Document:

BP53677 -- Avenue Group, Inc. -- Exhibit 10.1

EXHIBIT 10.1

Stock Purchase Agreement 

This Stock Purchase Agreement (the “Agreement”) is dated as of September 10, 2004 by and between ROO Group, Inc., a Delaware corporation (the “ROO”), and Avenue Group, Inc., a Delaware corporation (“Avenue”) in connection with the purchase by ROO of One Thousand (1,000) shares of .0001 par value common stock (the “Bickhams Shares”) of Bickhams Media, Inc., a Delaware corporation and an wholly-owned subsidiary of Avenue (“Bickhams”). The Bickhams Shares consists of all of the outstanding capital stock of Bickhams. Avenue acknowledges and understands that the sale of the Bickhams Shares is not covered by an effective Registration Statement pursuant to the United States Securities Act of 1933, as amended (the “Act”). Accordingly, the reoffer and resale of the Shares by the Guarantor will be restricted pursuant to the Act. 

In consideration of the mutual promises contained herein and the terms and conditions of this Agreement, Avenue and ROO agree and represent as follows:

A. 

PURCHASE OF THE BICKHAM SHARES

1.

ROO hereby agrees to subscribe to and purchase the Bickham Shares no later than 1:00pm Los Angles time on September 15, 2004 (the “Termination Date”) for the following aggregate consideration:

(a) 

$300,000 in cash, immediately available funds or via wire transfer, payable as follows: 

(i) 

$250,000 on or before the Termination Date, and 

(ii) 

$50,000 upon completion of audited financial statements for Bickhams for the years ended December 31, 2003 and December 31, 2002 and unaudited financial statements for the three and six month periods ending June 30, 2004 (the “Financials”).

(b) 

Four Million (4,000,000) shares of ROO common stock issued on or before the Termination Date in consideration for the Bickham Shares (the “ROO Consideration Shares”). An additional Three Million (3,000,000) shares of ROO common stock shall be issued on or before the Termination Date in consideration for the Termination Letter, as defined below (the “Settlement Shares”) (the Consideration Shares and the Settlement Shares hereinafter collectively referred to as the “ROO Shares”).

(c) 

An executed guaranty by ROO of (i) all of the obligations of VideoDome.com Networks, Inc., a Delaware corporation and a 50% owned subsidiary of Bickhams (“VideoDome”) under that certain promissory note of VideoDome to Avenue dated October 2003 in the principal amount of Two Hundred Ninety Thousand U.S. Dollars (US $290,000), a copy of which is attached hereto and made a part hereof as Exhibit “A “(the “VideoDome Note”) and (ii) the following payments: (y) for a period of one year from the date hereof, Avenue shall receive no less than Four Thousand Dollars ($4,000) per month from VideoDome and/or ROO as principal reduction payments pursuant to the VideoDome Note, commencing one month from the date hereof; PLUS, (z) the payment to Avenue one year from the date of this Agreement of all amounts then outstanding under the VideoDome Note, including but not limited to principal and accrued and unpaid interest due (the “Guaranty”), a form of the Guaranty is attached hereto and made a part hereof as Exhibit “B.”

2.

Except the $50,000 payment pursuant to Section 1(a)(ii) above, items (1) through (3) above are hereinafter collectively referred to as the “Consideration.” Upon receipt by Avenue of the Consideration in full (the “Closing Time”), Avenue agrees to deliver to ROO the Bickhams Shares, along with stock powers executed in blank as well as the “Termination Letter,” as hereinafter defined. Avenue agrees that subject to and conditioned upon the occurrence of the “Closing Time,” Avenue shall deliver to ROO a termination letter which shall serve to terminate the Registration Rights Agreement dated as of November 28, 2003 (the “Registration Rights Agreement”) and any 

and all rights of Avenue against ROO whatsoever with respect thereto in the form as attached hereto and made a part hereof as Exhibit “C.” In consideration of Avenue foregoing its rights under the Registration Rights Agreement, ROO has agreed to issue hereunder the Settlement Shares. Anything to the contrary contained herein notwithstanding, in the event the Closing Time has not occurred on or before the Termination Date this Agreement shall automatically terminate, be rendered null and void and be of no force and effect whatsoever without any further action on the part of ROO or Avenue. 

3.

Closing. The parties to this Agreement shall consummate the transactions contemplated by this Agreement at a closing (the “Closing”) to be held no later than the Termination Date. The date of Closing is referred to herein as the “Closing Date.” The Closing shall take place at the offices of counsel to ROO, or at such other place as may be mutually agreed upon by ROO and Avenue. 

4.

Deliveries at Closing. At Closing, the parties shall deliver all certificates representing the ROO Shares and the Bickhams Shares and shall deliver all other executed documents and agreements described in this Article A.

5.

This Agreement is subject to, and conditioned upon, the approval by the Board of Directors of Avenue on or before 12:00 pm midnight on September 12, 2004.

B. 

REPRESENTATIONS AND WARRANTIES

1.

Avenue (with respect to itself and the Bickhams Shares)and ROO (with respect to itself and the ROO Shares) hereby represent and warrant to one another as follows:

(a)

They are each corporations duly organized, validly existing and in good standing under the laws of the State of Delaware; 

(b)

The execution, delivery and performance of this Agreement have been duly authorized by their respective Boards of Directors. They have full corporate power and authority to enter into this Agreement and to perform their obligations hereunder. This Agreement constitutes a valid and legally binding obligation of each Company, enforceable in accordance with its terms and conditions except to the extent the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting the enforcement of creditors’ rights or by general equitable principles. 

(c)

Upon the issuance and/or delivery of the Bickhams Shares and the ROO Shares, respectively, upon the terms and conditions set forth herein, the ROO Shares and the Bickhams Shares shall be validly issued, fully paid and non-assessable.

(d)

 The Bickhams Shares and the ROO Shares are being transferred to ROO and Avenue, respectively, free and clear of any liens, claims, charges, rights, restrictions, options, preemptive rights, mortgages, deeds of trust, easements, leases, hypothecations, assessments, pledges, encumbrances, claims of equitable interest or security interests of any kind or nature whatsoever. 

(e)

The ROO Shares and the Bickhams Shares are each being offered and sold under the exemption from registration provided for in Section 4(2) of the Act, that their offers and sales were not subject to public advertisement or part of any other sale of securities by either party, and no offering literature or prospectus have been provided by either party to the other party with respect thereto. The sale of the ROO Shares and the Bickhams Shares contemplated hereby has not been scrutinized by the SEC or by and any administrative agency charged with administration of the Securities laws of any state (except some states where the transaction might be registered). 

