Exhibit 10.5

Execution Copy

 

 

 

INVESTMENT NUMBER 32681

Loan Agreement

between

BEIJING UNITED FAMILY HOSPITAL CO., LTD.

and

INTERNATIONAL FINANCE CORPORATION

Dated March 7, 2013

 

 

 

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TABLE OF CONTENTS

 

Article/

Section

 

Item

  

Page No.

 

ARTICLE I

     1   

Definitions and Interpretation

     1   

Section 1.01.

 

Definitions

     1   

Section 1.02.

 

Accounting Standards; Financial Calculations

     13   

Section 1.03.

 

Interpretation

     14   

Section 1.04.

 

Business Day Adjustment

     14   

ARTICLE II

     15   

The Loan

     15   

Section 2.01.

 

The Loan

     15   

Section 2.02.

 

Disbursement Procedure

     15   

Section 2.03.

 

Interest

     15   

Section 2.04.

 

Default Rate Interest

     17   

Section 2.05.

 

Repayment

     17   

Section 2.06.

 

Prepayment

     18   

Section 2.07.

 

Fees

     18   

Section 2.08.

 

Currency and Place of Payments

     19   

Section 2.09.

 

Allocation of Partial Payments

     19   

Section 2.10.

 

Increased Costs

     19   

Section 2.11.

 

Unwinding Costs

     19   

Section 2.12.

 

Suspension or Cancellation by IFC

     20   

Section 2.13.

 

Cancellation by the Borrower

     20   

Section 2.14.

 

Taxes

     21   

Section 2.15.

 

Expenses

     21   

Section 2.16.

 

Application of Payments

     22   

ARTICLE III

     23   

Representations and Warranties

     23   

Section 3.01.

 

Representations and Warranties

     23   

Section 3.02.

 

IFC Reliance

     26   

ARTICLE IV

     27   

Conditions of Disbursement

     27   

Section 4.01.

 

Conditions of First Disbursement

     27   

Section 4.02.

 

Conditions of All Disbursements

     28   

Section 4.03.

 

Borrower’s Certification

     29   

Section 4.04.

 

Conditions for IFC Benefit

     30   

 

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ARTICLE V

     30   

Particular Covenants

     30   

Section 5.01.

 

Affirmative Covenants

     30   

Section 5.02.

 

Negative Covenants

     32   

Section 5.03.

 

Reporting Requirements

     37   

Section 5.04.

 

Insurance

     39   

ARTICLE VI

     42   

Events of Default

     42   

Section 6.01.

 

Acceleration after Default

     42   

Section 6.02.

 

Events of Default

     42   

Section 6.03.

 

Bankruptcy

     45   

ARTICLE VII

     45   

Miscellaneous

     45   

Section 7.01.

 

Saving of Rights

     45   

Section 7.02.

 

Notices

     46   

Section 7.03.

 

English Language

     47   

Section 7.04.

 

Term of Agreement

     47   

Section 7.05.

 

Enforcement

     47   

Section 7.06.

 

Disclosure of Information

     49   

Section 7.07.

 

Indemnification; No Consequential Damages

     49   

Section 7.08.

 

Successors and Assignees

     50   

Section 7.09.

 

Amendments, Waivers and Consents

     50   

Section 7.10.

 

Counterparts

     50   

 

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ANNEX A

     51   

PROJECT COST AND FINANCING PLAN

     51   

ANNEX B

     52   

BORROWER/TRANSACTION AUTHORIZATIONS

     52   

ANNEX C

     56   

INVESTMENTS

     56   

ANNEX D

     57   

FINANCIAL DEBT

     57   

ANNEX E

     58   

SUBSIDIARIES

     58   

ANNEX F

     59   

INSURANCE REQUIREMENTS

     59   

ANNEX G

     60   

EXISTING LIENS

     60   

ANNEX H

     61   

PROHIBITED ACTIVITIES

     61   

ANNEX I

     63   

ANTI-CORRUPTION GUIDELINES

     63   

ANNEX J

     66   

INTERCOMPANY PAYABLES

     66   

ANNEX K

     67   

SUBORDINATED FINANCIAL DEBT

     67   

ANNEX L

     68   

LEASE AGREEMENTS

     68   

ANNEX M

     71   

VIE AGREEMENTS

     71   

ANNEX N

     72   

 

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ACTION PLAN

     72   

SCHEDULE 1

     75   

FORM OF CERTIFICATE OF INCUMBENCY AND AUTHORITY

     75   

SCHEDULE 2

     78   

FORM OF REQUEST FOR DISBURSEMENT (LOAN)

     78   

SCHEDULE 3

     81   

FORM OF LOAN DISBURSEMENT RECEIPT

     81   

SCHEDULE 4

     82   

FORM OF SOLVENCY CERTIFICATE

     82   

SCHEDULE 5

     84   

FORM OF SERVICE OF PROCESS LETTER

     84   

SCHEDULE 6

     86   

FORM OF LETTER TO BORROWER’S AUDITORS

     86   

SCHEDULE 7

     88   

FORM OF BORROWER’S CERTIFICATION

     88   

ON DISTRIBUTION OF DIVIDENDS

     88   

SCHEDULE 8

     90   

INFORMATION TO BE INCLUDED IN

     90   

QUARTERLY AND ANNUAL REVIEW OF OPERATIONS

     90   

SCHEDULE 9

     93   

ANNUAL MONITORING REPORT (AMR)

     93   

 

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LOAN AGREEMENT

LOAN AGREEMENT (the “Agreement”) dated March 7, 2013 between BEIJING UNITED
FAMILY HOSPITAL CO., LTD., a company organized and existing under the laws of
the PRC (the “Borrower”) and INTERNATIONAL FINANCE CORPORATION, an international
organization established by Articles of Agreement among its member countries
including the PRC (“IFC”).

RECITAL

The Borrower has requested IFC to provide the loan described in this Agreement
to finance completion of the Project and to partially refinance certain
shareholder’s loans and intercompany payables between the Guarantor, the
Borrower and certain other group companies with respect to the Project; and

IFC is willing to provide the loan upon the terms and conditions set forth in
this Agreement.

ARTICLE I

Definitions and Interpretation

Section 1.01. Definitions. Wherever used in this Agreement, the following terms
have the following meanings:

“Accounting Standards” means generally accepted accounting principles in the
United States from time to time or in accordance with International Financial
Reporting Standards (“IFRS”) promulgated by the International Accounting
Standards Board (“IASB”) (which include standards and interpretations approved
by the IASB and International Accounting Standards issued under previous
constitutions), together with its pronouncements thereon from time to time, and
applied on a consistent basis;

“Action Plan” means the plan or plans developed by the Borrower as set forth in
Annex N setting out specific social and environmental measures to be undertaken
by the Borrower and its Subsidiaries, to enable their respective Operations to
comply with the Performance Standards, as such may be amended or supplemented
from time to time in accordance with the terms hereof;

“Affiliate” means any Person directly or indirectly controlling, controlled by
or under common control with, the Borrower (for purposes of this definition,
“control” means the power to direct the management or policies of a Person,
directly or indirectly, whether through the ownership of shares or other
securities, by contract or otherwise, provided that the direct or indirect
ownership of 50% or more of the voting share capital of a Person is deemed to
constitute control of that Person, and “controlling” and “controlled” have
corresponding meanings);

 

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“Annual Monitoring Report” means the annual monitoring report substantially in
the form attached as Schedule 9 hereto setting out the specific social,
environmental and developmental impact information to be provided by the
Borrower in respect of its and its Subsidiaries’ Operations, as such may be
amended or supplemented from time to time in accordance with IFC’s consent;

“Applicable Exchange Rate” means (i) the official RMB to Dollars middle rate for
foreign currency of the People’s Bank of China as published on the website of
SAFE http://www.safe.gov.cn at 8 a.m. Beijing time on the relevant date of
calculation; or (ii) in the event the above mentioned official RMB to Dollars
rate of the People’s Bank of China is not available due to the occurrence of an
Inconvertibility Event or for any other reason, the market rate of exchange for
RMB to Dollars as determined by the relevant Affected Senior Lender acting upon
its reasonable discretion;

“Applicable S&E Law” means all applicable statutes, laws, ordinances, rules and
regulations of the Country, including but not limited to any license, permit or
other governmental Authorization, imposing liability or setting standards of
conduct concerning any environmental, social, labor, health and safety or
security risks of the type contemplated by the Performance Standards;

“Auditors” means Reanda Certified Public Accountants Co., Ltd. or its
affiliates, or such other firm that the Borrower appoints from time to time as
its auditors pursuant to Section 5.01(e) (Auditors);

“Authority” means any national, regional or local government or governmental,
administrative, fiscal, judicial, or government-owned body, department,
commission, authority, tribunal, agency or entity, or central bank (or any
Person, whether or not government owned and howsoever constituted or called,
that exercises the functions of a central bank);

“Authorization” means any consent, registration, filing, agreement,
notarization, certificate, license, approval, permit, authority or exemption
from, by or with any Authority, whether given by express action or deemed given
by failure to act within any specified time period, and all corporate,
creditors’ and shareholders’ approvals or consents;

“Authorized Representative” means any natural person who is duly authorized by
the Borrower to act on its behalf for the purposes specified in, and whose name
and a specimen of whose signature appear on, the Certificate of Incumbency and
Authority most recently delivered by the Borrower to IFC;

“Beijing United Health One” means Beijing United Family Health Centre, a company
organized and existing under the laws of the PRC, which previously owned and
operated the assets of the Project;

“Borrower” has the meaning set forth in the preamble.

“Business Day” means a day when banks are open for business in New York, New
York, or solely for the purpose of determining the applicable Interest Rate
other than pursuant to Section 2.03(d)(ii) (Interest), London, England;

“Calculation Period” means for any calculation, a period of four consecutive
quarters most recently ended prior to the event requiring the calculation for
which financial statements should have been delivered to IFC pursuant to the
terms and conditions hereof;

“Certificate of Incumbency and Authority” means a certificate provided to IFC
substantially in the form of Schedule 1;

 

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“Change of Control” means any of the following: (i) the Guarantor at any time
and for any reason ceases to own more than 50% of both the economic and voting
interests in the Borrower’s share capital (determined on a fully diluted basis);
or (ii) any person or group other than the Guarantor shall have obtained the
power (whether or not exercised) to elect a majority of the board of directors
of the Borrower;

“Charter” means the articles of association and/or such other constitutive
document, howsoever called, of such Person;

“China Exim” means the Export-Import Bank of China;

“China Exim Loan” means the loan in the amount of $7,577,307 provided by China
Exim to the Borrower for the finance of certain equipment for the Borrower;

“China Exim Loan Agreement” means the loan agreement dated as of July 9, 2012
entered into between the Borrower and China Exim for the China Exim Loan;

“Coercive Practice” has the meaning assigned to it in Annex I;

“Collusive Practice” has the meaning assigned to it in Annex I;

“Compliance Advisor/Ombudsman (CAO)” means the independent accountability
mechanism for IFC that impartially responds to environmental and social concerns
of affected communities and aims to enhance outcomes;

“Consolidated” or “Consolidated Basis” means (with respect to any financial
statements to be provided, or any financial calculation to be made, under or for
the purposes of this Agreement and any other IFC Financing Document) the method
referred to in Section 1.02(c) (Accounting Standards; Financial Calculations);
and the entities whose accounts are to be consolidated with the accounts of the
Borrower are all the Subsidiaries of the Borrower, as the case may be;

“Convertible Currency” means a currency which is freely convertible into other
convertible currencies and freely transferable at any time;

“Corrupt Practice” has the meaning assigned to it in Annex I;

“Country” means the People’s Republic of China;

“Current Assets” means the Consolidated cash, investments classified as “held
for trading”, investments classified as “available for sale”, trade and other
receivables realizable within one year, inventories and prepaid expenses of any
Person or specified group of Persons which are to be charged to income within
one year;

“Current Liabilities” means the Consolidated liabilities of any Person or
specified group of Persons falling due on demand or within one year (including
the portion of Long-term Debt falling due within one year);

 

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“Current Ratio” means the result obtained by dividing Current Assets of such
Person (less prepaid expenses) by Current Liabilities of such Person;

“DEG” means Deutsche Investitions – und Entwicklungsgesellschaft mbH, the German
Investment and Development Company;

“DEG Loan” means the $5,000,000 loan to be provided by DEG to the Borrower, for
the primary purpose of financing the Transaction;

“DEG Loan Agreement” means the loan agreement for the DEG Loan entered or to be
entered into between the Borrower and DEG;

“DEG Security” means the security created by or pursuant to the DEG security
documents to secure all sums owing by the Borrower to DEG under the DEG Loan
Agreement and any related financing document to which it is a party;

“Derivative Transaction” means any swap agreement, cap agreement, collar
agreement, futures contract, forward contract or similar arrangement with
respect to interest rates, currencies or commodity prices;

“Disbursement” means any Disbursement of the Loan, as the context requires;

“Dollars” and “$” means the lawful currency of the United States of America;

“EBITDA” means for the relevant Calculation Period for any Person or specified
group of Persons, Net Income for such period (without giving effect to (x) any
extraordinary gains or losses, (y) any non-cash income and expenses, and (z) any
gains or losses from sales of assets other than inventory sold in the ordinary
course of business) adjusted by adding thereto (in each case to the extent
deducted in determining Net Income for such period), without duplication, the
amount of (i) total interest expense (inclusive of amortization of deferred
financing fees and other original issue discount and banking fees, charges and
commissions (e.g., letter of credit fees and commitment fees)) of such Person or
specified group of Persons determined on a Consolidated Basis for such period,
(ii) tax expense based on income and foreign withholding taxes for such Person
or specified group of Persons determined on a Consolidated Basis for such
period, and (iii) all depreciation and amortization expense of such Person or
specified group of Persons determined on a Consolidated Basis for such period;

“Equity Pledge” means the equity pledge executed by Chindex Healthcare Holdings
Limited (“CHH”) over 55% of its equity interest in the Borrower in favor of IFC
in agreed form;

“Event of Default” means any one of the events specified in Section 6.02 (Events
of Default);

“Financial Debt” means as to any Person:

 

  (i) any indebtedness of such Person for or in respect of borrowed money;

 

  (ii) the outstanding principal amount of any bonds, debentures, notes, loan
stock, commercial paper, acceptance credits, bills or promissory notes drawn,
accepted, endorsed or issued by such Person;

 

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  (iii) any indebtedness of such Person for or in respect of the deferred
purchase price of assets or services (except trade accounts incurred and payable
in the ordinary course of business to trade creditors of such Person within 90
days of the date they are incurred and which are not overdue);

 

  (iv) non-contingent obligations of such Person to reimburse any other Person
for amounts paid by that Person under a letter of credit or similar instrument
(excluding any letter of credit or similar instrument issued for the account of
such Person with respect to trade accounts that are payable in the ordinary
course of business to trade creditors of such Person within 90 days of the date
of determination and which are not overdue);

 

  (v) the amount of any obligation of such Person in respect of any Financial
Lease;

 

  (vi) amounts raised by such Person under any other transaction having the
financial effect of a borrowing and which would be classified as a borrowing
(and not as an off-balance sheet financing) under the Accounting Standards;

 

  (vii) the amount of the obligations of such Person under derivative
transactions entered into in connection with the protection against or benefit
from fluctuation in any rate or price (but only the net amount owing by such
Person after marking the relevant derivative transactions to market);

 

  (viii) all indebtedness of the types described in the foregoing items secured
by a Lien on any property owned by such Person, whether or not such indebtedness
has been assumed by such Person;

 

  (ix) all obligations of such Person to pay a specified purchase price for
goods and services, whether or not delivered or accepted (i.e., take or pay or
similar obligations);

 

  (x) any repurchase obligation or liability of such Person with respect to
accounts or notes receivable sold by such Person, any liability of such Person
under any sale and leaseback transactions that do not create a liability on the
balance sheet of such Person, any obligation under a “synthetic lease” or any
obligation arising with respect to any other transaction which is the functional
equivalent of or takes the place of borrowing but which does not constitute a
liability on the balance sheet of such Person;

 

  (xi) the amount of any obligation in respect of any guarantee or indemnity
given by such Person for any of the foregoing items incurred by any other
Person; and

 

  (xii) any premium payable by such Person on a redemption or replacement of any
of the foregoing items;

“Financial Lease” means any lease or hire purchase contract which would, under
the Accounting Standards, be treated as a finance or capital lease;

“Financial Plan” means the proposed sources of financing for the Transaction as
set forth in Annex A;

“Financial Year” means with respect to the Borrower and each of its
Subsidiaries, the accounting year commencing each year on January 1 and ending
on the following December 31, or such other period as the Borrower, with IFC’s
consent, from time to time designates as its accounting year;

 

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“Fraudulent Practice” means has the meaning assigned to it in Annex I;

“Guarantee Agreement” means the guarantee agreement in agreed form entered or to
be entered into between the Guarantor and IFC pursuant to which the Guarantor
unconditionally and irrevocably guarantees the payment obligations of the
Borrower under the IFC Financing Documents;

“Guarantor” means Chindex International, Inc., a company organized and existing
under the laws of the State of Delaware of the United States of America;

“IFC Financing Documents” means, collectively, this Agreement, the Guarantee
Agreement, the Security Documents, the Share Retention Agreement and the
Subordination Agreement;

“IFC Security” means the security created by or pursuant to the Security
Documents to secure all amounts owing by the Borrower to IFC under this
Agreement and the other IFC Financing Documents to which it is a party;

“Inconvertibility Event” means circumstances where there is an unavailability or
shortage of foreign exchange in the Country or there has occurred a general
moratorium or general debt rescheduling with respect to indebtedness of entities
in the Country, whereby by reason of such circumstances, any Authority of the
Country having the power to regulate foreign exchange does not permit the
Borrower to convert RMB into, and/or transfer, Convertible Currencies in order
to pay obligations denominated in Convertible Currencies which are due and owing
to any Senior Lender under this Agreement or the other Transaction Documents;

“Increased Costs” means the amount certified in an Increased Costs Certificate
to be the net incremental costs of, or reduction in return to, IFC in connection
with the making or maintaining of the Loan that result from:

 

  (i) any change in any applicable law or regulation or directive (whether or
not having the force of law) or in its interpretation or application by any
Authority charged with its administration; or

 

  (ii) compliance with any request from, or requirement of, any central bank or
other monetary or other Authority;

which, in either case, after the date of this Agreement:

 

  (A) imposes, modifies or makes applicable any reserve, special deposit or
similar requirements against assets held by, or deposits with or for the account
of, or loans made by, IFC;

 

  (B) imposes a cost on IFC as a result of IFC having made the Loan or reduces
the rate of return on the overall capital of IFC that it would have achieved,
had IFC not made the Loan;

 

  (C) changes the basis of taxation on payments received by IFC in respect of
the Loan (otherwise than by a change in taxation of the overall net income of
IFC); or

 

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  (D) imposes on IFC any other condition regarding the making or maintaining of
the Loan;

“Increased Costs Certificate” means a certificate provided from time to time by
IFC, certifying:

 

  (i) the circumstances giving rise to the Increased Costs;

 

  (ii) that the costs of IFC have increased or the rate of return has been
reduced;

 

  (iii) that, IFC, in IFC’s reasonable opinion, exercised reasonable efforts to
minimize or eliminate the relevant increase or reduction, as the case may be;
and

 

  (iv) the amount of Increased Costs;

“Insurance Payable” means payments of money received by the Borrower from
insurance companies in respect of insurance claims made on behalf of the
Affiliates of the Borrower;

“Intercreditor and Security Sharing Agreement” means an intercreditor and
security sharing agreement entered or to be entered into between IFC and DEG;

“Intercompany Payable” means any Liability, other than the Service Fees, owed by
the Borrower to any of its Affiliates;

“Interest Determination Date” means except as otherwise provided in
Section 2.03(d)(ii) (Interest), the second Business Day before the beginning of
each Interest Period;

“Interest Payment Date” means March 15, June 15, September 15, and December 15
in each year;

“Interest Period” means each period of 3 months in each case beginning on an
Interest Payment Date and ending on the day immediately before the next
following Interest Payment Date, except in the case of the first period
applicable to each Disbursement when it means the period beginning on the date
on which that Disbursement is made and ending on the day immediately before the
next following Interest Payment Date;

“Interest Rate” means for any Interest Period, the rate at which interest is
payable on the Loan during that Interest Period, determined in accordance with
Section 2.03 (Interest);

“Investment” has the meaning specified in Section 5.02(1) (Permitted
Investments);

“Lease Agreements” means the lease agreements entered into between the Borrower
and the respective parties as set forth in Annex L;

“Liabilities” means the aggregate of all obligations (actual or contingent) of
any Person to pay or repay money, including, without limitation:

 

  (i) Financial Debt of such Person;

 

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  (ii) the amount of all liabilities of such Person under any conditional sale
or a transfer with recourse or obligation to repurchase, including, without
limitation, by way of discount or factoring of book debts or receivables;

 

  (iii) taxes (including deferred taxes) of such Person;

 

  (iv) trade accounts that are payable in the ordinary course of business within
90 days of the date they are incurred and which are not overdue (including
letters of credit or similar instruments issued for the benefit of such Person
with respect to such trade accounts);

 

  (v) accrued expenses of such Person, including wages and other amounts due to
employees and other services providers;

 

  (vi) the amount of all liabilities of such Person howsoever arising to redeem
any of its shares; and

 

  (vii) to the extent (if any) not included in the definition of Financial Debt,
the amount of all liabilities of any other Person to the extent such Person
guarantees them or otherwise obligates itself to pay them;

“Liabilities to Tangible Net Worth Ratio” means the result obtained by dividing
Liabilities by Tangible Net Worth;

“LIBOR” means the British Bankers’ Association (“BBA”) interbank offered rates
for deposits in the Loan Currency which appear on the relevant page of the
Telerate Service (currently page 3750) or, if not available, on the relevant
pages of any other service (such as Reuters Service or Bloomberg Financial
Markets Service) that displays such BBA rates; provided that if BBA for any
reason ceases (whether permanently or temporarily) to publish interbank offered
rates for deposits in the Loan Currency, “LIBOR” shall mean the rate determined
pursuant to Section 2.03(d) (Interest);

