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EXHIBIT 10.6
AGREEMENT
REGARDING THE ROAMING SETTLEMENT OF
"SHENZHOUXING" PRE-PAID SERVICES
AND REVENUE SHARING OF SALES OF ADDED VALUE FOR
VALUE-ADDING CARDS
BETWEEN
CHINA MOBILE COMMUNICATIONS CORPORATION
AND
CHINA MOBILE (HONG KONG) LIMITED
DATED AS OF OCTOBER 4, 2000
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AGREEMENT REGARDING THE ROAMING SETTLEMENT
OF "SHENZHOUXING" PRE-PAID SERVICES
AND REVENUE SHARING OF SALES OF ADDED VALUE FOR VALUE-ADDING CARDS
This Agreement is executed by the following two parties on October 4,
2000 in Beijing:
CHINA MOBILE COMMUNICATIONS CORPORATION, a wholly state-owned corporate
entity duly established and existing under the laws of the People's Republic of
China, with its legal address at 53 A, Xibianmen Nei Da Jie, Xuanwu District,
Beijing, PRC ("Party A"); and
CHINA MOBILE (HONG KONG) LIMITED, a limited liability company duly
established and existing under the laws of Hong Kong, with its legal address at
60th Floor, the Center, 99 Queen's Road Central, Hong Kong, China ("Party B").
WHEREAS:
1. Party A currently implements centralized management nationwide of the sales
of the Pre-paid Cards and Value-adding Cards, the interconnection and roaming
services among networks and the related account settlement in connection with
the "Shenzhouxing" Pre-paid Cards and Value-adding Cards service.
2. Party B is a company listed on the Stock Exchange of Hong Kong Limited
("HKSE") and the New York Stock Exchange, Inc., with about 25% of its issued and
outstanding shares being held by overseas investors, and Party A is its indirect
controlling shareholder;
3. Party B's current six operating subsidiaries own and operate the cellular
mobile phone networks previously owned by Party A in the provinces of Guangdong,
Zhejiang, Jiangsu, Hainan, Fujian and Henan (collectively, Party B's "current
operating regions");
4. In accordance with Party B's acquisition proposal as approved by the relevant
department of the State Council, Party B desires to acquire the cellular mobile
phone networks previously owned by Party A in the provinces, municipalities and
autonomous region of Beijing, Tianjin, Shanghai, Liaoning, Shandong, Hebei, and
Guangxi (the above seven provinces, municipalities, and autonomous region
collectively referred to as "operating regions to be acquired" by Party B, Party
B's "current operating regions" and the "operating regions to be acquired" by
Party B collectively referred to as Party B's "operating regions", and the
operating subsidiaries in such operating regions collectively referred to as
Party B's "operating subsidiaries");
5. Party B has been granted relevant exemptions by HKSE on Party B's related
party transactions in accordance with the listing rules of HKSE; and a general
shareholder meeting will be convened to seek the independent shareholders of
Party B who are deemed to be independent in accordance with the listing rules to
approve relevant transactions.
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6. The six operating subsidiaries in Party B's current operating regions
(namely, Guangdong, Zhejiang, Jiangsu, Fujian, Hainan and Henan) and the seven
operating subsidiaries in the operating regions to be acquired by Party B
(namely, Beijing, Tianjin, Shanghai, Liaoning, Shandong, Hebei and Guangxi)
currently conduct sales of the "Shenzhouxing" Pre-paid Cards and Value-adding
Cards in their respective operating region, and the "Shenzhouxing" Pre-paid Card
subscribers of both Party A and Party B need Party A and Party B to provide
domestic inter-provincial interconnection and roaming services.
THEREFORE, the Parties reach the following agreement through
friendly consultations.
ARTICLE ONE CONDITIONS PRECEDENT TO EFFECTIVENESS
1.1 This Agreement shall not come into effect until the following
conditions have be satisfied (unless Party B agrees to waiver any of
such conditions):
1.1.1 Party B shall have been granted relevant exemptions by
HKSE for Party B's connected transactions in accordance
with the listing rules of HKSE;
1.1.2 The independent shareholders of CMHK who are deemed to be
independent in accordance with the listing rules shall have
approved relevant transactions; and
1.1.3 Party B shall have completed the acquisitions of the seven
operating subsidiaries in the operating regions to be acquired
by Party B.
