CONVERSION AGREEMENT
Exhibit
10.14
This CONVERSION AGREEMENT (the
“Agreement”) is made effective as of March 20, 2008, by and between Xxxxx Xxxxx
(the “Aubel”), and China Logistics Group, Inc., a Florida corporation, with its
registered office located at 000 Xxxx Xxx Xxxx Xxxxxxxxx, Xxxxx 000, Xx.
Xxxxxxxxxx, Xxxxxxx 00000 (“China Logistics”).
W I T N E
S S E T H:
WHEREAS, Aubel owns and holds a note
payable of China Logistics (formerly known as MediaReady, Inc.) with a principal
balance and accrued interest in the total amount of $2,521,379 (the “Note
Payable”);
WHEREAS, Aubel agreed to convert the
Note Payable into 2,864,606 shares of China Logistics’ common stock, $.001 par
value per share (the “Conversion Shares”) in connection with the December 31,
2007 Acquisition Agreement entered into between China Logistics and Shandong
Jiajia International Freight & Forwarding Co., Ltd. (the “Acquisition
Agreement”);
WHEREAS, Aubel and China Logistics wish
to set forth their agreement in writing in accordance with the terms
hereof.
NOW, THEREFORE, in consideration of the
mutual provisions and covenants contained herein, the parties hereto, intending
to be legally bound, hereby agree as follows:
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1.
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Conversion of the Note
Payable. Aubel hereby agrees to release China Logistics
from any and all liability or obligations for the Note Payable in exchange
for the issuance by China Logistics of 2,864,606 shares of China
Logistics’ common stock, $.001 par value per share (the “Conversion
Shares”) in connection with the December 31, 2007 Acquisition Agreement
entered into between China Logistics and Shandong Jiajia International
Freight & Forwarding Co., Ltd. (the “Acquisition
Agreement”). China Logistics agrees to issue the Conversion
Shares in exchange for and in consideration of Xxxxx’x agreement to
release China Logistics from the liabilities due and owning Aubel under
the Note Payable.
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2.
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Representations and
Warranties.
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(a)
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Information on
Company. Aubel has been furnished with or has had access at the
XXXXX Website of the Commission to China Logistics' Form 10-K (and any
amendments thereto) for the fiscal year ended December 31, 2007 and all
periodic and current reports filed with the Commission thereafter, but not
later than five business days before the Closing (hereinafter referred to
as the “Reports”). In addition, Aubel has received in writing from China
Logistics such other information concerning its operations, financial
condition and other matters as Aubel has requested in writing (such other
information is collectively, the “Other Written Information”), and
considered all factors Aubel deems material in deciding on the
advisability of investing in the Conversion
Shares.
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(b)
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Information on
Aubel. Aubel (i) is, and will be on the date hereof, an “accredited
investor”, as such term is defined in Regulation D promulgated by the
Commission under the 1933 Act, (ii) is experienced in investments and
business matters, (iii) has made investments of a speculative nature and
has purchased securities of United States publicly-owned companies in
private placements in the past and, (iv) alone or with its
representatives, has such knowledge and experience in financial, tax and
other business matters as to enable Aubel to utilize the information made
available by China Logistics to evaluate the merits and risks of and to
make an informed investment decision with respect to the proposed
purchase, which represents a speculative investment. Aubel is able to bear
the risk of such investment for an indefinite period and to afford a
complete loss thereof. The information set forth on the signature page
hereto regarding Aubel is accurate.
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(c)
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Purchase of Conversion
Shares. On the date hereof, Aubel will purchase the Conversion
Shares as principal for its own account for investment only and not with a
view toward, or for resale in connection with, the public sale or any
distribution thereof.
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(d)
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Compliance with
Securities Act. Aubel understands and agrees that the Conversion
Shares have not been registered under the 1933 Act or any applicable state
securities laws, by reason of their issuance in a transaction that does
not require registration under the 1933 Act (based in part on the accuracy
of the representations and warranties of Aubel contained herein), and that
such Conversion Shares must be held indefinitely unless a subsequent
disposition is registered under the 1933 Act or any applicable state
securities laws or is exempt from such
registration.
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(e)
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Notwithstanding
anything to the contrary contained in this Agreement, Aubel may transfer
(without restriction and without the need for an opinion of counsel) the
Conversion Shares to its Affiliates (as defined below) provided that each
such Affiliate is an “accredited investor” under Regulation D and such
Affiliate agrees to be bound by the terms and conditions of this
Agreement. For the purposes of this Agreement, an “Affiliate” of any
person or entity means any other person or entity directly or indirectly
controlling, controlled by or under direct or indirect common control with
such person or entity. Affiliate when employed in connection with China
Logistics includes each subsidiary of China Logistics. For purposes of
this definition, “control” means the power to direct the management and
policies of such person or firm, directly or indirectly, whether through
the ownership of voting securities, by contract or
otherwise.
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(f)
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Legends on Conversion
Shares. The Conversion Shares shall bear the following or similar
legend:
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“THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. THESE SHARES MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAW OR
AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO CHINA LOGISTICS, INC. THAT SUCH
REGISTRATION IS NOT REQUIRED.”
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(g)
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Communication of
Offer. The offer to sell the Conversion Shares was directly
communicated to Aubel by China Logistics. At no time was Aubel presented
with or solicited by any leaflet, newspaper or magazine article, radio or
television advertisement, or any other form of general advertising or
solicited or invited to attend a promotional meeting otherwise than in
connection and concurrently with such communicated
offer.
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(h)
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Complete
Release. Aubel hereby covenants and agrees that China
Logistics has no further obligations to Aubel or any entities related to
him.
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3.
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Miscellaneous.
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(a)
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Governing
Law. This Agreement and all questions relating to its
validity, interpretation, performance and enforcement shall be governed by
and construed in accordance with the laws of the State of Florida without
giving effect to conflicts of law
principles.
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(b)
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Binding Nature of
Agreement; No Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns, except
that no party may assign or transfer its rights under this Agreement
without the prior written consent of the other party
hereto.
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(c)
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Execution in
Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original as
against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument. This Agreement
shall become binding when one or more counterparts hereof, individually or
taken together, shall bear the signatures of all of the parties reflected
hereon as the signatories. The parties agree that a facsimile
signature shall have the same validity as an
original.
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(d)
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Provisions
Separable. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be
affected or rendered invalid or unenforceable by virtue of the fact that
for any reason any other or others of them may be invalid or unenforceable
in whole or in part.
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(e)
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Paragraph
Headings. The section headings in this Agreement are for
convenience only; they form no part of this Agreement and shall not affect
its interpretation.
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(f)
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Gender,
Etc. Words used herein, regardless of the number and
gender specifically used, shall be deemed and construed to include any
other number, singular or plural, and any other gender, masculine,
feminine or neuter, as the context indicates is
appropriate.
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(g)
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Further
Assurances. Each of Aubel and China Logistics agrees
that it shall take such further actions, file such forms and reports and
execute such additional documents and instruments and do such other things
as may be necessary in order to more fully effectuate the intent and
purposes of this Agreement.
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IN
WITNESS WHEREOF, the parties have executed and delivered this Agreement on the
date first above written.
| China Logistics Group, Inc. | |
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By: /s/ V. Xxxxxxx
Xxxxxxx
Name:
V. Xxxxxxx Xxxxxxx
Title:
President, CEO
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/s/ Xxxxx
Xxxxx
Xxxxx
Xxxxx
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