“Lien” means any mortgage, pledge, charge, assignment, hypothecation, security
interest, title retention, preferential right, trust arrangement, right of
set-off, counterclaim or banker’s lien, privilege or priority of any kind having
the effect of security, any designation of loss payees or beneficiaries or any
similar arrangement under or with respect to any insurance policy or any
preference of one creditor over another arising by operation of law;

“Loan” means the loan specified in Section 2.01 (The Loan) or, as the context
requires, the principal amount of the Loan outstanding from time to time;

“Loan Currency” means Dollar or $;

“Long-term Debt” means Financial Debt whose final maturity falls due more than
one year after the date it is incurred (including the current maturities
thereof);

“Market Disruption Event” means that, before the close of business in London on
the Interest Determination Date for the relevant Interest Period, the cost to
IFC of funding the Loan would be in excess of LIBOR;

 

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“Material Adverse Effect” means a material adverse effect on:

 

  (i) the Borrower or the Guarantor’s business, Operations, property,
liabilities, condition (financial or otherwise), prospects or the carrying on of
the Borrower or the Guarantor’s business or Operations;

 

  (ii) the implementation of the Transaction, the Project or the Financial Plan;
or

 

  (iii) the ability of the Borrower or of the Guarantor to comply with their
respective obligations under the IFC Financing Documents to which any of them is
a party;

“Net Income” means for any period, the excess (if any) of gross income over
total expenses (provided that income taxes shall be treated as part of total
expenses) during such period for any Person or specified group of Persons;

“Non-Cash Items” means for any period, the net aggregate amount (which may be a
positive or negative number) of all non-cash “income” (as a negative item) and
non-cash “expense” (as a positive item) items which (under accrual accounting)
were added or subtracted in determining Net Income for any Person or specified
group of Persons for such period, including, without limitation, equity earnings
in Subsidiaries, asset revaluations, depreciation, amortization, deferred taxes,
and provisions for severance pay of staff and workers, provisions for bad debts,
bad debts written off and credits resulting from revaluation of book value of
assets;

“Obstructive Practice” has the meaning assigned to in Annex I;

“Operations” means the operations, activities and facilities of any Person
(including the design, construction, operation, maintenance, management and
monitoring thereof, as applicable) in the Country;

“Other Financing Documents” means the Intercreditor and Security Sharing
Agreement, the DEG Loan Agreement and the China Exim Loan Agreement;

“Performance Standards” means IFC’s Performance Standards on Social &
Environmental Sustainability, dated April 30, 2006, a copy of which has been
delivered to and receipt of which has been acknowledged by the Borrower;

“Permitted Lien” has the meaning specified in Section 5.02(g) (Permitted Liens);

“Person” means any natural person, corporation, company, partnership, firm,
voluntary association, joint venture, trust, unincorporated organization,
Authority or any other entity whether acting in an individual, fiduciary or
other capacity;

“Potential Event of Default” means any event or circumstance which would, with
notice, lapse of time, the making of a determination or any combination thereof,
become an Event of Default;

“PRC” means the People’s Republic of China;

“Pro Forma Basis” means, in connection with any calculation of compliance with
any financial covenant or financial term, the calculation thereof after giving
effect on a pro forma basis to (x) the incurrence of any Financial Debt, and
(y) the permanent repayment of any Financial Debt after the first

 

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day of the relevant Calculation Period, the making of a Restricted Payment or
any other transaction subject to pro forma financial covenant compliance
hereunder consummated during the relevant Calculation Period, with the following
rules to apply in connection therewith:

 

  (i) all Financial Debt (x) incurred or issued after the first day of the
relevant Calculation Period shall be deemed to have been incurred or issued (and
the proceeds thereof applied) on the first day of such Calculation Period and
remain outstanding through the date of determination and (y) permanently retired
or redeemed after the first day of the relevant Calculation Period shall be
deemed to have been retired or redeemed on the first day of such Calculation
Period and remain retired through the date of determination;

 

  (ii) all Financial Debt assumed to be outstanding pursuant to preceding clause
(i) shall be deemed to have borne interest at (x) in the case of fixed rate
Financial Debt, the rate applicable thereto, or (y) in the case of floating rate
Financial Debt, the rates which would have been applicable thereto during the
respective period when the same was deemed outstanding; and

 

  (iii) in making any determination of EBITDA on a Pro Forma Basis, pro forma
effect shall be given to any transaction subject to pro forma financial covenant
compliance hereunder if effected during the respective Calculation Period as if
the same had occurred on the first day of the respective Calculation Period but
without taking into account any pro forma cost savings and expenses;

“Prohibited Activities” means the activities specified in Annex H;

“Project” means the construction, equipping and placing into operation of a
hospital and health care facility to be located in No.2 Jingtai Road, Chaoyang
District, Beijing;

“Project Documents” means:

 

  (i) the Charter of the Borrower;

 

  (ii) the Service Fee Contract; and

 

  (iii) the Lease Agreements;

“Prospective Debt Service and Capital Expenditure Coverage Ratio” means the
ratio obtained by dividing:

 

  (i) the aggregate, for the Financial Year most recently ended prior to the
relevant date of calculation for which audited financial statements are
available, of (A) Net Income for that Financial Year, (B) Non-Cash Items and
(C) the amount of all payments that were due during that Financial Year on
account of interest and other charges on Financial Debt (to the extent deducted
from Net Income);

after deducting from that aggregate the amount of capital expenditure actually
expended to that date or as projected for the entire Financial Year for the
Financial Year in which the relevant date of calculation falls; by

 

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  (ii) the aggregate of (A) all scheduled payments that fall due during the
Financial Year in which the relevant date of calculation falls on account of
principal of Long-term Debt and interest and other charges on all Financial Debt
and (B) without double counting any payment already counted in the preceding
sub-clause (A), any payment made or required to be made to any debt service
account under the terms of any agreement providing for Financial Debt (excluding
voluntary prepayments);

where, for the purposes of clause (ii) above:

 

  (x) subject to sub-clause (y) below, for the computation of interest payable
during any period for which the applicable rate is not yet determined, that
interest shall be computed at the rate in effect at the time of the relevant
date of calculation; and

 

  (y) interest on Short-term Debt payable in the Financial Year in which the
relevant date of calculation falls shall be computed by reference to the
aggregate amount of interest thereon paid during that Financial Year up to the
end of the period covered by the latest quarterly financial statements prepared
by the Borrower multiplied by a factor of 4, 2 or 4/3 depending on whether the
computation is made by reference to the financial statements for the first
quarter, the first two quarters or the first three quarters, respectively;

“Relevant Spread” means 4.70% per annum, which shall be increased to 4.95% from
the date and so long as the Borrower is not in compliance with Section 5.01(q)
(Perfection of Security);

“Restricted Payment” means, with respect to any Person, the (i) declaration or
payment of a dividend, distribution or return of any equity capital to its
stockholders, partners or members or authorization or making of any other
distribution, payment or delivery of property (other than common stock of such
Person) or cash to its stockholders, partners or members in their capacity as
such, or (ii) redemption, retirement, purchase or other acquisition of, or
permitting of any Subsidiary to redeem, retire, purchase or otherwise acquire,
directly or indirectly, any shares of any class of its capital stock outstanding
on or after the date of this Agreement (or any options or warrants issued by
such Person with respect to its capital stock), or setting aside of any funds
for any of the foregoing purposes, or (iii) making of any payment of any kind on
or in respect of Financial Debt held by any Affiliate of such Person. Without
limiting the foregoing, “Restricted Payments” with respect to any Person shall
also include all payments made or required to be made by such Person with
respect to any stock appreciation rights, plans, equity incentive or achievement
plans or any similar plans or setting aside of any funds for the foregoing
purposes;

“RMB” means renminbi, the lawful currency of the Country;

“S&E Management System” means the Borrower’s social and environmental management
system enabling it to identify, assess and manage risks in respect of its and
its Subsidiaries’ Operations on an ongoing basis;

“Sanctionable Practice” means any Corrupt Practice, Fraudulent Practice,
Coercive Practice, Collusive Practice, or Obstructive Practice, as those terms
are defined herein and interpreted in accordance with the Anti-Corruption
Guidelines attached to this Agreement as Annex I.

 

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“Security Documents” means the documents providing for the IFC Security
consisting of:

 

  (i) the Equity Pledge; and

 

  (ii) any other security documents agreed between the parties from time to
time;

“Senior Lender” means each of IFC and DEG individually (together, the “Senior
Lenders”);

“Service Fee” means any payment of any kind that is payable by the Borrower
under or in connection with the Service Fee Contract or otherwise in connection
with the management of the Borrower;

“Service Fee Contract” means a service fee contract dated January 1, 2011
entered into between the Borrower and the Guarantor;

“Share Retention Agreement” means a share retention agreement entered or to be
entered into among Roberta Lipson, the Daniel Lipson Plafker Trust, the Jonathan
Lipson Plafker Trust and IFC in agreed form;

“Short-term Debt” means all Financial Debt other than Long-term Debt;

“Subordinated Intercompany Payable” means the Intercompany Payable owed by the
Borrower to Beijing United Health One in the amount of up to RMB48,760,241, and
which is subordinated to IFC and DEG under the Subordination Agreement, ;

“Subordination Agreement” means the subordination agreement entered or to be
entered into among Beijing United Health One, the Borrower, DEG and IFC in
agreed form;

“Subsidiary” means with respect to any Person, any Affiliate over 50% of whose
capital is owned, directly or indirectly, by that Person;

“Tangible Net Worth” means with respect to any Person, the aggregate of:

 

  (i) (A)   the amount paid up or credited as paid up on the share capital of
such Person; and

 

  (B) the amount standing to the credit of the reserves of such Person
(including, without limitation, any share premium account, capital redemption
reserve funds and any credit balance on the accumulated profit and loss
account);

after deducting from the amounts in (A) and (B):

 

  (w) any debit balance on the profit and loss account or impairment of the
issued share capital of such Person (except to the extent that deduction with
respect to that debit balance or impairment has already been made);

 

  (x) amounts set aside for dividends to the extent not already deducted from
equity;

 

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  (y) amounts of deferred tax assets; and

 

  (z) amounts attributable to capitalized items such as goodwill, trademarks,
deferred charges, licenses, patents and other intangible assets; and

 

  (ii) if applicable, that part of the net results of operations and the net
assets of any Subsidiary of such Person attributable to interests that are not
owned, directly or indirectly, by such Person;

“Taxes” means any present or future taxes, withholding obligations, duties and
other charges of whatever nature levied by any Authority;

“Transaction” means the financing of the completion of the Project and the
partial refinancing of certain Intercompany Payables that were originally used
to finance the Project;

“Transaction Documents” means:

 

  (i) the IFC Financing Documents;

 

  (ii) Other Financing Documents; and

 

  (iii) the Project Documents;

“VIE” means each of Beijing Access Health Hospital Management Co., Ltd. and
Beijing United Family Hospital Management Co., Ltd.;

“VIE Arrangements” means any legal relationship or arrangement created by or
pursuant to the VIE Agreements;

“VIE Agreements” means the agreements entered into between a Borrower’s
Affiliate and the shareholders of the VIEs, including, but not limited to, the
documents listed in Annex M;

“World Bank” means the International Bank for Reconstruction and Development, an
international organization established by Articles of Agreement among its member
countries.

Section 1.02. Accounting Standards; Financial Calculations. (a) All financial
calculations to be made under, or for the purposes of, this Agreement and any
other IFC Financing Document shall be made in accordance with the Accounting
Standards and, except as otherwise required in this Agreement or to conform to
any provision of this Agreement, shall be calculated from the then most recently
issued quarterly financial statements which the Borrower is obligated to furnish
to IFC under Section 5.03(a) (Quarterly Financial Statements and Reports);
provided that, if the Borrower notifies IFC that the Borrower requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in the Accounting Standards or in the
application thereof on the operation of such provision (including the effects of
the application or discontinuance of the application of accounting for the
effects of regulation to all or any portion of the Borrower’s operations), or if
IFC notifies the Borrower that it requests an amendment to any provision hereof
for such purpose, regardless of whether any such notice is given before or after
such change in the Accounting Standards or in the application

 

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thereof, then such provision shall be interpreted on the basis of the Accounting
Standards as in effect and applied immediately before such change shall have
become effective until such notice shall have been withdrawn or such provision
amended in accordance herewith.

(b) Where quarterly financial statements from the last quarter of a Financial
Year are used for the purpose of making certain financial calculations then, at
IFC’s option, those calculations may instead be made from the audited financial
statements for such Financial Year.

(c) If a financial calculation is to be made under or for the purposes of this
Agreement or any other IFC Financing Document on a Consolidated Basis, that
calculation shall be made by reference to the sum of all amounts of similar
nature reported in the relevant financial statements of each of the entities
whose accounts are to be consolidated with the accounts of the Borrower plus or
minus the consolidation adjustments customarily applied to avoid double counting
of transactions among any of those entities, including the Borrower.

Section 1.03. Interpretation. In this Agreement, unless the context otherwise
requires:

(a) headings are for convenience only and do not affect the interpretation of
this Agreement;

(b) words importing the singular include the plural and vice versa;

(c) a reference to an Annex, Article, party, Schedule or Section is a reference
to that Article or Section of, or that Annex, party or Schedule to, this
Agreement;

(d) a reference to a document includes an amendment or supplement to, or
replacement or novation of, that document but disregarding any amendment,
supplement, replacement or novation made in breach of this Agreement;

(e) a reference to a party to any document includes that party’s successors and
permitted assigns; and

(f) a document in “agreed form” is a document which is previously agreed in
writing by or on behalf of the Borrower and IFC;

Section 1.04. Business Day Adjustment. (a) When an Interest Payment Date is not
a Business Day, then such Interest Payment Date shall be automatically changed
to the next Business Day in that calendar month (if there is one) or the
preceding Business Day (if there is not).

(b) When the day on or by which a payment (other than a payment of principal or
interest) is due to be made is not a Business Day, that payment shall be made on
or by the next Business Day in that calendar month (if there is one) or the
preceding Business Day (if there is not).

 

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ARTICLE II

The Loan

Section 2.01. The Loan. Subject to the provisions of this Agreement, IFC agrees
to lend a loan (the “Loan”) consisting of a principal amount of $6,000,000.

Section 2.02. Disbursement Procedure.

(a) The Borrower may request Disbursements by delivering to IFC, at least 10
Business Days prior to the proposed date of disbursement, a Disbursement request
substantially in the form of Schedule 2.

(b) Each Disbursement shall be made by IFC at a bank in New York, New York for
further credit to the Borrower’s account at a bank in the Country, or any other
place acceptable to IFC, all as specified by the Borrower in the relevant
Disbursement request.

(c) Each Disbursement (other than the last one) shall be made in an amount of
not less than $1,000,000.

(d) The Borrower shall deliver to IFC a receipt, substantially in the form of
Schedule 3, within 5 Business Days following each Disbursement.

Section 2.03. Interest. Subject to the provisions of Section 2.04 (Default Rate
Interest), the Borrower shall pay interest on the Loan in accordance with this
Section 2.03:

(a) During each Interest Period, the Loan (or, with respect to the first
Interest Period for each Disbursement, the amount of that Disbursement) shall
bear interest at the applicable Interest Rate for that Interest Period.

(b) Interest on the Loan shall accrue from day to day, be prorated on the basis
of a 360-day year for the actual number of days in the relevant Interest Period
and be payable in arrears on the Interest Payment Date immediately following the
end of that Interest Period; provided that with respect to any Disbursement made
less than 15 days before an Interest Payment Date, interest on that Disbursement
shall be payable commencing on the second Interest Payment Date following the
date of that Disbursement.

(c) The Interest Rate for any Interest Period shall be the rate which is the sum
of:

 

  (i) the Relevant Spread; and

 

  (ii) LIBOR on the Interest Determination Date for that Interest Period for 3
months (or, in the case of the first Interest Period for any Disbursement, for 1
month, 2 months, or 3 months, whichever period is closest to the duration of the
relevant Interest Period (or, if two periods are equally close, the longer one))
rounded upward to the nearest three decimal places.

 

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(d) If, for any Interest Period, IFC cannot determine LIBOR by reference to the
Telerate Service or any other service that displays BBA rates, IFC shall notify
the Borrower and shall instead determine LIBOR:

 

  (i) on the second Business Day before the beginning of the relevant Interest
Period by calculating the arithmetic mean (rounded upward to the nearest three
decimal places) of the offered rates advised to IFC on or around 11:00 a.m.,
London time, for deposits in the Loan Currency and otherwise in accordance with
Section 2.03(c)(ii), by any 4 major banks active in the Loan Currency in the
London interbank market, selected by IFC; provided that if less than four
quotations are received, IFC may rely on the quotations so received if not less
than 2; or

 

  (ii) if less than 2 quotations are received from the banks in London in
accordance with subsection (i) above, on the first day of the relevant Interest
Period, by calculating the arithmetic mean (rounded upward to the nearest three
decimal places) of the offered rates advised to IFC on or around 11:00 a.m., New
York time, for loans in the Loan Currency and otherwise in accordance with
Section 2.03(c)(ii), by a major bank or banks in New York, New York selected by
IFC.

(e) Subject to any alternative rate of interest agreed as contemplated by
Section 2.03(f) below, if a Market Disruption Event occurs in relation to all or
any part of the Loan for any Interest Period, IFC shall promptly notify the
Borrower of such event and the relevant Interest Rate, or a portion of either,
for that Interest Period shall be the rate which is the sum of:

 

  (i) the Relevant Spread; and

 

  (ii) either (A) the rate which expresses as a percentage rate per annum the
cost to IFC of funding its participation in the Loan from whatever source it may
reasonably select or (B) at the option of IFC, LIBOR for the relevant period as
determined in accordance with Section 2.03(c)(ii) above;

 

     (f) (i)

If a Market Disruption Event occurs in relation to the Loan and the Borrower so
requires, within five Business Days of the notification by IFC pursuant to
Section 2.03(e) above, IFC and the Borrower shall enter into good faith
negotiations (for a period of not more than 30 days) with a view to agreeing a
substitute basis for determining the rate of interest applicable to the Loan.

 

  (ii) Any alternative basis agreed pursuant to sub-paragraph (i) above shall
take effect in accordance with its terms and be binding on each party hereto.

 

  (iii) If agreement cannot be reached, the Borrower may prepay the relevant
portion of the Loan in accordance with Section 2.06(a) (Prepayment).

(g) On each Interest Determination Date for any Interest Period, IFC shall
determine the Interest Rate applicable to that Interest Period and promptly
notify the Borrower of that rate.

(h) The determination by IFC, from time to time, of the applicable Interest Rate
shall be final and conclusive and bind the Borrower (unless the Borrower shows
to IFC’s reasonable satisfaction that the determination involves manifest
error).

 

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Section 2.04. Default Rate Interest. (a) Without limiting the remedies available
to IFC under this Agreement or otherwise (and to the maximum extent permitted by
applicable law), if the Borrower fails to make any payment of principal or
interest (including interest payable pursuant to this Section) or any other
payment provided for in Section 2.07 (Fees) when due as specified in this
Agreement (whether at stated maturity or upon acceleration), the Borrower shall
pay interest on the amount of that payment due and unpaid at the rate which
shall be the sum of 2% per annum above the Interest Rate in effect from time to
time;

(b) Interest at the rate referred to in Section 2.04(a) shall accrue from the
date on which payment of the relevant overdue amount became due until the date
of actual payment of that amount (as well after as before judgment), and shall
be payable on demand or, if not demanded, on each Interest Payment Date falling
after any such overdue amount became due.

Section 2.05. Repayment.

(a) Subject to Section 1.04 (Business Day Adjustment) and the allocations and
corresponding adjustments in the principal amounts made pursuant to
Section 2.05(b), the Borrower shall repay the Loan on the following Interest
Payment Dates and in the following amounts:

 

Interest Payment Date

   Principal Amount Due ($)  

June 15, 2014

     375,000   

September 15, 2014

     375,000   

December 15, 2014

     375,000   

March 15, 2015

     375,000   

June 15, 2015

     375,000   

September 15, 2015

     375,000   

December 15, 2015

     375,000   

March 15, 2016

     375,000   

June 15, 2016

     375,000   

September 15, 2016

     375,000   

December 15, 2016

     375,000   

March 15, 2017

     375,000   

June 15, 2017

     375,000   

September 15, 2017

     375,000   

December 15, 2017

     375,000   

March 15, 2018

     375,000         6,000,000   

(b) Upon each Disbursement, the amount disbursed shall be allocated for
repayment on each of the respective dates for repayment of principal set forth
in the tables in Section 2.05(a) in amounts which are pro rata to the amounts of
the respective installments shown opposite those dates in those tables (with IFC
adjusting those allocations as necessary so as to achieve whole numbers in each
case).

(c) Any principal amount of the Loan repaid under this Agreement may not be
re-borrowed.

 

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Section 2.06. Prepayment Without prejudice to Section 2.03 (Interest),
Section 2.06(c) (Prepayment), Section 2.10 (Increased Costs) and Section 2.14
(Taxes):

(a) the Borrower may prepay on any Interest Payment Date all or any part of the
Loan, on not less than 15 days prior notice to IFC, but only if:

 

  (i) the Borrower simultaneously pays all accrued interest and Increased Costs
(if any) on the amount of the Loan to be prepaid, together with all other
amounts then due and payable under this Agreement, including the amount payable
under Section 2.11 (Unwinding Costs), if the prepayment is not made on an
Interest Payment Date;

 

  (ii) for a partial prepayment, that prepayment is an amount not less than
$1,000,000; and

 

  (iii) if requested by IFC, the Borrower delivers to IFC, prior to the date of
prepayment, evidence satisfactory to IFC that all necessary Authorizations with
respect to the prepayment have been obtained.

(b) Amounts of principal prepaid under this Section shall be applied by IFC to
all the outstanding installments of the principal amount of the Loan in inverse
order of maturity.

(c) Upon delivery of a notice in accordance with Section 2.06(a), the Borrower
shall make the prepayment in accordance with the terms of that notice.