1.2 If the condition set forth in Article 1.1.3 above is not satisfied,
this Agreement shall be applicable to the six operating subsidiaries in
Party B's current operating regions.
ARTICLE TWO GENERAL PROVISIONS
2.1 Party B's existing six operating subsidiaries, namely Guangdong Mobile,
Zhejiang Mobile, Jiangsu Mobile, Fujian Mobile, Hainan Mobile and Henan
Mobile in its current operating regions, and the seven operating
subsidiaries, namely Beijing Mobile, Tianjin Mobile, Shanghai Mobile,
Liaoning Mobile, Shandong Mobile, Hebei Mobile, and Guangxi Mobile to
be acquired by Party B shall be responsible for the sales of
"Shenzhouxing" Pre-paid Cards and Value-adding Cards in the above 13
provinces, municipalities and autonomous region, and shall comply with
Party A's centralized business management measures.
ARTICLE THREE PRINCIPLES FOR REVENUE SHARING OF INTER-PROVINCIAL SALES OF
ADDED VALUE FOR THE "SHENZHOUXING" VALUE-ADDING CARDS
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A "Shenzhouxing" subscriber, i.e., the holder of the Pre-paid Card, may
purchase a Value-adding Card in another operating region and add value, in which
case the operating subsidiary in such subscriber's home operating region (i.e.,
the operating region where such subscriber's Pre-paid Card is registered) shall
settle accounts with the operating subsidiary in the operating region where such
Value-adding Card is registered. Eighty-five percent of the added value of such
Value-adding Card shall be settled for the account of the operating subsidiary
in the home operating region of such "Shenzhouxing" subscriber, and the
remaining 15% shall be settled for the account of the operating subsidiary in
the operating region where such Value-adding Card is registered.
ARTICLE FOUR SETTLEMENT PRINCIPLES FOR DOMESTIC INTER-PROVINCIAL
ROAMING OF THE "SHENZHOUXING" PRE-PAID SERVICES
Party A and Party B shall conduct roaming settlement in accordance with
the existing "Shenzhouxing" Pre-paid Services usage charge standards, as may be
adjusted from time to time.
4.1 Settlement of base roaming charge in connection with domestic
inter-provincial roaming services:
In respect of roaming into another operating region by the
"Shenzhouxing" subscribers of both Parties, the operating subsidiary in
the home operating region of such subscribers shall pay, through
settlement with Party A, 80% of the base roaming charge (currently
being RMB 0.80 per minute) to the operating subsidiary in the visited
operating region.
4.2 Settlement of long distance charge when roaming:
In respect of roaming into another operating region by the
"Shenzhouxing" subscribers of both Parties, the operating subsidiary in
the home operating region of such subscribers shall pay, through
settlement with Party A, to the operating subsidiary in the visited
operating region all long distance charges incurred when such
subscribers make calls while roaming. The operating subsidiary in the
home operating region of such subscribers may keep all long distance
charges incurred when such subscribers receive calls while roaming.
4.3 Currently, international roaming services are not available to the
"Shenzhouxing" subscribers. If international roaming services are made
available to the "Shenzhouxing" Pre-paid Card in the future, Party A
and Party B will enter into a supplemental agreement providing for the
settlement of the relevant international long distance charges and base
international roaming charges in accordance with the settlement
principles set forth in the Inter-Provincial Network Interconnection,
Domestic and International Roaming and Settlement Agreement, dated May
5, 2000, between Party A and Party B.
