exv4w27





Exhibit 4.27




CERTAIN INFORMATION (INDICATED BY ASTERISKS) IN THIS EXHIBIT HAS

BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN

REQUESTED WITH RESPECT TO THE OMITTED PORTION.






SHAREHOLDERS AGREEMENT




by and among



FOCUS MEDIA HOLDING LIMITED



JJ MEDIA INVESTMENT HOLDING LIMITED



FRONT LEAD INVESTMENTS LIMITED



LIMIN LI



and



VISIONCHINA MEDIA INC.



as of



January 13, 2011




 









 








TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	ARTICLE I CERTAIN DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	Defined Terms
	 	 	1	 
	Interpretation and Rules of Construction
	 	 	5	 
	 
	 	 	 	 
	ARTICLE II governance matters
	 	 	5	 
	 
	 	 	 	 
	Board of Directors
	 	 	5	 
	 
	 	 	 	 
	ARTICLE III RESTRICTIONS ON TRANSFER
	 	 	7	 
	 
	 	 	 	 
	Transfer Restrictions on Common Shares
	 	 	7	 
	Permitted Transfers of Common Shares
	 	 	8	 
	Right of First Offer with Respect to Transfers by the Existing Shareholder, the
Controller of the Existing Shareholder and the Focus Shareholder
	 	 	10	 
	Right of First Offer with Respect to Transfers by the JJ Media Shareholder
	 	 	11	 
	 
	 	 	 	 
	ARTICLE IV TERM AND TERMINATION
	 	 	13	 
	 
	 	 	 	 
	Term
	 	 	13	 
	Termination by Focus Shareholder or JJ Media Shareholder
	 	 	14	 
	Termination by Existing Shareholder, Controller, or the Company
	 	 	14	 
	Defaulting Party
	 	 	14	 
	 
	 	 	 	 
	ARTICLE V GOVERNING LAW; ARBITRATION
	 	 	14	 
	 
	 	 	 	 
	Governing Law
	 	 	14	 
	Arbitration
	 	 	14	 
	 
	 	 	 	 
	ARTICLE VI MISCELLANEOUS
	 	 	15	 
	 
	 	 	 	 
	Entire Agreement; Amendments
	 	 	15	 
	Waiver
	 	 	15	 
	Assignment
	 	 	15	 
	Severability
	 	 	16	 
	Remedies
	 	 	16	 
	Headings
	 	 	16	 
	Notices
	 	 	16	 
	Further Assurances
	 	 	18	 
	Counterparts
	 	 	18	 






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SHAREHOLDERS AGREEMENT 




          THIS SHAREHOLDERS AGREEMENT, dated as of January 13, 2011 (this “Agreement”), is made
by and among VISIONCHINA MEDIA INC., a company organized under the laws of the Cayman Islands (the
“Company”), FOCUS MEDIA HOLDING LIMITED, a company organized under the laws of the Cayman
Islands (the “Focus Shareholder”), JJ MEDIA INVESTMENT HOLDING LIMITED, a company organized
under the laws of the British Virgin Islands (the “JJ Media Shareholder”), FRONT LEAD
INVESTMENTS LIMITED, a company organized under the laws of the British Virgin Islands (the
“Existing Shareholder”), and Limin Li, an individual whose PRC ID no. is 440301610103081
(each a “Party” and collectively the “Parties”).




RECITALS




          WHEREAS, the Focus Shareholder and the Company, among others, have entered into a Securities
Purchase Agreement dated as of December 30, 2010 (the “Securities Purchase Agreement”),
pursuant to which, among other things, the Focus Shareholder will purchase from the Company, and
the Company will issue to the Focus Shareholder, 15,331,305 common shares, par value US$0.0001 per
share, of the Company (the “Common Shares”) at the Closing;




          WHEREAS, the Existing Shareholder owns 16,507,762 Common Shares immediately prior to the
Closing; and




          WHEREAS, it is a condition to the Closing under the Securities Purchase Agreement that the
Parties shall have executed this Agreement.




          NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants and
agreements set forth herein, the Parties, intending to be legally bound hereby, agree as follows:




ARTICLE I

CERTAIN DEFINITIONS 




          1.1. Defined Terms. Unless specifically indicated otherwise in this Agreement, the
following defined terms shall have the meanings ascribed thereto in this Article I.




          “Affiliate” means, with respect to any specified Person, any other Person that
directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under
common control with, such specified Person, and with respect to an individual also means any
spouse, parent, child, brother or sister of such Person.




          “Affiliate Transferee” has the meaning set forth in Section 3.2(a).





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          “Agreement” means this Shareholders Agreement and the schedules and exhibits
hereto, as the same may be amended, modified, supplemented or restated from time to time in
accordance with the terms hereof.




          “Articles of Association” means, with respect to the Company, the memorandum and
articles of association of the Company, as amended from time to time.




          “Beneficial Owner” and “Beneficially Own” have the meaning set forth in Rules
13d-3 and 13d-5 of the Exchange Act.




          “Board of Directors” has the meaning set forth in Section 2.1(a).




          “Business Day” means any day that is not a Saturday, a Sunday or other day on which
banks are required or authorized by Law to be closed in Beijing, the PRC, and New York, New York,
USA.




          “Closing” means the Closing as defined under the Securities Purchase Agreement.




          “Common Shares” has the meaning set forth in the Recitals.




          “Company” has the meaning set forth in the preamble to this Agreement.




          “control” (including, with correlative meanings, the terms “controlled by” and
“under common control with”) when used with respect to any Person, means the possession,
directly or indirectly, of the power to cause the direction of management and/or policies of such
Person, whether through the ownership of voting securities, by contract, agency or otherwise;
provided that no Shareholder shall be deemed an Affiliate of any other Shareholder solely
by reason of any investment in the Company. For purposes of this Agreement, the Existing
Shareholder “controlled” by a Controller shall mean the Existing Shareholder whose name is set out
next to the name of that Controller in Schedule 1.




