8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 25, 2006

MULTI-FINELINE ELECTRONIX, INC.

(Exact name of registrant as specified in its charter)

Delaware	000-50812	95-3947402
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

3140 East Coronado Street

Anaheim, CA 92806

(Address of principal executive offices) (Zip Code)

(714) 238-1488

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement

On January 25, 2006, Multi-Fineline Electronix (Suzhou) Co., Ltd. (“MFC1”), a subsidiary of Multi-Fineline Electronix, Inc. (the “Company”), entered into an Agreement on Amount of Credit Line (the “MFC1 Credit Line”) with Bank of China Limited Suzhou Wuzhong Branch (“BC”), providing for a line of credit to MFC1 in an amount of 60,000 Chinese Renminbi (“RMB”), and Multi-Fineline Electronix (Suzhou No. 2) Co., Ltd. (“MFC2”), also a subsidiary of the Company, entered into an Agreement on Amount of Credit Line (the “MFC2 Credit Line”) with BC, providing for a line of credit to MFC2 in an amount of 40,000 RMB. Each of the MFC1 and MFC2 Credit Line will mature on January 24, 2007 and bear interest at LIBOR plus 0.85%. MFC1 also entered into a Contract of Suretyship of Maximum Amount (“Suretyship Contract”) with BC, wherein MFC1 guaranteed the obligations of MFC2 under the MFC2 Credit Line. A copy of each of the MFC1 Credit Line, MFC2 Credit Line and Suretyship Contract are attached hereto.

On January 26, 2006, the Company’s board of directors (“Board”) and the Special Compensation Committee of the Board, approved a bonus plan (the “Bonus Plan”) pursuant to which Philip A. Harding, the Company’s Chairman and Chief Executive Officer, Reza Meshgin, the Company’s President and Chief Operating Officer, Craig Riedel, the Company’s Chief Financial Officer, Thomas Lee, the Company’s Vice President of Operations and Charles Tapscott, the Company’s Vice President and Chief Technology Officer could obtain a cash bonus (“Bonus”), at a target level equal to seventy percent (70%) for Mr. Harding, fifty percent (50%) for Mr. Meshgin, and twenty-five percent (25%) to forty (40%) for the remaining executives, of such executive’s annual base salary at the end of fiscal year 2006, based upon the attainment of certain goals. In certain specified circumstances, the Bonuses may exceed these percentages.

The Bonus Plan includes the goals which the Company and each executives must attain in order to be awarded the Bonuses. Fifty percent (50%) of each executive’s target Bonus is tied to financial metrics related to revenue and profit after tax. The remaining fifty percent (50%) of each executive’s target Bonus is tied to individual goals related to industry and customer concentration, financial metrics regarding asset management, business planning initiatives and/or growth strategies. In addition, Messrs. Riedel, Lee and Tapscott have specified individual goals relating to their area of responsibility within the Company, to be set by the Company’s President and Chief Operating Officer (together with such individual).

Item 9.01. Financial Statements and Exhibits

(c) Exhibits

10.22	Agreement on Amount of Credit Line by and between Multi-Fineline Electronix (Suzhou) Co., Ltd. and Bank of China Limited Suzhou Wuzhong Branch dated January 25, 2006
10.23	Agreement on Amount of Credit Line by and between Multi-Fineline Electronix (Suzhou No. 2) Co., Ltd. and Bank of China Limited Suzhou Wuzhong Branch dated January 25, 2006
10.24	Contract of Suretyship of Maximum Amount by and between Multi-Fineline Electronix (Suzhou) Co., Ltd. and Bank of China Limited Suzhou Wuzhong Branch dated January 25, 2006

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: January 31, 2006	MULTI-FINELINE ELECTRONIX, INC.
	By:	/s/ Philip A. Harding
		Philip A. Harding
		Chief Executive Officer

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EXHIBIT INDEX

Exhibit No.	Description
10.22	Agreement on Amount of Credit Line by and between Multi-Fineline Electronix (Suzhou) Co., Ltd. and Bank of China Limited Suzhou Wuzhong Branch dated January 25, 2006
10.23	Agreement on Amount of Credit Line by and between Multi-Fineline Electronix (Suzhou No. 2) Co., Ltd. and Bank of China Limited Suzhou Wuzhong Branch dated January 25, 2006
10.24	Contract of Suretyship of Maximum Amount by and between Multi-Fineline Electronix (Suzhou) Co., Ltd. and Bank of China limited Suzhou Wuzhong Branch dated January 25, 2006

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EX-10.22

Exhibit 10.22

Agreement on Amount of Credit Line

No.: Wu Zhong Yin Shou Zi No. 0561112

Party A: MULTI-FINELINE ELECTRONIX (SUZHOU) CO., LTD.

Business license No. 005874

Legal Representative: Phil Harding

Tel: 0512-65638146

Party B: BANK OF CHINA LIMITED SUZHOU WUZHONG BRANCH

Director: Liu Li

Tel: 0512-65272848

In order to develop friendly and cooperative relationship, Party A and Party B have reached the following agreement through consultation based on the principle of voluntariness, equality, mutual benefit and sincerity.

Article 1 Business Scope

Party B shall provide line of credit for Party A in accordance with this agreement. Under the conditions in conformity to the provisions of this agreement and relevant agreement, Party A can apply for cycle use, adjustment or single use of short term loan of RMB and short term loan of foreign currency, issuance of banker’s acceptance bill as well as settlement and financing services (generally called “single credit service”) from Party B. Settlement and financing services herein refer to issuance of letter of credit, inward documentary bills, shipping guarantee, packing loan, outward documentary bills, discounting of acceptance bill under usance letter of credit, issuance of letter of guarantee / stand-by letter of credit and other settlement and financing services available of Party B with approval.

Article 2 Type and Amount of Credit Line

Party B agrees to provide the following credit line for Party A: the total amount is RMB 60,000,000 Yuan; the credit line of foreign currency services shall be converted into RMB according to the selling price of foreign exchange announced by Party B on the date of signature and validation of this agreement:

The credit line that Party B agrees to provide Party A includes:

1. Amount of short term loan in domestic and foreign currency: RMB 35,000,000 Yuan;

2. Amount of banker’s acceptance bill (open limit): RMB 10,000,000 Yuan;

3. Amount of letter of guarantee: RMB 15,000,000 Yuan;

The credit line of Party A already incurred from Party B before conclusion of this agreement shall be deemed as the credit under this agreement, which will account for a part of the credit line approved by Party B in this agreement.

