EX-10.12






Exhibit 10.12




CONFIDENTIAL TREATMENT REQUESTED BY CONCORD MEDICAL SERVICES HOLDINGS LIMITED




REDACTED Version of Exhibit 10.12

Translation



CERTAIN INFORMATION (INDICATED BY ASTERISKS) IN THIS EXHIBIT HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED
WITH RESPECT TO THE OMITTED PORTION.




Supplemental Agreement

Concerning the Development of

the Aohai Radiotherapy Treatment and Diagnosis Research Center




Contract Number:

Time of Execution:

Place of Execution:




Section I General Provisions



In accordance with applicable PRC laws and regulations, through friendly negotiations and on the
basis of the principle of equality and mutual benefit, Chinese People’s Liberation Army Navy
General Hospital and Shenzhen Aohua Medical Services Co., Ltd. entered into a cooperation contract
on September 15, 1995 whereby they decided to establish Aohai Radiotherapy Treatment and Diagnosis
Research Center (the “Center”) at Chinese Peoples’ Liberation Army Navy General Hospital in
Beijing. The OUR-XGD type rotating focalizing gamma knife (“Head Gamma Knife”), as initially
invested, has been put into formal medical treatment operation as of October 30, 1996 and, thanks
to the Parties’ joint efforts, the Center has achieved good social and economic effect. The Parties
are willing to increase their contribution in respect of the equipment of the Center on the basis
of their existing original cooperation and hereby enter into this supplementary contract.




Section II Parties of Cooperation




Article 1 Parties of Cooperation

Party A: Chinese People’s Liberation Army Navy General Hospital

Address: No. 6 Fucheng Rd, Beijing Postal Code: 100037

Tel: 010-68587733 Fax: 010-68581507

Legal Representative: Ye Yang

Title: President




Party B: Shenzhen Aohua Medical Services Co., Ltd.

Address: Floor 17, Guomao Plaza, Renmin South Road, Shenzhen Postal Code: 518014

Tel: 0755-2255708 Fax: 0755-2251690

Legal Representative: Jun Song

Title: President




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CONFIDENTIAL TREATMENT REQUESTED BY CONCORD MEDICAL SERVICES HOLDINGS LIMITED




Section III Purpose of Cooperation and Scope of Application



Article 2 Purpose of Cooperation. Based on the OUR-XGB rotating focalizing gamma knife (Head Gamma
Knife), as invested in the initial phrase, the Parties intend to make the second equipment
investments by deploying the world’s first stereoscopic-directional gamma ray whole-body therapy
system (Body Gamma Knife), and proactively carry out research and teaching work at the hospital and
thereby constantly enhance therapy performance and develop the Center into a top modernized
medical treatment organization of China that integrates R&D, teaching and therapy work.



Article 3 Scope of Application. The Center will mainly be focused on offering the whole-body
therapy for tumor diseases.




Section IV Term of Cooperation



Article 4 The term of cooperation for the second phase equipment contributed shall be 20 years,
commencing from the date on which the treatment and operation formally begin upon approval by
relevant authorities.




Section V Contribution and Profit Allocation of the Parties




Article 5 Second Phase Equipment Contribution and Profit Allocation



1 Party B shall contribute the second phase equipment, i.e. the stereoscopic-directional gamma ray
whole body therapy system (Body Gamma Knife), which is valued at RMB*** million. Party A shall
contribute the medical personnel and facility room/s required for the second phase equipment as
well as the office premises related to such project. Other supporting facilities (air conditioning,
dehumidifiers, and telephones), etc. shall be treated as joint contribution of the Parties.



2 Profit Allocation



All profits derived from the contribution of this phase shall, after deducting all costs (as set
forth under Article 6 of the original Contract), be allocated according to the following
percentages, on the basis of which the Parties shall also enjoy the title to, bear the risk of, and
have other rights to, the assets of the Center:




	 	 	 	 	 	 	 	 
	 	 	 	Party A	 	 	Party B	 
	 	Year ***
	 	***	 	 	***	 
	 	Year ***
	 	***	 	 	***	 
	 	Year ***
	 	***	 	 	***	 






Section VI Disposal of Assets During and

Upon Expiry of the Term of Cooperation




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CONFIDENTIAL TREATMENT REQUESTED BY CONCORD MEDICAL SERVICES HOLDINGS LIMITED



Article 6 During the term of cooperation, any transfer by a Party of all or part of its interests
in the Center to a third party shall be subject to the approval of the other Party, which shall
have the preemptive right of purchase under equal conditions.