          “Controller” means any Party who controls the Existing Shareholder and includes the
Parties listed in Schedule 1 as “Controllers” and “Controller” means any one of them.




          “Controller Affiliate Transferee” has the meaning set forth in Section 3.2(d).




          “Defaulting Party” has the meaning set forth in Section 4.4.




          “Dispute” has the meaning set forth in Section 5.2.




          “Exchange” means the NASDAQ National Market.




          “Exchange Act” means the United States Securities and Exchange Act of 1934, as
amended, and the rules and regulations issued thereunder.




          “Existing Shareholder” has the meaning set forth in the preamble to this Agreement.







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          “Existing Shareholder RFO Exercise Notice” has the meaning set forth in Section
3.4(e).




          “Existing Shareholder RFO Notice” has the meaning set forth in Section 3.4(d).




          “Existing Shareholder RFO Response Period” has the meaning set forth in Section
3.4(e).




          “Existing Shareholder Right of First Offer” has the meaning set forth in Section
3.4(e).




          “Focus Shareholder” has the meaning set forth in the preamble to this Agreement.




          “Focus Group Shareholder” shall mean any of (i) Focus Shareholder and (ii) each of its
Affiliates that is a Shareholder in accordance with the terms and provisions of this Agreement from
time to time.




          “Focus Nominee” has the meaning set forth in Section 2.1(b).




          “Focus RFO Exercise Notice” has the meaning set forth in Section 3.4(c).




          “Focus RFO Notice” has the meaning set forth in Section 3.4(b).




          “Focus RFO Response Period” has the meaning set forth in Section 3.4(c).




          “Focus Right of First Offer” has the meaning set forth in Section 3.4(c).




          “Governmental Authority” means any national, federal, state, local or foreign or
domestic government or political subdivision thereof, governmental department, commission
(including without limitation the U.S. Securities and Exchange Commission), court, arbitrator,
board, bureau, agency, regulatory authority, instrumentality, tribunal, judicial statutory or
administrative body having jurisdiction over the matter or matters in question.




          “HKIAC” has the meaning set forth in Section 5.2(a).




          “Immediate Family Member” means, with respect to any natural person, (a) such person’s
spouse, parents, grandparents, children, grandchildren and siblings (in each case whether adoptive
or biological), (b) current spouses of such person’s children, grandchildren and siblings (in each
case whether adoptive or biological), and (c) estates, trusts, partnerships and other entities of
which a material portion of the interests are held directly or indirectly by the foregoing.




          “JJ Media Shareholder” has the meaning set forth in the preamble to this Agreement.




          “JJ Media RFO Common Shares” has the meaning set forth in Section 3.4(b).




          “JJ Media RFO Purchase Period” has the meaning set forth in Section 3.4(f).







- 3 -









 








          “JJ Media Transfer Shares” has the meaning set forth in Section 3.4(g).




          “Law” means any federal, national, supranational, state, provincial, local or similar
statute, law, ordinance, regulation, rule, code, order, requirement or rule of law (including
common law).




          “Lien” means, with respect to any asset (including any security) any mortgage,
assignment of receivables, debenture, lien, claim, charge (whether fixed or floating), pledge,
title retention, right to acquire, hypothecation, security interest, option, levy, proxy, right of
first refusal, and any other encumbrance or condition whatsoever, but excluding any right of first
offer provided for under this Agreement.




          “Lock Up Period” has the meaning set forth in Section 3.1(a).




          “Party” or “Parties” has the meaning set forth in the preamble to this
Agreement.




          “Permitted Transfer” has the meaning set forth in Section 3.2.




          “Person” means an individual, a partnership, a corporation, an association, a limited
liability company, a joint stock company, a trust, a joint venture, an unincorporated organization,
a group, a Governmental Authority or any other type of entity.




          “PRC” means the People’s Republic of China.




          “RFO Common Shares” has the meaning set forth in Section 3.3(b).




          “RFO Exercise Notice” has the meaning set forth in Section 3.3(c).




          “RFO Notice” has the meaning set forth in Section 3.3(b).




          “RFO Offeror” has the meaning set forth in Section 3.3(a).




          “RFO Purchase Period” has the meaning set forth in Section 3.3(d).




          “RFO Response Period” has the meaning set forth in Section 3.3(c).




          “Right of First Offer” has the meaning set forth in Section 3.3(c).




          “Securities Purchase Agreement” has the meaning set forth in the preamble to this
Agreement.




          “Shareholders” means (i) each Focus Group Shareholder, (ii) the Existing Shareholder
and (iii) each Person who becomes a party to or bound by the provisions of this Agreement in
accordance with its terms.




          “Transfer” shall mean any direct or indirect sale, transfer, gift, assignment, or
other disposition, and “Transferred” shall be construed accordingly.




          “Transfer Period” has the meaning set forth in Section 3.3(e).







- 4 -









 








          “UNCITRAL Rules” has the meaning set forth in Section 5.2(a).




          “U.S. Dollars” or “US$” means United States dollars, the official currency of
the United States of America.




          1.2. Interpretation and Rules of Construction. In this Agreement, except to the
extent that the context otherwise requires:




          (a) when a reference is made in this Agreement to an Article, Section, Exhibit or Schedule,
such reference is to an Article or Section of, or a Schedule to, this Agreement unless otherwise
indicated;




          (b) the table of contents and headings for this Agreement are for reference purposes only and
do not affect in any way the meaning or interpretation of this Agreement;




          (c) whenever the words “include,” “includes” or “including” are used in this Agreement, they
are deemed to be followed by the words “without limitation”;




          (d) the words “hereof,” “herein” and “hereunder” and words of similar import, when used in
this Agreement, refer to this Agreement as a whole and not to any particular provision of this
Agreement;




          (e) all terms defined in this Agreement have the defined meanings when used in any certificate
or other document made or delivered pursuant hereto, unless otherwise defined therein;




          (f) the definitions contained in this Agreement are applicable to the singular as well as the
plural forms of such terms;




          (g) any Law referred to herein or in any agreement or instrument that is referred to herein
means such Law or statute as from time to time amended, modified or supplemented, including by
succession of comparable successor Laws;




          (h) references to a Person are also to its permitted successors and assigns;




          (i) a rule of construction does not apply to the disadvantage of a party because the party was
responsible for the preparation of this agreement or any part of it; and




          (j) the use of “or” is not intended to be exclusive unless expressly indicated otherwise.




