0000898432-13-001034.txt : 20130719 0000898432-13-001034.hdr.sgml : 20130719 20130719061921 ACCESSION NUMBER: 0000898432-13-001034 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20130719 DATE AS OF CHANGE: 20130719 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: YOU ON DEMAND HOLDINGS, INC. CENTRAL INDEX KEY: 0000837852 STANDARD INDUSTRIAL CLASSIFICATION: CABLE & OTHER PAY TELEVISION SERVICES [4841] IRS NUMBER: 201777837 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-46316 FILM NUMBER: 13975877 BUSINESS ADDRESS: STREET 1: 27 UNION SQUARE, WEST STREET 2: SUITE 502 CITY: NEW YORK STATE: NY ZIP: 10003 BUSINESS PHONE: 212-206-1216 MAIL ADDRESS: STREET 1: 27 UNION SQUARE, WEST STREET 2: SUITE 502 CITY: NEW YORK STATE: NY ZIP: 10003 FORMER COMPANY: FORMER CONFORMED NAME: CHINA BROADBAND INC DATE OF NAME CHANGE: 20070516 FORMER COMPANY: FORMER CONFORMED NAME: ALPHA NUTRA INC DATE OF NAME CHANGE: 20060922 FORMER COMPANY: FORMER CONFORMED NAME: ALPHA NUTRACEUTICALS INC DATE OF NAME CHANGE: 20040115 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: MCMAHON SHANE CENTRAL INDEX KEY: 0001180421 FILING VALUES: FORM TYPE: SC 13D/A MAIL ADDRESS: STREET 1: 1241 EST MAIN STREET CITY: STAMFORD STATE: CT ZIP: 06902 SC 13D/A 1 sc13d-a.htm sc13d-a.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
SCHEDULE 13D/A
 
Under the Securities Exchange Act of 1934
(Amendment No. 2)
 
YOU ON DEMAND HOLDINGS, INC.
(Name of Issuer)
 
Common Stock, par value $0.001 per share
(Title of Class of Securities)
 
98741R108
(CUSIP Number)
 
John D. Vaughan, Esq.
K&L Gates LLP
New York, NY 10022
(212) 536-4006
 
 (Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
 
July 5, 2013
(Date of Event which Requires Filing of this Statement)
 
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box.   o
 
The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
 
 
 
CUSIP 98741R108
 
  1.
  
Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only):
 
Shane McMahon
 
  2.
  
Check the Appropriate Box if a Member of a Group (See Instructions):
(a)  o
(b)  [X]
  3.
  
SEC Use Only 
  4.
  
Source of Funds (See Instructions): PF
  5.
   Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e): N/A
o
  6.
  
Citizenship or Place of Organization: United States
     
Number of
Shares
Beneficially
Owned by
Each
Reporting
Person
With
  7.
Sole Voting Power: 9,893,596 (1)(2)
  8.
Shared Voting Power: 2,285,714 (1)(2)
  9.
Sole Dispositive Power: 3,779,304 (1)(2)
10.
Shared Dispositive Power: 0
         
11.
  
Aggregate Amount Beneficially Owned by Each Reporting Person: 3,779,304 (1)(2)
    
12.
  
Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions):
  
o
13.
  
Percent of Class Represented by Amount in Row (11): 22.21%(3)
    
14.
  
Type of Reporting Person (See Instructions): IN
    
 
(1)
 
This amount includes (i) 2,300,000 shares of Common Stock, (ii) 411,110 shares of Common Stock underlying options exercisable within 60 days at $3.00 per share, (iii) 17,500 shares of Common Stock underlying options exercisable within 60 days at $4.50 per share; (iv) 117,360 shares of Common Stock underlying options exercisable within 60 days at $2.00 per share; and (v) 7,000,000 shares of Series A Preferred Stock.  Each share of Series A Preferred Stock is convertible, at any time at the option of the holder, into shares of Common Stock on a ten-to-one basis (and thereafter adjusted to reflect the Issuer’s February 9, 2012 1-for-75 reverse stock split).  Holders of Series A Preferred Stock vote with the holders of Common Stock on all matters and are entitled to ten (10) votes for each one (1) share of Common Stock that is issuable upon conversion of a share of Series A Preferred Stock.  Therefore since these 7,000,000 shares of Series A Preferred Stock are convertible into 933,334 shares of Common Stock, Mr. McMahon is entitled to 9,333,340 votes as result of his ownership of this Series A Preferred Stock.
   
(2)
 
The shares of equity securities of the Issuer held by Mr. McMahon are subject to the terms and conditions of the agreements described under Item 6.
   
(3)
 
Calculated based on 17,012,621 shares of Common Stock outstanding (15,533,317 shares outstanding as of July 8, 2013 plus 933,334 shares issuable upon conversion of the Series A Preferred Stock owned by Mr. McMahon and 545,970 shares issuable upon exercise of the options owned by Mr. McMahon).
 
 
 
 
This Amendment No. 2 to Schedule 13D (this “Amendment No. 2”) amends and supplements Items 3, 4, 5, 6 and 7 of that certain Amendment No. 1 to Schedule 13D (“Amendment No. 1”) filed with the Securities and Exchange Commission on November 3, 2010 (as amended, the “Schedule 13D”), which relates to the common stock (the “Common Stock”), par value $0.001 per share, of YOU On Demand Holdings, Inc., a Nevada corporation (the “Issuer”). Unless otherwise indicated, capitalized terms used but not defined in this Amendment No. 2 have the meanings ascribed to such terms in the Schedule 13D.
 
Item 3.  Source and Amount of Funds or Other Consideration.
 
Item 3 of the Schedule 13D is hereby deleted in its entirety and replaced with the following:

Mr. McMahon is the owner of 7,000,000 shares of Series A Preferred Stock of the Issuer, par value $0.001 per share (the “Series A Shares”).  As of the date of Amendment No. 1, each Series A Share was convertible into ten shares of Common Stock, subject to certain adjustments, at Mr. McMahon’s option.  The maximum aggregate number of shares of Common Stock into which the Series A Shares could have been converted as of the date of Amendment No. 1 was 70,000,000 shares.  Mr. McMahon was also the owner of 160,000,000 shares of Common Stock (the “Common Shares”).

On February 13, 2011, the Issuer completed a 1-for-75 reverse stock split of its Common Stock.  As a result of this reverse stock split, Mr. McMahon was the owner of 2,133,334 shares of Common Stock.  The 7,000,000 Series A Shares are subject to the reverse stock split upon conversion and are therefore convertible into 933,334 shares of Common Stock at any time.

On December 12, 2012, Mr. McMahon acquired an additional 166,666 shares of the Common Stock from the Issuer as part of a registered offering of Common Stock by the Issuer.

Mr. McMahon has also been granted various options by the Issuer as equity compensation.  As of the date of this Amendment No. 2, 411,110 shares of Common Stock underlying these options are exercisable within 60 days at $3.00 per share and 17,500 shares of Common Stock underlying these options exercisable within 60 days at $4.50 per share.

On July 17, 2013, Mr. McMahon purchased options to acquire 166,666 shares of Common Stock, exercisable at $2.00 per share pursuant to a private sale.  As of the date of this Amendment No. 2, the amount of such options exercisable within 60 days is 117,360.

As a result of Mr. McMahon’s ownership of the Series A Shares, the Common Shares, and options exercisable within 60 days, Mr. McMahon is the beneficial owner of 3,779,304 shares of Common Stock. 

Item 4.  Purpose of Transaction.

Item 4 of the Schedule 13D is hereby amended by inserting the following paragraphs after the first paragraph thereof:

On July 5, 2013, the Issuer entered into a Series D Preferred Stock Purchase Agreement (the “Series D Purchase Agreement”) with C Media Limited (“C Media”), the terms of which are described in the Issuer’s current report on Form 8-K filed with the SEC on July 11, 2013.  In order to induce C Media to invest $4,000,000 in shares of newly issued Series D Preferred Stock of the Issuer (the “Series D Preferred Stock”) pursuant to the terms of the Series D Purchase Agreement (the “Series D Financing”) and agree to negotiate with the Issuer in good faith and with fair dealing to enter into a Series E Purchase Agreement, a form of which is attached as an exhibit to the Series D Purchase Agreement (the “Series E Purchase Agreement”), contemplating an additional investment by C Media (the “Series E Financing”) of between $12 and 21 million of newly issued Series E Preferred Stock of the Issuer (the “Series E Preferred Stock”), Mr. McMahon and certain other holders of the Issuer’s equity securities entered into certain agreements described under Item 6 of this Amendment No. 2.  As further described in Item 6, these agreements constitute plans or proposals that relate to, or could result in, events or occurrences described in items (a) through (j) of Item 4 of Schedule 13D.

Item 4 of the Schedule 13D is hereby further amended by replacing the second paragraph thereof with the following paragraph:

Mr. McMahon, in his capacity as an investor in securities of the Issuer, has no present plans or proposals that relate to, or could result in, any of the events or occurrences described in items (a) through (j) of Item 4 of Schedule 13D, except as set forth in this Amendment No. 2, including, without limitation, those actions contemplated in the agreements discussed in Item 6.
 
