FORM OF UNDERWRITING AGREEMENT between FUNTALK CHINA HOLDINGS LIMITED and RODMAN & RENSHAW, LLC as Representative
Exhibit
1.1
FORM
OF
between
FUNTALK
CHINA HOLDINGS LIMITED
and
XXXXXX
& XXXXXXX, LLC
as
Representative
FUNTALK
CHINA HOLDINGS LIMITED
___________
__, 2009
Xxxxxx
& Xxxxxxx, LLC
1251
Avenue of the Xxxxxxxx, 00xx
Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Ladies
and Gentlemen:
The
undersigned, Funtalk China Holdings Limited, a company formed under the laws of
the Cayman Islands (collectively with its subsidiaries and affiliates,
including, without limitation, all entities disclosed or described in the
Registration Statement (as hereinafter defined) as being subsidiaries or
affiliates of the Company, the “Company”), hereby
confirms its agreement with Xxxxxx & Xxxxxxx, LLC (hereinafter referred to
as “you”
(including its correlatives) or the “Representative”) and
with the other underwriters named on Schedule 1 hereto for which the
Representative is acting as representative (the Representative and such other
underwriters being collectively called the “Underwriters” or,
individually, an “Underwriter”) as
follows:
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1.
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Purchase and Sale of
Securities.
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1.1 Firm
Securities.
1.1.1. Nature and Purchase of Firm
Securities.
(i) On
the basis of the representations and warranties herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to issue and sell,
severally and not jointly, to the several Underwriters, an aggregate of
_____________ shares (“Firm Shares”) of the
Company’s ordinary shares, par value $0.001 per share (the “Shares”).
(ii) The
Underwriters, severally and not jointly, agree to purchase from the Company the
number of Firm Shares set forth opposite their respective names on Schedule 1
attached hereto and made a part hereof at a purchase price (net of discounts and
commissions) of [___] per Share (93% of the per Share offering price). The Firm
Shares are to be offered initially to the public (the “Offering”) at the
offering price set forth on the cover page of the Prospectus (as defined in
Section 2.1.1 hereof).
1.1.2. Shares Payment and
Delivery.
(i) Delivery
and payment for the Firm Shares shall be made at 10:00 a.m., Eastern time, on
the third (3rd)
Business Day following the date hereof (or the fourth (4th)
Business Day following the date hereof, if the Applicable Time is later than
4:30 p.m. Eastern time), or at such time as shall be agreed upon by the
Representative and the Company at the offices of Loeb & Loeb, LLP, counsel
to the Underwriters (“Loeb & Loeb
LLP”), or at such other place (or remotely by facsimile or other
electronic transmission) as shall be agreed upon by the Representative and the
Company. The hour and date of delivery and payment for the Firm Shares is called
the “Closing
Date.”
(ii) Payment
for the Firm Shares shall be made on the Closing Date by wire transfer in
Federal (same day) funds, payable to the order of the Company upon delivery of
the certificates (in form and substance satisfactory to the Underwriters)
representing the Firm Shares (or upon delivery of the Firm Shares through the
facilities of the Depository Trust Company (“DTC”)) for the
account of the Underwriters. The Firm Shares shall be registered in such name or
names and in such authorized denominations as the Representative may request in
writing at least two (2) full Business Days prior to the Closing Date. The
Company shall not be obligated to sell or deliver the Firm Shares except upon
tender of payment by the Representative for all the Firm Shares. The term “Business Day” means
any day other than a Saturday, a Sunday or a legal holiday or a day on which
banking institutions are authorized or obligated by law to close in New York
City.
Funtalk
China Holdings Limited
____________,
2009
Page 2
of 24
1.2 Over-allotment
Option.
1.2.1. Option
Shares. For the purposes of covering any over-allotments in
connection with the distribution and sale of the Firm Shares, the Underwriters
are hereby granted, an option to purchase up to [_______] Shares representing
fifteen (15%) percent of the Firm Shares sold in the offering from the Company
(the “Over-allotment
Option”). Such additional
[ ]
Shares are hereinafter referred to as “Option Shares.” The
purchase price to be paid for the Option Shares will be the same price per
Option Share as the price per Firm Shares set forth in Section 1.1.1 hereof. The
Firm Shares and the Option Shares are hereinafter referred to collectively as
the “Public Securities.”
1.2.2. Exercise of
Option. The Over-allotment Option granted pursuant to Section
1.2.1 hereof may be exercised by the Representative as to all (at any time) or
any part (from time to time) of the Option Shares within 45 days after the
Effective Date. The Underwriters will not be under any obligation to purchase
any Option Shares prior to the exercise of the Over-allotment Option. The
Over-allotment Option granted hereby may be exercised by the giving of oral
notice to the Company from the Representative, which must be confirmed in
writing by overnight mail or facsimile or other electronic transmission setting
forth the number of Option Shares to be purchased and the date and time for
delivery of and payment for the Option Shares (the “Option Closing
Date”), which will not be later than five (5) full Business Days after
the date of the notice or such other time as shall be agreed upon by the Company
and the Representative, at the offices of Loeb & Loeb LLP or at such other
place (including remotely by facsimile or other electronic transmission) as
shall be agreed upon by the Company and the Representative. If such delivery and
payment for the Option Shares does not occur on the Closing Date, the Option
Closing Date will be as set forth in the notice. Upon exercise of the
Over-allotment Option, the Company will become obligated to convey to the
Underwriters, and, subject to the terms and conditions set forth herein, the
Underwriters will become obligated to purchase, the number of Option Shares
specified in such notice.
1.2.3. Payment and
Delivery. Payment for the Option Shares will be made on the
Option Closing Date by wire transfer in Federal (same day) funds as follows:
$[ ]
per Option Xxxxx, [00 % of the per Option Share offering price], shall be
deposited in the Company’s account and the remaining proceeds shall be paid to
the order of the Company upon delivery to you of certificates (in form and
substance satisfactory to the Representative) representing the Option Shares (or
through the facilities of DTC) for the account of the Underwriters. The Option
Shares shall be registered in such name or names and in such authorized
denominations as the Representative may request in writing at least two (2) full
Business Days prior to the Option Closing Date. The Company shall not be
obligated to sell or deliver the Option Shares except upon tender of payment by
the Representative for the applicable Option Shares.
1.3 Intentionally
omitted.
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2.
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Representations and
Warranties of the Company. The Company represents and
warrants to the Underwriters as
follows:
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2.1 Filing of Xxxxxxxxxxxx
Xxxxxxxxx.
0
Xxxxxxx
Xxxxx Holdings Limited
____________,
2009
Page 3
of 24
2.1.1. Pursuant to the
Act. The Company has filed with the Securities and Exchange
Commission (the “Commission”) a
registration statement and an amendment or amendments thereto, on Form S-1 (File
No. 333-162617), including any related prospectus or prospectuses, for the
registration of the Public Securities under the Securities Act of 1933, as
amended (the “Act”), which
registration statement and amendment or amendments have been prepared by the
Company in all material respects in conformity with the requirements of the Act
and the rules and regulations of the Commission under the Act (the “Regulations”). Such
registration statement on file with the Commission at the time the registration
statement becomes effective (including the prospectus, financial statements,
schedules, exhibits and all other documents filed as a part thereof or
incorporated therein and all information deemed to be a part thereof as of the
Effective Date pursuant to paragraph (b) of Rule 430A of the Regulations), is
referred to herein as the “Registration
Statement.” The final prospectus in the form first furnished to the
Underwriters for use in the Offering, is hereinafter called the “Prospectus.” The
Registration Statement has been declared effective by the Commission on the date
hereof. “Applicable
Time” means [___ am/pm on _________________, 2009], on the Effective Date
or such other time as agreed to by the Company and the
Representative.
2.1.2. Pursuant to the Exchange
Act. The Company has filed with the Commission a Form 8-A
(File Number 000-___) providing for the registration under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), of the Firm Shares, and
the Option Shares. The registration of the Firm Shares and the Option Shares
under the Exchange Act has been declared effective by the Commission on the date
hereof.
2.2 No Stop Orders,
etc. Neither the Commission nor, to the best of the Company’s
knowledge, any state regulatory authority has issued any order preventing or
suspending the use of the Prospectus or the Registration Statement or has
instituted or, to the best of the Company’s knowledge, threatened to institute
any proceedings with respect to such an order.
2.3 Disclosures in Registration
Statement.
2.3.1. 10b-5
Representation. At the respective times the Registration
Statement, the Prospectus and any post-effective amendments thereto become
effective (and at the Closing Date and the Option Closing Date, if
any):
(i) The
Registration Statement, the Prospectus and any post-effective amendments thereto
did and will contain all material statements that are required to be stated
therein in accordance with the Act and the Regulations, and will in all material
respects conform to the requirements of the Act and the
Regulations;
(ii) Neither
the Registration Statement nor the Prospectus, nor any amendment or supplement
thereto, nor any Permitted Free Writing Prospectus (as hereinafter defined), on
such dates, do or will contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading. The representation and warranty made in this Section
2.3.1(ii) does not apply to statements made or statements omitted in reliance
upon and in conformity with written information furnished to the Company with
respect to the Underwriters by the Representative expressly for use in the
Registration Statement or Prospectus or any amendment thereof or supplement
thereto. The parties acknowledge and agree that such information provided by or
on behalf of any Underwriter consists solely of the names of the Underwriters
appearing in the “Underwriting” section of the Prospectus and the following
additional disclosure contained in the “Underwriting” section of the Prospectus:
(i) the first paragraph under the heading “Pricing of Securities,” and (ii) the
paragraph under the heading “Other Terms.”
