EXHIBIT 4.68
THIS IS AN ENGLISH TRANSLATION OF THE ORIGINAL CONTRACT.
AGREEMENT
PARTY A: GUANGDONG PEOPLE'S BROADCASTING STATION
PARTY B: GUANGZHOU SINGSHINE COMMUNICATION CO., LTD.
Guangdong People's Broadcasting Station ("PARTY A") and Guangzhou Singshine
Communication Co., Ltd. ("PARTY B") hereby enter into this Agreement in
accordance with the applicable laws and regulations of China and through
friendly negotiations, with respect to be integrated marketing of programs and
operating Party A's channel of Guangzhou FM107.6 (Dongguan FM102 and Zhanjiang
FM107.5) (hereinafter referred to as "ENTERTAINMENT AND SPORTS CHANNEL" or
"CHANNEL") and with the terms and conditions as follows:
ARTICLE 1 SCOPE OF COOPERATION
1.1 Both parties shall cooperate with each other to plan and provide the
programs of the Entertainment and Sports Channel, to enhance the rate of
audience and market share and to increase the income of the Channel.
1.2 Both parties shall work together to build the good image of the
Entertainment and Sports Channel, and for that purpose, Party B shall act as the
exclusive agent for the advertising operation of the Channel.
ARTICLE 2 TERM OF COOPERATION
2.1 The term of pilot operation of this Agreement shall be as from the date when
this Agreement is executed to the date of December 31, 2006. Upon expiry of the
pilot operation, both parties will sign a final contract, if both parties have
no objection.
2.2 The duration of cooperation between both parties shall be 96 months, as from
January 1, 2007 to December 31, 2014.
ARTICLE 3 CONDITIONS OF COOPERATION
3.1 Both parties must ensure that all programs of the Channel have the right
guidance of public opinion and ensure the positioning of the Channel as
established by Party A. Party A shall have the rights and powers to finally
review and approve all programs (including programs and advertisements).
3.2 Management of advertisements on the Channel shall be subject to the policy
of Party A that "being operated by each channel and being centrally managed by
headquarter". When ensuring the independence of advertisement operation
companies, all advertisements are to be centrally managed with the respect of
price, discount, author's remuneration, contracts and financial affairs.
3.3 During the term of this Agreement, Party B must timely pay the advertisement
fees to the Channel according to the total time scale of advertisements
purchased by Party B (refer to Article 4.2).
3.4 As the exclusive advertising agent of the Channel, Party B may directly sign
contracts with customers, provided that the contents of such contracts may not
conflict with the contents hereof. Party B shall submit the copy of such
contracts to Party A for reference, so that both parties may confirm the
schedule of advertisements to be broadcast.
3.5 Party B hereby acknowledges and confirms Party A's rights and obligations
under the contracts signed by Party A with any third parties prior to
effectiveness of this Agreement. With respect to those contracts whereby Party A
has received the payment of advertisement fees but which are not fully
performed, Party B shall succeed Party A in exercising the rights and performing
the obligations thereunder. Where any third party fails to pay any amount due
and payable under any contract signed by Party A before effectiveness of this
Agreement, if said contract is being performed, Party B may, with the
authorization of Party A, recover the amount from the third party and the amount
shall be deemed as Party B's income.
3.6 In order to encourage Party B to continue carrying out advertising operation
upon expiration of this Agreement, if Party B successfully collected the amounts
of advertisement fees before the due date of those cash-paying advertisement
contracts within the term of this Agreement, Party B may receive a commission at
50% of the said amounts thereunder. For those amounts collected thereunder after
expiration of this Agreement, Party A will pay the commission to Party B
according then effective commission rate. Additionally, if any non cash-paying
advertisement contract signed for the purpose of promoting the Channel, such as
those contracts with goods exchange, media exchange and channel exchange as
consideration, is not fully performed within the term of this Agreement, such
contract shall be performed within one year upon expiration of this Agreement.
After the one year's period, Party B is not entitled to any compensation
thereunder.
