Contract - UTStarcom (China) Ltd. and Henan Telecommunications Corp.
Contract No.: UTA-BJ-0011-004 Project No.: PAS
The Buyer: The Seller:
Henan Telecommunications Corporation, UTStarcom (China) Ltd.
No. 216 Zhong Zhou Zhong Street, 11th Floor, CNT Manhattan Building,
Luoyang, 471000 No. 6 Chao Yang Men Bei Da Jie Street,
Tel: (0379) - 9937662 Tel: (010)-65542030
Fax: (0379) - 3942706 Fax: (010)-65542058
This contract is made between the Buyer and the Seller, whereby the
Buyer agrees to buy and the Seller agrees to sell the under-mentioned
commodities according to the terms and conditions as stipulated hereinafter: PAS
Wireless Citywide Telephone System.
1. Total Contract Price: [*]
2. Name of Commodities or Services: PAS Citywide Telephone System for
Henan telecommunications Corporation, Luoyang Branch.
(Please refer to the attached list for quantity, specifications
and unit price.)
3. Date of Shipment: [*].
4. Place of Destination: Henan telecommunications Corporation, Luoyang
Branch (No. 216 Zhong Zhou Zhong Street Luoyang) and Yanshi
The goods shall be packed in new strong cases suitable for long
distance transportation and well protected against dampness, moisture,
shook and rust. The Seller shall be liable for any damage to the goods
on account of improper packing.
6. Shipping Marks:
The Seller is required to mark clearly on the surface of each
package the package number, measurements and such cautions as "This
Side Up", "Handle with Care" and "Keep Away from Moisture" in unfading
ink and put on shipping marks.
7.1 The Seller shall bear all the expenses and risks involved in the
handling of the goods until the moment when the goods have
officially been handed over to the relevant transportation unit
designated by the Buyer.
7.2 The transportation and insurance costs from Hangzhou or Huizhou
Railway Stations (or from the Sellers' warehouse, if shipped by
highway) to the place of destination designated by the Buyer
shall be borne by the Buyer.
8. Acceptance of Goods:
8.1 Upon arrival of the goods, the Buyer shall check the goods
immediately in the presence of the Seller's representative and
sign on the shipping list as a certificate of acceptance of the
goods. If shipped by air, railway or postal service, the
carrier's shipping list shall serve as a certificate of
acceptance of the goods.
8.2 In case of missing parts or damages due to the Seller's improper
packing, the Buyer shall make a detail record, or commission the
China Commodity Inspection Bureau for a reexamination and
issuance of a certificate, or require the representatives of the
Buyer and the Seller to sign a memorandum to serve as a
certificate for the replacement of missed or damaged parts. If
the Buyer opens the cases by itself or fails to make a written
claim on missing or damaged parts within [*] upon arrival of the
goods, the Buyer shall be deemed to have accepted the goods.
9. Terms of Payment:
If the payment by the Buyer to the Seller is made in [*], the
exchange rate shall be based on the average price of a given foreign
currency published by the People's Bank of China on the same day when
the Seller receives such payment.
The payment shall be made by T/T to Beijing Industry and Commerce
Bank of China, Chao Yang Branch, Ri Tan Lu Office, for the account
9.1 Terms of Payment for the Equipment as Follows:
9.1.1 Down Payment
[*] of the total contract price, or [*] shall be paid
as down payment by the Buyer to the Seller within [*] upon
execution of the Contract.
If the down payment is delayed, the date of shipment
for the goods will be delayed accordingly.
9.1.2 Payment upon Arrival of the Goods
[*] of the total contract price, or [*] shall be paid
by the Buyer within [*] upon arrival of all the equipment.
9.1.3 The remaining [*] of the total contract price, or [*] shall
be paid by the Buyer within [*] upon certification of
quality of final test or within [*] upon arrival of the
goods, whichever is earlier.
