Exhibit 10.1
ENGLISH TRANSLATION OF CHINESE LANGUAGE ORIGINAL
Restructuring Agreement
between
China Life Insurance (Group) Company
and
China Life Insurance Company Limited
TABLE OF CONTENTS
1. Definitions...............................................................4
2. Effectiveness of the Restructuring........................................6
3. Representations and Warranties............................................8
4. Implementation of the Restructuring.......................................9
5. Taxation.................................................................13
6. Indemnities..............................................................14
7. Non-Competition..........................................................16
8. Applicable Laws and Resolution of Disputes...............................17
9. Supplemental Provisions..................................................17
APPENDIX
I Further Representation and Warranties Given by Party A......................21
II Financial Report...........................................................36
III Injected Assets...........................................................37
IV Legal Proceedings..........................................................39
V Restructuring Documents.....................................................41
VI Valuation Report...........................................................42
VII Electronic Document.......................................................43
VIII Reinsurance Contracts....................................................44
IX List of Assets and Liabilities Transferred to Party B......................45
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This agreement (the "Agreement") is entered into on September 30, 2003 in
Beijing, People's Republic of China (the PRC) by and between the following two
parties:
Party A: China Life Insurance (Group) Company (Legal Person Enterprise Business
License No.: 1000001002372), a wholly state-owned company established and
existing under the laws of the PRC, whose address is at ▇▇. ▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇
▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇.
Party B: China Life Insurance Company Limited (Legal Person Enterprise Business
License No.: 1000001003796), a joint stock limited company established and
existing under the laws of the PRC, whose address is at China Life Building,
▇▇.▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, PRC.
Whereas:
1. Party A has obtained State Council's approval to promote and establish
Party B. Party B plans to make a public offering abroad, including the
offering to overseas investors of overseas-listed foreign-invested shares
(hereinafter referred to as H Shares) to be listed on the Stock Exchange of
Hong Kong Limited (hereinafter referred to as HKSE), and American
Depository Shares (hereinafter referred to as ADS) to be listed on the New
York Stock Exchange (hereinafter collectively referred to as Overseas
Offering). Party A plans to conduct a restructuring pursuant to this
Agreement.
2. Party A has transferred to Party B, after appropriate valuation, the
insurance business related to the New Policies as set forth in Clause 1.1
of this Agreement, and its related assets, liabilities, equity, and
operating assets required for principle business, and has established Party
B on June 30, 2003 as the sole promoter of Party B.
3. As at the date hereof, Party A owns 100% of the shareholding in Party B.
Upon the completion of the Overseas Offering, Party A shall become the
controlling shareholder of Party B.
4. In order to ensure the implementation of the contents and purposes of the
restructuring, Party A and Party B have agreed to make appropriate
arrangements for the restructuring and matters relating to the
restructuring in accordance with the terms and conditions set forth herein.
IT IS HEREBY AGREED AS FOLLOWS:
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1. Definitions
1.1. Unless the context otherwise requires, the following expressions have
the following meanings in this Agreement/1/:
Appraiser means China Financial and Accounting Consulting Co. Ltd.
China means People's Republic of China (for the purpose of this
Agreement, not including the Hong Kong Special Administrative Area,
Maucau Special Administrative Area and Taiwan Province).
Controlling Shareholder means, in the context of this Agreement, the
person who satisfies any of the following conditions: (1) a person
who, acting alone or in concert with others, has the power to elect a
majority of the board of directors in a company; (2) a person who,
acting alone or in concert with others, has the power to control the
exercise of 30% or more of the voting rights in a company; (3) a
person who, acting alone or in concert with others, holds 30% or more
of the issued shares of a company; or (4) a person who, acting alone
or in concert with others, has de facto control of a company in any
other way.
Effective Date of the Restructuring means the Establishment Date of
Party B.
Establishment Date of Party B means June 30, 2003 (the date on which
Party B was registered with the State Administrative Bureau for
Industry and Commerce of the PRC, and obtained the Legal Person
Enterprise Business License).
Financial Reports means (i) the pro forma financial reports of the
year of 2000, 2001 and the period from January 1, 2003 to June 30,
2003; and (ii) pro forma profit reports of the year of 2000, 2001 and
2002 of Party B, in each case which are prepared by Party A in
accordance with the Enterprises' Accountant System of the PRC, and are
audited by Pricewaterhouse-Coopers Accountants Firm Co. Ltd. (as
attached to this Agreement as Appendix II).
Injected Assets means the injected assets set out in Appendix III
hereto.
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/1/ Translator's Note: The order of the terms defined hereunder have been
re-arranged to English alphabetical order for the convenience of English
readers.
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New Policies mean the long-term and short-term insurance policies as
well as riders supplemental to policies that Party A entered into
according to the following definitions:
A. long-term insurance policies: policies issued by Party A on or
after June 10, 1999, having policy terms approved by or filed
with the CIRC on or after June 10, 1999 and having a term of more
than one year (not including one year) from the date of issuance,
and
a. policies that are recorded as a long-term insurance policy
as of June 30, 2003 in the actuarial database contained in
Appendix VII hereto, or
b. policies having terms of group supplemental medical plans
(fund type).
B. short-term insurance policies: main policies issued on or after
June 10, 1999, having a term of one year or less from the date of
issuance.
C. riders supplemental to policies: all riders supplemental to the
policies described in A and B above.
Non-transferred Policies mean all the policies that are directly, or
through reinsurance, underwritten by Party A (whether primary policies
or riders supplemental to the policies) which are still being
performed, or otherwise can be reinstated, excluding Transferred
Policies.
Party A means China Life Insurance (Group) Company and its
subsidiaries (other than Party B), branches and other branch offices.
Party A shall include the assets and business of Party A, unless the
context otherwise requires.
Party B means China Life Insurance Company Limited and its
subsidiaries, branches and other branch offices. Party B shall include
the assets and business of Party B, unless the context otherwise
requires.
Prospectus means any prospectus to be published by Party B in
connection with the initial public offering of H shares and ADS.
Relevant Period means the period between the Valuation Date and the
Establishment Date of Party B (both dates included).
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Restructuring means the restructuring as referred to in the hereof,
described Recital in the Restructuring Plan and implemented in
accordance with the terms and conditions set out herein.
Restructuring Documents mean the Restructuring Plan and the
restructuring approval documents set out in Appendix V hereto.
Restructuring Plan means the restructuring plan set out in Appendix V.
RMB means the lawful currency of China denominated in yuan.
Transferred Contracts mean the contracts defined by Clause 2 of
Appendix III hereto.
Transferred Policies mean the New Policies and the reinsurance
policies set out in Appendix VIII hereof.
Valuation Date means June 30, 2002.
Valuation Report means the Asset Valuation Report of the Joint Stock
Company promoted and established by China Life Insurance Company
prepared by the Appraiser in connection with the establishment of
Party B and approved by the Ministry of Finance of the PRC on June 24,
2003, with June 30, 2002 being the Valuation Date. The Valuation
Report is enclosed as Appendix VI hereto.
1.2. In this Agreement, unless otherwise provided:
1.2.1. Clauses or Appendices are the clauses and appendices of this
Agreement; and
1.2.2. This Agreement shall be construed as the agreement may be
extended, amended, altered or supplemented from time to time.
2. Effectiveness of the Restructuring
2.1. Party A confirms that the Restructuring has been approved by relevant
authorities Chinese as of the Establishment Date of Party B. All
relevant approval documents are set out in Appendix V hereto. Both
Parties agree that the Restructuring shall officially come into effect
upon the Effective Date of the Restructuring.
