SHAREHOLDERS’ VOTING RIGHTS PROXY AGREEMENT
Exhibit 10.5
CONFIDENTIAL
Xxxxxxx
XXXX,
Xxxxxx
XXXX,
HANGZHOU
MYL COMMERCIAL SERVICE CO., LTD.
AND
HANGZHOU
MYL BUSINESS ADMINISTRATION CONSULTING CO., LTD.
MAY 1,
2009
This
SHAREHOLDERS’ VOTING RIGHTS PROXY AGREEMENT (this “AGREEMENT”) is entered into
on MAY 1, 2009 by and between:
(1)
Xxxxxxx XXXX
Address:
Xianjin Village, Tielu Town, Langao County, Shanxi Province, PRC
Identity
Card Number: 612426198009283412
(2)
Xxxxxx XXXX
Address:40
Lane No.1025, Liuying Rd., Zhabei District, Shanghai, PRC
Identity
Card Number: 310108198606112011
(3) Hangzhou
MYL Commercial Service Co., Ltd. (Hereinafter "Hangzhou MYL
Commercial)
Registered
Address: Room 603, 260 South Hushu Rd., Gongshu District; Hangzhou, Zhejiang,
PRC
Legal
Representative: Xxxxxxx XXXX
(4)
Hangzhou MYL Business Administration Consulting Co., Ltd..( "Hangzhou MYL
Consulting")
Registered
Address: Room 604, 260 South Hushu Rd., Gongshu District; Hangzhou, Zhejiang,
PRC
Legal
Representative: Kaien LIANG
The above
parties shall hereinafter be individually referred to as a “PARTY” and
collectively, “PARTIES”. Xxxxxxx XXXX and Xxxxxx XXXX shall hereinafter be
individually referred to as a “PERSONAL SHAREHOLDER” and collectively, “PERSONAL
SHAREHOLDERS”, Personal Shareholders and HANGZHOU MYL COMMERCIAL shall
hereinafter be individually referred to as a “SHAREHOLDER” and collectively,
“SHAREHOLDERS”.
WHEREAS:
1.
Xxxxxxx XXXX and Xxxxxx XXXX are the registered shareholders of HANGZHOU MYL
COMMERCIAL, legally holding all the equity in HANGZHOU MYL COMMERCIAL, of which
Xxxxxxx XXXX holding 70% interest and Xxxxxx XXXX 30%.
2. The
Shareholders intend to severally entrust the individual designated by Hangzhou
MYL Consulting with the exercises of their voting rights in Target Company (as
defined below) while Hangzhou MYL Consulting is willing to designate such an
individual.
The
Parties hereby have reached the following agreement upon friendly
consultations:
ARTICLE
1 VOTING RIGHTS ENTRUSTMENT
1.1 Under
this Agreement, “TARGET COMPANY” shall mean, to Xxxxxxx XXXX and Xxxxxx XXXX,
HANGZHOU MYL COMMERCIAL; and to HANGZHOU MYL COMMERCIAL, any and all of its
Subsidiaries to be established.
1.2 The
Shareholders hereby irrevocably undertake to respectively sign the Entrustment
Letter after execution of the Agreement to respectively entrust the personnel
designated by Hangzhou MYL Consulting then (“TRUSTEES”) to exercise the
following rights enjoyed by them as shareholders of Target Company in accordance
with the then effective articles of association of Target Company (collectively,
the “ENTRUSTED RIGHTS”):
(1) Proposing
to convene and attending shareholders’ meetings of Target Company as proxy of
the Shareholders according to the articles of association of Target
Company;
(2) Exercising
voting rights as proxy of the Shareholders, on issues discussed and resolved by
the shareholders’ meeting of Target Company, including but not limited to the
appointment and election for the directors, general manager and other senior
management personnel of Target Company.
