APPENDIX III PROPERTY VALUATION
The following is the text of a letter with the summary of values and valuation certificate received from CB Richard Ellis Limited, prepared for the purpose of incorporation in the prospectus, in connection with their valuation as at 31 October 2010 of all the property interests of the Group.
4/F Three Exchange Square 8 Connaught Place Central, Hong Kong T 852 2820 2800 F 852 2810 0830 香港中環康樂廣場八號交易廣場第三期四樓 電話 852 2820 2800 傳真 852 2810 0830 www.cbre.com.hk
地產代理（公司）牌照號碼 Estate Agent’s Licence No: C-004065
15 December 2010
The Board of Directors, China Animal Healthcare Ltd., No. 6 Kangding Street, Yi Zhuang Economic Development Zone, Beijing City, the People’s Republic of China
Dear Sirs,
In accordance with your instructions for us to value the property interests held by China Animal Healthcare Ltd. (the ‘‘Company’’) and its subsidiaries (hereinafter together know as the ‘‘Group’’)inthePeople’s Republic of China (the ‘‘PRC’’). We confirm that we have carried out inspections, made relevant enquiries and obtained such further information as we consider necessary for the purpose of providing you with our opinion of the capital values of such property interests as at 31 October 2010 (the ‘‘date of valuation’’).
Our valuation is our opinion of Market Value which is defined to mean ‘‘the estimated amount for which a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion.’’
Unless otherwise stated, our valuation is prepared in accordance with the ‘‘First Edition of The HKIS Valuation Standards on Properties’’ published by The Hong Kong Institute of Surveyors (‘‘HKIS’’). We have also complied with all the requirements contained in Paragraph 46 of Schedule 3 of the Companies Ordinance (Cap. 32), Chapter 5, Practice Note 12 and Practice Note 16 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the ‘‘Listing Rules’’).
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Our valuation has been made on the assumption that the owner sells the properties on the open market without the benefit or burden of a deferred term contract, leaseback, joint venture, management agreement or any similar arrangement, which would serve to affect the values of the property interests.
Unless otherwise stated, all the property interests are valued by the comparison method on the assumption that each property can be sold with the benefit of vacant possession. Comparison is based on prices realized on actual transactions or asking prices of comparable properties. Comparable properties with similar sizes, character and locations are analyzed, and carefully weighted against all respective advantages and disadvantages of each property in order to arrive at a fair comparison of value.
In valuing the property interests in Group I, which are held by the Group for occupation and development in the PRC, we have valued each of these property interests by the direct comparison approach assuming sale of each of these property interests in its existing state with the benefit of vacant possession and by making reference to comparable sales transactions as available in the relevant market.
For the property interests in Group II which are rented by the Group in the PRC, are considered to have no commercial value due mainly to the prohibition against assignment or sub- letting or otherwise due to the lack of substantial profit rent.
In the course of our valuation for the property interests in the PRC, we have relied on the legal opinion provided by Group’s PRC Legal Adviser, Jingtian & Gongcheng Law Firm (the ‘‘PRC Legal Opinion’’). We have been provided with extracts from title documents relating to such property interests. We have not, however, searchedtheoriginaldocumentsto verify ownership or existence of any amendment which does not appear on the copies handed to us. All documents have been used for reference only.
We have relied to a considerable extent on the information given by the Company, in particular, but not limited to, the sales records, planning approvals, statutory notices, easements, tenancies and floor areas. No on-site measurement has been taken. Dimensions, measurements and areas included in the valuation certificates are only approximations. We have taken every reasonable care both during inspecting the information provided to us and in making relevant enquiries. We have no reason to doubt the truth and accuracy of the information provided to us by the Company, which is material to the valuation. We were also advised by the Group that no material facts have been omitted from the information provided to us.