2.2. Both Parties agree to implement the Restructuring in accordance with
the relevant provisions of the Restructuring Plan and this Agreement.
2.3. Party A and Party B agree that upon the Effective Date of the
Restructuring (including the date itself), Party B shall enjoy the
ownership of the assets, credits, rights and interests under the
Injected
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Assets (including the Transferred Policies), and assume the
liabilities, responsibilities and obligations under the Injected
Assets (including the Transferred Policies) disclosed by the Financial
Reports, unless otherwise provided for herein. Party B shall assume no
obligations and responsibilities, and enjoy no rights relating to
other assets (including the Non-transferred Policies), rights,
interests, liabilities, responsibilities and obligations (including
potential liabilities and obligations) and related businesses retained
by Party A pursuant to the Restructuring Plan, the Financial Reports
and this Agreement. Party A shall continue to enjoy the relevant
rights and assume the relevant responsibilities and obligations
relating to its retained rights, interests, liabilities,
responsibilities and obligations (including potential liabilities,
responsibilities and obligations) under the assets retained by it
(including Non-transferred Policies) and related businesses, unless
otherwise provided by Clause 6.1.8 hereof.
2.4. According to the Tentative Regulations on State-Owned Capital
Administration and Financial Management in the Course of Enterprises'
Restructuring issued by the Ministry of Finance, an increase in the
net assets resulting from the profits generated from the Injected
Assets during the period between the Valuation Date and the
Establishment Date of Party B shall be owned by Party A, or with the
approval of Party A, shall become the exclusive state-owned capital
common reserve of Party B, to be converted into state-owned shares
held by Party A upon any future annual increase of shares. Party A
shall compensate Party B for a decrease in the net assets due to
losses incurred during the period between the Valuation Date and the
Establishment Date of Party B. In accordance with the Restructuring
Plan, Party A shall enjoy (or bear) the increase (or decrease) in net
assets resulting from profits (or losses) of the Injected Assets
during the period between the Valuation Date and the Establishment
Date of Party B.
2.5. Party A confirms that the Injected Assets have been valuated by the
Appraiser (which valuation is recorded in the Valuation Report), and
approved by the relevant Chinese governing authorities; the net
Injected Assets, pursuant to statutory conversion ratio, have been
converted into 20 billion shares, each of which has a par value of RMB
1 yuan; and the aforesaid shares have been issued to Party A upon the
Establishment Date of Party B, and approved by the relevant authority
to be used as registered capital of Party B. Thus, Party B has paid up
to Party A the consideration of the Injected Assets. As a result,
Party A has no claim to any other consideration in relation to the
Injected Assets from Party B.
2.6. Party A confirms that in accordance with the Restructuring Plan and Pu
Hua ▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇ [2003] No.93 Capital Verification Report
7
produced by PricewaterhouseCoopers Accounting Firm Co. Ltd on June 27,
2003, the net assets under the Injected Assets injected to Party B by
Party A on the Establishment Date of Party B amounts to RMB 29.608
billion.
2.7. Injected Assets have been transferred and delivered in status quo to
Party B on the Establishment Date of Party B legally and effectively,
unless otherwise provided by Clause 4 hereof, Implementation of the
Restructuring.
3. Representations and Warranties
3.1. Party A presents to Party B such representations and warranties as
provided in Appendix I and this Clause that as of the Effective Date
of the Restructuring and the date of this Agreement:
3.1.1. Party A has injected the Injected Assets into Party B in
accordance with the laws of the PRC, unless otherwise provided in
Clause 4 hereof, Implementation of the Restructuring hereof;
3.1.2. Any material approval, permission, authorization, consent,
confirmation, exemption, registration, filing or record from a
third party, which is required to be obtained or completed for
the injection of the Injected Assets into Party B by Party A have
been obtained or completed, and are effective as at the
Establishment Date of Party B, unless otherwise provided for
herein;
3.1.3. On the Effective Date of the Restructuring and the date of this
Agreement, Party B has no material liabilities or contingent
liabilities other than those disclosed by the Financial Reports
under the item of the Injected Assets and those (including
contingent liabilities) arising from the normal operation of the
Injected Assets during the Relevant Period;
3.1.4. Party A has committed no action that is in material breach of
laws or regulations and which may possibly lead to any material
financial loss of Party B;
3.1.5. Party A has committed no action that infringes upon a third
party's patent right, copy right, know-how, design, domain name,
trademark, goodwill or any other intellectual properties
protected by laws, and which may possibly lead to any material
financial loss of Party B.
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3.1.6. Unless otherwise set forth in Appendix IV hereof, there is no
ongoing, pending or threatened material and/or important lawsuit,
arbitration, claim or any other legal proceeding against Party A
(as plaintiff, defendant or in any other capacity), or in
connection with the business of Party B or the Injected Assets,
and which may have a material adverse effect on Party B's
business operations and/or the Injected Assets; nor any claim
which may have a material adverse effect on Party B's business
operation and/or the Injected Assets, or any fact which may lead
to any such claim;
3.1.7. The representations and warranties made by Party A in this
Clause and the further representations and warranties made by
Party A in Appendix I hereof are true, accurate and complete and
contain no misleading elements, unless otherwise disclosed in
writing by Party A to Party B prior to the execution of this
Agreement.
3.1.8. The disclosures in writing by Party A to Party B in respect of
the Injected Assets are true, accurate and complete, and there is
no other circumstances that may possibly lead to a material
adverse effect on the Injected Assets.
3.2. Party A agrees, pursuant to Clause 6 hereof, to compensate Party B
against the losses, expenses and expenditures (including but not
limited to legal fees) suffered by Party B as a result of breach by
Party A of the representations and warranties contained herein.
3.3. The representations and warranties contained herein shall survive
after the completion of the Restructuring.
4. Implementation of the Restructuring
4.1. Both parties agree to use their best efforts to take any necessary
steps (including but not limited to the signing of, or procuring the
signing by other persons of, any related documents; applying for and
acquiring any related approval, consent, license, authorization,
confirmation or exemption in order to help Party B obtain all the
licenses and certificates necessary for the operations of Party B or
Injected Assets; and handling all procedures related to registrations
or filings in accordance with relevant proceedings) in order to ensure
that the Restructuring shall be fully implemented in accordance with
this Agreement, the Restructuring Documents and the Financial Reports.
Both Parties shall, on the basis of equality, fairness and
reasonableness, through friendly negotiation, properly settle the
matters necessary for the implementation of the Restructuring but not
9
prescribed in this Agreement, the Restructuring Documents and the
Financial Reports.
4.2. During the Relevant Period, (i) Party A shall, in its ordinary course
of operations, operate, manage, employ and maintain the Injected
Assets and the newly generated insurance business assets during such
period in accordance with its usual practice; (ii) starting from the
Effective Date of the Restructuring, Party B shall enjoy the ownership
of the assets, credits, rights and interests under the assets of such
newly generated insurance business; (iii) if the Injected Assets are
reduced as a result of Party A's operations, Party A shall supplement
them in full.
4.3. Without prejudice to Clauses 3.1.5, 3.1.6, 3.1.7 and 3.1.8, Party B
shall participate as a party in any lawsuit or arbitration relating to
the Injected Assets that arise after the Effective Date of the
Restructuring, and enjoy the relevant rights and assume the relevant
obligations thereunder. Upon Party B's request, Party A shall render
prompt assistance to Party B, including but not limited to furnishing
all the documents Party B requires, and signing or procuring others to
sign related documents so that Party B may effectively become the
party to such lawsuit or arbitration and exercise the rights such a
party shall have.