Article 3 Use of the Credit Line

Within the term of the credit line agreed in Article 5 of this agreement, Party A can use the credit line in cycle within the amount limit of each single credit service specified in the above article;

If Party A needs to adjust the amount of the single credit service specified in Article 1, Party A shall submit the written application to Party B, and Party B will determine the specific method of adjustment.

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Article 4 Agreement for Single Credit Service

If Party A intends to apply for any single credit service under this agreement, Party A shall enter into the following agreements with Party B (generally called single service agreement):

1. For short-term loan of RMB, Party A shall enter into “RMB Loan Contract (Short Term)” with Party B;

2. For short-term loan of foreign currency, Party A shall enter into “Foreign Currency Loan Contract” with Party B;

3. For issuance of banker’s acceptance bill, Party A shall enter into “Commercial Acceptance Bill Agreement” with Party B;

4. For international settlement and financing service, Party A shall choose appropriate or enter into the following relevant attachments or written applications with Party B:

A. Both parties agree to enter into the single service agreement with the applicable attachment listed below through consultation, and it shall constitute an integral part of this agreement:

For the following attachments, the one marked with “þ” means “applicable,” and the one marked with “x” means “not applicable.” For applicable attachments, both parties do not need to sign or affix seal on relevant attachment. Either party shall not raise any object to the validity of such attachment that constitutes the legal document binding to both parties.

x Attachment (1): For issuance of letter of credit.

x Attachment (2): For inward documentary bills

x Attachment (3): For packing loan

x Attachment (4): For outward documentary bills

x Attachment (5): For discounting of acceptance bill under usance letter of credit

x Attachment (6): For issuance of letter of guarantee

B. The following application shall be submitted to Party B when Party A applies for specific settlement and financing service. Both parties shall fill in the document through consultation. Upon affixation of the official seal or business seal of Party B, it shall become a single service agreement and constitute an integral part of this agreement:

(1) Application for issuance of letter of guarantee

(2) Application for modification of letter of guarantee

5. Any other written agreement made between both parties for single credit service and the receipt of loan, application, letter and credence for money withdrawal, etc. submitted by Party A to Party B with the validity confirmed by Party B.

The single service agreement shall constitutes an integral part of this agreement, and both parties shall define the rights and obligation of both parties in accordance with the single service agreement and this agreement, particularly the balance of creditor’s right of Party B to Party A. In case of any conflict between the single service agreement and this agreement, the single service agreement shall take priority.

Article 5 Term of Use of Credit Line

The term of use of the credit line under this agreement shall start from the date on which this agreement comes into force as specified in Article 16 and end on January 24, 2007.

The term of use of the credit line will not be renewed automatically.

Before expiration of the term of use of the credit line, Party A may submit application for renewal to Party B. Upon approval and determination of the guarantee by Party B, the term of use can be renewed in writing. The new term of use of the credit line will be provided in the written agreement of renewal.

After expiration of the term of use of the credit line, both Party A and Party B shall go on executing the provisions of this agreement and relevant single service agreement concerning any actually incurred single credit service without affecting any incurred creditor’s rights and debts.

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Article 6 Preconditions for Single Credit Service

Party A must meet the following conditions when applies for the single credit service under this agreement:

1. Submit the application for relevant single credit service to Party B before the expiration of the term of credit line specified in Article 5 of this agreement;

2. Reserve the company document, bill, seal, list of relevant persons and signature sample in connection with this agreement and the single service agreement as well as properly fill in relevant voucher;

3. Open necessary account for the single credit service as required by Party B;

4. Properly go through the procedures for legal and administrative examination and approval of the single credit service, submit the copy or duplicate of the approval document according to the requirements of Party B; for the procedures to be handled by Party B according to the regulations of the national laws and rules, Party A agrees to provide any necessary cooperation;

5. Meet the preconditions for other services or money withdrawal according to the specifications of the single service agreement;

6. Pay the guarantee deposit or the guarantee agreement required by Party B has come into force;

7. Party A agrees to make the statements and promises specified in Article 9 of this agreement;

8. Other conditions that Party A should meet as required by Party B.

Article 7 Obligations of Party B

Party B has the following obligations:

1. Timely handle the application for single credit service as suggested by Party A according to the specifications of the single service agreement;

2. Provide civilized service while handling the application for single credit service as suggested by Party A;

3. Pay high attention to the supervision, query, and comment of Party A with proper treatment.

Article 8 Obligations of Party A

Party A has the following obligations:

1. Timely pay the expense payable to Party B within the specific time provided in this agreement and the single service agreement, and the charging method will take relevant regulations of Party B;

2. Pay excess reserves to Party B within the specific time provided in this agreement and the single service agreement;

3. Timely clear off the Party A’s debts to Party B as specified in this agreement and the single service agreement, including but not limited to the principal, interest, penalty interest, relevant expense, and any rate variance loss due to Party A’s breach of contract;

4. Use the obtained funds for the purpose specified in this agreement and the single service agreement.

Article 9 Statement and Promise

Party A makes the following statements:

1. Party A is a corporate that is established and existing pursuant to relevant laws. It has gone through the procedures of industrial & commercial registration and is granted with necessary rights, and it is able to perform the obligations under this agreement and the single service agreement under its name;

2. Conclusion and performance of this agreement and the single service agreement are based on the real intention of Party A. It has acquired legal and effective authorization of the company in accordance with the memorandum of association or other internal management documents, and it will not breach any agreement, contract and any other legal documents that are binding to Party A;

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3. All the documents, financial statements, vouchers and any other files provided to Party B by Party A under this agreement and the single service agreement are true, complete, accurate and valid;

4. The transaction background on which Party A applies for the service from Party B is true and legal without any illegal purpose such as money laundry. Party A’s provision of any document to Party B according to the requirements of Party B shall not be interpreted that Party B has the obligation and liability to check the trueness and legality of the transaction of Party A;

5. Party A does not conceal any fact that may have effect on the financial status and performance capacity of itself and the guarantor.