(f) 

Neither ROO nor Avenue has relied upon any representations or other information (whether oral or written) from the other party, or any of their respective officers, directors, employees or agents other than as expressly set forth herein or, in the case of Avenue, the information regarding ROO as set forth in ROO’s publicly available filings with the SEC and its press releases.

2.

Representations of ROO.

(a)

ROO is an “accredited investor” as such term is defined pursuant to Rule 501(a) promulgated under the Act.

(b) 

ROO recognizes that (i) Bickhams’ principal asset consists of its 50% ownership of the capital stock of VideoDome, (ii) to date VideoDome’s business and operations have relied almost entirely on the efforts of its other 50% shareholders Daniel and Vardit Aharanoff, ROO recognizes that there is no guaranty that it will be able to maintain the services or cooperation of the Aharanoffs with respect to the ongoing business or operations of ROO, (iii) VideoDome has limited operating history and financial resources and will be dependant on proceeds from ROO and other financings to implement its business plan, and (iv) that investment in Bickhams involves substantial risks.

(c)

there is no material adverse information regarding ROO, its business, operations financial status or prospects except as set forth in ROO’s publicly available filings with the SEC or press releases. 

3.

Representations, Warranties and Covenants of Avenue

(a) 

The Bickhams Shares represent all of the issued and outstanding shares of capital stock of Bickhams. There are no outstanding rights, options or warrants to purchase any shares of capital stock of Bickhams. 

(b) 

Avenue shall use reasonable commercial endeavors to cause Weinberg & Company, P.A to perform its audits and reviews on Bickhams so that Bickhams may issue the Financials within 30 days after the execution of this Agreement at ROO’s sole cost and expense. 

(c) 

Bickhams’ has at no time engaged in an operating business and its sole asset currently consists of its 50% ownership of the capital stock of VideoDome.

4.

ROO and Avenue shall indemnify and hold harmless one another or any of their respective officers, employees, registered representatives, agents, attorneys, directors, or control persons of any such entity (collectively, “Representatives”) who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, against losses, liabilities and expenses (including reasonable attorneys’ fees, judgments, fines and amounts paid in settlement or otherwise) incurred by the ROO, Avenue or their respective Representatives, by reason of or arising from or relating to any actual or alleged breach of any of their representations, warranties, covenants or agreements set forth in this Agreement which is not remedied by timely notice to the other party as provided above.

C.

UNDERSTANDINGS

1.

ROO and /or Avenue acknowledge and agree, as the case may be, as follows:

 

(a)

No federal or state agency has made any finding or determination as to the fairness of this offering for investment, nor any recommendation or endorsement of the Bickham Shares or the ROO Shares.

 

(b)

Currently, there is no public market for the Bickham Shares and there is no certainty that such a market will ever develop. There can be no assurance that ROO will be able to sell or dispose of the Bickham Shares. Moreover, no assignment, sale, transfer, exchange or other disposition of the Bickham Shares can be made other than in accordance with all applicable securities laws. 

 

(c)

Any information which the either party receives which is not contained in the publicly available information or reports filed with the SEC and is not otherwise available to the public shall be deemed to be confidential and nonpublic, and all such information shall be kept in confidence by the receiving party and shall not be used by receiving party for their personal benefit (other than in connection with the transactions 

contemplated by this Agreement) nor disclosed to any third party for any reason; provided, that this obligation shall not apply to any such information which (i) is part of the public knowledge or literature and readily accessible at the date hereof; (ii) becomes part of the public knowledge or literature and readily accessible by publication (except as a result of a breach of these provisions); or (iii) is received from third parties (except third parties who disclose such information in violation of any confidentiality agreements).

 

(d)

The parties each have sufficient knowledge and experience in financial and business matters so that they are is capable of evaluating the merits and risks of investment in Bickhams and ROO, as the case may be, and of making an informed investment decision.

 

(e)

The parties each have had prior personal or business relationships with the one another or by reason of their business or financial experience, have the capacity to protect their own interest in connection with this transaction.

2.

The representations, warranties, understandings, acknowledgments and agreements of the parties to this Agreement are true and accurate as of the date hereof and shall survive thereafter.

3.

Immediately following the Closing Date, Avenue shall deliver to ROO the resignations of all of the then serving members of the Board of Directors and officers of Bickhams. 

4.

As soon as practicable after the Closing Date, Avenue agrees to deliver to ROO the corporate minute books for Bickhams and original or copies of such other Bickhams corporate documents and files as ROO may reasonably request. 

5.

ROO agrees that it shall cause Bickham’s representatives on the Board of Directors of VideoDome to vote in favor of continuing to support VideoDome’s business and operations and the compensation packages payable to Daniel and Vardit Aharonoff at a level comparable or greater than what is currently being provided.

6.

ROO agrees for a period of 2 years from the date of this Agreement, it shall cause VideoDome to continue to provide without charge to Avenue and its subsidiaries, information technology services comparable to those currently provided, including video streaming.

7.

ROO agrees that it shall cause Bickham’s representatives on the Board of Directors of VideoDome to vote in favor of appointing Robert Petty and Robin Smyth to the board of VideoDome and immediately upon appointment Levi Mochkin and Jonathan Herzog will resign from VideoDome’s board.

D.

MISCELLANEOUS

1.

All pronouns and any variations thereof used herein shall be deemed to refer to the masculine, feminine, singular, or plural as the identity of the person or persons may require.

2.

Neither this Agreement nor any provisions hereof shall be waived, modified, changed, discharged, terminated, revoked, or canceled except by an instrument in writing signed by the party against whom any change, discharge, or termination is sought.

3.

Notices required or permitted to be given hereunder shall be in writing and shall be deemed to be sufficiently given when personally delivered or sent by registered mail, return receipt requested, addressed to the other party at the address of such party set forth on the signature page, as amended from time to time, or, in the case of the Purchaser, at the address provided in this Agreement, or to such other address furnished by notice given in accordance with this Article D.

4.

Failure of either party to exercise any right or remedy under this Agreement or any other agreement between the parties, or otherwise, or delay by either party in exercising such right or remedy, will not operate as a waiver thereof. No waiver by either party will be effective unless and until it is in writing and signed by such party.

5.

Arbitration.