ARTICLE II

GOVERNANCE MATTERS




          2.1. Board of Directors.




          (a) The Existing Shareholder and the Company shall cause to be nominated and exercise their
respective reasonable best efforts to cause to be elected, in each case subject to






- 5 -









 







the Articles of Association and applicable Law, one appropriately qualified designee of the
Focus Shareholder to the Board of Directors of the Company (the “Board of Directors”) on or
before June 30, 2011. Thereafter, for so long as the Focus Shareholder, together with its
Affiliates, owns at least five percent (5%) or more of all of the outstanding Common Shares
(counting for such purposes all Common Shares into or for which the securities of the Company owned
by the Focus Shareholder and its Affiliates are directly or indirectly convertible or exercisable),
at any election of directors of the Company, the Focus Shareholder shall have the right to nominate
one candidate for election to the Board of Directors. The Company and the Existing Shareholder
shall use their respective reasonable best efforts to cause such person (or any substitute or
replacement designated or nominated by the Focus Shareholder) to be a candidate recommended by the
Board of Directors and elected a Director of the Company, including soliciting proxies for such
person to the same extent it does for any other nominees of its Board of Directors.




          (b) Any person nominated or designated pursuant to this Section 2.1 shall be a “Focus
Nominee.” Prior to the Focus Nominee being elected to the Board of Directors, the Existing
Shareholders and the Company shall use their respective reasonable best efforts to cause one
designee of the Focus Shareholder to be appointed an observer to attend all meetings of the Board
of Director in a nonvoting capacity. The Company shall provide such observer with copies of all
notices, minutes, consents and other materials that it provides to the Directors at the same time
and in the same manner as provided to the Directors and notify such observer of all regular and
special meetings of any committee of the Board of Directors. For the avoidance of doubt, such
observer shall not be entitled to attend any meeting of any committee of the Board of Directors.




          (c) Notwithstanding anything to the contrary contained herein, if the Focus Nominee resigns,
is removed pursuant to Section 2.1(d) or otherwise, or is unable to continue to serve as a Director
of the Company, the Focus Shareholder may designate a replacement Director and the Existing
Shareholder and the Company shall use their respective reasonable best efforts to cause such person
to be elected a Director, provided however, that in each case, the Focus Shareholder remains
entitled to nominate and designate one Director pursuant to this Section 2.1.




          (d) Any Director of the Company may be removed from the Board of Directors in accordance with
applicable law and the governing documents of the Company; provided, however, that with respect to
the Focus Nominee, neither the Existing Shareholder nor the Company shall take any action to cause
any such removal without the prior written consent of the Focus Shareholder unless such removal is
required by applicable law or such Director is no longer qualified to serve as a Director pursuant
to applicable SEC or regulatory requirements, or a generally applicable policy of the Board of
Directors.




          (e) The Company and the Existing Shareholder shall ensure, to the extent permitted by
applicable law, that any Directors nominated or designated pursuant to this Section 2.1 shall enjoy
the same rights, capacities, entitlements, indemnification rights and compensation as any other
members of the Board of Directors. The Focus Nominee shall be entitled to reimbursement for
documented, reasonable out-of-pocket expenses incurred in attending meetings of the Board of
Directors (or any committee thereof) to the same extent as






- 6 -









 







other members of the Board of Directors. The Company shall notify the Focus Nominee of all regular
meetings and special meetings of the Board of Directors and, if the Focus Nominee is a member of
any committee thereof, of all regular and special meetings of such committee. The Company shall
provide the Focus Nominee with copies of all notices, minutes, consents and other material that it
provides to all other members of the Board of Directors concurrently with such materials being
provided to the other members.




          (f) The Company and the Existing Shareholder shall not take any action that would result in
any amendment to the governing documents of the Company inconsistent with the provisions of this
Section 2.1.




ARTICLE III

RESTRICTIONS ON TRANSFER 




          3.1. Transfer Restrictions on Common Shares.




          (a) For a period of 180 days commencing on the date of Closing (the “Lock Up Period”),
neither the Existing Shareholder nor the Controller of such Existing Shareholder, as the case may
be, shall, directly or indirectly, Transfer or grant or suffer to exist any Lien with respect to
any Common Shares from time to time held, owned or Beneficially Owned by the Existing Shareholder
or the Controller of such Existing Shareholder, as the case may be, or any equity interests in the
Existing Shareholder held, directly or indirectly, by the Controller of such Existing Shareholder
other than the Permitted Transfers set forth in Section 3.2.




          (b) Following the Lock Up Period until the earlier of (i) the [***] of the date on which the
Lock Up Period expires, and (ii) the date on which the Focus Shareholder, together with its
Affiliates, owns less than [***] of all of the outstanding Common Shares (counting for such
purposes all Common Shares into or for which the securities of the Company owned by the Focus
Shareholder and its Affiliates are directly or indirectly convertible or exercisable) (the
“Existing Shareholder Restrictive Period”), neither the Existing Shareholder nor the
Controller of the Existing Shareholder shall, directly or indirectly, Transfer or grant or suffer
to exist any Lien with respect to any Common Shares from time to time held, owned or Beneficially
Owned by the Existing Shareholder or the Controller of the Existing Shareholder, as the case may
be, or any equity interests in the Existing Shareholder held, directly or indirectly, by the
Controller of the Existing Shareholder other than Permitted Transfers set forth in Section 3.2 or
Transfers pursuant to Section 3.3.




