Exhibit 4
SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT, dated as of May 7, 2001, between INTERNET
CREATIONS LIMITED, a company incorporated under the laws of the British Virgin
Islands (the "Seller") and HONG KONG JADE BIRD SCIENCE AND TECHNOLOGY LIMITED,
a Hong Kong corporation (the "Purchaser").
1. Sale of Stock. Subject to the terms and conditions contained
herein, on the Settlement Date (as defined below), the Seller hereby
agrees to sell and deliver to the Purchaser and the Purchaser hereby
agrees to purchase from the Seller 1,347,991 shares of Common Stock (the
"Common Shares") of Xxxx.xxx, Inc., a Delaware Corporation (the
"Company"), at a price equal to US$1.73 per share of the Company's Common
Shares (the "Purchase Price").
2. Settlement. Subject to satisfaction of the conditions of settlement
specified in Section 3 of this Agreement, settlement of the sale and
purchase under Section 1 of this Agreement (the "Settlement") shall take
place at 10:00 a.m. on the tenth Business Day following execution of this
Agreement by both the Purchaser and the Seller. Settlement shall take
place at the offices of the Seller in Hong Kong on such date, or on such
other date, time or place as the Purchaser and the Seller may mutually
agree (the "Settlement Date"). On the Settlement Date, the Seller shall
cause to be delivered to the Purchaser a certificate or certificates
evidencing the Common Shares and a duly executed instrument of transfer,
against delivery by the Purchaser to the Seller of the Purchase Price.
The Purchase Price shall be paid by wire transfer of immediately
available funds to such account or accounts as the Seller shall designate
in writing. As used in this Agreement, the term "Business Day" means a
day (other than a Saturday or Sunday) on which banks are generally open
for business in the Hong Kong Special Administrative Region of the
People's Republic of China.
3. Conditions of Settlement.
A. The obligation of the Purchaser to purchase and pay for the
Common Shares is subject to the satisfaction of each of the following
conditions: (i) all representations and covenants of the Seller
contained in Section 4 hereof shall be true and correct in all
respects on and as of the Settlement Date, with the same force and
effect as though such representations and covenants had been made on
and as of the Settlement Date; and (ii) the Seller shall have
delivered to the Purchaser the representation letter attached hereto
as Exhibit A.
B. The obligation of the Seller to sell and deliver the Common
Shares is subject to the satisfaction of each of the following
conditions: (i) all representations and covenants of the Purchaser
contained in Section 5 hereof shall be true and correct in all
respects on and as of the Settlement Date, with the same force and
effect as though such representations and covenants had been made on
and as of the Settlement Date; and (ii) the Purchaser shall have
delivered to the Seller the representation letter attached hereto as
Exhibit B.
4. Representations and Covenants of Seller. The Seller represents, warrants
and agrees that:
a) The Seller beneficially owns and has the unrestricted right
(other than as such right may be restricted by laws of general
application, including the Securities Act of 1933, as amended (the
"Act")) to transfer the Common Shares, free and clear of all liens,
claims, charges and other encumbrances.
b) The Seller has full corporate right, power and authority to
enter into this Agreement and to transfer the Common Shares in
accordance with the terms of this Agreement and this Agreement
constitutes a legal, valid and binding obligation of the Seller.
c) The Seller's execution, delivery and performance of the
Agreement do not violate or conflict with any law applicable to it,
any agreement or instrument to which it is a party, any order or
judgment of any court or other agency of government applicable to it
or any of its assets, or any contractual restriction binding on or
affecting it or any of its assets.
d) The Seller is not an "affiliate" of the Company, as such term is
defined in Regulation 230.501(b) under the Act.
5. Representations and Covenants of Purchaser. The Purchaser represents,
warrants and agrees that:
a) The Purchaser is acquiring the Common Shares to be acquired
by it hereunder for its own account, not as a nominee or agent, and
not with a view to, or for resale in connection with, any
distribution thereof, and will resell such Common Shares only in
transactions which would be permissible under the securities laws of
the United States of America or any state thereof.
b) The Purchaser is an "accredited investor" as such term is defined in
Regulation 230.501(a) under the Act.
c) The Purchaser is aware that, until the Company is reasonably
satisfied in accordance with industry practice that such legend is
not required, a legend similar to the following may appear on the
certificates representing the Common Shares: "The Securities
represented by this Certificate have not been registered under the
Securities Act of 1933 and may not be sold or otherwise transferred
without an opinion of counsel satisfactory to Xxxx.xxx Inc. that
such transfer may be made without such registration."
d) The Purchaser has full corporate right, power and authority
to enter into this Agreement, and to purchase the Common Shares from
the Seller on the terms described herein, and this Agreement
constitutes a legal, valid and binding obligation of Purchaser.
