EXHIBIT 10.14.
LEASE AGREEMENT WITH BEIJING TONGKAI DEVELOPMENT CO., LTD.
FOR OFFICE SPACE IN BEIJING, CHINA
BEIJING TONGKAI DEVELOPMENT CO., LTD C
AND
CONTRACT OF LEASE
OF
UNIT 803, the_8th Floor
BEIJING SUNJOY MANSION
NO. 6, RI TIAN RD. CHAO YANG District, Beijing
February 28, 2000
LESSOR BEIJING TONGICAI DEVELOPMENT CO., LTD
(hereinafter called "Party A")
Business Registration No.: 1150428
Registered Office: No.6, Ritan Road, Chao Yang District, Beijing
Legal Representative: PengYi
Position: Chairman
Nationality: Chinese
Lessee; Beijing CathayOnline Technologies Co., Ltd.
(hereinafter called "Party B")
Business Registration No.:
Registered Offiee~
Legal Representative; Peter Chin
Position: General Manager
Nationality; U.S.
Party A is an enterprises with the status of a Chinese legal person and is the
developer of the building known as BEIJING SUNJOY MANSION ( HEREINAFTER CALLED"
THE BUILDING"), WHICH SITUATES at No. 6 Ri Tan PA, Chao Yang District, Beijing,
The People's Republic of China (hereinafter called "PRC"). Party A has agreed to
grant a lease and Party 13 has agreed to take a lease of part of the Building
and have made this Contract.
THIS CONTRACT IS MADE ON THE DAY OF (March 3, 2000] for the purpose of' defining
the rights and obligations of both parties, and through consultations, the
parties have agreed to observe and perform the following terms;
1. Premises
Pursuant to the terms and conditions hereinafter provided, Party B
shall TAKE A LEASE FROM PARTY A OF ALL THAT UNIT 803L, THE 11TH FLOOR
of Beijing SUNJOY Mansion to used as an office (hereinafter called "the
PREMISES"). THE LETTABLE AREA OF THE PREMISES SHALL BE (331.18 ] square
metres. For identification purpose, shown colored red on the plan
annexed as Schedule 1. Party B has no right to use the external wall of
the building.
Party B acknowledges that (1) Party B has inspected the Premises and
accepts the Premises in "as-is" condition and (2) Party A has made no
WARRANTIES AND I or representations regarding the conditions of the
Premises.
2. COMMENCEMENT DATE OF THE LEASE TERM
Lease created hereunder (hereinafter called "the lease") shall commence
on (May 1,2000]( hereinafter called the "Commencement Date")
3, TERM
THE LEASE SHALL BE FOR A TERRA OF (2] YEARS ,ENDING ON (APRIL 30,2000]
FROM AND INCLUDING THE COMMENCEMENT DATE ( hereinafter called "the
Term").
4. PRIORITY TO EXTEND LEASE
Three (3) months before the expiration of the Term, Party B can request
for extension of Lease in writing. Upon consultation and $ agreement by
both Parties on the new rent and the other conditions, the Term may be
extended for 1 year and the parties shall sign a Contract of Lease for
the extended period. If all other conditions are equal and Party B
shall net have committed any material breach of this Contract, Party B
shall have the first priority to sign a Contract of Lease FOR SUCH
EXTENDED PERIOD. PARTY B SHALL HAVE THE EXTENDING RIGHT FOR_ S times
and i..... year each time. If Party B is unable to reach an agreement
on the new rent and the other conditions with Party A three months
before the expiration of the Term, Party B shall be deemed to have
waived such right of priority and under such circumstances, even tt'
all other conditions are equal, Party A shall have the right to lease
the Premises to any third party or third parties.
5. RENT
5.01 PARTY FL SHALL PAY THE RENT EVERY QUARTER ( exclusive of all other fees
PAYABLE, HEREINAFTER CALLED THE "BASIC RENT" ). The total amount IS
US1J15~45~6ACL
5.02 The Basic Rent shall be payable quarterly in advance. Upon the signing
of this Contract, Party B shall forthwith pay the first Basic Rent
(equivalent to three month's Basic Rent) to Party A.
