AGREEMENT ON MOBILE COMMUNICATIONS EQUIPMENT
MAINTENANCE AND MODULATION
This Agreement is executed by and between the following two parties on
September 18, 2000 in Beijing:
PARTY A: BEIJING MOBILE COMMUNICATION COMPANY LIMITED
Legal representative: Dong Huiyi
Legal Address: 58 Dong Zhong Jie, Dong Cheng District, Beijing
PARTY B: BEIJING HUARUI WIRELESS COMMUNICATIONS EQUIPMENT INSTALLATION COMPANY
Legal representative: Guo Baocheng
Legal Address: Back Building, Long-distance Telephone Building,
Xi Cheng District, Beijing
WHEREAS:
1. In order to develop its mobile communications business and expand its
scope of services, Party A needs Party B to provide maintenance and
modulation services for Party A's mobile communications equipment .
2. Party B, a professional communications equipment service company,
agrees to provide Party A with maintenance and modulation services for
Party A's mobile communications equipment.
THEREFORE, Party A and Party B have reached the following agreement in
the principle of mutual benefit and reciprocity through friendly consultations.
ARTICLE ONE MAINTENANCE AND MODULATION SERVICES; SUBJECT MATTER
1.1. "Maintenance and Modulation Services" refer to maintenance and
modulation services to be provided by Party B for mobile
communications equipment in respect of which Party A enjoys the
property rights.
1.2. The subject matter of the Maintenance and Modulation Services is the
mobile communications equipment under Party B's maintenance, in
respect of which Party A enjoys the property rights.
ARTICLE TWO TYPE, QUANTITY, AND VALUE OF SUBJECT MATTER
2.1. The types and quantities of Party A's mobile communications equipment
covered by the Maintenance and Modulation Services provided by Party B
shall be determined as confirmed by the Parties.
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2.2. The value of Party A's communications equipment covered by the
Maintenance and Modulation Services shall be the original purchase
price of such equipment.
ARTICLE THREE MAINTENANCE AND MODULATION SERVICE FEE
3.1. Party B shall charge Party A the Maintenance and Modulation Service
Fee as agreed upon by the Parties in this Agreement.
3.2. The Maintenance and Modulation Service Fee shall be charged in
accordance with the State standards applicable to the
telecommunications industry:
The Maintenance Service Fee per year is the product of the original
purchase price of the communications equipment under maintenance times
.03% (in RMB).
The Modulation Service Fee shall be charged by reference to the
standards of modulation service fees specified in the document of "You
Bu [1995] No. 626", and shall be no higher than such standards.
3.3. Maintenance and Modulation Service Fee shall be charged in accordance
with the applicable national or municipal regulations. In the event of
any future adjustment to such regulations, the Parties shall observe
the standards as adjusted. Party A and Party B hereby confirm that the
standards of the Maintenance and Modulation Service Fee determined
under Article 3.2 are in compliance with the applicable national and
municipal regulations.
3.4. Party A shall prepay Party B, within 15 days after the execution date
of this Agreement, 50% of the Maintenance and Modulation Fee payable
for the current year, and, on or before the 15th date in the seventh
month after the execution date of this Agreement, another 30% of the
Maintenance and Modulation Fee payable for the current year. The
remaining portion of the Maintenance and Modulation Fee payable shall
be paid up by the end of the twelfth month after the execution date of
this Agreement.
3.5. Party B shall provide low-value consumables, tools and vehicles
required for the Maintenance and Modulation Services and shall bear the
relevant transportation and personnel expenses; Party A shall provide
Party B with spare units and spare parts required by Party B and bear
the software upgrading costs, if any.
3.6. The Parties shall verify the settlement of the Maintenance and
Modulation Service Fee on a semi-annual basis. On the basis of such
verification, overcharged Maintenance and Modulation Service Fee will
be refunded and deficiencies in payment will be made up, as the case
may be.
3.7. The Maintenance and Modulation Services to be provided by Party B will
start from September 18, 2000.
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ARTICLE FOUR QUALITY CONTROL
4.1. Before Party B starts any Maintenance and Modulation Services, the
Parties shall conduct joint testing and inspection of the
communications equipment, so as to determine its conditions and
quality status. Such conditions and quality status as determined by
the Parties will be kept on file.
4.2. Party A shall provide Party B with the relevant documents, spare parts
and fittings of the relevant communications equipment.