e) The Purchaser's execution, delivery and performance of the
Agreement do not violate or conflict with any law applicable to it,
any agreement or instrument to which it is a party, any order or
judgment of any court or other agency of government applicable to it
or any of its assets, or any contractual restriction binding on or
affecting it or any of its assets.
f) The Purchaser acknowledges and represents that it has made its own
investigation into the merits and risks of entering into the
transaction contemplated by this Agreement, is experienced in
evaluating and investing in private placement transactions of
securities in companies similar to the Company, and that it has the
capacity and financial experience to evaluate the same and to protect
its own interest. The Purchaser believes it has received all the
information it considers necessary or appropriate for deciding
whether to acquire the Common Shares and has had an opportunity to
secure all such information as it deems necessary regarding the
business, properties, prospects and financial condition of the
Company.
g) The Purchaser understands that the Common Shares have not
been registered under the Act, nor qualified under any state
securities laws, and that they are being offered and sold pursuant
to an exemption from such registration and qualification based in
part upon the representations and covenants of the Purchaser
contained herein. The Purchaser understands that the Common Shares
being purchased hereunder are restricted securities within the
meaning of Rule 144 under the Act; that the Common Shares are not
registered and must be held indefinitely unless they are
subsequently registered or an exemption from such registration is
available.
h) The Purchaser is not a U.S. Person within the meaning of Regulation
S of the Act.
6. Law Governing. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without reference to
choice of law doctrine.
7. Parties in Interest. All the terms and provisions of this Agreement shall
be binding upon and inure to the benefit of and be enforceable by the
respective heirs, representatives, successors, and assigns of the parties
hereto.
8. Investor Rights Agreement. The Seller is transferring its rights
to the Purchaser pursuant to Section 4.1 of the Xxxx.xxx, Inc. Third
Amended and Restated Investor Rights Agreement dated February 1, 2000,
among the Company and the investors named therein (the "Investor Rights
Agreement") subject to all the terms and conditions contained in the
Investor Rights Agreement, as amended. The Purchaser acknowledges that it
has received and reviewed the Investor Rights Agreement and will be
subject to the terms and conditions contained therein.
9. Miscellaneous. This Agreement may be executed concurrently in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Each counterpart
may be delivered by facsimile transmission, which transmission shall be
deemed delivery of an originally executed document. The headings of the
Sections hereof are inserted for convenience only and shall not be deemed
to constitute a part hereof. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof
and supersedes all the previous agreements, promise or representations,
whether written or oral, between the parties. Any provision of this
Agreement which is invalid, illegal or unenforceable in any jurisdiction
shall, as to that jurisdiction, be ineffective to the extent of such
invalidity, illegality or unenforceability, without affecting in any way
the remaining provisions hereof in such jurisdiction or rendering that or
any other provision of this Agreement invalid, illegal or unenforceable
in any other jurisdiction.
10. Fees and Expenses. Each of the Purchaser and the Seller agrees to pay its
own expenses and disbursements incident to the performance of its
obligations hereunder.
11. Amendment and Waiver. This Agreement may be amended only by a written
agreement executed by each of the parties hereto. No amendment of or
waiver of, or modification of any obligation under this Agreement will be
enforceable unless set forth in a writing signed by the party against
which enforcement is sought. Any amendment effected in accordance with
this section will be binding upon all parties hereto and each of their
respective successors and assigns. No delay or failure to require
performance of any provision of this Agreement shall constitute a waiver
of that provision as to that or any other instance. No waiver granted
under this Agreement as to any one provision herein shall constitute a
subsequent waiver of such provision or of any other provision herein, nor
shall it constitute the waiver of any performance other than the actual
performance specifically waived.
