EXHIBIT 4.2
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of 5th of December , 2003
(this "Agreement"), is made by and between China World Trade Corporation, a
Nevada corporation (the "Company") and Chi Xxxx XXXXX (the "Vendor").
W I T N E S S E T H:
WHEREAS, pursuant to an Acquisition Agreement, dated as of 19 November,
2003, between the Company and the Vendor (the "Acquisition Agreement"), the
Vendor has agreed to surrender to the Company the after tax rental income of the
Premises for a five-year period commencing 1st day of December 2003 and ending
30th day of November 2008, with an estimated present value of US$1,800,000 in
exchange for, (i) 3,000,000 shares of the Company's common stock ("Company
Shares"), each with par value US$0.001 per share (the "Common Stock"); and (ii)
a two year warrant to purchase up to 6,000,000 shares of the Common Stock at an
exercise price of US$0.75 per share (the "Warrants);
WHEREAS, pursuant to the terms of this Agreement, the Company will
issue and sell to the Vendor the Company Shares, the Warrants and upon the
exercise of the Warrants the Company will issue to the Vendor or its permitted
assigns shares of Common Stock (such Company Shares and shares of Common Stock
issued upon the exercise of the Warrants are collectively referred to herein as
the "Registrable Securities"); and
WHEREAS, to induce the Vendor to execute and deliver the Acquisition
Agreement, the Company has agreed to provide to the Vendor and its permitted
assigns certain registration rights under the Securities Act of 1933, as amended
(the "Securities Act"), and applicable state securities laws; and
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Vendor hereby agree as follows:
1. Definitions.
As used in this Agreement, the following terms shall have the
following meanings:
(a) "Holder" or "Holders" mean a holder or holders of Registrable
Securities or securities convertible into or exercisable for Registrable
Securities.
(b) "Registration Statement" means a registration statement or registration
statements of the Company filed under the Securities Act covering Registrable
Securities.
(c) "Register," "Registered" and "Registration" refer to a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act and pursuant to Rule 415 under the Securities Act or any
successor rule providing for offering securities on a continuous basis ("Rule
415"), and the declaration or ordering of effectiveness of such registration
statement by the United States Securities and Exchange Commission (the
"Commission").
(d) Capitalized terms used herein and not otherwise defined herein shall
have the meanings set forth in the Share Purchase Agreement.
2. DEMAND REGISTRATIONS.
(a) Registration Statement. Subject to the terms of this Agreement, in the
event that the Company shall receive from the Holder(s) (who in the aggregate
hold at least 50% of the Registrable Securities, a written request that the
Company effect any Registration with respect to all or a part of the Registrable
Securities), the Company shall, as soon as practicable and in no event later
than 90 days after the receipt of the written request, prepare and file with the
Commission a Registration Statement or Registration Statements (as necessary) on
Form S-3 (if available) covering the resale of all of the Registrable
Securities. If Form S-3 is unavailable and/or inappropriate for such a
registration, the Company shall use such other form as is available and
appropriate for such a registration. Any Registration Statement prepared
pursuant hereto shall register for resale at least that number of shares of
Common Stock equal to the sum of (i) the maximum number of Registrable
Securities that are Company Shares; and (ii) the maximum number of Registrable
Securities issuable upon exercise of the Warrants without regard to any
limitation on any holder's ability to convert any of the Warrants (such sum, the
"Registrable Amount"). Such Registration Statement shall state that, in
accordance with Rule 416 under the Securities Act, it also covers such
indeterminate number of additional shares of Common Stock ("Shares") as may
become issuable upon exercise of the Warrants (i) resulting from any adjustment
in the applicable price of the Warrants; or (ii) to prevent dilution resulting
from stock splits, stock dividends, recapitalizations, reclassifications,
distributions, consolidations, mergers or similar transactions. If at any time
the Registrable Amount exceeds the total number of Shares so registered, the
Company shall, within ten (10) business days after receipt of a written notice
from the Vendor, either (i) amend the Registration Statement or Registration
Statements filed by the Company pursuant to this section, if such Registration
Statement has not been declared effective by the Commission at that time, to
register the Registrable Amount of Shares, or (ii) if such Registration
Statement has been declared effective by the Commission at that time, file with
the Commission an additional Registration Statement on Form S-3 or such other
appropriate form, to register the number of Shares by which the Registrable
Amount exceeds the number of Shares already registered. The Company shall use
its best efforts to cause the Registration Statement to be declared effective
not later than one hundred eighty (180) days following the Closing Date (the
"Effectiveness Deadline").
