each Stock Appreciation
Right shall be fixed by the Committee, but no Stock Appreciation Right shall be
exercisable more than ten years after the date the Stock Appreciation Right is
granted.

    

    6. Plan Remains in
Effect.  Except as set forth herein, the terms of the Plan
shall not be affected by this Amendment.  Capitalized terms not
otherwise defined in this Amendment are as defined in the Plan.ex10-1.htm

     

      
        

      

    

    
      	
               
      

            	
              Exhibit
      10.1

            

    

    
      	
               
      

            	
              ENGLISH
      TRANSLATION (FOR REFERENCE ONLY)

            

    

    

    
      	
              Note:

            	
              This
      translation copy is furnished for your reference only. No representation
      is made as to its accuracy or completeness and you may wish to seek
      independent translation of the Chinese version. In any events this
      translation copy is not legally binding and has no legal
      effect.

            

    

    

    

    Dated
the  12th   day of  June   ,
2009    .

    

    

    

    

    

    

    BLUEWATER
PROPERTY MANAGEMENT CO., LTD.

    (北京蓝泉物业管理有限公司)

    

    

    and

    

    

    Pacific
Asia Petroleum

    

    

    

    

    __________________________________________________

    

    TENANCY AGREEMENT

    

    in
respect of

    

    Room
08-10, Floor 5th (Actual
Floor 4th
)

    of

    Nexus
Center

    No.19A
East 3rd Ring Rd
North , Beijing,

    

    __________________________________________________

    

    

    

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    THIS TENANCY AGREEMENT is made
this 12th day of
June   Two Thousand and Nine

    

    

    BETWEEN the party named and
described as the Landlord in Part 1 of the Schedule hereto (“Landlord” which expression
shall where the context admits include its successors and assignees) of the one
part and the party named and described as Tenant in Part 1 of the Schedule
hereto (“Tenant”) of the
other part.

    

    

    WHEREBY
IT IS AGREED as
follows:

    

    1.           The
Landlord shall let and the Tenant shall take All Those premises (“Premises”) which form part of
the Nexus Center situated at No.19A East 3rd Ring Rd
North , Beijing, China., the People’s Republic of China Together with all those
fixtures fittings furniture or any other articles or things provided by the
Landlord as set out in the Appendix Four hereto for the term defined in Part 4
of the Schedule hereto (“Term”) YIELDING AND PAYING
therefor throughout the Term the rent (“Rent”) and property management
fees (“Property Management
Fees”) as are set out in Part 5 of the Schedule hereto and subject to the
terms and conditions hereinafter contained.

    

    2.           The
Schedule hereto together with the Standard Conditions of the Tenancy Agreement
(“Standard Conditions”)
set out in Appendix One hereto as varied and/or modified by the Special
Conditions (“Special
Conditions”) specified in Appendix Two hereto and other Appendices
expressly annexed hereto shall form part of this Tenancy Agreement and shall be
incorporated into this Tenancy Agreement.

    

    

    
      
         

      

      
        - 1
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    SCHEDULE

    

    This
Schedule sets out the details and particulars of this Tenancy Agreement and
unless the context otherwise requires the terms specified in this Schedule shall
have the meanings therein ascribed to them.

    

    Part 1 – the
Parties

    

    
      	
              Landlord:

            	
              Bluewater
      Property Management Co., Ltd

              (北京蓝泉物业管理有限公司)

            
	 
      	 
      
	
              Address:

            	
              Unit
      . 2709-2710, Nexus Center, No.19A East 3rd
      Ring Rd North , Beijing, China.

            
	 
      	 
      
	
              Tenant                      :

            	
              Pacific
      Asia Petroleum

            
	 
      	 
      
	
              Address:

            	
              No.B-118
      Jiangguo Ave. The Exchange Building, Suite 1809. Beijing,
      China

            

    

    

    Part 2 – the
Premises

    

    
      	
              Premises:

            	
              Unit(s)08-10
      on Floor 5th
      (actual floor 4th)
      of the Nexus Center (as shown for identification purposes only colored Red
      on the plan(s) annexed hereto as Appendix Three)

            
	 
      	 
      
	
              Building:

            	
              Nexus
      Center

            
	 
      	 
      
	
              Construction
      Area:

            	
              502.08square
      meters (including the usable space of the Premises and a pro-rata share of
      the enclosing structural elements and the mechanical and electrical
      installation areas and common facilities for the day-to-day operation of
      the Building). During the Term of the lease, all amounts which are
      calculated on the basis of the area are all based on the Construction Area
      stipulated herein.

            

    

    

    Part 3 – Delivery
Date

    

    
      	
              Delivery
      Date:

            	
              June
      15, 2009

            

    

    

    Part 4 - the
Term

    

    
      	
              Term:

            	
              2
      years (inclusive of the Commencement Date and Expiry
  Date)

            
	 
      	 
      
	
              Commencement
      Date:

            	
              0:00
      on September 1, 2009

            
	 
      	 
      
	
              Expiry
      Date:

            	
              24:00
      on August 31, 2011

            

    

    

    
      
         

      

      
        - 2
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    Any
renewal of the lease shall be subject to Clause 11.7.

    Part 5 – the Rent and the
Property Management Fees

    

    
      	
              Rent:

            	
              RMB156
      per calendar month per square meter, and the Monthly Rent of the Premises
      is RMB78,324.48 payable  according to the terms hereof. The
      Daily Rent equals to twelve times of the Monthly Rent divided by
      365.

            
	 
      	 
      
	
              Property
      Management Fees:

            	
              RMB30
      per calendar month per square meter, and the Monthly Property Management
      Fees of the Premises is RMB15,062.40 payable  according to the
      terms hereof. The Daily Property Management Fees equals to twelve times of
      the Monthly Property Management Fees divided by
  365.

            

    

    

    Part 6 – the Deposit and
Advance Payment

    

    
      	
              Deposit:

            	
              the
      sum equivalent to three-month Rent of the Premises and three-month
      Property Management Fees of the Premises, totalled RMB280,160.64 by way of
      cash security (payable by cash or bank cheques or bank transfer). The
      balance of the Deposit payable to the Landlord shall be RMB 186,773.76
      after deducting the amount of RMB 93,386.88 already paid by the Tenant on
      June 3, 2009.

            
	 
      	 
      
	
              Advance
      Payment:

            	
              RMB93,386.88
      payable for the Rent from September 1, 2009 to September 30, 2009 and
      Property Management Fees from June 15, 2009 to July 14,
    2009

            

    

    

    

    

    

    
      	
               
      

            	 

    

    

    

    
      
         

      

      
        - 3
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    The
signing page:

    

    

    Landlord:                                           Bluewater
Property Management Co., Ltd. (company chop)

    

    

    Legal
Representative

    or
authorized
representative:                                                                                                                                (signature)

    

    

    

    

    

    

    

    
      	
              Tenant:

            	
              Pacific
      Asia Petroleum (company chop)

            

    

    

    

    Legal
Representative

    or
authorized
representative:                                                                                                                                (signature)

    

    

    

    

    

    

    

    

    

    

    Appendices

    
      	
              1.

            	
              Appendix
      One:

            	
              Standard
      Conditions

            

    

    
      	
              2.

            	
              Appendix
      Two:

            	
              Special
      Conditions

            

    

    
      	
              3.

            	
              Appendix
      Three:

            	
              Coloured
      Floor Plan(s)

            

    

    
      	
              4.

            	
              Appendix
      Four:

            	
              Standard
      Delivery Status

            

    

    
      	
              5.

            	
              Appendix
      Five:   Acknowledgement by
Tenant

            

    

    
      
         

      

      
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    APPENDIX ONE – STANDARD
CONDITIONS

    

    Clause 1 – Rent and Property
Management Fees etc.