(d) Any principal amount of the Loan prepaid under this Agreement may not be
re-borrowed.

Section 2.07. Fees.

(a) The Borrower shall pay to IFC a commitment fee:

 

  (i) at the rate of 0.5 % per annum on that part of the Loan that from time to
time has not been disbursed or cancelled, beginning to accrue on the date of
this Agreement; and

 

  (ii) pro rated on the basis of a 360-day year for the actual number of days
elapsed; and

 

  (iii) payable quarterly, in arrears, on each Interest Payment Date, the first
such payment to be due on June 15, 2013.

(b) The Borrower shall also pay to IFC:

 

  (i) a portfolio supervision fee of $10,000 per annum, payable upon receipt of
a statement from IFC; and

 

  (ii) if the Borrower and IFC agree to restructure all or part of the Loan, the
Borrower and IFC shall negotiate in good faith an appropriate amount to
compensate IFC for the additional work of IFC staff required in connection with
such restructuring.

 

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Section 2.08. Currency and Place of Payments.

(a) The Borrower shall make all payments of principal, interest, fees, and any
other amount due to IFC under this Agreement in the Loan Currency, in same day
funds, to the account of IFC at Northern Trust International Banking
Corporation, New York, New York, U.S.A., ABA#026001122, for credit to IFC’s
account number 10215220300, or at such other bank or account in New York as IFC
from time to time designates. Payments must be received in IFC’s designated
account no later than 1:00 p.m. New York time.

(b) The tender or payment of any amount payable under this Agreement (whether or
not by recovery under a judgment) in any currency other than the Loan Currency
shall not novate, discharge or satisfy the obligation of the Borrower to pay in
the Loan Currency all amounts payable under this Agreement except to the extent
that (and as of the date when) IFC actually receives funds in the Loan Currency
in the account specified in, or pursuant to, Section 2.08(a).

(c) The Borrower shall indemnify IFC against any losses resulting from a payment
being received or an order or judgment being given under this Agreement in any
currency other than the Loan Currency or any place other than the account
specified in, or pursuant to, Section 2.08(a). The Borrower shall, as a separate
obligation, pay such additional amount as is necessary to enable IFC to receive,
after conversion to the Loan Currency at a market rate and transfer to that
account, the full amount due to IFC under this Agreement in the Loan Currency
and in the account specified in, or pursuant to, Section 2.08(a).

(d) Notwithstanding the provisions of Section 2.08(a) and Section 2.08(b), IFC
may require the Borrower to pay (or reimburse IFC) for any Taxes, fees, costs,
expenses and other amounts payable under Section 2.14(a) (Taxes) and
Section 2.15 (Expenses) in the currency in which they are payable, if other than
the Loan Currency.

Section 2.09. Allocation of Partial Payments. If at any time IFC receives less
than the full amount then due and payable to it under this Agreement, IFC may
allocate and apply the amount received in any way or manner and for such purpose
or purposes under this Agreement as IFC in its sole discretion determines,
notwithstanding any instruction that the Borrower may give to the contrary.

Section 2.10. Increased Costs. On each Interest Payment Date, the Borrower shall
pay, in addition to interest, the amount which IFC from time to time notifies to
the Borrower in an Increased Costs Certificate as being the aggregate Increased
Costs of IFC accrued and unpaid prior to that Interest Payment Date.

Section 2.11. Unwinding Costs.

(a) If IFC incurs any cost, expense or loss as a result of the Borrower:

 

  (i) failing to borrow in accordance with a request for Disbursement made
pursuant to Section 2.02 (Disbursement Procedure);

 

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  (ii) failing to prepay in accordance with a notice of prepayment;

 

  (iii) prepaying all or any portion of the Loan on a date other than an
Interest Payment Date; or

 

  (iv) after acceleration of the Loan, paying all or a portion of the Loan on a
date other than an Interest Payment Date;

then the Borrower shall immediately pay to IFC the amount that IFC from time to
time notifies to the Borrower as being the amount of those costs, expenses and
losses incurred.

(b) For the purposes of this Section, “costs, expenses or losses” include any
premium, penalty or expense incurred to liquidate or obtain third party
deposits, borrowings, hedges or swaps in order to make, maintain, fund or hedge
all or any part of any Disbursement or prepayment of the Loan, or any payment of
all or part of the Loan upon acceleration.

Section 2.12. Suspension or Cancellation by IFC. (a) IFC may, by notice to the
Borrower, suspend the right of the Borrower to Disbursements or cancel the
undisbursed portion of the Loan in whole or in part:

 

  (i) if the first Disbursement has not been made on or before June 30, 2013, or
such other date as the parties agree;

 

  (ii) if any Event of Default has occurred and is continuing or if the Event of
Default specified in Section 6.02(f) (Expropriation, Nationalization, Etc.) is,
in the reasonable opinion of IFC, imminent;

 

  (iii) if any event or condition has occurred which has or can be reasonably
expected to have a Material Adverse Effect; or

 

  (iv) on or after December 31, 2013.

(b) Upon the giving of any such notice, the right of the Borrower to any further
Disbursement shall be suspended or cancelled, as the case may be. The exercise
by IFC of its right of suspension shall not preclude IFC from exercising its
right of cancellation, either for the same or any other reason specified in
Section 2.12(a) and shall not limit any other provision of this Agreement. Upon
any cancellation the Borrower shall, subject to paragraph (c) of this
Section 2.12, pay to IFC all fees and other amounts accrued (whether or not then
due and payable) under this Agreement up to the date of that cancellation. A
suspension shall not limit any other provision of this Agreement.

(c) In the case of partial cancellation of the Loan pursuant to paragraph (a) of
this Section 2.12, or Section 2.13(a) (Cancellation by the Borrower), interest
on the amount then outstanding of the Loan remains payable as provided in
Section 2.03 (Interest).

Section 2.13. Cancellation by the Borrower.

(a) The Borrower may, by notice to IFC, irrevocably request IFC to cancel, in
whole or in part, the undisbursed portion of the Loan on the date specified in
that notice (which shall be a date not earlier than 30 days after the date of
that notice).

 

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(b) IFC shall, by notice to the Borrower, cancel the undisbursed portion of the
Loan effective as of that specified date if, subject to Section 2.12(c)
(Suspension or Cancellation by IFC), IFC has received all fees and other amounts
accrued (whether or not then due and payable) under this Agreement up to such
specified date.

(c) Any portion of the Loan that is cancelled under this Section 2.13 may not be
reinstated or disbursed.

Section 2.14. Taxes.

(a) The Borrower shall pay or cause to be paid all Taxes (other than taxes, if
any, payable on the overall income of IFC) on or in connection with the payment
of any and all amounts due under this Agreement that are now or in the future
levied or imposed by any Authority of the Country or by any organization of
which the Country is a member or any jurisdiction through or out of which a
payment is made.

(b) All payments of principal, interest, fees and other amounts due under this
Agreement shall be made without deduction for or on account of any Taxes.

(c) If the Borrower is prevented by operation of law or otherwise from making or
causing to be made those payments without deduction, the principal or (as the
case may be) interest, fees or other amounts due under this Agreement shall be
increased to such amount as may be necessary so that IFC receives the full
amount it would have received (taking into account any Taxes payable on amounts
payable by the Borrower under this subsection) had those payments been made
without that deduction.

(d) If Section 2.14(c) applies and IFC so requests, the Borrower shall deliver
to IFC official tax receipts evidencing payment (or certified copies of them)
within 30 days of the date of that request.

Section 2.15. Expenses.

(a) The Borrower shall pay or, as the case may be, reimburse IFC or its
assignees any amount paid by them on account of, all taxes (including stamp
taxes), duties, fees or other charges payable on or in connection with the
execution, issue, delivery, registration or notarization of the Transaction
Documents and any other documents related to this Agreement or any other
Transaction Document.

(b) The Borrower shall pay to IFC or as IFC may direct:

 

  (i) the fees and expenses of IFC’s counsel(s) incurred in connection with:

 

  (A) the preparation of the investment by IFC provided for under this Agreement
and any other Transaction Document;

 

  (B) the preparation and/or review, execution and, where appropriate,
translation and registration of the Transaction Documents and any other
documents related to them;

 

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  (C) the giving of any legal opinions required by IFC under this Agreement and
any other Transaction Document;

 

  (D) the administration by IFC of the investment provided for in this Agreement
or otherwise in connection with any amendment, supplement or modification to, or
waiver under, any of the Transaction Documents;

 

  (E) the registration (where appropriate) and the delivery of the evidences of
indebtedness relating to the Loan and its disbursement;

 

  (F) the occurrence of any Event of Default or Potential Event of Default; and

 

  (G) the release of the IFC Security following repayment in full of the Loan;
and

 

  (ii) the costs and expenses incurred by IFC in relation to efforts to enforce
or protect its rights under any Transaction Document, or the exercise of its
rights or powers consequent upon or arising out of the occurrence of any Event
of Default or Potential Event of Default, including legal and other professional
consultants’ fees properly incurred on a full indemnity basis.

Section 2.16. Application of Payments.

(a) Subject to Section 2.16(b), upon the occurrence and during the continuance
of any Inconvertibility Event the Borrower shall pay all amounts due and owing
under this Agreement or any other Transaction Document to or for the joint and
exclusive benefit of each Senior Lender that as a result of such
Inconvertibility Event is not able to receive or obtain in the contractual place
of payment Convertible Currencies in respect of payment obligations of the
Borrower under this Agreement or any other Transaction Document (each such
Senior Lender, an “Affected Senior Lender”) into one or more escrow accounts in
the Country in the name of, or in trust for, or otherwise for the joint and
exclusive benefit of, all Affected Senior Lenders (“Escrow Account”)(and on
terms satisfactory to all such Affected Senior Lenders) in RMB or, if permitted,
in Dollars, to be held in such Escrow Account until the Inconvertibility Event
no longer exists, such Affected Senior Lenders are able to receive or obtain
such payment or no such amounts remain unpaid at which time, if any such amounts
remain unpaid, all amounts held in such Escrow Account shall be converted into
Dollars and paid to the Affected Senior Lenders and applied against amounts due
and owing under this Agreement or any other Transaction Document and not paid by
virtue of such Inconvertibility Event based on their pro rata shares of such
amounts and, if no such amounts remain unpaid, the amounts standing to the
credit of the Escrow Account shall be returned in full to the Borrower. If,
following conversion into Dollars the amount is greater than that required to
pay all such amounts due and owing or there are no such amounts owing to the
Affected Senior Lenders in respect of which such funds were originally credited
to the Escrow Account, the balance shall be paid to the Borrower, and if the
amount is less than required, the Borrower shall promptly pay the unpaid balance
to the relevant Affected Senior Lender(s).

(b) To the extent that on any date when payments are due and owing to the Senior
Lenders under this Agreement or any other Transaction Document an
Inconvertibility Event has occurred and any Authority of the Country having the
power to regulate foreign exchange has permitted the Borrower to convert RMB
into, and/or transfer, Convertible Currencies in order to pay obligations which
are due and owing to any Senior Lender (a “Non-Affected Senior Lender”), payment
by the Borrower of amounts to

 

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each such Non-Affected Senior Lender shall only be made contemporaneously with
the payment to an Escrow Account in RMB or, if permitted, in Dollars of the
amount that cannot be paid to the Affected Senior Lenders on that date by virtue
of the Inconvertibility Event (applying in relation to any payment in RMB to an
Escrow Account an exchange rate equal to the Applicable Exchange Rate on the day
prior to such payment) and, in the event that the Borrower has insufficient
funds to make payment in full in accordance with this Section 2.16(b) to the
Non-Affected Senior Lender and to the relevant Escrow Account in accordance with
the foregoing provisions of this Section 2.16(b), payments shall be made pro
rata to such amounts owing to all Senior Lenders. For the avoidance of doubt,
for the purposes of this Section 2.16, references to amounts “due” or “owing” on
any date shall exclude amounts that fell due on an earlier date and cannot be
paid by virtue of an Inconvertibility Event but in respect of which the Borrower
has previously already paid the required amount into the relevant Escrow Account
regardless of any intermediate rate variation.

(c) For the avoidance of doubt:

 

  (i) neither the existence of an Inconvertibility Event nor any provision of
this Section 2.16 shall in any way modify, vary or constitute a defence to, the
obligations of the Borrower to make payments in Dollars in full when due and
payable under the Transaction Documents in the required place of payment whether
or not the Borrower is subject to any Inconvertibility Event and payment to an
Escrow Account shall not constitute payment for these purposes; and

 

  (ii) if whilst an Inconvertibility Event is continuing, any Authority of the
Country having the power to regulate foreign exchange permits an Affected Senior
Lender holding funds in an Escrow Account to convert RMB into, and/or transfer,
Convertible Currencies outside the Country then such Affected Senior Lender
shall be entitled to receive and convert and/or transfer its pro rata share of
funds held in such Escrow Account and the provisions of Section 2.16(a) shall
apply thereto and, for the avoidance of doubt, any shortfall remaining after
transfer and/or conversion shall remain due and owing from the Borrower.

(d) Any amount remitted by a Senior Lender to another Senior Lender pursuant to
the Intercreditor and Security Sharing Agreement, shall be treated as having
been paid by the Borrower to such other Senior Lender in accordance with the
terms of this Agreement. On such distribution by a Senior Lender of a payment
received by that Senior Lender from the Borrower, as between such Senior Lender
and the Borrower an amount equal to the amount received by such Senior Lender
and distributed to the other Senior Lender will be treated as not having been
paid by the Borrower.

ARTICLE III

Representations and Warranties

Section 3.01. Representations and Warranties. The Borrower represents and
warrants that:

(a) Organization and Authority. The Borrower is a company duly incorporated and
validly existing under the laws of the jurisdiction of its organization and has
the corporate power and has obtained all required Authorizations to own its
assets, conduct its business as presently conducted and to enter into, and
comply with its obligations under, the Transaction Documents to which it is a
party or will, in the case of any Transaction Document to which it is a party,
not executed as at the date of this Agreement, when that Transaction Document is
executed, have the corporate power to enter into, and comply with its
obligations under, that Transaction Document;

 

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(b) Validity. Each Transaction Document to which the Borrower or the Guarantor
is a party has been, or will be, duly authorized and executed by such Person and
constitutes, or will, when executed constitute, a valid and legally binding
obligation of such Person, enforceable in accordance with its terms, and none of
the agreements listed in Section 4.01(a) (Transaction Documents) has been, or
will be, amended or modified except as permitted under this Agreement;

(c) No Conflict. Neither the making of any Transaction Document to which the
Borrower or the Guarantor is a party nor (when all the Authorizations referred
to in Section 4.01(c) (Authorizations) have been obtained) the compliance with
its terms will conflict with or result in a breach of any of the terms,
conditions or provisions of, or constitute a default or require any consent
under, any indenture, mortgage, agreement or other instrument or arrangement to
which such Person is a party or by which it is bound, or violate any of the
terms or provisions of such Person’s Charter or any Authorization, judgment,
decree or order or any statute, rule or regulation applicable to such Person;

(d) Status of Authorizations. To the best of the Borrower’s knowledge after due
inquiry, the Authorizations specified in Annex B are all the Authorizations
(other than Authorizations that are of a routine nature and are obtained in the
ordinary course of business or Authorizations that the failure to obtain would
not reasonably be expected to result in a Material Adverse Effect) needed by the
Borrower to conduct its business, carry out the Transaction and the Project and
comply with its obligations under this Agreement and each of the other
Transaction Documents to which it is a party and those Authorizations have all
been obtained and are in full force and effect;

(e) No Amendments to Charter. The Charter of the Borrower has not been amended;

(f) No Immunity. Neither the Borrower nor any of its property enjoys any right
of immunity from set-off, suit or execution with respect to their respective
assets or their respective obligations under any Transaction Document;

(g) Disclosure. All information relating to the Borrower, the Transaction and
the Project was and continues to be true and accurate and does not contain any
information which is misleading in any material respect nor does it omit any
information the omission of which makes the information contained in it
misleading in any material respect;

(h) Financial Condition. Since December 31, 2011, the Borrower has not suffered
any change that has a Material Adverse Effect or incurred any substantial loss
or liability;

(i) Financial Statements. The Consolidated and unconsolidated financial
statements of the Borrower for the period ending on December 31, 2011:

 

  (i) have been prepared in accordance with the Accounting Standards, and
present fairly the financial condition of the Borrower as of the date as of
which they were prepared and the results of the operations of the Borrower
during the period then ended;

 

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  (ii) disclose all liabilities (contingent or otherwise) of the Borrower, and
the reserves, if any, for such liabilities and all unrealized or anticipated
liabilities and losses arising from commitments entered into by the Borrower
(whether or not such commitments have been disclosed in such financial
statements);

(j) Employee Benefit Plans. The Borrower is in compliance in all material
respects with its obligations relating to all employee benefit plans
established, maintained or contributed to by it and does not have outstanding
any liabilities with respect to any such employee benefit plans;

(k) Title to Assets, Permitted Liens and Investments. (i) The Borrower has good
and marketable title to all of the assets purported to be owned by it and
possesses a valid leasehold interest in all assets which it purports to lease,
in all cases free and clear of all Liens, other than Permitted Liens, and no
contracts or arrangements, conditional or unconditional, exist for the creation
by the Borrower of any Lien, except for the IFC Security, and (ii) all
Investments of the Borrower are set forth in Annex C;

(l) IFC Security. The provisions of the Security Documents are effective to
create, in favor of IFC, legal, valid and enforceable Liens on or in all of the
IFC Security; and upon completion of all requirements set forth in Section 3.01
(Approvals) and Section 3.02 (Registrations) of the Equity Pledge shall
constitute perfected Liens on the IFC Security with the priority specified in
the Security Documents;

(m) Financial Debt. Annex D sets forth all Financial Debt of the Borrower, and
there exists no outstanding default thereunder;

(n) Taxes. All tax returns and reports of the Borrower required by law to be
filed have been duly filed and all Taxes, obligations, fees and other
governmental charges upon the Borrower, or its properties, income or assets,
which are due and payable or to be withheld, have been paid or withheld, other
than those presently payable without penalty or interest, other than those that
are being contested in good faith and the Borrower shall have made adequate
reserves;

(o) Litigation. The Borrower is neither engaged in nor, to the best of its
knowledge, after due inquiry, threatened by, any litigation, arbitration or
administrative proceedings, the outcome of which, if adversely determined, could
be expected to have a Material Adverse Effect;

(p) Compliance with Law.

 

  (i) To the best of its knowledge and belief, after due inquiry, the Borrower
is not in violation of any applicable law, statute or regulation of any
Authority in connection with the conduct of its respective business or ownership
of its respective property; and

 

  (ii) No judgment or order has been issued which has or may reasonably be
expected to have a Material Adverse Effect:

 

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(q) Environmental Matters.

 

  (i) To the best of its knowledge and belief, after due inquiry, there are no
material social or environmental risks or issues in relation to the Project
other than those identified by the Action Plan;

 

  (ii) Neither the Borrower nor Beijing United Family Health One has received
nor is it or Beijing United Family Health One aware of (A) any existing or
threatened complaint, order, directive, claim, citation or notice from any
Authority or (B) any material written communication from any Person, in either
case, concerning the Project and/or its Operations’ failure to comply with any
matter covered by the Performance Standards which has, or could reasonably be
expected to have, a Material Adverse Effect or any material and adverse impact
on the implementation or operation of its Operations in accordance with the
Performance Standards;

(r) Labor Matters. There are no ongoing or, to the best knowledge of the
Borrower after due inquiry, threatened, strikes, slowdowns or work stoppages by
employees of the Borrower, which could reasonably be expected to have a Material
Adverse Effect;

(s) Use of Proceeds. The proceeds of the Loan shall be utilized solely in
connection with the Transaction (including the immediate payment of certain
Intercompany Payables as set forth in Annex J for payment from the Disbursement)
and the Project;

(t) Sanctionable Practices. Neither the Borrower, nor the Guarantor, nor any of
their respective Affiliates, nor any Person acting on its or any of their
behalf, has committed or engaged in, with respect to any of their respective
Operations or any transaction contemplated by this Agreement, any Sanctionable
Practice;

(u) UN Security Council Resolutions. The Borrower has neither entered into any
transaction nor engaged in any activity prohibited by any resolution of the
United Nations Security Council under Chapter VII of the United Nations Charter;

(v) Intercompany Payables. The Intercompany Payables, including the Subordinated
Intercompany Payables and the Insurance Payables, set forth in Annex J are the
only Liabilities owed by the Borrower to its Affiliates; and

(w) No Material Omissions. None of the representations and warranties in this
Section 3.01 omits any matter the omission of which makes any of such
representations and warranties misleading in any material respect.

Section 3.02. IFC Reliance. The Borrower acknowledges that it makes the
representations and warranties set out in Section 3.01 (Representations and
Warranties) with the intention of inducing IFC to enter into this Agreement and
the other IFC Financing Documents and that IFC enters into this Agreement and
the other IFC Financing Documents on the basis of, and in full reliance on, each
of such representations and warranties.