(b) The Company shall use its best efforts to keep each Registration
Statement effective pursuant to Rule 415 at all times until such date as is the
earlier of (i) the date on which all of the Registrable Securities have been
sold; and (ii) the date on which the Registrable Securities (in the opinion of
counsel to the Vendor) may be immediately sold without restriction (including
without limitation as to volume by each holder thereof) without registration
under the Securities Act (the "Registration Period").
(c) If any offering pursuant to a Registration Statement pursuant to
Section 2 hereof involves an underwritten offering (which may only be with the
consent of the Company), the Vendor shall have the right to select legal counsel
and an investment banker or bankers and manager or managers to administer the
offering, which investment banker or bankers or manager or managers shall be
reasonably satisfactory to the Company.
3. OBLIGATIONS OF THE COMPANY. In connection with the registration of the
Registrable Securities, the Company shall do each of the following:
(a) Prepare and file with the Commission the Registration Statements
required by Section 2 of this Agreement and such amendments (including
post-effective amendments) and supplements to the Registration Statements and
the prospectuses used in connection with the Registration Statements, each in
such form as to which the Vendor and its counsel shall not have objected, as may
be necessary to keep the Registration current at all times during the
Registration Period, and, during the Registration Period, comply with the
provisions of the Securities Act with respect to the disposition of all of the
Registrable Securities until such time as all of such Registrable Securities
have been disposed of in accordance with the intended methods of disposition by
the seller or sellers thereof as set forth in the Registration Statements;
(b) Furnish to the Vendor, if the Registrable Securities of the Vendor are
included in the Registration Statement, and its legal counsel identified to the
Company, promptly after the same is prepared and publicly distributed, filed
with the Commission, or received by the Company, a copy of the Registration
Statement, each preliminary prospectus, each final prospectus, and all
amendments and supplements thereto and such other documents, as the Vendor may
reasonably request in order to facilitate the disposition of its Registrable
Securities;
(c) As soon as practicable, furnish to the Vendor and its counsel copies of
any correspondence between the Company and the Commission with respect to any
registration statement or amendment or supplement thereto filed pursuant to this
Agreement;
(d) Use all best efforts to (i) register and qualify the Registrable
Securities covered by the Registration Statement under such other securities or
blue sky laws of such jurisdictions as the Vendor may request, (ii) prepare and
file in those jurisdictions such amendments (including post-effective
amendments) and supplements to such registrations and qualifications as may be
necessary to maintain the effectiveness thereof at all times during the
Registration Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during the
Registration Period, and (iv) take all other actions necessary or advisable to
qualify the Registrable Securities for sale in such jurisdictions;
(e) List such securities on The OTCBB or Nasdaq Stock Market and all the
other national securities exchanges on which any securities of the Company are
then listed, and file any filings required by The Nasdaq Stock Market and/or
such other exchanges;
(f) As promptly as practicable after becoming aware of such event, notify
the Vendor of the occurrence of any event of which the Company has knowledge as
a result of which the prospectus included in the Registration Statement, as then
in effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and to use its best efforts to promptly prepare a supplement or
amendment to the Registration Statement or other appropriate filing with the
Commission to correct such untrue statement of omission, and to deliver a number
of copies of such supplement or amendment to the Vendor as it may reasonably
request;
(g) As promptly as practicable after becoming aware of such event, notify
the Vendor who holds Registrable Securities being sold (or, in the event of an
underwritten offering, the managing underwriters) of the issuance by the
Commission of any stop order or other suspension of the effectiveness of the
Registration Statement at the earliest possible time, and to use its best
efforts to promptly obtain the withdrawal of such stop order or other suspension
of effectiveness (the occurrence of any of the events described in paragraphs
(f) and (g) of this Section 3 is referred to herein as a "Blackout Event"), and
the Vendor shall not, during the continuation of a Blackout Event, sell any
Registrable Securities pursuant to a Registration Statement after the Company