12. Confidentiality. The Purchaser and the Seller hereby agree to keep
this Agreement and the transaction contemplated herein confidential until
the earlier of (a) the consummation of the transaction on the Settlement
Date or (b) the public filing by the Purchaser of Schedule 13D in
connection with the transaction contemplated herein with the Securities
and Exchange Commission. Notwithstanding the foregoing, upon discovery by
the Seller that all or any part of the transaction contemplated herein is
required to be disclosed pursuant to the Rules Governing the Listing of
Securities on The Stock Exchange of Hong Kong Limited (the "Listing
Rules"), the Seller shall immediately notify the Purchaser of such
requirement and, after consultation with the Purchaser, take such actions
as may be necessary for continued compliance with the Listing Rules.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
SELLER: INTERNET CREATIONS LIMITED
By:_________________________________
Name:
Title:
PURCHASER: HONG KONG JADE BIRD SCIENCE AND TECHNOLOGY LIMITED
By:
----------------------------------------
Name:
Title:
[SECURITIES PURCHASE AGREEMENT BETWEEN INTERNET CREATIONS
LIMITED AND HONG KONG JADE BIRD SCIENCE AND TECHNOLOGY
LIMITED]
EXHIBIT A
FORM OF SELLER'S REPRESENTATION LETTER
May 7, 2001
HONG KONG JADE BIRD SCIENCE AND TECHNOLOGY LIMITED
Xxxx 00, 0xx Xxxxx, Asia Pacific Center, 0 Xxxxxxx Xxxxxx, Xxxx Xxxx
In connection with the sale by the undersigned of 1,347,991 shares of Common
Stock (the "Common Shares") of Xxxx.xxx, Inc., a Delaware Corporation (the
"Company"), at a price of US$1.73 per share of the Company's Common Stock (the
"Purchase Price"), the undersigned, being a duly authorized officer Internet
Creations Limited, a company incorporated under the laws of the British Virgin
Islands (the "Seller"), hereby represents to you that:
1. Seller acquired 259,229 shares of Series D Convertible Preferred Stock
from the Company on February 2, 2000 pursuant to a Series D Preferred
Stock Purchase Agreement, dated January 29, 2000, between the Company and
the persons and entities set forth on Exhibit A thereto (the "Tranche I
Purchase Agreement"); and 259,229 shares of Series D Convertible
Preferred Stock on February 2, 2000 pursuant to a Series D Preferred
Stock Purchase Agreement (Tranche II), dated February 2, 2000, between
the Company and Seller (such shares, together with the shares purchased
pursuant to the Tranche I Purchase Agreement, the "Preferred Shares").
The Preferred Shares were acquired in a private placement transaction and
were exempt from the registration requirements of Section 5 of the
Securities Act of 1933 by virtue of Section 4(2) thereof and Rule 506
thereunder based on opinions of U.S. counsel to the Company issued to the
Seller dated February 1, 2000 and February 2, 2000.
2. Upon the completion of the initial public offering of the Company
on or about July 12, 2000, the Preferred Shares were automatically
converted into 1,347,991 shares of Common Stock of the Company, adjusted
for stock splits. Seller did not pay any additional consideration for the
shares of Common Stock received upon such conversion. The Common Shares
which Seller is selling to Purchaser are part of this block of shares.
Counsel to the Company is entitled to rely on this letter in connection with
rendering its opinion letter to the Company or the transfer agent for the
common stock of the Company in connection with the sale of the Common Shares
by Seller to Purchaser.
Very truly yours,
INTERNET CREATIONS LIMITED
By:_________________________
Title:_______________________
EXHIBIT B
FORM OF PURCHASER'S REPRESENTATION LETTER
May 7, 2001
INTERNET CREATIONS LIMITED
In connection with the purchase by the undersigned of 1,347,991 shares of
Common Stock (the "Common Shares") of Xxxx.xxx, Inc., a Delaware Corporation
(the "Company"), at a price of US$1.73 per share of the Company's Common Stock
(the "Purchase Price"), the undersigned, being a duly authorized officer of
Hong Kong Jade Bird Science and Technology Limited, a Hong Kong Company (the
"Purchaser"), hereby represents to you that:
1. Purchaser is acquiring the Common Shares to be acquired by it hereunder
for its own account and will resell such Common Shares only in
transactions which would be permissible under the securities laws of the
United States of America or any state thereof.
2. Purchaser is an "accredited investor" as such term is defined in
Regulation 230.501(a) under the Securities Act of 1933, as amended (the
"Act").
3. Purchaser acknowledges that the Common Shares have not been registered
under the Securities Act of 1933, as amended (the "Securities Act") or
the securities laws of any state, and, as a result thereof, the Common
Shares are "restricted securities" as defined in Rule 144 under the
Securities Act and are subject to substantial restrictions on transfer,
and that the Common Shares and certificates evidencing the same will bear
a legend reflecting such restrictions.
4. Purchaser understands that the Common Shares are being offered
and sold by Seller in reliance on exemptions from the registration
requirements of federal and state securities laws and that the Company is
relying upon the truth and accuracy of the representations, warranties,
agreements, acknowledgments and understandings set forth herein in order
to determine the applicability of such exemptions.
Counsel to the Company is entitled to rely on this letter in connection with
rendering its opinion letter to the Company or the transfer agent for the
common stock of the Company in connection with the sale of the Common Shares
by Seller to Purchaser.
Very truly yours,
HONG KONG JADE BIRD SCIENCE AND TECHNOLOGY LIMITED
By:_________________________
Title:_______________________