 
 
Item 5.  Interest in Securities of the Issuer.

Item 5 of the Schedule 13D is hereby deleted in its entirety and replaced with the following:
 
(a) Mr. McMahon beneficially owns an aggregate of 3,779,304 shares of Common Stock, which includes (i) 2,300,000 shares of Common Stock, (ii) 411,110 shares of Common Stock underlying options exercisable within 60 days at $3.00 per share, (iii) 17,500 shares of Common Stock underlying options exercisable within 60 days at $4.50 per share; (iv) 117,360 shares of Common Stock underlying options exercisable within 60 days at $2.00 per share; and (v) 7,000,000 shares of Series A Preferred Stock which are convertible into 933,334 shares of Common Stock.

This aggregate amount represents 22.21% of the Common Stock, which is calculated based on 17,012,621 shares of Common Stock outstanding (15,533,317 shares outstanding as of July 8, 2013 plus 933,334 shares issuable upon conversion of the Series A Preferred Stock owned by Mr. McMahon and 545,970 shares issuable upon exercise of the options owned by Mr. McMahon).
 
(b)  The Series A Shares entitle Mr. McMahon to ten votes per share of Common Stock into which such Series A Shares may be converted.  As described above, each Series A Share is convertible into ten (10) shares of Common Stock at any time but thereafter subject to the Issuer’s 1 for 75 reverse stock split.  Therefore, for purposes of this statement, as a result of his ownership of the Series A Shares, Mr. McMahon may be deemed to have sole voting power with respect to an aggregate of 9,333,340 shares of Common Stock.
 
Additionally, as the holder of 2,300,000 Common Shares and options exercisable within 60 days to acquire 545,970 shares of Common Stock, Mr. McMahon may be deemed to have voting power with respect to a total of 12,163,892 shares of Common Stock.  Mr. McMahon has sole voting power over all of these shares of Common Stock except for 2,285,714 of the Common Shares, for which Mr. McMahon agreed, as further described in Item 6 below, that he will vote as directed by C Media, and therefore is deemed to have shared voting power.

Mr. McMahon is deemed to have sole dispositive power over 3,779,304 shares of Common Stock described above in paragraph (a), subject to the Voting Agreement described in Item 6 below.
 
(c) Other than as set forth herein and as disclosed in public filings referred to and incorporated by reference herein, Mr. McMahon engaged in only one other transaction involving equity securities of the Issuer, including during the past sixty (60) days:

On July 17, 2013, Mr. McMahon purchased options to acquire 166,666 shares of Common Stock of the Issuer, exercisable at $2.00 per share, for a purchase price of $2.06 per option share, pursuant to a private sale.
 
Item 6.  Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Item 6 of the Schedule 13D is hereby amended by inserting the following paragraphs after the third paragraph thereof:

In connection with the Series D Financing, Mr. McMahon has entered into an Amended and Restated Voting Agreement, dated as of July 18, 2013, with C Media (the “Voting Agreement”), a copy of which is being filed as Exhibit 99.2 hereto.  Under the terms of the Voting Agreement, Mr. McMahon has agreed that, during the term of such agreement, he will vote all voting securities of the Issuer held by him (i) in favor of the issuance and sale of the Series D Preferred Stock pursuant to the Series D Purchase Agreement, and (ii) in favor of the issuance and sale of the Series E Preferred Stock as contemplated in the Series E Purchase Agreement, including in each case any votes required under NASDAQ rules, Nevada Revised Statutes, or the Issuer’s Articles of Incorporation or Amended and Restated Bylaws, as amended.  In addition, Mr. McMahon agreed to vote all voting securities of the Issuer held by him (y) against any action, proposal, transaction or agreement which could reasonably be expected to result in a breach of any covenant, representation or warranty or any other obligation or agreement of the Issuer under either the Series D Purchase Agreement or the Series E Purchase Agreement, or of Mr. McMahon under his Voting Agreement, and (z) against any action, proposal, transaction or agreement that could, in any material respect, reasonably be expected to impede, interfere with, delay, adversely affect or inhibit the timely consummation of the issuance and sale of the Series D Preferred Stock or Series E Preferred Stock or the fulfillment of the Issuer’s or C Media’s obligations under the Series D Purchase Agreement or Series E Purchase Agreement, or change in any manner the voting rights of any class of shares of the Issuer.  Further, Mr. McMahon has agreed that if the Series E Financing occurs, he will (a) exchange his shares of Series A Preferred Stock for 933,333 Series E Preferred Stock held by C Media and then (b) convert those shares of Series E Preferred Stock into common stock of the Issuer.
 
 
 
Mr. McMahon has also agreed that he will vote 2,285,714 of his shares of common stock of the Issuer as directed by C Media until the earlier of October 31, 2013 or the closing of the Series E Financing and has granted a designee of C Media a proxy to vote those shares to effectuate that agreement.
 
Except as otherwise provided, the Voting Agreement survives until such time as the Issuer obtains shareholder approval for the issuance and sale of the Series E Preferred Stock and the NASDAQ rules regarding such approval have been satisfied; provided that if the Series E Purchase Agreement is not executed on or before October 31, 2013, the Voting Agreement will terminate upon the Issuer obtaining shareholder approval for the issuance and sale of the Series D Preferred Stock required under NASDAQ rules such that the Series D Preferred Stock will not be subject to a cap on conversion limitations.  During the term of the Voting Agreement, Mr. McMahon has agreed not to transfer, sell, offer, exchange, assign, pledge or otherwise dispose of or encumber any of the Issuer equity securities owned by him.
 
Simultaneous with consummation of the Series D Financing, Mr. McMahon also entered into a Right of First Refusal and Co-Sale Agreement, dated as of July 5, 2013, with C Media, the Issuer and Weicheng Liu (the “ROFR Co-Sale Agreement”), a copy of which is being filed as Exhibit 99.3 hereto.  Under the terms of the ROFR Co-Sale Agreement, Mr. McMahon has the right to purchase certain equity securities of the Issuer in event of a proposed transfer of such securities by another party thereto.  Except with respect to the sale of the greater of  (i) 2% of the Issuer’s outstanding equity securities and (ii) 20% of the equity securities held by Mr. McMahon as of July 5, 2013, Mr. McMahon’s ability to dispose of his Issuer equity securities, is subject to others’ rights equivalent to his rights under the ROFR Co Sale Agreements.  Mr. McMahon and C Media also have preemptive rights to acquire newly issued shares of the Issuer, subject to specified exceptions.

Exhibit G to the form of Series E Purchase Agreement attached to the Series D Purchase Agreement contains a form of Voting Agreement (“Series E Voting Agreement”), a copy of which is being filed as Exhibit 99.4 here, to be adopted if the Series E Financing is consummated.  Under the Series E Voting Agreement, Mr. McMahon and the other parties thereto have agreed to vote the Issuer equity securities held by each of them in favor of the election and maintenance of a board of directors of the Issuer comprised of two directors designated by Mr. McMahon, two directors designated by Mr. Weicheng Liu and three directors designated by C Media.

Additionally, in connection with the Series E Financing, the Issuer and C Media agreed that if the Series E Financing occurs, the promissory note in the principal amount of $3,000,000, dated May 10, 2012 (as thereafter amended), issued by the Issuer to Mr. McMahon shall, at Mr. McMahon’s option, be convertible into shares of Series E Preferred Stock of the Issuer at a conversion price of $1.75 per share or repayable upon demand by Mr. McMahon for a period of six months after the closing of the Series E Financing.

Other than as referred to above and as disclosed in documents incorporated by reference into the Schedule 13D, there are no contracts, arrangements, understandings or relationships between or involving Mr. McMahon with respect to securities of the Issuer.
 
Item 7.  Material to be Filed as Exhibits.

Item 7 of the Schedule 13D is hereby amended by the addition of the following sentence at the end thereof:

Copies of the Voting Agreement, ROFR Co-Sale Agreement and Series E Voting Agreement described under Item 6 above are attached as Exhibits 99.2, 99.3 and 99.4, respectively, hereto.
 
 
 
SIGNATURES
 
After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
 
            Date:    July 19, 2013
 
 
 SHANE MCMAHON
   
 
/s/ Shane McMahon
  
 

 EX-99.2 2 amendagrmt.htm amendagrmt.htm
 
Exhibit 99.2
 
AMENDED AND RESTATED VOTING AGREEMENT

 
This AMENDED AND RESTATED VOTING AGREEMENT (this “Agreement”), dated as of July 18, 2013 between Shane McMahon (“McMahon”), an officer of YOU On Demand Holdings, Inc., a Nevada corporation (the “Company”), and C Media Limited (“C Media”).
 
