Document:

exv10w37

 

Exhibit 10.37

Agreement on Short Message Service Cooperation

Party A: Guangdong Mobile Communications Corporation

Party B: Guangzhou Media Message Technologies, Inc.

Guandong Mobile Communications Corporation (hereinafter referred to as “Party
A”) is a network operator approved by the competent authority in charge of
information industry under the State Council, mainly engaged in providing
mobile network telephone service (including voice message, data and multimedia)
to the general public within Guangdong Province.

Guangzhou Media Message Technologies, Inc. (hereinafter referred to as
“Party B”) uses wireless interconnections as its major platform to provide a
range of mobile message services to customers who can access the Internet via
mobile terminal or PCs.

To fully bring into play each party’s advantage in its respective service area
and to provide Monternet short-message service to “GoTone” and “M-Zone”
subscribers in Guangdong and other subscribers permitted by Party A, the
parties hereby conclude the following agreement with respect to short-message
service cooperation based on the principles of equal benefit, advantage sharing
and mutual development.

Article 1 Contents of Cooperation Project

	1)	 	As a provider of the short-messaging platform, Party A shall provide
networking channels to Party B with compensation.
	2)	 	Party B shall use Party A’s short-messaging system to provide the
following information and application services to Party A’s “GoTone” and
“M-Zone” subscribers and other subscribers permitted by Party A. Party B
shall, according to subscribers’ customization requirements, provide
timely information services with sound quality and quantity to
subscribers.
	3)	 	Party A shall use its billing and business supporting system to provide
Party B with paid business billing and fee collection service.

Article 2 Party A’s Rights and Obligations

	1)	 	Party A shall have the right to verify operation license for internet
information services or operation license for telecom value-added
services, credit certificate, business license, source of information,
bank account and other materials relating to the normal operation of
business provided by Party B.
	2)	 	Party A shall provide short-message service to the short-message gateway
provided by Party B, and shall be responsible for providing Party B with
short-message gateway and short-message traffic volume control. Party A
shall have the right to timely adjust short-message traffic volume
according to its short-message center’s capacity.
	3)	 	Any expansion of Party B’s business or its application to alter its
business must be subject to Party A’s review within 10 days upon
submission of related materials by Party B.
	4)	 	Party A shall have the ownership of its subscribers and the right to
learn the truth about Party B’s business and have the right to request
Party B to provide Party A with customer information, business profile,
log and statistics relating to Party B’s Monternet services.

 

 

	5)	 	Party A shall have the right to stipulate management regulations of the
Monternet services, performance examining items, and standards and
documentation of customer services that Party B shall comply with and
implement according to Party A’s requests. Party A shall carry out 1-2
examines on Party B’s performance every year according to the
above-mentioned management regulations.
	6)	 	Party A shall provide Party B with a system to identify and verify user
registration and log-on information, which system shall be connected with
Party B’s content service system, and the subscriber data recorded by such
system shall be the controlling information on the subscribers’ using of
Party B’s services.
	7)	 	Party A shall provide Party B with a customer service number for the
customer to make complaint and enquire calls. And Party A’s customer
service center shall be the party to make final confirmation and
distribution of Monternet customer service problems, Party B’s customer
service personnel or customer service system shall assist Party A to
analyze and deal with customers’ business-related complaints and
enquiries. Party A shall have the right to forward to Party B customer
enquiries and complaints caused by non-network communication problems
arising from such business. Party A shall be liable for such customer
enquires and complaints caused by network communication problems.
	8)	 	Party A shall collect the service fee from subscribers for Party B based
on Party A’s billing information.
	9)	 	Party A shall provide Party B with the traffic volume information of the
short-messages sent via the short-message gateway used by Party B. Such
traffic volume information shall be the basis for the settlement of
short-message communication fee.
	10)	 	Party A shall have the right to verify the profit forecast of the parties
provided by Party B to Party A prior to the commence of the service.
	11)	 	Party A and Party B may jointly engage in marketing and customer
advertisement. Party A shall have the right to request Party B to identify
the brand of “MONTERNET” upon Party A’s examination and approval. In the
event that Party B’s promotion and advertisement involves Party A’s
corporate name and other brand specifications, it shall be subject to
Party A’s prior examination and approval.

Article 3 Party B’s Rights and Obligations

	1)	 	Party B shall provide Party A with true and reliable operation license
for internet information services or operation license for telecom
value-added services, credit certificate, business license, source of
information and bank account and other materials relating to the normal
operation of business, and guarantee that the billing for such information
services complies with relevant regulations of the state pricing
authority.
	2)	 	Party B shall comply with relevant state policies, laws, decrees in
regard to telecommunication and internet information. Party B shall ensure
the information content provided by it not to violate relevant state laws,
regulations and policies, and ensure not to use Party A’s system deliver
nine categories of illegal information listed in Information Source
Networking Information Safety and Security Liability Statement (Appendix
4). Party B shall be responsible for filtering the information content
provided to subscribers (including the information content edited by
subscribers via Party B’s websites), and eliminating each sort of
unhealthy or illegal information.

 

 

