Exhibit 4.2


     

    Exhibit
      4.2

     

    
 

    GLOBAL
      SOURCES LTD.

     

    


     

    DIRECTORS
      PURCHASE PLAN

     

    (as
      of 5
      November 2005)

     

    ARTICLE
      I


     

    PURPOSE

     

    The
      purpose of the Directors
      Purchase Plan (the
      “Plan”)
      is to
      secure for Global Sources Ltd. and its stockholders the benefits arising from
      stock ownership by its Directors. The Plan will provide a means whereby such
      Directors may purchase common shares, One United States Cent (US$0.01) par
      value, of Global Sources Ltd. pursuant to purchase rights granted in accordance
      with the Plan.

     

    ARTICLE
      II


     

    DEFINITIONS

     

    The
      following capitalized terms used in the Plan shall have the respective meanings
      set forth in this Article:

     

    2.1  “Balance
      of the Purchase Price”
shall
      have the meaning ascribed thereto in Section 6.5 hereof.

     

    2.2  “Board”
shall
      mean the Board of Directors of Global Sources Ltd.

     

    2.3  “Code”
shall
      mean the Internal Revenue Code of 1986, as amended.

     

    2.4  “Company”
shall
      mean Global Sources Ltd. and any of its Subsidiaries.

     

    2.5  “Deposit”
shall
      have the meaning ascribed thereto in Section 6.5 hereof.

     

    2.6  “Director”
shall
      mean any person who is a member of the Board of Directors of the
      Company.

     

    2.7  “Eligible
      Director”
shall
      be
      any Director of
      the
      Company who has attended at least seventy-five per cent (75%) of the Board
      meetings held in the previous calendar year.

     

    2.8  “Exchange
      Act”
shall
      mean the Securities Exchange Act of 1934, as amended.

     

    2.9  “Exercise
      Price”
shall
      mean the price per Share at which a Purchase Right may be exercised, being
      the
      Fair Market Value of the Shares as determined in accordance with Section 2.11
      hereof.

     

    2.10  “Expiration
      Date”
in
      relation to a Purchase Right shall mean February 28 of the same year in which
      such Purchase Right is granted.

     


    
      
         

      

      
         

        
          

        

      

      
         

      

    


    


     

    2.11  “Fair
      Market Value”
shall
      mean the average closing sales price for the last five (5) trading days of
      the
      previous calendar year of publicly-traded Shares as quoted on the national
      securities exchange on which Shares are listed (if the Shares are so listed)
      or
      on the Nasdaq Stock Market System (if the Shares are regularly quoted on the
      Nasdaq Stock Market System), or, if not so listed or regularly quoted, the
      average of the high bid and low asked price for the last five (5) trading days
      of the previous calendar year of publicly-traded Shares in the over-the-counter
      market, or, if such bid and asked prices shall not be available, as reported
      by
      any nationally recognized quotation service selected by the Board.

     

    2.12  “Grant
      Date”
shall
      mean January 1 of each calendar year.

     

    2.13  “Nasdaq”
shall
      mean the Nasdaq National Stock Market.

     

    2.14  “Permanent
      Disability”
shall
      mean the condition of an Eligible Director who is unable to participate as
      a
      member of the Board by reason of any medically determined physical or mental
      impairment that can be expected to result in death or which can be expected
      to
      last for a continuous period of not less than twelve (12) months.

     

    2.15  “Purchase
      Price”
shall
      be
      the Exercise Price multiplied by the number of whole Shares with respect to
      which a Purchase Right may be exercised.

     

    2.16  “Purchase
      Right”
shall
      mean a right to purchase Shares granted pursuant to the Plan.

     

    2.17  “Securities
      Act”
shall
      mean the Securities Act of 1933, as amended.

     

    2.18  “Shares”
shall
      mean the common shares, One United States Cent (US$0.01) par value per share,
      of
      the Company.

     

    2.19  “Subsidiaries”
shall
      have the meaning provided in Section 425(f) of the Code.

     

    ARTICLE
      III


     

    ADMINISTRATION

     

    3.1  General.
      The Plan
      shall be administered by the Board in accordance with the express provisions
      of
      the Plan.

     

    3.2  Powers
      of the Board.
      The
      Board shall have full and complete authority to adopt such rules and regulations
      and to make all other determinations not inconsistent with the Plan as may
      be
      necessary for the administration of the Plan.