(a)

Any dispute, controversy or claim arising out of, relating to, or in connection with, this Agreement, or the breach, termination or validity thereof, except for claims for equitable, including injunctive, relief, shall be finally settled by arbitration conducted in accordance with this Section. The arbitration shall be conducted in accordance with the rules of the American Arbitration Association (the “AAA”) in effect at the time of the arbitration, except as they may be modified herein or by mutual agreement of the parties. The seat of the arbitration shall be Los Angeles, CA.. Each party hereby irrevocably submits to the jurisdiction of the arbitrator in Los Angeles, CA and waives any defense in an arbitration based upon any claim that such party is not subject personally to the jurisdiction of such arbitrator, that such arbitration is brought in an inconvenient forum or that such venue is improper.

(b)

The arbitration shall be conducted by one arbitrator, who shall be appointed by the AAA. The arbitrator shall have the authority only to enforce the legal and contractual rights of the parties and shall not add to, modify, disregard, or refuse to enforce any contractual provision. There shall be no pre-arbitration discovery. The parties acknowledge and agree that by entering into this Agreement they are agreeing to this arbitration provision and are waiving all rights to a trial by jury. The arbitral award shall be in writing and shall be final and binding on the parties. The award shall include an award of costs, includ­ing the fees and costs of the arbitrators and reasonable attorneys’ fees and disbursements in accordance with the arbitrator’s view of the merits of the parties’ respective positions in the dispute. Except upon a finding of actual fraud, intentional or knowing misrepresenta­tion, willful and knowing omissions of material fact or willful misconduct, no such award shall include punitive damages. Judgment upon the award may be entered by any governmental authority having jurisdiction thereof or having jurisdiction over the parties or their assets.

6.

This Agreement shall be enforced, governed and construed in all respects in accordance with the laws of the State of California (without giving effect to principles of conflicts of law) and shall be binding upon and shall inure to the benefit of the parties and their respective heirs, estate, legal representatives, successors and assigns.

7.

In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof.

8.

This Agreement along with the Exhibits hereto constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersede any and all prior or contemporaneous representations, warranties, agreements and understandings in connection therewith. Except as otherwise provided in this Section 8, this Agreement may be amended only by a writing executed by all parties hereto. No party shall be liable or bound to the other in any manner by any warranties, representations or covenant except as specifically set forth herein. 

9.

The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties hereto. Nothing in this Agreement, express or implied, is intended to confer upon any party, other than the parties hereto, and their respective successors and assigns, any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided herein.

10.

This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

11.

The titles of the paragraphs and subparagraphs of this Agreement are for convenience and are not to be considered in construing this Agreement.

12.

 Any notice required or permitted hereunder shall be given in writing and shall be deemed effectively given upon personal delivery or if deposited the United States Post Office, be registered or certified mail, addressed to a party at its address hereinafter shown below its signature or at such other address as such party may designate by ten (10) days advance written notice to the other party.

13.

The warranties and representations of the parties contained in or made pursuant to this Agreement shall survive the executions and delivery of this Agreement and the closing hereunder.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement this 10th day of September, 2004.

	 	ROO Group, Inc.

	                                                                                                     

	                                                                              

	 	 
	 	/s/ ROBERT PETTY

	 	By: Robert Petty 

	 	Its: CEO 

	 	 
	 	Avenue Group, Inc., 

	 	 
	 	 
	 	/s/ JONATHAN HERZOG

	 	By: Jonathan Herzog

	 	Its: Executive Vice President

NEITHER THE BICKHAM SHARES NOR THE ROO SHARES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED UNLESS THEY ARE REGISTERED UNDER THE ACT OR AN EXEMPTION THEREFROM IS AVAILABLE.

ROO GROUP, INC. GUARANTY

This Guaranty (the “Guaranty”) is made entered into this 10th day of September, 2004 by the ROO Group, Inc., a Delaware corporation (the “Guarantor”) in favor of the Avenue Group, Inc., a Delaware corporation (the “Company”), pursuant to that certain Agreement dated September 10, 2004 ( the “Agreement”) between ROO and the Company. 

In connection with the foregoing, the Guarantor hereby agrees, subject to the terms hereof, to:

A. Unconditionally guarantee and agree to be liable for the full and indefeasible payment and performance when due of all now existing and future indebtedness, obligations or liabilities of VideoDome Networks.com, Inc (“VideoDome”) to the Company under that certain promissory note in the original principal amount of $290,000USD dated October 2003 (the “Promissory Note”), howsoever arising, whether direct or indirect, absolute or contingent, secured or unsecured, whether arising under the Promissory Note as now written or as amended or supplemented hereafter, or by operation of law or otherwise. The Company represents that as of the date hereof the outstanding principal balance on the Promissory Note is $288,000USD.

B. To pay to the Company on demand the amount of all expenses (including reasonable attorney’s fees) incurred by the Company in collecting or attempting to collect any of the Guarantor’s obligations to it under this Guaranty; and agrees to pay any interest at the highest lawful rate on all amounts payable to the Company under the Promissory Note, even if such amount cannot be collected from VideoDome. 

C. Notwithstanding anything to the contrary contained elsewhere herein or in the Promissory Note, to unconditionally guarantee and agree to be liable for the full and indefeasible payment to the Company of (i) no less than Four Thousand Dollars ($4,000.00) per month of outstanding principal under the Promissory Note for a period of twelve (12) months with the first payment due on the date hereof and (ii) the remaining outstanding principal balance of the Promissory Note plus any accrued and unpaid interest due thereunder one year from the date of this Guaranty ((i) and (ii) collectively referred to as the “Guarantor’s Payment Obligations”) .

All of the obligations, liabilities, expenses and interest set forth in items A. through C. above are hereinafter collectively called the “Obligations.” To the extent the Company receives payment on account of Obligations guaranteed hereby, which payment is thereafter set aside or required to be repaid by it in whole or in part, then, to the extent of any sum not finally retained by the Company (regardless of whether such sum is recovered from the Company by the VideoDome, its trustee, or any other party acting for, on behalf of or through the VideoDome or its representative), the Guarantors’ obligation to the Company under this Guaranty, as amended, modified or supplemented, shall remain in full force and effect (or be reinstated) until the Guarantor have made payment to the Company therefor, which payment shall be due upon demand.

This Guaranty is executed as an inducement to the Company to enter into the Agreement and to allow the consummation of the transactions contemplated thereby without the payment in full of the Promissory Note. The Guarantor agrees that the Guaranty is a portion of the Consideration received by the Company pursuant to the Agreement.