 

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ARTICLE IV

Conditions of Disbursement

Section 4.01. Conditions of First Disbursement The obligation of IFC to make the
first Disbursement is subject to the fulfillment prior to or concurrently with
the making of that first Disbursement of the following conditions:

(a) Transaction Documents. The Transaction Documents, each in form and substance
satisfactory to IFC, have been entered into by all parties to them and have
become (or, as the case may be, remain) unconditional and fully effective in
accordance with their respective terms (except for this Agreement having become
unconditional and fully effective, if that is a condition of any of those
agreements), and IFC has received a copy of each of those agreements to which it
is not a party;

(b) Certificate of Incumbency and Authority. IFC has received a Certificate of
Incumbency and Authority from each of the Borrower and the Guarantor, dated the
date of the first Disbursement, together with copies of the Charter, by-laws,
resolutions and powers of attorney referred to in such Certificate of Incumbency
and Authority, and all of the foregoing shall be in form and substance
satisfactory to IFC;

(c) Authorizations. The Borrower has obtained, and provided to IFC copies of,
all Authorizations listed in Annex B, and such other Authorizations that may
become necessary for:

 

  (i) the Loan;

 

  (ii) the Transaction, the Project and the implementation of the Financial
Plan;

 

  (iii) the due execution, delivery, validity and enforceability of, and
performance by each of the Borrower and the Guarantor of its respective
obligations under, this Agreement and the other Transaction Documents to which
it is a party and any other documents necessary or desirable to the
implementation of any of those agreements or documents; and

 

  (iv) the remittance to IFC or its assigns in Dollars of all monies payable
with respect to the IFC Financing Documents;

and all those Authorizations are in full force and effect;

(d) Legal Opinions. IFC has received a legal opinion or opinions in form and
substance satisfactory to IFC, of IFC’s counsel in the Country;

(e) CFO’s Certificate. IFC has received a certification from the Borrower’s
chief financial officer (“CFO”) confirming that, as at a date within 60 days
prior to the date of first Disbursement, the Borrower is in compliance with the
provisions of Section 5.01(c) (Accounting and Financial Management) and
containing a brief description of the systems and records in place;

(f) Insurance. IFC has received copies of all insurance policies required to be
obtained pursuant to Section 5.04 (Insurance) and Annex F prior to the date of
first Disbursement, and a

 

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certification of the Borrower’s and its Subsidiaries’ insurers or insurance
agents confirming that such policies are in full force and effect and all
premiums then due and payable under those policies have been paid;

(g) Fees. IFC has received the fees which Section 2.07 (Fees) requires to be
paid, if any, before the date of the first Disbursement;

(h) Legal Fees and Expenses. IFC has received the reimbursement of all invoiced
fees and expenses of IFC’s counsel as provided in Section 2.15(b)(i) (Expenses)
or confirmation that those fees and expenses have been paid directly to that
counsel, in each case, to the extent an invoice approved by IFC has been
submitted to the Borrower at least 5 days prior to the Disbursement;

(i) Authorization of Auditors. IFC has received a copy of the authorization to
the Auditors referred to in Section 5.01(f) (Authorization to Auditors);

(j) Solvency. IFC has received a solvency certificate in the form of Schedule 4
from the chief financial officer of the Borrower;

(k) Appointment of Agent. The Borrower has delivered to IFC evidence,
substantially in the form of Schedule 5, of appointment of an agent for service
of process pursuant to Section 7.05 (Enforcement);

(l) Evidence of Project Expenditure. The Borrower has delivered to IFC a
certificate from the CFO certifying that not less than $38,600,000 has been
incurred by the Borrower on the Project costs specified in Annex A; and

(m) Financial Statements. The Borrower has delivered to IFC two (2) copies of
the Borrower’s most recent unaudited complete financial statements for the
preceding four quarters prepared on a Consolidated Basis, in accordance with the
Accounting Standards, certified by the Borrower’s chief financial officer.

Section 4.02. Conditions of All Disbursements. The obligation of IFC to make any
Disbursement, including the first Disbursement, is also subject to the
conditions that:

(a) No Default. No Event of Default and no Potential Event of Default has
occurred and is continuing;

(b) Use of Proceeds. The proceeds of that Disbursement are, at the date of the
relevant request, needed by the Borrower for the purposes described in
Section 3.01(s) (Use of Proceeds), or will be needed for that purpose within 1
month of that date;

(c) No Material Adverse Effect. Since the date of this Agreement nothing has
occurred which has or could reasonably be expected to have a Material Adverse
Effect;

(d) No Material Loss or Liability. Since the date of this Agreement the Borrower
and its Subsidiaries have not incurred any material loss or liability (except
such liabilities as may be incurred in accordance with Section 5.02 (Negative
Covenants);

 

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(e) Representations and Warranties. The representations and warranties made in
Article III are true and correct in all material respects on and as of the date
of that Disbursement with the same effect as if those representations and
warranties had been made on and as of the date of that Disbursement (but in the
case of Section 3.01(c) (No Conflict), without the words in parentheses);

(f) Legal Opinions. IFC has received a legal opinion or opinions in form and
substance satisfactory to IFC, of IFC’s counsel in the Country with respect to
any matters relating to that Disbursement;

(g) No Violations. After giving effect to that Disbursement, the Borrower and
the Guarantor would not be in violation of:

 

  (i) its Charter;

 

  (ii) any provision contained in any document to which it is a party (including
this Agreement) or by which it is bound; or

 

  (iii) any law, rule, regulation, Authorization or agreement or other document
binding on it directly or indirectly limiting or otherwise its borrowing or
guarantee power or authority or its ability to borrow or guarantee;

(h) Financial Ratios. (Without limiting the generality of Section 4.02(g)),
after taking into account the amount of that Disbursement and any other
Long-term Debt incurred by the Borrower and of any amounts of Tangible Net Worth
paid into the Borrower after the date of the latest financial statements of the
Borrower delivered to IFC pursuant to Section 5.03(a) (Quarterly Financial
Statements and Reports), the Borrower and its Subsidiaries are in compliance
with their obligations under Section 5.01(n)(Financial Ratios);

(i) Pro Rata Disbursement. The Disbursement is made pro rata with the
disbursement of each of the loans provided for in the DEG Loan Agreement;

(j) Legal Fees and Expenses. IFC has received the reimbursement of all invoiced
fees and expenses of IFC’s counsel as provided in Section 2.15(b)(i) (Expenses)
or confirmation that those fees and expenses have been paid directly to that
counsel, in each case, to the extent an invoice approved by IFC has been
submitted to the Borrower at least 5 days prior to the Disbursement; and

(k) Action Plan. The Borrower and its Subsidiaries are in compliance with the
environmental and social requirements as stipulated in the Action Plan.

Section 4.03. Borrower’s Certification. The Borrower shall deliver to IFC with
respect to each request for Disbursement:

(a) certifications, in the form included in Schedule 2, relating to the
conditions specified in Section 4.02 (Conditions of All Disbursements) (other
than the condition in Section 4.02(g)) expressed to be effective as of the date
of that Disbursement, and

(b) such evidence as IFC may reasonably request of the proposed utilization of
the proceeds of that Disbursement or the utilization of the proceeds of any
prior Disbursement.

 

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Section 4.04. Conditions for IFC Benefit. The conditions in Section 4.01
(Conditions of First Disbursement) through Section 4.03 (Borrower’s
Certification) are for the benefit of IFC and may be waived only by IFC in its
sole discretion.

ARTICLE V

Particular Covenants

Section 5.01. Affirmative Covenants. Unless IFC otherwise agrees in writing, the
Borrower shall, and shall cause each of its Subsidiaries to:

(a) Corporate Existence: Conduct of Business. Do all things necessary to
maintain its existence and keep in full force and effect its material rights,
franchises, licenses, permits, copyrights, trademarks and patents, comply with
its charter, conduct its Operations with due diligence and efficiency and in
accordance with sound industry, financial and business practices;

(b) Use of Proceeds: Compliance with Law. Apply the proceeds of the Loan
exclusively as set forth in Section 3.01 (s) (Use of Proceeds), comply in all
material respects (or, in the case of Applicable S&E Law, in all respects) with
all applicable law, statutes, regulations and orders of, and all applicable
restrictions imposed by, all Authorities in respect of its Operations and the
ownership of its property (including applicable law, statutes, regulations,
orders and restrictions relating to environmental standards and controls);

(c) Accounting and Financial Management. Maintain an accounting and control
system, management information system and books of account and other records,
which together adequately reflect truly and fairly the financial condition of
the Borrower and its Subsidiaries and the results of their respective operations
in conformity with the Accounting Standards;

(d) Taxes. Pay and discharge, all taxes, assessments and governmental charges or
levies imposed upon it or upon its income or profits or upon any properties
belonging to it; provided that neither the Borrower nor any of its Subsidiaries
shall be required to pay any such tax, assessment, charge, levy or claim which
is being contested in good faith and by proper proceedings if it has maintained
adequate reserves with respect thereto in accordance with the Accounting
Standards;

(e) Auditors. Appoint and maintain at all times a firm of recognized independent
public accountants acceptable to IFC as auditors of the Borrower, provided that
Reanda Certified Public Accountants Co., Ltd. and its affiliates, or any other
Chinese accounting firm of similar reputation, shall be deemed acceptable to
IFC;

(f) Authorization to Auditors. Irrevocably authorize, in the form of Schedule 6,
the Auditors (whose fees and expenses shall be for the account of the Borrower)
to communicate directly with IFC at any time regarding the Borrower’s financial
statements (both audited and unaudited), and provide to IFC a copy of that
authorization, and, no later than 30 days after any change in Auditors, issue a
similar authorization to the new Auditors and provide a copy thereof to IFC;

 

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(g) Access. Upon IFC’s request and with reasonable prior notice to the Borrower,
permit representatives of IFC and the CAO, during normal office hours, to:

 

  (i) visit any of the sites and premises where the business of the Borrower or
any of its Subsidiaries is conducted;

 

  (ii) inspect any sites, facilities, plants and equipment of the Project, the
Borrower and any of its Subsidiaries;

 

  (iii) have access to the books of account and all records of the Borrower and
any of its Subsidiaries; and

 

  (iv) have access to those employees, agents, contractors and subcontractors of
the Borrower and any of its Subsidiaries who have or may have knowledge of
matters with respect to which IFC seeks information;

provided that all communications from IFC, CAO or their representatives shall be
directed through Roberta Lipson (or the then Chief Executive Officer), Lawrence
Pemble (or the then Chief Operating Officer), Robert Low (or the then Chief
Financial Officer) or another person designated by them and notwithstanding the
foregoing, no such reasonable prior notice shall be necessary if an Event of
Default or Potential Event of Default is continuing;

(h) Environmental Matters. Undertake its respective Operations in compliance
with (i) the Action Plan; and (ii) the applicable requirements of the
Performance Standards;

(i) Review of Annual Monitoring Report. Periodically review the form of the
Annual Monitoring Report and advise IFC as to whether revision of the form is
necessary or appropriate in light of changes to the Borrower’s or its
Subsidiaries’ Operations, or in light of environmental or social risks
identified by the Borrower’s S&E Management System; and revise the form as
agreed with IFC;

(j) S&E Management System. Use all commercially reasonable efforts to ensure the
continuing implementation and operation of the S&E Management System to assess
and manage the social and environmental performance of the Borrower’s Operations
in a manner consistent with the Performance Standards;

(k) Authorizations.

 

  (i) obtain and maintain in force (and where appropriate, renew in a timely
manner) all Authorizations, including without limitation the Authorizations
specified in Annex B, which are necessary for the implementation of the Project,
the carrying out of the business and Operations of the Borrower and its
Subsidiaries generally and the compliance by the Borrower and its Subsidiaries
with all their respective obligations under the Transaction Documents (other
than Authorizations that the failure to obtain is not, in the opinion of IFC at
any time, expected to result and does not result in a Material Adverse Effect);
and

 

  (ii) comply with all the conditions and restrictions contained in, or imposed
on the Borrower or any of its Subsidiaries by, those Authorizations;

(l) Security; Further Assurances. From time to time, execute, acknowledge and
deliver or cause to be executed, acknowledged and delivered such further
instruments as may reasonably be

 

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requested by IFC for perfecting or maintaining in full force and effect the IFC
Security or for reregistering the IFC Security or otherwise and, if necessary,
create and perfect additional Security, to enable the Borrower and its
Subsidiaries to comply with their respective obligations under the IFC Financing
Documents;

(m) Pension Plans. Comply with all requirements relating to any pension or
employee benefit plans;

(n) Financial Ratios. With respect to the Borrower and its Subsidiaries,
maintain at all times the following financial ratios (“Financial Ratios”), on a
Consolidated Basis, in the respective Financial Years:

 

Financial Ratio

   2013      2014      2015 and
thereafter  

Current Ratio of at least:

     1.0         1.1         1.2   

Liabilities to Tangible Net Worth Ratio of not more than:

     2.1         1.7         1.2   

Financial Debt to EBITDA Ratio of not more than:

     3.0         3.0         3.0   

(o) Insurance. With respect to the Borrower and its Subsidiaries, maintain
insurance coverage for their respective business and assets, as specified in
Annex F;

(p) Service Fees. All payment of Service Fees shall be made in accordance with
the Service Fee Contract and this Agreement; and

(q) Perfection of Security. The IFC Security shall be created and the Borrower
shall comply with all requirements set forth in Section 3.01 (Approvals) and
Section 3.02 (Registrations) of the Equity Pledge for the perfection of the IFC
Security as a first ranking security interest in all assets and rights subject
to the Security Documents within 9 months of the date of this Agreement.

Section 5.02. Negative Covenants. Unless IFC otherwise agrees in writing, the
Borrower shall not, and shall cause each of its Subsidiaries not to:

(a) Restricted Payments. Declare or pay any Restricted Payment or pay any
Service Fee, except that:

 

  (i) any Subsidiary of the Borrower may declare and pay cash Restricted
Payments to the Borrower or to any wholly-owned Subsidiary of the Borrower;

 

  (ii) any partially-owned Subsidiary may declare and pay cash Restricted
Payments to its stockholders, provided that the Borrower and its Subsidiaries
must receive at least their proportionate share of any Restricted Payments paid
by such Subsidiary;

 

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  (iii) the Borrower may declare and pay cash dividends required to be paid
under applicable law;

 

  (iv) the Borrower may declare and pay in cash Restricted Payments if, after
giving effect to the payment of such Restricted Payment (A) no Potential Event
of Default or Event of Default shall be continuing or would result therefrom,
(B) the Borrower is in compliance with all financial ratios that shall be
applicable for the year 2015 and thereafter as set forth in Section 5.01(n)
(Financial Ratios) on a Pro Forma Basis, (C) such Restricted Payment is made out
of retained earnings, and (D) the Borrower delivers to IFC a certification
substantially in the form of Schedule 7;

 

  (v) the Borrower may pay in cash Service Fees if, after giving effect to the
payment of such Service Fee (A) no Potential Event of Default or Event of
Default shall be continuing or would result therefrom, provided that if such
Potential Event of Default (but not Event of Default) results from a breach of
any financial ratio set forth in Section 5.01(n) (Financial Ratios), such
payment shall not be restricted unless such failure continues for a period in
excess of 6 months (without prejudice to IFC’s right to declare an Event of
Default as a result of such Potential Event of Default), and (B) such payments
are otherwise made under and strictly in accordance with the Service Fee
Contract.

(b) Capital Expenditures. Other than the Project, incur expenditures or
commitments for expenditures for fixed or other non-current assets except that
after December 31, 2012 such capital expenditures may be made if after giving
effect to such expenditures the Prospective Debt Service and Capital Expenditure
Coverage Ratio based on the most recent Consolidated financial statements of the
Borrower is not less than 1.0;

(c) Permitted Financial Debt. Incur, assume or permit to exist any Financial
Debt except:

 

  (i) the Loan;

 

  (ii) additional Financial Debt specified in the Financial Plan;

 

  (iii) subordinated Financial Debt (including shareholders’ loans) on terms
acceptable to IFC and as set out in Annex K;

 

  (iv) existing Financial Debt, without giving effect to any extensions or
renewal thereof, as set out in Annex D; or

 

  (v) additional Financial Debt of the Borrower if after giving effect to the
incurrence thereof (A) no Potential Event of Default or Event of Default shall
be continuing; and (B) the Borrower is in compliance with all financial ratios
that shall apply for the year 2015 and thereafter as set forth in
Section 5.01(n) (Financial Ratios);

(d) Leases. Enter into any agreement or arrangement to lease any property or
equipment of any kind, except (i) Financial Leases, and then only to the extent
permitted under the other provisions of this Section 5.02 and (ii) otherwise
only to the extent the aggregate payments under all such agreements or
arrangements do not exceed RMB22,000,000 in any Financial Year;

 

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(e) Derivative Transactions. Enter into any Derivative Transaction other than
any derivative transaction which is in the ordinary course of business and which
is not speculative in nature and is intended solely to hedge interest rate or
currency risk related to existing or future liabilities or assets of the
Borrower, or assume the obligations of any party to any Derivative Transaction;

(f) Guarantees and Other Obligations. Enter into any agreement or arrangement to
guarantee or, in any way or under any condition, assume or become obligated for
all or any part of any financial or other obligation of another Person;

(g) Permitted Liens. Create or permit to exist any Lien on any property,
revenues or other assets, present or future, of the Borrower or any of its
Subsidiaries, except for the following (collectively, “Permitted Liens”):

 

  (i) the IFC Security and the DEG Security;

 

  (ii) the naming of the Senior Lenders as loss payee or other named insured
under the Borrower’s insurance policies;

 

  (iii) Liens in existence on the date hereof which are listed, and the property
subject thereto described, in Annex G, without giving effect to any extensions
or renewal thereof;

 

  (iv) any Lien arising from any tax, assessment or other governmental charge or
other Lien arising by operation of law, in each case if the obligation
underlying any such Lien is not yet due or, if due, is being contested in good
faith by appropriate proceedings so long as:

 

  (A) those proceedings do not involve any substantial danger of the sale,
forfeiture or loss of any material asset(s), title thereto or any interest
therein, nor interfere in any material respect with the use or disposition
thereof or the implementation of the Transaction, the Project or the carrying on
of the business or Operations of the Borrower and its Subsidiaries; and

 

  (B) the Borrower has set aside adequate reserves (such reserves to be
reasonably determined by the Borrower in accordance with applicable accounting
principles) sufficient to promptly pay in full any amounts that the Borrower may
be ordered to pay on final determination of any such proceedings;

 

  (v) Liens over assets acquired after the date of this Agreement provided at
all times the net book value of unencumbered assets of the Borrower is at least
150% of the aggregate outstanding amounts of the Loan and DEG Loan;

(h) Arm’s Length Transactions. Enter into any transaction except in the ordinary
course of business on the basis of arm’s length arrangements (including, without
limitation, transactions whereby the Borrower or a Subsidiary might pay more
than the ordinary commercial price for any purchase or might receive less than
the full ex-works commercial price (subject to normal trade discounts) for its
products);

 

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(i) Purchasing or Sales Agency. Establish any sole and exclusive purchasing or
sales agency, other than group purchase agreements with the Guarantor and/or its
Subsidiaries, for a material portion of its purchases or sales;

(j) Profit Sharing Arrangements. Enter into any partnership, profit sharing or
royalty agreement or other similar arrangement whereby the Borrower’s income or
profits are, or might be, shared with any other Person;

(k) Management Contracts. Enter into any management contract or similar
arrangement whereby its business or operations are managed by any other Person
other than the Service Fee Contract with the Guarantor (which restriction,
however, is not intended to prevent the Borrower from outsourcing departmental
functions which are common practice for the type of business carried out by the
Borrower);

(l) Permitted Investments. Make or permit to exist loans (other than certain
Intercompany Payables specified in Annex J) or advances to, or deposits (except
commercial bank deposits in the ordinary course of business) with, other Persons
or investments in any Person or enterprise (“Investments”) other than
(A) short-term marketable securities acquired solely to give temporary
employment to its idle funds, and (B) any loans or advances made for the set-up,
development and construction costs of any new “United Family” branded feeder
clinic in Beijing through the VIE Arrangements, provided that (i) no Potential
Event of Default or Event of Default shall be continuing or would result
therefrom, (ii) the Borrower is in compliance with all financial ratios that
shall apply for the year 2015 and thereafter as set forth in Section 5.01(n)
(Financial Ratios), and (iii) the aggregate amount of any such new loans and
advances made in each Financial Year shall not be more than $3,000,000;

(m) Subsidiaries: Form or have any Subsidiary;

(n) Fundamental Changes. Change (i) its Charter in any manner which would be
inconsistent with the provisions of any Transaction Document (other than the
Intercreditor and Security Sharing Agreement); (ii) its Financial Year; or
(iii) the nature or scope of the Project or change the nature of its present or
contemplated business or Operations;

(o) Asset Sales. Sell, transfer, lease or otherwise dispose of all or a
substantial part of its assets, other than inventory sold in the ordinary course
of business, whether in a single transaction or in a series of transactions,
related or otherwise;

(p) Merger, Consolidation, Etc. Undertake or permit any merger, spin-off,
consolidation or reorganization;

(q) Amendments, Waivers, Etc. of Material Agreements. Terminate, amend or grant
any waiver or consent with respect to any provision of:

 

  (i) any Transaction Document in any material respect; or

 

  (ii)

any agreement or other instrument evidencing or relating to Financial Debt to
the extent such termination, amendment, waiver or consent would (A) increase the
principal amount of any Financial Debt owed by the Borrower under the relevant

 

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  agreement or increase the amount of any of the Financial Debt or other
extensions of credit committed to be made to the Borrower under such agreement
except as permitted under Section 5.02(c); (B) increase the interest rate or
default interest rate payable thereunder; or (C) reduce the tenor of any or all
of the payments of principal thereunder;

(r) Prepayment of Long-term Debt. Make any voluntary, optional or mandatory
prepayment of or repurchase or reacquire for value any Long-term Debt (other
than the Loan) pursuant to any provision of any agreement or note with respect
to that Long-term Debt unless (i) such Long-term Debt is refinanced by using new
Long-term Debt on terms and conditions (as to interest rate, other costs and
tenor) at least as favorable to the Borrower as those of the Long-term Debt
being refinanced, or (ii) the Borrower gives IFC at least 30 days’ advance
notice of its intention to make the proposed prepayment and, if IFC so requires,
the Borrower contemporaneously prepays a proportion of the Loan equivalent to
the proportion of the part of the Long-term Debt being prepaid, such prepayment
to be made in accordance with the provisions of Section 2.06 (Prepayment) except
that there shall be no minimum amount or advance notice period for that
prepayment;

(s) Nature of Business. Engage directly or indirectly in any business other than
the businesses engaged in by the Borrower and its Subsidiaries as of the date
hereof and reasonable extensions thereof and businesses ancillary or
complementary thereto; or engage in any business or own any significant assets
or have any material liabilities relating to any Prohibited Activity as
specified in Annex H;

(t) Winding Up, Liquidation, Merger or Consolidation. Wind up, liquidate or
dissolve its affairs or enter into any partnership, joint venture or transaction
of merger or consolidation, except that any Subsidiary of the Borrower may merge
or consolidate with and into, or be dissolved or liquidated into, the Borrower
or any wholly-owned Subsidiary of the Borrower, so long as (i) the Borrower or
such Subsidiary is the surviving or continuing entity of any such merger,
consolidation, dissolution or liquidation and (ii) any security interests
granted to IFC pursuant to the Security Documents in the assets of such
Subsidiary shall remain in full force and effect and perfected (to at least the
same extent as in effect immediately prior to such merger, consolidation,
dissolution or liquidation) and all actions required to maintain said perfected
status have been taken;

(u) Asset Purchases. Purchase or otherwise acquire (in one or a series of
related transactions) any part of the property or assets (other than purchases
or other acquisitions of inventory, materials and equipment in the ordinary
course of business) of any Person, except that expenditures for fixed or other
non-current assets by the Borrower and its Subsidiaries shall be permitted to
the extent not in violation of Section 5.02(b) (Capital Expenditures);

(v) Sale-Leaseback Transaction. Enter into any sale-leaseback transaction;

(w) Use of Proceeds. Use the proceeds of any Disbursement in the territories of
any country that is not a member of the World Bank or for reimbursements of
expenditures in those territories or for goods produced in or services supplied
from any such country;

(x) UN Security Council Resolutions. Enter into any transaction or engage in any
activity prohibited by any resolution of the United Nations Security Council
under Chapter VII of the United Nations Charter;

 

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(y) Sanctionable Practices. Engage in (and neither the Borrower nor any
Subsidiary shall authorize or permit any Affiliate or any other Person acting on
its behalf to engage in) with respect to its Operations or any transaction
contemplated by this Agreement, any Sanctionable Practices. The Borrower further
covenants that should IFC notify the Borrower of its concerns that there has
been a violation of the provisions of this Section or of Section 3.01(t)
(Sanctionable Practices) of this Agreement, it shall cooperate and it shall
cause each relevant Subsidiary to cooperate, in good faith with IFC and its
representatives in determining whether such a violation has occurred, and shall
respond promptly and in reasonable detail to any notice from IFC, and shall
furnish documentary support for such response upon IFC’s request;

(z) Payable to Group Companies: Other than the Insurance Payables and the
payments required to be made under Section 5.01(b) (Use of Proceeds; Compliance
with Law) from the Disbursement, make any payment or allow any set-off in
respect of any other Intercompany Payable (whether created before or after the
date of this Agreement) unless (x) no Potential Event of Default or Event of
Default is continuing or would result therefrom, and (y) the Borrower is in
compliance with all financial ratios that shall apply as set forth in
Section 5.01 (n) (Financial Ratios) after taking into account the payments; and

(aa) Prohibited Activities. Engage in any of the activities as specified in
Annex H.

