EXHIBIT 10.24
EQUITY INTERESTS PLEDGE AGREEMENT
This Equity Interests Pledge Agreement (the "Agreement") is entered into on the
day of 27 November, 2003 by and between the following parties:
Pledgee: Shanghai Huitong Information Co., Ltd.
Address: Xx.00, Xxxxx Xxxx, Xxxxxxx Xxxxxxxx, Xxxxxxxx
Pledgor: Shanghai Weilan Computer Co., Ltd.
Address: Xx.000, Xxxxxxxxxxxxx Xxxx Xxxx, Xxxxxxx Xxxxxxxx, Xxxxxxxx
WHEREAS,
1. Shanghai Weilan Computer Co., Ltd, the Pledgor, is the citizen of the
People's Republic of China ("PRC"). The Pledgor owns 90% of the equity
interest in Shanghai Unilink Computer Co., Ltd. Shanghai Unilink
Computer Co., Ltd ("Shanghai Unilink") is a limited liability company
registered in Shanghai.
2. The Pledgee, a wholly foreign-owned company registered in Shanghai,
PRC, has been licensed by the PRC relevant government authority to
carry on the business of Internet technical service. The Pledgee and
the Pledgor-owned Shanghai Unilink enter into Exclusive Technical
Consulting and Services Agreement (the "Service Agreement") .
3. In order to make sure that the Pledgee collect technical service fees
as normal from Shanghai Unilink, the Pledgor is willing to pledge all
its equity interest in Shanghai Unilink to the Pledgee as a security
for the Pledgee to collect technical consulting and service fees under
the Service Agreement.
In order to define each Party's rights and obligations, the Pledgee and
the Pledgor through mutual negotiations hereby enter into this
Agreement based upon the following terms:
1. Definitions and Interpretations
Unless otherwise provided in this Agreement, the following terms shall have the
following meanings:
1.1 Pledge means the full content of Article 2 hereunder
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1.2 Equity Interest means all its 90% equity interests in Shanghai
Unilink legally held by the Pledgor.
1.3 Rate of Pledge means the ratio between the value of the pledge
under this Agreement and the exclusive technical consulting
and service fees under the Service Agreement.
1.4 Term of Pledge means the period provided for under Article 3.2
hereunder.
1.5 Service Agreement means the Exclusive Technical Consulting and
Service Agreement entered into by and between Shanghai Unilink
and the Pledgee .
1.6 Event of Default means any event in accordance with Article 7
hereunder.
1.7 Notice of Default means the notice of default issued by the
Pledgee in accordance with this Agreement.
2. Assignment And Pledge
2.1 The Pledgor agrees to pledge all its equity interest in
Shanghai Unilink to the Pledgee as guarantee for the technical
consulting service fee payable to the Pledgee under the
Service Agreement.
2.2 Pledge under this Agreement refers to the rights owned by the
Pledgee who shall be entitled to have priority in receiving
payment by the evaluation or proceeds from the auction or sale
of the equity interests pledged by the Pledgor to the Pledgee.
3. Rate of Pledge and Term of Pledge
3.1 The rate of Pledge
3.1.1 The rate of pledge shall be 100%
3.2 The term of Pledge
3.2.1 The Pledge shall take effect as of the date when the
equity interests under this Agreement are recorded in
the Register of Shareholder of Shanghai Unilink and
registered with the competent Administration for
Industry and Commerce. The term of the Pledge is the
same with the term of Service Agreement.
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3.2.2 During the Pledge, the Pledgor shall be entitled to
dispose the Pledge in accordance with this Agreement
in the event that Shanghai Unilink fails to pay
exclusive technical Consulting and service fee in
accordance with the Service Agreement.
4. Physical Possession of Documents
4.1 During the term of Pledge under this Agreement, the Pledgor
shall deliver the physical possession of the Certificate of
Distribution and the Name List of Shareholder of Shanghai
Unilink to the Pledgee within one week as of the date of
conclusion of this Agreement.
