UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of October 2019
Commission File Number 001-34837
Luokung Technology Corp.
(Translation of registrant's name into English)
B9-8, Block B, SOHO Phase II, No. 9, Guanghua Road, Chaoyang District, Beijing
People’s Republic of China, 100020
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F þ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6'-K in paper as permitted by Regulation S-T Rule 101(b)(1): ___
Note: Regulation S-T Rule 101(6)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule l01(b)(7): ____
Note: Regulation S-T Rule 101(6)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public' under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
Luokung Technology Corp.
Entry into Supplemental Agreement
As reported in a Form 6-K filed on September 13, 2019, on August 28, 2019, Luokung Technology Corp., a corporation organized under the laws of the British Virgin Islands (the “Company”), entered into a Share Purchase Agreement (the “Agreement”) pursuant to which the Company will acquire 100% of the equity interests of eMapgo Technologies (Beijing) Col, Ltd. (“EMG) from EMG’s shareholders for an aggregate purchase price of RMB 836 million (approximately equivalent to $119 million), which includes approximately RMB 709 million in cash and the remaining RMB 127 million will be paid by issuance of the Company’s common stock (the “Shares”) at the conversion rate of $7 per share. The agreement to acquire EMG is conditioned on, among other things, the Company's ability to raise the necessary financing to consummate the acquisition of EMG. The Agreement contains customary representations and warranties, indemnification provisions, and pre- and post-closing conditions and covenants of each party, including that the agreement is conditioned on the Company’s ability to raise the necessary financing to consummate the acquisition of EMG. The description contained herein of the terms of the Agreement does not purport to be complete and is qualified in its entirety by reference to the Agreement, a copy of which was attached hereto as Exhibit 99.1, and incorporated by reference herein, to the Form 6-K filed by the Company on September 13, 2019. The Shares to be issued by the Company pursuant to the Agreement shall be sold and issued pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended.
On October 11, 2019, the Company entered into a Supplemental Agreement (the “Supplemental Agreement”) by and among the Company, Beijing Zhong Chuan Shi Xun Technology Limited, a company incorporated under the laws of the People’s Republic of China (“Beijing Zhong”), Saleya Holdings Limited, a company incorporated under the laws of the British Virgin Islands (“Saleya”), eMapgo Technologies (Beijing) Co., Ltd., a company incorporated under the laws of the PRC (the “eMapgo”); Beijing DMG Infotech Co., Ltd., a company incorporated under the laws of the PRC (“Beijing DMG”); and the parties set forth on Schedule A of the Supplemental Agreement, pursuant to which the parties to the Supplemental Agreement agreed to further clarify and make amendments to the closing schedule and payment schedule as set forth in the Agreement. The parties to the Supplemental Agreement have agreed that the closing contemplated in the Agreement shall occur on or prior to December 31, 2019, unless otherwise further agreed in writing by the Company and all the parties set forth on Part I of Schedule A to the Supplemental Agreement.
Notwithstanding anything to the contrary contained in the Agreement or any documents entered into in connection with the transactions contemplated by the Agreement, including but not limited to Section 2.8 of the Agreement, and subject to the terms and conditions in the Supplemental Agreement, the Company and Beijing Zhong shall, (i) deliver or cause to be delivered common stock with a restricted legend on or prior to October 31, 2019 as set forth in the Agreement; and (ii) deliver or cause to be delivered to the parties set forth on Schedule A of the Supplemental Agreement the remaining amount of the Aggregate Purchase Price in three installments, provided that (a) the first installment (the “First Installment”) shall be delivered on or prior to October 31, 2019 (the “First Payment Date”), (b) the second installment (the “Second Installment”) shall be delivered on or prior to November 30, 2019 (the “Second Payment Date”), (c) the third installment (the “Third Installment”, together with the First Installment and the Second Installment, collectively, the “Installments”, and each a “Installment”) shall be delivered on or prior to December 31, 2019 (the “Third Payment Date”, together with the First Installment Date and the Second Installment Date, collectively, the “Installment Dates”, and each a “Installment Date”), (d) the aggregate amount of the First installment shall be no less than USD10,000,000, and the aggregate amount of the First Installment and the Second installment shall be no less than the amount equal to eighty percent (80%) of RMB709,567,913. The Parties further agree that the liquidated damages set forth in Section 9.4 of the Agreement shall still apply mutatis mutandis to the obligations of the Company and Beijing Zhong to pay the First Installment, the Second Installment and/or the Third Installment provided that the Company or Beijing Zhong fail(s) to pay the relative Installment within 5 Business Days after the relative Installment Date.