WHEREAS, the parties entered into a Voting Agreement dated as of July 5, 2013 (the “Original Agreement”);
 
WHEREAS, the parties wish to amend and restate the Original Agreement in its entirety;
 
WHEREAS, McMahon is the Chairman and CEO of the Company, and, as of the date of the Original Agreement, he owns beneficially and of record: (i) 2,300,000 shares of common stock of the Company, par value $0.001 (the “Common Stock”), (ii) 7,000,000 shares of Series A Preferred Stock of the Company, par value $0.001 (the “Series A”), and (iii) vested stock options exercisable for an aggregate of 404,721 shares of Common Stock.  The shares of Common Stock and shares of Series A currently owned by McMahon are referred to herein as the “Original Shares” and, together with any additional shares of voting capital stock in the Company acquired after the date hereof, the “Shares;”
 
WHEREAS, the Series A vote together with the Common Stock on an as-converted basis and McMahon currently holds 46.5% of the outstanding voting power of the Company;
 
WHEREAS, concurrently with or following the execution of this Agreement, the Company and C Media, have entered, or will enter, into a Series D Preferred Stock Purchase Agreement (as the same may be amended from time to time, the “Series D Purchase Agreement”), providing for, among other things, the issuance and sale of 2,285,714 shares of the Series D 4% Convertible Preferred Stock of the Company, par value $0.001 (the “Series D”) pursuant to the terms and conditions of the Series D Purchase Agreement;
 
WHEREAS, as part of the Series D Purchase Agreement, the Company and C Media, have agreed to negotiate in good faith a Series E Preferred Stock Purchase Agreement (the “Series E Purchase Agreement” and together with the Series D Purchase Agreement, the “Purchase Agreements”), providing for, among other things, the issuance and sale of shares of Series E Convertible Preferred Stock of the Company, par value $0.001 (the “Series E”) with an aggregate purchase price of $12 million to $21 million pursuant to the terms and conditions of the Series E Purchase Agreement;
 
WHEREAS, as a condition to its willingness to enter into the Series D Purchase Agreement, C Media has required that McMahon execute and deliver this Agreement; and
 
WHEREAS, in order to induce C Media to enter into the Series D Purchase Agreement, McMahon is willing to make certain representations, warranties, covenants and agreements with respect to the Original Shares and the Shares.
 
 
 
 
NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby acknowledged, the parties hereto agree as follows:
 
1.           Definitions.
 
For purposes of this Agreement, capitalized terms used and not defined herein shall have the respective meanings ascribed to them in the Series D Purchase Agreement.
 
2.           Representations of McMahon.
 
McMahon represents and warrants to C Media that:
 
(a)           (i) McMahon owns beneficially (as such term is defined in Rule 13d-3 under the Exchange Act) all of the Original Shares free and clear of all Liens, and (ii) except pursuant hereto or pursuant to that certain Right of First Refusal and Co-Sale Agreement dated on or about the date hereof, there are no options, warrants or other rights, agreements, arrangements or commitments of any character to which McMahon is a party relating to the pledge, disposition or voting of any of the Original Shares and there are no voting trusts or voting agreements with respect to the Original Shares.
 
(b)           McMahon does not beneficially own any voting shares of Company Common Stock other than (i) the Common Stock in the Original Shares, (ii) the Series A in the Original Shares, and (iii) any options, warrants or other rights to acquire any additional shares of Company Common Stock or any security exercisable for or convertible into shares of Company Common Stock, set forth on the signature page of this Agreement (collectively, “Options”).
 
(c)           McMahon has the legal capacity to enter into, execute and deliver this Agreement and to perform fully McMahon’s obligations hereunder (including the proxy described in Section 3(d) below)). This Agreement has been duly and validly executed and delivered by McMahon and constitutes the legal, valid and binding obligation of McMahon, enforceable against McMahon in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability, and equitable principles.
 
(d)           None of the execution and delivery of this Agreement by McMahon, the consummation by McMahon of the transactions contemplated hereby or compliance by McMahon with any of the provisions hereof will conflict with or result in a breach, or constitute a default (with or without notice of lapse of time or both) under any provision of, any trust agreement, loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument or Requirement of Law applicable to McMahon or to McMahon’s property or assets.
 
(e)           No consent, approval or authorization of, or designation, declaration or filing with, any Governmental Authority or other Person on the part of McMahon is required in connection with the valid execution and delivery of this Agreement.  No consent of McMahon’s spouse is necessary under any “community property” or other laws in order for McMahon to enter into and perform its obligations under this Agreement.
 
 
 
 
3.           Agreement to Vote Shares; Irrevocable Proxy.
 
(a)           McMahon agrees during the term of this Agreement to vote the Shares, and to cause any holder of record of Shares to vote at every meeting of the stockholders of the Company at which such matters are considered and at every adjournment or postponement thereof, or to execute a written consent or consents in lieu of any such meeting of stockholders of the Company: (i) in favor of the issuance and sale of the Series D as contemplated in the Series D Purchase Agreement, and (ii) in favor of the issuance and sale of the Series E as contemplated in the Series E Purchase Agreement, including in each case any votes required under NASDAQ rules, Nevada Revised Statutes, or the Company’s Articles of Incorporation or Amended and Restated Bylaws, as amended.
 
(b)           McMahon agrees during the term of this Agreement to vote the Shares, and to cause any holder of record of Shares to vote at every meeting of the stockholders of the Company at which such matters are considered and at every adjournment or postponement thereof, or to execute a written consent or consents in lieu of any such meeting of stockholders of the Company: (i) against any action, proposal, transaction or agreement which could reasonably be expected to result in a breach of any covenant, representation or warranty or any other obligation or agreement of the Company under the Purchase Agreements or of McMahon under this Agreement and (ii) against any action, proposal, transaction or agreement that could, in any material respect, reasonably be expected to impede, interfere with, delay, adversely affect or inhibit the timely consummation of the issuance and sale of the Series D or Series E or the fulfillment of C Media’s or the Company’s obligations under the Purchase Agreements, or change in any manner the voting rights of any class of shares of the Company.
 
(c)           Until the earlier of (i) the closing of the Series E Purchase Agreement, or (ii) October 31, 2013, McMahon agrees to vote 2,285,714 of his shares of Common Stock (the “Interim Shares”) as directed by C Media.
 
(d)           McMahon hereby appoints Xuesong Song and any designee of C Media, and each of them individually, its proxies and attorneys-in-fact, with full power of substitution and resubstitution, to vote or act by written consent during the term of this Agreement with respect to the Shares in accordance with Sections 3(a) and 3(b) and the Interim Shares pursuant to Section 3(c). This proxy and power of attorney is given to secure the performance of the duties of McMahon under this Agreement. McMahon shall take such further action or execute such other instruments as may be necessary to effectuate the intent of this proxy. This proxy and power of attorney granted by McMahon shall be irrevocable during the term of this Agreement, shall be deemed to be coupled with an interest sufficient in law to support an irrevocable proxy and shall revoke any and all prior proxies granted by McMahon with respect to the Shares. The power of attorney granted by McMahon herein is a durable power of attorney and shall survive the dissolution, bankruptcy, death or incapacity of McMahon. The proxy and power of attorney granted hereunder shall terminate upon the termination of this Agreement.
 
4.           No Voting Trusts or Other Arrangement.
 
McMahon agrees that during the term of this Agreement he will not, and will not permit any entity under McMahon’s control to, deposit any of the Shares in a voting trust, grant any
 
 
 
 
proxies with respect to the Shares or subject any of the Shares to any arrangement with respect to the voting of the Shares other than agreements entered into with C Media.
 
5.           [Intentionally Deleted].
 
6.           Exchange and Conversion of Shares.
 
At the Series E Closing, McMahon agrees to (a) exchange all of his shares of Series A Preferred Stock for 933,333 shares of Series E Preferred Stock held by C Media or its transferee and (b) convert all such shares of his Series E Preferred Stock into Common Stock.
 
7.           Transfer and Encumbrance.
 
McMahon agrees that during the term of this Agreement, McMahon will not, directly or indirectly, transfer, sell, offer, exchange, assign, pledge or otherwise dispose of or encumber (“Transfer”) any of the Shares or enter into any contract, option or other agreement with respect to, or consent to, a Transfer of, any of the Shares or McMahon’s voting or economic interest therein; provided that, the foregoing restriction shall not apply to the any Transfer contemplated by the Series E Purchase Agreement or this Agreement.  Any attempted Transfer of Shares or any interest therein in violation of this Section 7 shall be null and void. This Section 7 shall not prohibit a Transfer of the Shares upon the death of McMahon; provided, that the executor of the estate of McMahon or other transferee agrees in a writing, reasonably satisfactory in form and substance to C Media, to be bound by all of the terms of this Agreement.
 
8.           Additional Shares.
 
McMahon agrees that all shares of Company voting capital stock that McMahon purchases, acquires the right to vote or otherwise acquires beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) of after the execution of this Agreement shall be subject to the terms of this Agreement and shall constitute Shares for all purposes of this Agreement.
 
9.           Shareholders’ Release.
 
McMahon hereby waives, and agrees not to assert or perfect, any rights of appraisal or rights to dissent from transactions contemplated by the Purchase Agreements and that McMahon may have by virtue of ownership of the Shares.
 
10.           Termination.
 
This Agreement shall survive until: (a) if the Series E Purchase Agreement is executed before October 31, 2013, (i) when the Company obtains shareholder approval for the issuance and sale of the Series E Preferred Stock and the NASDAQ rules regarding such approval have been satisfied and (ii) the condition described in Section 6 is satisfied or (b) if the Series E Purchase Agreement is not executed before October 31, 2013, when the Company obtains shareholder approval for the issuance and sale of the Series D Preferred Stock required under NASDAQ rules such that the Series D will not be subject to a cap on conversion limitations.  Notwithstanding the foregoing, when specified, covenants hereunder shall survive or terminate in accordance with their terms.
 