	3)	 	In the event that Party A receives customers complaints with respect to
transmitting illegal information, Party B shall furnish Party A’s customer
service department its preliminary response within 2 hours and find out
the reasons within one working day, and Party B shall be responsible for
immediately ceasing transmitting illegal information.
	4)	 	Party B shall verify subscribers’ true identity and display calling
number along with the short-message, and no anonymous short-message or
short-message with only nick name displayed shall be delivered to other
subscribers’ mobile telephone (except chatting business of virtual
community).
	5)	 	Party B shall strictly control any function of group short-message
service provided by it and ensure a piece of short-message can be
delivered to at most 1-2 calling numbers.
	6)	 	During the term of this Agreement, Party B shall not, through either
channel and on either level of business, connect Party A’s mobile data
application business and the third party with each other. Party B shall
establish a separate database for Party A’s Mobile subscribers (135-139),
which is separated from that for the subscribers of the third parties.
Party B shall not, by means of any sort of business (including
short-message chatting, edited short-message and delivering short-message
via internet, etc.) and at its own discretion, realize disguised
connection between Monternet business and the third party.
	7)	 	Within the term of this Agreement, Party B shall not deliver
advertisement or other irrelevant information to subscribers. Any
expansion or alternation of Party B’s business shall be subject to Party
A’s review and approval, and be verified by Party A’s billing examination.
Party B shall duly furnish Party A the business materials that need to be
accepted by Party B (as of the date of this Agreement, the services
provided by Party B are listed as Appendix 3 hereto.)
	8)	 	Within the term of this Agreement, Party B shall furnish Party A,
according to Party A’s requirement, a report with the data including
situation of subscriber development, subscriber classification, subscriber
using customs, and business forecast, etc., and duly transfer Party A the
subscribers materials necessary for managing such business, and ensure
that Party A’s subscriber database is upgraded. Party A shall keep such
information confidential in according with Article 6 “Confidential
Clause”. Party B shall be responsible for providing system to keep a log
and shall keep historical records for at least one month.
	9)	 	Party B shall ensure that subscribers are well aware of the price,
content and the means by which such services are provided prior to the
subscribers accept each service provided.
	10)	 	On the basis of the principle of voluntaries, Party B shall obtain
subscriber’s consent prior to Party B providing its services, and shall,
according to subscribers’ customization requirements, provide subscribers
with duly information service with correct quality and quantity.
	11)	 	Party B shall comply with and implement Party A’s management regulations,
standards and documentation of customer service with respect to Monternet
business, and accept Party A’s inspection and supervision. If Party B
withdraws from providing Monternet service for whatever reason (including
compulsory withdraws in Party A’s examination), Party B shall be
responsible for providing a one-month grace period, within which Party B
shall continue providing its service and make an announcement of ceasing
service on its website (WWW/WAP) or through other channels.
	12)	 	Party B shall be responsible for handling customer enquiries and
complaints caused by each non-internet communication problem in such
business, and establish effective channels for complaints that shall be
directed to Party A’s customer service center. Party B shall assume the

 

 

	 	 	ultimate liability to customer for those customer complaints for which
neither Party A nor Party B can reasonably explain.
	13)	 	Party B shall be responsible for furnishing Party A the bill of
information fee collected for short-message information service. The
format of such list must be compliance with the data format provided by
Party A.
	14)	 	Party B shall be solely liable for tax payment on its profit.
	15)	 	Party A shall issue a formal invoice to Party A for such information
service fee collected from Party A.
	16)	 	Party B shall actively engage itself in marketing and customer promotion.
The content of Party B’s promotion and advertisement shall include the
“MONTERNET” brand as required by Party A.
	17)	 	Within 6 months after the entry into force of this Agreement, Party B
shall not, in Guangdong Province, conduct the same or similar
short-message business listed in the Appendix of this Agreement with the
third party.

Article 4 Maintenance Responsibilities

	1)	 	Responsibilities for maintenance of the parties shall be divided at the
point where the parties’ equipments connect; each Party shall perform its
respective obligations to ensure the normal operation of its business.
	2)	 	Detailed responsibilities of the parties are listed in Appendix 1 hereto.

Article 5 Billing and Settlement

	1)	 	Party A shall be entitled to the short-message communication fee arising
from subscribers’ or Party B’s using of short-message function. Party B
shall be entitled to the information service fees paid by subscribers.
Party A shall provide Party B with the service of collecting information
fees and charge certain collecting service fee.
	2)	 	If subscribers refuse to pay the information fees due to the quality of
Party B’s service, such unpaid sum shall be deducted from Party B’s
information fees.
	3)	 	If Party B fails to furnish the bill of information fees collected
according to time and format required, Party A shall not include such sum
in the information fees collected for Party B and Party B shall be solely
liable for any consequence arising therefrom.
	4)	 	Detailed method for billing and settlement is set forth in Appendix 2
hereto.

Article 6 Reward and Punishment Provision

	1)	 	If any of the following occurs, Party A shall have the right to request
Party B to immediately rectify, and according to the real situation deduct
the information fees collected by Party A. Party A shall have the right to
immediately terminate the Parties’ cooperation when the circumstances are
particularly serious.

	i)	 	Party B violates relevant state policies, laws and decrees with respect
to telecommunication and internet information.
	ii)	 	The contents of information provided by Party B constitute violation
of relevant state laws, regulations and policies, or Party B uses
Party A’s system to deliver nine categories of illegal information
listed in Information Source Networking Information Safety and
Security Liability Statement (Appendix 4).

 

 

	iii)	 	Party B mischarge or arbitrarily charge fees from subscribers and the
circumstances are serious.
	iv)	 	Subscribers strongly complain the quality of Party B’s service.
	v)	 	Party B fails to use Party A’s company name and other brand standards in
Party B’s promotion and advertisement as required, and results in negative
social impact.
	vi)	 	Party B uses Party A’s mobile data application business to connect
with the third party, or, by means of any sort of business
(including short-message chatting, edited short-message and
delivering short-message via internet, etc.) and at its own
discretion, realize disguised connection between Monternet business
and the third party.
	vii)	 	The subscribers are seriously affected by Party B’s system testing,
activation modification, which results in strong complaints from
subscribers.
	viii)	 	Party A’s network system is damaged due to Party B’s system testing,
activation and modification.
	ix)	 	Other conducts of Party B constitute violation of this Agreement.

	2)	 	If any of the following occurs, Party A shall have the right to terminate
the Parties’ cooperation or not to renew this Agreement.

	i)	 	Party B provides Party A with false operation license for internet
information services or operation license for telecom value-added
services, credit certificate, business license, source of information and
bank account and other materials relating to the normal operation of
business, or the fees of information services provided by Party B is not
in compliance with relevant regulations of the state pricing authority.
	ii)	 	Party B’s examining performance ranks twice consecutively among
bottom 5, and no effect arises from rectification.
	iii)	 	In the term of this Agreement, Party B fails to achieve the Parties’
profit forecast data furnished to Party A prior to the activation of
service.
	iv)	 	In the term of this Agreement, Party B conducts other fraudulent acts
and the circumstances are serious.

	3)	 	If Party B’s examining performance ranks among top 10, Party A will
provide preferential promotion support, and give preferential
consideration to Party B’s other requests.
	4)	 	If Party B effectively implement relevant provisions in this Agreement,
and the average annual rate of subscriber complaints on Party B’s
short-message service is low, Party A shall give preferential
consideration to extend this Agreement with Party B.

