TRANSLATION
Exhibit
4.18
Land Early Development Cost
Compensation Agreement
Party A:
Shanghai
Hong Qiao Lin Kong Economic Development Park Co., Ltd.
Party B:
Ctrip
Travel Information Technology (Shanghai) Co., Ltd.
THIS AGREEMENT is hereby entered into between
Party A and Party B in accordance with the “People’s
Republic of China, Contract Law” and other laws and
regulations in order to specify the rights and obligations of the
Parties following consensus reached through mutual consultation
according to which Party A has, for speeding up the construction of
Lin Kong Economic Zone, agreed to the use by Party B, under a land
use rights grant, a lot of land within Lin Kong Economic Zone where
Party B will register an enterprise for the construction of a
project (the “ Project Land ”) and Party B has,
in consideration of the early development completed on the Project
Land at the costs of Party A, agreed to pay to Party A an amount of
Land Early Development Cost Compensation.
Article 1: Project Land
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1.1
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The Project
Land is located in Land Lot No. 19 in Lin Kong Economic Zone (which
is the land south to Jinzhong Road and west to Fuquan Road under
the construction plan) with an area of 25 mu (see the area
map attached hereto as Appendix 1), the actual area of which shall
be based on the actual measurements as surveyed by the land
administration of the government.
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1.2
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The Project
Land is industrial land with a land use term of 50 years under the
law beginning from the date on which a “State-owned Land Use
Rights Grant Contract” is officially executed between Party B
and the land administration of the government and ending on the
date on which the land use term ends as specified in the Shanghai
Municipality Real Property Rights Certificate issued by Shanghai
Municipal Housing and Land Resources Administration.
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1.3
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Party A has
completed the pre-development requisition, removal, demolition and
relocation works in respect of the Project Land.
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1.4
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Municipal
utility facilities in, on or above the roads surrounding the
Project Land have been fully completed (the technical
specifications of the relevant utility facilities are attached
hereto as Appendix 2).
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Article 2: Conditions Precedent to Acquisition
of Project Land
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2.1
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Party B
undertakes to Party A that the Ctrip Information Technology Zone to
be constructed (which will be the China Headquarters of Ctrip
including Ctrip’s Management Center, Call Center, Technology
Development Center, Settlement Center and Marketing Center) will be
located in [South Block] of Shanghai Hong Qiao Lin Kong Economic
Zone (“ Lin Kong Zone ”) and that Party B will
take Lin Kong Zone as the primary place of tax settlement for its
China Headquarters.
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Article 3: Land Early Development Cost
Compensation (all amounts hereinafter are in RMB)
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3.1
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The Land Early
Development Cost Compensation payable by Party B to Party A means:
the costs of removal, demolition and relocation and the land use
rights base price incurred in requisition of collectively-owned
land or in exchange for state-owned land and the costs incurred in
connection with the construction of municipal utility facilities,
in each case, by Party A. Having regard to the fact that Party A
provides an enterprise with land in Lin Kong Zone only if the
enterprise satisfies the admission requirements of Linking Zone and
after Party A obtains approval from the land administration of the
government, and in order to support the admission to Lin Kong Zone
of Ctrip’s China Headquarters comprising of Ctrip’s
Management Center, Call Center, Technology Development Center,
Settlement Center and Marketing Center, Party A hereby agrees that
Party B may pay the Land Early Development Cost Compensation at a
preferential price of RMB 2.5 million per mu (excluding land
use rights grant fee), which is below the pre-construction cost
(RMB3.5 million/ mu , excluding land use rights grant fee),
in a total amount of approximately RMB 62.5 million, the specific
final amount to be based on the actual area as measured and
approved by the government.
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3.2
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Upon entering
into this Agreement with Party A, Party B shall on the basis of
this Agreement apply to the relevant government authority for the
approval of the construction project, enter into a
“State-owned Land Use Rights Grant Contract” with
Shanghai Municipal Housing and Land Resources Administration or the
land administration of a district level government (the contract is
attached hereto as Appendix 3) and pay the land use rights grant
fee specified by such contract.
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3.3
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Party B shall
pay such deed tax as required when applying for the initial
registration of the Real Property Rights Certificate.
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Article 4: Payment of Early Development Cost
Compensation; Local Tax Target and Preferential Policy
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(1)
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Payment of
Early Development Cost Compensation
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4.1
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The total
amount of the pre-construction cost compensation shall be RMB 2.5
million / mu x 25 mu = RMB 62.5 million, to be paid
in the following manner:
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4.1.1
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Party B shall
pay 20% (in the amount of RMB 12.5 million) of the total amount of
RMB 62.5 million to Party A by a valid instrument such as bank
draft within 10 days of the signing of this Agreement by the
Parties.