Section 5.03. Reporting Requirements. Unless IFC otherwise agrees, the Borrower
shall:

(a) Quarterly Financial Statements and Reports. As soon as available but in any
event within 60 days after the end of each quarter of each Financial Year,
deliver to IFC:

 

  (i) two (2) copies of the Borrower’s unaudited complete financial statements
for such quarter prepared on a Consolidated Basis, in accordance with the
Accounting Standards, certified by the Borrower’s chief financial officer;

 

  (ii) a report by the Borrower on its Operations during that quarter,
substantially in the form of, and addressing the topics listed in, Schedule 8,
including any factors that have or could reasonably be expected to have a
Material Adverse Effect;

 

  (iii) a statement of all transactions during that quarter between the Borrower
and each of its Affiliates, and a certification by an Authorized Representative
that those transactions were on the basis of arm’s-length arrangements.

 

  (iv) a report signed by the Borrower’s chief executive officer and chief
financial officer, concerning compliance with the financial covenants in this
Agreement;

(b) Annual Financial Statements and Reports. As soon as available but in any
event within 120 days after the end of each Financial Year, deliver to IFC
(together with translations in English):

 

  (i) 2 copies of its and each of its Subsidiaries’ complete and audited
financial statements (including consolidating financial statements with respect
to its Subsidiaries) for that Financial Year (which are in agreement with its
books of account and prepared, on a Consolidated Basis, in accordance with the
Accounting Standards, together with an unqualified audit report on them from the
Auditors, all in form satisfactory to IFC;

 

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  (ii) a management letter from the Auditors commenting, with respect to that
Financial Year, on, among other things, the adequacy of the Borrower’s financial
control procedures, accounting systems and management information system, and
for the management letter from the Auditors for Financial Year 2013, a
confirmation by the Auditors that not less than $38,600,000 has been incurred by
the Borrower on the Project costs specified in Annex A;

 

  (iii) a report by the Auditors certifying that, on the basis of its financial
statements:

 

  (A) the Borrower was in compliance with the covenants in Section 5.01(n)
(Financial Ratios); and

 

  (B) the Auditors are not aware of any non-compliance by the Borrower with the
other covenants in Section 5.02 (Negative Covenants);

and, where applicable, detailing any non-compliance; and

 

  (iv) a report by the Borrower on its operations during that Financial Year,
substantially in the form of, and addressing the topics listed in, Schedule 8;

 

  (v) a capital and operating budget for the then-current Financial Year; and

 

  (vi) a statement by the Borrower of all transactions between the Borrower
and/or its Subsidiaries and each of their respective Affiliates, if any, during
that Financial Year, and a certification by the Borrower’s and/or its
Subsidiaries’ chief financial officer that those transactions were on the basis
of arm’s-length arrangements;

(c) Management Letters. Deliver to IFC, promptly following receipt, a copy of
any management letter or other communication sent by the Auditors (or any other
accountants retained by the Borrower) to the Borrower or its management in
relation to the Borrower’s financial, accounting and other systems, management
or accounts, if not provided pursuant to Section 5.03(b)(ii);

(d) Annual Monitoring Report. Within 90 days after the end of each Financial
Year, deliver to IFC the Annual Monitoring Report (i) confirming compliance by
the Borrower and/or the relevant Subsidiary with the social and environmental
covenants set forth in Sections 5.01 (Affirmative Covenants) and 5.02 (Negative
Covenants) and Applicable S&E Law or, as the case may be, identifying any non-
compliance or failure, and the actions being taken to remedy any such
deficiency; and (ii) including such information as IFC shall reasonably require
in order to measure the ongoing development results of the relevant Operations
of the Borrower and any Subsidiary against the indicators specified therein;

(e) Notice of Accidents, Etc. Within 10 days after its occurrence, notify IFC of
any social, labor, health and safety, security or environmental incident,
accident or circumstance having, or which could reasonably be expected to have,
a Material Adverse Effect or material adverse impact on the implementation of
the Transaction, the Project or on carrying on of Operations by the Borrower
and/or any Subsidiary in accordance with the Performance Standards, specifying
in each case the nature of the incident, accident, or circumstance and any
effect resulting or likely to result therefrom, and the measures

 

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the Borrower and/or the relevant Subsidiary is taking or plans to take to
address them and to prevent any future similar event; and keep IFC informed of
the on-going implementation of those measures and plans, in each case, if and to
the extent permitted by applicable law.

(f) Shareholder Matters. Give notice to IFC, concurrently with the Borrower’s
notification to its shareholders, of any board meeting of its directors, such
notice to include the agenda of the meeting; and, as soon as available, deliver
to IFC two copies of:

 

  (i) all notices, reports and other communications of the Borrower to its
shareholders, whether any such communication has been made on an individual
basis or by way of publication in a newspaper or other communication medium; and

 

  (ii) the minutes of all shareholders’ meetings;

(g) Changes to Business; Material Adverse Effect. Promptly notify IFC of any
proposed change in the business or operations of the Borrower or any of its
Subsidiaries and of any event or condition that has had or could reasonably be
expected to have a Material Adverse Effect;

(h) Litigation. Etc. Promptly upon becoming aware of any litigation or
administrative proceedings before any Authority or arbitral body which has or
could reasonably be expected to have, a Material Adverse Effect, notify IFC by
facsimile of that event specifying the nature of that litigation or those
proceedings and the steps the Borrower and/or the relevant Subsidiary is taking
or proposes to take with respect thereto;

(i) Default. Promptly upon the occurrence of an Event of Default or Potential
Event of Default, notify IFC by facsimile specifying the nature of that Event of
Default or Potential Event of Default and any steps the Borrower is taking to
remedy it;

(j) Insurance. Provide to IFC, in a timely manner, the insurance policies and
other information referred to in Section 5.04(d) (Reporting Requirements); and

(k) Other Information. Promptly provide to IFC such other information as IFC
from time to time reasonably requests about the Borrower, any of its
Subsidiaries, their respective assets and Operations and the Project.

Section 5.04. Insurance.

(a) Insurance Requirements and Borrower’s Undertakings. Unless IFC otherwise
agrees, the Borrower shall, and shall cause its Subsidiaries to:

 

  (i) insure and keep insured, with financially sound and reputable insurers,
all their respective assets and businesses in a manner and with amounts and
deductibles as set forth in Annex F and otherwise as required by law;

 

  (ii) punctually pay any premium, commission and any other amounts necessary
for effecting and maintaining in force each insurance policy;

 

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  (iii) promptly notify the relevant insurer of any claim by the Borrower and/or
any Subsidiary under any policy written by that insurer and diligently pursue
that claim;

 

  (iv) comply with all warranties under each policy of insurance;

 

  (v) not do or omit to do, or permit to be done or not done, anything which
might prejudice the Borrower’s and/or any Subsidiaries’, or, where IFC is a loss
payee or an additional named insured, IFC’s right to claim or recover under any
insurance policy; and

 

  (vi) not vary, rescind, terminate, cancel or cause a material change to any
insurance policy;

provided always that if at any time and for any reason any insurance required to
be maintained hereunder shall not be in full force and effect, then IFC shall
thereupon or at any time while the same is continuing be entitled (but have no
such obligation) on its own behalf to procure such insurance at the expense of
the Borrower and to take all such steps to minimize hazard as IFC may consider
expedient or necessary.

(b) Policy Provisions. Each insurance policy required to be obtained pursuant to
this Section shall be on terms and conditions acceptable to IFC, and shall
contain certain provisions to the effect that:

 

  (i) no policy can expire nor can it be canceled or suspended by the Borrower
and/or any Subsidiary or the insurer for any reason (including failure to renew
the policy or to pay the premium or any other amount) unless IFC and, in the
case of expiration or if cancellation or suspension is initiated by the insurer,
the Borrower and/or any Subsidiary receive at least thirty (30) days notice (or
such lesser period as IFC may agree in respect of cancellation, suspension or
termination in the event of war and kindred peril) prior to the effective date
of termination, cancellation or suspension;

 

  (ii) IFC is named as additional named insured on all liability policies;

 

  (iii) where relevant, all its provisions (except those relating to limits of
liability) shall operate as if they were a separate policy covering each insured
party; and

 

  (iv) on every insurance policy on the Borrower and each Subsidiary’s assets
which are the subject of the IFC Security and for business interruption, IFC is
named as loss payee for any claim of, or any series of claims arising with
respect to the same event whose aggregate amount is, the equivalent of one
million Dollars ($1,000,000) or more.

 

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(c) Application of Proceeds

 

  (i) At its discretion, IFC may remit the proceeds of any insurance paid to it
to the Borrower and each Subsidiary to repair or replace the relevant damaged
assets or may apply such proceeds towards any amount payable to IFC under this
Agreement, including to repay or prepay all or any part of the Loan in
accordance with Section 2.06 (Prepayment); provided that there shall be no
minimum amount or notice period or prepayment premium for any such prepayment.

 

  (ii) The Borrower or the relevant Subsidiary shall use any insurance proceeds
it receives (whether from IFC or directly from the insurers) for loss of or
damage to any asset solely to replace or repair that asset.

(d) Reporting Requirements Unless IFC otherwise agrees, the Borrower shall and
shall cause each Subsidiary to provide to IFC the following:

 

  (i) as soon as possible after its occurrence, notice of any event which
entitles the Borrower or the relevant Subsidiary to claim for an aggregate
amount exceeding the equivalent of five hundred thousand Dollars ($500,000)
under any one or more insurance policies;

 

  (ii) within thirty (30) days after any insurance policy is issued to the
Borrower and each Subsidiary, a copy of that policy incorporating any loss payee
provisions or additional named insured provisions required under Section 5.04
(b) (ii) and Section 5.04 (b) (iv) (unless that policy has already been provided
to IFC pursuant to Section 5.01 (i));

 

  (iii) not less than ten (10) days prior to the expiry date of any insurance
policy (or, for insurance with multiple renewal dates, not less than ten
(10) days prior to the expiry date of the policy on the principal asset), a
certificate of renewal from the insurer, insurance broker or agent confirming
the renewal of that policy and the renewal period, the premium, the amounts
insured for each asset or item and any changes in terms or conditions from the
policy’s issue date or last renewal, and confirmation from the insurer that
provisions naming IFC as loss payee or additional named insured, as applicable,
remain in effect;

 

  (iv) such evidence of premium payment as IFC may from time to time request;
and

 

  (v) any other information or documents on each insurance policy as IFC
requests from time to time.

 

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ARTICLE VI

Events of Default

Section 6.01. Acceleration after Default. If any Event of Default occurs and is
continuing (whether it is voluntary or involuntary, or results from operation of
law or otherwise), IFC may, by notice to the Borrower, require the Borrower to
repay the Loan or such part of the Loan as is specified in that notice. On
receipt of any such notice, the Borrower shall immediately repay the Loan (or
that part of the Loan specified in that notice) and pay all interest accrued on
it, and any other amounts then payable under this Agreement and the other IFC
Financing Documents. The Borrower waives any right it might have to further
notice, presentment, demand or protest with respect to that demand for immediate
payment.

Section 6.02. Events of Default. It shall be an Event of Default if:

(a) Failure to Pay Principal or Interest. (i) The Borrower fails to pay when due
any part of the principal of, or interest on, the Loan and such failure
continues for a period of 5 days; or (ii) the Guarantor fails to pay when due
any amounts payable under the Guarantee Agreement and such failure continues for
a period of 5 days;

(b) Failure to Pay Other IFC Loans. The Borrower or any of its Affiliates fails
to pay when due any part of the principal of, or interest on, any loan from IFC
other than the Loan and any such failure continues for the relevant grace period
provided for in the agreement providing for that loan;

(c) Failure to Comply with Obligations. The Borrower fails to comply with any of
its obligations under this Agreement or any other Transaction Document to which
it is a party (other than those referred to in clauses (a) or (b) of this
Section 6.02), and any such failure continues for a period of 30 days after the
date on which IFC notifies the Borrower of that failure;

(d) Failure by Other Parties to Comply with Obligations. Any party to an IFC
Financing Document (other than IFC or DEG) fails to observe or perform any of
its material obligations under that IFC Financing Document (other than those
referred to in clauses (a), (b) or (c) of this Section 6.02), and any such
failure continues for a period of 30 days after the date on which IFC notifies
the Borrower of that failure;

(e) Misrepresentation. Any representation or warranty made in (i) Article III or
in connection with the execution of, or any request (including a request for
Disbursement) under, this Agreement or (ii) any other Transaction Document, by
any of the Borrower, the Guarantor, Beijing United Health One or CHH is
incorrect in any material respect;

(f) Expropriation, Nationalization, Etc. Any Authority condemns, nationalizes,
seizes, or otherwise expropriates all or any substantial part of the assets of
the Borrower, or of the Guarantor of any of their respective share capital, or
assumes custody or control of the assets or of the business or operations of the
Borrower or of the Guarantor or of any of their respective share capital, or
takes any action for the dissolution or disestablishment of the Borrower or of
the Guarantor or any action that would prevent the Borrower or the Guarantor or
their respective officers from carrying on all or a substantial part of their
respective business or Operations;

 

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(g) Involuntary Proceedings. A decree or order by a court is entered against the
Borrower or the Guarantor:

 

  (i) adjudging the Borrower or the Guarantor bankrupt or insolvent;

 

  (ii) approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of, or with respect to, the Borrower or
the Guarantor under any applicable law;

 

  (iii) appointing a receiver, liquidator, assignee, trustee, sequestrator (or
other similar official) of the Borrower or the Guarantor or of any substantial
part of any of their respective property or other assets; or

 

  (iv) ordering the winding up or liquidation of its affairs;

or any petition is filed seeking any of the above and is not dismissed within 30
days;

(h) Voluntary Proceedings. The Borrower or the Guarantor:

 

  (i) requests a moratorium or suspension of payment of Liabilities from any
court;

 

  (ii) institutes proceedings or takes any form of corporate action to be
liquidated, adjudicated bankrupt or insolvent;

 

  (iii) consents to the institution of bankruptcy or insolvency proceedings
against it;

 

  (iv) files a petition or answer or consent seeking reorganization or relief
under any applicable law, or consents to the filing of any such petition or to
the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or
other similar official) of the Borrower or the Guarantor or of any substantial
part of any of their respective property;

 

  (v) makes a general assignment for the benefit of creditors; or

 

  (vi) admits in writing its inability to pay its Liabilities generally as they
become due or otherwise becomes insolvent;

(i) Attachment. An attachment or analogous process is levied or enforced upon or
issued against any of the assets of the Borrower or any of its Subsidiaries or
the Guarantor for an amount in excess of the equivalent of $2,000,000 and is not
discharged within 45 days;

(j) Analogous Events to Bankruptcy. Any other event occurs which under any
applicable law would have an effect analogous to any of those events listed in
Section 6.02(g) through Section 6.02(i);

(k) Cross-Default. (i) The Borrower fails to pay any of its Liabilities that
(together with all other unpaid Liabilities) exceed $500,000 or its equivalent
(other than the Loan or any other loan from IFC to the Borrower) or to perform
any of its obligations under any agreement pursuant to which there is
outstanding any Liability that (together with all other unpaid Liabilities)
exceed $500,000 or its

 

- 43 -

--------------------------------------------------------------------------------

equivalent, and any such failure continues for more than any applicable grace
period or any such Liability becomes prematurely due and payable or is placed on
demand; or (ii) the Guarantor fails to pay any of its Liabilities that (together
with all other unpaid Liabilities) exceed $1,000,000 or its equivalent (other
than the Loan or any other loan from IFC to the Guarantor) or to perform any of
its obligations under any agreement pursuant to which there is outstanding any
Liability that (together with all other unpaid Liabilities) exceed $1,000,000 or
its equivalent, and any such failure continues for more than any applicable
grace period or any such Liability becomes prematurely due and payable or is
placed on demand;

(l) Failure to Maintain Authorizations. Any Authorization (other than
Authorizations that the failure to obtain is not, in the opinion of IFC at any
time, expected to result and does not result in a Material Adverse Effect)
necessary for the Borrower or the Guarantor to perform and observe its
obligations under any Transaction Document, or to carry out the Transaction, the
Project or its Operations, is not obtained when required or is rescinded,
terminated, lapses or otherwise ceases to be in full force and effect, including
with respect to the remittance to IFC or its assignees, in the Loan Currency, of
any amounts payable under any Transaction Document, and is not restored or
reinstated within 30 days of notice by IFC to the Borrower requiring that
restoration or reinstatement;

(m) Revocation, Etc. of Security Documents. Any Security Document or any of its
material provisions:

 

  (i) is revoked, terminated or ceases to be in full force and effect or ceases
to provide the security intended, without, in each case, the prior consent of
IFC;

 

  (ii) becomes unlawful or is declared void; or

 

  (iii) is repudiated and any such repudiation continues for a period of 30 days
during which period such repudiation has no effect;

(n) Revocation Etc. of Transaction Documents. Any Transaction Document (other
than a Security Document) or any of its material provisions:

 

  (i) is revoked, terminated or ceases to be in full force and effect without,
in each case, the prior consent of IFC, and that event, if capable of being
remedied, is not remedied to the satisfaction of IFC within 30 days of IFC’s
notice to the Borrower; or

 

  (ii) becomes unlawful or is declared void; or

 

  (iii) is repudiated and such repudiation is not withdrawn within 30 days of
IFC’s notice to the Borrower requiring that withdrawal; provided that no such
notice shall be required or, as the case may be, the notice period shall
terminate if and when such repudiation becomes effective;

(o) Non-Performance of Project Documents. Any of the Project Documents:

 

  (i) is breached by any party to it and such breach has or could reasonably be
expected to have a Material Adverse Effect; or

 

  (ii) is revoked, terminated or ceases to be in full force and effect without
the prior consent of IFC, or performance of any of the material obligations
under any such agreement becomes unlawful or any such agreement is declared to
be void or is repudiated by any party to it;

 

- 44 -

--------------------------------------------------------------------------------

(p) Judgments. A final judgment, order or arbitral award for the payment of
money in excess of the equivalent of $500,000 is rendered against the Borrower,
any of its Subsidiaries or the Guarantor or any of their respective properties
and that judgment, order or arbitral award continues to be unsatisfied for a
period of 30 consecutive days;

(q) Employee Benefit Plans. Any employee benefit plan of the Borrower or its
Subsidiaries shall at any time fail to satisfy the minimum funding requirement
established by applicable law, and such failure could reasonably be expected to
have a Material Adverse Effect;

(r) Change of Control. A Change of Control shall have occurred.

Section 6.03. Bankruptcy. If the Borrower is liquidated or declared bankrupt,
the Loan, all interest accrued on it and any other amounts payable under this
Agreement will become immediately due and payable without any presentment,
demand, protest or notice of any kind, all of which the Borrower waives.

ARTICLE VII

Miscellaneous

Section 7.01. Saving of Rights.

(a) The rights and remedies of IFC in relation to any misrepresentation or
breach of warranty on the part of the Borrower or any other Person shall not be
prejudiced by any investigation by or on behalf of IFC into the affairs of the
Borrower or any other Person, by the execution or the performance of this
Agreement, any other IFC Financing Document or by any other act or thing which
may be done by or on behalf of IFC in connection with this Agreement, any other
IFC Financing Document and which might prejudice such rights or remedies.

(b) No course of dealing or waiver by IFC in connection with any condition of
Disbursement of the Loan under this Agreement or any other IFC Financing
Document shall impair any right, power or remedy of IFC with respect to any
other condition of Disbursement, or be construed to be a waiver thereof; nor
shall the action of IFC with respect to any Disbursement affect or impair any
right, power or remedy of IFC with respect to any other Disbursement.