Article 7 During the term of cooperation, the Parties shall be entitled to the ownership interests
in the forgoing contributed assets according to the relevant provision hereof on such contribution.
The Parties shall be entitled to the ownership interests in the assets in accordance with the
percentages set out in Clause 2, Article 5 hereof in respect of assets acquired in the name of the
Center. Upon the expiry of the term of cooperation, all assets and earnings of the Center shall
belong to the Center and the profits shall no longer be shared between the Parties.




Section VII Responsibilities of the Parties



Article 8 Party A and Party B shall each be responsible for fulfilling their respective
responsibilities below:



Party A’s Responsibilities:





	 	1.	 	To handle project approval procedures with relevant authorities and secure approvals
in respect of the project of the Center proposed under the current phase;
	 
	 	2.	 	To obtain all necessary qualification permits in line with applicable laws and
regulations of the state;
	 
	 	3.	 	To make contributions in line with Article 5(1) hereof;
	 
	 	4.	 	To provide the premises required for the whole-body gamma knife system (equipment
room, operating room, preparation room and office);
	 
	 	5.	 	To put in place water and power utilities of the Center;

	 
	 	6.	 	To work with Party B on the organization layout and construction plan;
	 
	 	7.	 	To administer matters relating to the affiliations of the Center’s staff with the CCP
or other politics parties, the Labor Union and the Communist Youth League and medical
affairs under the centralized administration of the Hospital;
	 
	 	8.	 	To supervise the medical quality of the Center and in accordance with regulations and
rules, to submit disputes with the board of directors, which shall have the power to
consider and decide the settlements and resolutions of such disputes; and
	 
	 	9.	 	Other matters mandated by the Center




Party B’s Responsibilities:





	 	1.	 	To make contributions in line with Article 5(1) hereof;
	 
	 	2.	 	To work with Party A to determine the management model and daily management work of
the Center;
	 
	 	3.	 	To work with Party A to engage top domestic and foreign experts and senior
technicians; and
	 
	 	4.	 	Other matters mandated by the Center.





Section VIII Board of Directors and Management Body




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CONFIDENTIAL TREATMENT REQUESTED BY CONCORD MEDICAL SERVICES HOLDINGS LIMITED



Article 9 The duties and powers of the board of directors shall in principle be dealt with in
compliance with the original contract. The composition of the board of directors will be adjusted
appropriately based on the specific circumstances of the project.



Article 10 The management body shall put into place centralized administration and HR, accounting
and marketing organization management personnel and shall account for its finances independently.
The aforesaid organization setting-up and personnel arrangement matters shall be subject to the
consideration and decision of the board.




Section IX Other Matters



Article 11 Any matter not addressed herein shall be implemented in line with the original contract.




Section X Effectiveness and Miscellaneous



Article 12 This Contract will become effective immediately upon execution by the legal or
authorized representatives of the Parties.



Article 13 This Contract shall be executed in six originals, with each Party holding three copies,
each of which shall have the same force and effect.




	 	 	 
	Party A: Chinese People’s Liberation

	 	Party B: Shenzhen Aohua Medical
	Army Navy General Hospital

	 	Services Co., Ltd.
	Authorized Representative:

	 	Authorized Representative:
	 
	 	 
	(Official stamp)

	 	(Official stamp)
	 
	 	 
	(affixed with the seal of The
Chinese People’s Liberation Army
Navy General Hospital and the
signature of Yunyou Duan)

	 	(affixed with the seal of Shenzhen
Aohua Medical Services Co., Ltd. and
the signature of Jun Song)
	 
	 	 
	March 18, 1999

	 	March 18, 1999






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