          (c) Following the date of the Closing until the earlier of (i) the [***] of the date on which
the Lock Up Period expires, and (ii) the date on which the Existing Shareholder, together with its
Affiliates, owns less than [***] of all of the outstanding Common Shares (counting for such
purposes all Common Shares into or for which the securities of the Company owned by the Existing
Shareholder and its Affiliates are directly or indirectly convertible or exercisable) (the
“Focus Shareholder Restrictive Period”), the Focus Shareholder may not, directly or
indirectly, Transfer or grant or suffer to exist any Lien with respect to any Common Shares from
time to time held, owned or Beneficially Owned by it other than Permitted Transfers set forth in
Section 3.2 or Transfers pursuant to Section 3.3.







- 7 -









 








          (d) Following the date of the Closing until the earlier of (i) the [***] of the date on which
the Lock Up Period expires, and (ii) the date on which each of the Existing Shareholder, together
with its Affiliates, and the Focus Shareholder, together with its Affiliates owns less than [***]
of all of the outstanding Common Shares (counting for such purposes all Common Shares into or for
which the securities of the Company owned by the Existing Shareholder and its Affiliates or the
Focus Shareholder and its Affiliates, as the case may be, are directly or indirectly convertible or
exercisable) (the “JJ Media Shareholder Restrictive Period”), the JJ Media Shareholder may
not, directly or indirectly, Transfer or grant or suffer to exist any Lien with respect to any
Common Shares from time to time held, owned or Beneficially Owned by it other than Permitted
Transfers set forth in Section 3.2 or Transfers pursuant to Section 3.4.




          (e) Any attempt by any of the Focus Shareholder, the JJ Media Shareholder, the Existing
Shareholder and the Controller of such Existing Shareholder to Transfer or grant or suffer to exist
any Lien (by operation of law or otherwise) with respect to any Common Shares or any equity
interests in the Existing Shareholder held, directly or indirectly, by the Controller of the
Existing Shareholder in violation of this ARTICLE III shall be null and void and the Company shall
not give any effect to such attempted Transfer or Lien in the Company’s books and records.




          3.2. Permitted Transfers of Common Shares. Subject to any applicable restrictions on
Transfer of Common Shares under the Securities Purchase Agreement, the following Transfers of
Common Shares or equity interests in the Existing Shareholder held, directly or indirectly, by the
Controller of the Existing Shareholder (each a “Permitted Transfer”) shall be permitted in
accordance with the following provisions:




          (a) At any time, the Transfer of Common Shares by any of the Focus Shareholder, the JJ Media
Shareholder and the Existing Shareholder to its Affiliate (such Affiliate, the “Affiliate
Transferee”), provided that:




               (i) such Affiliate Transferee shall become a party to this Agreement and shall be bound by the
terms of this Agreement as the Focus Shareholder, the JJ Media Shareholder or an Existing
Shareholder, as the case may be;



               (ii) the Focus Shareholder, the JJ Media Shareholder or the Existing Shareholder, as the case
may be, and the Affiliate Transferee shall be jointly and severally liable for any breach by either
of them of this Agreement; and



               (iii) prior to ceasing to be an Affiliate of the Focus Shareholder, the JJ Media Shareholder
or the Existing Shareholder, as the case may be, such Affiliate Transferee shall Transfer such
Common Shares back to the Focus Shareholder, the JJ Media Shareholder or the Existing Shareholder,
as the case may be, or to another Affiliate of the Focus Shareholder, the JJ Media Shareholder or
the Existing Shareholder, as the case may be, in a Permitted Transfer;



          (b) Following the Lock Up Period, if applicable, the Transfer of Common Shares pursuant to
Rule 144 of the Securities Exchange Act of 1934, as amended;







- 8 -









 








          (c) Following the Lock Up Period, if applicable, the Transfer of Common Shares pursuant to a
firm commitment underwritten public offering registered under the Securities Act of 1933, as
amended;




          (d) At any time, the Transfer of equity interests in the Existing Shareholder held, directly
or indirectly, by the Controller of such Existing Shareholder to its Affiliate or Immediate Family
Member (such Affiliate, the “Controller Affiliate Transferee”), provided that:




               (i) prior written notice has been given to the Focus Shareholder;



               (ii) the Controller of such Existing Shareholder and Controller Affiliate Transferee shall be
jointly and severally liable for any breach by either of them of this Agreement; and



               (iii) prior to ceasing to be an Affiliate or Immediate Family Member of the Controller of such
Existing Shareholder, such Controller Affiliate Transferee shall Transfer such direct or indirect
equity interests in the Existing Shareholder back to the Controller of such Existing Shareholder or
to another Affiliate or Immediate Family Member of the Controller of such Existing Shareholder in a
Permitted Transfer; or



          (e) At any time during the Existing Shareholder Restrictive Period, the Transfer or grant of
any Lien with respect to Common Shares by the Existing Shareholder where the Focus Shareholder has
provided its prior written consent to such Transfer or grant of Lien and a written waiver of all of
its rights under this ARTICLE III with respect to such Transfer or grant of Lien.




          (f) At any time during the Focus Shareholder Restrictive Period, the Transfer or grant of any
Lien with respect to Common Shares by the Focus Shareholder where the Existing Shareholder has
provided its prior written consent to such Transfer or grant of Lien and a written waiver of all of
its rights under this ARTICLE III with respect to such Transfer or grant of Lien.




          (g) At any time during the JJ Media Shareholder Restrictive Period, the Transfer or grant of
any Lien with respect to Common Shares by the JJ Media Shareholder where the Existing Shareholder
or the Focus Shareholder or each of them, to the extent that such Party or Parties shall be
entitled to any rights under Section 3.4, has provided its prior written consent to such Transfer
or grant of Lien and a written waiver of all of its rights under this ARTICLE III with respect to
such Transfer or grant of Lien.




          (h) At any time, the Transfer of Common Shares by any of the Existing Shareholder, the Focus
Shareholder, and the JJ Media Shareholder to any person pursuant to a trading plan under Rule
10b5-1 of the Exchange Act.




          (i) At any time, any Transfer of any equity interest in the Focus Media Holding Limited from
time to time directly or indirectly held, owned or Beneficially Owned by any Person to any other
Person.