The above
authorization and entrustment is granted subject to the status of trustees as
PRC citizens and the approval by Hangzhou MYL Consulting. Upon and only upon
written notice of dismissing and replacing Trustee(s) given by Hangzhou MYL
Consulting to the Shareholders, the Shareholders shall promptly entrust another
PRC citizen then designated by Hangzhou MYL Consulting to exercise the above
Entrusted Rights, and once new entrustment is made, the original entrustment
shall be replaced; the Shareholders shall not cancel the authorization and
entrustment of the Trustee(s) otherwise.
1.3 The
Trustees shall perform the entrusted obligation within the scope of entrustment
in due care and prudence and in compliance with laws; the Shareholders
acknowledge and assume relevant liabilities for any legal consequences of the
Trustees’ exercise of the foregoing Entrusted Rights.
1.4 The
Shareholders hereby acknowledge that the Trustees are not required to seek
advice from the Shareholders prior to their respective exercise of the foregoing
Entrusted Rights. However, the Trustees shall inform the Shareholders in a
timely manner of any resolution or proposal on convening interim shareholders’
meeting after such resolution or proposal is made.
ARTICLE
2 RIGHT TO INFORMATION
2.1 For
the purpose of exercising the Entrusted Rights under this Agreement, the
Trustees are entitled to know the information with regard to Target Company’s
operation, business, clients, finance, staff, etc., and shall have access to
relevant materials of Target Company. Target Company shall adequately cooperate
with the Trustees in this regard.
ARTICLE
3 EXERCISE OF ENTRUSTED RIGHTS
3.1 The
Shareholders will provide adequate assistance to the exercise of the Entrusted
Rights by the Trustees, including execution of the resolutions of the
shareholders’ meeting of Target Company or other pertinent legal documents made
by the Trustee when necessary (e.g., when it is necessary for examination and
approval of or registration or filing with governmental
departments).
3.2 If
at any time during the term of this Agreement, the entrustment or exercise of
the Entrusted Rights under this Agreement is unenforceable for any reason except
for default of any Shareholder or Target Company, the Parties shall immediately
seek a most similar substitute for the unenforceable provision and, if
necessary, enter into supplementary agreement to amend or adjust the provisions
herein, in order to ensure the realization of the purpose of this
Agreement.
ARTICLE
4 EXEMPTION AND COMPENSATION
4.1 The
Parties acknowledge that Hangzhou MYL Consulting shall not be requested to be
liable for or compensate (monetary or otherwise) other Parties or any third
party due to exercise of Entrusted Rights by the Trustees designated by Hangzhou
MYL Consulting under this Agreement.
4.2 Target
Company and the Shareholders agree to compensate Hangzhou MYL Consulting for and
hold it harmless against all losses incurred or likely to be incurred by it due
to exercise of the Entrusted Rights by the Trustees designated by Hangzhou MYL
Consulting, including without limitation any loss resulting from any litigation,
demand arbitration or claim initiated or raised by any third party against it or
from administrative investigation or penalty of governmental
authorities.
However,
the Shareholders and Target Company will not compensate for losses incurred due
to wilful misconduct or gross negligence of Hangzhou MYL
Consulting.
ARTICLE
5 REPRESENTATIONS AND WARRANTIES
5.1
Each of the Personal Shareholders hereby severally and jointly represents and
warrants that:
5.1.1 Each
of the Personal Shareholders is a PRC citizen with full capacity and with full
and independent legal status and legal capacity to execute, deliver and perform
this Agreement, and may act independently as a subject of actions.
5.1.2 Each
of the Personal Shareholders has full right and authorization to execute and
deliver this Agreement and other documents that are related to the transaction
referred to herein and to be executed by them. They have full right and
authorization with respect to consummate the transaction referred to
herein.
5.1.3 This
Agreement shall be executed and delivered by the Personal Shareholders lawfully
and properly. This Agreement constitutes the legal and binding obligations on
them and is enforceable on them in accordance with its terms and conditions
hereof.
