EXHIBIT 10.22
TRANSFER AGREEMENT ON PROJECT COOPERATION FRAMEWORK AGREEMENT
This TRANSFER AGREEMENT ON PROJECT COOPERATION FRAMEWORK AGREEMENT (this
"AGREEMENT") is entered into in Beijing as of August 28, 2003 by and between the
following two Parties:
(1) SHANGHAI FOCUS MEDIA ADVERTISEMENT CO., LTD., a company of limited
liabilities duly incorporated and validly existing under the laws of
China, with its legal address at Floor 28-30, Zhaofeng World Trade
Mansion, ▇▇.▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ("PARTY A"); and
(2) BEIJING SUODI ADVERTISEMENT CO., LTD., a company of limited liabilities
duly incorporated and validly existing under the laws of China, with its
legal address at ▇▇▇▇ ▇▇▇, ▇▇▇▇, ▇▇▇▇▇ Office Building, ▇▇. ▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ("PARTY B").
WHEREAS: Party B and Shanghai Everease Communication Company entered into a
Project Cooperation Framework Agreement (agreement No. SD-YY-2003-1) on February
15, 2003, which has now been partly performed;
WHEREAS: Shanghai Everease Communication Company wishes to transfer all of its
rights and obligations under the Project Cooperation Framework Agreement to
Party A, and Party B agrees to such transfer;
WHEREAS: Party A and Party B agree to change and amend, in the light of the
current practical circumstances, some contents of the original Project
Cooperation Framework Agreement.
NOW, THEREFORE, upon friendly consultation, the Parties hereby enter into this
Agreement as follows:
1. Party B agrees that Shanghai Everease Communication Company shall transfer
all of its rights and obligation under the Project Cooperation Framework
Agreement to Party A, with such transfer to be effective on the date of
execution hereof.
2. Party A and Party B agree that the original Project Cooperation Framework
Agreement shall be amended to read as follows:
2.1 About the quantity and names of the target buildings
2.1.1 Party A and Party B agree to increase the quantity of the target
buildings to one hundred (100). There are 5 buildings within the 85
buildings set out
in Appendix 1.
2.1.2 Appendix 1 sets out the quantity and names of target buildings that
were concluded by agreements and completed in installation by Party
B for and on behalf of Shanghai Everease Communication Company prior
to the execution of this Transfer Agreement, which is acknowledged
hereby by Party A. Appendix 2 sets out the list of twenty (20)
buildings that are not completed in exploitation yet, and another
list of eight (8) standby buildings.
2.1.3 Where agreements are not to be concluded by those listed in the
original name list due to reasons attributable to the owner or
manager of the said buildings, Party A agrees that Party B may use
the standby buildings as substations in the process of exploitation
and construction.
2.2 About Party B's assistance to Party A with the sales of LCD TV
advertisement in Beijing
Party A and Party B acknowledge that the agreements in the original
Project Cooperation Framework Agreement shall no longer be performed, and
Party A and Party B will otherwise enter into an agreement for the
solution of the issue.
2.3 About the front end market developing fees
For the issue of front end market developing fees for Party B as it was
entrusted with the task of exploitation and construction in Beijing area
of LCD TV advertisement systems for advanced business buildings, Party B
and Shanghai Everease Communication Company entered into two supplementary
agreements, respectively on April 2003 and June 2003, by which Shanghai
Everease Communication Company agreed to pay Party B the front end market
developing fee in an aggregate amount Renminbi seven hundred thousand
(RMB700,000), and Party B did receive, prior to the execution hereof, such
an amount of Renminbi seven hundred thousand (RMB700,000) for the front
end market developing fee. In view of the increase in quantity of the
target buildings, Party A agrees to pay, within five (5) working days of
the execution hereof, to Party B a further amount of Renminbi three
hundred thousand (RMB300,000) as the front end market developing fee.
2.4 About the service fees to be paid by Party A annually to Party B
Party A and Party B agree that they shall no longer follow the agreement
set out in Article 16 of the original Project Cooperation Framework
Agreement to calculate the amount of service fees payable by Party A to
Party B annually, but to change to the method of a unitary annual payment
by Party A to Party B of an amount of
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Renminbi one million three hundred thousand (RMB1,300,000).
During the cooperation period, in case that the front lease in relation to
the relevant buildings is terminated ahead of schedule due to reasons
attributable to Party A, the amount of service fees payable by Party A to
Party B shall not be affected (i.e., no reduction to the amount).
2.5 About the time of payment of the service fees
2.5.1 Party A agrees to pay Party B in advance part of the first year's
service fees for an amount of Renminbi six hundred fifty thousand
(RMB650,000) before August 31, 2003, and Party A agrees to further
pay Party B the remaining amount of Renminbi five hundred fifty
thousand (RMB550,000) for the first year (after setting off Renminbi
one hundred thousand (RMB100,000) with the deposit originally paid
by Shanghai Everease Communication Company) within five (5) working
days of the agreement conclusion and installation completion of the
last target building.
2.5.2 From the second year, for each of the subsequent four (4) annual
payments of service fees, Party A shall pay fifty percent (50%) of
the service fees respectively in the first month and the sixth month
of each year (i.e., November 2004, April 2005, November 2005, April
2006, November 2006 and November 2007, April 2008) for the payment
of the current year's service fees.
2.6 About the conditions precedent of cooperation between the Parties
In consideration of the sincere honesty expressed by both Party A and
Party B for the continuation of cooperation between them, the Parties
agree to delete the last sentence in Article 11.1 of the original Project
Cooperation Framework Agreement, which reads "Party B shall guarantee the
execution of front lease agreements in ten (10) key target buildings,
which shall serve as the conditions precedent of cooperation for Party A's
entrustment to Party B on issues of expolitation and construction ".