Notice of acceptance of this Guaranty, the amendment, execution or termination of the Agreement or any other agreements in connection therewith, and presentment, demand, protest, notice of protest, notice of non-payment and all other notices to which the Guarantor may be entitled (whether under this Guaranty or the Agreement), and the Company’s reliance on this Guaranty are hereby waived. The Guarantors also waives notice of: changes in terms or extensions of the time of payment under the Promissory Note, the taking and releasing of collateral or guarantees and the settlement, compromise or release of any Obligations, and agree that, as to the Guarantor, the amount of the Obligations shall not be diminished by any of the foregoing. The Guarantor also agrees that the Company need not attempt to collect any Obligations from VideoDome or any other obligor or to realize upon any collateral, but may require the Guarantor to make immediate payment of Obligations to the Company when due or at any time thereafter. The Company shall not be liable for failure to collect Obligations or to realize upon any collateral or security therefor, or any part thereof, or for any delay in so doing, nor shall the Company be under any obligation to take any action whatsoever with regard thereto.

This Guaranty is absolute, unconditional and continuing, regardless of the validity, regularity or enforceability of any of the Obligations or the fact that a security interest or lien in any collateral or security therefor may not be enforceable by the Company or may otherwise be subject to equities or defenses or prior claims in favor of others or may be invalid or defective in any way and for any reason, including any action, or failure to act, on the part of the Company. Payment by the Guarantor shall be made to the Company in US dollars at its office in California from time to time on demand as Obligations become due, and one or more successive or concurrent actions may be brought hereon against the Guarantor either in the same action or in separate actions. In the event any claim or action, or action on any judgment, based on this Guaranty, is made or brought against the Guarantor, the Guarantor agrees not to assert against the Company any set-off or counterclaim which the Company may have, and, further, the Guarantors agree not to deduct, set-off, or seek to counterclaim for or recoup, any amounts which are or may be owed by the Company to the Guarantor under the Agreement or otherwise, or for any loss of contribution from any other guarantor. Furthermore, in any litigation based on the Guaranty in which the Company and the Guarantor shall be adverse parties, the Guarantor hereby waives trial by jury and waive the right to interpose any defense based upon any Statute of Limitations or any claim of laches and waive the performance of each and every condition precedent to which the Guarantor might otherwise be entitled by law. All sums at any time to the credit of the Guarantor and any property of the Guarantor on which the Company at any time have a lien or security interest, or of which the Company at any time have possession, shall secure payment and performance of all Obligations and any and all other obligations of the Guarantor to the Company however arising. 

Upon the occurrence of any of the following events:

(1) any Event of Default or default by VideoDome under the Promissory Note;

(2) 

failure of the Guarantor to (a) pay when due any of the Guarantor’s Payment Obligations or (b) to pay any other Obligation due hereunder or to observe or perform any agreements, warranties or covenants in any material respect contained herein where such failure continues unremedied for a period of no less than 10 days from the occurrence thereof; or

(3)

(a) 

calling of a meeting of the creditors of the Guarantor for the purposes of compromising the debts of the Guarantor;

(b) 

failure of the Guarantor to meet their debts as they mature;

(c) 

commencement by the Guarantor of any bankruptcy, insolvency, arrangement, reorganization, receivership or similar proceeds under federal or state law (herein collectively “Insolvency Proceeding”);

(d) 

commencement of any Insolvency Proceeding against the Guarantor,

then, in the case of event (1) above the liability of the Guarantor for the entire Obligations shall mature, and in the case of events (2) and (3)(a) through (e) above the liability of the Guarantor with respect to which such event relates for the entire Obligations shall mature even if the liability of the VideoDome therefor does not. In addition to and not in lieu of the foregoing, in the case of the occurrence of (2) or (3) above (a “Conversion Event”), the Guarantor agrees that the Company may in its sole discretion convert all or any portion of the Obligations into common stock (“Common Stock”) of the Guarantor (the “Conversion Shares”) at a Conversion Price which is equal to Five Cents per share subject to adjustment and or the issuance of substitute securities to take into effect any stock split, recapitalization, reorganization, stock dividend, merger or consolidation prior to the issuance of the “Conversion Notice,” as hereinafter defined (the “Conversion Price”). In the event of a reorganization or merger of the Guarantor where the Guarantor is not the surviving entity (“Reorganization”), notwithstanding anything to the contrary contained elsewhere herein, the Company shall be entitled to treat such Reorganization as a Conversion Event and deliver the Conversion Notice prior to the consummation of such Reorganization so that it will receive the same consideration as the other shareholders of the Guarantor upon the consummation of the Reorganization. The Guarantor agrees to issue and deliver the Conversion Shares to the Company as soon as practicable, but in any event no later than ten (10) business days after its receipt of any Conversion Notice. In 

the event Guarantor fails to deliver the Conversion Shares in a timely manner, the Company shall be entitled to receive additional conversion shares equal to two percent (2% ) of the Conversion Shares initially requested for each day the Guarantor is late in delivering the full amount of Conversion Shares due. A form of the Conversion Notice is attached hereto as Appendix 1. 

The Guarantor expressly waives any and all rights of subrogation, reimbursement, indemnity, exoneration, contribution or any other claim which it may now or hereafter have against the Company or any other person directly or contingently liable for the Obligations guaranteed hereunder, or against or with respect to the Company’s property (including, without limitation, property collateralizing its Obligations to the Company) arising from the existence or performance of this Guaranty, until such time and all obligations are indefeasibly paid in full and the Agreement is terminated.

This Guaranty embodies the whole agreement of the parties with respect thereto and may not be modified except in writing, and no course of dealing between the Company and the Guarantor shall be effective to change or modify this Guaranty. The Company’s failure to exercise any right hereunder shall not be construed as a waiver of the right to exercise the same or any other right at any other time and from time to time thereafter, and such rights shall be considered as cumulative rather than alternative. No knowledge of any breach or other nonobservance by the Guarantor of the terms and provisions of this Guaranty shall constitute a waiver thereof, nor a waiver of any obligations to be performed by the Guarantor hereunder.

Absent a breach of this Guaranty by the Guarantor or a default by the Guarantor in the payment of any Obligation due under this Guaranty, this Guaranty may be not be assigned by the Company. Upon the occurrence of any such breach or default by the Guarantor, in addition to any other rights that the Company may have under law, in equity or pursuant to this Guaranty, the Company may in its sole discretion sell, assign and/or transfer this Guaranty or any rights due it hereunder to any third party. In such event, the Guaranty shall be for its benefit and for the benefit of any of its assignees or transferees, and shall cover any Obligations owed to the Company at the time of assignment or transfer. 

