SHARE AND WARRANT EXCHANGE AGREEMENT
THIS
SHARE AND WARRANT EXCHANGE AGREEMENT, dated as of the 22nd
day of
September 2008 (the “Agreement”),
by
and among SRKP 17, Inc., a Delaware corporation (the “Company”);
Podium Technology Limited, a company organized under the laws of the British
Virgin Islands (“Podium”);
Yinlips Digital Technology (Shenzhen) Co., Ltd., a company organized under
the
laws of the People’s Republic of China and a wholly-owned subsidiary of Podium
(“Yinlips”);
and
the sole shareholder and the warrantholders of Podium, each of whom has executed
a counterpart signature page to this Agreement (the “Shareholder”
or
“Warrantholders,”
respectively, and collectively, the “Securityholders”).
The
Company, Podium, Yinlips, and the Securityholders are collectively referred
to
herein as the “Parties.”
WITNESSETH:
WHEREAS,
the Shareholder owns all of the issued and outstanding shares of the capital
of
Podium (the “Podium
Shares”).
WHEREAS,
the Warrantholders own all of the issued and outstanding warrants to purchase
shares of Podium (the “Podium
Warrants,”
and
together with the Podium Shares, the “Podium
Securities”).
WHEREAS,
the Company desires to acquire from Shareholder, and Shareholder desires
to sell
to the Company, the Podium Shares in exchange for the issuance by the Company
of
an aggregate of 65,795 shares (the “Company
Shares”)
of the
Company’s common stock, $0.0001 par value (“Common
Stock”)
to the
Shareholder and/or his designees on the terms and conditions set forth herein
(the “Share
Exchange”).
WHEREAS,
the Company desires to acquire from the Warrantholders, and the Warrantholders
desire to sell to the Company, the Podium Warrants in exchange for the issuance
by the Company of warrants (the “Company
Warrants,”
and
together with the Company Shares, the “Company
Securities”)
to
purchase an aggregate of 300,000 shares of Company Common Stock (the
“Warrant
Shares”)
to the
Warrantholders and/or their designees on the terms and conditions set forth
herein (the “Warrant
Exchange,”
and
together with the Share Exchange, the “Exchange”).
WHEREAS,
after giving effect to the Exchange and the Equity Financing as described
herein, there will be approximately 7,162,185 shares of Company Common Stock
issued and outstanding, 4,545,455 shares of the Company’s Series A Convertible
Preferred Stock (each of which is immediately convertible into one (1) share
of
Company Common Stock) issued and outstanding, and warrants to purchase 7,396,390
shares of Company Common Stock issued and outstanding.
WHEREAS,
the Parties intend, by executing this Agreement, to implement a tax-deferred
exchange of property governed by Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Internal
Revenue Code of 1986, as amended (the “Code”).
NOW,
THEREFORE, in consideration, of the promises and of the mutual representations,
warranties and agreements set forth herein, the Parties hereto agree as
follows:
ARTICLE
I
THE
EXCHANGE
1.1 The
Exchange.
Subject
to the terms and conditions of this Agreement, on the Closing Date (as
hereinafter defined):
(a) the
Company shall issue and deliver to the Shareholder and/or his designees the
number of authorized but unissued shares of Company Common Stock set forth
opposite his and/or his designee’s names set forth on Schedule
I
hereto
or pursuant to separate instructions to be delivered prior to
Closing,
(b) the
Shareholder agrees to deliver to the Company duly endorsed certificates
representing the Podium Shares,
(c) the
Company shall issue and deliver to the Warrantholders and/or their designees
the
number of Company Warrants set forth opposite their and/or their designee’s
names set forth on Schedule
I
hereto
or pursuant to separate instructions to be delivered prior to Closing,
and
(d) the
Warrantholders agree to deliver to the Company the Podium Warrants.
1.2 Time
and Place of Closing.
The
closing of the transactions contemplated hereby (the “Closing”)
shall
take place at the offices of K&L Gates LLP, or at such place and time as
mutually agreed upon by the Parties hereto. The date upon which the Closing
occurs is defined as the “Closing
Date.”
1.3 Effective
Time.
The
Exchange shall become effective (the “Effective
Time”)
at
such time as all of the conditions to set forth in Article
VII
hereof
have been satisfied or waived by the Parties hereto.
1.4 Tax
Consequences.
It is
intended by the Parties hereto that for United States income tax purposes,
the
contribution and transfer of the Podium Securities by the Securityholders
to the
Company in exchange for Company Securities constitutes a tax-deferred exchange
within the meaning of Section 351 of the Code.
ARTICLE
II
REPRESENTATIONS
AND WARRANTIES OF THE COMPANY
The
Company represents and warrants to Podium, Yinlips and the Securityholders
that
now and/or as of the Closing:
2
2.1 Due
Organization and Qualification; Due Authorization.
(a) The
Company is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware, with full corporate power
and
authority to own, lease and operate its respective business and properties
and
to carry on its business in the places and in the manner as presently conducted
or proposed to be conducted. The Company is in good standing as a foreign
corporation in each jurisdiction in which the properties owned, leased or
operated, or the business conducted, by it requires such qualification except
for any such failure, which when taken together with all other failures,
is not
likely to have a material adverse effect on the business of the
Company.
(b) The
Company does not own, directly or indirectly, any capital stock, equity or
interest in any corporation, firm, partnership, joint venture or other
entity.
(c) The
Company has all requisite corporate power and authority to execute and deliver
this Agreement, and to consummate the transactions contemplated hereby and
thereby. The Company has taken all corporate action necessary for the execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby, and this Agreement constitutes the valid and binding
obligation of the Company, enforceable against the Company in accordance
with
its terms, except as may be affected by bankruptcy, insolvency, moratoria
or
other similar laws affecting the enforcement of creditors’ rights generally and
subject to the qualification that the availability of equitable remedies
is
subject to the discretion of the court before which any proceeding therefore
may
be brought, equitable remedies is subject to the discretion of the court
before
which any proceeding
therefore may be brought.
2.2 No
Conflicts or Defaults.
The
execution and delivery of this Agreement by the Company and the consummation
of
the transactions contemplated hereby do not and shall not (a) contravene
the
Certificate of Incorporation or By-laws of the Company or (b) with or without
the giving of notice or the passage of time (i) violate, conflict with, or
result in a breach of, or a default or loss of rights under, any material
covenant, agreement, mortgage, indenture, lease, instrument, permit or license
to which the Company is a party or by which the Company is bound, or any
judgment, order or decree, or any law, rule or regulation to which the Company
is subject, (ii) result in the creation of, or give any party the right to
create, any lien, charge, encumbrance or any other right or adverse interest
(“Liens”)
upon
any of the assets of the Company, (iii) terminate or give any party the right
to
terminate, amend, abandon or refuse to perform, any material agreement,
arrangement or commitment to which the Company is a party or by which the
Company’s assets are bound, or (iv) accelerate or modify, or give any party the
right to accelerate or modify, the time within which, or the terms under
which,
the Company is to perform any duties or obligations or receive any rights
or
benefits under any material agreement, arrangement or commitment to which
it is
a party.