 
 
 
11.           No Agreement as Director or Officer.
 
McMahon makes no agreement or understanding in this Agreement in McMahon’s capacity as a director or officer of the Company or any of its subsidiaries (if McMahon holds such office), and nothing in this Agreement: (a) will limit or affect any actions or omissions taken by McMahon in his capacity as a director or officer, and no such actions or omissions shall be deemed a breach of this Agreement or (b) will be construed to prohibit, limit or restrict McMahon from exercising McMahon’s fiduciary duties as an officer or director to the Company or any of its subsidiaries or their respective stockholders.
 
12.           Specific Performance.
 
Each party hereto acknowledges that it will be impossible to measure in money the damage to the other party if a party hereto fails to comply with any of the obligations imposed by this Agreement, that every such obligation is material and that, in the event of any such failure, the other party will not have an adequate remedy at law or damages. Accordingly, each party hereto agrees that injunctive relief or other equitable remedy, in addition to remedies at law or damages, is the appropriate remedy for any such failure and will not oppose the seeking of such relief on the basis that the other party has an adequate remedy at law. Each party hereto agrees that it will not seek, and agrees to waive any requirement for, the securing or posting of a bond in connection with the other party’s seeking or obtaining such equitable relief.
 
13.           Entire Agreement.
 
This Agreement, together with the Purchase Agreements, and the Company Agreements are intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein and therein.  There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein or therein.  This Agreement, together with the Purchase Agreements and the Company Agreements, supersede all prior agreements and understandings between the parties with respect to such subject matter.
 
14.           Notices.
 
All notices or other communications required or permitted hereunder shall be in writing and shall be delivered personally, telecopied or sent by certified, registered or express mail, postage prepaid.  Any such notice shall be deemed given if delivered personally or telecopied, on the date of such delivery, or if sent by reputable overnight courier, on the first Business Day following the date of such mailing, as follows:
 
 
 
 
(i)           if to McMahon:
 
Mr. Shane McMahon
 
YOU On Demand Holdings, Inc.
27 Union Square West, Suite 502
New York, New York 10003
Facsimile: (212) 206-9112
 
with a copy to:
 
Pillsbury Winthrop Shaw Pittman LLP
2300 N Street
Washington DC  20037
Attention: Louis Bevilacqua
Facsimile: (212) 663-8007
 
and
 
K&L Gates LLP
599 Lexington Avenue
New York, NY 10022
Attention: Jack Vaughan
Facsimile: (212) 536-3901

(ii)           if to C Media:
 
C Media Limited
CN11 Legend Town,
No. 1 Balizhuangdongli, Chaoyang District
Beijing, China 100025
Attn: Victor Chen, Vice President
Rainer Li, CFO
Telecopy: 86 10 8586 2775

with a copy to:
 
Reed Smith LLP
599 Lexington Ave.
New York, New York 10022
Attn: William N. Haddad
Facsimile: (212) 521-5400
 
Any party may by notice given in accordance with this Section designate another address or Person for receipt of notices hereunder.
 
15.           Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by and construed in accordance with the Requirements of Law of the State of
 
 
 
 
New York without giving effect to the principles of conflict of laws.  Each of the parties hereto hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the courts of the State of New York and of the United States of America, in each case located in the County of New York, for any Action arising out of or relating to this Agreement and the Contemplated Transactions (and agrees not to commence any Action relating thereto except in such courts), and further agrees that service of any process, summons, notice or document by U.S. registered mail to its respective address set forth in this Agreement, or such other address as may be given by one or more parties to the other parties in accordance with the notice provisions of Section 14, shall be effective service of process for any action, suit or proceeding brought against it in any such court.  Each of the parties hereto hereby irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement or the transactions contemplated hereby in the courts of the State of New York or the United States of America, in each case located in the County of New York, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such Action brought in any such court has been brought in an inconvenient forum. Each of the parties irrevocably and unconditionally waives, to the fullest extent permitted by applicable Requirements of Law, any and all rights to trial by jury in connection with any action, suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.
 
16.           Severability.  If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired, unless the provisions held invalid, illegal or unenforceable shall substantially impair the benefits of the remaining provisions hereof.
 
17.           Counterparts.  This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, all of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.
 
18.           Further Assurances.  Each party hereto shall execute and deliver such additional documents as may be necessary or desirable to effect the transactions contemplated by this Agreement.
 
19.           Headings.  The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.
 
20.           Assignment.  No party hereto may assign its rights under this Agreement without the prior written consent of the other party hereto; provided, however, that, without the prior written consent of McMahon, C Media may assign all or any portion of its rights hereunder (along with the corresponding obligations) to any affiliate.  Any assignee of C Media pursuant to the proviso of the foregoing sentence shall be deemed to be “C Media” for all purposes of this Agreement.
 
[SIGNATURE PAGES FOLLOW]
 
 
 
 
IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the date first written above.
 
 
C MEDIA LIMITED
 
 
By:    /s/ Xuesong Song      
Name: Xuesong Song
Title:   Chairman and CEO






 
[Signature Page to Amended and Restated Voting Agreement]
 
 

 
MCMAHON
 
 
By   /s/ Shane McMahon      
     Shane McMahon
 
Number of Options Beneficially Owned as of the Date of this Agreement:  545,970
Street Address:
C/O YOU On Demand Holdings, Inc.
27 Union Square West, Suite 502
City/State/Zip Code:  New York, NY 10003
Fax:  212-206-9112







[Signature Page to Amended and Restated Voting Agreement]




 
 EX-99.3 3 cosaleagrmt.htm cosaleagrmt.htm
Exhibit 99.3
 
RIGHT OF FIRST REFUSAL AND CO-SALE AGREEMENT
 
This RIGHT OF FIRST REFUSAL AND CO-SALE AGREEMENT (this “Agreement”) is entered into as of the 5th day of July, 2013 by and among YOU On Demand Holdings, Inc., a Nevada corporation (the “Company”), the stockholders of the Company set forth on the signature page hereto (each a “Key Holder” and collectively the “Key Holders”), and C Media Limited as the holder of the Company’s Series D Preferred Stock (the “Investor”, and together with the Key Holders, the “Major Stockholders”).
 
W I T N E S S E T H :
 
WHEREAS, the Company and the Investor are parties to the Series D Preferred Stock Purchase Agreement of even date herewith (the “Series D Purchase Agreement”), pursuant to which the Investor is purchasing shares of the Company’s Series D Preferred Stock;
 
WHEREAS, as part of the Series D Purchase Agreement, the Company and Investor, have agreed to negotiate in good faith a Series E Preferred Stock Purchase Agreement (the “Series E Purchase Agreement” and together with the Series D Purchase Agreement, the “Purchase Agreements”), providing for, among other things, the issuance and sale of shares of the Series E Convertible Preferred Stock of the Company, par value $0.001 (the “Series E”) per share, pursuant to the terms and conditions of the Series E Purchase Agreement; and
 
WHEREAS, the Series D Purchase Agreement provides that, as a condition to the closing of the sale of the Series D Preferred Stock, this Agreement must be executed and delivered by the Investor, the Key Holders, and the Company.
 
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties hereto agree as follows:
 
THE PARTIES AGREE AS FOLLOWS:
 
1.           Restrictions on Transfer of Shares by Major Stockholders. Except as otherwise provided in the Purchase Agreements or this Agreement, each Major Stockholder will not sell, assign, transfer, pledge, hypothecate or otherwise encumber or dispose of in any way all or any part of or any interest in the Equity Securities (as defined below) now or hereafter owned or held by the Major Stockholder. Any sale, assignment, transfer, pledge, hypothecation or other encumbrance or disposition of Equity Securities not made in conformance with this Agreement shall be null and void, shall not be recorded on the books of the Company and shall not be recognized by the Company.
 
2.           Definitions.
 
(a)           Co-Sale Pro Rata Share.  For purposes of this Agreement, the term “Co-Sale Pro Rata Share” means the fraction obtained by dividing (i) the number of shares of the Company’s Common Stock constituting or underlying all Equity Securities then held by the Major Stockholder by (ii) the sum of the total number of shares of the Company’s Common Stock constituting or underlying all Equity Securities.
 
 
 
 
(b)           Employment Agreement. For purposes of this Agreement, the term “Employment Agreement” shall mean that certain Employment Agreement to be entered between the Company and Shane McMahon upon the closing of the issuance and sale of the Series E Purchase Agreement in the form attached to the Series E Purchase Agreement.
 
(c)           Equity Securities. For purposes of this Agreement, the term “Equity Securities” shall mean any securities having voting rights in the election of the Board of Directors of the Company not contingent upon default, any securities evidencing an ownership interest in the Company, any securities convertible into or exercisable for any shares of the foregoing or any agreement or commitment to issue any of the foregoing.
 