Article 7 Confidentiality

	1)	 	Both parties shall be responsible to keep confidential all the customer
materials obtained from such services.
	2)	 	Proprietary information received by one Party from the other Party (the
“Disclosing Party”) that is developed, created, discovered or learned by
the Disclosing Party, or transferred to the Disclosing Party, and is of
commercial value to the business of the Disclosing Party, including but
not limited to relevant commercial secret, computer program, design
techniques, idea, know-how, process, data, business and product
development plan, customer information relating to the business of the
Disclosing Party and other information, or confidential information that
the Disclosing Party receives from another party, shall remain the
property of the Disclosing Party, the other Party shall keep confidential
any and all proprietary

 

 

	 	 	information, and without prior written consent of the Disclosing Party,
shall not use or disclose such proprietary information to any individual or
entity, except for the purpose of normal performance of the obligations
hereunder.
	3)	 	Both parties shall be responsible to keep confidential this cooperation
and the terms and conditions of this Agreement. Without prior written
consent of the other Party, neither Party shall disclose to any third
party details of the cooperation between the parties and the terms and
conditions of this Agreement.

Article 8 Breach of Agreement

	1)	 	If this Agreement cannot be performed due to any Party’s violation of
this Agreement, the other Party shall have the right to terminate this
Agreement.
	2)	 	If any party breaches any obligations under this Agreement and incurs bad
social impact or economic losses to the other party, the other party shall
have the right to hold the party in breach responsible for such breach,
requires the party in breach to reverse such impact and make corresponding
compensations, and to terminate this Agreement.

Article 9 Force Majeure

Any party hereto shall not be held responsible for the other party’s economic
losses or the failure or delay to perform all or any part of this Agreement due
to force majeure events that could not be predicted and the result of which
cannot be controlled or prevented. However, the party affected by such force
majeure events shall promptly provide the other party with written notice of
such occurrence and, within 15 days thereafter, send a valid certificate issued
by the relevant authority explaining the details of such events and the reason
for its failure or delay to perform all or any part of this Agreement. Both
parties shall negotiate the performance or termination of this Agreement
according to the degree of impact on the performance hereof caused by such
events.

Article 10 Amendment or Modification

	 	1)	 	During the cooperation between the Parties, relevant business
management requirements and relevant customer management requirements
stipulated by Party A for the Monternet shall be incorporated as a
supplement hereto. If there is any conflict between the provisions of
this Agreement and the management requirements, the management
requirements shall prevail. Both parties agree to negotiate on the
conflicting provisions, and execute a supplemental agreement.
	 	2)	 	If any party hereof intends to modify or terminate this
Agreement, it shall provide written notice to the other party at least
15 days prior thereto. Notice in oral form shall be invalid. Any
dispute arising from the termination of this Agreement shall be
negotiated in order to reach a resolution between the parties.
	 	3)	 	Any issues not included in this Agreement shall, upon agreement
through amicable negotiations between the parties, be included as a
written supplement hereto.
	 	4)	 	This Agreement shall be governed by the laws of the People’s
Republic of China. If the Parties hereto fail to resolve dispute by
negotiation, either Party may file an action in front of the court of
the place where Party A is located.
	 	5)	 	This Agreement shall enter into force after being signed by the
representatives of the Parties and affixed with the official seal of
the Parties; the term hereof shall be two years,

 

 

	 	 	 	which is renewable upon agreement by both Party A and Party B through
consultation.
	 	6)	 	This Agreement and its Appendixes are made into four
counterparts, every two for each party, all with equal legal effect.

Appendix 1: Maintenance Responsibilities

Appendix 2: Billing and Settlement

Appendix 3: Business and Price of Party B

Appendix 4: Information Source Networking Information Safety and Security Liability Statement

Party A: Guangdong Mobile Communications Corporation

Authorized Representative:

Date: October 10, 2002

Party B: Guangzhou Media Message Technologies, Inc.

Authorized Representative:

Date: November 12, 2002

 

Appendix 1: Maintenance Responsibilities

A. Diagram of the Maintenance Sections:

B. Party A’s Rights and Obligations

	1)	 	Party A shall contribute necessary software and hardware required by its
short-message system.
	2)	 	Party A shall assist Party B to connect Party B’s server to its
short-message gateway.
	3)	 	Party A shall be responsible for providing Party B with the relevant
technical agreement specifications and interface technical specifications.

 

	4)	 	Party A shall be responsible for maintaining the normal operation of the
network telecommunications, and assume responsibility for network problems
not caused by Party B. Party A shall reserve his right to restrict
delivery of any mass of short-messages abnormal and overloaded, which may
impact upon the operation safety and security of Party A’s network.
	5)	 	Party A shall provide Party B with the statistics for the information
traffic volume through the telecommunications channel used by Party B, and
ensure the reliability and timeliness of such statistics data, and assume
responsibilities for any damages caused thereby.
	6)	 	Party A shall notify Party B in advance for any transmission interruption
caused by testing, maintenance or other foreseeable reasons, including the
reason, time and period of such transmission interruption.
	7)	 	Party A shall ensure to immediately notify Party B for any transmission
interruption caused by unforeseeable reasons such as gateway problem or
other problems.

C. Party B’s Rights and Obligations

	1)	 	Party B shall be responsible for construction and maintenance of its own
“information service” system, including all hardware equipment, system
testing, activation, system maintenance, daily service management,
marketing promotion and expenses that relate to such business.
	2)	 	Party B shall be responsible for the connection Party B’s system and
Party A’s shore-message gateway, and expenses for the application, lease
and maintenance of relevant telecommunication lines.
	3)	 	Party B shall be responsible for editing, review and composition of the
information it provides, and ensure that the information is timely, exact,
true, reliable and legal, and assume corresponding liabilities thereto.
	4)	 	Party B shall be responsible for establishing the website column
“Monternet — My Service”. After the customers log in such website, the
“Monternet — My Service” column shall be displayed at remarkable place of
the webpage. The items of the column shall include the list of all
services customized for such subscriber at such website, and following
each specific service list provide the function of enquiry and withdraw of
such service. The set-up of the customization interface during customizing
short-message shall make convenient for customers to know the items and
services provided by SP, and the clear and specific billing standards
shall be stipulated and include at least verifying, adding, deleting,
modifying, checking out and other basic service functions; following the
success of subscribers’ customizing service, the system shall prompt the
subscriber that “this service has been added to ‘Monternet-My Service’
column, if you want to enquiry or withdraw this service, please click
‘Monternet-My Service’”.
	5)	 	Party B shall ensure that the testing, activation and modification of its
system would not be carried out at busy hours of Party A’s business. The
works that may seriously impact subscribers shall be conducted at late
night. Party B shall ensure the above mentioned works would not affect
the normal operation of Party A’s network and assume corresponding
liabilities for any damages caused thereby to Party A’s network system.
	6)	 	Party B shall make prior notice to Party A in writing for the testing,
activation and modification of its system, and notify subscribers of the
same through effective means such as email, advertisement or short message
upon Party A’s confirmation thereof, and shall reduce

 

 

	 	 	the impact on subscribers to the minimum degree.
	7)	 	During the cooperation, Party A shall observe Party A’s emergency
adjustment to the volume of shore-message for the purpose to ensure the
normal and stable operation of short-message services.
	8)	 	Party B undertakes not to create any overload traffic volume that may
harm to safety and security of the network when transmitting
short-messages to Party A’s communication platform.
	9)	 	Party B shall provide 7-days-a-week and 24-hours-a-day system
maintenance.

