YOU On Demand Holdings, Inc. : Exhibit 10.2 - Filed by newsfilecorp.com






________________________________________________

Call Option Agreement 

________________________________________________

by and between 

YOU On Demand (Beijing) Technology Co., Ltd. 

and 

Yang Lan 

and 

Zhu Yun 

and 

Tianjin Sevenstarflix Network Technology Limited 

 

April 5, 2016




TABLE OF CONTENTS 

	Article 	  	Page 
	1.
      	DEFINITIONS
      AND INTERPRETATIONS 	1
      
	2.
      	OPTION
      	2
      
	3.
      	UNDERTAKINGS
      	3
      
	4.
      	REPRESENTATIONS
      AND WARRANTIES 	5
      
	5.
      	TERM
      	6
      
	6.
      	BREACH
      OF CONTRACT 	6
      
	7.
      	CONFIDENTIALITY
      	6
      
	8.
      	FORCE
      MAJEURE 	7
      
	9.
      	GOVERNING
      LAW 	8
      
	10.
      	DISPUTE
      RESOLUTION 	8
      
	11.
      	MISCELLANEOUS
      	8
      






This CALL OPTION AGREEMENT (“Agreement”) is
entered into on this 5th day of April, 2016 in Beijing, People’s Republic of
China (“PRC”), by and between:

	(1) 	
      YOU On Demand (Beijing) Technology Co., Ltd., a
      limited liability company incorporated under the laws of the PRC, with its
      registered address at Suite 2603, 26/F, Tower A, 10 Jintongxi Road,
      Chaoyang District, Beijing, PRC (“Party A”);

	 	 
	(2) 	
      Yang Lan, a PRC citizen and holder of identity card
      number 110108196803315727 (“Party B”);

	 	 
	(3) 	
      Zhu Yun, a PRC citizen and holder of identity card number
      630104197402260543 (“Party C”); and

	 	 
	(4) 	
      Tianjin Sevenstarflix Network Technology Limited,
      a limited liability company incorporated under the laws of the PRC, with
      its registered address at Suite 305-55, 3/F, Zonghe Service Building D,
      Nangang Industrial Zone of Tianjin Economic Development Zone, Tianjin, PRC
      (“Company”).



WHEREAS: 

	A. 	
      The Company is engaged in certain business activities in
      the PRC (“Business”). Party A has the expertise in consulting, and
      Party A and the Company have entered into a Technical Services Agreement
      dated as of 1 April 2016 to provide the Company with various technical,
      marketing and management consulting and other services in connection with
      the Business.

	 	 
	B. 	
      Party B holds 99% and Party C holds 1% of the equity
      interests of the Company (collectively, “Equity Interests”). The
      Equity Interests represent RMB 50 million in the registered capital of the
      Company.

	 	 
	C. 	
      Party B and Party C wish to grant Party A the option to
      purchase the entire Equity Interests, and Party A is willing to accept
      such option, in accordance with the terms and conditions set out
    below.



NOW THEREFORE, the parties agree as follows: 

	1. 	
      DEFINITIONS AND
INTERPRETATIONS




	 	1.1 	
      Definitions. Unless otherwise provided in this
      Agreement, the following terms shall have the meanings set forth
    below:




		Business Day 	
      means a day on which commercial banks are open for
      business in the PRC; 

	 	  	
       

		Call Notice 	
      means the written notice sent by Party A to exercise the
      Option; 




	Call Option Agreement
    	- 1 -
    	 







		Confidential Information 	
      means any information of a confidential nature relating
      to the parties and the Company, including without limitation any
      confidential information concerning their respective structure, business
      activities (including financial information, client lists and business
      policies), technology, released or unreleased software or hardware
      products, and marketing plans, regardless of the format in which such
      information is stored or communicated, and including any excerpts,
      summaries or other derivative forms of the same; 

	 	  	
       

		Designated Person 	
      means any person designated by Party A in writing;
  

	 	  	
       

		Equity Pledge Agreement 	
      means the Equity Pledge Agreement entered into between
      Party A, Party B and Party C on 1 April 2016; 

	 	  	
       

		Force Majeure 	
      means any fire, flood, war, act of government or other
      natural or man-made event which is unforeseen by the parties (or if
      foreseen, reasonably unavoidable) and which prevents the performance of
      this Agreement by any or all of the parties, but excluding any shortage of
      credit; 

	 	  	
       

		Option 	
      means the option for Party A or any Designated Person to
      purchase, at any time, all or part of the Equity Interests; and 

	 	  	
       

		Security Interest 	
      means any security, right or interest of a third party,
      any purchase right, right of acquisition, right of set-off, or other
      security arrangement, including any security interest subject to this
      Agreement or the Equity Pledge Agreement. 