Party A makes the following guarantees:

1. Party A will regularly submit its financial statements to Party B (including but not limited to annual statement, quarterly statement and monthly statement) and other relevant data;

2. Party A will accept and cooperate with Party B in inspection and supervision of the use of credit line and relevant production, operation and financial activities of Party A;

3. If Party A has already entered into or will enter into a counter guarantee agreement or similar agreement with the guarantor under this agreement in regard to the obligations of the guarantor, such agreement should not do any harm to any rights of Party B under this agreement;

4. In case of anything that may have effect on the financial status or performance of Party A or the guarantor, including but not limited to reduction of registered capital, important transfer of assets or stock right, bearing important debt or setting new important debt on the object under mortgage, sealing up of object under mortgage, disbandment, revocation or application for bankruptcy voluntarily (or involuntarily), etc., Party A shall notify Party B as soon as possible without hesitation;

5. For separation, merger, joint operation, joint venture or cooperation with foreign investor, contracted operation, reorganization, conversion or other alteration in the operation mode in any way, Party A shall obtain the prior written permission of Party B;

6. For the matters not provided in this agreement, Party A agrees to comply with the international conventions and relevant regulations of Party B.

Article 10 Adjustment or Cancellation of Credit Line

During the term of use of the credit line, Party B has the right to adjust or cancel the credit line for Party A and declare expiration of the incurred debts ahead of schedule under any of the circumstances:

1. Party A breaches the agreement as specified in Article 11 of this agreement;

2. Party B believes the significant negative news occurs in the market or industry concerned;

3. Party B believes that any limitation policy issued by the state, any foreign government or international organization will or may cause great adverse effect on the industry or trade concerned in this agreement.

4. Serious deterioration in Party A’s financial status or serious problem in Party A’s production or operation.

Article 11 Breach of Agreement

Any of the following behaviors will be considered as breach of agreement by Party A:

1. Party A fails to perform the obligations of payment and liquidation to Party B as specified in this agreement and the single service agreement;

2. Party A fails to pay Party B the excess reserve as specified in this agreement and the single service agreement;

3. Party A fails to use the funds for the purpose as agreed in this agreement and the single service agreement;

4. The statement of Party A in this agreement is not true or Party A breaks any of its promises in this agreement;

5. Party A breaches any other provisions concerning the rights and obligations under this agreement and the single service agreement;

6. Party A breaches any other contract made with Party B;

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In case of any behavior listed above, Party B has the right to take the following measures respectively or at the same time:

1. Declare expiration of the loan / financing principal and interest and any other payables under the single service agreement without prior notice to Party A;

2. Directly deduct the principal, interest, penalty interest and rate variance loss of the debts to be paid back by Party A from the account that Party A opened in Party B or any other organizations of the Bank of China; the unexpired amount in Party A’s account will be deemed as the amount expired ahead of schedule. If the currency is different from the charging currency of Party B, the amount will be counted based on the exchange rate on the day of deduction;

3. Dispose the assets of guarantee to enjoy the propriety of compensation or claim for compensation from the guarantor;

4. Other necessary and possible measures as Party B believes necessary.

Article 12 Other Provisions

Without the written permission of Party B, Party A shall not assign any rights or obligations under this agreement to a third party.

If Party B has to entrust any other branches of the Bank of China (including branch bank and sub-branch bank) to perform its rights and obligations under this agreement due to the needs of business, Party A shall give consent. Any branch office of the Bank of China authorized by Party B has the right to execute all the rights under this agreement and the right to bring a lawsuit in the court or submit any dispute in connection with this agreement to the arbitration authority for settlement. Party A waives the right to raise any objection against the action or subject of arbitration raised by the branch office of the Bank of China.

Under the condition of no effect on any other provisions of this agreement, this agreement shall also be binding to both parties and their successors and assignees.

Article 13 Reservation of Rights

If Party B does not execute partial rights under this agreement or does not require Party A to perform partial obligations, it should not indicate that Party B gives up such rights or permits exemption of such obligations, also it should not indicate that Party B gives up other rights or permits exemption of other obligations of Party A under this agreement.

Any tolerance or permission of extension by Party B shall not affect Party B’s execution of any rights under this agreement or any other legal rights, and also it shall not be deemed as waiver of above rights of Party B.

Article 14 Modification, Cancellation and Interpretation of Contract

Unless otherwise specified in this agreement, this agreement is subject to modification, supplementation, or cancellation with the written permission of both parties. Any modification or supplementation of this agreement shall constitute an integral part of this agreement.

If any provision in this agreement becomes invalid, it shall not affect the validity of any other provisions of this agreement.

The titles and service names in this agreement and the single service agreement are only for convenience of indication, which should not be considered as the interpretation of the rights and obligations of the parties to this agreement.

Article 15 Settlement of Dispute

The Laws of the People’s Republic of China are applicable to this agreement.

Any dispute of conflict arising from execution of this agreement or in connection with this agreement shall be settled through consultation of both parties. If no agreement can be reached, either party can take legal action to the People’s Court where Party B or other branch office of the Bank of China that performs the rights and obligations under this agreement is located for settlement.

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Article 16 Validation of the Agreement

This agreement shall come into force from the date of signature of the legal representatives or the authorized representatives of both parties or from the date of affixation of the official seals. The date whichever is later shall be applicable.

This agreement has three originals, Party A retains one, Party B retains two, and all of them have the same legal force.

Article 17 Special Note

Party A and Party B have fully consulted with each other on all the provisions of this agreement and the single service agreement.

Party B has reminded Party A to pay special attention to the provisions concerning the rights and obligations of both parties to have a comprehensive and accurate understanding of them. Party B has provided explanation of above provisions at the request of Party A.

Party A:	/s/    PHILIP A. HARDING	Party B: Bank of China Limited Suzhou Wuzhong Branch
Legal representative or authorized representative:		Authorized representative:

January 25, 2006

/s/    LIU LI        

Site: The Bank of China Wuzhong Branch

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Attachment (6): Service of Issuing Letter of Guarantee

This attachment constitutes a part of Wu Zhong Yin Shou Zi No. 0561112 “Agreement on Amount of Credit Line” (hereinafter referred as the “agreement”) made between MULTI-FINELINE ELECTRONIX (SUZHOU) CO., LTD. (hereinafter referred to as “Party A”) and BANK OF CHINA LIMITED SUZHOU WUZHONG BRANCH (hereinafter referred to as “Party B”) on January 25, 2006.

1. In case of any conflict between this attachment and the agreement, this attachment shall take priority.

2. When Party A applies for issuance of letter of guarantee from Party B, the preconditions specified in Article 6 of the agreement shall be met.

3. Issuance and modification of the letter of guarantee:

(1) If Party B accepts the Application for Issuance of Letter of Guarantee submitted by Party A, Party B shall issue the letter of guarantee as agreed by both parties.

(2) The specific contents of the letter of guarantee to be issued by Party B for Party A may refer to the “Application for Issuance of Letter of Guarantee” submitted by Party A to Party B, but the final contents will be in letter of guarantee issued by Party B.