4.2 The Pledgee shall be entitled to collect the dividends from
the equity interests.
5. Warranties and Representations of the Pledgor
5.1 The Pledgor is the legal owner of the equity interests.
5.2 The Pledgee shall not be interfered by any parties at any time
when the Pledge exercises its rights in accordance with this
Agreement.
5.3 The Pledgee shall be entitled to dispose or assign the pledge
in accordance with this Agreement.
5.4 The Pledgor does not pledge or encumber the equity interests
to any other person except for the Pledgee.
6. Covenant of the Pledgor
6.1 During the effective term of this Agreement, the Pledgor
covenants to the Pledgee that the Pledgor shall:
6.1.1 Except the transfer of equity interest, as subject to
the Exclusive Purchase Right Contract entered into
among the Pledgor, Linktone Ltd and Shanghai Unilink,
to Linktone Ltd or the person designated by Linktone
Ltd, not transfer or assign the equity interests,
create or permit to create any pledges which may have
an adverse effect on the rights or benefits of the
Pledgee without prior written consent from the
Pledgee;
6.1.2 Comply with and implement laws and regulations with
respect to the
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pledge of rights, present to the Pledgee the notices,
orders or suggestions with respect to the Pledge
issued or made by the competent authority within five
days upon receiving such notices, orders or
suggestions and comply with such notices, orders or
suggestions, or object to the foregoing matters at
the reasonable request of the Pledgee or with consent
from the Pledgee.
6.1.3 Timely notify the Pledgee of any events or any
received notices which may affect the Pledgor's
equity interest or any part of its right, and any
events or any received notices which may change the
Pledgor's any covenant and obligation under this
Agreement or which may affect the Pledgor's
performance of its obligations under this Agreement.
6.2 The Pledgor agrees that the Pledgee's right of exercising the
Pledge obtained from this Agreement shall not be suspended or
hampered through legal procedure by the Pledgor or any
successors of the Pledgor or any person authorized by the
Pledgor or any other person.
6.3 The Pledgor warrants to the Pledgee that in order to protect
or perfect the security over the payment of the technical
consulting and service fees under the Service Agreement, the
Pledgor shall execute in good faith and cause other parties
who have interests in the pledge to execute all the title
certificates, contracts, and or perform and cause other
parties who have interests to take action as required by the
Pledgee and make access to exercise the rights and
authorization vested in the Pledgee under this Agreement, and
execute all the documents with respect to the changes of
certificate of equity interests with the Pledgee or the
person(natural person or legal entity) designed by the
Pledgee, and provides all the notices, orders and decisions
regarded as necessary by the Pledgee with the Pledgee within
the reasonable time.
6.4 The Pledgor warrants to the Pledgee that the Pledgor will
comply with and perform all the guarantees, covenants,
agreements, representations and conditions for the benefits of
the Pledgee. The Pledgor shall compensate all the losses
suffered by the Pledgee for the reasons that the Pledgor does
not perform or fully perform their guarantees, covenants,
agreements, representations and conditions.