	 	1.2 	
      Interpretation. All headings used herein are for
      reference purposes only and shall not affect the meaning or interpretation
      of any provision. Any reference to an Article or Appendix is to an article
      or appendix of this Agreement. For purposes of this Agreement, the term
      “PRC” refers to Mainland China, and unless explicitly provided herein does
      not refer to the Special Administrative Regions of Hong Kong and Macao or
      the territory of Taiwan. References to the masculine shall include the
      feminine and vice versa.





	Call Option Agreement
    	- 2  -
    	 






	2. 	
      OPTION




	 	2.1 	
      Grant of Option. Each of Party B and Party C
      hereby irrevocably grants to Party A the Option to acquire his share of
      the Equity Interests in accordance with this Agreement.

	 	 	 
	 	2.2 	
      Procedures. Upon Party A’s decision to exercise
      the Option, it shall send a Call Notice to Party B and Party C setting
      out: (a) the Equity Interests amount Party A wishes to acquire; (b)
      details of the corresponding exercise price; and (c) whether the Equity
      Interests being purchased will be transferred to Party A or to a
      Designated Person.

	 	 	 
	 	2.3 	
      Exercise Price. The exercise price for the Equity
      Interests acquired by Party A or its Designated Person hereunder shall be
      determined by Party A at its discretion, subject to any restrictions
      imposed by PRC law.

	 	 	 
	 	2.4 	
      Exercise of Option Right. Each time that Party A
      exercises the Option Party B and Party C
shall:




	 	2.4.1 	
      convene a shareholders meeting, and pass the necessary
      resolutions to transfer the relevant portion of the Equity Interests to
      Party A or the relevant Designated Person; and

	 	 	 
	 	2.4.2 	
      cause the Company and its directors to, and shall
      themselves, take all action necessary to effect the Option, including
      without limitation executing all documents, obtaining all approvals and
      performing all required steps to transfer the valid ownership of the
      Equity Interests to Party A or the Designated
Person.




	3. 	
      UNDERTAKINGS




	 	3.1 	
      Undertakings of Party B and Party C in Regard to the
      Company. Each of Party B and Party C undertakes to vote in accordance
      with its Equity Interests in the Company and to take all other necessary
      action to ensure that the Company:




	 	3.1.1 	
      does not supplement or modify its articles of association
      or other constituent documents, increase or decrease its existing
      registered capital, change its business activities, or alter its capital
      structure, without the prior written consent of Party A;

	 	 	 
	 	3.1.2 	
      manages its business and handles its financial and
      commercial affairs prudently and in accordance with relevant laws and
      codes of practice;

	 	 	 
	 	3.1.3 	
      does not sell, assign, mortgage, or otherwise dispose of
      any legal or beneficial rights to or in any of its assets, business, or
      revenue, or permit the creation of any Security Interest at any time,
  without the prior written consent of Party A; 




	Call Option Agreement
    	- 3  -
    	 








	 	3.1.4 	
      does not incur, assume or guarantee any debts, without
      the prior written consent of Party A;

	 	 	 
	 	3.1.5 	
      does not enter into any material contract valued in
      excess of RMB 10,000 without the prior written consent of Party A, except
      in the ordinary course of business;

	 	 	 
	 	3.1.6 	
      does not, under any circumstance, enter into any contract
      valued in excess of RMB 200,000 without the prior written consent of Party
      A;

	 	 	 
	 	3.1.7 	
      does not extend any loan or credit to any party, or
      provide any guarantee or assume any obligation of any party, without the
      prior written consent of Party A;

	 	 	 
	 	3.1.8	
      provides all information relating to its operations and
      financial affairs to Party A upon Party A’s request;

	 	 	 
	 	3.1.9	
      does not merge or consolidate with any third party or
      acquire or invest in any third party, without the prior written consent of
      Party A;

	 	 	 
	 	3.1.0	
      notifies Party A immediately should any legal action,
      arbitration or administrative procedure relating to its assets, operations
      or income arise or become likely to arise;

	 	 	 
	 	3.1.11 	
      promptly executes all documents and takes all other
      actions which are reasonably necessary for the lawful performance of the
      provisions and aim of this Agreement and the documents beneficial to this
      Agreement;

	 	 	 
	 	3.1.12	
      does not pay dividends or distributions of any kind to
      its shareholders without the prior written consent of Party
  A.