- 9 -









 








          (j) At any time, any Transfer of any equity interest in the JJ Media Investment Holding
Limited from time to time directly or indirectly held, owned or Beneficially Owned by any Person to
any other Person.




          3.3. Right of First Offer with Respect to Transfers by the Existing Shareholder, the
Controller of the Existing Shareholder and the Focus Shareholder.




          (a) Subject to the lock up obligations under Section 4.1 of the Securities Purchase Agreement,
if any of the Existing Shareholder and the Controller of the Existing Shareholder desires to
Transfer any Common Shares from time to time directly or indirectly held, owned or Beneficially
Owned by the Existing Shareholder or the Controller of such Existing Shareholder, as the case may
be, or any equity interest in the Existing Shareholder held, directly or indirectly, by the
Controller of such Existing Shareholder during the Existing Shareholder Restrictive Period other
than pursuant to any Permitted Transfer, or if the Focus Shareholder desires to Transfer any Common
Shares from time to time directly or indirectly held, owned or Beneficially Owned by it during the
Focus Shareholder Restrictive Period, such Transfer shall be permitted only if the Focus
Shareholder, the Existing Shareholder or the Controller of such Existing Shareholder, as the case
may be (the “RFO Offeror”), fully complies with any applicable restrictions on Transfer of
Common Shares under the Securities Purchase Agreement and the terms of this Section 3.3; provided
that the provisions of this Section 3.3 shall not apply to Permitted Transfers.




          (b) The RFO Offeror shall, prior to the Transfer of any Common Shares to which this Section
3.3 applies, give written notice (“RFO Notice”) to the Focus Shareholder, if the RFO
Offeror is the Existing Shareholder or the Controller of the Existing Shareholder, or to the
Existing Shareholder, if the RFO Offeror is the Focus Shareholder (the Focus Shareholder or the
Existing Shareholder, as the case may be, entitled to receive the RFO Notice, the “RFO
Holder”), setting forth (i) the number of Common Shares proposed to be Transferred (the
“RFO Common Shares”), (ii) the proposed purchase price per RFO Common Share, and payment
and other material terms and conditions and (iii) an irrevocable offer to sell to the RFO Holder
the RFO Common Shares set forth in the RFO Notice at the same price per share and on the same terms
and conditions as set forth therein. For the avoidance of doubt, this Section 3.3 does not
prohibit or restrict in any way the RFO Offeror from discussing, negotiating, or entering into any
discussion or negotiation with any third party for the sale of all or a portion of the Common
Shares held by the RFO Offeror.




          (c) The RFO Holder shall have the right to purchase (the “Right of First Offer”), all,
but not a portion, of the RFO Common Shares by delivering a written notice (the “RFO Exercise
Notice”) of exercise of the Right of First Offer to the RFO Offeror within twenty (20) days
from the date of delivery of the RFO Notice (the “RFO Response Period”), stating therein
all, but not a portion, of the RFO Common Shares shall be purchased, collectively, by the RFO
Holder and/or one or more wholly-owned Affiliates thereof. An RFO Exercise Notice shall be
irrevocable and shall be a valid and legally binding obligation of the RFO Holder to purchase all,
but not a portion, of the RFO Common Shares.




          (d) If the RFO Holder shall have delivered an RFO Exercise Notice to the RFO Offeror within
the RFO Response Period for all the RFO Common Shares, the RFO Offeror






- 10 -









 







shall be bound to sell all RFO Common Shares to the RFO Holder within thirty (30) days
thereafter (the “RFO Purchase Period”) upon the terms set forth in the RFO Notice;
provided, however, that such period shall be extended following such date as
necessary to permit all required approvals, consents or authorizations from, or filings or
registrations with, any Governmental Authority in connection with such purchase to be obtained or
made, to the extent prior to the expiration of the RFO Purchase Period reasonably appropriate
actions have been taken by the RFO Offeror to obtain such approvals, consents or authorizations, or
make such filings or registrations.




          (e) If the RFO Holder shall not have completed the purchase of all of the RFO Common Shares
within the RFO Purchase Period, as extended as provided in Section 3.3(d), or has failed to deliver
an RFO Exercise Notice within the RFO Response Period for all of the RFO Common Shares or declined
in writing to exercise the Right of First Offer, then the RFO Offeror shall have the right for one
hundred eighty (180) days thereafter (the “Transfer Period”), to dispose of the RFO Common
Shares in one or more Transfers thereof without being subject to any of the restrictions set forth
in this Article III; provided, however, that (i) such Transfer of the RFO Common Shares is
consummated on terms not more favorable to the purchasers thereof than the terms specified in the
RFO Notice and (ii) the RFO Offeror provides written confirmation to the RFO Holder that such terms
comply with clause (i) hereof prior to the consummation of such sale; and provided further,
that the Transfer Period shall be extended following such date as necessary to permit all required
approvals, consents or authorizations from, or filings or registrations with, any Governmental
Authority in connection with such Transfers to be obtained or made, to the extent prior to the
expiration of the Transfer Period reasonably appropriate actions have been taken by the RFO Offeror
to obtain such approvals, consents or authorizations or make such filings or registrations. If at
the end of the Transfer Period, as extended as provided in this Section 3.3(e), the RFO Offeror has
not completed the Transfer of the RFO Common Shares, the RFO Offeror shall no longer be permitted
to dispose of such RFO Common Shares without again fully complying with the provisions of this
Section 3.3.




          3.4. Right of First Offer with Respect to Transfers by the JJ Media Shareholder.




          (a) Subject to the lock up obligations under Section 4.1 of the Securities Purchase Agreement,
if the JJ Media Shareholder desires to Transfer any Common Shares from time to time directly or
indirectly held, owned, or Beneficially Owned by it during the JJ Media Shareholder Restrictive
Period, such Transfer shall be permitted only if the JJ Media Shareholder fully complies with any
applicable restrictions on Transfer of Common Shares under the Securities Purchase Agreement and
the terms of this Section 3.4; provided that the provisions of this Section 3.4 shall not apply to
Permitted Transfers.