(3) If Party A needs to conduct modification of the letter of guarantee, it shall submit an “Application for Modification of Letter of Guarantee” to Party B. If such modification involves the amount, currency, interest rate and time limit, etc. and Party B believes that will bring heavier obligation of guarantee, Party B has the right to require Party A to increase the guarantee deposit or require Party A to have the counter guarantor to sign on the “Application for Modification of Letter of Guarantee”, otherwise Party B has the right to refuse the application of Party A for modification.

(4) Any modification of the letter of guarantee shall not change any other rights and obligations of Party A under the agreement and this attachment.

4. Party A shall pay the excess reserve as specified in Article 2 of the “Application for Issuance of Letter of Guarantee.”

5. Party A agrees that during the valid term of the letter of guarantee, in case of any claim for compensation under the letter of guarantee, and such claim of the beneficiary meets the conditions provided in the letter of guarantee through examination by Party B, Party B has the right to directly deduct such amount from the excess reserve paid by Party A to perform the obligation of payment. If the excess reserve is not enough to cover the payment of compensation and Party B needs to make payment for Party A, such payment will become the debt of Party A to Party B under the agreement and this attachment. The interest rate will be counted based on the rate of overdue payment provided by Party B.

6. Except for the provision of Article 9 of the agreement, Party A shall make the following supplementary promises to Party B for the purpose of the services under this attachment:

(1) If the letter of guarantee is issued by any other bank under trust, Party A agrees to bear any risks and liabilities of Party B for the issuing bank under the letter of guarantee;

(2) In case the execution, modification, alteration or termination of the basic transaction under the basic contract based on which the letter of guarantee is issued has any effect on Party B’s liability for guarantee, Party A shall notify Party B immediately;

(3) Party A shall cooperate with Party B in handling relevant procedures of examination and approval for the purpose of execution of the agreement for external guarantee;

(4) Party A will bear any risk of loss, delay, error or damage, etc. of the correspondences and bills during transmission via post, telecommunication or any other way as well as the risk arising from using the service of a third party by Party B;

(5) If the letter of guarantee does not provide the specific date of invalidation, information about compliance with the foreign laws or conventions, and the specific amount of guarantee, Party A agrees to be responsible for compensation for any risks, liabilities and losses brought to Party B;

7. Besides the circumstances specified in Article 11 of the agreement, if Party A fails to comply with the promises in Article 6 of this attachment, Party A has then breached the agreement under this attachment. Party B has the right to execute the rights specified in Article 11 of the agreement.

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EX-10.23

Exhibit 10.23

Agreement on Amount of Credit Line

No.: Wu Zhong Yin Shou Zi No. 0561113

Party A: MULTI-FINELINE ELECTRONIX (SUZHOU No. 2) CO., LTD.

Business license No. 011598

Legal Representative: Phil Harding

Residence: Dongwu Industrial Park, Wuzhong Economic Development Zone, Suzhou

Contact: 65130088

Party B: BANK OF CHINA LIMITED SUZHOU WUZHONG BRANCH

Director: Liu Li

Tel: 0512-65272848

In order to develop friendly and cooperative relationship, Party A and Party B have reached the following agreement through consultation based on the principle of voluntariness, equality, mutual benefit and sincerity.

Article 1 Business Scope

Party B shall provide line of credit for Party A in accordance with this agreement. Under the conditions in conformity to the provisions of this agreement and relevant agreement, Party A can apply for cycle use, adjustment or single use of short term loan of RMB and short term loan of foreign currency, issuance of banker’s acceptance bill as well as settlement and financing services (generally called “single credit service”) from Party B. Settlement and financing services herein refer to issuance of letter of credit, inward documentary bills, shipping guarantee, packing loan, outward documentary bills, discounting of acceptance bill under usance letter of credit, issuance of letter of guarantee / stand-by letter of credit and other settlement and financing services available of Party B with approval.

Article 2 Type and Amount of Credit Line

Party B agrees to provide the following credit line for Party A: the total amount is RMB 40,000,000 Yuan; the credit line of foreign currency services shall be converted into RMB according to the selling price of foreign exchange announced by Party B on the date of signature and validation of this agreement:

The credit line that Party B agrees to provide Party A includes:

1. Amount of short term loan in domestic and foreign currency: RMB 20,000,000 Yuan;

2. Amount of letter of guarantee: RMB 20,000,000 Yuan;

The credit line of Party A already incurred from Party B before conclusion of this agreement shall be deemed as the credit under this agreement, which will account for a part of the credit line approved by Party B in this agreement.

Article 3 Use of the Credit Line

Within the term of the credit line agreed in Article 5 of this agreement, Party A can use the credit line in cycle within the amount limit of each single credit service specified in the above articles;

If Party A needs to adjust the amount of the single credit service specified in Article 1, Party A shall submit the written application to Party B, and Party B will determine the specific method of adjustment.

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Article 4 Agreement for Single Credit Service

If Party A intends to apply for any single credit service under this agreement, Party A shall enter into the following agreements with Party B (generally called single service agreement):

1. For short-term loan of RMB, Party A shall enter into “RMB Loan Contract (Short Term)” with Party B;

2. For short-term loan of foreign currency, Party A shall enter into “Foreign Currency Loan Contract” with Party B;

3. For issuance of banker’s acceptance bill, Party A shall enter into “Commercial Acceptance Bill Agreement” with Party B;

4. For international settlement and financing service, Party A shall choose appropriate or enter into the following relevant attachments or written applications with Party B:

A. Both parties agree to enter into the single service agreement with the applicable attachment listed below through consultation, and it shall constitute an integral part of this agreement:

For the following attachments, the one marked with “þ” means “applicable,” and the one marked with “x” means “not applicable.” For applicable attachments, both parties do not need to sign or affix seal on relevant attachment. Either party shall not raise any object to the validity of such attachment that constitutes the legal document binding to both parties.

x Attachment (1): For issuance of letter of credit.

x Attachment (2): For inward documentary bills.

x Attachment (3): For packing loan.

x Attachment (4): For outward documentary bills.

x Attachment (5): For discounting of acceptance bill under usance letter of credit.

þ Attachment (6): For issuance of letter of guarantee.

B. The following application shall be submitted to Party B when Party A applies for specific settlement and financing service. Both parties shall fill in the document through consultation. Upon affixation of the official seal or business seal of Party B, it shall become a single service agreement and constitute an integral part of this agreement:

(1) Application for issuance of letter of guarantee

(2) Application for modification of letter of guarantee

5. Any other written agreement made between both parties for single credit service and the receipt of loan, application, letter and credence for money withdrawal, etc. submitted by Party A to Party B with the validity confirmed by Party B.