has given notice to the Vendor pursuant to the terms hereof that such
Registration Statement is subject to a Blackout Event;
(h) If the Company has consented to an underwritten offering and such
offering is underwritten, at the request of the Vendor, to furnish on the date
that Registrable Securities are delivered to the underwriters for sale pursuant
to such registration: (i) an opinion dated such date of counsel representing the
Company for the purposes of such registration, addressed to the underwriters and
to the Vendor selling Registrable Securities in connection with such
underwriting, stating that such registration statement has become effective
under the Securities Act and that (A) to the best knowledge of such counsel, no
stop order suspending the effectiveness thereof has been issued and no
proceedings for that purpose have been instituted or are pending or contemplated
under the Securities Act, and (B) the registration statement, the related
prospectus and each amendment or supplement thereof comply as to form in all
material respects with the requirements of the Securities Act (except that such
counsel need not express any opinion as to financial statements or other
financial data contained therein), and (ii) a letter dated such date from the
Company's independent public accountants addressed to the underwriters and to
the Vendor, stating that they are independent public accountants within the
meaning of the Securities Act and that, in the opinion of such accountants, the
financial statements of the Company included in the registration statement or
the prospectus, or any amendment or supplement thereof, comply as to form in all
material respects with the applicable accounting requirements of the Securities
Act, and such letter shall additionally cover such other financial matters
(including information as to the period ending no more than five (5) business
days prior to the date of such letter) with respect to such registration as such
underwriters may reasonably request;
(i) Cooperate with the Vendor to facilitate the timely preparation and
delivery of certificates for the Registrable Securities to be offered pursuant
to the Registration Statement and to enable such certificates for the
Registrable Securities to be in such denominations or amounts, as the case may
be, as the Vendor may reasonably request, and registered in such names as the
Vendor may request; and, within three (3) business days after a Registration
Statement which includes Registrable Securities is ordered effective by the
Commission, the Company shall deliver, and shall cause legal counsel selected by
the Company to deliver, to the transfer agent for the Registrable Securities
(with copies to the Vendor) an appropriate instruction and opinion of such
counsel;
(j) Enter into customary agreements (including, in the case of an
underwritten offering, underwriting agreements in customary form, and including
provisions with respect to indemnification and contribution in customary form
and consistent with the provisions relating to indemnification and contribution
contained herein) and take all other customary and appropriate actions in order
to expedite or facilitate the disposition of such Registrable Securities and in
connection therewith:
(i) make such representations and warranties to the Vendor and the
underwriters, if any, in form, substance and scope as are
customarily made by issuers to underwriters in similar
underwritten offerings;
(ii) to the extent requested and customary for the relevant
transaction, enter into a securities sales agreement with the
Vendor and its representative relating to the Registration and
providing for, among other things, the appointment of such
representative as agent for the selling Vendor for the purpose of
soliciting purchases of Registrable Securities, which agreement
shall be customary in form, substance and scope and shall contain
customary representations, warranties and covenants; and
(iii)deliver such customary documents and certificates as may be
reasonably requested by the Vendor whose Registrable Securities
are being sold or by the managing underwriters, if any.
The above shall be done (i) at the effectiveness of such Registration Statement
(and each post-effective amendment thereto) in connection with any registration,
and (ii) at each closing under any underwriting or similar agreement as and to
the extent required thereunder;
(k) The Company shall, at the request of the Vendor, make generally
available to its security holders as soon as practicable, but not later than
ninety (90) days after the close of the period covered thereby, an earnings
statement (in form complying with the provisions of Rule 158 under the
Securities Act) covering a twelve-month period beginning not later than the
first day of the Company's fiscal quarter next following the effective date of a
Registration Statement;
(l) The Company shall make available for inspection by (i) the Vendor, (ii)
any underwriter participating in any disposition pursuant to a Registration