We have inspected the properties to such extent as for the purpose of this valuation. In the course of our inspection, we did not notice any serious defects. However, we have not carried out any structural survey nor any tests were made on the building services. Therefore, we are not able to report whether the properties are free of rot, infestation or any other structural defects. We have not carried out investigations on the site to determine the suitability of the ground conditions and the services etc. for any future development.
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No allowance has been made in our valuation for any charges, mortgages or amounts owing on the property interests nor for any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the property interests are free from encumbrances, restrictions and outgoing of an onerous nature which could affect their values.
Unless otherwise stated, all monetary amounts are stated in Renminbi (‘‘RMB’’).
We enclose herewith a summary of valuation and our valuation certificate.
Yours faithfully, For and on behalf of CB Richard Ellis Limited Leo MY Lo Director Valuation & Advisory Services
Note: Mr. Leo MY Lo is a member of Royal Institution of Chartered Surveyors, a member of the Hong Kong Institute of Surveyors. He has over 7 years’ valuation experience in the PRC and Hong Kong.
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SUMMARY OF VALUES
Capital Value Capital Value in Interests attributable to the existing state as at attributable to the Group as at Property Interests 31 October 2010 Group 31 October 2010 (RMB) (RMB)
Group I — Property interests held by the Group for occupation and development in the PRC
1. An industrial complex located at Bei 64,700,000 60% 38,820,000 Si Street, Shengle Economic Park, Helinger County, Hohhot City, Inner Mongolia Autonomous Region, the PRC
2. An industrial complex located at the 34,000,000 72% 24,480,000 south of Shanxi Agricultural University, Taigu County, Jinzhong City, Shanxi Province, the PRC
Group I Sub-total: 63,300,000
Group II — Property interests rented by the Group in the PRC
3. Part of Blocks 6 and 7, No commercial value No. 6 Kangding Street, Yi Zhuang Economic Development Zone, Beijing City, the PRC
4. An industrial complex, No commercial value No. 148 Yanshan Road, Shijiazhuang Hi-Tech Industrial Development Zone, Shijiazhuang City, Hebei Province, the PRC
5. An industrial complex, Wei’er Road, No commercial value Gongye Cheng, Shenzhou City, Hebei Province, the PRC
6. 7 rented properties located No commercial value in Shenyang City, Hefei City and Chengdu City, the PRC
GroupIISub-total: Nocommercialvalue
Grand total: 63,300,000
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VALUATION CERTIFICATE
Group I — Property interests held by the Group for occupation and development in the PRC
Capital value in existing state as at Property Description and tenure Details of occupancy 31 October 2010 (RMB)
1. An industrial complex The property comprises various PhaseIofthepropertyis 64,700,000 located at Bei Si workshops, offices, facilities with a total currently occupied by the (60% interests Street, Shengle g.f.a. of approximately 20,368.02 sq.m. Group as factory while attributable to the Economic Park, occupying on a site with an area of Phase II of the property is Group: Helinger County, approximately 135,860 sq.m. (the a parcel of vacant land. RMB38,820,000) Hohhot City, ‘‘Site’’). Inner Mongolia Autonomous Region, As advised by the Group, the the PRC development will comprise various workshops, offices, facilities with a total g.f.a. of approximately 62,604.62 sq.m. by two phases. Phase 1 is currently completed and Phase 2 is a parcel of vacant land.
PhaseIofthepropertywascompleted in February 2010.
The land use rights of the property are held under one State-owned Land Use Rights Certificate with a land use term expiring on 31 May 2059 for industrial use.