    

    The
Tenant to the intent that obligations hereunder shall continue throughout the
Term hereby undertakes and agrees with the Landlord as follows:

    

    1.1           (Rent and
Property Management Fees) To pay the Rent the Property Management Fees
and the handling charge of the cheques remittance or bank transfer on the first
day of each and every calendar month (hereinafter the “Due Date”) (in the event that
the first day in that calendar month is a statutory rest day or festival and
holiday, the Due Date shall be the last working day in the preceding calendar
month) or before and in the manner provided in the Schedule hereto in advance
clear of all deduction, set-off or withholding by way of cheques of immediate
value drawn in favour of “Bluewater Property Management Co., Ltd.” or by
remittance or bank transfer to the bank account designated by the Landlord in
writing from time to time. If the Commencement Date and The Expiry Date do not
respectively fall on the first or the last day of the calendar month, the
monthly payments to be made for the month in which the Commencement Date or the
Expiry Date falls shall be a multiple of the number of days included in the
first and last months of the Term and the daily Rent and/or daily Property
Management Fees.  The Property Management Fees shall include without
limitation all contributions towards the cost of the Landlord and/or its
property management company of the Building (“the Property Management
Company”) for and in providing central air-conditioning and heating,
maintaining environmental hygiene of the Building including garbage disposal
(excluding business or trade wastes of the Tenant), installing and maintaining
common facilities, providing water, electricity and communication services for
use in the common areas, public liability insurance, fire insurance and such
other insurance necessary against risks for managing the common areas of the
Building, remuneration and other benefits for security guards and other property
management personnel (including consultation fees payable to professionals where
necessary) and administration cost (including the remuneration of the Property
Management Company) and any other building services provided by the Landlord
and/or the Property Management Company. The Landlord shall be entitled to
prepare or revise the budget for the Property Management Fees periodically and
any readjustment of the Property Management Fees, if any, shall be notified in
writing to the Tenant and shall take effect from the date specified in such
notice.

    

    1.2           (Advance
Payment) To upon signing this Tenancy Agreement pay to the Landlord the
sum set out in the Schedule hereto (“Advance Payment”) which is
equivalent to the aggregate of (i) one (1) month’s Rent and Property Management
Fees as advance payment thereof; and (ii) if the commencement date of the rental
payment during the Term does not fall on the first date of a calendar month, the
Rent and the Property Management Fees shall be calculated on a pro-rata basis in
accordance with the number of days from the said commencement date to the last
date of that month under this Tenancy Agreement.

    

    1.3           (Occupation
Taxes) To pay and discharge all taxes charges impositions and other
outgoings of an annual or recurring nature now or hereafter to be imposed and
charged by all lawful authorities upon the Premises or upon the tenant or
occupier thereof under the relevant laws and regulations.

    

    1.4           (Charges)
To discharge all outgoings or charges for air-conditioning services for
non-business hours, telephone services, internet, telecommunication services,
electricity,

    
      
         

      

      
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    water (if
applicable), telephone lines and other services consumed in the Premises and all
necessary connection fees and deposits for such services. The rates and fees of
such services shall be subject to the invoices provided by the Landlord and/or
the Property Management Company.

    

    

    Clause 2 – Tenant’s
Obligations

    

    The
Tenant to the intent that obligations hereunder shall continue throughout the
Term hereby undertakes and agrees with the Landlord as follows:

    

    2.1           (Compliance
with regulations by-laws rules) To observe and comply with and to
indemnify the Landlord against the breach of any legislation law regulation
by-law rule and requirement of any government or other competent authorities
relating to the use and occupation of the Premises or to any other act deed or
thing done suffered or omitted therein or thereon by the Tenant or any employee
agent contractor or visitor of the Tenant and without prejudice to the foregoing
to obtain such licence approval or permit required by any government or other
competent authorities 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 to notify the Landlord forthwith in writing of any notice
received from any government or public authority concerning or in respect of the
Premises or any obligation under this Clause.

    

    2.2           (Obligation
to take possession of property etc.) To take possession of the Premises
upon the Delivery Date by following all steps and procedures required by the
Landlord, failing which possession shall be deemed to have been taken and the
Term shall be deemed to have commenced on the Commencement Date without
prejudice to other rights and remedies of the Landlord provided
herein.  For the avoidance of doubt, should the Tenant fail to make
full payment of the Deposit and Advance Payment to the Landlord before the
Delivery Date in accordance with this Tenancy Agreement, the Landlord shall have
no obligation to allow the Tenant to take possession of the Premises on the
Delivery Date.  The Commencement Date, Fit-out Period (if applicable)
and Rent-Free Period (if applicable) as provided hereunder shall not be delayed,
and in such case, the Tenant shall take possession of the Premises by following
all steps and procedures required by the Landlord within three workings day
after the Deposit and Advance Payment have been made in full.

    

    Should
the Tenant fail to take the required steps and procedures to take possession of
the Premises on the Delivery Date or within seven days of the time as provided
by this Section, the Landlord may, but is not obligated to, give the Tenant a
notice in writing to terminate this Tenancy Agreement.  In such case,
the Landlord shall have the right to forfeit all Deposit and have no obligation
to refund the same to the Tenant. The Deposit shall be the compensation to the
Landlord for its loss due to the default by the Tenant.

    

    2.3           (Repair
obligations) To keep all the interior non-structural parts of the
Premises including flooring and interior plaster or other finishes or rendering
to walls floors and ceilings the Landlord’s fixtures and fittings therein and
all additions thereto including but not limited to all doors windows electrical
installations wiring ducting and piping therein in good clean tenantable and
proper repair and condition and properly preserved and painted.

    

    2.4           (Injury
and damage to property, indemnity and insurance)

    
      
         

      

      
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    2.4.1  To
be responsible for, and to indemnify the aggrieved party who suffered directly
in, any damages of the Premises or part of it caused by fire, explosion, water
damage or smoke emission occurs at the Premises, or from any behaviour, failure
in performing duty or negligence by the Tenant or its employee, agent,
contractor, authorized person, invitee, or visitor, whereby the Tenant shall
also be legally liable to indemnify the Landlord for any claims however caused
or taken out by any person (including a third party) arising from the above
incidents.

    

    2.4.2  The
insurance policy taken out by the Landlord, in which the Landlord shall be named
beneficiary, will only cover the Premises’ structure, fixtures and ancillary
facilities.  In the event of the occurrence of any insurance incident,
the Landlord shall be the only party entitled to the proceeds paid by the
insurance company under such insurance policy. The Tenant shall in no event be
entitled to any claim for any such proceed due to any property damage and
personal injury arising out of such insurance incident.

    

    2.4.3                      Throughout
the Term of the lease (including the Rent-Free period), to effect insurance
cover with a reputable insurance company on public liability which include, but
not limited to, damages of the Premises or part of it caused by fire, explosion,
water damage or smoke emission occurs at the Premises, or any personal injury or
death and/on property loss or damage caused by any behaviour, failure in
performing duty or negligence of the Tenant or its employee, agent, contractor,
authorized person, invitee, or visitor, with an insured amount not less than
RMB3,000,000.00 yuan (in each claim) or an insured amount which may be
reasonably stipulated by the Landlord from time to time and the insurance policy
shall contain a clause to the effect that the insurance cover thereby effected
and the terms and conditions thereof shall not be cancelled, modified or
restricted, or the insured amount be reduced or the exemption amount be
increased unless the Landlord’s prior written consent is
obtained.  The insurance policy taken out by the Tenant shall include
but not limited to the following clauses:

    

    
      	
              1.

            	
              fire,
      explosion, smoke emission and water damage
  liability;

            

    

    
      	
              2.

            	
              cross
      liability;

            

    

    
      	
              3.

            	
              contractual
      obligation;

            

    

    
      	
              4.

            	
              Tenant
      obligation;

            

    

    
      	
              5.

            	
              personal
      injuries; and

            

    

    
      	
              6.

            	
              clauses
      relating to the Premises’ modification, expansion, repairs and
      maintenance.

            

    

    

    2.4.4  Prior
to the Commencement Date, to provide to the Landlord a copy of the cover note of
such policy and the receipt for the paid premium or a letter of confirmation
from the insurer, so as to prove that it has already taken out adequate
insurance cover pursuant to the above requirements.  The Tenant shall
also within two months from the Commencement Date provide to the Landlord a copy
of the above insurance policy for records.  In the event that the
above policy expires during the term of the lease of the Premises, the Tenant
shall complete renewal of the insurance policy duly and shall within one month
from the expiry date of the previous insurance policy provide to the Landlord
copy of the renewed policy together with copy of the paid premium or a letter of
confirmation from the insurer for records.

    

    2.4.5  .Throughout
the Term of the lease (including the Rent-Free period), the Tenant shall
maintain insurance policy or policies with respect to its own possessions and
any other items within the Premises, and its employees as required by the
applicable laws.

    
      
         

      

      
        - 7
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    2.5           (Replacement
of windows or curtain wall) To reimburse to the Landlord the cost of
replacing all broken and damaged windows and glass or curtain wall if the same
be broken or damaged by the act or neglect of the Tenant its employees agents
contractors invitees customers or visitors.

    

    2.6           (Entry by
Landlord) To permit the Landlord and all persons authorized by it at all
reasonable times upon notice to enter and view the state of repair of the
Premises to take inventories of the fixtures and fittings therein and to carry
out any works repairs or maintenance to the Premises and/or the Building
provided that in the event of an emergency the Landlord and/or the Property
Management Company and their employees or agents may enter without notice and
forcibly if need be and for this purpose, the Tenant shall inform the Landlord
as to the presence and nature of any security system of the Tenant installed in
the Premises.