ARTICLE 4 COST OF ANNUAL ADVERTISEMENT TIME
4.1 The scope of advertisements operated by Party B includes medical
advertisements, charity advertisements, commercial advertisements and other
advertisements occupying resources of the Channel. The distribution of time
resources for medical
programs shall be determined by the Guangdong People's Broadcasting Station
based on the principles of equality and fairness. Party B hereby undertakes that
all incomes derived from the advertisements and activities of the Channel will
be consolidated into Party A's financial statements. The total revenue in the
initial year shall not be less than RMB 20,000,000, and it shall be increased at
least 10% in each year. For the 4th year during the term of this Agreement, the
total sales amount derived from commercial advertisements (other than medical
advertisements) shall account for 50% or more in the total sales amount of all
advertisements. (For the purpose of this article, "medical advertisement" shall
mean a program with its length more than one minute and is jointly made by an
institution and the station with respect to medical diagnosis, medicines, medial
devices, plastic surgeries and other relevant contents. )
4.2 During the term of this Agreement, Party B shall pay the following
advertisement fees to Party A in each year:
4.2.1 Initial year (i.e. 2007): the advertisement fee shall be RMB 5,200,000
(Five Million Two Hundred Thousand Yuan). From the second year, the annual
advertisement fee shall be increased according to two base amounts. For the
first part, the advertisement fee shall be increased at 10% on the base amount
of previous year (the base amount of the initial year is RMB 4,000,000, and the
base amount of the subsequent years includes the increased part), on a yearly
basis. For the second part, the advertisement fee shall be increased at 5% on
the base amount of previous year (the base amount of the initial year is RMB
1,200,000, and the base amount of the subsequent years includes the increased
part), on a yearly basis.
4.2.2 Party B shall accept and employ all temporary staff members of the Channel
according to the applicable laws and regulations. Party B shall at its own costs
produce all programs, and unconditionally and strictly comply with all rules and
regulations of Party A relating to management of programs. Party A shall provide
radio announcers, and ensure the normal and safe broadcasting of all programs on
the Channel.
ARTICLE 5 CONTRACT PRICE AND SHARING OF PROFITS
5.1 Party B shall pay a total amount of RMB 500,000 in the initial year on
January 1, 2007 (i.e. an amount of RMB 100,000 per year) to Party A as the
annual security deposit. If Party B successfully achieves the annual
advertisement revenue target, Party A shall refund the annual security deposit
of the previous year (RMB 100,000 per year) to Party B without interest at the
beginning of the next year (on or before January 15th). In the sixth year of
this Agreement, Party B shall pay an additional amount of RMB 300,000 to Party A
on January 1, 2012. If Party B successfully achieves the annual advertisement
revenue target, Party A shall refund the annual security deposit of the previous
year (RMB 100,000 per year) to Party B without interest at the beginning of the
next year (on or before January 15th) as from 2013.
5.2 Party B shall pay the monthly advertisement fee to Party A on or before the
15th day of each month. From January to December of a year, Party B shall pay
the monthly advertisement fee in the following rates according to the up-down
trends of advertising business and distribution of marketing funds: 6%, 7%, 7%,
8%, 8%, 8%, 8%, 9%, 9%, 10%, 10% and 10%. Upon receipt of the monthly
advertisement fee from Party B, Party A shall issue a corresponding invoice to
Party B on the same day.
5.3 If Party B fails to pay the aforesaid monthly advertisement fee before the
15th day of a month, it shall pay an overdue fine to Party A at 1% of the due
and payable amount on a daily basis. If Party B still fails to pay the monthly
advertisement fee on the 25th day of current month, Party A may terminate this
Agreement. For the defaulted amount, overdue fine and other losses, Party A may
directly deduct the same from the security deposit paid by Party B. If this
Agreement is terminated due to any fault of Party B, Party A may retain the
security deposit.
5.4 During the term of this Agreement, if Party A intends to use any
advertisement time section purchased by Party B exchange goods with any third
party, then 50% of proceeds from such goods exchange shall belong to Party B.
5.5 Party B hereby agrees that, when it carries out the business of all
telecommunication interactive value-added services, such as SMS, MMS, coloring
ringback tone, IVR and WAP, according to the rules and policies of Party A, it
will use the platform designated by Guangdong Teamnet Co., Ltd. ("TEAMNET
COMPANY"). The profits derived from such services shall be distributed between
Party B and Teamnet Company at the proportion of 50%:50%. Upon receipt of the
settled payment from the telecommunication operators for a specific month,
Teamnet Company shall pay the profit distribution to Party B within five
business days, and provide the list of data flow to Party B for checking.
5.6 Party B hereby agrees that, when it establishes a website for the Channel
according to the rules and policies of Party A, it will use the host platform
designated by Teamnet Company and pay the relevant host and technical support
service fees. The rules and procedures for management of programs on the Channel
shall be applied in the management of website contents, and all website contents
shall be subject to the final review and approval of Party A.
ARTICLE 6 FORM OF COOPERATION
6.1 The "General Operation Manager" of the Channel shall be appointed by Party A
and the "Vice General Operation Manager" shall be appointed by Party B, to
facilitate the daily communication and cooperation with respect to the Channel
and to specify the duties and authorities of both parties. They shall be
respectively responsible for formulation of program and operation policies,
coordination, management and monitoring of the Channel and all departments of
the Station.
6.2 The annual advertisement operation plan shall be proposed by Party B and
shall be confirmed and jointly implemented by the General Operation Manager.