(c) Unless otherwise notified to the Borrower by IFC and without prejudice to
the generality of Section 7.01(b), the right of IFC to require compliance with
any condition under this Agreement or any other IFC Financing Document that may
be waived by IFC with respect to any Disbursement is expressly preserved for the
purposes of any subsequent Disbursement.

 

- 45 -

--------------------------------------------------------------------------------

(d) No course of dealing and no failure or delay by IFC in exercising, in whole
or in part, any power, remedy, discretion, authority or other right under this
Agreement, any other IFC Financing Document or any other agreement shall waive
or impair, or be construed to be a waiver of, such or any other power, remedy,
discretion, authority or right under this Agreement or any other IFC Financing
Document, or in any manner preclude its additional or future exercise; nor shall
the action of IFC with respect to any default, or any acquiescence by it
therein, affect or impair any right, power or remedy of IFC with respect to any
other default.

Section 7.02. Notices. Any notice, request or other communication to be given or
made under this Agreement shall be in writing. Subject to Section 5.03(h)
(Litigation, Etc.) and Section 5.03(i) (Default) and Section 7.05 (Enforcement),
any such communication may be delivered by hand, airmail, facsimile or
established courier service to the party’s address specified below or at such
other address as such party notifies to the other party from time to time, and
will be effective upon receipt.

For the Borrower:

Chindex International, Inc.

4340 East West Highway, Suite 1100

Bethesda, Maryland 20814

 

Attention:    Roberta Lipson, CEO    Lawrence Pemble, COO    Robert Low, CFO
Facsimile:    301-215-7719    502-427-0409

With a copy sent by e-mail to the attention of Roberta Lipson, CEO, and Lawrence
Pemble, COO and Robert Low, CFO, at:

E-mail addresses: rlipson@chindex.com; lpemble@chindex.com and
robert.low@chindex.com

For IFC:

International Finance Corporation

2121 Pennsylvania Avenue, N.W.

Washington, D.C. 20433

United States of America

Attention:    Director    Manufacturing, Agribusiness and Services Department
Facsimile:    +1 (202) 974-4872

With a copy (in the case of communications relating to payments) sent to the
attention of the Director, Department of Financial Operations, at:

Facsimile: +1 (202)-522-7419

 

- 46 -

--------------------------------------------------------------------------------

With a copy to:

International Finance Corporation

14th Floor, One Pacific Place

88 Queensway, Admiralty

Hong Kong, SAR, P.R.C

 

Attention:    Director    Manufacturing, Agribusiness and Services Department,
Asia Facsimile:    +852 2509-9363

Section 7.03. English Language.

(a) All documents to be provided or communications to be given or made under
this Agreement or any other IFC Financing Document shall be in the English
language.

(b) To the extent that the original version of any document to be provided, or
communication to be given or made, to IFC under this Agreement or any other IFC
Financing Document is in a language other than English, that document or
communication shall be accompanied by an English translation certified by an
Authorized Representative to be a true and correct translation of the original.
IFC may, if it so requires, obtain an English translation of any document or
communication received in a language other than English at the cost and expense
of the Borrower. IFC may deem any such English translation to be the governing
version between the Borrower and IFC.

Section 7.04. Term of Agreement. This Agreement shall continue in force until
all monies payable under it have been fully paid in accordance with its
provisions.

Section 7.05. Enforcement.

(a) This Agreement shall be governed by and construed in accordance with the
laws of the State of New York, United States of America.

(b) For the exclusive benefit of IFC, the Borrower irrevocably agrees that any
legal action, suit or proceeding arising out of or relating to this Agreement
may be brought in the courts of the United States located in the Southern
District of New York or in the courts of the State of New York located in the
Borough of Manhattan. By the execution of this Agreement, the Borrower
irrevocably submits to the jurisdiction of any such court in any such action,
suit or proceeding. Final judgment against The Borrower in any such action, suit
or proceeding shall be conclusive and may be enforced in any other jurisdiction,
including the Country, by suit on the judgment, a certified or exemplified copy
of which shall be conclusive evidence of the judgment, or in any other manner
provided by law.

(c) Nothing in this Agreement shall affect the right of IFC to commence legal
proceedings or otherwise sue the Borrower in the Country or any other
appropriate jurisdiction, or concurrently in more than one jurisdiction, or to
serve process, pleadings and other legal papers upon the Borrower in any manner
authorized by the laws of any such jurisdiction.

 

- 47 -

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(d) The Borrower hereby irrevocably designates, appoints and empowers Law
Debenture, with offices currently located at 400 Madison Avenue, Suite 4D, New
York, New York 10017, as its authorized agent solely to receive for and on its
behalf service of any summons, complaint or other legal process in any action,
suit or proceeding IFC may bring in the State of New York in respect of this
Agreement.

(e) As long as this Agreement remains in force, the Borrower shall maintain a
duly appointed and authorized agent to receive for and on its behalf service of
any summons, complaint or other legal process in any action, suit or proceeding
IFC may bring in New York, New York, United States of America, with respect to
this Agreement. The Borrower shall keep IFC advised of the identity and location
of such agent.

(f) The Borrower also irrevocably consents, if for any reason its authorized
agent for service of process of summons, complaint and other legal process in
any action, suit or proceeding is not present in New York, New York, to the
service of such papers being made out of the courts of the United States of
America located in the Southern District of New York and the courts of the State
of New York located in the Borough of Manhattan by mailing copies of the papers
by registered United States air mail, postage prepaid, to the Borrower, at its
address specified pursuant to Section 7.02 (Notices). In such a case, IFC shall
also send by facsimile, or have sent by facsimile, a copy of the papers to the
Borrower.

(g) Service in the manner provided in Sections 7.05 (d), (e) and (f) in any
action, suit or proceeding will be deemed personal service, will be accepted by
the Borrower as such and will be valid and binding upon the Borrower for all
purposes of any such action, suit or proceeding.

(h) The Borrower irrevocably waives to the fullest extent permitted by
applicable law:

 

  (i) any objection which it may have now or in the future to the laying of the
venue of any action, suit or proceeding in any court referred to in this
Section;

 

  (ii) any claim that any such action, suit or proceeding has been brought in an
inconvenient forum;

 

  (iii) its right of removal of any matter commenced by IFC in the courts of the
State of New York to any court of the United States of America; and

 

  (iv) any and all rights to demand a trial by jury in any such action, suit or
proceeding brought against such party by IFC.

(i) To the extent that the Borrower may be entitled in any jurisdiction to claim
for itself or its assets immunity in respect of its obligations under this
Agreement or any other IFC Financing Document to which it is a party, from any
suit, execution, attachment (whether provisional or final, in aid of execution,
before judgment or otherwise) or other legal process or to the extent that in
any jurisdiction that immunity (whether or not claimed) may be attributed to it
or its assets, the Borrower irrevocably agrees not to claim and irrevocably
waives such immunity to the fullest extent permitted now or in the future by the
laws of such jurisdiction.

(j) The Borrower hereby acknowledges that IFC shall be entitled under applicable
law, including the provisions of the International Organizations Immunities Act,
to immunity from a trial by jury in any action, suit or proceeding arising out
of or relating to this Agreement or the transactions

 

- 48 -

--------------------------------------------------------------------------------

contemplated hereby brought against IFC in any court of the United States of
America. The Borrower hereby waives any and all rights to demand a trial by jury
in any action, suit or proceeding arising out of or relating to this Agreement
or the transactions contemplated by this Agreement, brought against IFC in any
forum in which IFC is not entitled to immunity from a trial by jury.

(k) To the extent that the Borrower may, in any action, suit or proceeding
brought in any of the courts referred to in Section 7.05 (b) or a court of the
Country or elsewhere arising out of or in connection with this Agreement or any
other IFC Financing Document to which the Borrower is a party, be entitled to
the benefit of any provision of law requiring IFC in such action, suit or
proceeding to post security for the costs of the Borrower, or to post a bond or
to take similar action, The Borrower hereby irrevocably waives such benefit, in
each case to the fullest extent now or in the future permitted under the laws of
the Country or, as the case may be, the jurisdiction in which such court is
located.

Section 7.06. Disclosure of Information.

(a) IFC may disclose any documents or records of, or information about, this
Agreement or any other Transaction Document, or the assets, business, Operations
or affairs of the Borrower to:

 

  (i) its outside counsel, auditors and rating agencies, and

 

  (ii) any other Person as IFC may deem appropriate in connection with any
proposed sale, transfer, assignment or other disposition of IFC’s rights under
this Agreement or any Transaction Document or otherwise for the purpose of
exercising any power, remedy, right, authority, or discretion relevant to this
Agreement or any other Transaction Document.

(b) The Borrower acknowledges and agrees that, notwithstanding the terms of any
other agreement between the Borrower and IFC, a disclosure of information by IFC
in the circumstances contemplated by Section 7.06 (a) does not violate any duty
owed to the Borrower under this Agreement or under any such other agreement.

Section 7.07. Indemnification; No Consequential Damages. (a) The Borrower shall
indemnify IFC and its officers, directors, employees, agents and representatives
(each, an “Indemnitee”) against, and hold each Indemnitee harmless from, any and
all losses, claims, damages, liabilities, and expenses (including fees, charges
and disbursements of counsel) incurred by or asserted against any Indemnitee
arising out of, in connection with, or related to (i) the execution, delivery or
performance of any Transaction Document or any other agreement or instrument
contemplated thereby or the consummation of the Transaction, the Project or any
other transactions contemplated hereby, (ii) the Loan or the use of proceeds
thereof, (iii) non-compliance with any law or regulation, including any
environmental law or regulation, or (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory and regardless of whether
any Indemnitee is party thereto; provided that such indemnity will not be
available to any Indemnitee to the extent that such losses, claims, damages,
liabilities or expenses resulted directly from such Indemnitee’s gross
negligence or willful misconduct as determined by a final judgment of a court of
competent jurisdiction.

(b) To the maximum extent permitted by applicable law, the Borrower shall not
assert, and hereby agrees to waive, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
arising out of, in connection with, or relating to, this Agreement or any
agreement or instrument contemplated hereby, the Loan or the use of the proceeds
thereof.

 

- 49 -

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Section 7.08. Successors and Assignees. This Agreement binds and benefits the
respective successors and assignees of the parties. However, the Borrower may
not assign or delegate any of its rights or obligations under this Agreement
without the prior written consent of IFC.

Section 7.09. Amendments, Waivers and Consents. Any amendment or waiver of, or
any consent given under, any provision of this Agreement shall be in writing
and, in the case of an amendment, signed by the parties.

Section 7.10. Counterparts. This Agreement may be executed in several
counterparts, each of which is an original, but all of which together constitute
one and the same agreement.

IN WITNESS WHEREOF, the parties have caused this Agreement to be signed in their
respective names as of the date first above written.

 

- 50 -

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IN WITNESS WHEREOF, the parties have caused this Agreement to be signed in their
respective names as of the date first above written.

 

BEIJING UNITED FAMILY HOSPITAL CO., LTD. By:   LOGO [g540243ex10_5p56.jpg] Name:
 

 

Roberta Lipson

Title:   Authorized Representative

 

 

 

 

Signature Page to the BUFH-IFC Loan Agreement

--------------------------------------------------------------------------------

INTERNATIONAL FINANCE CORPORATION By:   LOGO [g540243ex10_5p57n.jpg] Name:  

 

Shannon W. Atkeson

Title:   Portfolio Manager, Asia   Manufacturing, Agribusiness and Services
Dept.

 

 

 

 

Signature Page to the BUFH-IFC Loan Agreement

--------------------------------------------------------------------------------

ANNEX A

Page 1 of 1

 

PROJECT COST AND FINANCING PLAN

 

Capital Expenditure

   (million
US$)      %    

Financing

Plan

   (million
US$)      %  

Leasehold Improvement

     20.5         50 %    Debt      18.6         45 % 

New Equipment

     10.5         25 %    China Exim Loan      7.6         18 % 

Asset Transferred from Beijing United Health One

     7.6         18 %    IFC Loan      6         14 % 

Working Capital

     2.8         7 %    DEG Loan      5         12 %          Intercompany
Payable      10.4         25 %          Subordinated Intercompany Payable     
7.6         18 %          Other Intercompany Payable      2.8         7 %       
  Equity      12.4         30 %          Registered Capital      12.4         30
%    

 

 

    

 

 

      

 

 

    

 

 

 

Total

     41.4         100 %    Total      41.4         100 %    

 

 

    

 

 

      

 

 

    

 

 

 

 

- 51 -

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ANNEX B

Page 1 of 4

 

BORROWER/TRANSACTION AUTHORIZATIONS

(See Sections 3.01 (d) and 4.01 (c) of the Loan Agreement)

 

  Section (1) Authorizations Already Obtained

 

  (a) Approval reply (Jing Shang Wu Zi Zi [2010] No. 587) dated July 23, 2010
issued by Beijing Municipal Commission of Commerce (“Beijing MOFCOM”) approving
the incorporation of the Borrower;

 

  (b) Certificate of Approval for Establishment of Enterprises with Investment
of Taiwan, Hong Kong, Macao and Overseas Chinese in the People’s Republic of
China (Shang Wai Zi Jing Zuo Zi [2010] No. 20088) issued by Beijing Municipal
People’s Government on July 27, 2010;

 

  (c) Approval reply (Wei Yi Zheng Han [2012] No. 201) dated May 31, 2012 issued
by the Ministry of Health;

 

  (d) Business License (No. 1281867) of the Borrower issued by Beijing Municipal
Administration of Industry and Commerce (“Beijing SAIC”) on August 23, 2010,
which evidences that the Borrower has passed the annual examination for 2011;

 

  (e) Medical Institution Operation Permit issued by Beijing Municipal Bureau of
Health on December 19, 2011;

 

  (f) State & Local Tax Registration Certificate (Jing Shui Zheng Zi
11010555480297X) dated August 18, 2010;

 

  (g) Foreign Exchange Registration Card of the Borrower;

 

  (h) Customs Registration Certificate of the Borrower dated March 29, 2011
issued by Beijing Customs Service;

 

  (i) Financial Registration For Enterprises With Foreign Investment
(Registration No. 1101058024) issued by the Bureau of Finance of Chaoyang
District of Beijing on September 14, 2010;

 

  (j) Approval Reply for the Report of Environmental Impact of Beijing United
Family Hospital Co., Ltd. (Chao Huan Bao Shen Zi [2011] No. 1176) issued by the
Bureau of Environment Protection of Chaoyang;

--------------------------------------------------------------------------------

ANNEX B

Page 2 of 4

 

  (k) District of Beijing (“Chaoyang Environmental Protection Bureau”) on
November 11, 2011 (the “Environmental Approval”);

 

  (l) Opinion on the Inspection and Acceptance of Fire Protection Facilities in
Construction Project (Chao Gong Yan Xiao [2011] No. 1217) issued by the Fire
Protection Unit of Chaoyang District of Beijing on July 4, 2011; and

 

  (m) Licenses dated July 28, 2010 by Chindex (Beijing) International Trade Co.,
Ltd. of three trademarks to the Borrower.

 

  Section (2) Authorizations to be Obtained Prior to First Disbursement

 

  (a) Unanimous board resolutions of the Borrower:

 

  (i) approving the Borrower to obtain the Loan;

 

  (ii) approving the Borrower to enter into each of the IFC Financing Documents
to which it is a party;

 

  (iii) approving the transactions contemplated by the Equity Pledge;

 

  (iv) approving all of the transactions contemplated by each of the IFC
Financing Documents to which the Borrower is a party;

 

  (v) authorizing a specified Person or Persons to execute the IFC Financing
Documents to which the Borrower is a party on the Borrower’s behalf;

 

  (vi) authorizing a specified Person or persons to issue the Certificate of
Incumbency and Authority; and

 

  (vii) approving or authorizing any other ancillary matters relating to the
Loan and the Equity Pledge, each of the IFC Financing Documents to which the
Borrower is a party or any other agreement or instrument contemplated thereby or
any other transactions contemplated thereby;

--------------------------------------------------------------------------------

ANNEX B

Page 3 of 4

 

  (b) Resolutions of the board of directors of CHH:

 

  (i) approving the terms of, and the transactions contemplated by, the Equity
Pledge and CHH’s execution of the Equity Pledge;

 

  (ii) authorizing a specified Person or Persons to execute the Equity Pledge;
and

 

  (iii) authorizing a specified Person or Persons, on its behalf, to sign and/or
dispatch all documents and notices to be signed and/or dispatched by CHH under
or in connection with the Equity Pledge or to handle any other matters in
connection with the perfection of the Equity Pledge;

 

  (c) Resolutions of the board of directors of the Guarantor:

 

  (i) approving the terms of, and the transactions contemplated by, the IFC
Financing Documents to which the Guarantor is a party and the Guarantor’s
execution of the Guarantee Agreement;

 

  (ii) authorizing a specified Person or Persons to execute the Guarantee
Agreement and a Certificate of Incumbency and Authority on its behalf;

 

  (iii) authorizing a specified Person or Persons, on its behalf, to sign and/or
dispatch all documents and notices to be signed and/or dispatched by the
Guarantor under or in connection with the Guarantee Agreement;

 

  (d) Foreign Debt Registration Certificate and Foreign Debt Registration
Information Form issued by the State Administration of Foreign Exchange, Beijing
Branch (“Beijing SAFE”) evidencing the Loan has been duly registered with
Beijing SAFE;

 

  (e) Written confirmation from Bank of China Corporation, Beijing Branch
(“BOC”) that the Borrower does not need to provide additional security in favor
of BOC as a result of the Borrower’s entry into the Transaction Documents to
which it is a party;

--------------------------------------------------------------------------------

ANNEX B

Page 4 of 4

 

  (f) Consent to the Inspection and Acceptance of the Environmental Protection
Facilities of the Borrower issued by Chaoyang Environmental Protection Bureau as
contemplated by the Environmental Approval; and

 

  (g) Consent of Beijing Electronic Science and Technology Vocational College to
the sublease by Beijing Putian Hotel Management Co., Ltd. of certain hotel rooms
of the Putian Hotel to the Borrower.

 

  Section (3) Authorizations to be Obtained no Later than the Date Falling Nine
(9) Months of the Date of this Agreement

 

  (a) Approval reply issued by Beijing MOFCOM approving the Equity Pledge;

 

  (b) Written notice issued by Beijing SAIC evidencing the creation and
registration of the Equity Pledge with Beijing SAIC; and

 

  (c) Shareholders Register of the Borrower showing that the Equity Pledge has
been duly recorded in it.

--------------------------------------------------------------------------------

ANNEX C

Page 1 of 1

 

INVESTMENTS

None

 

- 56 -

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ANNEX D

Page 1 of 1

 

FINANCIAL DEBT

1. The China Exim Loan Agreement dated July 9, 2012 in the principal amount of
$7,577,307.

2. The Subordinated Financial Debt as set forth on Annex K.

--------------------------------------------------------------------------------

ANNEX E

Page 1 of 1

 

SUBSIDIARIES

None

--------------------------------------------------------------------------------

ANNEX F

Page 1 of 1

 

INSURANCE REQUIREMENTS

(See Section 5.04 (a) of the Loan Agreement)

 

  1. CONSTRUCTION PHASE

a) Erection/Construction All Risks, based on full contract value and including:

 

  i) Strike, Riots & Civil Commotion

 

  ii) Debris Removal

 

  iii) Extra Expenses

 

  iv) Extended Maintenance Period

 

  v) Third Party Liability

b) Marine Cargo (including war)

 

  2. OPERATIONAL PHASE

a) Property All Risks incl. Machinery Breakdown, based on new replacement cost
of assets

b) Business Interruption

c) Third Party Liability

d) Medical Malpractice

e) Professional Indemnity for medical training program (once this commences)

 

  3. AT ALL TIMES

a) All insurances required by applicable laws and regulations.

 

- 59 -

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ANNEX G

Page 1 of 1

 

EXISTING LIENS

RMB28.4 million as cash collateral to Bank of China for the China Exim Loan.

 

- 60 -

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ANNEX H

Page 1 of 2

 

PROHIBITED ACTIVITIES

 

1.

Production or activities involving harmful or exploitative forms of forced
labor1/harmful child labor.2

 

•  

Production or trade in any product or activity deemed illegal under host country
laws or regulations or international conventions and agreements.

 

•  

Production or trade in weapons and munitions.3

 

•  

Production or trade in alcoholic beverages (excluding beer and wine).

 

•  

Production or trade in tobacco

 

•  

Gambling, casinos and equivalent enterprises.

 

•  

Trade in wildlife or wildlife products regulated under Convention on
International Trade in Endangered Species of Wild Fauna and Flora.

 

•  

Production or trade in radioactive materials.4

 

•  

Production or trade in or use of unbonded asbestos fibers.5

 

•  

Commercial logging operations or the purchase of logging equipment for use in
primary tropical moist forest (prohibited by the Forestry policy).6

 

•  

Production or trade in products containing PCBs.7

 

1 

Forced labor means all work or service, not voluntarily performed, that is
extracted from an individual under threat of force or penalty.

2 

Harmful child labor means the employment of children that is economical
exploitive, or is likely to be hazardous to, or to interfere with, the child’s
education, or to be harmful to the child’s health, or physical, mental,
spiritual, moral, or social development.

3 

These activities are prohibited only if a Portfolio Company is substantially
involved in such activities, i.e. the activity is not considered ancillary to
such portfolio Company’s primary operations.

4 

This does not apply to the purchase of medical equipment, quality control
(measurement) equipment and any equipment where IFC considers the radioactive
source to be trivial and/or adequately shielded.

5 

This does not apply to the purchase and use of bonded asbestos cement sheeting
where the asbestos content is <20%.

6 

See IFC OP 4.35, Forestry (under review).

7 

PCBs: Polychlorinated biphenyls – a group of highly toxic chemicals. PCBs are
likely to be found in oil-filled electrical transformers, capacitators and
switchgear dating from 1950-1985. Ozone Depleting Substances (ODSs): Chemical
compounds which react with and deplete ozone, resulting in the widely publicized
‘ozone holes’. The Montreal Protocol lists ODSs and their target reduction and
phase out dates.