 

 

Appendix 2: Billing and Settlement

	1)	 	With respect to the local service, Party B shall file the characters of
collecting information fee into each message submitted according to Party
A’s unified format requirements.
	2)	 	The means of payment of information fee is: Party A shall charge the
subscribers communication fee RMB 0.10 Yuan/message for uplink messages,
and charge Party B communication fee RMB 0.05-0.08 Yuan/message for
ill-balance downlink messages as follows:

	 	 	 	 	 
	Ill-balance downlink SM traffic (messages/month)

	 	Fee standard (RMB Yuan/message)

	Below 5,000,000

	 	0.08	 
	5,000,000-10,000,000

	 	0.07	 
	10,000,000-20,000,000

	 	0.06	 
	Over 20,000,000

	 	0.05	 

	3)	 	Party B shall be entitled to the subscribers information service fee of
the short-message information service provided by Party B, and such fee
shall be collected by Party A from the GoTone subscribers on behalf of
Party B. Party B shall pay Party A at 15% of receivable information
service fee, and reserve the remaining 85% of receivable information
service fee. The settlement month shall be one month relatively behind the
exact occurrence of credit and debt.
	4)	 	The communication fee paid by Party B to Party A and the billing list of
information fee collected by Party A on behalf of Party B shall be based
on the daily communication records of successful delivery furnished by
Party A to Party B.
	5)	 	The Parties shall, on the 10th of each month (settlement month), verify
the data of receivable and actually paid information service fees in
pervious month, and, upon verification, settle the account no later than
the 25th of each month (settle month).
	6)	 	If any conflict with respect to the statistics data of information
service fees arising between Party A and Party B, Party A’s data shall
prevail under the condition that the difference between the Parties’
statistics data is not over 6%. In the event that such difference is over
6%, the Parties shall rectify and figure out the reason, and reasonably
resolve according to the actual situation.

 

 

Appendix 3: Business and Price of Party B

1. Company’s Name in Full: Guangzhou Message Technologies, Inc.

     Address: Room 1108#1109, Tianhe Commercial Building, No 8, Zhongshandadao West,

Guangzhou City

     Opening
Bank: Yangcheng Sub-branch, Guangzhou Branch, Shenzhen Development Bank

   Bank Account: 9250719070992

2. Network Connection Mode: SMS    WAP GPRS

     Connection Location: Guangzhou

3. Customer Service superintendent (2 persons)

     1) Name: Liu Dan    Tel: 13678906670

             E-mail Add: linda.liu@Memestar.com

     2) Name: Chen Jianfang    Tel: 13825022207

             E-mail: jerry.chen@Memestar.com

4. Customer Service Tel: 020-87577706, 87577719

5. Service Website:  WWW.meme.com.cn

6. Business Content Description and Price

	 	 	 	 	 	 	 	 	 
	Business Code	 	Name of Business	 	Specification	 	Fee Standard	 	Sending Frequency
	FCNV

	 	Mobile men and women
	 	Net friend chat

game via SMS
	 	$5yuan/month
	 	
	YDDFW

	 	Mobile rich
	 	Quiz game with

award via SMS
	 	0.1yuan/piece	 	 
	QZW

	 	Mobile job

searching website
	 	Net job searching
	 	0.3yuan/piece	 	 
	LTS

	 	Mobile chat room
	 	Net chat game on

subject
	 	0.1yuan	 	 
	FCDG

	 	Feichangdiange
	 	Net song choosing

game
	 	4yuan/song	 	 
	PTLS

	 	Common ring
	 	Ring download via

SMS
	 	1yuan/ring	 	 
	GBZLS

	 	Hi-fi ring
	 	Ring download via

SMS
	 	2yuan/ring	 	 
	BZT

	 	Standard picture
	 	picture(LOGO)

download via SMS
	 	0.5yuan/piece	 	 
	DT

	 	Big picture
	 	picture download

via SMS
	 	2yuan/ piece	 	 
	YAHOO

	 	Yahoo Personal
	 	Chat with users of
Hongkong Yahoo
	 	5yuan/ month	 	 
	ZQCCC

	 	football guess via

Mobile
	 	ball guess game
	 	0.2 Yuan/ piece	 	 

 

 

Appendix 4: Information Source Networking Information Safety and Security Liability Statement

     Information source Accountability Company accesses into China Mobile
Internet (CMNET) or short-message gateway (including short-message information
platform IOD, short-message center) of Guangdong Mobile Communications
Corporation, and guarantees to abide by the following regulations:

	1)	 	Observe relevant law, administrative regulations and management
regulations of the country; strictly implement information safety and
security management stipulations.
	2)	 	Shall not use China Mobile Internet (CMNET) or short-message gateway
(including short-message information platform IOD, short-message center)
for any illegal or criminal activities that may harm to national security,
or disclose national secretes; shall not use China Mobile Internet (CMNET)
or short-message gateway (including short-message information platform
IOD, short-message center) to compose, refer, copy and transmit any
information that may violate constitution and law, hamper public security,
disrupt national unification, disrupt solidarity of the nationalities,
or any pornographic or violent information; shall not use China Mobile
Internet (CMNET) or short-message gateway (including short-message
information platform IOD, short-message center) to transmit any
information that may contain any of the following:

	i)	 	be against the basic principles established by the constitutional law;
	ii)	 	jeopardize state security, betray national secretes, subvert national political power, disrupt national unification;
	iii)	 	harm to national glory and benefit;
	iv)	 	incite hatred or discrimination of nationalities, disrupt solidarity of the nationalities;
	v)	 	disrupt national religious policies, advocate heresy and superstition;
	vi)	 	spread rumors, disturb social order, disrupt social stability;
	vii)	 	spread obscenity, pornography, gamble violence, homicide, terrorism, or solicit a crime;
	viii)	 	insult and slander others, infringe other’s legal rights and benefits;
	ix)	 	contain other items that are prohibited by laws and administration regulations.