          (b) The JJ Media Shareholder shall, prior to the Transfer of any Common Shares to which this
Section 3.4 applies, give written notice (“Focus RFO Notice”) to the Focus Shareholder so
long as the Focus Shareholder, together with its Affiliates, owns not less than five percent (5%)
of all of the outstanding Common Shares (counting for such purposes all Common Shares into or for
which the securities of the Company owned by the Focus Shareholder and its Affiliates are directly
or indirectly convertible or exercisable), setting forth (i) the number of






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Common Shares proposed to be Transferred (the “JJ Media RFO Common Shares”), (ii) the
proposed purchase price per JJ Media RFO Common Share, and payment and other material terms and
conditions and (iii) an irrevocable offer to sell to the Focus Shareholder the JJ Media RFO Common
Shares set forth in the Focus RFO Notice at the same price per share and on the same terms and
conditions as set forth therein. For the avoidance of doubt, this Section 3.4 does not prohibit or
restrict in any way the JJ Media Shareholder from discussing, negotiating, or entering into any
discussion or negotiation with any third party for the sale of all or a portion of the Common
Shares held by the JJ Media Shareholder.




          (c) The Focus Shareholder shall have the right to purchase (the “Focus Right of First
Offer”), all, but not a portion, of the JJ Media RFO Common Shares by delivering a written
notice (the “Focus RFO Exercise Notice”) of exercise of the Focus Right of First Offer to
the JJ Media Shareholder, within twenty (20) days from the date of delivery of the Focus RFO Notice
(the “Focus RFO Response Period”), stating therein all, but not a portion, of the JJ Media
RFO Common Shares shall be purchased, collectively, by the Focus Shareholder and/or one or more
wholly-owned Affiliates thereof. A Focus RFO Exercise Notice shall be irrevocable and shall be a
valid and legally binding obligation of the Focus Shareholder to purchase all, but not a portion,
of the JJ Media RFO Common Shares.




          (d) If the Focus Shareholder shall not have completed the purchase of all of the JJ Media RFO
Common Shares within the JJ Media RFO Purchase Period (as defined in Section 3.4(f)), as extended
as provided in Section 3.4(f), or has failed to deliver a Focus RFO Exercise Notice within the
Focus RFO Response Period for all of the JJ Media RFO Common Shares or declined in writing to
exercise the Focus Right of First Offer, or is not entitled to the Focus RFO Notice pursuant to
Section 3.4(b), the JJ Media Shareholder shall promptly give written notice (“Existing
Shareholder RFO Notice”) to the Existing Shareholder so long as the Existing Shareholder,
together with its Affiliates, owns not less than five percent (5%) of all of the outstanding Common
Shares (counting for such purposes all Common Shares into or for which the securities of the
Company owned by the Existing Shareholder and its Affiliates are directly or indirectly convertible
or exercisable), setting forth the same information and offer to the Existing Shareholder as those
set forth in the Focus RFO Notice.




          (e) The Existing Shareholder shall have the right to purchase (the “Existing Shareholder
Right of First Offer”), all, but not a portion, of the JJ Media RFO Common Shares by delivering
a written notice (the “Existing Shareholder RFO Exercise Notice”) of exercise of the
Existing Shareholder Right of First Offer to the JJ Media Shareholder within twenty (20) days from
the date of delivery of the Existing Shareholder RFO Notice (the “Existing Shareholder RFO
Response Period”), stating therein all, but not a portion, of the JJ Media RFO Common Shares
shall be purchased, collectively, by the Existing Shareholder and/or one or more wholly-owned
Affiliates thereof. An Existing Shareholder RFO Exercise Notice shall be irrevocable and shall be
a valid and legally binding obligation of the Existing Shareholder to purchase all, but not a
portion, of the JJ Media RFO Common Shares.




          (f) If the Focus Shareholder or the Existing Shareholder, as the case may be, shall have
delivered a Focus RFO Exercise Notice or an Existing Shareholder RFO Exercise Notice, as the case
may be, to the JJ Media Shareholder within the Focus RFO Response Period or the Existing
Shareholder RFO Response Period, as the case may be, for all the JJ Media RFO






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Common Shares, the JJ Media Shareholder shall be bound to sell all JJ Media RFO Common Shares
to the Focus Shareholder or the Existing Shareholder, as the case may be, within thirty (30) days
thereafter (the “JJ Media RFO Purchase Period”) upon the terms set forth in the Focus RFO
Notice or the Existing Shareholder RFO Notice; provided, however, that such period
shall be extended following such date as necessary to permit all required approvals, consents or
authorizations from, or filings or registrations with, any Governmental Authority in connection
with such purchase to be obtained or made, to the extent prior to the expiration of the JJ Media
RFO Purchase Period reasonably appropriate actions have been taken by the JJ Media Shareholder to
obtain such approvals, consents or authorizations, or make such filings or registrations.




          (g) If the Existing Shareholder shall not have completed the purchase of all of the JJ Media
RFO Common Shares within the JJ Media RFO Purchase Period, as extended as provided in Section
3.4(f), or has failed to deliver an Existing Shareholder RFO Exercise Notice within the Existing
Shareholder RFO Response Period for all of the JJ Media RFO Common Shares or declined in writing to
exercise the Existing Shareholder Right of First Offer, then the JJ Media Shareholder shall have
the right for one hundred eighty (180) days thereafter (the “JJ Media Transfer Period”), to
dispose of the JJ Media RFO Common Shares in one or more Transfers thereof without being subject to
any of the restrictions set forth in this Article III; provided, however, that (i) such
Transfer of the JJ Media RFO Common Shares is consummated on terms not more favorable to the
purchasers thereof than the terms specified in the Focus RFO Notice and the Existing Shareholder
RFO Notice and (ii) the JJ Media Shareholder provides written confirmation to the Focus Shareholder
and the Existing Shareholder that such terms comply with clause (i) hereof prior to the
consummation of such sale; and provided further, that the JJ Media Transfer Period shall be
extended following such date as necessary to permit all required approvals, consents or
authorizations from, or filings or registrations with, any Governmental Authority in connection
with such Transfers to be obtained or made, to the extent prior to the expiration of the JJ Media
Transfer Period reasonably appropriate actions have been taken by the JJ Media Shareholder to
obtain such approvals, consents or authorizations or make such filings or registrations. If at the
end of the JJ Media Transfer Period, as extended as provided in this Section 3.4(g), the JJ Media
Shareholder has not completed the Transfer of the JJ Media RFO Common Shares, the JJ Media
Shareholder shall no longer be permitted to dispose of such JJ Media RFO Common Shares without
again fully complying with the provisions of this Section 3.3.