4.4. Party A shall continue to bear all liabilities and obligations unless
otherwise provided for as Party B's liabilities and obligations under
or pursuant to this Agreement. Party A undertakes herein that Party B
shall not sustain any loss or assume any liability as a result of
aforesaid liabilities and obligations borne by Party A. Party A shall
bear, promptly and sufficiently, the legal expenses; including
retainers, judiciary fee, travel expenses and other related expenses
should Party B be involved in any lawsuits, arbitrations or legal
proceedings as a result of such liabilities and obligations. Party A
undertakes to provide Party B with guaranties or any other security
Party B needs to secure Party B's rights against any impairment, if
the assets of Party B are withheld, subject to lien or imperiled by
the aforementioned liabilities and obligations; furthermore, Party A
undertakes to bear all the losses and related expenses arising from
any aforementioned charge or lien, whether reasonable or not. Party A
undertakes to pay up all such expenses within 7 days of the receipt of
Party B's ▇▇▇▇ of losses and expenses.
4.5. Where any third party's authorization, approval, consent, permission,
confirmation or exemption is required for the transfer of any assets,
interests or liabilities under the Injected Assets to Party B, and the
aforesaid procedures are not completed as at the Establishment Date of
Party B, Party A shall, as required by Party B, continue to hold and
manage the aforesaid assets, interests and liabilities in the interest
of
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Party B until the aforesaid assets, interests and liabilities can be
injected legally, effectively and fully into Party B pursuant to the
provisions of this Agreement, except for the requirements of Clause
4.1 above.
4.6. Both parties agree that Party B shall be the insurer with respect to
all policies issued by Party A during the period from June 30, 2003 to
the date when Party B commenced issuing policies in its own name. Any
rights, interests, profits, obligations, losses or claims of an
insurer thereunder shall be enjoyed or assumed by Party B.
4.7. During the period provided by Clause 4.5 where Party A continues to
hold and manage the assets, interests, and liabilities under the
Injected Assets as required by and in the interest of Party B, any
rights, interests, profits and all obligations, losses and claims
arising from or in connection with aforementioned assets, equity, and
liabilities shall be enjoyed or borne by Party B (not including any
obligations, damages and claims as a result of Party A's failure to
perform its obligations under Clause 4.5).
4.8. In the process of the implementation of the Restructuring, if there is
any ambiguity in the separation of assets and liabilities, the
specifics in respect of the separation of assets and liabilities
provided in the Restructuring Plan and the Financial Reports shall be
conclusive or, if necessary, reference may be made to the calculation
formula for adjusting the assets and liabilities as well as other
relevant documentation applied when preparing the Restructuring Plan
and the Financial Reports.
4.9. Party A and Party B undertake to each other that if one party receives
the other party's accounts receivable after the Restructuring becomes
effective, such accounts receivable shall be reimbursed by the
receiving party to the other party within 7 days of receipt and
confirmation of the accounts receivable.
4.10. Party A shall deliver to Party B all materials that are related to
the business arising from Transferred Polices and other Transferred
Contracts, including original documents, copies, computer discs,
business records, financial and accounting records, business data,
statistics, training manuals and all relevant technology records,
technology information, technology data, technology blueprints,
technology handbooks, technology books, research and development
project materials, as well as all software that are related to the
business of Party B (whether they are recorded in a written form or
saved in a computer or in any other way).
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4.11. For the purpose of cross-checking accounts, both parties agree that
they shall make three computer disks in respect of the data compiled
as of June 30, 2003 from the database contained in Appendix VII
hereof, with one for each party and the 3rd one kept with the
company's PRC legal counsel for inspection.
4.12. Pursuant to the Policy Management Agreement and the Asset Management
Agreement separately entered into by both parties, Party B shall
provide Party A with the services under the said agreements.
4.13. Pursuant to the Property Leasing Agreement separately entered into by
both parties, Party A shall lease to Party B the properties under the
said agreement.
4.14. Pursuant to Trademark License Agreement separately entered into by
both parties, Party A shall grant Party B the right to use the
trademarks under the said agreement.
4.15. The interest, moratoria interest and other expenses arising from the
liabilities prior to the Effective Date of the Restructuring arising
under the Injected Assets shall be borne by Party A. Party A shall
fully indemnify Party B against any losses sustained by Party B as a
result of the aforementioned interest, moratoria interest and other
expenses.
4.16. Unless otherwise provided by applicable laws, Party B shall have no
obligations to any employee who was employed by Party A prior to the
Establishment Date of Party B for the payment of salary, welfare,
allowances and any other rights and interests, including but not
limited to one time housing allowance and extra allowances other than
social pension plan after retirement, accrued during the employment
with Party A and pursuant to any law, contract, judgment, decision or
any binding document. If any aforesaid employee files a claim in
respect of the rights and interests mentioned above against Part B,
Part A shall fully indemnify Party B against the losses sustained by
Party B as a result of such claim.
4.17. Unless otherwise provided by applicable laws, Party B shall have no
obligation whatsoever to any person who had been employed by Party A
on or prior to the Establishment Date of Party B but is not employed
by Party B, including but not limited to those who were employed by
Party A on or prior to the Establishment Date of Party B but have been
laid off or have retired, both officially and unofficially, prior to
the date of this Agreement. If any aforementioned employee files a
claim based on his or her employment by Party A against Part B, Part A
shall fully indemnify Party B against the losses sustained by Party B
as a result of such claim to the effect as if such claim had never
been filed.
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5. Taxation
5.1. For the purpose of this Clause 5, the term tax means all the taxes or
their related payments levied by the State, local tax authorities or
the State or local governments, including but not limited to income
tax, value-added tax, business tax, consumption tax, deed tax, tariff,
stamp duty, and:
5.1.1. Taxes to be levied on, or payments to be collected, as a result
of subcontracting or similar arrangements with relevant
authorities;
5.1.2. Any tax to be further levied, irrespective of whether
additional taxes or further levies arise from the fact that the
tax already levied or paid was inadequate, or the deduction or
exemption granted or enjoyed relating the tax levied or paid is
inappropriate or is illegally obtained;
5.1.3. Any fine, overdue fine or other amount payable in respect of
any tax.
5.2. Without prejudice to Clause 6.2 of this Agreement, Party A shall bear:
5.2.1. All taxes arising from or in connection with the Injected
Assets before the Effective Date of the Restructuring,
irrespective of whether such taxes are collected or paid before
or on or after the Effective Date of the Restructuring, to the
extent not already accounted for or specified in the Financial
Reports;
5.2.2. All taxes arising from or in connection with the assets,
interests and liabilities and their related businesses retained
by Party A pursuant to the provisions of the Restructuring
Documents, Financial Reports and this Agreement.
5.3. Party A agrees that Party B shall not bear the enterprise income tax
arising from the added value resulting from the valuation of the
Injected Assets, and that enterprise income tax arising from added
value resulting from the valuation of the Injected Assets and all
other taxes shall be borne by Party A.
5.4. Pursuant to Clause 5.2 and 5.3 hereof, Party B shall bear all taxes
arising from or in connection with the ownership, management or
operation of the Injected Assets on or after the Effective Date of the
Restructuring.
5.5. Unless otherwise provided herein, all taxes arising from or in
connection with the injection of the Injected Assets into Party B by
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Party A in accordance with the Restructuring Documents, the Financial
Reports and this Agreement shall be respectively borne by Party A and
Party B in accordance with applicable laws.
