Elevatech Limited 68th Floor, Cheung Kong Center
Execution
Version
Elevatech
Limited
68th
Floor, Xxxxxx Kong Center
0 Xxxxx’x
Xxxx Xxxxxxx
Xxxx
Xxxx
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To:
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Windrace
International Company Limited (formerly XDLong International Company
Limited) (the Company)
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Xx Xxx
Shuipan (Lin)
Richwise
International Investment Group Limited (Richwise)
8 May
2009
Ladies
and Gentlemen:
We refer
to the shareholders agreement between, among others, the Company, Lin, Richwise
and ourselves dated 30 April 2008 (the Shareholders
Agreement),
the amended and restated articles of association of the Company adopted
on 30 April 2008 (the Articles) and the term
sheet among the Company, Lin, Richwise and ourselves dated 5 May 2009 (the Term Sheet).
Capitalized
terms not otherwise defined herein shall have the meanings given to them in the
Shareholders Agreement.
For the
purposes of this letter, the Financing
Transaction will consist of the Key Transaction and one or more Ancillary
Transactions, if any.
The Key Transaction
refers to the sale of all issued and outstanding Ordinary Shares by the
Ordinary Shareholders to Exceed Company Limited, a company incorporated under
the laws of British Virgin Islands with limited liability (the Purchaser) and a
wholly-owned subsidiary of 2020 Chinacap Acquireco., Inc., a company
incorporated under the laws of Delaware with limited liability (the SPAC), pursuant to the
Agreement for Sale and Purchase substantially in the form attached as Annex A hereto and
dated on or about the date hereof (the Sale and Purchase
Agreement).
Following the sale, the SPAC will merge with and into the
Purchaser.
An Ancillary
Transaction,
if any, refers to an issuance of equity or debt securities by the
Purchaser, such issuance to be completed simultaneously with or after the
completion of the Key Transaction, although all or a portion of the proceeds of
any such issuance may be deposited into an escrow account for the Company’s
benefit prior to the consummation of the Key Transaction.
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Execution
Version
In order
to facilitate the Company’s entering into the Financing Transaction, it is
hereby agreed, as follows:
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(a)
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we
consent to the Company’s entering into the Sale and Purchase Agreement and
the transfer of the Ordinary Shares by all of the Ordinary Shareholders
(the Selling
Shareholders)
pursuant to the Sale and Purchase
Agreement;
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(b)
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we
agree with the Company that, upon completion of the Financing Transaction,
the Preferred Shares shall be redeemed by the Company in consideration for
the issue by the Company to the Investor of a promissory note (the Promissory
Note)
giving the holder the right to receive from the Company
HK$306,267,580.48 by the earlier of (i) five (5) Business Days of the date
of issue of the promissory note; and (ii) October 31, 2009, and
US$1,000,000 on June 30, 2010, and the issue by Lin and Richwise of
guarantees (the Personal
Guarantees),
the respective terms of which (save for the payment date of
the First Installment set forth in this item (b)) are set out in the Term
Sheet; and
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(c)
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we
agree to issue one or more waivers substantially in the form set forth in
Annex B
hereto, consenting to the Company entering into contracts relating to the
Ancillary Transactions; provided that, in respect of each Ancillary
Transaction, the Company shall provide written notice (Notice) to us
setting out to our satisfaction details of: (i) the parties to the
Ancillary Transaction; (ii) the nature of the Ancillary Transaction; (iii)
the amount of funds expected to be raised by the Ancillary Transaction and
proposed use of proceeds; (iv) a confirmation that the proceeds of the
Ancillary Transaction shall be applied in whole or in part to redeem the
Preferred Shares; and (v) any other information necessary for us to make
an informed decision on the grant of the
waiver;
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PROVIDED
THAT, such consent and agreement shall be conditional on:
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(i)
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the
delivery by the Company to us draft copies of the following documents (the
Transaction
Documents)
within five business days of the date
hereof:
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1)
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a
redemption agreement providing for the redemption of the Preferred
Shares;
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2)
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the
Promissory Note;
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3)
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board
resolutions authorising the issuance of the Promissory Note and the
issuance of any preference shares upon any conversion of the Promissory
Note (the Conversion
Shares);
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4)
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an
instruction letter to the Company’s registered agent irrevocably
authorizing registration of Elevatech as a holder of the Conversion Shares
upon their issuance by the Company;
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5)
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an
Amendment to the Articles providing for the potential conversion of
Promissory Note into the Conversion
Shares;
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6)
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an
Amendment to the Shareholders Agreement providing for its continued
effectiveness in the event Elevatech becomes a holder of the Conversion
Shares (the Conversion
Time)
and for the redemption referred to in 8
below;
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Execution
Version
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7)
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a
Deed of Adherence between the Company and the Purchaser, the form of which
is set forth Schedule 2 to the Shareholders Agreement, providing for the
