Cooperation Agreement
[Reference
Translation]
by
and between
China
Broadband Limited
and
Jinan
Guangdian Jiahe Digital Television Co., Ltd.
December
2006
Table
of Contents
|
Chapter
|
Page
|
|||
|
1
|
Definitions
and Interpretations
|
2
|
||
|
2
|
New
Co Establishment
|
5
|
||
|
3
|
Inter-Company
Relationship
|
8
|
||
|
4
|
Representations
and Warranties
|
10
|
||
|
5
|
Covenants
|
11
|
||
|
6
|
Conditions
Precedent
|
14
|
||
|
7
|
Closing
|
15
|
||
|
8
|
Effectiveness
and Termination
|
16
|
||
|
9
|
Events
of Breach
|
17
|
||
|
10
|
Force
Majeure
|
18
|
||
|
11
|
Confidentiality
|
19
|
||
|
12
|
Miscellaneous
|
20
|
Schedules
| A. | List of Assets |
|
B.
|
List
of Party B’s Key Staff
|
| C. | List of Governmental Authorizations |
This
Cooperation
Agreement (Agreement)
is
entered into on this [26] day of December 2006 in [Jinan],
People’s Republic of China (PRC)
by
and between
|
(1)
|
China
Broadband Limited (Party A),
a
Cayman Islands company with its registered address at [1900 Xxxxx
Xxxxxx
Xxxxx 000 Xxxxxxx, XX 00000], the legal representative of which is
Xxxxxxx
Xxxxxxx,
a
United States of America (USA) citizen;
and
|
|
(2)
|
Jinan
Guangdian Jiahe Digital Television Co., Ltd.
(Party
B),
a PRC company with its registered address at [No.32, Xxxx Xxx Yi
Road]
Jinan, PRC, the legal representative of which is Jiang Bing, a PRC
citizen.
|
RECITALS
|
A.
|
Party
B is engaged inter
alia
in
the provision of the Business (as defined below) and has obtained
the
licenses necessary to operate the Business in the
PRC.
|
|
B.
|
Party
B desires to spin off the Assets (as defined below) to establish
with
Party A’s Affiliate a new company (New
Co)
which will cooperate with Party B on the
Business.
|
|
C.
|
The
parties signed a letter of intent outlining the above on 9 August
2006.
|
NOW,
THEREFORE,
the
parties agree as follows:
Chapter
I Definitions
and Interpretations
|
1.1
|
Definitions
|
Unless
otherwise indicated, the following terms in this Agreement shall have the
meanings set forth below:
|
Affiliate
|
in
relation to an entity, means a company:
(a) in
which the entity holds, directly or indirectly, at least 10% of the
equity
interest or voting rights;
(b) which
is a Subsidiary of the entity’s Parent
Company;
|
|
(c) which
owns or controls, directly or indirectly, any equity interest or
voting
rights of the Parent Company of the entity; or
(d) which
is a Subsidiary of the Parent Company of the entity described in
(c)
above;
|
|||
|
Appraisal
|
the
appraisal on the Assets conducted by a qualified appraisal agent
hired by
Party B;
|
||
|
Assets
|
any
assets relating to the operation of the Business, as listed in Schedule
A;
for avoidance of doubt, the total net value of the Assets shall be
no less
than RMB 83,918,200;
|
||
|
Business
|
the
access services with respect to the wired broadcasting/television
broadband, wireless broadband, digital private lines, data transmission,
website, Internet content services and Internet value-added services;
and
other wired and digital television value-added services agreed upon
by the
parties
|
||
|
Closing
|
the
date of fulfillment of all the conditions precedent listed in Article
6.1
(unless waived in accordance with Article 6.2.3) which shall occur
no
later than [February 15th
]
2007, unless extended in accordance with Article 6.2.2;
|
||
|
Deposit
|
as
defined in Article 8.2;
|
||
|
Exclusive
Cooperation Agreement
|
as
defined in Article 3.1;
|
||
|
Force
Majeure
|
any
earthquake, storm, fire, flood, war or other significant event of
natural
or human-caused disaster arising after signing hereof which is
unavoidable, not possible to overcome, beyond the control of either
party
and prevents the total or partial performance of this Agreement by
either
party;
|
||
|
Governmental
Authorizations
|
as
defined in Article 4.2.5;
|
|
Hong
Kong
|
as
defined in Article 12.4.2.2;
|
||
|
Networks
Center
|
Jinan
Broadcasting and Television Information Networks Center, which holds
48%
equity of Party B’s equity interest;
|
||
|
Parent
Company
|
in
relation to an entity, means an entity of which a company is a Subsidiary
(as defined below);
|
||
|
PRC
Law
|
all
laws and legislation of the PRC that are in effect, including laws,
regulations, resolutions, decisions, decrees and orders of government
agencies and other documents of a legislative, administrative or
judicial
nature;
|
||
|
RMB
|
Renminbi,
the lawful currency of the PRC;
|
||
|
Subsidiary
|
in
relation to an entity, means an entity in which another company holds,
directly or indirectly, 50% or more of the entity’s total equity interest
or voting rights;
|
||
|
Tax
|
all
forms of taxation, including enterprise income tax, business tax,
value-added tax, stamp duty and individual income tax levied by the
PRC
tax authorities pursuant to PRC Law, as well as any penalty, surcharge
or
fine in connection therewith;
|
||
|
Trade
Secret
|
any
information relating to this Agreement or the parties, including
any
information regarding costs, technologies, financial contracts, future
business plans and any other information deemed by the parties to
be
confidential, and which is unknown by the public, has practical value
and
is of economic benefit to the relevant party;
|
||
|
Transaction
Documents
|
all
documents that require signing under PRC Law in order to complete
the
transactions contemplated under this Agreement;
|
||
|
Transferred
Staff
|
as
defined in Article 2.4.1;
|
||
|
USD
|
United
States Dollar, the lawful currency of the United States of
America.