6.3 Advertisement and Promotion:
6.3.1 During the pilot operation of this Agreement, Party B shall put in funds
to carry out large-scale promotional activities for the benefits of the Channel,
to advertise the Channel and provide goods programs for the Channel. As
compensation to Party B, Party B may sell commercial advertisements on the
Channel from October 2006 at 50% of the quoted price and may receive a
commission at 15% of the total advertisement revenue, in addition to
compensation at 35% of the program production costs.
6.3.2 During the term of this Agreement, Party B shall prepare the annual
advertisement plan within the last quarter of each year and ensure the annual
advertisement for the Channel, including promotional activities, channel
construction, media exchange and theme restaurants.
6.3.3 During the term of this Agreement, Party B shall be responsible for
overall brand promotion and planning of the Channel. Party B shall be fully
responsible for the exchange of advertisements with other media, channels and
other partners and vendors.
6.4 Party B shall be responsible for establishing an advertisement operation
team, and may market, plan and produce advertisements in the name of general
advertisement agent of the Channel.
6.5 Both parties shall respectively appoint some persons to coordinate the
filing of advertisement contracts and to participate in the promotion of the
Channel, and edition and management of programs and advertisement tapes.
ARTICLE 7 PERFORMANCE OF THIS AGREEMENT
7.1 All programs (including medical programs) shall be provided by Party B,
which must include sports news three times a day (no more than 1.5 minutes for
each time). Such programs must be in compliance with the applicable state laws,
regulations and policies regarding advertisements, and Party A may have the
right to decide the contents of programs, broadcasting of programs and
scheduling of advertisements.
7.2 Costs relating to the live studio:
Party B shall at its own costs provide the normal telecommunication of the live
studio, including internet and telephone. If Party B opens an outdoors live
studio, it shall at its own costs maintain and repair all equipment required for
operation of the said
outdoors live studio. With respect to the equipment required for normal
operation of the live studio, it is agreed that:
7.2.1 For any equipment added due to Party B's demand, Party B shall at its own
costs maintain such equipment;
7.2.2 If any equipment is damaged due to improper or mistaken operation of Party
A's or Party B's anchorman, the responsible party shall at its own costs repair
or replace the equipment;
7.2.3 The costs for maintenance and updating of original equipment shall be
firstly paid from the maintenance fund of the Channel, and the amount in short
shall be paid by Party B. For this purpose, Party A shall submit the financial
record of the maintenance fund of the previous quarter to Party B at the
beginning of each quarter, and the quarterly financial record shall be signed by
both parties for confirmation;
7.2.4 The costs for transmission and coverage of signals of the Channel shall be
paid by Party A.
7.3 During the term of this Agreement, the song, logo and slogan of the Channel
designed by Party B shall be subject to the final review and approval of Party
A, and the copyright thereof shall be jointly owned by both parties. Without
prior approval of both parties, neither party may use the same for any purpose
other than for the programs and activities of the Channel. After expiration or
termination of this Agreement, the copyright thereof shall be exclusively owned
by Party A.
ARTICLE 8 RIGHTS AND OBLIGATIONS OF BOTH PARTIES
8.1 Party A's Rights and Obligations
8.1.1 Within five business days upon receipt of all suggestions and proposals of
Party B regarding the development of the Channel, including overall positioning,
promotional plan, contents of programs, schedule of programs, advertisement
operation plan, contents and price of advertisements, advertisement contracts,
distribution of time for advertisements, as well as all activities sponsored or
participated in the name of the Channel, Party A shall give its decision to
Party B. If Party A disapproves any content, it shall give a reasonable written
notice to Party B to explain the reason. Where Party A fails to give a reply
within the prescribed time period, it shall be deemed that Party A has accepted
all contents.
8.1.2 Party A shall ensure the frequency modulation of the Channel will meet the
relevant state requirements for broadcasting industry before December 31, 2006.
8.1.3 Party A shall ensure the normal broadcasting all approved programs and
advertisements.
8.1.4 Party A shall provide Party B with a broadcasting certificate for all
advertisements broadcast on the Channel.
8.1.5 When the quarterly rate of audience is declared, Party A shall timely
provide Party B with all information and data about audience investigation, as
well as relevant monitoring reports.
8.1.6 Party A shall provide the program schedule of other channels owned by it,
and shall broadcast all advertisements on the Channel according to the schedule
arranged by Party B. The total time scale of such programs may be exchanged with
other channels on an equal basis.
8.1.7 In order to facilitate Party B's business operation, Party A hereby agrees
to broadcast an image promotion advertisement for Party B and a recruitment
advertisement of program planning/anchors and advertisement marketing persons on
the Channel (FM107.6). During the term of this Agreement, the total time scale
of such advertisements shall be five times a day and thirty seconds a time.