    

    2.7           (Notice
of repair) On receipt of any notice from the Landlord or its authorized
representative specifying any repairs which are required to be done and which
are the responsibility of the Tenant hereunder forthwith to put in hand and
execute the same without delay. Failure by the Tenant so to do will entitle the
Landlord or its employees or agents to enter upon the Premises and forcibly if
need be to carry out any such works or repairs at the expense of the
Tenant.

    

    2.8           (Inform
Landlord of damage) To give notice in writing to the Landlord of any
injury to person occurred in and any damage that may be suffered to the Premises
and of any accident to or defects in the water pipes electrical wiring or
fittings fixtures or other facilities provided by the Landlord.

    

    2.9           (Directory
boards) To pay the Landlord immediately upon demand the cost of affixing
repairing altering or replacing as necessary the Tenant’s name in lettering to
the directory boards provided by the Landlord.

    

    2.10           (Viewing
Advertising and Reletting) To permit at all reasonable times upon prior
notice during the three calendar months immediately preceding the expiration of
the Term prospective tenants or occupiers to inspect the Premises and every part
thereof.

    

    2.11           (Regulations)
To observe and perform and not to contravene any of the provisions contained in
the Regulations as may from time to time be adopted by the Landlord pursuant to
Appendix One hereof.

    

    2.12           (Deeming
acts and defaults) To be responsible to the Landlord for any breach
non-observance non-performance of the terms conditions agreements or
stipulations by and the acts neglects omissions and defaults of all employees
agents contractors or visitors of the Tenant as if they were the breach
non-observance non-performance of the terms conditions agreements or
stipulations by and the acts neglects omissions and defaults of the Tenant
itself.

    

    2.13  (Handover
of Premises) Upon expiry or termination of this Tenancy Agreement for
whatsoever reasons, to reinstate the Premises to the condition as per the
standards (as set forth in Appendix Four hereunder) when the Landlord delivered
the Premises to the Tenant

    
      
         

      

      
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    for
usage, i.e. to dismantle any fixtures fittings or additions or alterations made
by the Tenant to the Premises after taking procession so as to reinstate the
Premises to the condition when the Premises is delivered to the Tenant, and to
deliver the Premises to the Landlord together with all the fixtures,
installation and additional facilities. All the shortfall shall be supplemented
or compensated by the Tenant for the damages, tear and wear of the materials.
The Landlord shall supply the detailed quotation for deficient items and the
Tenant agrees that the amount in such quotation shall be deducted directly by
the Landlord from the security deposit. The returned Premises together with all
fixtures, fittings and ceiling accessory materials therein and thereto shall be
in a complete, good, clean, tenantable and properly repaired condition. The
Tenant shall not be entitled to claim any compensation or damages from the
Landlord in respect of any fixtures fittings or additions made by the Tenant in
the Premises. Should the Landlord make such request, the Tenant shall handle
such removal of its personal belongings, fixtures, fittings and additions and be
responsible for such removal and transportation costs upon the expiry of this
Tenancy Agreement or its earlier termination. As such, should there be any
damages caused to the Premises and fixtures, fittings and additions which ought
to be returned to the Landlord during the course of such removal, the Tenant
shall make such remedy to the Landlord’s satisfaction in a proper and
sophisticated manner. Should the Tenant be unable to fulfill the aforesaid duty
in accordance with the Landlord’s requirement, the Tenant agrees to pay any and
all removal and transportation costs irrespective of whether the Landlord
handles such work itself or hires contractor to perform the same instead. The
Tenant shall surrender to the Landlord all keys giving access to all parts of
the Premises and permit the Landlord to remove at the Tenant’s expenses all
letters and characters relevant to the Tenant from the directory boards and from
all the doors, walls or windows of the Premises and to make good any damage
caused by such removal. If the Tenant fails to reinstate the Premise (except for
the case where both parties agree that the internal fittings, decoration or
accessories shall be retained) and to deliver up vacant possession of the
Premises on the expiry or earlier termination date of this tenancy according to
the stipulations in this Clause, the Tenant shall pay to the Landlord a late
delivery compensation (which is equivalent to 300% of the amount of the daily
Rent and Management Fee of the Premises) for each day of the period of delay in
delivering possession of the Premises to the Landlord (“Overstay”). AND acceptance of such Overstay
compensation by the Landlord shall not mean that the Landlord recognizes the
Tenant’s Overstay.  Further, notwithstanding the Landlord’s acceptance
of such Overstay compensation, if there are articles fixtures or fittings
remained or abandoned in or at the Premises upon the expiry or earlier
termination of this tenancy, the Landlord is entitled to terminate electricity,
air-condition, water supply, telephone, internet and / or other services and
supplies to the Premises without prior notice and to take possession of the
Premises. The Tenant hereby agrees to disclaim the ownership of such articles
and agrees that the Landlord can freely dispose of the same including but not
limited to disposal, realization or similar manners. Gains accrued there from
shall belong to the Landlord (if any) and costs shall be born by the Tenant (if
any) and the Landlord shall not be accountable to the Tenant or any other
persons for any loss or damage in respect of such disposal or any other
treatment thereof. Further, the Landlord is entitled to refuse entry into the
Premises by the Tenant or its employee, agent, contractor, authorized person,
invitee, customer or visitor upon the expiry or early termination of this
Tenancy Agreement (notwithstanding the Tenant’s payment of the Overstay
compensation), all risk and consequence arising out of such refusal shall be
solely borne by the Tenant accordingly.

    

    2.14           (Electronic
Installations, circuits, piping and ducting) To repair and replace
any electrical installation wiring ducting or piping installed by the Tenant if
the same becomes

    
      
         

      

      
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    dangerous
or unsafe or if so reasonably required by the Landlord or by the relevant
utilities company and the Tenant shall use the Landlord's one of the recognised
contractors for the electric power project of fire-service (including
thermometric sensor and smoke detection system) and the wiring (from the meter
room to the Tenant's main switch) works.  The Tenant shall permit the
Landlord or its agents to test the fire-service, air-conditioning and wiring
ducting or piping installed by the Tenant in the Premises at any reasonable time
upon request being made.

    

    2.15           (Cleaning)
To keep the Premises including where the Tenant occupies the entire floor(s)
including the common area and the lift lobbies on the floor(s) of the Building
occupied by the Tenant at all times in a clean and sanitary state and
condition.

    

    2.16           (Cleaning
of drains) To pay to the Landlord on demand all costs incurred by the
Landlord in clearing repairing or replacing any of the drains pipes or sanitary
or plumbing apparatus choked or stopped up owing to the careless or improper use
or neglect by the Tenant or any employee agent contractor invitee guest or
visitor of the Tenant and to indemnify the Landlord against any cost claim or
damage caused thereby or arising therefrom.

    

    2.17           (Protection
from bad weather) To take all reasonable precautions to protect the
Premises against damage by storm heavy rainfall heavy snowfall or the like and
in particular to ensure that all exterior doors and windows are securely
fastened upon the threat of such adverse weather conditions.

    

    2.18           (Outside
windows and doors) To keep all outside windows and doors closed and in
the event of a breach of this Clause the Landlord shall have the right to send a
representative to close any open door or doors or window or windows should the
Tenant fail to forthwith comply with the Landlord’s request to close the
same.

    

    2.19           (Service
entrances and lifts) To load and unload goods only at such times and
through such service entrances and by such service lifts as shall be designated
by the Landlord for this purpose from time to time.

    

    2.20           (Refuse
and garbage removal) To be responsible for the removal of garbage and
refuse from the Premises and to dispose of such garbage and refuse only in those
areas in the Building as shall be designated by the Landlord from time to
time.

    

    2.21           (Conducting
of business) To conduct the business of the Tenant so as not to prejudice
the goodwill and reputation of the Building as a first class office
building.

    

    2.22           (Indemnity
against breach) To keep the Landlord fully indemnified from and against
all actions claims losses damages expenses and legal costs which the Landlord
may suffer or incur as a result of or arising from any of the Tenant’s breach
non-observance or non-performance of any term condition agreement or stipulation
contained in this Tenancy Agreement or out of any works carried out by the
Tenant at any time during the Term to the Premises or out of anything affixed
and/or installed by the Tenant now or during the Term attached to or projecting
from the Premises or arising from any act neglect or default of the
Tenant.