The description contained herein of the terms of the Supplemental Agreement does not purport to be complete and is qualified in its entirety by reference to the Supplemental Agreement, a copy of which is attached hereto as Exhibit 99.1 and incorporated by reference herein.
In connection with the Supplemental Agreement, the Company is hereby furnishing under the cover of Form 6-K:
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Luokung Technology Corp. | ||
| Date: October 17, 2019 | By: | /s/ Xuesong Song |
| Name: | Xuesong Song | |
| Title: |
Chief Executive Officer
(Principal Executive Officer) and Duly Authorized Officer |
|
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Exhibit Index
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Exhibit 99.1
SUPPLEMENTAL AGREEMENT
THIS SUPPLEMENTAL AGREEMENT (this “Agreement”) is entered into on [*], 2019 by and among:
| 1. | Luokung Technology Corp., a company incorporated under the laws of the British Virgin Islands (the “Purchaser”); |
| 2. | Beijing Zhong Chuan Shi Xun Technology Limited (北京中传视讯科技有限公司), a company incorporated under the laws of the People’s Republic of China (the “PRC”) (the “Domestic Purchaser”); |
| 3. | Saleya Holdings Limited, a company incorporated under the laws of the British Virgin Islands (the “Company”); |
| 4. | eMapgo Technologies (Beijing) Co., Ltd. (易图通科技（北京）有限公司), a company incorporated under the laws of the PRC (the “Onshore Opco”); |
| 5. | Beijing DMG Infotech Co., Ltd. (北京龙图通信息技术有限公司), a company incorporated under the laws of the PRC (the “WFOE”); |
| 6. | the Persons set forth in Part I of the Schedule A (collectively, the “Offshore Selling Shareholders” and each an “Offshore Selling Shareholder”); and |
| 7. | the Persons set forth in Part II of the Schedule A (collectively, the “Onshore Selling Shareholders” and each an “Onshore Selling Shareholder”, together with Offshore Selling Shareholders, the “Selling Shareholders” and each a “Selling Shareholder”, for the avoidance of doubt, to the person that is set forth as both Onshore Selling Shareholder and Offshore Selling Shareholder simultaneously, such person shall undertake the obligations and have the right of the Onshore Selling Shareholder or Offshore Selling Shareholder wherever applicable). |
The Purchaser, the Domestic Purchaser, the Company, the Onshore Opco, the WFOE and the Selling Shareholders may hereinafter be collectively referred to as the “Parties” and each a “Party”.
Unless otherwise defined or specified herein, capitalized terms used herein shall have the same meanings given in the Share Purchase Agreement entered into by and among the Parties and certain other parties named therein on August 27, 2019 (the “Purchase Agreement”).
RECITALS
| A. | The Parties have entered into the Purchase Agreement, pursuant to which (i) the Purchaser has agreed to purchase, and each of the Offshore Selling Shareholders of the Company has agreed to sell, certain number and type of the Shares in the Company at the Closing, and (ii) the Domestic Purchaser has agreed to purchase, and each of the Onshore Selling Shareholders of the Onshore Opco has agreed to sell, certain equity interest in the Onshore Opco at the Closing, subject to the terms and conditions set forth in the Purchase Agreement. |
| B. | Immediately after the Closing, the Purchaser will hold entire Shares of the Company and the Domestic Purchaser will hold 100% equity interest of the Onshore Opco. |
| C. | To facilitate the transactions contemplated thereby, the Parties agree to further clarify and make amendments to the Closing schedule and payment schedule as set forth in the Purchase Agreement. |
NOW, THEREFORE, considering the mutual promises stipulated in the above recitals and the following sections of this Agreement and the adequate, good and valuable consideration received, which is hereby acknowledged, the Parties agree to the following:
1. Closing Schedule and Payment Schedule
1.1. Notwithstanding anything to the contrary contained in the Transaction Documents, including but not limited to Section 2.5 of the Purchase Agreement, the Parties agree that the Closing shall occur on or prior to December 31, 2019 (in which case the Long-Stop Date shall also be extended to the same), unless otherwise further agreed in writing by all the Offshore Selling Shareholders and the Purchaser.