Upon a default by VideoDome under the Promissory Note, the Company may elect to non-judicially or judicially foreclose against any real or personal property security it holds for the Obligations, or any part thereof, or exercise any other remedy against the Company or any security. No such action by the Company will release or limit the liability of the Guarantor hereunder, even if the effect of that action is to deprive the Guarantor of the right to collect reimbursement from VideoDome of any for any sums paid by the Guarantor to the Company hereunder. 

The Guarantor hereby acknowledges and agrees that the Guarantor is knowingly waiving in advance as a result of the provisions hereof a complete or partial defense to its guaranty it may later have had arising from CCP Section 580d or 580a based upon the Company’s subsequent election to conduct a private nonjudicial foreclosure sale, even though such election would destroy, diminish or affect the Guarantor’s rights against the principal obligor and the Guarantor’s rights to pursue the principal obligor for reimbursement, subrogation, contribution, or indemnity.

Without limiting the foregoing or any provision hereof, the Guarantor hereby expressly waives any and all rights, estoppels and benefits which might otherwise be available from time to time under California Civil Code Sections 2809, 2810, 2819, 2839, 2845, 2849, 2850, 2899 and 3433, and California Code of Civil Procedure Sections 580a, 580b, 580d and 726, or any of such sections.

The Guarantor represents and warrants to the Company that the execution, delivery and performance of this Guaranty, and of any documents securing the obligations under this Guaranty, (a) are not done with actual intent to hinder, delay or defraud creditors, (b) are not done at a time when the fair value of its assets, are less than its debts, including, without limitation, its obligations, (c) are not done at a time when it intends or believes or reasonably should believe that it will incur debts beyond its ability to pay as such debts mature or otherwise become due, and (d) based upon its historical needs and future projections, are not done at a time when it is engaged in business or a transaction, or is about to engage in business or a transaction, for which the property remaining in its hand is an unreasonably small capital or for which its remaining assets are unreasonably small in relation to such business or transaction absent extraordinary and unforeseen circumstances. The Guarantor hereby confirms that each of the waivers set forth herein are made with full knowledge of their significance and consequences and after due deliberation.

Anything to the contrary contained elsewhere herein notwithstanding, provided that the Guarantor is not in breach of any of its obligations under this Guaranty or in default of the payment of any obligation hereunder, the Company agrees as follows: (i) not to require the immediate payment of all outstanding principal and accrued and unpaid interest the Promissory Note for a period of one year from the date hereof; (ii) that subject to and conditioned upon payment in full of the Obligations due the Company hereunder, the Company hereby agrees to assign the Promissory Note and all of the Company’s rights hereunder to the Guarantor.

This instrument is executed and given in addition to, and not in substitution, reduction, replacement, or satisfaction of, any other endorsements or guarantees of the Obligations, now existing or hereafter executed by the Guarantor or others in the Company’s favor.

When used in this agreement, all pronouns shall, wherever applicable, be deemed to include the singular and plural as well as the masculine, feminine, and neuter genders. This agreement shall inure to the benefit of the Company, the Company’s successors and assigns and any parent, subsidiary or affiliate of the Company; shall be binding upon the Guarantor and upon its administrators, successors and assigns.

All Disputes arising between the parties hereto with respect to the making, construction, terms, or interpretation of this Guaranty or any breach thereof, or the rights or obligations of any party hereto or thereto, shall, in lieu of court action, be submitted to mandatory, binding arbitration, pursuant to the terms of Section E5 of the Agreement. 

BY INITIALING IN THE SPACE BELOW, THE COMPANY AND THE GUARANTOR ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS INCLUDED IN THE “ARBITRATION OF DISPUTES” SECTION OF THIS GUARANTY DECIDED BY NEUTRAL ARBITRATION AS PROVIDED BY THE LAWS OF THE STATE OF CALIFORNIA AND THE PARTIES HERETO ARE GIVING UP ANY RIGHTS THEY MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY TRIAL. BY INITIALING IN THE SPACE BELOW THE PARTIES ARE GIVING UP THEIR JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS THOSE RIGHTS ARE SPECIFICALLY INCLUDED IN THE “ARBITRATION OF DISPUTES” SECTION OF THE AGREEMENT. IF EITHER PARTY REFUSES TO SUBMIT TO ARBITRATION AFTER AGREEING TO THIS PROVISION, THEY MAY BE COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE LAWS OF THE STATE OF CALIFORNIA. THE PARTIES AGREE THAT THEIR AGREEMENT TO THIS ARBITRATION SECTION IS VOLUNTARY. 

THE PARTIES ACKNOWLEDGE AND AGREE THAT THEY HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE “ARBITRATION OF DISPUTES” SECTION OF THE AGREEMENT TO NEUTRAL ARBITRATION.

GUARANTOR’S INITIALS

RP

COMPANY’S INITIALS

JH 

The parties hereby consents to the in personam jurisdiction of the courts of the State of California to enforce the judgment of the arbitrator as provided above. In the event that either party brings any action or suit in any court of record of the State of California to enforce any such judgment of the arbitrator hereunder, service of process may be made by mailing a copy of the summons to the Guarantor or the Company at their then principal place of business as set forth in their most recent filings with the Securities and Exchange Commission.

This Guaranty may be executed in any number of counterparts, each of which when so executed shall be deemed an original and such counterparts shall together constitute but one and the same document.

This Guaranty shall be governed by and construed in accordance with the laws of the State of California.

IN WITNESS WHEREOF the Guarantor has executed and delivered this Guaranty effective as of the date above set forth.

	 	ROO GROUP, INC.

	                                                                                                     

	                                                                              

	 	/s/ ROBERT PETTY

	 	By: Robert Petty

	 	Its: Chief Executive OfficerExhibit 10

Exhibit 10.28

SHARE PURCAHSE AGREEMENT

THIS AGREEMENT is made as of the 9th day of June, 2002 between BEIJING CHENGBO SCIENCE & TRADE CO. (“BCST”), a corporation duly incorporated under the laws of China, BEIJING SKYLAND CULTURE LTD. (“Skyland”), a corporation duly incorporated under the laws of China, (collectively, the “Vendors”), CEN SMART NETWORKS LTD. (“CEN”), a company duly incorporated under the laws of China, (the “Purchaser”) and CHINA VENTURES INC., a company duly incorporated under the laws of the Province of British Columbia (“CVI”).