6. Indemnities
6.1. Party A hereby undertakes to indemnify Party B completely,
sufficiently, timely, effectively and in full from and against any
losses incurred as a result of:
6.1.1. Any claim, lawsuit, arbitration, loss, compensation, payment,
cost, expense and expenditure (including but not limited to
professional service fees and expenses) (collectively referred to
as the Claims; and the Claims in the following clauses shall have
the same meaning) in connection with the taxes specified in
Clause 5.2 hereof;
6.1.2. Taxes not borne by Party B in Clause 5.3 hereof and any Claims
in connection with such taxes;
6.1.3. Taxes not borne by Party A in Clause 5.5 and any Claims in
connection with such taxes;
6.1.4. Any challenge, interference or Claim by any third party with
respect to the lease of Party A's properties by Party B under the
Property Leasing Agreement;
6.1.5. Any Claims arising from the Injected Assets against Party B
prior to the Effective Date of the Restructuring, save as those
for which reserves have been made in the Financial Reports;
6.1.6. On or after the Effective Date of the Restructuring, any Claims
made against Party B arising from or in connection with any
negligence or misconduct by Party A in connection with Party A's
performance of any contract in accordance with Clause 4.5 hereof;
6.1.7. On or after the Effective Date of the Restructuring, any Claims
or losses incurred by Party B in its capacity as the insurer of
insurance policies in accordance with Clause 4.6 hereof.
6.1.8. On or after the Effective Date of the Restructuring, any
payment of Claims and related expenses by Party B, at the request
of any policy holder, in performing any obligation under an
insurance policy that is not recorded in the actuarial database
contained in Appendix VII hereof, but is otherwise proved by
sufficient evidence to be a policy Party A entered
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into on or after June 10, 1999, having a term of more than one
year (not including one year) and having its terms approved by or
filed with the CIRC on or after June 10, 1999;
6.1.9. On or after the Effective Date of the Restructuring, any losses
and Claims Party B suffered as a result of disputes in connection
with Party A's being the insurer of policies pursuant to Clause
6.1.8;
6.1.10. Any Claims arising from or in connection with the contingent
liabilities that are disclosed by the Financial Reports but for
which the reserve are not provided for or the provision of the
reserve is not sufficient, and which have subsequently have
become the liabilities of Party B for any reason on or after the
Effective Date of the Restructuring;
6.1.11. Prior to, on or after the Effective Date of the Restructuring,
(i) Any Claims against Party B arising from or in
connection with any breach by Party A of the provisions
of the Financial Reports, the Restructuring Documents
and this Agreement to inject the Injected Assets into
Party B;
(ii) Any Claims against Party B arising from or in
connection with the assets, interests and liabilities
retained by Party A pursuant to the provisions of the
Financial Reports, the Restructuring Documents and this
Agreement;
(iii) Any Claims against Party B arising from or in
connection with the injection of the Injected Assets
into Party B by Party A; and
(iv) Any Claims against Party B arising from any breach by
Party A of any provisions hereof (including but not
limited to Clause 3 hereof and Party A's further
representations and warranties in Appendix I).
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6.2. Party A undertakes to indemnify Party B in full against any Claims
incurred by Party B arising in other capacity in any ongoing, pending
or threatened arbitration or lawsuit, including but not limited to
those disclosed in this Agreement, that involves Party A, as
plaintiff, defendant or in any other capacity, with respect to the
Injected Assets.
6.3. Party B undertakes to indemnify Party A against any Claims arising
from any breach by Party B of any provisions hereof.
6.4. The indemnities mentioned in Clause 6.1, 6.2, 6.3 include, but not
limited to, all payments, costs or expenses arising from or in
connection with the settlement of any Claims or the enforcement of the
judgments, rulings or arbitration awards on such Claims.
6.5. Party A or Party B shall be entitled to take appropriate steps to
fully control the claim procedures with respect to any Claim by third
party. Party A or Party B shall make any Claims in writing to the
other Party pursuant to the provisions hereof, and shall summit a
specific description about the facts and circumstances relating to
such Claims.
7. Non-Competition
Party A undertakes to deal with all matters relating to horizontal
competition in accordance with the terms of the Non-competition Agreement
entered into separately by both parties.
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8. Applicable Laws and Resolution of Disputes
8.1. The effectiveness, interpretation and performance of this Agreement
shall be governed by the laws of the PRC.
8.2. Any disputes arising from or in connection with the performance and
interpretation of this Agreement shall be first resolved through
friendly negotiation between both parties.
8.3. In the case no resolution can be reached by both parties within 30
days after the commencement of negotiation, such dispute shall be
submitted to China International Economic and Trade Arbitration
Commission (CIETAC) for arbitration in accordance with the then
effective arbitration rules. The arbitral award shall be final and
conclusively binding upon both parties.
9. Supplemental Provisions
9.1. Any amendment of this Agreement and its appendices shall only be made
in the form of a written agreement, signed by both parties and
approved by appropriate legal person actions taken by both parties.
9.2. This Agreement and the appendices thereof shall be deemed to represent
the entire agreement concerning the transactions mentioned herein, and
shall supercede any verbal or written agreements, contracts,
understandings or correspondence concluded previously concerning such
transactions. The titles of clauses herein are set out only for the
convenience of reading, and are of no legal effect.
9.3. The illegality, invalidity or unenforceability of any one clause shall
not affect the validity and enforceability of the other clauses of
this Agreement.
9.4. Unless otherwise provided, either Party's failure to exercise or
postponement of the exercise of its rights, authorities or privileges
under this Agreement shall not be regarded as the waiver of such
rights, authorities and privileges; and any single or partial exercise
of such rights, authorities and privileges shall not exclude the
exercise of any other rights, authorities and privileges.
9.5. Public Announcement
Unless otherwise provided by applicable laws or the requirements of
HKSE, U.S. Securities and Exchange Commission, New York Stock Exchange
or other regulatory authorities, a Party shall not release or permit
any person to release any announcement related to the subject matter
of this Agreement or any incidental matters in connection with
17
this Agreement without prior written consent of the other Party (such
consent not to be unreasonably denied or withheld).
9.6. Non-Assignment
A Party shall not assign all or part of the rights, interests,
liabilities or obligations under this Agreement in any way without
prior written consent of the other Party.
9.7. Notices
Any notice or correspondence provided by or relating to this Agreement
shall be made in a written form, delivered in person or by ways of
facsimile or registered letter. Unless otherwise specified to the
other Party by additional notice, such notices shall be delivered to
the following addresses. Any notice or correspondence under this
Agreement, if mailed by way of registered letter, shall be deemed to
be delivered on the 7th business day following the date of postmark;
if delivered by way of facsimile, shall be deemed to be delivered on
the 1st business day from the date of the successful dispatch; if
delivered in person, shall be deemed to be delivered on the date of
submission.
Party A: China Life Insurance (Group) Company
Address: ▇▇. ▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Fax: ▇▇▇ ▇▇▇▇ ▇▇▇▇
Tel: ▇▇▇ ▇▇▇▇ ▇▇▇▇
Party B: China Life Insurance Company Limited
Address: China Life Building, ▇▇.▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Fax: ▇▇▇-▇▇▇▇ ▇▇▇▇
Tel: ▇▇▇-▇▇▇▇ ▇▇▇▇
Each Party shall promptly inform the other Party in written notice in
accordance with this Clause of any changes in the contact details.
18
9.8. This Agreement shall be executed in Chinese.
9.9. This Agreement shall be executed in 4 originals, and each Party shall
hold two originals respectively, each of which shall have the same
legal effect.
9.10. The appendices of this Agreement shall constitute an integral part
hereof, and are equally binding as if they have been incorporated
herein.
