[Abstract]

Since 2018, our lawyers have provided legal services for the property right transfer of a data center project (hereinafter referred to as "the project"), and deeply participated in the design of transaction mode and the production of transaction text.

[Key words] customized construction asset transfer

[Project information]

The client of this project is a registration, trusteeship and settlement institution. Due to the increasing demand for background data center resources due to its business development, as a financial institution, its information security level protection and data center need to reach higher standards, so it is necessary to customize the data center room.

The data technology R & D center of an Industrial Park held by the seller of this project covers an area of nearly 140000 square meters, and about 50000 sets of cabinets can be provided after the completion of many buildings. As the data center exclusively provides large-scale, high-quality, safe and reliable professional services as well as related value-added services for Internet content providers, governments, financial institutions and large state-owned enterprises, the client intends to purchase one of them and customize it as a data center that meets the requirements.

[Difficulty or novelty of the project]

The difficulty of this project lies in:

First, when our lawyers intervened, the transaction mode, transaction conditions and core content of the project were not determined, and in the process of drafting the asset transfer contract, both parties changed the cooperation mode for many times, which brought great difficulties to the drafting of transaction documents.

Second, before the beginning of this transaction, the client's due diligence on the seller was not detailed, which led to the lawyer's inability to design risk prevention clauses.

Third, there are more than 100 cases involving the seller. In the process of drafting the transaction documents, it is found that the seller is listed as the person who has been executed for breach of trust, and its potential debt risk is high, and its assets are subject to the risk of being sealed up.

[Lawyer response]

First, fully consider the client's needs.

After communication with the client, the client does not pay attention to the time of obtaining the property right of the data center, but pays more attention to whether the data center meets the standard requirements. Therefore, on the premise of complying with laws and policies, our lawyers have fully considered the above issues and put forward professional opinions from the legal perspective to determine the transaction mode of this project.

Second, according to the transaction mode, clear rights and obligations.

As mentioned above, after many times of analysis and demonstration, the transaction mode of the project is determined as customized construction, that is, the seller builds the data center according to the requirements of the client, and transfers the assets to Party A after the completion and acceptance. In the asset transfer contract, the lawyer of our firm has clearly defined the rights and obligations of both parties and determined the subject status of both parties. For example: the client is not the construction unit of the project, if he wants to control the construction progress, he can participate as the supervisor.

Third, ensure the operability of the scheme.

In the process of designing and demonstrating the transaction scheme, our lawyers simulate and deduce the transaction process to ensure the smooth legal relationship and the flow of funds in line with the commercial purpose and the rights and obligations of the subject, which makes the transaction scheme more operable.

Fourth, design risk control measures to ensure that the risk is controllable

As mentioned above, there are more than 100 lawsuits involving the seller of the project, and the potential debt risk is high, and the target assets may be sealed up. Therefore, in drafting the transaction documents, our lawyers designed risk control measures for the above problems, and made reasonable arrangements for the contracting parties, debt and risk sharing, so as to make the client's risk controllable.

[Achievements and summary of legal services]

As of November 2018, our lawyers and others have drafted the asset transfer contract of the project and participated in several rounds of negotiation. Now the client and the seller have basically reached an agreement and signed the contract. The project is progressing smoothly, basically realizing the client's business objectives and obtaining the client's approval.