The single service agreement shall constitutes an integral part of this agreement, and both parties shall define the rights and obligation of both parties in accordance with the single service agreement and this agreement, particularly the balance of creditor’s right of Party B to Party A. In case of any conflict between the single service agreement and this agreement, the single service agreement shall take priority.

Article 5 Term of Use of Credit Line

The term of use of the credit line under this agreement shall start from the date on which this agreement comes into force as specified in Article 17 and end on January 24, 2007.

The term of use of the credit line will not be renewed automatically.

Before expiration of the term of use of the credit line, Party A may submit application for renewal to Party B. Upon approval and determination of the guarantee by Party B, the term of use can be renewed in writing. The new term of use of the credit line will be provided in the written agreement of renewal.

After expiration of the term of use of the credit line, both Party A and Party B shall go on executing the provisions of this agreement and relevant single service agreement concerning any actually incurred single credit service without affecting any incurred creditor’s rights and debts.

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Article 6 Preconditions for Single Credit Service

Party A must meet the following conditions when applies for the single credit service under this agreement:

1. Submit the application for relevant single credit service to Party B before the expiration of the term of credit line specified in Article 5 of this agreement;

2. Reserve the company document, bill, seal, list of relevant persons and signature sample in connection with this agreement and the single service agreement as well as properly fill in relevant voucher;

3. Open necessary account for the single credit service as required by Party B;

4. Properly go through the procedures for legal and administrative examination and approval of the single credit service, submit the copy or duplicate of the approval document according to the requirements of Party B; for the procedures to be handled by Party B according to the regulations of the national laws and rules, Party A agrees to provide any necessary cooperation;

5. Meet the preconditions for other services or money withdrawal according to the specifications of the single service agreement;

6. Pay the guarantee deposit or the guarantee agreement required by Party B has come into force;

7. Party A agrees to make the statements and promises specified in Article 10 of this agreement;

8. Other conditions that Party A should meet as required by Party B.

Article 7 Obligations of Party B

Party B has the following obligations:

1. Timely handle the application for single credit service as suggested by Party A according to the specifications of the single service agreement;

2. Provide civilized service while handling the application for single credit service as suggested by Party A;

3. Pay high attention to the supervision, query, and comment of Party A with proper treatment.

Article 8 Obligations of Party A

Party A has the following obligations:

1. Timely pay the expense payable to Party B within the specific time provided in this agreement and the single service agreement, and the charging method will take relevant regulations of Party B;

2. Pay excess reserves to Party B within the specific time provided in this agreement and the single service agreement;

3. Timely clear off the Party A’s debts to Party B as specified in this agreement and the single service agreement, including but not limited to the principal, interest, penalty interest, relevant expense, and any rate variance loss due to Party A’s breach of contract;

4. Use the obtained funds for the purpose specified in this agreement and the single service agreement.

Article 9 Suretyship

Regarding any debt of Party A to Party B incurred according to this agreement and any single service agreement (including after adjustment of variety within the total amount of credit line), both parties agree to take the maximum amount of suretyship provided by MULTI-FINELINE ELECTRONIX (SUZHOU) CO., LTD. and enter into the “Contract of Suretyship of Maximum Amount” Wu Zhong Yin Bao Zi No. 0561113.

In case of any event of Party A or the surety that may affect the performance of contract or cause the document of suretyship void at Party B’s discretion, or the debt paying ability of the surety is decreased due to deterioration of financial condition or any other reasons, or the surety breaches any contract made with Party B including other suretyship contracts, or the capacity of suretyship is lessened or lost due to devaluation, damage, loss or expropriation of the object of pledge,

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Party B has the right to require Party A to change the surety or provide new object of pledge for guaranty of the debt of Party A to Party B.

Article 10 Statement and Promise

Party A makes the following statements:

1. Party A is a corporate that is established and existing pursuant to relevant laws. It has gone through the procedures of industrial & commercial registration and is granted with necessary rights, and it is able to perform the obligations under this agreement and the single service agreement under its name;

2. Conclusion and performance of this agreement and the single service agreement are based on the real intention of Party A. It has acquired legal and effective authorization of the company in accordance with the memorandum of association or other internal management documents, and it will not breach any agreement, contract and any other legal documents that are binding to Party A;

3. All the documents, financial statements, vouchers and any other files provided to Party B by Party A under this agreement and the single service agreement are true, complete, accurate and valid;

4. The transaction background on which Party A applies for the service from Party B is true and legal without any illegal purpose such as money laundry. Party A’s provision of any document to Party B according to the requirements of Party B shall not be interpreted that Party B has the obligation and liability to check the trueness and legality of the transaction of Party A;

5. Party A does not conceal any fact that may have effect on the financial status and performance capacity of itself and the guarantor.

Party A makes the following guarantees:

1. Party A will regularly submit its financial statements to Party B (including but not limited to annual statement, quarterly statement and monthly statement) and other relevant data;

2. Party A will accept and cooperate with Party B in inspection and supervision of the use of credit line and relevant production, operation and financial activities of Party A;

3. If Party A has already entered into or will enter into a counter guarantee agreement or similar agreement with the guarantor under this agreement in regard to the obligations of the guarantor, such agreement should not do any harm to any rights of Party B under this agreement;

4. In case of anything that may have effect on the financial status or performance of Party A or the guarantor, including but not limited to reduction of registered capital, important transfer of assets or stock right, bearing important debt or setting new important debt on the object under mortgage, sealing up of object under mortgage, disbandment, revocation or application for bankruptcy voluntarily (or involuntarily), etc., Party A shall notify Party B as soon as possible without hesitation;

5. For separation, merger, joint operation, joint venture or cooperation with foreign investor, contracted operation, reorganization, conversion or other alteration in the operation mode in any way, Party A shall obtain the prior written permission of Party B;

6. For the matters not provided in this agreement, Party A agrees to comply with the international conventions and relevant regulations of Party B.

Article 11 Adjustment or Cancellation of Credit Line

During the term of use of the credit line, Party B has the right to adjust or cancel the credit line for Party A and declare expiration of the incurred debts ahead of schedule under any of the circumstances:

1. Party A breaches the agreement as specified in Article 12 of this agreement;

2. Party B believes the significant negative news occurs in the market or industry concerned;

3. Party B believes that any limitation policy issued by the state, any foreign government or international organization will or may cause great adverse effect on the industry or trade concerned in this agreement.