4.3. Party B shall maintain, in accordance with the relevant maintenance
procedures, the communications equipment covered by the Maintenance
and Modulation Services, and ensure that the Maintenance and
Modulation Services are provided in compliance with the relevant
standards and regulations. Party B shall also maintain the normal
operation of the communications equipment, satisfy Party A's
reasonable requirements, and provide Party A with the relevant reports
and data on a timely basis.
4.4. To the extent that the Maintenance and Modulation Services provided by
Party B fail to meet the relevant standards and regulations, and the
normal operation of any communications equipment is affected, 30% of
the Maintenance and Modulation Service Fee payable in the current half
year for such communications equipment shall be deducted if the
aggregate time of such failure exceeds 144 hours but less than 288
hours, or if single failure exceeding 24 hours occurs over 2 times but
less than 6 times, in such half year time; and 100% of the Maintenance
and Modulation Service Fee payable in the current half year for such
communications equipment shall be deducted if the aggregate time of
such failure exceeds 288 hours or single failure exceeding 24 hours
occurs 6 times in such half year time.
4.5. Party B shall hold harmless from and indemnify Party A against any
damages to Party A's communications equipment due to improper
maintenance, modulation and mismanagement on the part of Party B.
4.6. Party A has the right to conduct, on a regular or irregular basis,
quality inspections on the Maintenance and Modulation Services
provided by Party B.
4.7. Party A shall render assistance to Party B in respect of the
Maintenance and Modulation Services provided by Party B.
ARTICLE FIVE ADJUSTMENT TO MAINTENANCE AND MODULATION SERVICES
5.1. If Party B needs to entrust a third party to maintain Party A's
communications equipment covered by the Maintenance and Modulation
Services, Party B shall notify Party A in writing in advance and
obtain Party A's consent thereto. Notwithstanding the forgoing, Party
B shall continue to be responsible to Party A for such services
provided by such third party. Party B shall bear any and
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all increase in costs incurred in connection with the involvement of
such third party.
5.2 Upon prior written notice to Party B, Party A may entrust a third
party to provide maintenance and modulation services.
5.3 If Party A needs to relocate its communications equipment covered by
the Maintenance and Modulation Services provided by Party B, Party A
shall notify Party B in writing in advance and allow Party B a
reasonable period of time to make preparations for such relocation.
ARTICLE SIX ASSIGNMENT OF RIGHTS AND OBLIGATIONS
6.1 Party B may not assign any or all of its rights and obligations
hereunder without Party A's prior written consent thereto.
ARTICLE SEVEN CONFIDENTIALITY
7.1 The Parties hereto shall keep strictly confidential the other Party's
business data and information. Neither Party may, without the other
Party's written consent, provide or disclose to any other organizations
or persons any data or information with regard to the operations of
such other Party, unless such disclosure is required by the applicable
laws.
ARTICLE EIGHT LIABILITIES FOR BREACH OF CONTRACT
8.1 Any failure of either Party to perform any of the terms hereunder shall
be deemed as breach of contract. The breaching Party shall correct the
breach within twenty days from the date of receipt from the
non-breaching Party a written notice specifying such breach. If the
breaching Party fails to correct such breach within such twenty-day
period, the non-breaching Party may select to terminate the Agreement
upon written notice to the other Party, in which case the breaching
Party shall compensate the non-breaching Party for all economic losses
sustained by the non-breaching Party as the result of such breach.
ARTICLE NINE FORCE MAJEURE
9.1. Any event or circumstance beyond the reasonable control of a Party and
unavoidable by the affected Party by exercise of due care shall be
deemed as an "event of Force Majeure" and shall include, but not
limited to, earthquake, fire, explosion, storm, flood, lightning or
war.
9.2. Neither Party shall bear any liability for breach of contract if it
fails to perform all or any of its obligations hereunder as a result
of an event of Force Majeure. However, the Party or Parties affected
by an event of Force Majeure shall,
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within fifteen days of the occurrence of such event, notify the other
Party of the details of such event of Force Majeure along with the
relevant proof.
9.3. A Party/the Parties shall resume the performance of its/their
obligations hereunder after the effects of such event of Force Majeure
have been eliminated.
ARTICLE TEN GOVERNING LAW AND DISPUTE RESOLUTION
10.1 Any dispute arising from or in connection with the validity,
interpretation or performance of this Agreement shall be resolved by
the Parties through consultations. If no resolution can be reached
through consultations, either Party may submit such dispute to the
Beijing Arbitration Commission for arbitration in accordance with its
then effective arbitration rules. Once Beijing Mobile Communication
Company Limited is transformed into a wholly foreign-owned enterprise,
the dispute resolution institution shall be automatically changed to
China International Economic and Trade Arbitration Commission and any
dispute shall be resolved in accordance with its then effective
arbitration rules in Beijing. The award of such arbitration shall be
final and binding upon the Parties.