Statement, (iii) one firm of attorneys and one firm of accountants or other
agents retained by the Vendor, and (iv) one firm of attorneys retained by all
such underwriters (collectively, the "Inspectors") all pertinent financial and
other records, and pertinent corporate documents and properties of the Company
(collective, the "Records"), as shall be reasonably deemed necessary by each
Inspector to enable each Inspector to exercise its due diligence responsibility,
and cause the Company's officers, directors and employees to supply all
information which any Inspector may reasonably request for purposes of such due
diligence; provided, however, that each Inspector shall hold in confidence and
shall not make any disclosure (except to the Inspectors) of any Record or other
information which the Company determines in good faith to be confidential, and
of which determination the Inspectors are so notified, unless (a) the disclosure
of such Records is necessary to avoid or correct a material misstatement or
omission in any Registration Statement, (b) the release of such Records is
ordered pursuant to a subpoena or other order from a court or government body of
competent jurisdiction, or (c) the information in such Records has been made
generally available to the public other than by disclosure in violation of this
or any other agreement. The Company shall not be required to disclose any
confidential information in such Records to any Inspector until and unless such
Inspector shall have entered into confidentiality agreements (in form and
substance satisfactory to the Company) with the Company with respect thereto,
substantially in the form of this Section 3(m). The Vendor agrees that upon
learning that the release of such Records is ordered pursuant to a subpoena or
other order from a court or government body of competent jurisdiction, it shall
give prompt notice to the Company and allow the Company, at its expense, to
undertake appropriate action to prevent disclosure of, or to obtain a protective
order for, the Records deemed confidential. Nothing herein shall be deemed to
limit the Vendor' ability to sell Registrable Securities in a manner which is
otherwise consistent with applicable laws and regulations; and
(m) The Company shall hold in confidence and not make any disclosure of
information concerning the Vendor provided to the Company unless (i) disclosure
of such information is necessary to comply with federal or state securities
laws, (ii) the disclosure of such information is necessary to avoid or correct a
misstatement or omission in any Registration Statement, (iii) the release of
such information is ordered pursuant to a subpoena or other order from a court
or governmental body of competent jurisdiction, or (iv) such information has
been made generally available to the public other than by disclosure in
violation of this or any other agreement. The Company agrees that it shall, upon
learning that disclosure of such information concerning the Vendor is sought in
or by a court or governmental body of competent jurisdiction or though other
means, give prompt notice to the Vendor prior to making such disclosure, and
allow the Vendor, at its expense, to undertake appropriate action to prevent
disclosure of, or to obtain a protective order for, such information.
4. OBLIGATIONS OF THE VENDOR. In connection with the registration of the
Registrable Securities, the Vendor shall furnish to the Company such information
regarding itself, the Registrable Securities held by it and the intended method
of disposition of the Registrable Securities held by it as shall be reasonably
required to effect the registration of such Registrable Securities, and the
Vendor shall execute such documents in connection with such registration as the
Company may reasonably request. At least five (5) days prior to the first
anticipated filing date of the Registration Statement, the Company shall notify
the Vendor of the information the Company included in the Registration
Statement. The Vendor shall not, during the continuation of a Blackout Event,
sell any Registrable Securities pursuant to a Registration Statement after the
Company has given notice to the Vendor pursuant to the terms hereof that such
Registration Statement is subject to a Blackout Event (as defined in Section
3(g) hereof).
5. EXPENSES OF REGISTRATION. All expenses, other than underwriting
discounts and commissions and other fees and expenses of investment bankers and
other than brokerage commissions, incurred in connection with registrations,
filings or qualifications pursuant to Section 3, but including, without
limitation, all registration, listing, and qualification fees, printing and
accounting fees, and the fees and disbursements of counsel for the Company, and
the fees of one counsel to the Vendor with respect to each Registration
Statement filed pursuant hereto, shall be borne by the Company provided, that
the expenses of the Vendor' counsel shall not exceed US$15,000.