--------------------------------------------------------------------------------

ANNEX H

Page 2 of 2

 

•  

Production or trade in pharmaceuticals subject to international phase outs or
bans.

 

•  

Production or trade in pesticides/herbicides subject to international phase out.

 

•  

Production or trade in ozone depleting substances subject to international phase
out.8

 

•  

Drift net fishing in the marine environment using nets in excess of 2.5 km in
length.

 

•  

Knowingly provide or permit to be provided any product or services (or any text,
pictures, graphics, sound, video, or other data in connection with any services)
that:

 

  1. infringe on any third party’s copyright, patent, trademark, trade secret or
other proprietary rights or rights or publicity of privacy;

 

  2. violate any law, statute, ordinance or regulation (including, without
limitation, the laws and regulations governing export control);

 

  3. are defamatory, trade libelous, unlawfully threatening or harassing;

 

  4. are obscene or pornographic or contain child pornography;

 

  5. violate any laws regarding competition, privacy, anti-discrimination or
false advertising; or

 

  6. contain any viruses, Trojan horses, worms, time-bombs, cancel bots or other
computer routines that are intended to damage, detrimentally interfere with,
surreptitiously intercept or expropriate any system, data or personal
information.

 

8 

Ozone Depleting Substances (ODSs): Chemical compounds which react with and
deplete ozone, resulting in the widely publicized ‘ozone holes’. The Montreal
Protocol lists ODSs and their target reduction and phase out dates.

 

- 62 -

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ANNEX I

Page 1 of 3

 

ANTI-CORRUPTION GUIDELINES

FOR IFC TRANSACTIONS

The purpose of these Guidelines is to clarify the meaning of the terms “Corrupt
Practices”, “Fraudulent Practices”, “Coercive Practices,” “Collusive Practices”
and “Obstructive Practices” in the context of IFC operations.

 

1. CORRUPT PRACTICES

A “Corrupt Practice” is the offering, giving, receiving or soliciting, directly
or indirectly, of anything of value to influence improperly the actions of
another party.

INTERPRETATION

 

  A. Corrupt practices are understood as kickbacks and bribery. The conduct in
question must involve the use of improper means (such as bribery) to violate or
derogate a duty owed by the recipient in order for the payor to obtain an undue
advantage or to avoid an obligation. Antitrust, securities and other violations
of law that are not of this nature are excluded from the definition of corrupt
practices.

 

  B. It is acknowledged that foreign investment agreements, concessions and
other types of contracts commonly require investors to make contributions for
bona fide social development purposes or to provide funding for infrastructure
unrelated to the project. Similarly, investors are often required or expected to
make contributions to bona fide local charities. These practices are not viewed
as Corrupt Practices for purposes of these definitions, so long as they are
permitted under local law and fully disclosed in the payor’s books and records.
Similarly, an investor will not be held liable for corrupt or fraudulent
practices committed by entities that administer bona fide social development
funds or charitable contributions.

 

  C. In the context of conduct between private parties, the offering, giving,
receiving or soliciting of corporate hospitality and gifts that are customary by
internationally-accepted industry standards shall not constitute corrupt
practices unless the action violates applicable law.

 

  D. Payment by private sector persons of the reasonable travel and
entertainment expenses of public officials that are consistent with existing
practice under relevant law and international conventions will not be viewed as
Corrupt Practices.

 

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ANNEX I

Page 2 of 3

 

  E. The World Bank Group does not condone facilitation payments. For the
purposes of implementation, the interpretation of “Corrupt Practices” relating
to facilitation payments will take into account relevant law and international
conventions pertaining to corruption.

 

2. FRAUDULENT PRACTICES

A “Fraudulent Practice” is any action or omission, including misrepresentation,
that knowingly or recklessly misleads, or attempts to mislead, a party to obtain
a financial or other benefit or to avoid an obligation.

INTERPRETATION

 

  A. An action, omission, or misrepresentation will be regarded as made
recklessly if it is made with reckless indifference as to whether it is true or
false. Mere inaccuracy in such information, committed through simple negligence,
is not enough to constitute a “Fraudulent Practice” for purposes of World Bank
Group sanctions.

 

  B. Fraudulent Practices are intended to cover actions or omissions that are
directed to or against a World Bank Group entity. It also covers Fraudulent
Practices directed to or against a World Bank Group member country in connection
with the award or implementation of a government contract or concession in a
project financed by the World Bank Group. Frauds on other third parties are not
condoned but are not specifically sanctioned in IFC, MIGA, or PRG operations.
Similarly, other illegal behavior is not condoned, but will not be sanctioned as
a Fraudulent Practice under the World Bank sanctions program as applicable to
IFC, MIGA and PRG operations.

 

3. COERCIVE PRACTICES

A “Coercive Practice” is impairing or harming, or threatening to impair or harm,
directly or indirectly, any party or the property of the party to influence
improperly the actions of a party.

INTERPRETATION

 

  A. Coercive Practices are actions undertaken for the purpose of bid rigging or
in connection with public procurement or government contracting or in
furtherance of a Corrupt Practice or a Fraudulent Practice.

 

  B. Coercive Practices are threatened or actual illegal actions such as
personal injury or abduction, damage to property, or injury to legally
recognizable interests, in order to obtain an undue advantage or to avoid an
obligation. It is not intended to cover hard bargaining, the exercise of legal
or contractual remedies or litigation.

 

- 64 -

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ANNEX I

Page 3 of 3

 

4. COLLUSIVE PRACTICES

A “Collusive Practice” is an arrangement between two or more parties designed to
achieve an improper purpose, including to influence improperly the actions of
another party.

INTERPRETATION

Collusive Practices are actions undertaken for the purpose of bid rigging or in
connection with public procurement or government contracting or in furtherance
of a Corrupt Practice or a Fraudulent Practice.

 

5. OBSTRUCTIVE PRACTICES

An “Obstructive Practice” is (i) deliberately destroying, falsifying, altering
or concealing of evidence material to the investigation or making of false
statements to investigators, in order to materially impede a World Bank Group
investigation into allegations of a corrupt, fraudulent, coercive or collusive
practice, and/or threatening, harassing or intimidating any party to prevent it
from disclosing its knowledge of matters relevant to the investigation or from
pursuing the investigation, or (ii) acts intended to materially impede the
exercise of IFC’s access to contractually required information in connection
with a World Bank Group investigation into allegations of a corrupt, fraudulent,
coercive or collusive practice.

INTERPRETATION

Any action legally or otherwise properly taken by a party to maintain or
preserve its regulatory, legal or constitutional rights such as the
attorney-client privilege, regardless of whether such action had the effect of
impeding an investigation, does not constitute an Obstructive Practice.

GENERAL INTERPRETATION

A person should not be liable for actions taken by unrelated third parties
unless the first party participated in the prohibited act in question.

 

- 65 -

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ANNEX J

Page 1 of 1

 

INTERCOMPANY PAYABLES

 

Payable as of October 31, 2012

   Amount
(RMB)      Amount in
US$     

Settlement Terms

Beijing United Health One

     48,760,241         7,739,721       To be subordinated as required in the
Subordination Agreement

Shanghai United Family Hospital, Downtown Clinic and Beijing United Health One

     69,300,000         11,000,000       Settlement by DEG/IFC Loans

Affiliates

     13,891,213         2,204,954       Insurance Payable of which can be
settled as needed

Beijing United Health One

     17,703,491         2,810,078       Settlement is subject to Section 5.02(z)
of this Agreement

Chindex International, Inc.1

     3,944,913         626,177       Settled by internal cash generation   

 

 

    

 

 

    

Total

     153,599,858         24,380,930         

 

 

    

 

 

    

 

1 

The inclusion of the Service Fees payable to Chindex International, Inc. as of
October 31, 2012 as a line-item in this Annex J of Intercompany Payables has
been added as an accommodation to the parties. For the avoidance of doubt, the
Service Fees are not an Intercompany Payable for purposes of all references and
obligations in the Loan Agreement or any IFC Financing Document.

 

- 66 -

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ANNEX K

Page 1 of 1

 

SUBORDINATED FINANCIAL DEBT

The Subordinated Intercompany Payable

 

- 67 -

--------------------------------------------------------------------------------

ANNEX L

Page 1 of 3

 

Lease Agreements

 

Item

   Description  

Landlord

   Rental/ Year
(RMB)      Area
(m3)  

Office

              Building#1

rental

  Beijing Industrial School of Posts and Telecommunications      5,740,000      
  4,831       Building#2

rental

 

Beijing Radio Instrument No.

2 Factory

     5,800,000         6,305       Pu Tian rental   Beijing Pu Tian Hotel Co.,
Ltd      2,650,980         4,730            ¥ 14,190,980              

 

 

    

Storage Room

              Storage

room/110&210

  Beijing Industrial School of Posts and Telecommunications      45,000        
53       Storage

room/basement

  Beijing Industrial School of Posts and Telecommunications      100,000        
100       Storage room   Beijing Youyi Storage & Transportation Co., Ltd.     
43,800         150            ¥ 188,800              

 

 

    

Dormitory

              Dormitory for
999 staff   Beijing Rongding Investment Co., Ltd.      87,360         22      
Dormitory for
new graduates   Wang Lei      50,400         60            ¥ 137,760           
  

 

 

    

Leasing Equipment Detail

 

Item

   Description   

Vendor

   Rental/Year
(RMB)  

Computer Leasing

      PC LEASE
S042R&S041R    CIT Finance & Leasing Corporation      21,423       PC LEASE
S057    CIT Finance & Leasing Corporation      21,587       PC LEASE
S056    CIT Finance & Leasing Corporation      47,376       PC LEASE
S055    CIT Finance & Leasing Corporation      7,502       PC LEASE
S054    CIT Finance & Leasing Corporation      7,520       PC LEASE
S052&53    CIT Finance & Leasing Corporation      55,986       PC LEASE
S051    CIT Finance & Leasing Corporation      7,523       PC LEASE
S050    CIT Finance & Leasing Corporation      100,690       PC LEASE
S049    CIT Finance & Leasing Corporation      10,862   

 

- 68 -

--------------------------------------------------------------------------------

Leasing Equipment Detail

 

Item

   Description   

Vendor

   Rental/ Year
(RMB)      PC LEASE
S048    CIT Finance & Leasing Corporation      157,102       PC LEASE
S047    CIT Finance & Leasing Corporation      53,097       PC LEASE
S046    CIT Finance & Leasing Corporation      94,202       PC LEASE
S045    CIT Finance & Leasing Corporation      4,704       PC LEASE
S044    CIT Finance & Leasing Corporation      8,900       PC LEASE
S038R    CIT Finance & Leasing Corporation      15,506       PC LEASE
S001    CIT Finance & Leasing Corporation      145,226       PC LEASE
S002    CIT Finance & Leasing Corporation      63,772       PC LEASE
S003    CIT Finance & Leasing Corporation      41,628       PC LEASE
S004    CIT Finance & Leasing Corporation      118,267       PC LEASE
S005&6    CIT Finance & Leasing Corporation      70,807       PC LEASE
S007&8&9    CIT Finance & Leasing Corporation      112,474       PC LEASE
S010&11    CIT Finance & Leasing Corporation      49,332       PC LEASE
S012    CIT Finance & Leasing Corporation      49,696       PC LEASE
S013    CIT Finance & Leasing Corporation      22,162       PC LEASE
S014    CIT Finance & Leasing Corporation      18,064       PC LEASE
S039R&040R    CIT Finance & Leasing Corporation      17,237       PC LEASE
S015    CIT Finance & Leasing Corporation      9,965       PC LEASE
S016    CIT Finance & Leasing Corporation      58,067       PC LEASE
S017    CIT Finance & Leasing Corporation      77,192       PC LEASE
S035R    CIT Finance & Leasing Corporation      103,323       PC LEASE
S018    CIT Finance & Leasing Corporation      72,130       PC LEASE
S019    CIT Finance & Leasing Corporation      58,988       PC LEASE
S020    CIT Finance & Leasing Corporation      32,621       PC LEASE
S021    CIT Finance & Leasing Corporation      11,215       PC LEASE
S022    CIT Finance & Leasing Corporation      33,176             ¥ 1,779,324   
        

 

 

 

 

- 69 -

--------------------------------------------------------------------------------

Printer Leasing

 

  LCL1103041282   

Fuji Xerox

Leasing(China)Limited

     41,400      LCL1110047865   

Fuji Xerox

Leasing(China)Limited

     20,700            ¥ 62,100           

 

 

 

 

- 70 -

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ANNEX M

Page 1 of 1

 

VIE Agreements

1. Shareholder Agreement, dated as of April 21, 2009 between Chindex Healthcare
Holdings Limited and a shareholder of Beijing Access Health Hospital Management
Co., Ltd.

2. Shareholder Agreement, dated as of August 30, 2002 between Chindex (Beijing)
Consulting, Inc. and a shareholder of Beijing United Family Hospital Management
Co., Ltd.

3. Shareholder Agreement, dated as of August 30, 2002 between Chindex (Beijing)
Consulting, Inc. and a shareholder of Beijing United Family Hospital Management
Co., Ltd.

 

- 71 -

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ANNEX N

Page 1 of 3

 

Action Plan

United Family Hospital – IFC review. - 18Dec2012

 

     

Level of the
building

  

Corrective measure

  

Justification

  

Priority

(estimated time frame for

completion)

1    5th floor   

Installation of fire alarm notification devices (vibrating bells), smoke
detection in fifth floor level (dormitory area for Hospital personnel). The
vibrating bells shall be installed in at both ends of the corridor in that floor
and additional one near the main dormitory area (we have estimated three (3)
devices as a minimum quantity) for this area. Provide exit signs as well in this
area.

 

LOGO [g540243ex10_5p79.jpg]

 

[5th floor – dormitories]

   The area designated for employee dormitories and services (bathrooms, etc) is
located in the fifth floor. That space of the building has only one means of
egress and at this time is not provided with fire alarm notification or smoke
detection. The prompt notification of the personnel in that area will permit a
fast reaction for a safe evacuation and also they could perform tasks for the
control of the emergency (assisting patients, controlling the fire, etc).   
February 2013 (2 month).

 

- 72 -

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ANNEX N

Page 2 of 3

 

2    1st floor   

Installation of smoke detection and fire alarm notification in the corridor near
the MRI room and also smoke detection in the MRI control room; for a total of
three (3) smoke detectors and one (1) vibrating bell as a minimum in this area
of the first floor.

 

LOGO [g540243ex10_5p80.jpg]

 

[MRI room]

  

This area of the building is not provided with any fire alarm system or smoke
detection.

  

February 2013 (2 month).

 

- 73 -

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ANNEX N

Page 3 of 3

 

3    Various levels (Doors in Central stair near the elevator lobby)   

Provide fire alarm signal interfacing the security doors located in the central
stair intermediate landings. The lock power of the doors shall be automatically
released at a fire alarm in the building. A fire alarm interface relay shall be
provided at each one of the door lock power controllers for these security doors
in the building.

 

LOGO [g540243ex10_5p81.jpg]

 

{central stair – security doors]

   The client informed that there is a card key located in every floor near the
nurse stations for use of the employees to open these doors in case of fire
emergency; however, this condition is not considered fully appropriate because
during emergencies the means of egress shall be free of obstacles. Note that the
card key to open security doors would be useful for other type of emergencies
under no fire alarm conditions (seismic events, others no related to fire).   
April 2013 (4 month). 4   

Complete

Building

   Installation of automatic fire sprinkler system.    The sprinkler system will
be required to be installed in the building if the building undergoes a “major
renovation” or if any of the floors is subject to renovations (major renovation
would be any modification that will imply the total reconfiguration of spaces,
total modification of the MEP systems, hazmat abatement, etc.)    TBD – future
project

 

- 74 -

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SCHEDULE 1

Page 1 of 3

FORM OF CERTIFICATE OF INCUMBENCY AND AUTHORITY

(See Section 1.01 and Section 4.01(c) of the Loan Agreement)

[Borrower’s/Guarantor’s Letterhead]

[Date]

International Finance Corporation

2121 Pennsylvania Avenue, N.W.

Washington, D.C. 20433

United States of America

Attention: Director,                      Department

Ladies and Gentlemen:

Certificate of Authorized Representative

With reference to the Loan Agreement dated             ,         (the “Loan
Agreement”) between Borrower and IFC, the undersigned [Chairman/Director] of
[name of entity], (the “[insert “Borrower”/“Guarantor” ]”), duly authorized to
do so, hereby certify that:

1. The persons named below have been duly elected, have duly qualified as and at
all times since                  , [—] 1 (to and including the date hereof) have
been officers of [the Borrower/Guarantor], holding the respective offices below
set opposite their names, and the signatures below set opposite their names are
their genuine signatures.

 

1 

Insert a date prior to the time of any corporate action relating to the Loan
Agreement.

 

- 75 -

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SCHEDULE 1

Page 2 of 3

 

Name2

  

Office

  

Signature

 

  

 

  

 

 

  

 

  

 

 

  

 

  

 

Each such person is authorized to sign the IFC Financing Documents and any other
request, notice, certification or other document provided for thereunder and to
take any other action required or permitted to be taken thereunder.

2. Attached hereto as Exhibit A is a copy of the [charter] of [insert entity] as
filed with [name of registry] on [—], together with all amendments thereto
adopted through the date hereof.

3. Attached hereto as Exhibit B is a true and correct copy of
[resolutions/powers of attorney] duly adopted by the Board of Directors of
[entity] (certified by a [    ] notary public) at a meeting on             
    , [—], at which a quorum was present and acting throughout, which
[resolutions/powers of attorney] have not been revoked, modified, amended or
rescinded and are still in full force and effect. Except as attached hereto as
Exhibit B, no [resolutions/powers of attorney] have been adopted by the Board of
Directors of [entity] which deal with the execution, delivery or performance of
any of the IFC Financing Documents.

 

2 

Include name, office and signature of each officer who will sign any Document.
Designations may be changed at any time by issuing a new Certificate of
Incumbency and Authority authorized by the Board of Directors where applicable.

 

- 76 -

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SCHEDULE 1

Page 3 of 3

 

IN WITNESS WHEREOF, I have hereunto set my hand this      day of [—].

 

[Name of Entity]

 

Name: Title:

I, the undersigned, [Secretary/Assistant Secretary] of [entity], DO HEREBY
CERTIFY that [Insert name of Person making the above certifications] is the duly
elected and qualified [Chief Executive Officer/Chief Financial Officer] of
[            ] and the signature above is his genuine signature.

IN WITNESS WHEREOF, I have hereunto set my hand this      day of [—].

 

[Name of Entity]

 

Name: Title:

 

- 77 -

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SCHEDULE 2

Page 1 of 3

 

FORM OF REQUEST FOR DISBURSEMENT (LOAN)

(See Section 2.02 and Section 4.03 of the Loan Agreement)

[Borrower’s Letterhead]

[Date]

International Finance Corporation

2121 Pennsylvania Avenue, N.W.

Washington, D.C. 20433

United States of America

Attention: [Director,                      Department]

Ladies and Gentlemen:

Investment No. 32681

Request for Loan Disbursement No. [    ]*

1. Please refer to the Loan Agreement (the “Loan Agreement”) dated
            ,        , between Beijing United Family Hospital Co., Ltd. (the
“Borrower”) and International Finance Corporation (“IFC”). Terms defined in the
Loan Agreement have their defined meanings whenever used in this request.

2. The Borrower irrevocably requests the disbursement on
                    ,         (or as soon as practicable thereafter) of the
amount of                     under the Loan (the “Disbursement”) in accordance
with the provisions of Section 2.02 of the Loan Agreement. You are requested to
pay such amount to the account in New York of Beijing United Family Hospital
Co., Ltd. [Name of correspondent Bank], Account No.                     at [Name
and Address of Bank] [for further credit to the Borrower’s Account
No.                     at [Name and address of Bank] in [city and country].

 

* Each to be numbered in series.

 

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SCHEDULE 2

Page 2 of 3

 

3. For the purpose of Section 4.02 and Section 4.03 of the Loan Agreement, the
Borrower certifies as follows:

(a) no Event of Default and no Potential Event of Default has occurred and is
continuing;

(b) the proceeds of the Disbursement are at the date of this request needed by
the Borrower for the purpose of the Transaction, or will be needed for such
purpose within 3 months of such date;

(c) since the date of the Loan Agreement nothing has occurred which has or could
reasonably be expected to have a Material Adverse Effect;

(d) since [insert date] [the date of the Loan Agreement]** neither the Borrower
nor any of its Subsidiaries has incurred any material loss or liability (except
such liabilities as may be incurred by the Borrower in accordance with
Section 5.02 of the Loan Agreement);

(e) the representations and warranties made in Article III of the Loan Agreement
are true on the date of this request and will be true on the date of
Disbursement with the same effect as if such representations and warranties had
been made on and as of each such date [(but in the case of Section 3.01(c),
without the words in parenthesis)];

(f) the proceeds of the Disbursement are not in reimbursement of, or to be used
for, expenditures in the territories of any country that is not a member of the
World Bank or for goods produced in or services supplied from any such country;

(g) after giving effect to the Disbursement, neither the Borrower nor any of its
Subsidiaries will be in violation of:

 

  (i) its respective Charter;

 

** The date should be the same as is used in Section 3.01 (h). Use the second
formulation if the Borrower is a start-up company which did not deliver
meaningful financial statements prior to the date of the Loan Agreement.

 

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SCHEDULE 2

Page 3 of 3

 

  (ii) any provision contained in any document to which the Borrower or any
Subsidiary is a party (including the Loan Agreement) or by which the Borrower or
any Subsidiary is bound; or

 

  (iii) any law, rule, regulation, Authorization or agreement or other document
binding on the Borrower or any Subsidiary directly or indirectly, limiting or
otherwise restricting the Borrower’s or any Subsidiary’s borrowing or guarantee
power or authority or its ability to borrow or guarantee; and

(h). (Without limiting the generality of Section 4.02(h)), after giving effect
to the Disbursement, the financial ratios specified in Section 5.01
(n) (Financial Ratios) are met.