Notes:
a) Pursuant to the Contract entered into between People’s Government of Helinger County and Inner Mongolia Bigvet Biotech Co., Ltd (內蒙古必威安泰生物科技有限公司), dated 10 July 2008, the land use rights of the site with an area of approximately 135,860 sq.m. have been granted to the Group at a total consideration of RMB6,113,700.
b) Pursuant to the State-owned Land Use Rights Certificate He Lin Ge Er (2009) Guo Yong Zi No.0000319 dated 3 December 2009 issued by People’s Government of Helinger County, the land use rights of the site with an area of approximately 135,860 sq.m. have been granted to Inner Mongolia Bigvet Biotech Co., Ltd (內蒙古必威 安泰生物科技有限公司) for industrial use with a land use term expiring on 31 May 2059.
c) Pursuant to the Real Estate Title Certificate Fang Quan Zheng Meng Zi N0.183021001672 dated 8 February 2010 issued by People’s Government of Helinger County, the building ownership of the property with a total g.f.a. of approximately 20,368.62 sq.m. has been granted to Inner Mongolia Bigvet Biotech Co., Ltd (內蒙古必 威安泰生物科技有限公司).
d) The apportioned value breakdown of the property is RMB8,200,000 for land portion and RMB 56,500,000 for building portion, respectively.
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e) We have been provided with a legal opinion on the property prepared by the Group’slegaladviser,which contains, inter alia, the following information:
i) The State-owned Land Use Rights Certificate and the Real Estate Title Certificate owned by the Group are legal and valid.
ii) The Group legally owns 5 buildings located in the Shengle Economic Park, Helinger County, with a g.f.a. of 4,261.24 sq.m., 6,609.1 sq.m., 9,172.59 sq.m., 42.71 sq.m. and 282.98 sq.m., respectively. The Group is entitled to occupy, use, lease, transfer, mortgage or otherwise dispose of the property in accordance with the Real Estate Title Certificate and the PRC law.
iii) According to the State-owned Land Use Rights Certificate, the Group legally owns the land use rights of a parcel of industrial land with a site area of 135,860 sq.m. with expiry date on 31 May 2059.
iv) As far as we know, the aforesaid buildings and land use rights are not subject to any mortgage which shall be registered according to the PRC laws.
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VALUATION CERTIFICATE
Capital value in existing state as at Property Description and tenure Details of occupancy 31 October 2010 (RMB)
2. An industrial complex The property comprises various The property is currently 34,000,000 located at the south of workshops, offices, facilities and a occupied by the Group as (72% interests Shanxi Agricultural newly built building with a total g.f.a. of factory. attributable to the University, approximately 15,497.06 sq.m. Group: Taigu County, occupying on a site with an area of RMB24,480,000) Jinzhong City, Shanxi approximately 52,367.51 sq.m. (the Province, the PRC ‘‘Site’’).
The property was completed from 1970’s to 2004.
The land use rights of the property are held under one State-owned Land Use Rights Certificate with a land use term expiring on 16 September 2053 for industrial use.
Notes:
a) Pursuant to the State-owned Land Use Rights Certificate Tai Guo Yong (2004) No. 676 dated 16 November 2004 issued by People’s Government of Taigu County, the land use rights of the site with an area of approximately 52,367.51 sq.m. have been granted to Shanxi Luckier bio-pharmacy Co., Ltd (山西隆克爾生物製 藥有限公司) for industrial use with a land use term expiring on 16 September 2053.
b) Pursuant to the following Building Ownership Certificates issued by People’s Government of Taigu County, the building ownerships with a total g.f.a. of approximately 15,119.98 sq.m. have been granted to the Group.
Unit No. Building Ownership Certificate Number Gross Floor Area (sq.m.)
1 Fang Quan Zheng Tai Quan Zheng 1,152.48 2 ZiDiNo.09062 6,301.68 1 Fang Quan Zheng Tai Quan Zheng 282.75 2 ZiDiNo.09063 7,383.07
Total: 15,119.98
c) As advised by the Company, 3 blocks of buildings of the property with a total g.f.a. of approximately 462.92 sq.m. have been demolished.
d) As advised by the Company, a newly built building with a total g.f.a. of approximately 840 sq.m. of the property was erected on the location of demolished buildings as mentioned in note c) above. Had the Group obtained the Building Ownership Certificate of this portion, the capital value of the property in its existing state as at 31 October 2010 was in the sum of RMB 34,300,000 (72% interests attributable to the Group: RMB24,696,000).
e) We have been provided with a legal opinion on the property prepared by the Group’slegaladviser,which contains, inter alia, the following information:
i) The State-owned Land Use Rights Certificate and the Real Estate Title Certificates No. 09062 and No.09063 owned by the Group are legal and valid.