5.03 Except as provided in Clause, 5.02 hereof, seven (7) days before the
commencement of each quarter, upon receiving the written notice of
payment from the party A, Party B shall pay in advance without any
deduction whatsoever the BASIC RENT FOR THE FOLLOWING QUARTER TO PARTY
A within [7 Idays. Should such payment date fall on a Saturday, Sunday
or a public holiday in the PRC, then the payment due shall be postponed
to the immediate next working day thereof.
5.04 If the Term of this Contract does not commence on the first day of a
month ,thc Basic Rent for the first and last month of the Term shall be
pro-rated according to the actual number of days of the month concerned
(one month should be calculated on 30 days basis).
5.05 Tn the event that the Term here ot' exceeds two (2) years, Party A
shall reserve the right to i~icrease the rent every year ever since the
third year. $
6, BUILDIN~MANAGPJNENT FEE
6.01 Party B shall pay the mot~thly Building Management fee. The Building
Management FEE SHALL B~ USD (3.50) PER square meter per month making a
total of USD (1459.13 ]PER MONTH. PARTY A OR THE MANAGEMENT COMPANY
APPOINTED BY PARTY A ( HEREINAFTER CALLED "THE MANAGEMENT COMPANY" )
shall have t$e right to determine and adjust the Building Management
Fee. Such i~icrease shall be based on the increase of the actual costs
of elecfricit~ and water. In case of an ADJUSTMENT, PARTY A AND I or
the Management ~ompany shall notify Party B at least one (1) month
before such adjustrn~ent. $
6.02 UPON THE SIGNING OF THE CONTRACT, Party B shall forthwith pay the
FIRSTQUARTERLY $ BUILDING MANAGEMENT FCC ( equivalent to three (3)
months' Building Management Fee) by cash, cashier's order or wire
TRANSFER, THE TOTAL AMOUNT IS USD 3,477.39
6.03 SEVEN (7) DAYS BEFORE THE COMMENCEMENT OF EACH QUARTER, UPON U
receiving the written notice of payment from the Management coinpiny,
Party B shall at the time of advancing the payment of Basic Rent, pay
in advance the Building Management Fee for the following quarter within
[73 days. Should such payment date fall on a Saturday, Sunday or a
public holiday in the PRC, then the L' payment due shall be postponed
to the immediate next working day thereof.
6.04 Throughout the Term, should the Building Management Fee payable be less
than three months, such fee shall be pro-rated according to the ACTUAL
NUMBER OF DAYS THE MONTH CONCERNED ( one month should be calculated on
30 days basis),
6.05 Party B shall not be entitled to deduct any sum from the Building
Management Fee.
6.06 The Building Management Fee refetnd to in Clause 6.01 herein above
shaft include the following expenses of Party A or the Management $
Company appointed by Party A:
1. the cost of cleaning the public areas and facilities;
2. the cost of illuminating the public areas and the provision of
signboards and light-fittings of the Building;
3. the cost of repairing and maintaining the access ways and
public areas;
4. the cost of repairing, maintaining and replacing the security,
fire-fighting, electrical appliances, transformer, gas,
sewage, at rconditioning systems,' elevator, lifts and other
facilities of the Building.
5. the remuneration and expenses in relation to the provision of
management, security, planting of greeneiy, cleaning or other
services;
6. the water, hot water, electricity, air-conditioning and
heating charges of the public areas, and air-conditioning,
heating charges in the Premises;
7. THE DISPOSAL OF GARBAGE AND WASTE MATERIAL ( except chemical
biological and electronic wastes);
8. the cost of using and maintaining the mechanical instruments
of the Building;
9. the cost of the Building's management - related financial and
legal consultants;
10. the service charge of Party A or the Management Company
appointed by Party A;
11. the cost of insurance of the public areas of the Building, and
insurance OF LABOR OF THE MANAGEMENT COMPANY ( excepted in
respect of the Lessee's own assets);
12. all other expenses in relation to the Building. $
7. CARR PARKS AND OTHER PUBLIC FACILITIES IN THE BUILDING
7.01 Party13 rent..uncovered fixing Car Park which is USD40 each month,
____indoor fixing Car Park which is USD80 each month.
7.02 Party B rent the 8 direct lines, which is USD30 rental per line per
month, Party A shall transfer the ownership to Party B temporarily Li
until the termination of the Lease for the purpose of a direct
telephone fee settlement with the Telephone Bureau. Party B shall pay
the charge of the transfer. Otherwise, Party B shall pay 10% of the
telephone fee to Party A as service charge.
