Exhibit
10.2
NOTE AND WARRANT PURCHASE AGREEMENT
This
NOTE AND WARRANT PURCHASE AGREEMENT (this
“Agreement’) is made as of November 12, 2007 by
and between Network CN Inc., a Delaware corporation (the
“Company”), and Wei An Developments Limited (the
“Investor”).
RECITALS
A. The
Company is currently in need of funds to help finance its
operations.
B. The
Investor is willing to advance funds to the Company in
exchange for the issuance to them of (i) certain convertible
promissory notes evidencing the Company’s obligation to
repay the Investor’s loan of the advanced funds and (ii)
certain warrants to purchase shares of the Company’s
common stock, all as provided in this Agreement.
NOW
THEREFORE, the parties hereby agree as follows:
1.
PURCHASE AND SALE OF NOTES AND
WARRANTS.
1.1
Note Purchase . Subject to the terms
and conditions of this Agreement, the Company agrees to sell
to the Investor, and the Investor agrees to purchase from the
Company, a Convertible Promissory Note in the form attached to
this Agreement as Exhibit A (the
“Note” ) in the
principal amount (the “Principal
Amount” ) of $5,000,000.
1.2
Warrant Issuance . Subject to the
terms and conditions of this Agreement and in consideration of
Investor’s commitment to advance up to the Principal
Amount of $5,000,000, the Company further agrees to issue to
the Investor a warrant to purchase up to 250,000 shares of the
Company’s common stock, par value $0.001 per share (
“Warrant Stock” ) in the
form attached hereto as Exhibit B (the
“Warrant” )
.
2.
CLOSING
.
The
purchase and sale of the Notes and the Warrants will take
place at the offices of Crone Rozynko LLP, 101 Montgomery
Street, San Francisco, CA 94104, at 5:00 p.m. pacific time, on
November 12, 2007, or at such other time and place as the
Company and the Investor mutually agree upon (which time and
place are referred to as the “Closing”). At the
Closing, the Investor will deliver to the Company payment in
full for the Note and the Warrant at the Closing by (i) a
check payable to the Company’s order. (ii) wire transfer
of funds to the Company or (iii) any combination of the
foregoing. At the Closing, the Company will deliver to the
Investor a duly executed Note in the Principal Amount and a
duly executed Warrant.
3.
REPRESENTATIONS AND WARRANTIES OF THE
COMPANY .
The
Company hereby represents and warrants to the Investor that
the statements in the following paragraphs of this Section
3 are all true and complete as of immediately prior to the
closing:
3.1
Organization, Good Standing, and
Qualification . The Company is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has all requisite
corporate power and authority to carry on its business as now
conducted and as proposed to be conducted. The Company is duly
qualified to transact business and is in good standing in each
jurisdiction in which the failure so to qualify would have a
material adverse effect on its business or properties. The Company
has all requisite corporate power and authority to own its
properties, to carry on its business as now conducted, and to enter
into and perform its obligations under this Agreement and the
agreements and instruments contemplated by it.
3.2
Capitalization . The authorized
capitalization of the Company immediately prior to the Closing is
as follows:
(a)
Common Stock . 800,000,000 shares of Common
Stock (the
“Common Stock”), 69,151,608 of which were issued
and outstanding. The Company has reserved (i) 2,083,333 shares
of Common Stock for issuance upon conversion of the Notes and
(ii) 250,000 shares of Common Stock for issuance upon exercise
of the Warrants.
(b)
Preferred Stock . 5,000,000 shares of
Preferred Stock and none of which were issued and
outstanding.
3.3
Authorization
. All
corporate actions on the part of the Company necessary for the
authorization, execution and delivery of this Agreement, and the
performance of all obligations of the Company hereunder, and the
authorization, issuance and delivery of the Note and Warrant has
been taken or will be taken prior to the relevant Closing. This
Agreement, the Notes and the Warrant, when executed and delivered
by the Company, shall constitute valid and legally binding
obligations of the Company, enforceable in accordance with their
terms, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and other laws of general application
affecting enforcement of creditors’ rights generally, and
(ii) as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable
remedies
3.4
Valid Issuance
.
The
Note, the shares of Common Stock issued upon conversion of the
Note, the Warrant and the Common Stock issued upon the
exercise thereof, when issued, sold, and delivered in
accordance with the terms of the Note and the Warrant, will be
duly
and validly issued, fully paid and non-assessable and, based
in part upon the representations of the Investor in this
Agreement, will be issued in compliance with all applicable
federal and state securities laws.
3.5
Compliance with Other Instruments . The
Company is not in violation or default of any provisions of any
instrument, judgment, order, writ, decree or contract to which it
is a party or by which it is bound. The execution, delivery and
performance of the Agreement, the consummation of the transactions
contemplated hereby and the authorization, issuance and delivery of
the Note and the Warrant will not result in any such violation or
be in conflict with or constitute, with or without the passage of
time and giving of notice, either a default under any such
provision, instrument, judgment, order, writ, decree or contract,
or an event which results in the creation of any lien, charge or
encumbrance upon any assets of the Company.
4.
REPRESENTATIONS, WARRANTIES AND CERTAIN AGREEMENTS OF
INVESTOR . In connection
with the transactions provided for herein, the Investor hereby
represents and warrants to the Company that:
4.1
Authorization . This Agreement
constitutes such Investor’s valid and legally binding
obligation, enforceable in accordance with its terms, except
(i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights
generally, and (ii) as limited by laws relating to the
availability of specific performance, injunctive relief or
other equitable remedies.
4.2
Purchase Entirely for Own Account .
Such Investor acknowledges that this Agreement is made with
such Investor in reliance upon such Investor’s
representation to the Company that the securities will be
acquired for investment for such Investor’s own account,
not as a nominee or agent, and not with a view to the resale
or distribution of any part thereof, and that such Investor
has no present intention of selling, granting any
participation in, or otherwise distributing the same. By
executing this Agreement, such Investor further represents
that such Investor does not have any contract, undertaking,
agreemen
