EXHIBIT 10.10
MASTER SERVICES SHARING AGREEMENT
BY AND BETWEEN
CHINA NETWORK COMMUNICATIONS GROUP CORPORATION
AND
CHINA NETCOM (GROUP) COMPANY LIMITED
MASTER SERVICES SHARING AGREEMENT
This Master Service Sharing Agreement ("THIS AGREEMENT") is made and
entered into on [-], 2004 in Beijing, People's Republic of China ( "PRC") by and
between the following parties:
Party A: China Network Communications Group Corporation
Address: No. 156, Fu Xing Men Nei Da Jie, Xi Cheng Qu,
Beijing, China
Legal representative: Zhang Xxxx Xxxxx
Party B: China Netcom (Group) Company Limited
Address: Xxxxxxxx X, Xx.000, Xxxxxxxxxxxx Xxxxxx, Xxxxxxx
Xxxxxxxx, Xxxxxxx, PRC
Legal representative: Zhang Xxxx Xxxxx
Whereas:
(1) Party A is a state owned enterprise organized existing under the
laws of China; and
(2) Party B is a foreign-invested company organized and existing under
the laws of China, which is ultimately controlled by Party A.
On equal and fair basis, both Party A and Party B reach the following
agreement on master services sharing after friendly negotiation:
1 BASIC PRINCIPLE:
1.1 Either party hereto is entitled to reasonable service fees on a fair and
reasonable basis for any services and/or facilities provided to another
party under this Agreement that are payable transactions during economic
activities between both parties, where the another party shall make
payments for such services and/or facilities.
1.2 The conditions of the services and/or facilities under this Agreement
provided by either party to another shall be equal to the same or similar
services and/or facilities provided by such party to any third party.
1.3 Provided either party requires another party to add the provision of the
services and/or facilities under this Agreement, the required party shall
make every effort to provide the services and/or facilities required to
add
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by the requiring party with equal conditions to the same or similar
services and/or facilities it provided to any third party.
1.4 Either party shall give written notice to another party immediately for
its failure to provide, fully or partly, the services and /or facilities
under this Agreement due to reasons other than its default, and make every
effort to assist another party to obtain the same or similar services
and/or facilities from other channels.
1.5 The provision of services and/or facilities under this Agreement must be
for purposes agreed by both parties and in compliance with relevant
standards required by the government.
1.6 Either party shall take immediate and full breach liabilities for any
losses (including but not limited to the direct or indirect losses
suffered by another party due to its breach) suffered by another party due
to its breach of this Agreement, provided however, its shall be exempted
from liabilities for any losses suffered by another party caused by force
majeure.
1.7 When either party performing its obligations under this Agreement, another
party shall provide all reasonable and necessary assistance.
1.8 Both parties confirm thereby that both parties are obliged to take other
necessary actions and measures to realize the purpose and contents of this
Agreement, and in case that Party B will act as an subsidiary of the
proposed to list or listed China Netcom Group (Hong Kong) Limited, to
comply with the regulations of the Listing Rules of Hong Kong Stock
Exchange with respect to related-party transactions.
2 DEFINITION
2.1 Master services sharing refers to the services agreed by both parties to
be provided to or received from another party in accordance with the terms
and conditions agreed in this Agreement, including but not limited to: (1)
large customer management services, network administration services and
head office human resources services provided by Party B to Party A; (2)
business support center services provided by either party to another; (3)
premises provided by Party A to Party B and other service sharing listed
by the head office.
3 LARGE BUSINESS CUSTOMERS SERVICES
3.1 Party B shall be responsible for provisions of one-stop domestic and
international services for large business customers to Party A, details as
follows::
(1) marketing over large business customer for Party A's networking and
one-point business processing, including collection of customer
information, customer relationship management and customer demands
investigation and analysis, etc;
(2) bidding competition in Party A's networking project, including
business consultation on networking
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technologies, design of networking plan, bidding, negotiation of
networking contracts, review and conclusion of contracts, etc;
(3) providing demands for inter-provincial digital and data leased
lines, conducting resources review, distributing business notices,
coordinating and resolving various problems arising during operating
commission;
(4) bearing of large business customer marketing expenses, bidding
marketing expenses and partial daily expenses;
(5) provision of technical support in nationwide networking projects,
executive public relations and policy support;
(6) product development for large business customer and market research;
(7) settlement and collection/payment;
(8) management of service quality to Party A's customers and processing
of complaints.
3.2 Obligation of Party A
Party A is obliged to assist Party B in providing end-to-end services to
large business customers.
3.3 Obligation of Party B
Party B shall provide customers with services of the quality in compliance
with the customer service quality standards agreed by both parties.