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ii) AccordingtotheRealEstateTitleCertificateNo.09062andtheexplanationbytheGroup,thebuildings with a g.f.a. of 1,152.48 sq.m. in brick structure and 6,301.68 sq.m. in mixed structure, excluding demolished buildings with a g.f.a. of 462.92sq.m. are legally owned by the Group. The Group is entitled to occupy, use, lease, transfer, mortgage and otherwise dispose of the property in accordance with the Real Estate Title Certificate No.09062 and the PRC law.
iii) According to the Real Estate Title Certificates No. 09062, the Group legally owns the buildings with a g.f.a. of 282.75 sq.m. in simple structure and 7,383.07 sq.m. in mixed structure. The Group is entitled to occupy, use, lease, transit, mortgage and otherwise dispose of the property in accordance with the Real Estate Title Certificate No. 09063 and the PRC laws.
iv) According to the State-owned Land Use Rights Certificate and the Testimonial issued by Land Resource Bureau of Taigu County on 30 July 2010, the Group legally owns the land use rights of a parcel of industrial land granted with a site area of 52,367.51 sq.m. with expiry date on 16 September 2053.
v) As far as we know, the aforesaid buildings and land use rights are not subject to any mortgage which shall be registered according to the PRC laws.
vi) Regarding the buildings without Real Estate Title Certificates, the Group legally owns the State-owned Land Use Rights Certificate whist the Group hasn’t provided any planning, construction and environment permits, etc. and acceptance documents issued by relevant government authorities. Therefore, the government has the right to request demolishing them or punish the Group under the PRCLaw.TheGroupisentitledtooccupy,use,lease,transfer,mortgageorotherwisedisposeofthe property provided that the relevant permits, registration and the Real Estate Title Certificate is obtained.
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VALUATION CERTIFICATE
Group II — Property interests rented by the Group in the PRC
Capital value in existing state as at Property Description and tenure Details of occupancy 31 October 2010 (RMB)
3. Part of Blocks 6 and 7, The development comprises two blocks The property is currently No commercial value No. 6 Kangding of industrial buildings (namely Block 6 occupied by the Group as Street, and Block 7) with a total g.f.a. of office and dormitory. Yi Zhuang Economic approximately 16,433.41 sq.m. Development Zone, occupying on a site with an area of Beijing City, approximately 19,048.87 sq.m. the PRC The g.f.a. of each building is summarized as below:
Building Gross Floor Area (sq.m.)
Block 6 11,480.07 Block 7 4,953.34
Total 16,433.41
As advised by the Group, the development was completed in 2008.
The property comprises part of the development with a total g.f.a. of approximately 12,000 sq.m..
The property is leased by Beijing Haichenruian Technology Co,. Ltd to the Group for a term of 32 months with an expiry date on 31 December 2012, at an annual rent of RMB 4,000,000.
Notes:
a) Pursuant to the following State-owned Land Use Rights Certificates, the land use rights of the site with a total site area of approximately 19,048.87 sq.m. were granted to the Group.
State-ownedLandUsedRights Certificate Number Date of Issuance Site Area Expiry Date (sq.m)
Kai You Xian Guo Yong (2003) No. 59 13 July 2005 8,768.10 25 November 2053 Kai You Xian Guo Yong (2003) No. 2 Sui Fu Guo Yong (2000) Zi No. Te 151 11 March 2003 10,280.60 10 March 2053
Total: 19,048.87
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b) Pursuant to the following Building Ownership Certificates issued by Construction Committee of Beijing Municipal, the building ownerships with a total g.f.a. of approximately 16,433.41 sq.m. have been granted to the Group.