If any above mentioned illegal or criminal activities and harmful information
is found, measures must be immediately taken to suppress, and report to
relevant competent authorities in time.

	3)	 	The information provided by information source Accountability Company
must be compliance with relevant state intellectual property regulations.
	4)	 	The information source accountability company shall establish effective
information security and confidentiality management system and technical
safeguard measures, and accept the management, supervision and inspection
of relevant competent authorities.
	5)	 	If any violation on above provisions, Guangdong Mobile Communications
Corporation shall have the right to take measure shut access channel of
relevant information source; meanwhile, hold the accountability company
for such violation, and terminate the cooperation with such accountability
company. Guangdong Mobile Communications Corporation shall keep this
Liability Statement.

Accountability Company: Guangzhou Media Message Technologies, Inc.

 

 

Person In Charge: (signature & seal)

Date: November 12, 2002exv10w38

 

Exhibit 10.38

Monternet Short-messaging Service Cooperation

Agreement

Agreement code:
Execution
date: April 28, 2003

Party
A:                                                                          
      Beijing Mobile Communications Corporation

Legal representative: Sha Yuejia

Mail address: No. 58, Dong Zhong Street, Dongcheng District, Beijing, 100027,
China

Tel: 65546699

Fax: 65541330

Opening bank:

Bank account:

Party B: Beijing SINA Internet Information Service Co., Ltd.

Legal representative: Mao Dao Lin

Mail address: 15/F      ,#A1, Wanquanzhuang, Haidian District, Beijing

Tel: 010-82628888

Fax: 010-85803327

Opening bank:

Bank account:

Beijing Mobile Communications Corporation (hereinafter referred to as “Party A”), as the
mobile communication operator and mobile data service operator, provides open
and fee-based communication channels for the application providers. Beijing
SINA Internet Information Service Co., Ltd. (hereinafter referred to as “Party
B”), as a company engaged in the value-added communication services approved by
the competent telecom authorities, provides value-added short-message services
to mobile phone users of China Mobile. To provide better application services
to users, the parties agree as follows as to the joint development of Monternet
short-message services upon adequate consultation in the principle of equality,
mutual benefit and concerted growth.

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I. Basic Description of Cooperation

1. Fundamental conditions

	1)	 	Party B shall be fully compliant with the requirement of Internet Content/Application Service
Management Methods of the State Council Order (No 292), be authorized for the qualification of
the Internet information service business, be able to provide comprehensive after service
system, and have legal and reliable information/message sources and other legal business
operation conditions.
	 
	2)	 	In case Party B is the local partner of Party A, Party B shall provide Monternet short-message
services only to China Mobile mobile phone users in Beijing region via the short-message
channels of Party A.
	 
	3)	 	Party B shall promptly provide detailed business plans and marketing plans in writing to Party A.
	 
	4)	 	Party A shall make regular examination and management to Party B
according to the business regulations of Monternet, and terminate the
cooperation with Party B upon failure of Party B to pass such
examination.

II. Rights and Obligations

1. Party A’s rights and obligations

	1)	 	Party A allows Party B to provide short-message value-added services
to users via the short-message gateway of Party A. Party A is entitled
to adjust the short-message traffic volume according to the capacity
of the short-message center. If such adjustment shall impact on the
business of Party B, Party A shall promptly notify Party B thereof.
	 
	2)	 	Party A shall provide comprehensive GSM mobile communication system,
and ensure smooth and stable information transmission. Upon the
notification of Party B of any communication failure, Party A shall
promptly settle the failure to avoid impairment of Party B’s business.
	 
	3)	 	Party A shall open the technical protocol, standard and interface
standard relevant to the short-message gateway platform to Party B.
Party A shall provide the technical documentation for mutual
communication, and promptly address communication problems of Party B.
	 
	4)	 	Party A shall supply the hardware/software system for the
short-message platform, and bear the relevant operation cost.
	 
	5)	 	Party A shall renovate its own billing system, including the
commission-based collection system of the banks, and bear the cost of
necessary hardware and software.

2

 

	6)	 	Party A shall undertake the billing and payment collection on behalf
of Party B. Party A is entitled to check the business of Party B to
ensure the accurate billing data. Party A shall issue explicit
information service fee invoice to users and the information service
fee bill at the request of the user.
	 
	7)	 	When applicable, Party A shall provide the relevant data of Monternet
invalid users (number canceling, service discontinuance and overdue
information service fee) to Party B to facilitate Party B to dispose
of such invalid Monternet users promptly.
	 
	8)	 	The parties shall make joint marketing and promotion.

2. Party B’s rights and obligations

	1)	 	Party B shall undertake the building and maintenance of its own
software and hardware, including but not limited to all hardware,
system commissioning, cutover, system maintenance, routine business
management and marketing efforts/cost of the subject project.
	 
	2)	 	Party B shall provide the agreed contents and application services to
China Mobile users. Party B shall ensure the legal, prompt and
reliable information sources. Party B shall guarantee that its
information and content are compliant with applicable policies, laws
and regulations, and be liable for any consequence arising out of
illegal contents.
	 
	3)	 	Party B’s Website with customization interface for users is
sms.sina.com.cn to inform users of the contents and service provided
by Party B. The customization interface of Party B shall provide basic
service functions like authentication, adding, deleting, modifying and
searching, and allow users to inquire about the information service
fee list. Party B shall provide explicit fee standards to users
with the service fee standard changing frequency not less than 6
months. That is to say, the service fee standard of a service (new
service or changed service) shall not be changed within the first 6
months. Party B shall keep complete use records of all users of at
least 3 months, keep the user ordering data permanently, and provide
the interface to Party A to inquire about the service records.
	 
	4)	 	Party B shall take necessary measures to effectively control invalid
Monternet users. To ensure normal operation of Monternet business,
Party B shall not send any information to invalid Monternet users it
get to know.
	 
	5)	 	In case the system failure of Party B impairs the communication system
of Party A, Party B shall follow the adjustment measure arranged by
Party A to Party B’s short-message traffic volume to ensure normal and
stable short-message service of Party B, and settle any user complaint
thus incurred at its own cost.
	 