4. Serious deterioration in Party A’s financial status or serious problem in Party A’s production or operation.

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Article 12 Breach of Agreement

Any of the following behaviors will be considered as breach of agreement by Party A:

1. Party A fails to perform the obligations of payment and liquidation to Party B as specified in this agreement and the single service agreement;

2. Party A fails to pay Party B the excess reserve as specified in this agreement and the single service agreement;

3. Party A fails to use the funds for the purpose as agreed in this agreement and the single service agreement;

4. The statement of Party A in this agreement is not true or Party A breaks any of its promises in this agreement;

5. Party A breaches any other provisions concerning the rights and obligations under this agreement and the single service agreement;

6. Party A breaches any other contract made with Party B;

In case of any behavior listed above, Party B has the right to take the following measures respectively or at the same time:

1. Declare expiration of the loan / financing principal and interest and any other payables under the single service agreement without prior notice to Party A;

2. Directly deduct the principal, interest, penalty interest and rate variance loss of the debts to be paid back by Party A from the account that Party A opened in Party B or any other organizations of the Bank of China; the unexpired amount in Party A’s account will be deemed as the amount expired ahead of schedule. If the currency is different from the charging currency of Party B, the amount will be counted based on the exchange rate on the day of deduction;

3. Dispose the assets of guarantee to enjoy the propriety of compensation or claim for compensation from the guarantor;

4. Other necessary and possible measures as Party B believes necessary.

Article 13 Other Provisions

Without the written permission of Party B, Party A shall not assign any rights or obligations under this agreement to a third party.

If Party B has to entrust any other branches of the Bank of China (including branch bank and sub-branch bank) to perform its rights and obligations under this agreement due to the needs of business, Party A shall give consent. Any branch office of the Bank of China authorized by Party B has the right to execute all the rights under this agreement and the right to bring a lawsuit in the court or submit any dispute in connection with this agreement to the arbitration authority for settlement. Party A waives the right to raise any objection against the action or subject of arbitration raised by the branch office of the Bank of China.

Under the condition of no effect on any other provisions of this agreement, this agreement shall also be binding to both parties and their successors and assignees.

Article 14 Reservation of Rights

If Party B does not execute partial rights under this agreement or does not require Party A to perform partial obligations, it should not indicate that Party B gives up such rights or permits exemption of such obligations, also it should not indicate that Party B gives up other rights or permits exemption of other obligations of Party A under this agreement.

Any tolerance or permission of extension by Party B shall not affect Party B’s execution of any rights under this agreement or any other legal rights, and also it shall not be deemed as waiver of above rights of Party B.

Article 15 Modification, Cancellation and Interpretation of Contract

Unless otherwise specified in this agreement, this agreement is subject to modification, supplementation, or cancellation with the written permission of both parties. Any modification or supplementation of this agreement shall constitute an integral part of this agreement.

If any provision in this agreement becomes invalid, it shall not affect the validity of any other provisions of this agreement.

The titles and service names in this agreement and the single service agreement are only for convenience of indication, which should not be considered as the interpretation of the rights and obligations of the parties to this agreement.

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Article 16 Settlement of Dispute

The Laws of the People’s Republic of China are applicable to this agreement.

Any dispute of conflict arising from execution of this agreement or in connection with this agreement shall be settled through consultation of both parties. If no agreement can be reached, either party can take legal action to the People’s Court where Party B or other branch office of the Bank of China that performs the rights and obligations under this agreement is located for settlement.

Article 17 Validation of the Agreement

This agreement shall come into force from the date of signature of the legal representatives or the authorized representatives of both parties or from the date of affixation of the official seals. The date whichever is later shall be applicable.

This agreement has three originals, Party A retains one, Party B retains two, and all of them have the same legal force.

Article 18 Special Note

Party A and Party B have fully consulted with each other on all the provisions of this agreement and the single service agreement.

Party B has reminded Party A to pay special attention to the provisions concerning the rights and obligations of both parties to have a comprehensive and accurate understanding of them. Party B has provided explanation of above provisions at the request of Party A.

Party A:	/s/    PHILIP A. HARDING	Party B: Bank of China Limited Suzhou Wuzhong Branch
Legal representative or authorized representative:		Authorized representative:

January 25, 2006

/s/    LIU LI        

Site: The Bank of China Wuzhong Branch

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Attachment (6): Service of Issuing Letter of Guarantee

This attachment constitutes a part of Wu Zhong Yin Shou Zi No. 0561113 “Agreement on Amount of Credit Line” (hereinafter referred as the “agreement”) made between MULTI-FINELINE ELECTRONIX (SUZHOU) CO., LTD. (hereinafter referred to as “Party A”) and BANK OF CHINA LIMITED SUZHOU WUZHONG BRANCH (hereinafter referred to as “Party B”) on January 25, 2006.

1. In case of any conflict between this attachment and the agreement, this attachment shall take priority.

2. When Party A applies for issuance of letter of guarantee from Party B, the preconditions specified in Article 6 of the agreement shall be met.

3. Issuance and modification of the letter of guarantee:

(1) If Party B accepts the Application for Issuance of Letter of Guarantee submitted by Party A, Party B shall issue the letter of guarantee as agreed by both parties.

(2) The specific contents of the letter of guarantee to be issued by Party B for Party A may refer to the “Application for Issuance of Letter of Guarantee” submitted by Party A to Party B, but the final contents will be in letter of guarantee issued by Party B.

(3) If Party A needs to conduct modification of the letter of guarantee, it shall submit an “Application for Modification of Letter of Guarantee” to Party B. If such modification involves the amount, currency, interest rate and time limit, etc. and Party B believes that will bring heavier obligation of guarantee, Party B has the right to require Party A to increase the guarantee deposit or require Party A to have the counter guarantor to sign on the “Application for Modification of Letter of Guarantee,” otherwise Party B has the right to refuse the application of Party A for modification.

(4) Any modification of the letter of guarantee shall not change any other rights and obligations of Party A under the agreement and this attachment.

4. Party A shall pay the excess reserve as specified in Article 2 of the “Application for Issuance of Letter of Guarantee.”