6. INDEMNIFICATION. If any Registrable Securities are included in a
Registration Statement under this Agreement:
(a) The Company will indemnify and hold harmless the Vendor, each of its
officers, directors, partners and shareholders, and each person, if any, who
controls the Vendor within the meaning of the Securities Act or the Exchange Act
(each, an "Indemnified Person"), against any losses, claims, damages,
liabilities or expenses (joint or several) incurred (collectively, "Claims") to
which any of them may become subject under the Securities Act, the Exchange Act
or otherwise, insofar as such Claims (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of or are based upon: (i)
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or any post-effective amendment thereof or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances in which they were made, not misleading, (ii) any untrue
statement or alleged untrue statement of a material fact contained in any
preliminary prospectus if used prior to the effective date of such Registration
Statement, or contained in the final prospectus (as amended or supplemented, if
the Company files any amendment thereof or supplement thereto with the
Commission) or the omission to state therein any material fact necessary in
order to make the statements made therein, in light of the circumstances under
which they were made, not misleading, or (iii) any violation or alleged
violation by the Company of the Securities Act, the Exchange Act, any state or
foreign securities law or any rule or regulation under the Securities Act, the
Exchange Act or any state or foreign securities law (the matters in foregoing
clauses (i) through (iii) being, collectively, "Violations"). The Company shall,
subject to the provisions of Section 6(b) below, reimburse the Vendor, promptly
as such expenses are incurred and are due and payable, for any legal and other
costs, expenses and disbursements in giving testimony or furnishing documents in
response to a subpoena or otherwise, including without limitation, the costs,
expenses and disbursements, as and when incurred, of investigating, preparing or
defending any such action, suit, proceeding or investigation (whether or not in
connection with litigation in which the Vendor is a party), incurred by it in
connection with the investigation or defense of any such Claim. Notwithstanding
anything to the contrary contained herein, the indemnification agreement
contained in this Section 6(a) shall not (i) apply to any Claim arising out of
or based upon a modification which occurs in reliance upon and in conformity
with information furnished in writing to the Company by or on behalf of any
Indemnified Person expressly for use in connection with the preparation of the
Registration Statement or any such amendment thereof or supplement thereto; (ii)
with respect to any preliminary prospectus, inure to the benefit of any such
person from whom the person asserting any such Claim purchased the Registrable
Securities that are the subject thereof (or to the benefit of any person
controlling such person) if the untrue statement or omission of material fact
contained in the preliminary prospectus was corrected in the final prospectus,
as then amended or supplemented, if such final prospectus was timely made
available by the Company pursuant to Section 3(b) hereof; (iii) be available to
the extent that such Claim is based upon a failure of the Vendor to deliver or
to cause to be delivered the prospectus made available by the Company, if such
prospectus was timely made available by the Company pursuant to Section 3(b)
hereof; or (iv) apply to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of the Company, which
consent shall not be unreasonably withheld. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of the
Indemnified Person and shall survive the transfer of the Registrable Securities
by the Vendor pursuant to Section 9. The Vendor will indemnify the Company and
its officers and directors against any Claims arising out of or based upon a
Violation which occurs in reliance upon and in conformity with information
furnished in writing to the Company, by or on behalf of the Vendor, expressly
for use in connection with the preparation of the Registration Statement
(including any modifications, amendments or supplements thereto), subject to
such limitations and conditions as are applicable to the Indemnification
provided by the Company in this Section 6; provided, however, that in no event
shall any indemnity by the Vendor under this Section 6 exceed the amount of the
net proceeds received by the Vendor in connection with the offering effected
through such Registration Statement.
(b) Promptly after receipt by an Indemnified Person under this Section 6 of
notice of the commencement of any action (including any governmental action),
such Indemnified Person shall, if a Claim in respect thereof is to be made
against any indemnifying party under this Section 6, deliver to the indemnifying
party a written notice of the commencement thereof, and the indemnifying party
shall have the right to participate in, and to the extent that the indemnifying
party so desires, jointly with any other indemnifying party similarly notified,
to assume control of the defense thereof with counsel mutually satisfactory to
the indemnifying party and the Indemnified Person, provided, however, that an
Indemnified Person shall have the right to retain its own counsel with the
reasonable fees and expenses to be paid by the indemnifying party, if, in the
reasonable opinion of counsel retained by the indemnifying party, the
representation by such counsel of the Indemnified Person and the indemnifying
party would be inappropriate due to actual or potential differing interests
between such Indemnified Person and any other party represented by such counsel
in such proceeding. In such event, the Company shall pay for only one separate
legal counsel for the Vendor, and such legal counsel shall be selected by the
Vendor. The failure to deliver written notice to an indemnifying party within a
reasonable time after the commencement of any such action shall not relieve such
indemnifying party of any liability to the Indemnified Person under this Section
6, except to the extent that the indemnifying party is materially prejudiced in
its ability to such action. The indemnification required by this Section 6 shall
be made by periodic payments of the amount thereof during the course of the
investigation or defense, as such expense, loss, damage or liability is incurred
and is due and payable.
(c) No indemnifying party, in the defense of any such claim or litigation,
shall, except with the consent of each Indemnified Party, consent to entry of
any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Person of an unconditional and irrevocable release from all
liability in respect of such claim or litigation.