|
| 1.2 |
Interpretations
|
All
headings used herein are for reference purposes only and do not affect the
meaning or interpretation of any provision hereof. Any reference herein to
an
Article, Chapter or Schedule is to an article, chapter or schedule of this
Agreement. The use of the plural shall include the use of the singular, and
vice
versa. Unless otherwise indicated, a reference herein to a day, month or year
is
to a calendar day, month or year. A reference to a business day is to a day
on
which commercial banks are open for business in the PRC. The use of the
masculine shall include the use of the feminine, and vice versa. The term
“including”, shall mean “including without limitation”.
Chapter
II New
Co Establishment
| 2.1 |
Asset
Appraisal
|
2.1.1 Party
B
shall, at its own expense, hire a qualified appraisal agent to conduct the
Appraisal.
2.1.2 Party
B
covenants that the Appraisal shall be completed no later than
20th
December
2006.
|
2.2
|
Establishment
of New Co
|
| 2.2.1 |
As
soon as practicable after the completion of the Appraisal, Party
B shall
contribute the Assets to the New
Co.
|
| 2.2.2 |
The
registered capital of the New Co shall be RMB 83,918,200. Party A
shall
contribute to the New Co cash equivalent of RMB 42,798,300 in
installments, and shall enjoy 51% equity interests in the New Co.
Party B
shall contribute the Assets to New Co and shall be entitled to 49%
equity
interests in the New Co.
|
| 2.2.3 |
Party
B’s contribution of the Assets to the New Co’s registered capital shall be
made in accordance with the appraised value of the Assets as stated
in the
Appraisal report, and shall be made as soon as practicable after
completion of Approval.
|
| 2.2.4 |
The
New Co’s business scope shall include the provision of wired
broadcasting/television broadband and wireless broadband access
services, data transmission via
private networks, Internet content and website services, consulting,
software, system integrity, project consignment and other digital
television value-added services agreed by the parties. The business
scope
of the New Co. shall be subject to the examination and approval of
the
governmental authorities.
|
| 2.3 |
Governmental
Approvals
|
Party
B
shall, at its own expense, obtain any and all prior approvals, consents and
(or)
certificates and make all filings, necessary under PRC Law for the establishment
of the New Co. The relevant fees shall be allocated in accordance with the
parties’ respective shares of equity interests in the New Co.
| 2.4 |
Retention
/ Dismissal of Employees
|
| 2.4.1 |
Party
B shall provide Party A with written notice as to which of Party
B’s
employees will be retained by the New Co (Transferred
Staff),
which personnel shall include the key staff members listed in Schedule
B.
Such list shall be subject to the confirmation of the
parties.
|
| 2.4.2 |
Party
B shall be responsible for any costs related to any labor disputes
that
may arise at any time from Transferred Staff in respect of their
employment relationship with Party
B.
|
| 2.4.3 |
Party
B shall ensure that any arrangement which it makes with the Transferred
Staff shall not give rise to or result in any adverse impact on the
employee relations, business, reputation, operations or financial
or Tax
position of Party B or the New Co.
|
| Party B shall ensure that, in connection with the said arrangements, no commitment will be made, and no obligation or liability will be incurred, by the New Co. |
| In the event that there is any such commitment, obligation or liability (including liability in relation to Tax) in respect of the New Co, Party B shall indemnify the New Co against all losses, claims, damages, costs and expenses arising therefrom. |
| 2.4.4 |
Party
B shall make its best efforts to encourage the Transferred Staff
to enter
into standard employment contracts with the New Co, or sign secondment
agreements (containing non-competition and confidentiality commitments)
with the Transferred Staff to second the Transferred Staff to the
New Co
that are satisfactory to Party A.
|
|
2.5
|
Corporate
Governance
|
| 2.5.1 |
The
New Co shall establish a board of directors, consisting of 5 directors.