	 	3.2 	
      Personal Undertakings of Party B and Party C.
      Party B and Party C each further undertakes
to:




	 	3.2.1 	
      cause a shareholders meeting of the Company to vote in
      favor of the transfer of his share of the Equity Interests as contemplated
      hereunder, at the request of Party A;

	 	 	 
	 	3.2.2 	
      promptly execute all documents and take all other actions
      which are reasonably necessary for the lawful performance of the
      provisions and objective of this Agreement and the documents beneficial to
      this Agreement;




	Call Option Agreement
    	- 4  -
    	 







	 	3.2.3 	
      appoint only persons nominated by Party A to serve as
      directors of the Company; and

	 	 	 
	 	3.2.4 	
      strictly comply with and perform the provisions of this
      Agreement and any other contracts entered into jointly or separately by
      the parties, and further undertakes and represents that he will not do
      anything which will affect the validity and enforceability of such
      contracts.




	4. 	
      REPRESENTATIONS AND
WARRANTIES




	 	4.1 	
      Party B and Party C. Each of Party B and Party C
      hereby represents and warrants to Party A that, as of the date of this
      Agreement:




	 	4.1.1 	
      he has the legal capacity to enter into and perform this
      Agreement;

	 	 	 
	 	4.1.2 	
      his execution and performance of this Agreement will not
      result in a breach of any law, regulation, authorisation or agreement to
      which he is subject;

	 	 	 
	 	4.1.3 	
      this Agreement constitutes legal, valid, and binding
      obligations enforceable against him;

	 	 	 
	 	4.1.4 	
      he is the lawful owner of his share of the Equity
      Interests and has not created any Security Interest over such Equity
      Interests other than under the Equity Pledge Agreement; and

	 	 	 
	 	4.1.5 	
      there is no ongoing or pending dispute, action,
      arbitration, administrative procedure or other legal proceeding against
      him.




	 	4.2 	
      Company. The Company represents and warrants to
      Party A that, as of the date of this
Agreement:




	 	4.2.1 	
      it is a company incorporated and validly existing under
      the laws of the PRC;

	 	 	 
	 	4.2.2 	
      it has all due power and authority to enter into and
      perform this Agreement;

	 	 	 
	 	4.2.3 	
      its execution and performance of this Agreement will not
      result in a breach of any law, regulation, authorization or agreement to
      which it is subject;

	 	 	 
	 	4.2.4 	
      it is the lawful owner of its assets, and has not created
      any Security Interest over such assets;




	Call Option Agreement
    	- 5  -
    	 







	 	4.2.5 	
      it does not have any outstanding debts other than those
      incurred in the ordinary course of business and which have been disclosed
      to Party A; and

	 	 	 
	 	4.2.6 	
      there is no ongoing or pending dispute, action,
      arbitration, administrative procedure or other legal proceeding relating
      to the Equity Interests, its assets or itself.




	5. 	
      TERM



This Agreement will take effect on the
date first set out above, and shall continue with full force and effect until
the earlier of the date on which: 

	 	5.1 	
      Party A has acquired the entire Equity Interests;
    and

	 	 	 
	 	5.2 	
      this Agreement is terminated by the mutual written
      consent of the parties.




	6. 	
      BREACH OF CONTRACT




	 	6.1 	
      Breach. A party shall be deemed to be in breach of
      this Agreement if:




	 	6.1.1 	
      he fails to perform its obligations under this Agreement
      fully and in a timely manner, and does not rectify any such failure within
      30 days after written demand from any other party requesting the same;
      or

	 	 	 
	 	6.1.2 	
      any representation or warranty made by such party
      hereunder proves to be or becomes materially false, misleading or
      untrue.




	 	6.2 	
      Liability for Breach. Any party that breaches this
      Agreement shall indemnify the other parties against, and compensate them
      for, any damages or loss incurred as a result, including third party
      claims.




	7. 	
      CONFIDENTIALITY




	 	7.1 	
      Confidentiality Obligations. Each party
      (“Receiving Party”) shall maintain the strict confidentiality of
      any and all Confidential Information of any other party (“Disclosing
      Party”) to which it may become privy before or during the performance
      of this Agreement, and shall not disclose any such Confidential
      Information to any third party except to its relevant employees, officers,
      affiliates and advisors (as applicable) on a “need-to-know” basis and
      provided that the aforesaid recipients of Confidential Information are
      subject to written confidentiality undertakings which are no less strict
      than the obligations set out herein. Any Confidential Information of the
      Disclosing Party which is received by the Receiving Party hereunder shall
      be used for the sole purpose of performing this Agreement and such other
  purpose as the Disclosing Party shall have permitted in writing. 




