A G R E E M E N T
The Guangzhou MTR (Mass Transit Railway) Company of Guangdong, the People's
Republic of China ("China") and the Guangzhou Chuangrun Media Company Limited
based on the [Contract Law of The People's Republic of China] and other related
rules and regulations, under equal and mutual benefit basis; hereby signs the
Guangzhou MTR Lines 1 and 2 twelve station (stations named) wrapped pillar
advertising contract, for both sides to abide to.
Chapter 1 - Definitions
Item 1 For this contract and other related appendices, the definitions of the
following terms and meanings are set as follows:
1. "One side" means the Guangzhou MTR Company or the Guangzhou
Chuangrun Media Company Limited.
2. "Both sides "mean the Guangzhou MTR Company and the Guangzhou
Chuangrun Media Company Limited.
3. "This Contract" means this executed contract.
Chapter 2 - The Contract Parties
Item 2 The contract parties are:
1. The Guangzhou MTR Company (hereafter "Party A") is incorporated
under China Law and is a legal entity of good standing. Registered
at the Guangzhou Department of Commerce, number 4401011301026.
Legal Address: 219 Zhong Sang Fifth Road
Zhong Lui Building 16/F
Guangzhou, China
Legal Representative: Lu Guanglin
Position: General Manager
Nationality: Chinese
2. The Guangzhou Chuangrun Media Company Limited (hereafter "Party B")
incorporated under Chinese Law and is a legal entity of good
standing. Registered at the Guangzhou Department of Commerce, number
4401062016711.
Legal Address: 168 Jiang Nan Da Dao Zhong
Ocean Petroleum Building Room 1211
Guangzhou, China
Legal Representative: Cai Hanxiong
Position: General Manager
Nationality: Chinese
Chapter 3 - Exclusive Agent Scope
Item 3 Party B to install wrapped pillar advertising to the Guangzhou MTR Lines
1 and 2 twelve stations.
Chapter 4 - Contract Term
Item 4 The contract term for Party B to install wrapped pillar advertising to
the Guangzhou MTR Lines 1 and 2 twelve stations is 5 years. Part B will assist
Party A in applying for the initial advertising license from the Department of
Commerce; it is considered force majeure if not successful.
Chapter 5 - Scope and Scale
Item 5 Contract Scope
The scope of the co-operation is the Guangzhou MTR Lines 1 and 2 twelve
stations. 8 on Line 1 (stations named) and 4 on Line 2 (stations named). Number
of pillars depends on the actual station, between 8 to 12 pillars.
Item 6 Term
The term is 5 years from November 1, 2004 to October 31, 2009. At the end of the
term, if Party A continues to employ this format, Party B has priority under
similar terms.
Item 7 Release Contents
Party B can only release advertisements according to the Advertising Laws as
well as other Laws. All advertisements have to be legal, real and effective.
Chapter 6 - Rights and Responsibilities
Item 10 Party A's Responsibilities
1. Safety, tidiness and maintenance of the pillar ads.
2. Safety liaison and supervision of the pillar ads.
3. Annual renewal from the Department of Commerce and its cost; to
ensure that the legality of the ads.
4. Assist Party B in installation and liaison with other MTR
departments.
5. Approve each ad according to [Advertising Law of the People's
Republic of China] and inspect the contents of the ads.
Item 11 Party A's Rights
1. Make sure Part B adhere to the applicable law and rules and
regulations of the MTR. The right to approve an advertisement design
and reject any unlawful advertisement, whether it be against
advertising law, or social ethics, or detrimental to the image of
the Guangzhou MTR.
2. Receive management fees from Party B.
Item 12 Party B's Responsibilities
1. The cost of design, production, installation and other fees of the
pillar ads.
2. The operations of the pillar ads; guarantee its legality, and
independently responsible for its economic and legal consequences.
3. The cost of design, production, installation of the pillar ads; get
Party A's approval before putting the ad into production.
4. Periodically pay Party A full management fees on time.
5. Protect and care for equipment and supplies supplied by Party A,
responsible for equipment's security and maintenance.