5.1.4 The
Personal Shareholders are registered and legal shareholders of Target Company as
of the effective date of this Agreement, and except the rights created by this
Agreement, the Call Option Agreement entered into by Hangzhou MYL Consulting,
Target Companies and them on MAY 1, 2009 (the “CALL OPTION AGREEMENT”), as well
as the Equity Pledge Agreement entered into by Hangzhou MYL Consulting and
Target Company and them on MAY 1, 2009, (the “EQUITY PLEDGE AGREEMENT”), there
exists no third party right on the Entrusted Rights. Pursuant to this Agreement,
the Trustees may fully and sufficiently exercise the Entrusted Rights in
accordance with the then effective articles of association of Target
Company.
5.1.5 Considering
the fact that according to Equity Pledge Agreement, considering the fact that
Personal Shareholders will set aside all the equity interest held thereby in
relevant Target Company as security to secure the performance by them of their
obligations under the Call Option Agreement entered into between them
respectively and Hangzhou MYL Consulting as of MAY 1, 2009, Personal
Shareholders undertake to make full and due performance of the obligations under
Call Option Agreement during the valid term of this Agreement, and they will not
be in conflict with any stipulation under Call Option Agreement, which are
likely to have impact on the exercise of he Entrusted Rights the Trustees under
this Agreement.
5.1.6 Considering
the facts that the Target Company entered into the Exclusive Agreement (the
“SERVICE AGREEMENT”) on MAY 1, 2009 with Hangzhou MYL Consulting, the Call
Option Agreement with Hangzhou MYL Consulting and the Shareholders on MAY 1,
2009, and that the Shareholders of Target Company will set aside all equity
interest held thereby in Target Company as security to secure the performance of
the contractual obligations under the above two agreements by Target Company,
the Personal Shareholders undertake to, during the valid term of this Agreement,
procure the full and due performance of Target Company of any and all its
obligations under the Service Agreement, the Call Option Agreement, and warrant
that no adverse impact on the exercise of the Entrusted Rights hereunder by the
Trustees will be incurred due to the breach of the Exclusive Service Agreement,
Call Option Agreement by Target Company.
5.2
Hangzhou MYL Consulting (excluding the person designated by it) hereby
represents and warrants that:
5.2.1 it
is a company with limited liability properly registered and legally existing
under PRC laws, with an independent corporate legal person status, and with full
and independent legal status and legal capacity to execute, deliver and perform
this Agreement and may act independently as a subject of actions;
and
5.2.2 it
has the full corporate power and authority to execute and deliver this Agreement
and all the other documents to be entered into by it in relation to the
transaction contemplated hereunder, and has the full power and authority to
consummate such transaction.
5.3
HANGZHOU MYL COMMERCIAL hereby represents and warrants that any Target
Company:
5.3.1 will
be a company or entity with limited liability properly registered and legally
existing under PRC laws, with an independent legal person status, and with full
and independent legal status and legal capacity to execute, deliver and perform
this Agreement and may act independently as a subject of actions;
and
5.3.2 will
have the full corporate power and authority to execute and deliver this
Agreement and all the other documents to be entered into by it in relation to
the transaction contemplated hereunder, and has the full power and authority to
consummate such transaction.
5.3.3 the
Shareholders are registered shareholders as of the effective date of this
Agreement, legally holding the equity interest in such Target Company. Except
rights created by this Agreement, the Equity Pledge Agreement and the Call
Option Agreement, there exists no third party right on the Entrusted Rights.
Pursuant to this Agreement, the Trustees may fully and sufficiently exercise the
Entrusted Rights in accordance with the then effective articles of association
of Target Company.
5.3.4 Considering
the fact that the Shareholders of Target Company will set aside all the equity
interest held thereby in Target Company as security to secure the performance of
the contractual obligations by Target Company under the Exclusive Service
Agreement, the Call Option Agreement, Target Company will undertake to, during
the valid term of this Agreement, make full and due performance of any and all
obligations under the Exclusive Service Agreement, the Call Option Agreement,
and warrant that no adverse impact on the exercise of the Entrusted Rights
hereunder by the Trustees will be incurred due to the breach of the Exclusive
Service Agreement, the Call Option Agreement by Target Company.