	6)	 	Party B shall not send advertisements and other irrelevant information
to users via the communication channels of Party A during the term of
this agreement. Party B shall strengthen the check of the
short-message contents, restrict the group SMS numbers (at most 2 each
time) and

3

 

	 	 	sending times in each time unit (not over 100 each hour).
Party B shall take technical measures against illegal attack,
unauthorized use of passwords, unauthorized convoking of web pages and
other illegal acts impairing Monternet business information security.
	 
	7)	 	During the term of this Agreement, Party B is obligated to furnish the
monthly report within the first 5 days each month as requested by
Party A to Party A, stating the user development, user categories,
user habits, business forecast and others, the monthly report format
as set out in Exhibit 1 hereto. Party A shall keep the confidentiality
of such data according to Article 8 hereto.
	 
	8)	 	The parties shall undertake joint marketing and promotion.

III. Distribution of Rights and Obligations

	1.	 	Party B shall address the user disputes arising out of contents,
services or transmission failure between the parties. Party A shall
responsible for the user disputes arising out of the short-message
gateway and center. The maintenance labor-division is as follows:

4

 

	2.	 	The contents or applications provided by Party B shall be within the
business scope mutually agreed, otherwise Party A is entitled to
terminate this Agreement with Party B liable to the default penalty.
Party A is entitled to supervise the business development of Party B,
Party B shall assist the efforts of Party A in this regard in an
effort to avoid negative impact on normal business of Party A by the
business of Party B. In case the business development of Party B
negatively impairs the normal business of Party A due to the violation
against this Agreement, Party A is entitled to terminate this
Agreement with Party B liable for the default liability.
	 
	3.	 	Party B shall notify Party A in writing prior to adding or withdrawing
any services hereunder or changing the price of some services. In case
of agreeing with the change of certain service prices, Party A shall
notify Party B in writing. In case of Party A’s written consent of
adding certain services by Party B, Party B shall test the added
services with regular test reports submitted to Party A, and shall not
provide such new services to users without the acceptance of the
sophistication of such services by Party A, details refer to Exhibit 2
hereto.

IV Revenues of the Parties

	1.	 	Party A shall charge the mobile phone user the communication service
fee at RMB 0.10 yuan/message for the short-message services hereunder.
In principle, Party B shall determine the information service fee for
the services hereunder used by the mobile phone users subject to the
approval of China Mobile Corporation. Party A suggests the upper
threshold of the information service fee (maximum RMB 2 yuan/message,
RMB 30 yuan/month for monthly services). Party B shall submit the fee
standards to the price administration authorities, and promptly notify
Party A accordingly.
	 
	2.	 	Party A shall provide the billing service and fee collection service
to Party B. All information

5

 

	 	 	service fee of Beijing region users of
each billing month shall be the due information service fee in
Beijing. Party A shall pay 85% of the due information service fee of
Beijing to Party B, and be liable to the risk of overdue payment of
local users. In case Party B is the full-network partner of Party A,
i.e. Party B provide Monternet short-message value-added services to
nationwide China Mobile users in China, then all information service
fee of non-Beijing users recorded in each billing month shall be the
due information service fee of non-Beijing regions, which shall be
collected by local subsidiaries of China Mobile. Relevant local
subsidiaries of China Mobile will credit 85% local due information
service fee to Party A, which shall then be transferred to Party B by
Party A in full.
	 
	3.	 	In case the monthly short-message entries (downlink) sent by Party B to
nationwide users as recorded in the gateway billing data exceeds those sent
by users to Party B (uplink), thus resulting in ill-balanced communication
fee of Party B (the balance of downlink messages and uplink messages is
the ill-balance communication), Party A shall charge RMB 0.05-0.10
yuan/message for the ill-balance communication as follows:

	 	 	 	 	 	 	 
	Ill-balanced	 	 	 	 
	downlink SM	 	Fee	 	 
	traffic	 	standard (RMB	 	Calculation methods
	(messages/month)	 	yuan/message)	 	X=(MT-MO) message/month
	 
	Below 100,000

	 	 	0.08	 	 	X*0.08, at least RMB 2000 yuan
	100,000-300,000

	 	 	0.07	 	 	(X-100,000)*0.07+100,000*0.08
	300,000-1 million

	 	 	0.06	 	 	(X-300,000)*0.06+200,000*0.07+100,000*0.08
	Over 1 million

	 	 	0.05	 	 	(X-1
	

	 	 	 	 	 	million)*0.05+700,000*0.06+200,000*0.07+10
0,000*0.08

IV. Settlement Method

1. Settlement point: determined by Party A.

2. Settlement methods

	1)	 	Party B shall link with the short-message center of Party A via the
short-message gateway of Party A, which shall record the billing data
as final. The monthly settlement from the 15th day to the 20th day
each month shall cover the fee of the last month from the 1st day to
the last day. After the normal billing accounting period, Party A
shall calculate the current-month information service fee of Party B
and the ill-balance communication fee payable to Party A, which shall
serve as the basis of settlement between the parties.
	 
	2)	 	The parties shall make the account settlement of the current-month
information service fee according to the records of the billing system
of Party A. Both party shall settle the fee based on the 85% portion
of information service fee minus the ill-balance communication fee. In
case the balance is positive, Party a shall pay the balance to Party B
and Party B shall issue service industry invoices to Party A. In case
the balance is negative, Party B shall pay the balance to Party A and

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	 	 	Party A shall issue service industry invoices to Party B. The payment
collecting party shall mail the service industry invoice within three
(3) days after the receipt of the payment (by local post stamp).
	 
	3)	 	The parties shall make the settlement and payment strictly according
to the regulations of settlement model and schedule. In case either
party delays the due payment beyond the stipulated time (the 20th day
each month), the party shall pay to the other party the delay penalty
at the daily rate of 0.1% of the delayed payment. In case either party
fails to make payment overdue for over 2 months after the notice of
the other party, the conforming party is entitled to lodge an action
against the default party with the legal liability borne by the
default party.

V. Marketing and Promotion

	1.	 	The parties shall engage in joint marketing and promotion with their
respective resources in the principle of mutual benefit.
	 
	2.	 	Party A in general shall market/promote Monternet and the major
categories of application services instead of the cooperative
Monternet services separately.
	 
	3.	 	Party B shall market/promote its brand and relevant Monternet services
as well as the brand of Monternet. Party B shall strictly abide by the
brand/marks regulations of Party A in use of Monternet LOGO without
unauthorized distortion or color change with prior approval of Party A
prior to any use thereof.
	 