10.2 Except for matters under arbitration, the remaining part of this
Agreement shall be in effect during the time of arbitration.
ARTICLE ELEVEN NOTICES
11.1 Any notice or other document to be given under this Agreement shall be
delivered in writing and may be delivered in person, sent by
registered mail or transmitted by facsimile to both Parties at their
legal addresses stated in this Agreement or any other addresses a
Party may have notified the other Party in accordance with this
Article.
11.2 Any notice or document shall be deemed to have been received at the
time as follows:
if delivered in person, at the time of delivery;
if delivered by registered mail, five (5) business days after being
posted (excluding Saturdays, Sundays and public holidays); and
if transmitted by facsimile, upon receipt, or if the time of
transmission is during non-business hours, it shall be deemed to have
been given at the beginning of the normal business hours of the
succeeding day (excluding Saturdays, Sundays and public holidays),
subject to proof by the sender or confirmation from the facsimile
machine used for transmission that a satisfactory transmission has
been completed.
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ARTICLE TWELVE EFFECTIVENESS AND TERM OF AGREEMENT
12.1 The effective term of this Agreement shall commence on the date on
which it is affixed with the official seals of and executed by the
Parties and expire on September 18, 2001. Unless a Party notifies the
other Party in writing of its intention to terminate this Agreement
three months prior to the expiration date hereof, this Agreement shall
automatically be extended for one year upon the expiration of its
term. The times of such extension shall be unlimited.
12.2 Party B hereby acknowledges that Party A may be transformed into a
wholly foreign-owned enterprise during the term of the Agreement
without consent or acknowledgement by Party B either prior to or after
the event, and that Party A's entire rights and obligations under the
Agreement shall not be affected or changed on the ground that the
nature of the company has changed into a wholly foreign-owned
enterprise. Party B will acknowledge the legal status of such wholly
foreign-owned enterprise in performing this Agreement.
12.3 In the event that the following conditions are not met, Beijing Mobile
Communication Company Limited shall be entitled to terminate this
Agreement at any time. After the termination of this Agreement, the
Parties shall cease to enjoy any rights or assume any obligations
under this Agreement or in connection with its termination, except the
rights and obligations that have incurred under this Agreement prior
to such termination.
(1) China Mobile (Hong Kong) Limited ("CMHK") shall have been
granted relevant waivers by the Stock Exchange of Hong Kong
Limited ("HKSE") for CMHK's connected transactions in
accordance with the listing rules of HKSE; and
(2) The independent shareholders of CMHK who are deemed to be
independent in accordance with the listing rules of HKSE
shall have approved relevant transactions.
ARTICLE THIRTEEN MISCELLANEOUS
13.1 During the performance of this Agreement, any provision that may
become invalid or unenforceable will not affect the validity of any
other provisions hereof.
13.2 Any matter not covered herein may be supplemented, explained, and
interpreted in a supplementary agreement or appendix to be entered
into by the Parties. All supplementary agreements and appendices
hereto shall constitute an integral part of, and have the same force
and effect as, this Agreement.
13.3 The specific details and quantities of each item of service hereunder
and the Parties' rights and obligations under such item of service
shall be determined by the Parties hereto by mutual agreement in
accordance with the basic principles and terms specified herein, and
shall be performed, as an appendix
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hereto, by the Parties upon the execution of such agreement.
13.4 The Parties hereby acknowledge that Party A will replace "Beijing
Mobile Communication Company" as a party to the "Agreement on Mobile
Communications Base Station Maintenance" ("Original Agreement")
entered into by "Beijing Mobile Communication Company" and Party B
hereto, and will assume all relevant rights and obligations of
"Beijing Mobile Communication Company" thereunder. Upon the execution
of this Agreement, the mobile communications base station maintenance
arrangement, if any, between the Parties hereto shall be implemented
in accordance with the economic terms of the Original Agreement and
under this Agreement. If the relevant terms hereunder are in conflict
with any terms under the Original Agreement, the mobile communications
base station maintenance arrangement between the Parties shall be
implemented in accordance with such terms under such Original
Agreement. Such Original Agreement shall be deemed to constitute an
appendix to this Agreement.