	Call Option Agreement
    	- 6  -
    	 








	 	7.2 	
      Exceptions. The disclosure of Confidential
      Information by the Receiving Party shall not be deemed a breach of its
      confidentiality obligations under the following
  circumstances;




	 	7.2.1 	
      the Disclosing Party has given its prior written consent
      to the disclosure;

	 	 	 
	 	7.2.2 	
      the Confidential Information has entered the public
      domain through no fault or wrongful act of the Receiving Party;

	 	 	 
	 	7.2.3 	
      the Confidential Information has been rightfully received
      by the Receiving Party from a third party which developed such information
      independently and was not subject to any confidentiality obligation with
      regard to the same;

	 	 	 
	 	7.2.4 	
      the Confidential Information was, prior to this Agreement
      or any other separate non-disclosure agreement previously existing between
      the parties and independently developed by the Receiving Party without the
      use, directly or indirectly, of the Confidential Information; or

	 	 	 
	 	7.2.5 	
      where the disclosure of Confidential Information is
      required pursuant to law or a court order of competent jurisdiction,
      provided that such disclosure shall be limited to the extent required by
      such applicable law or court order, and provided further that the
      Receiving Party has notified the Disclosing Party of the need to disclose
      the Confidential Information in question, such that the Disclosing Party
      shall have the opportunity to oppose the disclosure thereof by means of
      any available objections or appeals.




	8. 	
      FORCE MAJEURE




	 	8.1 	
      A party who is not able to perform its obligations
      hereunder as a direct result of Force Majeure, shall not be deemed to be
      in breach of this Agreement, provided that the following conditions are
      satisfied simultaneously:




	 	8.1.1 	
      its failure to perform its obligations hereunder has been
      directly caused by Force Majeure;

	 	 	 
	 	8.1.2 	
      it has used commercially reasonable efforts to perform
      its obligations hereunder and, has taken necessary precautions to reduce
      the losses to the other parties arising from the Force Majeure;

	 	 	 
	 	8.1.3 	
      it has immediately informed the other parties in writing
  after the occurrence of Force Majeure; and




	Call Option Agreement
    	- 7  -
    	 








	 	8.1.4 	
      it has provided written information and supporting
      documentation, including a statement of the reasons for the delay in
      implementing or partially implementing this Agreement, within 15 days
      after the occurrence of Force Majeure.




	9. 	
      GOVERNING LAW



This Agreement shall be governed by and
construed in accordance with the laws of the PRC. 

	10. 	
      DISPUTE RESOLUTION




	 	10.1 	
      If any dispute arises in connection with this Agreement,
      the parties shall attempt in the first instance to resolve it through
      friendly consultations or mediation. If any dispute cannot be resolved
      within thirty (30) days after the commencement of discussions, such
      dispute shall be referred to and finally resolved by arbitration in
      Beijing under the auspices of the China International Economic and Trade
      Arbitration Commission in accordance with the Commission’s then-current
      arbitration rules. The arbitration shall be conducted in [both the English
      and Chinese] languages before a tribunal of three (3) arbitrators
      appointed in accordance with the said rules.

	 	 	 
	 	10.2 	
      The arbitral award shall be final and binding on the
      parties. The winning party may, at the cost and expense of the losing
      party(ies), apply to any court of competent jurisdiction for enforcement
      of such arbitral award.

	 	 	 
	 	10.3 	
      During the period when the dispute is being resolved,
      except for the matters under dispute, the parties shall continue
      performing this Agreement in all respects.




	11. 	
      MISCELLANEOUS




	 	11.1 	
      Notices. All notices or other communications
      hereunder shall be written in English, and delivered in person (including
      by courier), by first class mail or facsimile, to the addresses set forth
      below. A notice shall be deemed to have been delivered (a) on the date of
      signing of the delivery receipt in the case of delivery in person
      (including by courier); (b) on the 10th day of the mailing date
      in the case of delivery by mail; and (c) on the date recorded in the
      transmission record in the case of facsimile, unless delivery is made
      after 5 pm on a Business Day or on a non-Business Day in the place of
      receipt, in which case delivery shall be deemed to occur at 9 am on the
      following Business Day.