Party A shall appoint 3 directors and Party B shall appoint 2
directors.
|
| 2.5.2 |
The
chairman of the New Co’s board shall be appointed by Party B, and the
general manager and the financial manager shall both be appointed
by Party
A’s Affiliate. The parties agree that the first chairman shall be the
director of the Networks Center.
|
| 2.5.3 |
The
New Co’s board shall review the details of corporate governance as
described above and amend the same (if necessary) at any time after
the 1
year anniversary of the New Co’s
establishment.
|
| 2.6 |
Profit
Consolidation
|
Party
B
agrees that Party A’s Affiliate may consolidate the New Co’s profits for
purposes of financial reports as permitted under applicable laws. For this
purpose, Party B agrees to amend the documents relating to the New Co (including
the articles of association) if and when necessary.
Chapter
III Inter-Company
Relationship
|
3.1
|
Exclusive
Cooperation Agreement
|
As
soon
as practicable after the establishment of the New Co, Party B shall sign, and
cause Networks Center to sign, an exclusive cooperation agreement (Exclusive
Cooperation Agreement)
with
the New Co for a term of 20 years.
| 3.2 |
Cooperative
Scope
|
| 3.2.1 |
Party
B shall, and shall cause Networks Center to, provide full support
and
favorable treatment to the New Co with respect to the Business, including
causing Networks Center to provide the New Co with mainline, tube,
CM
physical transmission tube and the favorable treatment on usage of
redundant fibers in cable television networks. The details thereof
shall
be subject to the separate
negotiation.
|
| 3.2.2 |
Party
B shall provide, and shall cause the Networks Center to provide,
the New
Co with the favorable treatment of using its server room, business
hall,
office, project construction services and client service center.
In
addition, Party B shall, and shall cause Networks Center to, share
their
respective resources with the New
Co.
|
Cooperation
Agreement
-
7
-
[Reference
Translation]
| 3.2.3 |
Party
B shall, and shall cause the Networks Center to guarantee for the
New Co,
during the promotion of inter-active digital television business
by Party
B and the Networks Center, to implement the Internet access services
(IP
or CM) provided by the New Co as the re-transmission tube in priority,
Party B and the Networks Center reach exclusive cooperation with
the New
Co on CM broadband access services. The Networks Center must guarantee
smoothness of the two-way networks. The New Co shall pay the Networks
Center the CM maintenance fee according to certain failure rate.
|
| 3.2.4 |
The
maintenance fee for IP networks and private networks shall be paid
by the
New Co to the maintenance provider in broadcasting/television
system.
|
|
3.3
|
Revenue
Transfer
|
All
the
pre-Tax revenues (less the relevant turnover tax) of Party B generated during
the 20-year period of the Exclusive Cooperation Agreement and relating to the
Business shall be paid by Party B to the New Co as service fees under the
Exclusive Cooperation Agreement.
If
the
parties need to adjust the specific financial arrangement of the revenue
transfer under this revenue transfer framework, such as paying all the pre-Tax
revenues to the New Co after reduction of direct cost (such as broadband
telecommunication fee), Party B will make its best efforts to cooperate with
the
New Co on the revenue transfer hereof under the premise of compliance with
relevant rules.
| 3.4 |
Exclusivity
|
| 3.4.1 |
With
respect to the transactions or services under the Exclusive Cooperation
Agreement, Party B shall not, and shall cause its shareholders to
not,
directly or indirectly (through agents or otherwise), encourage or
solicit
any inquiries or accept any proposals by, or engage in any discussions
or
negotiations with or furnish any information to, any other person
or
entity concerning any transactions or services under the Exclusive
Cooperation Agreement.
|
| 3.4.2 |
If
Party B or any of its shareholders receives any proposal or other
communication from a third party relating to a proposed cooperation
relating to any aspect of the Business, Party B will promptly communicate
to Party A the substance thereof. Party B will cause its
shareholders to observe the terms of this Article 3.4, and Party
B will be
responsible for any breach of this Article 3.4 by any of its
shareholders.