4 NETWORK ADMINISTRATION SERVICES
4.1 The network administration service provided by Party B to Party A
includes:
(1) maintenance management, version management, data deployment
management and operation quality management of transmission network,
telephony network (including international network and intelligent
network), data network (including DDN, ATM/FR and IP) and various
support network; monitoring the operation of Level I trunk network,
instructing daily circuit, route and flow scheduling of
inter-provincial long distance network, processing Party A's reports
and troubleshooting;
(2) resource management, end-to-end scheduling management and network
routing management of transmission network, telephony network, data
network and various support network, and resources
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distribution, equipment connection, networking and development of
network reconstruction plans for distance Level I trunk network;
(3) providing periodical, or upon required by Party A, network operation
analysis and resource utility report of transmission network,
telephony network, data network and various support network;
(4) maintenance of the following system hardware/software and data of
Party A: telephony network administration system, data network
administration system, transmission network administration system,
ISUP network/synchronous network/DCN network administration system,
network resource management system, administration website and
maintenance website.
4.2 Obligations of Party A
(1) Party A should assist Party B in network operation administration in
accordance with network administration regulations.
(2) Party A should ask services from Party B in a planned manner, such
as resources scheduling, optic fiber and circuit connection, etc..
(3) Party A should immediately provide Party B with the network change
plans and failures within the province Party A located in. .
4.3 Obligations of Party B
(1) Party B should ensure that the network service quality is better
than the relevant standards set by the Ministry of Information
Industry and resource utility rate should achieve the target agreed
by both parties. The target will be stipulated in separate document.
(2) Party B should be available 24 hours a day and 7 days a week (24 x 7
hours) to insure real time monitor network operation and process
failure complaints.
(3) Party B should respond to Party A's general complaints and service
requests within 5 working days. The serious malfunctions should be
resolved in the timeframe as stipulated by the Ministry of
Information Industry.
(4) Party B should ensure a network utility rate of 99.9%.
5 HEAD OFFICE HUMAN RESOURCES SERVICES
5.1 Party B should provide such human resources services to Party A as sharing
head office administrative staff and operation management staff..
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6. BUSINESS SUPPORT CENTER SERVICES
6.1 Party B should provide the following business support center services to
Party A:
(1) collecting, pricing and monthly billing of international
telecommunications business data and settlement with overseas
providers;
(2) collection and collection of roam data for overall network
businesses, including but not limited to intelligent network (such
as 300 and 800), IP card and PHS short messages, etc and
inter-provincial roam billing;
(3) settlement of overall network with other domestic providers or
settlement entities;
(4) processing internal-network settlement;
(5) settlement between Party A's provincial branches and other national
telecom service providers commissioned by Party A;
(6) providing relevant organizations of Party A with service data
statistics report;
(7) responsible for the billing operations of VoIP and 167 services of
former Jitong Network Communications Stock Company Limited.
6.2 The business support center services offered by Party A to Party B
include:
(1) Undertaking the production and distribution of various phone cards
and IC cards(hereinafter referred to as "telecommunication card")
over Party A's backbone intelligent networks, including
identification, assessment and management of qualifications of card
providers and related raw material providers; responsible for
inviting card providers to tender, and entering into
telecommunication card procurement framework agreement; responsible
for production data generation, encrypted data transmission, key
production, and quality and security management of telecommunication
card, as well as supervising implementation of agreement between
card provider and provincial subsidiary; responsible for planning
out annual theme scheme of telecommunication card, and administering
design and review of contributions; responsible for directing
related provincial subsidiaries in ordering and manufacturing
telecommunication cards according to the annual theme scheme of
telecommunication card; responsible for the conclusion,
implementation of coded cards agreement, and the production thereof
thereafter;
(2) Responsible for the operational maintenance, technical support and
upgrade of the telecommunication card business support system;
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(3) Responsible for management of telecommunication card services,
including the development of regulations on the production and the
graphics and context design of telecommunication card; responsible
for gathering business statistics of various cards and performing
operational analysis;
(4) Responsible for inter-provincial and inter-network settlement of IC
card, and gathering, checking and distributing data arising from
interprovincial 300, 800 and IC card services;
(5) Responsible for taking up consigned orders for made-to-measure cards
targeting at national market and distribution of these cards, and
moreover, the development and promotion of service varieties of
national cards and advertisement cards;
(6) Works at the telecommunication card customer service center operated
by Party A.
6.3 Obligations of both Parties
(1) Party B shall complete all international settlement, inter-networks
settlement and inter-provincial settlement timely and exactly in
accordance with rules enacted by the Ministry of Information
Industry of State Council and inform Party A as required.
(2) Party A shall complete the design and production of cards printed
with nominal value without falling short of the agreed time-limit,
quantity and quality requirement.
(3) Party A shall timely accomplish other business demands by Party B
according to the actual status of business system and network
capacity.
7. OTHER SHARING SERVICES LISTED BY THE HEAD OFFICE
Party A will provide Party B with other sharing services listed by the
head office, such as advertising, promotion, business hospitality,
maintenance and property management etc.
8. USE OF PREMISES
8.1 Purpose of Premises
(1) Party A agrees to provide its office building (including air
conditioner, power supply, electronic equipments and other related
facilities etc contained therein.) located at 000 Xxxxxxxxxxxx
Xxxxxx, Xx Xxxxx Xxxxxxxx, Xxxxxxx to Party B for its use in
accordance to the requirement of Party B.
(2) Party B shall use above-mentioned premises as its primary office
building..