ARTICLE IV

TERM AND TERMINATION 




          4.1. Term. This Agreement shall take effect immediately upon the Closing and shall
continue in force until the earliest of (i) the date on which the Focus Group Shareholders cease to
own any Common Shares, (ii) with respect to the Existing Shareholder, the date on which the
Existing Shareholder and its Affiliates that becomes a Shareholder in accordance with the terms and
provisions of this Agreement from time to time cease to own any Common Shares (iii) the date this
Agreement is terminated in accordance with the provisions of this ARTICLE IV or (iv) the date this
Agreement is terminated by agreement of all of the Parties in writing; provided that unless
otherwise agreed in writing this Agreement will remain in force with respect






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to any breach or alleged breach of its terms committed during such period. The Parties agree
to make such amendments as are required under the relevant rules of the Exchange.




          4.2. Termination by Focus Shareholder or JJ Media Shareholder. Each of the Focus
Shareholder and the JJ Media Shareholder shall be entitled to terminate this Agreement with respect
to the Existing Shareholder, the Controller of the Existing Shareholder or the Company by notice in
writing if the Existing Shareholder, the Controller of an Existing Shareholder or the Company
becomes a Defaulting Party.




          4.3. Termination by Existing Shareholder, Controller, or the Company. Each of the
Existing Shareholders, the Controllers of the Existing Shareholder and the Company shall be
entitled to terminate this Agreement with respect to the Focus Shareholder or the JJ Media
Shareholder, as the case may be, by notice in writing if the Focus Shareholder or the JJ Media
Shareholder, as the case may be, becomes a Defaulting Party.




          4.4. Defaulting Party. For purposes of this Agreement, a party shall become a
“Defaulting Party” if any of the events set out below shall have occurred:




          (a) the Defaulting Party shall commit a material breach of any of its material obligations
under this Agreement and fail to remedy such breach (if capable of remedy) within 60 days after
such material breach; or




          (b) the Defaulting Party shall go into liquidation whether compulsory or voluntary (except for
the purposes of a bona fide reconstruction or amalgamation) or if a petition shall be presented or
an order made for the appointment of an administrator in relation to the Defaulting Party or if a
receiver, administrative receiver, judicial manager, manager or equivalent officer in any
applicable jurisdiction shall be appointed over any part of the assets or undertaking of the
Defaulting Party and such appointment is not revoked within thirty (30) days from the date of such
appointment or if any event analogous to any of the foregoing shall occur in any jurisdiction; or




          (c) if the Defaulting Party shall make a general assignment or any composition or arrangement
with or for the benefit of its creditors or if a receiver and/or judicial manager, trustee,
administrator or equivalent officer in any applicable jurisdiction is appointed in relation to the
Defaulting Party or in relation to the whole or any material part of its properties or assets.




ARTICLE V

GOVERNING LAW; ARBITRATION 




          5.1. Governing Law. This Agreement and any dispute or claim arising out of or in
connection with it or its subject matter shall be governed by, and construed in accordance with,
the laws of the State of New York without regard to principles of conflicts of laws.




          5.2. Arbitration. Any dispute, controversy or claim arising out of or relating to
this Agreement or its subject matter (including a dispute regarding the existence, validity,
formation, effect, interpretation, performance or termination of this Agreement) (each a
“Dispute”) shall be finally settled by arbitration.







- 14 -









 








          (a) The place of arbitration shall be Hong Kong, and the arbitration shall be administered by
the Hong Kong International Arbitration Centre (the “HKIAC”) in accordance with the United
Nations Commission on International Trade Law then in force (the “UNCITRAL Rules”).




          (b) The arbitration shall be decided by a tribunal of three (3) arbitrators, whose appointment
shall be in accordance with the UNCITRAL Rules.




          (c) Arbitration proceedings (including but not limited to any arbitral award rendered) shall
be in English.




          (d) Subject to the agreement of the tribunal, any Dispute(s) which arise subsequent to the
commencement of arbitration of any existing Dispute(s), shall be resolved by the tribunal already
appointed to hear the existing Dispute(s).




          (e) The award of the arbitration tribunal shall be final and conclusive and binding upon the
parties as from the date rendered.




          (f) Judgment upon any award may be entered and enforced in any court having jurisdiction over
a party or any of its assets. For the purpose of the enforcement of an award, the parties
irrevocably and unconditionally submit to the jurisdiction of any competent court and waive any
defenses to such enforcement based on lack of personal jurisdiction or inconvenient forum.




ARTICLE VI

MISCELLANEOUS 




          6.1. Entire Agreement; Amendments. This Agreement constitutes the entire agreement of
the Parties with respect to the subject matter hereof and may be amended, modified or supplemented
only by a written instrument duly executed by all the Parties hereto.




          6.2. Waiver. Any Party may (a) extend the time for the performance of any of the
obligations or other acts of another Party, (b) waive compliance with any of the agreements of the
another Party or conditions to such Party’s obligations contained herein. Any such extension or
waiver shall be valid only if set forth in an instrument in writing signed by the Party to be bound
thereby. No waiver of any agreement or obligation granted pursuant to this Section 6.2 or
otherwise in accordance with this Agreement shall be construed as a waiver of any prior or
subsequent breach of such agreement or obligation or any other agreement or obligation. The
failure of any Party hereto to assert any of its rights hereunder shall not constitute a waiver of
any of such rights.