7. Events of Default
7.1 The following events shall be regarded as the event of
default:
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7.1.1 Shanghai Unilink fails to make full payment of the
exclusive technical consulting and service fees as
scheduled under the Service Agreement;
7.1.2 The Pledgor makes any material misleading or
fraudulent representations or warranties under
Article 5 herein, and/or the Pledgor is in violation
of any warranties under Article 5 herein;
7.1.3 The Pledgor violates the covenants under Article 6
herein;
7.1.4 The Pledgor violates any terms and conditions herein;
7.1.5 The Pledgor waives the pledged equity interests or
transfers or assigns the pledged equity interests
without prior written consent of the Pledgee, except
as provided in Article 6.1.1 in this Agreement;
7.1.6 The Pledgor's any external loan, security,
compensation, covenants or any other compensation
liabilities (1) are required to be repaid or
performed prior to the scheduled date; or (2) are due
but can not be repaid or performed as scheduled and
thereby cause the Pledgee to deem that the Pledgor's
capacity to perform the obligations herein is
affected;
7.1.7 The Pledgor is incapable of repaying the general debt
or other debt;
7.1.8 This Agreement is illegal for the reason of the
promulgation of the related laws or the Pledgor's
incapability of continuing to perform the obligations
herein;
7.1.9 Any approval, permits, licenses or authorization from
the competent authority of the government needed to
perform this Agreement or validate this Agreement are
withdrawn, suspended, invalidated or materially
amended;
7.1.10 The property of the Pledgor is adversely changed and
cause the Pledgee deem that the capability of the
Pledgor to perform the obligations herein is
affected;
7.1.11 The successors or assignees of the Shanghai Unilink
are only entitled to perform a portion of or refuse
to perform the payment liability under the Service
Agreement;
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7.1.12 Other circumstances whereby the Pledgee is incapable
of exercising the right to dispose the Pledge in
accordance with the related laws.
7.2 The Pledgor shall immediately give a written notice to the
Pledgee if the Pledgor is aware of or find that any event
under Article 7.1 herein or any events that may result in the
foregoing events have happened or is going on.
7.3 Unless the event of default under Article 7.1 herein has been
solved to the Pledgee's satisfaction, the Pledgee, at any time
when the event of default happens or thereafter, may give a
written notice of default to the Pledgor and require the
Pledgor to immediately make full payment of the outstanding
service fees under the Service Agreement and other payables or
dispose the Pledge in accordance with Article 8 herein.
8. Exercise Of The Right Of The Pledge
8.1 The Pledgor shall not transfer or assign the pledge without
prior written approval from the Pledgee prior to the full
repayment of the consulting and service fee under the Service
Agreement.
8.2 The Pledgee shall give a notice of default to the Pledgor when
the Pledgee exercises the right of pledge.
8.3 Subject to Article 7.3, the Pledgee may exercise the right to
dispose the Pledge at any time when the Pledgee gives a notice
of default in accordance with Article 7.3 or thereafter.
8.4 The Pledgee is entitled to have priority in receiving payment
by the evaluation or proceeds from the auction or sale of
whole or part of the equity interests pledged herein in
accordance with legal procedure until the outstanding
consulting and service fees and all other payables under the
Service Agreement are repaid.
8.5 The Pledgor shall not hinder the Pledgee from disposing the
Pledge in accordance with this Agreement and shall give
necessary assistance so that the Pledgee could realize his
Pledge.
9. Transfer or Assignment
9.1 The Pledgor shall not donate or transfer his rights and
obligations herein without prior consent from the Pledgee.
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9.2 This Agreement shall be binding upon the Pledgor and his
successors and be effective to the Pledgee and his each
successor and assignee.
9.3 The Pledgee may transfer or assign his all or any rights and
obligations under the Service Agreement to any individual
(natural person or legal entity) at any time. In this case,
the assignee shall enjoy and undertake the same rights and
obligations herein of the Pledgee as if the assignee is a
party hereto. When the Pledgee transfers or assigns the rights
and obligations under the Service Agreement, at the request of
the Pledgee, the Pledgor shall execute the relevant agreements
and/or documents with respect to such transfer or assignment.
9.4 After the Pledgee's change resulting from the transfer or
assignment, the new parties to the pledge shall reexecute a
pledge contract.
10. Termination
This Agreement shall not be terminated until the consulting and service fees
under the Service Agreement are paid off and the Shanghai Unilink will not
undertake any obligations under the Service Agreement any more, and the Pledgee
shall cancel or terminate this Agreement within reasonable time as soon as
practicable.