	Call Option Agreement
    	- 8  -
    	 







	 	Party A: 	YOU On Demand (Beijing) Technology Co.,
      Ltd. 
	 	 	 
	 	Address: 	Suite 2603, 26/F, Tower A, 10 Jintongxi Road,
    
	 		Chaoyang District, Beijing,
  PRC  
	 	Tel: 	+86 10 8590 6561 
	 	Fax: 	+86 10 8590 6577 
	 	Attn: 	Grace He 
	 	  	  
	 	Party B: 	Yang Lan 
	 	  	  
	 	Address: 	No. 602 Unit 1 18/F, No. 19 West Third Ring
      North 
	 	  	Road, Haidian District, Beijing, PRC 
	 	Tel: 	+86 10 8776 2856 
	 	  	  
	 	Party C: 	Zhu Yun 
	 	Address: 	No.501, Room 13, 15th Floor, Liuheyuan, 
	 	  	Shijingshan District, Beijing, PRC. 
	 	Tel: 	+86 138 0111 9910 
	 	  	  
		Company: 	Tianjin Sevenstarflix Network Technology
      Limited 
	 	  	  
	 	Address: 	Suite 305-55, 3/F, Zonghe Service Building D,
    
	 	  	Nangang Industrial Zone of Tianjin Economic
  
	 		Development Zone, Tianjin,
PRC  
	 	Tel: 	+86 10 8590 6561 
	 	Fax: 	+86 10 8590 6577 
	 	Attn: 	Mei Chen 



	 	11.2 	
      Entire Agreement. This Agreement constitutes the
      entire agreement among the parties in respect of the subject matter hereof
      and shall supersede any previous discussions, negotiations and agreements
      related thereto.

	 	 	 
	 	11.3 	
      Amendment. This Agreement may be amended only by a
      written agreement signed by the parties, which amendment shall be attached
      to this Agreement as an Appendix. If required by law, the parties shall
      obtain all requisite approvals from the relevant authorities to give
      effect to the amendment.

	 	 	 
	 	11.4 	
      No Waiver. Unless otherwise agreed upon by the
      parties in writing, any failure or delay on the part of any party to
      exercise any right, authority or privilege under this Agreement, or under
      any other related agreement, shall not operate as a waiver thereof; nor
      shall any single or partial exercise of any right, authority or privilege
      preclude any other future exercise thereof.

	 	 	 
	 	11.5 	
      Severability. The provisions of this Agreement are
      severable from each other. The invalidity of any provision of this
      Agreement shall not affect the validity or enforceability of any other
      provision of this Agreement.




	Call Option Agreement
    	- 9  -
    	 







	 	11.6 	
      Successors. This Agreement shall be valid and
      binding on the parties, their successors and permitted assigns (if
      any).

	 	 	 
	 	11.7 	
      Assignment. Party B, Party C and the Company shall
      not assign any of their rights or obligations hereunder without the prior
      written consent of Party A. Party A shall have the right to assign all or
      any of its rights or obligations under this Agreement to a Designated
      Person at any time. Party B, Party C and the Company shall cooperate fully
      with Party A to affect any such assignment, including without limitation
      signing any documentation.

	 	 	 
	 	11.8 	
      Counterparts. This Agreement may be executed in
      any number of counterparts. Each such counterpart shall be deemed to be an
      original instrument, and all such counterparts shall together constitute
      one and the same instrument.

	 	 	 
	 	11.9 	
      Languages and Versions. This Agreement is executed
      in four (4) original English language sets. Each party shall retain one
      (1) such original set.



[The space below is intentionally left blank.] 

	Call Option Agreement
    	- 10  -
    	 






IN WITNESS WHEREOF, the parties have executed or have
caused this Agreement to be executed by their duly authorized representatives on
the date first indicated above. 

For and on behalf of
YOU On Demand (Beijing)
Technology Co., Ltd. 
(Company Seal) 


	Signature: 	/s/
      Wang Pao Yun 
	Name: 	Wang Pao Yun 
	Title: 	Legal Representative






	Yang Lan 	 
	 	 
	Signature: 	/s/
      Yang Lan
	 	 
	Zhu Yun 	 
	 	 
	Signature: 	/s/
      Zhu Yun



For and on behalf of 
Tianjin Sevenstarflix
Network Technology Limited
(Company Seal) 


	Signature: 	/s/
      Zhu Yun
	Name: 	Zhu Yun 
	Title: 	Legal Representative





	Signature Page to
      Call Option Agreement