(d) Notwithstanding the foregoing, to the extent that any provisions
relating to indemnification or contribution contained in the underwriting
agreements entered into among the Company, the underwriters and the Vendor in
connection with the underwritten public offering are in conflict with the
foregoing provisions, the provisions in such underwriting agreements shall be
controlling as to the Registrable Securities included in the public offering;
provided, however, that if, as a result of this Section 6(d), the Vendor, its
officers, directors, partners, shareholders or any person controlling the Vendor
is or are held liable with respect to any Claim for which they would be entitled
to indemnification hereunder but for this Section 6(d) in an amount which
exceeds the aggregate proceeds received by the Vendor from the sale of
Registrable Securities included in a registration pursuant to such underwriting
agreement (the "Excess Liability"), the Company shall reimburse the Vendor for
such Excess Liability.
7. CONTRIBUTION. To the extent any indemnification by an indemnifying party
is prohibited or limited under applicable law, the indemnifying party agrees to
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage, liability or expense in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one
hand and the Indemnified Person on the other hand in connection with the
statements or omissions which resulted in such Claim, as well as any other
relevant equitable considerations. The relative fault of the indemnifying party
and the Indemnified Person shall be determined by reference to, among other
things, whether the untrue statement of a material fact or the omission to state
a material fact on which such Claim is based relates to information supplied by
the indemnifying party or by the Indemnified Person, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. Notwithstanding the forgoing, (a) no contribution
shall be made under circumstances where the payor would not have been liable for
indemnification under the fault standards set forth in Section 6, (b) no seller
of Registrable Securities guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any seller of Registrable Securities who was not guilty of
such fraudulent misrepresentation, and (c) contribution by any seller of
Registrable Securities shall be limited in amount to the net proceeds received
by such seller from the sale of such Registrable Securities. The Company and the
Vendor agree that it would not be just and equitable if contribution pursuant to
this Section 7 were determined by pro rata allocation (even if the Vendor and
any other party were treated as one entity for such purpose) or by any other
method of allocation that does not take account of the equitable considerations
referred to in this Section.
8. REPORTS UNDER EXCHANGE ACT. With a view to making available to the
Vendor the benefits of Rule 144 promulgated under the Securities Act or any
other similar rule or regulation of the Commission that may at any time permit
the Vendor to sell securities of the Company to the public without registration
("Rule 144"), the Company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) file with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and
(c) furnish to the Vendor so long as it owns Registrable Securities
promptly upon request, (i) a written statement by the Company that it has
complied with the reporting requirements of the Securities Act and the Exchange
Act, (ii) a copy of the most recent annual or periodic report of the Company and
such other reports and documents so filed by the Company, and (iii) such other
information as may be reasonably requested to permit the Vendor to sell such
securities pursuant to Rule 144 without registration.
9. ASSIGNMENT OF THE REGISTRATION RIGHTS. The rights to have the Company
register Registrable Securities pursuant to this Agreement shall be
automatically assigned by the Vendor to any transferee of all or any portion of
the principal amount of the Warrants, or the underlying Common Stock held by the
Vendor (collectively, the "Securities") if: (a) the Vendor agrees in writing
with the transferee or assignee to assign such rights, and a copy of such
agreement is furnished to the Company within a reasonable time after such
assignment; (b) the Company is, within a reasonable time after such transfer or
assignment, furnished with written notice of the name and address of such
transferee or assignee; (c) at or before the time the Company receives the
written notice contemplated by clause (b) of this sentence, the transferee or
assignee agrees in writing with the Company to be bound by all of the provisions
contained herein; and (d) the transfer of the relevant Securities complies with
the restrictions set forth in Section 4 of the Share Purchase Agreement.
10. AMENDMENT OF REGISTRATION RIGHTS. Any provision of this Agreement may
be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and the Vendor holding two thirds (2/3) of the
outstanding Registrable Securities. Any amendment or waiver effected in
accordance with this Section 10 shall be binding upon the Vendor and the
Company.
11. MISCELLANEOUS.
(a) A person or entity is deemed to be a holder of Warrants or Registrable
Securities whenever such person or entity owns of record such Warrants or
Registrable Securities. If the Company receives conflicting instructions,
notices or elections from two or more persons or entities with respect to the
same Warrants or Registrable Securities, the Company shall act upon the basis of
the instructions, notice or election received from the registered owner of such
Warrants or Registrable Securities.