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Funtalk
China Holdings Limited
____________,
2009
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2.3.2. Disclosure of
Agreements. The agreements and documents described in the
Prospectus, the Registration Statement conform to the descriptions thereof
contained therein and there are no agreements or other documents required by the
Act and the Regulations to be described in the Prospectus, the Registration
Statement or to be filed with the Commission as exhibits to the Registration
Statement, that have not been so described or filed. Each agreement or other
instrument (however characterized or described) to which the Company is a party
or by which it is or may be bound or affected and (i) that is referred to
in the Prospectus, or (ii) is material to the Company’s business, has been
duly authorized and validly executed by the Company, is in full force and effect
in all material respects and is enforceable against the Company and, to the
Company’s knowledge, the other parties thereto, in accordance with its terms,
except (x) as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally,
(y) as enforceability of any indemnification or contribution provision may
be limited under the federal and state securities laws, and (z) that the
remedy of specific performance and injunctive and other forms of equitable
relief may be subject to the equitable defenses and to the discretion of the
court before which any proceeding therefore may be brought. Except as described
in the Prospectus, none of such agreements or instruments has been assigned by
the Company, and neither the Company nor, to the best of the Company’s
knowledge, any other party is in default thereunder and, to the best of the
Company’s knowledge, no event has occurred that, with the lapse of time or the
giving of notice, or both, would constitute a default thereunder, except to the
extent any such default or assignment would not reasonably be expected,
singularly or in the aggregate, to have a material adverse effect on the assets,
business or operations of the Company and its subsidiaries (“Material Adverse
Effect”). To the best of the Company’s knowledge, performance by the Company of
the material provisions of such agreements or instruments will not result in a
violation of any existing applicable law, rule, regulation, judgment, order or
decree of any governmental agency or court, domestic or foreign, having
jurisdiction over the Company or any of its assets or businesses, including,
without limitation, those relating to environmental laws and
regulations.
2.3.3. Prior Securities
Transactions. No securities of the Company have been sold by
the Company or by or on behalf of, or for the benefit of, any person or persons
controlling, controlled by, or under common control with the Company, except as
disclosed in the Registration Statement.
2.3.4. Regulations. The
disclosures in the Registration Statement concerning the effects of Federal,
State, local and all foreign regulation on the Company’s business as currently
contemplated are correct in all material respects.
2.4 Changes After Dates in
Registration Statement.
2.4.1. No Material Adverse
Change. Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as otherwise
specifically stated therein: (i) there has been no material adverse change
in the condition, financial or otherwise, or business prospects of the Company;
(ii) there have been no material transactions entered into by the Company,
other than as contemplated pursuant to this Agreement; and (iii) no
executive officer or director of the Company has resigned from his or her
position with the Company.
2.4.2. Recent Transactions,
etc. Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus, and
except as may otherwise be indicated or contemplated herein or disclosed in the
Registration Statement and the Prospectus, the Company has not: (i) issued
any securities or incurred any material liability or obligation, direct or
contingent, for borrowed money other than in the ordinary course of business;
(ii) entered into any material transaction other than in the ordinary
course of business, or (iii) declared or paid any dividend or made any other
distribution on or in respect to its capital stock, or (iv) modified any grants
under any stock compensation plan.
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Funtalk
China Holdings Limited
____________,
2009
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of 24
2.4.3. Recent Events. The
Company has not sustained, since the date of the latest audited financial
statements included or incorporated by reference in the Registration Statement,
any material loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus ; and, since such date, there has not
been any change in the capital stock or long-term debt of the Company or any of
its subsidiaries, or any material adverse changes, or any development involving
a prospective material adverse change, in or affecting the business, assets,
general affairs, management, financial position, prospects, stockholders’ equity
or results of operations of the Company and its subsidiaries taken as a whole,
otherwise than as set forth or contemplated in the Prospectus.
2.5 Independent
Accountants. To the knowledge of the Company, Deloitte Touche
Tohmatsu (“DTT”), whose report
is filed with the Commission as part of the Registration Statement, are
independent registered public accountants as required by the Act and the
Regulations. DTT has not, during the periods covered by the financial statements
included in the Prospectus, provided to the Company any non-audit services, as
such term is used in Section 10A(g) of the Exchange Act.
2.6 Financial Statements,
etc. The financial statements, including the notes thereto and
supporting schedules included in the Registration Statement and Prospectus
fairly present the financial position and the results of operations of the
Company at the dates and for the periods to which they apply; and such financial
statements have been prepared in conformity with generally accepted accounting
principles in the Unites States (“GAAP”), consistently
applied throughout the periods involved; except as disclosed therein; and the
supporting schedules included in the Registration Statement present fairly the
information required to be stated therein. The Registration Statement discloses
all material off-balance sheet transactions, arrangements, obligations
(including contingent obligations), and other relationships of the Company with
unconsolidated entities or other persons that may have a material current or
future effect on the Company’s financial condition, changes in financial
condition, results of operations, liquidity, capital expenditures, capital
resources, or significant components of revenues or
expenses.
2.7 Authorized Capital; Options,
etc. The Company had, at the date or dates indicated in the
Prospectus, the duly authorized, issued and outstanding capitalization as set
forth in the Registration Statement and the Prospectus. Based on the assumptions
stated in the Registration Statement and the Prospectus, the Company will have
on the Closing Date the adjusted stock capitalization set forth therein. Except
as set forth in, or contemplated by, the Registration Statement and the
Prospectus, on the Effective Date there were not and on the Closing Date, there
will not be any outstanding options, warrants, or other rights to purchase or
otherwise acquire any authorized, but unissued Shares of the Company or any
security convertible into Shares of the Company, or any contracts or commitments
to issue or sell Shares or any such options, warrants, rights or convertible
securities.
2.8 Valid Issuance of
Securities, etc.
2.8.1. Outstanding
Securities. All issued and outstanding securities of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable; the holders thereof have no rights of rescission with respect
thereto, and are not subject to personal liability by reason of being such
holders; and none of such securities were issued in violation of the preemptive
rights of any holders of any security of the Company or similar contractual
rights granted by the Company. The authorized Shares conform in all material
respects to all statements relating thereto contained in the Registration
Statement and the Prospectus. The offers and sales of the outstanding Shares
were at all relevant times either registered under the Act and the applicable
state securities or Blue Sky laws or, based in part on the representations and
warranties of the purchasers of such Shares, exempt from such registration
requirements.
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Funtalk
China Holdings Limited
____________,
2009
Page
6 of 24
2.8.2. Securities Sold Pursuant to
this Agreement. The Public Securities have been duly
authorized for issuance and sale and, when issued and paid for, will be validly
issued, fully paid and non-assessable; the holders thereof are not and will not
be subject to personal liability by reason of being such holders; the Public
Securities are not and will not be subject to the preemptive rights of any
holders of any security of the Company or similar contractual rights granted by
the Company; and all corporate action required to be taken for the
authorization, issuance and sale of the Public Securities has been duly and
validly taken. The Public Securities conform in all material respects to all
statements with respect thereto contained in the Registration
Statement.
2.9 Registration Rights of Third
Parties. Except as set forth in the Registration Statement and
the Prospectus, no holders of any securities of the Company or any rights
exercisable for or convertible or exchangeable into securities of the Company
have the right to require the Company to register any such securities of the
Company under the Act or to include any such securities in a registration
statement to be filed by the Company.
2.10 Validity and Binding Effect
of Agreements. This Agreement has been duly and validly
authorized by the Company, and, when executed and delivered, will constitute,
the valid and binding agreement of the Company, enforceable against the Company
in accordance with its respective terms, except: (i) as such enforceability
may be limited by bankruptcy, insolvency, reorganization or similar laws
affecting creditors’ rights generally; (ii) as enforceability of any
indemnification or contribution provision may be limited under the federal and
state securities laws; and (iii) that the remedy of specific performance
and injunctive and other forms of equitable relief may be subject to the
equitable defenses and to the discretion of the court before which any
proceeding therefore may be brought.
2.11 No Conflicts,
etc. The execution, delivery, and performance by the Company
of this Agreement, the consummation by the Company of the transactions
contemplated herein and the compliance by the Company with the terms hereof, do
not and will not, with or without the giving of notice or the lapse of time or
both: (i) result in a breach of, or conflict with any of the terms and
provisions of, or constitute a default under, or result in the creation,
modification, termination or imposition of any lien, charge or encumbrance upon
any property or assets of the Company pursuant to the terms of any agreement or
instrument to which the Company is a party; (ii) result in any violation of
the provisions of the amended and restated memorandum and articles of
association of the Company (as the same may be amended from time to time, the
“Articles of
Association”); or (iii) violate any existing applicable law, rule,
regulation, judgment, order or decree of any governmental agency or court,
domestic or foreign, having jurisdiction over the Company or any of its
properties or business constituted as of the date hereof, except in the case of
(i) and (iii), as would not reasonably be expected to have a Material Adverse
Effect..