2.7 About the quality of LCD TV equipment
Party A shall guarantee the requisite quality of the LCD TV equipment,
otherwise, Party A shall bear legal liabilities accordingly.
2.8 About the exploitation of twenty non-business buildings
As Party B is the only partner of business cooperation for Party A in
Beijing area,
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Party B agrees to exploit, in addition to one hundred (100) business
buildings, for Party A in Beijing area five (5) Kara OK clubs, five (5)
bars, five (5) restaurants, three (3) golf courses and two (2) gyms
(twenty non-business buildings in all) for installation of LCD TV
advertisement systems (for such twenty non-business buildings and other
stores of same grade/substitutable level, please see list in Appendix 3).
Party A shall bear the front lease rents and deposits for installation or
construction work in such twenty (20) non-business buildings.
2.9 About the exploitation of extra new buildings after the achievement of
exploitation of one hundred (100) target buildings
For new buildings to be exploited as designated by Party A, Party B may
only carry on such exploitation after confirmation by Party A before it
concludes contracts thereof, with all such costs as exploitation fees,
front lease rents and deposits for installation and construction work for
such new buildings to be borne by Party A, and Party A agrees also to pay
Party B an annual service fee in the amount Renminbi thirteen thousand
(RMB13,000) per building.
2.10 About the contract renewal for target buildings with a lease term yet less
than five (5) years
As the original Project Cooperation Framework Agreement stipulates in
Article 1 of Chapter 1 (for cooperation method) and Article 6.3 of Chapter
2 that, in case of buildings where the front lease is available only for
one (1) year or the lease term is less than five (5) years for reasons
attributable to the building owners, Party B shall continue, at Party A's
request and as the only authorized cooperator, to perform the contract
renewal obligations. The Parties now make supplements thereto as follows:
2.10.1 In case of buildings where the lease is less than five (5) years,
Party B shall continue, at Party A's request and as the only
authorized cooperator, to perform the contract renewal obligations.
2.10.2 At contract renewal, the front lease rents in the buildings shall
be negotiated and decided by Party A and Party B together with the
building owner according to the then market situation.
2.10.3 Party A and Party B agree that, in following circumstances, Party B
may use new buildings of same grade to serve as substitutes:
A. for reasons attributable to the building owner, the contract
is not to be renewed; or
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B. where Party A holds it necessary to change to new buildings.
For matters of exploitation in new buildings that serve as
substitutes, Article 2.9 shall apply.
2.10.4 In respect of extra costs and expenses demanded by the building
owner other than the front lease rents at contract renewal of
original buildings, Party B will endeavor to avoid, for the benefit
of Party A, such extra costs and expenses; if it is impossible to
avoid, Party A agrees that Party B may use new buildings of the
same grade as replacements.
2.11 About the default liabilities
In case that Party A fails to pay in a timely manner the agreed service
fees, Party A shall be charged a liquidated damages at the rate of five
per ten thousand (0.05%) for each day; where the payment is delayed for
more than ninety (90) days, Party B shall have the right to terminate the
relevant contract, and demand Party A to pay fifty percent (50%) of the
service fees payable for the remaining period of the original cooperation
period as the compensation for Party B's anticipated profit loss.
2.12 About the safe keeping of standby machines
Party A and Party B agree that the thirty (30) standby machines, as
stipulated in Article 22 of the original Project Cooperation Framework
Agreement, shall be kept by Party A's Beijing branch, and Party B may
collect and have such machines according to the financial procedures when
it feels necessary.
2.13 About the photo taking costs incurred by Party B when carrying on
advertisement supervisory work
Party A agrees to bear such costs as film rolls, film developing and
printing, etc.
2.14 About the correspondence address of Party A for notice delivery
Party A: SHANGHAI FOCUS MEDIA ADVERTISEMENT CO., LTD.
Address: Floor 28-30, Zhaofeng World Trade Mansion, ▇▇.▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇.
Postcode: 200050
Telephone: ▇▇▇-▇▇▇▇▇▇▇▇/6117
3. Party B shall assist Party A to complete, within three (3) months of the
date hereof, the transfer of contracts already concluded with building
owners. From the date hereof, Party B shall also enter into front lease
agreement with new building
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owners directly in the name of Party A, provided that Party A shall issue
in a timely manner relevant documents of power of attorney to Party B.
4. Party B suggests that there shall be a union/entertainment party held in
December each year for all clients in relation to the buildings, as to
adapt to the demands of market competition, with the costs thereof to be
borne equally between Party A and Party B, provided that each of such
party shall be held only after acknowledgement by Party A.
5. This Agreement is executed in five (5) copies, with Party A and Party B
each keeping two (2) copies, and Shanghai Everease Communication Co., Ltd.
keeping one (1) copy. All the copies of this Agreement shall be equal in
legal force, which shall become effective on the date of signature and
affixation of corporate seals by the Parties.
PARTY A: SHANGHAI FOCUS MEDIA ADVERTISEMENT CO., LTD. (Corporate Seal)
Signed by: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
Position: Authorized Representative
PARTY B: BEIJING SUODI ADVERTISEMENT CO., LTD. (Corporate Seal)
Signed by: /s/ ▇▇▇▇ ▇▇▇
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Name: ▇▇▇▇ ▇▇▇
Position: Authorized Representative
ACKNOWLEDGED BY: SHANGHAI EVEREASE COMMUNICATION CO., LTD. (Corporate Seal)
Signed by: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
Position: Authorized Representative
Attached:
1. List of Target Buildings with Contracts Already Concluded;
2. List of 20 Target Buildings with Contracts to be Concluded, and List of 8
Standby/Substitutable Buildings of Same Grades;
3. List of 20 Non-Business Buildings, and List of Standby/Substitutable
Stores of Same Grades.
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