Unit No. Building Ownership Certificate Number Gross Floor Area (sq.m.)
6 X Jing Fang Quan Zheng Kai Gu Zi No. 00319 11,480.07 7 X Jing Fang Quan Zheng Kai Gu Zi No. 006343 4,953.34
Total: 16,433.41
c) Pursuant to the tenancy agreement entered into between Beijing Haichenruian Technology Co,. Ltd (‘‘Party A’’) and Beijing Healthcare Technology Co., Ltd. (‘‘Party B’’), a subsidiary of the Group on 30 July 2010, Party A agreed to lease part of the property with a g.f.a. of approximately 12,000 sq.m. to Party B for a term of 32 months commencing from 1 May 2010 and expiring on 31 December 2012, at an annual rent of RMB 4,000,000.
d) Pursuant to the sub-tenancy agreement entered into Party B and Beijing Jianxiang Hemu Biological Technology Limited (‘‘Party C’’), a subsidiary of the Group, on 11 August 2010, Party B agreed to lease part of the property, Unit 208 of Block 6, with a total g.f.a. of approximately 200 sq.m. to Party C for a term of 32 months commencing from 1 May 2010 and expiring on 31 December 2012, at an annual rent of RMB70,000.
e) We were advised the owner is a connected party of the Group.
f) We have been provided with a legal opinion on the property prepared by the Group’slegaladviser,which contains, inter alia, the following information:
i) The tenancy agreement is legal, valid, binding on both parties and has been registered. The State- owned Land Use Rights Certificates Kai You Xian Guo Yong (2003) No. 2, Kai You Xian Guo Yong (2003) No. 59 and the Real Estate Title Certificates X Jing Fang Quan Zheng Kai Gu Zi No. 00319 and X Jing Fang Quan Zheng Kai Gu Zi No. 006343 are legal and valid.
ii) According to the tenancy agreement, Party A leased buildings with a g.f.a. of 12,000 sq.m. and land use rights with a site area of approximately 19,048.7 sq.m. to the Group with a lease term from 1 May 2010 to 31 December 2012. Party B is entitled to occupy and use the property in accordance with the tenancy agreement and the PRC law.
iii) The sub-tenancy agreement is legal, valid, binding on both parties and has been registered. Party B already obtained the written consent letter from Party A in relation to the portion of the property Party B sub-leased to Party C.
iv) Party A already obtained the relevant title documents in relation to the portion of the property Party B sub-leased to Party C.
v) According to the sub-tenancy agreement, Party B sub-leased Unit 208 of Block 6 to Party C with a lease term from 1 May 2010 to 31 December 2012. Party C is entitled to occupy and use this portion of the property in accordance with the sub-tenancy agreement and the PRC laws. No violation of the provisions of usage has been found.
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VALUATION CERTIFICATE
Capital value in existing state as at Property Description and tenure Details of occupancy 31 October 2010 (RMB)
4. An industrial complex, The development comprises five The property is currently No commercial value No. 148 Yanshan 1-storey warehouse and factory occupied by the Group Road, Shijiazhuang buildings and two ancillary buildings for for office, dormitory, Hi-Tech Industrial office and dormitory with a total g.f.a. of warehouse and Development Zone, approximately 18,579.58 sq.m. workshops. Shijiazhuang City, occupying a site with an area of Hebei Province, approximately 39,900 sq.m.(the ‘‘Site’’). the PRC The g.f.a. of each building is summarized as below:
Building Gross Floor Area (sq.m.)
005 1,006.79 010 1,006.79 003 9,321.28 008 1,322.30 009 1,989.30
Total 14,646.46
As advised by the Group, the development was completed in 2008.
The property comprises part of the development with a total g.f.a. of approximately 13,335.19 sq.m..
The property is leased by Shijiazhuang Maidisen Animal Healthcare Co,. Ltd to the Group for a term of 32 months with an expiry date on 31 December 2012, at an annual rent of RMB 4,100,000.