	4.	 	Party B shall not use Monternet brand for any purpose other than the
marketing/promotion of Monternet services, otherwise Party A is
entitled to require Party B to stop the use thereof and bear any
liability thus incurred, or even claim the legal liability for severe
violations.
	 
	5.	 	Party B must obviously indicate the customer service phone or customer
service Website, compliant email on any promotional material and media
ads. of Monternet business. Party B shall not adopt the similar
products of China Mobile rivals as the promotional gifts of Monternet
business.

VI. Customer Services

	1.	 	The Monternet short messages received by users must be those upon their request or
customization. Party B shall ensure the wholesomeness and legality of the short messages
sent to users, Party A is entitled to supervise the short message contents of Party B, and
strengthen the management thereof, specific regulations as provided for in Exhibit 3.
	 
	2.	 	Party B shall fully inform users of the basic elements of Monternet services prior to any
ordering, including price, sending frequency/times, use model, major contents and etc.
	 
	3.	 	Party A shall process the customer inquiries and complaints arising out of the
communication network problems.

7

 

	4.	 	Party A’s customer service center 1860 and the major outlets will handle the customer
inquiries and complaints about Monternet services, and transfer any customer problem about
information content and services to the customer service center of Party B.
	 
	5.	 	Party B shall keep 24*7 hotline, and inform users thereabout in the Web pages or marketing.
	 
	6.	 	Party B shall assign regular staff to handle user complaints, and respond to customer
complaint within one (1) day thereafter.
	 
	7.	 	To ensure the user understanding of Party B’s services, Party B must process the service
recommendations, customer service instructions and the downlink information of user
passwords free of charge, and send the service prompt information (e.g. price,
customization confirmation, customer service hotline, order rejection and etc) free of
information service fee.
	 
	8.	 	For monthly-payment short-message services, Party B may charge the monthly fee at the user
for the use of the service between half a month to a month, and charge no fee at the user
for the use of the service below half a month.
	 
	9.	 	For users in request of customized services via Internet, Party B shall obviously indicate
the basic business information on the Web page prior to the user confirmation of the
customization. After successful customization, Party B shall send the prompt information
to users, stating “thanks to you”, “successful confirmation of the customization”,
“service information fee standard”, “sending frequency/times”, “order withdrawal
method”, “customer service phone/Website”.
	 
	10.	 	For users of customized services via mobile phones, Party B shall return the prompt
information via short message to the users (including paid users and third-party users)
immediately, stating “thanks to you”, “successful confirmation of the customization”,
“service information fee standard”, “sending frequency/times”, “order withdrawal method”,
“customer service phone”, “Website” (optional).
	 
	11.	 	To the initial ordering intentions acquired in the non-online marketing (e.g. filling out
forms), Party B shall send the second confirmation message (basic service information),
and confirm the actual order after user confirmation of the password.

VII. Termination

	1.	 	Party B shall not send any information to invalid Monternet users. In
case Party B knowingly send information to invalid Monternet users,
Party A is entitled to require Party B to indemnify the economic loss
incurred from user overdue payment, and is entitled to terminate this Agreement and the cooperation hereunder.
	 
	2.	 	Party B is obligated to ensure the compliance of its information
content with Telecom Regulations of PRC, Internet Information Service
Regulations and other applicable laws, regulations and

8

 

	 	 	policies, not
distribute any illegal and obscene information undermining the
national security and interest, Party B shall ensure that its
information content shall not impair the corporate image of China
Mobile. Without written consent of Party A, Party B shall not send ads
and other irrelevant information to mobile users via the short-message
ports furnished by Party A. Otherwise, Party B shall indemnify Party A
for any loss thus incurred, and Party A is entitled to terminate this
Agreement and the cooperation hereunder.
	 
	3.	 	Upon the receipt of user complaint for receiving any un-requested
message from Party B, Party A shall notify Party B accordingly, and
Party B shall investigate the reasons. In this case, Party A shall not
charge user any fee, and return any fee collected back to the users,
and Party A is entitled to terminate this Agreement and the
cooperation hereunder according to the current-month severity of
customer complaints.
	 
	4.	 	To ensure the normal marketing of Monternet services, Party B shall
not directly or indirectly provide cross-operator short-message
services, including domestic cross-operator short-message services and
international short-message services, and shall not carry out
commission-based fee collection services via the short-message system
of Party A. Otherwise, Party B shall indemnify Party A for any loss
thus incurred, and Party A is entitled to terminate this Agreement and
the cooperation hereunder.
	 
	5.	 	In case Party A transfers customer complaints to Party B, Party B
shall initially respond to the customer service department of Party A
within two (2) hours, and investigate the reasons/handle the complaint
within one (1) working day. Party A is entitled to deduct RMB 500 yuan
per each customer complaint from the current-month due payment to
Party B as the default penalty, and Party A is entitled to terminate
this Agreement and the cooperation hereunder according to the default
severity.

VIII. Confidentiality

	1.	 	Proprietary Information refers to any valuable information developed,
created, found or disclosed to the receiving party by the disclosing
party. Proprietary Information includes but not limited to the trade
secrets, intellectual property rights (IPR) and technical secrets.
	 
	2.	 	The parties shall protect the IPR and other Proprietary Information
among other trade secrets of its own and the other party. Without
written consent of the other party, either party shall keep the
confidentiality of the Proprietary Information of the other party, and
shall not disclose any Proprietary Information involving with the
trade secrets and technical secrets of the other party to any third
party.
	 
	3.	 	The parties shall keep the confidentiality of this cooperation and
this Agreement. Without prior written consent of the other party,
either party shall disclose the details of the cooperation and this
Agreement to any third party.

IX. Default Liability

9

 

Failure of either party to perform any provision hereunder shall be deemed as
default. Upon receipt of the other party’s written notice of the default, the
default party, if confirming the default, shall correct the default within
twenty (20) days thereafter with written notice to the other party. It the
notified party denies the default, it shall inform the other party thereof
within twenty (20) days or sate the reasons therefor. In this case, the parties
shall settle the dispute via consultation, or resort to the dispute settlement
provisions hereunder for any dispute failing friendly consultation, the default
party shall be liable for the loss thus incurred to the conforming party.

X. Liability Limitation

In case both party or either party fails to perform, partly or as a whole, the
obligations hereunder due to force majeure event, neither party shall be held
liable for the default liability. However, the affected party or the parties
shall notify the other party within fifteen (15) days thereafter and furnish
relevant supporting evidence. Either party or both parties shall resume the
performance of this Agreement after the elimination of the force majeure.