8.2 Party B's Rights and Obligations
8.2.1 Party B shall comply with all applicable state laws and regulations
regarding advertisement operation, as well as the policies and rules of Party A,
and shall abide by the right guidance of public opinion. Party B shall comply
with Party A's rules and policies regarding secure broadcasting of programs, and
shall be subject to the supervision and punishment of Party A.
8.2.2 Party B may propose the rate of advertisement price for the Channel and
shall implement such rate when the same is approved by Party A. The rate of
discount for customers shall be subject to Article 3.2 of this Agreement.
8.2.3 When the rate of audience of the Channel is increased and it is to attract
other advertisement agents interested in, Party B shall be fully responsible for
contact with such agents and identify their qualification. The authorization
letter to such agents shall be jointly issued by both parties. Other contracts
or agreements signed by Party B and other advertisement agents shall be subject
to the written approval or confirmation of Party A, as the case may be.
8.2.4 Party B may broadcast its image promotional advertisement on other
channels owned by Party A (or designated by Party A) (with the agreement of
other channels, to exchange the time of advertisements of other channels on an
equal basis).
8.2.5 Party B shall at its own costs employ program production professionals and
advertisement operation professionals, to ensure the normal broadcasting of
programs and normal operation of advertisements on the Channel.
8.2.6 Party B hereby undertakes that it will not produce or operate any other
brand programs and activities which are being produced and operated by Party A's
channels.
ARTICLE 9 LIABILITIES FOR BREACH OF CONTRACT
9.1 If either party makes any untrue statement, guaranty or commitment hereunder
or fails to fully perform its obligations hereunder, it shall be deemed as a
breach of contract. The breaching party shall be subject to the liabilities for
breach of contract as stipulated herein.
9.2 If either party materially breaches this Agreement, the non-breaching party
may terminate this Agreement and the breaching party shall indemnify the
non-breaching party against all losses and damages incurred therefrom.
9.3 If Party B or its anchorman or operation representative violates any
applicable state law, regulation or rule regarding radio broadcasting or
advertisement operation, Party A may immediately terminate this Agreement, and
Party B shall be subject to the liabilities for breach of Contract and indemnify
Party A against all losses incurred therefrom.
9.4 If Party A or its employee violates any applicable state law, regulation or
rule regarding radio broadcasting or advertisement operation, which adversely
affects the performance of this Agreement or causes any loss to Party B, Party B
may immediately terminate this Agreement, and Party A shall be subject to the
liabilities for breach of Contract, shall indemnify Party B against all losses
incurred therefrom and shall immediately and fully refund the security deposit
to Party B.
9.5 If Party B fails to achieve the agreed minimum advertisement revenue amount
or the advertisement revenue target due to any fault of Party A and so this
Agreement is terminated, Party A shall indemnify Party B against all losses
incurred therefrom and fully refund the security deposit to Party B.
9.6 If this Agreement is terminated without any fault of both parties, both
parties shall settle the subsequent issues through friendly negotiations.
ARTICLE 10 RENEWAL AND MISCELLANEOUS
10.1 Under the equivalent conditions, Party B shall have the priority right to
renew this Agreement upon expiration of this Agreement.
10.2 Upon expiration or termination of this Agreement, both parties shall agree
upon a
solution for all programs are being broadcast or are decided but yet to be
broadcast, through friendly negotiations.
ARTICLE 11 FORCE MAJEURE
If this Agreement or any obligation hereunder is unable to be fully or timely
performed due to any government act, order of reformation given by any relevant
authority, political or military cause or any other unforeseeable, inevitable or
uncontrollable event, it shall not be deemed as a breach of contract and both
parties are not liable to each other. However, the party alleging an event of
force majeure shall timely provide the other party with a valid certificate
issued by government agency or notary office, and shall take effective actions
to avoid additional losses; otherwise, it shall be liable for all additional
losses resulting therefrom. The notified party shall take effective actions to
avoid additional losses; otherwise, it may not claim compensation for such
additional losses.
ARTICLE 12 SETTLEMENT OF DISPUTE
Any issue absent hereof shall be settled by both parties through friendly
negotiations and specified in an agreement supplementary hereto. In case no
settlement can be reached, the issue shall be submitted to Guangzhou Arbitration
Committee for arbitration.
ARTICLE 13 EFFECTIVENESS
This Agreement shall enter into force as of the date when the same is duly
signed and sealed by both parties hereto.
This Agreement shall be made in four (4) originals, two (2) for each party
hereto and each being of equal legal force.
PARTY A: GUANGDONG PEOPLE'S BROADCASTING STATION ENTERTAINMENT & SPORTS DIVISION
(with Company seal)
Legal Representative: /s/
Date: November 1, 2006
PARTY B: GUANGZHOU SINGSHINE COMMUNICATION CO., LTD. (with Company seal)
Legal Representative: /s/
Date: November 1, 2006