9.11. Unless otherwise provided for herein, Party A and Party B shall be
responsible for their respective costs and expenses incurred during
the negotiation, preparation and implementation of this Agreement.
9.12. This Agreement shall come into effect upon the signing and sealing by
the authorized representatives of both parties, and the effective date
shall apply retroactively the date of the issuance of Party B's
enterprise legal person business license.
Both Parties have procured their respective authorized representatives to sign
on this Agreement on the date set forth at the beginning of this Agreement.
19
Party A: Party B:
China Life Insurance (Group) Company China Life Insurance Company Limited
(Seal) (Seal)
Legal Representative/ Legal Representative/
Authorized Representative (Signature) Authorized Representative (Signature)
Appendix I
Further Representations and Warranties Given by Party A
Being the sole promoter of Party B, in respect of the validity of Party B's
establishment, Party B's organizational structure and all respects of the
Injected Assets as at the Effective Date of the Restructuring, as at the
Establishment Date of Party B and as at the execution date of this Agreement,
Party A hereby further presents to Party B representations, warranties and
undertakings as follows:
21
1. Legal Capacity and Authority of Both Party A and Party B
1.1. Both Party A and Party B are companies with the status and capacity of
independent legal persons validity incorporated and in existence
pursuant to the laws of China.
1.2. Pursuant to the laws and regulations of China, the articles of
association of both Party A and Party B and/or other organizational
documents, Party A and Party B are entitled to execute, and have
legally and effectively executed, this Agreement, other agreements and
contracts to which Party A and Party B are the parties in connection
with the Restructuring. Both Parties shall be entitled to enjoy and
perform all rights and obligations specified in such agreements and
contracts.
1.3. In accordance with the laws of China, Party B shall have the right to
operate the Injected Assets following the Effective Date of the
Restructuring.
2. Share Capital
2.1. Party A guarantees that no one but Party A owns the share options and
preemptive rights arising from or in connection with the share capital
of Party B as at the Establishment Date of Party B; and that no
mortgage, lien, guarantee or other third party's claims related to the
share capital of Party B (collectively hereafter referred to as third
party's claims) have been created; and that no agreement has been made
or created for all the aforementioned items; and no agreements or
other arrangements that require or may require Party B to issue
additional equity interests beyond those issued currently exist; and
that no persons having entitlement, or claiming to have entitlement,
to the same have made any claims or demands thereof.
2.2. Until the Effective Date of the Restructuring (including the date
itself), there shall not exist any valid agreements involved in the
issuance, allotment, or assignment related to the share or equity
interests or loan capital of Party B at present or in future, nor any
rights granted to anyone in respect of the demand to issue, allot, or
assign any share or equity interests or loan capital of Party B
(including any share option or preemptive right or assignment and
transfer), whether conditional or unconditional.
3. Accounts and Business
3.1. Accounts
The Financial Report of Party B:
22
3.1.1. complies with the PRC Accounting System for Enterprises, on the
assumption that Party B has been existing since January 1, 2000
and the Restructuring has been completed;
3.1.2. sets out, in accordance with the PRC Accounting System for
Enterprises, the equity interests, assets and liabilities for
each of the relevant dates, and profits during relevant financial
periods, as required by such Accounting System, giving a
complete, true, fair and accurate view as to its business
conditions in all material respects;
3.1.3. illustrates (as the case may be) the full provisions or
reserves for all the outstanding liabilities, capital commitments
and well contingent liabilities of Party B at the date set out in
the Financial Report;
3.1.4. makes (as the case may be) provisions or reserves for all taxes
levied on or payable by Party B for the period ended on the date
set out in the Financial Report in accordance with all the
principles set forth in the notes of the Financial Report;
3.1.5. gives a fair and accurate view to the capital, assets,
liabilities of Party B as at the Valuation Date and profits of
Party B for the relevant financial period ended on such date in
all material respects;
3.1.6. is not affected by any irregular or unusual items;
3.1.7. gives a fair view as to the financial position of Party B at
the Valuation Date in all material respects;
3.1.8. makes disclosure of all assets and liabilities of Party B as at
the date specified in the Financial Report.
3.2. Depreciation of Fixed Assets
Party B has made provisions or reserves for the depreciation of fixed
assets in accordance with PRC Accounting System for Enterprises.
3.3. Accounting Books and Records
At the Establishment Date of Party B, all the accounts, account books,
ledger accounts, financial records and other records of Party B:
3.3.1. are owned by Party B;
3.3.2. have been comprehensively, properly and accurately kept and
completed;
23
3.3.3. have excluded material errors or differences of any kind; and
3.3.4. give a true, fair and accurate view to its financial,
contractual and business transaction position.
3.4. From the Valuation Date to the Effective Date of the Restructuring
3.4.1. Party A has operated the business injected into Party B under a
normal, consistent and incessant condition;
3.4.2. No material adverse changes have taken place in any business to
be injected into Party B by Party A.
3.5. Filed Documents
3.5.1. All application forms, detailed information, resolutions and
documents of Party B, which, in accordance with any laws,
regulations and/or legislation applicable to Party B relating to
the incorporation, placement and issue of shares, equity
interests, bonds and other securities, distributed dividends of
Party B and the acts of Party B, shall be filed with any
governmental authority anywhere in the world, have been filed for
record appropriately and accurately in compliance with any laws,
regulations and/or legislation applicable to Party B;
3.5.2. All mortgages granted to or created by Party B (if any) have
been registered pursuant to the relevant laws or regulations
applicable to Party B.
3.6. Documents Owned
All the title documents related to Party B's assets, all executed
agreements with Party B as a party and all original copies of other
documents which are owned or shall be owned by Party B are so owned by
Party B.
3.7. Investigations
Unless otherwise disclosed in the Prospectus, there is no material
investigation or inquiry, unresolved or in progress, relating to the
affairs of Party B initiated by any government or other organization.
24
4. Taxation
4.1. Accounts
Full provisions or reserves for all taxes (including deferred taxes)
which would be levied on or payable by Party B for the period ended at
the Valuation Date have been made in the Financial Report.
4.2. Administration
4.2.1. All tax returns, computations and payments which shall be
submitted by Party B for any taxation purpose have been carried
out pursuant to the required terms and within the required
period, and are accurate and do not involve any material disputes
with any taxation authority;
4.2.2. Party A has not taken any action which may lead to material
changes in, severe violation of or interference with any material
arrangement or agreement entered into between Party A and any
taxation authority in any way;
4.2.3. Party A has complied with, in all respects, all applicable
laws, regulations, rules, decrees, courts' orders or verdicts
with regard to taxation, and has kept, and passed on the records
of aforesaid laws, regulations, rules, decrees, courts' orders or
verdicts to Party B;
4.2.4. All tax returns in respect of Party B's tax liability referred
to in Clause 4.2.1 above for the purpose of annual assessment
have been properly and timely submitted to the taxation
authorities in accordance with any applicable laws, regulations,
rules, decrees, or courts' orders or verdicts and all accounts
submitted to the taxation authorities have met all requirements
therewith.
4.3. Tax Requests, Liability and Exemption
Party A has disclosed to Party B all detailed materials in connection
with all material tax-related matters (including but not limited to
the taxes related to the Injected Assets). Party A and Party B shall
exercise the rights and interests arising thereunder pursuant to the
principles provided in Clause 5, which are set out or contained in the
aforementioned material and are owned but not yet exercised by Party
A.