11. Formalities Fees And Other Charges
11.1 The Pledgor shall be responsible for all the fees and actual
expenditures in relation to this Agreement including but not
limited to legal fees, cost of production, stamp tax and any
other taxes and charges. If the Pledgee pays the relevant
taxes in accordance with the laws, the Pledgor shall fully
indemnify such taxes paid by the Pledgee.
11.2 The Pledgor shall be responsible for all the fees (including
but not limited to any taxes, formalities fees, management
fees, litigation fees, attorney's fees, and various insurance
premiums in connection with disposition of Pledge) incurred by
the Pledgor for the reason that (1) The Pledgor fails to pay
any payable taxes, fees or charges in accordance with this
Agreement; or (2) The Pledgee has recourse to any foregoing
taxes, charges or fees by any means for other reasons.
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12. Force Majeure
12.1 If this Agreement is delayed in or prevented from performing
in the Event of Force Majeure ("Event of Force Majeure"), only
within the limitation of such delay or prevention, the
affected party is absolved from any liability under this
Agreement. Force Majeure, which includes acts of governments,
acts of nature, fire, explosion, typhoon, flood, earthquake,
tide, lightning, war, means any unforeseen events beyond the
prevented party's reasonable control and cannot be prevented
with reasonable care. However, any shortage of credit, capital
or finance shall not be regarded as an event beyond a Party's
reasonable control. The Pledge effected by Force Majeure who
claims for exemption from performing any obligations under
this Agreement or under any Article herein shall notify the
other party of such exemption promptly and advice him of the
steps to be taken for completion of the performance.
12.2 The party affected by Force Majeure shall not assume any
liability under this Agreement. However, subject to the party
affected by Force Majeure having taken its reasonable and
practicable efforts to perform this Agreement, the party
claiming for exemption of the liabilities may only be exempted
from performing such liability as within limitation of the
part performance delayed or prevented by Force Majeure. Once
causes for such exemption of liabilities are rectified and
remedied, both parties agree to resume performance of this
Agreement with their best efforts.
13. Dispute Resolution
13.1 This Agreement shall be governed by and construed in
accordance with the PRC law.
13.2 The parties shall strive to settle any dispute arising from
the interpretation or performance, or in connection with this
Agreement through friendly consultation. In case no settlement
can be reached through consultation, each party can submit
such matter to China International Economic and Trade
Arbitration Commission ("CIETAC") for arbitration. The
arbitration shall follow the current rules of CIETAC, and the
arbitration proceedings shall be conducted in Chinese and
shall take place in Shanghai. The arbitration award shall be
final and binding upon the parties.
14. Notice
14.1 Any notice which is given by the parties hereto for the
purpose of performing
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the rights, duties and obligations hereunder shall be in
writing. Where such notice is delivered personally, the time
of notice is the time when such notice actually reaches the
addressee; where such notice is transmitted by telex or
facsimile, the notice time is the time when such notice is
transmitted. If such notice does not reach the addressee on
business date or reaches the addressee after the business
time, the next business day following such day is the date of
notice. The delivery place is the address first written above
of the parties hereto or the address advised in writing
including facsimile and telex from time to time.
15. Appendices
15.1 The appendices to this Agreement are entire and integral part
of this Agreement.
16. Effectiveness
16.1 This agreement and any amendments, modification, supplements,
additions or changes hereto shall be in writing and come into
effect upon being executed and sealed by the parties hereto.
16.2 This Agreement is executed in both Chinese and English forms,
and in case of conflicts, the Chinese version shall prevail.
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The Pledgee: Shanghai Huitong Information Co., Ltd.
Authorized Representative: /s/ Xxx Xx
The Pledgor: Shanghai Weilan Computer Co., Ltd.
Authorized Representative: /s/ Xxxxxxx Xxx Xxxx
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EXHIBIT A
1. Register of Shareholders of Shanghai Unilink Computer Co., Ltd.
2. Certificate of Capital Contribution of Shanghai Unilink Computer Co.,
Ltd.
3. Exclusive Technical Consulting and Services Agreement