5. Party A agrees that during the valid term of the letter of guarantee, in case of any claim for compensation under the letter of guarantee, and such claim of the beneficiary meets the conditions provided in the letter of guarantee through examination by Party B, Party B has the right to directly deduct such amount from the excess reserve paid by Party A to perform the obligation of payment. If the excess reserve is not enough to cover the payment of compensation and Party B needs to make payment for Party A, such payment will become the debt of Party A to Party B under the agreement and this attachment. The interest rate will be counted based on the rate of overdue payment provided by Party B.

6. Except for the provision of Article 9 of the agreement, Party A shall make the following supplementary promises to Party B for the purpose of the services under this attachment:

(1) If the letter of guarantee is issued by any other bank under trust, Party A agrees to bear any risks and liabilities of Party B for the issuing bank under the letter of guarantee;

(2) In case the execution, modification, alteration or termination of the basic transaction under the basic contract based on which the letter of guarantee is issued has any effect on Party B’s liability for guarantee, Party A shall notify Party B immediately;

(3) Party A shall cooperate with Party B in handling relevant procedures of examination and approval for the purpose of execution of the agreement for external guarantee;

(4) Party A will bear any risk of loss, delay, error or damage, etc. of the correspondences and bills during transmission via post, telecommunication or any other way as well as the risk arising from using the service of a third party by Party B;

(5) If the letter of guarantee does not provide the specific date of invalidation, information about compliance with the foreign laws or conventions, and the specific amount of guarantee, Party A agrees to be responsible for compensation for any risks, liabilities and losses brought to Party B;

7. Besides the circumstances specified in Article 12 of the agreement, if Party A fails to comply with the promises in Article 6 of this attachment, Party A has then breached the agreement under this attachment. Party B has the right to execute the rights specified in Article 12 of the agreement.

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EX-10.24

Exhibit 10.24

Contract of Suretyship of Maximum Amount

No.: Wu Zhong Yin Bao Zi No. 0561113

Party A:	MULTI-FINELINE ELECTRONIX (SUZHOU) CO., LTD.
Business License No.	005874
Legal Representative:	Phil Harding
Tel:	0512-65638146
Party B:	BANK OF CHINA LIMITED SUZHOU WUZHONG BRANCH
Director:	Liu Li
Tel:	0512-65272848

In order to ensure proper performance of the obligations of the debtor under the principal contracts made or to be made between the debtor MULTI-FINELINE ELECTRONIX (SUZHOU No. 2) CO., LTD. and the creditor to this contract, the surety is willing to assume jointly and severally liability of suretyship to the creditor. Both parties agree to enter into this contract through consultation based on equality. Unless otherwise specified in this contract, the terms in this contract shall be defined according to the principal contract.

Article 1 Primary Contract

The principal contract for this contract refers to the “Agreement on Amount of Credit Line” Wu Zhong Yin Shou Zi No. 0561113 concluded by the debtor and the creditor on January 25, 2006 as well as any single service agreement made between both parties based on such agreement. Single service agreement refers to “RMB Loan Contract (short term),” “Foreign Currency Loan Contract” and “Commercial Acceptance Bill Agreement” concluded by the debtor and the creditor for a purpose of using the credit line approved by the creditor, as well as the attachment applicable to relevant settlement and financing services under the above “Agreement on Amount of Credit Line,” “Settlement and Financing Service Application” signed by the debtor and the creditor, any other written agreement reached by both parties concerning any single credit service and the receipt of loan, application, other letters or vouchers for month withdrawal, etc. that the debtor submitted to the creditor with the validity confirmed by the creditor.

The surety agrees that the creditor provides the credit line for the debtor in accordance with the principal contract and allows the debtor to use such credit line under the conditions as specified in the principal contract to receive RMB short term loans, foreign currency short loans, issuance of banker’s acceptance bill and settlement and financing services. The settlement and financing services refer to issuance of letter of credit, import foreign exchange collateral, shipment pickup guarantee, packing loan, export foreign exchange collateral, discounting of acceptance bill under issued letter of credit, issuance of letter of guarantee/stand-by letter of credit.

Article 2 Suretyship Range

The surety hereby irrevocably makes guarantee to the creditor that the debtor will perform its obligations under the principal contract including repayment of credit/financing principal, interest and relevant accounts.

The principal creditor’s right under the suretyship of the surety under this contract is the whole credit/financing as specified in “Agreement on Amount of Credit Line” Wu Zhong Yin Shou Zi No. 0561113 by the debtor and the creditor, including any balance of credit/financing incurred from the date on which the “Agreement on Amount of Credit Line” comes into effect to January 24, 2007 based on the agreement and any single service agreement. The maximum amount of the creditor’s right under suretyship is equivalent to RMB 40 million Yuan.

The suretyship range of this contract covers any principal of the creditor’s right incurred based on the principal contract, the interest (including legally allowed interest, contract interest, compound interest, penalty interest), penalty for breach of contract, compensation, expense on realization of the creditor’s right (including but not limited to legal cost, attorney fee, notary fee and execution fee, etc.), any

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loss of the creditor due to the breach of contract by the debtor and any other expenses payable.

Article 3 Mode of Suretyship

Suretyship of joint and several liabilities is provided in this suretyship contract.

If the debtor fails to make payment to the creditor on the normal payment day or any payment day ahead of schedule under the principal contract, the creditor has the right to require the surety to bear the liability for guarantee. The creditor specially points out that the normal payment day mentioned in this article refers to the payment day of interest specified in the principal contract, the payment day of principal or interest specified in the repayment plan, receipt of loan and application, etc., or the date on which the debtor shall make any payment to the creditor as agreed in this contract. The payment day ahead of schedule mentioned in this article refers to the date of payment ahead of schedule proposed by the debtor and approved by the creditor and the date of withdrawal of financing principal and interest before the scheduled expiration and/or any other payment day as required by the creditor based on the provisions of the contract.

In case the debtor fails to make payment in accordance with the principal contract, the surety shall, after the creditor sends the notice of debt collection, notice of performance of suretyship liability or any other similar notice of document to it, perform the suretyship liability within the specific term and with specific amount agreed in the notice. The notice shall be in written form and be sent via registered mail, express delivery or special delivery by the creditor. Upon sending the notice by the creditor, such notice will be deemed to have been delivered to the surety. The surety shall sign in and send the notice of receipt to the creditor within 3 days. If the surety fails to sign in or make any reply, the surety will be deemed to have received the document.