(b) Any notice required or permitted hereunder shall be given in writing
(unless otherwise specified herein) and shall be effective upon personal
delivery, via facsimile (upon receipt of confirmation of error-free
transmission) or two business days following deposit of such notice with an
internationally recognized courier service, with postage prepaid and addressed
to each of the other parties thereunto entitled at the following addresses, or
at such other addresses as a party may designate by ten (10) days advance
written notice to each of the other parties hereto.
COMPANY: China World Trade Corporation
3-4/F Goldlion Digital Network Center
000 Xxxx Xxxx Xxxx, Xxxxxx
Xxxxxxxxx 000000
The People's Republic of China
ATTENTION: Xx. Xxxx Xxx
Tel.: (8620) 0000-0000
Fax: (8620) 0000-0000
VENDOR Chi Xxxx XXXXX
Unit no. 1217
12/F The Xxxxxxxxxx Xxxxx
00 Xxxxxxxxxx Xxxxx
Xxxxxxx
Xxxxxxx, Xxxx Xxxx
Tel.: (000) 0000-0000
Fax.: (000) 0000-0000
email: xxxxxxx@xxxx.xxxx00.xxx
With copies to:
Heller, Ehrman, White & XxXxxxxxx LLP
00xx Xxxxx, Xxx Xxxxxxxx Xxxxxx
0 Xxxxxxxxx Xxxxx, Xxxxxxx
Xxxx Xxxx
Attention: Xxxxx Xxx, Xxx.
xxx Xxxxxxx Xxx, Xxx.
Tel.: (852)-2292-2000
Fax.: (852)-2292-2200
(c) Failure of any party to exercise any right or remedy under
this Agreement or otherwise, or delay by a party in exercising such right or
remedy, shall not operate as a waiver thereof.
(d) This Agreement shall be governed by and interpreted in
accordance with the laws of the State of California, except for provisions with
respect to internal corporate matters of the Company which shall be governed by
the corporate laws of the State of Nevada. Each of the parties agrees to the
jurisdiction of the federal courts whose districts encompass any part of the
State of California or the state courts of the California in connection with any
dispute arising under this Agreement and hereby waives, to the maximum extent
permitted by law, any objection, including any objection based on forum non
conveniens, to the bringing of any such proceeding in such jurisdictions. This
Agreement may be signed in two or more counterparts, each of which shall be
deemed an original. The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement. If any provision of this Agreement shall be invalid or unenforceable
in any jurisdiction, such validity or unenforceability shall not affect the
validity or enforceability of the remainder of this Agreement or the validity or
enforceability of this Agreement in any other jurisdiction. Subject to the
provisions of Section 10 hereof, this Agreement may be amended only by an
instrument in writing signed by the party to be charged with enforcement.
(e) This Agreement, together with the Share Purchase Agreement
and the Warrants, constitutes the entire agreement among the parties hereto with
respect to the subject matter hereof. This Agreement supersedes all prior
agreements and understandings among the parties hereto with respect to the
subject matter hereof.
(f) Subject to the requirements of Section 9 hereof, this
Agreement shall inure for the benefit of and be binding upon the successors and
assigns of each of the parties hereto.
(g) All pronouns and any variations thereof refer to the
masculine, feminine or neuter, singular or plural, as the context may require.
(h) The Company acknowledges that any failure by the Company
to perform its obligations under Section 2, or any delay in such performance
could result in direct and indirect damages to the Vendor, and the Company
agrees that, in addition to any other liability the Company may have by reason
of any such failure or delay, the Company shall be liable for all direct and
consequential damages caused by any such failure or delay. Nothing herein shall
limit the Vendor' right to pursue any claim seeking such direct or consequential
damages.
[Signature page follows]
IN WITNESS WHEREOF, this Agreement has been duly executed by the undersigned.
Dated: 5 December, 2003
"COMPANY"
China World Trade Corporation
By:/s/ CHAO XXXX XXX
---------------------------------
Name: Chao Xxxx Xxx
Title: Director
"VENDOR"
Chi Xxxx XXXXX
By: /s/ CHI XXXX XXXXX
--------------------------------
Name: Chi Xxxx Xxxx