2.12 No Defaults;
Violations. Except as disclosed in the Prospectus, (i) no
default exists in the due performance and observance of any term, covenant or
condition of any material license, contract, indenture, mortgage, deed of trust,
note, loan or credit agreement, or any other agreement or instrument evidencing
an obligation for borrowed money, or any other material agreement or instrument
to which the Company is a party or by which the Company may be bound or to which
any of the properties or assets of the Company is subject, and (ii) the Company
is not in violation of any term or provision of its Articles of Association, or
in violation of any franchise, license, permit, applicable law, rule,
regulation, judgment or decree of any governmental agency or court, domestic or
foreign, having jurisdiction over the Company or any of its properties or
businesses.
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Funtalk
China Holdings Limited
____________,
2009
Page
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2.13 Corporate Power; Licenses;
Consents.
2.13.1. Conduct of
Business. Except as described in the Registration Statement
and the Prospectus, the Company has all requisite corporate power and authority,
and has all necessary authorizations, approvals, orders, licenses, certificates
and permits of and from all governmental regulatory officials and bodies that it
needs as of the date hereof to conduct its business purpose as described in the
Prospectus, except where any failures to possess the same, singularly or in the
aggregate, would have a Material Adverse Effect. The disclosures in the
Registration Statement concerning the effects of federal, state, local and
foreign regulation on this Offering and the Company’s business as currently
contemplated are correct in all material respects.
2.13.2. Transactions Contemplated
Herein. The Company has all corporate power and authority to
enter into this Agreement and to carry out the provisions and conditions hereof,
and all consents, authorizations, approvals and orders required in connection
therewith have been obtained. No consent, authorization or order of, and no
filing with, any court, government agency or other body is required for the
valid issuance, sale and delivery of the Public Securities and the consummation
of the transactions and agreements contemplated by this Agreement, except with
respect to applicable federal and state securities laws and the rules and
regulations of the Financial Industry Regulatory Authority, Inc. (“FINRA”).
2.14 D&O
Questionnaires. To the Company’s knowledge, all information
contained in the questionnaires (the “Questionnaires”) completed by each of the
Company’s directors and officers immediately prior to the Offering (the “Insiders”) as well as
in the Lock-Up Agreement provided to the Underwriters is true and correct in all
respects and the Company has not become aware of any information which would
cause the information disclosed in the questionnaires completed by each Insider
to become inaccurate and incorrect.
2.15 Litigation; Governmental
Proceedings. There is no action, suit, proceeding, inquiry,
arbitration, investigation, litigation or governmental proceeding pending or, to
the Company’s knowledge, threatened against, or involving the Company or, to the
Company’s knowledge, any executive officer or director which has not been
disclosed in the Registration Statement and the Prospectus or in connection with
the Company’s listing application for the listing of the Shares on the NASDAQ
Capital Market (“NASDAQ”), or which,
singularly or in the aggregate, if determined adversely to the Company, could
reasonably be expected to have a Material Adverse Effect; and to the best of the
Company’s knowledge, after reasonable investigation and due diligence inquiry,
no such proceedings are threatened or contemplated by governmental authorities
or threatened by others.
2.16 Good
Standing. The Company has been duly organized and is validly
existing as a corporation and is in good standing under the laws of the Cayman
Islands as of the date hereof, and is duly qualified to do business and is in
good standing in each jurisdiction in which its ownership or lease of property
or the conduct of business requires such qualification, except where the failure
to qualify would not have a Material Adverse Effect.
2.17 Transactions Affecting
Disclosure to XXXXX.
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Xxxxxxx
Xxxxx Holdings Limited
____________,
2009
Page
8 of 24
2.17.1. Finder’s
Fees. Except as described in the Registration Statement and
the Prospectus, there are no claims, payments, arrangements, agreements or
understandings relating to the payment of a finder’s, consulting or origination
fee by the Company or any of its directors or officers with respect to the sale
of the Public Securities hereunder or any other arrangements, agreements or
understandings of the Company or, to the Company’s knowledge, any of its
shareholders that may affect the Underwriters’ compensation, as determined by
FINRA.
2.17.2. Payments Within Twelve
Months. Except as described in the Registration Statement and
the Prospectus, the Company has not made any direct or indirect payments (in
cash, securities or otherwise) to: (i) any person, as a finder’s fee,
consulting fee or otherwise, in consideration of such person raising capital for
the Company or introducing to the Company persons who raised or provided capital
to the Company; (ii) to any FINRA member; or (iii) to any person or
entity that has any direct or indirect affiliation or association with any FINRA
member, within the twelve months prior to the Effective Date.
2.17.3. Use of
Proceeds. None of the net proceeds of the Offering will be
paid by the Company to any participating FINRA member or its affiliates, except
as specifically authorized herein.
2.17.4. FINRA
Affiliation. To the Company’s knowledge, no officer, director
or any 5% ore greater beneficial owner of the Company’s unregistered securities
has any direct or indirect affiliation or association with any FINRA member (as
determined in accordance with the rules and regulations of FINRA). The Company
will advise the Representative and Loeb & Loeb LLP if it learns that any
officer, director or owner of at least 5% of the Company’s outstanding Shares
(or securities convertible into Shares) is or becomes an affiliate or associated
person of a FINRA member participating in the Offering.
2.18 Foreign Corrupt Practices
Act. Neither the Company nor any of the directors , employees
or officers of the Company or any other person acting on behalf of the Company
has, directly or indirectly, given or agreed to give any money, gift or similar
benefit (other than legal price concessions to customers in the ordinary course
of business) to any customer, supplier, employee or agent of a customer or
supplier, or official or employee of any governmental agency or instrumentality
of any government (domestic or foreign) or any political party or candidate for
office (domestic or foreign) or any political party or candidate for office
(domestic or foreign) or other person who was, is, or may be in a position to
help or hinder the business of the Company (or assist it in connection with any
actual or proposed transaction) that (i) might subject the Company to any
damage or penalty in any civil, criminal or governmental litigation or
proceeding, (ii) if not given in the past, might have had a material
adverse effect on the assets, business or operations of the Company as reflected
in any of the financial statements contained in the Prospectus or (iii) if
not continued in the future, might adversely affect the assets, business,
operations or prospects of the Company. The Company has taken reasonable steps
to ensure that its accounting controls and procedures are sufficient to cause
the Company to comply in all material respects with the Foreign Corrupt
Practices Act of 1977, as amended.
2.19 Officers’
Certificate. Any certificate signed by any duly authorized
officer of the Company and delivered to you or to Loeb & Loeb LLP shall be
deemed a representation and warranty by the Company to the Underwriters as to
the matters covered thereby.
2.20 Lock-up
Agreements. Each of the Company’s officers and directors and
any affiliated party of such officers and directors, in each case, who currently
hold 10% or more on a fully-diluted basis of the Company’s outstanding Shares
(collectively, the “Lock-Up Parties”)
have agreed pursuant to executed Lock-Up Agreements in the form attached hereto
as Exhibit 1 that for a period of 6 months, (the “Lock-Up Period”) from
the effective date of the Prospectus, such persons shall not sell, contract to
sell, grant any option for the sale or otherwise dispose of any of your equity
securities, or any securities convertible into or exercisable or exchangeable
for our equity securities, without the consent of the Representative. The
Representative may consent to an early release from the Lock-Up period if, in
its opinion, the market for the Shares would not be adversely impacted by sales
and in cases of financial emergency of an officer, director or other
stockholder. The Company has caused each of the Lock-Up Parties to deliver to
the Representative the agreements of each Lock-Up Parties to the foregoing
effect prior to the date that the Company requests that the Commission declare
the Registration Statement effective under the Act.
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China Holdings Limited
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2009
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2.21 Subsidiaries. Exhibit
21.1 to the Registration Statement sets forth the ownership of all direct and
indirect subsidiaries of the Company, including each entity disclosed or
described in the Registration Statement as being a subsidiary of the Company
(each a “Subsidiary” and
together the “Subsidiaries”). All
Subsidiaries of the Company are duly organized and in good standing under the
laws of their respective jurisdictions of organization or incorporation, and
each Subsidiary is in good standing in each jurisdiction in which its ownership
or lease of property or the conduct of business requires such qualification,
except where the failure to qualify would not have a Material Adverse
Effect.
2.22 Related Party
Transactions. There are no business relationships or related
party transactions involving the Company or any other person required to be
described in the Prospectus that have not been described as
required.
2.23 Board of
Directors. The Board of Directors of the Company is comprised
of the persons set forth under the heading of the Prospectus captioned
“Management.” The qualifications of the persons serving as board members and the
overall composition of the board comply with the Xxxxxxxx-Xxxxx Act of 2002 and
the rules promulgated thereunder applicable to the Company and the rules of
NASDAQ. At least one member of the Board of Directors of the Company qualifies
as a “financial expert” as such term is defined under the Xxxxxxxx-Xxxxx Act of
2002 and the rules promulgated thereunder and the rules of NASDAQ. In addition,
at least a majority of the persons serving on the Board of Directors qualify as
“independent” as defined under the rules of NASDAQ.
2.24 Xxxxxxxx-Xxxxx
Compliance.
