MEMORANDUM AND ARTICLES OF ASSOCIATION FOR TECH. LIMITED LIABILITY COMPANY 第一章 总则 Chapter 1 General Provision 第二章 宗旨、经营范围 Chapter 2 The Purpose, Scope and Scale of the Business 第三章 投资总额和注册资本 Chapter 3 Total AmountMEMORANDUM AND ARTICLES OF ASSOCIATION
FOR TECH. LIMITED LIABILITY COMPANY
第一章 总则 Chapter 1 General Provision
第二章 宗旨、经营范围 Chapter 2 The Purpose, Scope and Scale of the Business
Chapter 3 Total Amount of Investment and the Registered Capital
第四章 董事会 Chapter 4 The Board of Directors
第五章 经营管理机构 Chapter 5 Business Management Office
第六章 财务会计 Chapter 6 Finance and Accounting
第七章 利润分配 Chapter 7 Profit Sharing
第八章 职工 Chapter 8 Staff and Workers
第九章 工会组织 Chapter 9 The Trade Union Organization
Chapter 10 Duration, Termination and Liquidation of the Joint Venture Company
第十一章 规章制度 Chapter 11 Rules and Regulations
第十二章 适用法律 Chapter 12 Applicable Law
第十三章 附则 Chapter 13 Supplementary Articles
第一章 总则Chapter 1 General Provision
Article 1 In accordance with the "Law of the People's Republic of China on Joint Venture Using Chinese and Foreign Investment" and the joint venture agreement signed, China, (hereinafter referred to as Party A) and Ltd. (hereinafter referred to as Party B), to set up a joint venture, the Memorandum and Articles of Association hereby is formulated.
第二条 合营公司名称Article 2 The name of the joint venture company
The name of the joint venture company shall be Family Information Technology Co. Ltd. in English, and, with the domain name www.aielai.com.
The legal address of the joint venture company is in China.
Article 3 The names and legal addresses of each Party are as follows:
Article 4 The legal form of the joint venture company is a limited liability company.
Each Party is obligated to capitalize the joint venture and perform all duties as stipulated in these Memorandum and Articles of Association and its subsequent amendments.
The profits, risks and losses of the joint venture company shall be shared by the Parties in proportion to their contributions of registered capital. The maximum Liability of each Party is limited to their investment amount.
Article 5 The joint venture company has the status of a legal person and is subject to the jurisdiction and protection of Chinese laws concerned. All activities of the joint venture company shall be governed by the laws, decrees and pertinent rules and regulations of the People's Republic of China.
第二章 宗旨、经营范围Chapter 2 The Purpose, Scope and Scale of the Business
Article 6 The purpose of the joint venture is to deliver excellent consumer products and services to families, provide healthcare information for the development of healthy families, with a view towards supporting the formation of a healthy society, and to make a profit for the investors.
Article 7 Business scope of the joint venture company is e-commerce, retail sales of mother, baby and family products, household and sundry products, appliances, clothing, food products, agricultural by-products (other than those requiring specialized approval), telecommunication products, home remodeling and furnishing products; and advertising.
Article 8 The products of the joint venture company will be sold in the Chinese market and/or overseas market. The company may also develop other lines of service.
第三章 投资总额和注册资本Chapter 3 Total Amount of Investment and the Registered Capital
Article 9 The total amount of investment of the joint venture company is €85,000 Euros.
The registered capital for the joint venture company is ¥590,000 Chinese Yuan, comprised of the Chinese Yuan equivalent of €60,000 Euros, and ¥50,000 Chinese Yuan.
Party A shall invest ¥50,000 Chinese Yuan, representing 7.41% of the registered capital.
Party B shall invest €60,000 Euros, representing 92.59% of the registered capital.
Article 10 The amount of the investment in Article 10 shall be funded by Party A and Party B according to the time limit stipulated in the joint venture agreement.
Article 11 After the investment is funded by the Parties, a Chinese registered accountant engaged by the joint venture company shall audit it and certify the investment. Thereafter the joint venture company shall issue an investment certificate to confirm the date and amount of contribution.
Article 12 Party A shall make an additional in-kind investment, which does not alter the registered capital but affects the profit sharing ratios. Party A shall make an in-kind investment of the business plan valued at least ¥44,500 Chinese Yuan, and an in-kind investment of management expertise, valued at ¥40,500 Chinese Yuan, the latter of which will be accrued to him while he assumes the role of President and may be transferred to his successor(s). Such additional investment increases Party A’s profit share to 20% thereby reducing Party B’s profit share to 80%.