7.03 PARTY B SHALL PAY SUCH ELECTRICITY CHARGES TO PARTY A as specified in
the bill tendered by Party A or the Management Company each month. The
charge is charged according to the actual cost and shall increase
whenever the relevant authority adjusts the rate.
8. RENT DEPOSIT AND BUIJDJNGMANAGC~~NANT PEE PFLQSIT
8.01 The Rental Deposit shall be equivalent to three (3) months' Basic Rent
of the Premises. On signing of this Contract or upon the submission of
fitting out PLAN TO PARTY A AND I or the management Company (whichever
is the earlier), Party B shall pay by cash, cashier's order or $WIRE
TRANSFER TO PARTY A A SUM EQUIVALENT TO THREE (~) MONTHS0 Basic Rent IT
(WHICH SHALT INCLUDE ALL RENTAL DEPOSITS ALREADY PAID TO PARTY A ) as
the Rental Deposit.
8.02 The Building Management Pee Deposit shall be equivalent to three (3)
months' Building Management Pee. On signing of this Contract or upon
the submission of fitting out plan to Party A and / or the MANAGEMENT
COMPANY ( whichever is the earlier), Party B shall pay by cash,
cashier's order or wire TRANSFER TO PARTY A A SUM EQUAL TO THREE (3)
MONTHS' BUILDING MANAGEMENT PEE ( which shall include ALL MANAGEMENT
FEE DEPOSITS ALREADY PAID ) as the Building Management Fee Deposit.
8.03 Should Party B be in breach of this Contract (including but without
limitation the regulations on RENTAL PAYMENT ), Party A may use or
deduct all or part of the deposits, the amount shall be equal to the
amounts due to Party B. Should the amount of the Rental Deposit be
insufficient due to the deduction by Party A according to the Contract
or other reasons, Party B shall forthwith on demand of Party A pay to
Party A a further deposit in such insufficiont sum.
8.04 At the expiration of the Term of the Lease, after Party B have
delivered up vacant possession of the Premises to Party A and have paid
all rents $and all other sums due hereunder and after Party B have
compensated Party A of all damages suffered as a result of any breach
of the terms HEREIN CONTAINED, PARTY A SHALL REFUND ALL DEPOSITS (
without interests or compensation) to Party B within thirty (30) days.
9. MAN RJER OF PAYMENT
9.01 Unless approved by Party A in writing, the Basic Rent, Building
Management Fee, all deposits and other fees and charges payable $under
this Contract shall be counted in USD and paid in USD or RMB $using the
average of buying and selling exchange rates published by the People's
Bank of China on the date of payment. The place of payment and the bank
account number for payment shall be determined by Party A.
9.02 Unless otherwise provided in this Contract, upon receiving the written
NOTICE OF payment from the management company, if Party B shall for any
reason whatsoever fail to make or delay in making payment of any of the
sums payable, Party A shalt have the right to impose a surcharge on a
DAILY BASIS AT THE RATE OF 0.5% of the amount of such sums payable.
Should Party B fail to make payment for more than seven (7) days, Party
A shall have the right as if there is a breach of Clause 10.05 hereof.
10. RIGHT AND OBLIGATIONT OF PARTY A
10.01 PARTY A WARRANTS THAT PARTY A is the only landlord who is authorized
and legalized to lease the Premises.