2.24.1. Disclosure
Controls. The Company has developed and currently maintains
disclosure controls and procedures that will comply with Rule 13a-15 or 15d-15
of the Exchange Act, and such controls and procedures are effective to ensure
that all material information concerning the Company will be made known on a
timely basis to the individuals responsible for the preparation of the Company’s
Exchange Act filings and other public disclosure documents.
2.24.2. Compliance. The
Company is in compliance with the provisions of the Xxxxxxxx-Xxxxx Act of 2002
applicable to it in all material respects, and has implemented or will implement
such programs and taken reasonable steps to ensure the Company’s future
compliance (not later than the relevant statutory and regulatory deadlines
therefore) with all the material provisions of the Xxxxxxxx-Xxxxx Act of
2002.
2.25 Representations and
Warranties of the Company Regarding the People’s Republic of China
(“PRC”)
2.25.1. PRC
Subsidiaries. The Company conducts substantially all of its
operations and generates substantially all of its revenue through its indirect
subsidiary, Beijing Pypo Technology Group Company Limited (“Pypo Beijing”) and
the direct and indirect subsidiaries (of which 22 are wholly owned, one is 51%
owned and one is 50% owned) [all] incorporated in the PRC. The subsidiaries and
their affiliates listed on Schedule 2.26 hereto and listed and described in the
Registration Statement and the Prospectus (such subsidiaries and affiliates
along with Pypo Beijing, collectively shall be referred to herein as the “PRC
Subsidiaries”);
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2.25.2. Each
of the PRC Subsidiaries has been duly established, is validly existing as a
company in good standing under the laws of the PRC, has the corporate power and
authority to own, lease and operate its property and to conduct its business as
described in the Registration Statement, the Time of Sale Disclosure Package and
the Prospectus, and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing is not
reasonably likely to result in a material adverse effect on the assets, business
or financial condition of the Company. Each of the PRC Subsidiaries
has applied for and obtained all requisite business licenses, clearance and
permits required under the laws and regulations of the PRC as necessary for the
conduct of its businesses, and each of the PRC Subsidiaries has complied in all
material respects with all laws and regulations of the PRC in connection with
foreign exchange. The registered capital of each of the PRC
Subsidiaries has been fully paid up in accordance with the schedule of payment
stipulated in its respective articles of association, approval document,
certificate of approval and legal person business license (hereinafter referred
to as the “Establishment
Documents”) and in compliance with the PRC laws and regulations, and
there is no outstanding capital contribution commitment for any of the PRC
Subsidiaries. The Establishment Documents of the PRC Subsidiaries
have been duly approved in accordance with the laws of the PRC and are valid and
enforceable. The business scope specified in the Establishment
Documents of each of the PRC Subsidiaries complies with the requirements of all
relevant the PRC laws and regulations. The outstanding equity
interests of each of the PRC Subsidiaries is owned of record by the Company or a
wholly owned subsidiary, except for such specific entities or individuals
identified as the registered holders thereof in the Registration Statement and
the Prospectus. The Company possesses, directly or indirectly, the
power to direct, or cause the direction of, the management and policies of the
PRC Subsidiaries.
2.25.3. Dividends. No
PRC Subsidiary is currently prohibited, directly or indirectly, from paying any
dividends to the Company (or the Company’s subsidiary that holds the outstanding
equity interest of such PRC Subsidiary). No PRC Subsidiary is prohibited,
directly or indirectly, from making any other distribution on such PRC
Subsidiary’s equity capital, from repaying to the Company any loans or advances
to such the PRC Subsidiary from the Company or any of the Company’s
Subsidiaries.
2.25.4. Immunity. None
of the PRC Subsidiaries nor any of their properties, assets or revenues are
entitled to any right of immunity on the grounds of sovereignty from any legal
action, suit or proceeding, from set-off or counterclaim, from the jurisdiction
of any court, from services of process, from attachment prior to or in aid of
execution of judgment, or from any other legal process or proceeding for the
giving of any relief or for the enforcement of any judgment.
2.25.5. Filing with the
PRC. It is not necessary that this Agreement, the Registration
Statement, the Prospectus or any other document be filed or recorded with any
governmental agency, court or other authority in the PRC.
2.25.6. Transfer Taxes. No
transaction, stamp, capital or other issuance, registration, transaction,
transfer or withholding taxes or duties are payable in the PRC by or on behalf
of the Underwriters to any the PRC taxing authority in connection with
(i) the issuance, sale and delivery of any Shares by the Company and the
delivery of any Shares to or for the account of the Underwriters, (ii) the
purchase from the Company and the initial sale and delivery by the Underwriter
of any Shares to purchasers thereof, or (iii) the execution and delivery of
this Agreement.
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2.25.7. Compliance. The
Company has taken all necessary steps to ensure compliance by each of its
shareholders, option holders, directors, officers and employees that is, or is
directly or indirectly owned or controlled by, a the PRC resident or citizen
with any applicable rules and regulations of the relevant the PRC government
agencies.
2.25.8. PRC
Approvals. The issuance and sale of the Public Securities to
the underwriters, the listing and trading of the Public Securities on the NASDAQ
Capital Market and the consummation of the other transactions contemplated by
this Agreement, the Registration Statement and the Prospectus are not and will
not be, as of the date hereof and on the Closing Date, subject to any approval
by any the PRC governmental or regulatory authority.
2.25.9. PRC Tax Benefits,
etc. Any the PRC governmental tax benefits, exemptions,
waivers, or other relief, enjoyed by any the PRC Subsidiary as described in the
Registration Statement and the Prospectus are valid, binding and enforceable and
in accordance with the PRC law and regulations.
2.26 No Investment Company
Status. The Company is not and, after giving effect to the
Offering and sale of the Firm Shares and the application of the proceeds thereof
as described in the Registration Statement and the Prospectus, will not be,
required to register as an “investment company” as defined in the Investment
Company Act of 1940, as amended.
2.27 No Labor
Disputes. No labor dispute with the employees of the Company
or, to the knowledge of the Company, is imminent.
2.28 Intellectual
Property. The Company and each of its subsidiaries owns or
possesses or has valid right to use all patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service xxxx
registrations, copyrights, licenses, inventions, trade secrets and similar
rights (“Intellectual
Property”) necessary for the conduct of the business of the Company and
its subsidiaries as currently carried on and as described in the Registration
Statement and the Prospectus. To the knowledge of the Company, no
action or use by the Company or any of its subsidiaries will involve or give
rise to any infringement of, or license or similar fees for, any Intellectual
Property of others. Neither the Company nor any of its subsidiaries
has received any notice alleging any such infringement or fee.
2.29 Taxes. Each
of the Company and its subsidiaries has filed all returns (as hereinafter
defined) required to be filed with taxing authorities prior to the date hereof
or has duly obtained extensions of time for the filing thereof. Each
of the Company and its subsidiaries has paid all taxes (as hereinafter defined)
shown as due on such returns that were filed and has paid all taxes imposed on
or assessed against the Company or such respective subsidiary. The
provisions for taxes payable, if any, shown on the financial statements filed
with or as part of the Registration Statement are sufficient for all accrued and
unpaid taxes, whether or not disputed, and for all periods to and including the
dates of such consolidated financial statements. Except as disclosed
in writing to the Representative, (i) no issues have been raised (and are
currently pending) by any taxing authority in connection with any of the returns
or taxes asserted as due from the Company or its subsidiaries, and (ii) no
waivers of statutes of limitation with respect to the returns or collection of
taxes have been given by or requested from the Company or its
subsidiaries. The term “taxes” mean all
federal, state, local, foreign, and other net income, gross income, gross
receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease,
service, service use, withholding, payroll, employment, excise, severance,
stamp, occupation, premium, property, windfall profits, customs, duties or other
taxes, fees, assessments, or charges of any kind whatever, together with any
interest and any penalties, additions to tax, or additional amounts with respect
thereto. The term “returns” means all
returns, declarations, reports, statements, and other documents required to be
filed in respect to taxes.
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3.
|
Covenants of the
Company. The Company covenants and agrees as
follows:
|
3.1 Amendments to Registration
Statement. The Company will deliver to the Representative,
prior to filing, any amendment or supplement to the Registration Statement or
Prospectus proposed to be filed after the Effective Date and not file any such
amendment or supplement to which the Representative shall reasonably
object.
3.2 Federal Securities
Laws.
3.2.1. Compliance. During
the time when a Prospectus is required to be delivered under the Act, the
Company will use its best efforts to comply with all requirements imposed upon
it by the Act, the Regulations and the Exchange Act and by the regulations under
the Exchange Act, as from time to time in force, so far as necessary to permit
the continuance of sales of or dealings in the Public Securities in accordance
with the provisions hereof and the Prospectus. If at any time when a Prospectus
relating to the Public Securities is required to be delivered under the Act, any
event shall have occurred as a result of which, in the opinion of counsel for
the Company or counsel for the Underwriters, the Prospectus, as then amended or
supplemented, includes an untrue statement of a material fact or omits to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or if it is necessary at any time to amend the Prospectus to
comply with the Act, the Company will notify the Representative promptly and
prepare and file with the Commission, subject to Section 3.1 hereof, an
appropriate amendment or supplement in accordance with Section 10 of the
Act.