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ARTICLE FIVE PRINCIPLES FOR DOMESTIC INTER-PROVINCIAL
ROAMING CLEARING FEE
The Parties hereby acknowledge and agree that, in consideration of the
domestic inter-provincial roaming clearing services provided by Party A to Party
B, Party B shall pay Party A a domestic inter-provincial roaming call record
processing fee of RMB 0.02 for each call record processed. If international
roaming services are made available to the "Shenzhouxing" Pre-paid Card in the
future, Party A shall provide international (including Hong Kong, Macao and
Taiwan) roaming clearing services to Party B, for which Party B shall pay Party
A international roaming clearing fees in accordance with the supplemental
agreement referred to in Article 4.3 above.
ARTICLE SIX SETTLEMENT OF DOMESTIC INTER-PROVINCIAL ROAMING CHARGE OF
"SHENZHOUXING" PRE-PAID CARD; PAYMENT OF CLEARING FEE
6.1 Party A and Party B hereby acknowledge and agree that the Parties shall
settle the domestic inter-provincial long distance roaming charges in
connection with the "Shenzhouxing" pre-paid service on a monthly basis.
The cycle of such settlement shall be from 0:00 on the 21st day of the
proceeding month to 24:00 on the 20th day of the current month. Such
settlement shall be made on the strength of the settlement statement
furnished by Party A, and Party B's billing data shall be used for
reference and verification purpose. If Party B has any different
opinions on such settlement statement furnished by Party A, the
settlement shall be nevertheless made on the basis of Party A's such
settlement statement for the time being. The portion of settlement in
dispute shall be confirmed by the Parties and adjusted accordingly in
the succeeding month.
6.2 Party B's Mainland China operating subsidiaries shall perform Party B's
obligations hereunder to pay Party A the roaming settlement fees and
the roaming clearing fees.
6.3 Party A and Party B hereby acknowledge and agree that the Parties shall
settle the roaming settlement and clearing fees in connection with the
"Shenzhouxing" pre-paid service on a monthly basis. The cycle of such
settlement shall be the same as the settlement of the roaming charges.
The roaming settlement and clearing fees shall be listed as a separate
item in the domestic inter-provincial roaming charge settlement
statement.
6.4 Party A shall furnish the settlement statement of the proceeding month
to Party B's Mainland China operating subsidiaries by the 18th day of
each month. Party B's Mainland China operating subsidiaries shall make
payment accordingly into the bank account designated by Party A by the
25th day of each month. Party A shall disburse roaming settlement fees
to Party B's Mainland China operating subsidiaries by the 28th day of
each month.
6.5 If either Party fails to make settlement payment as provided for above,
it shall pay the other Party a late payment surcharge of 0.3% of the
overdue payment
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per day.
ARTICLE SEVEN LIABILITIES FOR BREACH OF CONTRACT
7.1 Any failure by either Party to fully perform any provisions under this
Agreement on a timely basis shall be deemed as breach of contract. If a
Party's default hereunder results in full or partial unenforceability
of this Agreement and/or related agreements, such Party shall be held
liable for the consequences of such default, unless such default was
caused by an event of "Force Majeure". Any Party or Parties who
breaches this Contract as a result of an event of Force Majeure shall
be liable for the consequences of its/their own such default.
7.2 If either Party fails to deliver any roaming charge statement to the
other Party as scheduled, the allocation ratio in respect of the
roaming charge on such roaming charge statement shall be adjusted in
accordance with the applicable business regulations.
ARTICLE EIGHT FORCE MAJEURE
8.1 If a Party/both Parties is/are unable to perform all or any of
its/their obligations hereunder as the result of an event of Force
Majeure, performance of such obligation(s) shall, during the period of
such event of Force Majeure event, be suspended, and the period for
performance of such obligations shall be extended automatically, in
which case the affected Party/Parties will not be held liable for
breach of contract.
8.2 The Party affected by an event of Force Majeure shall promptly notify
in writing the other Party of the occurrence of such Force Majeure
event and shall, within fifteen days of occurrence of such Force
Majeure event, furnish the other Party with an effective legal document
evidencing the occurrence and timing of such Force Majeure event. The
affected Party shall take all reasonable measures to litigate the
effects of such event as soon as possible.
8.3 The Parties shall, immediately upon occurrence of an event of Force
Majeure, hold negotiations for a fair resolution thereof and shall make
best efforts to litigate the effects of such Force Majeure event.