4.4. Non-arm's Length Transaction
4.4.1. Party A has never recommended that Party B acquire, agree to
acquire any assets, accept or agree to accept any service or
25
facility at prices higher than the market price or not determined
on a fair and reasonable basis;
4.4.2. Party A has never recommended that Party B sell, agree to sell
any assets or accept or agree to accept any service or facility
at prices lower than the market price or not determined on a fair
and reasonable basis; and
4.4.3. Party A has never recommended that Party B participate in any
transaction priced inconsistently with the price actually paid or
received by Party B for taxation purposes.
4.5. This Agreement
The execution and performance of this Agreement and any other
agreements under the Restructuring shall not cause Party B to be
deemed to, in respect of tax, have realized taxable profit or other
monetary item.
5. Finance
5.1. Capital Commitment
Party B has made no material capital commitment except those disclosed
in the Financial Report. Since the Valuation Date, Party A has not
caused Party B to make any material capital expenditure, or incur any
material capital expenditure or agree to sell or alter any material
capital assets or any related interests.
5.2. Dividend and Distribution
During the period between the Establishment Date of Party B and the
date of effectiveness of this Agreement, Party B has neither paid nor
declared any dividend, nor made any other distribution deemed to be
made in cash or in kind, nor made any distribution of any interest,
other income, interests or rights derived from any share or equity
interests of Party B.
5.3. Bank and Other Loans
Unless otherwise disclosed in the Financial Report,
5.3.1. The total amount of loans incurred by Party B does not exceed
the loan limitation provided by its Articles of Association
and/or any laws, regulations, rules, decrees, or courts' orders
or verdicts, or any limitation on borrowing provided by any
binding bonds, contracts or documents.
26
5.3.2. Party B has neither issued, nor agreed on the creation or issue
of borrowed capital.
5.3.3. Since the Effective Date of the Restructuring, Party B has
neither repaid nor been liable for any material debt or liability
outstanding but not yet due, and no event leading to the
aforesaid situations has occurred.
5.3.4. Prior to the date of this Agreement, Party B has not received
any notices, formal or informal, from any creditors requesting
repayment of debts or the mandatory disposal of any of Party B's
assets held by the creditors. No event that may lead to the
aforesaid notice has occurred.
5.3.5. No material mortgage, lien or guaranty, interests or claims
related to all or part of Injected Assets has been created, nor
has any agreement, arrangement or undertaking causing or leading
to the occurrence of the aforementioned matters, has been entered
into except for those created for Party B for the purpose of
securing financing from banks on normal commercial terms and
pursuant to principles of fairness.
5.4. Liabilities
Unless otherwise disclosed in the Financial Report, prior to the date
of this Agreement, Party A has not exercised or claimed to exercise
any lien, claims, other interests or any liabilities related to any
fixed assets of the Injected Assets; and there is no dispute related
directly or indirectly to such fixed assets.
5.5. Working Capital
Party B has sufficient working capital and may continue to operate its
business according to its existing form and its current scale of
operations within 12 months after the Effective Date of the
Restructuring, and may carry out, proceed and complete all orders,
projects and contract obligations binding on Party B pursuant to their
existing terms and conditions.
5.6. Continuous Financing
With regard to any loans, acceptance credits, overdraft, loans or
other financing (all of the above referred to as Financings in this
clause) unpaid or may be secured by Party B,
27
5.6.1. there have been neither a breach of nor failure to comply with
any provision specified in any document related to the
Financings;
5.6.2. the relevant right holders have not taken any action or
threatened to take any action for early repayment;
5.6.3. there have been no material adverse change that may impact on
the continuous securing of the Financing, or give rise to any
adverse changes to the terms and conditions thereof; and
5.6.4. the Restructuring and public listing of Party B or the
Restructuring and/or any other matters contained in such listing
shall not lead to the suspension of such Financings or the
acceleration of the due date thereof.
6. Business Operation
6.1. The effects of Restructuring and Overseas Offering
6.1.1. After prudent and thorough inquires, Party A believes that, to
the best of its knowledge and there is no reasonable ground for
it to believe otherwise, there is no information indicating that
the Restructuring or Overseas Offering of Party B or the
execution of this Agreement or any other matters covered by the
Restructuring, Overseas Offering of Party B or this Agreement
will lead to any of the following events:
(i) any major client of Party B will stop or be entitled to
stop or possibly substantially reduce current business
with Party B; and
(ii) there will be material changes in the management staff
of Party B or in the Injected Assets.
6.1.2. Unless otherwise provided by this Agreement, the Restructuring
or Overseas Offering of Party B or this Agreement or any other
matters covered by the Restructuring, the Overseas Offering of
Party B or this Agreement will not lead to:
(i) contradiction with any term, condition or provision of
any agreement or deed to which Party B is a contracting
party, or with any provision of the articles of
association and/or any law, regulation, legislation,
decree or order
28
applicable to Party B, or with any liability, lease,
contractual liability, judgment, ruling, injunction,
legislation or other limitation or responsibility in
any category or form which is binding on or restricting
any assets of Party B, or lead to breach of contract,
or constitute the non-performance of any obligations;
(ii) the exemption of anyone from its obligations to Party
B, or authorization of anyone to determine such
obligations or to determine any right or interest
enjoyed by Party B;
(iii) the creation, imposition or formation of any liability
in any form over any asset of Party B; and
(iv) the acceleration of the due date of any of the existing
liability of Party B which makes the repayment
thereunder immediate, or the possible acceleration of
such due date which shall make the repayment thereunder
immediate.
6.2. Business Operation
6.2.1. In all respects, Party B shall operate the business and handle
the relevant affairs in accordance with its articles of
association and/or any applicable law, regulation, legislation,
decree and any other documents to which Party B is currently a
contracting party;
6.2.2. Party B is entitled and fully qualified to operate the business
in the present jurisdiction where its business operations are
located; and
6.2.3. Party B has not carried out any activity, or entered into any
contract, or exercised any right which is beyond its power, not
authorized or invalid, and all the documents to which Party B is
a principal party or the party obligated to perform have been
duly affixed with seals and retained by Party B.
6.3. Compliance with Laws and Regulations
Party B and its relevant administrative staff, agents and employees
(during their execution of duties) have committed no act which may
violate any law, regulation, rules or order that may cause Party B to
29
suffer or incur any material fines, punishment, lawsuit or other
liabilities.
6.4. Power of Attorney and Authority
Unless otherwise provided herein and required in the ordinary business
of Party B, neither Party A nor Party B has authorized, implicitly or
explicitly, any person to enter into any contract or undertaking on
behalf of Party B, or has granted any person any other agency right or
power.
6.5. Permits, Licenses, Letter of Consent
6.5.1. Unless otherwise provided herein, Party A has assisted Party B
to obtain, or will obtain before the Overseas Offering from all
relevant government agencies, all permits, licenses and letters
of consent necessary for Party B to carry out its business in a
legal and proper manner, and such permits, licenses and letters
of consent are valid (or will be valid, as the case may be) and
will remain in effect;
6.5.2. Party B has not violated any terms or conditions provided in
any such permits, licenses or letters of consent, nor are there
any factors sufficient to affect the continued effectiveness of
any such permits, licenses and letters of consent.
6.6. Continually Effective Contracts
6.6.1. Unless disclosed to be otherwise in the Prospectus, Party B has
never been a party to any contract, transaction, arrangement or
responsibility of an irregular or abnormal nature.
6.6.2. Detailed and accurate information regarding Party A as one of
the parties to the material contracts, transactions, arrangements
or responsibilities related to the Injected Assets has been
disclosed to Party B on the date of this Agreement.