     

    ARTICLE
      IV


     

    SHARES
      SUBJECT TO PLAN

     

    Subject
      to
      adjustment in accordance with Article IX, an aggregate of one million
      (1,000,000) Shares is reserved for issuance under the Plan. Shares issued under
      the Plan may be 

     


    
      
         

      

      
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    either
      authorized but unissued Shares or reacquired Shares. If a Purchase Right, or
      any
      portion thereof, shall expire or terminate for any reason without having been
      exercised in full, or any or all of the Common Shares purchased upon exercise
      are forfeited, the unpurchased or forfeited Shares covered by such Purchase
      Right shall be available for future grants of Purchase Rights.

     

    ARTICLE
      V


     

    GRANTS

     

    5.1  Grants
      of Purchase Rights.
      On each
      Grant Date, to the extent that Shares remain available for the grant of Purchase
      Rights under the Plan, each Eligible Director on such date shall automatically
      receive the grant of a Purchase Right to purchase twenty thousand (20,000)
      Shares.

     

    5.2  Adjustment
      of Grants.
      The
      number of Shares set forth in Section 5.1, to which Purchase Rights shall be
      granted shall be subject to adjustment as provided in Section 9.1
      hereof.

     

    5.3  Compliance
      With Rule 16b-3.
      If the
      Company is then subject to the requirements of Section 16 of the Exchange Act,
      the terms for the grant of Purchase Rights to an Eligible Director may only
      be
      changed if permitted under Rule 16b-3 under the Exchange Act and, accordingly,
      the formula for the grant of Purchase Rights may not be changed or otherwise
      modified more than once in any six (6) month period, other than to comport
      with
      changes in the Code, the Employee Retirement Income Security Act, or the rules
      and regulations thereunder.

     

    ARTICLE
      VI


     

    TERMS
      OF
      PURCHASE RIGHT

     

    Each
      Purchase Right shall be deemed to be automatically granted to an Eligible
      Director on the Grant Date, without the need for any notification to the
      Eligible Director or for the execution of any written agreement (whether for
      the
      purposes of documenting, evidencing, effecting or perfecting the grant of the
      Purchase Right or otherwise).

     

    6.1  Term.
      The term
      of each Purchase Right shall expire on the Expiration Date, subject to earlier
      termination in accordance with Articles VI and X.

     

    6.2  Restriction
      on Exercise.
      The
      Purchase Right must be exercised prior to the Expiration Date, or at such time
      or times and subject to such terms and conditions as shall be determined by
      the
      Board at or prior to grant; provided, however, that in the case of the Eligible
      Director's death or Permanent Disability, the Purchase Rights held by him or
      her
      shall become immediately exercisable, unless a longer exercise period is
      otherwise determined by the Board at or prior to grant. Any Purchase Right
      that
      has not been exercised by the Expiration Date shall be forfeited. The Board
      may
      waive any installment exercise provision at any time in whole or in part based
      on performance and/or such other factors as the Board may determine in its
      sole
      discretion; provided, however, that no Purchase Right shall be exercisable
      pursuant to such waiver until the requisite approval of the waiver by the
      Company's shareholders shall have been obtained.

     


    
      
         

      

      
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    6.3  Exercise
      Price.
      The
      Exercise Price for each Share subject to a Purchase Right shall be the Fair
      Market Value of the Shares as determined in accordance with Section 2.11
      hereof.

     

    6.4  Issuance
      of Shares.
      All of
      the Shares to be issued pursuant to the exercise of a Purchase Right shall
      be
      issued only at the end of four (4) years after February 28 of the year in which
      such Purchase Right is exercised. (By way of illustration, if a Purchase Right
      is exercised on or before February 28, 2006, then all of the Shares to be issued
      pursuant to such exercise shall be issued only on February 28, 2010.) The
      resignation of a Director following his or her exercise of a Purchase Right
      shall not cause a forfeiture of the unissued Shares, provided that the Balance
      of the Purchase Price is paid in full on or before the due date thereof (as
      set
      out in Section 6.5 hereof).

     

    6.5  Manner
      of Exercise and Payment.
      A
      Purchase Right shall be exercised by payment of ten per cent (10%) of the total
      Purchase Price of the Shares being purchased (“Deposit”),
      on or
      before the Expiration Date. The Deposit shall be not be refundable under any
      circumstances whatsoever. The balance of ninety per cent (90%) of the total
      Purchase Price of the Shares being purchased (“Balance
      of the Purchase Price”)
      shall
      be paid in full on or before the expiration of the holding period for the Shares
      (as determined in accordance with Section 6.4 hereof), failing which the Deposit
      shall be forfeited, any and all rights under the Purchase Right and to the
      issuance of the Shares shall automatically lapse and expire, and the Shares
      shall not be issued. An Eligible Director may exercise a Purchase Right with
      respect to all or less than all of the Shares for which the Purchase Right
      may
      then be exercised, but an Eligible Director must exercise the Purchase Right
      in
      full Shares.