1.2. Notwithstanding anything to the contrary contained in the Transaction Documents, including but not limited to Section 2.8 of the Purchase Agreement, and subject to the terms and conditions in this Agreement, the Purchaser and the Domestic Purchaser shall, (i) deliver or cause to be delivered to each Founder, a duly issued share certificate in the name of such Founder representing the LKCO Common Shares with the number set forth in the SCHEDULE A of the Purchase Agreement and with a restricted legend pursuant to the Purchase Agreement on or prior to October 31, 2019; and (ii) deliver or cause to be delivered to the Offshore Selling Shareholders and Onshore Selling Shareholders the remaining amount of the Aggregate Purchase Price in three installments, provided that (a) the first installment (the “First Installment”) shall be delivered on or prior to October 31, 2019 (the “First Payment Date”), (b) the second installment (the “Second Installment”) shall be delivered on or prior to November 30, 2019 (the “Second Payment Date”), (c) the third installment (the “Third Installment”, together with the First Installment and the Second Installment, collectively, the “Installments”, and each a “Installment”) shall be delivered on or prior to December 31, 2019 (the “Third Payment Date”, together with the First Installment Date and the Second Installment Date, collectively, the “Installment Dates”, and each a “Installment Date”), (d) the aggregate amount of the First installment shall be no less than USD10,000,000, and the aggregate amount of the First Installment and the Second installment shall be no less than the amount equal to eighty percent (80%) of RMB709,567,913, (e) with respect to any of the foregoing installment, each Selling Shareholder will receive an equal percentage in the Aggregate Purchase Price on parity with each other. The Parties further agree that the liquidated damages set forth in Section 9.4 of the Purchase Agreement shall still apply mutatis mutandis to the obligations of the Purchaser and Domestic Purchaser to pay the First Installment, the Second Installment and/or the Third Installment provided that the Purchaser or the Domestic Purchaser fail(s) to pay the relative Installment within 5 Business Days after the relative Installment Date.
1.3. Notwithstanding anything to the contrary contained in the Transaction Documents, including but not limited to ARTICLE VIII of the Purchase Agreement, in the case that the Parties agree to terminate the Purchase Agreement or the transaction contemplated thereby by written consent of all Offshore Selling Shareholders, the Company and the Purchaser, the liquidated damages shall be waived by the Offshore Selling Shareholders.
1.4. Notwithstanding anything to the contrary contained in the Transaction Documents, including but not limited to Section 2.7 of the Purchase Agreement, a filing acceptance letter (“受理通知书”), issued by competent SAMR in related to (A) the Onshore Equity Transfer; (B) the appointment of the individuals assigned by the Domestic Purchaser as directors, legal representatives, or supervisors to the Onshore Opco and WFOE; (C) adoption of new articles of association of Onshore Opco satisfactory to the Domestic Purchaser, shall be delivered or cause to be delivered to the Domestic Purchaser prior to the Third Installment Date. For the avoidance of doubt, the obligation of the Purchaser and Domestic Purchaser to deliver the Third Installment is subject to the receipt of such filing acceptance letter (“受理通知书”) by the Purchaser and Domestic Purchaser.
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1.5. For the avoidance of doubt, each Party shall be relieved, held harmless from and against all liabilities, damages, actions, suits, proceedings, claims, costs, charges and expenses suffered or incurred by or brought or made against such Party, as a result of or in connection with failure to consummate the Closing by September 30, 2019 or, with respect to Purchaser and the Domestic Purchaser, to make the full payment of the Aggregate Purchase Price to the Selling Shareholders, including but not limited to the liquidated damages set forth in Section 9.4 of the Purchase Agreement.