5.4
HANGZHOU MYL COMMERCIAL hereby in respect of itself represents and
warrants that:
5.4.1 it
is a company with limited liability properly registered and legally existing
under PRC laws, with an independent legal person status, and with full and
independent legal status and legal capacity to execute, deliver and perform this
Agreement and may act independently as a subject of actions; and
5.4.2 it
has the full corporate power and authority to execute and deliver this Agreement
and all the other documents to be entered into by it in relation to the
transaction contemplated hereunder, and has the full power and authority to
consummate such transaction.
5.4.3 As
of the effective date of this Agreement, Xxxxxxx XXXX and Xxxxxx XXXX are
registered shareholders, legally holding the equity interest in HANGZHOU MYL
COMMERCIAL. Except rights created by this Agreement, the Equity
Pledge Agreement and the Call Option Agreement, in respect of HANGZHOU MYL
COMMERCIAL, there exists no third party right on the Entrusted Rights. Pursuant
to this Agreement, the Trustees may fully and sufficiently exercise the
Entrusted Rights according to the then effective articles of association of
HANGZHOU MYL COMMERCIAL.
5.4.4 As
of the effective date of this Agreement and in respect of Target Company in
which it holds equity interest, it is registered shareholder. Except rights
created by this Agreement, the Call Option Agreement and the Equity Pledge
Agreement, there exists no third party right on the Entrusted
Rights. Pursuant to this Agreement, the Trustees may fully and
sufficiently exercise the Entrusted Rights according to the then effective
articles of association of Target Company.
5.4.5 Considering
the fact that according to the Equity Pledge Agreement, it shall set aside all
equity interest held thereby in relevant Target Company as security to secure
the performance of its obligations under the Call Option Agreement. HANGZHOU MYL
COMMERCIAL undertakes to make full and due performance of the Call Option
Agreement during the valid term of this Agreement and that it will not be in
conflict with any term under the Call Option Agreement, which may have impact on
the exercise of the Entrusted Rights by the Trustees under this
Agreement.
5.4.6 Considering
the fact that according to the Equity Pledge Agreement, that Shareholders of
Target Company will set aside all the equity interest held thereby in Target
Company as security to secure the performance of the contractual obligations by
Target Company under the Exclusive Service Agreement, Call Option Agreement,
HANGZHOU MYL COMMERCIAL undertakes to, during the valid term of this Agreement,
procure the full and due performance of any and all obligations under the
Exclusive Service Agreement and Call Option Agreement by the Target Company in
which it holds equity interest, and warrants that no adverse impact on the
exercise of the Entrusted Rights hereunder by the Trustees will be incurred due
to breaching the Exclusive Service Agreement, or Call Option Agreement by Target
Company.
ARTICLE
6 TERM OF AGREEMENT
6.1 This
Agreement takes effect as of May 1, 2009. Unless earlier terminated by any of
the Parties in writing, this Agreement shall be valid for a term of five (5)
years commencing May 1, 2009; provided that it shall be deemed to be
automatically extended for another five (5) years starting from the expiration
date unless Hangzhou MYL Consulting sends a written notice indicating its
objection to extending of this agreement..
6.2 In
case that a Shareholder transfers all of the equity interest held by it in
Target Company with prior consent of Hangzhou MYL Consulting, such Shareholder
shall no longer be a Party to this Agreement whilst the obligations and
commitments of the other Parties under this Agreement shall not be adversely
affected thereby.
ARTICLE
7 NOTICE
7.1 Any
notice, request, demand and other correspondences made as required by or in
accordance with this Agreement shall be made in writing and delivered to the
relevant Party.
7.2 The
abovementioned notice or other correspondences shall be deemed to have been
delivered when (i) it is transmitted if transmitted by facsimile or telex, or
(ii) it is delivered if delivered in person, or (iii) when five (5) days have
elapsed after posting the same if posted by mail.