13.5 This Agreement is written in Chinese and signed in four counterparts.
Each Party will hold two copies, and all copies shall be signed by the
legal representative or authorized representative of each Party or
affixed with its official seal.
ARTICLE 14 APPENDIX
The "Agreement on Mobile Communications Base Station Maintenance"
between "Beijing Mobile Communication Company" and Party B hereto shall be
incorporated by reference hereto as an appendix to this Agreement.
PARTY A: BEIJING MOBILE COMMUNICATION PARTY B: BEIJING HUARUI WIRELESS
COMPANY LIMITED COMMUNICATIONS EQUIPMENT
INSTALLATION COMPANY
By: s/Sha Yuejia By: s/Guo Baocheng
---------------------------------- -------------------------------
Legal or authorized representative Legal or authorized representative
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APPENDIX
AGREEMENT ON MOBILE COMMUNICATIONS
BASE STATION MAINTENANCE
Beijing Mobile Communication Company ("Party A") and Beijing Huarui
Wireless Communications Equipment Installation Company ("Party B") hereby reach
the following agreement regarding the routine maintenance to be provided by
Party B for Party A's certain mobile communications base stations.
I. Responsibilities of the Parties
1. Responsibilities of Party A:
a. Formulating and modifying the Agreement, the items of
maintenance, and the standards of maintenance;
b. Providing Party B with information on the quantities, names,
codes, and addresses of the base stations to be maintained,
as well as door keys to such stations;
c. Paying expenses for the spare parts of the equipment to be
maintained by Party B;
d. Supervising and inspecting the maintenance services and
providing guidance therefor;
e. Determining maintenance fees payable to Party B and providing
assistance with Party B's settlement matters; and
f. Making random inspections on the maintenance status of the
base stations. Base stations randomly inspected in this way
shall be no less than 5% of the total. If Party B is found
not to maintain the base stations on schedule, the
maintenance fee for that month on the item(s) Party B fails
to maintain shall be deducted on a pro rata basis. If an item
of maintenance fails to pass Party A's inspection, Party A
will make a warning to Party B for the first time, a
criticism for the second time and a pro rata deduction of the
maintenance fee for the current month on such item for the
third time.
2. Responsibilities of Party B:
a. Performing the Agreement; ensuring a monthly maintenance
cycle shorter than 30 days, a quarterly maintenance cycle
shorter than 3 months, an semi-annual cycle shorter than 6
months, and an annual cycle shorter than 12 months; strictly
implementing the maintenance requirements on power,
air-conditioning, antennas and the environment of base
stations (see Annexes I-IV);
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b. Carefully keeping maintenance records and the base station
maintenance on-site registration forms (see Annexes V-VIII);
submitting, by the fifth day of each month, to Party A a
report on the base station maintenance status in the previous
month and a base station maintenance plan for the current
month. Overdue reports or incomplete data will be deemed as
failure of maintenance or substandard maintenance;
c. Formulating appropriate maintenance management regulations;
ensuring the maintenance quality; providing sufficient
maintenance labor force, vehicles, instruments and meters;
d. Immediately notifying Party A any problems it detects in the
process of the maintenance work; making arrangements to
address such problems detected. Any breakdown recovery period
shall be no longer than 24 hours;
e. Replacing broken down spare parts during maintenance, subject
to Party A's prior consent. Party B shall stock certain
quantities of spare parts for emergency use. Actual expenses
aggregating over RMB 50,000 are reimbursable upon the
approval of the General Business Division of the Network
Department;
f. Causing its maintenance personnel to observe the relevant
regulations of the owners and Party A's base station
management regulations;
g. Assigning, upon notice, relevant personnel to handle
emergency circumstances or contingent matters;
h. Strengthening safety education for its maintenance personnel
so as to ensure personal safety. In the event of any safety
accident, Party B shall be held liable; and
i. Ensuring the safety of the equipment under its maintenance.
In the event of any man-made communications outage, Party B
shall make compensations for Party A's economic losses. The
maintenance fee will also be deducted on the basis of the
gravity of such outage.
II. Maintenance Cycle and Maintenance Requirements (see Annexes I-IV)
III. List of Base Stations to be Maintained (see Annex IX)
IV. Base Station Maintenance Items and Costs
Agreement on Mobile Communications Equipment Maintenance and Modulation - Beijing Mobile Communication Co. Ltd. and Beijing Huarui Wireless Communications Equipment Installation Co.
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