    
      
         

      

      
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    2.23           (Usage)
Not to use or permit to use the Premises or suffer the Premises to be used for
purpose other than as office, and to observe any PRC and Beijing regulations in
respect of property use and property management. Tenant hereby warrants that the
aforesaid purpose of the Premises shall not change within the Term without the
prior written consent of Landlord and the approval from relevant
authority.

    

    Clause 3 – Landlord’s
Obligations

    

    The
Landlord agrees with the Tenant as follows:

    

    3.1           (Quiet
enjoyment) Subject to the Tenant paying the Rent, the Property Management
Fees and other amounts hereby agreed to be paid at the time and in the manner
herein provided for payment of the same and observing and performing the terms
conditions agreements and stipulations contained in this Tenancy Agreement and
to be observed and performed by the Tenant to permit the Tenant to peacefully
hold and enjoy the Premises during the Term without any interruption by the
Landlord or any person lawfully claiming through the Landlord provided that the
Tenant acknowledges that the Landlord or the Property Management Company shall
have the right to carry out renovation alteration and/or repair works within,
outside and/or above the Building and that fitting-out works may be carried out
by the Landlord and/or other tenants of the Building.

    

    3.2           (Roof and
main structure) To keep the main structural parts of the Building in a
proper state of repair.

    

    3.3           (Decoration)
To carry out all necessary decoration to the common areas of the Building as and
when the Landlord shall decide the same is necessary.

    

    3.4           (Cleaning)
To keep the common areas and toilets and other parts of the Building for common
use clean and in proper condition.

    

    3.5           (Common
Facilities) To maintain any lifts escalators fire and security services
equipment air-conditioning plant and other common service facilities of the
Building in proper working order.

    

    3.6           (Air-conditioning)
During normal working hours, to provide air-conditioning services to the
Premises daily from Monday to Friday (including those Saturdays and Sundays that
become working days according to public holiday schedule) from 8:00 a.m. until
7:00 p.m. and from 8:00 a.m. until 12:00 a.m. of Saturdays (excluding public
holidays). Days other than those provided hereby as within normal working hours
and public holidays shall be considered outside of normal working hours and no
air-conditioning services will be provided. If the Tenant shall require
air-conditioning services for extra hours the Landlord may provide the same to
the Tenant on receiving reasonable prior notice of the Tenant’s requirement. The
charges for such additional air-conditioning shall be determined by the Landlord
and notified to the Tenant from time to time and the Tenant shall forthwith pay
the charges thereof on receipt of the demand note therefore.

    

    3.7  3.7   (Registration
of the Tenancy) Upon request of the
Landlord, the Tenant shall assist the Landlord in applying for registration of
the lease, including but not limited to providing valid and lawful business
license, and signing relevant documents. The registration

    
      
         

      

      
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    fees
therefore incurred shall be equally shared by both parties.

    

    

    Clause 4 – Restrictions and
Prohibitions

    

    The
Tenant hereby agrees with the Landlord as follows:

    

    4.1           (Renovation,
Installation and alteration) Not without the prior written consent of the
Landlord (such consent not to be unreasonably withheld) to erect install or
alter any fixtures partitioning or other erection or installation in the
Premises or any part thereof or to make or permit or suffer to be made any
installations in or additions to the electrical wiring piping ducting and any
other installations or to install or permit or suffer to be installed any
equipment apparatus or machinery which imposes a weight on any part of the
flooring in excess of that for which it is designed or which requires any
additional electrical wiring piping or ducting or which consumes electricity not
metered through the Tenant’s separate meter. 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 dimensions and
material to distribute the weight as the Landlord may deem necessary and that in
carrying out any approved work hereunder the Tenant and its employees agents
contractors and workmen shall cooperate fully with the Landlord and all the
employees agents contractors and workmen of the Landlord and with other tenants
or contractors carrying out any work in the Building. The Tenant its employees
agents contractors and workmen shall obey and comply with all instructions and
directions which may be given by the Landlord or its representative in
connection with the carrying out of such work.

    

    4.2           (Criteria
for commencing business) Not to use occupy the Premises to commence
business or operation (whether temporarily or otherwise), the Landlord may at
its discretion refuse to provide the necessary facilities and services to the
Premises including the electricity and air-conditioning unless and until the
Tenant (i) has obtained all necessary unconditional completion/approval
certificate(s) duly issued by the competent authorities in respect of all works
and installation to the Premises which shall be legally required for commencing
business or operation at or in the Premises; and (ii) has deposited with the
Landlord at all times during the Term the relevant valid completion/approval
certificate(s) therefor; failing which the Landlord may at its discretion refuse
to provide the necessary facilities and services to the Premises including the
electricity supply and air-conditioning facility.

    

    4.3           (Signs)
Not to affix or display or permit or suffer to be affixed or displayed within or
outside the Premises any signboard sign decoration advertising matter or other
device whether illuminated or not which may be visible from outside the Premises
and the Landlord shall have the right to remove the same at the cost and expense
of the Tenant Provided that:

    
      	
              (i)

            	
              the
      Tenant shall be entitled to have its name displayed in English and Chinese
      in uniform lettering and/or characters designated by the Landlord on the
      directory boards, such lettering and characters and any additions or
      alterations thereto will be placed thereon by the Landlord at the Tenant’s
      expense; and

            

    

    
      	
              (ii)

            	
              the
      Tenant shall be entitled at its own expense to have its name affixed in
      lettering and/or characters of dimensions approved by the Landlord on the
      Tenant’s main entrance door.

            

    

    Save as
provided in (i) and (ii) above, the Tenant shall not do or permit or suffer any
act which may alter or otherwise adversely affect the appearance of the Premises
or the Building.

    
      
         

      

      
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    4.4           (Illegal
or immoral use) Not to use or permit or suffer the Premises to be used
for any illegal immoral or improper purpose.

    

    4.5           (No
touting) Not to permit any touting or soliciting for business or the
distributing of any pamphlets notice or advertising matter outside the Premises
or anywhere within or near the vicinity of the Building by any of the Tenant’s
employees or agents.

    

    4.6           (Auction
and Exhibition) Not to hold or permit or suffer to be held in the
Premises any exhibition auction or similar sale of things or properties of any
kind.

    

    4.7           (Sleeping
or domestic use) Not to use or permit or suffer the Premises or any part
thereof to be used as sleeping quarters.

    

    4.8           (Manufacture
or storage of goods) Not to use or permit or suffer the Premises to be
used for the production manufacture or working of goods or merchandise nor for
the storage of goods and merchandise other than samples and exhibits in small
quantities reasonably required in connection with the Tenant’s business carried
on therein.

    

    4.9           (Combustible
or dangerous goods) Not to keep or store or permit or suffer to be kept
or stored in the Premises any arms ammunition gun-powder salt-petre kerosene or
other explosive or combustible substance or hazardous or unlawful goods and not
at any time during the Term to allow the Premises or any part thereof to be used
in any way entailing a fine forfeiture or penalty against the Landlord under any
laws for the time being in force in the People’s Republic of China.

    

    4.10           (Obstruction
to Passages) Not to encumber or obstruct or permit or suffer to be
encumbered or obstructed with any boxes packaging rubbish or other articles or
obstruction of any kind or nature any of the entrances exits staircases landing
passages escalators lift lobbies or other parts of the Building in common use
and the Landlord shall if it thinks fit be entitled without notice and at the
Tenant’s expense to remove and dispose of any such boxes packaging rubbish or
other articles or obstruction as it sees fit without incurring any liability
therefor.

    

    4.11           (Articles
in common area) Not to lay install affix or attach any wiring cables or
other articles or things at in or upon any of the entrances exits staircases
landings passages lobbies or other parts of the Building in common use without
having obtained the Landlord’s prior written consent.

    

    4.12           (Breach
of insurance policy) Not to do or permit or
suffer to be done any act deed matter or thing whatsoever whereby the insurance
policies on the Building and/or the Premises against loss or damage by fire
and/or other insurable perils and/or claims by third parties for the time being
in force may become void or voidable or whereby the rate of premium or premiums
thereon may be increased Provided that if as the result of any act deed matter
or thing done permitted or suffered to be done by the Tenant the rate of premium
on any such policy of insurance shall be increased the Landlord shall be
entitled without prejudice to any other remedy hereunder to recover from the
Tenant the amount of any such increase. Furthermore, the Tenant shall provide
relevant documentary evidence or assistance to the insurance company upon its
request.

    
      
         

      

      
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    4.13           (Air-conditioning)
Not without the prior written consent of Landlord to install air-conditioning
facilities in addition to such facilities as are provided by the
Landlord.

    

    4.14           (Parking)
Not to park in obstruct or otherwise use nor permit any employee agent or
visitor of the Tenant to park in obstruct or otherwise use those areas of the
Building allocated to the parking or movement of or access for vehicles or
designated as loading/unloading areas otherwise than in accordance with the
Regulations made by the Landlord pursuant to Clause 9 of Appendix
One.

