JASO » Topics » Lease Agreements for Ningjin Facilities

This excerpt taken from the JASO 20-F filed May 9, 2008.

Lease Agreements for Ningjin Facilities

We lease from Jinglong Group approximately 25,000 square meters of land and space that are used as offices, dormitories and manufacturing center for our first three manufacturing lines in Ningjin, Hebei, with an annual rental of RMB 1,800,000. The related operating lease will expire in 2010.

In June 2007, we entered into another lease agreement with Jinglong Group, under which Jinglong Group agreed to lease to us approximately 8,000 square meters of land and space to house our other four manufacturing lines for a term of four years starting from June 1, 2007.

We plan to enter into another lease agreement with Jinglong Group for our new manufacturing center in Ningjin that will house our ten additional manufacturing lines currently being installed. We plan to finalize this new lease on terms substantially similar to our existing leases with Jinglong Group in May 2008.

In addition, we have an agreement with Jinglong Group to pay management fees of RMB 20,000 per month for facilities maintenance and security services provided by Jinglong Group. The term of this agreement was from April 2006 to December 2007 and has become renewable annually after December 2007. In January 2008, we renewed this agreement with Jinglong Group for a term from January 2008 to December 2008.

 

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