The above certifications are effective as of the date of this Request for
Disbursement and shall continue to be effective as of the date of the
Disbursement. If any of these certifications is no longer valid as of or prior
to the date of the requested Disbursement, the Borrower undertakes to
immediately notify IFC.

 

Yours truly, BEIJING UNITED FAMILY HOSPITAL CO., LTD. By  

 

  Authorized Representative

 

Copy to:   Manager, Financial Operations Unit International Finance Corporation

 

- 80 -

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SCHEDULE 3

Page 1 of 1

 

FORM OF LOAN DISBURSEMENT RECEIPT

(See Section 2.02 of the Loan Agreement)

[Borrower’s Letterhead]

International Finance Corporation

2121 Pennsylvania Avenue, N.W.

Washington, D.C. 20433

United States of America

Attention: Manager, Financial Operations Unit

Ladies and Gentlemen:

Investment No. 32681

Disbursement Receipt No. [    ]* (Loan)

We, Beijing United Family Hospital Co., Ltd., hereby acknowledge receipt on the
date hereof, of the sum of                      disbursed to us by International
Finance Corporation (“IFC”) under the Loan of                     provided for
in the Loan Agreement dated             ,          between our company and
International Finance Corporation.** [Of this sum,                     is a Loan
Disbursement.]

 

Yours truly, BEIJING UNITED FAMILY HOSPITAL CO., LTD. By  

 

  Authorized Representative***

 

* To correspond with number of the Disbursement request. Sec Schedule 2.

** Please note that in some jurisdictions one has to be able to prove amounts
disbursed.

*** As named in the Borrower’s Certificate of Authorized Representative (see
Schedule 1).

 

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SCHEDULE 4

Page 1 of 2

 

FORM OF SOLVENCY CERTIFICATE

This Solvency Certificate (the “Certificate”) of Beijing United Family Hospital
Co., Ltd. a company organized and existing under the laws of the People’s
Republic of China (the “Borrower”), is delivered pursuant to Section 4.01(j) of
the Loan Agreement dated as of [                    ] (as the same may be
amended from time to time, the “Loan Agreement”) between the Borrower and IFC.
Unless otherwise defined herein, capitalized terms used in this Certificate
shall have the meanings set forth in the Loan Agreement.

I, [NAME], the duly elected, qualified and acting [TITLE] of the Borrower, DO
HEREBY CERTIFY as follows:

1. I have carefully reviewed the Loan Agreement and the other IFC Financing
Documents and such other documents as I have deemed relevant and the contents of
this Certificate and, in connection herewith, have made such investigation, as I
have deemed necessary therefore. I further certify that the financial
information and assumptions which underlie and form the basis for the
representations made in this Certificate were reasonable when made and were made
in good faith and continue to be reasonable as of the date hereof.

2. I have reviewed all financial information delivered to IFC pursuant to
Articles III and IV of the Loan Agreement (the “Information”). I am familiar
with the financial performance and prospects of the Borrower and hereby confirm
that the Information was prepared in good faith and fairly presents the
Borrower’s consolidated financial condition, based on the information available
to the Borrower at the time so furnished.

3. As of the date hereof, after giving effect to the transactions contemplated
by the Transaction Documents (other than the Intercreditor and Security Sharing
Agreement), the fair value (as defined herein) and the present fair salable
value (as defined herein) of any and all property of the Borrower is greater
than the probable liability on existing debts (as defined herein) of the
Borrower as they become absolute and matured.

4. As of the date hereof, after giving effect to the transactions contemplated
by the Transaction Documents (other than the Intercreditor and Security Sharing
Agreement), the Borrower is able to pay its debts (including, without
limitation, contingent and subordinated liabilities) as they become absolute and
mature (as defined herein).

 

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SCHEDULE 4

Page 2 of 2

 

5. The Borrower does not intend to, nor believes that it will, incur debts that
would be beyond its ability to pay as such debts mature.

6. As of the date hereof, after giving effect to the transactions contemplated
by the Transaction Documents (other than the Intercreditor and Security Sharing
Agreement), the Borrower is not engaged in businesses or transactions, nor about
to engage in businesses or transactions, for which any property remaining would
constitute unreasonably small capital after giving due consideration to the
prevailing practice in the industry in which it is engaged.

7. The Borrower does not intend, in consummating the transactions contemplated
by the Transaction Documents (other than the Intercreditor and Security Sharing
Agreement), to hinder, delay or defraud either present or future lenders or any
other Person to which the Borrower is or will become, on or after the date
hereof, indebted.

8. For purposes of this Certificate, “fair value” means the amount at which the
aggregate assets of the Borrower would change hands between a willing buyer and
a willing seller within a commercially reasonable period of time, each having
reasonable knowledge of the relevant facts, neither being under any compulsion
to act, with equity to both. “Present fair saleable value” means the amount that
may be realized if the aggregate assets of the Borrower are sold with reasonable
promptness in an arm’s length transaction under present conditions for the sale
of assets of comparable business enterprises. The term “debt” means any legal
liability, including, without limitation, any contingent, subordinated,
absolute, fixed, matured or unmatured, disputed or undisputed, secured or
unsecured and liquidated or unliquidated liability. Being “able to pay its debts
as they become absolute and mature” means that, assuming transactions
contemplated by the Transaction Documents (other than the Intercreditor and
Security Sharing Agreement) have been consummated as proposed and based only
upon the [Borrower’s] financial forecasts, the Borrower would have positive cash
flow for the period covered by such forecasts after paying its scheduled
anticipated indebtedness and current liabilities, including (and after giving
effect to) the scheduled principal payments with respect to the Loan under the
Loan Agreement as in effect on the date hereof.

IN WITNESS WHEREOF, I have executed this Certificate this [DATE]

 

By:  

 

  Name:   Title:

 

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SCHEDULE 5

Page 1 of 2

 

FORM OF SERVICE OF PROCESS LETTER

[Process Agent’s Letterhead]

(See Section 4.01 (k) of the Loan Agreement)

[Date]

International Finance Corporation

2121 Pennsylvania Avenue, N.W.

Washington, D.C. 20433

Attention:                                         

[Country/                     ]

Re:

Dear Sirs:

Reference is made to [(i)] Section     of the Loan Agreement
dated                     (the “Loan Agreement”) between Beijing United Family
Hospital Co., Ltd. (the “Borrower”) and International Finance Corporation
(“IFC”). Unless otherwise defined herein, capitalized terms used herein shall
have the meaning specified in the Loan Agreement.

Pursuant to Section 7.05 (d) of the Loan Agreement, the Borrower has irrevocably
designated and appointed the undersigned, Law Debenture, with offices currently
located at 400 Madison Avenue, Suite 4D, New York, New York 10017, as its
authorized agent to receive for and on its behalf service of process in any
legal action or proceeding with respect to the Loan Agreement in the courts of
the United States of America for the Southern District of New York or in the
courts of the State of New York located in the Borough of Manhattan.

The undersigned hereby informs you that it has irrevocably accepted that
appointment as process agent as set forth in Section 7.05 (d) of the Loan
Agreement and agrees with you that the undersigned (i) shall inform IFC promptly
in writing of any change of its address in New York, (ii) shall perform its
obligations as such process agent in accordance with the relevant provisions of
Section 7.05 of the Loan Agreement, and (iii) shall forward promptly to the
Borrower any legal process received by the undersigned in its capacity as
process agent.

As process agent, the undersigned and its successor or successors agree to
discharge the above- mentioned obligations and will not refuse fulfillment of
such obligations as provided under any of Section 7.05 of the Loan Agreement.

 

Very truly yours, Law Debenture By  

 

Title:  

 

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SCHEDULE 5

Page 2 of 2

 

cc: Beijing United Family Hospital Co., Ltd.

 

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SCHEDULE 6

Page 1 of 2

 

FORM OF LETTER TO BORROWER’S AUDITORS

(See Section 4.01 (i) and Section 5.01(f) of

the Loan Agreement)

[Borrower’s Letterhead]

[Date]

[NAME OF AUDITORS]

[ADDRESS]

Ladies and Gentlemen:

We hereby authorize and request you to give to International Finance Corporation
of 2121 Pennsylvania Avenue, N.W., Washington, D.C. 20433, United States of
America (“IFC”), all such information as IFC may reasonably request with regard
to the financial statements of the undersigned company, both audited and
unaudited. We have agreed to supply that information and those statements under
the terms of a Loan Agreement between the undersigned company and IFC dated
            ,         (the “Loan Agreement”). For your information we enclose a
copy of the Loan Agreement.

We authorize and request you to send two copies of the audited accounts of the
undersigned companies to IFC to enable us to satisfy our obligation to IFC under
Section 5.03(b)(i) of the Loan Agreement. When submitting the same to IFC,
please also send, at the same time, a copy of your full report on such accounts
in a form reasonably acceptable to IFC.

 

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SCHEDULE 6

Page 2 of 2

 

Please note that under Section 5.03(b)(ii) and (iii) and Section 5.03(c) of the
Loan Agreement, we are obliged to provide IFC with:

(a) a copy of the annual and any other management letter or other communication
from you to the undersigned companies or its respective management commenting
on, among other things, the adequacy of the undersigned companies’ financial
control procedures and accounting and management information system; and

(b) a report by you certifying that, based upon its audited financial
statements, each of the undersigned companies was in compliance with the
financial covenants contained in Section 5.02 of the Loan Agreement as at the
end of the relevant Financial Year or, as the case may be, detailing any non-
compliance.

Please also submit each such communication and report to IFC with the audited
accounts.

For our records, please ensure that you send to us a copy of every letter that
you receive from IFC immediately upon receipt and a copy of each reply made by
you immediately upon the issue of that reply.

 

Yours truly, BEIJING UNITED FAMILY HOSPITAL CO., LTD. By  

 

  Authorized Representative

Enclosure

 

cc: Director

[Name of Department]

International Finance Corporation

2121 Pennsylvania Avenue, N.W.

Washington, D.C. 20433

United States of America

 

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SCHEDULE 7

Page 1 of 2

 

FORM OF BORROWER’S CERTIFICATION

ON DISTRIBUTION OF DIVIDENDS

(See Section 5.02(a) of the Loan Agreement)

[Borrower’s Letterhead]

 

International Finance Corporation

2121 Pennsylvania Avenue, N.W.

Washington, D.C. 20433

Attention:                                         

[Country/                     ]

  [Date]

Re:

Dear Sirs:

1. Please refer to the Loan Agreement (the “Loan Agreement”) dated
            ,         between Beijing United Family Hospital Co., Ltd. (the
“Borrower”) and International Finance Corporation (“IFC”). Terms defined in the
Loan Agreement have their defined meanings whenever used in this request.

2. This is to inform you that the Borrower plans a distribution of dividends to
its shareholders in the aggregate amount of                     , such
distribution to commence on or about             ,         . Pursuant to
Section 5.02 (a) of the Loan Agreement, the Borrower hereby certifies that, as
at the date hereof:

 

  (a) the proposed distribution will be entirely out of retained earnings and
such retained earnings do not include any amount resulting from the revaluation
of any of the Borrower’s assets;

 

  (b) no Event of Default or Potential Event of Default has occurred and is
continuing;

 

  (c) the Borrower is in compliance with all financial ratios that shall be
applicable for the year 2015 and thereafter as set forth in Section 5.01(n)
(Financial Ratios) on a Pro Forma Basis;

 

  (d) the Borrower delivers to IFC a certification substantially in the form of
Schedule 7.

 

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SCHEDULE 7

Page 2 of 2

 

3. The Borrower undertakes not give effect to the proposed distribution or any
part thereof if, at the time of so doing or after giving effect to it, the
Borrower could not certify the matters referred to in section 2 of this
certification.

 

Yours truly, BEIJING UNITED FAMILY HOSPITAL CO., LTD. By  

 

  Authorized Representative

 

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SCHEDULE 8

Page 1 of 3

 

INFORMATION TO BE INCLUDED IN

QUARTERLY AND ANNUAL REVIEW OF OPERATIONS

(See Sections 5.03(a)(ii) and (b)(iv) of the Loan Agreement)

 

  (1) Sponsors and Shareholdings. Information on significant changes in share
ownership of the Borrowers, the reasons for such changes, and the identity of
major new shareholders.

 

  (2) Country Conditions and Government Policy. Report on any material changes
in local conditions, including government policy changes, that directly affect
the Borrowers (e.g. changes in government economic strategy, health sector
policy, taxation, foreign exchange availability, price controls, and other areas
of regulations.)

 

  (3) Management and Technology. Information on significant changes in (i) the
Borrower’s senior management or organizational structure, and (ii) technology
used by the Borrowers, including technical assistance arrangements.

 

  (4) Corporate Strategy. Description of any changes to the Borrowers’ corporate
or operational strategy, including changes in service profile, degree of
integration, and business emphasis.

 

  (5) Markets. Brief analysis of changes in the Borrowers’ market conditions
(both primary and secondary), with emphasis on changes in reimbursement
structure, market share and degree of competition.

 

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(6) Operating Performance. Discussion of the following operating indicators by
Chindex on a consolidated basis and on a year-on-year basis, MPD, BUFH business
by markets, eg, Shanghai, Beijing and Guangzhou, etc.

 

1. Financial Information to be Provided on a Quarterly Basis (Including Previous
Quarter for Comparison)

    

2. Indicator

     [     ]Q2[    ]      [     ]Q2[    ] 

OPERATIONAL:

    

Outpatient visits per day

    

Inpatient Admissions

    

Inpatient Days

    

Beds in Service

    

Occupancy Rate

    

ALOS

    

Number of Physicians

    

Number of Nurses

    

Number of Employees

    

Revenue/Inpatient Day (Admission)

    

Revenue/Outpatient Visit

    

Section 1.02 FINANCIAL

    

Revenue

    

EBITDA

    

SWB as a % of Revenue

    

Net Profit

    

Current Assets

    

Total Assets

    

Current Liabilities

    

Total Liabilities

    

Short Term Debt

    

Long Term Debt

    

Change in Working Capital

    

A/R Days

    

Inventory Days

    

A/P Days

    

Total Operating Cash Flow

    

Capex (both maintenance and discretionary)

    

 

  (7) Financial Condition. Key financial ratios for previous year, compared with
ratios covenanted in the Loan Agreement.

 

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  (8) Development Impact Report: An annual report for each hospital and clinic
project within 120 days of the financial year including:

 

  a. EBITDA for the past 12 months;

 

  b. Taxes paid to the government (both business taxes and income taxes) for the
past 12 months;

 

  c. Number of employees;

 

  d. Number of female employees;

 

  e. Number of outpatients served;

 

  f. Number of inpatients treated;

 

  g. Number of staff trained;

 

  h. Cost of training provided to staff for the past 12 months (both an average
per staff member and an aggregate amount); and

 

  i. Value of free or discounted treatment provided to patients for the past.

]

 

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SCHEDULE 9

INTERNATIONAL FINANCE CORPORATION

Environmental and Social Performance

Annual Monitoring Report (AMR)

 

LOGO [g540243ex10_5p100.jpg]

 

 

 

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INTERNATIONAL FINANCE CORPORATION

ENVIRONMENTAL AND SOCIAL PERFORMANCE

ANNUAL MONITORING REPORT (AMR)

LOGO [g540243ex10_5p101a.jpg]

Beijing United Family Hospital Co., Ltd.

People’s Republic of China

32681

REPORTING PERIOD: (insert date) through (insert date)

AMR COMPLETION DATE: (    )

 

LOGO [g540243ex10_5p101b.jpg]

Environment and Social Development Department

2121 Pennsylvania Avenue, NW

Washington, DC 20433 USA

www.ifc.org/enviro

 

- 94 -

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a) Introduction

 

The Annual Monitoring Report

IFC’s Investment Agreement requires Beijing United Family Hospital Co., Ltd.
(BUFH) to prepare an Annual Monitoring Report (AMR) for all its facilities and
operations. This document comprises IFC’s preferred format for environmental and
social performance reporting. The AMR informs the Environment and Social
Development Department about the environmental and social state of the
investment. It should be noted that it asks for summary information and on the
basis of this information IFC may request additional, more detailed explanations
and data.

 

(1) Preparation Instructions

 

The following points should assist you in completing this form. Please be
descriptive in your responses and attach additional information as needed.

 

  •  

IFC’s Investment Agreement requires designated BUFH personnel to complete and
submit annual environmental and social monitoring reports in compliance with the
schedule stipulated in the Investment agreement.

 

  •  

BUFH must report qualitative and quantitative project performance data each year
of the investment for the environmental and social monitoring parameters
included in this report format.

 

  •  

The main purpose of completing this form is to provide the following
information:

 

  1. Environmental and Social Management

 

  2. Occupational Health and Safety (OHS) Performance

 

  3. Significant Environmental and Social Events

 

  4. General Information and Feedback

 

  5. Sustainability of Project and Associated Operations

 

  6. Compliance with World Bank Group and local environmental requirements as
specified in the Investment Agreement

 

  7. Compliance with World Bank Group and local social requirements as specified
in the Investment Agreement

 

  8. Data Interpretation and Corrective Measures

 

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(a) Specialist Contact Information

 

If you have any questions regarding the AMR or wish to discuss completion of the
AMR please contact the following Investment Officer or Portfolio Manager.

 

Investment    Name: [insert name]    Portfolio    Name: [insert name] Officer   
Telephone Number: [—]    Manager    Telephone Number: [—]    Facsimile Number:
[—]       Facsimile Number: [—]    Email: [insert email address]       Email:
[insert email address]

B) ENVIRONMENTAL AND SOCIAL MANAGEMENT

1.1 AMR Preparer

 

 

To be completed by BUFH    Name: [insert name] authorized representative   
Title: [—]    Telephone Number: [—]    Facsimile Number: [—]    Email: [insert
email address] BUFH Information    BUFH office physical address:    Address:
Beijing United Family Hospital and Clinics, 2 Jiang Tai Lu, Chaoyang District,
Beijing, PRC 100016    BUFH web page address: www.unitedfamilyhospitals.com

I certify that the data contained in this AMR completely and accurately
represents BUFH’s operations during this reporting period. I further certify
that analytical data summaries1 incorporated in Section 6 are based upon data
collected and analyzed in a manner consistent with the World Bank Group’s
Pollution Prevention and Abatement Handbook, Monitoring.2

 

1  Raw analytical data upon which summaries are based should not be submitted
with this AMR but must be preserved by BUFH and presented to IFC upon demand.

2  Pollution Prevention and Abatement Handbook

 

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—ELECTRONIC SIGNATURE—      BUFH Employee Name    Signature

1.2 Environmental Responsibility Chart

 

Please name the individuals in the company who hold responsibility for
environmental and social performance (e.g. Environment Manager, Occupational
Health and Safety Manager, Community Relations Manager) and give their contact
information (Name, Address, Telephone Number, Fax Number, E-mail Address).

1.3 Summary of Current Operations

 

Describe company operations and level of business activity.

 

Hospital/clinic name

  

No of staff

  

No of contractors

  

Floor space

  

No of beds

  

Date of JCIA certification

                                                                                
        

Describe any significant changes since the last report in the company or in
day-to-day operations that may affect environmental and social performance. In
particular, please identify any changes in fuel/power supply that would
necessitate independent air quality monitoring.

 

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2 Occupational Health and Safety Performance

 

List any incidents and accidents (describing any fatalities, non-fatal injuries,
lost work days, and vehicle collisions) in the reporting period:

 

3 Life and Fire Safety

 

 

2.1. Please complete the following table for BJUH.

 

BUFH Fire Safety Verification
Activities

  

Mandatory Frequency

  

Date(s) Performed

  

Observed Deficiencies3

  

Corrective Actions and

Schedule For
Implementation4

Fire Drills    Minimum: three (3)/year          Inspect and certify fire
detection and suppression electrical and mechanical systems.    Minimum:
one (1)/year          Inspect, refill/recharge portable fire extinguisher   
Minimum: two (2) inspections/year         

 

2.2. Please complete the following table for Beijing Rehab Center.

 

BUFH Fire Safety Verification
Activities

  

Mandatory Frequency

  

Date(s) Performed

  

Observed Deficiencies5

  

Corrective Actions and

Schedule For
Implementation6

Fire Drills    Minimum: three (3)/year         

 

3 

Attach additional sheets as needed to fully describe observed deficiencies.

4  Attach additional sheets as needed to fully describe corrective actions and
implementation.

5  Attach additional sheets as needed to fully describe observed deficiencies.

6  Attach additional sheets as needed to fully describe corrective actions and
implementation.

 

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BUFH Fire Safety Verification
Activities

  

Mandatory Frequency

  

Date(s) Performed

  

Observed Deficiencies5

  

Corrective Actions and
Schedule For
Implementation6

Inspect and certify fire detection and suppression electrical and mechanical
systems.    Minimum: one (1)/year          Inspect, refill/recharge portable
fire extinguisher    Minimum: two (2) inspections/year         

 

3 IFC/WBG Environmental Policies and Guidelines and Host Country Regulations
Compliance

 

3.1 Effluent monitoring

Please append effluent monitoring results for all BUFH hospitals and clinics.
Where there is any non- compliance with WBG EHS Guidelines or local regulatory
limit please explain the reason.

 

Parameters

  

Sample Collection

and Analysis

Frequency

  

WBG/IFC Maximum

Levels
(WBG/IFC Units)

pH

   Yearly    6-9   

Biochemical oxygen demand (BOD5)

   Yearly    50    mg/l

Chemical oxygen demand (COD)

   Yearly    250    mg/l

Oil and grease

   Yearly    10    mg/l

Total suspended solids (TSS)

   Yearly    50    mg/l

Total coliform bacteria, Most Probable Number (MPN) or plate count (PC)

   Yearly    ¨400    Per 100ml

Temperature increase

   Yearly    ¨3°C   

3.2 Emissions monitoring

Please append emission monitoring results for all BUFH hospitals and clinics.

3.3 Compliance Issues

List any regulatory issues and non-compliances (including fire safety, waste
management, effluent management, emissions, etc) in the reporting period:

 

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4 Community Engagement

 

Please describe any interaction with communities neighboring BUFH hospitals and
clinics, including any complaints made and how they were managed

 

- 100 -