    

    4.15           (Use of
Building name) Not without the prior written consent of the Landlord to
use or permit to be used the name/logo or any part of the name/logo of the
Landlord or of the Building or any picture representation or likeness of the
whole or any part of such name/logo or of the Building or of the Premises in
connection with the business or operations of the Tenant or for any purpose
whatsoever other than to indicate the address and place of business of the
Tenant only.

    

    4.16           (Damages
to walls and ceiling etc.) Not without the prior written consent of the
Landlord to cut maim injure drill nail or screw into mark or deface or permit or
suffer to be cut maimed injured drilled into marked or defaced any doors windows
walls beams structural members or any part of the fabric of the Premises or any
of the plumbing or sanitary or air-conditioning apparatus or installations
therein, nor without such consent of the Landlord to do any other thing which
may damage or penetrate the existing floor screed or slab.

    

    4.17           (Damage
to common areas) Not to damage injure or deface any part of the common
areas of the Building including without limitation the fabric decorative
features the stairs lifts escalators any trees plants or shrubs therein or
thereabout.

    

    4.18           (Nuisance
or annoyance) Not to do or permit or suffer to be done any act or thing
which may be or become a nuisance or annoyance to the Landlord or to the tenants
or occupiers of other premises in the Building.

    

    4.19           (Noise)
Not to cause produce or permit or suffer to be produced at any time in the
Premises any disturbing or irritating noise or any music sound or noise
(including sound produced by broadcasting or any apparatus or equipment capable
of producing reproducing receiving or recording sound) which may be audible
outside the Premises.

    

    4.20           (Toilet
facilities) Not to use or permit or suffer to be used the toilet
facilities provided by the Landlord in the Premises or in the common areas of
the Building for any purpose other than that for which they are intended and not
to throw or permit or suffer to be thrown therein any substance or object
incompatible with their intended use and the Tenant shall pay to the Landlord on
demand the whole expense of any breakage blockage or damage resulting from a
violation of this Clause.

    

    4.21           (Animals
pets and infestation) Not to keep or permit or suffer to be kept any
animals or pets inside the Premises and at the Tenant’s expense to take all such
steps and precautions as shall be required by the Landlord to prevent the
Premises or any part thereof from becoming infested by pests or
vermin.

    

    4.22           (Preparation
of food and prevention of odours) Not to cook or prepare or permit
or

    
      
         

      

      
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    suffer to
be cooked or prepared any food in the Premises or to cause or permit any
offensive or unusual odours to be produced upon or emanated from the
Premises.

    

    4.23           (Aerials)
Not to erect any aerial on the roof or walls of the Building or on the ceiling
or walls of the Premises and not to interfere with remove dismantle or alter
those common aerials (if any) provided by the Landlord.

    

    Clause 5 –
Exclusions

    

    Unless
caused through the gross negligence of the Landlord its employees or agents, the
Landlord shall not be liable to the Tenant occupier or any other person
whomsoever:

    

    5.1           (Lift
escalators air-conditioning etc.) In respect of any injury loss damage or
death to person or property sustained by the Tenant occupier or any such other
person caused by or through or in any way owing to any defect in or breakdown of
any of the lifts escalators fire and security services equipment
air-conditioning plant telecommunication services or any other facilities of and
in the Premises or the Building; or

    

    5.2           (Electricity/water
supply) In respect of any injury loss damage or death to person or
property sustained by the Tenant occupier or any such other person caused by or
through or in any way owing to any failure malfunction explosion or suspension
of the electricity or water supply to the Building or the Premises;
or

    

    5.3           (Fire and
overflow of water and vermin) In respect of any injury loss damage or
death to person or property sustained by the Tenant occupier or any such other
person caused by or through or in any way owing to fire or the escape of fumes
smoke odours or any substance or thing or the overflow or leakage of water from
anywhere within the Building or the influx of rain water or storm water into the
Building or the Premises or the activity of rats or other vermin in the
Building; or

    

    5.4           (Security)
For the security or safekeeping of the Premises or any persons or contents
therein and in particular but without prejudice to the generality of the
foregoing the provision by the Landlord or the Property Management Company 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 or
the Property Management Company 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; or

    

    5.5           (Non-enforcement
of the Regulations) In respect of any injury loss damage or death however
caused by or arising from any non-enforcement of the Regulations under Clause
9 of Appendix One
or non-observance thereof by any party; or

    

    Nor shall
the Rent or the Property Management Fees payable by the Tenant hereunder or any
part thereof be abated or cease to be payable on account of any of the foregoing
circumstances.

    

    

    
      
         

      

      
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    Clause 6 – Abatement of
Rent

    

    If the
Premises or any part thereof shall be destroyed or so damaged by fire bad
weather Act of God force majeure or other cause not attributable directly or
indirectly to any act or default of the Tenant as to render the Premises unfit
for use and occupation the Rent hereby agreed to be paid or a part thereof
proportionate to the nature and extent of the damage sustained shall cease to be
payable until the Premises shall have been restored or reinstated Provided
Always that the Landlord shall be under no obligation to repair or reinstate the
Premises if in its opinion it is not reasonably economical or practicable so to
do and Provided Further that if the whole or substantially the whole of the
Premises which have been destroyed or rendered unfit for use and occupation
shall not have been repaired and reinstated within six months of the occurrence
of the destruction or damage either party hereto shall be entitled at any time
before the same are so repaired and reinstated to terminate this Tenancy
Agreement by notice in writing to the other 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 terms and conditions herein contained or of
the Landlord in respect of the Rent the Property Management Fees and other
charges payable hereunder prior to the coming into effect of the
cessation.

    

    

    Clause 7 –
Default

    

    It is
hereby further expressly agreed and declared as follows:

    

    7.1           (Material
Default) Entirely without prejudice to the provisions of Clause 8.1 of
Appendix One, each of the following events would constitute a Material Default
under this Tenancy Agreement:

    

    (i) the
Rent, the Property Management Fees and/or other amounts payable by the Tenant
under this Tenancy Agreement or any part thereof (including but not limited to
Advance Payment and Deposit and Overdue Delinquent Payment and so on) remain
unpaid in full within fourteen (14) days after the same shall have become
payable (whether the Tenant has been demanded to pay or not); or

    

    (ii) any
breach non-observance or non-performance by the Tenant of any of the terms
agreements stipulations or conditions hereof and failed to be cured within the
time period as required by Landlord; or

    

    (iii) any
of the assets of the Tenant has been seized, forfeited or distrained by the
People’s Court or any competent authority; or

    

    (iv) the
Tenant shall become bankrupt or being a corporation shall go into liquidation;
or

    

    (v) any
petition shall be filed for the bankruptcy or winding up of the Tenant;
or

    

    (vi) the
Tenant shall otherwise become insolvent (including but not limited to amounts
payable by the Tenant under other tenancies with premises of Nexus Center shall
not be fully paid for fourteen (14) days after relevant due dates.) or make any
composition or arrangement with its creditors or shall suffer any execution to
be levied on the Premises

    
      
         

      

      
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    (vii) the
Tenant, without prior written notice of the Landlord, consents to change the
usage of the Premises, the business scope, trade name or name of the Tenant;
or

    

    (viii)
any serious damage caused by the Tenant to the Premises; or

    

    
      	
               
      

            	
              (ix)
      the Tenant, without prior consent, sublet the Premises, assign the tenancy
      or carry out a exchange of the leased Premises with other parties;
      or

            

    

    

    (x) the
Tenant, without prior written consent of the Landlord, alter the structure of
the Premises.

    

    7.2   (Remedial
Rights) Under any condition as
stipulated under Section 7.1, the Landlord may give written notice to the Tenant
requesting remedies to such Material Default(s) within the required
period.  Should such Material Default(s) has/have not been remedied
within the time limit provided in a written notice has been served by the
Landlord to the Tenant, the Landlord may further exercise all of the following
rights (the “Remedial
Rights”):

    

    
      	
              (i)

            	
              to
      enter or re-enter on the Premises or any part thereof in the name of the
      whole;

            

    

    

    
      	
              (ii)

            	
              to
      terminate this Tenancy Agreement absolutely but without prejudice to any
      right of action of the Landlord in respect of any outstanding breach or
      non-observance or non-performance by the Tenant of any of the agreements
      stipulations and conditions herein
contained;

            

    

    

    
      	
              (iii)

            	
              to
      forfeit the Deposit and other deposits paid by the Tenant as part of the
      liquidated damages due to the Tenant’s breach without prejudice to the
      Landlord’s right of deduction in accordance with Clauses 7.8 of Appendix
      One and claim for further compensation;
and

            

    

    

    
      	
              (iv)

            	
              to
      do all lawful things and/or to take all lawful actions which the Landlord
      considers necessary or desirable to remedy the Material
      Default(s).