9.2 In the event that a payment required by Section 9.1 is not made
by the Buyer within the stipulated time, the Buyer shall pay to
the Seller, in addition to the amount owned, a late payment
penalty equal to [*] of the amount owned per week. Any fractional
part of a week is to be considered as a full week. The total
amount of late payment penalty shall not, however, exceed [*] of
the total amount owned.
10. Equipment Installation:
10.1 The Buyer is responsible for the installation of the equipment.
10.2 The Seller is responsible for the technical support during the
installation of the equipment.
11.1 The Seller warrants the equipment supplied hereunder to be free
from defects in workmanship and materials. The Seller's warranty
for equipment and materials will commence upon delivery of the
goods and will continue for a period of [*]. During the warranty
period, the Seller will, at its option, either repair or replace
those equipment and materials not in conformity with the
aforementioned warranty. If the Buyer determines that certain
parts be returned to the Seller, the [*] shall bear the
transportation cost for the return of such parts inside China and
for the return of the repaired or replaced parts to the Buyer's
11.2 The Seller warrants to eliminating errors from the software it
11.3 The foregoing warranty does not extend to any equipment or part
that has been:
11.3.1 Damaged due to improper use or accidents;
11.3.2 Wired, repaired or altered by anyone other than the Seller
or its representatives;
11.3.3 Damaged due to improper installation, storage, handling or
maintenance by anyone other than the Seller or its
11.3.4 Removed from its original site of installation, or due to
expendable components such as fuses, light bulbs, motor
brushes and the like.
12. Force Majeure
The Seller shall not be liable for any loss, damage, delay of the
goods or failure of their performance resulting directly or indirectly
from any cause which is beyond its reasonable control, which includes
but is not limited to the laws, regulations, acts of any government
13. Late Delivery and Penalty:
In case of delayed shipment, except for force majeure, the Seller
shall pay to the Buyer for every week of delay a penalty amounting to
[*] of the total value of the goods whose shipment has been delayed.
Any fractional part of a week is to be considered as a full week. The
total amount of penalty shall not, however, exceed [*] of the total
value of the goods involved in late shipment and is to be deducted
from the amount due at the time of payment.
The parties shall strictly execute this Contract in accordance
with the relevant laws and regulations of the PRC. All disputes
arising out of the execution of the Contract shall be settled through
mutual understanding and friendly negotiations. In case no settlement
can be reached through negotiations, either party can apply to the
appropriate organization for arbitration or medication. The
arbitration fees shall be borne by the losing party.
15. Limitation of Liability
15.1 In the event of any breach of this Contract by the Seller, or of
any losses or injuries to the Buyer arising out of this Contract
for which the Seller is liable, the Seller's total cumulative
liability for such breaches, losses and injuries shall be the
a. The actual value of the damages or losses caused to the
b. The total payment made to the Seller.
15.2 The Seller shall not be liable for any consequential or
incidental losses or damages resulting from this Contract.
16. Validity and Termination of the Contract and Miscellaneous Matters:
16.1 This Contract will come into force upon affixation of the seals
by the parties and execution by the representatives of the
16.2 This Contract will be terminated upon fulfillment of the
respective duties and obligations by the parties.
16.3 The Seller hereby grants the Buyer the license to use the
software contained within the equipment purchased. The Buyer or
its representatives shall not de-compile, disassemble or reverse
the software unless consented in writing by the Seller.
16.4 This Contract can only be amended by an instrument in writing
signed and sealed by the duly authorized representatives of the
16.5 During the course of performance of this Contract, all notices
between the parties shall be delivered by telex, facsimile or
16.6 This Contract is made in both Chinese and English, and the
versions in two languages shall be equally authentic. In case of
discrepancy between the two versions, the Chinese version will
The Contract is made in two originals, of which each party holds
Henan Telecommunications Corporation, Luoyang Branch
Date: October 28, 2000
UTStarcom (China) Ltd.
Date: October 28, 2000