|
Cooperation
Agreement
-
8
-
[Reference
Translation]
Chapter
IV Representations
and Warranties
| 4.1 |
Joint
Representations and Warranties
|
|
Each
of the parties represents and warrants
that:
|
| 4.1.1 |
it
has all necessary power and authority to execute, deliver and perform
this
Agreement and all Transaction Documents to which it is a party;
|
| 4.1.2 |
the
execution and performance of this Agreement and any Transaction Documents
to which it is a party have been duly and validly authorized by all
necessary corporate action; and
|
| 4.1.3 |
the
execution, delivery and performance of this Agreement or any Transaction
Documents to which it is a party will not contravene, conflict with,
or
result in a violation of any provision of its organizational documents
or
any contract, agreement, understanding, other legal arrangement,
law or
order to which it is subject.
|
| 4.2 |
Representations
and Warranties of Party B
|
|
Party
B further represent and warrant to Party A
that:
|
| 4.2.1 |
the
Assets are free from any
encumbrances;
|
| 4.2.2 |
there
is no lawsuit, third party claim, order or investigation pending
against
itself relating to the Assets or Business by any third party, court,
or
governmental or arbitral body;
|
| 4.2.3 |
all
agreements with third parties, including employees and customers,
have at
all times been honored completely and timely by
itself;
|
| 4.2.4 |
the
Assets constitute all of the assets used in or necessary for the
operation
of
the Business; and
|
| 4.2.5 |
all
consents, approvals, permits and filings (Governmental
Authorizations,
including the items as listed in Schedule C) required under PRC Law
for
the due and proper operation of the Business, have been duly obtained
from
the appropriate authorities and are in full force and effect. For
the avoidance of doubt, the Governmental Authorizations include any
and
all requirements of any governmental body, including the registrations
with the Ministry of Information Industry, the State Administration
of
Radio, Film and Television, the State Administration of Industry
and
Commerce, tax bureaus, customs authorities, and the local counterpart
of
each of the aforementioned governmental
bodies.
|
Cooperation
Agreement
-
9
-
[Reference
Translation]
| 4.3 |
Independent
Effect
|
The
representations
and warranties
shall be separate and independent and, save as expressly provided, shall not
be
limited by reference to any of the other representations
and warranties
or anything in this Agreement.
Chapter
V Covenants
| 5.1 |
Transferred
Staff
|
In
respect of the Transferred Staff, Party B shall:
| 5.1.1 |
fully
settle any severance payments with the Transferred Staff, as required
by
PRC Law;
|
| 5.1.2 |
make
all required social security contributions for the Transferred Staff
in
full and on time, or attend to all necessary procedures to obtain
exemptions or waivers of such obligations from relevant government
authorities and (or) the Transferred Staff to the extent necessary,
to
ensure that the Transferred Staff may be employed by the New
Co;
|
| 5.1.3 |
fully
pay all wages, allowances, subsidies (including medical
subsidies), bonuses or other outstanding payments or benefits to
all of
the Transferred Staff; and
|
| 5.1.4 |
withhold,
file and pay the individual income tax payable on wages, bonuses,
allowances, subsidies, or other payments or benefits received in
respect
of the Transferred Staff.
|
| 5.2 |
Assets
/ New Co
|
At
any
time prior to Closing, Party B covenants that it shall not, without the prior
written consent of Party A:
| 5.2.1 |
create
or permit to arise any lien, encumbrance, pledge, mortgage or any
security
or other third party right or interest on or in respect of any of
the
Assets or grant or issue, or agree to grant or issue, any guarantee
thereover;
|
Cooperation
Agreement
-
10
-
[Reference
Translation]
| 5.2.2 |
enter
into any transaction or arrangement with respect to the
Assets;
|
| 5.2.3 |
depart
from the ordinary course of Party B or the New Co’s daily business
operations in either of the following
respects:
|
| 5.2.3.1 |
it
will not enter into any agreements or materially modify or terminate
any
agreements related to the Business;
and
|
| 5.2.3.2 |
it
will not enter into any agreements relating to the Business, signed
after
the date hereof, where the value or consideration of the proposed
agreement exceeds USD[1,000]
or
has a term of more than [3]
months, unless Party A provides its prior written consent, which,
for the
purpose of this Article, shall include consent by
e-mail.
|
| 5.2.4 |
increase
or agree to increase the remuneration (including bonuses, commissions
and
benefits in kind) of any of the members of the board of directors
or
employees of the New Co or provide or agree to provide any gratuitous
payment or benefit to any such person or any of their dependents;
or
|
| 5.2.5 |
enter
into any agreement or arrangement to, or grant any power of attorney
or
otherwise authorize any other person to, do any of the
above.
|
| 5.3 |
Transactions
|
In
respect of the transactions contemplated under this Agreement, Party B shall,
using its own expenses, obtain all necessary consents, approvals or
authorizations of, or make all necessary declarations, filings or registrations
with, any governmental authority in connection with the execution, delivery
and
performance of this Agreement and any Transaction Documents to which it is
a
party.