6. Accept Party A's management, supervision and coordination. Onsite
workers to adhere to the rules and regulations of the MTR.
7. The advertising and media advertising operating rights stay with
Party B, can not be transferred or assigned.
Item 13 Party B's Rights
1. During the term of the contract, Party B can operate the business
according to market conditions and promotions.
Chapter 7 - Payment Method
Item 14 Party B will pay management fees on the 7th of that month to an account
designated by Party A, Party A will issue receipt.
1. Management fee for the MTR Line 1 and 2 pillar ad for the term of the
contract (i.e. October 31, 2009). From November 1, 2004 management fee is One
Hundred Thousand Renminbi per month (RMB 100,000).
Item 15 Within 7 days of this contract, Party B will pay One Million Two Hundred
Thousand Renminbi to Party A, as a contract deposit from B to A.
Chapter 8 - Contract Violation Responsibilities
Item 16 Party B is in violation is it does not pay the full contract deposit to
Party A within 7 days of signing this contract. Party A has the right to
terminate the contract.
Item 17 Party A is in violation if 7 days after receiving the full contract
deposit from Party B and does not deliver the advertising rights to Party B,
Party A has to return whatever payment is made together with penalties.
Item 18 During the term of the contract, if Party B violates any law or rules
and regulations of the MTR, Party B is responsible for all economic damages to
Party A, Party A can cancel the contract band keep the contract deposit.
Item 19 Party B has to pay Party A management fees on time. If Party B is late,
on top of the management fee, also required to pay a 0.05% daily late charge. If
late over 1 month, then Party B is in violation, Party A has the right to
terminate the contract and keep the contract deposit.
Item 20 During the term of the contract, in order to protect the spirit of the
contract, if either party needs to terminate the contract and it is not force
majeure, it has to give 30 days notice to the other party, otherwise the party
is in violation and is responsible to compensate the other party for its
economic loss.
Chapter 9 - Force Majeure
Item 21 Force Majeure refers to events or effects that cannot be reasonably
anticipated or controlled by either party, including: natural disaster, war,
disastrous incidents, governmental rulings and exceptional airport operational
or environmental requirements.
Item 22 If either side cannot carry out all or part of its responsibilities due
to force majeure, it has to notice the other side within 7 days, together with a
detail report and associated proof.
Item 23 If force majeure is declared, the parties should try to resolve the
situation and resume normal operations. If the force majeure causes either or
both sides to unable to carry out its responsibilities for over 60 days, then
either side can terminate this contract by notifying the other side in writing
and no damages have to be paid.
Item 24 At the termination of this contract, Party A will return the whole
contract deposit within 10 days to Party B without interest, if it is not
returned in time, then Party A has to pay a 0.5% daily interest to Party B.
Chapter 10 - Contract Cancellation, Termination and Early Termination
Item 25 Either side cannot terminate this contract unless it is force majeure.
If both sides decide to terminate this contract, there has to be a one month
notice to execute the termination.
Item 26 If both sides cannot come to agreement regarding termination, Item 28
will apply.
Item 27 With 30 days of the term of this contract, if both sides agree to extend
the contract, a new contract will be signed.
Chapter 11 - Dispute Resolution
Item 28 If disputes arise during the term of the contract, both sides should try
to resolve the dispute through friendly negotiations. If dispute persist, either
side can take the dispute to a court with jurisdiction.
Chapter 12 - Changes and Effective Date of the Contract
Item 29 This contract is effective upon signing by both parties, and will
continue regardless of change in personnel. All changes and alterations are
subject to negotiations by both parties, and signed and sealed by legal
representatives of both parties. Any changes and alternations will form
attachments to this contract and becomes an undetachable part of this contract.
Item 30 There are 8 copies of this contract, Party A holds six, Party B holds
two.
Party A: Guangzhou MTR Company
Legal Representative: Kang Ceng
Signed and Sealed
Date: September 16, 2004
Party B: Guangzhou Chuangrun Media Company Limited
Legal Representative: Cai Hanxiong
Signed and Sealed
Date: September 16, 2004