2. REPRESANTATIONS AND WARRANTIES
2.1. Representations and Warranties of Each Party. Each Party, severally but not jointly, represents and warrants to each other Party, that (i) such Party has all requisite power, authority and capacity to execute and deliver this Agreement, and to perform its obligations hereunder. This Agreement, when executed and delivered by such Party, will constitute legal, valid and binding obligations of such Party and enforceable against it in accordance with terms hereunder; (ii) this Agreement has been reviewed and approved by their board, shareholders and/or other equivalent corporate organs, and in connection with the execution and delivery hereof, the Parties have received all requisite consents, waivers and approvals; and (iii) other than this Agreement, none of the Parties, or any of their respective Affiliates, has entered into any other binding agreement that has the effect of amending, waiving or otherwise modifying, in each case, either conditionally or otherwise, any provisions of the Purchase Agreement or any other Transaction Documents.
2.2. Effectiveness of the Prior Representations and Warranties. For the avoidance of doubt, each of the Company, the Onshore Opco and the WFOE, severally and jointly, represents and warrants that the representations and warranties with respect to the Group Companies as set forth in the Article III of the Purchase Agreement are true, correct and complete as of the date hereof and as of the Closing Date. Each Selling Shareholder, severally and not jointly, represents and warrants that the representations and warranties with respect to the respective Selling Shareholder as set forth in the Article IV of the Purchase Agreement are true, correct and complete as of the date hereof and as of the Closing Date.
3. MISCELLANEOUS
3.1. Amendment to the Purchase Agreement. This Agreement shall be read and construed as an amendment to, and shall form part of, the Purchase Agreement. Except for the terms explicitly amended or terminated hereunder, the remaining of the Purchase Agreement shall be in full force. In the event there is any discrepancy between this Agreement and the Purchase Agreement, the terms and conditions of this Agreement shall prevail.
3.2. Incorporation by Reference. Article X of the Purchaser Agreement shall be incorporated by reference into this Agreement and apply to this Agreement, mutatis mutandis, as if reference to “this Agreement” in such provisions of the Purchase Agreement is a reference to “this Agreement”.
3.3. Further Assurances. Each Party shall from time to time and at all times hereafter make, do, execute, or cause or procure to be made, done and executed such further acts, deeds, conveyances, consents and assurances without further consideration, which may reasonably be required to effect the agreements and transactions contemplated by this Agreement, including without limitation the adoption of any necessary or appropriate amendments to the Transaction Documents.
3.4. Remedies. Without prejudice to any other rights or remedies which a Party may have under this Agreement, the Parties acknowledge and agree that damages may not be an adequate remedy for any breach of this Agreement and the remedies of injunction, specific performance and other non-monetary remedies (in addition to damages) as permitted by applicable laws are appropriate for any threatened or actual breach of any provision of this Agreement and no proof of special damages shall be necessary for a Party to seek enforcement of rights under this Agreement.
3.5. Effectiveness and Validity. This Agreement shall take effect and become legally binding on the Parties immediately upon execution by the Parties on the date hereof.