10.02 Party A or the Management Company appointed by Party A shall be
responsible for the management of the Building and shall, with
compensation from Party B, provided the following services and
facilities; water, electricity, illumination, air-conditioning,
heating, telephone, car parking, washroom and other necessary business
facilities. Party A shall not be liable to damages or otherwise if the
above services shall be interrupted by fire, accident, act of Clod, the
making of necessary repairs or improvements, or by any causes beyond
Party A's control.
10.03 Party A shall, with compensation from Party B, be responsible for the
security and fire fighting systems in the Building and the cleaning of
the public areas therein.
10.04 Party A reserves the following rights:
10.04.01 in respect of the public facilities in the Building~ the flee
passage and running of the public facilities such as water,
electricity, gas, communication and other services in the
Premises; Party A or the Management Company shall have the
right, BY GIVING PRIOR NOTICE TO PARTY B ( except in case of
emergency), to authorize its staff to enter into the Premises
for the purpose of carrying out investigation, repair or
reconstruction worki of the public facilities in the Building;
and $
10.04.02 except in case of emergency, upon reasonable notice being
given, Party A or the Management Company shall have the right
to temporarily suspend any facilities in the building for the
purpose of carrying out repair works.
10.05 In the event of the occurrence of any of the following events in
relation to PARTY B. PARTY A shall have the right to unilaterally
rescind this Contract;
10.05.01 any breach of the laws or regulations of the MC or curry on
any illegal activity. $
10.05.02 any change in~the usage of the Premises;
10.05.03 THE USE OF ANY NAME OTHER THAN I: Beijing CathayOnline
Technologies Co., Ltd. ] to carry on business jn the Premises;
10.05.04 the failure to pay the Basic Rent, Building Management Fee in
accordance with Clauses S AND 6 HEREOF OR THE FAILURE TO PAY
THE RENTAL DEPOSIT AND I or Building Management Fee Deposit in
accordance with Clause S hereof or the failure to pay the
surcharge in time in accordance with CLause 9.02 hereof or the
non-payment of the charges provided in Clauses 7.01, 7.02 and
7.03 hereof, for more than seven (7) days after the same is
due; or
10.05.05 without the approval in writing of Party A, to turn over,
sublease, assign, transfer or share with any third party the
use of the Premises or any part thereof.
10.06 At any time within the three (3) months before the expiration of the
Term, Party A together within any prospective lessee of the Premises
shall have the right to enter into and view the Premises.
10.07 Under no circumstances whatsoever shall Party A become liable to Party
B or any other person claiming through Party B in respect of any loss
or damage to property or loss of business or trade or profit of any
nature or any other liability including but without limitation
liability caused by any interruption of any of the services or
facilities or supply of electricity, telecommunication services; any
act of any kind arising from any of the lessees or users of any other
part of the Building; any typhoon, earthquake, landslide, storm, escape
of fire, leakage of water or electric current. Party A shall not take
any responsibility to Party B or any other person claiming through
Party B in respect of a personal injury, on the condition that the same
is not due to Party A's intentional act.
10.08 In the event the Premises are damaged or destroye,d by casualty insured
under a policy as issued from time to time and the Premises are
rendered partially or totally untenantable as a result of such
casualty, then to the extent the Premises are rendered untenantable,
the Basic Rent and Building Management Fee shall be proportionately
abated until the Premises are restored to the condition in which it was
immediately prior TO THE HAPPENING OF SUCH CASUALTY ( except for the
items Party 13 is $ responSible to repair or replace).
11. RIGHTS AND OHLIGATIONS OF PARTY 8
11.01 SUBJECT TO Party B paying the Basic Rent and all other sums payable by
Party B under this Contract on the days and inmanner herein provided
for payment of this same and observing and performing the obligations
and conditions herein contained and on Party B's part to be observed
and performed, Party B shall hold and enjoy the Premises during the
Tern'.
11.02 Party B shall have the right to reasonably use the public areas and
facilities of the Building and shall bear the cost related thereto
provided that Party A or the Management Company shall have the right to
impose reasonable restrictions toward such use and Party B shall not
raise any objection.
11.03 Party B shall punctually pay the Basic Rent, Building Management Fee,
electricity, telephone and other charges and all expenses relating to
its use of the Premises.