WHEREAS:

A.

The Vendors are the legal, beneficial and registered owners of 87% of the issued and outstanding common shares in the capital of Today’s Teachers Technology & Culture Ltd. (“TTTC”);

B.

CEN is a joint venture company of CVI in China;

C.

China Education Association, another shareholder of TTTC, which owns 13% of TTTC has agreed to allow BCST and Sky-land to sell their shares of TTTC to the Purchaser.

D.

The shareholders of TTTC have agreed and decided to have a new shareholder.

E.

The current valuation of TTTC is 10 million RMB.  The final estimate of value shall be decided by a third party valuation and will be adjusted upon receipt of such valuation.  It is signed that the adjustment is limited to a maximum of 15% of 10 million RMB.

F.

The sale price of 70% of TTTC is 7 million RMB (the final price shall be adjusted by the final valuation of TTTC);

G.

CEN and CVI has agreed to pay 2.8 million RMB cash and 7.9 million CVI shares at $0.10 per share to BCST and Sky-land for 70% of the shares of TTTC (the final price shall be adjusted by the final valuation of TTTC);

H.

BCST and Sky-land has agreed that the aforementioned 2.8 million RMB cash shall be reinvested into TTTC for a one year term to be used for working capital.

I.

The Vendors wish to sell and the Purchaser wishes to purchase 70% of the shares of TTTC on the terms and conditions set forth below.

NOW THEREFORE THIS AGREEMENT WITNESSTH that in consideration of the premises, and the mutual covenants and agreements set forth below, the parties hereto (the “Parties”) covenant and agree as follows:

1.0

PURCHASE AND SALE

1.1

On the basis of and subject to the terms and conditions of this Agreement, CEN agrees to purchase and the Vendors agree to sell, on the Closing Date (as hereinafter defined), the number of shares of TTTC (collectively, the “Purchased Shares”) set forth opposite the names of each of the Vendors in Schedule A in exchange for the issuance to each Vendor of the number of Common Shares of CVI (collectively, the “Common Shares”) set forth opposite such Vendor’s name in Schedule A.

1.2

The CVI Shares shall be allotted and issued by CVI by the delivery to the Vendors, on the Closing Date, of certificates duly registered in the names of the appropriate parties.  All certificates representing the CVI shares will be endorsed with a legend to the effect that the securities represented by such certificates are subject to a hold period and may not be traded in British Columbia until a date twelve months from the date of issue except as permitted by the Securities Act (British Columbia) and Securities Rules (British Columbia).

2.0

REPRESENTATIONS AND WARRANTIES

2.1

Each of the Vendors hereby warrants and represents severally, and not jointly and severally, to CEN and CVI as follows and acknowledges that CEN and CVI are relying on such representations and warranties in connection with the transactions contemplated herein:

(a)

such Vendor has necessary power, authority and right to enter into and perform it obligations under this Agreement, including without limitation, to sell and transfer the Purchased Shares owned by such Vendor to CEN;

(b)

this Agreement has been duly and validly executed and delivered by such Vendor and constitutes a legal, valid and binding obligation of such Vendor, enforceable against it in accordance with its terms;

(c)

the Purchased Shares owned by such Vendor are legally and beneficially owned by such Vendor, free and clear of all liens, mortgages, charges, encumbrances and claims whatsoever and no person, other than CEN, has any agreement or option, to acquire the Purchased shares owned by such Vendor, or any part thereof or interest therein;

(d)

except as set forth in Schedule A, none of such Vendor, or any affiliate or associate of such Vendor, owns or has any agreement or option, or right capable of becoming an agreement or option, to acquire any shares or other securities of the Company;

(e)

none of such Vendor, or any affiliate or associate of such Vendor, owns any property or assets which are located on the lands owned by the Company or are used by the Company in the conduct of its business;

(f)

the Company is a corporation duly incorporated, organized and subsisting under the laws of its jurisdiction of incorporation, and is in good standing there under.  The Company has the corporate power, authority and capacity to own and operate its properties and assets, and to carry on its business as presently being conducted;

(g)

the Company is duly qualified to carry on business in each jurisdiction in which the nature of the business or the property owned or leased by it makes such qualification necessary and in each jurisdiction in which failure to be so qualified would materially and adversely affect the Company;

(h)

the authorized capital of TTTC consists of the shares issued and outstanding and the registered owners of which are set forth in Schedule A.  All such issued and outstanding shares have been duly authorized and issued as fully paid and non-assessable and have been issued in compliance with applicable laws concerning the issuance of securities;

(i)

the books and records of the Company fairly and correctly set out and disclose in all material respects the financial position of the Company as at the date thereof and all financial transactions of the Company relating to its business have been accurately recorded in such books and records in all material respects.

(j)

the minute books of the Company have been made available to CEN and CVI and contain all articles, by-laws and resolutions and a complete and accurate record of all meetings and actions of directors and shareholders of the Company since the incorporation of the Company, and reflect all transactions referred to in such minutes accurately up until the Closing Date.  The share certificate books, register of shareholders, register of transfers and register of directors of the Company are complete and accurate;

(k)

the financial statements of TTTC for the period ended December 31, 2001 (the “Financial Statements”) have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods indicated and from period to period, except that the Financial Statements may not contain all footnotes required by generally accepted accounting principles.  The Financial Statements fairly present the financial condition and operating results of the Company as of the dates and for the periods indicated therein, subject in the case of the unaudited Financial Statements to normal year end audit adjustments.  The provision for taxes of the Company as shown in the Financial Statements is adequate for taxes due or accrued as of the date thereof.  A true and complete copy of the Financial Statements has been delivered to the Purchaser;

(l)

except as set forth in the Financial Statements, TTTC does not have any liabilities, obligations or commitments (including, without limitation, indebtedness, tax liabilities, guarantees, indemnifications, surety or similar obligations), whether accrued, absolute contingent or otherwise;

(m)

there are no actions, suits or proceedings (whether or not purportedly on behalf of the Company) pending or, to the best of the knowledge of such Vendor threatened against or adversely affecting the Company, or any of its assets at law or in equity or before any court or governmental agency, domestic or foreign;

(n)

no authorization, consent or approval of, or filing with or notice to, any governmental agency, regulatory body, court or other Person is required to be obtained by such Vendor or by the Company in connection with the execution, delivery or performance of this Agreement or the sale of the Purchased Shares; and 

(o)

the representations, warrants and statements of fact contained herein or otherwise furnished by or on behalf of such Vendor to CEN and CVI in connection with the transactions contemplated by this Agreement so not omit to state any material fact necessary to make any representation, warranty or statement not misleading to a prospective purchaser of equity shares seeking full information as to the Company and its business or proposed business, which, if known by CEN and CVI, might reasonably be expected to deter CEN from completing the transactions contemplated hereunder.