ARTICLE 8 DEFAULT
LIABILITY
8.1 The
Parties agree and confirm that, if any Party (the “DEFAULTING PARTY”) breaches
substantially any provision hereof, or fails substantially to perform any of the
obligations hereunder, such breach or failure shall constitute a default
hereunder ( “DEFAULT”), then the non-defaulting Party shall have the right to
require the Defaulting Party to make remedy within a reasonably specified
period. If the Defaulting Party fails to make remedy within such reasonable
period or within ten (10) days after the non-defaulting Party notifying the
Defaulting Party in writing and requiring it to make remedy, then the
non-defaulting Party shall have the right, at its sole discretion, to (1)
terminate this Agreement and require the Defaulting Party to keep it fully
indemnified; or (2) to require specific performance by the Defaulting Party of
this Agreement and to keep it fully indemnified.
8.2 Without
limiting the generality of Article 8.1 above, any breach by any Shareholder of
the Call Option Agreement or Equity Pledge Agreement shall be deemed as having
constituted the breach by such Shareholder of this Agreement; any breach by
Target Company of the Exclusive Service Agreement or Call Option Agreement shall
be deemed as having constituted the breach by Target Company of this
Agreement.
8.3 The
Parties agree and confirm, the Shareholders or Target Company shall not request
the termination of this Agreement for whatsoever reason and under whatsoever
circumstance, except otherwise stipulated by laws or this
Agreement.
8.4 Notwithstanding
any other provisions herein, the validity of this Article shall not be affected
by the suspension or termination of this Agreement.
ARTICLE
9 MISCELLANEOUS
9.1 This
Agreement shall be made in Chinese and English in quadruplicate, with each
involved Party holding one (1).
9.2
The
conclusion, validity, execution, amendment, interpretation and termination of
this Agreement shall be governed by laws of the PRC.
9.3 Any disputes arising from and in connection with this Agreement shall be settled through consultations among the Parties involved, and if the Parties involved fail to reach an agreement regarding such a dispute within thirty (30) days of its occurrence, such dispute shall be submitted to China International Economic and Trade Arbitration Commission Shanghai Branch for arbitration in Shanghai in accordance with the arbitration rules of such commission, and the arbitration award shall be final and binding on all the Parties involved.
9.4 Any
rights, powers and remedies empowered to any Party by any provisions herein
shall not preclude any other rights, powers and remedies enjoyed by such Party
in accordance with laws and other provisions under this Agreement, and a Party’s
exercise of any of its rights, powers and remedies shall not preclude its
exercise of other rights, powers and remedies of it.
9.5 Any
failure or delay by a Party in exercising any of its rights, powers and remedies
hereunder or in accordance with laws (the “PARTY’S RIGHTS”) shall not lead to a
waiver of such rights, and the waiver of any single or partial exercise of the
Party’s Rights shall not preclude such Party from exercising such rights in any
other way or exercising the remaining part of the Party’s Rights.
9.6 The
titles of the Articles contained herein are for reference only, and in no
circumstances shall such titles be used for or affect the interpretation of the
provisions
9.7 Each
provision contained herein shall be severable and independent from each of other
provisions. If at any time any one or more articles herein become invalid,
illegal or unenforceable, the validity, legality or enforceability of the
remaining provisions herein shall not be affected thereby.
9.8 Upon
execution, this Agreement shall replace any other previous legal documents
entered into by relevant Parties on the same subject matter.
9.9 Any
amendments or supplements to this Agreement shall be made in writing and shall
take effect only when properly signed by the Parties to this Agreement.
Notwithstanding the preceding sentence, considering that the rights and
obligations of each Target Company and its Shareholders are independent and
severable from each other, in case that the amendment or supplement to this
Agreement is intended to have impact upon one of the Target Companies and its
Shareholders, such amendment or supplement requires only the approval of
Hangzhou MYL Consulting, the Target Company and its Shareholder while no consent
is necessary from the other Target Companies and their Shareholders (to the
extent that the amendment or supplement does not have impact upon such other
Shareholders).