            

    

    

    7.3   (Disconnection
of Utilities) Under any condition as stipulated under Section 7.1, the
Landlord may disconnect all electricity, air-conditioning, water, telephone,
internet, other utility services and/or supplies to the Premises provided that a
three (3) days’ th prior notice
has been given to the Tenant of the Landlord‘s intention to do
so.  All relevant costs and expenses incurred by the Landlord in
connection with the disconnection and the subsequent re-connection of the
electricity air-conditioning, water, telephone, internet, other utility services
and/or supplies to the Premises shall be paid by the Tenant and shall be
recoverable from the Tenant as a debt or be deductible by the Landlord from the
Deposit paid by the Tenant in accordance with Clause 8 of Appendix One
hereof.

    

    7.4           (Exercise
of right)  A written notice served by the Landlord on the
Tenant in manner hereinafter mentioned to the effect that the Landlord thereby
exercises the power of re-entry and determination of the Tenancy Agreement
herein contained shall be a full and sufficient exercise of such power without
physical entry on the part of the Landlord. Upon dispatch of the written notice
of re-entry, the Premises shall be deemed to have been

    
      
         

      

      
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    repossessed
by the Landlord and the Tenant shall be deemed evicted. Thereafter, the Landlord
shall be entitled to dispose of the Premises and any items or chattels left on
the Premises in such manner as it wishes and it shall not incur any liability to
the Tenant therefor.

    

    7.5           (Acceptance
of Rent and Property Management Fees) Acceptance of the Rent and/or the
Property Management Fees and/or other amounts by the Landlord shall not be
deemed to operate as a waiver by the Landlord of any right to proceed against
the Tenant in respect of any breach non-observance or non-performance by the
Tenant of any of the agreements stipulations and conditions herein contained and
on the Tenant’s part to be observed and performed.

    

    7.6           (Payment
Order) The Rent payable in respect of the Premises shall be and be deemed
to be in arrears if not paid in advance at the times and in the manner
hereinbefore provided for payment thereof. In such a case, the Landlord may
apply for Payment Order issued by the People’s Court in accordance with the
supervisory procedures of the PRC Civil Procedure Law and
all costs and expenses thus incurred shall be borne by the Tenant.

    

    7.7           (Overdue
Delinquent Payment) Without prejudice to the Landlord’s other rights and
remedies on such default, if the Rent, the Property Management Fees or any other
charges payable by the Tenant under this Tenancy Agreement or any part thereof
shall not be paid in the manner and at the time specified herein, then Overdue
Delinquent Payment shall be payable by the Tenant at the rate of 0.1% of the due
and unpaid amount per day calculated on daily basis from the due date up to the
date of actual payment (both inclusive).

    

    7.8    (Undertaking)
Save and except in the event of force majeure during the agreed rental period,
the Tenant shall under no circumstances terminate this Tenancy Agreement
prematurely.  If the Tenant chooses to terminate this Tenancy
Agreement before the expiration of the Term, or this Tenancy Agreement is
terminated prematurely or cannot be performed due to breach of this Tenancy
Agreement by the Tenant, the Landlord shall not be required to return to the
Tenant the Deposit and other deposits (if any) already paid.  Further,
the Tenant shall also be required to pay all the rentals that should be payable
during the un-performed term of the Tenancy Agreement(i.e. the aggregate
sum of the Deposit paid by the Tenant and the rentals should be payable during
the un-performed term shall be regarded as liquidated damages payable by the
Tenant to the Landlord due to the Tenant’s early termination  or being
unable to perform). In case the loss
to the Landlord caused by such termination exceeds the rentals that should be
payable during the un-performed term of the Tenancy Agreement, the Tenant shall
be liable to indemnify the Landlord for such exceeding loss.  The
Landlord shall have the right to offer the Premises to other tenants so as to
minimize the loss that may arise from the Tenant’s breach of
contract.

    

    Clause 8 -
Deposit

    

    8.1           (The
Deposit) The Tenant shall on the signing hereof deposit with the Landlord
the deposit in Renminbi specified in the Schedule to this Tenancy Agreement
(“Deposit”) to secure
the due observance and performance by the Tenant of the terms conditions
agreements and stipulations contained in this Tenancy Agreement and to be
observed and performed by the Tenant. The Deposit shall be retained by the
Landlord throughout the Term free of any interest and in the event of any breach
or non-observance or non-performance by the Tenant of any of the agreements
stipulations or conditions under this Tenancy Agreement the

    
      
         

      

      
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    Landlord
shall be entitled, by exercising its Remedial Rights provided in this Tenancy
Agreement, to terminate this Tenancy Agreement, forfeit the Deposit and claim
further compensation for the costs expenses loss or damage thus incurred.
Notwithstanding the foregoing, the Landlord may in any such event at its option
deduct immediately after the occurrence of the breach non-observance or
non-performance of any agreement stipulation or condition of this Tenancy
Agreement from the Deposit the amount of any monetary loss incurred by the
Landlord in consequence of such breach non-observance or non-performance with or
without prior notice to the Tenant (the Landlord can exercise such right at its
own absolute discretion) in which event the Tenant shall as a condition
precedent to the continuation of the tenancy deposit with the Landlord the
amount so deducted within 7 days after receiving the written notice of the
Landlord demanding the same and if the Tenant shall fail so to do the Landlord
shall forthwith be entitled to exercise all of its Remedial Rights.

    

    8.2           (Repayment
of the Deposit) Subject to any aforesaid deduction or forfeiture, the
Deposit shall be refunded to the Tenant by the Landlord without interest within
thirty (30) days after:  (a) the expiration of this Tenancy Agreement
and the handover of the Premises to the Landlord in accordance with Clause 2.13
of Appendix One; (b) the settlement of the last outstanding claim by the
Landlord against the Tenant in respect of any breach non-observance or
non-performance of any of the agreements stipulations or conditions herein
contained and on the part of the Tenant to be observed and performed; and (c)
the relevant telephone telecommunication and electricity authorities have
cleared the Tenant’s telephone telecommunication and electricity accounts;
whichever is the latest. The Deposit shall be refunded to the Tenant without
interest in the same amount as it was paid to the Landlord, subject, however, to
the Landlord’s right to make deduction, withholding or set off according to the
terms of this Tenancy Agreement.

    

    

    Clause 9 -
Regulations

    

    9.1           (Introduction
of Regulations) The Landlord reserves the right from time to time and by
notice in writing to the Tenant to make and introduce and subsequently amend
adopt or abolish if necessary such rules and regulations  including
but not limited to the Users’ Handbook and Fit-out Instruments (altogether, the
“Regulations”) as it may
consider necessary for the control of use of parking spaces, fitting-out and the
access operation management and maintenance of Nexus Center as a first class
office building and for the compliance of the relevant laws regulations or
requirements imposed by the competent authorities.

    

    9.2           (Conflict)
Such Regulations shall be supplementary to the terms and conditions contained in
this Tenancy 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 Tenancy Agreement, the terms and conditions of this Tenancy
Agreement shall prevail. For the purpose of this Tenancy Agreement, a conflict
exists when no matter being interpreted in what way, the meaning of the
provisions become contrary to each other.

