This Bailment Agreement entered into on this ___ day of _____________, 2000 entered into between X A.G. (hereinafter called " X ") and K.K. Y (hereinafter called " Y ") on bailment of X 's products,

W I T N E S S E T H:

Article 1. (Bailment)

(1) X bails to Y its products, which X owns or possesses (hereinafter called "Cargoes") and entrusts Y with warehouse in/out operation and other operation with respect thereto, and Y agrees to store them and carry out warehouse in/out operation and other operations with respect thereto on X 's behalf.

(2) Y shall store Cargoes and carry out warehouse in/out operation and other operation with respect thereto with the care of a good manager.

Article 2. (Notification of Cargoes Information)

When X bails Cargoes to Y , X shall inform Y of names of items, marks, quantity, and the value using the Request for Bailment ("Kitaku Moushikomi-sho").

Article 3. (Notification of Cargoes Damages/Loss)

When Y finds any damage to Cargoes or any difference in quantity from the ones described in the Request for Bailment, upon receipt of Cargoes at its warehouse, Y shall inform X of the details as soon as possible for further instruction.

Article 4. (Receiving Report)

When Y receives Cargoes, Y shall inspect the Cargoes and send a Receiving Report ("Nyuuko Houkoku-sho") to X specifying particulars of the received Cargoes such as names, marks, quantity, etc.

Article 5. (Delivery Procedures)

(1) The authorized X personnel for the purpose of giving instructions from X to Y shall be as follows:

Mr. ABC - X AG
Mr. DEF - X AG Japan Branch

(2) The delivery instruction may be sent by X by fax in the form of Delivery Instruction ("Shukko Shiji-sho") with the authorized personnel's signature or stamp ("Inkan").

Article 6. (Delivery Report)

Y shall inform X by fax in the form of Delivery Report ("Shukko Houkoku-sho") particulars of the delivered Cargoes such as names of items, marks, quantity, etc., upon completion of delivery.

Article 7. (Notification of Cargoes Conditions)

Upon notice of the likelihood or the result of damage or loss caused or being caused to Cargoes during storage, Y shall inform X of details of Cargoes conditions for further instruction by X .

Article 8. (Compensation for Damage)

Should any damage or loss to Cargoes be caused during storage or during the warehouse in/out operation of Cargoes in Y , Y shall be fully responsible for such loss or damage.

Article 9. (Inspection of Cargoes)

Y shall inspect Cargoes conditions from time to time, and provide X with necessary suggestion related to storage of Cargoes.

Article 10. (Confidentiality)

Y shall not use for any purpose other than for the purpose of performance of the obligations hereunder, nor disclose to any third parties or Y 's employees who are not in charge, any information which has been provided or disclosed by X , or which Y came to know during the performance of this Agreement. Y 's obligation under this Article shall survive the termination of this Agreement.

Article 11. (Fire Insurance)

Y shall insure Cargoes against fire at its account, with respect to all of the bailed Cargoes. The insured value should be equal to the value of the Cargoes declared by X .

Article 12. (Service Fee)

Y 's service fee for storage, warehouse in/out operation, other operation, transportation, etc. shall be separately agreed.

Article 13. (Term)

This Agreement is valid from ___________, 2000 until ____________, 2001. The term of this Agreement shall be extended for successive periods of one year each unless there is a written notice to terminate this Agreement by either X or Y to the other party, 6 months prior to the expiring date of this Agreement.

Article 14. (Termination)

X may terminate this Agreement upon occurrence of any of the following:

   (a) Y defaults the performance of its material obligations under this Agreement and does not cure such default within ten (10) days after receipt of a notice to such effect from X ;
(b) Any checks or bills drawn by Y becomes dishonored;
(c) Attachment, provisionsl attachment, provisional disposition, coercive collection ("Taino Shobun") or any procedures similar to the foregoing have been taken against Y or filing of official auction is raised against Y ;
(d) An application of dissolution of company ("Seiri"), commencement of procedures for civil rehabilitation ("Minji Saisei"), petition for bankruptcy ("Hasan") or corporate reorganization ("Kaisha Kousei") is filed by or against Y ;
(e) Y passed a resolution on discontinuance of its business or liquidation (except in the case of merger); or
(f) There exists insolvency, over debts or any other cause which has deteriorated or is reasonably expected to deteriorate Y 's financial conditions.
(g) Y damages X 's reputation in any way, or occurrence of any event which makes is difficult for X to continue the transaction hereunder with Y .

Article 15. (Premature Termination of Agreement)

Either Y or X may terminate this Agreement by giving 3 months advance notice in writing to the other party, any time during the term of this Agreement.

Article 16. (Jurisdiction)

The Tokyo District Court shall have an exclusive jurisdiction over any disputes concerning this Agreement.

IN WITNESS WHEREOF, X and Y have caused this Agreement to be executed in duplicate, each party retaining one copy.

X A.G.

By _______________

K.K. Y

By _______________