EX-10.38 49 h00745exv10w38.txt EX-10.38 SHARE PURCHASE AGREEMENT EXHIBIT 10.38 EXECUTION COPY XINHUA FINANCE MEDIA LIMITED [Chinese Characters] (the Purchaser) AND CHEUNG WAH KEUNG AND OTHERS (the Vendors) ---------- SHARE PURCHASE AGREEMENT IN RESPECT OF SHARES IN THE CAPITAL OF ECONWORLD MEDIA LIMITED ---------- 8 JUNE 2006 Hong Kong THIS SALE AND PURCHASE AGREEMENT (this "AGREEMENT") is made on the 8th day of June 2006. BETWEEN 1. XINHUA FINANCE MEDIA LIMITED [Chinese Characters], a company incorporated under the laws of the Cayman Islands with registration number 157511 and a registered address at Century Yard, Cricket Square, Hutchins Drive, P.O. Box 2681GT, George Town, Grand Cayman, Cayman Islands, British West Indies (the "PURCHASER"); 2. The persons or corporations whose names are set out in Schedule I (each a "VENDOR" and together the "VENDORS"). WHEREAS A. The Vendors hold 65,000 shares of EconWorld Media Limited (the "COMPANY"), which represents approximately 18.57% of the issued and outstanding share capital of the Company, a company incorporated in Hong Kong with a registration number of 696257 and a registered address of Room 203A, 2/F., Stanhope House, 734-738 King's Road, Hong Kong. Further corporate particulars of the Company are set out in Schedule II. B. By a subscription agreement dated 26 May 2005 and a supplemental deed dated 2 November 2005 entered into between Xinhua Finance Limited ("XFL") and the Vendors, the Vendors have the put option to sell the Sale Shares and XFL has the call option to purchase the Sale Shares in accordance with the terms of the subscription agreement and supplemental deed. C. On 12 January 2006, XFL transferred all its shares in the Company to the Purchaser. D. The Purchaser desires to purchase from the Vendors and the Vendors wish to sell to the Purchaser 42,000 shares of the Company (the "SALE SHARES"), representing 12% of the issued and outstanding share capital of the Company subject to the terms and conditions set out in this Agreement. NOW, THEREFORE, in consideration of the premises and the mutual covenants set forth herein, the Purchaser and the Vendors do hereby agree as follows: 1. DEFINITIONS 1.1 Definitions. The following terms, as used herein, have the following meanings: "BOARD" means the board of directors of the Company; "CLOSING" shall have the meaning provided in Clause 2.3; 2 "CLOSING DATE" shall have the meaning provided in Clause 2.3; "CONSENT" means any consent, approval, permit, license, order, or authorization of or registration, declaration, or filing with or exemption by Governmental Entity; "DIRECTORS" mean the members from time to time of the Board; "ENCUMBRANCE" means and includes any interest or equity of any person (including, without prejudice to the generality of the foregoing, any right to acquire, option or right of pre-emption) or any mortgage, charge, pledge, lien or assignment or any other encumbrance, priority or security interest or arrangement of whatsoever nature over or in the relevant property; "GOVERNMENTAL ENTITY" means any court, regulatory body, administrative agency or commission or other governmental authority or instrumentality, whether domestic or foreign; "HONG KONG" means the Hong Kong Special Administrative Region of the People's Republic of China; "PURCHASE PRICE" means US$1,082,910; "SALE SHARES" has the meaning set out in Recital D; and "US$" and "US DOLLARS" means the lawful currency of the United States of America. 1.2 Interpretation. In this Agreement: (a) the headings are inserted for convenience only and shall not affect the construction of this Agreement; (b) references to statutory provisions shall be construed as references to those provisions as amended or re-enacted or as their application is modified by other statutory provisions (whether before or after the date hereof) from time to time and shall include any provisions of which they are re-enactments (whether with or without modification); (c) all time and dates in this Agreement shall be Hong Kong time and dates except where otherwise stated; (d) unless the context requires otherwise, words incorporating the singular shall include the plural and vice versa and words importing a gender shall include every gender; and (e) references herein to Clauses, Recitals and Schedules are to clauses and recitals of and schedules to this Agreement. 1.3 Recitals, Schedules. All Recitals and Schedules form part of this Agreement and shall have the same force and effect as if expressly set out in the body of this Agreement and any reference to this Agreement shall include the Recitals and Schedules. 