(d)           Exempt Issuance. For the purposes of this Agreement, the term “Exempt Issuance” means the issuance of (i) shares of Common Stock or options to employees, officers, directors, consultants or advisors of the Company pursuant to any stock or option plan or agreement duly adopted by a majority of the non-employee members of the Board of Directors of the Company or a majority of the members of a committee of non-employee directors established for such purpose, (ii) securities upon the exercise or exchange of or conversion of any securities issued pursuant to the Purchase Agreements and/or other securities exercisable or exchangeable for or convertible into shares of Common Stock issued and outstanding on the date of the Series D Purchase Agreement, provided that such securities have not been amended since the date of the Series D Purchase Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of any such securities (for the avoidance of doubt, the issuance of any securities which may be issuable to Weicheng Liu pursuant to that certain Ordinary Share Purchase Agreement, dated August 30, 2010, shall be deemed to be Exempt Issuances pursuant to this subsection (ii)), (iii) securities issued upon the declaration of a dividend on any Equity Securities, (iv) securities issued in connection with technology licenses, development, marketing or other similar agreements or strategic partnerships approved by the Board of Directors of the Company, but not to the extent such transactions constitute capital raising transactions, (v) securities issued to consultants of the Company in the ordinary course of business, (vi) securities issued in connection with a merger, consolidation or similar transaction between the Company and C Media Limited, Chum Capital Group Limited, any Affiliate of C Media Limited or Chum Capital Group Limited, or any assignee of right under the Purchase Agreements of C Media Limited or Chum Capital Group Limited and (g) securities issued to officers of the Company in lieu of cash payments for salary or any other compensation, but not to the extent such transactions constitute capital raising transactions.
 
(e)           Qualified Public Offering.  For purposes of this Agreement, the term “Qualified Public Offering” means an underwritten public offering conducted by the Company in which it raises gross proceeds of at least $20 million.
 
3.           Agreements Among the Company, the Investor and the Key Holders.
 
3.1           Rights of Refusal.
 
(a)           Transfer Notice. If at any time any Key Holder or the Investor (a “Transferring Stockholder”) proposes to transfer Equity Securities to one or more bona fide third
 
 
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parties pursuant to an understanding with such third parties (a “Transfer”), then the Transferring Stockholder shall give the Company and the other Major Stockholders (the “Remaining Major Stockholders”) written notice of the Transferring Stockholder’s intention to make the Transfer (the “Transfer Notice”), which Transfer Notice shall include (i) a description of the Equity Securities to be transferred (“Offered Shares”), (ii) the identity of the prospective transferee(s) and (iii) the consideration and the material terms and conditions upon which the proposed Transfer is to be made. The Transfer Notice shall certify that the Transferring Stockholder in good faith believes a binding agreement for the Transfer is obtainable on the terms set forth in the Transfer Notice. The Transfer Notice shall also include a copy of any written proposal, term sheet or letter of intent or other agreement relating to the proposed Transfer.
 
(b)           Company’s Option. The Company shall have an option for a period of ten (10) days from receipt of the Transfer Notice to elect to purchase the Offered Shares at the same price and subject to the same material terms and conditions as described in the Transfer Notice. The Company may exercise such purchase option and, thereby, purchase all of the Offered Shares by notifying the Transferring Stockholder in writing before expiration of the such ten (10) day period.  If the Company gives the Transferring Stockholder notice that it desires to purchase such shares, then payment for the Offered Shares shall be by check or wire transfer, against delivery of the Offered Shares to be purchased at a place agreed upon between the parties and at the time of the scheduled closing therefor, which shall be no later than forty-five (45) days after the Company’s receipt of the Transfer Notice, unless the Transfer Notice contemplated a later closing with the prospective third party transferee(s) or unless the value of the purchase price has not yet been established pursuant to Section 3.1(e). If the Company fails to purchase all of the Offered Shares by exercising the option granted in this Section 3.1(b) within the period provided, the Offered Shares shall be subject to the options granted to the Remaining Major Stockholders pursuant to this Agreement.
 
(c)           Additional Transfer Notice. If the Company has declined to purchase all of the Offered Shares pursuant to Section 3.1(b), the Transferring Stockholder shall, within five (5) days of the Company’s decline, give the Remaining Major Stockholders an “Additional Transfer Notice” which shall include all of the information and certifications required in a Transfer Notice and reference the Remaining Major Stockholders’ rights of first refusal and co-sale with respect to the proposed Transfer pursuant to this Agreement.
 
(d)           Remaining Major Stockholders’ Option. The Remaining Major Stockholders shall have an option for a period of twenty (20) days from the day on which it received the Additional Transfer Notice from the Transferring Stockholder set forth in Section 3.1(c) to elect to purchase all of the Offered Shares at the same price and subject to the same material terms and conditions as described in the Additional Transfer Notice. The Remaining Major Stockholders may exercise such purchase option and, thereby, purchase all of the Offered Shares (in such proportions as they may mutually agree, or in the absence of such agreement, in an amount equal to the number of Offered Shares multiplied by a fraction in which the numerator is the number of shares of Equity Securities owned by such Remaining Major Stockholder and the denominator of which is the number of shares of Equity Securities owned by all Remaining Major Stockholder exercising the purchase option), by notifying the Transferring Stockholder and the Company in writing, before expiration of the twenty (20) day period. Any Major Stockholder exercising its purchase option shall be entitled to apportion Offered Shares to be
 
 
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purchased among its partners and affiliates, provided that it notifies the Transferring Stockholder of such allocation. If one or more of the Remaining Major Stockholders gives the Transferring Stockholder notice that it (or they) desires to purchase all of the Offered Shares, then payment for the Offered Shares shall be by check or wire transfer, against delivery of the Offered Shares to be purchased at a place agreed upon between the parties and at the time of the scheduled closing therefor, which shall be no later than forty-five (45) days after the Company’s receipt of the Transfer Notice, unless the Transfer Notice contemplated a later closing with the prospective third party transferee(s) or unless the value of the purchase price has not yet been established pursuant to Section 3.1(e).
 
(e)           Forfeiture of Rights.  Notwithstanding the foregoing, if the total number of Offered Shares that the Remaining Major Stockholders have agreed to purchase is less than the total number of Offered Shares, then the Remaining Major Stockholders shall be deemed to have forfeited any right to purchase such Offered Shares, and the Transferring Stockholder shall be free to sell all, but not less than all, of the Offered Shares to a bona fide third party on terms and conditions substantially similar to (and in no event more favorable than) the terms and conditions set forth in the Transfer Notice, it being understood and agreed that (i) any such sale or transfer shall be subject to the other terms and restrictions of this Agreement, including without limitation the terms set forth in Section 3.2; (ii) any future Transfer shall remain subject to the terms and conditions of this Agreement including this Section 3; and (iii) such sale shall be consummated within forty-five (45) days after receipt of the Transfer Notice by the Company and, if such sale is not consummated within such forty-five (45) day period, such sale shall become subject to the Right of First Refusal on the terms set forth herein.
 
(f)           Valuation of Property. Should the purchase price specified in the Transfer Notice or Additional Transfer Notice be payable in property other than cash or evidences of indebtedness, the Company or the Remaining Major Stockholders, as applicable, shall have the right to pay the purchase price in the form of cash equal in amount to the value of such property. If the Transferring Stockholder and the Company or the Remaining Major Stockholders, as applicable, cannot agree on such cash value within ten (10) days after the Company’s receipt of the Transfer Notice or the Remaining Major Stockholders’ receipt of the Additional Transfer Notice, the valuation shall be made by an appraiser of recognized standing selected by the Transferring Stockholder and the Company or the Remaining Major Stockholders, as applicable, or, if they cannot agree on an appraiser within twenty (20) days after the Company’s receipt of the Transfer Notice or the Remaining Major Stockholders’ receipt of the Additional Transfer Notice, each shall select an appraiser of recognized standing and the two appraisers shall designate a third appraiser of recognized standing, whose appraisal shall be determinative of such value. The cost of such appraisal shall be shared equally by the Transferring Stockholder and the Company or the Remaining Major Stockholders exercising their purchase rights, as applicable. If the time for the closing of the Company’s purchase or the Remaining Major Stockholders’ purchase has expired but for the determination of the value of the purchase price offered by the prospective transferee(s), then such closing shall be held on or prior to the fifth business day after such valuation shall have been made pursuant to this subsection.
 
 
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3.2           Right of Co-Sale.
 
(a)           To the extent the Company and the Remaining Major Stockholders do not exercise their respective rights of refusal as to all of the Offered Shares pursuant to Section 3.1, then the Remaining Major Stockholders may notify the Transferring Stockholder in writing within twenty (20) days after receipt of the Transfer Notice referred to in Section 3.1(a), and shall have the right to participate in such sale of Equity Securities on the same terms and conditions as specified in the Transfer Notice (such participating Major Stockholders referred to as “Co-Sale Stockholders”). Such notice to the Transferring Stockholder shall indicate the number of shares of Equity Securities the Co-Sale Stockholders wish to sell under their rights to participate.
 