Cooperation
Agreement
-
11
-
[Reference
Translation]
| 5.4 |
Governmental
Authorizations
|
| 5.4.1 |
Party
B shall, using its own expenses, ensure that the annual inspection
and
(or) renewal of Governmental Authorizations (where applicable) are
duly
and timely made and all Governmental Authorizations are in full force
and
effect throughout the term under the Exclusive Cooperation Agreement
as
described in Article 3.1 and any terms extended by the parties
thereunder.
|
| 5.4.2 |
Immediately
after PRC Law permits, Party B shall use its best efforts to, cause
the
New Co to obtain the Governmental Authorizations required for the
operation of the Business.
|
| 5.5 |
Business
|
| 5.5.1 |
Party
B agrees to use its best commercial efforts to continue operating
the
Business until the parties agree
otherwise.
|
| 5.5.2 |
Within
1 year after the establishment of the New Co, the parties to the
New Co
shall provide working capital support for the New Co, if it is in
need of
the same.
|
| 5.6 |
Non-Competition
|
After
Closing, Party B shall not, and shall cause its shareholders to not, without
the
prior written approval of Party A, invest in or manage any business that
competes directly (or indirectly) with the Business nor shall it employ, recruit
or attempt to recruit any of the Transferred Staff.
| 5.7 |
Indemnification
by Party B
|
Party
B
hereby unconditionally and irrevocably agrees to indemnify in perpetuity Party
A
and its Affiliates and Subsidiaries and hold them harmless from and against
all
losses, claims, damages, expenses (including legal expenses) and liabilities
which they may sustain, suffer or incur in connection with the transactions
contemplated under this Agreement and as a result of any breach of this
Agreement or the Transaction Documents.
Cooperation
Agreement
-
12
-
[Reference
Translation]
| 5.8 |
Notification
by Parties
|
Each
party shall forthwith notify the other party upon becoming aware of any event
that may show, reveal or cause any of the representations or warranties to
be
incorrect, untrue, misleading or breached in any material respect or that may
have any material adverse effect on the assets or liabilities of the notified
party.
Chapter
VI Conditions
Precedent
| 6.1 |
Conditions
Precedent
|
|
Closing
is subject to the satisfaction of all of the following conditions
precedent:
|
| 6.1.1 |
the
execution and delivery of the Transaction Documents by all the parties
thereto;
|
| 6.1.2 |
the
representations and warranties of Party B remaining true and accurate
and
being fully adhered to in all material respects at the time of
Closing;
|
| 6.1.3 |
the
due completion of Party B’s covenants under Articles 5.1, 5.2 and 5.3;
and
|
| 6.1.4 |
Party
B having no less than 40,000 customers with respect to the
Business.
|
| 6.2 |
Satisfaction
and Waiver of Conditions
Precedent
|
| 6.2.1 |
Party
B shall notify Party A upon satisfaction of all of the conditions
precedent described in Article 6.1
thereafter within 3 business days.
Within 3 business days after the said notification, Party A shall
confirm
the same in writing to Party B. Closing shall then be arranged within
3
business days after receipt of Party A’s confirmation.
|
| 6.2.2 |
In
the event that the conditions precedent set forth in Article 6.1
are not
fulfilled (or waived as provided in Article 6.2.3) on or before
[30
March 2007],
or such later date as the parties may agree, this Agreement (except
Chapter 11, and Articles 12.3 and 12.4) shall become null and void
and be
of no further effect whatsoever and all the obligations and liabilities
of
the parties hereunder shall cease and terminate (save for any antecedent
breaches of this Agreement).
|
Cooperation
Agreement
-
13
-
[Reference
Translation]
| 6.2.3 |
One
or more of the conditions precedent listed in Article 6.1 may be
waived by
Party A at its sole discretion by sending a notice in writing to
Party
B.
|
Chapter
VII Closing
| 7.1 |
Closing
|
Subject
to the conditions precedent having been fulfilled (or waived as provided in
Article 6.2.3), Closing shall be completed within 1 month after the execution
of
this Agreement. Closing shall be held at the Beijing offices of TransAsia
Lawyers (Xxxxx 0000, Xxxxx World Tower 1, Xx. 0 Xxxxxxxxxxxxx Xxxxxx, Xxxxxxx,
XXX) or at such other location as the parties agree.