2.2

CEN warrants and represents to each of the Vendors as follows and acknowledges that each of the Vendors is relying on such representations and warranties in connection with the transaction contemplated herein:

(a)

CEN is a company duly incorporated and validly existing under the laws of China and has all necessary power, authority and right to enter into and perform its obligations under this Agreement including, without limitation, to purchase the Purchased Shares from each of the Vendors; and

(b)

this Agreement has been duly and validly authorized, executed and delivered by CEN and constitutes a legal, valid and binding obligation of the Purchaser, enforceable against it in accordance with its terms.

2.3

The representations and warranties contained in this Agreement shall survive the Closing (as defined below), the issuance of the CVI Shares.

2.4

Each of the Vendors will, upon demand, indemnify, defend and hold harmless CEN and CVI from and against any and all demands, claims, actions, proceedings, losses, damages, liabilities, costs, and expenses suffered or incurred by CEN and CVI, directly or indirectly by reason of a breach of or any inaccuracy in any of the representations or warranties of that Vendor contained in Section 2.1 hereof or a breach of any of the covenants of that Vendor contained in Section 3.1 hereof.

2.5

CEN will, upon demand, defend and hold harmless each of the Vendors from and against any and all demands, claims, actions, proceeding, losses, damages, liabilities, costs, and expenses suffered or incurred by such Vendor, directly or indirectly, by reason of a breach of or any inaccuracy in any of the representations or warranties contained in Section 2.2 hereof or a breach of any of the covenants contained in Section 3.2 hereof.

3.0

COVENANTS

3.1

Each of the Vendors covenants and agrees to and with the Purchaser that:

(a)

such Vendor will, on or before the Closing Date, at its expense, execute and/or deliver each of the documents referred to Section 5.1 hereof, and do any and all further acts and things and execute and deliver any and all further documents and instruments as are necessary or desirable to carry out the intent of this Agreement; and

(b)

such Vendor will not enter into any agreement, commitment, or arrangement, or undertake or omit to take any other action, which would preclude the Vendor from completing the transactions contemplated hereby on the terms set out in this Agreement.

3.2

CEN covenants to and with each of the Vendors that it will, on or before the Closing Date, execute and deliver each of the documents referred to in Section 5.2 hereof.

4.0

CONDITIONS PRECEDENT

4.1

Notwithstanding anything herein contained, the obligation of CEN to carry out the terms of this Agreement and to complete the purchase and sale of the Purchased Shares is subject to the fulfillment, on or before the Closing Date, of each of the following conditions:

(a)

each of the warranties and representation of each of the Vendors made herein shall be true and correct as of the date hereof and as of the Closing Date;

(b)

each of the Vendors shall have complied with all of the covenants and agreement required to be performed or complied with by him hereunder;

(c)

CEN shall be fully satisfied in its sole discretion with the results of its due diligence inquiries regarding TTTC and the Purchased Shares; and 

(d)

CVI shall have obtained all regulatory approvals required to enable CVI to complete the transactions contemplated hereby and to enable CVI to issue the CVI Shares hereunder.

4.2

The conditions set forth in Section 4.1 are for the exclusive benefit of the Purchaser and may be waived by the Purchaser in whole or in part on or before the Closing Date.

4.3

Notwithstanding anything else herein contained, the obligation of the Vendors to carry out the term of this Agreement and to complete the purchase and sale of the Purchased Shares is subject to the fulfillment, on or before the Closing Date, of each of the following conditions:

(a)

each of the warranties and representations of CEN shall be true and correct as of the date hereof and as of the Closing Date; and

(b)

CEN shall have complied with all of the covenants and agreements required to be performed or complied with by it hereunder.

5.0

CLOSING DELIVERIES

5.1

At the Closing, the Vendors shall deliver or cause to be delivered to the Purchaser:

(a)

the resignation in writing of the director and officer of TTTC;

(b)

share certificates representing the Purchased Shares, registered in the name of the Vendors and duly endorsed for transfer to CEN;

(c)

a certificate, executed by such Vendor and dated the Closing Date, to the effect that the representations and warranties of such Vendor contained in this Agreement are true and correct as of the Closing Date;

(d)

the re-registered TTTC business license, certificate of the ownership approvals and all related documents for the CEN’s 70% ownership of TTTC;

(e)

the amended Articles and the name list of the Board of Directors of TTTC.

5.2

At the Closing, CEN shall deliver or cause to be delivered to the Vendors share certificates representing the CVI Shares registered in the names of the Vendors, in the amounts set forth opposite each such Vendors’ name in Schedule A.

6.0

CLOSING

6.1

The completion of the purchase and sale of the Purchased Shares as contemplated by this Agreement (the “Closing”) shall take place at the date as the Parties may agree upon in writing (the “Closing Date”), at the offices of counsel for CVI or other place which determinate by the parties.

6.2

All documents to be delivered at the Closing will be delivered to counsel for CVI, in escrow, on or before the Closing Date.  All matters of payment, execution and delivery of documents required to be paid and/or delivered at Closing will be deemed to be concurrent requirements, and the Closing shall not occur until all such payment and documents have been paid, executed and/or delivered, as the case may be.

7.0

GENERAL

7.1

Time shall be the essence of this Agreement.

7.2

This Agreement and each of the documents delivered pursuant hereto shall be governed by and construed in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable therein.

7.3

The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision hereof and any such invalid or unenforceable provision shall be deemed to be severable.

7.4

The terms “affiliate” and “associate”, wherever used in this Agreement, shall have the respective meaning ascribed to them in the Company Act (British Columbia).

7.5

This Agreement, together with the other documents provided for herein, contains the whole agreement between the Vendor and Purchaser in respect to the purchase and sale of the Purchased Shares and supersedes all prior agreements, undertakings, and commitments whether oral or written, between the Parties with respect to the subject matter hereof.  There are no warranties, representations, terms, conditions or collateral agreements, express or implied between the Parties with respect to the subject matter of this Agreement, except as set out in this Agreement or in the documents provided for herein.

7.6

No amendment, waiver or termination of this Agreement shall be binding unless executed in writing by the Party to be bound thereby.  No waiver of any provision nor shall any such waiver constitute a continuing waiver, unless otherwise expressly provided.