(i) All such contracts, transactions, arrangements and
undertakings are valid, have not been revoked or
cancelled, and will not be terminated or adversely
affected due to the Restructuring, the Overseas
Offering of Party B, the execution of this Agreement or
any other circumstances. Party A has conducted thorough
and prudent inquiries into such circumstances, and has
formally informed Party B of all the terms, agreements
and conditions contained in such
30
contracts, transactions, arrangements and undertakings
which must be communicated to Party B, and the file
archives of such contracts, transactions, arrangements
and undertakings have been transferred to Party B; and
(ii) Neither Party A nor Party B has received notice of the
breach of any such contract, transaction, arrangement
or undertakings from the other parties to such
contracts, transactions, arrangements or undertakings,
and there is no dispute related to the performance of
obligations between Party B and any third party.
6.7. Breaches of Contract
6.7.1. Party A has not been in violation of any material agreement to
which it is a party; and
6.7.2. Party A will not bear any material liabilities resulting from
any representations or warranties (implicit or explicit) made by
Party A or any other matters.
6.8. All Contracts Made on an Arm's-Length Basis
Party A has not participated in any contract or arrangement not made
on a fully arm's-length basis, and its profits and financial position
during the three-year period prior to the Effective Date of the
Restructuring have not suffered any material adverse effect due to any
contracts or arrangements not made on a fully arm's-length basis.
After thorough and prudent inquiry by Party A, there is no finding
that the profits or financial position of Party B might be affected by
such contracts or arrangements not made on an arm's-length basis.
7. Employment of the Staff
7.1. Employees and the Period of Employment
Unless otherwise set forth in this Agreement, Party B has never
entered into any agreement or other arrangements, regardless of
whether bound by law or not, with any trade union or any organization
which represents any of its employees.
7.2. Normal Remuneration
Party B is not liable to pay, nor has it paid in the past, to any
officer or employee of Party B any amounts other than by normal
salary, remuneration, bonuses, wages or other welfare benefits.
31
7.3. Labor Disputes
Party B or any of its employees has not been involved in any labor
dispute which may cause Party B to be subject to a material adverse
effect and, to the knowledge of Party B, its directors and Party A or
the facts which could be known after making reasonable inquiries,
there is no indication that Party B has been involved in any such
dispute or that any such dispute may be expected to arise due to any
provisions of this Agreement, the Restructuring, or documents executed
for the purpose of the Overseas Offering; or any matters anticipated
to arise in connection with the same.
8. Assets
8.1. Ownership
8.1.1. Prior to the Effective Date of the Restructuring, Party A
enjoys the lawful ownership of the Injected Assets, and is
entitled to assign them to Party B.
8.1.2. Party B shall be the owner of the Injected Assets and enjoy the
valid ownership of or right to use such Injected Asset as the
case may be on the Establishment Date;
8.1.3. Unless otherwise provided for herein and disclosed in the
Financial Report, Party A has never created or agreed to create,
or transferred or agreed to transfer, any charge, mortgage, lien,
bonds or any other security interests or other property interests
over any assets indicated in the Financial Report or acquired
since the date of the Financial Report in connection with the
Injected Assets, and unless otherwise disclosed in the Financial
Report, such assets have never been used in connection with in
any financing lease.
8.2. Adequacy of Assets for Business Operations
8.2.1. Party B's assets are sufficient to effectively and fully
operate any business related to the Injected Assets;
8.2.2. The staff transferred to Party B pursuant to the Restructuring
Plan are sufficient for Party B to effectively operate the
business related to the Injected Assets in the existing manner.
8.3. Insurance
8.3.1. All insurance policies of Party B are valid, policy and there
are no acts or omissions that may cause any insurance to come
invalid or possibly lead to any increase in premium.
32
8.3.2. No insurance policy of Party B is subject to any limitation
containing special or irregular terms, and Party B is not
required to pay any amount in addition to the normal premium.
8.3.3. In regard to the aforementioned policies, Party B has neither
lodged nor may possibly lodge any claims, and there is no
situation that could give rise to any such claims.
8.4. Trade Secrets and Intellectual Property
8.4.1. Party A has never (except in the normal course of business and
usual business) disclosed or allowed the disclosure if promised
or arranged to disclose to any person know-how, trade secrets,
confidential information or the customers list of Party B;
8.4.2. In regard to all the intellectual property licensed by Party B
(including but not limited to the intellectual property specified
in the Prospectus and this Agreement) such intellectual property:
(i) is valid and enforceable;
(ii) has been licensed to Party B pursuant to an effective
license, and with no charge, mortgage, or (unless
otherwise disclosed in the Prospectus) other third
party interests thereon;
(iii) does not violate any other agreements or infringe on
any third person's intellectual property in a manner
that may materially affect the operations of Party B;
and
(iv) is not the subject of any current lawsuit, dispute or
other legal preceding that may materially threaten or
affect the ownership, right of use or validity of such
intellectual property.
8.4.3. There has been no omission by Party A of any material matters
that may cause the aforesaid permits or certificates granted to
Party B to be terminated or constitute a breach of the terms of
such permits or certificates;
8.4.4. Party A has not entered into any agreement which may restrict
the application or disclosure of such as aforementioned
proprietary know-how, business secrets, confidential information
or client or supplier lists of Party B.
33
8.5. Land Use Right
In regard to the land use right injected into Party B by Party A in
the form of an equity investment, aside from the disclosure thereof in
the Prospectus, Party A undertakes that it has properly obtained the
legal right to use such land and is entitled to inject such right into
Party B in the form of an equity investment. In respect of the land
which is injected into Party B in the form of an equity investment for
which Party A has not yet obtained the certificate of land use right,
Party A undertakes to obtain such certificate and inject such land
into Party B within the shortest period of time reasonably practical
following the Establishment Date of Party B. If Party B suffers any
loss as a result of claims brought regarding the right to use such
land, including but not limited to all related claims, lawsuits,
arbitration, losses, compensation, payment, costs, expenses and
expenditures, Party A shall compensate Party B in full.
8.6. Buildings
In regard to the property injected into Party B by Party A in the form
of an equity investment, Party A undertakes that it has properly
obtained the ownership certificate for such property and is entitled
to inject such property into Party B in the form of equity investment.
Provided that Party B suffers losses as a result of claims brought
regarding the ownership of such property, including but not limited to
all related claims, lawsuits, arbitration, losses, compensation,
payments, costs, expenses and expenditures, Party A shall compensate
Party B in full. In regard to any properties which are injected into
Party B in the form of an equity investment for which Party A has not
obtained the ownership certificate therefor, and any of the properties
leased to Party B by Party A pursuant to the Property Leasing
Agreement separately entered into by both parties but for which the
ownership certificate has not been obtained, Party A undertakes:
8.6.1. to obtain the ownership certificate for such property and
inject such property into Party B within the shortest period of
time reasonably practical following the Establishment Date of
Party B;
8.6.2. to assume all fees, expenses, claims arising as a result of or
related to handling the aforesaid matters described in Clause
8.6.1, and to compensate Party B in full for any losses and
liabilities incurred by Party B, including but not limited to
losses sustained by Party B as a result of Party A's failure to
settle the matters described in Clause 8.6.1.
34
9. Environmental Protection
9.1. Party A has not committed any action that severely violates
environmental protection laws and regulations in respect of the
Injected Assets or related business.
9.2. The assets and related business injected into Party B by Party A are
not the subject of any current or pending material claims, whether
civil, criminal or administrative in connection with environmental
protection, investigations, complaints or litigation.
10. Information
10.1. All information set out in this Agreement and its appendices is true,
complete and accurate.
10.2. All information provided to Party B, its lawyers, accountants, and
sponsors for the Listing, and its underwriter and such underwriter's
lawyers and other professional advisers, including but not limited to
the information in relation to Party B's business, activities,
affairs, assets or liabilities, is true, complete and accurate in all
respects.