3
2.3 Capitalization.
The
authorized capital stock of the Company immediately prior to giving effect
to
the transactions contemplated hereby consists of 110,000,000 shares of which
100,000,000 have been designated as Company Common Stock and 10,000,000 shares
have been designated as preferred stock, $0.0001 par value (“Preferred
Stock”).
As of
the date hereof, there are 7,096,390 shares of Company Common Stock issued
and
outstanding, no shares of Preferred Stock outstanding and 7,096,390 warrants
outstanding with an exercise price of $0.0001 (the “Warrants”).
All
of the outstanding shares of Company Common Stock are, and the Company Shares
and Warrant Shares when issued in accordance with the terms hereof, will
be,
duly authorized, validly issued, fully paid and nonassessable, and have not
been
or, with respect to the Company Shares and Warrant Shares will not be issued
in
violation of any preemptive right of stockholders. Other than as set forth
herein, there is no outstanding voting trust agreement or other contract,
agreement, arrangement, option, warrant, call, commitment or other right
of any
character obligating or entitling the Company to issue, sell, redeem or
repurchase any of its securities, and there is no outstanding security of
any
kind convertible into or exchangeable for Company Common Stock. The Company
has
not granted registration
rights to any person.
2.4 Financial
Statements.
The
Company has provided Podium, Yinlips and the Securityholders copies of the
(i)
balance sheet of the Company at December 31, 2007, and the related statements
of
operations, stockholders’ equity (deficit) and cash flows for the period from
December 7, 2006 (inception) to December 31, 2007, including the notes thereto,
as audited by AJ. Xxxxxxx, P.C., independent registered public accounting
firm
and (ii) balance sheet of the Company at June 30, 2008 and the related
statements of operations, and cash flows for the six (6)-month period then
ended
(the “Financial
Statements”).
The
Financial Statements, together with the notes thereto, have been prepared
in
accordance with U.S. generally accepted accounting principles applied on
a basis
consistent throughout all periods presented. The Financial Statements present
fairly the financial position of the Company as of the dates and for the
periods
indicated. The books of account and other financial records of the Company
have
been maintained in accordance with good business
practices.
2.5 No
Assets or Liabilities.
As of
the Closing, the Company shall have no more than $50,000 in liabilities.
Except
for the foregoing or as set forth on the Financial Statements, the Company
does
not have any (a) assets of any kind or (b) liabilities or obligations, whether
secured or unsecured, accrued, determined, absolute or contingent, asserted
or
unasserted or otherwise.
2.6 Taxes.
The
Company has filed all United States federal, state, county and local returns
and
reports which were required to be filed on or prior to the date hereof in
respect of all income, withholding, franchise, payroll, excise, property,
sales,
use, value-added or other taxes or levies, imposts, duties, license and
registration fees, charges, assessments or withholdings of any nature whatsoever
(together, “Taxes”),
and
has paid all Taxes (and any related penalties, fines and interest) which
have
become due pursuant to such returns or reports or pursuant to any assessment
which has become payable, or, to the extent its liability for any Taxes (and
any
related penalties, fines and interest) has not been fully discharged, the
same
have been properly reflected as a liability on the books and records of the
Company and adequate reserves therefore have been established.
4
2.7 Indebtedness;
Contracts; No Defaults.
Other
than as set forth in Item
2.7
of the
Disclosure Schedule, the Company has no material instruments, agreements,
indentures, mortgages, guarantees, notes, commitments, accommodations, letters
of credit or other arrangements or understandings, whether written or oral,
to
which the Company is a party.
2.8 Real
Property.
The
Company does not own or lease any real property.
2.9 Compliance
with Law.
The
Company is in compliance with all applicable federal, state, local and foreign
laws and regulations relating to the protection of the environment and human
health. There are no claims, notices, actions, suits, hearings, investigations,
inquiries or proceedings pending or, to the knowledge of the Company, threatened
against the Company that are based on or related to any environmental matters
or
the failure to have any required environmental permits, and there are no
past or
present conditions that the Company has reason to believe are likely to give
rise to any material liability or other obligations of the Company under
any
environmental laws.
2.10 Permits
and Licenses.
The
Company has all certificates of occupancy, rights, permits, certificates,
licenses, franchises, approvals and other authorizations as are reasonably
necessary to conduct its respective business and to own, lease, use, operate
and
occupy its assets, at the places and in the manner now conducted and operated,
except those the absence of which would not materially adversely affect its
respective business.
2.11 Litigation.
There
is no claim, dispute, action, suit, proceeding or investigation pending or,
to
the knowledge of the Company, threatened, against or affecting the business
of
the Company, or challenging the validity or propriety of the transactions
contemplated by this Agreement, at law or in equity or admiralty or before
any
federal, state, local, foreign or other governmental authority, board, agency,
commission or instrumentality, nor to the knowledge of the Company, has any
such
claim, dispute, action, suit, proceeding or investigation been pending or
threatened, during the twelve month period preceding the date hereof. There
is
no outstanding judgment, order, writ, ruling, injunction, stipulation or
decree
of any court, arbitrator or federal, state, local, foreign or other governmental
authority, board, agency, commission or instrumentality, against or materially
affecting the business of the Company. The Company has not received any written
or verbal inquiry from any federal, state, local, foreign or other governmental
authority, board, agency, commission or instrumentality concerning the possible
violation of any law, rule or regulation or any matter disclosed in respect
of
its business.
2.12 Insurance.
The
Company does not currently maintain any form of insurance.
2.13 Patents;
Trademarks and Intellectual Property Rights.
The
Company does not own or possess any patents, trademarks, service marks, trade
names, copyrights, trade secrets, licenses, information, Internet web site(s)
or
proprietary rights of any nature.
5
2.14 Securities
Law Compliance.
The
Company has complied with all of the applicable requirements of the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”)
and
the Securities Act of 1933, as amended (the “Securities
Act”),
and
has complied with all applicable blue sky laws.
2.15 Conflicts
of Interest.
The
Company acknowledges that it is aware and understands the facts and
circumstances of the Conflicts of Interest, as defined in Section
3.7,
that
may, individually and in the aggregate, create a Conflict of Interest. The
Company hereby waives each and all of the Conflicts of Interest, in addition
to
any other conflicts of interest that may arise may exist or arise by virtue
of
the Conflicts of Interest and acknowledges that it has carefully read this
Agreement, that it is consistent with the terms previously negotiated by
the
parties, and understands that it is free at any time to obtain independent
counsel for further guidance.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF PODIUM
AND YINLIPS
Each
of
Podium and Yinlips represents and warrants to the Company that now and/or
as of
the Closing:
3.1 Due
Organization and Qualification; Due Authorization.
(a) Each
of
Podium and Yinlips is a corporation duly incorporated, validly existing and
in
good standing under the laws of the British Virgin Islands and the People’s
Republic of China, respectively, with full corporate power and authority
to own,
lease and operate its business and properties and to carry on its business
in
the places and in the manner as presently conducted or proposed to be conducted.
Each of Podium and Yinlips is in good standing as a foreign corporation in
each
jurisdiction in which the properties owned, leased or operated, or the business
conducted, by it requires such qualification except for any such failure,
which
when taken together with all other failures, is not likely to have a material
adverse effect on the business of either Podium or Yinlips.