(b)           The Co-Sale Stockholders may sell up to that number of shares of Equity Securities (including shares of Common Stock issuable upon conversion of Series A Preferred Stock, Series D Preferred Stock, any other convertible securities hereafter issued) owned by the Co-Sale Stockholders on the date of the Transfer Notice equal to the product of (i) the aggregate number of shares of Equity Securities covered by the Transfer Notice, times (ii) the Co-Sale Stockholders’Co-Sale Pro Rata Share.
 
(c)           The Co-Sale Stockholders shall effect their respective participations in the sale by promptly delivering to the Transferring Stockholder for transfer to the prospective purchaser one or more certificates, properly endorsed for transfer, which represent:
 
(i)           the type and number of shares of Equity Securities which such Co-Sale Stockholder elects to sell; or
 
(ii)           that number of shares of Equities Securities which are at such time convertible into the number of shares of Common Stock which such Co-Sale Stockholder elects to sell; provided, however, that if the prospective third-party purchaser objects to the delivery of Equity Securities in lieu of Common Stock, the Co-Sale Stockholder shall, to the extent feasible, convert such Equity Securities into Common Stock and deliver Common Stock as provided in this Section 3.2. The Company agrees to make any such conversion concurrent with the actual transfer of such shares to the purchaser and contingent on such transfer.
 
(d)           The stock certificate or certificates that the Co-Sale Stockholders delivers to the Transferring Stockholder pursuant to Section 3.2(c) shall be transferred to the prospective purchaser in consummation of the sale of the Equity Securities pursuant to the terms and conditions specified in the Transfer Notice, and the Transferring Stockholder shall concurrently therewith remit to the Co-Sale Stockholders that portion of the sale proceeds to which they are entitled by reason of their participation in such sale. To the extent that any prospective purchaser or purchasers prohibits such assignment or otherwise refuses to purchase shares or other securities from the Co-Sale Stockholders exercising their rights of co-sale hereunder (e.g., by refusing to accept Common Stock in lieu of another Equity Security), the Transferring Stockholder shall not sell to such prospective purchaser or purchasers any Equity Securities unless and until, simultaneously with such sale, the Transferring Stockholder shall purchase such shares or other securities from such Co-Sale Stockholders for the same
 
 
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consideration (on an as-converted basis, if applicable) and on the same terms and conditions as the proposed transfer described in the Transfer Notice.
 
(e)           The Investor shall not be required in connection with any such transaction to make any representation, warranty or covenant other than a representation as to its power and authority to effect such transfer and as to its title to the securities to be transferred by it.
 
(f)           This Section 3.2 shall terminate upon the earliest of (i) the Company’s termination of Shane McMahon without Cause (as defined in the Employment Agreement), (ii) Shane’s voluntary termination for Good Reason (as defined in the Employment Agreement), or (iii) the date the Company gives notice it will not renew the term of the Employment Agreement.
 
3.3           Non-Exercise of Rights. To the extent that the Company and the Remaining Major Stockholders have not exercised their rights to purchase the Offered Shares within the time periods specified in Section 3.1 and the Co-Sale Stockholders have not exercised their rights to participate in the sale of the Offered Shares within the time periods specified in Section 3.2, the Transferring Stockholder shall have a period of ninety (90) days from the expiration of such rights in which to sell the Offered Shares, as the case may be, upon terms and conditions (including the purchase price) no more favorable than those specified in the Transfer Notice to the third-party transferee(s) identified in the Transfer Notice. The third-party transferee(s) shall acquire the Offered Shares free and clear of subsequent rights of first refusal and co-sale rights under this Agreement. In the event the Transferring Stockholder does not consummate the sale or disposition of the Offered Shares within the ninety (90) day period from the expiration of these rights, the Company’s first refusal rights and the Remaining Major Stockholders’ first refusal rights and co-sale rights shall continue to be applicable to any subsequent disposition of the Offered Shares by the Transferring Stockholder until such right lapses in accordance with the terms of this Agreement. Furthermore, the exercise or non-exercise of the rights of the Company and the Major Stockholders under this Section 3 to purchase Equity Securities from the Transferring Stockholder or participate in sales of Equity Securities by the Transferring Stockholder shall not adversely affect their rights to make subsequent purchases from any Transferring Stockholder of Equity Securities or subsequently participate in sales of Equity Securities by any Transferring Stockholder.
 
3.4           Limitations to Rights of Refusal and Co-Sale. Notwithstanding the provisions of Sections 3.1 and 3.2 of this Agreement, any Major Stockholder may (i) sell, in one or more open-market transactions or private sales, shares in an amount up to the greater of (x) two  percent (2%) of the Company’s outstanding Equity Securities and (y) twenty percent (20%) of the shares of the Company’s Equity Securities held by such Major Stockholder, as of the date of this Agreement, without triggering the provisions of Sections 3.1 and 3.2, and (ii) sell or otherwise assign, with or without consideration, Equity Securities to any spouse or member of such Major Stockholder’s immediate family, to a custodian, trustee (including a trustee of a voting trust), executor or other fiduciary for the account of such Major Stockholder’s spouse or members of such Major Stockholder’s immediate family, to a trust for such Major Stockholder’s own self, to a charitable remainder trust or to a partner or affiliate of such Major Stockholder, provided that each such transferee or assignee, prior to the completion of the sale, transfer or
 
 
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assignment shall have executed documents assuming the obligations of the Major Stockholder under this Agreement with respect to the transferred securities.
 
3.5           Prohibited Transfers.
 
(a)           In the event any Transferring Stockholder should sell any Equity Securities in contravention of the co-sale rights under Section 3.2 (a “Prohibited Transfer”), the Remaining Major Stockholders, in addition to such other remedies as may be available at law, in equity or hereunder, shall have the put option provided below, and such Transferring Stockholder shall be bound by the applicable provisions of such option.
 
(b)           Notwithstanding the foregoing, any attempt by any Major Stockholder to transfer Equity Securities in violation of Section 3 hereof shall be void and the Company agrees it will not effect such a transfer nor will it treat any alleged transferee(s) as the holder of such shares without the written consent of the Remaining Major Stockholders.
 
(c)           In the event that the Company fails to comply with Section 3.5(b) hereof, and as such a Prohibited Transfer is consummated, the Remaining Major Stockholders shall have the right to sell to the Transferring Stockholder the type and number of shares of Equity Securities equal to the number of shares the Remaining Major Stockholders would have been entitled to transfer to the third-party transferee(s) under Section 3.2 hereof had the Prohibited Transfer been effected pursuant to and in compliance with the terms hereof. Such sale shall be made on the following terms and conditions:
 
(i)           The price per share at which the shares are to be sold to the Transferring Stockholder shall be equal to the price per share paid by the third-party transferee(s) to the Transferring Stockholder in the Prohibited Transfer (on an as-converted basis, if applicable). The Transferring Stockholder shall also reimburse the Remaining Major Stockholders for any and all fees and expenses, including legal fees and expenses, incurred pursuant to the exercise or the attempted exercise of the Remaining Major Stockholders’ rights under Section 3.
 
(ii)           Within ninety (90) days after the later of the dates on which the Remaining Major Stockholders (A) received notice of the Prohibited Transfer or (B) otherwise become aware of the Prohibited Transfer, the Remaining Major Stockholders shall, if exercising the option created hereby, deliver to the Transferring Stockholder the certificate or certificates representing shares to be sold, each certificate to be properly endorsed for transfer.
 
(iii)           The Transferring Stockholder shall, upon receipt of the certificate or certificates for the shares to be sold by the Remaining Major Stockholders, pursuant to this Section 3.5, pay the aggregate purchase price therefor and the amount of reimbursable fees and expenses, as specified in subparagraph 3.5(b), in cash, certified check or by wire transfer of immediately available funds to an account designated by the Remaining Major Stockholders.
 
4.           Preemptive Rights. Except for Exempt Issuances, if the Company proposes to issue any Equity Securities, the Company shall give notice of such intent, which notice shall specify the price, amount and rights of the Equity Securities and other terms of the proposed
 
 
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issuance (the “Preemptive Rights Offering Notice”) to the Investor and Shane McMahon (“McMahon”).  Each of the Investor and McMahon shall have the right to purchase, upon the same terms as specified in the Preemptive Rights Offering Notice, that number of additional Equity Securities proposed to be to be issued by the Company equal to the product of (a) the number of Equity Securities the Company proposes to issue and (b) a fraction, the numerator of which is the number of Equity Securities held by the Investor or McMahon (as the case may be), on a fully diluted basis, immediately prior to the issuance, and the denominator of which is the total number of Equity Securities outstanding, immediately prior to the issuance, on a fully diluted basis.  Each of the Investor and McMahon that wishes to exercise rights under this Section 4 shall give irrevocable notice to the Company of such decision within ten (10) days after the giving of the Preemptive Rights Offering Notice.  In the event either exercises its/his rights, the closing of such sale to the Investor and/or McMahon shall be within sixty (60) days after the expiration of the ten (10) day period.  If either the Investor or McMahon do not exercise their rights under this Section 4, the Company shall have ninety (90) days after the expiration of the ten (10) day period to consummate a sale with another investor, upon terms, including price, no more favorable to the prospective investor than those specified in the Preemptive Rights Offering Notice.
 
