Exhibit 10.72
Operating Agreement
This Operating Agreement (the "Agreement") is entered into on the day of
October 1, 2004 among the following parties:
Party A: Hurray! Times Communications (Beijing) Ltd.
Registered Address: Room B 00-X, Xxxx Xxxx Xxxxx,
Xx. 0 Xxxxxxxx Xxxx, Xxxxxxx Xxxxxxxx, Xxxxxxx
Party B: Beijing Palmsky Technology Co., Ltd.
Registered Address: Xxxx 000, Xxxxxx Xxxxxxxx,
Xx. 000 Beisihuang Middle Road,
Haidian District, Beijing
Party C: Xxxx Xxxxxxx
Address:
Party D: Xxxx Xxxxx
Address: Xxxx 0-0, 00/xx/ Xxxxx, Xxxxx Xxxxxxxx,
Xxxxx Xxxx, North District, Tangshan City Road,
Hebei Province
WHEREAS:
1. Party A is a wholly foreign-owned enterprise registered in the People's
Republic of China (the "PRC");
2. Party B is a limited liability company registered in the PRC and is
approved by competent governmental authorities to carry on the business
of value-added telecommunications services;
3. Party A has established a business relationship with Party B by entering
into Exculsive Technical Consulting and Services Agreement;
4. Pursuant to Exclusive Technical Consulting and Services Agreement
between Party A and Party B, Party B shall pay a certain amount of money
to Party A. However, the relevant payables have not been paid yet and
the daily operation of Party B will have a material effect on its
capacity to pay the payables to Party A.
5. Party C is a shareholder of Party B who owns 50% equity in Party B.
6. Party D is a shareholder of Party B who owns 50% equity in Party B.
7. The Parties agree to further clarify matters relating to the operation
of Party B pursuant to provisions herein.
NOW THEREFORE, the Parties through mutual negotiations hereby agree as
follows:
1. In order to ensure Party B's normal operation, Party A agrees, subject
to Party B's satisfaction of the relevant provisions herein, to act as
the guarantor for Party B in the contracts, agreements or transactions
in association with Party B's operation between Party B and any other
third party and to provide full guarantee for Party B in performing such
contracts, agreements or transactions subject to applicable laws. Party
B agrees to mortgage the receivables of its operation and all of the
company's assets which have not been mortgaged to any third party as at
the execution date of this Agreement to Party A as a counter guarantee.
Pursuant to the above guarantee arrangement, Party A, as the guarantor
for Party B, shall enter into written guarantee contracts with Party B's
counter parties.
2. In consideration of the requirement of Article 1 herein and to ensure
the performance of the various operation agreements between Party A and
Party B and to ensure the payment of the various payables by Party B to
Party A, Party B together with its shareholders Party C and Party D
hereby jointly agree that Party B shall not conduct any transaction
which may materially affect its assets, obligations, rights or the
company's operation without obtaining a prior written consent form Party
A or Party A's Affliliates, including without limitations to the
following contents:
2.1 To borrow money from any third party of assume any debt;
2.2 To sell to any third party or acquire from any third party any
assets or rights, including without limitations to any
intellectual property rights;
2.3 To provide real guarantee for any third party with its assets or
intellectual property rights; and
2.4 To assign to any third party its right and obligations under
this Agreements.
3. In order to ensure the performance of the various agreements between
Party A and Party B and to ensure the payment of the various payables by
Party B to Party A, Party B together with its shareholders Party C and
Party D hereby jointly agree to accept the provision of the corporate
policies and guidance by Party A at any time in respects of appointment
and dismissal of the company's employees, the company's daily operation
administration and the company's financial administrative system.
4. Party B together with its shareholders Party C and Party D hereby
jointly agree that Party B, Party C and Party D shall appoint the
personnel recommended by Party A as the directors of Party B, and Party
B shall engage Party A's high ranking officers recommended by Party A as
Party B's General Manager, Chief
2
Financial Officer, and other high ranking officers. If any of the above
directors or officers leaves or is fired by Party A, he or she will lose
the qualification to undertake any positions in Party B and Party B,
Party C and Party D shall appoint other high officers of Party A
recommended by Party A to undertake such position.
To ensure the performance of such arrangement, Party A and Party B agree
to cause such directors or high ranking officers to enter into director or high
ranking officer engagement agreements with Party B in compliance with the above
arrangement.
Party C and Party D hereby agree to sign an authorization agreement upon
execution of this Agreement, by which Party C and Party D will authorize the
individual employed by Party A to exercise all of their respective voting rights
as a shareholder at Party B's shareholder meetings according to laws and
articles of association of the company.
5. Party B together with its shareholders Party C and Party D hereby
jointly agree and confirm that except the stipulation set forth in
Article 1 herein , Party B shall seek a guarantee from Party A first if
Party B needs any guarantee for its performance of any contract or loan
of working capital in the course of operation. In this case, Party A
shall have the right but not the obligation to provide appropriate
guarantee to Party B on its own discretion. If Party A decides not to
provide such guarantee Party A shall issue a written notice to Party B
immediately and Party B shall seek a guarantee from other third party.
6. In the event that any of the agreements between Party A and Party B
terminates or expires, Party A shall have the right but not the
obligation to terminate all agreements between Party A and Party B
including without limitation to Exclusive Technical Consulting and
Services Agreement.
7. Any amendment and supplement of this Agreement shall be in a written
form. The amendment and supplement after being duly executed by each
Party shall be part of this Agreement and shall have the same legal
effect as this Agreement.
8. This Agreement shall be governed by and construed in accordance with the
PRC law.
9. The parties shall strive to settle any dispute arising from the
interpretation or performance 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 in
accordance with the current rules of CIETAC. The arbitration proceedings
shall take place in Beijing and shall be conducted in Chinese. The
arbitration award shall be final and binding upon the parties.
10. Notice. Any notice which is given by the parties hereto for the purpose
of performing the rights, duties and obligations hereunder shall be in
writing. Where such notice is
3
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 from time to time. The written form includes facsimile and
telex.
11. This Agreement shall be executed by a duly authorized representative of
each party as of the date first written above and become effective
simultaneously. The term of this agreement is ten years unless early
termination occurs in accordance with the relevant provisions herein.
This Agreement may be renewed only upon Party A's written confirmation
prior to the term of this Agreement expires. The renewed term shall be
determined pursuant to Party A's written confirmation.
12. This Agreement shall be terminated on the expiring date unless it is
renewed in accordance with the relevant provision herein. During the
valid term of this Agreement, Party B, Party C and Party D shall not
terminate this Agreement. Notwithstanding the above stipulation, Party A
shall have the right to terminate this Agreement at any time by issuing
a thirty days prior written notice to Party B, Party C, Party D and
Party E.
13. This Agreement is executed in five copies in Chinese.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
duly executed on their behalf by a duly authorized representative as of the date
first written above.
4
Operating Agreement
(No text on this page)
By: /s/ Signed
------------------------------------------------
Party A: Hurray! Times Communications (Beijing) Ltd.
Authorized Representative
Name:
Position:
Date:
By: /s/ Signed
------------------------------------------------
Party B: Beijing Palmsky Technology Co., Ltd.
Authorized Representative:
Name:
Position:
Date:
By: /s/ Xxxx Xxxxxxx
------------------------------------------------
Party C: Xxxx Xxxxxxx
Date:
By: /s/ Xxxx Xxxxx
------------------------------------------------
Party D: Xxxx Xxxxx
Date:
5