(b) Yinlips
does not and Podium does not, except for the equity interests of Yinlips,
own,
directly or indirectly, any capital stock, equity or interest in any
corporation, firm, partnership, joint venture or other entity. Except as
set
forth in Item
3.1(b)
of the
Disclosure Schedule, there is no contract, agreement, arrangement, option,
warrant, call, commitment or other right of any character obligating or
entitling either Podium or Yinlips to issue, sell, redeem or repurchase any
of
its securities, and there is no outstanding security of any kind convertible
into or exchangeable for securities of either Podium or Yinlips.
6
(c) Each
of
Podium and Yinlips has all requisite power and authority to execute and deliver
this Agreement, and to consummate the transactions contemplated hereby and
thereby. Each of Podium and Yinlips has taken all corporate action necessary
for
the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby, and this Agreement constitutes the valid
and
binding obligation of each of Podium and Yinlips, enforceable against each
of
them in accordance with its terms, except as may be affected by bankruptcy,
insolvency, moratoria or other similar laws affecting the enforcement of
creditors’ rights generally and subject to the qualification that the
availability of equitable remedies is subject to the discretion of the court
before which any proceeding therefore may be brought.
3.2 No
Conflicts or Defaults.
The
execution and delivery of this Agreement by each of Podium and Yinlips and
the
consummation of the transactions contemplated hereby do not and shall not
(a)
contravene the governing documents of either Podium or Yinlips, or (b) with
or
without the giving of notice or the passage of time, (i) violate, conflict
with,
or result in a breach of, or a default or loss of rights under, any material
covenant, agreement, mortgage, indenture, lease, instrument, permit or license
to which either Podium or Yinlips is a party or by which either Podium or
Yinlips or any of their respective assets are bound, or any judgment, order
or
decree, or any law, rule or regulation to which their assets are subject,
(ii)
result in the creation of, or give any party the right to create, any lien
upon
any of the assets of either Podium or Yinlips, (iii) terminate or give any
party
the right to terminate, amend, abandon or refuse to perform any material
agreement, arrangement or commitment to which either Podium or Yinlips is
a
party or by which either Podium or Yinlips or any of their respective assets
are
bound, or (iv) accelerate or modify, or give any party the right to accelerate
or modify, the time within which, or the terms under which either Podium
or
Yinlips is to perform any duties or obligations or receive any rights or
benefits under any material agreement, arrangement or commitment to which
it is
a party.
3.3 Capitalization.
The
authorized capital stock of Podium immediately prior to giving effect to
the
transactions contemplated hereby consists of 50,000 ordinary shares, of which,
as of the date hereof, there were 50,000 shares issued and outstanding .
As of
the date hereof, there are warrants to purchase 300,000 ordinary shares of
Podium issued and outstanding. The registered capital of Yinlips is
RMB1,000,000. Except as set forth herein, all of the outstanding shares of
each
of Podium and Yinlips are duly authorized, validly issued, fully paid and
nonassessable, and have not been or, with respect to Podium Securities, will
not
be transferred in violation of any rights of third parties. Except as set
forth
in Item
3.3
of the
Disclosure Schedule, the Podium Securities are not subject to any preemptive
or
subscription right, any voting trust agreement or other contract, agreement,
arrangement, option, warrant, call, commitment or other right of any character
obligating or entitling either Podium or Yinlips to issue, sell, redeem or
repurchase any of its securities that will survive Closing and there is no
outstanding security of any kind convertible into or exchangeable for common
shares. All of the Podium Securities are owned of record and beneficially
by the
Securityholders and free and clear of any liens, claims, encumbrances, or
restrictions of any kind.
7
3.4 Taxes.
Each of
Podium and Yinlips has filed all returns and reports which were required
to be
filed on or prior to the date hereof, and has paid all Taxes (and any related
penalties, fines and interest) which have become due pursuant to such returns
or
reports or pursuant to any assessment which has become payable, or, to the
extent its liability for any Taxes (and any related penalties, fines and
interest) has not been fully discharged, the same have been properly reflected
as a liability on the books and records of each of Podium and Yinlips and
adequate reserves therefore have been established. All such returns and reports
filed on or prior to the date hereof have been properly prepared and are
true,
correct (and to the extent such returns reflect judgments made by either
Podium
or Yinlips such judgments were reasonable under the circumstances) and complete
in all material respects. No extension for the filing of any such return
or
report is currently in effect. No tax return or tax return liability of either
Podium or Yinlips has been audited or, presently under audit. All taxes and
any
penalties, fines and interest which have been asserted to be payable as a
result
of any audits have been paid. Neither Podium nor Yinlips has given or been
requested to give waivers of any statute of limitations relating to the payment
of any Taxes (or any related penalties, fines and interest). There are no
claims
pending for past due Taxes. All payments for withholding taxes, unemployment
insurance and other amounts required to be paid for periods prior to the
date
hereof to any governmental authority in respect of employment obligations
of
each of Podium and Yinlips have been paid or shall be paid prior to the Closing
and have been duly provided for on the books and records of each of Podium
and
Yinlips and in the Podium Financial Statements.
3.5 Indebtedness;
Contracts; No Defaults.
Other
than as set forth in Item
3.5
of the
Disclosure Schedule, neither Podium or Yinlips has any material instruments,
agreements, indentures, mortgages, guarantees, notes, commitments,
accommodations, letters of credit or other arrangements or understandings,
whether written or oral, to which either Podium or Yinlips is a
party.
3.6 Compliance
with Law.
Except
as specified in Item
3.6
of the
Disclosure Schedule, each of Podium and Yinlips are conducting their respective
businesses in material compliance with all applicable law, ordinance, rule,
regulation, court or administrative order, decree or process, or any requirement
of insurance carriers material to its business. Except as specified in
Item
3.6
of the
Disclosure Schedule, neither Podium nor Yinlips has received any notice of
violation or claimed violation of any such law, ordinance, rule, regulation,
order, decree, process or requirement.
3.7 Litigation.
(a) There
is
no claim, dispute, action, suit, proceeding or investigation pending or
threatened, against or affecting either Podium or Yinlips or challenging
the
validity or propriety of the transactions contemplated by this Agreement,
at law
or in equity or admiralty or before any federal, state, local, foreign or
other
governmental authority, board, agency, commission or instrumentality, has
any
such claim, dispute, action, suit, proceeding or investigation been pending
or
threatened, during the twelve (12)-month period preceding the date hereof,
except as specified in Item
3.7
of the
Disclosure Schedule;
8
(b) there
is
no outstanding judgment, order, writ, ruling, injunction, stipulation or
decree
of any court, arbitrator or federal, state, local, foreign or other governmental
authority, board, agency, commission or instrumentality, against or materially
affecting either Podium or Yinlips; and
3.8 Conflicts
of Interest.