11.04 Party B shall be responsible for keeping all the interior of the
Premises in a clean and good condition and shall on a regular basis
carry our repair arid cleaning works including but not limited to the
floor, walls, ceiling ARID ALL FIXTURES SUCH as all windows, doors,
electrical wiring and installations, furniture and sanitary apparatus.
11.05 Party B shall forthwith give notice to Party A or the Management
Company of any damage to the Premises and Party B shall promptly take
all appropriate measures to prevent the Premises from damages by
typhoon or other natural calamities.
11.06 Party B shall carry out the repair for which Party B is liable within
one month upon receipt of notice in writing to repair from Party A or
the Management Company. If Party B shall fail to execute such repair in
accordance with the direction of Party A or the Management Company,
Party A or the Management Company shall have the right to enter the
Premises to carry out such repairs, and all loss or $ costs arising
there from shall be borne by Party B.
11.07 At the termination of' the Term of the lease, Party B shall deliver up
vacant possession of the Premises to Party A and shall at its own
expenses restore che Premises to its original condition.
11.08 The infestation work of the Building shall be organized by Party A, the
cost of which shall be shared among all the lessees of the Building
according to the area leased. Party B shall take reasonable measures to
insure that the Premises shall be free from infestation by pest.
11.09 Party B shall be wholly responsible for the safety of all the property
within the Premises including but without limitation all furnkure,
fixtures and fittings (whether belonging to Party A or Party B), goods,
chattels, samples, personal effects, contents and stock and to effect
with an insurance company.
11.10 Party B shall strictly observe and perform all management regulations,
introduced by Party A or the Management Company. All business
activities carried out by Party B in the Premises shall comply with the
laws and regulations of the Municipal Government of Beijing and MC.
11.11Party B shall be entitled to a rent free period for the purpose of
fitting out the Premises (60] days before the Commencement Date. In the
rent free period only rant is waived ,the management fee shall be paid
still.
11.12 Without the written consent of !--t3' A and the approval by the
relevant authority, Party B shall not install any additional locks or
security systems in the doors of the Premises and shall not alter the
original locks and the security system. if such alteration is required,
Party B shall apply in writing.
11.13 Except with the written consent. of Party A, Party B shall not transfer
or SUB - lease the Premises in whole or in part or in any manner
whatsoever $share the use thereof in common or joint1y with any third
part Party B's obligation under this Contract shall not in any event be
reduced or $excepted.
11.14 Party B shall be responsible for the act of its employees, customers,
visitors, worker or contractors for fitting out and decoration works
and shall bear the liabilities to compensate the losses suffered by
Party A and I or any third party by reason of such act of such person.
12. PARTY B'S DPCORATION AND FITTIUTOUR WORK
Any design of fitting out and decoration work need the agreement of the
management company.
13, ARERTNINATION OF CONTRNET
13.01 in the event of the occurrence of any of the events set out in Clause
10.05 hereof, Party A shall have the right, without making any
compensation to Party B, to unilaterally terminate this Contract.
13.02 If Paijy B shall be in breach of any obligation or responsibilities [
provided in Clause 11 here of and shall fail to remedy such breach
within seven (7) day upon notice by Party A or the Management Company,
Party A shall have the right to unilaterally terminate this Contract
and may b~ L claim against Party B for all cost incurred or loss
suffered as a result of Party B's breach.
13.03 The party encountering the force majeure shall have the right to
terminate this Contract upon the happening of the force majeure
referred to in [ Clause 14 hereof which renders it impossible for the
obligations in this Contract to be performed. $
14 FORCE MGJCIIRE
In the event of earthquake, typhoon, storm, fire or other unpredictable
force majeure the happening or consequence of which shill not be
prevented or avoided, the party encountering the force majeure shall
Lii FORTHWITH GIVE notice by telex or fax to the other parties and
shall within iS days provide the other parties with details of the
force majeure a [ documentary evidence proving the reason for not being
able to perform part or whole of obligations provided in this Contract
or having to delay the performance of such obligations. Such
documentary evidence shall be issued by the natural authority located
where the force majeure occurred, In such case, the party affected by
the force inajeure shall not be responsible for any consequence arising
from such force majeure.