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4.1.2
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Party B shall
pay 40% (in the amount of RMB 25.0 million) of the total amount to
Party A by a valid instrument such as bank draft within 10 days of
the signing of a “State-owned Land Use Rights Grant
Contract” with Shanghai Municipal Housing and Land Resources
Administration or the land administration of a district level
government.
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4.1.3
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With respect to
the remaining 40% (in the amount of RMB 25.0 million, subject to
the final total amount after determination of the area of the
Project Land) of the total amount, Party B undertakes to pay to
Party A by a valid instrument such as bank draft by the end of
June, 2006.
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4.2
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After Party B
has paid the Land Early Development Cost Compensation in full (in
the amount of RMB 62.5 million) by the above-mentioned means of
payment, Party A shall support Party B in the form of Special
Support Funds using the district-level local taxes (namely the
portion of enterprise income tax, value-added tax, business tax,
urban development tax and individual income tax receivable by the
district-level government finance department) paid by Party B or
the enterprise registered by Party B in Lin Kong Zone during the
subsequent six years, with January, 2006 as the beginning of the
first year, in the proportion of 100% for the first year, 90% for
the second year, 80% for the third year, 70% for the fourth year,
60% for the fifth year and 50% for the sixth year.
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4.3
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Party A will
transfer the Enterprise Development Special Support Funds to Party
B in the above proportion as scheduled during the six years with
the specific time of fund transfer for each year to be at the end
of June of the immediately following year. The aggregate amount of
the Enterprise Development Special Support Funds to be transferred
from Party A to Party B within the six years shall not exceed 75%
of the total amount contributed by Party B to the tax revenues of
the district-level government finance department in the six
years.
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(2)
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Local Tax
Target and Preferential Policy
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4.4
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Party B
undertakes to maintain an average of local tax payment (namely the
portion of enterprise income tax, value-added tax, business tax,
urban development tax and individual income tax receivable by the
district-level government finance department, but excluding any tax
refund granted by national and municipal tax authorities, as shall
be case hereinafter) at or above RMB 500,000/ mu (unless in
the event of any force majeure such as war and natural disaster)
for each year of the first three years with January, 2006 as the
beginning of the first year. If Party B fails to maintain an
aggregate of such payment at or above RMB 1.5 million/ mu in
the first three years, Party B shall make up for the local tax
payment receivable by Party A for the current year (namely: RMB
500,000/ mu x 25 mu x the proportion receivable by
Party A for the current year) in monetary funds and, in addition,
Party A shall be entitled to demand Party B to make up to Party A
in monetary funds for the difference between the Land Early
Development Cost Compensation and the land cost calculated at RMB
3.5 million/ mu .
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4.5
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In the
subsequent three years, Party B shall maintain an average of local
tax payment at or above RMB 500,000/ mu (unless in the event
of any force majeure such as war and natural disaster), otherwise
it shall, in addition to making up for the local tax payment
receivable by Party A for each year (namely: RMB 500,000/ mu
x 25 mu x the proportion receivable by Party A for the
current year), make up to Party A in monetary funds for the
difference between the Land Early Development Cost Compensation and
the land cost calculated at RMB 3.5 million/ mu .
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4.6
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Party A shall
not repeat its demand to Party B for making up for the difference
between the land cost and the Land Early Development Cost
Compensation pursuant to Sub-Articles 4.4 and 4.5.
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4.7
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Beginning from
the seventh year after the date of delivery of the Project Land
from Party A to Party B, if Party B’s local tax payment
reaches or exceeds RMB 500,000 for the current year and subject to
the signing of another agreement between the Parties, Party A
undertakes to continue to support Party B with the Enterprise
Development Special Support Funds in a maximum amount of not
exceeding 50% of the total local tax payment (namely the portion of
enterprise income tax, value-added tax and business tax receivable
by the district-level government finance department) made by Party
B for the current year.
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Article 5: Conveyance of Project Land
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5.1
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Party A plans
to transfer the lot of land specified hereunder to Party B by
January 20, 2005 after having the land leveled and formed, and the
Parties shall complete the conveyance filing in writing upon such
transfer.
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5.2
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Party B shall
fence off the land after the area of the land has been measured and
the boundary of the land has been determined by the land
administration of the government.
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Article 6: Project Planning
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6.1
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At the time of
transferring the land to Party B, Party A shall notify Party B of
the planning requirements under the “Detailed Planning”
and “Landscaping Plan” of Lin Kong Zone approved by the
government (such plans are attached hereto as Appendix 4 and
Appendix 5, respectively), and Party B shall comply with such
requirements.
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6.2
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The project
design pr
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