3.2.2. Filing of Final
Prospectus. The Company will file the Prospectus (in form and
substance satisfactory to the Representative) with the Commission pursuant to
the requirements of Rule 424 of the Regulations.
3.2.3. Free Writing
Prospectuses. The Company represents and agrees that it has
not made and will not make any offer relating to the Public Securities that
would constitute an issuer free writing prospectus, as defined in Rule 433 of
the 1933 Act, without the prior consent of the Representative. Any such free
writing prospectus consented to by the Representative is hereinafter referred to
as a “Permitted Free
Writing Prospectus.” The Company represents that its will treat each
Permitted Free Writing Prospectus as an “issuer free writing prospectus” as
defined in Rule 433, and has complied and will comply with the applicable
requirements of Rule 433 of the 1933 Act, including timely Commission filing
where required, legending and record keeping.
3.3 Delivery to the Underwriters
of Prospectuses. The Company will deliver to each of several
Underwriters, without charge, from time to time during the period when the
Prospectus is required to be delivered under the Act or the Exchange Act such
number of copies of each Prospectus as such Underwriters may reasonably request
and, as soon as the Registration Statement or any amendment or supplement
thereto becomes effective, deliver to you two original executed Registration
Statements, including exhibits, and all post-effective amendments thereto and
copies of all exhibits filed therewith or incorporated therein by reference and
all original executed consents of certified experts.
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3.4 Effectiveness and Events
Requiring Notice to the Representative. The Company will use
its best efforts to cause the Registration Statement to remain effective with a
current prospectus for at least nine (9) months from the Applicable Time. and
will notify the Representative immediately and confirm the notice in writing:
(i) of the effectiveness of the Registration Statement and any amendment
thereto; (ii) of the issuance by the Commission of any stop order or of the
initiation, or the threatening, of any proceeding for that purpose;
(iii) of the issuance by any state securities commission of any proceedings
for the suspension of the qualification of the Public Securities for offering or
sale in any jurisdiction or of the initiation, or the threatening, of any
proceeding for that purpose; (iv) of the mailing and delivery to the
Commission for filing of any amendment or supplement to the Registration
Statement or Prospectus; (v) of the receipt of any comments or request for
any additional information from the Commission; and (vi) of the happening
of any event during the period described in this Section 3.4 hereof that, in the
judgment of the Company, makes any statement of a material fact made in the
Registration Statement or the Prospectus untrue or that requires the making of
any changes in the Registration Statement or the Prospectus in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. If the Commission or any state securities commission shall enter
a stop order or suspend such qualification at any time, the Company will make
every reasonable effort to obtain promptly the lifting of such
order.
3.5 Accountants. The
Company shall retain an independent public accountants reasonably acceptable to
the Representative, and the Company shall continue to retain a nationally
recognized independent certified public accounting firm. Deloitte
Touche Tohmatsu is acceptable to the Representative.
3.6 Transfer
Agent. For a period of three years from the Effective Date,
the Company shall retain a transfer and registrar agent acceptable to the
Representative (the “Transfer Agent”) and
will furnish to the Representative at the Company’s sole cost and expense such
transfer sheets of the Company’s securities as the Representative may reasonably
request, including the daily and monthly consolidated transfer sheets of the
Transfer Agent and DTC. Continental Stock Transfer and Trust Company is
acceptable to the Representative to act as Transfer Agent for the Company’s
Shares.
3.7 Trading
Reports. During such time as the Public Securities are listed
on NASDAQ, the Company shall provide to the Representative, at the Company’s
expense, such reports published by the NASDAQ relating to price trading of the
Public Securities, as the Representative shall reasonably request.
3.8 Payment of
Expenses.
3.8.1. General Expenses Related to
the Offering. The Company hereby agrees to pay on each of the
Closing Date and the Option Closing Date, if any, to the extent not paid at the
Closing Date, all expenses incident to the performance of the obligations of the
Company under this Agreement, including, but not limited to: (a) all filing fees
and communication expenses relating to the registration of the Shares to be sold
in the Offering (including the Over-allotment Shares) with the Commission; (b)
all COBRA Desk filing fees associated with the review of the Offering by FINRA;
all fees and expenses relating to the listing of such Shares on the NASDAQ
Capital Market, the NASDAQ National Market or the NYSE Amex and on such other
stock exchanges as the Company and the Representative together determine; (c)
all fees, expenses and disbursements relating to background checks of
the Company’s officers and directors in an amount not to exceed $5,000 per
individual; (d) the reasonable fees and disbursements of the Underwriters’
counsel in excess of $200,000, as incurred, which excess is currently estimated
to be in a range of $100,000–$125,000 but will depend on the actual fees and
disbursements of such counsel in connection with the Offering, (e) all fees,
expenses and disbursements relating to the registration or qualification of such
Shares under the “blue sky” securities laws of such states and other
jurisdictions as the Representative may reasonably designate (including, without
limitation, all filing and registration fees, and the reasonable fees and
disbursements of the Representative’s counsel, it being agreed that if the
Offering is commenced on the Over the Counter Bulletin Board, the Company will
make a payment of $15,000 to such counsel upon the commencement of “blue sky”
work by such counsel and an
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additional
$5,000 at Closing); (f) all fees, expenses and disbursements relating to the
registration, qualification or exemption of such Shares under the securities
laws of such foreign jurisdictions as the Representative may reasonably
designate; (g) the costs of all mailing and printing of the underwriting
documents (including, without limitation, the Underwriting Agreement, any Blue
Sky Surveys and, if appropriate, any Agreement Among Underwriters, Selected
Dealers’ Agreement, Underwriters’ Questionnaire and Power of Attorney),
Registration Statements, Prospectuses and all amendments, supplements and
exhibits thereto and as many preliminary and final Prospectuses as the
Representative may reasonably deem necessary, (h) the costs and expenses of the
public relations firm; (i) the costs of preparing, printing and delivering
certificates representing the Shares; (j) fees and expenses of the transfer
agent for the Shares; (k) stock transfer and/or stamp taxes, if any, payable
upon the transfer of securities from the Company to the Underwriters; (1) the
costs associated with bound volumes of the public offering materials as well as
commemorative mementos and lucite tombstones, each of which the Company or its
designee will provide within a reasonable time after the Closing in such
quantities as the Representative may reasonably request; (m) the fees and
expenses of the Company’s accountants; (n) the fees and expenses of the
Company’s legal counsel and other agents and representatives; (o) the
Representative’s use of i-Deal’s book-building, prospectus tracking and
compliance software for the Offering; (p) the Underwriters’ actual “road show”
expenses for the Offering; and (q) the Underwriters’ costs of mailing
prospectuses to prospective investors. All relevant expenses incurred by the
Underwriter in items (1), (o), (p) and (q) of this Section will be borne by the
Company, up to but no more than $130,000; the remaining balance will be borne by
the Representative. The Representative may also deduct from the net proceeds of
the Offering payable to the Company on the Closing Date, or the Option Closing
Date, if any, the expenses set forth herein to be paid by the Company to the
Representative.
3.8.2. Intentionally
omitted.
3.9 Application of Net
Proceeds. The Company will apply the net proceeds from the
Offering received by it in a manner consistent with the application described
under the caption “Use Of Proceeds” in the Prospectus.
3.10 Delivery of Earnings
Statements to Security Holders. The Company will make
generally available to its security holders as soon as practicable, but not
later than the first day of the fifteenth full calendar month following the
Effective Date, an earnings statement (which need not be certified by
independent public or independent certified public accountants unless required
by the Act or the Regulations, but which shall satisfy the provisions of Rule
158(a) under Section 11(a) of the Act) covering a period of at least twelve
consecutive months beginning after the Effective Date.
3.11 Stabilization. Neither
the Company, nor, to its knowledge, any of its employees, directors or
shareholders (without the consent of the Representative) has taken or will take,
directly or indirectly, any action designed to or that has constituted or that
might reasonably be expected to cause or result in, under the Exchange Act, or
otherwise, stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares.
3.12 Internal
Controls. The Company will maintain a system of internal
accounting controls sufficient to provide reasonable assurances that:
(i) transactions are executed in accordance with management’s general or
specific authorization; (ii) transactions are recorded as necessary in
order to permit preparation of financial statements in accordance with GAAP and
to maintain accountability for assets; (iii) access to assets is permitted
only in accordance with management’s general or specific authorization; and
(iv) the recorded accountability for assets is compared with existing
assets at reasonable intervals and appropriate action is taken with respect to
any differences.
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3.13 FINRA. The
Company shall advise the Representative (who shall make an appropriate filing
with FINRA) if it is aware that any 5% or greater shareholder of the Company
becomes an affiliate or associated person of an FINRA member participating in
the distribution of the Company’s Public Securities.
3.14 No Fiduciary
Duties. The Company acknowledges and agrees that the
Underwriters’ responsibility to the Company is solely contractual in nature and
that none of the Underwriters or their affiliates or any Selling Agent shall be
deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary
duty to the Company or any of its affiliates in connection with the Offering and
the other transactions contemplated by this Agreement.
4. Conditions of Underwriters’
Obligations. The obligations of the several Underwriters to
purchase and pay for the Shares, as provided herein, shall be subject to the
continuing accuracy of the representations and warranties of the Company as of
the date hereof and as of each of the Closing Date and the Option Closing Date,
if any, to the accuracy of the statements of officers of the Company made
pursuant to the provisions hereof and to the performance by the Company of its
obligations hereunder and to the following conditions:
4.1 Regulatory
Matters.