9.10 In
respect of the Shareholder and Target Company, they shall not assign any of
their rights and/or transfer any of their obligations hereunder to any third
parties without prior written consent from Hangzhou MYL Consulting; Hangzhou MYL
Consulting shall have the right to assign any of its rights and/or transfer any
of its obligations hereunder to any third parties designated by it after giving
notice to the Shareholders.
9.11 This
Agreement shall be binding on the legal successors of the Parties.
9.12 The
rights and obligations of Target Companies are severable and independent,
performance of this Agreement by any Shareholder and any Target Company shall
not affect the performance by the other Shareholders and other Target
Companies.
9.13 Notwithstanding
any provision to the contrary in this Agreement, new companies other than the
Target Companies and their shareholder(s) can be included as one party to this
Agreement by signing the Acknowledgement Letter in the form of Appendix to this
Agreement. The new companies shall enjoy the same rights and assume the same
obligations as other Target Companies; the shareholder(s) of the new companies
shall enjoy the same rights and assume obligations as the other Shareholders
hereunder. Since the rights and obligations of the Target Company and its
Shareholder(s) under the Agreement are severable and independent, the
participation of the new target companies and their shareholders will not affect
the rights and obligations of the original Target Company and its Shareholders,
the participation of the new target companies only requires confirmation of
Hangzhou MYL Consulting by signing. Each of the Target Companies hereby
irrevocably and unconditionally agrees to the participation of the new companies
and their shareholders, and further confirms that the shareholder(s) of any new
target company can entrust the Trustees to exercise the voting rights according
to the terms of this Agreement not necessarily with consent of the original
Target Companies or their relevant Shareholder(s).
[The
remainder of this page is left blank]
IN
WITNESS HEREOF, the following Parties have caused this Shareholders’ Voting
Rights Proxy Agreement to be executed as of the date first here above
mentioned.
Xxxxxxx
XXXX
Signature
by: /s/
Xxxxxx
XXXX
Signature
by: /s/
Hangzhou
MYL Commercial Service Co., Ltd.
Signed
by: /s/
Name:
Position:
Hangzhou
MYL Business Administration Consulting Co., Ltd.
Name:
Position:
APPENDIX
II
ACKNOWLEDGEMENT
LETTER
Name:
ID No.
(for a individual): _______________/or registered address (for an
entity):
("PARTICIPATING
SHAREHOLDER")
and
Name of
entity:
registered
address: ____________________
("PARTICIPATING
TARGET COMPANY")
hereby
agree to participate each as an independent party in the Shareholders' Voting
Rights Proxy Agreement dated MAY 1, 2009 among Hangzhou MYL Business
Administration Consulting Co., Ltd. and other relevant parties ("PROXY
AGREEMENT"). Participating Shareholder and Participated Target Company agree to
entrust the Trustees designated by Hangzhou MYL Consulting to exercise the
voting rights in Participating Target Company in respect of ___% of the equity
interest in the registered capital of Participating Target Company held by the
Participating Shareholder as of the date of the Acknowledgement Letter, on
behalf of Participating Shareholder.
By
signing this Acknowledgement Letter, the Participating Shareholder and
Participated Target Company shall be deemed to have made the same undertakings
and warranties as those of the Shareholders and Target Companies under the Proxy
Agreement, to agree to respectively perform the same obligations as the
Shareholders and Target Companies thereunder, and to acknowledge the rights and
obligations of the Parties thereunder.
PARTICIPATING
SHAREHOLDERS
Signed by
: _____________
Name:
Position:
PARTICIPATING
TARGET COMPANY
Signed by
: _____________
Name:
Position:
Hangzhou
MYL Business Administration Consulting Co., Ltd.
Signed by
: _____________
Name:
Position:
