Ex. 10.44
Confidential
SHAREHOLDERS' VOTING RIGHTS
PROXY AGREEMENT
AMONG
SHANGHAI FOCUS MEDIA ADVERTISEMENT CO., LTD.
SHANGHAI FOCUS MEDIA CO., LTD.
SHANGHAI FRAMEDIA INVESTMENT CONSULTANCY CO., LTD
AND
LOCAL ADVERTISEMENT COMPANIES LISTED IN APPENDIX I
JANUARY 13, 2006
SHAREHOLDERS' VOTING RIGHTS PROXY AGREEMENT
This SHAREHOLDERS' VOTING RIGHTS PROXY AGREEMENT (this "AGREEMENT") is entered
into as of January 13, 2006 by and among the following Parties:
(1) SHANGHAI FOCUS MEDIA ADVERTISEMENT CO., LTD. (hereinafter "FOCUS MEDIA
ADVERTISEMENT")
REGISTERED ADDRESS: F Room 1003, Xx.0000, Xxxxxxxxx Xxxx, Xxxxxxxxx
Xxxxxxxx, Xxxxxxxx
LEGAL REPRESENTATIVE: Xxxxx Xxxxxxx Xxxxx
(2) SHANGHAI FOCUS MEDIA CO., LTD.(HEREINAFTER "FOCUS MEDIA")
REGISTERED ADDRESS: Xxxx X00, 00 Xxxxx, Xx.000, Xxxxxxx Xxxx, Xxxxxxxxx
Xxxxxxxx, Xxxxxxxx
LEGAL REPRESENTATIVE: Xxxxx Xxxxxxx Xxxxx
(3) SHANGHAI FRAMEDIA INVESTMENT CONSULTANCY CO., LTD (HEREINAFTER "FRAMEDIA
INVESTMENT")
REGISTERED ADDRESS: Xxxx 0, 00 Xxx, Xxxxxxxx Xx., Xxxxxxxx
LEGAL REPRESENTATIVE: Xxxxx Xxxxxxx Xxxxx
(4) THE LOCAL ADVERTISEMENT COMPANIES LISTED IN APPENDIX I TO THE AGREEMENT.
(The above Parties hereinafter each referred to as a "PARTY" individually, and
collectively, the "PARTIES". Among them, Focus Media Advertisement and Focus
Media hereinafter referred to as a "SHAREHOLDER" individually, and collectively,
the "SHAREHOLDERS".)
WHEREAS:
1. As of the date of the Agreement the Shareholders are the enrolled
shareholders of the companies listed in Appendix I to this Agreement,
legally holding jointly all the equity interest in the companies listed in
Appendix I to this Agreement;
2. The Shareholders intend to severally entrust the individual designated by
Framedia Investment with the exercises of their voting rights in Target
Company (as defined below) while Framedia Investment is willing to
designate such an individual.
The Parties hereby have reached the following agreement upon friendly
consultations:
ARTICLE 1 VOTING RIGHTS ENTRUSTMENT
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1.1 Under this Agreement, "TARGET COMPANY" shall mean any and all companies
listed in Appendix I.
1.2 The Shareholders hereby irrevocably undertake to respectively sign the
Entrustment Letter after execution of the Agreement to respectively entrust
the one designated by Framedia Investment (collectively, "TRUSTEES") to
exercise the following rights respectively 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 Framedia Investment. Upon and
only upon written notice of dismissing and replacing Trustee(s) given by
Framedia Investment to the Shareholders, the Shareholders shall promptly
entrust another PRC citizen then designated by Framedia Investment 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
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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).
3.3 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 Framedia Investment 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 Framedia Investment under this Agreement.
4.2 Target Company and the Shareholders agree to compensate Framedia Investment
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 Framedia Investment, 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 Framedia Investment.
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 Shareholders is a company with limited liability duly
organized and validly existing under the PRC Law and is a company with
full and independent legal status and legal capacity to execute,
deliver and perform this Agreement, and may act independently as a
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litigant party.
5.1.2 Each of the Shareholders has full power and authorization to execute
and deliver this Agreement and all the other documents to be entered
into by it in relation to the transaction referred to herein, and it
has the full power and authorization to complete the transaction
referred to herein.
5.1.3 The Shareholders are the enrolled legal owner of the Option Equity as
of the effective date of this Agreement, and except the rights created
by this Agreement, the Equity Pledge Agreement (the "EQUITY PLEDGE
AGREEMENT") and the Shareholders' Voting Rights Proxy Agreement (the
"PROXY AGREEMENT") entered into by the Shareholders, Target Companies
and Framedia Investment dated [__] 2006, there is no third party
rights on the Entrusted Right. 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.
5.2 Target Company hereby in respect of themselves respectively 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 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.
5.2.3 the Shareholders are enrolled shareholders as of the effective date
of this Agreement, legally holding the equity interest in it set out
in Appendix I. 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.