Purchaser’s agreement to become a party to the Shareholders Agreement at
the Conversion Time; and
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8)
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a
deed of covenant from the Company, Lin and Richwise in favour of Elevatech
providing that, in the event that Elevatech holds any Preferred Shares or
Conversion Shares after the completion of the Financing Transaction and
either Lin or Richwise transfer any shares they hold in the Purchaser
prior to 31 December 2009, then any Preferred Shares or Conversion Shares
held by Elevatech shall be immediately redeemable under the terms and
conditions of such Preferred Shares or Conversion Shares, as the case may
be;
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(ii)
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the
Transaction Documents being concluded, executed and delivered in form and
substance satisfactory to us prior to or upon the completion of the
Financing Transaction;
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(iii)
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the
Financing Transaction being consummated in accordance with the terms set
out in the Sale and Purchase
Agreement;
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(iv)
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the
Promissory Note and Personal Guarantees being issued to us upon completion
of the Financing Transaction;
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(v)
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except
with our prior written consent, no variation is made to the actions or
delivery obligations of (A) the Selling Shareholders under Schedule 3,
Section A, Clause 1.1(c), 1.2, 1.3, 1.4, 1.5, 1.6, 1.7, 1.8 and 2.9; (B)
the Purchaser under Schedule 3, Section B, Clauses 1.1(e) and 2.7; and (C)
the SPAC under Schedule 3, Section C, Clause 1.1, 1.2, 2.1 and 2.4,
respectively, of the Sale and Purchase Agreement;
and
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(vi)
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the
SPAC issuing irrevocable payment instructions upon completion of the
Financing Transaction for the payment to us of a sum in full satisfaction
of the First Installment (as defined in the Term Sheet) of the Promissory
Note;
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and in
the event that any of such conditions is not fulfilled the consent and agreement
set out herein shall be null and void ab initio.
This
letter agreement shall terminate on 31 October 2009 and have no further effect
after that date. Without limiting the generality of the foregoing, if the
Financing Transaction does not take place on or before 31 October 2009, the
Preferred Shares shall remain outstanding and their terms and conditions shall
remain unchanged.
This
letter agreement is governed by and shall be construed in accordance with the
laws of Hong Kong.
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Execution
Version
Kindly
indicate your acceptance of the terms of this letter by signing and returning to
us the enclosed copy.
Yours
truly,
For and
on behalf of
Elevatech
Limited
Agreed
and accepted
For and
on behalf of
Windrace
International Company Limited
Xx Xxx Shuipan
For and
on behalf of
Richwise
International Investment Group Limited
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Annex A
FORM
OF SALE AND PURCHASE AGREEMENT
Annex B
FORM
OF ANCILLARY TRANSACTION WAIVER
[On letterhead of
Investor]
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To:
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Windrace
International Company Limited (the Company)
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Xx
Xxx Shuipan (Lin)
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Richwise
International Investment Group Limited (Richwise)
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__________ 2009
Ladies
and Gentlemen:
Waiver
of Ancillary Transaction
We refer
to the letter agreement among the Company, Lin, Richwise and ourselves dated
________ 2009 (the Elevatech Letter
Agreement).
Capitalised terms not otherwise defined herein shall have the meanings
given to them in the Elevatech Letter Agreement.
We
acknowledge our receipt from the Company a Notice dated
, 2009 concerning an Ancillary Transaction. We hereby consent to the Company
entering into an Agreement in respect of the Ancillary Transaction described in
the Notice, provided that, in the event that any of such conditions in the
Elevatech Letter Agreement is not fulfilled, the consent set out herein shall be
null and void ab
initio.
This
Waiver shall terminate on 31 October 2009 and have no further effect after that
date. Without limiting the generality of the foregoing, if the Financing
Transaction does not take place on or before 31 October 2009, the Preferred
Shares shall remain outstanding and their terms and conditions shall remain
unchanged.
Annex B
Kindly
indicate your acceptance of the terms of this letter by signing and returning to
us the enclosed copy.
Yours
truly,
For and on behalf of
Elevatech
Limited
Agreed
and accepted
For and on behalf of
Windrace
International Company Limited
Xx Xxx Shuipan
For and on behalf of
Richwise
International Investment Group Limited
Execution
Version
Kindly
indicate your acceptance of the terms of this letter by signing and returning to
us the enclosed copy.
Yours
truly,
For and
on behalf of
Elevatech
Limited
Agreed
and accepted
For and on behalf of
Windrace
International Company Limited
Xx Xxx
Shuipan
For and on behalf of
Richwise
International Investment Group Limited
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Execution
Version
Kindly
indicate your acceptance of the terms of this letter by signing and returning to
us the enclosed copy.
Yours
truly,
For and on behalf of
Elevatech
Limited
Agreed
and accepted
For and on behalf of
Windrace
International Company Limited
Xx Xxx Shuipan
For and on behalf of
Richwise
International Investment Group Limited
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Execution
Version
Kindly
indicate your acceptance of the terms of this letter by signing and returning to
us the enclosed copy.
Yours
truly,
For and on behalf of
Elevatech
Limited
Agreed
and accepted
For and on behalf of
Windrace
International Company Limited
Xx Xxx
Shuipan
For and on behalf of
Richwise
International Investment Group Limited
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