    

    

    Clause 10 – Early
Termination

    

    Landlord
and Tenant hereby agree that this Tenancy Agreement shall be terminated and the
Parties hereto shall not be responsible to each other in case of any of the
following events:

    
      
         

      

      
        - 19
-

        
          

        

      

      
         

      

    

    

    

    
      	
               
      

            	
              (1)

            	
              The
      land use right of the Premises is taken back before its expiration in
      accordance with relevant laws; or

            

    

    

    
      	
               
      

            	
              (2)

            	
              The
      Premises is expropriated for public interests or needs of urban
      construction in accordance with relevant laws;
  or

            

    

    

    
      	
               
      

            	
              (3)

            	
              The
      Premises is included in the area within which properties are to be
      demolished and residents are to be relocated according to laws due to
      requirements of the urban constructions;
or

            

    

    

    
      	
               
      

            	
              (4)

            	
              Not
      as a result of the behaviour non-performance of duty negligence of Tenant
      or its employee agent contractor invitee customer or visitor, the Premises
      is damaged, destroyed or verified as a dangerous building unit (if such
      damage or danger to the Premises can be recovered or repaired within
      ninety (90) days after the damage incurs or the danger is verified, this
      Tenancy Agreement shall not be terminated provided that Landlord shall not
      be obliged to reinstate the Premises);
or

            

    

    

    
      	
               
      

            	
              (5)

            	
              Tenant
      has been well informed by the Landlord that the Premises has been
      mortgaged, and the Premises is legally disposed of by the mortgagee during
      the Term; or

            

    

    

    
      	
               
      

            	
              (6)

            	
              This
      Tenancy Agreement cannot be performed continuously due to damage of the
      Premises or the Building, or the facilities thereof caused by a force
      majeure event (provided that if such damages to the Premises or the
      Building or the facilities thereof can be repaired within [one hundred and
      eighty (180)] days after the damage is incurred, this Tenancy Agreement
      shall not be terminated); or

            

    

    

    
      	
               
      

            	
              (7)

            	
              Not
      as a result of the act, fault or negligence of Tenant, any other event in
      which the tenancy is prohibited by laws and regulations occurs;
      or

            

    

    

    
      	
               
      

            	
              (8)

            	
              If
      Landlord wishes to sell, demolish, redevelop or refurbish the Building or
      any part affecting the Premises by giving at least six months' prior
      notice to Tenant.

            

    

    

    Clause 11 – Interpretation
and Miscellaneous

    

    11.1           (Headings
and indices) The headings and indices (if any) are intended for guidance
only and do not form part of this Tenancy Agreement nor shall any of the
provisions of this Tenancy Agreement be construed or interpreted by reference
thereto or in any way affected or limited thereby.

    

    11.2           (Condonation
not a waiver) 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
from time to time of any of the Tenant’s obligations herein contained shall
operate as a waiver of the Landlord’s rights 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

    
      
         

      

      
        - 20
-

        
          

        

      

      
         

      

    

    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 in no way shall
it 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.

    

    11.3           (Parking
spaces) In case Tenant needs parking spaces, it shall apply to Landlord
and subject to confirmation by Landlord, the parties shall enter into separate
licence agreement regarding relevant matters in relation to the usage of such
parking spaces.

    

    11.4  (Right of
first refusal) Before the Tenant enters into Tenancy Agreement, the
Landlord has informed the Tenant that the Premises has been
mortgaged.

    The
Tenant hereby expressly undertakes that unless otherwise consented by the
Landlord and the mortgagee in advance in writing, Tenant irrevocably and
unconditionally agree to waive the rights it may have to be given notice or the
right of first refusal to purchase the Premises when the Landlord is to sell, or
the mortgagee is to dispose of the Premises in other manner.

    

    11.5  (Sublet)
With the prior written consent from Landlord, Tenant may sublet all or part of
the Premises to a Tenant’s subsidiary company, Tenant’s actual-controlling
company or a subsidiary company of Tenant’s actual-controlling company (referred
to as the “Sub-Tenant”
hereinafter). In case of sublet of the Premises, such sublet should be in
compliance with the design of unit division of the Building. The Tenant and the
Sub-Tenant shall adopt the template agreement for sublet provided by the
Landlord and the sublet agreement shall be submitted to Landlord for review and
approval; otherwise, the Tenant shall not enter into any sublet agreement. A
copy of the agreement in respect of such sublet shall be submitted to Landlord
for its retention. The Landlord has right to charge for RMB2,000 as
administrative fee for each sublet. The costs incurred by such sublet (including
but not limited to Landlord’s administrative disbursements and the legal fees
for the legal services to be rendered in connection with the preparation of the
relevant documents regarding the sublet) shall all be borne by Tenant. Should
the income received by the Tenant in accordance with the sublet agreement exceed
the rental income received by the Landlord in accordance with this Tenancy
Agreement, the Landlord may be entitled to 50% of the difference between such
sublet income and the rental income it receives under this Tenancy
Agreement.

    

    11.6  (Assignment)
Without prior written consent by the Landlord, Tenant shall not assign underlet
or otherwise part with the possession of or transfer the Premises or any part
thereof or any interests therein nor permit or suffer any arrangement or
transaction whereby any person who is not a party to the Tenancy Agreement
obtains the use possession occupation or enjoyment of the Premises or any part
thereof irrespective of whether any rental or other consideration is given
therefore.

    

    11.7  (Renewal)
If Tenant desire to renew the tenancy of the Premises, Tenant should give
Landlord a written notice six (6) months prior to the expiration of the Term
(hereinafter referred to as the “Renewal Notice”). Landlord
will negotiate on the aforesaid renewal of the Premises with Tenant. The terms
and conditions in respect of the renewal of the Premises shall be that as may be
mutually agreed upon by both Landlord and Tenant. Unless otherwise agreed by the
parties, the Rent for each square meter of the Premises during the further
renewal lease term shall be the current Rent hereby provided or the open market
rental of

    
      
         

      

      
        - 21
-

        
          

        

      

      
         

      

    

    office
buildings of similar quality at the time when the renewal notice was received by
the Landlord, whichever is higher. Within thirty (30) days after the Renewal
Notice is issued, Tenant shall execute with Landlord a renewal lease agreement
in respect of the Premises (hereinafter referred to as “Renewal Tenancy
Agreement”).

    

    If Tenant
has not issued and delivered  the Renewal Notice to Landlord six (6)
months prior to the expiration of the Term, or the premises to be leased as
mentioned in the Renewal Notice are not all of the Premises, or the lease term
stipulated in the Renewal Notice is less than 24 months, or Tenant fails to
execute the Renewal Tenancy Agreement with Landlord pursuant to this Clause, or
the Tenant express in writing that it will not renew the lease, then Tenant
shall lose the right of renewal as stipulated in this Clause and Tenant shall be
deemed to have waived the first refusal to lease the Premises under the same
conditions.  Under such circumstance, Landlord shall be entitled to
negotiate with any other party to lease the Premises after the expiration of the
tenancy under this Tenancy Agreement and sign relevant tenancy agreement with
such other party.

    

    11.8  (Landlord's
rights regarding common areas and common facilities) The Landlord
reserves the right to remove cancel relocate or otherwise change or carry out
any alteration or addition or other works to the common areas and common
facilities of the Building and such other part or parts of the Building (other
than the Premises) and to restrict the access or rights of way thereof from time
to time and in such manner as the Landlord may in its absolute discretion deem
fit without the same constituting an actual or constructive eviction of the
Tenant and without incurring any liability whatsoever to the Tenant
therefor.

    

    
      	
              11.9

            	
              (Service
      of notices)

            

    

    

    
      	
               
      

            	
              11.9.1
      Any notice or communication to be given under or in connection with this
      Tenancy Agreement by the Parties hereto shall be given in writing to the
      following addresses, facsimile numbers and email
  addresses:

            

    

    

    
      	
              Landlord:

            	
              Bluewater
      Property Management Co., Ltd.

            

    

    
      	
              Attention:

            	
              Asset
      Manager

            

    

    
      	
               
      

            	
              Address:

            	
              27/F,
      Nexus Center, No.19A East 3rd
      Ring Rd North , Beijing, China.

            

    

    
      	
              Post
      Code:

            	
              100020

            

    

    
      	
              Telephone:

            	
              (86-10)
      5870-7788

            

    

    
      	
              Fax
      No.

            	
              :

            	
              (86-10)
      5870-7799

            

    

    
      	
              Email:

            	
              lily.lui@kailongrei.com

            

    

    

    
      	
              Tenant:

            	
                    Pacific
      Asia Petroleum

            

    

    
      	
              Attention:

            	
              Austina

            

    

    
      	
              Address

            	
              :

            	
              No.B-118
      Jiangguo Ave. The Exchange Building, Suite 1809.
  Beijing,

            

    

    
      	
               
      

            	
              Post
      Code:   100022

            

    

    
      	
               
      

            	
              Telephone:   010-65675587

            

    

    
      	
              Fax
      No.

            	
              :     010-65675508

            

    

    
      	
               
      

            	
              Email:      Austina-yan@papetroleum.cn

            

    

    

    
      	
               
      

            	
              or
      at such other address, facsimile number or email address as the party to
      whom such notice is to be given shall have last notified the party giving
      notice. Any notice delivered to the original address, facsimile number or
      email address by one party should be deemed properly delivered before the
      party giving notice receives
such

            

    

    
      
         

      

      
        - 22
-

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              notice
      on the change of address.

            

    

    

    
      	
               
      

            	
              11.9.2
      Any notice or communication shall be deemed to be received, in the case of
      a letter delivered by hand, at the time of delivery; or in the case of
      facsimile, on the completion of transmission; in the case of express
      delivery by post, 3 days after posting; or in the case of prepaid
      registered post, 5 days after posting; in case of electronic mail,
      delivery of such mail to the email system of the designated email
      address.