Article13 Within the term of the joint venture, the joint venture company shall not reduce its registered capital.
Neither Party shall be allowed to pledge any part of the investment to any third party as security.
Article 14 Any increase or transfer of registered capital of the joint venture company shall be approved by both Parties and submitted to the original examining and approving authority for approval. The registration procedures for changes shall be dealt with at the original registration and administration office.
第四章 董事会Chapter 4 The Board of Directors
Article 15 The joint venture company shall establish the Board of Directors which is the highest authority of the joint venture company.
Article 16 The Board of Directors shall decide all major issues concerning the joint venture company for the following issues, unanimous approval shall be required:
Amendment of the Memorandum and Articles of Association of the joint venture company;
Discussing and deciding the termination and dissolution of the joint venture company;
Deciding the merger, affiliation and consolidation of the joint venture company with other companies;
4.设立合营公司的分支机构； Deciding to set up subsidiary companies;
Ratifying the medium term and long term development of the joint venture company;
Deciding the credit limit on any lines of credit and issues on purchasing, leasing and mortgage of assets in the joint venture company;
Deciding the proportion of allocation for reserve funds, pension funds and bonuses from the taxed profits of joint venture company;
8.决定合营公司年度利润分配方案； Deciding the distribution of profits;
The following matters require approval by two-thirds majority vote of directors:
1.决定合营年度经营方针和计划； Ratifying an annual operations strategy and plan;
Approving labor contracts and other labor regulations of the joint venture;
Examining and approving the annual business report submitted by the President;
Inviting and dismissing the senior administrative personnel and deciding their salary and welfare may be recommended by the President and/or the Executive Vice President;
Deciding the system of salary and welfare for staff and workers in joint venture company in accordance with the relevant regulations of China;
Defining and adjusting the structure of the joint venture company;
Ratifying fiscal budget, fiscal report and accounting statement;
Deciding the types and scope of insurances for joint venture company;
Deciding the scope of authorized power for the President and Executive Vice President;
Deciding the plan on living houses and other welfare for staff and workers of joint venture company;
Deciding other matters which shall require decision by the Board of Directors.
Engaging and dismissing the President and the Vice Presidents;
Settling disputes between the investor Parties.
Article 17 The Board of Directors shall consist of no fewer than 3 and no more than 7 directors appointed by Parties A and B, in accordance with the proportion of share ownership. The term of office for the directors is one year and may be renewed.
When appointing and replacing directors, a written notice shall be submitted to the Board of Directors and the other Party.
Article 18 The Board of Directors shall convene at least one meeting every year. The chair may convene an interim meeting based on a proposal made by all directors. The Board Meeting will be held in principle in November every year. Any two directors can call an interim meeting giving 30 days notice to all directors.
Article 19 The chair shall give each director a written notice thirty (30) days before the date of the Board Meeting. The notice shall cover the agenda, time and place of the meeting.
Directors may attend the meeting via teleconference.
Article 20 The Board Meeting requires a quorum of over two-thirds of the total number of directors. When the quorum is less than two-thirds, the decisions adopted by the Board Meeting are invalid. Detailed written minutes shall be made for each Board Meeting and signed by the chairperson after approval by directors. The minutes shall be made in Chinese and in English, and shall be filed with the company and emailed or posted to all directors no more than 30 calendar days after meeting.
第五章 经营管理机构Chapter 5 Business Management Office
Article 21 The joint venture company shall establish a management office which shall be responsible for its daily management and shall be operated according to the office manual, which may be adapted by the President under the direction of the Board of Directors. All changes need to be recorded in both the Chinese and English versions of the office manual.
The joint venture company shall have one President, one Executive Vice President and may have one or more Vice President(s), the number of which is to be determined by the Board of Directors. The President and Executive Vice President shall be appointed by the Board of Directors, and they shall be responsible for protecting the interests of the Parties. All other executive officers, with the exception of the legal representative (holder of the company seal), shall be appointed by Party B and shall be responsible for protecting the interests of Party B.
Article 22 The joint venture company is managed by the President and the Executive Vice President under the guidance of the Board of Directors.
The President and the Executive Vice President shall be responsible to the Board of Directors directly, carrying out the decisions of the Board of Directors and organizing the daily operations, technology and management of joint venture company.