ARTICLE NINE GOVERNING LAW
The execution, validity, interpretation, performance of and dispute
resolution in connection with this Agreement shall be governed by the laws of
the People's Republic of China.
ARTICLE TEN RESOLUTION OF DISPUTE
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10.1 Any and all disputes arising out of or in connection with the
performance hereof shall be settled through friendly negotiations
between the Parties and through mediations. If no resolution can be
reached through negotiations and mediations within ninety days of
occurrence of any dispute, such dispute shall be submitted for
arbitration.
10.2 Any dispute submitted for arbitration shall be submitted to the China
International Economic and Trade Arbitration Commission. Such
arbitration shall be conducted in accordance with the arbitration rules
of the Commission in Beijing. The award of such arbitration shall be
final and binding on both Parties. The cost of arbitration shall be
borne by the losing Party.
10.3 Except the matter in dispute and under arbitration, the Parties shall,
during the process of arbitration, continue to perform their
obligations hereunder and under other related agreements or contracts
between the Parties.
ARTICLE ELEVEN MISCELLANEOUS
11.1 Non-waiver
Any failure of or delay in exercising any right or power hereunder by a
Party shall not, in accordance with laws of the PRC, be construed as
waiver of such right or power, and any single or partial exercise of
any right or power hereunder by a Party shall not in any way affect
future or full exercise of such right or power by such Party.
11.2 Non-transferable
Neither Party may, without prior written consent of the other Party,
transfer all or any part of its rights and obligations hereunder. Any
transfer by either Party of its rights and obligations hereunder shall
be conducted in accordance with this Agreement.
11.3 Binding Effect
This Agreement is for the benefit of the Parties and their legal
successors and assignees. No amendment to this Agreement shall become
effective unless made in writing and signed by the Parties.
11.4 Severability
If any provision herein becomes illegal, invalid or unenforceable at
any time but do not have fundamental effect on the validity of this
Agreement, such provisions shall not invalidate the remaining
provisions of this Agreement.
11.5 Effectiveness and Term
The term of this agreement shall be one year, starting from July 1,
2000 and expiring on June 30, 2001; provided that the provisions in
connection with the
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settlement of the revenues sharing of sales of added value for
"Shenzhouxing" Value-adding Card shall come into effect on February 1,
2000 and expire on June 30, 2001. This agreement shall be automatically
extended for one year unless either party terminates this Agreement by
a written notice to the other Party to that effect three months prior
to the expiration of this Agreement, and the times of such extension
shall not be limited. Neither Part may not unilaterally terminate this
Agreement during the term of this Agreement without the other Party's
prior written consent thereto.
11.6 Entire Agreement
This agreement constitutes the entire agreement between the Parties
with respect to the subject matter of this Agreement, and supersedes
any and all discussions, negotiations and agreements between them
regarding the same prior to the execution of this Agreement.
11.7 Notices
(1) Any notices or other communications required to be given under
this Agreement shall be delivered by mail (registered mail
(postage pre-paid) or internationally recognized courier
services) or by facsimile or telex, confirmation by express
mail requested, to the above listed addresses of the Parties
or to other addresses as a Party may notify the other Party
from time to time in the same manner.
(2) Any notices or communications required to be given under this
Agreement shall be deemed to have been delivered five days
after the date of post (as evidenced by the date of the
postmark) by registered mail (postage pre-paid), or three days
after the date of delivery by an internationally recognized
courier services provider, or three days after the date of
delivery by facsimile or telex (to be confirmed by express
mail).
11.8 Counterparts
This Agreement is signed in four counterparts. Party A and Party B will
keep two copies each. All the executed copies of this Agreement have
the same legal force and effect.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be signed
by their duly representatives in Beijing on the date first above written.
CHINA MOBILE COMMUNICATIONS CORPORATION CHINA MOBILE (HONG KONG) LIMITED
By: s/Lu Xiangdong By: s/Wang Xiaochu
Authorized Representative Authorized Representative
Title: Title:
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