Neither
Podium nor Yinlips has received any written or verbal inquiry from any federal,
state, local, foreign or other governmental authority, board, agency, commission
or instrumentality concerning the possible violation of any law, rule or
regulation or any matter disclosed in respect of its business. Each of Podium
and Yinlips acknowledges that it is aware and understands the following facts
and circumstances that may, individually and in the aggregate, create a conflict
of interest:
(i)
WestPark Capital, Inc., a FINRA member (“WestPark”),
is
the placement agent for the Equity Financing and WestPark will be paid a
commission of the gross proceeds from the Equity Financing for its services;
(ii)
Xxxxxxx Xxxxxxxxx, who is the founder, Chief Executive, and President and
indirectly holds a 100% interest in WestPark, is also the President, a Director
and a controlling stockholder of the Company beneficially holding approximately
25.0% of the Company’s Common Stock and Warrants (prior to the Exchange and
excluding shares held by WestPark Financial Services LLC as described below);
(iii)
Xxxxxxx X. Xxxxxxxxxxxx, who is the President and Chief Financial Officer
of
WestPark, is also the Secretary, Chief Financial Officer, and a Director
and a
controlling stockholder of the Company beneficially holding approximately
10.0%
of the Company’s WestPark Financial Services LLC Common Stock and Warrants
(prior to the Exchange);
(iv)
Xxxxxx Xxxxxxxxxxxx is a controlling stockholder of the Company beneficially
holding approximately 16.9% of the Company’s outstanding Common Stock and
Warrants (prior to the Exchange);
(v)
Xxxxx
XxXxxxxx, who is the Executive Vice President of Corporate Finance of WestPark,
is a stockholder of the Company beneficially holding approximately 3.5% of
the
Company’s Common Stock and Warrants (prior to the Exchange);
(vi) Xxxxx
Xxxxx, who is an employee of WestPark, is a stockholder of the Company
beneficially holding approximately 2.0% of the Company’s outstanding Common
Stock and the Warrants (prior to the Exchange);
(vii) Xxxxxx
Xxxxxxx, who is a partner of K&L Gates, legal counsel for Yinlips, is a
stockholder of the Company beneficially holding approximately 3.5% of the
Company’s outstanding Common Stock and the Warrants (prior to the Exchange);
and
(vii) WestPark
Financial Services LLC, which is the parent of WestPark and of which Xxxxxxx
Xxxxxxxxx serves as CEO and Chairman, is a controlling stockholder of the
Company beneficially holding approximately 39.1% of the Company’s Common Stock
and the Warrants (prior to the Exchange).
9
(i)
through (vii) in this Section are herein referred to as, the “Conflicts
of Interest”).
Each
of Podium and Yinlips hereby waives each and all of the Conflicts of Interest,
in addition to any other conflicts of interest that may arise, may exist
or
arise by virtue of the Conflicts of Interest and acknowledges that it has
carefully read this Agreement, that it is consistent with the terms previously
negotiated by the parties, and understands that it is free at any time to
obtain
independent counsel for further guidance.
ARTICLE
IV
REPRESENTATION
AND WARRANTIES OF THE SECURITYHOLDERS
The
Securityholders hereby represent and warrant to the Company that now and/or
as
of the Closing:
4.1 Title
to Securities.
Each of
the Securityholders is the legal and beneficial owner of the Podium Securities
to be transferred to the Company by such Securityholders as set forth opposite
each Securityholder’s name in Schedule
II
hereto,
and upon consummation of the exchange contemplated herein, the Company will
acquire from each of the Securityholders good and marketable title to the
Podium
Securities, free and clear of all liens excepting only such restrictions
hereunder upon future transfers by the Company, if any, as may be imposed
by
applicable law. The information set forth on Schedule II
with
respect to each Securityholder is accurate and complete.
4.2 Due
Authorization.
Each of
the Securityholders has all requisite power and authority to execute and
deliver
this Agreement, and to consummate the transactions contemplated hereby and
thereby. This Agreement constitutes the valid and binding obligation of each
of
the Securityholders, enforceable against such Securityholders in accordance
with
its terms, except as may be affected by bankruptcy, insolvency, moratoria
or
other similar laws affecting the enforcement of creditors’ rights generally and
subject to the qualification that the availability of equitable remedies
is
subject to the discretion of the court before which any proceeding therefore
may
be brought.
4.3 Purchase
for Investment.
(a) Each
Securityholder is acquiring the Company Securities for investment for such
Securityholder’s own account and not as a nominee or agent, and not with a view
to the resale or distribution of any part thereof, and each Securityholder
has
no present intention of selling, granting any participation in, or otherwise
distributing the same. Each Securityholder further represents that he, she
or it
does not have any contract, undertaking, agreement or arrangement with any
person to sell, transfer or grant participation to such person or to any
third
person, with respect to any of the Company Securities.
10
(b) Each
Securityholder understands that the Company Securities are not registered
under
the Securities Act on the ground that the sale and the issuance of securities
hereunder is exempt from registration under the Securities Act pursuant to
Section 4(2) thereof, and that the Company’s reliance on such exemption is
predicated on the each Securityholder’s representations set forth herein.
4.4 Investment
Experience.
Each
Securityholder acknowledges that he, she or it can bear the economic risk
of
his, her or its investment, and has such knowledge and experience in financial
and business matters that he, she or it is capable of evaluating the merits
and
risks of the investment in the Company Securities.
4.5 Information.
Each
Securityholder has carefully reviewed such information as such he, she or
it
deemed necessary to evaluate an investment in the Company Securities. To
the
full satisfaction of each Securityholder, he, she or it has been furnished
all
materials that he, she or it has requested relating to the Company and the
issuance of the Company Securities hereunder, and each Securityholder has
been
afforded the opportunity to ask questions of representatives of the Company
to
obtain any information necessary to verify the accuracy of any representations
or information made or given to him, her or it. Notwithstanding the foregoing,
nothing herein shall derogate from or otherwise modify the representations
and
warranties of the Company set forth in this Agreement, on which the
Securityholders have relied in making an exchange of the Podium Securities
for
the Company Securities.
4.6 Restricted
Securities.
Each
Securityholder understands that the Company Shares and Warrant Shares may
not be
sold, transferred, or otherwise disposed of without registration under the
Securities Act or an exemption therefrom, and that in the absence of an
effective registration statement covering the Company Shares or Warrant Shares
or any available exemption from registration under the Securities Act, the
Company Shares and Warrant Shares must be held indefinitely. Each Securityholder
is aware that the Company Shares and Warrant Shares may not be sold pursuant
to
Rule 144 promulgated under the Securities Act unless all of the conditions
of
that Rule are met. Among the conditions for use of Rule 144 may be the
availability of current information to the public about the
Company.
4.7 Exempt
Issuance.
Each of
the Securityholders acknowledges that he, she or it must assure the Company
that
the offer and sale of the Company Securities to such Securityholder qualifies
for an exemption from the registration requirements imposed by the Securities
Act and from applicable securities laws of any state of the United States.
Each
of the Securityholders agrees that he meets the criteria established in one
or
more of subsections (a) or (b), below.
(a) Accredited
Investor, Section 4(2) of the Securities Act and/or Rule 506 of Regulation
D.
The
Securityholder qualifies as an “accredited investor”, as that term is defined in
Rule 501 of Regulation D, promulgated under the Securities
Act.
11
(b) Offshore
Investor, Rule 903 of Regulation S.