3 2 SALE AND PURCHASE OF SALE SHARES 2.1 Sale. Subject to the terms and conditions set out in this Agreement, the Purchaser (relying on the representations, warranties, agreements, covenants, undertakings and indemnities hereinafter referred to) agrees with the Vendors to purchase at Closing, and the Vendors agree to sell and cause to be sold to the Purchaser at Closing, all rights, title and interests in the Sale Shares free from all Encumbrances together with all rights of any nature whatsoever now or hereafter attaching or accruing to them including all rights to any dividends or other distribution declared paid or made in respect of them after the Closing Date. 2.2 Purchase Price. The aggregate purchase price for the interests in the Sale Shares shall be US$1,082,910 (the "PURCHASE PRICE"). 2.3 Closing. The purchase and sale of the Sale Shares (the "CLOSING") shall take place at the offices of Suite 2003-5, Vicwood Plaza, 199 Des Voeux Road Central, Hong Kong on 8 June 2006 or at such other time and place as the Purchaser and the Vendors agree in writing. The date and time of the Closing are herein referred to as the "CLOSING DATE". 2.4 The Vendors' Closing Obligations. Upon Closing the Vendors shall deliver to the Purchaser: (i) the following documents in respect of the Sale Shares: (A) duly completed and signed instruments of transfers and sold notes of the Sale Shares by the registered holders thereof in favour of the Purchaser or as it may direct together with the share certificates representing the Sale Shares; (B) all powers of attorney or other authorities under which the transfers of the Sale Shares have been executed; (C) such waivers or consents as the Purchaser may require enabling the Purchaser or its nominee(s) to be registered as the holders of the Sale Shares; (D) such other documents as may be required to give to the Purchaser good title to the Sale Shares and to enable the Purchaser or its nominees to become the registered holders thereof; (ii) written confirmation that the Vendors are not aware of any matter or thing which is in breach of or inconsistent with any of the representations, warranties and undertakings herein contained; and (iii) such other papers and documents as the Purchaser may reasonably require. 4 2.5 The Purchaser's Closing Obligations. Against performance of the the matters set out in Clause 2.4, the Purchaser shall pay to the Vendors the Purchase Price. 2.6 Further Covenants. The Vendors hereby irrevocably undertake to the Purhcaser to procure at its own expense the due execution of all such further documents as are necessary to vest in the Purchaser all such property and rights as are intended to be vested in them by or pursuant to this Agreement. 3. REPRESENTATIONS, WARRANTIES AND COVENANTS The Vendors represent and warrant to the Purchaser that the following statements are true and correct as of the date of this Agreement: 3.1 The Company. In respect of the Company: (a) Organization, Standing, and Power. It is a company duly organized, validly existing, and in good standing under the laws of incorporation, has all requisite corporate power and authority to carry on its businesses, and is duly qualified and in good standing to do business in each jurisdiction in which it conducts business. The articles of incorporation, bylaws, registers and/or other organizational documents ("CHARTER DOCUMENTS") of the Company, in each case, as amended to the date hereof are complete and correct copies. (b) Corporate Records. Its minute books and corporate records contain correct and complete records of all proceedings and actions taken at all meetings of, or effected by written consent of, its shareholders and its board of directors, and all original issuances and subsequent transfers, repurchases, and cancellations of its shares. (c) Capital Structure. (i) Immediately following Closing its issued share capital will be as set out in Schedule III. (ii) There are no options, warrants, calls, conversion rights, commitments, agreements, contracts, restrictions, or rights of any character to which its is a party or by which it may be bound obligating company to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares, or obligating it to grant, extend or enter into any such option, warrant, call, conversion right, commitment, agreement, contract, understanding, restriction, arrangement or right. It does not have outstanding any bonds, debentures, notes or other indebtedness. (d) Authority. The execution, delivery, and performance of this Agreement has been duly authorized by all necessary action of its board. Certified copies of the resolutions adopted by its board approving this Agreement and transactions contemplated hereby have been provided to the Purchaser. (e) Execution. It has duly and validly executed and delivered this Agreement 5 constitute valid, binding, and enforceable obligations of it in accordance with their terms, except to the