15. LIABILITY FHR BREACH OF CONTRACT
15.01 Except as provided in Clause 13 hereof, neither party hereto may
unilaterally terminate this Contract. Any party izi breach of this
Contract SHALL COMPENSATE THE OTHER PARTY FOR ALL THE ECONOMIC LOSSES (
including LEGAL COSTS ) arising out of such breach. If it is due to the
fault of both parties, both parties shall be liable for the breach of
contract according to the actual situation.
15.02 If Party 13 shall be in breach of the contract, Party. A shall have the
right, in addition to unilaterally terminate this Contract, to deduct
from the Rental Deposit, Building Management Eec Deposit and other
deposits an amount equivalent to the loss suffered and expenses
incurred, Party A
shall also have the additional right to distrait Party B's facilities
and goods in the Premises.
15.03 Party A reserves the right with seven (7) days' prior written notice to
Party 13 to cut off and discontinue the services without liability to
Party B. whenever and during any period in which bills fer the same $
remain UNPAID BY PARTY 13. THE COSTS OF RE-SUPPLYING ( such as
reconnecting the ELECTRICITY SUPPLY AND ,` OR TELEPHONE SERVICES ETC. )
shall be borne by Party B.
16. WAIVER OF RIGHTS
The acceptance of rent by Party A after the knowledge of the occurrence
Liof a breach of contract shall not be deemed to $ operate as a waiver
by Party A of any right to proceed against Party 13. The waiver of any
right in this Contract by Party A shall not have effect unless such
waiver is Limade in writing. Acceptance of any rent or other payments
which is less than the amount that should be payable by Party B shall
not be deemed to operate as an acceptance by Party A of such under
payment by Party B nor shall it affect Party A's right to claim against
Party B for the amount due or Party A's right to proceed against Party
B pursuant to this Contract or any law or regulation.
17. DISPUTE RESOLUTION
17.01 The making validity, interpretation, performance and dispute resolution
L in respect of this Contract shailbe governed by PRC Law. fl 17.02 Any
dispute between Party A and Party B arising from this Contract shaf 1
Li be settled through friendly negotiation, consultation
andconcitiation. In r case the dispute can not be settled in the
aforesaid manner, either party Li may apply to the China International
Economic and Trade Arbitration Commission in Beijing for arbitration.
The result of the arbitration shall be final and binding on both
parties.
18. LEGAL
18.01 Party B shall be solely responsible for the fees of notarization and
other incidental procedures of this Contract and any other expenses
(including BUT NOT LIMITED TAXES ) which shall be payable by Party 13
pursuant to the laws of the PRC.
18.02 Except as provided in Clause 18.01 hereof, each party shall bear its
own
legal costs and other incidental costs arising out of the negotiation.
preparation and completion of this Contract.
19. ADDITIONAL CONDITIONS
19.01 If at any time, any provision hereof is or becomes invalid, illegal or
unenforceable in any respect, neither the validity, legality or
enforceability of the remaining provisions hereof shall in anyway be
affected or impaired thereby. Both parties shall continue to perfbrm
the remaining provisions hereof.
19.02 All notice in writing in connection with this Contract shall be sent by
registered post or served by person to the registered office or the
last known place of business of the other party. Unless otherwise
specified in such notice, the effective date of such notice shall be
the date of such posting or the date of such services as the case may
be
19.03 This Contract is given in Chinese and English languages. The EngLish
language is only a translation of the Chinese text and in the event of
any differences of conflict between the Chinese text and the English
translation; the Chinese text shall always prevail. Both version shall
be signed in two (2)copies, each party shall have one(1) Chinese and
one(l) English versions respectively.
19.04 This Contract shall be effective upon the signing and sealing by both
Party A and Party B. 19.05 This Contract is signed in Beijing,
The lessor The Lessee
Beijing Tongkai Development Co., Ltd. Beijing CathayOnline Technologies
CO., LTD.
(Seal)