The
Securityholder is not a U.S. Person, as defined in Rule 901 of
Regulation S, promulgated under the Securities Act, and the Securityholder,
severally but not jointly, represents and warrants to the Company
that:
(i) The
Securityholder is not acquiring the Company Securities as a result of, and
such
Securityholder covenants that he, she or it will not engage in any “directed
selling efforts” (as defined in Regulation S under the Securities Act) in
the United States in respect of the Company Securities which would include
any
activities undertaken for the purpose of, or that could reasonably be expected
to have the effect of, conditioning the market in the United States for the
resale of any of the Company Securities;
(ii) The
Securityholder is not acquiring the Company Securities for the account or
benefit of, directly or indirectly, any U.S. Person;
(iii) The
Securityholder is a resident of the People’s Republic of China;
(iv) the
offer
and the sale of the Company Securities to such Securityholder as contemplated
in
this Agreement complies with or is exempt from the applicable securities
legislation of the People’s Republic of China;
(v) the
Securityholder is outside the United States when receiving and executing
this
Agreement and that the Securityholder will be outside the United States when
acquiring the Company Securities,
(vi) and
the
Securityholder covenants with Company that:
|
(1)
|
offers
and sales of any of the Company Shares or Warrant Shares prior
to the
expiration of a period of one year after the date of original issuance
of
the Company Shares or Warrant Shares (the six (6)-month period
hereinafter
referred to as the “Distribution
Compliance Period”)
shall only be made in compliance with the safe harbor provisions
set forth
in Regulation S, pursuant to the registration provisions of the
Securities
Act or an exemption therefrom, and that all offers and sales after
the
Distribution Compliance Period shall be made only in compliance
with the
registration provisions of the Securities Act or an exemption therefrom
and in each case only in accordance with applicable state securities
laws;
and
|
|
(2)
|
The
Securityholder will not engage in hedging transactions with respect
to the
Company Shares or Warrant Shares until after the expiration of
the
Distribution Compliance Period.
|
12
4.8 Conflicts
of Interest.
Each
Securityholder acknowledges that he, she or it is aware and understands the
facts and circumstances of the Conflicts of Interest, as defined in Section
3.7 that
may,
individually and in the aggregate, create a conflict of interest. Each
Securityholder hereby waives each and all of the Conflicts of Interest, in
addition to any other conflicts of interest that may arise may exist or arise
by
virtue of the Conflicts of Interest and acknowledges that he, she or it has
carefully read this Agreement, that it is consistent with the terms previously
negotiated by the Parties, and understands that he, she or it is free at
any
time to obtain independent counsel for further guidance.
ARTICLE
V
COVENANTS
5.1 Further
Assurances.
Each of
the Parties shall use its reasonable commercial efforts to proceed promptly
with
the transactions contemplated herein, to fulfill the conditions precedent
for
such party’s benefit or to cause the same to be fulfilled and to execute such
further documents and other papers and perform such further acts as may be
reasonably required or desirable to carry out the provisions of this Agreement
and to consummate the transactions contemplated herein.
ARTICLE
VI
DELIVERIES
6.1 Items
to be delivered to the Securityholders prior to or at Closing by the
Company.
(a) Certificate
of Incorporation and amendments thereto, By-laws and amendments thereto,
and
certificate of good standing of the Company in Delaware;
(b) all
applicable schedules hereto;
(c) all
minutes and resolutions of board of director and shareholder meetings in
possession of the Company;
(d) shareholder
list;
(e) all
financial statements and all tax returns in possession of the
Company;
(f) resolution
from the Company’s Board appointing the designees of Podium to the Company’s
Board of Directors;
(g) resolution
from the Company’s Board, and if applicable, shareholder resolutions approving
this transaction and authorizing the issuances of the shares
hereto;
(h) letters
of resignation from the Company’s current officers and directors to be effective
upon Closing and after the appointments described in this section;
13
(i) certificates
representing the shares of the Company Shares issued in the denominations
set
forth opposite the names of the Shareholder and/or his designees on Schedule
I
to this
Agreement;
(j) warrants
representing the Company Warrants issued in the denominations set forth opposite
the names of the Warrantholders and/or their designees on Schedule
I
to this
Agreement; and
(k) any
other
document reasonably requested by the Securityholders that he, she or it deems
necessary for the consummation of this transaction.
6.2 Items
to be delivered to the Company prior to or at Closing by Podium and the
Securityholders.
(a) all
applicable schedules hereto;
(b) instructions
from Podium appointing its designees to the Company’s Board of
Directors;
(c) share
certificates and duly executed instruments of transfer and bought and sold
notes
from the Shareholder transferring the Podium Shares to the Company;
(d) the
Podium Warrants;
(e) resolutions
from the Board of Directors of Podium, if applicable, and shareholder
resolutions approving the transactions contemplated hereby;
(f) payment
of all liabilities of the Company of up to $50,000 directly out of the proceeds
of the Equity Financing (as defined in Section
7.1(f)
herein)
to the appropriate creditors of the Company which shall include indebtedness
owed to Company shareholders and fees owing to Company lawyers, accountants
and
similar parties; and
(g) any
other
document reasonably requested by the Company that it deems necessary for
the
consummation of this transaction.
ARTICLE
VII
CONDITIONS
PRECEDENT
7.1 Conditions
Precedent to Closing.
The
obligations of the Parties under this Agreement shall be and are subject
to
fulfillment, prior to or at the Closing, of each of the following
conditions:
(a) That
each
of the representations and warranties of the Parties contained herein shall
be
true and correct at the time of the Closing Date as if such representations
and
warranties were made at such time except for changes permitted or contemplated
by this Agreement;
14
(b) That
the
Parties shall have performed or complied with all agreements, terms and
conditions required by this Agreement to be performed or complied with by
them
prior to or at the time of the Closing;
(c) That
Podium shall have received, and provided a copy to the Company, an opinion
of
each of the Han Kun Law Offices and Liu & Wang, Attorneys at Law,
Podium’s
counsel in the People’s Republic of China, and Xxxxxxx, Xxxx & Xxxxxxx,
Podium’s counsel in the British Virgin Islands, substantially in the forms
attached hereto as Exhibit
A;
(d) That
the
Company shall have engaged a public relations firm prior to Closing that
is
mutually acceptable to the Company and Podium; and
(e) The
Company shall have concluded an equity financing of at least $5,000,000 at
the
time of Closing (the “Equity
Financing”).
7.2 Conditions
to Obligations of Securityholders.
The
obligations of Securityholders shall be subject to fulfillment prior to or
at
the Closing, of each of the following conditions:
(a) The
Company shall have received all of the regulatory, shareholder and other
third
party consents, permits, approvals and authorizations necessary to consummate
the transactions contemplated by this Agreement;
(b) The
Company shall have complied with Rule 14(f)(1) of the Exchange Act, if required;
and
(c) To
the
extent that the liabilities of the Company exceed $50,000 as of the Closing,
the
Company shareholders shall have satisfied and paid such excess liabilities
in
full.
7.3 Conditions
to Obligations of the Company.
