EXHIBIT 10.24
AGREEMENT
This Agreement is entered into as of October 15, 2003 by and among Shanghai
On-target Advertising Co., Ltd. (with a registered capital RMB500,000), a
company incorporated and existing under the laws of China ("ON-TARGET"), Xxxxx
Xxx Xx (a shareholder of On-target, with 70% shares), Shanghai Focus Media
Advertisement Co., Ltd. (a shareholder of On-target, with 30% shares), Union
Enterprise Holding Limited, a company incorporated and existing under the laws
of Hong Kong ("UNION") and Lin Shenlong.
On the principle of mutual benefits and interests, the Parties hereby agree as
follows:
1. Union will be granted a warrant of 40% of On-target shares (such 40%
shares to be transferred from Xxxxx Xxx Xx). The consideration for the
acquisition of the shares shall be the surface value of the shares
(RMB200,000).
2. Transfer of the Shares
2.1 (1) Unless pursuant to the detailed rules of the Articles of Association
[of On-target] and the provisions hereof, Union may not sell,
transfer, mortgage, pledge, grant futures or other interests thereof,
or otherwise dispose of its legal or substantive ownership to the
On-target shares under its name.
(2) In this Article 2, the term "transfer" shall include, but not be
limited to, sales or otherwise disposal of the On-target shares and
interests thereof, and execution of any agreement with others in
respect of the exercise of the voting rights of On-target shares
(other than this Agreement and any supplementary agreements hereto).
2.2 The transfer of the On-target shares shall be subject to the following
provisions:
(1) In case that any shareholder of On-target (the "OFFERER") wishes to
sell, transfer or otherwise dispose of all or part of its On-target
shares, except otherwise stipulated in Article 2.2(2), the Offerer
shall first seek the agreement thereto of all other shareholders of
On-target (the "REMAINING Shareholders"), giving in details the
number of shares to be transferred (the "TRANSFERRED SHARES"), the
name of the proposed transferee and the offered price per share (the
"OFFERED PRICE").
(2) In case that the Offerer fails to obtain the agreement to the
transfer as required under Article 2.2(1), but it obtains the
agreement to the transfer from some of the Remaining Shareholders
(who shall own at least 51% of On-target's issued and outstanding
shares), then those disagreeing shareholders (the "DISAGREEING
SHAREHOLDERS") of the Remaining
Shareholders shall purchase the Transferred Shares from the Offerer
at the Offered Price.
3. Union acknowledges that Lin Shenlong is, as a shareholder of On-target,
its only legal and beneficiary owner of shares in On-target.
4. Lin Shenlong and Union undertake respectively to On-target to observe the
non-competition provisions as follows:
4.1 they will not (and they also procure that their respective contacts will
not) engage in, or be employed for, any business that competes directly or
indirectly with that which On-target (including its controlling group or
affiliates) is currently engaging in, by itself or for other individuals,
companies or organizations (or any company in which they assume position
as director, employee, shareholder, agent or consultant);
4.2 they will not (and they also procure that their respective contacts will
not) invest in whatever form and whether directly, indirectly or through
other entities, in any business that is related to the business of
On-target (including its controlling group or affiliates), other than
investment in On-target;
4.3 they will not (and they also procure that their respective contacts will
not) solicit, request or seduce any person or company (i.e. On-target's
client at any time, or persons or companies having business contacts with
On-target for long) to leave their current work positions by breaking
employment contract, either for its own benefit or the benefit of other
persons, companies or organizations that compete directly or indirectly
with On-target (including its controlling group or affiliates);
4.4 they will not (and they also procure that their respective contacts will
not) seduce or try to seduce any employees, directors or administrative
personnel of On-target (including its controlling group or affiliates) to
leave their current work positions, either for its own benefit or the
benefit of other persons, companies or organizations; and
4.5 in relation to any trade, business or company, they will not (and they
also procure that their respective contacts will not) use any name that
might or could be confused with that of On-target (including its
controlling group or affiliates) or its products; they will also endeavor
reasonably to procure such names not to be used by any person or company.
Agreement
2
5. Confidentiality
Shareholders of On-target shall keep in confidence all commercial secrets,
technical and financial information or other information of a confidential
nature and owned by On-target and/or its controlling group, which they
become aware of as the result of execution of this Agreement. On-target
shall procure that its employees, consultants and agents will observe the
above undertakings, and shall only be able to disclose such confidential
information at the following circumstances:
(1) as required by governing laws;
(2) as required by contractual responsibilities (but with consents of
the other Parties hereof);
(3) as required by governmental authorities or supervisory institutions;
(4) disclosure to the professional consultants, auditors or banks of
On-target or Parties hereof;
(5) if the relevant information is already known to the public (not
through default of any shareholders);
(6) if such information is obtained from any third parties (which are
not in violation of any disclosure provisions);
(7) with the prior written consent of the other Parties.
Unless prohibited by relevant laws or governmental authorities or
supervisory institutions, any disclosure pursuant to (1) or (3) above
shall be subject to prior consultation with, and notice to, the other
Parties.
6. As of the date hereof, Lin Shenlong shall be appointed as the managing
director of On-target, who will also execute thereby the employment
contract and confidentiality agreement. Each of the shareholders of
On-target agrees that 20% of the net profits of On-target shall be used as
bonus for the management of On-target, which will be distributed in a
coordinated way by the managing director.
7. Default
If any shareholder of On-target (the "DEFAULT PARTY") violates materially
or successively this Agreement, and it fails to make remedy, if it is
remediable, to such default within fifteen (15) days of receipt of the
notice for it to make remedy,
Agreement
3
then any of the remaining non-default shareholders (including the
shareholder issuing the remedy notice) may issue to the Default Party a
default notice, upon receipt of which the Default Party shall be deemed as
to have sent to On-target the transfer notice set out in Article 2.2, with
the transfer price to be determined by the auditor of On-target (unless
for conspicuous errors, the determination of such auditor shall be final
and binding on the transferor and all other shareholders of On-target) and
the costs for the auditor shall be borne by the transferor.
8. This Agreement shall not be amended or cancelled.
9. This Agreement shall be construed in accordance with the laws of China,
and in case of any disputes, such disputes shall be submitted to the
arbitration center for arbitration according to the currently effective
arbitration rules.
10. This Agreement shall be effective and binding on On-target and its
successors designated by On-target's shareholders. Union shall not assign
or transfer any of its rights or obligation hereunder to others.
IN WITNESS HEREOF, this Agreement is executed as of the date first hereinabove
mentioned.
SHANGHAI ON-TARGET ADVERTISING CO., LTD. (Corporate Seal)
Signed by: /s/ Xxxxx Xxxxxxx Xxxxx
-----------------------------------------
Name: Xxxxx Xxxxxxx Xxxxx
XXXXX XXX XX
Signed by: /s/ Xxxxx Xxx Xx
-----------------------------------------
Name: Xxxxx Xxx Xx
XXX SHENLONG
Signed by: /s/ Lin Shenling
-----------------------------------------
Name: Lin Shenlong
SHANGHAI FOCUS MEDIA ADVERTISEMENT CO., LTD. (Corporate Seal)
Signed by: /s/ Xxxxx Xxxxxxx Xxxxx
-----------------------------------------
Name: Xxxxx Xxxxxxx Xxxxx
Agreement
4
UNION ENTERPRISE HOLDING LIMITED
Signed by: /s/ Xxxxx Xxx Xx
-----------------------------------------
Name: Xxxxx Xxx Xx
Agreement
5