5.2.4 Considering the fact that the Shareholders of Target Company will set
aside all the equity interest held thereby in Target Company as
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security to secure the performance of the contractual obligations by
Target Company under the Call Option Agreement and Technology
Permission and Service Agreement, Target Company undertakes to, during
the valid term of this Agreement, make full and due performance of any
and all obligations under the Call Option Agreement and Technology
Permission and Service 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 Call Option Agreement and
Technology Permission and Service Agreement by Target Company.
ARTICLE 6 TERM OF AGREEMENT
6.1 Limited by the Article 6.2 and 6.3 of this Agreement, this Agreement shall
take effect as of the date of formal execution by the Parties with the term
of twenty (20) years, unless the Parties terminate the Agreement with the
written agreement in advance, or the Parties terminate the Agreement in
accordance with section 8.1 of this Agreement. Upon the expiration of this
Agreement, the Agreement will be automatically renewed for one (1) year,
unless Framedia Investment gives the other Parties written notice of its
intention not renew at least thirty (30) days prior to expiration.
6.2 In case that a Shareholder transfers all of the equity interest held by it
in Target Company with prior consent of Framedia Investment, such
Shareholder shall no longer be a Party to this Agreement (to the extent
that it acts as the shareholder of such Target Company) whilst the
obligations and commitments of the other Sarties under this Agreement shall
not be adversely affected thereby.
6.3 During the term of this Agreement, should the term of operation of any
Target Company terminate by any reason; this Agreement to such Target
Company and its shareholders (to the extent that it acts as the shareholder
of such Target Company) will be terminated.
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
(ii) it is delivered if delivered in person, or (iii) when five (5) days
have elapsed after posting the same if posted by mail.
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ARTICLE 8 DEFAULT LIABILITY
8.1 The Parties agree and confirm that, if any of the Parties (the "DEFAULTING
PARTY") breaches substantially any of the provisions herein or fails
substantially to perform any of the obligations hereunder, such a breach or
failure shall constitute a default under this Agreement (a "DEFAULT"). In
such event any of the other Parties without default (a "NON-DEFAULTING
PARTY") who incurs losses arising from such a Default shall have the right
to require the Defaulting Party to rectify such Default or take remedial
measures within a reasonable period. If the Defaulting Party fails to
rectify such Default or take remedial measures within such reasonable
period or within ten (10) days of a Non-defaulting Party's notifying the
Defaulting Party in writing and requiring it to rectify the Default, then
the relevant Non-defaulting Party shall be entitled to choose at its
discretion to (1) terminate this Agreement and require the Defaulting Party
to indemnify all damages, or (2) require specific performance by the
Defaulting Party of this Agreement and indemnifation against all damages.
8.2 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.
8.3 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 prepared in Chinese language in five (5) original
copies, with each involved Party holding one (1) copy hereof.
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
Partiesinvolved 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
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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 hereof.
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 Framedia Investment, 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 Framedia Investment;
Framedia Investment 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
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Companies.
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IN WITNESS HEREOF, the following Parties have caused this Shareholders' Voting
Rights Proxy Agreement to be executed as of the date and in the place first here
above mentioned.
SHANGHAI FOCUS MEDIA ADVERTISEMENT
CO., LTD.
(chop)
Signature by: /s/ Xxxxx Xxxxxxx Xxxxx
--------------------------
Name: Xxxxx Xxxxxxx Xxxxx
Position: Legal Representative
SHANGHAI FOCUS MEDIA CO., LTD
(chop)
Signature by: /s/ Xxxxx Xxxxxxx Xxxxx
--------------------------
Name: Xxxxx Xxxxxxx Xxxxx
Position: Legal Representative
SHANGHAI FRAMEDIA INVESTMENT CONSULTANCY
CO., LTD
(chop)
Signature by: /s/ Xxx Xxx
--------------------------
Name: Xxx Xxx
Position: Legal Representative
SHANGHAI FRAMEDIA ADVERTISEMENT
DEVELOPMENT CO., LTD
(chop)
Signature by: /s/ Xxxxx Xxxxxxx Xxxxx
--------------------------
Name: Xxxxx Xxxxxxx Xxxxx
Position: Legal Representative
SHANGHAI NEW FRAME ADVERTISEMENT
CO., LTD
(chop)
Signature by: /s/ Xxxxx Xxxxxxx Xxxxx
--------------------------
Name: Xxxxx Xxxxxxx Xxxxx
Position: Legal Representative
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APPENDIX I:
BASIC INFORMATION OF THE TARGET COMPANIES
REGISTERED REGISTERED LEGAL
COMPANY NAME ADDRESS CAPITAL (RMB) REPRESENTATIVE EQUITY STRUCTURE
------------ ------------ ------------- --------------- -----------------
Shanghai Framedia Xxxx 00, 1,000,000 Xxxxx Focus Media
Advertisement Development 77 Lane, Xxxxxxx Xxxxx Advertisement:
Co., Ltd Yueyang Rd. 90%
Focus Media:
10%
Shanghai New Frame Room 1, 1,000,000 Xxxxx Focus Media
Advertisement Co., Ltd 17 Lane, Xxxxxxx Xxxxx Advertisement:
Hengshan Rd. 90%
Focus Media:
10%
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