At
Closing, to the extent not previously executed and delivered, the parties shall
execute and deliver, and shall cause any of the other parties thereto to execute
and deliver, the Transaction Documents.
| 7.2 |
Payment
of price
|
Party
A
or its Affiliate shall pay the price after Closing in accordance with the
following arrangements:
| 7.2.1 |
As
soon as possible after the Closing, pay USD equivalent to RMB 20,000,000,
which amount shall include the Deposit that Party A has paid in accordance
with Article 8.2;
|
| 7.2.2 |
Within
9 months after the Closing, upon the fulfillment of Party B’s
responsibilities under Article 5.1 to 5.6 and any other conditions
agreed
by the parties afterward, pay USD equivalent to RMB
22,798,300;
|
| 7.2.3 |
The
price mentioned above shall be paid in USD. The exchange rate shall
be
calculated based on the median rate published by People’s Bank of China of
the prior day.
|
Chapter
VIII Effectiveness
and Termination
| 8.1 |
Effective
Date
|
This
Agreement shall be effective upon the date of its signing by the parties.
| 8.2 |
Deposit
|
Within
5
business days after the effectiveness of this Agreement, Party A shall pay
a
USD100,000 deposit (Deposit)
to
Party B. The Deposit will be applied against the price under Article
7.2. Party B will return the Deposit to Party A (or its Affiliate) if this
Agreement is terminated for any reason other than if due solely to Party A’s
breach of any provisions under this Agreement.
Cooperation
Agreement
-
14
-
[Reference
Translation]
| 8.3 |
Termination
|
| 8.3.1 |
This
Agreement shall terminate with immediate effect if the parties cannot
complete the negotiation and execution of the agreements necessary
for the
transactions contemplated under this Agreement above within 90
days after the execution hereof unless such period is extended by
the
parties.
|
| 8.3.2 |
This
Agreement may be terminated with immediate effect by any party by
means of
written notice to the other party under any of the following
circumstances:
|
| 8.3.2.1 |
where
Closing has not occurred on or before 30 March 2007, provided, however,
that the right to terminate this Agreement shall not be available
to any
party whose failure in any material respect to fulfill any obligation
under this Agreement shall have been the cause of the failure for
any
condition precedent to Closing to be
satisfied;
|
| 8.3.2.2 |
where
the other party has committed a breach of this Agreement, as described
in
Article 9.1;
|
| 8.3.2.3 |
where
the other party becomes insolvent, if an order is made or resolution
passed for the administration, winding-up or dissolution of any party
(otherwise than for the purposes of a solvent corporate reconstruction),
if an administrative or other receiver, manager, liquidator,
administrator, trustee or similar officer is appointed over all or
a
substantial part of the assets of such other party, or if such other
party
enters into or proposes any composition or arrangement with its creditors
generally analogous to the foregoing;
or
|
| 8.3.2.4 |
where
Force Majeure prevails for a period of 30 days or more and has a
material
adverse effect
on
this Agreement.
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Cooperation
Agreement
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[Reference
Translation]
| 8.4 |
Consequence
Upon Termination
|
|
Upon
termination hereof, this Agreement shall be of no further effect
and no
party shall have any right against any of the other parties in connection
with this Agreement; provided, however, that nothing herein shall
relieve
any party of any liability before the termination of this
Agreement.
|
Chapter
IX Events
of Breach
| 9.1 |
Events
of Breach
|
The
occurrence of any of the following events shall constitute a breach of this
Agreement:
| 9.1.1 |
either
party has materially breached the terms hereof or has failed to perform
in
any material respect its obligations hereunder, and such breach or
nonperformance has not been remedied within a period of 10 days after
receipt of the other party’s written notice requesting such remedy;
and
|
| 9.1.2 |
any
representation or warranty made by either party shall prove to have
been
or become false or misleading in any material
respect.
|
| 9.2 |
Liabilities
for Breach
|
Where
either party commits a breach of this Agreement, it shall be liable to
compensate the other party for any and all damages caused to it as a result
of
the breach, excluding indirect or consequential damages.
Chapter
X Force
Majeure
| 10.1 |
Consultation
|
In
the
event of Force Majeure, the parties shall promptly consult with each other
to
find a solution to the situation.
Cooperation
Agreement
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[Reference
Translation]
| 10.2 |
Relief
from Obligations
|
Should
the occurrence of a Force Majeure result in either party’s failure to perform
its obligations under this Agreement in whole or in part, that party may, unless
otherwise stipulated by law, be exempted from performing those obligations
to
the extent of the effect of the Force Majeure in question.
| 10.3 |
Suspension
of Performance
|
Subject
to this Chapter 10, the party affected by Force Majeure may suspend the
performance of its obligations under this Agreement
to the
extent and for the duration thereof until the effect of the Force Majeure no
longer operates. However, that party shall exert its best efforts to remove
any
impediments resulting from the Force Majeure and to minimize to the greatest
possible extent any damages incurred. With the agreement of the parties, the
term of this Agreement
shall be
extended by the period of such suspension without penalty to either
party.
| 10.4 |
Written
Evidence
|
The
party
claiming Force Majeure shall,
as
soon as possible after the occurrence of the Force Majeure, inform the other
party of the situation and specify the reason for its failure to perform this
Agreement,
so as
to minimize the damages inflicted upon that party, and shall provide the other
party with written evidence, certified by the relevant government authority,
of
the occurrence of the Force Majeure.
| 10.5 |
Non-Exemption
|
A
party
shall not be exempted from performing its obligations under this Agreement
where
Force Majeure occurs following the delay by that party to perform such
obligations.
Chapter
XI Confidentiality
| 11.1 |
Non
Disclosure
|
From
the
date hereof until 5 years hereafter, neither party shall disclose or communicate
to any person, other than to their respective employees and affiliates for
the
sole purpose of implementing the agreements contemplated hereunder or as
instructed by the other parties, any Trade Secret which may be within or may
come into its knowledge.
Cooperation
Agreement
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[Reference
Translation]
| 11.2 |
Breach
of Obligations
|
The
parties shall take all necessary measures (including the signing of
confidentiality agreements) to ensure that
their
respective directors, employees, agents, contractors, suppliers and advisors
also comply with the confidentiality obligations set forth in this chapter,
and
shall arrange for the summary dismissal without compensation of any such person
who breaches these obligations.
| 11.3 |
Exceptions
|
The
disclosure of a Trade Secret by either party shall not be deemed to be in breach
of this Chapter if any of the following circumstances apply:
| 11.3.1 |
the
information is in the
public domain at the time of
disclosure;
|
| 11.3.2 |
the
information is
disclosed pursuant to the prior written agreement of the
parties;
|
| 11.3.3 |
the
information is required
by any government authority or law to which a party, or its Affiliate,
is
subject; or
|
| 11.3.4 |
the
information is provided to any director, employee, agent, contractor,
supplier or advisor of an Affiliate in the ordinary course of business
pursuant to the prior written agreement of the
parties.
|
Chapter
XII Miscellaneous
| 12.1 |
Copies
|
| 12.1.1 |
This
Agreement shall be executed in 2 sets of original, in the English
and
Chinese languages, with 1 set of original for each party. If the
2
versions are inconsistent, the Chinese language version shall
bind.
|
| 12.1.2 |
This
Agreement may be executed in 1 or more counterparts, each of which
will be
deemed to be an original copy of this Agreement and all of which,
when
taken together, will be deemed to constitute 1 and the same instrument.
|
Cooperation
Agreement
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[Reference
Translation]
| 12.2 |
Notice
|
|
All
notices and communications (except for the prior consent issued under
Article 6.2.4.2) between the parties shall be made in writing and
in the
English and Chinese languages by fax, delivery in person (including
courier service) or registered airmail letter to the appropriate
correspondence addresses set forth
below:
|
If
to
Party A:
|
Address:
|
[1900
Ninth Xxxxxx Xxxxx 000]
|
||
|
Telephone:
|
[000-000-000-0000]
|
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|
Fax:
|
[000-000-000-0000]
|
||
|
Attention:
|
[Xxxxxxx
X. Xxxxxxx]
|
If
to
Party B:
|
Address:
|
[No.32,
Xxxx Xxx Yi Road, Jinan ]
|
||
|
Telephone:
|
[86531-85655255]
|
||
|
Fax:
|
[86531-82953142]
|
||
|
Attention:
|
[Bing,
Jiang]
|
The
time
of receipt of the notice or communication shall be deemed to be:
| 12.2.1 |
if
by fax, at the time displayed in the corresponding transmission record,
unless such facsimile is sent after 5:00 p.m. or on a non-business
day in
the place where it is received, in which case the date of receipt
shall be
deemed to be the following business
day;
|
| 12.2.2 |
if
in person (including courier service), on the date that the receiving
party signs for the document; or
|
| 12.2.3 |
if
by registered mail (including express mail), 7 days after the issuance
of
a receipt by the post office.
|
| 12.3 |
Governing
Law
|
|
The
formation of this Agreement, its validity, interpretation, execution
and
settlement of disputes hereunder will be governed by PRC
Law.