Notes:
a) Pursuant to the State-owned Land Use Rights Certificate Shi Kai (Dong) Guo Yong (2006) No. 103 dated 17 January 2006 issued by Shijiazhuang Municipal Land and Resources Bureau, the land use rights of the site with an area of approximately 39,900 sq.m. have been granted to Shijiazhuang Maidisen Animal Healthcare Co,. Ltd (石家莊麥迪森動物保健品有限公司) for industrial use with a land use term expiring on 11 September 2053.
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b) Pursuant to the following Building Ownership Certificates issued by Shijiazhuang Municipal Real Estate Management Bureau, the building ownerships with a total g.f.a. of approximately 14,646.46 sq.m. have been granted to the Group.
Unit No. Building Ownership Certificate Number Gross Floor Area (sq.m.)
003 Shi Fang Quan Zheng Kai Zi No. 780000140 9,321.28 005 Shi Fang Quan Zheng Kai Zi No. 780000139 1,006.79 010 1,006.79 008 Shi Fang Quan Zheng Kai Zi No. 780000167 1,322.30 009 1,989.30
Total: 14,646.46
c) As advised by the Group, the Building Ownership Certificates of two blocks of warehouse and factory buildings with a total g.f.a. of approximately 3,933.12 sq.m are in the progress of application.
d) Pursuant to the following tenancy agreements entered into between Shijiazhuang Maidisen Animal Healthcare Co,. Ltd (Party A) and the Group (Party B) on 30 July 2010, Party A agreed to lease the various portions of the property with a total g.f.a. of approximately 13,335.19 sq.m. to Party B for a term of 32 months commencing from 1 May 2010 and expiring on 31 December 2012.
No. GFA Annual Rent (sq.m.) (RMB)
1 451.36 140,000 2 2,213.10 680,000 3 451.36 140,000 4 451.36 140,000 5 451.36 140,000 6 451.36 140,000 7 2,213.10 680,000 8 2,216.15 680,000 9 2,222.94 680,000 10 2,213.10 680,000
Total: 13,335.19 4,100,000
e) We were advised the owner is a connected party of the Group.
f) We have been provided with a legal opinion on the property prepared by the Group’slegaladviser,which contains, inter alia, the following information:
i) The State-owned Land Use Rights Certificate Shi Kai (Dong) Guo Yong (2006) and the Real Estate Title Certificates Nos. 780000139 and No. 780000140 are legal and valid.
ii) Party A has obtained the title documents of the property under the tenancy agreement. The tenancy agreement is legal, valid, binding on both parties and has been registered. The Group is entitled to occupy and use the property in accordance with the tenancy agreement and the PRC law. No violation of the provisions of usage has been found.
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VALUATION CERTIFICATE
Capital value in existing state as at Property Description and tenure Details of occupancy 31 October 2010 (RMB)
5. An Industrial The property comprises four multi- The property is currently No commercial value Complex, Wei’er storey industrial buildings with a total occupied by the Group as Road, Gongye Cheng, g.f.a. of approximately 4,374.3 sq.m. offices and workshops. Shenzhou City, occupying on a site with an area of Hebei Province, approximately 11,067 sq.m.(the ‘‘Site’’). the PRC The g.f.a. of each building is summarized as below:
Building Gross Floor Area (sq.m.)
1 1,689.90 2764.00 3 1,743.10 4177.30
Total 4,374.30
As advised by the Group, the property was completed in around 2002.
The property is leased by Shenzhou Pagina Animal Technology Consulting ServiceLtd.totheGroupforatermof 32 months with an expiry date on 31 December 2012, at an annual rent of RMB700,000.