The
obligations of the Company shall be subject to fulfillment at or prior to
or at
the Closing, of each of the following conditions:
(a) Podium
and the Securityholders shall have received all of the regulatory, shareholder
and other third party consents, permits, approvals and authorizations necessary
to consummate the transactions contemplated by this Agreement;
(b) The
Shareholder shall have delivered to the Company the share certificates and
duly
executed instruments of transfer and bought and sold notes from the Shareholder
transferring the Podium Shares to the Company;
(c) The
Warrantholders shall have delivered to the Company the Podium
Warrants;
15
(d) All
liabilities of the Company up to $50,000 shall be paid directly out of the
proceeds of the Equity Financing to the appropriate creditors, which shall
include indebtedness owed to the Company shareholders and fees owing to lawyers,
accountants and similar parties.
ARTICLE
VIII
TERMINATION
8.1 Termination.
This
Agreement may be terminated at any time before or, at Closing, by:
(a) The
mutual agreement of the Parties;
(b) Any
party
if:
(i) Any
provision of this Agreement applicable to a party shall be materially untrue
or
fail to be accomplished; or
(ii) Any
legal
proceeding shall have been instituted or shall be imminently threatening
to
delay, restrain or prevent the consummation of this Agreement;
(c) Upon
termination of this Agreement for any reason, in accordance with the terms
and
conditions set forth in this paragraph, each said party shall bear all costs
and
expenses as each party has incurred.
ARTICLE
IX
COVENANTS
SUBSEQUENT TO CLOSING
9.1 Registration
Rights.
The
Company shall file, within sixty (60) days after the Closing and at its expense,
with the U.S. Securities and Exchange Commission (the “Commission”)
a
registration statement (the “Initial
Registration Statement”)
covering the resale of Common Stock held by those persons (and/or their
designees) that are shareholders of the Company immediately prior to the
Closing
(“Pre-Existing
Shareholders”),
provided,
however,
that
the Company shall not be required to register the Common Stock held by such
shareholders who are affiliates of WestPark (“WestPark
Affiliates”),
as
specified in Item
9.1
of the
Disclosure Schedule,
who
shall instead receive registration rights to require the Company to file
a
registration statement (the “Second
Registration Statement”)
to
register such Common Stock within ten (10) days following the end of the
six (6)
month period that immediately follows the date on which the Company files
Initial Registration Statement with the Commission. The Company shall enter
into
a Registration Rights Agreement acceptable to the WestPark Affiliates with
respect to rights described in this Section
9.1.
In the
event the Second Registration Statement is not timely filed to register the
shares held by the WestPark Affiliates, or if the Second Registration Statement
is not timely declared effective by the Commission, as described in the
Registration Rights Agreement, the Company shall issue to such holders penalty
shares (the “Penalty
Shares”)
equal
to one percent (1%) of the shares on a monthly basis until the Second
Registration Statement is filed with or declared effective by the Commission,
as
applicable. However, no Penalty Shares shall be due to the WestPark Affiliates
if the Company is using best efforts to cause the Second Registration Statement
to be filed and declared effective in a timely manner.
16
9.2 AMEX
Listing.
The
Company shall take reasonable efforts to cause the Company’s securities to be
listed on the American Stock Exchange as soon as practicable after the
Closing.
ARTICLE
X
MISCELLANEOUS
10.1 Survival
of Representations, Warranties and Agreements.
Each of
the Parties hereto is executing and carrying out the provisions of this
Agreement in reliance upon the representations, warranties and covenants
and
agreements contained in this agreement or at the closing of the transactions
herein provided for and not upon any investigation which it might have made
or
any representations, warranty, agreement, promise or information, written
or
oral, made by the other party or any other person other than as specifically
set
forth herein. Except as specifically set forth in this Agreement,
representations and warranties and statements made by a party to in this
Agreement or in any document or certificate delivered pursuant hereto shall
not
survive the Closing Date, and no claims made by virtue of such representations,
warranties, agreements and covenants shall be made or commenced by any party
hereto from and after the Closing Date.
10.2 Access
to Books and Records.
During
the course of this transaction through Closing, each party agrees to make
available for inspection all corporate books, records and assets, and otherwise
afford to each other and their respective representatives, reasonable access
to
all documentation and other information concerning the business, financial
and
legal conditions of each other for the purpose of conducting a due diligence
investigation thereof. Such due diligence investigation shall be for the
purpose
of satisfying each party as to the business, financial and legal condition
of
each other for the purpose of determining the desirability of consummating
the
proposed transaction. The Parties further agree to keep confidential and
not use
for their own benefit, except in accordance with this Agreement any information
or documentation obtained in connection with any such
investigation.
10.3 Further
Assurances.
If, at
any time after the Closing, the Parties shall consider or be advised that
any
further deeds, assignments or assurances in law or that any other things
are
necessary, desirable or proper to complete the merger in accordance with
the
terms of this agreement or to vest, perfect or confirm, of record or otherwise,
the title to any property or rights of the parties hereto, the Parties agree
that their proper officers and directors shall execute and deliver all such
proper deeds, assignments and assurances in law and do all things necessary,
desirable or proper to vest, perfect or confirm title to such property or
rights
and otherwise to carry out the purpose of this Agreement, and that the proper
officers and directors the parties are fully authorized to take any and all
such
action.
17
10.4 Notice.
All
communications, notices, requests, consents or demands given or required
under
this Agreement shall be in writing and shall be deemed to have been duly
given
when delivered to, or received by prepaid registered or certified mail or
recognized overnight courier addressed to, or upon receipt of a facsimile
sent
to, the party for whom intended, as follows, or to such other address or
facsimile number as may be furnished by such party by notice in the manner
provided herein:
|
Attention:
|
|
If
to the Shareholder and Podium and Yinlips:
|
|
|
c/o
Yinlips Digital Technology (Shenzhen) Co., Ltd.
|
|
|
Xxxx
0000-00, Xxxxxxxx XxxXxx Building
|
|
|
Futian
District, Shenzhen, Guangdong
|
|
|
People’s
Republic of China
|
|
|
Attention:
Xxxx Xxxxxx
|
|
|
Fax:
(00) 000-0000-0000
|
|
|
With
a copy to:
|
|
|
K&L
Gates LLP
|
|
|
00000
Xxxxx Xxxxxx Xxxx., Xxxxxxx Xxxxx
|
|
|
Xxx
Xxxxxxx, Xxxxxxxxxx 00000
|
|
|
Attn:
Xxxxxx X. Xxxxxxx, Esq.
|
|
|
Fax.:
(000) 000-0000
|
|
|
If
to the Warrantholders:
|
|
|
Trillion
Growth China LP
|
|
|
00xx
Xxxxx, Xxxxxxx Xxxx, Xxxx Tower
|
|
|
000-0xx
Xxxxxx X.X., Xxxxxxx, XX
|
|
|
X0X
0X0, Xxxxxx
|
|
|
Attn:
Xxxxx Xxxxxxxx
|
|
|
Fax:
|
|
|
Midsouth
Investor Fund LP
|
|
|
000
0xx
Xxx. Xxxxx Xxx. 0000
|
|
|
Xxxxxxxxx,
XX 00000
|
|
|
Attn:
Xxxxx X. Xxxxxxx
|
|
|
Fax:
|
|
18
|
If
to the Company:
|
|
SRKP
17, Inc.
|
|
0000
Xxxxxx xx xxx Xxxxx, Xxxxx 000
|
|
Xxx
Xxxxxxx, XX 00000
|
|
Attn:
Xxxxxxx Xxxxxxxxx
|
|
Fax:
(000) 000-0000
|
10.5 Entire
Agreement.