extent that enforceability may be limited by applicable bankruptcy, reorganization, insolvency, moratorium or other laws affecting the enforcement of creditors' rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding at law or in equity. (f) Compliance with Laws and Other Instruments. It holds, and at all times has held all licenses, permits, and authorizations from all governmental entities necessary for the lawful conduct of its business pursuant to all applicable statutes, laws, ordinances, rules, and regulations of all such authorities having jurisdiction over it or any part of its operations. There are no violations or claimed violations of any such license, permit, or authorization, or any such statute, law, ordinance, rule or regulation. (g) Corporate Governance. Neither the execution and delivery of this Agreement nor the performance by it of its obligations under this Agreement will (i) conflict with or result in any breach of its Charter Documents; (ii) require any Consent, (iii) conflict with, result in a breach or default of, or give rise to any right of termination, cancellation or acceleration or result in the creation of any lien, charge, encumbrance, or restriction upon any of the properties or assets of it or its shares under, any law, statute, rule, regulation, judgment, decree, order, government permit, license or order or any mortgage, indenture, note, license, trust, agreement or other agreement, instrument or obligation to which it is a party. (h) No Litigation. The Company is not involved in any litigation whether as plaintiff or defendant. (i) Ownership of Shares. Each Vendor has good and valid title to the Sale Shares set forth opposite his or its name on Schedule I, free and clear of any lien, charge, encumbrance, security interest, voting agreement, voting trust, voting or transfer restriction, right of first refusal, proxy, claim or right of others of whatever nature (a "LIEN"), and at closing of any sale of such Sale Shares by a Vendor, such Vendor will deliver to the Purchaser good and valid title to all of the Sale Shares beneficially owned by such Vendor as set forth on Schedule I hereto, free and clear of any Liens. No person or entity other than such Vendor has any power or right, whether or not shared with any other person or entity, to dispose of or direct the disposition of any of the Sale Shares or to vote or direct the voting of any of the Sale Shares held by such Vendor as set forth on Schedule I hereto. 3.2 General (a) Full Disclosure. (i) The Vendors are not aware of any facts which could materially adversely affect the Company or which are likely in the future to materially adversely affect the Company and which have not been disclosed by or on behalf of the Company in connection with or pursuant to this Agreement. (ii) No representation or warranty in this Agreement, nor any statement or certificate furnished or to be furnished to the Purchaser pursuant 6 to or in connection with this Agreement contains or will contain any untrue statement of material fact, or omits or will omit to state a material fact necessary to make the statements contained herein or therein not misleading. (b) Reliance. The foregoing representations and warranties are made by the Vendors with the knowledge and expectation that the Purchaser is placing reliance thereon. 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE VENDORS The Vendors hereby represent, warrant and covenant on a joint and several basis to the Purchaser that each of the following statements is true: 4.1 Organisation and Qualification. It is a person or a legal entity duly organised and validly existing under the laws of its jurisdiction of incorporation. 4.2 Authorisation. It has taken all corporate or other action required to authorise, and has duly authorised, the execution, delivery and performance of this Agreement and upon due execution and delivery the same will constitute its legal, valid and binding obligations enforceable in accordance with its terms. 4.3 Power and Authority. It has full power and authority to make the covenants and representations referred to herein and to sale the Sale Shares and to execute, deliver and perform this Agreement. 4.4 Authority. The execution, delivery, and performance of this Agreement has been duly authorized by all necessary action of its board. Certified copies of the resolutions adopted by its board approving this Agreement and transactions contemplated hereby have been provided to the Purchaser. 4.5 Compliance with Laws and Other Instruments. It holds, and at all times has held all licenses, permits, and authorizations from all governmental entities necessary for the lawful conduct of its business pursuant to all applicable statutes, laws, ordinances, rules, and regulations of all such authorities having jurisdiction over it or any part of its operations. There are no violations or claimed violations of any such license, permit, or authorization, or any such statute, law, ordinance, rule or regulation. 