When the creditor requires the surety to perform the liability of suretyship within the term of suretyship, the surety shall not refuse the requirement with any reasons. Such reasons include but not limited to the following: the creditor does not notify the surety of the breach of contract by the debtor; dispute arises from relevant principal contract between the creditor and the debtor; the creditor gives tolerance, extends a time limit, allows exemption for the debtor under the principal contract, or the creditor gives up any rights under this principal contract; the creditor does not demand for repayment from the debtor; the creditor does not demand for repayment from any other sureties to the principal contract; the creditor does not execute any mortgage rights, right of pledge or other real rights for security in connection with the principal contract; the creditor fails to execute any other rights or take any remedial measures under the principal contract; the creditor and the debtor have conducted modification of the principal contract unless otherwise specified in this contract.

Article 4 Terms of Suretyship

The settlement term of creditor’s right under suretyship of this contract is January 24, 2007 agreed in the second paragraph of Article 2 of this contract or the other date on which the amount of creditor’s right can be determined pursuant to the law (the one which is earlier will prevail).

The surety shall assume the suretyship of joint and several liabilities in accordance with this contract from the date specified in the first paragraph of this article.

The term of suretyship is two years from the date specified in the first paragraph of this article.

Article 5 Relationship between the Suretyship Contract and the Principal Contract

This suretyship contract provides independent suretyship. Any invalidation or revocability of the principal contract for any reasons will not have any effects on the validity of this suretyship contract, and this suretyship contract shall still remain in force. The surety shall bear the suretyship liability for the creditor. In case both parties to the principal contract cancel the principal contract or make the principal contract expire ahead of schedule, the suretyship contract will still remain in force, and the surety shall be liable for any incurred debt and any loss to the creditor due to the debtor.

Both parties to the principal contract who agree to modify the contents of the principal contract or update the letter of credit or letter of guarantee/stand-by letter of credit issued in accordance with the principal contract may not necessarily obtain the written permission of the surety. The surety will still assume the suretyship liability for any incurred debt after modification of the principal contract and update of the letter of credit or letter of guarantee/stand-by letter of credit, except for any of the following circumstances:

1. The term for use of the credit line specified in “Agreement on Amount of Credit Line” Wu Zhong Yin Shou Zi No. 0561113 has been extended;

2. Direct increase in the amount of any single credit service specified in “Agreement on Amount of Credit Line” Wu Zhong Yin Shou Zi No. 0561113, not including adjustment in use of the single credit service.

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The creditor has the right to agree the debtor to use the single credit service in accordance with the principal contract or assign the rights and obligations under the principal contract in part or in entirety to other branches of the Bank of China or assign the creditor’s rights under the principal contract to a third party without the written permission of the surety. The surety’s liabilities will not be reduced or exempted for such actions.

Article 6 Statement and Promise

The surety makes the following statements and promises:

1. The surety has the qualification of surety pursuant to the laws of the People’s Republic of China, and the surety has the ability to bear the liabilities of suretyship;

2. The surety completely understands the contents of the principal contract and will provide suretyship at its own will; the legal representative or authorized representative that signs this contract on behalf of the surety must be legally authorized; signing and execution of this contract will not breach any contract, agreement or other legal documents that have binding force to the surety;

3. All the documents and data provided by the surety to the creditor are true, correct, complete and valid;

4. The surety will accept the supervision and inspection from the creditor of its own production, operation and financial status, and meanwhile provide assistance and cooperation;

5. The surety does not conceal from the creditor any important debt that it has undertaken before conclusion of the contract;

6. In case the surety reduces the registered capital, assigns a substantial portion of its assets or stock rights, undertakes any important debt, experiences dissolution, revocation, applies for bankruptcy (or by a 3^rd party) or any other event that may have impact on the financial status and performance of the surety, the surety shall notify the creditor as soon as possible without hesitation.

Article 7 Breach of Contract

Any of the following circumstances will constitute breach of this contract by the surety:

1. The surety fails to perform its liability of suretyship as specified in Article 3 of this contract;

2. The statements made under this contract are false or the surety breaks any promises made under this contract;

3. The surety breaches any other provisions of this contract concerning the rights and obligations of relevant party;

If the surety breaches this contract, the creditor has the right to take one or more of the following measures:

1. Reduce or cancel the credit line that the creditor provides for the surety

2. Declare expiration of the loan contract, credit contract and any other contracts between the surety and the creditor ahead of schedule;

3. Require the surety to pay compensations for any direct or indirect losses to the creditor due to breach of the contract (including but not limited to the loss in credit/financing principal, interest and expense under the principal contract);

4. Offset the creditor’s rights with the funds of the surety in the accounts at the Creditor’s organization and all other organizations of the Bank of China.

Article 8 Offset and Reservation of Rights

The surety shall pay the creditor’s rights within the range of suretyship in full under this contract without any claims of offset, unless with the permission of the creditor.

Any tolerance, extension of time limit or preference that the creditor provides to the surety or postpone of the creditor’s rights under this contract should not affect, harm or limit any rights of the creditor under this contract or any other laws. Such actions should not indicate that Party B gives up any rights or interests under this contract, and also it should not indicate exemption of any obligations of the surety under this contract.

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Article 9 Modification, Cancellation and Interpretation of the Contract

This contract is subject to modification, supplementation or cancellation with the written permission of both parties. Any modification or supplementation of this contract shall constitute an integral part of this contract.

The issues not provided in this contract shall be interpreted or treated in accordance with relevant provisions of the principal contract under suretyship of this contract.

If any provision in this contract becomes invalid, it shall not affect the validity of any other provisions of this contract.

Article 10 Applicable Laws, Settlement of Dispute and Management

The Laws of the People’s Republic of China are applicable to this contract.

Any dispute arising from execution of this agreement or in connection with this contract shall be settled by both parties through consultation. If no agreement can be reached through consultation, both parties agree to submit it to the People’s Court of the surety’s residence or the competent court specified in the principal contract for settlement.

Article 11 Validation of the Contract

This suretyship contract shall come into force from the date of signature of the legal representatives or authorized representatives of both parties or from the date of affixation of the official seals. The date whichever is later shall prevail.

This agreement has three originals, both parties and the creditor retains one respectively. All the originals have the same legal force.

Article 12 Special Notes

The surety and the creditor have fully consulted with each other on all the provisions of this contract.

The creditor has reminded the surety to pay special attention to the provisions concerning the rights and obligations of both parties to have a comprehensive and accurate understanding of these provisions. The creditor has provided explanation of above provisions at the request of the surety.

Surety:	Creditor:	Bank of China Limited                      Branch
Legal representative or authorized representative:	Authorized representative:
/s/    PHILIP A. HARDING	/s/    LIU LI

January 25, 2006

Site: The Bank of China Wuzhong Branch

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