This
Agreement, the Disclosure Schedules and any instruments and agreements to
be
executed pursuant to this Agreement, sets forth the entire understanding
of the
Parties hereto with respect to its subject matter, merges and supersedes
all
prior and contemporaneous understandings with respect to its subject matter
and
may not be waived or modified, in whole or in part, except by a writing signed
by each of the Parties hereto. No waiver of any provision of this Agreement
in
any instance shall be deemed to be a waiver of the same or any other provision
in any other instance. Failure of any party to enforce any provision of this
Agreement shall not be construed as a waiver of its rights under such
provision.
10.6 Successors
and Assigns.
This
Agreement shall be binding upon, enforceable against and inure to the benefit
of, the parties hereto and their respective heirs, administrators, executors,
personal representatives, successors and assigns, and nothing herein is intended
to confer any right, remedy or benefit upon any other person. This Agreement
may
not be assigned by any party hereto except with the prior written consent
of the
other parties, which consent shall not be unreasonably withheld.
10.7 Governing
Law.
This
Agreement shall in all respects be governed by and construed in accordance
with
the laws of the State of Delaware are applicable to agreements made and fully
to
be performed in such state, without giving effect to conflicts of law
principles.
10.8 Counterparts.
This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the
same
instrument.
10.9 Construction.
Headings contained in this Agreement are for convenience only and shall not
be
used in the interpretation of this Agreement. References herein to Articles,
Sections and Exhibits are to the articles, sections and exhibits, respectively,
of this Agreement. The Disclosure Schedule is hereby incorporated herein
by
reference and made a part of this Agreement. As used herein, the singular
includes the plural, and the masculine, feminine and neuter gender each includes
the others where the context so indicates.
10.10 Severability.
If any
provision of this Agreement is held to be invalid or unenforceable by a court
of
competent jurisdiction, this Agreement shall be interpreted and enforceable
as
if such provision were severed or limited, but only to the extent necessary
to
render such provision and this Agreement enforceable.
[SIGNATURE
PAGE FOLLOWS]
19
IN
WITNESS WHEREOF,
each of
the parties hereto has executed this Agreement as of the date first set forth
above.
|
SRKP
17, INC.
|
||
|
By:
|
/s/
Xxxxxxx Xxxxxxxxx
|
|
|
Name:
|
Xxxxxxx
Xxxxxxxxx
|
|
|
Title:
|
President
|
|
|
PODIUM
TECHNOLOGY LIMITED
|
||
|
By:
|
/s/
Xxxx Xxxxxx
|
|
|
Name:
|
Xxxx
Xxxxxx
|
|
|
Title:
|
President
|
|
|
YINLIPS
DIGITAL TECHNOLOGY
|
||
|
(SHENZHEN)
CO., LTD.
|
||
|
By:
|
/s/
Xxxx Xxxxxx
|
|
|
Name:
|
Xxxx
Xxxxxx
|
|
|
Title:
|
President
|
|
[SIGNATURE
PAGES FOR SECURITYHOLDERS FOLLOW]
20
PODIUM
TECHNOLOGY LIMITED
SHAREHOLDER’S
SIGNATURE PAGE TO
Dated
September 22, 2008
Among
SRKP 17, Inc., Podium Technology Limited
Yinlips
Digital Technology (Shenzhen) Co., Ltd, and
the
Sole
Shareholder and the Warrantholders of Podium Technology Limited
The
undersigned Shareholder hereby executes and delivers the Share and Warrant
Exchange Agreement (the “Agreement”)
to
which this Signature Page is attached, which, together with all counterparts
of
the Agreement and Signature Pages of the other parties named in said Agreement,
shall constitute one and the same document in accordance with the terms of
the
Agreement.
|
/s/
Xxxx Xxxx Fu
|
|
|
(Signature)
|
|
|
Xxxx
Xxxx Fu
|
|
|
(Type
or print name)
|
|
|
|
|
|
(Type
or print name as it should appear on certificate, if
different)
|
|
|
Address:
|
6/7
Bldg., Huahan Chuangxin Block,
Keynen
Rd., Hi-Tech Industry Zone, Shenzhen
|
|
Telephone:
|
(00)
00000000000
|
|
Facsimile:
|
(___)
____________
|
Number
of Podium Shares Held: 50,000
1
PODIUM
TECHNOLOGY LIMITED
WARRANTHOLDERS’
SIGNATURE PAGE TO
Dated
September 22, 2008
Among
SRKP 17, Inc., Podium Technology Limited
Yinlips
Digital Technology (Shenzhen) Co., Ltd, and
the
Sole
Shareholder and the Warrantholders of Podium Technology Limited
The
undersigned Warrantholder hereby executes and delivers the Share and Warrant
Exchange Agreement (the “Agreement”)
to
which this Signature Page is attached, which, together with all counterparts
of
the Agreement and Signature Pages of the other parties named in said Agreement,
shall constitute one and the same document in accordance with the terms of
the
Agreement.
|
/s/
Xxxxx X. Xxxxxxx
|
|
|
(Signature)
|
|
|
Xxxxx
X. Xxxxxxx, General Partner
|
|
|
(Type
or print name)
|
|
|
MidSouth
Investor Fund LP
|
|
|
(Type
or print name as it should appear on certificate, if
different)
|
|
Address:
|
000
0xx
Xxx. Xxxxx, Xxxxx 0000
|
|
Xxxxxxxxx,
XX 00000
|
|
|
Telephone:
|
(000)
000-0000
|
|
Facsimile:
|
(000)
000-0000
|
Number
of Podium Warrants Held: 150,000
2
PODIUM
TECHNOLOGY LIMITED
WARRANTHOLDERS’
SIGNATURE PAGE TO
Dated
September 22, 2008
Among
SRKP 17, Inc., Podium Technology Limited
Yinlips
Digital Technology (Shenzhen) Co., Ltd, and
the
Sole
Shareholder and the Warrantholders of Podium Technology Limited
The
undersigned Warrantholder hereby executes and delivers the Share and Warrant
Exchange Agreement (the “Agreement”)
to
which this Signature Page is attached, which, together with all counterparts
of
the Agreement and Signature Pages of the other parties named in said Agreement,
shall constitute one and the same document in accordance with the terms of
the
Agreement.
|
/s/
Xxxxx Xxxxxxxx
|
|
|
(Signature)
|
|
|
Xxxxx
Xxxxxxxx
|
|
|
(Type
or print name)
|
|
|
Trillion
Growth China LP
|
|
|
(Type
or print name as it should appear on certificate, if
different)
|
|
Address:
|
10th
Floor, Bankers Itak Xxxx Xxxxx
000-0xx
Xxxxxx X.X., Xxxxxxx, XX, X0X0X0, Xxxxxx
|
|
Telephone:
|
(000)
000-0000
|
|
Facsimile:
|
(000)
000-0000
|
Number
of Podium Warrants Held: 150,000
3
EXHIBIT
A
FORMS
OF OPINION LETTERS
4
SCHEDULE
I
SECURITYHOLDERS
AND COMPANY SECURITIES
|
Name
|
Number of Company Shares
|
Number of Company Warrants
|
|||||
|
Xxxx
Xxxx Fu
|
65,795
|
0
|
|||||
|
Trillion
Growth China LP
|
0
|
150,000
|
|||||
|
Midsouth
Investor Fund LP
|
0
|
150,000
|
|||||
5
SCHEDULE
II
SECURITYHOLDERS
AND PODIUM SECURITIES
|
Name
|
Number of Podium Shares
|
Number of Podium Warrants
|
|||||
|
Xxxx
Xxxx Fu
|
50,000
|
0
|
|||||
|
Trillion
Growth China LP
|
0
|
150,000
|
|||||
|
Midsouth
Investor Fund LP
|
0
|
150,000
|
|||||
6
DISCLOSURE
SCHEDULES
ITEM
2.7 – INDEBTEDNESS; CONTRACTS; NO DEFAULTS
As
set
forth in the Financial Statements.