4.1.1. Effectiveness of
Registration Statement. The Registration Statement shall have
become effective not later than 5:00 P.M., Eastern time, on the date of this
Agreement or such later date and time as shall be consented to in writing by
you, and, at each of the Closing Date and the Option Closing Date, no stop order
suspending the effectiveness of the Registration Statement shall have been
issued and no proceedings for that purpose shall have been instituted or shall
be pending or contemplated by the Commission and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of Loeb & Loeb LLP.
4.1.2. FINRA
Clearance. By the Effective Date, the Representative shall
have received clearance from FINRA as to the amount of compensation allowable or
payable to the Underwriters as described in the Registration
Statement.
4.1.3. NASDAQ Stock Market
Clearance. On the Closing Date, the Company’s Shares,
including the Firm Shares shall have been approved for listing on the
NASDAQ.
4.1.4. Free Writing
Prospectuses. The Representative covenants with the Company
that the Underwriters will not use, authorize the use of, refer to, or
participate in the planning for the use of a “free writing prospectus” as
defined in Rule 405 under the 1933 Act, which term includes use of any written
information furnished by the Commission to the Company and not incorporated by
reference into the Registration Statement, without the prior written consent of
the Company.
4.2 Company Counsel
Matters.
4.2.1. Closing Date Opinion of
Counsel. On the Closing Date, the Underwriters shall have
received the favorable opinion of Xxxxxx & Xxxxxxx, LLP, counsel to the
Company, reasonably acceptable to the Underwriters, covering the matters set
forth in Exhibit A.
4.2.2.
Cayman Islands
Opinion. On the Closing Date, the Underwriters shall have
received the favorable opinion of Xxxxxx and Calder, Cayman Islands counsel to
the Company, reasonably acceptable to the Underwriters, covering the matters set
forth in Exhibit X.
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4.2.3. PRC Opinion. On the
Closing Date, the Underwriters shall have received the favorable opinion of
HanKun Law Offices, PRC counsel to the Company, related to, among other things,
the descriptions of laws of the PRC and the organization of the Company’s PRC
Subsidiaries, affiliates and ownership structure, dated the Closing Date and
addressed to the Underwriters covering the matters set forth in Exhibit
A.
4.2.4. Hong Kong Subsidiary Counsel
Opinion. On the Closing Date, the Underwriters shall have
received the favorable opinion of [HK Counsel] counsel to the Company,
reasonably acceptable to the Underwriter, related to, among other things, the
descriptions of laws of _____________ and the organization of the Company’s Hong
Kong subsidiary and ownership structure, dated the Closing Date and addressed to
the Underwriters, covering the matters set forth in Exhibit C.
4.2.5. Option Closing Date Opinions
of Counsel. On the Option Closing Date, if any, the Representative shall
have received the favorable opinions of Xxxxxx & Xxxxxxx, Xxxxxx and Xxxxxx,
[HK Counsel] and HanKun Law Offices dated the Option Closing Date,
addressed to the Underwriters and in form and substance reasonably satisfactory
to the Representative, confirming as of the Option Closing Date, the statements
made by such firms in their respective opinions delivered on the Closing
Date.
4.2.6. Reliance. In
rendering such opinions, such counsel may rely: (i) as to matters involving
the application of laws other than the laws of the United States and
jurisdictions in which they are admitted, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an opinion
or opinions (in form and substance reasonably satisfactory to the
Representative) of other counsel reasonably acceptable to the Representative,
familiar with the applicable laws; and (ii) as to matters of fact, to the
extent they deem proper, on certificates or other written statements of officers
of the Company and officers of departments of various jurisdiction having
custody of documents respecting the corporate existence or good standing of the
Company, provided that copies of any such statements or certificates shall be
delivered to Loeb & Loeb LLP if requested. The opinions of Xxxxxx &
Xxxxxxx, Xxxxxx and Xxxxxx, [HK Counsel] and HanKun Law Offices shall include a
statement to the effect that it may be relied upon by counsel for the
Underwriters in its opinion delivered to the Underwriters.
4.3 Cold Comfort
Letter. At the time this Agreement is executed, and at each of
the Closing Date and the Option Closing Date, if any, you shall have received a
cold comfort letter, addressed to the Underwriters and in form and substance
satisfactory in all respects to the Representative and to Loeb & Loeb LLP
from DTT dated, respectively, as of the date of this Agreement and as of the
Closing Date and the Option Closing Date, if any.
4.4 Officers’
Certificates.
4.4.1. Officers’
Certificate. At each of the Closing Date and the Option
Closing Date, if any, the Representative shall have received a certificate of
the Company signed by the Chairman of the Board and Chief Executive Officer of
the Company, dated the Closing Date or the Option Closing Date, as the case may
be, respectively, to the effect that the Company has performed all covenants and
complied with all conditions required by this Agreement to be performed or
complied with by the Company prior to and as of the Closing Date, or the Option
Closing Date, as the case may be, and that the conditions set forth in Section
4.5 hereof have been satisfied as of such date and that, as of the Closing Date
and the Option Closing Date, as the case may be, the representations and
warranties of the Company set forth in Section 2 hereof are true and correct. In
addition, the Representative will have received such other and further
certificates of officers of the Company as the Representative may reasonably
request.
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4.4.2. Secretary’s
Certificate. At each of the Closing Date and the Option
Closing Date, if any, the Representative shall have received a certificate of
the Company signed by the Secretary or Assistant Secretary of the Company, dated
the Closing Date or the Option Date, as the case may be, respectively,
certifying: (i) that the Articles of Association are true and complete,
have not been modified and are in full force and effect; (ii) that the
resolutions of the Company’s Board of Directors relating to the public offering
contemplated by this Agreement are in full force and effect and have not been
modified; (iii) all correspondence between the Company or its counsel and
the Commission; and (iv) as to the incumbency of the officers of the
Company. The documents referred to in such certificate shall be attached to such
certificate.
4.5 No Material
Changes. Prior to and on each of the Closing Date and the
Option Closing Date, if any: (i) there shall have been no material adverse
change or development involving a prospective material adverse change in the
condition or prospects or the business activities, financial or otherwise, of
the Company from the latest dates as of which such condition is set forth in the
Registration Statement and Prospectus; (ii) no action suit or proceeding,
at law or in equity, shall have been pending or threatened against the Company
or any Insider before or by any court or federal or state commission, board or
other administrative agency wherein an unfavorable decision, ruling or finding
may materially adversely affect the business, operations, prospects or financial
condition or income of the Company, except as set forth in the Registration
Statement and Prospectus; (iii) no stop order shall have been issued under
the Act and no proceedings therefore shall have been initiated or threatened by
the Commission; and (iv) the Registration Statement and the Prospectus and
any amendments or supplements thereto shall contain all material statements
which are required to be stated therein in accordance with the Act and the
Regulations and shall conform in all material respects to the requirements of
the Act and the Regulations, and neither the Registration Statement nor the
Prospectus nor any amendment or supplement thereto shall contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
4.6 Delivery of
Agreements.
4.6.1. Effective Date
Deliveries. On the Effective Date, the Company shall have
delivered to the Representative executed copies of this Agreement and the
Lock-Up Agreements.
|
5.
|
Indemnification.
|
5.1 Indemnification of the
Underwriters.
5.1.1. General. Subject
to the conditions set forth below, the Company agrees to indemnify and hold
harmless each of the Underwriters, and each dealer selected by the
Representative that participates in the offer and sale of the Public Securities
(each a “Selected
Dealer”) and each of their respective directors, officers and employees
and each person, if any, who controls any such Underwriter (“Controlling Person”)
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
against any and all loss, liability, claim, damage and expense whatsoever
(including but not limited to any and all legal or other expenses reasonably
incurred in investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever, whether arising out of any
action between any of the Underwriters and the Company or between any of the
Underwriters and any third party or otherwise) to which they or any of them may
become subject under the Act, the Exchange Act or any other statute or at common
law or otherwise or under the laws of foreign countries, arising out of or based
upon
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China Holdings Limited
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any
untrue statement or alleged untrue statement of a material fact contained in (i)
any Preliminary Prospectus, the Registration Statement or the Prospectus (as
from time to time each may be amended and supplemented); (ii) any materials or
information provided to investors by, or with the approval of, the Company in
connection with the marketing of the offering of the Securities, including any
“road show” or investor presentations made to investors by the Company (whether
in person or electronically); or (iii) any application or other document or
written communication (in this Section 5, collectively called “application”)
executed by the Company or based upon written information furnished by the
Company in any jurisdiction in order to qualify the Public Shares under the
securities laws thereof or filed with the Commission, any state securities
commission or agency, NASDAQ or any securities exchange; or the omission or
alleged omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, unless such statement or omission
was made in reliance upon and in conformity with written information furnished
to the Company with respect to an Underwriter by or on behalf of such
Underwriter expressly for use in any Preliminary Prospectus, the Registration
Statement or Prospectus, or any amendment or supplement thereof, or in any
application, as the case may be. With respect to any untrue statement or
omission or alleged untrue statement or omission made in the Preliminary
Prospectus, the indemnity agreement contained in this paragraph shall not inure
to the benefit of any Underwriter to the extent that any loss, liability, claim,
damage or expense of such Underwriter results from the fact that a copy of the
Prospectus was not given or sent to the person asserting any such loss,
liability, claim or damage at or prior to the written confirmation of sale of
the Public Securities to such person as required by the Act and the Regulations,
and if the untrue statement or omission has been corrected in the Prospectus,
unless such failure to deliver the Prospectus was a result of non-compliance by
the Company with its obligations under Section 3.3 hereof. The Company agrees
promptly to notify the Representative of the commencement of any litigation or
proceedings against the Company or any of its officers, directors or controlling
persons in connection with the issue and sale of the Public Securities or in
connection with the Registration Statement or Prospectus.