Party B shall appoint the legal representative who shall sign off on all expenditures and shall be in charge of the company seal.
Article 23 By the appointment of the Board of Directors, the chair and vice chair of the Board of Directors may concurrently be the President, or Executive Vice President, or Vice President of the joint venture company.
Article 24 The President or Executive Vice President or Vice Presidents shall not hold any positions concurrently of any competitor company without the approval of the Board of Directors.
Article 25 In the event of resignation of the President, Vice Presidents and other senior administrative personnel, such resignation shall be submitted in writing to the Board of Directors 90 days in advance of the effective date of such resignation.
In case any one of the above-mentioned persons conducts graft or serious dereliction of duty, they may be dismissed at any time upon the decision of the Board of Directors in accordance with the company regulations.
第六章 财务会计Chapter 6 Finance and Accounting
Article 26 The finance and accounting of the joint venture company shall be handled in accordance with the "Stipulations of the Finance and Accounting System of the Joint Venture Using Chinese and Foreign Investment" formulated by the Ministry of Finance of the People's Republic of China.
Article 27 The fiscal year of the joint venture company shall be calendar year from January 1 to December 31. All vouchers, receipts, accounting statements and reports, accounting books shall be provided in Chinese. Accounting statements and reports shall be provided in Chinese and English.
Article 28 The joint venture company adopts Chinese Yuan as the currency in which accounting books are kept.
The conversion of Chinese Yuan into other currencies shall be in accordance with the exchange rate of the date of conversion published by the State Administration of Foreign Exchange Control of the People's Republic of China.
Article 29 The joint venture company shall open accounts denominated in Chinese Yuan and foreign currency at a bank agreed upon by the People’s Bank of China.
Article 30 The accounting of the joint venture company shall adopt the internationally used accrual basis and debit and credit accounting system in their work.
Article 31 The accounting books of the joint venture company shall include the following contents:
All cash revenues and expenditures of the joint venture company;
Accounting of registered capital and debt of the joint venture company;
Accounting of registered capital investment, increase and transfers.
Article 32 Within the first three months of each fiscal year, the accounting department shall prepare a certified accountant audited balance sheet and profit and loss statement balance sheet to be submitted to the Board of Directors.
Article 33 Parties of the joint venture company have the right to engage an auditor to undertake an annual financial audit at their own expense. The joint venture company shall provide full access to the auditor.
Article 34 The depreciation term for the fixed assets of the joint venture company shall be decided by the Board of Directors in accordance with the "The Income Tax Law of the People's Republic of China for Foreign Investment Enterprises and Foreign Enterprises".
Article 35 All matters concerning foreign exchange shall be handled in accordance with the "Provisional Regulations for Exchange Control of the People's Republic of China" and other pertinent regulations.
第七章 利润分配Chapter 7 Profit Sharing
Article 36 The joint venture company shall return a 100% return on cash investment to each Party from after tax profits, after which the percentage for the allocation of retained earnings, company expansion funds and staff bonuses shall be decided by the Board of Directors.
Article 37 The joint venture company shall distribute its profits once a year. The profit distribution plan and amount of profit distributed to each Party shall be published within the first three months following each fiscal year.
第八章 职工Chapter 8 Staff and Workers
Article 38 The employment, recruitment, dismissal and resignation of the staff and workers of the joint venture company and their salary, welfare, labor insurance, labor protection, labor discipline and other matters shall be handled according to the "Regulations of the People's Republic of China on Labor Management in Joint Ventures Using Chinese and Foreign Investment" and its implementation rules, and relevant regulations issued by Xinjiang province.
Article 39 The joint venture company has the right to take disciplinary actions, such as warnings, demerit recording and salary reductions against those staff and workers who violate the rules and regulations of the joint venture company. Those with serious cases may be dismissed. Discharging of workers shall be filed with the local labor and personnel department according to Chinese Law.
Article 40 The salary treatment of the staff and workers shall be set by the President and the Executive Vice President according to the needs of the joint venture company as set by the Board of Directors, with reference to the regulations issued by the Urumqi Bureau of Labor, and shall be specified in detail in the labor contract. The salary of the staff and workers shall be increased according to the company’s development and the progress of the worker's ability and skill development.
Article 41 The joint venture company shall ensure normal working conditions according to relevant labor protections regulations of the People’s Republic of China.