[Signatures on the Following Pages]
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IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| COMPANY | ||
| Saleya Holdings Limited | ||
| By: | ||
| Name: | ||
| Title: | ||
| ONSHORE OPCO | ||
| eMapgo Technologies (Beijing) Co., Ltd. | ||
| (易图通科技（北京）有限公司) | ||
| By: | ||
| Name: | ||
| Title: | ||
| WFOE | ||
| Beijing DMG Infotech Co., Ltd. | ||
| (北京龙图通信息技术有限公司) | ||
| By: | ||
| Name: | ||
| Title: | ||
EMG - Signature Page to the Supplemental Agreement
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| PURCHASER | ||
| Luokung Technology Corp. | ||
| By: | ||
| Name: | ||
| Title: | ||
| DOMESTIC PURCHASER | ||
| Beijing Zhong Chuan Shi Xun Technology Limited | ||
| (北京中传视讯科技有限公司) | ||
| By: | ||
| Name: | ||
| Title: | ||
EMG - Signature Page to the Supplemental Agreement
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| SELLING SHAREHOLDERS | ||
|
Zhi-Xun Wang
(王志勋) |
||
| By: | ||
|
Hong-Bin Lu
(陆洪彬) |
||
| By: | ||
|
Zhi-Gang Wang
(王志钢) |
||
| By: | ||
|
Guan-Hua Fu
(符冠华) |
||
| By: | ||
|
YEH, MING TUNG
(叶明通) |
||
| By: | ||
|
Rui-Xia Ding
(丁蕊霞) |
||
| By: | ||
EMG - Signature Page to the Supplemental Agreement
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| SELLING SHAREHOLDERS | ||
| Globalearth Holdings Limited | ||
| By: | ||
| Name: | ||
| Title: | ||
EMG - Signature Page to the Supplemental Agreement
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| SELLING SHAREHOLDERS | ||
| Global Earth Venture Limited | ||
| By: | ||
| Name: | ||
| Title: | ||
EMG - Signature Page to the Supplemental Agreement
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| SELLING SHAREHOLDERS | ||
|
Shanghai Zhizhuo Space Property Management Co., Ltd. (上海知卓空间资产管理有限公司) |
||
| By: | ||
| Name: | ||
| Title: | ||
EMG - Signature Page to the Supplemental Agreement
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| SELLING SHAREHOLDERS | ||
| Beijing Shengjia Tongce Technology Center (Limited Partnership) | ||
| (北京盛佳同策科技中心（有限合伙）) | ||
| By: | ||
| Name: | ||
| Title: | ||
| Beijing Yitu Youwei Technology Center (Limited Partnership) | ||
| (北京易图有为科技中心（有限合伙）) | ||
| By: | ||
| Name: | ||
| Title: | ||
| Beijing Yuandong Technology Partnership Enterprise (Limited Partnership) | ||
| (北京源动科技合伙企业（有限合伙）) | ||
| By: | ||
| Name: | ||
| Title: | ||
EMG - Signature Page to the Supplemental Agreement
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| SELLING SHAREHOLDERS | ||
| Beijing Yitu Youdao Technology Center (Limited Partnership) | ||
| (北京易图有道科技中心（有限合伙）) | ||
| By: | ||
| Name: | ||
| Title: | ||
| Beijing Yitu Jingshi Technology Center (Limited Partnership) | ||
| (北京易图精实科技中心（有限合伙） | ||
| By: | ||
| Name: | ||
| Title: | ||
EMG - Signature Page to the Supplemental Agreement
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| SELLING SHAREHOLDERS | ||
|
Beijing Jingyingcai Investment Co., Ltd. (北京经英才投资有限公司) |
||
| By: | ||
| Name: | ||
| Title: | ||
EMG - Signature Page to the Supplemental Agreement
IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first written above.
| SELLING SHAREHOLDERS | ||
|
Zhu-Ping Zhuang
(庄竹萍) |
||
| By: | ||
EMG - Signature Page to the Supplemental Agreement
SCHEDULE A
PART I – OFFSHORE SELLING SHAREHOLDERS
| Offshore Selling Shareholder |
| Zhi-Xun Wang (王志勋) |
| Hong-Bin Lu (陆洪彬) |
| Zhi-Gang Wang (王志钢) |
| Guan-Hua Fu (符冠华) |
| YEH, MING TUNG (叶明通) |
| Rui-Xia Ding (丁蕊霞) |
| Globalearth Holdings Limited |
| Global Earth Venture Limited |
PART II – ONSHORE SELLING SHAREHOLDERS
| Onshore Selling Shareholder |
| 北京盛佳同策科技中心（有限合伙） |
| 北京易图有为科技中心（有限合伙） |
| 北京源动科技合伙企业（有限合伙） |
| 北京易图有道科技中心（有限合伙） |
| 北京易图精实科技中心（有限合伙） |
| 北京经英才投资有限公司 |
| 符冠华 |
| 庄竹萍 |
| 丁蕊霞 |
| 上海知卓空间资产管理有限公司 |
SCHEDULE A