|
| 12.4 |
Dispute
Resolution
|
| 12.4.1 |
If
any dispute arises out of or in connection with this Agreement, the
parties shall attempt in the first instance to resolve such dispute
through friendly consultation or
mediation.
|
Cooperation
Agreement
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[Reference
Translation]
| 12.4.2 |
If
the dispute cannot be resolved in the above manner within 30 days
after
the commencement of consultations, either party may submit the dispute
to
arbitration as follows:
|
| 12.4.2.1 |
all
disputes arising out of or in connection with this Agreement shall
be
finally settled under the Rules of Arbitration of the International
Chamber of Commerce by a sole arbitrator appointed in accordance
with
those rules; and
|
| 12.4.2.2 |
the
place of the arbitration shall be Hong Kong Special Administration
Region
of the PRC (Hong
Kong)
and the arbitration shall be conducted in the English language, with
the
arbitral award being final and binding upon the parties. If either
party
cannot travel to Hong Kong to attend a hearing or other meetings
in
respect of the arbitration, the parties agree that such hearing or
meeting
shall take place in Shanghai, PRC. The cost of arbitration shall
be
allocated as determined by the arbitrator. Any award rendered by
the
arbitrator shall be enforced by any court having jurisdiction upon
the
losing party or its assets in accordance with the Convention
on the Recognition and Enforcement of Foreign Arbitral
Awards
(1958).
|
| 12.4.3 |
When
any dispute is submitted to arbitration, the parties shall continue
to
perform their obligations under this
Agreement.
|
| 12.5 |
Waiver
|
|
No
failure or delay on the part of either party in the exercise of any
right
hereunder shall impair such right or be construed to be a waiver
of such
right or acquiescence in any breach of any representation, warranty,
covenant or agreement herein, nor shall any single or partial exercise
or
waiver of any such right preclude other or further exercise thereof
or of
any other right.
|
| 12.6 |
Prior
Agreement
|
|
This
Agreement supersedes all prior agreements, whether written or oral,
between the parties with respect to its subject matter and, along
with the
Transaction Documents, constitutes the entire agreement between the
parties with respect to its subject matter.
|
Cooperation
Agreement
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[Reference
Translation]
| 12.7 |
Amendment
|
No
amendment or other modification of this Agreement shall be effective unless
the
same shall be in writing and signed by an authorized representative of both
parties, and then such amendment or other modification shall be an integral
part
of, and have the same effectiveness as, this Agreement.
| 12.8 |
Assignment
|
|
Neither
party may assign any of its rights and/or obligations under this
Agreement
without the prior written consent of the other party. Subject to
the
preceding sentence, this Agreement will apply to, be binding in all
respects upon, and inure to the benefit of, the successors, heirs,
personal representatives, executors and permitted assigns of the
parties.
|
| 12.9 |
Severability
|
|
Where
any provision of this Agreement is subject to dispute or is determined
by
a competent court, arbitral body or government organization to be
invalid
or unenforceable, the remainder of this Agreement shall continue
in full
force and effect.
|
| 12.10 |
Cost
and Expense
|
|
Except
as otherwise expressly set forth herein or in any related documents,
all
fees, costs and expenses incurred in connection with the negotiation,
execution, delivery and performance of this Agreement and the Transaction
Documents shall be paid by the party or parties incurring such fees,
costs
or expenses.
|
[The
space below is intentionally left blank.]
Cooperation
Agreement
-
21
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[Reference
Translation]
IN
WITNESS WHEREOF,
the
parties hereto have duly executed this Agreement on the date first above
written.
China
Broadband Limited
By:
Name:
Yue, Pu
Title:
Authorized Representative
Jinan
Guangdian Jiahe Digital Television Co., Ltd.
By:
Name:
Jiang Bing
Title:
Legal Representative
Company
Seal:
Cooperation
Agreement
-
22
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[Reference
Translation]
Schedule
A
List
of Assets
Cooperation
Agreement
-
23
-
[Reference
Translation]
Schedule
B
List
of Party B’s Key Staff
Cooperation
Agreement
-
24
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[Reference
Translation]
Schedule
C
List
of Governmental Authorizations
| 1. |
Operating
Permit for Value-added Telecoms Business (Information services)
(增值电信业务经营许可证（信息服务业务）);
|
| 2. |
Operating
Permit for Value-added Telecoms Business (Internet access services)
(增值电信业务经营许可证（因特网接入服务业务）);
|
| 3. |
Operating
Permit for Radio and Television Program Transmission Services
(广播电视节目传送业务经营许可证); and
|
| 4. |
Operating
Permit for Radio and Television Program Production (广播电视节目制作经营许可证).
|
Cooperation
Agreement
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25
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