EXHIBIT 10.32
AMENDED UNDERSTANDING BETWEEN TENGTU CHINA AND TENGTU
INTERNATIONAL CORP. GOVERNING ACTIVITIES IN CHINA
RELATING TO OPERATION MORNING SUN, NATIONAL CENTRE FOR
AUDIO/VISUAL EDUCATION AND THE MINISTRY OF EDUCATION
1. All activities of Tengtu China, investments, agreements, contracts and
undertakings entered into with the Ministry of Education for the purposes of
Operation Morning Sun, NCAVE, China Broadband Education Resources Centre, Local
Broadband Education Resources Centres and as otherwise contemplated in the
understandings with the Ministry, will be conducted on behalf of TIC and TUC
according to the joint venture agreement.
2. Tengtu China will operate in these activities as the joint- venture partner
of TIC and all investments and revenues will be accounted for under the joint
co-operation and management of Tengtu China and Tengtu International Corp., its
controller and auditors. Tengtu China and TIC will establish systematic
reporting and access to the accounts established for the business activities
related to the Ministry of Education initiatives. This is most important for
purposes of complying with the SEC Audit Regulations.
3. Tengu's partnership in the China Education Resources Centre will be
understood to be the interest held by Tengtu China, and its affiliated
companies, on behalf of the TUC joint-venture, pursuant to the May 22, 2002
Cooperation Agreement with NCAVE. Of the percentage held by Tengtu China, and
its affiliated companies (the "TTC Interest"), 57% will be held for and assigned
to TIC(the "TIC Interest") .
4. It is the understanding of TC and TIC that both TUC parties will work towards
consolidating the joint-venture into a single operating and incorporated entity
as soon as conditions are favorable and compliance of such an undertaking can be
met under the respective jurisdictions. In the meantime, both TC and TIC will
operate on behalf of and in the interests of the TUC joint- venture, its
partners and investors.
5. TIC agrees to raise 80 Million RMB which is the planned initial capital
needed for the "Morning Sun Broadband Education Resources Centre" project to be
established jointly with the NCAVE of the Ministry of Education of China. The 80
Million RMB shall be an equity contribution to the project and shall not be a
loan from TIC to TC. In the event that TIC fails to raise 80 Million RMB by
December 31, 2003, the TIC Interest will be reduced by a percentage equal to 80
Million RMB minus the amount raised by TIC, divided by 80 Million RMB (the
"Reduction Percentage"). At no time shall TIC's interest in the China Broadband
Education Resources Centre exceed the TIC Interest minus the Reduction
Percentage
BEIJING TENGTU CULTURE & TENGTU INTERNATIONAL CORP.
EDUCATION ELECTRONCIS
DEVELOPMENT CO., LTD.
By its shareholders: By:_________________________
Xxxx Xxxx, President
Beijing Jiade Tengtu Technology Group
Co. Ltd and Beijing Oriental Tai He
Technology Development Co., Ltd.
By:______________________________
XxxXx Xxxxx
BEIJING TENGTU TIANDI NETWORK
CO., LTD.
By its shareholders:
Beijing Jiade Tengtu Technology Group
Co. Ltd and Beijing Oriental Tai He
Technology Development Co., Ltd.
By:______________________________
XxxXx Xxxxx
Xxxxxxx and restated as of April 25, 2001