5.           Assignments and Transfers; No Third Party Beneficiaries. This Agreement and the rights and obligations of the parties hereunder shall inure to the benefit of, and be binding upon, their respective successors, assigns and legal representatives, but shall not otherwise be for the benefit of any third party. The rights of a Major Stockholder hereunder are only assignable to a spouse or member of such Major Stockholder’s immediate family, to a custodian, trustee (including a trustee of a voting trust), executor or other fiduciary for the account of such Major Stockholder’s spouse or members of such Major Stockholder’s immediate family, to a trust for such Major Stockholder’s own self, to a charitable remainder trust or to a partner or affiliate of such Major Stockholder who acquires all of the Equity Securities owned by such Major Stockholder in a single transaction or series of related transactions.  Notwithstanding the foregoing, Investor may assign its rights hereunder to an affiliate.
 
6.           Legend. Each existing or replacement certificate for shares now owned or hereafter acquired by the Major Stockholder shall bear the following legend upon its face:
 
“THE SALE, PLEDGE, HYPOTHECATION, ASSIGNMENT OR TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN RIGHT OF FIRST REFUSAL AND CO-SALE AGREEMENT BY AND BETWEEN THE STOCKHOLDER, THE CORPORATION AND CERTAIN HOLDERS OF STOCK OF THE CORPORATION. COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF THE CORPORATION.”
 
7.           Effect of Change in Company’s Capital Structure. Appropriate adjustments shall be made in the number and class of shares in the event of a stock dividend, stock split, reverse stock split, combination, reclassification or like change in the capital structure of the Company.
 
 
- 8 -
 
8.           Notices. All notices or other communications required or permitted hereunder shall be in writing and shall be delivered personally, telecopied or sent by certified, registered or express mail, postage prepaid, addressed (i) in the case of the Key Holder or Investor to the address as set forth in the Company’s records or such other address as the Key Holder or Investor may designate in writing from time to time, (ii) in the case of the Company, to its principal office, and (iii) in the case of any permitted transferee of a party to this Agreement or its transferee, to such transferee at its address as designated in writing by such transferee to the Company from time to time. Any such notice shall be deemed given if delivered personally or telecopied, on the date of such delivery, or if sent by reputable overnight courier, on the first Business Day following the date of such mailing.
 
9.           Further Instruments and Actions. The parties agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement. The Key Holder agrees to cooperate affirmatively with the Company and the Investor, to the extent reasonably requested by the Company or the Investor, to enforce rights and obligations pursuant hereto.
 
10.           Term. This Agreement shall terminate upon the earlier of (i) the closing of a Qualified Public Offering, (ii) such date as the Series D Preferred Stock is redeemed pursuant to the Series D Certificate of Designations, (iii) such time as the number of shares of the Company’s Common Stock, including Common Stock underlying any Equity Securities, held by the Investor is less than 25% of the total number of shares of the Company’s Common Stock constituting or underlying all Equity Securities held by the Investor as of (x) the closing of the transactions contemplated by the Series D Purchase Agreement or (y) the Series E Closing (if such closing shall have been consummated), and (iv) the closing of the Company’s sale of all or substantially all of its assets or the acquisition of the Company by another entity by means of merger, consolidation or other transaction or series of related transactions resulting in the exchange of the outstanding shares of the Company’s capital stock such that the stockholders of the Company prior to such transaction own, directly or indirectly, less than 50% of the voting power of the surviving entity.
 
11.           Entire Agreement. This Agreement contains the entire understanding of the parties hereto with respect to the subject matter hereof, supersedes all other agreements between or among any of the parties with respect to the subject matter hereto, and cannot be altered or otherwise amended except pursuant to an instrument in writing signed by each of the parties to this Agreement. This Agreement shall be interpreted under the laws of the State of New York as applied to agreements among New York residents, made and to be performed entirely within the State of New York.
 
12.           Amendments and Waivers. Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company, the written consent of the Key Holders, and the written consent of the Investor. Any amendment or waiver effected in accordance with this paragraph shall be binding upon the parties and their respective successors and assigns.
 
 
- 9 -
 
13.           Severability. If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired, unless the provisions held invalid, illegal or unenforceable shall substantially impair the benefits of the remaining provisions hereof.
 
14.           Attorney’s Fees. In the event that any dispute among the parties to this Agreement should result in litigation, the prevailing party in such dispute shall be entitled to recover from the losing party all fees, costs and expenses of enforcing any right of such prevailing party under or with respect to this Agreement, including without limitation, such reasonable fees and expenses of attorneys and accountants, which shall include, without limitation, all fees, costs and expenses of appeals.
 
15.           Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  Delivery of an executed Agreement by one party to the other may be made by facsimile, electronic or PDF transmission.
 
[Remainder of page intentionally left blank.]
 

 
- 10 -
 
IN WITNESS WHEREOF, the parties hereto have executed this Right of First Refusal and Co-Sale Agreement as of the date first written above.
 
 
 
COMPANY:
 
YOU ON DEMAND HOLDINGS, INC.
 
 
     
 
By:
 /s/ Mark Urbach  
   
Name: Mark Urbach
   
Title: President & CEO
 
 
[Signature Page to Right of First Refusal and Co-Sale Agreement]
 
 
 
 
 
 
INVESTOR:
 
C MEDIA LIMITED
 
 
     
 
By:
 /s/ Xuesong Song  
   
Name: Xuesong Song
   
Title: Chairman and CEO

 
 
[Signature Page to Right of First Refusal and Co-Sale Agreement]
 
 
 
 
 
 
 
 
KEY HOLDERS:
 
   
  /s/ Shane McMahon  
 
Shane McMahon
   
 
 
  /s/ Weicheng Liu  
  Weicheng Liu

 
 
 
 
[Signature Page to Right of First Refusal and Co-Sale Agreement]
 EX-99.4 4 votingagrmt.htm votingagrmt.htm
Exhibit 99.4
 
VOTING AGREEMENT
 
This VOTING AGREEMENT, dated as of [_______ __], 2013 (this “Agreement”), is made by and among C Media Limited (“C Media”), Shane McMahon (“McMahon”) and Weicheng Liu (“Liu”, and collectively with C Media and McMahon, the “Stockholders”).

WHEREAS, each of the Stockholders currently either owns or has voting power over such shares of voting securities of YOU On Demand Holdings, Inc., a Nevada corporation (the “Corporation”), as set forth on Schedule I to this Agreement; and

WHEREAS, as of the date hereof, the board of directors of the Corporation (the “Board of Directors”) is comprised of the individuals as set forth on Schedule II to this Agreement.

NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

1.           Definitions.
 
“Governmental Authority” means the government of any nation, state, city, locality or other political subdivision of any thereof, and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government or any international regulatory body or self-regulatory organization having or asserting jurisdiction over a Person, its business or its properties.
 
“Independent Director” means a director of the Corporation who is independent as defined in applicable SEC and NASDAQ rules and regulations, and who constitutes an “Independent Director” as defined in NASDAQ Marketplace Rule 5605.
 
“Person” means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint-stock company, company, limited liability company, trust, unincorporated association, Governmental Authority, or any other entity of whatever nature.
 
“Requirement of Law” means, as to any Person, the certificate of incorporation and bylaws or other organizational or governing documents of such Person, and any law (including, without limitation, laws related to taxes and environmental Laws), treaty, rule, regulation, ordinance, qualification, standard, license or franchise or determination of an arbitrator or a court or other Governmental Authority, including the NYSE or NASDAQ or any national securities exchange or automated quotation system on which the Common Stock is listed or admitted to trading, in each case applicable to, or binding upon, such Person or any of its property or to which such Person or any of its property is subject or pertaining to any or all of the transactions contemplated hereby.
 
“Shares” means (1) the presently issued and outstanding shares of common stock and preferred stock of the Corporation, (2) any additional shares of common stock and preferred stock hereafter issued and outstanding, (3) any shares of capital stock of the Corporation into
 
 
 
 
which such shares may be converted or for which they may be exchanged and (4) any option, warrant or other security of the Corporation entitling the holder thereof to purchase such common stock or preferred stock, or securities convertible into or exchangeable or exercisable for such common stock or preferred stock.
 
2.           Representations of Each of the Stockholders.
 
Each Stockholder hereby represents and warrants to the other Stockholders that:
 
(a)           (i) such Stockholder owns beneficially (as such term is defined in Rule 13d-3 under the Exchange Act) all of the Shares ascribed to such Shareholder on Schedule I hereto, (ii) such stockholder does not beneficially own any voting securities of the Corporation other than as set forth on Schedule I hereto, and (iii) except pursuant hereto or as set forth on Schedule I hereto, there are no options, warrants or other rights, agreements, arrangements or commitments of any character to which such Stockholder is a party relating to the voting of any of such Shares and there are no voting trusts or voting agreements with respect to such Shares.
 
(b)           Such Stockholder has the corporate power and authority or the legal capacity, as applicable, to enter into, execute and deliver this Agreement and to perform fully such Stockholder’s obligations hereunder, and this Agreement has been duly and validly executed and delivered by such Stockholder and constitutes the legal, valid and binding obligation of such Stockholder, enforceable against such Stockholder in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability, and equitable principles.
 