5.1.2. Procedure. If
any action is brought against an Underwriter, a Selected Dealer or a Controlling
Person in respect of which indemnity may be sought against the Company pursuant
to Section 5.1.1, such Underwriter or such Selected Dealer shall promptly notify
the Company in writing of the institution of such action and the Company shall
assume the defense of such action, including the employment and fees of counsel
(subject to the reasonable approval of such Underwriter or such Selected Dealer,
as the case may be) and payment of actual expenses. Such Underwriter, such
Selected Dealer or Controlling Person shall have the right to employ its or
their own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of such Underwriter, such Selected Dealer or controlling
person unless (i) the employment of such counsel at the expense of the Company
shall have been authorized in writing by the Company in connection with the
defense of such action, or (ii) the Company shall not have employed counsel to
have charge of the defense of such action, or (iii) such indemnified party or
parties shall have reasonably concluded that there may be defenses available to
it or them which are different from or additional to those available to the
Company (in which case the Company shall not have the right to direct the
defense of such action on behalf of the indemnified party or parties), in any of
which events the reasonable fees and expenses of not more than one additional
firm of attorneys selected by the Underwriter (in addition to local counsel),
Selected Dealer and/or Controlling Person shall be borne by the Company.
Notwithstanding anything to the contrary contained herein, if any Underwriter,
Selected Dealer or controlling person shall assume the defense of such action as
provided above, the Company shall have the right to approve the terms of any
settlement of such action which approval shall not be unreasonably
withheld.
5.2 Indemnification of the
Company. Each Underwriter, severally and not jointly, agrees
to indemnify and hold harmless the Company, its directors, officers and
employees and agents who control the Company within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act against any and all loss, liability,
claim, damage and expense described in the foregoing indemnity from the Company
to the several Underwriters, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions made in any
Preliminary Prospectus, the Registration Statement or Prospectus or any
amendment or supplement thereto or in any application, in reliance upon, and in
strict conformity with, written information furnished to the Company with
respect to such Underwriter by or on behalf of the Underwriter expressly for use
in such Preliminary Prospectus, the Registration Statement or Prospectus or any
amendment or supplement thereto or in any such application. In case any action
shall be brought against the Company or any other person so indemnified based on
any Preliminary Prospectus, the Registration Statement or Prospectus or any
amendment or supplement thereto or any application, and in respect of which
indemnity may be sought against any Underwriter, such Underwriter shall have the
rights and duties given to the Company, and the Company and each other person so
indemnified shall have the rights and duties given to the several Underwriters
by the provisions of Section 5.1.2.
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China Holdings Limited
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5.3 Contribution.
5.3.1. Contribution
Rights. In order to provide for just and equitable
contribution under the Act in any case in which (i) any person entitled to
indemnification under this Section 5 makes claim for indemnification pursuant
hereto but it is judicially determined (by the entry of a final judgment or
decree by a court of competent jurisdiction and the expiration of time to appeal
or the denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that this Section 5 provides for
indemnification in such case, or (ii) contribution under the Act, the Exchange
Act or otherwise may be required on the part of any such person in circumstances
for which indemnification is provided under this Section 5, then, and in each
such case, the Company and the Underwriters shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
said indemnity agreement incurred by the Company and the Underwriters, as
incurred, in such proportions that the Underwriters are responsible for that
portion represented by the percentage that the underwriting discount appearing
on the cover page of the Prospectus bears to the initial offering price
appearing thereon and the Company is responsible for the balance; provided,
that, no person guilty of a fraudulent misrepresentation (within the meaning of
Section ll (f) of the Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. Notwithstanding the
provisions of this Section 5.3.1, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages that such Underwriter has otherwise
been required to pay in respect of such losses, liabilities, claims, damages and
expenses. For purposes of this Section, each director, officer and employee of
an Underwriter or the Company, as applicable, and each person, if any, who
controls an Underwriter or the Company, as applicable, within the meaning of
Section 15 of the Act shall have the same rights to contribution as such
Underwriter or the Company, as applicable.
5.3.2. Contribution
Procedure. Within fifteen days after receipt by any party to
this Agreement (or its representative) of notice of the commencement of any
action, suit or proceeding, such party will, if a claim for contribution in
respect thereof is to be made against another party (“contributing party”),
notify the contributing party of the commencement thereof, but the omission to
so notify the contributing party will not relieve it from any liability which it
may have to any other party other than for contribution hereunder. In case any
such action, suit or proceeding is brought against any party, and such party
notifies a contributing party or its representative of the commencement thereof
within the aforesaid fifteen days, the contributing party will be entitled to
participate therein with the notifying party and any other contributing party
similarly notified. Any such contributing party shall not be liable to any party
seeking contribution on account of any settlement of any claim, action or
proceeding effected by such party seeking contribution on account of any
settlement of any claim, action or proceeding effected by such party seeking
contribution without the written consent of such contributing party. The
contribution provisions contained in this Section are intended to supersede, to
the extent permitted by law, any right to contribution under the Act, the
Exchange Act or otherwise available. Each Underwriter’s obligations to
contribute pursuant to this Section 5.3 are several and not joint.
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6.
|
Default by an
Underwriter.
|
6.1 Default Not Exceeding 10% of
Firm Shares or Option Shares. If any Underwriter or
Underwriters shall default in its or their obligations to purchase the Firm
Shares or the Option Shares, if the Over-allotment Option is exercised,
hereunder, and if the number of the Firm Shares or Option Shares with respect to
which such default relates does not exceed in the aggregate 10% of the number of
Firm Shares or Option Shares that all Underwriters have agreed to purchase
hereunder, then such Firm Shares or Option Shares to which the default relates
shall be purchased by the non-defaulting Underwriters in proportion to their
respective commitments hereunder.
6.2 Default Exceeding 10% of
Firm Shares or Option Shares. In the event that the default
addressed in Section 6.1 relates to more than 10% of the Firm Shares or Option
Shares, you may in your discretion arrange for yourself or for another party or
parties to purchase such Firm Shares or Option Shares to which such default
relates on the terms contained herein. If, within one(1) Business Day
after such default relating to more than 10% of the Firm Shares or Option
Shares, you do not arrange for the purchase of such Firm Shares or Option
Shares, then the Company shall be entitled to a further period of one (1)
Business Day within which to procure another party or parties satisfactory to
you to purchase said Firm Shares or Option Shares on such terms. In
the event that neither you nor the Company arrange for the purchase of the Firm
Shares or Option Shares to which a default relates as provided in this Section
6, this Agreement will automatically be terminated by you or the Company without
liability on the part of the Company (except as provided in Sections 3.9 and 5
hereof) or the several Underwriters (except as provided in Section 5 hereof);
provided, however, that if such default occurs with respect to the Option
Shares, this Agreement will not terminate as to the Firm Shares; and provided
further that nothing herein shall relieve a defaulting Underwriter of its
liability, if any, to the other Underwriters and to the Company for damages
occasioned by its default hereunder.
6.3 Postponement of Closing
Date. In the event that the Firm Shares or Option Shares to which the
default relates are to be purchased by the non-defaulting Underwriters, or are
to be purchased by another party or parties as aforesaid, you or the Company
shall have the right to postpone the Closing Date or Option Closing Date for a
reasonable period but not in any event exceeding five (5) Business Days, in
order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus or in any other documents and
arrangements, and the Company agrees to file promptly any amendment to the
Registration Statement or the Prospectus that in the opinion of counsel for the
Underwriters may thereby be made necessary. The term “Underwriter” as used in
this Agreement shall include any party substituted under this Section 6 with
like effect as if it had originally been a party to this Agreement with respect
to such Securities.
|
7.
|
Additional
Covenants.
|
7.1 Board Composition and Board
Designations. The Company shall ensure that: (i) the
qualifications of the persons serving as board members and the overall
composition of the board comply with the Xxxxxxxx-Xxxxx Act of 2002 and the
rules promulgated thereunder and with the listing requirements of NASDAQ or any
other national securities exchange or national securities association, as the
case may be, in the event the Company seeks to have its Public Securities listed
on another exchange or quoted on an automated quotation system, and (ii) if
applicable, at least one member of the board of directors qualifies as a
“financial expert” as such term is defined under the Xxxxxxxx-Xxxxx Act of 2002
and the rules promulgated thereunder.