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8.2 Warranties and Undertakings
Party A undertakes that it has the right to provide the premises mentioned
above (including air conditioner, power supply, electronic equipments and other
related facilities etc contained therein) to Party B for its use. Party A agrees
to assume and compensate all losses of Party B due to any failure or damage to
its right under this Agreement as a result of any dispute against the ownership
and/or use right of Party to such properties from any third party in any case
and for any reason. Party A undertakes to provide Party B's auditors with
accounting reports of connected transactions of Party A and connected persons.
10 COST ALLOCATION FOR SHARED SERVICE
Both parties agree that: the costs incurred by the large customer
management services, network management services, head office human resource
services provided by Party B to Party A; the business support center
service provided by both parties to each other and the site provided by Party A
to Party B as well as other shared services listed by the head office should be
allocated in proportion to the income of each party (the income of Party A
should not include the income of its overseas subsidiaries and Party B). The
specific allocation proportion will be determined by the income listed in their
financial statements submitted to each party through consultation. The cost
allocation cycle is one year.
10 REPRESENTATION, WARRANTIES AND UNDERTAKINGS
Both parties hereto have made the following statements, commitments and
undertakes to each other:
(1) it has the full right and authority to sign this Agreement and its
appendixes (including but not limited to obtaining approvals,
consents and permissions from relevant governmental authorities);
(2) Any terms of this Agreement and its appendixes are not in violation
of the regulatory documents of each party and Chinese law and
regulations.
11 FORCE MAJEURE
Either party shall give immediate notice to another party for its failure
to perform relevant obligations under this Agreement and Appendixes hereto as
agreed as a result of force majeure that is unforeseeable, and the occurrence
and results of which cannot be prevented or overcome, and provide, within
fifteen (15) days, the detailed information as well as valid evidencing
documents for the reasons of its failure or delay to perform the obligations,
fully or partly, under this Agreement and Appendixes hereto. Depending on the
effect of the force majeure on the performance of such obligations,, both
parties shall determine through negotiation whether to terminate, partly exempt
or extend the performance of such duties.
12 CONFIDENTIALITY
Unless otherwise stipulated or required by law or relevant regulatory
authorities, or for the purpose of listing,
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without prior written consent from another party, neither party shall make any
announcement about or provide or disclose any materials and information
concerning the business of another party or the content of this Agreement to any
companies, enterprises, organizations or individuals.
13 TRANSFER
Without prior written consent from another party, neither party shall
transfer any rights or obligations under this Agreement
14 NON-WAIVER
Unless otherwise specified by law, the failure or delay of exercising the
rights, powers or privileges as endowed by this Agreement on the part of any
Party cannot be deemed as the waiver of such rights, power or privileges.
Besides, the partial exercise of such rights, powers or privileges should not
hinder the exercise of such rights, powers or privileges of this Party in the
future.
15 NOTICE
15.1 All notices required to be delivered pursuant to this Agreement shall be
in writing, and delivered to the address as stated at the beginning part
of this Agreement, or to addresses or facsimile numbers designated by one
Party to the other Parties in writing from time to time.this Agreement
15.2 Any notice above shall be delivered either by hand, registered mail, or
facsimile. Any notice shall be deemed to have been delivered at the time
of actual receipt if delivered by hand; on the date of return receipt if
delivered by registered mail; and at the time of transmission if delivered
by facsimile.
16 GOVERNING LAW
This Agreement is governed by and shall be construed and executed in
accordance with laws of the PRC.
17 DISPUTE RESOLUTION
In case of disputes as to the power, interpretation or implementation of
this agreement, both parties shall seek to settle the matters of dispute by
friendly negotiation. If the matters of dispute cannot be settled by negotiation
within thirty (30) days from the day the matters of dispute arise, either party
has the right to resort to litigation at the people's court which has
jurisdiction over where Party A situates.
18 EFFECTIVE DATE AND MISCELLANEOUS
18.1 This Agreement will come into effect , upon executed and sealed by the
legal representatives or authorized representatives of both parties for a
period until June 30, 2007. If Party B notifies party A of its intention
to
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renew this Agreement three (3) months before the expiration date, this
Agreement will be automatically extended for another three (3) years upon
expiration with the same terms and conditions as this Agreement. The
renewal times are unlimited.
18.2 The Appendixes hereto are parts of this Agreement with the same
effectiveness as the main body of this Agreement.
18.3 Both parties hereto may enter into other necessary executing documents
concerning the performance of sharing service under this Agreement.
18.4 This Agreement may be amended or supplemented as agreed by both parties.
All such amendments or supplements shall come into effect only upon
executed or sealed by the legal representative or authorized
representative of both parties.
18.5 This Agreement is severable, that is, if any terms of this Agreement and
its appendixes are determined to be illegal or unenforceable, it shall not
affect the effectiveness and enforcement of the remaining terms in this
Agreement and its appendixes., .
18.6 This Agreement was made in four (4) copies with equal effectiveness. Each
party shall keep two (2) copies.
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Signature Page:
CHINA NETWORK COMMUNICATIONS GROUP CORPORATION (Company Seal)
Legal Representative or authorized Representative ____________
CHINA NETCOM (GROUP) COMPANY LIMITED (Company Seal)
Legal Representative or authorized Representative ____________
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