          6.3. Assignment. No Party may assign (by operation of law or otherwise) this
Agreement or any of its rights, interests or obligations under this Agreement, in whole or in part,
without the prior written consent of the other Parties, except that assignments of all of the
rights, interests and obligations of the Existing Shareholder or of the Focus Shareholder, as the
case may be, under this Agreement to any transferee of Common Shares in a Transfer pursuant to
Sections 3.2(a) and 3.3 shall be permitted. Except as otherwise expressly provided herein, this






- 15 -









 







Agreement shall be binding upon and inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns.




          6.4. Severability. If any term or other provision of this Agreement is invalid,
illegal or incapable of being enforced by any Law or public policy, all other terms and provisions
of this Agreement shall nevertheless remain in full force and effect for so long as the economic or
legal substance of the transactions contemplated by this Agreement is not affected in any manner
materially adverse to either Party hereto. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the Parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the Parties as closely
as possible in an acceptable manner in order that the transactions contemplated by this Agreement
are consummated as originally contemplated to the greatest extent possible.




          6.5. Remedies. In the event of a breach by any Party to this Agreement of its
obligations under this Agreement, any Party injured by such breach, in addition to being entitled
to exercise all rights granted by Law, including recovery of damages and costs (including
reasonable attorneys’ fees), will be entitled to specific performance of its rights under this
Agreement. The Parties agree that the provisions of this Agreement shall be specifically
enforceable, it being agreed by the parties that the remedy at law, including monetary damages, for
breach of any such provision will be inadequate compensation for any loss and that any defense in
any action for specific performance that a remedy at law would be adequate is waived.




          6.6. Headings. The headings used in this Agreement have been inserted for convenience
of reference only and do not define or limit the provisions hereof.




          6.7. Notices. All notices, requests, claims, demands and other communications
hereunder shall be in writing and shall be deemed duly given, made or received (i) on the date of
delivery if delivered in person or by messenger service, (ii) on the date of confirmation of
receipt of transmission by facsimile (or, the first (1st) Business Day following such receipt if
(a) such date of confirmation is not a Business Day or (b) confirmation of receipt is given after
5:00 p.m., Beijing time) or (iii) on the date of confirmation of receipt if delivered by an
internationally recognized overnight courier service or registered or certified mail (or, the first
(1st) Business Day following such receipt if (a) such date of confirmation is not a Business Day or
(b) confirmation of receipt is given after 5:00 p.m., Beijing time) to the respective Parties
hereto at the following addresses (or at such other address for a party as shall be specified in a
notice given in accordance with this Section 6.7):




          If to the Focus Shareholder:





Focus Media Holding Limited

28F, No. 369, Zhaofeng World Trade Tower

Jiangsu Road, Shanghai

PRC 200050

Attn:

Facsimile:



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          with a copy (which shall not constitute notice) to:





Simpson Thacher & Bartlett LLP

3119 China World Office 1

1 Jianguomenwai Avenue

Beijing, China 100004

Attn: Douglas Markel, Esq.

Facsimile: (86-10) 5965-2988



          If to the JJ Media Shareholder:





JJ Media Investment Holding Limited

c/o Focus Media Holding Limited

28F, No. 369, Zhaofeng World Trade Tower

Jiangsu Road, Shanghai

PRC 200050

Attn: Jason Nanchun Jiang

Facsimile:



          If to the Existing Shareholder:





VisionChina Media Inc.

1/F Block No.6 Champs Elysees

Nongyuan Road, Futian District

Shenzhen 518040

The People’s Republic of China

Attn: Yingming Lei

Email: leiyingming@visionchina.cn

Facsimile: +86 755 8317-1111If to Limin Li:



          If to the Company:





VisionChina Media Inc.

1/F Block No.7 Champs Elysees

Nongyuan Road, Futian District

Shenzhen 518040

The People’s Republic of China

Attn: Minghua Zhou

Email: minghua.zhou@visionchina.cn

Facsimile: +86 755 8298-1111



          with copy (which shall not constitute notice) to:





Skadden, Arps, Slate, Meagher & Flom

42/F, Edinburgh Tower, The Landmark

15 Queen’s Road Central, Hong Kong

Attn: Julie Gao, Esq.

Facsimile: +(852) 39104850



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          6.8. Further Assurances. Each Party shall cooperate and shall take such further
action and shall execute and deliver such further documents as may be reasonably requested by any
other Party in order to carry out the provisions and purposes of this Agreement.




          6.9. Counterparts. This Agreement may be executed and delivered (including by
facsimile transmission) in one or more counterparts, and by the different parties hereto in
separate counterparts, each of which when executed shall be deemed to be an original, but all of
which taken together shall constitute one and the same agreement.




[Signatures Begin On Next Page]




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          IN WITNESS WHEREOF, the Parties hereto have executed and delivered this Agreement as of the
date first above written.




	 	 	 	 	 
	 	FOCUS MEDIA HOLDING LIMITED

 	 
	 	By:  	/s/ Jason Nanchun Jiang 	 
	 	 	Name:  	Jason Nanchun Jiang 	 
	 	 	Title:  	Chief Executive Officer 	 
	 
	 	JJ MEDIA INVESTMENT HOLDING
LIMITED

 	 
	 	By:  	/s/ Jason Nanchun Jiang 	 
	 	 	Name:  	Jason Nanchun Jiang 	 
	 	 	Title:  	Director 	 
	 
	 	FRONT LEAD INVESTMENTS LIMITED

 	 
	 	By:  	/s/ Limin Li 	 
	 	 	Name:  	Limin Li 	 
	 	 	Title:  	 	 
	 
	 	LIMIN LI

 	 
	 	By:  	/s/ Limin Li 	 
	 	 	 	 
	 
	 	VISIONCHINA MEDIA INC.

 	 
	 	By:  	/s/ Limin Li 	 
	 	 	Name:  	Limin Li 	 
	 	 	Title:  	Chief Executive Officer