35
Appendix II
Financial Report
1. Consolidated Balance Sheet of China Life Insurance Company Limited
2. Consolidated Income Statement of China Life Insurance Company Limited
3. Consolidated Cash Flow Statement of China Life Insurance Company Limited
This Appendix can be inspected at any time at the following location:
China Life Insurance Company Limited, Finance Department
36
Appendix III
Injected Assets
Injected Assets specifically include:
1. Cash, bank deposits, securities (including but not limited to government
bonds, enterprises bonds, and securities investment funds), accounts
receivable, buildings, equipment, facilities, projects under construction,
vehicles of transportation, and all other assets listed in the
Restructuring Plan, which are to be injected by Party A and recorded in the
Restructuring Plan.
2. All the Transferred Policies and other contracts and agreements (including
the amendments and supplements to such contracts and agreements) in
connection with the Injected Assets and Party B's personal insurance
business (hereinafter referred to as Transferred Contracts) as well as any
rights and obligations of Party A under Transferred Contracts.
3. If their assignment is permitted by law, all interests under all permits,
licenses, approval certificates, certifications, powers of attorney and any
other similar documents held or owned by Party A in connection with the
operation of the Injected Assets.
4. Rights of request, rights of set-off, claims or any other similar rights
against any third party owned by Party A arising from or in connection with
the Injected Assets.
5. All materials that are owned by Party A in connection with the insurance
business arising out of Transferred Polices and other Transferred
Contracts, including original documents, copies, computer discs, business
records, financial and accounting records, business data, statistics,
training manuals and all relevant technology records, technology
information, technology data, technology handbooks, technology books, R&D
project materials as well as all software relating to the business of Party
B and the intellectual property rights in connection with such software (in
written form or saved on computers or kept in any other ways).
6. Employees hired by Party A and associated with the Injected Assets,
including all relevant personnel records and data regarding to remuneration
and other benefits of such employees.
37
7. Any other assets or liabilities of Party A agreed by Party A and Party B to
be injected into Party B on or before the Establishment Date of Party B.
38
Appendix IV
Legal Proceedings
The following is a list of material ongoing litigation to which Party A is a
party and which concern the Injected Assets:
--------------------------------------------------------------------------------------------------------
Amount subject to
Plaintiff Defendant Cause of Action Dispute (RMB) Status
--------------------------------------------------------------------------------------------------------
Qingshan sub-branch of CLIC Baotou Mingtian Unjust enrichment 1,510,700 Hearing
Baotou Branch Technology Co., Ltd.
--------------------------------------------------------------------------------------------------------
▇▇ ▇▇▇▇ Qiu CLIC Baotou branch Murder of the insured 1,127,000 Hearing
by the claimant
--------------------------------------------------------------------------------------------------------
Jin Ping ▇▇▇ ▇▇▇▇ CLIC Tianjin Branch Premium dispute 2,430,000 Hearing
Accounting Firm Limited
--------------------------------------------------------------------------------------------------------
CLIC Tianjin Branch Guangxia sub-branch Deposit interest 2,250,000 Hearing
of ICBC disputes
--------------------------------------------------------------------------------------------------------
Mazhang sub-branch of CLIC Chikan sub-branch Policy falsification 1,400,000 Hearing
Zhanjiang Branch of Bank of China
Zhanjiang Branch
--------------------------------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇ Xing CLIC Xuchang Branch Murder of the insured 1,500,000 Hearing
--------------------------------------------------------------------------------------------------------
CLIC Puyang Branch ICBC Puyang Branch Deposit dispute 2,614,000 Hearing
--------------------------------------------------------------------------------------------------------
CLIC Changchun Branch Bank of China Deposit dispute 24,000,000 Hearing
Changchun Branch
--------------------------------------------------------------------------------------------------------
China Textile, Grain Chaoyang sub- Insurance policy 8,500,000 Pre-
--------------------------------------------------------------------------------------------------------
39
--------------------------------------------------------------------------------------------------------
and Oil I&E branch of CLIC dispute hearing
Company Ltd. Beijing Branch
--------------------------------------------------------------------------------------------------------
Zhongguancun sub-branch of Chongwen sub-branch Unjust enrichment 2,231,600 Hearing
Beijing City Commercial of CLIC Beijing (usurious interest
Bank Company Limited Branch rate on bank deposit)
--------------------------------------------------------------------------------------------------------
Daqing Petroleum CLIC Beijing Branch Insurance policy 34,599,000 Hearing
Administration Bureau dispute
--------------------------------------------------------------------------------------------------------
40
Appendix V
Restructuring Documents
1. No. 2576 File, issued by the State Office of the State Council.
2. China Life Insurance (Group) Company's Restructuring Plan in connection
with the Establishment of China Life Insurance Company Limited and its
Domestic and Overseas Listings.
3. CIRC Bao ▇▇▇▇ ▇▇ [2003] No.88: Approval of the Restructuring of China Life
Insurance Company.
4. China Securities Supervisory Committee Guo he Han [2002] No12.: Acceptance
of the Application by China Life Insurance Company for Overseas Listing.
5. Ministry of Finance ▇▇▇ ▇▇▇ [2003] No.72: Approval of the Assets Valuation
Review of China Life Insurance Company for the Establishment of the Company
limited by Shares.
6. Ministry of Finance ▇▇▇ ▇▇▇ [2003] No.77: Approval of Certain Matters
Regarding the Management of State Share Ownership in China Life Insurance
Company Limited.
7. CIRC Bao ▇▇▇▇ ▇▇ [2003] No.115: Approval of the Establishment of China Life
Insurance Company Limited.
8. Articles of Association of the China Life Insurance Company Limited.
9. CIRC Bao ▇▇▇▇ ▇▇ [2003] No. 147, Approval of the Restructuring and IPO of
China Life Insurance Company.
10. Insurance Company Legal Person License of China Life Insurance Company
Limited.
11. Business License of China Life Insurance Company Limited (Registration No.:
1000001003796).
This Appendix can be inspected at any time at the following location:
China Life Insurance Company Limited, Administration Office.
41
Appendix VI
Valuation Report
China Certified Accountants & Financial Management. ▇▇▇▇▇ ▇▇▇ Ping Bao Zi [2003]
No.018: Valuation Report in connection with the Establishment of China Life
Insurance Company Limited by China Life (Group) Company.
This Appendix can be inspected at any time at the following location:
China Life Insurance Company Limited, Finance Department.
42
Appendix VII
Electronic Document
The data document as specified in the actuarial database contained in the
electronic document dated June 30, 2003:
43
Appendix VIII
Reinsurance Contracts
1. Surplus Reinsurance Contract between China Life Insurance Company and AIA
Shanghai, entered into on December 31, 1996.
2. Surplus Reinsurance Contract between China Life Insurance Company and AIA
Guangzhou, entered into on December 31, 1996.
3. Surplus Reinsurance Contract between China Life Insurance Company and AIA
Shenzhen, entered into on November 1, 1999 and its Supplemental Contract
entered into on March 28, 2000.
4. Surplus Reinsurance Contract between China Life Insurance Company and China
Reinsurance Company, entered into on January 1, 2000.
5. Quota Share Reinsurance Contract between China Life Insurance Company and
China Reinsurance Company, entered into on March 30, 2000.
6. Quota Share Reinsurance Contract between China Life Insurance Company and
China Reinsurance Company, entered into on September 21, 2001.
44
Appendix IX
List of Assets and Liabilities Transferred to Party B
45