Notes:
a) Pursuant to the State-owned Land Use Rights Certificate Shen Guo Yong (2007) Dong Qu No. 002 dated November 2007 issued by People’s Government of Shenzhou Municipal, the land use rights of the site with an area of approximately 11,067 sq.m. have been granted to Shenzhou Pagina Animal Technology Consulting Service Ltd., (深州保吉安獸藥技術諮詢服務有限公司) for industrial use with a land use term expiring on 27 January 2052.
b) Pursuant to the Building Ownership Certificate Fang Quan Zheng Zi Nos. 8530-28-94 issued by Shenzhou Municipal Real Estate Bureau, the building ownerships of the property with a total g.f.a. of 4,374.3 sq.m. for industrialusehavebeengrantedtotheGroup.
c) Pursuant to a tenancy agreement entered into between Shenzhou Pagina Animal Technology Consulting Service Ltd. (Party A) and the Group (Party B) on 30 July 2010, Party A agreed to lease the property with a total g.f.a. of approximately 4,374.30 sq.m. to Party B for a term of 32 months commencing from 1 May 2010 and expiring on 31 December 2012, at an annual rent of RMB 700,000.
d) We were advised the owner is a connected party of the Group.
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e) We have been provided with a legal opinion on the property prepared by the Group’slegaladviser,which contains, inter alia, the following information:
i) The tenancy agreement is legal, valid, binding on both parties and has been registered. The State- owned Land Use Rights Certificates and the Real Estate Title Certificates are legal and valid.
ii) According to the tenancy agreement, Party A leased buildings with a g.f.a. of 4,374.3 sq.m. and land use rights with a site area of approximately 11,067 sq.m. to the Group from 1 May 2010 to 31 December 2012. The Group is entitled to occupy and use the property in accordance with the tenancy agreement and the PRC laws. No violation of the provisions of usage has been found.
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VALUATION CERTIFICATE
Capital value in existing state as at Property Description and tenure Details of occupancy 31 October 2010 (RMB)
6. 7 rented properties The properties comprise 7 premises The properties are No commercial value located in Shenyang operated as representative office currently occupied by the City, Hefei City and located in Shenyang City, Hefei City Group as representative Chengdu City, and Chengdu City. office. the PRC
Notes:
a) We have been advised that the lessors are Independent Third Parties of the Group.
b) Pursuant to the tenancy agreements provided by theGroup,somedetailsontherentedpropertiesare summarized as below:
Leased Annual No. Lessor Property Address area Lease Term Rent (sq.m.) (RMB)
1 Shenyang Jinze Logistics Door 1, Zhangshi Fruit 200 1/1/2010– 38,560 Company Limited Wholesale Market, Yuhong 12/31/2010 District, Shenyang City
2 Shenyang Haiyijiao Industry StallinsideMarketofthe Not 1/1/2010– 46,213 Company Limited Company, No. 65, Weishanhu defined 12/31/2010 Street, Yuhong District, Shenyang City
3HefeiCityGuangda Jiatang Village, Dayang 650 1/1/2010– 30,500 Construction Town, Hefei City 12/31/2010 Engineering Company Limited
4 Hefei Commerce and Leased Warehouse 500 1/1/2010– 48,000 Transportation Storage 12/31/2010 Company Limited Fuyangbeilu Branch
5 Feng Guigen No. 10, Unit 5, Section 5, Not 1/1/2010– 16,000 Mingyue Center Village, defined 12/31/2010 Tianhui Town, Jinniu District, Chengdu City
6 Ren Yonggui Section 9, Shiling Village, Not 1/1/2010– 16,200 Qinglong Town, Chenghua defined 12/31/2010 District, Chengdu City
7 Wu Zhiyong Shiling Village, Qinglong Not 1/1/2010– 18,000 Town, Chenghua District, defined 12/31/2010 Chengdu City
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c) We have been provided with a legal opinion on the property prepared by the Group’slegaladviser,which contains, inter alia, the following information:
i) The lessors have not provided the relevant Building Ownership Certificates and the lessors may have no rights to lease the properties.
ii) If the lessors do not have the relevant property title documents, then the tenancy agreements can be terminated at any time prior to the relevant Building Ownership Certificates being obtained.
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