XI. Dispute Settlement

The parties may settle the dispute arising out of the performance hereunder via
friendly consultation. Either party may submit the dispute failing friendly
consultation to Beijing

Arbitration Committee for arbitration according to its rules. The arbitration
award is final and binding upon the parties.

XII. Effectiveness, Modification, Termination and Renewal of Agreement

	1.	 	This Agreement shall take effect from May 1, 2003, and expire upon October 31, 2003. In
case the parties do not terminate this Agreement upon the expiration, this Agreement shall
automatically renew for another 6 months. The party rejecting the renewal shall notify the
other party thirty (30) days in advance of the expiration in writing thereabout.
	 
	2.	 	This Agreement, 13 pages, is made in six (6) copies with each party holding three (3)
copies of equal validity. It shall take effect upon execution and stamp of the duly
authorized representatives of the parties.
	 
	3.	 	The exhibits hereto constitute an integral part of this Agreement with equal legal validity.
	 
	4.	 	During the term of this Agreement, the parties may modify the provision hereunder or
terminate this Agreement upon friendly consultation. Either party intending to change or
modify this Agreement shall notify the other party in writing thirty (30) days in advance.
The party unilaterally terminating this Agreement shall indemnify all loss thus incurred to
the other party.

10

 

	 	 	 
	Party A (seal):

	 	Party B (seal):
	 
	 	 
	Representative: Xiang Wenjie

	 	Representative: Benjamin Tsiang

	 	 	 	 	 	 	 
	Exhibits:

	 	 	1.	 	 	Monthly statistic report of Monternet business
	

	 	 	2.	 	 	Procedures for adding new services
	

	 	 	3.	 	 	Regulations of Monternet short message contents

11

 

Exhibit 1: Monthly Statistic Report of Monternet Business

Table 1: Nationwide service based on short messages

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	SP corporate	 	 	 	New registered	 	Current-month	 	Current-month	 	Short-message
	S.N.
	 	code
	 	SP name
	 	users
	 	users
	 	premium users
	 	items

	1
	 	 	 	 	 	 	 	 	 	 	 	 

Table 2: Local service based on short message

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	SP corporate	 	 	 	 	 	New registered	 	Current-month	 	Current-month	 	Short-message
	S.N.
	 	code
	 	SP name
	 	users
	 	users
	 	premium users
	 	items

	Note: 	 	 	 
	 
	1.	 	 	New registered users: additional users logging on and registering via the service end of certain
SP in the current month.
	 
	2.	 	 	Current-month users: users in use of the short-message service of the SP at least once in the
current month.
	 
	3.	 	 	Current-month premium users: registered users in use of SP premium services in the current month.
	 
	4.	 	 	Short-message items: all short messages sent and received to our gateway via the SP service end
in the current month.
	 
	5.	 	 	SP engaged in nationwide short-message services shall fill out table 1, and SP engaged in local
short-message services should fill out table 2.

12

 

Exhibit 2 Procedures for Adding New Services

	1.	 	Party B shall report to Party A the new services within the first 5
days each month in the standard format, any services not reported
during the period shall be automatically transferred to the next
month.
	 
	2.	 	Party A shall respond to the new service application of Party B within
three (3) working days as to whether to allow test.
	 
	3.	 	The test period of Party B is the first 25 days each month, Party B
shall promptly submit the test reports to Party A, Party A shall check
the test report and promptly respond to Party B. Party A shall not
accept test reports submitted beyond the above period.
	 
	4.	 	After the test, if the parties deem the test successful, Party A shall
notify Party B within five (5) working days as to the formal cutover
date. In case unsuccessful test, the test will be terminated, or Party
B shall make another test in the next test period.

Remarks: future business management regulations of China Mobile will prevail.

13

 

Exhibit 3:
Management Regulations of Monternet Short Message Contents

Chapter 1 General

     Article 1 To ensure the wholesome development of China Mobile Monternet
Program, safeguard the long-term interest of the operators and partners, and
protect legal rights of all users, Beijing Mobile Communications Corporation hereby
promulgates the Management Regulations of Monternet Short Message Contents
according to Internet Information Management Regulations of China and Monternet
Service Content Review/management Methods of China Mobile.

     Article 2 This Regulation shall make open and transparent supervision
of the short message contents of all SPS providing Monternet services in the
principle of fairness and equality.

     Article 3 This Regulation is subject to amendment and supplement based
on the market changes, which shall prevail over the original version.

Chapter 2 Requirements on Short Message Contents

     Article 4 It is prohibited to make impolite and obscene personal attack
to mobile phone users of China Mobile via the short message words/languages in
any manner.

     Article 5 It is prohibited to undermine the image of China Mobile via
the short message words/languages in any manner.

     Article 6 It is prohibited to distribute obscene and indecent contents
via the short message words/languages in any manner.

     Article 7 It is prohibited to misguide user behaviors via the short
message words/languages in any manner in an effort to cheat users and incur
user loss.

Chapter 3 Examination Methods

     Article 8
Beijing Mobile Communications Corporation will make irregular spot check of
short message contents of SPs providing Monternet services.

     Article 9
Beijing Mobile Communications Corporation will make regular survey to
investigate the customer satisfaction of the short message contents of SPs.

     Article 10
Beijing Mobile Communications Corporation customer service center 1860 will
handle the customer complaint of the short message contents.

14

 

Chapter 4 Handling Method

     Article 11 When Beijing Mobile Communications Corporation aware of the prohibited short
message content, it will issue written warning to the SP and SP shall make
corrective action within three (3) days.

     Article 12 If no corrective action were make by SP, Beijing Mobile Communications Corporation
will issue the second written warning. SP shall examine and amend its short
message contents within three (3) days.

     Article 13 Beijing Mobile Communications Corporation will terminate contract with the SP
failing to correct prohibited content after the second warning, and order
correction within stipulated period based on the severity.

     Article 14 For SPs liable for prohibited contents during multiple spot
checks, frequency user complaints and failing prompt correction,
Beijing Mobile Communications Corporation will terminate contract with them and order correction within
stipulated period based on the severity.

Chapter 5 Supplement

     Article 15 This Regulation shall be interpreted by Marketing Department of
Beijing Mobile Communications Corporation.

     Article 16 This Regulation shall be enforced since the execution date (May
2001).

15

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