     

    6.6  Payment
      Method.
      The
      Purchase Price of Shares purchased pursuant to a Purchase Right or portion
      thereof, shall be paid in
      United
      States Dollars, in cash, or by check, bank draft or money order payable to
      the
      Company, or by wire or telegraphic transfer.

     

    6.7  Transferability.
      No
      Purchase Right shall be transferable otherwise than by will or the laws of
      descent and distribution or pursuant to a qualified domestic relations order
      as
      defined by the Code or Title I of the Employee Retirement Income Security Act,
      or the rules thereunder. A Purchase Right shall be exercisable during the
      Eligible Director's lifetime only by the Eligible Director, his or her guardian
      or legal representative.

     

    6.8  Termination
      of Membership on the Board.
      If an
      Eligible Director's membership on the Board terminates for any reason other
      than
      such Eligible Director's resignation, the unexercised portion of any Purchase
      Right held on the date of termination may be exercised in whole or in part
      at
      any time within thirty (30) days after the date of such termination (but in
      no
      event after the term of the Purchase Right expires) and shall thereafter
      terminate. Any Shares issued pursuant to previously-exercised Purchase Rights
      or
      upon exercise of Purchase Rights following termination as a Director shall
      be
      issued according to Section 6.4.

     


    
      
         

      

      
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    ARTICLE
      VII


     

    GOVERNMENT
      AND OTHER REGULATIONS

     

    7.1  Delivery
      of Shares.
      The
      obligation of the Company to issue or transfer and deliver Shares for exercised
      Purchase Rights under the Plan shall be subject to all applicable laws,
      regulations, rules, orders and approvals which shall then be in
      effect.

     

    7.2  Holding
      of Shares After Exercise of Purchase Right.
      By
      exercising a Purchase Right, the Eligible Director shall be deemed to have
      represented and agreed, for him or her, and for his or her permitted transferees
      hereunder, that none of the Shares purchased upon exercise of the Purchase
      Right
      shall be acquired with a view to any sale, transfer or distribution of the
      Shares in violation of the Securities Act, and the person exercising a Purchase
      Right shall, if and upon being requested by the Company, furnish evidence
      satisfactory to the Company to that effect, and/or a written agreement or
      undertaking to indemnify the Company in the event of any violation of the
      Securities Act by such person.

     

    Notwithstanding
      the foregoing, the Company in its sole discretion may register under the
      Securities Act the Shares issuable upon exercise of the Purchase Rights under
      the Plan.

     

    ARTICLE
      VIII


     

    WITHHOLDING
      TAX

     

    The
      Company may, in its discretion, require an Eligible Director to pay to the
      Company, at the time of exercise of a Purchase Right and/or payment of the
      Balance of the Purchase Price, an amount that the Company deems necessary to
      satisfy its obligations to withhold federal, state or local income or other
      taxes (which for purposes of this Article includes an Eligible Director's FICA
      obligation, if applicable) incurred by reason of such exercise. When the
      exercise of a Purchase Right and/or the payment of the Balance of the Purchase
      Price does not give rise to the obligation to withhold U.S. federal income
      taxes
      on the date of such exercise and/or payment, the Company may, in its discretion,
      require an Eligible Director to place Shares purchased under the Purchase Right
      in escrow for the benefit of the Company until such time as U.S. federal income
      tax withholding is required on amounts included in the Eligible Director's
      gross
      income as a result of the exercise of a Purchase Right and/or the payment of
      the
      Balance of the Purchase Price. At such time, the Company, in its discretion,
      may
      require an Eligible Director to pay to the Company an amount that the Company
      deems necessary to satisfy its obligation to withhold federal, state or local
      taxes incurred by reason of the exercise of the Purchase Right and/or the
      payment of the Balance of the Purchase Price, in which case the Shares shall
      be
      released from escrow upon such payment by an Eligible Director (but shall
      continue to be subject to the issuance requirements of Section 6.4
      hereof).

     


    
      
         

      

      
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    ARTICLE
      IX


     

    ADJUSTMENTS

     

    9.1  Proportionate
      Adjustments.
      If the
      outstanding Shares are increased, decreased, changed into or exchanged into
      a
      different number or kind of Shares or securities of the Company through
      reorganization, recapitalization, reclassification, stock dividend, bonus issue,
      stock split, reverse stock split or other similar transaction, an appropriate
      and proportionate adjustment shall be made to the maximum number and kind of
      Shares (a) as to which Purchase Rights already granted under the Plan, but
      not
      yet exercised, may be exercised; or (b) which are to be issued pursuant to
      a
      Purchase Right already granted and exercised under the Plan. Notwithstanding
      the
      foregoing, there shall be no adjustment for the issuance of Shares on conversion
      of notes, preferred stock or exercise of warrants or Shares issued by the Board
      for such consideration as the Board deems appropriate.