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China Holdings Limited
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7.2 Right of First
Refusal. The Company agrees that if the Shares are sold in
accordance with the terms of this Agreement, the Representative shall have an
irrevocable preferential right for a period of six (6) months from the date the
Offering is completed to purchase for its account or to sell for the account of
the Company, or any subsidiary of or successor to the Company any securities
(whether debt or equity or any combination thereof) of the Company or any such
subsidiary or successor which the Company or any such subsidiary or successor
may seek to sell whether with or without or through an underwriter, placement
agent or broker-dealer and whether pursuant to registration under the Act or
otherwise. The Company and any such subsidiary or successor will consult the
Representative with regard to any such proposed financing and will offer the
Representative the opportunity to purchase or sell any such securities on terms
not more favorable to the Company or any such subsidiary or successor, as the
case may be, than it or they can secure elsewhere. If the Representative fails
to accept such offer within 10 business days after the mailing of a notice
containing the material terms of the proposed financing proposal by registered
mail or overnight courier service addressed to the Representative, then the
Representative shall have no further claim or right with respect to the
financing proposal contained in such notice. If, however, the terms of such
financing proposal are subsequently modified in any material respect, the
preferential right referred to herein shall apply to such modified proposal as
if the original proposal had not been made. The Representative’s failure to
exercise its preferential right with respect to any particular proposal shall
not affect its preferential rights relative to future proposals. The Company
shall have the right, at its option, to designate the Representative as lead
underwriter or co-manager of any underwriting group or co-placement agent of any
proposed financing in satisfaction of its obligations hereunder, and the
Representative shall be entitled to receive as its compensation 50% of the
compensation payable to the underwriting or placement agent group when serving
as co-manager or co-placement agent and 33% of the compensation payable to the
underwriting or placement agent group when serving as co-manager or co-placement
agent with respect to a proposed financing in which there are three co-managing
or lead underwriters or co-placement agents.
7.3 Prohibition on Press
Releases and Public Announcements. The Company will not issue
press releases or engage in any other publicity, without the Representative’s
prior written consent, for a period ending at 5:00 p.m. Eastern time on the
first business day following the 40th day following the Closing Date, other than
normal and customary releases issued in the ordinary course of the Company’s
business.
|
8.
|
Effective Date of this
Agreement and Termination
Thereof.
|
8.1 Effective
Date. This Agreement shall become effective when both the
Company and the Representative have executed the same and delivered counterparts
of such signatures to the other party.
8.2 Termination. You
shall have the right to terminate this Agreement at any time prior to any
Closing Date, (i) if any domestic or international event or act or
occurrence has materially disrupted, or in your opinion will in the immediate
future materially disrupt, general securities markets in the United States; or
(ii) if trading on the New York Stock Exchange, the NASDAQ, the NASDAQ
Global Market or the NASDAQ Capital Market shall have been suspended or
materially limited, or minimum or maximum prices for trading shall have been
fixed, or maximum ranges for prices for securities shall have been required by
FINRA or by order of the Commission or any other government authority having
jurisdiction, or (iii) if the United States shall have become involved in a
new war or an increase in major hostilities, or (iv) if a banking
moratorium has been declared by a New York State or federal authority, or
(v) if a moratorium on foreign exchange trading has been declared which
materially adversely impacts the United States securities markets, or
(vi) if the Company shall have sustained a material loss by fire, flood,
accident, hurricane, earthquake, theft, sabotage or other calamity or malicious
act which, whether or not such loss shall have been insured, will, in your
opinion, make it inadvisable to proceed with the delivery of the Firm Shares or
Option Shares, or (vii) if the Company is in material breach of any of its
representations, warranties or covenants hereunder, or (viii) if the
Representative shall have become aware after the date hereof of such a material
adverse change in the conditions or prospects of the Company, or such adverse
material change in general market conditions as in the Representative’s judgment
would make it impracticable to proceed with the offering, sale and/or delivery
of the securities or to enforce contracts made by the Representative for the
sale of the securities.
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8.3 Expenses. Except
in the case of a default by the Underwriters, pursuant to Section 6.2 above, in
the event that this Agreement shall not be carried out for any reason
whatsoever, within the time specified herein or any extensions thereof pursuant
to the terms herein, the Company shall be obligated to pay to the Underwriters
their actual and accountable out of pocket expenses related to the transactions
contemplated herein then due and payable (including the fees and disbursements
of Loeb & Loeb LLP up to $__________).
8.4 Indemnification. Notwithstanding
any contrary provision contained in this Agreement, any election hereunder or
any termination of this Agreement, and whether or not this Agreement is
otherwise carried out, the provisions of Section 5 shall not be in any way
effected by, such election or termination or failure to carry out the terms of
this Agreement or any part hereof.
|
9.
|
Miscellaneous.
|
9.1 Notices. All
communications hereunder, except as herein otherwise specifically provided,
shall be in writing and shall be mailed (registered or certified mail, return
receipt requested), personally delivered or sent by facsimile transmission and
confirmed and shall be deemed given when so delivered or faxed and confirmed or
if mailed, two days after such mailing.
If to the
Representative:
Xxxxxx
& Xxxxxxx, LLC
0000
Xxxxxx xx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx,
XX 00000
Attn:
General Counsel
Fax No.:
000-000-0000
Copy
to:
Loeb
& Loeb LLP LLP
000 Xxxx
Xxxxxx
Xxx Xxxx,
XX 00000
Attn:
Xxxxxxxx X. Xxxxxxxx, Esq.
Fax:
000-000-0000
If to the
Company:
Funtalk
China Holdings Limited
South
3/F, Xxxxx’ An XingRong Center
Xx. 0
XxxXxxXxx Xxxxxx, XxXxxxx Xxxxxxxx
Xxxxxxx,
Xxxxx 100031
Attn:
22
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China Holdings Limited
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Copy
to:
Xxxxxx
& Xxxxxxx
00/X, Xxx
Xxxxxxxx Xxxxxx
0
Xxxxxxxxx Xxxxx
Xxxxxxx,
Xxxx Xxxx
Attn:
Xxxxx X. Xxxxx, Esq.
Facsimile:
(000) 0000-0000
9.2 Headings. The
headings contained herein are for the sole purpose of convenience of reference,
and shall not in any way limit or affect the meaning or interpretation of any of
the terms or provisions of this Agreement.
9.3 Amendment. This
Agreement may only be amended by a written instrument executed by each of the
parties hereto.
9.4 Entire
Agreement. This Agreement (together with the other agreements
and documents being delivered pursuant to or in connection with this Agreement)
constitutes the entire agreement of the parties hereto with respect to the
subject matter hereof and thereof, and supersedes all prior agreements and
understandings of the parties, oral and written, with respect to the subject
matter hereof.
9.5 Binding
Effect. This Agreement shall inure solely to the benefit of
and shall be binding upon the Representative, the Underwriters, the Company and
the controlling persons, directors and officers referred to in Section 5 hereof,
and their respective successors, legal representatives and assigns, and no other
person shall have or be construed to have any legal or equitable right, remedy
or claim under or in respect of or by virtue of this Agreement or any provisions
herein contained. The term “successors and assigns” shall not include a
purchaser, in its capacity as such, of securities from any of the
Underwriters.
9.6 Governing
Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York, without giving
effect to conflict of laws. The Company hereby agrees that any action,
proceeding or claim against it arising out of, or relating in any way to this
Agreement shall be brought and enforced in the courts of the State of New York
of the United States of America for the Southern District of New York, and
irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive.
The Company hereby waives any objection to such exclusive jurisdiction and that
such courts represent an inconvenient forum. Any such process or summons to be
served upon the Company may be served by transmitting a copy thereof by
registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in Section 11 hereof. Such mailing
shall be deemed personal service and shall be legal and binding upon the Company
in any action, proceeding or claim. The Company agrees that the prevailing
party(ies) in any such action shall be entitled to recover from the other
party(ies) all of its reasonable attorneys’ fees and expenses relating to such
action or proceeding and/or incurred in connection with the preparation
therefor.
9.7 Execution in
Counterparts. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement, and shall become effective when one
or more counterparts has been signed by each of the parties hereto and delivered
to each of the other parties hereto. Delivery of a signed counterpart of this
Agreement by facsimile or email/pdf transmission shall constitute valid and
sufficient delivery thereof.
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9.8 Waiver,
etc. The failure of any of the parties hereto to at any time
enforce any of the provisions of this Agreement shall not be deemed or construed
to be a waiver of any such provision, nor to in any way effect the validity of
this Agreement or any provision hereof or the right of any of the parties hereto
to thereafter enforce each and every provision of this Agreement. No waiver of
any breach, non-compliance or non-fulfillment of any of the provisions of this
Agreement shall be effective unless set forth in a written instrument executed
by the party or parties against whom or which enforcement of such waiver is
sought; and no waiver of any such breach, non-compliance or non-fulfillment
shall be construed or deemed to be a waiver of any other or subsequent breach,
non-compliance or non-fulfillment.
If the
foregoing correctly sets forth the understanding between the Underwriters and
the Company, please so indicate in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement between
us.
| Very truly yours, | |||
|
FUNTALK
CHINA HOLDINGS LIMITED
|
|||
|
|
By:
|
||
| Name: | |||
| Title: | |||
| Accepted
on the date first above written. XXXXXX & XXXXXXX, LLC |
|||
| By: | |||
| Name: | |||
| Title: | |||
24