            

    

    

    
      	
               
      

            	
              11.9.3
      In addition to the notices and communications given pursuant to Clause
      11.9.1 and 11.9.2 of Appendix One, the Parties hereto agree that upon the
      take-over of the Premises by Tenant under this Tenancy Agreement, any
      notice to be given to Tenant shall be deemed as has been delivered to
      Tenant if it is addressed to Tenant and left at the Premises. The notice
      so delivered shall be deemed to be received by Tenant on the business day
      following the date of delivery.

            

    

    

    11.10                      (Exclusion
of warranties) This Tenancy Agreement sets out the full agreement reached
between the parties and supercedes all prior representations, agreements,
covenants or warranties. No other representations or warranties have been made
or given relating to the Landlord or the Tenant or the Building or the Premises
and if any such representation or warranty has been made given or implied the
same is hereby waived.

    

    11.11                      (Name of
Building) 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 compensation to the Tenant Provided that the Landlord shall give the
Tenant and the postal and other relevant government authorities not less than
one months notice of its intention so to do.

    

    11.12                      (Business
License)
Prior to signing this Tenancy Agreement, the Tenant shall produce to the
Landlord for inspection the business license or registration certificate issued
by the Government of the People’s Republic of China and the relevant Power of
Attorney and in case where the Tenant is a corporation, the by-laws or the
memorandum and articles of association of the Tenant and a certified copy of the
board minutes of the Tenant authorizing the Tenant’s representative to execute
this Tenancy Agreement.  Without prejudice to the foregoing, the
Tenant represents and warrants to the Landlord that it has all requisite power
and authority to execute and deliver this Tenancy Agreement and to perform its
obligations hereunder, and that the person signing this Tenancy Agreement on
behalf of the Tenant has been duly authorized to do so by all necessary
corporate or other action of the Tenant.

    

    11.13                      (Condition
of Premises) Subject to the execution of this Tenancy Agreement and
compliance with and performance of the terms and conditions under this Tenancy
Agreement by the Tenant, the Premises shall be delivered to the Tenant on “as
is” basis as of the date on which possession thereof shall be delivered to the
Tenant by the Landlord. The Tenant shall accept the Premises so delivered as
tenantable and in accordance with this Tenancy Agreement.

    

    11.14                      (Costs
and Expenses) Unless the laws and regulations of the People’s Republic of
China provide to the contrary in which event such contrary provisions shall
apply, all expenses including stamp duty for and incidental to the creation of
this Tenancy Agreement

    
      
         

      

      
        - 23
-

        
          

        

      

      
         

      

    

    shall be
borne equally by the Landlord and the Tenant. Each party shall bear its own
legal costs, if any.

    

    11.15                      (Confidentiality)
Information about the parties business, operation, finance, material schemes and
all of the provisions and stipulations contained in the Tenancy Agreement and
other documents in relation to the lease (if any) are all confidential. Without
prior consent of the other party, neither party shall disclose such information
or documents to any other party, excluding disclosure to its employees or agents
for the discussion, draft, execution, performance of the lease, or disclosure as
required by laws and regulations, or disclosure of relevant information by the
Landlord to its professional consultants in the areas of financial, financing,
accounting, audit, taxation, legal and engineering in connection with the
provision of such consultancy services; or disclosure according to this Tenancy
Agreement. Any party breaching the duty of confidentiality shall be fully liable
for the losses therefore incurred to the other party. Without prejudice to
abovementioned, the parties promise as follows: the Tenant promises to strictly
keep confidential the management information of the Landlord, the Rent, Property
Management Fee, Rent-free Period, etc. and keep strictly confidential any other
preferential treatment granted by Landlord to Tenant, and would not disclose to
any third party without prior permit by Landlord. The Landlord promises to keep
the information of Tenant confidential, and not to disclose to any other party
without prior consent by Tenant.

    

    11.16
(Governing
Law and Jurisdiction) This Tenancy Agreement shall be governed by and
construed in accordance with the laws of the People’s Republic of China. Any
disputes arising in connection with this Tenancy Agreement between the Parties
hereto shall be resolved through negotiation. For disputes that cannot be
resolved through negotiations within a reasonable time or one party has reason
to believe that the disputes would not be resolved by friendly negotiation,
either party shall be entitled to bring such dispute to the jurisdictional court
of the district where the Premises is located.

    

    

    11.17                      (Execution
and Language) This Tenancy Agreement shall be executed in Chinese version
in quadruplicate, with Landlord holding Three (3) original copies and Tenant
holding One (1) original copy. The English translation of this Tenancy
Agreement, if so provided by the Landlord, is for the Tenant’s reference
only.  The Landlord does not warrant or represent that the contents of
the English translation and the meaning conveyed by its wordings are the same as
the Chinese version.  In case of conflict and inconsistency, the
Chinese version shall prevail.

    
      
         

      

      
        - 24
-

        
          

        

      

      
         

      

    

    APPENDIX TWO – SPECIAL
CONDITIONS

    

    Unless
otherwise expressly agreed, if there is any inconsistency between the terms of
any part of this Tenancy Agreement with those of the Special Conditions, the
terms of the Special Conditions shall prevail.

    

    

    
      	
              1.

            	
              (Rent-free
      Period)

            

    

    

    
      	
              1.1.

            	
              Provided
      that the Tenant shall lease the Premises for the entire Term and observe
      each term and condition herein, the Landlord agrees to grant a Three (3)
      months Rent-free Period. During the Rent-free Period, Tenant is not
      obliged to pay the Rent, but shall pay the Property Management Fees and
      other fees as specified in this Tenancy Agreement. The Rent-free Period is
      the period herein below:

            

    

    

    Commencing
from August 1, 2010 and ending on August 31, 2010 (both days
inclusive);

    Commencing
from July 1, 2011 and ending on August 31, 2011 (both days inclusive). The
Rent-free Period shall not be suspended or extended unless for force majeure
events.

    

    
      	
              1.2.

            	
              If
      the actual period during which Tenant leases the Premises is shorter than
      the Term for whatever reasons, and/or if Tenant breaches any of the
      stipulations of this Tenancy Agreement, Landlord shall be entitled to
      claim against Tenant for all of the Rent exempted during the Rent-Free
      Period.

            

    

    
      
         

      

      
        - 25
-

        
          

        

      

      
         

      

    

    APPENDIX THREE: Floor
Plan(s)

    

    

    

    

    

    

    

    
      
         

      

      
        - 26
-

        
          

        

      

      
         

      

    

    APPENDIX
FOUR:                                                      Standard Delivery
Status

    

    The
Premises will be handed over to Party B in as-is condition with the
following

    provisions:

    

    10.1  600x600mm
acoustic ceiling tiles and grills material to be provided by Party
A

    and to be
installed by Party B at Party B’s own cost;

    10.2  600x1200
mm light fittings material to be provided by Party A and to be

    installed
by Party B at Party B’s own cost.;

    10.3  VAV
boxes, thermostatic controllers, air diffusers and return air
grilles;

    10.4  Complete
sprinkler system;

    10.5  Smoke
detection system;

    10.6  Off-white
paint walls and columns;

    10.7  Steel
raised floor;

    10.8  Double-glass
door with electrical locker;

    10.9  Fire
door.

    

    Party A
will hand over the Premises and above material with brand new and
undamaged

    conditions.
At handover Party A or their nominated representative, Party B and Party
B’s

    nominated
fitout contractor will inspect the area to be leased and sign a
handover

    document
detailing agreement on the condition of the premises at the Handover
Date

    along
with any items that need to be remedied by Party A subsequent to the
Handover

    Date.

    APPENDIX FIVE –ACKNOWLEDGEMENT BY
TENANT

    

    
      

    

    

    Tenant
hereby acknowledges the fact that the Premises have been mortgaged to the
Creditor (“Mortgagee”).
Tenant fully understands and accepts that its rights under the tenancy of the
Premises cannot act/protest against the Mortgagee’s rights as granted by PRC
laws. In case that the Premises is disposed/sold because of the Mortgagee’s
execution of his rights as an mortgagee, Tenant agrees to waive all of its legal
rights of being notified and the right of first refusal to purchase the
Premises.

    

    Notwithstanding
the above, Tenant agrees to lease the Premises in accordance with the terms and
conditions of this Tenancy Agreement.

    

    Acknowledged
and agreed by Tenant:

    

    

    __________________________________________________________
(Seal)

    Authorized
Representative:

    Title:

    Date:

    

    

    

    

    

    

    

    

    

    

    
      
         

      

      
        - 27
-

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