(c)           None of the execution and delivery of this Agreement by such Stockholder, the consummation by such Stockholder of the transactions contemplated hereby or compliance by such Stockholder with any of the provisions hereof will conflict with or result in a breach, or constitute a default (with or without notice of lapse of time or both) under any provision of, any trust agreement, loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument or Requirement of Law applicable to such Stockholder or to such Stockholder’s property or assets.
 
(d)           No consent, approval or authorization of, or designation, declaration or filing with, any Governmental Authority or other Person on the part of such Stockholder is required in connection with the valid execution and delivery of this Agreement.
 
3.           Directors.
 
(a)           Election.  From the date hereof until termination of this Agreement in accordance with Section 6 hereof, at any annual or special meeting of stockholders at which the stockholders of the Corporation will have the right to, or will vote for, or consent to, setting the size of the Board of Directors or electing the members of the Board of Directors, the Stockholders shall vote all Shares then owned by them (including, Shares hereafter acquired by them) in favor of the election to, and of maintaining, the Board of Directors, consisting of seven (7) members designated in the following manner:
 
 
 
(i) two (2) directors shall be designated by McMahon (the “McMahon Designees”), at least one of which shall be an Independent Director, who are initially McMahon and [____________]; and
 
(ii) two (2) directors shall be designated by Liu (the “Liu Designees”), at least one of which shall be an Independent Director, who are initially Liu and [____________]; and
 
(iii) three (3) directors shall be designated by C Media (the “C Media Designees”), at least two of which shall be Independent Directors, who are initially Xuesong Song, [____________] and [____________].

(b)           Vacancies.  Any vacancy in the office of a director designated pursuant to subsection (a) of this Section may be filled by and only by the affirmative vote or written consent of that person or persons which has the power to designate that director pursuant to subsection (a).
 
4.           No Voting Trusts or Other Arrangement.
 
Each Stockholder agrees that during the term of this Agreement such Stockholder will not, and will not permit any entity under such Stockholder’s control to, deposit any of such Stockholder’s Shares in a voting trust, grant any proxies with respect to such Shares or subject any of such Shares to any arrangement with respect to the voting of such Shares other than agreements entered into with the other Stockholders.
 
5.           Additional Shares.
 
Each Stockholder agrees that all shares of voting securities of the Corporation that such Stockholder purchases, acquires the right to vote or otherwise acquires beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) of after the execution of this Agreement shall be subject to the terms of this Agreement and shall constitute Shares for all purposes of this Agreement.
 
6.           Termination.
 
The rights and obligations of each Stockholder under this Agreement shall terminate on the third (3rd) anniversary of the date hereof.
 
7.           No Agreement as Director or Officer.
 
Each Stockholder hereby agrees that nothing in this Agreement (a) will limit or affect any actions or omissions taken by any Stockholder in his capacity as a director or officer of the Corporation, and no such actions or omissions shall be deemed a breach of this Agreement or (b) will be construed to prohibit, limit or restrict any Stockholder from exercising such
 
 
 
Stockholder’s fiduciary duties as an officer or director of the Corporation or any of its subsidiaries or their respective stockholders.
 
8.           Specific Performance.
 
Each party hereto acknowledges that it will be impossible to measure in money the damage to the other party if a party hereto fails to comply with any of the obligations imposed by this Agreement, that every such obligation is material and that, in the event of any such failure, the other party will not have an adequate remedy at law or damages. Accordingly, each party hereto agrees that injunctive relief or other equitable remedy, in addition to remedies at law or damages, is the appropriate remedy for any such failure and will not oppose the seeking of such relief on the basis that the other party has an adequate remedy at law. Each party hereto agrees that it will not seek, and agrees to waive any requirement for, the securing or posting of a bond in connection with the other party’s seeking or obtaining such equitable relief.
 
9.           Entire Agreement.
 
This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein and therein.  There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein or therein.  This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.
 
10.           Notices.
 
All notices or other communications required or permitted hereunder shall be in writing and shall be delivered personally, telecopied or sent by certified, registered or express mail, postage prepaid.  Any such notice shall be deemed given if delivered personally or telecopied during regular business hours, on the date of such delivery (or the following business day if delivered or telecopied after regular business hours), or if sent by reputable overnight courier, on the first Business Day following the date of such mailing, as follows:
 
(i)             if to McMahon:
 
Mr. Shane McMahon
YOU On Demand Holdings, Inc.
27 Union Square West, Suite 502
New York, New York 10003
Facsimile: (212) 206-9112
 
with a copy to:
 
Pillsbury Winthrop Shaw  Pittman LLP
2300 N Street
Washington DC  20037
Attention: Louis Bevilacqua

 
 
 

Facsimile: (212) 663-8007
 
and
 
K&L Gates LLP
599 Lexington Avenue
New York, NY 10022
Attention: Jack Vaughan
Facsimile: (212) 536-3901

(ii)           if to Liu:
 
Mr. Weicheng Liu
YOU On Demand Holdings, Inc.
27 Union Square West, Suite 502
New York, New York 10003
Facsimile: (212) 206-9112
 
with a copy to:
 
Pillsbury Winthrop Shaw Pittman LLP
2300 N Street
Washington DC  20037
Attention: Louis Bevilacqua
Facsimile: (212) 663-8007
 
(iii)             if to C Media:
 
C Media Limited
CN11 Legend Town,
No. 1 Balizhuangdongli, Chaoyang District
Beijing, China 100025
Attn: Victor Chen, Vice President
Rainer Li, CFO
Facsimile: 86 10 8586 2775

with a copy to:
 
Reed Smith LLP
599 Lexington Ave.
New York, New York 10022
Attn: William N. Haddad
Facsimile: (212) 521-5400
 

 
 
 
Any party may by notice given in accordance with this Section designate another address or Person for receipt of notices hereunder.
 
11.           Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by and construed in accordance with the Requirements of Law of the State of New York without giving effect to the principles of conflict of laws.  Each of the parties hereto hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the courts of the State of New York and of the United States of America, in each case located in the County of New York, for any action or proceeding arising out of or relating to this Agreement (and agrees not to commence any action or proceeding relating thereto except in such courts), and further agrees that service of any process, summons, notice or document by U.S. registered mail to its respective address set forth in this Agreement, or such other address as may be given by one or more parties to the other parties in accordance with the notice provisions of Section 10 hereof, shall be effective service of process for any action, suit or proceeding brought against it in any such court.  Each of the parties hereto hereby irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement or the transactions contemplated hereby in the courts of the State of New York or the United States of America, in each case located in the County of New York, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such Action brought in any such court has been brought in an inconvenient forum. Each of the parties irrevocably and unconditionally waives, to the fullest extent permitted by applicable Requirements of Law, any and all rights to trial by jury in connection with any action, suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.
 
12.           Severability.
 
(a)           If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held to violate the requirements of NASDAQ, the NYSE or any national securities exchange or automated quotation system on which the shares of common stock of the Corporation is listed or admitted to trading, then the parties hereto shall make such amendments or modifications necessary to comply with such rules and maintain the purpose and intent of this Agreement.
 
(b)           If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired, unless the provisions held invalid, illegal or unenforceable shall substantially impair the benefits of the remaining provisions hereof.
 
13.           Counterparts.  This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, all of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.
 
14.           Further Assurances.  Each party hereto shall execute and deliver such additional documents as may be necessary or desirable to effect the transactions contemplated by this Agreement.
 

 
 
 

15.           Headings.  The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.
 
16.           Assignment.  None of the parties to this Agreement may assign any of its rights or obligations under this Agreement without the prior written consent of the other parties hereto. Any assignment contrary to the provisions of this Section 16 shall be null and void.
 
[SIGNATURE PAGES FOLLOW]

 
 
 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the date first written above.
 
 
C MEDIA LIMITED
 
 
By_____________________
Name: Xuesong Song
Title:  Chairman and CEO


[Signature Page to Board Voting Agreement]
 
 
 


 
MCMAHON
 
 
By_____________________
     Shane McMahon
 


[Signature Page to Board Voting Agreement]
 
 
 


 
LIU
 
 
By_____________________
     Weicheng Liu
 
 


[Signature Page to Board Voting Agreement]
 
 
 

Schedule I
 
Shares Held by the Stockholders
 
C Media:
 
 
●
[_______] shares of Series E Preferred Stock of the Corporation
 
 
●
7,000,000 shares of Series A Preferred Stock of the Corporation
 

 
McMahon:
 
 
●
[_______] shares of common stock of the Corporation
 
 
●
Options to purchase an aggregate of [_______] shares of common stock of the Corporation
 
 
●
Shares of common stock underlying that certain Convertible Promissory Note, dated May 10, 2012, as amended, made by the Corporation in $3,000,000 principal amount.
 

 
Liu:
 
 
●
[_______] shares of common stock of the Corporation
 
 
●
Options to purchase an aggregate of [_______] shares of common stock of the Corporation
 
 

 
 
 

Schedule II
 
Board of Directors of the Corporation
 
Shane McMahon
 
Weicheng Liu
 
Xuesong Song
 
[McMahon Designee]
 
[Liu Designee]
 
[C Media Designee]
 
[C Media Designee]