ITEM
3.1(b) – BRIDGE NOTES
On
May
30, 2008, Podium entered into a Note and Warrant Purchase Agreement with
Triple
Growth China LP and Midsouth Investor Fund LP (the “Lenders”) whereby Podium
issued the Lenders promissory notes in an aggregate principal amount of
$600,000, bearing interest at a rate of 12% per year, and five-year warrants
to
purchase an aggregate of 300,000 shares of Podium’s common stock at an exercise
price of $1.10 (the “Podium
Warrants”).
The
Podium Warrants shall be exchanged for the Company Warrants upon the Closing
of
the Exchange.
ITEM
3.3 – CAPITALIZATION
See
Item
3.1(b) above.
ITEM
3.5 – INDEBTEDNESS; CONTRACTS; NO DEFAULTS
Podium
is
a party to the Restated and Amended Equity Transfer Agreement (the “Restated
Equity Agreement”) pursuant to which Podium shall make payments to Xxxx Xxxxxx
(formerly known as Zhao Taisheng) and Xxxxx Xxxxxxxx equal to RMB 19,200,000
(the “Debt”)
within
one (1) year of the effective date of the Restated Equity Agreement. Upon
the
Closing of the Exchange, the Company shall assume the Debt and make the required
payments to Xx. Xxxx and Xx. Xxxxx in accordance with the terms of the Restated
Equity Agreement.
Also
see
Item 3.1(b) above.
ITEM
3.6 – COMPLIANCE WITH THE LAW
See
Item
3.7 below.
ITEM
3.7 – LITIGATION
None.
ITEM
9.1 – WESTPARK AFFILIATES
Xxxxxxx
Xxxxxxxxx
Xxxxxx
Xxxxxxxxx Trust
Xxxxxx
Xxxxxxxxx Trust
Xxxxxxx
X. Xxxxxxxxxxxx
Xxxxx
XxXxxxxx
Xxxxx
Xxxxx
WestPark
Financial Services, LLC
7
TABLE
OF CONTENTS
|
Page
|
||
|
ARTICLE
I THE EXCHANGE
|
2
|
|
|
1.1
|
The
Exchange
|
2
|
|
1.2
|
Time
and Place of Closing
|
2
|
|
1.3
|
Effective
Time
|
2
|
|
1.4
|
Tax
Consequences
|
2
|
|
|
||
|
ARTICLE
II
|
2
|
|
|
2.1
|
Due
Organization and Qualification; Due Authorization.
|
3
|
|
2.2
|
No
Conflicts or Defaults
|
3
|
|
2.3
|
Capitalization
|
3
|
|
2.4
|
Financial
Statements
|
4
|
|
2.5
|
No
Assets or Liabilities
|
4
|
|
2.6
|
Taxes
|
4
|
|
2.7
|
Indebtedness;
Contracts; No Defaults
|
5
|
|
2.8
|
Real
Property
|
5
|
|
2.9
|
Compliance
with Law
|
5
|
|
2.10
|
Permits
and Licenses
|
5
|
|
2.11
|
Litigation
|
5
|
|
2.12
|
Insurance
|
5
|
|
2.13
|
Patents;
Trademarks and Intellectual Property Rights
|
5
|
|
2.14
|
Securities
Law Compliance
|
6
|
|
2.15
|
Conflicts
of Interest
|
6
|
|
|
||
|
ARTICLE
III REPRESENTATIONS AND WARRANTIES OF YINLIPS
|
6
|
|
|
3.1
|
Due
Organization and Qualification; Due Authorization.
|
6
|
|
3.2
|
No
Conflicts or Defaults
|
7
|
|
3.3
|
Capitalization
|
7
|
|
3.4
|
Taxes
|
8
|
|
3.5
|
Indebtedness;
Contracts; No Defaults
|
|
|
3.6
|
Compliance
with Law
|
8
|
|
3.7
|
Litigation.
|
8
|
|
3.8
|
Conflicts
of Interest
|
9
|
|
|
||
|
ARTICLE
IV REPRESENTATION AND WARRANTIES OF THE
SECURITYHOLDERS
|
10
|
|
|
4.1
|
Title
to Shares
|
10
|
|
4.2
|
Due
Authorization
|
10
|
|
4.3
|
Purchase
for Investment.
|
10
|
|
4.4
|
Investment
Experience
|
11
|
|
4.5
|
Information
|
11
|
|
4.6
|
Restricted
Securities
|
11
|
|
4.7
|
Exempt
Issuance
|
11
|
|
4.8
|
Conflicts
of Xxxxxxxx
|
00
|
-
x -
|
XXXXXXX
X XXXXXXXXX
|
00
|
|
|
5.1
|
Further
Assurances
|
13
|
|
|
||
|
ARTICLE
VI DELIVERIES
|
13
|
|
|
6.1
|
Items
to be delivered to the Securityholders prior to or at Closing by
the
Company.
|
13
|
|
6.2
|
Items
to be delivered to the Company prior to or at Closing by Podium
and the
Securityholders.
|
14
|
|
|
||
|
ARTICLE
VII CONDITIONS PRECEDENT
|
14
|
|
|
7.1
|
Conditions
Precedent to Closing
|
14
|
|
7.2
|
Conditions
to Obligations of Securityholders
|
15
|
|
7.3
|
Conditions
to Obligations of the Company
|
15
|
|
|
||
|
ARTICLE
VIII TERMINATION
|
16
|
|
|
8.1
|
Termination
|
16
|
|
|
||
|
ARTICLE
IX COVENANTS SUBSEQUENT TO CLOSING
|
16
|
|
|
9.1
|
Registration
Rights
|
16
|
|
9.2
|
AMEX
Listing
|
17
|
|
|
||
|
ARTICLE
X MISCELLANEOUS
|
17
|
|
|
10.1
|
Survival
of Representations, Warranties and Agreements
|
17
|
|
10.2
|
Access
to Books and Records
|
17
|
|
10.3
|
Further
Assurances
|
17
|
|
10.4
|
Notice
|
18
|
|
10.5
|
Entire
Agreement
|
19
|
|
10.6
|
Successors
and Assigns
|
19
|
|
10.7
|
Governing
Law
|
19
|
|
10.8
|
Counterparts
|
19
|
|
Construction
|
19
|
|
|
10.10
|
Severability
|
19
|
-
ii -