     

    9.2  Dissolution
      or Liquidation.
      Upon the
      dissolution or liquidation of the Company, or upon a reorganization, merger
      or
      consolidation of the Company with one or more corporations as a result of which
      the Company is not the surviving corporation, or upon a sale of substantially
      all of the property or more than eighty per cent (80%) of the then outstanding
      Shares of the Company to one (1) or more previous business entities, the Company
      shall give to each Eligible Director at the time of adoption of the plan for
      liquidation, dissolution, merger or sale either:-

     

    (a)  a
      reasonable time thereafter within which to exercise the Purchase Right prior
      to
      the effective date of such liquidation or dissolution, merger or sale;
      or

     

    (b)  the
      right
      to exercise the Purchase Right as to an equivalent number of Shares of equity
      securities of the business entity succeeding the Company or acquiring its
      business by reason of such liquidation, dissolution, merger, consolidation
      or
      reorganization.

     

    ARTICLE
      X


     

    AMENDMENT
      OR TERMINATION OF PLAN

     

    10.1  Amendments.
      The
      Board may at any time amend or revise the terms of the Plan, provided no such
      amendment or revision shall, unless appropriate approval of such amendment
      or
      revision by the Company's shareholders is obtained:

     

    (a)  materially
      increase the maximum number of Shares which may be sold pursuant to Purchase
      Rights granted under the Plan, except as permitted under the provisions of
      Article IX;

     

    (b)  decrease
      the minimum Exercise Price set forth in Article VI;

     

    (c)  extend
      the
      term of Purchase Rights provided for in Article VI or decrease the holding
      period of any Shares to be issued pursuant to the exercise of a Purchase Right;
      or

     


    
      
         

      

      
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    (d)  permit
      the
      granting of Purchase Rights to anyone other than an Eligible
      Director.

     

    10.2  Termination.
      The
      Board at any time may suspend or terminate the Plan. The Plan, unless sooner
      terminated, shall terminate on the tenth (10th) anniversary of its adoption
      by
      the Board. Termination of the Plan shall not affect Purchase Rights previously
      granted thereunder. No Purchase Right may be granted under the Plan while the
      Plan is suspended or after it is terminated.

     

    10.3  Consent
      of Holder.
      No
      amendment, suspension or termination of the Plan shall, without the consent
      of
      the holder of Purchase Rights, alter or impair any rights or obligations under
      any Purchase Right theretofore granted under the Plan.

     

    ARTICLE
      XI


     

    MISCELLANEOUS
      PROVISIONS

     

    11.1  Privilege
      of Stock Ownership.
      No
      Eligible Director entitled to exercise any Purchase Right granted under the
      Plan
      shall have any of the rights or privileges of a shareholder of the Company
      with
      respect to any Shares issuable upon exercise of a Purchase Right until he or
      she
      is entered as a shareholder in the Company’s register of
      shareholders.

     

    11.2  Plan
      Expenses.
      Any
      expenses incurred in the administration of the Plan shall be borne by the
      Company.

     

    11.3  Use
      of
      Proceeds.
      Payments
      received from an Eligible Director pursuant to the exercise of Purchase Rights
      shall be used for general corporate purposes of the Company.

     

    11.4  Governing
      Law.
      The Plan
      has been adopted under the laws of Bermuda. The Plan and all Purchase Rights
      which may be granted hereunder and all matters related thereto, shall be
      governed by and construed and enforceable in accordance with the laws of Bermuda
      as it then exists.

     

    ARTICLE
      XII


     

    SHAREHOLDER
      APPROVAL

     

    If
      any
      amendment of or revision to the Plan is subject to the approval of the Company's
      shareholders, such approval shall be obtained at a duly held meeting of the
      Company's shareholders, by the affirmative vote of holders of a majority of
      the
      Shares of the Company represented in person or by proxy and entitled to vote
      at
      the meeting. No Purchase Right based on such amendment or revision shall be
      granted or exercised, or shall be valid if granted or exercised based on such
      amendment or revision, if the approval of the Company’s shareholders for such
      amendment or revision is required but is not obtained as aforesaid; provided
      however that, for the avoidance of doubt, nothing herein shall (or shall be
      deemed to) prohibit or invalidate any Purchase Right or any grant or exercise
      of
      any Purchase Right, if such Purchase Right and the grant and exercise thereof
      would nevertheless have been permitted and valid under the Plan in the absence
      of such amendment or revision.

     

    


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