7.7

This Agreement shall be binding upon and ensure to the benefit of the Parties and their respective successors and assigns, provided that neither this Agreement nor any of the documents to be delivered hereunder may be assigned, by either Party without the prior written consent of the other Party.

7.8

This Agreement may be executed in one or more counterparts and together such counterparts shall be deemed to constitute one and the same agreement.

IN WITNESS WHEREOF the Parties have executed this Agreement as of the 9th day of June, 2002.

BEIJING CHENGBO SCIENCE & TRADE LTD.

Per:____________________________

Authorized Signatory

BEIJING SKY-LAND CULTURE LTD.

Per:____________________________

Authorized Signatory

CEN SMART NETWORKS LTD.

Per:____________________________

Authorized Signatory

CHINA VENTURES INC.

Per:____________________________

Authorized Signatory

SCHEDULE A

PURCHASED SHARES

	 	Number of Common Shares of Company Owned

	Number of Purchased Shares

	Number of CVI Shares to be Issued

	 	 	 	 
	Chengbo

	58%

	46.67%

	5,266,700*

	Sky-Land

	29%

	23.33%

	2,633,300*

	 	 	 	 
	Total

	87%

	70.00%

	7,900,000*

Note *: The final number should be adjusted by the final valuation of TTTC.

SCHEDULE B

SHARE EXCHANGE AGREEMENT

THIS AGREEMENT is made as of the 9th day of June, 2002 between BEIJING CHENGBO SCIENCE & TRADE LTD., a corporation duly incorporated under the laws of China, BEIJING SKY-LAND CULTURE LTD., a corporation duly incorporated under the laws of China, (collectively, the “Vendors”), CEN SMART NETWORKS LTD., a company duly incorporated under the laws of China, (the “CEN”) and CHINA CENTURES INC., a company duly incorporated under the laws of the Province of British Columbia (“CVI”).

WHEREAS

A.

Pursuant to a share purchase agreement (the “Share Purchase Agreement”) dated as of June 9, 2002 among CVI and the Vendors, the Purchaser has agreed to purchase and the Vendors have agreed to sell an aggregate of 70% of Today’s Teachers Technology & Culture Ltd. (“TTTC”) in exchange for the issuance of common shares of CVI; and

B.

CVI has agreed to issue the Common Shares of CVI (“CVI Shares”) immediately in exchange for the acquisition of 70% ownership of TTTC through CEN in accordance with the terms hereof;

NOW THEREFORE in consideration of the respective covenants and agreements provided in this Agreement and for other goods and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties hereto hereby covenant and agree as follows:

1.0

CURRENT MARKET PRICE

1.1

The term “Current Market Price”, as used herein, means, in respect of a CVI Share on any date, the average of the closing prices of CVI Shares during a period of 20 consecutive trading days ending not more than three trading days before such date on the Canadian Venture Exchange, provided however, that if in the opinion of the board of directors of CVI the public distribution or trading activity of CVI Shares during such period does not create a market which reflects the fair market value of a CVI Share, then the Current Market Price of a CVI Share shall be determined by the board of directors of CVI based upon the advice of such qualified independent financial advisors and the regulation of the Stock Exchange as the board of directors of CVI may deem to be appropriate, and provided further than any such selection, opinion or determination by the board of directors of CVI shall be conclusive and binding.

2.0

SHARE EXCHANGE

2.1

CVI hereby agrees to purchase from each of the Vendors and each of the Vendors agrees to sell to CVI, immediately upon the issuance thereof all, and not less than all of the 70% ownership of TTTC to CEN, the joint venture company of CVI in China in accordance with the provisions of this Agreement.

2.2

CVI shall deliver certificates representing the CVI Shares transferred to each of the Vendors (or to such other persons, if any, properly designated by such Vendor) on the Exchange Date.  Pursuant to this Agreement, immediately upon the issuance of the CVI Shares on the Exchange Date, the closing of the transaction of purchase and sale contemplated hereby shall be deemed to have occurred.

3.0

VENDOR REPRESENTATION AND WARRANTIES

3.1

Each of the Vendors acknowledges that any CVI Shares issued to it hereunder will be subject to certain resale restrictions under applicable securities law and the policies of the Canadian Venture Exchange.  Each such Vendor also acknowledges that it has been advised to consult its own legal advisors with respect to applicable resale restrictions and that it is solely responsible for complying with such restrictions (and CVI is not in any manner responsible for ensuring compliance by any Vendor with such restrictions).

3.2

Each of the Vendors further acknowledges that a legend will be placed on the certificates representing any CVI Shares issued to it hereunder to the effect that the securities represented by such certificates are subject to a hold period and may not be traded in British Columbia until a date twelve months from the date of issue except as permitted by the Securities Act (British Columbia) and the Securities Rules (British Columbia).

3.3

Each of the Vendors warrants and represents to CVI that it will be acquiring any CVI Shares acquired hereunder as principal for its own account and not for the benefit of any other person, and for investment purposes and not with a view to resale or distribution.

4.0

GENERAL PROVISIONS

4.1

Time shall be the essence of this Agreement.

4.2

The parties shall execute and deliver all such further documents and instruments and do all acts and things as may be reasonably required to carry out the full intent and meaning of this Agreement.

4.3

This Agreement contains the whole agreement between the parties hereto in respect of the transactions contemplated hereby and there are no warranties, representations, term, conditions or collateral agreement, express, implied or statutory, other than expressly set forth in this Agreement.  No alteration or amendment of this Agreement shall take effect unless the same is in writing duly executed by all the parties hereto.

4.4

This Agreement shall ensure to the benefit of and be binding upon the parties hereto, their respective successors and permitted assigns, as the case may be.

4.5

Except as expressly provided herein, this Agreement may not be assigned by any party hereto without the consent of each of the parties hereto.

4.6

This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which taken together shall constitute one and the same instrument.

4.7

This Agreement shall be construed and enforceable in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable therein.

IN WITNESS WHEREOF the parties have duly executed this Agreement as of the 9th day of June, 2002.

BEIJING CHENGBO SCIENCE & TRADE LTD.

Per:____________________________

Authorized Signatory

BEIJING SKY-LAND CULTURE LTD.

Per:____________________________

Authorized Signatory

CEN SMART NETWORKS LTD.

Per:___________________________

Authorized Signatory

CHINA VENTURES INC,

Per:___________________________

Authorized Signatory

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