第九章 工会组织Chapter 9 The Trade Union Organization
Article 42 The staff and workers of the joint venture company have the right to establish a trade union and carry out activities in accordance with the stipulation of the "Trade Union Law of the People's Republic of China".
Article 43 The trade union in the joint venture company is the representative of the interests of the staff and workers. The tasks of the trade union are: to protect the democratic rights and material interests of the staff and workers pursuant to the law; to assist the joint venture company to arrange and make rational use of welfare funds and bonuses; to organize political, professional, scientific and technical studies, to carry out literary art and sports activities; and to educate staff and workers to observe labor discipline and strive to fulfill the economic tasks of the joint venture company.
Article 44 The trade union may take part in the mediation of disputes arising between the staff and workers and the joint venture company.
第十章 期限、终止、清算Chapter 10 Duration, Termination and Liquidation of the Joint Venture
Article 45 The duration of the joint venture company is forty years. The establishment of the joint venture company shall start from the date on which the business license of the joint venture company is issued.
An application for the extension of the duration proposed by one Party and approved by two-thirds of the Board of Directors, shall be submitted to the original examining and approving authority 6 months prior to the expiry date of the joint venture.
Article 46 The joint venture will be terminated upon the agreement between both Parties that such an action would be in the best interest of the joint venture. In this case, the decision for the termination shall be made by the Board of Directors at a meeting 90 days before the date of termination of the joint venture, and shall be submitted to the original examining and approving authority.
Article 47 Either Party has the right to terminate the joint venture under the following conditions:
1.合营公司期限届满； Expiration of the duration of the joint venture company;
2.合营公司严重亏损，无力继续经营； Inability to continue operations due to heavy losses;
Inability to continue operations due to heavy losses caused by Force Majeure;
Inability to continue operations due to the failure of either Party to fulfill its obligations prescribed in the Memorandum and Articles of Association;
Failure to obtain the desired objectives of the operation with no prospects for the future development of the joint venture company.
Article 48 Upon the expiration of the duration or termination of the joint venture company, the Board of Directors shall work out procedures and principles for the liquidation, and nominate candidates for the liquidation committee for liquidating the assets of the joint venture company.
Article 49 The task of the liquidation committee are: to conduct a thorough audit of the property of the joint venture company, its claims and indebtedness; to work out the statement of assets and liabilities and list of property holdings; to formulate a liquidation plan. All these shall be carried out upon the approval of the Board of Directors.
Article 50 The remaining property after the clearance of debts of the joint venture company shall be carried out upon the approval of the Board of Directors.
Article 51 On completion of the liquidation, the joint venture company shall submit a liquidation report to the original examining and approving authority, go through the formalities for nullifying its registration in the original registration office and hand in its business license at the same time, and make an announcement to the public.
Article 52 After dissolution of the joint venture company, its accounting books shall be left in the care of Party A. Party B shall have full and unhindered access to these books.
第十一章 规章制度Chapter 11 Regulations
Article 53 Following categories of rules and regulations are formulated by the President of the joint venture company and ratified by the Board of Directors:
Management regulations, including the powers and functions of the managerial branches and its working rules and procedures;
2.员工守则； Staff and worker regulations;
3.劳动工资制度； Employment and salary regulations;
System for recording work attendance, promotions, awards and penalties for the staff and workers;
5.员工福利制度； Staff and workers’ benefits regulations;
6.财务制度； Financial system;
7.其它必要的规章制度。 Other necessary rules and regulations.
第十二章 适用法律Chapter 12 Applicable Law
Article 54 The formation of this contract, its validity, interpretation, execution and settlement of the disputes shall be governed by the relevant laws of the People's Republic of China.
第十三章 附则Chapter 13 Supplementary Articles
Article 55 The amendment to the Memorandum and Articles of Association shall be unanimously agreed and decided by the Board of Directors and submitted to the original examining and approving authority for approval.
Article 56 These Memorandum and Articles of Association shall be written in Chinese and in English. Both languages have the same effect. In the events of any discrepancy between the two aforementioned versions, the Chinese version shall prevail.
Article 57 These Memorandum and Articles of Association shall come into effect upon the approval by the relevant department of the People's Republic China.
第五十八条 本章程于 年 月 日由甲、乙双方的授权代表在中国 签字。
Article 58 These Memorandum and Articles of Association are signed in People’s Republic of China by the authorized representatives of both Parties on _________.
Party A： Party B：
Date:______ Date: ________