4.6 Corporate Governance. Neither the execution and delivery of this Agreement nor the performance by it of its obligations under this Agreement will (i) conflict with or result in any breach of its Charter Documents (ii) require any Consents by Governmental Entity, (iii) conflict with, result in a breach or default of, or give rise to any right of termination, cancellation or acceleration or result in the creation of any lien, charge, encumbrance, or restriction upon any of the properties or assets of it or its shares under, any law, statute, rule, regulation, judgment, decree, order, government permit, license or order or any mortgage, indenture, note, license, trust, agreement or other agreement, instrument or obligation to which it is a party. 5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE 7 PURCHASER The Purchaser hereby represents, warrants and covenants to the Vendors that each of the following statements is true: 5.1 Organisation and Qualification. It is a person or a legal entity duly organised and validly existing under the laws of its jurisdiction of incorporation. 5.2 Authorisation. It has taken all corporate or other action required to authorise, and has duly authorised, the execution, delivery and performance of this Agreement and upon due execution and delivery the same will constitute its legal, valid and binding obligations enforceable in accordance with its terms. 5.3 Power and Authority. It has full power and authority to make the covenants and representations referred to herein and to purchase the Sale Shares and to execute, deliver and perform this Agreement. 6. CONFIDENTIALITY AND NON-DISCLOSURE 6.1 Non-Disclosure of Terms. The terms and conditions of this Agreement, including its existence, shall be considered confidential information and shall not be disclosed by any party hereto to any third party except in accordance with the provisions set forth below; provided that such confidential information shall not include any information that is in the public domain other than by the breach of the confidentiality obligations hereunder. 6.2 Press Releases, Etc. Any press release issued by any party hereto shall be approved in advance in writing by the both parties hereto, whose consent shall not be unreasonably withheld. No other announcement regarding any of the terms set out in this Agreement in a press release, conference, advertisement, announcement, professional or trade publication, mass marketing materials or otherwise to the general public may be made without the prior written consent of both parties hereto, whose consent shall not be unreasonably withheld. 6.3 Permitted Disclosures. Notwithstanding the foregoing, any party may disclose any of the terms set out this Agreement to its current or bona fide, employees, bankers, lenders, partners, accountants and attorneys and other professional advisers, in each case only where such persons or entities are under appropriate non-disclosure obligations. 6.4 Legally Compelled Disclosure. In the event that any party is requested or becomes legally compelled (including without limitation, pursuant to securities laws and regulations) to disclose the existence or terms of this Agreement in contravention of the provisions of this Clause 6, such party (the "DISCLOSING PARTY") shall provide the other parties (the "NON-DISCLOSING PARTIES") with prompt written notice of that fact and use all reasonable efforts to seek (with the cooperation and reasonable efforts of the other parties) a protective order, confidential treatment or other appropriate remedy. In such event, the Disclosing Party shall furnish only that portion of the information which is legally required and shall exercise reasonable efforts to keep 8 confidential such information to the extent reasonably requested by any Non-Disclosing Party. 6.5 Other Information. The provisions of this Clause 6 shall be in addition to, and not in substitution for, the provisions of any separate nondisclosure agreement executed by any of the parties hereto with respect to the transactions contemplated hereby. 7. MISCELLANEOUS 7.1 Survival of Warranties. The representations, warranties and covenants contained in or made pursuant to this Agreement shall survive the execution and delivery of this Agreement and Closing and shall in no way be affected by any investigation of the subject matter thereof made by or on behalf of the Purchaser. 7.2 Successors and Assigns. Except as otherwise provided herein, the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties (including transferees of any Company Shares sold hereunder). Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement. 7.3 Governing Law and Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of Hong Kong. The parties hereto irrevocably agree to submit to the non-exclusive jurisdiction of the Hong Kong International Arbitration Centre according to UNCITAL Arbitration Rules in all matters arising in connection with this Agreement. 7.4 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. 7.5 Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. 7.6 Notices. Unless otherwise provided, any notice required or permitted under this Agreement shall be given in writing and shall be deemed effectively given upon personal delivery to the party to be notified or upon postal service delivery, by registered or certified mail, postage prepaid and addressed to the party to be notified at the address indicated for such party on the signature page hereof or by facsimile at the facsimile number set out on the signature page hereof, or at such other address or facsimile number as such party may designate by ten (10) days' advance written notice to the other parties. 7.7 Expenses. Each of the parties hereto shall be responsible for its own costs and expenses incurred in the preparation, negotiation and execution of this Agreement. 9 7.8 Stamp duty. Each party to this Agreement shall pay its own share of stamp duty in relation to the sale and purchase of the Sale Shares and the Vendors hereby authorise the Purchaser to deduct from the Purchase Price the Vendors' share of stamp duty. 7.9 Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable law, such provision shall be excluded from this Agreement and the balance of the Agreement shall be interpreted as if such provision was so excluded and shall be enforceable in accordance with its terms. - EXECUTION PAGE FOLLOWS - 10 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. THE VENDOR SIGNED by CHEUNG WAH KEUNG [Chinese Characters] /s/ CHEUNG WAH KEUNG ------------------------------------- SIGNED by LO LI CHUN [Chinese Characters] /s/ LO LI CHUN ------------------------------------- SIGNED by LO SHUI LING RAYMOND [Chinese Characters] /s/ LO SHUI LING RAYMOND ------------------------------------- SIGNED by QUACH FUNG VI [Chinese Characters] /s/ QUACH FUNG VI ------------------------------------- For and on behalf of JUSTLY INVESTMENT INTERNATIONAL LIMITED [Chinese Characters] /s/ ------------------------------------- Name: ------------------------------- Title: ------------------------------ 11 THE PURCHASER For and on behalf of XINHUA FINANCE MEDIA LIMITED By: /s/ John McLean --------------------------------- Name: John McLean Title: Authorized signatory 12 SCHEDULE I LIST OF VENDORS, NUMBER OF SALE SHARES AND PURCHASE PRICE
TOTAL PURCHASE PRICE TO NAME OF VENDOR NO. OF SALE SHARES BE PAID TO EACH VENDOR -------------- ------------------ ----------------------- CHEUNG WAH KEUNG 10,000 USD257,836 LO LI CHUN 12,000 USD309,403 LO SHUI LING RAYMOND 8,000 USD206,268 QUACH FUNG VI 10,000 USD257,836 JUSTLY INVESTMENT INTERNATIONAL LIMITED 2,000 USD51,567
13 SCHEDULE II PARTICULARS OF THE COMPANY BEFORE CLOSING Name: EconWorld Media Limited [Chinese Characters] Date and place of Incorporation December 1, 1999, Hong Kong Registered Address Room 203A, 2/F., Stanhope House, 734-738 King's Road, Hong Kong Authorised share capital HK$10,000 divided into 1,000,000 shares of HK$0.01 each Issued share capital HK$3,500 divided into 350,000 shares of HK$0.01 each No. of Ordinary Shareholders Shareholder Name Shares ---------------- --------------- Gainful Concept Limited 30,000 Cheers Perfect Limited 20,000 Cheung Wah Keung 10,000 Lo Li Chun 30,000 Lo Shui Ling Raymond 10,000 Justly Investment International Limited 5,000 Quach Fung Vi 10,000 EconWorld Holdings Limited 15,000 Best Gain Group Limited 10,000 Xinhua Finance Media Limited 210,000 ------- TOTAL: 350,000 =======
14 SCHEDULE III PARTICULARS OF THE COMPANY IMMEDIATELY AFTER CLOSING Name: EconWorld Media Limited [Chinese Characters] Date and place of Incorporation December 1, 1999, Hong Kong Registered Address Room 203A, 2/F., Stanhope House, 734-738 King's Road, Hong Kong Authorised share capital HK$10,000 divided into 1,000,000 shares of HK$0.01 each Issued share capital HK$3,500 divided into 350,000 shares of HK$0.01 each No. of Ordinary Shareholders Shareholder Name Shares ---------------- --------------- Gainful Concept Limited 30,000 Cheers Perfect Limited 20,000 Lo Li Chun 18,000 Lo Shui Ling Raymond 2,000 Justly Investment International Limited 3,000 EconWorld Holdings Limited 15,000 Best Gain Group Limited 10,000 Xinhua Finance Media Limited 252,000 ------- TOTAL: 350,000 =======
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